
[Federal Register Volume 81, Number 139 (Wednesday, July 20, 2016)]
[Rules and Regulations]
[Pages 47017-47027]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-17083]


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DEPARTMENT OF TRANSPORTATION

Federal Aviation Administration

14 CFR Parts 417, 420, 431, and 435

[Docket No.: FAA-2014-0418; Amdt. Nos. 417-4, 420-7, 431-4 and 435-3]
RIN 2120-AK06


Changing the Collective Risk Limits for Launches and Reentries 
and Clarifying the Risk Limit Used To Establish Hazard Areas for Ships 
and Aircraft

AGENCY: Federal Aviation Administration (FAA), DOT.

ACTION: Final rule.

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SUMMARY: The FAA is amending its regulations concerning the collective 
risk limits for commercial launches and reentries. These changes 
include: Separating the risk limits for commercial launches and 
reentries; aggregating the risk posed by impacting inert and explosive 
debris, toxic release, and far field blast overpressure; limiting the 
aggregate risk for these three hazards to 1 x 10-4; reducing 
the number of significant digits used in launch and reentry risk 
analysis; and various non-substantive clarifying revisions. These 
changes update FAA regulations to reflect the United States 
Government's greater experience with commercial launch and reentry and 
to align more closely the FAA's risk standards with those of other 
United States Federal agencies, while continuing to protect public 
safety.

DATES: Effective September 19, 2016.

ADDRESSES: For information on where to obtain copies of rulemaking 
documents and other information related to this final rule, see ``How 
To Obtain Additional Information'' in the SUPPLEMENTARY INFORMATION 
section of this document.

FOR FURTHER INFORMATION CONTACT: For technical questions concerning 
this action, contact Rene Rey, AST-300, Office of Commercial Space 
Transportation, Federal Aviation Administration, 800 Independence 
Avenue SW., Washington, DC 20591; telephone (202) 267-7538; email 
Rene.Rey@faa.gov.

SUPPLEMENTARY INFORMATION:

Authority for This Rulemaking

    The Commercial Space Launch Act of 1984, as amended and codified at 
51 United States Code (U.S.C.) Subtitle V--Commercial Space 
Transportation, Ch. 509, Commercial Space Launch Activities, 51 U.S.C. 
50901-50923 (the Act), authorizes the Secretary of Transportation and 
thus the FAA, through delegations, to oversee, license, and regulate 
commercial launch and reentry, and the operation of launch and reentry 
sites as carried out by U.S. citizens or within the United States. 51 
U.S.C. 50904, 50905. The Act directs the FAA to exercise this 
responsibility consistent with public health and safety, safety of 
property, and the national security and foreign policy interests of the 
United States. 51 U.S.C. 50905. Section 50901(a)(7), in relevant part, 
directs the FAA to regulate private sector launches, reentries, and 
associated services only to the extent necessary to protect the public 
health and safety and safety of property. The FAA is also responsible 
for encouraging, facilitating, and promoting commercial space launches 
and reentries by the private sector. 51 U.S.C. 50903.

I. Overview of Final Rule

    The FAA is adopting this final rule to revise certain regulations 
related to the collective risk limits for commercial launches and 
reentries in part 417 (Launch Safety), part 420 (License to Operate a 
Launch Site), part 431 (Launch and Reentry of a Reusable Launch Vehicle 
(RLV)), and part 435 (Reentry of a Reentry Vehicle Other Than a 
Reusable Launch Vehicle (RLV)) of Title 14 of the Code of Federal 
Regulations (14 CFR).
    This final rule divides the risk analysis for launch and reentry, 
providing a separate risk budget for each. For all launches, regardless 
of vehicle type, this final rule requires a single expected number of 
casualties (Ec) be calculated by aggregating the risk posed 
to the collective members of the public from three hazards: Impacting 
and inert explosive debris, toxic release, and far field blast 
overpressure. This final rule also revises the acceptable risk 
threshold for launch from an Ec of 30 x 10-6 for 
each hazard to an Ec of 1 x 10-4 for all three 
hazards combined. Furthermore, this final rule expresses the revised 
Ec limit using the correct number of significant digits to 
properly represent the uncertainty in Ec calculations. This 
final rule changes the FAA's collective risk limits for launch and 
reentry to more closely match the Ec standard currently used 
by the United States (U.S.) Air Force and the National Aeronautics and 
Space Administration (NASA) for government missions, and to account for 
the level of uncertainty that exists in the Ec calculations.
    This final rule also makes two revisions to Sec.  417.107 to 
clarify the launch and reentry regulations. The first revision removes 
the phrase ``including each planned impact'' from Sec.  417.107(b)(1) 
to clarify that public risk is assessed from lift-off through orbital 
insertion for orbital launches and from lift-off to final impact for 
suborbital launches. The second revision modifies Sec.  417.107(b)(3) 
and (b)(4) to make transparent the criteria for establishing hazard 
areas by replacing the references to equivalent levels of safety for 
water borne and aircraft hazard areas required for launch from a 
federal launch range with the actual levels of safety provided by 
hazard areas for launches from a federal range in 2006, the year the 
FAA promulgated Sec.  417.107. Under Sec.  417.107(b)(3), a hazard area 
for water borne vessels satisfies part 417 if the probability of impact 
with debris capable of causing a casualty on any potential water borne 
vessel within the hazard area does not exceed 0.00001 (1 x 
10-5). Under Sec.  417.107(b)(4), a hazard area for aircraft 
will satisfy part 417 if the probability of impact with debris capable 
of causing a casualty on any potential aircraft within that hazard area 
does not exceed 0.000001 (1 x 10-6). These clarifying edits 
do not change the risk requirement for launch licensees or launch 
license applicants.

Summary of the Costs and Benefits of the Final Rule

    The final rule will result in net benefits for both the commercial 
space transportation industry (industry) and government by reducing the 
number of waivers that must be prepared by the industry and processed 
by the government for launches with an aggregate Ec between 
90 x 10-6 and 149 x 10-6, and by averting 
unnecessary mission delays and scrubs. The resulting savings for both 
the industry and the FAA from reducing the number of waivers range from 
a low estimate of approximately $8.3 million to a high estimate of 
$16.7 million ($5.8 million and $11.7 million present value at a 7% 
discount rate, respectively).

II. Background

    An operator conducts a launch using an expendable launch vehicle 
(ELV) or a reusable launch vehicle (RLV). An ELV is a launch vehicle 
whose

[[Page 47018]]

propulsive stages are flown only once. 14 CFR 401.5. An RLV is a launch 
vehicle that is designed to return to Earth substantially intact and, 
therefore, may be launched more than one time or that contains vehicle 
stages that may be recovered by a launch operator for future use in the 
operation of a substantially similar launch vehicle. Id. Reentry is 
conducted with RLVs or other reentry vehicles. A reentry vehicle is a 
vehicle designed to return from Earth orbit or outer space to Earth 
substantially intact, and includes a reentering RLV. Id.
    Parts 417, 420, 431, and 435 (collectively, the collective risk 
regulations) limit the collective risk that a commercial launch or 
reentry may pose to the public. The FAA's collective risk regulations, 
as originally promulgated, were based primarily on Ec limits 
that the U.S. Air Force imposed on launches from federal launch ranges 
at the time the FAA began establishing its own Ec limits.\1\ 
In addition to imposing Ec limits on risk posed by launches 
and reentries to collective members of the public, these regulations 
also impose separate limits on the risk posed by these operations to 
individual members of the public.
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    \1\ See, e.g., Commercial Space Transportation Licensing 
Regulations, Final Rule (Launch Licensing Rule), 64 FR 19586, 19605 
n.11 (Apr. 21, 1999).
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    In July 2014, the FAA published in the Federal Register a notice of 
proposed rulemaking (2014 NPRM) proposing various revisions to the 
FAA's launch and reentry regulations.\2\ This final rule adopts the 
proposal outlined in the 2014 NPRM, with minor modifications and 
clarifications in response to comments from the public.
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    \2\ Changing the Collective Risk Limits for Launches and 
Reentries and Clarifying the Risk Limit Used to Establish Hazard 
Areas for Ships and Aircraft, 79 FR 42241 (July 21, 2014).
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A. Statement of the Problem

    Prior to the 2014 NPRM, developments in the industry and among U.S. 
Government agencies led the FAA to question its collective risk 
regulations. In 2010, the U.S. Air Force, after conducting over 5,000 
launches under a 30 x 10-6 Ec limit, determined 
that it could increase its Ec limit from 30 x 
10-6 per hazard to 100 x 10-6 for the aggregate 
public risk associated with debris, toxicity, and far field blast 
overpressure without harming public safety. The U.S. Air Force's new 
Ec standards also apply a separate Ec limit to 
reentry, limiting reentry Ec to 100 x 10-6 for 
the aggregate public risk associated with all hazards, which typically 
include debris, toxicity, and far field blast overpressure. In 
addition, in 2010 NASA also revised its risk acceptability policy to 
limit the Ec from launch and reentry missions to 100 x 
10-6 each.
    Because the FAA's collective risk regulations were based on the 
U.S. Air Force's former 30 x 10-6 limit--a limit that both 
the U.S. Air Force and NASA, after considerable experience, have now 
revised--the FAA questioned in the 2014 NPRM whether its collective 
risk limits, revised by this final rule, continued to represent 
appropriate public risk criteria for commercial ELV and RLV operations. 
In addition, the FAA's own experience led the agency to question 
whether those Ec limits created an obstacle to NASA's 
implementation of the National Space Policy (e.g., NASA proposed 
commercial flights to the International Space Station that would not 
meet FAA's current Ec limits).\3\
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    \3\ See National Space Policy of the United States of America 
(June 28, 2010), available at https://www.whitehouse.gov/sites/default/files/national_space_policy_6-28-10.pdf.
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    Finally, the FAA also sought to address in the 2014 NPRM whether 
its former collective risk regulations sufficiently distinguished 
between commercial launch and reentry risk. Instead of regulating risk 
based on whether the operation in question was a launch or a reentry, 
the former collective risk regulations focused on the type of vehicle 
used in the operation, namely whether the vehicle was an ELV, RLV, or a 
reentry vehicle.

B. Summary of the 2014 NPRM

    The 2014 NPRM proposed several revisions to the FAA's risk 
framework. These proposals included: Aggregating launch hazards and 
establishing an Ec limit of 1 x 10-4, thus 
reducing the number of significant digits in a launch or reentry risk 
analysis; separating the risk limits for the launch and reentry of a 
reentry vehicle; including toxic release as a hazard in the risk 
analysis for reentries; and clarifying the acceptable risk threshold 
for impact with ships and aircraft in hazard areas. For more detailed 
information, interested parties may consult the preamble of the 2014 
NPRM.

C. General Overview of Comments

    The comment period for the July 2014 NPRM closed on October 20, 
2014. The FAA received comments from nine commenters, including ACTA 
Inc. (ACTA), Blue Origin, LLC (Blue Origin), Lockheed Martin 
Corporation (Lockheed Martin), Orbital Sciences Corporation (Orbital 
Sciences), Sierra Nevada Corp. (Sierra Nevada), Space Exploration 
Technologies Corp. (SpaceX), XCOR Aerospace (XCOR), and two individual 
commenters. Most of the commenters supported the proposed changes, and 
some suggested additional changes that are discussed more fully below. 
Several commenters fully supported the proposed changes, and one 
commenter opposed the proposed changes. The comments focused on the 
following general areas of the proposal:

 Individual risk limits
 Separation of launch and reentry
 Significant figures
 Ship and aircraft hazard areas
 Including toxic release in the reentry risk analysis

III. Discussion of Public Comments and Final Rule

A. Individual Risk

    As discussed in the 2014 NPRM, this final rule does not 
substantively revise the FAA's limitation on risk posed to individuals 
found in Sec. Sec.  417.107, 431.35, and 435.35.\4\ The individual risk 
limits in Sec.  417.107(b)(2) prohibit launch risk to an individual 
from exceeding 1 x 10-6 for each hazard (debris, toxic 
release, and far field blast overpressure) for launch of an ELV. For 
the launch of a RLV or other reentry vehicle, Sec. Sec.  
431.35(b)(1)(ii) and 435.35 continue to prohibit the risk to an 
individual from exceeding 1 x 10-6 per mission. The FAA 
proposed no change to this risk limit, so any change now would be 
outside the scope of the proposal. Nonetheless, the comments raise 
issues of interest and are addressed below.
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    \4\ However, it should be noted that the FAA made a non-
substantive change to 417.107(b)(2) to improve consistency and 
clarity.
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    XCOR agreed that no change is necessary because it is easier for 
launch operators to mitigate risk to a particular individual than the 
collective public, and because the FAA has never waived individual risk 
for launches in the past. On the other hand, Orbital Sciences 
recommended that the FAA ``[e]xamine historical data for all U.S. 
launches to determine the highest level of risk realized by any 
individual member of the public and propose a more realistic . . . risk 
[figure] based on this successful precedent.'' Orbital Sciences also 
recommended that the FAA adopt ``identical risk limits for individual 
members of the public'' for U.S. Government and commercial launches.
    The FAA disagrees with Orbital Sciences' recommendation to revise 
the individual risk threshold. Unlike the FAA's collective risk 
limitation, the FAA is aware of only a small number of historical U.S. 
government launches for which the predicted individual risk for any one 
member of the public exceeded

[[Page 47019]]

1 x 10-6. From a statistical perspective, this casualty-free 
launch record is the expected outcome because 1 x 10-6 
corresponds to a one-in-a-million chance of a particular person being a 
casualty and there have been no more than a few thousand launches from 
the United States. The FAA therefore finds insufficient evidence at 
this time to justify relaxing the current individual risk limits, which 
are an integral part of an interdependent set of safety requirements 
that have produced a flawless public safety record for U.S. launches 
and reentries. Furthermore, the FAA notes that limiting risk to 
individual members of the public at the 1 x 10-6 level is 
consistent with the consensus standard produced by U.S. range safety 
organizations as adopted by NASA and the U.S. Air Force.
    ACTA stated that maintaining the current individual risk thresholds 
perpetuates inconsistent individual risk standards for ELVs, RLVs, and 
reentry vehicles. ACTA observed that Sec.  417.107(b)(1)(ii) limits 
individual risk to 1 x 10-6 for each hazard for ELVs. ACTA 
stated that this was inconsistent with the risk threshold for RLVs and 
reentry vehicles in Sec.  431.35(b)(2)(ii), which limits total risk to 
an individual to 1 x 10-6 over the course of the entire 
mission, without any reference to specific hazards. As a result, ACTA 
argued, ELV missions would have a different individual risk criterion 
than missions involving an RLV or other reentry vehicle.
    ACTA's recommendation to harmonize all individual risk limits is 
outside the scope of the current rulemaking. Also, the FAA has 
insufficient data to justify a change to the individual risk criteria 
for either launch or reentry, and thus no change was proposed. Finally, 
the current regulatory framework governing individual risk for launch 
and reentry risk has successfully protected the public since 2000.

B. Separating Ec for Launch and Reentry

    The FAA proposed to separate the Ec limits for the 
launch and reentry of all reentry vehicles, instead of applying a 
single risk limit to both phases of a mission.\5\
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    \5\ The separation of Ec limits for launch and 
reentry affects Sec. Sec.  431.35(b) and 435.35.
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    Blue Origin, Lockheed Martin, Orbital Sciences, and SpaceX fully 
supported the proposal to separate launch and reentry risk. ACTA 
supported the proposal to separately assess launch and reentry risk if 
reentry occurs after a health check, but noted that ``separation of 
risk budgets for launch and reentry ignores the risk contribution from 
a failure to initiate a planned reentry.'' In particular, ACTA noted 
that ``[t]here does not appear to be any consideration for consequences 
if the health check prior to reentry fails. . . . [The vehicle's] orbit 
will eventually degrade and re-enter . . . [and the] risk of this 
potentially uncontrolled re-entry (if the health of the vehicle can 
never be restored) appears to be neglected.''
    ACTA is correct that the FAA does not regulate the risk associated 
with reentry vehicles or parts of reentry vehicles that do not initiate 
or attempt to initiate a purposeful reentry. As the FAA has explained, 
the Act limits the FAA's licensing of reentry to scenarios involving 
purposeful reentry; \6\ therefore, the FAA is prohibited from 
considering the ``possibility of a random uncontrolled reentry that 
occurs as a result of a reentry vehicle ceasing to function upon 
arrival in orbit.'' \7\
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    \6\ Waiver of Acceptable Mission Risk Restriction for Reentry 
and a Reentry Vehicle, 75 FR 75619, 75620 (Dec. 6, 2010).
    \7\ The Waiver explained that ``[b]ecause a random uncontrolled 
reentry arising out of a reentry vehicle ceasing to function upon 
arrival in orbit is not purposeful and is thus not licensed, an 
interpretation that section 431.35 applies to this type of reentry 
would conflict with'' limitations on the FAA's authority.
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    Although the 2014 NPRM did not propose to change the requirement 
that suborbital launches and reentries be subject to a single launch 
Ec, the FAA invited comment on the issue. Sierra Nevada 
commented that suborbital flights also should have separate risk limits 
for launch and reentry because each phase of flight required 
independent operational decisions.
    XCOR, on the other hand, commented that suborbital vehicles should 
continue to have a single risk limit because, for a suborbital launch, 
``reentry is a physical inevitab[ility]''; there is ``no intervening 
event between launch and reentry''; and that ``reentry is closely 
proximate in time--four minutes, for most concepts to launch.''
    The FAA agrees with XCOR that a suborbital mission should continue 
to be analyzed using a single risk budget for the entire mission, from 
launch through final impact, because there is no intervening event 
between launch and reentry and because reentry is a physical 
inevitability. Moreover, separating launch and reentry risk limits for 
suborbital flights is beyond the scope of this final rule because it 
would require revising the definitions of ``reentry'' and ``launch'' 
found in Sec.  401.5, changes the NPRM did not propose.
    The FAA will require separate analysis of the risks associated with 
launch and reentry because the two are separate events. A launch may 
not always be successful, and a single risk limit that encompasses both 
launch and reentry makes reentry risk calculations unnecessarily 
dependent on the probability of failure associated with launch. The FAA 
leaves unchanged, however, the requirement that suborbital launches and 
reentries must comply with a single launch Ec limit that 
encompasses the entire operation from launch through final impact.

C. Revising the Acceptable Risk Standard

    The FAA proposed to revise the acceptable risk limit for launch to 
1 x 10-4, encompassing all three hazards--debris, toxic 
release, and far field blast overpressure. This would amend the risk 
framework's three components by aggregating the analysis of debris, 
toxics, and far field blast overpressure; establishing a new, unified 
risk standard for the three primary hazards combined; and revising the 
risk standard to be expressed using one significant figure. The 
commenters addressed each of these issues separately.
1. Aggregating Ec for Debris, Toxics, and Far Field Blast 
Overpressure
    ACTA, Orbital Sciences, and SpaceX supported the proposal to 
aggregate risk calculations. The FAA received no negative comments on 
this component of the proposal. Therefore, this final rule replaces the 
prior requirement to satisfy three separate Ec criteria (one 
each for debris, toxics, and far field blast overpressure) with a 
single Ec criterion accounting for all three primary 
hazards.
2. Revising the Number of Significant Figures
    Numerous commenters, including Blue Origin, Lockheed Martin, 
Orbital Sciences, and SpaceX, supported the FAA's proposal to express 
the risk threshold using one significant figure. Lockheed Martin stated 
that the proposal ``would improve efficiency and maintain a level of 
safety for commercial launches that is commensurate with the current 
high level of safety associated with civil and military launches.''
    ACTA and an individual commenter advocated against changing the 
number of significant figures. An individual commenter recommended that 
one significant figure would be more appropriate at the level of 1 x 
10-5. ACTA agreed with the proposal to increase the risk 
limitations insofar as ``it is reasonable to apply a higher 
acceptability limit (around 100 x

[[Page 47020]]

10-6),'' but also stated the FAA's proposal to both raise 
the limit and reduce the number of significant figures resulted in an 
effective increase of ``the acceptable risk limit to 50% above current 
Air Force and NASA practice.'' Referring to the effects of revising the 
number of significant figures, ACTA stated that ``the difference 
between 100 x 10-6 and 149 x 10-6 is real and 
significant.'' ACTA also stated that, because of this ``effective'' 50% 
increase, the FAA's proposal would not maintain safety levels for 
commercial space transportation commensurate with the current 
requirements for civil and military reentries. Finally, ACTA also 
disagreed with the FAA's rationale for increasing the acceptable risk 
limit. In particular, ACTA stated that it is inappropriate to exceed 
the Range Commanders Council (RCC) 321 consensus standard; the success 
of a relatively small number of missions operated under waivers is 
statistically irrelevant; and the continued use of waivers is 
reasonable in a developing industry.
    The FAA disagrees that the difference between 100 x 10-6 
and 149 x 10-6 is real and significant because the 
uncertainty associated with many of the variables that go into 
determining Ec are too large to justify using more than one 
significant digit. The FAA and others, including ACTA, have performed 
extensive uncertainty analyses for both launch area and downrange 
overflight. These analyses accounted for aleatory-- irreducible--and 
epistemic--modeling--sources of uncertainty, including the inherent 
variability in the impact distribution due to wind and lift effects for 
irregular debris following failure; probability of failure; casualty 
area for people in shelters that are impacted by debris; size of the 
debris impact probability distribution; yield from exploding propellant 
and propellant tanks; probability of injury from a blast wave for 
people in buildings or unsheltered; and population density. Uncertainty 
also exists in the Ec estimate for overflight because of the 
uncertainty in the time of launch,cargo debris, and different methods 
to characterize the normal trajectory dispersions based on input data 
provided by the launch operator.
    A standard public risk analysis for launch or reentry produces a 
single Ec value, but these state-of-the-art analyses 
demonstrate that the modeling uncertainties are too large to justify 
calculating Ec to more than one significant figure.\8\ In 
fact, the uncertainty in a vehicle's probability of failure alone is 
generally large enough to render meaningless any calculated differences 
involving more than one significant digit, such as a calculated 
difference of 100 x 10-6 compared to 149 x 10-6 
in Ec estimates for a commercial launch.\9\ Specifically, 
during SpaceX's third Falcon 9 mission (F9-003), two probability of 
failure analysis approaches applied by the two major federal ranges for 
commercial launches, which the FAA deemed equally valid based on the 
requirements in Sec.  417.224, produced mean probability of failure 
estimates during Eurasian over-flight that varied by approximately 40 
percent. Also, the uncertainty in the Ec estimate scales 
linearly with the statistical uncertainty associated with any 
probability of failure analysis method, even when the assumptions of 
the model are absolutely true. For example, applying the binomial 
approach in part 417, appendix A, Sec.  417.25(b)(5)(iii), to a new 
vehicle with a record of no failures in the first two flights produces 
a reference probability of failure estimate of 0.28. Even if the 
assumption of Bernoulli trials \10\ inherent in the binomial approach 
is absolutely true, which is doubtful given the evolutionary nature of 
expendable launch vehicles, particularly during the first several 
flights, there is about a 20 percent chance that the true probability 
of failure is at least twice the reference probability of failure 
estimate. It is impossible to know the true probability of failure for 
any launch vehicle flight. The FAA believes that the uncertainty in the 
probability of failure alone always renders meaningless any more than 
one significant digit in any commercial launch or re-entry 
Ec estimate.
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    \8\ In fact, an uncertainty analysis produces a set of point 
estimates, each of which is an equally valid result, to quantify the 
uncertainty in the Ec estimate. ACTA itself developed a 
tool that computes the uncertainty in the point estimate of 
Ec by using multiple input data sets within the range of 
feasibility given the uncertainty associated with the input data, 
together with a multiple sets of factors applied to each sub-model 
to account for the estimated biases and uncertainties in the 
applicable sub-models.
    \9\ Of course, the probability of failure uncertainty is very 
large for relatively new vehicles, which are most likely to have 
risk estimates near the 1 x 10-4 Ec limit. 
However, even vehicles with extensive flight history, such as the 
Delta II, have probability of failure estimates that vary by a 
factor of two or more based on the analysis approaches applied by 
the two major federal ranges where commercial launches most often 
occur. For example, the Delta II demonstrated nine failures in 227 
launches in advance of the GRAIL mission. Valid probability of 
failure analysis methods produced mean estimates of probability of 
failure for the GRAIL launch between less than 2% to more than 4%, 
depending on whether and how reliability growth was accounted for.
    \10\ All expendable launch vehicle failure probability analysis 
methods used by Federal ranges today assume that launches may be 
treated as Bernoulli trials: That the vehicle has a constant ``true 
probability'' of failure for each and every launch, and that the 
outcome of each launch is statistically independent of all others. A 
toss of an evenly weighted coin is a classic example of a Bernoulli 
trial. Of course, launches are not exactly Bernoulli trials because 
no two launches are precisely the same. For example, the vehicle may 
be modified or improved as needed during a sequence of launches, 
particularly if it has failed on previous launches, and there are 
natural variations due to environmental conditions during the 
vehicle manufacturing, processing, and launch.
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    ACTA provided three alternatives to the FAA's July 2014 proposal. 
These alternatives included (1) using ``the approach specified in RCC 
321-10'' in which increasing degrees of analysis and mitigation are 
required as the risk increases above 30 x 10-6 and again at 
100 x 10-6; (2) ``[e]xpress[ing] the limit that 
log10(EC) is less than -4.0 (to two significant figures''; 
and (3) ``[a]pply[ing] a limit of 9 x 10-5 rather than 1 x 
10-4 which results in an effective limit of 95 x 
10-6.''
    The FAA appreciates the potential value in using the RCC 321-10 
approach, in which increasing degrees of analysis and mitigation are 
required as the risk increases. Such a dramatic change, however, is 
beyond the scope of this rulemaking. The FAA disagrees with ACTA's 
recommendations to ``[e]xpress the limit that log10(EC) is 
less than -4.0 (to two significant figures'' or ``[a]pply[ing] a limit 
of 9 x 10-5 rather than 1 x 10-4 which results in 
an effective limit of 95 x 10-6'' because either of those 
approaches would still imply more significant digits in the 
Ec estimate than justified based on the Ec 
uncertainty analyses summarized above.
3. Establishing an Acceptable Risk Limit of 1 x 10-4
    Under the 2014 NPRM, Sec. Sec.  417.107(b)(1), 431.35(b)(1)(i), and 
435.35(b) would establish an acceptable collective risk limit of 1 x 
10-4. Two commenters, Lockheed Martin and SpaceX, supported 
the proposal without additional significant comment. SpaceX noted that 
the proposal would align the FAA's risk limit with the standards set by 
other organizations within the U.S. Government.
    Orbital Sciences supported the proposal but also recommended that 
the FAA ``[e]xamine historical data for all U.S. launches and determine 
the highest level of collective risk realized by the public [to] 
propose a more realistic . . . collective risk [number] based on this 
successful precedent.'' Similarly, Blue Origin recommended that the 
collective risk number be revised higher than proposed, to 1 x 
10-3. Blue Origin noted that Federal ranges have, in the 
past, waived risks associated with non-commercial reentry to as high as 
1 x 10-3, and stated, ``[t]he commercial

[[Page 47021]]

spaceflight industry should be held to the standard that the nation's 
civil and military programs are held to in practice.'' \11\ Blue Origin 
suggested that reducing the need for waivers would increase 
transparency and ``more closely reflect FAA's regulatory practice, 
rather than relying on a waiver process such as practiced by NASA and'' 
the U.S. Air Force. Blue Origin further stated that, if the FAA adopts 
``a risk level that differs from [the FAA's] actual practice, the 
commercial spaceflight industry will be left not knowing what the real, 
actual risk level will be in practice,'' suggesting that reducing the 
agency's reliance on waivers would provide an important measure of 
stability and predictability to the commercial space industry.
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    \11\ Emphasis in original.
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    The FAA disagrees with Orbital Sciences' and Blue Origin's 
recommendations to increase the Ec limit beyond 1 x 
10-4. The United States has achieved a flawless public 
safety record for orbital launch and re-entry missions in part because 
of a comprehensive and interdependent set of public safety requirements 
developed and implemented by numerous, cooperating entities within the 
U.S. government. Three U.S. government entities, the U.S. Air Force, 
NASA, and the FAA, have oversight of the safety of launches. Both the 
U.S. Air Force and NASA, working alone and collaborating through 
organizations such as the RCC and the Common Standards Working Group, 
have examined the available data and determined that 100 x 
10-6, also expressed as 1 x 10-4, is an 
appropriate standard for acceptable risk.\12\ There are an insufficient 
number of casualty-free launches and reentries with Ec 
greater than 1 x 10-4 to justify departing from the standard 
adopted by the U.S. Air Force and NASA. In the few cases where waivers 
were granted by the FAA, prior to and including 2014, the respective 
Ec was always less than the risk levels previously approved 
for government launches. Hence, any precedent for granting waivers for 
prior non-commercial reentries is not sufficient justification for 
implementing a more lenient risk limit, especially in light of the 
increased scrutiny given to each waiver applicant.
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    \12\ See Range Commanders Council Risk Committee of the Range 
Safety Group, Common Risk Criteria for National Test Ranges, RCC 
321-10, White Sands Missile Range, New Mexico, 2010.
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    Moreover, a fundamental tenent of risk management, both as applied 
to the regulation and general safety management of various industries, 
is to set acceptability criteria for collective risk that are below the 
level that may be acceptable in unusual circumstances or on a short 
term basis. For aviation risk management, the FAA has identified risk-
informed Continued Airworthiness Assessment Methodologies (CAAM) that 
include short term acceptable risks that are orders of magnitude 
greater than long term acceptable risk levels.\13\ Thus, AC 39-8 is 
another example of the FAA adopting a risk management approach where 
basic acceptability criteria are more stringent than may be acceptable 
in unusual circumstances or on a short term basis. Note that the FAA's 
use of quantitative risk analysis results is consistent with the risk-
informed approach to regulatory decision-making adopted by the Nuclear 
Regulatory Commission (NRC). In 1999, the NRC wrote that ``a `risk-
informed' approach to regulatory decision-making represents a 
philosophy whereby risk insights are considered together with other 
factors to establish requirements that better focus licensee and 
regulatory attention on design and operational issues commensurate with 
their importance to public health and safety.'' \14\
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    \13\ Federal Aviation Administration, Advisory Circular No. 39-
8, Continued Airworthiness Assessments of Powerplants and Auxiliary 
Power Unit Installations of Transport Category Planes, Washington, 
DC, September 2003.
    \14\ U.S. Nuclear Regulatory Commission, Commission Issuance of 
White Paper on Risk-informed and Performance-based Regulation, 
Yellow Announcement # 019, Washington, DC, dated March 11, 1999.
---------------------------------------------------------------------------

    In light of these considerations and all currently available data, 
the FAA finds that a collective Ec limit of 1 x 
10-4 reflects an appropriate consensus safety risk standard 
for launch and re-entry. Consistent with Executive Orders 13563 and 
13610, the FAA plans to periodically review and revise this public risk 
standard, if warranted, based upon factors such as the quantity of 
launch and reentry activities, demonstrated reliability and safety 
record and benefits provided, technological capabilities, and maturity 
of the industry.
    ACTA and an individual commenter cautioned against justifying any 
increase to the acceptable risk standards by reference to either a 
relatively small number of successful launches or the uncertainty of 
launch risk calculations. The individual commenter recommended that any 
increase to the acceptable risk limits be premised on a determination 
that higher numbers still adequately ensure public safety.
    The FAA disagrees with ACTA's and the individual commenter's 
premise concerning the basis of this final rule. Contrary to their 
assertion, the FAA is not relying on the historical success of a 
relatively small number of past launches as a justification for 
increasing the acceptable risk standard. Rather, the FAA, by statute, 
is authorized to regulate ``only the extent necessary'' to protect 
public health and safety. 51 U.S.C. 50901(a)(7). The U.S. Air Force and 
NASA, two federal agencies with significant expertise in this area, 
have both examined the currently available data and concluded that it 
does not justify an aggregated Ec limit lower than 100 x 
10-6. Furthermore, there are published materials that 
explain the rationale for the collective risk limit adopted both by the 
U.S. Air Force and NASA.15 16 17 The currently available 
data does not justify a regulatory restriction on Ec for 
commercial licensees that is more stringent than the standards adopted 
both by the U.S. Air Force and NASA.
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    \15\ See Range Commanders Council Risk Committee of the Range 
Safety Group, Common Risk Criteria for National Test Ranges, RCC 
321-10, White Sands Missile Range, New Mexico, 2010.
    \16\ Wilde P., Public Risk Criteria and Rationale for Commercial 
Launch and Reentry, 5th IAASS Symposium, Versailles, France, October 
2011.
    \17\ Wilde, P. Public Risk Tolerability Criteria for Space 
Launch and Reentry, Presented at the 51st Scientific and Technical 
Subcommittee of the United Nations Committee on the Peaceful Uses of 
Outer Space, Vienna, Austria, 18 Feb. 2014.
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D. Clarifying Hazard Areas for Ships and Aircraft

    Prior to this final rule, Sec.  417.107(b)(3) and (4) required the 
launch operator of an ELV to implement and establish ship and aircraft 
hazard areas providing an equivalent level of safety to that provided 
by the ship and aircraft hazard areas implemented for launch from a 
Federal launch range. 71 FR 50508. The FAA proposed to amend Sec.  
417.107(b)(3) and (4) to clarify the requirements for hazard areas for 
ships and aircraft, respectively, by removing references to an 
``equivalent level of safety to that provided by [ship or aircraft] 
hazard areas implemented for launch from a Federal range'' and 
replacing them with a numeric limit on the probability of impact with 
debris capable of causing a casualty.
    Orbital Sciences recommended that no change be made to the hazard 
area regulations. Orbital Sciences stated that the proposal to 
implement a specific risk standard, even if it is quantitatively the 
same as the Federal launch ranges' standard, creates the possibility 
that the Federal launch ranges will change their standard and the FAA's 
regulation will become obsolete. The FAA disagrees with Orbital 
Sciences' recommendation. Regardless of whether the Federal

[[Page 47022]]

launch ranges change their risk criteria for ships and aircraft, the 
Administrative Procedure Act, with limited exceptions, prohibits the 
FAA from changing its regulatory requirements without notice and 
comment. 5 U.S.C. 553. Therefore, even if the FAA maintained these 
provisions using a purportedly outdated standard, a change to the 
Federal launch range requirements would not automatically flow through 
to FAA regulations, and licensed launch operators would have to abide 
by the Federal launch range standard in effect when the FAA first 
promulgated the regulation. Accordingly, if the Federal launch ranges 
change their standard, the FAA will have to initiate its own rulemaking 
in order to harmonize its water-borne vessel and aircraft hazard areas 
limits with the Federal launch ranges'. To prevent this confusion, the 
FAA is revising Sec.  417.107(b)(3) and (4) to identify the numeric 
requirements.
    An individual commenter questioned the proposed clarifications 
regarding the ship and aircraft hazard areas. Specifically, the 
individual commenter pointed out that the proposal, which is based on 
the probability of impact with debris capable of causing a casualty, 
could be either excessively conservative or non-conservative depending 
on the details of the analysis, such as the threshold characteristics 
of the debris and the size of the area considered vulnerable to such 
debris impact. ACTA provided similar comments, stating the regulations 
(1) do ``not define the area for computing impact'' with a vessel or 
aircraft, and (2) do not clarify that operators must account for ``the 
near-field explosive effects of propellants impacting in the vicinity 
of [a] ship.''
    The individual commenter's recommendation to substantively amend 
the hazard area risk standards is outside the scope of this rulemaking. 
As described in the 2014 NPRM, this final rule does not substantively 
change the hazard area risk standards. 79 FR 42241, 42249-50. The 
hazard area revisions only clarify the FAA's standards by using a 
specific number, rather than an unquantified reference to Federal 
launch range standards. The FAA therefore rejects the commenter's 
recommendations to make substantive changes to the rule.
    ACTA's comments also included numerous additional observations 
related to the hazard area regulations. ACTA stated that the 
regulations do not ``specify how (or even if) hazard areas are to be 
used to implement mitigation'' to protect specific individuals or the 
general public. This observation, however, ignores other sections of 
the regulations that do address how hazard areas are to be used to 
implement mitigation techniques, such as issuing public warnings and 
performing surveillance. To meet the public risk criteria of Sec.  
417.111(b), Sec.  417.223 requires ``a flight hazard area analysis that 
identifies any regions of land, sea, or air that must be surveyed, 
publicized, controlled, or evacuated in order to control the risk to 
the public from debris impact hazards.'' Furthermore, Sec.  417.111(j) 
requires a launch operator to ``implement a plan that defines the 
process for ensuring that any unauthorized persons, ships, trains, 
aircraft or other vehicles are not within any hazard areas identified 
by the flight safety analysis or the ground safety analysis,'' and 
explicitly includes hazard areas identified under Sec. Sec.  417.107 
and 417.223.
    ACTA also criticized the proposal for failing to justify ``why the 
acceptable risk limit to the general public on ships is higher than for 
people on land.'' The premise of this comment is not correct. 
Specifically, Sec.  417.107(b)(2) provides that a launch operator may 
initiate flight only if the risk to any individual member of the public 
does not exceed a 1 x 10-6 probability of casualty, 
regardless of the location of that individual member of the public. 
Thus, the FAA's risk criteria provide equal protection to each 
individual member of the public, on ships or on land. Moreover, to the 
extent ACTA is criticizing the water-borne vessel hazard areas 
requirement, the FAA is not changing the water-borne vessel hazard area 
requirement; it is merely clarifying the requirement by removing a 
reference to where the requirement can be found and replacing it with 
the actual requirement.
    ACTA also was concerned that the criteria for ship and aircraft do 
not explicitly exclude ``mission-support vessels and aircraft,'' 
creating an inconsistency with the remainder of the regulation. 
Although ACTA is correct that the criteria do not apply to vessels and 
aircraft that support the launch, the FAA's launch and reentry 
regulations address only public safety, which Sec.  401.5 defines as 
``for a particular licensed launch, the safety of people and property 
that are not involved in supporting the launch . . .'' It, therefore, 
is unnecessary to explicitly exclude ``mission-support vessels and 
aircraft'' from the public safety criteria for launch.
    Finally, ACTA recommended that Sec.  417.107(b)(3) and (4) state 
that ``a launch operator must make reasonable effort to ensure that the 
probability of casualty to members of the public on water borne vessels 
or in aircraft does not exceed the limit specified in [Sec.  
417.107(b)(2)].'' ACTA stated that this revision would establish a 
``specific risk value'' while at the same time giving operators 
flexibility as to ``the method of protection'' or risk mitigation. The 
regulations already allow a launch operator to employ different methods 
of mitigating risk so the FAA will not adopt ACTA's proposal.

E. Including Toxic Release in the Reentry Risk Analysis

    The FAA proposed to include the risks associated with toxic release 
in the Ec limitations for the reentry of an RLV or other 
reentry vehicle. Blue Origin opposed the proposal to include toxic 
release in the reentry risk calculation. Blue Origin, quoting from the 
regulatory evaluation in the 2014 NPRM, stated that ``toxic release 
risks for reentry vehicles are `expected to remain a minor factor in 
Ec calculations,' because most of the propellant will have 
been used during the mission . . .'' The FAA is revising its position, 
and disagrees with Blue Origin's assertion, because the FAA is aware of 
plans that involve the return to land with a significant hypergolic, 
highly toxic, propellant load carried until touchdown. The FAA 
therefore continues to include toxic release in the reentry risk 
analysis at this time.

F. Miscellaneous

    Sierra Nevada recommended that the FAA define orbital insertion to 
help ``reduce misinterpretation of the regulations'' because 
``[s]etting a specific boundary would allow commercial space companies 
to clearly understand the boundaries for expected casualty limits.''
    The FAA agrees with Sierra Nevada's comments that Sec.  
417.107(b)(1) can be amended to prevent potential 
misinterpretation.\18\ The FAA takes this opportunity to clarify that 
risk associated with planned impacts after orbital insertion should not 
be included in an Ec analysis governed by Sec.  417.107. 
Accordingly, to minimize confusion, the FAA is removing the phrase 
``including each planned impact'' from Sec.  417.107(b)(1) to state 
only that the operator account for risk through orbital insertion. The 
risk assessment conducted under Sec.  417.107(b)(1) must

[[Page 47023]]

only include impacts through--meaning up to and including--the moment 
of orbital insertion. More specifically, Ec encompasses 
risks associated with planned events occurring from launch through the 
moment of orbital insertion, but not the risks associated with on-orbit 
activities. For example, the Sec.  417.107 risk analysis must include 
the planned impact of a first stage jettisoned prior to orbital 
insertion regardless of whether the actual impact of the first stage 
occurs before or after orbital insertion.\19\ This is true whether the 
first stage makes a controlled or uncontrolled impact. In contrast, the 
Sec.  417.107 risk analysis does not require accounting for the planned 
impact of an upper stage jettisoned after the vehicle has achieved 
orbital insertion.
---------------------------------------------------------------------------

    \18\ The FAA notes that its 2014 waiver for the Orion 
Exploration Test Flight 1, which authorized an Ec of up 
to 218 x 10-6, improperly accounted for public risks 
outside the scope of Sec.  417.107(b)(1) by considering public risk 
associated with planned impacts after orbital insertion in the 
Ec calculation. Notice of Waiver, Mar. 10, 2014 (79 FR 
13375); Notice of Amended Waiver, Dec. 5, 2014, (79 FR 72240).
    \19\ For example, the return to Earth and successful landing of 
the first stage of SpaceX's Falcon 9 launch vehicle was considered 
part of launch and was accounted for in the calculation of launch 
risk.
---------------------------------------------------------------------------

    An individual commenter observed that the 2014 NPRM proposed to 
revise the Ec requirements in parts 417, 431, and 435, but 
neglected to revise the corresponding Ec requirements in 
part 420, License to Operate a Launch Site. This was an oversight. This 
final rule revises Sec. Sec.  420.19(a)(1); 420.23(a)(2), (b)(3), and 
(c)(1)(ii); 420.25(b); 431.43(d)(2); paragraph (d) of Appendix C to 
part 420; and paragraphs (a)(5), (e)(2), and (e)(3) of Appendix D to 
part 420 to account for the Ec revisions made throughout 
chapter III of title 14 of the Code of Federal Regulations.
    Previously, Sec.  417.107(b)(2) referenced Ec when 
describing the risk limit to any individual member of the public. This 
reference may cause confusion because Ec is a measure of 
collective risk to public safety, not individual risk. To prevent any 
potential confusion, this final rule makes a non-substantive change to 
Sec.  417.107(b)(2) to remove the reference to Ec.
    The FAA is streamlining the terminology in the collective risk 
requirements. Specifically, we are removing the colloquial term 
``average'' from ``expected average,'' which is redundant and 
unnecessary. In statistics there are three measures of central tendency 
or ``averages'': The median, mode, and mean. The expected value is 
synonymous with the mean value specifically, thus the term ``expected'' 
is technically precise and sufficient.

G. Differences Between the 2014 NPRM and the Final Rule

    As described above, there are two differences between the FAA's 
proposal in the 2014 NPRM and this final rule as adopted. These changes 
include: (1) removing the phrase ``including each planned impact'' from 
Sec.  417.107(b)(1) and (2) revising part 420 to account for revisions 
to the Ec standard in parts 417, 431, and 435.

IV. Regulatory Notices and Analyses

A. Regulatory Evaluation

    Changes to Federal regulations must undergo several economic 
analyses. First, Executive Order 12866 and Executive Order 13563 direct 
that each Federal agency shall propose or adopt a regulation only upon 
a reasoned determination that the benefits of the intended regulation 
justify its costs. Second, the Regulatory Flexibility Act of 1980 (Pub. 
L. 96-354) requires agencies to analyze the economic impact of 
regulatory changes on small entities. Third, the Trade Agreements Act 
(Pub. L. 96-39) prohibits agencies from setting standards that create 
unnecessary obstacles to the foreign commerce of the United States. In 
developing U.S. standards, the Trade Act requires agencies to consider 
international standards and, where appropriate, that they be the basis 
of U.S. standards. Fourth, the Unfunded Mandates Reform Act of 1995 
(Pub. L. 104-4) requires agencies to prepare a written assessment of 
the costs, benefits, and other effects of final rules that include a 
Federal mandate likely to result in the expenditure by State, local, or 
tribal governments, in the aggregate, or by the private sector, of $100 
million or more annually (adjusted for inflation with base year of 
1995). This portion of the preamble summarizes the FAA's analysis of 
the economic impacts of this final rule.
    In conducting these analyses, the FAA has determined that this 
final rule: (1) Has net benefits that justify the costs; (2) is not an 
economically ``significant regulatory action'' as defined in section 
3(f) of Executive Order 12866; (3) is not ``significant'' as defined in 
DOT's Regulatory Policies and Procedures; (4) will not have a 
significant economic impact on a substantial number of small entities; 
(5) will not create unnecessary obstacles to the foreign commerce of 
the United States; and (6) will not impose an unfunded mandate on 
state, local, or tribal governments, or other private sectors by 
exceeding the threshold identified above.
    Department of Transportation Order DOT 2100.5 prescribes policies 
and procedures for simplification, analysis, and review of regulations. 
If the expected cost impact is so minimal that a final rule does not 
warrant a full evaluation, this order permits that a statement to that 
effect and the basis for it to be included in the preamble if a full 
regulatory evaluation of the cost and benefits is not prepared. Such a 
determination has been made for this final rule. Based on the facts and 
methodology explained for the NPRM, the FAA provided cost-savings 
estimates for the proposed rule and requested comments. The FAA did not 
receive any comments on the estimates and thus the FAA follows the same 
approach herein. These analyses are summarized below.
Parties Potentially Affected by This Rulemaking
 Satellite owners
 License applicants for launches and reentries
 Commercial space transportation suppliers
 The Federal Aviation Administration and the general public
Principal Assumptions and Sources of Information
 Benefit-Cost Analysis for the collective risk limits during 
launches and reentries (GRA study 2013 \20\ by GRA, Incorporated)
---------------------------------------------------------------------------

    \20\ GRA study can be found in the docket.
---------------------------------------------------------------------------

 FAA Office of Commercial Space Transportation forecast of 
suborbital launches using subject experts' judgments
 All monetary values are expressed in 2014 dollars
 Projected impacts for a 10-year period from 2016 to 2025
Cost-Benefit Analysis
    The FAA issued a notice of proposed rulemaking (NPRM) to amend 14 
CFR parts 417, 431, and 435 by changing the collective risk limits for 
launches and reentries and clarifying the risk limit used to establish 
hazard areas for ships and aircraft. The NPRM was published in the 
Federal Register on July 21, 2014 (79 FR 42241).
    Prior to this final rule, the FAA prohibited the expected casualty 
(Ec) for each physically distinct source of risk (impacting 
inert and explosive debris, toxic release and far field blast 
overpressure) from exceeding 30 x 10-6 or an expected 
average number of 0.00003 casualties per launch. The aggregate 
Ec equals the sum of these risks, i.e., (30 x 
10-6) + (30 x 10-6) + (30 x 10-6), for 
a total of 90 x 10-6. However, launches were not subject 
only to this single aggregate Ec limit. If there was a 
reentry using a reentry vehicle, an additional regulatory provision 
became applicable that prohibited the combined Ec of the 
launch and reentry from exceeding 30 x

[[Page 47024]]

10-6 for vehicle or vehicle debris impact hazards.\21\
---------------------------------------------------------------------------

    \21\ This limit is specified in 14 CFR 431.35, which applies 
only to reusable launch vehicles. However, 14 CFR 435.35 
incorporates and applies 14 CFR 431.35 to all reentry vehicles.
---------------------------------------------------------------------------

    Under this final rule, the FAA separates its expected casualties 
(Ec) for launches and reentries. The final rule adopts an 
aggregate Ec requirement for a launch not to exceed 1 x 
10-4 posed by the following hazards: (1) Impacting inert and 
explosive debris, (2) toxic release, and (3) far field blast 
overpressure. The FAA also finalizes a separate aggregate Ec 
requirement for a reentry not to exceed 1 x 10-4 posed by 
the hazards of debris and toxic release.
    An Ec value of 1 xx 10-4 mathematically 
equals 100 x 10-6, which is the Ec value 
currently used on federal ranges for civil and military launch and 
reentry missions. However, because the aggregate Ec limit 
uses only one significant digit in the format of 1 x 10-4, 
this final rule, in practice, allows a commercial launch or reentry 
with an aggregate Ec limit up to 149 x 10-6 to 
proceed without requiring the applicant to seek an FAA waiver.
    Based on analysis of the historical data, the FAA found the 
criteria are supported by the commercial mission experiences and post-
mission safety data available since 1989. The FAA's launch data 
indicate during this time there were 45 suborbital launches and 193 
orbital launches, for a total of 238 launches.\22\ At least four of 
these launches used an Ec that was allowed to go above the 
existing 30 x 10-6 Ec limits. None of those four 
launches resulted in any casualties or other adverse impacts on the 
public safety.
---------------------------------------------------------------------------

    \22\ AST/FAA launch data as of Feb 1, 2013, excluding 21 failed 
launches. This data can be found at http://www.faa.gov/about/office_org/headquarters_offices/ast/launch_license. See also 
Appendix A in GRA study, which can be found on the docket for this 
rule.
---------------------------------------------------------------------------

    As discussed in the preamble above, the FAA believes managing the 
precision of rounding digits below and above the Ec limit 
(i.e., 1 x 10-4) is unrealistic and unnecessary for 
administering launch or reentry licenses. By using only one significant 
digit, the Ec limit for launches become less restrictive 
than the three existing launch Ec limits combined (i.e., 90 
x 10-6). The regulatory-compliance difference between 90 x 
10-6 and 149 x 10-6 falls under the accepted FAA 
commercial launch safety margin because the level of imprecision 
associated with Ec calculations means that there is no 
substantive difference between these two Ec figures. 
However, changing the regulations to use only one significant digit 
will improve efficiency to license applicants in the launch approval 
process. In addition, using a single Ec limit that applies 
to an aggregate risk in place of three separate hazard-specific 
Ec limitations will further increase efficiency. As a 
result, the FAA believes the final rule maintains a level of safety for 
commercial launches commensurate with the current level of safety 
associated with civil and military counterparts, but will be cost-
relieving by eliminating some waiver processes necessary prior to this 
rule.
    The criteria also separately address the public risk limits of 
toxic release and inert and explosive debris risks for reentry 
operations by establishing public safety requirements similar to 
current practice. Based on past practices of administering reentry 
licenses, the FAA found it was unrealistic and unnecessary to 
administer reentry licenses with a strict Ec limit of 30 x 
10-6 for the combination of launch and reentry debris 
hazards. Aggregating Ec limits of toxic release and inert 
and explosive debris risks, the Ec limit for reentry will be 
commensurate with the safety requirements applied to civil and military 
reentries, and more conservative than past federal ranges' practices 
that gave waivers to allow non-commercial reentry missions to proceed 
with Ec risks on the order of 1 x 10-3.
    The final rule revises reentry Ec limits for toxic 
release and inert and explosive debris risks to be close to the current 
FAA reentry licensing practice, on which we assess the current economic 
baseline of the revised Ec limits. The FAA expects that the 
nominal increase in the debris Ec limit on reentry in this 
rule will impose no or minimal societal costs. This is because the FAA 
has historically issued a number of waivers to commercial launches that 
allowed those launches to exceed the regulatory Ec limits as long as 
those launches did not exceed the 100 x 10-6 Ec 
limits imposed by the federal ranges. The FAA has issued waivers to 
commercial reentries that allowed the Ec for those reentries 
to be considered separately from the Ec for launch. While 
the FAA, as part of its waiver process, has not yet had to consider 
whether a reentry operation should be issued a waiver to exceed the 30 
x 10-6 Ec limit on reentry, the FAA expects that 
its launch waiver analysis will apply equally to future reentry 
operations. Consequently, the FAA anticipates that many of the future 
reentry operations would be eligible for an FAA waiver in the absence 
of this rule. Therefore, this rule will eliminate extra expenses of 
processing such waivers.
    The FAA finalizes the NPRM's proposal to include the risks 
associated with toxic release in the Ec limitations for the 
reentry of a reentry vehicle. By including toxic release risks during a 
reentry operation, the final rule provides an incremental margin of 
safety to the public that did not exist prior to this final rule.
    The propellant load for a reentry vehicle using parachutes to land 
is generally minimal because most of the propellant will have been used 
before landing. The Ec risk for reentry vehicles landing in 
the ocean will likely be below the collective Ec limit. 
Toxic release risks for reentry will remain a minor factor in 
Ec calculations until a licensee plans to land a reentry 
vehicle on the ground, under power, using highly toxic hypergolic 
propellants carried all the way to touchdown. Currently, toxic release 
risk during launch generally exceeds an Ec of 1 x 
10-4 when a reentry vehicle with hypergolic propellants on 
board has to separate from its launch vehicle during an abort-to-orbit, 
forcing an unplanned landing on land. Hence, a reentry vehicle planning 
to land on the ground in such an abort-to-orbit scenario will not get a 
government launch license under current U.S. Air Force regulations. The 
FAA has not received applications for reentry vehicles that are capable 
of landing on land without substantial risks of releasing hypergolic 
propellants, although the FAA learned through conversations with the 
U.S. Air Force that the industry is in the early planning stage of 
developing this type of vehicle. However, if a reentry risk analysis 
found the reentry vehicle imposed a substantial toxic release risk to a 
launch site or outside of the hazard area, the reentry operator is 
required under proposed regulation to choose an alternative landing 
site to ensure any potential toxic release does not exceed the 
collective Ec of 1 x 10-4. Because operators were 
required to do a reentry risk analysis prior to this final rule, there 
will be no additional compliance costs resulting from this final rule. 
The necessary reentry risk analysis required for toxics only by this 
final rule can be done within 3 weeks of time by 1.5 analysts being 
paid at $35 per hour for the total of $6,300 per study. The FAA 
considers this analysis cost to be minimal.
    The changes in the risk limits apply to all three hazards combined 
rather than to each individual hazard. This final rule permits launch 
or reentry operations without requiring operators to seek FAA waivers 
as long as the

[[Page 47025]]

aggregated risks will not exceed 0.0001 expected casualties per launch 
or reentry mission (i.e., 1 x 10-4). Both the commercial 
space transportation industry and the government will receive savings 
attributable to less paperwork by avoiding some waiver-application 
process expenses.
    Based on historical records of requests and FAA-issued waivers from 
the previous Ec limits, the FAA estimates that launch 
operators would seek additional 38 waivers from 2016 to 2025 in the 
absence of this rule.\23\ After the promulgation of this final rule, 
the FAA expects these 38 waivers will not be needed. Thus, this final 
rule will result in savings for both the industry and the FAA, as the 
industry does not have to expend resources to request waivers and the 
FAA will not have to expend resources to evaluate waiver requests.
---------------------------------------------------------------------------

    \23\ GRA Study 2013, Table 5-7.
---------------------------------------------------------------------------

    The methodology of this final regulatory impact analysis (RIA) 
mirrors the RIA associated with the NPRM. The cost of a formal waiver 
request to industry ranges from $137,097 for 1,717 hours to $195,094 
for 2,443 hours of aerospace engineering time to prepare and submit the 
necessary documentation to the FAA for approval.\24\ Multiplying the 
forecasted 38 waivers for the 10-year period by the lower and upper 
bound costs yields cost savings ranging from $5.2 million to $7.4 
million. The estimates for the FAA's cost savings are based on the 
costs of FAA personnel time ranging from $81,231 for 1,040 hours to 
$243,693 for 3,120 hours \25\ to process each waiver request. This 
range is related to the characteristics of the individual launch or 
reentry request. Multiplied by the forecasted 38 waivers granted, the 
total estimated savings of FAA personnel time to review requests and 
issue waivers range from $3.1 million to $9.3 million. The resulting 
savings for both the industry and the FAA with an estimated mid-point 
will be approximately $12.5 million ($8.8 million present value at a 7% 
discount rate). The lower and the higher estimates are approximately 
$8.3 million and $16.7 million ($5.8 million and $11.7 million present 
value at a 7% discount rate), respectively.
---------------------------------------------------------------------------

    \24\ Basis is provided in GRA Study 2013, Appendix C, Table C-3.
    \25\ GRA Study 2013, Appendix C, Tables C-1 and C-2 for the 
basis of this value.
---------------------------------------------------------------------------

    The final rule may also result in cost-saving by reducing launch 
delays and mission scrubs. The FAA currently does not have sufficient 
data to quantify these savings, but believes the possible reduction of 
launch delays and mission scrubs may increase the overall capacity of 
the U.S. space transportation industry. Accordingly, the FAA sought 
comments on cost-savings in the NPRM and did not receive comments on 
the estimated benefits of reduced launch delays and mission scrubs. 
Therefore, the FAA maintains the same benefit determination.
    In summary, the final rule maintains safety levels for commercial 
space transportation commensurate with the current requirements applied 
to launches and reentries. In addition, the final rule will result in 
net benefits for both industry and government. The net benefit will be 
achieved by avoiding costs pertaining to applying and granting waivers 
with Ec limits between 90 x 10-6 and 149 x 
10-6. Further, related industries may also benefit by 
averting unnecessary mission delays and scrubs.

B. Regulatory Flexibility Determination

    The Regulatory Flexibility Act of 1980 (Pub. L. 96-354) (RFA) 
establishes ``as a principle of regulatory issuance that agencies shall 
endeavor, consistent with the objectives of the rule and of applicable 
statutes, to fit regulatory and informational requirements to the scale 
of the businesses, organizations, and governmental jurisdictions 
subject to regulation. To achieve this principle, agencies are required 
to solicit and consider flexible regulatory proposals and to explain 
the rationale for their actions to assure that such proposals are given 
serious consideration.'' The RFA covers a wide-range of small entities, 
including small businesses, not-for-profit organizations, and small 
governmental jurisdictions.
    Agencies must perform a review to determine whether a rule will 
have a significant economic impact on a substantial number of small 
entities. If the agency determines that it will, the agency must 
prepare a regulatory flexibility analysis as described in the RFA. 
However, if an agency determines that a rule is not expected to have a 
significant economic impact on a substantial number of small entities, 
section 605(b) of the RFA provides that the head of the agency may so 
certify and a regulatory flexibility analysis is not required.
    The FAA expects many small entities will benefit from this final 
rule because the regulatory revisions to the collective Ec 
limits are cost-relieving. The FAA solicited comments in the NPRM and 
did not receive comments with regard to this certification. Therefore, 
the FAA Administrator certifies that this rule does not have a 
significant economic impact on a substantial number of small entities.

C. International Trade Impact Assessment

    The Trade Agreements Act of 1979 (Pub. L. 96-39), as amended by the 
Uruguay Round Agreements Act (Pub. L. 103-465), prohibits Federal 
agencies from establishing standards or engaging in related activities 
that create unnecessary obstacles to the foreign commerce of the United 
States. Pursuant to these Acts, the establishment of standards is not 
considered an unnecessary obstacle to the foreign commerce of the 
United States, so long as the standard has a legitimate domestic 
objective, such the protection of safety, and does not operate in a 
manner that excludes imports that meet this objective. The statute also 
requires consideration of international standards and, where 
appropriate, that they be the basis for U.S. standards. The FAA 
assesses the potential effect of this final rule and thus determines 
that the rule does not impose obstacles to foreign commerce, as foreign 
exporters do not have to change their current export products to the 
United States.

D. Unfunded Mandates Assessment

    Title II of the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-
4) requires each Federal agency to prepare a written statement 
assessing the effects of any Federal mandate in a final rule that may 
result in an expenditure of $100 million or more (in 1995 dollars) in 
any one year by State, local, and tribal governments, in the aggregate, 
or by the private sector; such a mandate is deemed to be a 
``significant regulatory action.'' The FAA currently uses an inflation-
adjusted value of $155 million in lieu of $100 million. This final rule 
does not contain such a mandate; therefore, the requirements of Title 
II of the Act do not apply.

E. Paperwork Reduction Act

    The Paperwork Reduction Act of 1995 (44 U.S.C. 3507(d)) requires 
that the FAA consider the impact of paperwork and other information 
collection burdens imposed on the public. The FAA has determined that 
there is no new requirement for information collection associated with 
this final rule.

F. International Compatibility and Cooperation

    In keeping with U.S. obligations under the Convention on 
International Civil Aviation, it is FAA policy to conform to 
International Civil Aviation

[[Page 47026]]

Organization (ICAO) Standards and Recommended Practices to the maximum 
extent practicable. The FAA has determined that there are no ICAO 
Standards and Recommended Practices that correspond to these proposed 
regulations.

V. Executive Order Determinations

A. Executive Order 13132, Federalism

    The FAA has analyzed this final rule under the principles and 
criteria of Executive Order 13132, Federalism. The agency determined 
that this action will not have a substantial direct effect on the 
States, or the relationship between the Federal Government and the 
States, or on the distribution of power and responsibilities among the 
various levels of government, and, therefore, does not have Federalism 
implications.

B. Executive Order 13211, Regulations That Significantly Affect Energy 
Supply, Distribution, or Use

    The FAA analyzed this final rule under Executive Order 13211, 
Actions Concerning Regulations that Significantly Affect Energy Supply, 
Distribution, or Use (May 18, 2001). The agency has determined that it 
is not a ``significant energy action'' under the executive order and it 
is not likely to have a significant adverse effect on the supply, 
distribution, or use of energy.

VI. How To Obtain Additional Information

A. Rulemaking Documents

    An electronic copy of a rulemaking document my be obtained by using 
the Internet--
    1. Search the Federal eRulemaking Portal (http://www.regulations.gov);
    2. Visit the FAA's Regulations and Policies Web page at http://www.faa.gov/regulations_policies/ or
    3. Access the Government Publishing Office's Web page at http://www.gpo.gov/fdsys/.
    Copies may also be obtained by sending a request (identified by 
notice, amendment, or docket number of this rulemaking) to the Federal 
Aviation Administration, Office of Rulemaking, ARM-1, 800 Independence 
Avenue SW., Washington, DC 20591, or by calling (202) 267-9680.

B. Comments Submitted to the Docket

    Comments received may be viewed by going to http://www.regulations.gov and following the online instructions to search the 
docket number for this action. Anyone is able to search the electronic 
form of all comments received into any of the FAA's dockets by the name 
of the individual submitting the comment (or signing the comment, if 
submitted on behalf of an association, business, labor union, etc.).

C. Small Business Regulatory Enforcement Fairness Act

    The Small Business Regulatory Enforcement Fairness Act (SBREFA) of 
1996 requires the FAA to comply with small entity requests for 
information or advice about compliance with statutes and regulations 
within its jurisdiction. A small entity with questions regarding this 
document, may contact its local FAA official, or the person listed 
under the FOR FURTHER INFORMATION CONTACT heading at the beginning of 
the preamble. To find out more about SBREFA on the Internet, visit 
http://www.faa.gov/regulations_policies/rulemaking/sbre_act/.

List of Subjects

14 CFR Part 417

    Launch and reentry safety, Aviation safety, Reporting and 
recordkeeping requirements, Rockets, Space transportation and 
exploration.

14 CFR Part 420

    Environmental protection, Launch safety, Reporting and 
recordkeeping requirements, Space transportation and exploration.

14 CFR Parts 431 and 435

    Launch and reentry safety, Aviation safety, Reporting and 
recordkeeping requirements, Rockets, Space transportation and 
exploration.

The Amendment

    In consideration of the foregoing, the Federal Aviation 
Administration amends chapter III of title 14, Code of Federal 
Regulations as follows:

PART 417--LAUNCH SAFETY

0
1. The authority citation for part 417 continues to read as follows:

    Authority: 51 U.S.C. 50901-50923.


0
2. In Sec.  417.107, revise paragraphs (b)(1) through (4) to read as 
follows:


Sec.  417.107  Flight safety.

* * * * *
    (b) * * *
    (1) A launch operator may initiate the flight of a launch vehicle 
only if the total risk associated with the launch to all members of the 
public, excluding persons in water-borne vessels and aircraft, does not 
exceed an expected number of 1 x 10-4 casualties. The total 
risk consists of risk posed by impacting inert and explosive debris, 
toxic release, and far field blast overpressure. The FAA will determine 
whether to approve public risk due to any other hazard associated with 
the proposed flight of a launch vehicle on a case-by-case basis. The 
Ec criterion applies to each launch from lift-off through 
orbital insertion for an orbital launch, and through final impact for a 
suborbital launch.
    (2) A launch operator may initiate flight only if the risk to any 
individual member of the public does not exceed a casualty expectation 
of 1 x 10-6 per launch for each hazard.
    (3) A launch operator must establish any water borne vessel hazard 
areas necessary to ensure the probability of impact (Pi) 
with debris capable of causing a casualty for water borne vessels does 
not exceed 1 x 10-5.
    (4) A launch operator must establish any aircraft hazard areas 
necessary to ensure the probability of impact (Pi) with 
debris capable of causing a casualty for aircraft does not exceed 1 x 
10-6.
* * * * *

PART 420--LICENSE TO OPERATE A LAUNCH SITE

0
3. The authority citation for part 420 continues to read as follows:

    Authority: 51 U.S.C. 50901-50923.


0
4. In Sec.  420.19, revise paragraph (a)(1) to read as follows:


Sec.  420.19  Launch site location review--general.

    (a) * * *
    (1) A safe launch must possess a risk level estimated, in 
accordance with the requirements of this part, not to exceed an 
expected number of 1 x 10-4 casualties (Ec) to 
the collective members of the public exposed to hazards from the 
flight.
* * * * *

0
5. In Sec.  420.23, revise paragraphs (a)(2), (b)(3), and (c)(1)(ii) to 
read as follows:


Sec.  420.23  Launch site location review--flight corridor.

    (a) * * *
    (2) Includes an overflight exclusion zone where the public risk 
criteria of 1 x 10-4 would be exceeded if one person were 
present in the open; and
* * * * *
    (b) * * *
    (3) Includes an overflight exclusion zone where the public risk 
criteria of 1 x 10-4 would be exceeded if one person were 
present in the open; and
* * * * *
    (c) * * *
    (1) * * *
    (ii) An overflight exclusion zone where the public risk criteria of 
1 x

[[Page 47027]]

10-4 would be exceeded if one person were present in the 
open.
* * * * *

0
6. In Sec.  420.25, revise paragraph (b) to read as follows:


Sec.  420.25  Launch site location review--risk analysis.

* * * * *
    (b) For licensed launches, the FAA will not approve the location of 
the proposed launch point if the estimated expected casualty exceeds 1 
x 10-4.

0
7. In Appendix C to part 420, revise paragraphs (a)(2) and (d)(1) and 
(2) to read as follows:

Appendix C to Part 420--Risk Analysis

    (a) * * *
    (2) An applicant shall perform a risk analysis when a populated 
area is located within a flight corridor defined by either appendix 
A or appendix B. If the estimated expected casualty exceeds 1 x 
10-4, an applicant may either modify its proposal, or if 
the flight corridor used was generated by the appendix A method, use 
the appendix B method to narrow the flight corridor and then redo 
the overflight risk analysis pursuant to this appendix. If the 
estimated expected casualty still exceeds 1 x 10-4, the 
FAA will not approve the location of the proposed launch point.
* * * * *
    (d) * * *
    (1) If the estimated expected casualty does not exceed 1 x 
10-4, the FAA will approve the launch site location.
    (2) If the estimated expected casualty exceeds 1 x 
10-4, then an applicant may either modify its proposal, 
or, if the flight corridor used was generated by the appendix A 
method, use the appendix B method to narrow the flight corridor and 
then perform another appendix C risk analysis.


0
8. In Appendix D to part 420, revise paragraphs (a)(5) and (e)(2) and 
(3) to read as follows:

Appendix D to Part 420--Impact Dispersion Areas and Casualty Expectancy 
Estimate for an Unguided Suborbital Launch Vehicle

    (a) * * *
    (5) If the estimated Ec is less than or equal to 1 x 
10-4, the FAA will approve the launch point for unguided 
suborbital launch vehicles. If the estimated Ec exceeds 1 
x 10-4, the proposed launch point will fail the launch 
site location review.
* * * * *
    (e) * * *
    (2) If the estimated expected casualty does not exceed 1 x 
10-4, the FAA will approve the launch point.
    (3) If the estimated expected casualty exceeds 1 x 
10-4, then an applicant may modify its proposal and then 
repeat the impact risk analysis in accordance with this appendix D. 
If no set of impact dispersion areas exist which satisfy the FAA's 
risk threshold, the applicant's proposed launch site will fail the 
launch site location review.

PART 431--LAUNCH AND REENTRY OF A REUSABLE LAUNCH VEHICLE (RLV)

0
9. The authority citation for part 431 continues to read as follows:

    Authority:  51 U.S.C. 50901-50923.


0
10. In Sec.  431.35, revise paragraph (b)(1) to read as follows:


Sec.  431.35  Acceptable reusable launch vehicle risk.

* * * * *
    (b) * * *
    (1) To obtain safety approval, an applicant must demonstrate the 
following for public risk:
    (i) The risk to the collective members of the public from the 
proposed launch meets the public risk criteria of Sec.  417.107(b)(1) 
of this chapter;
    (ii) The risk level to the collective members of the public, 
excluding persons in water-borne vessels and aircraft, from each 
proposed reentry does not exceed an expected number of 1 x 
10-4 casualties from impacting inert and explosive debris 
and toxic release associated with the reentry; and
    (iii) The risk level to an individual does not exceed 1 x 
10-6 probability of casualty per mission.
* * * * *
0
11. In Sec.  431.43, revise paragraph (d)(2) to read as follows:
* * * * *
    (d) * * *
    (2) The expected number of casualties to members of the public does 
not exceed 1 x 10-4 given a probability of vehicle failure 
equal to 1 (pf=1) at any time the IIP is over a populated area;
* * * * *

PART 435-- REENTRY OF A REENTRY VEHICLE OTHER THAN A REUSABLE 
LAUNCH VEHICLE (RLV)

0
12. The authority citation for part 435 continues to read as follows:

    Authority: 51 U.S.C. 50901-50923.


0
13. Revise Sec.  435.35 to read as follows:


Sec.  435.35  Acceptable reusable launch vehicle risk.

    To obtain safety approval for reentry, an applicant must 
demonstrate the following for public risk:
    (a) The risk to the collective members of the public from the 
proposed launch meets the public risk criteria of Sec.  417.107(b)(1) 
of this chapter;
    (b) The risk level to the collective members of the public, 
excluding persons in water-borne vessels and aircraft, from each 
proposed reentry does not exceed an expected number of 1 x 
10-4 casualties from impacting inert and explosive debris 
and toxic release associated with the reentry; and
    (c) The risk level to an individual does not exceed 1 x 
10-6 probability of casualty per mission.

    Issued under authority provided by 49 U.S.C. 106(f), and 51 
U.S.C. 50903, 50905 in Washington, DC, on July 11, 2016.
Michael P. Huerta,
Administrator.
[FR Doc. 2016-17083 Filed 7-19-16; 8:45 am]
 BILLING CODE 4910-13-P


