Civil Penalties, 43524-43529 [2016-15800]

Download as PDF sradovich on DSK3GDR082PROD with RULES 43524 Federal Register / Vol. 81, No. 128 / Tuesday, July 5, 2016 / Rules and Regulations authority for this collection of information is contained in 47 U.S.C. 151, 152, 154, 154(i), 155(c), 157, 201, 202, 208, 214, 301, 302a, 303, 307, 308, 309, 310, 311, 314, 316, 319, 324, 331, 332, 333, 336, 534, 535 and 554. Nature and Extent of Confidentiality: There is no need for confidentiality required with this collection of information. Privacy Impact Assessment: Yes. Needs and Uses: On July 20, 2015, the Commission released the Part 1 R&O in which it updated many of its Part 1 competitive bidding rules (See Updating Part 1 Competitive Bidding Rules; Expanding the Economic and Innovation Opportunities of Spectrum Through Incentive Auctions; Petition of DIRECTV Group, Inc. and EchoStar LLC for Expedited Rulemaking to Amend Section 1.2105(a)(2)(xi) and 1.2106(a) of the Commission’s Rules and/or for Interim Conditional Waiver; Implementation of the Commercial Spectrum Enhancement Act and Modernization of the Commission’s Competitive Bidding Rules and Procedures, Report and Order, Order on Reconsideration of the First Report and Order, Third Order on Reconsideration of the Second Report and Order, and Third Report and Order, FCC 15–80, 30 FCC Rcd 7493 (2015), modified by Erratum, 30 FCC Rcd 8518 (2015) (Part 1 R&O)). Of relevance to the information collection at issue here, the Commission: (1) Implemented a new general prohibition on the filing of auction applications by entities controlled by the same individual or set of individuals (but with a limited exception for qualifying rural wireless partnerships); (2) modified the eligibility requirements for small business benefits, and updated the standardized schedule of small business sizes, including the gross revenues thresholds used to determine eligibility; (3) established a new bidding credit for eligible rural service providers; (4) adopted targeted attribution rules to prevent the unjust enrichment of ineligible entities; and (5) adopted rules prohibiting joint bidding arrangements with limited exceptions. The updated Part 1 rules apply to applicants seeking licenses and permits. Additionally, on June 2, 2014, the Commission released the Mobile Spectrum Holdings R&O, in which the Commission updated its spectrum screen and established rules for its upcoming auctions of low-band spectrum. Of relevance to the information collection at issue here, the Commission stated that it could reserve spectrum in order to ensure against excessive concentration in holdings of VerDate Sep<11>2014 16:06 Jul 01, 2016 Jkt 238001 below-1–GHz spectrum (In the Matter of Policies Regarding Mobile Spectrum Holdings, Expanding the Economic and Innovation Opportunities of Spectrum Through Incentive Auctions, FCC 14–63, Report and Order, 29 FCC Rcd 6133, 6190, para. 135 (2014) (Mobile Spectrum Holdings R&O). See also Application Procedures for Broadcast Incentive Auction Scheduled to Begin on March 29, 2016; Technical Formulas for Competitive Bidding, Public Notice, 30 FCC Rcd 11034, Appendix 3 (WTB 2015); Wireless Telecommunications Bureau Releases Updated List of Reserve-Eligible Nationwide Service Providers in each PEA for the Broadcast Incentive Auction, Public Notice, AU No. 14–252 (WTB 2016). The Commission also revised the currently approved collection of information under OMB Control Number 3060–0798 to permit the collection of the additional information for Commission licenses and permits, pursuant to the rules and information collection requirements adopted by the Commission in the Part 1 R&O and the Mobile Spectrum Holdings R&O. As part of the collection, the Commission is now approved for the information collection and recordkeeping requirements associated with 47 CFR 1.2110(j), 1.2112(b)(2)(iii), 1.2112(b)(2)(v), 1.2112(b)(2)(vii), and 1.2112(b)(2)(viii). Also, in certain circumstances, the Commission requires the applicant to provide copies of their agreements and/or submit exhibits. In addition, the Commission is now approved for various other, nonsubstantive editorial/consistency edits and updates to FCC Form 601 that correct inconsistent capitalization of words and other typographical errors, and better align the text on the form with the text in the Commission rules both generally and in connection with recent non-substantive, organizational amendments to the Commission’s rules. Federal Communications Commission. Gloria J. Miles, Federal Register Liaison Officer, Office of the Secretary. [FR Doc. 2016–15819 Filed 7–1–16; 8:45 am] BILLING CODE 6712–01–P PO 00000 Frm 00062 Fmt 4700 Sfmt 4700 DEPARTMENT OF TRANSPORTATION National Highway Traffic Safety Administration 49 CFR Part 578 [Docket No. NHTSA–2016–0075] RIN 2127–AL73 Civil Penalties National Highway Traffic Safety Administration (NHTSA), Department of Transportation (DOT). ACTION: Interim final rule. AGENCY: This interim final rule updates the maximum civil penalty amounts for violations of statutes and regulations administered by NHTSA pursuant the Federal Civil Penalties Inflation Adjustment Act Improvement Act of 2015. This final rule also amends our regulations to reflect the new civil penalty amounts for violations of the National Traffic and Motor Vehicle Safety (the Safety Act) Act authorized by the Fixing America’s Surface Transportation Act (FAST Act). DATES: Effective date: This rule is effective August 4, 2016. Petitions for reconsideration: Petitions for reconsideration of this final rule must be received not later than August 19, 2016. ADDRESSES: Any petitions for reconsideration should refer to the docket number of this document and be submitted to: Administrator, National Highway Traffic Safety Administration, 1200 New Jersey Avenue SE., West Building, Fourth Floor, Washington, DC 20590. FOR FURTHER INFORMATION CONTACT: Thomas Healy, Office of Chief Counsel, NHTSA, telephone (202) 366–2992, facsimile (202) 366–3820, 1200 New Jersey Ave SE., Washington, DC 20590. SUPPLEMENTARY INFORMATION: SUMMARY: I. Background On November 2, 2015, the Federal Civil Penalties Inflation Adjustment Act Improvement Act (the 2015 Act), Pub. L. 114–74, Section 701, was signed into law. The purpose of the 2015 Act is to improve the effectiveness of civil monetary penalties and to maintain their deterrent effect. The 2015 Act requires agencies to make an initial catch up adjustment to the civil monetary penalties they administer through an interim final rule and then to make subsequent annual adjustments for inflation. The amount of increase of any adjustment to a civil penalty pursuant to the 2015 Act is limited to E:\FR\FM\05JYR1.SGM 05JYR1 sradovich on DSK3GDR082PROD with RULES Federal Register / Vol. 81, No. 128 / Tuesday, July 5, 2016 / Rules and Regulations 150 percent of the current penalty. Agencies are required to issue the interim final rule with the initial catch up adjustment by July 1, 2016. The method of calculating inflationary adjustments in the 2015 Act differs substantially from the methods used in past inflationary adjustment rulemakings conducted pursuant to the Federal Civil Penalties Inflation Adjustment Act of 1990 (the Inflation Adjustment Act), Pub. L. 101–410. Previously, adjustments to civil penalties were conducted under rules that required significant rounding of figures. For example, a penalty increase that was greater than $1,000, but less than or equal to $10,000, would be rounded to the nearest multiple of $1,000. While this allowed penalties to be kept at round numbers, it meant that penalties would often not be increased at all if the inflation factor was not large enough. Furthermore, increases to penalties were capped at 10 percent. Over time, this formula caused penalties to lose value relative to total inflation. The 2015 Act has removed these rounding rules; now, penalties are simply rounded to the nearest $1. While this creates penalty values that are no longer round numbers, it does ensure that penalties will be increased each year to a figure commensurate with the actual calculated inflation. Furthermore, the 2015 Act ‘‘resets’’ the inflation calculations by excluding prior inflationary adjustments under the Inflation Adjustment Act, which contributed to a decline in the real value of penalty levels. To do this, the 2015 Act requires agencies to identify, for each penalty, the year and corresponding amount(s) for which the maximum penalty level or range of minimum and maximum penalties was established (i.e., originally enacted by Congress) or last adjusted other than pursuant to the Inflation Adjustment Act. The Director of the Office of Management and Budget (OMB) provided guidance to agencies in a February 24, 2016 memorandum on how to calculate the initial adjustment required by the 2015 Act.1 The initial catch up adjustment is based on the change between the Consumer Price Index for all Urban Consumers (CPI–U) for the month of October in the year the penalty amount was established or last adjusted by Congress and the October 1 Memorandum from the Director of OMB to Heads of Executive Departments and Agencies, Implementation of the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015 (Feb. 24, 2016), available at www.whitehouse.gov/ sites/default/files/omb/memoranda/2016/m-16– 06.pdf. VerDate Sep<11>2014 16:06 Jul 01, 2016 Jkt 238001 2015 CPI–U. The February 24, 2016 memorandum contains a table with a multiplier for the change in CPI–U from the year the penalty was established or last adjusted to 2015. To arrive at the adjusted penalty the agency must multiply the penalty amount when it was established or last adjusted by Congress, excluding adjustments under the Inflation Adjustment Act, by the multiplier for the increase in CPI–U from the year the penalty was established or adjusted provided in the February 24, 2016 memorandum. The 2015 Act limits the initial inflationary adjustment to 150 percent of the current penalty. To determine whether the increase in the adjusted penalty is less than 150 percent, the agency must multiply the current penalty by 250 percent. The adjusted penalty is the lesser of either the adjusted penalty based on the multiplier for CPI–U in Table A of the February 24, 2016 memorandum or an amount equal to 250% of the current penalty. This interim final rule adjusts the civil penalties for violations of statutes and regulations that NHTSA administers consistent with the February 24, 2016 memorandum. II. Inflationary Adjustments to Penalty Amounts in 49 CFR Part 578 Changes to Civil Penalties for School Bus Related Violations of the Safety Act (49 CFR 578.6(a)(2)) The maximum civil penalty for a single violation of 30112(a)(1) of Title 49 of the United States Code involving school buses or school bus equipment, or of the prohibition on school system purchases and leases of 15 passenger vans as specified in 30112(a)(2) of Title 49 of the United States Code was set at $10,000 when the penalty was established by the Safe, Accountable, Flexible, Efficient Transportation Equity Act: A Legacy for Users (SAFETEA–LU), Pub. L. 109–59, 119 Stat. 1942, enacted in 2005. Applying the multiplier for the increase in CPI–U for 2005 in Table A of the February 24, 2016 memorandum (1.19397) results in an adjusted civil penalty of $11,940. The maximum civil penalty for a related series of violations of 30112(a)(1) and 30112(a)(2) was $15,000,000 when the penalty was established by SAFETEA–LU in 2005. Applying the multiplier for the increase in CPI–U for 2005 results in an adjusted maximum civil penalty of $17,909,550. Changes to Civil Penalties for Filing False or Misleading Reports Under 49 U.S.C. 30165(a)(4) The Moving Ahead for Progress in the 21st Century Act (MAP–21) of 2012, PO 00000 Frm 00063 Fmt 4700 Sfmt 4700 43525 Pub. L. 112–141, established a maximum civil penalty for persons knowingly or willfully submitting materially false or misleading information to NHTSA after certifying that the information was accurate pursuant to 49 U.S.C. 30166(o) of $5,000 per day. Applying the multiplier for the increase in CPI–U for 2012 in Table A of the February 24, 2016 memorandum (1.02819) results in an adjusted civil penalty of $5,141. MAP–21 established a maximum civil penalty for a related series of daily violations of 49 U.S.C. 30166(o) of $1,000,000. Applying the multiplier for the increase in CPI–U for 2012 results in an adjusted civil penalty of $1,028,190 for a related series of daily violations of 49 U.S.C. 30166(o). Change to Penalty for Violation of 49 U.S.C. Chapter 305 (49 CFR 578.6(b)) The Anti Car Theft Act of 1992, Pub. L. 102–519, 204, 106 Stat. 3393 (1992) established a civil penalty of $1,000 for each violation of the reporting requirements related to maintaining the Nation Motor Vehicle Title Information System. Applying the multiplier for the increase in CPI–U for 1992 in Table A of the February 24, 2016 memorandum (1.67728) results in an adjusted civil penalty of $1,677. Change to Maximum Penalty Under 49 U.S.C. 32506(a) (49 CFR 578.6(c)) The Motor Vehicle Information and Cost Savings Act (Cost Savings Act), Pub. L. 92–513, 86 Stat. 953, (1972), established a civil penalty of $1,000 for each violation of a bumper standard established pursuant to the Cost Savings Act. Applying the multiplier for the increase in CPI–U for 1972 in Table A of the February 24, 2016 memorandum (5.62265) results in an adjusted civil penalty of $5,623. Since this would result in an increase to the current civil penalty of greater than 150 percent, the adjusted civil penalty is $2,750 (Current penalty $1,100 × 2.5). The Cost Savings Act also established a maximum civil penalty of $800,000 for a related series of violations of the bumper standards established pursuant to the Act. Applying the multiplier for the increase in CPI–U for 1972 in Table A of the February 24, 2016 memorandum (5.62265) results in an adjusted civil penalty of $4,498,120. Since this would result in an increase to the current civil penalty of greater than 150 percent, the adjusted civil penalty is $3,062,500 (Current penalty $1,225,000 × 2.5). E:\FR\FM\05JYR1.SGM 05JYR1 43526 Federal Register / Vol. 81, No. 128 / Tuesday, July 5, 2016 / Rules and Regulations Change to Penalties Under the Consumer Information Provisions (49 CFR 578.6(d)(1)) The Cost Savings Act established a civil penalty of $1,000 for each violation of 49 U.S.C. 32308(a) related to providing information on crashworthiness and damage susceptibility. Applying the multiplier for the increase in CPI–U for 1972 in Table A of the February 24, 2016 memorandum (5.62265) results in an adjusted civil penalty of $5,623. Since this would result in an increase to the current civil penalty of greater than 150 percent, the adjusted civil penalty is $2,750 (Current penalty $1,100 × 2.5). The Cost Savings established a maximum civil penalty of $400,000 for a series of related violations of 49 U.S.C. 32308(a). Applying the multiplier for the increase in CPI–U for 1972 in Table A of the February 24, 2016 memorandum (5.62265) results in an adjusted civil penalty of $2,249,060. Since this would result in an increase to the current civil penalty of greater than 150 percent, the adjusted civil penalty is $1,500,000 (Current penalty $600,000 × 2.5). Change to Penalties Under the Tire Consumer Information Provisions (49 CFR 578.6(d)(2)) The Energy Independence and Security Act of 2007, Pub. L. 110–140, 121 Stat. 1507 (2007) established a civil penalty of $50,000 for each violation related to the tire information fuel efficiency information program under 49 U.S.C. 32304A. Applying the multiplier for the increase in CPI–U for 2007 in Table A of the February 24, 2016 memorandum (1.13833) results in an adjusted civil penalty of $56,917. sradovich on DSK3GDR082PROD with RULES Change to Penalties Under the Country of Origin Content Labeling Provisions (49 CFR 578.6(d)(2)) The American Automobile Labeling Act, Pub L. 102–388, § 210, 106 Stat. 1556 (1992), established a civil penalty of $1,000 for willfully failing to affix, or failing to maintain, the label required by the Act. Applying the multiplier for the increase in CPI–U for 1992 in Table A of the February 24, 2016 memorandum (1.67728) results in an adjusted civil penalty of $1,677. Change to Penalties Under the Odometer Tampering and Disclosure Provisions (49 CFR 578.6(f)) MAP–21 adjusted the civil penalty for each violation of 49 U.S.C. Chapter 327 or a regulation issued thereunder related to odometer tampering and disclosure to $10,000 per violation. Applying the multiplier for the increase in CPI–U for VerDate Sep<11>2014 16:06 Jul 01, 2016 Jkt 238001 2012 in Table A of the February 24, 2016 memorandum (1.02819) results in an adjusted civil penalty of $10,282. MAP–21 established a maximum civil penalty of $1,000,000 for a related series of violations of 49 U.S.C. Chapter 327 or a regulation issued thereunder. Applying the multiplier for the increase in CPI–U for 2012 results in an adjusted civil penalty of $1,028,190 for a related series of violations. MAP–21 also adjusted the civil penalty for violations of 49 U.S.C. Chapter 327 or a regulation issued thereunder with intent to defraud to $10,000 per violation. Applying the multiplier for the increase in CPI–U for 2012 results in an adjusted civil penalty of $10,282. Change to Penalties Under the Vehicle Theft Protection Provisions (49 CFR 578.6(g)) The Motor Vehicle Theft Law Enforcement Act of 1984 (Vehicle Theft Act), Public Law 98–547, § 608, 98 Stat. 2762 (1984), established a civil penalty of $1,000 for each violation of 49 U.S.C. 33114(a)(1)–(4). Applying the multiplier for the increase in CPI–U for 1984 in Table A of the February 24, 2016 memorandum (2.25867) results in an adjusted civil penalty of $2,259. The Vehicle Theft Act also established a maximum penalty of $250,000 for a related series of violations of 49 U.S.C. 33114(a)(1)–(4). Applying the multiplier for the increase in CPI–U for 1984 results in an adjusted civil penalty of $564,668. The Anti Car Theft Act of 1992 established a civil penalty of $100,000 per day for violations of the Anti Car Theft Act related to operation of a chop shop. Applying the multiplier for the increase in CPI–U for 1992 in Table A of the February 24, 2016 memorandum (1.67728) results in an adjusted civil penalty of $167,728. Change to Penalties Under the Automobile Fuel Economy Provisions (49 CFR 578.6(g)) The Energy Policy and Conservation Act (EPCA) of 1975, Public Law 94–163, § 508, 89 Stat. 912 (1975), established a civil penalty of $10,000 for each violation of 49 U.S.C. 32911(a). Applying the multiplier for the increase in CPI–U for 1975 in Table A of the February 24, 2016 memorandum (4.3322) results in an adjusted civil penalty of $43,322. Since this would result in an increase to the current civil penalty of greater than 150 percent, the adjusted civil penalty is $40,000 (Current penalty $16,000 × 2.5). EPCA also established a civil penalty of $5 multiplied by each .1 of a mile a PO 00000 Frm 00064 Fmt 4700 Sfmt 4700 gallon by which the applicable average fuel economy standard under that section exceeds the average fuel economy for automobiles to which the standard applies manufactured by the manufacturer during the model year, multiplied by the number of those automobile and reduced by the credits available to the manufacturer. Applying the multiplier for the increase in CPI– U for 1975 results in an adjusted civil penalty of $22. Since this would result in an increase to the current civil penalty of greater than 150 percent, the adjusted civil penalty is $14 (Current penalty $5.50 × 2.5). In 1978 Congress amended EPCA, Public Law 95–619, 402, 92 Stat. 3255 (Nov. 9, 1978) to allow the Secretary of Transportation to establish a new civil penalty for each .1 of a mile a gallon by which the applicable average fuel economy standard under EPCA exceeds the average fuel economy for automobiles to which the standard applies manufactured by the manufacturer during the model year. These amendments, which are codified in 49 U.S.C. 32912(c), state that the new civil penalty cannot be more than $10. Applying the multiplier for the increase in CPI–U for 1978 in Table A of the February 24, 2016 memorandum (3.54453) to the $10 maximum penalty the Secretary is permitted to establish under 49 U.S.C. 32912(c) results in an adjusted civil penalty of $35. Since this would result in an increase of greater than 150 percent, the adjusted maximum civil penalty that the Secretary is permitted to establish under 49 U.S.C. 32912(c) is $25 (Current maximum penalty $10 × 2.5). Because the new maximum penalty that the Secretary is permitted to establish under 49 U.S.C. 32912(c) is $25, the new adjusted civil penalty in 49 CFR 578.6(h)(2) of $14 does not exceed the maximum penalty that the Secretary is permitted to impose. Change to Penalties Under the Medium and Heavy Duty Vehicle Fuel Efficiency Program (49 CFR 578.6(i)) In 2011, the agency established a maximum penalty of $37,500 per vehicle or engine for violations of 49 CFR 535. Applying the multiplier for the increase in CPI–U for 2011 in Table A of the February 24, 2016 memorandum (1.05042) results in an adjusted civil penalty of $39,391. III. Codification of Increases to NHTSA’s Civil Penalty Authority in the FAST Act On December 4, 2015, the FAST Act, Public Law 114–94, was signed into law. Section 24110 of the FAST Act E:\FR\FM\05JYR1.SGM 05JYR1 Federal Register / Vol. 81, No. 128 / Tuesday, July 5, 2016 / Rules and Regulations sradovich on DSK3GDR082PROD with RULES increased the maximum civil penalty that NHTSA may collect for each violation of the Safety Act under 49 U.S.C. 30165(a)(1) and 49 U.S.C. 30165(a)(3) to $21,000 per violation (previously $7,000) and the maximum amount of civil penalties that NHTSA can collect for a related series of violations to $105 million (previously $35 million). In order for these increases to become effective, the Secretary of Transportation was required to certify to Congress that NHTSA has issued the final rule required by Section 31203 of MAP–21. Section 31203 required NHTSA to provide an interpretation of civil penalty factors in 49 U.S.C. 30165 for NHTSA to consider in determining the amount of penalty or compromise for violations of the Safety Act. Pub. L. 112–141, § 31203, 126 Stat. 758 (2012). The increases in maximum civil penalties in Section 24110 of the FAST Act became effective the date of the Secretary’s certification. NHTSA issued the final rule required by Section 31203 of MAP–21 on February 24, 2016. On March 17, 2016, the Secretary certified to Congress by letter to the Chairman and Ranking Member of the Senate Committee on Commerce, Science, and Transportation, and to the Chairman and Ranking Member of the House Committee on Energy and Commerce that NHTSA had issued the Final Rule. On March 22, 2016, the Office of the Secretary of Transportation published a notice in the Federal Register notifying the public that the increase was in effect.2 NHTSA is codifying these increases in this interm final rule. IV. Public Comment NHTSA is promulgating this interim final rule to ensure that the amount of civil penalties contained in 49 CFR 578.6 reflect the statutorily mandated ranges as adjusted for inflation. Pursuant to the 2015 Act, NHTSA is required to promulgate a ‘‘catch-up adjustment’’ through an interim final rule. Pursuant to the 2015 Act and 5 U.S.C. 553(b)(3)(B), NHTSA finds that good cause exists for immediate implementation of this interim final rule without prior notice and comment because it would be impracticable to delay publication of this rule for notice and comment and because public comment is unnecessary. By operation of the Act, NHTSA must publish the catch-up adjustment by July 1, 2016. Additionally, the 2015 Act provides a clear formula for adjustment of the civil penalties, leaving the agency little room for discretion. Furthermore, the 2 81 FR 15413. VerDate Sep<11>2014 16:06 Jul 01, 2016 Jkt 238001 increases in NHTSA’s civil penalty authority authorized by the FAST Act are already in effect and the amendments merely update 49 CFR 578.6 to reflect the new statutory civil penalty. For these reasons, NHTSA finds that notice and comment would be impracticable and is unnecessary in this situation. V. Rulemaking Analyses and Notices Executive Order 12866, Executive Order 13563, and DOT Regulatory Policies and Procedures NHTSA has considered the impact of this rulemaking action under Executive Order 12866, Executive Order 13563, and the Department of Transportation’s regulatory policies and procedures. This rulemaking document was not reviewed under Executive Order 12866 or Executive Order 13563. This action is limited to the adoption of adjustments of civil penalties under statutes that the agency enforces, and has been determined to be not ‘‘significant’’ under the Department of Transportation’s regulatory policies and procedures and the policies of the Office of Management and Budget. Because this rulemaking does not change the number of entities that are subject to civil penalties, the impacts are limited. Furthermore, excluding the penalties in 49 CFR 578.6(h)(2) for violations of Corporate Average Fuel Economy standards, this final rule does not establish civil penalty amounts that NHTSA is required to seek. We also do not expect the increase in the civil penalty amount in 49 CFR 578.6(h)(2) to be economically significant. Over the last five model years, NHTSA has collected an average of $20 million per model year in civil penalties under 49 CFR 578.6(h)(2). Therefore, increasing the current civil penalty amount by 150 percent would not result in an annual effect on the economy of $100 million or more. Furthermore, NHTSA contends that the economic effects of increasing the civil penalty in 49 CFR 578.6(h)(2) are not directly proportional to the increase in the amount of civil penalty. Manufacturers could pursue several strategies to avoid liability for civil penalties under 49 CFR 578.6(h)(2), including purchasing offset credits from other manufacturers, production and marketing changes to influence the average fuel economy of vehicles produced by the manufacturer, and vehicle design changes intended to increase the vehicle’s fuel economy. NHTSA contends that manufacturers will pursue the strategy, or mix on strategies, that results in the lowest PO 00000 Frm 00065 Fmt 4700 Sfmt 4700 43527 overall cost to the manufacturer. For this reason the expected economic impacts of this rule can be expected to be lower than the amount of the increase to the civil penalty amount in 49 CFR 578.6(h)(2). Regulatory Flexibility Act We have also considered the impacts of this rule under the Regulatory Flexibility Act. I certify that this rule will not have a significant economic impact on a substantial number of small entities. The following provides the factual basis for this certification under 5 U.S.C. 605(b). The amendments almost entirely potentially affect manufacturers of motor vehicles and motor vehicle equipment. The Small Business Administration’s regulations define a small business in part as a business entity ‘‘which operates primarily within the United States.’’ 13 CFR 121.105(a). SBA’s size standards were previously organized according to Standard Industrial Classification (‘‘SIC’’) Codes. SIC Code 336211 ‘‘Motor Vehicle Body Manufacturing’’ applied a small business size standard of 1,000 employees or fewer. SBA now uses size standards based on the North American Industry Classification System (‘‘NAICS’’), Subsector 336— Transportation Equipment Manufacturing, which provides a small business size standard of 1,000 employees or fewer for automobile manufacturing businesses. Other motor vehicle-related industries have lower size requirements that range between 500 and 750 employees. For example, according to the SBA coding system, businesses that manufacture truck trailers, travel trailers/campers, carburetors, pistons, piston rings, valves, vehicular lighting equipment, motor vehicle seating/ interior trim, and motor vehicle stamping qualify as small businesses if they employ 500 or fewer employees. Similarly, businesses that manufacture gasoline engines, engine parts, electrical and electronic equipment (non-vehicle lighting), motor vehicle steering/ suspension components (excluding springs), motor vehicle brake systems, transmissions/power train parts, motor vehicle air-conditioning, and all other motor vehicle parts qualify as small businesses if they employ 750 or fewer employees. See http://www.sba.gov/ size/sizetable.pdf for further details. Many small businesses are subject to the penalty provisions of 49 U.S.C. Chapter 301 (Safety Act) and therefore may be affected by the adjustments made in this rulemaking. For example, based on comprehensive reporting E:\FR\FM\05JYR1.SGM 05JYR1 43528 Federal Register / Vol. 81, No. 128 / Tuesday, July 5, 2016 / Rules and Regulations sradovich on DSK3GDR082PROD with RULES pursuant to the early warning reporting (EWR) rule under the Safety Act, 49 CFR part 579, of the more than 60 light vehicle manufacturers reporting, over half are small businesses. Also, there are other, relatively low production vehicle manufacturers that are not subject to comprehensive EWR reporting. Furthermore, there are about 70 registered importers. Equipment manufacturers (including importers), entities selling motor vehicles and motor vehicle equipment, and motor vehicle repair businesses are also subject to penalties under 49 U.S.C. 30165. As noted throughout this preamble, this rule will only increase the penalty amounts that the agency could obtain for violations covered by 49 CFR 578.6. Under the Safety Act, the penalty provision requires the agency to take into account the size of a business when determining the appropriate penalty in an individual case. See 49 U.S.C. 30165(b). The agency would also consider the size of a business under its civil penalty policy when determining the appropriate civil penalty amount. See 62 FR 37115 (July 10, 1997) (NHTSA’s civil penalty policy under the Small Business Regulatory Enforcement Fairness Act (‘‘SBREFA’’)). The penalty adjustments would not affect our civil penalty policy under SBREFA. Since, this regulation does not establish a penalty amount that NHTSA is required to seek, except for civil penalties under 49 CFR 578.6(h)(2), this rule will not have a significant economic impact on small businesses. Furthermore, low volume manufacturers can petition for an exemption from the Corporate Average Fuel Economy standards under 49 CFR part 525. This will lessen the impacts of this rulemaking on small business by allowing them to avoid liability for penalties under 49 CFR 578.6(h)(2). Small organizations and governmental jurisdictions will not be significantly affected as the price of motor vehicles and equipment ought not change as the result of this rule. Executive Order 13132 (Federalism) Executive Order 13132 requires NHTSA to develop an accountable process to ensure ‘‘meaningful and timely input by State and local officials in the development of regulatory policies that have federalism implications.’’ ‘‘Policies that have federalism implications’’ is defined in the Executive Order to include regulations that have ‘‘substantial direct effects on the States, on the relationship between the national government and the States, or on the distribution of VerDate Sep<11>2014 16:06 Jul 01, 2016 Jkt 238001 power and responsibilities among the various levels of government.’’ Under Executive Order 13132, the agency may not issue a regulation with Federalism implications, that imposes substantial direct compliance costs, and that is not required by statute, unless the Federal government provides the funds necessary to pay the direct compliance costs incurred by State and local governments, the agency consults with State and local governments, or the agency consults with State and local officials early in the process of developing the proposed regulation. This rule will not have substantial direct effects on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government, as specified in Executive Order 13132. The reason is that this rule will generally apply to motor vehicle and motor vehicle equipment manufacturers (including importers), entities that sell motor vehicles and equipment and motor vehicle repair businesses. Thus, the requirements of Section 6 of the Executive Order do not apply. Unfunded Mandates Reform Act of 1995 The Unfunded Mandates Reform Act of 1995, Public Law 104–4, requires agencies to prepare a written assessment of the cost, 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 more than $100 million annually. Because this rule will not have a $100 million effect, no Unfunded Mandates assessment will be prepared. Executive Order 12778 (Civil Justice Reform) This rule does not have a retroactive or preemptive effect. Judicial review of this rule may be obtained pursuant to 5 U.S.C. 702. That section does not require that a petition for reconsideration be filed prior to seeking judicial review. Paperwork Reduction Act In accordance with the Paperwork Reduction Act of 1980, we state that there are no requirements for information collection associated with this rulemaking action. Privacy Act Please note that anyone is able to search the electronic form of all comments received into any of our dockets by the name of the individual PO 00000 Frm 00066 Fmt 4700 Sfmt 4700 submitting the comment (or signing the comment, if submitted on behalf of an association, business, labor union, etc.). You may review DOT’s complete Privacy Act Statement in the Federal Register published on April 11, 2000 (Volume 65, Number 70; Pages 19477– 78), or you may visit http://dms.dot.gov. List of Subjects in 49 CFR Part 578 Imports, Motor vehicle safety, Motor vehicles, Rubber and rubber products, Tires, Penalties. In consideration of the foregoing, 49 CFR part 578 is amended as set forth below. PART 578—CIVIL AND CRIMINAL PENALTIES 1. The authority citation for 49 CFR part 578 is revised to read as follows: ■ Authority: Pub. L. 101–410, Pub. L. 104– 134, Pub. L. 109–59, Pub. L. 114–74, Pub. L. 114–94, 49 U.S.C. 30165, 30170, 30505, 32308, 32309, 32507, 32709, 32710, 32902, 32912, and 33115; delegation of authority at 49 CFR 1.81, 1.95. 2. Section 578.6 is revised to read as follows: ■ § 578.6 Civil penalties for violations of specified provisions of Title 49 of the United States Code. (a) Motor vehicle safety—(1) In general. A person who violates any of sections 30112, 30115, 30117 through 30122, 30123(a), 30125(c), 30127, or 30141 through 30147 of Title 49 of the United States Code or a regulation prescribed under any of those sections is liable to the United States Government for a civil penalty of not more than $21,000 for each violation. A separate violation occurs for each motor vehicle or item of motor vehicle equipment and for each failure or refusal to allow or perform an act required by any of those sections. The maximum civil penalty under this paragraph for a related series of violations is $105,000,000. (2) School buses. Notwithstanding paragraph (a)(1) of this section, a person who: (i) Violates section 30112(a)(1) of Title 49 United States Code by the manufacture, sale, offer for sale, introduction or delivery for introduction into interstate commerce, or importation of a school bus or school bus equipment (as those terms are defined in 49 U.S.C. 30125(a)); or (ii) Violates section 30112(a)(2) of Title 49 United States Code, shall be subject to a civil penalty of not more than $11,940 for each violation. A separate violation occurs for each motor vehicle or item of motor vehicle E:\FR\FM\05JYR1.SGM 05JYR1 Federal Register / Vol. 81, No. 128 / Tuesday, July 5, 2016 / Rules and Regulations sradovich on DSK3GDR082PROD with RULES equipment and for each failure or refusal to allow or perform an act required by this section. The maximum penalty under this paragraph for a related series of violations is $17,909,550. (3) Section 30166. A person who violates section 30166 of Title 49 of the United States Code or a regulation prescribed under that section is liable to the United States Government for a civil penalty for failing or refusing to allow or perform an act required under that section or regulation. The maximum penalty under this paragraph is $21,000 per violation per day. The maximum penalty under this paragraph for a related series of daily violations is $105,000,000. (4) False and misleading reports. A person who knowingly and willfully submits materially false or misleading information to the Secretary, after certifying the same information as accurate under the certification process established pursuant to section 30166(o), shall be subject to a civil penalty of not more than $5,141 per day. The maximum penalty under this paragraph for a related series of daily violations is $1,028,190. (b) National Automobile Title Information System. An individual or entity violating 49 U.S.C. Chapter 305 is liable to the United States Government for a civil penalty of not more than $1,677 for each violation. (c) Bumper standards. (1) A person that violates 49 U.S.C. 32506(a) is liable to the United States Government for a civil penalty of not more than $2,750 for each violation. A separate violation occurs for each passenger motor vehicle or item of passenger motor vehicle equipment involved in a violation of 49 U.S.C. 32506(a)(1) or (4)— (i) That does not comply with a standard prescribed under 49 U.S.C. 32502, or (ii) For which a certificate is not provided, or for which a false or misleading certificate is provided, under 49 U.S.C. 32504. (2) The maximum civil penalty under this paragraph (c) for a related series of violations is $3,062,500. (d) Consumer information—(1) Crashworthiness and damage susceptibility. A VerDate Sep<11>2014 16:06 Jul 01, 2016 Jkt 238001 person who violates 49 U.S.C. 32308(a), regarding crashworthiness and damage susceptibility, is liable to the United States Government for a civil penalty of not more than $2,750 for each violation. Each failure to provide information or comply with a regulation in violation of 49 U.S.C. 32308(a) is a separate violation. The maximum penalty under this paragraph for a related series of violations is $1,500,000. (2) Consumer tire information. Any person who fails to comply with the national tire fuel efficiency program under 49 U.S.C. 32304A is liable to the United States Government for a civil penalty of not more than $56,917 for each violation. (e) Country of origin content labeling. A manufacturer of a passenger motor vehicle distributed in commerce for sale in the United States that willfully fails to attach the label required under 49 U.S.C. 32304 to a new passenger motor vehicle that the manufacturer manufactures or imports, or a dealer that fails to maintain that label as required under 49 U.S.C. 32304, is liable to the United States Government for a civil penalty of not more than $1,677 for each violation. Each failure to attach or maintain that label for each vehicle is a separate violation. (f) Odometer tampering and disclosure. (1) A person that violates 49 U.S.C. Chapter 327 or a regulation prescribed or order issued thereunder is liable to the United States Government for a civil penalty of not more than $10,281 for each violation. A separate violation occurs for each motor vehicle or device involved in the violation. The maximum civil penalty under this paragraph for a related series of violations is $1,028,190. (2) A person that violates 49 U.S.C. Chapter 327 or a regulation prescribed or order issued thereunder, with intent to defraud, is liable for three times the actual damages or $10,281, whichever is greater. (g) Vehicle theft protection. (1) A person that violates 49 U.S.C. 33114(a)(1)-(4) is liable to the United States Government for a civil penalty of not more than $2,259 for each violation. The failure of more than one part of a PO 00000 Frm 00067 Fmt 4700 Sfmt 9990 43529 single motor vehicle to conform to an applicable standard under 49 U.S.C. 33102 or 33103 is only a single violation. The maximum penalty under this paragraph for a related series of violations is $564,668. (2) A person that violates 49 U.S.C. 33114(a)(5) is liable to the United States Government for a civil penalty of not more than $167,728 a day for each violation. (h) Automobile fuel economy. (1) A person that violates 49 U.S.C. 32911(a) is liable to the United States Government for a civil penalty of not more than $40,000 for each violation. A separate violation occurs for each day the violation continues. (2) Except as provided in 49 U.S.C. 32912(c), a manufacturer that violates a standard prescribed for a model year under 49 U.S.C. 32902 is liable to the United States Government for a civil penalty of $14 multiplied by each .1 of a mile a gallon by which the applicable average fuel economy standard under that section exceeds the average fuel economy— (i) Calculated under 49 U.S.C. 32904(a)(1)(A) or (B) for automobiles to which the standard applies manufactured by the manufacturer during the model year; (ii) Multiplied by the number of those automobiles; and (iii) Reduced by the credits available to the manufacturer under 49 U.S.C. 32903 for the model year. (i) Medium- and heavy-duty vehicle fuel efficiency. The maximum civil penalty for a violation of the fuel consumption standards of 49 CFR part 535 is not more than $39,391 per vehicle or engine. The maximum civil penalty for a related series of violations shall be determined by multiplying $39,391 times the vehicle or engine production volume for the model year in question within the regulatory averaging set. Issued on: June 22, 2016. Mark R. Rosekind, Administrator. [FR Doc. 2016–15800 Filed 7–1–16; 8:45 am] BILLING CODE 4910–59–P E:\FR\FM\05JYR1.SGM 05JYR1

