Procedures Governing Administrative Review of a United States Trustee's Decision To Deny a Chapter 12 or Chapter 13 Standing Trustee's Claim of Actual, Necessary Expenses, 41101-41104 [E9-19456]
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Federal Register / Vol. 74, No. 156 / Friday, August 14, 2009 / Proposed Rules
the revised PCB human health water
quality criterion if approved.
When the Commission directed the
executive director in 2005 to initiate
rulemaking on updated PCB criteria, in
accordance with a recommendation of
the TAC, it also asked her to work with
State regulatory agencies and EPA
(collectively, ‘‘co-regulators’’) to
develop recommendations for
implementing criteria for
bioaccumulative toxic pollutants such
as PCBs that would be ‘‘consistent with
the existing Clean Water Act National
Pollutant Discharge Elimination System
(NPDES) framework while * * *
reflecting principles of adaptive
management’’ and to solicit public
comment on these recommendations
(DRBC Resolution No. 2005–19 par’s.
3–4). It is expected that Stage 2 TMDLs
issued by EPA will include as an
appendix a TMDL implementation plan
developed by DRBC and its coregulators. The implementation plan,
which will take the form of a guidance
document, will explain how the load
allocations assigned by the TMDL to
nonpoint sources and the wasteload
allocations assigned to point sources
can be achieved consistent with the
Clean Water Act and principles of
adaptive management.
According to the 2003 and 2006
TMDLs, actual loadings of PCBs to the
Delaware Estuary and Bay respectively
are in some cases orders of magnitude
above those needed to allow attainment
of the designated use. The EPA’s 2003
Delaware Estuary TMDL report projects
that ‘‘due to the scope and complexity
of the problem that has been defined
through these TMDLs, achieving the
estuary water quality standards for PCBs
will take decades.’’ (U.S. Environmental
Protection Agency Regions II and III,
Total Maximum Daily Loads for
Polychlorinated Biphenyls (PCBs) for
Zones 2–5 of the Tidal Delaware River,
December 15, 2003, p. xiii). As required
by Section 4.30.9 of the DRBC Water
Quality Regulations, adopted by DRBC
Resolution No. 2005–9 on May 18, 2005,
the largest point source dischargers of
PCBs to the Delaware Estuary and Bay
have already undertaken pollutant
minimization plans designed to locate
the sources of PCBs entering their
wastewater and stormwater systems and
contain or remove them. The TMDL
implementation plan developed by the
co-regulators recognizes that many point
source dischargers already have reduced
their PCB loadings in an effort to meet
their TMDL wasteload allocations
assigned by the Stage 1 TMDLs. Some
point source dischargers are expected to
achieve their required reductions soon;
however, others will require an
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extended period of time, including in
some instances decades, to achieve the
PCB loading reductions needed to meet
their assigned wasteload allocations.
The implementation plan developed by
the co-regulators will accommodate
these dischargers through the use of
compliance schedules consistent with
the Clean Water Act and applicable
regulations. It is understood that those
dischargers who cannot achieve their
wasteload allocations within a single
five-year permit cycle notwithstanding
good faith efforts to do so as soon as
possible will be given additional time,
even if this requires compliance
schedules extending well beyond a
single five-year permit cycle.
Subjects on which Comment is
Expressly Solicited. Public comment is
solicited on all aspects of the proposed
rule. Without limiting the foregoing, the
Commission has identified certain
subject matters on which it expressly
seeks comment. First, comments are
solicited on the assumptions applied in
developing the criterion, including the
appropriate cancer risk level. (See DRBC
Resolution No. 2005–19, par. 2). In
accordance with current DRBC
regulations, that level is 10¥6, or one
additional cancer in every one million
humans exposed for 70 years. (See
WQR, § 3.10.3 D.4). The assumptions
applied in developing the revised PCB
criterion of 16 picograms per liter are set
forth in a basis and background
document that is available on the DRBC
Web site, https://DRBC.net. The second
area on which the Commission
expressly seeks comment is best
approaches for implementing water
quality criteria for bioaccumulative
pollutants consistent with the NPDES
framework and principles of adaptive
management. (See DRBC Resolution No.
2005–19, par. 4). The third is the
implementation plan developed by the
co-regulators, which is posted on the
Commission’s Web site, https://
DRBC.net.
FOR FURTHER INFORMATION CONTACT: The
text of the proposed rule, relevant DRBC
resolutions, the basis and background
document and the co-regulators’
implementation plan for the proposed
criterion will be available on the DRBC
Web site, https://DRBC.net, on or before
August 17, 2009. For further
information, please contact Commission
Secretary Pamela M. Bush, 609–883–
9500 ext. 203.
Dated: August 4, 2009.
Pamela M. Bush,
Commission Secretary.
[FR Doc. E9–19028 Filed 8–13–09; 8:45 am]
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DEPARTMENT OF JUSTICE
28 CFR Part 58
[Docket No: EOUST 103]
RIN 1105–AB16
Procedures Governing Administrative
Review of a United States Trustee’s
Decision To Deny a Chapter 12 or
Chapter 13 Standing Trustee’s Claim of
Actual, Necessary Expenses
AGENCY: Executive Office for United
States Trustees (‘‘EOUST’’), Justice.
ACTION: Notice of proposed rulemaking.
SUMMARY: This notice of proposed
rulemaking (‘‘rule’’) sets forth the
procedures for a chapter 12 or chapter
13 standing trustee (‘‘trustee’’) to obtain
administrative review of a United States
Trustee’s decision to deny a trustee’s
claim that certain expenses are actual
and necessary for the administration of
bankruptcy cases. Section 1231(b) of the
Bankruptcy Abuse Prevention and
Consumer Protection Act of 2005
(‘‘BAPCPA’’), codified at 28 U.S.C.
586(e), requires that: Trustees exhaust
all administrative remedies pertaining
to a denial of a claim of actual,
necessary expenses before seeking
judicial review; and the Attorney
General prescribe procedures for
administrative review of such denials.
This rule ensures that the process for
administratively reviewing a United
States Trustee’s denial of a trustee’s
request for expenses is fair and effective.
DATES: Submit comments on or before
October 13, 2009.
ADDRESSES: Comments on the rule may
be submitted via https://
www.regulations.gov, by telefax to (202)
307–2397, or by postal mail to EOUST,
20 Massachusetts Ave., NW., 8th Floor,
Washington, DC 20530. To ensure
proper handling of comments, please
reference ‘‘Docket No. EOUST 103—
Trustee Expenses’’ on all written and
electronic correspondence.
FOR FURTHER INFORMATION CONTACT:
Ramona D. Elliott, General Counsel, or
Larry Wahlquist, Office of General
Counsel, at (202) 307–1399 (not a tollfree number).
SUPPLEMENTARY INFORMATION:
Posting of Public Comments
Please note that all comments
received are considered part of the
public record and made available for
public inspection online at https://
www.regulations.gov. Such information
includes personal identifying
information (such as your name,
address, etc.) voluntarily submitted by
the commenter. If you want to submit
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personal identifying information (such
as your name, address, etc.) as part of
your comment, but do not want it to be
posted online, you must include the
phrase ‘‘PERSONAL IDENTIFYING
INFORMATION’’ in the first paragraph
of your comment. You must also locate
all the personal identifying information
you do not want posted online in the
first paragraph of your comment and
identify what information you want
redacted.
If you want to submit confidential
business information as part of your
comment but do not want it to be posted
online, you must include the phrase
‘‘CONFIDENTIAL BUSINESS
INFORMATION’’ in the first paragraph
of your comment. You must also
prominently identify confidential
business information to be redacted
within the comment. If a comment has
so much confidential business
information that it cannot be effectively
redacted, all or part of that comment
may not be posted on https://
www.regulations.gov.
Personal identifying information and
confidential business information
identified and located as set forth above
will be placed in the agency’s public
docket file, but not posted online. If you
wish to inspect the agency’s public
docket file in person by appointment,
please see the FOR FURTHER INFORMATION
CONTACT paragraph. Comments filed
after the end of the comment period
may be considered to the extent feasible.
Discussion of Rule
The administration of all chapter 12
and 13 bankruptcy cases is entrusted to
private persons who are case or standing
trustees under the supervision and
oversight of a regional United States
Trustee. As distinguished from case or
standing trustees, United States Trustees
are employees of the Department of
Justice. A standing trustee is appointed
by the United States Trustee under 28
U.S.C. 586 and administers more than
one chapter 13 or chapter 12 case, as
opposed to a case trustee who is
appointed under 11 U.S.C. 1302 or 11
U.S.C. 1202 and who administers only
the case to which the trustee is
appointed. This rule addresses the right,
conferred by the Bankruptcy Abuse
Prevention and Consumer Protection
Act of 2005 (‘‘BAPCPA’’), of a standing
trustee to obtain administrative review
when the trustee’s request for projected
expenses, referred to as a ‘‘claim of
actual, necessary expenses’’ in 28 U.S.C.
586(e)(3), is denied by the United States
Trustee.
When a debtor files for bankruptcy
relief under chapter 12 or chapter 13,
the debtor proposes a plan to pay his or
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her creditors a percentage of the
amounts owed to creditors over a
specified period of time and obtains
court approval of this plan. This process
is termed confirming a chapter 12 or
chapter 13 plan. Once the bankruptcy
court confirms the plan, the trustee will
oversee the payment of creditors
pursuant to the plan. The debtor pays
plan payments to the trustee and the
trustee then disburses the appropriate
amounts to creditors.
As part of the process of
administering debtors’ cases, a trustee
incurs expenses. A trustee is authorized
to collect a specified percentage of
disbursed funds from debtors’ plan
payments to pay for these expenses.
However, before incurring expenses, a
trustee obtains approval from the United
States Trustee. As the first step in
obtaining United States Trustee
approval for expenses, the United States
Trustee requires that the trustee submit
a budget for the anticipated expenses for
the fiscal year ending each September
30th. Next, these projected expenses are
evaluated by the United States Trustee
who will either approve the expenses or
require modifications to the proposed
budget. Once the United States Trustee
approves the trustee’s budget, the
trustee is notified of this approval, and
pursuant to 28 U.S.C. 586(e), the
trustee’s compensation, and a specified
percentage fee that the trustee may
collect from debtors’ plan payments, is
authorized. This fee is to be used for
payment of the approved expenses
incurred during the fiscal year.
When a trustee realizes that expenses
for the current year might exceed the
approved amount, a trustee must submit
a request to the United States Trustee,
and obtain approval, before incurring
expenses above the approved amount.
This request must be submitted when
the increase to an individual expense
line item is greater than both 10% of the
budgeted amount and $5,000.00.
Expenses for certain items require prior
United States Trustee approval
regardless of amount. These expenses
currently are increases in the amount
budgeted for employee expenses,
increases in office lease obligations,
payments to the standing trustee or
relative of the standing trustee, and
expenses for any item not originally
contained in the approved budget.
These expenses are set forth in the
Chapter 13 Trustee Handbook, which is
posted on the EOUST web site. If any
other expenses are added to this list, the
United States Trustee will notify
trustees via email or regular mail at least
30 days before including the new
expenses in a revision to the Handbook.
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If a trustee disagrees with the United
States Trustee’s denial of the trustee’s
request for expenses, the trustee may
seek administrative review of the denial
under the procedures identified in this
rule. The Director of the EOUST will
conduct a de novo review of the United
States Trustee’s decision to determine
whether the record supports the United
States Trustee’s decision and whether
the decision was an appropriate exercise
of the United States Trustee’s discretion
or contrary to law.
With the passage of BAPCPA,
Congress directed the Attorney General
to prescribe procedures implementing
administrative review for trustees when
a claim of actual, necessary expenses is
denied. The Attorney General delegated
this authority to the Director, Executive
Office for United States Trustees. In
response to this congressional mandate,
the Director publishes this rule, which
establishes such procedures. This rule
imposes requirements only upon
standing trustees who are supervised by
United States Trustees. In addition, this
rule addresses only the United States
Trustee’s denial of a trustee’s claim of
actual, necessary expenses. This rule
does not address the suspension or
termination of trustees. EOUST will
publish another notice of proposed
rulemaking that addresses the
suspension or termination of trustees
with a RIN number of 1105–AB12.
Executive Order 12866
This rule has been drafted and
reviewed in accordance with Executive
Order 12866, ‘‘Regulatory Planning and
Review’’ section 1(b), The Principles of
Regulation. This rule is not a
‘‘significant regulatory action’’ as
defined by Executive Order 12866 and,
accordingly, this rule has not been
reviewed by the Office of Management
and Budget.
The Department has also assessed
both the costs and benefits of this rule
as required by section 1(b)(6) and has
made a reasoned determination that the
benefits of this regulation justify its
costs. The costs considered in this
regulation include the costs for
prosecuting an administrative appeal of
the United States Trustee’s denial of a
trustee’s claim of actual, necessary
expenses. The anticipated costs are the
compiling, photocopying and mailing of
the requested records. However, none of
these costs are new. This rule simply
codifies the current practice for
obtaining administrative review of the
United States Trustee’s decision.
The benefits of this rule include the
codification of the process for a trustee
to obtain administrative review of the
United States Trustee’s denial of a
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trustee’s claim of actual, necessary
expenses. These benefits justify its costs
in complying with Congress’ mandate to
prescribe procedures to implement 28
U.S.C. 586(e).
Executive Order 13132
This rule will not have a substantial
direct effect on the States, on the
relationship between the national
government and the States, or on the
distribution of power and
responsibilities among the various
levels of government. Therefore, in
accordance with Executive Order 13132,
it is determined that this rule does not
have sufficient federalism implications
to warrant the preparation of a
Federalism Assessment.
Paperwork Reduction Act
This rule does not contain an
information collection under the
Paperwork Reduction Act (44 U.S.C.
3501, et seq.). If a trustee wishes to
appeal a United States Trustee’s
decision, the trustee submits a request
for review to the Director detailing the
specific factual circumstances
supporting the trustee’s argument.
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Regulatory Flexibility Act
In accordancewith the Regulatory
Flexibility Act (5 U.S.C. 605(b)), the
Director has reviewed this rule and by
approving it certifies that it will not
have a significant economic impact on
a substantial number of small entities.
This certification is based upon the fact
that this rule does not impose any new
costs upon trustees that did not already
exist under the current administrative
review process. In addition, the costs of
compiling, photocopying and mailing
records are de minimis.
Unfunded Mandates Reform Act of
1995
This rule does not require the
preparation of an assessment statement
in accordance with the Unfunded
Mandates Reform Act of 1995, 2 U.S.C.
1531. This rule does not include a
federal mandate that may result in the
annual expenditure by State, local, and
tribal governments, in the aggregate, or
by the private sector, of more than the
annual threshold established by the Act
($100 million). Therefore, no actions
were deemed necessary under the
provisions of the Unfunded Mandates
Reform Act of 1995.
Small Business Regulatory Enforcement
Fairness Act of 1996
This rule is not a major rule as
defined by section 804 of the Small
Business Regulatory Enforcement
Fairness Act of 1996, 5 U.S.C. 801 et
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seq. This rule will not result in an
annual effect on the economy of $100
million or more; a major increase in
costs or prices; or significant adverse
effects on competition, employment,
investment, productivity, and
innovation; or on the ability of United
States-based companies to compete with
foreign-based companies in domestic
and export markets.
List of Subjects in 28 CFR Part 58
Administrative practice and
procedure, Bankruptcy, Credit and
debts.
Accordingly, for the reasons set forth
in the preamble, Part 58 of chapter I of
title 28 of the Code of Federal
Regulations is proposed to be amended
as follows:
PART 58—[AMENDED]
1. The authority citation for part 58
continues to read as follows:
Authority: 5 U.S.C. 301, 552; 11 U.S.C.
109(h), 111, 521(b), 727(a)(11), 1141(d)(3),
1202; 1302, 1328(g); 28 U.S.C. 509, 510, 586,
589b.
2. Add § 58.11 to read as follows:
§ 58.11 Procedures Governing
Administrative Review of a United States
Trustee’s Decision to Deny a Chapter 12 or
Chapter 13 Standing Trustee’s Claim of
Actual, Necessary Expenses.
(a) The following definitions apply to
§ 58.11 of this Part. These terms shall
have these meanings:
(1) The term ‘‘claim of actual,
necessary expenses’’ means the request
by a chapter 12 or chapter 13 standing
trustee for the United States Trustee’s
approval of the trustee’s projected
expenses for each fiscal year budget, or
for an amendment to the current budget
when an increase in an individual
expense line item is greater than both
10% of the budgeted amount and
$5,000.00. Expenses for certain items
require prior United States Trustee
approval regardless of amount;
(2) The term ‘‘Director’’ means the
person designated or acting as the
Director of the Executive Office for
United States Trustees;
(3) The term ‘‘final decision’’ means
the determination issued by the Director
based upon the review of the United
States Trustee’s decision to deny all or
part of a trustee’s claim of actual,
necessary expenses;
(4) The term ‘‘notice’’ means the
written communication from the United
States Trustee to a trustee that the
trustee’s claim of actual, necessary
expenses has been denied in whole or
in part;
(5) The term ‘‘request for review’’
means the written communication from
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41103
a trustee to the Director seeking review
of the United States Trustee’s decision
to deny, in whole or in part, the
trustee’s claim of actual, necessary
expenses;
(6) The term ‘‘trustee’’ means an
individual appointed by the United
States Trustee under 28 U.S.C. 586(b) to
serve as the standing trustee for chapter
12 or chapter 13 cases in a particular
region; and
(7) The term ‘‘United States Trustee’’
means, alternatively:
(i) The Executive Office for United
States Trustees;
(ii) A United States Trustee appointed
under 28 U.S.C. 581;
(iii) A person acting as a United States
Trustee;
(iv) An employee of a United States
Trustee; or
(v) Any other entity authorized by the
Attorney General to act on behalf of the
United States under this rule.
(b) The United States Trustee may
issue a decision to deny a trustee’s
claim of actual, necessary expenses.
Reasons for denial include, but are not
limited to, finding any of the following:
(1) The trustee failed to provide to the
United States Trustee sufficient
justification for the expense;
(2) The trustee failed to demonstrate
to the United States Trustee that the
expense is a cost effective use of funds;
(3) The trustee failed to demonstrate
to the United States Trustee that the
expense is reasonably related to the
duties of the trustee;
(4) The trustee failed to obtain
authorization from the United States
Trustee prior to making an expenditure
that was not provided for in the current
budget;
(5) The trustee failed to provide the
United States Trustee with documents,
materials, or other information
pertaining to the expense;
(6) The trustee failed to timely submit
to the United States Trustee accurate
budgets or requests for amendment of
budgets to cover the additional expense;
or
(7) The trustee failed to demonstrate
to the United States Trustee that the
expense is directly related to office
operations.
(c) Before issuing a notice of denial,
the United States Trustee shall
communicate in writing with the trustee
in an attempt to resolve any dispute
over a claim of actual, necessary
expenses:
(1) For disputes involving the
trustee’s projected expenses for the
upcoming fiscal year budget, the United
States Trustee shall either resolve the
dispute or issue a written notice of
denial no later than October 31 of the
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current calendar year, or, if the United
States Trustee has requested additional
information, 30 days from the deadline
for submission of the additional
information if such deadline is after
October 1, unless the trustee and United
States Trustee agree to a longer period
of time. Any projected expenses not
specifically disputed shall be approved
in the ordinary course and the trustee’s
fee shall be set on an interim basis;
(2) For disputes over amendments to
the current year budget, the United
States Trustee shall either resolve the
dispute or issue a written notice of
denial within 30 days of the trustee’s
amendment request, or, if the United
States Trustee has requested additional
information, 30 days from the deadline
for submission of the additional
information, unless the trustee and
United States Trustee agree to a longer
period of time. Any portion of the
amendment not specifically disputed
shall be approved in the ordinary
course;
(3) If the United States Trustee does
not resolve the dispute or issue a
written notice of denial within the timeframes identified in (c)(1) or (c)(2) of
this section, the trustee’s claim of
actual, necessary expenses shall be
deemed denied.
(d) The United States Trustee shall
notify a trustee in writing of any
decision denying a trustee’s claim of
actual, necessary expenses. The notice
shall state the reason(s) for the decision
and shall reference any documents or
communications relied upon in
reaching the decision. The United States
Trustee shall provide to the trustee
copies of any such non-privileged
documents that were not supplied to the
United States Trustee by the trustee.
The notice shall be sent to the trustee by
overnight courier, for delivery the next
business day.
(e) The notice shall advise the trustee
that the decision is final and
unreviewable unless the trustee requests
in writing a review by the Director no
later than 30 calendar days from the
date of the notice to the trustee.
(f) The decision to deny a trustee’s
claim of actual, necessary expenses
shall take effect upon the expiration of
a trustee’s time to seek review from the
Director or, if the trustee timely seeks
such review, upon the issuance of a
written final decision by the Director.
(g) The trustee’s request for review
shall be in writing and shall fully
describe why the trustee disagrees with
the United States Trustee’s decision,
and shall be accompanied by all
documents and materials the trustee
wants the Director to consider in
reviewing the United States Trustee’s
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decision. The trustee shall send the
original and one copy of the request for
review, including all accompanying
documents and materials, to the Office
of the Director by overnight courier, for
delivery the next business day. In order
to be timely, a request for review shall
be received at the Office of the Director
no later than 30 calendar days from the
date of the notice to the trustee. The
trustee shall also send a copy of the
request for review to the United States
Trustee by overnight courier, for
delivery the next business day.
(h) The United States Trustee shall
have 30 calendar days from the date of
the trustee’s request for review to
submit to the Director a written
response regarding the matters raised in
the trustee’s request for review. The
United States Trustee shall provide a
copy of this response to the trustee by
overnight courier, for delivery the next
business day.
(i) The Director may seek additional
information from any party, in the
manner and to the extent the Director
deems appropriate.
(j) In reviewing the decision to deny
a trustee’s claim of actual, necessary
expenses, the Director shall determine:
(1) Whether the decision is supported
by the record; and
(2) Whether the decision constitutes
an appropriate exercise of discretion.
(k) The Director shall issue a written
final decision no later than 90 calendar
days from the receipt of the trustee’s
request for review, or, if the Director has
requested additional information, 30
days from the deadline for submission
of the additional information, unless the
trustee agrees to a longer period of time.
The Director’s final decision on the
trustee’s request for review shall
constitute final agency action.
(l) In reaching a final decision the
Director may specify a person to act as
a reviewing official. The reviewing
official may not be under the
supervision of the United States Trustee
who denied the trustee’s claim of actual,
necessary expenses. The reviewing
official’s duties shall be specified by the
Director on a case-by-case basis, and
may include reviewing the record,
obtaining additional information from
the participants, providing the Director
with written recommendations, and
such other duties as the Director shall
prescribe in a particular case.
(m) This rule does not authorize a
trustee to seek review of any decision to
change maximum annual compensation,
to decrease or increase appointments of
trustees in a region or district, to change
the trustee’s percentage fee, or to
suspend, terminate, or remove a trustee.
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(n) A trustee must exhaust all
administrative remedies before seeking
redress in any court of competent
jurisdiction.
Dated: August 6, 2009.
Clifford J. White III,
Director, Executive Office for United States
Trustees.
[FR Doc. E9–19456 Filed 8–13–09; 8:45 am]
BILLING CODE 4410–40–P
ENVIRONMENTAL PROTECTION
AGENCY
40 CFR Part 52
[EPA–R09–OAR–2009–0474; FRL–8945–8]
Revisions to the California State
Implementation Plan
AGENCY: Environmental Protection
Agency (EPA).
ACTION: Proposed rule.
SUMMARY: EPA is proposing to approve
revisions to the San Joaquin Valley
Unified Air Pollution Control District
(SJVAPCD) portion of the California
State Implementation Plan (SIP). These
revisions concern oxides of nitrogen
(NOX) and particulate matter (PM)
emissions from boilers of various
capacities. We are approving local rules
that regulate these emission sources
under the Clean Air Act as amended in
1990 (CAA or the Act). We are taking
comments on this proposal and plan to
follow with a final action.
DATES: Any comments must arrive by
September 14, 2009.
ADDRESSES: Submit comments,
identified by docket number EPA–R09–
OAR–2009–0474, by one of the
following methods:
1. Federal eRulemaking Portal:
www.regulations.gov. Follow the on-line
instructions.
2. E-mail: steckel.andrew@epa.gov.
3. Mail or deliver: Andrew Steckel
(Air-4), U.S. Environmental Protection
Agency Region IX, 75 Hawthorne Street,
San Francisco, CA 94105–3901.
Instructions: All comments will be
included in the public docket without
change and may be made available
online at www.regulations.gov,
including any personal information
provided, unless the comment includes
Confidential Business Information (CBI)
or other information whose disclosure is
restricted by statute. Information that
you consider CBI or otherwise protected
should be clearly identified as such and
should not be submitted through
www.regulations.gov or e-mail.
www.regulations.gov is an ‘‘anonymous
access’’ system, and EPA will not know
E:\FR\FM\14AUP1.SGM
14AUP1
]]>Agencies
[Federal Register Volume 74, Number 156 (Friday, August 14, 2009)]
[Proposed Rules]
[Pages 41101-41104]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E9-19456]
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DEPARTMENT OF JUSTICE
28 CFR Part 58
[Docket No: EOUST 103]
RIN 1105-AB16
Procedures Governing Administrative Review of a United States
Trustee's Decision To Deny a Chapter 12 or Chapter 13 Standing
Trustee's Claim of Actual, Necessary Expenses
AGENCY: Executive Office for United States Trustees (``EOUST''),
Justice.
ACTION: Notice of proposed rulemaking.
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SUMMARY: This notice of proposed rulemaking (``rule'') sets forth the
procedures for a chapter 12 or chapter 13 standing trustee
(``trustee'') to obtain administrative review of a United States
Trustee's decision to deny a trustee's claim that certain expenses are
actual and necessary for the administration of bankruptcy cases.
Section 1231(b) of the Bankruptcy Abuse Prevention and Consumer
Protection Act of 2005 (``BAPCPA''), codified at 28 U.S.C. 586(e),
requires that: Trustees exhaust all administrative remedies pertaining
to a denial of a claim of actual, necessary expenses before seeking
judicial review; and the Attorney General prescribe procedures for
administrative review of such denials. This rule ensures that the
process for administratively reviewing a United States Trustee's denial
of a trustee's request for expenses is fair and effective.
DATES: Submit comments on or before October 13, 2009.
ADDRESSES: Comments on the rule may be submitted via https://www.regulations.gov, by telefax to (202) 307-2397, or by postal mail to
EOUST, 20 Massachusetts Ave., NW., 8th Floor, Washington, DC 20530. To
ensure proper handling of comments, please reference ``Docket No. EOUST
103--Trustee Expenses'' on all written and electronic correspondence.
FOR FURTHER INFORMATION CONTACT: Ramona D. Elliott, General Counsel, or
Larry Wahlquist, Office of General Counsel, at (202) 307-1399 (not a
toll-free number).
SUPPLEMENTARY INFORMATION:
Posting of Public Comments
Please note that all comments received are considered part of the
public record and made available for public inspection online at https://www.regulations.gov. Such information includes personal identifying
information (such as your name, address, etc.) voluntarily submitted by
the commenter. If you want to submit
[[Page 41102]]
personal identifying information (such as your name, address, etc.) as
part of your comment, but do not want it to be posted online, you must
include the phrase ``PERSONAL IDENTIFYING INFORMATION'' in the first
paragraph of your comment. You must also locate all the personal
identifying information you do not want posted online in the first
paragraph of your comment and identify what information you want
redacted.
If you want to submit confidential business information as part of
your comment but do not want it to be posted online, you must include
the phrase ``CONFIDENTIAL BUSINESS INFORMATION'' in the first paragraph
of your comment. You must also prominently identify confidential
business information to be redacted within the comment. If a comment
has so much confidential business information that it cannot be
effectively redacted, all or part of that comment may not be posted on
https://www.regulations.gov.
Personal identifying information and confidential business
information identified and located as set forth above will be placed in
the agency's public docket file, but not posted online. If you wish to
inspect the agency's public docket file in person by appointment,
please see the FOR FURTHER INFORMATION CONTACT paragraph. Comments
filed after the end of the comment period may be considered to the
extent feasible.
Discussion of Rule
The administration of all chapter 12 and 13 bankruptcy cases is
entrusted to private persons who are case or standing trustees under
the supervision and oversight of a regional United States Trustee. As
distinguished from case or standing trustees, United States Trustees
are employees of the Department of Justice. A standing trustee is
appointed by the United States Trustee under 28 U.S.C. 586 and
administers more than one chapter 13 or chapter 12 case, as opposed to
a case trustee who is appointed under 11 U.S.C. 1302 or 11 U.S.C. 1202
and who administers only the case to which the trustee is appointed.
This rule addresses the right, conferred by the Bankruptcy Abuse
Prevention and Consumer Protection Act of 2005 (``BAPCPA''), of a
standing trustee to obtain administrative review when the trustee's
request for projected expenses, referred to as a ``claim of actual,
necessary expenses'' in 28 U.S.C. 586(e)(3), is denied by the United
States Trustee.
When a debtor files for bankruptcy relief under chapter 12 or
chapter 13, the debtor proposes a plan to pay his or her creditors a
percentage of the amounts owed to creditors over a specified period of
time and obtains court approval of this plan. This process is termed
confirming a chapter 12 or chapter 13 plan. Once the bankruptcy court
confirms the plan, the trustee will oversee the payment of creditors
pursuant to the plan. The debtor pays plan payments to the trustee and
the trustee then disburses the appropriate amounts to creditors.
As part of the process of administering debtors' cases, a trustee
incurs expenses. A trustee is authorized to collect a specified
percentage of disbursed funds from debtors' plan payments to pay for
these expenses. However, before incurring expenses, a trustee obtains
approval from the United States Trustee. As the first step in obtaining
United States Trustee approval for expenses, the United States Trustee
requires that the trustee submit a budget for the anticipated expenses
for the fiscal year ending each September 30th. Next, these projected
expenses are evaluated by the United States Trustee who will either
approve the expenses or require modifications to the proposed budget.
Once the United States Trustee approves the trustee's budget, the
trustee is notified of this approval, and pursuant to 28 U.S.C. 586(e),
the trustee's compensation, and a specified percentage fee that the
trustee may collect from debtors' plan payments, is authorized. This
fee is to be used for payment of the approved expenses incurred during
the fiscal year.
When a trustee realizes that expenses for the current year might
exceed the approved amount, a trustee must submit a request to the
United States Trustee, and obtain approval, before incurring expenses
above the approved amount. This request must be submitted when the
increase to an individual expense line item is greater than both 10% of
the budgeted amount and $5,000.00. Expenses for certain items require
prior United States Trustee approval regardless of amount. These
expenses currently are increases in the amount budgeted for employee
expenses, increases in office lease obligations, payments to the
standing trustee or relative of the standing trustee, and expenses for
any item not originally contained in the approved budget. These
expenses are set forth in the Chapter 13 Trustee Handbook, which is
posted on the EOUST web site. If any other expenses are added to this
list, the United States Trustee will notify trustees via email or
regular mail at least 30 days before including the new expenses in a
revision to the Handbook.
If a trustee disagrees with the United States Trustee's denial of
the trustee's request for expenses, the trustee may seek administrative
review of the denial under the procedures identified in this rule. The
Director of the EOUST will conduct a de novo review of the United
States Trustee's decision to determine whether the record supports the
United States Trustee's decision and whether the decision was an
appropriate exercise of the United States Trustee's discretion or
contrary to law.
With the passage of BAPCPA, Congress directed the Attorney General
to prescribe procedures implementing administrative review for trustees
when a claim of actual, necessary expenses is denied. The Attorney
General delegated this authority to the Director, Executive Office for
United States Trustees. In response to this congressional mandate, the
Director publishes this rule, which establishes such procedures. This
rule imposes requirements only upon standing trustees who are
supervised by United States Trustees. In addition, this rule addresses
only the United States Trustee's denial of a trustee's claim of actual,
necessary expenses. This rule does not address the suspension or
termination of trustees. EOUST will publish another notice of proposed
rulemaking that addresses the suspension or termination of trustees
with a RIN number of 1105-AB12.
Executive Order 12866
This rule has been drafted and reviewed in accordance with
Executive Order 12866, ``Regulatory Planning and Review'' section 1(b),
The Principles of Regulation. This rule is not a ``significant
regulatory action'' as defined by Executive Order 12866 and,
accordingly, this rule has not been reviewed by the Office of
Management and Budget.
The Department has also assessed both the costs and benefits of
this rule as required by section 1(b)(6) and has made a reasoned
determination that the benefits of this regulation justify its costs.
The costs considered in this regulation include the costs for
prosecuting an administrative appeal of the United States Trustee's
denial of a trustee's claim of actual, necessary expenses. The
anticipated costs are the compiling, photocopying and mailing of the
requested records. However, none of these costs are new. This rule
simply codifies the current practice for obtaining administrative
review of the United States Trustee's decision.
The benefits of this rule include the codification of the process
for a trustee to obtain administrative review of the United States
Trustee's denial of a
[[Page 41103]]
trustee's claim of actual, necessary expenses. These benefits justify
its costs in complying with Congress' mandate to prescribe procedures
to implement 28 U.S.C. 586(e).
Executive Order 13132
This rule will not have a substantial direct effect on the States,
on the relationship between the national government and the States, or
on the distribution of power and responsibilities among the various
levels of government. Therefore, in accordance with Executive Order
13132, it is determined that this rule does not have sufficient
federalism implications to warrant the preparation of a Federalism
Assessment.
Paperwork Reduction Act
This rule does not contain an information collection under the
Paperwork Reduction Act (44 U.S.C. 3501, et seq.). If a trustee wishes
to appeal a United States Trustee's decision, the trustee submits a
request for review to the Director detailing the specific factual
circumstances supporting the trustee's argument.
Regulatory Flexibility Act
In accordancewith the Regulatory Flexibility Act (5 U.S.C. 605(b)),
the Director has reviewed this rule and by approving it certifies that
it will not have a significant economic impact on a substantial number
of small entities. This certification is based upon the fact that this
rule does not impose any new costs upon trustees that did not already
exist under the current administrative review process. In addition, the
costs of compiling, photocopying and mailing records are de minimis.
Unfunded Mandates Reform Act of 1995
This rule does not require the preparation of an assessment
statement in accordance with the Unfunded Mandates Reform Act of 1995,
2 U.S.C. 1531. This rule does not include a federal mandate that may
result in the annual expenditure by State, local, and tribal
governments, in the aggregate, or by the private sector, of more than
the annual threshold established by the Act ($100 million). Therefore,
no actions were deemed necessary under the provisions of the Unfunded
Mandates Reform Act of 1995.
Small Business Regulatory Enforcement Fairness Act of 1996
This rule is not a major rule as defined by section 804 of the
Small Business Regulatory Enforcement Fairness Act of 1996, 5 U.S.C.
801 et seq. This rule will not result in an annual effect on the
economy of $100 million or more; a major increase in costs or prices;
or significant adverse effects on competition, employment, investment,
productivity, and innovation; or on the ability of United States-based
companies to compete with foreign-based companies in domestic and
export markets.
List of Subjects in 28 CFR Part 58
Administrative practice and procedure, Bankruptcy, Credit and
debts.
Accordingly, for the reasons set forth in the preamble, Part 58 of
chapter I of title 28 of the Code of Federal Regulations is proposed to
be amended as follows:
PART 58--[AMENDED]
1. The authority citation for part 58 continues to read as follows:
Authority: 5 U.S.C. 301, 552; 11 U.S.C. 109(h), 111, 521(b),
727(a)(11), 1141(d)(3), 1202; 1302, 1328(g); 28 U.S.C. 509, 510,
586, 589b.
2. Add Sec. 58.11 to read as follows:
Sec. 58.11 Procedures Governing Administrative Review of a United
States Trustee's Decision to Deny a Chapter 12 or Chapter 13 Standing
Trustee's Claim of Actual, Necessary Expenses.
(a) The following definitions apply to Sec. 58.11 of this Part.
These terms shall have these meanings:
(1) The term ``claim of actual, necessary expenses'' means the
request by a chapter 12 or chapter 13 standing trustee for the United
States Trustee's approval of the trustee's projected expenses for each
fiscal year budget, or for an amendment to the current budget when an
increase in an individual expense line item is greater than both 10% of
the budgeted amount and $5,000.00. Expenses for certain items require
prior United States Trustee approval regardless of amount;
(2) The term ``Director'' means the person designated or acting as
the Director of the Executive Office for United States Trustees;
(3) The term ``final decision'' means the determination issued by
the Director based upon the review of the United States Trustee's
decision to deny all or part of a trustee's claim of actual, necessary
expenses;
(4) The term ``notice'' means the written communication from the
United States Trustee to a trustee that the trustee's claim of actual,
necessary expenses has been denied in whole or in part;
(5) The term ``request for review'' means the written communication
from a trustee to the Director seeking review of the United States
Trustee's decision to deny, in whole or in part, the trustee's claim of
actual, necessary expenses;
(6) The term ``trustee'' means an individual appointed by the
United States Trustee under 28 U.S.C. 586(b) to serve as the standing
trustee for chapter 12 or chapter 13 cases in a particular region; and
(7) The term ``United States Trustee'' means, alternatively:
(i) The Executive Office for United States Trustees;
(ii) A United States Trustee appointed under 28 U.S.C. 581;
(iii) A person acting as a United States Trustee;
(iv) An employee of a United States Trustee; or
(v) Any other entity authorized by the Attorney General to act on
behalf of the United States under this rule.
(b) The United States Trustee may issue a decision to deny a
trustee's claim of actual, necessary expenses. Reasons for denial
include, but are not limited to, finding any of the following:
(1) The trustee failed to provide to the United States Trustee
sufficient justification for the expense;
(2) The trustee failed to demonstrate to the United States Trustee
that the expense is a cost effective use of funds;
(3) The trustee failed to demonstrate to the United States Trustee
that the expense is reasonably related to the duties of the trustee;
(4) The trustee failed to obtain authorization from the United
States Trustee prior to making an expenditure that was not provided for
in the current budget;
(5) The trustee failed to provide the United States Trustee with
documents, materials, or other information pertaining to the expense;
(6) The trustee failed to timely submit to the United States
Trustee accurate budgets or requests for amendment of budgets to cover
the additional expense; or
(7) The trustee failed to demonstrate to the United States Trustee
that the expense is directly related to office operations.
(c) Before issuing a notice of denial, the United States Trustee
shall communicate in writing with the trustee in an attempt to resolve
any dispute over a claim of actual, necessary expenses:
(1) For disputes involving the trustee's projected expenses for the
upcoming fiscal year budget, the United States Trustee shall either
resolve the dispute or issue a written notice of denial no later than
October 31 of the
[[Page 41104]]
current calendar year, or, if the United States Trustee has requested
additional information, 30 days from the deadline for submission of the
additional information if such deadline is after October 1, unless the
trustee and United States Trustee agree to a longer period of time. Any
projected expenses not specifically disputed shall be approved in the
ordinary course and the trustee's fee shall be set on an interim basis;
(2) For disputes over amendments to the current year budget, the
United States Trustee shall either resolve the dispute or issue a
written notice of denial within 30 days of the trustee's amendment
request, or, if the United States Trustee has requested additional
information, 30 days from the deadline for submission of the additional
information, unless the trustee and United States Trustee agree to a
longer period of time. Any portion of the amendment not specifically
disputed shall be approved in the ordinary course;
(3) If the United States Trustee does not resolve the dispute or
issue a written notice of denial within the time-frames identified in
(c)(1) or (c)(2) of this section, the trustee's claim of actual,
necessary expenses shall be deemed denied.
(d) The United States Trustee shall notify a trustee in writing of
any decision denying a trustee's claim of actual, necessary expenses.
The notice shall state the reason(s) for the decision and shall
reference any documents or communications relied upon in reaching the
decision. The United States Trustee shall provide to the trustee copies
of any such non-privileged documents that were not supplied to the
United States Trustee by the trustee. The notice shall be sent to the
trustee by overnight courier, for delivery the next business day.
(e) The notice shall advise the trustee that the decision is final
and unreviewable unless the trustee requests in writing a review by the
Director no later than 30 calendar days from the date of the notice to
the trustee.
(f) The decision to deny a trustee's claim of actual, necessary
expenses shall take effect upon the expiration of a trustee's time to
seek review from the Director or, if the trustee timely seeks such
review, upon the issuance of a written final decision by the Director.
(g) The trustee's request for review shall be in writing and shall
fully describe why the trustee disagrees with the United States
Trustee's decision, and shall be accompanied by all documents and
materials the trustee wants the Director to consider in reviewing the
United States Trustee's decision. The trustee shall send the original
and one copy of the request for review, including all accompanying
documents and materials, to the Office of the Director by overnight
courier, for delivery the next business day. In order to be timely, a
request for review shall be received at the Office of the Director no
later than 30 calendar days from the date of the notice to the trustee.
The trustee shall also send a copy of the request for review to the
United States Trustee by overnight courier, for delivery the next
business day.
(h) The United States Trustee shall have 30 calendar days from the
date of the trustee's request for review to submit to the Director a
written response regarding the matters raised in the trustee's request
for review. The United States Trustee shall provide a copy of this
response to the trustee by overnight courier, for delivery the next
business day.
(i) The Director may seek additional information from any party, in
the manner and to the extent the Director deems appropriate.
(j) In reviewing the decision to deny a trustee's claim of actual,
necessary expenses, the Director shall determine:
(1) Whether the decision is supported by the record; and
(2) Whether the decision constitutes an appropriate exercise of
discretion.
(k) The Director shall issue a written final decision no later than
90 calendar days from the receipt of the trustee's request for review,
or, if the Director has requested additional information, 30 days from
the deadline for submission of the additional information, unless the
trustee agrees to a longer period of time. The Director's final
decision on the trustee's request for review shall constitute final
agency action.
(l) In reaching a final decision the Director may specify a person
to act as a reviewing official. The reviewing official may not be under
the supervision of the United States Trustee who denied the trustee's
claim of actual, necessary expenses. The reviewing official's duties
shall be specified by the Director on a case-by-case basis, and may
include reviewing the record, obtaining additional information from the
participants, providing the Director with written recommendations, and
such other duties as the Director shall prescribe in a particular case.
(m) This rule does not authorize a trustee to seek review of any
decision to change maximum annual compensation, to decrease or increase
appointments of trustees in a region or district, to change the
trustee's percentage fee, or to suspend, terminate, or remove a
trustee.
(n) A trustee must exhaust all administrative remedies before
seeking redress in any court of competent jurisdiction.
Dated: August 6, 2009.
Clifford J. White III,
Director, Executive Office for United States Trustees.
[FR Doc. E9-19456 Filed 8-13-09; 8:45 am]
BILLING CODE 4410-40-P
