Federal Register / Vol. 60, No. 43 / Monday, March 6, 1995 / Rules and Regulations 12139

§ 65.450 Net income.

* * * * *

(d) Except for the allowance for funds

used during construction, reasonable

charitable deductions and interest

related to customer deposits, the

amounts recorded as nonoperating

income and expenses and taxes

(Accounts 7300–7450) and interest and

related items (Accounts 7500–7540) and

extraordinary items (Accounts 7600–

7640) shall not be included unless this

Commission specifically determines

that particular items recorded in those

accounts shall be included.

3. Section 65.820(a) is revised to read

as follows:

§ 65.820 Included items.

(a) Telecommunications Plant. The

interstate portion of all assets

summarized in Account 2001

(Telecommunications Plant in Service)

and Account 2002 (Property Held for

Future Use), net of accumulated

depreciation and amortization, and

Account 2003 (Telecommunications

Plant Under Construction), and, to the

extent such inclusions are allowed by

this Commission, Account 2005

(Telecommunications Plant

Adjustment), net of accumulated

amortization. Any interest cost for funds

used during construction capitalized on

assets recorded in these accounts shall

be computed in accordance with the

procedures in § 32.2000(c)(2)(x) of this

chapter.

[FR Doc. 95–5187 Filed 3–3–95; 8:45 am]

BILLING CODE 6712–01–M

DEPARTMENT OF TRANSPORTATION

Research and Special Programs

Administration

49 CFR Part 107

[Docket No. HM–207D; Amdt. No. 107–33]

RIN 2137–AC60

Hazardous Materials Regulations;

Penalty Guidelines

AGENCY: Research and Special Programs

Administration (RSPA), DOT.

ACTION: Final rule.

SUMMARY: In this final rule, RSPA is

publishing its hazardous material

transportation enforcement civil penalty

guidelines. This action provides the

regulated community and the general

public with guidance as to the factors

RSPA considers in its hazmat penalty

assessment process.

EFFECTIVE DATE: This rule is effective

April 7, 1995.

FOR FURTHER INFORMATION CONTACT: John

J. O’Connell, Jr., Office of Hazardous

Materials Enforcement, (202) 366–4700;

or Edward H. Bonekemper, III, Office of

Chief Counsel, (202) 366–4400,

Research and Special Programs

Administration, U.S. Department of

Transportation, 400 Seventh Street,

SW., Washington, DC 20590–0001.

SUPPLEMENTARY INFORMATION:

I. Background

In response to a request contained in

Senate Report 103–150 that

accompanied the Department of

Transportation and Related Agencies

Appropriations Act, 1994, RSPA is

publishing its hazardous material

transportation (hazmat) enforcement

civil penalty guidelines as an appendix

to its regulations. This action will

provide the regulated community and

the general public with information

concerning how RSPA generally begins

its hazmat penalty assessment process

and types of information that

respondents in enforcement cases

should provide to justify reduction of

proposed penalties.

RSPA enforcement personnel and

attorneys use these guidelines as a

partial means of determining a baseline

civil penalty for selected violations of

the Hazardous Materials Regulations

(HMR; 49 CFR Parts 171–180), or the

Federal hazardous material

transportation law (Federal hazmat law),

49 U.S.C. 5101 et seq. (formerly the

Hazardous Materials Transportation Act

(HMTA), 49 App. U.S.C. 1801 et seq.).

Because these guidelines are nonbinding and are periodically updated,

they are being published as an

informational appendix to the

enforcement regulations, Subpart D of

Part 107 in Title 49 of the Code of

Federal Regulations (CFR). They are

being published without public notice

or comment because they are merely

informational, are not finally

determinative of any issues or rights,

and do not have the force of law.

Because these guidelines are merely a

general statement of agency policy and

practice and because they impose no

requirements, no notice of proposed

rulemaking is necessary.

This rule publishes the guidelines as

they existed on January 18, 1995. In any

particular case, the Office of Hazardous

Materials Enforcement will use the

version of the guidelines in effect at the

time of its referral of a matter to the

Office of the Chief Counsel for possible

issuance of a notice of probable

violation (NOPV). However, since the

guidelines are not legally binding, later

changes in the guidelines may be

considered in a particular case before a

final order is issued.

On November 16, 1990, Congress

amended the HMTA by passing the

Hazardous Materials Transportation

Uniform Safety Act of 1990 (HMTUSA;

Public Law 101–615); in HMTUSA,

Congress increased the maximum

penalties for HMTA and HMR violations

from $10,000 to $25,000 per violation

per day. The guidelines reflect the

culmination of a five-year program

under which RSPA increased the

baseline penalty for most violations by

20 percent per year (on November 16 of

each year between 1990 and 1994) to

effect Congress’ 1990 increase of the

maximum penalty for hazmat violations.

These guidelines are a preliminary

assessment tool used by RSPA

personnel, and they create no rights in

any party. They contain baseline

amounts or ranges for violations that

frequently have been cited in RSPA

hazmat NOPVs. When a violation not

described in the guidelines is

encountered, it sometimes is possible to

determine a baseline penalty by analogy

to a similar violation in the guidelines.

Even when the guidelines are

applicable to a violation, the use of the

guidelines is only a starting point. They

promote consistency and generally are

used to provide some standard for

imposing similar penalties in similar

cases. However, no two cases are

identical, and ritualistic use of the

guidelines would produce arbitrary

results and, most significantly, would

ignore the statutory mandate to consider

several specific assessment criteria.

Therefore, regardless of whether the

guidelines are used to determine a

baseline amount for a violation, RSPA

enforcement and legal personnel must

apply the statutory assessment criteria

to all relevant information in the record

concerning any alleged violation and

the apparent violator. These criteria are

in 49 U.S.C. 5123 and 49 CFR 107.331.

