[Federal Register Volume 85, Number 70 (Friday, April 10, 2020)]
[Rules and Regulations]
[Pages 20195-20200]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-07659]
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DEPARTMENT OF HOMELAND SECURITY
Federal Emergency Management Agency
44 CFR Part 328
[Docket ID FEMA-2020-0018]
RIN 1660-AB01
Prioritization and Allocation of Certain Scarce or Threatened
Health and Medical Resources for Domestic Use
AGENCY: Federal Emergency Management Agency, DHS.
ACTION: Temporary final rule.
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SUMMARY: The Federal Emergency Management Agency (FEMA) is issuing a
temporary rule to allocate certain scarce or threatened materials for
domestic use, so that these materials may not be exported from the
United States without explicit approval by FEMA. The rule covers five
types of personal protective equipment (PPE), outlined below. While
this rule remains in effect, and subject to certain exemptions stated
below, no shipments of such designated materials may leave the United
States without explicit approval by FEMA.
DATES: Effective date: This rule is effective from April 7, 2020 until
August 10, 2020.
ADDRESSES: You may review the docket by searching for Docket ID FEMA-
2020-0018, via the Federal eRulemaking Portal: http://www.regulations.gov.
FOR FURTHER INFORMATION CONTACT: Daniel McMasters, Office of Policy and
Program Analysis, 202-709-0661, FEMA-DPA@fema.dhs.gov.
SUPPLEMENTARY INFORMATION:
I. Background
A. The Current COVID-19 Pandemic
COVID-19 is a communicable disease caused by severe acute
respiratory syndrome coronavirus 2 (SARS-CoV-2), that was first
identified as the cause of an outbreak of respiratory illness that
began in Wuhan, Hubei Province, People's Republic of China. The virus
is thought to be transmitted primarily by person-to-person contact
through respiratory droplets produced when an infected person coughs,
sneezes, or talks. Some recent studies have suggested that COVID-19 may
be spread by people who are not showing symptoms. It also may be
possible that a person can get COVID-19 by touching a surface or object
that has the virus on it and then touching their own mouth, nose, or
possibly their eyes. Older adults and people of all ages with
underlying medical conditions, particularly if not well controlled, are
at higher risk for more serious COVID-19 illness.\1\
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\1\ Information obtained from https://www.coronavirus.gov
(accessed April 2, 2020).
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On January 30, 2020, the Director-General of the World Health
Organization (WHO) declared that the outbreak of COVID-19 is a Public
Health Emergency of International Concern under the International
Health Regulations.\2\ The following day, the Secretary of Health and
Human Services (HHS) declared COVID-19 a public health emergency under
Section 319 of the Public Health Service (PHS) Act.\3\ On March 11,
2020, the WHO declared COVID-19 a pandemic. On March 13, 2020, the
President issued a Proclamation on Declaring a National Emergency
Concerning the Novel Coronavirus Disease (COVID-19) Outbreak under
sections 201 and 301 of the National Emergencies Act, 50 U.S.C. 1601 et
seq., and consistent with section 1135 of the Social Security Act, 42
U.S.C. 1320b-5.\4\ On March 13, 2020, the President declared a
nationwide emergency under section 501(b) of the Robert T. Stafford
Disaster Relief and Emergency Assistance Act, authorizing FEMA to
provide assistance for emergency protective measures to respond to the
COVID-19 pandemic.\5\
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\2\ Statement on the second meeting of the International Health
Regulations (2005) Emergency Committee regarding the outbreak of
novel coronavirus (2019-nCoV) (January 30, 2020), available at
https://www.who.int/news-room/detail/30-01-2020-statement-on-the-second-meeting-of-the-international-health-regulations-(2005)-
emergency-committee-regarding-the-outbreak-of-novel-coronavirus-
(2019-ncov).
\3\ HHS, ``Determination that a Public Health Emergency
Exists,'' available at https://www.phe.gov/emergency/news/healthactions/phe/Pages/2019-nCoV.aspx (Jan. 31, 2020).
\4\ ``Proclamation on Declaring a National Emergency Concerning
the Novel Coronavirus Disease (COVID-19) Outbreak,'' March 13, 2020,
available at https://www.whitehouse.gov/presidential-actions/proclamation-declaring-national-emergency-concerning-novel-coronavirus-disease-covid-19-outbreak/.
\5\ COVID-19 Emergency Declaration available at https://www.fema.gov/news-release/2020/03/13/covid-19-emergency-declaration
(accessed April 6, 2020).
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As of April 7, 2020, there were over 333,000 cases of COVID-19 in
the United States, resulting in over 9,500 deaths due to the disease,
with new cases being reported daily. Worldwide, there have been over
1.28 million confirmed cases, resulting in over 72,600 deaths.\6\ At
this time, there is no vaccine that can prevent infection with COVID-
19, nor is there currently any FDA-approved post-exposure
[[Page 20196]]
prophylaxis for people who may have been exposed to COVID-19. Treatment
is currently limited to supportive (or palliative) care for patients
who need it. Clinical management for hospitalized patients with COVID-
19 is focused on supportive care for complications, including
supplemental oxygen and advanced organ support for respiratory failure,
septic shock, and multi-organ failure.\7\
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\6\ Information obtained from https://www.who.int/ (accessed
April 7, 2020).
\7\ Information obtained from https://www.coronavirus.gov
(accessed April 7, 2020).
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Within the United States, widespread transmission of COVID-19 has
occurred. Widespread transmission of COVID-19 has resulted and will
continue to result in large numbers of people needing medical care at
the same time. Public health and healthcare systems may become
overloaded, with elevated rates of hospitalizations and deaths, as well
as elevated demand for PPE, including the PPE covered by this rule.
B. Legal Authorities
FEMA is issuing this temporary rule as part of its response to the
COVID-19 pandemic. The rule is issued pursuant to the following
authorities, among others:
The Defense Production Act of 1950, as amended (``DPA'' or
``the Act''), and specifically sections 101 and 704 of the Act, 50
U.S.C. 4511, 4554;
Executive Order 13909, 85 FR 16227 (Mar. 23, 2020);
Executive Order 13910, 85 FR 17001 (Mar. 26, 2020);
Executive Order 13911, 85 FR 18403 (Apr. 1, 2020);
DHS Delegation Number 09052 Rev. 00.1, ``Delegation of
Defense Production Act Authority to the Administrator of the Federal
Emergency Management Agency'' (Apr. 1, 2020); and
The Presidential Memorandum on Allocating Certain Scarce
or Threatened Health and Medical Resources to Domestic Use (April 3,
2020).\8\
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\8\ See Memorandum on Allocating Certain Scarce or Threatened
Health and Medical Resources to Domestic Use for the Secretary of
Health and Human Services, the Secretary of Homeland Security, and
the Administrator of the Federal Emergency Management Agency (Apr.
3, 2020), https://www.whitehouse.gov/presidential-actions/memorandum-allocating-certain-scarce-threatened-health-medical-resources-domestic-use/ (last visited Apr. 5, 2020).
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FEMA describes each authority in turn. The President has broadly
delegated authority to make determinations and take action with respect
to health and medical resources for COVID-19 response under Section 101
of the DPA to the Secretary of Homeland Security in Executive Order
13911. This authority has in turn been delegated to the FEMA
Administrator in DHS Delegation 09052, Rev. 00.1 (Apr. 1, 2020).
First, under subsection 101(a) of the Act, 50 U.S.C. 4511(a), the
President may (1) require that performance under contracts or orders
(other than contracts of employment) which he deems necessary or
appropriate to promote the national defense shall take priority over
performance under any other contract or order, and, for the purpose of
assuring such priority, require acceptance and performance of such
contracts or orders in preference to other contracts or orders by any
person he finds to be capable of their performance. The President may
also (2) allocate materials, services, and facilities in such manner,
upon such conditions, and to such extent as he shall deem necessary or
appropriate to promote the national defense. FEMA refers to these
authorities as relating to ``priority ratings'' and ``allocation,''
respectively.
Under subsection 101(b) of the Act, 50 U.S.C. 4511(b), the
President may not use the aforementioned authorities to control the
general distribution of any material in the civilian market unless the
President finds (1) that such material is a scarce and critical
material essential to the national defense, and (2) that the
requirements of the national defense for such material cannot otherwise
be met without creating a significant dislocation of the normal
distribution of such material in the civilian market to such a degree
as to create appreciable hardship.
Under subsection 101(d) of the Act, 50 U.S.C. 4511(d), the head of
each Federal agency to which the President delegates authority under
section 101 of the Act (1) shall issue, and annually review and update
whenever appropriate, final rules, in accordance with 5 U.S.C. 553,
that establish standards and procedures by which the priorities and
allocations authority under section 101 is used to promote the national
defense, under both emergency and nonemergency conditions; and (2) as
appropriate and to the extent practicable, consult with the heads of
other Federal agencies to develop a consistent and unified Federal
priorities and allocations system.\9\
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\9\ FEMA has not yet issued comprehensive regulations on its
implementation of section 101 of the Act. As noted below, FEMA was
only recently delegated authority under section 101 of the Act. As
described in greater detail below, this temporary final rule
implements section 101(a) of the Act and related authority for a
specific purpose and for a limited period of time. FEMA anticipates
issuing comprehensive regulations under section 101 of the Act in
the near future. In addition to section 101 of the Act, this rule
implements FEMA's broad delegated authority under section 704 of the
Act, 50 U.S.C. 4554, to prescribe such regulations and issue such
orders as FEMA may determine appropriate to carry out its delegated
authorities under the Act. The President has delegated this
authority to the Secretary of Homeland Security under sections 2 and
5 of Executive Order 13911, who in turn delegated it to the
Administrator of FEMA in DHS Delegation 09052, Rev. 00.1 (Apr. 1,
2020).
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Second, on March 18, 2020, the President signed Executive Order
13909, which delegated to the Secretary of HHS authority under the DPA
for the prioritization and allocation of health and medical resources
to respond to the spread of COVID-19. The President determined that to
ensure that our healthcare system is able to surge capacity and
capability to respond to the spread of COVID-19, it is critical that
all health and medical resources needed to respond to the spread of
COVID-19 are properly distributed to the Nation's healthcare system and
others that need them most at this time. The President found that
health and medical resources needed to respond to the spread of COVID-
19, including personal protective equipment and ventilators, meet the
criteria specified in section 101(b) of the Act (50 U.S.C.
4511(b)).\10\
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\10\ The Executive Order delegates to the Secretary of Health
and Human Services the President's authority under section 101 of
the Act, 50 U.S.C. 4511, including the authority to identify
additional specific health and medical resources that meet the
criteria of section 101(b). The Executive Order allows the Secretary
of Health and Human Services, using the delegated authority under
section 101 of the Act, to determine, in consultation with the
Secretary of Commerce and the heads of other executive departments
and agencies as appropriate, the proper nationwide priorities and
allocation of all health and medical resources needed to respond to
the spread of COVID-19 within the United States.
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Third, on March 23, 2020, the President signed Executive Order
13910, in which the President delegated to the Secretary of HHS the
authority under section 102 of the Act to prevent hoarding and price
gouging with respect to health and medical resources necessary to
respond to the spread of COVID-19. On March 25, 2020, the Secretary of
Health and Human Services designated under section 102 of the Act 15
categories of health and medical resources as scarce materials or
materials the supply of which would be threatened by accumulation in
excess of the reasonable demands of business, personal, or home
consumption, or for the purpose of resale at prices in excess of
prevailing market prices (``scarce or threatened materials''). See 85
FR 17592 (Mar. 30, 2020). These designated items include certain PPE
materials that are the subject of this rulemaking.
Fourth, on March 27, 2020, the President signed Executive Order
13911, which (among other things) delegated to
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the Secretary of Homeland Security the President's authority under
section 101 of the Act with respect to health and medical resources
needed to respond to the spread of COVID-19 within the United States.
The Executive Order provides that the Secretary of Homeland Security
may use the authority under section 101 of the Act to determine, in
consultation with the heads of other executive departments and agencies
as appropriate, the proper nationwide priorities and allocation of
health and medical resources, including by controlling the distribution
of such materials (including applicable services) in the civilian
market, for responding to the spread of COVID-19 within the United
States.\11\ The Secretary of Homeland Security has delegated his
authorities under Executive Order 13911 to FEMA. See DHS Delegation
09052, Rev. 00.1 (Apr. 1, 2020).
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\11\ The Executive Order also delegated to the Secretary of
Homeland Security the authority under section 102 of the Act to
prevent hoarding and price gouging with respect to such resources,
and requires that before exercising the authority under section 102
of the Act, the Secretary of Homeland Security shall consult with
the Secretary of Health and Human Services.
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Finally, on April 3, 2020, the President signed a Memorandum on
Allocating Certain Scarce or Threatened Health and Medical Resources to
Domestic Use. The Memorandum reaffirmed the delegations and findings
contained in Executive Orders 13909, 13910, and 13911, including that
health and medical resources needed to respond to the spread of COVID-
19, including personal protective equipment (PPE) and ventilators, meet
the criteria specified in section 101(b) of the Act, i.e., that (1)
such material is a scarce and critical material essential to the
national defense, and (2) that the requirements of the national defense
for such material cannot otherwise be met without creating a
significant dislocation of the normal distribution of such material in
the civilian market to such a degree as to create appreciable hardship.
The President further stated that to ensure that these scarce or
threatened PPE materials remain in the United States for use in
responding to the spread of COVID-19, it is the policy of the United
States to prevent domestic brokers, distributors, and other
intermediaries from diverting such material overseas.
In furtherance of such policy, the President directed that the
Secretary of Homeland Security, through the FEMA Administrator, and in
consultation with the Secretary of HHS, shall use any and all authority
available under section 101 of the Act to allocate to domestic use, as
appropriate, the following scarce or threatened materials designated by
the Secretary of HHS under Section 102 of the DPA:
N95 Filtering Facepiece Respirators, including devices
that are disposable half-face-piece non-powered air-purifying
particulate respirators intended for use to cover the nose and mouth of
the wearer to help reduce wearer exposure to pathogenic biological
airborne particulates;
Other Filtering Facepiece Respirators (e.g., those
designated as N99, N100, R95, R99, R100, or P95, P99, P100), including
single-use, disposable half-mask respiratory protective devices that
cover the user's airway (nose and mouth) and offer protection from
particulate materials at an N95 filtration efficiency level per 42 CFR
84.181;
Elastomeric, air-purifying respirators and appropriate
particulate filters/cartridges;
PPE surgical masks, including masks that cover the user's
nose and mouth and provide a physical barrier to fluids and particulate
materials; and
PPE gloves or surgical gloves, including those defined at
21 CFR 880.6250 (exam gloves) and 878.4460 (surgical gloves) and such
gloves intended for the same purposes.
Pursuant to this Memorandum, and with the authority delegated to
the Secretary of Homeland Security in E.O. 13911 and re-delegated to
the FEMA Administrator in DHS Delegation 09052 Rev. 00.1, FEMA now
issues this allocation order as a temporary rule.
II. Provisions of the Temporary Final Rule
Following consultation with the Secretary of HHS; pursuant to the
President's direction; and as an exercise of the Administrator's
priority order, allocation, and regulatory authorities under the Act,
the Administrator has determined that the scarce or threatened
materials identified in the April 3, 2020 Presidential Memorandum
(``covered materials'') shall be allocated for domestic use, and may
not be exported from the United States without explicit approval by
FEMA. See new 44 CFR 328.102(a).
The rule is necessary and appropriate to promote the national
defense with respect to the covered materials because the domestic need
for them exceeds the supply. Under this temporary rule, before any
shipments of such covered materials may leave the United States, CBP
will detain the shipment temporarily, during which time FEMA will
determine whether to return for domestic use, issue a rated order for,
or allow the export of part or all of the shipment under section 101(a)
of the Act, 50 U.S.C. 4511(a). FEMA will make such a determination
within a reasonable time of being notified of an intended shipment and
will make all decisions consistent with promoting the national defense.
See new 44 CFR 328.102(b). FEMA will work to review and make
determinations quickly and will endeavor to minimize disruptions to the
supply chain.
In determining whether it is necessary or appropriate to promote
the national defense to purchase covered materials, or allocate
materials for domestic use, FEMA may consult other agencies and will
consider the totality of the circumstances, including the following
factors: (1) The need to ensure that scarce or threatened items are
appropriately allocated for domestic use; (2) minimization of
disruption to the supply chain, both domestically and abroad; (3) the
circumstances surrounding the distribution of the materials and
potential hoarding or price-gouging concerns; (4) the quantity and
quality of the materials; (5) humanitarian considerations; and (6)
international relations and diplomatic considerations.
This rule contains an exemption that the Administrator has
determined to be necessary or appropriate to promote the national
defense. See new 44 CFR 328.102(c). Specifically, the Administrator has
determined that FEMA will not purchase covered materials from shipments
made by or on behalf of U.S. manufacturers with continuous export
agreements with customers in other countries since at least January 1,
2020, so long as at least 80 percent of such manufacturer's domestic
production of covered materials, on a per item basis, was distributed
in the United States in the preceding 12 months. The Administrator
decided that this exemption is necessary or appropriate to promote the
national defense because it would limit the impact of this order on
pre-existing commercial relationships, in recognition of the importance
of these commercial relationships to the international supply chain,
and for humanitarian reasons, in consideration of the global nature of
the COVID-19 pandemic. If FEMA determines that a shipment of covered
materials falls within this exemption, such materials may be
transferred out of the United States without further review by FEMA,
provided that the Administrator may waive this exemption and fully
review shipments of covered materials subject to this exemption for
further action by FEMA, if the Administrator determines that doing so
is necessary or appropriate
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to promote the national defense. FEMA may develop additional guidance
regarding which exports are covered by this exemption, and encourages
manufacturers to contact FEMA with specific information regarding their
status under this exemption.
The Administrator may establish, in his discretion, additional
exemptions that he determines are necessary or appropriate to promote
the national defense and will announce any such exemptions by notice in
the Federal Register.
FEMA will implement this rule with the cooperation and assistance
of other U.S. Government agencies, including CBP, and will work with
manufacturers, brokers, distributors, exporters, and shippers to ensure
that the applicable requirements are carried out. Any covered materials
intended for export may be detained by CBP while FEMA conducts its
review of the shipment. FEMA will review the shipment and provide
notification as soon as possible regarding the disposition of the
covered materials under this order, provided that any goods that have
been detained by CBP and are subsequently made subject to a DPA-rated
order will be consigned to FEMA pending further distribution or agency
direction. FEMA may provide additional guidance regarding the
application of any exemptions to this temporary rule, as appropriate.
FEMA may conduct such investigations and issue such requests for
information as may be necessary for the enforcement of the Act,
including this rule. See new 44 CFR 328.104(a); see also section 705 of
the Act, 50 U.S.C. 4555; Executive Order 13911, 85 FR 18403 (Apr. 1,
2020). FEMA may seek an injunction or other order whenever, in the
Administrator's judgment, a person has engaged or is about to engage in
any acts or practices which constitute or will constitute a violation
of the Act or any rule or order issued thereunder. See new 44 CFR
328.104(b); see also section 706 of the Act, 50 U.S.C. 4556. In
addition to an injunction, failure to comply fully with this rule is a
crime punishable by a fine of not more than $10,000 or imprisonment for
not more than one year, or both. See new 44 CFR 328.104(c); see also
section 103 of the Act, 50 U.S.C. 4513. In addition, pursuant to 18
U.S.C. 554, whoever fraudulently or knowingly exports or sends from the
United States, or attempts to export or send from the United States,
any merchandise, article, or object contrary to any U.S. law or
regulation, or receives, conceals, buys, sells, or in any manner
facilitates the transportation, concealment, or sale of such
merchandise, article, or object, prior to exportation, knowing the same
to be intended for exportation contrary to any U.S. law or regulation,
faces up to 10 years' imprisonment, a fine, or both, if convicted.
At any point in time, and to the extent consistent with United
States policy, the FEMA Administrator may determine additional
materials to be subject to this allocation order. Upon a determination
under section 101(b) of the DPA that an additional material is a scarce
and critical material essential for national defense, and that being
allocated to domestic use under this allocation order is the only way
to meet national defense requirements without significant disruption to
the domestic markets, the Administrator will include these additional
materials in this allocation order, and will provide notification of
this decision through publication in the Federal Register.
III. Regulatory Procedure and Analyses
A. Temporary Rule With Immediate Effective Date
Agency rulemaking is generally governed by the agency rulemaking
provisions of the Administrative Procedure Act (APA). See 5 U.S.C. 553.
Such provisions generally require that, unless the rule falls within
one of a number of enumerated exceptions, or unless another statute
exempts the rulemaking from the requirements of the APA, FEMA must
publish a notice of proposed rulemaking in the Federal Register that
provides interested persons an opportunity to submit written data,
views, or arguments, prior to finalization of regulatory requirements.
Section 553(b)(B) authorizes a department or agency to dispense with
the prior notice and opportunity for public comment requirement when
the agency, for ``good cause,'' finds that notice and public comment
thereon are impracticable, unnecessary, or contrary to the public
interest.
This rule is exempt from the APA under section 709(a) of the Act,
50 U.S.C. 4559(a). Instead, this rule is issued subject to the
provisions of section 709(b). Pursuant to section 709(b)(2) of the Act,
the Administrator has concluded, based on the facts related to the
COVID-19 pandemic, which already have been summarized in this document,
that, with respect to this temporary rule, urgent and compelling
circumstances make compliance with the notice and comment requirements
of section 709(b)(1) of the Act, 50 U.S.C. 4559(b)(1), impracticable.
If final regulations become necessary, an opportunity for public
comment will be provided for not less than 30 days before such
regulations become final, pursuant to section 709(b)(2)(C) of the Act,
50 U.S.C. 4559(b)(2)(C).
Furthermore, the same facts that warrant waiver under section
709(b)(2) of the Act would constitute good cause for FEMA to determine,
under the APA, that notice and public comment thereon are impractical,
unnecessary, or contrary to the public interest, and that the temporary
rule should become effective upon display at the Federal Register.
As the President has noted, although the Federal Government, along
with State and local governments, have taken preventative and proactive
measures to slow the spread of the virus SARS-CoV-2, and the disease it
causes, COVID-19, and to treat those affected. The spread of COVID-19
within the Nation's communities threatens to strain the Nation's
healthcare systems. It is imperative that health and medical resources
needed to respond to the spread of COVID-19, including the PPE affected
by this rule, are allocated for domestic use as appropriate. This
temporary rule is needed to appropriately allocate scarce or threatened
items for domestic use.
The measures described in this rule are being issued on a temporary
basis. This temporary rule will cease to be in effect on August 10,
2020.
B. Executive Orders 12866 and 13563
Executive Orders 12866 and 13563 direct agencies to assess all
costs and benefits of available regulatory alternatives and, if
regulation is necessary, to select regulatory approaches that maximize
net benefits (including potential economic, environmental, and public
health and safety effects; distributive impacts; and equity). Executive
Order 13563 emphasizes the importance of quantifying both costs and
benefits, reducing costs, harmonizing rules, and promoting flexibility.
Section 3(f) of Executive Order 12866 defines a ``significant
regulatory action'' as an action that is likely to result in a
regulation (1) having an annual effect on the economy of $100 million
or more in any one year, or adversely and materially affecting a sector
of the economy, productivity, competition, jobs, the environment,
public health or safety, or State, local, or tribal governments or
communities (also referred to as ``economically significant''); (2)
creating a serious inconsistency or otherwise interfering with an
action taken or planned by another agency; (3) materially altering
[[Page 20199]]
the budgetary impacts of entitlement grants, user fees, or loan
programs or the rights and obligations of recipients thereof; or (4)
raising novel legal or policy issues arising out of legal mandates, the
President's priorities, or the principles set forth in the Executive
Order.
The Office of Management and Budget has designated this temporary
rule as an economically significant regulatory action. Given that the
temporary rule is a significant regulatory action, FEMA proceeds under
the emergency provision of Executive Order 12866, section 6(a)(3)(D)
based on the need for immediate action, as described above.
C. Regulatory Flexibility Act
The Regulatory Flexibility Act (RFA) generally requires that when
an agency issues a proposed rule, or a final rule that the agency
issues under 5 U.S.C. 553 after being required by that section or any
other law to publish a general notice of proposed rulemaking, the
agency must prepare a regulatory flexibility analysis that meets the
requirements of the RFA and publish such analysis in the Federal
Register. 5 U.S.C. 603, 604.
This is neither a proposed rule, nor a final rule that the agency
has issued under 5 U.S.C. 553 of this title after being required by
that section or any other law to publish a general notice of proposed
rulemaking. This is a temporary rule issued without a prior proposed
rule, under the separate authority of the Defense Production Act of
1950. Accordingly, a regulatory flexibility analysis is not required.
D. Unfunded Mandates Reform Act
Section 202 of the Unfunded Mandates Reform Act of 1995 (Unfunded
Mandates Act), 2 U.S.C. 1532, requires that covered agencies prepare a
budgetary impact statement before promulgating a rule that includes any
Federal mandate that may result in the expenditure by State, local, and
tribal governments, in the aggregate, or by the private sector, of $100
million in 1995 dollars, updated annually for inflation. Currently,
that threshold is approximately $172 million. If a budgetary impact
statement is required, section 205 of the Unfunded Mandates Act also
requires covered agencies to identify and consider a reasonable number
of regulatory alternatives before promulgating a rule. DHS has
determined that this rule is not expected to result in expenditures by
State, local, and tribal governments, or by the private sector, of $172
million or more in any one year. This rule imposes no requirements on
State, local, and tribal governments and, therefore, cannot require
them to expend any funds, let alone $172 million. To the extent that
this rule affects the private sector, it only prohibits conduct, namely
certain exports. It does not require any private sector expenditures
within the meaning of the Unfunded Mandates Act. Further, the rule is
excluded from the Unfunded Mandates Act under 2 U.S.C. 1503(4) and (5).
E. National Environmental Policy Act (NEPA)
Under the National Environmental Policy Act of 1969 (NEPA), as
amended, 42 U.S.C. 4321 et seq., an agency must prepare an
environmental assessment or environmental impact statement for any
rulemaking that significantly affects the quality of the human
environment. FEMA has determined that this rulemaking does not
significantly affect the quality of the human environment and
consequently has not prepared an environmental assessment or
environmental impact statement.
Rulemaking is a major Federal action subject to NEPA. Categorical
exclusion A3 included in the list of exclusion categories at Department
of Homeland Security Instruction Manual 023-01-001-01, Revision 01,
Implementation of the National Environmental Policy Act, Appendix A,
issued November 6, 2014, covers the promulgation of rules, issuance of
rulings or interpretations, and the development and publication of
policies, orders, directives, notices, procedures, manuals, and
advisory circulars if they meet certain criteria provided in A3(a-f).
This interim final rule meets Categorical Exclusion A3(a), ``Those of a
strictly administrative or procedural nature''.
F. Executive Order 13132: Federalism
This rule has been reviewed under Executive Order 13132,
Federalism, 64 FR 43255 (August 4, 1999). That Executive Order imposes
certain requirements on agencies formulating and implementing policies
or regulations that preempt State law or that have federalism
implications. DHS has determined that this temporary rule will not have
a substantial direct effect 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.
Furthermore, there are no provisions in this rule that impose direct
compliance costs on State and local governments. Accordingly, DHS
believes that the rule does not warrant additional analysis under
Executive Order 13132.
G. Congressional Review Act
Under the Congressional Review of Agency Rulemaking Act (CRA), 5
U.S.C. 801-808, before a rule can take effect, the Federal agency
promulgating the rule must: Submit to Congress and to the Government
Accountability Office (GAO) a copy of the rule; a concise general
statement relating to the rule, including whether it is a major rule;
the proposed effective date of the rule; a copy of any cost-benefit
analysis; descriptions of the agency's actions under the Regulatory
Flexibility Act and the Unfunded Mandates Reform Act; and any other
information or statements required by relevant executive orders.
FEMA has sent this rule to the Congress and to GAO pursuant to the
CRA. The Office of Information and Regulatory affairs has determined
that this rule is a ``major rule'' within the meaning of the CRA. As
this rule is being promulgated under the good cause exception to notice
and comment under the Administrative Procedure Act, there is not a
required delay in the effective date. See 5 U.S.C. 808.
List of Subjects in 44 CFR Part 328
Administrative practice and procedure, Business and industry,
Government contracts, Health or medical resource, Hoarding,
Investigations, Materials, National defense, Scarce materials,
Strategic and critical materials, Threatened materials.
Accordingly, for the reasons set forth in the preamble, and
effective from April 7, 2020 until August 10, 2020, chapter I of title
44 of the Code of Federal Regulations is amended by adding part 328 to
read as follows:
PART 328--COVID-19 ALLOCATION ORDERS AND PRIORITY ORDER REVIEW
UNDER THE DEFENSE PRODUCTION ACT
Sec.
328.101 Basis and purpose.
328.102 Requirements.
328.103 Designation of covered materials.
328.104 Investigations and injunctions; penalties.
Authority: Sections 101 et seq. of the Defense Production Act
of 1950, 50 U.S.C. 4511, et seq.; Executive Order 13909, 85 FR 16227
(Mar. 23, 2020); Executive Order 13911, 85 FR 18403 (Apr. 1, 2020);
DHS Delegation 09052, Rev. 00.1 (Apr. 1, 2020); Presidential
Memorandum on Allocating Certain Scarce or Threatened Health and
Medical Resources to Domestic Use (April 3, 2020).
Sec. 328.101 Basis and purpose.
(a) Basis. These rules are issued pursuant to section 101 of the
Defense Production Act of 1950, as amended, 50
[[Page 20200]]
U.S.C. 4511, and complementary authorities, including such authorities
as are contained in subchapter III of chapter 55 of title 50, United
States Code (50 U.S.C. 4554, 4555, 4556, and 4559), which have been
delegated to FEMA.
(b) Purpose. The purpose of these rules is to aid the response of
the United States to the spread of COVID-19 by ensuring that scarce or
threatened health and medical resources are appropriately allocated for
domestic use.
Sec. 328.102 Requirements.
(a) Allocation Order and Requirement for the Administrator's
Approval. All shipments of covered materials, as designated in Sec.
328.103, shall be allocated for domestic use, and may not be exported
from the United States without explicit approval by FEMA.
(b) Procedures. U.S. Customs and Border Protection (CBP), in
coordination with such other officials as may be appropriate, will
notify FEMA of an intended export of covered materials. CBP must
temporarily detain any shipment of such covered materials, pending the
Administrator's determination whether to return for domestic use or
issue a rated order for part or all of the shipment, pursuant to the
Administrator's delegated authorities. The Administrator will make such
a determination within a reasonable timeframe after notification of an
intended export.
(c) Administrator's Determination. In making the determination
described in paragraph (b) of this section, the Administrator may
consult other agencies and will consider the totality of the
circumstances, including the following factors:
(1) The need to ensure that scarce or threatened items are
appropriately allocated for domestic use;
(2) minimization of disruption to the supply chain, both
domestically and abroad;
(3) the circumstances surrounding the distribution of the materials
and potential hoarding or price-gouging concerns;
(4) the quantity and quality of the materials;
(5) humanitarian considerations; and
(6) international relations and diplomatic considerations.
(d) Exemption.
(1) The Administrator has determined in the interest of promoting
the national defense to generally allow the export of covered materials
from shipments made by or on behalf of U.S. manufacturers with
continuous export agreements with customers in other countries since at
least January 1, 2020, so long as at least 80 percent of such
manufacturer's domestic production of such covered materials, on a per
item basis, was distributed in the United States in the preceding 12
months. If FEMA determines that a shipment of covered materials falls
within this exemption, such materials may be exported without further
review by FEMA, provided that the Administrator may waive this
exemption and fully review shipments of covered materials under
paragraph (b) of this section, if the Administrator determines that
doing so is necessary or appropriate to promote the national defense.
FEMA will communicate to CBP regarding the application of this
exemption to shipments identified by CBP.
(2) The Administrator may establish, in his discretion, additional
exemptions that he determines necessary or appropriate to promote the
national defense and will announce any such exemptions by notice in the
Federal Register.
(e) Exportations prohibited. The exportation of covered materials
other than in accordance with this section is prohibited.
Sec. 328.103 Designation of covered materials.
(a) The Administrator has designated the following materials as
``covered materials'' under this part:
(1) N95 Filtering Facepiece Respirators, including devices that are
disposable half-face-piece non-powered air-purifying particulate
respirators intended for use to cover the nose and mouth of the wearer
to help reduce wearer exposure to pathogenic biological airborne
particulates;
(2) Other Filtering Facepiece Respirators (e.g., those designated
as N99, N100, R95, R99, R100, or P95, P99, P100), including single-use,
disposable half-mask respiratory protective devices that cover the
user's airway (nose and mouth) and offer protection from particulate
materials at an N95 filtration efficiency level per 42 CFR 84.181;
(3) Elastomeric, air-purifying respirators and appropriate
particulate filters/cartridges;
(4) PPE surgical masks, including masks that cover the user's nose
and mouth and provide a physical barrier to fluids and particulate
materials; and
(5) PPE gloves or surgical gloves, including those defined at 21
CFR 880.6250 (exam gloves) and 878.4460 (surgical gloves) and such
gloves intended for the same purposes.
(b) Upon determination that additional items are scarce and
necessary for national defense, and that consideration under this
allocation order is the only way to meet national defense requirements
without significant disruption to the domestic markets, the
Administrator may designate additional materials as ``covered
materials'' in the list provided above. The Administrator will publish
notice of these additional ``covered materials'' in the Federal
Register.
Sec. 328.104 Investigations and injunctions; penalties.
(a) To administer or enforce this subpart, the Administrator may
exercise the authorities available under section 705 of the Defense
Production Act of 1950, as amended, 50 U.S.C. 4555, including the
conduct of investigations, requests for information or testimony, and
inspections of records or premises. Before such authorities are
utilized, the Administrator will determine the scope and purpose of the
investigation, inspection, or inquiry, and be assured that no adequate
and authoritative data are available from any Federal or other
responsible agency.
(b) Whenever, in the judgment of the Administrator, any person has
engaged or is about to engage in any acts or practices that constitute
or will constitute a violation of any provision of this subpart, or
order issued thereunder, the Administrator may exercise the authorities
available under section 706 of the Defense Production Act of 1950, as
amended, 50 U.S.C. 4556, including applying for a preliminary,
permanent, or temporary injunction, restraining order, or other order
to enforce compliance with this subpart.
(c) Any person who willfully engages in violations of this part is
subject to penalties available under section 103 of the Defense
Production Act of 1950, as amended, 50 U.S.C. 4513, or other available
authority.
Pete Gaynor,
Administrator, Federal Emergency Management Agency.
[FR Doc. 2020-07659 Filed 4-8-20; 5:15 pm]
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