Denial of Petition for Reconsideration; Temporary Exemption From Motor Vehicle Safety and Bumper Standards |
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Topics: Federal Motor Vehicle Safety Standards
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James Clayton Owens
National Highway Traffic Safety Administration
7 April 2020
[Federal Register Volume 85, Number 67 (Tuesday, April 7, 2020)]
[Rules and Regulations]
[Pages 19393-19396]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-06403]
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DEPARTMENT OF TRANSPORTATION
National Highway Traffic Safety Administration
49 CFR Part 555
[Docket No. NHTSA-2018-0103]
Denial of Petition for Reconsideration; Temporary Exemption From
Motor Vehicle Safety and Bumper Standards
AGENCY: National Highway Traffic Safety Administration (NHTSA),
Department of Transportation (DOT).
ACTION: Denial of petition for reconsideration.
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SUMMARY: This document denies a petition for reconsideration submitted
by Advocates for Highway and Auto Safety, Center for Auto Safety,
Consumer Reports, Consumer Federation of America, and Ms. Joan
Claybrook (collectively, the ``Petitioners'') of a final rule amending
NHTSA's regulation on temporary exemption from the Federal Motor
Vehicle Safety Standards (FMVSS). The final rule eliminated the
provision calling for the agency to determine that an application for a
temporary exemption from any FMVSS or bumper standard or for a renewal
of exemption is complete before the agency publishes a notification
summarizing the application and soliciting public comments on it.
DATES: April 7, 2020.
FOR FURTHER INFORMATION CONTACT: Daniel Koblenz, Office of Chief
Counsel, National Highway Traffic Safety Administration, 1200 New
Jersey Avenue SE, Washington, DC 20590; Telephone: (202) 366-2992.
SUPPLEMENTARY INFORMATION:
Table of Contents
I. Background
II. Petition for Reconsideration and Agency Response
A. This Final Rule was Not Issued as a Direct Final Rule under
49 CFR 553.14
B. Immediate Adoption of a Final Rule Under the APA
C. Advantages of Removing Completeness Requirement
D. NHTSA Provided a Reasoned Justification for the Amendment
III. Conclusion
This document denies a petition for reconsideration submitted by
the Petitioners requesting reconsideration of a December 26, 2018 final
rule (83 FR 66158) amending NHTSA's regulation on temporary exemption
from the FMVSS. The intended effect of the final rule was to solicit
public comments on a petition more quickly than had been
[[Page 19394]]
the case under part 555 prior to the change in procedure.
I. Background
The National Traffic and Motor Vehicle Safety Act (Safety Act), as
amended, authorizes the Secretary of Transportation to exempt, on a
temporary basis, under specified circumstances, and on terms the
Secretary deems appropriate, motor vehicles from an FMVSS or bumper
standard. This authority is set forth at 49 U.S.C. 30113. The Secretary
has delegated the authority for implementing this section to NHTSA.\1\
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\1\ 49 CFR 1.94
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In exercising this authority, NHTSA must look comprehensively at
the request for exemption and find that an exemption would be
consistent with the public interest and with the objectives of the
Safety Act.\2\ In addition, the Secretary must make at least one of the
following more-focused findings, which NHTSA commonly refers to as the
``basis'' for the exemption:
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\2\ 49 U.S.C. 30113(b)(3)(A).
(i) compliance with the standard[s] [from which exemption is
sought] would cause substantial economic hardship to a manufacturer
that has tried to comply with the standard[s] in good faith;
(ii) the exemption would make easier the development or field
evaluation of a new motor vehicle safety feature providing a safety
level at least equal to the safety level of the standard;
(iii) the exemption would make the development or field
evaluation of a low-emission motor vehicle easier and would not
unreasonably lower the safety level of that vehicle; or
(iv) compliance with the standard would prevent the manufacturer
from selling a motor vehicle with an overall safety level at least
equal to the overall safety level of nonexempt vehicles.\3\
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\3\ 49 U.S.C. 30113(b)(3)(B).
Per the Safety Act, once NHTSA receives a petition for an
exemption, the agency is required to publish a notice of receipt of the
petition and provide the public the opportunity to comment. However,
NHTSA does have a certain amount of discretion to set procedural rules
regarding time and way in which a petition is filed, as well as the
contents of the petition.\4\
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\4\ 49 U.S.C. 30113(b)(2).
