[Federal Register Volume 59, Number 67 (Thursday, April 7, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-8370]


[[Page Unknown]]

[Federal Register: April 7, 1994]


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DEPARTMENT OF TRANSPORTATION

Coast Guard

33 CFR Part 1

[CGD 93-079]
RIN 2115-AE68

 

Simplified Alternative Procedure for Resolving Civil Penalty 
Cases

AGENCY: Coast Guard, DOT.

ACTION: Interim final rule.

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SUMMARY: The Coast Guard is issuing an Interim Final Rule (IFR) to 
allow for greater delegation by the District Commander, and to allow 
for a simplified alternative procedure for resolving civil penalty 
cases to be tested in three pilot ports for a period of six months. 
This procedure should streamline the civil penalty process for certain 
oil discharge and pollution prevention civil penalty cases by allowing 
a Coast Guard official to present a Notice of Violation and proposed 
penalty to a party in the field. Results of the pilot program will be 
used in determining whether the program should be implemented 
nationally and amending the final rule, if appropriate.

DATES: This rule is effective on April 7, 1994.
    Comments must be received by October 7, 1994.

ADDRESSES: Comments may be mailed to the Executive Secretary, Marine 
Safety Council (G-LRA/3406) (CGD 93-079), U.S. Coast Guard 
Headquarters, 2100 Second Street, SW., Washington, DC 20593-0001, or 
may be delivered to room 3406 at the same address between 8 a.m. and 3 
p.m., Monday through Friday, except Federal holidays. The telephone 
number is (202) 267-1477. The Executive Secretary maintains the public 
docket for this rulemaking. Comments will become part of this docket 
and will be available for inspection or copying at room 3406, U.S. 
Coast Guard Headquarters, Unless otherwise indicated, documents 
referenced in this preamble are available for inspection and copying at 
the office of the Executive Secretary, Marine Safety Council (G-LRA/
3406), U.S. Coast Guard Headquarters, 2100 Second Street SW., room 
3406, Washington, DC 20593-0001 between 8 a.m. and 3 p.m., Monday 
though Friday, except Federal holidays. The telephone number is (202) 
267-6234.

FOR FURTHER INFORMATION CONTACT:
Lieutenant Commander Richard Gaudiosi, Project Manager, Marine 
Environmental Protection Division (G-MEP), (202) 267-6714.

SUPPLEMENTARY INFORMATION:

Request for Comments

    The Coast Guard is encouraging comments on this interim rule in 
order to consider as many perspectives as possible on the impacts of 
employing this process and to evaluate its use as an enforcement tool 
prior to national implementation. Interested persons should submit 
written data, views, or arguments. Persons submitting comments should 
include their names and addresses, identify this rulemaking (CGD 93-
079) and the specific section of this interim rule to which each 
comment applies, and give the reason for each comment. The Coast Guard 
requests that all comments and attachments be submitted in an unbound 
format suitable for copying and electronic filing. If not practical, a 
second copy of any bound materials is requested. Persons wanting 
acknowledgment of receipt of comments should enclose a stamped, self-
addressed postcard or envelope.
    The Coast Guard will consider all comments received during the 
comment period. This interim final rule may be changed in view of the 
comments.
    The Coast Guard plans no public hearing. Persons may request a 
public hearing by writing to the Marine Safety Council at the address 
under ``ADDRESSES.'' The request should include reasons why a hearing 
would be beneficial. If it determines that the opportunity for oral 
presentations will aid this rulemaking, the Coast Guard will hold a 
public hearing in a time and place announced by a later notice in the 
Federal Register.

Drafting Information

    The principal persons involved in drafting this document are 
Lieutenant Commander Richard Gaudiosi, Project Manager, Marine 
Environmental Protection Division, and C.G. Green, Project Counsel, 
Office of the Chief Counsel.

