[Federal Register Volume 59, Number 150 (Friday, August 5, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-19120]


[[Page Unknown]]

[Federal Register: August 5, 1994]


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Part IX





Department of Transportation





_______________________________________________________________________



Federal Aviation Administration



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14 CFR Part 13




Civil Penalty Assessment Procedures; Proposed Rule
DEPARTMENT OF TRANSPORTATION

Federal Aviation Administration

14 CFR Part 13

[Docket No. 27854; Notice No. 94-26]
RIN 2120-AE-84

 
Civil Penalty Assessment Procedures

AGENCY: Federal Aviation Administration (FAA), Department of 
Transportation (DOT).

ACTION: Notice of proposed rulemaking (NPRM).

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SUMMARY: The FAA proposes to revise the procedures for assessing civil 
penalties for violations of the Federal Aviation Regulations and other 
provisions. The procedures proposed in this notice implement the 
requirements of the FAA Civil Penalty Administrative Assessment Act of 
1992, as they modify the procedures for adjudicating a civil penalty 
against a person acting in the capacity of a pilot, flight engineer, 
mechanic, or repairman. The proposed amendments are intended to inform 
the public of the procedures by which the FAA will carry out the 
authority in the new Act and to make other clarifying changes to Part 
13.

DATE: Comments must be received on or before October 4, 1994.

ADDRESSES: Comments on this notice may be delivered or mailed, in 
triplicate, to the Federal Aviation Administration, Office of the Chief 
Counsel, Attention: Rules Docket (AGC-10), Docket No. 27854, 800 
Independence Avenue, SW., Room 915G, Washington, DC 20591. Comments 
submitted must be marked: ``Docket No. 27854.'' Comments may be 
inspected in Room 915G between 8:30 a.m. and 5 p.m. on weekdays, except 
Federal holidays.

FOR FURTHER INFORMATION CONTACT: Mardi Ruth Thompson, Senior Attorney, 
Regulations Division (AGC-200), Federal Aviation Administration, 800 
Independence Ave., SW., Washington, DC 20591; telephone (202) 267-3073.

SUPPLEMENTARY INFORMATION:

Comments Invited

    Although most of the proposed changes in this notice are purely 
procedural, the FAA recognizes that the participation of the public may 
add significantly to the rulemaking process. Accordingly, this 
rulemaking is being done with notice and opportunity for public 
comment.
    Interested persons are invited to participate in the rulemaking by 
submitting such written data, views, or arguments as they may desire. 
Comments relating to environmental, energy, federalism, or 
international trade impacts that might result from adopting the 
proposals in this notice are also invited. Comments must include the 
regulatory docket or notice number and be submitted in triplicate to 
the address above. All comments received, as well as a report 
summarizing each substantive public contact with FAA personnel on this 
rulemaking, will be filed in the docket. The docket is available for 
public inspection before and after the comment closing date.
    All comments received on or before the closing date will be 
considered by the Administrator before taking action on this proposed 
rulemaking. Late-filed comments will be considered to the extent 
practicable. The proposals contained in this notice may be changed in 
light of the comments received.
    Commenters wishing the FAA to acknowledge receipt of their comments 
submitted in response to this notice must submit a pre-addressed, 
stamped postcard with those comments on which the following statement 
is made: ``Comments to Docket No. 27854.'' The postcard will be date-
stamped by the FAA and returned to the commenter.

Availability of NPRM

    Any person may obtain a copy of this NPRM by submitting a request 
to the Federal Aviation Administration, Office of Public Affairs, 
Attention: Public Inquiry Center (APA-200), 800 Independence Avenue, 
SW., Washington, DC 20591, or by calling (202) 267-3484. Requests must 
include the notice or docket number.
    Persons interested in being placed on a mailing list for future 
rulemaking actions should request a copy of Advisory Circular 11-2A, 
Notice of Proposed Rulemaking Distribution System, which describes the 
application procedure.

Background

    The FAA has ad authority, under a demonstration program that has 
been extended several times, to assess civil penalties not to exceed 
$50,000 for certain violations of the Federal Aviation Act of 1958 (49 
U.S.C. App. 1301 et seq.) (FAAct), the Federal Aviation Regulations (14 
CFR Parts 1-199), and other statutes and orders. Before August 26, 
1992, the procedures for adjudicating such civil penalties were the 
same for all persons charged with violations. This authority, for the 
most part, was temporary and finally expired on July 31, 1992. (Section 
905 of the FAAct in effect on July 31, 1992, 49 U.S.C. App. 1475.) The 
FAA rules adopted to carry out this authority, found in Sec. 13.16 and 
Part 13, Subpart G (14 CFR 13.16 and Part 13 Subpart G), provide an 
opportunity for a hearing before an administrative law judge (ALJ) of 
the Department of Transportation (DOT) and for further appeal to the 
FAA Administrator.
    On August 26, 1992, the FAA Civil Penalty Administrative Assessment 
Act of 1992 (CPAA Act) was enacted (Pub. L. 102-345, 106 Stat. 923), 
amending the FAAct. The CPAA Act made permanent the FAA's authority to 
assess civil penalties in these cases. For violations of the FAR and 
other provisions occurring on or after the date of enactment, the CPAA 
Act changed the procedures by which persons acting in the capacity of 
pilots, flight engineers, mechanics, and repairmen may seek review of 
civil penalties sought by the FAA. These changes include a hearing 
before a National Transportation Safety Board (NTSB) ALJ and an appeal 
to the full NTSB, in place of hearing before a DOT ALJ and an ultimate 
administrative appeal to the Administrator. In addition, some changes 
were made to the procedures for assessing civil penalties in cases 
against other persons.
    A technical amendment to the CPAA Act was enacted on October 31, 
1992, by section 208 of the Airport and Airway Safety, Capacity, Noise 
Improvement, and Intermodal Transportation Act of 1992 (Pub. L. 102-
581, 106 Stat. 4872). The authority of the FAA to assess civil 
penalties for violations of sections 901(c) (relating to imparting or 
conveying false information, generally involving alleged aircraft 
piracy or other criminal acts) and 901(d) (regarding carriage of 
weapons) of the FAAact inadvertently was omitted from the CPAA Act. The 
technical amendment returned this authority to the FAA.
    At present, the procedures for civil penalty assessment actions are 
contained in Sec. 13.16 and Part 13, Subpart G. To carry out the CPAA 
Act, a new Sec. 13.18 is proposed. That section would set forth new 
procedures for civil penalty actions against persons acting in the 
capacity of pilots, flights engineers, mechanics and repairmen. In 
addition, the FAA proposes to modify current Sec. 13.16 to exclude the 
actions covered under proposed Sec. 13.18, and to make other clarifying 
changes to Part 13. Unless otherwise noted below, all references to the 
FAAact include the amendments made by the CPAA Act and the technical 
amendment noted above.
    Although the FAA is initiating civil penalty actions against 
persons acting in the capacity of pilots, flights engineers, mechanics, 
and repairmen simply by informing the persons charged of the procedures 
to be used, this notice informs the public generally of how the FAA 
proposes to implement portions of the CPAA Act. This information will 
be helpful to the public, particularly to airmen, attorneys who handle 
these types of cases, and others who may be affected by the revised 
procedures.

