This section of the FEDERAL REGISTER

contains regulatory documents having general

applicability and legal effect, most of which

are keyed to and codified in the Code of

Federal Regulations, which is published under

50 titles pursuant to 44 U.S.C. 1510.

The Code of Federal Regulations is sold by

the Superintendent of Documents. Prices of

new books are listed in the first FEDERAL

REGISTER issue of each week.

Rules and Regulations Federal Register

31787

Vol. 65, No. 98

Friday, May 19, 2000

FEDERAL ELECTION COMMISSION

11 CFR Parts 104 and 111

[Notice 2000–10]

Administrative Fines

AGENCY: Federal Election Commission.

ACTION: Final Rule; transmittal of

regulations to Congress.

SUMMARY: The Treasury and General

Government Appropriations Act, 2000,

amended the Federal Election Campaign

Act of 1971 (hereinafter ‘‘the Act’’ or

‘‘FECA’’) to permit the Federal Election

Commission to impose civil money

penalties for violations of the reporting

requirements of the FECA that occur

between January 1, 2000, and December

31, 2001. The amendments are intended

to expedite and streamline the

Commission’s enforcement procedures.

The Commission is promulgating

amendments to its compliance

procedure regulations to implement the

new program. Further information is

provided in the supplementary

information that follows.

EFFECTIVE DATE: July 14, 2000. The

Commission transmitted the final rules

and the Explanation and Justification to

Congress pursuant to 2 U.S.C. 438(d) on

May 12, 2000. The Commission

anticipates that 30 legislative days will

elapse by the effective date.

FOR FURTHER INFORMATION CONTACT: Ms.

Rosemary C. Smith, Assistant General

Counsel, or Ms. Mai T. Dinh, Staff

Attorney, 999 E Street, N.W.,

Washington, D.C. 20463, (202) 694–1650

or (800) 424–9530.

SUPPLEMENTARY INFORMATION: The

Commission is issuing final rules to

establish the administrative fines

program that Congress authorized in

amendments to section 309(a)(4) of the

FECA, 2 U.S.C. 437g(a)(4). These

amendments were enacted as part of the

Treasury and General Government

Appropriations Act, 2000, Public Law

106–58, 106th Cong., Section 640, 113

Stat. 430, 476–77 (1999). Under 2 U.S.C.

434, treasurers of political committees

are required to file reports periodically

to the Commission by a certain

deadline. Prior to enactment of the

amendment to the FECA, the

Commission handled failures to file the

reports in a timely manner under the

enforcement procedures in 11 CFR part

111. The purpose of the administrative

fines program is to institute streamlined

procedures, while preserving the

respondents’ due process rights, to

process violations of the reporting

requirements of 2 U.S.C. 434(a) and

assess a civil money penalty based on

the schedules of penalties for such

violations. The final rules include new

subpart B of 11 CFR part 111, and

technical amendments to 11 CFR 104.5,

111.8, 111.20, and 111.24 to implement

the administrative fines program.

Section 438(d) of Title 2, United

States Code, requires that any rule or

regulation prescribed by the

Commission to carry out the provisions

of Title 2 of the United States Code be

transmitted to the Speaker of the House

of Representatives and the President of

the Senate 30 legislative days before

they are finally promulgated. These

regulations were transmitted to

Congress on May 12, 2000.

Explanation and Justification

The Commission initiated this

rulemaking by issuing a Notice of

Proposed Rulemaking (NPRM) on March

29, 2000, in which it sought comments

to the proposed rule. 65 FR 16534

(March 29, 2000). The comment period

ended on April 28, 2000. The

Commission received one comment in

response to the NPRM from Akin,

Gump, Strauss, Hauer & Feld. The

comment included a request for a public

hearing. Because Congress intended for

this new program to apply to violations

that occur in 2000 and 2001, the final

rules need to be issued in a timely

manner so that the program will be

applicable to the reports that are due in

2000. Holding a public hearing would

postpone publication of the final rules

and delay the effective date, possibly

until February or March, 2001. This late

effective date would allow the

Commission to apply the administrative

fines procedure to only one major

reporting period—the 2001 Mid-Year

Report. This would not give the

Commission a sufficient basis to

determine whether to recommend that

Congress make the program permanent.

Also, the Commission received only one

request for a public hearing and that

requester did submit extensive

comments. Therefore, the Commission

will not hold a public hearing on this

final rule.

General Comments

The commenter’s overriding concern

was that the proposed procedures do

not afford adequate procedural due

process and therefore, violate the Fifth

Amendment’s Due Process Clause of the

U.S. Constitution. The commenter

argued that the procedures do not meet

the balancing test in Mathews v.

Eldridge, 424 U.S. 319 (1976), by failing

to recognize the respondents’ private

interests, by minimizing the potential

risk of erroneous result, and by placing

undue emphasis on administrative

expediency. The commenter claimed

that the potential risk of erroneous

result is high because the civil money

penalty calculation includes three

factors that could be misapplied and

because the advent of mandatory

electronic filing could flood the

Commission’s computers and lead to a

breakdown that would unfairly penalize

the respondents.

The Commission disagrees with this

assessment. The Commission does

recognize that the respondents have a

property interest at stake. Except for

political committees with low levels of

financial activity during the reporting

period, the civil money penalty will not

exceed fifteen percent of the level of

activity in the report for respondents

who have no previous violations. For

committees whose financial activity is

less than $25,000 and who do not have

a previous violation, the civil money

penalty will not exceed $1000 or the

level of activity, whichever is less.

Thus, the cost of additional procedures

such as a hearing for the respondent as

well as the Commission will exceed the

benefit of having them. Also, the

Mathews balancing test considers

whether additional procedures will

provide greater protection against

deprivation of a property interest or

error. Within the administrative fines

program, additional procedures in most

cases will not afford the respondents

greater protection against either. As

31788 Federal Register / Vol. 65, No. 98 / Friday, May 19, 2000 / Rules and Regulations

stated in the NPRM, the factual and

legal issues involved in violations of the

reporting requirements of 2 U.S.C.

434(a) are relatively straightforward.

The Commission will carefully review

the facts and its records before it will

even proceed with a reason to believe

finding. For the most part, the factual

disputes surrounding this type of

violation are whether the respondent

filed the report and when the report was

filed. If the respondent disagrees with

the facts in the notification of the reason

to believe finding, he or she can send

proof of the filing and the date of the

filing. The Commission expects that the

reviewing officer will be able to resolve

these types of factual disputes based on

the written submissions.

The Commission also disagrees with

the commenter’s assertion that the

procedures set forth in the NPRM pose

a large potential risk of erroneous result.

The civil money penalty calculation is

a simple arithmetic formula whereby an

error can be readily corrected by the

Commission or the reviewing officer

when it is brought to their attention. It

is premature to predict the impact of

mandatory electronic filing on

administrative fines. It will have no real

effect on the administrative fines

program during the year 2000 because

mandatory electronic filing is not

scheduled to begin until January, 2001.

Given that most committees will file

only two reports during 2001 (2000 Year

End and 2001 Mid-Year reports) before

the administrative fines program sunsets

on December 31, 2001, the impact is

likely to be minimal, if any. The

Commission’s electronic filing system

has been designed to accommodate

filings by all committees that will be

mandated to file electronically in 2001.

As a result, there is no expectation that

the system will have an adverse impact

on the ability of committees to file their

reports in a timely manner. In fact,

committees may find that electronic

filing is easier, faster, and more

convenient than paper filing.

Nevertheless, any failure of the

Commission’s system that prevents

committees from filing their reports

when due would be recognized by the

Commission as a circumstance beyond

the control of the filer and would be

taken into account when considering

reason to believe findings or the final

determination.

The Commission recognizes that the

need to avoid administrative burdens is

one of the stated purposes for the

amendment to the FECA. Congressman

William Thomas, Chairman of the

Committee of House Administration,

stated the following on the floor of the

House of Representatives on September

15, 1999:

Allowing the FEC to impose administrative

fines for reporting violations without the

lengthy procedural steps required in a

normal enforcement case will free critical

FEC resources for more important disclosure

and enforcement efforts. The rights of those

under these regulations are protected by

preserving the option of appeal to a U.S.

District Court for those who believe the FEC

erred.

The Commission, however, disagrees

with the commenter that the proposed

rule sacrifices the respondents’ rights

and procedural due process in the

interest of administrative efficiency. The

Commission applied the Mathews

balancing test in developing the

administrative fines procedures, taking

into consideration the private interests

involved and the nature of the violation.

The Commission believes that the

procedures in the final rules more than

adequately meet the Mathews test in

providing the respondents with

procedural due process.

Section 104.5 Filing Dates

Paragraph (i) is being added to section

104.5 to encourage political committees

to keep proof that they filed their

reports and the dates on which the

reports were filed. Retaining this

evidence will allow a respondent to

demonstrate timely filing if the

respondent disagrees with the

Commission on whether the report was

filed and if so, the date of the filing. No

substantive comments were made

concerning this proposed section.