The criteria that RSPA applies are the

nature, extent, circumstances, and

gravity of each violation; the degree of

the violator’s culpability; the violator’s

history of prior violations (if any); the

violator’s ability to pay; any effect of the

penalty on the violator’s ability to

continue to do business, and other

matters that justice requires. The

baseline amount or range is an initial

reflection of the nature, extent,

circumstances, and gravity of the

violation as compared with other types

of violations. This amount then may be

modified on the basis of case-specific

information on nature, extent,

circumstances, and gravity, as well as

information with respect to the other

enumerated factors.
12140 Federal Register / Vol. 60, No. 43 / Monday, March 6, 1995 / Rules and Regulations

Corrective action taken by a violator

to prevent a recurrence of similar

violations is a major consideration

under ‘‘other matters that justice

requires.’’ Application of the statutory

assessment criteria may increase or

decrease the baseline penalty amount or

range. The two economic criteria,

however, are only used to decrease

penalties and are not used to increase

penalties. Conversely, a violator’s

history of prior violations is used only

to increase a penalty.

As discussed more fully below, the

guidelines are not binding on RSPA or

Department of Transportation

personnel. Enforcement personnel and

staff attorneys generally use the

guidelines as a starting point for penalty

assessment. However, they, the Chief

Counsel, administrative law judges

(ALJs), and the RSPA Administrator

may deviate from the guidelines where

appropriate, and are legally bound only

by the statutory assessment criteria.

RSPA is aware of a recent decision by

the United States Court of Appeals for

the District of Columbia Circuit ruling

that a Federal Communications

Commission (FCC) civil penalty

schedule used in its forfeiture

proceedings may not be published as a

policy statement, but must be issued as

a rule in accordance with the public

notice and comment requirements of the

Administrative Procedure Act, 5 U.S.C.

553 (b), (c). United States Telephone

Ass’n v. FCC, 28 F.3d 1232 (D.C. Cir.

1994). RSPA has reviewed the Court’s

decision, as well as the FCC schedule

and procedures that were the subject of

the ruling, and believes that the ruling

is not applicable to the RSPA

guidelines.

A respondent has no right to be heard

in an FCC forfeiture proceeding other

than by the FCC Bureau that initiates

the forfeiture action. The Bureau begins

a proceeding by issuing a forfeiture

order. 47 CFR 1.80(f). The respondent is

permitted a written reply, and the

Bureau issues a final administrative

determination. Id. A hearing before an

ALJ may be held, but solely at the

Bureau’s discretion, 47 CFR 1.80(g); the

regulations themselves state that

normally the matter will be heard by an

ALJ only when it arises in conjunction

with other proceedings for which a

formal hearing is required, id. When a

hearing is held, the decision of the ALJ

is subject to Bureau review and

approval. 47 CFR 1.273, 1.282. The FCC

schedule governs the Bureau’s penalty

determination, whether following a

respondent’s written reply or in

reviewing an ALJ decision. Thus, a

respondent, even where it fully

exercised its procedural rights, would

be assessed a penalty determined

according to a methodology that it had

no opportunity to contest. It is firmly

established that a standard must be

issued as a rule if it is ‘‘finally

determinative’’ of a respondent’s

obligations. E.g., Brock v. Cathedral

Bluffs Shale Oil Co., 796 F.2d 533, 537

(D.C. Cir. 1986).

In contrast, the RSPA guidelines are

used by the RSPA Office of the

Associate Administrator for Hazardous

Materials Safety (OHMS), at a staff, level

to assist in developing recommended

proposed penalties in enforcement

cases. On receiving an NOPV setting

forth the penalty, a respondent may

demand a formal hearing before an ALJ.

49 CFR 107.319. The OHMS and RSPA’s

Office of Chief Counsel will employ the

guidelines to determine the penalty for

which it will argue before the ALJ;

nonetheless, the ALJ is not bound by the

guidelines, and retains his or her

essential discretion.

An ALJ decision that is not appealed

is a final administrative action. 49 CFR

107.323. A decision that is appealed is

reviewed by the RSPA Administrator.

49 CFR 107.325. On review of an ALJ

decision, the Administrator, as well, is

not bound by the OHMS guidelines.

Accordingly, the guidelines do not

‘‘finally determin[e]’’ a respondent’s

penalty obligation; a respondent that

objects to the proposed penalty has the

right to contest the penalty fully before

the administrative decisionmaker. The

administrative decisionmaker remains

‘‘free to exercise his [or her] informed

discretion.’’ Guardian Fed. Savings &

Loan Ass’n v. Federal Savings & Loan

Ins. Corp., 589 F.2d 658, 666, 668 (D.C.

Cir. 1978).

In addition, the FCC schedule and the

RSPA guidelines differ significantly in

the degree to which they permit

deviation in their use. The USTA court,

citing the proposition that the policy/

rule distinction turns on ‘‘an agency’s

intention to bind itself to a particular

legal policy position,’’ 28 F.3d 1234,

found that in over 300 cases, the FCC

followed its fine schedule essentially

without exception, id. at 1234–35.

The OHMS guidelines, as opposed to

a penalty schedule, consist of a listing

of violations and the baseline penalty,

or range of penalties, proposed for each

as of November 16, 1994, as well as an

explanation of the methodology OHMS

generally uses to modify the baseline

proposed penalty on the basis of casespecific factors required to be

considered under 49 U.S.C. 5123(c) and

49 CFR 107.331. The guidelines

presuppose flexibility in their

application; beyond that, the OHMS or,

where respondent has waived formal

hearing, the order of the Chief Counsel

imposing a penalty, often has gone

beyond the boundaries of the guidelines

as warranted by particular evidence

from or arguments of a respondent.

RSPA expects to publish revised

guidelines annually.

II. Rulemaking Analyses and Notices

Executive Order 12866 and DOT

Regulatory Policies and Procedures

This final rule is not considered a

significant regulatory action under

section 3(f) of Executive Order 12866

and, therefore, was not subject to review

by the Office of Management and

Budget. This rule is not significant

under the Regulatory Policies and

Procedures of the Department of

Transportation (44 FR 11034). The

economic impact of this final rule is

minimal to the extent that preparation

of a regulatory evaluation is not

warranted.

