[Federal Register Volume 66, Number 225 (Wednesday, November 21, 2001)]
[Rules and Regulations]
[Pages 58644-58647]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 01-29029]



[[Page 58643]]

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Part IV





Department of the Interior





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Office of Surface Mining Reclamation and Enforcement



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30 CFR Parts 723 and 845



Civil Penalty Adjustments; Final Rule

  Federal Register / Vol. 66, No. 225 / Wednesday, November 21, 2001 / 
Rules and Regulations  

[[Page 58644]]


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DEPARTMENT OF THE INTERIOR

Office of Surface Mining Reclamation and Enforcement

30 CFR Parts 723 and 845

RIN 1029-AC00


Civil Penalty Adjustments

AGENCY: Office of Surface Mining Reclamation and Enforcement, Interior.

ACTION: Final rule.

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SUMMARY: This rule adjusts the penalty amount of certain civil monetary 
penalties authorized by the Surface Mining Control and Reclamation Act 
of 1977 (SMCRA). The rule implements the Federal Civil Penalties 
Inflation Adjustment Act of 1990 which requires that civil monetary 
penalties be adjusted for inflation at least once every four years.

EFFECTIVE DATE: November 28, 2001.

FOR FURTHER INFORMATION CONTACT: Andy DeVito, Office of Surface Mining 
Reclamation and Enforcement, Room 117, South Interior Building, 1951 
Constitution Avenue NW, Washington, DC 20240; Telephone (202) 208-2701. 
E-mail: [email protected].

SUPPLEMENTARY INFORMATION:

I. Background
    A. The Federal Civil Penalties Inflation Adjustment Act
    B. Method of Calculation
    C. Example of a Calculation
    D. Civil Monetary Penalties Affected by this Adjustment
    E. Effect of the Rule in Federal Program States and on Indian 
Lands
    F. Effect of the Rule on Approved State Programs.
II. Procedural Matters and Required Determinations

I. Background

A. The Federal Civil Penalties Inflation Adjustment Act

    In an effort to maintain the deterrent effect of civil monetary 
penalties (CMPs) and promote compliance with the law, the Federal Civil 
Penalties Inflation Adjustment Act of 1990 (Inflation Adjustment Act) 
(28 U.S.C. 2461 note) was amended by the Debt Collection Improvement 
Act of 1996 (Pub. L. 104-134) to require Federal agencies to regularly 
adjust CMPs for inflation. The Inflation Adjustment Act, as amended, 
requires each agency to make an initial inflationary adjustment for all 
applicable CMPs, and to make subsequent adjustments at least once every 
four years thereafter. The Office of Surface Mining Reclamation and 
Enforcement (we or OSM) last adjusted the CMP's authorized by SMCRA on 
November 28, 1997 (62 FR 63274). To satisfy the requirement of the 
Inflation Adjustment Act, we are again adjusting our CMP's according to 
the formula set forth in the law.
    Under the Inflation Adjustment Act, the inflation adjustment for a 
CMP is determined by increasing the CMP by the amount of the cost-of-
living adjustment, which is defined as the percentage of each CMP by 
which the Consumer Price Index for the month of June of the calendar 
year preceding the adjustment, exceeds the Consumer Price Index for the 
month of June of the calendar year in which the amount of the CMP was 
last set or adjusted. The Inflation Adjustment Act defines the Consumer 
Price Index as the Consumer Price Index for all urban consumers 
published by the Department of Labor (CPI-U). See 28 U.S.C. 2461 note. 
In addition, the Inflation Adjustment Act specifies that any resulting 
increases in a CMP (1) must be rounded according to a stated rounding 
formula, and (2) should apply only to violations that occur after the 
date the increase takes effect.

B. Method of Calculation

    Since this adjustment will be effective before December 31, 2001, 
we must use the CPI-U for the month of June 2000. That figure is 172.4. 
We last adjusted our civil monetary penalties in November 1997. 
Therefore, we must use the CPI-U for June 1997 which is 160.3. The 
factor that we have used in calculating the increase is 172.4 divided 
by 160.3, or 1.0754834, rounded to 1.075 (i.e., a 7.5 percent 
increase).
    Any increase under this adjustment is then subject to the rounding 
formula set forth in section 5(a) of the Inflation Adjustment Act. 
Under the formula, any increase must 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.

C. Example of a Calculation

    To explain the inflation adjustment calculation for the CMP amounts 
that were last adjusted in 1997, we will use the following example. Our 
regulations at 30 CFR 845.15(b) presently require the imposition of a 
civil penalty of not less that $825 for each day during which an 
operator fails to abate a violation within the specified abatement 
period contained in a notice of violation or a cessation order. 
Multiplying the $825 by the inflation factor of 1.075 results in a sum 
of $886.88. Then we round the raw inflation amount according to the 
rounding rules in section 5(a) of the Inflation Adjustment Act. Since 
we round only the increased amount, we calculate the increase amount by 
subtracting the current penalty amount from the raw inflation 
adjustment. Accordingly, the increased amount for the penalty in our 
example is $61.88 (i.e., $886.88 minus $825.00). Under the rounding 
rules, if the penalty is more than $100 but less than $1,000, we round 
the increase to the nearest multiple of $100 (i.e., $61.88 is rounded 
to $100.00). Finally, we add the rounded increase to the existing 
penalty which results in a new Sec. 845.15(b) penalty amount of $925.00 
(i.e., $825.00 plus $100.00) for each day during which the failure to 
abate continues.

D. Civil Monetary Penalties Affected by This Adjustment

    Section 518 of SMCRA, 30 U.S.C. 1268, authorizes the Secretary of 
the Interior to assess CMPs for violations of SMCRA. OSM's regulations 
implementing the CMP provisions of section 518 are located in 30 CFR 
723.14, 723.15, 724.14, 845.14, 845.15, and 846.14. Because of the 
rounding formula specified in the Inflation Adjustment Act, a 
substantial number of the CMP's in those sections will remain unchanged 
at this review. Those CMP's (the ones for which no adjustment is being 
made in 2001) will be subject to slightly different treatment when 
calculating the 2005 adjustment. Under the Inflation Adjustment Act, 
when we adjust those penalties in 2005, we will be required to use the 
CPI-U for June of the year when they were last adjusted which will be 
the CPI-U for June 1997. The 1997 CPI-U will be compared to the June 
CPI-U for 2004 to arrive at the factor which will be used to calculate 
the inflation increase.

E. Effect of the Rule in Federal Program States and on Indian Lands

    The increase in civil monetary penalties contained in this rule 
will apply through cross-referencing to the following Federal program 
states: California, Georgia, Idaho, Massachusetts, Michigan, North 
Carolina, Oregon, Rhode Island, South Dakota, Tennessee and Washington. 
The Federal programs for these States appear

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at 30 CFR parts 905, 910, 912, 921, 922, 933, 937, 939, 941, 942 and 
947, respectively. The increase in civil monetary penalties also 
applies through cross-referencing to Indian lands under the Federal 
program for Indian lands as provided in 30 CFR 750.

F. Effect of the Rule on Approved State Programs

    Section 518(i) of SMCRA and 30 CFR 840.13(a) require that the civil 
penalty provisions of each State program contain penalties which are 
``no less stringent than'' those set forth in SMCRA. Following 
publication of this final rule, we will evaluate the State programs 
approved under section 503 of SMCRA to determine any changes in those 
programs that will be necessary. When we determine that a particular 
State program provision should be amended in order to be made no less 
stringent than the revised Federal regulations, the particular State 
will be notified in accordance with the provisions of 30 CFR 732.17.

II. Procedural Matters and Required Determinations

Administrative Procedure Act

    This final rule has been issued without prior public notice or 
opportunity for public comment. The Administrative Procedure Act (APA) 
(5 U.S.C. 553) provides an exception to the notice and comment 
procedures when an agency finds there is good cause for dispensing with 
such procedures on the basis that they are impracticable, unnecessary 
or contrary to the public interest. We have determined that under 5 
U.S.C. 553(b)(3)(B), good cause exists for dispensing with the notice 
of proposed rulemaking and public comment procedures for this rule. 
This rulemaking is consistent with the statutory authority and 
requirements set forth in the Inflation Adjustment Act as amended by 
the Debt Collection Improvement Act of 1996. The Inflation Adjustment 
Act requires that we adjust our CMPs once every four years and 
specifies the manner in which the adjustment is to be made. 
Accordingly, the adjustments made may be seen as ministerial, 
technical, and non-controversial. For these same reasons, we believe 
there is good cause under 5 U.S.C. 553(d)(3) of the APA to have the 
rule become effective on a date that is less than 30 days after the 
date of publication in the Federal Register.

Executive Order 12866--Regulatory Planning and Review

    This rule is not considered a significant regulatory action under 
the provisions of Executive Order 12866. The rule adjusts OSM's CMPs 
according to the formula contained in the law. OSM has no discretion in 
making the adjustments. Further, most coal mining operations subject to 
these regulations do not engage in prohibited activities and practices, 
and, as a result, we believe that the aggregate economic impact of 
these revised regulations will be minimal, affecting only those who may 
engage in prohibited behavior in violation of SMCRA. In calendar years 
1999 and 2000 combined, we issued a total of 101 violation notices (24 
cessation orders and 77 notices of violations. The total CMP amount 
assessed by OSM for all of these violations was $664,795.
    We do not keep records of the amount of CMPs assessed by State 
Regulatory Authorities. In a 1980 decision on OSM's regulations 
governing CMPs, the U.S. District Court for the District of Columbia 
held that ``because section 518 of SMCRA fails to enumerate a point 
system for assessing civil penalties, the imposition of this 
requirement upon the States is inconsistent with [SMCRA].'' 
Consequently, we cannot require that the CMP provisions contained in a 
State's regulatory program mirror the point/penalty provisions of 30 
CFR 723.14 and 845.14. The State regulatory programs, however, are 
required to have civil penalty provisions that are no less stringent 
than those set forth in section 518 of SMCRA. This includes the CMP 
provisions of section 518(h) which require the assessment of at least 
the minimum CMP specified there for the failure to abate a violation 
within the period of time permitted for abatement. During the past two 
years, the States issued a total of 743 failure-to-abate cessation 
orders. If you assume that each failure-to-abate cessation order was 
assessed the minimum CMP authorized, the annual assessment for all CMPs 
issued by all States for all failure-to-abate cessation orders would be 
substantially less than the dollar threshold established in Executive 
Order 12866 for a significant rule. Consequently, the amount of the 
CMPs that will eventually be assessed under the revised schedule 
contained in this rule by both OSM and the States is not expected to 
exceed the threshold contained in Executive Order 12866 for a 
significant rule.

Regulatory Flexibility Act

    The Department of the Interior certifies that this proposed 
revision will not have a significant economic impact on a substantial 
number of small entities under the Regulatory Flexibility Act (5 U.S.C. 
601 et seq.). The aggregate economic impact of this rulemaking on small 
business entities should be minimal, affecting only those who violate 
the provisions of SMCRA. As indicated above, the number of civil 
penalties assessed over a two-year period was not significant when 
compared to the number of Federal inspections performed (over 2,000 in 
calendar year 2,000).

Small Business Regulatory Enforcement Fairness Act

    This rule is not a major rule under 5 U.S.C. 804(2), the Small 
Business Regulatory Enforcement Fairness Act. This rule:
    1. Does not have an annual effect on the economy of $100 million or 
more for the reasons stated above.
    2. Will not cause a major increase in costs or prices for 
consumers, individual industries, federal, state, or local government 
agencies, or geographic regions because the rule does not impose new 
requirements on the coal mining industry or consumers.
    3. Does not have significant adverse effects on competition, 
employment, investment, productivity, innovation, or the ability of 
U.S. based enterprises to compete with foreign-based enterprises for 
the reasons stated above.

Unfunded Mandates Reform Act

    For purposes of compliance with the Unfunded Mandates Reform Act of 
1995, this rule does not impose any obligations that individually or 
cumulatively would require an aggregate expenditure of $100 million or 
more by State, local, and Tribal governments and the private sector in 
any given year.

Federal Paperwork Reduction Act

    This rule does not contain collections of information which require 
approval by the Office of Management and Budget under 44 U.S.C. 3501 et 
seq.

National Environmental Policy Act

    We have reviewed this rule and determined that it is categorically 
excluded from the requirement to prepare an environmental document 
under the National Environmental Policy Act of 1969. This determination 
was made in accordance with the Departmental Manual (516 DM 2, Appendix 
1.10).

Executive Order 12988--Civil Justice Reform

    In accordance with Executive Order 12988, the Department of the 
Interior has determined that this rule (1) does not unduly burden the 
judicial system

[[Page 58646]]

and (2) meets the requirements of sections 3(a) and 3(b)(2) of the 
Order. Additional remarks follow concerning individual elements of the 
Executive Order:
    1. What is the preemptive effect, if any, to be given to the 
regulation?
    This regulation will have the same preemptive effect as other 
standards adopted pursuant to SMCRA. To retain primacy, States have to 
adopt and apply standards for their regulatory programs that are no 
less effective than those set forth in OSM's regulations. Any State law 
that is inconsistent with or that would preclude implementation of the 
proposed regulation would be subject to preemption under SMCRA section 
505 and implementing regulations at 30 CFR 730.11. To the extent that 
the proposed regulation would result in preemption of State law, the 
provisions of SMCRA are intended to preclude inconsistent State laws 
and regulations. This approach is established in SMCRA, and has been 
judicially affirmed. See Hodel v. Virginia Surface Mining and 
Reclamation Ass'n, 452 U.S. 264 (1981).
    2. What is the effect on existing Federal law or regulation, if 
any, including all provisions repealed or modified?
    This rule modifies the implementation of SMCRA as described herein, 
and is not intended to modify the implementation of any other Federal 
statute. The preceding discussion of this rule specifies the Federal 
regulatory provisions that are affected by this rule.
    3. What is the retroactive effect, if any, to be given to the 
regulation?
    This rule is not intended to have a retroactive effect. The 
increase in the amount of CMPs will apply only to violations that occur 
after the date the increase takes effect.
    4. Are administrative proceedings required before parties may file 
suit in court? Which proceedings apply? Is the exhaustion of 
administrative remedies required?
    No administrative proceedings are required before parties may file 
suit in court challenging the provisions of this rule under section 
526(a) of SMCRA, 30 U.S.C. 1276(a). Prior to any judicial challenges to 
the application of the rule, however, administrative proceedings must 
be exhausted, unless specified otherwise. In situations involving OSM 
application of the rule, applicable administrative proceedings may be 
found in 30 CFR 723.19, 845.19 and 43 CFR part 4. In situations 
involving State regulatory authority application of the provisions 
equivalent to those contained in this rule, applicable administrative 
procedures are set forth in the particular State program.
    5. Does the rule define key terms, either explicitly or by 
reference to other regulations or statutes that explicitly define those 
items?
    Terms which are important to the understanding of this rule are 
discussed in the rule.

Executive Order 13211--Regulations That Significantly Affect the 
Supply, Distribution, or Use of Energy

    Executive Order 13211 requires agencies to prepare a Statement of 
Energy Effects for a rule that is (1) considered significant under 
Executive Order 12866, and (2) likely to have a significant adverse 
effect on the supply, distribution, or use of energy. Because this rule 
is not considered significant under Executive Order 12866 and is not 
expected to have a significant adverse effect on the supply, 
distribution, or use of energy, a Statement of Energy Effects is not 
required.

Executive Order 12630--Takings

    In accordance with Executive Order 12630, the rule does not have 
takings implications. This determination is based on the fact that the 
rule will not have an impact on the use or value of private property 
and so, does not result in significant costs to the government.

Executive Order 13132--Federalism

    This rule does not have Federalism implications. It 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.''

List of Subjects

30 CFR Part 723

    Administrative practice and procedure, Penalties, Surface mining, 
Underground mining.

30 CFR Part 845

    Administrative practice and procedure, Law enforcement, Penalties, 
Reporting and recordkeeping requirements, Surface mining, Underground 
mining.

    Dated: November 7, 2001.
J. Steven Griles,
Acting Assistant Secretary, Land and Minerals Management.

    For the reasons set out in the preamble, 30 CFR parts 723 and 845 
are amended as follows.

PART 723--CIVIL PENALTIES

    1. The authority citation for Part 723 is revised to read as 
follows:

    Authority: 28 U.S.C. 2461, 30 U.S.C. 1201 et seq., Pub. L. 100-
34, Pub. L. 101-410, and Pub. L. 104-134.


    2. Section 723.14 is amended by revising the table to read as 
follows:


Sec. 723.14  Determination of amount of penalty.

* * * * *

------------------------------------------------------------------------
                            Points                              Dollars
------------------------------------------------------------------------
1............................................................         22
2............................................................         44
3............................................................         66
4............................................................         98
5............................................................        110
6............................................................        132
7............................................................        154
8............................................................        176
9............................................................        198
10...........................................................        220
11...........................................................        242
12...........................................................        264
13...........................................................        286
14...........................................................        308
15...........................................................        330
16...........................................................        352
17...........................................................        374
18...........................................................        396
19...........................................................        418
20...........................................................        440
21...........................................................        462
22...........................................................        484
23...........................................................        506
24...........................................................        528
25...........................................................        550
26...........................................................        660
27...........................................................        870
28...........................................................        980
29...........................................................      1,090
30...........................................................      1,100
31...........................................................      1,210
32...........................................................      1,320
33...........................................................      1,430
34...........................................................      1,540
35...........................................................      1,650
36...........................................................      1,760
37...........................................................      1,870
38...........................................................      1,980
39...........................................................      2,090
40...........................................................      2,200
41...........................................................      2,310
42...........................................................      2,420
43...........................................................      2,530
44...........................................................      2,640
45...........................................................      2,750
46...........................................................      2,860
47...........................................................      2,970
48...........................................................      3,080
49...........................................................      3,190
50...........................................................      3,300
51...........................................................      3,410
52...........................................................      3,520
53...........................................................      3,630
54...........................................................      3,740
55...........................................................      3,850
56...........................................................      3,960
57...........................................................      4,070
58...........................................................      4,180
59...........................................................      4,290
60...........................................................      4,400
61...........................................................      4,510
62...........................................................      4,620
63...........................................................      4,730

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64...........................................................      4,840
65...........................................................      4,950
66...........................................................      5,060
67...........................................................      5,170
68...........................................................      5,280
69...........................................................      5,390
70...........................................................      5,500
------------------------------------------------------------------------


    3. In Sec. 723.15, paragraph (b) is amended by changing the dollar 
amount ``$825'' to ``$925.''

PART 845--CIVIL PENALTIES

    4. The authority citation for Part 845 is revised to read as 
follows:

    Authority: 28 U.S.C. 2461, 30 U.S.C. 1201 et seq., Pub. L. 100-
34, Pub. L. 100-202, Pub. L. 100-446, Pub. L. 101-410, and Pub. L. 
104-134.


    5. Section 845.14 is amended by revising the table to read as 
follows:


Sec. 845.14  Determination of amount of penalty.

* * * * *

------------------------------------------------------------------------
                            Points                              Dollars
------------------------------------------------------------------------
1............................................................         22
2............................................................         44
3............................................................         66
4............................................................         98
5............................................................        110
6............................................................        132
7............................................................        154
8............................................................        176
9............................................................        198
10...........................................................        220
11...........................................................        242
12...........................................................        264
13...........................................................        286
14...........................................................        308
15...........................................................        330
16...........................................................        352
17...........................................................        374
18...........................................................        396
19...........................................................        418
20...........................................................        440
21...........................................................        462
22...........................................................        484
23...........................................................        506
24...........................................................        528
25...........................................................        550
26...........................................................        660
27...........................................................        870
28...........................................................        980
29...........................................................      1,090
30...........................................................      1,100
31...........................................................      1,210
32...........................................................      1,320
33...........................................................      1,430
34...........................................................      1,540
35...........................................................      1,650
36...........................................................      1,760
37...........................................................      1,870
38...........................................................      1,980
39...........................................................      2,090
40...........................................................      2,200
41...........................................................      2,310
42...........................................................      2,420
43...........................................................      2,530
44...........................................................      2,640
45...........................................................      2,750
46...........................................................      2,860
47...........................................................      2,970
48...........................................................      3,080
49...........................................................      3,190
50...........................................................      3,300
51...........................................................      3,410
52...........................................................      3,520
53...........................................................      3,630
54...........................................................      3,740
55...........................................................      3,850
56...........................................................      3,960
57...........................................................      4,070
58...........................................................      4,180
59...........................................................      4,290
60...........................................................      4,400
61...........................................................      4,510
62...........................................................      4,620
63...........................................................      4,730
64...........................................................      4,840
65...........................................................      4,950
66...........................................................      5,060
67...........................................................      5,170
68...........................................................      5,280
69...........................................................      5,390
70...........................................................      5,500
------------------------------------------------------------------------

Sec. 845.15  [Amended]

    6. In Sec. 845.15, paragraph (b) is amended by changing the dollar 
amount ``$825'' to ``$925.''

[FR Doc. 01-29029 Filed 11-20-01; 8:45 am]
BILLING CODE 4310-05-P