Section 111.8 Internally Generated

Matters; Referrals

Paragraph (d) is being added to

section 111.8 to permit the Commission

to process complaint-generated matters

that allege violations of the reporting

requirements of 2 U.S.C. 434(a) under

the administrative fines program. The

Commission received no substantive

comment on this section.

Section 111.20 Public Disclosure of

Commission Action

New paragraph (c) in section 111.20 is

being added to provide for the public

disclosure of the enforcement file once

the matter is completely resolved. The

Commission did not receive any

substantive comments to this section.

Section 111.24 Civil Penalties

Revised paragraph (a) of section

111.24 allows for the imposition of civil

money penalties so as to make section

111.24 consistent with 11 CFR part 111,

subpart B. The Commission did not

receive any substantive comments on

this section.

Section 111.30 When Will Subpart B

Apply?

The amendment to FECA authorizes

the administrative fines procedures for

violations of the reporting requirements

of 2 U.S.C. 434(a) that occur between

January 1, 2000 and December 31, 2001.

Therefore, this section provides that

subpart B only applies to violations that

occur during that time frame and

subpart B sunsets as of January 1, 2002.

The Commission did not receive any

substantive comments on this section.

Section 111.31 Does This Subpart

Replace Subpart A of This Part for

Violations of the Reporting

Requirements of 2 U.S.C. 434(a)?

Under the amendment to FECA, the

Commission has discretion to apply

either the administrative fines

procedures or the current enforcement

procedures set forth in §§ 111.9 through

111.19 to violations of the reporting

requirements of 2 U.S.C. 434(a). The

amendment, however, still requires the

Commission to find reason to believe

that a violation has occurred prior to

making a final determination. Thus,

§§ 111.1 through 111.8, which include

the Commission’s reason to believe

procedures, will apply to violations

processed through the administrative

fines procedures. Please note that under

2 U.S.C. 437g(b), the Commission will

continue to publish the names of

political committees that fail to file their

reports when due in the calendar

quarter preceding an election including

pre-election reports if the committees do

not respond within four business days

of being notified by the Commission of

their failure to file. Sections 111.20

through 111.24, which pertain to public

disclosure, confidentiality, ex parte

communications, representation by

counsel, and civil penalties, will also

apply to violations processed under

subpart B. In addition, while the

Commission anticipates that it will

process most of these violations under

the administrative fines procedures,

§ 111.31 makes clear that the

Commission has the discretion to use

the enforcement procedures in §§ 111.9

through 111.19 to handle these

violations in circumstances the

Commission deems appropriate.

Proposed § 111.31(b) is being

modified to include complaintgenerated matters that allege violations

of the reporting requirements of 2 U.S.C.

434(a) along with violations of other

provisions of the FECA in the

administrative fines program. The

alleged violations of the reporting

Federal Register / Vol. 65, No. 98 / Friday, May 19, 2000 / Rules and Regulations 31789

requirements will be processed through

subpart B while the other alleged

violations will be handled through the

enforcement process of subpart A. The

Commission made this modification to

maintain consistency in its prosecution

of alleged violations of the reporting

requirement of 2 U.S.C. 434(a). The

Commission did not receive any

substantive comments on this section.

Section 111.32 How Will the

Commission Notify Respondents of a

Reason To Believe Finding and a

Proposed Civil Money Penalty?

The Commission will follow its

current procedures in finding reason to

believe and in notifying the respondents

of its finding. If the Commission, by an

affirmative vote of at least four of its

members, finds reason to believe that a

violation has occurred, the Chairman or

the Vice-Chairman will notify the

respondent of the finding. The

notification will include the legal and

factual basis for the finding as well as

the proposed civil money penalty in

accordance with the schedules of

penalties and an explanation of the

respondent’s right to challenge the

finding and/or the proposed civil money

penalty.

As stated in the NPRM, the

Commission will also continue to follow

its current procedure of notifying the

political committees of their duty to file

their reports and the dates on which the

reports are due prior to the filing

deadline. Thus, political committees

will continue to be on notice of their

legal obligation to file their reports in a

timely manner.

The commenter urged that the

Commission include a regulation stating

when a report filed electronically is

considered ‘‘filed.’’ The Commission

agrees that the regulations should

include such a provision but has

decided that this topic is better

addressed in the Commission’s

rulemaking regarding mandatory

electronic filing.

Section 111.33 What Are the

Respondent’s Choices Upon Receiving

the Reason To Believe Finding and the

Proposed Civil Money Penalty?

Upon receipt of the notification of the

reason to believe finding and the

proposed civil money penalty, the

respondents will have two options.

They may pay the civil money penalties

pursuant to § 111.34. The Commission

will process the payment and then close

the matter. Respondents may also

challenge the reason to believe finding

and/or the proposed civil money

penalty by following the procedures set

forth in § 111.35. The Commission did

not receive any substantive comments

on this section.

Section 111.34 If the Respondent

Decides To Pay the Civil Money Penalty

and Not To Challenge the Reason To

Believe Finding, What Should the

Respondent Do?

A respondent who does not wish to

challenge the reason to believe finding

and the proposed civil money penalty

must submit a check or money order

equal to the amount of the proposed

civil money penalty to the Commission

within 40 days of the reason to believe

determination. Once the Commission

receives payment, it will send the

respondent a final determination that

the respondent has violated 2 U.S.C.

434(a) and acknowledgment of the

respondent’s payment of the civil

money penalty. The matter would then

be closed and the file would be placed

on the public record pursuant to 11 CFR

111.20 and new 11 CFR 111.42. The

Commission did not receive any

substantive comments on this section.

Section 111.35 If the Respondent

Decides To Challenge the Alleged

Violation or Proposed Civil Money

Penalty, What Should the Respondent

Do?

Proposed § 111.35 in the NPRM set

forth the requirements that respondents

must meet to challenge a reason to

believe finding and/or proposed civil

money penalty. The requirements

included filing a notice of intent to

challenge within twenty days of the date

of the Commission finding reason to

believe and filing a written response

with supporting documentation within

forty days of that date. This proposed

section also provided for circumstances

the Commission will consider in

determining whether to levy a civil

money penalty and defenses that the

Commission will not accept.

The commenter had several criticisms

of this aspect of the administrative fines

procedures. First, the commenter

objected to the requirement of the notice

of intent to challenge the reason to

believe finding and/or proposed civil

money penalty, stating that the

requirement is ‘‘contrary to the plain

language of the statute, which forbids

the Commission from making an

adverse determination ‘until the person

has been given notice and an

opportunity to be heard before the

Commission’ ’’ (citation omitted). While

the Commission disagrees with the

commenter’s legal analysis on this issue,

the Commission agrees that a notice of

intent to challenge is not necessary.

Consequently, that step has been

eliminated from the final rules.

The commenter also objected to the

use of the date of the Commission’s

reason to believe determination to

trigger the time that the respondent has

to file a notice of intent and the written

response. The commenter suggested that

the time to file the notice of intent and

the written response should not begin

until receipt of the notification of the

Commission’s reason to believe finding.

In determining when the time to

appeal begins to toll, some federal

agencies chose the date on which the

decision was made, not the date of

receipt, often providing thirty days from

the date of the initial decision. See e.g.,

Coast Guards Regulations on

Suspension, Revocation, and Appeals,

33 CFR 158.190 (2000); Department of

the Interior Regulations on Public

Lands, 43 CFR 4.356 (2000). The

Commission also notes that several

agencies that begin to toll the time for

appeal upon service of an initial adverse

decision provide thirty days for a party

to file the appeal. See Federal

Retirement Thrift Investment Board

Privacy Act Regulations, 5 CFR 1630.13

(2000); National Indian Gaming

Commission Regulations on Appeals, 25

CFR parts 524 and 539 (2000); Postal

Service Regulations on Suspension and

Revocation of Appeal, 39 CFR 501.12

(2000). Seen in this context, the

Commission believes that forty days is

an ample and fair amount of time for

respondents to file a written response.

The Commission has extended the

traditional thirty day appeal period an

additional ten days to take into account

the time it takes for Commission staff to

prepare the mailing as well as for the

Postal Service to deliver the

notification, with a few additional days

as a margin for error.

The commenter strongly disagrees

with the list of defenses in proposed

§ 111.35 that the Commission will and

will not consider, suggesting that the

Commission has failed to balance the

respondent’s rights with ‘‘administrative

expediency’’ for the Commission. The

commenter recommends that the

Commission eliminate proposed

§ 111.35(c)(1)(iii) and (c)(4) because the

Commission has no rationale for

limiting defenses to ‘‘48-hour

extraordinary circumstance’’ and errors

on the part of the Commission. In

addition, the commenter believes that

the Commission should allow ‘‘good

faith’’ defenses.

The Commission has sound policy

reasons for limiting the respondents’

defenses beyond streamlining the

administrative process. A key

cornerstone of campaign finance law is

the full and timely disclosure of the

political committee’s financial activity.

31790 Federal Register / Vol. 65, No. 98 / Friday, May 19, 2000 / Rules and Regulations

Such disclosure is essential to providing

the public with accurate and complete

information regarding the financing of

federal candidates and political

campaigns. Thus, violations of the

reporting requirements of 2 U.S.C.

434(a) are strict liability offenses.

Political committees are aware or

should be aware of their legal duty to

file the required reports in a timely

manner, and the Commission makes

ongoing efforts to remind committees of

their duty. Committees are given ample

time from the end of the reporting

period to the filing deadline to prepare

and file their reports. Absent

extraordinary circumstances beyond the

committees’ control, the Commission

sees no reason why committees cannot

file their reports by the deadline. The

rationale behind the ‘‘48-hour

extraordinary circumstances’’ exception

is that the Commission recognizes there

may be instances such as natural

disasters where a committee’s office is

located in the disaster area and the

committee cannot timely file a report

because of lack of electricity or flooding

or destruction of committee records.

The Commission, however, expects the

committee to file its report as soon as it

can reasonably do so.

The commenter argues that under

proposed § 111.35(c)(4)(iv) respondents

may be held liable for the failure of the

Commission’s computers. Any failure of

the Commission’s system that prevents

committees from filing their reports

when due would be recognized as an

extraordinary circumstance beyond the

respondents’ control. Therefore,

§ 111.35(c)(4)(iv) has been revised to

exclude Commission computer failures

from the list of circumstances that the

Commission will not consider as

extraordinary circumstances.

The commenter states that, under the

Due Process Clause of the U.S.

Constitution, the Commission bears the

burden of proving the factual

allegations, not the respondent. In its

notification to the respondent of its

reason to believe finding, the

Commission does include the factual

and legal basis for its finding based on

the information available to it. Only the

respondents can answer the

Commission’s allegations, devise their

defenses, and provide the documents

that would support their defenses.

Supporting documentation will permit

the reviewing officer to evaluate the

respondents’ factual allegations and

defenses. Administrative procedures

under other federal agencies also require

respondents to provide the factual and

legal basis for seeking relief or appealing

a decision of the agency. See e.g., 18

CFR 1312.12(d) (2000) (Tennessee

Valley Authority’s regulations requiring

the petition for relief from an

assessment of a civil penalty to ‘‘set

forth in full the legal and factual basis

for the requested relief.’’); 25 CFR 577.3

(2000) (The National Indian Gaming

Commission’s hearing regulations state

that ‘‘* * * the respondent shall file

with the Commission a supplemental

statement that states with particularity

the relief desired and the grounds

therefor and that includes, when

available, supporting evidence in the

form of affidavits.’’). Therefore,

requiring a respondent to include

reasons for challenging the reason to

believe finding and/or proposed civil

money penalty and the factual basis for

those reasons does not violate a

respondent’s rights under the Due

Process Clause.

Section 111.36 Who Will Review the

Respondent’s Written Response?

Proposed § 111.36 in the NPRM

provided for an impartial reviewing

officer to review the reason to believe

finding, the proposed civil money

penalty, the Commission’s

documentation, and the respondent’s

written response and to make a

recommendation to the Commission.

The reviewing officer may request that

the respondent and/or the Commission

staff submit supplemental information.

Paragraph (b) is being revised to clarify

the consequence of failure by the

respondent to file the supplemental

information. Such failure will entitle the

reviewing officer to draw an adverse

inference.

The commenter expressed concern

that the procedures described in

proposed § 111.36 fail to meet the

statutory requirements of

Administrative Procedure Act (APA), 5

U.S.C. 551, et. seq., and the Due Process

Clause of the U.S. Constitution. The

commenter states that the proposed rule

does not include provisions that

incorporate 5 U.S.C. 555(b) and (c),

which entitle a party to appear in

person, to be represented by counsel,

and to have access to documents that

are the basis of the reviewing officer’s

recommendation to the Commission.

The commenter argues that oral

hearings will fulfill the requirements of

5 U.S.C. 555(b) and the Mathews

balancing test to determine whether an

agency’s procedures afford respondents

adequate procedural due process. The

commenter contends that oral hearings

would give greater meaning to the

respondents’ right to an ‘‘opportunity to

be heard’’; would settle disputes

without need for litigation, thereby

conserving resources; and would

develop a full administrative record for

the purposes of judicial review. The

Commission disagrees with some of

these contentions and believes that

these objectives can be achieved in all

cases without need for an oral hearing.

With regard to the respondents’ right

to be represented by counsel, new

§ 111.31 explicitly incorporates

§ 111.23, which allows for respondents

to be represented by counsel in any

matter before the Commission. The

commenter cited to 5 U.S.C. 555(c) as

the basis for requiring the Commission

to give respondents access to documents

used by the reviewing officer in

formulating his or her recommendation.

The Commission disagrees with this

reading of this section of the APA.

Section 555(c) states that a ‘‘person

compelled to submit data or evidence is

entitled to retain or * * * procure a

copy or transcript thereof.’’ Thus,

respondents are entitled to keep a copy

of their written submissions or ask the

Commission to send them a copy of

their written submissions. It does not

grant the respondents the right to obtain

or review other documents that the

reviewing officer relied upon to make

his or her recommendation. The

Commission, however, recognizes that a

respondent should be given copies of

any additional documents that the

reviewing officer examines after the

respondent has filed a challenge to the

reason to believe finding and/or

proposed civil money penalty. For

example, Commission staff might

possibly provide additional materials

regarding receipt of an electronically

filed report. Therefore, paragraph (d) is

being added to revised § 111.36 to

provide for that procedure. Revised

§ 111.36 also adds new paragraph (f) to

require the reviewing officer to send the

respondent a copy of the

recommendation to the Commission and

allows the respondent to file with the

Commission Secretary a written

response to the recommendation within

ten days of the transmittal of the

recommendation. However, the

respondent will not be able to make any

new arguments, that is, the respondent

may not make arguments that the

respondent did not make in its original

written response or that are not in direct

response to the arguments made by the

reviewing officer in his or her

recommendation to the Commission.

The commenter interprets the second

sentence of 5 U.S.C. 555(b) as creating

an independent right to appear in

person with counsel whenever there is

an agency proceeding. The Commission

disagrees with this interpretation. In

reading 5 U.S.C. 555(b) as a whole, it is

apparent that the entitlement described

in the second sentence is triggered only

Federal Register / Vol. 65, No. 98 / Friday, May 19, 2000 / Rules and Regulations 31791

if the person is compelled to appear in

person in an agency proceeding. Thus,

if a person is compelled to appear in

person, the person may chose to appear

by himself or herself, to appear with

counsel, or send counsel or a duly

qualified representative in his or her

stead. The right to appear under 5

U.S.C. 555(b) ‘‘is not blindly absolute,

without regard to the status or nature of

the proceedings and concern for the

orderly conduct of public business.’’

DeVyver v. Warden, 388 F.Supp. 1213,

1222 (M.D. Pa. 1974) (citing Easton

Utilities Commission v. Atomic Energy

Commission, 424 F.2d 847, 852 (D.C.

Cir. 1970)).

Moreover, 5 U.S.C. 555(b) does not

afford the respondents a right to a

hearing. The Supreme Court has held

that even where a statute requires an

‘‘opportunity for hearing,’’ it ‘‘cannot

impute to Congress the design requiring,

nor does due process demand, a hearing

when it appears conclusively from the

applicant’s ‘pleadings’ that the

applicant cannot succeed.’’ Weinberger

v. Hynson, Westcott & Dunning, Inc.,

412 U.S. 609, 621 (1973) (involving the

Federal Drug Administration’s

procedure for withdrawing approval of

a new drug application). Similarly,

lower courts have held that agencies

may make a decision solely on the

written submission, much like summary

judgment, where there are no disputed

issues of material fact that cannot be

resolved by the written submissions.

State of Pennsylvania v. Riley, 84 F.3d

125, 130 (3rd Cir. 1996) (citing Moreau

v. F.E.R.C., 982 F.2d 556, 568 (D.C.

Cir.1993); Altenheim German Home v.

Turnock, 902 F.2d 582, 584 (7th Cir.

1990); California v. Bennett, 843 F.2d,

333, 340 (9th Cir. 1988); Bell Telephone

Co. of Pennsylvania v. FCC, 503 F.2d

1250, 1267–68 (3rd Cir. 1974); Puerto

Rico Aqueduct & Sewer Auth. v. E.P.A.,

35 F.3d 600, 606 (1st Cir. 1994);

Louisiana Ass’n of Indep. Producers and

Royalty Owners v. FERC, 958 F.2d 1101,

1113–15 (D.C. Cir. 1992); City of St.

Louis v. Department of Transp., 936

F.2d 1528, 1534 n. 1 (8th Cir. 1991)).

The court in Puerto Rico Aqueduct &

Sewer recognized the need for

administrative summary judgment. It

stated that:

The choice between summary judgment

and full adjudication—in virtually any

context—reflects a balancing of the value of

efficiency against the values of accuracy and

fairness. Seen in that light, summary

judgment often makes especially good sense

in an administrative forum, for, given the

volume of matters coursing through an

agency’s hallways, efficiency is perhaps more

central to an agency than to a court. . . .

Administrative summary judgment is not

only widely accepted, but also intrinsically

valid. An agency’s choice of such a

procedural device is deserving of deference

under ‘‘the very basic tenet of administrative

law that agencies should be free to fashion

their own rules of procedure.’’ Vermont

Yankee Nuclear Power Corp. v. NRDC, 435

U.S. 519, 544, 98 S.Ct. 1197, 1212, 55 L.Ed.2d

460 (1978).

35 F. 3d at 606.

The balancing of accuracy and

fairness with the need for efficiency in

an agency contains two of the three

prongs of the Mathews test. Unlike other

types of violations that may involve

complex factual and legal issues

requiring extensive fact finding and

analysis and witness testimony, the

legal and factual issues pertaining to

violations of the reporting requirements

of 2 U.S.C. 434(a), are elementary and

readily ascertainable by review of

written submissions. Because of this, a

hearing will not significantly increase

accuracy and fairness but will drain the

Commission’s resources and hinder its

efficiency. Therefore, the Commission

does not believe that a hearing is legally

required especially in light of the

additional procedures that are being

added to the final rules. See supra.

Paragraph (c) is being added to

revised § 111.36 to strongly encourage

respondents to submit documents to the

reviewing officer under §§ 111.35 and

111.36 that are sworn to in the form of

affidavits or declarations. More weight

and credibility are generally given to

statements and documents that are

given under oath or are subject to the

penalty of perjury.

The commenter had several

additional comments with regard to the

reviewing officer. First, the commenter

stated that the reviewing officer could

not be viewed as impartial if he or she

is within the Reports Analysis Division

(RAD) or the Office of General Counsel

(OGC) and suggested an independent

position be created to ensure objectivity

and to shield the reviewing officer from

the supervision of the General Counsel

or the Assistant Staff Director of RAD.

The Commission agrees that

‘‘[i]mpartiality does not require total

independence from the government

agency or the presence of an

administrative law judge * * * [but]

only decisionmaker independence

* * * from the individual action to be

decided.’’ P. Verkuil, A Study of

Informal Adjudication, 43 U. Chi. L.

Rev. 739, 750 n.45 (1976) (citing

Goldberg v. Kelly, 397 U.S. 254, 271

(1970)). The Commission recognizes the

need to separate its prosecutorial

functions from its role as the decider of

facts. Consequently, at this time, the

Commission anticipates that the

reviewing officer most likely will not be

an employee within OGC or RAD.

The commenter also suggested that

the civil money penalties in the

schedules of penalties in § 111.43

should be considered the maximum

civil money penalty and that the

reviewing officer should have the

authority to reduce the civil money

penalty after considering mitigating

factors and the totality of the

circumstances to create ‘‘more flexibility

in applying the new rules.’’ The

Commission disagrees. Allowing the

reviewing officer to reduce the civil

money penalty would vest in the

reviewing officer the authority to make

final decisions, contrary to the FECA

and long standing practice. See 2 U.S.C.

437c(c). Final agency decisions must be

made by an affirmative vote of four

members of the Commission. Also, if the

reviewing officer is granted the

discretion to reduce the civil money

penalties, different civil money penalty

amounts may be levied against political

committees that commit identical

violations, resulting in lack of

uniformity and certainty and giving rise

to the perception of unfairness.

Finally with respect to the reviewing

officer, the commenter advocated that

this person should be subject to the

Commission’s ethics regulation. Further,

the person ‘‘should not be a member of

the enforcement staff who previously

served as counsel in a matter where the

current respondent was either a witness

or a respondent’’ because it will create

a conflict of interest and an appearance

of impropriety. As an employee of the

Commission and the federal

government, the reviewing officer will

be subject to the Commission’s

Standards of Conduct set forth at 11

CFR part 7, and the Standards of Ethical

Conduct for Employees of the Executive

Branch. The conflict of interest standard

in 11 CFR 7.2(c) is designed to address

instances where the employee’s private

interests are inconsistent with the

efficient and impartial conduct of his or

her official duties and responsibilities.

Nothing in the rules bars an employee

from serving in different capacities at

different times such as employees in the

Office of General Counsel subsequently

filling positions in Commissioners’

offices.

Section 111.37 What Will the

Commission Do Once It Receives the

Respondent’s Written Response and the

Reviewing Officer’s Recommendation?

The Commission will make a final

determination, by an affirmative vote of

at least four of its members, as to

whether the respondent has violated the

reporting requirements of 2 U.S.C.

434(a) and the amount of the civil

31792 Federal Register / Vol. 65, No. 98 / Friday, May 19, 2000 / Rules and Regulations

money penalty, if any. The Commission

will then authorize the reviewing officer

to notify the respondent of its decision.

The Commission did not receive any

substantive comments on this section.

Section 111.38 Can the Respondent

Appeal the Commission’s Final

Determination?

This section follows the amendment

to the FECA by specifying that

respondents may appeal a final adverse

determination by the Commission to a

federal district court where the

respondents reside or conduct business

by filing a written petition within thirty

days of receipt of the Commission’s

final determination. Respondents,

however, may not raise any issue that

they did not timely raise in the

administrative proceeding. The

Commission received no substantive

comments on this section.

Section 111.39 When Must the

Respondent Transmit Payment of the

Civil Money Penalty?

Unless the respondent appeals the

Commission’s final determination, the

respondent must send a check or money

order to the Commission within thirty

days of receipt of the final

determination. Once there is a final

determination of the civil money

penalty amount, the civil money penalty

will be a debt owed to the United States.

If the respondent does not submit full

payment, the Commission may forward

the debt to the U.S. Department of the

Treasury for collection under the Debt

Collection Improvement Act of 1996

within 180 days of the date after the

final determination. 31 U.S.C. 3711(g);

31 U.S.C. 3716(c)(6). In the alternative,

the Commission may initiate a civil suit

pursuant to 2 U.S.C. 437g(a)(6)(A). The

Commission did not receive any

substantive comments on this section.

Section 111.40 What Happens If the

Respondent Does Not Pay the Civil

Money Penalty Pursuant to 11 CFR

111.34 and Does Not Submit a Written

Response to the Reason To Believe

Finding Pursuant to 11 CFR 111.35?

The Commission will make a final

determination and assess a civil money

penalty, if any. The respondents will be

notified by letter of the final

determination. The respondent must

pay any assessed civil money penalty

within thirty days of receipt of the final

determination. Unpaid civil money

penalties are debts owed to the United

States and may be transferred to the U.S.

Department of the Treasury for

collection. 31 U.S.C. 3711(g); 31 U.S.C.

3716(c)(6). In the alternative, the

Commission may initiate a civil suit

pursuant to 2 U.S.C. 437g(a)(6)(A).

There were no substantive comments on

this section.

Section 111.41 To Whom Should the

Civil Money Penalty Payment Be Made

Payable?

Respondents must pay the civil

money penalties by check or money

order and make the check or money

order payable to the Federal Election

Commission. The Commission did not

receive any substantive comments on

this section.

Section 111.42 Will the Enforcement

File Be Made Available to the Public?

Once the enforcement matter is

closed, the file will be made available to

the public subject to the provisions of

11 CFR 4.4(a)(3). A matter is considered

closed when neither the Commission

nor the respondent files a civil action in

federal court or when there is a final

disposition of the civil action pursuant

to 11 CFR 111.20(c). The Commission

received no substantive comments on

this section.

Section 111.43 What Are the

Schedules of Penalties?

Proposed § 111.43 contained two

schedules of penalties—one for election

sensitive reports and one for all other

reports. The Commission took into

account the level of activity in the

report, the number of days late, the

election sensitivity of the reports, and

the existence of previous violations in

developing the schedules. Two of these

factors—the level of activity and the

existence of previous violations—are

mandated by the FECA. The

Commission included the number of

days as a factor because fairness

demands that a report that is only a few

days late should not be treated in the

same manner as one that is many days

late or not filed. Similarly, several state

agencies responsible for overseeing state

campaign finance laws levy fines on a

per day basis for violations of their

reporting requirements. See e.g., Fla.

Stat. Ann. § 106.04(8) (West 2000); Haw.

Rev. Stat. § 11–193(a)(5) (1999); N.M.

Stat. Ann. § 1–19–35A (Michie 1999).

Because of the need to disseminate

campaign finance information prior to

an election for it to have a meaningful

impact, the Commission concluded that

it is especially important for reports due

prior to an election to be filed in a

timely manner and before the election.

Thus, the Commission developed a

different schedule of penalties for

election sensitive reports that imposes a

higher civil money penalty for these

reports than other types of reports. In

addition, the schedule of penalties for

election sensitive reports uses an earlier

cut-off date in considering a report not

to be filed than the date used for reports

that are not election sensitive.

