53054 Federal Register / Vol. 71, No. 174 / Friday, September 8, 2006 / Proposed Rules 

to be discussed and the time to be 

devoted to each topic (signed original 

and eight (8) copies) by December 8, 

2006. A period of 10 minutes will be 

allotted to each person for making 

comments. An agenda showing the 

scheduling of the speakers will be 

prepared after the deadline for receiving 

outlines has passed. Copies of the 

agenda will be available free of charge 

at the hearing. 

Drafting Information 

The principal author of these 

regulations is Winston H. Douglas, 

Office of the Associate Chief Counsel 

(Passthroughs and Special Industries). 

List of Subjects in 26 CFR Part 1 

Income taxes, Reporting and 

recordkeeping requirements. 

Proposed Amendments to the 

Regulations 

Accordingly, 26 CFR part 1 is 

proposed to be amended as follows: 

PART 1—INCOME TAXES 

Paragraph 1. The authority citation 

for part 1 continues to read as follows: 

Authority: 26 U.S.C. 7805 * * * 

Par. 2. Section 1.45G–0 is added to 

read as follows: 

§ 1.45G–0 Table of contents for the 

railroad track maintenance credit rules. 

[The text of this proposed section is 

the same as the text of § 1.45G–0T 

published elsewhere in this issue of the 

Federal Register]. 

Par. 3. Section 1.45G–1 is added to 

read as follows: 

§ 1.45G–1 Railroad track maintenance 

credit. 

[The text of this proposed section is 

the same as the text of § 1.45G–1T 

published elsewhere in this issue of the 

Federal Register]. 

Mark E. Matthews, 

Deputy Commissioner for Services and 

Enforcement. 

[FR Doc. E6–14856 Filed 9–7–06; 8:45 am] 

BILLING CODE 4830–01–P 

DEPARTMENT OF LABOR 

Mine Safety and Health Administration 

30 CFR Part 100 

RIN 1219–AB51 

Criteria and Procedures for Proposed 

Assessment of Civil Penalties 

AGENCY: Mine Safety and Health 

Administration (MSHA), Labor. 

ACTION: Proposed rule. 

SUMMARY: The Mine Safety and Health 

Administration (MSHA) is proposing to 

amend its civil penalty regulations to 

increase penalty amounts and to 

implement new requirements of the 

Mine Improvement and New Emergency 

Response (MINER) Act of 2006 

amendments to the Mine Safety and 

Health Act of 1977 (Mine Act). In 

addition, MSHA is proposing to revise 

procedures for proposing civil monetary 

penalties to improve the efficiency and 

effectiveness of the civil penalty 

process. These changes are intended to 

induce greater mine operator 

compliance with the Mine Act and 

MSHA’s safety and health standards and 

regulations, thereby improving safety 

and health for miners. 

DATES: MSHA must receive comments 

on or before October 23, 2006. MSHA 

will hold six public hearings on 

September 26, 2006, September 28, 

2006, October 4, 2006, October 6, 2006, 

October 17, 2006, and October 19, 2006. 

Details about the public hearings are in 

the SUPPLEMENTARY INFORMATION section 

of this document. 

ADDRESSES: Comments must be clearly 

identified with as such and may be sent 

to MSHA by any of the following 

methods: 

(1) Federal eRulemaking Portal: http: 

//www.regulations.gov. Follow the 

instructions for submitting comments. 

(2) Electronic mail: zzMSHAcomments@dol.gov. Include ‘‘RIN 1219–

AB51’’ in the subject line of the 

message. 

(3) Telefax: (202) 693–9441. Include 

‘‘RIN 1219–AB51’’ in the subject. 

(4) Regular Mail: MSHA, Office of 

Standards, Regulations, and Variances, 

1100 Wilson Blvd., Room 2350, 

Arlington, Virginia 22209–3939. 

(5) Hand Delivery or Courier: MSHA, 

Office of Standards, Regulations, and 

Variances, 1100 Wilson Blvd., Room 

2350, Arlington, Virginia 22209–3939. 

Stop by the 21st floor and sign in at the 

receptionist’s desk. 

Docket: Comments can be accessed 

electronically at www.msha.gov under 

the ‘‘Rules and Regs’’ link. MSHA will 

post all comments on the Internet 

without change, including any personal 

information provided. Comments may 

also be reviewed at the Office of 

Standards, Regulations, and Variances, 

1100 Wilson Blvd., Room 2350, 

Arlington, Virginia. 

MSHA maintains a listserv that 

enables subscribers to receive e-mail 

notification when rulemaking 

documents are published in the Federal 

Register. To subscribe to the listserv, go 

to http://www.msha.gov/subscriptions/ 

subscribe.aspx. 

Hearings: Locations of the public 

hearings are in the SUPPLEMENTARY

INFORMATION section of this document. 

FOR FURTHER INFORMATION CONTACT: 

Patricia W. Silvey, Acting Director, 

Office of Standards, Regulations, and 

Variances, MSHA, 1100 Wilson Blvd, 

Room 2350, Arlington, Virginia 22209–

3939, silvey.patricia@dol.gov (e-mail), 

(202) 693–9440 (voice), or (202) 693–

9441 (telefax). 

SUPPLEMENTARY INFORMATION: 

Outline: 

I. Public Hearings 

II. Background 

A. General 

B. Rulemaking History 

III. Discussion and Analysis of Proposed 

Changes to Part 100 

A. General Discussion 

B. Section-by-Section Analysis 

IV. Executive Order 12866 

A. Population at Risk 

B. Costs 

C. Benefits 

V. Feasibility 

A. Technological Feasibility 

B. Economic Feasibility 

VI. Regulatory Flexibility Act and Small 

Business Regulatory Enforcement 

Fairness Act (SBREFA) 

A. Definition of Small Mine 

B. Factual Basis for Certification 

VII. Paperwork Reduction Act of 1995 

VIII. Other Regulatory Considerations 

A. The Unfunded Mandates Reform Act of 

1995 

B. Treasury and General Government 

Appropriations Act of 1999: Assessment 

of Federal Regulations and Policies on 

Families 

C. Executive Order 12630: Government 

Actions and Interference With 

Constitutionally Protected Property 

Rights 

D. Executive Order 12988: Civil Justice 

Reform 

E. Executive Order 13045: Protection of 

Children From Environmental Health 

Risks and Safety Risks 

F. Executive Order 13132: Federalism 

G. Executive Order 13175: Consultation 

and Coordination With Indian Tribal 

Governments 

I. Public Hearings 

MSHA will hold six public hearings 

on the proposed rule. The hearings will 

begin at 9 a.m., and will be held on the 

following dates and locations: 


sroberts on PROD1PC70 with PROPOSALS
Federal Register / Vol. 71, No. 174 / Friday, September 8, 2006 / Proposed Rules 53055 

Date Location Phone 

September 26, 2006 ................................ Mine Safety and Health Administration, 1100 Wilson Blvd, 25th Floor, Conference Room, Arlington, Virginia 22209.(202) 693–9440 

September 28, 2006 ................................ Sheraton Birmingham, 2101 Richard Arrington Jr. Blvd., North Birmingham, Alabama 35203.(205) 324–5000 

October 4, 2006 ...................................... Hilton Salt Lake City Center, 255 South West Temple, Salt Lake City, Utah 

84101.

(801) 238–2999 

October 6, 2006 ...................................... Hilton St. Louis Airport, 10330 Natural Bridge Road, St. Louis, Missouri 63134 ... (800) 314–2117 

October 17, 2006 .................................... Charleston Marriott Town Center, 200 Lee Street East, Charleston, West Virginia 

25301.

(304) 345–6500 

October 19, 2006 .................................... Pittsburgh Airport Marriott, 777 Aten Road, Coraopolis, Pennsylvania 15108 ....... (412) 490–6602 

Requests to speak at a hearing should 

be made at least five days prior to the 

hearing dates. Requests to speak may be 

made by telephone (202–693–9440), 

telefax (202) 693–9441, or mail (MSHA, 

Office of Standards, Regulations, and 

Variances, 1100 Wilson Blvd., Rm. 

2350, Arlington, Virginia 22209–3939). 

Any unallocated time at the hearings 

will be made available to persons 

making same-day requests to speak. 

The hearings will begin with an 

opening statement from MSHA, 

followed by an opportunity for members 

of the public to make oral presentations 

to a hearing panel. Speakers will be 

assigned in the order in which their 

requests are received. Speakers and 

other attendees may present written 

information or other articles to the 

MSHA panel for inclusion in the 

rulemaking record. 

The hearings will be conducted in an 

informal manner. The hearing panel 

may ask questions of speakers. Formal 

rules of evidence and cross examination 

will not apply. The presiding official 

may limit presentations and exclude 

irrelevant or unduly repetitious material 

and questions to ensure the orderly 

progress of the hearings. 

Transcripts of the hearings will be 

included in the rulemaking record. 

Copies of the transcripts will be 

available to the public, and can be 

viewed at http://www.msha.gov. 

MSHA will accept post-hearing 

written comments and other appropriate 

data for the record from any interested 

party, including those not presenting 

oral statements. Comments must be 

received at MSHA no later than October 

23, 2006. 

II. Background 

A. General 

The Mine Act requires MSHA to issue 

citations or orders to mine operators for 

any violations of a mandatory health or 

safety standard, rule, order, or 

regulation promulgated under the Mine 

Act. Upon issuing a citation, the 

Secretary’s authorized representative 

(inspector) specifies a time for the 

violation to be abated. If the operator 

does not abate the condition within the 

allowed time, the inspector may extend 

the time to abate or issue an order 

requiring all persons to be withdrawn 

from the area affected by the violation 

until the violation is abated. The Mine 

Act further requires assessment of civil 

monetary penalties for violations. 

Sections 105 and 110 of the Mine Act 

provide for the assessment of these 

penalties. The following six criteria in 

section 110(i) of the Mine Act are used 

to assess civil monetary penalties: 

(1) The appropriateness of the penalty 

to the size of the business of the 

operator charged; 

(2) The operator’s history of previous 

violations; 

(3) Whether the operator was 

negligent; 

(4) The gravity of the violation; 

(5) The demonstrated good faith of the 

operator charged in attempting to 

achieve rapid compliance after 

notification of a violation; and 

(6) The effect of the penalty on the 

operator’s ability to continue in 

business. 

MSHA proposes a civil penalty 

assessment for each violation. Upon 

receipt of the proposed assessment, the 

mine operator or other person has 30 

days to contest the assessment before 

the Federal Mine Safety and Health 

Review Commission (Commission), an 

independent adjudicatory agency 

established under the Mine Act. A 

proposed assessment that is not 

contested within 30 days becomes a 

final order of the Commission by 

operation of law and will not be subject 

to review by any court or agency. A 

proposed assessment that is contested 

before the Commission is reviewed by 

the Commission de novo. 

B. Rulemaking History 

On May 30, 1978, MSHA published 

its first final rule pertaining to the 

proposed assessment of civil penalties 

under the Mine Act for both coal mines 

and metal and nonmetal mines (47 FR 

22286). The maximum civil penalty that 

MSHA could assess under the Mine Act 

at that time was $10,000. 

The 1978 rule consisted of a twotiered system of assessing proposed 

penalties under either a regular 

assessment or a special assessment. 

Since 1978, MSHA has revised its civil 

penalty regulations in 30 CFR part 100 

essentially to: (1) Add a single penalty 

assessment provision; (2) change the 

assessment process to conform to a 

court order concerning history of 

violations; (3) increase penalty amounts 

due to legislative action; and (4) change 

penalty amounts and processes due to 

other compelling circumstances. 

Under the existing regulations, MSHA 

proposes penalties using a three-tiered 

process: (1) Regular assessments; (2) 

single penalty assessments; and (3) 

special assessments. The maximum civil 

penalty assessment is $60,000. The 

single penalty assessment is $60. The 

maximum daily civil penalty which 

may be assessed for failure to correct a 

violation within the time permitted is 

$6,500 and the maximum penalty for 

smoking or carrying smoking materials 

underground is $275. 

III. Discussion and Analysis of 

Proposed Changes to Part 100 

A. General Discussion 

MSHA is proposing to revise its 

procedures for assessing proposed civil 

penalties to update and increase 

penalties for violations of the standards 

and regulations promulgated under the 

Mine Act and to implement new civil 

penalty requirements in the MINER Act 

(Pub. L. 109–236). These new 

requirements address civil penalties 

related to prompt incident notification, 

and flagrant and unwarrantable 

violations. In accordance with MINER 

Act requirements, citations and orders 

issued on or after June 16, 2006, will be 

subject to the minimum penalties 

specified in the Act for violations 

involving failure to promptly notify 

MSHA within 15 minutes and 

unwarrantable failure. 

The intended purpose of civil 

penalties under the Mine Act is to 

‘‘convince operators to comply with the 

Act’s requirements.’’ (S. Rep. No. 181, 

95th Cong., 1st Sess. 45 (1977), 


sroberts on PROD1PC70 with PROPOSALS
53056 Federal Register / Vol. 71, No. 174 / Friday, September 8, 2006 / Proposed Rules 

reprinted in Senate Subcommittee on 

Labor, Committee on Human Resources, 

95th Cong., 2d Sess., Legislative History 

of the Federal Mine Safety and Health 

Act of 1977, at 633 (1978)). The 

Congress intended that the imposition 

of civil penalties would induce mine 

operators to be proactive in their 

approach to mine safety and health, and 

take necessary action to prevent safety 

and health hazards before they occur. In 

this proposal, the Agency is 

strengthening the civil penalty 

assessment regulations which will be an 

important tool in the reduction of 

fatalities and improvement in miner 

safety and health. 

Under MSHA’s existing procedures, a 

civil penalty can be assessed under the 

single penalty provision, the regular 

assessment provision, or the special 

assessment provision. The single 

penalty provision is applied to most 

violations that are not reasonably likely 

to result in a reasonably serious injury 

or illness (non-Significant and 

Substantial, or non-S&S) and that are 

abated in a timely manner, provided the 

operator does not have an excessive 

history of violations. The single penalty 

assessment is currently $60. 

The regular assessment is used to 

address most S&S violations, i.e., those 

that are reasonably likely to result in a 

reasonably serious injury or illness. 

Under the regular assessment provision, 

penalty points are assigned based on 

five statutory criteria: Operator’s size, 

history, negligence, demonstrated good 

faith towards abatement, and the gravity 

of the violation. The total points are 

then converted into a dollar amount. 

The resulting amount constitutes the 

proposed penalty unless, under the 

sixth statutory criterion, the operator 

shows that the penalty would adversely 

affect its ability to continue in business. 

Currently, the minimum regular 

assessment is $72 and the maximum 

regular assessment is $60,000 for each 

violation. 

Under the existing rule, MSHA 

reviews eight categories of violations for 

special assessment—those associated 

with fatalities as well as those 

associated with other aggravating 

circumstances. These are violations that 

MSHA believes, because of the 

particular circumstances surrounding 

the violation, should not be processed 

as a single penalty or regular 

assessment. The maximum special 

assessment is currently $60,000. 

MSHA reviewed the history of 

violations and penalty assessments at 

mines which have experienced fatal 

accidents recently. At these mines, 

MSHA found repeated violations of 

several standards for which the $60 

single penalty was assessed. MSHA also 

reviewed violations at all mines. The 

number of citations for violations of 

MSHA’s standards and regulations has 

been on the rise since 2003. 