DISCUSSION OF PROPOSED RULE

Topic-by-Topic Analysis

Civil Penalty Assessments Against a Person Acting in the Capacity of a 
Pilot, Flight Engineer, Mechanic, or Repairman

Applicability

    Proposed Sec. 13.18(a) would state the statutory authority for 
assessing a civil penalty against a person acting in the capacity of a 
pilot, flight engineer, mechanic, or repairman. This authority is 
discussed further in this preamble under discussion of proposed 
Sec. 13.16(a). Under section 2(c) of the CPAA Act, the revised 
procedures apply only to violations occurring on or after the date of 
enactment, August 26, 1992.

Interpretation of ``Person Acting in the Capacity''

    In reviewing the CPAA Act the question arises, under what 
circumstances is a person ``acting in the capacity of a pilot, flight 
engineer, mechanic, or repairman''? The CPAA Act could be interpreted 
in a number of ways. In developing the interpretation that follows, we 
are mindful that it is to the advantage of the FAA, the public, and the 
NTSB for the applicability of the CPAA Act to be easy to understand and 
use in each case. It is also logical and advantageous for similar cases 
to be heard in the same forum, to the extent possible. Further, the 
reviewing forum does not affect whether a respondent is afforded full 
due process when a civil penalty is assessed: Under both the NTSB and 
the FAA procedures, the respondent is given an opportunity for a 
hearing before an administrative law judge, an appeal within the 
respective agency, a right to petition the court of appeals to review 
any final adverse agency decision, and other procedural protections. 
The following interpretation was developed considering these factors, 
as well as relevant statutory construction principles.
    This interpretation applies only to the applicability of the CPAA 
Act, and is not intended to affect the application of any other portion 
of the FAAct or the regulations administered by the FAA.
    Section 901(a)(3)(D) of the FAAct provides a different 
administrative forum for adjudication in civil penalty assessment cases 
involving violations by a person ``acting in the capacity of a pilot, 
flight engineer, mechanic, or repairman * * *.'' We have considered 
whether a person in this context must actually hold a pilot certificate 
to be ``acting in the capacity of a pilot.'' This phrase, however, 
describes the respondent by his or her activities, not by legal status. 
The dictionary definition of the word ``acting'' includes both 
``holding a temporary rank or position'' and ``simulation.'' Webster's 
Third New International Dictionary 20 (1961). A person can simulate the 
capacity of a pilot without actually holding a pilot certificate, such 
as when operating in control of an aircraft without the appropriate 
airman certificates. The same is true for persons acting as flight 
engineers, mechanics, and repairmen. In each case a person can function 
as an airman (although in violation of the FAAct and the regulations), 
without holding an FAA certificate to do so. The FAA, therefore, 
interprets the CPAA Act not to require that a person hold a certificate 
in order to bring a civil penalty action under FAAct section 
901(a)(3)(D). It is the nature of the activity that triggers the 
applicability of section 901(a)(3)(D), not the particular certificates 
held by the person.
    The FAA has considered the type of activities that may constitute 
``acting in the capacity of a pilot, flight engineer, mechanic, or 
repairman.'' The capacity of a pilot is defined in the FAAct and the 
regulations, most notably in Parts 61 and 91, where the privileges and 
duties are set forth. The capacity of the other airmen also is defined 
in the FAAct and the regulations.
    The term ``acting,'' of necessity, includes the failure to act as 
legally required. Thus, a pilot who refuses to present his or her pilot 
certificate for inspection on request by the Administrator under 
Sec. 61.3(h) has acted (although improperly) in the capacity of a 
pilot. Acting in the capacity of an airman may also include failure to 
surrender an airman certificate when it is suspended or revoked, and 
any civil penalty action would be heard under the NTSB review 
procedures. See, Secs. 61.19(f), 63.15(c), and 65.15(c). Note from 
these samples that the privileges and duties under the FAR extend 
beyond actually flying an aircraft or performing maintenance on an 
aircraft. The NTSB procedures are not limited to cases involving 
``operational'' violations.
    The new procedures do not apply to an airman who is not acting in 
the capacity of a pilot, flight engineer, mechanic, or repairman. For 
instance, a person who holds a pilot certificate, but refuses to submit 
to screening before entering a sterile area of an airport under 
Sec. 107.20, is not acting in the capacity of a pilot. That rule 
applies to any passenger or other person entering a sterile area, not 
just pilots or persons operating aircraft. Any civil penalty action 
would be under the FAA review procedures in FAAct section 901(a)(3)(E).
    Finally, we have considered the extent of the respective airman's 
duties and privileges in conjunction with CPAA Act. For example, a 
flight instructor certificate is not a pilot certificate. A person must 
hold a pilot certificate, however, to obtain and to use a flight 
instructor certificate. See, Secs. 61.183(c)(1) and 61.195(b). For 
purposes of the CPAA Act, any civil penalty action for violations by a 
person acting in the capacity of a flight instructor would be heard 
under the NTSB procedures.
    Similarly, a person must hold a mechanic certificate to obtain and 
to use an inspection authorization. See, Secs. 65.91(c)(1) and 
65.92(a). Any civil penalty action for violations by persons acting in 
the capacity of an authorized inspector would be heard under the NTSB 
review procedures.
    Medical certificates are required for pilots and flight engineers, 
but also are required for flight navigators and air traffic control 
tower operators. Civil penalties for violations relating to medical 
certification by persons who are otherwise acting in the capacity of 
pilots or flight engineers would be heard under the NTSB review 
procedures; violations by other persons would be heard under the FAA 
procedures.
    The sanction examples in this interpretation are only for purposes 
of explaining the interpretation, and do not necessarily reflect agency 
sanction policy.
    The FAA would welcome comments on this interpretation.

Procedures

    Section 901(a)(3)(D)(i) of the FAAct provides that before issuing 
an order assessing a civil penalty against a person acting in the 
capacity of a pilot, flight engineer, mechanic, or repairman, the FAA 
must advise the person of the charges or any reasons relied upon by the 
FAA for the proposed action. The FAA must also provide the person with 
an opportunity to answer the charges and be heard as to why an order 
should not be issued. The person against whom an order assessing a 
civil penalty is issued may appeal the order to the NTSB. These 
procedures are substantially similar to those provided for by section 
609(a) of the FAAct (49 U.S.C. App. 1429(a)) regarding certificate 
actions (such as suspension and revocation of airman certificates). The 
procedures for taking certificate actions are found in Sec. 13.19. 
Proposed Sec. 13.18 would provide procedures for civil penalty actions 
in these cases in a manner substantially similar to those now used for 
certificate actions.
    Proposed Sec. 13.18 procedures are different from those in 
Sec. 13.16. Under the statutory authority for cases against persons 
acting in the capacity of pilots, flight engineers, mechanics, and 
repairman (new section 901(a)(3)(D) of the FAAct), the order that 
assesses a civil penalty is issued first, with an opportunity to appeal 
to the NTSB. Under the statutory authority for cases against others 
(former section 905 and new section 901(a)(3)(E) of the FAAct), the 
opportunity for a hearing is given before an order is issued and the 
appeal is not to the NTSB, but to DOT administrative law judges and 
then to the FAA Administrator.
    Under proposed Sec. 13.18(e), the FAA would initiate a civil 
penalty action against a person acting in the capacity of a pilot, 
flight engineer, mechanic, or repairman by issuing a notice of proposed 
assessment. The notice would contain a statement of the charges and the 
proposed amount of the penalty. The person charged with the violation 
would be given the opportunity to respond using informal procedures, 
such as a written response or an informal conference with an agency 
attorney. This notice would satisfy the requirement under section 
901(a)(3)(D)(i) that the person be advised of the charges and be given 
an opportunity to answer them and be heard. This procedure would be 
substantially the same as that used for certificate actions.
    Under proposed Sec. 13.18(b), an order of assessment may be issued 
following the notice and opportunity to respond. Thereafter, the person 
has the right to appeal the order to the NTSB under section 
901(a)(3)(D)(iv) of the FAAct. Under that section of the FAAct, an 
appeal stays the effectiveness of the order.
    Under section 1006 of the FAAct, a petition for review of an order 
of the NTSB or the Administrator may be filed with the courts of 
appeals of the United States or the United States Court of Appeals for 
the District of Columbia. Proposed Sec. 13.18(j) would provide that the 
Administrator's order of assessment is not a final order of the 
Administrator for purposes or judicial appellate review unless it is 
appealed first to the NTSB.

