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Thursday,

October 13, 2005

Part V

Department of
Transportation
Federal Aviation Administration

14 CFR Parts 21, 121, 135, 145, and 183


Establishment of Organization
Designation Authorization Program; Final
Rule

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59932 Federal Register / Vol. 70, No. 197 / Thursday, October 13, 2005 / Rules and Regulations

DEPARTMENT OF TRANSPORTATION Counsel, Regulations Division (AGC– Regulation, Section 44702—Issuance of


200), Federal Aviation Administration, Certificates. Under paragraph 44702(d),
Federal Aviation Administration 800 Independence Avenue, SW., the FAA Administrator may delegate to
Washington, DC 20591; telephone (202) a qualified private person a matter
14 CFR Parts 21, 121, 135, 145, and 183 267–3073; facsimile (202) 267–7971; e- related to issuing certificates, or related
[Docket No. FAA–2003–16685; Amendment mail karen.petronis@faa.gov. to the examination, testing, and
Nos. 21–86, 121–311, 135–97, 145–23, and SUPPLEMENTARY INFORMATION: inspection necessary to issue a
183–12] certificate he is authorized by statute to
Availability of Rulemaking Documents issue under § 44702(a). Under paragraph
RIN 2120–AH79 You can get an electronic copy using (d), the Administrator is empowered to
Establishment of Organization the Internet by: prescribe regulations and other
(1) Searching the Department of materials necessary for the supervision
Designation Authorization Program
Transportation’s electronic Docket of delegated persons. This regulation is
AGENCY: Federal Aviation Management System (DMS) Web page within the scope of that authority in that
Administration (FAA), DOT. (http://dms.dot.gov/search); it establishes a comprehensive program
ACTION: Final rule. (2) Visiting the FAA’s Regulations and for the designation of organizations in
Policies’ Web page at http:// 14 CFR part 183.
SUMMARY: This final rule establishes the www.faa.gov/regulationspolicies; or
Organization Designation Authorization (3) Accessing the Government Background
(ODA) program. The ODA program Printing Office’s Web page at http:// History of Designation Programs
expands the scope of approved tasks www.gpoaccess.gov/fr/index.html.
available to organizational designees; You can also get a copy by sending a Since at least 1927, the federal
increases the number of organizations request to the Federal Aviation government has used private persons to
eligible for organizational designee Administration, Office of Rulemaking, examine, test and inspect aircraft as part
authorizations; and establishes a more ARM–1, 800 Independence Avenue of the system for managing aviation
comprehensive, systems-based approach SW., Washington, DC 20591, or by safety. The current system of
to managing designated organizations. calling (202) 267–9680. Make sure to delegations has been evolving since the
This final rule also sets phaseout dates identify the amendment number or need for assistance by private persons
for the current organizational designee docket number of this rulemaking. was recognized over 70 years ago.
programs, the participants in which will Anyone can search the electronic Beginning in the 1940s, the FAA’s
be transitioned into the ODA program. form of comments received into our predecessor agency, the Civil
This program is needed as the dockets by the individual’s name who Aeronautics Administration (CAA)
framework for the FAA to standardize sends the comment (or signs the established programs to appoint
the operation and oversight of comment, if sent for an association, designees to perform certain tasks for
organizational designees. The effect of business, labor union, etc.). You may airman approvals, airworthiness
this program will be to increase the review DOT’s complete Privacy Act approvals and certification approvals.
efficiency with which the FAA appoints statement in the Federal Register These include the Designated
and oversees designee organizations, published on April 11, 2000 (Volume Engineering Representative (DER),
and allow the FAA to concentrate its 65, Number 70; Pages 19477–78) or you Designated Manufacturing Inspection
resources on the most safety-critical may visit http://dms.dot.gov. Representative (DMIR), and Designated
matters. Pilot Examiner (DPE) programs.
Small Business Regulatory Enforcement In the 1950s, the rapid expansion of
DATES: This amendment becomes Fairness Act the aircraft industry led to the adoption
effective November 14, 2005. Affected The Small Business Regulatory of the Delegation Option Authorization
parties, however, do not have to comply Enforcement Fairness Act (SBREFA) of (DOA) program to supplement the
with the information collection 1996 requires FAA to comply with agency’s limited resources for
requirements of §§ 183.43, 183.45, small entity requests for information or certification of small airplanes, engines
183.53, 183.55, 183.57, 183.63, or advice about compliance with statutes and propellers. As the first program that
183.65 until the control number and regulations within its jurisdiction. If delegated authority to an organization
assigned by the Office of Management you are a small entity and you have a rather than an individual, DOA was
and Budget (OMB) for this information question about this document, you may intended to take advantage of the
collection requirement is published in contact its local FAA official, or the experience and knowledge inherent in a
the Federal Register. Publication of the person listed under FOR FURTHER manufacturer’s organization. Currently,
control number notifies the public that INFORMATION CONTACT. You can find out DOAs are authorized for certification
OMB has approved this information more about SBREFA on the Internet at and airworthiness approvals for the
collection requirement under the http://www.faa.gov/avr/arm/sbrefa.cfm. products manufactured by the
Paperwork Reduction Act of 1995. authorization holder.
FOR FURTHER INFORMATION CONTACT: For Authority for This Rulemaking The Federal Aviation Act of 1958
technical issues, Ralph Meyer, The FAA’s authority to issue rules established the Federal Aviation Agency
Delegation and Airworthiness Programs about aviation safety is found in Title 49 and codified the authority of the
Branch, Aircraft Engineering Division of the United States Code. Subtitle I, Administrator to delegate certain
(AIR–140), Aircraft Certification Section 106 describes the authority of matters in section 314 of that Act. When
Service, Federal Aviation the FAA Administrator. Subtitle VII, that statute was recodified in the 1990s,
Administration, 6500 S. MacArthur Aviation Programs, describes in more the delegation authority was placed in
Blvd., ARB Room 308, Oklahoma City, detail the scope of the agency’s 49 U.S.C. 44702(d) without substantive
OK, 73169; telephone (405) 954–7072; authority. change to the authority of the
facsimile (405) 954–2209, e-mail This rulemaking is promulgated Administrator.
ralph.meyer@faa.gov. For legal issues, under the authority described in The 1960s saw the creation of the
Karen Petronis, Office of the Chief Subtitle VII, Part A, Chapter 447—Safety Designated Alteration Station (DAS)

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Federal Register / Vol. 70, No. 197 / Thursday, October 13, 2005 / Rules and Regulations 59933

Program, which was intended to reduce delegation. This is true even though available authorized functions will
delays in issuing supplemental type some parts of the delegation regulations reduce the time and cost for these
certificates (STCs) by allowing the in part 183 and elsewhere refer to kinds certification activities.
approved engineering staffs of repair of certificates that denote the authority While our current delegations are
stations to issue STCs. As adopted, the granted. limited to such organizations as
DAS program allows eligible air carriers, An ODA issued under this program is manufacturers, air carriers, commercial
commercial operators, domestic repair a delegation made under section operators, and repair stations, this rule
stations and product manufacturers to 44702(d), not a statutorily authorized formalizes the delegation of functions to
issue STCs and related airworthiness certificate issued under section any qualified organization. Accordingly,
certificates. 44702(a). The authority of the an organization with demonstrated
In the 1970s the FAA reviewed its Administrator to suspend, revoke, or competence, integrity, and expertise in
delegated organization programs, which withhold ODA authorization is not aircraft certification functions is eligible
then allowed the approval of major subject to appeal to the National to apply for an ODA.
alteration data by a delegated Transportation Safety Board. Creation of the ODA program aids the
organization, but not approval of major expansion of the designee system by
ODA Program Overview
repair data. This review lead to the addressing the delegation of more
adoption of Special Federal Aviation The FAA is adopting the ODA
functions related to aircraft certification,
Regulation (SFAR) 36 in 1978 to allow program as a means to provide more
and new functions pertaining to
eligible air carriers, commercial effective certification services to its
certification and authorization of
operators, and domestic repair stations customers. This final rule adopts the
airmen, operators, and air agencies. For
to develop and use major repair data regulatory basis of the ODA program.
general aviation operations, the rule
without FAA approval of the data. Companion FAA orders, similar to the
allows an ODA Unit member to issue
In the 1980s, the FAA established the draft Order made available for review,
airman certificates or authorizations
Designation Airworthiness will describe the specifics of the
under 14 CFR parts 61, 63, or 91.
Representative (DAR) program to program and provide guidance for FAA
Additionally, the rule allows designated
expand the airworthiness certification personnel and for organizations to
which we grant an ODA. These orders organizations to find compliance or
functions that individual designees may
will also provide information to FAA conduct functions leading to the
perform. At the same time, we allowed
personnel on how to qualify, appoint, issuance of certificates or authorizations
for organizations to serve as DARs, in a
and oversee organizations in the ODA for any statutorily authorized function,
program known as Organizational
program. including—
Designated Airworthiness
As aviation industry needs continue • Rotorcraft external load operations
Representatives (ODARs).
Since the formation of the first to expand at a rate exceeding that of under 14 CFR part 133;
organizational designee programs, FAA resources, the need for the ODA • Agricultural operations under 14
organizational designees have gained program has become more apparent. CFR part 137;
significant experience in aircraft According to a 1993 report by the • Air agencies operations under 14
certification matters, and the FAA has General Accounting Office (GAO/ CFR part 141; and
gained significant experience in RCED–93–155), the FAA’s certification • Training centers operators under 14
managing these designee programs. We work has increased five-fold over the CFR part 142 (air carrier functions
have found that the quality of the last 50 years. The ODA program is a excluded).
approvals processed by these consolidation and improvement of the Nothing in the establishment of the
organizations equals those processed by piecemeal organizational delegations ODA program changes any authority or
the FAA. Delegation of tasks to these that have developed on an ‘‘as needed’’ responsibility for compliance with the
organizations has allowed the FAA to basis over the last half century. As the certification, airworthiness or
focus our limited resources on more FAA’s dependence on designees has operational requirements currently in
critical areas. increased, so has the need to oversee place, such as part 21 or part 121. No
designated organizations using a single, current safety requirements are being
Status of Designees flexible set of procedures and a systems removed or relaxed. The ODA program
In understanding these programs, we approach to management. Using our does not introduce any type of self-
consider it essential to remember that experience with both individual and certification.
designees have a unique status. While organizational designees, we have An Organization Designation
we refer to these persons and designed the ODA program with these Authorization includes both an ODA
organizations informally as ‘‘designees’’, criteria in mind. Holder and an ODA Unit. The ODA
under part 183 they are referred to as The ODA program improves the Holder is the parent organization to
‘‘representatives of the Administrator.’’ FAA’s ability to respond to our steadily which the FAA grants an ODA Letter of
When acting as a representative of the increasing workload by expanding the Designation. The ODA Unit is an
Administrator, these persons or scope of authorized functions of FAA identifiable unit of two or more
organizations are required to perform in organizational designees, and by individuals within the ODA Holder’s
a manner consistent with the policies, expanding eligibility for organizational organization that performs the
guidelines, and directives of the designees. One way this program authorized functions. The regulations
Administrator. When performing a expands eligibility is by eliminating the specify separate requirements for the
delegated function, designees are legally requirement that an organization hold ODA Holder and the ODA Unit.
distinct from and act independent of the some type of FAA certificate before it Because the ODA program eliminates
organizations that employ them. The would qualify for designation the requirement that an applicant hold
authority of these representatives to act authorization. an FAA certificate, organizations
comes from an FAA delegation and not The ODA program also allows the consisting of consultant engineering and
a certificate. As provided by statute, the FAA to delegate any statutorily inspection personnel could be eligible
Administrator may at any time and for authorized functions to qualified for an ODA. Under such circumstances,
any reason, suspend or revoke a organizations. Expansion of the it is possible the ODA Holder would