Specifically, the number of all 

violations assessed increased from 

103,404 in 2003 to 116,731 in 2005. The 

number of violations that received a 

single penalty assessment increased 

from 69,078 in 2003 to 75,394 in 2005; 

the number of violations that received a 

regular assessment increased from 

32,608 in 2003 to 37,968 in 2005; and 

the number of violations that received a 

special assessment increased from 1,718 

in 2003 to 3,369 in 2005. 

MSHA is proposing to revise the civil 

penalty assessment process so that 

proposed penalties will increase 

proportionately to increases in operator 

size, history, and negligence and the 

gravity or seriousness of the violation. 

To accomplish this, the proposed rule 

would: 

(1) Reformulate the existing process of 

assigning points under the regular 

assessment provision; 

(2) Add a provision in an operator’s 

history addressing repeat violations; 

(3) Delete the existing single penalty 

assessment provision; 

(4) Revise the penalty conversion 

table by increasing the dollar value of 

each point assigned under the regular 

assessment provision; 

(5) Remove the limit on types of 

violations that MSHA will review for 

possible special assessment by removing 

the list of specific categories; 

(6) Shorten the time allowed to 

request a conference; and 

(7) Implement new requirements of 

the MINER Act. 

MSHA is proposing to delete the 

single penalty assessment provision. 

MSHA has reevaluated the single 

penalty provision and believes that the 

proposed rule reflects a more 

appropriate and effective approach to 

achieving the congressional purpose 

with respect to civil monetary penalties. 

MSHA is proposing to implement 

new penalty requirements in the MINER 

Act for prompt incident notification and 

flagrant violations in § 100.5. 

MSHA is proposing a new provision 

in § 100.4 to implement MINER Act 

requirements related to unwarrantable 

failure penalties. This provision sets 

minimum penalties for any citation or 

order issued under § 104(d) of the Mine 

Act. 

The proposed changes are intended to 

induce greater mine operator 

compliance with the Mine Act and 

MSHA’s safety and health standards, 

thereby improving safety and health for 

miners. The proposed changes are 

described in more detail in the 

following section-by-section analysis. 

B. Section-by-Section Analysis 

1. Scope and Purpose (§ 100.1) 

Existing § 100.1 would not change. 

2. Applicability (§ 100.2) 

Existing § 100.2 provides that the 

criteria and procedures in this part 

apply to all ‘‘evaluations and proposed 

assessments of civil penalties.’’ The 

proposed rule would remove the word 

‘‘evaluations’’ because the process of 

proposing assessments includes 

evaluations. This proposed section 

contains no substantive changes. 

3. Determination of Penalty; Regular 

Assessment (§ 100.3) 

a. General (§ 100.3(a)). Existing 

§ 100.3 establishes the formula to apply 

the statutory criteria to violations that 

are not processed under the existing 

single penalty assessment (§ 100.4) or 

special assessment (§ 100.5) provisions. 

This formula is an administrative 

mechanism used by MSHA to determine 

the appropriate penalty by applying the 

statutory criteria to particular facts 

surrounding a violation. Existing 

§ 100.3(a) lists the criteria described in 

§§ 105(b)(1)(B) and 110(i) of the Mine 

Act. The proposed rule makes several 

editorial changes for clarification and 

ease of reading, but makes no 

substantive changes to this section. 

b. Appropriateness of the penalty to 

the size of the operator’s business 

(§ 100.3(b)). Existing § 100.3(b) contains 

five tables assigning penalty points for 

size of coal mines, controlling entities of 

coal mines, metal and nonmetal mines, 

controlling entities of metal and 

nonmetal mines, and independent 

contractors. The size of coal mines and 

their controlling entities is measured by 

the amount of coal production. The size 

of metal and nonmetal mines and their 

controlling entities is measured by the 

number of hours worked. The size of 

independent contractors is measured by 

the total number of hours worked by the 

independent contractors at all mines 

regardless of the commodity being 

mined. 

Existing § 100.3(b) assigns up to 10 

penalty points for the size of mines or 

independent contractors based on a 

scale which consists of 11 levels. In 

addition, up to 5 penalty points are 

assigned for the size of the controlling 

entity of a coal mine or a metal or 

nonmetal mine. 

MSHA is proposing editorial changes 

to § 100.3(b) to make the provision 

easier to read. MSHA is also proposing 

to clarify the existing provision by 


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Federal Register / Vol. 71, No. 174 / Friday, September 8, 2006 / Proposed Rules 53057 

adding a statement concerning the way 

size of coal mines and metal and 

nonmetal mines is determined. The 

existing provision only states how the 

size of an independent contractor is 

determined. There are no proposed 

changes to the point table addressing 

the size of controlling entities. 

MSHA is proposing to increase the 

number of penalty points based on the 

operator’s size. Tables III–1, III–2, and 

III–3 show both the existing and 

proposed point schedules. The 

maximum number of penalty points for 

size would increase from 10 to 20 to 

assure that the amount of the penalty is 

an appropriate economic inducement of 

future compliance by the operator. The 

proposed point increase is based on 

MSHA’s analysis of existing size data 

for coal operators, metal and nonmetal 

operators, and independent contractors. 

According to the 2005 data, nearly 

half of the existing coal mines had 

annual tonnage of up to 15,000 tons. 

Slightly more than half of the existing 

metal and nonmetal mines had fewer 

than 10,000 annual hours worked. 

About half of independent contractors 

had fewer than 10,000 annual hours 

worked at all mines. Consistent with 

existing § 100.3(b), MSHA proposes that 

coal mines with an annual tonnage of 

up to 15,000 tons, metal and nonmetal 

mines with fewer than 10,000 hours 

worked, and independent contractors 

with fewer than 10,000 hours worked at 

all mines would all receive 0 penalty 

points for this criterion. 

Under the proposal, the remaining 

coal mines, i.e., those with annual 

tonnage levels above 15,000 tons; the 

remaining metal and nonmetal mines, 

i.e., those with annual hours worked 

above 10,000; and the remaining 

independent contractors, i.e., those with 

annual hours worked at all mines above 

10,000, would receive twice as many 

penalty points as under the existing 

rule, up to a maximum of 20. 

The proposed size schedule would 

result in penalties that are, on average, 

more than twice as high at the smallest 

(one to five employees) coal mines than 

at metal and nonmetal mines of similar 

size and over four times higher at coal 

mines in the five to 19 employee size 

range than similar sized metal and nonmetal mines. 

The proposed point structure in 

paragraph (b) is designed so that higher 

penalties would be computed for larger 

operations. This proposal is consistent 

with the Mine Act’s requirement to 

consider the size of the operation when 

assessing penalties. MSHA believes 

penalties assessed under the existing 

regulations are often too low to be an 

effective deterrent for noncompliance at 

some of the largest operations. 

The proposal, like the existing rule, 

places greater emphasis on size of the 

mine than on size of the controlling 

entity in assigning penalty points. The 

Agency solicits comments on whether, 

in considering the size of the operator, 

greater weight should be placed on the 

size of the controlling entity. 

TABLE III–1.—SIZE OF COAL MINE: ANNUAL TONNAGE OF MINE

Annual tonnage of mine 

Existing 

penalty 

points 

Proposed 

penalty 

points 

0 to 15,000 ....................................................................................................................................................................... 0 0 

Over 15,000 to 30,000 ..................................................................................................................................................... 1 2 

Over 30,000 to 50,000 ..................................................................................................................................................... 2 4 

Over 50,000 to 100,000 ................................................................................................................................................... 3 6 

Over 100,000 to 200,000 ................................................................................................................................................. 4 8 

Over 200,000 to 300,000 ................................................................................................................................................. 5 10 

Over 300,000 to 500,000 ................................................................................................................................................. 6 12 

Over 500,000 to 800,000 ................................................................................................................................................. 7 14 

Over 800,000 to 1.1 million ............................................................................................................................................. 8 16 

Over 1.1 million to 2 million ............................................................................................................................................. 9 18 

Over 2 million ................................................................................................................................................................... 10 20 

TABLE III–2.—SIZE OF METAL AND NONMETAL MINE: ANNUAL HOURS WORKED AT MINE

Annual hours worked at mine 

Existing 

penalty 

points 

Proposed 

penalty 

points 

0 to 10,000 ....................................................................................................................................................................... 0 0 

Over 10,000 to 20,000 ..................................................................................................................................................... 1 2 

Over 20,000 to 30,000 ..................................................................................................................................................... 2 4 

Over 30,000 to 60,000 ..................................................................................................................................................... 3 6 

Over 60,000 to 100,000 ................................................................................................................................................... 4 8 

Over 100,000 to 200,000 ................................................................................................................................................. 5 10 

Over 200,000 to 300,000 ................................................................................................................................................. 6 12 

Over 300,000 to 500,000 ................................................................................................................................................. 7 14 

Over 500,000 to 700,000 ................................................................................................................................................. 8 16 

Over 700,000 to 1 million ................................................................................................................................................ 9 18 

Over 1 million ................................................................................................................................................................... 10 20 

TABLE III–3.—SIZE OF INDEPENDENT CONTRACTOR: ANNUAL HOURS WORKED AT ALL MINES

Annual hours worked at all mines 

Existing 

penalty 

points 

Proposed 

penalty 

points 

0 to 10,000 ....................................................................................................................................................................... 0 0 

Over 10,000 to 20,000 ..................................................................................................................................................... 1 2 

Over 20,000 to 30,000 ..................................................................................................................................................... 2 4 


sroberts on PROD1PC70 with PROPOSALS
53058 Federal Register / Vol. 71, No. 174 / Friday, September 8, 2006 / Proposed Rules 

TABLE III–3.—SIZE OF INDEPENDENT CONTRACTOR: ANNUAL HOURS WORKED AT ALL MINES—Continued 

Annual hours worked at all mines 

Existing 

penalty 

points 

Proposed 

penalty 

points 

Over 30,000 to 60,000 ..................................................................................................................................................... 3 6 

Over 60,000 to 100,000 ................................................................................................................................................... 4 8 

Over 100,000 to 200,000 ................................................................................................................................................. 5 10 

Over 200,000 to 300,000 ................................................................................................................................................. 6 12 

Over 300,000 to 500,000 ................................................................................................................................................. 7 14 

Over 500,000 to 700,000 ................................................................................................................................................. 8 16 

Over 700,000 to 1 million ................................................................................................................................................ 9 18 

Over 1 million ................................................................................................................................................................... 10 20 

c. History of previous violations 

(§ 100.3(c)). Existing § 100.3(c) bases the 

operator’s violation history on the 

number of violations received in a 

preceding 24-month period for which a 

civil penalty has been paid or finally 

adjudicated. For production operators, 

penalty points are calculated using the 

average number of violations per 

inspection day (VPID). For independent 

contractors, penalty points are 

calculated using the annual average 

number of violations at all mines in a 

preceding 24-month period. The 

proposal would add the phrase ‘‘or have 

become final orders of the Commission’’

in the second sentence of this 

paragraph. The proposal would retain 

MSHA’s intent that only violations 

which have become final be included in 

an operator’s history. 

MSHA is proposing three several 

substantive changes to existing 

§ 100.3(c). First, MSHA is proposing 

that violation history include two 

components: (1) Paragraph (c)(1) would 

address the total number of violations; 

and (2) paragraph (c)(2) would address 

the number of repeat violations of the 

same standard. Second, an operator’s or 

independent contractor’s history of 

violations would be based on a 

preceding 15-month period rather than 

a 24-month period. This change would 

apply to both components—overall 

history and repeat violations—of 

history. Third, MSHA is proposing to 

change the point tables for overall 

history and to add a new point table 

addressing repeat violations of the same 

standard. Finally, MSHA is proposing to 

revise the calculation that addresses the 

overall history of an independent 

contractor. 

MSHA is proposing to reduce the 24- 

month review period to a 15-month 

review period because the agency 

believes that a period of 15 months 

would more accurately reflect an 

operator’s current state of compliance. 

This change would provide MSHA with 

sufficient data to appropriately 

determine an operator’s compliance 

record, including any trend, even for 

mining operations that are inspected on 

a less frequent basis. This change would 

provide an incentive for improving 

safety and health to an operator that has 

a deteriorating safety and health record 

in the recent past. 

Proposed § 100.3(c)(1) addresses the 

overall history of production operators 

and independent contractors. MSHA 

would continue to assign penalty points 

for production operators based on the 

number of assessed violations per 

inspection day. MSHA is proposing to 

increase the points assigned to the five 

highest levels of the VPID table. The 

highest level would be assigned the 

maximum of 25 points. MSHA is 

proposing to increase penalty points 

starting from the ‘‘over 1.3 to 1.5’’ level 

or mid-level of the VPID table because 

MSHA believes that operators of mines 

with a VPID in the mid- and upper 

levels show the least concern for 

compliance with the Mine Act and 

MSHA safety and health standards and 

regulations. Higher penalties for such 

operators may encourage them to 

comply with the Mine Act’s 

requirements. 

Under proposed § 100.3(c)(1), 

production operators with fewer than 10 

assessed violations in a preceding 15- 

month period would not receive points. 

This proposed provision is similar to 

existing § 100.4(b) pertaining to 

excessive history. The proposed 

provision takes into consideration small 

mines that may receive a low number of 

inspection days in a preceding 15- 

month period. In such small operations, 

even though the total number of 

violations may be low, the VPID could 

easily be greater than the highest 2.1 

VPID level. These small operations, 

however, are not necessarily the ones 

which MSHA is targeting in this aspect 

of the history criterion, since such a 

record may not reflect systemic 

problems of noncompliance. MSHA 

believes that these small operators 

should not receive points under this 

aspect of this criterion. 

Under proposed § 100.3(c)(1), the 

number of violations for independent 

contractors would no longer be based on 

the average number of assessed 

violations per year at all mines as it is 

under existing § 100.3(c). The number of 

violations for independent contractors 

would be based on the total number of 

assessed violations at all mines during 

a preceding 15-month period. Since the 

Agency proposes to reduce the history 

time period from 24 to 15 months, this 

eliminates the need for an annual 

average. MSHA estimates that this 

change may result in a de minimis 

increase in the average assessment 

issued to independent contractors. The 

proposed point table reflects this 

change. MSHA solicits comments on 

this proposed approach to determining 

violation history for independent 

contractors, i.e., whether an annualized 

average should continue to be used. For 

independent contractors, MSHA is 

proposing to increase the number of 

penalty points for the levels starting 

with ‘‘over 30 to 35’’ and above and to 

increase the maximum number of points 

for this aspect of the history criterion 

from 20 to 25. MSHA believes that 

independent contractors with a greater 

number of violations in the preceding 

15-month period show the least concern 

for compliance with the Mine Act and 

MSHA safety and health standards and 

regulations. MSHA intends that this 

aspect of the history criterion would 

serve as greater inducement for such 

operators to comply with the Mine Act 

and MSHA’s safety and health standards 

and regulations. MSHA therefore 

proposes to increase the points for the 

upper five levels of the number of 

violations. See tables III–4 and III–5 for 

a comparison of the existing and 

proposed penalty point scales for 

production operators and independent 

contractors, respectively. 


