[Federal Register Volume 87, Number 76 (Wednesday, April 20, 2022)]
[Rules and Regulations]
[Pages 23450-23453]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2022-08222]


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DEPARTMENT OF EDUCATION

34 CFR Parts 36 and 668

RIN 1801-AA23


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. This adjustment is required by the Federal Civil 
Penalties Inflation Adjustment Act Improvements Act of 2015 (2015 Act), 
which amended the Federal Civil Penalties Inflation Adjustment Act of 
1990 (Inflation Adjustment Act). These final regulations provide the 
2022 annual inflation adjustments being made to the penalty amounts in 
the Department's final regulations published in the Federal Register on 
February 3, 2021 (2021 final rule).

DATES: These regulations are effective April 20, 2022. The adjusted 
CMPs established by these regulations are applicable only to civil 
penalties assessed after April 20, 2022 whose associated violations 
occurred after November 2, 2015.

FOR FURTHER INFORMATION CONTACT: Rhondalyn Primes Okoroma, U.S. 
Department of Education, Office of the General Counsel, 400 Maryland 
Avenue SW, Room 6C150, Washington, DC 20202-2241. Telephone: (202) 453-
6444. Email: [email protected].
    If you use a telecommunications device for the deaf (TDD) or a text 
telephone (TTY), call the Federal Relay Service, toll free, at 1-800-
877-8339.

SUPPLEMENTARY INFORMATION:

Background

    A CMP is defined in the Inflation Adjustment Act (28 U.S.C. 2461 
note) 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 Inflation Adjustment Act provides for the regular evaluation of 
CMPs to ensure that they continue to maintain their deterrent value. 
The Inflation Adjustment Act required that each agency issue 
regulations to adjust its CMPs beginning in 1996 and at least every 
four years thereafter. The Department published its most recent cost 
adjustment to its CMPs in the Federal Register on February 3, 2021 (86 
FR 7974), and those adjustments became effective on the date of 
publication.
    The 2015 Act (section 701 of Pub. L. 114-74) amended the Inflation 
Adjustment Act to improve the effectiveness of CMPs and to maintain 
their deterrent effect.
    The 2015 Act requires agencies to: (1) Adjust the level of CMPs 
with an initial ``catch-up'' adjustment through an interim final rule 
(IFR); and (2) make subsequent annual adjustments for inflation. Catch-
up adjustments are based on the percentage change between the Consumer 
Price Index for all Urban Consumers (CPI-U) for the month of October in 
the year the penalty was last adjusted by a statute other than the 
Inflation Adjustment Act, and the October 2015 CPI-U. Annual inflation 
adjustments are based on the percentage change between the October CPI-
U preceding the date of each statutory adjustment, and the prior year's 
October CPI-U.\1\ The Department published an IFR with the initial 
``catch-up'' penalty adjustment amounts on August 1, 2016 (81 FR 
50321).
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    \1\ If a statute that created a penalty is amended to change the 
penalty amount, the Department does not adjust the penalty in the 
year following the adjustment.
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    In these final regulations, based on the CPI-U for the month of 
October 2021, not seasonally adjusted, we are annually adjusting each 
CMP amount by a multiplier for 2022 of 1.06222, as directed by the 
Office of Management and Budget (OMB) Memorandum No. M-22-07 issued on 
December 15, 2021.

The Department's Civil Monetary Penalties

    The following analysis calculates new CMPs for penalty statutes in 
the order in which they appear in 34 CFR 36.2. The penalty amounts are 
being adjusted up based on the multiplier of 1.06222 provided in OMB 
Memorandum No. M-22-07.
    Statute: 20 U.S.C. 1015(c)(5).
    Current Regulations: The CMP for 20 U.S.C. 1015(c)(5) (Section 
131(c)(5) of the Higher Education Act of 1965, as amended (HEA)), as 
last set out in statute in 1998 (Pub. L. 105-244, title I, section 
101(a), October 7, 1998, 112 Stat. 1602), is 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. In the 2021 final rule, we increased this amount 
to $39,693.
    New Regulations: The new penalty for this section is $42,163.
    Reason: Using the multiplier of 1.06222 from OMB Memorandum No. M-
22-07, the new penalty is calculated as follows: $39,693 x 1.06222 = 
$42,162.69, which makes the adjusted penalty $42,163, when rounded to 
the nearest dollar.
    Statute: 20 U.S.C. 1022d(a)(3).
    Current Regulations: The CMP for 20 U.S.C. 1022d(a)(3) (Section 
205(a)(3) of the HEA), as last set out in statute in 2008 (Pub. L. 110-
315, title II, section 201(2), August 14, 2008, 122 Stat. 3147), is a 
fine of up to $27,500 for failure by an IHE to provide information to 
the State and the public regarding its

