Exemption From Operating Authority Regulations for Providers of Recreational Activities Publication: Federal Register Agency: Federal Motor Carrier Safety Administration Byline: Robin Hutcheson Date: 21 June 2023 Subjects: American Government , Buses

[Federal Register Volume 88, Number 118 (Wednesday, June 21, 2023)]
[Proposed Rules]
[Pages 40146-40160]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-13081]


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DEPARTMENT OF TRANSPORTATION

Federal Motor Carrier Safety Administration

49 CFR Part 372

[Docket No. FMCSA-2023-0007]
RIN 2126-AC57


Exemption From Operating Authority Regulations for Providers of 
Recreational Activities

AGENCY: Federal Motor Carrier Safety Administration (FMCSA), Department 
of Transportation (DOT).

ACTION: Notice of proposed rulemaking.

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SUMMARY: FMCSA proposes the implementation of the statutory exemption 
from its operating authority registration rules for providers of 
recreational activities. The exemption would apply to motor carriers 
operating a motor vehicle designed or used to transport between 9 and 
15 passengers (including the driver), whether operated alone or with a 
trailer attached to the transport vehicle, if the motor vehicle is 
operated by a person that provides recreational activities within a 150 
air-mile radius of the location at which passengers initially boarded 
the motor vehicle at the beginning of the trip. FMCSA also proposes to 
define recreational activities to clarify the scope of this exemption.

DATES: Comments must be received on or before August 21, 2023.

ADDRESSES: You may submit comments identified by Docket Number FMCSA-
2023-0007 using any of the following methods:
     Federal eRulemaking Portal: Go to https://www.regulations.gov/docket/FMCSA-2023-0007/document. Follow the online 
instructions for submitting comments.
     Mail: Dockets Operations, U.S. Department of 
Transportation, 1200 New Jersey Avenue SE, West Building, Ground Floor, 
Room W12-140, Washington, DC 20590-0001.
     Hand Delivery or Courier: Dockets Operations, U.S. 
Department of Transportation, 1200 New Jersey Avenue SE, West Building, 
Ground Floor, Room W12-140, Washington, DC 20590-0001, between 9 a.m. 
and 5 p.m., Monday through Friday, except Federal holidays. To be sure 
someone is there to help you, please call (202) 366-9317 or (202) 366-
9826 before visiting Dockets Operations.
     Fax: (202) 493-2251.

FOR FURTHER INFORMATION CONTACT: Mr. Antonio Harris, Registration, 
Licensing and Insurance Division, Office of Research and Registration, 
FMCSA, 1200 New Jersey Avenue SE, Washington, DC 20590-0001; (202) 366-
2964; antonio.harris@dot.gov. If you have questions on viewing or 
submitting material to the docket, call Dockets Operations at (202) 
366-9826.

SUPPLEMENTARY INFORMATION: FMCSA organizes this notice of proposed 
rulemaking (NPRM) as follows:

I. Public Participation and Request for Comments
    A. Submitting Comments
    B. Viewing Comments and Documents
    C. Privacy
II. Executive Summary
    A. Purpose and Summary of the Regulatory Action
    B. Summary of Major Provisions
    C. Costs and Benefits
III. Abbreviations
IV. Legal Basis
V. Background
VI. Discussion of Proposed Rulemaking
VII. Section-by-Section Analysis
VIII. Regulatory Analyses
    A. E.O. 12866 (Regulatory Planning and Review), E.O. 13563 
(Improving Regulation and Regulatory Review), E.O. 14094 
(Modernizing Regulatory Review), and DOT Regulatory Policies and 
Procedures
    B. Congressional Review Act
    C. Advance Notice of Proposed Rulemaking
    D. Regulatory Flexibility Act (Small Entities)
    E. Assistance for Small Entities
    F. Unfunded Mandates Reform Act of 1995
    G. Paperwork Reduction Act (Collection of Information)
    H. E.O. 13132 (Federalism)
    I. Privacy
    J. E.O. 13175 (Indian Tribal Governments)
    K. National Environmental Policy Act of 1969

I. Public Participation and Request for Comments

A. Submitting Comments

    If you submit a comment, please include the docket number for this 
NPRM (FMCSA-2023-0007), indicate the specific section of this document 
to which your comment applies, and provide a reason for each suggestion 
or recommendation. You may submit your comments and material online or 
by fax, mail, or hand delivery, but please use only one of these means. 
FMCSA recommends that you include your name and a mailing address, an 
email address, or a phone number in the body of your document so FMCSA 
can contact you if there are questions regarding your submission.
    To submit your comment online, go to https://www.regulations.gov/docket/FMCSA-2023-0007/document, click on this NPRM, click ``Comment,'' 
and type your comment into the text box on the following screen.

[[Page 40147]]

    If you submit your comments by mail or hand delivery, submit them 
in an unbound format, no larger than 8\1/2\ by 11 inches, suitable for 
copying and electronic filing. If you submit comments by mail and would 
like to know that they reached the facility, please enclose a stamped, 
self-addressed postcard or envelope.
    FMCSA will consider all comments and material received during the 
comment period.
Confidential Business Information (CBI)
    CBI is commercial or financial information that is both customarily 
and actually treated as private by its owner. Under the Freedom of 
Information Act (5 U.S.C. 552), CBI is exempt from public disclosure. 
If your comments responsive to the NPRM contain commercial or financial 
information that is customarily treated as private, that you actually 
treat as private, and that is relevant or responsive to the NPRM, it is 
important that you clearly designate the submitted comments as CBI. 
Please mark each page of your submission that constitutes CBI as 
``PROPIN'' to indicate it contains proprietary information. FMCSA will 
treat such marked submissions as confidential under the Freedom of 
Information Act, and they will not be placed in the public docket of 
the NPRM. Submissions containing CBI should be sent to Mr. Brian 
Dahlin, Chief, Regulatory Evaluation Division, Office of Policy, FMCSA, 
1200 New Jersey Avenue SE, Washington, DC 20590-0001. Any comments 
FMCSA receives not specifically designated as CBI will be placed in the 
public docket for this rulemaking.

B. Viewing Comments and Documents

    To view any documents mentioned as being available in the docket, 
go to https://www.regulations.gov/docket/FMCSA-2023-0007/document and 
choose the document to review. To view comments, click this NPRM, then 
click ``Browse Comments.'' If you do not have access to the internet, 
you may view the docket online by visiting Dockets Operations in Room 
W12-140 on the ground floor of the DOT West Building, 1200 New Jersey 
Avenue SE, Washington, DC 20590-0001, between 9 a.m. and 5 p.m., Monday 
through Friday, except Federal holidays. To be sure someone is there to 
help you, please call (202) 366-9317 or (202) 366-9826 before visiting 
Dockets Operations.

C. Privacy

    DOT solicits comments from the public to better inform its 
regulatory process, in accordance with 5 U.S.C. 553(c). DOT posts these 
comments, without edit, including any personal information the 
commenter provides, to www.regulations.gov, as described in the system 
of records notice (DOT/ALL 14--Federal Docket Management System), which 
can be reviewed at https://www.govinfo.gov/content/pkg/FR-2008-01-17/pdf/E8-785.pdf.

II. Executive Summary

A. Purpose and Summary of the Regulatory Action

    Section 23012 of the Infrastructure Investment and Jobs Act (IIJA) 
(Pub. L. 117-58, 135 Stat. 429 (H.R. 3684, Nov. 15, 2021)) amended 49 
U.S.C. 13506 by adding, in paragraph (b)(4), a new exemption from 
FMCSA's operating authority registration requirements. FMCSA proposes 
the addition of new regulatory text implementing this statutory 
exemption. The exemption from operating authority registration applies 
to motor carriers operating a motor vehicle designed or used to 
transport between 9 and 15 passengers (including the driver), whether 
operated alone or with a trailer attached to the transport vehicle, if 
the motor vehicle is operated by a person \1\ that provides 
recreational activities and the transportation is provided within a 150 
air-mile radius of the location at which passengers initially boarded 
the motor vehicle at the outset of the trip.
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    \1\ While the statute refers to a ``person,'' that term can 
refer both to an individual or to a motor carrier under the 
definitions of that term in 49 U.S.C. 13102(18) and 1 U.S.C. 1.
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    FMCSA also proposes to define recreational activities to clarify 
the scope of this exemption. The statute, which requires that the motor 
vehicle be operated ``by a person that provides recreational 
activities,'' does not define recreational activities. The proposed 
definition would clarify the types of recreational activities the 
Agency has determined would qualify for the exemption in 49 U.S.C. 
13506(b)(4). FMCSA limited the proposed definition of recreational 
activities to the types of activities that Congress outlined in the 
IIJA for another section that uses this term. Section 11512 provided 
examples of ``groups representing recreational activities and 
interests'' in subsection (c)(4) which provided some insight as to 
legislative intent for the term recreational activities in section 
23012. The definition FMCSA proposes in implementing section 23012 
includes activities Congress mentioned in section 11512 and also 
describes activities that fall outside the intended scope of the term. 
This language is intended to provide context of the activities within 
the scope of the exemption, based on the intent of Congress, and to 
allow sufficient flexibility for analysis of the term's applicability 
to future activities.

B. Costs and Benefits

    The cost impacts of the proposed definition include changes in 
paperwork, fees, and insurance costs associated with maintaining 
operating authority. Because there is no pre-existing definition of 
recreational activities, motor carriers may be interpreting their 
eligibility for the operating authority exemption in varying ways. 
Depending on current interpretations, this proposed rule would either 
increase, decrease, or have no incremental impact on the degree to 
which the operating authority exemptions are used relative to the 
baseline. Differences in interpretation between regulated entities and 
enforcement officials may be hindering consistent enforcement 
practices, thereby impacting business-related decisions in providing 
transportation for recreational activities. This rulemaking would 
resolve this information asymmetry and enforcement differences by 
creating a common understanding between FMCSA and motor carriers. 
Because this rulemaking may also lead to an increase in exemption use, 
it would benefit existing carriers by improving the efficiency of their 
business operations and increasing both consumer and producer surplus. 
For new potential providers of recreational activities that were not 
aware of this exemption, this rulemaking may encourage new entrants 
into the field.

