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 Environmental Protection Agency 40 CFR Part 19
[FRL-9972-92-OECA]
 AGENCY: Environmental Protection Agency (EPA).
 ACTION: Final rule.
 SUMMARY: The Environmental Protection Agency (EPA) is promulgating this final rule to adjust the level of statutory civil monetary penalty amounts under the statutes EPA administers. This action is mandated by the Federal Civil Penalties Inflation Adjustment Act of 1990, as amended through the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015 (“the 2015 Act”). The 2015 Act prescribes a formula for annually adjusting statutory civil penalties to reflect inflation, maintain the deterrent effect of statutory civil penalties, and promote compliance with the law. The rule does not necessarily revise the penalty amounts that EPA chooses to seek pursuant to its civil penalty policies in a particular case. EPA's civil penalty policies, which guide enforcement personnel in how to exercise EPA's statutory penalty authorities, take into account a number of fact-specific considerations, 
                        *e.g.,*
                         the seriousness of the violation, the violator's good faith efforts to comply, any economic benefit gained by the violator as a result of its noncompliance, and a violator's ability to pay.
 DATES: This final rule is effective on January 15, 2018.
 FOR FURTHER INFORMATION CONTACT: David Smith-Watts, Office of Civil Enforcement, Office of Enforcement and Compliance Assurance, Mail Code 2241A, Environmental Protection Agency, 1200 Pennsylvania Avenue NW, Washington, DC 20460, telephone number: (202) 564-4083; 
                        *smith-watts.david@epa.gov*.


SUPPLEMENTARY INFORMATION: I. Background Since 1990, federal agencies have been required to issue regulations adjusting for inflation the statutory civil penalties [1]
                    
                     that can be imposed under 
                    ( print page 1191)
                    the laws administered by that agency. The Federal Civil Penalties Inflation Adjustment Act of 1990, as amended by the Debt Collection Improvement Act of 1996 (DCIA), required agencies to review their statutory civil penalties every 4 years, and to adjust the statutory civil penalty amounts for inflation if the increase met the DCIA's adjustment methodology. In accordance with the DCIA, EPA reviewed and, as appropriate, adjusted the civil penalty levels under each of the statutes the agency implements in 1996 (61 FR 69360), 2004 (69 FR 7121), 2008 (73 FR 75340), and 2013 (78 FR 66643). The 2015 Act [2]
                    
                     requires agencies to: (1) Adjust the level of statutory civil penalties with an initial “catch-up” adjustment through an interim final rulemaking; and (2) beginning January 15, 2017, make subsequent annual adjustments for inflation. The purpose of the 2015 Act is to maintain the deterrent effect of civil penalties by translating originally enacted statutory civil penalty amounts to today's dollars and rounding statutory civil penalties to the nearest dollar. As required by the 2015 Act, EPA issued a catch up rule on July 1, 2016, which was effective August 1, 2016 (81 FR 43091), and EPA made its first annual adjustment on January 12, 2017, which was effective January 15, 2017 (82 FR 3633). Today's rule implements the second annual penalty inflation adjustments mandated by the 2015 Act. Section 4 of the 2015 Act requires each federal agency to publish annual adjustments to all civil penalties under the laws implemented by that agency. These annual adjustments are required to be published by January 15 of each year. The 2015 Act describes the method for calculating the adjustments. Each statutory maximum civil monetary penalty is multiplied by the cost-of-living adjustment, which is the percentage by which the Consumer Price Index for all Urban Consumers (CPI-U) for the month of October 2017 exceeds the CPI-U for the month of October 2016. With this rule, the new statutory maximum (or minimum [3]
                    
                    ) penalty levels listed in the sixth column of Table 2 of 40 CFR 19.4 will apply to all civil penalties assessed on or after January 15, 2018, for violations that occurred after November 2, 2015, when the 2015 Act was enacted. The former maximum statutory civil penalty levels, which are in the fifth column of Table 2 to 40 CFR 19.4, will now apply only to violations that occurred after November 2, 2015, where the penalties were assessed on or after January 15, 2017 but before January 15, 2018. The statutory penalty levels for violations that occurred after November 2, 2015, where the penalties were assessed on or after August 1, 2016 but before January 15, 2017, are codified in the fourth column of Table 2 to 40 CFR 19.4. The statutory civil penalty levels that apply to violations that occurred on or before November 2, 2015, are codified at Table 1 to 40 CFR 19.4. The formula for determining the cost-of-living or inflation adjustment to statutory civil penalties consists of the following steps: *Step 1:*
                     The cost-of-living adjustment multiplier for 2018, based on the CPI-U of October 2017, is 1.02041.[4]
                    
                     Multiply 1.02041 by the current penalty amount. This is the raw adjusted penalty value. *Step 2:*
                     Round the raw adjusted penalty value. Section 5 of the 2015 Act states that any adjustment shall be rounded to the nearest multiple of $1. The result is the final penalty value for the year. II. The 2015 Act Requires Federal Agencies To Publish Annual Penalty Inflation Adjustments Notwithstanding Section 553 of the Administrative Procedures Act Section 4 of the 2015 Act directs federal agencies to publish the second annual adjustments no later than January 15, 2018. In accordance with section 553 of the Administrative Procedures Act (APA), most rules are subject to notice and comment and are effective no earlier than 30 days after publication in the 
                    **Federal Register**
                    . However, Section 4(b)(2) of the 2015 Act provides that each agency shall make the annual inflation adjustments “notwithstanding section 553” of the APA. According to OMB guidance issued to Federal agencies on the implementation of the 2018 annual adjustment,[5]
                    
                     the phrase “notwithstanding section 553” means that “the public procedure the APA generally provides—notice, an opportunity for comment, and a delay in effective date—is not required for agencies to issue regulations implementing the annual adjustment.” Consistent with the language of the 2015 Act and OMB's implementation guidance, this rule is not subject to notice and an opportunity for public comment and will be effective immediately upon publication. III. Statutory and Executive Order Reviews Additional information about these statutes and Executive Orders can be found at 
                    *http://www2.epa.gov/​laws-regulations/​laws-and-executive-orders*. A. Executive Order 12866: Regulatory Planning and Review and Executive Order 13563: Improving Regulation and Regulatory Review This action is not a significant regulatory action and was therefore not submitted to the Office of Management and Budget (OMB) for review. B. Executive Order 13771: Reducing Regulations and Controlling Regulatory Costs This action is not an Executive Order 13771 regulatory action because this action is not significant under Executive Order 12866. C. Paperwork Reduction Act (PRA) This action does not impose an information collection burden under the PRA. This rule merely increases the level of statutory civil penalties that can be imposed in the context of a federal civil administrative enforcement action or civil judicial case for violations of EPA-administered statutes and their implementing regulations. D. Regulatory Flexibility Act (RFA) This action is not subject to the RFA. The RFA applies only to rules subject to notice and comment rulemaking requirements under the APA, 5 U.S.C. 553, or any other statute. Because the 2015 Act directs Federal agencies to publish this rule notwithstanding section 553 of the APA, this rule is not subject to notice and comment requirements or the RFA.
                    ( print page 1192) E. Unfunded Mandates Reform Act (UMRA) This action does not contain any unfunded mandate as described in UMRA, 2 U.S.C. 1531-1538, and does not significantly or uniquely affect small governments. This action is required by the 2015 Act, without the exercise of any policy discretion by EPA. This action also imposes no enforceable duty on any state, local or tribal governments or the private sector. Because the calculation of any increase is formula-driven pursuant to the 2015 Act, EPA has no policy discretion to vary the amount of the adjustment. F. Executive Order 13132: Federalism This action does not have federalism implications. It will not have a substantial direct effect 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. G. Executive Order 13175: Consultation and Coordination With Indian Tribal Governments This action does not have tribal implications as specified in Executive Order 13175. This rule merely reconciles the real value of current statutory civil penalty levels to reflect and keep pace with the levels originally set by Congress when the statutes were enacted. The calculation of the increases is formula-driven and prescribed by statute, and EPA has no discretion to vary the amount of the adjustment to reflect any views or suggestions provided by commenters. Accordingly, this rule will not have a substantial direct effect on tribal governments, 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. H. Executive Order 13045: Protection of Children From Environmental Health Risks and Safety Risks The EPA interprets Executive Order 13045 as applying only to those regulatory actions that concern environmental health or safety risks that the EPA has reason to believe may disproportionately affect children, per the definition of “covered regulatory action” in section 2-202 of the Executive Order. This action is not subject to Executive Order 13045 because it does not concern an environmental health risk or safety risk. I. Executive Order 13211: Actions That Significantly Affect Energy Supply, Distribution, or Use This action is not subject to Executive Order 13211, because it is not a significant regulatory action under Executive Order 12866. J. National Technology Transfer and Advancement Act (NTTAA) The rulemaking does not involve technical standards. K. Executive Order 12898: Federal Actions To Address Environmental Justice in Minority Populations and Low-Income Populations The EPA believes that this action is not subject to Executive Order 12898 (59 FR 7629, February 16, 1994) because it does not establish an environmental health or safety standard. Rather, this action is mandated by the 2015 Act, which prescribes a formula for adjusting statutory civil penalties on an annual basis to reflect inflation. L. Congressional Review Act (CRA) This action is subject to the CRA, and EPA will submit a rule report to each House of the Congress and to the Comptroller General of the United States. The CRA allows the issuing agency to make a rule effective sooner than otherwise provided by the CRA if the agency makes a good cause finding that notice and comment rulemaking procedures are impracticable, unnecessary or contrary to the public interest (5 U.S.C. 808(2)). The 2015 Act directs Federal agencies to publish their annual penalty inflation adjustments “notwithstanding section 553 [of the APA].” Because OMB has instructed Federal agencies that this provision means that “notice, an opportunity for comment, and a delay in the effective date” are not required for agencies to issue regulations implementing the annual adjustment,[6]
                    
                     EPA finds that the APA's notice and comment rulemaking procedures are impracticable, unnecessary or contrary to the public interest. List of Subjects in 40 CFR Part 19 Environmental protection
Administrative practice and procedure
Penalties
 Dated: January 3, 2018. E. Scott Pruitt, Administrator.
 For the reasons set out in the preamble, EPA amends title 40, chapter I, part 19 of the Code of Federal Regulations as follows: PART 19—ADJUSTMENT OF CIVIL MONETARY PENALTIES FOR INFLATION
 1.The authority citation for part 19 continues to read as follows: Authority:
                        Pub. L. 101-410, Oct. 5, 1990, 104 Stat. 890, as amended by Pub. L. 104-134, title III, sec. 31001(s)(1), Apr. 26, 1996, 110 Stat. 1321-373; Pub. L. 105-362, title XIII, sec. 1301(a), Nov. 10, 1998, 112 Stat. 3293; Pub. L. 114-74, title VII, sec. 701(b), Nov. 2, 2015, 129 Stat. 599. 2.Revise § 19.2 to read as follows: § 19.2
  The statutory penalty levels in the last column of Table 1 to § 19.4 apply to all violations which occurred after December 6, 2013 through November 2, 2015, and to violations occurring after November 2, 2015, where penalties were assessed before August 1, 2016. The statutory civil penalty levels set forth in the fourth column of Table 2 of § 19.4 apply to all violations which occurred after November 2, 2015, where the penalties were assessed on or after August 1, 2016 and before January 15, 2017. The statutory civil penalty levels set forth in the fifth column of Table 2 of § 19.4 apply to all violations which occurred after November 2, 2015, where the penalties were assessed after January 15, 2017 but before January 15, 2018. The statutory civil penalty levels set forth in the sixth and last column of Table 2 of § 19.4 apply to all violations which occur or occurred after November 2, 2015, where the penalties are assessed after January 15, 2018.
 3.In § 19.4, revise the introductory text and table 2 to read as follows: § 19.4
  Table 1 to § 19.4 sets out the statutory civil penalty provisions of statutes administered by EPA, with the original statutory civil penalty levels, as enacted, and the operative statutory civil penalty levels, as adjusted for inflation, for violations that occurred on or before November 2, 2015, and for violations that occurred after November 2, 2015, where penalties were assessed before August 1, 2016. Table 2 to § 19.4 sets out the statutory civil penalty provisions of statutes administered by EPA, with the third column displaying the original statutory civil penalty levels, as enacted. The fourth column of Table 2 displays the operative statutory civil penalty levels where penalties were assessed on or after August 1, 2016 but before January 15, 2017, for violations that occurred after November 2, 2015. The fifth column displays the operative statutory civil penalty levels 
                            ( print page 1193)
                            where penalties are assessed on or after January 15, 2017 but before January 15, 2018, for violations that occur or occurred after November 2, 2015. The sixth and last column displays the operative statutory civil penalty levels where penalties are assessed on or after January 15, 2018, for violations that occur or occurred after November 2, 2015. 
 Table 2 of Section 19.4—Civil Monetary Penalty Inflation Adjustments
U.S. Code citation
Environmental statute
Statutory civil penalties, as enacted
Statutory civil penalties for violations that occurred after November 2, 2015, where penalties are assessed on or after August 1, 2016 but before January 15, 2017
Statutory civil penalties for violations that occurred after November 2, 2015, where penalties are assessed on or after January 15, 2017 but before January 15, 2018
Statutory civil penalties for violations that occurred after November 2, 2015, where penalties are assessed on or after January 15, 20187 U.S.C. 136
                                    *l.*
                                    (a)(1)
FEDERAL INSECTICIDE, FUNGICIDE, AND RODENTICIDE ACT (FIFRA)
$5,000
$18,750
$19,057
$19,4467 U.S.C. 136
                                    *l.*
                                    (a)(2) 1
FIFRA
1,000/500/1,000
2,750/1,772/2,750
2,795/1,801/2,795
2,852/1,838/2,79515 U.S.C. 2615(a)(1)
TOXIC SUBSTANCES CONTROL ACT (TSCA)
25,000
37,500
38,114
38,89215 U.S.C. 2647(a)
TSCA
5,000
10,781
10,957
11,18115 U.S.C. 2647(g)
TSCA
5,000
8,908
9,054
9,23931 U.S.C. 3802(a)(1)
PROGRAM FRAUD CIVIL REMEDIES ACT (PFCRA)
5,000
10,781
10,957
11,18131 U.S.C. 3802(a)(2)
PFCRA
5,000
10,781
10,957
11,18133 U.S.C. 1319(d)
CLEAN WATER ACT (CWA)
25,000
51,570
52,414
53,48433 U.S.C. 1319(g)(2)(A)
CWA
10,000/25,000
20,628/51,570
20,965/52,414
21,393/53,48433 U.S.C. 1319(g)(2)(B)
CWA
10,000/125,000
20,628/257,848
20,965/262,066
21,393/267,41533 U.S.C. 1321(b)(6)(B)(i)
CWA
10,000/25,000
17,816/44,539
18,107/45,268
18,477/46,19233 U.S.C. 1321(b)(6)(B)(ii)
CWA
10,000/125,000
17,816/222,695
18,107/226,338
18,477/230,95833 U.S.C. 1321(b)(7)(A)
CWA
25,000/1,000
44,539/1,782
45,268/1,811
46,192/1,84833 U.S.C. 1321(b)(7)(B)
CWA
25,000
44,539
45,268
46,19233 U.S.C. 1321(b)(7)(C)
CWA
25,000
44,539
45,268
46,19233 U.S.C. 1321(b)(7)(D)
CWA
100,000/3,000
178,156/5,345
181,071/5,432
184,767/5,54333 U.S.C. 1414b(d)(1)
MARINE PROTECTION, RESEARCH, AND SANCTUARIES ACT (MPRSA)
600
1,187
1,206
1,23133 U.S.C. 1415(a)
MPRSA
50,000/125,000
187,500/247,336
190,568/251,382
194,457/256,51333 U.S.C. 1901 note (
                                    *see*
                                     1409(a)(2)(A))
CERTAIN ALASKAN CRUISE SHIP OPERATIONS (CACSO)
10,000/25,000
13,669/34,172
13,893/34,731
14,177/35,44033 U.S.C. 1901 note (
                                    *see*
                                     1409(a)(2)(B))
CACSO
10,000/125,000
13,669/170,861
13,893/173,656
14,177/177,20033 U.S.C. 1901 note (
                                    *see*
                                     1409(b)(1))
CACSO
25,000
34,172
34,731
35,44033 U.S.C. 1908(b)(1)
ACT TO PREVENT POLLUTION FROM SHIPS (APPS)
25,000
70,117
71,264
72,71833 U.S.C. 1908(b)(2)
APPS
5,000
14,023
14,252
14,54342 U.S.C. 300g-3(b)
SAFE DRINKING WATER ACT (SDWA)
25,000
53,907
54,789
55,90742 U.S.C. 300g-3(g)(3)(A)
SDWA
25,000
53,907
54,789
55,90742 U.S.C. 300g-3(g)(3)(B)
SDWA
5,000/25,000
10,781/37,561
10,957/38,175
11,181/38,95442 U.S.C. 300g-3(g)(3)(C)
SDWA
25,000
37,561
38,175
38,95442 U.S.C. 300h-2(b)(1)
SDWA
25,000
53,907
54,789
55,90742 U.S.C. 300h-2(c)(1)
SDWA
10,000/125,000
21,563/269,535
21,916/273,945
22,363/279,53642 U.S.C. 300h-2(c)(2)
SDWA
5,000/125,000
10,781/269,535
10,957/273,945
11,181/279,53642 U.S.C. 300h-3(c)
SDWA
5,000/10,000
18,750/40,000
19,057/40,654
19,446/41,48442 U.S.C. 300i(b)
SDWA
15,000
22,537
22,906
23,37442 U.S.C. 300i-1(c)
SDWA
100,000/1,000,000
131,185/1,311,850
133,331/1,333,312
136,052/1,360,52542 U.S.C. 300j(e)(2)
SDWA
2,500
9,375
9,528
9,72242 U.S.C. 300j-4(c)
SDWA
25,000
53,907
54,789
55,90742 U.S.C. 300j-6(b)(2)
SDWA
25,000
37,561
38,175
38,95442 U.S.C. 300j-23(d)
SDWA
5,000/50,000
9,893/98,935
10,055/100,554
10,260/102,60642 U.S.C. 4852d(b)(5)
RESIDENTIAL LEAD-BASED PAINT HAZARD REDUCTION ACT OF 1992
10,000
16,773
17,047
17,39542 U.S.C. 4910(a)(2)
NOISE CONTROL ACT OF 1972
10,000
35,445
36,025
36,76042 U.S.C. 6928(a)(3)
RESOURCE CONSERVATION AND RECOVERY ACT (RCRA)
25,000
93,750
95,284
97,22942 U.S.C. 6928(c)
RCRA
25,000
56,467
57,391
58,56242 U.S.C. 6928(g)
RCRA
25,000
70,117
71,264
72,71842 U.S.C. 6928(h)(2)
RCRA
25,000
56,467
57,391
58,56242 U.S.C. 6934(e)
RCRA
5,000
14,023
14,252
14,54342 U.S.C. 6973(b)
RCRA
5,000
14,023
14,252
14,54342 U.S.C. 6991e(a)(3)
RCRA
25,000
56,467
57,391
58,56242 U.S.C. 6991e(d)(1)
RCRA
10,000
22,587
22,957
23,42642 U.S.C. 6991e(d)(2)
RCRA
10,000
22,587
22,957
23,42642 U.S.C. 7413(b)
CLEAN AIR ACT (CAA)
25,000
93,750
95,284
97,22942 U.S.C. 7413(d)(1)
CAA
25,000/200,000
44,539/356,312
45,268/362,141
46,192/369,53242 U.S.C. 7413(d)(3)
CAA
5,000
8,908
9,054
9,23942 U.S.C. 7524(a)
CAA
25,000/2,500
44,539/4,454
45,268/4,527
46,192/4,61942 U.S.C. 7524(c)(1)
CAA
200,000
356,312
362,141
369,53242 U.S.C. 7545(d)(1)
CAA
25,000
44,539
45,268
46,19242 U.S.C. 9604(e)(5)(B)
COMPREHENSIVE ENVIRONMENTAL RESPONSE, COMPENSATION, AND LIABILITY ACT (CERCLA)
25,000
53,907
54,789
55,90742 U.S.C. 9606(b)(1)
CERCLA
25,000
53,907
54,789
55,90742 U.S.C. 9609(a)(1)
CERCLA
25,000
53,907
54,789
55,907( print page 1194)42 U.S.C. 9609(b)
CERCLA
25,000/75,000
53,907/161,721
54,789/164,367
55,907/167,72242 U.S.C. 9609(c)
CERCLA
25,000/75,000
53,907/161,721
54,789/164,367
55,907/167,72242 U.S.C. 11045(a)
EMERGENCY PLANNING AND COMMUNITY RIGHT-TO-KNOW ACT (EPCRA)
25,000
53,907
54,789
55,90742 U.S.C. 11045(b)(1)(A)
EPCRA
25,000
53,907
54,789
55,90742 U.S.C. 11045(b)(2)
EPCRA
25,000/75,000
53,907/161,721
54,789/164,367
55,907/167,72242 U.S.C. 11045(b)(3)
EPCRA
25,000/75,000
53,907/161,721
54,789/164,367
55,907/167,72242 U.S.C. 11045(c)(1)
EPCRA
25,000
53,907
54,789
55,90742 U.S.C. 11045(c)(2)
EPCRA
10,000
21,563
21,916
22,36342 U.S.C. 11045(d)(1)
EPCRA
25,000
53,907
54,789
55,90742 U.S.C. 14304(a)(1)
MERCURY-CONTAINING AND RECHARGEABLE BATTERY MANAGEMENT ACT (BATTERY ACT)
10,000
15,025
15,271
15,58342 U.S.C. 14304(g)
BATTERY ACT
10,000
15,025
15,271
15,5831
                                 Note that 7 U.S.C. 136
                                *l*.(a)(2) contains three separate statutory maximum civil penalty provisions. The first mention of $1,000 and the $500 statutory maximum civil penalty amount were originally enacted in 1978 (Pub. L. 95-396), and the second mention of $1,000 was enacted in 1972 (Pub. L. 92-516).


# Footnotes

1.
    
                         The Federal Civil Penalties Inflation Adjustment Act of 1990, Public Law 101-410, 28 U.S.C. 2461 note, defines “civil monetary penalty” as “any penalty, fine, or other sanction that—(A)(i) is for a specific monetary amount as provided by Federal law; or (ii) has a maximum amount provided for by Federal law; and (B) is assessed or enforced by an agency pursuant to Federal law; and (C) is assessed or enforced pursuant to an administrative proceeding or a civil action in the Federal courts.” Back to Citation
 2.
    
                         The Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015 (Section 701 of Pub.  L.114-74) was signed into law on Nov. 2, 2015, and further amended the Federal Civil Penalties Inflation Adjustment Act of 1990. Back to Citation
 3.
    
                         Under Section 3(2)(A) of the 2015 Act, “civil monetary penalty” means “a specific monetary amount as provided by Federal law”; or “has a maximum amount provided for by Federal law.” EPA-administered statutes generally refer to statutory maximum penalties, with the following exceptions: Section 311(b)(7)(D) of the Clean Water Act, 33 U.S.C. 1321(b)(7)(D), refers to a minimum penalty of “not less than $100,000 . . .”; Section 104B(d)(1) of the Marine Protection, Research, and Sanctuaries Act, 33 U.S.C. 1414b(d)(1), refers to an exact penalty of $600 “[f]or each dry ton (or equivalent) of sewage sludge or industrial waste dumped or transported by the person in violation of this subsection in calendar year 1992 . . .”; and Section 325(d)(1) of the Emergency Planning and Community Right-to-Know Act, 42 U.S.C. 11045(d)(1), refers to an exact civil penalty of $25,000 for each frivolous trade secret claim. Back to Citation
 4.
    
                         Office of Management and Budget Memorandum, 
                        *Implementation of the Penalty Inflation Adjustments for 2018, Pursuant to the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015*
                         (OMB Memorandum M-18-03) at p. 1 (December 15, 2017). Back to Citation
 5.
    
                         
                        *See*
                         OMB Memorandum M-18-03 at p. 4. Back to Citation
 6.
    
                         
                        *See*
                         OMB Memorandum M-18-03 at p. 4. Back to Citation


[FR Doc. 2018-00287 Filed 1-9-18; 8:45 am] BILLING CODE 6560-50-P