[Federal Register Volume 61, Number 201 (Wednesday, October 16, 1996)]
[Rules and Regulations]
[Pages 53998-54012]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-26180]



[[Page 53997]]


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Part II





Department of Transportation





_______________________________________________________________________



Federal Aviation Administration



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14 CFR Parts 13 and 16



Rules of Practice for Federally-Assisted Airport Proceedings; Final 
Rule

  Federal Register / Vol. 61, No. 201, Wednesday, October 16, 1996 / 
Rules and Regulations  

[[Page 53998]]



DEPARTMENT OF TRANSPORTATION

Federal Aviation Administration

14 CFR Parts 13 and 16

[Docket No. 27783; Amendment No. 13-27, 16]
RIN 2120-AF43


Rules of Practice for Federally-Assisted Airport Proceedings

AGENCY: Federal Aviation Administration (FAA), DOT.

ACTION: Final rule.

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SUMMARY: This rulemaking establishes rules of practice for filing 
complaints and adjudicating compliance matters involving Federally-
assisted airports. The rule addresses exclusively airport compliance 
matters arising under the Airport and Airway Improvement Act (AAIA) of 
1982, as amended; certain airport-related provisions of the Federal 
Aviation Act of 1994, as amended; the Surplus Property Act, as amended; 
predecessors to those acts; and regulations, grant agreements, and 
documents of conveyance issued or made under those acts. The rule is 
intended to expedite substantially the handling and disposition of 
airport-related complaints.

EFFECTIVE DATE: This rule is effective December 16, 1996.

FOR FURTHER INFORMATION CONTACT: Barry Molar or Frank J. San Martin, 
Airports Law Branch (AGC-610), Office of the Chief Counsel, (202) 267-
3473, Federal Aviation Administration, (FAA), 800 Independence Avenue, 
SW., Washington, DC 20591.

SUPPLEMENTARY INFORMATION:

Background

    A notice of proposed rulemaking (NPRM) for this rulemaking was 
issued on June 9, 1994 (59 FR 29880). The NPRM proposed to amend the 
FAA's existing complaint and adjudication procedures, 14 CFR Part 13, 
``Investigative and Enforcement Procedures,'' to remove from the 
coverage of part 13 the airport-related matters that will be handled 
under the new part 16. Certain disputes between U.S. and foreign air 
carriers and airport proprietors concerning the reasonableness of fees 
imposed by airport proprietors are not covered by the rule, but by 14 
CFR part 302, subpart F, pursuant to section 113 of the Federal 
Aviation Act of 1994 (FAAct), Public Law No. 103-305 (August 23, 1994), 
49 United States Code (U.S.C.) 47129.
    On September 16, 1994, the FAA published a notice to withdraw 
subpart J of the proposed rule, subpart J contained special procedures 
for handling airport fee complaints by air carriers [59 FR 47568]. The 
withdrawal became necessary with the passage of section 113 of the FAA 
Act, which contained specific provisions for airport fee complaints by 
air carriers that differed from, and were inconsistent with, subpart J. 
The withdrawal notice also extended the comment period for the 
remainder of the NPRM, subparts A through I, to December 1, 1994 [59 FR 
47568]

Discussion of Comments

    Sixteen commenters responded to the NPRM. Commenters included the 
Air Freight Association; Air Line Pilots Association (ALPA); Air Ottawa 
Flying Service, Inc.; Aircraft Owners and Pilots Association (AOPA); 
Airports Council International-North America (ACI-NA); American Car 
Rental Association (ACRA); Hawkins, Delafield & Wood; Hogan & Harston; 
Maryland Aviation Administration; Melbourne Airport Authority; National 
Association of State Aviation Officials (NASAO); National Business 
Aircraft Association, Inc. (NBAA); National Air Transportation 
Association (NATA); Newton & Associates, Inc. (NAI); Regional Airline 
Association (RAA); and the United States Parachute Association (USPA).
    Seven commenters generally support the promulgation of the proposed 
rule with some reservations. The remaining commenters address specific 
sections of the proposed rule.
    A discussion of the issues most widely addressed in the comments 
and an analysis of the final rule follows. All comments received were 
considered by the agency. The summary of comments is intended to 
represent the general divergence or correspondence in industry views on 
various issues, and is not intended to be an exhaustive restatement of 
the comments received. Comments pertaining to withdrawn subpart J will 
not be addressed.

Standing

    A number of commenters address issues concerning who should be able 
to file a complaint under new part 16. ACI-NA strongly supports 
limiting a complainant to a person ``directly and substantially 
affected by any alleged non-compliance,'' under proposed Sec. 16.23. 
Otherwise, ACI-NA argues, proceedings could be initiated by persons 
making only minimal use of an airport, burdening both the respondent 
and the FAA with the time and expense of administrative proceedings. 
AOPA states it is concerned that, under proposed Sec. 16.23, an 
association would not have standing to file a complaint on behalf of 
its individual members. ACRA requests clarification that a 
nonaeronautical user of an airport, such as a car rental company, could 
file a complaint under part 16.
    The final rule adopts the ``directly and substantially affected'' 
standard of the NPRM, with a special applicability provision for cases 
where review diversion is alleged. Under Sec. 16.23(a) of the final 
rule, a person directly and substantially affected by any alleged 
noncompliance may file a complaint with the Administrator. Under 
Sec. 16.3 of the final rule, a ``complaint'' is defined as ``a written 
document * * * filed with the FAA by a person directly and 
substantially affected by anything allegedly done or omitted to be done 
* * * in contravention of any provision of any Act, as defined in this 
section.'' Complaints by persons not ``directly and substantially 
affected'' by respondent's alleged noncompliance will be subject to 
dismissal with prejudice under part 16.
    Persons alleging revenue diversion by an airport, as defined in 49 
U.S.C. 47107(b), that do business with, and pay fees or rents to, the 
airport, are considered in the final rule to be directly and 
substantially affected by the alleged revenue diversion for the sole 
purpose of having and standing to file a revenue diversion complaint 
under Part 16. This special applicability provision for complaints of 
revenue diversion is necessary because revenue diversion principally 
affects the United States as the grantor of the federal airport funds 
allegedly diverted. However, entities that do business on the airport 
and pay fees to the airport have some interest in alleging revenue 
diversion because their payments constitute airport revenue.
    An association will have to meet the same ``directly and 
substantially affected'' standing requirement individually, but will be 
able to file a part 16 complaint as a representative of its members who 
are ``directly and substantially affected'' by an act or omission of 
respondent.
    The standing requirement is necessary to assure that scarce agency 
resources are devoted to matters in which the complainant's interest is 
sufficient to justify the burden of processing a complaint under part 
16. Parties who meet part 16 standing requirements may be represented 
by duly authorized representatives.
    Nonaeronautical users of airports are subject to the same 
``directly and substantially affected'' standard as aeronautical users, 
and could forseeably have standing to file a complaint under

[[Page 53999]]

part 16. For example, an airport duty-free shop could have standing to 
file a part 16 complaint alleging revenue diversion, and an airport 
concession that is a disadvantaged business enterprise (DBE) could have 
standing to file a part 16 complaint alleging non-compliance with the 
applicable DBE regulation. However, most of an airport's obligations 
are intended for the benefit of aeronautical users. A complaint 
alleging that an airport operator's treatment of a nonaeronautical user 
violates such obligation would be dismissed even though the 
nonaeronautical user was directly and substantially affected by the 
alleged practice. For example, the assurance against unjust 
discrimination by an airport operator only applies to aeronautical 
users, so a complaint by a nonaeronautical user alleging unjust 
discrimination by an airport operator would be dismissed.
    Notwithstanding, the standing requirement, complaints that are 
dismissed because complainant lacks standing under Part 16 may be 
referred by the FAA to the appropriate FAA region for consideration 
under Subpart D, Special Rules Applicable to Proceedings Initiated by 
the FAA.

Pre-complaint Resolution

    Most commenters approve of the proposed requirement in Sec. 16.21, 
that a person engage in good faith efforts to informally resolve a 
disputed matter, directly with the person or entity in alleged 
noncompliance, before filing a complaint. ACI-NA supports the proposed 
rule but is concerned that the mention of ``mediation, arbitration, or 
use of a dispute resolution board'' in Sec. 16.21 will be interpreted 
to mean that such alternative dispute resolution (ADR) methods are 
mandatory. AOPA suggests that the requirement to undertake informal 
resolution before filing a complaint would be inappropriate to 
complaints filed by general aviation and add to the costs and time to 
arrive at resolution. USPA states that part 16 would not permit contact 
with the FAA at the local level for assistance.
    Under Sec. 16.21 as adopted, it will be necessary for a potential 
complainant to certify that good faith efforts have been made to 
achieve informal resolution. However, the final rule does not require 
any particular informal resolution method, and mentions mediation, 
arbitration, and dispute resolution board as examples only. The final 
rule has been changed to add that the local FAA Airport District Office 
(ADO), or FAA Regional Airports Division, may be asked by the parties 
to assist them in resolving the dispute informally. That change is 
intended to make the local airports office available to mediate a 
dispute, and reflects the FAA's experience. In many cases, the 
involvement of the FAA ADO or regional airports division can facilitate 
informal resolution. Allegations of revenue diversion, however, may not 
lend themselves to full resolution in the pre-complaint process unless 
the proposed resolution addresses the total amounts allegedly diverted 
by the airport. Nevertheless, a complainant must show that informal 
resolution was attempted.

Hearing

    Section 16.31(d) provides the respondent with the opportunity for a 
hearing if the initial determination finds the respondent in 
noncompliance and proposes the issuance of a compliance order and an 
opportunity for a hearing required by statute. In all other cases no 
opportunity for a hearing is provided, except at the discretion of the 
agency.
    The law firm of Hogan & Hartson proposes a fact-finding hearing 
before the initial determination is issued in order to develop the 
factual record. This recommendation is not adopted in the final rule.
    Before issuing the initial determination, the FAA engages in the 
process of investigating a complain. While complainants are entitled to 
having their complaints investigated, they do not have a property 
interest sufficient to require an oral evidentiary hearing as part of 
that investigation, even when the investigation leads to a dismissal of 
a complaint.
    A respondent may be entitled to a hearing in some cases before the 
FAA takes adverse action. However, Sec. 16.31(d) provides an 
opportunity for a hearing in those cases after the initial 
determination is made and before any final agency action is taken. 
There is no need to provide a respondent with an additional oral 
evidentiary hearing during the investigatory stage. Furthermore, the 
factual record will be developed by the supporting documents that are 
required to be submitted with each pleading under Sec. 16.23, an by any 
additional information submitted by the parties or developed through 
informal investigation under Sec. 16.29.
    Several commenters argue that, contrary to Sec. 16.203(b)(1), which 
provides in the NPRM that the respondent and the agency are the only 
parties to the post-initial determination hearing, the complainant 
should also be a party to the hearing. The NBAA argues that a 
complainant should be a party to the hearing because the complainant's 
participation will help develop the record of the case. NATA and Air 
Ottawa Flying Service, Inc., argue that nonhearing party status for a 
complainant deprives the complainant of due process of law because the 
complainant may have property interests at stake.
    The final rule revised Sec. 16.203(b)(1) to allow complainant to be 
a party to a hearing along with the respondent and the agency. Under 
Sec. 16.31(d), a case proceeds to a hearing only after the FAA has 
found against the respondent in an initial determination that proposes 
the issuance of a compliance order. Thus, at the hearing the FAA has 
the burden of proof to establish the validity of its initial 
determination, including the proposed order of compliance under 
Sec. 16.109. The respondent is a party to the hearing who seeks 
reversal of the FAA's initial determination. Although, a complainant's 
status as an airport user alone does not give rise to a sufficient 
property interests to justify party status as a matter of right, party 
status for the complainant will permit it to have an opportunity to 
assist in the development of the factual record as pointed out by NBAA. 
In addition, providing automatic party status will avoid burdening the 
hearing officer and parties with routine requests for intervention by 
complainant. The rule provides the hearing officer with ample powers to 
control the conduct of the hearing and to assure that complainant's 
participation does not unduly delay the proceedings.
    As noted in the NPRM, in the case in which an adjudicatory hearing 
would be held (under Sec. 519 of the AAIA or Sec. 1002 of the FAA Act), 
the hearing procedures are intended to permit the FAA to complete 
compliance hearings within 180 days, while assuring that a respondent 
receives a fair hearing and an opportunity to present evidence and 
argument to support its position. Section 519 specifies that the FAA 
may temporarily withhold new grants.
    Several commenters object to proposed Sec. 16.3 which provides that 
the part 16 hearing officer is an attorney designated by the FAA. They 
state that the proposed provision gives the appearance and possibility 
of nonobjectivity. NBAA suggests that hearing officers be 
administrative law judges.
    The commenters' concerns about the independence and objectivity of 
an FAA designated hearing officer are misplaced. Under the terms of 
Sec. 16.3, no FAA attorney in the region where the noncompliance 
allegedly occurred, or in the Airports and Environmental Law