III. Abbreviations

ANPRM Advance Notice of Proposed Rulemaking
BLS Bureau of Labor Statistics
CBI Confidential Business Information
CE Categorical Exclusion
CFR Code of Federal Regulations
DOL U.S. Department of Labor
DOT Department of Transportation
E.O. Executive Order
FMCSA Federal Motor Carrier Safety Administration
FMCSRs Federal Motor Carrier Safety Regulations
FR Federal Register
GDP Gross Domestic Product
ICR Information Collection Request
IRFA Initial Regulatory Flexibility Analysis
IIJA Infrastructure Investment and Jobs Act
MCMIS Motor Carrier Management Information System
NAICS North American Industry Classification System
NPRM Notice of Proposed Rulemaking
OEWS Occupational Employment and Wage Statistics
OMB Office of Management and Budget
PIA Privacy Impact Assessment

[[Page 40148]]

PTA Privacy Threshold Assessment
Secretary The Secretary of the Department of Transportation
SBA Small Business Administration
UMRA Unfunded Mandates Reform Act of 1995
URS Unified Registration System
U.S.C. United States Code
USDOT United States Department of Transportation

IV. Legal Basis for the Rulemaking

    Section 23012 of the IIJA (Pub. L. 117-58, 135 Stat. 429 (H.R. 
3684, Nov. 15, 2021)) amended 49 U.S.C. 13506 by adding a new exemption 
from the requirement to obtain operating authority registration for 
``providers of recreational activities'' operating passenger vehicles 
designed or used to transport between 9 and 15 passengers (including 
the driver) (see 49 U.S.C. 13506(b)(4)). The statute, which requires 
that the motor vehicle be operated ``by a person that provides 
recreational activities,'' does not define recreational activities. 
This NPRM proposes to define recreational activities to clarify the 
scope of the exemption applicability.
    Under 49 Code of Federal Regulations (CFR) 1.87(a)(5), the 
authority of the Secretary of the Department of Transportation (the 
Secretary) to carry out the functions relating to the registration 
requirements in 49 U.S.C. 13901 and 13902 is delegated to the FMCSA 
Administrator. Sections 13901 and 13902 generally require that any 
person that wishes to provide transportation subject to jurisdiction 
under subchapter I of chapter 135 \2\ must be registered as a motor 
carrier, defined in 49 U.S.C. 13102(14) as ``a person providing motor 
vehicle transportation for compensation.'' The requirements of these 
sections, which are enforced under Sec.  392.9a (``Operating 
authority''), are the basis for the rules governing applications for 
operating authority registration in 49 CFR part 365.
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    \2\ Absent an exemption, the Secretary has jurisdiction over 
transportation by motor carrier and the procurement of that 
transportation, to the extent that passengers, property, or both, 
are transported by motor carrier in interstate commerce (49 U.S.C. 
13501). This authority has been delegated to the FMCSA Administrator 
under 49 CFR 1.87(a)(3).
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V. Background

    Before commencing operations, any person desiring to engage in for-
hire interstate transportation of passengers, regardless of vehicle 
size or passenger seating capacity, must first obtain operating 
authority registration, unless a specific exemption applies (49 U.S.C. 
13102 (14), 13501, 13506, 13901, 13902, and 49 CFR part 365). The 
relevant regulations governing such operations derive from Title 49, 
Subtitle IV, Part B, and are frequently referred to as the ``commercial 
regulations,'' (49 U.S.C. 13102(14), 13902 and 49 CFR part 365). 
Historically, the regulations promulgated pursuant to this authority 
were largely economic in nature and did not contain new safety 
requirements. Today, the most substantial regulatory requirements 
remaining under this authority require for-hire non-exempt motor 
carriers to maintain evidence of financial responsibility on file with 
FMCSA at all times, regardless of whether the carrier is actively 
operating, and to maintain an active process agent filing designating 
an agent for the receipt of service of process in every state (49 CFR 
part 366 and 49 CFR 387.301T).\3\ The exemptions from the commercial 
regulations, including the exemption for providers of recreational 
activities, are enumerated in 49 U.S.C. 13506 and codified in 49 CFR 
part 372.
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    \3\ Though providers of recreational activities may not be 
required to maintain an active process agent filing with FMCSA, 
other State and Federal law may also require those providers to 
maintain a process agent in order to engage in business in more than 
one State. Accordingly, any cost associated with maintaining a 
process agent, generally, would not automatically be alleviated by 
this rulemaking.
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    Congress adopted multiple exemptions to these commercial 
regulations that provided financial relief for certain industries while 
still maintaining safety oversight over the same operators. Exemptions 
from the commercial regulations do not impede the Agency's oversight of 
operations subject to the Agency's separate safety jurisdiction 
codified in the Motor Carrier Act of 1935 (Pub. L. 74-255, 49 Stat. 
543, Aug. 9, 1935), as amended (the 1935 Act) (codified in 49 U.S.C. 
31502); the Motor Carrier Safety Act of 1984 (Pub. L. 98-554, Title II, 
98 Stat. 2832, Oct. 30, 1984), as amended (codified in 49 U.S.C. 
chapter 311); and the Commercial Motor Vehicle Safety Act of 1986 (Pub. 
L. 99-570, Title XII, 100 Stat. 3207-170, Oct. 27, 1986), as amended 
(codified in 49 U.S.C. chapter 313). A carrier may be exempt from the 
commercial regulations, relieving them of the obligation to obtain 
operating authority, file evidence of financial responsibility, and 
designation of a process agent. The statutory exemptions in 49 U.S.C. 
13506 however, relieve the carrier only of the obligation to file with 
FMCSA evidence of financial responsibility, not the obligation to 
maintain financial responsibility when engaged in operations. Thus, if 
the carrier is operating a commercial motor vehicle as defined in 49 
U.S.C. chapter 311, the carrier is still required to maintain minimum 
levels of financial responsibility in order to operate. (49 U.S.C. 
31138 and 49 CFR part 387, subpart B).
    The operating authority registration required under 49 U.S.C. 
13901, 13902, and 13906, provides FMCSA with information about motor 
carriers and their operations. Although the requirements for operating 
authority registration apply only to carriers subject to the Agency's 
commercial regulations, they also provide FMCSA with an opportunity to 
evaluate those potential new entrant motor carriers' willingness and 
ability to comply with all commercial and safety regulations (49 U.S.C. 
13902). This opportunity, consistent with the Agency's mission to 
reduce crashes and fatalities, allows FMCSA to prevent carriers who may 
pose a significant safety risk from entering the industry. Motor 
carriers operating vehicles for compensation, in interstate commerce 
and not subject to exemption are prohibited from operating without the 
required operating authority or beyond the scope of the operating 
authority granted (Sec.  392.9a). A motor carrier that violates this 
provision shall be ordered out of service and may be subject to 
penalties (Sec.  392.9a(b)).
    The Agency, however, also requires registration under its safety 
jurisdiction, 49 U.S.C. 31134. As a result, if the carrier has 
registered and received a USDOT number under FMCSA's safety 
jurisdiction, the Agency will still maintain adequate information to 
monitor the motor carrier's safety performance and compliance, even if 
the carrier is not required to obtain operating authority registration.
    FMCSA is required to register a motor carrier for operating 
authority registration under 49 U.S.C. 13902 only if the applicant is 
willing and able to comply with all statutory and regulatory 
requirements for registration (49 U.S.C. 13902, 49 U.S.C. 13906, and 49 
CFR part 365). To obtain operating authority registration, each 
applicant is required to file the appropriate form for the scope of its 
operations (e.g., to operate as a motor carrier of passengers). 
Applicants that have never held a USDOT number or any other 
registration issued by FMCSA must file the Unified Registration System 
(URS) online application (Form MCSA-1) to obtain a USDOT number and 
register for operating authority. Applicants that already have a USDOT 
number but desire to expand to an operation requiring operating 
authority, such as transporting passengers in interstate commerce for 
compensation, must file the ``Application for Motor Passenger

[[Page 40149]]

Carrier Authority'' (Form OP-1(P)), or other appropriate OP-1 series 
form for the proposed operation to register for operating authority 
(Sec.  365.105T), for a fee, currently $300. Again, among other 
requirements, the statutory requirements for registration require that 
the applicant have on file with FMCSA proof of liability insurance 
meeting the minimum levels of financial responsibility required (49 
U.S.C. 13902, 49 U.S.C. 13906, and 49 CFR part 365). Motor carriers 
must submit the ``Motor Carrier Automobile Bodily Injury and Property 
Damage Liability Certificate of Insurance'' (Form BMC-91, for a single 
insurance provider, or Form BMC-91X, for an aggregation of insurance 
coverage) to satisfy the financial responsibility requirements. A 
registration remains in effect only as long as the registrant continues 
to satisfy these financial responsibility requirements in 49 U.S.C. 
13906.
    Before the enactment of section 23012 of the IIJA, a provider of 
recreational activities operating as a motor carrier of passengers was 
required to maintain insurance at the minimum prescribed levels \4\ for 
the entire year--including the months during which the provider was not 
operating. As a result, some providers of recreational activities were 
voluntarily revoking their operating authority registrations \5\ during 
the off-season months by filing Form OCE-46 so that they did not need 
to maintain insurance at the minimum prescribed levels during those 
months. To resume operations, the providers were then required to 
obtain adequate financial responsibility, ensure evidence of financial 
responsibility is filed with FMCSA on Form BMC-91 or BMC-91X, and 
request to reinstate their operating authority registrations by 
submitting the ``Motor Carrier Records Change'' (MCSA-5889) either 
online or by paper during the months when they were operating, for an 
additional fee, currently $80.\6\
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    \4\ The minimum levels of financial responsibility required to 
be maintained by for-hire motor carriers of passengers operating 
motor vehicles in interstate or foreign commerce can be found in 49 
CFR part 387, subpart B. Section 387.31 prohibits a motor carrier 
from operating a motor vehicle transporting passengers until the 
motor carrier has obtained and has in effect the minimum levels of 
financial responsibility as forth in Sec.  387.33. The minimum level 
of financial responsibility is $1,500,000 for for-hire motor 
carriers of passengers operating a vehicle with a seating capacity 
of 15 passengers or less, including the driver (Sec.  387.33T).
    \5\ It should be noted that these revocations did not affect the 
status of each carrier's safety registration (USDOT number 
registration under 49 U.S.C. 31134), which remained intact and was 
still required to be updated biennially by the motor carrier (Sec.  
390.201).
    \6\ The MCSA-5889 may be submitted by mail, fax, or filled out 
online. https://ask.fmcsa.dot.gov/app/answers/detail/a_id/213/session/L3RpbWUvMTQ0Nzg3MzYwOS9zaWQvQXlsamRRQm0=.

    Section 23012 of the IIJA created a new exemption from the 
requirement to obtain FMCSA operating authority registration for 
providers of recreational activities operating a motor vehicle 
designed or used to transport not fewer than 9, and not more than 15 
passengers (including the driver) whether operated alone or with a 
trailer \7\ attached to the transport vehicle if:
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    \7\ The exemption includes passenger carrier operators who may 
also be required to have and maintain operating authority to 
transport property. FMCSA recognizes that a property carrier may 
also be transporting property for hire within the scope of its 
recreational activities operation. The Agency believes that the 
number of carriers requiring additional operating authority to 
transport property, however, is extremely limited.

    1. The motor vehicle is operated by a person that provides 
recreational activities;
    2. The transportation is provided within a 150 air-mile radius 
of the location at which passengers initially boarded the motor 
vehicle at the outset of the trip; and
    3. In the case of a motor vehicle transporting passengers over a 
route between a place in a State and a place in another State, the 
person operating the motor vehicle is lawfully providing 
transportation of passengers over the entire route in accordance 
with applicable State law.