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59934 Federal Register / Vol. 70, No. 197 / Thursday, October 13, 2005 / Rules and Regulations

have the same composition as the ODA FAA Offices that manage existing procedures. These organizations will
Unit. delegated organizations will oversee the have to submit an application and make
transition of those organizations using minimal changes to their procedures
ODA Program Policy
the following criteria: manuals in order to receive an ODA.
As noted earlier in this preamble, • A need to delegate the authorized The certification activity of existing
FAA orders will outline the specifics of functions. organizations will also be reviewed to
the ODA program and provide guidance • An organization’s level of determine whether it is still in the
for both FAA personnel and for certification activity. FAA’s interest to appoint the
organizations that obtain an ODA. These • The number and need for new ODA organization as an ODA. We expect that
orders will describe the authorized organizations. there will be greater impact to existing
functions for aircraft-related approvals, Priority will be given to existing ODAR organizations, which will have to
such as type certificates and delegated organizations that have and develop new procedures, such as
airworthiness certificates, and certain are expected to maintain a significant internal evaluations and in-house
operations-related approvals like airman workload in new areas authorized under training, which are not current ODAR
certificates. While the regulations the ODA regulations. For example, an requirements. Existing authorized
contain the general requirements of the existing DAS that desires to have both representatives for all types of delegated
ODA program, the orders will provide STC and Parts Manufacturer Approval organizations will be granted the same
(PMA) functions under an ODA would level of authority under the ODA
the administrative details. Providing the
be a higher transition priority than a
specifics in orders allows for flexibility program without additional review of
DAS that would not be adding any new
to expand or revise the details of the their qualifications.
functions. Similarly, the FAA may find
ODA program without further
it of greater benefit to appoint a new Impact on Individual Designee
rulemaking, especially since every type
ODA with a heavier workload than Programs
of delegated function that may be
transition of an existing organization
appropriate for an ODA Unit cannot be As noted in the NPRM, the FAA
with a lighter workload.
foreseen. Based on these considerations, each expects that a significant number of
In addition to approved delegated FAA field office will develop a strategy individual designees who work for
functions and the eligibility for managing the ODA applications it larger organizations will become
requirements for delegated functions, receives. We expect that existing members of an ODA Unit and give up
the orders address the specific selection, delegated organizations will cooperate their individual designee status. The
appointment, and oversight procedures with their managing offices in FAA may allow an ODA Unit staff
the FAA will follow in managing ODA submission of their ODA applications. member to remain a designee provided
Holders. Additional ODA program The FAA managing offices will, to the that there is a sufficient amount of
details may be described in other FAA extent possible, develop a transition designee work outside of his ODA
orders or policies. schedule that meets the organization’s activity to warrant continuation of the
needs. The FAA will not accept ODA designee authority. The FAA applies
Application for ODA and Transition of
applications until November 14, 2006 in this same philosophy to existing
Existing Delegation Holders
order to establish a smooth transition in designees that are staff members for
This rule provides that existing prioritizing and processing applications. DAS, DOA, or SFAR 36 organizations.
Designated Alteration Station (DAS), We are not able to predict how long it As commenters to the NPRM note, we
Delegation Option Authorization (DOA) will take the agency to act on an do not expect that the ODA program
and Special Federal Aviation Regulation individual application. Existing will significantly reduce the number of
36 (SFAR 36) authorization programs delegated organizations should apply consultant DERs, and the need for
will be phased out over three years for ODA as requested by their managing consultant DERs will remain dependent
beginning November 14, 2006. office, but not later than 18 months after on their level of activity.
Additionally, Organizational Designated the application period begins to ensure ODA Program Final Rule
Airworthiness Representatives (ODARs) that its application may be processed
will no longer be appointed under part and fully considered before the end of In addition to establishing the ODA
183 subpart A, and will have to apply the three-year phaseout period. program, this final rule also includes
for an ODA within the three-year The FAA will provide transition revisions that standardize the duration
phaseout period. The FAA’s priority training for existing DAS, DOA, and of certificates for aircraft certification
during the phaseout period will be the SFAR 36 administrators to address the and flight standards individual
transition of existing organizations to differences between ODA and existing designees; the designation of these
ODA. programs. This training is required for individuals continues under part 183,
The FAA intends to appoint new ODA these organizations’ administrators subparts B and C. This final rule creates
applicants based on the need for their before they may be appointed under a new subpart D in part 183 that
services. The ability of a particular FAA ODA. The FAA is planning similar contains the regulations applicable to all
field office to appoint new ODA Holders training for new ODA applicants that types of organizational designees. This
will depend on the number of existing will more comprehensively address all rule replaces existing DAS, DOA, SFAR
delegated organizations in an office’s aspects of the ODA program. Because of 36, and ODAR delegation programs with
jurisdiction. During the three-year the substantial differences between a single delegation program for
phaseout period of the current delegated ODA and ODAR requirements, ODAR organizations. The regulations
organization programs, the only new administrators will have to complete governing those other programs,
applicants (those with no existing this more comprehensive training prior subparts J and M of part 21, and SFAR
organizational delegation) the FAA to appointment as an ODA. 36, are being phased out under this rule
expects to appoint are those with a It is expected that DAS, DOA and by placing a suspension date of (Insert
significant history of certification work SFAR 36 organizations will be able to date 4 years after the effective date of
and whose workload could be better transition to an ODA program with this rule) for functions performed under
managed under an ODA. minimal changes to their existing those programs.

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Federal Register / Vol. 70, No. 197 / Thursday, October 13, 2005 / Rules and Regulations 59935

Disposition of Comments will allow the FAA to establish the oversight program are routine
The FAA received 40 comments to the additional delegation programs without evaluations of the delegated
NPRM from 36 commenters. Eleven of needing to amend the rule. organization’s performance by FAA
Several opposing commenters assert managing offices. This oversight feature
the 36 commenters, including the
that previous problems with designees is included in the ODA program.
General Aviation Manufacturers
or delegated organizations indicate that The FAA continues to seek input on
Association (GAMA), Gulfstream
delegation is not beneficial. They state improvements in oversight and
Aerospace Corporation (Gulfstream
general opposition to the idea of management procedures for all of its
Aerospace), the Aerospace Industries
delegation, or of expanding delegation designee programs. The Government
Association (AIA), and International
to make it available to more Accountability Office (GAO) completed
Aero Engines (IAE), express general
organizations, and they generally do not a review of the FAA designee system
support for the rule. Fourteen think it is the most efficient use of FAA (GAO 05–40, ‘‘FAA Needs to Strengthen
commenters oppose the rule in general, resources. Most commenters expressing the Management of its Designee
with three of them adding specific opposition did not provide comments to Programs’’) in October 2004. The FAA is
comments, addressed below. Comments any specific part of the proposed rule. taking steps to address the GAO’s
in opposition were received from More than one commenter states that recommended means of improving the
United Airlines, the Professional the FAA should be hiring more designee programs.
Airways Systems Specialists, and the inspectors, not spending its limited Additionally, the FAA is
National Air Traffic Controllers resources creating an organizational implementing an internal quality
Association. This discussion of designee system. Another common management system that will help
comments is organized by each objection is that the proposed rule seeks assess the performance of the delegation
proposed rule topic or section for which to increase the number of designees programs and implement any needed
we received comments. used by the FAA. corrective action.
Many of the general comments raise In proposing this program, the FAA is
issues with material in the agency order not spending money that could be Specific Comments
that specifies certain details of the ODA transferred to other unspecified Comment: Chromalloy Gas Turbine
program and application process. Most programs such as ‘hiring more Corporation opposes the rule because it
of those comments are considered inspectors’, as suggested by has not been coordinated with foreign
outside the scope of this rulemaking commenters. The proposed ODA aviation authorities. The commenter
since they do not address any part of the program is, at its simplest, a restatement notes that it worked with foreign
proposed rule language. A few of the of how we will be approving and authorities for years to gain acceptance
comments regarding material in the overseeing organizational designees. of FAA-approved data (from designated
draft order are addressed later in this The ODA program was not designed to engineering representatives (DERs)).
section, but most will be addressed in increase the overall number of Other commenters agree that it is
the final version of the Order. designees, but to increase the functions important that foreign airworthiness
Similarly, some comments make available to organizational designees. By authorities recognize approvals made by
suggestions beyond the scope of FAA doing so, the FAA hopes to reduce the a designee. One commenter states that
authority, such as an investigation of number of individual designees and the FAA should pursue bilateral
designee fees by the Internal Revenue concentrate its oversight resources more agreements to ensure mutual acceptance
Service. While we have reviewed all of effectively. of FAA ODA and European Aviation
the material submitted, comments such Many of the general opposing Safety Agency Design Organization
as these that transcend FAA authority comments note a few specific instances Approval (EASADOA) systems.
and the issues of the proposed rule will in which the designee programs have Response: Bilateral agreements are
not be addressed individually. experienced problems or been the negotiated with individual countries,
subject of investigation. While the FAA and an agreement may or may not
General Comments does not dispute that some designee provide for mutual acceptance of
Commenters that support the ODA programs have experienced problems, designee programs. The creation of ODA
rule state that it will result in more we believe that the commenters are should not change acceptance of
efficient and effective use of industry overstating their breadth because they designee approvals where they already
and FAA resources. They state that the are unfamiliar with the extent of the exist in a bilateral agreement. Nor does
ODA rule would lighten some of the designee programs already in use the ODA system prevent the use of DER
FAA workload and allow the FAA to compared to the number of problems approvals for organizations that prefer
better meet industry demand for reported. Today’s rule phases out the the DER system to support their
certification activities. General Electric assortment of delegated organization certification activity. The FAA expects
Aircraft Engines (GE Aircraft Engines), a programs we currently manage in favor that, at a minimum, foreign authorities
member of the Aviation Rulemaking of a single system, and both the FAA will be more accepting of ODA-
Advisory Committee (ARAC) that and the affected organizations will be approved repair data than they are of
developed recommendations for an operating under organizational data developed under SFAR 36 since
ODA rule, noted that it was particularly procedures that are familiar and SFAR 36 data is not considered ‘‘FAA-
satisfying to see that the FAA had left effective. This rule will make the approved.’’
intact the spirit of the recommendations benefits of organizational delegation Changing a domestic regulatory
developed by the ARAC. Other available to more types of organizations. program is not, however, a means to
commenters affirm that the ODA Further, the FAA is always seeking to presume acceptance of approved data
program will reduce the amount of FAA improve its designee programs, an under bilateral airworthiness
oversight needed for individual example of which is the August 2002 agreements. Coordination and
designees, while increasing the FAA’s implementation of new oversight acceptance of such issues is neither
capacity to issue approvals. processes that outline the participation simple nor accomplished quickly. The
Commenters also note that an expected of FAA offices involved in the oversight FAA has determined that it is better to
benefit is the increased flexibility that of delegated organizations. Included in put the ODA program in place for use