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TABLE III–4.—PRODUCTION OPERATOR’S OVERALL HISTORY OF VIOLATIONS: AVERAGE NUMBER OF VIOLATIONS PER INSPECTION DAY

Violations per inspection day 

Existing 

penalty 

points 

Proposed 

penalty 

points 

0 to 0.3 ............. 0 0 

Over 0.3 to 0.5 2 2 

Over 0.5 to 0.7 4 4 

Over 0.7 to 0.9 6 6 

Over 0.9 to 1.1 8 8 

Over 1.1 to 1.3 10 10 

Over 1.3 to 1.5 12 13 

Over 1.5 to 1.7 14 16 

Over 1.7 to 1.9 16 19 

Over 1.9 to 2.1 18 22 

Over 2.1 ............ 20 25 

TABLE III–5.—INDEPENDENT CONTRACTOR’S OVERALL HISTORY OF VIOLATIONS

Number of violations 

Existing 

penalty 

points 

Proposed 

penalty 

points 

0 to 5 ................ 0 0 

Over 5 to 10 ..... 2 2 

Over 10 to 15 ... 4 4 

Over 15 to 20 ... 6 6 

Over 20 to 25 ... 8 8 

Over 25 to 30 ... 10 10 

Over 30 to 35 ... 12 13 

Over 35 to 40 ... 14 16 

Over 40 to 45 ... 16 19 

Over 45 to 50 ... 18 22 

Over 50 ............. 20 25 

Proposed § 100.3(c)(2) would add a 

new component to the history criterion: 

Repeat violations of the same standard. 

The number of repeat violations of the 

same standard in a preceding 15-month 

period would be part of the operator’s 

history of violations. For the purpose of 

determining repeat violations, each 

citable standard would be considered a 

separate ‘‘standard.’’ Repeat violations 

of the same standard would include 

only assessed violations of the relevant 

standard that are paid or finally 

adjudicated, or became final orders of 

the Commission. For example, previous 

assessments for violations of § 75.202(a) 

would not be included in the repeat 

history for a violation of § 75.202(b). 

Similarly, previous assessments for 

violations of § 56.14101(a)(1) would not 

be included in the repeat history for a 

violation of § 56.14101(a)(2). MSHA 

requests comments on this approach to 

determining repeat violations. In 

addition, MSHA solicits comments on 

whether, in determining penalty points 

for repeat violations of the same 

standard, the Agency should factor in 

the number of inspection days during 

which the repeat violations were cited. 

MSHA also solicits comments on 

whether only S&S violations should be 

considered in determining repeat 

violations of the same standard. 

A maximum of 20 penalty points 

could be assigned using this new 

component of the history criterion. 

MSHA is proposing this new provision 

because the Agency believes that 

operators who repeatedly violate the 

same standard may indicate an attitude 

which has little regard for getting to the 

root cause of violations of safe and 

healthful working conditions. The 

Agency believes that these operators 

show a lack of commitment to good 

mine safety and health practices by 

letting cited and corrected hazardous 

conditions recur. 

The analysis of assessments for the 

15-month period from January 1, 2005, 

through March 31, 2006 reveals that 698 

of the 10,227 mines with violations each 

had at least six violations of the same 

standard. Furthermore, 99 of the 698 

mines had more than twenty violations 

of the same standard during the 15 

month period. MSHA believes that the 

Agency needs to adjust its civil penalty 

structure so that the penalties can more 

appropriately serve as a deterrent to this 

type of behavior, thereby resulting in 

greater compliance and more effective 

mine safety and health. 

Under proposed § 100.3(c)(2), an 

operator with five or fewer repeat 

violations of the same standard in a 

preceding 15-month period would not 

receive penalty points. MSHA believes 

that that this new component of the 

history criterion should be applied to 

those operators who violate the same 

standard with a certain degree of 

repetition. Under the proposal, 

operators could receive a maximum of 

20 penalty points for this aspect of the 

history criterion. MSHA believes that 

this new proposal will encourage greater 

operator compliance with the Mine Act 

and MSHA’s safety and health standards 

and regulations, which is consistent 

with Congress’ intent. 

Penalty points proposed to be 

assigned to the number of repeat 

violations of the same standard are 

presented in Table III–6. 

TABLE III–6.—NEW TABLE ADDRESSING REPEAT VIOLATIONS OF THE

SAME STANDARD

Number of violations Penalty 

points 

5 or fewer ..................................... 0 

6 .................................................... 1 

7 .................................................... 2 

8 .................................................... 3 

9 .................................................... 4 

TABLE III–6.—NEW TABLE ADDRESSING REPEAT VIOLATIONS OF THE

SAME STANDARD—Continued 

Number of violations Penalty 

points 

10 .................................................. 5 

11 .................................................. 6 

12 .................................................. 7 

13 .................................................. 8 

14 .................................................. 9 

15 .................................................. 10 

16 .................................................. 11 

17 .................................................. 12 

18 .................................................. 14 

19 .................................................. 16 

20 .................................................. 18 

More than 20 ................................ 20 

d. Negligence (§ 100.3(d)). Existing 

§ 100.3(d) provides for evaluating the 

degree of negligence involved in a 

violation under 5 categories: No 

negligence, which means that the 

operator exercised diligence and could 

not have known of the violative 

condition or practice; low negligence, 

which means that the operator knew or 

should have known of the violative 

condition or practice, but there are 

considerable mitigating circumstances; 

moderate negligence, which means that 

the operator knew or should have 

known of the violative condition or 

practice, but there are mitigating 

circumstances; high negligence, which 

means the operator knew or should have 

known of the violative condition or 

practice, and there are no mitigating 

circumstances; and reckless disregard, 

which means the operator displayed 

conduct which exhibits the absence of 

the slightest degree of care. An 

increased number of penalty points is 

assigned to the higher levels of 

negligence. The maximum number of 

points for negligence is 25 under 

existing § 100.3(d). 

Proposed § 100.3(d) would retain the 

existing five levels of negligence, but 

would increase the maximum number of 

penalty points from 25 to 50 so that 

more penalty points would be assigned 

to operators who exhibit increasingly 

higher levels of negligence, i.e., a lack 

of care towards protection of miners 

from safety and health hazards. Under 

the proposed table, points for no 

negligence and low negligence would 

not change. Penalty points assigned 

under the three highest levels of 

negligence would increase more rapidly 

than under the existing regulation. 

Moderate negligence would add 20 

points rather than 15 points as under 

the existing regulation; high negligence 

would add 35 points rather than the 20 

points under the existing regulation; 

and reckless disregard would add 50 


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points rather than 25 points as under 

the existing regulation. 

Table III–7 compares penalty points 

in existing and proposed § 100.3(d). 

TABLE III–7.—NEGLIGENCE

Categories 

Existing 

penalty 

points 

Proposed 

penalty 

points 

No negligence .................................................................................................................................................................. 0 0 

(The operator exercised diligence and could not have known of the violative condition or practice.) 

Low negligence ................................................................................................................................................................ 10 10 

(The operator knew or should have known of the violative condition or practice, but there are considerable mitigating circumstances.) 

Moderate negligence ....................................................................................................................................................... 15 20 

(The operator knew or should have known of the violative condition or practice, but there are mitigating circumstances.) 

High negligence ............................................................................................................................................................... 20 35 

(The operator knew or should have known of the violative condition or practice, but there are mitigating circumstances.) 

Reckless disregard .......................................................................................................................................................... 25 50 

(The operator displayed conduct which exhibits the absence of the slightest degree of care.) 

e. Gravity (§ 100.3(e)). Existing 

§ 100.3(e) uses three factors to measure 

the gravity of a violation:(1) Likelihood 

of occurrence of an event, (2) severity of 

injury or illness if the event occurred or 

were to occur, and (3) the number of 

persons potentially affected if the event 

occurred or were to occur. A maximum 

of 10 penalty points may be assigned 

from each of the three factors, for a 

maximum of 30 points for the gravity 

criterion. 

Proposed § 100.3(e) would retain the 

three measures of gravity, but would 

change the number of penalty points 

assigned for each. The maximum 

number of points assigned for likelihood 

of occurrence of an event would 

increase from 10 to 50, the maximum 

number of points assigned for severity 

of injury or illness would increase from 

10 to 20, and the maximum number of 

points assigned for the number of 

persons potentially affected would 

increase from 10 to 18. In addition, the 

number of categories in the Persons 

Potentially Affected Table would 

increase from 7 to 11. The total points 

that could be assigned for the gravity 

criterion would increase from 30 to 88. 

MSHA is proposing to adjust the 

number of penalty points that may be 

assigned under the gravity criterion to 

focus attention on the more serious 

mine safety and health hazards. MSHA 

believes that the penalty points in the 

proposed gravity tables will result in 

mine operators placing greater emphasis 

on correcting the more serious 

violations because they pose the greatest 

safety and health risk to miners. The 

proposal distinguishes the less serious 

violations so that they would receive an 

appropriate penalty under the regular 

assessment formula. Existing § 100.3(e) 

has also been reworded for easier 

reading. Tables III–8 through III–10 

show both the existing and the proposed 

penalty points for likelihood, gravity, 

and persons potentially affected. 

TABLE III–8.—LIKELIHOOD

Likelihood of occurrence 

Existing 

penalty 

points 

Proposed 

penalty 

points 

No likelihood .................................................................................................................................................................... 0 0 

Unlikely ............................................................................................................................................................................ 2 10 

Reasonably likely ............................................................................................................................................................. 5 30 

Highly likely ...................................................................................................................................................................... 7 40 

Occurred .......................................................................................................................................................................... 10 50 

TABLE III–9.—SEVERITY

Severity of injury or illness if the event occurred or were to occur 

Existing 

penalty 

points 

Proposed 

penalty 

points 

No lost work days ............................................................................................................................................................ 0 0 

(All occupational injuries and illnesses as defined in 30 CFR part 50 except those listed below.) 

Lost work days or restricted duty .................................................................................................................................... 3 5 

(Any injury or illness which would cause the injured or ill person to lose one full day of work or more after the day 

of the injury or illness, or which would cause one full day or more of restricted duty.) 

Permanently disabling ..................................................................................................................................................... 7 10 

(Any injury or illness which would be likely to result in the total or partial loss of the use of any member or function 

of the body.) 

Fatal ................................................................................................................................................................................. 10 20 

(Any work-related injury or illness resulting in death, or which has a reasonable potential to cause death.) 


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TABLE III–10.—PERSONS POTENTIALLY AFFECTED

Number of persons potentially affected if the event occurred or were to occur 

Existing scale Existing 

points Proposed scale Proposed points 

0 .......................................................................................... 0 0 .......................................................................................... 0 

1 .......................................................................................... 1 1 .......................................................................................... 1 

2 .......................................................................................... 2 2 .......................................................................................... 2 

3 .......................................................................................... 4 3 .......................................................................................... 4 

4 to 5 ................................................................................... 6 4 .......................................................................................... 6 

6 to 9 ................................................................................... 8 5 .......................................................................................... 8 

More than 9 ........................................................................ 10 6 .......................................................................................... 10 

7 .......................................................................................... 12 

8 .......................................................................................... 14 

9 .......................................................................................... 16 

10 or more .......................................................................... 18 

f. Demonstrated good faith of the 

operator in abating the violation 

(§ 100.3(f)). Existing § 100.3(f) allows for 

a 30% reduction in the amount of a 

regular assessment where the operator 

abates the violation within the time set 

by the inspector. When the operator 

does not abate the violation within the 

time set by the inspector, 10 penalty 

points are assigned. 

Proposed § 100.3(f) would decrease 

the amount of the reduction from 30% 

to 10% where an operator abates a 

violation within the time set by the 

inspector. MSHA believes this is a more 

appropriate reduction because operators 

are required by law to timely abate 

violations. 

MSHA is also proposing to delete the 

existing provision which assigns ten 

additional penalty points where an 

operator does not abate the violation 

within the specified time period. The 

Mine Act provides two sanctions for 

failure to correct violations within the 

time set by the inspector: § 104(b) 

requires a withdrawal order, which 

effectively shuts down production in 

the area affected, and § 110(b) allows 

assessment of a daily penalty. 

MSHA has reviewed the civil penalty 

assessment data for the last several years 

and believes that the proposed 10% 

good faith reduction is a more 

appropriate credit for mine operators 

who promptly correct hazardous 

conditions. 

g. Penalty conversion table 

(§ 100.3(g)). Existing § 100.3(g) provides 

the penalty conversion table used to 

convert total penalty points to a dollar 

amount. The existing dollar amounts 

range from $72 to $60,000, and 

correspond to penalty points ranging 

from 20 or fewer to 100. 

Under the proposed penalty 

conversion table, MSHA would retain 

the statutory maximum penalty of 

$60,000, but would establish a new 

minimum penalty of $112. The 

proposed dollar amounts would 

correspond to penalty points ranging 

from 60 or fewer to 140. 

The proposed penalty conversion 

table is derived by combining two 

methods of converting points to dollars. 

There is a lower section (from 60 or 

fewer to 133 points) and an upper 

section (above 133 points) of the 

proposed conversion table. The 

proposed table starts at $112 when the 

number of points is 60 or fewer. Each 

additional point above 60 up to 133 

causes the dollar value to increase by a 

fixed 8.33%. The dollar value assigned 

for 133 points is $38,387. Above 133 

points the dollar value increases by 

approximately $3,070 for each penalty 

point. The maximum number of points 

is 140 and the maximum dollar value is 

$60,000. 

When applied to MSHA’s 2005 

assessment data, the penalty amounts 

under the proposed conversion table 

increase generally as severity of the 

violation and violation history increase. 

Section III of this preamble provides 

data showing the increased penalty 

amounts under the proposal. Table III–

12 shows the existing and the proposed 

penalty conversion tables. 

