Prioritization and Allocation Authority Exercised by the Secretary of Transportation Under the Defense Production Act, 8675-8699 [2011-3209]

Agencies

• DEPARTMENT OF TRANSPORTATION
• Office of the Secretary

[Federal Register Volume 76, Number 31 (Tuesday, February 15, 2011)]
[Proposed Rules]
[Pages 8675-8699]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2011-3209]


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DEPARTMENT OF TRANSPORTATION

Office of the Secretary

49 CFR Part 33

[Docket No. OST 2010-0298]
RIN 2105-AD83


Prioritization and Allocation Authority Exercised by the 
Secretary of Transportation Under the Defense Production Act

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

ACTION: Notice of proposed rulemaking (NPRM).

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SUMMARY: The Department of Transportation's Office of the Secretary 
(OST) is initiating this proposed rulemaking to clarify the priorities 
and allocation authorities exercised by the Secretary of Transportation 
(Secretary) under title 1 of the Defense Production Act of 1950 
(Defense Production Act), and to set forth the administrative 
procedures by which the Secretary will exercise this authority. This 
proposed rule complies with the requirement in the Defense Production 
Act Reauthorization of 2009 (Pub. L. 111-67) to issue final rules 
establishing standards and procedures by which the priorities and 
allocations authority is used to promote the national defense, under 
both emergency and nonemergency conditions, and is part of a multi-
agency effort that forms the Federal Priorities and Allocations System.

DATES: Comment Closing Date: Comments must be received by March 17, 
2011.

ADDRESSES: You may submit comments (identified by the agency name and 
DOT Docket ID Number OST-2010-0298) by any of the following methods:
     Federal eRulemaking Portal: Go to https://www.regulations.gov and follow the online instructions for submitting 
comments.
     Mail: Docket Management Facility: U.S. Department of 
Transportation, 1200 New Jersey Avenue, SE., West Building Ground 
Floor, Room W12-140, Washington, DC 20590-0001.
     Hand Delivery or Courier: West Building Ground Floor, Room 
W12-140, 1200 New Jersey Avenue, SE., between 9 a.m. and 5 p.m. ET, 
Monday through Friday, except Federal holidays.
     Fax: 202-493-2251.
    Instructions: You must include the agency name (Office of the 
Secretary, DOT) and Docket number (OST-2010-0298) for this notice at 
the beginning of your comments. You should submit two copies of your 
comments if you submit them by mail or courier. Note that all comments 
received will be posted without change to https://www.regulations.gov 
including any personal information provided and will be available to 
internet users. You may review DOT's complete Privacy Act Statement in 
the Federal Register published on April 11, 2000 (65 FR 19477) or you 
may visit https://DocketsInfo.dot.gov.
    Docket: For Internet access to the docket to read background 
documents and comments received, go to https://www.regulations.gov. 
Background documents and comments received may also be viewed at the 
U.S. Department of Transportation, 1200 New Jersey Ave., SE., Docket 
Operations, M-30, West Building Ground Floor, Room W12-140, Washington, 
DC 20590, between 9 a.m. and 5 p.m., Monday through Friday, except 
Federal holidays.

FOR FURTHER INFORMATION CONTACT: Donna L. O'Berry, Office of the 
General Counsel, Department of Transportation, 1200 New Jersey Avenue, 
SE., Room W96-317, Washington, DC 20590; telephone: (202) 366-6136; e-
mail: donna.o'berry@dot.gov; or Lloyd E. Milburn, Office of 
Intelligence, Security and Emergency Response, Department of 
Transportation, 1200 New Jersey Avenue, SE., Washington, DC 20590; 
telephone: (202) 366-4397; e-mail: lloyd.milburn@dot.gov.

SUPPLEMENTARY INFORMATION:

I. Background

    The Defense Production Act of 1950 (Defense Production Act) (50 
U.S.C. App. 2061 et seq.) was enacted during the Korean War to ensure 
the availability of resources to meet national security needs. The 
Defense Production Act provides a number of important authorities to 
expedite and expand the supply of critical resources from the U.S. 
industrial base to support the national defense. While Defense 
Production Act provisions initially focused on Department of Defense 
(DoD) acquisition needs, several significant changes to the Defense 
Production Act definition of national defense have been added over time 
to expand the definition from military, energy, and space activities, 
to include emergency preparedness activities conducted pursuant to 
title VI of the Robert T. Stafford Disaster Relief and Emergency 
Assistance Act (Stafford Act) (42 U.S.C. 5121 et seq.) and the 
protection and restoration of critical infrastructure.
    Section 101(a) of title I of the Defense Production Act (50 U.S.C. 
App. 2071) authorizes the President:

[[Page 8676]]

    (1) To require that performance under contracts or orders (other 
than contracts of employment) which he deems necessary or appropriate 
to promote the national defense shall take priority over performance 
under any other contract or order, and, for the purpose of assuring 
such priority, to require acceptance and performance of such contracts 
or orders in preference to other contracts or orders by any person he 
finds to be capable of their performance, and (2) to allocate 
materials, services, and facilities in such manner, upon such 
conditions, and to such extent as he shall deem necessary or 
appropriate to promote the national defense.
    Executive Order 12919, National Defense Industrial Resources 
Preparedness (June 3, 1994), as amended, delegates the President's 
authority under section 101 of the Defense Production Act to the heads 
of several departments and agencies. The President has delegated this 
authority to the Secretary of Transportation with respect to all forms 
of civil transportation.\1\ While the Department of Transportation 
(DOT) is seeking comments on all aspects of the rulemaking, we are 
particularly interested in comments on the scope and applicability of 
the definition of civil transportation.
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    \1\ Section 201 of Executive Order 12919 also delegates Defense 
Production Act section 101 authority to:
    (1) The Secretary of Agriculture with respect to food resources, 
food resource facilities, and the domestic distribution of farm 
equipment and commercial fertilizer;
    (2) The Secretary of Energy with respect to all forms of energy;
    (3) The Secretary of Health and Human Services with respect to 
health resources;
    (4) The Secretary of Defense with respect to water resources; 
and
    (5) The Secretary of Commerce for all other materials, services, 
and facilities, including construction materials.
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    Section 202 of Executive Order 12919 provides that this delegated 
authority may only be used to support programs that have been 
determined in writing as necessary or appropriate to promote the 
national defense by the Secretary of Defense with respect to military 
production and construction, military assistance to foreign nations, 
stockpiling, outer space and directly related activities; the Secretary 
of Energy with respect to energy production and construction, 
distribution and use, and directly related activities; or the Secretary 
of Homeland Security with respect to essential civilian needs 
supporting national defense, including civil defense and continuity of 
government and directly related activities.
    Executive Order 12656, Assignment of Emergency Preparedness 
Responsibilities, as amended, assigns Federal departments and agencies 
responsibilities for national security emergency preparedness. The 
Secretary of Transportation is assigned lead responsibility for, among 
other things,
    (1) Developing plans to promulgate and manage overall national 
policies, programs, procedures, and systems to meet essential civil and 
military transportation needs in national security emergencies; (2) 
preparing to provide direction to all modes of civil transportation in 
national security emergencies, including air, surface, water, 
pipelines, and public storage and warehousing, to the extent such 
responsibility is vested in the Secretary for: (a) Implementation of 
priorities for all transportation resource requirements for service, 
equipment, facilities, and systems; and (b) allocation of 
transportation resource capacity; and (3) emergency management and 
control of civil transportation resources and systems, including 
privately owned automobiles, urban mass transit, intermodal 
transportation systems, the National Railroad Passenger Corporation and 
the St. Lawrence Seaway Development Corporation.