Compromise of Civil Penalties

    Section 13.16(l)(1) currently provides agency attorneys with the 
authority to compromise a civil penalty action with no finding of 
violation. Proposed Sec. 13.18(k)(1) would continue to provide this 
authority in civil penalty assessment actions against persons acting in 
the capacity of pilots, flight engineers, mechanics, and repairmen.
    Agency attorneys may issue compromise orders after discussions and 
deliberations with the person charged with the violation. Frequently an 
agreement is reached verbally and the agency attorney issues the 
compromise order that reflects the agreement. The civil penalty amount 
agreed upon may be less than that proposed in the notice of proposed 
civil penalty. The person charged generally is not required to sign the 
compromise order.
    Section 13.16(l)(1) does not specifically require the person 
charged either to pay the civil penalty or sign a promissory note 
before an order is issued. The FAA has experienced problems with this 
approach. When no payment is received before the issuance of a 
compromise order, in some cases the person fails to pay the civil 
penalty and debt collection procedures must be initiated. If the person 
has not signed a promissory note agreeing to the amount of the penalty 
and a payment schedule, there is a risk than the person will dispute 
whether the amount in the compromise order is the amount agreed upon, 
complicating collection proceedings. Collection procedures often are 
time-consuming and costly, and may not result in recovery of the full 
amount of the debt.
    The FAA is proposing to require that no compromise order will be 
issued under Sec. 13.18 unless the civil penalty is paid or a 
promissory note providing for installment payments is signed by the 
person charged. In most cases the full amount will be paid before the 
compromise order is issued, eliminating the possibility that collection 
proceedings will be needed. In those cases in which a payment schedule 
is used, the promissory note will show specifically what has been 
agreed to, which should simplify collection proceedings if they become 
necessary.
    Although the current rules do not address issues relating to debt 
collection after issuance of a compromise order, the approach described 
above has been used successfully by many agency attorneys. Furthermore, 
it appears to be well-accepted by the persons who agree to compromise 
orders.

Civil Penalty Assessments Against Persons Other Than Those Acting in 
the Capacity of Pilots, Flight Engineers, Mechanics, and Repairmen

    The general rules for assessing civil penalties for violations 
before the enactment of the CPAA Act are found in Sec. 13.16 of the 
FAR. These rules remain in effect for all actions arising from 
violations that occurred before August 26, 1992. These rules will 
remain in effect for all actions arising from violations occurring 
after that date, except for violations by persons acting in the 
capacity of pilots, flight engineers, mechanics, and repairmen.
    When a person charged with a violation under Sec. 13.16 requests a 
hearing, the rules of practice in Part 13, Subpart G govern the 
proceedings.

Applicability

    Section 13.16(a) of the FAA currently contains a partial list of 
the statutory provisions authorizing the FAA to assess civil penalties. 
The FAA proposes to expand that list to provide more information. 
Proposed Sec. 13.16(a)(1) would describe the statutory provisions that 
give the FAA authority to assess civil penalties. Proposed 
Sec. 13.16(a)(2) would specify the amounts of the penalties that may be 
assessed. There may be other civil penalty provisions that may apply on 
occasion, and when necessary this authority is used to assess civil 
penalties.
    Proposed Sec. 13.16(a)(1) describes the FAA's general statutory 
authority for assessing civil penalties. Proposed Sec. 13.16(a)(1)(i) 
states that under section 905 of the FAAct, in effect on July 31, 1992 
(before section 905 expired), the FAA may assess a civil penalty for 
violations occurring before August 26, 1992, for violations of the 
FAAct. Proposed Sec. 13.16(a)(1)(ii) states that under section 
901(a)(3) of the FAAct, in effect on July 31, 1992, the FAA may assess 
a civil penalty for a violation of title V of the FAAct (which relates 
to the registration of aircraft and recordation of aircraft ownership) 
occurring before August 26, 1992. Section 905 of the FAAct was repealed 
by section 2(b) of the CPAA Act, and section 901(a)(3) was amended by 
section 2(a) of the CPAA Act. Section 2(c) of the CPAA Act, however, 
provides that sections 901(a)(3) and 905 of the FAAct as they existed 
on July 31, 1992, continue in effect with respect to violations of the 
FAAct occurring before August 26, 1992.
    Proposed Sec. 13.16(a)(1)(iii) states that under section 901(a)(3) 
of the FAAct, the FAA may assess civil penalties against persons other 
than those acting in the capacity of pilots, flight engineers, 
mechanics, or repairmen, for violations occurring on or after August 
26, 1992. This provision applies to violations of title III, V, VI, or 
XII or section 1101 of 1115(e)(2)(B) of the FAAct or any rule, 
regulation, or order issued thereunder. This is the authority granted 
in section 2(a) of the CPAA Act. In addition, this section applies to 
violations of section 901(c) and 901(d) of the FAAct occurring on or 
after October 31, 1992, the date of the technical amendment cited 
above.
    Proposed Sec. 13.16(a)(1)(iv) repeats the statutory language of 
section 9308(e) of the Airport Noise and Capacity Act of 1990 (ANCA) 
(49 U.S.C. App. 2157(e)). As explained in the preamble to the final 
rule implementing ANCA (56 FR 48628, 48630; September 25, 1991), 
section 9308(e) and the implementing regulations in Part 91 apply to 
the operators of Stage 2 aircraft. This section would not change the 
penalties or procedures that may apply to aircraft operating rules in 
Part 91. The proposed sections also do not change the penalties or 
procedures that may apply to airport operators for violations of Part 
158 (passenger facility charges) or Part 161 (airport noise or access 
restrictions).
    Proposed Sec. 13.16(a)(1)(v) describes the statutory limitations on 
the authority in Sec. 13.16(a)(1) (i), (ii), (iii), and (iv). In cases 
outside this authority (e.g., in which the amount in controversy 
exceeds $50,000), the FAA may not assess a civil penalty. It may only 
seek a civil penalty under the procedures in Sec. 13.15. These 
limitations are statutory, and are found in sections 901(a)(3) and 905 
of the FAAct as they existed on July 31, 1992, and in section 
901(a)(3)(C) of the FAAct as amended by the CPAA Act.
    Proposed Sec. 13.16(a)(1)(vi) states the authority to assess civil 
penalties for hazardous materials violations. This authority is granted 
to the Secretary of Transportation under section 110 of the Hazardous 
Materials Transportation Act (HMT Act), and delegated to the FAA under 
49 CFR 1.47(k). Because the authority to assess penalties is not 
granted by section 901(a)(3) of the FAAct, these cases are not subject 
to the limitations described in proposed Sec. 13.16(a)(1)(v).
    Proposed Sec. 13.16(a)(1)(vii) states the authority to assess civil 
penalties under section 404(d) of the FAAct, for violations relating to 
smoking on scheduled flights and tampering with smoke alarm devices. 
This authority is granted to the Secretary of Transportation in section 
404(d), and delegated to the FAA in 49 CFR 1.47(q). It is not subject 
to the limitations in proposed Sec. 13.16(a)(1)(v).
    Proposed Sec. 13.16(a)(2) describes the amounts of civil penalties 
authorized by the various statutes for each violation. Proposed 
Sec. 13.16(a)(2)(i) states the general authority, found in section 
901(a)(1) of the FAAct, for civil penalties of up to $1,000 for each 
violation. Proposed Sec. 13.16(a)(2)(ii) states the authority, found in 
section 901(a) of the FAAct, to seek civil penalties not exceeding 
$10,000 for each violation by a person (other than an airman serving in 
the capacity of an airman) who operates aircraft for compensation or 
hire. Proposed Sec. 13.16(a)(2)(iii) states the authority, found in 
section 901(a)(1) of the FAAct, for civil penalties not exceeding 
$10,000 for violations relating to the registration of aircraft and 
recordation of aircraft ownership under title V of the FAAct. Proposed 
Sec. 13.16(a)(2)(iv) stats the authority, found in section 901(c) of 
the FAAct, for civil penalties of not more than $10,000 for imparting 
or conveying false information, generally involving alleged aircraft 
piracy or other criminal acts. Proposed Sec. 13.16(a)(2)(v) states the 
authority, found in section 901(d) of the FAAct, for civil penalties of 
not more than $10,000 for certain offenses regarding the carriage of 
weapons.
    Proposed Sec. 13.16(a)(2)(vi) states the authority to seek civil 
penalties of not more than $10,000 for each hazardous materials 
violation occurring before November 16, 1990, or a civil penalty of not 
more than $25,000 and not less than $250 for each violation occurring 
on or after November 16, 1990, in accordance with section 901(a)(1) of 
the FAAct and section 110 of the HMT Act. It further states the factors 
that must be considered by the agency in determining the amount of the 
civil penalty under the HMT Act. Proposed Sec. 13.16(a)(2)(vii) states 
the authority, for violations of section 404(d) of the FAAct, to seek a 
civil penalty of the amount specified in the FAAct, or an amount not to 
exceed $2,000.
    Part 13, Subpart G contains the rules of practice for hearings in 
cases initiated under Sec. 13.16. Section 13.201 of that subpart 
currently provides a partial list of the statutory provisions under 
which the FAA may assess civil penalties. The list is not completely 
accurate. For instance, reading Sec. 13.201(c) together with 
Sec. 13.210(a) may lead someone to conclude that the FAA cannot assess 
civil penalties in excess of $50,000 in cases under the HMT Act. This 
would be incorrect, as discussed above. The FAA proposes to remove the 
discussion of statutory authority from Sec. 13.201, and incorporate all 
such information in proposed Sec. 13.16(a) (1) and (2).

Standard of Review

    Section 901(a)(3)(E)(ii) of the FAAct, as amended by Sec. 2(a) of 
the CPAA Act, enacts the standard by which the Administrator reviews 
the decisions of ALJs. That section provides that the only issues the 
Administrator will consider on appeal are: (1) Whether each finding of 
fact is supported by a preponderance of reliable, probative, and 
substantial evidence; (2) whether each conclusion of law is made in 
accordance with applicable law, precedent, and public policy; and (3) 
whether the ALJ committed any prejudicial errors that support the 
appeal. The FAA proposes to incorporate these standards in 
Sec. 13.233(b). With the exception of a reference to the ``FAA 
decisionmaker'' rather than the ``Administrator,'' the proposed change 
in Sec. 13.233(b) mirrors the language of the CPAA Act.
    Section 13.233(j), regarding the FAA decisionmaker's decision on 
appeal, would be modified to remove the language that touches upon the 
standard of review. The existing regulation states that the FAA 
decisionmaker will review the record, briefs, and oral argument ``to 
determine if the administrative law judge committed prejudicial error 
in the proceedings or that the initial decision should be affirmed, 
modified, or reversed.'' The proposed change would provide that the FAA 
decisionmaker will review the record, briefs, and oral argument ``when 
considering the issues on appeal.'' In this way, the proposed rule will 
refer back to the standard of review set forth in Sec. 13.233(b). The 
FAA decisionmaker retains the authority to affirm, modify, or reverse 
an initial decision specified in Sec. 13.233(j); this would not be 
changed by these proposed amendments.
    In Sec. 13.233(b)(1) there is a typographical error. The word 
``filing'' would be corrected to read ``finding.''

Other Amendments

    As discussed in the preamble for Sec. 13.18, above, the FAA has 
experienced problems with Sec. 13.16(l)(1), regarding compromise 
orders. For the reasons explained above, the FAA proposes to amend that 
section to provide that no compromise order will be issued unless the 
civil penalty is paid or a promissory note providing for installment 
payments is signed by the person charged.
    Section 13.16(k) indicates when a party may petition for review of 
a civil penalty assessment to the United States Courts of Appeals. That 
section states that an initial decision or order issued by an ALJ that 
has not been appealed to the FAA decisionmaker, and an order 
compromising a civil penalty action, do not constitute final orders of 
the Administrator for the purposes of judicial review under section 
1006 of the FAAct. A petition for review from these orders is not 
appropriate, because available administrative remedies were not 
exhausted. They are considered to be final orders of the Administrator, 
however, for such purposes as closing out the enforcement action in FAA 
records and collecting the civil penalty as a debt to the United 
States. In the case of an initial decision in which the person has been 
found to have violated the FAR, the finding of violation becomes part 
of the FAA enforcement history of the person. Accordingly, the FAA 
proposes to amend that section to delete the characterization of these 
orders as not final.

Limitation Period for Commencing Civil Penalty Assessments

    Section 2462 of title 28 of the United States Code prescribes a 
general 5-year limit within which the United States must commence an 
action for the assessment of a civil penalty. This statute of 
limitations recently has been held to be applicable to the entire 
federal government in civil penalty cases, unless Congress specifically 
provides otherwise. In 1990, the FAA, as the prosecuting and regulating 
agency, self-imposed a 2-year regulatory limit on the initiation of its 
civil penalty assessment cases, except where good cause exists. See, 55 
FR at 27552 to 27557 (July 3, 1990). In adopting this regulatory 
limitation period, the FAA attempted to carefully balance the needs of 
the agency for sufficient time to investigate, review, and initiate a 
case; the interest of respondents in timely notice and adjudication; 
and the public interest in promoting compliance with the regulations.
    Subsequently, in 1992, the CPAA Act codified the FAA's 2-year limit 
for civil penalty assessment cases adjudicated by the FAA, but did not 
establish a limitation period for civil penalty assessment cases 
appealable to the NTSB. Thus, the law limiting the time in which the 
FAA may initiate civil penalty assessment actions against persons 
acting in the capacity of pilots, flight engineers, mechanics, or 
repairmen continues to be section 2462.
    On February 25, 1993, the Board published interim rules to 
implement the CPAA Act (58 FR 11379). In requesting public 
participation, the NTSB asked particularly for comments on the proposed 
applicability of its stale complaint rule, 49 CFR 821.33, to civil 
penalty actions. That rule applies, by its terms, to certificate action 
cases adjudicated before the NTSB, that is, cases involving the 
amendment, modification, suspension, or revocation of certificates 
issued by the FAA. It provides, with some exceptions, that a complaint 
may be dismissed where an offense occurred more than 6 months before 
the Administrator advised the respondent as to the reasons for 
proposing certificate action. The Board will now apply the 6-month 
stale complaint rule to both certificate action and civil penalty cases 
it hears on appeal.
    In responding to the Board's request for comments, the FAA stated 
that it will continue agency policy to initiate all cases affected by 
the new procedures as expeditiously as possible. It is expected that 
those cases generally will be initiated within 6 months of the date the 
violation occurred. There must, however, be administrative flexibility 
within the agency to allocate its resources, for instance, when higher 
safety priorities demand. Even in such instances, the FAA is 
constrained by the statutory time limits for taking action.
    In every case, regardless of the time taken for initiation, the FAA 
has been careful to distinguish the inherent authority of the Board, an 
adjudicative body, to consider whether delay in a particular case has 
unfairly prejudiced the opportunity of a respondent to defend against 
charges. The FAA fully supports the adoption by the Board, by rule, of 
an adjudicative policy favoring dismissal of a case or other 
appropriate action whenever a delay in initiating a particular case is 
shown to substantially diminish a respondent's ability to defend.

