[Federal Register Volume 84, Number 58 (Tuesday, March 26, 2019)]
[Rules and Regulations]
[Pages 11222-11224]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-05577]


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DEPARTMENT OF THE INTERIOR

Bureau of Ocean Energy Management

30 CFR Parts 550 and 553

[Docket ID: BOEM-2019-0079; MMAA104000]
RIN 1010-AE03


Oil and Gas and Sulfur Operations in the Outer Continental Shelf-
Civil Penalties Inflation Adjustments

AGENCY: Bureau of Ocean Energy Management, Interior.

ACTION: Final rule.

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SUMMARY: This final rule implements the 2019 adjustment of the level of 
the maximum daily civil monetary penalties contained in the Bureau of 
Ocean Energy Management (BOEM) regulations for violations of the Outer 
Continental Shelf Lands Act (OCSLA) and the Oil Pollution Act of 1990 
(OPA), in accordance with the Federal Civil Penalties Inflation 
Adjustment Act Improvements Act of 2015 and relevant Office of 
Management and Budget (OMB) guidance. The 2019 adjustment multiplier of 
1.02522 accounts for one year of inflation spanning the period from 
October 2017 through October 2018.

DATES: This rule is effective on March 26, 2019.

FOR FURTHER INFORMATION CONTACT: Deanna Meyer-Pietruszka, Chief, Office 
of Policy, Regulation and Analysis, Bureau of Ocean Energy Management, 
at (202) 208-6352 or by email at [email protected].

SUPPLEMENTARY INFORMATION:

I. Background and Legal Authority
II. Calculation of 2019 Adjustments
III. Procedural Requirements
    A. Regulatory Planning and Review (E.O. 12866, 13563, and 13771)
    B. Regulatory Flexibility Act
    C. Small Business Regulatory Enforcement Fairness Act
    D. Unfunded Mandates Reform Act
    E. Takings (E.O. 12630)
    F. Federalism (E.O. 13132)
    G. Civil Justice Reform (E.O. 12988)
    H. Consultation With Indian Tribes (E.O. 13175 and Departmental 
Policy)
    I. Paperwork Reduction Act
    J. National Environmental Policy Act
    K. Effects on the Energy Supply (E.O. 13211)

I. Background and Legal Authority

    The OCSLA directs the Secretary of the Interior to adjust the OCSLA 
maximum daily civil penalty amount at least once every three years to 
reflect any increase in the Consumer Price Index to account for 
inflation (43 U.S.C. 1350(b)(1)).
    The OPA does not include a maximum daily civil penalty inflation 
adjustment provision.
    The Federal Civil Penalties Inflation Adjustment Act Improvements 
Act of 2015 (Sec. 701 of Pub. L. 114-74) (FCPIAA of 2015) requires 
Federal agencies to promulgate annual inflation adjustments for civil 
monetary penalties. Specifically, the FCPIAA of 2015 required agencies 
to adjust the level of civil monetary penalties with an initial 
``catch-up'' adjustment through an interim final rulemaking (IFR) in 
2016, and required agencies to make subsequent annual adjustments for 
inflation, beginning in 2017. Agencies were required to publish the 
first annual inflation adjustments in the Federal Register by no later 
than January 15, 2017, and must publish recurring annual inflation 
adjustments by no later than January 15 of each subsequent year. The 
purpose of these adjustments is to maintain the deterrent effect of 
civil penalties and to further the policy goals of the underlying 
statutes. For this year's annual inflation adjustment, BOEM is 
publishing this rule after the statutory January 15 deadline because of 
a lapse in government funding that began on December 22, 2018, and 
ended on January 25, 2019.
    BOEM last adjusted the levels of civil monetary penalties in BOEM 
regulations through a final rule, RIN 1010-AD99 [83 FR 8930], which was 
published on March 2, 2018.
    The OMB Memorandum M-19-04 (Implementation of Penalty Inflation 
Adjustments for 2019, Pursuant to the Federal Civil Penalties Inflation 
Adjustment Act Improvements Act of 2015; https://www.whitehouse.gov/wp-content/uploads/2017/11/m_19_04.pdf), issued December 14, 2018, 
explains agency statutory responsibilities for: Identifying applicable 
penalties and performing the annual adjustment; publishing revisions to 
regulations to implement the adjustment in the Federal Register; 
applying adjusted penalty levels; and performing agency oversight of 
inflation adjustments.
    BOEM is promulgating this 2019 inflation adjustment for the OCSLA 
and OPA maximum daily civil penalties as a final rule pursuant to the 
provisions of the FCPIAA of 2015 and OMB guidance. A proposed rule is 
not required because the FCPIAA of 2015 expressly exempted the annual 
inflation adjustments implemented pursuant to the FCPIAA of 2015 from 
the pre-promulgation notice and comment requirements of the 
Administrative Procedure Act, 5 U.S.C. 553 et seq. (the APA), allowing 
those adjustments to be published directly as final rules.

[[Page 11223]]

Specifically, the FCPIAA of 2015 states that agencies shall adjust 
civil monetary penalties ``notwithstanding Section 553 of the 
Administrative Procedure Act.'' (FCPIAA of 2015 at section 4(b)(2)). 
This interpretation of the FCPIAA of 2015 is confirmed by OMB 
Memorandum M-19-04 at 4 (``This means that the public procedure the APA 
generally requires (i.e., notice, an opportunity for comment, and a 
delay in effective date) is not required for agencies to issue 
regulations implementing the annual adjustment.'').

II. Calculation of 2019 Adjustments

    Under the FCPIAA of 2015 and the guidance provided in OMB 
Memorandum M-19-04, BOEM has identified applicable civil monetary 
penalties and calculated the necessary inflation adjustments. The 
previous civil penalty inflation adjustments accounted for inflation 
through October 2017. The required annual civil penalty inflation 
adjustments promulgated through this rule account for inflation through 
October 2018.
    Annual inflation adjustments are based on the percent change 
between the Consumer Price Index for all Urban Consumers (CPI-U) for 
the October preceding the date of the adjustment, and the prior year's 
October CPI-U. Consistent with the guidance in OMB Memorandum M-19-04, 
BOEM divided the October 2018 CPI-U by the October 2017 CPI-U to 
calculate the multiplying factor. In this case, October 2018 CPI-U 
(252.885)/October 2017 CPI-U (246.663) = 1.02522. OMB Memorandum M-19-
04 confirms that this is the proper multiplier. (See OMB Memorandum M-
19-04 at 1 and n.4).
    For 2019, OCSLA and the FCPIAA of 2015 require that BOEM adjust the 
OCSLA maximum daily civil penalty amount. To accomplish this, BOEM 
multiplied the existing OCSLA maximum daily civil penalty amount 
($43,576) by the multiplying factor ($43,576 x 1.02522 = $44,674.99). 
The FCPIAA of 2015 requires that the resulting amount be rounded to the 
nearest $1.00 at the end of the calculation process. Accordingly, the 
adjusted OCSLA maximum daily civil penalty is $44,675.
    For 2019, the FCPIAA of 2015 requires that BOEM adjust the OPA 
maximum daily civil penalty amount. To accomplish this, BOEM multiplied 
the current OPA maximum daily civil penalty amount ($46,192) by the 
multiplying factor ($46,192 x 1.02522 = $47,356.96). The FCPIAA of 2015 
requires that the resulting amount be rounded to the nearest $1.00 at 
the end of the calculation process. Accordingly, the adjusted OPA 
maximum daily civil penalty is $47,357.
    The adjusted penalty levels will take effect immediately upon 
publication of this rule. Pursuant to the FCPIAA of 2015, the increases 
in the OCSLA and OPA maximum daily civil penalty amounts apply to civil 
penalties assessed after the date the relevant increase takes effect, 
even if the associated violation(s) predates such increase. Consistent 
with the provisions of OCSLA, OPA, and the FCPIAA of 2015, this rule 
adjusts the following maximum civil monetary penalties per day per 
violation as follows:

----------------------------------------------------------------------------------------------------------------
                                                                      Current                        Adjusted
             CFR citation                  Description of the         maximum       Multiplier        maximum
                                                 penalty              penalty                         penalty
----------------------------------------------------------------------------------------------------------------
30 CFR 550.1403.......................  Failure to comply per            $43,576         1.02522         $44,675
                                         day, per violation.
30 CFR 553.51(a)......................  Failure to comply per             46,192         1.02522          47,357
                                         day, per violation.
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III. Procedural Requirements

A. Regulatory Planning and Review (E.O. 12866, 13563, and 13771)

    Executive Order (E.O.) 12866 provides that the Office of 
Information and Regulatory Affairs (OIRA) in the OMB will review all 
significant rules. OIRA has determined that this rule is not 
significant. (See OMB Memorandum M-19-04 at 3).
    E.O. 13563 reaffirms the principles of E.O. 12866 while calling for 
improvements in the Nation's regulatory system to reduce uncertainty 
and to promote predictability and the use of the best, most innovative, 
and least burdensome tools for achieving regulatory ends. E.O. 13563 
directs agencies to consider regulatory approaches that reduce burdens 
and maintain flexibility and freedom of choice for the public where 
these approaches are relevant, feasible, and consistent with regulatory 
objectives. We have developed this rule in a manner consistent with 
these requirements, to the extent relevant and feasible given the 
limited discretion provided agencies in the FCPIAA of 2015.
    E.O. 13771 of January 30, 2017, directs Federal agencies to reduce 
the regulatory burden on regulated entities and control regulatory 
costs. E.O. 13771, however, applies only to significant regulatory 
actions, as defined in Section 3(f) of E.O. 12866. OIRA has determined 
that agency regulations exclusively implementing the annual adjustment 
required by the FCPIAA of 2015 are not significant regulatory actions 
under E.O. 12866, provided they are consistent with OMB Memorandum M-
19-04 (See OMB Memorandum M-19-04 at 3). Thus, E.O. 13771 does not 
apply to this rulemaking.

B. Regulatory Flexibility Act

    The Regulatory Flexibility Act (RFA) requires an agency to prepare 
a regulatory flexibility analysis for rules unless the agency certifies 
that the rule will not have a significant economic impact on a 
substantial number of small entities. The RFA applies only to rules for 
which an agency is required to first publish a proposed rule. (See 5 
U.S.C. 603(a) and 604(a)). The FCPIAA of 2015 expressly exempts these 
annual inflation adjustments from the requirement to publish a proposed 
rule for notice and comment. (See FCPIAA of 2015 at section 4(b)(2); 
OMB Memorandum M-19-04 at 4). Thus, the RFA does not apply to this 
rulemaking.

C. 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:
    (a) Will not have an annual effect on the economy of $100 million 
or more;
    (b) Will not cause a major increase in costs or prices for 
consumers, individual industries, Federal, State, or local government 
agencies, or geographic regions; and
    (c) Will 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.

D. Unfunded Mandates Reform Act

    This rule does not impose an unfunded mandate on state, local, or 
tribal governments, or the private sector, of more than $100 million 
per year. The rule does not have a significant or unique effect on 
state, local, or tribal governments or the private sector. Therefore, a 
statement containing the

[[Page 11224]]

information required by the Unfunded Mandates Reform Act (2 U.S.C. 1531 
et seq.) is not required.

E. Takings (E.O. 12630)

    This rule does not effect a taking of private property or otherwise 
have takings implications under E.O. 12630. Therefore, a takings 
implication assessment is not required.

F. Federalism (E.O. 13132)

    Under the criteria in section 1 of E.O. 13132, this rule does not 
have sufficient federalism implications to warrant the preparation of a 
federalism summary impact statement. To the extent that State and local 
governments have a role in outer Continental Shelf activities, this 
rule will not affect that role. Therefore, a federalism summary impact 
statement is not required.

G. Civil Justice Reform (E.O. 12988)

    This rule complies with the requirements of E.O. 12988. 
Specifically, this rule:
    (a) Meets the criteria of section 3(a) requiring that all 
regulations be reviewed to eliminate errors and ambiguity and be 
written to minimize litigation; and
    (b) Meets the criteria of section 3(b)(2) requiring that all 
regulations be written in clear language and contain clear legal 
standards.

H. Consultation With Indian Tribes (E.O. 13175 and Departmental Policy)

    The Department of the Interior strives to strengthen its 
government-to-government relationship with Indian tribes through a 
commitment to consultation with Indian tribes and recognition of their 
right to self-governance and tribal sovereignty. We have evaluated this 
rule under the Department of the Interior's consultation policy, under 
Departmental Manual Part 512, Chapters 4 and 5, and under the criteria 
in E.O. 13175. We have determined that it has no substantial direct 
effects on Federally-recognized Indian tribes or Alaska Native Claims 
Settlement Act (ANCSA) Corporations, and that consultation under the 
Department of the Interior's tribal and ANCSA consultation policies is 
not required.

I. Paperwork Reduction Act

    This rule does not contain information collection requirements, and 
a submission to the OMB under the Paperwork Reduction Act (44 U.S.C. 
3501 et seq.) is not required.

J. National Environmental Policy Act

    This rule does not constitute a major Federal action significantly 
affecting the quality of the human environment. A detailed statement 
under the National Environmental Policy Act of 1969 (NEPA) is not 
required because, as a regulation of an administrative nature, this 
rule is covered by a categorical exclusion (see 43 CFR 46.210(i)). BOEM 
also determined that the rule does not implicate any of the 
extraordinary circumstances listed in 43 CFR 46.215 that would require 
further analysis under NEPA. Therefore, a detailed statement under NEPA 
is not required.

K. Effects on the Energy Supply (E.O. 13211)

    This rule is not a significant energy action under the definition 
in E.O. 13211. Therefore, a Statement of Energy Effects is not 
required.

List of Subjects

30 CFR Part 550

    Administrative practice and procedure, Continental shelf, 
Environmental impact statements, Environmental protection, Federal 
lands, Government contracts, Investigations, Mineral resources, Oil and 
gas exploration, Outer continental shelf, Penalties, Pipelines, 
Reporting and recordkeeping requirements, Rights-of-way, Sulfur.

30 CFR Part 553

    Administrative practice and procedure, Continental shelf, Financial 
responsibility, Liability, Limit of liability, Oil and gas exploration, 
Oil pollution, Outer continental shelf, Penalties, Pipelines, Reporting 
and recordkeeping requirements, Rights-of-way, Surety bonds, Treasury 
securities.

    Dated: February 15, 2019.
Joseph R. Balash,
Assistant Secretary, Land and Minerals Management.

    For the reasons stated in the preamble, the BOEM amends title 30, 
chapter V, subchapter B, parts 550 and 553 of the Code of Federal 
Regulations as follows:

PART 550--OIL AND GAS AND SULFUR OPERATIONS IN THE OUTER 
CONTINENTAL SHELF

0
1. The authority citation for part 550 continues to read as follows:

    Authority: 30 U.S.C. 1751; 31 U.S.C. 9701; 43 U.S.C. 1334.


0
2. Revise Sec.  550.1403 to read as follows:


Sec.  550.1403  What is the maximum civil penalty?

    The maximum civil penalty is $44,675 per day per violation.

PART 553--OIL SPILL FINANCIAL RESPONSIBILITY FOR OFFSHORE 
FACILITIES

0
3. The authority citation for part 553 continues to read as follows:

    Authority: 33 U.S.C. 2704, 2716; E.O. 12777, as amended.


0
4. In Sec.  553.51, revise paragraph (a) to read as follows:


Sec.  553.51  What are the penalties for not complying with this part?

    (a) If you fail to comply with the financial responsibility 
requirements of OPA at 33 U.S.C. 2716 or with the requirements of this 
part, then you may be liable for a civil penalty of up to $47,357 per 
COF per day of violation (that is, each day a COF is operated without 
acceptable evidence of OSFR).
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[FR Doc. 2019-05577 Filed 3-25-19; 8:45 am]
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