Agencies

[Federal Register Volume 81, Number 128 (Tuesday, July 5, 2016)]
[Rules and Regulations]
[Pages 43524-43529]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-15800]


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DEPARTMENT OF TRANSPORTATION

National Highway Traffic Safety Administration

49 CFR Part 578

[Docket No. NHTSA-2016-0075]
RIN 2127-AL73


Civil Penalties

AGENCY: National Highway Traffic Safety Administration (NHTSA), 
Department of Transportation (DOT).

ACTION: Interim final rule.

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SUMMARY: This interim final rule updates the maximum civil penalty 
amounts for violations of statutes and regulations administered by 
NHTSA pursuant the Federal Civil Penalties Inflation Adjustment Act 
Improvement Act of 2015. This final rule also amends our regulations to 
reflect the new civil penalty amounts for violations of the National 
Traffic and Motor Vehicle Safety (the Safety Act) Act authorized by the 
Fixing America's Surface Transportation Act (FAST Act).

DATES: Effective date: This rule is effective August 4, 2016.
    Petitions for reconsideration: Petitions for reconsideration of 
this final rule must be received not later than August 19, 2016.

ADDRESSES: Any petitions for reconsideration should refer to the docket 
number of this document and be submitted to: Administrator, National 
Highway Traffic Safety Administration, 1200 New Jersey Avenue SE., West 
Building, Fourth Floor, Washington, DC 20590.

FOR FURTHER INFORMATION CONTACT: Thomas Healy, Office of Chief
    Counsel, NHTSA, telephone (202) 366-2992, facsimile (202) 366-3820, 
1200 New Jersey Ave SE., Washington, DC 20590.

SUPPLEMENTARY INFORMATION: 

I. Background

    On November 2, 2015, the Federal Civil Penalties Inflation 
Adjustment Act Improvement Act (the 2015 Act), Pub. L. 114-74, Section 
701, was signed into law. The purpose of the 2015 Act is to improve the 
effectiveness of civil monetary penalties and to maintain their 
deterrent effect. The 2015 Act requires agencies to make an initial 
catch up adjustment to the civil monetary penalties they administer 
through an interim final rule and then to make subsequent annual 
adjustments for inflation. The amount of increase of any adjustment to 
a civil penalty pursuant to the 2015 Act is limited to

[[Page 43525]]

150 percent of the current penalty. Agencies are required to issue the 
interim final rule with the initial catch up adjustment by July 1, 
2016.
    The method of calculating inflationary adjustments in the 2015 Act 
differs substantially from the methods used in past inflationary 
adjustment rulemakings conducted pursuant to the Federal Civil 
Penalties Inflation Adjustment Act of 1990 (the Inflation Adjustment 
Act), Pub. L. 101-410. Previously, adjustments to civil penalties were 
conducted under rules that required significant rounding of figures. 
For example, a penalty increase that was greater than $1,000, but less 
than or equal to $10,000, would be rounded to the nearest multiple of 
$1,000. While this allowed penalties to be kept at round numbers, it 
meant that penalties would often not be increased at all if the 
inflation factor was not large enough. Furthermore, increases to 
penalties were capped at 10 percent. Over time, this formula caused 
penalties to lose value relative to total inflation.
    The 2015 Act has removed these rounding rules; now, penalties are 
simply rounded to the nearest $1. While this creates penalty values 
that are no longer round numbers, it does ensure that penalties will be 
increased each year to a figure commensurate with the actual calculated 
inflation. Furthermore, the 2015 Act ``resets'' the inflation 
calculations by excluding prior inflationary adjustments under the 
Inflation Adjustment Act, which contributed to a decline in the real 
value of penalty levels. To do this, the 2015 Act requires agencies to 
identify, for each penalty, the year and corresponding amount(s) for 
which the maximum penalty level or range of minimum and maximum 
penalties was established (i.e., originally enacted by Congress) or 
last adjusted other than pursuant to the Inflation Adjustment Act.
    The Director of the Office of Management and Budget (OMB) provided 
guidance to agencies in a February 24, 2016 memorandum on how to 
calculate the initial adjustment required by the 2015 Act.\1\ The 
initial catch up adjustment is based on the change between the Consumer 
Price Index for all Urban Consumers (CPI-U) for the month of October in 
the year the penalty amount was established or last adjusted by 
Congress and the October 2015 CPI-U. The February 24, 2016 memorandum 
contains a table with a multiplier for the change in CPI-U from the 
year the penalty was established or last adjusted to 2015. To arrive at 
the adjusted penalty the agency must multiply the penalty amount when 
it was established or last adjusted by Congress, excluding adjustments 
under the Inflation Adjustment Act, by the multiplier for the increase 
in CPI-U from the year the penalty was established or adjusted provided 
in the February 24, 2016 memorandum. The 2015 Act limits the initial 
inflationary adjustment to 150 percent of the current penalty. To 
determine whether the increase in the adjusted penalty is less than 150 
percent, the agency must multiply the current penalty by 250 percent. 
The adjusted penalty is the lesser of either the adjusted penalty based 
on the multiplier for CPI-U in Table A of the February 24, 2016 
memorandum or an amount equal to 250% of the current penalty. This 
interim final rule adjusts the civil penalties for violations of 
statutes and regulations that NHTSA administers consistent with the 
February 24, 2016 memorandum.
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    \1\ Memorandum from the Director of OMB to Heads of Executive 
Departments and Agencies, Implementation of the Federal Civil 
Penalties Inflation Adjustment Act Improvements Act of 2015 (Feb. 
24, 2016), available at www.whitehouse.gov/sites/default/files/omb/memoranda/2016/m-16-06.pdf.
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II. Inflationary Adjustments to Penalty Amounts in 49 CFR Part 578

Changes to Civil Penalties for School Bus Related Violations of the 
Safety Act (49 CFR 578.6(a)(2))

    The maximum civil penalty for a single violation of 30112(a)(1) of 
Title 49 of the United States Code involving school buses or school bus 
equipment, or of the prohibition on school system purchases and leases 
of 15 passenger vans as specified in 30112(a)(2) of Title 49 of the 
United States Code was set at $10,000 when the penalty was established 
by the Safe, Accountable, Flexible, Efficient Transportation Equity 
Act: A Legacy for Users (SAFETEA-LU), Pub. L. 109-59, 119 Stat. 1942, 
enacted in 2005. Applying the multiplier for the increase in CPI-U for 
2005 in Table A of the February 24, 2016 memorandum (1.19397) results 
in an adjusted civil penalty of $11,940. The maximum civil penalty for 
a related series of violations of 30112(a)(1) and 30112(a)(2) was 
$15,000,000 when the penalty was established by SAFETEA-LU in 2005. 
Applying the multiplier for the increase in CPI-U for 2005 results in 
an adjusted maximum civil penalty of $17,909,550.

Changes to Civil Penalties for Filing False or Misleading Reports Under 
49 U.S.C. 30165(a)(4)

    The Moving Ahead for Progress in the 21st Century Act (MAP-21) of 
2012, Pub. L. 112-141, established a maximum civil penalty for persons 
knowingly or willfully submitting materially false or misleading 
information to NHTSA after certifying that the information was accurate 
pursuant to 49 U.S.C. 30166(o) of $5,000 per day. Applying the 
multiplier for the increase in CPI-U for 2012 in Table A of the 
February 24, 2016 memorandum (1.02819) results in an adjusted civil 
penalty of $5,141. MAP-21 established a maximum civil penalty for a 
related series of daily violations of 49 U.S.C. 30166(o) of $1,000,000. 
Applying the multiplier for the increase in CPI-U for 2012 results in 
an adjusted civil penalty of $1,028,190 for a related series of daily 
violations of 49 U.S.C. 30166(o).

Change to Penalty for Violation of 49 U.S.C. Chapter 305 (49 CFR 
578.6(b))

    The Anti Car Theft Act of 1992, Pub. L. 102-519, 204, 106 Stat. 
3393 (1992) established a civil penalty of $1,000 for each violation of 
the reporting requirements related to maintaining the Nation Motor 
Vehicle Title Information System. Applying the multiplier for the 
increase in CPI-U for 1992 in Table A of the February 24, 2016 
memorandum (1.67728) results in an adjusted civil penalty of $1,677.

Change to Maximum Penalty Under 49 U.S.C. 32506(a) (49 CFR 578.6(c))

    The Motor Vehicle Information and Cost Savings Act (Cost Savings 
Act), Pub. L. 92-513, 86 Stat. 953, (1972), established a civil penalty 
of $1,000 for each violation of a bumper standard established pursuant 
to the Cost Savings Act. Applying the multiplier for the increase in 
CPI-U for 1972 in Table A of the February 24, 2016 memorandum (5.62265) 
results in an adjusted civil penalty of $5,623. Since this would result 
in an increase to the current civil penalty of greater than 150 
percent, the adjusted civil penalty is $2,750 (Current penalty $1,100 x 
2.5).
    The Cost Savings Act also established a maximum civil penalty of 
$800,000 for a related series of violations of the bumper standards 
established pursuant to the Act. Applying the multiplier for the 
increase in CPI-U for 1972 in Table A of the February 24, 2016 
memorandum (5.62265) results in an adjusted civil penalty of 
$4,498,120. Since this would result in an increase to the current civil 
penalty of greater than 150 percent, the adjusted civil penalty is 
$3,062,500 (Current penalty $1,225,000 x 2.5).

[[Page 43526]]

Change to Penalties Under the Consumer Information Provisions (49 CFR 
578.6(d)(1))

    The Cost Savings Act established a civil penalty of $1,000 for each 
violation of 49 U.S.C. 32308(a) related to providing information on 
crashworthiness and damage susceptibility. Applying the multiplier for 
the increase in CPI-U for 1972 in Table A of the February 24, 2016 
memorandum (5.62265) results in an adjusted civil penalty of $5,623. 
Since this would result in an increase to the current civil penalty of 
greater than 150 percent, the adjusted civil penalty is $2,750 (Current 
penalty $1,100 x 2.5). The Cost Savings established a maximum civil 
penalty of $400,000 for a series of related violations of 49 U.S.C. 
32308(a). Applying the multiplier for the increase in CPI-U for 1972 in 
Table A of the February 24, 2016 memorandum (5.62265) results in an 
adjusted civil penalty of $2,249,060. Since this would result in an 
increase to the current civil penalty of greater than 150 percent, the 
adjusted civil penalty is $1,500,000 (Current penalty $600,000 x 2.5).

Change to Penalties Under the Tire Consumer Information Provisions (49 
CFR 578.6(d)(2))

    The Energy Independence and Security Act of 2007, Pub. L. 110-140, 
121 Stat. 1507 (2007) established a civil penalty of $50,000 for each 
violation related to the tire information fuel efficiency information 
program under 49 U.S.C. 32304A. Applying the multiplier for the 
increase in CPI-U for 2007 in Table A of the February 24, 2016 
memorandum (1.13833) results in an adjusted civil penalty of $56,917.

Change to Penalties Under the Country of Origin Content Labeling 
Provisions (49 CFR 578.6(d)(2))

    The American Automobile Labeling Act, Pub L. 102-388, Sec.  210, 
106 Stat. 1556 (1992), established a civil penalty of $1,000 for 
willfully failing to affix, or failing to maintain, the label required 
by the Act. Applying the multiplier for the increase in CPI-U for 1992 
in Table A of the February 24, 2016 memorandum (1.67728) results in an 
adjusted civil penalty of $1,677.

Change to Penalties Under the Odometer Tampering and Disclosure 
Provisions (49 CFR 578.6(f))

    MAP-21 adjusted the civil penalty for each violation of 49 U.S.C. 
Chapter 327 or a regulation issued thereunder related to odometer 
tampering and disclosure to $10,000 per violation. Applying the 
multiplier for the increase in CPI-U for 2012 in Table A of the 
February 24, 2016 memorandum (1.02819) results in an adjusted civil 
penalty of $10,282. MAP-21 established a maximum civil penalty of 
$1,000,000 for a related series of violations of 49 U.S.C. Chapter 327 
or a regulation issued thereunder. Applying the multiplier for the 
increase in CPI-U for 2012 results in an adjusted civil penalty of 
$1,028,190 for a related series of violations.
    MAP-21 also adjusted the civil penalty for violations of 49 U.S.C. 
Chapter 327 or a regulation issued thereunder with intent to defraud to 
$10,000 per violation. Applying the multiplier for the increase in CPI-
U for 2012 results in an adjusted civil penalty of $10,282.

Change to Penalties Under the Vehicle Theft Protection Provisions (49 
CFR 578.6(g))

    The Motor Vehicle Theft Law Enforcement Act of 1984 (Vehicle Theft 
Act), Public Law 98-547, Sec.  608, 98 Stat. 2762 (1984), established a 
civil penalty of $1,000 for each violation of 49 U.S.C. 33114(a)(1)-
(4). Applying the multiplier for the increase in CPI-U for 1984 in 
Table A of the February 24, 2016 memorandum (2.25867) results in an 
adjusted civil penalty of $2,259. The Vehicle Theft Act also 
established a maximum penalty of $250,000 for a related series of 
violations of 49 U.S.C. 33114(a)(1)-(4). Applying the multiplier for 
the increase in CPI-U for 1984 results in an adjusted civil penalty of 
$564,668.
    The Anti Car Theft Act of 1992 established a civil penalty of 
$100,000 per day for violations of the Anti Car Theft Act related to 
operation of a chop shop. Applying the multiplier for the increase in 
CPI-U for 1992 in Table A of the February 24, 2016 memorandum (1.67728) 
results in an adjusted civil penalty of $167,728.

Change to Penalties Under the Automobile Fuel Economy Provisions (49 
CFR 578.6(g))

    The Energy Policy and Conservation Act (EPCA) of 1975, Public Law 
94-163, Sec.  508, 89 Stat. 912 (1975), established a civil penalty of 
$10,000 for each violation of 49 U.S.C. 32911(a). Applying the 
multiplier for the increase in CPI-U for 1975 in Table A of the 
February 24, 2016 memorandum (4.3322) results in an adjusted civil 
penalty of $43,322. Since this would result in an increase to the 
current civil penalty of greater than 150 percent, the adjusted civil 
penalty is $40,000 (Current penalty $16,000 x 2.5).
    EPCA also established a civil penalty of $5 multiplied by each .1 
of a mile a gallon by which the applicable average fuel economy 
standard under that section exceeds the average fuel economy for 
automobiles to which the standard applies manufactured by the 
manufacturer during the model year, multiplied by the number of those 
automobile and reduced by the credits available to the manufacturer. 
Applying the multiplier for the increase in CPI-U for 1975 results in 
an adjusted civil penalty of $22. Since this would result in an 
increase to the current civil penalty of greater than 150 percent, the 
adjusted civil penalty is $14 (Current penalty $5.50 x 2.5).
    In 1978 Congress amended EPCA, Public Law 95-619, 402, 92 Stat. 
3255 (Nov. 9, 1978) to allow the Secretary of Transportation to 
establish a new civil penalty for each .1 of a mile a gallon by which 
the applicable average fuel economy standard under EPCA exceeds the 
average fuel economy for automobiles to which the standard applies 
manufactured by the manufacturer during the model year. These 
amendments, which are codified in 49 U.S.C. 32912(c), state that the 
new civil penalty cannot be more than $10. Applying the multiplier for 
the increase in CPI-U for 1978 in Table A of the February 24, 2016 
memorandum (3.54453) to the $10 maximum penalty the Secretary is 
permitted to establish under 49 U.S.C. 32912(c) results in an adjusted 
civil penalty of $35. Since this would result in an increase of greater 
than 150 percent, the adjusted maximum civil penalty that the Secretary 
is permitted to establish under 49 U.S.C. 32912(c) is $25 (Current 
maximum penalty $10 x 2.5). Because the new maximum penalty that the 
Secretary is permitted to establish under 49 U.S.C. 32912(c) is $25, 
the new adjusted civil penalty in 49 CFR 578.6(h)(2) of $14 does not 
exceed the maximum penalty that the Secretary is permitted to impose.

Change to Penalties Under the Medium and Heavy Duty Vehicle Fuel 
Efficiency Program (49 CFR 578.6(i))

    In 2011, the agency established a maximum penalty of $37,500 per 
vehicle or engine for violations of 49 CFR 535. Applying the multiplier 
for the increase in CPI-U for 2011 in Table A of the February 24, 2016 
memorandum (1.05042) results in an adjusted civil penalty of $39,391.

III. Codification of Increases to NHTSA's Civil Penalty Authority in 
the FAST Act

    On December 4, 2015, the FAST Act, Public Law 114-94, was signed 
into law. Section 24110 of the FAST Act

[[Page 43527]]

increased the maximum civil penalty that NHTSA may collect for each 
violation of the Safety Act under 49 U.S.C. 30165(a)(1) and 49 U.S.C. 
30165(a)(3) to $21,000 per violation (previously $7,000) and the 
maximum amount of civil penalties that NHTSA can collect for a related 
series of violations to $105 million (previously $35 million). In order 
for these increases to become effective, the Secretary of 
Transportation was required to certify to Congress that NHTSA has 
issued the final rule required by Section 31203 of MAP-21. Section 
31203 required NHTSA to provide an interpretation of civil penalty 
factors in 49 U.S.C. 30165 for NHTSA to consider in determining the 
amount of penalty or compromise for violations of the Safety Act. Pub. 
L. 112-141, Sec.  31203, 126 Stat. 758 (2012). The increases in maximum 
civil penalties in Section 24110 of the FAST Act became effective the 
date of the Secretary's certification.
    NHTSA issued the final rule required by Section 31203 of MAP-21 on 
February 24, 2016. On March 17, 2016, the Secretary certified to 
Congress by letter to the Chairman and Ranking Member of the Senate 
Committee on Commerce, Science, and Transportation, and to the Chairman 
and Ranking Member of the House Committee on Energy and Commerce that 
NHTSA had issued the Final Rule. On March 22, 2016, the Office of the 
Secretary of Transportation published a notice in the Federal Register 
notifying the public that the increase was in effect.\2\ NHTSA is 
codifying these increases in this interm final rule.
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    \2\ 81 FR 15413.
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IV. Public Comment

    NHTSA is promulgating this interim final rule to ensure that the 
amount of civil penalties contained in 49 CFR 578.6 reflect the 
statutorily mandated ranges as adjusted for inflation. Pursuant to the 
2015 Act, NHTSA is required to promulgate a ``catch-up adjustment'' 
through an interim final rule. Pursuant to the 2015 Act and 5 U.S.C. 
553(b)(3)(B), NHTSA finds that good cause exists for immediate 
implementation of this interim final rule without prior notice and 
comment because it would be impracticable to delay publication of this 
rule for notice and comment and because public comment is unnecessary. 
By operation of the Act, NHTSA must publish the catch-up adjustment by 
July 1, 2016. Additionally, the 2015 Act provides a clear formula for 
adjustment of the civil penalties, leaving the agency little room for 
discretion. Furthermore, the increases in NHTSA's civil penalty 
authority authorized by the FAST Act are already in effect and the 
amendments merely update 49 CFR 578.6 to reflect the new statutory 
civil penalty. For these reasons, NHTSA finds that notice and comment 
would be impracticable and is unnecessary in this situation.

V. Rulemaking Analyses and Notices

Executive Order 12866, Executive Order 13563, and DOT Regulatory 
Policies and Procedures

    NHTSA has considered the impact of this rulemaking action under 
Executive Order 12866, Executive Order 13563, and the Department of 
Transportation's regulatory policies and procedures. This rulemaking 
document was not reviewed under Executive Order 12866 or Executive 
Order 13563. This action is limited to the adoption of adjustments of 
civil penalties under statutes that the agency enforces, and has been 
determined to be not ``significant'' under the Department of 
Transportation's regulatory policies and procedures and the policies of 
the Office of Management and Budget. Because this rulemaking does not 
change the number of entities that are subject to civil penalties, the 
impacts are limited. Furthermore, excluding the penalties in 49 CFR 
578.6(h)(2) for violations of Corporate Average Fuel Economy standards, 
this final rule does not establish civil penalty amounts that NHTSA is 
required to seek.
    We also do not expect the increase in the civil penalty amount in 
49 CFR 578.6(h)(2) to be economically significant. Over the last five 
model years, NHTSA has collected an average of $20 million per model 
year in civil penalties under 49 CFR 578.6(h)(2). Therefore, increasing 
the current civil penalty amount by 150 percent would not result in an 
annual effect on the economy of $100 million or more.
    Furthermore, NHTSA contends that the economic effects of increasing 
the civil penalty in 49 CFR 578.6(h)(2) are not directly proportional 
to the increase in the amount of civil penalty. Manufacturers could 
pursue several strategies to avoid liability for civil penalties under 
49 CFR 578.6(h)(2), including purchasing offset credits from other 
manufacturers, production and marketing changes to influence the 
average fuel economy of vehicles produced by the manufacturer, and 
vehicle design changes intended to increase the vehicle's fuel economy. 
NHTSA contends that manufacturers will pursue the strategy, or mix on 
strategies, that results in the lowest overall cost to the 
manufacturer. For this reason the expected economic impacts of this 
rule can be expected to be lower than the amount of the increase to the 
civil penalty amount in 49 CFR 578.6(h)(2).

Regulatory Flexibility Act

    We have also considered the impacts of this rule under the 
Regulatory Flexibility Act. I certify that this rule will not have a 
significant economic impact on a substantial number of small entities. 
The following provides the factual basis for this certification under 5 
U.S.C. 605(b). The amendments almost entirely potentially affect 
manufacturers of motor vehicles and motor vehicle equipment.
    The Small Business Administration's regulations define a small 
business in part as a business entity ``which operates primarily within 
the United States.'' 13 CFR 121.105(a). SBA's size standards were 
previously organized according to Standard Industrial Classification 
(``SIC'') Codes. SIC Code 336211 ``Motor Vehicle Body Manufacturing'' 
applied a small business size standard of 1,000 employees or fewer. SBA 
now uses size standards based on the North American Industry 
Classification System (``NAICS''), Subsector 336--Transportation 
Equipment Manufacturing, which provides a small business size standard 
of 1,000 employees or fewer for automobile manufacturing businesses. 
Other motor vehicle-related industries have lower size requirements 
that range between 500 and 750 employees.
    For example, according to the SBA coding system, businesses that 
manufacture truck trailers, travel trailers/campers, carburetors, 
pistons, piston rings, valves, vehicular lighting equipment, motor 
vehicle seating/interior trim, and motor vehicle stamping qualify as 
small businesses if they employ 500 or fewer employees. Similarly, 
businesses that manufacture gasoline engines, engine parts, electrical 
and electronic equipment (non-vehicle lighting), motor vehicle 
steering/suspension components (excluding springs), motor vehicle brake 
systems, transmissions/power train parts, motor vehicle air-
conditioning, and all other motor vehicle parts qualify as small 
businesses if they employ 750 or fewer employees. See http://www.sba.gov/size/sizetable.pdf for further details.
    Many small businesses are subject to the penalty provisions of 49 
U.S.C. Chapter 301 (Safety Act) and therefore may be affected by the 
adjustments made in this rulemaking. For example, based on 
comprehensive reporting

[[Page 43528]]

pursuant to the early warning reporting (EWR) rule under the Safety 
Act, 49 CFR part 579, of the more than 60 light vehicle manufacturers 
reporting, over half are small businesses. Also, there are other, 
relatively low production vehicle manufacturers that are not subject to 
comprehensive EWR reporting. Furthermore, there are about 70 registered 
importers. Equipment manufacturers (including importers), entities 
selling motor vehicles and motor vehicle equipment, and motor vehicle 
repair businesses are also subject to penalties under 49 U.S.C. 30165.
    As noted throughout this preamble, this rule will only increase the 
penalty amounts that the agency could obtain for violations covered by 
49 CFR 578.6. Under the Safety Act, the penalty provision requires the 
agency to take into account the size of a business when determining the 
appropriate penalty in an individual case. See 49 U.S.C. 30165(b). The 
agency would also consider the size of a business under its civil 
penalty policy when determining the appropriate civil penalty amount. 
See 62 FR 37115 (July 10, 1997) (NHTSA's civil penalty policy under the 
Small Business Regulatory Enforcement Fairness Act (``SBREFA'')). The 
penalty adjustments would not affect our civil penalty policy under 
SBREFA.
    Since, this regulation does not establish a penalty amount that 
NHTSA is required to seek, except for civil penalties under 49 CFR 
578.6(h)(2), this rule will not have a significant economic impact on 
small businesses. Furthermore, low volume manufacturers can petition 
for an exemption from the Corporate Average Fuel Economy standards 
under 49 CFR part 525. This will lessen the impacts of this rulemaking 
on small business by allowing them to avoid liability for penalties 
under 49 CFR 578.6(h)(2). Small organizations and governmental 
jurisdictions will not be significantly affected as the price of motor 
vehicles and equipment ought not change as the result of this rule.

Executive Order 13132 (Federalism)

    Executive Order 13132 requires NHTSA to develop an accountable 
process to ensure ``meaningful and timely input by State and local 
officials in the development of regulatory policies that have 
federalism implications.'' ``Policies that have federalism 
implications'' is defined in the Executive Order to include regulations 
that have ``substantial direct effects on the States, on the 
relationship between the national government and the States, or on the 
distribution of power and responsibilities among the various levels of 
government.'' Under Executive Order 13132, the agency may not issue a 
regulation with Federalism implications, that imposes substantial 
direct compliance costs, and that is not required by statute, unless 
the Federal government provides the funds necessary to pay the direct 
compliance costs incurred by State and local governments, the agency 
consults with State and local governments, or the agency consults with 
State and local officials early in the process of developing the 
proposed regulation.
    This rule will not have substantial direct effects on the States, 
on the relationship between the national government and the States, or 
on the distribution of power and responsibilities among the various 
levels of government, as specified in Executive Order 13132. The reason 
is that this rule will generally apply to motor vehicle and motor 
vehicle equipment manufacturers (including importers), entities that 
sell motor vehicles and equipment and motor vehicle repair businesses. 
Thus, the requirements of Section 6 of the Executive Order do not 
apply.

Unfunded Mandates Reform Act of 1995

    The Unfunded Mandates Reform Act of 1995, Public Law 104-4, 
requires agencies to prepare a written assessment of the cost, 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 more than 
$100 million annually. Because this rule will not have a $100 million 
effect, no Unfunded Mandates assessment will be prepared.

Executive Order 12778 (Civil Justice Reform)

    This rule does not have a retroactive or preemptive effect. 
Judicial review of this rule may be obtained pursuant to 5 U.S.C. 702. 
That section does not require that a petition for reconsideration be 
filed prior to seeking judicial review.

Paperwork Reduction Act

    In accordance with the Paperwork Reduction Act of 1980, we state 
that there are no requirements for information collection associated 
with this rulemaking action.

Privacy Act

    Please note that anyone is able to search the electronic form of 
all comments received into any of our dockets by the name of the 
individual submitting the comment (or signing the comment, if submitted 
on behalf of an association, business, labor union, etc.). You may 
review DOT's complete Privacy Act Statement in the Federal Register 
published on April 11, 2000 (Volume 65, Number 70; Pages 19477-78), or 
you may visit http://dms.dot.gov.

List of Subjects in 49 CFR Part 578

    Imports, Motor vehicle safety, Motor vehicles, Rubber and rubber 
products, Tires, Penalties.

    In consideration of the foregoing, 49 CFR part 578 is amended as 
set forth below.

PART 578--CIVIL AND CRIMINAL PENALTIES

0
1. The authority citation for 49 CFR part 578 is revised to read as 
follows:

    Authority: Pub. L. 101-410, Pub. L. 104-134, Pub. L. 109-59, 
Pub. L. 114-74, Pub. L. 114-94, 49 U.S.C. 30165, 30170, 30505, 
32308, 32309, 32507, 32709, 32710, 32902, 32912, and 33115; 
delegation of authority at 49 CFR 1.81, 1.95.


0
2. Section 578.6 is revised to read as follows:


Sec.  578.6  Civil penalties for violations of specified provisions of 
Title 49 of the United States Code.

    (a) Motor vehicle safety--(1) In general. A person who violates any 
of sections 30112, 30115, 30117 through 30122, 30123(a), 30125(c), 
30127, or 30141 through 30147 of Title 49 of the United States Code or 
a regulation prescribed under any of those sections is liable to the 
United States Government for a civil penalty of not more than $21,000 
for each violation. A separate violation occurs for each motor vehicle 
or item of motor vehicle equipment and for each failure or refusal to 
allow or perform an act required by any of those sections. The maximum 
civil penalty under this paragraph for a related series of violations 
is $105,000,000.
    (2) School buses. Notwithstanding paragraph (a)(1) of this section, 
a person who:
    (i) Violates section 30112(a)(1) of Title 49 United States Code by 
the manufacture, sale, offer for sale, introduction or delivery for 
introduction into interstate commerce, or importation of a school bus 
or school bus equipment (as those terms are defined in 49 U.S.C. 
30125(a)); or
    (ii) Violates section 30112(a)(2) of Title 49 United States Code, 
shall be subject to a civil penalty of not more than $11,940 for each 
violation. A separate violation occurs for each motor vehicle or item 
of motor vehicle

[[Page 43529]]

equipment and for each failure or refusal to allow or perform an act 
required by this section. The maximum penalty under this paragraph for 
a related series of violations is $17,909,550.
    (3) Section 30166. A person who violates section 30166 of Title 49 
of the United States Code or a regulation prescribed under that section 
is liable to the United States Government for a civil penalty for 
failing or refusing to allow or perform an act required under that 
section or regulation. The maximum penalty under this paragraph is 
$21,000 per violation per day. The maximum penalty under this paragraph 
for a related series of daily violations is $105,000,000.
    (4) False and misleading reports. A person who knowingly and 
willfully submits materially false or misleading information to the 
Secretary, after certifying the same information as accurate under the 
certification process established pursuant to section 30166(o), shall 
be subject to a civil penalty of not more than $5,141 per day. The 
maximum penalty under this paragraph for a related series of daily 
violations is $1,028,190.
    (b) National Automobile Title Information System. An individual or 
entity violating 49 U.S.C. Chapter 305 is liable to the United States 
Government for a civil penalty of not more than $1,677 for each 
violation.
    (c) Bumper standards. (1) A person that violates 49 U.S.C. 32506(a) 
is liable to the United States Government for a civil penalty of not 
more than $2,750 for each violation. A separate violation occurs for 
each passenger motor vehicle or item of passenger motor vehicle 
equipment involved in a violation of 49 U.S.C. 32506(a)(1) or (4)--
    (i) That does not comply with a standard prescribed under 49 U.S.C. 
32502, or
    (ii) For which a certificate is not provided, or for which a false 
or misleading certificate is provided, under 49 U.S.C. 32504.
    (2) The maximum civil penalty under this paragraph (c) for a 
related series of violations is $3,062,500.
    (d) Consumer information--(1) Crash-worthiness and damage 
susceptibility. A person who violates 49 U.S.C. 32308(a), regarding 
crashworthiness and damage susceptibility, is liable to the United 
States Government for a civil penalty of not more than $2,750 for each 
violation. Each failure to provide information or comply with a 
regulation in violation of 49 U.S.C. 32308(a) is a separate violation. 
The maximum penalty under this paragraph for a related series of 
violations is $1,500,000.
    (2) Consumer tire information. Any person who fails to comply with 
the national tire fuel efficiency program under 49 U.S.C. 32304A is 
liable to the United States Government for a civil penalty of not more 
than $56,917 for each violation.
    (e) Country of origin content labeling. A manufacturer of a 
passenger motor vehicle distributed in commerce for sale in the United 
States that willfully fails to attach the label required under 49 
U.S.C. 32304 to a new passenger motor vehicle that the manufacturer 
manufactures or imports, or a dealer that fails to maintain that label 
as required under 49 U.S.C. 32304, is liable to the United States 
Government for a civil penalty of not more than $1,677 for each 
violation. Each failure to attach or maintain that label for each 
vehicle is a separate violation.
    (f) Odometer tampering and disclosure. (1) A person that violates 
49 U.S.C. Chapter 327 or a regulation prescribed or order issued 
thereunder is liable to the United States Government for a civil 
penalty of not more than $10,281 for each violation. A separate 
violation occurs for each motor vehicle or device involved in the 
violation. The maximum civil penalty under this paragraph for a related 
series of violations is $1,028,190.
    (2) A person that violates 49 U.S.C. Chapter 327 or a regulation 
prescribed or order issued thereunder, with intent to defraud, is 
liable for three times the actual damages or $10,281, whichever is 
greater.
    (g) Vehicle theft protection. (1) A person that violates 49 U.S.C. 
33114(a)(1)-(4) is liable to the United States Government for a civil 
penalty of not more than $2,259 for each violation. The failure of more 
than one part of a single motor vehicle to conform to an applicable 
standard under 49 U.S.C. 33102 or 33103 is only a single violation. The 
maximum penalty under this paragraph for a related series of violations 
is $564,668.
    (2) A person that violates 49 U.S.C. 33114(a)(5) is liable to the 
United States Government for a civil penalty of not more than $167,728 
a day for each violation.
    (h) Automobile fuel economy. (1) A person that violates 49 U.S.C. 
32911(a) is liable to the United States Government for a civil penalty 
of not more than $40,000 for each violation. A separate violation 
occurs for each day the violation continues.
    (2) Except as provided in 49 U.S.C. 32912(c), a manufacturer that 
violates a standard prescribed for a model year under 49 U.S.C. 32902 
is liable to the United States Government for a civil penalty of $14 
multiplied by each .1 of a mile a gallon by which the applicable 
average fuel economy standard under that section exceeds the average 
fuel economy--
    (i) Calculated under 49 U.S.C. 32904(a)(1)(A) or (B) for 
automobiles to which the standard applies manufactured by the 
manufacturer during the model year;
    (ii) Multiplied by the number of those automobiles; and
    (iii) Reduced by the credits available to the manufacturer under 49 
U.S.C. 32903 for the model year.
    (i) Medium- and heavy-duty vehicle fuel efficiency. The maximum 
civil penalty for a violation of the fuel consumption standards of 49 
CFR part 535 is not more than $39,391 per vehicle or engine. The 
maximum civil penalty for a related series of violations shall be 
determined by multiplying $39,391 times the vehicle or engine 
production volume for the model year in question within the regulatory 
averaging set.

    Issued on: June 22, 2016.
Mark R. Rosekind,
Administrator.
[FR Doc. 2016-15800 Filed 7-1-16; 8:45 am]
 BILLING CODE 4910-59-P