[[Page 23451]]

teacher-preparation programs. In the 2021 final rule, we increased this 
amount to $33,062.
    New Regulations: The new penalty for this section is $35,119.
    Reason: Using the multiplier of 1.06222 from OMB Memorandum No. M-
22-07, the new penalty is calculated as follows: $33,062 x 1.06222 = 
$35,119.11, which makes the adjusted penalty $35,119, when rounded to 
the nearest dollar.
    Statute: 20 U.S.C. 1082(g).
    Current Regulations: The CMP for 20 U.S.C. 1082(g) (Section 432(g) 
of the HEA), as last set out in statute in 1986 (Pub. L. 99-498, title 
IV, section 402(a), October 17, 1986, 100 Stat. 1401), is a fine of up 
to $25,000 for violations by lenders and guaranty agencies of Title IV 
of the HEA, which authorizes the Federal Family Education Loan Program. 
In the 2021 final rule, we increased this amount to $59,017.
    New Regulations: The new penalty for this section is $62,689.
    Reason: Using the multiplier of 1.06222 from OMB Memorandum No. M-
22-07, the new penalty is calculated as follows: $59,017 x 1.06222 = 
$62,689.03, which makes the adjusted penalty $62,689, when rounded to 
the nearest dollar.
    Statute: 20 U.S.C. 1094(c)(3)(B).
    Current Regulations: The CMP for 20 U.S.C. 1094(c)(3)(B) (Section 
487(c)(3)(B) of the HEA), as set out in statute in 1986 (Pub. L. 99-
498, title IV, section 407(a), October 17, 1986, 100 Stat. 1488), is a 
fine of up to $25,000 for an IHE's violation of Title IV of the HEA or 
its implementing regulations. Title IV authorizes various programs of 
student financial assistance. In the 2021 final rule, we increased this 
amount to $59,017.
    New Regulations: The new penalty for this section is $62,689.
    Reason: Using the multiplier of 1.06222 from OMB Memorandum No. M-
22-07, the new penalty is calculated as follows: $59,017 x 1.06222 = 
$62,689.03, which makes the adjusted penalty $62,689, when rounded to 
the nearest dollar.
    Statute: 20 U.S.C. 1228c(c)(2)(E).
    Current Regulations: The CMP for 20 U.S.C. 1228c(c)(2)(E) (Section 
429 of the General Education Provisions Act), as set out in statute in 
1994 (Pub. L. 103-382, title II, section 238, October 20, 1994, 108 
Stat. 3918), is a fine of up to $1,000 for an educational 
organization's failure to disclose certain information to minor 
students and their parents. In the 2021 final rule, we increased this 
amount to $1,742.
    New Regulations: The new penalty for this section is $1,850.
    Reason: Using the multiplier of 1.06222 from OMB Memorandum No. M-
22-07, the new penalty is calculated as follows: $1,742 x 1.06222 = 
$1,850.38, which makes the adjusted penalty $1,850, when rounded to the 
nearest dollar.
    Statute: 31 U.S.C. 1352(c)(1) and (c)(2)(A).
    Current Regulations: The CMPs for 31 U.S.C. 1352(c)(1) and 
(c)(2)(A), as set out in statute in 1989 (Pub. L. 101-121, title III, 
section 319(a)(1), October 23, 1989, 103 Stat. 750), are a fine of 
$10,000 to $100,000 for recipients of Government grants, contracts, 
etc. that improperly lobby Congress or the Executive Branch with 
respect to the award of Government grants and contracts. In the 2021 
final rule, we increased these amounts to $20,731 to $207,314.
    New Regulations: The new penalties for these sections are $22,021 
to $220,213.
    Reason: Using the multiplier of 1.06222 from OMB Memorandum No. M-
22-07, the new minimum penalty is calculated as follows: $20,731 x 
1.06222 = $22,020.88, which makes the adjusted penalty $22,021, when 
rounded to the nearest dollar. The new maximum penalty is calculated as 
follows: $207,314 x 1.06222 = $220,213.07, which makes the adjusted 
penalty $220,213, when rounded to the nearest dollar.
    Statute: 31 U.S.C. 3802(a)(1) and (a)(2).
    Current Regulations: The CMPs for 31 U.S.C. 3802(a)(1) and (a)(2), 
as set out in statute in 1986 (Pub. L. 99-509, title VI, section 
6103(a), Oct. 21, 1986, 100 Stat. 1937), are a fine of up to $5,000 for 
false claims and statements made to the Government. In the 2021 final 
rule, we increased this amount to $11,803.
    New Regulations: The new penalty for this section is $12,537.
    Reason: Using the multiplier of 1.06222 from OMB Memorandum No. M-
22-07, the new penalty is calculated as follows: $11,803 x 1.06222 = 
$12,537.38, which makes the adjusted penalty $12,537 when rounded to 
the nearest dollar.

