Civil Monetary Penalties-Adjustments for Inflation

AGENCY:

Coast Guard, DHS.

ACTION:

Final rule.

SUMMARY:

The Coast Guard is adjusting fines and other civil monetary penalties to reflect the impact of inflation. These adjustments are made in accordance with the Federal Civil Penalties Inflation Adjustment Act of 1990, as amended by the Debt Collection Improvement Act of 1996.

DATES:

This final rule is effective January 22, 2004.

ADDRESSES:

Material received from the public, as well as documents mentioned in this preamble as being available in the docket, are part of docket USCG-2003-15486 and are available for inspection or copying at the Docket Management Facility, U.S. Department of Transportation, room PL-401, 400 Seventh Street, SW., Washington, DC, between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. You may also find this docket on the Internet at http://dms.dot.gov.

FOR FURTHER INFORMATION CONTACT:

If you have questions on this rule, call Mr. Robert Spears of the Office of Standards Evaluation and Development, Coast Guard, telephone 202-267-1099 or 202-267-6826. If you have questions on viewing the docket, call Andrea M. Jenkins, Program Manager, Docket Operations, Department of Transportation, telephone 202-366-0271.

SUPPLEMENTARY INFORMATION:

Background and Purpose

Many fines or other civil monetary penalties (CMPs) for violating Federal laws and regulations were set by Congress long ago, and their deterrent value has weakened with time due to inflation. Congress recognizes this problem and has devised a mechanism to address it. It provides mandatory inflation adjustment formulas and requires Federal agencies to adjust their CMPs using those formulas at least once every four years, making further direct involvement by Congress unnecessary. This mechanism derives from the Federal Civil Penalties Inflation Adjustment Act of 1990, Pub. L. 101-410, 104 Stat. 890, §§ 1-6, as amended by the Debt Collection Improvement Act of 1996, Pub. L. 104-134, 110 Stat. 1321, § 31001(s)(1); see 28 U.S.C. 2461 note (collectively, “the statute”).

The Coast Guard is amending 33 CFR 27.3 to update CMP adjustments first made in 1997. We expect to repeat the adjustment process in 2007 and quadrennially thereafter. We are also making two non-substantive changes, amending 33 CFR 27.1 to make the legislative authority for CMP adjustments clearer, and removing 33 CFR 27.2 which applied specifically to the 1997 adjustments and is no longer necessary.

Regulatory Procedure

This final rule is published without prior notice of proposed rulemaking or public comment. Pursuant to the Administrative Procedure Act, 5 U.S.C. 553(b)(3)(B), the Coast Guard finds that good cause exists for dispensing with notice and comment in this rulemaking. This rulemaking implements the Federal Civil Penalties Inflation Adjustment Act of 1990, as amended by the Debt Collection Improvement Act of 1996, and with the exception of the non-substantive changes described above, that legislation mandates all our actions and allows us no discretion in implementation, so that prior notice and comment is unnecessary and contrary to the public interest.

Method of Calculation

The statute (see “Background and Purpose”) requires inflation adjustments to be based on changes in the Consumer Price Index (CPI) from June of the calendar year in which the penalties were last set or adjusted, through June of the year prior to the adjustment. The statute also includes precise rules for rounding penalty increases. It limits the first adjustments of an agency's penalties to 10 percent of the penalty amounts. Our method of calculation takes into account the General Accounting Office (GAO) report “United States Coast Guard Implementation of the Inflation Adjustment Act,” (GAO-03-221R, Nov. 1, 2002) and subsequent discussions with the GAO. Table A below sets forth each CMP provision which is being increased in 2003 and shows the intermediate calculations performed to arrive at the adjusted final maximum penalty contained in the last column.

Regulatory Evaluation

This rule is not a “significant regulatory action” under section 3(f) of Executive Order 12866, Regulatory Planning and Review, and does not require an assessment of potential costs and benefits under section 6(a)(3) of that Order. The Office of Management and Budget has not reviewed it under that Order. It is not “significant” under the regulatory policies and procedures of the Department of Homeland Security (DHS).

We expect the economic impact of this rule to be so minimal that a full Regulatory Evaluation under the regulatory policies and procedures of DHS is unnecessary. This rule concerns civil monetary penalties imposed for violating Federal law and regulations. It has no impact on law-abiding persons.

Small Entities

Under the Regulatory Flexibility Act (5 U.S.C. 601-612), we have considered whether this rule would have a significant economic impact on a substantial number of small entities. The term “small entities” comprises small businesses, not-for-profit organizations that are independently owned and operated and are not dominant in their fields, and governmental jurisdictions with populations of less than 50,000. This rule concerns civil monetary penalties imposed for violating Federal law and regulations. It has no impact on law-abiding persons.

Therefore, the Coast Guard certifies under 5 U.S.C. 605(b) that this final rule will not have a significant economic impact on a substantial number of small entities.

Assistance for Small Entities

In accordance with section 213(a) of the Small Business Regulatory Enforcement Fairness Act of 1996 (Pub. L. 104-121), we will assist small entities in understanding this rule. If you are a small entity and the Coast Guard has assessed a civil monetary penalty against you, let your hearing officer know if you need help understanding the provisions of this rule or how it applies to you.

Small businesses may send comments on the actions of Federal employees who enforce, or otherwise determine compliance with, Federal regulations to the Small Business and Agriculture Regulatory Enforcement Ombudsman and the Regional Small Business Regulatory Fairness Boards. The Ombudsman evaluates these actions annually and rates each agency's responsiveness to small business. If you wish to comment on actions by employees of the Coast Guard, call 1-888-REG-FAIR (1-888-734-3247).

Collection of Information

This rule calls for no new collection of information under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520).

Federalism

A rule has implications for federalism under Executive Order 13132, Federalism, if it has a substantial direct effect on State or local governments and would either preempt State law or impose a substantial direct cost of compliance on them. We have analyzed this rule under that Order and have determined that it does not have implications for federalism.

Unfunded Mandates Reform Act

The Unfunded Mandates Reform Act of 1995 (2 U.S.C. 1531-1538) requires Federal agencies to assess the effects of their discretionary regulatory actions. In particular, the Act addresses actions that may result in the expenditure by a State, local, or tribal government, in the aggregate, or by the private sector of $100,000,000 or more in any one year. This rule affects only those persons who violate Federal law or regulations, and involves no discretion on the part of the Coast Guard.

Taking of Private Property

This rule will not effect a taking of private property or otherwise have taking implications under Executive Order 12630, Governmental Actions and Interference with Constitutionally Protected Property Rights.

Civil Justice Reform

This rule meets applicable standards in sections 3(a) and 3(b)(2) of Executive Order 12988, Civil Justice Reform, to minimize litigation, eliminate ambiguity, and reduce burden.

Protection of Children

We have analyzed this rule under Executive Order 13045, Protection of Children from Environmental Health Risks and Safety Risks. This rule is not an economically significant rule and does not create an environmental risk to health or risk to safety that may disproportionately affect children.

Indian Tribal Governments

This rule does not have tribal implications under Executive Order 13175, Consultation and Coordination with Indian Tribal Governments, because it does not have a substantial direct effect on one or more Indian tribes, on the relationship between the Federal Government and Indian tribes, or on the distribution of power and responsibilities between the Federal Government and Indian tribes.

Energy Effects

We have analyzed this rule under Executive Order 13211, Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use. We have determined that it is not a “significant energy action” under that order because it is not a “significant regulatory action” under Executive Order 12866 and is not likely to have a significant adverse effect on the supply, distribution, or use of energy. The Administrator of the Office of Information and Regulatory Affairs has not designated it as a significant energy action. Therefore, it does not require a Statement of Energy Effects under Executive Order 13211.

Environment

We have analyzed this rule under Commandant Instruction M16475.lD, which guides the Coast Guard in complying with the National Environmental Policy Act of 1969 (NEPA)(42 U.S.C. 4321-4370f), and have concluded that there are no factors in this case that would limit the use of a categorical exclusion under section 2.B.2 of the Instruction. Therefore, figure 2-1, paragraph (34)(a) of the Instruction categorically excludes this rule from further environmental documentation. An “Environmental Analysis Check List” and a “Categorical Exclusion Determination” are available in the docket where indicated under ADDRESSES.

List of Subjects in 33 CFR Part 27

• Marine safety
• Oil pollution
• Penalties
• Vessels
• Waterways

For the reasons discussed in the preamble, the Coast Guard amends 33 CFR part 27 as follows:

PART 27—ADJUSTMENT OF CIVIL MONETARY PENALTIES FOR INFLATION

1. Revise the authority citation for part 27 to read as follows:

Authority: Secs. 1-6, Pub. L. 101-410, 104 Stat. 890, as amended by Sec. 31001(s)(1), Pub. L. 104-134, 110 Stat. 1321 (28 U.S.C. 2461 note); Department of Homeland Security Delegation No. 0170.1, sec. 2 (106).

2. Revise § 27.1 to read as follows:

3. Remove § 27.2.

4. Revise § 27.3 to read as follows: