Rules of Practice and Procedure; Civil Money Penalty Inflation Adjustment, 51241-51243 [05-17232]
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51241
Rules and Regulations
Federal Register
Vol. 70, No. 167
Tuesday, August 30, 2005
This section of the FEDERAL REGISTER
contains regulatory documents having general
applicability and legal effect, most of which
are keyed to and codified in the Code of
Federal Regulations, which is published under
50 titles pursuant to 44 U.S.C. 1510.
The Code of Federal Regulations is sold by
the Superintendent of Documents. Prices of
new books are listed in the first FEDERAL
REGISTER issue of each week.
DEPARTMENT OF HOUSING AND
URBAN DEVELOPMENT
Office of Federal Housing Enterprise
Oversight
12 CFR Part 1780
RIN 2550–AA17
Rules of Practice and Procedure; Civil
Money Penalty Inflation Adjustment
Office of Federal Housing
Enterprise Oversight, HUD.
ACTION: Final rule.
AGENCY:
SUMMARY: The Office of Federal Housing
Enterprise Oversight is issuing this final
rule amending its rules of practice and
procedure to adjust each civil money
penalty within its jurisdiction to
account for inflation, pursuant to the
Federal Civil Penalties Inflation
Adjustment Act of 1990, as amended by
the Debt Collection Improvement Act of
1996.
DATES: This rule is effective on August
30, 2005.
FOR FURTHER INFORMATION CONTACT:
David W. Roderer, Deputy General
Counsel, at (202) 414–3804; Charlotte A.
Reid, Associate General Counsel, at
(202) 414–3810; or Frank R. Wright,
Senior Counsel, at (202) 414–6439 (not
toll-free numbers); Office of Federal
Housing Enterprise Oversight, Fourth
Floor, 1700 G Street, NW., Washington,
DC 20552. The telephone number for
the Telecommunications Device for the
Deaf is: (800) 877–8339 (TDD only).
SUPPLEMENTARY INFORMATION
Background
The Office of Federal Housing
Enterprise Oversight (OFHEO), an
independent office within the
Department of Housing and Urban
Development (HUD), is the exclusive
financial safety and soundness regulator
of the Federal National Mortgage
VerDate Aug<18>2005
15:13 Aug 29, 2005
Jkt 205001
Association (Fannie Mae) and the
Federal Home Loan Mortgage
Corporation (Freddie Mac) (collectively,
the Enterprises) under the Federal
Housing Enterprises Financial Safety
and Soundness Act of 1992 (Act), as
amended.1 The Enterprises are
government-sponsored corporations
chartered to provide liquidity to the
residential mortgage market and to
promote the availability of mortgage
credit by investing in residential
mortgages and guaranteeing securities
backed by residential mortgages.2
OFHEO oversees the Enterprises to
ensure that they remain adequately
capitalized and operate in a safe and
sound manner and in accordance with
applicable laws, rules and regulations.
To that end OFHEO is vested with broad
supervisory discretion and specific civil
administrative enforcement powers,
similar to such authority granted by
Congress to the Federal bank regulatory
agencies.3 In particular, section 1376 of
the Act (12 U.S.C. 4636) empowers
OFHEO to impose civil money penalties
under specific conditions. OFHEO’s
Rules of Practice and Procedure (12 CFR
part 1780) govern cease and desist
proceedings, civil money penalty
assessment proceedings and other
administrative adjudications.4
The Inflation Adjustment Act
The Federal Civil Penalties Inflation
Adjustment Act of 1990, as amended by
the Debt Collection Improvement Act of
1996 (the Inflation Adjustment Act)
requires OFHEO, as well as other
Federal agencies with the authority to
issue civil money penalties (CMPs), to
publish regulations to adjust the
maximum amount of each CMP
authorized by law that the agency has
jurisdiction to administer.5 The
Inflation Adjustment Act required
agencies to make an initial adjustment
of their CMPs upon the statute’s
1 See
Federal Housing Enterprises Financial
Safety and Soundness Act of 1992, Pub. L. 102–550,
Title XIII, Section 1301, Oct. 28, 1992, 106 Stat.
3672, 3941–4012 (codified at 12 U.S.C. 4501 et
seq.).
2 See Federal Home Loan Mortgage Corporation
Act, 12 U.S.C. 1451 et seq.; Federal National
Mortgage Association Charter Act, 12 U.S.C. 1716
et seq.; Act at 12 U.S.C. 4561–67, 4562 note.
3 See Pub. L. No. 102–550, Title XIII, Section 1313
and 1371–1379B (Subtitle C—Enforcement
Provisions) (codified at 12 U.S.C. 4513 and 4631–
4641, respectively).
4 See 12 CFR 1780.1
5 See 28 U.S.C. 2461 note.
PO 00000
Frm 00001
Fmt 4700
Sfmt 4700
enactment, and further requires agencies
to make additional adjustments on an
ongoing basis, every four years
following the initial adjustment. The
purpose of these periodic adjustments is
to maintain the deterrent effect of CMPs
and promote compliance with the law.
Subpart E of OFHEO’s Rules of Practice
and Procedure sets forth the Civil
Money Penalty Inflation Adjustment
amounts and discusses their
applicability. See 12 CFR parts 1780.80–
81.
As required, OFHEO made the initial
adjustment to the maximum civil money
penalty amounts in 1997, and provided
that such adjustments were applicable
to any violation occurring after October
23, 1996 (the effective date of the
Inflation Adjustment Act).6 The last
adjustment was made in 2000, effective
January 4, 2001.7 OFHEO again is
amending the maximum civil money
penalty amount for each tier that
OFHEO has authority to impose under
12 U.S.C. 4636 in accordance with the
Inflation Adjustment Act.
Under the Inflation Adjustment Act,
the inflation adjustment for each
applicable CMP is determined by
increasing the maximum CMP amount
per violation by a cost-of-living
adjustment. As is described in detail
below, the Inflation Adjustment Act
provides that this cost-of-living
adjustment is to reflect the percentage
increase in the Consumer Price Index
since the CMPs were last adjusted or
established, and rounded in accordance
with rules provided in the statute.8
Description of the Rule
This final rule adjusts the maximum
penalty amount within each of the three
tiers specified in 12 U.S.C. 4636 by
amending the table contained in 12 CFR
part 1780.80 to reflect the new adjusted
maximum penalty amount that OFHEO
6 See
62 FR 68152, December 31, 1997.
66 FR 709, Jan. 4, 2001.
8 The Inflation Adjustment Act specifically
identifies the Consumer Price Index for All Urban
Consumers published by the United States
Department of Labor (CPI–U). The Department of
Labor (DOL) computes the CPI–U using two
different base time periods, 1967 and 1982–1984.
The Inflation Adjustment Act does not specify
which of these base periods should be used to
calculate the inflation adjustment. OFHEO
calculated the initial adjustment of its CMPs using
CPI–U data with the 1967 base period. OFHEO is
using CPI–U data with the 1982–1984 base period
for the adjustments adopted in this final rule,
because such data now reflect the most current
method of computing the CPI–U.
7 See
E:\FR\FM\30AUR1.SGM
30AUR1
51242
Federal Register / Vol. 70, No. 167 / Tuesday, August 30, 2005 / Rules and Regulations
may impose upon an executive officer
or director or an Enterprise within each
tier. The increases in maximum penalty
amounts contained in this final rule
may not necessarily affect the amount of
any CMP that OFHEO may seek for a
particular violation; OFHEO would
calculate each CMP on a case-by-case
basis in light of a variety of factors.9
The Inflation Adjustment Act directs
federal agencies to calculate each CMP
adjustment as the percentage by which
the CPI–U for June of the calendar year
preceding the adjustment exceeds the
CPI–U for June of the calendar year in
which the amount of each CMP was last
adjusted. The CMP for Third Tier
penalties by an Enterprise was adjusted
in 2000, and every other CMP was last
adjusted in 1997.10 Since OFHEO is
making this round of adjustments in
calendar year 2005, and OFHEO made
the last round of adjustments in
calendar year 2000, the inflation
adjustment amount for each CMP that
was adjusted in 2000 was calculated by
comparing the CPI–U for June 2000
(172.4) with the CPI–U for June 2004
(189.7), resulting in an inflation
adjustment of 10.0 percent.11 For each
CMP that was last adjusted in 1997, the
U.S. code citation
12
12
12
12
12
U.S.C.
U.S.C.
U.S.C.
U.S.C.
U.S.C.
4636(b)(1)
4636(b)(2)
4636(b)(2)
4636(b)(3)
4636(b)(3)
..............
..............
..............
..............
..............
First Tier .....................................................................
Second Tier (Executive Officer or Director) ...............
Second Tier (Enterprise) ............................................
Third Tier (Executive Officer or Director) ...................
Third Tier (Enterprise) ................................................
Executive Order 12866, Regulatory
Planning and Review
OFHEO finds good cause that notice
and an opportunity to comment on this
document are unnecessary under the
Administrative Procedure Act, 5 U.S.C.
551–559, as amended (APA). This
rulemaking conforms with and is
consistent with the statutory directive
set forth in the Inflation Adjustment
Act, with no issues of policy discretion,
and public comment is impracticable
and unnecessary. Accordingly, OFHEO
is issuing the amendments as a final
rule.
In addition, OFHEO finds good cause
to make this rule effective upon
publication of this document in the
Federal Register under the APA. See 5
U.S.C. 553(d). This final rule does not
impose any additional responsibilities
on any entity. Instead, it simply adjusts
the amount of each CMP tier as dictated
by the Inflation Adjustment Act.
9 See,
e.g., 12 CFR part 1780.1(c).
66 FR 709, Jan. 4, 2001; 62 FR 68152, Dec.
31, 1997.
11 OFHEO’s last round of adjustments in 2000
applied an inflation factor of 3.7 percent, calculated
by comparing June 1997 data to June 1999 data. The
1997 data was used as the base period in
accordance with the Inflation Adjustment Act’s
directive to use CPI–U data from the year of the
CMP’s previous adjustment. The resulting penalty
10 See
15:13 Aug 29, 2005
Jkt 205001
5,500
11,000
27,500
110,000
1,150,000
Regulatory Impact
Public Notice and Comment and
Delayed Effective Date Not Required
VerDate Aug<18>2005
Previous
maximum
penalty
amount
Description
Section 1780.81 states that the
adjustments made in § 1780.80 apply
only to violations that occur after the
effective date, August 30, 2005.
This final rule is not classified as a
significant rule under Executive Order
12866 because it will not result in an
annual effect on the economy of $100
million or more or a major increase in
costs or prices for consumers,
individual industries, Federal, State, or
local government agencies, or
geographic regions; or have significant
adverse effects on competition,
employment, investment, productivity,
innovation, or on the ability of United
States-based Enterprises to compete
with foreign-based enterprises in
domestic or foreign markets.
Accordingly, no regulatory impact
assessment is required and this final
rule has not been submitted to the
Office of Management and Budget for
review.
Unfunded Mandates Reform Act of 1995
This final rule does not include a
Federal mandate that may result in the
expenditure by State, local, and tribal
governments, in the aggregate, or by the
private sector, of $100,000,000 or more
(adjusted annually for inflation) in any
was then rounded in accordance with the statutory
rules described below. 66 FR 709, January 4, 2001.
Although the adjustment is being made in calendar
year 2005, the resulting CMP increases do not take
effect until publication of the rule, and will only
apply to conduct occurring after such data.
12 The statute’s rounding rules require that each
increase be rounded to the nearest multiple as
follows: $10 in the case of penalties less than or
equal to $100; $100 in the case of penalties greater
PO 00000
Frm 00002
Fmt 4700
inflation adjustment amount was
calculated by comparing the CPI–U for
June 1997 (160.3) with the CPI–U for
June 2004 (189.7), resulting in an
inflation adjustment of 18.3 percent. For
each CMP, the product of this inflation
adjustment and the previous maximum
penalty amount was then rounded in
accordance with the specific
requirements of the Inflation
Adjustment Act, and was then summed
with the previous maximum penalty
amount to determine the new adjusted
maximum penalty amount.12 The table
below sets out these items accordingly.
Sfmt 4700
Inflation
increase
1,006.50
2,013
5,032.50
20,130
115,000
Rounded
inflation
increase
New adjusted maximum penalty amount
1,000
0
5,000
20,000
125,000
6,500
11,000
32,500
130,000
1,275,000
one year. As a result, the final rule does
not warrant the preparation of an
assessment statement in accordance
with the Unfunded Mandates Reform
Act of 1995.
Regulatory Flexibility Act
The Regulatory Flexibility Act (5
U.S.C. 601 et seq.) only applies to rules
for which an agency publishes a general
notice of proposed rulemaking pursuant
to 5 U.S.C. 553(b) (see 5 U.S.C. 601(2)).
OFHEO has determined for good cause
that the APA does not require a general
notice of proposed rulemaking for this
regulatory action. The Regulatory
Flexibility Act does not apply to this
final rule.
Paperwork Reduction Act of 1995
The rule contains no information
collection requirements that require the
approval of the Office of Management
and Budget pursuant to the Paperwork
Reduction Act, 44 U.S.C. 3501–3520.
List of Subjects in 12 CFR Part 1780
Administrative practice and
procedure, Penalties.
Accordingly, for the reasons set out in
the preamble, the Office of Federal
I
than $100 but less than or equal to $1,000; $1,000
in the case of penalties greater than $1,000 but less
than or equal to $10,000; $5,000 in the case of
penalties greater than $10,000 but less than or equal
to $100,000; $10,000 in the case of penalties greater
than $100,000 but less than or equal to $200,000;
and $25,000 in the case of penalties greater than
$200,000.
E:\FR\FM\30AUR1.SGM
30AUR1
Federal Register / Vol. 70, No. 167 / Tuesday, August 30, 2005 / Rules and Regulations
Housing Enterprise Oversight hereby
amends 12 CFR part 1780 as follows:
I
2. Revise Subpart E of part 1780 to
read as follows:
PART 1780—RULES OF PRACTICE
AND PROCEDURE
Subpart E—Civil Money Penalty
Inflation Adjustments
I
1. The authority citation for part 1780
is revised to read as follows:
§ 1780.80
Authority: 12 U.S.C. 4501, 4513(b), 4517,
4521, 4631–4641.
51243
The maximum amount of each civil
money penalty within OFHEO’s
jurisdiction is adjusted in accordance
Inflation adjustments.
U.S. code citation
12
12
12
12
12
U.S.C.
U.S.C.
U.S.C.
U.S.C.
U.S.C.
§ 1780.81
4636(b)(1)
4636(b)(2)
4636(b)(2)
4636(b)(3)
4636(b)(3)
.................................
.................................
.................................
.................................
.................................
First Tier ...................................................................................................................
Second Tier (Executive Officer or Director) ............................................................
Second Tier (Enterprise) .........................................................................................
Third Tier (Executive Officer or Director) ................................................................
Third Tier (Enterprise) .............................................................................................
Applicability.
Dated: August 25, 2005.
Stephen A. Blumenthal,
Acting Director, Office of Federal Housing
Enterprise Oversight.
[FR Doc. 05–17232 Filed 8–29–05; 8:45 am]
BILLING CODE 4220–01–U
SMALL BUSINESS ADMINISTRATION
13 CFR Parts 121, 124, 125 and 126
RIN 3245–AF31
HUBZone, Government Contracting,
8(a) Business Development and Small
Business Size Standard Programs
U.S. Small Business
Administration (SBA).
ACTION: Interim rule with request for
comments.
AGENCY:
SUMMARY: This interim rule amends
SBA’s HUBZone, 8(a) Business
Development, Government Contracting
and Size Standard regulations to
implement provisions of the Small
Business Act including the
Consolidated Appropriations Act, 2005,
specifically, Subtitle E of Division K
entitled the Small Business
Reauthorization and Manufacturing
Assistance Act of 2004. Consistent with
the new statutory requirements under
Subtitle E, this interim rule: Amends the
definitions of the terms ‘‘business
concern,’’ ‘‘affiliation,’’ ‘‘HUBZone
small business concern’’ and ‘‘qualified
HUBZone small business concern;’’
amends the HUBZone eligibility
requirements for tribally-owned
15:13 Aug 29, 2005
New adjusted
maximum
penalty amount
Description
The inflation adjustments in § 1780.80
apply to civil money penalties assessed
in accordance with the provisions of 12
U.S.C. 4636 for violations occurring
after the effective date, August 30, 2005.
VerDate Aug<18>2005
with the Federal Civil Penalties
Inflation Adjustment Act of 1990, as
amended by the Debt Collection
Improvement Act of 1996 (28 U.S.C.
2461 note) as follows:
Jkt 205001
HUBZone concerns; extends qualified
HUBZone areas to include military base
closure areas for a period of five years;
revises the definition of a ‘‘qualified
non-metropolitan county;’’ extends the
redesignation period for HUBZone areas
through the release of the 2010 census
data; and provides a five percent
HUBZone evaluation price preference
for agricultural commodities in
international food aid procurements.
Pursuant to the Administrative
Procedure Act, SBA has determined that
there is good cause to issue this rule as
an interim rule with an immediate
effective date. However, SBA
encourages and will consider all timely
public comments in developing the final
rule.
DATES: This interim rule is effective
August 30, 2005. Comments must be
received on or before October 31, 2005.
ADDRESSES: You may submit comments,
identified by RIN #3245–AF31, by any
of the following methods:
Internet: https://www.regulations.gov.
Follow the instructions for submitting
comments. E-mail: hubzone@sba.gov.
Fax: (202) 481–5593.
Mail or Hand Deliver: Michael
McHale, Associate Administrator for the
HUBZone Program, 409 Third Street,
SW., Washington, DC, 20416.
FOR FURTHER INFORMATION CONTACT:
Sheryl J. Swed, Office of Government
Contracting, at (202) 205–6413 or by
e-mail at: sheryl.swed@sba.gov.
SUPPLEMENTARY INFORMATION:
A. Statutory Authority
On December 8, 2004, the President
signed into law the Consolidated
Appropriations Act, 2005, Public Law
108–447 which contained the Small
Business Reauthorization and
Manufacturing Assistance Act of 2004
(the Reauthorization Act). Subtitle E of
PO 00000
Frm 00003
Fmt 4700
Sfmt 4700
6,500
11,000
32,500
130,000
1,275,000
the Reauthorization Act amended
certain provisions of the Small Business
Act, 15 U.S.C. 631 et. seq., that govern
the HUBZone program and the
definition of small agricultural
cooperative.
1. Section 151 of the Reauthorization
Act
In particular, Section 151 of the
Reauthorization Act relaxed the
statutory requirement that a HUBZone
small business concern (SBC) must be
entirely owned by U.S. citizens.
Congress concluded that this statutory
mandate precluded small business
owners from taking advantage of
available forms of business
organizations that limit the personal
liability of business owners. It also
precluded ownership by small
agricultural cooperatives that operate in
rural HUBZones, and thereby deprived
those communities of the economic
benefits of increased HUBZone
contracting opportunities.
As a result, Section 151 of the
Reauthorization Act amended the
definition of ‘‘HUBZone SBC’’ in section
3(p)(3)(A) of the Small Business Act, 15
U.S.C 632(p)(3)(A), to require that SBCs
eligible for HUBZone certification be 51
percent (instead of 100 percent) owned
and controlled by U.S. citizens. It also
added a new section 3(p)(3)(E) to the
Small Business Act, 15 U.S.C
632(p)(3)(E), to include as HUBZone
SBCs small agricultural cooperatives or
SBCs wholly or partially-owned by
small agricultural cooperatives
organized and incorporated in the
United States. Also in connection with
agricultural cooperatives, Section 151
further amended Section 3(j) of the
Small Business Act, 15 U.S.C. 632(j), to
require that small agricultural
cooperatives be treated as business
concerns for purposes of the Small
E:\FR\FM\30AUR1.SGM
30AUR1
]]>Agencies
[Federal Register Volume 70, Number 167 (Tuesday, August 30, 2005)]
[Rules and Regulations]
[Pages 51241-51243]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 05-17232]
========================================================================
Rules and Regulations
Federal Register
________________________________________________________________________
This section of the FEDERAL REGISTER contains regulatory documents
having general applicability and legal effect, most of which are keyed
to and codified in the Code of Federal Regulations, which is published
under 50 titles pursuant to 44 U.S.C. 1510.
The Code of Federal Regulations is sold by the Superintendent of Documents.
Prices of new books are listed in the first FEDERAL REGISTER issue of each
week.
========================================================================
Federal Register / Vol. 70, No. 167 / Tuesday, August 30, 2005 /
Rules and Regulations
[[Page 51241]]
DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
Office of Federal Housing Enterprise Oversight
12 CFR Part 1780
RIN 2550-AA17
Rules of Practice and Procedure; Civil Money Penalty Inflation
Adjustment
AGENCY: Office of Federal Housing Enterprise Oversight, HUD.
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: The Office of Federal Housing Enterprise Oversight is issuing
this final rule amending its rules of practice and procedure to adjust
each civil money penalty within its jurisdiction to account for
inflation, pursuant to the Federal Civil Penalties Inflation Adjustment
Act of 1990, as amended by the Debt Collection Improvement Act of 1996.
DATES: This rule is effective on August 30, 2005.
FOR FURTHER INFORMATION CONTACT: David W. Roderer, Deputy General
Counsel, at (202) 414-3804; Charlotte A. Reid, Associate General
Counsel, at (202) 414-3810; or Frank R. Wright, Senior Counsel, at
(202) 414-6439 (not toll-free numbers); Office of Federal Housing
Enterprise Oversight, Fourth Floor, 1700 G Street, NW., Washington, DC
20552. The telephone number for the Telecommunications Device for the
Deaf is: (800) 877-8339 (TDD only).
