Technology Innovation Program FRN

Federal Register / Vol. 73, No. 46 / Friday, March 7, 2008 / Proposed Rules
The Proposed Amendment
Accordingly, under the authority
delegated to me by the Administrator,
the FAA proposes to amend 14 CFR part
39 as follows:
PART 39—AIRWORTHINESS
DIRECTIVES
1. The authority citation for part 39
continues to read as follows:
Authority: 49 U.S.C. 106(g), 40113, 44701.
§ 39.13

[Amended]

2. The FAA amends § 39.13 by adding
the following new AD:
Bell Helicopter Textron Canada: Docket No.
FAA–2008–0258; Directorate Identifier 2007–
SW–22–AD.
Comments Due Date
(a) We must receive comments by April 7,
2008.
Other Affected ADs
(b) None.
Applicability
(c) This AD applies to Models 206L, 206L–
1, 206L–3, and 206L–4 with horizontal
stabilizer, part number (P/N) 206–023–119–
167, and Model 407 with horizontal
stabilizer, P/N 407–023–801–109, installed,
certificated in any category.

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Reason
(d) The mandatory continuing
airworthiness information (MCAI) states:
Horizontal stabilizers part numbers 206–
023–119–167 and 407–023–801–109 may
have manufacturing flaws on the inside
surface of the upper and/or lower skin at the
tailboom attachment inserts. These flaws may
result in cracking of the skin and failure of
the horizontal stabilizer.
The manufacturer’s service information
states that in addition to cracks, the
horizontal stabilizer may have deformation or
debonding around and between the inserts.
The proposed AD would require actions that
are intended to address all these unsafe
conditions.
Actions and Compliance
(e) Within the next 100 hours time-inservice (TIS) or 30 days, whichever occurs
first, unless done previously.
(1) Determine whether you have an
affected serial numbered horizontal stabilizer
installed by removing the elevators from the
horizontal stabilizer. Access the horizontal
stabilizer identification tag containing the
horizontal stabilizer serial number as shown
in Figure 1 and remove the elevators by
following the Accomplishment Instructions,
Part I, of Bell Helicopter Textron Canada
(BHTC) Alert Service Bulletin (ASB) No.
206L–06–141, dated September 12, 2006,
applicable to the Model 206L series
helicopter (206L ASB) or BHTC ASB No.
407–06–72, dated September 12, 2006,
applicable to the Model 407 helicopters (407
ASB).
(2) If the serial number on the
identification tag is a serial number listed in

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Table 1 of the 206L ASB or 407 ASB, inspect
the horizontal stabilizer as follows:
(i) Using a 10x or higher magnifying glass,
inspect the horizontal stabilizer for a crack or
deformation around the areas of the inserts.
Also, using a tap test method, inspect for
debonding between the inserts by following
the Accomplishment Instructions, Part II, of
either the 206L ASB or 407 ASB, as
applicable.
(ii) If you find a crack, deformation, or
debonding, replace the horizontal stabilizer
with an airworthy horizontal stabilizer that
does not have a serial number listed in Table
1 of the 206L ASB or 407 ASB. Replace the
horizontal stabilizer by following the
Accomplishment Instructions, Part III, of
either the 206L ASB or the 407 ASB, as
applicable.
(iii) If you do not find a crack, deformation,
or debonding, thereafter, at intervals not to
exceed 600 hours TIS or during each annual
inspection, whichever occurs first, repeat the
inspection required by paragraph (e)(2)(i) of
this AD.
(f) Replacing any horizontal stabilizer
containing a serial number listed in Table 1
of 206L ASB or 407 ASB with a horizontal
stabilizer that does not contain such a serial
number by following the Accomplishment
Instructions, Part III, of either the 206L ASB
or 407 ASB, as applicable, constitutes
terminating actions for the requirements of
this AD.
Differences Between the FAA AD and the
MCAI
(g) The MCAI requires compliance ‘‘within
the next 100 hours air time but no later than
9 May 2007.’’ This AD requires compliance
within the next 100 hours TIS or 30 days,
whichever occurs first, unless done
previously. Also, the MCAI requires
replacing the horizontal stabilizer by
September 30, 2008, and we have not
mandated a compliance time for replacing
the horizontal stabilizer.
Subject
(h) Air Transport Association of America
(ATA) Code: 5510 Horizontal Stabilizer
Structure.
Other Information
(i) The following provisions also apply to
this AD:
(1) Alternative Methods of Compliance
(AMOCs): The Manager, Safety Management
Group, FAA, has the authority to approve
AMOCs for this AD, if requested using the
procedures found in 14 CFR 39.19. Send
information to ATTN Sharon Miles, Aviation
Safety Engineer, FAA, Rotorcraft Directorate,
Regulations and Guidance Group, Fort
Worth, Texas 76193–0111, telephone (817)
222–5122, fax (817) 222–5961.
(2) Airworthy Product: Use only FAAapproved corrective actions. Corrective
actions are considered FAA-approved if they
are approved by the State of Design Authority
(or their delegated agent) if the State of
Design has an appropriate bilateral agreement
with the United States. You are required to
assure the product is airworthy before it is
returned to service.
(3) Reporting Requirements: For any
reporting requirement in this AD, under the

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provisions of the Paperwork Reduction Act,
the Office of Management and Budget (OMB)
has approved the information collection
requirements and has assigned OMB Control
Number 2120–0056.
Related Information
(j) MCAI Transport Canada Airworthiness
Directive No. CF–2007–03, dated March 27,
2007, contain related information.
Issued in Fort Worth, Texas, on February
28, 2008.
Mark R. Schilling,
Acting Manager, Rotorcraft Directorate,
Aircraft Certification Service.
[FR Doc. E8–4495 Filed 3–6–08; 8:45 am]
BILLING CODE 4910–13–P

DEPARTMENT OF COMMERCE
National Institute of Standards and
Technology
15 CFR Part 296
[Docket No: 071106659–7661–01]
RIN 0693–AB59

