Federal Register / Vol. 77, No. 85 / Wednesday, May 2, 2012 / Rules and Regulations 25881 

in alphabetical order, and remove the 

definition RIK, in paragraph (a) as set 

forth below. 

■ b. Revise paragraph (d)(2) to read as 

set forth below. 

■ c. Remove paragraph (d)(3). 

■ d. Add ‘‘6th Avenue and Kipling 

Street,’’ after ‘‘Denver Federal Center,’’ 

and remove ‘‘–0165’’ after ‘‘80225’’ in 

paragraph (e). 

§ 1218.51 How to make payments. 

(a) Definitions. 

ACH—Automated Clearing House. A 

type of EFT using the ACH bank-to-bank 

network. 

* * * * * 

EFT—Electronic Funds Transfer. Any 

paperless transfer of funds initiated 

through an electronic terminal. For 

ONRR purposes, EFT includes Fedwire 

and ACH transfers, such as Pay.gov. 

Fedwire—A type of EFT using the 

Federal Reserve Wire network. 

* * * * * 

Pay.gov—A type of EFT using the 

ACH network that is initiated by a payor 

on the Pay.gov Web site. 

* * * * * 

(d) * * * 

(2) For a Federal nonproducing lease 

rental or deferred bonus payment, send 

it to: Office of Natural Resources 

Revenue, P.O. Box 25627, Denver, CO 

80225–0627. 

* * * * * 

■ 19. Revise § 1218.560 to read as 

follows: 

§ 1218.560 How do I submit Form MMS– 

4444? 

You may obtain a copy of Form 

MMS–4444 and instructions from 

ONRR. This form is posted at http:// 

www.onrr.gov/FM/Forms/default.htm. 

Submit the completed, signed form to 

the address designated on Form MMS– 

4444 instructions. 

[FR Doc. 2012–10360 Filed 5–1–12; 8:45 am] 

BILLING CODE 4310–T2–P 

DEPARTMENT OF THE INTERIOR 

Office of Natural Resources Revenue 

30 CFR Part 1218 

[Docket No. ONRR–2011–0010] 

RIN 1012–AA03 

Debt Collection and Administrative 

Offset for Monies Due the Federal 

Government 

AGENCY: Office of Natural Resources 

Revenue. 

ACTION: Final rule. 

SUMMARY: The Office of Natural 

Resources Revenue (ONRR) is 

promulgating regulations to establish 

procedures governing collection of 

delinquent royalties, rentals, bonuses, 

and other amounts due under leases and 

other agreements for the production of 

oil, natural gas, coal, geothermal energy, 

other minerals, and renewable energy 

from Federal lands onshore, Indian 

tribal and allotted lands, and the Outer 

Continental Shelf. The regulations 

include provisions for administrative 

offset and clarify and implement the 

provisions of the Debt Collection Act of 

1982 (DCA) and the Debt Collection 

Improvement Act of 1996 (DCIA). 

DATES: Effective Date: June 1, 2012. 

FOR FURTHER INFORMATION CONTACT: For 

comments or questions on procedural 

issues, contact Hyla Hurst, Regulatory 

Specialist, ONRR, telephone (303) 231– 

3495. For questions on technical issues, 

contact Sarah L. Inderbitzin, Office of 

Enforcement, ONRR, telephone (303) 

231–3748. 

SUPPLEMENTARY INFORMATION: 

I. Background 

The ONRR is responsible for 

collecting, accounting for, and 

disbursing billions of dollars per year in 

bonus, rental, royalty, and other 

revenues derived from leases and other 

agreements for the production of oil, 

natural gas, coal, geothermal energy, 

other minerals, and renewable energy 

from Federal lands onshore, Indian 

tribal and allotted lands, and the Outer 

Continental Shelf. The ONRR also is 

responsible for enforcement of royalty 

and other payment obligations under 

applicable statutes, regulations, leases, 

agreements, and contracts. 

The ONRR undertakes current debt 

collection activities under the DCA 

(Pub. L. 97–365), as amended by the 

DCIA (Pub. L. 104–134, Title III, Ch. 10, 

110 Stat. 1321–359—1321–380 (codified 

at 31 U.S.C. 3711, 3716–18, and 3720A). 

The DCIA was enacted primarily to 

increase collection of nontax debts 

owed to the Federal Government. 

Among other provisions, the DCIA 

centralized the administrative collection 

of much delinquent nontax debt at the 

U.S. Department of the Treasury’s 

Financial Management Service 

(Treasury) to increase the efficiency of 

collection efforts. Government agencies 

are required to transfer nontax debt that 

has been delinquent for 180 days to 

Treasury for further collection action, 

including administrative offset. 

This final rule (1) implements 

statutory provisions of the DCA, as 

amended by the DCIA, and (2) 

supplements the Government-wide debt 

collection standards promulgated by the 

Departments of the Treasury and Justice, 

known as the Federal Claims Collection 

Standards (FCCS) (31 CFR parts 900– 

904), as necessary and appropriate for 

ONRR operations. The DCIA grants the 

Secretary discretionary authority in 

many aspects of debt collection, and 

this final rule defines the parameters of 

this authority. This final rule also makes 

some nonsubstantive technical or 

clarifying changes to the proposed rule. 

In the interim between development 

of the proposed rule and the final rule, 

the Secretary of the Interior separated 

the responsibilities previously 

performed by the former Minerals 

Management Service (MMS) and 

reassigned those responsibilities to three 

separate organizations. As part of this 

reorganization, the Secretary renamed 

MMS’s Minerals Revenue Management 

(MRM) the Office of Natural Resources 

Revenue and directed that ONRR 

transition to the Office of Policy, 

Management and Budget, effective 

October 1, 2010. This change required 

the reorganization of title 30 of the Code 

of Federal Regulations. In a direct final 

rule (effective October 1, 2010), ONRR 

removed the royalty and other revenue 

reporting, payment, valuation, and 

appeal regulations from 30 CFR, chapter 

II, and recodified them in the new 

chapter XII. Thus, the 30 CFR citations 

in this final rule are to part 1218 rather 

than to part 218, as they were in the 

proposed rule. Neither these nor any of 

the plain language changes discussed 

below effect any substantive change in 

meaning. 

II. Comments on the Proposed Rule 

The proposed rule was published on 

June 8, 2010 (75 FR 32343). We received 

comments on the proposed rule from 

one nonprofit organization and one 

trade association. We have analyzed 

these comments, which are discussed 

below: 

A. General Comments 

General comments on the proposed 

rule fall into five categories: (1) Plain 

language, (2) Treasury fees, (3) Treasury 

offsets, (4) Chronology of collection 

efforts, and (5) Early resolution of bills 

and demands. 

(1) Plain Language 

Public Comments: The nonprofit 

organization commented that the entire 

regulation should be rewritten in plain 

language. 

ONRR Response: In order to be 

consistent with other debt collection 

regulations, ONRR specifically adopted 

regulatory language implementing the 

DCA and DCIA that other agencies and 


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the Department of the Interior 

(Department) have already promulgated. 

See, e.g., Department of the Interior, 

National Indian Gaming Commission, 

debt collection regulations at 25 CFR 

part 513, and the Department of Health 

and Human Services debt collection 

regulations at 45 CFR parts 30 and 33. 

In the proposed rule, ONRR used plain 

language where it was appropriate and 

did not change the substantive meaning 

of those regulations. Although we 

decline to rewrite the entire rule as the 

commenter suggested, we have used 

plain language in the final rule in 

instances where plain language is 

appropriate and does not change the 

substance of the rule. For example, in 

§ 1218.702(a), we replaced ‘‘The ONRR 

will collect debts from you in 

accordance with the regulations in this 

subpart * * *.’’ with ‘‘The ONRR will 

collect debts from you under the 

regulations in this subpart * * *.’’ 

(2) Treasury Fees 

Public Comments: The trade 

association commented that Treasury 

has sometimes duplicated offsets and 

collected the same debt twice. When 

this occurs, the commenter notes that, 

although ONRR refunds the duplicate 

payment to the company, companies 

cannot recover the duplicate fee 

Treasury charges. The commenter 

believes that this rulemaking should 

give Treasury authority to remit the 

duplicate fee charged. 

ONRR Response: Treasury currently 

charges a fee of $17.00 per offset 

(beginning October 1, 2010). Treasury, 

not ONRR, charges and keeps this fee. 

The ONRR does not have authority in 

this rulemaking to refund fees charged 

by Treasury or to address Treasury’s 

processes. Thus, debtors need to make 

requests to Treasury for refunds of 

duplicate offset fees. 

(3) Treasury Offsets 

Public Comments: The trade 

association commented that, because an 

ONRR debt referred to Treasury may be 

offset by another Federal Government 

overpayment or monies due the debtor, 

in some cases, it is difficult to know 

where the offset occurs. The commenter 

also believes that this may result in 

cascading debt collection notices due to 

differing accounting and reporting 

records of debtors and the Federal 

Government. The commenter is 

concerned that a company may believe 

that their records are reconciled while 

the Federal Government continues to 

impose fines and fees for unknown 

debts. The commenter observes that the 

proposed rule does not identify a system 

to reconcile records. 

ONRR Response: Treasury performs 

administrative offsets. The ONRR 

merely refers the debts to Treasury; 

Treasury does not provide us with the 

details of its offsets, and we do not have 

the authority to address Treasury’s 

offset processes in this rulemaking. 

Thus, debtors need to work with 

Treasury regarding concerns about 

offsets and reconciling records. 

(4) Chronology of Collection Efforts 

Public Comments: The trade 

association suggested that we add a 

description of the chronological order of 

ONRR’s debt collection process to the 

final rule to help clarify that process. 

ONRR Response: The ONRR provided 

the chronological description of our 

internal debt referral process in the 

preamble to the proposed rule (75 FR 

32343). However, we do not believe it 

is appropriate to codify such internal 

processes in the final rulemaking. 

(5) Early Resolution of Bills and 

Demands 

The trade association observed that a 

company may receive a bill or demand 

for many reasons. The commenter stated 

examples such as the original invoice 

being misdirected or never received, or 

the original debt being for another 

company but the operating rights owner 

received the bill. The commenter notes 

that, after significant research, some 

bills are found to already have been 

paid. The commenter believes that 

better communication would ensure 

early resolution of debts. The 

commenter also believes that these 

items could be cleared earlier in the 

process if ONRR addressed information 

provided by industry in a timelier 

manner. 

ONRR Response: The ONRR issues 

bills and demands to lessees of record, 

operating rights holders, payors, and 

designees to collect royalties, rents, and 

other revenues due on Federal and 

Indian leases. The ONRR makes every 

effort to send bills and demands to the 

correct company and to resolve debts 

prior to referral to Treasury. However, it 

is the responsibility of the company 

who receives the bill or demand to 

either acknowledge the debt by timely 

payment or disagree with the debt by 

appealing the bill or demand within 30 

days of its receipt of the bill or demand. 

In addition, before appealing, the 

company may contact ONRR to discuss 

the bill or demand. Nevertheless, 

contacting ONRR to discuss the bill or 

demand does not relieve the company of 

the requirement to file an appeal within 

30 days under 30 CFR part 1290, if the 

bill or demand is not resolved prior to 

that date. The ONRR provides contact 

information on all bills and demands. In 

addition, contact information for 

ONRR’s Financial Services program is 

available on our Web site at http:// 

www.onrr.gov/fm/ContactInfo.htm. 

The ONRR also sends bills or 

demands to the lessee’s or payor’s 

address of record, which is obtained 

either from ONRR’s system or from the 

Bureau of Land Management’s (BLM) 

LR2000 system. It is the company’s 

responsibility to keep ONRR and BLM 

informed of the company’s current 

address and contacts so that ONRR does 

not misdirect mailed bills and demands. 

Companies must update their contact 

information on Form MMS–4444, 

Addressee of Record Designation for 

Service of Official Correspondence (we 

are in the process of updating our 

regulations to replace MMS in our form 

numbers with ONRR), available on the 

ONRR Web site, at http://www.onrr.gov/ 

FM/Forms/default.htm. The company 

must contact the appropriate BLM office 

for BLM address changes. 

Public Comments: The trade 

association believes that debts referred 

to Treasury have sometimes been 

caused by ONRR errors, such as 

misapplying payments or generating 

duplicate interest bills. The commenter 

encourages ONRR to dedicate time and 

resources to the accuracy of its internal 

accounting. 

ONRR Response: The ONRR commits 

significant time and resources to 

reconcile payments with receivables in 

its system. However, when company 

accounts are deficient or when a 

company does not specify how the 

payment should be applied, payments 

are applied to receivables using the 

First-In First-Out method of accounting. 

This process is necessary because 

Treasury will not accept referrals until 

all payments have been applied to 

receivables, leaving only open 

receivables in an account. 

The ONRR acknowledges that we 

have issued some duplicate interest 

bills. However, we have initiated 

process improvements to prevent future 

occurrences. 

Public Comments: The trade 

association commented that limited 

detail provided on demand notices 

makes it difficult for companies to 

respond, resulting in escalation of 

collection efforts. The commenter 

believes that better information is 

needed to resolve collections in a timely 

manner. The commenter stated the 

belief that additional information exists 

in the Statement of Account system that 

could assist in resolving debt. The 

commenter recommended that 

companies be given access to the 

additional information from the 


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Statement of Account for timely bill 

resolution. 

ONRR Response: With each initial bill 

or order to pay, ONRR includes related 

reports with detailed information. When 

a company does not timely pay a bill or 

order, if the original bill or order did not 

contain language stating that ONRR may 

refer the bill or order to Treasury to 

collect, then ONRR sends a followup 

letter to the original recipient, as well as 

to each potentially liable lessee, with an 

attachment that reflects a roll-up of the 

original bill. It is the recipient’s 

responsibility to contact ONRR to 

request lease-specific information 

provided on the original bill or demand. 

Through ONRR’s Data Warehouse, 

found at https://dwportal.onrr.gov, 

companies can access their Statement of 

Account, showing the dates and 

balances of all open receivables for each 

company’s account. However, the 

Statement of Account does not contain 

detailed information on the items listed 

in an original bill or demand. 

Nevertheless, companies can access 

detailed information in the Data 

Warehouse for Interest (INT) bills and 

Indian over-recoupment (IOR) bills. 

When ONRR issues an INT or IOR 

invoice, we place the invoice and 

associated invoice reports (three 

different reports for INT, and one for 

IOR) in each company’s folder in the 

Data Warehouse. 

Public Comments: The trade 

association recommended that ONRR 

provide companies electronic 

notification of indebtedness by email to 

facilitate timely resolution of debts and 

decrease billing errors. 