The commenter made several

comments and suggestions regarding the

schedules of penalties. First, the

commenter urged the Commission to

calculate the level of activity based on

contributions and expenditures less

overhead and administrative costs,

rather than receipts and disbursements,

arguing that a calculation based on

receipts and disbursements does not

further the goals of FECA and

discriminates against political action

committees. This argument implicitly

assumes that disclosure of some types of

receipts and disbursements is of lesser

importance than disclosure of other

types. The Commission disagrees with

this assumption. The amendment to the

FECA clearly states that the Commission

must take into account the ‘‘amount of

the violation involved,’’ which is not

limited to contributions and

expenditures. Under section 434 of the

Act, political committees are required to

disclose all receipts and disbursements

in their reports, not just contributions

and expenditures. Moreover, Congress

could have drafted the amendment to

include just contributions and

expenditures, as it did for mandatory

electronic filing in Section 639 within

the same amendment, but it did not.

This difference in terms used in these

two sections is strong evidence that

Congress intended these two provisions

to reach different types of financial

activity. Thus, the Commission

concludes that the ‘‘amount of the

violation involved’’ is equal to receipts

and disbursements.

The commenter suggested that the

final rules should state that committees

with no receipts or disbursements will

not be subject to the administrative

fines, and urged the Commission to

allow committees to send an affidavit

attesting to the fact that they did not

have any receipts or disbursements in

lieu of filing a report. The Commission

cannot do so because it does not have

the authority to waive reporting

requirements in this situation. While the

Commission theoretically could make a

final determination that a committee

with no receipts and disbursements is in

violation of 2 U.S.C. 434(a), the

Commission could not assess a civil

money penalty against the committee

because the schedules of penalties only

provides for civil money penalties if the

level of activity is $1.00 or more.

However, committees with no financial

activity should file their reports;

otherwise, the Commission will

calculate an estimated level of activity

Federal Register / Vol. 65, No. 98 / Friday, May 19, 2000 / Rules and Regulations 31793

based on the average level of activity

over the current or previous two-year

election cycle. Unless the committees

file their reports disclosing no financial

activity, the Commission will assess

civil money penalties based on these

estimated levels of activity or $5500 if

the Commission cannot calculate the

estimated levels of activity.

The commenter advocates the

creation of a ‘‘safe harbor’’ for

committees that do not have any

contributions or expenditures in the

given reporting period because these

committees have not engaged in any

political activity in that period. As

discussed above, one of the mandated

factors in determining the civil money

penalty is the amount of the violation,

which is not limited to just

contributions and expenditures.

Committees are required to file reports

even if the committees did not have any

contributions or expenditures. To create

such a ‘‘safe harbor’’ would be to

implicitly allow committees to ignore

their affirmative and legal duty to file

the required reports.

The commenter characterized the

schedules of penalties in the NPRM as

lacking a rational basis and as

discriminating against small

committees. The commenter suggested

that the Commission break down the

level of activity by $5,000 increments.

The basis for the schedules of penalties

is discussed above. The Commission

believes the breakdowns in the

schedules of penalties using the levels

of activity fairly and equitably assess

civil money penalties that reflect the

nature and scope of the violation. The

Commission notes, however, that the

commenter was correct in stating that

small committees that fall within the

first range, $1–$24,999.99, could

potentially pay a civil money penalty

that exceeds their total financial activity

for a given reporting period. Therefore,

the two schedules in § 111.43 are being

amended to include a provision stating

that respondents with no previous

violations will not be assessed a civil

money penalty that exceeds the levels of

activity in the report.

The preamble to the NPRM included

an alternative method for calculating the

schedule of penalties for the election

sensitive reports. Instead of a fifty

percent increase in the base amounts,

the NPRM sought comment on adding a

flat amount of $1000 to the base

amounts for all levels of activity. No

comments directly addressing this issue

were received. However, the commenter

expressed concern that the schedules of

penalties discriminated against

committees with low levels of financial

activity. The Commission has

determined that a flat $1000 addition to

the base amounts would impose on

committees with low levels of financial

activity a significantly higher civil

money penalty relative to their level of

activity than committees with higher

levels of financial activity.

Consequently, the Commission has

decided to adopt a schedule of penalties

that increases the base amounts by fifty

percent for election sensitive reports

instead of adding a flat $1000 to the

base amounts.

The commenter suggested that the

civil money penalties in the schedules

of penalties may be too high in some

instances. The Commission agrees that

the civil money penalties it initially

proposed for non-filers were too high.

Therefore, the civil money penalties for

non-filers are being reduced in the

schedules of penalties in § 111.43 (a)

and (b). With respect to both election

sensitive reports and non-election

sensitive reports, the resulting civil

money penalties for non-filers are

higher than the civil money penalties

for reports filed 30 days late, but are not

as high as the civil money penalties

proposed in the NPRM.

Finally, paragraphs (d) and (e) are

being revised to clarify that election

sensitive reports include reports due

before special elections.

Examples of Civil Money Penalties

Example 1: The respondent files an

October quarterly report 20 days late. The

level of activity on the report is $105,000.

The civil money penalty is calculated as

follows. The base amount is $900. The per

day amount is $125 multiplied by 20 days,

which equals $2500. The civil money penalty

is the sum of these two amounts, which is

$3400.

Example 2: The respondent in the above

example has one prior violation in the

current two-year election cycle. The

premium for the one prior violation is 25%

of the civil money penalty calculated in

example 1, which equals $850. The civil

money penalty is the sum of this premium

and the civil money penalty from example 1,

which is $4250.

Example 3: The respondent files a July

quarterly report on September 1. The report

contains $500 in receipts and disbursements.

The respondent is a non-filer because the

report was more than thirty days late. The

civil money penalty is $500 because it is the

lesser of the level of activity in the report and

$900, which is the civil money penalty for a

non-filer whose level of activity is less than

$25,000.

Example 4: The respondent in the example

3 had one prior violation in the current twoyear election cycle. Because this is not the

respondent’s first violation, the civil money

penalty is not capped by the respondent’s

level of activity. The civil money penalty is

the $900 assessed against non-filers whose

level of activity is less than $25,000 plus a

25% premium equaling $225 for the one

prior violation. Therefore, the civil money

penalty for this respondent is $1125.

Section 111.44 What Is the Schedule of

Penalties for 48-Hour Notices?

Committees are required to report

within 48 hours of receipt of those

contributions of $1000 or more that are

received after the 20th day but more

than 48 hours before an election. 2

U.S.C. 434(a)(6). The Commission

developed a different schedule of

penalties for failure to file these notices

on time because of the nature and

timing of these notices and the need to

have them filed on time. The schedule

proposed in the NPRM did not

distinguish between notices that are

filed late and those that are not filed at

all, and would have imposed a civil

money penalty equal to fifteen percent

of the amount of the contribution(s) not

reported on time plus $100. In the final

rules that follow, this schedule of

penalties is also being reduced because

the resulting civil money penalties may

be too high. The amount in the final

schedule of penalties is being reduced

to 10% of the amount of the

contribution(s) not timely reported plus

$100.

Section 111.45 What Actions Will Be

Taken To Collect Unpaid Civil Money

Penalties?

The Commission may take any and all

appropriate actions authorized and

required by the Debt Collection Act of

1982, as amended by the Debt

Collection Improvement Act of 1996 (31

U.S.C. 3701 et. seq.). This section adopts

the Federal Claims Collection Standards

issued jointly by the Department of

Justice and the General Accounting

Office, 4 CFR parts 101–105, to provide

procedures for the collection of the debt.

This section also adopts by crossreference the regulations issued by U.S.

Department of the Treasury at 31 CFR

285.2, 285.4, and 285.7. Changes are

being made to this section in the final

rules for clarification purposes. The

Commission did not receive any

substantive comments on this section.

Certification of No Effect Pursuant to 5

U.S.C. 605(b) (Regulatory Flexibility

Act)

The attached final rule will not have

a significant economic impact on a

substantial number of small entities.

The basis for this certification is that the

final rule will impose penalties which

are scaled to take into account the size

of the financial activity of the political

committees. Thus, committees with less

financial activity will be subject to

lower fines than committees with more

31794 Federal Register / Vol. 65, No. 98 / Friday, May 19, 2000 / Rules and Regulations

financial activity. Also, the Commission

anticipates that there will not be a large

number of small committees that would

be subject to the process in the proposed

rules. Therefore, the final rules will not

have a significant economic impact on

a substantial number of small entities.

List of Subjects

11 CFR Part 104

Campaign funds, Political committees

and parties, Reporting and

recordkeeping requirements.

11 CFR Part 111

Administrative practice and

procedures, Elections, Law enforcement.

For reasons set out in the preamble,

subchapter A, Chapter I of Title 11 of

the Code of Federal Regulations is

amended as follows:

PART 104—REPORTS BY POLITICAL

COMMITTEES (2 U.S.C. 434)

1. The authority for part 104

continues to read as follows:

Authority: 2 U.S.C. 431(1), 431(8), 431(9),

432(i), 434, 438(a)(8), 438(b), 439a.

2. 11 CFR 104.5 is amended by adding

new paragraph (i) to read as follows:

§ 104.5 Filing dates (2 U.S.C. 434(a)(2)).

* * * * *

(i) Committees should retain proof of

mailing or other means of transmittal of

the reports to the Commission.

PART 111—COMPLIANCE

PROCEDURES (2 U.S.C. 437g, 437d(a))

3. The authority for part 111

continues to read as follows:

Authority: 2 U.S.C. 437g, 437d(a),

438(a)(8).

4. 11 CFR 111.8 is amended by adding

new paragraph (d) to read as follows:

§ 111.8 Internally generated matters;

referrals (2 U.S.C. 437g(a)(2)).

* * * * *

(d) Notwithstanding §§ 111.9 through

111.19, for violations of 2 U.S.C. 434(a),

the Commission, when appropriate, may

review internally generated matters

under subpart B of this part.

5. 11 CFR 111.20 is amended by

adding new paragraph (c) to read as

follows:

§ 111.20 Public disclosure of Commission

action (2 U.S.C. 437g(a)(4)).

* * * * *

(c) For any compliance matter in

which a civil action is commenced, the

Commission will make public the nonexempt 2 U.S.C. 437g investigatory

materials in the enforcement and

litigation files no later than thirty (30)

days from the date on which the

Commission sends the complainant and

the respondent(s) the required

notification of the final disposition of

the civil action. The final disposition

may consist of a judicial decision which

is not reviewed by a higher court.

6. 11 CFR 111.24(a) is revised to read

as follows:

§ 111.24 Civil Penalties (2 U.S.C. 437g(a)

(5), (6), (12), 28 U.S.C. 2461 nt.).

(a) Except as provided in 11 CFR part

111, subpart B and in paragraph (b) of

this section, a civil penalty negotiated

by the Commission or imposed by a

court for a violation of the Act or

chapters 95 or 96 of title 26 (26 U.S.C.)

shall not exceed the greater of $5,500 or

an amount equal to any contribution or

expenditure involved in the violation.

In the case of a knowing and willful

violation, the civil penalty shall not

exceed the greater of $11,000 or an

amount equal to 200% of any

contribution or expenditure involved in

the violation.

* * * * *

7. Part 111 is amended by designating

11 CFR 111.1 through 111.24 as subpart

A—Enforcement—and by adding new

subpart B to read as follows:

Subpart B—Administrative Fines

Sec.

111.30 When will subpart B apply?

111.31 Does this subpart replace subpart A

of this part for violations of the reporting

requirements of 2 U.S.C. 434(a)?

111.32 How will the Commission notify

respondents of a reason to believe

finding and a proposed civil money

penalty?

111.33 What are the respondent’s choices

upon receiving the reason to believe

finding and the proposed civil money

penalty?

111.34 If the respondent decides to pay the

civil money penalty and not to challenge

the reason to believe finding, what

should the respondent do?

111.35 If the respondent decides to

challenge the alleged violation or

proposed civil money penalty, what

should the respondent do?

111.36 Who will review the respondent’s

written response?

111.37 What will the Commission do once

it receives the respondent’s written

response and the reviewing officer’s

recommendation?

111.38 Can the respondent appeal the

Commission’s final determination?

111.39 When must the respondent pay the

civil money penalty?

111.40 What happens if the respondent

does not pay the civil money penalty

pursuant to 11 CFR 111.34 and does not

submit a written response to the reason

to believe finding pursuant to 11 CFR

111.35?

111.41 To whom should the civil money

penalty payment be made payable?

111.42 Will the enforcement file be made

available to the public?

111.43 What are the schedules of penalties?

111.44 What is the schedule of penalties for

48-hour notices that are not filed or filed

late?

111.45 What actions will be taken to collect

unpaid civil money penalties?

§ 111.30 When will subpart B apply?

Subpart B applies to violations of the

reporting requirements of 2 U.S.C.

434(a) committed by political

committees and their treasurers on or

after July 14, 2000, and on or before

December 31, 2001.

§ 111.31 Does this subpart replace subpart

A of this part for violations of the reporting

requirements of 2 U.S.C. 434(a)?

(a) No; §§ 111.1 through 111.8 and

111.20 through 111.24 shall apply to all

compliance matters. This subpart will

apply, rather than §§ 111.9 through

111.19, when the Commission, on the

basis of information ascertained by the

Commission in the normal course of

carrying out its supervisory

responsibilities, and when appropriate,

determines that the compliance matter

should be subject to this subpart. If the

Commission determines that the

violation should not be subject to this

subpart, then the violation will be

subject to all sections of subpart A of

this part.

(b) Subpart B will apply to

compliance matters resulting from a

complaint filed pursuant to 11 CFR

111.4 through 111.7 if the complaint

alleges a violation of 2 U.S.C. 434(a). If

the complaint alleges violations of any

other provision of any statute or

regulation over which the Commission

has jurisdiction, subpart A will apply to

the alleged violations of these other

provisions.

§ 111.32 How will the Commission notify

respondents of a reason to believe finding

and a proposed civil money penalty?

If the Commission determines, by an

affirmative vote of at least four (4) of its

members, that it has reason to believe

that a respondent has violated 2 U.S.C.

434(a), the Chairman or Vice-Chairman

shall notify such respondent of the

Commission’s finding. The written

notification shall set forth the following:

(a) The alleged factual and legal basis

supporting the finding including the

type of report that was due, the filing

deadline, the actual date filed (if filed),

and the number of days the report was

late (if filed);

(b) The applicable schedule of

penalties;

(c) The number of times the

respondent has been assessed a civil

Federal Register / Vol. 65, No. 98 / Friday, May 19, 2000 / Rules and Regulations 31795

money penalty under this subpart

during the current two-year election

cycle and the prior two-year election

cycle;

(d) The amount of the proposed civil

money penalty based on the schedules

of penalties set forth in 11 CFR 111.43

or 111.44; and

(e) An explanation of the respondent’s

right to challenge both the reason to

believe finding and the proposed civil

money penalty.

§ 111.33 What are the respondent’s

choices upon receiving the reason to

believe finding and the proposed civil

money penalty?

The respondent must either send

payment in the amount of the proposed

civil money penalty pursuant to 11 CFR

111.34 or submit a written response

pursuant to 11 CFR 111.35.

§ 111.34 If the respondent decides to pay

the civil money penalty and not to challenge

the reason to believe finding, what should

the respondent do?

(a) The respondent shall transmit

payment in the amount of the civil

money penalty to the Commission

within forty (40) days of the

Commission’s reason to believe finding.

(b) Upon receipt of the respondent’s

payment, the Commission shall send the

respondent a final determination that

the respondent has violated the statute

or regulations and the amount of the

civil money penalty and an

acknowledgment of the respondent’s

payment.

§ 111.35 If the respondent decides to

challenge the alleged violation or proposed

civil money penalty, what should the

respondent do?

(a) Within forty (40) days of the

Commission’s reason to believe finding,

the respondent shall submit to the

Commission a written response.

(b) The written response shall contain

the following:

(1) Reason(s) why the respondent is

challenging the reason to believe finding

and/or civil money penalty which may

consist of:

(i) The existence of factual errors;

and/or

(ii) The improper calculation of the

civil money penalty; and/or

(iii) The existence of extraordinary

circumstances that were beyond the

control of the respondent and that were

for a duration of at least 48 hours and

that prevented the respondent from

filing the report in a timely manner;

(2) The factual basis supporting the

reason(s); and

(3) Supporting documentation.

(4) Examples of circumstances that

will not be considered extraordinary

include, but are not limited to, the

following:

(i) Negligence;

(ii) Problems with vendors or

contractors;

(iii) Illness of staff;

(iv) Computer failures (except failures

of the Commission’s computers); and

(v) Other similar circumstances.

§ 111.36 Who will review the respondent’s

written response?

(a) A reviewing officer shall review

the respondent’s written response. The

reviewing officer shall be a person who

has not been involved in the reason to

believe finding.

(b) The reviewing officer shall review

the reason to believe finding with

supporting documentation and the

respondent’s written response with

supporting documentation. The

reviewing officer may request

supplemental information from the

respondent and/or the Commission

staff. The respondent shall submit the

supplemental information to the

reviewing officer within a time specified

by the reviewing officer. The reviewing

officer will be entitled to draw an

adverse inference from the failure by the

respondent to submit the supplemental

information.

(c) All documents required to be

submitted by the respondents pursuant

to this section and § 111.35 should be

submitted in the form of affidavits or

declarations.

(d) If the Commission staff, after the

respondent files a written response

pursuant to § 111.35, forwards any

additional documents pertaining to the

matter to the reviewing officer for his or

her examination, the reviewing officer

shall also furnish a copy of the

document(s) to the respondents.

(e) Upon completion of the review,

the reviewing officer shall forward a

written recommendation to the

Commission along with all documents

required under this section and 11 CFR

111.32 and 111.35.

(f) The reviewing office shall also

forward a copy of the recommendation

to the respondent. The respondent may

file with the Commission Secretary a

written response to the recommendation

within ten (10) days of transmittal of the

recommendation. This response may

not raise any arguments not raised in

the respondent’s original written

response or not directly responsive to

the reviewing officer’s recommendation.

§ 111.37 What will the Commission do

once it receives the respondent’s written

response and the reviewing officer’s

recommendation?