Technology Innovation Program
National Institute of Standards
and Technology, United States
Department of Commerce.
ACTION: Notice of proposed rulemaking;
request for comments.
AGENCY:

SUMMARY: The Director of the National
Institute of Standards and Technology
(NIST), United States Department of
Commerce, requests comments on
proposed regulations which implement
the Technology Innovation Program
(TIP). The proposed rule prescribes
policies and procedures for the award of
financial assistance (grants and/or
cooperative agreements) under TIP. In
addition, NIST is revising the heading of
Subchapter K of its regulations to
accurately reflect the current contents of
that subchapter.
DATES: Comments must be received no
later than April 21, 2008.
ADDRESSES: Comments on the proposed
regulations must be submitted in
writing to: National Institute of
Standards and Technology, Technology
Innovation Program NPRM, 100 Bureau
Drive, Mail Stop 4700, Gaithersburg,
MD 20899–4700, or via the Federal eRulemaking Portal:
www.regulations.gov. Follow the
instructions for submitting comments.
FOR FURTHER INFORMATION CONTACT:
Barbara Lambis via e-mail at
[email protected] or telephone
(301) 975–4447.
SUPPLEMENTARY INFORMATION: The
America Creating Opportunities to

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Federal Register / Vol. 73, No. 46 / Friday, March 7, 2008 / Proposed Rules

Meaningfully Promote Excellence in
Technology, Education, and Sciences
(COMPETES) Act, Public Law 110–69,
was enacted on August 9, 2007, to
invest in innovation through research
and development and to improve the
competitiveness of the United States.
Section 3012 of the COMPETES Act
established TIP for the purpose of
assisting United States businesses and
institutions of higher education or other
organizations, such as national
laboratories and nonprofit research
institutions, to support, promote, and
accelerate innovation in the United
States through high-risk, high-reward
research in areas of critical national
need. High-risk, high-reward research is
research that has the potential for
yielding transformational results with
far-ranging or wide-ranging
implications; addresses areas of critical
national need that support, promote,
and accelerate innovation in the United
States and is within NIST’s areas of
technical competence; and is too novel
or spans too diverse a range of
disciplines to fare well in the traditional
peer review process. Section 3012(f) of
the America COMPETES Act requires
the NIST Director to promulgate
regulations implementing the TIP.
This notice solicits comments on
proposed regulations for the TIP. When
the comment period is concluded, NIST
will analyze the comments received,
incorporate comments as appropriate,
and publish the final regulation.
Examples of NIST’s technical
competencies are summarized on the
NIST Web site at http://www.nist.gov/
public_affairs/labs2.htm. However, this
summary is not exhaustive and may not
include all competencies required for
NIST to respond to the diverse industry
needs for measurement methods, tools,
data, technology and standard reference
materials. NIST competencies evolve as
the recognition for the needs of
measurement science in that area
evolves. NIST competencies are more
expansive than just the physical and
engineering sciences. NIST translates its
physical and engineering science
competencies to meet the needs of
emerging areas where scientific
boundaries are advancing.
For each TIP competition, the
Program will solicit proposals through
an announcement in the Federal
Register. The notices will include a
description of the areas of critical
national need that will be addressed in
that competition. Critical national need
areas are those for which government
attention is demanded because the
magnitude of the problem is large and
the societal challenges that need to be
overcome are not being addressed. In

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determining which areas of critical
national need will be addressed in a
competition, TIP may solicit input from
within NIST, from the TIP Advisory
Board, and from the public. Information
about the TIP Advisory Board may be
found on the TIP Web site at http://
www.nist.gov/tip. TIP may engage
experts in scientific and technology
policy to ensure that the areas of critical
national need that will be considered
are those that entail significant societal
challenges that are not already being
addressed by others and could be
addressed through high-risk, highreward research. Specific societal
challenges within selected areas of
critical national need will be the focus
of TIP funding.
In addition to information provided in
the Federal Register announcement, TIP
will post a Federal Funding
Opportunity at the Grants.gov Web site
at www.Grants.gov. TIP may also
communicate information about the
Program and the competition through
means such as the publication of the
Proposal Preparation Kit, public
meetings, and posting information on
the Program’s Web site at http://
www.nist.gov/tip. NIST notes the
proposed rule, in section 296.22,
requires that proposals must
demonstrate that reasonable and
thorough efforts have been made to
secure funding from alternative funding
sources and no other alternative funding
sources are reasonably available. NIST
seeks comment on how it should
determine if such efforts have been
made, what criteria NIST should
examine in determining the
reasonableness and thoroughness of
such efforts, and what demonstrations
applicants must make to satisfy such
criteria.
In addition, NIST is revising the
heading of Subchapter K of its
regulations to accurately reflect the
current contents of that subchapter. The
current heading of Subchapter K is
‘‘Advanced Technology Program,’’ but
the subchapter contains regulations
pertaining to that Program, the Hollings
Manufacturing Extension Partnership
Program, and now the TIP. The new
heading of Subchapter K will be ‘‘NIST
Extramural Programs.’’
Request for Public Comment: Persons
interested in commenting on the
proposed regulations should submit
their comments in writing to the above
address. All comments received in
response to this notice will become part
of the public record and will be
available for inspection and copying at
the Department of Commerce Central
Reference and Records Inspection

