[Federal Register Volume 70, Number 2 (Tuesday, January 4, 2005)]
[Rules and Regulations]
[Pages 297-298]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 05-100]



[[Page 297]]

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DEPARTMENT OF EDUCATION

34 CFR Part 36


Adjustment of Civil Monetary Penalties for Inflation

AGENCY: Department of Education.

ACTION: Final regulations.

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SUMMARY: The Department of Education (Department) issues these final 
regulations to adjust the Department's civil monetary penalties (CMPs) 
for inflation.

DATES: These regulations are effective January 4, 2005.

FOR FURTHER INFORMATION CONTACT: Lisa Kanter, Office of the General 
Counsel, U.S. Department of Education, 400 Maryland Avenue, SW., room 
6E205, Washington, DC 20202-2241. Telephone: (202) 401-8300.
    If you use a telecommunications device for the deaf (TDD), you may 
call the Federal Information Relay Service (FIRS) at 1 (800) 877-8339.
    Individuals with disabilities may obtain this document in an 
alternative format (e.g., Braille, large print, audiotape, or computer 
diskette) on request to the contact person listed under FOR FURTHER 
INFORMATION CONTACT.

SUPPLEMENTARY INFORMATION: The Federal Civil Penalties Adjustment Act 
of 1990 (Inflation Adjustment Act) (28 U.S.C. 2461 note), as amended by 
the Debt Collection Improvement Act of 1996 (DCIA) (31 U.S.C. 3701 
note), provides for the regular evaluation of CMPs to ensure that they 
continue to maintain their deterrent value. As amended by the DCIA, the 
Inflation Adjustment Act requires that each agency issue regulations to 
adjust its CMPs beginning in 1996 and at least every 4 years 
thereafter. The Department's initial adjustment to each CMP was 
published in the Federal Register on November 18, 2002 (67 FR 69654) 
and became effective on the date of publication. Although it has not 
been 4 years since the Department's last adjustments, had the 
Department published adjustments in 1996 and 2000, it would now be time 
to adjust its CMPs. Accordingly, the Department is now making any 
necessary adjustments.
    A CMP is defined in the statute as any penalty, fine, or other 
sanction that is (1) for a specific monetary amount as provided by 
Federal law, or has a maximum amount provided for by Federal law; (2) 
assessed or enforced by an agency pursuant to Federal law; and (3) 
assessed or enforced pursuant to an administrative proceeding or a 
civil action in the Federal courts.
    The formula for the amount of a CMP inflation adjustment is 
prescribed by law and is not subject to the exercise of discretion by 
the Secretary of the Department of Education (Secretary). The 
adjustment reflects the percentage increase in the Consumer Price Index 
for all urban consumers (CPI-U) published by the Department of Labor 
from June of the calendar year in which the amount was last set or 
adjusted pursuant to law, to June of the calendar year preceding the 
adjustment.
    Four of the Department's CMP were adjusted in 2002. These CMPs are 
(1) 20 U.S.C. 1082(g), which provides for a fine of up to $27,500 for 
violations by lenders and guaranty agencies of Title IV-B of the Higher 
Education Act of 1965, as amended (HEA), which authorizes the Federal 
Family Education Loan Program; (2) 20 U.S.C. 1094(c)(3)(B), which 
provides for a fine of up to $27,500 for an institution of higher 
education's violation of Title IV of the HEA, which authorizes various 
programs of student financial assistance; (3) 31 U.S.C. 1352(c)(1) and 
(c)(2)(A), which provide for a fine of $11,000 to $110,000 for 
recipients of Government grants, contracts, etc. that lobby Congress or 
the Executive Branch with respect to the award of Government grants and 
contracts; and (4) 31 U.S.C. 3802(a)(1) and (a)(2), which provide for a 
fine of up to $5,500 for false claims and statements made to the 
Government. For these four CMPs, not enough inflation has occurred 
since 2002 to require an adjustment under the Inflation Adjustment Act.
    Two of the Department's CMPs were enacted as part of the Higher 
Education Amendments of 1998 (Pub. L. 105-244). These CMPs are 20 
U.S.C. 1015(c)(5), which provides for a fine of up to $25,000 for 
failure by an institution of higher education (IHE) to provide 
information on the cost of higher education to the Commissioner of 
Education Statistics, and 20 U.S.C. 1027(f)(3), which provides for a 
fine of up to $25,000 for failure by an IHE to provide information to 
the State and the public regarding its teacher preparation programs. In 
2002, when the Department last adjusted its CMPs, not enough inflation 
had occurred to require an adjustment to these CMPs under the Inflation 
Adjustment Act. At this time, however, there has been more than 10 
percent inflation, warranting an adjustment for each of these CMPs. By 
statute, the Department's first adjustment of a CMP may not exceed 10 
percent of such a penalty, and, therefore, we are adjusting these CMPs 
by 10 percent.
    Two additional points regarding the Department's adjustments are 
worth noting. First, the Department is using the following CPI-U 
figures as measures of inflation: 163 for June 1998; 179.9 for June 
2002; and 183.7 for June 2003. Second, the increases to the 
Department's CMPs due to these inflation adjustments apply only to 
violations that occur after the effective date of the adjustments.

Waiver of Proposed Rulemaking

    Under the Administrative Procedure Act (5 U.S.C. 553), the 
Department generally offers interested parties the opportunity to 
comment on proposed regulations. However, these regulations merely 
implement the statutory mandate to adjust CMPs for inflation. The 
regulations reflect administrative computations performed by the 
Department as prescribed by the statute and do not establish or affect 
substantive policy. Therefore, under 5 U.S.C. 553(b)(B), the Secretary 
has determined that public notice and comment are impracticable, 
unnecessary, and contrary to the public interest.

Regulatory Flexibility Act Certification

    The Secretary certifies that these regulations will not have a 
significant economic impact on a substantial number of small entities. 
The formula for the amount of the inflation adjustments is prescribed 
by statute and is not subject to the exercise of discretion by the 
Secretary. These CMPs are infrequently imposed by the Secretary, and 
the regulations do not involve any special considerations that might 
affect the imposition of CMPs on small entities.

Paperwork Reduction Act of 1995

    These regulations do not contain any information collection 
requirements.

Assessment of Educational Impact

    Based on our own review, we have determined that these final 
regulations do not require transmission of information that any other 
agency or authority of the United States gathers or makes available.

Electronic Access to This Document

    You may view this document, as well as all other documents of this 
Department published in the Federal Register, in text or Adobe Portable 
Document Format (PDF) on the Internet at the following site: http://www.ed.gov/news/fedregister.
    To use PDF you must have Adobe Acrobat Reader, which is available 
free at this site. If you have questions about

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using PDF, call the U.S. Government Printing Office (GPO), toll free, 
at 1-888-293-6498; or in the Washington, DC, area at (202) 512-1530.

    Note: The official version of this document is the document 
published in the Federal Register. Free Internet access to the 
official edition of the Federal Register and the Code of Federal 
Regulations is available on GPO Access at: http://www.gpoaccess.gov/nara/index.html.

(Catalog of Federal Domestic Assistance Number does not apply)

List of Subjects in 34 CFR Part 36

    Claims, Fraud, Penalties.

    Dated: December 28, 2004.
Eugene W. Hickok,
Deputy Secretary of Education.

0
For the reasons discussed in the preamble, the Secretary amends part 36 
in title 34 of the Code of Federal Regulations as follows:

PART 36--ADJUSTMENT OF CIVIL MONETARY PENALTIES FOR INFLATION

0
1. The authority citation for part 36 continues to read as follows:

    Authority: 28 U.S.C. 2461 note and 31 U.S.C. 3701 note, unless 
otherwise noted.


0
2. Section 36.2 is amended by revising Table I to read as follows:


Sec.  36.2  Penalty adjustment.

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                      Table I, Section 36.2.--Civil Monetary Penalty Inflation Adjustments
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                                                                                 New maximum (and minimum, if
                    Statute                             Description               applicable) penalty amount
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20 U.S.C. 1015(c)(5)..........................  Provides for a fine of up    $27,500.
                                                 to $25,000 for failure by
                                                 an institution of higher
                                                 education (IHE) to provide
                                                 information on the cost of
                                                 higher education to the
                                                 Commissioner of Education
                                                 Statistics.
20 U.S.C. 1027(f)(3)..........................  Provides for a fine of up    $27,500.
                                                 to $25,000 for failure by
                                                 an IHE to provide
                                                 information to the State
                                                 and the public regarding
                                                 its teacher-preparation
                                                 programs.
20 U.S.C. 1082(g).............................  Provides for a civil         $27,500.
                                                 penalty of up to $25,000
                                                 for violations by lenders
                                                 and guaranty agencies of
                                                 Title IV-B of the Higher
                                                 Education Act of 1965, as
                                                 amended (HEA), which
                                                 authorizes the Federal
                                                 Family Education Loan
                                                 Program.
20 U.S.C. 1094(c)(3)(B).......................  Provides for a civil         $27,500.
                                                 penalty of up to $25,000.
                                                 for an institution of
                                                 higher education's
                                                 violation of Title IV of
                                                 the Higher Education Act
                                                 of 1965, as amended, which
                                                 authorizes various
                                                 programs of student
                                                 financial assistance.
31 U.S.C. 1352(c)(1) and (c)(2)(A)............  Provides for a civil         $11,000 to $110,000.
                                                 penalty of $10,000 to
                                                 $100,000 for recipients of
                                                 Government grants,
                                                 contracts, etc. that lobby
                                                 Congress or the Executive
                                                 Branch with respect to the
                                                 award of Government grants
                                                 and contracts.
31 U.S.C. 3802(a)(1) and (a)(2)...............  Provides for a civil         $5,500.
                                                 penalty of up to $5,000.
                                                 for false claims and
                                                 statements made to the
                                                 Government.
----------------------------------------------------------------------------------------------------------------

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[FR Doc. 05-100 Filed 1-3-05; 8:45 am]
BILLING CODE 4000-01-P