ONRR Response: As stated above, all 

INT and IOR bills are placed in a 

company’s folder in the Data 

Warehouse. When a company receives 

access to their folder in the Data 

Warehouse, the designated contact 

receives an email notification when an 

invoice is issued and placed in their 

folder (eInvoice). The purpose of 

eInvoice is to address company 

complaints about the large volumes of 

paper invoice reports sent with the bill 

and the difficulty of analyzing reports in 

that format. To address this concern, 

eInvoice gives companies the 

opportunity to download the reports 

that accompany INT and IOR bills in 

order to more efficiently analyze those 

reports. The FIN bills (financial term 

bills for rent and minimum royalty) and 

OTH bills (usually penalty bills or 

compliance bills) have no associated 

reports. Thus, ONRR sends paper FINs 

and OTHs because they do not have the 

volume issue we addressed for INT and 

IOR bills. For the same reason, ONRR 

does not electronically send the 

followup demands issued to other liable 

companies, when the original recipient 

of a bill or demand does not pay. 

B. Specific Comments on 30 CFR Part 

1218—Subpart J—Debt Collection and 

Administrative Offset 

(1) 30 CFR 1218.700 What definitions 

apply to this subpart? 

Definitions of ‘‘BIA,’’ ‘‘BLM,’’ and 

‘‘BOEMRE’’ 

We did not receive any comments 

regarding these definitions. However, in 

this final rule, we are removing 

references to specific leasing or 

regulatory agencies that were in the 

proposed rule in this definitions section 

and elsewhere. The Bureau of Indian 

Affairs (BIA) and BLM names remain 

the same. However, the Bureau of Ocean 

Energy Management, Regulation and 

Enforcement (BOEMRE) is now two 

separate bureaus, the Bureau of Ocean 

Energy Management (BOEM) and 

Bureau of Safety and Environmental 

Enforcement (BSEE). 

Definition of ‘‘Debtor’’ 

Public Comments: The nonprofit 

organization suggested defining the 

pronouns ‘‘you’’ in the regulatory texts 

and ‘‘I’’ in the headings to refer to the 

debtor. 

ONRR Response: The ONRR agrees 

that, for purposes of plain language, 

‘‘you’’ can be defined as the ‘‘debtor,’’ 

and ONRR has made that change in the 

final rule. Therefore, in the final rule, 

‘‘you’’ would be defined as the debtor in 

a new paragraph (u). However, we 

decline to also define ‘‘I’’ as the debtor 

because the term ‘‘I’’ is not used in the 

headings in this final rule. 

Definition of ‘‘Delinquent’’ 

Public Comments: The trade 

association suggested adding a 

definition of ‘‘past due’’ even though it 

appears to be covered by the definition 

of ‘‘delinquent.’’ The commenter 

believes that adding a definition for 

‘‘past due’’ would support ONRR’s 

stated goal of prescribing procedures 

specifically applicable to ONRR 

operations. As an alternative, the trade 

association suggested deleting ‘‘past 

due.’’ 

ONRR Response: The commenter is 

correct that ‘‘past due’’ means the same 

as ‘‘delinquent.’’ Therefore, in 

§ 1218.700, ONRR has added a 

definition of ‘‘past due’’ stating that 

‘‘past due has the same meaning as 

‘delinquent,’ as defined above.’’ We are 

also adding the term ‘‘past due’’ to the 

definition of ‘‘delinquent.’’ In addition, 

to make clear that debts are not 

delinquent unless ‘‘legally enforceable,’’ 

we added that term to the definition and 

added language to clarify that debts or 

claims are delinquent when not paid by 

the time prescribed by the applicable 

act, law, regulation, lease, order, 

demand, notice of noncompliance, and/ 

or assessment of civil penalties, 

contract, decision, or any other 

agreement. In the final rule the term is 

defined as follows: ‘‘Delinquent or past 

due refers to the status of a debt and 

means a debt that is legally enforceable 

and has not been paid within the time 

limit prescribed by the applicable act, 

law, regulation, lease, order, demand, 

notice of noncompliance, and/or 

assessment of civil penalties, contract, 

decision, or any other agreement.’’ 

Definition of ‘‘Legally Enforceable’’ 

Although we did not receive 

comments on this definition, we made 

a change to this term to make clear that 

we will refer debts or claims only for 

which there has been a final nonappealable agency determination that 

the debt, in the amount stated, is due. 

See discussion of the terms ‘‘debt’’ and 

‘‘claim’’ below. 

The rule still states that we also will 

determine there are no legal bars to 

collection by offset such as debts subject 

to the Bankruptcy Code (Title 11 of the 

United States Code). For such debts, 

bankruptcy law will govern the debt 

collection process. 

Definition of ‘‘Lessee’’ 

Public Comments: The trade 

association commented that the 

definition of ‘‘lessee’’ under 30 CFR part 

1218 in the proposed rule is broader 

than the definition of ‘‘lessee’’ in part 

1290. The association believes that 

different definitions under the parts 

would create the potential for 

confusion, ambiguity, and inconsistent 

results. The commenter also believes 

that the definition in 30 CFR part 1218 

expands the potential liability of a 

party’s debts to include those of another 

owner in the same property. Finally, the 

commenter believes that the regulations 

regarding the underpayment or 

nonpayment of royalties by a 

responsible party should not deviate 

from definitions set forth in the Royalty 

Simplification and Fairness Act (RSFA), 

Public Law 104–185, 110 Stat. 1700, as 

corrected by Public Law 104–200. 

ONRR Response: The ONRR intended 

the definition of ‘‘lessee’’ under this 

rulemaking to be broad because this rule 

applies to all mineral lessees, not just 

Federal oil and gas leases. As we stated 

in the preamble to the proposed rule, 

‘‘[t]he definition in subsection (o) is 

broader than the definition of ‘lessee’ in 

30 CFR part 1206 because it is intended 


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25884 Federal Register / Vol. 77, No. 85 / Wednesday, May 2, 2012 / Rules and Regulations 

to apply to holders of leases and other 

contracts and agreements for any type of 

Federal and Indian minerals and 

resources’’ (75 FR 32344). However, 

nothing in this rulemaking purports to 

change a lessee’s liability for payments. 

Indeed, under proposed § 1218.702(b), 

ONRR will transfer only ‘‘legally 

enforceable’’ delinquent debts (defined 

as a final, non-appealable agency 

determination that the debt, in the 

amount stated, is due, and there are no 

legal bars to collection by offset). If a 

person is not liable for the debt, then, 

by definition, it is not ‘‘legally 

enforceable’’ against that person. 

Finally, RSFA applies only to Federal 

oil and gas leases. Thus, the definition 

of ‘‘lessee’’ in this part needs to be 

broader than RSFA because the rule also 

applies to debts on leases other than 

Federal oil and gas leases. 

Definition of ‘‘Other Agreement’’ and 

‘‘Lease’’ 

Public Comments: The trade 

association noted that paragraph 

1218.702(b) refers to ‘‘other agreements’’ 

but does not provide a definition or 

illustration of agreements here or 

elsewhere in this subpart. 

ONRR Response: With respect to the 

use of the term ‘‘other agreement’’ in the 

definitions of ‘‘delinquent debt’’ and 

‘‘lessee,’’ it means any ‘‘agreement to 

pay the Department money, funds, or 

property,’’ which is not necessarily tied 

to the extraction, development, or use of 

a mineral or other resource. For 

example, a gas storage agreement 

between BLM and a lessee would be an 

‘‘other agreement.’’ Such agreements are 

distinguishable from leases that 

authorize exploration for and 

production of oil, natural gas, other 

minerals or geothermal resources, or 

production of renewable energy. 

To be clear, ONRR is adding the 

following definition of ‘‘other 

agreement’’ in a new paragraph (p) in 

§ 1218.700 in the final rule and making 

corresponding changes to the portions 

of the rule that refer to that term: 

(p) Other agreement means any 

agreement other than a lease, and 

includes, but is not limited to, any 

agreement between you and the 

Department to pay the Department 

money, funds, or property, regardless of 

form. 