Civil Penalties Other Than Administrative Assessment

    Section 13.15 contains the general procedures by which the FAA may 
seek a civil penalty, other than by the administrative assessment 
procedures in Secs. 13.16 and 13.18. Under Sec. 13.15, the FAA may 
compromise a penalty, but if no agreement is reached the FAA refers the 
case to the United States Attorney General to prosecute and collect the 
civil penalty.
    Section 13.15 requires clarification. For instance, it indicates 
that all civil penalties in which the amount in controversy is over 
$50,000 must follow the procedures of that section. As discussed above, 
however, some civil penalties over $50,000 (such as hazardous materials 
violations) can be assessed administratively under Sec. 13.16. The FAA 
proposes to clarify that Sec. 13.15 applies to all civil penalty 
actions other than those in which the administrative procedures of 
Secs. 13.16 and 13.18 are used.

Change in Position Titles

    In a number of places in Part 13, authority to carry out various 
investigation and enforcement functions is delegated to the Assistant 
Chief Counsel for Regulations and Enforcement. The Regulations and 
Enforcement Division, however, has been split into two divisions--the 
Regulations Division and the Enforcement Division. The Assistant Chief 
Counsel for each division has the responsibility and authority to carry 
out various investigation and enforcement functions. Therefore, the FAA 
proposes to change the authority references in Part 13 to the Assistant 
Chief Counsel for Regulations and the Assistant Chief Counsel for 
Enforcement.

Initial Regulatory Evaluation Summary

    The FAA believes that the proposed procedural changes and minor 
clarifications conform the existing procedural rules to amendments made 
in the CPAA Act, and clarify existing rules. The changes do not, in 
economic terms, alter the basic processes by which civil penalties are 
assessed within the agency. For this reason, a full Regulatory 
Evaluation is not warranted.
    This regulatory evaluation examines the potential costs and 
benefits of the proposed rule to amend Part 13.
    The objectives of the proposed rule are to make clarifying changes, 
and to disclose the procedures that implement the CPAA Act.

Benefits

    The potential benefits of this proposed rule include clarifying the 
rule and explaining in detail how portions of the CPAA Act would be 
implemented. These proposed changes would provide potentially impacted 
aviation parties (e.g., pilots, flight engineers, mechanics, and 
repairmen) with a better understanding of the civil penalty process.

Costs

    The potential costs of the proposed rule would be zero because it 
consists only of procedural and clarifying changes to Part 13. The 
proposed procedural changes would only explain how the requirements of 
the CPAA Act and other statutes are implemented. The changes would not 
impose new economic requirements on potentially impacted parties. The 
clarification changes would further enhance the public's comprehension 
of the civil penalty assessment process.

International Trade Impact Assessment

    The proposed rule represents only procedural and clarifying 
changes. These proposed changes would not impose any costs on either 
U.S. or foreign operators. Therefore, a competitive trade disadvantage 
would not be incurred by U.S. operators abroad or foreign operators in 
the United States.

Initial Regulatory Flexibility Determination

    In accordance with the Regulatory Flexibility Act of 1980, the FAA 
certifies that the proposed rule would not have a significant economic 
impact, positive or negative, on a substantial number of small entities 
because the proposed rule would only address procedural and clarifying 
changes. Such changes would not impose any cost burdens or result in 
any cost savings.

Federalism Implications

    This proposed amendment would not have substantial direct effects 
on the 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. The respondents affected by the 
proposed new procedures are private citizens, not state governments. 
Therefore, in accordance with Executive Order 12612, preparation of a 
Federalism Assessment is not warranted.

Paperwork Reduction Act

    This proposed rule does contain no information collection requests 
requiring approval of the Office of Management and Budget pursuant to 
the Paperwork Reduction Act of 1980 (Pub. L. 96-511), there are no 
requirements for information collection associated with this proposed 
rule.

Conclusion

    For the reasons discussed in the preamble, and based on the 
findings of the Regulatory Flexibility Determination and the 
International Trade Analysis, the FAA has determined that this proposed 
regulation is not economically significant under Executive Order 12866. 
However, historically there has been significant public interest in the 
FAA's rules of practice in civil penalty assessment actions. For this 
reason, the FAA has determined that this proposed regulation is a 
significant regulatory action under the Executive Order. For the same 
reason, this proposal is considered significant under DOT Regulatory 
Policies and Procedures (44 FR 11034; February 26, 1979), due to the 
public interest in rules of practice for civil penalty proceedings. In 
addition, this proposal, the FAA certifies that this proposal, if 
adopted, will not have a significant economic impact, positive or 
negative, on a substantial number of small entities under the criteria 
of the Regulatory Flexibility Act.

List of Subjects in 14 CFR Part 13

    Administrative practice and procedure, Air transportation, Federal 
Aviation Administration, Hazardous materials transportation, 
Investigations, Law enforcement, Penalties.

The Proposed Amendments

    Accordingly, the Federal Aviation Administration proposes to amend 
part 13 of the Federal Aviation Regulations (14 CFR part 13), as 
follows:

PART 13--INVESTIGATIVE AND ENFORCEMENT PROCEDURES

    1. The authority citation for part 13 continues to read as follows:

    Authority: 49 U.S.C. 106(g) and 322; 49 U.S.C. App. 1354 (a) and 
(c), 1374(d), 1401-1406, 1421-1432, 1471-1473, 1481, 1482, 1484-
1489, 1523, 1655(c), 1808-1810, 2157 (e) and (f), 2216, 2218, 2219; 
Public Law 102-345, 106 Stat. 923; Section 208, Public Law 102-581, 
106 Stat. 4872; 18 U.S.C. 6002, 6004; 49 CFR 1.47.

    2. Section 13.15 is amended by revising the title and the 
introductory text of paragraph (a), removing the text of paragraph 
(a)(2), redesignating paragraph (a)(3) as (a)(2), and revising 
paragraph (c) introductory text, to read as follows:


Sec. 13.15  Civil penalties other than administrative assessment.

