Rules of Practice and Procedure; Adjusting Civil Money Penalties for Inflation, 7235-7237 [2021-01796]
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7235
Rules and Regulations
Federal Register
Vol. 86, No. 16
Wednesday, January 27, 2021
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.
FARM CREDIT ADMINISTRATION
12 CFR Part 622
RIN 3052–AD45
Rules of Practice and Procedure;
Adjusting Civil Money Penalties for
Inflation
Farm Credit Administration.
Final rule.
AGENCY:
ACTION:
This regulation implements
inflation adjustments to civil money
penalties (CMPs) that the Farm Credit
Administration (FCA) may impose or
enforce pursuant to the Farm Credit Act
of 1971, as amended (Farm Credit Act),
and pursuant to the Flood Disaster
Protection Act of 1973, as amended by
the National Flood Insurance Reform
Act of 1994, and further amended by the
Biggert-Waters Flood Insurance Reform
Act of 2012 (Biggert-Waters Act)
(collectively FDPA, as amended).
DATES: This regulation is effective on
January 27, 2021, and is applicable
beginning January 15, 2021.
FOR FURTHER INFORMATION CONTACT:
Brian Camp, Accountant, Office of
Regulatory Policy, Farm Credit
Administration, (703) 254–3004, TTY
(703) 883–4056, or Autumn R. Agans,
Senior Counsel, Office of General
Counsel, Farm Credit Administration,
(703) 883–4082, TTY (703) 883–4056.
SUPPLEMENTARY INFORMATION:
SUMMARY:
I. Objective
The objective of this regulation is to
adjust the maximum CMPs for inflation
through a final rulemaking to retain the
deterrent effect of such penalties.
khammond on DSKJM1Z7X2PROD with RULES
II. Background
A. Introduction
The Federal Civil Penalties Inflation
Adjustment Act of 1990, as amended by
the Debt Collection Improvement Act of
1996 (1996 Act) and the Federal Civil
Penalties Inflation Adjustment Act
Improvements Act of 2015 (2015 Act)
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16:30 Jan 26, 2021
Jkt 253001
(collectively, 1990 Act, as amended),
requires all Federal agencies with the
authority to enforce CMPs to evaluate
and adjust, if necessary, those CMPs
each year to ensure that they continue
to maintain their deterrent value and
promote compliance with the law.
Section 3(2) of the 1990 Act, as
amended, defines a civil monetary
penalty 1 as any penalty, fine, or other
sanction that: (1) Either is for a specific
monetary amount as provided by
Federal law or has a maximum amount
provided for by Federal law; (2) is
assessed or enforced by an agency
pursuant to Federal law; and (3) is
assessed or enforced pursuant to an
administrative proceeding or a civil
action in the Federal courts.2
The FCA imposes and enforces CMPs
through the Farm Credit Act 3 and the
FDPA, as amended.4 FCA’s regulations
governing CMPs are found in 12 CFR
parts 622 and 623. Part 622 establishes
rules of practice and procedure
applicable to formal and informal
hearings held before the FCA, and to
formal investigations conducted under
the Farm Credit Act. Part 623 prescribes
rules regarding persons who may
practice before the FCA and the
circumstances under which such
persons may be suspended or debarred
from practice before the FCA.
B. CMPs Issued Under the Farm Credit
Act
The Farm Credit Act provides that
any Farm Credit System (System)
institution or any officer, director,
employee, agent, or other person
participating in the conduct of the
affairs of a System institution who
violates the terms of a cease-and-desist
order that has become final pursuant to
section 5.25 or 5.26 of the Farm Credit
Act must pay a maximum daily amount
of $1,000,5 for each day such violation
1 Note: While the 1990 Act, as amended by 1996
and 2015 Acts, uses the term ‘‘civil monetary
penalties’’ for these penalties or other sanctions, the
Farm Credit Act and the FCA Regulations use the
term ‘‘civil money penalties.’’ Both terms have the
same meaning. Accordingly, this rule uses the term
civil money penalty, and both terms may be used
interchangeably.
2 See 28 U.S.C. 2461 note.
3 Public Law 92–181, as amended.
4 42 U.S.C. 4012a and Public Law 103–325, title
V, 108 Stat. 2160, 2255–87 (September 23, 1994).