TABLE III–12.—EXISTING AND PROPOSED PENALTY POINT CONVERSION TABLES

Current points Current 

penalties Proposed points Proposed penalties 

20 or fewer ........................................................................ $72 60 or fewer ....................................................................... $112 

21 ...................................................................................... 80 61 ..................................................................................... 121 

22 ...................................................................................... 87 62 ..................................................................................... 131 

23 ...................................................................................... 94 63 ..................................................................................... 142 

24 ...................................................................................... 101 64 ..................................................................................... 154 

25 ...................................................................................... 109 65 ..................................................................................... 167 

26 ...................................................................................... 120 66 ..................................................................................... 181 

27 ...................................................................................... 131 67 ..................................................................................... 196 

28 ...................................................................................... 142 68 ..................................................................................... 212 

29 ...................................................................................... 153 69 ..................................................................................... 230 

30 ...................................................................................... 164 70 ..................................................................................... 249 

31 ...................................................................................... 178 71 ..................................................................................... 270 

32 ...................................................................................... 193 72 ..................................................................................... 293 

33 ...................................................................................... 207 73 ..................................................................................... 317 

34 ...................................................................................... 221 74 ..................................................................................... 343 

35 ...................................................................................... 237 75 ..................................................................................... 372 

36 ...................................................................................... 254 76 ..................................................................................... 403 

37 ...................................................................................... 273 77 ..................................................................................... 436 

38 ...................................................................................... 291 78 ..................................................................................... 473 


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TABLE III–12.—EXISTING AND PROPOSED PENALTY POINT CONVERSION TABLES—Continued 

Current points Current 

penalties Proposed points Proposed penalties 

39 ...................................................................................... 310 79 ..................................................................................... 512 

40 ...................................................................................... 327 80 ..................................................................................... 555 

41 ...................................................................................... 354 81 ..................................................................................... 601 

42 ...................................................................................... 383 82 ..................................................................................... 651 

43 ...................................................................................... 409 83 ..................................................................................... 705 

44 ...................................................................................... 437 84 ..................................................................................... 764 

45 ...................................................................................... 463 85 ..................................................................................... 828 

46 ...................................................................................... 500 86 ..................................................................................... 897 

47 ...................................................................................... 536 87 ..................................................................................... 971 

48 ...................................................................................... 629 88 ..................................................................................... 1,052 

49 ...................................................................................... 749 89 ..................................................................................... 1,140 

50 ...................................................................................... 878 90 ..................................................................................... 1,235 

51 ...................................................................................... 1,033 91 ..................................................................................... 1,337 

52 ...................................................................................... 1,198 92 ..................................................................................... 1,449 

53 ...................................................................................... 1,376 93 ..................................................................................... 1,569 

54 ...................................................................................... 1,566 94 ..................................................................................... 1,700 

55 ...................................................................................... 1,769 95 ..................................................................................... 1,842 

56 ...................................................................................... 2,003 96 ..................................................................................... 1,995 

57 ...................................................................................... 2,252 97 ..................................................................................... 2,161 

58 ...................................................................................... 2,515 98 ..................................................................................... 2,341 

59 ...................................................................................... 2,793 99 ..................................................................................... 2,536 

60 ...................................................................................... 3,086 100 ................................................................................... 2,748 

61 ...................................................................................... 3,419 101 ................................................................................... 2,976 

62 ...................................................................................... 3,770 102 ................................................................................... 3,224 

63 ...................................................................................... 4,137 103 ................................................................................... 3,493 

64 ...................................................................................... 4,521 104 ................................................................................... 3,784 

65 ...................................................................................... 4,856 105 ................................................................................... 4,099 

66 ...................................................................................... 5,099 106 ................................................................................... 4,440 

67 ...................................................................................... 5,342 107 ................................................................................... 4,810 

68 ...................................................................................... 5,585 108 ................................................................................... 5,211 

69 ...................................................................................... 5,828 109 ................................................................................... 5,645 

70 ...................................................................................... 6,071 110 ................................................................................... 6,115 

71 ...................................................................................... 6,374 111 ................................................................................... 6,624 

72 ...................................................................................... 6,678 112 ................................................................................... 7,176 

73 ...................................................................................... 6,981 113 ................................................................................... 7,774 

74 ...................................................................................... 7,285 114 ................................................................................... 8,421 

75 ...................................................................................... 7,588 115 ................................................................................... 9,122 

76 ...................................................................................... 7,892 116 ................................................................................... 9,882 

77 ...................................................................................... 8,499 117 ................................................................................... 10,705 

78 ...................................................................................... 9,106 118 ................................................................................... 11,597 

79 ...................................................................................... 9,713 119 ................................................................................... 12,563 

80 ...................................................................................... 10,321 120 ................................................................................... 13,609 

81 ...................................................................................... 11,535 121 ................................................................................... 14,743 

82 ...................................................................................... 12,749 122 ................................................................................... 15,971 

83 ...................................................................................... 13,963 123 ................................................................................... 17,301 

84 ...................................................................................... 15,177 124 ................................................................................... 18,742 

85 ...................................................................................... 16,392 125 ................................................................................... 20,302 

86 ...................................................................................... 18,213 126 ................................................................................... 21,993 

87 ...................................................................................... 20,642 127 ................................................................................... 23,825 

88 ...................................................................................... 23,070 128 ................................................................................... 25,810 

89 ...................................................................................... 25,498 129 ................................................................................... 27,959 

90 ...................................................................................... 27,927 130 ................................................................................... 30,288 

91 ...................................................................................... 30,355 131 ................................................................................... 32,810 

92 ...................................................................................... 33,391 132 ................................................................................... 35,543 

93 ...................................................................................... 36,427 133 ................................................................................... 38,503 

94 ...................................................................................... 39,462 134 ................................................................................... 41,574 

95 ...................................................................................... 42,498 135 ................................................................................... 44,645 

96 ...................................................................................... 45,533 136 ................................................................................... 47,716 

97 ...................................................................................... 48,569 137 ................................................................................... 50,787 

98 ...................................................................................... 51,605 138 ................................................................................... 53,858 

99 ...................................................................................... 54,640 139 ................................................................................... 56,929 

100 .................................................................................... 60,000 140 or more ...................................................................... 60,000 

The range of points in the proposed 

conversion table to reflects proposed 

changes in the individual criteria tables 

in proposed § 100.3. The minimum 

penalty in the proposed conversion 

table would be changed from $72 to 

$112. MSHA believes that this would 

represent a reasonable adjustment for 

many of the violations processed under 

the existing regulations as single penalty 

assessments. Typically, single penalty 

assessments address non-S&S and 

paperwork type violations. The 

maximum penalty would remain at 

$60,000 per violation. 


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h. Effect on operator’s ability to 

remain in business (§ 100.3(h)). Existing 

§ 100.3(h) provides that MSHA 

presumes that the operator’s ability to 

continue in business will not be affected 

by payment of a civil penalty. In 

addition, it provides that MSHA may 

adjust the penalty if the operator 

submits information to MSHA 

concerning the business financial status 

which shows that payment of the 

penalty will adversely affect the 

operator’s ability to continue in 

business. MSHA is proposing several 

editorial changes for easier reading and 

clarity, but there would be no 

substantive change to existing 

§ 100.3(h). 

4. Determination of Penalty; Single 

Penalty Assessment (§ 100.4) 

Existing § 100.4 provides for a $60 

penalty for non-S&S violations, i.e., 

those that are not reasonably likely to 

result in reasonably serious injury or 

illness. The single penalty assessment is 

available only if the violation is abated 

within the time set by the inspector and 

the operator does not have an excessive 

history of violations. The existing 

provision defines excessive violation 

history. 

MSHA is proposing to delete the 

single penalty assessment provision in 

§ 100.4 based on an evaluation of agency 

data and a review of experience gained 

under the provision. The primary focus 

of the Mine Act, as reiterated in the 

MINER Act, is on the prevention and 

correction of violative conditions before 

they occur and the improvement of the 

safety and health of miners. MSHA 

believes that deletion of the single 

penalty provision will have a positive 

impact on miner safety and health. 

MSHA believes that deleting the single 

penalty provision will provide a greater 

incentive for mine operators to abate 

hazards. The Agency believes that 

deleting the single penalty provision 

will cause mine operators to focus their 

attention on preventing all hazardous 

conditions before they occur and 

promptly correct those violations that 

do occur. Therefore, MSHA is proposing 

to delete the single penalty provision. 

5. Unwarrantable Failure (§ 100.4) 

Proposed § 100.4 would implement 

the MINER Act requirements related to 

minimum unwarrantable failure 

penalties. Section 8(a)(1)(B) of the 

MINER Act amends the Mine Act by 

setting a minimum penalty of $2,000 for 

any citation or order issued under 

section 104(d)(1) and a minimum 

penalty of $4,000 for any order issued 

under section 104(d)(2). 

6. Determination of Penalty; Special 

Assessment (§ 100.5) 

Existing § 100.5 provides for a special 

assessment for those violations which 

MSHA believes should not be processed 

under the provision for a single penalty 

assessment or under the regular 

assessment provision. 

Consistent with the proposal to delete 

the single penalty provision, MSHA is 

proposing to revise the first sentence in 

paragraph (a) of this section. The 

revision would remove the reference to 

the single assessment provision. MSHA 

proposes to remove the second sentence 

in existing paragraph (a) of § 100.5 that 

provides a general explanation stating 

when a special assessment would be 

applied. This sentence is ‘‘Although an 

effective penalty can generally be 

derived by using the regular assessment 

formula and the single assessment 

provision, some types of violations may 

be of such a nature or seriousness that 

it is not possible to determine an 

appropriate penalty under these 

provisions.’’ This sentence is 

unnecessary because the first sentence 

specifies that it is within MSHA’s 

discretion to waive the regular 

assessment depending upon the 

conditions surrounding the violation. 

MSHA proposes to remove the list of 

eight categories of violations that will be 

reviewed for possible special 

assessment under existing § 100.5(b). As 

stated in existing and proposed 

§ 100.5(a), MSHA has the discretion to 

waive the regular assessment formula if 

it determines that conditions warrant a 

special assessment for any type of 

violation. The existing list of eight 

categories of violations that MSHA 

would review, although not intended to 

be exclusive, resulted in a timeconsuming and resource-intensive 

process. Under the proposed rule, 

MSHA would retain its discretion to 

determine which types of violations 

would be reviewed for a special 

assessment, without being limited to a 

specific list. MSHA anticipates that, 

under the proposal, the regular 

assessment provision would generally 

provide an appropriate penalty in most 

cases. This change will allow MSHA to 

focus its enforcement resources on more 

field enforcement activities, as opposed 

to administrative review activities. 

There would be circumstances, 

however, in which the regular 

assessment would not provide an 

appropriate penalty and thus the special 

assessment provision would be applied. 

Changes in proposed § 100.5(b) would 

provide for easier reading and clarity 

and would be revised to include 

references to sections 105(b) and 110(i) 

of the Mine Act. The reference to 

§ 100.4(b) would be removed as the 

single penalty provision would be 

deleted. Paragraphs (c) and (d) would 

remain unchanged. 

Proposed paragraphs (e) and (f) would 

implement new civil penalty provisions 

of the MINER Act. New paragraph (e) 

addresses penalties for flagrant 

violations. Under the MINER Act 

amendments to the Mine Act, violations 

that are deemed to be flagrant may be 

assessed a civil penalty of not more than 

$220,000. A ‘‘flagrant’’ violation is 

defined as a reckless or repeated failure 

to make reasonable efforts to eliminate 

a known violation of a mandatory health 

or safety standard that substantially and 

proximately caused, or reasonably could 

have been expected to cause, death or 

serious bodily injury. Under the 

proposal these violations would be 

processed as a special assessment. 

New paragraph (f) addresses penalties 

related to prompt incident notification. 

Under the MINER Act amendments to 

the Mine Act, an operator who fails to 

provide timely notification to the 

Secretary under section 103(j) (relating 

to the 15-minute requirement) shall be 

assessed a civil penalty of not less than 

$5,000 and not more than $60,000. 

Violations under this new paragraph 

would be processed as a special 

assessment. 

7. Procedures for Review of Citations 

and Orders; Procedures for Assessment 

of Civil Penalties and Conferences 

(§ 100.6) 

Existing § 100.6 contains 

requirements and administrative 

procedures for review of citations and 

orders. Proposed § 100.6 remains 

substantively the same as existing 

§ 100.6. MSHA believes that safety and 

health is improved when mine operators 

and miners or their representatives are 

afforded an opportunity to discuss 

safety and health issues after an 

inspection with the MSHA District 

Manager or designee. Like existing 

§ 100.6, initial review of the citation or 

order would be conducted during the 

inspection closeout conference or at a 

time reasonably convenient to operators 

and miners or their representatives. In 

addition, the proposal, like the existing 

rule, allows the operator and miners or 

their representative to submit additional 

facts or to request a safety and health 

conference. Any of these parties may 

request to be notified of, and participate 

in, a safety and health conference 

initiated by one of the other parties. 

Safety and health conference requests 

would continue to be made with the 

MSHA District Office. When a request is 


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53064 Federal Register / Vol. 71, No. 174 / Friday, September 8, 2006 / Proposed Rules 

granted, conferences will be promptly 

conducted. 

Proposed paragraph 100.6(a) contains 

editorial changes which incorporate 

concepts from existing paragraphs 

100.6(a) and (c). Under proposed 

§ 100.6(a), the review process would 

continue to provide any operator, and 

miners or their representatives, with an 

opportunity to (1) review the citation or 

order with MSHA, (2) submit additional 

information to MSHA, and (3) request a 

safety and health conference with the 

District Manager or designee. In 

addition, the provision in existing 

§ 100.6(c), which provides that a request 

for a conference is within MSHA’s 

discretion, would be moved to this 

paragraph. 

Proposed § 100.6(b) would reduce the 

time, from ten days to five days, to 

submit additional information or 

request a safety and health conference. 

MSHA believes that the proposed 

reduction would result in a more 

effective civil penalty system because 

penalties would be assessed closer in 

time to the issuance of the citation. 

MSHA believes that all parties would be 

able to request a health and safety 

conference within this timeframe. 

As stated above, the provision in 

existing § 100.6(c), which provides that 

a request for a conference is within 

MSHA’s discretion, would be moved to 

proposed § 100.6(a). Existing 100.6(d) 

would be renumbered as § 100.6(c) and 

otherwise remain unchanged. 

Existing §§ 100.6(e), (f), and (g) would 

be combined and incorporated into 

proposed § 100.6(d). The wording in 

paragraphs (e) and (g) would be 

unchanged. Paragraph (f) would be 

clarified to specify when the MSHA 

District managers are to refer citations 

and orders to MSHA’s Office of 

Assessments but would remain 

substantively unchanged. 

8. Notice of Proposed Penalty; Notice of 

Contest (§ 100.7) 

Existing § 100.7 provides for 

procedures applicable to a notice of 

proposed penalty and notice of penalty 

contest. Existing paragraph (a) sets out 

the circumstances under which a notice 

of proposed penalty will be served on 

the parties, paragraph (b) sets out the 

procedures for contesting a notice of 

proposed penalty, and paragraph (c) sets 

out when a proposed penalty becomes 

a final order of the Commission. 

Proposed § 100.7(a), (b), and (c) 

include editorial changes for ease of 

reading, but remain substantively 

unchanged from the existing provision. 

Proposed § 100.7(b) would remove from 

the regulatory text: (1) The reference to 

a return mailing card that is used to 

request a hearing before the Federal 

Mine Safety and Health Review 

Commission, (2) the reference to 

providing instructions for returning the 

card to MSHA, and (3) the provision 

that MSHA will immediately advise the 

Commission of the contest and also 

advise the Office of the Solicitor of the 

contest. MSHA is proposing these 

deletions because it is no longer using 

a return mailing card. Instead, MSHA 

currently provides a form that lists 

violations being assessed, instructions 

for paying or contesting assessments, 

and MSHA contact information to 

facilitate an operator’s request for a 

hearing. MSHA intends to continue this 

practice. MSHA would continue to 

advise the Office of the Solicitor and the 

Commission of the notice of penalty 

contest. 

9. Service (§ 100.8) 

Existing § 100.8 remains substantively 

unchanged. This section provides that 

service of proposed civil penalties will 

be made at the mailing address of record 

for an operator and miners’

representative, that penalty assessments 

may be mailed to a different address if 

MSHA is notified in writing of the new 

address, and that operators who fail to 

file a notification of legal identity under 

30 CFR Part 41 will be served at their 

last known business address. Specific 

references to part 40 (Representative of 

Miners) and part 41 (Notification of 

Legal Identity) would be changed to 

indicate they are parts contained in 

Chapter I of Title 30 CFR. 

IV. Executive Order 12866 

Executive Order (E.O.) 12866 as 

amended by E.O. 13258 (Amending 

Executive Order 12866 on Regulatory 

Planning and Review) requires that 

regulatory agencies assess both the costs 

and benefits of regulations. To comply 

with E.O. 12866, MSHA has prepared a 

Preliminary Regulatory Economic 

Analysis (PREA) for the proposed rule. 

The PREA contains supporting data and 

explanation for the summary materials 

presented in sections IV–VII of this 

preamble, including the covered mining 

industry, costs and benefits, feasibility, 

small business impacts, and paperwork. 

The PREA is located on MSHA’s Web 

site at http://www.msha.gov/ 

REGSINFO.HTM. A printed copy of the 

PREA can be obtained from MSHA’s 

Office of Standards, Regulations, and 

Variances. 

Based on the PREA, MSHA has 

determined that the proposed rule 

would not have an annual effect of $100 

million or more on the economy and 

that, therefore, it is not an economically 

‘‘significant regulatory action’’ pursuant 

to Section 3, paragraph (f) of E.O. 12866. 

A. Population at Risk 

Based on 2004 data, the proposed rule 

would apply to the entire mining 

industry, covering all 14,480 mine 

operators and 6,693 independent 

contractors in the United States, as well 

as the 214,450 miners and 72,739 

contract workers they employ. 

B. Costs 

In order to derive and explain the cost 

impact of the proposed rule on the 

mining industry, MSHA has divided its 

analysis into three sections: (1) The 

baseline—the total number and 

monetary amount of civil penalty 

assessments proposed by MSHA in 

2005, the year prior to the proposed 

rule; (2) the impact of the proposed rule 

on civil penalty assessments under the 

assumption that mine operators and 

independent contractors take no actions, 

in response to higher proposed penalty 

assessments, to increase compliance 

with MSHA standards and regulations; 

and (3) the impact of the proposed rule 

on the number and amount of civil 

penalty assessments taking into account 

the anticipated response of mine 

operators and independent contractors 

to increase compliance with MSHA 

standards and regulations and thereby 

reduce the number of civil penalty 

assessments they would otherwise 

receive. 

Before proceeding, it is important to 

note the nature of the impacts 

associated with the proposed rule. For 

most MSHA rules, the estimated impact 

reflects the cost to the mining industry 

of achieving compliance with the rule. 

For this proposed rule, the estimated 

impact consists of two parts: (1) Higher 

payments for penalties received and (2) 

expenses incurred to increase 

compliance with MSHA standards and 

regulations so as to reduce the number 

and amount of civil penalties otherwise 

received. Although the former impact is 

not a traditional compliance cost, but 

rather a cost specifically due to noncompliance, for the purposes of this 

analysis, MSHA has shown these costs. 

The latter costs are compliance costs, 

but for existing MSHA standards and 

regulations. These costs were included 

in economic assumptions made when 

those standards and regulations were 

promulgated. At that time, MSHA 

generally assumed full industry 

compliance. Therefore, compliance 

efforts made in response to higher 

penalties are not a cost attributable to 

the proposed rule. However, for 

illustrative purposes only, this analysis 


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reflects additional expenditures 

associated with improved compliance. 

1. Baseline 

The first step in estimating the impact 

of the proposed rule is to establish a 

baseline: The number and monetary 

amount of civil penalty assessments in 

the absence of the proposed rule. For 

this purpose, MSHA chose all civil 

penalty assessments for 2005, the last 

full calendar year of data prior to the 

proposed rule. Table IV–1 shows the 

number of civil penalty assessments 

issued in 2005, disaggregated by mine 

employment size, by coal and MNM, 

and by operators and independent 

contractors. 

TABLE IV–1.—BASELINE NUMBER OF CIVIL PENALTY ASSESSMENTS FOR 2005 

Contractor/mine employment size 

Coal-M/NM, operator/contractor 

Coal 

contractor Coal operator M/NM contractor 

M/NM 

operator All violations 

1–5 ................................................................................................. 2,856 2,741 1,609 12,528 19,734 

6–19 ............................................................................................... 757 9,063 1,048 16,125 26,993 

20–500 ........................................................................................... 1,479 43,428 1,183 17,685 63,775 

501+ ............................................................................................... 1 4,432 66 1,672 6,171 

All Mine Sizes ................................................................................ 5,093 59,664 3,906 48,010 116,673

The mine size and independent 

contractor size categories being used are 

1–5 employees, 6–19 employees, 20–500 

employees, and more than 500 

employees. These categories are relevant 

for the analysis of impacts in section VI 

of this preamble, to determine whether 

small mines, as defined by the Small 

Business Administration (SBA) and 

MSHA, would be significantly impacted 

by the proposed rule. Mines with 500 or 

fewer employees meet SBA’s definition 

of a small mine. Mines with fewer than 

20 employees meet MSHA’s traditional 

definition of a small mine. 

Mine violation data have been broken 

out by coal and metal/nonmetal (MNM) 

and by operator and independent 

contractor. The employment sizes 

shown are contractor size for 

independent contractors and mine size 

for mine operators. 

Of the 116,673 civil penalty 

assessments issued in 2005, 113,484, or 

about 97.3%, were single penalty or 

regular assessments. The remaining 

3,189, or 2.7%, were special 

assessments. 

As can be calculated from Table IV–

1, there were about 25% more coal 

violations than MNM violations in 2005, 

even though there were more than 31⁄2

times as many MNM operators and 

independent contractors as there were 

coal operators and independent 

contractors. One reason for the larger 

number of coal violations is that there 

are about 3 times as many underground 

coal mines as underground MNM 

mines. There are a number of 

circumstances surrounding 

underground mines which tend to result 

in a greater number of violations. They 

are required to be inspected more often, 

and conditions are generally more 

dangerous and subject to change. 

Another reason for more coal violations 

is that coal mines are, on average, larger 

operations than MNM mines, and larger 

mines tend to receive more violations, 

on average, than smaller mines. The 

average coal mine operator employed 

about 3 times as many miners as the 

average MNM operator in 2004. 

The 2005 civil penalty monetary 

amount used as a baseline was the 

penalty proposed by MSHA. Table IV– 

2 shows, by contractor/mine 

employment size and coal-MNM, 

operator-independent contractor, the 

total baseline dollar amount of civil 

penalties proposed by MSHA in 2005. 

TABLE IV–2.—BASELINE TOTAL OF PROPOSED CIVIL PENALTY ASSESSMENTS FOR 2005 

Contractor/mine employment size 

Coal-M/NM, operator/contractor 

Coal 

contractor Coal operator M/NM contractor 

M/NM 

operator All violations 

1–5 ................................................................................................. $308,649 $463,277 $200,947 $1,887,443 $2,860,316 

6–19 ............................................................................................... 86,319 1,492,545 109,837 2,535,563 4,224,264 

20–500 ........................................................................................... 314,195 11,010,009 192,151 3,890,799 15,407,154 

501+ ............................................................................................... 2,000 1,706,750 14,876 634,888 2,358,514 

All Mine Sizes ................................................................................ 711,163 14,672,581 517,811 8,948,693 24,850,248 

Of the $24.9 million in civil penalties 

proposed by MSHA in 2005, $16.6 

million, or about 67%, were from single 

penalty and regular assessments. The 

remaining $8.2 million were from 

special assessments. Of this amount, 

about $0.3 million were issued to agents 

of mine operators and another $1.5 

million were issued for violations 

involving a fatality. 

Table IV–3 displays the baseline 

average dollar amount of a proposed 

civil penalty in 2005 disaggregated by 

mine size and coal-MNM, operatorindependent contractor. The average 

penalty assessment for a violation in 

2005 was $213. For a regular or single 

penalty assessment, the average penalty 

was $147. For a special assessment, the 

average penalty was $2,385. For special 

assessments issued to agents of the mine 

operator, the average assessment was 

$582, and for special assessments 

involving a fatality, the average penalty 

was $27,181. 


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TABLE IV–3.—BASELINE AVERAGE PROPOSED CIVIL PENALTY ASSESSMENT PER VIOLATION IN 2005 

Contractor/mine employment size 

Coal-M/NM, operator contractor 

Coal 

contractor Coal operator M/NM contractor 

M/NM 

operator 

Average for 

all violations 

1–5 ................................................................................................. $108 $169 $125 $151 $145 

6–19 ............................................................................................... 114 165 105 157 156 

20–500 ........................................................................................... 212 254 162 220 242 

501+ ............................................................................................... 2,000 385 225 380 382 

All Mine Sizes ................................................................................ 140 246 133 186 213 

Consistent with the formulas used to 

calculate regular assessments under the 

existing regulations, Table IV–3 shows 

that the average proposed penalty 

assessment in 2005 tended to increase 

as mine size increased. This effect is 

consistent, particularly for mine 

operators with 20 or more employees. 

Table IV–3 also indicates that the 

difference in average penalties between 

coal and MNM mines and independent 

contractors of a given employment size 

is generally small. 

Table IV–2 reveals that total civil 

penalty assessments in 2005 were 

substantially larger, more than 50% 

larger, for coal mines than for MNM 

mines. The larger aggregate penalty 

assessment for coal mines is due to the 

larger number of violations issued to 

coal mines and the higher average 

penalty per violation. Coal violations 

tend to be more serious, on average, 

than MNM violations (e.g., 40% of coal 

violations are Significant and 

Substantial, or S&S, versus 23% for 

MNM violations). 

2. Impacts If No Compliance Response 

to Higher Penalties 

With the baseline established, the 

next task in the cost analysis is to 

determine the impact of the proposed 

rule on civil penalty assessments under 

the assumption that mine operators and 

independent contractors take no actions, 

in response to higher proposed penalty 

assessments, to increase compliance 

with MSHA standards and regulations. 

This task is an intermediate step in 

determining the total cost impact of the 

proposed rule, as MSHA’s assumption 

in IV.B.3 of this preamble is that mine 

operators and independent contractors 

will change their compliance behavior 

in response to increased penalties. 

Given the assumption of no 

compliance response by mine operators 

and independent contractors, the 

number of violations would not change 

in response to the proposed rule. They 

would remain the same as presented in 

Table IV–1 for the baseline. However, 

the type of the violations would change 

under the proposed rule. In the analysis, 

all 2005 regular and single penalty 

assessments would be issued as regular 

assessments under the proposed rule. 

MSHA assumed that most 

unwarrantable failure citations and 

orders would be processed as regular 

assessments under the minimum 

penalty requirements of the MINER Act. 

MSHA further assumed that the 2005 

special assessments issued to agents, 

those involving a fatality, those 

involving failure to promptly notify 

MSHA, and those involving flagrant 

violations would be assessed as special 

assessments under the proposed rule. 

MSHA assumed that all other 2005 

special assessments would be processed 

as regular assessments. Thus, under the 

proposed rule, MSHA estimates that the 

number of special assessments would 

decline by 85%, from 3,189 to 491. 

MSHA anticipates that, under the 

proposal, the regular assessment 

provision would generally provide an 

appropriate penalty in most cases. 

Equally significant, this will allow 

MSHA to focus its enforcement 

resources on more field enforcement 

activities, as opposed to administrative 

review activities. 

Tables IV–4 and IV–5 show the 

estimated total dollar amount and 

average dollar amount, respectively, of 

civil penalties under the proposed rule, 

assuming no compliance response by 

mine operators and independent 

contractors. Table IV–6 shows, relative 

to the baseline, the estimated percentage 

increase of civil penalties (both total 

and average) under the proposed rule, 

assuming no compliance response by 

mine operators and independent 

contractors. All of these tables are 

disaggregated by contractor/mine 

employment size, coal-MNM, and 

operator/contractor. 

TABLE IV–4.—TOTAL PROPOSED CIVIL PENALTY ASSESSMENTS UNDER PROPOSED RULE, ASSUMING NO COMPLIANCE

RESPONSE

Contractor/mine employment size 

Coal-M/NM, operator/contractor 

Coal 

contractor Coal operator M/NM contractor 

M/NM 

operator All violations 

1–5 ................................................................................................. $414,826 $684,448 $410,544 $3,207,759 $4,717,577 

6–19 ............................................................................................... 133,074 2,287,667 187,432 4,744,450 7,352,623 

20–500 ........................................................................................... 415,811 37,598,722 340,542 8,365,383 46,720,458 

501+ ............................................................................................... 807 7,394,118 43,973 2,288,395 9,727,293 

All Mine Sizes ................................................................................ 964,518 47,964,955 982,491 18,605,987 68,517,951 


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TABLE IV–5.—AVERAGE OF PROPOSED CIVIL PENALTY ASSESSMENTS UNDER PROPOSED RULE, ASSUMING NO

COMPLIANCE RESPONSE

Contractor/mine employment size 

Coal-M/NM, operator/contractor 

Coal 

contractor Coal operator M/NM contractor 

M/NM 

operator 

Average for 

all violations 

1–5 ................................................................................................. $145 $250 $255 $256 $239 

6–19 ............................................................................................... 176 252 179 294 272 

20–500 ........................................................................................... 281 866 288 473 733 

501+ ............................................................................................... 807 1,668 666 1,369 1,576 

All Mine Sizes ................................................................................ 189 804 252 388 587 

TABLE IV–6.—PERCENTAGE INCREASE IN TOTAL AND AVERAGE PROPOSED CIVIL PENALTY ASSESSMENTS UNDER

PROPOSED RULE, ASSUMING NO COMPLIANCE RESPONSE

Contractor/mine employment size 

Coal-M/NM, operator/contractor 

Coal 

contractor Coal operator M/NM contractor 

M/NM 

operator 

Average percentage increase for all 

violations 

1–5 ................................................................................................. 34 48 104 70 65 

6–19 ............................................................................................... 54 53 71 87 74 

20–500 ........................................................................................... 32 241 77 115 203 

501+ ............................................................................................... ¥60 333 196 260 312 

All Mine Sizes ................................................................................ 36 227 90 108 176 

As indicated in these tables, MSHA 

estimates that total civil penalty 

assessments would increase under the 

proposed rule, assuming no compliance 

response, from $24.9 million in the 

baseline to $68.5 million, an increase of 

$43.7 million, or 176%. Approximately 

$2.5 million, or about 4% of the $68.5 

million, would come from special 

assessments. Of the $43.7 million 

increase, approximately $1.9 million 

would result from the minimum penalty 

provisions for unwarrantable violations 

in the MINER Act. In its analysis of 

2005 data, MSHA found one violation 

which met the failure to provide timely 

notification provisions in the MINER 

Act. For this category of violations, the 

MINER Act imposes a penalty of $5,000 

to $60,000. However, the particular 

violation had already received a special 

assessment in excess of $5,000. Thus, 

MSHA did not adjust penalty totals to 

account for this provision of the MINER 

Act. 

MSHA has determined that flagrant 

violations will be processed under the 

special assessment provision. As stated 

in the proposal, MSHA will use the 

definition for flagrant violation in the 

MINER Act, but the Agency cannot 

estimate, at this point in the rulemaking 

process, the specific impact of this new 

requirement in the MINER Act. The 

Agency does, however, anticipate that 

penalties will increase due to this 

provision. 

