' ' 

S· DEPARTMENT OF THE INE-40 

OFFICE OF 

RECLAMATION A"Nio E.iN"FcilicE.i.ii~Ni 

SYSTEM 

1. This Directive establishes policy and procedures for 

the of Individual Civil Penalties (ICP's). The primary 

assessing an ICP is to motivate the responsible person(s) -•• : outstanding violation(s) or to lessen substantially any 

continuinq environmental harm or threat to the public health or 

safety, or to enable the Office of Surface Mining Reclamation and 

Enforcement (OSM) to take remedial action (to the extent authorized 

by Congress) using the monies collected from the ICP. 

2. svmmnrv of changes. This Directive explains agency policy and 

prescribes procedures to implement the ICP provisions of section 

518 (f) of the Surface Mining Control and Reclamation Act (the Act) 

and the at 30 CFR Parts 724 and 846. This Directive 

bas reorqanized 

the 

3. Definitions. 

a. a person who exercises authority and control 

over a operation on behalf of a corporate permittee. 

3664, February 8, 1988. under United States v. pix Fork 

692 F.2d 336 (6th Cir. 1982), an "agent includes that 

;:~~::~:-~~~w=ith the responsibility for protecting society and the 

e adverse effects of the surface coal mining operation and particularly charged with effectuating compliance with 

environmental performance standards during the course of a 

permittee's mining operation." 

b. Cornorate Officialls\ means the president and the directors 

of a corporation and any other officer or agent who has line 

responsibility with :respect to a mine site. 

c. 

Know, in 

the part of 

constituted 

846.5. 

means that an individual Knew, 

ordering, or carrying out an 

a corporate permittee that such act or 

a violation, failure, or refusal. See 

or had reason to 

act or omission on 

omission 

30 CFR 724.5 and 
d. Line responsibility with respect to a mine site means 

authority or demonstrated control over the conduct of surface coal 

mining operations, including the ability to directly cause the 

abatement of violations, and any level of supervisory responsibility 

over a person having such ability. (For example, the mine 

superintendent and each official in the superintendent's "chain of 

command," up to and including the chief executive officer, would have 

line responsibility with respect to the mine site.) 

e. means (1) a violation Of a 

condition a Federal program, a Federal 

lands program, pursuant to section 502 of the Act, 

or Federal enforcement of a State program pursuant to section 521 of 

the Act; or (2) a failure or refusal to comply with any order issued 

under section 521 of the Act, or any order incorporated in a final 

decision issued by the Secretary under the Act, except an order 

incorporated in a decision issued under section 518(b) or section 703 

of the Act. A ·failure or refusal to comply with any order issued 

under section 521 of the Act would include a failure or refusal to 

comply with an Imminent Harm Cessation Order (52l(a) (2)) or a Failure 

To Abate Cessation Order (52l(a}(3}}. See 30 CFR 724.5 and 846.5. 

f. Willfully means that an individual acted (1) either 

intentionally, voluntarily, or consciously, and (2) with intentional 

disregard or plain indifference to legal requirements in authorizing, ordering, or carrying out a corporate permittee's action or omission 

that constituted a violation, failure, or refusal. Sea 30 CFR 724.5 

ond 846.5. 

4, Policv/PrQcsdures. 

a. Section 518 (f) of the Act provides that a 

corporate willfully and knowingly authorizes, orders, or 

carries out a violation, failure, or refusal (as described above) may be assessed a civil penalty for violations committed by the 

corporation and shall be subject to the same civil penalties, fines, 

and imprisonment that may be imposed upon a person under sections 

51S{a) and 518(e) of the Act. Further, OSH is required under 30 CFR 

723.15(b) (2) and 845.15(b) {2) to take appropriate action pursuant to 

sections 518(e), 518(f), 52l(a) (4), or 52l(c) of the Act within 60 

days after a violation has remained unabated beyond the abatement 

period set in the notice or order to ensure that abatement occurs or 

to ensure that there will not be a reoccurrence of the failure to 

abate. 

OSM published a final rule on February 8, 1988 (53 FR 3664), whioh 

established a regulatory scheme for imposing individual civil 

penalties. Also, OSM has issued a Directive entitled, "Notice of 

Potential Liability for an Individual Civil Penalty" (INE-4), which 

provides guidance for informing a corporate official that he may be 

liable under certain circumstances for an ICP. 

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b. o;~,:;:;~t:l~:l::~::~:'c::::~:.c~, 51S(f) of the Act as part of ~ proqram. It is agency 

policy to ensure that: 

(1) For any Failure to Abate Cessation Order (FTACO) or 

Imminent Harm Cessation Order (IHCO) issued after the date of this 

Directive with respect to a site on which coal extraction had not been 

completed as of the time of issuance of the FTACO or IHCO: 

(a) All corporate officials are informed when the 

corporation with which they are affiliated is issued an FTACO or IHCO 

by OSM1 and 

(b) An ICP is proposed against each corporate official 

who bas been given a Notice of Potential Liability for an Individual 

civil Penalty, unless (i) abatement occurs within 30 days after 

issuance of an FTACo or within 30 days after the abatement date set 

for ;m IHCO, whichever is applicable, or {ii) within 45 days after 

issuance of an rrAco or within 45 days atter the abatement date ~~oet 

for an IHCO, whichever is applicable, the corporate official provides documentation that he or she has taken all reasonable steps within his 

or her authority to bring about abatement of the violation. 

(2) For any rl'ACO or IHCO issued. after the date of this 

Directive with respect to a site on which coal extraction had been 

completed as of the time of issuance of the FTACO or IHCO, and for any 

FTACO or lHCO issued prior to tha date of this Directive. with respect 

to any site: 

{a) The president or chief executive officer of a 

corporation is informed when the corporation with which he or she is 

affiliated. is issued an rl'ACO or IHCO by OSM. Service of the FTACO or 

IHOO on other directors, officers, or agents of the corporation is 

discretionary and should be decided on a case-by-case basis depending 

on the evidence of the particular person's responsibility for the 

violation, failure, or refusal at issue: and 

(b) OSM considers proposing an ICP against each 

individual who has been given a Notice of Potential Liability for an 

Individual civil Penalty, unless {i) abatement occurs within 30 days 

after issuance of an FTACO or within 30 days after the abatement date 

set for an IHCO, whichever is applicable, or {ii) within 45 days after 

issuance of an FTACO or within 45 days after the abatement date set 

for an IHCO, whichever is applicable, the corporate official provides documentation that he or she has taken all reasonable steps within his 

or her authority to bring about abatement of the violation. 

{3) ICP assessment amounts sufficiently reflect the costs 

of abatement in order to serve as an incentive to the individual to 

correct the violation, provided that the maximum ICP amount will not 
exceed the estimated cost of abatement plus a 10 percent incentive 

amount: 

(4) Each corporate official assessed an ICP is afforded ths 

rights of appeal described in paragraph 4.d. (5) (a) of this Directive; 

and 

(5) In cases where more than one individual may be liable 

for an ICP, each person meeting the criteria set forth in section 

4.d. (l) and section 4.d, (2) shall be assessed an ICP and held 

individually liable for payment of the penalty and jointly and 

severally liable for fulfilling the requirements set forth in an 

approved abatement plan as provided for in paragraph 4.d. (6) (c). 

c. Responsibilities. 

(1) Field Office Directors are responsible for 

investigating the circumstances surrounding any Cessation Order issued 

to a corporate permittee (as explained under sections 4.d. (l) and 

4.d. (2) below) in order to determine which, if any, individuals 

associated with the corporation knowingly and willfully authorized, 

ordered, or carried out the violation, failure, or refusal at issue. 

The Field Office Director ahall provide his or her determination to 

the Field Assessment Dnit within 60 days attar the issuance of an 

FTACO or within 60 days after the abatement data set for an IBOO, 

whichever is applicable. Field Office Directors, with the assistance 

of the Field Solicitor, are also responsible for entering into written 

abatement plans with individuals wishing to abate their violations. 

(I) for ensuring adequately 

Directive. 

(3) Field Assessment Qnits are responsible for: 

(a) Deciding whether to propose one or more ICP's for 

an FTACO or IHOO within 30 days of receipt of any ICP referral from a 

Field Office Director: 

(b) Assigning each ICP a unique identification number 

consistent with the applicable identification numbering scheme 

established by the Division of Debt Management's Collection Management Information System (CMIS) guide; 

(o) 

Penalty Assessment, 

Issuing Notices of Proposed Individual Civil 

Final Orders, and Demand Letters; 

(d) Inputting and tracking ICP data in CMIS; ana 

(e) Meeting the reporting requirements described in 

section 5 below. 
d. Procedures. 

(1) For any FTACO or IHCO issued after the date of this 

Directive with respect to a site on which coal extraction had not been 

completed as of the time of issuance of the FTACO or IHCO, the Field 

Assessment Unit shall propose an ICP when the following criteria are 

met: 

(a) A violation remains unabated after 30 days following issuance of an FTACO or 30 days following the abatement date 

set for an IHCO, whichever is applicable: 

(b) The violator entity with which the individual is 

associated was incorporated under applicable State law at the time the 

violation, failure, or refusal occurred: 

(c) The individual was a corporate official (ae 

defined in paraqraph 3.b. above) at the time the violation occurred or 

during the time a failure or refusal to comply continued; 

(d) The corporate official knows of the cessation 

order and has been served a •Notice of Potential Liability for an 

Individual civil Penalty• or equivalent doO\llllent; and 

{e) The corporate official has failed within 4.5 days after the issuance of an F'l'ACO or within 45 days of the abatement· date 

set for an IHCO, whichever is applicable, to provide documentation 

that he or she has taken all reasonable steps within his or her 

authority to -bring about abatement of the violation. 

(2) For any FTACO or IHCO issued after the date of this 

Directive with respect to a site on which coal extraction had been 

completed as of the time of issuance of the FTACO or IHCO, and for any 

FTACO or IHCO issued prior to the date of this Directive with respect 

to any site, the Field Assessment Unit shall consider the following criteria when deciding whether to assess an ICP: 

(a) A violation rel!lains unabated after 30 days following issuance of an FTACO or 30 days following the abatement date 

set for an IHCO, whichever is applicable; 

{b) The Field Office Director has referred the 

cessation order to the Field Solicitor for injunctive relief or 

criminal penalties in accordance with the applicable Alternative 

Enforcement Directive, and the Field Solicitor has declined to 

initiate an action for injunctive relief; or the Field Solicitor has 

requested that OSM assess an ICP in combination with ongoing litigation in situations where the Field Solicitor believes that such 

an approach will assist in bringing about abatement of the 

violation(s); 

5 
(c) The violator entity with which the individual is 

associated was incorporated under applicable state law at the time the 

violation, failure, or refusal occurred; 

(d) The individual was a director, officer, or agent of the corporation to which the Cessation Order was issued at the time 

the violation occurred or during the time a failure or refusal to 

comply continued; 

(e) The individual knows of the cessation Order and 

has been served a "Notice of Potential Liability for an Individual 

Civil Penalty" or equivalent document; 

(f) The individual has failed within 45 days after the 

issuance of an FTACO or within 45 days of the abatement date set for 

an IHCO, whichever is applicable, to provide documentation that he or 

she has taken all reasonable steps within his or her authority to 

bring about abatement of the violation, or other evidence exists which 

establishes that the individual willfully and knowingly authorized, 

ordered, or carried out the violation, failure, or refusal: and 

(g) The individual has sufficient assets to warrant 

issuance of an ICP. 

(i) If the Field Assessment unit has reason to 

believe that an individual may have insufficient assets to warrant 

issuanc• of an ICP, the Field Assessment unit may order a net worth 

determination (NWD) through the Division of Debt Management. 

(ii) In cases where more than one person may be 

liable for an ICP, additional corisideration will be given to the 

cumulative net worth of the individuals to determine whether 

sufficient assets exist for the individuals acting either alone or 

together to abate the cessation order or to lessen substantially any continuing anvirom~~ental harm or threat to the public health or 

safety. 

(iii) If the individual's net worth as determined 

under paragraphs (g) (i) and {g) (ii) above is inadequate for the 

individual(s) to abate the Cessation Order or to lessen substantially 

any continuing environmental harm or threat to the public health or 

safety, then the individual(s) will be considered ineligible for an 

ICP, no ICP will be assessed, and the decision not to assess an ICP 

will be documented. 

{3) The Field Assessment Unit shall consider the following criteria when determining the amount of an ICP: 

(a) The individual's history of authorizing, ordering, 

or carrying out previous violations, failures, or refusals at the 

particular surface coal mining operation where the unabated cessation 

Order has been issued. For every Cessation Order previously issued on 

6 
that particular surface coal mining operation, the Field Assessment 

Unit will assess the individual $500 if the individual was, at the 

time of issuance of such order, in a position of authorizing, ordering, or carrying out such violation. Conversely, if no prier Cessation Orders were identified that met this criterion, there would 

be no penalty amount assessment for history. 

The maximum amount the Field Assessment Unit may assess an individual 

per day based on history is $~,000 (the equivalent of four prior Cessation Orders). 

(b) The seriousness of the violation, failure, or 

refusal, as indicated by the extent of damage andjor the cost of 

reclamation, including any irreparable harm to the environment and any hazard to the health or safety of the pUblic. The Field Assessment 

Unit shall determine from information SUpPlied in the Field Office 

documentation (i) the degree of enviromaental harm, public health 

hazard, or safety hazard caused by the violation and (ii) whether the 

damage caused by the violation was confined to or extended beyond the 

permit area. Based upon this information the Field Assessment Unit 

will assess the individual the following amounts: 

Environmental Harm 

None 

Insignificant 

Moderate 

Significant 

Extent of pomage 

Confined within Permit Area 

Extending outside Permit Area 

Aaaessment Range rDollarsl 

0 

0 - 500 

501 - 1,000 

1,001 - 1,500 

Anessment Range cpouaral 

0 - 700 

701 - 1,500 

' 

The maximum the Field Assessment Unit may assess an individual per day based on seriousness of the violation is $3,000. 

{c) The demonstrated good faith of the individual in 

attempting to achieve rapid compliance after receiving notice of the 

Cessation Order. In applying good faith, the Field Assessment Unit 

will apply the criteria governing good faith found at 30 CFR 

845.13 (b) (4) and in thG: Civil Penalty Assessment Manual Directive 

(CAA-1). 

(d) The amount of the penalty determinea under section 

4.d. (3) (a)-(c) above will be assessed for each day the violation, 

failure, or refusal continues from the date of service on the 

individual of the Cessation Order or other order incorporatea in a 

final decision, until abatement or compliance is achieved. 

(e) The total ICP penalty amount shall not exceed the 

estimated cost of abatement plus a 10 percent incentive amount. 

' 
(4) The Field Assessment Unit shall ensure that the Notice 

of Proposed Assessment (NOPA) is personally served on the individual, 

together with a narrative explaining the reasons for the penalty {see 

Appendix 1), the amount to be assessed, and a copy of the underlying Notice of Violation and Cessation Order which was issued to the 

corporate permittee. service shall be by hand delivery or certified 

mail (restricted delivery), in accordance with the procedures set 

forth in Directive INE-8 for the service of Notices of Violation and 

cessation orders, or in accordance with the terms of any service 

contract OSM may have in place at the t~. 

