SUPPLEMENTARY INFORMATION:

Table of Contents for Preamble

I. Abbreviations

II. Basis and Purpose, and Regulatory History

III. Discussion of Comments and Changes

IV. Discussion of the Rule

V. Regulatory Analysis

A. Regulatory Planning and Review

B. Small Entities

C. Assistance for Small Entities

D. Collection of Information

E. Federalism

F. Unfunded Mandates

G. Taking of Private Property

H. Civil Justice Reform

I. Protection of Children

J. Indian Tribal Governments

K. Energy Effects

L. Technical Standards

M. Environment

I. Abbreviations

ACH Automated Clearing House

BLS Bureau of Labor Statistics

CBO Congressional Budget Office

CFR Code of Federal Regulations

CG-MMC Coast Guard Office of Merchant Mariner Credentialing

DHS Department of Homeland Security

EFT Electronic Funds Transfer

Form CG-718A Certificate of Discharge to Merchant Mariner

Form CG-719B Application for Merchant Mariner Credential

FR Federal Register

FRED Federal Reserve Economic Data

GS General Schedule

GSA General Services Administration

ICR Information Collection Request

IT Information Technology

MCP Mariner Credentialing Program

MMC Merchant Mariner Credential

MMLD  Merchant Mariner Licensing and Documentation

NHTSA National Highway Traffic Safety Administration

NMC National Maritime Center

NPRM Notice of proposed rulemaking

OMB Office of Management and Budget

OPM Office of Personnel Management

RA Regulatory analysis

RFA Regulatory Flexibility Act

REC Regional Exam Center

§ Section

TWIC Transportation Worker Identification Credential

U.S.C. United States Code

USCG United States Coast Guard

II. Basis and Purpose, and Regulatory History

The legal basis of this final rule is title 46 of the United States Code (U.S.C.) Sections 7101(b) and 7301(b), which authorizes the Secretary of the Department of Homeland Security (DHS) to establish the experience and professional qualifications required for the issuance of merchant mariner licenses and documents. The DHS Secretary has delegated the rulemaking authority under 46 U.S.C. 7101 and 7301 to the Coast Guard through DHS Delegation No. 00170.1(II)(92)(e), Revision No. 01.4. Additionally, 14 U.S.C. 102(3) grants the Coast Guard broad authority to issue and enforce regulations for the promotion of safety of life and property on waters subject to the jurisdiction of the United States, which includes establishing the experience and professional qualifications required for the issuance of credentials.

This final rule revises title 46 of the Code of Federal Regulations (CFR), subchapter A, part 1, and subchapter B, parts 10-16, to allow for the electronic submission of information to the Coast Guard for the issuance of a Merchant Mariner Credential (MMC) and the supporting administrative processes, including requiring the payment of mandatory fees through the federal government-recognized system, Pay.gov. The Coast Guard is also removing the requirement for prospective mariners to take an oath before an authorized official and changing requirements for the completion and issue of a Certificate of Discharge to Merchant Mariner (Form CG-718A). In addition, the Coast Guard is making technical amendments to update addresses and websites, remove antiquated terminology, and adopt gender-neutral language.

On March 14, 2024, the Coast Guard published a notice of proposed rulemaking (NPRM) titled “Mariner Credentialing Program Transformation,” (89 FR 18706) requesting comments on the proposed changes implemented by this final rule. A detailed description of the background and proposed changes can be found in the NPRM. See 89 FR at 18707-09.

III. Discussion of Comments and Changes

In response to our NPRM, the Coast Guard received five written submissions. All were in support of the proposed changes. Two submissions each contained a single comment in support of the proposed changes. Three submissions captured multiple comments, for a total of 11 comments, which provided detailed support of the proposed changes. One comment included a recommendation, which is discussed below.

One commenter recommended the implementation of an electronic merchant mariner credential or e-credential. The Coast Guard appreciates this recommendation and may consider it as part of the future information technology system and the overall changes to the Mariner Credentialing Program (MCP), but finds the recommendation is beyond the scope of this rulemaking. Coast Guard regulations do not specify the form of the credential.

After considering these comments, the Coast Guard is making two modifications from our previously proposed changes. In the NPRM, we proposed removing the words “the applicant's fingerprints” from 46 CFR 10.209(e)(3). This paragraph concerns information supplied from the mariner's Transportation Worker Identification Credential (TWIC) enrollment before an MMC or endorsement is issued by the Coast Guard. This proposed change was included in the proposed amendatory ( printed page 102299) instructions but not in Table 2—Summary of Impacts by Affected CFR Part, Subpart, and Section, or part of the NPRM's Regulatory Analysis. See 89 FR at 18707-30.

After consideration, the Coast Guard is not removing the words “applicant's fingerprints” from 46 CFR 10.209(e)(3) as part of this final rule. Applicant's fingerprints are a required part of the TWIC enrollment process governed by the Transportation Security Administration (TSA). Although fingerprints are not specifically used by the Coast Guard at this time on MMCs, the Coast Guard will retain the ability to use fingerprints on future MMCs for increased security purposes, especially if an electronic credential is developed as suggested by a comment received to the NPRM and discussed previously.

The Coast Guard is also correcting a scrivener's error contained in our proposed amendatory language for 46 CFR 10.209(d)(1) by removing an unintentional repeat of the word “and.”

Finally, this final rule removed some amendatory language included in the NPRM that was superseded by the publication of Electronic Submission of Mariner Course Completion Data final rule (Docket No. USCG-2021-0097, RIN 1625-AC75) on November 25, 2024.

IV. Discussion of the Rule

This final rule allows for the electronic submission of MMC applications and supporting documents to the Coast Guard and requires electronic payment of mandatory fees through Pay.gov. This final rule also removes the requirement for original MMC applicants to take an oath before an authorized official or notary because the Coast Guard has determined it is a redundant part of the original MMC application process. This rule further amends the process for issuing certificates of discharge for mariners after completing a voyage by clarifying the procedures and by allowing for electronic processing and recordkeeping. Finally, the Coast Guard makes non-substantive changes to antiquated terminology and out-of-date website and address information to clarify existing regulatory text in the affected subparts of the CFR.

To prepare for the future acquisition of an information technology (IT) system to replace the antiquated and inefficient Merchant Mariner Licensing and Documentation (MMLD) system used by the MCP, this rule amends 46 CFR subchapter A, part 1, and subchapter B, parts 10-16, to allow for electronic submission of information, in a manner specified by the Coast Guard, to obtain MMCs, medical certificates, and the approval of mariner training courses and programs, Qualified Assessors, and Designated Examiners. Providing for the electronic submission of required information streamlines the credentialing process and prepares for the fully electronic IT system that will be used by the MCP and industry.

This final rule requires electronic payment of mandatory fees through Pay.gov. Manual processing of the previously allowed cash, checks, credit cards, or money orders required significant work hours by National Maritime Center (NMC) and Regional Exam Center (REC) personnel, were difficult to validate and protect using the current system and did not meet the requirements of the U.S. Treasury. With this final rule, the Coast Guard no longer directly accepts payments made using these methods at RECs. Applicants who wish to continue to use cash or money orders can obtain a prepaid credit card to pay fees using Pay.gov. Applicants who wish to pay via personal check can make an Automated Clearing House (ACH) payment through Pay.gov.

As noted in Section III. Background, of this preamble, the Coast Guard anticipates the use of cash or money orders to continue to decrease, based upon previous payment statistics. This also reflects the overall public trend in the United States to make payments using a credit card, debit card, or check. The 2019 Federal Reserve Payments Study and subsequent updates indicate a continued trend to using cards and ACH, with the growth rate of core noncash payments being 6.7 percent per year from 2015 to 2018, higher than the growth rate of 5.1 percent per year from 2012 to 2015.^[1] Credit and debit card usage numbers declined with the onset of the COVID-19 pandemic, mostly from the lack of in-person transactions, but general growth continued, including the percentage of ACH payments.^[2] Electronic payment reduces the burden on Coast Guard personnel who process non-electronic payments (cash, check, money orders) and improves customer service to mariners by allowing for better reconciliation and more efficient processing of payments and refunds.

This rule also changes 46 CFR 14.307, regarding entries on certificates of discharge for mariners after completing a voyage, to clarify the procedures and allow for electronic processing and recordkeeping. The process is clarified by requiring that each Master or individual in charge must, for each individual mariner being discharged from the vessel, prepare a Form CG-718A, in accordance with the procedures prescribed by the Coast Guard. The prescribed format may include the current CG-718A or other means provided by the Coast Guard, which allows for electronic processing if available in a new MCP system.

If a Master or individual in charge of a vessel do not use a Coast Guard-prescribed format, the mariner must be provided with all the same information included on Form CG-718A. This ensures the vessel Master or operating companies provide the required information to the mariner but allows for them to use vessel or company specific means, such as a payroll system incorporated in their vessel administrative systems. Following each voyage, every mariner being discharged must validate the information on Form CG-718A by signing it. The change from signing in “permanent ink” to “by signing” allows for more modern methods such as electronic signature or document verification. Finally, when the mariner departs the vessel, the Master or individual in charge must give Form CG-718A to the mariner, which could be provided electronically with the changes. The changes to Form CG-718A's process creates a more modern and electronic means of processing the document. Under this final rule, there is no change to the certificate of discharge transmission process under 46 CFR 14.311.

In addition, this final rule removes the requirement to take an oath before an authorized official while certifying an Application for Merchant Mariner Credential (Form CG-719B). By signing the form, an individual attests to “solemnly swear or affirm” to abide by the requirements of the oath. This legally binds a mariner, so no additional requirement before an authorized official is necessary. The Coast Guard also anticipates that the future MCP system would allow for electronic signatures and additional verification of identity, further negating the need for the requirement to take an oath before an authorized official.

Finally, the Coast Guard adds technical amendments to 46 CFR parts 1 and 10-16 as part of this rulemaking. These amendments account for updates to websites and addresses, remove antiquated language (such as “licenses” and “Merchant Mariner Document (MMD)”, as those credentials are no ( printed page 102300) longer issued by the Coast Guard), and make non-substantive changes to ensure gender-neutrality throughout.

V. Regulatory Analysis

We developed this final rule after considering numerous statutes and Executive orders related to the final rule. A summary of our analyses based on these statutes or Executive orders follows.

A. Regulatory Planning and Review

Executive Orders 12866 (Regulatory Planning and Review), as amended by Executive Order 14094 (Modernizing Regulatory Review), and 13563 (Improving Regulation and Regulatory Review) direct agencies to assess the costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, distributive impacts, and equity). Executive Order 13563 emphasizes the importance of quantifying both costs and benefits, of reducing costs, of harmonizing rules, and of promoting flexibility.

This rule has not been designated by OMB as a significant regulatory action under section 3(f) of Executive Order 12866, as amended by Executive Order 14094. Accordingly, OMB has not reviewed it. The Coast Guard received no public comments on the regulatory analysis for the proposed rule. Details on the estimated cost savings of this final rule can be found in the rule's Regulatory Analysis (RA) that follows.

Changes From the Notice of Proposed Rulemaking

For the reasons discussed in section III of this preamble, Discussion of Comments and Changes, we have made two changes to the regulatory text from the proposed rule. In § 10.209(e)(3), we retain the regulatory text “the applicant's fingerprints,” and in § 10.209(d)(1), we make a minor editorial change to remove an extra word “and” in the regulatory text. These changes do not necessitate a change to either the methodology or type of data used in the RA from the NPRM. We updated the regulatory analysis from the NPRM to account for 2023 wage rates.

For this regulatory analysis, the term “applicants” refers to all individuals who pay mandatory fees associated with an MMC application. The changes and estimated cost savings for § 10.219(d) affect these applicants. The phrase “original applicants” refers to individuals who are applying for their first MMC and therefore are currently required to take an oath before an authorized official. The number of original applicants is a subset of all applicants because they must also pay fees. The changes and cost savings to § 10.225(c) affect only original applicants.

In this final rule, the Coast Guard updates 46 CFR subchapter A, part 1, and subchapter B, parts 10-16. The final rule will:

• Require electronic payment of merchant mariner credentialing fees in § 10.219(d); ^[3]

• Remove the requirement for an oath to be administered by an official who serves as a notary public (or an authorized official who can administer an oath) on Form CG-719B in § 10.225(c);
• Allow for the electronic submission of certain documents in §§ 1.03-15(h)(2)(i) for appeals involving course approvals and merchant mariner personnel issues and 10.219(i) for requests involving no-fee MMCs;
• Consolidate, condense, and clarify regulatory text for the processing of Form CG-718A in §§ 14.307(a), (b), and (c) when a mariner completes a voyage; and
• Make non-substantive, editorial changes to current regulatory text, such as pronoun changes, address changes, the removal of certain terms, and other minor grammatical changes.

Table 1 presents a summary of the impacts of the final rule.

( printed page 102301)

( printed page 102302)

We discuss the economic impact of these items individually in the cost savings section of this RA.

This final rule generates cost savings to applicants, including original applicants, for two changes in 46 CFR 10.219(d) and 10.225(c), and for the Federal Government in § 10.219(d).

For § 10.219(d), each applicant will save approximately $13.06 for a credit card payment and about $11.41 for a cash payment with this final rule.

For § 10.225(c), under Assumption 1, for all applicants, an individual applicant will save about $17.68; and under Assumption 2, for half of the applicants (6,976), each applicant who goes to a bank branch will save about $17.68; for the other half (6,976) of the applicants who go to a notary service, half of whom pay by credit card (3,488) and half of whom pay by cash (3,488); each applicant who pays by credit card will save about $23.61, and by cash, about $22.24.

First, the changes in § 10.219(d) requires an applicant for an MMC to pay the required evaluation, examination, and issuance fees by electronic means through Pay.gov. Currently, an applicant can make a payment in person at an REC using cash, check, credit card or money order. With this final rule, the Coast Guard no longer accepts direct payments made using these methods; as a result, this final rule removes the payment options made with cash, check (in person), credit card (in person), and money order, and payments made by standard mail. The cost savings that we estimate for § 10.219(d) are for applicants who no longer expend the time to visit an REC to pay the fees by cash, check, credit card, and for payments made by check through standard mail. For the purpose of this analysis, we analyzed payments made by cash and credit card because they represented the majority of payments made in person at RECs. We also analyzed check and money order payments made by applicants outside of RECs. In addition to cash and credit card payments, applicants can also make payments by check and money order in person at an REC. However, the Coast Guard does not collect data to show where applicants made these payments. For this analysis and based on Coast Guard information from RECs, ( printed page 102303) most applicants pay by cash or credit card at RECs; we then assumed applicants made check and money order payments by standard mail outside of an REC.

The changes to § 10.219(d) also generates cost savings for the Federal Government and Coast Guard employees who no longer expend the time to process in-person payment transactions at RECs.

The cost savings associated with § 10.225(c) is from the removal of the requirement to have an oath administered by a person legally qualified to administer an oath, or a notary public, near an original applicant's place of residence (in the town or city where an original applicant resides) before an original applicant receives an MMC.^[6] The Coast Guard does not expect the Federal Government to realize any cost savings associated with this change. The remaining changes will not generate any costs or cost savings to the maritime industry, individuals, or the Federal Government. Lastly, this final rule does not alter any current OMB-approved Coast Guard information collection request (ICR).

§ 10.219(d)

We estimate the total discounted cost savings for the change to § 10.219(d) for applicants who pay mandatory fees at RECs (typically by cash or credit card) and for applicants who pay by check and money order outside of an REC through standard mail to be approximately $1.0 million, rounded, over a 10-year period of analysis, using a 7-percent discount rate. The cost savings are associated with the time (transaction time) applicants save from making in-person payments to using Pay.gov. We estimate the annualized cost savings for applicants who pay in-person at RECs and by cash to be approximately $3,319 rounded, using a 7-percent discount rate. We estimate the annualized cost savings for applicants who pay in-person at RECs by credit card to be approximately $130,039, rounded, using a 7-percent discount rate. We estimate the annualized cost savings for applicants who pay by check and money order through standard mail to be approximately $7,962 rounded, using a 7-percent discount rate. Finally, we estimate the total annualized cost savings of part 10.219(d) to applicants who pay in-person at RECs and by check and money order to be approximately $141,320 ($3,319 + $130,039 + $7,962), rounded.

We estimate the discounted cost savings to the Coast Guard for the change to § 10.219(d) to be approximately $230,491 over a 10-year period of analysis, using a 7-percent discount rate. In addition, we estimate the annualized cost savings to the Coast Guard for this regulatory provision to be approximately $32,817, rounded, using a 7-percent discount rate.

§ 10.225(c)

In this regulatory analysis, we make two assumptions associated with the removal of the requirement to take an oath before an authorized official in § 10.225(c). These assumptions apply to applicants who pay the mandatory fees and take an oath at a location other than an REC or at their place of residence (for the purpose of this regulatory analysis, we refer to individuals who are affected by the changes to § 10.225(c) only as “original applicants”). These two assumptions are necessary because the Coast Guard does not have data on whether original applicants obtain an oath through a notary public service at a bank near their place of residence, which is (Assumption 1), where an individual can obtain an oath for an original application along with a notary public signature, which we assume to be free of charge; or elsewhere, other than a bank, which is (Assumption 2), where there is a cost for the notary public service.^[7]

Therefore, if the reader accepts Assumption 1 to be representative of the current actions by applicants, then the cost savings the Coast Guard estimates for this assumption to be the cost savings of the final rule, in addition to the cost savings from the change to § 10.219(d). If the reader accepts Assumption 2 to be representative of the current actions by applicants, then the cost savings the Coast Guard estimates for this assumption is the cost savings of the final rule, in addition to the cost savings from the change to § 10.219(d).

Other assumptions may be made by the reader about the locations or establishments where original applicants obtained an oath through a notary public service, such as through legal services, at a title application company, or other such local business services, but we believe these assumptions capture the actions that applicants take when they apply for MMCs. Lastly, for the purpose of this analysis, the Coast Guard assumes applicants have bank accounts.

Assumption 1 for § 10.225(c):

Our first assumption is that original applicants, who are affected by this part of the final rule, can obtain an oath through a notary public service or at a bank branch (which we assume to be free of charge with a bank account) near where they reside.^[8] Under this assumption, we estimate this final rule will save all original applicants (an estimated 13,951 annually, rounded) a discounted amount of approximately $1.7 million over a 10-year period of analysis, using a 7-percent discount rate. The cost savings include the cost of the travel time for an applicant who travels to obtain a notary public, the mileage cost, and the time an applicant waits at a bank to obtain a notary public signature. We estimate the annualized cost savings for original applicants to be approximately $246,640, using a 7-percent discount rate. These figures do not include the cost savings for the change to § 10.219(d).

Assumption 2 for § 10.225(c):

Our second assumption is that half of the original applicants can obtain an oath through a notary public service at a bank or bank branch near where they reside, which we assume to be free of charge (with a bank account). The other half of original applicants (an estimated 6,976 annually, rounded) can obtain this service at a state office, an establishment that provides notary public services, or a similar entity which charges for a notary public service. Assumption 2 considers the cost savings associated with the removal of the oath and the notary public service for the affected population of all original applicants, or 13,951. Under this assumption, we assumed half of the original applicants will obtain a notary public at a bank, where it is free of charge, and half at an ( printed page 102304) establishment other than a bank, where there is a cost for a notary public. The cost savings for half of the original applicants who obtain a notary public at a bank is from the time it takes to travel to a bank, the mileage cost, and the time to wait at a bank for a notary public. The cost savings for the other half of original applicants who obtain a notary elsewhere is the same as applicants that go to a bank with the addition of the cost savings from not having to pay for a notary public.

With this assumption, the Coast Guard estimates the final rule will save original applicants a discounted amount of approximately $2.3 million over a 10-year period of analysis, using a 7-percent discount rate. The Coast Guard estimates the annualized cost savings for original applicants to be approximately $326,232, using a 7-percent discount rate. These figures do not include the cost savings for the change to § 10.219(d).

For each assumption, the Coast Guard adds the same cost savings estimate for original applicants who are required to pay the fees electronically under the changes to § 10.219(d), or $141,320 annualized, rounded. Specifically, for Assumption 1, the Coast Guard estimates the total discounted cost savings of the final rule for applicants to be approximately $2.7 million over a 10-year period of analysis, using a 7-percent discount rate. The Coast Guard estimates the total annualized cost savings of the final rule under this assumption to be approximately $387,959.

For Assumption 2, the Coast Guard estimates the total discounted cost savings of the final rule for applicants to be approximately $3.3 million over a 10-year period of analysis, using a 7-percent discount rate. The Coast Guard estimates the total annualized cost savings of the final rule under this assumption to be approximately $467,552.

In addition, the final rule generates benefits in the form of cost savings to MMC applicants. These benefits include:

• A simplified payment transaction through electronic means (Pay.gov), saving applicants time and money; and
• Reduced time burden for original applicants who no longer need to obtain an oath before an authorized official, which saves time and money.

This final rule generates unquantifiable benefits, which include:

• Flexibility for applicants by providing the option to electronically submit documents including the no-fee determination of eligibility request and the certificate of discharge; unquantifiable cost savings for applicants who choose the option to electronically submit certain documents;
• Removal, addition, and clarification of regulatory text for Form CG-718A and other non-substantive regulatory text changes. The benefit to mariners is clearer regulatory text as a result of the editorial changes that we made.

Table 2 presents a summary of the estimated impacts of the final rule.

( printed page 102305)

( printed page 102306)

( printed page 102307)

( printed page 102308)

( printed page 102309)

( printed page 102310)

( printed page 102311)

( printed page 102312)

( printed page 102313)

( printed page 102314)

Affected Population

The affected population of this final rule are applicants for an MMC (includes original applications or applicants who apply for an MMC for the first time) who pay MMC fees in person at an REC or outside of an REC through standard mail. Based on historical data from the NMC, the Coast Guard analyzed information on applicants who paid mandatory fees electronically through Pay.gov over a 7-year period from 2015 to 2021. Based on payment data from the NMC, one payment transaction represents one applicant for all transactions. Under this assumption, we assumed an applicant makes one trip to an REC and pays for all transactions at that time instead of taking time to make multiple trips and paying separately for transactions. For applicants who paid fees in person at RECs, the Coast Guard used a 5-year data period from 2015-2019 because after 2019, in-person transactions became very sporadic at RECs due to COVID-19 pandemic protocols and the data are not representative of the transactions over this period of time. The Coast Guard then established two population groups. For § 10.225(c) of this final rule, the Coast Guard defined the population as original applicants who paid mandatory fees by money order, check, and through Pay.gov, which gave us the number of applicants who took the oath outside of an REC and obtained a notary public service near where they reside. This is for individuals who applied for an original MMC only. As an annual average, the NMC recorded approximately 13,951 payment transactions for original applications between 2015 and 2021.

For § 10.219(d) of this final rule, the Coast Guard defined part of the population as applicants who paid the fees by cash or credit card in person at RECs for original applications, which gave us an estimated the number of individuals who likely took the oath at RECs, where it is free of charge.^[9] As an annual average, the NMC recorded approximately 1,206 in-person payment transactions for original applications between 2015 and 2019. For all other fees paid by applicants other than original applicants, the NMC recorded an annual average of 9,043 in-person payment transactions between 2015 and 2019. The Coast Guard estimates the total average annual population of applicants, who paid fees in person at an REC during this period, to be approximately 10,249 applicants.

Between 2015 and 2021, the Coast Guard also recorded an annual average of approximately 12,638 payments made by applicants who paid by check or money order outside of an REC through standard mail. Therefore, the Coast Guard estimates the total average annual population affected by this final rule to be approximately 36,838 (13,951 + 10,249 + 12,638) applicants (see table 3).

( printed page 102315)

Cost Savings Analysis

Two changes in this final rule (in 46 CFR 10.219(d) and 10.225(c)) result in quantifiable cost savings for MMC applicants. The other changes have no quantifiable economic impact on individuals, companies, or businesses, and will not result in costs or cost savings to them.

The option in 46 CFR 1.03-15(h)(2)(i) and 10.219(i)(1) for electronic submission of certain documents that currently must be submitted by paper copy (see table 2) will likely have cost savings associated with it, but we are not able to quantify these savings in this analysis because the Coast Guard does not have data to show how many electronic submissions we will receive in the future. Additionally, because of the COVID-19 pandemic, the Coast Guard is not able to accurately determine a future trend of the number of documents that applicants will choose to submit to the Coast Guard electronically.

In table 2, we presented a summary of the estimated impacts of the final rule and provided a description of the change for each affected CFR section. Where the description reads “Editorial; non-substantive regulatory text changes,” we make changes that include the addition, deletion, consolidation, and clarification of regulatory text that do not have cost or cost savings associated with them. These changes include minor grammatical revisions, such as changes to punctuation and pronoun changes; the clarification of regulatory text by removal, deletion, or consolidation of terms; definitional changes; and changes that update Coast Guard website addresses. This includes changes in § 10.209(d)(2), “General Application Procedures,” where the Coast Guard removes the regulatory text governing the submission of certain documents by applicants. There are no costs or cost savings for individuals that are associated with this change because the Coast Guard still retains this requirement in §§ 10.227 and 10.231.

For § 1.03-15(h)(2)(i), “General,” the Coast Guard adds the option of electronic submission of an appeal for course approvals and merchant mariner personnel to the Coast Guard. There are no quantifiable cost or cost savings associated with this change because the Coast Guard does not have data on the future use of electronic submission for appeals. The Coast Guard still accepts the current paper-copy submission method for appeals.

For § 10.219(i)(1), “Determination of Eligibility,” the Coast Guard adds the option of electronic submission of an eligibility request to the Coast Guard for the items listed in 10.219(h). There are no quantifiable cost or cost savings associated with this change because the Coast Guard does not have data on the future use of electronic submission with this item. The Coast Guard still accepts the current paper-copy submission method for these requests.

For § 14.307, “Entries on certificate of discharge,” the information the Coast Guard removes in current paragraphs (d) and (e) is currently contained in form CG-718A, “Certificate of Discharge to Merchant Mariner;” therefore, there is no cost or cost savings associated with this change.^[10] The Coast Guard removes, consolidates, and condenses the existing regulatory text into paragraphs (a), (b), and (c) of this section. The changes to this section do not change the current OMB-approved ICR or alter its burden estimates because the Coast Guard is not making any changes to the reporting requirements in form CG-718A.

Cost Savings Analysis for the Changes to § 10.219(d)/Electronic Payment of Fees

The Coast Guard amends § 10.219(d) and removes the option for applicants to pay merchant mariner credentialing fees in person at an REC by cash or credit card (applicants who pay in person may also pay by check or money order; because the Coast Guard does not collect data on where these payments were made, and based on payment data from the NMC, most applicants pay by cash or with a credit card in person) since credit card transactions are processed by individual RECs and cash payments are not accepted through standard mail. The Coast Guard instead requires all payments to be made electronically through the Government's payment system at Pay.gov .^[11] For ( printed page 102316) payments made by check outside of an REC, applicants mailed the checks to the Coast Guard by standard mail. With the final rule, the Coast Guard still accepts payment by check, but applicants are required to use a bank ACH payment through Pay.gov. Applicants who mailed checks to the Coast Guard will save the postage cost with this final rule. The Coast Guard expects that applicants have access to the requisite technology to pay credentialing fees through Pay.gov . According to the U.S. Census Bureau's 2022 American Community Survey, approximately 95 percent of American households have one or more electronic devices such as a desktop or laptop computer, a smartphone, or tablet.^[12] This included over 90 percent of households that have an internet subscription that will facilitate access to Pay.gov .^[13] Even if an applicant or household does not have access to a computer at home or the internet individually, in this case, the Coast Guard assumes for the purpose of this analysis, that an applicant may access a smartphone, cellphone, or computer to submit an application to the Coast Guard without incurring a cost.^[14] Additionally, with this final rule, we assume that a small population of applicants affected by part 10.219(d), who submit applications at RECs currently, will choose to continue to visit RECs and will continue to print receipts as proof of payment. However, the Coast Guard is not able to determine the number of applicants who will continue to visit RECs for this purpose. Therefore, there is an unquantifiable cost of the final rule with printing the receipts for a small number of applicants who visit RECs to submit their applications. This results in a small, unknown reduction in the total estimated cost savings of this rule.

Applicants may visit an REC for many reasons; for example, to take an examination, to ask questions about the application process, submit an application, pay the mandatory fees, obtain an oath from an authorized individual, or for other reasons. This is notable in the following cost savings analysis because the Coast Guard does not include travel cost savings estimates for the affected applicants in our analysis of the impact of the change to § 10.219(d). The Coast Guard reasons that, although it is possible for applicants to visit RECs exclusively to pay MMC fees, the Coast Guard does not retain data on the number of applicants who do so. In practice, the Coast Guard assumes applicants do not visit an REC to solely pay the fees. Therefore, the Coast Guard cannot attribute travel costs to applicants who pay the mandatory fees in person at an REC. For example, applicants may visit RECs to ask questions about the application process and may decide to pay the fees during the same visit. Or applicants may visit RECs to obtain an oath, not realizing that RECs accept in-person payment, and may decide to pay the fees during this visit. The Coast Guard also assumes that applicants pay the mandatory fees at one time.

The requirement for applicants to pay MMC fees electronically through Pay.gov eliminates the flexibility to pay these fees by cash, and money order, by standard mail, and directly at an REC (see footnote number 13). However, with Pay.gov, the Coast Guard believes applicants will find this payment method to be more convenient and secure because applicants are able to pay MMCs fees from their home instead of traveling to an REC and expending the time and money by making a payment in person, as we discuss later in this analysis. The Coast Guard acknowledges that there may be a small subset of the applicant population that still prefer to pay MMC fees in person instead of through Pay.gov after an effective final rule.

The Coast Guard collects data for all payment transactions including transactions for original MMC applications. Between 2015 and 2019, the Coast Guard recorded an annual average of 1,167 credit card transactions for original applications made in person by applicants at an REC. It also recorded an average annual of 8,791 credit card transactions for other fees for a total average annual of 9,958 credit card transactions over these 5 years. During the same period, the Coast Guard recorded an average annual of 39 cash payment transactions for original applications made in person by applicants at an REC. It also recorded an average annual of 252 cash transactions for other fees for a total average annual of 291 cash transactions for these 5 years. Therefore, the total average annual number of transactions made in person was approximately 10,249 over the 5-year time period.

The NMC estimates it takes applicants approximately 5 minutes, or 0.083 hours (rounded), to complete a payment through Pay.gov. The NMC estimates it takes a certain amount of time for applicants to make in-person application payments at an REC. For applicants who pay by credit card, the NMC estimates it takes approximately:

• 8 minutes, or approximately 0.13 hours (rounded), to enter RECs due to security checks;
• 3.5 minutes, or approximately 0.06 hours (rounded) to wait in line for a clerk; and
• 7.5 minutes, or approximately 0.13 hours (rounded) to make the payment and complete the transaction, for a total of approximately 0.32 hours.

Therefore, the net amount of time (time difference) applicants save by making payments electronically rather than by credit card in person is approximately 0.237 hours (0.32-0.083 hours).

For applicants who pay by cash, the NMC estimates it takes approximately:

• 8 minutes, or approximately 0.13 hours (rounded) to enter RECs due to security checks;
• 3.5 minutes, or approximately 0.06 hours (rounded) to wait in line for a clerk; and
• 6.0 minutes, or approximately 0.10 hours to make the payment and complete the transaction, for a total of approximately 0.29 hours.

Therefore, the net amount of time applicants save from making payments electronically rather than making cash payments in person is approximately 0.207 hours (0.29-0.083 hours).

The payment time we used for Pay.gov does not account for the time to create a personal account on Pay.gov. Individual payments may be made without creating an account. Pay.gov provides the same capabilities to pay credentialing and other fees and obtain a receipt without creating an account. For this analysis, the Coast Guard assumes individuals will not create an account because credentialing fees are typically paid only once every five years, which aligns with the validity ( printed page 102317) period of an MMC. Using Pay.gov infrequently does not necessitate the need to create an account.

Anyone meeting the citizenship requirement under 46 CFR 10.221 and of an eligible age can apply for an MMC, regardless of their current employment status. For this regulatory analysis, the Coast Guard assumed applicants for an original MMC are currently employed (this is for original applications where an oath is currently required); this allows the Coast Guard to construct a cost savings analysis, because we can then obtain applicants' wage rates, the labor time, and the cost savings associated with the removal of the in-person payment option.

Additionally, because the Coast Guard does not know the current occupations of individuals who apply for an original MMC and pay fees in person at an REC, the Coast Guard used the Bureau of Labor Statistics' (BLS) “Occupational and Employment Statistics” database and May 2023 wage estimates to obtain the general occupational code (BLS code 00-0000) for all civilian workers in the U.S., which is the largest occupational category of workers the Coast Guard found at BLS' website.^[15] The unloaded mean hourly wage rate for this occupational category is $31.48. The Coast Guard does not collect employment data on applicants; nevertheless, the Coast Guard acknowledges that the assumption of employment may lead to an overestimation of cost savings for the final rule.

Because fees are also paid in person at an REC mostly by applicants other than original applicants, the Coast Guard used the BLS occupational category, Water Transportation Workers (BLS code 53-5000) to obtain the unloaded mean hourly wage rate for all applicants who pay fees in person at RECs. The unloaded mean hourly wage rate in 2023 for this occupational category is $38.00.

Because the Coast Guard used different occupational categories, this required us to use two load factors to obtain an average load factor.

To obtain a loaded mean hourly wage rate for civilian workers, the Coast Guard used BLS' “Employer Costs for Employee Compensation” database to calculate the load factor for this group of workers in the U.S. The Coast Guard used the same database to obtain a load factor for the occupational category of Water Transportation Workers. The Coast Guard then used the average load factor for these two groups of workers in the U.S. The Coast Guard applied the load factor to the average unloaded mean hourly wage rate using fourth quarter data from 2023 for all applicants. The Coast Guard determined the average load factor for the two occupational categories to be about 1.45, rounded.^[16] The Coast Guard then multiplied this average load factor by the unloaded mean hourly wage rate for applicants, who pay fees in person at RECs, and obtained a loaded mean hourly wage rate of approximately $55.10, rounded ($38.00 × 1.45).

Applicants (including original applicants) who currently pay the fees by credit card at an REC are required to pay them electronically using Pay.gov under this final rule. This affects approximately 9,958 applicants annually. The Coast Guard estimates the undiscounted cost for these applicants to be approximately $45,541 annually (9,958 × $55.10 × 0.083 hours), rounded. The Coast Guard estimates the undiscounted baseline cost for applicants who currently pay the fees by credit card in person at an REC to be approximately $175,580 annually (9,958 × $55.10 × 0.32 hours), rounded. Therefore, the Coast Guard estimates the undiscounted net cost savings to applicants who currently pay the fees in-person by credit card and are now required to pay them electronically through Pay.gov to be approximately $130,039 annually ($175,580−$45,541), rounded.

Similarly, applicants (including original applicants) who currently pay the mandatory fees by cash at an REC are required to pay them electronically using Pay.gov under this final rule. This affects approximately 291 applicants annually. The Coast Guard estimates the undiscounted cost for these applicants to be approximately $1,331 annually (291 × $55.10 × 0.083 hours). The Coast Guard estimates the undiscounted baseline cost for applicants who currently pay the fees by cash in person at an REC to be approximately $4,650 annually (291 × $55.10 × 0.29 hours), rounded. Therefore, the Coast Guard estimates the undiscounted net cost savings to applicants who currently pay the fees by cash and will need to pay them electronically through Pay.gov to be approximately $3,319 annually ($4,650−$1,331), rounded. The Coast Guard estimates the total undiscounted net cost savings for 10,249 (9,958 by credit card + 291 by cash) applicants who currently pay the mandatory fees in-person by credit card and cash and will need to pay them electronically through Pay.gov to be approximately $133,358 annually ($130,039 by credit card + $3,319 by cash), rounded. See table 4.

( printed page 102318)

Lastly, the final rule creates cost savings for applicants, other than original applicants, who paid mandatory fees by check or money order in the past and mailed the payment to the Coast Guard through standard mail, or USPS. Over the 7-year period from 2015 to 2021, the Coast Guard recorded an annual average of 12,638 payments (10,146 by check and 2,492 by money order) where an applicant used a check or money order. Because this regulatory analysis is in 2023 dollars, the cost of a forever stamp from the USPS in 2023 was $0.63.^[17] With this final rule, applicants will be able to use a check or money order to make mandatory fee payments with Pay.gov; however, payments made by check must be made with an ACH payment and for money orders, a prepaid card (see footnote number 15). The Coast Guard did not estimate cost savings for applicants who currently mail checks or money orders to the Coast Guard and will be required to use Pay.gov because we do not estimate that there is a time difference between these two payment methods and Pay.gov. The total undiscounted cost for these payment types is approximately $7,962 annually, rounded. The final rule creates cost savings in the same amount annually. The Coast Guard estimates the total 10-year discounted cost savings for applicants who can no longer mail a check or money order (cost savings are from the cost of a forever stamp) to pay for mandatory fees to be approximately $55,921, rounded, using a 7 percent discount rate. The Coast Guard estimates the annualized cost savings to be approximately $7,962, rounded, using a 7-percent discount rate.