This proposed rule would set forth the policies and procedures by which 
the Secretary would carry out certain authorities and responsibilities 
assigned under Executive Order 12656.
    The Defense Production Act Reauthorization of 2009 (Pub. L. 111-67, 
September 30, 2009) requires each Federal agency with delegated 
authority under section 101 of the Defense Production Act to issue 
final rules establishing standards and procedures by which the 
priorities and allocations authority is used to promote the national 
defense, under both emergency and non-emergency conditions. Congress 
further directed that, to the extent practicable, the Federal agencies 
should work together to develop a consistent and unified Federal 
priorities and allocations system.
    In order to meet this mandate, DOT has worked in conjunction with 
the Departments of Agriculture, Commerce, Defense, Energy, Health and 
Human Services, and Homeland Security to develop common provisions that 
can be used by each Department in its own regulation. Common provisions 
among the Departments would provide consistency and uniformity for how 
the Federal priorities and allocations are applied. However, each 
Department would supplement in its own regulation, as necessary, the 
common provisions in order to provide additional standards and 
procedures unique to its resource area. The six regulations to be 
promulgated by each Department with delegated Defense Production Act 
title I authority would be commonly referred to as the Federal 
Priorities and Allocations System (FPAS) of rules.
    DOT's proposed regulation to form part of the FPAS would be known 
as the Transportation Priorities and Allocations System (TPAS).\2\ 
Although DOT has developed procedures for implementing this authority 
through Departmental orders and other internal documents and protocols, 
DOT now proposes to establish a regulatory framework through TPAS to 
implement these authorities through this rulemaking. While TPAS adopts 
the common standards established under the FPAS, it would also include 
requirements that are specific to civil transportation. Transportation 
services covered under TPAS would include the movement of persons and 
property by all modes of civil transportation in commerce and related 
public storage and warehousing, ports, services, equipment and 
facilities.
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    \2\ The other parts that make up FPAS are:
    (1) Agricultural Priorities and Allocations System promulgated 
by the Department of Agriculture;
    (2) Defense Priorities and Allocations System promulgated by the 
Department of Commerce;
    (3) Energy Priorities and Allocations System promulgated by the 
Department of Energy;
    (4) Health Resources Priorities and Allocations System 
promulgated by the Department of Health and Human Service; and
    (5) Water Resources Priorities and Allocations System 
promulgated by the Department of Defense.
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    DOT's Maritime Administration (MARAD) currently has regulations in 
46 CFR that are based on Defense Production Act section 101 authority 
and is currently reviewing these regulations to determine if any 
modifications are necessary to bring them into conformance with TPAS.
    Generally speaking, the transportation sector is very robust and 
even in emergencies DOT expects that the normal interactions between 
civilian transportation providers and those using their services will 
be maintained or that it will be possible to address any disruptions 
that may occur without the need for DOT to employ its priorities and 
allocations authority. Although DOT is developing a system to be used 
in emergency and non-emergency situations, DOT anticipates that only an 
extreme crisis would trigger the need to use DOT's authorities under 
this proposed rule. DOT has conducted response activities to multiple 
crises over the last decade and at no time

[[Page 8677]]

during the most severe situation was DOT required to use its delegated 
Defense Production Act priority or allocation authority to marshal 
adequate transportation resources to complete its mission. Instead, 
there was sufficient transportation capacity available through normal 
interactions or alternative arrangements between transportation service 
providers and end users to meet the demand or the disruption was 
addressed through other means.

II. Section-by-Section Analysis

Subpart A--General

    Section 33.1 Purpose of this part. This section explains that the 
purpose of this rule would be to provide guidance and procedures for 
use of the Defense Production Act priorities and allocations authority 
with respect to civil transportation, in accordance with the delegation 
of authority provided in section 201 of Executive Order 12919. This 
section also lists other agency regulations that, along with this 
regulation, would form the Federal Priorities and Allocations System.
    Section 33.2 Priorities and allocations authority. This section 
would summarize the delegations of priorities and allocations authority 
in section 201 of Executive Order 12919. This section would also 
explain that these delegated authorities may only be used to support 
programs that have been determined in writing as necessary or 
appropriate to promote the national defense by the Secretaries of 
Defense, Energy, or Homeland Security in their respective areas of 
jurisdiction, as specified in section 202 of Executive Order 12919.
    Section 33.3 Program eligibility. This proposed section lists the 
categories of programs eligible for priorities and allocations support, 
in accordance with the definition of ``national defense'' in section 
702 of the Defense Production Act (50 U.S.C. App. Sec.  2152).