    In this NPRM, FMCSA is undertaking only to clarify the term 
recreational activities, as the Agency believes that the other 
provisions in section 23012 are unambiguous.
    The recreational activity industry is comprised of numerous 
companies, associations, and organizations that focus primarily on 
outdoor activities. Outdoor activities may include hunting, fishing, 
trapping, camping, exploring caves, nature study, bicycling, horseback 
riding, bird watching, motorcycling, ballooning, hang-gliding, hiking, 
tobogganing, sledding, sleigh riding, snowmobiling, skiing, skating, 
water sports, rock climbing, climbing observation towers, sport 
shooting, whitewater rafting, and other outdoor sport, game, or 
educational activities.
    Congress did not define the term recreational activities in the 
IIJA and there is no current definition in statute or regulation. The 
lack of a definition of recreational activities has caused confusion 
for the industry and safety oversight agencies that may result in 
myriad interpretations and a patchwork of compliance. This NPRM 
proposes to define recreational activities consistent with the Agency's 
understanding of congressional intent when establishing the 
exemption.\8\
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    \8\ As explained in section VI of this rulemaking, FMCSA's 
interpretation of the term recreational activities has been informed 
by the legislative history of the IIJA. This interpretation has been 
further informed by the Agency's experiences in applying the 
operating authority requirements, particularly by the questions and 
concerns FMCSA has received from motor carriers regarding voluntary 
revocation of operating authority, e.g., carriers wishing to cancel 
or decrease their insurance during the off season.
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VI. Discussion of Proposed Rulemaking

    FMCSA proposes a new Sec.  372.113 that outlines the exemption from 
operating authority registration for providers of recreational 
activities in 49 U.S.C. 13506(b)(4). This new section would reflect the 
statutory language and incorporate the exemption into the FMCSRs.
    The Agency also proposes a new definition of recreational 
activities to Sec.  372.107 which would provide a clear description of 
the types of activities that qualify for the exemption in 49 U.S.C. 
13506(b)(4). Based on the statute itself and Congress' use of the term 
elsewhere in the IIJA, FMCSA believes Congress intended to provide an 
exemption to providers of recreational activities that consist of 
outdoor experiences or excursions typically of a physical or athletic 
nature that do not have transportation as an integral part of the 
activity itself.
    In reaching this conclusion, FMCSA has drawn from the canons of 
statutory construction and applied the presumption of consistent usage. 
The U.S. Supreme Court has framed this presumption as ``a natural 
presumption that identical words used in different parts of the same 
act are intended to have the same meaning'' (Atlantic Cleaners & 
Dryers, Inc. v. United States, 286 U.S. 427, 433 (1932)). The 
presumption should be ``applied . . . pragmatically'' (Antonin Scalia & 
Bryan A. Garner, Reading Law: The Interpretation of Legal Texts 171 
(2012)). FMCSA's interpretation of the types of activities Congress 
intended to include in the term recreational activities is therefore 
potentially informed by Congress' use of the same term in section 11512 
of the IIJA, which directs the Secretary to conduct a nonhighway 
recreational fuel study. Subsection (c)(4) states the Secretary may 
consult with groups representing recreational activities and interests, 
including hiking, biking and mountain biking, horseback riding, water 
trails, snowshoeing, cross-country skiing, snowmobiling, off-highway 
motorcycling, all-terrain vehicles and other offroad motorized vehicle 
activities, and recreational trail advocates (23 U.S.C. 203 note).
    The application of this presumption does have limitations. Although 
the term recreational activities is found within the same act, it is 
used in

[[Page 40150]]

different titles of this lengthy legislation, and applies to different 
operating administrations within DOT. Nonetheless, while the use of 
this term in section 11512 is not dispositive of its meaning in section 
13506, it can still be potentially informative of Congress' intent. 
Applying the presumption of consistent usage pragmatically, the 
language in section 11512 potentially provides insight into the types 
of activities that Congress intended to be covered by the term 
recreational activities under section 13506 of the IIJA. Accordingly, 
FMCSA limited the proposed definition of recreational activities to 
similar types of activities, as informed by FMCSA's experience.\9\
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    \9\ See Footnote 8. For example, in response to a DOT notice 
requesting that the public identify and provide input on the 
Department's existing guidance documents that are good candidates 
for repeal, replacement, or modification (84 FR 1820, Feb. 5, 2019), 
the America Outdoors Association (AOA) submitted an undated comment 
to the Docket (received Apr. 8, 2019) requesting that FMCSA amend 
its guidance on operating authority, stating that the costs to 
reinstate operating authority were an unnecessary expense with no 
added safety benefit. See https://www.regulations.gov/comment/DOT-OST-2017-0069-2865. (The comment is also available in the docket for 
this rulemaking.) AOA requested, in part, that FMCSA provide an 
exemption from the operating authority requirements for 
transportation by 9 to 15 passenger vehicles, when such 
transportation is provided by an entity that provides recreational 
activities, is not for direct compensation, and is provided entirely 
within a 150 air-mile radius of trip origination, provided that 
drivers carry appropriate commercial driver's licenses if needed, 
the State in which the vehicle is registered has adopted Federal 
inspection standards, and the operator is in compliance with State 
requirements.
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    Based on these findings, FMCSA proposes to define recreational 
activities which qualify for the exemption under 49 U.S.C. 13506(b)(4) 
as

. . . activities consisting of an outdoor experience or excursion 
typically of a physical or athletic nature which require 
transportation for the sole purpose of moving customers to another 
location or locations where the experience or excursion will take 
place and collecting those customers to transport them back to the 
place of initial boarding or another outpost of the motor carrier.

    Recreational activities under this proposed definition would 
include things such as hiking, biking, horseback riding, canoeing, 
whitewater rafting, water trails, tubing, skiing, snowshoeing, 
snowmobiling, hunting, fishing, mountain climbing, and swimming. While 
this list of activities in the proposed definition is not all 
inclusive, it provides sufficient examples to clarify the specific 
types of activities that would qualify for the exemption.
    FMCSA believes that, by including the language a person ``that 
provides'' recreational activities in the exemption, Congress intended 
to limit the exemption to only those persons that are actually 
providing recreational activities. There is no reason to infer that 
Congress intended for the ``providers of recreational activities'' 
exemption to apply to persons providing transportation as their core 
business or providing transportation concurrently with an activity 
(where the transportation is no longer incidental to the activity 
itself). These types of activities are distinct from those contemplated 
by Congress as exempt because the act of transporting passengers from 
one location to another is the central aspect of the service that the 
motor carriers are providing.
    For instance, FMCSA does not believe Congress intended to exempt 
activities where the service provided by the motor carriers mainly 
focuses on transportation from one location to another. In such cases, 
the motor carrier's business is in fact selling transportation--not 
providing recreational activities. A bus company offering scheduled 
route service with multiple stops would not fall within the exemption, 
for example, merely because one of the scheduled stops was at or near a 
water park or a horseback riding stable. Likewise, motor carriers that 
advertise and provide alcohol, music, or other ``party'' activities on 
board the vehicle as the principal activity or purpose of the 
transportation would not be eligible for the exemption.\10\ In 
situations like those described above, the activity cannot be completed 
and has no purpose without the transportation. The transportation in 
such circumstances is integral to the activities, rather than 
incidental. Accordingly, the proposed definition in Sec.  372.107 would 
explicitly exclude any activity for which: (1) the activity offered or 
sold is occurring simultaneously with the transportation; or (2) the 
transportation is the primary service offered for sale. FMCSA solicits 
comment on whether the exclusions at the end of the proposed definition 
increase clarity. Should the agency include these exclusions at the end 
of the definition, remove them from the definition, or take another 
approach to communicate which activities would not fall within the 
definition in a final rule?
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    \10\ FMCSA specifically mentions these activities because the 
Agency has received questions from motor carriers regarding the 
applicability of the exemption to these activities.
---------------------------------------------------------------------------

    The exemption in 49 U.S.C. 13506(b)(4) is already in effect. This 
rulemaking is intended to codify the statute and provide clarity 
regarding which motor carriers qualify for the exemption. Motor 
carriers that qualify for the exemption in 49 U.S.C. 13506(b)(4) are 
not subject to the requirement to register for or maintain operating 
authority as a motor carrier of passengers.
    New motor carriers that need a USDOT number, even those that 
qualify for the exemption, would be required to register via URS (MCSA-
1). Such carriers would indicate in the Operation Classification 
section that they will be transporting passengers for compensation but 
that they are exempt pursuant to 49 U.S.C. 13506. Motor carriers with a 
USDOT number that do not currently have operating authority as motor 
carriers of passengers and would qualify for the exemption do not have 
to file Form OP-1(P) to obtain operating authority.
    Motor carriers that currently have operating authority as motor 
carriers of passengers and qualify for the exemption are able to 
voluntarily revoke their operating authority under 49 U.S.C. 13905(d) 
as discussed in the background section above. After doing so, these 
motor carriers are no longer required to obtain or reinstate operating 
authority and thus, no longer required to have their insurance coverage 
or process agent designation on file with FMCSA (49 CFR parts 365 and 
366 and Sec.  387.301T). If a motor carrier does not voluntarily revoke 
its operating authority registration and fails to maintain evidence of 
the required level of insurance coverage on file with FMCSA, its 
operating authority registration will be revoked involuntarily by 
FMCSA.
    These motor carriers would no longer need to have evidence of 
financial responsibility on file with FMCSA (through either Form BMC-91 
or BMC-91X). However, the inapplicability of the insurance coverage 
filing requirement in 49 CFR part 365 and Sec.  387.301T does not 
affect a motor carrier's obligation to maintain minimum levels of 
financial responsibility as set forth in Sec.  387.33. As discussed 
above in the background section, a provider of recreational activities 
operating as a motor carrier of passengers is required to maintain 
insurance at the minimum prescribed levels while they are in operation. 
Additionally, a motor carrier that is no longer subject to Federal 
insurance requirements while not in operation may nonetheless still be 
required to maintain insurance coverage to meet applicable State 
requirements in those States in which the motor carrier operates.

[[Page 40151]]

    Some motor carriers may have already voluntarily revoked their 
operating authority registration by filing Form OCE-46 under the 
exemption in 49 U.S.C. 13506(b)(4). Some of these motor carriers may 
have correctly revoked their operating authority because they meet the 
requirements in 49 U.S.C. 13506(b)(4) and provide transportation for 
activities that fall under the proposed definition in this rulemaking. 
If the Agency were to issue its proposed definition as a final rule, 
these exempt motor carriers would be permitted to continue to operate 
without operating authority. Other motor carriers may have incorrectly 
revoked their operating authority because they provide transportation 
for one or more activities that they mistakenly believed would fall 
under the scope of the statute, but do not, in fact, fall within such 
scope as clarified by the proposed definition in this rulemaking. These 
motor carriers are currently required, and would continue to be 
required, to reinstate their operating authority registration and have 
their insurance coverage on file with FMCSA in order to continue 
operating.\11\
---------------------------------------------------------------------------

    \11\ Motor carriers may reinstate their operating authority 
using the procedure detailed at https://ask.fmcsa.dot.gov/app/
answers/detail/a_id/213/~/how-do-i-make-my-mc%2Fff%2Fmx-number-
active-%28request-to-reinstate-or-reactivate.
---------------------------------------------------------------------------

VII. Section-by-Section Analysis

    This section-by-section analysis describes the proposed changes in 
numerical order.

Section 372.107 Definitions

    FMCSA would add a new paragraph (i), which would contain a 
definition for recreational activities.

Section 372.113 Providers of Recreational Activities

    FMCSA would add a new Sec.  372.113 to subpart A of 49 CFR part 
372. This new section would outline the exemption from operating 
authority registration in 49 U.S.C. 13506(b)(4).

