Cranes and Derricks in Construction: Operator Certification Extension, 51986-51998 [2017-24349]

Agencies

• DEPARTMENT OF LABOR
• Occupational Safety and Health Administration

[Federal Register Volume 82, Number 216 (Thursday, November 9, 2017)]
[Rules and Regulations]
[Pages 51986-51998]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2017-24349]


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DEPARTMENT OF LABOR

Occupational Safety and Health Administration

29 CFR Part 1926

[Docket ID-OSHA-2007-0066]
RIN 1218-AC96


Cranes and Derricks in Construction: Operator Certification 
Extension

AGENCY: Occupational Safety and Health Administration (OSHA), Labor.

ACTION: Final rule.

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SUMMARY: OSHA is delaying its deadline for employers to ensure that 
crane operators are certified by one year until November 10, 2018. OSHA 
is also extending its employer duty to ensure that crane operators are 
competent to operate a crane safely for the same one-year period.

DATES: This final rule is effective on November 9, 2017.

ADDRESSES: In accordance with 28 U.S.C. 2112(a)(2), the Agency 
designates Ann Rosenthal, Associate Solicitor of Labor for Occupational 
Safety and Health, Office of the Solicitor, Room S-4004, U.S. 
Department of Labor, 200 Constitution Avenue NW., Washington, DC 20210, 
to receive petitions for review of the final rule.

FOR FURTHER INFORMATION CONTACT: 
    General information and press inquiries: Mr. Frank Meilinger, OSHA 
Office of Communications: telephone: (202) 693-1999; email: 
Meilinger.Francis2@dol.gov.
    Technical inquiries: Mr. Vernon Preston, Directorate of 
Construction: telephone: (202) 693-2020; fax: (202) 693-1689; email: 
Preston.Vernon@dol.gov.
    Copies of this Federal Register document and news releases: 
Electronic copies of these documents are available at OSHA's Web page 
at https://www.osha.gov.

SUPPLEMENTARY INFORMATION:

I. Background

A. Introduction

    OSHA is publishing this final rule to further extend by one year 
the employer duty to ensure the competency of crane operators involved 
in construction work. Previously this duty was scheduled to terminate 
on November 10, 2017, but now continues until November 10, 2018. OSHA 
also is further delaying the deadline for crane operator certification 
for one year from November 10, 2017, to November 10, 2018. As explained 
in more detail in the following Regulatory Background section, the 
extension and delay are necessary to provide sufficient time for OSHA 
to complete a related rulemaking to address issues with its existing 
Cranes and Derricks in Construction standard (29 CFR part 1926, subpart 
CC, referred to as ``the crane standard'' hereafter) (75 FR 47905).
    In establishing the effective date of this action, the Agency finds 
good cause pursuant to 5 U.S.C. 553(d)(3) of the Administrative 
Procedure Act that this rule be made effective on November 9, 2017, 
rather than delaying the effective date for 30 days after publication. 
The basis for this finding is that it is unnecessary to delay this 
effective date to provide an additional period of time for employers to 
comply with a new requirement because OSHA is extending the status quo. 
This final rule establishes no new burdens on the regulated community; 
rather, it further delays implementation of the crane operator 
certification requirements in the crane standard and further extends 
the employer duty in the crane standard to ensure the competency of 
crane operators, a duty that employers have been required to comply 
with since publication of the crane standard in 2010.

[[Page 51987]]

    OSHA also concludes that delaying the effective date of this 
extension rulemaking beyond November 9, 2017, would be contrary to the 
public interest and would significantly disrupt the construction 
industry. If the extension does not go into effect on November 9, 2017, 
the crane operator certification requirements in the 2010 crane 
standard would go into effect and the employer duty in the crane 
standard to ensure crane operator competency would end. As the Agency 
notes below in Section II.A (Extension of operator certification 
deadline), there is evidence in the record that many crane operators in 
the construction industry do not have the certification required by the 
crane standard and would be out of compliance with the standard. This 
would not be offset through the employer duty to ensure crane operator 
competency because that duty would no longer exist. Therefore, OSHA 
concludes that it is in the public interest to avoid such disruption by 
having this extension go into effect by November 9, 2017. Finally, OSHA 
notes that by delaying the operator certification deadline, OSHA is 
temporarily relieving the regulated community of a compliance duty, 
which under 5 U.S.C. 553(d)(1) is a separate basis for allowing a rule 
to become effective in less than 30 days.
    By delaying the deadline for employers to ensure that crane 
operators are certified until November 10, 2018, and by extending the 
employer duty to ensure that crane operators are competent until that 
same date, this rule will avoid disrupting the construction industry 
and allow OSHA time to complete a related crane standard rulemaking 
that will address these and other issues.
    In this preamble, OSHA cites to documents in Docket No. OSHA-2007-
0066, the docket for this rulemaking. To simplify these document cites, 
they start with ``ID'' followed by the last four digits of their full 
docket identification number. For example, if a document's full docket 
identification number is ID-OSHA-2007-0066-1234, the cite used in this 
preamble would be ID-1234. The docket is available at https://www.regulations.gov, the Federal eRulemaking Portal.

B. Summary of Economic Impact

    This final rule is not economically significant. OSHA is revising 
29 CFR 1926.1427(k) (competency assessment and training) to delay the 
deadline for compliance with the operator-certification requirement in 
the crane standard for one year, and to extend the existing employer 
duty to ensure crane operator competency for the same period. OSHA's 
final economic analysis shows that delaying the date for operator 
certification and extending the employer's assessment of crane operator 
competency, rather than following the current crane standard, will 
result in a net cost savings for the affected industries. Delaying the 
compliance date for operator certification results in estimated cost 
savings that exceed the estimated new costs for employers to continue 
to assess crane operators to ensure their competent operation of the 
equipment in accordance with Sec.  1926.1427(k). The detailed final 
economic analysis is in the ``Agency Determinations'' section of this 
preamble.

C. Regulatory Background

1. Operator Certification Options
    On August 9, 2010, OSHA published the final crane standard. OSHA 
developed the standard through a negotiated rulemaking process. The 
Agency established a Federal advisory committee, the Cranes and 
Derricks Negotiated Rulemaking Advisory Committee (C-DAC), to develop a 
draft proposed rule. C-DAC met in 2003 and 2004 and developed a draft 
proposed rule (which included the provisions concerning crane operator 
certification at issue in this rulemaking) that it provided to OSHA.
    The Agency initiated a Small Business Advocacy Review Panel in 2006 
and published the proposed rule for cranes in construction on October 
9, 2008 (73 FR 59713). It closely followed C-DAC's draft proposal (73 
FR 59718). OSHA received public comment on the proposal, and conducted 
a public hearing. Among many other provisions, OSHA's 2010 final rule 
incorporated, with minor changes, the four-option certification scheme 
that C-DAC had recommended and the Agency had proposed. Accordingly, in 
Sec.  1926.1427, OSHA requires employers to ensure that their crane 
operators complete at least one of the following:
    Option 1. Certification by an independent testing organization 
accredited by a nationally recognized accrediting organization;
    Option 2. Qualification by an employer's independently audited 
program;
    Option 3. Qualification by the U.S. military; or
    Option 4. Compliance with qualifying State or local licensing 
requirements (mandatory when applicable).
    The third-party certification option in Sec.  1926.1427(b)--Option 
1--is the only certification option that is ``portable,'' meaning any 
employer who employs an operator may rely on that operator's 
certification as evidence of compliance with the crane standard's 
operator certification requirement. This certification option also is 
the only one available to all employers; it is the option OSHA, and the 
parties that participated in the rulemaking, believed would be the one 
most widely used. In this regard, OSHA is not aware of an audited 
employer qualification program among construction industry employers 
(Option 2), and the crane standard limits the U.S. military crane 
operator certification programs (Option 3) to Federal employees of the 
Department of Defense or the armed services. While State and local 
governments certify some crane operators (Option 4), the vast majority 
of operators who become certified do so through Option 1--by third-
party testing organizations accredited by a nationally recognized 
accrediting organization.
    Under Option 1, an independent testing organization tests crane 
operators to determine if they warrant certification. Before a testing 
organization can issue operator certifications, Sec.  1926.1427(b)(1) 
of the crane standard provides that a nationally recognized accrediting 
organization must accredit the testing organizations. To accredit a 
testing organization, the accrediting agency must determine that the 
testing organization meets industry-recognized criteria for written 
testing materials, practical examinations, test administration, 
grading, facilities and equipment, and personnel. The testing 
organization must administer written and practical tests that:
     Assess the operator's knowledge and skills regarding 
subjects specified in the crane standard;
     provide different levels of certification based on 
equipment capacity and type;
     have procedures to retest applicants who fail; and
     have testing procedures for recertification.
    Section 1926.1427(b)(2) of the crane standard also specifies that, 
for the purposes of compliance with the crane standard, an operator is 
deemed qualified to operate a particular piece of equipment only if the 
operator is certified for that type and capacity of equipment or for 
higher-capacity equipment of that type. It further provides that, if no 
testing organization offers certification examinations for a particular 
equipment type and/or capacity, the operator is deemed qualified to 
operate that equipment if the operator is certified for the type/

[[Page 51988]]

capacity of equipment that is most similar to that equipment, and for 
which a certification examination is available.
2. Overview of Sec.  1926.1427(k) (Phase-In Provision)
    The crane standard published in 2010 replaced provisions in 29 CFR 
part 1926, subpart N--Cranes, Derricks, Hoists, Elevators, and 
Conveyors, of the construction safety standards. OSHA delayed the 
deadline for the operator certification requirement for four years, 
until November 10, 2014 (see Sec.  1926.1427(k)(1)). During this four-
year ``phase-in'' period, the crane standard imposed an employer duty 
to ensure that crane operators could safely operate equipment (see 
Sec.  1926.1727(k), Phase-in). Thus, pursuant to Sec.  
1926.1427(k)(2)(i), OSHA required employers to ``ensure that operators 
of equipment covered by this standard are competent to operate the 
equipment safely.'' Under Sec.  1926.1427(k)(2)(ii), employers must 
train and evaluate the operator when the operator ``assigned to operate 
machinery does not have the required knowledge or ability to operate 
the equipment safely.''
3. Post-Final Rule Developments
    After OSHA issued the crane standard, it continued to receive 
feedback from members of the regulated community and conducted 
stakeholder meetings on April 2 and 3, 2013, to give interested members 
of the public the opportunity to express their views. Participants 
included construction contractors, labor unions, crane manufacturers, 
crane rental companies, accredited testing organizations, one of the 
accrediting bodies, insurance companies, crane operator trainers, and 
military employers. Detailed notes of participants' comments are 
available at ID-0539. Various parties informed OSHA that, in their 
opinion, the operator certification option would not adequately ensure 
that crane operators could operate their equipment safely at a 
construction site. They said that a certified operator would need 
additional training, experience, and evaluation, beyond the training 
and evaluation required to obtain certification, to ensure that he or 
she could operate a crane safely.
    OSHA also received information that two (of a total of four) 
accredited testing organizations have been issuing certifications only 
by ``type'' of crane, rather than offering different certifications by 
``type and capacity'' of crane, as the crane standard requires. The two 
organizations later confirmed this (ID-0521, p. 109 and 246). As a 
result, those certifications do not meet the standard's requirements 
and operators who obtained certifications only from those organizations 
could not, under OSHA's crane standard, operate cranes on construction 
sites after November 10, 2014. Some stakeholders in the crane industry 
requested that OSHA remove the capacity requirement.
    Most of the participants in the stakeholder meetings expressed the 
opinion that an operator's certification by an accredited testing 
organization did not mean that the operator was fully competent or 
experienced to operate a crane safely on a construction work site. The 
participants likened operator certification to a new driver's license, 
or a learner's permit, to drive a car. Most participants said that the 
operator's employer should retain the responsibility to ensure that the 
operator was qualified for the particular crane work assigned. Some 
participants wanted certification to be, or viewed to be, sufficient to 
operate a crane safely. Stakeholders noted that operator certification 
was beneficial in establishing a minimum threshold of operator 
knowledge and familiarity with cranes.

D. Initial Extension of the Employer Assessment Duties and Deadline for 
Operator Certification

    On February 10, 2014, OSHA published a proposal to delay the 
deadline for operator certification by three additional years to 
November 10, 2017, and to extend the existing employer duty to ensure 
crane operator competency for the same period (79 FR 7611). OSHA 
conducted a public hearing on May 19, 2014. Representatives of the 
construction industry reiterated that requiring the certification of 
all operators and supplanting the employer duty would not ensure the 
competency of crane operators to safely operate cranes to do 
construction work. A representative of one of the testing organizations 
that certifies by capacity (and who had previously opposed removing the 
capacity requirement) conceded that OSHA should undergo a rulemaking to 
consider removing capacity from certification requirements.
    On September 26, 2014, OSHA published a final rule that delayed the 
operator certification deadline and extended the existing employer duty 
for three years to November 10, 2017, to provide time for OSHA to 
consider what regulatory approach it should take (79 FR 57785).

E. Consulting ACCSH--Draft Proposal for Revised Crane Operator 
Requirements

    With the additional three-year extension in place, OSHA began work 
on a rulemaking to address the issues raised by stakeholders. On March 
31 and April 1, 2015, the Agency consulted with the Advisory Committee 
on Construction Safety and Health (ACCSH) to solicit feedback from 
industry stakeholders on the draft regulatory text for a revised 
operator certification standard.\1\ Prior to the meeting, OSHA made 
available the draft regulatory text,\2\ an overview of the draft 
regulatory text,\3\ and a summary of the site visits with 
stakeholders.\4\ OSHA received many comments and suggestions for 
revising the regulatory text at the ACCSH meeting. Since that meeting, 
the Agency has worked to re-draft the regulatory text and preamble for 
the proposed rule. To ensure the Agency has enough time to propose and 
finalize the rulemaking, OSHA proposed this one-year extension of the 
certification requirement compliance date (82 FR 41184 (Aug. 30, 
2017)). As with the previous extensions, OSHA also proposed an 
extension of the existing employer assessment duty for the same time 
period (Id.). OSHA requested public comment on these proposals.
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    \1\ Transcript for March 31: https://www.osha.gov/doc/accsh/transcripts/accsh_20150331.pdf; transcript for April 1: https://www.osha.gov/doc/accsh/transcripts/accsh_20150401.pdf.
    \2\ https://www.osha.gov/doc/accsh/accshcrane.pdf.
    \3\ https://www.osha.gov/doc/accsh/proposed_crane.html.
    \4\ https://www.osha.gov/doc/accsh/summary_crane.html.
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II. Summary and Explanation of the Final Rule

    Commenters in their written remarks on the proposal to delay the 
operator certification deadline and extend the existing employer duty 
to November 10, 2018 focused on three issues arising from the Agency's 
proposed changes: (1) Whether to delay the date for crane operators to 
be certified; (2) whether to extend the employer duty to ensure crane 
operators are competent and safe; and (3) the length of time of an 
extension. This section examines these issues--in the order above--by 
first summarizing the comments and then explaining the Agency's 
decisions and determinations based on the record as a whole.

[[Page 51989]]

A. Extension of Operator Certification Deadline

    The majority of commenters supported the Agency's proposed 
extension of the deadline for crane operators to be certified (ID-0545, 
0561, 0563, 0566, 0572-575, 0578-582, 0584-585, 0588-597, 0599-614, 
0617-618, 0621, 0624-627, 0632-640, 0642-643, 0645-647, 0651, 0653, 
0656-660, 0662-664, 0666-667). Most agreed that an extension was 
necessary to give OSHA time to address the issues regarding crane 
operation raised after publication of the crane standard: Whether to 
remove capacity from the crane standard's certification requirements 
and the preservation of the employer's role in assessing operators for 
safe crane operation (ID-0561, 0563, 0578, 0597, 0604, 0618, 0632, 
0636, 0640, 0646-647, 0650-651, 0656, 0658, 0667). The National 
Commission for the Certification of Crane Operators (NCCCO) supports 
this rule ``only in response to OSHA's stated need to address these two 
issues.'' (ID-0632). In support of the extension, The International 
Union of Operating Engineers (IUOE) stated that they along with 
``contractors, insurers, trade associations, and third-party 
certification bodies agree on the problems OSHA has identified . . . 
that OSHA's `deemed qualified' language eliminates the employer's duty 
. . .'' and ``that certification by `capacity' should be eliminated 
from the regulatory requirements.'' (ID-0651). They conclude that 
``[t]here is widespread agreement in the industry regarding the 
necessity to postpone implementation of these two elements of the rule 
in order to correct them.'' (Id.).
    Some commenters asked OSHA to delay the compliance date of the 
certification requirements in order to alleviate confusion that exists 
in the industry regarding the crane operator certification 
requirements. (ID-0604, 0606, 0642, 0647, 0650-651). In support of the 
extension, the IUOE asked OSHA to ``move quickly to eliminate the cloud 
of uncertainty that has hung over this key safety measure for over a 
decade.'' (ID-0651). Edison Electrical Institute hopes that ``OSHA 
works to clarify and formulate the necessary requirements for operator 
certification and qualification under the final rule'' as ``[t]here are 
still many questions that require answers on the certification process 
and granting this extension will enable OSHA to continue its work with 
impacted parties to ensure compliance is met and clarity is achieved.'' 
(ID-0642). Imperial Crane Services, Inc., and the Chicago Crane Owners 
Association support the extension ``so that crane operator's 
proficiency/qualification can be further clarified in the existing 
cranes and derrick standard.'' (ID-0604).
    Commenters were also very concerned that without an extension of 
the operator certification requirements and the employer's duty, there 
would be significant disruption to the construction industry. (ID-0561, 
0580, 0605, 0611, 0618, 0626-627, 0636, 0640, 0643, 0646, 0650). In the 
2014 extension, OSHA noted that the record indicated that roughly two-
thirds of certified operators were certified by one of the 
organizations that does not offer certification by capacity. Thus, some 
of the commenters observed that with a majority of certified operators 
possessing a certification by crane type only, many employers of crane 
operators would be in violation of operating a crane under OSHA 
requirements and barred from operating a crane without the possibility 
of being cited by OSHA. The Texas Crane Owners Association asserts that 
without an extension, ``the obligations under [the crane standard] will 
undoubtedly disrupt the construction industry by creating a large 
number of crane operators without compliant certification.'' (ID-0646). 
The Associated General Contractors of America agrees that failure to 
delay the compliance date ``could potentially result in significant 
disruptions in the construction industry with the number of crane 
operators in possession of certifications that would be deemed 
noncompliant if the November 10, 2017, effective date remains in 
place.'' (ID-0640). Similarly, The Associated Builders and Contractors, 
Inc., (ABC) commented that ``many in the construction industry believe 
that without an extension the industry will face a future crane 
operator shortage. For the industry to continue to perform work without 
disruption, it is important an extension is granted.'' (ID-0650). 
``[W]ithout the proposed extension there will be a significant 
disruption to the industry come November 10, 2017,'' commented North 
America's Building Trades Unions, continuing that ``many operators will 
no longer be able to operate certain cranes because their current 
certifications are not by crane capacity as currently called for in the 
rule.'' (ID-0618).
    Commenters opposed to the extension of the certification deadline 
expressed concern that it would lead to unsafe worksites. (ID-0557, 
0562/0665 (duplicate comments), 0571, 0577, 0620, 0629, 0644, 0649, 
0652). Jack Pitt of Murray State University commented that if OSHA 
delayed the compliance date, ``then safety would not be a priority,'' 
continuing that it was his opinion that requiring certification 
immediately ``would eliminate quite a number of fatalities and 
injuries. . . .'' (ID-0665 and 0562). Chas Scott of Murray State 
University commented that ``[t]he longer the rule is delayed, the more 
fatalities that are likely to occur.'' (ID-0557).\5\
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    \5\ This commenter misinterpreted OSHA's previous benefits 
estimate, which stated that the cranes standard would prevent 22 
fatalities per year, as meaning that the enforcement of the operator 
certification requirement would alone prevent that number of 
fatalities. But as OSHA noted in the 2014 extension in response to 
similar assertions, in calculating the benefits from fatalities 
prevented ``OSHA did not identify individual components of the 
standard, but rather calculated the benefits of the entire cranes 
standard as a whole. OSHA did not separately itemize benefits 
accruing from the operator certification requirements.'' (79 FR 
57788, footnote 2).
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    In making their arguments about the impact of the certification 
deadline extension on safety, several of these comments equated crane 
operator training and crane operator certification. (ID-0571, 0577, 
0620, 0629, 0644, 0649, 0652). OSHA had previously addressed the same 
issue in its 2014 extension, pointing out that for the requirements for 
crane operator training at 29 CFR 1926.1427(f), like the other 
provisions from the crane standard except certification, are currently 
in effect and would not be impacted by any extension (see 79 FR 57788). 
Employers currently have, and will continue to have, a responsibility 
to ensure crane operators they employ are trained according to that 
standard.
    Other comments in opposition of the extension stated that employers 
have had enough time to make sure that their operators are certified, 
meeting the certification requirements of the 2010 final rule. (ID-
0542, 0551, 0556, 0558, 0568, 0583, 0587, 0615-616, 0622-623, 0630-631, 
0652, 0661). An anonymous commenter stated that ``[s]afety conscious 
construction employers know or should have known of this new operator 
certification requirement and have been given a substantial amount of 
time to comply,'' (ID-0551). Another commenter noted that employers of 
crane operators ``have had seven years to get the new certification.'' 
(ID-0661).
    Based on the record as a whole, OSHA finds the arguments in favor 
of delaying the operator certification deadline to be more persuasive. 
OSHA shares the commenters' concerns about a potential disruption to 
the industry that might occur if the majority of certified operators 
currently hold a form of certification that would not comply

[[Page 51990]]

with OSHA's standard. The impact on the industry would be particularly 
unwarranted in light of OSHA's public disclosure to ACCSH during the 
committee's meeting on March 31 and April 1, 2015, that the Agency 
intends to propose removing the capacity component of certification, 
which is the sole reason that most of these operator certifications 
would not comply with OSHA's standard. OSHA also acknowledges the 
commenters' point that while there has been time for more operators to 
become certified, many employers may have delayed in requiring their 
employees to be certified while they waited for OSHA to clarify the 
criteria for the certification so that they could avoid spending funds 
on a certification that would not meet OSHA's standard. To the extent 
that the Agency's actions have contributed to this uncertainty, OSHA 
agrees that it would not be fair to penalize employers by enforcing the 
certification requirement before completing the separate rulemaking to 
change that criteria. The additional one-year extension will provide 
the Agency with the time it needs to address those concerns.

B. Extension of the Existing Employer Duty

    The commenters who specifically addressed the extension of the 
existing employer assessment duty were unanimous in supporting the 
extension to ensure that employers retained responsibility for ensuring 
that their operators are competent to operate cranes. All of the 
comments opposed to the one-year extension focused entirely on 
certification and did not mention the employer duty.
    The North America's Building Trades Union commented that ``without 
the proposed extension there would not be an employer duty to ensure 
operators can safely operate equipment, which not only puts the 
operator at risk of fatality or injury, but also puts all construction 
workers around the equipment at risk as well as the general public on 
certain construction projects.'' (ID-0618). The IUOE argues that even 
if certification is required, ``[c]ertification alone . . . is simply 
insufficient in the absence of subsequent employer qualification to 
ensure that a crane operator is qualified to safely operate the crane 
to which he or she is assigned.'' (ID-0651).
    While OSHA is not prepared to make a determination whether 
certification alone is insufficient as the IUOE claims, OSHA agrees 
that in order to ensure safe and competent crane operations during the 
one-year extension, the employer duty must also be extended. Without an 
extension of the employer duty, the standard would have no requirement 
to ensure that crane operators know how to operate the crane safely 
during the operator certification extension. Therefore it is important 
that the Agency extend the employer duty while it engages in subsequent 
rulemaking.

C. Length of the Extensions

    Having determined that it is appropriate to delay the certification 
deadline and extend the employer duty to ensure operator competence, 
the remaining issue is the length of the extension. In the NPRM, OSHA 
proposed delaying the operator certification deadline and extending the 
existing employer duty for one year, until November 10, 2018. OSHA 
requested comment on the duration of the extension.
    The majority of comments support OSHA's proposed extension of the 
deadline for crane operator certification and the employer duty for one 
year. (ID-0545, 0561, 0563, 0566, 0572-575, 0578, 0580-582, 0585, 0588-
600, 0602-605, 0607-614, 0617-618, 0621, 0624-627, 0632-640, 0642-643, 
0645-647, 0651, 0653, 0656-660, 0662-6664, 0666-667). Some of these 
comments recommend that OSHA move as quickly as possible to address 
these rules. (ID-0605, 0618, 0632, 0651, 0656). NCCCO agrees with the 
Agency's proposed extension and ``urges OSHA to act with all speed to 
ultimately issue its Final Rule well within the extension on this 
vitally important safety issue. . . .'' (ID-0632). Jonathan Branton of 
Murray State University commented that ``this issue does not need to be 
pushed back any further than one year'' and it is ``OSHA's 
responsibility to not allow this to be further extended.'' (ID-0605). 
The IUOE asked the Agency to ``[p]lease do everything in your power to 
ensure that OSHA completes the process by November 2018.'' (ID-0651).
    Additionally, OSHA received comments recommending an extension of 
three years and an indefinite extension until OSHA addresses the 
certification issues raised by stakeholders after publication of the 
2010 final cranes and derricks standard.
    The National Propane Gas Association (NPGA) recommended delaying 
the deadline for the certification requirement and extending the 
employer duty ``at least three years'', arguing that ``if three years 
was not an adequate amount of time'' to address certification issues 
raised by stakeholders, ``it is not reasonable to presume one year is 
sufficient.'' (ID-0648). The NPGA continues that ``[w]e are concerned 
that the short delay is indicative of the agency's intent to conduct an 
expedited process . . . . an accelerated rulemaking would be 
antithetical to the purpose and spirit of public engagement in the 
regulatory process.'' (ID-0648). The National Association of Home 
Builders recommends that OSHA delay the deadline for the certification 
requirements and extend the employer duty another three years or 
indefinitely, arguing that ``OSHA needs to ensure the certification 
procedures will actually improve safety'' and not allowing enough time 
to address certification issues ``only hurts the workers and the 
regulated community with continually changing deadlines and 
requirements.'' (ID-0598). ABC also recommended that both the deadline 
for the certification requirement be delayed and the employer duty be 
extended indefinitely as recommended by ACCSH in 2014, arguing that a 
one year delay ``will not provide a sufficient amount of time for OSHA 
to complete a further rulemaking. . . . Limiting the amount of time the 
agency has to complete the rulemaking could lead to rushed and unclear 
regulations.'' (ID-0650).
    While OSHA appreciates the concern of some stakeholders that a one-
year extension is an insufficient amount of time to address the issues 
raised by the industry after publication of the crane standard, OSHA is 
not persuaded an extension longer than one year is necessary. OSHA had 
not even decided whether to pursue rulemaking when it finalized the 
three-year extension in 2014. The Agency needed time to determine what 
regulatory approach would be appropriate for addressing the concerns 
raised by stakeholders after publication of the crane standard. (79 FR 
7613). OSHA took time to make site visits and spoke to over 40 industry 
representatives about crane operator certification and operator 
competency. Using this information, OSHA drafted regulatory text that 
it presented to a special meeting of ACCSH on March 31, and April 1, 
2015, where several stakeholders had the opportunity to provide 
feedback to the Agency.\6\ OSHA has taken the information from that 
meeting and worked to develop a proposed rule addressing stakeholders' 
concerns. OSHA has nearly completed that proposed rule and intends to 
publish it for public comment shortly.
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    \6\ Transcript for March 31: https://www.osha.gov/doc/accsh/transcripts/accsh_20150331.pdf; transcript for April 1: https://www.osha.gov/doc/accsh/transcripts/accsh_20150401.pdf.
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    OSHA is in a different point of the process than it was three years 
ago and is confident that it will be able to

[[Page 51991]]

complete the rulemaking within the year extension without curtailing 
the opportunity for stakeholders and the general public to participate 
fully in the rulemaking process.
    The Agency rejects the calls for an indefinite extension for the 
same reasons that it rejected them in 2014. Failing to specify a 
compliance deadline for operator certification is likely to result in 
greater, not less, confusion. In addition, if OSHA does not designate a 
fixed period after which the certification requirements would 
automatically take effect, the Agency may face additional legal 
challenges to reinstating them. Moreover, OSHA has already dedicated a 
significant amount of time and resources to implementing the existing 
standard, including conducting an extensive negotiated rulemaking 
process before requiring that employers ensure their crane operators 
are certified. The Agency therefore finds it prudent and efficient to 
maintain the status quo for one more year while it considers additional 
rulemaking.
    The Agency must balance the rationale for an additional extension 
against the concerns raised by the other commenters who point out that 
any unnecessary delay in the operator certification requirement could 
prevent the Agency from obtaining the full safety benefit of the cranes 
standard. For example, if OSHA delayed the operator certification 
requirement for another three years but completed its rulemaking within 
nine months, then delaying the certification deadline would be clearly 
excessive and needlessly delay safety benefits. OSHA believes that 
given the progress it has made developing a rule addressing 
stakeholders' concerns regarding operator certification, a one-year 
extension of both the deadline for the certification requirement and 
the employer duty is appropriate.
    Therefore, OSHA has decided to delay the operator certification 
deadline for one year, until November 10, 2018, and to extend the 
employer duty to ensure that crane operators are competent to operate a 
crane safely for the same one-year period, as it proposed. The Agency 
received no comment on the text of its proposed revision to Sec.  
1926.1427(k), and the final rule adopts the provision as proposed.

D. Comments Outside the Scope of This Rulemaking

    OSHA received comments to this rulemaking that, in part or in 
whole, asked the agency to consider alternatives and revisions to the 
certification requirements from the 2010 final rule. (ID-0544, 0546, 
0548, 0549, 0555, 0564, 0567, 0598, 0606, 0639, 0646, 0648, 0651, 0655, 
0658, 0660, 0663, 0667). These comments, although related to operator 
certification and the employer duty, are outside the scope of this 
rulemaking and the narrowly tailored issue OSHA proposed: Whether the 
deadline for the operator certification requirements should be delayed 
and whether the employer duty to ensure safe and competent crane 
operation should be extended by one year.

III. Agency Determinations

A. Final Economic Analysis and Regulatory Flexibility Analysis

    When it issued the final cranes rule in 2010, OSHA prepared a final 
economic analysis (2010 FEA) as required by the Occupational Safety and 
Health Act of 1970 (OSH Act; 29 U.S.C. 651 et seq.) and Executive 
Orders 12866 (58 FR 51735) (Sept. 30, 1993) and 13563 (76 FR 3821 (Jan. 
21, 2011)). OSHA also published a Final Regulatory Flexibility Analysis 
as required by the Regulatory Flexibility Act (5 U.S.C. 601-612). On 
September 26, 2014, the Agency included a separate FEA (2014 FEA) when 
it published a final rule delaying until November 10, 2017, the 
deadline for all crane operators to become certified, and extending the 
employer duty to ensure operator competency for the same period (79 FR 
57785). The preliminary economic analysis for this crane rule extension 
(2017 PEA) was based on these documents along with further analysis and 
is the basis for this final economic analysis (FEA). There were no 
comments submitted to the record in response to the 2017 PEA that 
included data that could alter OSHA's analysis; therefore, this FEA is 
substantially the same as the 2017 PEA.
    Because OSHA estimates this rule will have a cost savings for 
employers of $4.4 million using a discount rate of 3 percent for the 
one year of the extension, this final rule is not economically 
significant within the meaning of Executive Order 12866, or a major 
rule under the Unfunded Mandates Reform Act or Section 804 of the Small 
Business Regulatory Enforcement Fairness Act of 1996 (5 U.S.C. 801 et 
seq.).
    This FEA focuses solely on costs, and not on any changes in safety 
and benefits resulting from delaying the certification deadline and 
extending the employer duties under Sec.  1926.1427(k)(2). As OSHA 
noted in its proposal, the Agency previously provided its assessment of 
the benefits of the cranes standard in the 2010 FEA. OSHA did not 
receive any comment on this approach or any request for additional 
analysis of benefits. As noted elsewhere in this preamble, the primary 
rationale for this final rule is to maintain the status quo--including 
preservation of the employer duty to ensure that crane operators are 
competent--while providing OSHA additional time to conduct rulemaking 
on the crane operator requirements in response to stakeholder concerns.
    Extending the employer's requirement to ensure an operator's 
competency during this period means taking the same approach of the 
previous extension: Continuing measures in existence since OSHA 
published the crane standard in 2010. As OSHA stated in the preamble to 
the 2010 final rule, the interim measures in paragraph (k) ``are not 
significantly different from requirements that were effective under 
subpart N of this part at former Sec.  1926.550, Sec.  1926.20(b)(4) 
(`the employer shall permit only those employees qualified by training 
or experience to operate equipment and machinery'), and Sec.  
1926.21(b)(2) (`the employer shall instruct each employee in the 
recognition and avoidance of unsafe conditions . . .')'' (75 FR 48027).
    Delaying the operator certification requirement defers a regulatory 
requirement and produces cost savings for employers. There will, 
however, be continuing employer costs for extending the requirement to 
assess operators under existing Sec.  1926.1427(k)(2); if OSHA does not 
extend these requirements, they will expire in November 2017 and 
employers would not have these costs after 2017. With the extension, 
these continuing employer costs will be offset by a reduction in 
expenses that employers would otherwise have been required to incur to 
ensure that their operators are certified before the existing November 
2017 deadline.
Overview
    In the following analysis, OSHA examines costs and savings to 
determine the net economic effect of the rule. By comparing the 
additional assessment costs to the certification cost savings across 
two scenarios--scenario 1 in which there is no extension of the 2017 
deadline, and scenario 2 in which there is an extension until 2018--
OSHA estimates that the extension will produce a net savings for 
employers of $4.4 million per year using a discount rate of 3 percent 
($5.2 million per year using an interest rate of 7 percent).\7\
---------------------------------------------------------------------------

    \7\ As explained in the following discussion, OSHA typically 
calculates the present value of future costs and benefits using two 
interest rate assumptions, 3 percent and 7 percent, as recommended 
by OMB Circular A-4 of September 17, 2003. All dollar amounts unless 
otherwise stated are in 2016 dollars.

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

[[Page 51992]]

    OSHA's analysis follows the steps below to reach its estimate of an 
annual net $4.4 million in savings:
    (1) Estimate the annual assessment costs for employers;
    (2) Estimate the annual certification costs for employers; and
    (3) Estimate the year-by-year cost differential for delaying the 
certification deadline to 2018.\8\
---------------------------------------------------------------------------

    \8\ Though this is a single year extension, the analysis needs 
to extend over several future years. For convenience, OSHA refers to 
the annual time period as a ``Certification Year'' (CY) in this 
economic analysis, which OSHA defines as ending November 10 of the 
calendar year; e.g., CY 2017 runs from November 10, 2016, to 
November 9, 2017.
---------------------------------------------------------------------------

    The methodology used here is substantially the same as used in the 
2014 extension FEA, and OSHA did not receive any comment on this 
methodology when it included it in the 2017 PEA. Below, Table 1 
summarizes these costs and the differentials across the two scenarios. 
The major differences are updated wages and a revised forecast of the 
composition of the operator pool across certification levels. The 2014 
FEA analysis addressed a 3-year extension, so it gradually increased 
the number of operators without any certification during that period. 
The model in this PEA addresses an extension of just a single year, so 
it holds the number of operators with each certification level 
constant. The latter significantly simplifies the analysis versus that 
presented in the 2014 FEA extension.
a. Annual Assessment Costs
    OSHA estimated the annual assessment costs using the following 
three steps: First, determine the unit costs of meeting this 
requirement; second, determine the number of assessments that employers 
will need to perform in any given year (this determination includes 
estimating the affected operator pool as a preliminary step); and 
finally, multiply the unit costs of meeting the requirement by the 
number of operators who must meet it in any given year.
    Unit assessment costs. OSHA's unit cost estimates for assessments 
take into account the time needed for the assessment, along with the 
wages of both the operator and the personnel who will perform the 
assessment. OSHA based the time requirements on crane operator 
certification exams currently offered by nationally accredited testing 
organizations. OSHA determined the time needed for various 
certification tests from the 2014 extension, drawing primarily from 
informal conversations with industry sources who participated in the 
public stakeholder meetings.
    The Agency estimates separate assessment costs for three types of 
affected operators, which together comprise all affected operators: 
Those who have a certificate that is in compliance with the existing 
cranes standard; those who have a certificate that is not in compliance 
with the existing cranes standard; and those who have no 
certificate.\9\ As it did in the previous extension, OSHA uses 
certification status as a proxy of competence in estimating the amount 
of assessment time needed for different operators. OSHA expects that an 
operator already certified to operate equipment of a particular type 
and capacity will require less assessment time than an operator 
certified by type but not capacity, who in turn will require less time 
than an operator who is not certified. In deriving these estimates, 
OSHA determined that operators who have a certificate that is compliant 
with the crane standard would have to complete a test that is the 
equivalent of the practical part of the standard crane operator test. 
The Agency estimates that it would take an operator one hour to 
complete this test. Operators who have a certificate that is not in 
compliance with the cranes standard would have to complete a test that 
is equivalent to both a written general test and a practical test of 
the standard crane operator test. OSHA estimated that the written 
general test would take 1.5 hours to complete, for a total test time of 
2.5 hours of testing for each operator (1.5 hours for the written 
general test and 1.0 hour for the practical test). Finally, operators 
with no certificate would have to complete a test that is equivalent to 
the standard written test for a specific crane type (also lasting 1.5 
hours), as well as the written general test and the practical test, for 
a total test time of 4.0 hours (1.5 hours for the test on a specific 
crane type, 1.5 hours for the written general test, and 1.0 hour for 
the practical test).
---------------------------------------------------------------------------

    \9\ OSHA is not making any determination about whether a 
specific certification complies with the requirements of the cranes 
standard. For the purposes of this analysis only, OSHA will treat 
certificates that do not include a multi-capacity component as not 
complying with the cranes standard, and certificates that include 
both a type and multi-capacity component as complying with the 
cranes standard.
---------------------------------------------------------------------------

    The wages used for the crane operator and assessor come from the 
BLS Occupational Employment Survey for May 2016 (BLS 2017a), which is 
an updated version of the same source used in the 2014 extension. From 
this survey a crane operator's (Standard Occupational Classification 
(SOC) 53-7021 Crane and Tower Operators) average hourly wage is $26.58. 
The full cost to the employer includes all benefits as well as the 
wage. From the BLS Employer Costs For Employee Compensation for 
December 2016 (BLS 2017b) the average percentage of benefits in total 
for the construction sector is 30.2 percent, giving a markup of the 
wage to the total compensation of 1.43 (1/(1 - 0.302)). Hence the 
``loaded'' total hourly cost of an operator is $38.08 (1.43 x $26.58), 
including a markup for benefits.\10\ Relying on the same sources, the 
wage of the assessor is estimated to be the same as the average wage of 
a construction supervisor (53-1031 First-Line Supervisors of 
Transportation and Material-Moving Machine and Vehicle Operators) of 
$28.75, while the total hourly cost is $41.19 (1.43 x $28.75). Below 
these total hourly costs will be referred to as the respective 
occupation's ``wage.'' For assessments performed by an employer of a 
prospective employee (i.e., a candidate), OSHA uses these same operator 
and assessor wages and the above testing times to estimate the cost of 
assessing prospective employees.
---------------------------------------------------------------------------

    \10\ Calculations in the text may not exactly match due to 
rounding for presentation purposes. All final costs are exact, with 
no rounding.
---------------------------------------------------------------------------

    Multiplying the wages of operators, assessors, and candidates by 
the time taken for each type of assessment provides the cost for each 
type of assessment. Hence, the cost of assessing an operator already 
holding a certificate that complies with the standard (both type and 
capacity) is one hour of both the operator's and assessor's time: 
$79.27 ($38.08 + $41.19). For an operator with a certificate for crane 
type only (not crane capacity), the assessment time is 2.5 hours for a 
cost of $198.17 (2.5 x ($38.08 + $41.19)). Finally, for an operator 
with no certificate, the assessment time is 4.0 hours for a cost of 
$317.48 (4.0 x ($38.08 + $41.19)). OSHA did not receive any comments on 
these unit cost estimates.
    Besides these assessment costs, OSHA notes that Sec.  
1926.1427(k)(2)(ii) requires employers to provide training to employees 
if they are not already competent to operate their assigned equipment. 
To determine whether an operator is competent, the employer must first 
perform an assessment. Only if an operator fails the assessment must 
the employer provide additional operator training required by Sec.  
1926.1427(k)(2)(ii).

[[Page 51993]]

    However, in determining this cost, OSHA made a distinction between 
a nonemployee candidate for an operator position and an operator who is 
currently an employee. For an employer assessing a nonemployee 
candidate, OSHA assumed, based on common industry practice, that the 
employer will not hire a nonemployee candidate who fails the 
assessment. In the second situation, an employee qualified to operate a 
crane fails an assessment for a crane that differs in type or capacity 
from the crane the employee currently operates. In this situation, the 
cost-minimizing action for the employer is not to assign the employee 
to that new type and/or capacity crane, thereby avoiding training 
costs. While the Agency acknowledges that there will be cases in which 
the employer will provide this training, it believes these costs to be 
minimal and, therefore, is not estimating costs for the training. OSHA 
made the same determinations in the 2017 PEA and did not receive public 
comment on them.
    Number of assessments and number of affected operators. The number 
of assessments is difficult to estimate due to the heterogeneity of the 
crane industry. Many operators work continuously for the same employer, 
already have had their assessment, and do not need reassessment, so the 
number of new assessments required by the cranes standard for these 
operators will be zero. Some companies will rent both a crane and an 
operator employed by the crane rental company to perform crane work, in 
which case the rental crane company is the operator's employer and 
responsible for operator assessment. In such cases there is no 
requirement for the contractor who is renting the crane service to 
conduct an additional operator assessment. Assuming that employers 
already comply with the assessment and training requirements of the 
existing Sec.  1926.1427(k)(2), employers only need to assess a subset 
of operators: New hires; employees who will operate equipment that 
differs by type and/or capacity from the equipment on which they 
received their current assessment; and operators who indicate that they 
no longer possess the required knowledge or skill necessary to operate 
the equipment.
    To calculate the estimated annual number of assessments, OSHA first 
estimated the current number of crane operators affected by the cranes 
standard. The 2014 FEA estimated 117,130 operators and this FEA also 
uses this estimate. The Agency solicited comment and additional data on 
this estimate but received none.
    For the purpose of determining the number of assessments required 
each year under this proposal, OSHA is relying on the 23 percent 
turnover rate for operators originally identified in the 2008 PEA for 
the crane rule and used most recently in the 2014 extension FEA (79 FR 
57793) and the 2017 PEA for this rule. OSHA requested comment on this 
rate, but received none.
    This turnover rate includes all types of operators who would 
require assessment: Operators moving between employers; operators 
moving between different types and/or capacities of equipment; and 
operators newly entering the occupation. OSHA estimated that 26,940 
assessments occur each year based on turnover (i.e., 117,130 operators 
x 0.23 turnover rate). In addition, just as it did with the previous 
extension, OSHA assumed that 15 percent of operators involved in 
assessments related to turnover would fail the first test 
administration and need reassessment (79 FR 57793). Therefore, OSHA 
added 4,041 reassessments (26,940 assessments x 0.15) to the number of 
reassessments resulting from turnover, for an annual total of 30,981 
assessments resulting from turnover and test failure (26,940 + 4,041).
    Annual assessment costs. OSHA must determine the annual base amount 
for the two scenarios: (1) Retaining the original 2017 deadline (status 
quo); and (2) delaying the deadline to 2018 (extension NPRM).
    The first part of the calculation is the same under both scenarios. 
Because the annual assessment costs vary by the different levels of 
assessment required (depending on the operator's existing level of 
certification), OSHA grouped the 117,130 operators subject to the crane 
standard into three classifications: Operators with a certificate that 
complies with the standard; operators with a certificate only for crane 
type; and operators with no certification. In order to simplify the 
estimation for this one-year extension (the 2014 extension was for 3 
years) and reflect the last hard data point the Agency has, the Agency 
is using a static crane operator pool and the composition of the base 
operator population used in the 2014 deadline extension: 15,000 crane 
operators currently have a certificate that complies with the existing 
cranes standard, 71,700 have a certificate for crane type only (but not 
capacity), leaving 30,430 crane operators with no crane certification 
(117,130 total operators - (15,000 operators with compliant 
certification + 71,700 operators with certification for type only)).
    Assuming the turnover rate of 23 percent and the failure rate of 15 
percent for turnover-related assessments are distributed proportionally 
across the three types of operators, then the number of assessments for 
operators with compliant certification is 3,968 ((0.23 + (0.23 x 0.15)) 
x 15,000), the number of assessments for operators with type-only 
certification is 18,965 ((0.23 + (0.23 x 0.15)) x 71,700), and the 
number of assessments for operators with no certification is 8,049 
((0.23 + (0.23 x 0.15)) x 30,430).
    Under scenario 2, there is an extension and employers would not 
certify all of their operators during CY 2017. OSHA estimated the CY 
2017 assessment costs for scenario 2 by multiplying the assessment 
numbers for each type of operator by the unit costs, resulting in a 
cost of $6,624,861 (($79.27 x 3,968) + ($198.17 x 18,965) + ($317.08 x 
8,049)). Under scenario 1, the employer-assessment requirement will be 
in effect for all of CY 2017, while employers would be gradually 
certifying all of their operators during CY 2017. As a result, the CY 
2017 assessment costs identified for scenario 2 would decrease to 
$4,540,348 from $6,624,861 in scenario 1. This is because, as compared 
to scenario 2, there will be more operators who will have a compliant 
certificate; and therefore, under the approach described above the 
employer assessment will require less time. This reduction in the 
estimated time; and therefore, unit cost, lowers the overall assessment 
cost (see discussion in the 2014 deadline extension FEA for more 
details about this methodology).
    Under both scenarios, once the certification requirement becomes 
effective, the employer duty to assess the crane operator no longer is 
in effect and so assessment costs are zero. Thus, in CY 2018, the 
assessment costs under scenario 1 would be zero. Under scenario 2, the 
assessment costs for CY 2018 would be the same as those under scenario 
1 for CY 2017, because employers would be gradually certifying 
operators over the course of that year.
b. Annual Certification Costs
    OSHA estimated the annual certification costs using the three 
steps: First, determine the unit costs of meeting this requirement; 
second, determine the number of affected operators; and, finally, 
multiply the unit costs of meeting the requirement by the number of 
operators who must meet them. In this FEA, following the same 
methodology as in the 2014 FEA, OSHA estimates that all certifications 
occur in the year prior to the deadline, hence in CY 2017 in scenario 
1, while in CY 2018

