[Federal Register Volume 66, Number 97 (Friday, May 18, 2001)]
[Proposed Rules]
[Pages 27621-27623]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 01-12551]


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DEPARTMENT OF TRANSPORTATION

National Highway Traffic Safety Administration

49 CFR Part 578

[Docket No. NHTSA 2001-9404; Notice 1]
RIN 2127-AI42


Civil Penalties

AGENCY: National Highway Traffic Safety Administration (NHTSA), DOT.

ACTION: Notice of proposed rulemaking (NPRM).

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SUMMARY: This document proposed to adjust certain civil penalties 
authorized for violations of odometer tampering and theft prevention 
statutes administered by the National Highway Traffic Safety 
Administration (NHTSA). The Federal Civil Monetary Penalty Inflation 
Adjustment Act of 1990, as amended by the Debt Collection Improvement 
Act of 1996, requires us to take this action at least every four years. 
The penalties that would be increased were last adjusted in March 1997.

DATES: Comments on the proposal are due June 18, 2001.
    Proposed effective date: 30 days after date of publication of the 
final rule in the Federal Register.

ADDRESSES: All comments on this document should refer to the docket and 
notice number set forth above and be submitted to Dockets Management, 
Room PL-401, 400 Seventh St., SW., Washington, DC 20590. The docket 
room hours are from 9:30 a.m. to 5:00 p.m., Monday through Friday.

FOR FURTHER INFORMATION CONTACT: Taylor Vinson, Office of Chief 
Counsel, NHTSA, telephone (202) 366-5263, facsimile (202) 366-3820, 
electronic mail ``[email protected]'', 400 Seventh Street, SW, 
Washington, DC 20590.

SUPPLEMENTARY INFORMATION:

Background

    In order to preserve the remedial impact of civil penalties and to 
foster compliance with the law, the Federal Civil Monetary Penalty 
Inflation Adjustment Act of 1990 ((``Adjustment Act''), 28 U.S.C. Sec. 
2461 note, Public Law 101-410), as amended by the Debt Collection 
Improvement Act of 1996 (``Collection Act,'' Pub. L. 104-134), requires 
us and other Federal agencies to regularly adjust certain civil 
penalties for inflation. Under these laws, each agency must make an 
initial inflationary adjustment for all applicable civil penalties, and 
must make further adjustments of these penalty amounts at least once 
every four years. The Collection Act limited the initial increase to 10 
percent of the penalty being adjusted.
    Our initial adjustment of civil penalties under these legislative 
authorities was published on February 4, 1997 (62 FR 5167). We 
established 49 CFR part 578, Civil Penalties, which applies to 
violations that occur on and after March 6, 1997. These adjustments 
resulted in the maximum permissible increases of 10 percent. On July 
14, 1999, we further adjusted certain penalties to enhance their 
deterrent effect (64 FR 37876), effective August 13, 1999. As we are 
now at the end of the four-year period following the initial 
adjustment, the purpose of this notice is to review the penalties that 
have remained unchanged since 1997, and to propose adjusting those 
penalties where the statutory formulae authorize it.

Method of Calculation

    Under the Adjustment Act as amended by the Collection Act, we 
determine the inflation adjustment for each applicable civil penalty by 
increasing the maximum civil penalty amount per violation by the cost-
of-living adjustment, and then applying a rounding factor. Sec. 5(b) of 
the Adjustment Act defines the ``cost-of-living'' adjustment as:

    The percentage (if any) for each civil monetary penalty by 
which--
    (1) the Consumer Price Index for the month of June of the 
calendar year preceding the adjustment exceeds
    (2) the Consumer Price Index for the month of June of the 
calendar year in which the amount of such civil monetary penalty was 
last set or adjusted pursuant to law.

    Since the proposed adjustment is intended to be effective before 
December 31, 2001, the ``Consumer Price Index [CPI] for the month of 
June of the calendar year preceding the adjustment'' would be the CPI 
for June 2000. This figure is 172.4. NHTSA's penalties were initially 
adjusted in February 1997 based on the CPI figure for June 1996, which 
was 156.7. The factor that we are using in calculating the increase, 
then, is 172.4 divided by 156.7, or 1.1001914. We shall use 1.1 as the 
appropriate figure. Any calculated increase under this adjustment is 
then subject to a specific rounding formula set forth in Sec. 5(a) of 
the Adjustment Act. Under the formula:
    Any increase shall be rounded to the nearest
    (1) multiple of $10 in the case of penalties less than or equal to 
$100;
    (2) multiple of $100 in the case of penalties greater than $100 but 
less than or equal to $1,000;
    (3) multiple of $1,000 in the case of penalties greater than $1,000 
but less than or equal to $10,000;
    (4) multiple of $5,000 in the case of penalties greater than 
$10,000 but less than or equal to $100,000;
    (5) multiple of $10,000 in the case of penalties greater than 
$100,000 but less than or equal to $200,000; and
    (6) multiple of $25,000 in the case of penalties greater than 
$200,000.

[[Page 27622]]

Review of Civil Penalties Prescribed by Section 578.6

    Section 578.6 contains the civil penalties authorized by the 
statutes that we enforce. We have reviewed these penalties, multiplied 
each of them by 1.1, considered the nearest higher multiple specified 
in the rounding provisions, and concluded that only the penalties 
discussed below may be increased.

Section 578.6(f) Odometer Tampering and Disclosure

    The maximum civil penalty for a related series of violations of 49 
U.S.C. Chapter 327 is $110,000, as specified in Sec. 578.6(f)(1). The 
inflation factor raises this figure to $121,000. Under the formula, any 
increase in a penalty shall 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. Accordingly, we propose that Sec. 576.8(f)(1) be 
amended to increase the maximum civil penalty to $120,000 for a related 
series of violations of the odometer tampering and disclosure 
provisions. However, the maximum civil penalty for a single violation 
remains at $2,200 because the inflation-adjusted figure of $2,420 is 
not yet at a level to be rounded to the nearest multiple of $1,000.

Section 578.6(g) Vehicle Theft Prevention

    Under Sec. 578.6(g)(1), the maximum civil penalty for a related 
series of violations of 49 U.S.C. 33114(a)(1-4) is $275,000. The 
inflation factor raises this figure to $302,500. Under the formula, any 
increase in a penalty shall be rounded to the nearest multiple of 
$25,000 in the case of penalties greater than $200,000. Accordingly, we 
propose that Sec. 576.8(g)(1) be amended to increase the maximum civil 
penalty to $300,000 for a related series of violations of the vehicle 
theft prevention provisions. However, the maximum penalty for a single 
violation remains at $1,100.
    Under Sec. 578.6(g)(2), a person that violates 49 U.S.C. 
33114(a)(5) is liable for a civil penalty of not more than $110,000 a 
day for each violation. The inflation factor modified by the rounding 
factor results in this penalty being raised to $120,000, and we are 
proposing this adjustment as well.

Effective Date

    The amendments would be effective 30 days after publication of the 
final rule in the Federal Register. The adjusted penalties would apply 
to violations occurring on and after the effective date.

Request for Comments

How Do I Prepare and Submit Comments?

    Your comments must be written and in English. To ensure that your 
comments are correctly filed in the Docket, please include the docket 
number of this document in your comments.
    Your comments must not be more than 15 pages long (49 CFR 553.21). 
We established this limit to encourage you to write your primary 
comments in a concise fashion. However, you may attach necessary 
additional documents to your comments. There is no limit on the length 
of the attachments.
    Please submit two copies of your comments, including the 
attachments, to Docket Management at the beginning of this document, 
under ADDRESSES.

How Can I Be Sure That My Comments Were Received?

    If you wish Docket Management to notify you upon its receipt of 
your comments, enclose a self-addressed, stamped postcard in the 
envelope containing your comments. Upon receiving your comments, Docket 
Management will return the postcard by mail.

How Do I Submit Confidential Business Information?

    If you wish to submit any information under a claim of 
confidentiality, you should submit three copies of your complete 
submission, including the information you claim to be confidential 
business information, to the Chief Counsel, NHTSA (NCC-30), at the 
address given at the beginning of this document under FOR FURTHER 
INFORMATION CONTACT. In addition, you should submit two copies from 
which you have deleted the claimed confidential business information, 
to Docket Management at the address given at the beginning of this 
document under ADDRESSES. When you send a comment containing 
information claimed to be confidential business information, you should 
include a cover letter setting forth the information specified in our 
confidential business information regulation, 49 CFR Part 512.

Will the Agency Consider Late Comments?

    We will consider all comments that Docket Management receives 
before the close of business on the comment closing date indicated at 
the beginning of this notice under DATES. Because we must issue a final 
rule not later than June 30, 2002, and a proposed rule in the interim, 
we are unlikely to extend the comment closing dates for this notice or 
for the proposed rule. However, in accordance with our policies, to the 
extent possible, we will also consider comments that Docket Management 
receives after the specified comment closing date. If Docket Management 
receives a comment too late for us to consider in developing the 
proposed rule, we will consider that comment as an informal suggestion 
for future rulemaking action.

How Can I Read the Comments Submitted by Other People?

    You may read the comments received by Docket Management at the 
address and times given near the beginning of this document under 
ADDRESSES.
    You may also see the comments on the internet. To read the comments 
on the internet, take the following steps:
    (1) Go to the Docket Management System (DMS) Web page of the 
Department of Transportation (http://dms.dot.gov/).
    (2) On that page, click on ``search.''
    (3) On the next page (http://dms.dot.gov/search/), type in the 
four-digit docket number shown at the heading of this document. 
Example: if the docket number were ``NHTSA-2001-1234,'' you would type 
``1234.''
    (4) After typing the docket number, click on ``search.''
    (5) The next page contains docket summary information for the 
docket you selected. Click on the comments you wish to see.
    You may download the comments. The comments are imaged documents, 
in either TIFF or pdf format. Please note that even after the comment 
closing date, we will continue to file relevant information in the 
Docket as it becomes available. Further, some people may submit late 
comments. Accordingly, we recommend that you periodically search the 
Docket for new material.

Rulemaking Analyses and Notices

Executive Order 12866 and DOT Regulatory Policies and Procedures

    We have considered the impact of this rulemaking action under 
Executive Order 12866 and the Department of Transportation's regulatory 
policies and procedures. This rulemaking document was not reviewed 
under Executive Order 12866, ``Regulatory Planning and Review.'' This 
action is limited to the proposed adoption of adjustments of civil 
penalties under statutes that the agency enforces, and has been 
determined to be not ``significant'' under the Department of 
Transportation's regulatory policies and procedures.

[[Page 27623]]

Regulatory Flexibility Act

    We have also considered the impacts of this notice under the 
Regulatory Flexibility Act. I certify that a final rule based on this 
proposal will have no significant economic impact on a substantial 
number of small entities.
    The following is my statement providing the factual basis for the 
certification (5 U.S.C. 605(b)). The proposed amendments primarily 
affect manufacturers of motor vehicles. Manufacturers of motor vehicles 
are generally not small businesses within the meaning of the Regulatory 
Flexibility Act.
    The Small Business Administration's regulations define a small 
business in part as a business entity ``which operates primarily within 
the United States.'' (13 CFR 121.105(a)) SBA's size standards are 
organized according to Standard Industrial Classification Codes (SIC), 
SIC Code 3711 ``Motor Vehicles and Passenger Car Bodies'' has a small 
business size standard of 1,000 employees or fewer.
    For manufacturers of passenger cars and light trucks, NHTSA 
estimates there are at most five small manufacturers of passenger cars 
in the U.S. Since each manufacturer serves a niche market, often 
specializing in replicas of ``classic'' cars, production for each 
manufacturer is fewer than 100 cars per year. Thus, there are at most 
500 cars manufactured per year by U.S. small businesses.
    In contrast, in 2001, there are approximately nine large 
manufacturers producing passenger cars, and light trucks in the U.S. 
Total U.S. manufacturing production per year is approximately 15 to 15 
and a half million passenger cars and light trucks. We do not believe 
small businesses manufacture even 0.1 percent of total U.S. passenger 
car and light truck production per year.
    Further, small organizations and governmental jurisdictions would 
not be significantly affected as the price of motor vehicles ought not 
to change as the result of this proposed rule. As explained above, this 
action is limited to the proposed adoption of a statutory directive, 
and has been determined to be not ``significant'' under the Department 
of Transportation's regulatory policies and procedures.
    Finally, this action would not affect our civil penalty policy 
under the Small Business Regulatory Enforcement Fairness Act (62 FR 
37115, July 10, 1997). We shall continue to consider the 
appropriateness of the penalty to the size of the business charged.

Paperwork Reduction Act

    In accordance with the Paperwork Reduction Act of 1980 (Pub. L. 96-
511), we state that there are no requirements for information 
collection associated with this rulemaking action.

National Environmental Policy Act

    We have also analyzed this rulemaking action under the National 
Environmental Policy Act and determined that it has no significant 
impact on the human environment.

Executive Order 12612 (Federalism)

    We have analyzed this proposed rule in accordance with the 
principles and criteria contained in Executive Order 12612, and have 
determined that it has no significant federalism implications to 
warrant the preparation of a Federalism Assessment.

Civil Justice Reform

    This proposed rule does not have a retroactive or preemptive 
effect. Judicial review of a rule based on this proposal may be 
obtained pursuant to 5 U.S.C. Sec. 702. That section does not require 
that a petition for reconsideration be filed prior to seeking judicial 
review.

Unfunded Mandates Reform Act of 1995

    The Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4) requires 
agencies to prepare a written assessment of the cost, benefits and 
other effects of proposed or final rules that include a Federal mandate 
likely to result in the expenditure by State, local, or tribal 
governments, in the aggregate, or by the private sector, of more than 
$100 million annually. Because this rule will not have a $100 million 
effect, no Unfunded Mandates assessment will be prepared.

List of Subjects in 49 CFR Part 578

    Imports, Motor vehicle safety, Motor vehicles, Rubber and Rubber 
Products, Tires, Penalties.
    1. The authority citation for 49 CFR Part 578 would continue to 
read as follows:

    Authority: Pub. L. 101-410, Pub. L. 104-134, 49 U.S.C. 30165, 
30505, 32308, 32309, 32507, 32709, 32710, 32912, and 33115; 
delegation of authority at 49 CFR 1.50.

    2. Section 578.6 would be amended by revising the last sentence of 
paragraph (f)(1), the last sentence of paragraph (g)(1), and paragraph 
(g)(2) to read as follows:

PART 578--CIVIL AND CRIMINAL PENALTIES

* * * * *


Sec. 578.6   Civil penalties for violations of specified provisions of 
Title 49 of the United States Code.

* * * * *
    (f) Odometer tampering and disclosure. (1) * * * The maximum civil 
penalty under this paragraph for a related series of violations is 
$120,000.
* * * * *
    (g) Vehicle theft prevention. (1) * * * The maximum penalty under 
this paragraph for a related series of violations is $300,000.
    (2) A person that violates 49 U.S.C. 33114(a)(5) is liable to the 
United States government for a civil penalty of not more than $120,000 
a day for each violation.
* * * * *

    Issued on: May 15, 2001.
Kenneth N. Weinstein,
Associate Administrator for Safety Assurance.
[FR Doc. 01-12551 Filed 5-17-01; 8:45 am]
BILLING CODE 4910-59-P