Executive Orders 12866 and 13563

Regulatory Impact Analysis

    Under Executive Order 12866, it must be determined whether this 
regulatory action is ``significant'' and, therefore, subject to the 
requirements of the Executive order and subject to review by the Office 
of Management and Budget (OMB). Section 3(f) of Executive Order 12866 
defines a ``significant regulatory action'' as an action likely to 
result in a rule that may--
    (1) Have an annual effect on the economy of $100 million or more, 
or adversely affect a sector of the economy, productivity, competition, 
jobs, the environment, public health or safety, or State, local, or 
Tribal governments or communities in a material way (also referred to 
as ``economically significant'' rule);
    (2) Create serious inconsistency or otherwise interfere with an 
action taken or planned by another agency;
    (3) Materially alter the budgetary impacts of entitlement grants, 
user fees, or loan programs or the rights and obligations of recipients 
thereof; or
    (4) Raise novel legal or policy issues arising out of legal 
mandates, the President's priorities, or the principles stated in the 
Executive order.
    We have determined that these final regulations: (1) Exclusively 
implement the annual adjustment; (2) are consistent with OMB Memorandum 
No. M-22-07; and (3) have an annual impact of less than $100 million. 
Therefore, based on OMB Memorandum No. M-22-07, this is not a 
significant regulatory action subject to review by OMB under section 
3(f) of Executive Order 12866.
    We have also reviewed these regulations under Executive Order 
13563, which supplements and explicitly reaffirms the principles, 
structures, and definitions governing regulatory review established in 
Executive Order 12866. To the extent permitted by law, Executive Order 
13563 requires that an agency--
    (1) Propose or adopt regulations only upon a reasoned determination 
that their benefits justify their costs (recognizing that some benefits 
and costs are difficult to quantify);
    (2) Tailor its regulations to impose the least burden on society, 
consistent with obtaining regulatory objectives and taking into 
account, among other things, and to the extent practicable, the costs 
of cumulative regulations;
    (3) In choosing among alternative regulatory approaches, select 
those approaches that maximize net benefits (including potential 
economic, environmental, public health and safety, and other 
advantages; distributive impacts; and equity);
    (4) To the extent feasible, specify performance objectives, rather 
than the behavior or manner of compliance a regulated entity must 
adopt; and
    (5) Identify and assess available alternatives to direct 
regulation, including economic incentives--such as user fees or 
marketable permits--to encourage the desired behavior, or providing 
information that enables the public to make choices.

[[Page 23452]]

    Executive Order 13563 also requires an agency ``to use the best 
available techniques to quantify anticipated present and future 
benefits and costs as accurately as possible.'' The Office of 
Information and Regulatory Affairs of OMB has emphasized that these 
techniques may include ``identifying changing future compliance costs 
that might result from technological innovation or anticipated 
behavioral changes.''
    We are issuing these final regulations as required by statute and 
in accordance with OMB Memorandum No. M-22-07. The Secretary has no 
discretion to consider alternative approaches as delineated in the 
Executive order. Based on this analysis and the reasons stated in the 
preamble, the Department believes that these final regulations are 
consistent with the principles in Executive Order 13563.

Waiver of Rulemaking and Delayed Effective Date

    Under the Administrative Procedure Act (APA) (5 U.S.C. 553), the 
Department generally offers interested parties the opportunity to 
comment on proposed regulations. However, section 4(b)(2) of the 2015 
Act (28 U.S.C. 2461 note) provides that the Secretary can adjust these 
2022 penalty amounts notwithstanding the requirements of 5 U.S.C. 553. 
Therefore, the requirements of 5 U.S.C. 553 for notice and comment and 
delaying the effective date of a final rule do not apply here.

Regulatory Flexibility Act Certification

    Pursuant to 5 U.S.C. 601(2), the Regulatory Flexibility Act applies 
only to rules for which an agency publishes a general notice of 
proposed rulemaking. The Regulatory Flexibility Act does not apply to 
this rulemaking because section 4(b)(2) of the 2015 Act (28 U.S.C. 2461 
note) provides that the Secretary can adjust these 2021 penalty amounts 
without publishing a general notice of proposed rulemaking.

Paperwork Reduction Act of 1995

    These regulations do not contain any information collection 
requirements.

Intergovernmental Review

    This program is not subject to Executive Order 12372 and the 
regulations in 34 CFR part 79.

