[Federal Register Volume 86, Number 6 (Monday, January 11, 2021)]
[Rules and Regulations]
[Pages 1737-1740]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-29184]
=======================================================================
-----------------------------------------------------------------------
FEDERAL ELECTION COMMISSION
11 CFR Part 111
[NOTICE 2020-08]
Civil Monetary Penalties Annual Inflation Adjustments
AGENCY: Federal Election Commission.
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: As required by the Federal Civil Penalties Inflation
Adjustment Act of 1990, the Federal Election Commission is adjusting
for inflation the civil monetary penalties established under the
Federal Election Campaign Act, the Presidential Election Campaign Fund
Act, and the Presidential Primary Matching Payment Account Act. The
civil monetary penalties being adjusted are those negotiated by the
Commission or imposed by a court for certain statutory violations, and
those imposed by the Commission for late filing of, or failure to file,
certain reports required by the Federal Election Campaign Act. The
adjusted civil monetary penalties are calculated according to a
statutory formula and the adjusted amounts will apply to penalties
assessed after the effective date of these rules.
DATES: The final rules are effective on January 11, 2021.
FOR FURTHER INFORMATION CONTACT: Mr. Robert M. Knop, Assistant General
Counsel, Mr. Joseph P. Wenzinger, Attorney, or Ms. Terrell D.
Stansbury, Paralegal, Office of General Counsel, (202) 694-1650 or
(800) 424-9530.
SUPPLEMENTARY INFORMATION: The Federal Civil Penalties Inflation
Adjustment Act of 1990 (the ``Inflation Adjustment Act''),\1\ as
amended by the Federal Civil Penalties Inflation Adjustment Act
Improvements Act of 2015 (the ``2015 Act''),\2\ requires Federal
agencies, including the Commission, to adjust for inflation the civil
monetary penalties within their jurisdiction according to prescribed
formulas. A civil monetary penalty is ``any penalty, fine, or other
sanction'' that (1) ``is for a specific monetary amount'' or ``has a
maximum amount'' under Federal law; and (2) that a Federal agency
assesses or enforces ``pursuant to an administrative proceeding or a
civil action'' in Federal court.\3\ Under the Federal Election Campaign
Act, 52 U.S.C. 30101-45 (``FECA''), the Commission may seek and assess
civil monetary penalties for violations of FECA, the Presidential
Election Campaign Fund Act, 26 U.S.C. 9001-13, and the Presidential
Primary Matching Payment Account Act, 26 U.S.C. 9031-42.
---------------------------------------------------------------------------
\1\ Public Law 101-410, 104 Stat. 890 (codified at 28 U.S.C.
2461 note), amended by Debt Collection Improvement Act of 1996,
Public Law 104-134, sec. 31001(s)(1), 110 Stat. 1321, 1321-373;
Federal Reports Elimination Act of 1998, Public Law 105-362, sec.
1301, 112 Stat. 3280.
\2\ Public Law 114-74, sec. 701, 129 Stat. 584, 599.
\3\ Inflation Adjustment Act sec. 3(2).
---------------------------------------------------------------------------
The Inflation Adjustment Act requires Federal agencies to adjust
their civil penalties annually, and the adjustments must take effect no
later than January 15 of every year.\4\ Pursuant to guidance issued by
the Office of Management and Budget,\5\ the Commission is now adjusting
its civil monetary penalties for 2021.\6\
---------------------------------------------------------------------------
\4\ Inflation Adjustment Act sec. 4(a).
\5\ See Inflation Adjustment Act sec. 7(a) (requiring OMB to
``issue guidance to agencies on implementing the inflation
adjustments required under this Act''); see also Memorandum from
Russell T. Vought, Director, Office of Management and Budget, to
Heads of Executive Departments and Agencies, M-21-10, Dec. 23, 2020,
https://www.whitehouse.gov/wp-content/uploads/2020/12/M-21-10.pdf
(``OMB Memorandum'').
\6\ Inflation Adjustment Act sec. 5.
---------------------------------------------------------------------------
The Commission must adjust for inflation its civil monetary
penalties ``notwithstanding Section 553'' of the Administrative
Procedure Act (``APA'').\7\ Thus, the APA's notice-and-comment and
delayed effective date requirements in 5 U.S.C. 553(b)-(d) do
[[Page 1738]]
not apply because Congress has specifically exempted agencies from
these requirements.\8\
---------------------------------------------------------------------------
\7\ Inflation Adjustment Act sec. 4(b)(2).
\8\ See, e.g., Asiana Airlines v. FAA, 134 F.3d 393, 396-99
(D.C. Cir. 1998) (finding APA ``notice and comment'' requirement not
applicable where Congress clearly expressed intent to depart from
normal APA procedures).
---------------------------------------------------------------------------
Furthermore, because the inflation adjustments made through these
final rules are required by Congress and involve no Commission
discretion or policy judgments, these rules do not need to be submitted
to the Speaker of the United States House of Representatives or the
President of the United States Senate under the Congressional Review
Act, 5 U.S.C. 801 et seq. Moreover, because the APA's notice-and-
comment procedures do not apply to these final rules, the Commission is
not required to conduct a regulatory flexibility analysis under 5
U.S.C. 603 or 604. See 5 U.S.C. 601(2), 604(a). Nor is the Commission
required to submit these revisions for congressional review under FECA.
See 5 U.S.C. 30111(d)(1), (4) (providing for congressional review when
the Commission ``prescribe[s]'' a ``rule of law'').
The new penalty amounts will apply to civil monetary penalties that
are assessed after the date the increase takes effect, even if the
associated violation predated the increase.\9\
---------------------------------------------------------------------------
\9\ Inflation Adjustment Act sec. 6.
---------------------------------------------------------------------------
Explanation and Justification
The Inflation Adjustment Act requires the Commission to annually
adjust its civil monetary penalties for inflation by applying a cost-
of-living-adjustment (``COLA'') ratio.\10\ The COLA ratio is the
percentage that the Consumer Price Index (``CPI'') \11\ ``for the month
of October preceding the date of the adjustment'' exceeds the CPI for
October of the previous year.\12\ To calculate the adjusted penalty,
the Commission must increase the most recent civil monetary penalty
amount by the COLA ratio.\13\ According to the Office of Management and
Budget, the COLA ratio for 2021 is 0.01182, or 1.182%; thus, to
calculate the new penalties, the Commission must multiply the most
recent civil monetary penalties in force by 1.01182.\14\
---------------------------------------------------------------------------
\10\ The COLA ratio must be applied to the most recent civil
monetary penalties. Inflation Adjustment Act, sec. 4(a); see also
OMB Memorandum at 2.
\11\ The Inflation Adjustment Act, sec. 3, uses the CPI ``for
all-urban consumers published by the Department of Labor.''
\12\ Inflation Adjustment Act, sec. 5(b)(1).
\13\ Inflation Adjustment Act, sec. 5(a), (b)(1).
\14\ OMB Memorandum at 1.
---------------------------------------------------------------------------
The Commission assesses two types of civil monetary penalties that
must be adjusted for inflation. First are penalties that are either
negotiated by the Commission or imposed by a court for violations of
FECA, the Presidential Election Campaign Fund Act, or the Presidential
Primary Matching Payment Account Act. These civil monetary penalties
are set forth at 11 CFR 111.24. Second are the civil monetary penalties
assessed through the Commission's Administrative Fines Program for late
filing or non-filing of certain reports required by FECA. See 52 U.S.C.
30109(a)(4)(C) (authorizing Administrative Fines Program), and 30104(a)
(requiring political committee treasurers to report receipts and
disbursements within certain time periods). The penalty schedules for
these civil monetary penalties are set out at 11 CFR 111.43 and 111.44.
1. 11 CFR 111.24--Civil Penalties
FECA establishes the civil monetary penalties for violations of
FECA and the other statutes within the Commission's jurisdiction. See
52 U.S.C. 30109(a)(5), (6), (12). Commission regulations in 11 CFR
111.24 provide the current inflation-adjusted amount for each such
civil monetary penalty. To calculate the adjusted civil monetary
penalty, the Commission multiplies the most recent penalty amount by
the COLA ratio and rounds that figure to the nearest dollar.
The actual adjustment to each civil monetary penalty is shown in
the chart below.
----------------------------------------------------------------------------------------------------------------
Most recent New civil
Section civil penalty COLA penalty
----------------------------------------------------------------------------------------------------------------
11 CFR 111.24(a)(1)............................................. $20,288 1.01182 $20,528
11 CFR 111.24(a)(2)(i).......................................... 43,280 1.01182 43,792
11 CFR 111.24(a)(2)(ii)......................................... 70,973 1.01182 71,812
11 CFR 111.24(b)................................................ 6,069 1.01182 6,141
11 CFR 111.24(b)................................................ 15,173 1.01182 15,352
----------------------------------------------------------------------------------------------------------------
2. 11 CFR 111.43, 111.44--Administrative Fines
FECA authorizes the Commission to assess civil monetary penalties
for violations of the reporting requirements of 52 U.S.C. 30104(a)
according to the penalty schedules ``established and published by the
Commission.'' 52 U.S.C. 30109(a)(4)(C)(i). The Commission has
established two penalty schedules: The penalty schedule in 11 CFR
111.43(a) applies to reports that are not election sensitive, and the
penalty schedule in 11 CFR 111.43(b) applies to reports that are
election sensitive.\15\ Each penalty schedule contains two columns of
penalties, one for late-filed reports and one for non-filed reports,
with penalties based on the level of financial activity in the report
and, if late-filed, its lateness.\16\ In addition, 11 CFR 111.43(c)
establishes a civil monetary penalty for situations in which a
committee fails to file a report and the Commission cannot calculate
the relevant level of activity. Finally, 11 CFR 111.44 establishes a
civil monetary penalty for failure to file timely reports of
contributions received less than 20 days, but more than 48 hours,
before an election. See 52 U.S.C. 30104(a)(6).
---------------------------------------------------------------------------
\15\ Election sensitive reports are certain reports due shortly
before an election. See 11 CFR 111.43(d)(1).
\16\ A report is considered to be ``not filed'' if it is never
filed or is filed more than a certain number of days after its due
date. See 11 CFR 111.43(e).
---------------------------------------------------------------------------
To determine the adjusted civil monetary penalty amount for each
level of activity, the Commission multiplies the most recent penalty
amount by the COLA ratio and rounds that figure to the nearest dollar.
The new civil monetary penalties are shown in the schedules in the rule
text, below.
List of Subjects in 11 CFR Part 111
Administrative practice and procedure, Elections, Law enforcement,
Penalties.
For the reasons set out in the preamble, the Federal Election
Commission amends subchapter A of chapter I of title 11 of the Code of
Federal Regulations as follows:
PART 111--COMPLIANCE PROCEDURE (52 U.S.C. 30109, 30107(a))
0
1. The authority citation for part 111 continues to read as follows:
[[Page 1739]]
Authority: 52 U.S.C. 30102(i), 30109, 30107(a), 30111(a)(8); 28
U.S.C. 2461 note; 31 U.S.C. 3701, 3711, 3716-3719, and 3720A, as
amended; 31 CFR parts 285 and 900-904.
Sec. 111.24 [Amended]
0
2. Section 111.24 is amended in the table below by, for each section
indicated in the left column, removing the number indicated in the
middle column, and adding in its place the number indicated in the
right column as follows:
------------------------------------------------------------------------
Section Remove Add
------------------------------------------------------------------------
111.24(a)(1)............................ $20,288 $20,528
111.24(a)(2)(i)......................... 43,280 43,792
111.24(a)(2)(ii)........................ 70,973 71,812
111.24(b)............................... 6,069 6,141
111.24(b)............................... 15,173 15,352
------------------------------------------------------------------------
0
3. Section 111.43 is amended by revising paragraphs (a), (b), and (c)
to read as follows:
Sec. 111.43 What are the schedules of penalties?
(a) The civil money penalty for all reports that are filed late or
not filed, except election sensitive reports and pre-election reports
under 11 CFR 104.5, shall be calculated in accordance with the
following schedule of penalties:
Table 1 to Paragraph (a)
------------------------------------------------------------------------
And the report was
If the level of activity in filed late, the Or the report was
the report was: civil money penalty not filed, the civil
is: money penalty is:
------------------------------------------------------------------------
$1-4,999.99 \1\............. [$36 + ($6 x Number $351 x [1 + (.25 x
of days late)] x [1 Number of previous
+ (.25 x Number of violations)].
previous
violations)].
$5,000-9,999.99............. [$70 + ($6 x Number $422 x [1 + (.25 x
of days late)] x [1 Number of previous
+ (.25 x Number of violations)]
previous
violations)].
$10,000-24,999.99........... [$151 + ($6 x Number $704 x [1 + (.25 x
of days late)] x [1 Number of previous
+ (.25 x Number of violations)].
previous
violations)].
$25,000-49,999.99........... [$298 + ($28 x $1267 x [1 + (.25 x
Number of days Number of previous
late)] x [1 + (.25 violations)].
x Number of
previous
violations)].
$50,000-74,999.99........... [$450 + ($113 x $4041 x [1 + (.25 x
Number of days Number of previous
late)] x [1 + (.25 violations)].
x Number of
previous
violations)].
$75,000-99,999.99........... [$598 + ($151 x $5237 x [1 + (.25 x
Number of days Number of previous
late)] x [1 + (.25 violations)].
x Number of
previous
violations)].
$100,000-149,999.99......... [$896 + ($187 x $6735 x [1 + (.25 x
Number of days Number of previous
late)] x [1 + (.25 violations)].
x Number of
previous
violations)].
$150,000-199,999.99......... [$1199 + ($224 x $8231 x [1 + (.25 x
Number of days Number of previous
late)] x [1 + (.25 violations)].
x Number of
previous
violations)].
$200,000-249,999.99......... [$1496 + ($261 x $9727 x [1 + (.25 x
Number of days Number of previous
late)] x [1 + (.25 violations)].
x Number of
previous
violations)].
$250,000-349,999.99......... [$2245 + ($298 x $11,972 x [1 + (.25
Number of days x Number of
late)] x [1 + (.25 previous
x Number of violations)].
previous
violations)].
$350,000-449,999.99......... [$2994 + ($298 x $13,468 x [1 + (.25
Number of days x Number of
late)] x [1 + (.25 previous
x Number of violations)].
previous
violations)].
$450,000-549,999.99......... [$3741 + ($298 x $14,216 x [1 + (.25
Number of days x Number of
late)] x [1 + (.25 previous
x Number of violations)].
previous
violations)].
$550,000-649,999.99......... [$4489 + ($298 x $14,966 x [1 + (.25
Number of days x Number of
late)] x [1 + (.25 previous
x Number of violations)].
previous
violations)].
$650,000-749,999.99......... [$5237 + ($298 x $15,713 x [1 + (.25
Number of days x Number of
late)] x [1 + (.25 previous
x Number of violations)].
previous
violations)].
$750,000-849,999.99......... [$5986 + ($298 x $16,461 x [1 + (.25
Number of days x Number of
late)] x [1 + (.25 previous
x Number of violations)].
previous
violations)].
$850,000-949,999.99......... [$6735 + ($298 x $17,209 x [1 + (.25
Number of days x Number of
late)] x [1 + (.25 previous
x Number of violations)]
previous
violations)].
$950,000 or over............ [$7482 + ($298 x $17,958 x [1 + (.25
Number of days x Number of
late)] x [1 + (.25 previous
x Number of violations)].
previous
violations)].
------------------------------------------------------------------------
\1\The civil money penalty for a respondent who does not have any
previous violations will not exceed the level of activity in the
report.
(b) The civil money penalty for election sensitive reports that are
filed late or not filed shall be calculated in accordance with the
following schedule of penalties:
Table 2 to Paragraph (b)
------------------------------------------------------------------------
And the report was
If the level of activity in filed late, the Or the report was
the report was: civil money penalty not filed, the civil
is: money penalty is:
------------------------------------------------------------------------
$1-$4,999.99 \1\............ [$70 + ($13 x Number $704 x [1 + (.25 x
of days late)] x [1 Number of previous
+ (.25 x Number of violations)].
previous
violations)].
[[Page 1740]]
$5,000-$9,999.99............ [$141 + ($13 x $844 x [1 + (.25 x
Number of days Number of previous
late)] x [1 + (.25 violations)].
x Number of
previous
violations)].
$10,000-24,999.99........... [$211 + ($13 x $1267 x [1 + (.25 x
Number of days Number of previous
late)] x [1 + (.25 violations)].
x Number of
previous
violations)].
$25,000-49,999.99........... [$450 + ($36 x $1970 x [1 + (.25 x
Number of days Number of previous
late)] x [1 + (.25 violations)].
x Number of
previous
violations)].
$50,000-74,999.99........... [$674 + ($113 x $4489 x [1 + (.25 x
Number of days Number of previous
late)] x [1 + (.25 violations)].
x Number of
previous
violations)].
$75,000-99,999.99........... [$896 + ($151 x $5986 x [1 + (.25 x
Number of days Number of previous
late)] x [1 + (.25 violations)].
x Number of
previous
violations)].
$100,000-149,999.99......... [$1347 + ($187 x $7482 x [1 + (.25 x
Number of days Number of previous
late)] x [1 + (.25 violations)].
x Number of
previous
violations)].
$150,000-199,999.99......... [$1796 + ($224 x $8978 x [1 + (.25 x
Number of days Number of previous
late)] x [1 + (.25 violations)].
x Number of
previous
violations)].
$200,000-249,999.99......... [$2245 + ($261 x $11,224 x [1 + (.25
Number of days x Number of
late)] x [1 + (.25 previous
x Number of violations)].
previous
violations)].
$250,000-349,999.99......... [$3367 + ($298 x $13,468 x [1 + (.25
Number of days x Number of
late)] x [1 + (.25 previous
x Number of violations)].
previous
violations)].
$350,000-449,999.99......... [$4489 + ($298 x $14,966 x [1 + (.25
Number of days x Number of
late)] x [1 + (.25 previous
x Number of violations)].
previous
violations)].
$450,000-549,999.99......... [$5612 + ($298 x $16,461 x [1 + (.25
Number of days x Number of
late)] x [1 + (.25 previous
x Number of violations)].
previous
violations)].
$550,000-649,999.99......... [$6735 + ($298 x $17,958 x [1 + (.25
Number of days x Number of
late)] x [1 + (.25 previous
x Number of violations)].
previous
violations)].
$650,000-749,999.99......... [$7857 + ($298 x $19,455 x [1 + (.25
Number of days x Number of
late)] x [1 + (.25 previous
x Number of violations)].
previous
violations)].
$750,000-849,999.99......... [$8978 + ($298 x $20,951 x [1 + (.25
Number of days x Number of
late)] x [1 + (.25 previous
x Number of violations)].
previous
violations)].
$850,000-949,999.99......... [$10,101 + ($298 x $22,446 x [1 + (.25
Number of days x Number of
late)] x [1 + (.25 previous
x Number of violations)].
previous
violations)].
$950,000 or over............ [$11,224 + ($298 x $23,944 x [1 + (.25
Number of days x Number of
late)] x [1 + (.25 previous
x Number of violations)].
previous
violations)].
------------------------------------------------------------------------
\1\ The civil money penalty for a respondent who does not have any
previous violations will not exceed the level of activity in the
report.
(c) If the respondent fails to file a required report and the
Commission cannot calculate the level of activity under paragraph (d)
of this section, then the civil money penalty shall be $8,231.
* * * * *
Sec. 111.44 [Amended]
0
4. Amend Sec. 111.44(a)(1) by removing ``$149'' and adding in its
place ``$151''.
Dated: December 30, 2020.
On behalf of the Commission.
Ellen L. Weintraub,
Commissioner, Federal Election Commission.
[FR Doc. 2020-29184 Filed 1-8-21; 8:45 am]
BILLING CODE 6715-01-P