MSHA estimates that the average 

penalty assessment would increase 

under the proposed rule, assuming no 

compliance response, from $213 (shown 

in Table IV–3) to $587 (shown in Table 

IV–5), an increase of 176% (shown in 

Table IV–6). Consistent with 

Congressional intent, the average 

penalty generally increases as mine size 

or contractor size increases (shown in 

Table IV–5). 

For purposes of the analysis, special 

assessments that remain as special 

assessments were assumed to receive 

the same penalty, unless they would be 

impacted by the minimum penalty 

provisions of the MINER Act. All 

special assessments in 2005 involving a 

fatality exceeded the new minimum 

penalty provisions, so these penalties 

are assumed unchanged by the proposed 

rule. However, the average penalty for 

special assessments issued to agents of 

the mine operator is estimated to 

increase by 367% under the proposed 

rule. This increase is entirely due to the 

application of the minimum penalty 

provisions for unwarrantable violations 

in the MINER Act. 

For purposes of analysis, the 

remaining special assessments are 

assumed to be treated as regular 

assessments under the proposal. In the 

analysis, the average penalty for 2005 

special assessments, assumed to be 

issued as regular assessments under the 

proposed rule, increased by 84%. 

3. Impacts With Compliance Response 

to Higher Penalties 

MSHA intends and expects that 

higher penalty assessments will lead to 

efforts by mine operators and 

independent contractors to increase 

compliance with MSHA standards and 

regulations and ultimately to decreased 

violations. MSHA assumes that each 

violation is associated with a probability 

of occurrence that declines as penalty 

assessments rise. To estimate this 

impact, MSHA assumes that each 10% 

increase in penalty for a violation is 

associated with a 3% decrease in its 

probability of occurrence. 

In economic terms, this is equivalent 

to assuming an elasticity of ¥0.3 

between the number of violations and 

the dollar size of penalties. The 

numbers derived from this elasticity 

assumption are for illustrative purposes 

only. A lower elasticity number (e.g., 

¥0.1) would yield less impact and a 

higher number (e.g., ¥0.9) would yield 

more impact. This elasticity of ¥0.3 

was previously assumed by MSHA in its 

regulatory economic analysis for the 

2003 direct final rule to adjust civil 

penalties for inflation. Further 

explanation and mathematics are 

provided in the PREA for this proposed 

rule. 

MSHA has consistently applied this 

assumption to each assessed violation in 

the 2005 database. For most violations, 

the proposed rule would result in a 

penalty increase. Accordingly, MSHA 

has computed a reduction (or in the rare 


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case, an increase) in the probability of 

the violation’s occurrence. The 

reduction is larger as the penalty 

increases. 

Tables IV–7 and IV–8 estimate the 

increased compliance response of the 

industry to higher penalty assessments. 

Table IV–7 provides estimates for mine 

operators and Table IV–8 provides 

estimates for independent contractors. 

Tables IV–7 and IV–8 show, by mine or 

contractor employment size and by coal 

and MNM, the number of violations and 

the dollar amount of penalties in the 

2005 database (‘‘Old’’). Using the 

assumption that the elasticity of 

response is ¥0.3 for each violation, 

Tables IV–7 and IV–8 estimate the new 

reduced number of violations and the 

higher penalties associated with these 

violations (‘‘New’’). Taking into account 

the mine industry’s compliance 

response, MSHA estimates that were the 

proposed rule in effect in 2005, total 

violations would have declined from 

116,673 to 95,035, a reduction of about 

19% in the total number of violations. 

TABLE IV–7.—IMPACT OF PROPOSED RULE ON MINE OPERATORS GIVEN INCREASED COMPLIANCE RESPONSE TO HIGHER

PENALTY ASSESSMENTS

Mine employment size Old number 

of violations 

Old proposed 

penalties 

New number 

of violations 

New proposed penalties 

Change in 

penalties 

Additional 

expenditures 

to improve 

compliance* 

Impact on Coal Mine Operators 

1–5 ................................................................... 2,741 $463,277 2,476 $566,992 $103,715 $44,449 

6–19 ................................................................. 9,063 1,492,545 8,145 1,895,806 403,261 172,826 

20–500 ............................................................. 43,428 11,010,009 33,616 23,661,984 12,651,975 5,422,275 

501+ ................................................................. 4,432 1,706,750 2,941 4,356,873 2,650,123 1,135,767 

All Mine Sizes ........................................... 59,664 14,672,581 47,178 30,481,655 15,809,074 6,775,317 

Impact on Metal/Nonmetal Mine Operators 

1–5 ................................................................... 12,528 $1,887,443 10,955 $2,562,832 675,389 $289,453 

6–19 ................................................................. 16,125 2,535,563 13,846 3,632,672 1,097,109 470,190 

20–500 ............................................................. 17,685 3,890,799 13,986 6,110,644 2,219,845 951,362 

501+ ................................................................. 1,672 634,888 1,101 1,381,516 746,628 319,983 

All Mine Sizes ........................................... 48,010 8,948,693 39,889 13,687,664 4,738,971 2,030,988 

* These additional expenditures are shown for illustrative purposes only and are not included in the costs of this proposal, since they were included in analyses of costs when standards were promulgated. 

TABLE IV–8.—IMPACT OF PROPOSED RULE ON INDEPENDENT CONTRACTORS GIVEN INCREASED COMPLIANCE RESPONSE

TO HIGHER PENALTY ASSESSMENTS

Contractor employment size Old number 

of violations 

Old proposed 

penalties 

New number 

of violations 

New 

proposed 

penalties 

Change in 

penalties 

Additional 

expenditures 

to improve 

compliance* 

Impact on Coal Independent Contractors 

1–5 ................................................................... 2,856 $308,649 2,607 $361,058 $52,409 $22,461 

6–19 ................................................................. 757 86,319 678 113,178 26,859 11,511 

20–500 ............................................................. 1,479 314,195 1,349 355,952 41,757 17,896 

501+ ................................................................. 1 2,000 1 1,060 ¥940 ¥403 

All Contractor Sizes .................................. 5,093 711,163 4,636 831,247 120,084 51,465 

Impact on Metal/Nonmetal Independent Contractors 

1–5 ................................................................... 1,609 $200,947 1,377 $318,731 $117,784 $50,479 

6–19 ................................................................. 1,048 109,837 905 150,508 40,671 17,430 

20–500 ............................................................. 1,183 192,151 998 267,210 75,059 32,168 

501+ ................................................................. 66 14,876 52 30,615 15,739 6,745 

All Contractor Sizes .................................. 3,906 517,811 3,332 767,064 249,253 106,823 

* These additional expenditures are shown for illustrative purposes only and are not included in the costs of this proposal, since they were included in analyses of costs when standards were promulgated. 

The ‘‘Change in Penalties’’ column 

represents the increase in penalties, 

relative to the baseline, for remaining 

violations. The total change in proposed 

penalty assessments is approximately 

$15.8 million for coal mine operators, 

$0.1 million for coal independent 

contractors, $4.7 million for MNM mine 

operators, and $0.2 million for MNM 

independent contractors. The sum of 

these four numbers, $20.9 million, is the 

total cost of the proposed rule. 

To reduce the number of violations in 

response to the higher penalty 

assessments, MSHA assumes that mines 

will increase costs to improve 

compliance. The column, ‘‘Additional 

Expenditures to Improve Compliance,’’


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1As shown earlier, in response to increased 

penalty assessments, MSHA expects that coal mine 

operators and contractors will spend an additional 

$6.8 million and MNM operators and contractors an 

additional $2.1 million to increase compliance with 

MSHA standards and regulations so as to reduce the 

number and amount of civil penalty assessments 

otherwise received. But the costs to achieve 

compliance with these standards and regulations 

have already been estimated and recognized, under 

full compliance assumptions, when the standards 

and regulations were promulgated. Therefore, the 

costs associated with improved compliance are not 

properly attributable to the proposed rule. To 

include them as a cost of the proposed rule would 

be to double-count them. 

represents MSHA’s estimate of these 

increased compliance costs. These 

estimates are based on the same 

assumption that the elasticity of 

response is ¥0.3 and the additional 

assumption that the increased 

compliance activities will be 

undertaken by the mining industry to 

avoid increased penalties. These 

increased compliance costs to avoid 

higher penalties are not counted as a 

cost of this proposed rule, because full 

compliance with MSHA standards is 

assumed when standards are 

promulgated. 

Table IV–9 summarizes the impacts 

by mining sector. 

TABLE IV–9.—IMPACT OF PROPOSED RULE, BOTH WITH UNCHANGED COMPLIANCE AND WITH INCREASED COMPLIANCE

RESPONSE TO HIGHER PENALTY ASSESSMENTS

Mining sector Old proposed 

penalties 

New proposed 

penalties, same 

compliance 

Change in penalties, same 

compliance 

Percent change 

in penalties, 

same compliance 

Same Number of Violations 

Coal .......................................................................................................... $15,383,744 $48,929,473 $33,545,729 218 

Metal ........................................................................................................ 1,396,682 4,054,371 2,657,689 190 

Nonmetal .................................................................................................. 594,888 1,171,774 576,886 97 

Sand and Gravel ...................................................................................... 3,113,522 5,544,307 2,430,785 78 

Stone ........................................................................................................ 4,361,412 8,818,026 4,456,614 102 

Total .................................................................................................. 24,850,248 68,517,951 43,667,703 176 

Mining sector 

Additional 

expenditures to 

improve 

compliance* 

New proposed 

penalties, 

improved 

compliance 

Change in 

penalties, improved compliance 

Percent change 

in penalties, improved compliance 

Reduced Number of Violations 

Coal .......................................................................................................... $6,826,782 $31,312,902 $15,929,158 104 

Metal ........................................................................................................ 524,403 2,620,288 1,223,606 88 

Nonmetal .................................................................................................. 132,222 903,406 308,518 52 

Sand and Gravel ...................................................................................... 522,167 4,331,911 1,218,389 39 

Stone ........................................................................................................ 959,019 6,599,123 2,237,711 51 

Total .................................................................................................. 8,964,592 45,767,630 20,917,382 84 

* These additional expenditures are shown for illustrative purposes only and are not included in the costs of this proposal, since they were included in analyses of costs when standards were promulgated. 

C. Benefits 

The benefits of the proposed rule are 

the reduced number of injuries and 

fatalities that would result from 

increased compliance with MSHA’s 

health and safety standards and 

regulations in response to higher 

penalty assessments. MSHA projects 

that higher penalties will induce mine 

operators to reduce all safety and health 

violations. The reduction in the number 

of violations, particularly S&S 

violations, or those reasonably likely to 

result in reasonably serious injury or 

illness, will reduce the number and 

severity of injuries and illnesses. 

V. Feasibility 

MSHA has concluded that the 

requirements of the proposed rule are 

technologically and economically 

feasible. 

A. Technological Feasibility 

The proposed rule is a regulation, not 

a standard. It does not involve activities 

on the frontiers of scientific knowledge. 

The mining industry has been 

complying with the adjudication and 

payment of civil penalties for decades. 

MSHA concludes, therefore, that the 

proposed rule is technologically 

feasible. 

B. Economic Feasibility 

MSHA estimates that the yearly 

increased penalty assessments issued to 

coal mines as a result of the proposed 

rule will be $15.9 million dollars, which 

is equal to about 0.07 percent of coal 

mine sector revenues of $22.1 billion in 

2004. MSHA estimates that the yearly 

increased penalty assessments issued to 

MNM mines as a result of the proposed 

rule will be $5.0 million dollars, which 

is equal to about 0.01 percent of MNM 

mine sector revenues of $44.0 billion in 

2004. Since the total estimated 

increased penalty assessments for both 

the coal and MNM mine sectors are well 

below one percent of their estimated 

revenues, MSHA concludes that the 

proposed rule is economically feasible 

for the mining industry.1

VI. Regulatory Flexibility Act and 

Small Business Regulatory Enforcement 

Fairness Act (SBREFA) 

Pursuant to the Regulatory Flexibility 

Act (RFA) of 1980, as amended by the 

Small Business Regulatory Enforcement 

Fairness Act (SBREFA), MSHA has 

analyzed the impact of the proposed 

rule on small entities. Based on that 

analysis, MSHA has made a 

determination with respect to whether 


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53070 Federal Register / Vol. 71, No. 174 / Friday, September 8, 2006 / Proposed Rules 

2U.S. Department of the Interior, U.S. Geological 

Survey, Mineral Commodity Summaries 2005, 

January 2005, p. 8. 

the agency can certify that the proposed 

rule would not have a significant 

economic impact on a substantial 

number of small entities. Unless able to 

certify that the proposed rule would not 

have a significant economic impact on 

a substantial number of small entities, 

MSHA must develop an initial 

regulatory flexibility analysis. 

MSHA certifies that the proposed rule 

would not have a significant economic 

impact on a substantial number of small 

entities that are covered by this 

rulemaking. The factual basis for this 

certification is presented in full in 

Chapter V of the PREA and in summary 

form below. 

A. Definition of a Small Mine 

Under the RFA, in analyzing the 

impact of a rule on small entities, 

MSHA must use the SBA definition for 

a small entity or, after consultation with 

the SBA Office of Advocacy, establish 

an alternative definition for the mining 

industry by publishing that definition in 

the Federal Register for notice and 

comment. MSHA has not taken such an 

action and hence is required to use the 

SBA definition. The SBA defines a 

small entity in the mining industry as 

an establishment with 500 or fewer 

employees. 

MSHA has also examined the impacts 

of agency rules on a subset of mines 

with 500 or fewer employees—those 

with fewer than 20 employees, which 

MSHA and the mining community have 

traditionally referred to as ‘‘small 

mines.’’ These small mines differ from 

larger mines not only in the number of 

employees, but also in economies of 

scale in material produced, in the type 

and amount of production equipment, 

and in supply inventory. Therefore, 

their costs of complying with MSHA’s 

rules and the impact of the agency’s 

rules on them will also tend to be 

different. It is for this reason that ‘‘small 

mines,’’ as traditionally defined by 

MSHA as those employing fewer than 

20 workers, are of special concern to 

MSHA. In addition, for this proposed 

rule, MSHA has examined the cost on 

mines with five or fewer employees to 

ensure that this subset of mines is not 

significantly and adversely impacted by 

the proposed rule. 

This analysis complies with the 

requirements of the RFA for an analysis 

of the impacts on ‘‘small entities’’ while 

continuing MSHA’s traditional 

definition of ‘‘small mines.’’ Both the 

proposal and this analysis reflect 

MSHA’s concern for mines with 5 or 

fewer employees. MSHA concludes that 

it can certify that the proposed rule 

would not have a significant economic 

impact on a substantial number of small 

entities that are covered by this 

rulemaking. MSHA has determined that 

this is the case for mines with fewer 

than 20 employees and mines with 500 

or fewer employees. In its detailed 

factual basis below, MSHA will also 

show effects of the proposal on mines 

with 5 or fewer employees. 

B. Factual Basis for Certification 

MSHA’s analysis of impacts on ‘‘small 

entities’’ begins with a ‘‘screening’’

analysis. The screening compares the 

estimated costs of a rule for small 

entities in the sector affected by the rule 

to the estimated revenues for the 

affected sector. When estimated costs 

are less than one percent of the 

estimated revenues, MSHA believes it is 

generally appropriate to conclude that 

there is no significant economic impact 

on a substantial number of small 

entities. When estimated costs are equal 

to or exceed one percent of revenues, it 

tends to indicate that further analysis 

may be warranted. 