Executive Order 12612

This final rule has been analyzed in

accordance with the principles and

criteria contained in Executive Order

12612 (‘‘Federalism’’). The Federal

hazardous materials transportation law

contains an express preemption

provision (49 U.S.C. 5125(b)(1)) that

preempts State, local, and Indian tribe

requirements on certain covered

subjects unless they are ‘‘substantively

the same’’ as the HMR. Covered subjects

are:

(i) The designation, description, and

classification of hazardous materials;

(ii) The packing, repacking, handling,

labeling, marking, and placarding of

hazardous materials;

(iii) The preparation, execution, and

use of shipping documents pertaining to

hazardous materials and requirements

respecting the number, content, and

placement of such documents;

(iv) The written notification,

recording, and reporting of the

unintentional release in transportation

of hazardous materials; or

(v) The design, manufacturing,

fabrication, marking, maintenance,

reconditioning, repairing, or testing of a

package or container which is

represented, marked, certified, or sold

as qualified for use in the transportation

of hazardous materials. The Federal

hazardous materials transportation law

(49 U.S.C. 5125(b)(2)), as amended,

provides that if DOT issues a regulation

concerning any of the covered subjects

after November 16, 1990, DOT must

determine and publish in the Federal

Register the effective date of Federal

preemption. The effective date may not

be earlier than the 90th day following
Federal Register / Vol. 60, No. 43 / Monday, March 6, 1995 / Rules and Regulations 12141

the date of issuance of the final rule and

not later than two years after the date of

issuance. This final rule is an

informational appendix and imposes no

requirements. Thus, preparation of a

federalism assessment is not warranted.

Regulatory Flexibility Act

I certify that this final rule will not

have a significant economic impact on

a substantial number of small entities.

This rule applies to shippers and

carriers of hazardous materials, some of

which are small entities; however, there

is no economic impact.

Paperwork Reduction Act

There are no new information

requirements in this final rule.

List of Subjects in 49 CFR Part 107

Administrative practices and

procedure, Hazardous materials

transportation, Packaging and

containers, Penalties, Reporting and

recordkeeping requirements.

In consideration of the foregoing, 49

CFR part 107 is amended as follows:

PART 107—HAZARDOUS MATERIALS

PROGRAM PROCEDURES

1. The authority citation for part 107

continues to read as follows:

Authority: 49 U.S.C. 5101–5127, 44701; 49

CFR 1.45 and 1.53.

2. Appendix A is added to subpart D

of part 107 to read as follows:

Appendix A to Subpart D of Part 107—

Guidelines for Civil Penalties

I. This appendix sets forth the guidelines

used by the Office of Hazardous Materials

Safety (as of January 18, 1995) in making

initial baseline determinations for

recommending civil penalties. The first part

of these guidelines is a list of baseline

amounts or ranges for probable violations

frequently cited in enforcement reports

referred for action. Following the list of

violations are general guidelines used by

OHMS in making initial penalty

determinations in enforcement cases.

II. List of Frequently Cited Violations

Violation description Section or cite Baseline

assessment

Part 107—Requirements

Failure to register as a carrier or shipper of hazardous material ............................................. 107.608 .................................. $1,500

Part 171—Requirements

Failure to inform foreign shipper and U.S. forwarding agent of 49 CFR requirements applying to a shipment within the U.S.171.12(a) ................................ 7,200

Failure to file a DOT 5800.1 Hazardous Materials Incident Report within 30 days following

an unintentional release of hazardous materials in transportation.

171.16 .................................... 3,100

Part 172—Requirements

Shipping Papers (§§ 172.200–172.205):

Failure to execute a shipping paper for a shipment of hazardous materials .................... 172.201 .................................. 5,200

Failure to follow one or more of the three approved formats for listing hazardous materials on a shipping paper.172.201(a)(1) .......................... 1,200

Failure to include a proper shipping name in the proper shipping description ................. 172.202 .................................. 1,850

Failure to included a hazard class/division number in the proper shipping description .... 172.202 .................................. 1,850

Failure to include the identification number in the proper shipping description ................ 172.202 .................................. 1,200

Using an incorrect identification number in the proper shipping description ..................... 172.202 .................................. 1,850

Using an incorrect identification number in the proper shipping description, that

changes the required response information.

172.202 .................................. 2,500

Using a shipping description that is mostly correct, but includes extra or incorrect words 172.202 .................................. 1,000

Using a shipping description that includes additional unauthorized information ............... 172.202 .................................. 850

Using a proper shipping description not in required sequence ......................................... 172.202 .................................. 500

Using a shipping description that is missing two required elements ................................. 172.202 .................................. 3,100

Using a shipping description where more than two required elements are missing ......... 172.202 .................................. 4,300

Using a shipping name and hazard class that is incorrect, such that the material is

misdescribed.

172.202 .................................. 3,700

Using a shipping name and hazard class that is incorrect, such that a material is

misclassified.

172.202 .................................. 6,200

Failure to include the total quantity of hazardous material covered by a shipping description.172.202(c) .............................. 430

The letters ‘‘RQ’’ are not used in the shipping description to identify materials that are

hazardous substances.

172.203(c)(2) .......................... 500

Failure to include a required technical name in parentheses for a listed generic or

‘‘n.o.s.’’ material.

172.203(k) .............................. 1,200

Failure to list an exemption number as part of the required shipping description ............ 172.203(a) .............................. 1,200

Failure to include the required shipper’s certification on a shipping paper ....................... 172.204(a) .............................. 1,800

Failure to execute the required shipper’s certification on a shipping paper ...................... 172.204 .................................. 1,000

Emergency Response Information Requirements (§§ 172.600–172.604):

Providing or listing incorrect emergency response information with or on a shipping

paper (if significant difference in response).

172.602 .................................. 2,600

Providing or listing incorrect emergency response information with or on a shipping

paper (if no significant difference in response).

172.602 .................................. 1,300

Failure to include an emergency response telephone number on a shipping paper ........ 172.604 .................................. 2,600

Failure to have the emergency response telephone number monitored while a hazardous material is in transportation.172.604 .................................. 1,300

Listing a fraudulent emergency response telephone number on a shipping paper .......... 172.604 .................................. 3,700
12142 Federal Register / Vol. 60, No. 43 / Monday, March 6, 1995 / Rules and Regulations

Violation description Section or cite Baseline

assessment

Listing an emergency response telephone number on a shipping paper that is not

working or is incorrect.

172.604 .................................. 1,300

Failure to provide required technical information when the listed emergency response

telephone number is contacted.

172.604 .................................. 2,600

Package Marking Requirements (§§ 172.300–172.338):

Failure to mark the required identification number on a package ..................................... 172.301(a) .............................. 1,200

Marking an incorrect identification number on a package ................................................. 172.301(a) .............................. 1,850

Marking an incorrect identification number on a package that changes the appropriate

emergency response information.

172.301(a) .............................. 2,500

Failure to mark the required shipping name on a package ............................................... 172.301(a) .............................. 2,500

Failure to mark the required shipping name and identification number on a package ..... 172.301(a) .............................. 4,200

Marking a package with an incorrect shipping name and identification number ............... 172.301(a) .............................. 5,000

Marking a package with an incorrect shipping name and identification number that does

not affect emergency response information/actions.

172.301(a) .............................. 2,500

Failure to include the required technical name(s) in parentheses for a listed generic or

‘‘n.o.s.’’ entry.

172.301(c) .............................. 1,200

Failure to mark a package containing liquid hazardous materials with required orientation marks.172.312 .................................. 3,700

Failure to mark a package containing liquid hazardous materials with required orientation marks, when inside packagings have vented closures.172.312 .................................. 4,200

Package Labeling Requirements (§§ 172.400–172.450):

Failure to label a package, when required ......................................................................... N/A ......................................... 4,300

Placing a label in a package when the label represents a hazard other than the actual

hazard presented by the hazardous material in the package.

N/A ......................................... 5,000

Placing a label not conforming to size requirements on a package .................................. N/A ......................................... 1,000

Placing a label on a package that does not contain a hazardous material ...................... 172.401(a) .............................. 1,300

Placing a label that does not meet color specification requirements on a package ......... N/A ......................................... 600 to 2,500

Failure to place a required subsidiary label on a package, when required ....................... N/A ......................................... 2,500

Failure to provide an appropriate division number on an explosive label ......................... N/A ......................................... 5,200

Placarding Requirements (§§ 172.500–172.560):

Failure to placard a freight container containing hazardous materials .............................. N/A ......................................... 500 to 7,500

Failure to properly placard a freight container containing Division 1.1, 1.2, or 1.3 (Class

A or B) explosives.

172.504 .................................. 8,650

Training Requirements (§§ 172.700–172.704):

Failure to train hazmat employees in the three required areas ......................................... 172.702 .................................. 1,500 to 25,000

Failure to train hazmat employees in one of the three required areas ............................. 172.702 .................................. 500 and up

Failure to train hazmat employees in two of the three required areas .............................. 172.702 .................................. 1,000 and up

Failure to maintain training records .................................................................................... 172.702 .................................. 500 and up

Part 173—Requirements

Overpack Requirements (§ 173.25):

Failure to mark an overpack with a statement indicating that the inside packages comply with prescribed specifications when specification packaging is required.173.25(a)(4) ............................ 3,100

Reconditioner Requirements (§ 173.28):

Representing, marking, or certifying a drum as a reconditioned DOT packaging, when

the drum did not meet a DOT specification.

173.28(m)(3)(ii) 1 .................... 5,200 to 7,200

Marking an incorrect registration number on a reconditioned packaging .......................... 173.28(m)(3)(ii) 1 .................... 1,550

Failure to properly conduct alternate leakage test ............................................................. 173.28(m)(2) 1 ........................ 5,000

Representing, marking, or certifying a drum as altered from one specification to another, when the drum had not actually been altered.173.28(o)(1) 1 ......................... 1,000

IM Portable Tank Requirements (§ 173.32c):

Offering a hazardous material for transportation in an IM portable tank equipped with

bottom outlets, when the material contained is prohibited from being offered in this

type of packaging.

173.32c(a) .............................. 5,200 to 7,200

Offering an IM portable tank for transportation that has not been visually inspected

within last 21⁄2 years per 173.32b(b).

173.32c(c) .............................. 5,000

Offering an IM portable tank for transportation that has not been hydrostatically retested in last five years per 173.32b(a).173.32c(c) .............................. 6,200

Offering an IM portable tank for transportation that has not been visually or

hydrostatically tested as required, or failing to remove the safety relief valves during

testing.

173.32c(c) .............................. 12,500

Failure to provide the required outage for a shipment of hazardous materials, that results in the release of hazardous materials.173.32c(k) .............................. 15,500

Cylinder Retesters (§§ 173.23, 173.34, and 173.302):

Failure to remark an aluminum exemption cylinder as a DOT 3 AL ................................. 173.23(c) ................................ 2,100

Certifying or marking as retested a nonspecification cylinder ........................................... 173.34 .................................... 5,200 to 7,200

Marking a cylinder in or on the sidewall area when not permitted by the applicable

specification.

173.34(c)(1) ............................ 8,650

Failure to maintain legible markings on a cylinder ............................................................ 173.34(e) ................................ 1,200

Failure to perform hydrostatic retesting at the minimum of 5/3 times the service pressure, or at the minimum specified test pressure.173.34(e) ................................ 2,100 to 5,200

Failure to perform visual external examination .................................................................. 173.34(e)(1) ............................ 3,100
Federal Register / Vol. 60, No. 43 / Monday, March 6, 1995 / Rules and Regulations 12143

Violation description Section or cite Baseline

assessment

Failure to perform visual internal examination ................................................................... 173.34(e)(1) ............................ 3,600

Failure to perform both visual external and visual internal examinations ......................... 173.34(e)(1) ............................ 4,200

Inability to conduct a complete visual examination due to: excess paint build-up on a

cylinder; failure to remove banding; failure to remove a permanent attachment; or

failure to remove a plastic attachment that has torn or cracked.