(5) The NOPA shall become a final order 30 days after 

personal service upon the individual unless within that time: 

(a) The individual files in accordance with 43 CFR 

4.1300 n AS• a petition for review with the Hearings Division of the 

Office of Bearings and Appeals; or 

{b) The Field Office Director ~d the individual(s) or 

responsible corporate permittee aqree to a schedule or plan for the 

abatement or correction of the violation, failure, or refusal. 

(6) Payplpnt of ICP and penaltv withdrawal. 

{a) If a NOPA beCOIIIes a tinal order in the absence of 

a petition for review or abatement agreeJMnt, the penalty shall be due 

upon issuance of the final order as required by Directive CAA-1, 

"Civil Penalty Assessment Manual." 

(b) If an individual named in a NOPA files a petition for review in accordance with 43 CFR 4.1300 .m; ~·· the penalty shall 

be due upon issuance of a final administrative order by the Office of 

Hearings and Appeals. 

(c) If the Field Office Director and the individual(s) 

have agreed in writing on a satisfactory plan for compliance with an 

unabated cessation Order, the Field Assessment unit may allow the 

individual(s) to delay payment of the NOPA until either the issuance 

of a final order stating that the penalty is due, or a written notice 

stating that abatement or compliance has been completed and the 

penalty has been withdrawn. A final order will be issued under this 

paragraph only in cases where an individual has defaulted on the 

abatement plan. In such circumstances, the Field Assessment Unit may issue a final order for the full penalty amount or for a modified 

amount reduced tc reflect any partial abatement. In situations where 

more than one individual has been assessed an ICP and one of the 

individuals completes the abatement actions, the penalties assessed 

against that individual as well as the other remaining individuals 

will be withdrawn if they have not become final. 

8 
(d) In the event payment of the ICP will be delayed because an abatement plan has been agreed to, the Field Assessment 

Unit will provide written notice to the individual(s) that the 

deadline to file an appeal of the proposed ICP assessment cannot be 

extended under 43 CFR 4.1302. 

~~· Field Assessment Units shall prepare and 

a quarterly report specifying the name of 

every i~•'!t :whom OSM has assessed an ICP pursuant to 

section , the amount of the penalty, the current 

status of penalty, and the nallle of all individuals who OSM bas 

determined are ineligible for assessment of an ICP pursuant to section 

518(f) of the Act. 

6. References. 

a. Section 518{f) of the Act. 

b. 30 CFR Part 724. 

c. 30 CFR Part 846, 

d. 30 CFR section 701.5. 

e. 43 CFR Section 4.1300 at aag. 

f. Directive INE-4, "Notice of Potential Liability for an 

Individual Civil Penalty," dated. March 1, 1990. 

g. Directive INE-8, "Service of Notices of Violation and 

cessation Order11, 11 dated Hay 19, 1983. 

b. Directive INE-30, "Alternative Enforcement Referrals for 

Criminal Penalties, Individual civil Penalties and Injunctive Relief," 

dated March 1990. 

i. CAA-1, "Civil Penalty Assessment Manual," dated 

692 F.2d 336 (6th Cir. • 

1. Collection Management Information System Guide as issued by 

the Division of Debt Management in February 1988 and. as modified 

thereafter. 

7. 

89-23, ~~·ty Supersedes Temporary Directive No. e: Assessments," dated July 6, 1989. 

8. Effective Date, Upon Issuance. 

9. Contact. Chief, Branch of Inspection and Enforcement (202) 343-

4550. 

10. List ot Appendices, 

Appendix 1: Notice of Proposed Assessment of an Individual 

Civil Penalty Under section 518(f) of the Surface Mining Control and 

Reclamation Act of 1977, 30 U.S.C. l268(f), 

' 
Appendix 1 

NOTICE OF PROPOSED ASSESSMENT OF AN INDIVIDUAL CIVIL PENADTY 

UNDER SECTION 518(f) OF THE SURFACE MINING CONTROL AND 

RECLAMATION ACT OF 1977, 30 U.S.C. 126S(f). 

