National Appeals Office Rules of Procedure, 33980-33985 [2012-13979]

Agencies

• DEPARTMENT OF COMMERCE
• National Oceanic and Atmospheric Administration

[Federal Register Volume 77, Number 111 (Friday, June 8, 2012)]
[Proposed Rules]
[Pages 33980-33985]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2012-13979]


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DEPARTMENT OF COMMERCE

National Oceanic and Atmospheric Administration

15 CFR Part 906

[Docket. No 101019524-2112-01]
RIN 0648-BA36


National Appeals Office Rules of Procedure

AGENCY: National Marine Fisheries Service (NMFS), National Oceanic and 
Atmospheric Administration (NOAA), Commerce.

ACTION: Proposed rule; request for comments.

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SUMMARY: This proposed rule would establish procedures governing the 
National Appeals Office (NAO), a division of NMFS' Office of Management 
and Budget within NOAA. NAO's central mission is to provide an 
efficient means of adjudicating appeals by providing due process and 
consistency to NMFS' administrative decisions. This proposed rule would 
establish a process by which NMFS could review, and if necessary 
correct, decisions about certain limited access privilege programs 
under Section 303A of the Magnuson-Steven Fishery Conservation and 
Management Act. The proposed procedures could also be used to 
adjudicate appeals from other offices that incorporate these rules into 
their regulations or otherwise notify potential appellants of the 
procedures' applicability to their proceedings.

DATES: NMFS invites interested persons to submit comments on this 
proposed rule. To ensure consideration, comments must be in writing and 
must be received by July 9, 2012.

ADDRESSES: You may submit comments, identified by NOAA-NMFS-2011-0266, 
by one of the following methods:
     Electronic Submission: Submit all electronic public 
comments via Federal e-Rulemaking Portal at www.regulations.gov. To 
submit comments via the e-Rulemaking Portal, first click the ``submit a 
comment'' icon, then enter NOAA-NMFS-2011-0266 in the keyword search. 
Locate the document you wish to comment on from the resulting list and 
click on the ``Submit a Comment'' icon on the right of that line.
     Mail: Submit written comments to Steven Goodman, National 
Appeals Office, Office of Management and Budget, NMFS, 1315 East West 
Hwy., Room 9553, Silver Spring, MD 20910.
     Fax: 301-713-2384; Attn: Steven Goodman.

Instructions: Comments must be submitted by one of the above methods to 
ensure that the comments are received, documented, and considered by 
NMFS. Comments sent by any other method, to any other address or 
individual, or received after the end of the comment period, may not be 
considered. All comments received are a part of the public record and 
will generally be posted for public viewing on www.regulations.gov 
without change. All personal identifying information (e.g., name, 
address, etc.) submitted voluntarily by the sender will be publicly 
accessible. Do not submit confidential business information, or 
otherwise sensitive or protected information. NMFS will accept 
anonymous comments (enter ``N/A'' in the required fields if you wish to 
remain anonymous). Attachments to electronic comments will be accepted 
in Microsoft Word or Excel, WordPerfect, or Adobe PDF file formats 
only.

FOR FURTHER INFORMATION CONTACT: Steven Goodman, National Appeals 
Office, Office of Management & Budget, NMFS, 1315 East West Hwy., Room 
9553, Silver Spring, MD 20910; nmfs.nao.contact@noaa.gov; (301) 427-
8774. (This is not a toll-free number.) Individuals with hearing or 
speech impairments may access the telephone number above via TTY by 
calling the Federal Information Relay Service at (800) 877-8339.

SUPPLEMENTARY INFORMATION: 

Background

    In 2007, Congress added section 303A to the Magnuson-Stevens 
Fishery Conservation and Management Act (MSA). Section 303A authorizes 
limited access privilege programs (LAPP) and requires NMFS to ``include 
an appeals process for administrative review of the Secretary's 
decisions regarding initial

[[Page 33981]]

allocation of limited access privileges.'' Most of the appeals 
processes currently used by NMFS pre-date the new MSA requirement. 
Further, the current infrastructure for LAPP appeals does not achieve 
optimum economies of scale, or efficient use of resources.
    LAPPs may provide benefits to certain members of the public, while 
excluding others. Thus, a transparent, unbiased and clear appeals 
process is essential. LAPP applicants across the country should be 
provided with a uniform level of due process and consistent procedures 
for filing and deciding appeals. Further, a robust administrative 
appeals process provides a means for an agency to make corrections and 
avoid costly litigation. Accordingly, NMFS is proposing to adopt 
procedural regulations at 15 CFR part 906, which would designate NAO, a 
division within NMFS Office of Management and Budget, as adjudicator 
for all future appeals arising under section 303A of the MSA. NAO may 
also be used for other Department of Commerce adjudications if the 
proposed regulations are adopted by regulation or other means and 
potential appellants are given notice. For example, other programs that 
may opt into the NAO process may include the Alaska Charter Halibut 
Limited Access Program or the North Pacific Groundfish Observer 
Program.
    NAO adjudicates initial administrative determinations, defined in 
the proposed rule as agency actions that directly and adversely affect 
an appellant. Typically, although not exclusively, NAO proceedings are 
for appeals of denials of permits or other limited access privileges. 
The proposed rule does not encompass proceedings made available 
pursuant to 15 CFR part 904. The regulations at 15 CFR part 904 are for 
administrative proceedings over cases involving a Notice of Violation 
and Assessment of civil penalty, permit sanctions, written warnings, or 
seizure and forfeiture of property for violating 34 statutes NOAA 
enforces. The regulations codified at 15 CFR part 904 provide distinct 
procedures, including a different administrative process that includes 
the agency as a party to an appeal.
    The proposed action should avoid future unnecessary costs and 
redundancies through a centralized administrative appeals process for 
review of initial administrative determinations. A centralized system 
for adjudicating appeals is more cost effective than duplicating the 
appeals function in each region. Historically, administrative appeals 
were processed by NMFS' regional offices. Each NMFS region has had a 
different structure and process for resolving appeals.
    The proposed action will promote consistency in decision making and 
responsiveness to due process considerations. A centralized office will 
use experienced, full-time adjudicators to decide appeals, and programs 
would benefit from their collective experience and institutional 
memory. A cadre of experienced and well-trained appellate officers 
would free other employees to use their time performing duties within 
their area of expertise. Under the current proposal, NAO could 
adjudicate appeals in one location. This will allow for economies of 
scale and freeing-up of resources for use in regional offices.
    Typically, NAO will be used for informal administrative appeals. 
The proposed rule allows flexibility in determining what type and how 
many pre-hearing conferences are needed. An appellate officer has the 
discretion to hold a scheduling and/or pre-hearing conference if he or 
she thinks one is needed to materially advance the proceeding. An 
appellate officer's discretion in determining whether to hold a 
scheduling and/or pre-hearing conference will be guided by the 
following: settlement, if allowed under applicable law; clarification 
of the issues under review; stipulations; hearing(s) date, time, and 
location; identification of witnesses for the hearing(s); development 
of the NAO case record, and; other matters that may aid in the 
disposition of the proceedings.
    Hearings are also held at the discretion of an appellate officer or 
if the appellate officer considers such hearing will materially advance 
his or her evaluation of the issues under appeal. In determining 
whether to hold a hearing, an appellate officer's discretion will be 
guided by whether the appellate officer believes oral testimony is 
required to resolve a material issue of fact or whether oral 
presentation is needed to probe a party's position on a material issue 
of law. Conferences and hearings may be in person, but more likely, 
they will be held by telephone or by other electronic means. The rule 
does not bar face-to-face hearings, but it is not intended to require 
expenditure of funds in order for an appellant to participate, or at 
its discretion, the agency to participate, in a hearing.
    The proposed regulations address operations as well as events that 
occur during the course of adjudicating an appeal filed with NAO. The 
proposed rule provides who may file, how and when to initiate an 
appeal, and what constitutes the agency record and transmittal for 
inclusion in the NAO case record for the appeal. During a hearing and 
while the record is open, the appellate officer determines whether 
additional evidence should be admitted in the NAO case record. The 
proposed rule prohibits ex parte communications, but clarifies that 
non-substantive communications or communications about procedural 
matters are permissible. The proposed rule establishes time frames and 
deadlines for actions to ensure a reasonably expeditious review, and 
while that may be modified, that would not be the norm.
    NAO will produce written decisions upholding or reversing the 
administrative determination under review. The proposed rule 
establishes parameters for written decisions. The appellant has the 
burden of proving by a preponderance of the evidence that he or she 
should prevail. Thus it is incumbent upon the appellant to garner and 
present evidence to support his or her claim.
    Generally, under the proposed rule a decision issued by NAO becomes 
final 30 days after issuance. The effective date of the final decision 
is subject to delay for reconsideration by NAO, or review by a Regional 
Administrator of NMFS or other appropriate official. NAO will follow 
applicable federal law and policy which may include publishing NAO and 
Regional Administrator decisions on NAO's Web site.

Classifications

Regulatory Flexibility Act

    The Chief Counsel for Regulation of the Department of Commerce 
certified to the Chief Counsel for Advocacy of the Small Business 
Administration that this proposed rule, if adopted, would not have a 
significant economic impact on a substantial number of small entities. 
This regulation does not create any new regulatory requirements, but 
instead codifies procedural rules for certain administrative 
adjudication proceedings. The proposed rule would not create any new 
obligations for small entities; rather, it would ensure a standardized 
and centralized appeals process for decisions regarding initial 
allocation of limited access privileges. As a result, any potential 
economic impact on small entities would be nominal. While it is 
possible that a substantial number of small entities could participate 
in the adjudication proceedings, the procedures being established here 
would not have a significant economic impact on those entities. 
Implementing standardized rules could actually reduce the

[[Page 33982]]

economic burden on small entities by providing procedural certainty to 
the parties participating in the proceedings.
    Because this proposed rule, if enacted, would not have a 
significant impact on a substantial number of small entities, an 
initial regulatory flexibility analysis is not required and none has 
been prepared.

Executive Order 12866

    This proposed rule has been determined to be not significant for 
purposes of Executive Order 12866.

List of Subjects in 15 CFR Part 906

    Administrative appeals, Administrative practice and procedure, 
Fisheries.


    Dated: June 4, 2012.
Alan D. Risenhoover,
Acting Deputy Assistant Administrator for Regulatory Programs, National 
Marine Fisheries Service.
    For reasons stated in the preamble, NMFS proposes to add 15 CFR 
part 906 as follows:

PART 906--NATIONAL APPEALS OFFICE RULES OF PROCEDURE

Sec.
906.1 Purpose and scope.
906.2 Definitions.
906.3 Requesting an appeal and agency record.
906.4 General filing requirements.
906.5 Service.
906.6 Ex parte communications.
906.7 Disqualification of appellate officer.
906.8 Scheduling and pre-hearing conferences.
906.9 Exhibits.
906.10 Evidence.
906.11 Hearing.
906.12 Closing the evidentiary portion of the NAO case record.
906.13 Failure to appear.
906.14 Burden of proof.
906.15 Decisions.
906.16 Reconsideration.
906.17 Review by the Regional Administrator.
906.18 Implementation of final decisions.

    Authority: 16 U.S.C. 1801 et seq.; 16 U.S.C. 1374, 1375 & 1416; 
16 U.S.C. 1540; 16 U.S.C. 773f; 16 U.S.C. 973f; 16 U.S.C. 1174; 16 
U.S.C. 2437; 16 U.S.C. 4013; 16 U.S.C. 5507; 16 U.S.C. 7009; 16 
U.S.C. 3637; 16 U.S.C. 5103 & 5106; 16 U.S.C. 5154 & 5158; 16 U.S.C. 
6905, and; 16 U.S.C. 5010.


Sec.  906.1  Purpose and scope.

    (a) This part sets forth the procedures governing proceedings 
before the National Appeals Office (NAO). These procedures provide 
standard rules of practice for administrative adjudications by NAO.
    (b) NAO will adjudicate appeals of initial administrative 
determinations in limited access privilege programs developed under 
section 303A of the Magnuson-Stevens Fishery Conservation and 
Management Act (MSA) and approved after the effective date of these 
regulations. Those appeals are informal proceedings.
    (c) The procedures contained in this part may be incorporated by 
reference in rules or regulations other than those promulgated pursuant 
to section 303A of the MSA. The Secretary may also request that NAO 
adjudicate appeals in any matter in controversy that requires findings 
of fact and conclusions of law, and other quasi-judicial matters that 
the Secretary deems appropriate, consistent with existing regulations. 
The Secretary shall provide notice to potential appellants and to any 
affected party in these other matters through regulations or actual 
notice.


Sec.  906.2  Definitions.

    Agency record means all material and information, including 
electronic, the office that issued the initial administrative 
determination relied on or considered in reaching its decision, or 
which otherwise is related to the initial administrative determination.
    Appeal means an appellant's petition to appeal an initial 
administrative determination and all administrative processes of the 
National Appeals Office related thereto.
    Appellant means a person who receives an initial administrative 
determination and appeals it to the National Appeals Office.
    Appellate officer means an individual designated by the Chief of 
the National Appeals Office to adjudicate the appeal. The term may 
include the Chief of the National Appeals Office.
    Day means calendar day unless otherwise specified by the Chief of 
the National Appeals Office. When computing any time period specified 
under these rules, count every day, including intermediate Saturdays, 
Sundays, and legal holidays.
    Department or DOC means the Department of Commerce.
    Ex parte communication means any oral or written communication 
about the merits of a pending appeal between one party and the National 
Appeals Office with respect to which reasonable prior notice to all 
parties is not given. However, ex parte communication does not include 
inquiries regarding procedures, scheduling, and status.
    Initial Administrative Determination or IAD means a determination 
made by an official of the National Marine Fisheries Services that 
directly and adversely affects a person's ability to hold, acquire, 
use, or be issued a limited access privilege. The term also includes 
determinations issued pursuant to other federal law, for which review 
has been assigned to the National Appeals Office by the Secretary.
    NAO means the National Appeals Office, an adjudicatory body within 
the Office of Management and Budget, National Marine Fisheries Service, 
National Oceanic and Atmospheric Administration, Department of 
Commerce. The term generally means all NAO personnel, including 
appellate officers.
    NAO case record means the Agency record and all additional 
documents and other materials related to an appeal and maintained by 
NAO in a case file.
    NMFS means the National Marine Fisheries Service, National Oceanic 
and Atmospheric Administration, Department of Commerce.
    National Oceanic and Atmospheric Administration or NOAA means the 
National Oceanic and Atmospheric Administration, Department of 
Commerce.
    Party means a person who files a petition for appeal with NAO. It 
can also mean an office that issued the IAD if that office participates 
in the NAO appeal.
    Person means any individual (whether or not a citizen or national 
of the United States), corporation, partnership, association, or other 
entity (whether or not organized or existing under the laws of any 
State), and any Federal, State, or local, or foreign government or 
entity of any such government.
    Regional Administrator means the administrator of one of six 
regions of NMFS: Northeast, Southeast, Northwest, Southwest, Alaska, or 
Pacific Islands. The term also includes an official with similar 
authority within the DOC, such as the Director of NMFS' Office of 
Sustainable Fisheries.
    Representative means an individual properly authorized by an 
Appellant in writing to act for the Appellant in conjunction with an 
appeal pending in NAO. The representative does not need to be a 
licensed attorney.
    Secretary means the Secretary of Commerce or a designee.


Sec.  906.3  Requesting an appeal and agency record.

    (a) Who May File. Any person who receives an initial administrative 
determination.
    (b) Petition to Appeal. (1) To request an appeal, a person shall 
submit a written petition of appeal to NAO.
    (2) The petition shall include a copy of the initial administrative 
determination the person wishes to appeal.

[[Page 33983]]

    (3) In the petition, the person shall state how the initial 
administrative determination directly and adversely affects him or her, 
why he or she believes the initial administrative determination is 
wrong, and whether he or she requests a hearing or prefers that an 
appellate officer make a decision based on the NAO case record and 
without a hearing.
    (i) Arguments not raised by the person in his or her petition to 
appeal will be deemed waived.
    (ii) The petition may include additional documentation in support 
of the appeal.
    (4) If a person requests a hearing, the written request must 
include a concise statement raising genuine and substantial issues of a 
material fact or law that cannot be resolved based on the documentary 
evidence.
    (5) In the petition, a person shall state whether the person has a 
representative, and if so, the name, address, and telephone number for 
the representative.
    (c) Address of record. In the petition the person shall identify 
the address of record. Documents directed to the appellant will be 
mailed to the address of record, unless the appellant provides NAO and 
other parties with any changes to his or her address in writing.
    (1) The address of record may include a representative's address.
    (2) NAO bears no responsibility if the appellant or his or her 
representative does not receive documents because appellant or his or 
her representative changes his or her address without proper 
notification to NAO.
    (3) NAO bears no responsibility if the appellant or his or her 
representative fail to retrieve documents upon notification from the 
United States Postal Service or commercial carrier.
    (4) NAO will presume that documents addressed to an address of 
record and properly mailed or given to a commercial carrier for 
delivery are received.
    (d) Place of filing. The petition must be transmitted via 
facsimile. The facsimile number is: 301-713-2384. If the person filing 
the petition does not have access to a fax machine, he or she may file 
the petition by mail or commercial carrier to Chief, National Appeals 
Office, 1315 East-West Hwy., Room 9552, Silver Spring, MD 20910.
    (e) Time limitations. A petition must be filed within 45 days after 
the date the initial administrative determination is issued unless a 
shorter or longer filing timeframe is explicitly specified in the 
regulations governing the initial administrative determination.
    (f) Agency record. (1) Within 20 days of receipt of the copy of the 
petition to appeal, the office that issued the initial administrative 
determination that is the subject of the appeal shall transmit the 
agency record to NAO.
    (2) The office that issued the initial administrative determination 
shall organize the pages of the agency record in chronological order.
    (g) Agency participation in appeal. The office responsible for the 
initial administrative determination shall have 20 days from the date 
it receives a copy of the petition to appeal to provide NAO with 
written notice that it will be a party to the appeal.


Sec.  906.4  General filing requirements.

    (a) Date of filing. Filing refers to providing documents to NAO.
    (1) All documents filed on behalf of an appellant or related to an 
appeal shall be submitted to NAO via facsimile.
    (2) If the person filing does not have access to a fax machine, he 
or she may file by regular mail or commercial carrier to Chief, 
National Appeals Office, 1315 East-West Hwy., Room 9552, Silver Spring, 
MD 20910.
    (3) A document transmitted to NAO is considered filed upon receipt 
of the entire submission by 5 p.m. Eastern Time at NAO.
    (b) Copies. At the time of filing a submission to NAO, the filing 
party shall serve a copy thereof on every other party, unless otherwise 
provided for in these rules.
    (c) Retention. All submissions to NAO become part of a NAO case 
record.
    (d) Computation of time. When computing any time period specified 
under these rules, count every day, including intermediate Saturdays, 
Sundays, and legal holidays. If the date that ordinarily would be the 
last day for filing with NAO falls on a Saturday, Sunday, or Federal 
holiday, or a day NAO is closed, the filing period will include the 
first NAO workday after that date.
    (e) Extension of time. (1) When a submission is required to be 
filed within a prescribed time, a party may request, in writing, an 
extension of time to file the submission, citing the specific reason or 
reasons for the need of an extension of time. A party may not request 
an extension of time to file the submission after the deadline to file 
the submission has passed.
    (2) NAO may grant the extension if an appellate officer determines 
good cause for an extension of time has been established by the party.


Sec.  906.5  Service.

    (a) Service refers to providing documents to parties to an appeal. 
(1) Service of documents may be made by first class mail (postage 
prepaid), facsimile, or commercial carrier, or by personal delivery to 
a party's address of record.
    (2) Service of documents will be considered effective upon the date 
of postmark (or as otherwise shown for government-franked mail), 
facsimile transmission, delivery to a commercial carrier, or upon 
personal delivery.
    (b) A party shall serve a copy of all documents to all other 
parties and shall file a copy of all documents with NAO the same 
business day.
    (c) NAO may serve documents by electronic mail.


Sec.  906.6  Ex parte communications.

    (a) Communication with NAO, including appellate officers, 
concerning procedures, scheduling, and status is permissible.
    (b) Ex parte communication between NAO and the parties about the 
merits of a pending appeal is not permissible unless all parties have 
been given reasonable notice and an opportunity to participate in the 
communication.
    (c) If NAO receives an ex parte communication, NAO shall document 
the communication and any responses thereto in the NAO case record. If 
the ex parte communication was in writing, NAO shall place a copy of 
the communication in the NAO case record. If the ex parte communication 
was oral, NAO shall prepare a memorandum stating the substance of the 
oral communication, which will then be included in the NAO case record. 
NAO will provide copies of any such materials included in the NAO case 
record under this paragraph to the parties to the appeal.
    (d) NAO may require a party to show cause why such party's claim or 
interest in the appeal should not be dismissed, denied, disregarded, or 
otherwise adversely affected because of an ex parte communication as 
described in paragraphs (b) and (c) of this section.
    (e) This rule may be suspended by NAO during an alternative dispute 
resolution process.


Sec.  906.7  Disqualification of appellate officer.

    (a) An appellate officer shall disqualify him or herself if the 
appellate officer has a perceived or actual conflict of interest, a 
perceived or actual prejudice or bias, for other ethical reasons, or 
based on principles found in the American Bar Association Model Code of 
Judicial Conduct for Administrative Law Judges.
    (b) Any party may request an appellate officer, at any time before 
the

[[Page 33984]]

filing of the appellate officer's decision, to withdraw on the ground 
of personal bias or disqualification, by filing a written motion with 
the appellate officer setting forth in detail the matters alleged to 
constitute grounds for disqualification.
    (c) The appellate officer, orally or in writing, shall grant or 
deny the motion based on the American Bar Association Model Code of 
Judicial Conduct for Federal Administrative Law Judges and other 
applicable law or policy. If the motion is granted, the appellate 
officer will disqualify himself or herself and withdraw from the 
proceeding. If the motion is denied, the appellate officer will state 
the grounds for his or her ruling and proceed with his or her review.


Sec.  906.8  Scheduling and pre-hearing conferences.

    (a) NAO may convene a scheduling and/or pre-hearing conference if, 
for example, an appellate officer in his or her discretion finds a 
conference will materially advance the proceeding.
    (b) NAO shall notify the parties in writing 10 days prior to a 
conference unless the Chief of NAO orders a shorter period of time for 
providing notice or conducting a conference.
    (c) The following will guide an appellate officer in determining 
whether to exercise his or her discretion to hold a scheduling and/or 
pre-hearing conference.
    (1) Settlement, if possible under applicable law;
    (2) Clarifying the issues under review;
    (3) Stipulations;
    (4) Hearing(s) date, time, and location;
    (5) Identifying witnesses for the hearing(s);
    (6) Development of the NAO case record, and;
    (7) Other matters that may aid in the disposition of the 
proceedings.
    (d) NAO may record the conference.
    (e) Format. At the discretion of the appellate officer, conferences 
may be conducted by telephone, in person, or by teleconference or 
similar electronic means.
    (f) NAO may issue an order showing the matters disposed of in the 
conference and may include in the order other matters related to the 
appeal.


Sec.  906.9  Exhibits.

    (a) The parties shall mark all exhibits in consecutive order in 
whole Arabic numbers and with a designation identifying the party 
submitting the exhibit(s).
    (b) Parties shall exchange all exhibits that will be offered at the 
hearing at least 10 days before the hearing.
    (c) Parties shall provide all exhibit(s) to NAO at least 10 days 
before the hearing.
    (d) NAO may modify the timeframe for exchanging or submitting 
exhibits if an appellate officer determines good cause exists.
    (e) NAO may deny the admission into evidence of exhibits that are 
not marked and exchanged pursuant to this rule.
    (f) Each exhibit offered in evidence or marked for identification 
shall be filed and retained in the NAO case record.


Sec.  906.10  Evidence.

    (a) The Federal Rules of Evidence do not apply to NAO proceedings.
    (b) NAO will decide whether to admit evidence into the NAO case 
record.
    (1) An appellate officer may exclude unduly repetitious, 
irrelevant, and immaterial evidence. An appellate officer may also 
exclude evidence to avoid undue prejudice, confusion of the issues, 
undue delay, waste of time, or needless presentation of cumulative 
evidence.
    (2) An appellate officer may consider hearsay evidence.
    (c) Copies of documents may be offered as evidence, provided they 
are of equal legibility and quality as the originals, and such copies 
shall have the same force and effect as if they were originals. If an 
appellate officer so directs, a party shall submit original documents 
to the appellate officer.
    (d) An appellate officer may take official notice of Federal or 
State public records and of any matter of which courts may take 
judicial notice.
    (e) An appellate officer may contact the program office that issued 
the initial administrative determination in the case before the 
appellate officer in order to obtain the interpretation(s) of the law 
and regulation(s) made by the program office and applied to the facts 
in the case. The program office will provide to NAO the 
interpretation(s) of the law and regulation(s) made by that office in 
the case.


Sec.  906.11  Hearing.

    (a) Procedures. (1) An appellate officer in his or her discretion 
may order a hearing taking into account the information provided by an 
Appellant pursuant to Sec.  906.3(b)(3) or if an appellate officer 
considers that a hearing will materially advance his or her evaluation 
of the issues under appeal. In exercising his or her discretion, an 
appellate officer may consider whether oral testimony is required to 
resolve a material issue of fact or whether oral presentation is needed 
to probe a party's position on a material issue of law. If an appellate 
officer determines that a hearing is not necessary, then the appellate 
officer will base his or her decision on the NAO case record. In the 
absence of a hearing an appellate officer may, at his or her 
discretion, permit the parties to submit additional materials for 
consideration.
    (2) If an appellate officer convenes a hearing, the hearing will be 
conducted in the manner determined by NAO most likely to obtain the 
facts relevant to the matter or matters at issue.
    (3) NAO shall schedule the date, time and place for the hearing. 
NAO will notify the parties in writing of the hearing date, time and 
place at least 10 days prior to the hearing unless the Chief of NAO 
orders a shorter period for providing notice or conducting the hearing.
    (4) At the hearing, all testimony will be under oath or affirmation 
administered by an appellate officer. In the event a party or a witness 
refuses to be sworn or refuses to answer a question, an appellate 
officer may state for the record any inference drawn from such refusal.
    (5) An appellate officer may question the parties and the 
witnesses.
    (6) An appellate officer will allow time for parties to present 
argument, question witnesses and other parties, and introduce evidence.
    (7) Parties may not compel discovery or the testimony of any 
witness.
    (b) Recording. An appellate officer may record the hearing.
    (c) Format. At the discretion of NAO, hearings may be conducted by 
telephone, in person, or by teleconference or similar electronic means.


Sec.  906.12  Closing the evidentiary portion of the NAO case record.

    (a) At the conclusion of the NAO proceedings, an appellate officer 
will establish the date upon which the evidentiary portion of the NAO 
case record will close. Once an appellate officer closes the 
evidentiary portion of the NAO case record, with or without a hearing, 
no further submissions or argument will be accepted into the NAO case 
record.
    (b) NAO in its discretion may reopen the evidentiary portion of the 
NAO case record or request additional information from the parties at 
anytime.


Sec.  906.13  Failure to appear.

    If any party fails to appear at a pre-hearing conference or hearing 
after proper notice, an appellate officer may:
    (a) Dismiss the case, or;
    (b) Deem the failure of a party to appear after proper notice a 
waiver of any right to a hearing and consent to the

[[Page 33985]]

making of a decision based on the NAO case record.


Sec.  906.14  Burden of proof.

    On issues of fact, the appellant bears the burden of proving he or 
she should prevail by a preponderance of the evidence. Preponderance of 
the evidence is the relevant evidence in the NAO case record, 
considered as a whole, that a reasonable person would accept as 
sufficient to find a contested fact is more likely than not. Appellant 
has the obligation to obtain and present evidence to support the claims 
in his or her petition.


Sec.  906.15  Decisions.

    (a) After an appellate officer closes the evidentiary portion of 
the NAO case record, NAO will issue a written decision that is based on 
the NAO case record. In making a decision, NAO shall determine whether 
the appellant has shown by a preponderance of the evidence that the 
initial administrative determination is inconsistent with applicable 
laws and regulations. In making a decision, NAO shall give deference to 
the reasonable interpretation(s) of applicable ambiguous laws and 
regulations made by the office issuing in the initial administrative 
determination.
    (b) At any time before a decision is implemented pursuant to Sec.  
906.18, NAO may issue a corrected decision.
    (c) NAO shall serve a copy of its decision upon the appellant and 
the Regional Administrator.
    (d) Except as provided in Sec. Sec.  906.16 and 906.17, NAO's 
decision takes effect 30 days after the date it is issued and, upon 
taking effect, is the final decision of the Department for the purposes 
of judicial review.


Sec.  906.16  Reconsideration.

    (a) Any party may file a motion for reconsideration of NAO's 
decision. The request must be filed with NAO within 10 calendar days 
after service of NAO's decision.
    (b) The motion must be in writing and contain a detailed statement 
of an error of fact or law material to the decision.
    (c) If an appellate officer grants the motion for reconsideration, 
then NAO will stay the effective date of its decision under 
reconsideration review.
    (d) In response to a motion for reconsideration, NAO will either:
    (1) Reject the motion because it does not meet the criteria of 
paragraph (a) or (b) of this section; or
    (2) Issue a revised decision which will take effect 30 days after 
it is issued and is the final decision of the Department for the 
purposes of judicial review, unless the Regional Administrator remands, 
reverses or modifies it pursuant to Sec.  906.17.


Sec.  906.17  Review by the Regional Administrator.

    (a) Regional Administrator authority and procedures. (1) A decision 
issued pursuant to Sec.  906.15 or revised decision issued pursuant to 
Sec.  906.16 is subject to review by the Regional Administrator. After 
10 days of the date of the decision issued by NAO, the Regional 
Administrator may remand, reverse, or modify NAO's decision. In 
reviewing NAO's findings of fact, the Regional Administrator may only 
consider the evidentiary record including arguments, claims, evidence 
of record and other documents of record which were before NAO when it 
rendered its decision.
    (2) The Regional Administrator must provide a written decision 
explaining why NAO's decision has been remanded, reversed, or modified. 
The Regional Administrator must serve a copy of the remanded, reversed 
or modified decision on NAO and the appellant promptly.
    (b) The Regional Administrator's written decision to reverse or 
modify NAO's decision is the final decision of the Department for the 
purposes of judicial review.
    (c) If the Regional Administrator does not remand, reverse, or 
modify NAO's decision under paragraphs (a) and (b) of this section, 
NAO's decision is the final decision of the Department for the purposes 
of judicial review.


Sec.  906.18  Implementation of final decisions.

    The final decision shall be implemented by the office that issued 
the initial administrative determination within 30 days after issuance 
of the final decision to the extent practicable and consistent with 
program regulations.

[FR Doc. 2012-13979 Filed 6-7-12; 8:45 am]
BILLING CODE 3510-22-P