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Facility, Room 6228, Herbert C. Hoover
Building, Washington, DC 20230.
Additional Information
Executive Order 12866
This rulemaking is a significant
regulatory action under Sections 3(f)(3)
and 3(f)(4) of Executive Order 12866, as
it materially alters the budgetary impact
of a grant program and raises novel
policy issues. This rulemaking,
however, is not an ‘‘economically
significant’’ regulatory action under
Section 3(f)(1) of the Executive Order, as
it does not have an effect on the
economy of $100 million or more in any
one year, and it does not have a material
adverse effect on the economy, a sector
of the economy, productivity,
competition, jobs, the environment,
public health or safety, or State, local,
or tribal governments or communities.
Executive Order 13132
This rule does not contain policies
with Federalism implications as defined
in Executive Order 13132.
Regulatory Flexibility Act
Because notice and comment are not
required under 5 U.S.C. 553, or any
other law, the analytical requirements of
the Regulatory Flexibility Act (5 U.S.C.
601 et seq.) are inapplicable. As such, a
regulatory flexibility analysis is not
required, and none has been prepared.
Paperwork Reduction Act
Notwithstanding any other provision
of the law, no person is required to, nor
shall any person be subject to penalty
for failure to comply with, a collection
of information, subject to the
requirements of the Paperwork
Reduction Act, unless that collection of
information displays a currently valid
Office of Management and Budget
(OMB) Control Number.
This proposed rule does not contain
collection of information requirements
subject to review and approval by OMB
under the Paperwork Reduction Act
(PRA). The TIP Proposal Preparation
Kit, which contains all necessary forms
and information requirements, will be
submitted to OMB for approval. The
OMB Control Number for the
information collection requirements
will be published in all Federal Register
notices soliciting proposals under the
Program.
National Environmental Policy Act
This rule will not significantly affect
the quality of the human environment.
Therefore, an environmental assessment
or Environmental Impact Statement is
not required to be prepared under the

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Federal Register / Vol. 73, No. 46 / Friday, March 7, 2008 / Proposed Rules
National Environmental Policy Act of
1969.
List of Subjects in 15 CFR Part 296
Business and industry; grant
programs—science and technology;
Inventions and patents; Reporting and
recordkeeping requirements; Research;
Science and technology.
Dated: March 3, 2008.
Richard F. Kayser,
Acting Deputy Director.

For reasons set forth in the preamble,
under the authority of 15 U.S.C. 278n
(Pub. L. 110–69 section 3012), it is
proposed that title 15 of the Code of
Federal Regulations be amended as
follows:
1. The heading of chapter II,
subchapter K is revised to read as
follows:
Subchapter K—NIST Extramural Programs

2. In 15 CFR chapter II, subchapter K,
add a new part 296 as follows:
PART 296—TECHNOLOGY
INNOVATION PROGRAM
Subpart A—General
Sec.
296.1 Purpose.
296.2 Definitions.
296.3 Types of assistance available.
296.4 Limitations on assistance.
296.5 Eligibility requirements for
companies and joint ventures.
296.6 Valuation of transfers.
296.7 Joint venture registration.
296.8 Joint venture agreement.
296.9 Activities not permitted for joint
ventures.
296.10 Third party in-kind contribution of
research services.
296.11 Intellectual property rights.
296.12 Reporting and auditing
requirements.
Subpart B—The Competition Process
296.20 The Selection process.
296.21 Evaluation criteria.
296.22 Award criteria.
Subpart C—Monitoring, Evaluation and
Dissemination of Program Results
296.30 Monitoring and evaluation.
296.31 Dissemination of results.
296.32 Technical and educational services.
296.33 Annual report.
Authority: 15 U.S.C. 278n (Pub. L.110–69
section 3012).

Subpart A—General

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296.1

Purpose.

(a) The purpose of the Technology
Innovation Program (TIP) is to assist
United States businesses and
institutions of higher education or other
organizations, such as national
laboratories and nonprofit research
institutes, to support, promote, and

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accelerate innovation in the United
States through high-risk, high-reward
research in areas of critical national
need within NIST’s areas of technical
competence.
(b) The rules in this part prescribe
policies and procedures for the award
and administration of financial
assistance (grants and/or cooperative
agreements) under the TIP. While the
TIP is authorized to enter into grants,
cooperative agreements, and contracts to
carry out the TIP mission, the rules in
this part address only the award of
grants and/or cooperative agreements.
296.2

Definitions.

(a) The term award means Federal
financial assistance made under a grant
or cooperative agreement.
(b) The term business or company
means a for-profit organization,
including sole proprietors, partnerships,
limited liability companies (LLCs), and
corporations.
(c) The term contract means a
procurement contract under an award or
subaward, and a procurement
subcontract under a recipient’s or
subrecipient’s contract.
(d) The term contractor means the
legal entity to which a contract is made
and which is accountable to the
recipient, subrecipient, or contractor
making the contract for the use of the
funds provided.
(e) The term cooperative agreement
refers to a Federal assistance instrument
used whenever the principal purpose of
the relationship between the Federal
government and the recipient is to
transfer something of value, such as
money, property, or services to the
recipient to accomplish a public
purpose of support or stimulation
authorized by Federal statute instead of
acquiring (by purchase, lease, or barter)
property or services for the direct
benefit or use of the Federal
government; and substantial
involvement is anticipated between the
Federal government and the recipient
during performance of the contemplated
activity.
(f) The term critical national need
means an area that demands
government attention because the
magnitude of the problem is large and
the societal challenges that need to be
overcome are not being addressed, but
could be addressed through high-risk,
high-reward research.
(g) The term direct costs means costs
that can be identified readily with
activities carried out in support of a
particular final objective. A cost may
not be allocated to an award as a direct
cost if any other cost incurred for the
same purpose in like circumstances has

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been assigned to an award as an indirect
cost. Because of the diverse
characteristics and accounting practices
of different organizations, it is not
possible to specify the types of costs
which may be classified as direct costs
in all situations. However, typical direct
costs could include salaries of personnel
working on the TIP project, travel,
equipment, materials and supplies,
subcontracts, and other costs not
categorized in the preceding examples.
NIST shall determine the allowability of
direct costs in accordance with
applicable Federal cost principles.
(h) The term Director means the
Director of the National Institute of
Standards and Technology (NIST).
(i) The term eligible company means
a small-sized or medium-sized business
or company that satisfies the ownership
and other requirements stated in this
part.
(j) The term grant means a Federal
assistance instrument used whenever
the principal purpose of the relationship
between the Federal government and
the recipient is to transfer something of
value, such as money, property, or
services to the recipient to accomplish
a public purpose of support or
stimulation authorized by Federal
statute instead of acquiring (by
purchase, lease, or barter) property or
services for the direct benefit or use of
the Federal government; and no
substantial involvement is anticipated
between the Federal government and
the recipient during performance of the
contemplated activity.
(k) The term high-risk, high-reward
research means research that:
(1) has the potential for yielding
transformational results with far-ranging
or wide-ranging implications;
(2) addresses areas of critical national
need that support, promote, and
accelerate innovation in the United
States and is within NIST’s areas of
technical competence; and
(3) is too novel or spans too diverse
a range of disciplines to fare well in the
traditional peer-review process.
(l) The term indirect costs means
those costs incurred for common or joint
objectives that cannot be readily
identified with activities carried out in
support of a particular final objective. A
cost may not be allocated to an award
as an indirect cost if any other cost
incurred for the same purpose in like
circumstances has been assigned to an
award as a direct cost. Because of
diverse characteristics and accounting
practices it is not possible to specify the
types of costs which may be classified
as indirect costs in all situations.

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However, typical examples of indirect
costs include general administration
expenses, such as the salaries and
expenses of executive officers,
personnel administration, maintenance,
library expenses, and accounting. NIST
shall determine the allowability of
indirect costs in accordance with
applicable Federal cost principles.
(m) The term institution of higher
education means an educational
institution in any State that—
(1) admits as regular students only
persons having a certificate of
graduation from a school providing
secondary education, or the recognized
equivalent of such a certificate;
(2) is legally authorized within such
State to provide a program of education
beyond secondary education;
(3) provides an educational program
for which the institution awards a
bachelor’s degree or provides not less
than a 2-year program that is acceptable
for full credit toward such a degree;
(4) is a public or other nonprofit
institution; and
(5) is accredited by a nationally
recognized accrediting agency or
association, or if not so accredited, is an
institution that has been granted
preaccreditation status by such an
agency or association that has been
recognized by the Secretary of
Education for the granting of
preaccreditation status, and the
Secretary of Education has determined
that there is satisfactory assurance that
the institution will meet the
accreditation standards of such an
agency or association within a
reasonable time (20 U.S.C. 1001). For
the purpose of this paragraph (l) only,
the term State includes, in addition to
the several States of the United States,
the Commonwealth of Puerto Rico, the
District of Columbia, Guam, American
Samoa, the United States Virgin Islands,
the Commonwealth of the Northern
Mariana Islands, and the Freely
Associated States. The term Freely
Associated States means the Republic of
the Marshall Islands, the Federated
States of Micronesia, and the Republic
of Palau.
(n) The term intellectual property
means an invention patentable under
title 35, United States Code, or any
patent on such an invention, or any
work for which copyright protection is
available under title 17, United States
Code.
(o) The term joint venture means a
business arrangement that:
(1) includes either:
(i) at least two separately owned
companies that are both substantially
involved in the project and both of
which are contributing to the cost-

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sharing required under the TIP statute,
with the lead company of the joint
venture being an eligible company; or
(ii) at least one eligible company and
one institution of higher education or
other organization, such as a national
laboratory, governmental laboratory (not
including NIST), or nonprofit research
institute, that are both substantially
involved in the project and both of
which are contributing to the costsharing required under the TIP statute,
with the lead entity of the joint venture
being either the eligible company or the
institution of higher education; and
(2) may include additional for-profit
companies, institutions of higher
education, and other organizations, such
as national laboratories and nonprofit
research institutes, that may or may not
contribute non-Federal funds to the
project.
(p) The term large-sized business
means any business, including any
parent company plus related
subsidiaries, having annual revenues in
excess of the amount published by the
Program in the relevant Federal Register
notice of availability of funds in
accordance with § 296.20. In
establishing this amount, the Program
may consider the dollar value of the
total revenues of the 1000th company in
Fortune magazine’s Fortune 1000
listing.
(q) The term matching funds or cost
sharing means that portion of project
costs not borne by the Federal
government. Sources of revenue to
satisfy the required cost share include
cash and third party in-kind
contributions. Cash may be contributed
by any non-Federal source, including
but not limited to recipients, state and
local governments, companies, and
nonprofits (except contractors working
on a TIP project). Third party in-kind
contributions include but are not
limited to equipment, research tools,
software, supplies, and/or services. The
value of in-kind contributions shall be
determined in accordance with § 14.23
of this title and will be prorated
according to the share of total use
dedicated to the TIP project. NIST shall
determine the allowability of matching
share costs in accordance with
applicable Federal cost principles.
(r) The term medium-sized business
means any business that does not
qualify as a small-sized business or a
large-sized business under the
definitions in this section.
(s) The term member means any entity
that is identified as a joint venture
member in the award and is a signatory
on the joint venture agreement required
by § 296.8.

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(t) The term nonprofit research
institute means a nonprofit research and
development entity or association
organized under the laws of any state for
the purpose of carrying out research and
development.
(u) The term participant means any
entity that is identified as a recipient,
subrecipient, or contractor on an award
to a joint venture under the Program.
(v) The term person will be deemed
to include corporations and associations
existing under or authorized by the laws
of the United States, the laws of any of
the Territories, the laws of any State, or
the laws of any foreign country.
(w) The term Program or TIP means
the Technology Innovation Program.
(x) The term recipient means an
organization receiving an award directly
from NIST under the Program.
(y) The term small-sized business
means a business that is independently
owned and operated, is organized for
profit, has fewer than 500 employees,
and meets the other requirements found
in 13 CFR part 121.
(z) The term societal challenge means
a problem or issue confronted by society
that when not addressed could
negatively affect the overall function
and quality of life of the nation, and as
such demands government attention.
(aa) Except for the use of the term
State for the limited purpose described
in paragraph (l) of this section, the term
State means any of the several States of
the United States, the District of
Columbia, the Commonwealth of Puerto
Rico, and any territory or possession of
the United States, or any agency or
instrumentality of a State exclusive of
local governments. The term does not
include any public and Indian housing
agency under the United States Housing
Act of 1937.
(bb) The term subaward means an
award of financial assistance made
under an award by a recipient to an
eligible subrecipient or by a
subrecipient to a lower tier subrecipient.
The term includes financial assistance
when provided by any legal agreement,
even if the legal agreement is called a
contract, but does not include
procurement of goods and services.
(cc) The term subrecipient means the
legal entity to which a subaward is
made and which is accountable to the
recipient for the use of the funds
provided.
(dd) The term transformational results
means potential project outcomes that
enable disruptive changes over and
above current methods and strategies.
Transformational results have the
potential to radically improve our
understanding of systems and
technologies, challenging the status quo