Background and Purpose

    The current procedures for assessing civil penalties by the Coast 
Guard are contained in 33 CFR 1.07. Generally this process begins when 
an alleged violation is detected by or reported to a Coast Guard 
official. The alleged violation is investigated, and if it appears that 
the elements for a violation case exist, civil enforcement action is 
initiated by preparing a case report with a recommended penalty and 
forwarding it with the case file to the appropriate Coast Guard 
District office for review. The District office reviews the report to 
determine whether there is in fact evidence of a prima facie case and 
whether the assessment of the recommended penalty by a Hearing Officer 
is appropriate. It then transmits the case file with a recommended 
action to the Hearing Officer. Based on this case file, the Hearing 
Officer makes an independent determination as to whether a violation 
appears to have been committed. If so, the Hearing Officer sends a 
Letter of Notification to the alleged violator that specifies, among 
other matters, the alleged violation(s) and a penalty amount that 
appears to be appropriate.
    A party may pay the penalty amount specified as being appropriate 
by the Hearing Officer, request an in-person hearing, or provide 
written evidence or arguments in lieu of a hearing. If the party pays 
the penalty, the case is closed and no further action is required. If 
the party chooses either of the latter two options, the Hearing Officer 
either conducts an in-person hearing or reviews the written evidence 
and arguments, and then issues a written decision assessing a penalty 
or dismissing the case. The Hearing Officer's decision may be 
administratively appealed to the Commandant of the Coast Guard.
    As applied to small (under 100 gallons) oil discharges and 
pollution prevention violations, the current civil penalty assessment 
process is not administratively efficient for many uncontested cases. 
Further, the time required to process these violations minimizes the 
deterrent effect of the sanction. It is not uncommon for a party to 
have additional violations before being notified of the initiation of 
action for the first violation.
    There is a need for a process where notice of violation can be 
given in the field to allow for early resolution of apparent small oil 
spill and pollution prevention violations. Such a process would save 
the time and cost of unnecessary internal review, improve deterrence, 
and enable corrective action by providing a party with earlier notice 
of violations. Each party would have the option of paying a proposed 
penalty or pursuing their right to a hearing.

Notice of Violation

    This rule amends 33 CFR 1.07 to provide a simplified procedure to 
expedite processing of certain civil penalty violation cases. An 
interim final rule is being published to test the simplified procedure. 
A pilot program will be conducted in three ports, prior to a final rule 
which would be implemented nationwide. The pilot program will be 
conducted for six months in the ports of Charleston, SC, Galveston, TX, 
and Los Angeles, CA.
    The procedures will allow settlement of cases following the 
issuance by a Coast Guard issuing officer of a Notice of Violation 
containing a proposed penalty. A Coast Guard issuing officer will be a 
commissioned, warrant, or petty officer, with specific training and 
authority to issue a Notice of Violation.
    A party will have the option of either paying the proposed penalty, 
requesting determination by a Hearing Officer, or taking no action on 
the Notice of Violation. Where a party decides to pay the proposed 
penalty indicated on a Notice of Violation, there will be no District 
Program Manager or Hearing Officer involved and the case will be 
closed. Where a party requests a determination by a Hearing Officer or 
takes no action, a full case file will be sent to the District 
Commander, in accordance with present procedure, for review prior to 
forwarding to the Hearing Officer. Upon receipt by the Hearing Officer, 
the case will be processed under the current procedures. Any adverse 
action by the Hearing Officer will be subject to administrative appeal 
under the current procedures. A party who takes no action on a Notice 
of Violation or who requests determination by a Hearing Officer may 
find the preliminary assessment issued by the Hearing Officer to be 
equal to or greater than that specified on the Notice of Violation.
    Use of the simplified procedure will initially be limited, by 
internal guidance, to certain requirements and prohibitions subject to 
Class I Administrative Civil Penalties under the Federal Water 
Pollution Control Act (FWPCA) as amended. A Notice of Violation can be 
issued for two types of violations: (1) Oil discharges in violation of 
the FWPCA, if they are 100 gallons or less, and (2) pollution 
prevention violations (33 CFR parts 154, 155, 156).
    Coast Guard issuing officers will issue a Notice of Violation with 
a proposed penalty only in clear-cut cases as determined by applying 
specific written guidance. Proposed penalty amounts would be taken from 
a penalty schedule based on objective criteria. Any case in which 
aggravating or extenuating circumstances are evidenced, or which 
concern violations not included in specific guidance documents, may be 
referred to the Hearing Officer for processing under current 
procedures.