    (a) General. This section applies to each action in which the FAA 
seeks a civil penalty other than by administrative assessment 
procedures under Secs. 13.16 or 13.18. These actions, and the penalties 
that apply, include, but are not limited to, the following.
* * * * *
    (b) * * *
    (c) The Administrator may compromise any civil penalty proposed in 
accordance with this section, before referral to the United States 
Attorney General, or the delegate of the Attorney General, for 
prosecution.
* * * * *
    3. Section 13.16 is amended by revising the title and paragraphs 
(a), (k), the introductory text of paragraphs (l) and (l)(1), and 
paragraph (l)(1)(i), to read as follows:


Sec. 13.16  Civil penalties: Administrative assessment other than 
against a person acting in the capacity of a pilot, flight engineer, 
mechanic, or repairman.

    (a) General. This section applies to each action in which the FAA 
seeks to assess a civil penalty by administrative procedures, other 
than an action against a person acting in the capacity of a pilot, 
flight engineer, mechanic, or repairman under section 901(a)(3)(D) of 
the Federal Aviation Act of 1958, as amended (49 U.S.C. App. 
1471(a)(3)(D), section 2(a) of the FAA Civil Penalty Administrative 
Assessment Act of 1992 (Pub. L. 102-345, 106 Stat. 923), and section 
208 of the Airport and Airway Safety, Capacity, Noise Improvement, and 
Intermodal Transportation Act of 1992 (Pub. L. 102-581, 106 Stat. 
4872)). These actions and the penalties that apply include, but are not 
limited to, the following:
    (1) Authority to assess civil penalties.
    (i) The FAA may assess a civil penalty for a violation occurring 
before August 26, 1992, of the Federal Aviation Act of 1958, as 
amended, in accordance with section 905 of the Federal Aviation Act of 
1958 (49 U.S.C. App. 1475) in effect on July 31, 1992, and section 2(c) 
of the FAA Civil Penalty Administrative Assessment Act of 1992 (Pub. L. 
102-345, 106 Stat. 923).
    (ii) The FAA may assess a civil penalty for a violation of title V 
of the Federal Aviation Act of 1958 (which relates to registration of 
aircraft and recordation of aircraft ownership) occurring before August 
26, 1992, in accordance with section 901(a)(3) of the Federal Aviation 
Act of 1958 (49 U.S.C. App. 1471(a)(3)) in effect on July 31, 1992, and 
section 2(c) of the FAA Civil Penalty Administrative Assessment Act of 
1992 (Pub. L. 102-345, 106 Stat. 923).
    (iii) The FAA may assess a civil penalty against any person (other 
than a person acting in the capacity of a pilot, flight engineer, 
mechanic, or repairman) for a violation of title III, V, VI, or XII or 
section 1101 or 1115(e)(2)(B) of the Federal Aviation Act of 1958, as 
amended, or any rule, regulation, or order issued thereunder, occurring 
on or after August 26, 1992, or section 901(c) or 901(d) of the Federal 
Aviation Act of 1958, as amended, or any rule, regulation, or order 
issued thereunder, occurring on or after October 31, 1992, in 
accordance with section 901(a)(3) of the Federal Aviation Act of 1958, 
as amended (49 U.S.C. App. 1471(a)(3), section 2(a) of the FAA Civil 
Penalty Administrative Assessment Act of 1992 (Pub. L. 102-345, 106 
Stat. 923), and section 208 of the Airport and Airway Safety, Capacity, 
Noise Improvement, and Intermodal Transportation Act of 1992 (Pub. L. 
102-581, 106 Stat. 4872)).
    (iv) Violations of section 9308 or 9309 of the Airport Noise and 
Capacity Act of 1990 (49 U.S.C. App. 2157 or 2158) or any regulation 
issued to carry out such sections are subject to the same civil 
penalties and procedures as are provided by title IX of the Federal 
Aviation Act of 1958, as amended, for violations of title VI, in 
accordance with section 9308(e) of the Airport Noise and Capacity Act 
of 1990 (49 U.S.C. App. 2157(e)).
    (v) Notwithstanding the provisions of paragraphs (a)(1)(i), 
(a)(1)(ii), (a)(1)(iii), and (a)(1)(iv) of this section, the United 
States District Courts have exclusive jurisdiction of any civil penalty 
action initiated by the FAA, in accordance with section 901(a)(3)(C) of 
the Federal Aviation Act of 1958, as amended (49 U.S.C. App. 
1471(a)(3)(C)), and with sections 901(a)(3) and 905 of the Federal 
Aviation Act of 1958 (49 U.S.C. App. 1471(a)(3) and 1475) in effect on 
July 31, 1992, and section 2(c) of the FAA Civil Penalty Administrative 
Assessment Act of 1992 (Pub. L. 102-345, 106 Stat. 923)--
    (A) That involves an amount in controversy in excess of $50,000;
    (B) That is an in rem action or in which an in rem action based on 
the same violation has been brought;
    (C) Regarding which an aircraft subject to lien has been seized by 
the United States; and
    (D) In which a suit for injunction relief based on the violation 
giving rise to the civil penalty has also been brought.
    (vi) The FAA may assess a civil penalty against any person who 
knowingly commits an act in violation of the Hazardous Materials 
Transportation Act, as amended, or any rule, regulation, or order 
issued thereunder, in accordance with section 901(a)(1) of the Federal 
Aviation Act of 1958, as amended, and section 110 of the Hazardous 
Materials Transportation Act, as amended (49 U.S.C. App. 1809), and 49 
CFR 1.47(k).
    (vii) The FAA may assess a civil penalty against any person who 
violates section 404(d) of the Federal Aviation Act of 1958, as amended 
(relating to the prohibition against smoking on scheduled flights and 
tampering with smoke alarm devices), or any rule, regulation, or order 
issued thereunder, in accordance with sections 404(d) and 901(a)(1) of 
the Federal Aviation Act of 1958, as amended (49 U.S.C. App. 1374(d) 
and 1471(a)(1)), and 49 CFR 1.47(q).
    (2) Amount of civil penalties.--(i) Except as otherwise provided by 
statute, any person who violates any provision of title III, IV, V, VI, 
