Rules of Practice and Procedure; Adjusting Civil Money Penalties for Inflation, 24336-24338 [2013-09807]
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Federal Register / Vol. 78, No. 80 / Thursday, April 25, 2013 / Rules and Regulations
pursuant to the provisions of the
Agricultural Marketing Agreement Act
of 1937, as amended (7 U.S.C. 601–674)
(Act), and the applicable rules of
practice and procedure (7 CFR part 900).
Upon the basis of the evidence
introduced at such hearing and the
record thereof, it is found that:
(1) The said orders as hereby
amended, and all of the terms and
conditions thereof, will tend to
effectuate the declared policy of the Act;
(2) The parity prices of milk, as
determined pursuant to section 2 of the
Act, are not reasonable in view of the
price of feeds, available supplies of
feeds, and other economic conditions
which affect market supply and demand
for milk in the aforesaid marketing
areas. The minimum prices specified in
the orders as hereby amended are such
prices as will reflect the aforesaid
factors, insure a sufficient quantity of
pure and wholesome milk, and be in the
public interest; and
(3) The said orders, as hereby
amended, regulate the handling of milk
in the same manner as, and is applicable
only to persons in the respective classes
of industrial or commercial activity
specified in, a marketing agreement
upon which a hearing has been held.
(b) Determinations. It is hereby
determined that:
(1) The refusal or failure of handlers
(excluding cooperative associations
specified in Section 8c(9) of the Act) of
more than 50 percent of the milk, which
is marketed within the specified
marketing areas, to sign a proposed
marketing agreement, tends to prevent
the effectuation of the declared policy of
the Act;
(2) The issuance of this order
amending the Northeast and other
orders is the only practical means
pursuant to the declared policy of the
Act of advancing the interests of
producers as defined in the orders as
hereby amended;
(3) The issuance of this order
amending the Northeast and other
orders is favored by at least two-thirds
of the producers who were engaged in
the production of milk for sale in the
respective marketing areas.
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List of Subjects in 7 CFR Part 1000
Milk marketing orders.
Order Relative to Handling
It is therefore ordered, that on and
after the effective date hereof, the
handling of milk in the Northeast and
other marketing areas shall be in
conformity to and in compliance with
the terms and conditions of the orders,
as amended, and as hereby amended, as
follows:
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The provisions of the order amending
the orders contained in the interim
amendments of the orders issued by the
Administrator, Agricultural Marketing
Service, on July 25, 2008, and published
in the Federal Register on July 31, 2008,
(73 FR 44617), are adopted and shall be
the terms and provisions of these orders.
Dated: April 22, 2013.
David R. Shipman,
Administrator, Agricultural Marketing
Service.
• Adjust for inflation the maximum
amount of CMPs that the FCA has
jurisdiction to administer pursuant to
the Farm Credit Act in accordance with
the requirements of the Inflation
Adjustment Act,1 and
• Implement the provisions for the
maximum amount of CMPs provided by
the Biggert-Waters Act.2
II. Background
[FR Doc. 2013–09819 Filed 4–24–13; 8:45 am]
BILLING CODE 3410–02–P
FARM CREDIT ADMINISTRATION
12 CFR Part 622
RIN 3052–AC87
Rules of Practice and Procedure;
Adjusting Civil Money Penalties for
Inflation
Farm Credit Administration.
Final rule.
AGENCY:
ACTION:
This regulation implements
inflation adjustments to civil money
penalties (CMPs) that the Farm Credit
Administration (FCA) may impose
pursuant to the Farm Credit Act of 1971,
as amended (Farm Credit Act), and
pursuant to the Flood Disaster
Protection Act of 1973, as amended by
the National Flood Insurance Reform
Act of 1994 (Reform Act), and further
amended by the Biggert-Waters Flood
Insurance Reform Act of 2012 (BiggertWaters Act). The Federal Civil Penalties
Inflation Adjustment Act of 1990, as
amended by the Debt Collection
Improvement Act of 1996 (Inflation
Adjustment Act), requires all Federal
agencies with the authority to impose
CMPs to evaluate those CMPs
periodically to ensure that they
continue to maintain their deterrent
value and promote compliance with the
law.
DATES: This regulation is effective on
July 1, 2013.
FOR FURTHER INFORMATION CONTACT:
Michael T. Wilson, Policy Analyst,
Office of Regulatory Policy, Farm Credit
Administration, McLean, VA 22102–
5090, (703) 883–4124, TTY (703) 883–
4056, or Nancy Tunis, Senior Attorney,
Office of General Counsel, Farm Credit
Administration, McLean, VA 22102–
5090, (703) 883–4061, TTY (703) 883–
4056.
SUPPLEMENTARY INFORMATION:
SUMMARY:
I. Objective
The objectives of this regulation are
to:
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A. Federal Civil Penalties Inflation
Adjustment Act of 1990, as Amended
The Inflation Adjustment Act requires
every Federal agency with authority to
issue CMPs 3 to enact regulations that
adjust its CMPs pursuant to the inflation
adjustment formula in section 5(b) of
the Inflation Adjustment Act. Each
Federal agency was required to issue
these regulations by October 23, 1996,
and, thereafter, to evaluate and adjust
the CMPs when necessary, but at least
once every 4 years. Section 6 of the
amended Inflation Adjustment Act
specifies that inflation-adjusted CMPs
will apply only to violations that occur
after the effective date of the
adjustment. The inflation adjustment is
based on the percentage increase in the
Consumer Price Index (CPI).4
Specifically, section 5(b) of the Inflation
Adjustment Act defines the term ‘‘costof-living adjustment’’ as ‘‘the percentage
(if any) for each civil monetary penalty
by which (1) the Consumer Price Index
for the month of June of the calendar
year preceding the adjustment, exceeds
(2) the Consumer Price Index for the
month of June of the calendar year in
which the amount of such civil
monetary penalty was last set or
adjusted pursuant to law.’’ Furthermore,
the increase for each CMP adjusted for
inflation must be rounded using a
method prescribed by section 5(a) of the
Inflation Adjustment Act. FCA made its
last adjustments to CMPs in January
2009.
B. CMPs Issued Under the Farm Credit
Act
The adjustment requirement affects
two provisions of section 5.32(a) of the
1 28
U.S.C. 2461 note.
Law 112–141, 126 Stat. 405 (July 6,
2 Public
2012).
3 See 28 U.S.C. 2461 note. Section 3(2) of the
amended Inflation Adjustment Act defines a CMP
as any penalty, fine, or other sanction that: (1)
Either is for a specific monetary amount as
provided by Federal law or has a maximum amount
provided for by Federal law; and (2) is assessed or
enforced by an agency pursuant to Federal law; and
(3) is assessed or enforced pursuant to an
administrative proceeding or a civil action in the
Federal courts.
4 The CPI is published by the Department of
Labor, Bureau of Statistics, and is available at its
Web site: ftp://ftp.bls.gov/pub/special.requests/cpi/
cpiai.txt.
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Federal Register / Vol. 78, No. 80 / Thursday, April 25, 2013 / Rules and Regulations
Farm Credit Act. First, it provides that
any Farm Credit System (System)
institution or any officer, director,
employee, agent, or other person
participating in the conduct of the
affairs of a System institution who
violates the terms of a final order issued
under section 5.25 or 5.26 of the Farm
Credit Act must pay up to $1,000 5 per
day for each day during which such
violation continues. Orders issued by
the FCA under section 5.25 or 5.26 of
the Farm Credit Act include temporary
and permanent cease-and-desist orders.
In addition, section 5.32(h) provides
that any directive issued under sections
4.3(b)(2), 4.3A(e), or 4.14A(i) of the
Farm Credit Act ‘‘shall be treated’’ as a
final order issued under section 5.25 for
purposes of assessing a CMP. Second,
section 5.32(a) also states that ‘‘[a]ny
such institution or person who violates
any provision of the [Farm Credit] Act
or any regulation issued under this Act
shall forfeit and pay a civil penalty of
not more that $500 6 per day for each
day during which such violation
continues.’’ The maximum amounts of
the CMPs, as adjusted pursuant to the
Inflation Adjustment Act, are set forth
in existing § 622.61 of FCA regulations.
1. Mathematical Calculation
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In general, the adjustment calculation
required by the Inflation Adjustment
Act is based on the percentage by which
the CPI for June 2012 exceeds the CPI
for June of the calendar year the
maximum amount of the CMPs was last
adjusted.7 The maximum CMPs for
violation of the terms of a final order
issued under section 5.25 or 5.26 of the
Farm Credit Act was last adjusted in
1996.8 The maximum CMPs for a
violation of the Farm Credit Act, or a
regulation issued under the Farm Credit
Act, was last adjusted in 2009.
According to the Bureau of Labor
Statistics, the CPI for June 1996 and
June 2009 was 156.7 and 215.693,
respectively. The CPI for June 2012 was
229.478, resulting in a percentage
change of 46.44 percent from June 1996
and 6.39 percent from June 2009.
5 The current inflation-adjusted CMP for a
violation of a final order is $1,100 per day, as set
forth in § 622.61(a)(1) of FCA regulations.
6 The current inflation-adjusted CMP for a
violation of the Farm Credit Act or a regulation
issued under the Farm Credit Act is $750 per day,
as set forth in § 622.61(a)(2) of FCA regulations.
7 Public Law 101–410, Section 5(b).
8 The CMP inflation adjustment analysis was
conducted in subsequent intervals following 1996;
however, the penalty amount did not change in
those calculations. The last year the amount was
actually amended was 1996, as such, that is the year
for which we refer to the consumer price index.
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2. New Penalty Amount in § 622.61(a)(1)
The existing maximum CMPs in
§ 622.61(a) for a violation of a final
order issued under section 5.25 or 5.26
of the Farm Credit Act is $1,100.
Multiplying $1,100 by the 46.44 9
percent change in CPI from June 1996 to
June 2012 yields an increase of $510.84.
When that number is rounded as
required by section 5(a) of the Inflation
Adjustment Act,10 the inflation-adjusted
maximum increases to $2,100.
3. Penalty Amount Remains the Same in
§ 622.61(a)(2)
The existing maximum CMPs in
§ 622.61(a)(2) is $750 for a violation of
the Farm Credit Act or regulations
issued under the Farm Credit Act that
occurs on or after January 16, 2009.
Multiplying the existing CMP amount
by the 6.39 percent change in CPI from
June 2009 to June 2012 yields an
increase of $47.93. This increase is
rounded down to $0.00 as required by
section 5(a) of the Inflation Adjustment
Act 11 and, therefore, the inflationadjusted maximum remains at $750.
C. CMPs Issued Under the Reform Act
The Flood Disaster Protection Act of
1973,12 as amended by the National
Flood Insurance Reform Act of 1994,13
requires that FCA assess CMPs for a
pattern or practice of committing certain
specific actions in violation of the
National Flood Insurance Program.
Pursuant to section 100208 of the
Biggert Waters Act, which further
amends the Flood Disaster Protection
Act of 1973, FCA is amending the
maximum CMPs prescribed in 42 U.S.C.
4012a(f)(5).14 In that statute, Congress
increased the maximum CMPs per
violation of the National Flood
Insurance Program from $385 to $2,000
and eliminated the cap on the total
9 As a result of the mathematical calculation for
the year 2009 and the required rounding
application, the penalty amount remained the same
and did not reset. Therefore, in accordance with the
Inflation Adjustment Act, the calculation for the
2012 adjustment is determined by using the June
1996 CPI of 156.7 and the June 2012 CPI of 229.48,
resulting in a percentage change of 46.44 percent.
10 Per section 5(a)(3) of the Inflation Adjustment
Act, any increase determined under the subsection
shall be rounded to the nearest multiple of $1,000
in the case of penalties greater than $1,000 but less
than or equal to $10,000.
11 Per section 5(a)(2), any increase determined
under this subsection shall be rounded to the
nearest multiple of $100 in the case of penalties
greater than $100 but less than or equal to $1,000.
12 42 U.S.C. 4012a.
13 Public Law 103–325, title V, 108 Stat. 2160,
2255–87 (September 23, 1994).
14 Section 100208 Enforcement: Section 102(f)(5)
of the Flood Disaster Protection Act of 1973 (42
U.S.C. 4012a(f)(5) is amended: (1) In the first
sentence, by striking ‘‘$350’’ and inserting $2,000;
and (2) by striking the second sentence.
PO 00000
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24337
amount of penalties assessed against a
single regulated lender in any calendar
year.
1. Mathematical Calculation
As a result of the provisions of the
Biggert-Waters Act, the CMPs for
violating the National Flood Insurance
Program are not subject to an inflation
adjustment at this time.
2. New Penalty Amounts in § 622.61(b)
As required by the Biggert-Waters Act,
the maximum assessment of the CMP
for violating 42 U.S.C. 4012a(f)(5) is
$2,000 per violation, and the cap on
penalties is eliminated.
III. Notice and Comment Not Required
by Administrative Procedure Act
The Inflation Adjustment Act gives
Federal agencies no discretion in the
adjustment of CMPs for the rate of
inflation. In addition, the Biggert-Waters
Act gives Federal agencies no discretion
in the amount of CMPs for violations of
the National Flood Insurance Program.
Further, these revisions are ministerial,
technical, and noncontroversial. For
these reasons, the FCA finds good cause
to determine that public notice and an
opportunity to comment are
impracticable, unnecessary, and
contrary to the public interest pursuant
to the Administrative Procedure Act, 5
U.S.C. 553(b)(B), and adopts this rule in
final form.
IV. Regulatory Flexibility Act
Pursuant to section 605(b) of the
Regulatory Flexibility Act (5 U.S.C. 601
et seq.), the FCA hereby certifies that
this final rule will not have a significant
economic impact on a substantial
number of small entities. Each of the
banks in the System, considered
together with its affiliated associations,
has assets and annual income in excess
of the amounts that would qualify them
as small entities. Therefore, System
institutions are not ‘‘small entities’’ as
defined in the Regulatory Flexibility
Act.
List of Subjects in 12 CFR Part 622
Administrative practice and
procedure, Crime, Investigations,
Penalties.
For the reasons stated in the
preamble, part 622 of chapter VI, title 12
of the Code of Federal Regulations is
amended as follows:
PART 622—RULES OF PRACTICE AND
PROCEDURE
1. The authority citation for part 622
continues to read as follows:
■
Authority: Secs. 5.9, 5.10, 5.17, 5.25–5.37
of the Farm Credit Act (12 U.S.C. 2243, 2244,
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Federal Register / Vol. 78, No. 80 / Thursday, April 25, 2013 / Rules and Regulations
2252, 2261–2273); 28 U.S.C. 2461 note; and
42 U.S.C. 4012a(f).
■
DEPARTMENT OF TRANSPORTATION
Federal Aviation Administration
2. Revise § 622.61 to read as follows:
§ 622.61 Adjustment of civil money
penalties by the rate of inflation under the
Federal Civil Penalties Inflation Adjustment
Act of 1990, as amended.
14 CFR Part 39
(a) The maximum amount of each
civil money penalty within FCA’s
jurisdiction is adjusted in accordance
with the Federal Civil Penalties
Inflation Adjustment Act of 1990, as
amended (28 U.S.C. 2461 note), as
follows:
(1) Amount of civil money penalty
imposed under section 5.32 of the Act
for violation of a final order issued
under section 5.25 or 5.26 of the Act:
The maximum daily amount is $1,100
for violations occurring before July 1,
2013, and $2,100 for violations that
occur on or after July 1, 2013.
(2) Amount of civil money penalty for
violation of the Act or regulations: the
maximum daily amount is $650 for each
violation that occurs on or after March
16, 2005, but before January 16, 2009,
and $750 for each violation that occurs
on or after January 16, 2009.
(b) The maximum civil money penalty
amount assessed under 42 U.S.C.
4012a(f) is: $385 for each violation that
occurs on or after March 16, 2005, but
before January 16, 2009, with total
penalties under such statute not to
exceed $110,000 for any single
institution during any calendar year;
$385 for each violation that occurs on or
after January 16, 2009, but before July 1,
2013, with total penalties under such
statute not to exceed $120,000 for any
single institution during any calendar
year; and $2,000 for each violation that
occurs on or after July 1, 2013, with no
cap on the total amount of penalties that
can be assessed against any single
institution during any calendar year.
RIN 2120–AA64
Dated: April 19, 2013.
Dale Aultman,
Secretary, Farm Credit Administration Board.
[FR Doc. 2013–09807 Filed 4–24–13; 8:45 am]
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BILLING CODE 6705–01–P
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[Docket No. FAA–2012–0935; Directorate
Identifier 2011–NM–256–AD; Amendment
39–17428; AD 2013–08–11]
Airworthiness Directives; The Boeing
Company Airplanes
Federal Aviation
Administration (FAA), DOT.
ACTION: Final rule.
AGENCY:
We are adopting a new
airworthiness directive (AD) for certain
The Boeing Company Model 737–900
and –900ER series airplanes. This AD
was prompted by reports of early fatigue
cracks at chem-mill areas on the crown
skin panels. This AD requires repetitive
inspections for cracking of the fuselage
skin along chem-mill steps at certain
crown skin and shear wrinkle areas, and
repair if necessary. We are issuing this
AD to detect and correct fatigue
cracking of the skin panel at the
specified chem-mill step locations,
which could result in rapid
decompression of the airplane.
DATES: This AD is effective May 30,
2013.
The Director of the Federal Register
approved the incorporation by reference
of certain publications listed in the AD
as of May 30, 2013.
ADDRESSES: For service information
identified in this AD, contact Boeing
Commercial Airplanes, Attention: Data
& Services Management, P.O. Box 3707,
MC 2H–65, Seattle, WA 98124–2207;
telephone 206–544–5000, extension 1;
fax 206–766–5680; Internet https://
www.myboeingfleet.com. You may
review copies of the referenced service
information at the FAA, Transport
Airplane Directorate, 1601 Lind Avenue
SW., Renton, Washington. For
information on the availability of this
material at the FAA, call 425–227–1221.
Examining the AD Docket
You may examine the AD docket on
the Internet at https://
www.regulations.gov; or in person at the
Docket Management Facility between 9
a.m. and 5 p.m., Monday through
Friday, except Federal holidays. The AD
docket contains this AD, the regulatory
evaluation, any comments received, and
other information. The address for the
Docket Office (phone: 800–647–5527) is
Document Management Facility, U.S.
Department of Transportation, Docket
Operations, M–30, West Building
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SUPPLEMENTARY INFORMATION:
Discussion
SUMMARY:
PO 00000
Ground Floor, Room W12–140, 1200
New Jersey Avenue SE., Washington,
DC 20590.
FOR FURTHER INFORMATION CONTACT:
Wayne Lockett, Aerospace Engineer,
Airframe Branch, ANM–120S, FAA,
Seattle Aircraft Certification Office,
1601 Lind Avenue SW., Renton, WA
98057–3356; phone: (425) 917–6447;
fax: (425) 917–6590; email:
Wayne.Lockett@faa.gov.
We issued a notice of proposed
rulemaking (NPRM) to amend 14 CFR
part 39 to include an AD that would
apply to the specified products. That
NPRM published in the Federal
Register on September 18, 2012 (77 FR
57539). That NPRM proposed to require
repetitive inspections for cracking of the
fuselage skin along chem-mill steps at
certain crown skin and shear wrinkle
areas, and repair if necessary.
Comments
We gave the public the opportunity to
participate in developing this AD. The
following presents the comments
received on the proposal (77 FR 57539,
September 18, 2012) and the FAA’s
response to each comment.
Request to Revise Federal Aviation
Regulations Citations
Boeing stated that references to
section 129.109(c)(2) of the Federal
Aviation Regulations (14 CFR
129.109(c)(2)) are incorrect, since that
paragraph does not exist in the current
revision of the Federal Aviation
Regulations and that the correct
paragraph reference is section
129.109(b)(2). Boeing noted that this
error occurred in the second paragraph
of the ‘‘Differences Between the
Proposed AD and the Service
Information’’ section, and in Note 1 to
paragraph (l) of the proposed AD (77 FR
57539, September 18, 2012).
We agree that the specified references
are incorrect. We agree that the citation
in the proposed AD (77 FR 57539,
September 18, 2012) is inaccurate, but
since that section of the preamble does
not reappear in this AD, no
corresponding change to this AD is
necessary. We have corrected the
citation in Note 1 to paragraph (l) of this
AD.
Winglet Supplemental Type Certificate
(STC) Comment
Aviation Partners Boeing stated that
the installation of winglets per STC
ST00830SE (https://rgl.faa.gov/
Regulatory_and_Guidance_Library/
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]]>Agencies
[Federal Register Volume 78, Number 80 (Thursday, April 25, 2013)]
[Rules and Regulations]
[Pages 24336-24338]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2013-09807]
=======================================================================
-----------------------------------------------------------------------
FARM CREDIT ADMINISTRATION
12 CFR Part 622
RIN 3052-AC87
Rules of Practice and Procedure; Adjusting Civil Money Penalties
for Inflation
AGENCY: Farm Credit Administration.
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: This regulation implements inflation adjustments to civil
money penalties (CMPs) that the Farm Credit Administration (FCA) may
impose pursuant to the Farm Credit Act of 1971, as amended (Farm Credit
Act), and pursuant to the Flood Disaster Protection Act of 1973, as
amended by the National Flood Insurance Reform Act of 1994 (Reform
Act), and further amended by the Biggert-Waters Flood Insurance Reform
Act of 2012 (Biggert-Waters Act). The Federal Civil Penalties Inflation
Adjustment Act of 1990, as amended by the Debt Collection Improvement
Act of 1996 (Inflation Adjustment Act), requires all Federal agencies
with the authority to impose CMPs to evaluate those CMPs periodically
to ensure that they continue to maintain their deterrent value and
promote compliance with the law.
DATES: This regulation is effective on July 1, 2013.
FOR FURTHER INFORMATION CONTACT: Michael T. Wilson, Policy Analyst,
Office of Regulatory Policy, Farm Credit Administration, McLean, VA
22102-5090, (703) 883-4124, TTY (703) 883-4056, or Nancy Tunis, Senior
Attorney, Office of General Counsel, Farm Credit Administration,
McLean, VA 22102-5090, (703) 883-4061, TTY (703) 883-4056.
SUPPLEMENTARY INFORMATION:
I. Objective
The objectives of this regulation are to:
Adjust for inflation the maximum amount of CMPs that the
FCA has jurisdiction to administer pursuant to the Farm Credit Act in
accordance with the requirements of the Inflation Adjustment Act,\1\
and
---------------------------------------------------------------------------
\1\ 28 U.S.C. 2461 note.
---------------------------------------------------------------------------
Implement the provisions for the maximum amount of CMPs
provided by the Biggert-Waters Act.\2\
---------------------------------------------------------------------------
\2\ Public Law 112-141, 126 Stat. 405 (July 6, 2012).
---------------------------------------------------------------------------
II. Background
A. Federal Civil Penalties Inflation Adjustment Act of 1990, as Amended
The Inflation Adjustment Act requires every Federal agency with
authority to issue CMPs \3\ to enact regulations that adjust its CMPs
pursuant to the inflation adjustment formula in section 5(b) of the
Inflation Adjustment Act. Each Federal agency was required to issue
these regulations by October 23, 1996, and, thereafter, to evaluate and
adjust the CMPs when necessary, but at least once every 4 years.
Section 6 of the amended Inflation Adjustment Act specifies that
inflation-adjusted CMPs will apply only to violations that occur after
the effective date of the adjustment. The inflation adjustment is based
on the percentage increase in the Consumer Price Index (CPI).\4\
Specifically, section 5(b) of the Inflation Adjustment Act defines the
term ``cost-of-living adjustment'' as ``the percentage (if any) for
each civil monetary penalty by which (1) the Consumer Price Index for
the month of June of the calendar year preceding the adjustment,
exceeds (2) the Consumer Price Index for the month of June of the
calendar year in which the amount of such civil monetary penalty was
last set or adjusted pursuant to law.'' Furthermore, the increase for
each CMP adjusted for inflation must be rounded using a method
prescribed by section 5(a) of the Inflation Adjustment Act. FCA made
its last adjustments to CMPs in January 2009.
---------------------------------------------------------------------------
\3\ See 28 U.S.C. 2461 note. Section 3(2) of the amended
Inflation Adjustment Act defines a CMP as any penalty, fine, or
other sanction that: (1) Either is for a specific monetary amount as
provided by Federal law or has a maximum amount provided for by
Federal law; and (2) is assessed or enforced by an agency pursuant
to Federal law; and (3) is assessed or enforced pursuant to an
administrative proceeding or a civil action in the Federal courts.
\4\ The CPI is published by the Department of Labor, Bureau of
Statistics, and is available at its Web site: ftp://ftp.bls.gov/pub/special.requests/cpi/cpiai.txt.
---------------------------------------------------------------------------
B. CMPs Issued Under the Farm Credit Act
The adjustment requirement affects two provisions of section
5.32(a) of the
[[Page 24337]]
Farm Credit Act. First, it provides that any Farm Credit System
(System) institution or any officer, director, employee, agent, or
other person participating in the conduct of the affairs of a System
institution who violates the terms of a final order issued under
section 5.25 or 5.26 of the Farm Credit Act must pay up to $1,000 \5\
per day for each day during which such violation continues. Orders
issued by the FCA under section 5.25 or 5.26 of the Farm Credit Act
include temporary and permanent cease-and-desist orders. In addition,
section 5.32(h) provides that any directive issued under sections
4.3(b)(2), 4.3A(e), or 4.14A(i) of the Farm Credit Act ``shall be
treated'' as a final order issued under section 5.25 for purposes of
assessing a CMP. Second, section 5.32(a) also states that ``[a]ny such
institution or person who violates any provision of the [Farm Credit]
Act or any regulation issued under this Act shall forfeit and pay a
civil penalty of not more that $500 \6\ per day for each day during
which such violation continues.'' The maximum amounts of the CMPs, as
adjusted pursuant to the Inflation Adjustment Act, are set forth in
existing Sec. 622.61 of FCA regulations.
---------------------------------------------------------------------------
\5\ The current inflation-adjusted CMP for a violation of a
final order is $1,100 per day, as set forth in Sec. 622.61(a)(1) of
FCA regulations.
\6\ The current inflation-adjusted CMP for a violation of the
Farm Credit Act or a regulation issued under the Farm Credit Act is
$750 per day, as set forth in Sec. 622.61(a)(2) of FCA regulations.
---------------------------------------------------------------------------
1. Mathematical Calculation
In general, the adjustment calculation required by the Inflation
Adjustment Act is based on the percentage by which the CPI for June
2012 exceeds the CPI for June of the calendar year the maximum amount
of the CMPs was last adjusted.\7\ The maximum CMPs for violation of the
terms of a final order issued under section 5.25 or 5.26 of the Farm
Credit Act was last adjusted in 1996.\8\ The maximum CMPs for a
violation of the Farm Credit Act, or a regulation issued under the Farm
Credit Act, was last adjusted in 2009. According to the Bureau of Labor
Statistics, the CPI for June 1996 and June 2009 was 156.7 and 215.693,
respectively. The CPI for June 2012 was 229.478, resulting in a
percentage change of 46.44 percent from June 1996 and 6.39 percent from
June 2009.
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\7\ Public Law 101-410, Section 5(b).
\8\ The CMP inflation adjustment analysis was conducted in
subsequent intervals following 1996; however, the penalty amount did
not change in those calculations. The last year the amount was
actually amended was 1996, as such, that is the year for which we
refer to the consumer price index.
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2. New Penalty Amount in Sec. 622.61(a)(1)
The existing maximum CMPs in Sec. 622.61(a) for a violation of a
final order issued under section 5.25 or 5.26 of the Farm Credit Act is
$1,100. Multiplying $1,100 by the 46.44 \9\ percent change in CPI from
June 1996 to June 2012 yields an increase of $510.84. When that number
is rounded as required by section 5(a) of the Inflation Adjustment
Act,\10\ the inflation-adjusted maximum increases to $2,100.
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\9\ As a result of the mathematical calculation for the year
2009 and the required rounding application, the penalty amount
remained the same and did not reset. Therefore, in accordance with
the Inflation Adjustment Act, the calculation for the 2012
adjustment is determined by using the June 1996 CPI of 156.7 and the
June 2012 CPI of 229.48, resulting in a percentage change of 46.44
percent.
\10\ Per section 5(a)(3) of the Inflation Adjustment Act, any
increase determined under the subsection shall be rounded to the
nearest multiple of $1,000 in the case of penalties greater than
$1,000 but less than or equal to $10,000.
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3. Penalty Amount Remains the Same in Sec. 622.61(a)(2)
The existing maximum CMPs in Sec. 622.61(a)(2) is $750 for a
violation of the Farm Credit Act or regulations issued under the Farm
Credit Act that occurs on or after January 16, 2009. Multiplying the
existing CMP amount by the 6.39 percent change in CPI from June 2009 to
June 2012 yields an increase of $47.93. This increase is rounded down
to $0.00 as required by section 5(a) of the Inflation Adjustment Act
\11\ and, therefore, the inflation-adjusted maximum remains at $750.
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\11\ Per section 5(a)(2), any increase determined under this
subsection shall be rounded to the nearest multiple of $100 in the
case of penalties greater than $100 but less than or equal to
$1,000.
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C. CMPs Issued Under the Reform Act
The Flood Disaster Protection Act of 1973,\12\ as amended by the
National Flood Insurance Reform Act of 1994,\13\ requires that FCA
assess CMPs for a pattern or practice of committing certain specific
actions in violation of the National Flood Insurance Program. Pursuant
to section 100208 of the Biggert Waters Act, which further amends the
Flood Disaster Protection Act of 1973, FCA is amending the maximum CMPs
prescribed in 42 U.S.C. 4012a(f)(5).\14\ In that statute, Congress
increased the maximum CMPs per violation of the National Flood
Insurance Program from $385 to $2,000 and eliminated the cap on the
total amount of penalties assessed against a single regulated lender in
any calendar year.
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\12\ 42 U.S.C. 4012a.
\13\ Public Law 103-325, title V, 108 Stat. 2160, 2255-87
(September 23, 1994).
\14\ Section 100208 Enforcement: Section 102(f)(5) of the Flood
Disaster Protection Act of 1973 (42 U.S.C. 4012a(f)(5) is amended:
(1) In the first sentence, by striking ``$350'' and inserting
$2,000; and (2) by striking the second sentence.
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1. Mathematical Calculation
As a result of the provisions of the Biggert-Waters Act, the CMPs
for violating the National Flood Insurance Program are not subject to
an inflation adjustment at this time.
2. New Penalty Amounts in Sec. 622.61(b)
As required by the Biggert-Waters Act, the maximum assessment of
the CMP for violating 42 U.S.C. 4012a(f)(5) is $2,000 per violation,
and the cap on penalties is eliminated.
III. Notice and Comment Not Required by Administrative Procedure Act
The Inflation Adjustment Act gives Federal agencies no discretion
in the adjustment of CMPs for the rate of inflation. In addition, the
Biggert-Waters Act gives Federal agencies no discretion in the amount
of CMPs for violations of the National Flood Insurance Program.
Further, these revisions are ministerial, technical, and
noncontroversial. For these reasons, the FCA finds good cause to
determine that public notice and an opportunity to comment are
impracticable, unnecessary, and contrary to the public interest
pursuant to the Administrative Procedure Act, 5 U.S.C. 553(b)(B), and
adopts this rule in final form.
IV. Regulatory Flexibility Act
Pursuant to section 605(b) of the Regulatory Flexibility Act (5
U.S.C. 601 et seq.), the FCA hereby certifies that this final rule will
not have a significant economic impact on a substantial number of small
entities. Each of the banks in the System, considered together with its
affiliated associations, has assets and annual income in excess of the
amounts that would qualify them as small entities. Therefore, System
institutions are not ``small entities'' as defined in the Regulatory
Flexibility Act.
List of Subjects in 12 CFR Part 622
Administrative practice and procedure, Crime, Investigations,
Penalties.
For the reasons stated in the preamble, part 622 of chapter VI,
title 12 of the Code of Federal Regulations is amended as follows:
PART 622--RULES OF PRACTICE AND PROCEDURE
0
1. The authority citation for part 622 continues to read as follows:
Authority: Secs. 5.9, 5.10, 5.17, 5.25-5.37 of the Farm Credit
Act (12 U.S.C. 2243, 2244,
[[Page 24338]]
2252, 2261-2273); 28 U.S.C. 2461 note; and 42 U.S.C. 4012a(f).
0
2. Revise Sec. 622.61 to read as follows:
Sec. 622.61 Adjustment of civil money penalties by the rate of
inflation under the Federal Civil Penalties Inflation Adjustment Act of
1990, as amended.
(a) The maximum amount of each civil money penalty within FCA's
jurisdiction is adjusted in accordance with the Federal Civil Penalties
Inflation Adjustment Act of 1990, as amended (28 U.S.C. 2461 note), as
follows:
(1) Amount of civil money penalty imposed under section 5.32 of the
Act for violation of a final order issued under section 5.25 or 5.26 of
the Act: The maximum daily amount is $1,100 for violations occurring
before July 1, 2013, and $2,100 for violations that occur on or after
July 1, 2013.
(2) Amount of civil money penalty for violation of the Act or
regulations: the maximum daily amount is $650 for each violation that
occurs on or after March 16, 2005, but before January 16, 2009, and
$750 for each violation that occurs on or after January 16, 2009.
(b) The maximum civil money penalty amount assessed under 42 U.S.C.
4012a(f) is: $385 for each violation that occurs on or after March 16,
2005, but before January 16, 2009, with total penalties under such
statute not to exceed $110,000 for any single institution during any
calendar year; $385 for each violation that occurs on or after January
16, 2009, but before July 1, 2013, with total penalties under such
statute not to exceed $120,000 for any single institution during any
calendar year; and $2,000 for each violation that occurs on or after
July 1, 2013, with no cap on the total amount of penalties that can be
assessed against any single institution during any calendar year.
Dated: April 19, 2013.
Dale Aultman,
Secretary, Farm Credit Administration Board.
[FR Doc. 2013-09807 Filed 4-24-13; 8:45 am]
BILLING CODE 6705-01-P