Delegation by the District Commander

    This rule will also allow more flexibility on the part of the 
District Commander to delegate authority for review of alleged 
violations to any person under the District Commander's command. For 
example, the District Commander could delegate review authority to the 
Captain of the Port for certain pollution prevention violations, thus 
eliminating the need for review by the District Commander's staff, 
prior to the case being forwarded to a Hearing Officer. Such a 
delegation would streamline the processing of a violation case and 
would be in the best interest of the public and the party involved.

Regulatory Implementation

    Based on the results of the pilot test and internal and external 
comments received on the IFR, the Coast Guard will determine whether 
the procedure should be implemented nationally and will make revisions 
to the final rule and internal guidance, if appropriate. This approach 
will facilitate implementation without disrupting the existing civil 
penalty process for cases involving violations other than oil discharge 
or pollution prevention violations. However, the rule is designed to 
allow extension of the simplified process to other Coast Guard programs 
without additional amendments to 33 CFR 1.07.
    Under the Administrative Procedure Act (APA), procedural rules are 
exempt from the notice and comment procedures and, under 5 U.S.C. 
553(b)(3)(B), the promulgating agency may omit notice and comment. 
Further, under the alternative simplified procedure established by this 
IFR, a party will continue to have the option of requesting a hearing, 
as under current regulations. Therefore, the Coast Guard has determined 
that these regulations may be promulgated without prior notice and 
opportunity for comment.
    Since the public interest would not be served by delaying the date 
of the interim rule, and a party will continue to have the option of 
requesting a hearing, as under current regulations, the Coast Guard has 
also determined that under 5 U.S.C. 533(d), these rules may be made 
effective upon publication.
    Nonetheless, as previously discussed in this preamble, the Coast 
Guard is requesting comment on this interim rule and its pilot 
implementation program.

Regulatory Evaluation

    This rule is not a significant regulatory action under section 3(f) 
of Executive Order 12866, does not require an assessment of potential 
costs and benefits under section 6(a)(3) of that order, and has not 
been reviewed under that order. It is not significant under the 
``Department of Transportation Regulatory Policies and Procedures'' (44 
FR 11040; February 26, 1979). The Coast Guard expects the economic 
impact of this procedural rule to be so minimal that a full Regulatory 
Evaluation is unnecessary. The total annual cost to the public from 
civil penalties should not be changed by this proposal. Savings to the 
government will be realized from the reduction in administrative costs 
to enforce civil penalties by eliminating the need for review by the 
District Commander or action by the Hearing Officer in cases where the 
penalty specified in a Notice of Violation is paid by the party within 
the allowed time.

Small Entities

    Under the Regulatory Flexibility Act (5 U.S.C. 601 et seq.), the 
Coast Guard must consider whether this rulemaking will have a 
significant economic impact on a substantial number of small entities. 
``Small entities'' include independently owned and operated small 
businesses that are not dominant in their field and that otherwise 
qualify as ``small business concerns'' under section 3 of the Small 
Business Act (15 U.S.C. 632). Because it expects the impact of this 
proposal to be minimal, the Coast Guard certifies under 5 U.S.C. 605(b) 
that this rulemaking will not have a significant economic impact on a 
substantial number of small entities. If, however, you think that your 
business qualifies as a small entity and that this rulemaking will have 
significant economic impact on your business, please submit a comment 
(see ADDRESSES) explaining why you think your business qualifies and in 
what way and to what degree this rulemaking will economically affect 
your business.

Collection of Information

    This rulemaking contains no collection of information requirements 
under the Paperwork Reduction Act (44 U.S.C. 3501 et seq.).

Federalism

    The Coast Guard has analyzed this rule under the principles and 
criteria contained in Executive Order 12612 and has determined that 
this rule does not have sufficient federalism implications to warrant 
the preparation of a Federalism Assessment.

Environment

    The Coast Guard considered the environmental impact of this 
rulemaking and concluded that, under section 2.B.2 of Commandant 
Instruction M1645.1B, this rule is categorically excluded from further 
environmental documentation. Procedural rules do not require 
environmental impact studies. A Categorical Exclusion Determination is 
available in the docket for inspection or copying where indicated under 
ADDRESSES.

List of Subjects in 33 CFR Part 1

    Administrative practice and procedure, Authority delegations 
(Government agencies), Freedom of Information, Penalties.

    For the reasons set out in the preamble, the Coast Guard amends 33 
CFR part 1 as follows:

Subpart 1.07--Enforcement; Civil and Criminal Penalty Proceedings

    1. The authority citation of subpart 1.07 continues to read as 
follows:

    Authority: 14 U.S.C. 633; 49 CFR 1.46.

    2. Section 1.07-5 is revised to read as follows:


Sec. 1.07-5  Definitions.

    (a) The term District Commander, when used in this subpart, means 
the District Commander, or any person under the District Commander's 
command, delegated to carry out the provisions of Sec. 1.07-10(b).
    (b) The term Hearing Officer means a Coast Guard officer or 
employee who has been delegated the authority to assess civil 
penalties.
    (c) The term issuing officer means any qualified Coast Guard 
commissioned, warrant, or petty officer.
    (d) The term Notice of Violation means a notification of violation 
and preliminary assessment of penalty, given to a party, in accordance 
with Sec. 1.07-11.
    (e) The term party means the person alleged to have violated a 
statute or regulation to which a civil penalty applies and includes an 
individual or public or private corporation, partnership or other 
association, or a governmental entity.

    3. Section 1.07-10 is amended by revising paragraph (a) to read as 
follows:


Sec. 1.07-10  Reporting and investigation.

    (a) Any person may report an apparent violation of any law, 
regulation, or order that is enforced by the Coast Guard to any Coast 
Guard facility. When a report of an apparent violation has been 
received, or when an apparent violation has been detected by any Coast 
Guard personnel, the matter is investigated or evaluated by Coast Guard 
personnel. Once an apparent violation has been investigated or 
evaluated, a report of the investigation may be sent to the District 
Commander in accordance with paragraph (b) of this section or a Notice 
of Violation under Sec. 1.07-11 may be given to the party by an issuing 
officer.
* * * * *
    4. A new Sec. 1.07-11 is added to read as follows:


Sec. 1.07-11  Notice of Violation.

    (a) After investigation and evaluation of an alleged violation has 
been completed, an issuing officer may issue a Notice of Violation to 
the party.
    (b) The Notice of Violation will contain:
    (1) The alleged violation and the applicable law or regulations;
    (2) The amount of the maximum penalty that may be assessed for each 
violation;
    (3) The amount of proposed penalty that appears to be appropriate;
    (4) The statement that payment of the proposed penalty within 30 
days will settle the case;
    (5) The place and manner to which payment is to be made;
    (6) The statement that the party may request a hearing prior to any 
final assessment of a penalty and the address where to request such a 
hearing.
    (c) The Notice of Violation may be hand delivered to the party or 
an employee of the party, or may be mailed to the business address of 
the party.
    (d) If a party requests a hearing, or takes no action on the Notice 
of Violation within 30 days, a copy of the Notice of Violation, along 
with the case file, will be sent to the District Commander for 
processing under the procedures described in Sec. 1.07-10(b).

    Dated: March 9, 1994.
A.E. Henn,
Rear Admiral, U.S. Coast Guard, Chief, Office of Marine Safety, 
Security and Environmental Protection.
[FR Doc. 94-8370 Filed 4-6-94; 8:45 am]
BILLING CODE 4910-14-M