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NHTSA's procedural regulations implementing these statutory
requirements are codified at 49 CFR part 555, ``Temporary Exemption
from Motor Vehicle Safety and Bumper Standards.'' Per the requirements
in 49 CFR 555.5, a petition for a temporary exemption must, among other
things, provide supporting documentation that would enable NHTSA to
make the findings required to grant the exemption under one of the four
exemption bases. In addition, the petition must also explain why the
exemption would be in the public interest and consistent with the
objectives of the Safety Act. NHTSA's procedures for processing
exemption petitions once they are received are described in 49 CFR
555.7.
The final rule made no changes to the ability of the public to
comment on a published petition for exemption, nor to the substantive
requirements for a petition. The opportunity for the public to comment
on a petition remains the same today as it has always been: The agency
publishes a notification in the Federal Register summarizing the
application and inviting public comment on whether the application
should be granted or denied. Before NHTSA issued its December 26, 2018,
final rule (83 FR 66158), however, this Federal Register notification
would only be published after the agency determined that the
application was complete (i.e., that the application included all the
information required under 49 U.S.C. 30113 and 49 CFR part 555).
However, if NHTSA found that the application was incomplete, NHTSA
informed the applicant, pointed out the areas of insufficiency, and
stated that the application would not receive further consideration
until the required information was submitted. Prior to the final rule,
the agency would not make the application available to the public and
request public comment at this stage in the process unless the
additional required information was submitted. Only then would the
agency publish the notification requesting public comment.
Importantly, the final rule did not amend 49 CFR 555.7(d) or (e),
which describe what steps NHTSA must take after the agency determines
whether an exemption petition contains ``adequate justification'' to
grant the petition. 49 CFR 555.7(d) states that, if NHTSA determines
that the application does not contain adequate justification to grant
an exemption after considering the application and the public comments,
the Administrator denies the petition and notifies the petitioner in
writing. 49 CFR 555.7(e) states that, if the Administrator determines
that the application does contain adequate justification to grant the
petition, the Administrator grants the petition and notifies the
applicant in writing. Under both cases, the Administrator also
publishes a notification in the Federal Register stating the decision
to grant or deny the petition, and the reasons for the decision.
The December 26, 2018 final rule amended 49 CFR 555.7 by
eliminating the provision stating that the agency will not publish a
notice of receipt of an exemption petition to solicit public comments
prior to making a determination that the petition is ``complete.'' \5\
As was noted in the final rule, the reason for this was NHTSA's
difficulty in differentiating between incomplete petitions (for which,
prior to the final rule, a notice of receipt would not be published)
and petitions which were complete, but which failed to provide adequate
justification to grant (for which, prior to the final rule, a notice of
receipt would be published). This was especially the case in the
context of complex petitions involving new or innovative vehicle
designs, which has in the past led to delays in processing these
petitions.\6\ This final rule did not change the substantive
requirements that exemption petitions must meet; the amended regulation
continues to provide that the agency will determine whether an
application for exemption contains adequate justification in deciding
whether to grant or deny the application.\7\
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\5\ 83 FR 66158 (Dec. 26, 2018).
\6\ Id.
\7\ Id.
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II. Petition for Reconsideration and Agency Response
The Petitioners submitted a petition for reconsideration requesting
that NHTSA stay the effective date of the December 26, 2018 final rule,
and to proceed with a new notice of proposed rulemaking along with a
notice and comment period.
First, the Petitioners argue that by issuing the final rule, NHTSA
did not follow its direct final rulemaking procedures for amendments
that involve complex or controversial issues because, pursuant to 49
CFR 553.14, direct final rules may not be issued when they are likely
to result in ``adverse public comment.'' The Petitioners argue that the
final rule would have resulted in adverse public comments because the
new procedure is controversial among the Petitioners. (Under NHTSA's
direct final rulemaking procedures, if NHTSA receives an adverse
comment after issuing a direct final rule, the agency must withdraw the
rule and issue an NPRM proposing the amendment.)
Second, the Petitioners argue that, if the agency did not intend
for the final rule to be a direct final rule, the agency violated the
Administrative Procedure Act's (APA) notice and comment requirement
because the agency did not issue an NPRM proposing the change.
[[Page 19395]]
Third, the Petitioners argue that the final rule is not in the
public interest because it deprives the public of the opportunity to
``review issues of great importance to safety'' and permits the agency
to publish incomplete applications. The Petitioners believe that the
regulatory change would impose additional burdens on the public because
to fully evaluate an incomplete application and its implications on
safety, the public would be required to conduct independent research
and investigation to obtain missing information not contained in an
incomplete application.
Finally, the Petitioners argue that NHTSA has not put forth data or
evidence to show that the requirement of waiting until an application
is complete before publication has caused an undue delay or hardship on
any applicant, the agency, or the public.
A. This Final Rule was Not Issued as a Direct Final Rule Under 49 CFR
553.14
The Petitioners' assumption that NHTSA intended for this rulemaking
to be considered a direct final rule, subject to 49 CFR 553.14, is
incorrect. The APA includes two circumstances when notice and comment
rulemaking procedures do not apply: (1) ``to interpretative rules,
general statements of policy, or rules of agency organization,
procedure, or practice; or'' (2) ``when the agency for good cause finds
(and incorporates the finding and a brief statement of reasons therefor
in the rules issued) that notice and public procedure thereon are
impracticable, unnecessary, or contrary to the public interest.'' 5
U.S.C. 553(b). As described below, this rule falls into the first
exception, as a rule of agency procedure. NHTSA's direct final
rulemaking regulation is primarily directed at the second exception, as
it requires a threshold ``good cause'' finding. See 49 CFR 553.14.
In any event, the procedures in 49 CFR 553.14 are not mandatory. 49
CFR 553.14 states that if the Administrator makes a ``good cause''
finding, ``a direct final rule may [emphasis added] be issued''
according to the direct final rulemaking procedures. Likewise, it
provides that: ``[r]ules that the Administrator judges to be non-
controversial and unlikely to result in adverse public comment may
[emphasis added] be published as direct final rules,'' \8\ thereby
giving NHTSA discretion to publish a rule according to the specified
``direct final rule'' procedures. NHTSA did not purport to issue the
final rule that is the subject of this petition according to those
procedures. The petitioned final rule did not refer to 49 CFR 553.14
and instead expressly indicated that it was issued without notice and
comment pursuant to the APA exception for procedural rules in 5 U.S.C.
553(b)(3)(A).\9\ Petitioners do not support their claim that NHTSA
somehow acted ``in violation of'' its discretionary direct final
rulemaking procedures in 49 CFR 553.14, when the agency instead applied
a statutory exception in the APA.
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\8\ 49 CFR 553.14(a).
\9\ 83 FR 66158, 66159.
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B. Immediate Adoption of a Rule Under the APA
NHTSA fully complied with the APA when it issued a final rule for
immediate adoption without a notice and comment period. Section
553(b)(3)(A) of the APA (U.S.C., Title 5) provides that notice and
comment procedures do not apply to rules of agency organization,
procedure, or practice, except when notice or hearing is required by
statute. Under this section, an agency may issue a final rule without
seeking comment prior to the rulemaking. Procedural rules are agency
provisions that are primarily directed toward improving the efficient
and effective operations of an agency, not toward the determination of
the rights or interests of affected parties.\10\ A rule that simply
prescribes the manner in which the parties present themselves or their
viewpoints to the agency does not alter the underlying rights or
interests of the parties.\11\
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\10\ Clarian Health West, LLC v. Burwell, 206 F. Supp. 3d 393,
414 (D.D.C. 2016), rev'd on other grounds, Clarian Health West, LLC
v. Hargan, 878 F.3d 346 (DC Cir. 2017).
\11\ Inova Alexandria Hospital v. Shalala, 244 F.3d 342, 349
(2001).
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The purpose of the petitioned final rule is to expedite the
publishing of documents soliciting public comment on exemption
applications,\12\ which is directly related to improving the efficient
and effective operations of the agency. It amended a provision of
NHTSA's regulations concerning the agency's ``[p]rocessing of
applications.'' \13\ The final rule simply eliminated the provision
calling for the agency to determine that an application for exemption
is complete before publishing a notification summarizing an application
and soliciting public comments on it, which is a prescription of the
manner in which applicants present themselves to the agency. Therefore,
this procedural final rule is not directed toward the determination of
the rights or interests of the Petitioners as the Petitioners' public
interest argument seems to suggest; it does not alter the underlying
rights or interest of interested parties.
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\12\ 83 FR 66158 (Dec. 26, 2018).
\13\ See revised heading of 49 CFR 555.7.
