General Updates and Elimination of Certain TAAF and PWEDA Regulations
| Citation | 84 FR 42831 |
| Record Number | 2019-17710 |
| Published date | 19 August 2019 |
| Court | Economic Development Administration |
Federal Register, Volume 84 Issue 160 (Monday, August 19, 2019)
[Federal Register Volume 84, Number 160 (Monday, August 19, 2019)]
[Proposed Rules]
[Pages 42831-42842]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-17710]
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DEPARTMENT OF COMMERCE
Economic Development Administration
13 CFR Parts 302 and 315
[Docket No.: 170830844-9318-01]
RIN 0610-AA80
General Updates and Elimination of Certain TAAF and PWEDA
Regulations
AGENCY: Economic Development Administration, U.S. Department of
Commerce.
ACTION: Notice of proposed rulemaking, request for public comment.
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SUMMARY: The Economic Development Administration (``EDA''), U.S.
Department of Commerce (``DOC''), is publishing this notice of proposed
rulemaking (``NPRM'') to request public comment on proposed updates to
the agency's regulations implementing the Trade Adjustment Assistance
for Firms (``TAAF'') provisions of the Trade Act of 1974, as amended
(``Trade Act''), and the Public Works and Economic Development Act of
1965, as amended (``PWEDA''). The proposed changes to the TAAF program
regulations would clarify the process for import-impacted U.S.
manufacturing, oil and natural production and service firms to obtain
technical assistance--identified in the Trade Act as ``adjustment
assistance''--through the TAAF program, reorganize the regulations to
make them easier to read and understand, incorporate best practices,
and bring the regulations into closer alignment with the program's
statutory requirements. The result will be to ease the burden on firms
seeking adjustment assistance through the TAAF program and make it
easier for Trade Adjustment Assistance Centers (``TAACs'') to work with
firms. EDA also proposes the elimination of certain TAAF and PWEDA
regulations that are unnecessary or duplicative because they describe
requirements already established in other regulations or award
documentation.
DATES: Written comments on this NPRM must be submitted by September 18,
2019.
ADDRESSES: Comments on this NPRM may be submitted through any of the
following methods:
Federal eRulemaking Portal: http://www.regulations.gov.
Follow the instructions for submitting comments. All comments received
are a part of the public record and will generally be posted for public
viewing on www.regulations.gov without change. All personal identifying
information (e.g., name, address, etc.), confidential business
information, or otherwise sensitive information submitted voluntarily
by the sender will be publicly accessible. EDA will accept anonymous
comments (enter ``N/A'' in the required fields if you wish to remain
anonymous).
Email: [email protected]. Include ``Comments on EDA's
regulations'' and Docket No. 170830844-9318-01 in the subject line of
the message.
Mail: Office of the Chief Counsel, Economic Development
Administration, U.S. Department of Commerce, 1401 Constitution Avenue
NW, Suite 72023, Washington, DC 20230. Please indicate ``Comments on
EDA's regulations'' and Docket No. 170830844-9318-01 on the envelope.
FOR FURTHER INFORMATION CONTACT: Ryan Servais, Attorney Advisor, Office
of the Chief Counsel, Economic Development Administration, U.S.
Department of Commerce, 1244 Speer Boulevard, Suite 431, Denver, CO
80204; telephone: (303) 844-4403.
SUPPLEMENTARY INFORMATION:
Background
Through strategic grant investments that foster job creation and
attract private investment, EDA supports development in economically
distressed areas of the United States to prepare these areas for growth
and success in the worldwide economy.
EDA is publishing this NPRM to request public comments on proposed
updates to the agency's regulations implementing the TAAF program (Part
I) and PWEDA (Part II). These changes would ease the burden on firms
and grantees by eliminating unnecessary and duplicative regulations and
clarify and reorganize the regulations to make them easier to
understand.
The proposed updates would also incorporate best practices. For
example, EDA is proposing to build into the definition of
``subsidiary'' language that would recognize independent subsidiaries
as eligible to apply for assistance separately from the firm that has
acquired them. This change is in response to a growing number of
petitions by firms that have been acquired before or after filing a
petition for assistance, while continuing to operate independently. In
addition, EDA proposes to add a requirement that firms must begin
implementation of their Adjustment Proposal within six months after the
Proposal is approved by EDA. Firms that do not begin implementation
within six months after approval must update, re-submit their
Adjustment Proposal, and request re-approval before any Adjustment
Assistance may be provided. EDA also proposes to incorporate changes
that would enable firms to amend their Adjustment Proposals within two
years of EDA approval and that would require firms to complete
implementation of the Adjustment Proposals within five years of
approval. Furthermore, the regulations would require firms that are
transferred, sold, or otherwise acquired by another firm, during this
five-year period, to notify EDA, which will make a determination
regarding the continued eligibility of the petitioner firm. These are
existing best practices and help to ensure that Adjustment Proposals
reflect current conditions and are maximally effective.
These proposed changes would also align the regulations more
closely with statutory requirements. Specifically, EDA proposes to
refer to imported articles or services that compete with and are
substantially equivalent to the petitioning firm's as ``directly
competitive or like,'' as written in the Trade Act, rather than simply
``directly competitive.'' In addition, EDA proposes to clarify all
references to ``days'' as ``calendar days,'' to reflect this usage in
the Trade Act, a change that would also speed up the time within which
EDA is required to make determinations regarding firm eligibility and
assistance.
Additionally, because this rule would remove certain regulations
and will make it easier for firms and EDA grantees to comply with the
requirements for the TAAF and EDA grant programs, it is considered a
``deregulatory action'' pursuant to the April 5, 2017, OMB guidance
memorandum implementing Executive Order 13771.
Part I: Updates to TAAF Program Regulations
Trade Act Background
Authorized under Chapter 3 of title II of the Trade Act of 1974 (19
U.S.C. 2341-2355), the TAAF program assists import-impacted U.S.
manufacturing, oil and natural gas production, and service firms with
developing and
[[Page 42832]]
implementing projects to regain global competitiveness, expand markets,
strengthen operations, and increase profitability, thereby increasing
U.S. jobs.
The TAAF program provides cost-sharing technical assistance to
eligible import-impacted U.S. manufacturing, oil and natural gas
production, and service firms in all 50 States, the District of
Columbia and the Commonwealth of Puerto Rico. Technical assistance is
provided through a nationwide network of 11 TAACs, which are non-
profits or university-affiliated.
TAACs provide eligible firms with customized assistance from
industry experts knowledgeable about the unique needs, challenges, and
opportunities facing industries in their respective regions. Firms work
with the TAACs to apply for certification of eligibility for TAAF
assistance. Firms demonstrate their eligibility by documenting that
they have experienced a decline in sales or a decline or impending
decline in employment or worker hours, and that an increase of imports
of directly competitive goods or services contributed importantly to
such declines. EDA then renders a decision regarding the firms'
eligibility.
The TAAC works closely with eligible firms' management to identify
the firms' strengths and weaknesses and then develop a customized
business recovery plan, called an Adjustment Proposal (AP), designed to
stimulate recovery and growth. The TAAF program pays up to 75 percent
of the costs of developing the AP. EDA reviews firms' APs and
determines whether or not to approve them. When the AP has been
approved, company management and TAAC staff jointly identify
consultants with the specific expertise needed to help the firm
implement the AP. For consultant costs that are above the acquisition
threshold for sole source contracts, selection is made through a
competitive procurement process. The TAACs and firms then enter into a
contract with the private consultants, and the TAACs pay up to 75
percent of the costs of the consultants.
Overview of Proposed Changes to the TAAF Regulations
The discussion that follows presents the proposed changes by
subpart letter and section number, with an explanation for each
proposal.
Subpart A
EDA proposes no changes to the designation or heading of this
subpart. EDA proposes to transfer Sec. Sec. 315.4 and 315.5 from
Subpart A to Subpart B. This proposed change would retain all general
provisions (purpose and scope, definitions, and Confidential Business
Information) within Subpart A, while consolidating those regulations
regarding TAAC selection, operation, role, and coverage within Subpart
B.
Section 315.1
EDA proposes replacing this section with a new programmatic
description of TAAF's purpose. The revised section will more clearly
lay out the process by which EDA executes its responsibilities
concerning the TAAF program, as delegated by the Secretary of Commerce,
and the process by which firms work with TAACs to request and obtain
Adjustment Assistance. EDA also proposes adding a citation to those
sections of the Trade Act of 1974 which establish the responsibilities
and requirements associated with the TAAF program.
Section 315.2
EDA proposes a minor wording change to the introduction to the
definitions, as well as changes to the definitions identified below.