In table 5, the Coast Guard presents the 10-year discounted cost savings to applicants who currently paid the fees in person and are required to pay them electronically under this final rule, and applicants who paid the fees by check or money order and sent their payments by standard mail to the Coast Guard. The Coast Guard estimates the total undiscounted cost savings for the electronic payment of fees by applicants to be approximately $141,320 annually, rounded ($133,358 from in-person payments + $7,962 from mailed checks and money orders). The Coast Guard estimates the total discounted 10-year cost savings for these applicants to be approximately $1.0 million, rounded, using a 7-percent discount rate. The Coast Guard estimates the annualized cost savings to be approximately $141,320, rounded, using a 7-percent discount rate.

( printed page 102319)

Federal Government Cost Savings for the Change to § 10.219(d)

This final rule creates cost savings for the Coast Guard in the amount of time that is saved by REC personnel who no longer process in-person payment transactions. The NMC estimates it takes fee clerks at an REC approximately 5 minutes, or 0.083 hours (rounded), to process credit card payments. Similarly, the NMC estimates it takes mandatory fee clerks approximately 25 minutes, or 0.42 hours (rounded), to process cash payments. This includes the processing time the fee clerk takes to go to a bank and obtain a money order in order to complete the payment transaction. There is no difference in the time it takes for a fee clerk at an REC to process a check mailed to the Coast Guard and the time it would take with this final rule to process an ACH payment. There is also no difference in the time it takes for a fee clerk to process a money mailed to the Coast Guard and the time it takes with this final rule to process a prepaid card used from a money order. Therefore, the Coast Guard does not estimate cost savings for the Federal Government from not processing checks and money orders mailed to the Coast Guard by applicants.

A fee clerk at an REC has a Federal Government General Schedule (GS) grade level of GS-5. The Office of Personnel Management (OPM) lists the hourly pay for Federal Government employees who work in the United States.^[18] Because RECs are geographically dispersed across the U.S., the Coast Guard used the hourly wage rate for the category “Rest of the United States” from OPM's pay tables. OPM reports the hourly pay for a person with the grade level of a GS-5, step 5 (the midpoint of the pay level) as $20.47 in 2023. The Coast Guard calculated the share of total compensation of Federal Government employees to account for the non-wage benefits to determine the load factor that the Coast Guard applied to the hourly wage rate of employees. In a Congressional Budget Office (CBO) report titled “Comparing the Compensation of Federal and Private-Sector Employees, 2011 to 2015,” the CBO reports total compensation of Federal Government employees to be approximately $64.80, and wages and salaries to be approximately $38.30.^[19] From these values, the Coast Guard determined the load factor to be about 1.69, rounded ($64.80 ÷ $38.30). The Coast Guard then multiplied this value by the hourly wage rate of $20.47 to obtain a loaded hourly wage rate of $34.59, rounded, for a GS-5, step 5 fee clerk at an REC.

The Coast Guard estimates the baseline undiscounted cost for REC fee clerks to process credit card transactions to be approximately $28,589 annually, rounded ($34.59 × 9,958 credit card transactions annually × 0.083 hours). The Coast Guard estimates the baseline undiscounted cost for REC payment clerks to process cash transactions to be approximately $4,228 annually, rounded ($34.59 × 291 cash transactions annually × 0.42 hours). Because RECs no longer accept in-person payments with this final rule, these costs combined become cost savings to the Coast Guard of approximately $32,817 annually, rounded ($28,589 + $4,228). See table 6.

( printed page 102320)

In table 7, the Coast Guard estimates the total discounted 10-year cost savings of this final rule to the Coast Guard to be approximately $230,491 rounded, using a 7-percent discount rate. The Coast Guard estimates the annualized cost savings to be approximately $32,817, rounded, using a 7-percent discount rate.

Cost Savings Analysis for the Change to § 10.225(c), Removal of the Oath Requirement

The Coast Guard removes the current requirement in § 10.225(c) for applicants for an original MMC to take an oath administered by any Coast Guard-designated individual or any person legally permitted to administer oaths in the jurisdiction where the person taking the oath resides. Typically, if an oath is not administered by a designated Coast Guard official, it is administered by a notary public.^[20] When an individual applies for an MMC, the individual must complete Form CG-719B. They must either submit this form by email, in person, or send it by standard mail to an REC.^[21] Currently, if applicants use a notary public to administer their oath, the notary must sign the form along with the applicant. The signature of the applicant is a testament to the validity and accuracy of the information the individual is providing to the Coast Guard and is an attestation to the statements in Section 4, “Mariner's Consent/Certification,” of the form.

With this final rule, original applicants no longer need the signature ( printed page 102321) of the notary public on Form CG-719B. However, applicants will still need to sign the form, which alone is sufficient for Form CG-719B.

Currently, applicants for an original MMC who submit their application in person at an REC can also take the oath there. There is no cost to original applicants who take the oath before a designated official at an REC and therefore, no cost savings. However, original applicants, who do not visit an REC to submit their application, will need to seek the service of a notary public elsewhere.

Original applicants can obtain notary public service at a bank or another location where there are notary public services. The Coast Guard assumes there is no cost for a notary public service at a bank if an individual has a bank account there. Other establishments that provide legal services may also provide notary public services, in addition to State and local Government offices, including shipping companies.^[22] However, these offices and establishments usually charge for the public notary service.

Therefore, as mentioned previously in this RA, the Coast Guard presents two assumptions that will each generate different cost savings estimates for the change to § 10.225(c). With each assumption, the Coast Guard assumes all applicants who apply for an original MMC are currently employed:

• Assumption 1—Approximately 13,951 individuals who applied for an original MMC and took an oath before a designated official who administers the oath, or a notary public at a bank where they have an account free of charge.
• Assumption 2—Half the individuals, or approximately 6,976, who applied for an original MMC took an oath along with a notary public service at a bank, and half obtained an oath elsewhere (perhaps at a state office or an establishment that provides legal services including notary public services), where a cost is associated with the notary public service.

Earlier in this analysis, the Coast Guard established that one payment transaction represents one original application with one oath. Presumably, original applicants seek a notary public service at a bank, where it is free of charge; this is our basis for Assumption 1. However, because the Coast Guard does not have data on where original applicants obtained an oath along with a notary public service, it is possible that a certain number of original applicants obtained an oath along with a notary public service outside of a bank; this is our basis for Assumption 2. As such, the Coast Guard divided the population evenly in Assumption 2.

With the Coast Guard's assumption that original applicants who apply for MMCs are employed, this allows us to estimate the cost savings associated with the change to § 10.225(c) as we did for the change to § 10.219(d). Because original applicants who apply for MMCs are members of the general public and not yet mariners, the Coast Guard does not collect data on where these original applicants reside. Therefore, the Coast Guard does not know where original applicants reside relative to the location of banks or bank branches, or other establishments that offer notary public services. This required the Coast Guard to estimate the approximate distance original applicants travel to get to a bank branch for Assumption 1, so the Coast Guard is able to estimate the cost savings for them, because they no longer need to travel to a bank branch to obtain a notary public service. To perform this analysis, the Coast Guard required several pieces of information to determine the distance original applicants must travel to a bank or bank branch (and a notary public service in Assumption 2):

1. The number of bank branches in the United States;

2. The total U.S. population and the U.S. adult population; and

3. The number of square miles of the United States.

The St. Louis Federal Reserve Bank compiles and reports U.S. economic data (Federal Reserve Economic Data, or “FRED”). One of the data items it reports is the number of bank branches in the United States. FRED shows that there are 30.46 bank branches per 100,000 adults in the United States.^[23]

The U.S. Census Bureau in the U.S. Department of Commerce reports population data for the United States. As of July 1, 2023, the U.S. Census Bureau estimates the U.S. population to be approximately 334,914,895.^[24] The U.S. Census Bureau reports the number of individuals below the age of 18 to be 21.7 percent of the total U.S. population.^[25] Therefore, the number of adults in the United States (individuals who are 18 years of age or older) is approximately 262,238,363, rounded ((1−0.222) × 334,914,895). The Coast Guard divided this population by 100,000 to normalize the value to 100,000 (so it can be scaled to and combined with FRED's data) and obtained the value of approximately 2,622 (rounded).

To determine the number of bank branches for every adult in the U.S., the Coast Guard multiplied 30.46 (number of bank branches) by 2,622 to obtain approximately 79,866 (rounded) bank branches.

Finally, as of 2023, the U.S. Census Bureau's Quick Facts shows the number of square miles in the United States to be 3,533,038, rounded.^[26] The Coast Guard then divided this value by 79,866 bank branches to obtain the number of bank branches per square mile in the United States, or approximately one bank branch for every 44 square miles, or an area of 6.7 by 6.7 miles.^[27] This is equivalent to approximately one bank branch every 6.7 miles.^[28] The Coast ( printed page 102322) Guard acknowledges that this methodology may not be completely representative of the geographic distribution of bank branches in the United States (the distribution of bank branches may change in the future considering the steady decline in its numbers, particularly since 2010); the distance we estimated is an approximation based on the known statistics we present in this analysis from different sources. Table 8 outlines the inputs used in these calculations.

