Annual Charges for Use of Government Lands in Alaska, 41359-41364 [2017-17846]
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41359
Proposed Rules
Federal Register
Vol. 82, No. 168
Thursday, August 31, 2017
This section of the FEDERAL REGISTER
contains notices to the public of the proposed
issuance of rules and regulations. The
purpose of these notices is to give interested
persons an opportunity to participate in the
rule making prior to the adoption of the final
rules.
DEPARTMENT OF ENERGY
Federal Energy Regulatory
Commission
18 CFR Part 11
[Docket No. RM16–19–000]
Annual Charges for Use of
Government Lands in Alaska
Federal Energy Regulatory
Commission, Department of Energy.
ACTION: Notice of proposed rulemaking.
AGENCY:
The Federal Power Act
requires hydropower licensees to
recompense the United States for the
use, occupancy, and enjoyment of
federal lands. The Commission assesses
SUMMARY:
annual charges for the use of federal
lands through Part 11 of its regulations.
The Commission proposes to revise the
per-acre land value component of its
methodology for calculating these
annual charges for hydropower projects
located in Alaska. Under the proposed
rule, the Commission would calculate a
statewide average per-acre land value
for hydropower lands in Alaska. The
Commission would use the statewide
average per-acre land value, rather than
a regional per-acre land value, to
calculate annual charges for use of
federal lands for all hydropower
projects in Alaska, except those located
in the Aleutian Islands Area.
DATES: Comments are due October 30,
2017.
ADDRESSES: Comments, identified by
docket number, may be filed in the
following ways:
• Electronic Filing through https://
www.ferc.gov. Documents created
electronically using word processing
software should be filed in native
applications or print-to-PDF format and
not in a scanned format.
• Mail/Hand Delivery: Those unable
to file electronically may mail or handdeliver comments to: Federal Energy
Regulatory Commission, Secretary of the
Commission, 888 First Street NE.,
Washington, DC 20426.
Instructions: For detailed instructions
on submitting comments and additional
information on the rulemaking process,
see the Comment Procedures section of
this document
FOR FURTHER INFORMATION CONTACT:
Tara DiJohn (Legal Information), Office
of the General Counsel, Federal
Energy Regulatory Commission, 888
First Street NE., Washington, DC
20426, (202) 502–8671, tara.dijohn@
ferc.gov.
Norman Richardson (Technical
Information), Office of the Executive
Director, Federal Energy Regulatory
Commission, 888 First Street NE.,
Washington, DC 20426, (202) 502–
6219, norman.richardson@ferc.gov.
SUPPLEMENTARY INFORMATION:
Table of Contents
Paragraph
Nos.
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I. Background ......................................................................................................................................................................................
A. Order No. 774 .........................................................................................................................................................................
1. Per-Acre Land Value ........................................................................................................................................................
2. Per-Acre Land Values for Alaska ....................................................................................................................................
B. Fiscal Year 2016 Fee Schedule ..............................................................................................................................................
C. Petition for Rulemaking .........................................................................................................................................................
II. Notice of Inquiry ............................................................................................................................................................................
III. Proposed Rule ...............................................................................................................................................................................
IV. Regulatory Requirements .............................................................................................................................................................
A. Information Collection Statement .........................................................................................................................................
B. Environmental Analysis .........................................................................................................................................................
C. Regulatory Flexibility Act ......................................................................................................................................................
D. Comment Procedures .............................................................................................................................................................
E. Document Availability ............................................................................................................................................................
1. The Federal Power Act (FPA)
requires hydropower licensees that use
federal lands to compensate the United
States for the use, occupancy, and
enjoyment of federal lands.1 Currently,
the Commission uses a fee schedule,
based on the U.S. Bureau of Land
Management’s (BLM) methodology for
calculating rental rates for linear rights
of way, to calculate annual charges for
use of federal lands. The Commission’s
fee schedule identifies a fee for each
county or geographic area, which is the
product of four components: A per-acre
1 16
land value, an encumbrance factor, a
rate of return, and an annual adjustment
factor. The per-acre land value for a
particular county or geographic area
(i.e., a regional per-acre land value) is
determined using the average per-acre
land value identified by the National
Agricultural Statistics Service (NASS)
Census. Under the proposed rule, the
Commission would use a statewide
average per-acre land value for the state
of Alaska, rather than a regional per-acre
land value.
U.S.C. 803(e)(1) (2012).
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I. Background
2. Section 10(e)(1) of the FPA requires
Commission hydropower licensees
using federal lands to pay reasonable
annual charges, as determined by the
Commission, to recompense the United
States for the use and occupancy of its
lands.2 While the Commission may
periodically adjust these charges, it
must seek to avoid increasing the price
2 16 U.S.C. 803(e)(1) (2012). Section 10(e)(1) also
requires licensees to reimburse the United States for
the costs of administering Part I of the FPA. Those
charges are calculated and billed separately from
the land use charges, and are not the subject of this
proposed rule.
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to power consumers by such charges.3
In other words, licensees that use and
occupy federal lands for project
purposes must compensate the United
States through payment of an annual
fee, to be established by the
Commission.4
3. The Commission has adopted
various methods over the years to
accomplish this statutory directive.5
Currently, the Commission uses a fee
schedule method, based on land values
published in the NASS Census, to
calculate annual charges for use of
government lands. The Commission
adopted this approach in a final rule
issued on January 12, 2013.6
A. Order No. 774
4. In Order No. 774, the Commission
adopted a fee schedule method for
calculating annual charges for use of
government lands, based on BLM’s
methodology for calculating rental rates
for linear rights of way. Pursuant to
section 11.2 of the Commission’s
regulations, the Commission publishes
an annual fee schedule which lists peracre rental fees by county or geographic
area.7 To calculate a licensee’s annual
charge for use of government lands, the
Commission multiplies the applicable
county or geographic area per-acre fee
identified in the fee schedule by the
number of federal acres used by the
hydroelectric project, as reported by that
licensee.
5. The per-acre rental fee for a
particular county or geographic area is
calculated by multiplying four
components: (1) A per-acre land value;
(2) an encumbrance factor; (3) a rate of
return; and (4) an annual adjustment
factor.
1. Per-Acre Land Value
6. The first component—the per-acre
land value—is based on average per-acre
land values published in the NASS
Census. Specifically, the per-acre land
value is determined by the applicable
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3 Id.
4 Pursuant to FPA section 17(a), 16 U.S.C. 810(a)
(2012), the fees collected for use of government
lands are allocated as follows: 12.5 percent is paid
into the Treasury of the United States, 50 percent
is paid into the federal reclamation fund, and 37.5
percent is paid into the treasuries of the states in
which particular projects are located. No part of the
fees discussed in this proposed rule is used to fund
the Commission’s operations.
5 See Annual Charges for Use of Government
Lands, Order No. 774, FERC Stats. & Regs. ¶ 31,341,
at PP 3–20 (2013) (cross-referenced at 142 FERC ¶
61,045) (examining the myriad methodologies the
Commission has used or considered for assessing
annual charges for the use of government lands
since 1937) (Order No. 774).
6 See generally, Order No. 774.
7 18 CFR 11.2 (2017). The fee schedule is
published annually as part of Appendix A to Part
11 of the Commission’s regulations.
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county or geographic area ‘‘land and
buildings’’ category 8 from the NASS
Census. This NASS-published per-acre
value is then reduced by the sum of a
state-specific modifier (to remove the
value of irrigated lands) and seven
percent (to remove the value of
buildings or other improvements). The
end result is the adjusted per-acre land
value.
7. The NASS Census is conducted
every five years, with an 18-month
delay before NASS publishes the census
data. The Commission incorporates
another 18-month delay to account for
revisions, consistent with BLM’s
implementation of its 2008 rule.
Therefore, the Commission based the
2011–2015 fee schedules on data from
the 2007 NASS Census. The
Commission’s 2016–2020 fee schedules
will be based on data from the 2012
NASS Census; the 2021–2025 fee
schedules will be based on data from
the 2017 NASS Census; the 2026–2030
fee schedules will be based on data from
the 2022 NASS Census; and so on.
State-specific adjustments to the peracre land value are performed in the
first year that data from a new NASS
Census are used, and will remain the
same until the subsequent NASS Census
data are used to calculate the
forthcoming set of fee schedules.
2. Per-Acre Land Values for Alaska
8. With regard to Alaska, Order No.
774 explained that the final rule would
adopt BLM’s approach to per-acre land
values by designating lands in Alaska as
part of one of the five NASS Census
geographic area identifiers: The
Aleutian Islands Area, the Anchorage
Area, the Fairbanks Area, the Juneau
Area, and the Kenai Peninsula Area.
Several commenters asserted that a peracre statewide value, a category also
reported by the NASS Census, should be
used to establish assessments for federal
land in Alaska.9
9. Order No. 774 considered the
arguments raised in support of a
statewide per-acre value. In particular,
several commenters asserted that it is
inappropriate to use regional per-acre
values for Alaska because Alaska does
not use county designations; the number
of farms surveyed for the NASS Census
in the entire state of Alaska is less than
the number of farms surveyed in most
counties in the lower-48 states; and,
certain per-acre land values near
8 The ‘‘land and buildings’’ is a combination of all
land use categories in the NASS Census, including
croplands (irrigated and non-irrigated),
pastureland/rangeland, woodland, and ‘‘other’’
(roads, ponds, wasteland, and land encumbered by
non-commercial/non-residential buildings).
9 Order No. 774 at P 44.
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Anchorage and Juneau are very high,
resulting in a substantial increase in
annual charges for the use of
government lands by hydropower
licensees in these areas. However, the
Commission ultimately concluded that
the commenters had not advanced a
sufficient explanation for why it was
more appropriate to use a statewide peracre value for Alaska, rather than the
smallest NASS Census defined area for
Alaska—the geographic area identifier.
Although the Commission rejected the
use of a statewide per-acre land value
for Alaska in Order No. 774, the
Commission clarified that it would not
use rates based on the Anchorage Area
and the Juneau Area values to assess
annual land use charges ‘‘because these
high, urban-based rates would not
reasonably reflect the value of
government lands on which
hydropower projects are located.’’ 10
Instead, for purposes of determining a
per-acre land value, the Commission
decided to use the Kenai Peninsula Area
per-acre land value for projects located
in the Anchorage Area or the Juneau
Area.
B. Fiscal Year 2016 Fee Schedule
10. The Commission used the 2012
NASS Census data to calculate its fee
schedule for the first time in Fiscal Year
(FY) 2016. Due to per-acre land value
increases in the 2012 NASS Census
data, hydropower projects located in
certain geographic areas in Alaska
experienced a significant increase in
federal land use charges when
compared to the rates assessed in FY
2015.11
C. Petition for Rulemaking
11. On June 6, 2016, the Alaska
Federal Land Fees Group, comprising
six hydroelectric licensees with projects
in Alaska (Alaska Group),12 petitioned
the Commission to conduct a
rulemaking to revise its method of
calculating federal land use charges for
hydropower projects in Alaska. The
Alaska Group’s petition focuses solely
on the first component of the
Commission’s fee schedule—the peracre land value—and requests that the
Commission: (1) Calculate an adjusted
statewide average per-acre land value
for Alaska and (2) apply this adjusted
10 Id.
at P 45.
the 2012 NASS Census, changes in land
values in other parts of the country varied widely:
Some rose significantly, some rose by relatively
small amounts, and some decreased.
12 Alaska Electric Light and Power, Bradley Lake
Project Management Committee (on behalf of
licensee Alaska Energy Authority), Chugach Electric
Association, the Ketchikan Public Utilities, Copper
Valley Electric Association, and Southeast Alaska
Power Agency.
11 In
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statewide average per-acre fee to all
projects in Alaska, except those located
in the Aleutian Islands area.13
12. In support of this proposal, the
Alaska Group states that due to the
small number of farms (and associated
acreage) that contribute to the data
compiled in the NASS Census, there is
insufficient data in any individual
Alaska area (with the exception of the
Aleutian Islands) 14 to produce a fair
estimate of land values within that area.
Because there are so few farms outside
of the Aleutian Islands area, the Alaska
Group indicates that the per-acre land
values in the other four geographic areas
of Alaska are extremely sensitive to any
changes in the voluntary, self-reported
farm data compiled by the NASS
Census.
13. For these reasons, the Alaska
Group asserts that an adjusted statewide
average per-acre land value would better
reflect the diverse topography of the
state and insulate against land value
fluctuations caused by individual
changes in farm data. The Alaska Group
believes that this method would
produce a more accurate estimate of the
fair market value of federal lands in
Alaska.
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II. Notice of Inquiry
14. On November 17, 2016, the
Commission issued a Notice of Inquiry
soliciting input on a narrow question
related to its current methodology for
calculating annual charges for the use of
government lands—whether regional
per-acre land values based on data
published in the NASS Census ‘‘land
and buildings’’ category result in
reasonably accurate land valuations for
projects that occupy federal lands in
Alaska. In response to the proposal
advanced by the Alaska Group’s petition
for rulemaking, the Notice of Inquiry
requested comments on several specific
questions. First, the Commission asked
whether it should use a statewide
average per-acre land value rather than
a regional per-acre land value to
calculate the adjusted per-acre land
value for projects that occupy federal
lands in Alaska. Second, if a statewide
average per-acre value is preferred, the
13 The Alaska Group requests that any project
located in the Aleutian Islands Area continue to be
assessed annual charges for use of government
lands based on a regional per-acre land value.
14 The Alaska Group contends that because the
Aleutian Islands Area contains the greatest amount
of farmland in the state (668,016 acres), the NASS
Census data for the Aleutian Islands Area is
‘‘robust, reliable, and an accurate estimate of fair
market value.’’ Alaska Group’s June 6, 2016 Petition
for Rulemaking at 18. Therefore, the Alaska Group
requests that the proposed statewide average peracre land value be applied to all hydropower
projects located in Alaska, except those projects
located in the Aleutian Islands Area.
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Commission sought input on whether
the statewide value should be applied to
(i) all projects in Alaska, or (ii) all
projects in Alaska except those located
in the Aleutian Islands Area. Finally,
the Commission requested commenters
to identify which of the five geographic
regions of Alaska it should use to
calculate the statewide average per-acre
land value.
15. In addition, the Notice of Inquiry
encouraged commenters to submit
alternative proposals for determining a
reasonably accurate per-acre land value
for projects in Alaska, provided that the
proposed calculation was based on data
published in the NASS Census. The
notice also invited federal land
management agencies to comment on
how they would view reductions in
annual charges for the lands they
administer.
16. The Notice of Inquiry identified
five requirements that any proposed
methodology should satisfy, derived
from the Commission’s statutory
obligations under the FPA 15 and the
Commission’s past experience in
implementing various methodologies.
Any proposed methodology must: (1)
Apply uniformly to all licensees in
Alaska; (2) avoid exorbitant
administrative costs; (3) not be subject
to review on an individual basis; (4)
reflect reasonably accurate land
valuations; and (5) avoid an
unreasonable increase in costs to
consumers.
17. In response to the Notice of
Inquiry, seven entities filed comments:
The Alaska Group; U.S. Senator Lisa
Murkowski; Homer Electric Association,
Inc. (Homer Electric); Kodiak Electric
Association, Inc. (Kodiak Electric); the
U.S. Forest Service (Forest Service); Erin
Noakes; and Chelsea Liddell.
18. The Alaska Group filed comments
reiterating its position that the
Commission should adopt a statewide
average per-acre land value for all
hydropower projects in Alaska, and that
the statewide average should be applied
to all projects in Alaska, except those
located in the Aleutian Islands Area.
The Alaska Group states that it does not
believe that the Commission needs to
change its methodology for calculating
annual charges for the Aleutian Islands
Area since the substantial amount of
agricultural acreage represented in the
NASS Census data results in a fair
estimate of land values for this
particular region.
19. In support of its position, the
Alaska Group states that the use of a
statewide average per-acre land value
would provide ‘‘a more robust and
15 See
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16 U.S.C. 803(e)(1) (2012).
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41361
representative assessment of fair market
value of federal lands in [the Kenai and
Fairbanks] areas of Alaska, because it
draws on a larger and more diverse
dataset from across the state, and
ensures that rates are less prone to
fluctuation over time.’’ 16 According to
the Alaska Group, if the Commission
were to adopt a statewide average peracre land value for Alaska, it would
recognize several unique burdens faced
by Alaska hydropower licensees and
ratepayers, including the exclusive
responsibility borne by Alaska
ratepayers for all costs associated with
hydropower projects, including annual
charge assessments and the
predominance of federal acreage in
Alaska.
20. Senator Murkowski urges the
Commission to use a statewide average
per-acre land value, stating that the
NASS Census data does not provide an
accurate accounting of land values in
Alaska because the state has fewer farms
and farm acreage than any other state in
the Pacific Northwest. Homer Electric,
an electric distribution cooperative that
provides service in the Kenai Peninsula,
agrees with Senator Murkowski’s
comments that the NASS Census data
does not provide an accurate accounting
of Alaskan land values. Homer Electric
also urges the Commission to adopt a
statewide average per-acre land value
for Alaska.
21. Kodiak Electric, a licensee of a
hydropower project located in the
Aleutian Islands Area, states that the
regional per-acre land values published
in the NASS Census result in reasonably
accurate land valuations for hydropower
lands in the Aleutian Islands Area.
Because of the large number of
agricultural acreage reported by the
NASS Census for the Aleutian Islands
Area, Kodiak Electric believes no
changes to the Commission’s current
methodology are needed for this
geographic region. If the Commission
decides to adopt a statewide average
per-acre land value for hydropower
projects in Alaska, Kodiak Electric
recommends that the Commission
refrain from applying the statewide
value to projects located in the Aleutian
Islands Area.
22. The Forest Service observes that
from an economic perspective the use of
a statewide average per-acre land value
for Alaska, derived from data published
in the NASS Census, would result in a
significant reduction in rental rates for
the land in question. However, the
Forest Service states that it does not
recommend the use of a fee schedule
16 The Alaska Group’s January 24, 2017
Comments on Notice of Inquiry at 16–17.
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based on NASS Census data for Alaska
because of the small number of farms in
the state. Instead, the Forest Service
recommends that the Commission
calculate federal land charges for Alaska
using BLM’s ‘‘Minimum Rent Schedule
for BLM Land Use Authorizations in
Alaska 2015.’’ The Forest Service also
suggests that the Commission consider a
fee based on power generated, similar to
BLM’s solar fee schedule.
23. Erin Noakes and Chelsea Liddell
each filed individual comments
recommending that the Commission
decline the request to alter its current
methodology for calculating federal land
charges for hydropower projects in
Alaska. Ms. Noakes observes that the
use of a statewide average per-acre land
value may result in the under-collection
of reasonable annual charges for the use
of federal lands by hydropower projects
in Alaska. Ms. Liddell asserts that the
Alaska Group has not sufficiently
demonstrated that a statewide average
per-acre land value would be any more
accurate than a regional per-acre land
value.
III. Proposed Rule
24. The Commission proposes to
adopt the use of a statewide average peracre land value, rather than a regional
per-acre land value, for the purposes of
calculating annual charges for
hydropower projects that occupy federal
lands in Alaska.
25. To calculate the statewide average
per-acre land value for Alaska, the
Commission will average the data
published in the ‘‘lands and buildings’’
category of the NASS Census for two
geographic areas: the Kenai Peninsula
Area and the Fairbanks Area.17 Pursuant
to the Commission’s current
methodology, this statewide average
will be reduced by Alaska’s statespecific reduction to remove the value
of irrigated lands, as well as a seven
percent reduction to remove the value of
buildings. The Commission will apply
the resulting adjusted statewide average
per-acre land value to all hydropower
projects in Alaska except for projects
located in the Aleutian Islands Area.
Because of the large amount of farmland
acreage represented in the NASS Census
for the Aleutian Islands Area, the
Commission is satisfied that the NASS
Census data for this geographic area
results in reasonably accurate per-acre
land values. Therefore, the Commission
17 As we noted earlier, the Commission does not
use the NASS Census data from the Anchorage Area
or the Juneau Area for the purpose of determining
per-acre land values because the predominantly
high, urban-based rates do not reasonably reflect the
value of government lands on which hydropower
projects are located. See supra P 9.
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will continue to apply the regional peracre land value for the Aleutian Islands
Area.
26. We believe this proposal responds
to the issues identified by the
petitioners—the prevalence of federal
lands in Alaska, the sparse amount of
agricultural acreage reflected in the
NASS Census, and the increase in
annual charges that resulted when the
Commission began using data from the
2012 NASS Census. Combining the
value of the farmland acreage in the
Kenai Peninsula and Fairbanks Areas to
calculate a statewide average land value
will result in a larger, more robust data
set. A larger data set will be less prone
to future fluctuation due to changes in
the level of participation in NASS
Census data reporting or specific
anomalies in the data reported. We are
satisfied that a statewide average peracre land value based on the NASS
Census data from the ‘‘land and
buildings’’ category for the Kenai
Peninsula and Fairbanks Areas will
result in reasonably accurate land
values for hydropower projects that
occupy federal lands in Alaska.
27. While the Commission is
proposing to implement a statewide
average per-acre land value to address
these concerns, we are not persuaded
that the Aleutian Islands Area values,
which are lower than land values
elsewhere in the state, should be used
in calculating a statewide average that is
applied to hydropower projects located
outside of the Aleutian Islands Area.
28. The Forest Service recommends
that the Commission employ a method
based on the 2015 Minimum Rent
Schedule for BLM Land Use
Authorizations in Alaska.18 Following
an analysis of this alternative,
Commission staff concluded that the use
of BLM’s Minimum Rent Schedule
would result in higher per-acre fees
compared to the Commission’s current
methodology. BLM’s Minimum Rent
Schedule for Alaska uses land values
based on rural sales data. The
underlying land values for the Kenai
Peninsula, Fairbanks, and Aleutian
Islands Areas are all higher than the
corresponding land values published in
the NASS Census. The Commission
does not believe that there is sufficient
justification for using—only for
Alaska—BLM’s Minimum Rent
18 See generally BLM, Rent for Remote NonLinear Rights-of-Way, Permits and Leases, https://
www.blm.gov/policy/im-ak-2015-010 (instruction
memorandum describing the U.S. Department of the
Interior—Office of Valuation Services’ April 2015
Minimum Rent Analysis & Schedule, which
provides guidance and a rental schedule for land
use authorizations of up to 25 acres across each of
BLM’s district and field offices in Alaska).
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Schedule, instead of continuing to use
NASS Census data to establish federal
land use charges for all areas of the
country.
29. In addition, the Forest Service
suggests that the Commission consider a
fee based on power generated, similar to
the solar fee schedule. For solar energy
right-of-way authorizations, BLM
charges a combined rent and fee
consisting of an acreage rent paid
annually regardless of the stage of
development, and a megawatt capacity
fee paid annually once electricity
generation begins.19 BLM uses per-acre
data from the ‘‘land and buildings’’
category of the NASS Census as a
baseline for determining the acreage
rent.20 Since this method is based on the
same regional NASS Census data that
the Alaska Group questions, and
includes a megawatt capacity fee in
addition to the acreage rent,21 it does
not address the Alaska Group’s
suggestion that a larger, more robust
data set is needed to balance the paucity
of regional agricultural acreage for
Alaska reflected in the NASS Census. In
addition, the acreage rent is determined
using a fee schedule that is divided into
geographic zones, a practice that the
Commission previously rejected.22 For
these reasons, the Commission will not
consider this alternative further.
IV. Regulatory Requirements
A. Information Collection Statement
30. The Paperwork Reduction Act 23
requires each federal agency to seek and
19 See Competitive Processes, Terms, and
Conditions for Leasing Public Lands for Solar and
Wind Energy Development and Technical Changes
and Corrections, 81 FR 92,122, 92,217–18
(December 19, 2016) (to be codified at 43 CFR pts.
2800 and 2880).
20 The acreage rent is calculated by multiplying
the number of acres included in the right-of-way
authorization by a per-acre zone rate from the solar
energy acreage rent schedule. To determine the peracre zone rate, BLM calculates a state-specific
factor, applies the state-specific factor to NASSpublished data, and uses the resulting per-acre
value to assign a particular county or geographic
area to the appropriate rent schedule zone.
21 The Commission previously rejected, as
unreasonable, methods based on power sale
revenues or a rate per kilowatt hour because such
fees would result in a royalty as if the occupied
federal lands themselves were producing power.
Such criticism could also be levied against a
megawatt capacity fee. See Annual Charges for the
Use of Government Lands, FERC Stats. & Regs ¶
32,684; 137 FERC ¶ 61,139, at P 9 (2011) (citing
Revision of the Billing Procedures for Annual
Charges for Administering Part I of the Federal
Power Act and to the Methodology for Assessing
Federal Land Use Charges, Order No. 469, FERC
Stats. & Regs., Regulations Preambles ¶ 30,741, at
30,589–90 (1987)).
22 See Order No. 774 at PP 23–24 (. . . ‘‘the
Commission agreed with commenters that BLM’s
‘zone system’ inflates the values of all counties in
a zone except the highest valued county.’’).
23 44 U.S.C. 3501–3521 (2012).
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Federal Register / Vol. 82, No. 168 / Thursday, August 31, 2017 / Proposed Rules
obtain Office of Management and
Budget (OMB) approval before
undertaking a collection of information
directed to ten or more persons or
contained in a rule of general
applicability. OMB regulations require
approval of certain information
collection requirements contemplated
by proposed rules.24 This proposed rule
does not impose or alter existing
reporting or recordkeeping requirements
on applicable entities as defined by the
Paperwork Reduction Act.25 As a result,
this proposed rule does not trigger the
Paperwork Reduction Act.
B. Environmental Analysis
31. The Commission is required to
prepare an Environmental Assessment
or an Environmental Impact Statement
for any action that may have a
significant effect on the human
environment.26 Commission actions
concerning annual charges are
categorically exempt from this
requirement.27
C. Regulatory Flexibility Act
32. The Regulatory Flexibility Act of
1980 (RFA) 28 generally requires a
description and analysis of proposed
rules that will have significant
economic impact on a substantial
number of small entities. The RFA
mandates consideration of regulatory
alternatives that accomplish the stated
objectives of a proposed rule and
minimize any significant economic
impact on a substantial number of small
entities.29
33. The Small Business
Administration’s (SBA) Office of Size
Standards develops the numerical
definition of a small business.30 The
SBA revised its size standard for electric
utilities (effective January 22, 2014)
from a standard based on megawatt
hours to a standard based on the
number of employees, including
affiliates.31 Under SBA’s current size
standards, a hydroelectric generator is
small if, including its affiliates, it
employs 500 or fewer people.32
34. Section 10(e)(1) of the FPA
requires that the Commission fix a
reasonable annual charge for the use,
occupancy, and enjoyment of federal
24 See
5 CFR 1320.11 (2017).
U.S.C. 3502(2)–(3) (2012).
26 Regulations Implementing the National
Environmental Policy Act of 1969, Order No. 486,
FERC Stats. & Regs. ¶ 30,783 (1987).
27 18 CFR 380.4 (a)(11) (2017).
28 5 U.S.C. 601–612.
29 5 U.S.C. 603(c) (2012).
30 13 CFR 121.101 (2017).
31 SBA Final Rule on ‘‘Small Business Size
Standards: Utilities,’’ 78 FR 77,343 (Dec. 23, 2013).
32 13 CFR 121.201, Sector 22, Utilities (2017).
nlaroche on DSKBBV9HB2PROD with PROPOSALS
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lands by hydropower licensees. To date,
the Commission has issued 21 active
licenses that occupy federal lands in
Alaska to 15 discrete entities. Therefore,
the proposed rule will apply to a total
of 15 entities. Of these 15 entities, 13
entities would be impacted by the
proposed rule because they hold
licenses that occupy federal lands in the
Kenai Peninsula, Fairbanks, Juneau, or
Anchorage Areas. The proposed rule
adopts the use of a statewide average
per-acre land value, rather than a
regional per-acre land value, for the
purpose of calculating annual charges
for the use of federal lands in Alaska.
The Commission will apply the
statewide average per-acre land value to
all hydropower projects in Alaska,
except for projects located in the
Aleutian Islands Area. The Commission
will continue to apply the regional peracre land value for the Aleutian Islands
Area.
35. Based on a review of the 13
licensees that would be impacted by the
proposed rule, we estimate that most, if
not all, are small entities under the SBA
definition. These 13 licensees include
utilities, non-for-profit electric
cooperatives, cities, and companies.
36. Any impact on these small entities
would not be significant. Under the
proposed rule, a statewide average peracre land value for hydropower lands in
Alaska would be calculated based on a
larger agricultural data set, resulting in
land values that will be less prone to
future fluctuation caused by changes in
census data reporting. For Fiscal Year
(FY) 2017, the use of a statewide average
per-acre land value would result in a
lower per-acre fee than that assessed in
FY 2016. Accordingly, the 13 affected
licensees would pay lower annual
charge assessments for use of federal
lands in FY 2017 than they did the
previous fiscal year. Furthermore, six of
the 13 affected licensees are members of
the Alaska Group, which petitioned the
Commission to revise its methodology
for calculating annual charges for use of
federal lands by establishing a statewide
average per-acre land value for Alaska.
Consequently, the proposed rule should
not impose a significant economic
impact on small entities.
37. Accordingly, pursuant to section
605(b) of the RFA, the Commission
certifies that this proposed rule will not
have a significant economic impact on
a substantial number of small entities.
D. Comment Procedures
38. The Commission invites interested
persons to submit comments on the
matters and issues proposed in this
notice to be adopted, including any
related matters or alternative proposals
PO 00000
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41363
that commenters may wish to discuss.
Comments are due October 30, 2017.
Comments must refer to Docket No.
RM16–19–000, and must include the
commenter’s name, the organization
they represent, if applicable, and their
address.
39. The Commission encourages
comments to be filed electronically via
the eFiling link on the Commission’s
Web site at https://www.ferc.gov. The
Commission accepts most standard
word processing formats. Documents
created electronically using word
processing software should be filed in
native applications or print-to-PDF
format and not in a scanned format.
Commenters filing electronically do not
need to make a paper filing.
40. Commenters that are not able to
file comments electronically must send
an original of their comments to:
Federal Energy Regulatory Commission,
Secretary of the Commission, 888 First
Street NE., Washington, DC 20426.
41. All comments will be placed in
the Commission’s public files and may
be viewed, printed, or downloaded
remotely as described in the Document
Availability section below. Commenters
on this proposal are not required to
serve copies of their comments on other
commenters.
E. Document Availability
42. In addition to publishing the full
text of this document in the Federal
Register, the Commission provides all
interested persons an opportunity to
view and print the contents of this
document via the Internet through the
Commission’s Home Page (https://
www.ferc.gov) and in the Commission’s
Public Reference Room during normal
business hours (8:30 a.m. to 5:00 p.m.
Eastern time) at 888 First Street NE.,
Room 2A, Washington, DC 20426.
43. From the Commission’s Home
Page on the Internet, this information is
available on eLibrary. The full text of
this document is available on eLibrary
in PDF and Microsoft Word format for
viewing, printing, and/or downloading.
To access this document in eLibrary,
type the docket number excluding the
last three digits of this document in the
docket number field.
44. User assistance is available for
eLibrary and the Commission’s Web site
during normal business hours from the
Commission’s Online Support at 202–
502–6652 (toll free at 1–866–208–3676)
or email at ferconlinesupport@ferc.gov,
or the Public Reference Room at (202)
502–8371, TTY (202) 502–8659. Email
the Public Reference Room at
public.referenceroom@ferc.gov.
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Federal Register / Vol. 82, No. 168 / Thursday, August 31, 2017 / Proposed Rules
List of Subjects in 18 CFR Part 11
Dams, Electric power, Indians-lands,
Public lands, Reporting and
recordkeeping requirements.
By direction of the Commission.
Issued: August 17, 2017.
Nathaniel J. Davis, Sr.,
Deputy Secretary.
In consideration of the foregoing, the
Federal Energy Regulatory Commission
proposes to amend Part 11, Chapter I,
Title 18, Code of Federal Regulations, as
follows:
PART 11—ANNUAL CHARGES UNDER
PART I OF THE FEDERAL POWER ACT
1. The authority citation for part 11
continues to read as follows:
■
Authority: 16 U.S.C. 792–828c; 42 U.S.C.
7101–7352.
2. In § 11.2, add paragraph (c)(1)(iv) to
read as follows:
*
*
*
*
*
(c) * * *
(1) * * *
(iv) For all geographic areas in Alaska
except for the Aleutian Islands Area, the
Commission will calculate a statewide
average per-acre land value based on the
average per-acre land and building
values published in the NASS Census
for the Kenai Peninsula and the
Fairbanks Areas. This statewide average
per-acre value will be reduced by the
sum of the state-specific modifier and
seven percent. The resulting adjusted
statewide average per-acre value will be
applied to all projects located in Alaska,
except for those projects located in the
Aleutian Island Area.
*
*
*
*
*
■
[FR Doc. 2017–17846 Filed 8–30–17; 8:45 am]
BILLING CODE 6717–01–P
DEPARTMENT OF HEALTH AND
HUMAN SERVICES
Food and Drug Administration
21 CFR Part 117
[Docket No. FDA–2016–D–2343]
nlaroche on DSKBBV9HB2PROD with PROPOSALS
Hazard Analysis and Risk-Based
Preventive Controls for Human Food:
Guidance for Industry; Availability
AGENCY:
Food and Drug Administration,
HHS.
ACTION:
Notification of availability.
The Food and Drug
Administration (FDA, we, or Agency) is
announcing the availability of another
draft chapter of a multichapter guidance
for industry entitled ‘‘Hazard Analysis
SUMMARY:
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15:12 Aug 30, 2017
Jkt 241001
and Risk-Based Preventive Controls for
Human Food: Guidance for Industry.’’
This multichapter draft guidance is
intended to explain our current thinking
on how to comply with the
requirements for hazard analysis and
risk-based preventive controls under our
rule entitled ‘‘Current Good
Manufacturing Practice, Hazard
Analysis, and Risk-Based Preventive
Controls for Human Food.’’ The newly
available draft chapter is entitled
‘‘Chapter Six—Use of Heat Treatments
as a Process Control.’’
DATES: Although you can comment on
any guidance at any time (see 21 CFR
10.115(g)(5)), to ensure that we consider
your comment on this draft guidance
before we issue the final version of the
guidance, submit either electronic or
written comments by February 27, 2018.
You may submit comments as
follows:
Electronic Submissions
Submit electronic comments in the
following way:
• Federal eRulemaking Portal:
https://www.regulations.gov. Follow the
instructions for submitting comments.
Comments submitted electronically,
including attachments, to https://
www.regulations.gov will be posted to
the docket unchanged. Because your
comment will be made public, you are
solely responsible for ensuring that your
comment does not include any
confidential information that you or a
third party may not wish to be posted,
such as medical information, your or
anyone else’s Social Security number, or
confidential business information, such
as a manufacturing process. Please note
that if you include your name, contact
information, or other information that
identifies you in the body of your
comments, that information will be
posted on https://www.regulations.gov.
• If you want to submit a comment
with confidential information that you
do not wish to be made available to the
public, submit the comment as a
written/paper submission and in the
manner detailed (see ‘‘Written/Paper
Submissions’’ and ‘‘Instructions’’).
Written/Paper Submissions
Submit written/paper submissions as
follows:
• Mail/Hand delivery/Courier (for
written/paper submissions): Dockets
Management Staff (HFA–305), Food and
Drug Administration, 5630 Fishers
Lane, Rm. 1061, Rockville, MD 20852.
• For written/paper comments
submitted to the Dockets Management
Staff, FDA will post your comment, as
well as any attachments, except for
information submitted, marked and
PO 00000
Frm 00006
Fmt 4702
Sfmt 4702
identified, as confidential, if submitted
as detailed in ‘‘Instructions.’’
Instructions: All submissions received
must include the Docket No. FDA–
2016–D–2343 for ‘‘Hazard Analysis and
Risk-Based Preventive Controls for
Human Food: Guidance for Industry.’’
Received comments will be placed in
the docket and, except for those
submitted as ‘‘Confidential
Submissions,’’ publicly viewable at
https://www.regulations.gov or at the
Dockets Management Staff office
between 9 a.m. and 4 p.m., Monday
through Friday.
• Confidential Submissions—To
submit a comment with confidential
information that you do not wish to be
made publicly available, submit your
comments only as a written/paper
submission. You should submit two
copies total. One copy will include the
information you claim to be confidential
with a heading or cover note that states
‘‘THIS DOCUMENT CONTAINS
CONFIDENTIAL INFORMATION.’’ The
Agency will review this copy, including
the claimed confidential information, in
its consideration of comments. The
second copy, which will have the
claimed confidential information
redacted/blacked out, will be available
for public viewing and posted on
https://www.regulations.gov. Submit
both copies to the Dockets Management
Staff. If you do not wish your name and
contact information to be made publicly
available, you can provide this
information on the cover sheet and not
in the body of your comments and you
must identify this information as
‘‘confidential.’’ Any information marked
as ‘‘confidential’’ will not be disclosed
except in accordance with 21 CFR 10.20
and other applicable disclosure law. For
more information about FDA’s posting
of comments to public dockets, see 80
FR 56469, September 18, 2015, or access
the information at: https://www.gpo.gov/
fdsys/pkg/FR-2015-09-18/pdf/201523389.pdf.
Docket: For access to the docket to
read background documents or the
electronic and written/paper comments
received, go to https://
www.regulations.gov and insert the
docket number, found in brackets in the
heading of this document, into the
‘‘Search’’ box and follow the prompts
and/or go to the Dockets Management
Staff, 5630 Fishers Lane, Rm. 1061,
Rockville, MD 20852.
Submit written requests for single
copies of the draft guidance to Office of
Food Safety, Center for Food Safety and
Applied Nutrition, Food and Drug
Administration (HFS–300), 5001
Campus Dr., College Park, MD 20740.
Send two self-addressed adhesive labels
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]]>Agencies
[Federal Register Volume 82, Number 168 (Thursday, August 31, 2017)]
[Proposed Rules]
[Pages 41359-41364]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2017-17846]
========================================================================
Proposed Rules
Federal Register
________________________________________________________________________
This section of the FEDERAL REGISTER contains notices to the public of
the proposed issuance of rules and regulations. The purpose of these
notices is to give interested persons an opportunity to participate in
the rule making prior to the adoption of the final rules.
========================================================================
Federal Register / Vol. 82 , No. 168 / Thursday, August 31, 2017 /
Proposed Rules
[[Page 41359]]
DEPARTMENT OF ENERGY
Federal Energy Regulatory Commission
18 CFR Part 11
[Docket No. RM16-19-000]
Annual Charges for Use of Government Lands in Alaska
AGENCY: Federal Energy Regulatory Commission, Department of Energy.
ACTION: Notice of proposed rulemaking.
-----------------------------------------------------------------------
SUMMARY: The Federal Power Act requires hydropower licensees to
recompense the United States for the use, occupancy, and enjoyment of
federal lands. The Commission assesses annual charges for the use of
federal lands through Part 11 of its regulations. The Commission
proposes to revise the per-acre land value component of its methodology
for calculating these annual charges for hydropower projects located in
Alaska. Under the proposed rule, the Commission would calculate a
statewide average per-acre land value for hydropower lands in Alaska.
The Commission would use the statewide average per-acre land value,
rather than a regional per-acre land value, to calculate annual charges
for use of federal lands for all hydropower projects in Alaska, except
those located in the Aleutian Islands Area.
DATES: Comments are due October 30, 2017.
ADDRESSES: Comments, identified by docket number, may be filed in the
following ways:
Electronic Filing through https://www.ferc.gov. Documents
created electronically using word processing software should be filed
in native applications or print-to-PDF format and not in a scanned
format.
Mail/Hand Delivery: Those unable to file electronically
may mail or hand-deliver comments to: Federal Energy Regulatory
Commission, Secretary of the Commission, 888 First Street NE.,
Washington, DC 20426.
Instructions: For detailed instructions on submitting comments and
additional information on the rulemaking process, see the Comment
Procedures section of this document
FOR FURTHER INFORMATION CONTACT:
Tara DiJohn (Legal Information), Office of the General Counsel, Federal
Energy Regulatory Commission, 888 First Street NE., Washington, DC
20426, (202) 502-8671, tara.dijohn@ferc.gov.
Norman Richardson (Technical Information), Office of the Executive
Director, Federal Energy Regulatory Commission, 888 First Street NE.,
Washington, DC 20426, (202) 502-6219, norman.richardson@ferc.gov.
SUPPLEMENTARY INFORMATION:
Table of Contents
Paragraph Nos.
I. Background........................................... 2.
A. Order No. 774.................................... 4.
1. Per-Acre Land Value.......................... 6.
2. Per-Acre Land Values for Alaska.............. 8.
B. Fiscal Year 2016 Fee Schedule.................... 10.
C. Petition for Rulemaking.......................... 11.
II. Notice of Inquiry................................... 14.
III. Proposed Rule...................................... 24.
IV. Regulatory Requirements............................. 30.
A. Information Collection Statement................. 30.
B. Environmental Analysis........................... 31.
C. Regulatory Flexibility Act....................... 32.
D. Comment Procedures............................... 38.
E. Document Availability............................ 42.
1. The Federal Power Act (FPA) requires hydropower licensees that
use federal lands to compensate the United States for the use,
occupancy, and enjoyment of federal lands.\1\ Currently, the Commission
uses a fee schedule, based on the U.S. Bureau of Land Management's
(BLM) methodology for calculating rental rates for linear rights of
way, to calculate annual charges for use of federal lands. The
Commission's fee schedule identifies a fee for each county or
geographic area, which is the product of four components: A per-acre
land value, an encumbrance factor, a rate of return, and an annual
adjustment factor. The per-acre land value for a particular county or
geographic area (i.e., a regional per-acre land value) is determined
using the average per-acre land value identified by the National
Agricultural Statistics Service (NASS) Census. Under the proposed rule,
the Commission would use a statewide average per-acre land value for
the state of Alaska, rather than a regional per-acre land value.
---------------------------------------------------------------------------
\1\ 16 U.S.C. 803(e)(1) (2012).
---------------------------------------------------------------------------
I. Background
2. Section 10(e)(1) of the FPA requires Commission hydropower
licensees using federal lands to pay reasonable annual charges, as
determined by the Commission, to recompense the United States for the
use and occupancy of its lands.\2\ While the Commission may
periodically adjust these charges, it must seek to avoid increasing the
price
[[Page 41360]]
to power consumers by such charges.\3\ In other words, licensees that
use and occupy federal lands for project purposes must compensate the
United States through payment of an annual fee, to be established by
the Commission.\4\
---------------------------------------------------------------------------
\2\ 16 U.S.C. 803(e)(1) (2012). Section 10(e)(1) also requires
licensees to reimburse the United States for the costs of
administering Part I of the FPA. Those charges are calculated and
billed separately from the land use charges, and are not the subject
of this proposed rule.
\3\ Id.
\4\ Pursuant to FPA section 17(a), 16 U.S.C. 810(a) (2012), the
fees collected for use of government lands are allocated as follows:
12.5 percent is paid into the Treasury of the United States, 50
percent is paid into the federal reclamation fund, and 37.5 percent
is paid into the treasuries of the states in which particular
projects are located. No part of the fees discussed in this proposed
rule is used to fund the Commission's operations.
---------------------------------------------------------------------------
3. The Commission has adopted various methods over the years to
accomplish this statutory directive.\5\ Currently, the Commission uses
a fee schedule method, based on land values published in the NASS
Census, to calculate annual charges for use of government lands. The
Commission adopted this approach in a final rule issued on January 12,
2013.\6\
---------------------------------------------------------------------------
\5\ See Annual Charges for Use of Government Lands, Order No.
774, FERC Stats. & Regs. ] 31,341, at PP 3-20 (2013) (cross-
referenced at 142 FERC ] 61,045) (examining the myriad methodologies
the Commission has used or considered for assessing annual charges
for the use of government lands since 1937) (Order No. 774).
\6\ See generally, Order No. 774.
---------------------------------------------------------------------------
A. Order No. 774
4. In Order No. 774, the Commission adopted a fee schedule method
for calculating annual charges for use of government lands, based on
BLM's methodology for calculating rental rates for linear rights of
way. Pursuant to section 11.2 of the Commission's regulations, the
Commission publishes an annual fee schedule which lists per-acre rental
fees by county or geographic area.\7\ To calculate a licensee's annual
charge for use of government lands, the Commission multiplies the
applicable county or geographic area per-acre fee identified in the fee
schedule by the number of federal acres used by the hydroelectric
project, as reported by that licensee.
---------------------------------------------------------------------------
\7\ 18 CFR 11.2 (2017). The fee schedule is published annually
as part of Appendix A to Part 11 of the Commission's regulations.
---------------------------------------------------------------------------
5. The per-acre rental fee for a particular county or geographic
area is calculated by multiplying four components: (1) A per-acre land
value; (2) an encumbrance factor; (3) a rate of return; and (4) an
annual adjustment factor.
1. Per-Acre Land Value
6. The first component--the per-acre land value--is based on
average per-acre land values published in the NASS Census.
Specifically, the per-acre land value is determined by the applicable
county or geographic area ``land and buildings'' category \8\ from the
NASS Census. This NASS-published per-acre value is then reduced by the
sum of a state-specific modifier (to remove the value of irrigated
lands) and seven percent (to remove the value of buildings or other
improvements). The end result is the adjusted per-acre land value.
---------------------------------------------------------------------------
\8\ The ``land and buildings'' is a combination of all land use
categories in the NASS Census, including croplands (irrigated and
non-irrigated), pastureland/rangeland, woodland, and ``other''
(roads, ponds, wasteland, and land encumbered by non-commercial/non-
residential buildings).
---------------------------------------------------------------------------
7. The NASS Census is conducted every five years, with an 18-month
delay before NASS publishes the census data. The Commission
incorporates another 18-month delay to account for revisions,
consistent with BLM's implementation of its 2008 rule. Therefore, the
Commission based the 2011-2015 fee schedules on data from the 2007 NASS
Census. The Commission's 2016-2020 fee schedules will be based on data
from the 2012 NASS Census; the 2021-2025 fee schedules will be based on
data from the 2017 NASS Census; the 2026-2030 fee schedules will be
based on data from the 2022 NASS Census; and so on. State-specific
adjustments to the per-acre land value are performed in the first year
that data from a new NASS Census are used, and will remain the same
until the subsequent NASS Census data are used to calculate the
forthcoming set of fee schedules.
2. Per-Acre Land Values for Alaska
8. With regard to Alaska, Order No. 774 explained that the final
rule would adopt BLM's approach to per-acre land values by designating
lands in Alaska as part of one of the five NASS Census geographic area
identifiers: The Aleutian Islands Area, the Anchorage Area, the
Fairbanks Area, the Juneau Area, and the Kenai Peninsula Area. Several
commenters asserted that a per-acre statewide value, a category also
reported by the NASS Census, should be used to establish assessments
for federal land in Alaska.\9\
---------------------------------------------------------------------------
\9\ Order No. 774 at P 44.
---------------------------------------------------------------------------
9. Order No. 774 considered the arguments raised in support of a
statewide per-acre value. In particular, several commenters asserted
that it is inappropriate to use regional per-acre values for Alaska
because Alaska does not use county designations; the number of farms
surveyed for the NASS Census in the entire state of Alaska is less than
the number of farms surveyed in most counties in the lower-48 states;
and, certain per-acre land values near Anchorage and Juneau are very
high, resulting in a substantial increase in annual charges for the use
of government lands by hydropower licensees in these areas. However,
the Commission ultimately concluded that the commenters had not
advanced a sufficient explanation for why it was more appropriate to
use a statewide per-acre value for Alaska, rather than the smallest
NASS Census defined area for Alaska--the geographic area identifier.
Although the Commission rejected the use of a statewide per-acre land
value for Alaska in Order No. 774, the Commission clarified that it
would not use rates based on the Anchorage Area and the Juneau Area
values to assess annual land use charges ``because these high, urban-
based rates would not reasonably reflect the value of government lands
on which hydropower projects are located.'' \10\ Instead, for purposes
of determining a per-acre land value, the Commission decided to use the
Kenai Peninsula Area per-acre land value for projects located in the
Anchorage Area or the Juneau Area.
---------------------------------------------------------------------------
\10\ Id. at P 45.
---------------------------------------------------------------------------
B. Fiscal Year 2016 Fee Schedule
10. The Commission used the 2012 NASS Census data to calculate its
fee schedule for the first time in Fiscal Year (FY) 2016. Due to per-
acre land value increases in the 2012 NASS Census data, hydropower
projects located in certain geographic areas in Alaska experienced a
significant increase in federal land use charges when compared to the
rates assessed in FY 2015.\11\
---------------------------------------------------------------------------
\11\ In the 2012 NASS Census, changes in land values in other
parts of the country varied widely: Some rose significantly, some
rose by relatively small amounts, and some decreased.
---------------------------------------------------------------------------
C. Petition for Rulemaking
11. On June 6, 2016, the Alaska Federal Land Fees Group, comprising
six hydroelectric licensees with projects in Alaska (Alaska Group),\12\
petitioned the Commission to conduct a rulemaking to revise its method
of calculating federal land use charges for hydropower projects in
Alaska. The Alaska Group's petition focuses solely on the first
component of the Commission's fee schedule--the per-acre land value--
and requests that the Commission: (1) Calculate an adjusted statewide
average per-acre land value for Alaska and (2) apply this adjusted
[[Page 41361]]
statewide average per-acre fee to all projects in Alaska, except those
located in the Aleutian Islands area.\13\
---------------------------------------------------------------------------
\12\ Alaska Electric Light and Power, Bradley Lake Project
Management Committee (on behalf of licensee Alaska Energy
Authority), Chugach Electric Association, the Ketchikan Public
Utilities, Copper Valley Electric Association, and Southeast Alaska
Power Agency.
\13\ The Alaska Group requests that any project located in the
Aleutian Islands Area continue to be assessed annual charges for use
of government lands based on a regional per-acre land value.
---------------------------------------------------------------------------
12. In support of this proposal, the Alaska Group states that due
to the small number of farms (and associated acreage) that contribute
to the data compiled in the NASS Census, there is insufficient data in
any individual Alaska area (with the exception of the Aleutian Islands)
\14\ to produce a fair estimate of land values within that area.
Because there are so few farms outside of the Aleutian Islands area,
the Alaska Group indicates that the per-acre land values in the other
four geographic areas of Alaska are extremely sensitive to any changes
in the voluntary, self-reported farm data compiled by the NASS Census.
---------------------------------------------------------------------------
\14\ The Alaska Group contends that because the Aleutian Islands
Area contains the greatest amount of farmland in the state (668,016
acres), the NASS Census data for the Aleutian Islands Area is
``robust, reliable, and an accurate estimate of fair market value.''
Alaska Group's June 6, 2016 Petition for Rulemaking at 18.
Therefore, the Alaska Group requests that the proposed statewide
average per-acre land value be applied to all hydropower projects
located in Alaska, except those projects located in the Aleutian
Islands Area.
---------------------------------------------------------------------------
13. For these reasons, the Alaska Group asserts that an adjusted
statewide average per-acre land value would better reflect the diverse
topography of the state and insulate against land value fluctuations
caused by individual changes in farm data. The Alaska Group believes
that this method would produce a more accurate estimate of the fair
market value of federal lands in Alaska.
II. Notice of Inquiry
14. On November 17, 2016, the Commission issued a Notice of Inquiry
soliciting input on a narrow question related to its current
methodology for calculating annual charges for the use of government
lands--whether regional per-acre land values based on data published in
the NASS Census ``land and buildings'' category result in reasonably
accurate land valuations for projects that occupy federal lands in
Alaska. In response to the proposal advanced by the Alaska Group's
petition for rulemaking, the Notice of Inquiry requested comments on
several specific questions. First, the Commission asked whether it
should use a statewide average per-acre land value rather than a
regional per-acre land value to calculate the adjusted per-acre land
value for projects that occupy federal lands in Alaska. Second, if a
statewide average per-acre value is preferred, the Commission sought
input on whether the statewide value should be applied to (i) all
projects in Alaska, or (ii) all projects in Alaska except those located
in the Aleutian Islands Area. Finally, the Commission requested
commenters to identify which of the five geographic regions of Alaska
it should use to calculate the statewide average per-acre land value.
15. In addition, the Notice of Inquiry encouraged commenters to
submit alternative proposals for determining a reasonably accurate per-
acre land value for projects in Alaska, provided that the proposed
calculation was based on data published in the NASS Census. The notice
also invited federal land management agencies to comment on how they
would view reductions in annual charges for the lands they administer.
16. The Notice of Inquiry identified five requirements that any
proposed methodology should satisfy, derived from the Commission's
statutory obligations under the FPA \15\ and the Commission's past
experience in implementing various methodologies. Any proposed
methodology must: (1) Apply uniformly to all licensees in Alaska; (2)
avoid exorbitant administrative costs; (3) not be subject to review on
an individual basis; (4) reflect reasonably accurate land valuations;
and (5) avoid an unreasonable increase in costs to consumers.
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\15\ See 16 U.S.C. 803(e)(1) (2012).
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17. In response to the Notice of Inquiry, seven entities filed
comments: The Alaska Group; U.S. Senator Lisa Murkowski; Homer Electric
Association, Inc. (Homer Electric); Kodiak Electric Association, Inc.
(Kodiak Electric); the U.S. Forest Service (Forest Service); Erin
Noakes; and Chelsea Liddell.
18. The Alaska Group filed comments reiterating its position that
the Commission should adopt a statewide average per-acre land value for
all hydropower projects in Alaska, and that the statewide average
should be applied to all projects in Alaska, except those located in
the Aleutian Islands Area. The Alaska Group states that it does not
believe that the Commission needs to change its methodology for
calculating annual charges for the Aleutian Islands Area since the
substantial amount of agricultural acreage represented in the NASS
Census data results in a fair estimate of land values for this
particular region.
19. In support of its position, the Alaska Group states that the
use of a statewide average per-acre land value would provide ``a more
robust and representative assessment of fair market value of federal
lands in [the Kenai and Fairbanks] areas of Alaska, because it draws on
a larger and more diverse dataset from across the state, and ensures
that rates are less prone to fluctuation over time.'' \16\ According to
the Alaska Group, if the Commission were to adopt a statewide average
per-acre land value for Alaska, it would recognize several unique
burdens faced by Alaska hydropower licensees and ratepayers, including
the exclusive responsibility borne by Alaska ratepayers for all costs
associated with hydropower projects, including annual charge
assessments and the predominance of federal acreage in Alaska.
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\16\ The Alaska Group's January 24, 2017 Comments on Notice of
Inquiry at 16-17.
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20. Senator Murkowski urges the Commission to use a statewide
average per-acre land value, stating that the NASS Census data does not
provide an accurate accounting of land values in Alaska because the
state has fewer farms and farm acreage than any other state in the
Pacific Northwest. Homer Electric, an electric distribution cooperative
that provides service in the Kenai Peninsula, agrees with Senator
Murkowski's comments that the NASS Census data does not provide an
accurate accounting of Alaskan land values. Homer Electric also urges
the Commission to adopt a statewide average per-acre land value for
Alaska.
21. Kodiak Electric, a licensee of a hydropower project located in
the Aleutian Islands Area, states that the regional per-acre land
values published in the NASS Census result in reasonably accurate land
valuations for hydropower lands in the Aleutian Islands Area. Because
of the large number of agricultural acreage reported by the NASS Census
for the Aleutian Islands Area, Kodiak Electric believes no changes to
the Commission's current methodology are needed for this geographic
region. If the Commission decides to adopt a statewide average per-acre
land value for hydropower projects in Alaska, Kodiak Electric
recommends that the Commission refrain from applying the statewide
value to projects located in the Aleutian Islands Area.
22. The Forest Service observes that from an economic perspective
the use of a statewide average per-acre land value for Alaska, derived
from data published in the NASS Census, would result in a significant
reduction in rental rates for the land in question. However, the Forest
Service states that it does not recommend the use of a fee schedule
[[Page 41362]]
based on NASS Census data for Alaska because of the small number of
farms in the state. Instead, the Forest Service recommends that the
Commission calculate federal land charges for Alaska using BLM's
``Minimum Rent Schedule for BLM Land Use Authorizations in Alaska
2015.'' The Forest Service also suggests that the Commission consider a
fee based on power generated, similar to BLM's solar fee schedule.
23. Erin Noakes and Chelsea Liddell each filed individual comments
recommending that the Commission decline the request to alter its
current methodology for calculating federal land charges for hydropower
projects in Alaska. Ms. Noakes observes that the use of a statewide
average per-acre land value may result in the under-collection of
reasonable annual charges for the use of federal lands by hydropower
projects in Alaska. Ms. Liddell asserts that the Alaska Group has not
sufficiently demonstrated that a statewide average per-acre land value
would be any more accurate than a regional per-acre land value.
III. Proposed Rule
24. The Commission proposes to adopt the use of a statewide average
per-acre land value, rather than a regional per-acre land value, for
the purposes of calculating annual charges for hydropower projects that
occupy federal lands in Alaska.
25. To calculate the statewide average per-acre land value for
Alaska, the Commission will average the data published in the ``lands
and buildings'' category of the NASS Census for two geographic areas:
the Kenai Peninsula Area and the Fairbanks Area.\17\ Pursuant to the
Commission's current methodology, this statewide average will be
reduced by Alaska's state-specific reduction to remove the value of
irrigated lands, as well as a seven percent reduction to remove the
value of buildings. The Commission will apply the resulting adjusted
statewide average per-acre land value to all hydropower projects in
Alaska except for projects located in the Aleutian Islands Area.
Because of the large amount of farmland acreage represented in the NASS
Census for the Aleutian Islands Area, the Commission is satisfied that
the NASS Census data for this geographic area results in reasonably
accurate per-acre land values. Therefore, the Commission will continue
to apply the regional per-acre land value for the Aleutian Islands
Area.
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\17\ As we noted earlier, the Commission does not use the NASS
Census data from the Anchorage Area or the Juneau Area for the
purpose of determining per-acre land values because the
predominantly high, urban-based rates do not reasonably reflect the
value of government lands on which hydropower projects are located.
See supra P 9.
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26. We believe this proposal responds to the issues identified by
the petitioners--the prevalence of federal lands in Alaska, the sparse
amount of agricultural acreage reflected in the NASS Census, and the
increase in annual charges that resulted when the Commission began
using data from the 2012 NASS Census. Combining the value of the
farmland acreage in the Kenai Peninsula and Fairbanks Areas to
calculate a statewide average land value will result in a larger, more
robust data set. A larger data set will be less prone to future
fluctuation due to changes in the level of participation in NASS Census
data reporting or specific anomalies in the data reported. We are
satisfied that a statewide average per-acre land value based on the
NASS Census data from the ``land and buildings'' category for the Kenai
Peninsula and Fairbanks Areas will result in reasonably accurate land
values for hydropower projects that occupy federal lands in Alaska.
27. While the Commission is proposing to implement a statewide
average per-acre land value to address these concerns, we are not
persuaded that the Aleutian Islands Area values, which are lower than
land values elsewhere in the state, should be used in calculating a
statewide average that is applied to hydropower projects located
outside of the Aleutian Islands Area.
28. The Forest Service recommends that the Commission employ a
method based on the 2015 Minimum Rent Schedule for BLM Land Use
Authorizations in Alaska.\18\ Following an analysis of this
alternative, Commission staff concluded that the use of BLM's Minimum
Rent Schedule would result in higher per-acre fees compared to the
Commission's current methodology. BLM's Minimum Rent Schedule for
Alaska uses land values based on rural sales data. The underlying land
values for the Kenai Peninsula, Fairbanks, and Aleutian Islands Areas
are all higher than the corresponding land values published in the NASS
Census. The Commission does not believe that there is sufficient
justification for using--only for Alaska--BLM's Minimum Rent Schedule,
instead of continuing to use NASS Census data to establish federal land
use charges for all areas of the country.
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\18\ See generally BLM, Rent for Remote Non-Linear Rights-of-
Way, Permits and Leases, https://www.blm.gov/policy/im-ak-2015-010
(instruction memorandum describing the U.S. Department of the
Interior--Office of Valuation Services' April 2015 Minimum Rent
Analysis & Schedule, which provides guidance and a rental schedule
for land use authorizations of up to 25 acres across each of BLM's
district and field offices in Alaska).
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29. In addition, the Forest Service suggests that the Commission
consider a fee based on power generated, similar to the solar fee
schedule. For solar energy right-of-way authorizations, BLM charges a
combined rent and fee consisting of an acreage rent paid annually
regardless of the stage of development, and a megawatt capacity fee
paid annually once electricity generation begins.\19\ BLM uses per-acre
data from the ``land and buildings'' category of the NASS Census as a
baseline for determining the acreage rent.\20\ Since this method is
based on the same regional NASS Census data that the Alaska Group
questions, and includes a megawatt capacity fee in addition to the
acreage rent,\21\ it does not address the Alaska Group's suggestion
that a larger, more robust data set is needed to balance the paucity of
regional agricultural acreage for Alaska reflected in the NASS Census.
In addition, the acreage rent is determined using a fee schedule that
is divided into geographic zones, a practice that the Commission
previously rejected.\22\ For these reasons, the Commission will not
consider this alternative further.
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\19\ See Competitive Processes, Terms, and Conditions for
Leasing Public Lands for Solar and Wind Energy Development and
Technical Changes and Corrections, 81 FR 92,122, 92,217-18 (December
19, 2016) (to be codified at 43 CFR pts. 2800 and 2880).
\20\ The acreage rent is calculated by multiplying the number of
acres included in the right-of-way authorization by a per-acre zone
rate from the solar energy acreage rent schedule. To determine the
per-acre zone rate, BLM calculates a state-specific factor, applies
the state-specific factor to NASS-published data, and uses the
resulting per-acre value to assign a particular county or geographic
area to the appropriate rent schedule zone.
\21\ The Commission previously rejected, as unreasonable,
methods based on power sale revenues or a rate per kilowatt hour
because such fees would result in a royalty as if the occupied
federal lands themselves were producing power. Such criticism could
also be levied against a megawatt capacity fee. See Annual Charges
for the Use of Government Lands, FERC Stats. & Regs ] 32,684; 137
FERC ] 61,139, at P 9 (2011) (citing Revision of the Billing
Procedures for Annual Charges for Administering Part I of the
Federal Power Act and to the Methodology for Assessing Federal Land
Use Charges, Order No. 469, FERC Stats. & Regs., Regulations
Preambles ] 30,741, at 30,589-90 (1987)).
\22\ See Order No. 774 at PP 23-24 (. . . ``the Commission
agreed with commenters that BLM's `zone system' inflates the values
of all counties in a zone except the highest valued county.'').
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IV. Regulatory Requirements
A. Information Collection Statement
30. The Paperwork Reduction Act \23\ requires each federal agency
to seek and
[[Page 41363]]
obtain Office of Management and Budget (OMB) approval before
undertaking a collection of information directed to ten or more persons
or contained in a rule of general applicability. OMB regulations
require approval of certain information collection requirements
contemplated by proposed rules.\24\ This proposed rule does not impose
or alter existing reporting or recordkeeping requirements on applicable
entities as defined by the Paperwork Reduction Act.\25\ As a result,
this proposed rule does not trigger the Paperwork Reduction Act.
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\23\ 44 U.S.C. 3501-3521 (2012).
\24\ See 5 CFR 1320.11 (2017).
\25\ 44 U.S.C. 3502(2)-(3) (2012).
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B. Environmental Analysis
31. The Commission is required to prepare an Environmental
Assessment or an Environmental Impact Statement for any action that may
have a significant effect on the human environment.\26\ Commission
actions concerning annual charges are categorically exempt from this
requirement.\27\
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\26\ Regulations Implementing the National Environmental Policy
Act of 1969, Order No. 486, FERC Stats. & Regs. ] 30,783 (1987).
\27\ 18 CFR 380.4 (a)(11) (2017).
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C. Regulatory Flexibility Act
32. The Regulatory Flexibility Act of 1980 (RFA) \28\ generally
requires a description and analysis of proposed rules that will have
significant economic impact on a substantial number of small entities.
The RFA mandates consideration of regulatory alternatives that
accomplish the stated objectives of a proposed rule and minimize any
significant economic impact on a substantial number of small
entities.\29\
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\28\ 5 U.S.C. 601-612.
\29\ 5 U.S.C. 603(c) (2012).
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33. The Small Business Administration's (SBA) Office of Size
Standards develops the numerical definition of a small business.\30\
The SBA revised its size standard for electric utilities (effective
January 22, 2014) from a standard based on megawatt hours to a standard
based on the number of employees, including affiliates.\31\ Under SBA's
current size standards, a hydroelectric generator is small if,
including its affiliates, it employs 500 or fewer people.\32\
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\30\ 13 CFR 121.101 (2017).
\31\ SBA Final Rule on ``Small Business Size Standards:
Utilities,'' 78 FR 77,343 (Dec. 23, 2013).
\32\ 13 CFR 121.201, Sector 22, Utilities (2017).
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34. Section 10(e)(1) of the FPA requires that the Commission fix a
reasonable annual charge for the use, occupancy, and enjoyment of
federal lands by hydropower licensees. To date, the Commission has
issued 21 active licenses that occupy federal lands in Alaska to 15
discrete entities. Therefore, the proposed rule will apply to a total
of 15 entities. Of these 15 entities, 13 entities would be impacted by
the proposed rule because they hold licenses that occupy federal lands
in the Kenai Peninsula, Fairbanks, Juneau, or Anchorage Areas. The
proposed rule adopts the use of a statewide average per-acre land
value, rather than a regional per-acre land value, for the purpose of
calculating annual charges for the use of federal lands in Alaska. The
Commission will apply the statewide average per-acre land value to all
hydropower projects in Alaska, except for projects located in the
Aleutian Islands Area. The Commission will continue to apply the
regional per-acre land value for the Aleutian Islands Area.
35. Based on a review of the 13 licensees that would be impacted by
the proposed rule, we estimate that most, if not all, are small
entities under the SBA definition. These 13 licensees include
utilities, non-for-profit electric cooperatives, cities, and companies.
36. Any impact on these small entities would not be significant.
Under the proposed rule, a statewide average per-acre land value for
hydropower lands in Alaska would be calculated based on a larger
agricultural data set, resulting in land values that will be less prone
to future fluctuation caused by changes in census data reporting. For
Fiscal Year (FY) 2017, the use of a statewide average per-acre land
value would result in a lower per-acre fee than that assessed in FY
2016. Accordingly, the 13 affected licensees would pay lower annual
charge assessments for use of federal lands in FY 2017 than they did
the previous fiscal year. Furthermore, six of the 13 affected licensees
are members of the Alaska Group, which petitioned the Commission to
revise its methodology for calculating annual charges for use of
federal lands by establishing a statewide average per-acre land value
for Alaska. Consequently, the proposed rule should not impose a
significant economic impact on small entities.
37. Accordingly, pursuant to section 605(b) of the RFA, the
Commission certifies that this proposed rule will not have a
significant economic impact on a substantial number of small entities.
D. Comment Procedures
38. The Commission invites interested persons to submit comments on
the matters and issues proposed in this notice to be adopted, including
any related matters or alternative proposals that commenters may wish
to discuss. Comments are due October 30, 2017. Comments must refer to
Docket No. RM16-19-000, and must include the commenter's name, the
organization they represent, if applicable, and their address.
39. The Commission encourages comments to be filed electronically
via the eFiling link on the Commission's Web site at https://www.ferc.gov. The Commission accepts most standard word processing
formats. Documents created electronically using word processing
software should be filed in native applications or print-to-PDF format
and not in a scanned format. Commenters filing electronically do not
need to make a paper filing.
40. Commenters that are not able to file comments electronically
must send an original of their comments to: Federal Energy Regulatory
Commission, Secretary of the Commission, 888 First Street NE.,
Washington, DC 20426.
41. All comments will be placed in the Commission's public files
and may be viewed, printed, or downloaded remotely as described in the
Document Availability section below. Commenters on this proposal are
not required to serve copies of their comments on other commenters.
E. Document Availability
42. In addition to publishing the full text of this document in the
Federal Register, the Commission provides all interested persons an
opportunity to view and print the contents of this document via the
Internet through the Commission's Home Page (https://www.ferc.gov) and
in the Commission's Public Reference Room during normal business hours
(8:30 a.m. to 5:00 p.m. Eastern time) at 888 First Street NE., Room 2A,
Washington, DC 20426.
43. From the Commission's Home Page on the Internet, this
information is available on eLibrary. The full text of this document is
available on eLibrary in PDF and Microsoft Word format for viewing,
printing, and/or downloading. To access this document in eLibrary, type
the docket number excluding the last three digits of this document in
the docket number field.
44. User assistance is available for eLibrary and the Commission's
Web site during normal business hours from the Commission's Online
Support at 202-502-6652 (toll free at 1-866-208-3676) or email at
ferconlinesupport@ferc.gov, or the Public Reference Room at (202) 502-
8371, TTY (202) 502-8659. Email the Public Reference Room at
public.referenceroom@ferc.gov.
[[Page 41364]]
List of Subjects in 18 CFR Part 11
Dams, Electric power, Indians-lands, Public lands, Reporting and
recordkeeping requirements.
By direction of the Commission.
Issued: August 17, 2017.
Nathaniel J. Davis, Sr.,
Deputy Secretary.
In consideration of the foregoing, the Federal Energy Regulatory
Commission proposes to amend Part 11, Chapter I, Title 18, Code of
Federal Regulations, as follows:
PART 11--ANNUAL CHARGES UNDER PART I OF THE FEDERAL POWER ACT
0
1. The authority citation for part 11 continues to read as follows:
Authority: 16 U.S.C. 792-828c; 42 U.S.C. 7101-7352.
0
2. In Sec. 11.2, add paragraph (c)(1)(iv) to read as follows:
* * * * *
(c) * * *
(1) * * *
(iv) For all geographic areas in Alaska except for the Aleutian
Islands Area, the Commission will calculate a statewide average per-
acre land value based on the average per-acre land and building values
published in the NASS Census for the Kenai Peninsula and the Fairbanks
Areas. This statewide average per-acre value will be reduced by the sum
of the state-specific modifier and seven percent. The resulting
adjusted statewide average per-acre value will be applied to all
projects located in Alaska, except for those projects located in the
Aleutian Island Area.
* * * * *
[FR Doc. 2017-17846 Filed 8-30-17; 8:45 am]
BILLING CODE 6717-01-P
