81 FR 43019 - Adjustment of Civil Penalties for Inflation

NUCLEAR REGULATORY COMMISSION

Federal Register Volume 81, Issue 127 (July 1, 2016)

The U.S. Nuclear Regulatory Commission (NRC) is amending its regulations to adjust the maximum Civil Monetary Penalties (CMPs) it can assess under statutes enforced by the agency. These changes are mandated by the Federal Civil Penalties Inflation Adjustment Act of 1990 (FCPIAA), as amended by the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015 (2015 Improvements Act). The NRC is amending its regulations to adjust the maximum CMP for a violation of the Atomic Energy Act of 1954, as amended (AEA), or any regulation or order issued under the AEA from $140,000 to $280,469 per violation, per day. Additionally, the NRC is amending provisions concerning program fraud civil penalties by adjusting the maximum CMP under the Program Fraud Civil Remedies Act from $7,000 to $10,781 for each false claim or statement.

[Federal Register Volume 81, Number 127 (Friday, July 1, 2016)]
[Rules and Regulations]
[Pages 43019-43021]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2016-15399]


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NUCLEAR REGULATORY COMMISSION

10 CFR Parts 2 and 13

[NRC-2016-0057]
RIN 3150-AJ72


Adjustment of Civil Penalties for Inflation

AGENCY: Nuclear Regulatory Commission.

ACTION: Interim final rule.

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SUMMARY: The U.S. Nuclear Regulatory Commission (NRC) is amending its 
regulations to adjust the maximum Civil Monetary Penalties (CMPs) it 
can assess under statutes enforced by the agency. These changes are 
mandated by the Federal Civil Penalties Inflation Adjustment Act of 
1990 (FCPIAA), as amended by the Federal Civil Penalties Inflation 
Adjustment Act Improvements Act of 2015 (2015 Improvements Act). The 
NRC is amending its regulations to adjust the maximum CMP for a 
violation of the Atomic Energy Act of 1954, as amended (AEA), or any 
regulation or order issued under the AEA from $140,000 to $280,469 per 
violation, per day. Additionally, the NRC is amending provisions 
concerning program fraud civil penalties by adjusting the maximum CMP 
under the Program Fraud Civil Remedies Act from $7,000 to $10,781 for 
each false claim or statement.

DATES: This interim final rule is effective on August 1, 2016.

ADDRESSES: Please refer to Docket ID NRC-2016-0057 when contacting the 
NRC about the availability of information for this action. You may 
obtain publicly-available information related to this action by any of 
the following methods:
     Federal Rulemaking Web site: Go to http://www.regulations.gov and search for Docket ID NRC-2016-0057. Address 
questions about NRC dockets to Carol Gallagher; telephone: 301-415-
3463; email: [email protected]. For technical questions, contact 
the individual listed in the FOR FURTHER INFORMATION CONTACT section of 
this document.
     NRC's Agencywide Documents Access and Management System 
(ADAMS): You may obtain publicly-available documents online in the 
ADAMS Public Documents collection at http://www.nrc.gov/reading-rm/adams.html. To begin the search, select ``ADAMS Public Documents'' and 
then select ``Begin Web-based ADAMS Search.'' For problems with ADAMS, 
please contact the NRC's Public Document Room (PDR) reference staff at 
1-800-397-4209, 301-415-4737, or by email to [email protected]. The 
ADAMS accession number for each document referenced (if it is available 
in ADAMS) is provided the first time that it is mentioned in the 
SUPPLEMENTARY INFORMATION section.
     NRC's PDR: You may examine and purchase copies of public 
documents at the NRC's PDR, Room O1-F21, One White Flint North, 11555 
Rockville Pike, Rockville, Maryland 20852.

FOR FURTHER INFORMATION CONTACT: Eric Michel, Office of the General 
Counsel, telephone: 301-287-3704, email: [email protected], U.S. 
Nuclear Regulatory Commission, Washington, DC 20555-0001.

SUPPLEMENTARY INFORMATION:

Table of Contents

I. Background
II. Discussion
III. Procedural Background
IV. Section-by-Section Analysis
V. Regulatory Flexibility Certification
VI. Regulatory Analysis
VII. Backfitting and Issue Finality
VIII. Plain Writing
IX. National Environmental Policy Act
X. Paperwork Reduction Act
XI. Congressional Review Act

I. Background

    Congress passed the FCPIAA in 1990 to allow for regular adjustment 
for inflation of CMPs, maintain the deterrent effect of civil monetary 
penalties and promote compliance with the law, and improve the 
collection of CMPs by the Federal government (Pub. L. 101-410, 104 
Stat. 890; 28 U.S.C. 2461 note). As amended by the Debt Collection 
Improvement Act of 1996, the FCPIAA required that the head of each 
agency review, and if necessary adjust by regulation, the CMPs assessed 
under statutes enforced by that agency at least once every 4 years, in 
accordance with a statutory formula linked to the percentage change in 
the Consumer Price Index (CPI) (Pub. L. 104-134, 110 Stat. 1321-373). 
The NRC has amended the CMP amounts under statutes it enforces (the AEA 
and Program Fraud Civil Remedies Act) four times, most recently in 2008 
(September 23, 2008; 73 FR 54671). An adjustment was not performed in 
2012 because the FCPIAA required agencies to round their CMP amounts to 
the nearest multiple of $1,000 or $10,000, depending on the size of the 
CMP amount, and the 2012 adjustments based on the statutory formula 
were small enough that no adjustment resulted.
    On November 2, 2015, the FCPIAA was amended by the 2015 
Improvements Act (Sec. 701, Pub. L. 114-74, 129 Stat. 599). The 2015 
Improvements Act requires that the head of each agency through an 
interim final rulemaking make an initial ``catch-up'' adjustment of the 
CMPs assessed under statutes enforced by that agency by July 1, 2016, 
to be effective no later than August 1, 2016. This initial catch-up 
adjustment is to be calculated according to the percentage change 
between the CPI for the month of October 2015 and the CPI for the month 
of October of the calendar year when the CMP amount was last 
established by some means other than a FCPIAA adjustment. The increase 
for the initial catch up adjustment may not exceed 150 percent of the 
CMP amount as of the date of the enactment of the 2015 Improvements 
Act. Following the initial catch-up adjustment, agencies must continue 
to adjust their CMPs by January 15 of each year. This calculation is 
based on the percentage change between the CPI for the preceding month 
of October and the CPI for the month of October in the preceding year. 
All increases under the 2015 Improvements Act are to be rounded to the 
nearest multiple of one dollar.

II. Discussion

    Section 234 of the AEA limits civil penalties for violations of the 
AEA to $100,000 per day, per violation (42 U.S.C. 2282). Congress 
established the $100,000 amount in 1980 (Pub. L. 96-295, 94 Stat. 787). 
As discussed in Section I, ``Background,'' of this

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document, the NRC has adjusted this amount (currently set at $140,000) 
on four occasions since 1980, each time pursuant to the FCPIAA. For 
purposes of calculating the initial catch-up adjustment under the 2015 
Improvements Act, the relevant baseline year for AEA CMPs is 1980 (the 
last time the CMP was established by some means other than a FCPIAA 
adjustment). Using the formula in the 2015 Improvements Act, the 
$100,000 amount established in 1980 will increase by 280.469 percent, 
resulting in a new CMP figure of $280,469.\1\ The 2015 Improvements Act 
caps the increase in penalty levels for the initial catch-up adjustment 
at no more than 150 percent of the CMP level in effect as of November 
2, 2015, which means the amount of increase for AEA CMPs cannot exceed 
$210,000 (150 percent of the current $140,000 amount). A new CMP amount 
of $280,469 is an increase of $140,469, which is within the limit 
imposed by the 2015 Improvements Act. Therefore, the NRC is amending 
Sec.  2.205 of title 10 of the Code of Federal Regulations (10 CFR) to 
reflect a new maximum CMP under the AEA in the amount of $280,469 per 
day, per violation.
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    \1\ This figure is confirmed by guidance from the Office of 
Management and Budget (OMB) concerning implementation of the 2015 
Improvements Act. See OMB M-16-06, Implementation of the Federal 
Civil Penalties Inflation Adjustment Act Improvements Act of 2015 
(Feb. 24, 2016), available at https://www.whitehouse.gov/sites/default/files/omb/memoranda/2016/m-16-06.pdf.
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    Monetary penalties under the Program Fraud Civil Remedies Act were 
established in 1986 at $5,000 per claim (Pub. L. 99-509, 100 Stat. 
1938; 31 U.S.C. 3802). The NRC has adjusted this amount (currently set 
at $7,000) multiple times pursuant to the FCPIAA since 1986. Using 1986 
as the baseline year, the $5,000 amount will increase by 215.628 
percent, resulting in a new CMP amount of $10,781. This is a $3,781 
increase from the current $7,000 CMP amount, which is less than the 
statutory cap of a $10,500 increase (150 percent of $7,000). Therefore, 
the NRC is amending 10 CFR 13.3 to reflect a new maximum CMP amount of 
$10,781 per claim.
    As permitted by the 2015 Improvements Act, the NRC may apply these 
increased CMP amounts to any penalties assessed by the agency after the 
effective date of this interim final rule (August 1, 2016), regardless 
of whether the associated violation occurred before or after this date 
(Pub. L. 114-74, 129 Stat. 600; 28 U.S.C. 2461 note). Conforming 
changes to the NRC Enforcement Policy (ADAMS Accession No. ML15029A148) 
will be published in a forthcoming Federal Register notice before the 
effective date of this interim final rule (August 1, 2016).

III. Procedural Background

    This interim final rule has been issued without prior public notice 
or opportunity for public comments. The Administrative Procedure Act (5 
U.S.C. 553(b)(B)) does not require an agency to use the public notice 
and comment process ``when the agency for good cause finds (and 
incorporates the finding and a brief statement of reasons therefore in 
the rules issued) that notice and public procedure thereon are 
impracticable, unnecessary, or contrary to the public interest.'' In 
this instance, the NRC finds, for good cause, that solicitation of 
public comment on this interim final rule is unnecessary. Through the 
FCPIAA and 2015 Improvements Act, Congress has provided a non-
discretionary statutory formula by which the NRC must adjust its CMPs 
for inflation. Requesting public comment on these CMP adjustments, 
which are required by statute, would not result in a different amount.

IV. Section-by-Section Analysis

    Paragraph (j) in Sec.  2.205 is revised by replacing ``$140,000'' 
with ``$280,469''.
    Paragraphs (a)(1)(iv) and (b)(1)(ii) in Sec.  13.3 are revised by 
replacing ``$7,000'' with ``$10,781''.

V. Regulatory Flexibility Certification

    Under the Regulatory Flexibility Act (5 U.S.C. 605(b)), the NRC 
certifies that this interim final rule will not have a significant 
economic impact on a substantial number of small entities.

VI. Regulatory Analysis

    This interim final rule adjusts for inflation the maximum CMPs the 
NRC may assess under the AEA and under the Program Fraud Civil Remedies 
Act of 1986. The formula for determining the amount of the adjustment 
is mandated by Congress in the FCPIAA, as amended by the 2015 
Improvements Act (28 U.S.C. 2461 note). Congress passed this 
legislation on the basis of its findings that the power to impose 
monetary civil penalties is important to deterring violations of 
Federal law and furthering the policy goals of Federal laws and 
regulations. Congress has also found that inflation has diminished the 
impact of these penalties and their effect. The principal purposes of 
this legislation are to provide for adjustment of civil monetary 
penalties for inflation, maintain the deterrent effect of civil 
monetary penalties, and promote compliance with the law. Therefore, 
these are the anticipated impacts of this rulemaking. Direct monetary 
impacts fall only upon licensees or other persons subjected to NRC 
enforcement for violations of the AEA and regulations and orders issued 
under the AEA (10 CFR 2.205), or those licensees or persons subjected 
to liability pursuant to the provisions of the Program Fraud Civil 
Remedies Act of 1986 (31 U.S.C. 3801-3812) and the NRC's implementing 
regulations (10 CFR part 13).

VII. Backfit and Issue Finality

    The NRC has not prepared a backfit analysis for this rulemaking. 
This interim final rule does not involve any provision that would 
impose a backfit, nor is it inconsistent with any issue finality 
provision, as those terms are defined in 10 CFR chapter I. As mandated 
by Congress, this interim final rule increases CMP amounts for 
violations of already-existing NRC regulations and requirements. This 
interim final rule does not modify any licensee system, structures, 
components, designs, approvals, or procedures required for the design, 
construction, or operation of any facility.

VIII. Plain Writing

    The Plain Writing Act of 2010 (Pub. L. 111-274) requires Federal 
agencies to write documents in a clear, concise, and well-organized 
manner. The NRC has written this document to be consistent with the 
Plain Writing Act as well as the Presidential Memorandum, ``Plain 
Language in Government Writing,'' published June 10, 1998 (63 FR 
31883).

IX. National Environmental Policy Act

    The NRC has determined that this interim final rule is the type of 
action described as a categorical exclusion in 10 CFR 51.22(c)(1) and 
(2). Therefore, neither an environmental impact statement nor an 
environmental assessment has been prepared for this interim final rule.

X. Paperwork Reduction Statement

    This interim final rule does not contain a collection of 
information as defined in the Paperwork Reduction Act of 1995 (44 
U.S.C. 3501 et seq.) and, therefore, is not subject to the requirements 
of the Paperwork Reduction Act of 1995.

XI. Congressional Review Act

    This interim final rule is a rule as defined in the Congressional 
Review Act (5 U.S.C. 801-808). However, the Office of Management and 
Budget has

[[Page 43021]]

not found it to be a major rule as defined in the Congressional Review 
Act.

List of Subjects

10 CFR Part 2

    Administrative practice and procedure, Antitrust, Byproduct 
material, Classified information, Confidential business information; 
Freedom of information, Environmental protection, Hazardous waste, 
Nuclear energy, Nuclear materials, Nuclear power plants and reactors, 
Penalties, Reporting and recordkeeping requirements, Sex 
discrimination, Source material, Special nuclear material, Waste 
treatment and disposal.

10 CFR Part 13

    Administrative practice and procedure, Claims, Fraud, Organization 
and function (Government agencies), Penalties.

    For the reasons set out in the preamble and under the authority of 
the Atomic Energy Act of 1954, as amended; the Energy Reorganization 
Act of 1974, as amended; 28 U.S.C. 2461 note; and 5 U.S.C. 552 and 553, 
the NRC is adopting the following amendments to 10 CFR parts 2 and 13.

PART 2--AGENCY RULES OF PRACTICE AND PROCEDURE

0
1. The authority citation for part 2 is revised to read as follows:

    Authority: Atomic Energy Act of 1954, secs. 29, 53, 62, 63, 81, 
102, 103, 104, 105, 161, 181, 182, 183, 184, 186, 189, 191, 234 (42 
U.S.C. 2039, 2073, 2092, 2093, 2111, 2132, 2133, 2134, 2135, 2201, 
2231, 2232, 2233, 2234, 2236, 2239, 2241, 2282); Energy 
Reorganization Act of 1974, secs. 201, 206 (42 U.S.C. 5841, 5846); 
Nuclear Waste Policy Act of 1982, secs. 114(f), 134, 135, 141 (42 
U.S.C. 10134(f), 10154, 10155, 10161); Administrative Procedure Act 
(5 U.S.C. 552, 553, 554, 557, 558); National Environmental Policy 
Act of 1969 (42 U.S.C. 4332); 44 U.S.C. 3504 note.
    Section 2.205(j) also issued under 28 U.S.C. 2461 note.


0
2. Amend Sec.  2.205 by revising paragraph (j) to read as follows:


Sec.  2.205  Civil penalties.

* * * * *
    (j) Amount. A civil monetary penalty imposed under Section 234 of 
the Atomic Energy Act of 1954, as amended, or any other statute within 
the jurisdiction of the Commission that provides for the imposition of 
a civil penalty in an amount equal to the amount set forth in Section 
234, may not exceed $280,469 for each violation. If any violation is a 
continuing one, each day of such violation shall constitute a separate 
violation for the purposes of computing the applicable civil penalty.

PART 13--PROGRAM FRAUD CIVIL REMEDIES

0
3. The authority citation for part 13 is revised to read as follows:

    Authority: 31 U.S.C. 3801 through 3812; 44 U.S.C. 3504 note.
    Section 13.3 also issued under 28 U.S.C. 2461 note.
    Section 13.13 also issued under 31 U.S.C. 3730.


0
4. Amend Sec.  13.3 by revising paragraphs (a)(1)(iv) and (b)(1)(ii) to 
read as follows:


Sec.  13.3  Basis for civil penalties and assessments.

    (a) * * *
    (1) * * *
    (iv) Is for payment for the provision of property or services which 
the person has not provided as claimed, shall be subject, in addition 
to any other remedy that may be prescribed by law, to a civil penalty 
of not more than $10,781 for each such claim.
* * * * *
    (b) * * *
    (1) * * *
    (ii) Contains or is accompanied by an express certification or 
affirmation of the truthfulness and accuracy of the contents of the 
statement, shall be subject, in addition to any other remedy that may 
be prescribed by law, to a civil penalty of not more than $10,781 for 
each such statement.
* * * * *

    Dated in Rockville, Maryland, this 20 day of June, 2016.

    For the Nuclear Regulatory Commission.
Victor M. McCree,
Executive Director for Operations.
[FR Doc. 2016-15399 Filed 6-30-16; 8:45 am]
 BILLING CODE 7590-01-P