[Federal Register Volume 65, Number 193 (Wednesday, October 4, 2000)]
[Rules and Regulations]
[Pages 59270-59273]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-25374]



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Part III





Nuclear Regulatory Commission





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10 CFR Parts 1, 2 and 13



Adjustment of Civil Penalties for Inflation; Miscellaneous 
Administrative Changes and Revision of the NRC Enforcement Policy; 
Final Rule and Notice

  Federal Register / Vol. 65, No. 193 / Wednesday, October 4, 2000 / 
Rules and Regulations  

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NUCLEAR REGULATORY COMMISSION

10 CFR Parts 1, 2 and 13

RIN 3150-AG59


Adjustment of Civil Penalties for Inflation; Miscellaneous 
Administrative Changes

AGENCY: Nuclear Regulatory Commission.

ACTION: Final rule.

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SUMMARY: The Nuclear Regulatory Commission (NRC) is amending its 
regulations to adjust the maximum Civil Monetary Penalties (CMPs) it 
can assess under statutes within the jurisdiction of the NRC. These 
changes are mandated by Congress in the Federal Civil Penalties 
Inflation Adjustment Act of 1990, as amended by the Debt Collection 
Improvement Act of 1996.
    The NRC's Rules of Practice are amended by adding a provision that 
adjusts the maximum CMP for a violation of the Atomic Energy Act (AEA) 
or any regulations or order issued thereunder from $110,000 to $120,000 
per violation per day. The provisions concerning program fraud civil 
penalties are amended by adjusting the maximum civil penalties under 
the Program Fraud Civil Remedies Act from $5,500 to $6,000 for each 
false claim or statement. This final rule also amends the designation 
of the term ``Reviewing official'' for the purposes of the Program 
Fraud Civil Remedies Act to reflect a reorganization in the Office of 
the General Counsel (OGC) as well as making a minor modification to NRC 
regulations to reflect OGC's role in providing legal advice to NRC 
staff upon request on agency procurement matters.

DATES: The rule shall be effective on November 3, 2000.

FOR FURTHER INFORMATION CONTACT: Norman St. Amour, Office of the 
General Counsel, U.S. Nuclear Regulatory Commission, Washington, D.C. 
20555-0001, telephone (301) 415-1589; e-mail [email protected].

I. Background

A. Civil Penalty Adjustment

    The Federal Civil Penalties Inflation Adjustment Act of 1990, as 
amended, requires that the head of each agency adjust by regulation the 
CMPs within the jurisdiction of the agency for inflation at least once 
every four years. The NRC's last adjustment to the CMPs within its 
jurisdiction occurred on November 12, 1996. Thus, this inflation 
adjustment must be implemented by November 12, 2000.
    The inflation adjustment is to be determined by increasing the 
maximum CMPs or the range of the minimum and maximum CMPs, as 
applicable, by the percentage that the Consumer Price Index (CPI) for 
the month of June of the calendar year preceding the adjustment exceeds 
the CPI for the month of June of the last calendar year in which the 
amount of such penalty was last set. For the purposes of this 
adjustment, applying this formula results in a six percent increase to 
the CMPs. In the case of penalties greater than $1,000, but less than 
or equal to $10,000, inflation adjustment increases are to be rounded 
to the nearest multiple of $1,000. Increases are to be rounded to the 
nearest multiple of $10,000 in the case of penalties greater than 
$100,000 but less than or equal to $200,000.

B. Miscellaneous Administrative Changes

    Under the Program Fraud Civil Remedies Act, the NRC is required to 
designate a ``reviewing official.'' The reviewing official has several 
duties under the Act, including making the determination as to whether 
there is adequate evidence against an individual to warrant 
commencement of an administrative proceeding.
    Under the Commission's original rules implementing the Act, the 
Deputy General Counsel for Licensing and Regulation, or his or her 
designee, is identified as the reviewing official for the purposes of 
the Program Fraud Civil Remedies Act. 10 CFR 13.2 (2000). Because the 
position of Deputy General Counsel for Licensing and Regulation does 
not exist as such in the Office of the General Counsel, the Commission 
is designating the General Counsel as the ``reviewing official.'' The 
General Counsel may delegate this authority.
    This final rule would also make a minor modification to the 
language of 10 CFR 1.23(e). This modification reflects the Office of 
General Counsel's long-standing practice of providing legal advice and 
opinions to NRC staff on procurement matters in response to specific 
requests from contracting offices and other interested agency offices, 
rather than preparing or concurring in all NRC contracts and 
interagency agreements to acquire supplies and services.

II. Discussion

    Section 234 of the AEA has limited civil penalties for violations 
of the Atomic Energy Act to $100,000 per day per violation. In 1996, 
pursuant to the Debt Collection Improvement Act (DCIA), the NRC 
adjusted this figure to $110,000. The DCIA also amended the Federal 
Civil Penalties Inflation Adjustment Act of 1990 to require that the 
head of each agency adjust the CMPs within the jurisdiction of the 
agency for inflation at least once every four years. Therefore, the NRC 
is required to adjust the CMPs within its jurisdiction this year. After 
this mandatory adjustment for inflation, the new CMP penalty amount for 
a violation of the AEA will be $120,000 per day per violation (rounding 
the amount of the inflation adjustment increase to the nearest multiple 
of $10,000). Thus, by regulation, the NRC has amended 10 CFR 2.205 to 
reflect a new maximum CMP under the AEA in the amount of $120,000 per 
day per violation. This new maximum CMP applies only to violations that 
occur after the effective date of this regulation.
    Monetary penalties under the Program Fraud Civil Remedies Act, 31 
U.S.C. 3801, 3802, and the NRC's implementing regulations, 10 CFR 13.3 
(a)(1) and (b)(1), are currently limited to $5,500. As adjusted for 
inflation, the penalty amount will be $6,000. Thus, NRC has amended 
13.3 (a)(1) and (b)(1) by increasing the maximum CMP for each false 
statement or claim under the Program Fraud Civil Remedies Act from 
$5,500 to $6,000. Again, this new maximum CMP applies only to 
violations which occur after the effective date of this regulation.
    The Commission has no discretion to set alternative levels of 
adjusted civil penalties since the amount of inflation adjustment must 
be calculated in accordance with a formula established by statute. 
Conforming changes to the NRC Enforcement Policy (NUREG-1600) published 
in the Federal Register on May 1, 2000 will be made and published in a 
notice accompanying this rule.
    The Program Fraud Civil Remedies Act ``reviewing official'' in 10 
CFR 13.2 currently means the Deputy General Counsel for Licensing and 
Regulation of the NRC or his or her designee. This position does not 
exist in the current OGC organization. Accordingly, the Commission is 
amending the designation of ``reviewing official'' to mean the General 
Counsel of the NRC or his or her designee.
    This final rule would also make a minor modification to the 
language of 10 CFR 1.23(e). The existing language implies that OGC 
provides legal advice and opinions on all agency procurement matters. 
This modification reflects OGC's long-standing practice of providing 
legal advice and opinions to NRC staff on procurement matters only in 
response to specific requests from contracting offices and other 
interested

[[Page 59271]]

offices, rather than preparing or concurring in all NRC contracts and 
interagency agreements to acquire supplies and services.

III. Procedural Background

    This final rule has been issued without prior public notice or 
opportunity for public comment. The Administrative Procedure Act (5 
U.S.C. 553(b)(B)) does not require that an agency use the public notice 
and comment process ``when the agency for good cause finds (and 
incorporates the finding and a brief statement of reasons therefor in 
the rules issued) that notice and public procedure thereon are 
impracticable, unnecessary, or contrary to the public interest.'' In 
this instance, the NRC finds, for good cause, that solicitation of 
public comment on this final rule is unnecessary and impractical. 
Congress has required that the agency adjust the CMPs within the 
jurisdiction of the agency for inflation at least once every four 
years, and provided no discretion to the agency regarding the substance 
of the amendments. All that is required of the NRC for determination of 
the inflation adjustment are ministerial computations. The NRC also 
finds that amending the designation of reviewing official under the 
Program Fraud Civil Remedies Act and the minor modification to reflect 
OGC's actual long-standing practice of providing legal advice to NRC 
staff on procurement matters upon request are routine matters of agency 
organization, procedure, or practice exempt from the requirement for 
public notice and comment.

IV. Environmental Impact: Categorical Exclusion

    The NRC has determined that this final rule is the type of action 
described as a categorical exclusion in 10 CFR 51.22(c)(1) and 
51.22(c)(2). Therefore, neither an environmental impact statement nor 
an environmental assessment has been prepared for this regulation. This 
action involves no policy determinations. It merely adjusts monetary 
civil penalties for inflation as required by statute and amends the 
definition of ``reviewing official'' for Program Fraud Civil Remedies 
Act matters to reflect a reorganization in the Office of the General 
Counsel and incorporates a minor modification to the language of 10 CFR 
1.23(e) to reflect actual long-standing OGC practice in providing legal 
advice to NRC staff, upon request, on agency procurement matters.

V. Paperwork Reduction Act Statement

    This final rule does not contain new or amended information 
collection requirements subject to the Paperwork Reduction Act of 1995 
(44 U.S.C. 3501 et seq.).

VI. Regulatory Analysis

    This final rule adjusts for inflation the maximum civil penalties 
under the Atomic Energy Act of 1954, as amended, and under the Program 
Fraud Civil Remedies Act of 1986. The adjustments and the formula for 
determining the amount of the adjustment are mandated by Congress in 
the Federal Civil Penalties Inflation Adjustment Act of 1990 (Pub. L. 
No. 101-410, 104 Stat. 890), as amended by the Debt Collection 
Improvement Act of 1996, as amended (Pub. L. No. 104-134, 110 Stat. 
1321-358, 373, codified at 28 U.S.C. 2461 note). Congress passed that 
legislation on the basis of its findings that the power to impose 
monetary civil penalties is important to deterring violations of 
Federal law and furthering the policy goals of Federal laws and 
regulations. Congress has also found that inflation has diminished the 
impact of these penalties and their effect. The principal purposes of 
this legislation are to provide for adjustment of civil monetary 
penalties for inflation, maintain the deterrent effect of civil 
monetary penalties, and promote compliance with the law. Thus, these 
are anticipated impacts of implementation of the mandatory provisions 
of the legislation. Direct monetary impacts fall only upon licensees or 
other persons subjected to NRC enforcement or those licensees or 
persons subjected to liability pursuant to the provisions of the 
Program Fraud Civil Remedies Act of 1986 (31 U.S.C. 3801-3812) and the 
NRC's implementing regulations (10 CFR part 13). This final rule also 
makes an adjustment to the designation of ``reviewing official'' for 
Program Fraud Civil Remedies Act matters to reflect an Office of the 
General Counsel reorganization and incorporates a minor modification to 
the language of 10 CFR 1.23(e) to reflect OGC's long-standing practice 
of providing legal advice and opinions to NRC staff on procurement 
matters in response to specific requests from contracting offices and 
other interested agency offices, rather than preparing or concurring in 
all NRC contracts and interagency agreements to acquire supplies and 
services.

VII. Regulatory Flexibility Certification

    In accordance with the Regulatory Flexibility Act of 1980, 5 U.S.C. 
605(b), the Commission hereby certifies that this rule will not have a 
significant economic impact on a substantial number of small entities. 
This rulemaking adjusts, for inflation, the amount charged for civil 
penalties, as required by the Debt Collection Improvement Act. The law 
mandates that adjustments for inflation be made at least every four 
years and sets forth a formula for determining the amount of the 
adjustment. The Nuclear Regulatory Commission has no discretion in 
implementing these requirements. To the extent that small entities are 
impacted by this rule, these are anticipated impacts resulting from the 
mandatory provisions of the legislation authorized by Congress.

VIII. Small Business Regulatory Enforcement Fairness Act

    In accordance with the Small Business Regulatory Enforcement 
Fairness Act of 1996, the NRC has determined that this action is not a 
major rule and has verified this determination with the Office of 
Information and Regulatory Affairs of OMB.

IX. National Technology Transfer and Advancement Act

    The National Technology Transfer and Advancement Act of 1995, Pub. 
L. 104-113, requires that Federal agencies use technical standards 
developed by or adopted by voluntary consensus standards bodies unless 
the use of such a standard is inconsistent with applicable law or 
otherwise impractical. There are no consensus standards that apply to 
the inflation adjustment requirements in this final rule. Thus, the 
provisions of the Act do not apply to this rulemaking.

X. Backfit Analysis

    The NRC has determined that these amendments do not involve any 
provisions which would impose backfits as defined in 10 CFR Chapter 1; 
therefore, a backfit analysis need not be prepared.

List of Subjects

10 CFR Part 1

    Organization and functions (Government Agencies).

10 CFR Part 2

    Administrative practice and procedure, Antitrust, Byproduct 
material, Classified information, Environmental protection, Nuclear 
materials, Nuclear power plants and reactors, Penalties, Sex 
discrimination, Source material, Special nuclear material, Waste 
treatment and disposal.

[[Page 59272]]

10 CFR Part 13

    Claims, Fraud, Organization and function (government agencies), 
Penalties.

    For the reasons set out above and under the authority of the Atomic 
Energy Act of 1954, as amended, the Energy Reorganization Act of 1974, 
as amended, the Federal Civil Penalties Inflation Adjustment Act of 
1990, as amended, and 5 U.S.C. 552 and 553, the NRC is adopting the 
following amendments to 10 CFR parts 1, 2 and 13.

PART 1--STATEMENT OF ORGANIZATION AND GENERAL INFORMATION

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

    Authority: Secs. 23, 161, 68 Stat. 925, 948, as amended (42 
U.S.C. 2033, 2201); sec. 29, Pub. L. 85-256, 71 Stat. 579, Pub. L. 
95-209, 91 stat. 1483 (42 U.S.C. 2039); sec. 191, Pub. L. 87-615, 76 
Stat. 409 (42 U.S.C. 2241); secs. 201, 203, 204, 205, 209, 88 Stat. 
1242, 1244, 1245, 1246, 1248, as amended (42 U.S.C. 5841, 5843, 
5844, 5845, 5849); 5 U.S.C. 552, 553; Reorganization Plan No. 1 of 
1980, 45 FR 40561, June 16, 1980.


    2. In Sec. 1.23, paragraph (e) is revised to read as follows:


Sec. 1.23  Office of the General Counsel.

* * * * *
    (e) As requested, provides the agency with legal advice and 
opinions on acquisition matters, including agency procurement 
contracts; placement of work at Department of Energy national 
laboratories; interagency agreements to acquire supplies and services; 
and grants and cooperative agreements. Prepares or concurs in all other 
interagency agreements, delegations of authority, regulations; orders; 
licenses; and other legal documents and prepares legal interpretations 
thereof;
* * * * *

PART 2--RULES OF PRACTICE FOR DOMESTIC LICENSING PROCEEDINGS AND 
ISSUANCES OF ORDERS

    3. The authority citation for part 2 continues to read as follows:

    Authority: Secs. 161, 181, 68 Stat. 948, 953, as amended (42 
U.S.C. 2201, 2231); sec. 191, as amended, Pub. L. 87-615, 76 Stat. 
409 (42 U.S.C. 2241); sec. 201, 88 Stat. 1242, as amended (42 U.S.C. 
5841); 5 U.S.C. 552.
    Section 2.101 also issued under secs. 53, 62, 63, 81, 103, 104, 
105, 68 Stat. 930, 932, 933, 935, 936, 937, 938, as amended (42 
U.S.C. 2073, 2092, 2093, 2111, 2133, 2134, 2135); sec. 114(f), Pub. 
L. 97-425, 96 Stat. 2213, as amended (42 U.S.C. 10134(f)); sec. 102, 
Pub. L. 91-190, 83 Stat. 853, as amended (42 U.S.C. 4332); sec. 301, 
88 Stat. 1248 (42 U.S.C. 5871). Sections 2.102, 2.103, 2.104, 2.105, 
2.721 also issued under secs. 102, 103, 104, 105, 183, 189, 68 Stat. 
936, 937, 938, 954, 955, as amended (42 U.S.C. 2132, 2133, 2134, 
2135, 2233, 2239). Section 2.105 also issued under Pub. L. 97-415, 
96 Stat. 2073 (42 U.S.C. 2239). Sections 2.200-2.206 also issued 
under secs. 161 b, i, o, 182, 186, 234, 68 Stat. 948-951, 955, 83 
Stat. 444, as amended (42 U.S.C. 2201 (b), (i), (o), 2236, 2282); 
sec. 206, 88 Stat. 1246 (42 U.S.C. 5846). Sections 2.205(j) also 
issued under Pub. L. 101-410, 104 Stat. 890, as amended by section 
31001(s), Pub. L. 104-134, 110 Stat. 1321-373 (28 U.S.C. 2461 note). 
Sections 2.600-2.606 also issued under sec. 102, Pub. L. 91-190, 83 
Stat. 853, as amended (42 U.S.C. 4332). Sections 2.700a, 2.719 also 
issued under 5 U.S.C. 554. Sections 2.754, 2.760, 2.770, 2.780 also 
issued under 5 U.S.C. 557. Section 2.764 also issued under secs. 
135, 141, Pub. L. 97-425, 96 Stat. 2232, 2241 (42 U.S.C. 10155, 
10161). Section 2.790 also issued under sec. 103, 68 Stat. 936, as 
amended (42 U.S.C. 2133) and 5 U.S.C. 552. Sections 2.800 and 2.808 
also issued under 5. U.S.C. 553. Section 2.809 also issued under 5. 
U.S.C. 553 and sec. 29, Pub. L. 85-256, 71 Stat. 579, as amended (42 
U.S.C. 2039). Subpart K also issued under sec. 189, 68 Stat. 955 (42 
U.S.C. 2239); sec. 134, Pub. L. 97-425, 96 Stat. 2230 (42 U.S.C. 
10154). Subpart L also issued under sec. 189, 68 Stat. 955 (42 
U.S.C. 2239). Appendix A also issued under sec. 6, Pub. L. 91-560, 
84 Stat. 1473 (42 U.S.C. 2135).


    4. In Sec. 2.205 paragraph (j) is revised to read as follows:


Sec. 2.205  Civil Penalties.

* * * * *
    (j) Amount. A civil monetary penalty imposed under Section 234 of 
the Atomic Energy Act of 1954, as amended, or any other statute within 
the jurisdiction of the Commission that provides for the imposition of 
a civil penalty in an amount equal to the amount set forth in Section 
234, may not exceed $120,000 for each violation. If any violation is a 
continuing one, each day of such violation shall constitute a separate 
violation for the purpose of computing the applicable civil penalty.

PART 13--PROGRAM FRAUD CIVIL REMEDIES

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

    Authority: Public Law 99-509, sec 6101-6104, 100 Stat. 1874 (31 
U.S.C. 3801-3812). Sections 13.13(a) and (b) also issued under Pub. 
L. 101-410, 104 Stat. 890, as amended by section 31001(s), Pub. L. 
104-134, 110 Stat. 1321-373 (28 U.S.C. 2461 note).


    6. In Sec. 13.2 the definition of ``Reviewing official'' is revised 
to read as follows:


Sec. 13.2  Definitions.

* * * * *
    Reviewing official means the General Counsel of the Nuclear 
Regulatory Commission or his or her designee who is--
    (a) Not subject to supervision by, or required to report to, the 
investigating official;
    (b) Not employed in the organizational unit of the authority in 
which the investigating official is employed; and
    (c) Serving in a position for which the rate of basic pay is not 
less than the minimum rate of basic pay for grade GS-16 under the 
General Schedule.
* * * * *

    7. In Sec. 13.3, paragraphs (a)(1) and (b)(1) are revised to read 
as follows:

[[Page 59273]]

Sec. 13.3  Basis for civil penalties and assessments.

    (a) Claims. (1) Any person who makes a claim that the person knows 
or has reason to know--
    (i) Is false, fictitious, or fraudulent;
    (ii) Includes or is supported by any written statement which 
asserts a material fact which is false, fictitious, or fraudulent;
    (iii) Includes or is supported by any written statement that--
    (A) Omits a material fact;
    (B) Is false, fictitious, or fraudulent as a result of such 
omission; and (C) Is a statement in which the person making such 
statement has a duty to include such material fact; or
    (iv) Is for payment for the provision of property or services which 
the person has not provided as claimed, shall be subject, in addition 
to any other remedy that may be prescribed by law, to a civil penalty 
of not more than $6,000 for each such claim.
* * * * *
    (b) Statements. (1) Any person who makes a written statement that--
    (i) The person knows or has reason to know--
    (A) Asserts a material fact which is false, fictitious, or 
fraudulent; or
    (B) Is false, fictitious, or fraudulent because it omits a material 
fact that the person making the statement has a duty to include in such 
statement; and
    (ii) Contains or is accompanied by an express certification or 
affirmation of the truthfulness and accuracy of the contents of the 
statement, shall be subject, in addition to any other remedy that may 
be prescribed by law, to a civil penalty of not more than $6,000 for 
each such statement.
* * * * *

    Dated at Rockville, Maryland, this 27th day of September, 2000.

    For the Nuclear Regulatory Commission.
Annette L. Vietti-Cook,
Secretary of the Commission.
[FR Doc. 00-25374 Filed 10-3-00; 8:45 am]
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