(Corporate Official) 

(Title) 

(Address) 

(Corporate Permittee) 

Individual Civil 

Penalty No. 

The Office of Surface Mininq Reclamation and Enforcement (OSM), 

pursuant to Section 51S(f) of the Surface Mining Control and 

Recluation Act of 1977 (SKCRA), Jo u.s. c. 1268(f), ~~~ay assess an 

individual civil penalty aqainst a director, officer, or agent of. a 

corporate permittee wbicb bas violated a condition of its permit or 

has failed or refused to a 

•• 

to 

individual civil penalty Notice of Violation and 

has determined that, as 

corporation, you have 

carried out a violation, 

proposes the assessment of an 

the amount of $ In 

the criteria specified in the 

either 724 or 846) which are: 

violations sueh 

not been and OSM 

or aqent a 

authorized, ordered, or 

comply. OSM therefore 

penalty against you in 

penalty OSM has applied 

at 30 CFR Part {insert 

{1) Your history (if any) of authorizing, ordering, or carryingout previous violations, failures, or refusals to comply at the 

particular surface coal mining operation; 

(2) The seriousness of the violation, failure, or refusal to 

comply (as indicated by the extent of damaqe andjor the cost or 

reclamation), including any irreparable harm to the environment and 

any hazard to the health cr safety of the public; and 
(3) Your demonstrated good faith (if any) in attempting to 

achieve rapid compliance after notice of the violation, failure, or 

refusal to comply. 

Under the Federal rules at 30 CFR 724.14(b) and 846.14(b), the amount 

of a proposed penalty shall not exceed $5,000 for each violation. 

However, each day of a continuing violation may be deemed a separate violation, and OSM may assess a separate individual civil penalty for 

each day the violation, failure, or refusal continues, from the date 

of service of the underlying notice of violation, cessation order, or 

other order incorporated in a final decision issued by the secretary, until abatement or compliance is achieved. 

If you wish to abate the outstanding violation(s) listed in the 

enclosed notice of violation and cessation order or wish to execute in 

writing a plan tor abatement of the outstanding violation(s), please 

contact me at • Abatement of the outstanding violation(s) withdraw the proposed individual 

civil penalty listed in 30 CFR 724.1S(c) and 

S46.l.S(c). 

In accordance with 43 CFR, Part 4, Section 4.1300 you have the right 

to appeal this decision within 30 days from the date of receipt of 

this notice. You may appeal by filing a written notice of appeal with 

me and at the same time sending a copy of the notice to the Office of 

Hearings and Appeals, 4015 Wilson Boulevard, Arlington, virginia 22203. The notice of appeal must indicate that an appeal is intended 

and must identify the individual civil penalty number listed above and 

the date on which you received. this letter. The notice may include a 

statement of reasons for the appeal and .any arguments that you choose 

to make. If the notice of appeal does not include a statement of 

reasons for appeal, a statement must be filed. with the Office of 

Hearings and Appeals within 20 days after filing the notice of appeal. 

This proposed penalty will become final and payable within 30 days from the date you receive this letter, unless within that time you file an appeal or enter into an abatement agreement as explained above. Payments should be made by check or money order payable to 

"Assessment Office--OSM" and sent to: 

Office of Surface Mining Reclamation and Enforcement 

P.O. Box 360292 M 

Pittsburgh, Pennsylvania 1525l 

To assure proper credit of your payment, you must note on the check or 

money order the individual civil penalty number for which payment is 

being made. 
Please read this letter carefully. If you have any questions which 

are not answered by this letter, please contact me at the phone number 

listed above, 

Enclosures 

Sincerely, 

Chief, Field 

Assessment Unit