SUPPLEMENTARY INFORMATION
Background
The Office of Federal Housing Enterprise Oversight (OFHEO), an
independent office within the Department of Housing and Urban
Development (HUD), is the exclusive financial safety and soundness
regulator of the Federal National Mortgage Association (Fannie Mae) and
the Federal Home Loan Mortgage Corporation (Freddie Mac) (collectively,
the Enterprises) under the Federal Housing Enterprises Financial Safety
and Soundness Act of 1992 (Act), as amended.\1\ The Enterprises are
government-sponsored corporations chartered to provide liquidity to the
residential mortgage market and to promote the availability of mortgage
credit by investing in residential mortgages and guaranteeing
securities backed by residential mortgages.\2\ OFHEO oversees the
Enterprises to ensure that they remain adequately capitalized and
operate in a safe and sound manner and in accordance with applicable
laws, rules and regulations. To that end OFHEO is vested with broad
supervisory discretion and specific civil administrative enforcement
powers, similar to such authority granted by Congress to the Federal
bank regulatory agencies.\3\ In particular, section 1376 of the Act (12
U.S.C. 4636) empowers OFHEO to impose civil money penalties under
specific conditions. OFHEO's Rules of Practice and Procedure (12 CFR
part 1780) govern cease and desist proceedings, civil money penalty
assessment proceedings and other administrative adjudications.\4\
---------------------------------------------------------------------------
\1\ See Federal Housing Enterprises Financial Safety and
Soundness Act of 1992, Pub. L. 102-550, Title XIII, Section 1301,
Oct. 28, 1992, 106 Stat. 3672, 3941-4012 (codified at 12 U.S.C. 4501
et seq.).
\2\ See Federal Home Loan Mortgage Corporation Act, 12 U.S.C.
1451 et seq.; Federal National Mortgage Association Charter Act, 12
U.S.C. 1716 et seq.; Act at 12 U.S.C. 4561-67, 4562 note.
\3\ See Pub. L. No. 102-550, Title XIII, Section 1313 and 1371-
1379B (Subtitle C--Enforcement Provisions) (codified at 12 U.S.C.
4513 and 4631-4641, respectively).
\4\ See 12 CFR 1780.1
---------------------------------------------------------------------------
The Inflation Adjustment Act
The Federal Civil Penalties Inflation Adjustment Act of 1990, as
amended by the Debt Collection Improvement Act of 1996 (the Inflation
Adjustment Act) requires OFHEO, as well as other Federal agencies with
the authority to issue civil money penalties (CMPs), to publish
regulations to adjust the maximum amount of each CMP authorized by law
that the agency has jurisdiction to administer.\5\ The Inflation
Adjustment Act required agencies to make an initial adjustment of their
CMPs upon the statute's enactment, and further requires agencies to
make additional adjustments on an ongoing basis, every four years
following the initial adjustment. The purpose of these periodic
adjustments is to maintain the deterrent effect of CMPs and promote
compliance with the law. Subpart E of OFHEO's Rules of Practice and
Procedure sets forth the Civil Money Penalty Inflation Adjustment
amounts and discusses their applicability. See 12 CFR parts 1780.80-81.
---------------------------------------------------------------------------
\5\ See 28 U.S.C. 2461 note.
---------------------------------------------------------------------------
As required, OFHEO made the initial adjustment to the maximum civil
money penalty amounts in 1997, and provided that such adjustments were
applicable to any violation occurring after October 23, 1996 (the
effective date of the Inflation Adjustment Act).\6\ The last adjustment
was made in 2000, effective January 4, 2001.\7\ OFHEO again is amending
the maximum civil money penalty amount for each tier that OFHEO has
authority to impose under 12 U.S.C. 4636 in accordance with the
Inflation Adjustment Act.
---------------------------------------------------------------------------
\6\ See 62 FR 68152, December 31, 1997.
\7\ See 66 FR 709, Jan. 4, 2001.
---------------------------------------------------------------------------
Under the Inflation Adjustment Act, the inflation adjustment for
each applicable CMP is determined by increasing the maximum CMP amount
per violation by a cost-of-living adjustment. As is described in detail
below, the Inflation Adjustment Act provides that this cost-of-living
adjustment is to reflect the percentage increase in the Consumer Price
Index since the CMPs were last adjusted or established, and rounded in
accordance with rules provided in the statute.\8\
---------------------------------------------------------------------------
\8\ The Inflation Adjustment Act specifically identifies the
Consumer Price Index for All Urban Consumers published by the United
States Department of Labor (CPI-U). The Department of Labor (DOL)
computes the CPI-U using two different base time periods, 1967 and
1982-1984. The Inflation Adjustment Act does not specify which of
these base periods should be used to calculate the inflation
adjustment. OFHEO calculated the initial adjustment of its CMPs
using CPI-U data with the 1967 base period. OFHEO is using CPI-U
data with the 1982-1984 base period for the adjustments adopted in
this final rule, because such data now reflect the most current
method of computing the CPI-U.
---------------------------------------------------------------------------
Description of the Rule
This final rule adjusts the maximum penalty amount within each of
the three tiers specified in 12 U.S.C. 4636 by amending the table
contained in 12 CFR part 1780.80 to reflect the new adjusted maximum
penalty amount that OFHEO
[[Page 51242]]
may impose upon an executive officer or director or an Enterprise
within each tier. The increases in maximum penalty amounts contained in
this final rule may not necessarily affect the amount of any CMP that
OFHEO may seek for a particular violation; OFHEO would calculate each
CMP on a case-by-case basis in light of a variety of factors.\9\
---------------------------------------------------------------------------
\9\ See, e.g., 12 CFR part 1780.1(c).
---------------------------------------------------------------------------
The Inflation Adjustment Act directs federal agencies to calculate
each CMP adjustment as the percentage by which the CPI-U for June of
the calendar year preceding the adjustment exceeds the CPI-U for June
of the calendar year in which the amount of each CMP was last adjusted.
The CMP for Third Tier penalties by an Enterprise was adjusted in 2000,
and every other CMP was last adjusted in 1997.\10\ Since OFHEO is
making this round of adjustments in calendar year 2005, and OFHEO made
the last round of adjustments in calendar year 2000, the inflation
adjustment amount for each CMP that was adjusted in 2000 was calculated
by comparing the CPI-U for June 2000 (172.4) with the CPI-U for June
2004 (189.7), resulting in an inflation adjustment of 10.0 percent.\11\
For each CMP that was last adjusted in 1997, the inflation adjustment
amount was calculated by comparing the CPI-U for June 1997 (160.3) with
the CPI-U for June 2004 (189.7), resulting in an inflation adjustment
of 18.3 percent. For each CMP, the product of this inflation adjustment
and the previous maximum penalty amount was then rounded in accordance
with the specific requirements of the Inflation Adjustment Act, and was
then summed with the previous maximum penalty amount to determine the
new adjusted maximum penalty amount.\12\ The table below sets out these
items accordingly.
---------------------------------------------------------------------------
\10\ See 66 FR 709, Jan. 4, 2001; 62 FR 68152, Dec. 31, 1997.
\11\ OFHEO's last round of adjustments in 2000 applied an
inflation factor of 3.7 percent, calculated by comparing June 1997
data to June 1999 data. The 1997 data was used as the base period in
accordance with the Inflation Adjustment Act's directive to use CPI-
U data from the year of the CMP's previous adjustment. The resulting
penalty was then rounded in accordance with the statutory rules
described below. 66 FR 709, January 4, 2001. Although the adjustment
is being made in calendar year 2005, the resulting CMP increases do
not take effect until publication of the rule, and will only apply
to conduct occurring after such data.
\12\ The statute's rounding rules require that each increase be
rounded to the nearest multiple as follows: $10 in the case of
penalties less than or equal to $100; $100 in the case of penalties
greater than $100 but less than or equal to $1,000; $1,000 in the
case of penalties greater than $1,000 but less than or equal to
$10,000; $5,000 in the case of penalties greater than $10,000 but
less than or equal to $100,000; $10,000 in the case of penalties
greater than $100,000 but less than or equal to $200,000; and
$25,000 in the case of penalties greater than $200,000.
----------------------------------------------------------------------------------------------------------------
New
Previous Rounded adjusted
U.S. code citation Description maximum Inflation inflation maximum
penalty increase increase penalty
amount amount
----------------------------------------------------------------------------------------------------------------
12 U.S.C. 4636(b)(1).................... First Tier........ 5,500 1,006.50 1,000 6,500
12 U.S.C. 4636(b)(2).................... Second Tier 11,000 2,013 0 11,000
(Executive
Officer or
Director).
12 U.S.C. 4636(b)(2).................... Second Tier 27,500 5,032.50 5,000 32,500
(Enterprise).
12 U.S.C. 4636(b)(3).................... Third Tier 110,000 20,130 20,000 130,000
(Executive
Officer or
Director).
12 U.S.C. 4636(b)(3).................... Third Tier 1,150,000 115,000 125,000 1,275,000
(Enterprise).
----------------------------------------------------------------------------------------------------------------
Section 1780.81 states that the adjustments made in Sec. 1780.80
apply only to violations that occur after the effective date, August
30, 2005.
Public Notice and Comment and Delayed Effective Date Not Required
OFHEO finds good cause that notice and an opportunity to comment on
this document are unnecessary under the Administrative Procedure Act, 5
U.S.C. 551-559, as amended (APA). This rulemaking conforms with and is
consistent with the statutory directive set forth in the Inflation
Adjustment Act, with no issues of policy discretion, and public comment
is impracticable and unnecessary. Accordingly, OFHEO is issuing the
amendments as a final rule.
In addition, OFHEO finds good cause to make this rule effective
upon publication of this document in the Federal Register under the
APA. See 5 U.S.C. 553(d). This final rule does not impose any
additional responsibilities on any entity. Instead, it simply adjusts
the amount of each CMP tier as dictated by the Inflation Adjustment
Act.
Regulatory Impact
Executive Order 12866, Regulatory Planning and Review
This final rule is not classified as a significant rule under
Executive Order 12866 because it will not result in an annual effect on
the economy of $100 million or more or a major increase in costs or
prices for consumers, individual industries, Federal, State, or local
government agencies, or geographic regions; or have significant adverse
effects on competition, employment, investment, productivity,
innovation, or on the ability of United States-based Enterprises to
compete with foreign-based enterprises in domestic or foreign markets.
Accordingly, no regulatory impact assessment is required and this
final rule has not been submitted to the Office of Management and
Budget for review.
Unfunded Mandates Reform Act of 1995
This final rule does not include a Federal mandate that may result
in the expenditure by State, local, and tribal governments, in the
aggregate, or by the private sector, of $100,000,000 or more (adjusted
annually for inflation) in any one year. As a result, the final rule
does not warrant the preparation of an assessment statement in
accordance with the Unfunded Mandates Reform Act of 1995.
Regulatory Flexibility Act
The Regulatory Flexibility Act (5 U.S.C. 601 et seq.) only applies
to rules for which an agency publishes a general notice of proposed
rulemaking pursuant to 5 U.S.C. 553(b) (see 5 U.S.C. 601(2)). OFHEO has
determined for good cause that the APA does not require a general
notice of proposed rulemaking for this regulatory action. The
Regulatory Flexibility Act does not apply to this final rule.
Paperwork Reduction Act of 1995
The rule contains no information collection requirements that
require the approval of the Office of Management and Budget pursuant to
the Paperwork Reduction Act, 44 U.S.C. 3501-3520.
List of Subjects in 12 CFR Part 1780
Administrative practice and procedure, Penalties.
0
Accordingly, for the reasons set out in the preamble, the Office of
Federal
[[Page 51243]]
Housing Enterprise Oversight hereby amends 12 CFR part 1780 as follows:
PART 1780--RULES OF PRACTICE AND PROCEDURE
0
1. The authority citation for part 1780 is revised to read as follows:
Authority: 12 U.S.C. 4501, 4513(b), 4517, 4521, 4631-4641.
0
2. Revise Subpart E of part 1780 to read as follows:
Subpart E--Civil Money Penalty Inflation Adjustments
Sec. 1780.80 Inflation adjustments.
The maximum amount of each civil money penalty within OFHEO's
jurisdiction is adjusted in accordance with the Federal Civil Penalties
Inflation Adjustment Act of 1990, as amended by the Debt Collection
Improvement Act of 1996 (28 U.S.C. 2461 note) as follows:
----------------------------------------------------------------------------------------------------------------
New adjusted
U.S. code citation Description maximum penalty
amount
----------------------------------------------------------------------------------------------------------------
12 U.S.C. 4636(b)(1)......................................... First Tier..................... 6,500
12 U.S.C. 4636(b)(2)......................................... Second Tier (Executive Officer 11,000
or Director).
12 U.S.C. 4636(b)(2)......................................... Second Tier (Enterprise)....... 32,500
12 U.S.C. 4636(b)(3)......................................... Third Tier (Executive Officer 130,000
or Director).
12 U.S.C. 4636(b)(3)......................................... Third Tier (Enterprise)........ 1,275,000
----------------------------------------------------------------------------------------------------------------
Sec. 1780.81 Applicability.
The inflation adjustments in Sec. 1780.80 apply to civil money
penalties assessed in accordance with the provisions of 12 U.S.C. 4636
for violations occurring after the effective date, August 30, 2005.
Dated: August 25, 2005.
Stephen A. Blumenthal,
Acting Director, Office of Federal Housing Enterprise Oversight.
[FR Doc. 05-17232 Filed 8-29-05; 8:45 am]
BILLING CODE 4220-01-U