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of research approaches and
applications.
(ee) The term United States owned
company means a for-profit
organization, including sole proprietors,
partnerships, limited liability
companies (LLCs), and corporations,
that has a majority ownership by
individuals who are citizens of the
United States.
§ 296.3

Types of assistance available.

Subject to the limitations of this
section and § 296.4, assistance under
this part is available to eligible
companies or joint ventures that request
either of the following:
(a) Single Company Awards: No
award given to a single company shall
exceed a total of $3,000,000 over a total
of 3 years.
(b) Joint Venture Awards: No award
given to a joint venture shall exceed a
total of $9,000,000 over a total of 5
years.
§ 296.4

Limitations on assistance.

(a) The Federal share of a project
funded under the Program shall not be
more than 50 percent of total project
costs.
(b) Federal funds awarded under this
Program may be used only for direct
costs and not for indirect costs, profits,
or management fees.
(c) No large-sized business may
receive funding as a recipient or
subrecipient of an award under the
Program. When procured in accordance
with procedures established under the
Procurement Standards required by part
14 of chapter I of this title, recipients
may procure supplies and other
expendable property, equipment, real
property and other services from any
party, including large-sized businesses.
(d) If a project ends before the
completion of the period for which an
award has been made, after all allowable
costs have been paid and appropriate
audits conducted, the unspent balance
of the Federal funds shall be returned by
the recipient to the Program.

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§ 296.5 Eligibility requirements for
companies and joint ventures.

Companies and joint ventures must be
eligible in order to receive funding
under the Program and must remain
eligible throughout the life of their
awards.
(a) A company shall be eligible to
receive an award from the Program only
if:
(1) The company is a small-sized or
medium-sized business that is
incorporated in the United States and
does a majority of its business in the
United States; and

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(2) Either
(i) The company is a United States
owned company; or
(ii) The company is owned by a
parent company incorporated in another
country and the Program finds that:
(A) the company’s participation in
TIP would be in the economic interest
of the United States, as evidenced by
investments in the United States in
research, development, and
manufacturing (including, for example,
the manufacture of major components or
subassemblies in the United States);
significant contributions to employment
in the United States; and agreement
with respect to any technology arising
from assistance provided by the
Program to promote the manufacture
within the United States of products
resulting from that technology, and to
procure parts and materials from
competitive United States suppliers;
and
(B) that the parent company is
incorporated in a country which affords
to United States-owned companies
opportunities, comparable to those
afforded to any other company, to
participate in any joint venture similar
to those authorized to receive funding
under the Program; affords to United
States-owned companies local
investment opportunities comparable to
those afforded to any other company;
and affords adequate and effective
protection for the intellectual property
rights of United States-owned
companies.
(b) NIST may suspend a company or
joint venture from continued assistance
if it determines that the company, the
country of incorporation of the company
or a parent company, or any member of
the joint venture has failed to satisfy any
of the criteria contained in paragraph (a)
of this section, and that it is in the
national interest of the United States to
do so.
(c) Members of joint ventures that are
companies must be incorporated in the
United States and do a majority of their
business in the United States and must
comply with the requirements of
paragraph (a)(2) of this section. For a
joint venture to be eligible for
assistance, it must be comprised as
defined in § 296.2(o).
§ 296.6

Valuation of transfers.

(a) This section applies to transfers of
goods, including computer software,
and services provided by the transferor
related to the maintenance of those
goods, when those goods or services are
transferred from one joint venture
member to another separately-owned
joint venture member.

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(b) The greater amount of the actual
cost of the transferred goods and
services as determined in accordance
with applicable Federal cost principles,
or 75 percent of the best customer price
of the transferred goods and services,
shall be deemed to be allowable costs.
Best customer price means the GSA
schedule price, or if such price is
unavailable, the lowest price at which a
sale was made during the last twelve
months prior to the transfer of the
particular good or service.
§ 296.7

Joint venture registration.

Joint ventures selected for assistance
under the Program must notify the
Department of Justice and the Federal
Trade Commission under section 6 of
the National Cooperative Research Act
of 1984, as amended (15 U.S.C. 4305).
No funds will be released prior to
receipt by the Program of copies of such
notification.
§ 296.8

Joint venture agreement.

NIST shall not issue a TIP award to
a joint venture and no costs shall be
incurred under a TIP project by the joint
venture members until such time as a
joint venture agreement has been
executed by all of the joint venture
members and approved by NIST.
§ 296.9 Activities not permitted for joint
ventures.

The following activities are not
permissible for TIP-funded joint
ventures:
(a) exchanging information among
competitors relating to costs, sales,
profitability, prices, marketing, or
distribution of any product, process, or
service that is not reasonably required to
conduct the research and development
that is the purpose of such venture;
(b) entering into any agreement or
engaging in any other conduct
restricting, requiring, or otherwise
involving the marketing, distribution, or
provision by any person who is a party
to such joint venture of any product,
process, or service, other than the
distribution among the parties to such
venture, in accordance with such
venture, of a product, process, or service
produced by such venture, the
marketing of proprietary information,
such as patents and trade secrets,
developed through such venture, or the
licensing, conveying, or transferring of
intellectual property, such as patents
and trade secrets, developed through
such venture; and
(c) entering into any agreement or
engaging in any other conduct:
(1) to restrict or require the sale,
licensing, or sharing of inventions or
developments not developed through
such venture; or

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(2) To restrict or require participation
by such party in other research and
development activities, that is not
reasonably required to prevent
misappropriation of proprietary
information contributed by any person
who is a party to such venture or of the
results of such venture.
§ 296.10 Third party in-kind contribution of
research services.

NIST shall not issue a TIP award to
a single recipient or joint venture whose
proposed budget includes the use of
third party in-kind contribution of
research as cost share, and no costs shall
be incurred under such a TIP project,
until such time as an agreement
between the recipient and the third
party contributor of in-kind research has
been executed by both parties and
approved by NIST.

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§ 296.11 Intellectual property rights and
procedures.

(a) Rights in Data. Except as otherwise
specifically provided for in an award,
authors may copyright any work that is
subject to copyright and was developed
under an award. When claim is made to
copyright, the applicable copyright
notice of 17 U.S.C. 401 or 402 and
acknowledgment of Federal government
sponsorship shall be affixed to the work
when and if the work is delivered to the
Federal government, is published, or is
deposited for registration as a published
work in the U.S. Copyright Office. The
copyright owner shall grant to the
Federal government, and others acting
on its behalf, a paid up, nonexclusive,
irrevocable, worldwide license for all
such works to reproduce, publish, or
otherwise use the work for Federal
purposes.
(b) Invention Rights. (1) Ownership of
inventions developed from assistance
provided by the Program under
§ 296.3(a) shall be governed by the
requirements of chapter 18 of title 35 of
the United States Code.
(2) Ownership of inventions
developed from assistance provided by
the Program under § 296.3(b) may vest
in any participant in the joint venture,
as agreed by the members of the joint
venture, notwithstanding § 202 (a) and
(b) of Title 35, United States Code. Title
to any such invention shall not be
transferred or passed, except to a
participant in the joint venture, until the
expiration of the first patent obtained in
connection with such invention. In
accordance with § 296.8, joint ventures
will provide to NIST a copy of their
written agreement that defines the
disposition of ownership rights among
the participants of the joint venture,
including the principles governing the

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disposition of intellectual property
developed by contractors and
subcontractors, as appropriate, and that
complies with these regulations.
(3) The United States reserves a
nonexclusive, nontransferable,
irrevocable paid-up license, to practice
or have practiced for or on behalf of the
United States any inventions developed
using assistance under this section, but
shall not in the exercise of such license
publicly disclose proprietary
information related to the license.
Nothing in this subsection shall be
construed to prohibit the licensing to
any company of intellectual property
rights arising from assistance provided
under this section.
(4) Should the participants in a joint
venture cease to exist prior to the
expiration of the first patent obtained in
connection with any invention
developed from assistance provided
under the Program, in the course of the
bankruptcy or other dissolution process
for the last participant of the joint
venture, title to such patent may be
transferred or passed to a United States
entity that can commercialize the
technology in a timely fashion.
(c) Patent Procedures. Each award by
the Program will include provisions
assuring the retention of a governmental
use license in each disclosed invention,
and the government’s retention of
march-in rights. In addition, each award
by the Program will contain procedures
regarding reporting of subject inventions
by the recipient through the Interagency
Edison extramural invention reporting
system (iEdison), including the subject
inventions of recipients, including
members of the joint venture (if
applicable), subrecipients, and
contractors of the recipient or joint
venture members.
§ 296.12 Reporting and auditing
requirements.

Each award by the Program shall
contain procedures regarding technical,
business, and financial reporting and
auditing requirements to ensure that
awards are being used in accordance
with the Program’s objectives and
applicable Federal cost principles. The
purpose of the technical reporting is to
monitor ‘‘best effort’’ progress toward
overall project goals. The purpose of the
business reporting is to monitor project
performance against the Program’s
mission as required by the Government
Performance and Results Act (GPRA)
mandate for program evaluation. The
purpose of the financial reporting is to
monitor the status of project funds. The
audit standards to be applied to TIP
awards are the ‘‘Government Auditing
Standards’’ (GAS) issued by the

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Comptroller General of the United
States and any Program-specific audit
guidelines or requirements prescribed in
the award terms and conditions. To
implement paragraph (f) of § 14.25,
Revision of budget and program plans,
of this title, audit standards and award
terms may stipulate that ‘‘total Federal
and non-Federal funds authorized by
the Grants Officer’’ means the total
Federal and non-Federal funds
authorized by the Grants Officer
annually.
Subpart B—The Competition Process
§ 296.20

The selection process.

(a) To begin a competition, the
Program will solicit proposals through
an announcement in the Federal
Register, which will contain
information regarding that competition,
including the areas of critical national
need that proposals must address. An
Evaluation Panel(s) will be established
to evaluate proposals and ensure that all
proposals receive careful consideration.
(b) A preliminary review will be
conducted to determine whether the
proposal:
(1) Is in accordance with § 296.3,
Types of Assistance Available;
(2) Complies with either paragraph (a)
or paragraph (c) of § 296.5, Eligibility
Requirements for Companies and Joint
Ventures;
(3) Addresses the award criteria of
paragraphs (a) through (c) of § 296.22,
Award Criteria;
(4) Was submitted to a previous TIP
competition and if so, has been
substantially revised; and
(5) Is complete.
Complete proposals that meet the
preliminary review requirements
described above will be considered
further. Proposals that are incomplete or
do not meet any one of these
preliminary review requirements will
normally be eliminated.
(c) The Evaluation Panel(s) will then
conduct a multi-disciplinary peer
review of the remaining proposals based
on the evaluation criteria listed in
§ 296.21 and the award criteria listed in
§ 296.22. In some cases NIST may
conduct oral reviews and/or site visits.
The Evaluation Panel(s) will present
funding recommendations to the
Selecting Official in rank order for
further consideration. The Evaluation
Panel(s) will not recommend for further
consideration any proposal determined
not to meet all of the eligibility and
award requirements of this part and the
Federal Register notice announcing the
availability of funds.
(d) In making final selections, the
Selecting Official will select funding