Adjustment Assistance
EDA proposes three revisions to the definition of Adjustment
Assistance. First, EDA proposes to remove the reference to ``or
industries.'' As explained further in the discussion of the changes to
section 315.17, EDA proposes to eliminate its regulations related to
the provision of trade adjustment assistance to industries. EDA has
historically not provided separate industry-wide assistance programs
because firms within impacted industries have solicited help through
TAAF on an individual basis and because there has been no demand for
industry-wide assistance. In addition, EDA provides expedited review of
petitions and Adjustment Plans from firms within impacted industries.
When the U.S. International Trade Commission (ITC) makes an injury
determination, in accordance with Chapter 3 of the Trade Act, EDA
provides expedited consideration to petitions by firms in the affected
industry, as well as expedited assistance in preparing and processing
Adjustment Proposal applications to such firms. EDA believes this
individualized approach has been effective in facilitating adjustments
within both firms and industries. Removing regulations that reference
trade adjustment assistance to industries will help prevent potential
confusion regarding the availability of a parallel industry program. In
the event that EDA does determine it is appropriate to provide trade
adjustment assistance for industries, EDA will promulgate new
regulations to implement the program.
Second, EDA proposes to revise the definition to clarify that
Adjustment Assistance refers to technical assistance provided by the
TAACs. The current regulation is ambiguous and could be interpreted
that EDA provides the technical assistance directly, which is not the
case. Third, EDA proposes adding to the definition a statement that EDA
determines what type of assistance is provided and to incorporate a
list of the types of assistance that this may include: Preparing a
firm's petition for certification of eligibility, developing an
Adjustment Proposal, and implementing an Adjustment Proposal.
Adjustment Proposal
EDA proposes revising the definition for Adjustment Proposal,
clarifying that the Adjustment Proposal is a firm's plan for improving
its competitiveness in the marketplace, consistent with the intent of
the TAAF program as established in the Trade Act. The current
regulations state that the purpose of an Adjustment Proposal is to
improve the firm's economic situation, a less clear goal not linked to
the purposes of the Trade Act.
Decreased Absolutely
EDA proposes a minor change to the definition of Decreased
Absolutely to add language clarifying that a firm's sales or production
must have declined by a minimum of five percent relative to its sales
or production during the applicable time period and that the decline is
independent of industry or market fluctuations and relative only to the
previous performance of the firm unless EDA determines that such
limitations would not be consistent with the purposes of the Trade Act.
While it is implied in the existing regulations that all three of these
factors must be present to constitute an absolute decrease in a firm's
sales or production, EDA believes this minor revision will provide
clear confirmation of this requirement.
Directly Competitive
EDA proposes revising the defined term Directly Competitive to add
the words ``or Like'' to the end, such that the term would be Directly
Competitive or Like. This change would more closely align this term
with the terminology of the Trade Act. EDA proposes further revising
this definition by adding language that clarifies the linkage between
this definition and the reference to firms that engage in exploring,
drilling, or producing oil or natural gas. By adding the phrase ``For
[[Page 42833]]
the purposes of this term,'' before the final sentence in this
definition, EDA reinforces the requirement in Section 251 of the Trade
Act that firms that engage in these types of activities be considered
as producing articles that are directly competitive with imported oil
and natural gas for the purposes of TAAF eligibility.
Firm
EDA proposes revising the definition of Firm to correct the
citation to the section of the Trade Act that defines this term. In
addition, EDA proposes capitalizing the term, ``Unjustifiable
Benefits,'' as referenced in this definition. This change is the result
of EDA's proposal to include a definition for Unjustifiable Benefits,
as described below. EDA also proposes further revising this definition
by adding to the sub-definition of Subsidiary, which is included as a
category of firm that may be considered jointly with another firm that
is requesting Adjustment Assistance pursuant to TAAF in an effort to
prevent Unjustifiable Benefits. EDA proposes to qualify the definition
of Subsidiary by adding an explanation that a firm acquired by another
firm but which operates independently of the acquiring firm is
considered an Independent Subsidiary and may be considered separately
from the acquiring firm as eligible for Adjustment Assistance. This
change reflects existing practice and addresses a growing trend in
petitions requesting Adjustment Assistance for firms that have been
acquired by another firm but continue to operate independently after
the acquisition, generally retaining the same management, maintaining
control over management decisions, and otherwise continuing operations
without significant change.
Increase in Imports
EDA proposes revising the definition of Increase in Imports by
making minor wording changes for increased clarity. EDA proposes
further modification to this definition by moving the second sentence
of this definition to the revised Subpart C (Certification of firms) as
a new paragraph (c) in Sec. 315.6 (Certification Requirements). EDA
believes this sentence more appropriately belongs in this Subpart C as
a description of one way for a firm to demonstrate that it meets the
eligibility requirements for Certification to apply for Adjustment
Assistance. The sentence provides that a firm may submit certifications
from a firm's customers that account for a significant percentage of
the firm's decrease in sales or production, that the customers
increased their purchase of imports of Directly Competitive or Like
Articles or Services from a foreign country.
Partial Separation
EDA proposes changing the definition of Partial Separation by
replacing language denoting that this definition is with respect to any
employment in a firm with language that clarifies that a Partial
Separation occurs when there has been no increase in overall employment
at the firm and either of the conditions currently described in this
definition exist: (1) A reduction in an employee's work hours to 80
percent or less of the employee's average weekly hours during the year
of such reductions as compared to the preceding year; or (2) a
reduction in the employee's weekly wage to 80 percent or less of his/
her average weekly wage during the year of such reduction as compared
to the preceding year. EDA occasionally receives petitions submitted by
firms whose overall employment figures have increased within the
periods of time in question and which, nonetheless, assert that there
has been a Partial Separation with regards to a certain portion of
their workforce's work hours or weekly wages. EDA believes that this
revision should resolve the apparent confusion caused by the current
wording and clarify that a firm does not meet the eligibility criteria
if its overall employment has increased during the relevant time
period.
Service Sector Firm
EDA proposes revising the definition of Service Sector Firm to
remove the last two sentences of that definition because they are
already included in the definition of firm. The first superfluous
sentence states that when a Service Sector Firm owns or controls other
Service Sector Firms, those firms may be considered a single Service
Sector Firm for the purposes of requesting Adjustment Assistance when
they furnish Directly Competitive or Like services or are exerting
essential economic control over one or more servicing facilities. The
second superfluous sentence notes that these firms may be Predecessor,
Successor, Affiliate, or Subsidiary Firms as defined in the definition
of firm.
Total Separation
EDA proposes streamlining and clarifying the definition of Total
Separation by removing the phrase ``with respect to any employment in a
firm'' and adding the words ``in a firm'' after ``the laying off or
termination of employment of an employee.''
Unjustifiable Benefits
As noted above, EDA also proposes adding a definition for
Unjustifiable Benefits. Under this new definition, Unjustifiable
Benefits describe Adjustment Assistance inappropriately accruing to the
benefit of (1) other firms that would not otherwise be eligible when
provided to a firm or (2) any predecessor or successor firm, or any
affiliated firm controlled or substantially beneficially owned by
substantially the same person, rather than treating these entities as a
single firm. EDA believes that this is an important concept that should
be fully explained to help firms understand TAAF eligibility
requirements, particularly when a firm has a relationship through
ownership or control by another firm.
Section 315.3
EDA proposes no revisions to this section.
Subpart B
EDA proposes revising this subpart to consolidate and clarify all
regulations regarding TAAC selection, operations, and coverage. The
revised Subpart B, entitled ``TAAC Provisions,'' would be inserted
after Sec. 315.3 and would include revised Sec. Sec. 315.4 and 315.5,
which would be transferred to Subpart B from Subpart A.
Section 315.4
EDA proposes revising the heading of Sec. 315.4 from ``Eligible
applicants'' to ``TAAC Selection and Operation.'' EDA also proposes
revising paragraph (a) of this section to better describe the TAAC
selection process by replacing the words ``The following entities may
apply for assistance to operate a TAAC'' with ``EDA solicits
applications from organizations interested in operating a TAAC through
Notice of Funding Opportunity announcements laying out selection and
award criteria. The following entities are eligible to apply:''. EDA
also proposes replacing ``or'' with ``and'' after subparagraph (2) to
clarify that all of the types of entities listed in paragraph (a) are
eligible to apply to be selected as a TAAC, including universities or
affiliated organizations, States or local governments, and non-profit
organizations.
