82 FR 6248 - Civil Monetary Penalty Inflation Adjustment

DEPARTMENT OF DEFENSE
Office of the Secretary

Federal Register Volume 82, Issue 12 (January 19, 2017)

This final rule is being issued to adjust for inflation each civil monetary penalty (CMP) provided by law within the jurisdiction of the United States Department of Defense (Department of Defense). The Federal Civil Penalties Inflation Adjustment Act of 1990, as amended by the Debt Collection Improvement Act of 1996 and the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015 (the 2015 Act), requires the head of each agency to adjust for inflation its CMP levels in effect as of November 2, 2015, under a revised methodology that was effective for 2016 and for each year thereafter.

[Federal Register Volume 82, Number 12 (Thursday, January 19, 2017)]
[Rules and Regulations]
[Pages 6248-6250]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2017-00619]


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DEPARTMENT OF DEFENSE

Office of the Secretary

32 CFR Part 269

[Docket ID: DOD-2016-OS-0045]
RIN 0790-ZA12


Civil Monetary Penalty Inflation Adjustment

AGENCY: Under Secretary of Defense (Comptroller), Department of 
Defense.

ACTION: Final rule.

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SUMMARY: This final rule is being issued to adjust for inflation each 
civil monetary penalty (CMP) provided by law within the jurisdiction of 
the United States Department of Defense (Department of Defense). The 
Federal Civil Penalties Inflation Adjustment Act of 1990, as amended by 
the Debt Collection Improvement Act of 1996 and the Federal Civil 
Penalties Inflation Adjustment Act Improvements Act of 2015 (the 2015 
Act), requires the head of each agency to adjust for inflation its CMP 
levels in effect as of November 2, 2015, under a revised methodology 
that was effective for 2016 and for each year thereafter.

DATES: This rule is effective January 19, 2017 and is applicable 
beginning on January 13, 2017.

FOR FURTHER INFORMATION CONTACT: Brian Banal, 703-571-1652.

SUPPLEMENTARY INFORMATION:

Background Information

    The Federal Civil Penalties Inflation Adjustment Act of 1990, 
Public Law 101-410, 104 Stat. 890 (28 U.S.C. 2461, note), as amended by 
the Debt Collection Improvement Act of 1996, Public Law 104-134, April 
26, 1996, and further amended by the Federal Civil Penalties Inflation 
Adjustment Act Improvements Act of 2015 (the 2015 Act), Public Law 114-
74, November 2, 2015, required agencies to annually adjust the level of 
CMPs for inflation to improve their effectiveness and maintain their 
deterrent effect. The 2015 Act required that not later than July 1, 
2016, and not later than January 15 of every year thereafter, the head 
of each agency must adjust each CMP within its jurisdiction by the 
inflation adjustment described in the 2015 Act. The inflation 
adjustment is determined by increasing the maximum CMP or the range of 
minimum and maximum CMPs, as applicable, for each CMP by the cost-of-
living adjustment, rounded to the nearest multiple of $1. The cost-of-
living adjustment is the percentage (if any) for each CMP by which the 
Consumer Price Index (CPI) for the month of October preceding the date 
of the adjustment (January 15), exceeds the CPI for the month of 
October in the previous calendar year.
    The initial catch up adjustments for inflation to the Department of 
Defense's CMPs were published as an interim final rule in the Federal 
Register on May 26, 2016 (81 FR 33389-33391) and became effective on 
that date. The interim final rule was published as a final rule without 
change on September 12, 2016 (81 FR 62629-62631), effective that date. 
The revised methodology for agencies for 2017 and each year thereafter 
provides for the improvement of the effectiveness of CMPs and to 
maintain their deterrent effect. Effective 2017, agencies' annual 
adjustments for inflation to CMPs shall take effect not later than 
January 15. The Department of Defense is adjusting the level of all 
civil monetary penalties under its jurisdiction by the Office of 
Management and Budget (OMB) directed cost-of-living adjustment 
multiplier for 2017 of 1.01636 prescribed in OMB Memorandum M-17-11, 
``Implementation of the 2017

[[Page 6249]]

annual adjustment pursuant to the Federal Civil Penalties Inflation 
Adjustment Act Improvements Act of 2015,'' dated December 16, 2016. The 
Department of Defense's 2017 adjustments for inflation to CMPs apply 
only to those CMPs, including those whose associated violation predated 
such adjustment, which are assessed by the Department of Defense after 
the effective date of the new CMP level.

Statement of Authority and Costs and Benefits

    Pursuant to 5 U.S.C. 553(b)B, there is good cause to issue this 
rule without prior public notice or opportunity for public comment 
because it would be impracticable and unnecessary. The Federal Civil 
Penalties Inflation Adjustment Act Improvements Act of 2015 (Section 
701(b)) requires agencies, effective 2017, to make annual adjustments 
for inflation to CMPs notwithstanding section 553 of title 5, United 
States Code. Additionally, the methodology used, effective 2017, for 
adjusting CMPs for inflation is established in statute, with no 
discretion provided to agencies regarding the substance of the 
adjustments for inflation to CMPs. The Department of Defense is charged 
only with performing ministerial computations to determine the dollar 
amount of adjustments for inflation to CMPs.
    Further, there are no significant costs associated with the 
regulatory revisions that would impose any mandates on the Department 
of Defense, Federal, State or local governments, or the private sector. 
Accordingly, prior public notice and an opportunity for public comment 
are not required for this rule. The benefit of this rule is the 
Department of Defense anticipates that civil monetary penalty 
collections may increase in the future due to new penalty authorities 
and other changes in this rule. However, it is difficult to accurately 
predict the extent of any increase, if any, due to a variety of 
factors, such as budget and staff resources, the number and quality of 
civil penalty referrals or leads, and the length of time needed to 
investigate and resolve a case.

Regulatory Procedures

Executive Order 12866, ``Regulatory Planning and Review'' and Executive 
Order 13563, ``Improving Regulation and Regulatory Review''

    Executive Orders 13563 and 12866 direct agencies to assess all 
costs and benefits of available regulatory alternatives and, if 
regulation is necessary, to select regulatory approaches that maximize 
net benefits (including potential economic, environmental, public 
health and safety effects, distribute impacts, and equity). Executive 
Order 13563 emphasizes the importance of quantifying both costs and 
benefits, of reducing costs, of harmonizing rules, and of promoting 
flexibility. This rule has not been designated a ``significant 
regulatory action,'' because it does not: (1) Have an annual effect on 
the economy of $100 million or more or adversely affect in a material 
way the economy; a section of the economy; productivity; competition; 
jobs; the environment; public health or safety; or State, local, or 
tribal governments or communities; (2) create a serious inconsistency 
or otherwise interfere with an action taken or planned by another 
Agency; (3) materially alter the budgetary impact of entitlements, 
grants, user fees, or loan programs, or the rights and obligations of 
recipients thereof; or (4) raise novel legal or policy issues arising 
out of legal mandates, the President's priorities, or the principles 
set forth in these Executive Orders.

Unfunded Mandates Reform Act (2 U.S.C. Chapter 25)

    Section 202 of the Unfunded Mandates Reform Act of 1995 (UMRA) (2 
U.S.C. 1532) requires agencies to assess anticipated costs and benefits 
before issuing any rule the mandates of which require spending in any 
year of $100 million in 1995 dollars, updated annually for inflation. 
In 2016, that threshold is approximately $146 million. This rule will 
not mandate any requirements for State, local, or tribal governments, 
nor will it affect private sector costs.

Public Law 96-354, ``Regulatory Flexibility Act'' (5 U.S.C. Chapter 6)

    Because notice of proposed rulemaking and opportunity for comment 
are not required pursuant to 5 U.S.C. 553, or any other law, the 
analytical requirements of the Regulatory Flexibility Act (5 U.S.C. 
601, et seq.) are inapplicable. Therefore, a regulatory flexibility 
analysis is not required and has not been prepared.

Public Law 96-511, ``Paperwork Reduction Act'' (44 U.S.C. Chapter 35)

    The Department of Defense determined that provisions of the 
Paperwork Reduction Act of 1995, Public Law 104-13, 44 U.S.C. Chapter 
35, and its implementing regulations, 5 CFR part 1320, do not apply to 
this rule because there are no new or revised recordkeeping or 
reporting requirements.

Executive Order 13132, ``Federalism''

    Executive Order 13132 establishes certain requirements that an 
agency must meet when it promulgates a rule that imposes substantial 
direct requirement costs on State and local governments, preempts State 
law, or otherwise has Federalism implications. This final rule will not 
have a substantial effect on State and local governments.

List of Subjects in 32 CFR Part 269

    Administrative practice and procedure, Penalties.

    Accordingly, 32 CFR part 269 is amended as follows.

PART 269--[AMENDED]

0
1. The authority citation for 32 CFR part 269 continues to read as 
follows:

    Authority: 28 U.S.C. 2461 note.

0
2. Revise Sec.  269.4(d) to read as follows:


Sec.  269.4  Cost of living adjustments of civil monetary penalties.

* * * * *
    (d) Inflation adjustment. Maximum civil monetary penalties within 
the jurisdiction of the Department are adjusted for inflation as 
follows:

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                                                                                      Maximum      New Adjusted
              United States Code                     Civil Monetary Penalty       Penalty Amount      Maximum
                                                           Description            as of 05/26/16  Penalty Amount
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National Defense Authorization Act for FY       Unauthorized Activities Directed        $124,588         126,626
 2005, 10 U.S.C 113, note.                       at or Possession of Sunken
                                                 Military Craft.
10 U.S.C. 1094(c)(1)..........................  Unlawful Provision of Health              10,940          11,119
                                                 Care.
10 U.S.C. 1102(k).............................  Wrongful Disclosure--Medical
                                                 Records.
                                                  First Offense                            6,469           6,575
                                                  Subsequent Offense                      43,126          43,832

[[Page 6250]]

 
10 U.S.C. 2674(c)(2)..........................  Violation of the Pentagon                  1,782           1,811
                                                 Reservation Operation and
                                                 Parking of Motor Vehicles Rules
                                                 and Regulations.
31 U.S.C. 3802(a)(1)..........................  Violation Involving False Claim.          10,781          10,957
31 U.S.C. 3802(a)(2)..........................  Violation Involving False                 10,781          10,957
                                                 Statement.
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    Dated: January 9, 2017.
Aaron Siegel,
Alternate OSD Federal Register Liaison Officer, Department of Defense.
[FR Doc. 2017-00619 Filed 1-18-17; 8:45 am]
 BILLING CODE 5001-06-P