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Federal Register / Vol. 73, No. 46 / Friday, March 7, 2008 / Proposed Rules
recipients based upon the Evaluation
Panel’s rank order of the proposals and
the following selection factors: assuring
an appropriate distribution of funds
among technologies and their
applications, availability of funds, and/
or Program priorities. The selection of
proposals by the Selecting Official is
final.
(e) NIST reserves the right to negotiate
the cost and scope of the proposed work
with the proposers that have been
selected to receive awards. This may
include requesting that the proposer
delete from the scope of work a
particular task that is deemed by NIST
to be inappropriate for support against
the evaluation criteria. NIST also
reserves the right to reject a proposal
where information is uncovered that
raises a reasonable doubt as to the
responsibility of the proposer. The final
approval of selected proposals and
award of assistance will be made by the
NIST Grants Officer as described in the
Federal Register notice announcing the
competition. The award decision of the
NIST Grants Officer is final.

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§ 296.21

Evaluation criteria.

A proposal must be determined to be
competitive against the Evaluation
Criteria set forth in this section to
receive funding under the Program.
Additionally, no proposal will be
funded unless the Program determines
that it has scientific and technical merit
and that the proposed research has
strong potential for meeting identified
areas of critical national need.
(a) The proposer(s) adequately
addresses the scientific and technical
merit and how the research may result
in intellectual property vesting in a
United States entity including evidence
that:
(1) The proposed research is novel;
(2) The proposed research is high-risk,
high-reward;
(3) The proposer(s) demonstrates a
high level of relevant scientific/
technical expertise for key personnel,
including contractors and/or informal
collaborators, and have access to the
necessary resources, for example
research facilities, equipment, materials,
and data, to conduct the research as
proposed;
(4) The research result(s) has the
potential to address the technical needs
associated with a major societal
challenge not currently being addressed;
and
(5) The proposed research plan is
scientifically sound with tasks,
milestones, timeline, decision points
and alternate strategies.
Total weight of (a)(1) through (5) is
50%.

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(b) The proposer(s) adequately
establishes that the proposed research
has strong potential for advancing the
state-of-the-art and contributing
significantly to the United States
science and technology base and to
address areas of critical national need
through transforming the Nation’s
capacity to deal with a major societal
challenge(s) that is not currently being
addressed, and generate substantial
benefits to the Nation that extend
significantly beyond the direct return to
the proposer including an explanation
in the proposal:
(1) Of the potential magnitude of
transformational results upon the
Nation’s capabilities in an area;
(2) Of how and when the ensuing
transformational results will be useful to
the Nation; and
(3) Of the capacity and commitment
of each award participant to enable or
advance the transformation to the
proposed research results (technology).
Total weight of (b)(1) through (3) is
50%.
§ 296.22

Award criteria.

NIST must determine that a proposal
successfully meets all of the Award
Criteria set forth in this section for the
proposal to receive funding under the
Program. The Award Criteria are:
(a) The proposal explains why TIP
support is necessary, including
evidence that the research will not be
conducted within a reasonable time
period in the absence of financial
assistance from TIP;
(b) The proposal demonstrates that
reasonable and thorough efforts have
been made to secure funding from
alternative funding sources and no other
alternative funding sources are
reasonably available to support the
proposal;
(c) The proposal explains the novelty
of the research (technology) and
demonstrates that other entities have
not already developed, commercialized,
marketed, distributed, or sold similar
research results (technologies);
(d) The proposal establishes that the
research has strong potential for
advancing the state-of-the-art and
contributing significantly to the United
States science and technology
knowledge base;
(e) The proposal has scientific and
technical merit and may result in
intellectual property vesting in a United
States entity that can commercialize the
technology in a timely manner; and
(f) The proposal establishes that the
proposed transformational research
(technology) has strong potential to
address areas of critical national need
through transforming the Nation’s

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capacity to deal with major societal
challenges that are not currently being
addressed, and generate substantial
benefits to the Nation that extend
significantly beyond the direct return to
the proposer.
Subpart C—Dissemination of Program
Results
§ 296.30

Monitoring and evaluation.

The Program will provide monitoring
and evaluation of areas of critical
national need and its investments
through periodic analyses. It will
develop methods and metrics for
assessing impact at all stages. These
analyses will contribute to the
establishment and adoption of best
practices.
§ 296.31

Dissemination of results.

Results stemming from the analyses
required by § 296.30 will be
disseminated in periodic working
papers, fact sheets, and meetings, which
will address the progress that the
Program has made from both a project
and a portfolio perspective. Such
disseminated results will serve to
educate both external constituencies as
well as internal audiences on research
results, best practices, and
recommended changes to existing
operations based on solid analysis.
§ 296.32 Technical and educational
services.

(a) Under the Federal Technology
Transfer Act of 1986, NIST has the
authority to enter into cooperative
research and development agreements
with non-Federal parties to provide
personnel, services, facilities,
equipment, or other resources except
funds toward the conduct of specified
research or development efforts which
are consistent with the missions of the
laboratory. In turn, NIST has the
authority to accept funds, personnel,
services, facilities, equipment and other
resources from the non-Federal party or
parties for the joint research effort.
Cooperative research and development
agreements do not include procurement
contracts or cooperative agreements as
those terms are used in sections 6303,
6304, and 6305 of Title 31, United
States Code.
(b) In no event will NIST enter into a
cooperative research and development
agreement with a recipient of an award
under the Program which provides for
the payment of Program funds from the
award recipient to NIST.
(c) From time to time, TIP may
conduct public workshops and
undertake other educational activities to
foster the collaboration of funding
Recipients with other funding resources

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for purposes of further development and
diffusion of TIP-related technologies. In
no event will TIP provide
recommendations, endorsements, or
approvals of any TIP funding Recipients
to any outside party.
§ 296.33

Annual report.

The Director shall submit annually to
the Committee on Commerce, Science,
and Transportation of the Senate and
the Committee on Science and
Technology of the House of
Representatives a report describing the
Technology Innovation Program’s
activities, including a description of the
metrics upon which award funding
decisions were made in the previous
fiscal year, any proposed changes to
those metrics, metrics for evaluating the
success of ongoing and completed
awards, and an evaluation of ongoing
and completed awards. The first annual
report shall include best practices for
management of programs to stimulate
high-risk, high-reward research.

FOR FURTHER INFORMATION CONTACT:

Concerning the proposed regulations,
John F. Tarrant or Ross E. Poulsen, (202)
622–7790; concerning submission of
comments and/or requests for a public
hearing, Kelly Banks, (202) 622–0932
(not toll-free numbers).
SUPPLEMENTARY INFORMATION:

Background and Explanation of
Provisions

[REG–137573–07]

Temporary regulations in the Rules
and Regulations section of this issue of
the Federal Register amend the Income
Tax Regulations (26 CFR part 1) under
section 1502 relating to the filing of
consolidated returns. The temporary
regulations revise § 1.1502–
13(c)(6)(ii)(C) to provide for the
redetermination of an intercompany
gain as excluded from gross income in
certain member stock transactions. The
text of those regulations also serves as
the text of these proposed regulations.
The preamble to the temporary
regulations explains the amendments.

RIN 1545–BH20

Special Analyses

Guidance Under Section 1502;
Amendment of Matching Rule for
Certain Gains on Member Stock

It has been determined that this notice
of proposed rulemaking is not a
significant regulatory action as defined
in Executive Order 12866. Therefore, a
regulatory assessment is not required. It
also has been determined that section
553(b) of the Administrative Procedure
Act (5 U.S.C. chapter 5) does not apply
to these regulations. It is hereby
certified that these regulations will not
have a significant economic impact on
a substantial number of small entities.
This certification is based on the fact
that these regulations primarily affect
affiliated groups of corporations, which
tend to be larger businesses. Moreover,
the number of taxpayers affected is
minimal and the regulations provide
relief in certain narrow circumstances.
Therefore, a Regulatory Flexibility
Analysis under the Regulatory
Flexibility Act (5 U.S.C. chapter 6) is
not required. Pursuant to section 7805(f)
of the Internal Revenue Code, these
regulations have been submitted to the
Chief Counsel for Advocacy of the Small
Business Administration for comment
on their impact on small business.

[FR Doc. E8–4562 Filed 3–6–08; 8:45 am]
BILLING CODE 3510–13–P

DEPARTMENT OF THE TREASURY
Internal Revenue Service
26 CFR Part 1

Internal Revenue Service (IRS),
Treasury.
ACTION: Notice of proposed rulemaking
by cross-reference to temporary
regulations.
AGENCY:

In the Rules and Regulations
section of this issue of the Federal
Register, the IRS is issuing temporary
regulations concerning the treatment of
certain intercompany gains with respect
to member stock within a consolidated
group. The text of those regulations also
serves as the text of these proposed
regulations. These regulations affect
corporations filing consolidated returns.
DATES: Written or electronic comments
and requests for a public hearing must
be received by June 5, 2008.
ADDRESSES: Send submissions to
CC:PA:LPD:PR (REG–137573–07), room
5203, Internal Revenue Service, PO Box
7604, Ben Franklin Station, Washington,
DC 20044. Submissions may be handdelivered Monday through Friday
SUMMARY:

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between the hours of 8 a.m. and 4 p.m.
to CC:PA:LPD:PR (REG–137573–07),
Courier’s Desk, Internal Revenue
Service, 1111 Constitution Avenue,
NW., Washington, DC 20224, or sent
electronically via the Federal
eRulemaking Portal at
www.regulations.gov (IRS REG–137573–
07).

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Comments and Requests for a Public
Hearing
Before these proposed regulations are
adopted as final regulations,
consideration will be given to any
written (a signed original and 8 copies)
or electronic comments that are
submitted timely to the IRS. The IRS
and Treasury Department request
comments on the clarity of the proposed
rules and how they can be made easier
to understand. In particular, the IRS and
Treasury Department do not foresee
situations in which it should be
necessary to invoke § 1.1502–
13(c)(6)(ii)(C) (the ‘‘Commissioner’s
Discretionary Rule’’) with respect to
intercompany gain on property other
than stock. Nevertheless, the IRS and
Treasury Department request comments
on whether any such situations are not
appropriately addressed by other
provisions of § 1.1502–13. The
Commissioner’s Discretionary Rule will
be retained while the IRS and Treasury
Department consider such comments.
However, absent compelling comments,
the IRS and Treasury Department
anticipate ultimately eliminating the
Commissioner’s Discretionary Rule. All
comments will be available for public
inspection and copying. A public
hearing will be scheduled if requested
in writing by any person that timely
submits written comments. If a public
hearing is scheduled, notice of the date,
time, and place for the public hearing
will be published in the Federal
Register.
Drafting Information
The principal author of these
regulations is John F. Tarrant, Office of
Associate Chief Counsel (Corporate).
However, other personnel from the IRS
and Treasury Department participated
in their development.
List of Subjects in 26 CFR Part 1
Income taxes, Reporting and
recordkeeping requirements.
Proposed Amendments to the
Regulations
Accordingly, 26 CFR part 1 is
proposed to be amended as follows:
PART 1—INCOME TAXES
Paragraph 1. The authority citation
for part 1 is amended by adding an entry
in numerical order to read in part as
follows:
Authority: 26 U.S.C. 7805 * * *
Section 1.1502–13 also issued under 26
U.S.C. 1502. * * *

Par. 2. Section 1.1502–13 is amended
by revising paragraphs (c)(6)(ii)(C),

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