[[Page 54000]]

Division, may be a hearing officer. This excludes all FAA attorneys who 
could have access to factual knowledge of a part 16 complaint obtained 
by means other than the administrative record, insures that the hearing 
officer is independent of the offices that conduct investigations and 
prosecutions, and insures that the hearing officer is objective and 
independent.
    Further, section 519 by its terms requires the FAA to provide 
notice and ``an opportunity for hearing'' before imposing certain 
sanctions. The simple requirement for a hearing, without more, has been 
held not to constitute ``an adjudication required by statute to be 
determined on the record after opportunity for an agency hearing,'' 
within the meaning of section 554 of the Administrative Procedure Act 
(APA). See, e.g., Friends of the Earth v. EPA, 966 F.2d 690, 693 (D.C. 
Cir. 1992); St. Louis Fuel and Supply Co., Inc. v. FERC, 890 F.2d 446, 
448 (D.C. Cir. 1989). Accordingly, part 16 is not required by the APA 
to include all of the provisions of sections 554, 556 and 557 of the 
APA. In particular, the requirement that administrative law judges 
serve as hearing officers does not apply.
    In the interests of assuring a fair hearing, however, part 16 
includes many of the elements required by sections 554, 556 and 557 of 
the APA. For example, the hearing officer is required to issue an 
initial decision; ex parte communications are prohibited; separation of 
the prosecutorial and decision-making functions are required; and the 
hearing officer has virtually all of the authority specified in section 
556(c).

Intervention

    AOPA and NBAA comment that the intervention provisions of 
Sec. 16.207 are too restrictive and give the hearing officer too much 
discretion in admitting a new party to a hearing. As explained earlier, 
a part 16 hearing is to a large extent a proceeding in which the FAA 
acts as a prosecutor seeking an order of compliance under Sec. 16.109 
against respondent within the statutory time limits for issuing such 
actions. Furthermore, complainant will under the final rule be a party 
to the hearing. For these reasons, intervention in such a proceeding 
should only be allowed if it will not unnecessarily broaden the issues, 
or cause delay, and, if the person requesting intervention has 
interests that need to be protected.

Analysis of the Provisions of the Final Rule

    After careful review of the available data, including the comments 
received, the FAA has determined to adopt this proposed rule with the 
changes described previously.

Subpart A--General Provisions

    Subpart A includes provisions of general applicability to 
proceedings brought under part 16, definitions of terms used in the 
regulation, and a provision on separation of functions.
    The final rule modifies proposed Sec. 16.1(a) to exclude from the 
coverage of part 16 disputes between U.S. and foreign air carriers and 
airport-proprietors concerning the reasonableness of airport fees now 
covered by 14 CFR part 302, as mandated by Congress in the FAA Act, 
Public Law No. 103-305 (August 23, 1994).
    Proposed Sec. 16.1(d) is modified to specify that part 16 applies 
to investigations initiated by the FAA, as well as complaints filed 
with the FAA on or after the effective date of the rule.
    The definitions in Sec. 16.3 are, for the most part, derived from 
the definitions of like or similar terms in 14 CFR part 13. The term 
``agency employee'' defined as any employee of the Department of 
Transportation, was added to indicate that other offices within the 
Department of Transportation may assist the FAA in part 16 cases.
    The title of ``Assistant Administrator for Airports'' in the 
definitions section and throughout the text of the rule has been 
changed in the final rule to ``Associate Administrator for Airports'' 
to reflect the correct title for this FAA official, as changed by a 
recent agency reorganization.
    The term ``Director,'' defined as the Director of the Office of 
Airport Safety and Standards, was added to the definitions section and 
to the text of the rule. The ``Director'' replaces the ``Assistant 
Administrator'' as the decisionmaker of the initial determination 
without a hearing under Sec. 16.31, as discussed more fully herein.
    Although not technically incorrect, the term ``FAA decisionmaker'' 
was deleted from the definitions section and text of the final rule 
because the term is unnecessary. Deletion of the term should avoid 
confusion surrounding the ultimate decisionmaker in appeals from 
initial determinations of the Director without a hearing under 
Sec. 16.31, and from the initial decisions of hearing officers after a 
hearing under Sec. 16.241. In both cases, the appeal will be submitted 
to the Associate Administrator, who will issue a final decision under 
either Sec. 16.33 or Sec. 16.241.
    The substitution of Director and Associate Administrator as 
decisionmakers instead of higher-level officials reflects the concerns 
and experiences of agency personnel who reviewed the proposed rule. The 
Director and Associate Administrator are experienced in airport matters 
and may be more accessible within the short time periods in the final 
rule for issuing decisions. The substitution also conforms more closely 
to current practice in deciding complaints regarding airport 
compliance.
    The term ``Presiding officer'' was deleted from the definitions 
section because it was referred to only in subpart J, which was 
withdrawn.
    The final rule contains no changes to the separation of function 
section, Sec. 16.5, except that ``Associate Administrator'' replaces 
``Administrator'' in Sec. 16.5(b) and ``FAA decisionmaker'' in 
Sec. 16.5(c).
    Separation of functions is not required by statute because hearings 
under part 16 are not subject to APA hearing requirements; however, the 
separation is provided to promote confidence in the impartiality and 
integrity of decisions under the new procedures. Separation of 
prosecutorial and adjudicatory functions will be provided from the time 
the Director's determination is issued in all cases in which an 
opportunity for hearing is provided, including cases in which the 
respondent waives hearing and appeals the Director's determination in 
writing to the Associate Administrator. When separation applies, the 
Director will be considered as performing the investigatory and 
prosecutorial function and will not participate in the decision of the 
Associate Administrator or hearing officer.

Subpart B--General Rules Applicable to Complaints, Proceedings, and 
Appeals Initiated by the FAA

    This subpart applies to all phases of the investigations and 
adjudications under this part.
    The provisions governing filing and service of documents, 
computation of time, and motions (Secs. 16.13, 16.15, 16.17, and 
16.19), are based on similar provisions in the Federal Rules of Civil 
Procedure, the Department of Transportation's Rules of Practice in 
Proceedings (14 CFR part 302), the FAA Rules of Practice in Civil 
Penalty Actions (14 CFR part 13, subpart G), and the National 
Transportation Safety Board's (NSTB) Rules of Practice in Air Safety 
Proceedings (49 CFR part 821). The proposed rule was modified to change 
the agency address in Sec. 16.13. To insure timely processing and to 
reflect

[[Page 54001]]

changes in the organization of the Office of the Chief Counsel ``FAA 
Part 16 Airport Proceedings Docket (AGC-600)'' replaces ``FAA 
Enforcement Docket (AGC-10).'' The additional 5 days provided after 
service on a party of a document by mail was changed to 3 days in 
Sec. 16.17(c). This revision conforms to the ``mail rule'' used in 
federal practice under the Federal Rules of Civil Procedure.

Subpart C--Special Rules Applicable to Complaints

    The final rule requires, under Sec. 16.21, a potential complainant 
to engage in good faith efforts to resolve the disputed matter 
informally with potentially responsible respondents before filing a 
complaint with the FAA under part 16. Informal resolution may include 
mediation, arbitration, use of a dispute resolution board, or other 
form of third-party assistance, including assistance from the 
responsible FAA Airports District Office or FAA Regional Airports 
Division.
    Under Sec. 16.21, it will be necessary for the potential 
complainant or its representative to certify that good faith efforts 
have been made to achieve informal resolution. To protect the parties 
and for consistency with Rule 408 of the Federal Rules of Evidence, the 
certification will not include information on monetary or other 
settlement offers made but not agreed upon in writing. As explained 
earlier, under Sec. 16.21(a), the FAA ADO or Regional Airports 
Division, will be available upon request to assist the parties with 
informal resolution.
    The final rule retains the requirement that a complainant be 
``directly and substantially affected by any alleged noncompliance'' in 
order to have standing to file a complaint under Sec. 16.23. However, 
as explained above complainants alleging revenue diversion by an 
airport will be considered to be directly and substantially affected by 
the alleged revenue diversion, if complainants do business with the 
airport and pay fees or rentals to the airport.
    To provide a more efficient and expedited process the time periods 
for filing a reply to the answer and a rebuttal to the reply in 
Sec. 16.23 (e) and (f) were reduced from 15 to 10 days.
    At the suggestion of one commenter, the final rule adds ``lack of 
standing'' as another possible ground for dismissal with prejudice 
under Sec. 16.25. Besides dismissal of complaints that clearly do not 
state a cause of action, or those that do not come within the 
jurisdiction of the Administrator, a complaint may also be dismissed if 
the complainant lacks standing to file the complaint under Secs. 16.3 
and 16.23. As a final order of the agency, a dismissal with prejudice 
would be appealable to a United States Court of Appeals.
    As explained above, the final rule substitutes the Director of the 
Office of Airport Safety and Standards as the official who makes the 
initial determination after investigation under Sec. 16.31. The 
Director would issue an initial determination in every case in which 
the FAA investigates a complaint. Under the final rule, the agency is 
required to issue a Director's determination in 120 days from the due 
date of the last pleading (i.e., reply or rebuttal). The provision in 
the NPRM allowing the Director to extend the period for issuing an 
initial determination by 60 days for good cause was deleted from the 
final rule in order to further expedite this administrative complaint 
procedure.
    The Director's determination is intended to provide a timely and 
authoritative indication of the agency's position on a complaint. While 
the Director's determination can be appealed to the Associate 
Administrator under Sec. 16.33, the FAA expects that, in many 
instances, the Director's determination will resolve the issues raised 
in the complaint to the satisfaction of the parties. In such cases, the 
parties may find it more beneficial to negotiate a solution based on 
the FAA's initial position than to continue to litigate the matter.
    Under the final rule, the Associate Administrator will issue the 
final decision on appeal from a Director's determination without a 
hearing under Sec. 16.33. If the initial determination finds the 
sponsor in compliance and dismisses the complaint, the complainant may 
appeal the determination by a written appeal to the Associate 
Administrator within 30 days. The Associate Administrator is required 
to issue a final agency decision in an appeal by a complainant within 
60, not 30 days of the due date for the reply brief, as proposed in the 
NPRM. The additional time for issuing a final agency decision was added 
to the final rule to assure the agency adequate time to review the 
record, prepare, and issue a final decision.
    If the Director's determination contains a finding of noncompliance 
and the respondent is entitled to a hearing, the determination will 
provide the sponsor the opportunity to elect an oral evidentiary 
hearing under subpart F. The procedure for electing or waiving a 
hearing is set forth in subpart E. If the respondent waives a hearing 
and instead elects to file a written appeal to the Associate 
Administrator, a final decision will be issued by the Associate 
Administrator under Sec. 16.33.