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59936 Federal Register / Vol. 70, No. 197 / Thursday, October 13, 2005 / Rules and Regulations

now and work out the more complex employees that they might employ, is The FAA anticipates that at some point
international acceptance issues over more efficient for both the FAA and experienced organizations may be able
time. industry and results in approvals that to select staff members without FAA
As noted, we expect no impact to comply with the regulations. The FAA review of the staff members’
existing agreements regarding approvals anticipates that these more effective qualifications and authority. However,
performed by an ODA Holder. However, delegation programs will increase safety the FAA will review the ODA Unit
we do not currently plan to allow by freeing up FAA resources for tasks member selection decisions made by
approvals issued by an EASADOA more critical to safety. Additionally, ODA Holders until they demonstrate
holder to be used within an ODA Congress has shown support for system- that they are capable of selecting
Holder’s system (or vice-versa) without based certification programs by qualified personnel for the ODA Unit.
authority-to-authority coordination and mandating the issuance of Design No change to the rule has been made
agreement. No change to the rule has Organization Certificates in the 2003 based on this comment.
been made based on this comment. reauthorization of the FAA. Design Comment: Several commenters,
Comment: One commenter does not organization certificates would give the including IAE and United Technologies
support the rule because it is too costly certificate holder privileges similar to Corporation (United Technologies),
to maintain and that the cost to the delegated organizations, but would have recommend an additional ODA program
public is ‘‘double taxation.’’ Another the authority of a certificate rather than type for airworthiness approvals. The
commenter notes that the public a delegation. No change to the rule has commenters state that the programs, as
deserves the safest and not the cheapest been made based on this comment. defined, could restrict the ability of
service. Comment: One commenter asserts existing ODARs to obtain an ODA
Response: Neither commenter was that while the quality of approvals by without obtaining additional
specific in its criticism of the costs of designees may be comparable for engineering functions.
the ODA program; most costs associated aircraft certification functions, it is not Response: We do not plan to have an
with the program will be borne by the true for designees such as examiners. ODA program specifically identified for
ODA Holder, and may be passed on to The commenter points out problems airworthiness approvals. Although this
its customers. No one is required to use with specific examiner programs, which specific program was not described in
the services of an ODA Holder; the FAA resulted in the re-examination of a the draft order, the proposed functions
will continue to do approvals directly if number of airmen. will continue to be available as a
requested. Nor is the goal of the ODA Response: The FAA acknowledges delegated function under the ODA
program to seek out the low bidder for that problems have been identified in program. The ODA program structure
services. The FAA will not make a some designee programs. However, the allows an existing ODAR to obtain an
decision to approve an ODA Holder FAA does not agree that this necessarily ODA without requiring the addition of
simply because the applicant claims it indicates that these approvals are not, as new functions or capabilities. No
can do the work cheaper. Those who a whole, comparable to those performed change to the rule has been made based
use the services of an ODA Holder may by the FAA. Additionally, the FAA has on this comment.
incur costs that would not occur if the taken steps to improve the oversight of Comment: IAE and United
FAA did the approval. A user may its individual and organizational Technologies Corporation recommend
nonetheless feel justified in incurring designees; the ODA program is expected that the FAA either set up an audit
the cost of the service from the ODA to result in further improvements. By program that does not require an ODA
Holder if, for example, the Holder can restructuring delegation programs Holder to report deficiencies that will
do it faster. The existence of ODA toward organizations, oversight of result in enforcement actions, or create
Holders is expected to free up more individuals is reduced, allowing the criteria for ‘‘safety-related’’ and ‘‘non-
FAA resources by allowing non-critical FAA workforce to focus on individual safety related’’ audit findings. Under
tasks to be accomplished by the designee oversight when needed. No such a proposal, the organization would
designee. None of the commenters gave change to the rule has been made based only have to report safety-related
any specific example of why the ODA on this comment. findings.
program would be more costly to the Comment: Many of the commenters, Response: Under the FAA’s
agency than any of the current designee including Piper Aircraft, AIA, and compliance and enforcement program,
programs, and we have no reason to Boeing Commercial Airplanes (Boeing) voluntarily disclosed violations may not
think it will be so. No change to the rule say FAA review of individual ODA Unit be subject to legal enforcement action.
has been made based on this comment. members contradicts the intent of a Requiring periodic audits by an
Comment: One commenter says the systems approach. They also note organization is consistent with similar
proposed ODA program significantly current delegation rules are not based requirements imposed on certificate
modifies the current regulatory on a systems approach because the FAA holders. The FAA expects ODA Holders
oversight system, deteriorating the must approve the individuals within the to take an active role in the
established technical FAA oversight by organization. identification and resolution of
going to a ‘‘systems’’ oversight approach Response: The FAA intends to allow deficiencies, including, non-
that would provide less specific and ODA Holders that have had significant compliances. No change to the rule has
technical FAA oversight and would, in experience as a delegated organization been made based on this comment.
time, reduce safety. to appoint ODA Unit members with a Comment: GAMA, IAE, and United
Response: The FAA disagrees that a minimum level of FAA involvement. Technologies, among others,
systems approach will provide less The process will require an ODA Holder recommend that the FAA provide the
specific technical oversight, and to notify the FAA of the names of public a chance to comment on whether
believes it will increase safety. A proposed staff members before the ODA a specific function should be delegated,
systems approach is currently being Holder conducts a full internal and state that changes to the ODA
used successfully to manage DAS and evaluation. If the FAA has reason to program should be noted in the Federal
DOA organizations. The FAA has found object to the appointment of an Register. One commenter suggests that
that management of these organizations, individual, we will do so before the the public also be invited to comment
rather than a number of individual organization does its full evaluation. on each applicant’s qualifications.

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Response: The FAA agrees that the certificates of authorization currently point. They propose that ODA should
public should be notified and given issued by the FAA. The USPA does not also allow a single focal point.
opportunity to provide input on believe this delegation is appropriate. Response: The commenters
proposed ODA programs. The FAA Response: The FAA agrees that a misunderstood the proposed rule.
plans to continue its practice of delegation of the approvals could Proposed § 183.41(b)(1) defines the
publishing notice of proposed policies negatively impact the long-standing authorized representatives within the
that implement new or changed safety record of parachute operations by ODA Unit. While there must be at least
programs such as ODA. introducing less-experienced third two authorized individuals within an
The FAA does not agree that it is parties into the process. Accordingly, ODA Holder’s organization, only one
appropriate to publish the names of the FAA has determined that ODA administrator is required. No
applicants and request public comment authorizations or waivers related to change to the rule has been made based
on their qualifications. We do not have parachute operations will not be on this comment. Section 183.41 has
such a process for other designee delegated at this time. Based on this been reformatted, and the definition of
programs, and decisions are based on comment, we have changed the rule ‘‘ODA Unit’’ in paragraph (b) has been
the FAA’s expertise and experience language to remove all references to part clarified.
working with individual organizations. 105 or parachute operations. Section 183.47 Eligibility (Now Titled
Public comment raises issues of bias
Comments on Specific Proposed Rule Qualifications)
against individuals and organizations
and we would have to determine Language Comment: Many commenters,
whether the person providing the Section titles are those from the including GE Aircraft Engines,
comment was qualified to assess the proposed rule, and may differ from Gulfstream Aerospace, and Raytheon
applicant. The FAA is comfortable with those in the final rule. Aircraft Company (Raytheon Aircraft)
its experience regarding determinations recommend that the FAA permit foreign
of an applicant’s qualifications. No Section 183.1 Scope organizations located in foreign
change to the rule has been made based Comment: Several commenters countries to obtain ODAs. They note
on this comment. request clarification of the term ‘‘private that the FAA could use its ‘‘no undue
Comment: IAE and United organization’’ as used in § 183.1(b), burden’’ concept to determine eligibility
Technologies note that it would be a since the introductory text of that for foreign organizations, and that such
burden to industry if DMIRs and ODA section uses the term ‘‘private persons.’’ organizations would help enhance the
Holders can’t perform functions on the One commenter suggests including a relationship between the United States
same project. They reference language definition of ‘‘private organization’’ in and foreign countries.
in the NPRM preamble, which states the introductory text of § 183.1 or in Response: The FAA agrees in part.
that organizations that currently have § 183.41 (Applicability and definitions). Although DERs currently must be
individual designees could operate Response: As defined in 14 CFR part located within the United States, the
under both systems (but not on the same 1, ‘‘person’’ includes both an individual FAA has appointed a limited number of
project or program). and an organization. Section 183.1 seeks airworthiness and manufacturing
Response: The FAA acknowledges to distinguish an individual from an designees that are located in foreign
that the NPRM language may have been organization for purposes of designation countries. We agree that the regulatory
confusing. The referenced language under part 183. Both individuals and language should not prevent foreign
specifically applies to design approval organizations may receive a designation, eligibility, and we have removed the
projects, such as Type Certificate (TC) but the ODA rule only applies to phrase, ‘‘located within the United
programs, issuing STCs, and developing organizations. No change to the rule has States’’, from proposed § 183.47(a)(1).
PMA design approvals. For these types been made based on this comment. The regulations for the individual
of projects, it is expected that all designee programs do not restrict
engineering and inspection functions Section 183.15 Duration of Certificates eligibility to persons in the United
related to the project would be Comment: Two commenters, States. The limitations for each designee
performed under the ODA authority, including IAE and United Technologies, type are included in the policies for
rather than another designee program. ask if the duration and renewal of managing these programs. Similarly, the
ODA Holders with DMIRs could certificates as proposed under this FAA might place a limitation on
continue to use both ODA and DMIR section are applicable to individual appointing ODA Holders in foreign
approvals on FAA-managed projects. ODA Unit members. countries in the associated FAA policy.
All authorities and capabilities available Response: The language in § 183.15 The rule has been changed as noted to
in the ODAR system are available under only applies to individual designees reflect this comment.
the ODA program. The FAA anticipates under other programs, not to the Comment: Texas Air Composites
that the need for separate DMIRs will individuals within the ODA Unit. ODA states that the FAA should revise
decrease, since all delegated inspection Unit members are not considered § 183.47(a) to state that the applicant
and production functions are available appointed by the FAA and their has ‘‘personnel with sufficient
under the ODA program. No change to appointment is not subject to renewal experience’’, rather than the
the rule has been made based on this by the FAA. However, the ODA Holder organization. Otherwise, it could be
comment. will have to periodically assess the misconstrued that the organization must
Comment: The United States individuals within their ODA Unit. No have the experience. This could result
Parachute Association (USPA) change to the rule has been made based in start-up or recently formed
comments that parachute operations on this comment. companies with qualified personnel not
functions are not mentioned in the draft being granted an ODA because the
ODA order, but are provided for in the Section 183.41 Applicability and organization is new.
proposed rule language. The USPA fears Definitions Response: The experience
that if the authority to issue parachute Comment: IAE and United requirement is meant to apply to the
operations approvals is delegated, it Technologies state that the current organization. Although an organization
could be held liable for issuing ODAR program only requires one focal may have experienced individuals, that