Assessment of Educational Impact

    Based on our own review, we have determined that these regulations 
do not require transmission of information that any other agency or 
authority of the United States gathers or makes available.
    Accessible Format: On request to the program contact person listed 
under FOR FURTHER INFORMATION CONTACT, individuals with disabilities 
can obtain this document in an accessible format. The Department will 
provide the requestor with an accessible format that may include Rich 
Text Format (RTF) or text format (txt), a thumb drive, an MP3 file, 
braille, large print, audiotape, or compact disc, or other accessible 
format.
    Electronic Access to This Document: The official version of this 
document is the document published in the Federal Register. You may 
access the official edition of the Federal Register and the Code of 
Federal Regulations at www.govinfo.gov. At this site you can view this 
document, as well as all other documents of this Department published 
in the Federal Register, in text or Portable Document Format (PDF). To 
use PDF you must have Adobe Acrobat Reader, which is available free at 
the site.
    You may also access documents of the Department published in the 
Federal Register by using the article search feature at 
www.federalregister.gov. Specifically, through the advanced search 
feature at this site, you can limit your search to documents published 
by the Department.

List of Subjects

34 CFR Part 36

    Claims, Fraud, Penalties.

34 CFR Part 668

    Administrative practice and procedure, Aliens, Colleges and 
universities, Consumer protection, Grant programs-education, Loan 
programs-education, Reporting and recordkeeping requirements, Selective 
Service System, Student aid, Vocational education.

Miguel A. Cardona,
Secretary of Education.

    For the reasons discussed in the preamble, the Secretary amends 
parts 36 and 668 of 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: 20 U.S.C. 1221e-3 and 3474; 28 U.S.C. 2461 note, as 
amended by section 701 of Pub. Law 114-74, unless otherwise noted.


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


Sec.  36.2  Penalty adjustment.

* * * * *

   Table I--Sec.   36.2.--Civil Monetary Penalty Inflation Adjustments
------------------------------------------------------------------------
                                                            New maximum
                                                           (and minimum,
            Statute                    Description        if applicable)
                                                          penalty amount
------------------------------------------------------------------------
20 U.S.C. 1015(c)(5) (Section    Provides for a fine, as         $42,163
 131(c)(5) of the Higher          set by Congress in
 Education Act of 1965 (HEA)).    1998, 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.
20 U.S.C. 1022d(a)(3) (Section   Provides for a fine, as          35,119
 205(a)(3) of the HEA).           set by Congress in
                                  2008, of up to $27,500
                                  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) (Section       Provides for a civil             62,689
 432(g) of the HEA).              penalty, as set by
                                  Congress in 1986, of
                                  up to $25,000 for
                                  violations by lenders
                                  and guaranty agencies
                                  of Title IV of the
                                  HEA, which authorizes
                                  the Federal Family
                                  Education Loan Program.
20 U.S.C. 1094(c)(3)(B)          Provides for a civil             62,689
 (Section 487(c)(3)(B) of the     penalty, as set by
 HEA).                            Congress in 1986, of
                                  up to $25,000 for an
                                  IHE's violation of
                                  Title IV of the HEA,
                                  which authorizes
                                  various programs of
                                  student financial
                                  assistance.
20 U.S.C. 1228c(c)(2)(E)         Provides for a civil              1,850
 (Section 429 of the General      penalty, as set by
 Education Provisions Act).       Congress in 1994, of
                                  up to $1,000 for an
                                  educational
                                  organization's failure
                                  to disclose certain
                                  information to minor
                                  students and their
                                  parents.

[[Page 23453]]

 
31 U.S.C. 1352(c)(1) and         Provides for a civil          22,021 to
 (c)(2)(A).                       penalty, as set by             220,213
                                  Congress in 1989, of
                                  $10,000 to $100,000
                                  for recipients of
                                  Government grants,
                                  contracts, etc. that
                                  improperly 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             12,537
                                  penalty, as set by
                                  Congress in 1986, of
                                  up to $5,000 for false
                                  claims and statements
                                  made to the Government.
------------------------------------------------------------------------

* * * * *

PART 668--STUDENT ASSISTANCE GENERAL PROVISIONS

0
3. The general authority citation for part 668 continues to read as 
follows:

    Authority: 20 U.S.C. 1001-1003, 1070a, 1070g, 1085, 1087b, 
1087d, 1087e, 1088, 1091, 1092, 1094, 1099c, 1099c-1, 1221e-3, and 
3474; Pub. L. 111-256, 124 Stat. 2643; unless otherwise noted.
* * * * *


Sec.  668.84  [Amended]

0
4. In Sec.  668.84 amend paragraph (a)(1) introductory text by removing 
the number ``$59,017'' and adding, in its place, the number 
``$62,689''.

[FR Doc. 2022-08222 Filed 4-19-22; 8:45 am]
BILLING CODE 4000-01-P