Subpart D--Special Rules Applicable to Proceedings Initiated by the FAA

    Section 16.101 makes clear the FAA's continuing authority to 
initiate its own investigation of any matter within the applicability 
of this part without having received a complaint, as authorized by 
Secs. 313 and 1002 of the FAA Act and Sec. 519 of the AAIA.

Subpart E--Proposed Orders of Compliance

    Subpart E contains procedures that provide the respondent an 
opportunity to file a request for hearing within 20 days after service 
of the Director's determination if the determination proposes a 
sanction against the sponsor subject to Sec. 519(b) of the AAIA or 
Sec. 1002 of the FAA Act. The 20-day period to file a request for 
hearing was reduced from 30 days in the NPRM in order to provide a more 
efficient and expedited process. If the respondent elects a hearing, 
the agency will issue a hearing order.
    Alternatively, if the respondent waives hearing and instead files a 
written appeal (within 30 days), the Associate Administrator will issue 
a final decision in accordance with the procedures set forth in 
Sec. 16.33. If the respondent fails to respond to the Director's 
determination, the initial determination becomes final.
    The final rule, based on comments received, includes a new ground 
for the agency to provide the opportunity for a hearing under 
Sec. 16.109(a): If the agency proposes to issue an order withholding 
approval of any new application to impose a passenger facility charge 
pursuant to Sec. 112 of the FAA Act, 49 U.S.C. 47111(e). That new 
statutory section creates additional enforcement mechanisms against 
illegal revenue diversion including the withholding of a new 
application to impose a passenger facility charge. The statute requires 
the FAA to provide an opportunity for hearing before imposing this 
sanction.
    The opportunity for a hearing by the agency under part 16 is 
limited to those cases where there is a statutory requirement to offer 
the opportunity for a hearing before the FAA takes a particular action, 
or specific cases in which the FAA elects to offer a hearing.
    Section 16.109(b)(3) allows respondent and complainant to file a 
joint motion to withdraw the complaint and dismiss the proposed 
compliance action. The FAA may, subject to its discretion, grant the 
motion if it finds that a settlement by the parties fully

[[Page 54002]]

resolves the complaint violation and further compliance action is not 
necessary.

Subpart F--Hearings

    Subpart F contains the procedures for initiating and conducting 
adjudicative hearings. The hearing order, issued by the Deputy Chief 
Counsel under Sec. 16.201, will set the scope of the hearing by 
identifying the issues to be resolved, as well as assigning the hearing 
officer. If no material facts that require oral examination of 
witnesses are in dispute, the hearing may be limited to submission of 
briefs and oral argument.
    In the hearing, the agency attorney will represent the agency's 
position before the hearing officer and will have the same status as 
any other representatives of a party. The rule includes commonly used 
adjudicatory procedures, such as representation of the parties by 
attorneys, intervention, participation by non-parties, pretrial 
procedures and discovery, the availability of compulsory process to 
obtain evidence, and procedures for using at the hearing. These 
provisions are intended to provide the parties with a reasonable 
opportunity to prepare their cases, while allowing the process to be 
completed expeditiously. To assure an expeditious hearing process, 
paragraph (b) was added to Sec. 16.213, discovery, to emphasize the 
hearing officer's authority and duty to limit discovery wherever 
feasible.
    The final rule made the following clarifications and corrections to 
the subpart based on comments received. The final rule added ``or 
notice of investigation'' to Sec. 16.201(1) to clarify that the 
provisions of subpart F may apply to proceedings initiated by the FAA 
under subpart D. The final rule deleted an incorrect citation in 
Sec. 16.203(a)(2) and replaced it with a citation to Sec. 16.13.
    In the NPRM, the last phrase in proposed Sec. 16.209(d) cited 
section 519(b) of the AAIA. The citation to the AAIA was included 
because the AAIA provision contains the 180-day time limitation for a 
determination which could affect the length of extensions of time 
granted under part 16. (Although, at this time, the FAA does not 
foresee any circumstances where it would provide for a hearing and 
section 519(b) of the AAIA would not be applicable, in a case not 
covered by section 519(b), an extension of time by the hearing officer 
for any reason could extend all of the due dates beyond the 180-day 
time limitation.) This provision is being modified in the final rule to 
clarify this point.
    The provisions of Sec. 16.233 on evidence, in part, are to permit 
the hearing officer to exercise control over the hearing. Contrary to 
the suggestion of one commenter, they are not intended to authorize the 
hearing officer to preclude all cross-examination of a witness.
    In keeping with the time limitations imposed by section 519(b) of 
the AAIA, Sec. 16.235(a) of the final rule retains the provision 
permitting the hearing officer to allow written argument during the 
hearing only if the hearing officer finds that such argument would not 
delay the hearing. Parties may make their arguments in posthearing 
briefs under Sec. 16.235(b).

Subpart G--Initial Decisions, Orders and Appeals

    Subpart G provides procedures for issuance of initial decisions and 
orders by hearing officers, appeals of the initial decision to the 
Associate Administrator for Airports, and issuance of consent orders.
    Section 16.241 governs procedures and time frames for initial 
decisions and administrative appeals based on 14 CFR 13.20(g)-(i). 
However, shorter time periods are provided to accommodate the time 
limits of Sec. 519 of the AAIA. In appeals from initial decisions of 
hearing officers, under Sec. 16.241(c) and 16.241(f)(2), the Associate 
Administrator must issue the final agency decision within 30 days of 
the due date of the reply. This provision insures that the final agency 
decision is issued within the 180-day time period of section 519.
    In addition, the rule includes a provision for sua sponte review of 
an initial decision by the Associate Administrator, consistent with the 
practice under 14 CFR 302.28(d).
    Section 16.243 governing disposal of cases by consent orders is 
derived from 14 CFR 13.13.
    As explained above, the final rule replaced all references to the 
``FAA decisionmaker,'' though technically correct, with the ``Associate 
Administrator,'' to avoid confusion and clarify. The ultimate 
decisionmaker in part 16 proceedings, with or without hearings, is the 
Associate Administrator for Airports for the reasons previously given.

Subpart H--Judicial Review

    Subpart H contains rules applicable to judicial review of final 
agency orders. Section 16.247(a) sets forth the basic authority to seek 
judicial review. The provision is based on 14 CFR 13.235. Specific 
reference to section 519(b)(4) of the AAIA has been added. Section 
16.247(b) identifies FAA decisions and actions under part 16 that the 
FAA does not consider to be judicially reviewable final agency orders.

Subpart I--Ex Parte Communications

    The rule on ex parte communications is based on subpart J of the 
Rules of Practice in Air Safety Proceedings of the NTSB, 49 CFR Part 
821, subpart J, modified to reflect the fact that FAA employees 
function as both parties and decisional employees in hearings conducted 
under subpart F of part 16.

Subpart J--Alternative Procedure for Certain Complaints Concerning 
Airport Rates and Charges

    As explained above, subpart J of the proposed rule, containing 
special procedures for the handling of airport fee complaints by U.S. 
and foreign air carriers, was withdrawn on September 16, 1994 [59 FR 
47568].

Regulatory Evaluation Summary

Introduction

    This regulatory evaluation examines the costs and benefits of the 
final rule concerning Rules for Federally-Assisted Airport Proceedings. 
The rule establishes rules of practice for filing complaints and 
adjudicating compliance matters involving Federally-assisted airports. 
The rule is intended to expedite substantially the handling and 
disposition of airport-related complaints. Since the impacts of the 
changes are relatively minor this economic summary constitutes the 
analysis and no regulatory evaluation will be placed in the docket.
    Changes to Federal regulations must undergo several economic 
analyses. First, Executive Order 12866 directs that each Federal agency 
shall propose or adopt a regulation only upon a reasoned determination 
that the benefits of the intended regulation justify its costs. Second, 
the Regulatory Flexibility Act of 1980 requires agencies to analyze the 
economic effect of regulatory changes on small entities. Third, the 
Office of Management and Budget directs agencies to assess the effects 
of regulatory changes on international trade. In conducting these 
analyses, the FAA has determined that this rule is ``a significant 
regulatory action'' as defined in the Executive Order and the 
Department of Transportation Regulatory Policies and Procedures. This 
rule would not have a significant impact on a substantial number of 
small entities and would not constitute a barrier to international 
trade.

[[Page 54003]]

Costs And Benefits

    This final rule adopts a new procedure for the filing, 
investigation, and adjudication of complaints against airports for 
violation of certain statutes administered by the FAA. The new 
procedures will substitute for existing procedures under 14 CFR part 
13. There are no intended safety benefits that result from this rule. 
The intended advantages of the rule are in the form of increased cost 
effectiveness and timeliness in resolving complaints. The rule will use 
FAA resources better and result in modest cost savings.
    About 30 investigations are initiated per year due to complaints 
filed with the FAA. Each investigation takes an average of 3 years 
before a ruling is issued. The typical investigation requires a field 
investigation, an initial review by the FAA's Office of Airports Safety 
and Standards, and a legal review by an attorney in the Office of Chief 
Counsel. A GS-12 (step 5) employee requires 30 hours to complete the 
field investigation, a GS-13 (step 5) requires 30 hours to complete the 
initial review, and a GS-14 (step 5) employee requires 20 hours to 
complete the legal review. The average cost per investigation is 
$3,100. (See Table 1.)

                           Table 1.--Cost of Investigations Current and Under New Rule                          
----------------------------------------------------------------------------------------------------------------
                                                            Average    Yearly     Hourly     Loaded             
                                                    Hours    grade     salary      rate       rate       Cost   
----------------------------------------------------------------------------------------------------------------
                CURRENT SITUATION                                                                               
                                                                                                                
Field investigation..............................      35     GS-12    $50,388     $24.14     $31.39   $1,098.54
Initial review at HQ.............................      30     GS-13     59,917      28.71      37.32    1,119.68
Attorney review at HQ............................      20     GS-14     70,804      33.93      44.10      882.08
                                                  ==============================================================
Average cost per investigation......................................................................     $3,100 
Average annual number of investigations.............................................................          30
                                                  ---------                                                     
Average annual cost of investigations...............................................................    $93,009 
                                                                                                                
                  NEW SITUATION                                                                                 
                                                                                                                
Field............................................       4     GS-12    $50,388     $24.14     $31.39     $125.55
Initial review at HQ.............................      40     GS-13     59,917      28.71      37.32    1,492.90
Attorney review at HQ............................      20     GS-14     70,804      33.93      44.10      882.08
                                                  ==============================================================
Average cost per investigation......................................................................     $2,501 
Average annual number of investigations.............................................................          30
                                                  ---------                                                     
Average annual cost of investigations...............................................................    $75,016 
Savings.............................................................................................     $17,993
----------------------------------------------------------------------------------------------------------------

This number assumes a 30-percent loaded hourly rate for fringe 
benefits. The annual cost of investigations is estimated to be $93,000.
    Under the new rule, determinations will be made without the need 
for a field investigation. The FAA will be able to decide the merits of 
the case by looking at the record solely. The field investigation is 
expected to require 4 hours of the GS-12 (step 5) employee time, mostly 
to complete the proper forms; the initial review at headquarters is 
expected to require 40 hours of the GS-13 (step 5) employee's time, and 
the legal review is expected to remain at 20 hours of the GS-14 (step 
5) employee's time. The average cost per investigation is estimated to 
be $2,500 and the annual cost of investigations will be $75,000 (Table 
1). The final rule will result in an average cost savings of $18,000 
per year on investigations. Furthermore the FAA estimates that instead 
of 3 years per investigation, each investigation will now take on 
average 1 year.

Conclusion

    The FAA has determined that the final rule would have only moderate 
economic impacts on the industry, public, or government. The only 
measurable economic impact the FAA estimates is a slight cost savings 
to administer airport proceedings due to the utilization of government 
resources in a more efficient manner. The FAA finds that the proposed 
rule is cost-beneficial.

International Trade Impact Assessment

    The Office of Management and Budget directs agencies to assess the 
effects of regulatory changes on international trade. There should be 
no effect on aircraft manufacturers or operators (U.S. or foreign). 
Therefore, the FAA has determined that the proposed rule would neither 
have an effect on the sale of foreign aviation products nor services in 
the United States, nor would it have an effect on the sale of U.S. 
products or services in foreign countries.

Regulatory Flexibility Determination

    The Regulatory Flexibility Act (RFA) of 1980 was enacted by 
Congress to ensure that small entities are not unnecessarily or 
disproportionately burdened by Government regulations. The RFA requires 
a Regulatory Flexibility Analysis if a rule would have a significant 
economic impact, either detrimental or beneficial, on a substantial 
number or small entities. Based on the potential relief that the rule 
provides and the criteria contained in FAA Order 2100.14A, Regulatory 
Flexibility Criteria and Guidance, the FAA has determined that the rule 
will not have a significant economic impact on a substantial number of 
small entities.

Federalism Implications

    The regulations adopted herein will 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. Therefore, in 
accordance with Executive Order 12612, it is determined that this final 
rule does not have sufficient federalism implications to warrant the 
preparation of a Federalism Assessment.

Paperwork Reduction Act

    This final rule contains no information collection requirements 
that require approval of the Office of Management and Budget pursuant 
to the Paperwork Reduction Act of 1980 (44 U.S.C. 3507 et seq.)

[[Page 54004]]

Conclusion

    For the reasons discussed in the preamble, and based on the 
findings in the Regulatory Flexibility Determination and the 
International Trade Analysis, the FAA has determined that this final 
rule is not economically significant under Executive Order 12866. This 
final rule is considered significant under DOT Regulatory Policies and 
Procedures (44 FR 111034, February 26, 1979) and Executive Order 12866. 
The FAA certifies that this final rule 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

14 CFR Part 13

    Enforcement procedures, Investigations, Penalties.

14 CFR Part 16

    Enforcement procedures, Investigations.

The Amendments

    Accordingly, the Federal Aviation Administration amends chapter I 
of title 14 of the Code of Federal Regulations as follows:

PART 13--INVESTIGATIVE AND ENFORCEMENT PROCEDURES

    1. The authority citation for part 13 continues to read as follows:
    Authority: 18 U.S.C. 6002; 49 U.S.C. 106(g), 5121-5124, 40113-
40114, 44103-44106, 44702-44703, 44709-44710, 44713, 46101-46110, 
46301-46316, 46501-46502, 46504-46507, 47106, 47111, 47122, 47306, 
47531-47532.

    2. Section 13.3 is amended by adding a new paragraph (d) to read as 
follows:


Sec. 13.3  Investigations (general).

* * * * *
    (d) A complaint against the sponsor, proprietor, or operator of a 
Federally-assisted airport involving violations of the legal 
authorities listed in Sec. 16.1 of this chapter shall be filed in 
accordance with the provisions of part 16 of this chapter, except in 
the case of complaints, investigations, and proceedings initiated 
before December 16, 1996, the effective date of part 16 of this 
chapter.
    3. A new part 16 is added to subchapter B to read as follows:

PART 16--RULES OF PRACTICE FOR FEDERALLY-ASSISTED AIRPORT 
ENFORCEMENT PROCEEDINGS

Subpart A--General Provisions

Sec.
16.1  Applicability and description of part.
16.3  Definitions.
16.5  Separation of functions.

Subpart B--General Rules Applicable to Complaints, Proceedings 
Initiated by the FAA, and Appeals

16.11  Expedition and other modification of process.
16.13  Filing of documents.
16.15  Service of documents on the parties and the agency.
16.17  Computation of time.
16.19  Motions.

Subpart C--Special Rules Applicable to Complaints

16.21  Pre-complaint resolution.
16.23  Complaints, answers, replies, rebuttals, and other documents.
16.25  Dismissals.
16.27  Incomplete complaints.
16.29  Investigations.
16.31  Director's determinations after investigations.
16.33  Final decisions without hearing.

Subpart D--Special Rules Applicable to Proceedings Initiated by the FAA

16.101  Basis for the initiation of agency action.
16.103  Notice of investigation.
16.105  Failure to resolve informally.

Subpart E--Proposed Orders of Compliance

16.109  Orders terminating eligibility for grants, cease and desist 
orders, and other compliance orders.

Subpart F--Hearings

16.201  Notice and order of hearing.
16.202  Powers of a hearing officer.
16.203  Appearances, parties, and rights of parties.
16.207  Intervention and other participation.
16.209  Extension of time.
16.211  Prehearing conference.
16.213  Discovery.
16.215  Depositions.
16.217  Witnesses.
16.219  Subpoenas.
16.221  Witness fees.
16.223  Evidence.
16.225  Public disclosure of evidence.
16.227  Standard of proof.
16.229  Burden of proof.
16.231  Offer of proof.
16.233  Record.
16.235  Argument before the hearing officer.
16.237  Waiver of procedures.

Subpart G--Initial Decisions, Orders and Appeals

16.241  Initial decisions, orders, and appeals.
16.243  Consent orders.

Subpart H--Judicial Review

16.247  Judicial review of a final decision and order.

Subpart I--Ex Parte Communications

16.301  Definitions.
16.303  Prohibited ex parte communications.
16.305  Procedures for handling ex parte communications.
16.307  Requirement to show cause and imposition of sanction.

    Authority: 49 U.S.C. 106(g), 322, 1110, 1111, 1115, 1116, 1718 
(a) and (b), 1719, 1723, 1726, 1727, 40103(e), 40113, 40116, 
44502(b), 46101, 46104, 46110, 47104, 47106(e), 47107, 47108, 
47111(d), 47122, 47123-47125, 47151-47153, 48103.

Subpart A--General Provisions


Sec. 16.1  Applicability and description of part.

    (a) General. The provisions of this part govern all proceedings 
involving Federally-assisted airports, except for disputes between U.S. 
and foreign air carriers and airport proprietors concerning the 
reasonableness of airport fees covered by 14 CFR part 302, whether the 
proceedings are instituted by order of the FAA or by filing with the 
FAA a complaint, under the following authorities:
    (1) 49 U.S.C. 40103(e), prohibiting the grant of exclusive rights 
for the use of any landing area or air navigation facility on which 
Federal funds have been expended (formerly section 308 of the Federal 
Aviation Act of 1958, as amended).
    (2) Requirements of the Anti-Head Tax Act, 49 U.S.C. 40116.
    (3) The assurances contained in grant-in-aid agreements issued 
under the Federal Airport Act of 1946, 49 U.S.C. 1101 et seq (repealed 
1970).
    (4) The assurances contained in grant-in-aid agreements issued 
under the Airport and Airway Development Act of 1970, as amended, 49 
U.S.C. 1701 et seq.
    (5) The assurances contained in grant-in-aid agreements issued 
under the Airport and Airway Improvement Act of 1982 (AAIA), as 
amended, 49 U.S.C. 47101 et seq., specifically section 511(a), 49 
U.S.C. 47107(a) and (b).
    (6) Section 505(d) of the Airport and Airway Improvement Act of 
1982, as amended, 49 U.S.C. 47113.
    (7) Obligations contained in property deeds for property 
transferred pursuant to section 16 of the Federal Airport Act (49 
U.S.C. 1115), section 23 of the Airport and Airway Development Act (49 
U.S.C. 1723), or section 516 of the Airport and Airway Improvement Act 
(49 U.S.C. 47125).
    (8) Obligations contained in property deeds for property 
transferred under the Surplus Property Act (49 U.S.C. 47151-47153).
    (b) Other agencies. Where a grant assurance concerns a statute, 
executive

[[Page 54005]]

order, regulation, or other authority that provides an administrative 
process for the investigation or adjudication of complaints by a 
Federal agency other than the FAA, persons shall use the administrative 
process established by those authorities. Where a grant assurance 
concerns a statute, executive order, regulation, or other authority 
that enables a Federal agency other than the FAA to investigate, 
adjudicate, and enforce compliance under those authorities on its own 
initiative, the FAA may defer to that Federal agency.
    (c) Other enforcement. If a complaint or action initiated by the 
FAA involves a violation of the 49 U.S.C. subtitle VII or FAA 
regulations, except as specified in paragraphs (a)(1) and (a)(2) of 
this section, the FAA may take investigative and enforcement action 
under 14 CFR part 13, ``Investigative and Enforcement Procedures.''
    (d) Effective date. This part applies to a complaint filed with the 
FAA and to an investigation initiated by the FAA on or after December 
16, 1996.


Sec. 16.3  Definitions.

    Terms defined in the Acts are used as so defined. As used in this 
part:
    Act means a statute listed in Sec. 16.1 and any regulation, 
agreement, or document of conveyance issued or made under that statute.
    Agency attorney means the Deputy Chief Counsel; the Assistant Chief 
Counsel and attorneys in the Airports/Environmental Law Division of the 
Office of the Chief Counsel; the Assistant Chief Counsel and attorneys 
in an FAA region or center who represent the FAA during the 
investigation of a complaint or at a hearing on a complaint, and who 
prosecute on behalf of the FAA, as appropriate. An agency attorney 
shall not include the Chief Counsel; the Assistant Chief Counsel for 
Litigation, or any attorney on the staff of the Assistant Chief Counsel 
for Litigation, who advises the Associate Administrator regarding an 
initial decision of the hearing officer or any appeal to the Associate 
Administrator or who is supervised in that action by a person who 
provides such advice in an action covered by this part.
    Agency employee means any employee of the U.S. Department of 
Transportation.
    Associate Administrator means the Associate Administrator for 
Airports or a designee.
    Complainant means the person submitting a complaint.
    Complaint means a written document meeting the requirements of this 
part filed with the FAA by a person directly and substantially affected 
by anything allegedly done or omitted to be done by any person in 
contravention of any provision of any Act, as defined in this section, 
as to matters within the jurisdiction of the Administrator.
    Director means the Director of the Office of Airport Safety and 
Standards.
    Director's determination means the initial determination made by 
the Director following an investigation, which is a non-final agency 
decision.
    File means to submit written documents to the FAA for inclusion in 
the Part 16 Airport Proceedings Docket or to a hearing officer.
    Final decision and order means a final agency decision that 
disposes of a complaint or determines a respondent's compliance with 
any Act, as defined in this section, and directs appropriate action.
    Hearing officer means an attorney designated by the FAA in a 
hearing order to serve as a hearing officer in a hearing under this 
part. The following are not designated as hearing officers: the Chief 
Counsel and Deputy Chief Counsel; the Assistant Chief Counsel and 
attorneys in the FAA region or center in which the noncompliance has 
allegedly occurred or is occurring; the Assistant Chief Counsel and 
attorneys in the Airports and Environmental Law Division of the FAA 
Office of the Chief Counsel; and the Assistant Chief Counsel and 
attorneys in the Litigation Division of the FAA Office of Chief 
Counsel.
    Initial decision means a decision made by the hearing officer in a 
hearing under subpart F of this part.
    Mail means U.S. first class mail; U.S. certified mail; and U.S. 
express mail.
    Noncompliance means anything done or omitted to be done by any 
person in contravention of any provision of any Act, as defined in this 
section, as to matters within the jurisdiction of the Administrator.
    Party means the complainant(s) and the respondent(s) named in the 
complaint and, after an initial determination providing an opportunity 
for hearing is issued under Sec. 16.31 and subpart E of this part, the 
agency.
    Person in addition to its meaning under 49 U.S.C. 40102(a)(33), 
includes a public agency as defined in 49 U.S.C. 47102(a)(15).
    Personal delivery means hand delivery or overnight express delivery 
service.
    Respondent means any person named in a complaint as a person 
responsible for noncompliance.
    Sponsor means:
    (1) Any public agency which, either individually or jointly with 
one or more other public agencies, has received Federal financial 
assistance for airport development or planning under the Federal 
Airport Act, Airport and Airway Development Act or Airport and Airway 
Improvement Act;
    (2) Any private owner of a public-use airport that has received 
financial assistance from the FAA for such airport; and
    (3) Any person to whom the Federal Government has conveyed property 
for airport purposes under section 13(g) of the Surplus Property Act of 
1944, as amended.


Sec. 16.5  Separation of functions.

    (a) Proceedings under this part, including hearings under subpart F 
of this part, will be prosecuted by an agency attorney.
    (b) After issuance of an initial determination in which the FAA 
provides the opportunity for a hearing, an agency employee engaged in 
the performance of investigative or prosecutorial functions in a 
proceeding under this part will not, in that case or a factually 
related case, participate or give advice in an initial decision by the 
hearing officer, or a final decision by the Associate Administrator or 
designee on written appeal, and will not, except as counsel or as 
witness in the public proceedings, engage in any substantive 
communication regarding that case or a related case with the hearing 
officer, the Associate Administrator on written appeal, or agency 
employees advising those officials in that capacity.
    (c) The Chief Counsel, the Assistant Chief Counsel for Litigation, 
or an attorney on the staff of the Assistant Chief Counsel for 
Litigation advises the Associate Administrator regarding an initial 
decision, an appeal, or a final decision regarding any case brought 
under this part.

Subpart B--General Rules Applicable to Complaints, Proceedings 
Initiated by the FAA, and Appeals


Sec. 16.11  Expedition and other modification of process.

    (a) Under the authority of 49 U.S.C. 40113 and 47121, the Director 
may conduct investigations, issue orders, and take such other actions 
as are necessary to fulfill the purposes of this part, including the 
extension of any time period prescribed where necessary or appropriate 
for a fair and complete hearing of matters before the agency.
    (b) Notwithstanding any other provision of this part, upon finding 
that circumstances require expedited handling of a particular case or 
controversy, the Director may issue an

[[Page 54006]]

order directing any of the following prior to the issuance of the 
Director's determination:
    (1) Shortening the time period for any action under this part 
consistent with due process;
    (2) If other adequate opportunity to respond to pleadings is 
available, eliminating the reply, rebuttal, or other actions prescribed 
by this part;
    (3) Designating alternative methods of service; or
    (4) Directing such other measures as may be required.


Sec. 16.13  Filing of documents.

    Except as otherwise provided in this part, documents shall be filed 
with the FAA during a proceeding under this part as follows:
    (a) Filing address. Documents to be filed with the FAA shall be 
filed with the Office of the Chief Counsel, Attention: FAA Part 16 
Airport Proceedings Docket, AGC-610, Federal Aviation Administration, 
800 Independence Ave., SW., Washington, DC, 20591. Documents to be 
filed with a hearing officer shall be filed at the address stated in 
the hearing order.
    (b) Date and method of filing. Filing of any document shall be by 
personal delivery or mail as defined in this part, or by facsimile 
(when confirmed by filing on the same date by one of the foregoing 
methods). Unless the date is shown to be inaccurate, documents to be 
filed with the FAA shall be deemed to be filed on the date of personal 
delivery, on the mailing date shown on the certificate of service, on 
the date shown on the postmark if there is no certificate of service, 
on the send date shown on the facsimile (provided filing has been 
confirmed through one of the foregoing methods), or on the mailing date 
shown by other evidence if there is no certificate of service and no 
postmark.
    (c) Number of copies. Unless otherwise specified, an executed 
original and three copies of each document shall be filed with the FAA 
Part 16 Airport Proceedings Docket. Copies need not be signed, but the 
name of the person signing the original shall be shown. If a hearing 
order has been issued in the case, one of the three copies shall be 
filed with the hearing officer. If filing by facsimile, the facsimile 
copy does not constitute one of the copies required under this section.
    (d) Form. Documents filed with the FAA shall be typewritten or 
legibly printed. In the case of docketed proceedings, the document 
shall include the docket number of the proceeding on the front page.
    (e) Signing of documents and other papers. The original of every 
document filed shall be signed by the person filing it or the person's 
duly authorized representative. The signature shall serve as a 
certification that the signer has read the document and, based on 
reasonable inquiry and to the best of the signer's knowledge, 
information, and belief, the document is--
    (1) Consistent with this part;
    (2) Warranted by existing law or that a good faith argument exists 
for extension, modification, or reversal of existing law; and
    (3) Not interposed for any improper purpose, such as to harass or 
to cause unnecessary delay or needless increase in the cost of the 
administrative process.
    (f) Designation of person to receive service. The initial document 
filed by any person shall state on the first page the name, post office 
address, telephone number, and facsimile number, if any, of the 
person(s) to be served with documents in the proceeding. If any of 
these items change during the proceeding, the person shall promptly 
file notice of the change with the FAA Part 16 Airport Proceedings 
Docket and the hearing officer and shall serve the notice on all 
parties.
    (g) Docket numbers. Each submission identified as a complaint under 
this part by the submitting person will be assigned a docket number.


Sec. 16.15  Service of documents on the parties and the agency.

    Except as otherwise provided in this part, documents shall be 
served as follows:
    (a) Who must be served. Copies of all documents filed with the FAA 
Part 16 Airport Proceedings Docket shall be served by the persons 
filing them on all parties to the proceeding. A certificate of service 
shall accompany all documents when they are tendered for filing and 
shall certify concurrent service on the FAA and all parties. 
Certificates of service shall be in substantially the following form:

    I hereby certify that I have this day served the foregoing [name 
of document] on the following persons at the following addresses and 
facsimile numbers (if also served by facsimile) by [specify method 
of service]:

[list persons, addresses, facsimile numbers]

    Dated this ______ day of ______, 19____.
[signature], for [party]

    (b) Method of service. Except as otherwise agreed by the parties 
and the hearing officer, the method of service is the same as set forth 
in Sec. 16.13(b) for filing documents.
    (c) Where service shall be made. Service shall be made to the 
persons identified in accordance with Sec. 16.13(f). If no such person 
has been designated, service shall be made on the party.
    (d) Presumption of service. There shall be a presumption of lawful 
service--
    (1) When acknowledgment of receipt is by a person who customarily 
or in the ordinary course of business receives mail at the address of 
the party or of the person designated under Sec. 16.13(f); or
    (2) When a properly addressed envelope, sent to the most current 
address submitted under Sec. 16.13(f), has been returned as 
undeliverable, unclaimed, or refused.
    (e) Date of service. The date of service shall be determined in the 
same manner as the filing date under Sec. 16.13(b).


Sec. 16.17  Computation of time.

    This section applies to any period of time prescribed or allowed by 
this part, by notice or order of the hearing officer, or by an 
applicable statute.
    (a) The date of an act, event, or default, after which a designated 
time period begins to run, is not included in a computation of time 
under this part.
    (b) The last day of a time period is included in a computation of 
time unless it is a Saturday, Sunday, or legal holiday for the FAA, in 
which case, the time period runs until the end of the next day that is 
not a Saturday, Sunday, or legal holiday.
    (c) Whenever a party has the right or is required to do some act 
within a prescribed period after service of a document upon the party, 
and the document is served on the party by mail, 3 days shall be added 
to the prescribed period.


Sec. 16.19  Motions.

    (a) General. An application for an order or ruling not otherwise 
specifically provided for in this part shall be by motion. Unless 
otherwise ordered by the agency, the filing of a motion will not stay 
the date that any action is permitted or required by this part.
    (b) Form and contents. Unless made during a hearing, motions shall 
be made in writing, shall state with particularity the relief sought 
and the grounds for the relief sought, and shall be accompanied by 
affidavits or other evidence relied upon. Motions introduced during 
hearings may be made orally on the record, unless the hearing officer 
directs otherwise.
    (c) Answers to motions. Except as otherwise provided in this part, 
or except when a motion is made during a hearing, any party may file an 
answer in support of or in opposition to a motion, accompanied by 
affidavits or other evidence relied upon, provided that the

[[Page 54007]]

answer to the motion is filed within 10 days after the motion has been 
served upon the person answering, or any other period set by the 
hearing officer. Where a motion is made during a hearing, the answer 
and the ruling thereon may be made at the hearing, or orally or in 
writing within the time set by the hearing officer.

Subpart C--Special Rules Applicable to Complaints


Sec. 16.21  Pre-complaint resolution.

    (a) Prior to filing a complaint under this part, a person directly 
and substantially affected by the alleged noncompliance shall initiate 
and engage in good faith efforts to resolve the disputed matter 
informally with those individuals or entities believed responsible for 
the noncompliance. These efforts at informal resolution may include, 
without limitation, at the parties' expense, mediation, arbitration, or 
the use of a dispute resolution board, or other form of third party 
assistance. The FAA Airports District Office, FAA Airports Field 
Office, or FAA Regional Airports Division responsible for 
administrating financial assistance to the respondent airport 
proprietor, will be available upon request to assist the parties with 
informal resolution.
    (b) A complaint under this part will not be considered unless the 
person or authorized representative filing the complaint certifies that 
substantial and reasonable good faith efforts to resolve the disputed 
matter informally prior to filing the complaint have been made and that 
there appears no reasonable prospect for timely resolution of the 
dispute. This certification shall include a brief description of the 
party's efforts to obtain informal resolution but shall not include 
information on monetary or other settlement offers made but not agreed 
upon in writing by all parties.


Sec. 16.23  Complaints, answers, replies, rebuttals, and other 
documents.

    (a) A person directly and substantially affected by any alleged 
noncompliance may file a complaint with the Administrator. A person 
doing business with an airport and paying fees or rentals to the 
airport shall be considered directly and substantially affected by 
alleged revenue diversion as defined in 49 U.S.C. 47107(b).
    (b) Complaints filed under this part shall--
    (1) State the name and address of each person who is the subject of 
the complaint and, with respect to each person, the specific provisions 
of each Act that the complainant believes were violated;
    (2) Be served, in accordance with Sec. 16.15, along with all 
documents then available in the exercise of reasonable diligence, 
offered in support of the complaint, upon all persons named in the 
complaint as persons responsible for the alleged action(s) or 
omission(s) upon which the complaint is based;
    (3) Provide a concise but complete statement of the facts relied 
upon to substantiate each allegation; and
    (4) Describe how the complainant was directly and substantially 
affected by the things done or omitted to be done by the respondents.
    (c) Unless the complaint is dismissed pursuant to Sec. 16.25 or 
Sec. 16.27, the FAA notifies the complainant and respondents in writing 
within 20 days after the date the FAA receives the complaint that the 
complaint has been docketed and that respondents are required to file 
an answer within 20 days of the date of service of the notification.
    (d) The respondent shall file an answer within 20 days of the date 
of service of the FAA notification.
    (e) The complainant may file a reply within 10 days of the date of 
service of the answer.
    (f) The respondent may file a rebuttal within 10 days of the date 
of service of the complainant's reply.
    (g) The answer, reply, and rebuttal shall, like the complaint, be 
accompanied by supporting documentation upon which the parties rely.
    (h) The answer shall deny or admit the allegations made in the 
complaint or state that the person filing the document is without 
sufficient knowledge or information to admit or deny an allegation, and 
shall assert any affirmative defense.
    (i) The answer, reply, and rebuttal shall each contain a concise 
but complete statement of the facts relied upon to substantiate the 
answers, admissions, denials, or averments made.
    (j) The respondent's answer may include a motion to dismiss the 
complaint, or any portion thereof, with a supporting memorandum of 
points and authorities. If a motion to dismiss is filed, the 
complainant may respond as part of its reply notwithstanding the 10-day 
time limit for answers to motions in Sec. 16.19(c).


Sec. 16.25  Dismissals.

    Within 20 days after the receipt of the complaint, the Director 
will dismiss a complaint, or any claim made in a complaint, with 
prejudice if:
    (a) It appears on its face to be outside the jurisdiction of the 
Administrator under the Acts listed in Sec. 16.1;
    (b) On its face it does not state a claim that warrants an 
investigation or further action by the FAA; or
    (c) The complainant lacks standing to file a complaint under 
Secs. 16.3 and 16.23. The Director's dismissal will include the reasons 
for the dismissal.


Sec. 16.27  Incomplete complaints.

    If a complaint is not dismissed pursuant to Sec. 16.25 of this 
part, but is deficient as to one or more of the requirements set forth 
in Sec. 16.21 or Sec. 16.23(b), the Director will dismiss the complaint 
within 20 days after receiving it. Dismissal will be without prejudice 
to the refiling of the complaint after amendment to correct the 
deficiency. The Director's dismissal will include the reasons for the 
dismissal.


Sec. 16.29  Investigations.

    (a) If, based on the pleadings, there appears to be a reasonable 
basis for further investigation, the FAA investigates the subject 
matter of the complaint.
    (b) The investigation may include one or more of the following, at 
the sole discretion of the FAA:
    (1) A review of the written submissions or pleadings of the 
parties, as supplemented by any informal investigation the FAA 
considers necessary and by additional information furnished by the 
parties at FAA request. In rendering its initial determination, the FAA 
may rely entirely on the complaint and the responsive pleadings 
provided under this subpart. Each party shall file documents that it 
considers sufficient to present all relevant facts and argument 
necessary for the FAA to determine whether the sponsor is in 
compliance.
    (2) Obtaining additional oral and documentary evidence by use of 
the agency's authority to compel production of such evidence under 
section 313 Aviation Act, 49 U.S.C. 40113 and 46104, and section 519 of 
the Airport and Airway Improvement Act, 49 U.S.C. 47122. The 
Administrator's statutory authority to issue compulsory process has 
been delegated to the Chief Counsel, the Deputy Chief Counsel, the 
Assistant Chief Counsel for Airports and Environmental Law, and each 
Assistant Chief Counsel for a region or center.
    (3) Conducting or requiring that a sponsor conduct an audit of 
airport financial records and transactions as provided in 49 U.S.C. 
47107 and 47121.


Sec. 16.31  Director's determinations after investigations.

    (a) After consideration of the pleadings and other information 
obtained by the FAA after investigation,

[[Page 54008]]

the Director will render an initial determination and provide it to 
each party by certified mail within 120 days of the date the last 
pleading specified in Sec. 16.23 was due.
    (b) The Director's determination will set forth a concise 
explanation of the factual and legal basis for the Director's 
determination on each claim made by the complainant.
    (c) A party adversely affected by the Director's determination may 
appeal the initial determination to the Associate Administrator as 
provided in Sec. 16.33.
    (d) If the Director's determination finds the respondent in 
noncompliance and proposes the issuance of a compliance order, the 
initial determination will include notice of opportunity for a hearing 
under subpart F of this part, if such an opportunity is provided by the 
FAA. The respondent may elect or waive a hearing as provided in subpart 
E of this part.


Sec. 16.33  Final decisions without hearing.

    (a) The Associate Administrator will issue a final decision on 
appeal from the Director's determination, without a hearing, where--
    (1) The complaint is dismissed after investigation;
    (2) A hearing is not required by statute and is not otherwise made 
available by the FAA; or
    (3) The FAA provides opportunity for a hearing to the respondent 
and the respondent waives the opportunity for a hearing as provided in 
subpart E of this part.
    (b) In the cases described in paragraph (a) of this section, a 
party adversely affected by the Director's determination may file an 
appeal with the Associate Administrator within 30 days after the date 
of service of the initial determination.
    (c) A reply to an appeal may be filed with the Associate 
Administrator within 20 days after the date of service of the appeal.
    (d) The Associate Administrator will issue a final decision and 
order within 60 days after the due date of the reply.
    (e) If no appeal is filed within the time period specified in 
paragraph (b) of this section, the Director's determination becomes the 
final decision and order of the FAA without further action. A 
Director's determination that becomes final because there is no 
administrative appeal is not judicially reviewable.

Subpart D--Special Rules Applicable to Proceedings Initiated by the 
FAA


Sec. 16.101  Basis for the initiation of agency action.

    The FAA may initiate its own investigation of any matter within the 
applicability of this part without having received a complaint. The 
investigation may include, without limitation, any of the actions 
described in Sec. 16.29(b).


Sec. 16.103  Notice of investigation.

    Following the initiation of an investigation under Sec. 16.101, the 
FAA sends a notice to the person(s) subject to investigation. The 
notice will set forth the areas of the agency's concern and the reasons 
therefor; request a response to the notice within 30 days of the date 
of service; and inform the respondent that the FAA will, in its 
discretion, invite good faith efforts to resolve the matter.


Sec. 16.105  Failure to resolve informally.

    If the matters addressed in the FAA notices are not resolved 
informally, the FAA may issue a Director's determination under 
Sec. 16.31.

Subpart E--Proposed Orders of Compliance


Sec. 16.109  Orders terminating eligibility for grants, cease and 
desist orders, and other compliance orders.

    This section applies to initial determinations issued under 
Sec. 16.31 that provide the opportunity for a hearing.
    (a) The agency will provide the opportunity for a hearing if, in 
the Director's determination, the agency proposes to issue an order 
terminating eligibility for grants pursuant to 49 U.S.C. 47106(e) and 
47111(d), an order suspending the payment of grant funds, an order 
withholding approval of any new application to impose a passenger 
facility charge pursuant to section 112 of the Federal Aviation 
Administration Act of 1994, 49 U.S.C. 47111(e), a cease and desist 
order, an order directing the refund of fees unlawfully collected, or 
any other compliance order issued by the Administrator to carry out the 
provisions of the Acts, and required to be issued after notice and 
opportunity for a hearing. In cases in which a hearing is not required 
by statute, the FAA may provide opportunity for a hearing at its 
discretion.
    (b) In a case in which the agency provides the opportunity for a 
hearing, the Director's determination issued under Sec. 16.31 will 
include a statement of the availability of a hearing under subpart F of 
this part.
    (c) Within 20 days after service of a Director's determination 
under Sec. 16.31 and paragraph (b) of this section, a person subject to 
the proposed compliance order may--
    (1) Request a hearing under subpart F of this part;
    (2) Waive hearing and appeal the Director's determination in 
writing to the Associate Administrator, as provided in Sec. 16.33;
    (3) File, jointly with a complainant, a motion to withdraw the 
complaint and to dismiss the proposed compliance action; or
    (4) Submit, jointly with the agency attorney, a proposed consent 
order under Sec. 16.243(e).
    (d) If the respondent fails to request a hearing or to file an 
appeal in writing within the time periods provided in paragraph (c) of 
this section, the Director's determination becomes final.

Subpart F--Hearings


Sec. 16.201  Notice and order of hearing.

    (a) If a respondent is provided the opportunity for hearing in an 
initial determination and does not waive hearing, the Deputy Chief 
Counsel within 10 days after the respondent elects a hearing will issue 
and serve on the respondent and complainant a hearing order. The 
hearing order will set forth:
    (1) The allegations in the complaint, or notice of investigation, 
and the chronology and results of the investigation preliminary to the 
hearing;
    (2) The relevant statutory, judicial, regulatory, and other 
authorities;
    (3) The issues to be decided;
    (4) Such rules of procedure as may be necessary to supplement the 
provisions of this part;
    (5) The name and address of the person designated as hearing 
officer, and the assignment of authority to the hearing officer to 
conduct the hearing in accordance with the procedures set forth in this 
part; and
    (6) The date by which the hearing officer is directed to issue an 
initial decision.
    (b) Where there are no genuine issues of material fact requiring 
oral examination of witnesses, the hearing order may contain a 
direction to the hearing officer to conduct a hearing by submission of 
briefs and oral argument without the presentation of testimony or other 
evidence.


Sec. 16.202  Powers of a hearing officer.

    In accordance with the rules of this subpart, a hearing officer 
may:
    (a) Give notice of, and hold, prehearing conferences and hearings;

[[Page 54009]]

    (b) Administer oaths and affirmations;
    (c) Issue subpoenas authorized by law and issue notices of 
deposition requested by the parties;
    (d) Limit the frequency and extent of discovery;
    (e) Rule on offers of proof;
    (f) Receive relevant and material evidence;
    (g) Regulate the course of the hearing in accordance with the rules 
of this part to avoid unnecessary and duplicative proceedings in the 
interest of prompt and fair resolution of the matters at issue;
    (h) Hold conferences to settle or to simplify the issues by consent 
of the parties;
    (i) Dispose of procedural motions and requests;
    (j) Examine witnesses; and
    (k) Make findings of fact and conclusions of law, and issue an 
initial decision.


Sec. 16.203  Appearances, parties, and rights of parties.

    (a) Appearances. Any party may appear and be heard in person.
    (1) Any party may be accompanied, represented, or advised by an 
attorney licensed by a State, the District of Columbia, or a territory 
of the United States to practice law or appear before the courts of 
that State or territory, or by another duly authorized representative.
    (2) An attorney, or other duly authorized representative, who 
represents a party shall file a notice of appearance in accordance with 
Sec. 16.13.
    (b) Parties and agency participation.
    (1) The parties to the hearing are the respondent (s) named in the 
hearing order, the complainant(s), and the agency.
    (2) Unless otherwise specified in the hearing order, the agency 
attorney will serve as prosecutor for the agency from the date of 
issuance of the Director's determination providing an opportunity for 
hearing.


Sec. 16.207  Intervention and other participation.

    (a) A person may submit a motion for leave to intervene as a party. 
Except for good cause shown, a motion for leave to intervene shall be 
submitted not later than 10 days after the notice of hearing and 
hearing order.
    (b) If the hearing officer finds that intervention will not unduly 
broaden the issues or delay the proceedings and, if the person has a 
property or financial interest that may not be addressed adequately by 
the parties, the hearing officer may grant a motion for leave to 
intervene. The hearing officer may determine the extent to which an 
intervenor may participate in the proceedings.
    (c) Other persons may petition the hearing officer for leave to 
participate in the hearing. Participation is limited to the filing of 
post-hearing briefs and reply to the hearing officer and the Associate 
Administrator. Such briefs shall be filed and served on all parties in 
the same manner as the parties' post hearing briefs are filed.
    (d) Participation under this section is at the discretion of the 
FAA, and no decision permitting participation shall be deemed to 
constitute an expression by the FAA that the participant has such a 
substantial interest in the proceeding as would entitle it to judicial 
review of such decision.


Sec. 16.209  Extension of time.

    (a) Extension by oral agreement. The parties may agree to extend 
for a reasonable period of time for filing a document under this part. 
If the parties agree, the hearing officer shall grant one extension of 
time to each party. The party seeking the extension of time shall 
submit a draft order to the hearing officer to be signed by the hearing 
officer and filed with the hearing docket. The hearing officer may 
grant additional oral requests for an extension of time where the 
parties agree to the extension.
    (b) Extension by motion. A party shall file a written motion for an 
extension of time with the hearing officer not later than 7 days before 
the document is due unless good cause for the late filing is shown. A 
party filing a written motion for an extension of time shall serve a 
copy of the motion on each party.
    (c) Failure to rule. If the hearing officer fails to rule on a 
written motion for an extension of time by the date the document was 
due, the motion for an extension of time is deemed denied.
    (d) Effect on time limits. In a hearing required by section 519(b) 
of the Airport and Airways Improvement Act, as amended in 1987, 49 
U.S.C. 47106(e) and 47111(d), the due date for the hearing officer's 
initial decision and for the final agency decision are extended by the 
length of the extension granted by the hearing officer only if the 
hearing officer grants an extension of time as a result of an agreement 
by the parties as specified in paragraph (a) of this section or, if the 
hearing officer grants an extension of time as a result of the 
sponsor's failure to adhere to the hearing schedule. In any other 
hearing, an extension of time granted by the hearing officer for any 
reason extends the due date for the hearing officer's initial decision 
and for the final agency decision by the length of time of the hearing 
officer's decision.


16.211  Prehearing conference.

    (a) Prehearing conference notice. The hearing officer schedules a 
prehearing conference and serves a prehearing conference notice on the 
parties promptly after being designated as a hearing officer.
    (1) The prehearing conference notice specifies the date, time, 
place, and manner (in person or by telephone) of the prehearing 
conference.
    (2) The prehearing conference notice may direct the parties to 
exchange proposed witness lists, requests for evidence and the 
production of documents in the possession of another party, responses 
to interrogatories, admissions, proposed procedural schedules, and 
proposed stipulations before the date of the prehearing conference.
    (b) The prehearing conference. The prehearing conference is 
conducted by telephone or in person, at the hearing officer's 
discretion. The prehearing conference addresses matters raised in the 
prehearing conference notice and such other matters as the hearing 
officer determines will assist in a prompt, full and fair hearing of 
the issues.
    (c) Prehearing conference report. At the close of the prehearing 
conference, the hearing officer rules on any requests for evidence and 
the production of documents in the possession of other parties, 
responses to interrogatories, and admissions; on any requests for 
depositions; on any proposed stipulations; and on any pending 
applications for subpoenas as permitted by Sec. 16.219. In addition, 
the hearing officer establishes the schedule, which shall provide for 
the issuance of an initial decision not later than 110 days after 
issuance of the Director's determination order unless otherwise 
provided in the hearing order.


Sec. 16.213  Discovery.

    (a) Discovery is limited to requests for admissions, requests for 
production of documents, interrogatories, and depositions as authorized 
by Sec. 16.215.
    (b) The hearing officer shall limit the frequency and extent of 
discovery permitted by this section if a party shows that--
    (1) The information requested is cumulative or repetitious;
    (2) The information requested may be obtained from another less 
burdensome and more convenient source;
    (3) The party requesting the information has had ample opportunity 
to obtain the information through other

[[Page 54010]]

discovery methods permitted under this section; or
    (4) The method or scope of discovery requested by the party is 
unduly burdensome or expensive.


Sec. 16.215  Depositions.

    (a) General. For good cause shown, the hearing officer may order 
that the testimony of a witness may be taken by deposition and that the 
witness produce documentary evidence in connection with such testimony. 
Generally, an order to take the deposition of a witness is entered only 
if:
    (1) The person whose deposition is to be taken would be unavailable 
at the hearing;
    (2) The deposition is deemed necessary to perpetuate the testimony 
of the witness; or
    (3) The taking of the deposition is necessary to prevent undue and 
excessive expense to a party and will not result in undue burden to 
other parties or in undue delay.
    (b) Application for deposition. Any party desiring to take the 
deposition of a witness shall make application therefor to the hearing 
officer in writing, with a copy of the application served on each 
party. The application shall include:
    (1) The name and residence of the witness;
    (2) The time and place for the taking of the proposed deposition;
    (3) The reasons why such deposition should be taken; and
    (4) A general description of the matters concerning which the 
witness will be asked to testify.
    (c) Order authorizing deposition. If good cause is shown, the 
hearing officer, in his or her discretion, issues an order authorizing 
the deposition and specifying the name of the witness to be deposed, 
the location and time of the deposition and the general scope and 
subject matter of the testimony to be taken.
    (d) Procedures for deposition.
    (1) Witnesses whose testimony is taken by deposition shall be sworn 
or shall affirm before any questions are put to them. Each question 
propounded shall be recorded and the answers of the witness transcribed 
verbatim.
    (2) Objections to questions or evidence shall be recorded in the 
transcript of the deposition. The interposing of an objection shall not 
relieve the witness of the obligation to answer questions, except where 
the answer would violate a privilege.
    (3) The written transcript shall be subscribed by the witness, 
unless the parties by stipulation waive the signing, or the witness is 
ill, cannot be found, or refuses to sign. The reporter shall note the 
reason for failure to sign.


Sec. 16.217  Witnesses.

    (a) Each party may designate as a witness any person who is able 
and willing to give testimony that is relevant and material to the 
issues in the hearing case, subject to the limitation set forth in 
paragraph (b) of this section.
    (b) The hearing officer may exclude testimony of witnesses that 
would be irrelevant, immaterial, or unduly repetitious.
    (c) Any witness may be accompanied by counsel. Counsel representing 
a nonparty witness has no right to examine the witness or otherwise 
participate in the development of testimony.


Sec. 16.219  Subpoenas.

    (a) Request for subpoena. A party may apply to the hearing officer, 
within the time specified for such applications in the prehearing 
conference report, for a subpoena to compel testimony at a hearing or 
to require the production of documents only from the following persons:
    (1) Another party;
    (2) An officer, employee, or agent of another party;
    (3) Any other person named in the complaint as participating in or 
benefiting from the actions of the respondent alleged to have violated 
any Act;
    (4) An officer, employee, or agent of any other person named in the 
complaint as participating in or benefiting from the actions of the 
respondent alleged to have violated any Act.
    (b) Issuance and service of subpoena.
    (1) The hearing officer issues the subpoena if the hearing officer 
determines that the evidence to be obtained by the subpoena is relevant 
and material to the resolution of the issues in the case.
    (2) Subpoenas shall be served by personal service, or upon an agent 
designated in writing for the purpose, or by certified mail, return 
receipt addressed to such person or agent. Whenever service is made by 
registered or certified mail, the date of mailing shall be considered 
as the time when service is made.
    (3) A subpoena issued under this part is effective throughout the 
United States or any territory or possession thereof.
    (c) Motions to quash or modify subpoena.
    (1) A party or any person upon whom a subpoena has been served may 
file a motion to quash or modify the subpoena with the hearing officer 
at or before the time specified in the subpoena for the filing of such 
motions. The applicant shall describe in detail the basis for the 
application to quash or modify the subpoena including, but not limited 
to, a statement that the testimony, document, or tangible evidence is 
not relevant to the proceeding, that the subpoena is not reasonably 
tailored to the scope of the proceeding, or that the subpoena is 
unreasonable and oppressive.
    (2) A motion to quash or modify the subpoena stays the effect of 
the subpoena pending a decision by the hearing officer on the motion.


Sec. 16.221  Witness fees.

    (a) The party on whose behalf a witness appears is responsible for 
paying any witness fees and mileage expenses.
    (b) Except for employees of the United States summoned to testify 
as to matters related to their public employment, witnesses summoned by 
subpoena shall be paid the same fees and mileage expenses as are paid 
to a witness in a court of the United States in comparable 
circumstances.


Sec. 16.223  Evidence.

    (a) General. A party may submit direct and rebuttal evidence in 
accordance with this section.
    (b) Requirement for written testimony and evidence. Except in the 
case of evidence obtained by subpoena, or in the case of a special 
ruling by the hearing officer to admit oral testimony, a party's direct 
and rebuttal evidence shall be submitted in written form in advance of 
the oral hearing pursuant to the schedule established in the hearing 
officer's prehearing conference report. Written direct and rebuttal 
fact testimony shall be certified by the witness as true and correct. 
Subject to the same exception (for evidence obtained by subpoena or 
subject to a special ruling by the hearing officer), oral examination 
of a party's own witness is limited to certification of the accuracy of 
written evidence, including correction and updating, if necessary, and 
reexamination following cross-examination by other parties.
    (c) Subpoenaed testimony. Testimony of witnesses appearing under 
subpoena may be obtained orally.
    (d) Cross-examination. A party may conduct cross-examination that 
may be required for disclosure of the facts, subject to control by the 
hearing officer for fairness, expedition and exclusion of extraneous 
matters.
    (e) Hearsay evidence. Hearsay evidence is admissible in proceedings 
governed by this part. The fact that

[[Page 54011]]

evidence is hearsay goes to the weight of evidence and does not affect 
its admissibility.
    (f) Admission of evidence. The hearing officer admits evidence 
introduced by a party in support of its case in accordance with this 
section, but may exclude irrelevant, immaterial, or unduly repetitious 
evidence.
    (g) Expert or opinion witnesses. An employee of the FAA or DOT may 
not be called as an expert or opinion witness for any party other than 
the agency except as provided in Department of Transportation 
regulations at 49 CFR part 9.