173.34(e)(1) ............................ 3,100

Failure to have a retester’s identification number (RIN) .................................................... 173.34(e)(1)(i) ........................ 3,600

Failure to have current authority due to failure to renew a retester’s identification number.173.34)e)(1)(i) ........................ 2,500

Failure to have a retester’s identification number and marking another RIN on a cylinder.173.34(e)(1)(i) ........................ 7,200

Marking a RIN before successfully completing a hydrostatic retest. ................................. 173.34(e)(1)(ii) ........................ 3,100

Marking a cylinder as having been retested without performing retest ............................. 173.34(e)(1)(ii) ........................ 8,650

Performing hydrostatic retesting without demonstrating the accuracy of the testing

equipment.

173.34(e)(3) ............................ 2,100 to 5,200

Failure to hold hydrostatic test pressure for 30 seconds or sufficiently longer to allow

for complete expansion.

173.34(e)(3) ............................ 3,100

Failure to perform a second retest, after equipment failure, at a pressure of 10% more

or 100 psi more, whichever is less.

173.34(e)(3) ............................ 3,100

Exceeding 90% of test pressure prior to conducting test .................................................. 173.34(e)(3) ............................ 850

Failure to condemn a cylinder with permanent expansion of 10% or greater (5% for

certain exemption cylinders); failure to condemn cylinders with evidence of internal or

external corrosion, denting, bulging, or rough usage.

173.34(e)(4) ............................ 6,000

Marking an FRP cylinder with steel stamps in the FRP area of the cylinder such that

the integrity of the cylinder is compromised.

Applicable Exemption ............. 8,650

Failure to keep records of cylinder reinspection and retest ............................................... 173.34(e)(5) ............................ 4,200

Failure to keep accurate records of cylinder reinspection and retest ................................ 173.34(e)(5) ............................ 1,000 to 3,100

Improper marking of the RIN or retest date on a cylinder ................................................. 173.34(e)5) ............................. 1,550

Marking a DOT 3HT cylinder with a steel stamp other than a low-stress steel stamp ..... 173.34(e)(13)(iv) ..................... 5,200 and up

Marking a ‘‘+’’ sign on a cylinder without determining the average or maximum wall

stress.

173.302(c)(3) .......................... 3,000 to 4,300

Representing, marking, or certifying a cylinder as meeting the requirements of an exemption, when the cylinder was not maintained or retested in accordance with the

exemption.

N/A ......................................... 4,300 to 6,000

Rebuilder Requirements (§ 173.34):

Representing a DOT–4 series cylinder as meeting the requirements of the Hazardous

Materials Regulations without being authorized to do so by the Associate Administrator for Hazardous Materials Safety.

173.34(l) ................................. 7,200

Part 178—Requirements

Third-Party Packaging Certifiers (General):

With testing completed, TPPC’s certification directs manufacturer to improperly mark a

packaging (e.g., steel drum to be marked UN 4G).

N/A ......................................... 2,100

Manufacturers (General):

Failure to conduct drop testing from required distance ..................................................... N/A ......................................... 4,200

Manufacturing, marking, certifying, or selling a package marked to a specification, UN

standard, or an exemption when applicable requirements are not met.

N/A ......................................... 5,200 to 8,650

Certifying a packaging as meeting a UN standard when design qualification testing was

not performed.

N/A ......................................... 6,000 to 10,800

Failure to conduct periodic testing on UN standard packaging ......................................... N/A ......................................... 5,000 to 8,650

Failure to properly conduct design qualification or periodic retesting for UN standard

packaging.

N/A ......................................... 4,200

Marking, or causing the marking of, a packaging with the symbol of a manufacturer or

packaging certifier other than the company that actually manufactured or certified the

packaging.

N/A ......................................... 7,200

Failure to keep and maintain records of design qualification testing ................................ 178.601(k)(1) .......................... 4,200

Failure to keep and maintain records of periodic retest .................................................... 178.601(k)(2) .......................... 4,200

Manufacturing DOT specification packaging after October 1, 1994 .................................. N/A ......................................... 3,000 and up

Manufacturer Requirements—Fiberboard Boxes:

Manufacturing, marking, certifying, or selling a package marked to a specification, UN

standard, or an exemption when applicable requirements are not met.

N/A ......................................... 4,300 to 7,200

Certifying packaging as meeting UN 4G standard when it was not properly conditioned

before design qualification testing.

N/A ......................................... 4,300

Failure to properly mark a fiberboard box .......................................................................... N/A ......................................... 1,200

Manufacturing Requirements—UN 1H1 Drums:

Failure to properly conduct alternate leakproofness test ................................................... N/A ......................................... 4,200

Manufacturing Requirements—DOT High-Pressure Cylinders:

Manufacturing, representing, marking, certifying, or selling a DOT high-pressure cylinder that was not inspected and verified by an approved independent inspection

agency.

N/A ......................................... 6,000 to 10,800

Manufacturing Requirements—Spec. DOT 39 Cylinders:

Failure to have a registration number/failure to mark it on the cylinder ............................ N/A ......................................... 3,700

Marking another company’s number on a cylinder ............................................................ N/A ......................................... 5,000
12144 Federal Register / Vol. 60, No. 43 / Monday, March 6, 1995 / Rules and Regulations

Violation description Section or cite Baseline

assessment

Failure to mark the date of manufacture or lot number on a cylinder ............................... N/A ......................................... 3,100

Failure to have a chemical analysis performed in the U.S. for a material manufactured

outside the U.S./failure to obtain a chemical analysis from the foreign manufacturer.

N/A ......................................... 5,000

Failure to conduct a complete visual internal examination ................................................ N/A ......................................... 3,500 to 5,200

Failure to conduct a flattening test ..................................................................................... N/A ......................................... 5,200

Failure to conduct a burst test ........................................................................................... N/A ......................................... 5,200

Failure to properly conduct required test. .......................................................................... N/A ......................................... 4,200

Failure to maintain a required inspector’s report ............................................................... N/A ......................................... 5,200

Failure to maintain an accurate inspector’s report ............................................................. N/A ......................................... 1,200 to 3,700

Manufacturing Requirements—DOT 4B Cylinders:

Failure to conduct a hydrostatic test by water jacket method on one cylinder out of

each lot of 200 or less.

178.50–14 .............................. 5,200

Failure to conduct a flattening test ..................................................................................... 178.50–15 .............................. 5,200

Failure to conduct physical testing ..................................................................................... 178.50–16 .............................. 5,200

Failure to properly conduct required test ........................................................................... N/A ......................................... 4,200

Failure to maintain the required Inspector’s report ............................................................ N/A ......................................... 5,200

Failure to maintain an accurate Inspector’s report ............................................................ N/A ......................................... 1,200 to 3,700

Manufacturing Requirements—Steel Drums:

Failure to pass testing conducted in plant ......................................................................... N/A ......................................... 5,200 and up

Failure to properly conduct ‘‘solution over partial seams’’ test .......................................... N/A ......................................... 3,500 to 5,000

Failure to retain chime cuts when conducting ‘‘solution over partial seams’’ testing ........ N/A ......................................... 3,100

Other Requirements

Offeror Requirements (General):

Offering a hazardous material for transportation in an unauthorized, nonspecification, or

nonstandard packaging.

N/A ......................................... 5,200 to 8,650

Offering a hazardous material for transportation in an unauthorized, nonstandard, or

nonspecification inner package.

N/A ......................................... 4,300

Offering a hazardous material for transportation in a packaging that leaks during conditions normally incident to transportation.N/A ......................................... 10,400

Offering a hazardous material for transportation that is covered by an exemption, without complying with its terms.N/A ......................................... 5,200 to 8,650

Offering a hazardous material for transportation in a packaging marked as manufactured to a DOT specification where that packaging was manufactured after October

1, 1994.

171.14 .................................... 3,000 and up

Offeror requirements (Class 1 (Explosives)):

Failing to mark the ‘‘EX’’ approval number on a package containing an explosive .......... 172.320 .................................. 1,200

Offering an unapproved explosive for transportation ......................................................... 173.54(a) and 173.56(b) ........ 10,000 to 25,000

Offering a leaking or damaged package of explosives for transportation ......................... 173.54(c) ................................ 10,000 to 25,000

Offering a Division 1.3 (Class B) explosive for transportation that is misclassified as Division 1.4 (Class C) explosive.N/A ......................................... 8,400 and up

Offeror Requirements (Class 3 (Flammable Liquid)):

Using an incorrect marking for the flashpoint in order to be excepted from specification

packaging, for a flammable liquid with a flash point of 73° Fahrenheit or higher.

173.118(b) 1 ............................ 1,000

Offering a flammable liquid with a flash point below 20° Fahrenheit for transportation in

an unauthorized DOT 17E drum (20/18-gauge v. 18-gauge).

173.119(a)(3) 1 ....................... 6,200

Offering a flammable liquid with a flash point of 73° Fahrenheit or above in

nonspecification packaging, without marking the flash point or an indication that it

was at or above 73° Fahrenheit on the packaging.

N/A ......................................... 3,600 to 5,200

Offeror Requirements (Division 6.1 (Poisonous Liquids)):

Offering a poisonous liquid for transportation in a DOT 12A fiberboard box that was

tested as required by § 178.210–10.

173.346(a)(26) 1 ..................... 5,200

Offeror Requirements (Class 7 (Radioactive Materials)):

Failure to have a valid U.S. NRC approval certificate authorizing the use of a packaging as Type B (never having obtained one).173.415(c) .............................. 4,300

Failure to have a valid U.S. NRC approval certificate authorizing the use of a packaging as Type B (previously had one, but now expired).173.415(c) .............................. 3,500 and up

Offeror Requirements (Portable or IM Tanks):

Offering a hazardous material for transportation in a DOT 57 or exemption portable

tank that is out of test.

173.32(e)(1)(ii) ........................ 6,200

Offering a compressed gas for transportation in a DOT 51 portable tank that is out of

test (may be higher if offeror is also owner and portable tank has not been tested at

all, or not for a long time).

173.32(e)(l)(i) 173.315(a) ....... 5,200 to 8,650

Offeror Requirements (Cylinders):

Offering a compressed gas for transportation in a cylinder that is out of test (may be

higher if offeror is also owner and cylinder has not been retested at all, or not for a

long time.

173.301(c) .............................. 5,200 to 8,650

Failure to check each day the pressure of a cylinder charged with acetylene that is representative of that day’s compression, after the cylinder has cooled to a settled temperature, or failure to keep a record of this test for at least 30 days.173.303(d) .............................. 4,200
Federal Register / Vol. 60, No. 43 / Monday, March 6, 1995 / Rules and Regulations 12145

Violation description Section or cite Baseline

assessment

Offering a mixture of a non-hazardous material and a compressed gas as an ORM–D

without properly determining the internal pressure at equilibrium in a water bath heated to 130° Fahrenheit.

173.1200(a)(ii)(E) ................... 6,200

Carrier Requirements:

Transporting railway track torpedoes outside of flagging kits, in violation of E–7991 ...... N/A ......................................... 6,000

Transporting explosives in a motor vehicle containing metal or other articles or materials likely to damage such explosives or any package in which they are contained,

without segregating in different parts of the load or securing them in place in or on

the motor vehicle and separated by bulkheads or other suitable means to prevent

such damage.

177.835(i) ............................... 5,200

Exemptions:

Requested renewal of an exemption prior to expiration, but shipped after expiration ...... N/A ......................................... 2,500

Offered or transported a packaging or otherwise performed a function covered by an

exemption after an exemption had expired (less than one year).

N/A ......................................... 2,900

Offered or transported a packaging or otherwise performed a function covered by an

exemption after an exemption had expired (more than one year).