For clarity, we have also added a 

definition of the term ‘‘lease’’ in the 

final rule as follows: ‘‘Lease means any 

contract, profit-share arrangement, joint 

venture, or other agreement issued or 

approved by the United States under 

any statutory authority, including but 

not limited to a mineral leasing law, that 

authorizes exploration for and 

development or extraction of oil, gas, 

coal, any other mineral or geothermal 

resources, or power generation from 

renewable energy sources, on Federal or 

Indian tribal or allotted lands or the 

Outer Continental Shelf. Depending on 

the context, lease also may refer to the 

land area covered by that 

authorization.’’ 

Definition of ‘‘Debt’’ and ‘‘Claim’’ 

The ONRR received no public 

comment on the proposed definition of 

these terms. However, in preparing the 

final rule, we have concluded that 

further clarity in this definition is 

appropriate. We added to this definition 

that debts or claims must be ‘‘legally 

enforceable.’’ We added that term to the 

definition to make clear that only nonappealable final decisions of the 

Department are referable debts or claims 

because when ONRR or the ONRR 

Director issues an order or decision that 

then is appealed or is appealable to a 

higher level within the Department, the 

lessee’s or payor’s ultimate liability has 

not been finally established within the 

Department. In these circumstances, 

referral to the Treasury Department for 

further collection action under the DCA 

and FCCS is not appropriate. As 

discussed above, ONRR also has made 

a corresponding change to the definition 

of ‘‘legally enforceable’’ in the final rule 

to refer to a final non-appealable agency 

determination that the debt is due. 

This revised definition also refers 

only to debts owed to or collectible by 

the United States, because lessees and 

royalty payors and holders of permits, 

easements, or rights-of-way for 

production of renewable energy do not 

owe money to states or other political 

subdivisions. We added ‘‘collectible by’’ 

to cover debts the Department collects 

on behalf of others, including, but not 

limited to, individual Indian mineral 

owners and Indian tribes. 

(2) 30 CFR 1218.701 What is ONRR’s 

authority to issue these regulations? 

We received no comments on this 

section. However, in the final rule, we 

have made clarifying technical revisions 

to paragraph (b) to make clear that the 

regulations adopted in this final rule 

will supplement and adapt the FCCS as 

necessary and appropriate to ONRR’s 

particular enforcement circumstances 

and sphere of responsibility. 

(3) 30 CFR 1218.702 What happens to 

delinquent debts you owe ONRR? 

We received no comments on 

paragraph (a). In the final rule, however, 

we are clarifying that ONRR will collect 

debts under these regulations ‘‘in 

addition to other applicable statutory 

and regulatory authorities.’’ For 

example, the Federal Oil and Gas 

Royalty Management Act of 1982, as 

amended, 30 U.S.C. 1701–1758 

(FOGRMA), provides ONRR with 

extensive enforcement tools including, 

particularly, authority to assess civil 

penalties. See 30 U.S.C. 1719 and 1720a. 

The FCCS, at 31 CFR 900.1(a), 

acknowledges the precedence of specific 

statutes and regulations that apply to a 

particular agency’s activities. 

Public Comments: Paragraph (b) of 

this proposed section states that ONRR 

will refer debts to Treasury ‘‘within 180 

days from’’ the date the debt became 

delinquent, which the trade association 

interprets to mean that ONRR could 

refer the debt much sooner than 180 

days. The commenter believes this 

creates confusion when compared to 

paragraphs 1218.703(a)(6) and (8), 

which describe situations in which 

enforced collection can be avoided. The 

commenter also believes it creates 

confusion when read with paragraph 

1218.704(b), which says that penalties 

will not be assessed until the debt is 90 

days old, and that they will be assessed 

at the time the debt is referred to 

Treasury. The commenter states that it 

is unclear if ONRR intends to refer debts 

to Treasury before they are 90 days old. 

ONRR Response: In instances where 

other collection and enforcement efforts 

have proven unsuccessful or may not be 

economical, ONRR may refer a debt to 

Treasury for further collection efforts. 

The final rule reflects the principle that 

ONRR’s enforcement tools are not 

limited to the DCA, as amended by the 

DCIA, and the FCCS. The Treasury 

regulations implementing 31 U.S.C. 

3711 give agencies discretion to 

voluntarily refer debts that are 

delinquent for less than 180 days [31 

CFR 285.5(d)(2) and 285.12(h)]. To be 

clear, the ONRR is retaining its 

discretion in this rulemaking to refer 

debts that are less than 180 days 

delinquent. 

Our retention of that discretion does 

not conflict with § 1218.703(a)(6) and 

(8) of the proposed rule. Section 

1218.702(b) deals with referral of 

delinquent debts whereas paragraph 

(a)(6) of § 1218.703 deals with how to 

avoid delinquency and late payment 

charges. In any event, we removed 

subparagraph § 1218.703(a)(8) in the 

final rule, and, instead, revised 

subparagraph § 1218.703(b)(1) to 

address the right to appeal a notice in 

the rare instance in which the recipient 

of an ONRR notice of an intent to refer 

a debt to Treasury has not had a 

previous opportunity to appeal the 

merits of the debt, as discussed below. 


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We also do not agree that proposed 

§ 1218.702(b) created confusion with 

§ 1218.704(b). However, the point is 

moot because in this final rule we have 

decided to remove the provision in 

§ 1218.704(b) that deals with the 

assessment of penalties on delinquent 

debts under the DCA as amended by the 

DCIA. Rather, we will assess penalties at 

our discretion under our existing 

authority at 30 U.S.C. 1719. 

(4) 30 CFR 1218.703 What notice will 

ONRR give you of our intent to refer a 

matter to the Department of the 

Treasury to collect a debt? 

We did not receive any comments 

regarding this section. However, as 

discussed above, we have eliminated 

proposed subparagraph (a)(8) from this 

final rule. Subparagraph (a)(8) in the 

proposed rule stated that the notice we 

would provide of our intent to refer a 

debt would include ‘‘[y]our opportunity 

for review under 30 CFR part 1290 or 

part 1241, if any. See paragraph (b) of 

this section.’’ We removed this 

subparagraph because we added 

language to clarify that the notices 

ONRR issues under this section are not 

appealable unless the notice specifically 

gives the recipient appeal rights. This is 

because most debts we refer to Treasury 

will be ‘‘legally enforceable,’’ as 

discussed above, and, thus, would have 

already been subject to an appeal. 

However, in some instances, a party 

who is or may be secondarily liable for 

all or part of an obligation (such as a 

lessee of record under a Federal oil and 

gas lease who is not an operating rights 

holder, see 30 U.S.C. 1712(a)) may not 

have received notice of the original 

order to pay addressed to the operator 

or other royalty payor whose failure to 

pay resulted in the debt. The notice 

provided under paragraph (a) of this 

section informs the recipient that ONRR 

intends to refer a particular debt to 

Treasury, not that it has already done 

so. In instances such as those described 

here, if ONRR sends the notice of its 

intent to refer the debt to Treasury to a 

liable lessee who did not receive the 

original order (or decision on appeal or 

other notice or decision) that is the basis 

of the debt, ONRR would advise the 

lessee that it has a right to appeal under 

30 CFR part 1290. If the lessee pursues 

an appeal, ONRR would not refer it to 

Treasury to collect against that lessee 

unless and until the appeal is resolved 

against that lessee. (In the meantime, 

however, ONRR could refer to Treasury 

to collect against the operating rights 

holder or other payor who originally 

received the order and is primarily 

liable for the debt.) Thus, we have 

revised § 1218.703(b)(1) in the final rule 

to make clear that a notice is not 

appealable unless it specifically so 

states. 

The notice will inform the lessee or 

payor of the potential for collection by 

administrative offset and administrative 

costs that may be assessed against you 

under the DCA, as amended by the 

DCIA, and the FCCS. 

(5) 30 CFR 1218.704 What is ONRR’s 

policy on interest and administrative 

costs? 

Public Comments: The trade 

association noted that paragraph (b) of 

this section would impose penalties of 

6 percent per year, but the existing 

regulation at 31 CFR 901.9(d) says 

penalties are ‘‘not to exceed 6 percent.’’ 

The trade association prefers the ‘‘not to 

exceed’’ language because the 

commenter believes it would give ONRR 

the flexibility to adjust penalties based 

on the specific situation. This 

commenter also suggested that, before 

ONRR assesses a $436 administrative 

fee under paragraph (c) of this section, 

ONRR should use every means to 

resolve the debt and minimize notices of 

referral to Treasury. 

ONRR Response: Under the FCCS at 

31 CFR 901.9(d), the 6-percent penalty 

described in the proposed rule will not 

be assessed under the DCIA because, 

under FOGRMA, at 30 U.S.C. 1719 and 

1720a, penalties are ‘‘otherwise 

established * * * by statute.’’ 

Accordingly, we have revised the rule to 

state that ONRR will use its existing 

civil penalty authorities and have 

rewritten proposed paragraph (b) of this 

section to state that ‘‘ONRR will assess 

penalties under our authority in 30 

U.S.C. 1719 and 1720a, and 

implementing regulations at 30 CFR part 

1241.’’ 

In addition, we made certain changes 

to this section of the final rule for 

purposes of clarity. We added a new 

subparagraph (a)(2)(iii) to make clear 

that interest will accrue on civil 

penalties ONRR assesses under 30 CFR 

1241.71. 

We also made revisions to proposed 

paragraph (c) regarding administrative 

costs. Unlike penalties and interest, we 

are collecting fees to recover our costs 

to refer a debt under the DCIA. In 

addition, we removed proposed 

paragraph (d), which provided that 

interest, penalties, and administrative 

costs ‘‘will continue to accrue 

throughout any appeal process,’’ and 

moved a revised portion of that 

paragraph regarding administrative 

costs to paragraph (c) for two reasons. 

First, in this final rule, we removed 

references to the accrual of interest and 

penalties because interest and penalties 

will continue to accrue under the 

applicable portions of 30 CFR chapter 

XII cited in this final rule. Second, we 

added language to make clear that 

administrative costs may be assessed 

during the pendency of an appeal if the 

notice you received gave you the right 

to appeal and you exercised that right. 

Further, we clarified in paragraph (c) 

that the administrative costs that will be 

assessed during any appeal process are 

the $436 in administrative costs ONRR 

will incur if your appeal is denied and 

ONRR must refer the delinquent debt to 

Treasury. 

(6) 30 CFR 1218.705 What is ONRR’s 

policy on revoking your ability to 

engage in Federal or Indian leasing, 

licensing, or granting of easements, 

permits, or rights-of-way? 

Public Comments: This section of the 

final rule provides that the ONRR 

Director may recommend to the agency 

with responsibility for issuing leases, 

rights-of-way, easements, permits, etc., 

that a person (or entity) may have its 

ability to engage in leasing either 

suspended or revoked if it ‘‘inexcusably 

or willfully’’ fails to pay. This section of 

the proposed rule stated that the former 

MMS could revoke a debtor’s ability to 

engage in offshore leasing. However, 

ONRR is now a separate agency from the 

remainder of the former MMS [now the 

Bureau of Ocean Energy Management 

(BOEM) and Bureau of Safety and 

Environmental Enforcement (BSEE)], 

and ONRR has no authority over leasing 

either offshore or onshore. 

The trade association believes that 

ONRR should define or delete the word 

‘‘inexcusably’’ in this section because it 

is subject to interpretation. In addition, 

the commenter believes that, because 

barring a lessee from engaging in 

Federal offshore leasing, licensing, etc., 

in the event of ‘‘inexcusably or 

willfully’’ failing to pay is such a ‘‘harsh 

penalty,’’ this section should clearly 

state the lessee’s appeal rights. Further, 

the commenter believes that the lessee 

also should have the right to seek relief 

through the judicial appeals process. To 

accomplish this end, the commenter 

believes that an Assistant Secretary of 

the Department of Interior should 

decide whether to bar the debtor from 

leasing or other activities. 

Finally, the trade association states 

that, as written, the proposed rule 

provides that, when ONRR recommends 

to the leasing or regulatory agency that 

a debtor’s lease be suspended, ONRR 

will recommend that the suspension 

‘‘should only last as long as the debtor’s 

indebtedness.’’ The commenter agrees 

with that limitation but believes the 

proposed rule does not apply that 


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limitation to Federal offshore leases. 

The commenter suggests adding that the 

suspension ‘‘should only last as long as 

the debtor’s indebtedness’’ to the first 

sentence of § 1218.705. 

ONRR Response: We are declining the 

commenter’s suggestion that we should 

define ‘‘inexcusably.’’ Whether a 

particular failure to pay or series of 

failures to pay is sufficiently 

inexcusable as to warrant a 

recommendation of debarment from 

leasing depends on the particular 

circumstances, and it is difficult to 

formulate a single definition that would 

adequately anticipate all such 

situations. Each situation will have to be 

considered on a case-by-case basis. 

Moreover, we disagree with the 

commenter’s suggestion that we add 

appeal rights regarding the Director’s 

recommendation to the leasing or 

regulatory agency to revoke a lessee’s 

ability to obtain a lease, license, etc. in 

this rulemaking. The Director’s 

recommendation in this rulemaking 

constitutes only a recommendation to 

the leasing or regulatory agency with 

authority to actually revoke, not the 

actual revocation. Moreover, § 1218.705 

does not itself constitute debarment 

authority. The extent to which the 

leasing or regulatory agency possesses 

debarment authority is a function of the 

statutes and regulations those agencies 

administer, not of ONRR rules. 

However, if the leasing or regulatory 

agency refuses to issue a company a 

lease, permit, license, etc., based on 

ONRR’s recommendation, then that 

decision may or may not be appealable 

under the particular bureau’s 

regulations. Therefore, we are not 

adding appeal rights in this rulemaking 

for internal bureau-to-bureau 

communications. 

Furthermore, as discussed above, in 

this final rule, we are removing 

references to specific leasing or 

regulatory agencies that were in the 

proposed rule both in this section and 

the definitions section. Although the 

names of BIA and BLM remain the 

same, the former Bureau of Ocean 

Energy Management, Regulation and 

Enforcement is now two separate 

organizations—BOEM and BSEE. The 

intent of this rule is to make such 

referrals to the appropriate leasing or 

regulatory agency within the 

Department regardless of that entity’s 

name. 

Finally, we also disagree with the 

commenter’s suggestion that we should 

add the phrase ‘‘should only last as long 

as the debtor’s indebtedness’’ to the first 

sentence of proposed § 1218.705. That 

section, as rewritten in plain English in 

this final rule states that the Director 

may recommend that the leasing or 

issuing agency, under statutory or 

regulatory authority applicable to that 

agency, revoke your ability to engage in 

Federal or Indian leasing, licensing, or 

granting of easements, permits, or 

rights-of-way if you inexcusably or 

willfully fail to pay a debt. The Director 

will recommend that revocation of your 

ability to engage in Federal or Indian 

leasing, licensing, or granting of 

easements, permits, or rights-of-way 

should last only as long as your debt 

remains unpaid or unresolved. 

For clarity, we removed the word 

‘‘onshore’’ in the first sentence to make 

it clear that the Director’s 

recommendation may apply to any 

Federal or Indian leases. We are not 

adding the additional language to the 

first sentence because the second 

sentence of that section already contains 

the limitation the commenter suggests. 

III. Procedural Matters 

1. Summary Cost and Royalty Impact 

Data 

This is a technical rule formalizing 

and enhancing current ONRR debt 

collection practices and procedures 

consistent with the statutory mandates 

under the DCA and DCIA. The changes 

explained above will have no royalty 

impacts on industry, state and local 

governments, Indian tribes and 

individual Indian mineral owners, and 

the Federal Government. Industry will 

incur additional administrative costs 

under this rulemaking. 

A. Industry 

(1) Royalty Impacts. None. 

(2) Administrative Costs. The ONRR 

will assess $436 for recovery of 

administrative costs for each referral of 

debt to Treasury. We calculated the 

$436 administrative costs based on our 

estimate of the average actual costs we 

incur to refer debts to Treasury. 

(3) Penalties. The ONRR will assess 

penalties under existing authority at 30 

U.S.C. 1719 and 1720a and 30 CFR part 

1241. This final rule therefore will have 

no impact on penalties. 

B. State and Local Governments 

(1) Royalty Impacts. None. 

(2) Administrative Costs—State and 

Local Governments. The ONRR 

determined that this rule will have no 

administrative costs for state and local 

governments. 

(3) Penalties. None. 

C. Indian Tribes and Individual Indian 

Mineral Owners 

(1) Royalty Impacts. None. 

(2) Administrative Costs. The ONRR 

determined that this rule will have no 

administrative costs to Indian tribes and 

individual Indian mineral owners. 

(3) Penalties. None. 

D. Federal Government 

(1) Royalty Impacts. None. 

(2) Administrative Costs. The rule will 

have insignificant or no net 

administrative costs to the Federal 

Government. The final rule provides for 

a fee that we will recover from industry 

for administrative costs to the 

Government incurred as a result of 

collection activities. 

(3) Penalties. None. 

2. Regulatory Planning and Review 

(Executive Orders 12866 and 13563) 

Executive Order 12866 provides that 

the Office of Information and Regulatory 

Affairs (OIRA) will review all significant 

rules. The Office of Information and 

Regulatory Affairs has determined that 

this rule is not significant. 

Executive Order 13563 reaffirms the 

principles of Executive Order 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. Executive 

Order 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. Executive Order 13563 

emphasizes further 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. 

3. Regulatory Flexibility Act. 

The Department of the Interior 

certifies that this rule will not have a 

significant economic effect on a 

substantial number of small entities 

under the Regulatory Flexibility Act (5 

U.S.C. 601 et seq.). This rule will affect 

large and small entities but will not 

have a significant economic effect on 

either. Based on historical data, we 

estimate that the rule will affect 

approximately 85 small entities per 

year. 

4. Small Business Regulatory 

Enforcement Fairness Act (SBREFA) 

This rule is not a major rule under 5 

U.S.C. 804(2), the Small Business 

Regulatory Enforcement Fairness Act. 

This rule: 

a. Does not have an annual effect on 

the economy of $100 million or more. 


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This is a technical rule formalizing and 

enhancing current ONRR debt collection 

practices and procedures consistent 

with the statutory mandates under the 

DCA and DCIA. Industry will incur fees 

for administrative costs for failure to 

pay a delinquent debt to the Federal 

Government. Industry may avoid these 

administrative costs by accurately and 

timely paying debts owed to the Federal 

Government. 

b. Will not cause a major increase in 

costs or prices for consumers, 

individual industries, Federal, state, or 

local government agencies, or 

geographic regions. 

c. 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. 

5. 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. This 

rule will not have a significant or 

unique effect on state, local, or tribal 

governments, or the private sector. A 

statement containing the information 

required by the Unfunded Mandates 

Reform Act (2 U.S.C. 1531 et seq.) is not 

required. 

This is a technical rule formalizing 

and enhancing current ONRR debt 

collection practices and procedures 

consistent with the statutory mandates 

under the DCA and DCIA. Under this 

rule, ONRR will impose fees to cover 

the administrative costs of recovering 

delinquent debts. Recovery of 

administrative costs is consistent with 

the DCA, DCIA, and 31 U.S.C. 9701. 

6. Takings (Executive Order 12630) 

Under the criteria in Executive Order 

12630, this rule does not have any 

significant takings implications. This 

rule will apply to Federal and Indian 

leases only. It will not apply to private 

property. A takings implication 

assessment is not required. 

7. Federalism (Executive Order 13132) 

Under the criteria in Executive Order 

13132, this rule does not have sufficient 

federalism implications to warrant the 

preparation of a Federalism Assessment. 

This is a technical rule formalizing and 

enhancing current ONRR debt collection 

practices and procedures. A Federalism 

Assessment is not required. 

8. Civil Justice Reform (Executive Order 

12988) 

This rule complies with the 

requirements of Executive Order 12988. 

Specifically, this rule: 

a. 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 

b. Meets the criteria of section 3(b)(2) 

requiring that all regulations be written 

in clear language and contain clear legal 

standards. 

9. Consultation With Indian Tribes 

(Executive Order 13175) 

Under the criteria in Executive Order 

13175, we have evaluated this rule and 

determined that it will have no potential 

effects on federally recognized Indian 

tribes. 

10. Paperwork Reduction Act 

This rule does not contain 

information collection requirements, 

and a submission to OMB is not 

required under the Paperwork 

Reduction Act of 1995 (44 U.S.C. 3501 

et seq.). 

11. 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 this rule 

is categorically excluded under: ‘‘(i) 

Policies, directives, regulations, and 

guidelines: that are of an administrative, 

financial, legal, technical, or procedural 

nature.’’ See 43 CFR 46.210(i) and the 

DOI Departmental Manual, part 516, 

section 15.4.D. We have also determined 

that this rule is not involved in any of 

the extraordinary circumstances listed 

in 43 CFR 46.215 that would require 

further analysis under NEPA. The 

procedural changes resulting from these 

amendments will have no consequences 

with respect to the physical 

environment. This rule will not alter in 

any material way natural resource 

exploration, production, or 

transportation. 

12. Data Quality Act 

In developing this rule, we did not 

conduct or use a study, experiment, or 

survey requiring peer review under the 

Data Quality Act (Pub. L. 106–554), also 

known as the Information Quality Act. 

The Department of the Interior has 

issued guidance regarding the quality of 

information that it relies on for 

regulatory decisions. This guidance is 

available on DOI’s Web site at http:// 

www.doi.gov/ocio/iq.html. 

13. Effects on the Energy Supply 

(Executive Order 13211) 

This rule is not a significant energy 

action under the definition in Executive 

Order 13211. A Statement of Energy 

Effects is not required. 

List of Subjects in 30 CFR Part 1218 

Administrative offset, Administrative 

practice and procedure, Bonuses, 

Collections, Debt, Federal and Indian 

mineral leases, Royalties, Rentals. 

Dated: April 19, 2012. 

Amy Holley, 

Acting Assistant Secretary for Policy, 

Management and Budget. 

For the reasons stated in the 

preamble, the Office of Natural 

Resources Revenue amends 30 CFR part 

1218 as set forth below: 

PART 1218—COLLECTION OF 

ROYALTIES, RENTALS, BONUSES, 

AND OTHER MONIES DUE THE 

FEDERAL GOVERNMENT 

■ 1. Revise the authority citation for part 

1218 to read as follows: 

Authority: 5 U.S.C. 301 et seq.; 25 U.S.C. 

396 et seq., 396a et seq., 2101 et seq.; 30 

U.S.C. 181 et seq., 351 et seq., 1001 et seq., 

1701 et seq.; 31 U.S.C. 3335, 3711, 3716–18, 

3720A, 9701; 43 U.S.C. 1301 et seq., 1331 et 

seq., and 1801 et seq. 

Subpart I—[Added and Reserved] 

■ 2. Add and reserve subpart I. 

■ 3. Add subpart J to read as follows: 

Subpart J—Debt Collection and 

Administrative Offset 

Sec. 

1218.700 What definitions apply to the 

regulations in this subpart? 

1218.701 What is ONRR’s authority to issue 

these regulations? 

1218.702 What happens to delinquent debts 

you owe ONRR? 

1218.703 What notice will ONRR give you 

of our intent to refer a matter to Treasury 

to collect a debt? 

1218.704 What is ONRR’s policy on interest 

and administrative costs? 

1218.705 What is ONRR’s policy on 

recommending revocation of your ability 

to engage in Federal or Indian leasing, 

licensing, or granting of easements, 

permits, or rights-of-way? 

1218.706 What debts may ONRR refer to 

Treasury to collect by administrative 

offset or tax refund offset? 

Subpart J—Debt Collection and 

Administrative Offset 

§ 1218.700 What definitions apply to the 

regulations in this subpart? 

As used in this subpart: 

Administrative offset means the 

withholding of funds payable by the 

United States (including funds payable 

by the United States on behalf of a state 

government) to any person, or the 

withholding of funds held by the United 


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25888 Federal Register / Vol. 77, No. 85 / Wednesday, May 2, 2012 / Rules and Regulations 

States for any person, in order to satisfy 

a debt owed to the United States. 

Agency means a department, agency, 

court, court administrative office, or 

instrumentality in the executive, 

judicial, or legislative branch of 

government, including a government 

corporation. 

Day means calendar day. To count 

days, include the last day of the period 

unless it is a Saturday, Sunday, or 

Federal legal holiday. 

Debt and claim are synonymous and 

interchangeable. They refer to, among 

other things, royalties, rentals, and any 

other monies due to, or collectible by, 

the United States as well as fines, fees, 

assessments, penalties, and any other 

monies that have been determined to be 

legally enforceable and due to the 

United States from any person, 

organization, or entity, except another 

Federal agency. For the purposes of 

administrative offset under 31 U.S.C. 

3716 and this subpart, the terms ‘‘debt’’ 

and ‘‘claims’’ include money, funds, or 

property owed to, or collectible by, the 

United States. 

Debtor means a lessee, payor, or other 

person that owes a debt to the United 

States or ONRR, or from whom ONRR 

collects debts on behalf of the United 

States, the Department, or an Indian 

lessor. 

Delinquent or past due refers to the 

status of a debt and means a debt that 

is legally enforceable and has not been 

paid within the time limit prescribed by 

the applicable act, law, regulation, lease, 

order, demand, notice of 

noncompliance, and/or assessment of 

civil penalties, contract, decision, or any 

other agreement. 

Department means the Department of 

the Interior, and any of its bureaus or 

offices. 

Director means the Director of the 

Office of Natural Resources Revenue, or 

his or her designee. 

DOJ means the U.S. Department of 

Justice. 

FCCS means the Federal Claims 

Collection Standards, which are 

published at 31 CFR parts 900 through 

904. 

FMS means the Financial 

Management Service, a bureau of the 

U.S. Department of the Treasury. 

Lease means any contract, profit-share 

arrangement, joint venture, or other 

agreement issued or approved by the 

United States under any statutory 

authority including, but not limited to, 

a mineral leasing law that authorizes 

exploration for and development or 

extraction of oil, gas, coal, any other 

mineral or geothermal resources, or 

power generation from renewable 

energy sources, on Federal or Indian 

tribal or allotted lands or the Outer 

Continental Shelf. Depending on the 

context, lease may also refer to the land 

area covered by that authorization. 

Legally enforceable means that there 

has been a final non-appealable agency 

determination that the debt, in the 

amount stated, is due, and there are no 

legal bars to collection by offset. 

Lessee means any person to whom the 

United States or an Indian tribe or 

individual Indian mineral owner issues 

a Federal or Indian mineral or other 

resource lease, easement, right-of-way, 

or other agreement, an assignee of all or 

a part of the record title interest, or any 

person to whom operating rights have 

been assigned. 

ONRR means the Office of Natural 

Resources Revenue, an office of the 

Department. 

Other agreement means any 

agreement other than a lease and 

includes, but is not limited to, any 

agreement between you and the 

Department to pay the Department 

money, funds, or property, regardless of 

form. 

Past due has the same meaning as 

‘‘delinquent’’ as defined above. 

Payor means any person who reports 

and pays royalties under a lease, 

regardless of whether that person is also 

a lessee. 

Person includes a natural person or 

persons, profit or nonprofit corporation, 

partnership, association, limited 

liability company, trust, estate, 

consortium, or other entity that owes a 

debt to the United States. 

Tax refund offset means the reduction 

of a tax refund by the amount of a pastdue, legally enforceable debt. 

You and your refer to the debtor. 

§ 1218.701 What is ONRR’s authority to 

issue these regulations? 

(a) The ONRR is issuing the 

regulations in this subpart under the 

authority of the FCCS, the Debt 

Collection Act of 1982, and the Debt 

Collection Improvement Act of 1996, 31 

U.S.C. 3711, 3716–3718, and 3720A. 

(b) The regulations in this subpart 

adopt and supplement the FCCS as 

necessary. 

§ 1218.702 What happens to delinquent 

debts you owe ONRR? 

(a) The ONRR will collect debts from 

you under the regulations in this 

subpart in addition to other applicable 

statutory and regulatory authorities. 

(b) The ONRR will transfer to the U.S. 

Department of the Treasury any past 

due, legally enforceable nontax debt that 

is delinquent within 180 days from the 

date the debt becomes delinquent so 

that Treasury may take appropriate 

action to collect the debt or terminate 

the collection action under 26 U.S.C. 

6402(d)(1) and (2); 31 U.S.C. 3711, 3716, 

and 3720A; the FCCS; and 31 CFR 285.2 

and 285.5. 

§ 1218.703 What notice will ONRR give you 

of our intent to refer a matter to Treasury 

to collect a debt? 

(a) When the Director determines that 

you owe, or may owe, a legally 

enforceable debt to ONRR, the Director 

will send a written notice to you 

informing you that ONRR intends to 

refer the debt to Treasury. We will send 

the notice by facsimile or mail to the 

most current address known to us. The 

notice will inform you of the following: 

(1) The amount, nature, and basis of 

the debt. 

(2) The methods of offset that ONRR 

or Treasury may use. 

(3) Your opportunity to inspect and 

copy agency records related to the debt. 

(4) Your opportunity to enter into a 

written agreement with us to repay the 

debt. 

(5) Our policy concerning interest and 

administrative costs under § 1218.704, 

including a statement that we will make 

such assessments against you unless we 

determine otherwise under the criteria 

of the FCCS and this part. 

(6) The date by which you must remit 

payment to avoid additional late charges 

and enforced collection. 

(7) The name, address, and telephone 

number of a contact person (or office) at 

ONRR who is available to discuss your 

debt. 

(b)(1) You may not appeal the notice 

issued under this section unless the 

notice specifically provides you with 

the opportunity for review under 30 

CFR parts 1290 or 1241 because you did 

not previously receive a notice of the 

order, decision on appeal, or any other 

notice or decision that is the basis of the 

debt that ONRR intends to refer to 

Treasury, and for which you may be 

liable in whole or in part under 

applicable law. You may not dispute 

matters related to your delinquent debt 

that were the subject of a final order or 

appeal decision of which you were the 

recipient, or to which you were a party 

that is the basis of your delinquent debt. 

(2) This section applies whether or 

not you appealed the order, demand, 

notice of noncompliance, or assessment 

of civil penalties under 30 CFR parts 

1290 or 1241. 

§ 1218.704 What is ONRR’s policy on 

interest and administrative costs? 

(a) Interest. (1) The ONRR will assess 

interest on all delinquent debts as 

prescribed by applicable statutes and 

regulations. 


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(i) Interest will accrue on debts 

involving Federal and Indian oil and gas 

leases under 30 CFR 1218.54, 1218.102, 

and 1218.150. 

(ii) Interest will accrue on debts 

involving Federal and Indian solid 

mineral and geothermal resource leases 

under 30 CFR 1218.202 and 1218.302. 

(iii) Interest will accrue on civil 

penalties ONRR assesses under 30 CFR 

part 1241. 

(2) Interest begins to accrue on all 

debts from the date that the payment 

was due unless otherwise specified by 

law or lease terms. 

(b) Penalties. The ONRR will assess 

penalties under our authority in 30 

U.S.C. 1719 and 1720a, and 

implementing regulations at 30 CFR part 

1241. 

(c) Administrative costs. The ONRR 

initially will assess $436 for 

administrative costs incurred as a result 

of your failure to pay a delinquent debt. 

We will publish a notice of any increase 

in administrative costs assessed under 

this section in the Federal Register. The 

ONRR also may assess $436 for 

administrative costs that continue to 

accrue during any appeal process if: 

(1) The notice we provide you under 

30 CFR 1218.703 grants you the right to 

appeal and you exercise that right; and 

(2) Your appeal is denied and we refer 

the delinquent debt to Treasury under 

this subpart. 

(d) Allocation of payments. The 

ONRR will apply a partial or installment 

payment you make on a delinquent debt 

sent to Treasury, first to outstanding 

penalty assessments, second to 

administrative costs, third to accrued 

interest, and fourth to the outstanding 

debt principal. 

(e) Additional authority. The ONRR 

may assess interest, penalty charges, 

and administrative costs on debts that 

are not subject to 31 U.S.C. 3717 to the 

extent authorized under common law or 

other applicable statutory or regulatory 

authority. 

(f) Waiver. The Director may decide to 

waive collection of all or part of the 

administrative costs under paragraph (c) 

of this section either in compromise of 

the delinquent debt or if the Director 

determines collection of this charge 

would be against equity and good 

conscience or not in the Government’s 

best interest. 

(g) The ONRR’s decision whether to 

collect or waive collection of 

administrative costs under paragraph (f) 

of this section is the final decision for 

the Department and is not subject to 

administrative review. 

§ 1218.705 What is ONRR’s policy on 

recommending revocation of your ability to 

engage in Federal or Indian leasing, 

licensing, or granting of easements, 

permits, or rights-of-way? 

The Director may recommend that the 

leasing or issuing agency, under 

statutory or regulatory authority 

applicable to that agency, revoke your 

ability to engage in Federal or Indian 

leasing, licensing, or granting of 

easements, permits, or rights-of-way if 

you inexcusably or willfully fail to pay 

a debt. The Director will recommend 

that any revocation of your ability to 

engage in Federal or Indian leasing, 

licensing, or granting of easements, 

permits, or rights-of-way should last 

only as long as your debt remains 

unpaid or unresolved. 

§ 1218.706 What debts may ONRR refer to 

Treasury to collect by administrative offset 

or tax refund offset? 

(a) The ONRR may refer any past due, 

legally enforceable debt you owe to 

ONRR to Treasury to collect through 

administrative offset or tax refund offset 

at least 60 days after we give you notice 

under 30 CFR 1218.703 if the debt: 

(1) Is at least $25.00 or another 

amount established by Treasury; and 

(2) Does not involve Federal oil and 

gas lease obligations for which offset is 

precluded under 30 U.S.C. 1724(b)(3). 

(b) The ONRR may refer debts 

reduced to judgment to Treasury for tax 

refund offset at any time. 

[FR Doc. 2012–10361 Filed 5–1–12; 8:45 am] 

BILLING CODE 4310–T2–P 

DEPARTMENT OF HOMELAND 

SECURITY 

Coast Guard 

33 CFR Part 117 

[Docket No. USCG–2012–0305] 

Drawbridge Operation Regulations; 

Niantic River, Niantic, CT 

AGENCY: Coast Guard, DHS. 

ACTION: Notice of temporary deviation 

from regulations. 

SUMMARY: The Commander, First Coast 

Guard District, has issued a temporary 

deviation from the regulation governing 

the operation of the Amtrak Railroad 

Bridge across the Niantic River, mile 

0.0, at Niantic, Connecticut. The 

deviation allows the bridge to remain in 

the closed position for 20 nights to 

facilitate completion of work on 

machinery and the lift span. 

DATES: This deviation is effective from 

May 15, 2012 through August 15, 2012. 

ADDRESSES: Documents mentioned in 

this preamble as being available in the 

docket are part of docket USCG–2012– 

0305 and are available online at 

www.regulations.gov, inserting USCG– 

2012–0305 in the ‘‘Keyword’’ and then 

clicking ‘‘Search’’. They are also 

available for inspection or copying at 

the Docket Management Facility (M–30), 

U.S. Department of Transportation, 

West Building Ground Floor, Room 

W12–140, 1200 New Jersey Avenue SE., 

Washington, DC 20590, between 9 a.m. 

and 5 p.m., Monday through Friday, 

except Federal holidays. 

FOR FURTHER INFORMATION CONTACT: If 

you have questions on this rule, call or 

email Ms. Judy Leung-Yee, Project 

Officer, First Coast Guard District, 

telephone (212) 668–7165, email 

judy.k.leung-yee@uscg.mil. If you have 

questions on viewing the docket, call 

Renee V. Wright, Program Manager, 

Docket Operations, telephone 202–366– 

9826. 

SUPPLEMENTARY INFORMATION: The 

Amtrak Railroad Bridge, across the 

Niantic River, mile 0.0, at Niantic, 

Connecticut, has a vertical clearance in 

the closed position of 16 feet at mean 

high water. The drawbridge operation 

regulations are listed at 33 CFR 

117.215(a). 

The operator of the bridge, National 

Passenger Railroad Corporation 

(Amtrak), requested a temporary 

deviation from the regulations to 

facilitate completion of machinery 

installation and lift span work at the 

new Niantic River RR Bridge. To 

facilitate completion of the work at the 

new bridge, Amtrak has requested a 

total of 20 nighttime closures between 

11 p.m. through 6 a.m., Monday through 

Thursday, beginning May 15, 2012 until 

August 15, 2012. 

The waterway users are recreational 

vessels and seasonal fishing boats. 

Under this temporary deviation the 

Amtrak Railroad Bridge may remain in 

the closed position during the hours of 

11 p.m. until 6 a.m., Monday through 

Thursday, beginning May 15, 2012 until 

August 15, 2012. The Amtrak Railroad 

Bridge will require 20 nighttime 

closures during this period. The exact 

calendar dates for the closures have not 

been established due to other related 

construction at the bridge. The exact 

closure dates will be published in the 

Local Notice to Mariners one week in 

advance of the closures. 

Vessels that can pass under the bridge 

in the closed position may do so at all 

times. 

The waterway users were advised of 

the requested bridge closure and offered 

no objection. 


emcdonald on DSK29S0YB1PROD with RULES