5 The inflation-adjusted CMP in effect on January
15, 2020, for a violation of a final order is $2,404
per day, as set forth in § 622.61(a)(1) of FCA
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Frm 00001
Fmt 4700
Sfmt 4700
continues. This CMP maximum was set
by the Farm Credit Amendments Act of
1985, which amended the Farm Credit
Act. Orders issued by the FCA under
section 5.25 or 5.26 of the Farm Credit
Act include temporary and permanent
cease-and-desist orders. In addition,
section 5.32(h) of the Farm Credit Act
provides that any directive issued under
sections 4.3(b)(2), 4.3A(e), or 4.14A(i) of
the Farm Credit Act ‘‘shall be treated’’
as a final order issued under section
5.25 of the Farm Credit Act for purposes
of assessing a CMP.
Section 5.32(a) of the Farm Credit Act
also states that ‘‘[a]ny such institution or
person who violates any provision of
the [Farm Credit] Act or any regulation
issued under this Act shall forfeit and
pay a civil penalty of not more than
$500 6 per day for each day during
which such violation continues.’’ This
CMP maximum was set by the
Agricultural Credit Act of 1987, which
was enacted in 1988, and amends the
Farm Credit Act. Current inflationadjusted CMP maximums are set forth
in existing § 622.61 of FCA regulations.7
The FCA also enforces the FDPA, as
amended, which requires FCA to assess
CMPs for a pattern or practice of
committing certain specific actions in
violation of the National Flood
Insurance Program. The existing
maximum CMP for a violation under the
Flood Disaster Protection Act of 1973 is
$2,000.8 9
C. Federal Civil Penalties Inflation
Adjustment Act Improvements Act of
2015
1. In General
The 2015 Act required all Federal
agencies to adjust the CMPs yearly,
starting January 15, 2017.
Under Section 4(b) of the 1990 Act, as
amended, annual adjustments are to be
made yearly no later than January 15 of
regulations. We discovered a transposition error,
and note that the correct number for 2020 is $2,367.
6 The inflation-adjusted CMP in effect on January
15, 2020, for a violation of the Farm Credit Act or
a regulation issued under the Farm Credit Act is
$1,071 per day, as set forth in § 622.61(a)(2) of FCA
regulations.
7 Prior adjustments were made under the 1990
Act and continue to be made each year.
8 Public Law 112–141, 126 Stat. 405 (July 6,
2012).
9 The inflation-adjusted CMP in effect on January
15, 2020, for a flood insurance violation is $2,226,
as set forth in § 622.61(b)of FCA regulations.
E:\FR\FM\27JAR1.SGM
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7236
Federal Register / Vol. 86, No. 16 / Wednesday, January 27, 2021 / Rules and Regulations
each year.10 Section 6 of the 1990 Act,
as amended, states that any increase to
a civil monetary penalty under this 1990
Act applies only to civil monetary
penalties, including those whose
associated violation predated such
increase, which are assessed after the
date the increase takes effect.
Section 5(b) of the 1990 Act, as
amended, defines the term ‘‘cost-ofliving adjustment’’ as the percentage (if
any) for each civil monetary penalty by
which (1) the Consumer Price Index
(CPI) for the month of October of the
calendar year preceding the adjustment,
exceeds (2) the CPI for the month of
October 1 year before the month of
October referred to in (1) of the calendar
year in which the amount of such civil
monetary penalty was last set or
adjusted pursuant to law.11
The increase for each CMP adjusted
for inflation must be rounded using a
method prescribed by section 5(a) of the
1990 Act, as amended, by the 2015
Act.12
2. Other Adjustments
If a civil monetary penalty is subject
to a cost-of-living adjustment under the
1990 Act, as amended, but is adjusted
to an amount greater than the amount of
the adjustment required under the Act
within the 12 months preceding a
required cost-of-living adjustment, the
agency is not required to make the costof-living adjustment to that CMP in that
calendar year.13
III. Yearly Adjustments
A. Mathematical Calculations of 2021
Adjustments
The adjustment requirement affects
two provisions of section 5.32(a) of the
Farm Credit Act. For the 2021 yearly
adjustments to the CMPs set forth by the
Farm Credit Act, the calculation
required by the 2020 White House
Office of Management and Budget
(OMB) guidance 14 is based on the
percentage by which the CPI for October
2020 exceeds the CPIs for October 2019.
The OMB set forth guidance, as required
by the 2015 Act,15 with a multiplier for
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10 Public
Law 114–74, sec. 701(b)(1).
11 The CPI is published by the Department of
Labor, Bureau of Statistics, and is available at its
website: https://www.bls.gov/cpi/.
12 Pursuant to section 5(a)(3) of the 2015 Act, any
increase determined under the subsection shall be
rounded to the nearest $1.
13 Pursuant to section 4(d) of the 1990 Act, as
amended.
14 OMB Circular M–21–10, Implementation of
Penalty Inflation Adjustments for 2021, Pursuant to
the Federal Civil Penalties Inflation Adjustment Act
Improvements Act of 2015.
15 28 U.S.C. 2461 note, section 7(a).
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16:30 Jan 26, 2021
Jkt 253001
calculating the new CMP values.16 The
2020 OMB multiplier for the 2021 CMPs
is 1.01182.
The adjustment also affects the CMPs
set by the Flood Disaster Protection Act
of 1973, as amended. The adjustment
multiplier is the same for all FCA
enforced CMPs, set at 1.01182. The
maximum CMPs for violations were
created in 2012 by the Biggert-Waters
Act, which amended the Flood Disaster
Protection Act of 1973.
1. New Penalty Amount in § 622.61(a)(1)
The inflation-adjusted CMP currently
in effect for violations of a final order
occurring on or after January 15, 2020,
is a maximum daily amount of $2,367.17
Multiplying the $2,367 CMP by the 2020
OMB multiplier, 1.01182, yields a total
of $2,394.98. When that number is
rounded as required by section 5(a) of
the 1990 Act, as amended, the inflationadjusted maximum increases to $2,395.
Thus, the new CMP maximum is $2,395,
for violations that occur on or after
January 15, 2021.
2. New Penalty Amount in § 622.61(a)(2)
The inflation-adjusted CMP currently
in effect for violations of the Farm
Credit Act or regulations issued under
the Farm Credit Act occurring on or
after January 15, 2020, is a maximum
daily amount of $1,071.18 Multiplying
the $1,071 CMP maximum by the 2020
OMB multiplier, 1.01182, yields a total
of $1,083.66. When that number is
rounded as required by section 5(a) of
the 1990 Act, as amended the inflationadjusted maximum increases to $1,084.
Thus, the new CMP maximum is $1,084,
for violations that occur on or after
January 15, 2021.
3. New Penalty Amounts for Flood
Insurance Violations Under § 622.61(b)
The existing maximum CMP for a
pattern or practice of flood insurance
violations pursuant to 42 U.S.C.
4012a(f)(5) occurring on or after January
15, 2020, is $2,226. Multiplying $2,226
by the 2020 OMB multiplier, 1.01182,
yields a total of $2,252.31. When that
number is rounded as required by
section 5(a) of the 1990 Act, as
amended, the new maximum
assessment of the CMP for violating 42
U.S.C. 4012a(f)(5) is $2,252. Thus, the
16 OMB Circular M–21–10, Implementation of
Penalty Inflation Adjustments for 2021, Pursuant to
the Federal Civil Penalties Inflation Adjustment Act
Improvements Act of 2015.
17 12 CFR 622.61(a)(1). As noted above, we
discovered a transposition error, so the correct
maximum daily amount for 2020 is $2,367.
Accordingly, we use the corrected amount to
compute the maximum amount for CMP violations
that occur on or after January 15, 2021.
18 12 CFR 622.61(a)(2).
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Fmt 4700
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new CMP maximum is $2,252, for
violations that occur on or after January
15, 2021.
IV. Notice and Comment Not Required
by Administrative Procedure Act
The 1990 Act, as amended, gives
Federal agencies no discretion in the
adjustment of CMPs for the rate of
inflation. Further, these revisions are
ministerial, technical, and
noncontroversial. For these reasons, the
FCA finds good cause to determine that
public notice and an opportunity to
comment are impracticable,
unnecessary, and contrary to the public
interest pursuant to the Administrative
Procedure Act, 5 U.S.C. 553(b)(B), and
adopts this rule in final form.
V. Regulatory Flexibility Act
Pursuant to section 605(b) of the
Regulatory Flexibility Act (5 U.S.C. 601
et seq.), the FCA hereby certifies that
this final rule will not have a significant
economic impact on a substantial
number of small entities. Each of the
banks in the System, considered
together with its affiliated associations,
has assets and annual income in excess
of the amounts that would qualify them
as small entities. Therefore, System
institutions are not ‘‘small entities’’ as
defined in the Regulatory Flexibility
Act.
List of Subjects in 12 CFR Part 622
Administrative practice and
procedure, Crime, Investigations,
Penalties.
For the reasons stated in the
preamble, part 622 of chapter VI, title 12
of the Code of Federal Regulations is
amended as follows:
PART 622—RULES OF PRACTICE AND
PROCEDURE
1. The authority citation for part 622
continues to read as follows:
■
Authority: Secs. 5.9, 5.10, 5.17, 5.25–5.37
of the Farm Credit Act (12 U.S.C. 2243, 2244,
2252, 2261–2273); 28 U.S.C. 2461 note; and
42 U.S.C. 4012a(f).
■
2. Revise § 622.61 to read as follows:
§ 622.61 Adjustment of civil money
penalties by the rate of inflation under the
Federal Civil Penalties Inflation Adjustment
Act of 1990, as amended.
(a) The maximum amount of each
civil money penalty within FCA’s
jurisdiction is adjusted in accordance
with the Federal Civil Penalties
Inflation Adjustment Act of 1990, as
amended (28 U.S.C. 2461 note), as
follows:
(1) Amount of civil money penalty
imposed under section 5.32 of the Act
E:\FR\FM\27JAR1.SGM
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Federal Register / Vol. 86, No. 16 / Wednesday, January 27, 2021 / Rules and Regulations
for violation of a final order issued
under section 5.25 or 5.26 of the Act:
The maximum daily amount is $2,395
for violations that occur on or after
January 15, 2021.
(2) Amount of civil money penalty for
violation of the Act or regulations: The
maximum daily amount is $1,084 for
each violation that occurs on or after
January 15, 2021.
(b) The maximum civil money penalty
amount assessed under 42 U.S.C.
4012a(f) is $2,252 for each violation that
occurs on or after January 15, 2021, with
no cap on the total amount of penalties
that can be assessed against any single
institution during any calendar year.
Dated: January 22, 2021.
Dale Aultman,
Secretary, Farm Credit Administration Board.
[FR Doc. 2021–01796 Filed 1–26–21; 8:45 am]
BILLING CODE 6705–01–P
DEPARTMENT OF COMMERCE
International Trade Administration
19 CFR Part 361
[Docket No. 210122–0011]
RIN 0625–AB18
Aluminum Import Monitoring and
Analysis System: Delay of Effective
Date
Enforcement and Compliance,
International Trade Administration,
Department of Commerce.
ACTION: Final rule; delay of effective
date; request for comments.
AGENCY:
The U.S. Department of
Commerce (Commerce) is delaying the
effective date of the final rule, entitled
‘‘Aluminum Import Monitoring and
Analysis System,’’ from January 25,
2021 until March 29, 2021. Commerce is
also soliciting comments on the final
rule.
SUMMARY:
The effective date of the rule
amending 19 CFR part 361published at
85 FR 83804 (Dec. 23, 2020), is delayed
from January 25, 2021, to March 29,
2021.
To be assured of consideration,
written comments on the final rule must
be received no later than February 26,
2021.
ADDRESSES: Submit comments only
through the Federal eRulemaking Portal
at https://www.Regulations.gov, Docket
No. ITA–2021–0001.1 Due to the
khammond on DSKJM1Z7X2PROD with RULES
DATES:
1 Comments on the previously issued proposed
rule, Aluminum Import Monitoring and Analysis
System, 85 FR 23748 (April 29, 2020) (Proposed
VerDate Sep<11>2014
16:30 Jan 26, 2021
Jkt 253001
COVID–19 situation, Commerce is not
able to accept comments submitted by
mail or hand-delivery at this time. All
comments submitted during the
comment period permitted by this
document will be a matter of public
record and will generally be available
on the Federal eRulemaking Portal at
https://www.Regulations.gov. Commerce
will not accept response comments
accompanied by a request that part or
all of the material be treated
confidentially because of its business
proprietary nature or for any other
reason. Therefore, do not submit
confidential business information or
otherwise sensitive or protected
information.
Any questions concerning the process
for submitting comments should be
submitted to Enforcement & Compliance
Communications office at (202) 482–
0063 or ECCommunications@trade.gov.
The AIM system website is https://
www.trade.gov/aluminum.
FOR FURTHER INFORMATION CONTACT: Julie
Al-Saadawi at (202) 482–1930 or Jessica
Link at (202) 482–1411.
SUPPLEMENTARY INFORMATION: On
December 23, 2020, Commerce
published the final rule and
accompanying regulations establishing
the Aluminum Import Monitoring and
Analysis (AIM) system.2 The original
effective date for the Final Rule was
January 25, 2021. Commerce is now
delaying the effective date until March
29, 2021.
This delay in effective date is
necessary to allow the incoming
Administration time to review the Final
Rule and consider any additional
comments before implementation.
Unless otherwise announced, the
majority of the final rule will be
effective on March 29, 2021. The
remaining portions of the final rule
concerning an option to state
‘‘unknown’’ for certain fields on the
aluminum license form will be effective
on December 24, 2021, as originally
stated in the final rule. For further
background and information, see the
Final Rule. Parties are invited to
comment on all aspects of the Final Rule
and the AIM system.
The AIM system website (https://
www.trade.gov/aluminum) continues to
be operational. However, licenses will
not be required for covered aluminum
imports until on or after March 29,
2021. Further guidance on licenses
already issued and the issuance of new
Rule), can be found by searching for the Proposed
Rule on the Federal eRulemaking portal at https://
www.regulations.gov.
2 Aluminum Import Monitoring and Analysis
System, 85 FR 83804 (Dec. 23, 2020) (Final Rule).
PO 00000
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7237
licenses during the intervening period
prior to March 29, 2021 will be
provided on the AIM system website.
Dated: January 22, 2021.
Christian Marsh,
Acting Assistant Secretary for Enforcement
and Compliance.
[FR Doc. 2021–01804 Filed 1–22–21; 4:15 pm]
BILLING CODE 3510–DS–P
DEPARTMENT OF LABOR
Office of the Secretary
29 CFR Part 89
RIN 1290–AA41
Rescission of Department of Labor
Rule on Guidance
Office of the Secretary, U.S.
Department of Labor.
ACTION: Final rule; rescission of
regulations.
AGENCY:
On August 28, 2020, the
Department of Labor published a final
rule on guidance implementing an
Executive order entitled ‘‘Promoting the
Rule of Law Through Improved Agency
Guidance Documents,’’ and providing
policy and requirements for issuing,
modifying, withdrawing, and using
guidance; making guidance available to
the public; a notice and comment
process for significant guidance; and
taking and responding to petitions about
guidance. In accordance with the
‘‘Executive Order on Revocation of
Certain Executive Orders Concerning
Federal Regulation,’’ issued by
President Biden on January 20, 2021,
this final rule rescinds the Department’s
rule on guidance.
DATES: This final rule is effective
January 27, 2021.
FOR FURTHER INFORMATION CONTACT: Erin
FitzGerald, Senior Policy Advisor, U.S.
Department of Labor, Room S–2312, 200
Constitution Avenue NW, Washington,
DC 20210; telephone: (202) 693–5076
(this is not a toll-free number).
SUPPLEMENTARY INFORMATION:
SUMMARY:
I. Discussion
On August 28, 2020, the Department
of Labor published an internal final rule
on guidance implementing E.O. 13891,
‘‘Promoting the Rule of Law Through
Improved Agency Guidance
Documents,’’ signed by President
Trump on October 9, 2019. As required
by the E.O., the rule contained policy
and requirements for issuing,
modifying, withdrawing, and using
guidance; making guidance available to
the public; a notice and comment
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]]>Agencies
[Federal Register Volume 86, Number 16 (Wednesday, January 27, 2021)]
[Rules and Regulations]
[Pages 7235-7237]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-01796]
========================================================================
Rules and Regulations
Federal Register
________________________________________________________________________
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.
========================================================================
Federal Register / Vol. 86, No. 16 / Wednesday, January 27, 2021 /
Rules and Regulations
[[Page 7235]]
FARM CREDIT ADMINISTRATION
12 CFR Part 622
RIN 3052-AD45
Rules of Practice and Procedure; Adjusting Civil Money Penalties
for Inflation
AGENCY: Farm Credit Administration.
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: This regulation implements inflation adjustments to civil
money penalties (CMPs) that the Farm Credit Administration (FCA) may
impose or enforce pursuant to the Farm Credit Act of 1971, as amended
(Farm Credit Act), and pursuant to the Flood Disaster Protection Act of
1973, as amended by the National Flood Insurance Reform Act of 1994,
and further amended by the Biggert-Waters Flood Insurance Reform Act of
2012 (Biggert-Waters Act) (collectively FDPA, as amended).
DATES: This regulation is effective on January 27, 2021, and is
applicable beginning January 15, 2021.
FOR FURTHER INFORMATION CONTACT: Brian Camp, Accountant, Office of
Regulatory Policy, Farm Credit Administration, (703) 254-3004, TTY
(703) 883-4056, or Autumn R. Agans, Senior Counsel, Office of General
Counsel, Farm Credit Administration, (703) 883-4082, TTY (703) 883-
4056.
SUPPLEMENTARY INFORMATION:
I. Objective
The objective of this regulation is to adjust the maximum CMPs for
inflation through a final rulemaking to retain the deterrent effect of
such penalties.
II. Background
A. Introduction
The Federal Civil Penalties Inflation Adjustment Act of 1990, as
amended by the Debt Collection Improvement Act of 1996 (1996 Act) and
the Federal Civil Penalties Inflation Adjustment Act Improvements Act
of 2015 (2015 Act) (collectively, 1990 Act, as amended), requires all
Federal agencies with the authority to enforce CMPs to evaluate and
adjust, if necessary, those CMPs each year to ensure that they continue
to maintain their deterrent value and promote compliance with the law.
Section 3(2) of the 1990 Act, as amended, defines a civil monetary
penalty \1\ as any penalty, fine, or other sanction that: (1) Either is
for a specific monetary amount as provided by Federal law or has a
maximum amount provided for by Federal law; (2) is assessed or enforced
by an agency pursuant to Federal law; and (3) is assessed or enforced
pursuant to an administrative proceeding or a civil action in the
Federal courts.\2\
---------------------------------------------------------------------------
\1\ Note: While the 1990 Act, as amended by 1996 and 2015 Acts,
uses the term ``civil monetary penalties'' for these penalties or
other sanctions, the Farm Credit Act and the FCA Regulations use the
term ``civil money penalties.'' Both terms have the same meaning.
Accordingly, this rule uses the term civil money penalty, and both
terms may be used interchangeably.
\2\ See 28 U.S.C. 2461 note.
---------------------------------------------------------------------------
The FCA imposes and enforces CMPs through the Farm Credit Act \3\
and the FDPA, as amended.\4\ FCA's regulations governing CMPs are found
in 12 CFR parts 622 and 623. Part 622 establishes rules of practice and
procedure applicable to formal and informal hearings held before the
FCA, and to formal investigations conducted under the Farm Credit Act.
Part 623 prescribes rules regarding persons who may practice before the
FCA and the circumstances under which such persons may be suspended or
debarred from practice before the FCA.
---------------------------------------------------------------------------
\3\ Public Law 92-181, as amended.
\4\ 42 U.S.C. 4012a and Public Law 103-325, title V, 108 Stat.
2160, 2255-87 (September 23, 1994).
---------------------------------------------------------------------------
B. CMPs Issued Under the Farm Credit Act
The Farm Credit Act provides that any Farm Credit System (System)
institution or any officer, director, employee, agent, or other person
participating in the conduct of the affairs of a System institution who
violates the terms of a cease-and-desist order that has become final
pursuant to section 5.25 or 5.26 of the Farm Credit Act must pay a
maximum daily amount of $1,000,\5\ for each day such violation
continues. This CMP maximum was set by the Farm Credit Amendments Act
of 1985, which amended the Farm Credit Act. Orders issued by the FCA
under section 5.25 or 5.26 of the Farm Credit Act include temporary and
permanent cease-and-desist orders. In addition, section 5.32(h) of the
Farm Credit Act provides that any directive issued under sections
4.3(b)(2), 4.3A(e), or 4.14A(i) of the Farm Credit Act ``shall be
treated'' as a final order issued under section 5.25 of the Farm Credit
Act for purposes of assessing a CMP.
---------------------------------------------------------------------------
\5\ The inflation-adjusted CMP in effect on January 15, 2020,
for a violation of a final order is $2,404 per day, as set forth in
Sec. 622.61(a)(1) of FCA regulations. We discovered a transposition
error, and note that the correct number for 2020 is $2,367.
---------------------------------------------------------------------------
Section 5.32(a) of the Farm Credit Act also states that ``[a]ny
such institution or person who violates any provision of the [Farm
Credit] Act or any regulation issued under this Act shall forfeit and
pay a civil penalty of not more than $500 \6\ per day for each day
during which such violation continues.'' This CMP maximum was set by
the Agricultural Credit Act of 1987, which was enacted in 1988, and
amends the Farm Credit Act. Current inflation-adjusted CMP maximums are
set forth in existing Sec. 622.61 of FCA regulations.\7\
---------------------------------------------------------------------------
\6\ The inflation-adjusted CMP in effect on January 15, 2020,
for a violation of the Farm Credit Act or a regulation issued under
the Farm Credit Act is $1,071 per day, as set forth in Sec.
622.61(a)(2) of FCA regulations.
\7\ Prior adjustments were made under the 1990 Act and continue
to be made each year.
---------------------------------------------------------------------------
The FCA also enforces the FDPA, as amended, which requires FCA to
assess CMPs for a pattern or practice of committing certain specific
actions in violation of the National Flood Insurance Program. The
existing maximum CMP for a violation under the Flood Disaster
Protection Act of 1973 is $2,000.8 9
---------------------------------------------------------------------------
\8\ Public Law 112-141, 126 Stat. 405 (July 6, 2012).
\9\ The inflation-adjusted CMP in effect on January 15, 2020,
for a flood insurance violation is $2,226, as set forth in Sec.
622.61(b)of FCA regulations.
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C. Federal Civil Penalties Inflation Adjustment Act Improvements Act of
2015
1. In General
The 2015 Act required all Federal agencies to adjust the CMPs
yearly, starting January 15, 2017.
Under Section 4(b) of the 1990 Act, as amended, annual adjustments
are to be made yearly no later than January 15 of
[[Page 7236]]
each year.\10\ Section 6 of the 1990 Act, as amended, states that any
increase to a civil monetary penalty under this 1990 Act applies only
to civil monetary penalties, including those whose associated violation
predated such increase, which are assessed after the date the increase
takes effect.
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\10\ Public Law 114-74, sec. 701(b)(1).
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Section 5(b) of the 1990 Act, as amended, defines the term ``cost-
of-living adjustment'' as the percentage (if any) for each civil
monetary penalty by which (1) the Consumer Price Index (CPI) for the
month of October of the calendar year preceding the adjustment, exceeds
(2) the CPI for the month of October 1 year before the month of October
referred to in (1) of the calendar year in which the amount of such
civil monetary penalty was last set or adjusted pursuant to law.\11\
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\11\ The CPI is published by the Department of Labor, Bureau of
Statistics, and is available at its website: https://www.bls.gov/cpi/.
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The increase for each CMP adjusted for inflation must be rounded
using a method prescribed by section 5(a) of the 1990 Act, as amended,
by the 2015 Act.\12\
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\12\ Pursuant to section 5(a)(3) of the 2015 Act, any increase
determined under the subsection shall be rounded to the nearest $1.
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2. Other Adjustments
If a civil monetary penalty is subject to a cost-of-living
adjustment under the 1990 Act, as amended, but is adjusted to an amount
greater than the amount of the adjustment required under the Act within
the 12 months preceding a required cost-of-living adjustment, the
agency is not required to make the cost-of-living adjustment to that
CMP in that calendar year.\13\
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\13\ Pursuant to section 4(d) of the 1990 Act, as amended.
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III. Yearly Adjustments
A. Mathematical Calculations of 2021 Adjustments
The adjustment requirement affects two provisions of section
5.32(a) of the Farm Credit Act. For the 2021 yearly adjustments to the
CMPs set forth by the Farm Credit Act, the calculation required by the
2020 White House Office of Management and Budget (OMB) guidance \14\ is
based on the percentage by which the CPI for October 2020 exceeds the
CPIs for October 2019. The OMB set forth guidance, as required by the
2015 Act,\15\ with a multiplier for calculating the new CMP values.\16\
The 2020 OMB multiplier for the 2021 CMPs is 1.01182.
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\14\ OMB Circular M-21-10, Implementation of Penalty Inflation
Adjustments for 2021, Pursuant to the Federal Civil Penalties
Inflation Adjustment Act Improvements Act of 2015.
\15\ 28 U.S.C. 2461 note, section 7(a).
\16\ OMB Circular M-21-10, Implementation of Penalty Inflation
Adjustments for 2021, Pursuant to the Federal Civil Penalties
Inflation Adjustment Act Improvements Act of 2015.
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The adjustment also affects the CMPs set by the Flood Disaster
Protection Act of 1973, as amended. The adjustment multiplier is the
same for all FCA enforced CMPs, set at 1.01182. The maximum CMPs for
violations were created in 2012 by the Biggert-Waters Act, which
amended the Flood Disaster Protection Act of 1973.
1. New Penalty Amount in Sec. 622.61(a)(1)
The inflation-adjusted CMP currently in effect for violations of a
final order occurring on or after January 15, 2020, is a maximum daily
amount of $2,367.\17\ Multiplying the $2,367 CMP by the 2020 OMB
multiplier, 1.01182, yields a total of $2,394.98. When that number is
rounded as required by section 5(a) of the 1990 Act, as amended, the
inflation-adjusted maximum increases to $2,395. Thus, the new CMP
maximum is $2,395, for violations that occur on or after January 15,
2021.
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\17\ 12 CFR 622.61(a)(1). As noted above, we discovered a
transposition error, so the correct maximum daily amount for 2020 is
$2,367. Accordingly, we use the corrected amount to compute the
maximum amount for CMP violations that occur on or after January 15,
2021.
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2. New Penalty Amount in Sec. 622.61(a)(2)
The inflation-adjusted CMP currently in effect for violations of
the Farm Credit Act or regulations issued under the Farm Credit Act
occurring on or after January 15, 2020, is a maximum daily amount of
$1,071.\18\ Multiplying the $1,071 CMP maximum by the 2020 OMB
multiplier, 1.01182, yields a total of $1,083.66. When that number is
rounded as required by section 5(a) of the 1990 Act, as amended the
inflation-adjusted maximum increases to $1,084. Thus, the new CMP
maximum is $1,084, for violations that occur on or after January 15,
2021.
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\18\ 12 CFR 622.61(a)(2).
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3. New Penalty Amounts for Flood Insurance Violations Under Sec.
622.61(b)
The existing maximum CMP for a pattern or practice of flood
insurance violations pursuant to 42 U.S.C. 4012a(f)(5) occurring on or
after January 15, 2020, is $2,226. Multiplying $2,226 by the 2020 OMB
multiplier, 1.01182, yields a total of $2,252.31. When that number is
rounded as required by section 5(a) of the 1990 Act, as amended, the
new maximum assessment of the CMP for violating 42 U.S.C. 4012a(f)(5)
is $2,252. Thus, the new CMP maximum is $2,252, for violations that
occur on or after January 15, 2021.
IV. Notice and Comment Not Required by Administrative Procedure Act
The 1990 Act, as amended, gives Federal agencies no discretion in
the adjustment of CMPs for the rate of inflation. Further, these
revisions are ministerial, technical, and noncontroversial. For these
reasons, the FCA finds good cause to determine that public notice and
an opportunity to comment are impracticable, unnecessary, and contrary
to the public interest pursuant to the Administrative Procedure Act, 5
U.S.C. 553(b)(B), and adopts this rule in final form.
V. Regulatory Flexibility Act
Pursuant to section 605(b) of the Regulatory Flexibility Act (5
U.S.C. 601 et seq.), the FCA hereby certifies that this final rule will
not have a significant economic impact on a substantial number of small
entities. Each of the banks in the System, considered together with its
affiliated associations, has assets and annual income in excess of the
amounts that would qualify them as small entities. Therefore, System
institutions are not ``small entities'' as defined in the Regulatory
Flexibility Act.
List of Subjects in 12 CFR Part 622
Administrative practice and procedure, Crime, Investigations,
Penalties.
For the reasons stated in the preamble, part 622 of chapter VI,
title 12 of the Code of Federal Regulations is amended as follows:
PART 622--RULES OF PRACTICE AND PROCEDURE
0
1. The authority citation for part 622 continues to read as follows:
Authority: Secs. 5.9, 5.10, 5.17, 5.25-5.37 of the Farm Credit
Act (12 U.S.C. 2243, 2244, 2252, 2261-2273); 28 U.S.C. 2461 note;
and 42 U.S.C. 4012a(f).
0
2. Revise Sec. 622.61 to read as follows:
Sec. 622.61 Adjustment of civil money penalties by the rate of
inflation under the Federal Civil Penalties Inflation Adjustment Act of
1990, as amended.
(a) The maximum amount of each civil money penalty within FCA's
jurisdiction is adjusted in accordance with the Federal Civil Penalties
Inflation Adjustment Act of 1990, as amended (28 U.S.C. 2461 note), as
follows:
(1) Amount of civil money penalty imposed under section 5.32 of the
Act
[[Page 7237]]
for violation of a final order issued under section 5.25 or 5.26 of the
Act: The maximum daily amount is $2,395 for violations that occur on or
after January 15, 2021.
(2) Amount of civil money penalty for violation of the Act or
regulations: The maximum daily amount is $1,084 for each violation that
occurs on or after January 15, 2021.
(b) The maximum civil money penalty amount assessed under 42 U.S.C.
4012a(f) is $2,252 for each violation that occurs on or after January
15, 2021, with no cap on the total amount of penalties that can be
assessed against any single institution during any calendar year.
Dated: January 22, 2021.
Dale Aultman,
Secretary, Farm Credit Administration Board.
[FR Doc. 2021-01796 Filed 1-26-21; 8:45 am]
BILLING CODE 6705-01-P
