Concrete Masonry Products Research, Education and Promotion Order
| Published date | 24 August 2020 |
| Citation | 85 FR 52059 |
| Record Number | 2020-17515 |
| Section | Proposed rules |
| Court | The Under-secretary For Economic Affairs Office |
Federal Register, Volume 85 Issue 164 (Monday, August 24, 2020)
[Federal Register Volume 85, Number 164 (Monday, August 24, 2020)]
[Proposed Rules]
[Pages 52059-52077]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-17515]
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DEPARTMENT OF COMMERCE
Office of the Under-Secretary for Economic Affairs
15 CFR Chapter XV
[Docket No.: 200803-0204]
RIN 0605-AA53
Concrete Masonry Products Research, Education and Promotion Order
AGENCY: Under Secretary for Economic Affairs, United States Department
of Commerce.
ACTION: Notice of proposed rulemaking.
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SUMMARY: The Department of Commerce (Department) solicits comments on a
proposed Concrete Masonry Products Research, Education, and Promotion
Order. The purpose of the proposed order is to strengthen the position
of the concrete masonry products industry in the domestic marketplace;
maintain, develop, and expand markets and uses of concrete masonry
products in the domestic marketplace; and promote the use of concrete
masonry products in construction and building. The proposed order
allows a Concrete Masonry Products Board (Board) made up of industry
members appointed by the Secretary of Commerce (Secretary) to develop
and implement programs of research, education, and promotion. The
funding of the Board's activities and programs will be through
assessments paid by manufacturers of concrete masonry units. The
initial assessment will be $.01 per concrete masonry unit sold. The
Secretary will hold a referendum among eligible manufacturers to
determine whether they favor the implementation of the proposed order.
The order only will go into effect if the referendum results in the
affirmative vote of a majority of those voting and also a majority of
the block machine cavities in operation by those voting. This proposal
also announces the intent of the Department to request approval by the
Office of Management and Budget (OMB) of a new information collection
request (ICR) to support implementation of the program.
DATES: The Department must receive comments by October 8, 2020.
ADDRESSES: Submit all electronic public comments via the Federal e-
Rulemaking Portal. Go to https://www.regulations.gov/docket?D=DOC-2020-0002, click the ``Comment Now!'' icon, complete the required fields,
and enter or attach your comments. The supporting economic analysis is
also available for comment on regulations.gov.
You may also submit comments via email at [email protected]. All
submissions, including attachments and other supporting materials, will
become part of the public record and subject to public disclosure. The
Department reserves the right to publish relevant comments, unedited
and in their entirety. Do not include personal information, such as
account numbers or Social Security numbers, or names of other
individuals. Do not submit confidential business information, or
otherwise proprietary, sensitive or protected information. We will not
post or consider comments that contain profanity, vulgarity, threats,
or other inappropriate language or like content.
Pursuant to the Paperwork Reduction Act (PRA), send to the above
address comments regarding the accuracy of the burden estimate, ways to
minimize the burden, including the use of automated collection
techniques or other forms of information technology, or any other
aspect of this collection of information. In addition, send comments
concerning the information collection to [email protected] or
online at https://www.reginfo.gov/public/do/PRAMain.
FOR FURTHER INFORMATION CONTACT: Mr. Michael Thompson, Communications
for the Commerce Checkoff Implementation Program, Office of the Under
Secretary for Economic Affairs, telephone: (202) 482-0671 or via
electronic mail: [email protected].
SUPPLEMENTARY INFORMATION:
I. Overview
Pursuant to the Concrete Masonry Products Research, Education, and
Promotion Act of 2018 (Act), 15 U.S.C. 8701 et seq., the Department is
enacting a research, education, and promotion program (commonly
referred to as a checkoff program) for concrete masonry products. The
Act specifically authorizes the Secretary to ``issue such regulations
as may be necessary to carry out [the Act] and the power vested in the
Secretary under [the Act].'' 15 U.S.C. 8713.
The Department's actions to bring the program to fruition will
include: (1) Implementing an order that will effectuate the purpose of
the Act; (2) conducting a referendum among the industry to determine
whether the industry approves of being subject to the implementing
order; and, upon an affirmative vote on the order; (3) issuing the
order and establishing a Board that will carry out the provisions of
the
[[Page 52060]]
order; and (4) performing continuing oversight of the Board and
program.
This notice is the first step in enacting the concrete checkoff
program by proposing an order that would implement the Act. The stated
purpose of the proposed order is to strengthen the position of the
concrete masonry products industry in the domestic marketplace;
maintain, develop, and expand markets and uses for concrete masonry
products in the domestic marketplace; and promote the use of concrete
masonry products in construction and building. The order would empower
the Board to develop and carry out research, education, and promotion
programs and projects relating to concrete masonry products and paying
the costs of such programs and projects with assessments on domestic
producers of concrete masonry units.
Following a period of public comment, the Department will address
or incorporate those comments received and initiate a referendum on the
final order. If the manufacturers of concrete masonry units, via a
referendum, approve the implementing order, the Secretary will appoint
a Board to carry out the duties as the order prescribes, including the
receiving of the assessment. Under the proposed order, the Secretary
would establish a Board that ensures fair and equitable representation
of the concrete masonry products industry, specifically the
geographical distribution of the manufacture of concrete masonry
products in the United States, the types of concrete masonry products
manufactured, and the range in size of manufacturers in the United
States. An industrywide assessment of $.01 per concrete masonry unit
sold would finance the research, education, and promotion initiatives
of the checkoff program. The Secretary would oversee the operations and
actions of the Board.
The Act requires the order to address, among other items,
establishment and membership of the Board, balancing guidance for
appointments, a nomination process, the selection of alternates, Board
terms, powers and duties of the Board, programs and projects to carry
out the purpose of the Act, budgets, expenses, contracts and
agreements, books and records, and reporting requirements.
The Act provides the rate of assessment and that such assessments
shall be paid by a manufacturer that has manufactured concrete masonry
products during a period of at least 180 days prior to the date they
are to pay the assessment. The initial rate of assessment is $.01 per
concrete masonry unit sold. Such manufacturers will submit their
assessments to the Board quarterly. The Act allows for a change in rate
if a two-thirds majority of voting members of the Board so vote. An
increase or decrease can occur only once per year and the change in
rate may not exceed $.01 per concrete masonry unit sold. Finally, the
assessment rate shall not be in excess of $.05 per concrete masonry
unit.
The Act provides that not less than 50 percent of assessments (less
administration expenses) paid by a manufacturer shall be used to
support research, education, and promotion programs and projects in
support of the Geographic Region of the contributing manufacturer. The
Act defines five Geographic Regions that generally reflect the
northeast, southeast, middle, southwest, and northwest (plus Hawaii and
Alaska) of the United States. The Board will work with regional
concrete industry groups to allocate funding and coordinate programs
that have national and regional impact.
Programs for research, promotion and education will further the
following goals:
Strengthen the position of the concrete masonry industry
and products domestically.
Maintain, develop, and expand markets and uses for
concrete masonry domestically.
Promote the use of concrete masonry in construction and
building.
The Act mandates that the Department conduct a referendum among
eligible manufacturers of concrete masonry products to determine
whether the manufacturers favor implementation of the concrete checkoff
program prior to it going into effect. For the order to go into effect,
there must be a majority ``yes'' vote by both: (1) The total number of
concrete masonry unit manufacturers voting; and (2) manufacturers who
operate a majority of the machine cavities operated by the
manufacturers voting in the referendum. Proposed procedures for
conducting the referendum will be published in a separate notice in the
Federal Register.
With this notice, the Secretary invites comments on the proposed
order.
II. Legal Authority and Framework for the Secretary's Implementation of
an Effectuating Order
The Act provides that the Secretary, subject to applicable
procedures, shall issue orders, national in scope, applicable to
concrete masonry products manufactured in the U.S. 15 U.S.C. 8713; see
also 15 U.S.C. 8702(12,19). If the Secretary determines that a proposed
order received, requested by or submitted to the Secretary, is
consistent with and will effectuate the purpose of the Act, the
Secretary shall publish such proposed order in the Federal Register not
later than 90 days after receiving the order, and give not less than 30
days notice and opportunity for public comment on the proposed order.
An industry group, the CMU Checkoff Initiative, submitted the proposed
order to the Secretary on April 15, 2020. The Secretary has determined
that the proposed order is consistent with and will effectuate the
purpose of the Act. The determination that the proposed order is
consistent with and will effectuate the purpose of the Act was made on
July 20, 2020.
Pursuant to the Act, the Secretary must establish a process for the
Board to carry out a program of generic promotion, research, and
education regarding concrete masonry products by implementing an
effectuating order. 15 U.S.C. 8704(b). In addition, 15 U.S.C. 8706
provides for referenda among eligible manufacturers subject to
assessments under section 8705 of the Act to determine whether the
order has been approved and will go into effect. As noted above, the
proposed procedures for the referendum will be published in a separate
Federal Register notice.
III. Industry Background
While the concrete masonry product industry is of moderate size,
its manufacturers populate every state in the nation as well as the
District of Columbia. The nature of the industry and cost of
transportation of the products is such that the customer base for
concrete masonry products is very localized. Relatively small producers
dominate the industry. Because they produce a commodity that is not
easily differentiated by manufacturer, most of the producers acting
alone do not have the resources to efficiently market the value of the
product or conduct the research and education to promote market growth.
Coordinated activity would enable producers to leverage economies of
scale in conducting research, education, and promotion of the industry.
Concrete masonry products range from the paver that is of original
design and very ornate to the homogenous, non-descript 8-inch x 8-inch
x 16-inch concrete block. The Act and the proposed order distinguish
between concrete masonry products and concrete masonry units; the
initial rate of assessment applies only to concrete masonry units. The
Act defines concrete masonry products to include a broader category of
products, including concrete
[[Page 52061]]
masonry units as well as hardscape products such as concrete pavers and
segmental retaining wall units, manufactured on a block machine using
dry-cast concrete. Concrete masonry units are a type of concrete
masonry product with an actual width of 3 inches or greater that are
manufactured from dry-cast concrete using a block machine, including
concrete block and related concrete units used in masonry applications.
The following are examples of products that would fall within the
definition of a concrete masonry unit (defined in Sec. 1500.6). The
following non-exhaustive list of products are included in the
definition of a concrete masonry unit:
(A) Concrete Block, including:
(11) Gray
(2) Architectural
(3) Prefaced
(4) Those joined by any method in masonry construction:
(i) Bed joint mortar or adhesives
(ii) Dry-stacked and joined by filling cores solid with grout or
joined by other means
(iii) Post tensioned
(iv) Surfaced bonded
(5) Sound wall block
(6) Fence block
(7) Lintel Block--while lintels designed to span an entire opening
are excluded, those concrete masonry units joined to create a lintel
are included
(8) Chimney, Pilaster, or Column Block
(9) Screen Block--these architectural units are included if their
widths are greater than 3 inches if they are made on a block machine
(10) Concrete Sill Block--these units and related specialty units
are included if their widths are greater than 3 inches. If they are
made on a block machine
(11) Concrete Block formed with concrete masonry face shells and
other materials to create a masonry unit used in masonry construction.
(A) Concrete Brick (Architectural only)
(B) Concrete Masonry Veneer Units (greater than 3 inches in width)
The Act sets out the assessment rate of one cent per concrete
masonry unit sold.
To identify the affected industry, the Department used statistics
for the North American Industry Classification System (NAICS) code
327331, concrete block and brick manufacturing. This industry includes
the manufacturers of concrete architectural block, concrete and cinder
blocks, concrete bricks, concrete patio block, concrete paving block,
precast terrazzo plinth blocks, precast concrete block and brick,
prestressed concrete blocks or bricks, and slumped brick.\1\ The
Department believes this NAICS classification most closely corresponds
to manufacturers of the broader category of concrete masonry products.
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\1\ Executive Office of the President, Office of Management and
Budget, North American Industry Classification System: United
States, 2017 (Suitland, MD: Census Bureau, 2017); https://www.census.gov/eos/www/naics/2017NAICS/2017_NAICS_Manual.pdf.
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According to estimates from the 2017 Economic Census of the U.S.
Census Bureau, the block and brick manufacturing industry had nearly
700 establishments and more than 16,000 employees in 2017. From 2007 to
2017, the number of establishments, number of employees, annual
payroll, value added, and value of shipments declined in the
industry.\2\ There were 690 block and brick manufacturing
establishments in 2017, down from 914 in 2007. The number of employees
fell by 7,578 to 16,247 in 2017, and annual payroll fell $152 million
to $841 million. Value added and total value of shipments also fell
during this time period, down $715 million to $2.86 billion and down
$1.36 billion to $4.88 billion, respectively.
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\2\ The Economic Census, conducted every 5 years by the U.S.
Census Bureau, is the official measure of the nation's businesses
and economy.
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IV. Provisions of the Proposed Order
Many provisions of the proposed order reflect specific requirements
as set out in the Act. In instances where the Secretary is exercising
the discretion granted under the Act, the basis for the proposed
language is explained below.
Definitions
Sections 1500.1 through 1500.21 of the proposed order are
definitions. Section 1500.1 defines the ``Act'' as the Concrete Masonry
Products Research, Education, and Promotion Act of 2018 (15 U.S.C. 8701
et seq.), and any amendments thereto. The other definitions contained
in the proposed order are essentially the same as the definitions found
in the Act itself, see 15 U.S.C. 8702, except for the addition of a
definition of ``Geographic Regions'' in Sec. 1500.11.
Section 1500.11 defines ``Geographic Regions'' as the groupings of
states delineated in Sec. 1500.40(c) of the proposed order, for the
purpose of supporting research, education, and promotion plans and
project. See 15 U.S.C. 8705(f). Specifically, in addition to size and
range of products, the Act requires that the Board reflect the
geographic distribution, the five delineated regions, of the
manufacture of concrete masonry products. 15 U.S.C. 8704(b)(2)(A). The
Act also provides that not less than 50 percent of assessments (less
administrative expenses) paid by a manufacturer shall be used to
support research, education, and promotion programs and projects in
support of the geographic region of the manufacturer. 15 U.S.C.
8705(f)(1).
Concrete Masonry Products Board
Sections 1500.40 through 1500.48 of the proposed order would
establish the Board and how it would operate.
Section 1500.40--Establishment and Membership
Section 1500.40(a) proposes that the Board would consist of not
fewer than 15 and not more than 25 members. The Board shall consist of
manufacturers. 15 U.S.C. 8704(b)(1)(B)(i) & (iii). Board members will
be appointed by the Secretary from nominations submitted as set forth
in Sec. 1500.41 of the proposed order. See 15 U.S.C.
8704(b)(1)(B)(ii). This subsection also implements provisions of the
Act that specify no employee of an industry trade organization exempt
from tax under paragraph (3) or (6) of section 501(c) of the Internal
Revenue Code of 1986 representing the concrete masonry industry or
related industries shall serve as a member of the Board and no member
of the Board may serve concurrently as an officer of the board of
directors of a national concrete masonry products industry trade
association. 15 U.S.C. 8704(b)(1)(B)(iii).
Section 1500.40(b) proposes that, in order to ensure to ensure fair
and equitable representation of the concrete masonry products industry,
the composition of the Board shall reflect the geographical
distribution of the manufacture of concrete masonry products in the
United States, the types of concrete masonry products manufactured, and
the range in size of manufacturers in the United States. These
requirements are taken directly from the Act. 15 U.S.C. 8704(b)(2)(A).
The Small Business Administration uses the number of employees to
characterize a company's size. Absent additional suggestions, the
Department will define company size based on the number of employees.
Companies identified as ``large'' will be those with over 500
employees; companies identified as ``medium'' will be those with
between 100-499 employees; companies identified as small will be those
with less than 100 employeess. The Department is seeking comments on
the best measure of company size (other possiblilities, aside from
number of employees, could be production
[[Page 52062]]
capacity, total receipts, number of units producted) and the threshold
values to use. Further, this subsection proposes that no company or its
affiliates shall have more than two members on the Board. See 15 U.S.C.
8704(b)(1)(B)(iii).
Section 1500.40(c) of the proposed order would further implement
the requirement that the composition of the Board reflect the
geographical distribution of concrete masonry product manufacturers. It
divides the United States into five regions consistent with 15 U.S.C
8705(f)(2) and, although not required in the Act, the order then
subdivides these five regions into 15 districts. Dividing the regions
into districts will allow the Board to more easily manage the program.
This section also proposes that the Secretary will, to the extent
possible and depending on the nominees submitted, strive to appoint at
least two members from each region and at least one from each district.
Finally, Sec. 1500.40(d) proposes that, in accordance with 15 U.S.C.
8704(b)(2)(B), the Board shall, if warranted, recommend reapportionment
of Board membership every three years, in order to reflect changes in
the geographic distribution of the manufacture of concrete masonry
products and the types of concrete masonry products manufactured.
Section 1500.41--Nominations and Appointments
The Act does not specifically describe how nominations and
appointments to the Board should be made, but simply states that the
Secretary may make appointments from nominations by manufacturers
pursuant to the method set forth in the order. 15 U.S.C. 8704(b)(3).
Similarly, the Act states that the order shall provide for the
selection of alternate members by the Secretary. See 15 U.S.C.
8704(b)(3). At such time as the order goes into effect, the Secretary
will solicit nominations for Board membership. Section 1500.41(a)
proposes that, for the initial Board, nominations shall be made and
submitted to the Secretary by manufacturers. The Secretary would
appoint both members and alternate members of the Board. This
requirement is the source of the Department's request for approval by
OMB of a new ICR. The Department would restrict the information request
to that information needed to determine requisite expertise of
potential nominees and will include biography, experience, status as a
current manufacturer, size of company, type of products produced,
statement of interest, and similar background information.
The Act provides that, if the Secretary fails to make an
appointment to the Board within 60 days of receiving nominations for an
appointment, subject to exceptions, the first nominee would be
``deemed'' appointed. 15 U.S.C. 8704(b)(4). However, the President
issued a signing statement accompanying the Act as follows:
. . . [T]he Act requires the Secretary of Commerce to appoint the
members of the Concrete Masonry Products Board (Board), who would be
inferior officers, from a list of nominees submitted by concrete
masonry product manufacturers. It also provides that, if the
Secretary fails to appoint someone from that list within a specified
period, ``the first nominee for such appointment shall be deemed
appointed.'' The Secretary's failure to make a timely appointment
from the list will result in the appointment of an inferior officer
by a private party, which would violate the Appointments Clause.
Furthermore, the requirement to appoint from a list of nominees, if
the list is too limited, may unduly limit the Secretary's
constitutional discretion in appointing the members of the Board. In
those circumstances, my Administration will treat these requirements
as advisory and non-binding.\3\
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\3\ Statement by the President, Oct. 5, 2018, available at
https://www.whitehouse.gov/briefings-statements/statement-by-the-president-5/.
Hence, the Department will not include in the order those
provisions of the Act that are inconsistent with the Presidential
signing statement including those related to ``deemed'' appointment of
members and those that may unduly limit the Secretary's discretion in
making appointments.
Section 1501.41(b) proposes that, from the nominations, the
Secretary will appoint the 15-25 members of the Board and six alternate
members within a reasonable time. If one of the voting members vacates
the appointment, the Secretary will appoint one of the alternate
members to fill the unexpired term. The Secretary will provide the
Board an opportunity to offer a nominee as successor to fill the term
of the alternate member. If the Board fails to submit a nominee for an
open position, the Secretary will appoint a member who meets the
criteria described in Sec. 1500.40.
Section 1500.42--Term of Office
This section proposes that Board members and alternates would serve
three-year terms, except for the initial members. See 15 U.S.C.
8704(b)(6)(A). Board members and alternates would be able to serve a
maximum of two consecutive three-year terms, but may serve additional
terms after rotating off the Board. See 15 U.S.C. 8704(b)(6)(B).
Initial members would serve staggered terms of two, three, and four
years. See 15 U.S.C. 8704(b)(6)(A). Terms would end on December 31,
with new terms beginning on January 1. Members serving an initial term
of two or three years will be eligible to serve a second consecutive
three-year term. Board members and alternates may also continue to
serve until a successor is appointed by the Secretary. See 15 U.S.C.
8704(b)(6)(C).
Section 1500.43--Vacancies
This section proposes that, if a Board member position becomes
vacant, the Secretary would appoint an alternate for the remainder of
the term. The successor to fill the term of the alternate member would
be appointed as described in Sec. 1500.41. See 15 U.S.C.
8704(b)(6)(D).
Section 1500.44--Disqualification
Section 1500.44(a) proposes that, if a Board member or alternate
ceases to qualify as a manufacturer, they would be disqualified from
serving on the Board. See 15 U.S.C. 8704(b)(7). As set forth in the
definitions, a ``manufacturer'' is ``any person engaged in the
manufacturing of commercial concrete masonry products in the U.S.''
Section 1500.44(b) proposes that, if a Board member consistently
refuses to perform their duties, or engages in acts of dishonesty or
willful misconduct, the Board could recommend to the Secretary that the
member be removed. All members would serve at the pleasure of the
Secretary.
Section 1500.45--Procedure
Section 1500.45(a) proposes that the Board would meet at least
annually, and that a meeting would only be conducted when a quorum (a
majority of the Board members) is present. If the Board's by-laws
permit participation by telephone or other means, such participation
would count towards a quorum or other voting requirements.
Section 1500.45(b) proposes that the Board would select a Chair,
Vice-Chair, Secretary-Treasurer and other officers as appropriate, at
the start of each fiscal period.
Section 1500.45(c) proposes that the Board would provide members
and manufacturers a minimum of 14-days advance notice of all Board
meetings.
Section 1500.45(d) proposes that each Board member would be
entitled to one vote, and that a motion would carry if supported by one
vote more than 50 percent of the total votes represented by the Board
members participating. There is one exception, however, as the Act
requires that a two-thirds majority of the voting members of the Board
is required
[[Page 52063]]
to approve a change in the assessment rate. 15 U.S.C. 8705(c)(2)(A).
Section 1500.45(e) proposes that the Board may form committees, and
that such committees may consist of individuals other than Board
members. Committee members would serve without compensation.
Sections 1500.45(f) through (i) address voting, and propose that
votes may take place electronically outside of convened Board meetings
only if members are given 14 days prior notice and if a majority of
voting Board members participate prior to the established deadline;
that all votes shall be recorded in Board minutes; that there shall be
no voting by proxy; and that all Board members shall have one vote.
Alternate members would not vote. The Chair and all other Board
officers would be elected from voting members of the Board.
Section 1500.45(j) proposes that the organization of the Board and
procedures for conducting meetings would be in accordance with bylaws
that are established by the Board and approved by the Secretary.
Section 1500.45(k) proposes that meetings of the Board and
committees may take place by electronic means, provided that all Board
and committee members are given prior written notice 14 days before the
meeting and have the opportunity to participate.
Section 1500.46--Compensation and Reimbursement
This section reflects the requirements in the Act found at 15
U.S.C. 8704(b)(8). Section 1500.46(a) proposes that Board members and
alternates shall serve without compensation. 15 U.S.C. 8704(b)(8)(A).
Section 1500.46(b) proposes that, if approved by the Board, members or
alternates shall be reimbursed for reasonable travel expenses, which
may include a per diem allowance or actual subsistence incurred while
away from their homes or regular place of business in performance of
services for the Board. 15 U.S.C. 8704(b)(8)(B).
Section 1500.47--Powers and Duties
This section largely reflects the provisions contained in 15 U.S.C.
8704(c), which states that the order shall specify the powers and
duties of the Board, and contains a list of powers and duties that
shall be included in the order.
Section 1500.47(a) proposes that the Board shall have the power and
duty to administer the proposed order in accordance with its terms and
conditions, and to collect assessments. See 15 U.S.C. 8704(c)(1).
Section 1500.47(b) proposes that the Board shall have the power and
duty to develop and recommend to the Secretary such bylaws as may be
necessary for the functioning of the Board. See 15 U.S.C. 8704(c)(2).
Section 1500.47(c) provides that the Board shall have the power and
duty to make such rules as may be necessary to administer the order,
including activities to be carried out under the order. See 15 U.S.C.
8704(c)(2).
Section 1500.47(d) proposes that the Board shall have the power and
duty to meet, organize, and select from the Board members a Chair,
Vice-Chair, Secretary-Treasurer and other officers, committees, and
subcommittees, and to vest in such committees and subcommittees such
responsibilities and authorities as the Board determines to be
appropriate. See 15 U.S.C. 8704(c)(3).
Section 1500.47(e) proposes that the Board shall have the power and
duty to establish regional committees to administer regional
initiatives. See 15 U.S.C. 8704(c)(4).
Section 1500.47(f) proposes that the Board shall have the power and
duty to recommend to the Secretary modifications to the Geographic
Regions described in Sec. 1500.11 of the proposed order. See 15 U.S.C.
8705(f)(3).
Section 1500.47(g) proposes that the Board shall have the power and
duty to establish working committees of persons other than Board
members, see 15 U.S.C. 8704(c)(5), and Sec. 1500.47(h) proposes for
the employment of persons other than Board members, as the Board
considers necessary to assist the Board in carrying out its duties, see
15 U.S.C. 8704(c)(6).
Section 1500.47(i) proposes that the Board shall have the power and
duty to prepare a budget and to submit the budget to the Secretary for
approval, see 15 U.S.C. 8704(c)(7), and Sec. 1500.47(j) proposes for
the borrowing of funds necessary for the startup expenses of the
proposed order, see 15 U.S.C. 8704(c)(8).
Section 1500.47(k) proposes that the Board shall have the power and
duty to develop and carry out research, education, and promotion
programs and projects relating to concrete masonry products, and to pay
the costs of such programs and projects with the assessments collected
under Sec. 1500.51, as well as other income of the Board. See 15
U.S.C. 8704(c)(9).
Section 1500.47(l) proposes that the Board shall have the power and
duty to enter into contracts or agreements which must be approved by
the Secretary before becoming effective, for the development and
carrying out of programs or projects of research, education, and
promotion relating to concrete masonry, including with manufacturer
associations or other entities as considered appropriate by the
Secretary. See 15 U.S.C. 8704(c)(10) & (e)(1)(A).
Section 1500.47(m) proposes that the Board shall have the power and
duty to develop programs and projects, and enter into related contracts
or agreements related thereto, which must be approved by the Secretary
before becoming effective, targeted specifically toward the Geographic
Regions described in Sec. 1500.11. Such programs and projects are to
be recommended by the relevant regional committees for marketing and
research projects to benefit manufacturers in their respective
Geographic Regions. The contracts or agreements related to these
regional programs and projects would be subject to the same
requirements for contracts and agreements described above, in Sec.
1500.47(l). See 15 U.S.C. 8704(c)(4) & (e)(1)(A); 15 U.S.C. 8705(f)(1).
The Department envisions regional groupings providing their regional-
specific recommendations for research, education, and promotion
programs and projects to the Board.
Section 1500.47(n) proposes that the Board shall have the power and
duty to keep minutes, books, and records that reflect the actions and
transactions of the Board, and to promptly report the minutes of each
Board meeting to the Secretary. See 15 U.S.C. 8704(c)(11).
Section 1500.47(o) proposes that the Board shall maintain such
records and books, and prepare and submit reports and records to the
Secretary as required; to make records available to the Secretary for
inspection and audit; to account for the receipt and disbursement of
funds; and to keep records that accurately reflect actions and
transactions of the Board. See 15 U.S.C. 8704(f)(1). This requirement
is the source of the Department's second request for approval by OMB of
a new ICR. The Department will restrict the information request to that
information needed to determine the amount of assessment and will
include: the number and type of concrete masonry units manufactured;
the number and type of concrete masonry units on which an assessment
was paid; the name and address of the manufacturer; manufacturer
employee identification number; and the date of assessment payment on
each concrete masonry unit sold; and similar assessment accounting
information.
Section 1500.47(p) proposes that the Board have its books audited
by a certified public accountant at the end of each fiscal year and at
other times as
[[Page 52064]]
requested by the Secretary, and to submit a report of the audit to the
Secretary. See 15 U.S.C. 8704(f)(2).
Section 1500.47(q) proposes that the Board shall have the power and
duty to give the Secretary the same notice of Board and committee
meetings as given to members so that the Secretary's representative(s)
may attend, and report minutes of all such meetings to the Secretary.
See 15 U.S.C. 8704(c)(11) & (15).
Section 1500.47(r) proposes for the Board to furnish any requested
information or records to the Secretary. See 15 U.S.C. 8704(c)(13).
Section 1500.47(s) proposes that the Board shall have the power and
duty to receive, evaluate, and report to the Secretary all complaints
of violations of the proposed order. See 15 U.S.C. 8704(c)(12).
Section 1500.47(t) proposes the Board recommend to the Secretary
amendments to the order as the Board considers appropriate. See 15
U.S.C. 8704(c)(14).
Section 1500.47(u) proposes the Board be allowed to recommend
adjustments to the assessments as provided in the order. See 15 U.S.C.
8704(c)(7) & 15 U.S.C. 8705(c)(2).
Section 1500.47(v) proposes that the Board shall have the power and
duty to notify manufacturers of all Board meetings through press
releases or other means. While the Act does not specifically require
such notice, it will increase transparency of the Board's operations.
Section 1500.47(w) proposes that the Board shall have the power and
duty to invest assessments collected, in accordance with Sec. 1500.50
of the proposed order, and as authorized by 15 U.S.C. 8705(e).
Finally, Sec. 1500.47(x) proposes that the Board shall have the
power and duty to periodically prepare and make available reports of
its activities to the public and to the manufacturers. Additionally, at
least once each fiscal period, the Board would make public an
accounting of funds received and expended. This section helps to
increase transparency of the Board's operations and to implement 15
U.S.C. 8704(j), which requires the Board to prepare and make publicly
available a comprehensive biennial report.
Section 1500.48--Prohibited Activities
Section 1500.48(a) contains a list of prohibited activities that is
identical to the prohibited activities listed in the Act at 15 U.S.C.
8704(g)(1). Specifically, the Board shall not engage in any program or
project to, or use any funds to: (1) Influence legislation, elections,
or governmental action; (2) engage in an action that would be a
conflict of interest; (3) engage in advertising that is false or
misleading; (4) engage in any promotion, research, or education that
would be disparaging to other construction materials; or (5) engage in
any promotion or project that would benefit any individual
manufacturer.
Section 1500.48(b) contains a number of exceptions, which are
identical to those found in the Act at 15 U.S.C. 8704(g)(2). Section
1500.48(a) does not preclude: (1) The development and recommendation of
amendments to the order; (2) communication to appropriate government
officials regarding activities under the order that is not intended to
influence legislation, elections, or governmental action; or (3) any
lawful action designed to market concrete masonry products directly to
a foreign government.
Section 1500.50--Budget and Expenses
Section 1500.50(a) proposes that prior to the beginning of each
fiscal year, and during the fiscal year as may be necessary, the Board
shall prepare and submit to the Secretary for approval a budget for the
upcoming fiscal year covering its anticipated expenses and
disbursements. See 15 U.S.C. 8704(d)(2)(A) & (B). The budget would be
deemed approved if the Secretary fails to approve or reject it within
60 days of receipt, unless the Secretary provides a reasonable
justification for the delay to the Board and Congress, along with a
reasonable date for approval or disapproval. See 15 U.S.C.
8704(d)(2)(C). The Department may provide such justification in any
written format. Each budget shall include: (1) A statement of
objectives and strategy for each program, plan, or project, see 15
U.S.C. 8704(i); (2) a summary of anticipated revenue, with comparative
data for at least one preceding year (except for the initial budget);
(3) a summary of proposed expenditures for each program, plan or
project; and (4) staff and administrative expense breakdowns, with
comparative data for at least one preceding year (except for the
initial budget). See 15 U.S.C. 8704(c)(7) & (d)(2)(A).
Section 1500.50(b) proposes that each budget shall provide adequate
funds to defray its proposed expenditures.
Section 1500.50(c) proposes that, subject to this section, any
amendment or addition to an approved budget must be approved by the
Secretary, including shifting funds from one program or project to
another. However, a de minimis shift of funds from one approved
category to another, and not exceeding 10% of the funds in either
category, which does not cause an increase in the Board's approved
budget and which is consistent with governing bylaws, need not have
prior approval by the Secretary. These provisions provide the Board
with operational flexibility in light of the requirements to submit
budgets to the Secretary for approval contained in 15 U.S.C. 8704(c)(7)
& (d)(2)(A), and are consistent, for example, with the 10% threshold
for certain transfers of fund permitted in the Uniform Administrative
Requirements, Cost Principles, and Audit Requirements for Federal
Awards found at 2 CFR part 200. As noted earlier, the budget will be
deemed approved if the Secretary fails to approve or reject it within
60 days of receipt, unless the Secretary provides a reasonable
justification for the delay to the Board and Congress, along with a
reasonable date for approval or disapproval. See 15 U.S.C.
8704(d)(2)(C). The Department may provide such justification in any
written format.
Section 1500.50(d) proposes that the Board is authorized to incur
such expenses as the Secretary finds are reasonable and likely to be
incurred by the Board for its maintenance and functioning, and to
enable it to exercise its powers and perform its duties in accordance
with the provisions of the order. Such expenses are to be paid from
funds received by the Board. See 15 U.S.C. 8704(d)(3).
Section 1500.50(e) implements the provisions contained in 15 U.S.C.
8715, Limitations on Obligation of Funds. It proposes that:
(1) In each fiscal year, through fiscal year 2030, the Board may
not obligate an amount greater than the sum of--
(a) 73 percent of the amount of assessments estimated to be
collected under 1500.51 in such fiscal year (except for fiscal years
2028 and 2029, for which the amounts estimated to be collected shall be
62 percent of the amount of assessments actually collected in the most
recent fiscal year for which an audit report has been submitted as of
the beginning of the fiscal year for which the amount be obligated is
being determined);
(b) 73 percent of the amount of assessments actually collected
under 1500.51 in the most recent fiscal year for which an audit report
has been submitted as of the beginning of the fiscal year for which the
amount that may be obligated is being determined, less the estimate
made pursuant to paragraph (1) for such most recent fiscal year; and
[[Page 52065]]
(c) amounts permitted in preceding fiscal years to be obligated
that have not been obligated.
(2) Assessments collected in excess of the amount permitted to be
obligated in a fiscal year shall be deposited in an escrow account
until the end of fiscal year 2030.
(3) Prior to the end of fiscal year 2030, the Board may not
obligate, expend, or borrow against amounts deposited in the escrow
account. Any interest earned on such amounts shall be deposited in the
escrow account and shall be unavailable for obligation until the end of
fiscal year 2030.
Section 1500.50(f) proposes that, with approval of the Secretary,
the Board may borrow money for the payment of administrative expenses,
subject to the same fiscal, budget and audit controls as other funds of
the Board. Any funds borrowed by the Board, however, shall be expended
only for startup costs and capital outlays. See 15 U.S.C.
8704(d)(3)(B).
Section 1500.50(g) proposes that the Board shall reimburse the
Secretary for all expenses incurred by the Secretary in the
implementation, administration and supervision of the order, including
all referendum costs in connection with the order. See 15 U.S.C.
8704(d)(3)(D).
Section 1500.50(h) proposes that, following the third fiscal year
of operation of the Board, the total cost of collection of expenses and
administrative staff incurred by the Board during any fiscal year shall
not exceed 10 percent of the projected total assessments to be
collected and other income received by the Board for that fiscal year
after any fees owed to the Department are paid. Reimbursements to the
Secretary required under paragraph (g) are excluded from this
limitation on spending. See 15 U.S.C. 8704(d)(3)(C).
Section 1500.50(i) proposes that the Board may invest assessments
and other revenues collected in: (1) Obligations of the United States
or any agency of the United States; (2) general obligations of any
state or any political subdivision of a state; (3) interest bearing
accounts or certificates of deposit of financial institutions that are
members of the Federal Reserve System; or (4) obligations fully
guaranteed as to principal interest by the United States. 15 U.S.C.
8705(e).
Section 1500.50(j) clarifies that investment income and revenue
earned under the previous paragraph are earnings obtained from
assessment that are subject to budget approval by the Secretary.
Section 1500.51--Assessments
Section 1500.51(a) of the proposed order proposes that the
collection of assessments on concrete masonry units will be the
responsibility of the manufacturer who sells the concrete masonry
units. The Act specifies that assessments shall be remitted by
manufacturers to the Board in the manner prescribed by the order. 15
U.S.C. 8705(b)(1). Further, there will only be an assessment on the
first sale of concrete masonry units, and not on the subsequent sale of
concrete masonry units already assessed. As required by the Act,
manufacturers will be required to collect and remit assessments no less
than quarterly. 15 U.S.C. 8705(b)(2). Also, as required by the Act,
manufacturers are directed to identify the total amount due in
assessments on all sales receipts, invoices or other commercial
documents of sale as a result of the sale of concrete masonry units. 15
U.S.C. 8705(b)(3). In order to help implement these provisions, the
Board is directed to provide a proposed compliance program for review
and approval by the Secretary within 180 days of their initial meeting.
A proposed compliance program and its plan to verify compliance with
the Act will outline the way the Board will receive assessments, how
they will verify compliance, determine the best method to track sales,
and how to document all actions.
Section 1500.51(b) sets forth the initial rate of assessment of
$0.01 per concrete masonry unit sold by a manufacturer as specified in
the Act. 15 U.S.C. 8705(c)(1). The Board may make assessments effective
as of the effective date of the proposed order. Manufacturers would
submit funds to the Board within 60 days of the end of the first
quarter after the Board is established; thereafter submission of funds
would be made to the Board within 60 days of the end of each quarter.
Section 1500.51(c) proposes that, upon the affirmative vote of two-
thirds of the voting members of the Board, the Board may modify the
assessment rate. 15 U.S.C. 8705(c)(2)(A). This is subject to the
provision that the rate may be raised to a maximum of $0.05 cents per
unit, 15 U.S.C. 8705(c)(2)(B), that only one increase or decrease may
be implemented in any one-year period, 15 U.S.C. 8705(c)(2)(D), and
that each individual increase may not exceed $0.01, 15 U.S.C.
8705(c)(2)(C).
Section 1500.51(d) proposes that not less than 50 percent of the
assessments (less administration expenses) paid by a manufacturer shall
be used to support research, education, and promotion programs and
projects in support of the Geographic Region of the manufacturer. This
requirement is taken directly from the Act. 15 U.S.C. 8705(f)(1).
Section 1500.51(e) proposes that assessment payments and reports
will be submitted to the Board quarterly. See 15 U.S.C. 8705(b)(2). All
quarterly payments are to be received no later than 60 days after the
conclusion of each quarter. A late payment charge will be imposed on
manufacturers who fail to submit payment by the due date established by
the Board. See 15 U.S.C. 8705(d)(1). In addition to the late payment
charge, there will be an interest charge on the outstanding amount. See
15 U.S.C. 8705(d)(1). In accordance with the Act, the rate of interest
and late payment charges shall be specified by the Secretary. See 15
U.S.C. 8705(d)(2).
Section 1500.51(f) explains that manufacturers failing to remit
total assessments due in a timely manner may also be subject to actions
under Federal debt collection procedures.
Section 1500.51(g) proposes that the Board may authorize other
organizations to collect assessments on its behalf, subject to approval
of the Secretary.
Finally, Sec. 1500.51(h) proposes that the Board shall provide
manufacturers with the opportunity to apply for rebates on assessments
remitted to the Board for concrete masonry units not covered by this
order, and for assessments remitted to the Board for concrete masonry
units sold to a purchaser that subsequently failed to remit payment due
to bankruptcy, bad debt, or other reasons. Those requesting rebates
will have to provide all necessary documentation as determined by the
Board.
Section 1500.60--Programs and Projects
Section 1500.60(a) proposes that the Board shall receive and
evaluate, or on its own initiative develop, any program or project
authorized under the proposed order. This section further proposes that
the Board will submit any such program or project to the Secretary for
approval. See 15 U.S.C. 8704(d)(1). Such programs or projects shall
provide for: (1) the establishment, issuance, effectuation and
administration of appropriate programs for research, education, and
promotion with respect to concrete masonry; and (2) the establishment
and conduct of research with respect to the image, desirability, use,
marketability, quality or production of concrete masonry products, to
the end that the marketing and use of concrete masonry products may be
encouraged, expanded, improved or made more acceptable, and to advance
[[Page 52066]]
the image, desirability or quality of concrete masonry product. See 15
U.S.C. 8701(a).
Section 1500.60(b) proposes that the Board will not implement a
program or project prior to receiving approval from the Secretary. See
15 U.S.C. 8704(d)(1). Once the Secretary approves a program or project,
the Board will take appropriate steps to implement it. A contract or
agreement for a program or project will be deemed approved if the
Secretary fails to approve or reject it within 60 days of receipt,
unless the Secretary provides a reasonable justification for the delay
to the Board and Congress, along with a reasonable date for approval or
disapproval. See 15 U.S.C. 8704(e)(3). The Department may provide
justification in any written format.
Any such contract or agreement shall provide that: (1) The
contractor or agreeing party shall develop and submit to the Board a
program or project together with a budget or budgets that shall show
the estimated cost to be incurred for such program or project, see 15
U.S.C. 8704(e)(2)(A). Further, the contractor or agreeing party shall
keep accurate records of all its transactions and make periodic reports
to the Board of activities conducted, see 15 U.S.C. 8704(e)(2)(B) &
(D); submit accounting for funds received and expended, see 15 U.S.C.
8704(e)(2)(C); and make such other reports as the Secretary or the
Board may require, see 15 U.S.C. 8704(e)(2)(E). This section also
proposes that the Secretary may audit the records of the contracting or
agreeing party periodically; that any subcontractor who enters into a
contract with a Board contractor and who receives Board funds will be
subject to the same provisions as the contractor; and that the contract
or agreement shall become effective on the approval of the Secretary.
Section 1500.60(c) proposes that programs or projects implemented
under the proposed order will be reviewed or evaluated periodically by
the Board to ensure that they contribute to an effective program of
research, education, or promotion. If the Board finds that a program or
project does not contribute to an effective program of research,
education, or promotion, then the Board will terminate that program or
project, subject to the approval of the Secretary.
Section 1500.60(d) proposes that any educational or promotional
activity undertaken with funds provided by the Board shall include a
statement that such activities were supported in whole or in part by
the Board. 15 U.S.C. 8704(d)(1)(B).
Finally, Sec. 1500.60(e) proposes that, every two years, the Board
shall prepare and make publicly available a comprehensive and detailed
report that includes an identification and description of all programs
and projects undertaken by the Board during the previous two years, as
well as those planned for the subsequent two years. The report will
detail the allocation or planned allocation of Board resources for each
program or project, and will also include: (1) The overall financial
condition of the Board; (2) a summary of the amounts obligated or
expended during the two preceding fiscal years; and (3) a description
of the extent to which the objectives of the Board were met according
to the metrics required under Sec. 1500.50(a)(1). See 15 U.S.C.
8704(j).
Section 1500.61--Independent Evaluation
Section 1500.61 proposes that the Board shall authorize and fund an
independent evaluation of the effectiveness of the proposed order and
other programs conducted by the Board beginning five years after
October 5, 2018 and every three years thereafter. The Board will submit
to the Secretary, and make available to the public, the results of each
periodic independent evaluation. See 15 U.S.C. 8704(h).
Section 1500.62--Patents, Copyrights, Trademarks, Information,
Publications, and Product Formulations
Section 1500.62 proposes that ownership and allocation of rights to
patents, copyrights, inventions, or publications, developed through the
use of non-Federal funds remitted to the Board under the proposed order
shall be determined by written agreement between the Board and the
party(ies) receiving funds for the development of such inventions,
patents, copyrights, or publications. The Department believes that
``trademarks'' were inadvertently left off of this list, as they are
included in the heading, and intends to include them in the final
order, subject to public comment.
Reports, Books, and Records
Section 1500.70--Reports
Section 1500.70(a) proposes that manufacturers subject to the
proposed order may be required to periodically provide such information
as required by the Board, with the approval of the Secretary. This
information may include but is not limited to: The number and type of
concrete masonry units manufactured; the number and type of concrete
masonry units on which an assessment was paid; the name and address of
the manufacturer; manufacturer employee identification number; the date
of assessment payment on each concrete masonry unit sold; and similar
assessment accounting information. The previously noted ICR regarding
assessments also supports this requirement. The Department is seeking
approval for these ICRs.
Section 1500.70(b) proposes that all of the reports described above
are due to the Board 60 days after the end of each quarter, and
Section 1500.70(c) proposes that all such reports and information
submitted shall be subject to confidentiality restrictions in Sec.
1500.72.
Section 1500.71--Assessments
Section 1500.71 proposes that each manufacturer subject to the
proposed order shall maintain and make available for inspection by the
Secretary, or the Board when acting on behalf of the Secrtary, such
books and records as are necessary to carry out the provisions of the
order and the regulations issued thereunder, including such records as
are necessary to verify any reports required. See 15 U.S.C. 8704(k)(1).
Such records shall be retained for at least seven years beyond the
fiscal period of their applicability. See 15 U.S.C. 8704(k)(2).
Section 1500.72--Confidential Treatment
Section 1500.72(a) proposes that trade secrets and commercial or
financial information that is privileged or confidential obtained from
books, records, or reports under the Act, the proposed order, and the
regulations issued thereunder shall be kept confidential by all
persons, including all employees and former employees of the Board, all
officers and employees and former officers and employees of contracting
and subcontracting agencies or agreeing parties having access to such
information. Such information shall not be available to Board members
or manufacturers. Only those persons having a specific need for such
information to effectively administer the provisions of the proposed
order shall have access to such information. See 15 U.S.C.
8704(k)(3)(A). In accordance with the Act, such information may be
disclosed only if (1) the Secretary considers the information relevant;
and (2) the information is revealed in a judicial proceeding or
administrative hearing brought at the direction or on the request of
the Secretary or to which the Secretary or any officer of the
Department is a party. 15 U.S.C. 8704(k)(3)(B). Also in accordance with
[[Page 52067]]
the Act, any officer, employee, or agent of the Department of Commerce
or any officer, employee, or agent of the Board who willfully violates
the above provisions of the proposed order shall be fined not more than
$1,000 and imprisoned for not more than 1 year, or both. 15 U.S.C.
8704(k)(3)(D). However, nothing in this section shall be deemed to
prohibit: (1) The issuance of general statements based upon the reports
of the number of persons subject to the proposed order or statistical
data collected therefrom, as long as the statements do not identify the
information furnished by any person; and (2) the publication, by
direction of the Secretary, of the name of any person who has been
adjudged to have violated the proposed order and the specific
provisions that were violated. See 15 U.S.C. 8704(k)(3)(C).
Section 1500.72(b) would clarify that, for any officer, employee,
or agent of the Department of Commerce, these provisions are consistent
with and do not supersede, conflict with, or otherwise alter any
obligations, rights, or liabilities created by existing statute or
Executive Order relating to classified information, communications to
Congress, the reporting to an Inspector General of a violation of any
law, rule, or regulation, or mismanagement, a gross waste of funds, an
abuse of authority, or a substantial and specific danger to public
health or safety, or any other whistleblower protection.
Miscellaneous
Section 1500.80--Right of the Secretary
Section 1500.80 proposes that all fiscal matters, programs or
projects, rules or regulations, reports, or other actions proposed and
prepared by the Board shall be submitted to the Secretary for approval.
Section 1500.81--Referenda
Section 1500.81(a) proposes that a referendum will be held to
determine whether manufacturers favor enactment of the proposed order.
See 15 U.S.C. 8706(a)(1). The proposed referendum procedures are being
published in a separate notice in the Federal Register. See 15 U.S.C.
8706(c)(1) (``Referenda conducted pursuant to this section shall be
conducted in a manner determined by the Secretary.'') A manufacturer
will be considered eligible to vote if the manufacturer has
manufactured concrete masonry products during a period of at least 180
days prior to the first day of the period during which voting in the
referendum will occur. 15 U.S.C. 8706(b)(2). The Act directs the
Secretary to conduct the referendum ``among [eligible] manufacturers .
. . subject to assessments under section 8705 of this title.''
The Act does not define the phrase ``subject to assessment'' and
therefore, the Secretary must interpret the statute to determine
whether all manufacturers of concrete masonry products should
participate in the referendum, or whether only manufacturers of
concrete masonry units should participate. The phrase ``subject to
assessment'' could mean: (1) Meeting only the eligibility requirement
described above (that is, having manufactured concrete masonry products
during the 180-day period prior to voting), or (2) both meeting the
eligibility requirement and being subject to the initial rate of
assessment. Under interpretation (1), the referendum would be conducted
among all manufacturers who had manufactured concrete masonry products
during the 180-day period prior to voting. Under interpretation (2),
because the initial rate of assessment is applied only to concrete
masonry units sold, the referendum would be conducted among all
manufacturers who had manufactured concrete masonry units during the
180-day period prior to voting. Under the Act, ``concrete masonry
products'' refers to a broader class of products than concrete masonry
units, including hardscape products such as concrete pavers and
segmental retaining wall units.
Where a statute leaves a gap or is ambiguous, courts will typically
look to see whether the agency's interpretation was reasonable in light
of the text, nature, and purpose of the statute. See, e.g., Cuozzo
Speed Techs., LLC v. Lee, 136 S. Ct. 2131, 2134 (U.S. June 20, 2016).
In the absence of a statutory definition, courts ``construe a statutory
term in accordance with its ordinary or natural meaning.'' FDIC v.
Meyer, 510 U.S. 471, 476 (1994). The most relevant definition of
``subject to'' is ``affected by or possibly affected by'' something.\4\
Only manufacturers of concrete masonry units will actually have to pay,
or be affected by, the initial rate of assessment. The Department
believes, therefore, that the most natural reading of the statute is
that only concrete masonry unit manufacturers are ``subject to''
assessment and therefore eligible to participate in the referendum.
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\4\ ``Subject to.'' Merriam-Webster.com Dictionary, Merriam-
Webster, https://www.merriam-webster.com/dictionary/subject%20to.
Accessed 20 Jun. 2020.
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This reading is also consistent with the stated purpose of the Act
as described in 15 U.S.C. 8701. Senate Report 115-218 includes the
Congressional Budget Office's (CBO) estimate concerning the Act's
impacts, and notes the following assumption:
The bill [S. 374] would apply to producers of both concrete
block and concrete pavers, but CBO expects that only producers of
concrete block would participate in the referendum. Because there is
little differentiation among concrete blocks across manufacturers,
all producers of concrete blocks would benefit from an industry-wide
research and promotion program. Manufacturers of concrete pavers, on
the other hand, are able to distinguish their products in ways that
allow consumers to recognize individual brands. Consequently, those
producers have little incentive to participate in an industry-wide
marketing effort. Based on information from manufacturers of
concrete pavers, CBO expects that those producers would not
participate in the referendum.
Senate Report 115-218, at 4 (Mar. 22, 2018).
Based upon both the language and the overarching purpose of the
statute, and because concrete masonry unit manufacturers are currently
the only manufacturers who have an incentive to participate in this
program, the Department interprets the Act to mean that only
manufacturers subject to the initial rate of assessment are ``subject
to assessment,'' in accordance with interpretation (2). Therefore, for
the initial referendum, an eligible person would be a manufacturer of
concrete units that is subject to the initial rate of assessment.
Further, the proposed order protects the interests of concrete masonry
product manufacturers by leaving open their eligibility for Board
membership, as well as the possibility that future orders could have a
broader scope rather than being limited to concrete masonry unit
manufacturers.
Therefore, for the initial referendum, an eligible person would be
a manufacturer of concrete units that is subject to the initial rate of
assessment in Sec. 1500.51, that is, $0.01 per concrete masonry unit
sold by a manufacturer. See 15 U.S.C. 8705(c)(1). Each manufacturer
eligible to vote in the referendum shall be entitled to one vote. 15
U.S.C. 8706(b)(1). For the order to go into effect, there must be a
majority ``yes'' vote by both: (1) The total number of concrete masonry
unit manufacturers voting; and (2) manufacturers who operate a majority
of the machine cavities operated by the manufacturers voting in the
referendum. 15 U.S.C. 8706(a)(2).
Section 1500.81(b) proposes that, after the initial referendum, the
Secretary shall conduct a referendum upon the request of the Board, or
effective beginning on the date that is five years after the date of
approval of the
[[Page 52068]]
proposed order, and at five-year intervals thereafter, by petition from
not less than 25% of manufacturers eligible to vote. For any new
proposed order, voter eligibility will be based on the scope of such
proposed order. Each manufacturer eligible to vote in subsequent
referenda shall be entitled to one vote. The proposed order shall
continue if it meets the same requirements for a majority ``yes'' vote
described above.
Section 1500.82--Suspension or Termination
Section 1500.82(a) proposes that the Secretary shall suspend or
terminate an order or a provision of an order if the Secretary finds
that an order or provision of an order obstructs or does not tend to
effectuate the purpose of the Act, or if the Secretary determines that
the order or a provision of an order is not favored by a majority of
all votes cast in the referendum as provided in Sec. 1500.81. See 15
U.S.C. 8706(e) & 8710. If the Secretary suspends or terminates a
provision of an order, the order remains in effect minus the suspended
or terminated provision.
Section 1500.82(b) proposes that if, as a result of a referendum
conducted under Sec. 1500.81 of the proposed order, the Secretary
determines that the order is not approved, the Secretary shall: (1) Not
later than 180 days after making the determination, suspend or
terminate collection of assessments under the proposed order; and (2)
as soon as practical, suspend or terminate activities under this order
in an orderly manner. 15 U.S.C. 8710(b).
Section 1500.83--Effect of Termination or Amendment
Section 1500.83 proposes that, unless otherwise expressly provided
by the Secretary, the termination of the proposed order, or the
issuance of any amendment to either thereof, shall not: (a) Affect or
waive any right, duty, obligation or liability which shall have arisen
or which may thereafter arise in connection with any provision of the
proposed order or any regulation issued thereunder; (b) release or
extinguish any violation of the proposed order or any regulation issued
thereunder; or (c) affect or impair any rights or remedies of the
United States, or of the Secretary or of any other persons, with
respect to any such violation. The Department believes that the
intended language of this provision was likely ``. . . issuance of any
amendment,'' rather than ``. . . issuance of any amendment to either
thereof,'' and intends to edit this text following public comment.
Section 1500.84--Notice and Advance Registration
Section 1500.84 proposes that, as required by the Act, not later
than 30 days before a referendum is to be conducted under the proposed
order, the Secretary shall notify all manufacturers of the period
during which the referendum will occur through publication in the
Federal Register. To clarify this statement, the Secretary interprets
that notice can occur 30 or more days in advance of the referendum
start date (i.e., notice cannot be less than 30 days). 15 U.S.C.
8706(c)(4). The notice will explain any registration and voting
procedures. See 15 U.S.C. 8706(c)(3). A manufacturer who chooses to
vote in a referendum conducted under the proposed order shall register
with the Secretary prior to the voting period. 15 U.S.C. 8706(c)(2).
Section 1500.85--Personal Liability
Section 1500.85 proposes that no member, alternate member, or
employee of the Board shall be held personally responsible, either
individually or jointly with others, in any way whatsoever, to any
person for errors in judgment, mistakes or other acts, either of
commission or omission, as such member or employee, except for acts of
dishonesty or willful misconduct.
Section 1500.86--Separability
Section 1500.86 proposes that if any provision of the proposed
order, or its applicability to any person or circumstance, is declared
invalid, the validity of the remainder of the proposed order or its
applicability will not be affected.
Section 1500.87--Amendments
Section 1500.87 proposes that the Secretary may, from time to time,
amend an order. 15 U.S.C. 8703(c). Amendments to the proposed order may
be proposed from time to time by the Board or by any interested person
affected by the provisions of the Act, including the Secretary. See 15
U.S.C. 8704(c). The provisions of the Act applicable to an order shall
be applicable to any amendment to an order. 15 U.S.C. 8703(c) & 8711.
Section 1500.88--OMB Control Number
If the ICRs in the proposed order are approved by OMB under the
Paperwork Reduction Act of 1995, 44 U.S.C. Chapter 35, this section
would include the OMB control number.
Classification
Executive Order 12866
This rulemaking is not a significant regulatory action under
Executive Order 12866.
Executive Order 13771
This rule is not subject to the requirements of Executive Order
13771 because it is not a significant regulatory action under Executive
Order 12866.
Executive Order 13132
This proposed rule does not contain policies with Federalism
implications as defined in Executive Order 13132.
Regulatory Flexibility Act: Initial Regulatory Flexibility Analysis
The Regulatory Flexibility Act (RFA), first enacted in 1980 and
codified at 5 U.S.C. 600-611, was intended to place the burden on the
government to review all new regulations to ensure that, while
accomplishing their intended purposes, they do not unduly inhibit the
ability of small entities to compete. The RFA recognizes that the size
of a business, unit of government, or nonprofit organization can have a
bearing on its ability to comply with Federal regulations. Major goals
of the RFA are: (1) To increase agency awareness and understanding of
the impact of their regulations on small business; (2) to require that
agencies communicate and explain their findings to the public; and (3)
to encourage agencies to use flexibility and to provide regulatory
relief to small entities.
The RFA emphasizes predicting significant adverse impacts on small
entities as a group distinct from other entities and on the
consideration of alternatives that may minimize the impacts, while
still achieving the stated objective of the action. When an agency
publishes a proposed regulatory action, it must either: (1) Certify
that the action will not have a significant adverse impact on a
substantial number of small entities, and support such a certification
declaration with a factual basis, demonstrating this outcome, or, (2)
if such a certification cannot be supported by a factual basis, prepare
and make available for public review an Initial Regulatory Flexibility
Analysis (IRFA) that describes the impact of the proposed rule on small
entities.
The following paragraphs are a summary of the IRFA for the proposed
order:
Basis and Purpose of the Rule
This action is taken under the authority of the Act, which
authorizes a research, education, and promotion
[[Page 52069]]
program for concrete masonry products, also known as a checkoff
program. The checkoff program would be established by an order issued
by the Secretary that is subject to approval by an industry referendum.
The program would then be carried out by a Board, which would develop
research and education programs as well as efforts to promote concrete
masonry products in domestic markets. Board activities would be funded
by assessments on manufacturers of concrete masonry products, based on
the number of masonry units sold each quarter. A proposed order
submitted by industry to the Department on April 15, 2020, triggered a
referendum deadline of approximately 8 months from submission, and the
proposed order must be published in the Federal Register within 90 days
of receipt. A succinct statement of the objectives of, and legal basis
for, the proposed rule is contained elsewhere in the preamble and is
not repeated here.
Number of Affected Entities
The proposed order applies to products manufactured on concrete
block machines and used for construction. As indicated by the data
below and confirmed by industry experts, the industry is dominated by
small entities.
The U.S. Small Business Administration size standard to qualify as
a small business in this industry is 500 or fewer employees.\5\
According to Census data, there were 430 firms and 686 establishments
engaged in concrete block and brick manufacturing in 2017.\6\ Of these,
401 firms, or 93 percent, employed fewer than 500 employees, and these
small firms accounted for 514 establishments, or 75 percent of all
establishments, and about 62 percent of industry employment.\7\
---------------------------------------------------------------------------
\5\ See ``Table of Small Business Size Standards Matched to
North American Industry Classification System Codes'' on the U.S.
Small Business Administration website.
\6\ A firm is a business organization consisting of one or more
domestic establishments in the same state and industry that were
specified under common ownership or control and an establishment is
a single physical location at which business is conducted or
services or industrial operations are performed. See ``Statistics of
U.S. Businesses Glossary'' on the U.S. Census Bureau website.
\7\ See ``2017 SUSB Annual Data Tables by Establishment
Industry'' on the U.S. Census Bureau website. For more information,
see the County Business Patterns methodology on the Census website.
[GRAPHIC] [TIFF OMITTED] TP24AU20.014
Large firms represent about 7 percent of all firms and account for
25 percent of plants, about 38 percent of employment, and 39 percent of
estimated receipts. This appears to be consistent with the information
from industry experts that roughly 5 percent of manufacturers account
for 40 percent of production capacity measured by machine cavities.\8\
Based on these estimates of share of establishments and machine
cavities, we estimate that large employers (500 or more employees)
account for 25 to 40 percent of industry production of concrete masonry
units and, conversely, that small firms (fewer than 500 employees)
account for 60 to 75 percent of production of concrete masonry units.
---------------------------------------------------------------------------
\8\ Manufacturers use block machines to produce concrete block.
A block machine uses vibration and compaction to form the concrete
masonry product from a cement mixture poured into a mold. The term
``cavity'' is the open space in the mold and equates to a single
block.
---------------------------------------------------------------------------
Costs to Affected Entities
Assessment costs--Under the proposed order, concrete masonry unit
manufacturers would be required to pay assessments to the Board to fund
the research, education, and promotion programs of the Board.
Assessment rates are dictated by the Act, which specifies assessments
of $0.01 per unit sold, up to a maximum of $0.05 per unit sold, with
assessments increasing by no more than $0.01 per year.
To estimate the costs to businesses, the Department estimates a
range of assessment revenues, with the lower bound calculated using
assessments of $0.01 with no increases in future years and the upper
bound calculated using the maximum assessment rates permitted under the
Act--$0.01 in the first year, increasing by $0.01 in subsequent years
to the maximum of $0.05 in the fifth year and thereafter.
To estimate the number of units sold by small entities, the
Department relies on industry reports that show there were 1.15 billion
concrete masonry units produced in 2018. Assuming small businesses
produced 60 to 75 percent of overall production, we estimate that
between 690 and 862.5 million units would be produced by small
businesses in the first year of the program. Based on these estimates,
total estimated assessments on small businesses based on $0.01 per unit
produced would be $6.90 million to $8.63 million in the first year.
To estimate a lower bound on expected annual assessment costs, we
assume assessments remain constant at $0.01 for 10 years and industry
[[Page 52070]]
production grows with inflation. Therefore, total assessments on small
businesses over the next 10 years is expected to be $6.90 million to
$8.63 million per year. The midpoint of this range, $7.76 million, is
the Department's lower bound estimate of annual costs to small
businesses. This amounts to $19,358 per firm each year.
To estimate an upper bound estimate of costs, we assume the Board
institutes the maximum assessment authorized under the legislation,
resulting in a $0.01 per unit assessment in year 1, $0.02 in year 2,
$0.03 in year 3, $0.04 in year 4, and $0.05 in years 5 through 10.
Again, assuming industry production grows with inflation, total
assessments on small businesses over the next 10 years would be
expected to average $27.60 million to $34.50 million per year. The
midpoint of this range, $31.05 million, is the Department's upper bound
estimate of annual costs to small businesses. This amounts to an
average of $77,431 per firm each year.
Applying the Department's upper bound cost estimate to the receipts
estimated by the Census Bureau for this industry, total costs on small
businesses represent about 1.1 percent of small business receipts
(shown in ``Table 3: Block and Brick Manufacturers 2017 by Business
Size,'' employment size less than 500). Again, this would be the
average over the 10-year period. Assessments would be lowest in year 1
and highest in years 5 through 10.
These estimated assessment costs are based on the limited
information available for the concrete and brick manufacturers
industry. For this analysis, the Department relies on industry
estimates for annual unit production. Because unit production is not
available by business size, we estimate a range of unit production
using establishment data from the U.S. Census Bureau for NAICS industry
327331. Because the number of firms estimated by industry experts
differs from the number of firms under NAICS industry 327331, we
request comments regarding the number and size of entities covered
under the proposed order, including whether production occurs among
businesses not classified under NAICS industry 327331.
Reporting costs--In addition to assessments paid on concrete
masonry units, there are reporting costs associated with adoption of
the proposed order. Under the proposed order, each manufacturer may be
required to periodically provide to the Board such information as may
be required by the Board, with the approval of the Secretary, which may
include, but not be limited to, the following:
1. Number and type of concrete masonry units manufactured;
2. Number and type of concrete masonry units on which an assessment
was paid;
3. Name and address of the manufacturer; and
4. Date assessment was paid on each concrete masonry unit sold.
We expect these reporting costs to be incurred with the quarterly
assessments paid by manufacturers. We estimate that managers would
spend 60 minutes per quarterly report. According to the Bureau of Labor
Statistics, the median pay for industrial production managers is $50.71
per hour.\9\ Thus, we estimate that firms will pay, on average, $202.84
for reporting costs per year.
---------------------------------------------------------------------------
\9\ See the Occupational Outlook Handbook on the Bureau of Labor
statistics website.
---------------------------------------------------------------------------
Benefits for Affected Entities
Even if the order results in a significant cost for a substantial
number of small businesses, these costs are expected to result in
benefits to businesses that are at least commensurate with these costs.
The assessments pay for investments in product research, education, and
promotion programs that are intended to yield direct benefits to
concrete product manufacturers in the form of new markets and increased
consumer demand.
Alternatives: Consideration of a De Minimis Exemption
The Department recognizes that some small businesses with minimal
production in the industry may not have the resources to comply with
the requirements imposed by the proposed order, and therefore, the
Department may consider a de minimis exemption for these small
businesses. A de minimis exemption would exclude from the order some
small businesses with minimal production, based on measures of unit
production, employment, receipts, machine cavities, or other relevant
criteria.
A possible de minimis exemption would exclude companies with fewer
than five employees. According to Census Bureau data (see ``Table 3:
Block and Brick Manufacturers 2017 by Business Size''), these firms
represent 13 percent of establishments in the industry, 1 percent of
industry employment, and 1 percent of annual receipts for the industry.
Another possible de minimis exemption would exclude companies with
fewer than ten employees. According to Census Bureau data (see ``Table
3: Block and Brick Manufacturers 2017 by Business Size''), these firms
represent 23 percent of establishments in the industry, 4 percent of
industry employment, and 3 percent of annual receipts for the industry.
The Department requests comments regarding a possible de minimis
exemption.
Request for Comments
The Department requests comments on the Initial Regulatory
Flexibility Act Analysis. Specifically, comments regarding:
1. Information about concrete masonry unit production, including:
a. Estimated annual production of concrete masonry units for the
industry as a whole and by business size;
b. The number and size of entities covered under the proposed
order, including whether production occurs among businesses not
classified under NAICS industry 327331; and
c. An estimated sales price for concrete masonry units.
2. Whether to include a de minimis exemption and what criteria to
use for an exemption; and
3. The approach used to estimate the impact of the proposed order
on industry and small businesses and suggestions for alternative
approaches.
Paperwork Reduction Act
The ICRs in this proposed rule are being submitted for approval to
OMB under the Paperwork Reduction Act of 1995, 44 U.S.C. 3501 et seq.
This section contains the new ICRs and the estimated time to fulfill
each requirement. There are two new ICRs associated with the proposed
order--one dealing with the Board nomination process and a second with
the assessment and reporting requirements.
In order to make an informed decision on appointments of members
and alternate members to the Board as well as obtaining an appropriate
balance on the Board, the Secretary will need adequate information on
all candidate nominees. The Department will restrict the information
request to that information needed to determine requisite expertise of
potential nominees and will include biography, experience, status as a
current manufacturer, type of products manufactured, place of business,
size of business, statement of interest, and similar background
information.
Estimated burden: Public recordkeeping burden for this collection
of information is estimated to average 1.0 hour per application.
[[Page 52071]]
Respondents: Manufacturers and others associated with the concrete
masonry products industry.
Estimated Number of Respondents: 50.
Estimated Number of Responses per Respondent: 1.
Estimated Total Annual Burden on Respondents: 50 hours.
(2) Background Statement
To fulfill the requirement to oversee assessment collection as well
as the requirement to maintain adequate records the Secretary will need
information to support adequate oversight in these areas. The
Department will restrict the information request to that information
needed to determine the amount of assessment and will include: The
number and type of concrete masonry units manufactured; the number and
type of concrete masonry units on which an assessment was paid; the
name and address of the manufacturer; manufacturer employee
identification number; and the date of assessment payment on each
concrete masonry unit sold; and related assessment accounting
information. All estimates include the time for reviewing instructions;
searching existing data sources; gathering or maintaining the needed
data; and reviewing the information.
Estimated burden: Public recordkeeping burden for this collection
of information is estimated to average 1 hour per quarterly report.
Respondents: Manufacturers of concrete masonry products.
Estimated Number of Respondents: 690.
Estimated Number of Responses per Respondent: 4 per year.
Estimated Total Annual Burden on Respondents: 2760 hours.
As part of its continuing effort to reduce paperwork and respondent
burden, the Department invites the general public and other Federal
agencies to comment on proposed and/or continuing information
collections, as required by the Paperwork Reduction Act. The Department
solicits comments concerning: Whether these ICRs are necessary for the
proper performance of the functions of the Department, including
whether the information has practical utility; the accuracy of the
Department's estimates of the burden of the ICRs; the quality, utility,
and clarity of the information to be collected; and whether the burden
of collection of information on those who are to respond, including
through the use of automated collection techniques or other forms of
information technology, may be minimized. The ICR may be viewed on the
Reginfo.gov website. Organizations and individuals desiring to submit
comments on the collection of information requirements should see the
ADDRESSES section of this document. The final rule will respond to any
public comments on the ICRs contained in this proposal. Notwithstanding
any other provision of the law, no person is required to respond to,
and no person will be subject to penalty for failure to comply with, a
collection of information subject to the requirements of the PRA,
unless that collection of information displays a currently valid OMB
control number.
National Environmental Policy Act
This proposed rule will not significantly affect the quality of the
human environment. Therefore, an environmental assessment or
Environmental Impact Statement is not required to be prepared under the
National Environmental Policy Act of 1969.
List of Subjects in 15 CFR Part 1500
Administrative practice and procedure, Advertising, Consumer
information, Marketing agreements, Concrete masonry promotion,
Reporting and recordkeeping requirements.
0
For the reasons stated in the preamble, under the authority at 15
U.S.C. 8701-8717, the Office of the Under-Secretary for Economic
Affairs, Department of Commerce proposes to establish Chapter XV,
consisting of 15 CFR part 1500 as set forth below:
CHAPTER XV--OFFICE OF THE UNDER-SECRETARY FOR ECONOMIC AFFAIRS
PART 1500--CONCRETE MASONRY PRODUCTS RESEARCH, EDUCATION, AND
PROMOTION
Subpart A--Concrete Masonry Products Research, Education, and
Promotion Order
Definitions
Sec.
1500.1 Act.
1500.2 Block Machine.
1500.3 Board.
1500.4 Cavity.
1500.5 Concrete Masonry Products.
1500.6 Concrete Masonry Unit.
1500.7 Conflict of Interest.
1500.8 Department.
1500.9 Dry-Cast Concrete.
1500.10 Education.
1500.11 Geographic Regions.
1500.12 Machine Cavities.
1500.13 Machine Cavities in Operation.
1500.14 Manufacturer.
1500.15 Masonry Unit.
1500.16 Order.
1500.17 Person.
1500.18 Promotion.
1500.19 Research.
1500.20 Secretary.
1500.21 United States.
Concrete Masonry Products Board
1500.40 Establishment and membership.
1500.43 Vacancies.
1500.44 Disqualification.
1500.45 Procedure.
1500.46 Compensation and reimbursement.
1500.47 Powers and duties.
1500.48 Prohibited activities.
Expenses and Assessments
1500.50 Budget and expenses.
1500.51 Assessments.
1500.60 Programs and projects.
1500.61 Independent evaluation.
1500.62 Patents, copyrights, trademarks, information, publications,
and product formulations.
Reports, Books, and Records
1500.70 Reports.
1500.71 Books and records.
1500.72 Confidential treatment.
Miscellaneous
1500.80 Right of the Secretary.
1500.81 Referenda.
1500.82 Suspension or termination.
1500.83 Effect of termination or amendment.
1500.84 Notice and advance registration.
1500.85 Personal liability.
1500.86 Separability.
1500.87 Amendments.
1500.88 OMB control number.
Authority: 15 U.S.C. 8701-8717.
Definitions
Sec. 1500.1 Act.
Act means the Concrete Masonry Products Research, Education, and
Promotion Act of 2018 (15 U.S.C. 8701 et seq.; Public Law 115-254,
1301, 132 Stat. 3469-3485 (2018)), and any amendments thereto.
Sec. 1500.2 Block Machine.
Block machine means a piece of equipment that utilizes vibration
and compaction to form concrete masonry products.
Sec. 1500.3 Board.
Board means the ``Concrete Masonry Products Board'' established
under Sec. 1500.40 of this Order.
Sec. 1500.4 Cavity.
Cavity means the open space in the mold of a block machine capable
of forming a single concrete masonry unit having nominal plan
dimensions of 8 inches by 16 inches.
Sec. 1500.5 Concrete Masonry Products.
Concrete masonry products means a broader class of products,
including concrete masonry units as well as hardscape products such as
concrete pavers and segmental retaining wall units, manufactured on a
block machine using dry-cast concrete.
[[Page 52072]]
Sec. 1500.6 Concrete Masonry Unit.
Concrete masonry unit means a concrete masonry product that is a
manmade masonry unit having an actual width of 3 inches or greater and
manufactured from dry-cast concrete using a block machine. Such term
includes concrete block and related concrete units used in masonry
applications.
Sec. 1500.7 Conflict of Interest.
Conflict of interest means with respect to a member or employee of
the Board, a situation in which such member or employee has a direct or
indirect financial or other interest in a person that performs a
service for, or enters into a contract with, for anything of economic
value.
Sec. 1500.8 Department.
Department means the United States Department of Commerce.
Sec. 1500.9 Dry-Cast Concrete.
Dry-cast concrete means a composite material that is composed
essentially of aggregates embedded in a binding medium composed of a
mixture of cementitious materials (including hydraulic cement,
pozzolans, or other cementitious materials) and water of such a
consistency to maintain its shape after forming in a block machine.
Sec. 1500.10 Education.
Education means programs that will educate or communicate the
benefits of concrete masonry products in safe and environmentally
sustainable development, advancements in concrete masonry product
technology and development, and other information and programs designed
to generate increased demand for commercial, residential, multi-family,
and institutional projects using concrete masonry products and to
generally enhance the image of concrete masonry products.
Sec. 1500.11 Geographic Regions.
Geographic Regions means the groupings of states as delineated in
Sec. 1500.40(c) of this Order, for the purpose of supporting research,
education, and promotion plans and projects.
Sec. 1500.12 Machine Cavities.
Machine cavities means the cavities with which a block machine
could be equipped.
Sec. 1500.13 Machine Cavities in Operation.
Machine cavities in operation means those machine cavities
associated with a block machine that have produced concrete masonry
units within the last six months of the date set for determining
eligibility and is fully operable and capable of producing concrete
masonry units.
Sec. 1500.14 Manufacturer.
Manufacturer means any person engaged in the manufacturing of
commercial concrete masonry products in the United States.
Sec. 1500.15 Masonry Unit.
Masonry unit means a noncombustible building product intended to be
laid by hand or joined using mortar, grout, surface bonding, post-
tensioning or some combination of these methods.
Sec. 1500.16 Order.
Order means this Concrete Masonry Products Research, Education, and
Promotion order, including all subparts.
Sec. 1500.17 Person.
Person means any individual, group of individuals, partnership,
corporation, association, cooperative or any other entity.
Sec. 1500.18 Promotion.
Promotion means any action, including paid advertising, to advance
the image and desirability of concrete masonry products with the
express intent of improving the competitive position and stimulating
sales of concrete masonry products in the marketplace.
Sec. 1500.19 Research.
Research means studies testing the effectiveness of market
development and promotion efforts, studies relating to the improvement
of concrete masonry products and new product development, and studies
documenting the performance of concrete masonry.
Sec. 1500.20 Secretary.
Secretary means the Secretary of the United States Department of
Commerce.
Sec. 1500.21 United States.
United States means the several states and the District of
Columbia.
Concrete Masonry Products Board
Sec. 1500.40 Establishment and membership.
(a) The Board is hereby established to carry out a program of
generic promotion, research, and education regarding concrete masonry
products. The Board shall consist of manufacturers and of not fewer
than 15 and not more than 25 members appointed by the Secretary, from
nominations submitted as set forth in Sec. 1500.41. No employee of an
industry trade organization exempt from tax under paragraph (3) or (6)
of section 501(c) of the Internal Revenue Code of 1986 representing the
concrete masonry industry or related industries shall serve as a member
of the Board and no member of the Board may serve concurrently as an
officer of the board of directors of a national concrete masonry
products industry trade association.
(b) The initial Board and all subsequent Boards, unless modified by
the Board as provided in Sec. 1500.40(d), shall be subject to the
following:
(1) To ensure fair and equitable representation of the concrete
masonry products industry, the composition of the Board shall reflect
the geographical distribution of the manufacture of concrete masonry
products in the United States, the types of concrete masonry products
manufactured, and the range in size of manufacturers in the United
States.
(2) No company or its affiliates shall have more than two members
on the Board.
(c) To the extent possible, dependent on the nominees submitted,
the Secretary will strive to appoint at least two members from each
region. Similarly, the Secretary will strive to appoint at least one
member from each of the following districts:
Table 1 to paragraph (c)
------------------------------------------------------------------------
Region District States
------------------------------------------------------------------------
1.......................... 1 Connecticut, Maine,
Massachusetts, New Hampshire,
Rhode Island, and Vermont.
2 New York.
3 Delaware, District of Columbia,
Maryland, New Jersey,
Pennsylvania, and West Virginia.
2.......................... 4 North Carolina, South Carolina,
and Virginia.
5 Alabama, Georgia, Mississippi,
and Tennessee.
6 Florida.
3.......................... 7 Indiana, Kentucky, and Ohio.
8 Illinois, Michigan, and
Wisconsin.
9 Iowa, Minnesota, Nebraska, North
Dakota, and South Dakota.
4.......................... 10 Arkansas, Kansas, Missouri, and
Oklahoma.
11 Louisiana, and Texas.
12 Arizona, and New Mexico.
5.......................... 13 Colorado, Utah, and Wyoming.
14 Alaska, Idaho, Montana, Oregon,
and Washington.
15 California, Hawaii, and Nevada.
------------------------------------------------------------------------
[[Page 52073]]
(d) Three years after the assessment of concrete masonry units
commences pursuant to implementation of this Order, and at the end of
each three-year period thereafter, the Board, subject to the review and
approval of the Secretary, shall, if warranted, recommend to the
Secretary the reapportionment of the Board membership, including but
not limited to modifying the regions and districts set forth in
1500.40(c), and the allocation of Board members to reflect changes in
the geographical distribution of the manufacture of concrete masonry
products and the types of concrete masonry products manufactured.
Sec. 1500.41 Nominations and appointments.
(a) For the initial Board, nominations shall be made and submitted
to the Secretary by manufacturers. The Secretary shall consider the
nominations submitted and other manufacturers for appointment, as the
Secretary may deem appropriate. The Secretary shall appoint the members
and alternate members of the initial Board.
(b) From the nominations, the Secretary shall appoint the 15-25
members of the Board and six alternate members of the Board within a
reasonable time after receiving nominations. If a voting member vacates
the appointment, the Secretary will appoint one of the alternate
members to fill the unexpired term. The Secretary will provide the
Board an opportunity to offer a nominee as successor to fill the term
of the alternate member. In any case in which the Board fails to submit
nominations for any open position, the Secretary shall appoint a member
qualifying for the position under the criteria set forth in Sec.
1500.40.
(c) Nominations by manufacturers for Board members, including self-
nominations will be submitted to the Board. The Board will evaluate the
nominations received, verify the willingness of nominees to serve, and
then will submit to the Secretary at least three nominees for each
vacant position. The Secretary may also receive nominations and may
forward them to the Board for their consideration. From the nominees
not appointed, the Secretary will appoint six alternate members for the
Board. Alternate members will be non-voting members of the Board.
Sec. 1500.42 Term of office.
Board members and any alternates will serve for a term of three
years, except for the initial members as described below. Board members
and any alternates will be able to serve a maximum of two consecutive
three-year terms and may serve additional terms, of up to two
consecutive three-year terms, after rotating off the Board. When the
Board is first established, the initial members will be assigned
initial terms of two, three and four years. Initial terms will be
staggered to assure continuity. Each term of office will end on
December 31, with new terms of office beginning on January 1. Members
serving the initial terms of two and three years will be eligible to
serve a second term of three years.
Thereafter, each of the positions will carry a full three-year
term. Notwithstanding the limitations on consecutive terms, a Board
member or alternate Board member may continue to serve until a
successor is appointed by the Secretary.
Sec. 1500.43 Vacancies.
Should any Board member position become vacant, an alternate will
be appointed by the Secretary for the remainder of the term. Successors
to fill the unexpired terms of the former alternate member shall be
appointed in the manner specified in Sec. 1500.41.
Sec. 1500.44 Disqualification.
(a) In the event that any Board member or alternate Board member
ceases to qualify as a manufacturer, such Board member or alternate
Board member shall be disqualified from serving on the Board.
(b) If a member of the Board consistently refuses to perform the
duties of a member of the Board, or if a member of the Board engages in
acts of dishonesty or willful misconduct, the Board may recommend to
the Secretary that the member be removed from office. All members serve
at the pleasure of the Secretary.
Sec. 1500.45 Procedure.
(a) The Board will meet at least annually. A Board meeting will be
conducted only when a quorum is present. A majority of the Board
members will constitute a quorum. If participation by telephone or
other means is permitted, members participating by such means shall
count as present in determining quorum or other voting requirements set
forth in this section.
(b) At the start of each fiscal period, the Board will select a
Chair, Vice- Chair, Secretary-Treasurer and other officers as
appropriate who will serve in leadership roles throughout that period.
(c) The Board will provide members and manufacturers a minimum of
14 days advance notice of all Board meetings.
(d) Each Board member will be entitled to one vote on any matter
put to vote, and the motion will carry if supported by one vote more
than 50 percent of the total votes represented by the Board members
participating, with the exception of the affirmative vote of two-thirds
of voting members required to change the assessment rate as specified
in Sec. 1500.51(c).
(e) The Board may form committees as necessary. Committees may
consist of individuals other than Board members. Committee members
shall serve without compensation.
(f) When the Board Chair determines that a vote outside a convened
Board meeting is necessary, such vote may take place via electronic
means only if members are given fourteen days prior notice, and if a
majority of the voting Board members participate prior to the
established deadline. Any action so taken shall have the same force and
effect as though such action had been taken at a regularly convened
meeting of the Board.
(g) All votes shall be recorded in Board minutes.
(h) There shall be no voting by proxy.
(i) Board members shall each have one vote. Alternate members shall
not vote. The Chair and all Board officers shall be elected from voting
members of the Board.
(j) The organization of the Board and the procedures for the
conducting of meetings of the Board shall be in accordance with its
bylaws, which shall be established by the Board and approved by the
Secretary.
(k) Meetings of the Board and committees may be conducted by
electronic communications, provided that each member and committee
member, if such committee member is not a member of the Board, is given
prior written notice of the meeting and has the opportunity to be
present either physically or by electronic connection.
Sec. 1500.46 Compensation and reimbursement.
(a) Members and any alternates of the Board shall serve without
compensation.
(b) If approved by the Board, members or alternates shall be
reimbursed for reasonable travel expenses, which may include per diem
allowance or actual subsistence incurred while away from their homes or
regular places of business in the performance of services for the
Board.
Sec. 1500.47 Powers and duties.
The Board shall have the following powers and duties:
[[Page 52074]]
(a) To administer this Order in accordance with its terms and
conditions and to collect assessments;
(b) To develop and recommend to the Secretary for approval such
bylaws as may be necessary for the functioning of the Board;
(c) To make such rules as may be necessary to administer this
Order, including activities to be carried out under this Order;
(d) To meet, organize, and select from among the members of the
Board a Chair, Vice Chair, Secretary-Treasurer and other officers,
committees, and subcommittees, and to vest in such committees and
subcommittees such responsibilities and authorities as the Board
determines to be appropriate;
(e) To establish regional committees to administer regional
initiatives;
(f) To recommend to the Secretary modifications to the geographical
regions as described in Sec. 1500.40(c);
(g) To establish working committees of persons other than Board
members;
(h) To employ persons, other than the members, as the Board
considers necessary to assist the Board in carrying out its duties and
to determine the compensation and specify the duties of such persons;
(i) To prepare and submit for the approval of the Secretary a
budget as described in Sec. 1500.50(a);
(j) To borrow funds necessary for the startup expenses of this
Order;
(k) To develop and carry out research, education, and promotion
programs and projects relating to concrete masonry products, and to pay
the costs of such programs and projects with assessments collected
under Sec. 1500.51 and other income of the Board as provided under
Sec. 1500.50(j) and Sec. 1500.62;
(l) To enter into contracts or agreements which must be approved by
the Secretary before becoming effective, for the development and
carrying out of programs or projects of research, education, and
promotion relating to concrete masonry, including with manufacturer
associations or other entities as considered appropriate by the
Secretary;
(m) To develop programs and projects, and enter into contracts or
agreements related thereto, which must be approved by the Secretary
before becoming effective, targeted specifically toward the Geographic
Regions described in Sec. 1500.40(c) to be recommended by the relevant
regional committees for marketing and research projects to benefit
manufacturers in such Geographic Regions pursuant to the goals of any
programs or projects as set forth under this Order. The contracts or
agreements related to such programs and projects as described in this
Sec. 1500.46(m) shall be subject to the requirements of all contracts
or agreements described in Sec. 1500.46(l);
(n) To keep minutes, books, and records that reflect the actions
and transactions of the Board, and promptly report minutes of each
Board meeting to the Secretary;
(o) To maintain such records and books and prepare and submit such
reports and records from time to time to the Secretary as the Secretary
may prescribe and to make the records available to the Secretary for
inspection and audit; to make appropriate accounting with respect to
the receipt and disbursement of all funds entrusted to it; and to keep
records that accurately reflect the actions and transactions of the
Board;
(p) To cause its books to be audited by a certified public
accountant at the end of each fiscal year and at such other times as
the Secretary may request, and to submit a report of the audit directly
to the Secretary;
(q) To give the Secretary the same notice of meetings of the Board
and committees as is given to members, including committee members if
committee members are not members of the Board, in order that the
Secretary's representative(s) may attend such meetings, and to keep and
report minutes of each meeting of the Board and all committees to the
Secretary;
(r) To furnish to the Secretary any information or records that the
Secretary may request;
(s) To receive, evaluate, and report to the Secretary all
complaints of violations of this Order;
(t) To recommend to the Secretary such amendments to this Order as
the Board considers appropriate;
(u) To recommend adjustments to the assessments as provided in this
Order;
(v) To notify manufacturers of all Board meetings through press
releases or other means;
(w) To invest assessments collected under this Order in accordance
with Sec. 1500.50; and
(x) To periodically prepare and make available to the public and
manufacturers reports of its activities and, at least once each fiscal
period, to make public an accounting of funds received and expended.
Sec. 1500.48 Prohibited activities.
(a) The Board shall not engage in any program or project to, nor
shall any funds received by the Board under the Act be used to:
(1) Influence legislation, elections, or governmental action;
(2) engage in an action that would be a conflict of interest;
(3) engage in advertising that is false or misleading;
(4) engage in any promotion, research, or education that would be
disparaging to other construction materials; or
(5) engage in any promotion or project that would benefit any
individual manufacturer.
(b) Paragraph (a) does not preclude:
(1) The development and recommendation of amendments to the Order;
(2) the communication to appropriate government officials of
information relating to the conduct, implementation, or results of
research, education, and promotion activities under the Order except
communications described in paragraph (a)(1); or
(3) any lawful action designed to market concrete masonry products
directly to a foreign government or political subdivision of a foreign
government.
Expenses and Assessments
Sec. 1500.50 Budget and expenses.
(a) Prior to the beginning of each fiscal year, and during the
fiscal year as may be necessary, the Board shall prepare and submit to
the Secretary for approval a budget for the fiscal year covering its
anticipated expenses and disbursements in administering this Order.
Such budget shall be deemed approved if the Secretary fails to approve
or reject the budget within 60 days of receipt, unless the Secretary
proposes to the Board and to Congress, reasonable justification for the
delay and provides a reasonable date by which approval or disapproval
will be made. The Department may provide such justification in any
written format.
(b) Each such budget shall include:
(1) A statement of objectives and strategy for each program, plan,
or project;
(2) A summary of anticipated revenue, with comparative data for at
least one preceding year (except for the initial budget);
(3) A summary of proposed expenditures for each program, plan or
project; and
(4) Staff and administrative expense breakdowns, with comparative
data for at least one preceding year (except for the initial budget).
(b) Each budget shall provide adequate funds to defray its proposed
expenditures.
(c) Subject to this section, any amendment or addition to an
approved budget must be approved by the Secretary, including shifting
funds from one program or project to another. A de minimis shift of
funds from one
[[Page 52075]]
approved category to another, and not exceeding 10% of the funds in
either category, which does not cause an increase in the Board's
approved budget and which is consistent with governing bylaws need not
have prior approval by the Secretary. If the Secretary fails to approve
or reject a budget, or an amendment or addition to an approved budget,
within 60 days of receipt, such budget shall be deemed approved, unless
the Secretary provides to the Board and to Congress, in writing,
reasonable justification for the delay and provides a reasonable date
by which approval or disapproval will be made. The Department may
provide such justification in any written format.
(d) The Board is authorized to incur such expenses as the Secretary
finds are reasonable and likely to be incurred by the Board for its
maintenance and functioning, and to enable it to exercise its powers
and perform its duties in accordance with the provisions of this Order.
Such expenses shall be paid from funds received by the Board.
(e) Limitations on obligation of funds:
(1) In each fiscal year, through fiscal year 2030, the Board may
not obligate an amount greater than the sum of--
(i) 73 percent of the amount of assessments estimated to be
collected under 1500.51 in such fiscal year (except for fiscal years
2028 and 2029, for which the amounts estimated to be collected shall be
62 percent of the amount of assessments actually collected in the most
recent fiscal year for which an audit report has been submitted as of
the beginning of the fiscal year for which the amount be obligated is
being determined);
(ii) 73 percent of the amount of assessments actually collected
under 1500.51 in the most recent fiscal year for which an audit report
has been submitted as of the beginning of the fiscal year for which the
amount that may be obligated is being determined, less the estimate
made pursuant to paragraph (e)(1) of this section for such most recent
fiscal year; and
(iii) amounts permitted in preceding fiscal years to be obligated
that have not been obligated.
(2) Assessments collected in excess of the amount permitted to be
obligated in a fiscal year shall be deposited in an escrow account
until the end of fiscal year 2030.
(3) Prior to the end of fiscal year 2030, the Board may not
obligate, expend, or borrow against amounts deposited in the escrow
account. Any interest earned on such amounts shall be deposited in the
escrow account and shall be unavailable for obligation until the end of
fiscal year 2030.
(f) With approval of the Secretary, the Board may borrow money for
the payment of administrative expenses, subject to the same fiscal,
budget and audit controls as other funds of the Board. Any funds
borrowed by the Board shall be expended only for startup costs and
capital outlays.
(g) The Board shall reimburse the Secretary for all expenses
incurred by the Secretary in the implementation, administration and
supervision of this Order, including all referendum costs in connection
with this Order.
(h) Following the third fiscal year of operation of the Board, the
total cost of collection of expenses and administrative staff incurred
by the Board during any fiscal year shall not exceed 10 percent of the
projected total assessments to be collected and other income received
by the Board for that fiscal year after any fees owed to the Department
are paid. Reimbursements to the Secretary required under paragraph (g)
of this section are excluded from this limitation on spending.
(i) Pending disbursement of assessments and all other revenue under
a budget approved by the Secretary, the Board may invest assessments
and all other revenues collected under this section in:
(1) Obligations of the United States or any agency of the United
States;
(2) General obligations of any state or any political subdivision
of a state;
(3) Interest bearing accounts or certificates of deposit of
financial institutions that are members of the Federal Reserve System;
or
(4) Obligations fully guaranteed as to principal interest by the
United States.
(j) Investment income and revenue earned under paragraph (i) are
earnings obtained from assessments that are subject to budget approval
under paragraph (a).
Sec. 1500.51 Assessments.
(a) The collection of assessments on concrete masonry units will be
the responsibility of the manufacturer who sells the concrete masonry
units. There shall be an assessment on the first sale of concrete
masonry units only and not on subsequent sales of concrete masonry
units already assessed. The manufacturer will be required to collect
and remit its individual assessments no less than quarterly.
Manufacturers shall identify the total amount due in assessments on all
sales receipts, invoices or other commercial documents of sale as a
result of the sale of concrete masonry units. Within 180 days of their
initial meeting, the Board will provide for review and approval by the
Secretary a proposed compliance program and its plan to verify
compliance with the Act. The compliance program will outline the way
the Board will receive assessments, how they will verify compliance,
determine the best method to track sales, and how to document all
actions.
(b) Such assessments shall be levied at a rate of $0.01 per
concrete masonry unit sold by a manufacturer. The Board may make
assessments effective as of the effective date of this Order.
Submission of funds may be made to the Board within 60 days of the end
of the first quarter after the Board is established; thereafter
submission of funds will be to the board within 60 days of the end of
each quarter.
(c) At any time following the conduct of the initial referendum
conducted pursuant to this Order, the assessment rate will be reviewed
by the Board and, upon the affirmative vote of two-thirds of voting
members of the Board, may be modified; provided that the assessment
rate may be raised to a maximum of $0.05 cents per unit, that only one
increase may be implemented in any one-year period, and each individual
increase may not exceed $0.01.
(d) Not less than 50 percent of the assessments (less
administration expenses) paid by a manufacturer shall be used to
support research, education, and promotion programs and projects in
support of the Geographic Region of the manufacturer.
(e) All assessment payments and reports will be submitted to the
office of the Board quarterly. All quarterly payments are to be
received no later than 60 days after the conclusion of each quarter. A
late payment charge shall be imposed on any manufacturer who fails to
remit to the Board the total amount for which any such manufacturer is
liable on or before the due date established by the Board. In addition
to the late payment charge, an interest charge shall be imposed on the
outstanding amount for which the manufacturer is liable. The rate of
interest and late payment charges shall be specified by the Secretary.
(f) Manufacturers failing to remit total assessments due in a
timely manner may also be subject to actions under Federal debt
collection procedures.
(g) The Board may authorize other organizations to collect
assessments on its behalf with the approval of the Secretary.
(h) The Board shall provide manufacturers submitting assessments
under this Order with the opportunity to apply for rebates on
assessments remitted to the Board for concrete masonry units not
covered by this Order
[[Page 52076]]
and for assessments remitted to the Board for concrete masonry units
sold to a purchaser that subsequently failed to remit payment due to
bankruptcy, bad debt or other reasons causing the money intended to be
collected from such sale to be uncollectible. Those requesting rebates
in such circumstances must provide all necessary documentation as the
Board shall determine.
Sec. 1500.60 Programs and projects.
(a) The Board shall receive and evaluate, or on its own initiative
develop, and submit to the Secretary for approval any program or
project authorized under this Order. Such programs or projects shall
provide for:
(1) The establishment, issuance, effectuation and administration of
appropriate programs for research, education, and promotion with
respect to concrete masonry; and
(2) The establishment and conduct of research with respect to the
image, desirability, use, marketability, quality or production of
concrete masonry products, to the end that the marketing and use of
concrete masonry products may be encouraged, expanded, improved or made
more acceptable and to advance the image, desirability or quality of
concrete masonry product.
(b) No program or project shall be implemented prior to its
approval by the Secretary. Once a program or project is so approved,
the Board shall take appropriate steps to implement it. If the
Secretary fails to approve or reject a contract or agreement for a
program or project within 60 days of receipt, the contract or agreement
shall be deemed approved, unless the Secretary provides to the Board
and to Congress, in writing, reasonable justification for the delay and
provides a reasonable date by which approval or disapproval will be
made. The Department may provide such justification in any written
format. Any such contract or agreement shall provide that:
(1) The contractor or agreeing party shall develop and submit to
the Board a program or project together with a budget or budgets that
shall show the estimated cost to be incurred for such program or
project;
(2) The contractor or agreeing party shall keep accurate records of
all its transactions and make periodic reports to the Board of
activities conducted, submit accounting for funds received and
expended, and make such other reports as the Secretary or the Board may
require;
(3) The Secretary may audit the records of the contracting or
agreeing party periodically;
(4) Any subcontractor who enters into a contract with a Board
contractor and who receives or otherwise uses funds allocated by the
Board shall be subject to the same provisions as the contractor; and
(5) The contract or agreement shall become effective on the
approval of the Secretary.
(c) Each program or project implemented under this Order shall be
reviewed or evaluated periodically by the Board to ensure that it
contributes to an effective program of research, education, or
promotion. If it is found by the Board that any such program or project
does not contribute to an effective program of research, education, or
promotion, then the Board shall, with the approval of the Secretary,
terminate such program or project.
(d) Any educational or promotional activity undertaken with funds
provided by the Board shall include a statement that such activities
were supported in whole or in part by the Board.
(e) Every 2 years the Board shall prepare and make publicly
available a comprehensive and detailed report that includes an
identification and description of all programs and projects undertaken
by the Board during the previous 2 years as well as those planned for
the subsequent 2 years and detail the allocation or planned allocation
of Board resources for each such program or project. Such report shall
also include:
(1) The overall financial condition of the Board;
(2) A summary of the amounts obligated or expended during the 2
preceding fiscal years; and
(3) A description of the extent to which the objectives of the
Board were met according to the metrics required under Sec.
1500.50(a)(1).
Sec. 1500.61 Independent evaluation.
The Board shall authorize and fund an independent evaluation of the
effectiveness of this Order and other programs conducted by the Board
beginning five years after October 5, 2018 and every 3 years
thereafter. The Board shall submit to the Secretary, and make available
to the public, the results of each periodic independent evaluation
conducted under this paragraph.
Sec. 1500.62 Patents, copyrights, trademarks, information,
publications, and product formulations.
Ownership and allocation of rights to patents, copyrights,
inventions, or publications, developed through the use of non-Federal
funds remitted to the Board under the Order shall be determined by
written agreement between the Board and the party(ies) receiving funds
for the development of such inventions, patents, copyrights or
publications.
Reports, Books, and Records
Sec. 1500.70 Reports.
(a) Each manufacturer subject to this Order may be required to
provide to the Board periodically such information as may be required
by the Board, with the approval of the Secretary, which may include but
not be limited to the following:
(1) Number and type of concrete masonry units manufactured;
(2) Number and type of concrete masonry units on which an
assessment was paid;
(3) Name and address of the manufacturer; and
(4) Date assessment was paid on each concrete masonry unit sold.
(b) All reports required under this Sec. 1500.70 are due to the
Board 60 days after the end of each quarter.
(c) All reports or information submitted pursuant to this paragraph
shall be subject to the confidentiality restrictions in Sec. 1500.72.
Sec. 1500.71 Books and records.
Each manufacturer subject to this Order shall maintain and make
available for inspection by the Secretary such books and records as are
necessary to carry out the provisions of this Order and the regulations
issued thereunder, including such records as are necessary to verify
any reports required. Such records shall be retained for at least 7
years beyond the fiscal period of their applicability.
Sec. 1500.72 Confidential treatment.
(a) Trade secrets and commercial or financial information that is
privileged or confidential obtained from books, records, or reports
under the Act, this Order, and the regulations issued thereunder shall
be kept confidential by all persons, including all employees and former
employees of the Board, all officers and employees and former officers
and employees of contracting and subcontracting agencies or agreeing
parties having access to such information. Such information shall not
be available to Board members or manufacturers. Only those persons
having a specific need for such information to effectively administer
the provisions of this Order shall have access to such information.
Such information may be disclosed only if the Secretary considers the
information relevant; and the information is revealed in a judicial
proceeding or administrative hearing brought at the
[[Page 52077]]
direction or on the request of the Secretary or to which the Secretary
or any officer of the Department is a party. Any officer, employee, or
agent of the Department of Commerce or any officer, employee, or agent
of the Board who willfully violates this paragraph shall be fined not
more than $1,000 and imprisoned for not more than 1 year, or both.
Nothing in this section shall be deemed to prohibit:
(1) The issuance of general statements based upon the reports of
the number of persons subject to this Order or statistical data
collected therefrom, which statements do not identify the information
furnished by any person; and
(2) The publication, by direction of the Secretary, of the name of
any person who has been adjudged to have violated this Order, together
with a statement of the particular provisions of this Order violated by
such person.
(b) For any officer, employee, or agent of the Department of
Commerce, these provisions are consistent with and do not supersede,
conflict with, or otherwise alter any obligations, rights, or
liabilities created by existing statute or Executive Order relating to
classified information, communications to Congress, the reporting to an
Inspector General of a violation of any law, rule, or regulation, or
mismanagement, a gross waste of funds, an abuse of authority, or a
substantial and specific danger to public health or safety, or any
other whistleblower protection. The definitions, requirements,
obligations, rights, sanctions, and liabilities created by controlling
Executive Orders and statutory provisions are incorporated into this
Order and are controlling.
Miscellaneous
Sec. 1500.80 Right of the Secretary.
All fiscal matters, programs or projects, rules or regulations,
reports, or other actions proposed and prepared by the Board shall be
submitted to the Secretary for approval.
Sec. 1500.81 Referenda.
(a) A referendum will be held to determine whether manufacturers
favor enactment of this Order. A manufacturer shall be considered
eligible to vote if the manufacturer has manufactured concrete masonry
products during a period of at least 180 days prior to the first day of
the period during which voting in the referendum will occur. For the
initial referendum, an eligible person is a manufacturer of concrete
units that is subject to the initial rate of assessment in Sec.
1500.51. Each manufacturer eligible to vote in the referendum shall be
entitled to one vote. This Order shall become effective if approved by
a majority of manufacturers voting who also represent a majority of the
machine cavities in operation of those manufacturers voting in the
referendum.
(b) After the initial referendum, the Secretary shall conduct a
referendum upon the request of the Board, or effective beginning on the
date that is 5 years after the date of approval of this Order and at 5-
year intervals thereafter, by petition from not less than 25% of
manufacturers eligible to vote. Each manufacturer eligible to vote in
subsequent referenda shall be entitled to one vote. For any new
proposed order, voter eligibility will be based on the scope of such
proposed order. This Order shall continue if approved by a majority of
manufacturers voting who also represent a majority of the machine
cavities in operation of those manufacturers voting in the referendum.
Sec. 1500.82 Suspension or termination.
(a) The Secretary shall suspend or terminate an order or a
provision of an order if the Secretary finds that an order or provision
of an order obstructs or does not tend to effectuate the purpose of the
Act, or if the Secretary determines that the order or a provision of an
order is not favored by a majority of all votes cast in the referendum
as provided in Sec. 1500.81. If the Secretary suspends or terminates a
provision of an order, the order remains in effect minus the suspended
or terminated provision.
(b) If, as a result of a referendum conducted under Sec. 1500.81
of this Order, the Secretary determines that the Order is not approved,
the Secretary shall:
(1) Not later than 180 days after making the determination, suspend
or terminate collection of assessments under this Order; and
(2) As soon as practical, suspend or terminate activities under
this order in an orderly manner.
Sec. 1500.83 Effect of termination or amendment.
Unless otherwise expressly provided by the Secretary, the
termination of this Order, or the issuance of any amendment to either
thereof,\1\ shall not:
---------------------------------------------------------------------------
\1\ As noted previously, the Department intends to clarify this
language in any final order.
---------------------------------------------------------------------------
(a) Affect or waive any right, duty, obligation or liability which
shall have arisen or which may thereafter arise in connection with any
provision of this Order or any regulation issued thereunder;
(b) Release or extinguish any violation of this Order or any
regulation issued thereunder; or
(c) Affect or impair any rights or remedies of the United States,
or of the Secretary or of any other persons, with respect to any such
violation.
Sec. 1500.84 Notice and advance registration.
Not later than 30 days before a referendum is to be conducted under
this Order, the Secretary shall notify all manufacturers of the period
during which the referendum will occur through publication in the
Federal Register. The notice shall explain any registration and voting
procedures. A manufacturer who chooses to vote in any referendum
conducted under this Order shall register with the Secretary prior to
the voting period.
Sec. 1500.85 Personal liability.
No member or employee of the Board shall be held personally
responsible, either individually or jointly with others, in any way
whatsoever, to any person for errors in judgment, mistakes or other
acts, either of commission or omission, as such member or employee,
except for acts of dishonesty or willful misconduct.
Sec. 1500.86 Separability.
If any provision of this Order is declared invalid or the
applicability thereof to any person or circumstances is held invalid,
the validity of the remainder of this Order or the applicability
thereof to other persons or circumstances shall not be affected
thereby.
Sec. 1500.87 Amendments.
The Secretary may, from time to time, amend an order. Amendments to
this Order may be proposed from time to time by the Board or by any
interested person affected by the provisions of the Act, including the
Secretary. The provisions of the Act applicable to an order shall be
applicable to any amendment to an order.
Sec. 1500.88 OMB control number.
The control numbers assigned to the information collection request
in this subpart by the Office of Management and Budget pursuant to the
Paperwork Reduction Act of 1995, 44 U.S.C. Chapter 35, is OMB control
number [To be added upon OMB approval of the associated information
collection request].
Dated: August 6, 2020.
Kenneth White,
Senior Policy Analyst, Under Secretary for Economic Affairs.
[FR Doc. 2020-17515 Filed 8-21-20; 8:45 am]
BILLING CODE 3510-20-P