Normally, the analysis of the costs or 

economic impact of a rule assumes that 

mine operators are in 100% compliance 

with a rule. Under the assumption that 

mine operators are in 100% compliance 

with all of MSHA’s rules, there would 

be no cost of compliance with the 

proposed rule, since no mine operator 

would be exposed to civil penalties. For 

purposes of analyzing the effects on 

small mines, MSHA reverses this usual 

assumption and instead analyzes the 

increased penalty assessments for mines 

not in compliance with the agency’s 

other rules. 

For coal mines, estimated 2004 

production was 4.6 million tons for 

mines with 1–5 employees, 28.7 million 

tons for mines with 1–19 employees, 

and 896.8 million tons for mines with 

1–500 employees. Using the 2004 price 

of coal of $19.93 per ton, the 2004 coal 

revenues are estimated to be 

approximately $91 million for mines 

with 1–5 employees, $572 million for 

mines with 1–19 employees, and 

$17,872 million for mines with 1–500 

employees. Dividing the increase in 

penalties by the revenues in each mine 

size category, the cost of the rule for 

coal mines is 0.17% of revenues for 

mines with 1–5 employees, 0.10% of 

revenues for mines with 1–19 

employees, and 0.07% of revenues for 

mines with 1–500 employees. Further 

details are shown in Table VI–1. 

For MNM mines, the total 2004 

revenue generated by the MNM industry 

($44.0 billion) 2 was divided by the total 

number of employee hours to arrive at 

the average revenue per hour of 

employee production ($145.90). The 

$145.90 was multiplied by employee 

hours in specific mine size categories to 

arrive at estimated revenues for these 

categories. This approach was used to 

determine the estimated revenues for 

the MNM mining industry because 

MSHA does not collect data on MNM 

production. The 2004 MNM revenues 

are estimated to be approximately $3.9 

billion for mines with 1–5 employees, 

$15.4 billion for mines with 1–19 

employees, and $40.6 billion for mines 

with 1–500 employees. Dividing the 

increase in penalties by the revenues in 

each mine size category, the cost of the 

rule for MNM mines is 0.02% of 

revenues for mines with 1–5 employees, 

0.01% of revenues for mines with 1–19 

employees, and 0.01% of revenues for 

mines with 1–500 employees. Further 

details are shown in Table VI–1. 

TABLE VI–1.—INCREASE IN PENALTIES DUE TO PROPOSED RULE COMPARED TO MINE REVENUES, BY MINE SIZE

Employment size Number of 

mines 

Increase in 

penalties 

Estimated 

revenue 

(millions) 

Increase in 

penalties per 

mine 

Penalty 

increase as 

% of revenue 

Coal Mines 

1–5 employees ................................................................... 560 $156,124 $91 $279 0.17 

1–19 employees ................................................................. 1,149 586,243 572 510 0.10 

1–500 employees ............................................................... 2,000 13,279,975 17,872 6,640 0.07 


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TABLE VI–1.—INCREASE IN PENALTIES DUE TO PROPOSED RULE COMPARED TO MINE REVENUES, BY MINE SIZE—

Continued 

Employment size Number of 

mines 

Increase in 

penalties 

Estimated 

revenue 

(millions) 

Increase in 

penalties per 

mine 

Penalty 

increase as 

% of revenue 

All mines ............................................................................ 2,011 15,929,158 22,144 7,921 0.07 

M/NM Mines 

1–5 employees ................................................................... 6,370 793,173 3,903 125 0.02 

1–19 employees ................................................................. 10,771 1,930,953 15,379 179 0.01 

1–500 employees ............................................................... 12,447 4,225,857 40,628 340 0.01 

All mines ............................................................................ 12,467 4,988,224 44,000 400 0.01 

As shown in Table VI–1, when 

applying MSHA’s and SBA’s definitions 

of small mines, yearly costs of the 

proposed rule are substantially less than 

1 percent of estimated yearly revenues, 

well below the level suggesting that the 

rule might have a significant economic 

impact on a substantial number of small 

entities. Accordingly, MSHA has 

certified that the proposed rule would 

not have a significant economic impact 

on a substantial number of small entities 

that are covered by the rule. 

VII. Paperwork Reduction Act of 1995 

The proposed rule contains no 

information collections subject to 

review by the Office of Management and 

Budget (OMB) under the Paperwork 

Reduction Act. 

VIII. Other Regulatory Considerations 

A. The Unfunded Mandates Reform Act 

of 1995 

The proposed rule does not include 

any Federal mandate that may result in 

increased expenditures by State, local, 

or tribal governments; nor does it 

increase private sector expenditures by 

more than $100 million annually; nor 

does it significantly or uniquely affect 

small governments. Accordingly, the 

Unfunded Mandates Reform Act of 1995 

(2 U.S.C. 1501 et seq.) requires no 

further agency action or analysis. 

B. Treasury and General Government 

Appropriations Act of 1999: Assessment 

of Federal Regulations and Policies on 

Families 

The proposed rule would have no 

effect on family well-being or stability, 

marital commitment, parental rights or 

authority, or income or poverty of 

families and children. Accordingly, 

Section 654 of the Treasury and General 

Government Appropriations Act of 1999 

(5 U.S.C. 601 note) requires no further 

agency action, analysis, or assessment. 

C. Executive Order 12630: Government 

Actions and Interference With 

Constitutionally Protected Property 

Rights 

The proposed rule would not 

implement a policy with takings 

implications. Accordingly, Executive 

Order 12630, Governmental Actions and 

Interference with Constitutionally 

Protected Property Rights, requires no 

further agency action or analysis. 

D. Executive Order 12988: Civil Justice 

Reform 

The proposed rule was drafted and 

reviewed in accordance with Executive 

Order 12988, Civil Justice Reform. The 

proposed rule was written to provide a 

clear legal standard for affected conduct 

and was carefully reviewed to eliminate 

drafting errors and ambiguities, so as to 

minimize litigation and undue burden 

on the Federal court system. MSHA has 

determined that the proposed rule 

would meet the applicable standards 

provided in Section 3 of Executive 

Order 12988. 

E. Executive Order 13045: Protection of 

Children From Environmental Health 

Risks and Safety Risks 

The proposed rule would have no 

adverse impact on children. 

Accordingly, Executive Order 13045, 

Protection of Children from 

Environmental Health Risks and Safety 

Risks, as amended by Executive Orders 

13229 and 13296, requires no further 

agency action or analysis. 

F. Executive Order 13132: Federalism 

The proposed rule does not have 

‘‘federalism implications’’ because it 

does not ‘‘have substantial direct effects 

on the States, on the relationship 

between the national government and 

the States, or on the distribution of 

power and responsibilities among the 

various levels of government.’’

Accordingly, Executive Order 13132, 

Federalism, requires no further agency 

action or analysis. 

G. Executive Order 13175: Consultation 

and Coordination With Indian Tribal 

Governments 

The proposed rule does not have 

‘‘tribal implications’’ because it does not 

‘‘have substantial direct effects on one 

or more Indian tribes, on the 

relationship between the Federal 

government and Indian tribes, or on the 

distribution of power and 

responsibilities between the Federal 

government and Indian tribes.’’

Accordingly, Executive Order 13175, 

Consultation and Coordination with 

Indian Tribal Governments, requires no 

further agency action or analysis. 

H. Executive Order 13211: Actions 

Concerning Regulations That 

Significantly Affect Energy Supply, 

Distribution, or Use 

The proposed rule has been reviewed 

for its impact on the supply, 

distribution, and use of energy because 

it applies to the coal mining industry. 

Insofar as the proposed rule will result 

in added yearly civil penalty 

assessments of approximately $15.9 

million to the coal mining industry, 

relative to annual revenues of $22.1 

billion in 2004, it is not a ‘‘significant 

energy action’’ because it is not ‘‘likely 

to have a significant adverse effect on 

the supply, distribution, or use of 

energy * * * (including a shortfall in 

supply, price increases, and increased 

use of foreign supplies).’’ Accordingly, 

E.O. 13211, Actions Concerning 

Regulations That Significantly Affect 

Energy Supply, Distribution, or Use, 

requires no further Agency action or 

analysis. 

I. Executive Order 13272: Proper 

Consideration of Small Entities in 

Agency Rulemaking 

MSHA has thoroughly reviewed the 

proposed rule to assess and take 

appropriate account of its potential 

impact on small businesses, small 

governmental jurisdictions, and small 

organizations. MSHA has determined 


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53072 Federal Register / Vol. 71, No. 174 / Friday, September 8, 2006 / Proposed Rules 

and certified that the proposed rule 

would not have a significant economic 

impact on a substantial number of small 

entities. 

List of Subjects in 30 CFR Part 100 

Mine safety and health, Penalties. 

Dated: September 5, 2006. 

David G. Dye, 

Acting Assistant Secretary for Mine Safety 

and Health. 

For the reasons set forth in the 

preamble, MSHA proposes to revise 30 

CFR part 100 to read as follows: 

PART 100—CRITERIA AND 

PROCEDURES FOR PROPOSED 

ASSESSMENT OF CIVIL PENALTIES 

Sec. 

100.1 Scope and purpose. 

100.2 Applicability. 

100.3 Determination of penalty amount; 

regular assessment. 

100.4 Unwarrantable failure. 

100.5 Determination of penalty; special 

assessment. 

100.6 Procedures for review of citations and 

orders; procedures for assessment of civil 

penalties and conferences. 

100.7 Notice of proposed penalty; notice of 

contest. 

100.8 Service. 

Authority: 30 U.S.C. 815, 820, and 957; 

Pub. L. 109–236, 120 Stat. 493. 

§ 100.1 Scope and purpose. 

This part provides the criteria and 

procedures for proposing civil penalties 

under sections 105 and 110 of the 

Federal Mine Safety and Health Act of 

1977 (Mine Act). The purpose of this 

part is to provide a fair and equitable 

procedure for the application of the 

statutory criteria in determining 

proposed penalties for violations, to 

maximize the incentives for mine 

operators to prevent and correct 

hazardous conditions, and to assure the 

prompt and efficient processing and 

collection of penalties. 

§ 100.2 Applicability. 

The criteria and procedures in this 

part are applicable to all proposed 

assessments of civil penalties for 

violations of the Mine Act and the 

standards and regulations promulgated 

pursuant to the Mine Act, as amended. 

MSHA shall review each citation and 

order and shall make proposed 

assessments of civil penalties. 

§ 100.3 Determination of penalty amount; 

regular assessment. 

(a) General. (1) The operator of any 

mine in which a violation occurs of a 

mandatory health or safety standard or 

who violates any other provision of the 

Mine Act, shall be assessed a civil 

penalty of not more than $60,000. Each 

occurrence of a violation of a mandatory 

safety or health standard may constitute 

a separate offense. The amount of the 

proposed civil penalty shall be based on 

the criteria set forth in sections 105(b) 

and 110(i) of the Mine Act. These 

criteria are: 

(i) The appropriateness of the penalty 

to the size of the business of the 

operator charged; 

(ii) The operator’s history of previous 

violations; 

(iii) Whether the operator was 

negligent; 

(iv) The gravity of the violation; 

(v) The demonstrated good faith of the 

operator charged in attempting to 

achieve rapid compliance after 

notification of a violation; and 

(vi) The effect of the penalty on the 

operator’s ability to continue in 

business. 

(2) A regular assessment is 

determined by first assigning the 

appropriate number of penalty points to 

the violation by using the appropriate 

criteria and tables set forth in this 

section. The total number of penalty 

points will then be converted into a 

dollar amount under the penalty 

conversion table in paragraph (g) of this 

section. The penalty amount will be 

adjusted for demonstrated good faith in 

accordance with paragraph (f) of this 

section. 

(b) The appropriateness of the penalty 

to the size of the business of the 

operator charged. The appropriateness 

of the penalty to the size of the 

production operator’s business is 

calculated by using both the size of the 

mine cited and the size of the 

controlling entity of the mine. The size 

of coal mines and their controlling 

entities is measured by coal production. 

The size of metal and nonmetal mines 

and their controlling entities is 

measured by hours worked. The size of 

independent contractors is measured by 

the total hours worked at all mines. 

Penalty points for size are assigned 

based on Tables I to V of this section. 

As used in these tables, the terms 

‘‘annual tonnage’’ and ‘‘annual hours 

worked’’ mean coal produced and hours 

worked in the previous calendar year. In 

cases where a full year of data is not 

available, the coal produced or hours 

worked is prorated to an annual basis. 

This criterion accounts for a maximum 

of 25 penalty points. 

TABLE I.—SIZE OF COAL MINE

Annual tonnage of mine Penalty 

points 

0 to 15,000 ................................... 0 

Over 15,000 to 30,000 ................. 2 

TABLE I.—SIZE OF COAL MINE—

Continued 

Annual tonnage of mine Penalty 

points 

Over 30,000 to 50,000 ................. 4 

Over 50,000 to 100,000 ............... 6 

Over 100,000 to 200,000 ............. 8 

Over 200,000 to 300,000 ............. 10 

Over 300,000 to 500,000 ............. 12 

Over 500,000 to 800,000 ............. 14 

Over 800,000 to 1.1 million .......... 16 

Over 1.1 million to 2 million .......... 18 

Over 2 million ............................... 20 

TABLE II.—SIZE OF CONTROLLING

ENTITY—COAL MINE

Annual tonnage Penalty 

points 

0 to 100,000 ................................. 0 

Over 100,000 to 700,000 ............. 1 

Over 700,000 to 1.5 million .......... 2 

Over 1.5 million to 5 million .......... 3 

Over 5 million to 10 million ........... 4 

Over 10 million ............................. 5 

TABLE III.—SIZE OF METAL/NONMETAL

MINE

Annual hours worked at mine Penalty 

points 

0 to 10,000 ................................... 0 

Over 10,000 to 20,000 ................. 2 

Over 20,000 to 30,000 ................. 4 

Over 30,000 to 60,000 ................. 6 

Over 60,000 to 100,000 ............... 8 

Over 100,000 to 200,000 ............. 10 

Over 200,000 to 300,000 ............. 12 

Over 300,000 to 500,000 ............. 14 

Over 500,000 to 700,000 ............. 16 

Over 700,000 to 1 million ............. 18 

Over 1 million ............................... 20 

TABLE IV.—SIZE OF CONTROLLING

ENTITY—METAL/NONMETAL MINE

Annual hours worked Penalty 

points 

0 to 60,000 ................................... 0 

Over 60,000 to 400,000 ............... 1 

Over 400,000 to 900,000 ............. 2 

Over 900,000 to 3 million ............. 3 

Over 3 million to 6 million ............. 4 

Over 6 million ............................... 5 

TABLE V.—SIZE OF INDEPENDENT

CONTRACTOR

Annual hours worked at all mines Penalty 

points 

0 to 10,000 ................................... 0 

Over 10,000 to 20,000 ................. 2 

Over 20,000 to 30,000 ................. 4 

Over 30,000 to 60,000 ................. 6 

Over 60,000 to 100,000 ............... 8 

Over 100,000 to 200,000 ............. 10 


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TABLE V.—SIZE OF INDEPENDENT

CONTRACTOR—Continued 

Annual hours worked at all mines Penalty 

points 

Over 200,000 to 300,000 ............. 12 

Over 300,000 to 500,000 ............. 14 

Over 500,000 to 700,000 ............. 16 

Over 700,000 to 1 million ............. 18 

Over 1 million ............................... 20 

(c) History of previous violations. An 

operator’s history of previous violations 

is based on both the total number of 

violations and the number of repeat 

violations of the same standard in a 

preceding 15-month period. Only 

assessed violations that have been paid 

or finally adjudicated, or have become 

final orders of the Commission will be 

included in determining an operator’s 

history. 