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Petitioners' assertion that the final rule ``contravenes NHTSA's
notice-and-comment obligations under the Administrative Procedure Act''
is unpersuasive. NHTSA expressly found that the final rule met the
exception in APA section 553(b)(3)(A) because ``[t]he sole purpose of
this rule is to eliminate the provision calling for the agency to
determine that a petition is complete before the agency publishes a
notification summarizing the petition and soliciting public comments on
it. This rule does not impose any additional requirements on exemption
applicants or the public. Therefore, NHTSA has determined that notice
and public comment are unnecessary.'' \14\ Petitioners provided no
explanation for why they believe notice-and-comment procedures apply
notwithstanding the APA exception cited by the agency in the final
rule.
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\14\ 83 FR 66158, 66159--60.
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C. Advantages of Removing Completeness Determination Requirement
Contrary to the assertion by Petitioners, the subject final rule is
in the public's interest for several reasons. First, the final rule
increases transparency by giving the public the opportunity to
thoroughly review exemption applications that otherwise may not have
been disclosed to the public or subject to public input. Under the
prior rule, NHTSA first had to make a threshold finding before opening
a public docket on the petition. If NHTSA found that the application
was incomplete, NHTSA informed the applicant, pointed out the areas of
insufficiency, and stated that the application would not receive
further consideration until the required information was submitted. The
public did not have the opportunity to review the incomplete
application. Under the amended rule, the public can review incomplete
exemption applications.
Second, under the final rule, both the agency and the public can
comprehensively evaluate applications for exemption. Prior to the final
rule, only the agency would make a completeness determination, without
input on that issue from the public. The final rule increases the
public's opportunity to evaluate the application and provide input
because the agency will decide whether to grant an exemption
application, complete or not,
[[Page 19396]]
based on the application and the public comments. Among its comments,
the public can submit opinions as to whether the application is
complete. The public gets to see an application sooner as opposed to
not seeing it until NHTSA makes a threshold completeness determination.
The public can point out what it sees as insufficiencies to the agency;
and if the agency agrees, the application will be denied unless it is
later supplemented. If an application is supplemented, the public will
have access to any supplemental information to the same extent as if
the supplement happened before the application became public under the
old rule. In addition, the public can, if it so chooses, comment on
completeness, or on any other supplemental information submitted
through the public comment process.
Finally, the final rule does not impose additional requirements on
the public to perform research, as the Petitioners claimed without
support. Although published exemption applications may be incomplete,
NHTSA is still required to make an ``adequate justification''
determination based on the information provided by the applicant. An
application that lacks merit or critical information will be denied,
based on public input and the agency's analysis, regardless of whether
there is a threshold completeness determination. A determination that
an application is complete is not a determination that the application
should be granted. If NHTSA determines that the application does not
contain ``adequate justification,'' the Administrator denies it and
notifies the applicant in writing, pointing out the areas of
insufficiency.\15\ It is not the public's duty to perform research to
determine areas of insufficiency. The Administrator also publishes in
the Federal Register a notification of the denial and the reasons for
it, which is available to the public. Further, if a member of the
public believes the agency's explanation for granting an application
lacks sufficient supporting arguments and facts, he or she may seek to
have the agency reconsider the grant.
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\15\ 49 CFR 555.7(d).
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D. NHTSA Provided a Reasoned Justification for the Amendment
NHTSA articulated the purpose behind changing this procedural rule
in the preamble to the rule. Specifically, NHTSA changed its procedure
``to expedite the publishing of documents soliciting public comment on
exemption petitions.'' \16\ Petitioners' argument that ``NHTSA has put
forth no data or evidence in the Final Rule that the current
requirement of waiting until the application is complete before
publishing it in the Federal Register has caused undue delay or
hardship on any applicant, the agency, or the public'' lacks merit.
NHTSA provided a reasoned explanation of its change in procedure. See
F.C.C. v. Fox Television Stations, Inc., 556 U.S. 502, 515 (2009).
NHTSA explained how the prior procedure led to delays.\17\ The agency
also explained that the prior procedure was unnecessary under the
statute, particularly in light of the substantive determination it will
continue to make regarding whether a petition contains an adequate
justification.\18\ Petitioners' assertions regarding the public
interest have not convinced the agency that it should return to its
prior procedure, which would reduce transparency and delay the ability
of the public to obtain and comment on exemption applications.
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\16\ 83 FR 66158, 66159.
\17\ Id.
\18\ Id.
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III. Conclusion
For the reasons discussed above, the agency is denying the
Petitioners' petition for reconsideration of the December 26, 2018
final rule (83 FR 66158).
Issued in Washington, DC, under authority delegated in 49 CFR
1.95 and 501.4.
James Clayton Owens,
Acting Administrator.
[FR Doc. 2020-06403 Filed 4-6-20; 8:45 am]
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