VII, or XII or of section 1101, or 1115(e)(2)(B) of the Federal 
Aviation Act of 1958, as amended, or any rule, regulation, or order 
issued thereunder, is subject to a civil penalty of not to exceed 
$1,000 for each such violation, in accordance with section 901(a)(1) of 
the Federal Aviation Act of 1958, as amended (49 U.S.C. App. 
1471(a)(1)).
    (ii) Any person who operates aircraft for the carriage of persons 
or property for compensation or hire (other than an airman serving in 
the capacity of an airman) is subject to a civil penalty of not to 
exceed $10,000 for each violation of title III, VI, or XII of the 
Federal Aviation Act of 1958, as amended, or any rule, regulation, or 
order issued thereunder, occurring after December 30, 1987, in 
accordance with section 901(a)(1) of the Federal Aviation Act of 1958, 
as amended (49 U.S.C. App. 1471(a)(1)).
    (iii) Any person is subject to a civil penalty of not to exceed 
$10,000 for each violation that relates to registration or recordation 
of an aircraft under title V of the Federal Aviation Act of 1958, as 
amended, in accordance with section 901(a)(1) of the Federal Aviation 
Act of 1958, as amended (49 U.S.C. App. 1471(a)(1)).
    (iv) Whoever imparts or conveys or causes to be imparted or 
conveyed false information, knowing the information to be false and 
under circumstances in which such information may reasonably be 
believed, concerning an attempt or alleged attempt being made or to be 
made, to do any act which would be a crime prohibited by subsection 
(i), (j), (k), or (l) of section 902 of the Federal Aviation Act of 
1958, as amended, is subject to a civil penalty of not more than 
$10,000, in accordance with section 901(c) of the Federal Aviation Act 
of 1958, as amended (49 U.S.C. App. 1471(c)).
    (v) Except for certain law enforcement officers and other 
authorized persons, whoever while aboard, or while attempting to board, 
any aircraft in, or intended for operation in, air transportation or 
intrastate air transportation, has on or about the person or the 
person's property a concealed deadly or dangerous weapon, which is, or 
would be, accessible to such person in flight is subject to a civil 
penalty of not more than $10,000, in accordance with section 901(d) of 
the Federal Aviation Act of 1958, as amended (49 U.S.C. App. 1471(d)).
    (vi) Any person who knowingly commits an act in violation of the 
Hazardous Materials Transportation Act, as amended, or any rule, 
regulation, or order issued thereunder, is subject to a civil penalty 
of not more than $10,000 for each violation occurring before November 
16, 1990, or a civil penalty of not more than $25,000 and not less than 
$250 for each violation occurring on or after November 16, 1990, in 
accordance with section 901(a)(1) of the Federal Aviation Act of 1958, 
as amended (49 U.S.C. App. 1471(a)(1)), and section 110 of the 
Hazardous Materials Transportation Act, as amended (49 U.S.C. App. 
1809). An order assessing a civil penalty for a violation under the 
Hazardous Materials Transportation Act, or a rule, regulation, or order 
issued thereunder, will be issued only after consideration of--
    (A) The nature and circumstances of the violation;
    (B) The extent and gravity of the violation;
    (C) The person's degree of culpability;
    (D) The person's history of prior violations;
    (E) The person's ability to pay the civil penalty;
    (F) The effect on the person's ability to continue in business; and
    (G) Such other matters as justice may require.
    (vii) Any person who violates section 404(d) of the Federal 
Aviation Act of 1958, as amended, or any rule, regulation, or order 
issued thereunder, is subject to a civil penalty of not more than the 
amount specified in the Federal Aviation Act of 1958, as amended, for 
each violation, in accordance with sections 404(d) and 901 of the 
Federal Aviation Act of 1958, as amended (49 U.S.C. App. 1374(d) and 
1471). Any passenger who tampers with, disables, or destroys any smoke 
alarm device located in any lavatory aboard an aircraft engaged in air 
transportation or intrastate air transportation is subject to a civil 
penalty in accordance with section 404(d) and 901 of the Federal 
Aviation Act of 1058, as amended, except that such civil penalty may be 
imposed in an amount up to $2,000.
* * * * *
    (k) Exhaustion of administrative remedies. A party may petition for 
review only of a final decision and order of the Administrator to the 
courts of appeals of the United States or the United States Court of 
Appeals for the District of Columbia under section 1006 of the Federal 
Aviation Act of 1958, as amended. An initial decision or order issued 
by an administrative law judge that has not been appealed to the FAA 
decisionmaker and an order compromising a civil penalty action may not 
be appealed under section 1006 of the Federal Aviation Act of 1958, as 
amended (49 U.S.C. App. 1486).
    (l) Compromise. The FAA may compromise any civil penalty action 
initiated in accordance with section 901 of the Federal Aviation Act of 
1958, as amended, at any time before referring the action to the United 
States Attorney General, or the delegate of the Attorney General, for 
collection.
    (1) An agency attorney may compromise any civil penalty action 
where a person charged with a violation agrees to pay a civil penalty 
and the FAA agrees to make no finding of violation. Under such 
agreement, a compromise order is issued following the payment of the 
agreed-upon amount or the signing of a promissory note. The compromise 
order states the following:
    (i) The person has paid a civil penalty or has signed a promissory 
note providing for installment payments.
* * * * *
    4. Part 13 is amended by adding a new Sec. 13.18 to read as 
follows:


Sec. 13.18  Civil penalties: Administrative assessment against a person 
acting in the capacity of a pilot, flight engineer, mechanic, or 
repairman.

    (a) General. This section applies to each action in which the FAA 
seeks to assess a civil penalty by administrative procedures under 
section 901(a)(3)(D) of the Federal Aviation Act of 1958, as amended 
(49 U.S.C. App. 1471(a)(3)(D), section 2(a) of the FAA Civil Penalty 
Administrative Assessment Act of 1992 (Pub. L. 102-345, 106 Stat. 923), 
and section 208 of the Airport and Airway Safety, Capacity, Noise 
Improvement, and Intermodal Transportation Act of 1992 (Pub. L. 102-
581, 106 Stat. 4872)) against a person acting in the capacity of a 
pilot, flight engineer, mechanic, or repairman. These actions, and the 
penalties that apply, include, but are not limited, to the following:
    (1) Authority to assess civil penalties.--(i) The FAA may assess a 
civil penalty against any person acting in the capacity of a pilot, 
flight engineer, mechanic, or repairman for a violation of title III, 
V, VI, or XII or section 1101, or 1115(e)(2)(B) of the Federal Aviation 
Act of 1958, as amended, or any rule, regulation, or order issued 
thereunder, occurring on or after August 26, 1992, in accordance with 
section 901(a)(3) of the Federal Aviation Act of 1958, as amended (49 
U.S.C. App. 1471(a)(3), section 2(a) of the FAA Civil Penalty 
Administrative Assessment Act of 1992 (Pub. L. 102-345, 106 Stat. 923), 
and section 208 of the Airport and Airway Safety, Capacity, Noise 
Improvement, and Intermodal Transportation Act of 1992 (Pub. L. 102-
581, 106 Stat. 4872)).
    (ii) Violations of section 9308 or section 9309 of the Airport 
Noise and Capacity Act of 1990 (49 U.S.C. App. 2157 and 2158) or any 
regulation issued to carry out such sections are subject to the same 
civil penalties and procedures as are provided by title IX of the 
Federal Aviation Act of 1958, as amended, for violations of title VI, 
in accordance with section 9308(e) of the Airport Noise and Capacity 
Act of 1990 (49 U.S.C. App. 2157(e)).
    (iii) Notwithstanding the provisions of paragraphs (a)(1)(i) and 
(a)(1)(ii) of this section, the United States District Courts have 
exclusive jurisdiction of any civil penalty action initiated by the 
Administrator, in accordance with section 901(a)(3)(C) of the Federal 
Aviation Act of 1958, as amended (49 U.S.C. App. 1471(a)(3)(C))--
    (A) That involves an amount in controversy in excess of $50,000;
    (B) That is an in rem action or in which an in rem action is based 
on the same violation has been brought;
    (C) Regarding which an aircraft subject to lien has been seized by 
the United States; and
    (D) In which a suit for injunctive relief based on the violation 
giving rise to the civil penalty has also been brought.
    (2) Amount of civil penalties.--(i) Except as otherwise provided by 
statute, any person who violates any provision of title III, IV, V, VI, 
VII, or XII or of section 1101 or 1115(e)(2)(B) of the Federal Aviation 
Act of 1958, as amended, or any rule, regulation, or order issued 
thereunder, is subject to a civil penalty of not to exceed $1,000 for 
each such violation, in accordance with section 901(a)(1) of the 
Federal Aviation Act of 1958, as amended (49 U.S.C. App. 1471(a)(1)).
    (ii) Any person is subject to a civil penalty of not to exceed 
$10,000 for each violation that relates to registration or recordation 
of an aircraft under title V of the Federal Aviation Act of 1958, as 
amended, in accordance with section 901(a)(1) of the Federal Aviation 
Act of 1958, as amended (49 U.S.C. App. 1471(a)(1)).
    (b) Order of assessment. An order of assessment, which assesses a 
civil penalty, may be issued for a violation described in paragraph (a) 
of this section after notice and an opportunity to answer any charges 
and be heard as to why such order should not be issued.
    (c) Definitions. As used in this part, the following definitions 
apply:
    Flight engineer means a person who holds a flight engineer 
certificate issued under part 63 of this chapter.
    Mechanic means a person who holds a mechanic certificate issued 
under part 65 of this chapter.
    Person acting in the capacity of a pilot, flight engineer, 
mechanic, or repairman means a person acting in such capacity, whether 
or not that person holds the respective airman certificate issued by 
the FAA.
    Pilot means a person who holds a pilot certificate issued under 
part 61 of this chapter.
    Repairman means a person who holds a repairman certificate issued 
under part 65 of this chapter.
    (d) Delegation of authority. The authority of the Administrator, 
under section 901 of the Federal Aviation Act of 1958, as amended, to 
initiate and assess civil penalties for a violation of the Act, or a 
rule, regulation, or order issued thereunder, is delegated to the Chief 
Counsel, the Deputy Chief Counsel, the Assistant Chief Counsel for 
Enforcement, the Assistant Chief Counsel for each region and center. 
The authority of the Administrator to refer cases to the Attorney 
General of the United States, or the delegate of the Attorney General, 
for collection of civil penalties is delegated to the Chief Counsel, 
the Deputy Chief Counsel, the Assistant Chief Counsel for Enforcement, 
the Assistant Chief Counsel for Regulations, and the Assistant Chief 
Counsel for each region and center.
    (e) Notice of proposed assessment. A civil penalty action is 
initiated by sending a notice of proposed assessment to the person 
charged with a violation specified in paragraph (a) of this section. 
The notice of proposed assessment contains a statement of the charges 
and the amount of the proposed civil penalty. The person charged with a 
violation may do the following:
    (1) Submit the amount of the proposed civil penalty or an agreed-
upon amount, in which case either an order of assessment or a 
compromise order will be issued in that amount.
    (2) Answer the charges in writing.
    (3) Submit a written request for an informal conference to discuss 
the matter with an agency attorney and submit relevant information or 
documents.
    (4) Request that an order be issued in accordance with the notice 
of proposed assessment so that the person charged may appeal to the 
National Transportation Safety Board.
    (f) Appeal. Any person who receives an order of assessment issued 
under this section may appeal the order to the National Transportation 
Safety Board. The appeal stays the effectiveness of the Administrator's 
order.
    (g) Failure to respond to notice of proposed assessment. An order 
of assessment may be issued if the person charged with a violation 
fails to respond to the notice of proposed assessment within 15 days 
after receipt of that notice.
    (h) Payment. A person shall pay a civil penalty by sending a 
certified check or money order, payable to the Federal Aviation 
Administration, to the office identified by the agency attorney. The 
civil penalty must be paid within 30 days after service of the order of 
assessment, unless an appeal is filed with the National Transportation 
Safety Board. In such case, the civil penalty must be paid within 30 
days after a final order of the Board or the Court of Appeals that 
affirms the order of assessment in whole or in part.
    (i) Collection of civil penalties. If a person does not pay a civil 
penalty imposed by an order of assessment or a compromise order within 
60 days after service of the order, the Administrator may take action 
provided under the law to collect the penalty, including referring the 
order to the United States Attorney General, or delegate of the 
Attorney General, to begin proceedings to collect the civil penalty. 
The action is brought in a United States District Court, under the 
authority in section 903 of the Federal Aviation Act of 1958, as 
amended (49 U.S.C. App. 1473).
    (j) Exhaustion of administrative remedies. A party may petition for 
review only of a final decision and order of the National 
Transportation Safety Board to the courts of appeals of the United 
States or the United States Court of Appeals for the District of 
Columbia under section 1006 of the Federal Aviation Act of 1958, as 
amended. An order of assessment that has not been appealed to the 
National Transportation Board and an order compromising a civil penalty 
action may not be appealed under section 1006 of the Federal Aviation 
Act of 1958, as amended (49 U.S.C. App. 1486).
    (k) Compromise. The FAA may compromise any civil penalty action 
initiated in accordance with section 901 of the Federal Aviation Act of 
1958, as amended, at any time before referring the action to the United 
States Attorney General, or the delegate of the Attorney General, for 
collection.
    (1) An agency attorney may compromise any civil penalty action 
where a person charged with a violation agrees to pay a civil penalty 
and the FAA agrees to make no finding of violation. Under such 
agreement, a compromise order is issued following the payment of the 
agreed-upon amount or the signing of a promissory note. The compromise 
order states the following:
    (i) The person has paid a civil penalty or has signed a promissory 
note providing for installment payments;
    (ii) The FAA makes no finding of violation; and
    (iii) The compromise order will not be used as evidence of a prior 
violation in any subsequent civil penalty proceeding or certificate 
action proceeding.
    (2) An agency attorney may compromise the amount of any civil 
penalty proposed or assessed in an order.

    5. Section 13.201 is amended by removing paragraph (c) and revising 
paragraph (a) to read as follows:


Sec. 13.201  Applicability.

    (a) this subpart applies to all cases in which a hearing has been 
requested under Sec. 13.16.
* * * * *
    6. Section 13.233 is amended by revising the introductory text of 
paragraph (b), paragraphs (b)(1) and (b)(3), and the first sentence of 
the introductory text in paragraph (j), to read as follows:


Sec. 13.233  Appeal from initial decision.

    (a) * * *
    (b) Issues on appeal. In any appeal from a decision of an 
administrative law judge, the FAA decisionmaker considers only the 
following issues:
    (1) Whether each finding of fact is supported by a preponderance of 
reliable, probative, and substantial evidence;
    (2) * * *
    (3) Whether the administrative law judge committed any prejudicial 
errors that support the appeal.
* * * * *
    (j) FAA decisionmaker's decision on appeal. The FAA decisionmaker 
will review the record, the briefs on appeal, and the oral argument, if 
any, when considering the issues on appeal. * * *
* * * * *
    7. In Part 13 remove the words ``the Assistant Chief Counsel for 
Regulations and Enforcement'' and add, in their place, the words ``the 
Assistant Chief Counsel for Regulations, the Assistant Chief Counsel 
for Enforcement'' in the following places:
    (a) Sec. 13.15(b), (c)(1), and (c)(3);
    (b) Sec. 13.16(c), first and second sentences;
    (c) Sec. 13.19(b), the introductory text of (c), and the closing 
text of (c);
    (d) Sec. 13.21;
    (e) Sec. 13.25(a) and (b);
    (f) Sec. 13.71;
    (g) Sec. 13.73;
    (h) Sec. 13.81(a); and
    (i) Sec. 13.202, definition of Agency attorney.

    Issued in Washington, DC, on July 29, 1994.
Mark L. Gerchick,
Chief Counsel.
[FR Doc. 94-19120 Filed 8-4-94; 8:45 am]
BILLING CODE 4910-13-M