Sec. 16.225  Public disclosure of evidence.

    (a) Except as provided in this section, the hearing shall be open 
to the public.
    (b) The hearing officer may order that any information contained in 
the record be withheld from public disclosure. Any person may object to 
disclosure of information in the record by filing a written motion to 
withhold specific information with the hearing officer. The person 
shall state specific grounds for nondisclosure in the motion.
    (c) The hearing officer shall grant the motion to withhold 
information from public disclosure if the hearing officer determines 
that disclosure would be in violation of the Privacy Act, would reveal 
trade secrets or privileged or confidential commercial or financial 
information, or is otherwise prohibited by law.


Sec. 16.227  Standard of proof.

    The hearing officer shall issue an initial decision or shall rule 
in a party's favor only if the decision or ruling is supported by, and 
in accordance with, reliable, probative, and substantial evidence 
contained in the record and is in accordance with law.


Sec. 16.229  Burden of proof.

    (a) The burden of proof of noncompliance with an Act or any 
regulation, order, agreement or document of conveyance issued under the 
authority of an Act is on the agency.
    (b) Except as otherwise provided by statute or rule, the proponent 
of a motion, request, or order has the burden of proof.
    (c) A party who has asserted an affirmative defense has the burden 
of proving the affirmative defense.


Sec. 16.231  Offer of proof.

    A party whose evidence has been excluded by a ruling of the hearing 
officer may offer the evidence on the record when filing an appeal.


Sec. 16.233  Record.

    (a) Exclusive record. The transcript of all testimony in the 
hearing, all exhibits received into evidence, all motions, applications 
requests and rulings, and all documents included in the hearing record 
shall constitute the exclusive record for decision in the proceedings 
and the basis for the issuance of any orders.
    (b) Examination and copy of record. Any interested person may 
examine the record at the Part 16 Airport Proceedings Docket, AGC-600, 
Federal Aviation Administration, 800 Independence Avenue, SW., 
Washington, DC 20591. Any person may have a copy of the record after 
payment of reasonable costs for search and reproduction of the record.


Sec. 16.235  Argument before the hearing officer.

    (a) Argument during the hearing. During the hearing, the hearing 
officer shall give the parties reasonable opportunity to present oral 
argument on the record supporting or opposing motions, objections, and 
rulings if the parties request an opportunity for argument. The hearing 
officer may direct written argument during the hearing if the hearing 
officer finds that submission of written arguments would not delay the 
hearing.
    (b) Posthearing briefs. The hearing officer may request or permit 
the parties to submit posthearing briefs. The hearing officer may 
provide for the filing of simultaneous reply briefs as well, if such 
filing will not unduly delay the issuance of the hearing officer's 
initial decision. Posthearing briefs shall include proposed findings of 
fact and conclusions of law; exceptions to rulings of the hearing 
officer; references to the record in support of the findings of fact; 
and supporting arguments for the proposed findings, proposed 
conclusions, and exceptions.


Sec. 16.237  Waiver of procedures.

    (a) The hearing officer shall waive such procedural steps as all 
parties to the hearing agree to waive before issuance of an initial 
decision.
    (b) Consent to a waiver of any procedural step bars the raising of 
this issue on appeal.
    (c) The parties may not by consent waive the obligation of the 
hearing officer to enter an initial decision on the record.

Subpart G--Initial Decisions, Orders and Appeals


Sec. 16.241  Initial decisions, order, and appeals.

    (a) The hearing officer shall issue an initial decision based on 
the record developed during the proceeding and shall send the initial 
decision to the parties not later than 110 days after the Director's 
determination unless otherwise provided in the hearing order.
    (b) Each party adversely affected by the hearing officer's initial 
decision may file an appeal with the Associate Administrator within 15 
days of the date the initial decision is issued. Each party may file a 
reply to an appeal within 10 days after it is served on the party. 
Filing and service of appeals and replies shall be by personal 
delivery.
    (c) If an appeal is filed, the Associate Administrator reviews the 
entire record and issues a final agency decision and order within 30 
days of the due date of the reply. If no appeal is filed, the Associate 
Administrator may take review of the case on his or her own motion. If 
the Associate Administrator finds that the respondent is not in 
compliance with any Act or any regulation, agreement, or document of 
conveyance issued or made under such Act, the final agency order 
includes a statement of corrective action, if appropriate, and 
identifies sanctions for continued noncompliance.
    (d) If no appeal is filed, and the Associate Administrator does not 
take review of the initial decision on the Associate Administrator's 
own motion, the initial decision shall take effect as the final agency 
decision and order on the sixteenth day after the actual date the 
initial decision is issued.
    (e) The failure to file an appeal is deemed a waiver of any rights 
to seek judicial review of an initial decision that becomes a final 
agency decision by operation of paragraph (d) of this section.
    (f) If the Associate Administrator takes review on the Associate 
Administrator's own motion, the Associate Administrator issues a notice 
of review by the sixteenth day after the actual date the initial 
decision is issued.
    (1) The notice sets forth the specific findings of fact and 
conclusions of law in the initial decision that are subject to review 
by the Associate Administrator.
    (2) Parties may file one brief on review to the Associate 
Administrator or rely on their posthearing briefs to the hearing 
officer. Briefs on review shall be filed not later than 10 days after 
service of the notice of review. Filing and service of briefs on review 
shall be by personal delivery.

[[Page 54012]]

    (3) The Associate Administrator issues a final agency decision and 
order within 30 days of the due date of the briefs on review. If the 
Associate Administrator finds that the respondent is not in compliance 
with any Act or any regulation, agreement or document of conveyance 
issued under such Act, the final agency order includes a statement of 
corrective action, if appropriate, and identifies sanctions for 
continued noncompliance.


Sec. 16.243  Consent orders.

    (a) The agency attorney and the respondents may agree at any time 
before the issuance of a final decision and order to dispose of the 
case by issuance of a consent order. Good faith efforts to resolve a 
complaint through issuance of a consent order may continue throughout 
the administrative process. Except as provided in Sec. 16.209, such 
efforts may not serve as the basis for extensions of the times set 
forth in this part.
    (b) A proposal for a consent order, specified in paragraph (a) of 
this section, shall include:
    (1) A proposed consent order;
    (2) An admission of all jurisdictional facts;
    (3) An express waiver of the right to further procedural steps and 
of all rights of judicial review; and
    (4) The hearing order, if issued, and an acknowledgment that the 
hearing order may be used to construe the terms of the consent order.
    (c) If the issuance of a consent order has been agreed upon by all 
parties to the hearing, the proposed consent order shall be filed with 
the hearing officer, along with a draft order adopting the consent 
decree and dismissing the case, for the hearing officer's adoption.
    (d) The deadline for the hearing officer's initial decision and the 
final agency decision is extended by the amount of days elapsed between 
the filing of the proposed consent order with the hearing officer and 
the issuance of the hearing officer's order continuing the hearing.
    (e) If the agency attorney and sponsor agree to dispose of a case 
by issuance of a consent order before the FAA issues a hearing order, 
the proposal for a consent order is submitted jointly to the official 
authorized to issue a hearing order, together with a request to adopt 
the consent order and dismiss the case. The official authorized to 
issue the hearing order issues the consent order as an order of the FAA 
and terminates the proceeding.

Subpart H--Judicial Review


Sec. 16.247  Judicial review of a final decision and order.

    (a) A person may seek judicial review, in a United States Court of 
Appeals, of a final decision and order of the Associate Administrator 
as provided in 49 U.S.C. 46110 or section 519(b)(4) of the Airport and 
Airway Improvement Act of 1982, as amended, (AAIA), 49 U.S.C. 47106(d) 
and 47111(d). A party seeking judicial review of a final decision and 
order shall file a petition for review with the Court not later than 60 
days after a final decision and order under the AAIA has been served on 
the party or within 60 days after the entry of an order under 49 U.S.C. 
40101 et seq.
    (b) The following do not constitute final decisions and orders 
subject to judicial review:
    (1) An FAA decision to dismiss a complaint without prejudice, as 
set forth in Sec. 16.27;
    (2) A Director's determination;
    (3) An initial decision issued by a hearing officer at the 
conclusion of a hearing;
    (4) A Director's determination or an initial decision of a hearing 
officer that becomes the final decision of the Associate Administrator 
because it was not appealed within the applicable time periods provided 
under Secs. 16.33(b) and 16.241(b).

Subpart I--Ex Parte Communications


Sec. 16.301  Definitions.

    As used in this subpart:
    Decisional employee means the Administrator, Deputy Administrator, 
Associate Administrator, Director, hearing officer, or other FAA 
employee who is or who may reasonably be expected to be involved in the 
decisional process of the proceeding.
    Ex parte communication means an oral or written communication not 
on the public record with respect to which reasonable prior notice to 
all parties is not given, but it shall not include requests for status 
reports on any matter or proceeding covered by this part, or 
communications between FAA employees who participate as parties to a 
hearing pursuant to 16.203(b) of this part and other parties to a 
hearing.


Sec. 16.303  Prohibited ex parte communications.

    (a) The prohibitions of this section shall apply from the time a 
proceeding is noticed for hearing unless the person responsible for the 
communication has knowledge that it will be noticed, in which case the 
prohibitions shall apply at the time of the acquisition of such 
knowledge.
    (b) Except to the extent required for the disposition of ex parte 
matters as authorized by law:
    (1) No interested person outside the FAA and no FAA employee 
participating as a party shall make or knowingly cause to be made to 
any decisional employee an ex parte communication relevant to the 
merits of the proceeding;
    (2) No FAA employee shall make or knowingly cause to be made to any 
interested person outside the FAA an ex parte communication relevant to 
the merits of the proceeding; or
    (3) Ex parte communications regarding solely matters of agency 
procedure or practice are not prohibited by this section.


Sec. 16.305  Procedures for handling ex parte communications.

    A decisional employee who receives or who makes or knowingly causes 
to be made a communication prohibited by Sec. 16.303 shall place in the 
public record of the proceeding:
    (a) All such written communications;
    (b) Memoranda stating the substance of all such oral 
communications; and
    (c) All written responses, and memoranda stating the substance of 
all oral responses, to the materials described in paragraphs (a) and 
(b) of this section.


Sec. 16.307  Requirement to show cause and imposition of sanction.

    (a) Upon receipt of a communication knowingly made or knowingly 
caused to be made by a party in violation of Sec. 16.303, the Associate 
Administrator or his designee or the hearing officer may, to the extent 
consistent with the interests of justice and the policy of the 
underlying statutes, require the party to show cause why his or her 
claim or interest in the proceeding should not be dismissed, denied, 
disregarded, or otherwise adversely affected on account of such 
violation.
    (b) The Associate Administrator may, to the extent consistent with 
the interests of justice and the policy of the underlying statutes 
administered by the FAA, consider a violation of this subpart 
sufficient grounds for a decision adverse to a party who has knowingly 
committed such violation or knowingly caused such violation to occur.

    Issued in Washington, DC, on October 8, 1996.
David R. Hinson,
Administrator.
[FR Doc. 96-26180 Filed 10-10-96; 8:45 am]
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