For this analysis, the Coast Guard assumed that 13,951 original applicants travel the same distance of 6.7 miles to obtain a notary public service at a bank or bank branch. Using these data and assumptions, it is possible to construct a cost savings analysis based on the original applicants' travel time to a bank branch to obtain the service of a notary public.

The population of original applicants applying for an MMC who seek notary public services outside of an REC is approximately 13,951 annually (see Table 3). The Coast Guard does not collect data on how original applicants travel to a bank or a notary public service and acknowledges that original applicants can choose among different modes of transportation, including walking or taking public transportation, to do so. However, for the purpose of this analysis, the Coast Guard assumed original applicants use their personal vehicles to accomplish this task, which allows the Coast Guard to estimate the travel cost for original applicants.

To construct this analysis for Assumptions 1 and 2, the Coast Guard assumed that 13,951 original applicants travel approximately 6.7 miles one way or about 13.4 miles round-trip to an establishment that has a notary public service. See table 9.

The Coast Guard shows the cost-saving elements for Assumption 1 and 2 in table 10. The Coast Guard estimated that the 13,951 original applicants affected by the change to § 10.225(c) save the travel time or labor cost for travel (the value of travel time savings or VTTS), the mileage cost, and the cost of time waiting at a bank or a notary public service.^[29] The Coast Guard included these cost savings in both Assumption 1 and 2.

Under Assumption 2, half of these original applicants, or about 6,976, also save the cost of the time it takes to complete a payment transaction, either by credit card or by cash, at a notary public service. The Coast Guard assumed half of these original applicants currently pay by credit card and half by cash, for about 3,488 original applicants choosing each payment method.

The Coast Guard acknowledges that there is a greater concentration of banks and establishments with notary public services in urban and metropolitan areas of the United States. Additionally, considering that the population density of urban areas is greater than in rural areas, it is likely that the population of original applicants is higher in urban areas than in rural areas of the United States. Therefore, it is likely that a ( printed page 102323) greater proportion of original applicants who apply for MMCs reside in urban and metropolitan areas and may travel shorter distances to reach these places, which will result in lower cost savings than the Coast Guard estimated in this analysis. Nevertheless, this analysis represents an analysis of averages because the Coast Guard does not know where original applicants who apply for MMCs reside. The Coast Guard acknowledges that bank branches (and notary public services) are not equally distributed in the United States; the travel distance of 6.7 miles we estimated in this analysis is an approximate distance to a bank branch or notary public service; the travel distance may vary for some applicants who reside in suburban and rural areas of the United States.

In addition to the two main assumptions for the change to § 10.225(c) that the Coast Guard presented earlier, we present a summary of the other assumptions (some of which we may have presented earlier in the analysis), that we included in the analysis for Assumptions 1 and 2:

1. Original applicants for an MMC are currently employed in another occupation;

2. Affected original applicants live approximately 6.7 miles from a bank branch or notary public;

3. Affected original applicants travel an equal distance of 6.7 miles to a bank branch or a notary public service;

4. The wait times and payment transaction times at bank branches and notary public are the same as wait times at an REC; and

5. Original applicants use their privately-owned vehicle to travel to a bank branch or a notary public service.

Cost Savings Analysis for Assumption 1 for the Change to § 10.225(c)

With Assumption 1, the Coast Guard assumed 13,951 original applicants currently obtain a notary public service for the purpose of the oath at a bank, where there is no charge for the service if original applicants have an account at the bank. Because the Coast Guard does not know where original applicants live in proximity to the location of bank branches, the Coast Guard assumed all 13,951 original applicants travel about 6.7 miles one-way or about 13.4 miles round-trip to a bank branch. Under this assumption, 13,951 original applicants save the labor travel time or VTTS, the mileage cost, and the time waiting at a bank branch to obtain a notary public signature on Form CG-719B under this final rule.^[30]

( printed page 102324)

To obtain the time it takes to travel this distance, the Coast Guard first accessed the Department of Transportation's (DOT) website to access the National Highway Traffic Safety Administration's (NHTSA) web page to obtain the mean road speeds on all roads.^[31] The 2015 report shows the free-flow speed estimates (mph) for three road classes: limited access, major arterial, and minor arterial roads/collector roads. The Coast Guard used the mean speed for the minor arterial/collector road class, which may be more representative of roads used by applicants. NHTSA estimates the mean speed for minor arterial/collector roads to be about 49.73 miles per hour (mph).^[32] The Coast Guard then divided the distance of about 6.7 miles (one way) by 49.73 mph to obtain the time it takes to travel this distance, or approximately 0.13 hours, rounded. The Coast Guard then divided the round-trip distance of about 13.4 miles by 49.73 mph to obtain the time it takes to travel this distance, or approximately 0.27 hours, rounded. The Coast Guard recognizes that an unknown portion of applicants, who live in urban areas, may travel at lower speeds than applicants in suburban and rural areas of the United States to get to a bank branch or notary public service. As a result, travel speeds may be lower than the 49.73 mph speed we estimated in this regulatory analysis.

With this information, the Coast Guard then calculated the labor cost for all original applicants who currently expend the time to travel this distance to obtain a notary public service. Earlier, the Coast Guard established the loaded mean hourly wage rate for original applicants who apply for an MMCs to be approximately $45.65 (recall that this labor rate is for original applicants who need to take an oath; it is different than the labor rate for the mandatory fee portion of this analysis). Using the value of 50 percent for the VTTS for personal time (see footnote number 32), the Coast Guard calculated the labor cost for the time to travel the 13.4-mile round-trip distance for one original applicant to be approximately $6.16 ($45.65 × 0.50 × 0.27 hours). Therefore, the Coast Guard estimates the total undiscounted labor travel time cost or VTTS, for 13,951 original applicants to be approximately $85,938 annually, rounded (13,951 original applicants × $6.16). Next, the Coast Guard calculated the mileage cost for these original applicants to travel the round-trip distance. The Coast Guard used the General Services Administration's (GSA) reimbursement rates for original applicants who use their privately-owned vehicles.^[33] The GSA reports the rate per mile to be $0.655 for calendar year 2023. Using the round-trip distance of 13.4 miles, the Coast Guard estimates the cost for one individual to make this trip to be approximately $8.78, rounded (13.4 miles × $0.655). The Coast Guard estimates the total undiscounted travel or mileage cost for 13,951 original applicants to be approximately $122,490 annually, rounded (13,951 original applicants × $8.78).

Lastly, the Coast Guard calculated the waiting time at a bank branch for 13,951 original applicants to obtain a notary public signature on Form CG-719B. Because the Coast Guard assumed that waiting times at RECs is similar to waiting times at bank branches, we used the same waiting time that we used for original applicants who wait to pay the fees at an REC, or approximately 3.5 minutes (readers should refer to the earlier discussion of this estimate), or 0.06 hours, rounded. The Coast Guard estimates the total undiscounted cost for 13,951 original applicants who currently wait at bank branches for a notary public service to be approximately $38,212 annually, rounded (13,951 × $45.65 × 0.06 hours).

The Coast Guard estimates the total undiscounted cost for 13,951 original applicants affected by the changes to § 10.225(c) and who currently travel to bank branches to obtain a free notary public service to be approximately $246,640 annually, rounded ($85,938 + $122,490 + $38,212). This estimate is for Assumption 1 of the analysis. Therefore, in this final rule, the Coast Guard estimates the total undiscounted cost savings to these original applicants, who no longer need to obtain notary public service at bank branches, to be approximately $246,640 annually, rounded. See table 11.

( printed page 102325)

The Coast Guard estimates the total discounted cost savings, under Assumption 1, over a 10-year period of analysis to be approximately $1.7 million, rounded, using a 7-percent discount rate. The Coast Guard estimates the annualized cost savings to be approximately $246,640, rounded, using a 7-percent discount rate. See table 12.

Cost Savings Analysis for Assumption 2 for the Change to § 10.225(c)

Because the Coast Guard does not collect data on where original applicants obtain a notary public service, with Assumption 2, the Coast Guard assumed half of the original applicants who currently apply for an MMC obtain a notary public service at a bank branch free of charge and half at a notary public, where there is a fee for the service. The half of the affected population who currently obtain a notary public service at a location other than a bank branch under this assumption consists of approximately 6,976 original applicants. As in Assumption 1, 13,951 original applicants travel the same distance of about 6.7 miles one-way or about 13.4 miles round-trip to a bank branch or a notary public service. For the time and the associated labor cost, it does not make a difference if these original applicants travel to a notary public service rather than a bank branch; they still incur the same labor cost for the travel time as in Assumption 1. The Coast Guard estimated earlier this total undiscounted labor cost, or labor travel time cost (VTTS), for 13,951 original applicants to be approximately $85,938 annually, rounded.

Similarly, these original applicants incur a mileage cost. As in Assumption 1, it does not make a difference if they travel to a notary public service rather than a bank branch; they still incur a mileage cost. The Coast Guard estimated earlier the total undiscounted travel or mileage cost, for 13,951 original applicants, to be approximately $122,490 annually, rounded.

Again, as in Assumption 1, 13,951 original applicants incur the cost to wait at a bank branch or a notary public service. The Coast Guard estimates the total undiscounted cost for 13,951 original applicants who currently wait at bank branches or at a notary public service to be approximately $38,212 annually, rounded.

With Assumption 2, the Coast Guard added the cost for half of the original applicants, or about 6,976, who pay for the notary public service outside of a bank branch. Similar to the payment of mandatory fees presented earlier, the Coast Guard assumed original applicants pay for a notary public with either a credit card or cash. For this analysis, the Coast Guard assumed half of the original applicants who currently pay for a notary public pay by credit card and half by cash. For the approximately 3,488 original applicants who currently pay by credit card, the Coast Guard used the same time estimate for this method of payment as we did for the payment of fees earlier, or approximately 0.13 hours (7.5 minutes each). The Coast Guard estimated the total undiscounted cost for these original applicants who currently pay by credit card to be approximately $20,700 annually, rounded (3,488 × $45.65 × 0.13).

The Coast Guard estimated the time for original applicants who currently pay by cash to be approximately 0.10 hours (6.0 minutes each). For the approximately 3,488 original applicants who currently pay by cash, the Coast Guard estimated the total undiscounted cost to be approximately $15,923 annually, rounded (3,488 × $45.65 × 0.10).

The last of the five cost elements for Assumption 2 (which are cost-saving elements with this final rule) is the cost for the notary public service itself. The Coast Guard obtained the cost for notary public services in the U.S. from the organization National Notary ( NationalNotary.org). Readers should ( printed page 102326) refer to footnote 11 for more information. This organization provides cost data for 2024 for notary public services throughout the United States, including Washington DC and U.S. territories.

The Coast Guard included fees from all 50 states and Washington DC in this analysis.^[34] Because the organization provides a fee schedule for verbal oaths, the Coast Guard used these fees as a proxy for the signature of the notary public on Form CG719B. The fee varies from state to state with the lowest amount being $2 and the highest $25. Ten states do not have a fee schedule or do not charge a fee altogether; nevertheless, the Coast Guard took the statistical average of the fees for all 50 states and Washington, DC, for an average amount of approximately $6.16, rounded. Therefore, the Coast Guard estimates the total undiscounted cost for original applicants in this assumption who pay for a notary public service to be approximately $42,970 annually, rounded (6,976 × $6.16).

The Coast Guard estimates the total undiscounted cost for original applicants in Assumption 2 for the changes to § 10.225(c) in this final rule to be approximately $326,232 annually, rounded ($85,938 + $122,490 + $38,212 + $20,700 + $15,923 + $42,970). Therefore, the Coast Guard estimates the total undiscounted cost savings to original applicants who no longer need to obtain a notary public service at bank branches or notary public services to be approximately $326,232 annually, rounded. See table 13.

The Coast Guard estimates the total discounted cost savings under Assumption 2 over a 10-year period of analysis to be approximately $2.3 million, rounded, using a 7-percent discount rate. The Coast Guard estimated the annualized cost savings to be approximately $326,232, rounded, using a 7-percent discount rate. See table 14.

( printed page 102327)

As noted earlier, the cost savings that the Coast Guard estimated for Assumptions 1 and 2 for the change to § 10.225(c) do not include the cost savings from the change to § 10.219(d). However, in table 1 of this RA, where we present the total cost savings estimates of the final rule, the Coast Guard included the cost savings estimates for the change to § 10.219(d), because the Coast Guard must add the cost savings from § 10.225(c) to the cost savings estimate for § 10.219(d). Also recall that only one of the two main assumptions of this analysis will hold. The Coast Guard presented two different scenarios, because we do not know where affected original applicants currently obtain a notary public service.

For Assumption 1 and including the cost savings estimates from the change to § 10.219(d), the Coast Guard estimates the total undiscounted cost savings of the final rule to be approximately $387,959 annually, rounded ($246,640 from Assumption 1 and § 10.225(c) + $141,320 from § 10.219(d)). The Coast Guard estimated the 10-year total discounted cost savings of the final rule to be approximately $2.7 million, rounded, using a 7-percent discount rate. The Coast Guard estimated the annualized cost savings to be approximately $387,959, rounded, using a 7-percent discount rate. See table 15.

( printed page 102328)

Readers should compare the total cost savings estimate and annualized cost savings estimate for the final rule in table 15 with the total cost savings estimate of the final rule for Assumption 1 in table 1.

For Assumption 2 and including the cost savings estimates from the change to § 10.219(d), the Coast Guard estimates the total undiscounted cost savings of the final rule to be approximately $467,552 annually, rounded ($326,232 from Assumption 2 and § 10.225(c) + $141,320 from § 10.219(d)). The Coast Guard estimates the 10-year total discounted cost savings of the final rule for Assumption 2 to be approximately $3.3 million, rounded, using a 7-percent discount rate. The Coast Guard estimates the annualized cost savings to be approximately $467,552, rounded, using a 7-percent discount rate. See table 16.

( printed page 102329)

Readers should compare the total cost savings estimate and annualized cost savings estimate for the final rule in table 16 with the total cost savings estimate of the final rule for Assumption 2 in table 1.

Including Federal Government cost savings, the Coast Guard estimates the 10-year total discounted cost savings of the final rule under Assumption 1 to be about $2.96 million ($2,724,864 from table 15 and $230,491 from table 7), rounded, using a 7-percent discount rate. We estimate the annualized cost savings to be approximately $420,776, rounded, using a 7-percent discount rate ($387,959 from table 15 + $32,817 from table 7). See table 17.

Including Federal Government cost savings, the Coast Guard estimates the 10-year total discounted cost savings of the final rule under Assumption 2 to be about $3.5 million ($3,283,889 from table 16 and $230,491 from table 7), rounded, using a 7-percent discount rate. We estimate the annualized cost savings to be approximately $500,369, rounded, using a 7-percent discount rate ($467,552 from table 16 + $32,817 from table 7). See table 17.

Unquantifiable Benefits of the Final Rule

This final rule creates unquantifiable benefits for MMC applicants. This includes the flexibility to submit documents electronically; the changes are contained in §§ 1.03-15(h)(2)(i) and 10.219(i)(1). Because this is an option in the future, the Coast Guard does not have data at this point to estimate the cost savings that are associated with the electronic submission of documents, if applicants were to choose this option.

The use of Pay.gov provides a benefit to applicants because it is a free and ( printed page 102330) secure service that allows applicants to make payments to most Federal Government agencies. Pay.gov uses the latest industry-standard payment methods and encryption technology to safely collect, store, transmit, and protect applicants' personal information throughout the payment process. Applicants can access and make payments through Pay.gov 24 hours a day, 7 days a week, and every day of the year, including holidays.

In table 2, the Coast Guard lists the unquantifiable benefits where the regulatory text changes are more than minor grammatical changes.

Analysis of Alternatives

(1) Industry would continue to meet the current requirements in subchapter A, part 1 and subchapter B, parts 10-16 of title 46 of the CFR (current baseline without regulatory action).

This alternative represents the current state of the MCP with no updates to 46 CFR subchapter A, part 1 and subchapter B, parts 10-16. The Coast Guard rejected this alternative, because it does not require that applicants pay mandatory fees electronically through Pay.gov. This alternative maintains all the current, estimated, undiscounted costs between $246,640 and $326,232 annually, rounded (see the estimated costs under Assumptions 1 and 2, respectively, in the preferred alternative). The Coast Guard also continues to request applicants provide receipt of payment when using Pay.gov (for example, attach receipt to applications and provide receipt for MCP services) although this is not required. Applicants still have the option of paying mandatory fees in person at an REC through cash, check, credit card, and money order. Although in-person payments remain an option, these applicants would not realize potential cost savings by using Pay.gov. In-person and standard mail payments made by applicants maintain the options that currently exist, which some applicants may find more convenient (for in-person payments, perhaps as a customer service benefit) over payments by electronic means. This alternative would also not result in time and cost savings to original applicants, who would still be required to take an oath before an authorized individual. Additionally, this alternative would not clarify existing regulatory text.

(2) The Coast Guard would update regulatory requirements to align with a new MCP IT system and update mandatory fees with an incentive for electronic payment.

With this alternative, the Coast Guard would replace the current MMLD database and would propose changes to 46 CFR parts 10 through 14 and 16 to increase electronic submission of documents to support the credentialing process. With this alternative, the Coast Guard would provide an incentive to applicants to electronically pay mandatory fees through Pay.gov. It would be beneficial to applicants, who would save time and money; however, the Coast Guard is unable to estimate a cost savings for this item under this alternative because it would require a lengthy analysis of the Coast Guard's mandatory fee program.

The Coast Guard rejected this alternative because the update would require additional regulatory action to allow for future changes in the system, and any changes to mandatory fees would require further study and analysis by the Coast Guard, which would require the use of limited additional time and resources.

(3) The Coast Guard would update regulatory requirements to align with a new MCP IT system and require electronic payment but would not address mandatory fees.

With this alternative, the Coast Guard would not update the mandatory fees together with the requirement for the electronic payment of fees by individuals through a new MCP IT system. However, the Coast Guard kept the requirement under the preferred alternative (final rule) for the electronic payment of fees by applicants saving them approximately $141,320 annually, rounded (see the analysis for the preferred alternative for the derivation of this estimate), because it would not be connected to a new MCP IT system.

The Coast Guard rejected this alternative because the new system is at the beginning stages of development, and, as a result, the Coast Guard is unable to estimate the economic impact of this new system on applicants and companies. Therefore, the Coast Guard cannot accurately determine any adjustments to mandatory fees based on the new system's capabilities, potential costs to support the system, or cost savings generated from the system.

(4) Preferred Alternative—Update 46 CFR subchapter A, part 1 and subchapter B, parts 10-16 to update regulatory requirements to align with a new MCP IT system, require the electronic payment of fees and the option of electronic submission of supporting documents for an MMC application, remove the requirement for an oath to be administered by an authorized individual, and make editorial and non-substantive changes that clarify existing regulatory text.

We selected this preferred alternative because with this final rule, applicants will be required to pay mandatory fees electronically using Pay.gov, which will result in cost savings to them from not having to visit RECs in person. Additionally, applicants will benefit from this final rule because it will create an option for the electronic submission of certain documents in §§ 1.03-15(h)(2)(i) and 10.219(i)(1). However, it should be noted that this preferred alternative removes the flexibility for applicants who wish to continue to pay the mandatory fees in person. We analyzed the time and cost difference between the different payment methods and the requirement to use Pay.gov previously in this regulatory analysis.

This alternative also aligns with Department of Treasury regulations for promoting efficient, effective cash management through improved billing, collection, deposit, and payment of funds. The Coast Guard also removes the requirement for an oath to be taken by original applicants when they submit their MMC application. This saves time and money for original applicants who no longer need to travel to a bank or a bank branch or a notary public service to have the oath administered. Lastly, the Coast Guard makes numerous editorial changes to the affected CFR subchapters that clarify existing regulatory text. The Coast Guard analyzed and presented the cost savings and other unquantifiable benefits associated with this alternative earlier in this RA.

B. Small Entities

Under the Regulatory Flexibility Act (RFA), 5 U.S.C. 601-612, we have considered whether this final rule has a significant economic impact on a substantial number of small entities. The term “small entities” comprises small businesses, not-for-profit organizations that are independently owned and operated and are not dominant in their fields, and governmental jurisdictions with populations of less than 50,000.

Based on the analysis in Section A, Regulatory Planning and Review, we found this final rule does not have a significant economic impact on a substantial number of small entities. The provisions of this final rule, which have an economic impact, affect individuals who apply for an MMC and do not directly regulate small entities. These include provisions that require electronic payment of merchant mariner credentialing fees in § 10.219(d), remove the requirement for an oath to be administered by an authorized official on Form CG-719B in § 10.225(c), and ( printed page 102331) allow for the electronic submission of certain documents in § 1.03-15(h)(2)(i) for appeals involving course approvals and merchant mariner personnel issues and in § 10.219(i) for requests involving no-fee MMCs. Since individual members of the public that are applying for MMCs are not considered to be small entities under the RFA, we have found that no small entities are impacted by these provisions of the final rule.

Therefore, the Coast Guard certifies under 5 U.S.C. 605(b) that this final rule will not have a significant economic impact on a substantial number of small entities because based on our analysis, the provisions of the final rule that have an economic impact (which also include editorial changes) affect applicants and do not directly regulate or affect small entities. The changes we made to all of the remaining provisions are editorial in nature (see table 4 in Section V, Regulatory Analysis, for a list of these changes).

C. Assistance for Small Entities

Under section 213(a) of the Small Business Regulatory Enforcement Fairness Act of 1996, Public Law 104-121, we offer to assist small entities in understanding this final rule so that they can better evaluate its effects on them and participate in the rulemaking. The Coast Guard will not retaliate against small entities that question or complain about this final rule or any policy or action of the Coast Guard.

Small businesses may send comments on the actions of Federal employees who enforce, or otherwise determine compliance with, Federal regulations to the Small Business and Agriculture Regulatory Enforcement Ombudsman and the Regional Small Business Regulatory Fairness Boards. The Ombudsman evaluates these actions annually and rates each agency's responsiveness to small business. If you wish to comment on actions by employees of the Coast Guard, call 1-888-REG-FAIR (1-888-734-3247).

D. Collection of Information

The Paperwork Reduction Act of 1995 (44 U.S.C. 3507(d)) requires the U.S. Coast Guard to consider the impact of paperwork and other information collection burdens imposed on the public. According to the 1995 amendments to the Paperwork Reduction Act, an agency may not collect or sponsor the collection of information, nor may it impose an information collection requirement unless it displays a currently valid OMB control number.

The Coast Guard has determined that the final rule will not result in a new collection nor modify an existing collection of information. Thus, this final rule does not change the burden, number of respondents, or number of responses in the collections currently approved by OMB under OMB Control Numbers 1625-0012 with a title of “Certificate of Discharge to Merchant Mariners” and 1625-0040 with a title of “Applications for Merchant Mariners Credentials and Medical Certificates.”

E. Federalism

A rule has implications for federalism under Executive Order 13132 (Federalism) if it has a substantial direct effect on States, on the relationship between the National Government and the States, or on the distribution of power and responsibilities among the various levels of government. We have analyzed this rule under Executive Order 13132 and have determined that it is consistent with the fundamental federalism principles and preemption requirements described in Executive Order 13132. Our analysis follows.

It is well settled that States may not regulate in categories reserved for regulation by the Coast Guard. It is also well settled that all of the categories covered in 46 U.S.C. 3306, 3703, 7101, and 8101 (design, construction, alteration, repair, maintenance, operation, equipping, personnel qualification, and manning of vessels), as well as the reporting of casualties and any other category in which Congress intended the Coast Guard to be the sole source of a vessel's obligations, are within the field foreclosed from regulation by the States. See the Supreme Court's decision in United States v. Locke and Intertanko v. Locke, 529 U.S. 89, 120 S.Ct. 1135 (2000). Therefore, because the States may not regulate within these categories, this rule is consistent with the fundamental federalism principles and preemption requirements described in Executive Order 13132.

F. Unfunded Mandates

The Unfunded Mandates Reform Act of 1995, 2 U.S.C. 1531-1538, requires Federal agencies to assess the effects of their discretionary regulatory actions. In particular, the Act addresses actions that may result in the expenditure by a State, local, or tribal government, in the aggregate, or by the private sector of $100,000,000 (adjusted for inflation) or more in any one year. Although this rule will not result in such expenditure, we do discuss the effects of this rule elsewhere in this preamble.

G. Taking of Private Property

This rule will not cause a taking of private property or otherwise have taking implications under Executive Order 12630 (Governmental Actions and Interference with Constitutionally Protected Property Rights).

H. Civil Justice Reform

This rule meets applicable standards in sections 3(a) and 3(b)(2) of Executive Order 12988 (Civil Justice Reform) to minimize litigation, eliminate ambiguity, and reduce burden.

I. Protection of Children

We have analyzed this rule under Executive Order 13045 (Protection of Children from Environmental Health Risks and Safety Risks). This rule is not an economically significant rule and will not create an environmental risk to health or risk to safety that might disproportionately affect children.

J. Indian Tribal Governments

This rule does not have tribal implications under Executive Order 13175 (Consultation and Coordination with Indian Tribal Governments), because it will not have a substantial direct effect on one or more Indian tribes, on the relationship between the Federal Government and Indian tribes, or on the distribution of power and responsibilities between the Federal Government and Indian tribes.

K. Energy Effects

We have analyzed this rule under Executive Order 13211 (Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use). We have determined that it is not a “significant energy action” under that order because it is not a “significant regulatory action” under Executive Order 12866 and is not likely to have a significant adverse effect on the supply, distribution, or use of energy. We have determined that it is not a “significant energy action” under Executive Order 13211, because although it is a “significant regulatory action” under Executive Order 12866, it is not likely to have a significant adverse effect on the supply, distribution, or use of energy, and the Administrator of OMB's Office of Information and Regulatory Affairs has not designated it as a significant energy action.

L. Technical Standards and Incorporation by Reference

The National Technology Transfer and Advancement Act, codified as a note to 15 U.S.C. 272, directs agencies to use voluntary consensus standards in ( printed page 102332) their regulatory activities unless the agency provides Congress, through OMB, with an explanation of why using these standards would be inconsistent with applicable law or otherwise impractical. Voluntary consensus standards are technical standards (for example, specifications of materials, performance, design, or operation; test methods; sampling procedures; and related management systems practices) that are developed or adopted by voluntary consensus standards bodies.

This rule does not use technical standards. Therefore, we did not consider the use of voluntary consensus standards.

M. Environment

We have analyzed this rule under Department of Homeland Security Management Directive 023-01, Rev. 1, associated implementing instructions, and Environmental Planning COMDTINST 5090.1 (series), which guide the Coast Guard in complying with the National Environmental Policy Act of 1969 (42 U.S.C. 4321-4370f), and have made a determination that this action is one of a category of actions that do not individually or cumulatively have a significant effect on the human environment. A Record of Environmental Consideration supporting this determination is available in the docket. For instructions on locating the docket, see the ADDRESSES section of this preamble. This final rule is categorically excluded under paragraphs L54 and L56 of Appendix A, Table 1 of DHS Instruction Manual 023-01-001-01, Rev. 1. Paragraph L54 pertains to regulations that are editorial or procedural. Paragraph L56 pertains to regulations concerning the training, qualifying, licensing, and disciplining of maritime personnel.

This final rule involves regulatory changes that are needed for implementation of a new information technology system that will replace the current MMLD database used by the Coast Guard to process mariner credentials. This new system features an electronic platform for activities such as mariners providing documents for applying for or maintaining mariner credentials, or submitting associated fees. In addition, the rule includes technical amendments, such as updates, to addresses and websites necessary for accessing or using MMLD.

For the reasons discussed in the preamble, the Coast Guard is amending 46 CFR parts 1, 10, 11, 12, 13, 14, 15, and 16 as follows: