Revisions to the Civil Penalty Inflation Adjustment Tables, 43463-43469 [2016-15744]
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43463
Rules and Regulations
Federal Register
Vol. 81, No. 128
Tuesday, July 5, 2016
This section of the FEDERAL REGISTER
contains regulatory documents having general
applicability and legal effect, most of which
are keyed to and codified in the Code of
Federal Regulations, which is published under
50 titles pursuant to 44 U.S.C. 1510.
The Code of Federal Regulations is sold by
the Superintendent of Documents. Prices of
new books are listed in the first FEDERAL
REGISTER issue of each week.
DEPARTMENT OF TRANSPORTATION
Office of the Secretary
14 CFR Part 382
Federal Aviation Administration
14 CFR Parts 1, 11, 121, 125, and 135
[Docket No.: FAA–2014–0554; Amdt. Nos.
1–69; 11–60; 121–374, 125–65, 135–133]
RIN 2120–AK32
Acceptance Criteria for Portable
Oxygen Concentrators Used on Board
Aircraft; Correction
Federal Aviation
Administration (FAA) and the Office of
the Secretary (OST), Department of
Transportation (DOT).
ACTION: Final rule; correction.
AGENCY:
This document corrects a
final rule which replaces the existing
process by which the Federal Aviation
Administration (Agency or FAA)
approves portable oxygen concentrators
(POC) for use on board aircraft in air
carrier operations, commercial
operations, and certain other operations
using large aircraft. The FAA currently
assesses each POC make and model on
a case-by-case basis and if the FAA
determines that a particular POC is safe
for use on board an aircraft, the FAA
conducts rulemaking to identify the
specific POC model in an FAA
regulation. The final rule replaces the
current process and allows passengers
to use a POC on board an aircraft if the
POC satisfies certain acceptance criteria
and bears a label indicating
conformance with the acceptance
criteria. The labeling requirement only
affects POCs intended for use on board
aircraft that were not previously
approved for use on aircraft by the FAA.
Additionally, the rulemaking will
eliminate redundant operational
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SUMMARY:
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requirements and paperwork
requirements related to the physician’s
statement. As a result, the rulemaking
will reduce burdens for POC
manufacturers, passengers who use
POCs while traveling, and affected
aircraft operators. The final rule also
made conforming amendments to the
Department of Transportation’s
(Department or DOT) rule implementing
the Air Carrier Access Act (ACAA) to
require carriers to accept all POC
models that meet FAA acceptance
criteria as detailed in this rule.
DATES: This correction will become
effective on July 5, 2016.
FOR FURTHER INFORMATION CONTACT: For
technical questions concerning this
action, contact DK Deaderick, 121 Air
Carrier Operations Branch, Air
Transportation Division, Flight
Standards Service, Federal Aviation
Administration, AFS–220, 800
Independence Avenue SW.,
Washington, DC 20591; telephone (202)
267–7480; email dk.deaderick@faa.gov.
For questions regarding the
Department’s disability regulation (14
CFR part 382), contact Clereece Kroha,
Senior Attorney, Office of Aviation
Enforcement and Proceedings,
Department of Transportation, 1200
New Jersey Avenue SE., Washington,
DC 20590; telephone (202) 366–9041;
email clereece.kroha@dot.gov.
SUPPLEMENTARY INFORMATION:
Background
On May 24, 2016, the FAA published
a final rule entitled, ‘‘Acceptance
Criteria for Portable Oxygen
Concentrators Used On Board Aircraft’’
(81 FR 33098).
The final rule affects the use of POCs
on board aircraft in operations
conducted under title 14 of the Code of
Federal Regulations (14 CFR) parts 121,
125, and 135, by replacing the existing
FAA case-by-case approval process for
each make and model of POC in Special
Federal Aviation Regulation (SFAR) No.
106, with FAA acceptance criteria.
Under SFAR No. 106, each time the
FAA approves a specific model of POC
for use on board aircraft, the agency
updates the list of approved POCs in the
SFAR.
The final rule removes SFAR No. 106
and replaces it with POC acceptance
criteria and specific labeling
requirements to identify POCs that
conform to the acceptance criteria. POCs
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that conform to the final rule acceptance
criteria will be allowed on board aircraft
without additional FAA review and
rulemaking.
As with existing requirements for
FAA approval of POCs that may be used
on aircraft, the final rule acceptance
criteria and labeling requirement only
apply to POCs intended for use on board
aircraft.
However, the final rule was published
with an incorrect references to AC 120–
95B, when the new AC is actually AC
120–95A.
Correction
In FR Doc. 2016–11908, pages 33102,
33111, and 33113, in the Federal
Register of May 24, 2016, make the
following corrections:
1. On page 33102, third column,
footnote 5, first line, correct ‘‘AC 120–
95B’’ to ‘‘AC 120–95’’;
2. On page 33111, in the first column,
tenth line from the bottom, correct ‘‘AC
120–95B’’ to read as ‘‘AC 120–95A’’;
3. On page 33113, in the first column,
third line from the top in parenthesis,
correct ‘‘AC 120–95B’’ to read as ‘‘AC
120–95A’’;
4. On page 33113, in the second
column, second paragraph, thirteenth
line, correct ‘‘AC 120–95B’’ to read as
‘‘AC 120–95A’’.
Issued under authority provided by 49
U.S.C. 106(f) in Washington, DC, on June 23,
2016.
Dale A. Bouffiou,
Acting Director, Office of Rulemaking.
[FR Doc. 2016–15770 Filed 7–1–16; 8:45 am]
BILLING CODE 4910–13–P
DEPARTMENT OF TRANSPORTATION
Federal Aviation Administration
14 CFR Parts 13 and 406
[Docket No. FAA–2016–7004; Amdt. Nos.
13–38, 406–10]
RIN 2120–AK90
Revisions to the Civil Penalty Inflation
Adjustment Tables
Federal Aviation
Administration, DOT.
ACTION: Interim final rule.
AGENCY:
This interim final rule is the
catch-up inflation adjustment to civil
penalty amounts that may be imposed
SUMMARY:
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Federal Register / Vol. 81, No. 128 / Tuesday, July 5, 2016 / Rules and Regulations
for violations of Federal Aviation
Administration regulations, as required
by the Federal Civil Penalties Inflation
Adjustment Act Improvements Act of
2015.
DATES: These amendments become
effective August 5, 2016.
FOR FURTHER INFORMATION CONTACT: Cole
R. Milliard, Attorney, Office of the Chief
Counsel, Enforcement Division, AGC–
300, Federal Aviation Administration,
800 Independence Avenue SW.,
Washington, DC 20591; telephone (202)
267–3452; email Cole.Milliard@faa.gov.
SUPPLEMENTARY INFORMATION:
Authority for This Rulemaking and
Applicable Statutes
The Federal Aviation Administration
(FAA’s) authority to issue rules on
aviation safety is found in title 49 of the
United States Code. Subtitle I, Section
106, describes the authority of the FAA
Administrator. Subtitle VII, Aviation
Programs, describes in more detail the
scope of the agency’s authority. The
Secretary of Transportation’s authority
to regulate the transportation of
hazardous materials (‘‘hazmat’’) by air is
in chapter 51 of title 49; civil penalty
authority is in section 5123. The
Secretary’s authority to regulate
commercial space transportation may be
found at 51 U.S.C. subtitle V, sections
50901–50923 (chapter 509), which
provides for the Department of
Transportation (DOT), and, through
delegation, the FAA to impose civil
penalties on persons who violate
chapter 509, a regulation issued under
chapter 509, or any term or condition of
a license or permit issued or transferred
under chapter 509. 51 U.S.C. 50906(h)–
(i), 50917.
This rule implements the Federal
Civil Penalties Inflation Adjustment Act
of 1990 (FCPIAA), Public Law (Pub. L.)
101–410, as amended by the Debt
Collection Improvement Act (DCIA) of
1996, Public Law 104–134, and the
Federal Civil Penalties Inflation
Adjustment Act Improvements Act of
2015 (2015 Act), Public Law 114–74,
codified at 28 U.S.C. 2461 note.
The FCPIAA, DCIA, and the 2015 Act
require Federal agencies to adjust
minimum and maximum civil penalty
amounts for inflation to preserve their
deterrent impact. The 2015 Act
amended the formula and frequency of
inflation adjustments. It requires an
initial catch-up adjustment in the form
of an interim final rule, followed by
annual adjustments of penalty amounts.
The amount of the adjustment must be
made using a strict statutory formula
discussed in more detail below.
Background
The FCPIAA determines inflationary
adjustments by increasing civil
penalties by a cost-of-living adjustment
(COLA). Under the FCPIAA, as
amended by the 2015 Act, the COLA for
each civil penalty is normally the
percent change between the U.S.
Department of Labor’s Consumer Price
Index for all-urban consumers (CPI–U)
for the month of October of the calendar
year preceding the adjustment and the
CPI–U for the month of October of the
previous calendar year.
However, under the 2015 Act, the
FAA must first use a different ‘‘catch-up
adjustment’’ formula. To determine the
amount of the catch-up, it must use the
percent change between the CPI–U from
the October of the calendar year in
which the penalty was last set or
adjusted by statute or regulation other
than by inflation adjustments under the
FCPIAA and the CPI–U from the
October preceding the adjustment. The
increase must be rounded to the nearest
$1, and can be no greater than 150% of
the penalty levels in effect on the date
of the 2015 Act’s enactment, which was
November 2, 2015.
Method of Calculation
The 2015 Act directed the Office of
Management and Budget (OMB) to issue
guidance on implementing the inflation
adjustments required by the 2015 Act no
later than February 29, 2016.1 On
Year last set/
adjusted
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49 U.S.C. Statute
5123(a)(1) ........................................................................................................
5123(a)(2) ........................................................................................................
5123(a)(3) ........................................................................................................
5123(a)(3) ........................................................................................................
46301(a)(1) ......................................................................................................
46301(a)(1) ......................................................................................................
46301(a)(3) 4 ....................................................................................................
1 28
U.S.C. 2461 note.
Memorandum M–16–06.
2 OMB
3 It is 2.5 rather than 1.5 because the cap is
described in terms of the amount of the increase;
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2012
2012
2005
2012
2003
2003
N/A
that is, the amount added to the penalty as a catchup cannot be greater than 150% of the penalty,
rather than being limited to 150% of the penalty
itself. 28 U.S.C. 2461 note (‘‘The amount of the
increase in a civil monetary penalty . . . shall not
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February 24, 2016, the OMB released
this required guidance, which contains
complete instructions on how to
calculate the catch-up adjustment.2 An
agency calculates the catch-up
adjustment by multiplying the
maximum or minimum penalty amount
by a multiplier calculated based on the
year the penalty was last set or adjusted
by Congress or rulemaking (other than
inflation adjustments under the
FCPIAA). As examples, here are how
the adjustments for 49 U.S.C. 5123(a)(1)
(hazmat) and 51 U.S.C. 50917
(commercial space) were calculated:
(1) Find the multiplier listed in the
OMB guidance for the year the penalty
was last set or reset.
Section 5123 was last adjusted in
2012, so the multiplier is 1.02819.
Section 50917 was last set in 1984, so
the multiplier is 2.25867.
(2) Multiply the penalty amount by
the multiplier, and round to the nearest
dollar.
$75,000 * 1.02819 = $77,114
$100,000 * 2.25867 = $225,867
(3) Multiply the 2015 penalty amount
(including any prior adjustments under
the Inflation Adjustment Act) by 2.5,3
and round to the nearest dollar to find
the 150% cap for the catch-up
adjustment.
$75,000 * 2.5 = $187,500
$120,000 * 2.5 = $300,000
(4) Compare the dollar amount from
(3) to the dollar amount in (2). If (2) <
(3), (2) is below the 150% cap and is the
adjusted penalty. If (2) > (3), the 150%
cap is applied and becomes the adjusted
penalty.
$77,114 < $187,500. Therefore,
$77,114 is the adjusted penalty.
$225,867 < $300,000. Therefore,
$225,867 is the adjusted penalty.
The following chart shows the values
used in the calculations and the
rounded catch-up adjustment. All of the
penalty adjustments fell below the
150% cap on the catch-up adjustment:
Penalty when
last set/adjusted
$75,000
175,000
* 450
** 75,000
25,000
1,100
N/A
Multiplier from
OMB
1.02819
1.02819
1.19397
1.02819
1.28561
1.28561
N/A
Catch-up
adjustment
$77,114
179,933
537
77,114
32,140
1,414
N/A
exceed 150 percent of the amount of that civil
monetary penalty on the date of enactment’’). Thus,
the cap is x + 1.5x = 2.5x, where x is the penalty
amount.
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Year last set/
adjusted
49 U.S.C. Statute
46301(a)(5) ......................................................................................................
46301(b) ...........................................................................................................
46302 ...............................................................................................................
46318 ...............................................................................................................
46319 ...............................................................................................................
47531 5 .............................................................................................................
51 U.S.C. 50917 6 ............................................................................................
2003
1987
1984
2000
2003
N/A
1984
Penalty when
last set/adjusted
10,000
2,000
10,000
25,000
10,000
N/A
100,000
Multiplier from
OMB
1.28561
2.06278
2.25867
1.36689
1.28561
N/A
2.25867
43465
Catch-up
adjustment
12,856
4,126
22,587
34,172
12,856
N/A
225,867
* Minimum.
** Maximum.
Amendment to Section 406.9(a)
Provision for Reduced Catch-Up
Adjustment
The 2015 Act allows an agency to
request that a catch-up adjustment be
lower than what is calculated using the
2015 Act’s formula. This requires a
determination by the head of the
agency, following a notice of proposed
rulemaking, opportunity for comment,
and a final rule, that the catch-up
adjustment will have a negative
economic impact or has social costs that
outweigh the benefits. In addition, the
director of OMB must concur with the
agency head’s determination as the
adjustment is an economic transfer. The
Administrator of the FAA does not
believe that any of the catch-up
adjustments in this rule will have a
negative economic impact or have social
costs that outweigh their benefits.
Amendments to Subpart H of 14 CFR
Part 13
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The FAA codified the statutory
formula for inflation adjustments under
the FCPIAA and DCIA in subpart H of
14 CFR part 13. Rather than amending
the subpart to match the 2015 Act,
paragraphs (a)–(c) of § 13.305 containing
the formula are being deleted as
unnecessarily duplicative of the statute.
Section 13.303 is also being deleted
because it duplicates definitions of
terms given in the statute. Section
13.301(a) is being amended to include a
reference to the 2015 Act.
4 The penalty for 46301(a)(3) is an ‘‘increase[ ]
above the otherwise applicable maximum amount
under this section to an amount not to exceed 3
times the amount of revenues that are used in
violation of such section.’’ As it depends on the
other maximum penalties in 46301, there is no
separate calculation needed for 46301(a)(3).
5 Section 47531 explicitly states that the
applicable civil penalties are ‘‘the same . . . as a
person violating section 44701(a) or (b) or any of
sections 44702–44716 of this title.’’ Sections
46301(a)(1)(A) and (a)(5) provide the civil penalty
amounts for those violations, and no separate
calculation is needed.
6 Section 50917 was added by the Commercial
Space Launch Act, Public Law 98–575, section 19,
98 Stat. 3055, 3062 (1984), and was codified as
section 70115 of title 49 before being recodified in
title 51.
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The current version of 14 CFR
406.9(a) states the maximum civil
penalty that can be imposed under its
authority ‘‘as adjusted for inflation.’’
This clause is being deleted as
redundant and unnecessary. The
maximum penalty amount as amended
by this rule will already be adjusted for
inflation, as will the future annual
adjustments required by the 2015 Act.
Retaining this clause could also create a
false impression that the penalty
amount is adjusted for inflation other
than by the 2015 Act. Therefore, the ‘‘as
adjusted for inflation’’ clause is being
removed.
Good Cause for Not Having Notice and
Comment
Under the Administrative Procedure
Act, 5 U.S.C. 553(b)(B), a final rule may
be issued without public notice and
comment if the agency finds good cause
that notice and comment are
impracticable, unnecessary, or contrary
to public interest. Good cause exists in
this case to dispense with public notice
and comment because adjustments to
civil penalties for inflation are required
by Congress, as set forth in Section 5 of
the FCPIAA, as amended, in order to
maintain the deterrent effect of civil
penalties and promote compliance with
the law. As the Administrator of the
FAA has determined that none of the
catch-up adjustments should be lowered
due to negative economic impact or
social costs that outweigh benefits, there
is no place where the FAA might apply
discretion or policy judgments in
calculating the adjustments. The
formula for determining the adjustments
is laid out by statute and cannot be
amended by the FAA, even in response
to public comment. Accordingly, public
comment is unnecessary in this case.
Regulatory Evaluation
Changes to Federal regulations must
undergo several economic analyses.
First, Executive Order 12866 and
Executive Order 13563 direct that each
Federal agency shall propose or adopt a
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regulation only upon a reasoned
determination that the benefits of the
intended regulation justify its costs.
Second, the Regulatory Flexibility Act
of 1980 (Pub. L. 96–354) requires
agencies to analyze the economic
impact of regulatory changes on small
entities. Third, the Trade Agreements
Act (Pub. L. 96–39) prohibits agencies
from setting standards that create
unnecessary obstacles to the foreign
commerce of the United States. In
developing U.S. standards, the Trade
Act requires agencies to consider
international standards and, where
appropriate, that they be the basis of
U.S. standards. Fourth, the Unfunded
Mandates Reform Act of 1995 (Pub. L.
104–4) requires agencies to prepare a
written assessment of the costs, benefits,
and other effects of proposed or final
rules that include a Federal mandate
likely to result in the expenditure by
State, local, or tribal governments, in the
aggregate, or by the private sector, of
$100 million or more annually (adjusted
for inflation with base year of 1995).
This portion of the preamble
summarizes the FAA’s analysis of the
economic impacts of this final rule.
Department of Transportation Order
DOT 2100.5 prescribes policies and
procedures for simplification, analysis,
and review of regulations. If the
expected cost impact is so minimal that
a proposed or final rule does not
warrant a full evaluation, this order
permits that a statement to that effect
and the basis for it to be included in the
preamble if a full regulatory evaluation
of the cost and benefits is not prepared.
Such a determination has been made for
this final rule. The reasoning for this
determination follows.
This rule adjusts for inflation to civil
penalties for violations of aviation
safety, hazmat, and commercial space
provisions in accord with the Federal
Civil Penalties Inflation Adjustment Act
Improvement Act (the 2015 Act), Public
Law 114–74, Section 701 (November 2,
2015). The Director of OMB provided
guidance to agencies in a February 24,
2016 memorandum on how to calculate
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the initial adjustment required by the
2015 Act. The FAA must follow the
direction of Congress and is using
statutorily-mandated guidance provided
by OMB in calculating the catch-up
inflation adjustment. Applying
Congress’s directions and OMB’s
guidance, the FAA has determined that
this rule imposes no additional social
cost. Civil penalties are, like taxes, an
economic transfer. OMB guidance A–4
states that transfers are monetary
payments from one group to another
and thus not a social cost. OMB further
dictates that transfers should not be
included in estimates of the benefits and
costs due to regulation. As transfers do
not add social cost, this is a minimal
cost rule. OMB also directs that
distributional effects of transfers should
be considered. The term ‘‘distributional
effect’’ refers to the impact of a
regulatory action across the population
and economy, divided up in various
ways (e.g. income groups, race, sex,
industrial sector, geography).
Distributional effects may arise through
transfer payments like civil penalties
that stem from regulatory enforcement
action. While persons paying civil
penalties may experience distributional
effects, these discrete effects are far
outweighed by the positive effects of
civil penalties. Compliance with FAA
statutes and regulations is essential to
safety. Civil penalties are a punishment
for those who violate FAA statutes and
regulations. They also deter future
violations. As a result, they support the
FAA’s mission of aviation, hazmat, and
commercial space safety, which benefits
the public at large. Thus, the cost
impact of this rulemaking is minimal,
and a full regulatory evaluation is not
required in accordance with DOT Order
2100.5.
The FAA has determined that this
final rule is not a ‘‘significant regulatory
action’’ as defined in section 3(f) of
Executive Order 12866 because it does
not have an annual effect on the
economy of $100 million or more or
adversely affect in a material way the
economy, a sector of the economy,
productivity, competition, jobs, the
environment, public health or safety, or
State, local, or tribal governments or
communities for the following reasons:
(i) Based on the FAA’s review of civil
penalties assessed in fiscal year 2015,
the total amount assessed was about $18
million. Even if this total itself were
increased to the catch-up adjustment
cap of a 150% increase (which is not
being done here), it would only result in
an increase of $27 million, bringing the
total amount assessed to $45 million,
which is substantially less than $100
million. Thus, the amount of the
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statutorily mandated inflation
adjustment in this rulemaking will not
have an annual effect on the economy
of $100 million or more; and
(ii) The process of determining
whether or not a civil penalty is
imposed is not affected by this change
as this rulemaking only impacts the
minimum and maximum possible
amount of the penalty.
The FAA has further determined that
this final rule is not a ‘‘significant
regulatory action’’ because it does not
(a) create a serious inconsistency or
otherwise interfere with an action taken
or planned by another agency, (b)
materially alter the budgetary impact of
entitlements, grants, user fees, or loan
programs or the rights and obligations of
recipients thereof; or (c) raise novel
legal or policy issues arising out of legal
mandates, the President’s priorities, or
the principles set forth in Executive
Order 12866. Finally, the FAA has
determined that this final rule is not
‘‘significant’’ as defined in DOT’s
Regulatory Policies and Procedures.
Regulatory Flexibility Determination
The Regulatory Flexibility Act of 1980
(Pub. L. 96–354) (RFA) establishes ‘‘as a
principle of regulatory issuance that
agencies shall endeavor, consistent with
the objectives of the rule and of
applicable statutes, to fit regulatory and
informational requirements to the scale
of the businesses, organizations, and
governmental jurisdictions subject to
regulation.’’ To achieve this principle,
agencies are required to solicit and
consider flexible regulatory proposals
and to explain the rationale for their
actions to assure that such proposals are
given serious consideration.’’ The RFA
covers a wide-range of small entities,
including small businesses, not-forprofit organizations, and small
governmental jurisdictions.
Agencies must perform a review to
determine whether a rule will have a
significant economic impact on a
substantial number of small entities. If
the agency determines that it will, the
agency must prepare a regulatory
flexibility analysis as described in the
RFA.
However, if an agency determines that
a rule is not expected to have a
significant economic impact on a
substantial number of small entities,
section 605(b) of the RFA provides that
the head of the agency may so certify
and a regulatory flexibility analysis is
not required. The certification must
include a statement providing the
factual basis for this determination, and
the reasoning should be clear.
The FAA believes that this final rule
does not have a significant economic
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impact on a substantial number of small
entities for the following reasons. While
this final rule is likely to impact a
substantial number of small entities, it
will impose only minimal costs. This
final rule simply identifies the amount
of the inflation adjustment to existing
civil monetary penalty maximums and
minimums for violations of the statutory
and regulatory provisions the FAA
enforces. The penalty amounts are those
specified by statute or called for under
the inflation adjustment statutes, and
the information in this rule is required
by the Debt Collection Improvement Act
of 1996.7 As civil penalties are
economic transfers, by OMB direction
these are not included in the calculation
of social costs.
In addition, FAA has determined the
RFA does not apply to this rulemaking.
The 2015 Act requires FAA to publish
an interim final rule and there is good
cause for issuing this rule without
notice and comment under 5 U.S.C.
553(b)(B). The Small Business
Administration’s A Guide for
Government Agencies: How to Comply
with the Regulatory Flexibility Act
(2003), provides that:
If, under the APA or any rule of general
applicability governing federal grants to state
and local governments, the agency is
required to publish a general notice of
proposed rulemaking (NPRM), the RFA must
be considered [citing 5 U.S.C. 604(a)]. . . . If
an NPRM is not required, the RFA does not
apply.
Because there is good cause for issuing
this final rule without notice and
comment (i.e., without an NPRM), the
RFA does not apply. Therefore, as
provided in section 605(b), the head of
the FAA certifies that this rule will not
result in a significant economic impact
on a substantial number of small
entities.
International Trade Impact Assessment
The Trade Agreements Act of 1979
(Pub. L. 96–39), as amended by the
Uruguay Round Agreements Act (Pub.
L. 103–465), prohibits Federal agencies
from establishing standards or engaging
in related activities that create
unnecessary obstacles to the foreign
commerce of the United States.
Pursuant to these Acts, the
establishment of standards is not
considered an unnecessary obstacle to
the foreign commerce of the United
States, so long as the standard has a
legitimate domestic objective, such as
7 The 2015 Act, Public Law 114–74, codified at
28 U.S.C. 2461 note, specifies the method of
calculating the inflation adjustment, and OMB
Memorandum M–16–06 provides the guidance
required by the 2015 Act for agencies in calculating
the inflation adjustment.
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the protection of safety, and does not
operate in a manner that excludes
imports that meet this objective. The
statute also requires consideration of
international standards and, where
appropriate, that they be the basis for
U.S. standards.
The FAA has assessed the potential
effect of this final rule and determined
that it would impose identical inflation
adjusted civil penalties on domestic and
international entities that violate
aviation safety, hazmat, and commercial
space provisions in titles 49 and 51 of
the U.S. Code and regulations issued
under those provisions, and thus would
have a neutral trade impact.
Furthermore, the inflation adjustment is
a legitimate domestic objective
preserving the existing deterrent impact
of aviation, hazmat, and commercial
space safety statutes and regulations.
Therefore, we have determined that this
rule will result in a neutral impact on
international trade.
Unfunded Mandates Assessment
Title II of the Unfunded Mandates
Reform Act of 1995 (Pub. L. 104–4)
requires each Federal agency to prepare
a written statement assessing the effects
of any Federal mandate in a proposed or
final agency rule that may result in an
expenditure of $100 million or more (in
1995 dollars) in any one year by State,
local, and tribal governments, in the
aggregate, or by the private sector; such
a mandate is deemed to be a ‘‘significant
regulatory action.’’ The FAA currently
uses an inflation-adjusted value of $155
million in lieu of $100 million. This
final rule does not contain such a
mandate; therefore, the requirements of
Title II of the Act do not apply.
Paperwork Reduction Act
The Paperwork Reduction Act of 1995
(44 U.S.C. 3507(d)) requires that the
FAA consider the impact of paperwork
and other information collection
burdens imposed on the public. The
FAA has determined that there are no
current or new requirements for
information collection associated with
this rule.
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International Compatibility
In keeping with U.S. obligations
under the Convention on International
Civil Aviation, it is FAA policy to
conform to International Civil Aviation
Organization (ICAO) Standards and
Recommended Practices to the
maximum extent practicable. The FAA
has determined that there are no ICAO
Standards and Recommended Practices
that correspond to these regulations.
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Environmental Analysis
FAA Order 1050.1F identifies FAA
actions that are categorically excluded
from preparation of an environmental
assessment or environmental impact
statement under the National
Environmental Policy Act in the
absence of extraordinary circumstances.
The FAA has determined that this
action qualifies for categorical exclusion
under the National Environmental
Policy Act in accordance with FAA
Order 1050.1F, ‘‘Environmental
Impacts: Policies and Procedures,’’
paragraph 5–6.6.f, which covers
regulations not expected to cause any
potentially significant environmental
impacts. The FAA has also determined
that there are no extraordinary
circumstances requiring an
environmental assessment or
environmental impact statement.
Federalism
The FAA has analyzed this final rule
under the principles and criteria of
Executive Order 13132, Federalism. The
agency determined that this action will
not have a substantial direct effect on
the States, or the relationship between
the Federal Government and the States,
or on the distribution of power and
responsibilities among the various
levels of government, and, therefore,
does not have federalism implications.
Regulations That Significantly Affect
Energy Supply, Distribution, or Use
The FAA has analyzed this final rule
under Executive Order 13211, Actions
Concerning Regulations that
Significantly Affect Energy Supply,
Distribution, or Use (May 18, 2001). The
agency has determined that it is not a
‘‘significant energy action’’ under the
executive order and it is not likely to
have a significant adverse effect on the
supply, distribution, or use of energy.
Availability of Rulemaking Documents
You can get an electronic copy of
rulemaking documents using the
Internet by—
1. Searching the Federal eRulemaking
Portal (https://www.regulations.gov);
2. Visiting the FAA’s Regulations and
Policies Web page at https://
www.faa.gov/regulations_policies; or
3. Accessing the Government Printing
Office’s Web page at https://
www.gpo.gov/fdsys.
You can also get a copy by sending a
request to the Federal Aviation
Administration, Office of Rulemaking,
ARM–1, 800 Independence Avenue
SW., Washington, DC 20591, or by
calling (202) 267–9680. Make sure to
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43467
identify the amendment number or
docket number of this rulemaking.
List of Subjects
14 CFR Part 13
Administrative practice and
procedure, Air transportation,
Hazardous materials transportation,
Investigations, Law enforcement,
Penalties.
14 CFR Part 406
Administrative procedure and review,
Commercial space transportation,
Enforcement, Investigations, Penalties,
Rules of adjudication.
The Amendment
In consideration of the foregoing, the
Federal Aviation Administration
amends chapters I and III of title 14,
Code of Federal Regulations as follows:
CHAPTER I—FEDERAL AVIATION
ADMINISTRATION, DEPARTMENT OF
TRANSPORTATION
PART 13—INVESTIGATIVE AND
ENFORCEMENT PROCEDURES
1. The authority citation for part 13
continues to read as follows:
■
Authority: 18 U.S.C. 6002; 28 U.S.C. 2461
(note); 49 U.S.C. 106(g), 5121–5128, 40113–
40114, 44103–44106, 44701–44703, 44709–
44710, 44713, 46101–46111, 46301, 46302
(for a violation of 49 U.S.C. 46504), 46304–
46316, 46318, 46501–46502, 46504–46507,
47106, 47107, 47111, 47122, 47306, 47531–
47532; 49 CFR 1.47.
2. Amend § 13.301 by revising
paragraph (a) and adding paragraph (c)
to read as follows:
■
§ 13.301
Scope and purpose.
(a) This subpart sets out the current
adjusted maximum civil monetary
penalties or range of minimum and
maximum civil monetary penalties for
each statutory civil penalty subject to
the FAA’s jurisdiction under title 49 of
the U.S. Code. These penalties have
been adjusted for inflation in conformity
with the Federal Civil Penalties
Inflation Adjustment Act of 1990, 28
U.S.C. 2461 (note), as amended by the
Debt Collection Improvement Act of
1996, Public Law 104–134, April 26,
1996, and the Federal Civil Penalties
Inflation Adjustment Act Improvements
Act of 2015, Public Law 114–74,
November 2, 2015, in order to maintain
the deterrent effect of civil monetary
penalties and to promote compliance
with the law.
*
*
*
*
*
(c) Minimum and maximum civil
monetary penalties within the
jurisdiction of the FAA are as follows:
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Federal Register / Vol. 81, No. 128 / Tuesday, July 5, 2016 / Rules and Regulations
TABLE OF MINIMUM AND MAXIMUM CIVIL MONETARY PENALTY AMOUNTS FOR CERTAIN VIOLATIONS OCCURRING ON OR
AFTER AUGUST 1, 2016
United States Code
citation
49 U.S.C. 5123(a),
subparagraph (1).
49 U.S.C. 5123(a),
subparagraph (2).
49 U.S.C. 5123(a),
subparagraph (3).
49 U.S.C.
46301(a)(1).
49 U.S.C.
46301(a)(1).
49 U.S.C.
46301(a)(3).
49 U.S.C.
46301(a)(5)(A).
49 U.S.C.
46301(a)(5)(B)(i).
49 U.S.C.
46301(a)(5)(B)(ii).
49 U.S.C.
46301(a)(5)(B)(iii).
49 U.S.C.
46301(a)(5)(B)(iv).
49 U.S.C. 46301(b) ..
49 U.S.C. 46302 ......
49 U.S.C. 46318 ......
49 U.S.C. 46319 ......
49 U.S.C. 47531 ......
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Violation of hazardous materials transportation law.
Violation of hazardous materials transportation law resulting in death, serious illness, severe injury, or substantial property destruction.
Violation of hazardous materials transportation law relating to training.
Deleted 7/6/
2012.
Deleted 7/6/
2012.
New or
adjusted
minimum
penalty
amount
N/A
N/A
Maximum penalty amount
when last set or
adjusted by Congress
New or
adjusted
maximum
penalty
amount
$75,000 per violation, adjusted
7/6/2012.
$175,000 per violation, adjusted 7/6/2012.
$77,114.
$75,000 per violation, adjusted
7/6/2012.
$77,114.
$179,933.
$450 per violation, set
8/10/2005.
N/A ..............
$537
N/A
$25,000 per violation, set 12/
12/2003.
$32,140.
N/A ..............
N/A
$1,100 per violation, adjusted
12/12/2003.
$1,414.
N/A ..............
N/A
$1,100 per violation, adjusted
12/12/2003.
$1,414.
N/A ..............
N/A
No change.
Violation by an individual or small business concern (except an airman serving as an airman) under 49 U.S.C.
46301(a)(5)(A)(i) or (ii).
Violation by an individual or small business concern related to the transportation of hazardous materials.
Violation by an individual or small business concern related to the registration
or recordation under 49 U.S.C. chapter
441, of an aircraft not used to provide
air transportation.
Violation by an individual or small business concern of 49 U.S.C. 44718(d),
relating to limitation on construction or
establishment of landfills.
Violation by an individual or small business concern of 49 U.S.C. 44725, relating to the safe disposal of life-limited
aircraft parts.
Tampering with a smoke alarm device ....
N/A ..............
N/A
Increase above otherwise applicable maximum amount
not to exceed 3 times the
amount of revenues that are
used in violation of such
section.
$10,000 per violation, set 12/
12/2003.
N/A ..............
N/A
$10,000 per violation, set 12/
12/2003.
$12,856.
N/A ..............
N/A
$10,000 per violation, set 12/
12/2003.
$12,856.
N/A ..............
N/A
$10,000 per violation, set 12/
12/2003.
$12,856.
N/A ..............
N/A
$10,000 per violation, set 12/
12/2003.
$12,856.
N/A ..............
N/A
$4,126.
Knowingly providing false information
about alleged violation involving the
special aircraft jurisdiction of the
United States.
Interference with cabin or flight crew ......
Permanent closure of an airport without
providing sufficient notice.
Violation of 49 U.S.C. 47528–47530, relating to the prohibition of operating
certain aircraft not complying with
stage 3 noise levels.
N/A ..............
N/A
$2,000 per violation, set 12/22/
1987.
$10,000 per violation, set 10/
12/1984.
N/A ..............
N/A ..............
N/A
N/A
$34,172.
$12,856.
N/A ..............
N/A
$25,000, set 4/5/2000 .............
$10,000 per day, set 12/12/
2003.
See 49 U.S.C. 46301(a)(1)(A)
and (a)(5), above.
Violation by a person other than an individual or small business concern under
49 U.S.C. 46301(a)(1)(A) or (B).
Violation by an airman serving as an airman under 49 U.S.C. 46301(a)(1)(A)
or
(B)
(but
not
covered
by
46301(a)(5)(A) or (B).
Violation by an individual or small business concern under 49 U.S.C.
46301(a)(1)(A) or (B) (but not covered
in 49 U.S.C. 46301(a)(5)).
Violation of 49 U.S.C. 47107(b) (or any
assurance made under such section)
or 49 U.S.C. 47133.
49 U.S.C.
46301(a)(1).
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$12,856.
$22,587.
No change.
Federal Register / Vol. 81, No. 128 / Tuesday, July 5, 2016 / Rules and Regulations
§§ 13.303 and 13.305
[Removed]
Authority: 51 U.S.C. 50901–50923.
■
equivalent to that established by the
existing airworthiness standards.
DATES: These special conditions are
effective July 5, 2016 and are applicable
on June 23, 2016.
FOR FURTHER INFORMATION CONTACT:
Ruth Hirt, Federal Aviation
Administration, Small Airplane
Directorate, Aircraft Certification
Service, Programs and Procedures
Branch, ACE–114, 901 Locust, Room
301, Kansas City, MO 64106; telephone
(816) 329–4108, facsimile (816) 329–
4090.
5. Revise § 406.9(a) to read as follows:
SUPPLEMENTARY INFORMATION:
3. Remove §§ 13.303 and 13.305.
CHAPTER III—COMMERCIAL SPACE
TRANSPORTATION, FEDERAL AVIATION
ADMINISTRATION, DEPARTMENT OF
TRANSPORTATION
PART 406—INVESTIGATIONS,
ENFORCEMENT, AND
ADMINISTRATIVE REVIEW
4. The authority citation for part 406
continues to read as follows:
■
■
§ 406.9
Background
Civil penalties.
(a) Civil penalty liability. Under 51
U.S.C. 50917(c), a person found by the
FAA to have violated a requirement of
the Act, a regulation issued under the
Act, or any term or condition of a
license or permit issued or transferred
under the Act, is liable to the United
States for a civil penalty of not more
than $225,867 for each violation. A
separate violation occurs for each day
the violation continues.
*
*
*
*
*
Issued under authority provided by 28
U.S.C. 2461 and 49 U.S.C. 106(f), 44701(a),
and 46301 in Washington, DC, on June 23,
2016.
Michael P. Huerta,
Administrator.
[FR Doc. 2016–15744 Filed 7–1–16; 8:45 am]
BILLING CODE 4910–13–P
DEPARTMENT OF TRANSPORTATION
Federal Aviation Administration
14 CFR Part 23
[Docket No. FAA–2015–5034; Special
Conditions No. 23–273–SC]
Special Conditions: Kestrel Aircraft
Company, Model K–350 Turboprop,
Lithium Batteries
Federal Aviation
Administration (FAA), DOT.
ACTION: Final special conditions.
AGENCY:
These special conditions are
issued for the Kestrel Aircraft Company,
Model K–350 Turboprop airplane. This
airplane will have a novel or unusual
design feature associated with the
installation of a rechargeable lithium
battery. The applicable airworthiness
regulations do not contain adequate or
appropriate safety standards for this
design feature. These special conditions
contain the additional safety standards
that the Administrator considers
necessary to establish a level of safety
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SUMMARY:
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On November 22, 2011, Kestrel
Aircraft Company applied for a type
certificate for their new Model K–350.
The Kestrel Aircraft Company Model K–
350 is a single-engine turboprop
airplane with the primary structure
constructed largely of carbon and epoxy
composite material. The turboprop
engine will be a Honeywell Model
TPE331–14GR–801KT that is integrated
with a Hartzell 4 bladed, 110-inch
carbon composite propeller. The
standard seating configuration offers a
one plus five cabin (one pilot and five
passengers). Alternate interior
configurations will be available from
two seats (cargo configuration) up to
eight seats total. The K–350 will
incorporate an integrated avionics
system, retractable landing gear, and a
conventional tail configuration.
Specifications expected for the K–350
include the following:
• Maximum altitude: 31,000 Feet
• Maximum cruise speed: 320 Knots
True Air Speed
• Maximum takeoff weight: 8,900
Pounds
• Maximum economy cruise: 1,200
Nautical Miles
The K–350 will be certified for singlepilot operations under part 91 and part
135 operating rules. The following
operating conditions will be included:
• Day and Night Visual Flight Rules
• Instrument Flight Rules
• Flight Into Known Icing (Phase B
certification)
Kestrel Aircraft Company plans to
utilize a rechargeable lithium main
battery on their new Model K–350
turboprop airplane. The current
regulatory requirements for part 23
airplanes do not contain adequate
requirements for the application of
rechargeable lithium batteries in
airborne applications. This type of
battery possesses certain failure and
operational characteristics with
maintenance requirements that differ
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43469
significantly from that of the nickelcadmium (Ni-Cd) and lead-acid
rechargeable batteries currently
approved in other normal, utility,
acrobatic, and commuter category
airplanes. Therefore, the FAA is issuing
this special condition to require that (1)
all characteristics of the rechargeable
lithium batteries and their installation
that could affect safe operation of the K–
350 are addressed, and (2) appropriate
Instructions for Continued
Airworthiness that include maintenance
requirements are established to ensure
the availability of electrical power from
the batteries when needed.
Type Certification Basis
Under the provisions of 14 CFR 21.17,
Kestrel Aircraft Company must show
that the K–350 meets the applicable
provisions of part 23, as amended by
amendments 23–1 through 23–62
thereto.
If the Administrator finds that the
applicable airworthiness regulations
(i.e., 14 CFR part 23) do not contain
adequate or appropriate safety standards
for the K–350 because of a novel or
unusual design feature, special
conditions are prescribed under the
provisions of § 21.16.
Special conditions are initially
applicable to the model for which they
are issued. Should the type certificate
for that model be amended later to
include any other model that
incorporates the same or similar novel
or unusual design feature, the special
conditions would also apply to the other
model under § 21.101.
In addition to the applicable
airworthiness regulations and special
conditions, the K–350 must comply
with the fuel vent and exhaust emission
requirements of 14 CFR part 34 and the
noise certification requirements of 14
CFR part 36, and the FAA must issue a
finding of regulatory adequacy under
§ 611 of Public Law 92–574, the Noise
Control Act of 1972.
The FAA issues special conditions, as
defined in 14 CFR 11.19, in accordance
with § 11.38, and they become part of
the type-certification basis under
§ 21.17(a)(2).
Novel or Unusual Design Features
The K–350 will incorporate the
following novel or unusual design
feature:
Installation of a rechargeable lithium
battery as the main or engine start
aircraft battery.
Discussion
The current regulatory requirements
for part 23 airplanes do not contain
adequate requirements for the
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]]>Agencies
[Federal Register Volume 81, Number 128 (Tuesday, July 5, 2016)]
[Rules and Regulations]
[Pages 43463-43469]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-15744]
-----------------------------------------------------------------------
DEPARTMENT OF TRANSPORTATION
Federal Aviation Administration
14 CFR Parts 13 and 406
[Docket No. FAA-2016-7004; Amdt. Nos. 13-38, 406-10]
RIN 2120-AK90
Revisions to the Civil Penalty Inflation Adjustment Tables
AGENCY: Federal Aviation Administration, DOT.
ACTION: Interim final rule.
-----------------------------------------------------------------------
SUMMARY: This interim final rule is the catch-up inflation adjustment
to civil penalty amounts that may be imposed
[[Page 43464]]
for violations of Federal Aviation Administration regulations, as
required by the Federal Civil Penalties Inflation Adjustment Act
Improvements Act of 2015.
DATES: These amendments become effective August 5, 2016.
FOR FURTHER INFORMATION CONTACT: Cole R. Milliard, Attorney, Office of
the Chief Counsel, Enforcement Division, AGC-300, Federal Aviation
Administration, 800 Independence Avenue SW., Washington, DC 20591;
telephone (202) 267-3452; email Cole.Milliard@faa.gov.
SUPPLEMENTARY INFORMATION:
Authority for This Rulemaking and Applicable Statutes
The Federal Aviation Administration (FAA's) authority to issue
rules on aviation safety is found in title 49 of the United States
Code. Subtitle I, Section 106, describes the authority of the FAA
Administrator. Subtitle VII, Aviation Programs, describes in more
detail the scope of the agency's authority. The Secretary of
Transportation's authority to regulate the transportation of hazardous
materials (``hazmat'') by air is in chapter 51 of title 49; civil
penalty authority is in section 5123. The Secretary's authority to
regulate commercial space transportation may be found at 51 U.S.C.
subtitle V, sections 50901-50923 (chapter 509), which provides for the
Department of Transportation (DOT), and, through delegation, the FAA to
impose civil penalties on persons who violate chapter 509, a regulation
issued under chapter 509, or any term or condition of a license or
permit issued or transferred under chapter 509. 51 U.S.C. 50906(h)-(i),
50917.
This rule implements the Federal Civil Penalties Inflation
Adjustment Act of 1990 (FCPIAA), Public Law (Pub. L.) 101-410, as
amended by the Debt Collection Improvement Act (DCIA) of 1996, Public
Law 104-134, and the Federal Civil Penalties Inflation Adjustment Act
Improvements Act of 2015 (2015 Act), Public Law 114-74, codified at 28
U.S.C. 2461 note.
The FCPIAA, DCIA, and the 2015 Act require Federal agencies to
adjust minimum and maximum civil penalty amounts for inflation to
preserve their deterrent impact. The 2015 Act amended the formula and
frequency of inflation adjustments. It requires an initial catch-up
adjustment in the form of an interim final rule, followed by annual
adjustments of penalty amounts. The amount of the adjustment must be
made using a strict statutory formula discussed in more detail below.
Background
The FCPIAA determines inflationary adjustments by increasing civil
penalties by a cost-of-living adjustment (COLA). Under the FCPIAA, as
amended by the 2015 Act, the COLA for each civil penalty is normally
the percent change between the U.S. Department of Labor's Consumer
Price Index for all-urban consumers (CPI-U) for the month of October of
the calendar year preceding the adjustment and the CPI-U for the month
of October of the previous calendar year.
However, under the 2015 Act, the FAA must first use a different
``catch-up adjustment'' formula. To determine the amount of the catch-
up, it must use the percent change between the CPI-U from the October
of the calendar year in which the penalty was last set or adjusted by
statute or regulation other than by inflation adjustments under the
FCPIAA and the CPI-U from the October preceding the adjustment. The
increase must be rounded to the nearest $1, and can be no greater than
150% of the penalty levels in effect on the date of the 2015 Act's
enactment, which was November 2, 2015.
Method of Calculation
The 2015 Act directed the Office of Management and Budget (OMB) to
issue guidance on implementing the inflation adjustments required by
the 2015 Act no later than February 29, 2016.\1\ On February 24, 2016,
the OMB released this required guidance, which contains complete
instructions on how to calculate the catch-up adjustment.\2\ An agency
calculates the catch-up adjustment by multiplying the maximum or
minimum penalty amount by a multiplier calculated based on the year the
penalty was last set or adjusted by Congress or rulemaking (other than
inflation adjustments under the FCPIAA). As examples, here are how the
adjustments for 49 U.S.C. 5123(a)(1) (hazmat) and 51 U.S.C. 50917
(commercial space) were calculated:
---------------------------------------------------------------------------
\1\ 28 U.S.C. 2461 note.
\2\ OMB Memorandum M-16-06.
---------------------------------------------------------------------------
(1) Find the multiplier listed in the OMB guidance for the year the
penalty was last set or reset.
Section 5123 was last adjusted in 2012, so the multiplier is
1.02819.
Section 50917 was last set in 1984, so the multiplier is 2.25867.
(2) Multiply the penalty amount by the multiplier, and round to the
nearest dollar.
$75,000 * 1.02819 = $77,114
$100,000 * 2.25867 = $225,867
(3) Multiply the 2015 penalty amount (including any prior
adjustments under the Inflation Adjustment Act) by 2.5,\3\ and round to
the nearest dollar to find the 150% cap for the catch-up adjustment.
$75,000 * 2.5 = $187,500
$120,000 * 2.5 = $300,000
\3\ It is 2.5 rather than 1.5 because the cap is described in
terms of the amount of the increase; that is, the amount added to
the penalty as a catch-up cannot be greater than 150% of the
penalty, rather than being limited to 150% of the penalty itself. 28
U.S.C. 2461 note (``The amount of the increase in a civil monetary
penalty . . . shall not exceed 150 percent of the amount of that
civil monetary penalty on the date of enactment''). Thus, the cap is
x + 1.5x = 2.5x, where x is the penalty amount.
---------------------------------------------------------------------------
(4) Compare the dollar amount from (3) to the dollar amount in (2).
If (2) < (3), (2) is below the 150% cap and is the adjusted penalty. If
(2) > (3), the 150% cap is applied and becomes the adjusted penalty.
$77,114 < $187,500. Therefore, $77,114 is the adjusted penalty.
$225,867 < $300,000. Therefore, $225,867 is the adjusted penalty.
The following chart shows the values used in the calculations and
the rounded catch-up adjustment. All of the penalty adjustments fell
below the 150% cap on the catch-up adjustment:
----------------------------------------------------------------------------------------------------------------
Penalty when
49 U.S.C. Statute Year last set/ last set/ Multiplier Catch-up
adjusted adjusted from OMB adjustment
----------------------------------------------------------------------------------------------------------------
5123(a)(1)...................................... 2012 $75,000 1.02819 $77,114
5123(a)(2)...................................... 2012 175,000 1.02819 179,933
5123(a)(3)...................................... 2005 * 450 1.19397 537
5123(a)(3)...................................... 2012 ** 75,000 1.02819 77,114
46301(a)(1)..................................... 2003 25,000 1.28561 32,140
46301(a)(1)..................................... 2003 1,100 1.28561 1,414
46301(a)(3) \4\................................. N/A N/A N/A N/A
[[Page 43465]]
46301(a)(5)..................................... 2003 10,000 1.28561 12,856
46301(b)........................................ 1987 2,000 2.06278 4,126
46302........................................... 1984 10,000 2.25867 22,587
46318........................................... 2000 25,000 1.36689 34,172
46319........................................... 2003 10,000 1.28561 12,856
47531 \5\....................................... N/A N/A N/A N/A
51 U.S.C. 50917 \6\............................. 1984 100,000 2.25867 225,867
----------------------------------------------------------------------------------------------------------------
* Minimum.
** Maximum.
Provision for Reduced Catch-Up Adjustment
The 2015 Act allows an agency to request that a catch-up adjustment
be lower than what is calculated using the 2015 Act's formula. This
requires a determination by the head of the agency, following a notice
of proposed rulemaking, opportunity for comment, and a final rule, that
the catch-up adjustment will have a negative economic impact or has
social costs that outweigh the benefits. In addition, the director of
OMB must concur with the agency head's determination as the adjustment
is an economic transfer. The Administrator of the FAA does not believe
that any of the catch-up adjustments in this rule will have a negative
economic impact or have social costs that outweigh their benefits.
---------------------------------------------------------------------------
\4\ The penalty for 46301(a)(3) is an ``increase[ ] above the
otherwise applicable maximum amount under this section to an amount
not to exceed 3 times the amount of revenues that are used in
violation of such section.'' As it depends on the other maximum
penalties in 46301, there is no separate calculation needed for
46301(a)(3).
\5\ Section 47531 explicitly states that the applicable civil
penalties are ``the same . . . as a person violating section
44701(a) or (b) or any of sections 44702-44716 of this title.''
Sections 46301(a)(1)(A) and (a)(5) provide the civil penalty amounts
for those violations, and no separate calculation is needed.
\6\ Section 50917 was added by the Commercial Space Launch Act,
Public Law 98-575, section 19, 98 Stat. 3055, 3062 (1984), and was
codified as section 70115 of title 49 before being recodified in
title 51.
---------------------------------------------------------------------------
Amendments to Subpart H of 14 CFR Part 13
The FAA codified the statutory formula for inflation adjustments
under the FCPIAA and DCIA in subpart H of 14 CFR part 13. Rather than
amending the subpart to match the 2015 Act, paragraphs (a)-(c) of Sec.
13.305 containing the formula are being deleted as unnecessarily
duplicative of the statute. Section 13.303 is also being deleted
because it duplicates definitions of terms given in the statute.
Section 13.301(a) is being amended to include a reference to the 2015
Act.
Amendment to Section 406.9(a)
The current version of 14 CFR 406.9(a) states the maximum civil
penalty that can be imposed under its authority ``as adjusted for
inflation.'' This clause is being deleted as redundant and unnecessary.
The maximum penalty amount as amended by this rule will already be
adjusted for inflation, as will the future annual adjustments required
by the 2015 Act. Retaining this clause could also create a false
impression that the penalty amount is adjusted for inflation other than
by the 2015 Act. Therefore, the ``as adjusted for inflation'' clause is
being removed.
Good Cause for Not Having Notice and Comment
Under the Administrative Procedure Act, 5 U.S.C. 553(b)(B), a final
rule may be issued without public notice and comment if the agency
finds good cause that notice and comment are impracticable,
unnecessary, or contrary to public interest. Good cause exists in this
case to dispense with public notice and comment because adjustments to
civil penalties for inflation are required by Congress, as set forth in
Section 5 of the FCPIAA, as amended, in order to maintain the deterrent
effect of civil penalties and promote compliance with the law. As the
Administrator of the FAA has determined that none of the catch-up
adjustments should be lowered due to negative economic impact or social
costs that outweigh benefits, there is no place where the FAA might
apply discretion or policy judgments in calculating the adjustments.
The formula for determining the adjustments is laid out by statute and
cannot be amended by the FAA, even in response to public comment.
Accordingly, public comment is unnecessary in this case.
Regulatory Evaluation
Changes to Federal regulations must undergo several economic
analyses. First, Executive Order 12866 and Executive Order 13563 direct
that each Federal agency shall propose or adopt a regulation only upon
a reasoned determination that the benefits of the intended regulation
justify its costs. Second, the Regulatory Flexibility Act of 1980 (Pub.
L. 96-354) requires agencies to analyze the economic impact of
regulatory changes on small entities. Third, the Trade Agreements Act
(Pub. L. 96-39) prohibits agencies from setting standards that create
unnecessary obstacles to the foreign commerce of the United States. In
developing U.S. standards, the Trade Act requires agencies to consider
international standards and, where appropriate, that they be the basis
of U.S. standards. Fourth, the Unfunded Mandates Reform Act of 1995
(Pub. L. 104-4) requires agencies to prepare a written assessment of
the costs, benefits, and other effects of proposed or final rules that
include a Federal mandate likely to result in the expenditure by State,
local, or tribal governments, in the aggregate, or by the private
sector, of $100 million or more annually (adjusted for inflation with
base year of 1995). This portion of the preamble summarizes the FAA's
analysis of the economic impacts of this final rule.
Department of Transportation Order DOT 2100.5 prescribes policies
and procedures for simplification, analysis, and review of regulations.
If the expected cost impact is so minimal that a proposed or final rule
does not warrant a full evaluation, this order permits that a statement
to that effect and the basis for it to be included in the preamble if a
full regulatory evaluation of the cost and benefits is not prepared.
Such a determination has been made for this final rule. The reasoning
for this determination follows.
This rule adjusts for inflation to civil penalties for violations
of aviation safety, hazmat, and commercial space provisions in accord
with the Federal Civil Penalties Inflation Adjustment Act Improvement
Act (the 2015 Act), Public Law 114-74, Section 701 (November 2, 2015).
The Director of OMB provided guidance to agencies in a February 24,
2016 memorandum on how to calculate
[[Page 43466]]
the initial adjustment required by the 2015 Act. The FAA must follow
the direction of Congress and is using statutorily-mandated guidance
provided by OMB in calculating the catch-up inflation adjustment.
Applying Congress's directions and OMB's guidance, the FAA has
determined that this rule imposes no additional social cost. Civil
penalties are, like taxes, an economic transfer. OMB guidance A-4
states that transfers are monetary payments from one group to another
and thus not a social cost. OMB further dictates that transfers should
not be included in estimates of the benefits and costs due to
regulation. As transfers do not add social cost, this is a minimal cost
rule. OMB also directs that distributional effects of transfers should
be considered. The term ``distributional effect'' refers to the impact
of a regulatory action across the population and economy, divided up in
various ways (e.g. income groups, race, sex, industrial sector,
geography). Distributional effects may arise through transfer payments
like civil penalties that stem from regulatory enforcement action.
While persons paying civil penalties may experience distributional
effects, these discrete effects are far outweighed by the positive
effects of civil penalties. Compliance with FAA statutes and
regulations is essential to safety. Civil penalties are a punishment
for those who violate FAA statutes and regulations. They also deter
future violations. As a result, they support the FAA's mission of
aviation, hazmat, and commercial space safety, which benefits the
public at large. Thus, the cost impact of this rulemaking is minimal,
and a full regulatory evaluation is not required in accordance with DOT
Order 2100.5.
The FAA has determined that this final rule is not a ``significant
regulatory action'' as defined in section 3(f) of Executive Order 12866
because it does not have an annual effect on the economy of $100
million or more or adversely affect in a material way the economy, a
sector of the economy, productivity, competition, jobs, the
environment, public health or safety, or State, local, or tribal
governments or communities for the following reasons:
(i) Based on the FAA's review of civil penalties assessed in fiscal
year 2015, the total amount assessed was about $18 million. Even if
this total itself were increased to the catch-up adjustment cap of a
150% increase (which is not being done here), it would only result in
an increase of $27 million, bringing the total amount assessed to $45
million, which is substantially less than $100 million. Thus, the
amount of the statutorily mandated inflation adjustment in this
rulemaking will not have an annual effect on the economy of $100
million or more; and
(ii) The process of determining whether or not a civil penalty is
imposed is not affected by this change as this rulemaking only impacts
the minimum and maximum possible amount of the penalty.
The FAA has further determined that this final rule is not a
``significant regulatory action'' because it does not (a) create a
serious inconsistency or otherwise interfere with an action taken or
planned by another agency, (b) materially alter the budgetary impact of
entitlements, grants, user fees, or loan programs or the rights and
obligations of recipients thereof; or (c) raise novel legal or policy
issues arising out of legal mandates, the President's priorities, or
the principles set forth in Executive Order 12866. Finally, the FAA has
determined that this final rule is not ``significant'' as defined in
DOT's Regulatory Policies and Procedures.
Regulatory Flexibility Determination
The Regulatory Flexibility Act of 1980 (Pub. L. 96-354) (RFA)
establishes ``as a principle of regulatory issuance that agencies shall
endeavor, consistent with the objectives of the rule and of applicable
statutes, to fit regulatory and informational requirements to the scale
of the businesses, organizations, and governmental jurisdictions
subject to regulation.'' To achieve this principle, agencies are
required to solicit and consider flexible regulatory proposals and to
explain the rationale for their actions to assure that such proposals
are given serious consideration.'' The RFA covers a wide-range of small
entities, including small businesses, not-for-profit organizations, and
small governmental jurisdictions.
Agencies must perform a review to determine whether a rule will
have a significant economic impact on a substantial number of small
entities. If the agency determines that it will, the agency must
prepare a regulatory flexibility analysis as described in the RFA.
However, if an agency determines that a rule is not expected to
have a significant economic impact on a substantial number of small
entities, section 605(b) of the RFA provides that the head of the
agency may so certify and a regulatory flexibility analysis is not
required. The certification must include a statement providing the
factual basis for this determination, and the reasoning should be
clear.
The FAA believes that this final rule does not have a significant
economic impact on a substantial number of small entities for the
following reasons. While this final rule is likely to impact a
substantial number of small entities, it will impose only minimal
costs. This final rule simply identifies the amount of the inflation
adjustment to existing civil monetary penalty maximums and minimums for
violations of the statutory and regulatory provisions the FAA enforces.
The penalty amounts are those specified by statute or called for under
the inflation adjustment statutes, and the information in this rule is
required by the Debt Collection Improvement Act of 1996.\7\ As civil
penalties are economic transfers, by OMB direction these are not
included in the calculation of social costs.
---------------------------------------------------------------------------
\7\ The 2015 Act, Public Law 114-74, codified at 28 U.S.C. 2461
note, specifies the method of calculating the inflation adjustment,
and OMB Memorandum M-16-06 provides the guidance required by the
2015 Act for agencies in calculating the inflation adjustment.
---------------------------------------------------------------------------
In addition, FAA has determined the RFA does not apply to this
rulemaking. The 2015 Act requires FAA to publish an interim final rule
and there is good cause for issuing this rule without notice and
comment under 5 U.S.C. 553(b)(B). The Small Business Administration's A
Guide for Government Agencies: How to Comply with the Regulatory
Flexibility Act (2003), provides that:
If, under the APA or any rule of general applicability governing
federal grants to state and local governments, the agency is
required to publish a general notice of proposed rulemaking (NPRM),
the RFA must be considered [citing 5 U.S.C. 604(a)]. . . . If an
NPRM is not required, the RFA does not apply.
Because there is good cause for issuing this final rule without notice
and comment (i.e., without an NPRM), the RFA does not apply. Therefore,
as provided in section 605(b), the head of the FAA certifies that this
rule will not result in a significant economic impact on a substantial
number of small entities.
International Trade Impact Assessment
The Trade Agreements Act of 1979 (Pub. L. 96-39), as amended by the
Uruguay Round Agreements Act (Pub. L. 103-465), prohibits Federal
agencies from establishing standards or engaging in related activities
that create unnecessary obstacles to the foreign commerce of the United
States. Pursuant to these Acts, the establishment of standards is not
considered an unnecessary obstacle to the foreign commerce of the
United States, so long as the standard has a legitimate domestic
objective, such as
[[Page 43467]]
the protection of safety, and does not operate in a manner that
excludes imports that meet this objective. The statute also requires
consideration of international standards and, where appropriate, that
they be the basis for U.S. standards.
The FAA has assessed the potential effect of this final rule and
determined that it would impose identical inflation adjusted civil
penalties on domestic and international entities that violate aviation
safety, hazmat, and commercial space provisions in titles 49 and 51 of
the U.S. Code and regulations issued under those provisions, and thus
would have a neutral trade impact. Furthermore, the inflation
adjustment is a legitimate domestic objective preserving the existing
deterrent impact of aviation, hazmat, and commercial space safety
statutes and regulations. Therefore, we have determined that this rule
will result in a neutral impact on international trade.
Unfunded Mandates Assessment
Title II of the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-
4) requires each Federal agency to prepare a written statement
assessing the effects of any Federal mandate in a proposed or final
agency rule that may result in an expenditure of $100 million or more
(in 1995 dollars) in any one year by State, local, and tribal
governments, in the aggregate, or by the private sector; such a mandate
is deemed to be a ``significant regulatory action.'' The FAA currently
uses an inflation-adjusted value of $155 million in lieu of $100
million. This final rule does not contain such a mandate; therefore,
the requirements of Title II of the Act do not apply.
Paperwork Reduction Act
The Paperwork Reduction Act of 1995 (44 U.S.C. 3507(d)) requires
that the FAA consider the impact of paperwork and other information
collection burdens imposed on the public. The FAA has determined that
there are no current or new requirements for information collection
associated with this rule.
International Compatibility
In keeping with U.S. obligations under the Convention on
International Civil Aviation, it is FAA policy to conform to
International Civil Aviation Organization (ICAO) Standards and
Recommended Practices to the maximum extent practicable. The FAA has
determined that there are no ICAO Standards and Recommended Practices
that correspond to these regulations.
Environmental Analysis
FAA Order 1050.1F identifies FAA actions that are categorically
excluded from preparation of an environmental assessment or
environmental impact statement under the National Environmental Policy
Act in the absence of extraordinary circumstances. The FAA has
determined that this action qualifies for categorical exclusion under
the National Environmental Policy Act in accordance with FAA Order
1050.1F, ``Environmental Impacts: Policies and Procedures,'' paragraph
5-6.6.f, which covers regulations not expected to cause any potentially
significant environmental impacts. The FAA has also determined that
there are no extraordinary circumstances requiring an environmental
assessment or environmental impact statement.
Federalism
The FAA has analyzed this final rule under the principles and
criteria of Executive Order 13132, Federalism. The agency determined
that this action will not have a substantial direct effect on the
States, or the relationship between the Federal Government and the
States, or on the distribution of power and responsibilities among the
various levels of government, and, therefore, does not have federalism
implications.
Regulations That Significantly Affect Energy Supply, Distribution, or
Use
The FAA has analyzed this final rule under Executive Order 13211,
Actions Concerning Regulations that Significantly Affect Energy Supply,
Distribution, or Use (May 18, 2001). The agency has determined that it
is not a ``significant energy action'' under the executive order and it
is not likely to have a significant adverse effect on the supply,
distribution, or use of energy.
Availability of Rulemaking Documents
You can get an electronic copy of rulemaking documents using the
Internet by--
1. Searching the Federal eRulemaking Portal (https://www.regulations.gov);
2. Visiting the FAA's Regulations and Policies Web page at https://www.faa.gov/regulations_policies; or
3. Accessing the Government Printing Office's Web page at https://www.gpo.gov/fdsys.
You can also get a copy by sending a request to the Federal
Aviation Administration, Office of Rulemaking, ARM-1, 800 Independence
Avenue SW., Washington, DC 20591, or by calling (202) 267-9680. Make
sure to identify the amendment number or docket number of this
rulemaking.
List of Subjects
14 CFR Part 13
Administrative practice and procedure, Air transportation,
Hazardous materials transportation, Investigations, Law enforcement,
Penalties.
14 CFR Part 406
Administrative procedure and review, Commercial space
transportation, Enforcement, Investigations, Penalties, Rules of
adjudication.
The Amendment
In consideration of the foregoing, the Federal Aviation
Administration amends chapters I and III of title 14, Code of Federal
Regulations as follows:
CHAPTER I--FEDERAL AVIATION ADMINISTRATION, DEPARTMENT OF
TRANSPORTATION
PART 13--INVESTIGATIVE AND ENFORCEMENT PROCEDURES
0
1. The authority citation for part 13 continues to read as follows:
Authority: 18 U.S.C. 6002; 28 U.S.C. 2461 (note); 49 U.S.C.
106(g), 5121-5128, 40113-40114, 44103-44106, 44701-44703, 44709-
44710, 44713, 46101-46111, 46301, 46302 (for a violation of 49
U.S.C. 46504), 46304-46316, 46318, 46501-46502, 46504-46507, 47106,
47107, 47111, 47122, 47306, 47531-47532; 49 CFR 1.47.
0
2. Amend Sec. 13.301 by revising paragraph (a) and adding paragraph
(c) to read as follows:
Sec. 13.301 Scope and purpose.
(a) This subpart sets out the current adjusted maximum civil
monetary penalties or range of minimum and maximum civil monetary
penalties for each statutory civil penalty subject to the FAA's
jurisdiction under title 49 of the U.S. Code. These penalties have been
adjusted for inflation in conformity with the Federal Civil Penalties
Inflation Adjustment Act of 1990, 28 U.S.C. 2461 (note), as amended by
the Debt Collection Improvement Act of 1996, Public Law 104-134, April
26, 1996, and the Federal Civil Penalties Inflation Adjustment Act
Improvements Act of 2015, Public Law 114-74, November 2, 2015, in order
to maintain the deterrent effect of civil monetary penalties and to
promote compliance with the law.
* * * * *
(c) Minimum and maximum civil monetary penalties within the
jurisdiction of the FAA are as follows:
[[Page 43468]]
Table of Minimum and Maximum Civil Monetary Penalty Amounts for Certain Violations Occurring on or After August 1, 2016
--------------------------------------------------------------------------------------------------------------------------------------------------------
New or
adjusted Maximum penalty amount New or adjusted
United States Code citation Civil monetary penalty Minimum penalty minimum when last set or maximum penalty
description amount penalty adjusted by Congress amount
amount
--------------------------------------------------------------------------------------------------------------------------------------------------------
49 U.S.C. 5123(a), subparagraph (1). Violation of hazardous Deleted 7/6/2012....... N/A $75,000 per violation, $77,114.
materials transportation adjusted 7/6/2012.
law.
49 U.S.C. 5123(a), subparagraph (2). Violation of hazardous Deleted 7/6/2012....... N/A $175,000 per $179,933.
materials transportation violation, adjusted 7/
law resulting in death, 6/2012.
serious illness, severe
injury, or substantial
property destruction.
49 U.S.C. 5123(a), subparagraph (3). Violation of hazardous $450 per violation, set $537 $75,000 per violation, $77,114.
materials transportation 8/10/2005. adjusted 7/6/2012.
law relating to training.
49 U.S.C. 46301(a)(1)............... Violation by a person other N/A.................... N/A $25,000 per violation, $32,140.
than an individual or set 12/12/2003.
small business concern
under 49 U.S.C.
46301(a)(1)(A) or (B).
49 U.S.C. 46301(a)(1)............... Violation by an airman N/A.................... N/A $1,100 per violation, $1,414.
serving as an airman under adjusted 12/12/2003.
49 U.S.C. 46301(a)(1)(A)
or (B) (but not covered by
46301(a)(5)(A) or (B).
49 U.S.C. 46301(a)(1)............... Violation by an individual N/A.................... N/A $1,100 per violation, $1,414.
or small business concern adjusted 12/12/2003.
under 49 U.S.C.
46301(a)(1)(A) or (B) (but
not covered in 49 U.S.C.
46301(a)(5)).
49 U.S.C. 46301(a)(3)............... Violation of 49 U.S.C. N/A.................... N/A Increase above No change.
47107(b) (or any assurance otherwise applicable
made under such section) maximum amount not to
or 49 U.S.C. 47133. exceed 3 times the
amount of revenues
that are used in
violation of such
section.
49 U.S.C. 46301(a)(5)(A)............ Violation by an individual N/A.................... N/A $10,000 per violation, $12,856.
or small business concern set 12/12/2003.
(except an airman serving
as an airman) under 49
U.S.C. 46301(a)(5)(A)(i)
or (ii).
49 U.S.C. 46301(a)(5)(B)(i)......... Violation by an individual N/A.................... N/A $10,000 per violation, $12,856.
or small business concern set 12/12/2003.
related to the
transportation of
hazardous materials.
49 U.S.C. 46301(a)(5)(B)(ii)........ Violation by an individual N/A.................... N/A $10,000 per violation, $12,856.
or small business concern set 12/12/2003.
related to the
registration or
recordation under 49
U.S.C. chapter 441, of an
aircraft not used to
provide air transportation.
49 U.S.C. 46301(a)(5)(B)(iii)....... Violation by an individual N/A.................... N/A $10,000 per violation, $12,856.
or small business concern set 12/12/2003.
of 49 U.S.C. 44718(d),
relating to limitation on
construction or
establishment of landfills.
49 U.S.C. 46301(a)(5)(B)(iv)........ Violation by an individual N/A.................... N/A $10,000 per violation, $12,856.
or small business concern set 12/12/2003.
of 49 U.S.C. 44725,
relating to the safe
disposal of life-limited
aircraft parts.
49 U.S.C. 46301(b).................. Tampering with a smoke N/A.................... N/A $2,000 per violation, $4,126.
alarm device. set 12/22/1987.
49 U.S.C. 46302..................... Knowingly providing false N/A.................... N/A $10,000 per violation, $22,587.
information about alleged set 10/12/1984.
violation involving the
special aircraft
jurisdiction of the United
States.
49 U.S.C. 46318..................... Interference with cabin or N/A.................... N/A $25,000, set 4/5/2000. $34,172.
flight crew.
49 U.S.C. 46319..................... Permanent closure of an N/A.................... N/A $10,000 per day, set $12,856.
airport without providing 12/12/2003.
sufficient notice.
49 U.S.C. 47531..................... Violation of 49 U.S.C. N/A.................... N/A See 49 U.S.C. No change.
47528-47530, relating to 46301(a)(1)(A) and
the prohibition of (a)(5), above.
operating certain aircraft
not complying with stage 3
noise levels.
--------------------------------------------------------------------------------------------------------------------------------------------------------
[[Page 43469]]
Sec. Sec. 13.303 and 13.305 [Removed]
0
3. Remove Sec. Sec. 13.303 and 13.305.
CHAPTER III--COMMERCIAL SPACE TRANSPORTATION, FEDERAL AVIATION
ADMINISTRATION, DEPARTMENT OF TRANSPORTATION
PART 406--INVESTIGATIONS, ENFORCEMENT, AND ADMINISTRATIVE REVIEW
0
4. The authority citation for part 406 continues to read as follows:
Authority: 51 U.S.C. 50901-50923.
0
5. Revise Sec. 406.9(a) to read as follows:
Sec. 406.9 Civil penalties.
(a) Civil penalty liability. Under 51 U.S.C. 50917(c), a person
found by the FAA to have violated a requirement of the Act, a
regulation issued under the Act, or any term or condition of a license
or permit issued or transferred under the Act, is liable to the United
States for a civil penalty of not more than $225,867 for each
violation. A separate violation occurs for each day the violation
continues.
* * * * *
Issued under authority provided by 28 U.S.C. 2461 and 49 U.S.C.
106(f), 44701(a), and 46301 in Washington, DC, on June 23, 2016.
Michael P. Huerta,
Administrator.
[FR Doc. 2016-15744 Filed 7-1-16; 8:45 am]
BILLING CODE 4910-13-P