[[Page 51994]]

for the one-year extension in scenario 2. As in the annual assessment-
cost analysis described above, OSHA provides the calculations for CY 
2017 under the existing 2017 deadline (scenario 1), and then presents 
the certification costs for CY 2018 that result from OSHA's delay of 
the certification requirement to November 2018 (scenario 2).
    Unit certification costs. Unit certification costs vary across the 
three different types of operators in the operator pool (operators with 
compliant certification; operators with type-only certification; and 
operators with no certification). Among operators without certification 
there is a further distinction with different unit certification costs: 
Experienced operators without certification and operators who have only 
limited experience. As such, there are different unit certification 
costs for four different types of operators. There also are ongoing 
certification costs due to the following two conditions: The 
requirement for re-certification every five years and the need for some 
certified operators to obtain additional certification to operate a 
crane that differs by type and/or capacity from the crane on which they 
received their current certification.
    OSHA estimated these different unit certification costs using 
substantially the same unit-cost assumptions used in the FEA for the 
2010 cranes standard (and exactly the same as the FEA of the 2014 
deadline extension). In those previous FEAs, OSHA estimated that 
training and certification costs for an operator with only limited 
experience would consist of $1,500 for a 2-day course (including tests) 
and 18 hours of the operator's time, for a total cost of $2,185.44 
($1,500 + (18 hours x $38.08)) (see 75 FR 48096-48097). OSHA continues 
to use a cost of $250 for the tests taken without any training (a 
constant fixed fee irrespective of the number of tests (75 FR 48096)), 
and the same number of hours used for each test that it used in the 
assessment calculations provided above (which the Agency based on 
certification test times). Accordingly, OSHA estimates the cost of a 
certificate compliant with the crane standard for an operator who has a 
type-only certificate to be $345.20 (i.e., 1 type/capacity-specific 
written test at 1.5 hours and 1 practical test at 1.0 hours (2.5 hours 
total), plus the fixed $250 fee for the tests (2.5 hours x $38.08) + 
$250). For an experienced operator with no certificate, the cost is 
$402.32 (i.e., the same as the cost for an operator with a type-only 
certificate plus the cost of an added general written test of 1.5 hours 
(4.0 hours x $38.08) + $250)).\11\
---------------------------------------------------------------------------

    \11\ There are no certification costs for operators who already 
have a certificate that complies with the cranes standard.
---------------------------------------------------------------------------

    For scenario 1, Sec.  1926.1427(b)(4) specifies that a certificate 
is valid for five years. OSHA estimates the recertification unit cost 
would be the same as the assessment for an operator with compliant 
certification (i.e., $79.27). In the 2014 extension, OSHA assumed that 
employers would pay a reduced fee for the recertification testing as 
opposed to the cost of a full first-time examination. Because OSHA 
lacked data on exactly how much the fee would be reduced, it used the 
assessment cost as a proxy for the cost of recertification (79 FR 
57794). OSHA did not receive any comment on that approach and is 
retaining it for this FEA.
    Finally, there will be certified operators who must obtain 
certification when assigned to a crane that differs by type and/or 
capacity from the crane on which they received their current 
certification. This situation requires additional training, but less 
training than required for a ``new'' operator with only limited 
experience. Accordingly, OSHA estimated the cost for these operators as 
one half of the cost of training and certifying a new operator, or 
$1,092.72 ($2,185.44/2).
    Number of certifications. After establishing the unit certification 
costs, OSHA had to determine how many certifications are necessary to 
ensure compliance with OSHA's standard. In doing so, the Agency uses 
the 5 percent new-hire estimate from the FEA discussed above to 
calculate the number of new operators; therefore, of the 117,130 
operators affected by the standard, 5,857 (0.05 x 117,130) would be new 
operators who would require two days for training and certification 
each year. As discussed earlier, OSHA estimated that 71,700 operators 
have type-only certification, 15,000 operators have certification that 
complies with the existing cranes standard, and the remaining 24,574 
operators (117,130 - (71,700 + 15,000 + 5,857)) are experienced 
operators without certification.
    Under scenario 1 (no extension), after all operators attain 
certification by November 2017 there will still be ongoing 
certification costs each year. With a constant total number of 
operators, the same number of operators (5,857) will be leaving the 
profession each year and will not require recertification when their 
current 5-year certification ends. This leaves 111,274 operators 
(117,130 - 5,857) who will need such periodic recertification. If we 
approximate the timing of requirements for recertification as 
distributed proportionally across years, then 20 percent of all 
operators with a 5-year certificate (22,255 operators (.20 x 111,274)) 
would require recertification each year.
    A final category of unit certification costs involves the 
continuing need for certified operators to obtain further certification 
when assigned to a crane that differs by type and/or capacity from the 
crane on which they received their current certification. This 
situation arises for both operators working for a single employer and 
operators switching employers.
    The operators who will not need multiple certifications in the 
post-deadline period are operators with certification who move to a new 
employer and operate a crane with the same type and capacity as the 
crane on which they received certification while with their previous 
employer. These operators will not need multiple certifications because 
operator certificates are portable across employers, as specified by 
the cranes standard (see Sec.  1926.1427(b)(3)). For an employer 
looking to hire an operator for a specific crane, this option will 
minimize cost, and OSHA assumes employers will choose this option when 
possible.
    After the certification deadline, OSHA estimates that each year 23 
percent of the 117,130 operators (26,940 = 0.23 x 117,130) will enter 
the workforce, change employers, or take on new positions that require 
one or more additional certifications to operate different types and/or 
capacities of cranes. Of these 26,940 operators, OSHA estimates 5 of 
the total 23 percent, or 5,857 (0.05 x 117,130), will result from new 
operators entering the occupation each year; 9 percent, or 10,542 (0.09 
x 117,130), will result from operators switching employers but 
operating a crane of the same type and capacity as the crane they 
operated previously (i.e., no certification needed because 
certification is portable in this case); and the remaining 9 percent, 
or 10,542, changing jobs or positions and requiring one or more 
additional certification to operate a crane that differs by type and/or 
capacity from the crane they operated previously. These percentages are 
identical to those in the 2014 FEA and the 2017 PEA.
    Annual certification costs. To estimate the annual base cost for 
the first scenario, OSHA calculates the certification costs for CY 2017 
because that is the remaining period before the existing deadline. The 
total cost for

[[Page 51995]]

certifying all operators in CY 2017 in accordance with the existing 
cranes standard using the above unit-cost estimates and numbers of 
operators is $47,436,368 ((71,700 operators with type-only 
certification x $345.20) + (24,574 experienced operators without 
certification x $402.32) + (5,857 operators with no experience or 
certification x $2,185.44)). The Agency, following the previous FEAs 
(75 FR 48096 and 79 FR 57795), annualized this cost for the five-year 
period during which operator certification remains effective, resulting 
in an annualized cost of $8,447,719. In section c below, OSHA uses this 
amount in calculating the annual certification costs under scenario 1.
    To determine the annual amount used in calculations for the second 
scenario (the extension to 2018), OSHA examines the costs in CY 2017 
because that is the first year with certification costs. All numbers 
are the same, just shifted forward a year, so the total cost for having 
all crane operators certified in CY 2018 is $47,436,368 (in 2018 
dollars).
c. Year-by-Year Cost Differential for Delaying the Certification 
Deadline to 2018 and Preserving the Employer Assessment Duty Over That 
Same Period
    The ultimate goal of this analysis is to determine the annualized 
cost differential between scenario 1 (the status quo) and scenario 2 
(the extensions of the certification date and the employer assessment 
duty), so the final part of this PEA compares the yearly assessment and 
certification costs employers will incur under the two scenarios. 
Because the assessment and certification costs change across years 
under each scenario, OSHA must compare the cost differential in each 
year separately to determine the annual cost savings for each year 
attributable to scenario 2. OSHA calculated the present value of each 
year's differential, which provides a consistent basis for comparing 
the cost differentials over the extended compliance period. OSHA then 
annualized the present value of each differential to identify an annual 
amount that accounts for the discounted costs over this period. Table 1 
below summarizes these calculations.
    Table 1 shows that assessment and certification costs are just 
shifted out another year. As noted earlier, OSHA estimated the overall 
cost differential between these two scenarios by calculating the 
difference in total (assessment and certification) costs each year 
across the two scenarios. The net employer cost savings in current 
dollars attributable to adopting the second scenario are, for each 
certification year: 2017, $18.2 million; 2018, $8.7 million; 2019-2021, 
$0; 2022, -$7.5 million.\12\
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    \12\ A positive cost differential indicates cost savings and a 
negative cost differential indicates net costs. Savings in the first 
two years is due to the lower cost of assessments versus 
certification. Then net costs in year 2022 are due to the last year 
of annualized certification costs for scenario 2, while this cost 
ends in year 2021 for scenario 1.

                                Table 1--Year-by-Year Cost Differential if OSHA Delays the Certification Deadline to 2018
--------------------------------------------------------------------------------------------------------------------------------------------------------
                  Certification year                           2017               2018           2019        2020        2021        2022        2023
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                      Operator Pool
--------------------------------------------------------------------------------------------------------------------------------------------------------
Scenario 1 (No Deadline Extension)
    Operators with Non-Compliant Certification........             71,700                  0           0           0           0           0           0
    Operators with Compliant Certification............             15,000            111,274     111,274     111,274     111,274     111,274     111,274
    Operators with No Certification...................             24,574                  0           0           0           0           0           0
    New Operators.....................................              5,857              5,857       5,857       5,857       5,857       5,857       5,857
Scenario 2 (Deadline Extension)
    Operators with Non-Compliant Certification........             71,700             71,700           0           0           0           0           0
    Operators with Compliant Certification............             15,000             15,000     111,274     111,274     111,274     111,274     111,274
    Operators with No Certification...................             24,574             24,574           0           0           0           0           0
    New Operators.....................................              5,857              5,857       5,857       5,857       5,857       5,857       5,857
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                          Costs
--------------------------------------------------------------------------------------------------------------------------------------------------------
Scenario 1 (No Deadline Extension)
    Total Assessment Costs............................          4,540,348                  0           0           0           0           0           0
    Total Certification Costs.........................         20,362,269         33,645,533  33,645,533  33,645,533  33,645,533  26,082,317  26,082,317
                                                       -------------------------------------------------------------------------------------------------
        Total Costs...................................         24,902,617         33,645,533  33,645,533  33,645,533  33,645,533  26,082,317  26,082,317
--------------------------------------------------------------------------------------------------------------------------------------------------------
Scenario 2 (Deadline Extension)
    Total Assessment Costs............................          6,624,861          4,540,348           0           0           0           0           0
    Total Certification Costs.........................                  0         20,362,269  33,645,533  33,645,533  33,645,533  33,645,533  26,082,317
                                                       -------------------------------------------------------------------------------------------------
        Total Costs...................................          6,624,861         24,902,617  33,645,533  33,645,533  33,645,533  33,645,533  26,082,317
                                                       -------------------------------------------------------------------------------------------------
            Cost Differential (Scenario 2-Scenario 1).       (18,277,756)        (8,742,916)  ..........  ..........  ..........   7,563,216  ..........
--------------------------------------------------------------------------------------------------------------------------------------------------------
Source: OSHA, ORA Calculations.

    OSHA next determined the present value of these cost differentials 
between the two scenarios. OSHA calculated the present value of future 
costs using two interest rates assumptions, 3 percent and 7 percent, 
which follow the OMB guidelines specified by Circular A-4. At an 
interest rate of 3 percent, the present value of the cost differentials 
for CY 2017 onwards results in an estimated savings of $20.2 million 
($21.3 million using the 7 percent rate). Finally, annualizing the 
present value over five years results in an annualized cost 
differential (i.e., net employer cost savings) of $4.4 million per year 
($5.2 million per year using the 7 percent rate).
    As a sensitivity analysis the Agency looked at including possible 
overhead costs. It is important to note that there is not one broadly 
accepted overhead rate and that the use of overhead to estimate the 
marginal costs of labor raises a number of issues that should be 
addressed before applying overhead costs to analyze the costs of any 
specific regulation. There are several approaches to look at the cost 
elements that fit the definition of overhead and there are a

[[Page 51996]]

range of overhead estimates currently used within the Federal 
government--for example, the Environmental Protection Agency has used 
17 percent,\13\ and government contractors have been reported to use an 
average of 77 percent.14 15 Some overhead costs, such as 
advertising and marketing, vary with output rather than with labor 
costs. Other overhead costs vary with the number of new employees. For 
example, rent or payroll processing costs may change little with the 
addition of 1 employee in a 500-employee firm, but those costs may 
change substantially with the addition of 100 employees. If an employer 
is able to rearrange current employees' duties to implement a rule, 
then the marginal share of overhead costs such as rent, insurance, and 
major office equipment (e.g., computers, printers, copiers) would be 
very difficult to measure with accuracy (e.g., computer use costs 
associated with 2 hours for rule familiarization by an existing 
employee).
---------------------------------------------------------------------------

    \13\ U.S. Environmental Protection Agency, ``Wage Rates for 
Economic Analyses of the Toxics Release Inventory Program,'' June 
10, 2002.
    \14\ Grant Thornton LLP, 2015 Government Contractor Survey. 
(https://www.grantthornton.com/~/media/content-page-files/public-
sector/pdfs/surveys/2015/Gov-Contractor-Survey.ashx).
    \15\ For a further example of overhead cost estimates, please 
see the Employee Benefits Security Administration's guidance at 
https://www.dol.gov/sites/default/files/ebsa/laws-and-regulations/rules-and-regulations/technical-appendices/labor-cost-inputs-used-in-ebsa-opr-ria-and-pra-burden-calculations-august-2016.pdf.
---------------------------------------------------------------------------

    If OSHA had included an overhead rate when estimating the marginal 
cost of labor, without further analyzing an appropriate quantitative 
adjustment, and adopted for these purposes an overhead rate of 17 
percent on base wages, as was done in a sensitivity analysis in the FEA 
in support of OSHA's 2016 final rule on Occupational Exposure to 
Respirable Crystalline Silica, the overhead costs would increase cost 
savings from $4.4 million to $4.5 million at a discount rate of 3 
percent, an increase of 1.8 percent, and would increase cost savings 
from $5.2 million to $5.3 million at a discount rate of 7 percent, an 
increase of 1.9 percent.
d. Certification of No Significant Impact on a Substantial Number of 
Small Entities
    Most employers will have savings resulting from the one-year 
extension, particularly employers that planned to pay for operator 
certification in the year before the existing 2017 deadline. The only 
entities likely to see a net cost will be entities that planned to hire 
an operator with compliant certification after November 10, 2017. 
Without the one-year extension, these entities will have no separate 
assessment duty, but under the one-year extension they will have the 
expense involved in assessing operator competency. As noted above, 
however, OSHA estimated the maximum cost for such an assessment (for 
operators with no certification) to be $317.08 per certified operator.
    Small businesses will, by definition, have few operators, and OSHA 
believes the $317.08 cost will be well below 1 percent of revenues, and 
well below 5 percent of profits, in any industry sector using cranes. 
OSHA does not consider such small amounts to represent a significant 
impact on small businesses in any industry sector. Hence, OSHA 
certifies this final rule will not have a significant impact on a 
substantial number of small entities. After providing relatively 
similar estimates in the 2014 FEA, OSHA made the same certification in 
the 2014 FEA and proposed the same certification in the 2017 PEA but 
did not receive any adverse comment on either the certification or its 
underlying rationale.

B. Paperwork Reduction Act

    The Paperwork Reduction Act (PRA) requires Federal agencies to 
obtain the Office of Management and Budget (OMB) approval of 
information collection requirements before an Agency can conduct or 
sponsor the information collection requirement; and to display the OMB 
control (approval number) (44 U.S.C. 3507(d)). Agencies submit an 
Information Collection Request (ICR), with paperwork analysis, to OMB 
seeking approval of their paperwork requirements. The information 
collection requirements in the Cranes and Derricks in Construction 
Standard (29 CFR part 1926, subpart CC) have been approved by OMB in 
the ICR titled Cranes and Derricks in Construction Standard (29 CFR 
part 1926, subpart CC), under OMB control Number 1218-0261. These 
paperwork requirements expire on February 28, 2020.
    In the August 30, 2017 NPRM, OSHA notified the public that the 
Agency believed the proposed Cranes and Derricks in Construction: 
Operator Certification Extension rule did not contain additional 
collection of information, and that OSHA did not believe it was 
necessary to submit a new (revised) ICR to OMB. OSHA instructed the 
public to submit comments on this determination to OMB and encouraged 
them to submit their comments to OSHA. No comments were received and 
OSHA has determined this final rule requires no additional collection 
of information or any permanent change to the collection program. As a 
result, the Agency did not submit an ICR to OMB.
    The Agency notes that a Federal agency generally cannot conduct or 
sponsor a collection of information, and the public is generally not 
required to respond to an information collection, unless it is approved 
by OMB under the PRA and displays a currently valid OMB Control Number. 
In addition, notwithstanding any other law, no person may generally be 
subject to penalty for failing to comply with a collection of 
information that does not display a valid Control Number.\16\
---------------------------------------------------------------------------

    \16\ See 5 CFR 1320.5(a) and 1320.6.
---------------------------------------------------------------------------

C. Federalism

    OSHA reviewed this final rule in accordance with the Executive 
Order on Federalism (Executive Order 13132, 64 FR 43255, August 10, 
1999), which requires that Federal agencies, to the extent possible, 
refrain from limiting State policy options, consult with States prior 
to taking any actions that would restrict State policy options, and 
take such actions only when clear constitutional authority exists and 
the problem is national in scope. Executive Order 13132 provides for 
preemption of State law only with the expressed consent of Congress. 
Federal agencies must limit any such preemption to the extent possible.
    Under Section 18 of the Occupational Safety and Health Act of 1970 
(OSH Act; 29 U.S.C. 651 et seq.), Congress expressly provides that 
States and U.S. territories may adopt, with Federal approval, a plan 
for the development and enforcement of occupational safety and health 
standards. OSHA refers to such States and territories as ``State Plan 
States.'' Occupational safety and health standards developed by State 
Plan States must be at least as effective in providing safe and 
healthful employment and places of employment as the Federal standards. 
29 U.S.C. 667. Subject to these requirements, State Plan States are 
free to develop and enforce under State law their own requirements for 
safety and health standards.
    OSHA previously concluded from its analysis that promulgation of 
subpart CC complies with Executive Order 13132 (75 FR 48128-29). In 
States without an OSHA-approved State Plan, this final rule limits 
State policy options in the same manner as every standard promulgated 
by OSHA. For State Plan States, Section 18 of the OSH Act, as noted in 
the previous paragraph, permits State-Plan States to develop and 
enforce their own crane standards

[[Page 51997]]

provided these requirements are at least as effective in providing safe 
and healthful employment and places of employment as the requirements 
specified in this final rule.

D. State Plans

    When Federal OSHA promulgates a new standard or more stringent 
amendment to an existing standard, State Plans must either amend their 
standards to be ``at least as effective as'' the new standard or 
amendment, or show that an existing State standard covering this area 
is already ``at least as effective'' as the new Federal standard or 
amendment (29 CFR 1953.5(a)). State Plans adoption must be completed 
within six months of the promulgation date of the final Federal rule. 
When OSHA promulgates a new standard or amendment that does not impose 
additional or more stringent requirements than an existing standard, 
State Plans do not have to amend their standards, although OSHA may 
encourage them to do so.
    The amendment to OSHA's crane standard in this final rule only 
delays the deadline for operator certification requirements and does 
not impose any new requirements on employers. Accordingly, State Plans 
are not required to amend their standards to delay the deadline for 
their operator certification requirements, but they may do so if they 
so choose. If they choose to delay the deadline for their certification 
requirements, they also would need to include a corresponding extension 
of the employer duty to assess and train operators that is equivalent 
to Sec.  1926.1427(k)(2).

E. Unfunded Mandates Reform Act

    When OSHA issued the final rule for cranes and derricks in 
construction, it reviewed the rule according to the Unfunded Mandates 
Reform Act of 1995 (UMRA; 2 U.S.C. 1501 et seq.) and Executive Order 
13132 (64 FR 43255 (Aug. 10, 1999)). OSHA concluded that the final rule 
did not meet the definition of a ``Federal intergovernmental mandate'' 
under the UMRA because OSHA standards do not apply to State or local 
governments except in States that voluntarily adopt State Plans. OSHA 
further noted that the rule imposed costs of over $100 million per year 
on the private sector and; therefore, required review under the UMRA 
for those costs, but that its final economic analysis met that 
requirement.
    As discussed above in Section III.A (Final Economic Analysis and 
Regulatory Flexibility Analysis) of this preamble, this final rule does 
not impose any costs on private-sector employers beyond those costs 
already taken into account in the 2010 final rule for cranes and 
derricks in construction. Because OSHA reviewed the total costs of the 
2010 final rule under the UMRA, no further review of those costs is 
necessary. Therefore, for the purposes of the UMRA, OSHA certifies that 
this final rule does not mandate that State, local, or tribal 
governments adopt new, unfunded regulatory obligations, or increase 
expenditures by the private sector of more than $100 million in any 
year.

F. Consultation and Coordination With Indian Tribal Governments

    OSHA reviewed this final rule in accordance with Executive Order 
13175 (65 FR 67249) and determined that it does not have ``tribal 
implications'' as defined in that order. The rule does not have 
substantial direct effects on one or more Indian tribes, on the 
relationship between the Federal government and Indian tribes, or on 
the distribution of power and responsibilities between the Federal 
government and Indian tribes.

G. Executive Order 13771: Reducing Regulation and Controlling 
Regulatory Costs

    Consistent with E.O. 13771 (82 FR 9339, February 3, 2017), OSHA has 
estimated the annualized cost savings over 10 years for this final rule 
to range from $4.4 million to $5.2 million, depending on the discount 
rate. This final rule is considered an E.O. 13771 deregulatory action. 
Details on the estimated cost savings of this final rule can be found 
in the rule's economic analysis.

H. Legal Considerations

    The purpose of the Occupational Safety and Health Act of 1970 (29 
U.S.C. 651 et seq.) is ``to assure so far as possible every working man 
and woman in the nation safe and healthful working conditions and to 
preserve our human resources.'' 29 U.S.C. 651(b). To achieve this goal, 
Congress authorized the Secretary of Labor to promulgate and enforce 
occupational safety and health standards. 29 U.S.C. 654(b), 655(b). A 
safety or health standard is a standard ``which requires conditions, or 
the adoption or use of one or more practices, means, methods, 
operations, or processes, reasonably necessary or appropriate to 
provide safe or healthful employment or places of employment.'' 29 
U.S.C. 652(8). A standard is reasonably necessary or appropriate within 
the meaning of Section 652(8) when a significant risk of material harm 
exists in the workplace and the standard would substantially reduce or 
eliminate that workplace risk. See Industrial Union Department, AFL-CIO 
v. American Petroleum Institute, 448 U.S. 607 (1980). In the cranes 
rulemaking, OSHA made such a determination with respect to the use of 
cranes and derricks in construction (75 FR 47913, 47920-21). This final 
rule does not impose any new requirements on employers. Therefore, this 
final rule does not require an additional significant risk finding (see 
Edison Electric Institute v. OSHA, 849 F.2d 611, 620 (D.C. Cir. 1988)).
    In addition to materially reducing a significant risk, a safety 
standard must be technologically feasible. See UAW v. OSHA, 37 F.3d 
665, 668 (D.C. Cir. 1994). A standard is technologically feasible when 
the protective measures it requires already exist, when available 
technology can bring the protective measures into existence, or when 
that technology is reasonably likely to develop (see American Textile 
Mfrs. Institute v. OSHA, 452 U.S. 490, 513 (1981); American Iron and 
Steel Institute v. OSHA, 939 F.2d 975, 980 (D.C. Cir. 1991)). In the 
2010 Final Economic Analysis for the crane standard, OSHA found the 
standard to be technologically feasible (75 FR 48079). Therefore, this 
final rule is technologically feasible as well because it does not 
require employers to implement any additional protective measures; it 
simply extends the duration of existing requirements.

List of Subjects in 29 CFR Part 1926

    Construction industry, Cranes, Derricks, Occupational safety and 
health, Safety.

    Signed at Washington, DC, on November 3, 2017.
Loren Sweatt,
Deputy Assistant Secretary of Labor for Occupational Safety and Health.

Amendments to Standards

    For the reasons stated in the preamble of this final rule, OSHA 
amends 29 CFR part 1926 as follows:

PART 1926--[AMENDED]

Subpart CC--Cranes and Derricks in Construction

0
1. The authority citation for subpart CC of 29 CFR part 1926 continues 
to read as follows:

    Authority: 40 U.S.C. 3701 et seq.; 29 U.S.C. 653, 655, 657; and 
Secretary of Labor's Orders 5-2007 (72 FR 31159) or 1-2012 (77 FR 
3912), as applicable; and 29 CFR part 1911.


0
2. Revise Sec.  1926.1427(k) to read as follows:

[[Page 51998]]

Sec.  1926.1427  Operator qualification and certification.

* * * * *
    (k) Phase-in. (1) The provisions of this section became applicable 
on November 8, 2010, except for paragraphs (a)(2) and (f) of this 
section, which are applicable November 10, 2018.
    (2) When paragraph (a)(1) of this section is not applicable, all of 
the requirements in paragraphs (k)(2)(i) and (ii) of this section apply 
until November 10, 2018.
    (i) The employer must ensure that operators of equipment covered by 
this standard are competent to operate the equipment safely.
    (ii) When an employee assigned to operate machinery does not have 
the required knowledge or ability to operate the equipment safely, the 
employer must train that employee prior to operating the equipment. The 
employer must ensure that each operator is evaluated to confirm that 
he/she understands the information provided in the training.

[FR Doc. 2017-24349 Filed 11-8-17; 8:45 am]
 BILLING CODE 4510-26-P