VIII. Regulatory Analyses

A. Executive Order (E.O.) 12866 (Regulatory Planning and Review), E.O. 
13563 (Improving Regulation and Regulatory Review), E.O. 14094 
(Modernizing Regulatory Review), and DOT Regulatory Policies and 
Procedures

    FMCSA has considered the impact of this NPRM under E.O. 12866 (58 
FR 51735, Oct. 4, 1993), Regulatory Planning and Review, E.O. 13563 (76 
FR 3821, Jan. 21, 2011), Improving Regulation and Regulatory Review, 
and by E.O. 14094 (88 FR 21879, Apr. 11, 2023), Modernizing Regulatory 
Review. The Office of Information and Regulatory Affairs within the 
Office of Management and Budget (OMB) determined that this notice of 
proposed rulemaking is not a significant regulatory action under 
section 3(f) of E.O. 12866, as supplemented by E.O. 13563 and E.O. 
14094, and does not require an assessment of potential costs and 
benefits under section 6(a)(3) of that order. Accordingly, OMB has not 
reviewed it under that E.O.
Purpose
    This rulemaking would codify the exemption for providers of 
recreational activities in regulation and define recreational 
activities to clarify the scope of this exemption by providing a clear 
description of what types of recreational activities do and do not 
qualify for the exemption in 49 U.S.C. 13506(b)(4). This would ensure 
that providers of recreational activities are aware of their 
eligibility for the exemption from filing for operating authority that 
FMCSA proposes to add in new Sec.  372.113. Specifically, this 
rulemaking would affect motor carriers operating a motor vehicle 
designed or used to transport between 9 and 15 passengers (including 
the driver), whether operated alone or with a trailer attached to the 
transport vehicle, if the motor vehicle is operated by a person that 
provides recreational activities and the transportation is provided 
within a 150 air-mile radius of the location at which passengers 
initially boarded the motor vehicle at the outset of the trip.
    This proposed rule is to provide clarity to both motor carriers and 
enforcement officials regarding which carriers qualify for the new 
exemption in section 23012 of the IIJA as of November 15, 2021. Because 
Congress did not define recreational activities and there is no pre-
existing definition of recreational activities in statute or 
regulation, FMCSA proposes bringing the FMCSRs into alignment with the 
IIJA's exemption. This clarity would resolve possible information 
asymmetry currently affecting the regulated industry and enforcement 
officials as to which carriers qualify for the operating authority 
exemption.
Baseline
    For the purposes of this analysis, the changes proposed in this 
rule are compared to the baseline established by section 23012 of the 
IIJA and the current requirements for providers of recreational 
activities under 49 U.S.C. 13901 and 13902 and 49 CFR part 365. As 
discussed above, the IIJA created a new exemption from the requirement 
to obtain FMCSA operating authority registration for providers of 
recreational activities. Accordingly, this exemption has been available 
to these motor carriers since the IIJA was enacted on November 15, 
2021. Therefore, the incremental impacts of this proposed rule relative 
to the baseline lie in how the affected industry and enforcement 
officials have been interpreting the term in the absence of a 
definition in the FMCSRs.
Uncertainties
    The Agency relies on the Motor Carrier Management Information 
System (MCMIS) database to obtain information on commercial motor 
carriers subject to the FMCSRs. While MCMIS does contain data on 
passenger vehicle size (e.g., weight and capacity) and type, it does 
not track industry type, nor whether an operating authority exemption 
is applicable. Consequently, the Agency knows neither the magnitude of 
the population that would be affected by this rulemaking, nor the 
degree to which passenger carriers are currently taking advantage of 
the exemption. Therefore, FMCSA describes how different carriers would 
be impacted by costs and benefits on a per-unit basis, depending on 
their current behavior. The Agency invites the public to provide 
information on the size of this industry.
Costs
    The resulting cost impacts of the definitional clarification 
proposed in this rulemaking include changes in paperwork, fees, and 
insurance costs associated with maintaining operating authority. 
Because there is no pre-existing definition of recreational activities, 
motor carriers may be interpreting their eligibility for the operating 
authority exemption in varying ways. Depending on current 
interpretations, this proposed rule would either increase, decrease, or 
have no incremental impact on the degree to which the operating 
authority exemptions are used relative to the baseline. Because FMCSA 
is unable to ascertain how various carriers interpreted this exemption 
set forth by section 23012 of the IIJA in 2021, the Agency estimates 
the impacts of this rulemaking based on four hypothetical scenarios. 
The Agency also invites the public to provide additional information on 
the degree to which this exemption is being used.
Forms
    Currently, there are several forms that providers of recreational 
activities are responsible for submitting to FMCSA in

[[Page 40152]]

order to maintain operating authority registration. As detailed later 
in this analysis, the use of these forms, as explained in table 1, may 
change as a result of this proposed rule, depending on how the affected 
carriers are interpreting this exemption.

    Table 1--Forms Currently Used in Maintaining Operating Authority
------------------------------------------------------------------------
                  Form                           Affected groups
------------------------------------------------------------------------
Motor Carrier Automobile Bodily Injury   Carriers that must provide
 and Property Damage Liability            proof of liability insurance
 Certificate of Insurance (BMC-91 or      meeting the minimum levels of
 BMC-91X).                                financial responsibility.
Motor Carrier Records Change (MCSA-      Carriers reinstating operating
 5889).                                   authority.
Request for Revocation of Authority      Carriers voluntarily revoking
 Granted (OCE-46).                        operating authority.
Application for Motor Passenger Carrier  Carriers with an existing USDOT
 Authority (OP-1(P)).                     number wishing to expand to an
                                          operation requiring operating
                                          authority.
------------------------------------------------------------------------

    Tables 2 and 3 display the paperwork burden of these forms to 
private entities and to the Government, respectively. These estimates 
are based on the Information Collection Request (ICR) supporting 
statements associated with each form. For example, table 2 shows that 
Forms BMC-91 and BMC-91X are estimated to take 10 minutes to complete 
by an insurance claims and policy processing clerk at a wage rate \12\ 
of $38.72, leading to a paperwork burden of $6 (10 minutes x $38.72 = 
$6).13 14
---------------------------------------------------------------------------

    \12\ DOL, BLS. Occupational Employment and Wage Statistics 
(OEWS). National. May 2021. 43-9041 Insurance Claims and Policy 
Processing Clerks. Available at: https://www.bls.gov/oes/current/oes439041.htm (accessed Jan. 5, 2023).
    \13\ This estimate is based on the calculations used in the ICR 
titled, ``Financial Responsibility Motor Carriers, Freight 
Forwarders and Brokers,'' covered by OMB Control Number 2126-0017.
    \14\ The supporting statement for the ``Financial Responsibility 
Motor Carriers, Freight Forwarders and Brokers'' ICR estimates 
Government costs for Forms BMC-91 and BMC-91X at $0, as they are 
filed electronically.

                               Table 2--Paperwork Costs to Private Sector (2021$)
----------------------------------------------------------------------------------------------------------------
                                                     Hours to
            Paperwork                  Wage         submit form    Cost per form    Filing fee      Total cost
----------------------------------------------------------------------------------------------------------------
Forms BMC-91 or BMC-91X by                $38.72            0.17              $6  ..............              $6
 insurance claims processer.....
Form MCSA-5889 by office clerk..           31.90            0.25               8              80              88
Form OCE-46 by office clerk.....           31.90            0.25               8  ..............               8
Form OP-1(P) by office clerk....           31.90               2              64             300             364
----------------------------------------------------------------------------------------------------------------
Estimates may not total due to rounding.


                                 Table 3--Paperwork Costs to Government (2021$)
----------------------------------------------------------------------------------------------------------------
                                                                   GS-9, step 5      Hours to
                            Paperwork                                  wage         submit form    Cost per form
----------------------------------------------------------------------------------------------------------------
Form MCSA-5889..................................................          $70.31            0.25             $18
Form OCE-46.....................................................           70.31            0.25              18
Form OP-1(P)....................................................           70.31             6.5             457
----------------------------------------------------------------------------------------------------------------
Estimates may not total due to rounding.

    FMCSA computes its estimates of labor costs using data gathered 
from several sources. Labor costs comprise wages, fringe benefits, and 
overhead. Fringe benefits include paid leave, bonuses and overtime pay, 
health and other types of insurance, retirement plans, and legally 
required benefits (Social Security, Medicare, unemployment insurance, 
and workers compensation insurance). Overhead includes any expenses to 
a firm associated with labor that are not part of employees' 
compensation; this typically includes many types of fixed costs of 
managing a body of employees, such as management and human resource 
staff salaries or payroll services. The economic costs of labor to a 
firm should include the costs of all forms of compensation and labor-
related expenses. For this analysis, costs of labor to a firm have been 
calculated relative to total compensation (base wages, plus fringe 
benefits, plus overhead).
    The primary source for industry wages is the median hourly wage 
data (May 2021) from the U.S. Department of Labor (DOL), Bureau of 
Labor Statistics (BLS), Occupational Employment and Wage Statistics 
(OEWS).\15\
---------------------------------------------------------------------------

    \15\ DOL, BLS. Occupational Employment and Wage Statistics 
(OEWS). National. May 2021. Available at: https://www.bls.gov/oes/current/oes_nat.htm/oesm21nat.zip (accessed Apr. 12, 2022).
---------------------------------------------------------------------------

    BLS does not publish data on fringe benefits for specific 
occupations, but it does for the broad industry groups in its Employer 
Costs for Employee Compensation release. For office clerk employees, 
this analysis uses an average hourly wage of $26.45 and average hourly 
benefits of $13.78 for private industry workers in ``transportation and 
warehousing'' \16\ to estimate that fringe benefits are equal to 52 
percent ($13.78 / $26.45) of wages. For insurance claims processors, 
this regulatory impact analysis uses an average hourly wage of $33.93 
and average hourly benefits of $16.92 for private industry workers in 
``financial activities'' \17\ to estimate that

[[Page 40153]]

fringe benefits are equal to 50 percent ($16.92 / $33.93) of wages.
---------------------------------------------------------------------------

    \16\ DOL, BLS. Table 4: Employer costs for Employee Compensation 
for private industry workers by occupation and industry group, Dec 
2019. Available at: https://www.bls.gov/news.release/archives/ecec_03192020.pdf (accessed Apr. 13, 2022).
    \17\ Ibid.
---------------------------------------------------------------------------

    For estimating the overhead rates on wages, the Agency used 
industry data gathered for the Truck Costing Model developed by the 
Upper Great Plains Transportation Institute, North Dakota State 
University as a proxy for the overhead cost of employees in the 
transportation intermediary and surety and trustee industries.\18\ 
Research conducted for this model found an average cost of $0.107 per 
mile of commercial motor vehicle operation for management and overhead, 
and $0.39 per mile for labor, indicating an overhead rate of 27 percent 
(27 percent = $0.107 / $0.39, rounded to the nearest whole percent).
---------------------------------------------------------------------------

    \18\ Berwick, Farooq. Truck Costing Model for Transportation 
Managers. North Dakota State University. Upper Great Plains 
Transportation Institute. August 2003. Appendix A, pp. 42-47. 
Available at: http://www.mountain-plains.org/pubs/pdf/MPC03-152.pdf 
(accessed Apr. 13, 2022).
---------------------------------------------------------------------------

    It is assumed that FMCSA reviewers will be Federal Government 
employees located in the Washington DC region at the GS-9 Step 5 wage 
rate.\19\ OPM does not publish annual rates that include fringe 
benefits or overhead. OMB does publish an object class analysis of the 
budget of the U.S. Government. The Object Class Analysis estimates 
that, in 2021, DOT spent $6,351 million in employee compensation and 
$2,840 million in employee benefits. FMCSA estimates a fringe benefit 
rate of 45 percent (2,840 / 6,351) for FMCSA personnel. FMCSA uses the 
DOT Volpe Center overhead rate of 64 percent for Federal personnel.\20\ 
The Volpe Center is a Federal fee-for-service research and innovation 
center in the DOT. Unlike most Federal agencies, Volpe receives no 
direct appropriation from Congress and must cover direct and indirect 
expenses through agreements with project sponsors.21 22 
These indirect costs are recovered through the overhead rate charged on 
direct labor costs. Volpe employees are compensated according to the 
Federal locality pay tables used for all Federal employees and their 
labor costs include the same employee benefits. Therefore, FMCSA 
believes that the overhead rate for Volpe personnel is similar to the 
rate for all DOT personnel.
---------------------------------------------------------------------------

    \19\ OPM Pay & Leave Salaries & Wages. Salary Table 2022-DCB, 
Hourly Basic (B) Rates by Grade and Step. Available at https://www.opm.gov/policy-data-oversight/pay-leave/salaries-wages/salary-tables/22Tables/html/DCB_h.aspx (accessed Jan. 5, 2023).
    \20\ DOT, Volpe Center. Volpe Project Costs. Available at: 
http://www.volpe.dot.gov/work-with-us/volpe-project-costs (accessed 
Apr. 9, 2022).
    \21\ DOT, Volpe Center. How to Initiate Work. Available at: 
http://www.volpe.dot.gov/work-with-us/how-initiate-work (accessed 
Apr. 13, 2022).
    \22\ DOT, Volpe Center. Volpe Project Costs. Available at: 
http://www.volpe.dot.gov/work-with-us/volpe-project-costs (accessed 
Apr. 13, 2022).
---------------------------------------------------------------------------

Insurance
    In addition to submitting forms to FMCSA, providers of recreational 
activities wishing to maintain a valid operating authority registration 
must also have proof of liability insurance filed with FMCSA, as 
explained in section V of this NPRM. The Agency estimates that such 
liability insurance currently costs entities an average of $190 per 
month for one vehicle, or $2,280 per year ($190 x 12 = $2,280).\23\ 
Using a range of fleet sizes for illustrative purposes, table 4 
presents the estimated costs currently associated with maintaining 
liability insurance by fleet size. The Agency invites the public to 
provide additional information on these estimates.
---------------------------------------------------------------------------

    \23\ Insuranks Online Insurance Comparison Marketplace. https://www.insuranks.com/commercial-van-insurance (accessed Oct. 31, 2022). 
These estimates are quoted from 12 different insurance companies, 
including Geico, Progressive, State Farm, and others. The monthly 
quotes were summed and then divided by 12 to obtain an estimated 
monthly average for the industry: ($115 + $120 + $130 + $183 + $165 
+ $180 + $195 + $210 + $221 + $232 + $254 + $270) / 12 = $190.

       Table 4--Current Insurance Estimates by Fleet Size (2022$)
------------------------------------------------------------------------
                                                     Monthly     Yearly
            Number of vehicles in fleet              premium    premium
------------------------------------------------------------------------
1.................................................       $190     $2,280
5.................................................        950     11,400
10................................................      1,900     22,800
------------------------------------------------------------------------

Scenario One: Increase in Exemption Use
    Scenario One includes existing providers of recreational activities 
that have been eligible for the operating authority exemption 
established by section 23012 of the IIJA in 2021 but are not utilizing 
it due to the definitional ambiguity of recreational activities. Upon 
issuance of this rulemaking, such carriers would understand they 
classify as a provider of recreational activities and are, therefore, 
eligible for this exemption. This would lead to an incremental increase 
in the number of operational authority exemptions being used relative 
to the baseline. As explained in detail below, these carriers would be 
impacted in different ways by the following costs and cost savings: 
financial responsibility compliance costs, operating authority 
registration fees, and paperwork costs.
Financial Responsibility Under Scenario One
    Carriers under Scenario One that are currently maintaining their 
operating authority registration year-round would experience cost 
savings associated with maintaining financial responsibility. As 
displayed in table 4, the Agency estimates that the liability insurance 
required for carriers to maintain operating authority registration 
costs an average of $2,280 per year for one vehicle. Carriers under 
this scenario would save on insurance costs during the months they are 
not in operation (such as off-season months). In other words, carriers 
operating one vehicle would only pay for the months they need to be 
insured instead of the full $2,280 per year, or $190 per month, to 
operate one vehicle.
    The Agency estimates a range of annual insurance cost savings from 
$190 to $17,100, depending on the number of vehicles a carrier owns and 
the number of months they currently maintain operating authority. These 
estimates are derived by multiplying the monthly insurance premiums 
according to fleet size in table 4 by the number of months they operate 
per year. Therefore, if a carrier with one vehicle is currently 
operating for one month per year, their annual cost savings would be 
$190 (1 month of insurance premiums x 1 vehicle). If a carrier with 10 
vehicles is currently operating for 9 months per year, their annual 
cost savings would be $1,900 multiplied by 9 months ($17,100).
    To illustrate further, table 5 displays estimated insurance cost 
savings of this rulemaking for a carrier operating five vehicles, as a 
result of no longer incurring year-round insurance costs. For example, 
using the values from table 4, the Agency estimates that a carrier 
operating five vehicles currently pays an average of $950 per month, or 
$11,400 per year, to maintain liability insurance. If such a carrier 
only maintained operating authority for 3 months, their cost savings 
would be $8,550 per year ($950 x 3 months = $2,850. $2,850-$11,400 =-
$8,550).

  Table 5--Insurance Costs by Number of Months in Operation: 5-Vehicle
                              Fleet (2022$)
------------------------------------------------------------------------
                                                      Yearly
                                                     premium      Cost
           Number of months in operation              for 5     savings
                                                     vehicles
------------------------------------------------------------------------
1.................................................       $950  ($10,450)
3.................................................      2,850    (8,550)
9.................................................      8,550    (2,850)
------------------------------------------------------------------------
Note: estimates may not total due to rounding.


[[Page 40154]]

    There would also be cost savings as a result of avoided insurance-
related administrative requirements. Currently, carriers must choose an 
insurance plan or other acceptable form of financial responsibility, 
and have proof filed with FMCSA whenever they apply for or reinstate 
operating authority. The Agency estimates that it takes carriers 8 
hours to research and identify which insurance company, financial 
surety, or bond provider they will use. Assuming this task is performed 
by an office clerk, this activity is estimated to cost each carrier 
$255 ($31.90 x 8 hours = $255).\24\ The Agency welcomes input from the 
public on the amount of time spent researching financial responsibility 
options.
---------------------------------------------------------------------------

    \24\ DOL, BLS. Occupational Employment and Wage Statistics 
(OEWS). National. May 2021. 43-9061 Office Clerks, General. 
Available at: https://www.bls.gov/oes/current/oes439061.htm 
(accessed Jan. 5, 2023).
---------------------------------------------------------------------------

    As displayed in table 2, carriers under Scenario One were also 
required to ensure that their financial responsibility provider submit 
Forms BMC-91 or BMC-91X to FMCSA at a cost of $6 per form. These 
administrative requirements for insurance were no longer required after 
the enactment of the IIJA in 2021; therefore, the definitional 
clarification in this proposed rule may lead to cost savings of $255 to 
the carrier and $6 to the insurance company.
Voluntary Revocation Under Scenario One
    As detailed in section V of this NPRM, some carriers under Scenario 
One were filing Form OCE-46 to voluntarily revoke their operating 
authority registrations during the off-season months so that they did 
not need to maintain insurance at the minimum prescribed levels during 
those months. To resume operations, the providers were then required to 
submit Form MCSA-5889 to reinstate their operating authority 
registrations during the months when they were operating. As displayed 
in tables 2 and 3, it is estimated to cost $8 to submit Form MCSA-5889, 
with a fee of $80 to carriers, and $18 to FMCSA.\25\ Form OCE-46 is 
also estimated to cost $8 per carrier and $18 for FMCSA processing 
time.\26\ As a result of this rulemaking, carriers under this scenario 
would no longer be subject to the costs associated with submitting Form 
MCSA-5889 or Form OCE-46.
---------------------------------------------------------------------------

    \25\ This estimate is based on the calculations used in the ICR 
titled, ``Motor Carrier Records Change Form'' (Form MCSA-5889), 
covered by OMB Control Number 2126-0060. The cost of a paper 
submission is $6 and the cost of an electronic submission is $0.
    \26\ This estimate is based on the calculations used in the ICR 
titled ``Request for Revocation of Authority Granted,'' covered by 
OMB Control Number 2126-0018.
---------------------------------------------------------------------------

Scenario Two: Decrease in Exemption Use
    It is also possible that this rulemaking would limit the use of 
this exemption for certain carriers. Because neither FMCSA nor Congress 
provided a definition of recreational activities, there may be carriers 
that incorrectly believed they are providers of recreational 
activities, but upon issuance of this rulemaking, would realize they 
are not. These carriers may currently be incorrectly utilizing this 
exemption and revoking their operating authority when they were not 
eligible to do so. Therefore, such carriers may incur a cost of $88 to 
submit Form MCSA-5889 as a result of this rulemaking for reinstatement 
of their operating authority (table 2). They would also need to resume 
paying for financial responsibility in order to maintain valid 
operating authority. Illustrative examples of possible insurance-
related costs are displayed in Tables 4 and 5. FMCSA invites public 
comment on the number of carriers that would no longer be using this 
exemption as a result of this rulemaking.
Scenario Three: No Incremental Change in Exemption Use
    There may also be eligible carriers that correctly interpreted 
Congress' intent and have been utilizing the exemption correctly since 
the IIJA's enactment. These carriers are not expected to be impacted by 
this proposed rule relative to the baseline. They have already gone 
through the steps of voluntarily revoking their operating authority 
with FMCSA, are maintaining financial responsibility only while in 
operation, and are not paying fees or completing paperwork associated 
with maintaining operating authority.
Scenario Four: New Providers
    This proposed rule may also affect eligible providers considering 
engaging in providing recreational activities in the future. If there 
are new carriers considering entering this field that were not aware of 
the IIJA exemption, they would no longer need to account for the 
following costs as a result of this rulemaking: year-round financial 
responsibility premiums, financial responsibility-related 
administrative costs, and operating authority fees and paperwork. The 
Agency invites public comment on the industry's trajectory and how many 
new entrants can be expected annually.
    Prior to the enactment of the IIJA, new providers of recreational 
activities would have had to submit the ``Application for Motor 
Passenger Carrier Authority'' (Form OP-1(P)).\27\ The Agency estimates 
that this form costs $64 with a $300 fee for carriers, and $457 in 
Government costs (Tables 2 and 3, respectively).\28\ Additionally, as 
described in the Financial Responsibility Under Scenario One section, 
the avoided insurance-related administrative costs would be $6 for 
insurance companies and $255 for carriers. An illustrative example of 
potential avoided insurance premium costs is presented in table 5.
---------------------------------------------------------------------------

