[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]


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FEDERAL ELECTION COMMISSION

11 CFR Part 111

[NOTICE 2020-08]


Civil Monetary Penalties Annual Inflation Adjustments

AGENCY: Federal Election Commission.

ACTION: Final rule.

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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.
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    \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).
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    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\
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    \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.
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    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\
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    \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).
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    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\
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    \9\ Inflation Adjustment Act sec. 6.
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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\
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    \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.
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    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
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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).
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    \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).
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    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
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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