Pattern of Violations, 5719-5729 [2011-2255]
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5719
Proposed Rules
Federal Register
Vol. 76, No. 22
Wednesday, February 2, 2011
This section of the FEDERAL REGISTER
contains notices to the public of the proposed
issuance of rules and regulations. The
purpose of these notices is to give interested
persons an opportunity to participate in the
rule making prior to the adoption of the final
rules.
DEPARTMENT OF LABOR
Mine Safety and Health Administration
30 CFR Part 104
RIN 1219–AB73
Pattern of Violations
Mine Safety and Health
Administration, Labor.
ACTION: Proposed rule; notice of close of
comment period.
AGENCY:
The Mine Safety and Health
Administration (MSHA) is proposing to
revise the Agency’s existing regulation
for pattern of violations (POV). MSHA
has determined that the existing
regulation does not adequately achieve
the intent of the Federal Mine Safety
and Health Act of 1977 (Mine Act) that
the POV provision be used to address
operators who have demonstrated a
disregard for the safety and health of
miners. Congress included the POV
provision in the Mine Act so that
operators would manage safety and
health conditions at mines and find and
fix the root causes of significant and
substantial (S&S) violations to protect
the safety and health of miners. The
proposal would simplify the existing
POV criteria, improve consistency in
applying the POV criteria, and more
adequately achieve the statutory intent.
It would also encourage chronic
violators to comply with the Mine Act
and MSHA’s safety and health
standards.
SUMMARY:
MSHA must receive comments
by midnight Eastern Standard Time on
April 4, 2011.
ADDRESSES: Comments must be
identified with ‘‘RIN 1219–AB73’’ and
may be sent to MSHA by any of the
following methods:
• Federal E-Rulemaking Portal:
https://www.regulations.gov. Follow the
on-line instructions for submitting
comments.
• Electronic mail:
zzMSHAcomments@dol.gov. Include
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DATES:
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‘‘RIN 1219–AB73’’ in the subject line of
the message.
• Facsimile: 202–693–9441. Include
‘‘RIN 1219–AB73’’ in the subject line of
the message.
• Regular Mail: MSHA, Office of
Standards, Regulations, and Variances,
1100 Wilson Boulevard, Room 2350,
Arlington, Virginia 22209–3939.
• Hand Delivery or Courier: MSHA,
Office of Standards, Regulations, and
Variances, 1100 Wilson Boulevard,
Room 2350, Arlington, Virginia. Sign in
at the receptionist’s desk on the 21st
floor.
Information Collection Requirements:
Comments concerning the
information collection requirements of
this proposed rule must be clearly
identified with ‘‘RIN 1219–AB73’’ and
sent to both the Office of Management
and Budget (OMB) and MSHA.
Comments to OMB may be sent by mail
addressed to the Office of Information
and Regulatory Affairs, Office of
Management and Budget, New
Executive Office Building, 725 17th
Street, NW., Washington, DC 20503,
Attn: Desk Officer for MSHA. Comments
to MSHA may be transmitted by any of
the methods listed above in this section.
FOR FURTHER INFORMATION CONTACT:
April E. Nelson, Acting Director, Office
of Standards, Regulations, and
Variances, MSHA, at
nelson.april@dol.gov (e-mail); 202–693–
9440 (voice); or 202–693–9441
(facsimile).
SUPPLEMENTARY INFORMATION:
Table of Contents
I. Introduction
II. Background and Regulatory History
III. Section-by-Section Analysis
IV. Preliminary Regulatory Economic
Analysis
V. Feasibility
VI. Regulatory Flexibility Analysis and Small
Business Regulatory Enforcement
Fairness Act (SBREFA)
VII. Paperwork Reduction Act of 1995
VIII. Other Regulatory Considerations
IX. References
I. Introduction
Availability of Information
Public Comments: MSHA will post all
comments on the Internet without
change, including any personal
information provided. Access comments
electronically at https://www.msha.gov/
regsinfo.htm. Review comments in
person at the Office of Standards,
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Regulations, and Variances, 1100
Wilson Boulevard, Room 2350,
Arlington, Virginia. Sign in at the
receptionist’s desk on the 21st floor.
E-mail notification: MSHA maintains
a list that enables subscribers to receive
e-mail notification when the Agency
publishes rulemaking documents in the
Federal Register. To subscribe, go to
https://www.msha.gov/subscriptions/
subscribe.aspx.
Information Collection Supporting
Statement: A copy of the information
collection package can be obtained from
the Department of Labor by electronic
mail request to Michel Smyth at
smyth.michel@dol.gov or by phone
request to 202–693–4129.
II. Background and Regulatory History
A. Statutory Provision
In enacting the Mine Act, Congress
included the pattern of violations (POV)
provision in section 104(e) to provide
MSHA with an additional enforcement
tool to protect miners when the operator
demonstrated a disregard for the safety
and health of miners. The need for such
a provision was forcefully demonstrated
during the investigation of the Scotia
Mine disaster, which occurred in 1976
in Eastern Kentucky. (S. Rep. No. 181,
95th Cong., 1st Sess. at 32.) As a result
of explosions on March 9 and 11, 1976,
caused by dangerous accumulations of
methane, 23 miners and three mine
inspectors lost their lives. The Scotia
Mine had a chronic history of persistent,
serious violations that were cited over
and over by MSHA. After abating the
violations, the operator would permit
the same violations to recur, repeatedly
exposing miners to the same hazards.
The accident investigation showed that
MSHA’s then-existing enforcement
program was unable to address the
Scotia Mine’s history of recurring
violations.
The Mine Act places the ultimate
responsibility for ensuring the safety
and health of miners on mine operators.
The legislative history of the Mine Act
emphasizes that Congress reserved the
POV provision for mine operators with
a record of repeated S&S violations.
Congress intended the POV sanction to
attain remedial action from operators
‘‘who have not responded to the
Agency’s other enforcement efforts.’’ (55
FR 31129) The legislative history states
that Congress believed that the existence
of a pattern would signal to both the
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mine operator and the Secretary that
‘‘there is a need to restore the mine to
effective safe and healthful conditions
and that the mere abatement of
violations as they are cited is
insufficient.’’ (S. Rep. No. 181, supra at
33.)
The Mine Act does not define ‘‘pattern
of violations,’’ but section 104(e)(4)
authorizes the Secretary to establish
criteria for determining when a pattern
of violations of mandatory safety or
health standards exists. Congress
provided the Secretary with broad
discretion in establishing pattern
criteria, recognizing that MSHA may
need to modify the criteria as
experience dictates.
B. Regulatory History
MSHA first proposed a POV
regulation in 1980 (45 FR 54656). That
proposal included: Purpose and scope,
initial screening, pattern criteria,
issuance of notice, and termination of
notice. Commenters were generally
opposed to the 1980 proposal. They
stated that the proposal was complex,
too statistically oriented, overbroad, and
vague. In addition, they stated that the
rulemaking was untimely because of
litigation then pending before the
Federal Mine Safety and Health Review
Commission (Commission) concerning
MSHA’s interpretation of the S&S
provisions of the Mine Act. Commenters
also stated that review of the Agency’s
then pending regulation for assessment
of civil penalties could affect the POV
proposal.
On February 8, 1985 (50 FR 5470),
MSHA announced its withdrawal of the
1980 proposed rule and issued an
advance notice of proposed rulemaking
(ANPRM) that addressed many of the
concerns expressed about the 1980
proposal. In the 1985 ANPRM, MSHA
stated that it intended to focus on the
safety and health record of each mine
rather than on a strictly quantitative
comparison of mines to industry-wide
norms. In the ANPRM, MSHA stated
that the Agency envisioned simplified
criteria, focusing on two principal areas:
(1) Were S&S violations common to a
particular hazard or did S&S violations
throughout the mine represent an
underlying health and safety problem,
and
(2) Is the mine on a section 104(d)
unwarrantable failure sequence,
indicating that other enforcement
measures had been ineffective.
MSHA requested suggestions for
additional factors the Agency should
use in determining whether a POV
exists and requested ideas on
administrative procedures for
terminating a pattern notice.
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MSHA published a second proposed
rule on May 30, 1989 (54 FR 23156),
which included criteria and procedures
for identifying mines with a pattern of
S&S violations. The 1989 proposal
included procedures for initial
identification of mines developing a
pattern of violations; criteria for
determining whether a pattern of
violations exists at a mine; notification
procedures that would provide both the
mine operator and miners’
representative an opportunity to
respond to the Agency’s evaluation that
a pattern of violations may exist; and
procedures for terminating a pattern
notice. The 1989 proposal addressed the
major issues raised by commenters.
Commenters’ primary concerns were
MSHA’s policies for enforcing the S&S
provisions of the Mine Act, the civil
penalty regulation, and MSHA’s
enforcement of the unwarrantable
failure provision of the Mine Act.
MSHA held two public hearings and
issued a final rule on July 31, 1990 (55
FR 31128).
The existing rule established MSHA’s
criteria and procedures for identifying
mines with a POV. The existing rule
reflected MSHA’s belief that Congress
intended the POV sanction to be
directed at restoring mines to a safe and
healthful condition.
Until mid-2007, POV screening was
decentralized and lacked a consistent,
structured approach. MSHA District
offices were responsible for conducting
the required annual POV screening of
mines. Following the accidents at the
Sago, Darby, and Aracoma mines in
early 2006, MSHA began developing a
centralized, quantifiable POV screening
process. MSHA initiated its newly
developed Pattern of Violations
Screening Criteria and Scoring Model in
mid-2007 and updated and revised the
screening criteria and procedures in
2010. MSHA uses a computer program
based on this screening criteria and
scoring model to generate lists of mines
with a potential pattern of violations
(PPOV).
III. Section-by-Section Analysis
MSHA is proposing the following
changes to its existing pattern of
violations regulation.
A. Section 104.1 Purpose and Scope
Proposed § 104.1 would provide the
purpose and scope of the proposal and
is unchanged from the existing
provision.
B. Section 104.2 Pattern Criteria
Proposed § 104.2 would combine
existing §§ 104.2 and 104.3. It would
specify the general criteria that MSHA
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would use to identify mines with a
pattern of violations. MSHA would
review compliance, accident, injury,
and illness records. MSHA believes that
the proposed rule would simplify the
process for determining whether a mine
has a pattern of violations and would
more accurately reflect the statutory
intent. Consistent with the Mine Act,
the proposed rule would eliminate all
references to initial screening criteria.
Proposed § 104.2(a) would provide
that the specific criteria (e.g., number of
S&S violations issued in the previous
year) used in the review to identify
mines with a pattern of S&S violations
would be posted on MSHA’s website at
https://www.msha.gov. MSHA requests
specific comments on how the agency
should obtain comment during the
development of, and periodic revision
to, the POV screening criteria. MSHA
also requests comments on the best
methods for notifying mine operators of
changes to these criteria. Under the
proposal, MSHA would review:
(1) Citations for significant and
substantial violations;
(2) Orders under section 104(b) of the
Act for not abating significant and
substantial violations;
(3) Citations and withdrawal orders
under section 104(d) of the Act,
resulting from the operator’s
unwarrantable failure to comply;
(4) Imminent danger orders under
section 107(a) of the Act;
(5) Orders under section 104(g) of the
Act requiring withdrawal of miners who
have not received training and who the
inspector declares to be a hazard to
themselves and others;
(6) Enforcement measures, other than
section 104(e) of the Act, which have
been applied at the mine;
(7) Other information that
demonstrates a serious safety or health
management problem at the mine, such
as accident, injury, and illness records;
and
(8) Mitigating circumstances.
MSHA believes that posting the
specific criteria and compliance data
that the Agency would use on the
website would allow mine operators to
monitor their compliance record against
the proposed POV criteria. Some mines
have personnel who, currently, are
requesting this information from MSHA.
This website would reduce the effort for
these mine operators. Access to this
information through a searchable
database would provide operators an
opportunity to evaluate their record and
determine whether they are approaching
proposed POV criteria levels. This
would enable operators to proactively
implement measures to improve safety
and health at their mines and to bring
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their mines into compliance. Posting the
specific pattern criteria on MSHA’s
website will promote openness and
transparency and encourage operators to
examine their compliance record more
closely, ascertain whether they have any
recurring problems, and enhance the
safety and health of miners. MSHA
believes that sharing this information
facilitates a more proactive approach to
safety and health on the part of all
involved with miner safety and health.
In addition, MSHA believes that the
ready availability of compliance data
will eliminate the need to inform
operators of a potential pattern of
violations (PPOV). MSHA believes that
this is an improvement over the existing
process because it allows operators to
continually evaluate their compliance
performance.
Under proposed § 104.2(a)(1), like the
existing provision, MSHA would
consider a mine’s S&S violations.
Like the existing provision, proposed
§ 104.2(a)(2) would require MSHA to
consider closure orders issued under
section 104(b) of the Mine Act that
resulted from S&S violations.
Proposed § 104.2(a)(3), like existing
§ 104.3(a)(3), would require MSHA to
consider unwarrantable failure citations
and withdrawal orders issued under
sections 104(d)(1) and (d)(2) of the Mine
Act. Unwarrantable failure citations and
orders often constitute S&S violations
that are the types of serious, repeated
violations that Congress intended to
address in a POV regulation.
Proposed § 104.2(a)(4), like existing
§ 104.2(a)(3), would require MSHA to
consider imminent danger withdrawal
orders issued under section 107(a) of the
Mine Act.
Proposed § 104.2(a)(5), derived from
existing § 104.2(b)(1), would require
MSHA to consider orders issued under
section 104(g) of the Act.
Proposed § 104.2(a)(6), like existing
§ 104.2(b)(1), would require that MSHA
consider enforcement measures other
than section 104(e) of the Act, which
have been applied at the mine.
Proposed § 104.2(a)(7) would clarify
MSHA’s intent that the proposed POV
criteria include consideration of
operations with serious safety and
health management problems. It is
derived from the existing regulation and
the legislative history of the Mine Act.1
It would require MSHA to consider
other information, such as accident,
injury, and illness records, that may
reveal a serious safety or health
1 The Committee views the 105(d)(1) [now 104(e)]
notice as indicating to both the mine operator and
the Secretary that there exists at mine a serious
safety and health management problem. (Legislative
History, Committee Report, p. 620).
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management problem at a mine. This
other information may also include:
Enforcement measures, other than POV,
applied at the mine; evidence of the
operator’s lack of good faith in
correcting the problem that results in
repeated S&S violations; repeated S&S
violations of a particular standard;
repeated S&S violations of standards
related to the same hazard; and any
other relevant information. This is
essentially the same information
addressed in existing §§ 104.2(b)(2) to
(b)(3) and 104.3(a)(1) and (a)(2). In
addition, in making a determination
under this aspect of the proposal,
MSHA would consider: knowing and
willful S&S violations; citations and
orders issued in conjunction with an
accident, including orders under
sections 103(j) and (k) of the Mine Act;
and S&S violations of safety and health
standards that contribute to the cause of
accidents and injuries. MSHA data and
experience show that violations of
approval, training, or recordkeeping
regulations, for example, can
significantly and substantially
contribute to safety or health hazards.
This is especially true where the mine
operator allows similar violations to
occur repeatedly.
Under proposed § 104.2(a)(8), like
existing § 104.2(b)(4), MSHA would
consider mitigating circumstances.
Under this proposed provision, MSHA
would consider the causes of repeated
violations that may be beyond the
operator’s control, such as changes in
mine ownership or mine management,
and whether conditions at the mine
show a trend of significant
improvement.
Under this proposed provision and
consistent with the legislative history,
MSHA would allow operators to take
proactive measures to bring their mines
into compliance. For example, operators
who compare their compliance record
with the POV criteria and determine
that they are approaching a pattern of
violations level may work with MSHA
to bring their mines into compliance to
avoid a POV notice. Under the proposal,
an operator may submit a written safety
and health management program to the
District Manager for approval. To obtain
approval, operators should structure
safety and health management programs
so that MSHA can determine whether
the program’s parameters would result
in meaningful, measurable, and
significant reductions in S&S violations.
The operator should develop a process
and program with measurable
benchmarks for abating specific
violations that could lead to a POV and
addressing these hazardous conditions
at their mines. Using these benchmarks,
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operators would be able to use the
MSHA database accessible through the
Agency’s Web site to monitor their
safety and health record. Under the
proposal, MSHA would consider an
operator’s effective implementation of
an MSHA-approved safety and health
management program as a mitigating
circumstance.
The proposed rule would eliminate
the existing requirement in § 104.3(b)
that only citations and orders that have
become final are to be used to identify
mines with a potential pattern of
violations. This proposal is consistent
with the language of section 104(e), the
legislative history of the Mine Act, and
the purpose of section 104(e). In
explaining the need for the POV
enforcement tool, Congress pointed out
that ‘‘the Scotia mine, as well as other
mines, had an inspection history of
recurrent violations, some of which
were tragically related to the disasters,
which the existing enforcement scheme
was unable to address.’’ (S. Rep. No.
181, 95th Cong., 1st Sess. at 32.) The use
of the phrase ‘‘inspection history’’
indicates Congress’ intent that POV
determinations be based on inspection
histories, i.e., violations found by
MSHA during inspections, rather than
only on final citations and orders.
The Senate Report specifically noted
similarities between sections 104(d) and
104(e) of the Mine Act and stated that
the POV ‘‘sequence parallels the current
unwarrantable failure sequence.’’
(S. Rep. No. 181, supra, at 33.) This
reflects Congress’s intent that POV
determinations, like section 104(d)(1)
and (d)(2) determinations, need not be
final orders. In addition, the Senate
Report stated that it was ‘‘* * * the
Committee’s intention that the Secretary
or his authorized representative [] have
both [Section 104(d) and Section 104(e)]
enforcement tools available, and that
they [] be used simultaneously if the
situation warrants.’’ (Id at 34.) The
proposal to consider non-final citations
and orders to identify mines with a POV
is consistent with the Mine Act.
The existing provision limiting
MSHA’s consideration of citations and
orders to those that are final restricts
MSHA’s ability to achieve the purpose
of the POV provision, consistent with
Congressional intent. As stated in the
Mine Act and its legislative history, the
Secretary is given broad discretion to
‘‘make such rules as [she] deems
necessary to establish criteria for
determining when a pattern of
violations’’ exists. (30 U.S.C. 814(e)(4))
Congress stated that the Secretary
should ‘‘continually evaluate and
modify the pattern of violations criteria
as she deems necessary.’’ (S. Rep. No.
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181, supra at 33.) MSHA’s experience
with enforcing section 104(e) has led the
Agency to conclude that it is necessary
to modify the final order criteria in its
existing POV regulation.
In November 2010, there was a
backlog of approximately 88,000
contested violations pending before the
Commission. For cases disposed during
November, 2010, it took, on average, 518
days for contested violations to become
final. For a mine with contested
citations and orders that have not
become final, the final order provision
does not allow MSHA to review the
mine’s complete recent compliance
history when assessing whether a POV
exists and hinders MSHA’s ability to
effectively enforce section 104(e) of the
Mine Act. It can allow chronic violators
to avoid or delay the POV sanction and
to continue their repeated pattern of
noncompliance with health and safety
standards, without correcting the
underlying problem. The final order
provision in the existing regulation
provides an incentive for operators to
contest S&S violations to avoid being
placed under a POV.
The fact that the Mine Act requires an
operator to abate a hazard prior to
contesting a violation provides further
support for the proposed rule. Mine
operators must correct the hazardous
condition within the time set by the
MSHA inspector, even if they challenge
the violation. The proposal to eliminate
the existing requirement that only final
orders be used for POV determination
would greatly enhance safety and health
of miners. Fewer than one percent of
citations are reversed. Over 700,000
violations were assessed civil penalties
that became final orders during the fiveyear period 2006 through 2010, with
3,400 vacated after they were contested.
During the same timeframe, 6,000 of the
contested violations were modified from
S&S to non-S&S.
Proposed § 104.2(b) would increase
the frequency of MSHA’s review of a
mine for a POV from at least once per
year under the existing regulation to at
least twice per year. MSHA determined
that an annual review would not
adequately allow the Agency to identify
mines with recurring S&S violations.
The increased frequency of review
would allow MSHA to more promptly
identify mines with recurring S&S
violations and take appropriate action.
This proposal would also encourage
operators to more closely examine their
compliance records to determine
whether greater efforts are necessary to
comply with the Mine Act and MSHA’s
standards and regulations.
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C. Section 104.3
Issuance of Notice
Proposed § 104.3, renumbered from
existing § 104.4, would simplify the
requirements for issuing a POV notice.
Proposed § 104.3(a) is similar to
existing § 104.4(a). The proposal would
provide that, when a mine has a POV,
the District Manager will issue a POV
notice to the mine operator that
specifies the basis for the Agency’s
action. The District Manager will also
provide a copy of the POV notice to the
representative of miners. The proposed
provision would delete all references to
a PPOV; otherwise it is essentially
unchanged from the existing
requirement.
MSHA believes that this proposed
action would allow the Agency to more
effectively implement the POV
provision in the Mine Act, consistent
with legislative intent. MSHA’s
experience and data reveal that over the
past 3 years, mine operators who
received a PPOV letter reduced their
S&S violations by at least 30 percent. In
this same period, 6 of 62 operators
received more than one PPOV letter.
These mine operators temporarily
reduced their S&S violations, but
reverted back to allowing the same
hazards to occur again and again
without addressing the underlying
causes.
Proposed § 104.3(b), essentially the
same as existing § 104.4(d), would
require that the mine operator post a
copy of the POV notice on the mine
bulletin board and that the notice
remain posted until MSHA terminates
the POV notice. Existing § 104.4(d)
requires the operator to post all
notifications issued under 30 CFR part
104 at the mine. The proposal would
clarify that the operator post
notifications issued under this part on
the mine bulletin board.
Proposed § 104.3(c) is a new provision
that would restate the intent of the Mine
Act when a POV notice is issued. It
essentially restates section 104(e)(1) of
the Mine Act and would require MSHA
to issue an order withdrawing all
persons from the affected area of the
mine if an authorized representative of
the Secretary finds any S&S violation
within 90 days after the issuance of the
POV notice. No one would be allowed
to enter the area affected by the
violation until the condition has been
abated, except those persons referred to
in section 104(c) of the Mine Act who
must enter the affected area to correct
the violation.
Proposed § 104.3(d) is a new
provision that would specifically restate
the intent of the Mine Act when a POV
notice is issued. It would provide that
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if a withdrawal order is issued under
proposed § 104.3(c), any subsequent
S&S violation will result in an order
withdrawing all persons from the
affected area of the mine until the
authorized representative of the
Secretary determines that the violation
has been abated, except those persons
identified in section 104(c) of the Mine
Act.
D. Section 104.4
Termination of Notice
Proposed § 104.4, renumbered from
existing § 104.5, addresses the
termination of a POV notice and
continues to provide that a POV notice
will be terminated if MSHA finds no
S&S violations during an inspection of
the entire mine, or if no withdrawal
order for S&S violations under section
104(e)(1) of the Mine Act has been
issued within 90 days of the issuance of
the POV notice. MSHA’s Pattern of
Violations (POV) Procedures Summary,
posted on MSHA’s website, also
includes requirements for MSHA to
conduct a complete inspection of the
entire mine within 90 days of issuing
the POV notice. The Procedures
Summary states, in part, the following:
Following notification to the operator of
the issuance of a Notice of Pattern of
Violations, the District Manager shall initiate
appropriate inspection activities to ensure
that the mine is inspected in its entirety
during the following 90-day period and each
succeeding inspection cycle until the POV
notice is terminated.
Proposed § 104.4(b), renumbered from
existing § 104.5(b), is unchanged.
IV. Preliminary Regulatory Economic
Analysis
A. Executive Order 12866: Regulatory
Planning and Review
Under Executive Order (E.O.) 12866,
the Agency must determine whether a
regulatory action is ‘‘significant’’ and
subject to review by the Office of
Management and Budget (OMB).
Section 3(f) of E.O. 12866 defines a
‘‘significant regulatory action’’ as an
action that is likely to result in a rule:
(1) Having an annual effect on the
economy of $100 million or more, or
adversely and materially affecting a
sector of the economy, productivity,
competition, jobs, the environment,
public health or safety, or state, local, or
tribal governments or communities (also
referred to as ‘‘economically
significant’’); (2) creating serious
inconsistency or otherwise interfering
with an action taken or planned by
another agency; (3) materially altering
the budgetary impacts of entitlements,
grants, user fees, or loan programs or the
rights and obligations of recipients
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thereof; or (4) raising novel legal or
policy issues arising out of legal
mandates, the President’s priorities, or
the principles set forth in this Executive
Order.
MSHA has determined that this
proposed rule would not have an annual
effect of $100 million or more on the
economy, and is not an economically
‘‘significant regulatory action’’ pursuant
to section 3(f) of E.O. 12866. However,
the proposed rule is a ‘‘significant’’
regulatory action because it would
likely raise novel legal or policy issues.
MSHA requests comments on the
estimates of costs and benefits presented
in this proposed rule.
MSHA has not prepared a separate
preliminary regulatory economic
analysis for this rulemaking. Rather, the
analysis is presented below.
B. Industry Profile and Population at
Risk
The proposed rule applies to all
mines in the United States. MSHA
divides the mining industry into two
major sectors based on commodity: (1)
coal mines and (2) metal and nonmetal
mines. Each sector is further divided by
type of operation, e.g., underground
mines or surface mines. The Agency
maintains data on the number of mines
and on mining employment by mine
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type and size. MSHA also collects data
on the number of independent
contractor firms and their employees.
Each independent contractor is issued
one MSHA contractor identification
number, but may work at any mine.
For the 12 months ending January
2010, the average number of mines in
operation was 14,100. These mines
employed 297,000 miners, including
contract workers and excluding office
workers. There were 8,770 mine
contractor firms with 88,000 employees,
excluding office workers. Table IV–1
presents the total number of all mines
and miners, by size of mine.
TABLE IV–1—AVERAGE 2009 NUMBER OF MINES AND EMPLOYMENT (EXCLUDING OFFICE EMPLOYEES),
BY EMPLOYMENT SIZE
Size of mine
Employment at all
mines, excluding office
employees
All mines
1–19 Employees ......................................................................................................................
20–500 Employees ..................................................................................................................
501+ Employees ......................................................................................................................
Contractors ..............................................................................................................................
11,816
2,234
48
56,489
123,181
29,402
87,740
Total ..................................................................................................................................
14,098
296,812
The estimated value of coal produced
in U.S. coal mines in 2009 was $35.7
billion of which $18.5 billion was from
underground coal and $17.2 billion
from surface coal. The value of coal was
estimated from the amount of coal
produced and the price of coal. MSHA
obtained the coal production estimates
from the Agency’s MSIS system and the
price per ton for coal from the
Department of Energy (DOE), Energy
Information Administration (EIA),
Annual Coal Report 2009, October 2010,
Table 28.
The value of the U.S. mining
industry’s metal and nonmetal (M/NM)
output in 2009 was estimated to be
approximately $57.1 billion. Metal
mining contributed an estimated $21.3
billion to the total while the nonmetal
mining sector contributed an estimated
$35.8 billion. The value of production
estimates are from U.S. Department of
the Interior (DOI), U.S. Geological
Survey (USGS), Mineral Commodity
Summaries 2010, January 2010, page 8.
The combined value of production
from all U.S. mines in 2009 was $92.8
billion. Table IV–2 presents the
estimated revenues for all mines, by size
of mine.
TABLE IV–2—REVENUES AT ALL MINES, BY EMPLOYMENT SIZE, IN 2009
Revenues at all mines
(million dollars)
Size of mine
1–19 Employees ..................................................................................................................................................................
20–500 Employees ..............................................................................................................................................................
501+ Employees ..................................................................................................................................................................
$17,450
54,478
20,856
Total ..............................................................................................................................................................................
92,784
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C. Benefits
Although MSHA does not have an
historical basis from which to estimate
the effects of placing a mine on a pattern
of violations (POV), the Agency does
have some experience with issuing
potential pattern of violations (PPOV)
notifications to operators. MSHA’s data
reveal that although most mine
operators significantly improve health
and safety conditions at their mines
after receiving the PPOV notification,
many later experienced both a decline
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in health and safety and an increase in
S&S violations.
During June 2007 through September
2009, MSHA made PPOV evaluations on
an average of every six to nine months.
During that period, MSHA sent 68
PPOV notification letters to 62 mine
operators (6 operators received more
than one notification). After receiving
the notification letter, of the mines that
remained in operation to the next
evaluation, 94 percent reduced the rate
of S&S citations and orders by at least
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30 percent and 77 percent reduced the
rate of S&S citations and orders to levels
at or below the national average for
similar mines. However, as discussed
previously in the preamble,
improvements at some mines declined
over time. Of the 62 mine operators that
received PPOV notification letters
during the review period, 6 received a
second PPOV notification letter. In
addition to the 6 mines that received
two letters, 7 mines were identified in
more than one evaluation as meeting the
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PPOV criteria but were only sent one
letter generally due to mitigating
circumstances. Compliance at 13 of the
62 mines that received PPOV
notification letters (21 percent)
deteriorated such that each of these
mines either was sent or could have
been sent a second letter.
Under the existing rule, MSHA
identifies mines that meet the screening
criteria for PPOV. MSHA conducts a
review to determine if there are
mitigating circumstances and issues
PPOV notification letters as appropriate.
The proposed rule would delete the
screening process as well as all
references to a PPOV.
The proposed rule would establish
general criteria that MSHA would use to
identify mines with a pattern of S&S
violations. MSHA would post specific
criteria that MSHA would use in making
POV determinations, including a
searchable database of mine operator
compliance information, on the
Agency’s website. Operators would be
able to use the specific criteria and the
information in the database to
continually monitor their safety and
health performance and determine
whether they are approaching proposed
POV criteria levels.
Under the proposed rule, MSHA
would allow operators to take proactive
measures to bring their mines into
compliance. MSHA would consider an
operator’s effective implementation of
an MSHA-approved safety and health
management program as a mitigating
circumstance when it comes to placing
a mine on a POV.
Under the proposed rule, MSHA
projects that operators would
continually monitor their performance
and, if they believe that they are
approaching a POV, would take action
to improve their safety and health
performance. MSHA projects that, under
the proposed rule, most mine operators
who see that their mines are close to a
POV would institute an MSHAapproved safety and health management
program to lessen the probability of
being placed on a POV and the
possibility of being issued closures.
MSHA projects that this would result in
more mines taking action than those
issued PPOV notifications under the
existing procedure.
Closure orders can have a substantial
impact on the ability of a mine to
conduct its business. The threat of
closure provides a strong incentive for
operators to ensure that S&S violations
do not recur. MSHA projects that few
operators would risk such an
occurrence.
MSHA projects that under the
proposal, which would increase the
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frequency of MSHA’s review of a mine
for a POV from once to twice per year,
on average, approximately 50 mine
operators per year would submit a safety
and health management program to
MSHA for approval as a mitigating
circumstance. Under the proposed rule,
MSHA would allow operators to take
proactive measures to bring their mines
into compliance with MSHA standards
and regulations, reducing the
probability of these mines being on a
POV. MSHA further projects that an
average of approximately 10 mines per
year (i.e., those that would not take
proactive action, such as instituting an
MSHA-approved safety and health
management program) would be issued
POV notifications. MSHA requests
comments on these estimates which are
likely to vary from year to year.
MSHA used the Agency’s experience
with PPOV notification letters to
estimate the impact that the proposed
mitigating circumstance provision
(including the opportunity for operators
to submit safety and health management
programs) would have on the number of
nonfatal injuries at mines. MSHA
determined that 62 mines which
received PPOV notification letters (6
received two notifications) during the
June 2007 through September 2009
period experienced, on average, 11
nonfatal injuries during the year prior to
receiving the letter and eight nonfatal
injuries during the year after receiving
the letter. MSHA used the one year
period before and after PPOV
notification as a basis for comparison
because, as was previously noted,
improvements at some mines declined
over time and because a longer period
was not available for some mines (i.e.,
mines that were issued PPOV
notifications in September 2009).
Based on the projection that 50 mines
per year would average three fewer
nonfatal injuries in the first year after
implementing an MSHA-approved
safety and health management program,
MSHA projects that the number of
nonfatal injuries would be reduced by a
minimum of 150 (50 mines × 3 nonfatal
injuries per mine) per year. MSHA
believes that this is a low estimate for
the following reasons:
• It is likely that including
measurable benchmarks for abating
specific violations and addressing
hazardous conditions in the MSHAapproved safety and health management
programs would make these programs
more effective than the measures that
recipients of the PPOV notification
letters have historically instituted.
• The estimate does not include any
reductions in the number of fatalities.
Because mine fatalities occur on a less
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frequent basis than do injuries, the
Agency does not believe that it has a
reliable basis upon which to project a
reduction in fatalities. However, the
Agency believes that the
implementation of an MSHA-approved
safety and health management program
would reduce fatalities.
• The estimate does not include any
projected improvement at the 10 mines
that would not institute an MSHAapproved safety and health management
program and would be placed on a POV.
However, due to the high threshold for
getting off a POV under the proposed
rule, there would likely be injury
reductions for this category.
MSHA also anticipates longer lasting
improvements under the proposed rule.
Of the 62 mines that received PPOV
notification letters from June 2007
through September 2009, 13 did not
have a full second year of data following
receipt of the PPOV notification letter.
Of the 49 mines that had two full years
of data following receipt of the PPOV
notification letter, 19 (39%) experienced
an increase in the number of injuries in
the second year following receipt of the
PPOV notification letter compared to
the first. MSHA believes that, under the
proposed rule, fewer mines will
experience such increases. Mines that
have effectively implemented an
MSHA-approved safety and health
management program (to avoid being
placed on a POV) would have
procedures in place to continuously
address hazardous conditions. Mines
that successfully get off of a POV would
have increased incentive (see the cost
analysis) to remain off and would likely
institute continuing measures to
minimize violations and address
hazardous conditions.
MSHA based its estimates of the
monetary values for the benefits
associated with the proposed rule on
relevant literature. To estimate the
monetary values of the reductions in
nonfatal injuries, MSHA performed an
analysis of the imputed value of injuries
avoided based on a willingness-to-pay
approach. This approach relies on the
theory of compensating wage
differentials (i.e., the wage premium
paid to workers to accept the risk
associated with various jobs) in the
labor market. A number of studies have
shown a correlation between higher job
risk and higher wages, suggesting that
employees demand monetary
compensation in return for incurring a
greater risk.
Viscusi & Aldy (2003) conducted an
analysis of studies that use a
willingness-to-pay methodology to
estimate the imputed value of lifesaving programs (i.e., meta-analysis) and
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found that the value of each lost workday injury prevented was approximately
$50,000 in 2000 dollars. Using the GDP
Deflator (U.S. Bureau of Economic
Analysis, 2010), this yields an estimate
of $62,000 for each lost work-day injury
avoided in 2009 dollars.
MSHA recognizes that willingness-topay estimates involve uncertainty and
imprecision. Although MSHA is using
the Viscusi & Aldy (2003) study as the
basis for monetizing the expected
benefits of the proposed rule, the
Agency does so with several
reservations, given the methodological
difficulties involved in estimating the
compensating wage differentials (see
Hintermann, Alberini, and Markandya,
2008). Furthermore, these estimates
pooled across different industries may
not capture the unique circumstances
faced by miners. For example, some
have suggested that the models be
disaggregated to account for different
levels of risk, as might occur in coal
mining (see Sunstein, 2004). In
addition, miners may have few options
of alternative employers and, in some
cases, only one employer (nearmonopsony or monopsony) that may
depress wages below those in a more
competitive labor market. In the future,
MSHA plans to work with other
agencies to refine the approach taken in
this proposed rule.
Based on the estimated prevention of
150 nonfatal injuries per year, the
proposed rule would result in
monetized benefits of approximately
$9.3 million per year (150 nonfatal
injuries × $62,000 per injury). MSHA
believes that this is a low estimate for
the total benefits of the proposed rule
for the reasons stated above. MSHA
solicits comments on the benefit
estimates.
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D. Compliance Costs
Proposed § 104.3(c) would require
MSHA to issue an order withdrawing all
persons from the affected area of the
mine if any S&S violation is found
within 90 days after the issuance of the
POV notice. No one would be allowed
to enter the area affected by the
violation until the condition has been
abated, except those persons who must
enter the affected area to correct the
violation.
Under proposed § 104.3(d), if a
withdrawal order is issued under
proposed § 104.3(c), any subsequent
S&S violation would result in an order
withdrawing all persons from the
affected area of the mine until the
authorized representative of the
Secretary determines that the violation
has been abated, except those persons
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who must enter the affected area to
correct the violation.
Closure orders can have a substantial
effect on the ability of a mine to conduct
its business. The threat of closure
provides a strong incentive for operators
to ensure that S&S violations do not
recur. As was noted under benefits,
MSHA anticipates that few operators
would risk such an occurrence. Rather
than risking a POV and the possibility
of a closure, MSHA projects that mine
operators would monitor their
compliance record against the proposed
POV criteria using the Agency’s website.
MSHA estimates that it will take a
supervisor an average of 5 minutes each
month to monitor each mine’s
performance using the Agency’s
website. Based on the average
supervisory wage rate for all mining in
2009 of $65.05 per hour, MSHA
estimates that the yearly cost for all
mine operators to monitor their
performance would be about $0.9
million (14,098 mines × 5/60 hours per
month × 12 months per year × $65.05
per hour).
However, MSHA believes that this
may be an overestimate. As was noted
above, some operators are currently
requesting this information from MSHA.
Making the information available on the
Agency’s Web site would reduce the
costs for these mine operators. MSHA
requests comments on the burden that
monitoring compliance record against
the proposed POV criteria using the
Agency’s Web site would place on mine
operators.
MSHA projects that approximately 50
mine operators each year would submit
a safety and health management
program to MSHA for approval as a
mitigating circumstance. MSHA
believes that it would take management
working with miners to develop and
implement an effective safety and health
management program. MSHA projects
that developing such a program with
meaningful and measurable benchmarks
would take about 80 hours of a
supervisor’s time and 80 hours of
miners’ time. MSHA projects that it
would take an additional 40 hours of a
supervisor’s time and 40 hours of
miners’ time during the approval
process and that the cost for copying
and mailing the program and revisions
would be about $100. MSHA projects it
will take 40 hours of a supervisor’s time
to implementing the program plus 120
hours of miners’ time to run the
program (based on an average size mine
in terms of employment).
Although the proposed rule applies to
all mining, based on the Agency’s
experience and due to the nature of the
mining conditions, MSHA projects that
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the proposed rule would have a greater
impact on underground coal mining
than any other mining sector. During the
period June 2007 through September
2009, underground coal mine operators
received nearly 80 percent of the PPOV
notifications. Rather than using the
wage rates for all mining as was done to
estimate the costs for monitoring mine
performance, MSHA used the 2009
underground coal mine hourly wage
rates of $84.70 for a supervisor and
$35.30 for a miner to estimate these
costs. Since the hourly wage rates in
underground coal mining are higher
than those in surface coal and metal/
nonmetal mining, this approach could
overstate the estimated costs.
The average cost of developing and
implementing an approved safety and
health program at a mine would be
approximately $22,100 (160 hours of a
supervisor’s time × $84.70 per hour +
240 hours of miners’ time × $35.30 per
hour + $100). MSHA anticipates that,
each year, the projected 50 mines that
would choose to implement an MSHAapproved safety and health management
program would incur costs of
approximately $1.1 million.
Although MSHA does not have a
historical basis from which to estimate
the potential costs that would be
incurred by a mine on a POV, MSHA
determined that a good proxy for these
costs would be the potential production
lost during mine closures while the
operators take the necessary actions to
correct the safety and health violations.
MSHA projects that a typical mine
would lose about 0.5 percent of revenue
as the result of closures (about 1 or 2
days for a large mine and a day or less
for a small mine) and that lost revenue
due to the closures would likely vary
considerably among mines depending
on the specific conditions in the mine.
Some mines would likely incur greater
than average losses while others would
incur less than average losses.
As was noted above, based on the
Agency’s experience and due to the
nature of the mining conditions, MSHA
projects that the proposed rule would
affect underground coal mining more
than any other mining sector. MSHA,
therefore, used the revenue in the
underground coal sector to estimate
potential production losses. The average
number of underground coal mines in
operation during a month in 2009 was
424. These mines generated an
estimated $18.5 billion in revenue in
2009, an average of approximately $43.6
million per mine. One-half percent of an
average mine’s revenue is about
$218,000.
MSHA estimates that the projected 10
mines that would be on a POV each year
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would potentially incur about $2.2
million in production losses (10 mines
× $218,000 per mine). Since the average
revenue per underground coal mine is
significantly higher than the average
revenue produced by a mine in the
entire mining industry (i.e., $6.6 million
per mine = $92.8 billion/14,098 mines),
this approach could overstate the
estimated costs.
MSHA estimates that the total yearly
cost of the proposed rule would be $4.2
million; $0.9 million for monitoring the
performance of each mine, $1.1 million
for 50 mines developing and
implementing MSHA-approved safety
and health management programs, plus
$2.2 million for 10 mines operating
under a POV. MSHA’s estimates do not
include the cost of coming into
compliance with the underlying
regulatory requirements. Although these
costs can be substantial, they were
previously attributed to compliance
with MSHA’s existing regulations and
are not new compliance costs resulting
from the proposed rule. MSHA solicits
comments on the cost estimates.
E. Net Benefits
This section presents a summary of
the estimated net benefits of the
proposed rule for informational
purposes only. Under the Mine Act,
MSHA is not required to use estimated
net benefits as the basis for its decision
to promulgate a rule.
Based on the estimated prevention of
150 nonfatal injuries per year, MSHA
estimates that the proposed rule would
result in monetized benefits of $9.3
million per year (150 nonfatal injuries
per year × $62,000 per injury) compared
to estimated costs of $4.2 million per
year, for an estimated net benefit of
approximately $5.1 million per year.
MSHA solicits comments on the net
benefit estimate.
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V. Feasibility
MSHA has concluded that the
requirements of the pattern of violations
proposed rule are technologically and
economically feasible.
A. Technological Feasibility
MSHA concludes that this proposed
rule is technologically feasible. The
proposed rule is not technology-forcing.
In order to avoid a POV, mine operators
would have to comply with existing
MSHA regulations, which have
previously been determined to be
technologically feasible.
B. Economic Feasibility
MSHA also concludes that this
proposed rule is economically feasible.
Mine operators can avoid the expenses
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of being placed on a pattern of
violations by complying with existing
MSHA regulations, all of which have
previously been found to be
economically feasible. For those mine
operators who are in danger of a POV,
MSHA will consider the institution of
an approved safety and health
management program as a mitigating
circumstance. MSHA expects few mines
(about 10 per year) would incur the
potential expenses associated with
closures while on a POV.
MSHA has traditionally used a
revenue screening test—whether the
yearly compliance costs of a regulation
are less than one percent of revenues—
to establish presumptively that
compliance with the regulation is
economically feasible for the mining
community. Based on this test, MSHA
has concluded that the requirements of
the proposed rule are economically
feasible. The estimated annual
compliance costs of the proposed rule to
mine operators are $4.2 million, which
are insignificant compared to total
annual revenue of $92.8 billion for the
mining industry (i.e., significantly less
that one percent of the mining
industry’s $92.8 billion revenue, which
is $928 million). Even if all of the costs
were borne by the underground coal
industry, the estimated $4.2 million cost
of the proposed rule is about 0.02
percent of the underground coal
industry’s 2009 revenue of $18.5 billion.
MSHA, therefore, concludes that
compliance with the provisions of the
proposed rule would be economically
feasible for the mining industry.
VI. Regulatory Flexibility Act and
Small Business Regulatory Enforcement
Fairness Act (SBREFA)
Pursuant to the Regulatory Flexibility
Act (RFA) of 1980, as amended by
SBREFA, MSHA has analyzed the
impact of the proposed rule on small
businesses. Based on that analysis,
MSHA has notified the Chief Counsel
for Advocacy, Small Business
Administration (SBA), and made the
certification under the RFA at 5 U.S.C.
605(b) that the proposed rule would not
have a significant economic impact on
a substantial number of small entities.
The factual basis for this certification is
presented below.
A. Definition of a Small Mine
Under the RFA, in analyzing the
impact of the proposed rule on small
entities, MSHA must use the SBA
definition for a small entity or, after
consultation with the SBA Office of
Advocacy, establish an alternative
definition for the mining industry by
publishing that definition in the Federal
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Register for notice and comment. MSHA
has not taken such an action and is
required to use the SBA definition. The
SBA defines a small entity in the mining
industry as an establishment with 500
or fewer employees.
In addition to examining small
entities as defined by SBA, MSHA has
also looked at the impact of this
proposed rule on mines with fewer than
20 employees, which MSHA and the
mining community have traditionally
referred to as ‘‘small mines.’’ These small
mines differ from larger mines not only
in the number of employees, but also in
economies of scale in material
produced, in the type and amount of
production equipment, and in supply
inventory. The costs of complying with
the proposed rule and the impact of the
proposed rule on small mines will also
be different. It is for this reason that
small mines are of special concern to
MSHA.
MSHA concludes that it can certify
that the proposed rule would not have
a significant economic impact on a
substantial number of small entities that
would be covered by this proposed rule.
The Agency has determined that this is
the case both for mines with fewer than
20 employees and for mines with 500 or
fewer employees.
B. Factual Basis for Certification
Mine operators can avoid the
expenses of being placed on a POV by
complying with MSHA regulations.
Under the proposed rule, MSHA will
consider the institution of an approved
safety and health management program
as a mitigating circumstance for those
mine operators who are placed on a
pattern. MSHA expects few mines
(about 10 per year) would incur the
potential expenses associated with
closure orders under a POV.
MSHA initially evaluates the impacts
on ‘‘small entities’’ by comparing the
estimated compliance costs of a rule for
small entities in the sector affected by
the rule to the estimated revenues for
the affected sector. When estimated
compliance costs are less than one
percent of the estimated revenues, the
Agency believes it is generally
appropriate to conclude that there is no
significant economic impact on a
substantial number of small entities.
When estimated compliance costs
exceed one percent of revenues, MSHA
investigates whether a further analysis
is required. Since it was not possible to
accurately project the distribution of
mines that would incur the estimated
$4.2 million to comply with the
proposed rule by commodity and size,
MSHA examined the impact using
several alternative assumptions.
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The average number of mines in
operation during a month in 2009 with
500 or fewer employees was 14,050.
These mines generated an estimated
$71.9 billion in revenue in 2009. Even
if all of the costs were incurred by
mines with 500 or fewer employees, the
estimated $4.2 million in compliance
costs would be less than 0.006 percent
of the revenue generated by all small
mines according to the SBA’s definition.
The average number of underground
coal mines in operation during a month
in 2009 with 500 or fewer employees
was 412. These mines generated an
estimated $13.7 billion in revenue in
2009. Even if all of the costs were
incurred by underground coal mines
with 500 or fewer employees, the $4.2
million in compliance costs would be
about 0.03 percent of the revenue
generated by small underground coal
mines according to the SBA’s definition.
The average number of mines in
operation during a month in 2009 with
1–19 employees was 11,816. These
mines generated an estimated $17.4
billion in revenue in 2009. Even if all of
the costs were incurred by mines with
1–19 employees, the estimated $4.2
million compliance costs would be
about 0.02 percent of the revenue
generated by all small mines with fewer
than 20 employees.
The average number of underground
coal mines in operation during a month
in 2009 with 1–19 employees was 81.
These mines generated an estimated
$920 million in revenue in 2009. Even
if all of the $4.2 million in compliance
costs were incurred by underground
coal mines with 1–19 employees, the
costs would be about 0.45 percent of the
revenue generated by small
underground coal mines with fewer
than 20 employees.
Moreover, mine operators can avoid
any costs associated with being on a
POV simply by complying with the law.
If an operator has trouble complying
and is in danger of being on POV, under
the proposed rule, the implementation
of an approved safety and health
management program would serve as a
mitigating circumstance.
Accordingly, MSHA has certified that
the proposed rule would not have a
significant economic impact on a
substantial number of small entities.
VII. Paperwork Reduction Act of 1995
A. Summary
This proposed rule contains a
collection-of-information requirement
subject to review and approval by OMB
under the Paperwork Reduction Act
(PRA). MSHA estimates that under the
proposed rule about 50 mines each year
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would develop and implement
approved safety and health management
programs. This would impose
information collection requirements
related to mitigating circumstances
under proposed § 104.2(a)(8).
MSHA expects that developing an
approved program with meaningful and
measurable benchmarks would take
about 160 hours of a supervisor’s time
at an hourly wage of $84.70 and 240
hours of miners’ time at an hourly wage
of $35.30. Costs for copying and mailing
the program and revisions are estimated
to be $100 per program.
The burden of developing and
implementing an approved safety and
health program is 400 hours per mine
(160 + 240) and the average cost is
approximately $22,100 (160 hours of a
supervisor’s time × $84.70 per hour +
240 hours of miners’ time × $35.30 per
hour + $100).
Burden Hours: 50 mines × 400 hours
per mine = 20,000 hours.
Burden Costs: 50 mines × $100 per
mine = $5,000.
B. Procedural Details
The information collection package
for this proposed rule has been
submitted to OMB for review under 44
U.S.C. 3504, paragraph (h) of the
Paperwork Reduction Act of 1995, as
amended (44 U.S.C. 3501 et seq.).
MSHA requests comments to:
• Evaluate whether the proposed
collection of information is necessary
for the proper performance of the
functions of the agency, including
whether the information will have
practical utility;
• Evaluate the accuracy of the
Agency’s estimate of the burden of the
proposed collection of information,
including the validity of the
methodology and assumptions used;
• Enhance the quality, utility, and
clarity of the information to be
collected; and
• Minimize the burden of the
collection of information on those who
are to respond, including through the
use of appropriate automated,
electronic, mechanical, or other
technological collection techniques or
other forms of information technology,
e.g., permitting electronic submission of
responses.
Comments on the information
collection requirements should be sent
to both OMB and MSHA. Addresses for
both offices can be found in the
ADDRESSES section of this preamble. The
regulated community is not required to
respond to any collection of information
unless it displays a current, valid, OMB
control number. MSHA displays the
OMB control numbers for the
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5727
information collection requirements in
its regulations in 30 CFR part 3.
VIII. Other Regulatory Considerations
A. The Unfunded Mandates Reform Act
of 1995
MSHA has reviewed the proposed
rule under the Unfunded Mandates
Reform Act of 1995 (2 U.S.C. 1501 et
seq.). MSHA has determined that this
proposed rule would not include any
federal mandate that may result in
increased expenditures by State, local,
or tribal governments; nor would it
increase private sector expenditures by
more than $100 million in any one year
or significantly or uniquely affect small
governments. Accordingly, the
Unfunded Mandates Reform Act of 1995
requires no further Agency action or
analysis.
B. Executive Order 13132: Federalism
This proposed rule would not have
‘‘federalism implications’’ because it
would not ‘‘have substantial direct
effects 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.’’
Accordingly, under E.O. 13132, no
further Agency action or analysis is
required.
C. The Treasury and General
Government Appropriations Act of
1999: Assessment of Federal
Regulations and Policies on Families
Section 654 of the Treasury and
General Government Appropriations
Act of 1999 (5 U.S.C. 601 note) requires
agencies to assess the impact of Agency
action on family well-being. MSHA has
determined that this proposed rule
would have no effect on family stability
or safety, marital commitment, parental
rights and authority, or income or
poverty of families and children. This
proposed rule impacts only the mining
industry. Accordingly, MSHA certifies
that this proposed rule would not
impact family well-being.
D. Executive Order 12630: Government
Actions and Interference With
Constitutionally Protected Property
Rights
The proposed rule would not
implement a policy with takings
implications. Accordingly, under E.O.
12630, no further Agency action or
analysis is required.
E. Executive Order 12988: Civil Justice
Reform
This proposed rule was written to
provide a clear legal standard for
affected conduct and was carefully
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Federal Register / Vol. 76, No. 22 / Wednesday, February 2, 2011 / Proposed Rules
reviewed to eliminate drafting errors
and ambiguities, so as to minimize
litigation and undue burden on the
Federal court system. Accordingly, this
proposed rule would meet the
applicable standards provided in
section 3 of E.O. 12988, Civil Justice
Reform.
F. Executive Order 13045: Protection of
Children From Environmental Health
Risks and Safety Risks
This proposed rule would have no
adverse impact on children.
Accordingly, under E.O. 13045, no
further Agency action or analysis is
required.
G. Executive Order 13175: Consultation
and Coordination With Indian Tribal
Governments
This proposed rule would not have
‘‘tribal implications’’ because it would
not ‘‘have substantial direct effects 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.’’
Accordingly, under E.O. 13175, no
further Agency action or analysis is
required.
mstockstill on DSKH9S0YB1PROD with PROPOSALS
H. Executive Order 13211: Actions
Concerning Regulations That
Significantly Affect Energy Supply,
Distribution, or Use
Executive Order 13211 requires
agencies to publish a statement of
energy effects when a rule has a
significant energy action (i.e., it
adversely affects energy supply,
distribution or use). MSHA has
reviewed this proposed rule for its
energy effects because the proposed rule
applies to the coal mining sector.
Because this proposed rule would result
in annual costs of approximately $4.2
million, most of which would be
incurred by the coal mining industry,
relative to annual coal mining industry
revenues of $35.7 billion in 2009,
MSHA has concluded that it is not a
significant energy action because it is
not likely to have a significant adverse
effect on the supply, distribution, or use
of energy. Accordingly, under this
analysis, no further Agency action or
analysis is required.
I. Executive Order 13272: Proper
Consideration of Small Entities in
Agency Rulemaking
MSHA has reviewed the proposed
rule to assess and take appropriate
account of its potential impact on small
businesses, small governmental
jurisdictions, and small organizations.
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MSHA has determined and certified that
the proposed rule would not have a
significant economic impact on a
substantial number of small entities.
miners. The purpose of the procedures
in this part is the restoration of effective
safe and healthful conditions at such
mines.
IX. References
§ 104.2
Hintermann, B., Alberini, A., Markandya, A.
(2010). ‘‘Estimating the Value of Safety
with Labor Market Data: Are the Results
Trustworthy?’’ Applied Economics.
42(9):1085–1100. Published
electronically in July 2008.
Sunstein, C. (2004). ‘‘Valuing Life: A Plea for
Disaggregation.’’ Duke Law Journal, 54
(November 2004): 385–445.
U.S. Bureau of Economic Analysis (2010).
National Income and Product Accounts
Table: Table 1.1.9. Implicit Price
Deflators for Gross Domestic Product
[Index numbers, 2005 = 100]. Revised
May 27, 2010. https://www.bea.gov/
national/nipaweb/TableView.asp?
SelectedTable=13&Freq=Qtr&FirstYear=
2006&LastYear=2008.
Viscusi, W. and Aldy, J. (2003). ‘‘The Value
of a Statistical Life: A Critical Review of
Market Estimates Throughout the
World,’’ Journal of Risk and Uncertainty,
(27:5–76).
(a) Specific pattern criteria will be
posted on MSHA’s Web site at https://
www.msha.gov and used in the review
to identify mines with a pattern of S&S
violations. The review will include:
(1) Citations for significant and
substantial violations;
(2) Orders under section 104(b) of the
Act for not abating significant and
substantial violations;
(3) Citations and withdrawal orders
under section 104(d) of the Act,
resulting from the operator’s
unwarrantable failure to comply;
(4) Imminent danger orders under
section 107(a) of the Act;
(5) Orders under section 104(g) of the
Act requiring withdrawal of miners who
have not received training and who the
inspector declares to be a hazard to
themselves and others;
(6) Enforcement measures, other than
section 104(e) of the Act, which have
been applied at the mine;
(7) Other information that
demonstrates a serious safety or health
management problem at the mine such
as accident, injury, and illness records;
and
(8) Mitigating circumstances.
(b) At least two times each year,
MSHA will review the compliance and
accident, injury, and illness records of
mines to determine if any mines meet
the criteria posted on MSHA’s Web site.
List of Subjects in 30 CFR Part 104
Administrative practice and
procedure, Law enforcement, Mine
safety and health, Reporting and
recordkeeping requirements.
Dated: January 28, 2011.
Joseph A. Main,
Assistant Secretary of Labor for Mine Safety
and Health.
For the reasons set out in the
preamble, and under the authority of the
Federal Mine Safety and Health Act of
1977 as amended by the Mine
Improvement and New Emergency
Response Act of 2006, MSHA is
proposing to amend chapter I of title 30
of the Code of Federal Regulations by
revising part 104 as follows:
PART 104—PATTERN OF VIOLATIONS
Sec.
104.1
104.2
104.3
104.4
Purpose and scope.
Pattern criteria.
Issuance of notice.
Termination of notice.
Authority: 30 U.S.C. 814(e), 957.
§ 104.1
Purpose and scope.
This part establishes the criteria and
procedures for determining whether a
mine operator has established a pattern
of significant and substantial (S&S)
violations at a mine. It implements
section 104(e) of the Federal Mine
Safety and Health Act of 1977 (Act) by
addressing mines with an inspection
history of recurrent S&S violations of
mandatory safety or health standards
that demonstrate a mine operator’s
disregard for the safety and health of
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§ 104.3
Pattern criteria.
Issuance of notice.
(a) When a mine has a pattern of
violations, the District Manager will
issue a pattern of violations notice to the
mine operator that specifies the basis for
the Agency’s action. The District
Manager will also provide a copy of this
notice to the representative of miners.
(b) The mine operator shall post a
copy of the notice on the mine bulletin
board. The notice shall remain posted at
the mine until it is terminated under
§ 104.4 of this part.
(c) If, on any inspection within 90
days after issuance of the pattern notice,
an authorized representative of the
Secretary finds any S&S violation, he
shall issue an order for the withdrawal
of all persons from the affected area,
except those persons referred to in
section 104(c) of the Act, until the
condition has been abated.
(d) If a withdrawal order is issued
under paragraph (c) of this section, any
subsequent S&S violation will result in
a withdrawal order that shall remain in
effect until the authorized
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Federal Register / Vol. 76, No. 22 / Wednesday, February 2, 2011 / Proposed Rules
representative of the Secretary
determines that the violation has been
abated.
§ 104.4
Termination of notice.
(a) Termination of a section 104(e)(1)
pattern of violations notice shall occur
when an MSHA inspection of the entire
mine finds no S&S violations, or if no
withdrawal order is issued by MSHA in
accordance with section 104(e)(1) of the
Act within 90 days of the issuance of
the pattern notice.
(b) The mine operator may request an
inspection of the entire mine or portion
of the mine. No advance notice of the
inspection shall be provided, and the
scope of inspection shall be determined
by MSHA. Partial mine inspectionscovering the entire mine within 90 days
shall constitute an inspection of the
entire mine for the purposes of this part.
[FR Doc. 2011–2255 Filed 1–31–11; 8:45 am]
BILLING CODE 4510–43–P
DEPARTMENT OF DEFENSE
Office of the Secretary
32 CFR Part 156
[DOD–2008–OS–0160; RIN 0790–AI42]
Department of Defense Personnel
Security Program (PSP)
Department of Defense.
Proposed rule.
AGENCY:
ACTION:
This rule would update
policies and responsibilities for the
Department of Defense (DoD) Personnel
Security Program (PSP) in accordance
with the provisions of current U.S.
Code, Public Laws, and Executive
Orders (E.O.).
DATES: Comments must be received by
April 4, 2011.
ADDRESSES: You may submit comments,
identified by docket number and/or
Regulatory Information Number (RIN)
number and title, by any of the
following methods:
• Federal Rulemaking Portal: https://
www.regulations.gov. Follow the
instructions for submitting comments.
• Mail: Federal Docket Management
System Office, 1160 Defense Pentagon,
OSD Mailroom 3C843, Washington, DC
20301–1160.
Instructions: All submissions received
must include the agency name and
docket number or Regulatory
Information Number (RIN) for this
Federal Register document. The general
policy for comments and other
submissions from members of the public
is to make these submissions available
mstockstill on DSKH9S0YB1PROD with PROPOSALS
SUMMARY:
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for public viewing on the Internet at
https://www.regulations.gov as they are
received without change, including any
personal identifiers or contact
information.
FOR FURTHER INFORMATION CONTACT:
Stacey Jefferson, (703) 604–1236.
The
Department of Defense Directive (DoDD)
5200.2, Personnel Security Program
(PSP), codified at 32 CFR 156, was
issued April 9, 1999. The Department is
reissuing the DoD Directive as a DoD
Instruction to update existing policy
regarding the DoD Personnel Security
Program and also incorporate new
policy related to Homeland Security
Presidential Directive-12 (HSPD–12).
This rule provides PSP policy
fundamental to preventing unauthorized
disclosure of sensitive and classified
information that could cause irreparable
damage to national security. The policy
portion relating to HSPD–12
implements investigative and
adjudicative policy for the Department’s
personal identity verification credential.
Updates to the policy reflect Joint
Security and Suitability Reform Team
efforts to incorporate the foundational
policy changes needed to implement
reform. The Intelligence Reform and
Terrorism Prevention Act of 2004, E.O.
13467, E.O. 12968, E.O. 10865, and
HSPD–12 are some of the current
Federal laws, directives and statutes
that impact the DoD PSP. Since this rule
was last published, additional executive
orders have been issued directing
alignment of security, suitability and
reciprocal acceptance of prior
investigations and favorable
determinations.
The procedural guidance for the DoD
PSP is currently being updated and will
subsequently be proposed as rule
codified at 32 CFR part 154. The
investigative and adjudication
procedural guidance for the DoD
Federal personal identity verification
credential pursuant HSPD–12 is
undergoing coordination and will also
be proposed a separate rule.
SUPPLEMENTARY INFORMATION:
E.O. 12866, ‘‘Regulatory Planning and
Review’’
It has been certified that 32 CFR part
156 does not:
(1) Have an annual effect on the
economy of $100 million or more or
adversely affect in a material way the
economy; a section of the economy;
productivity; competition; jobs; the
environment; public health or safety; or
State, local, or tribunal governments or
communities;
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5729
(2) Create a serious inconsistency or
otherwise interfere with an action taken
or planned by another Agency;
(3) Materially alter the budgetary
impact of entitlements, grants, user fees,
or loan programs, or the rights and
obligations of recipients thereof; or
(4) Raise novel legal or policy issues
arising out of legal mandates, the
President’s priorities, or the principles
set forth in this E.O.
Section 202, Public Law 104–4,
‘‘Unfunded Mandates Reform Act’’
It has been certified that 32 CFR part
156 does not contain a Federal mandate
that may result in the expenditure by
State, local and tribunal governments, in
aggregate, or by the private sector, of
$100 million or more in any one year.
Public Law 96–354, ‘‘Regulatory
Flexibility Act’’ (5 U.S.C. 601)
It has been certified that 32 CFR part
156 is not subject to the Regulatory
Flexibility Act (5 U.S.C. 601) because it
would not, if promulgated, have a
significant economic impact on a
substantial number of small entities.
Public Law 96–511, ‘‘Paperwork
Reduction Act’’ (44 U.S.C. Chapter 35)
It has been certified that 32 CFR part
156 does not impose reporting or
recordkeeping requirements under the
Paperwork Reduction Act of 1995.
E.O. 13132, ‘‘Federalism’’
It has been certified that 32 CFR part
156 does not have federalism
implications, as set forth in E.O. 13132.
This rule does not have substantial
direct effects on:
(1) The States;
(2) The relationship between the
National Government and the States; or
(3) The distribution of power and
responsibilities among the various
levels of Government.
List of Subjects in 32 CFR Part 156
Government employees; Security
measures.
Accordingly, 32 CFR part 156 is
revised to read as follows.
PART 156—DEPARTMENT OF
DEFENSE PERSONNEL SECURITY
PROGRAM (PSP)
Sec.
156.1 Purpose.
156.2 Applicability.
156.3 Definitions.
156.4 Policy.
156.5 Responsibilities.
156.6 Procedures-sensitive positions,
duties, and classified access.
156.7 Procedures—common access card
investigation and adjudication.
E:\FR\FM\02FEP1.SGM
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Agencies
[Federal Register Volume 76, Number 22 (Wednesday, February 2, 2011)]
[Proposed Rules]
[Pages 5719-5729]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2011-2255]
========================================================================
Proposed Rules
Federal Register
________________________________________________________________________
This section of the FEDERAL REGISTER contains notices to the public of
the proposed issuance of rules and regulations. The purpose of these
notices is to give interested persons an opportunity to participate in
the rule making prior to the adoption of the final rules.
========================================================================
Federal Register / Vol. 76, No. 22 / Wednesday, February 2, 2011 /
Proposed Rules
[[Page 5719]]
DEPARTMENT OF LABOR
Mine Safety and Health Administration
30 CFR Part 104
RIN 1219-AB73
Pattern of Violations
AGENCY: Mine Safety and Health Administration, Labor.
ACTION: Proposed rule; notice of close of comment period.
-----------------------------------------------------------------------
SUMMARY: The Mine Safety and Health Administration (MSHA) is proposing
to revise the Agency's existing regulation for pattern of violations
(POV). MSHA has determined that the existing regulation does not
adequately achieve the intent of the Federal Mine Safety and Health Act
of 1977 (Mine Act) that the POV provision be used to address operators
who have demonstrated a disregard for the safety and health of miners.
Congress included the POV provision in the Mine Act so that operators
would manage safety and health conditions at mines and find and fix the
root causes of significant and substantial (S&S) violations to protect
the safety and health of miners. The proposal would simplify the
existing POV criteria, improve consistency in applying the POV
criteria, and more adequately achieve the statutory intent. It would
also encourage chronic violators to comply with the Mine Act and MSHA's
safety and health standards.
DATES: MSHA must receive comments by midnight Eastern Standard Time on
April 4, 2011.
ADDRESSES: Comments must be identified with ``RIN 1219-AB73'' and may
be sent to MSHA by any of the following methods:
Federal E-Rulemaking Portal: https://www.regulations.gov.
Follow the on-line instructions for submitting comments.
Electronic mail: zzMSHAcomments@dol.gov. Include ``RIN
1219-AB73'' in the subject line of the message.
Facsimile: 202-693-9441. Include ``RIN 1219-AB73'' in the
subject line of the message.
Regular Mail: MSHA, Office of Standards, Regulations, and
Variances, 1100 Wilson Boulevard, Room 2350, Arlington, Virginia 22209-
3939.
Hand Delivery or Courier: MSHA, Office of Standards,
Regulations, and Variances, 1100 Wilson Boulevard, Room 2350,
Arlington, Virginia. Sign in at the receptionist's desk on the 21st
floor.
Information Collection Requirements:
Comments concerning the information collection requirements of this
proposed rule must be clearly identified with ``RIN 1219-AB73'' and
sent to both the Office of Management and Budget (OMB) and MSHA.
Comments to OMB may be sent by mail addressed to the Office of
Information and Regulatory Affairs, Office of Management and Budget,
New Executive Office Building, 725 17th Street, NW., Washington, DC
20503, Attn: Desk Officer for MSHA. Comments to MSHA may be transmitted
by any of the methods listed above in this section.
FOR FURTHER INFORMATION CONTACT: April E. Nelson, Acting Director,
Office of Standards, Regulations, and Variances, MSHA, at
nelson.april@dol.gov (e-mail); 202-693-9440 (voice); or 202-693-9441
(facsimile).
SUPPLEMENTARY INFORMATION:
Table of Contents
I. Introduction
II. Background and Regulatory History
III. Section-by-Section Analysis
IV. Preliminary Regulatory Economic Analysis
V. Feasibility
VI. Regulatory Flexibility Analysis and Small Business Regulatory
Enforcement Fairness Act (SBREFA)
VII. Paperwork Reduction Act of 1995
VIII. Other Regulatory Considerations
IX. References
I. Introduction
Availability of Information
Public Comments: MSHA will post all comments on the Internet
without change, including any personal information provided. Access
comments electronically at https://www.msha.gov/regsinfo.htm. Review
comments in person at the Office of Standards, Regulations, and
Variances, 1100 Wilson Boulevard, Room 2350, Arlington, Virginia. Sign
in at the receptionist's desk on the 21st floor.
E-mail notification: MSHA maintains a list that enables subscribers
to receive e-mail notification when the Agency publishes rulemaking
documents in the Federal Register. To subscribe, go to https://www.msha.gov/subscriptions/subscribe.aspx.
Information Collection Supporting Statement: A copy of the
information collection package can be obtained from the Department of
Labor by electronic mail request to Michel Smyth at
smyth.michel@dol.gov or by phone request to 202-693-4129.
II. Background and Regulatory History
A. Statutory Provision
In enacting the Mine Act, Congress included the pattern of
violations (POV) provision in section 104(e) to provide MSHA with an
additional enforcement tool to protect miners when the operator
demonstrated a disregard for the safety and health of miners. The need
for such a provision was forcefully demonstrated during the
investigation of the Scotia Mine disaster, which occurred in 1976 in
Eastern Kentucky. (S. Rep. No. 181, 95th Cong., 1st Sess. at 32.) As a
result of explosions on March 9 and 11, 1976, caused by dangerous
accumulations of methane, 23 miners and three mine inspectors lost
their lives. The Scotia Mine had a chronic history of persistent,
serious violations that were cited over and over by MSHA. After abating
the violations, the operator would permit the same violations to recur,
repeatedly exposing miners to the same hazards. The accident
investigation showed that MSHA's then-existing enforcement program was
unable to address the Scotia Mine's history of recurring violations.
The Mine Act places the ultimate responsibility for ensuring the
safety and health of miners on mine operators. The legislative history
of the Mine Act emphasizes that Congress reserved the POV provision for
mine operators with a record of repeated S&S violations. Congress
intended the POV sanction to attain remedial action from operators
``who have not responded to the Agency's other enforcement efforts.''
(55 FR 31129) The legislative history states that Congress believed
that the existence of a pattern would signal to both the
[[Page 5720]]
mine operator and the Secretary that ``there is a need to restore the
mine to effective safe and healthful conditions and that the mere
abatement of violations as they are cited is insufficient.'' (S. Rep.
No. 181, supra at 33.)
The Mine Act does not define ``pattern of violations,'' but section
104(e)(4) authorizes the Secretary to establish criteria for
determining when a pattern of violations of mandatory safety or health
standards exists. Congress provided the Secretary with broad discretion
in establishing pattern criteria, recognizing that MSHA may need to
modify the criteria as experience dictates.
B. Regulatory History
MSHA first proposed a POV regulation in 1980 (45 FR 54656). That
proposal included: Purpose and scope, initial screening, pattern
criteria, issuance of notice, and termination of notice. Commenters
were generally opposed to the 1980 proposal. They stated that the
proposal was complex, too statistically oriented, overbroad, and vague.
In addition, they stated that the rulemaking was untimely because of
litigation then pending before the Federal Mine Safety and Health
Review Commission (Commission) concerning MSHA's interpretation of the
S&S provisions of the Mine Act. Commenters also stated that review of
the Agency's then pending regulation for assessment of civil penalties
could affect the POV proposal.
On February 8, 1985 (50 FR 5470), MSHA announced its withdrawal of
the 1980 proposed rule and issued an advance notice of proposed
rulemaking (ANPRM) that addressed many of the concerns expressed about
the 1980 proposal. In the 1985 ANPRM, MSHA stated that it intended to
focus on the safety and health record of each mine rather than on a
strictly quantitative comparison of mines to industry-wide norms. In
the ANPRM, MSHA stated that the Agency envisioned simplified criteria,
focusing on two principal areas:
(1) Were S&S violations common to a particular hazard or did S&S
violations throughout the mine represent an underlying health and
safety problem, and
(2) Is the mine on a section 104(d) unwarrantable failure sequence,
indicating that other enforcement measures had been ineffective.
MSHA requested suggestions for additional factors the Agency should
use in determining whether a POV exists and requested ideas on
administrative procedures for terminating a pattern notice.
MSHA published a second proposed rule on May 30, 1989 (54 FR
23156), which included criteria and procedures for identifying mines
with a pattern of S&S violations. The 1989 proposal included procedures
for initial identification of mines developing a pattern of violations;
criteria for determining whether a pattern of violations exists at a
mine; notification procedures that would provide both the mine operator
and miners' representative an opportunity to respond to the Agency's
evaluation that a pattern of violations may exist; and procedures for
terminating a pattern notice. The 1989 proposal addressed the major
issues raised by commenters. Commenters' primary concerns were MSHA's
policies for enforcing the S&S provisions of the Mine Act, the civil
penalty regulation, and MSHA's enforcement of the unwarrantable failure
provision of the Mine Act. MSHA held two public hearings and issued a
final rule on July 31, 1990 (55 FR 31128).
The existing rule established MSHA's criteria and procedures for
identifying mines with a POV. The existing rule reflected MSHA's belief
that Congress intended the POV sanction to be directed at restoring
mines to a safe and healthful condition.
Until mid-2007, POV screening was decentralized and lacked a
consistent, structured approach. MSHA District offices were responsible
for conducting the required annual POV screening of mines. Following
the accidents at the Sago, Darby, and Aracoma mines in early 2006, MSHA
began developing a centralized, quantifiable POV screening process.
MSHA initiated its newly developed Pattern of Violations Screening
Criteria and Scoring Model in mid-2007 and updated and revised the
screening criteria and procedures in 2010. MSHA uses a computer program
based on this screening criteria and scoring model to generate lists of
mines with a potential pattern of violations (PPOV).
III. Section-by-Section Analysis
MSHA is proposing the following changes to its existing pattern of
violations regulation.
A. Section 104.1 Purpose and Scope
Proposed Sec. 104.1 would provide the purpose and scope of the
proposal and is unchanged from the existing provision.
B. Section 104.2 Pattern Criteria
Proposed Sec. 104.2 would combine existing Sec. Sec. 104.2 and
104.3. It would specify the general criteria that MSHA would use to
identify mines with a pattern of violations. MSHA would review
compliance, accident, injury, and illness records. MSHA believes that
the proposed rule would simplify the process for determining whether a
mine has a pattern of violations and would more accurately reflect the
statutory intent. Consistent with the Mine Act, the proposed rule would
eliminate all references to initial screening criteria.
Proposed Sec. 104.2(a) would provide that the specific criteria
(e.g., number of S&S violations issued in the previous year) used in
the review to identify mines with a pattern of S&S violations would be
posted on MSHA's website at https://www.msha.gov. MSHA requests specific
comments on how the agency should obtain comment during the development
of, and periodic revision to, the POV screening criteria. MSHA also
requests comments on the best methods for notifying mine operators of
changes to these criteria. Under the proposal, MSHA would review:
(1) Citations for significant and substantial violations;
(2) Orders under section 104(b) of the Act for not abating
significant and substantial violations;
(3) Citations and withdrawal orders under section 104(d) of the
Act, resulting from the operator's unwarrantable failure to comply;
(4) Imminent danger orders under section 107(a) of the Act;
(5) Orders under section 104(g) of the Act requiring withdrawal of
miners who have not received training and who the inspector declares to
be a hazard to themselves and others;
(6) Enforcement measures, other than section 104(e) of the Act,
which have been applied at the mine;
(7) Other information that demonstrates a serious safety or health
management problem at the mine, such as accident, injury, and illness
records; and
(8) Mitigating circumstances.
MSHA believes that posting the specific criteria and compliance
data that the Agency would use on the website would allow mine
operators to monitor their compliance record against the proposed POV
criteria. Some mines have personnel who, currently, are requesting this
information from MSHA. This website would reduce the effort for these
mine operators. Access to this information through a searchable
database would provide operators an opportunity to evaluate their
record and determine whether they are approaching proposed POV criteria
levels. This would enable operators to proactively implement measures
to improve safety and health at their mines and to bring
[[Page 5721]]
their mines into compliance. Posting the specific pattern criteria on
MSHA's website will promote openness and transparency and encourage
operators to examine their compliance record more closely, ascertain
whether they have any recurring problems, and enhance the safety and
health of miners. MSHA believes that sharing this information
facilitates a more proactive approach to safety and health on the part
of all involved with miner safety and health. In addition, MSHA
believes that the ready availability of compliance data will eliminate
the need to inform operators of a potential pattern of violations
(PPOV). MSHA believes that this is an improvement over the existing
process because it allows operators to continually evaluate their
compliance performance.
Under proposed Sec. 104.2(a)(1), like the existing provision, MSHA
would consider a mine's S&S violations.
Like the existing provision, proposed Sec. 104.2(a)(2) would
require MSHA to consider closure orders issued under section 104(b) of
the Mine Act that resulted from S&S violations.
Proposed Sec. 104.2(a)(3), like existing Sec. 104.3(a)(3), would
require MSHA to consider unwarrantable failure citations and withdrawal
orders issued under sections 104(d)(1) and (d)(2) of the Mine Act.
Unwarrantable failure citations and orders often constitute S&S
violations that are the types of serious, repeated violations that
Congress intended to address in a POV regulation.
Proposed Sec. 104.2(a)(4), like existing Sec. 104.2(a)(3), would
require MSHA to consider imminent danger withdrawal orders issued under
section 107(a) of the Mine Act.
Proposed Sec. 104.2(a)(5), derived from existing Sec.
104.2(b)(1), would require MSHA to consider orders issued under section
104(g) of the Act.
Proposed Sec. 104.2(a)(6), like existing Sec. 104.2(b)(1), would
require that MSHA consider enforcement measures other than section
104(e) of the Act, which have been applied at the mine.
Proposed Sec. 104.2(a)(7) would clarify MSHA's intent that the
proposed POV criteria include consideration of operations with serious
safety and health management problems. It is derived from the existing
regulation and the legislative history of the Mine Act.\1\ It would
require MSHA to consider other information, such as accident, injury,
and illness records, that may reveal a serious safety or health
management problem at a mine. This other information may also include:
Enforcement measures, other than POV, applied at the mine; evidence of
the operator's lack of good faith in correcting the problem that
results in repeated S&S violations; repeated S&S violations of a
particular standard; repeated S&S violations of standards related to
the same hazard; and any other relevant information. This is
essentially the same information addressed in existing Sec. Sec.
104.2(b)(2) to (b)(3) and 104.3(a)(1) and (a)(2). In addition, in
making a determination under this aspect of the proposal, MSHA would
consider: knowing and willful S&S violations; citations and orders
issued in conjunction with an accident, including orders under sections
103(j) and (k) of the Mine Act; and S&S violations of safety and health
standards that contribute to the cause of accidents and injuries. MSHA
data and experience show that violations of approval, training, or
recordkeeping regulations, for example, can significantly and
substantially contribute to safety or health hazards. This is
especially true where the mine operator allows similar violations to
occur repeatedly.
---------------------------------------------------------------------------
\1\ The Committee views the 105(d)(1) [now 104(e)] notice as
indicating to both the mine operator and the Secretary that there
exists at mine a serious safety and health management problem.
(Legislative History, Committee Report, p. 620).
---------------------------------------------------------------------------
Under proposed Sec. 104.2(a)(8), like existing Sec. 104.2(b)(4),
MSHA would consider mitigating circumstances. Under this proposed
provision, MSHA would consider the causes of repeated violations that
may be beyond the operator's control, such as changes in mine ownership
or mine management, and whether conditions at the mine show a trend of
significant improvement.
Under this proposed provision and consistent with the legislative
history, MSHA would allow operators to take proactive measures to bring
their mines into compliance. For example, operators who compare their
compliance record with the POV criteria and determine that they are
approaching a pattern of violations level may work with MSHA to bring
their mines into compliance to avoid a POV notice. Under the proposal,
an operator may submit a written safety and health management program
to the District Manager for approval. To obtain approval, operators
should structure safety and health management programs so that MSHA can
determine whether the program's parameters would result in meaningful,
measurable, and significant reductions in S&S violations. The operator
should develop a process and program with measurable benchmarks for
abating specific violations that could lead to a POV and addressing
these hazardous conditions at their mines. Using these benchmarks,
operators would be able to use the MSHA database accessible through the
Agency's Web site to monitor their safety and health record. Under the
proposal, MSHA would consider an operator's effective implementation of
an MSHA-approved safety and health management program as a mitigating
circumstance.
The proposed rule would eliminate the existing requirement in Sec.
104.3(b) that only citations and orders that have become final are to
be used to identify mines with a potential pattern of violations. This
proposal is consistent with the language of section 104(e), the
legislative history of the Mine Act, and the purpose of section 104(e).
In explaining the need for the POV enforcement tool, Congress pointed
out that ``the Scotia mine, as well as other mines, had an inspection
history of recurrent violations, some of which were tragically related
to the disasters, which the existing enforcement scheme was unable to
address.'' (S. Rep. No. 181, 95th Cong., 1st Sess. at 32.) The use of
the phrase ``inspection history'' indicates Congress' intent that POV
determinations be based on inspection histories, i.e., violations found
by MSHA during inspections, rather than only on final citations and
orders.
The Senate Report specifically noted similarities between sections
104(d) and 104(e) of the Mine Act and stated that the POV ``sequence
parallels the current unwarrantable failure sequence.'' (S. Rep. No.
181, supra, at 33.) This reflects Congress's intent that POV
determinations, like section 104(d)(1) and (d)(2) determinations, need
not be final orders. In addition, the Senate Report stated that it was
``* * * the Committee's intention that the Secretary or his authorized
representative [] have both [Section 104(d) and Section 104(e)]
enforcement tools available, and that they [] be used simultaneously if
the situation warrants.'' (Id at 34.) The proposal to consider non-
final citations and orders to identify mines with a POV is consistent
with the Mine Act.
The existing provision limiting MSHA's consideration of citations
and orders to those that are final restricts MSHA's ability to achieve
the purpose of the POV provision, consistent with Congressional intent.
As stated in the Mine Act and its legislative history, the Secretary is
given broad discretion to ``make such rules as [she] deems necessary to
establish criteria for determining when a pattern of violations''
exists. (30 U.S.C. 814(e)(4)) Congress stated that the Secretary should
``continually evaluate and modify the pattern of violations criteria as
she deems necessary.'' (S. Rep. No.
[[Page 5722]]
181, supra at 33.) MSHA's experience with enforcing section 104(e) has
led the Agency to conclude that it is necessary to modify the final
order criteria in its existing POV regulation.
In November 2010, there was a backlog of approximately 88,000
contested violations pending before the Commission. For cases disposed
during November, 2010, it took, on average, 518 days for contested
violations to become final. For a mine with contested citations and
orders that have not become final, the final order provision does not
allow MSHA to review the mine's complete recent compliance history when
assessing whether a POV exists and hinders MSHA's ability to
effectively enforce section 104(e) of the Mine Act. It can allow
chronic violators to avoid or delay the POV sanction and to continue
their repeated pattern of noncompliance with health and safety
standards, without correcting the underlying problem. The final order
provision in the existing regulation provides an incentive for
operators to contest S&S violations to avoid being placed under a POV.
The fact that the Mine Act requires an operator to abate a hazard
prior to contesting a violation provides further support for the
proposed rule. Mine operators must correct the hazardous condition
within the time set by the MSHA inspector, even if they challenge the
violation. The proposal to eliminate the existing requirement that only
final orders be used for POV determination would greatly enhance safety
and health of miners. Fewer than one percent of citations are reversed.
Over 700,000 violations were assessed civil penalties that became final
orders during the five-year period 2006 through 2010, with 3,400
vacated after they were contested. During the same timeframe, 6,000 of
the contested violations were modified from S&S to non-S&S.
Proposed Sec. 104.2(b) would increase the frequency of MSHA's
review of a mine for a POV from at least once per year under the
existing regulation to at least twice per year. MSHA determined that an
annual review would not adequately allow the Agency to identify mines
with recurring S&S violations. The increased frequency of review would
allow MSHA to more promptly identify mines with recurring S&S
violations and take appropriate action. This proposal would also
encourage operators to more closely examine their compliance records to
determine whether greater efforts are necessary to comply with the Mine
Act and MSHA's standards and regulations.
C. Section 104.3 Issuance of Notice
Proposed Sec. 104.3, renumbered from existing Sec. 104.4, would
simplify the requirements for issuing a POV notice.
Proposed Sec. 104.3(a) is similar to existing Sec. 104.4(a). The
proposal would provide that, when a mine has a POV, the District
Manager will issue a POV notice to the mine operator that specifies the
basis for the Agency's action. The District Manager will also provide a
copy of the POV notice to the representative of miners. The proposed
provision would delete all references to a PPOV; otherwise it is
essentially unchanged from the existing requirement.
MSHA believes that this proposed action would allow the Agency to
more effectively implement the POV provision in the Mine Act,
consistent with legislative intent. MSHA's experience and data reveal
that over the past 3 years, mine operators who received a PPOV letter
reduced their S&S violations by at least 30 percent. In this same
period, 6 of 62 operators received more than one PPOV letter. These
mine operators temporarily reduced their S&S violations, but reverted
back to allowing the same hazards to occur again and again without
addressing the underlying causes.
Proposed Sec. 104.3(b), essentially the same as existing Sec.
104.4(d), would require that the mine operator post a copy of the POV
notice on the mine bulletin board and that the notice remain posted
until MSHA terminates the POV notice. Existing Sec. 104.4(d) requires
the operator to post all notifications issued under 30 CFR part 104 at
the mine. The proposal would clarify that the operator post
notifications issued under this part on the mine bulletin board.
Proposed Sec. 104.3(c) is a new provision that would restate the
intent of the Mine Act when a POV notice is issued. It essentially
restates section 104(e)(1) of the Mine Act and would require MSHA to
issue an order withdrawing all persons from the affected area of the
mine if an authorized representative of the Secretary finds any S&S
violation within 90 days after the issuance of the POV notice. No one
would be allowed to enter the area affected by the violation until the
condition has been abated, except those persons referred to in section
104(c) of the Mine Act who must enter the affected area to correct the
violation.
Proposed Sec. 104.3(d) is a new provision that would specifically
restate the intent of the Mine Act when a POV notice is issued. It
would provide that if a withdrawal order is issued under proposed Sec.
104.3(c), any subsequent S&S violation will result in an order
withdrawing all persons from the affected area of the mine until the
authorized representative of the Secretary determines that the
violation has been abated, except those persons identified in section
104(c) of the Mine Act.
D. Section 104.4 Termination of Notice
Proposed Sec. 104.4, renumbered from existing Sec. 104.5,
addresses the termination of a POV notice and continues to provide that
a POV notice will be terminated if MSHA finds no S&S violations during
an inspection of the entire mine, or if no withdrawal order for S&S
violations under section 104(e)(1) of the Mine Act has been issued
within 90 days of the issuance of the POV notice. MSHA's Pattern of
Violations (POV) Procedures Summary, posted on MSHA's website, also
includes requirements for MSHA to conduct a complete inspection of the
entire mine within 90 days of issuing the POV notice. The Procedures
Summary states, in part, the following:
Following notification to the operator of the issuance of a
Notice of Pattern of Violations, the District Manager shall initiate
appropriate inspection activities to ensure that the mine is
inspected in its entirety during the following 90-day period and
each succeeding inspection cycle until the POV notice is terminated.
Proposed Sec. 104.4(b), renumbered from existing Sec. 104.5(b),
is unchanged.
IV. Preliminary Regulatory Economic Analysis
A. Executive Order 12866: Regulatory Planning and Review
Under Executive Order (E.O.) 12866, the Agency must determine
whether a regulatory action is ``significant'' and subject to review by
the Office of Management and Budget (OMB). Section 3(f) of E.O. 12866
defines a ``significant regulatory action'' as an action that is likely
to result in a rule: (1) Having an annual effect on the economy of $100
million or more, or adversely and materially affecting a sector of the
economy, productivity, competition, jobs, the environment, public
health or safety, or state, local, or tribal governments or communities
(also referred to as ``economically significant''); (2) creating
serious inconsistency or otherwise interfering with an action taken or
planned by another agency; (3) materially altering the budgetary
impacts of entitlements, grants, user fees, or loan programs or the
rights and obligations of recipients
[[Page 5723]]
thereof; or (4) raising novel legal or policy issues arising out of
legal mandates, the President's priorities, or the principles set forth
in this Executive Order.
MSHA has determined that this proposed rule would not have an
annual effect of $100 million or more on the economy, and is not an
economically ``significant regulatory action'' pursuant to section 3(f)
of E.O. 12866. However, the proposed rule is a ``significant''
regulatory action because it would likely raise novel legal or policy
issues. MSHA requests comments on the estimates of costs and benefits
presented in this proposed rule.
MSHA has not prepared a separate preliminary regulatory economic
analysis for this rulemaking. Rather, the analysis is presented below.
B. Industry Profile and Population at Risk
The proposed rule applies to all mines in the United States. MSHA
divides the mining industry into two major sectors based on commodity:
(1) coal mines and (2) metal and nonmetal mines. Each sector is further
divided by type of operation, e.g., underground mines or surface mines.
The Agency maintains data on the number of mines and on mining
employment by mine type and size. MSHA also collects data on the number
of independent contractor firms and their employees. Each independent
contractor is issued one MSHA contractor identification number, but may
work at any mine.
For the 12 months ending January 2010, the average number of mines
in operation was 14,100. These mines employed 297,000 miners, including
contract workers and excluding office workers. There were 8,770 mine
contractor firms with 88,000 employees, excluding office workers. Table
IV-1 presents the total number of all mines and miners, by size of
mine.
Table IV-1--Average 2009 Number of Mines and Employment (Excluding Office Employees), by Employment Size
----------------------------------------------------------------------------------------------------------------
Employment at all
Size of mine All mines mines, excluding office
employees
----------------------------------------------------------------------------------------------------------------
1-19 Employees................................................ 11,816 56,489
20-500 Employees.............................................. 2,234 123,181
501+ Employees................................................ 48 29,402
Contractors................................................... ....................... 87,740
-------------------------------------------------
Total..................................................... 14,098 296,812
----------------------------------------------------------------------------------------------------------------
The estimated value of coal produced in U.S. coal mines in 2009 was
$35.7 billion of which $18.5 billion was from underground coal and
$17.2 billion from surface coal. The value of coal was estimated from
the amount of coal produced and the price of coal. MSHA obtained the
coal production estimates from the Agency's MSIS system and the price
per ton for coal from the Department of Energy (DOE), Energy
Information Administration (EIA), Annual Coal Report 2009, October
2010, Table 28.
The value of the U.S. mining industry's metal and nonmetal (M/NM)
output in 2009 was estimated to be approximately $57.1 billion. Metal
mining contributed an estimated $21.3 billion to the total while the
nonmetal mining sector contributed an estimated $35.8 billion. The
value of production estimates are from U.S. Department of the Interior
(DOI), U.S. Geological Survey (USGS), Mineral Commodity Summaries 2010,
January 2010, page 8.
The combined value of production from all U.S. mines in 2009 was
$92.8 billion. Table IV-2 presents the estimated revenues for all
mines, by size of mine.
Table IV-2--Revenues at All Mines, by Employment Size, in 2009
------------------------------------------------------------------------
Revenues at all mines
Size of mine (million dollars)
------------------------------------------------------------------------
1-19 Employees................................. $17,450
20-500 Employees............................... 54,478
501+ Employees................................. 20,856
------------------------
Total...................................... 92,784
------------------------------------------------------------------------
C. Benefits
Although MSHA does not have an historical basis from which to
estimate the effects of placing a mine on a pattern of violations
(POV), the Agency does have some experience with issuing potential
pattern of violations (PPOV) notifications to operators. MSHA's data
reveal that although most mine operators significantly improve health
and safety conditions at their mines after receiving the PPOV
notification, many later experienced both a decline in health and
safety and an increase in S&S violations.
During June 2007 through September 2009, MSHA made PPOV evaluations
on an average of every six to nine months. During that period, MSHA
sent 68 PPOV notification letters to 62 mine operators (6 operators
received more than one notification). After receiving the notification
letter, of the mines that remained in operation to the next evaluation,
94 percent reduced the rate of S&S citations and orders by at least 30
percent and 77 percent reduced the rate of S&S citations and orders to
levels at or below the national average for similar mines. However, as
discussed previously in the preamble, improvements at some mines
declined over time. Of the 62 mine operators that received PPOV
notification letters during the review period, 6 received a second PPOV
notification letter. In addition to the 6 mines that received two
letters, 7 mines were identified in more than one evaluation as meeting
the
[[Page 5724]]
PPOV criteria but were only sent one letter generally due to mitigating
circumstances. Compliance at 13 of the 62 mines that received PPOV
notification letters (21 percent) deteriorated such that each of these
mines either was sent or could have been sent a second letter.
Under the existing rule, MSHA identifies mines that meet the
screening criteria for PPOV. MSHA conducts a review to determine if
there are mitigating circumstances and issues PPOV notification letters
as appropriate. The proposed rule would delete the screening process as
well as all references to a PPOV.
The proposed rule would establish general criteria that MSHA would
use to identify mines with a pattern of S&S violations. MSHA would post
specific criteria that MSHA would use in making POV determinations,
including a searchable database of mine operator compliance
information, on the Agency's website. Operators would be able to use
the specific criteria and the information in the database to
continually monitor their safety and health performance and determine
whether they are approaching proposed POV criteria levels.
Under the proposed rule, MSHA would allow operators to take
proactive measures to bring their mines into compliance. MSHA would
consider an operator's effective implementation of an MSHA-approved
safety and health management program as a mitigating circumstance when
it comes to placing a mine on a POV.
Under the proposed rule, MSHA projects that operators would
continually monitor their performance and, if they believe that they
are approaching a POV, would take action to improve their safety and
health performance. MSHA projects that, under the proposed rule, most
mine operators who see that their mines are close to a POV would
institute an MSHA-approved safety and health management program to
lessen the probability of being placed on a POV and the possibility of
being issued closures. MSHA projects that this would result in more
mines taking action than those issued PPOV notifications under the
existing procedure.
Closure orders can have a substantial impact on the ability of a
mine to conduct its business. The threat of closure provides a strong
incentive for operators to ensure that S&S violations do not recur.
MSHA projects that few operators would risk such an occurrence.
MSHA projects that under the proposal, which would increase the
frequency of MSHA's review of a mine for a POV from once to twice per
year, on average, approximately 50 mine operators per year would submit
a safety and health management program to MSHA for approval as a
mitigating circumstance. Under the proposed rule, MSHA would allow
operators to take proactive measures to bring their mines into
compliance with MSHA standards and regulations, reducing the
probability of these mines being on a POV. MSHA further projects that
an average of approximately 10 mines per year (i.e., those that would
not take proactive action, such as instituting an MSHA-approved safety
and health management program) would be issued POV notifications. MSHA
requests comments on these estimates which are likely to vary from year
to year.
MSHA used the Agency's experience with PPOV notification letters to
estimate the impact that the proposed mitigating circumstance provision
(including the opportunity for operators to submit safety and health
management programs) would have on the number of nonfatal injuries at
mines. MSHA determined that 62 mines which received PPOV notification
letters (6 received two notifications) during the June 2007 through
September 2009 period experienced, on average, 11 nonfatal injuries
during the year prior to receiving the letter and eight nonfatal
injuries during the year after receiving the letter. MSHA used the one
year period before and after PPOV notification as a basis for
comparison because, as was previously noted, improvements at some mines
declined over time and because a longer period was not available for
some mines (i.e., mines that were issued PPOV notifications in
September 2009).
Based on the projection that 50 mines per year would average three
fewer nonfatal injuries in the first year after implementing an MSHA-
approved safety and health management program, MSHA projects that the
number of nonfatal injuries would be reduced by a minimum of 150 (50
mines x 3 nonfatal injuries per mine) per year. MSHA believes that this
is a low estimate for the following reasons:
It is likely that including measurable benchmarks for
abating specific violations and addressing hazardous conditions in the
MSHA-approved safety and health management programs would make these
programs more effective than the measures that recipients of the PPOV
notification letters have historically instituted.
The estimate does not include any reductions in the number
of fatalities. Because mine fatalities occur on a less frequent basis
than do injuries, the Agency does not believe that it has a reliable
basis upon which to project a reduction in fatalities. However, the
Agency believes that the implementation of an MSHA-approved safety and
health management program would reduce fatalities.
The estimate does not include any projected improvement at
the 10 mines that would not institute an MSHA-approved safety and
health management program and would be placed on a POV. However, due to
the high threshold for getting off a POV under the proposed rule, there
would likely be injury reductions for this category.
MSHA also anticipates longer lasting improvements under the
proposed rule. Of the 62 mines that received PPOV notification letters
from June 2007 through September 2009, 13 did not have a full second
year of data following receipt of the PPOV notification letter. Of the
49 mines that had two full years of data following receipt of the PPOV
notification letter, 19 (39%) experienced an increase in the number of
injuries in the second year following receipt of the PPOV notification
letter compared to the first. MSHA believes that, under the proposed
rule, fewer mines will experience such increases. Mines that have
effectively implemented an MSHA-approved safety and health management
program (to avoid being placed on a POV) would have procedures in place
to continuously address hazardous conditions. Mines that successfully
get off of a POV would have increased incentive (see the cost analysis)
to remain off and would likely institute continuing measures to
minimize violations and address hazardous conditions.
MSHA based its estimates of the monetary values for the benefits
associated with the proposed rule on relevant literature. To estimate
the monetary values of the reductions in nonfatal injuries, MSHA
performed an analysis of the imputed value of injuries avoided based on
a willingness-to-pay approach. This approach relies on the theory of
compensating wage differentials (i.e., the wage premium paid to workers
to accept the risk associated with various jobs) in the labor market. A
number of studies have shown a correlation between higher job risk and
higher wages, suggesting that employees demand monetary compensation in
return for incurring a greater risk.
Viscusi & Aldy (2003) conducted an analysis of studies that use a
willingness-to-pay methodology to estimate the imputed value of life-
saving programs (i.e., meta-analysis) and
[[Page 5725]]
found that the value of each lost work-day injury prevented was
approximately $50,000 in 2000 dollars. Using the GDP Deflator (U.S.
Bureau of Economic Analysis, 2010), this yields an estimate of $62,000
for each lost work-day injury avoided in 2009 dollars.
MSHA recognizes that willingness-to-pay estimates involve
uncertainty and imprecision. Although MSHA is using the Viscusi & Aldy
(2003) study as the basis for monetizing the expected benefits of the
proposed rule, the Agency does so with several reservations, given the
methodological difficulties involved in estimating the compensating
wage differentials (see Hintermann, Alberini, and Markandya, 2008).
Furthermore, these estimates pooled across different industries may not
capture the unique circumstances faced by miners. For example, some
have suggested that the models be disaggregated to account for
different levels of risk, as might occur in coal mining (see Sunstein,
2004). In addition, miners may have few options of alternative
employers and, in some cases, only one employer (near-monopsony or
monopsony) that may depress wages below those in a more competitive
labor market. In the future, MSHA plans to work with other agencies to
refine the approach taken in this proposed rule.
Based on the estimated prevention of 150 nonfatal injuries per
year, the proposed rule would result in monetized benefits of
approximately $9.3 million per year (150 nonfatal injuries x $62,000
per injury). MSHA believes that this is a low estimate for the total
benefits of the proposed rule for the reasons stated above. MSHA
solicits comments on the benefit estimates.
D. Compliance Costs
Proposed Sec. 104.3(c) would require MSHA to issue an order
withdrawing all persons from the affected area of the mine if any S&S
violation is found within 90 days after the issuance of the POV notice.
No one would be allowed to enter the area affected by the violation
until the condition has been abated, except those persons who must
enter the affected area to correct the violation.
Under proposed Sec. 104.3(d), if a withdrawal order is issued
under proposed Sec. 104.3(c), any subsequent S&S violation would
result in an order withdrawing all persons from the affected area of
the mine until the authorized representative of the Secretary
determines that the violation has been abated, except those persons who
must enter the affected area to correct the violation.
Closure orders can have a substantial effect on the ability of a
mine to conduct its business. The threat of closure provides a strong
incentive for operators to ensure that S&S violations do not recur. As
was noted under benefits, MSHA anticipates that few operators would
risk such an occurrence. Rather than risking a POV and the possibility
of a closure, MSHA projects that mine operators would monitor their
compliance record against the proposed POV criteria using the Agency's
website. MSHA estimates that it will take a supervisor an average of 5
minutes each month to monitor each mine's performance using the
Agency's website. Based on the average supervisory wage rate for all
mining in 2009 of $65.05 per hour, MSHA estimates that the yearly cost
for all mine operators to monitor their performance would be about $0.9
million (14,098 mines x 5/60 hours per month x 12 months per year x
$65.05 per hour).
However, MSHA believes that this may be an overestimate. As was
noted above, some operators are currently requesting this information
from MSHA. Making the information available on the Agency's Web site
would reduce the costs for these mine operators. MSHA requests comments
on the burden that monitoring compliance record against the proposed
POV criteria using the Agency's Web site would place on mine operators.
MSHA projects that approximately 50 mine operators each year would
submit a safety and health management program to MSHA for approval as a
mitigating circumstance. MSHA believes that it would take management
working with miners to develop and implement an effective safety and
health management program. MSHA projects that developing such a program
with meaningful and measurable benchmarks would take about 80 hours of
a supervisor's time and 80 hours of miners' time. MSHA projects that it
would take an additional 40 hours of a supervisor's time and 40 hours
of miners' time during the approval process and that the cost for
copying and mailing the program and revisions would be about $100. MSHA
projects it will take 40 hours of a supervisor's time to implementing
the program plus 120 hours of miners' time to run the program (based on
an average size mine in terms of employment).
Although the proposed rule applies to all mining, based on the
Agency's experience and due to the nature of the mining conditions,
MSHA projects that the proposed rule would have a greater impact on
underground coal mining than any other mining sector. During the period
June 2007 through September 2009, underground coal mine operators
received nearly 80 percent of the PPOV notifications. Rather than using
the wage rates for all mining as was done to estimate the costs for
monitoring mine performance, MSHA used the 2009 underground coal mine
hourly wage rates of $84.70 for a supervisor and $35.30 for a miner to
estimate these costs. Since the hourly wage rates in underground coal
mining are higher than those in surface coal and metal/nonmetal mining,
this approach could overstate the estimated costs.
The average cost of developing and implementing an approved safety
and health program at a mine would be approximately $22,100 (160 hours
of a supervisor's time x $84.70 per hour + 240 hours of miners' time x
$35.30 per hour + $100). MSHA anticipates that, each year, the
projected 50 mines that would choose to implement an MSHA-approved
safety and health management program would incur costs of approximately
$1.1 million.
Although MSHA does not have a historical basis from which to
estimate the potential costs that would be incurred by a mine on a POV,
MSHA determined that a good proxy for these costs would be the
potential production lost during mine closures while the operators take
the necessary actions to correct the safety and health violations. MSHA
projects that a typical mine would lose about 0.5 percent of revenue as
the result of closures (about 1 or 2 days for a large mine and a day or
less for a small mine) and that lost revenue due to the closures would
likely vary considerably among mines depending on the specific
conditions in the mine. Some mines would likely incur greater than
average losses while others would incur less than average losses.
As was noted above, based on the Agency's experience and due to the
nature of the mining conditions, MSHA projects that the proposed rule
would affect underground coal mining more than any other mining sector.
MSHA, therefore, used the revenue in the underground coal sector to
estimate potential production losses. The average number of underground
coal mines in operation during a month in 2009 was 424. These mines
generated an estimated $18.5 billion in revenue in 2009, an average of
approximately $43.6 million per mine. One-half percent of an average
mine's revenue is about $218,000.
MSHA estimates that the projected 10 mines that would be on a POV
each year
[[Page 5726]]
would potentially incur about $2.2 million in production losses (10
mines x $218,000 per mine). Since the average revenue per underground
coal mine is significantly higher than the average revenue produced by
a mine in the entire mining industry (i.e., $6.6 million per mine =
$92.8 billion/14,098 mines), this approach could overstate the
estimated costs.
MSHA estimates that the total yearly cost of the proposed rule
would be $4.2 million; $0.9 million for monitoring the performance of
each mine, $1.1 million for 50 mines developing and implementing MSHA-
approved safety and health management programs, plus $2.2 million for
10 mines operating under a POV. MSHA's estimates do not include the
cost of coming into compliance with the underlying regulatory
requirements. Although these costs can be substantial, they were
previously attributed to compliance with MSHA's existing regulations
and are not new compliance costs resulting from the proposed rule. MSHA
solicits comments on the cost estimates.
E. Net Benefits
This section presents a summary of the estimated net benefits of
the proposed rule for informational purposes only. Under the Mine Act,
MSHA is not required to use estimated net benefits as the basis for its
decision to promulgate a rule.
Based on the estimated prevention of 150 nonfatal injuries per
year, MSHA estimates that the proposed rule would result in monetized
benefits of $9.3 million per year (150 nonfatal injuries per year x
$62,000 per injury) compared to estimated costs of $4.2 million per
year, for an estimated net benefit of approximately $5.1 million per
year. MSHA solicits comments on the net benefit estimate.
V. Feasibility
MSHA has concluded that the requirements of the pattern of
violations proposed rule are technologically and economically feasible.
A. Technological Feasibility
MSHA concludes that this proposed rule is technologically feasible.
The proposed rule is not technology-forcing. In order to avoid a POV,
mine operators would have to comply with existing MSHA regulations,
which have previously been determined to be technologically feasible.
B. Economic Feasibility
MSHA also concludes that this proposed rule is economically
feasible. Mine operators can avoid the expenses of being placed on a
pattern of violations by complying with existing MSHA regulations, all
of which have previously been found to be economically feasible. For
those mine operators who are in danger of a POV, MSHA will consider the
institution of an approved safety and health management program as a
mitigating circumstance. MSHA expects few mines (about 10 per year)
would incur the potential expenses associated with closures while on a
POV.
MSHA has traditionally used a revenue screening test--whether the
yearly compliance costs of a regulation are less than one percent of
revenues--to establish presumptively that compliance with the
regulation is economically feasible for the mining community. Based on
this test, MSHA has concluded that the requirements of the proposed
rule are economically feasible. The estimated annual compliance costs
of the proposed rule to mine operators are $4.2 million, which are
insignificant compared to total annual revenue of $92.8 billion for the
mining industry (i.e., significantly less that one percent of the
mining industry's $92.8 billion revenue, which is $928 million). Even
if all of the costs were borne by the underground coal industry, the
estimated $4.2 million cost of the proposed rule is about 0.02 percent
of the underground coal industry's 2009 revenue of $18.5 billion. MSHA,
therefore, concludes that compliance with the provisions of the
proposed rule would be economically feasible for the mining industry.
VI. Regulatory Flexibility Act and Small Business Regulatory
Enforcement Fairness Act (SBREFA)
Pursuant to the Regulatory Flexibility Act (RFA) of 1980, as
amended by SBREFA, MSHA has analyzed the impact of the proposed rule on
small businesses. Based on that analysis, MSHA has notified the Chief
Counsel for Advocacy, Small Business Administration (SBA), and made the
certification under the RFA at 5 U.S.C. 605(b) that the proposed rule
would not have a significant economic impact on a substantial number of
small entities. The factual basis for this certification is presented
below.
A. Definition of a Small Mine
Under the RFA, in analyzing the impact of the proposed rule on
small entities, MSHA must use the SBA definition for a small entity or,
after consultation with the SBA Office of Advocacy, establish an
alternative definition for the mining industry by publishing that
definition in the Federal Register for notice and comment. MSHA has not
taken such an action and is required to use the SBA definition. The SBA
defines a small entity in the mining industry as an establishment with
500 or fewer employees.
In addition to examining small entities as defined by SBA, MSHA has
also looked at the impact of this proposed rule on mines with fewer
than 20 employees, which MSHA and the mining community have
traditionally referred to as ``small mines.'' These small mines differ
from larger mines not only in the number of employees, but also in
economies of scale in material produced, in the type and amount of
production equipment, and in supply inventory. The costs of complying
with the proposed rule and the impact of the proposed rule on small
mines will also be different. It is for this reason that small mines
are of special concern to MSHA.
MSHA concludes that it can certify that the proposed rule would not
have a significant economic impact on a substantial number of small
entities that would be covered by this proposed rule. The Agency has
determined that this is the case both for mines with fewer than 20
employees and for mines with 500 or fewer employees.
B. Factual Basis for Certification
Mine operators can avoid the expenses of being placed on a POV by
complying with MSHA regulations. Under the proposed rule, MSHA will
consider the institution of an approved safety and health management
program as a mitigating circumstance for those mine operators who are
placed on a pattern. MSHA expects few mines (about 10 per year) would
incur the potential expenses associated with closure orders under a
POV.
MSHA initially evaluates the impacts on ``small entities'' by
comparing the estimated compliance costs of a rule for small entities
in the sector affected by the rule to the estimated revenues for the
affected sector. When estimated compliance costs are less than one
percent of the estimated revenues, the Agency believes it is generally
appropriate to conclude that there is no significant economic impact on
a substantial number of small entities. When estimated compliance costs
exceed one percent of revenues, MSHA investigates whether a further
analysis is required. Since it was not possible to accurately project
the distribution of mines that would incur the estimated $4.2 million
to comply with the proposed rule by commodity and size, MSHA examined
the impact using several alternative assumptions.
[[Page 5727]]
The average number of mines in operation during a month in 2009
with 500 or fewer employees was 14,050. These mines generated an
estimated $71.9 billion in revenue in 2009. Even if all of the costs
were incurred by mines with 500 or fewer employees, the estimated $4.2
million in compliance costs would be less than 0.006 percent of the
revenue generated by all small mines according to the SBA's definition.
The average number of underground coal mines in operation during a
month in 2009 with 500 or fewer employees was 412. These mines
generated an estimated $13.7 billion in revenue in 2009. Even if all of
the costs were incurred by underground coal mines with 500 or fewer
employees, the $4.2 million in compliance costs would be about 0.03
percent of the revenue generated by small underground coal mines
according to the SBA's definition.
The average number of mines in operation during a month in 2009
with 1-19 employees was 11,816. These mines generated an estimated
$17.4 billion in revenue in 2009. Even if all of the costs were
incurred by mines with 1-19 employees, the estimated $4.2 million
compliance costs would be about 0.02 percent of the revenue generated
by all small mines with fewer than 20 employees.
The average number of underground coal mines in operation during a
month in 2009 with 1-19 employees was 81. These mines generated an
estimated $920 million in revenue in 2009. Even if all of the $4.2
million in compliance costs were incurred by underground coal mines
with 1-19 employees, the costs would be about 0.45 percent of the
revenue generated by small underground coal mines with fewer than 20
employees.
Moreover, mine operators can avoid any costs associated with being
on a POV simply by complying with the law. If an operator has trouble
complying and is in danger of being on POV, under the proposed rule,
the implementation of an approved safety and health management program
would serve as a mitigating circumstance.
Accordingly, MSHA has certified that the proposed rule would not
have a significant economic impact on a substantial number of small
entities.
VII. Paperwork Reduction Act of 1995
A. Summary
This proposed rule contains a collection-of-information requirement
subject to review and approval by OMB under the Paperwork Reduction Act
(PRA). MSHA estimates that under the proposed rule about 50 mines each
year would develop and implement approved safety and health management
programs. This would impose information collection requirements related
to mitigating circumstances under proposed Sec. 104.2(a)(8).
MSHA expects that developing an approved program with meaningful
and measurable benchmarks would take about 160 hours of a supervisor's
time at an hourly wage of $84.70 and 240 hours of miners' time at an
hourly wage of $35.30. Costs for copying and mailing the program and
revisions are estimated to be $100 per program.
The burden of developing and implementing an approved safety and
health program is 400 hours per mine (160 + 240) and the average cost
is approximately $22,100 (160 hours of a supervisor's time x $84.70 per
hour + 240 hours of miners' time x $35.30 per hour + $100).
Burden Hours: 50 mines x 400 hours per mine = 20,000 hours.
Burden Costs: 50 mines x $100 per mine = $5,000.
B. Procedural Details
The information collection package for this proposed rule has been
submitted to OMB for review under 44 U.S.C. 3504, paragraph (h) of the
Paperwork Reduction Act of 1995, as amended (44 U.S.C. 3501 et seq.).
MSHA requests comments to:
Evaluate whether the proposed collection of information is
necessary for the proper performance of the functions of the agency,
including whether the information will have practical utility;
Evaluate the accuracy of the Agency's estimate of the
burden of the proposed collection of information, including the
validity of the methodology and assumptions used;
Enhance the quality, utility, and clarity of the
information to be collected; and
Minimize the burden of the collection of information on
those who are to respond, including through the use of appropriate
automated, electronic, mechanical, or other technological collection
techniques or other forms of information technology, e.g., permitting
electronic submission of responses.
Comments on the information collection requirements should be sent
to both OMB and MSHA. Addresses for both offices can be found in the
ADDRESSES section of this preamble. The regulated community is not
required to respond to any collection of information unless it displays
a current, valid, OMB control number. MSHA displays the OMB control
numbers for the information collection requirements in its regulations
in 30 CFR part 3.
VIII. Other Regulatory Considerations
A. The Unfunded Mandates Reform Act of 1995
MSHA has reviewed the proposed rule under the Unfunded Mandates
Reform Act of 1995 (2 U.S.C. 1501 et seq.). MSHA has determined that
this proposed rule would not include any federal mandate that may
result in increased expenditures by State, local, or tribal
governments; nor would it increase private sector expenditures by more
than $100 million in any one year or significantly or uniquely affect
small governments. Accordingly, the Unfunded Mandates Reform Act of
1995 requires no further Agency action or analysis.
B. Executive Order 13132: Federalism
This proposed rule would not have ``federalism implications''
because it would not ``have substantial direct effects 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.'' Accordingly, under E.O. 13132, no further
Agency action or analysis is required.
C. The Treasury and General Government Appropriations Act of 1999:
Assessment of Federal Regulations and Policies on Families
Section 654 of the Treasury and General Government Appropriations
Act of 1999 (5 U.S.C. 601 note) requires agencies to assess the impact
of Agency action on family well-being. MSHA has determined that this
proposed rule would have no effect on family stability or safety,
marital commitment, parental rights and authority, or income or poverty
of families and children. This proposed rule impacts only the mining
industry. Accordingly, MSHA certifies that this proposed rule would not
impact family well-being.
D. Executive Order 12630: Government Actions and Interference With
Constitutionally Protected Property Rights
The proposed rule woul