(a) If the Commission, after having

found reason to believe and after

reviewing the respondent’s written

response and the reviewing officer’s

recommendation, determines by an

affirmative vote of at least four (4) of its

members, that the respondent has

violated 2 U.S.C. 434(a) and the amount

of the civil money penalty, the

Commission shall authorize the

reviewing officer to notify the

respondent by letter of its final

determination.

(b) If the Commission, after reviewing

the reason to believe finding, the

respondent’s written response, and the

reviewing officer’s written

recommendation, determines by an

affirmative vote of at least four (4) of its

members, that no violation has

occurred, or otherwise terminates its

proceedings, the Commission shall

authorize the reviewing officer to notify

the respondent by letter of its final

determination.

(c) The Commission will modify the

proposed civil money penalty only if

the respondent is able to demonstrate

that the amount of the proposed civil

money penalty was calculated on an

incorrect basis.

(d) The Commission may determine,

by an affirmative vote of at least four of

its members, that a violation of 2 U.S.C.

434(a) has occurred but waive the

penalty because the respondent has

convincingly demonstrated the

existence of extraordinary

circumstances that were beyond the

respondent’s control and that were for a

duration of at least 48 hours. The

Commission shall authorize the

reviewing officer to notify the

respondent by letter of its final

determination.

§ 111.38 Can the respondent appeal the

Commission’s final determination?

Yes; within thirty (30) days of receipt

of the Commission’s final determination

under 11 CFR 111.37, the respondent

may submit a written petition to the

district court of the United States for the

district in which the respondent resides,

or transacts business, requesting that the

final determination be modified or set

aside. The respondent’s failure to raise

an argument in a timely fashion during

the administrative process shall be

deemed a waiver of the respondent’s

right to present such argument in a

petition to the district court under 2

U.S.C. 437g.

§ 111.39 When must the respondent pay

the civil money penalty?

(a) If the respondent does not submit

a written petition to the district court of

the United States, the respondent must

remit payment of the civil money

penalty within thirty (30) days of receipt

31796 Federal Register / Vol. 65, No. 98 / Friday, May 19, 2000 / Rules and Regulations

of the Commission’s final determination

under 11 CFR 111.37.

(b) If the respondent submits a written

petition to the district court of the

United States and, upon the final

disposition of the civil action, is

required to pay a civil money penalty,

the respondent shall remit payment of

the civil money penalty to the

Commission within thirty (30) days of

the final disposition of the civil action.

The final disposition may consist of a

judicial decision which is not reviewed

by a higher court.

(c) Failure to pay the civil money

penalty may result in the

commencement of collection action

under 31 U.S.C. 3701 et seq. (1996), or

a civil suit pursuant to 2 U.S.C.

437g(a)(6)(A), or any other legal action

deemed necessary by the Commission.

§ 111.40 What happens if the respondent

does not pay the civil money penalty

pursuant to 11 CFR 111.34 and does not

submit a written response to the reason to

believe finding pursuant to 11 CFR 111.35?

(a) If the Commission, after the

respondent has failed to pay the civil

money penalty and has failed to submit

a written response, determines by an

affirmative vote of at least four (4) of its

members that the respondent has

violated 2 U.S.C. 434(a) and determines

the amount of the civil money penalty,

the respondent shall be notified by letter

of its final determination.

(b) The respondent shall transmit

payment of the civil money penalty to

the Commission within thirty (30) days

of receipt of the Commission’s final

determination.

(c) Failure to pay the civil money

penalty may result in the

commencement of collection action

under 31 U.S.C. 3701 et seq. (1996), or

a civil suit pursuant to 2 U.S.C.

437g(a)(6)(A), or any other legal action

deemed necessary by the Commission.

§ 111.41 To whom should the civil money

penalty payment be made payable?

Payment of civil money penalties

shall be made in the form of a check or

money order made payable to the

Federal Election Commission.

§ 111.42 Will the enforcement file be made

available to the public?

(a) Yes; the Commission shall make

the enforcement file available to the

public.

(b) If neither the Commission nor the

respondent commences a civil action,

the Commission shall make the

enforcement file available to the public

pursuant to 11 CFR 4.4(a)(3).

(c) If a civil action is commenced, the

Commission shall make the enforcement

file available pursuant to 11 CFR

111.20(c).

§ 111.43 What are the schedules of

penalties?

(a) The civil money penalty for all

reports that are filed late or not filed,

except election sensitive reports and

pre-election reports under 11 CFR 104.5,

shall be calculated in accordance with

the following schedule of penalties:

If the level of activity in the report was: And the report was filed late, the civil

money penalty is:

Or the report was not filed, the civil

money penalty is:

$1–24,999.99 a ........................................... [$100 + ($25 × Number of days late)] × [1 + (.25 ×

Number of previous violations)].

$900 × [1 + (.25 × Number of previous

violations)].

$25,000–49,999.99 ..................................... [$200 + ($50 × Number of days late)] × [1 + (.25 ×

Number of previous violations)].

$1800 × [1 + (.25 × Number of previous

violations)].

$50,000–74,999.99 ..................................... [$300 + ($75 × Number of days late)] × [1 + (.25 ×

Number of previous violations)].

$2700 × [1 + (.25 × Number of previous

violations)].

$75,000–99,999.99 ..................................... [$400 + ($100 × Number of days late)] × [1 + (.25 ×

Number of previous violations)].

$3500 × [1 + (.25 × Number of previous

violations)].

$100,000–149,999.99 ................................. [$600 + ($125 × Number of days late)] × [1 + (.25 ×

Number of previous violations)].

$4500 × [1 + (.25 × Number of previous

violations)].

$150,000–199,999.99 ................................. [$800 + ($150 × Number of days late)] × [1 + (.25 ×

Number of previous violations)].

$5500 × [1 + (.25 × Number of previous

violations)].

$200,000–249,999.99 ................................. [$1000 + ($175 × Number of days late)] × [1 + (.25 ×

Number of previous violations)].

$6500 × [1 + (.25 × Number of previous

violations)].

$250,000–349,999.99 ................................. [$1500 + ($200 × Number of days late)] × [1 + (.25 ×

Number of previous violations)].

$8000 × [1 + (.25 × Number of previous

violations)].

$350,000–449,999.99 ................................. [$2000 + ($200 × Number of days late)] × [1 + (.25 ×

Number of previous violations)].

$9000 × [1 + (.25 × Number of previous

violations)].

$450,000–549,999.99 ................................. [$2500 + ($200 × Number of days late)] × [1 + (.25 ×

Number of previous violations)].

$9500 × [1 + (.25 × Number of previous

violations)].

$550,000–649,999.99 ................................. [$3000 + ($200 × Number of days late)] × [1 + (.25 ×

Number of previous violations)].

$10,000 × [1 + (.25 × Number of previous

violations)].

$650,000–749,999.99 ................................. [$3500 + ($200 × Number of days late)] × [1 + (.25 ×

Number of previous violations)].

$10,500 × [1 + (.25 × Number of previous

violations)].

$750,000–849,999.99 ................................. [$4000 + ($200 × Number of days late)] × [1 + (.25 ×

Number of previous violations)].

$11,000 × [1 + (.25 × Number of previous

violations)].

Federal Register / Vol. 65, No. 98 / Friday, May 19, 2000 / Rules and Regulations 31797

If the level of activity in the report was: And the report was filed late, the civil

money penalty is:

Or the report was not filed, the civil

money penalty is:

$850,000–949,999.99 ................................. [$4500 + ($200 × Number of days late)] × [1 + (.25 ×

Number of previous violations)].

$11,500 × [1 + (.25 × Number of previous

violations)].

$950,000 or over ........................................ [$5000 + ($200 × Number of days late)] × [1 + (.25 ×

Number of previous violations)].

$12,000 × [1 + (.25 × Number of previous

violations)].

aThe civil money penalty for a respondent who does not have any previous violations will not exceed the level of activity in the report.

(b) The civil money penalty for election sensitive reports that are filed late or not filed shall be calculated in

accordance with the following schedule of penalties.

If the level of activity in the report was: And the report was filed late, the civil

money penalty is:

Or the report was not filed, the civil

money penalty is:

$1–24,999.99 a ............................................ [$150 + ($25 × Number of days late)] × [1 + (.25 ×

Number of previous violations)].

$1000 × [1 + (.25 × Number of previous

violations)].

$25,000–49,999.99 ..................................... [$300 + ($50 × Number of days late)] × [1 + (.25 ×

Number of previous violations)].

$2000 × [1 + (.25 × Number of previous

violations)].

$50,000–74,999.99 ..................................... [$450 + ($75 × Number of days late)] × [1 + (.25 ×

Number of previous violations)].

$3000 × [1 + (.25 × Number of previous

violations)].

$75,000–99,999.99 ..................................... [$600 + ($100 × Number of days late)] × [1 + (.25 ×

Number of previous violations)].

$4000 × [1 + (.25 × Number of previous

violations)].

$100,000–149,999.99 ................................. [$900 + ($125 × Number of days late)] × [1 + (.25 ×

Number of previous violations)].

$5000 × [1 + (.25 × Number of previous

violations)].

$150,000–199,999.99 ................................. [$1200 + ($150 × Number of days late)] × [1 + (.25 ×

Number of previous violations)].

$6000 × [1 + (.25 × Number of previous

violations)].

$200,000–249,999.99 ................................. [$1500 + ($175 × Number of days late)] × [1 + (.25 ×

Number of previous violations)].

$7500 × [1 + (.25 × Number of previous

violations)].

$250,000–349,999.99 ................................. [$2250 + ($200 × Number of days late)] × [1 + (.25 ×

Number of previous violations)].

$9000 × [1 + (.25 × Number of previous

violations)].

$350,000–449,999.99 ................................. [$3000 + ($200 × Number of days late)] × [1 + (.25 ×

Number of previous violations)].

$10,000 × [1 + (.25 × Number of previous

violations)].

$450,000–549,999.99 ................................. [$3750 + ($200 × Number of days late)] × [1 + (.25 ×

Number of previous violations)].

$11,000 × [1 + (.25 × Number of previous

violations)].

$550,000–649,999.99 ................................. [$4500 + ($200 × Number of days late)] × [1 + (.25 ×

Number of previous violations)].

$12,000 × [1 + (.25 × Number of previous

violations)].

$650,000–749,999.99 ................................. [$5250 + ($200 × Number of days late)] × [1 + (.25 ×

Number of previous violations)].

$13,000 × [1 + (.25 × Number of previous

violations)].

$750,000–849,999.99 ................................. [$6000 + ($200 × Number of days late)] × [1 + (.25 ×

Number of previous violations)].

$14,000 × [1 + (.25 × Number of previous

violations)].

$850,000–949,999.99 ................................. [$6750 + ($200 × Number of days late)] × [1 + (.25 ×

Number of previous violations)].

$15,000 × [1 + (.25 × Number of previous

violations)].

$950,000 or over ........................................ [$7500 + ($200 × Number of days late)] × [1 + (.25 ×

Number of previous violations)].

$16,000 × [1 + (.25 × Number of previous

violations)].

aThe civil money penalty for a respondent who does not have any previous violations will not exceed the level of activity in the report.

(c) If the respondent fails to file a

required report and the Commission

cannot calculate the level of activity

under paragraph (d) of this section, then

the civil money penalty shall be $5,500.

(d) Definitions. For this section only,

the following definitions will apply:

Election Sensitive Reports means

third quarter reports due on October

15th before the general election (for all

committees required to file this report

except committees of candidates who do

not participate in that general election);

monthly reports due October 20th

before the general election (for all

committees required to file this report

except committees of candidates who do

not participate in that general election);

and pre-election reports for primary,

general, and special elections under 11

CFR 104.5.

Estimated level of activity means total

receipts and disbursements reported in

the current two-year election cycle

divided by the number of reports filed

to date covering the activity in the

current two-year election cycle. If the

respondent has not filed a report

covering activity in the current two-year

election cycle, estimated level of

activity means total receipts and

disbursements reported in the prior twoVerDate 11<MAY>2000 16:35 May 18, 2000 Jkt 190000 PO 00000 Frm 00011 Fmt 4700 Sfmt 4700 E:\FR\FM\19MYR1.SGM pfrm02 PsN: 19MYR1
31798 Federal Register / Vol. 65, No. 98 / Friday, May 19, 2000 / Rules and Regulations

year election cycle divided by the

number of reports filed covering the

activity in the prior two-year election

cycle.

Level of activity means the total

amount of receipts and disbursements

for the period covered by the late report.

If the report is not filed, the level of

activity is the estimated level of activity.

Number of previous violations mean

all prior final civil money penalties

assessed under this subpart during the

current two-year election cycle and the

prior two-year election cycle.

(e) For purposes of the schedules of

penalties in paragraphs (a) and (b) of

this section,

(1) Reports that are not election

sensitive reports are considered to be

filed late if they are filed after their due

dates but within thirty (30) days of their

due dates. These reports are considered

to be not filed if they are filed after

thirty (30) days of their due dates or not

filed at all.

(2) Election sensitive reports are

considered to be filed late if they are

filed after their due dates but prior to

four (4) days before the primary election

for pre-primary reports, prior to four (4)

days before the special election for prespecial election reports, or prior to four

(4) days before the general election for

all other election sensitive reports.

These reports are considered to be not

filed if they are not filed prior to four

(4) days before the primary election for

pre-primary reports, prior to four (4)

days before the special election for prespecial election reports or prior to four

(4) days before the general election for

all other election sensitive reports.

§ 111.44 What is the schedule of penalties

for 48-hour notices that are not filed or are

filed late?

(a) If the respondent fails to file timely

a notice regarding contribution(s)

received after the 20th day but more

than 48 hours before the election as

required under 2 U.S.C. 434(a)(6), the

civil money penalty will be calculated

as follows:

(1) Civil money penalty = $100 + (.10

× amount of the contribution(s) not

timely reported).

(2) The civil money penalty

calculated in paragraph (a)(1) of this

section shall be increased by twenty-five

percent (25%) for each prior violation.

(b) For purposes of this section, prior

violation means a civil money penalty

that has been assessed against the

respondent under this subpart in the

current two-year election cycle or the

prior two-year election cycle.

§ 111.45 What actions will be taken to

collect unpaid civil money penalties?

The Commission may take any and all

appropriate collection actions

authorized and required by the Debt

Collection Act of 1982, as amended by

the Debt Collection Improvement Act of

1996 (31 U.S.C. 3701 et. seq.). The U.S.

Department of the Treasury regulations

at 31 CFR 285.2, 285.4, and 285.7 and

the Federal Claims Collection Standards

issued jointly by the Department of

Justice and the Government Accounting

Office at 4 CFR parts 101 through 105

also apply.

Dated: May 12, 2000.

Darryl R. Wold,

Chairman, Federal Election Committee.

[FR Doc. 00–12484 Filed 5–18–00; 8:45 am]

BILLING CODE 6715–01–P

DEPARTMENT OF TRANSPORTATION

Federal Aviation Administration

14 CFR Part 91

[Docket No. FAA–2000–7110; Amendment

No. 91–262]

RIN 2120–AG94

Special Visual Flight Rules

AGENCY: Federal Aviation

Administration, DOT.

ACTION: Direct final rule; confirmation of

effective date.

SUMMARY: This action amends the

language regarding aircraft operating in

accordance with Special Visual Flight

Rules (SVFR). Specially, this action will

permit a general aviation pilot at a

satellite airport where weather reporting

is not available, to depart in

meteorological conditions less than

basic Visual Flight Rules (VFR) weather

minimums provided that the pilot

determines that he has the requisite

flight visibility. The FAA is taking this

action to reduce the number of

unnecessary flight delays being faced by

general aviation aircraft while providing

an equivalent level of safety.

EFFECTIVE DATE: The rule is effective on

May 23, 2000.

FOR FURTHER INFORMATION CONTACT: Avis

P. Person, Airspace and Rules Division

(ATA–400), Air Traffic Airspace

Management Program, Federal Aviation

Administration, 800 Independence

Avenue, SW, Washington, DC 20591;

telephone number (202) 267–8783.

SUPPLEMENTARY INFORMATION: The FAA

published this direct final rule with a

request for comments in the Federal

Register on March 24, 2000 (65 FR

16114). The FAA uses the direct final

rulemaking procedure for a noncontroversial rule where the FAA

believes that there will be no adverse

public comment. This direct final rule

advised the public that no adverse

comments were anticipated, and that

unless a written adverse comment, or a

written notice of intent to submit such

an adverse comment, were received

within the comment period, the

regulation would become effective on

May 23, 2000. No adverse comments

were received, and thus this notice

confirms that this final rule will become

effective on that date.

Issued in Washington, DC, on May 12,

2000.

Donald P. Byrne,

Assistant Chief Counsel, Regulations

Division.

[FR Doc. 00–12561 Filed 5–18–00; 8:45 am]

BILLING CODE 4910–13–M

DEPARTMENT OF TRANSPORTATION

Federal Aviation Administration

14 CFR Part 97

[Docket No. 30042; Amdt. No. 1991]

Standard Instrument Approach

Procedures; Miscellaneous

Amendments

AGENCY: Federal Aviation

Administration (FAA), DOT.

ACTION: Final rule.

SUMMARY: This amendment establishes,

amends, suspends, or revokes Standard

Instrument Approach Procedures

(SIAPs) for operations at certain

airports. These regulatory actions are

needed because of the adoption of new

or revised criteria, or because of changes

occurring in the National Airspace

System, such as the commissioning of

new navigational facilities, addition of

new obstacles, or changes in air traffic

requirements. These changes are

designed to provide safe and efficient

use of the navigable airspace and to

promote safe flight operations under

instrument flight rules at the affected

airports.

DATES: An effective date for each SIAP

is specified in the amendatory

provisions.

Incorporation by reference-approved

by the Director of the Federal Register

on December 31, 1980, and reapproved

as of January 1, 1982.

ADDRESSES: Availability of matters

incorporated by reference in the

amendment is as follows: