Oil and Gas and Sulfur Operations on the Outer Continental Shelf-Civil Penalty Inflation Adjustment

Citation85 FR 12733
Published date04 March 2020
Record Number2020-03694
SectionRules and Regulations
CourtSafety And Environmental Enforcement Bureau
Federal Register, Volume 85 Issue 43 (Wednesday, March 4, 2020)
[Federal Register Volume 85, Number 43 (Wednesday, March 4, 2020)]
                [Rules and Regulations]
                [Pages 12733-12735]
                From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
                [FR Doc No: 2020-03694]
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                DEPARTMENT OF THE INTERIOR
                Bureau of Safety and Environmental Enforcement
                30 CFR Part 250
                [Docket ID: BSEE-2020-0001; EEEE500000 20XE1700DX EX1SF0000.EAQ000]
                RIN 1014-AA47
                Oil and Gas and Sulfur Operations on the Outer Continental
                Shelf--Civil Penalty Inflation Adjustment
                AGENCY: Bureau of Safety and Environmental Enforcement, Interior.
                ACTION: Final rule.
                -----------------------------------------------------------------------
                SUMMARY: This final rule adjusts the level of the maximum daily civil
                monetary penalty contained in the Bureau of Safety and Environmental
                Enforcement (BSEE) regulations for violations of the Outer Continental
                Shelf Lands Act (OCSLA), in accordance with the Federal Civil Penalties
                Inflation Adjustment Act Improvements Act of 2015 and Office of
                Management and Budget (OMB) guidance. The civil penalty inflation
                adjustment, using a 1.01764 multiplier, accounts for one year of
                inflation spanning from October 2018 to October 2019.
                DATES: This rule is effective on March 4, 2020.
                FOR FURTHER INFORMATION CONTACT: Janine Marie Tobias, Safety and
                Enforcement Division, Bureau of Safety and Environmental Enforcement,
                (202) 208-4657 or by email: [email protected].
                SUPPLEMENTARY INFORMATION:
                I. Background and Legal Authority
                 The OCSLA, at 43 U.S.C. 1350(b)(1), directs the Secretary of the
                Interior (Secretary) to adjust the OCSLA maximum daily civil penalty
                amount at least once every three years to reflect any increase in the
                Consumer Price Index (CPI) to account for inflation. On November 2,
                2015, the President signed into law the Federal Civil Penalties
                Inflation Adjustment Act Improvements Act of 2015 (Sec. 701 of Pub. L.
                114-74) (FCPIA of 2015). The FCPIA of 2015 required Federal agencies to
                adjust the level of civil monetary penalties found in their regulations
                with an initial ``catch-up'' adjustment through rulemaking, if
                warranted, and then to make subsequent annual adjustments for
                inflation. The purpose of these adjustments is to maintain the
                deterrent effect of civil penalties and to further the policy goals of
                the underlying statutes. Agencies were required to publish the first
                annual inflation adjustments in the Federal Register by no later than
                January 15, 2017 and must publish recurring annual inflation
                adjustments by no later than January 15 of each subsequent year.
                 BSEE last updated the maximum daily civil penalty amounts in BSEE's
                regulations for OCSLA violations by a final rule published and
                effective on March 25, 2019. (See 84 FR 10,989). Consistent with OMB
                guidance, BSEE's final rule implemented the inflation adjustments
                required by the FCPIA of 2015 through October 2018.
                 The OMB Memorandum M-20-05 (Implementation of Penalty Inflation
                Adjustments for 2020, Pursuant to the Federal Civil Penalties Inflation
                Adjustment Act Improvements Act of 2015; available at https://www.whitehouse.gov/wp-content/uploads/2019/12/M-20-05.pdf) explains
                agency responsibilities for: Identifying applicable penalties and
                performing the annual adjustment; publishing revisions to regulations
                to implement the adjustment in the Federal Register; applying adjusted
                penalty levels; and performing agency oversight of inflation
                adjustments.
                 BSEE is promulgating this 2020 inflation adjustment for the OCSLA
                maximum daily civil penalties as a final rule pursuant to the
                provisions of the FCPIA of 2015 and OMB's guidance. A proposed rule is
                not required because the FCPIA of 2015 expressly exempted the annual
                inflation adjustments implemented pursuant to the FCPIA of 2015 from
                the pre-promulgation notice and comment requirements of the
                Administrative Procedure Act, 5 U.S.C. 553 et seq. (the APA), allowing
                those adjustments to be published directly as final rules.
                Specifically, the FCPIA of 2015 states that agencies shall adjust civil
                monetary penalties ``notwithstanding Section 553 of the Administrative
                Procedure Act.'' (FCPIA of 2015 at section 4(b)(2)). This
                interpretation of the FCPIA of 2015 is confirmed by OMB Memorandum M-
                20-05 at 4 (``This means that the public procedure the APA generally
                requires--notice, an opportunity for comment, and a delay in effective
                date-is not required for agencies to issue regulations implementing the
                annual adjustment.'').
                II. Calculation of Adjustments
                 In accordance with the FCPIA of 2015 and the guidance provided in
                OMB Memorandum M-20-05, BSEE has calculated the necessary inflation
                adjustment for the maximum daily civil monetary penalty amount in 30
                CFR 250.1403 for violations of OCSLA. The previous OCSLA civil penalty
                inflation adjustment accounted for inflation through October 2018. The
                required annual civil penalty inflation adjustment promulgated through
                this rule accounts for inflation through October 2019.
                 Annual inflation adjustments are based on the percent change
                between the Consumer Price Index for all Urban Consumers (CPI-U) for
                the October preceding the date of the adjustment, and the prior year's
                October CPI-U. Consistent with the guidance in OMB Memorandum M-20-05,
                BSEE divided the October 2019 CPI-U by the October 2018 CPI-U to
                calculate the multiplying factor. In this case, the October 2019 CPI-U
                (257.346) divided by the October 2018 CPI-U (252.885) is 1.01764. OMB
                Memorandum M-20-05 confirms that this is the proper multiplier. (OMB
                Memorandum M-20-05 at 1, n.4).
                 The FCPIA of 2015 requires that BSEE adjust the OCSLA maximum daily
                civil penalty amount for inflation using the applicable 2020 multiplier
                (1.01764). Accordingly, BSEE multiplied the existing OCSLA maximum
                daily civil penalty amount ($44,675) by 1.01764 to arrive at the new
                maximum daily civil penalty amount ($45,463.07). The FCPIA of 2015
                requires that the resulting amount be rounded to the nearest $1.00 at
                the end of the calculation process. Accordingly, the adjusted OCSLA
                maximum daily civil penalty for 2020 is $45,463.
                 The adjusted penalty levels take effect immediately upon
                publication of this rule. Pursuant to the FCPIA of 2015, the increase
                in the OCSLA maximum daily civil penalty amount applies to civil
                penalties assessed after the date the increase takes effect, even when
                the associated violation(s) predates such increase. Consistent with the
                provisions of OCSLA and the FCPIA of 2015, this rule adjusts the
                following maximum civil monetary penalty per day per violation as
                follows:
                [[Page 12734]]
                ----------------------------------------------------------------------------------------------------------------
                 Current Adjusted
                 CFR citation Description of the maximum Multiplier maximum
                 penalty penalty penalty
                ----------------------------------------------------------------------------------------------------------------
                30 CFR 250.1403....................... Failure to comply per- $44,675 1.01764 $45,463
                 day, per-violation.
                ----------------------------------------------------------------------------------------------------------------
                III. Procedural Requirements
                A. Regulatory Planning and Review (E.O. 12866, 13563, and 13771)
                 Executive Order (E.O.) 12866 provides that the OMB Office of
                Information and Regulatory Affairs (OIRA) will review all significant
                rules. OIRA has determined that this rule is not significant. (See OMB
                Memorandum M-20-05 at 3).
                 E.O. 13563 reaffirms the principles of E.O. 12866 while calling for
                improvements in the Nation's regulatory system to promote
                predictability, to reduce uncertainty, and to use the best, most
                innovative, and least burdensome tools for achieving regulatory ends.
                E.O. 13563 directs agencies to consider regulatory approaches that
                reduce burdens and maintain flexibility and freedom of choice for the
                public where these approaches are relevant, feasible, and consistent
                with regulatory objectives. E.O. 13563 further emphasizes that
                regulations must be based on the best available science and that the
                rulemaking process must allow for public participation and an open
                exchange of ideas. We have developed this rule in a manner consistent
                with these requirements, to the extent permitted by statute.
                 E.O. 13771 of January 30, 2017, directs Federal agencies to reduce
                the regulatory burden on regulated entities and control regulatory
                costs. E.O. 13771, however, applies only to significant regulatory
                actions, as defined in Section 3(f) of E.O. 12866. OIRA has determined
                that agency regulations implementing the annual adjustment required by
                the FCPIA of 2015 are not significant regulatory actions under E.O.
                12866, provided they are consistent with OMB Memorandum M-20-05. (See
                OMB Memorandum M-20-05 at 3). Thus, E.O. 13771 does not apply to this
                rulemaking.
                B. Regulatory Flexibility Act
                 The Regulatory Flexibility Act (RFA) requires an agency to prepare
                a regulatory flexibility analysis for rules unless the agency certifies
                that the rule will not have a significant economic impact on a
                substantial number of small entities. The RFA applies only to rules for
                which an agency is required to first publish a proposed rule. (See 5
                U.S.C. 603(a) and 604(a)). The FCPIA of 2015 expressly exempts these
                annual inflation adjustments from the requirement to publish a proposed
                rule for notice and comment. (See FCPIA of 2015 at Sec. 4(b)(2); OMB
                Memorandum M-20-05 at 4). Thus, the RFA does not apply to this
                rulemaking.
                C. Small Business Regulatory Enforcement Fairness Act
                 This rule is not a major rule under 5 U.S.C. 804(2), the Small
                Business Regulatory Enforcement Fairness Act. This rule:
                 (1) Does not have an annual effect on the economy of $100 million
                or more;
                 (2) Will not cause a major increase in costs or prices for
                consumers, individual industries, Federal, State, or local government
                agencies, or geographic regions; and
                 (3) Does not have significant adverse effects on competition,
                employment, investment, productivity, innovation, or the ability of
                U.S.-based enterprises to compete with foreign-based enterprises.
                D. Unfunded Mandates Reform Act
                 This rule does not impose an unfunded mandate on State, local, or
                tribal governments, or the private sector of more than $100 million per
                year. The rule does not have a significant or unique effect on State,
                local, or tribal governments or the private sector. Therefore, a
                statement containing the information required by the Unfunded Mandates
                Reform Act (2 U.S.C. 1531 et seq.) is not required.
                E. Takings (E.O. 12630)
                 This rule does not effect a taking of private property or otherwise
                have takings implications under E.O. 12630. Therefore, a takings
                implication assessment is not required.
                F. Federalism (E.O. 13132)
                 Under the criteria in section 1 of E.O. 13132, this rule does not
                have sufficient federalism implications to warrant the preparation of a
                federalism summary impact statement. To the extent that State and local
                governments have a role in Outer Continental Shelf activities, this
                rule will not affect that role. Therefore, a federalism summary impact
                statement is not required.
                G. Civil Justice Reform (E.O. 12988)
                 This rule complies with the requirements of E.O. 12988.
                Specifically, this rule:
                 (1) Meets the criteria of section 3(a) requiring that all
                regulations be reviewed to eliminate errors and ambiguity and be
                written to minimize litigation; and
                 (2) Meets the criteria of section 3(b)(2) requiring that all
                regulations be written in clear language and contain clear legal
                standards.
                H. Consultation With Indian Tribes (E.O. 13175 and Departmental Policy)
                 The Department of the Interior strives to strengthen its
                government-to-government relationship with Indian tribes through a
                commitment to consultation with Indian tribes and recognition of their
                right to self-governance and tribal sovereignty. We have evaluated this
                rule under the Department of the Interior's consultation policy, under
                Departmental Manual Part 512 Chapters 4 and 5, and under the criteria
                in E.O. 13175. We have determined that it has no substantial direct
                effects on Federally-recognized Indian tribes or Alaska Native Claims
                Settlement Act (ANCSA) Corporations, and that consultation under the
                Department of the Interior's tribal and ANCSA consultation policies is
                not required.
                I. Paperwork Reduction Act
                 This rule does not contain information collection requirements, and
                a submission to the OMB under the Paperwork Reduction Act (44 U.S.C.
                3501 et seq.) is not required.
                J. National Environmental Policy Act
                 This rule does not constitute a major Federal action significantly
                affecting the quality of the human environment. A detailed statement
                under the National Environmental Policy Act of 1969 (NEPA) is not
                required because, as a regulation of an administrative nature, this
                rule is covered by a categorical exclusion (see 43 CFR 46.210(i)). BSEE
                also determined that the rule does not implicate any of the
                extraordinary circumstances listed in 43 CFR 46.215 that would require
                further analysis under NEPA. Therefore, a detailed statement under NEPA
                is not required.
                K. Effects on the Energy Supply (E.O. 13211)
                 This rule is not a significant energy action under the definition
                in E.O.
                [[Page 12735]]
                13211. Therefore, a Statement of Energy Effects is not required.
                List of Subjects in 30 CFR Part 250
                 Administrative practice and procedure, Continental shelf,
                Environmental impact statements, Environmental protection, Government
                contracts, Investigations, Oil and gas exploration, Penalties,
                Pipelines, Continental Shelf--mineral resources, Continental Shelf--
                rights-of-way, Reporting and recordkeeping requirements, Sulfur.
                Casey Hammond,
                Acting Assistant Secretary--Land and Minerals Management, U.S.
                Department of the Interior.
                 For the reasons given in the preamble, Bureau of Safety and
                Environmental Enforcement (BSEE) amends Title 30, Chapter II,
                Subchapter B, Part 250 of the Code of Federal Regulations as follows.
                PART 250--OIL AND GAS AND SULFUR OPERATIONS IN THE OUTER
                CONTINENTAL SHELF
                0
                1. The authority citation for 30 CFR Part 250 continues to read as
                follows:
                 Authority: 30 U.S.C. 1751, 31 U.S.C. 9701, 33 U.S.C.
                1321(j)(1)(C), 43 U.S.C. 1334.
                0
                2. Revise Sec. 250.1403 to read as follows:
                Sec. 250.1403 What is the maximum civil penalty?
                 The maximum civil penalty is $45,463 per day per violation.
                [FR Doc. 2020-03694 Filed 3-3-20; 8:45 am]
                 BILLING CODE 4310-VH-P
                

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