    \27\ Applicants that have never held a USDOT number or any other 
registration issued by FMCSA must file the URS online application 
(Form MCSA-1) to obtain a USDOT number and register for operating 
authority.
    \28\ This estimate is based on calculations used in the ICR 
titled ``Licensing Applications for Motor Carrier Operating 
Authority,'' covered by OMB Control Number 2126-0016.
---------------------------------------------------------------------------

Government Costs
    These changes would not require additional training for enforcement 
personnel. The Agency expects that the definitional clarification set 
forth in this NPRM would be communicated to FMCSA personnel and the 
Agency's State-based enforcement partners through existing means, such 
as policy updates and ongoing training. The Agency would be impacted by 
the costs and cost savings associated with this NPRM, as outlined in 
table 3 ($457 for Form OP-1(P), $18 for Form OCE-46 and Form MCSA-
5889).
Benefits
    The affected entities would be providers of recreational activities 
that typically consist of physically demanding outdoor experiences or 
excursions that do not have transportation as an integral part of the 
activity itself. Overall, the outdoor recreation economy accounted for 
1.9 percent ($454 billion) of current-dollar gross domestic product 
(GDP) for the nation in 2021. Hawaii, Montana, Vermont, Alaska, and 
Maine are among the States where outdoor recreation as a percent of 
that States' GDP ranks the highest. For example, in 2021, outdoor 
recreation accounted for $4.4 billion of Hawaii's $91.1 billion overall 
GDP, or 4.8 percent--the highest proportion of any State. In terms of 
actual levels, the States that produced the highest outdoor recreation 
GDP in 2021 were California ($54.7 billion), Florida ($41.9 billion), 
and Texas ($37.5 billion).

[[Page 40155]]

    Differences in interpretation between regulated entities and 
enforcement officials may be hindering consistent enforcement 
practices, thereby impacting business-related decisions in providing 
transportation for recreational activities. This rulemaking would 
resolve this information asymmetry by creating a common understanding 
between FMCSA and motor carriers. Because this rulemaking may also lead 
to an increase in exemption use, it would benefit existing carriers by 
improving the efficiency of their business operations and increasing 
both consumer and producer surplus.
    For new potential providers of recreational activities that were 
not aware of this exemption, this rulemaking may encourage new entrants 
into the field. The costs of maintaining year-round financial 
responsibility and paying registration fees may have posed a barrier to 
entry that discouraged some entities from participating in this 
industry. Therefore, this proposed rule may introduce new businesses 
into the field, increase competition and market efficiency, and benefit 
consumers by creating more options when choosing a provider of 
recreational activities.

B. Congressional Review Act

    This proposed rule is not a major rule as defined under the 
Congressional Review Act (5 U.S.C. 801-808).\29\
---------------------------------------------------------------------------

    \29\ A major rule means any rule that OMB finds has resulted in 
or is likely to result in (a) an annual effect on the economy of 
$100 million or more; (b) a major increase in costs or prices for 
consumers, individual industries, geographic regions, Federal, 
State, or local government agencies; or (c) significant adverse 
effects on competition, employment, investment, productivity, 
innovation, or on the ability of United States-based enterprises to 
compete with foreign-based enterprises in domestic and export 
markets (Sec.  389.3).
---------------------------------------------------------------------------

C. Advance Notice of Proposed Rulemaking

    Under 49 U.S.C. 31136(g), FMCSA is required to publish an advance 
notice of proposed rulemaking (ANPRM) or proceed with a negotiated 
rulemaking, if a proposed rule is likely to lead to the promulgation of 
a major rule. As this proposed rule is not likely to result in the 
promulgation of a major rule, the Agency is not required to issue an 
ANPRM or to proceed with a negotiated rulemaking.

D. Regulatory Flexibility Act

    The Regulatory Flexibility Act of 1980, Public Law 96-354, 94 Stat. 
1164 (5 U.S.C. 601-612), as amended by the Small Business Regulatory 
Enforcement Fairness Act of 1996 (Pub. L. 104-121, 110 Stat. 857, March 
29, 1996) and the Small Business Jobs Act of 2010 (Pub. L. 111-240, 124 
Stat. 2504, September 27, 2010), requires Federal agencies to consider 
the effects of the regulatory action on small business and other small 
entities and to minimize any significant economic impact. The term 
small entities comprises small businesses and not-for-profit 
organizations that are independently owned and operated and are not 
dominant in their fields, and governmental jurisdictions with 
populations of less than 50,000. Accordingly, DOT policy requires an 
analysis of the impact of all regulations on small entities, and 
mandates that agencies strive to lessen any adverse effects on these 
businesses. FMCSA has not determined whether this proposed rule would 
have a significant economic impact on a substantial number of small 
entities. Therefore, FMCSA is publishing this initial regulatory 
flexibility analysis (IRFA) to aid the public in commenting on the 
potential small business impacts of the proposals in this NPRM. We 
invite all interested parties to submit data and information regarding 
the potential economic impact that would result from adoption of the 
proposals in this NPRM. We will consider all comments received in the 
public comment process when making a determination in the final 
regulatory flexibility analysis.
    An IRFA must contain the following:

    1. a description of the reasons why the action by the agency is 
being considered;
    2. a succinct statement of the objective of, and legal basis 
for, the proposed rule;
    3. a description of and, where feasible, an estimate of the 
number of small entities to which the proposed rule will apply;
    4. a description of the projected reporting, recordkeeping, and 
other compliance requirements of the proposed rule, including an 
estimate of the classes of small entities which will be subject to 
the requirement and the type of professional skills necessary for 
preparation of the report or record;
    5. an identification, to the extent practicable, of all relevant 
Federal rules that may duplicate, overlap, or conflict with the 
proposed rule.
    6. a description of any significant alternatives to the proposed 
rule which accomplish the stated objectives of applicable statutes 
and which minimize any significant economic impact of the proposed 
rule on small entities.
1. Why the Action by the Agency is Being Considered
    Section 23012 of the IIJA amended 49 U.S.C. 13506 by adding a new 
exemption in paragraph (b)(4) from the operating authority registration 
requirements. FMCSA is proposing to add a new regulatory section 
incorporating that statutory exemption and also including a definition 
for the exempt operations. The exemption from operating authority 
registration applies to motor carriers operating a motor vehicle 
designed or used to transport not fewer than 9, and not more than 15 
passengers (including the driver) whether operated alone or with a 
trailer attached to the transport vehicle, if the motor vehicle is 
operated by a person that provides recreational activities and the 
transportation is provided within a 150 air-mile radius of the location 
at which passengers initially boarded the motor vehicle at the outset 
of the trip. The new statutory exemption did not include a definition 
of recreational activities, creating some ambiguity in the exemption's 
applicability. The Agency is proposing to codify the exemption in 
regulation and to remove ambiguity by defining the term.
2. The Objectives of and Legal Basis for the Proposed Rule
    As discussed in section 1 of this IRFA, FMCSA is proposing to add a 
new regulatory section incorporating the statutory exemption in 49 
U.S.C. 13506 that was added by section 23012 of the IIJA (see 49 U.S.C. 
13506(b)(4)). The statutory provision, which relates to operating 
authority registration and requires, in part, that the motor vehicle be 
operated ``by a person that provides recreational activities,'' does 
not define recreational activities. This NPRM proposes to define 
recreational activities to clarify the scope of the exemption 
applicability.
    The FMCSA Administrator has the authority to carry out the 
functions relating to the registration requirements in 49 U.S.C. 13901 
and 13902, as delegated by the Secretary under Sec.  1.87(a)(5). The 
requirements of these sections, which are enforced under Sec.  392.9a 
(``Operating authority''), are the basis for the rules governing 
applications for operating authority registration in 49 CFR part 365.
3. A Description of, and Where Feasible an Estimate of, the Number of 
Small Entities to Which the Proposed Rule Will Apply
    Small entity is defined in 5 U.S.C. 601. Section 601(3) defines a 
small entity as having the same meaning as small business concern under 
section 3 of the Small Business Act. This includes any small business 
concern that is independently owned and operated and is not dominant in 
its field of operation. Section 601(4), likewise includes within the 
definition of small entities not-for-profit enterprises that are 
independently owned and operated and are not dominant in their fields 
of operation. Additionally, section 601(5) defines

[[Page 40156]]

small entities as governments of cities, counties, towns, townships, 
villages, school districts, or special districts with populations less 
than 50,000.
    This NPRM would affect providers of recreational activities to 
motor carriers operating a motor vehicle designed or used to transport 
not fewer than 9, and not more than 15 passengers (including the 
driver) whether operated alone or with a trailer attached to the 
transport vehicle, if the motor vehicle is operated by a person that 
provides recreational activities and the transportation is provided 
within a 150 air-mile radius of the location at which passengers 
initially boarded the motor vehicle at the outset of the trip. 
Providers of recreational activities affected by this proposed rule 
operate under many different North American Industry Classification 
System \30\ (NAICS) codes with differing size standards. FMCSA provides 
a wide range of NAICS codes in the recreational activities industry, in 
order to capture all of the potential NAICS codes that providers of 
recreational activities may operate under. In doing so, FMCSA is 
highlighting many entities that perform various other functions beyond 
transporting passengers to and from recreational activities. As shown 
in table 6 below, the SBA size standard for providers of recreational 
activities ranges from $8 million in revenue per year for the All Other 
Amusement Recreation Industries NAICS national industry, to $41.5 
million in revenue per year for Tour Operators and Racetracks.
---------------------------------------------------------------------------

    \30\ More information about NAICS is available at: http://www.census.gov/eos/www/naics/ (accessed Dec. 21, 2022).

           Table 6--SBA Size Standards for Selected Industries
                         [in millions of 2019$]
------------------------------------------------------------------------
                                                       SBA size standard
        NAICS code         NAICS industry description     in millions
------------------------------------------------------------------------
          Subsector 487--Scenic and Sightseeing Transportation
------------------------------------------------------------------------
487110...................  Scenic and Sightseeing                    $18
                            Transportation, Land.
487210...................  Scenic and Sightseeing                   12.5
                            Transportation, Water.
487990...................  Scenic and Sightseeing                     22
                            Transportation, Other.
------------------------------------------------------------------------
           Subsector 561--Administrative and Support Services
------------------------------------------------------------------------
561520...................  Tour Operators............               41.5
------------------------------------------------------------------------
Subsector 711--Performing Arts, Spectator Sports, and Related Industries
------------------------------------------------------------------------
711212...................  Racetracks................               41.5
711219...................  Other Spectator Sports....               14.5
------------------------------------------------------------------------
      Subsector 713--Amusement, Gambling, and Recreation Industries
------------------------------------------------------------------------
713910...................  Golf Courses and Country                 16.5
                            Clubs.
713920...................  Skiing Facilities.........               31.0
713940...................  Fitness and Recreational                 15.5
                            Sports Centers.
713990...................  All Other Amusement                       8.0
                            Recreation Industries.
------------------------------------------------------------------------

    FMCSA examined data from the 2017 Economic Census, the most recent 
Census for which data were available, to determine the percentage of 
firms that have revenue at or below SBA's thresholds within each of the 
NAICS industries.\31\ Boundaries for the revenue categories used in the 
Economic Census do not exactly coincide with the SBA thresholds. 
Instead, the SBA threshold generally falls between two different 
revenue categories. However, FMCSA was able to make reasonable 
estimates as to the percent of small entities within each NAICS code.
---------------------------------------------------------------------------

    \31\ U.S. Census Bureau. 2017 Economic Census. Available at: 
https://data.census.gov/cedsci/table?q=EC1700&n=48-49&tid=ECNSIZE2017.EC1700SIZEREVEST&hidePreview=true (accessed Dec. 
18, 2022).
---------------------------------------------------------------------------

    The Agency estimates that many entities affected by this NPRM may 
fall under the Scenic and Sightseeing Transportation NAICS subsector 
(487). Firms in this subsector utilize transportation equipment to 
provide recreation and entertainment. These operations are distinct 
from passenger transportation carried out for other types of for-hire 
transportation. The recreational activities involved are local in 
nature, usually involving a same-day return to the point of 
departure.\32\ Industry groups under this subsector include Scenic and 
Sightseeing Transportation, Land (4871), Scenic and Sightseeing 
Transportation, Water (4872), and Scenic and Sightseeing 
Transportation, Other (4879).
---------------------------------------------------------------------------

    \32\ US Census Bureau 2022 NAICS Definition. Available at 
https://www.census.gov/naics/?input=48&year=2022&details=487 
(accessed Jan. 5, 2023).
---------------------------------------------------------------------------

    The Scenic and Sightseeing Transportation, Land NAICS national 
industry (487110) has a revenue size standard of $18 million, which 
falls between two Economic Census revenue categories, $10 million and 
$25 million. This industry comprises firms engaged in various outdoor 
excursions, including horse-drawn sightseeing rides. The percentages of 
Scenic and Sightseeing Transportation, Land with revenue less than 
these amounts ranged from 97 percent to 98 percent. Because the SBA 
threshold is closer to the higher of these two boundaries, FMCSA has 
assumed that the percent of Scenic and Sightseeing Transportation, Land 
entities that are small will be closer to 98 percent and is using that 
figure.
    For Scenic and Sightseeing Transportation, Water (487210), the 
$12.5 million SBA threshold falls between two Economic Census revenue 
categories, $10 million and $25 million. Entities in this national 
industry are primarily engaged in providing scenic and sightseeing 
transportation on water, such as fishing boat charter operation. The 
percentages of Scenic and Sightseeing Transportation, Water with 
revenue less than these amounts ranged from 97 percent to 99 percent. 
Because

[[Page 40157]]

the SBA threshold is closer to the lower of these two boundaries, FMCSA 
has assumed that the percent of these entities that are small will be 
closer to 97 percent and is using that figure.
    Scenic and Sightseeing Transportation, Other (487990) focuses on 
all other scenic and sightseeing transportation, such as hot air 
balloon rides and glider excursions. The SBA size standard for this 
national industry is $22 million. The $22 million SBA threshold falls 
between two Economic Census revenue categories, $10 million and $25 
million. The percentages of these entities with revenue less than these 
amounts were 93 percent and 98 percent. Because the SBA threshold is 
closer to the higher of these two boundaries, FMCSA has assumed that 
the percent of these providers that are small will be closer to 98 
percent and is using that figure.
    Firms falling under the Travel Arrangement and Reservation Services 
industry group (5615) may also be impacted by this NPRM. This industry 
group comprises the Travel Agencies (561510), Tour Operators (561520), 
and Convention and Visitors Bureaus (561591) national industries.\33\ 
The Agency assumes that providers of recreational activities fall under 
the Tour Operators national industry.
---------------------------------------------------------------------------

    \33\ U.S. Census Bureau 2022 NAICS Definition. Available at 
https://www.census.gov/naics/?input=56&year=2022&details=5615 
(accessed Jan. 5, 2023).
---------------------------------------------------------------------------

    Tour Operators (561520) focuses on arranging and assembling tours, 
including travel or wholesale tour operators. The SBA size standard for 
this national industry is $41.5 million, which falls between two 
Economic Census revenue categories, $25 million and $100 million. The 
percentages of Tour Operators with revenue less than these amounts were 
92 percent and 100 percent. The Agency presents a high-end estimate of 
100 percent due to limitations in Economic Census data availability. 
Revenue data for firms with revenue less than $100,000, which would be 
considered small, are suppressed by the Economic Census to avoid 
disclosing for individual companies. Because the Agency is unable to 
ascertain the revenue for the suppressed firms, the high-end estimate 
assumes that such firms may fall under the $41.5 million SBA threshold 
and would be considered small. The low-end estimate assumes the 
suppressed firms are not small. Because the SBA threshold is closer to 
the lower of these two boundaries, FMCSA has assumed that the percent 
of Tour Operators that is small will be closer to 92 percent and is 
using that figure.
    The Agency estimates that many providers of recreational activities 
affected by this NPRM would also fall under the Arts, Entertainment, 
and Recreation sector (71). This sector includes a wide range of firms 
operating facilities that meet varied cultural, entertainment, and 
recreational interests of patrons.\34\ Subsectors under this group 
include Performing Arts, Spectator Sports, and Related Industries 
(711), Amusement, Gambling, and Recreational Industries (713), and 
others.
---------------------------------------------------------------------------

    \34\ U.S. Census Bureau 2022 NAICS Definition. Available at 
https://www.census.gov/naics/?input=71&year=2022&details=71 
(accessed Jan. 5, 2023).
---------------------------------------------------------------------------

    The industry groups under the Spectator Sports and Related 
Industries (711) subsector cover Spectator Sports (7112). Spectator 
Sports includes the Racetracks (711212) and Other Spectator Sports 
(711219) national industries.
    The Racetracks national industry (711212) focuses on firms 
operating racetracks without casinos, such as auto, motorcycle, 
snowmobile, and horse races. The SBA size standard for this national 
industry is $41.5 million. The $41.5 million SBA threshold falls 
between two Economic Census revenue categories, $25 million and $100 
million. The percentages of these entities with revenue less than these 
amounts were 83 percent and 100 percent.\35\ Because the SBA threshold 
is closer to the lower of these two boundaries, FMCSA has assumed that 
the percent of Racetracks entities that are small will be closer to 83 
percent and is using that figure.
---------------------------------------------------------------------------

    \35\ The Agency presents a high-end estimate of 100 percent due 
to limitations in Economic Census data availability. Revenue data 
for firms with revenue less than $100,000, which would be considered 
small, are suppressed by the Economic Census to avoid disclosing for 
individual companies. Because the Agency is unable to ascertain the 
revenue for the suppressed firms, the high-end estimate assumes that 
such firms may fall under the $41.5 million SBA threshold. The low-
end estimate assumes the suppressed firms are not small.
---------------------------------------------------------------------------

    Other Spectator Sports (711219) focuses on independent athletes, 
owners of racing participants (such as cars, dogs, and horses), and 
firms engaged in specialized services in support of said participants. 
The SBA size standard for this national industry is $14.5 million, 
which falls between two Economic Census revenue categories, $10 million 
and $25 million. The percentages of these entities with revenue less 
than these amounts were 82 percent and 100 percent.\36\ Because the SBA 
threshold is closer to the lower of these two boundaries, FMCSA has 
assumed that the percent of Other Spectator Sports entities that are 
small will be closer to 82 percent and is using that figure.
---------------------------------------------------------------------------

    \36\ The Agency presents a high-end estimate of 100 percent due 
to limitations in Economic Census data availability. Revenue data 
for firms with revenue less than $100,000, which would be considered 
small, are suppressed by the Economic Census. Because the Agency is 
unable to ascertain the revenue for the suppressed firms, the high-
end estimate assumes that such firms may fall under the $14.5 
million SBA threshold. The low-end estimate assumes the suppressed 
firms are not small.
---------------------------------------------------------------------------

    The industry groups under the Amusement, Gambling, and Recreation 
Industries (713) subsector include Amusement Parks and Arcades (7131), 
Gambling Industries (7132), and Other Amusement and Recreation 
Industries (7139).\37\ The Agency estimates the entities affected by 
this NPRM would fall into the third industry group, Other Amusement and 
Recreation Industries (7139). This group, as detailed below, covers 
firms operating golf courses and country clubs, skiing facilities, and 
all other amusement and recreation activities.\38\
---------------------------------------------------------------------------

    \37\ U.S. Census Bureau 2022 NAICS Definition. Available at 
https://www.census.gov/naics/?input=71&year=2022&details=713 
(accessed Jan. 5, 2023).
    \38\ U.S. Census Bureau 2022 NAICS Definition. Available at 
https://www.census.gov/naics/?input=71&year=2022&details=7139 
(accessed Jan. 5, 2023).
---------------------------------------------------------------------------

    Entities falling under Golf Courses and Country Clubs (713910) 
primarily engage in operating such facilities, and providing food and 
beverage services, equipment rental, or golf instruction. The SBA size 
standard for this national industry is $16.5 million, which falls 
between two Economic Census revenue categories, $10 million and $25 
million. The percentages of Golf Courses and Country Clubs with revenue 
less than these amounts were 95 percent and 99 percent. Because the SBA 
threshold is closer to the lower of these two boundaries, FMCSA has 
assumed that the percent of these entities that are small will be 
closer to 95 percent and is using that figure.
    Skiing Facilities (713920) industries primarily operate downhill, 
cross country, or related skiing areas, and provide food and beverage 
services, equipment rental, and ski instruction. The SBA size standard 
for this national industry is $31 million, which falls between two 
Economic Census revenue categories, $25 million and $100 million. The 
percentages of Skiing Facilities with revenue less than these amounts 
were 93 percent and 98 percent.\39\ Because the SBA threshold is

[[Page 40158]]

closer to the lower of these two boundaries, FMCSA has assumed that the 
percent of these facilities that are small will be closer to 93 percent 
and is using that figure.
---------------------------------------------------------------------------

    \39\ The Agency presents a high-end estimate of 98 percent which 
includes assumptions about limitations in Economic Census data. Some 
revenue data for firms that would be considered small (revenue 
categories of $100,000 or more and $250,000 to $499,999) are 
suppressed by the Economic Census. Because the Agency is unable to 
ascertain the revenue for the suppressed firms, the high-end 
estimate assumes that such firms may fall under the $31 million SBA 
threshold. The low-end estimate assumes the suppressed firms are not 
small.
---------------------------------------------------------------------------

    The Agency estimates that the majority of entities affected by this 
NPRM would fall under the All Other Amusement Recreation Industries 
national industry (713990). This includes whitewater rafting, hunting, 
horseback riding stables, boating clubs, canoeing, archery and shooting 
ranges, hiking, and others. The SBA size standard for this national 
industry is $8 million. The $8 million SBA threshold falls between two 
Economic Census revenue categories, $5 million and $10 million. The 
percentages of these providers with revenue less than these amounts 
were 60 percent and 99.6 percent. The Agency estimates a wide range in 
estimates due to limitations in Economic Census data for this NAICS 
category. Specifically, of the 12,688 firms in this industry, 12,631 
have revenue between $100,000 and $10 million. However, data on small 
entities with revenue under $250,000 are suppressed. There are 7,490 
small entities (59 percent) with revenue between $250,000 and $5 
million, and 139 firms with revenue between $5 million and $10 million 
(1.1 percent). Of the 12,688 firms in All Other Amusement Recreation 
Industries, there are firms 5,002 without revenue data (39.4 percent). 
The high-end estimate assumes all such firms are small (99.6 percent) 
and FMCSA is using that figure.
    Table 7 below shows the complete estimates of the number of small 
entities within the national industries that may be affected by this 
rulemaking.

                                 Table 7--Estimates of Numbers of Small Entities
----------------------------------------------------------------------------------------------------------------
                                                                   Total number      Number of    Percent of all
            NAICS code                      Description              of firms     small entities     firms (%)
----------------------------------------------------------------------------------------------------------------
487110...........................  Scenic and Sightseeing                    520             512              98
                                    Transportation, Land.
487210...........................  Scenic and Sightseeing                  1,129           1,097              97
                                    Transportation, Water.
487990...........................  Scenic and Sightseeing                    169             165              98
                                    Transportation, Other.
561520...........................  Tour Operators...............           2,175           1,991              92
711212...........................  Racetracks...................             299             248              83
711219...........................  Other Spectator Sports.......           1,916           1,577              82
713910...........................  Golf Courses and Country                8,076           7,712              95
                                    Clubs.
713920...........................  Skiing Facilities............             203             189              93
713990...........................  All Other Amusement                    12,688           7,629              60
                                    Recreation Industries.
----------------------------------------------------------------------------------------------------------------

4. A Description of the Proposed Reporting, Recordkeeping and Other 
Compliance Requirements of the Proposed Rule, Including an Estimate of 
the Classes of Small Entities Which Will be Subject to the Requirement 
and the Type of Professional Skills Necessary for Preparation of the 
Report or Record
    This proposed rule would not result in new recordkeeping 
requirements.
5. An Identification, to the Extent Practicable, of All Relevant 
Federal Rules That May Duplicate, Overlap, or Conflict With the 
Proposed Rule
    FMCSA is not aware of any relevant Federal rules that may 
duplicate, overlap, or conflict with the proposed rule.
6. A Description of Any Significant Alternatives to the Proposed Rule 
Which Accomplish the Stated Objectives of Applicable Statutes and Which 
Minimize Any Significant Economic Impact of the Proposed Rule on Small 
Entities
    Given that the recreational activities exemption was statutorily 
mandated, FMCSA did not have an alternative or discretion as to whether 
to adopt the exemption but did consider whether to propose a definition 
of the term recreational activities or to remain silent. FMCSA also 
considered the alternative of adding a definition without including 
specific examples. However, FMCSA believes that remaining silent or 
proposing a definition without specific examples could result in 
confusion or inconsistent enforcement and that it was better to propose 
a definition with examples consistent with the legislative intent to 
minimize any significant economic impact on small entities.
7. Description of Steps Taken by a Covered Agency To Minimize Costs of 
Credit for Small Entities
    FMCSA is not a covered agency as defined in section 609(d)(2) of 
the Regulatory Flexibility Act and has taken no steps to minimize the 
additional cost of credit for small entities.
8. Requests for Comment To Assist Regulatory Flexibility Analysis
    FMCSA requests comments on all aspects of this initial regulatory 
flexibility analysis.

E. Assistance for Small Entities

    In accordance with section 213(a) of the Small Business Regulatory 
Enforcement Fairness Act of 1996 (Pub. L. 104-121, 110 Stat. 857), 
FMCSA wants to assist small entities in understanding this proposed 
rule so they can better evaluate its effects on themselves and 
participate in the rulemaking initiative. If the proposed rule would 
affect your small business, organization, or governmental jurisdiction 
and you have questions concerning its provisions or options for 
compliance, please consult the person listed under FOR FURTHER 
INFORMATION CONTACT.
    Small businesses may send comments on the actions of Federal 
employees who enforce or otherwise determine compliance with Federal 
regulations to the Small Business Administration's Small Business and 
Agriculture Regulatory Enforcement Ombudsman (Office of the National 
Ombudsman, see https://www.sba.gov/about-sba/oversight-advocacy/office-national-ombudsman) and the Regional Small Business Regulatory Fairness 
Boards. The Ombudsman evaluates these actions annually and rates each 
agency's responsiveness to small business. If you wish to comment on 
actions by employees of FMCSA, call 1-888-REG-FAIR (1-888-734-3247). 
DOT has a policy regarding the rights of small entities to regulatory 
enforcement

[[Page 40159]]

fairness and an explicit policy against retaliation for exercising 
these rights.

F. Unfunded Mandates Reform Act of 1995

    The Unfunded Mandates Reform Act of 1995 (2 U.S.C. 1531-1538) 
(UMRA) requires Federal agencies to assess the effects of their 
discretionary regulatory actions. The Act addresses actions that may 
result in the expenditure by a State, local, or Tribal government, in 
the aggregate, or by the private sector of $178 million (which is the 
value equivalent of $100 million in 1995, adjusted for inflation to 
2021 levels) or more in any 1 year. Though this NPRM would not result 
in such an expenditure, and the analytical requirements of UMRA do not 
apply as a result, the Agency discusses the effects of this proposed 
rule elsewhere in this preamble.

G. Paperwork Reduction Act

    This proposed rule contains no new information collection 
requirements under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-
3520).

H. E.O. 13132 (Federalism)

    A rule has implications for federalism under section 1(a) of E.O. 
13132 if it has ``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.'' FMCSA has determined that this proposed rule would not 
have substantial direct costs on or for States, nor would it limit the 
policymaking discretion of States. Nothing in this document preempts 
any State law or regulation. Therefore, this proposed rule does not 
have sufficient federalism implications to warrant the preparation of a 
Federalism Impact Statement.

I. Privacy

    The Consolidated Appropriations Act, 2005,\40\ requires the Agency 
to assess the privacy impact of a regulation that will affect the 
privacy of individuals. This NPRM would not require the collection of 
personally identifiable information.
---------------------------------------------------------------------------

    \40\ Public Law 108-447, 118 Stat. 2809, 3268, note following 5 
U.S.C. 552a (Dec. 4, 2014).
---------------------------------------------------------------------------

    The Privacy Act (5 U.S.C. 552a) applies only to Federal agencies 
and any non-Federal agency that receives records contained in a system 
of records from a Federal agency for use in a matching program.
    The E-Government Act of 2002,\41\ requires Federal agencies to 
conduct a Privacy Impact Assessment (PIA) for new or substantially 
changed technology that collects, maintains, or disseminates 
information in an identifiable form. No new or substantially changed 
technology would collect, maintain, or disseminate information as a 
result of this rulemaking. Accordingly, FMCSA has not conducted a PIA.
---------------------------------------------------------------------------

    \41\ Public Law 107-347, sec. 208, 116 Stat. 2899, 2921 (Dec. 
17, 2002).
---------------------------------------------------------------------------

    In addition, the Agency submitted a Privacy Threshold Assessment 
(PTA) to evaluate the risks and effects the proposed rulemaking might 
have on collecting, storing, and sharing personally identifiable 
information. The DOT Privacy Office has determined that this rulemaking 
does not create privacy risk.

J. E.O. 13175 (Indian Tribal Governments)

    This proposed rule does not have Tribal implications under E.O. 
13175, Consultation and Coordination with Indian Tribal Governments, 
because it does not have a substantial direct effect on one or more 
Indian Tribes, on the relationship between the Federal Government and 
Indian Tribes, or on the distribution of power and responsibilities 
between the Federal Government and Indian Tribes.

K. National Environmental Policy Act of 1969

    FMCSA analyzed this proposed rule pursuant to the National 
Environmental Policy Act of 1969 (NEPA) (42 U.S.C. 4321 et seq.) and 
determined this action is categorically excluded from further analysis 
and documentation in an environmental assessment or environmental 
impact statement under FMCSA Order 5610.1 (69 FR 9680), Appendix 2, 
(6)(b). The categorical exclusion (CE) in paragraph (6)(b) covers 
regulations which are editorial or procedural, such as, those updating 
addresses or establishing application procedures, and procedures for 
acting on petitions for waivers, exemptions and reconsiderations, 
including technical or other minor amendments to existing FMCSA 
regulations. The proposed requirements in this rule are covered by this 
CE, there are no extraordinary circumstances present, and the proposed 
action does not have the potential to significantly affect the quality 
of the environment.

List of Subjects in 49 CFR Part 372

    Agricultural commodities, Buses, Cooperatives, Freight forwarders, 
Motor carriers, Moving of household goods, Seafood.
    Accordingly, FMCSA proposes to amend 49 CFR part 372 as follows:

PART 372--EXEMPTIONS, COMMERCIAL ZONES, AND TERMINAL AREAS

0
1. The authority citation for part 372 continues to read as follows:

    Authority:  49 U.S.C. 13504 and 13506; Pub. L. 105-178, sec. 
4031, 112 Stat. 418; and 49 CFR 1.87.

0
2. Amend Sec.  372.107 by adding paragraph (i) to read as follows:


Sec.  372.107   Definitions.

* * * * *
    (i) Recreational activities. The term recreational activities means 
activities consisting of an outdoor experience or excursion typically 
of a physical or athletic nature which require transportation for the 
sole purpose of moving customers to another location or locations where 
the outdoor experience or excursion will take place and collecting 
those customers to transport them back to the place of initial boarding 
or another outpost of the motor carrier. Recreational activities 
include but are not limited to hiking, biking, horseback riding, 
canoeing, whitewater rafting, water trails, tubing, skiing, 
snowshoeing, snowmobiling, hunting, fishing, mountain climbing, and 
swimming. The term does not include any activity for which:
    (1) The activity offered or sold is occurring simultaneously with 
the transportation; or
    (2) For which the transportation is the primary service offered for 
sale.
0
3. Add Sec.  372.113 to read as follows:


Sec.  372.113  Providers of recreational activities.

    Transportation by a motor vehicle designed or used to transport not 
fewer than 9, and not more than 15, passengers (including the driver), 
whether operated alone or with a trailer attached for the transport of 
recreational equipment, is exempted from regulation promulgated 
pursuant to part B of title 49 U.S.C. subtitle IV if:
    (a) The motor vehicle is operated by a person that provides 
recreational activities;
    (b) The transportation is provided within a 150 air-mile radius of 
the location at which passengers initially boarded the motor vehicle at 
the outset of the trip; and

[[Page 40160]]

    (c) In the case of a motor vehicle transporting passengers over a 
route between a place in a State and a place in another State, the 
person operating the motor vehicle is lawfully providing transportation 
of passengers over the entire route in accordance with applicable State 
law.

    Issued under authority delegated in 49 CFR 1.87.
Robin Hutcheson,
Administrator.
[FR Doc. 2023-13081 Filed 6-20-23; 8:45 am]
BILLING CODE 4910-EX-P