Subpart B--Definitions

    Section 33.20 Definitions. This section would contain definitions 
used in this part. Some definitions are drawn from other sources, as 
follows:
     Section 702 of the Defense Production Act (50 U.S.C. App. 
Sec.  2152)--``critical infrastructure,'' ``facilities,'' ``homeland 
security,'' ``materials,'' ``national defense,'' ``person,'' and 
``services.''
     Section 901 of Executive Order 12919--``civil 
transportation,'' ``energy,'' ``farm equipment,'' ``fertilizer,'' 
``food resources,'' ``food resource facilities,'' ``health resources,'' 
and ``water resources.''
     The current Defense Priorities and Allocations System 
(DPAS) regulation--``allotment'' (with technical modifications), 
``approved program'' (with technical modifications), ``construction,'' 
``delegate agency,'' ``directive,'' ``item,'' ``maintenance and repair 
and operating supplies'' or ``MRO,'' ``official action'' (with 
technical modifications), ``rated order,'' and ``set-aside'' (with 
technical modifications).
     Section 602 of the Stafford Act (42 U.S.C. 5195a)--
``emergency preparedness'' and ``hazard.''
     Section 18.3 of 49 Code of Federal Regulations--``local 
government'' and ``state.''
    The definitions of ``allocation,'' ``allocation authority,'' and 
``allocation order'' are based on language in section 101 of the 
Defense Production Act that describes the allocation authority of the 
President.
    ``Defense Production Act'' means the Defense Production Act of 
1950, as amended (50 U.S.C. App. 2061 et seq.).
    ``Planning order'' defines an administrative tool used by DOT's 
Maritime Administration.
    ``Resource agency'' refers to one of the six Federal departments 
that has been delegated Defense Production Act priorities and 
allocations authority under section 201 of Executive Order 12919.
    ``Secretary'' refers to the Secretary of Transportation.
    ``Stafford Act'' refers to title VI (Emergency Preparedness) of the 
Robert T. Stafford Disaster Relief and Emergency Assistance Act (42 
U.S.C. 5195-5197g).

Subpart C--Placement of Rated Orders

    Section 33.30 Delegation of authority. This section proposes to 
describe the delegation of priorities and allocations authority from 
the President to the Secretary of Transportation for all forms of civil 
transportation.
    DOT anticipates receiving a delegation of authority from the 
Department of Commerce to enable DOT to place priority ratings for 
items and materials necessary for civil transportation resources that 
fall under the Department of Commerce's jurisdiction. For example, such 
``flow down'' items might include brakes, tires, and engine parts 
necessary for motor coaches to operate under a priority order for the 
provision of civil transportation. In instances where DOT is placing 
such a ``flow down'' priority rating under authority delegated from the 
Department of Commerce, the time period for acceptance and rejection of 
the rated order set forth in TPAS applies, consistent with relevant 
sections of the Department of Commerce's regulations. Transportation 
service providers should work with their parts and component providers 
to ensure they are aware that they may be asked to provide necessary 
parts or components on an expedited basis.
    Section 33.31 Priority ratings. This section would explain the 
following: ``DO'' and ``DX'' rating symbols; program identification 
symbols; order of precedence for directives and ratings; and priority 
ratings that consist of a rating symbol and a program identification 
symbol.
    Generally speaking, most contracts or orders for transportation 
services would be unrated. However, DOT may authorize priority rating 
authority if necessary to support a program that has been determined as 
necessary or appropriate to promote the national defense. A ``DO'' 
rating authorization may be authorized if the service or item is in 
critical or urgent need. For example, in 1990, DOT's Federal Aviation 
Administration was granted ``DO'' rating authority by DoD for specified 
procurements to support Civil Reserve Air Fleet use in Operation Desert 
Shield. In 2002, the Transportation Security Administration, which was 
then part of DOT, was granted ``DO'' rating authorization for contracts 
to support the acquisition of Explosive Detection Systems machines. 
Finally, in 2005, DOT sponsored a priority rating request by a railroad 
operator to support the emergency delivery of generators and transfer 
switches to replace those destroyed by Hurricane Katrina. The 
Department of Commerce granted the company ``DO'' rating authority. A 
``DO'' rated contract or order takes precedence over unrated contracts 
or orders.
    A ``DX'' rating would be reserved for those services or items that 
are determined to support programs that are of the highest national 
defense urgency based on the requesting entity's mission objectives. A 
``DX'' rating would take precedence over a ``DO'' rating. The Secretary 
of Transportation must approve all requests for a ``DX'' rating 
pertaining to civil transportation resources.
    Program Identification Symbols (PIS) would be used to identify 
approved programs, meaning a program that has been determined by the 
Secretaries of DoD, DHS, or DOE, as appropriate, as necessary to 
promote the national defense. DOT currently has no approved programs, 
but anticipates working with Commerce, DHS, DoD or DOE, as appropriate, 
in the near future to

[[Page 8678]]

develop approved programs. The proposed PIS for DOT-approved programs 
would contain the letter ``T'' followed by a letter and a number; for 
example, T-L1. All approved programs would have equal status. The PIS 
would be combined with the appropriate priority rating authority, 
either DX or DO, to form the priority rating, for example DO-T-L1 or 
DX-T-L1. DOT is particularly interested in comments on its proposed PIS 
letter and number combination.
    Section 33.32 Elements of a rated order. This section proposes to 
describe the four elements that must be included in a contract or order 
to make it a ``rated order,'' in accordance with the standards and 
procedures provided in this part. The four elements are: (1) A priority 
rating; (2) specific delivery date(s) for materials or services covered 
in the rated order; (3) the signature of an individual authorized to 
place the rated order; and (4) a statement describing what is required 
of the rated order recipient, in accordance with procedures provided in 
this part.
    This section also would include a provision for an additional 
statement to be included in a rated order involving emergency 
preparedness, which would require quicker action by the recipient to 
accept or reject the order. The justification for the expedited 
timeframes is explained below in the Sec.  33.33 discussion.
    Section 33.33 Acceptance and rejection of rated orders. This 
section would describe mandatory and optional conditions for acceptance 
or rejection of rated orders, as well as customer notification 
timeframes pertaining to acceptance or rejection. In general, a person 
would be required to accept a rated order if the person normally 
supplies the materials or services covered by the rated order and must 
do so regardless of any other orders on hand. Persons would be 
prohibited from charging higher prices, imposing different terms, or 
any other discriminatory practices for the rated order that are 
different from a comparable unrated order.
    A person would be required to reject a rated order if unable to 
fill the order by the specified delivery date(s) or if the order would 
interfere with delivery under another rated order with a comparable or 
higher priority rating. In addition, a person would be required to 
reject a rated order if the person is prohibited by law from meeting 
the terms of the order; for example, the provider of the services 
contemplated in the order does not have current operating authority to 
perform the service. A person would have the option of rejecting a 
rated order if any one of a number of other conditions set forth in the 
regulation exists.
    Under non-emergency conditions, the recipient of a rated order 
would be required to accept or reject the rated order within fifteen 
calendar days for a ``DO''-rated order or ten working days for a 
``DX''-rated order. (See Sec.  33.33(d)) DOT is proposing calendar days 
instead of working days in order to provide greater specificity for 
deadlines. However, DOT is interested in comments on whether the use of 
calendar days could lead to any unintended consequences for recipients 
of a rated order.
    While the deadlines discussed above would be appropriate for non-
emergency circumstances, they are too long for emergency conditions 
when quick procurement actions may be needed to help save lives, 
protect property, or restore services. Transportation services are 
unique in that they are often the first services needed to move people 
out of harm's way and to move rescue and response personnel and 
supplies into a disaster area; thus, transportation services often must 
be marshaled on very short notice. DOT proposes in this rule that 
orders placed for the purpose of emergency preparedness must be 
accepted or rejected within 6 hours from receipt of the order if the 
order is issued in response to a hazard that has occurred and within 12 
hours from receipt of the order if the order is issued to prepare for 
an imminent hazard.
    Prior to 2008, DOT was the lead Federal agency responsible for 
providing and managing emergency transportation services, including 
those necessary for mass evacuations.\3\ Our experiences while carrying 
out this mission, which included managing the massive transportation 
needs for the evacuation of persons and the movement of supplies, 
equipment and teams in response to Hurricanes Katrina and Rita, confirm 
that transportation providers can respond within these expedited 
timeframes. Specifically, the contract that DOT had in place for 
transportation services required the contractor to acknowledge an order 
for service within one hour of receiving the order and to make 
transportation equipment available at the shipment place of origin to 
begin moving cargo and passengers within four hours from receipt of the 
order for service.\4\
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    \3\ In 2007 DOT and DHS entered into a Memorandum of 
Understanding transferring the responsibility for evacuations and 
commodity and equipment movements to the Federal Emergency 
Management Agency (FEMA). New authority given to FEMA in the Post-
Katrina Emergency Management Reform Act of 2006 necessitated 
redefining DOT's role for providing emergency transportation 
services and for designating the Federal lead for planning, 
coordinating and conducting evacuations of the general population.
    \4\ DOT's contract with Landstar Express America, Inc. contained 
the following requirements for Rapid Response Capability:
    Within one (1) hour of receiving the initial Order for Service 
(OFS) from the Contracting Officer, the Contractor (Landstar) shall 
acknowledge receipt of the OFS by electronic commerce or fax.
    Within four (4) hours of receipt of an OFS, the Contractor shall 
make transportation equipment available at the shipment place of 
origin to commence movement of cargo and passengers, using air and 
surface modes of transportation. The Contractor shall meet all 
pickup and transit deadlines.
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    In this proposed provision, DOT would only require acceptance or 
rejection of a rated order within an expedited timeframe and not actual 
fulfillment of the order within that timeframe. The expedited response 
periods proposed in this regulation are necessary in order for DOT to 
rapidly identify and obtain sufficient transportation resources to meet 
emergency response needs.
    DOT is mindful, however, that some circumstances may necessitate 
closer coordination between DOT and the potential recipient of a rated 
order. For example, if a rated order is placed in preparation for an 
imminent hazard, such as a hurricane that is projected to make landfall 
in 13 hours, DOT obviously would not wish to learn at the end of the 
12-hour window that the proposed supplier is unable to accept the rated 
order. In these situations, DOT would work closely with industry to 
identify and resolve any potential issues in order to meet the 
transportation requirements.
    Not all regulations promulgated under FPAS contain such expedited 
notification requirements because those resources normally are not 
required immediately for emergency response as are transportation 
resources. However, for any orders issued under TPAS that ``flow down'' 
from the prime contractor to a subcontracted supplier of a necessary 
service, component, or part, the requirements of TPAS would apply to 
all subcontractors in the procurement or distribution chain. Therefore, 
transportation service providers should work with their suppliers to 
ensure they are aware that they may be asked to provide necessary 
services, parts, or components on an expedited basis.
    Section 33.34 Preferential scheduling. This section would describe: 
(1) When a recipient of a rated order must modify production or 
delivery schedules to satisfy the delivery requirements of a rated 
order; (2) the order of precedence for rated, unrated, and conflicting 
orders; and (3)

[[Page 8679]]

the use of inventoried production items when needed to fill a rated 
order.
    Section 33.35 Extension of priority ratings. This section would 
require that the recipient of a rated order must, in turn, use rated 
orders with suppliers to obtain items or services needed to fill a 
rated order. The requirement would apply to all contractors and 
subcontractors throughout the procurement chain necessary to fill the 
rated order.
    Section 33.36 Changes or cancellations of priority ratings and 
rated orders. This section would describe the procedures for changing 
or cancelling a priority rating or the provisions of a rated order. In 
addition, this section would list types of modifications that do not 
constitute a new rated order.
    Section 33.37 Use of rated orders. This section would describe the 
process and procedures for when the recipient of a rated order: (1) 
Must use rated orders to obtain items and services needed to fulfill 
the rated order; (2) may use a rated order to replace inventoried items 
that were used to fulfill the order; (3) may combine orders with 
different priority ratings or with unrated orders; and (4) may forgo 
use of rated orders for orders below certain thresholds.
    Section 33.38 Limitations on placing rated orders. This section 
would describe specific circumstances when the use of rated orders 
would be prohibited. This section also would prohibit the use of TPAS 
to obtain rated orders for a resource under the resource jurisdiction 
of other agencies with delegated Defense Production Act priorities and 
allocations authority, unless specifically authorized by the resource 
agency.

Subpart D--Special Priorities Assistance

    Section 33.40 General provisions. This section would explain the 
circumstances and procedures under which DOT would provide assistance 
in resolving problems related to priority rated contracts and orders. 
This section also would list the DOT points of contact and the form to 
be used to request assistance.
    Section 33.41 Requests for priority rating authority. This section 
would establish the procedures to request rating authority under 
special circumstances. DOT may grant priority ratings for items and 
services not normally rated under the regulation in order to prevent a 
delay of a rated order. This section also would specify that rating 
authority for production or construction equipment must come from the 
Department of Commerce. Finally, this section would explain when DOT 
may authorize the use of a priority rating on an order to a supplier in 
advance of the issuance of a rated prime contract, and the factors DOT 
would consider in deciding whether to grant such a request.
    Section 33.42 Examples of assistance. This section would list 
examples of when special priority assistance may be provided.
    Section 33.43 Criteria for assistance. This section would require 
that a request for special priorities assistance be timely, that there 
be an urgent procurement need for the item, and that the applicant has 
made a reasonable effort to resolve the problem for which assistance is 
needed.
    Sec.  33.44 Instances where assistance may not be provided. This 
section would list examples of when special priority assistance may not 
be provided.
    Section 33.45 Assistance programs with other nations. Reserved.

Subpart E--Allocation Actions

    Section 33.50 Policy. This section would explain the policy of the 
Federal Government regarding use of the allocations authority, which is 
based on the statutory language in section 101 of the Defense 
Production Act and the legislative history of section 101.\5\ 
Specifically, allocation authority would only be used when priority 
authority is unable to provide a sufficient supply of a material, 
service, or facility to meet the national defense, or when the use of 
priority authority would cause a severe and prolonged disruption in the 
supply of materials, services, or facilities available to support 
normal U.S. economic activities.
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    \5\ Legislative history indicates that Congress was concerned 
that national defense requirements, during times of emergency, could 
consume much of the output of key industrial sectors and selected 
producers within some sectors. Allocations authority was viewed as a 
means to ensure an equitable distribution of national defense demand 
among potential suppliers to avoid disproportionate impacts on each 
supplier's share of the civilian market.
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    Allocation authority would not be used to ration materials or 
services at the retail level. In other words, allocation authority 
would not be used to control how much of a product or service a person 
may have for personal use. For example, DOT could use allocation 
authority to require the nation's bus companies to dedicate 40% of 
their bus fleet to a designated emergency, but DOT could not use 
allocation authority to tell a bus company how to distribute its buses 
to serve its commercial customers or to tell a bus company how many 
tickets it could sell to persons in a given month.
    Allocation orders would be distributed equitably among similarly 
situated suppliers of the resources being allocated and would not 
require any person to relinquish a disproportionate share of the 
civilian market. Allocation authority would not apply to resources 
owned by the Federal Government, as those resources may be used by the 
controlling Federal entity in accordance with other governing laws. 
Nor, generally speaking, would allocation authority apply to resources 
owned by States, local governments or Native American tribes, as that 
could potentially undermine other Federal laws. For example, the 
Stafford Act is designed ``to provide an orderly and continuing means 
of assistance by the Federal Government to States and local governments 
in carrying out their responsibilities to alleviate the suffering and 
damage which results from * * * disasters. * * *'' Thus, it would be 
counterproductive for the Federal Government to consider allocating for 
its own use the very resources the State, local or tribal government 
could be counting on as part of its response efforts.
    The Civil Reserve Air Fleet (CRAF) and the Voluntary Intermodal 
Sealift Agreement (VISA) are two examples of DOT's use of its 
allocation authority.\6\ Concerning CRAF, under the terms of a 
Memorandum of Understanding, DOT develops plans and allocates aircraft 
to the CRAF program based on DoD requirements. DOT advises DoD if it 
intends to allocate fewer aircraft than requested by DoD, notifies DoD 
if a particular level of CRAF activation will have a serious adverse 
impact on the civil air carrier's ability to provide essential service, 
and works with DoD to identify alternatives or determine ways to 
minimize the impact. DOT publishes a periodic allocation of aircraft, 
by registration or ``N'' number, of each airline participating in the 
CRAF program.
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    \6\ CRAF was formed through a joint agreement between DoD and 
the Department of Commerce. Executive Order 10999 placed 
responsibility for administration of the CRAF program in the 
Department of Commerce as a function of the Office of Emergency 
Transportation. In 1967, the Office of Emergency Transportation 
transferred in its entirety with its mission, functions and staff 
into the new Department of Transportation. Responsibility for 
carrying out the Secretary's role with respect to the CRAF program 
now resides with the Office of Intelligence, Security and Emergency 
Response.
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    The VISA program is a preparedness program designed to make 
intermodal shipping services and systems available to DoD as required 
to support the emergency deployment and sustainment of U.S. military 
forces. This is done through cooperation among the

[[Page 8680]]

maritime industry, DOT and DoD pursuant to a voluntary agreement 
entered into in accordance with Section 708 of the Defense Product Act 
(50 U.S.C. App. Sec.  2158). During a Stage III activation, the 
Secretary of DoD will request the Secretary of DOT to allocate sealift 
capacity based on DoD requirements.
    Section 33.51 General procedures. The proposed procedures set out 
in this section and in proposed section 33.52 are intended to provide a 
reasonable assurance that allocation authority would only be used in 
situations where such authority is justified. Section 33.51 would set 
out the specific requirements and findings that DOT must meet before it 
could use its allocation authority.
    One requirement would be for DOT to obtain a written determination 
from either DoD, DHS or DOE, as appropriate, that the program DOT 
intends to support through its allocation authority is necessary or 
appropriate to support the national defense. As previously mentioned, 
section 202 of Executive Order 12919 requires such a finding before DOT 
can take an allocation action. Additionally, DOT would be required to 
provide a detailed description of the situation creating the need for 
allocation and the specific objectives to be obtained through the 
allocation action; a list of the materials, services, or facilities to 
be allocated, and of the sources that will be subject to the allocation 
action; a detailed description of the requirements to be contained in 
the allocation action, to include the percentage or quantity of 
capacity to be allocated and the duration of the allocation action; and 
an evaluation of the potential impact on the civilian market and 
proposed actions to mitigate any disruption of the civilian market.
    Section 33.52 Controlling the general distribution of a material in 
the civilian market. This section would provide procedures for making 
the findings required by section 101(b) of the Defense Production Act 
and section 201(d) of Executive Order 12919. Defense Production Act 
section 101(b) states that the priorities and allocations authority 
shall not be used to control the general distribution of any material 
in the civilian market unless the President finds (1) that such 
material is a scarce and critical material essential to the national 
defense, and (2) that the requirements of the national defense for such 
material cannot otherwise be met without creating a significant 
dislocation of the normal distribution of such material in the civilian 
market to such a degree as to create appreciable hardship. Section 
201(d) of Executive Order 12919 directs each agency with delegated 
authority under section 101 of the Defense Production Act to make the 
finding required by section 101(b) and submit the finding for the 
President's approval through the Assistant to the President for 
National Security Affairs. By definition under the Defense Production 
Act, services, including transportation services, are not considered a 
``material'' as contemplated in section 101(b) of the Defense 
Production Act or section 201(d) of Executive Order 12919.
    Section 33.53 Types of allocation orders. This section proposes to 
describe the three types of allocations orders DOT might issue: a set-
aside; an allocation directive; or an allotment. A set-aside is an 
official action that would require a person to reserve a resource 
capacity in anticipation of receipt of rated orders. An allocation 
directive is an official action that would require a person to take or 
refrain from taking certain actions in accordance with its provisions. 
For example, an allocation directive could require a person to stop or 
reduce production of an item or service; prohibit the use of selected 
materials, services or facilities; divert supply of one type of 
material, service or facility to another; or to supply a specific 
quantity, size, shape, and type of an item or service within a specific 
time period. An allotment is an official action that would specify the 
maximum quantity of a material, service, or facility authorized for use 
in a specific program or application.
    Section 33.54 Elements of an allocation order. This section would 
describe the minimum elements of an allocation order. These elements 
would be: (1) A detailed description of the required allocation 
action(s); (2) specific start and end calendar dates for each required 
allocation action; (3) the written signature on a manually placed 
order, or the digital signature or name on an electronically placed 
order, of the Secretary of DOT, which would certify that the order is 
authorized under this regulation and that the requirements of this part 
are being followed; (4) a statement that the order is certified for 
national defense use and that recipients are required to comply with 
the order; and (5) a copy of the Transportation Priorities and 
Allocations System regulation.
    Section 33.55 Mandatory acceptance of an allocation order. This 
section would require a person to accept and comply with allocation 
orders if the person is capable of complying. If a person is unable to 
comply fully with the required actions specified in an allocation 
order, the person would be required to notify DOT immediately, explain 
the extent to which compliance is possible, and give reasons why full 
compliance is not possible. Furthermore, notifying DOT of possible non-
compliance does not release the person from complying with the 
allocation order to the extent possible.
    This section also would state that a person may not discriminate 
against an allocation order in any manner, such as by charging higher 
prices or imposing terms and conditions on allocation orders that are 
different from what the person imposed on contracts or orders for the 
same resource prior to receiving the allocation order.
    Section 33.56 Changes or cancellations of an allocation order. This 
section would state that DOT may modify or cancel an allocation order.

Subpart F--Official Actions

    Section 33.60 General provisions. This section would set out the 
specific official actions that DOT may take to implement the provisions 
of this regulation. These official actions include Rating 
Authorizations, Directives, Planning Orders, and Memoranda of 
Understanding.
    Section 33.61 Rating authorizations. This section would define a 
rating authorization as an official action granting priority rating 
authority.
    Section 33.62 Directives. This section would define a directive as 
an official action that requires a person to take or refrain from 
taking certain actions in accordance with its provisions. A priority 
directive would take precedence over rated orders, and allocation 
directives take precedence over a priority directive.
    Section 33.63 Memoranda of Understanding. This section would 
explain that a Memorandum of Understanding is an official action that 
may be issued to reflect an agreement resolving a request for special 
priorities assistance. A Memorandum of Understanding may not be used to 
alter scheduling between rated orders, authorize the use of priority 
ratings, impose restrictions under this regulation, or take other 
official actions.

Subpart G--Compliance

    Section 33.70 General provisions. This section would clarify that 
DOT has the authority to enforce or administer the Defense Production 
Act, this regulation, or an official action. Additionally, this section 
would state that willful violations of title I or section 705 of the 
Defense Production Act, this regulation, or an official DOT action, are 
criminal acts, punishable as provided in the Defense Production Act, 
and as set forth in Sec.  33.74 below.

[[Page 8681]]

    Section 33.71 Audits and investigations. This section would provide 
the procedures for conducting audits and investigations to ensure that 
the provisions of the Defense Production Act and other applicable 
statutes, this regulation, and official actions have been properly 
followed. This provision is limited to activities conducted under DPA 
authorities and would not limit the authority of DOT elements to 
initiate and conduct audits, investigations, or other inquiries under 
their specific statutes or authorities, nor would it affect the process 
for such audits, investigations or inquiries.
    Section 33.72 Compulsory process. This section would explain the 
procedures DOT may use to seek a compulsory process if a person refuses 
to permit a duly authorized DOT representative to have access to any 
premises or any necessary information. For purposes of this regulation, 
compulsory process would mean the institution of appropriate legal 
action, including ex parte application for an inspection warrant or its 
equivalent in any forum of appropriate jurisdiction. Furthermore, 
compulsory process under this regulation may be sought in advance of an 
audit or investigation if DOT believes a person will refuse to comply 
with the audit or investigation.
    Section 33.73 Notification of failure to comply. This section would 
provide procedures for notification of failure to comply with the 
Defense Production Act, other applicable statutes, this regulation, or 
an official DOT action.
    Section 33.74 Violations, penalties, and remedies. This section 
would set out the penalties and related actions the Government may take 
for violations of the provisions of title I or sections 705 or 707 of 
the Defense Production Act, the priorities provisions of the Selective 
Service Act, when applicable, this regulation, or an official DOT 
action.
    Section 33.75 Compliance conflicts. This section would require 
persons to immediately notify DOT if compliance with any provision of 
the Defense Production Act, other applicable statutes, this part, or an 
official action would prevent a person from filling a rated order or 
from complying with another provision of the Defense Production Act, 
other applicable statutes, this regulation, or an official action.

Subpart H--Adjustments, Exceptions, and Appeals

    Section 33.80 Adjustments or exceptions. This section would 
describe the procedures necessary to request an adjustment or exception 
to a provision of this regulation or an official action on the grounds 
that it would create an undue or exceptional hardship or compliance is 
contrary to the intent of the Defense Production Act or this 
regulation. Such requests must be submitted in writing and the 
submission of a request for adjustment or exception does not relieve 
the requester from compliance while the request is being considered by 
DOT.
    Section 33.81 Appeals. This section would provide procedures and 
timeframes for appealing a decision denying relief from a request for 
an adjustment or exception under this regulation. This section would 
provide for an expedited procedure for appeals involving a rated order 
placed for the purpose of emergency preparedness.

Subpart I--Miscellaneous Provisions

    Section 33.90 Protection against claims. This section would provide 
that a person shall not be held liable for damages or penalties for any 
act or failure to act resulting directly or indirectly from compliance 
with any provision of this regulation or an official action. This 
``hold harmless'' provision applies even if any provision of this 
regulation or action is subsequently declared to be invalid by judicial 
or other competent authority.
    Section 33.91 Records and reports. This section would require 
persons to create and preserve for at least three years accurate and 
complete records of any transaction covered by this regulation or an 
official action. This section also would detail the various 
requirements pertaining to the required records and reports. In 
addition, this section would describe the confidentiality provision of 
the Defense Production Act pertaining to information submitted under 
the Defense Production Act or this regulation.
    Section 33.92 Applicability of this part and official actions. This 
section would establish the jurisdictional applicability of this 
regulation.
    Section 33.93 Communications. This section would provide DOT 
contact information for communications concerning this regulation.

III. Regulatory Analyses and Notices

A. Executive Order 12866--Regulatory Planning and Review

    This proposed rule is a ``significant regulatory action'' under 
section 3(f) of Executive Order 12866, Regulatory Planning and Review. 
While the requirements under title I of the Defense Production Act have 
been in existence for years, these proposed regulations are new to the 
transportation industry and could be considered to raise novel legal or 
policy issues under section 3(f)(4) of Executive Order 12866. The 
proposed rule is not economically significant, however, as it would not 
have an annual economic impact of over $100 million.

B. Executive Order 13132--Federalism

    This proposed rule has been analyzed in accordance with the 
principles and criteria contained in Executive Order 13132, Federalism. 
This proposed rule would not have a substantial direct effect on, or 
sufficient federalism implications for, the States, nor would it limit 
the policymaking discretion of the States. Therefore, the consultation 
requirements of Executive Order 13132 do not apply.

C. Executive Order 13175--Consultation and Coordination With Indian 
Tribal Governments

    This proposed rule has been analyzed in accordance with the 
principles and criteria contained in Executive Order 13175 Consultation 
and Coordination with Indian Tribal Governments. Because this proposed 
rule would not significantly or uniquely affect the communities of the 
Indian tribal governments and would not impose substantial direct 
compliance costs, the funding and consultation requirements of 
Executive Order 13175 would not apply.

D. Regulatory Flexibility Act

    The Regulatory Flexibility Act (5 U.S.C. 601 et seq.) requires an 
agency to review regulations to assess their impact on small entities 
unless the agency determines that a rule is not expected to have 
significant impact on a substantial number of small entities.
Potentially Affected Small Entities
    Small entities include small businesses, small organizations and 
small governmental jurisdictions. For purposes of assessing the impacts 
of this proposed rule on small entities, a small business, as described 
in the Small Business Administration's Table of Small Business Size 
Standards Matched to North American Industry Classification System 
Codes (August 2008 Edition), has a maximum annual revenue of $33.5 
million and a maximum of 1,500 employees (for some business categories, 
these numbers are lower). A small governmental jurisdiction is a 
government of a city, town, school district or special district with a 
population of less than 50,000. A small organization is any not-for-
profit enterprise that is independently owned and operated and is not 
dominant in its field.

[[Page 8682]]

    This proposed regulation would set criteria under which DOT would 
authorize prioritization of certain orders or contracts, as well as 
criteria under which DOT would issue orders allocating materials, 
services, or facilities. Because the proposed rule would mainly be used 
for larger commercial transportation operations, DOT believes that 
small organizations and small governmental jurisdictions are unlikely 
to be affected by this proposed rule. To date, DOT has not exercised 
its existing priorities authority and has only exercised its existing 
allocations authority for one aviation program and one sealift program, 
both of which rely on voluntary engagement by industry. Therefore, DOT 
has no basis on which to estimate the number of small businesses that 
might be affected by promulgation of this proposed rule.
Potential Impacts
    Although DOT cannot determine precisely the number of small 
entities that would be affected by this proposed rule, DOT believes 
that the overall impact on such entities would not be significant. In 
most instances, rated contracts would be fulfilled in addition to other 
(unrated) contracts and could actually increase the total amount of 
business for a firm that receives a rated contract. DOT expects that 
allocations would be ordered only in extraordinary circumstances, other 
than in the two well-established, voluntary programs discussed above. 
Furthermore, DOT believes that the provisions of section 701(e) of the 
Defense Production Act, which requires that small businesses be 
considered in allocations, indicate that any impact on small business 
would not be significant.
Conclusion
    Therefore, for the reasons set forth above, I certify that this 
proposed rule, if implemented, would not have a significant economic 
impact on a substantial number of small entities.

E. Paperwork Reduction Act

    This proposed rule contains an information collection requirement. 
As required by the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-
3520), DOT has submitted the information requirement to the Office of 
Management and Budget (OMB) for review. DOT estimates that the public 
reporting burden for submission of Form OST F 1254 is an average of 30 
minutes per response, including the time for reviewing instructions, 
searching existing data sources, gathering and maintaining the data 
needed, and completing and reviewing the collection of information.
    DOT is seeking public comment on any aspect of the information 
collection, including: (1) Whether the proposed collection is necessary 
for DOT's performance; (2) the accuracy of the estimate burdens; (3) 
ways for DOT to enhance the quality, usefulness, and clarity of the 
collected information; and (4) ways that the burden could be minimized 
without reducing the quality of the collected information. 
Organizations and individuals desiring to submit comments on the 
collection of information should direct them to the Office of 
Management and Budget, Attention: Desk Officer for the Office of the 
Secretary of Transportation, Office of Information and Regulatory 
Affairs, Washington, DC 20505. Comments should also be sent to the 
Department of Transportation, Attn: Defense Production Act Activities 
Coordinator, Office of Intelligence, Security, and Emergency Response, 
1200 New Jersey Avenue, SE., Washington DC 20590.
    We will respond to any OMB or public comments on the information 
collection requirement contained in this proposed rule. DOT may not 
impose a penalty on persons for violating information collection 
requirements that do not display a current OMB control number, if 
required. DOT intends to obtain a current OMB control number for the 
information collection requirements that would result from this 
proposed rulemaking action. The OMB control number, when assigned, will 
be announced by separate notice in the Federal Register.

List of Subjects in 49 CFR Part 33

    Administrative practice and procedure, Business and industry, 
Government contracts, National Defense, Reporting and recordkeeping 
requirements, Strategic and critical materials, Transportation.

Raymond LaHood,
Secretary of Transportation.

    In consideration of the foregoing, the Department proposes to add 
Part 33 of Title 49, Code of Federal Regulations, to read as follows:

PART 33--TRANSPORTATION PRIORITIES AND ALLOCATION SYSTEM

Subpart A--General
Sec.
33.1 Purpose of this part.
33.2 Priorities and allocations authority.
33.3 Program eligibility.
Subpart B--Definitions
33.20 Definitions.
Subpart C--Placement of Rated Orders
33.30 Delegation of authority.
33.31 Priority ratings.
33.32 Elements of a rated order.
33.33 Acceptance and rejection of rated orders.
33.34 Preferential scheduling.
33.35 Extension of priority ratings.
33.36 Changes or cancellations of priority ratings and rated orders.
33.37 Use of rated orders.
33.38 Limitations on placing rated orders.
Subpart D--Special Priorities Assistance
33.40 General provisions.
33.41 Requests for priority rating authority.
33.42 Examples of assistance.
33.43 Criteria for assistance.
33.44 Instances where assistance may not be provided.
33.45 [Reserved]
Subpart E--Allocation Actions
33.50 Policy.
33.51 General procedures.
33.52 Controlling the general distribution of a material in the 
civilian market.
33.53 Types of allocation orders.
33.54 Elements of an allocation order.
33.55 Mandatory acceptance of an allocation order.
33.56 Changes or cancellations of an allocation order.
Subpart F--Official Actions
33.60 General provisions.
33.61 Rating Authorizations.
33.62 Directives.
33.63 Memoranda of Understanding.
Subpart G--Compliance
33.70 General provisions.
33.71 Audits and investigations.
33.72 Compulsory process.
33.73 Notification of failure to comply.
33.74 Violations, penalties, and remedies.
33.75 Compliance conflicts.
Subpart H--Adjustments, Exceptions, and Appeals
33.80 Adjustments or exceptions.
33.81 Appeals.
Subpart I--Miscellaneous Provisions
33.90 Protection against claims.
33.91 Records and reports.
33.92 Applicability of this part and official actions.
33.93 Communications.
Appendix I to Part 33--Sample Form OST F 1254
Appendix II to Part 33--Schedule 1 Approved Programs

    Authority:  Defense Production Act of 1950, as amended, 50 
U.S.C. App. 2061-2171; Executive Order 12919, as amended, (59 FR 
29525, June 7, 1994).

