Civil Penalties |
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David L. Strickland
National Highway Traffic Safety Administration
November 27, 2012
[Federal Register Volume 77, Number 228 (Tuesday, November 27, 2012)]
[Rules and Regulations]
[Pages 70710-70713]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2012-28694]
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DEPARTMENT OF TRANSPORTATION
National Highway Traffic Safety Administration
49 CFR Part 578
[Docket No. NHTSA-2012-0131; Notice 2]
RIN 2127-AL16
Civil Penalties
AGENCY: National Highway Traffic Safety Administration (NHTSA), DOT.
ACTION: Final rule.
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SUMMARY: This document increases the maximum civil penalty amounts for
violations of motor vehicle safety requirements for the National
Traffic and Motor Vehicle Safety Act, as amended, and violations of
bumper standards and consumer information provisions. Specifically,
this increases the maximum civil penalty amounts for single violations
of motor vehicle safety requirements, a series of related violations of
school bus and equipment safety requirements, a series of related
violations of bumper standards, and a series of related violations of
consumer information regarding crashworthiness and damage
susceptibility requirements. This action is taken pursuant to the
Federal Civil Monetary Penalty Inflation Adjustment Act of 1990, as
amended by the Debt Collection Improvement Act of 1996, which requires
us to review and, as warranted, adjust penalties based on inflation at
least every four years.
DATES: This rule is effective December 27, 2012.
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: Matthew Weisman, Office of Chief
Counsel, NHTSA, telephone (202) 366-5834, facsimile (202) 366-3820,
1200 New Jersey Ave, SE., Washington, DC 20590.
SUPPLEMENTARY INFORMATION:
I. Background
In order to preserve the remedial impact of civil penalties and to
foster compliance with the law, the Federal Civil Monetary Penalty
Inflation Adjustment Act of 1990 (28 U.S.C. 2461 Notes, Pub. L. 101-
410), as amended by the Debt Collection Improvement Act of 1996 (Pub.
L. 104-134) (referred to collectively as the ``Adjustment Act'' or, in
context, the ``Act''), requires us and other Federal agencies to adjust
civil penalties for inflation. Under the Adjustment Act, following an
initial adjustment that was capped by the Act, these agencies must make
further adjustments, as warranted, to the amounts of penalties in
statutes they administer at least once every four years.
NHTSA's initial adjustment of civil penalties under the Adjustment
Act was published on February 4, 1997. 62 FR 5167. At that time, we
codified the penalties under statutes administered by NHTSA, as
adjusted, in 49 CFR part 578, Civil Penalties. Thereafter, we adjusted
certain penalties based on the Adjustment Act and codified others based
on other laws including the Transportation Recall Enhancement,
Accountability, and Documentation Act.
On May 16, 2006, NHTSA last adjusted the maximum civil penalty for
a single violation of the Motor Vehicle Safety Act, sections 30112,
30115, 30117 through 30122, 30123, 30125(c), 30127, or 30141 through
30147 of Title 49 of the United States Code or a regulation thereunder,
as specified in 49 CFR 578.6(a)(1) from $5,000 to $6,000. 71 FR 28279.
At the same time, the agency adjusted the maximum civil penalty for a
single violation of the Motor Vehicle Safety Act, section 30166 of
Title 49 of the United States Code or a regulation thereunder, to
$6,000.
On February 10, 2010, NHTSA last adjusted the maximum civil penalty
for a related series of violations of the Motor Vehicle Safety Act as
amended involving school buses and school bus equipment, section
30112(a)(1) as it involves school buses and school bus equipment and
section 30112(a)(2) of Title 49 of the United States Code, as specified
in 49 CFR 578.6(a)(2) from $15,000,000 to $16,650,000. 75 FR 5246.
Also on February 10, 2010, NHTSA last adjusted the maximum civil
penalty for a related series of violations of bumper standards, section
32506 of Title 49 of the United States Code, as specified in 49 CFR
578.6(c)(2) from $1,025,000 to $1,175,000. 75 FR 5246. In addition, on
February 10, 2010, NHTSA last adjusted the maximum civil penalty for a
related series of violations of consumer information requirements
regarding crashworthiness and damage susceptibility, section 32308 of
Title 49 of the United States Code, as specified in 49 CFR 578.6(d)(1)
from $500,000 to $575,000. 75 FR 5246.
We have reviewed the civil penalty amounts in 49 CFR part 578 and
on September 7, 2012, published a NPRM initiating this rulemaking to
adjust
[[Page 70711]]
certain penalties under the Adjustment Act. 77 FR 55175.
II. Method of Calculation--Adjustments
Under the Adjustment Act, we determine the inflation adjustment for
each applicable civil penalty by increasing the maximum civil penalty
amount per violation by a cost-of-living adjustment, and then applying
a rounding factor. Section 5(b) of the Adjustment Act defines the
``cost-of-living'' adjustment as: The percentage (if any) for each
civil monetary penalty by which--
(1) The Consumer Price Index for the month of June of the calendar
year preceding the adjustment exceeds
(2) The Consumer Price Index for the month of June of the calendar
year in which the amount of such civil monetary penalty was last set or
adjusted pursuant to law.
Since the adjustment is intended to be effective before December
31, 2012, the ``Consumer Price Index [CPI] for the month of June of the
calendar year preceding the adjustment'' would be the CPI for June
2011. This figure, based on the Adjustment Act's requirement of using
the CPI ``for all-urban consumers published by the Department of
Labor'' is 676.162. The penalty amounts that NHTSA is adjusting based
on the Adjustment Act's requirements were last set in 2006 for a single
violation of the Motor Vehicle Safety Act, and in 2010 for a series of
related violations of school bus safety requirements, a series of
related violations of bumper standards, and a series of related
violations of consumer information requirements regarding
crashworthiness and damage susceptibility. The CPI figure for June of
2006 is 607.8 and June of 2010 is 652.926
Individuals interested in deriving the CPI figures used by the
agency may visit the Department of Labor's Consumer Price Index Home
Page at http://www.bls.gov/cpi/home.htm. Scroll down to ``CPI
Databases'', ``All Urban Consumers (Current Series)'', and click on
``Top Picks''. Next, select the ``U.S. ALL ITEMS 1967=100--
CUUR0000AA0'' box, and click on the ``Retrieve Data'' button.
Accordingly, the factors that we are using in calculating the
increases are 1.11 (676.162/607.8) for a single Motor Vehicle Safety
Act violation and 1.04 (676.162/652.926) for a related series of Motor
Vehicle Safety Act violations pertaining to school buses or school bus
equipment, as well as for a series of related violations of bumper
standards, and a series of related violations of consumer information
requirements. Using these inflation factors, calculated increases under
these adjustments are then subject to a specific rounding formula set
forth in Section 5(a) of the Adjustment Act. 28 U.S.C. 2461, Notes.
Under that formula:
Any increase shall be rounded to the nearest:
(1) Multiple of $10 in the case of penalties less than or equal to
$100;
(2) Multiple of $100 in the case of penalties greater than $100 but
less than or equal to $1,000;
(3) Multiple of $1,000 in the case of penalties greater than $1,000
but less than or equal to $10,000;
(4) Multiple of $5,000 in the case of penalties greater than
$10,000 but less than or equal to $100,000;
(5) Multiple of $10,000 in the case of penalties greater than
$100,000 but less than or equal to $200,000; and
(6) Multiple of $25,000 in the case of penalties greater than
$200,000.
III. Changes to Maximum Penalties Under the Motor Vehicle Safety Act,
49 U.S.C. Chapter 301
Changes to 49 CFR 578.6(a)(1), (a)(3)
The maximum civil penalty for a violation of 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 $6,000, as specified in 49 CFR
578.6(a)(1). The underlying statutory civil penalty provision is 49
U.S.C. 30165(a)(1). Applying the appropriate inflation factor (1.11) to
the Adjustment Act calculation raises the $6,000 figure to $6,679, an
increase of $679. Under the rounding formula, any increase in a
penalty's amount shall be rounded to the nearest multiple of $1,000. In
this case, the increase would be $1,000. Accordingly, NHTSA is amending
Section 578.6(a)(1) to increase the maximum civil penalty from $6,000
to $7,000 for each violation.
The maximum civil penalty for a violation of section 30166 of Title
49 of the United States Code or a regulation prescribed under that
section is $6,000, as specified in 49 CFR 578.6(a)(3). The underlying
statutory civil penalty provision is 49 U.S.C. 30165(a)(3). Applying
the appropriate inflation factor (1.11) to the Adjustment Act
calculation raises the $6,000 figure to $6,679, an increase of $679.
Under the rounding formula, any increase in a penalty's amount shall be
rounded to the nearest multiple of $1,000. In this case, the increase
would be $1,000. Accordingly, NHTSA is amending Section 578.6(a)(3) to
increase the maximum civil penalty from $6,000 to $7,000 per violation
per day.
Change to 49 CFR 578.6(a)(2)
The maximum civil penalty for a series of related violations of
section 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 is $16,650,000, as
codified in 49 CFR 578.6(a)(2). The underlying statutory civil penalty
provision is 49 U.S.C. 30165(a)(2). Applying the appropriate inflation
factor (1.04) to the Adjustment Act calculation raises the $16,650,000
figure to $17,242,531, an increase of $592,531. Applying the rounding
rules, which instruct that increases be rounded to the closest $25,000,
produces an increase of $600,000. Accordingly, NHTSA is increasing the
maximum penalty under Section 578.6(a)(2) to $17,250,000.
Change to Maximum Penalty Under 49 U.S.C. 32506(a) (49 CFR 578.6(c))
The maximum civil penalty for a series of related violations of
bumper prohibitions, section 32506(a) of Title 49 of the United States
Code, is $1,175,000 as specified in 49 CFR 578.6(c). The underlying
statutory civil penalty provision is 49 U.S.C. 32507. Applying the
appropriate inflation factor (1.04) to the Adjustment Act calculation
raises the $1,175,000 figure to $1,216,815, an increase of $41,815.
Applying the rounding rules, which instructs that increases be rounded
to the closest $25,000, produces an increase of $50,000. Accordingly,
NHTSA is increasing the maximum penalty under Section 578.6(c)(2) to
$1,225,000.
Change to Maximum Penalty Under the Consumer Information Provisions (49
CFR 578.6(d)(1))
The maximum civil penalty for a series of related violations of
consumer information provisions regarding crashworthiness and damage
susceptibility, section 32308(a) of Title 49 of the United States Code,
is $575,000 as specified in 49 CFR 578.6(d)(1). Applying the
appropriate inflation factor (1.04) to the Adjustment Act calculation
raises the $575,000 figure to $595,462, an increase of $20,462.
Applying the rounding rules, which instruct that increases be rounded
to the closest $25,000, produces an increase of $25,000. Accordingly,
NHTSA is increasing the maximum penalty under Section 578.6(d)(1) to
$600,000.
[[Page 70712]]
Codification of Penalty in the Medium and Heavy Duty Vehicle Fuel
Efficiency Program
The Agency's regulations provide that the maximum penalty is
$37,500 per vehicle or engine. 49 CFR 535.9(b)(3). Consistent with the
approach of codifying the penalties under statutes administered by
NHTSA in Part 578, NHTSA is codifying this amount in a new subsection
(i) of 49 CFR 578.6.
IV. Public Comments on NPRM
NHTSA received one public comment in response to the Notice of
Proposed Rulemaking for this rulemaking. The comment was from a private
individual expressing support for the proposed rulemaking, noting that
civil penalties can lose their effectiveness over time through
inflation, and that review and amendment of penalties is necessary to
maintain their effectiveness.
V. Rulemaking Analyses and Notices
Executive Order 12866 and DOT Regulatory Policies and Procedures
We have considered the impact of this rulemaking action under
Executive Order 12866 and the Department of Transportation's regulatory
policies and procedures. This rulemaking document was not reviewed
under Executive Order 12866, ``Regulatory Planning and Review.'' 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.
Regulatory Flexibility Act
We have also considered the impacts of this notice under the
Regulatory Flexibility Act. I certify that a 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 (Motor Vehicle Safety Act) and therefore may be
affected by the adjustments made in this rulemaking. For example, based
on comprehensive reporting pursuant to the early warning reporting
(EWR) rule under the Motor Vehicle 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
maximum penalty amounts that the agency could obtain for a single
violation and a related series of violations of various provisions of
the Motor Vehicle Safety Act, as well as for a series of related
violations of bumper standards, and a series of related violations of
consumer information requirements for violations. Under the Motor
Vehicle 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 penalty amounts, this rule
will not have a significant economic impact on small businesses. 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. As explained above, this action is limited
to the adoption of a statutory directive, and has been determined to be
not ``significant'' under the Department of Transportation's regulatory
policies and procedures.
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
[[Page 70713]]
vehicle repair businesses. It will have very limited applicability to
States or local governments, as where they purchase or lease 15
passenger vans used for certain school purposes or activities, which
vans do not comply with federal motor vehicle safety standards for
school buses and multifunction school activity buses. 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 a rule based on this proposal 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, 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 amended by revising paragraphs (a), (c)(2), and
(d)(1) and adding paragraph (i) 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 $7,000
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 $17,350,000.
(2) School buses. (A) 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 $11,000 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 this section. The maximum penalty under this
paragraph for a related series of violations is $17,250,000.
(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
$7,000 per violation per day. The maximum penalty under this paragraph
for a related series of daily violations is $17,350,000.
* * * * *
(c) * * *
(2) The maximum civil penalty under this paragraph (c) for a
related series of violations is $1,225,000.
(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 $1,100 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 $600,000.
* * * * *
(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 $37,500 per vehicle or engine. The
maximum civil penalty for a related series of violations shall be
determined by multiplying $37,500.00 times the vehicle or engine
production volume for the model year in question within the regulatory
averaging set.
Issued on: November 19, 2012.
David L. Strickland,
Administrator.
[FR Doc. 2012-28694 Filed 11-26-12; 8:45 am]
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