(1) Total number of violations. For 

production operators, penalty points are 

calculated on the basis of the number of 

violations per inspection day 

(VPID)(Table VI of this section). Penalty 

points are not calculated for mines with 

fewer than ten violations in the 

specified history period. For 

independent contractors, penalty points 

are calculated on the basis of the total 

number of violations at all mines (Table 

VII of this section). This aspect of the 

history criterion accounts for a 

maximum of 25 penalty points. 

TABLE VI.—MINE OPERATORS

Violations per inspection day Penalty 

points 

0 to 0.3 ......................................... 0 

Over 0.3 to 0.5 ............................. 2 

Over 0.5 to 0 7 ............................. 4 

Over 0.7 to 0.9 ............................. 6 

Over 0.9 to 1.1 ............................. 8 

Over 1.1 to 1.3 ............................. 10 

Over 1.3 to 1.5 ............................. 13 

Over 1.5 to 1.7 ............................. 16 

Over 1.7 to 1.9 ............................. 19 

Over 1.9 to 2.1 ............................. 22 

Over 2.1 ........................................ 25 

TABLE VII.—INDEPENDENT

CONTRACTORS

Number of violations Penalty 

points 

0 to 5 ............................................ 0 

Over 5 to 10 ................................. 2 

Over 10 to 15 ............................... 4 

Over 15 to 20 ............................... 6 

Over 20 to 25 ............................... 8 

Over 25 to 30 ............................... 10 

Over 30 to 35 ............................... 13 

Over 35 to 40 ............................... 16 

Over 40 to 45 ............................... 19 

Over 45 to 50 ............................... 22 

TABLE VII.—INDEPENDENT

CONTRACTORS—Continued 

Number of violations Penalty 

points 

Over 50 ......................................... 25 

(2) Repeat violations of the same 

standard. Repeat violation history is 

based on the number of violations of the 

same standard. This aspect of the 

history criterion accounts for a 

maximum of 20 penalty points (Table 

VIII of this section). 

TABLE VIII.—REPEAT VIOLATIONS OF

THE SAME STANDARD

Number of violations Penalty 

points 

5 or fewer ..................................... 0 

6 .................................................... 1 

7 .................................................... 2 

8 .................................................... 3 

9 .................................................... 4 

10 .................................................. 5 

11 .................................................. 6 

12 .................................................. 7 

13 .................................................. 8 

14 .................................................. 9 

15 .................................................. 10 

16 .................................................. 11 

17 .................................................. 12 

18 .................................................. 14 

19 .................................................. 16 

20 .................................................. 18 

More than 20 ................................ 20 

(d) Negligence. Negligence is conduct, 

either by commission or omission, 

which falls below a standard of care 

established under the Mine Act to 

protect miners against the risks of harm. 

Under the Mine Act, an operator is held 

to a high standard of care. A mine 

operator is required to be on the alert for 

conditions and practices in the mine 

that affect the safety or health of miners 

and to take steps necessary to correct or 

prevent hazardous conditions or 

practices. The failure to exercise a high 

standard of care constitutes negligence. 

The negligence criterion assigns penalty 

points based on the degree to which the 

operator failed to exercise a high 

standard of care. When applying this 

criterion, MSHA considers mitigating 

circumstances which may include, but 

are not limited to, actions taken by the 

operator to prevent or correct hazardous 

conditions or practices. This criterion 

accounts for a maximum of 50 penalty 

points, based on conduct evaluated 

according to Table IX of this section. 

TABLE IX.—NEGLIGENCE

Categories Penalty 

points 

No negligence ............................... 0 

(The operator exercised diligence 

and could not have known of 

the violative condition or practice.) 

Low negligence ............................. 10 

(The operator knew or should 

have known of the violative 

condition or practice, but there 

are considerable mitigating circumstances.) 

Moderate negligence .................... 20 

(The operator knew or should 

have known of the violative 

condition or practice, but there 

are mitigating circumstances.) 

High negligence ............................ 35 

(The operator knew or should 

have known of the violative 

condition or practice, and there 

are no mitigating circumstances.) 

Reckless disregard ....................... 50 

(The operator displayed conduct 

which exhibits the absence of 

the slightest degree of care.) 

(e) Gravity. Gravity is an evaluation of 

the seriousness of the violation. This 

criterion accounts for a maximum of 88 

penalty points, as derived from the 

Tables X through XII of this section. 

Gravity is determined by: 

(1) The likelihood of the occurrence of 

the event against which a standard is 

directed; 

(2) The severity of the illness or injury 

if the event occurred or were to occur; 

and 

(3) The number of persons potentially 

affected if the event occurred or were to 

occur. 

TABLE X.—LIKELIHOOD

Likelihood of occurrence Penalty 

points 

No likelihood ................................. 0 

Unlikely ......................................... 10 

Reasonably likely .......................... 30 

Highly likely ................................... 40 

Occurred ....................................... 50 

TABLE XI.—SEVERITY

Severity of injury or illness if the 

event occurred or were to occur 

Penalty 

points 

No lost work days ......................... 0 

(All occupational injuries and illnesses as defined in 30 CFR 

part 50 except those listed 

below.) 

Lost work days or restricted duty 5 


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TABLE XI.—SEVERITY—Continued 

Severity of injury or illness if the 

event occurred or were to occur 

Penalty 

points 

(Any injury or illness which would 

cause the injured or ill person 

to lose one full day of work or 

more after the day of the injury 

or illness, or which would cause 

one full day or more of restricted duty.) 

Permanently disabling .................. 10 

(Any injury or illness which would 

be likely to result in the total or 

partial loss of the use of any 

member or function of the 

body.) 

Fatal .............................................. 20 

(Any work-related injury or illness 

resulting in death, or which has 

a reasonable potential to cause 

death.) 

TABLE XII.—PERSONS POTENTIALLY

AFFECTED

Number of persons potentially 

affected if the event occurred or 

were to occur 

Penalty 

points 

0 .................................................... 0 

1 .................................................... 1 

2 .................................................... 2 

3 .................................................... 4 

4 .................................................... 6 

5 .................................................... 8 

6 .................................................... 10 

7 .................................................... 12 

8 .................................................... 14 

9 .................................................... 16 

10 or more .................................... 18 

(f) The demonstrated good faith of the 

operator in abating violation. This 

criterion provides a 10% reduction in 

the penalty amount of a regular 

assessment where the operator abates 

the violation within the time set by the 

inspector. 

(g) Penalty conversion table. The 

penalty conversion table is used to 

convert the total penalty points to a 

dollar amount. 

TABLE XIII.—PENALTY CONVERSION

TABLE

Points Penalty 

($) 

60 or fewer ................................... 112 

61 .................................................. 121 

62 .................................................. 131 

63 .................................................. 142 

64 .................................................. 154 

65 .................................................. 167 

66 .................................................. 181 

67 .................................................. 196 

68 .................................................. 212 

69 .................................................. 230 

70 .................................................. 249 

71 .................................................. 270 

TABLE XIII.—PENALTY CONVERSION

TABLE—Continued 

Points Penalty 

($) 

72 .................................................. 293 

73 .................................................. 317 

74 .................................................. 343 

75 .................................................. 372 

76 .................................................. 403 

77 .................................................. 436 

78 .................................................. 473 

79 .................................................. 512 

80 .................................................. 555 

81 .................................................. 601 

82 .................................................. 651 

83 .................................................. 705 

84 .................................................. 764 

85 .................................................. 828 

86 .................................................. 897 

87 .................................................. 971 

88 .................................................. 1,052 

89 .................................................. 1,140 

90 .................................................. 1,235 

91 .................................................. 1,337 

92 .................................................. 1,449 

93 .................................................. 1,569 

94 .................................................. 1,700 

95 .................................................. 1,842 

96 .................................................. 1,995 

97 .................................................. 2,161 

98 .................................................. 2,341 

99 .................................................. 2,536 

100 ................................................ 2,748 

101 ................................................ 2,976 

102 ................................................ 3,224 

103 ................................................ 3,493 

104 ................................................ 3,784 

105 ................................................ 4,099 

106 ................................................ 4,440 

107 ................................................ 4,810 

108 ................................................ 5,211 

109 ................................................ 5,645 

110 ................................................ 6,115 

111 ................................................ 6,624 

112 ................................................ 7,176 

113 ................................................ 7,774 

114 ................................................ 8,421 

115 ................................................ 9,122 

116 ................................................ 9,882 

117 ................................................ 10,705 

118 ................................................ 11,597 

119 ................................................ 12,563 

120 ................................................ 13,609 

121 ................................................ 14,743 

122 ................................................ 15,971 

123 ................................................ 17,301 

124 ................................................ 18,742 

125 ................................................ 20,302 

126 ................................................ 21,993 

127 ................................................ 23,825 

128 ................................................ 25,810 

129 ................................................ 27,959 

130 ................................................ 30,288 

131 ................................................ 32,810 

132 ................................................ 35,543 

133 ................................................ 38,503 

134 ................................................ 41,574 

135 ................................................ 44,645 

136 ................................................ 47,716 

137 ................................................ 50,787 

138 ................................................ 53,858 

139 ................................................ 56,929 

140 or more .................................. 60,000 

(h) The effect of the penalty on the 

operator’s ability to continue in 

business. MSHA presumes that the 

operator’s ability to continue in 

business will not be affected by the 

assessment of a civil penalty. The 

operator may, however, submit 

information to the District Manager 

concerning the financial status of the 

business. If the information provided by 

the operator indicates that the penalty 

will adversely affect the operator’s 

ability to continue in business, the 

penalty may be reduced. 

§ 100.4 Unwarrantable failure. 

(a) The minimum penalty for any 

citation or order issued under section 

104(d)(1) of the Mine Act shall be 

$2,000. 

(b) The minimum penalty for any 

order issued under section 104(d)(2) of 

the Mine Act shall be $4,000. 

§ 100.5 Determination of penalty amount; 

special assessment. 

(a) MSHA may elect to waive the 

regular assessment under § 100.3 if it 

determines that conditions warrant a 

special assessment. 

(b) When MSHA determines that a 

special assessment is appropriate, the 

proposed penalty will be based on the 

six criteria set forth in § 100.3(a). All 

findings shall be in narrative form. 

(c) Any operator who fails to correct 

a violation for which a citation has been 

issued under section 104(a) of the Mine 

Act within the period permitted for its 

correction may be assessed a civil 

penalty of not more than $6,500 for each 

day during which such failure or 

violation continues. 

(d) Any miner who willfully violates 

the mandatory safety standards relating 

to smoking or the carrying of smoking 

materials, matches, or lighters shall be 

subject to a civil penalty which shall not 

be more than $275 for each occurrence 

of such violation. 

(e) Violations that are deemed to be 

flagrant under section 110(a)(2) of the 

Mine Act may be assessed a civil 

penalty of not more than $220,000. For 

purposes of this section, a flagrant 

violation means ‘‘a reckless or repeated 

failure to make reasonable efforts to 

eliminate a known violation of a 

mandatory health or safety standard that 

substantially and proximately caused, or 

reasonably could have been expected to 

cause, death or serious bodily injury.’’

(f) The penalty for failure to provide 

timely notification to the Secretary 

under section 103(j) of the Mine Act 

will be not less than $5,000 and not 

more than $60,000 for the following 

accidents: 

(1) The death of an individual at the 

mine, or 


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Federal Register / Vol. 71, No. 174 / Friday, September 8, 2006 / Proposed Rules 53075 

(2) An injury or entrapment of an 

individual at the mine which has a 

reasonable potential to cause death. 

§ 100.6 Procedures for review of citations 

and orders; procedures for assessment of 

civil penalties and conferences. 

(a) All parties shall be afforded the 

opportunity to review with MSHA each 

citation and order issued during an 

inspection. It is within the sole 

discretion of MSHA to grant a request 

for a conference and to determine the 

nature of the conference. 

(b) Upon notice by MSHA, all parties 

will have five days within which to 

submit additional information or 

request a safety and health conference 

with the District Manager or designee. A 

conference request may include a 

request to be notified of, and to 

participate in, a conference initiated by 

another party. 

(c) When a conference is conducted, 

the parties may submit any additional 

relevant information relating to the 

violation, either prior to or at the 

conference. To expedite the conference, 

the official assigned to the case may 

contact the parties to discuss the issues 

involved prior to the conference. 

(d) MSHA will consider all relevant 

information submitted in a timely 

manner by the parties with respect to 

the violation. When the facts warrant a 

finding that no violation occurred, the 

citation or order will be vacated. Upon 

conclusion of the conference, or 

expiration of the conference request 

period, all citations that are abated and 

all orders will be promptly referred to 

MSHA’s Office of Assessments. The 

Office of Assessments will use the 

citations, orders, and inspector’s 

evaluation as the basis for determining 

the appropriate amount of a proposed 

penalty. 

§ 100.7 Notice of proposed penalty; notice 

of contest. 

(a) A notice of proposed penalty will 

be issued and served by certified mail 

upon the party to be charged and by 

regular mail to the representative of 

miners at the mine after the time 

permitted to request a conference under 

§ 100.6 expires, or upon the completion 

of a conference, or upon review by 

MSHA of additional information 

submitted in a timely manner. 

(b) Upon receipt of the notice of 

proposed penalty, the party charged 

shall have 30 days to either: 

(1) Pay the proposed assessment. 

Acceptance by MSHA of payment 

tendered by the party charged will close 

the case. 

(2) Notify MSHA in writing of the 

intention to contest the proposed 

penalty. When MSHA receives the 

notice of contest, it advises the Federal 

Mine Safety and Health Review 

Commission (‘‘Commission’’) of such 

notice. No proposed penalty which has 

been contested before the Commission 

shall be compromised, mitigated or 

settled except with the approval of the 

Commission. 

(c) If the proposed penalty is not paid 

or contested within 30 days of receipt, 

the proposed penalty becomes a final 

order of the Commission and is not 

subject to review by any court or 

agency. 

§ 100.8 Service. 

(a) All operators are required by part 

41 (Notification of Legal Identity) of this 

chapter to file with MSHA the name and 

address of record of the operator. All 

representatives of miners are required 

by part 40 (Representative of Miners) of 

this chapter to file with MSHA the 

mailing address of the person or 

organization acting in a representative 

capacity. Proposed penalty assessments 

delivered to those addresses shall 

constitute service. 

(b) If any of the parties choose to have 

proposed penalty assessments mailed to 

a different address, the Office of 

Assessments must be notified in writing 

of the new address. Delivery to this 

address shall also constitute service. 

(c) Service for operators who fail to 

file under part 41 of this chapter will be 

upon the last known business address 

recorded with MSHA. 

[FR Doc. 06–7512 Filed 9–5–06; 1:11 pm] 

BILLING CODE 4510–43–U 


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