Implementation of the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015, 41451-41452 [2016-14795]

Agencies

• NATIONAL SCIENCE FOUNDATION

[Federal Register Volume 81, Number 123 (Monday, June 27, 2016)]
[Rules and Regulations]
[Pages 41451-41452]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-14795]



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NATIONAL SCIENCE FOUNDATION

45 CFR Parts 672 and 681

RIN 3145-AA58


Implementation of the Federal Civil Penalties Inflation 
Adjustment Act Improvements Act of 2015

AGENCY: National Science Foundation.

ACTION: Interim final rule.

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SUMMARY: The National Science Foundation (NSF or Foundation) is 
adjusting the maximum civil monetary penalties that may be imposed for 
violations of the Antarctic Conservation Act of 1978 (ACA), to reflect 
the requirements of the Federal Civil Penalties Inflation Adjustment 
Act Improvements Act of 2015 (the 2015 Act). The 2015 Act further 
amended the Federal Civil Penalties Inflation Adjustment Act of 1990 
(the Inflation Adjustment Act), to improve the effectiveness of civil 
monetary penalties and to maintain their deterrent effect.

DATES: Effective August 1, 2016.

ADDRESSES: You may submit comments, identified by RIN 3145-AA58. 
Comments should be submitted by any of the following methods:
    1. Internet--Send comments via email to bgilansh@nsf.gov.
    2. Fax--(703)292-9242.

FOR FURTHER INFORMATION CONTACT: Bijan Gilanshah, Assistant General 
Counsel, Office of the General Counsel, at 703-292-8060, National 
Science Foundation, 4201 Wilson Boulevard, Room 1265, Arlington, 
Virginia 22230.

SUPPLEMENTARY INFORMATION: The 2015 Act requires agencies to: (1) 
Adjust the level of civil monetary penalties with an initial ``catch-
up'' adjustment through an interim final rulemaking; and (2) make 
subsequent annual adjustments for inflation. Inflation adjustments will 
be based on the percent change in the Consumer Price Index for all 
Urban Consumers (CPI-U) for the month of October preceding the date of 
the adjustment, relative to the October CPI-U in the year of the 
previous adjustment. The only civil monetary penalties within NSF's 
jurisdiction are those authorized by the Antarctic Conservation Act of 
1978 (ACA), 16 U.S.C. 2401, et seq., and the Program Fraud Civil 
Remedies Act of 1986 (PFCRA), 31 U.S.C. 3801, et seq.

Initial Adjustments Under the ACA and PFCRA

    For the first adjustment made in accordance with the 2015 Act, the 
amount of the adjustment is calculated based on the percent change 
between the CPI-U for October of the last year in which penalties were 
previously adjusted (not including any adjustment made pursuant to the 
Inflation Adjustment Act before November 2, 2015), and the CPI-U for 
October 2015. The 10 percent cap on adjustments imposed by the Debt 
Collection Improvement Act of 1996 has been eliminated by the 2015 Act. 
Instead, the 2015 Act imposes a cap on the amount of this initial 
adjustment, such that the amount of the increase may not exceed 150 
percent of the pre-adjustment penalty amount or range. As a result, the 
total penalty amount or range after the initial adjustment under the 
2015 Act may not exceed 250 percent of the pre-adjustment penalty 
amount or range.
    For purposes of the initial adjustment of the ACA's penalties under 
the 2015 Act, Congress last set or adjusted the amount of civil 
penalties in 1978. Between October 1978 and October 2015, the CPI-U has 
increased by 354.453 percent. The post-adjustment penalty amount or 
range is obtained by multiplying the pre-adjustment penalty amount or 
range by the percent change in the CPI-U over the relevant time period, 
and rounding to the nearest dollar. Therefore, the new, post-adjustment 
maximum penalty under the ACA for violations is $5,000 x 3.54453 = 
$17722.65, which rounds to $17723. The new, post-adjustment maximum 
penalty for knowing violations is $10,000 x 3.54453= $35,445.30, which 
rounds to $35,445. The new, post-adjustment penalties are greater than 
250 percent of the pre-adjustment penalties, so the limitation on the 
amount of the adjustment is implicated. Therefore, the maximum penalty 
under the ACA after August 1, 2016 will be $16,250 ($6500 x 2.5) for 
violations and $27,500 ($11,000 x 2.5) for knowing violations.
    For purposes of the initial adjustment under the 2015 Act, Congress 
last set or adjusted the amount of PFCRA civil penalties in 1986. 
Between October 1986 and October 2015, the CPI-U has increased by 
215.628 percent. The post-adjustment penalty amount or range is 
obtained by multiplying the pre-adjustment penalty amount or range by 
the percent change in the CPI-U over the relevant time period, and 
rounding to the nearest dollar. Therefore, the new, post-adjustment 
maximum penalty under the PFCRA is $5,000 x 2.15628 = $10,781.40, which 
rounds to $10,781. The new, post-adjustment penalties are less than 250 
percent of the pre-adjustment penalties, so the limitation on the 
amount of the adjustment is not implicated. Therefore, the maximum 
penalty under the PFCRA for claims or statements made after August 1, 
2016 will be $10,781.

Subsequent Annual Adjustments

    The 2015 Act also requires agencies to make annual adjustments to 
civil penalty amounts no later than January 15 of each year following 
the initial adjustment described above. For subsequent adjustments made 
in accordance with the 2015 Act, the amount of the adjustment is based 
on the percent increase between the CPI-U for the month of October 
preceding the date of the adjustment and the CPI-U for the October one 
year prior to the October immediately preceding the date of the 
adjustment. If there is no increase, there is no adjustment of civil 
penalties. Therefore, if NSF adjusts penalties in January 2017, the 
adjustment will be calculated based on the percent change between the 
CPI-U for October 2016 (the October immediately preceding the date of 
adjustment) and October 2015 (the October one year prior to October 
2016). NSF will publish the amount of these annual inflation 
adjustments in the Federal Register no later than January 15 of each 
year, starting in 2017.

Public Participation

    This interim final rule is being issued without prior public notice 
or opportunity for public comments. The 2015 Act's amendments to the 
Inflation Adjustment Act require the agency to adjust penalties 
initially through an interim final rulemaking, which does not require 
the agency to complete a notice and comment process prior to 
promulgating the interim final rule. The amendments also explicitly 
require the agency to make subsequent annual adjustments 
notwithstanding 5 U.S.C. 553 (the section of the Administrative 
Procedure Act that normally requires agencies to engage in notice and 
comment). Additionally, the formula used for adjusting the amount of 
civil penalties is given by statute, with no discretion provided to the 
NSF regarding the substance of the adjustments. NSF is charged only 
with performing ministerial computations to determine the amount of 
adjustment to the civil penalties due to increases in the Consumer 
Price Index for all Urban Consumers (CPI-U).

[[Page 41452]]

Environmental Impact

    This interim final rule only makes conforming changes to the 
Foundation's regulations to reflect inflationary adjustments to its 
civil monetary penalties required by the 2015 Act.

No Takings Implications

    NSF has determined that this interim final rule will not involve 
the taking of private property pursuant to E.O. 12630.

Civil Justice Reform

    NSF has considered this interim final rule under E.O. 12988 on 
civil justice reform and determined the principles underlying and 
requirements of E.O. 12988 are not implicated.

Federalism and Consultation and Coordination With Indian Tribal 
Governments

    NSF has considered this interim final rule under the requirements 
of E.O. 13132 on federalism and has determined that the interim final 
rule conforms with the federalism principles set out in this E.O.; will 
not impose any compliance costs on the States; and will not have 
substantial direct effects on the States, the relationship between the 
Federal government and the States, or the distribution of power and 
responsibilities among the various levels of government. Therefore, the 
Foundation has determined that no further assessment of federalism 
implications is necessary.
    Moreover, NSF has determined that promulgation of this interim 
final rule does not require advance consultation with Indian Tribal 
officials as set forth in E.O. 13175, Consultation and Coordination 
with Indian Tribal Governments.

Energy Effects

    NSF has reviewed this interim final rule under E.O. 13211, Actions 
Concerning Regulations That Significantly Affect Energy Supply, 
Distribution, or Use and has determined that this final rule does not 
constitute a significant energy action as defined in the E.O.

Regulatory Planning and Review

    This interim final rule has not been designated a ``significant 
regulatory action,'' under Executive Order 12866. The interim final 
rule only makes inflation adjustments to NSF's civil monetary 
penalties.

Unfunded Mandates

    Pursuant to Title II of the Unfunded Mandates Reform Act of 1995 (2 
U.S.C. 1531-1538), NSF has assessed the effects of this interim final 
rule on State, local, and Tribal governments and the private sector. 
This interim final rule will not compel the expenditure of $100 million 
or more by any State, local, or Tribal government or anyone in the 
private sector. Therefore, a statement under section 202 of the act is 
not required.

Controlling Paperwork Burdens on the Public

    This interim final rule does not contain any recordkeeping or 
reporting requirements or other information collection requirements as 
defined in 5 CFR part 1320 that are not already required by law or not 
already approved for use. Accordingly, the review provisions of the 
Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.) and its 
implementing regulations at 5 CFR part 1320 do not apply.

List of Subjects

45 CFR Part 672

    Administrative practice and procedure, Antarctica.

45 CFR Part 681

    Civil remedies; Program fraud.

    For the reasons set out in the preamble, 45 CFR parts 672 and 681 
are amended as follows:

PART 672--ENFORCEMENT AND HEARING PROCEDURES

0
1. The authority citation for part 672 continues to read as follows:

    Authority: 16 U.S.C. 2401 et seq., 28 U.S.C. 2461 note.


0
2. Revise Sec.  672.24 to read as follows:


Sec.  672.24  Maximum civil monetary penalties for violations.

    (a) For violations occurring prior to August 1, 2016, the maximum 
civil penalty is $6500 for any violation and $11,000 for knowing 
violations.
    (b) For violations occurring after August 1, 2016, but before 
January 1, 2017, the maximum civil penalty is adjusted to $16,250 for 
any violation and $27,500 for knowing violations.
    (c) For violations occurring on or after January 1, 2017, the 
maximum penalty, which may be assessed under Part 672 of the title, is 
the larger of:
    (1) The amount for the previous calendar year, or
    (2) An amount adjusted for inflation, calculated by multiplying the 
amount for the previous calendar year by the percentage by which the 
CPI-U for the month of October preceding the current calendar year 
exceeds the CPI-U for the month of October of the calendar year two 
years prior to the current calendar year, adding that amount to the 
amount for the previous calendar year, and rounding the total to the 
nearest dollar.
    (d) Notice of the maximum penalty which may be assessed under Part 
672 of this title for calendar years after 2016 will be published by 
the NSF in the Federal Register on an annual basis on or before January 
15 of each calendar year.

PART 681--PROGRAM FRAUD CIVIL REMEDIES ACT REGULATIONS

0
3. The authority citation for part 681 continues to read as follows:

     Authority: 31 U.S.C. 3801 et seq.


0
4. In Sec.  681.3, add paragraphs (f) and (g) to read as follows:


Sec.  681.3  What is the basis for the imposition of civil penalties 
and assessments?

* * * * *
    (f) For claims or statements made on or after August 1, 2016, but 
before January 1, 2017, the maximum penalty which may be assessed under 
Part 681 of the title is $10,781. For claims or statements made on or 
after January 1, 2017, the maximum penalty which may be assessed under 
Part 681 of the title is the larger of:
    (1) The amount for the previous calendar year, or
    (2) An amount adjusted for inflation, calculated by multiplying the 
amount for the previous calendar year by the percentage by which the 
CPI-U for the month of October preceding the current calendar year 
exceeds the CPI-U for the month of October of the calendar year two 
years prior to the current calendar year, adding that amount to the 
amount for the previous calendar year, and rounding the total to the 
nearest dollar.
    (g) Notice of the maximum penalty, which may be assessed under Part 
681 of this title for calendar years after 2016, will be published by 
NSF in the Federal Register on an annual basis on or before January 15 
of each calendar year.

National Science Foundation.

    Dated: June 16, 2016.
Lawrence Rudolph,
General Counsel.
[FR Doc. 2016-14795 Filed 6-24-16; 8:45 am]
 BILLING CODE 7555-01-P