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group of individuals must have sought, and the title of the section language indicates that the FAA is not
experience working with each other and changed to Qualifications. The proposed considering delegation of PMAs. The
with the FAA as an organization. This language identified many different commenter states that design approvals
is the only way for the FAA to certificate holders as eligible for ODA, for PMAs should be a part of the ODA
determine that they are qualified, and but did not specify the authority program.
whether there is a need for the available for each type of certificate Response: The FAA agrees that an
authorization. Recently formed holder. ODA Holder may issue PMA
companies would not be eligible until Holding a certificate is not an supplements. However, the FAA has
they gain the necessary experience and eligibility requirement for ODA. never delegated the issuance of an
demonstrate that, historically, they have However, most functions authorized original PMA, and we do not intend to
sufficient workload to justify the under the ODA program require the do so under ODA. No change to the rule
authorization. No change to the rule has applicant to have been issued and hold has been made based on this comment.
been made based on this comment. a certificate related to the function. The Comment: One commenter states that
Comment: IAE and United only aircraft certification functions proposed § 183.49(c)(1) and (c)(3)
Technologies state that the FAA must currently anticipated for non-certificate appear to duplicate the provisions of
identify the criteria the agency will use holders are the approval of major § 183.29. The commenter believes that
to determine when a qualified alteration and major repair data. Our allowing DERs and ODA Unit members
organization will not be granted an draft order states that functions such as to perform the same functions would
ODA. Texas Air Composites further issuing STCs or PMA supplements double the FAA’s oversight workload.
notes that not granting an ODA to a require the applicant to have previously Response: The FAA disagrees. The
qualified applicant could result in a obtained such certificates from the FAA. commenter presumes that a DER and
financial disadvantage. The language in § 183.47 has been ODA Unit member would be performing
Response: A fundamental principle of revised to require only experience the same function. Although these
delegation is the FAA’s discretion in performing the desired function and proposed sections provide for functions
appointing designees and delegated experience with related FAA procedures similar to those performed by a DER, the
organizations. Even if qualified, an and policies. The list of certificates has performance of a function under an
organization is not entitled to an been removed from the rule language. ODA is separate and distinct from a
authorization, and the FAA does not The specific eligibility requirements for function performed by an individual
make delegation decisions based solely the available programs and functions are designee. As such, oversight of ODA
on an applicant’s desire to have an described in the associated FAA policy. functions is separate from any
authorization. Authorizations will be Comment: Several commenters, individual designee oversight. No
based on the need for the functions including IAE, United Technologies, change to the rule has been made based
requested. Thus, we expect to give Matsushita Avionics System on this comment.
priority to organizations with Corporation and Gulfstream Aerospace Comment: One commenter
demonstrated expertise and a large recommend that the FAA make holders recommends that the rule should have
workload. In some cases, we expect it of PMAs that were granted by license a subparagraph to denote inherently
may be beneficial for the FAA to eligible for an ODA. They state that governmental functions that may not be
manage an organization’s activity using PMA holders seeking production delegated.
individual designees. It is not possible approval functions should not be Response: Listing inherently
to state all the reasons that the FAA required to have experience in both governmental functions is not consistent
might have to deny an application. The design and production approval to with accepted regulatory drafting, or
primary considerations will always be obtain an ODA. This would be an with the intent of this rule. The FAA’s
the need for the authorization and the additional requirement from the ODAR delegation regulations define only those
ability of the FAA to oversee the system. The commenters recommend functions that may be accomplished by
organization’s activity. No change to the proposed § 183.47(c) be reworded as designees. We have revised proposed
rule has been made based on this follows: ‘‘An applicant seeking function § 183.49 by removing any reference to
comment. in the area of production must have for specific functions. The ODA rule allows
Comment: Regarding proposed the product, components, parts, or the delegation of any function allowed
§ 183.47(b)(1), IAE and United appliances for which the applicant is by 49 U.S.C. 44702(d). No change to the
Technologies state the FAA should seeking designation authorization, a rule has been made based on this
include Production Certificate and current PC, TSOA or PMA issued under comment.
Technical Standard Order Authorization Part 21 of this chapter.’’ Comment: AIA and Boeing note that
to the list of certificates used to Response: The FAA agrees. A PMA the proposal does not indicate whether
establish eligibility. Also, regarding holder may apply for an ODA to the ODA program will apply to part 34
proposed § 183.47(d), a commenter perform production and airworthiness (emissions) or part 36 (aircraft noise)
believes the proposed regulatory functions even if it does not have any standards. The commenters state that
language could be interpreted to deny engineering design experience. As noted delegation in these areas would be a
an ODA to a company that holds a type above, the qualification requirement has significant opportunity to gain
certificate that was transferred into the been revised to require only experience efficiency in the certification process
company. The commenter suggests the performing the desired function and with no associated safety risk. They
FAA revise the language to clarify that experience with related FAA procedures request that the rule state that parts 34
those companies holding a transferred and policies. The details of the specific and 36 are included.
type certificate are eligible for an ODA. eligibility requirements for the available Response: The FAA does not agree
Response: The FAA agrees that the programs and functions will be more that the rule should specifically note
proposed language of this section could fully described in the associated policy. application to parts 34 and 36. As
be misinterpreted. Section 183.47 has revised, the rule allows designees to
been significantly modified to clarify Section 183.49 Authorized Functions make findings of compliance with any
that eligibility is based solely on Comment: Electronic Cable FAA requirements. The FAA anticipates
experience performing the functions Specialists comments that the preamble that ODA Holders may perform noise

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and emission-related functions to the specific in explaining what these terms procedures manual. The commenters
extent currently performed by DERs, but mean. fear that stating the content as a
does not expect an expansion of the Response: The FAA disagrees. minimum requirement will discourage
authorized functions under the ODA Specifying what qualified and the adoption of industry practices that
program. No change to the rule has been experienced means in the many possible exceed the requirements in the
made based on this comment. types of administrators and personnel regulation. They note that the details of
that might be needed in an ODA procedures manuals are usually in
Section 183.51 ODA Unit Personnel organization is inappropriate for Orders and advisory circulars.
(Proposed § 183.51 Personnel) regulatory standards. The language is Response: The FAA has determined
Comment: Piper Aircraft recommends consistent with other designee rules that it is appropriate to specify
a provision in the rule or FAA policy currently used by the FAA, and procedures manual requirements in the
requiring that ODA Unit members delegation remains at the discretion of regulation. Since this section of the rule
receive training similar to that of FAA the FAA. More detail regarding defines only the required content of the
personnel. qualifications for ODA positions can be manual, rather than how to perform
Response: The FAA disagrees that found in the associated FAA orders. No authorized functions, ODA Holders will
ODA Unit members need the same change to the rule has been made based still be free to introduce good practices
training as FAA personnel. Training on this comment. that satisfy the requirements. No change
requirements may not be appropriate for to the rule has been made based on this
all types of ODA Unit members that may Section 183.53 Procedures Manual
comment.
exist under an ODA program. For Comment: IAE and United
example, engineers may perform limited Technologies state that the continued Section 183.55 Limitations
functions of a repetitive nature, such as airworthiness requirements in proposed Comment: IAE and United
burn test approvals, for which there is § 183.53(n) (revised as § 183.53(b)(13)) Technologies Corporation suggest
no associated FAA training. When should be applicable only to changing § 183.55(b) to add the term
appropriate, the training requirements engineering functions, and not to ‘‘significant,’’ since minor changes
for ODA Unit members will be defined production approval holders. within an ODA Unit may not affect the
in the FAA policy, but they are not Response: The FAA disagrees. The Unit’s qualifications.
appropriate to include in the rule procedures manual requirement applies Response: The FAA disagrees. The
language. No change to the rule has to ODA Holders performing either addition of the term ‘‘significant’’ would
been made based on this comment. engineering design or manufacturing- have no impact on the requirements of
Comment: One commenter states that related approvals. Manufacturing issues this paragraph. If changes within the
the rule should specify that ODA staff not specifically related to the ODA Unit or ODA Holder do not affect
members and ODA Unit Members must engineering or type design functions the qualifications of the ODA Unit or
be United States citizens, must be may lead to service difficulties and Holder, or the ability of the ODA Unit
subjected to the same background check require investigation by an ODA holder. to perform authorized functions, then
as FAA employees, and must live in the While no change to the rule has been they do not have to be reported. No
United States. made based on this comment, the change to the rule has been made based
Response: The FAA disagrees. Neither proposed requirement is now contained on this comment.
United States citizenship nor a federal in § 183.53(c)(13) referencing continued
Section 183.57 Responsibilities of an
employee background check are responsibilities.
Comment: IAE and United ODA Holder
qualifications currently imposed on
individual designees. Further, staff Technologies recommend rewording the Comment: Raytheon Aircraft and
members of delegated organizations are last sentence of the introductory text of GAMA comment on the language of
not required to be United States § 183.53 regarding changes to the proposed § 183.57(c), which specifies
citizens, nor are they subject to procedures manual, stating that there that the ODA Holder must ‘‘Ensure that
background checks by the FAA. The may be instances when the FAA will no interference or conflicting restraints
FAA expects that some ODA Holders authorize an ODA Holder to implement are placed on the ODA Unit or on the
will have staff members in foreign minor changes to the manual without personnel performing the designated
countries performing functions for FAA approval. They suggest revising the functions while complying with this
them. The associated FAA orders will sentence to state ‘‘Changes may be part and the approved procedures
include any limitations regarding staff implemented prior to FAA approval in manual.’’ They state that the proposed
members in foreign countries. No accordance with the change procedure language is not consistent with existing
change to the rule has been made based in the manual.’’ wording used in FAA Order 8100.9,
on this comment. Response: The FAA agrees that paragraph 3–3(a). The commenters
Comment: IAE and United certain minor changes to the manual question why this section is different
Technologies state that the experience may be made without prior approval. from the language of the existing order.
for determining conformity and issuing However, the procedures manual must Since the intent is the same, one
airworthiness approvals should be in specify the types of changes that may be commenter recommends that the FAA
inspection, not aircraft certification. adopted without FAA approval. adopt wording similar to that in Order
Response: The FAA agrees that Proposed § 183.53 has been revised and 8100.9. That Order states ‘‘The
inspection and related experience is its paragraphs redesignated. Section authorization holder must ensure that
appropriate for conformity and 183.53(b) allows certain changes to be the administrator and ARs [Authorized
airworthiness approvals. Accordingly, made to the manual, and to require that Representatives] remain free of any
we have removed the phrase ‘‘in aircraft the manual describe the types of restraints that would limit the DOA’s,
certification’’ from § 183.51(b). changes that may be incorporated DAS’s, or SFAR 36’s ability to ensure
Comment: One commenter notes that without specific FAA approval. that authorized functions are performed
the terms ‘‘qualified’’ and Comment: IAE and United in compliance with FAA regulations.’’
‘‘experienced’’ are subject to many Technologies state that the regulation is Response: The FAA agrees that the
interpretations. The rule should be more too detailed regarding the content of the intent of the proposed language is

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similar to that stated in Order 8100.9. Comment: Two commenters but no change to the rule has been made
However, we have determined that the recommend retaining the periodic audit based on this comment.
language used in the rule is preferable and records of corrective action required
Section 183.65 Data Review and
for the purpose of regulation since it under proposed § 183.63(b)(9) for two
Service Experience (Now § 183.63
also prohibits interference with the years rather than indefinitely.
Response: The FAA agrees that these Continuing Requirements: Products,
ODA Unit by the ODA Holder. No
records need not be retained Parts or Appliances)
change to the rule has been made based
on this comment. indefinitely. However, we consider Comment: AIA states that proposed
periodic audit records an important § 183.65(b) would require an ODA Unit
Section 183.63 Records and Reports means to document an organization’s to submit information necessary for the
(Proposed § 183.61) continued compliance with the FAA to implement corrective action.
Comment: Two commenters state that requirements for the authorization. Two The ODA Unit is the interface between
the requirement to submit data in the years may not be adequate in all cases, the ODA Holder and the FAA. A
proposed § 183.63(b)(3) should not since the planned oversight evaluation certificate holder’s obligation to develop
apply to airworthiness certificates, interval of two years could result in the and submit information under § 21.99
export approvals, the production development and destruction of these and § 21.277(b) remains in effect.
limitation records or ‘‘any other records before review of the corrective Several commenters note that the
approval authorized under this action by the FAA. To ensure adequate responsibility to investigate safety
subpart.’’ One commenter points out documentation for oversight of the ODA concerns should be directed toward the
that production limitation record Holder, § 183.61(b) requires these ODA Holder, not the ODA Unit.
requirements are already addressed in records be maintained for five years. Response: The FAA agrees that
the proposed § 183.63(b)(2), and that the Comment: IAE and United § 21.99 applies, but only to certificate
retention requirements for airworthiness Technologies state that the two year holders. Further, § 21.277(b) applies
certificates and approvals should be record retention requirements in only to Delegation Option Authorization
consistent with record retention proposed § 183.63(c)(1) should not be holders, which are being phased out as
requirements imposed on other applied to a production approval holder part of this rulemaking. The language of
designees. The commenters recommend (PAH) that holds an ODA since it is not proposed § 183.65(b) was intended to
deletion of proposed § 183.63(b)(6) for required for an FAA inspector or impose similar requirements on ODA
the same reasons. The same commenters designee. They add that part 21 already Holders. We note that while the
recommend conformity inspection specifies the inspection data proposed rule would have imposed the
records and airworthiness approvals be requirement for PAHs. information submission requirement on
maintained for two years rather than Response: The FAA agrees. While the ODA Unit, we agree that
indefinitely as proposed. such requirements are not imposed on investigation of service problems is a
Response: The FAA agrees in part. individual designees, the requirement is responsibility of the ODA Holder. An
Airworthiness certificates or approvals contained in the existing DOA rules. ODA Unit would be involved only in
are generally maintained for two years While necessary under the DOA rule, determining whether any proposed
by most types of designees. The final the FAA agrees that it is not necessary solution or design change is in
rule adopts a two-year requirement for under the ODA program since the other compliance with the regulations.
those ODA Holders that only issue these production approval holder Accordingly, the language in § 183.63
types of certificates or approvals. requirements in part 21 apply. The has been revised to indicate that it
However, ODA Holders that perform requirement proposed in § 183.63(c)(1) applies to the ODA Holder rather than
type design approvals, such as TC and has been removed. the ODA Unit. We also note that in
STC programs, are required to maintain Comment: IAE and United those cases where the ODA Holder is
records typically submitted to and Technologies state that the requirement not the certificate holder, this section
maintained by the FAA as part of of proposed § 183.63(b)(4) for an ODA requires the ODA Holder to conduct
standard certification projects. The Holder to maintain a list of products on investigation into potentially unsafe
airworthiness certificates or approvals which it has performed an authorized conditions or non-compliant conditions
associated with such design approval function should apply only to for those certificates they issued to
projects must be maintained ‘‘authorized engineering functions.’’ The another holder. Unlike § 21.99, this
indefinitely. As revised, § 183.61(a)(2) commenter points out that records section introduces the requirement for
requires indefinite retention of retention for manufacturing functions investigating non-compliant conditions,
airworthiness certificates or approvals should be the same as for other while § 21.99 applies only to unsafe
performed as part of type design designees. conditions. The rule has been revised as
programs, and revised § 183.61(c) Response: The FAA disagrees that the noted above as a result of this comment.
requires retention of other airworthiness list requirement should apply only to Comment: AIA states that § 183.65(a)
approvals or certificates for two years. engineering functions. The purpose of requires that investigations into
The FAA agrees that reference to this requirement is to maintain a list of potentially unsafe conditions must take
production limitation record data in the the specific products for which the ODA priority over all other delegated
proposed section § 183.63(b)(3) holder issues approvals. For example, a activities. The commenter is concerned
duplicated the requirement for the manufacturer authorized to issue that this text may be misinterpreted or
production certificate in the proposed airworthiness certificates is required to misapplied in practice. The commenter
§ 183.63(b)(2). The requirement for maintain a list of the aircraft for which states that organizations may have the
production related records has also been it issued airworthiness certificates, and capability to perform parallel activities
incorporated in revised 183.61(a)(2). a repair station authorized to approve on different projects, and does not want
The retention requirement of proposed alteration data is required to maintain a the requirement misapplied to affect
§ 183.63(b)(6) is also incorporated in the list of the aircraft for which it has ongoing projects. The commenter would
revised 183.61(a)(2) as a general approved alteration data. We have like the preamble of the final rule to
requirement for all approvals, rather removed the proposed language clarify the priority clause and the two
than a stand-alone requirement. specifying the means of identification, purposes it says the clause serves.