N/A ......................................... 3,600 to 7,200

1 Cite refers to provisions in effect September 30, 1991 (see 49 CFR Part 173, revised as of October 1, 1990).

III. Consideration of Statutory Criteria

A. These guidelines are used by the Office

of Hazardous Materials Safety (OHMS) in

setting initial proposed penalties for hazmat

violations. They indicate baseline amounts or

ranges for probable violations frequently

cited in enforcement reports and set forth

general OHMS policy for considering

statutory criteria.

B. The initial baseline determination

partially considers the nature, extent,

circumstances, and gravity of the alleged

violation. That determination then is

adjusted to consider all other evidence

concerning the nature, extent, circumstances,

and gravity of the alleged violation; degree of

culpability; history of prior violations; ability

to pay; effect of the penalty on ability to

continue to do business; and such other

matters as justice may require (a major

component of which is corrective action

taken by a respondent to prevent a recurrence

of similar violations). In making a penalty

recommendation, the baseline or range may

be increased or decreased on the basis of

evidence pertaining to these factors.

C. The following miscellaneous factors are

used to implement one or more of the

statutory assessment criteria.

IV. Miscellaneous Factors Affecting Penalty

Amounts

A. Corrective Action

1. A proposed penalty is mitigated for

documented corrective action of alleged

violations taken by a respondent. Corrective

action may occur: (1) After an inspection and

before a Notice of Probable Violation (NOPV)

is issued; (2) on receipt of an NOPV; or (3)

after receipt of an NOPV (possibly after it is

solicited by an RSPA attorney). In general,

corrective action may reduce a penalty up to

25%. Mitigation may be taken into account

in the referral memo or may be recommended

prior to issuance of an Order by RSPA’s Chief

Counsel.

2. The two primary factors in determining

the penalty reduction are extent and timing

of the corrective action. In other words,

mitigation will be determined on the basis of

how much corrective action was taken and

when it was taken. Systemic action to

prevent future violations is given greater

consideration than action simply to remedy

violations identified during the inspection.

3. Mitigation is applied to individual

violations. Thus, in a case with two

violations, if corrective action for the first

violation is more extensive than for the

second, the penalty for the first will be

mitigated more than that for the second.

B. Respondents That Re-Ship

A shipper that reships materials received

from another company, in the same

packaging and without opening or altering

the package, independently is responsible for

ensuring that the shipment complies with

Federal hazmat law, and independently may

be subject to enforcement action if the

package does not comply. Nevertheless, the

reshipper is considered to have a lesser level

of responsibility for compliance in those

respects in which it reasonably relies on the

compliance of the package as received. In

most cases of this type, OHMS will discount

the applicable baseline standard by about

25%. The specific knowledge and expertise

of all parties must be considered in

discounting for reliance on a prior shipper.

This discount is applied before any

consideration of mitigation based on

corrective action.

C. Penalty Increases for Multiple Counts

Under the Federal hazmat law, 49 U.S.C.

5213(a), each violation of the HMR and each

day of a continuing violation (except for

violations pertaining to packaging

manufacture or qualification) is subject to a

civil penalty of up to $25,000. Absent

aggravating factors, OHMS, in its exercise of

discretion, ordinarily will apply a single

penalty for multiple counts or days of

violation. In a number of cases, particularly

those involving shippers, an inspector may

cite two or more similar packaging violations

for different hazardous materials. For

example, the inspector may cite the same

marking violation for two or more packages.

OHMS usually will consider those additional

violations as counts of the same violation and

will not recommend multiples of the same

baseline penalty. Rather, OHMS usually will

recommend the baseline penalty for a single

violation, increased by 25% for each

additional violation.

D. Financial Considerations

1. Mitigation is appropriate when the

baseline penalty would (1) exceed an amount

that the respondent is able to pay, or (2) have

an adverse effect on the respondent’s ability

to continue in business. These criteria relate

to a respondent’s entire business, and not just

the product line or part of its operations

involved in the violation(s). Beyond the

overall financial size of the respondent’s

business, the relevant items of information

on a respondent’s balance sheet include the

current ratio (current assets to current

liabilities), the nature of current assets, and

net worth (total assets minus total liabilities).

2. These figures are considered on a caseby-case basis. In general, however, a current

ratio close to or below 1.0 means that the

company may have difficulty in paying a

large penalty, and may justify reduction of

the penalty or an installment payment plan.

A small amount of cash on hand representing

limited liquidity, even with substantial other

current assets (such as accounts receivable or

inventory), may warrant a short-term

payment plan. Respondent’s income

statement also will be reviewed to determine

whether a payment plan is appropriate.

3. Many companies are able to continue in

business for extended periods of time with a

small or negative net worth, and many

respondents have paid substantial civil

penalties in installments even though net

worth was negative. For this reason, negative

net worth alone does not always warrant

reduction of a proposed penalty or even, in

the absence of factors discussed above, a

payment plan.

4. In general, an installment payment plan

may be justified where reduction of a

proposed penalty is not, but the

appropriateness of either (or both) will

depend on the circumstances of the case. The

length of a payment plan should be as short

as possible, but the plan may consider

seasonal fluctuations in a company’s income

if the company’s business is seasonal (e.g.,

swimming pool chemical sales, fireworks

sales) or if the company has documented

specific reasons for current non-liquidity.

5. Evidence of financial condition is used

only to decrease a penalty, and not to

increase it.
12146 Federal Register / Vol. 60, No. 43 / Monday, March 6, 1995 / Rules and Regulations

E. Penalty Increases for Prior Violations

1. The baseline penalty presumes an

absence of prior violations. If prior violations

exist, generally they will serve to increase a

proposed penalty. The general standard for

increasing a baseline proposed penalty on the

basis of prior violations is as follows:

a. One prior case—25% increase over the premitigation recommended penalty

b. Two prior cases—50% increase over the

pre-mitigation recommended penalty

c. Three prior cases—75% increase over the

pre-mitigation recommended penalty

d. Four or more prior cases—100% increase

over the pre-mitigation recommended

penalty

2. A case of prior violations closed more

than five years previously normally will not

be considered in determining a proposed

penalty.

F. Penalty Increases for Use of Expired

Exemptions

Adjustments to the base line figures for use

of expired exemptions can be made

depending on how much material has been

shipped during the period between the

expiration date and the renewal date. If the

company previously has been found to have

operated under an expired exemption, the

penalty is normally doubled. If the company

has been previously cited for other

violations, the penalty generally will be

increased by about 25%.

Issued in Washington, DC on February 27,

1995 under authority delegated in 49 CFR

part 1.

Ana Sol Gutı ́errez,

Deputy Administrator, Research and Special

Programs Administration.

[FR Doc. 95–5179 Filed 3–3–95; 8:45 am]

BILLING CODE 4910–60–P

Federal Highway Administration

49 CFR Part 393

[FHWA Docket No. MC–94–28]

Parts and Accessories Necessary for

Safe Operation; Glazing and Window

Construction; Petition for Waiver To

Permit Use of Automatic Vehicle

Identification Transponder

AGENCY: Federal Highway

Administration (FHWA), DOT.

ACTION: Grant of petition for waiver.

SUMMARY: The FHWA is granting a

petition from the Commonwealth of

Kentucky, lead State for the

ADVANTAGE I–75 Program, and Heavy

Vehicle Electronic License Plate, Inc.,

(HELP) requesting a waiver from the

requirements of the Federal Motor

Carrier Safety Regulations (FMCSRs) to

allow mounting of an automatic vehicle

identification (AVI) transponder near

the upper border at the approximate

center of the windshields of commercial

motor vehicles.

The FHWA is granting the waiver to

permit the use of the transponders in

commercial motor vehicles participating

in the ADVANTAGE I–75 operational

(‘‘beta’’) test and the HELP corridor

programs, subject to the conditions

imposed in this notice.

EFFECTIVE DATE: April 5, 1995.

FOR FURTHER INFORMATION CONTACT: Ms.

Deborah M. Freund, Office of Motor

Carrier Standards, (202) 366–2981, or

Mr. Charles Medalen, Office of the Chief

Counsel, (202) 366–1354, Federal

Highway Administration, Department of

Transportation, 400 Seventh Street SW.,

Washington, D.C. 20590. Office hours

are from 7:45 a.m. to 4:15 p.m., e.t.,

Monday through Friday, except Federal

holidays.

SUPPLEMENTARY INFORMATION:

Background

On October 12, 1994, the FHWA

published a notice in the Federal

Register (59 FR 51540) requesting

comments on petitions received from

the Commonwealth of Kentucky

(Kentucky) and HELP. The petitioners

are the lead organizations in multi-State

partnerships of public and private sector

interests conducting a series of

operational tests that fall within the

Commercial Vehicle Operations (CVO)

element of the Intelligent Transportation

System (ITS) Program (formerly known

as the Intelligent Vehicle-Highway

Systems (IVHS) program). The

ADVANTAGE I–75 and HELP programs

were created to allow commercial motor

vehicles (CMVs) that are equipped with

transponders and that comply with

safety and administrative requirements

to travel any segment of their respective

instrumented highways at mainline

speeds with minimal stopping at

weight/inspection checkpoints.

The AVI device proposed for use in

both programs is an electronic

transponder designed to send and

receive signals from a CMV to ports of

entry (POEs) and safety inspection sites.

The devices would be used to transmit

a variety of information, such as the

identity of the motor carrier, the gross

weight of the vehicle, and the status of

the vehicle’s registration and fuel tax

payments. The transponder measures 84

mm (3.3 inches) high by 112 mm (4.4

inches) wide by 38 mm (1.5 inches)

deep.

In order to function effectively, the

transponder must be able to properly

transmit and receive signals from

roadside receivers installed at States’

ports of entry. The physical location of

the transponder is a critical factor in its

operation because of the potential for

internal and external electronic

interference. In addition, the device

must be placed in a suitable location to

allow drivers to read the instruction

displayed on the transponder, i.e., to

enter or to bypass the POE. An

engineering evaluation performed by

one of the ADVANTAGE I–75 electronic

equipment contractors determined that

a location near the center of the upper

border of the windshield best allowed

the device to meet both of these

requirements.

However, 49 CFR 393.60(c) requires

that no motor vehicle be operated with

any label, sticker, decalcomania, or

other vision-reducing matter covering

any portion of its windshield or

windows at either side of the driver’s

compartment, except that stickers

required by law may be affixed to the

bottom of the windshield, provided that

no portion of any label, sticker,

decalcomania, or other vision-reducing

matter may extend upward more than

114 mm (4.5 inches) from the bottom of

the windshield. The requirements of

§ 393.60, particularly the 114 mm (4.5

inch) limit specified in § 393.60(c), are

independent of the physical dimensions

of windshields.

Section 206(f) of the Motor Carrier

Safety Act of 1984 (49 U.S.C. 31136(e),

formerly 49 U.S.C. app. 2505(f))

authorizes waivers of any regulation

issued under the authority of that Act

upon a determination that the waiver is

consistent with the public interest and

the safe operation of commercial motor

vehicles.

The FHWA proposed to grant the

waiver on October 12, 1994. The notice

described the agency’s review of

automotive engineering recommended

practices, the National Highway Traffic

Safety Administration’s Federal Motor

Vehicle Safety Standards, and recent

research concerning drivers’ field of

view. It also examined current CMV cab

designs related to placement of interior

mirrors and sunvisors which occupy

approximately the same space proposed

for the AVI transponder. Based on the

information obtained from this review,

the FHWA concluded that a transponder

mounted at the approximate center of

the top of the windshield would be

extremely unlikely to create a situation

inconsistent with the safe operation of

a CMV. This location is well outside the

area recommended for windshield

wiper sweep under the Society of

Automotive Engineers (SAE)

Recommended Practice J198

(Windshield Wiper Systems—Trucks,

Buses, and Multipurpose Vehicles) and

the area recommended for windshield

defrosting under Recommended Practice

J342 (Windshield Defrosting Systems

Performance Guidelines—Trucks,