EDA proposes revising paragraph (b) of this section to replace the
existing language, which lists the types of organizations assisting or
representing industries in which a substantial number of firms or
workers have been certified as eligible to apply for Adjustment
Assistance under the Trade Act, with language explaining that
[[Page 42834]]
TAACs are awarded cooperative agreements that are subject to all
Federal laws and to Federal, Department, and EDA policies, regulations,
and procedures applicable to Federal financial assistance awards,
including 2 CFR part 200, Uniform Administrative Requirements, Cost
Principles, and Audit Requirements for Federal Awards, and that the
TAACs work closely with EDA and import-impacted firms. EDA believes
this new language clarifies the basis for the relationship between EDA
and the TAACs and clarifies the legal, policy, and procedural criteria
that govern this relationship.
Section 315.5
EDA proposes revising the heading of this section from ``TAAC
scope, selection, evaluation and awards'' to ``The Role and Geographic
Coverage of the TAACs'' to more accurately reflect the focus of this
section, particularly in the more streamlined version of the
regulations being proposed by EDA in this Notice. EDA proposes revising
paragraph (a) of this section by removing the introductory language,
``TAAC purpose and scope,'' as unnecessary. EDA also proposes removing
the numbered subparagraphs from paragraph (a) and, in that same
paragraph, changing the third sentence, which currently reads, in part,
``Information concerning TAACs serving particular areas may be obtained
. . .'' from various EDA and TAAC websites. EDA proposes to revise that
sentence to read: ``Information concerning TAACs and their coverage
areas may be obtained . . .'' EDA anticipates that this change will
clarify that information regarding all of the TAACs service areas,
rather than just particular geographic areas, are available at these
websites.
EDA proposes renumbering subparagraphs (2) and (3) as paragraphs
(b) and (c), respectively. EDA also proposes streamlining newly re-
designated paragraph (c) by removing the words ``providing assistance
to a,'' renumbering subparagraphs (i) and (ii) as (1) and (2),
respectively, and rewording those two subparagraphs as follows: ``(1)
Helping a firm to prepare its petition for eligibility certification;
and (2) Assisting Certified firms with diagnosing their strengths and
weaknesses, and with developing and implementing an Adjustment
Proposal.'' This change should provide enhanced clarity on the types of
Adjustment Assistance a TAAC may provide a firm.
EDA also proposes removing existing paragraphs (b), (c), and (d) in
their entirety. These paragraphs discuss the application and evaluation
process for TAACs to be awarded a cooperative agreement as well as the
award requirements for the cooperative agreements. EDA believes these
paragraphs are unnecessary, as these provisions and requirements would
generally be covered in the Notice of Funding Opportunity used to
announce the availability of funding for TAAC awards.
Subpart C
EDA proposes revising Subpart C to consolidate all regulations
regarding the certification of firms. The revised Subpart C would be
entitled, ``Certification of Firms'' and would include Sec. 315.6
through Sec. 315.10.
Section 315.6
EDA proposes to revise the heading for Sec. 315.6 from ``Firm
eligibility for Adjustment Assistance'' to ``Certification
Requirements'' and revise paragraph (a) to remove the introductory
language. EDA also proposes moving the matching share requirements for
Adjustment Proposals as set forth in current paragraph (c)(2) to the
new Sec. 315.11 (``Adjustment Proposal Process'') in Subpart D
(``Adjustment Proposals''). EDA proposes eliminating the remaining
requirements in Sec. 315.6. These remaining requirements are
duplicative of other regulations in this Part and provide no additional
guidance or clarity to the TAACs or firms. Moreover, EDA proposes
adding to Sec. 315.6(a) a reference to the codified version of the
relevant section of the Trade Act.
In addition to these revisions, as noted above in the discussion
regarding proposed revisions to the definition of Increase in Imports,
EDA proposes adding a new paragraph (c) to this section and moving into
this paragraph the language formerly located in the definition of
Increase in Imports that enabled firms to help demonstrate that they
meet the eligibility requirements for Adjustment Assistance by
submitting certification from the firm's customers that account for a
significant percentage of the firms' decrease in sales or production,
that the customers increased their purchase of imports of Directly
Competitive or Like Articles or Services from a foreign country. A
comma has been added to this sentence after the word ``production'' to
increase clarity. EDA proposes further adding to this new paragraph (c)
a sentence specifying that such certification from a firm's customer
must be submitted directly to a TAAC or to EDA. EDA believes this
addition will ease some confusion by firms, some of which have
requested their customers to provide such certification directly to the
firms which subsequently pass on the certifications to EDA through the
TAACs. While EDA recognizes the potential sensitivity and challenges
involved with a firm asking one or more of its customers to certify
that the customers have increased their purchase of imports relative to
their purchase from U.S. suppliers, EDA believes that this information
is critical to support claims of import impact. In addition, Section
251(e) of the Trade Act requires these certifications to be made to the
Secretary of Commerce, who has delegated this and the other
responsibilities associated with the TAAF program to EDA.
Section 315.7
EDA proposes re-designating the current Sec. 315.8 as Sec. 315.7
and revising the section heading to capitalize the words ``Petitions''
and ``Certification'' to reflect the use of capitalization in the
headings of the other sections within part 315.
Because of the revisions discussed above, EDA also proposes
revising the cross-reference in paragraph (b)(4) to cite to Sec.
315.6(b), rather than to Sec. 315.7(b). This cross-reference links to
the section describing the data on sales, production, and employment
required to demonstrate a firm has met the established certification
thresholds.
Furthermore, EDA proposes revising paragraph (b)(5) to clarify the
additional requirements for publicly-owned corporations when submitting
financial information as part of their petitions for certification. EDA
proposes revising the paragraph by adding the words, ``in addition''
and ``also'' to clarify that publicly-owned corporations should submit
copies of the most recent Form 10-K annual reports (or Form 10-Q
quarterly reports, as appropriate) filed with the U.S. Securities and
Exchange Commission for the entire period covered by the petition in
addition to the other requirements described in this same paragraph.
EDA also proposes revising paragraph (b)(6) to make clear the
information required regarding a firm's customers. Specifically, EDA
proposes replacing the qualifier that the description relates to the
``major'' customers of the firm with one that identifies the customers
as ``accounting for a significant percent of the firm's decline.'' EDA
proposes further revising this paragraph to clarify that firms should
submit information regarding those customers' purchases or the firm's
unsuccessful bids if there are no customers fitting the description
outlined in this paragraph.
[[Page 42835]]
EDA also proposes revising paragraph (e) by including a citation to
the codified section of the Trade Act set forth in this paragraph and
by updating the cross-reference to the section of part 315 that
discusses certification requirements.
EDA proposes revising paragraph (f) to clarify that, in order to
withdraw a petition for certification, the petitioner must submit a
request for withdrawal before EDA makes a determination regarding
approval or denial of the certification. EDA proposes further revising
this paragraph by updating the cross-reference cited in the second
sentence of paragraph (f), which regards submission of a new petition,
to reflect the re-designation of the section that discusses
certification requirements from Sec. 315.7 to Sec. 315.6.
EDA also proposes revising subparagraphs (1) and (2) in paragraph
(g) of this section. EDA proposes revising subparagraph (1) to add the
word ``requested'' before the word ``material'' in order to make clear
that EDA may request additional material from a firm beyond what was
submitted with the firm's original petition if necessary to make a
determination regarding the firm's eligibility for Adjustment
Assistance. In addition, EDA proposes revising subparagraph (1) to
insert the word ``calendar'' before the word ``days.'' EDA also
proposes making similar revisions to all references to ``days'' found
throughout part 315. EDA proposes these changes to clarify that all
references to ``days'' within part 315 refer to calendar days. The
current regulations are not clear on whether these references to
``days'' are calendar or business days. These revisions will bring the
TAAF regulations into alignment with the Trade Act.
EDA proposes revising subparagraph (2) of paragraph (g) by altering
the final sentence to clarify that firms may not resubmit a petition
within one year from the date of a denial without a waiver from EDA
issued for good cause.
Section 315.8
EDA proposes re-designating the current Sec. 315.9 as Sec. 315.8.
For the reasons discussed above, EDA proposes inserting the word
``calendar'' in front of the word ``days'' in the introductory
paragraph to this section.
EDA proposes revising paragraphs (a) and (c) by replacing the
semicolon at the end of each paragraph with a period to reflect that
each is a complete sentence.
EDA proposes revising paragraph (b)(2) by deleting the word ``its''
and inserting the words ``the requesting party's'' in lieu thereof to
clarify that, when someone other than the petitioner requests a public
hearing on an accepted petition, the requester must include a statement
describing the nature of the requester's interest in the proceedings.
EDA also proposes revising paragraph (d) of this section to clarify
that EDA will publish a notice of a public hearing in the Federal
Register only if EDA has made the determination that the requesting
party has a substantial interest in the hearing. EDA proposes further
revising this paragraph by removing the semicolon and the word ``and''
from the end of the paragraph and adding a period.
Section 315.9
EDA proposes re-designating the current Sec. 315.10 as Sec. 315.9
and revising the section heading to capitalize the words
``Certification'' and ``Benefits'' to reflect the use of capitalization
in the headings of the other sections within part 315.
EDA also proposes revising paragraphs (a), (b), and (d) to replace
the word ``Failure'' at the beginning of each of those paragraphs with
the words ``The firm failed'' to provide clarity regarding which
entity's omission triggers the loss of certification benefits.
In addition, EDA proposes revising paragraphs (a), (b), and (c) to
replace the semicolons at the end of each of those paragraphs with a
period to reflect that these are separate and not cumulative
requirements. For the same reason, EDA proposes to further revise
paragraph (c) by removing the word ``or'' from the end of that
paragraph.
EDA proposes further revising paragraph (d) by adding a comma after
the words ``Adjustment Proposal'' and replacing the word ``where'' with
the word ``and''. This paragraph, as revised, reads: ``(d) The firm
failed to diligently pursue an approved Adjustment Proposal, and five
years have elapsed since the date of certification.''
Section 315.10
EDA proposes re-designating the current Sec. 315.11 as Sec.
315.10 and revising the section heading to capitalize the words
``Final,'' ``Determinations,'' ``Termination,'' and ``Certification,''
to reflect the use of capitalization in the headings of the other
sections within part 315.
EDA proposes revising paragraphs (a) and (b) of this section by
inserting the word ``calendar'' before the word ``days'' for the
reasons mentioned above. EDA proposes further revising paragraph (a) by
updating the cross-references to the regulations regarding EDA's
process for making determinations regarding petitions for
certification. Specifically, EDA proposes changing the two references
in this paragraph from Sec. 315.8(g) to Sec. 315.7(g). EDA proposes
further revising paragraph (b) by adding a reference to the codified
version of the cited section of the Trade Act.
EDA proposes removing the designation of paragraph (d) and adding
the sentence that formerly stood alone as paragraph (d) to the end of
paragraph (c) in this same section. EDA believes this reorganization
would reduce potential confusion by placing all requirements regarding
the steps EDA takes when it terminates a certification, including
notifying the petitioner and stating the reasons for such termination,
in a single paragraph.
Subpart D
EDA proposes no changes to the designation or heading of this
subpart. However, EDA proposes to revise this subpart to include
Sec. Sec. 315.11 and 315.12.
Section 315.11
Section 315.11 would be revised to combine requirements currently
contained in other sections of part 315 and add new language to reflect
best practices. The section heading would be revised to be ``Adjustment
Proposal Process.''
EDA proposes moving paragraphs (a)(2) and (a)(3) from the current
Sec. 315.6 to the revised Sec. 315.11 as paragraphs (a) and (b)
within this section in order to consolidate Adjustment Proposal
procedures within a single section. In addition, within paragraph (a)
of Sec. 315.11, EDA proposes updating the cross-references to those
sections within part 315 that refer to certification requirements and
processing petitions for certification to reflect the changes discussed
above. In line with these changes, the references cited in this
paragraph would change from Sec. Sec. 315.7 and 315.8 to Sec. Sec.
315.6 and 315.7, respectively. In order to more clearly reflect the
requirements of the Trade Act, EDA proposes to move the requirement
established in the current Sec. 315.16(a), which says Adjustment
Proposals must be submitted to EDA for approval within two years after
the date of Certification, to the newly designated Sec. 315.11(a).
In addition to moving the requirements that currently exist in
Sec. 315.6(a)(3) to the revised Sec. 315.11(b), EDA proposes adding
language to these requirements that would require firms to begin
implementation of their approved Adjustment Proposal within six months
after approval. EDA also proposes adding a requirement that firms that
do not begin implementation
[[Page 42836]]
within six months after approval must update and re-submit their
Adjustment Proposal for re-approval before any Adjustment Assistance
may be provided. These additions reflect long-standing practice and
would help firms to ensure that their Adjustment Proposals reflect the
most up-to-date economic conditions and financial situation and,
consequently, that the firms will receive the most effective Adjustment
Assistance.
EDA proposes adding a paragraph (c) to this section that discusses
how EDA will make a determination regarding the Adjustment Proposal no
later than 60 calendar days after receipt of the Adjustment Proposal.
This new language incorporates a requirement in Section 252(b)(2) of
the Trade Act that the Secretary make a determination as soon as
possible after the date on which an application is filed, but in no
event later than 60 days after such date.
EDA also proposes adding a paragraph (d) to this section. EDA
proposes moving the matching share requirements for Adjustment
Assistance from the existing Sec. 315.6(b)(2) to this paragraph. In
addition, EDA proposes adding a sentence stating that certified firms
may request no more than the amount established by EDA for total
Adjustment Assistance over the entire lifetime of the firm. This
proposed addition incorporates current practice, established to ensure
that the maximum number of eligible firms are able to receive
Adjustment Assistance and to encourage certified firms to appropriately
plan and implement their Adjustment Proposals within established
funding limits.
EDA proposes adding a paragraph (e) to this section and specifying
within this paragraph that firms may request EDA approval to amend
their Adjustment Plans within two years from the date of EDA approval
of their initial Adjustment Plans. This new language incorporates
current practice and allows firms to update their Adjustment Plans as
needed within the two-year time frame to address any unexpected changes
in their situation, new information, or a need to re-direct resources
to areas of greatest need.
EDA also proposes adding a paragraph (f) to this section. The
proposed paragraph (f) requires firms to complete implementation of
their Adjustment Plans within five years of EDA approval of their
initial Adjustment Plan. This added language reflects current practice
and EDA's expectation that firms who request Adjustment Assistance are
financially and operationally prepared to engage in the TAAF program
and will implement their Adjustment Plan in a timely way.
EDA proposes adding a paragraph (g) to this section to address what
occurs if a Certified firm is transferred, sold, or otherwise acquired
by another firm during the five-year period established in paragraph
(f). Paragraph (g) requires a Certified firm that is transferred, sold,
or otherwise acquired by another firm during the five-year period of
Adjustment Assistance to notify EDA no later than 30 calendar days
following the transfer, sale, or acquisition. EDA will then make a
determination as to whether the firm remains eligible for Adjustment
Assistance. EDA will make this determination no later than 60 calendar
days following notification by the firm. This new language incorporates
current practice and is designed to resolve any confusion about how
firms and TAACs should handle this type of scenario.
Finally, EDA proposes adding a paragraph (h) to this section.
Paragraph (h) would require firms that receive Adjustment Assistance to
provide data regarding the firms' sales, employment, and productivity
upon completion of the program and each year for the two-year period
following completion. This language incorporates into the regulations
reporting requirements established in Section 255A of the Trade Act,
which requires EDA to report annually to Congress on data regarding the
TAAF program for the preceding fiscal year.
Section 315.12
EDA proposes revising the heading of this section to capitalize the
words ``Proposal'' and ``Requirements'' to reflect the use of
capitalization in the headings of the other sections within part 315.
In addition, as discussed above, EDA proposes eliminating paragraph
(a) of this section after moving the requirement that firms must submit
their Adjustment Proposals to EDA within two years of the date of
certification to Sec. 315.11(a).
As a result of this proposed elimination of paragraph (a), EDA
proposes re-designating the remaining paragraphs such that the existing
paragraph (b) is re-designated paragraph (a), paragraph (c) becomes
paragraph (b), and paragraph (d) becomes paragraph (c).
Subpart E
EDA proposing revising the heading for this subpart to ``Protective
Provisions.'' As revised, Subpart E would include Sec. Sec. 315.13 and
315.14. EDA proposes moving the requirements regarding persons engaged
by firms to expedite petitions and Adjustment Proposals as found in the
current Sec. 315.14 (Certifications) and the requirements regarding
conflicts of interest that are contained the current Sec. 315.15
(Conflicts of interest), both of which are found in the current Subpart
C, to Subpart E. EDA believes this reorganization and new location will
make it easier for firms to read and understand the regulations and
will help clarify that these provisions apply to firms at all stages of
the TAAF process.
Section 315.13
EDA proposes moving the requirements for firms to certify in
writing to EDA the names of any attorneys, agents, and other Persons
engaged by or on behalf of the firm for the purpose of expediting
Petitions for Adjustment Assistance and the fees paid or to be paid to
any such Person, as found in the current Sec. 315.14, to Sec. 315.13.
EDA proposes further revising these requirements by clarifying, in
paragraph (a), that they apply to both Adjustment Assistance and
Adjustment Proposals.
Section 315.14
EDA proposes moving the requirements found in the current Sec.
315.15 to Sec. 315.14. EDA also proposes revising these requirements
by modifying the list of firm representatives subject to the conflicts
of interest requirements to parallel the list of firm representatives
identified in the revised Sec. 315.13. With this revision, Sec.
315.14 applies the conflict of interest requirements to the ``owners,
partners, members, directors or officers'' of the firm, replacing the
prior language applying these requirements to the ``owners, partners,
or officers'' of the firm.
Subpart F
EDA proposes adding Subpart F, entitled ``International Trade
Commission Investigations.'' Subpart F sets forth, through Sec.
315.15--what actions EDA takes when the ITC makes an affirmative
finding under the Trade Act or under sections 705 or 735 of the Tariff
Act regarding injury or threat of injury to an industry.
Section 315.15
EDA proposes revising the heading of this section to ``Affirmative
Findings.'' EDA also proposes removing the designation ``(a)'' from the
first paragraph of this section and eliminating paragraphs (b) and (c)
to reflect the fact that EDA, historically,
[[Page 42837]]
has not provided Adjustment Assistance for the establishment of
industry-wide programs for new product development, export development,
or other uses consistent with the purposes of the Trade Act because
there has been no demand for such programs. As noted above in the
discussion regarding proposed changes to the definition of Adjustment
Assistance in Sec. 315.2, firms within impacted industries have sought
Adjustment Assistance through TAAF on an individual basis rather than
through industry-wide solutions. EDA also provides expedited review of
petitions and Adjustment Plans from firms within industries that have
received an injury determination by the ITC. This individualized
approach enables EDA to support adjustments at the firm level, while
having a cumulative impact at the industry level.
EDA proposes further revising this section by correcting the
citation, within the first paragraph, to read ``section 202(b) of the
Trade Act'' with a lower case (b) as is used in the Trade Act. EDA also
proposes citing to the codified form of the relevant section of the
Trade Act, 19 U.S.C. 2252, within that first paragraph and updating the
paragraph by including a reference to sections 705 and 735 of the
Tariff Act (19 U.S.C. 1671d, 1673d). Furthermore, EDA proposes
replacing within this paragraph the language stating that EDA will
provide to firms in the identified industry assistance in the
preparation and processing of petitions and applications for benefits;
EDA instead will include language establishing notification to the
TAACs and expedited review of petitions and Adjustment Plans from firms
within the specified industry. EDA believes these revisions more
clearly describe the assistance EDA provides to industries in response
to determinations made by the International Trade Commission under the
Trade and Tariff Acts.
Part II: Updates to PWEDA Regulations
PWEDA Background
PWEDA is EDA's organic authority and is the primary legal authority
under which EDA awards grants. Other legal authorities include the
Trade Act and the Stevenson-Wydler Technology Innovation Act of 1980.
Under PWEDA, EDA provides financial assistance to both rural and urban
distressed communities by fostering entrepreneurship, innovation, and
productivity through investments in infrastructure development,
capacity building, and business development in order to attract private
capital investments and new and better jobs to regions experiencing
substantial and persistent economic distress.
Overview of PWEDA Regulations Proposed for Elimination
EDA proposes eliminating certain provisions within part 302 of the
PWEDA regulations that are unnecessary or already established in other
regulations or award documentation. Specifically, EDA is proposing to
eliminate the regulations located at 13 CFR 302.4, 302.5, and 302.14.
These regulations describe: The responsibilities of EDA grant
recipients to maintain records, how information supplied to EDA may be
subject to public release under the Freedom of Information Act or
Privacy Act, how government auditors may need access to various
records, and that grant recipients are subject to the government-wide
relocation assistance and land acquisition policies. These regulations
can be removed because notice is already provided to grant recipients
through other Department of Commerce-wide or government-wide
regulations as well as in specific documentation EDA provides to each
grant recipient. Specifically, recipients of EDA financial assistance
are already subject to the requirements related to the Freedom of
Information Act or Privacy Act currently described in Sec. 302.4
through 15 CFR part 4 and the Standard Terms and Conditions of an EDA
award. Similarly, the relocation and land acquisition policies
currently found in Sec. 302.5 are already applicable to all EDA
financial assistance recipients under government-wide regulations found
at 49 CFR part 24. Finally, the record-keeping requirements currently
located in Sec. 302.14 duplicate the requirements of Section 608 of
PWEDA (42 U.S.C. 3218), 2 CFR 200.333 and 200.336, and the Standard
Terms and Conditions of an EDA award.
In addition, EDA is proposing the elimination of 13 CFR 302.11.
Beginning with the enactment of the original section 502 of PWEDA (42
U.S.C. 3192) in 1998, Congress has required EDA to maintain an economic
development information clearinghouse on matters related to economic
development, economic adjustment, disaster recovery, defense
conversion, and trade adjustment programs and activities. See Public
Law 105-393. With the EDA Reauthorization Act of 2004 (Pub. L. 108-373
(Oct. 27, 2004)), Congress amended section 502 to require EDA to, among
other things, maintain this information clearinghouse online. The
current regulation adds nothing of value to the requirements already in
place under section 502 and consequently should be eliminated.
Classification
Prior notice and opportunity for public comment are not required
for rules concerning public property, loans, grants, benefits, and
contracts (5 U.S.C. 553(a)(2)). EDA's programs, including TAAF, are
financial assistance programs provided through grants and cooperative
agreements. As such, prior notice and an opportunity for public comment
are not required pursuant to 5 U.S.C. 553, or any other law, and the
analytical requirements of the Regulatory Flexibility Act (5 U.S.C. 601
et seq.) are inapplicable. Therefore, a regulatory flexibility analysis
has not been prepared.
Executive Orders No. 12866, 13563, and 13771
This proposed rule was drafted in accordance with Executive Orders
12866, 13563, and 13771. The Office of Management and Budget (OMB) has
determined that this proposed rule is not significant for purposes of
Executive Order 12866 and Executive Order 13563.
This proposed rule is a deregulatory action that has a neutral
effect on the costs to firms, organizations, and all other stakeholders
to comply with the regulations discussed in this NPRM. It is therefore
considered to have a total incremental cost of zero pursuant to the
April 5, 2017, OMB guidance memorandum implementing Executive Order
13771.
Congressional Review Act
This proposed rule is not major under the Congressional Review Act
(5 U.S.C. 801 et seq.).
Executive Order No. 13132
Executive Order 13132 requires agencies to develop an accountable
process to ensure ``meaningful and timely input by State and local
officials in the development of regulatory policies that have
federalism implications.'' ``Policies that have federalism
implications'' is defined in Executive Order 13132 to include
regulations that have ``substantial direct effects on the States, on
the relationship between the national government and the States, or on
the distribution of power and responsibilities among the various levels
of government.'' It has been determined that this proposed rule does
not contain policies that have federalism implications.
[[Page 42838]]
Paperwork Reduction Act
The Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.)
(``PRA'') requires that a Federal agency consider the impact of
paperwork and other information collection burdens imposed on the
public and, under the provisions of PRA Sec. 3507(d), obtain approval
from OMB for each collection of information it conducts, sponsors, or
requires through regulations. Notwithstanding any other provision of
law, no person is required to respond to, nor shall any person be
subject to a penalty for failure to comply with a collection of
information subject to the PRA unless that collection displays a
currently valid OMB Control Number.
The following table provides the only collection of information
(and corresponding OMB Control Numbers) set forth in this proposed
rule. This collection of information is necessary for the proper
performance and functions of EDA. The proposed rule does not include a
new information collection requirement and will, thus, use the
previously approved ED-840p form to collect information relevant to a
petition for certification of eligibility for trade adjustment
assistance.
------------------------------------------------------------------------
Part or section of Form/title/OMB
this proposed rule Nature of request control No.
------------------------------------------------------------------------
315.7(b)............... All firms seeking ED-840p, Petition by
certification of a firm for
eligibility to apply for Certification of
trade adjustment Eligibility to
assistance must complete Apply for Trade
the ED-840p form, which Adjustment
provides EDA with the Assistance (0610-
information needed to 0091).
determine if a firm is
eligible to apply for
trade adjustment
assistance.
------------------------------------------------------------------------
List of Subjects
13 CFR Part 302
Community development, Grant programs-business, Grant programs-
housing and community development, Technical assistance.
13 CFR Part 315
Administrative practice and procedure, Community development, Grant
programs-business, Reporting and recordkeeping requirements, Trade
adjustment assistance.
For the reasons discussed above, EDA proposes to amend 13 CFR,
chapter III as follows:
PART 302--GENERAL TERMS AND CONDITIONS FOR INVESTMENT ASSISTANCE
0
1. The authority citation of part 302 continues to read as follows:
Authority: 19 U.S.C. 2341 et seq.; 42 U.S.C. 3150; 42 U.S.C.
3152; 42 U.S.C. 3153; 42 U.S.C. 3192; 42 U.S.C. 3193; 42 U.S.C.
3194; 42 U.S.C. 3211; 42 U.S.C. 3212; 42 U.S.C. 3216; 42 U.S.C.
3218; 42 U.S.C. 3220; 42 U.S.C. 5141; 15 U.S.C. 3701; Department of
Commerce Delegation Order 10-4.
Sec. Sec. 302.4 and 302.5 [Removed]
0
2. Remove Sec. Sec. 302.4 and 302.5.
Sec. 302.11 [Removed]
0
3. Remove Sec. 302.11.
Sec. 302.14 [Removed]
0
4. Remove Sec. 302.14.
PART 315--TRADE ADJUSTMENT ASSISTANCE FOR FIRMS
0
5. Revise the authority citation of part 315 to read as follows:
Authority: 19 U.S.C. 2341 et seq., as amended by Division B,
Title I, Subtitle I, Part II of Pub. L. 111-5, 42 U.S.C. 3211; Pub.
L. 111-344, 124 Stat. 3611; Pub. L. 112-40, 125 Stat. 401; Pub. L.
113-203; Pub. L. 114-27; Department of Commerce Delegation Order 10-
4.
0
6. Revise Sec. 315.1 to read as follows:
Sec. 315.1 Purpose and Scope
Chapter 3 of title II of the Trade Act of 1974 (19 U.S.C. 2341-
2355) establishes the responsibilities of the Secretary of Commerce
concerning the Trade Adjustment Assistance for Firms (TAAF) program.
The regulations in this part lay out those responsibilities as
delegated to EDA by the Secretary. EDA executes these responsibilities
through cooperative agreements that support a network of Trade
Adjustment Assistance Centers (TAACs). The TAACs assist Firms in
petitioning EDA for certification of eligibility to receive Adjustment
Assistance. EDA certifies the eligibility of Firms. The TAACs then
provide Adjustment Assistance to Firms through the development and
implementation of Adjustment Proposals.
0
7. Amend Sec. 315.2 by:
0
a. Revising the introductory paragraph;
0
b. Revising the definitions for ``Adjustment Assistance'', ``Adjustment
Proposal'', ``Decreased Absolutely'', and ``Directly Competitive'';
0
c. Amending the definition of ``Firm'' by revising the introductory
text and paragraph (4);
0
d. Revising the definitions of ``Increase in Imports'', ``Partial
Separation'', ``Service Sector Firm'', and ``Total Separation''; and
0
c. Adding in alphabetical order a definition for ``Unjustifiable
Benefits''.
The revisions and additions read as follows:
Sec. 315.2 Definitions
In addition to the defined terms set forth in Sec. 300.3 of this
chapter, the following terms used in this part shall have the meanings
set forth below:
Adjustment Assistance means technical assistance provided to Firms
by TAACs under chapter 3 of title II of the Trade Act. The type of
assistance provided is determined by EDA and may include one or more of
the following:
(1) Assistance in preparing a Firm's petition for certification of
eligibility;
(2) Assistance to a Certified Firm in developing an Adjustment
Proposal for the Firm; and
(3) Assistance to a Certified Firm in implementing an Adjustment
Proposal.
Adjustment Proposal means a Certified Firm's plan for improving the
Firm's competitiveness in the marketplace.
* * * * *
Decreased Absolutely means a firm's sales or production has
declined by a minimum of five percent relative to its sales or
production during the applicable prior time period, and this decline
is:
* * * * *
Directly Competitive or Like means imported articles or services
that compete with and are substantially equivalent for commercial
purposes (i.e., are adapted for the same function or use and are
essentially interchangeable) as the Firm's articles or services. For
the purposes of this term, any Firm that engages in exploring or
drilling for oil or natural gas, or otherwise produces oil or natural
gas, shall be considered to be producing articles directly competitive
with imports of oil and with imports of natural gas.
Firm means an individual proprietorship, partnership, joint
venture, association, corporation (includes a development corporation),
[[Page 42839]]
business trust, cooperative, trustee in bankruptcy or receiver under
court decree, and includes fishing, agricultural or service sector
entities and those which explore, drill or otherwise produce oil or
natural gas. See also the definition of Service Sector Firm. Pursuant
to section 259 of chapter 3 of title II of the Trade Act (19 U.S.C.
2351), a Firm, together with any predecessor or successor firm, or any
affiliated firm controlled or substantially beneficially owned by
substantially the same person, may be considered a single Firm where
necessary to prevent Unjustifiable Benefits. For purposes of receiving
benefits under this part, when a Firm owns or controls other Firms, the
Firm and such other Firms may be considered a single Firm when they
produce or supply like or Directly Competitive articles or services or
are exerting essential economic control over one or more production
facilities. Accordingly, such other Firms may include a(n):
(1) * * *
(4) Subsidiary--a company (either foreign or domestic) that is
wholly owned or effectively controlled by another company. A Firm that
has been acquired by another Firm but which maintains operations
independent of the acquiring Firm is considered an Independent
Subsidiary and may be considered separately from the acquiring Firm as
eligible for TAAF assistance.
Increase in Imports means an increase in imports of Directly
Competitive or Like Articles or Services with articles produced or
services supplied by a Firm.
* * * * *
Partial Separation occurs when there has been no increase in
overall employment at the Firm and either of the following applies:
* * * * *
Service Sector Firm means a Firm engaged in the business of
supplying services.
* * * * *
Total Separation means the laying off or termination of employment
of an employee in a Firm for lack of work.
Unjustifiable Benefits means Adjustment Assistance inappropriately
accruing to the benefit of:
(1) Other Firms that would not otherwise be eligible when provided
to a Firm; or
(2) Any predecessor or successor Firm, or any affiliated Firm
controlled or substantially beneficially owned by substantially the
same person, rather than treating these entities as a single Firm.
Sec. Sec. 315.4 and 315.5 [Amended]
0
8. Transfer Sec. Sec. 315.4 and 315.5 from subpart A to subpart B;
0
9. Revise subparts B through E and add subpart F to read as follows:
Subpart B--TAAC Provisions
Sec.
315.4 TAAC Selection and Operation
315.5 The Role and Geographic Coverage of the TAACs
Subpart C--Certification of Firms
Sec.
315.6 Certification Requirements
315.7 Processing Petitions for Certification
315.8 Hearings
315.9 Loss of Certification Benefits
315.10 Appeals, Final Determinations and Termination of
Certification
Subpart D--Adjustment Proposals
Sec.
315.11 Adjustment Proposal Process
315.12 Adjustment Proposal Requirements
Subpart E--Protective Provisions
Sec.
315.13 Persons Engaged by Firms to Expedite Petitions and Adjustment
Proposals.
315.14 Conflicts of Interest
Subpart F--International Trade Commission Investigations
Sec.
315.15 Affirmative Findings.
Subpart B--TAAC Provisions
Sec. 315.4 TAAC Selection and Operation.
(a) EDA solicits applications from organizations interested in
operating a TAAC through Notice of Funding Opportunity announcements
laying out selection and award criteria. The following entities are
eligible to apply:
(1) Universities or affiliated organizations;
(2) States or local governments; or
(3) Non-profit organizations.
(b) Entities selected to operate the TAACs are awarded cooperative
agreements and work closely with EDA and import-impacted firms. TAAC
cooperative agreements are subject to all Federal laws and to Federal,
Department, and EDA policies, regulations, and procedures applicable to
Federal financial assistance awards, including 2 CFR part 200, Uniform
Administrative Requirements, Cost Principles, and Audit Requirements
for Federal Awards.
Sec. 315.5 The Role and Geographic Coverage of the TAACs.
(a) TAACs are available to assist Firms in obtaining Adjustment
Assistance in all 50 U.S. States, the District of Columbia and the
Commonwealth of Puerto Rico. TAACs provide Adjustment Assistance in
accordance with this part either through their own staffs or by
arrangements with outside consultants. Information concerning TAACs and
their coverage areas may be obtained from the TAAC website at http://www.taacenters.org or from EDA at http://www.eda.gov.
(b) Prior to submitting a petition for Adjustment Assistance to
EDA, a Firm should determine the extent to which a TAAC can provide the
required Adjustment Assistance. EDA will provide Adjustment Assistance
through TAACs whenever EDA determines that such assistance can be
provided most effectively in this manner. Requests for Adjustment
Assistance will be made through TAACs.
(c) A TAAC generally provides Adjustment Assistance by:
(1) Helping a Firm to prepare its petition for eligibility
certification; and
(2) Assisting Certified Firms with diagnosing their strengths and
weaknesses, and with developing and implementing an Adjustment
Proposal.
Subpart C--Certification of Firms
Sec. 315.6 Certification Requirements.
(a) General. Firms apply for certification through a TAAC by
completing a petition for certification. The TAAC will assist Firms in
completing such petitions at no cost to the Firms. EDA evaluates Firms'
petitions based on the requirements set forth in Sec. 315.7. EDA may
certify a Firm as eligible to apply for Adjustment Assistance under
section 251(c) of the Trade Act (19 U.S.C. 2341) if it determines that
the petition for certification meets one of the minimum certification
thresholds set forth in paragraph (b) of this section. In order to be
certified, a Firm must meet the criteria listed under any one of the 5
circumstances described in paragraph (b) of this section.
(b) Minimum certification thresholds. (1) Twelve-month decline.
Based upon a comparison of the most recent 12-month period for which
data are available and the immediately preceding twelve-month period:
(i) A Significant Number or Proportion of Workers in the Firm has
undergone Total or Partial Separation or a Threat of Total or Partial
Separation;
(ii) Either sales or production, or both, of the Firm has Decreased
Absolutely; or sales or production, or both, of any article or service
that accounted for not less than 25 percent of the total production or
sales of the Firm during the 12-month period preceding the most recent
12-month period for which data are available have Decreased Absolutely;
and
[[Page 42840]]
(iii) An Increase in Imports has Contributed Importantly to the
applicable Total or Partial Separation or Threat of Total or Partial
Separation, and to the applicable decline in sales or production or
supply of services.
(2) Twelve-month versus twenty-four month decline. Based upon a
comparison of the most recent 12-month period for which data are
available and the immediately preceding 24-month period:
(i) A Significant Number or Proportion of Workers in the Firm has
undergone Total or Partial Separation or a Threat of Total or Partial
Separation;
(ii) Either average annual sales or production, or both, of the
Firm has Decreased Absolutely; or average annual sales or production,
or both, of any article or service that accounted for not less than 25
percent of the total production or sales of the Firm during the 24-
month period preceding the most recent 12-month period for which data
are available have Decreased Absolutely; and
(iii) An Increase in Imports has Contributed Importantly to the
applicable Total or Partial Separation or Threat of Total or Partial
Separation, and to the applicable decline in sales or production or
supply of services.
(3) Twelve-month versus thirty-six month decline. Based upon a
comparison of the most recent 12-month period for which data are
available and the immediately preceding 36-month period:
(i) A Significant Number or Proportion of Workers in the Firm has
undergone Total or Partial Separation or a Threat of Total or Partial
Separation;
(ii) Either average annual sales or production, or both, of the
Firm has Decreased Absolutely; or average annual sales or production,
or both, of any article or service that accounted for not less than 25
percent of the total production or sales of the Firm during the 36-
month period preceding the most recent 12-month period for which data
are available have Decreased Absolutely; and
(iii) An Increase in Imports has Contributed Importantly to the
applicable Total or Partial Separation or Threat of Total or Partial
Separation, and to the applicable decline in sales or production or
supply of services.
(4) Interim sales or production decline. Based upon an interim
sales or production decline:
(i) Sales or production has Decreased Absolutely for, at minimum,
the most recent six-month period during the most recent 12-month period
for which data are available as compared to the same six-month period
during the immediately preceding 12-month period;
(ii) During the same base and comparative period of time as sales
or production has Decreased Absolutely, a Significant Number or
Proportion of Workers in such Firm has undergone Total or Partial
Separation or a Threat of Total or Partial Separation; and
(iii) During the same base and comparative period of time as sales
or production has Decreased Absolutely, an Increase in Imports has
Contributed Importantly to the applicable Total or Partial Separation
or Threat of Total or Partial Separation, and to the applicable decline
in sales or production or supply of services.
(5) Interim employment decline. Based upon an interim employment
decline:
(i) A Significant Number or Proportion of Workers in such Firm has
undergone Total or Partial Separation or a Threat of Total or Partial
Separation during, at a minimum, the most recent six-month period
during the most recent 12-month period for which data are available as
compared to the same six-month period during the immediately preceding
12-month period; and
(ii) Either sales or production of the Firm has Decreased
Absolutely during the 12-month period preceding the most recent 12-
month period for which data are available; and
(iii) An Increase in Imports has Contributed Importantly to the
applicable Total or Partial Separation or Threat of Total or Partial
Separation, and to the applicable decline in sales or production or
supply of services.
(c) EDA may consider as evidence of an Increase in Imports a
certification from the Firm's customers that account for a significant
percentage of the Firm's decrease in sales or production, that they
have increased their purchase of imports of Directly Competitive or
Like Articles or Services from a foreign country, either absolutely or
relative to their acquisition of such Like Articles or Services from
suppliers located in the United States. Such certification from a
Firm's customer must be submitted directly to a TAAC or to EDA.
Sec. 315.7 Processing Petitions for Certification.
(a) Firms shall consult with a TAAC for guidance and assistance in
the preparation of their petitions for certification.
(b) A Firm seeking certification shall complete a Petition by a
Firm for Certification of Eligibility to Apply for Trade Adjustment
Assistance (Form ED-840P or any successor form) with the following
information about such Firm:
(1) Identification and description of the Firm, including legal
form of organization, economic history, major ownership interests,
officers, directors, management, parent company, Subsidiaries or
Affiliates, and production and sales facilities;
(2) Description of goods or services supplied or sold;
(3) Description of imported Directly Competitive or Like Articles
or Services with those produced or supplied;
(4) Data on its sales, production and employment for the applicable
24-month, 36-month, or 48-month period, as required under Sec.
315.6(b);
(5) One copy of a complete auditor's certified financial report for
the entire period covering the petition, or if not available, one copy
of the complete profit and loss statements, balance sheets and
supporting statements prepared by the Firm's accountants for the entire
period covered by the petition. In addition, publicly-owned
corporations should also submit copies of the most recent Form 10-K
annual reports (or Form 10-Q quarterly reports, as appropriate) filed
with the U.S. Securities and Exchange Commission for the entire period
covered by the petition.
(6) Information concerning customers accounting for a significant
percent of the Firm's decline and the customers' purchases (or the
Firm's unsuccessful bids, if there are no customers fitting this
description); and
(7) Such other information as EDA considers material.
(c) EDA shall determine whether the petition has been properly
prepared and can be accepted. Promptly thereafter, EDA shall notify the
petitioner that the petition has been accepted or advise the TAAC that
the petition has not been accepted, but may be resubmitted at any time
without prejudice when the specified deficiencies have been corrected.
Any resubmission will be treated as a new petition.
(d) EDA will publish a notice of acceptance of a petition in the
Federal Register.
(e) EDA will initiate an investigation to determine whether the
petitioner meets the requirements set forth in section 251(c) of the
Trade Act (19 U.S.C. 2341) and Sec. 315.6.
(f) A petition for certification may be withdrawn if EDA receives a
request for withdrawal submitted by the petitioner before EDA makes a
certification determination or denial. A Firm may submit a new petition
at any time thereafter in accordance with the requirements of this
section and Sec. 315.6.
[[Page 42841]]
(g) Following acceptance of a petition, EDA will:
(1) Make a determination based on the Record as soon as possible
after the petitioning Firm or TAAC has submitted all requested
material. In no event may the determination period exceed 40 calendar
days from the date on which EDA accepted the petition; and
(2) Either certify the petitioner as eligible to apply for
Adjustment Assistance or deny the petition. In either event, EDA shall
promptly give written notice of action to the petitioner. Any written
notice to the petitioner of a denial of a petition shall specify the
reason(s) for the denial. A petitioner shall not be entitled to
resubmit a petition within one year from the date of denial unless EDA
waives the one-year limitation for good cause.
Sec. 315.8 Hearings.
EDA will hold a public hearing on an accepted petition if the
petitioner or any interested Person found by EDA to have a Substantial
Interest in the proceedings submits a request for a hearing no later
than 10 calendar days after the date of publication of the notice of
acceptance in the Federal Register, under the following procedures:
(a) The petitioner or any interested Person(s) shall have an
opportunity to be present, to produce evidence and to be heard.
(b) A request for public hearing must be delivered by hand or by
registered mail to EDA. A request by a Person other than the petitioner
shall contain:
(1) The name, address and telephone number of the Person requesting
the hearing; and
(2) A complete statement of the relationship of the Person
requesting the hearing to the petitioner and the subject matter of the
petition, and a statement of the nature of the requesting party's
interest in the proceedings.
(c) If EDA determines that the requesting party does not have a
Substantial Interest in the proceedings, a written notice of denial
shall be sent to the requesting party. The notice shall specify the
reasons for the denial.
(d) If EDA determines that the requesting party does have a
Substantial Interest in the proceedings, EDA shall publish a notice of
a public hearing in the Federal Register, containing the subject
matter, name of petitioner, and date, time and place of the hearing.
(e) EDA shall appoint a presiding officer for the hearing who shall
respond to all procedural questions.
Sec. 315.9 Loss of Certification Benefits.
EDA may terminate a Firm's certification or refuse to extend
Adjustment Assistance to a Firm for any of the following reasons:
(a) The Firm failed to submit an acceptable Adjustment Proposal
within two years after date of certification. While approval of an
Adjustment Proposal may occur after the expiration of such two-year
period, a Firm must submit an acceptable Adjustment Proposal before
such expiration.
(b) The Firm failed to submit documentation necessary to start
implementation or modify its request for Adjustment Assistance
consistent with its Adjustment Proposal within six months after
approval of the Adjustment Proposal, where two years have elapsed since
the date of certification. If the Firm anticipates needing a longer
period to submit documentation, it should indicate the longer period in
its Adjustment Proposal. If the Firm is unable to submit its
documentation within the allowed time, it should notify EDA in writing
of the reasons for the delay and submit a new schedule. EDA has the
discretion to accept or refuse a new schedule.
(c) EDA has denied the Firm's request for Adjustment Assistance,
the time period allowed for the submission of any documentation in
support of such request has expired, and two years have elapsed since
the date of certification.
(d) The Firm failed to diligently pursue an approved Adjustment
Proposal, and five years have elapsed since the date of certification.
Sec. 315.10 Appeals, Final Determinations and Termination of
Certification.
(a) Any petitioner may appeal in writing to EDA from a denial of
certification, provided that EDA receives the appeal by personal
delivery or by registered mail within 60 calendar days from the date of
notice of denial under Sec. 315.7(g). The appeal must state the
grounds on which the appeal is based, including a concise statement of
the supporting facts and applicable law. The decision of EDA on the
appeal shall be the final determination within the Department. In the
absence of an appeal by the petitioner under this paragraph, the
determination under Sec. 315.7(g) shall be final.
(b) A Firm, its representative or any other interested domestic
party aggrieved by a final determination under paragraph (a) of this
section may, within 60 calendar days after notice of such
determination, begin a civil action in the United States Court of
International Trade for review of such determination, in accordance
with section 284 of the Trade Act (19 U.S.C. 2395).
(c) Whenever EDA determines that a Certified Firm no longer
requires Adjustment Assistance or for other good cause, EDA will
terminate the certification and promptly publish notice of such
termination in the Federal Register. The termination will take effect
on the date specified in the published notice. EDA shall immediately
notify the petitioner and shall state the reasons for any termination.
Subpart D--Adjustment Proposals
Sec. 315.11 Adjustment Proposal Process.
(a) Firms certified in accordance with the procedures described in
Sec. Sec. 315.6 and 315.7 must prepare an Adjustment Proposal and
submit it to EDA for approval within two years after the date of
Certification.
(b) EDA determines whether to approve the Adjustment Assistance
requested in the Adjustment Proposal based upon the evaluation criteria
set forth in Sec. 315.12 of this subpart. Upon approval, a Certified
Firm may submit a request to the TAAC for Adjustment Assistance to
implement an approved Adjustment Proposal. Firms must begin
implementation within six months after approval. Firms that do not
begin implementation within six months after approval must update, re-
submit their Adjustment Proposal, and request re-approval before any
Adjustment Assistance may be provided.
(c) EDA will make a determination regarding the Adjustment Proposal
no later than 60 calendar days upon receipt of the Adjustment Proposal.
(d) Adjustment Assistance is subject to the following matching
share requirements:
(1) Each Certified Firm must pay at least 25 percent of the cost of
preparing its Adjustment Proposal. Each Certified Firm requesting
$30,000 or less in total Adjustment Assistance in its approved
Adjustment Proposal must pay at least 25 percent of the cost of that
Adjustment Assistance. Each Certified Firm requesting more than $30,000
in total Adjustment Assistance in its approved Adjustment Proposal must
pay at least 50 percent of the cost of that Adjustment Assistance.
Certified Firms may request no more than the amount as established by
EDA for total Adjustment Assistance over the entire lifetime of the
firm.
(e) Firms may request EDA approval to amend their Adjustment Plans
within two years from the date of EDA approval of their initial
Adjustment Plan.
(f) Firms must complete implementation of their Adjustment
[[Page 42842]]
Plans within five years of EDA approval of their initial Adjustment
Plan.
(g) If a Certified Firm is transferred, sold, or otherwise acquired
by another Firm during the five-year period of Adjustment Assistance,
the Firm must notify EDA no later than 30 calendar days following the
transfer, sale, or acquisition. EDA will then make a determination as
to whether the Firm remains eligible for Adjustment Assistance. EDA
will make this determination no later than 60 calendar days following
notification by the Firm.
(h) In accordance with Section 255A of chapter 3 of title II of the
Trade Act (19 U.S.C. 2345a), Firms that receive Adjustment Assistance
must provide data regarding the Firms' sales, employment, and
productivity upon completion of the program and each year for the two-
year period following completion.
Sec. 315.12 Adjustment Proposal Requirements.
EDA evaluates Adjustment Proposals based on the following:
(a) The Adjustment Proposal must include a description of any
Adjustment Assistance requested to implement such proposal, including
financial and other supporting documentation as EDA determines is
necessary, based upon either:
(1) An analysis of the Firm's problems, strengths and weaknesses
and an assessment of its prospects for recovery; or
(2) If EDA so determines, other available information;
(b) The Adjustment Proposal must:
(1) Be reasonably calculated to contribute materially to the
economic adjustment of the Firm (i.e., that such proposal will
constructively assist the Firm to establish a competitive position in
the same or a different industry);
(2) Give adequate consideration to the interests of a sufficient
number of separated workers of the Firm, by providing, for example,
that the Firm will:
(i) Give a rehiring preference to such workers;
(ii) Make efforts to find new work for a number of such workers;
and
(iii) Assist such workers in obtaining benefits under available
programs; and
(3) Demonstrate that the Firm will make all reasonable efforts to
use its own resources for its recovery, though under certain
circumstances, resources of related Firms or major stockholders will
also be considered; and
(c) The Adjustment Assistance identified in the Adjustment Proposal
must consist of specialized consulting services designed to assist the
Firm in becoming more competitive in the global marketplace. For this
purpose, Adjustment Assistance generally consists of knowledge-based
services such as market penetration studies, customized business
improvements, and designs for new products. Adjustment Assistance does
not include expenditures for capital improvements or for the purchase
of business machinery or supplies.
Subpart E--Protective Provisions
Sec. 315.13 Persons Engaged by Firms to Expedite Petitions and
Adjustment Proposals.
EDA will provide no Adjustment Assistance to any Firm unless the
owners, partners, members, directors or officers thereof certify in
writing to EDA:
(a) The names of any attorneys, agents, and other Persons engaged
by or on behalf of the Firm for the purpose of expediting Petitions for
such Adjustment Assistance or Adjustment Proposals; and
(b) The fees paid or to be paid to any such Person.
Sec. 315.14 Conflicts of Interest.
EDA will provide no Adjustment Assistance to any Firm under this
part unless the owners, partners, members, directors or officers
thereof execute an agreement binding them and the Firm for a period of
two years after such Adjustment Assistance is provided, to refrain from
employing, tendering any office or employment to, or retaining for
professional services any Person who, on the date such assistance or
any part thereof was provided, or within one year prior thereto, shall
have served as an officer, attorney, agent, or employee occupying a
position or engaging in activities which involved discretion with
respect to the provision of such Adjustment Assistance.
Subpart F--International Trade Commission Investigations
Sec. 315.15 Affirmative Findings.
Whenever the International Trade Commission makes an affirmative
finding under section 202(b) of the Trade Act (19 U.S.C. 2252) that
increased imports are a substantial cause of serious injury or threat
thereof with respect to an industry or under sections 705 or 735 of the
Tariff Act (19 U.S.C. 1671d, 1673d), EDA will notify the TAACs and
provide expedited review of petitions and Adjustment Plans from Firms
within the specified industry.
Dated: August 12, 2019.
John Fleming,
Assistant Secretary of Commerce for Economic Development.
[FR Doc. 2019-17710 Filed 8-16-19; 8:45 am]
BILLING CODE 3510-24-P