Subpart A--General


Sec.  33.1  Purpose of this part.

    This part provides guidance and procedures for use of the Defense 
Production Act priorities and allocations authority with respect to all 
forms of civil transportation. The

[[Page 8683]]

guidance and procedures in this part are generally consistent with the 
guidance and procedures provided in other regulations that, as a whole, 
form the Federal Priorities and Allocations System. Guidance and 
procedures for use of the Defense Production Act priorities and 
allocations authority with respect to other types of resources are 
provided for: food resources, food resource facilities, and the 
domestic distribution of farm equipment and commercial fertilizer in 
the Agricultural Priorities and Allocation Systems at 7 CFR part 700; 
all forms of energy in the Energy Priorities and Allocations System 
regulation at 10 CFR part 217; health resources in the Health Resources 
Priorities and Allocations System at [CFR citation to be inserted in 
the final rule]; water resources in the Water Resources Priorities and 
Allocations System at [CFR citation to be inserted in the final rule]; 
and all other materials, services, and facilities, including 
construction materials in the Defense Priorities and Allocations System 
(DPAS) regulation at 15 CFR part 700.


Sec.  33.2  Priorities and allocations authority.

    (a) Section 201 of Executive Order 12919 (59 FR 29525) delegates 
the President's authority under section 101 of the Defense Production 
Act to require acceptance and priority performance of contracts and 
orders (other than contracts of employment) to promote the national 
defense over performance of any other contracts or orders, and to 
allocate materials, services, and facilities as deemed necessary or 
appropriate to promote the national defense to:
    (1) The Secretary of Agriculture with respect to food resources, 
food resource facilities, and the domestic distribution of farm 
equipment and commercial fertilizer;
    (2) The Secretary of Energy with respect to all forms of energy;
    (3) The Secretary of Health and Human Services with respect to 
health resources;
    (4) The Secretary of Transportation with respect to all forms of 
civil transportation;
    (5) The Secretary of Defense with respect to water resources; and
    (6) The Secretary of Commerce for all other materials, services, 
and facilities, including construction materials.
    (b) Section 202 of Executive Order 12919 states that the priorities 
and allocations authority delegated in section 201 of the order may be 
used only to support programs that have been determined in writing as 
necessary or appropriate to promote the national defense:
    (1) By the Secretary of Defense with respect to military production 
and construction, military assistance to foreign nations, stockpiling, 
outer space, and directly related activities;
    (2) By the Secretary of Energy with respect to energy production 
and construction, distribution and use, and directly related 
activities; and
    (3) By the Secretary of Homeland Security with respect to essential 
civilian needs supporting national defense, including civil defense and 
continuity of government and directly related activities.


Sec.  33.3  Program eligibility.

    Certain programs to promote the national defense are eligible for 
priorities and allocations support. These include programs for military 
and energy production or construction, military or critical 
infrastructure assistance to any foreign nation, homeland security, 
stockpiling, space, and any directly related activity. Other eligible 
programs include emergency preparedness activities conducted pursuant 
to title VI of the Robert T. Stafford Disaster Relief and Emergency 
Assistance Act (42 U.S.C. 5195 et seq.) and critical infrastructure 
protection and restoration.

Subpart B--Definitions


Sec.  33.20  Definitions.

    The following definitions pertain to all sections of this part:
    ``Allocation'' means the control of the distribution of materials, 
services, or facilities for a purpose deemed necessary or appropriate 
to promote the national defense.
    ``Allocation authority'' means the authority of the Department of 
Transportation, pursuant to section 101 of the Defense Production Act, 
to allocate materials, services, and facilities for use in approved 
programs.
    ``Allocation order'' means an official action to control the 
distribution of materials, services, or facilities for a purpose deemed 
necessary or appropriate to promote the national defense.
    ``Allotment '' means an official action that specifies the maximum 
quantity of a material, service, or facility authorized for a specific 
use to promote the national defense.
    ``Approved program'' means a program determined by the Secretary of 
Defense, the Secretary of Energy, or the Secretary of Homeland Security 
to be necessary or appropriate to promote the national defense, in 
accordance with section 202 of Executive Order 12919.
    ``Civil transportation'' includes movement of persons and property 
by all modes of transportation in interstate, intrastate, or foreign 
commerce within the United States, its territories and possessions, and 
the District of Columbia, and, without limitation, related public 
storage and warehousing, ports, services, equipment and facilities, 
such as transportation carrier shop and repair facilities. However, 
``civil transportation'' shall not include transportation owned or 
controlled by the Department of Defense, use of petroleum and gas 
pipelines, and coal slurry pipelines used only to supply energy 
production facilities directly. As applied herein, ``civil 
transportation'' shall include direction, control, and coordination of 
civil transportation capacity regardless of ownership.
    ``Construction'' means the erection, addition, extension, or 
alteration of any building, structure, or project, using materials or 
products which are to be an integral and permanent part of the 
building, structure, or project. Construction does not include 
maintenance and repair.
    ``Critical infrastructure'' means any systems and assets, whether 
physical or cyber-based, so vital to the United States that the 
degradation or destruction of such systems and assets would have a 
debilitating impact on national security, including, but not limited 
to, national economic security and national public health or safety.
    ``Defense Production Act'' means the Defense Production Act of 
1950, as amended (50 U.S.C. App. 2061 et seq.).
    ``Delegate Agency'' means a government agency authorized by 
delegation from the Department of Transportation to place priority 
ratings on contracts or orders needed to support approved programs.
    ``Directive'' means an official action that requires a person to 
take or refrain from taking certain actions in accordance with its 
provisions.
    ``Emergency preparedness'' means all those activities and measures 
designed or