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Response: The FAA agrees that the the FAA’s workload. They also note that initial cost of $13,480 for a large
text regarding priority of investigation the rule does not specify the maximum organization and $7,980 for a small
into unsafe conditions may be duration of the ODA or how the FAA organization and an annual cost of
misinterpreted, and that the language in will determine individual expiration $13,450 for a large organization and
the proposed rule is not appropriate. dates. $6,850 for a small organization) were
The investigation into unsafe conditions Response: The FAA disagrees; all reasonable.
is an activity that is inherent upon the FAA individual designee programs have Response: We agree and use those
ODA Holder and not something the expiration dates. The FAA determines same unit cost values in the Final
FAA delegates. We agree that it might be expiration dates based on the Regulatory Evaluation.
feasible for an ODA holder to experience and history of the Comment: In the Initial Regulatory
adequately perform an investigation organization and the functions they Evaluation, we estimated that the initial
while certification activity continues. perform. Renewal of the authorization cost to obtain an ODA would be $7,320
Since the FAA will continue to manage allows the FAA to periodically assess an for a large ODAR and $5,780 for a small
the ODA Holder’s delegated activity, the organization’s performance and ODAR. The IAE comments that its large
FAA will determine whether an ODA determine whether the workload of the manufacturing ODAR initial cost would
Holder is placing sufficient emphasis on organization justifies continuing the be $7,260. Pratt and Whitney
the investigation of service problems. authorization. No change to the rule has commented that its large manufacturing
We could restrict the ODA Holder’s been made based on this comment. ODAR initial cost would be $12,020.
authority until its performance Response: Based on these responses,
Comments on the Proposed Regulatory
improves. The language regarding the Final Regulatory Evaluation uses an
Evaluation
priority of the investigation has been average of these costs resulting in an
deleted. Comment: United Airlines, which initial cost of $9,640 for the typical large
Comment: IAE and United holds current DAS and SFAR 36 ODAR that transitions to an ODA.
Technologies state that the proposed authorizations, opposes the rule because Comment: In the Initial Regulatory
rule would require an ODA Unit to it would have to reapply under ODA to Evaluation, we estimated that the
investigate safety concerns that it or the continue using its current authority. average annual cost for a large ODAR
FAA identifies. This is not a United Airlines comments that as would be $6,410 and the annual cost for
responsibility of current ODAR holders, proposed, an ODA would increase its a small ODAR would be $5,310. In its
and should not be imposed on ODA administrative workload when comment, IAE reports that it currently
Holders that only have manufacturing compared to the current delegation spend $29,870 every two years for the
inspection responsibilities. An ODA program. oversight/audit for their ODAR.
Unit may not have personnel with the Response: As noted in the Initial International Aero Engines estimates
expertise to conduct these Regulatory Evaluation, the FAA expects that the total cost of this annual
investigations. If imposed, this that the initial administrative burden requirement would be $56,660 over two
requirement should be on the ODA will be slightly greater than that under years. Thus, their annual incremental
Holder. The commenter also states that the current programs. However, we compliance costs for an ODA would be
the responsibility to investigate is expect that the annual administration $26,790 more (over two years) than their
already covered under § 21.3. The costs will be about the same as the current ODAR costs, or $13,395 in
language in the proposed rule would annual administration costs under its additional annual costs.
limit the FAA’s ability to conduct existing designation programs. As other Response: We used the IAE estimate
investigations. commenters noted, the ODA program of $13,395 as the annual cost in the
Response: The FAA agrees that an will provide organizations with greater Final Regulatory Evaluation for a large
ODA Holder is responsible for work scheduling flexibility and the ODAR annual cost.
investigation of service difficulties, and overall cost of their work will decrease Comment: Pratt and Whitney
has revised the rule language because they can use their resources estimated an annual cost of $138,900 for
accordingly. However, while the more efficiently. The ODA is also their ODA.
requirement may be redundant to § 21.3 designed to streamline the process when Response: It was not clear whether
for an ODAR, some ODA Holders might an organization seeks to add to its this estimate is the incremental cost of
issue certificates to other persons, and designated functions. No change to the going from its current authorization or
the requirement to investigate safety rule has been made based on this whether it is the total cost of operating
concerns does not duplicate the comment. an ODA. Consequently, in light of the
requirements of part 21. The FAA does Comment: Boeing comments that our Boeing and IAE comments, we
not agree that the proposed language estimated ODA costs were an order of determined that the IAE estimate was
would limit our ability to conduct magnitude too low. In a telephone the appropriate estimate of the annual
investigations. The rule has been conversation (a summary of which is in cost of a large ODAR.
revised as noted above as a result of this the docket), a Boeing representative
clarified that its written comment was Discussion of Changes and
comment.
based on the total cost to move from a Clarifications to the Proposed
Section 183.67 Transferability and DOA, DAS, or SFAR 36 designation to Requirements
Duration an ODA and not based on the As noted above, we have significantly
Comment: Several commenters, incremental cost to move from a DDS to changed the format of the final rule
including GE Aircraft Engines, an ODA. The Boeing representative language to simplify it and increase its
Gulfstream, and Boeing, state that the reported that the cost of going from a readability. In some cases, text has been
authorization should not have an DDS to an ODA would be about 10 moved or regrouped into more intuitive
expiration date and should remain percent of the total cost that it had sections and paragraphs, and the
effective until the FAA revokes it or the included in its comment. He concluded heading changed to better reflect the
applicant surrenders it. The commenters that FAA estimates in the Initial content of the section. Any substantive
state that renewing authorizations is an Regulatory Evaluation of the unit costs changes, of which there were few, are
unnecessary step and will only increase of moving from a DDS to an ODA (an noted here. This section will not discuss

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59942 Federal Register / Vol. 70, No. 197 / Thursday, October 13, 2005 / Rules and Regulations

language changes made to clarify the interpretation that unit members are the function requested. The phrase ‘‘in
intent or format of the rule. performing functions on ‘‘behalf of the aircraft certification’’ has been removed.
administrator.’’ This definition implied
Section 21.230 Compliance Dates Section 183.53 Procedures Manual
that the ODA Unit members were the
Proposed § 21.230 has been ‘‘designees,’’ when, in fact, the ODA Section 183.53 has been revised and
eliminated; it did not contain Holder is the designated organization its paragraphs redesignated. Based on
compliance dates as the title suggested. that is authorized to perform the comments received, the language has
The expiration of DOA has been added functions on behalf of the been revised to allow for an ODA
to § 21.235. No reference to part 183 is Administrator. The ODA Unit is defined Holder to make minor changes to the
included since a reference to ODA is not as the identified individuals within the procedures manual without FAA
necessary. The proposed phrase ‘‘no ODA Holder who perform the functions. approval. A description of the minor
person may apply for’’ is incorrect and changes allowed must be defined in the
has been revised to read ‘‘the Section 183.45 Issuance of approved procedures manual.
Administrator will no longer accept.’’ Organization Designation Proposed paragraph 183.53(c) has
Authorizations been clarified to require definition of
Section 21.430 Compliance Dates the organizational structure and
The description of the contents of the
Proposed 21.430 has been eliminated; Letter of Designation in paragraph (a) responsibilities of both the ODA Holder
it did not contain compliance dates as has been removed since it was non- and ODA Unit. The proposed rule was
the title suggested. The expiration of regulatory in nature. unclear whether the requirement to
DAS has been added to § 21.435. No define the organizational structure
reference to part 183 is included since Section 183.47 Qualifications applied to the ODA Unit, ODA Holder,
a reference to ODA is not necessary. The (Proposed § 183.47 Eligibility) or both.
phrase ‘‘no person may apply for’’ is Proposed paragraph 183.53(e) has
Section 183.47 has been extensively
incorrect and has been changed to ‘‘the been revised to clarify that the ODA
revised and re-titled ‘‘Qualifications.’’
Administrator will no longer accept.’’ Holder must perform periodic audits of
The proposed section listed a number of
both the ODA procedures and the ODA
SFAR 36 FAA certificates and presumed that a
Unit.
holder of any such certificate was
The proposed revision to SFAR 36 Proposed paragraph 183.53(h) has
‘‘eligible’’ for an ODA. In fact, the
section 4 has been revised to been revised to clarify that the
primary requirement to become an ODA
incorporate language from the current procedures manual must contain only a
Holder is sufficient experience
rule regarding the certificate holding description of the training required for
performing the authorized functions.
district office that was inadvertently left ODA Unit members. As proposed, it
The certificates listed appeared to be
out of the proposed rule revision. The appeared that the actual training
requirements to perform certain
language addressing application for an material was required to be included in
functions, rather than eligibility
ODA under part 183 has been removed, the manual.
requirements to be granted an ODA. The Proposed paragraph 183.53(j) has
since it is outside the scope of SFAR 36
section has been revised to require only been revised to require position
and is not regulatory in nature.
that an applicant have adequate descriptions and required qualifications
A new expiration date for SFAR 36
facilities, experience performing the only for the ODA Unit members.
has been incorporated into the text.
functions sought, and experience with A new procedures manual
Section 183.1 Scope FAA policies and procedures related to requirement has been added in revised
The word ‘‘private’’ has been deleted the functions sought. Based on paragraph 183.53(c)(15) requiring ‘‘Any
from paragraphs (a) and (b) because it is comments received, we have deleted the other information required by the
unnecessary. The introductory text of proposed requirement that the ODA Administrator necessary to supervise
this section contains the term ‘‘private Holder have facilities located within the the ODA Holder in the performance of
person,’’ while paragraphs (a) and (b) United States. its authorized functions.’’ This is
are intended to distinguish designations Section 183.49 Authorized Functions intended to allow the FAA to revise
granted to individuals from those future procedures manual requirements
granted to organizations. Section 183.49 has been extensively in policy materials without amending
revised. The list of specific authorized the rule language.
Section 183.15 Duration of Certificates functions has been removed, as
Proposed paragraph 183.15(b) used identification of these functions was not Section 183.55 Limitations
the term ‘‘Certificate of Authority;’’ we necessary. This section now provides The substance of proposed paragraph
have replaced it with the more generic the authority for the Administrator to 183.55(a) has been moved to § 183.49,
term ‘‘proof of authorization.’’ delegate any statutorily authorized and the remaining sections redesignated
Certificates of Authority are specific to function. accordingly. Proposed paragraph
certain types of designees, while the 183.55(b) has been revised to require
Section 183.51 Personnel
expiration date described in this section notification of any change that may
will be included on all types of Section 183.51 has been re-titled affect performance of an authorized
documentation used to identify ‘‘ODA Unit Personnel’’ to more function, rather than only changes
representatives of the Administrator. accurately describe its content. within the ODA Unit or ODA Holder.
Paragraph 183.51(b) has been revised For example, changes that are not
Section 183.41 Applicability and based on comments submitted. As within the Unit or Holder, such as
Definitions proposed, the language inferred that changes in facilities, may require
Proposed paragraph (a)(2) has been experience and expertise ‘‘in aircraft reporting. Additionally, proposed
removed. The definitions in § 183.41(b) certification’’ is required to make paragraph 183.55(d) was revised to
have been reordered in a more logical conformity determinations, or issue make the ODA Holder, rather than the
sequence. The definition of ODA Unit airworthiness certificates. What is ODA Unit subject to limitations
has been revised to prevent an required is experience and expertise in specified by the Administrator.

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Limitations are actually imposed on the The intent of proposed § 183.65(c) are based on clerical, technical, and
ODA Holder, and flow down to the ODA regarding operational approvals has overhead expenses.
Unit. been moved to new § 183.65 and titled Estimates of the burden created by the
‘‘Continuing Requirements: Operational rule are based on the following: The rule
Section 183.57 Responsibilities of an
Approvals.’’ The section has been will phase out over three years the
ODA Holder revised to clarify that the ODA Holder existing DAS and DOA rules contained
New paragraph 183.57(e) contains the must notify the FAA of problems with in Subparts J and M of part 21, as well
requirement from proposed § 183.59 to operational approvals and investigate as SFAR No. 36. The collection and
notify the FAA of a change that may those matters. This section requires that recordkeeping requirements imposed by
affect the ODA Holder’s ability to meet the ODA Holder inform the those rules will transition to the
the regulations requirements. Administrator of any error in issuance requirements contained here over the
of an operational approval (certificate or initial three-year period. In addition,
Section 183.59 Continued Eligibility
authorization), and when instructed by existing ODARs that are currently
The provisions of proposed § 183.59 the Administrator, suspend issuance of managed under part 183 will also be
have been moved to § 183.57, and any similar approval until corrective converted to ODA over the initial three-
subsequent sections redesignated action is implemented. This section also year period. As a result, the initial three-
accordingly. requires that the ODA Holder year burden will be large, with a smaller
Section 183.61 Inspection investigate any problem. burden over the life of the program. It
Paperwork Reduction Act is expected that about 180 applications
This section has been redesignated as
will be processed within the first three
§ 183.59. As required by the Paperwork years of the program, with an estimated
Section 183.63 Records and Reports Reduction Act of 1995 (44 U.S.C. 10 more applications being submitted
3507(d)), the FAA submitted a copy of per year over the life of the program.
This section has been redesignated as the information collection
§ 183.61, and extensively revised based The annual cost to the Federal
requirements(s) in this final rule to the Government to analyze and process the
on comments received. The description Office of Management and Budget for its
of the content of records has been information received is estimated to be
review. An agency may not collect or $69,300 per year. This estimate is based
revised for clarity. Based on comments sponsor the collection of information,
received, most airworthiness certificates on 1260 hours at $55.00 per hour.
nor may it impose an information
and approvals must be maintained only collection requirement unless it International Compatibility
for two years, rather than indefinitely as displays a currently valid Office of In keeping with U.S. obligations
proposed. However, airworthiness Management and Budget (OMB) control under the Convention on International
certificates and approvals supporting number. Civil Aviation, it is FAA policy to
type design approval projects must be This rule contains information
comply with International Civil
maintained for the duration of the collections that are subject to review by
Aviation Organization (ICAO) Standards
authorization. Based on comments OMB under the Paperwork Reduction
and Recommended Practices to the
received, the requirement to maintain Act of 1995 (Pub. L. 104–13). OMB has
maximum extent practicable. The FAA
inspection records proposed in not yet approved the collection of this
has determined that there are no ICAO
§ 183.63(c)(1) has been removed and information.
This rule was proposed in the Federal Standards and Recommended Practices
periodic audit and corrective action
Register on January 21, 2004. At that that correspond to these regulations.
records must be maintained for five
years, rather than indefinitely, as time the FAA requested public Economic Assessment, Regulatory
proposed. Service difficulty records comments on the proposed information Flexibility Determination, Trade Impact
must also be maintained for five years collection requirements. Based on Assessment, and Unfunded Mandates
rather than for two years as proposed in comments received, the proposed Assessment
§ 183.63(c)(2). These retention requirement for respondents to maintain
Preamble Summary
requirements are intended to allow aircraft inspection records has been
access to a greater amount of service removed, and periodic audit and This portion of the preamble
history information if an investigation is corrective action records must be summarizes our analysis of the
required. maintained for five years, rather than economic impacts of the rule. We
indefinitely. Additionally, service suggest readers seeking greater detail
Section 183.65 Data Review and difficulty information must be retained read the full regulatory evaluation,
Service Experience for five years, rather than the proposed which is in the docket.
This section has been redesignated two years, to ensure adequate Changes to Federal regulations must
183.63, and retitled ‘‘Continuing information is available in the event undergo several economic analyses.
Requirements: Products, Parts or safety issues require investigation. See First, Executive Order 12866 directs that
Appliances.’’ Proposed paragraphs the disposition of comments and each Federal agency shall propose or
183.65(a) and (b) have been revised to discussion of changes and clarifications adopt a regulation only upon a reasoned
clarify the requirements on the ODA to the proposed language for more determination that the benefits of the
Holder. A new requirement has been information. No comments addressed intended regulation justify its costs.
added to require the ODA Holder to recordkeeping or reporting cost or Second, the Regulatory Flexibility Act
actively monitor service difficulties. burden estimates. of 1980 requires agencies to analyze the
This is now done by current delegated Annual Burden Estimate: We estimate economic impact of regulatory changes
organizations and is appropriate for the proposed rule imposes an annual on small entities. Third, the Trade
inclusion in the regulatory text. Based public reporting burden of $235,840 Agreements Act (19 U.S.C. 2531–2533)
on comments received, the notification based on 4288 hours at $55.00 per hour. prohibits agencies from setting
and investigation requirements now The estimated recordkeeping costs are standards that create unnecessary
apply to the ODA Holder rather than the $161,700, based on 2940 hours at $55.00 obstacles to the foreign commerce of the
ODA Unit. per hour. Both of these cost estimates United States. In developing U.S.

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59944 Federal Register / Vol. 70, No. 197 / Thursday, October 13, 2005 / Rules and Regulations

standards, the Trade Act requires received positive industry responses to for a small program. The average annual
agencies to consider international the proposed rule and we received no incremental undiscounted cost will be
standards and, where appropriate, to suggested alternatives other than to $13,450 for an existing DAS, DOA, or
use them as the basis for U.S. standards. maintain the current system. SFAR 36 holder with a large program
Fourth, the Unfunded Mandates Reform and $6,850 for those with a small
Cost Assumptions and Sources of program. We received two comments on
Act of 1995 (Pub. L. 104–4) requires
agencies to prepare a written assessment Information the estimated costs for a manufacturing
of the costs, benefits, and other effects Period of analysis is 2006–2015. ODAR program to convert to an ODA.
of proposed or final rules that include Final rule will be effective by January Taking the average of these costs, the
a Federal mandate likely to result in the 1, 2006. average undiscounted initial cost for a
expenditure by State, local, or tribal Discount rate is 7 percent. large ODAR program will be $9,640 and
governments, in the aggregate, or by the Fully burdened labor rate for an $7,505 for a small ODAR program. The
private sector, of $100 million or more aviation engineer is $110 an hour. average incremental annual
annually (adjusted for inflation). The affected parties will be 4 aircraft undiscounted cost will be $6,410 for a
In conducting these analyses, we and two propeller manufacturers that large ODAR program and $5,310 for a
determined this rule: (1) Has benefits have 7 DOAs, 26 companies that have small ODAR program.
that justify its costs, is not a ‘‘significant 33 DASs, 13 companies that have 13
SFAR 36 authorizations, 42 Cost Benefit Summary
regulatory action’’ as defined in section
3(f) of Executive Order 12866, and is not organizations that have 47 maintenance Industry worked with us to improve
‘‘significant’’ as defined in DOT’s ODARs, and 81 organizations that have our oversight efficiency and maintain
Regulatory Policies and Procedures; (2) 89 manufacturing ODARs. We did not system safety. This rule creates a more
does not have a significant economic estimate a cost for the unknown number efficient system with benefits to both
impact on a substantial number of small of organizations that do not currently the industry and to the FAA. There were
entities; (3) has a neutral international have a designation authorization may 10 industry comments that supported
trade impact; and (4) does not impose choose to apply for an ODA. the proposed rule as being cost
an unfunded mandate on State, local, or We obtained data from members of an beneficial and one industry comment
tribal governments, or on the private ARAC working group, existing DAS, opposing it. As noted earlier, under
sector. These analyses, available in the DOA, and SFAR 36 holders, and from certain assumptions described in
docket, are summarized as follows. public comments on the proposed rule. Section III.C of the Regulatory
Evaluation, the present value of the
Total Benefits and Costs of This Estimated Benefits
annual reduction in the opportunity
Rulemaking We determined that the rule will costs from the ODA program could be
The aviation industry reported that generate both improved safety and $24.9 million, which is greater than the
the conversion to an ODA system allows reduced costs. By shifting our present value of the compliance costs of
them to schedule their manufacturing, inspection focus from reviewing test $12.3 million.
modification, and repair activities more results to overseeing the designation
program, we will be able to more Changes From the NPRM to the Final
efficiently than they can under the Rule
current designee system. It also allows efficiently use our resources while
us to more effectively monitor the extending our oversight coverage, Based on the comments received from
organizational designee system. Under thereby increasing safety. In the NPRM, the NPRM, we made three moderate
certain assumptions discussed in detail we requested that commenters provide changes in the unit cost estimates from
in the Regulatory Evaluation, we quantitative estimates of their cost those in the NPRM to those in the final
estimate that the aviation industry could savings from substituting an ODA for rule. In response to two comments from
annually save about $3.445 million in their current designation authorizations. manufacturers that hold ODARs, we
opportunity costs and a total present We did not receive any quantitative increased our annual compliance costs
value savings of $24.9 million between estimates, but nearly all of the industry for a large ODAR holder from the
2006 and 2015. We calculate that the commenters noted that an ODA will estimated $7,320 in the NPRM to $9,640
total initial costs for the ODA program allow them to more efficiently schedule in the final rule analysis. In the NPRM,
will be $1.725 million spread over three their work and save them time. This we had estimated that participants in
years. The incremental annual costs of view was also the consensus in the the DDS program would have minimal
operating ODA programs between 2006 ARAC working group. Under certain costs. We received two comments
and 2015 will be $17.4 million. The assumptions discussed in the stating that there will be costs for these
average annual cost will be $2.175 Regulatory Evaluation, we estimate that programs to apply for an ODA. Based on
million. The present value of the total the aviation industry could annually the comments, we increased our initial
costs for the ODA program will be $12.3 save $3.445 million in undiscounted compliance costs for DOA, DAS, and
million. opportunity costs. We received SFAR 36 holders from the estimated
comments from individuals who believe minimal amount in the NPRM to
Who Is Potentially Affected by This that the ODA program will increase $13,480 in the final rule for a large
Rulemaking costs. We disagree with those program and $7,980 in the final rule for
Aircraft manufacturers, air carriers, comments. Were an ODA to increase an a small program. Finally, we increased
commercial operations, repair stations, organization’s net costs, that our annual compliance costs for DOA,
and aircraft parts manufacturers may be organization has the option to not DAS, and SFAR 36 holders from a
affected by this rule. participate. minimal amount in the NPRM to
$13,450 in the final rule for a large
Alternatives We Considered Costs of This Rulemaking program and $6,850 in the final rule for
We did not consider other alternatives The average undiscounted initial cost a small program. As a result, we
to this final rule because the proposed for an existing DAS, DOA, or SFAR 36 calculate that the total initial costs for
rule had been developed in conjunction holder to transition to an ODA will be the final rule will be $1.725 million
with the ARAC recommendations. We $13,480 for a large program and $7,980 whereas we had estimated that it would

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Federal Register / Vol. 70, No. 197 / Thursday, October 13, 2005 / Rules and Regulations 59945

be $1.144 million in the NPRM. unnecessary obstacles to the foreign intends to continue to have a
Whereas we had estimated that the commerce of the United States. designation authorization. Most of the
annual incremental cost would be Legitimate domestic objectives, such as 4,000 entities that participate in the
$1.102 million in the NPRM, for the safety, are not considered unnecessary aviation industry do not have
final rule it will now be $2.175 million. obstacles. The FAA assessed the designation authorizations. Rather, they
potential effect of this final rule and perform their necessary testing and
Regulatory Flexibility Determination
determined that because the compliance examinations using FAA-approved
The Regulatory Flexibility Act of 1980 costs are minimal, and there will likely individuals operating under standard
(RFA) establishes ‘‘as a principle of be net cost savings from increased practices. This rule does not require
regulatory issuance that agencies shall scheduling efficiencies for primarily these entities to have an ODA program
endeavor, consistent with the objective domestic organizations, this final rule and they can continue to operate using
of the rule and of applicable statutes, to will slightly reduce costs for U.S. the existing system. As a result, the
fit regulatory and informational organizations. It has no effect on foreign Administrator certifies that the rule will
requirements to the scale of the organizations. Thus, the final rule has a not have a significant impact on a
business, organizations, and minimal effect on foreign commerce. substantial number of small entities.
governmental jurisdictions subject to
regulation.’’ To achieve that principle, Unfunded Mandates Reform Act International Trade Impact Assessment
the RFA requires agencies to solicit and The Unfunded Mandates Reform Act As the compliance costs are minimal,
consider flexible regulatory proposals of 1995 (the Act) is intended, among this final rule will have a minimal trade
and to explain the rationale for their other things, to curb the practice of impact.
actions. The RFA covers a wide range of imposing unfunded Federal mandates
small entities, including small on State, local, and tribal governments. Unfunded Mandates Reform Act
businesses, not-for-profit organizations Title II of the Act requires each Federal The Unfunded Mandates Reform Act
and small governmental jurisdictions. agency to prepare a written statement of 1995 (the Act) is intended, among
Agencies must perform a review to assessing the effects of any Federal other things, to curb the practice of
determine whether a proposed or final mandate in a proposed or final agency imposing unfunded Federal mandates
rule will have a significant economic rule that may result in an expenditure on State, local, and tribal governments.
impact on a substantial number of small of $100 million or more (adjusted Title II of the Act requires each Federal
entities. If the agency determines that it annually for inflation) in any one year agency to prepare a written statement
will, the agency must prepare a by State, local, and tribal governments, assessing the effects of any Federal
regulatory flexibility analysis as in the aggregate, or by the private sector; mandate in a proposed or final agency
described in the Act. In the Final such a mandate is deemed to be a rule that may result in an expenditure
Regulatory Evaluation, we note two ‘‘significant regulatory action.’’ The of $100 million or more (adjusted
important considerations for a small FAA currently uses an inflation- annually for inflation) in any one year
business impact. First, three of the four adjusted value of $120.7 million in lieu by State, local, and tribal governments,
categories of designations already of $100 million. in the aggregate, or by the private sector;
operate under programs that are very This final rule does not contain such such a mandate is deemed to be a
similar to the ODA program. Only the a mandate. The requirements of Title II ‘‘significant regulatory action.’’
ODARs do not currently operate under do not apply. We note that the rule would not
an ODA-like system. There are about impose a significant private sector cost.
4,000 aircraft repair stations and aircraft Regulatory Flexibility Determination
Thus, this rule does not contain such a
parts manufacturers (nearly all of which The Regulatory Flexibility Act of 1980 mandate and the requirements of Title
are small entities). Twenty of the 47 (RFA) establishes ‘‘as a principle of II of the Unfunded Mandates Reform
maintenance ODARs and 42 of the 89 regulatory issuance that agencies shall Act of 1995 do not apply.
manufacturing ODARs are operated by endeavor, consistent with the objective
small companies having fewer than of the rule and of applicable statutes, to Executive Order 13132, Federalism
1,500 employees. While there are a fit regulatory and informational The FAA has analyzed this final rule
substantial number of small entities, the requirements to the scale of the under the principles and criteria of
rule will not have a significant impact. business, organizations, and Executive Order 13132, Federalism. We
The rule will not require them to governmental jurisdictions subject to determined that this action will not
operate an ODA. They can apply for regulation.’’ To achieve that principle, have a substantial direct effect on the
one, but it is their choice. That is, if an the RFA requires agencies to solicit and States, or the relationship between the
ODA makes business sense, a small consider flexible regulatory proposals National Government and the States, or
business has the option of applying for and to explain the rationale for their on the distribution of power and
it, but is not required to have one. actions. The RFA covers a wide range of responsibilities among the various
Second, the expected efficiency gains small entities, including small levels of government, and therefore does
for some of these companies will exceed businesses, not-for-profit organizations not have federalism implications.
the expected compliance costs. and small governmental jurisdictions.
Agencies must perform a review to Environmental Analysis
In light of this evidence, the FAA
Administrator certifies that the rule will determine whether a proposed or final FAA Order 1050.1E identifies FAA
not have a significant economic impact rule will have a significant economic actions that are categorically excluded
on a substantial number of small impact on a substantial number of small from preparation of an environmental
entities. entities. If the agency determines that it assessment or environmental impact
will, the agency must prepare a statement under the National
International Trade Impact Assessment regulatory flexibility analysis as Environmental Policy Act in the
The Trade Agreements Act of 1979 described in the Act. absence of extraordinary circumstances.
prohibits Federal agencies from The rule will require every The FAA has determined this
establishing any standards or engaging organization that has a designation rulemaking action qualifies for the
in related activities that create authorization to apply for an ODA if it categorical exclusion identified in

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59946 Federal Register / Vol. 70, No. 197 / Thursday, October 13, 2005 / Rules and Regulations

paragraph 303(d) and involves no Aircraft Certification Office for the area 44713, 44716–44717, 44722, 44901, 44903–
extraordinary circumstances. in which the manufacturer is located. 44904, 44912, 46105.
(b) An application must include the
Regulations That Significantly Affect PART 135—OPERATING
names, signatures, and titles of the
Energy Supply, Distribution, or Use REQUIREMENTS: COMMUTER AND
persons for whom authorization to sign
The FAA has analyzed this final rule airworthiness certificates, repair and ON DEMAND OPERATIONS AND
under Executive Order 13211, Actions alterations forms, and inspection forms RULES GOVERNING PERSONS ON
Concerning Regulations that is requested. BOARD SUCH AIRCRAFT
Significantly Affect Energy Supply, (c) After November 14, 2006, the ■ 5. The authority citation for part 135
Distribution, or Use (May 18, 2001). We Administrator will no longer accept continues to read as follows:
have determined that it is not a applications for a Delegation Option
‘‘significant energy action’’ under the Authorization. Authority: 49 U.S.C. 106(g), 40113, 44701–
executive order because it is not a (d) After November 14, 2009, no 44702, 44705, 44709, 44711–44713, 44715–
‘‘significant regulatory action’’ under 44717, 44722.
person may perform any function
Executive Order 12866, and it is not contained in a Delegation Option PART 145—REPAIR STATIONS
likely to have a significant adverse effect Authorization issued under this subpart.
on the supply, distribution, or use of ■ 3. Section 21.435 is revised to read as ■ 6. The authority citation for part 145
energy. follows: continues to read as follows:
List of Subjects § 21.435 Application. Authority: 49 U.S.C. 106(g), 40113, 44701–
44702, 44707, 44717.
14 CFR Part 21 (a) An applicant for a Designated
Alteration Station authorization must ■ 7. In parts 121, 135, and 145, Special
Aircraft, Aviation safety, Exports, Federal Aviation Regulation No. 36, the
Imports, Reporting and recordkeeping submit an application, in writing and
signed by an official of the applicant, to text of which is found at the beginning
requirements. of part 121, is amended by revising the
the Aircraft Certification Office
14 CFR Part 121 responsible for the geographic area in introductory text of section 4; revising
which the applicant is located. The the introductory text of section 7;
Air carriers, Aircraft, Airmen, revising the termination date to read as
Aviation safety, Reporting and application must contain:
(1) The repair station certificate follows.
recordkeeping requirements, Safety,
Transportation. number held by the repair station Special Federal Aviation Regulation
applicant, and the current ratings No. 36
14 CFR Part 135 covered by the certificate;
* * * * *
Air taxis, Aircraft, Airmen, Aviation (2) The air carrier or commercial
4. Application. The applicant for an
safety, Reporting and recordkeeping operator operating certificate number
authorization under this Special Federal
requirements. held by the air carrier or commercial
Aviation Regulation must submit an
operator applicant, and the products it
14 CFR Part 145 application before November 14, 2006,
may operate and maintain under the
Aircraft, Aviation safety, Reporting in writing, and signed by an officer of
certificate;
and recordkeeping requirements. the applicant, to the certificate holding
(3) A statement by the manufacturer
district office charged with the overall
14 CFR Part 183 applicant of the products for which he
inspection of the applicant’s operations
holds the type certificate;
Aircraft, Airmen, Authority (4) The names, signatures, and titles under its certificate. The application
delegations (Government agencies), of the persons for whom authorization must contain—
Reporting and recordkeeping to issue supplemental type certificates * * * * *
requirements. or experimental certificates, or amend 7. Duration of Authorization. Each
airworthiness certificates, is requested; authorization issued under this Special
The Amendments
and Federal Aviation Regulation is effective
■ The Federal Aviation Administration (5) A description of the applicant’s from the date of issuance until,
amends parts 21, 121, 135, 145, and 183 facilities, and of the staff with which November 14, 2009, unless it is earlier
of the Federal Aviation Regulations as compliance with § 21.439(a)(4) is to be surrendered, suspended, revoked or
follows: shown. otherwise terminated. Upon termination
(b) After November 14, 2006, the of such authorization, the terminated
PART 21—CERTIFICATION Administrator will no longer accept authorization holder must:
PROCEDURES FOR PRODUCTS AND applications for a Designated Alteration * * * * *
PARTS Station authorization. This Special Federal Aviation
■ 1. The authority citation for part 21 (c) After November 14, 2009, no Regulation terminates November 14,
continues to read as follows: person may perform any function 2009.
contained in a Designated Alteration * * * * *
Authority: 42 U.S.C. 7572; 49 U.S.C.
106(g), 40105, 40113, 44701–44702, 44707,
Station authorization issued under this
44709, 44711, 44713, 44715, 45303. subpart. PART 183—REPRESENTATIVES OF
THE ADMINISTRATOR
■ 2. Section 21.235 is revised to read as PART 121—OPERATING
follows: REQUIREMENTS: DOMESTIC, FLAG, ■ 8. The authority citation for part 183
AND SUPPLEMENTAL OPERATIONS continues to read as follows:
§ 21.235 Application.
■ 4. The authority citation for part 121 Authority: 31 U.S.C. 9701; 49 U.S.C.
(a) An application for a Delegation 106(g), 40113, 44702, 44721, 45303.
Option Authorization must be continues to read as follows:
submitted, in a form and manner Authority: 49 U.S.C. 106(g), 40113, 40119, ■ 9. Section 183.1 is revised to read as
prescribed by the Administrator, to the 44101, 44701–44702, 44705, 44709–44711, follows:

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§ 183.1 Scope. 183.67 Transferability and duration. procedures to perform the functions for
This part describes the requirements which authorization is requested; and
§ 183.41 Applicability and definitions.
for designating private persons to act as (c) Have sufficient, relevant
representatives of the Administrator in (a) This subpart contains the experience to perform the functions for
examining, inspecting, and testing procedures required to obtain an which authorization is requested.
persons and aircraft for the purpose of Organization Designation Authorization,
which allows an organization to perform § 183.49 Authorized functions.
issuing airman, operating, and aircraft
certificates. In addition, this part states specified functions on behalf of the (a) Consistent with an ODA Holder’s
the privileges of those representatives Administrator related to engineering, qualifications, the Administrator may
and prescribes rules for the exercising of manufacturing, operations, delegate any function determined
those privileges, as follows: airworthiness, or maintenance. appropriate under 49 U.S.C. 44702(d).
(b) Definitions. For the purposes of (b) Under the general supervision of
(a) An individual may be designated
this subpart: the Administrator, an ODA Unit may
as a representative of the Administrator
Organization Designation perform only those functions, and is
under subparts B or C of this part.
Authorization (ODA) means the subject to the limitations, listed in the
(b) An organization may be designated
authorization to perform approved ODA Holder’s procedures manual.
as a representative of the Administrator
functions on behalf of the
by obtaining an Organization § 183.51 ODA Unit personnel.
Administrator.
Designation Authorization under Each ODA Holder must have within
ODA Holder means the organization
subpart D of this part. its ODA Unit—
that obtains the authorization from the
■ 10. Section 183.15 is amended by Administrator, as identified in a Letter (a) At least one qualified ODA
removing paragraph (c), redesignating of Designation. administrator; and either
paragraph (d) as paragraph (c), and ODA Unit means an identifiable group (b) A staff consisting of the
revising paragraphs (a) and (b) to read of two or more individuals within the engineering, flight test, inspection, or
as follows: ODA Holder’s organization that maintenance personnel needed to
performs the authorized functions. perform the functions authorized. Staff
§ 183.15 Duration of certificates. members must have the experience and
(a) Unless sooner terminated under § 183.43 Application. expertise to find compliance, determine
paragraph (c) of this section, a An application for an ODA may be conformity, determine airworthiness,
designation as an Aviation Medical submitted after November 14, 2006. An issue certificates or issue approvals; or
Examiner is effective for one year after application for an ODA must be (c) A staff consisting of operations
the date it is issued, and may be submitted in a form and manner personnel who have the experience and
renewed for additional periods of one prescribed by the Administrator and expertise to find compliance with the
year at the Federal Air Surgeon’s must include the following: regulations governing the issuance of
discretion. A renewal is effected by a (a) A description of the functions for pilot, crew member, or operating
letter and issuance of a new which authorization is requested. certificates, authorizations, or
identification card specifying the (b) A description of how the applicant endorsements as needed to perform the
renewal period. satisfies the requirements of § 183.47 of functions authorized.
(b) Unless sooner terminated under this part;
paragraph (c) of this section, a (c) A description of the applicant’s § 183.53 Procedures manual.
designation as Flight Standards or organizational structure, including a No ODA Letter of Designation may be
Aircraft Certification Service Designated description of the proposed ODA Unit issued before the Administrator
Representative as described in as it relates to the applicant’s approves an applicant’s procedures
§§ 183.27, 183.29, 183.31, or 183.33 is organizational structure; and manual. The approved manual must:
effective until the expiration date shown (d) A proposed procedures manual as (a) Be available to each member of the
on the document granting the described in § 183.53 of this part. ODA Unit;
authorization. (b) Include a description of those
§ 183.45 Issuance of Organization changes to the manual or procedures
* * * * * Designation Authorizations. that may be made by the ODA Holder.
■ 11. A new subpart D is added to part (a) The Administrator may issue an All other changes to the manual or
183 to read as follows: ODA Letter of Designation if: procedures must be approved by the
(1) The applicant meets the applicable Administrator before they are
Subpart D—Organization Designation requirements of this subpart; and implemented.
Authorization (2) A need exists for a delegation of (c) Contain the following:
Secs. the function. (1) The authorized functions and
183.41 Applicability and definitions. (b) An ODA Holder must apply to and limitations, including the products,
183.43 Application. obtain approval from the Administrator certificates, and ratings;
183.45 Issuance of Organization for any proposed changes to the (2) The procedures for performing the
Designation Authorizations. functions or limitations described in the authorized functions;
183.47 Qualifications. ODA Holder’s authorization. (3) Description of the ODA Holder’s
183.49 Authorized functions. and the ODA Unit’s organizational
183.51 ODA Unit personnel. § 183.47 Qualifications. structure and responsibilities;
183.53 Procedures manual. To qualify for consideration as an (4) A description of the facilities at
183.55 Limitations. ODA, the applicant must— which the authorized functions are
183.57 Responsibilities of an ODA Holder.
(a) Have sufficient facilities, performed;
183.59 Inspection.
183.61 Records and reports. resources, and personnel, to perform the (5) A process and a procedure for
183.63 Continuing requirements: Products, functions for which authorization is periodic audit by the ODA Holder of the
parts or appliances. requested; ODA Unit and its procedures;
183.65 Continuing requirements: (b) Have sufficient experience with (6) The procedures outlining actions
Operational approvals. FAA requirements, processes, and required based on audit results,

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59948 Federal Register / Vol. 70, No. 197 / Thursday, October 13, 2005 / Rules and Regulations

including documentation of all (e) Notify the Administrator of any (2) The data and records documenting
corrective actions; change that could affect the ODA the ODA Unit member’s approval or
(7) The procedures for communicating Holder’s ability to continue to meet the determination of compliance.
with the appropriate FAA offices requirements of this part within 48 (d) For all records required by this
regarding administration of the hours of the change occurring. section to be maintained, each ODA
delegation authorization; Holder must:
(8) The procedures for acquiring and § 183.59 Inspection. (1) Ensure that the records and data
maintaining regulatory guidance The Administrator, at any time and are available to the Administrator for
material associated with each for any reason, may inspect an ODA inspection at any time;
authorized function; Holder’s or applicant’s facilities, (2) Submit all records and data to the
(9) The training requirements for ODA products, components, parts, Administrator upon surrender or
Unit personnel; appliances, procedures, operations, and termination of the authorization.
(10) For authorized functions, the records associated with the authorized (e) Each ODA Holder must compile
procedures and requirements related to or requested functions. and submit any report required by the
maintaining and submitting records; Administrator to exercise his
(11) A description of each ODA Unit § 183.61 Records and reports.
supervision of the ODA Holder.
position, and the knowledge and (a) Each ODA Holder must ensure that
experience required for each position; the following records are maintained for § 183.63 Continuing requirements:
(12) The procedures for appointing the duration of the authorization: Products, parts or appliances.
ODA Unit members and the means of (1) Any records generated and For any approval or certificate for a
documenting Unit membership, as maintained while holding a previous product, part or appliance issued under
required under § 183.61(a)(4) of this delegation under subpart J or M of part the authority of this subpart, or under
part; 21, or SFAR 36 of this chapter. the delegation rules of subpart J or M of
(13) The procedures for performing (2) For any approval or certificate part 21, or SFAR 36 of this chapter, an
the activities required by § 183.63 or issued by an ODA Unit member (except ODA Holder must:
§ 183.65 of this part; those airworthiness certificates and (a) Monitor reported service problems
(14) The procedures for revising the approvals not issued in support of type related to certificates or approvals it
manual, pursuant to the limitations of design approval projects): holds;
paragraph (b) of this section; and (i) The application and data required (b) Notify the Administrator of:
(15) Any other information required to be submitted under this chapter to (1) A condition in a product, part or
by the Administrator necessary to obtain the certificate or approval; and appliance that could result in a finding
supervise the ODA Holder in the (ii) The data and records documenting
of unsafe condition by the
performance of its authorized functions. the ODA Unit member’s approval or
Administrator; or
determination of compliance.
§ 183.55 Limitations. (3) A list of the products, components, (2) A product, part or appliance not
(a) If any change occurs that may parts, or appliances for which ODA Unit meeting the applicable airworthiness
affect an ODA Unit’s qualifications or members have issued a certificate or requirements for which the ODA Holder
ability to perform a function (such as a approval. has obtained or issued a certificate or
change in the location of facilities, (4) The names, responsibilities, approval.
qualifications and example signature of (c) Investigate any suspected unsafe
resources, personnel or the
each member of the ODA Unit who condition or finding of noncompliance
organizational structure), no Unit
performs an authorized function. with the airworthiness requirements for
member may perform that function until
(5) A copy of each manual approved any product, part or appliance, as
the Administrator is notified of the
or accepted by the ODA Unit, including required by the Administrator, and
change, and the change is approved and
all historical changes. report to the Administrator the results of
appropriately documented as required
(6) Training records for ODA Unit the investigation and any action taken
by the procedures manual.
(b) No ODA Unit member may issue members and ODA administrators. or proposed.
a certificate, authorization, or other (7) Any other records specified in the (d) Submit to the Administrator the
approval until any findings reserved for ODA Holder’s procedures manual. information necessary to implement
the Administrator have been made. (8) The procedures manual required corrective action needed for safe
(c) An ODA Holder is subject to any under § 183.53 of this part, including all operation of the product, part or
other limitations as specified by the changes. appliance.
Administrator. (b) Each ODA Holder must ensure that
the following are maintained for five § 183.65 Continuing requirements:
Operational approvals.
§ 183.57 Responsibilities of an ODA years:
Holder. (1) A record of each periodic audit For any operational authorization,
The ODA Holder must— and any corrective actions resulting airman certificate, air carrier certificate,
(a) Comply with the procedures from them; and air operator certificate, or air agency
contained in its approved procedures (2) A record of any reported service certificate issued under the authority of
manual; difficulties associated with approvals or this subpart, an ODA Holder must:
(b) Give ODA Unit members sufficient certificates issued by an ODA Unit (a) Notify the Administrator of any
authority to perform the authorized member. error that the ODA Holder finds it made
functions; (c) For airworthiness certificates and in issuing an authorization or certificate;
(c) Ensure that no conflicting non- approvals not issued in support of a (b) Notify the Administrator of any
ODA Unit duties or other interference type design approval project, each ODA authorization or certificate that the ODA
affects the performance of authorized Holder must ensure the following are Holder finds it issued to an applicant
functions by ODA Unit members. maintained for two years; not meeting the applicable
(d) Cooperate with the Administrator (1) The application and data required requirements;
in his performance of oversight of the to be submitted under this chapter to (c) When required by the
ODA Holder and the ODA Unit. obtain the certificate or approval; and Administrator, investigate any problem

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concerning the issuance of an unless sooner terminated by the (3) Is no longer needed; or
authorization or certificate; and Administrator. (4) No longer meets the qualifications
(d) When notified by the (b) No ODA may be transferred at any required to perform authorized
Administrator, suspend issuance of time.
(c) The Administrator may terminate functions.
similar authorizations or certificates
until the ODA Holder implements all or temporarily suspend an ODA for any Issued in Washington, DC, on September
corrective action required by the reason, including that the ODA Holder: 30, 2005.
Administrator. (1) Has requested in writing that the Marion C. Blakey,
authorization be suspended or Administrator.
§ 183.67 Transferability and duration. terminated;
[FR Doc. 05–20470 Filed 10–12–05; 8:45 am]
(a) An ODA is effective until the date (2) Has not properly performed its
shown on the Letter of Designation, duties; BILLING CODE 4910–13–P

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