25662 Federal Register / Vol. 61, No. 100 / Wednesday, May 22, 1996 / Notices

1The final figure for the annual average PPI–FG

is published by the Bureau of Labor Statistics in

mid-May of each year. This figure is publicly

available from the Division of Industrial Prices and

Price Indexes of the Bureau of Labor Statistics, at

(202) 606–7705, and is available in print in August

in Table 1 of the annual data supplement to the BLS

publication Producer Price Indexes.

2 [127.9¥125.5]/125.5=.019124;

.019124¥.01=.009124.

at 888 First Street, NE., Washington, DC

20426.

The Commission Issuance Posting

System (CIPS), an electronic bulletin

board service, provides access to the

texts of formal documents issued by the

Commission. CIPS is available at no

charge to the user and may be accessed

using a personal computer with a

modem by dialing (202) 208–1397 if

dialing locally or 1–800–856–3720 if

dialing long distance. To access CIPS,

set your communications software to

use 19200, 14400, 12000, 9600, 7200,

4800, 2400, or 1200 bps, full duplex, no

parity, 8 data bits, and 1 stop bit. The

full text of this document will be

available on CIPS indefinitely in ASCII

and WordPerfect 5.1 format. The

complete text on diskette in

WordPerfect format may also be

purchased from the Commission’s copy

contractor, La Dorn Systems

Corporation, also located in the Public

Reference Room at 888 First Street, NE.,

Washington, DC 20426.

Notice of Annual Change in the

Producer Price Index for Finished

Goods, Minus One Percent

Issued May 16, 1996.

The Commission’s regulations include

a methodology for oil pipelines to

change their rate through use of an

index systems that establishes ceiling

levels for such rates. The index system

as set forth at 18 CFR 342.3 is based on

the annual change in the Producer

Prince Index for Finished Goods (PPI–

FG), minus one percent. The regulations

provide that each year the Commission

will publish an index reflecting the final

change in the PPI–FG, minus one

percent, after the final PPI–FG is made

available by the Bureau of Labor

Statistics in May of each calendar year.

The annual average PPI–FG index

figure for 1994 was 125.5 and the

annual average PPI–FG index for 1995

was 127.9.1 Thus, the percent change

(expressed as a decimal) in the annual

average PPI–FG from 1994 to 1995,

minus one percent, is .009124.2 Oil

pipelines must multiply their July 1,

1995–June 30, 1996 rate ceiling levels

by 1.009124 to compute their rate

ceiling levels for the period July 1, 1996,

through June 30, 1997, in accordance

with 18 342.3(d).

To obtain July 1, 1996–June 30, 1997

ceiling levels, pipelines must first

calculate their ceiling levels for the

January 1, 1995–June 30, 1995 index

period, by multiplying their December

31, 1994 rates by 1.009175. Pipelines

must then multiply those ceiling levels.

Finally, pipelines must multiply their

July 1, 1995–June 30, 1996 ceiling levels

by 1.009124 to obtain the July 1, 1996–

June 30, 1997 ceiling levels. See

Explorer Pipeline Company, 71 FERC ¶

61,416 at n. 6 (1995) for an explanation

of how ceiling levels must be calculated.

Lois D. Cashell,

Secretary.

[FR Doc. 96–12850 Filed 5–21–96; 8:45 am]

BILLING CODE 6717–01–M

Office of Hearings and Appeals

Implementation of Special Refund

Procedures

AGENCY: Office of Hearings and Appeals,

Department of Energy.

ACTION: Notice of Implementation of

Special Refund Procedures.

SUMMARY: The Office of Hearings and

Appeals (OHA) of the Department of

Energy announces procedures for

disbursement of $48,307.13 of crude oil

overcharge funds obtained by the DOE

from Texas American Oil Corporation

(Texas American), Case No. VEF–0019.

The OHA has determined that these

funds, plus accrued interest, be

distributed as direct restitution to

individual claimants who were injured

by crude oil overcharges.

FOR FURTHER INFORMATION CONTACT:

Richard W. Dugan, Associate Director,

Office of Hearings and Appeals, 1000

Independence Ave., SW., Washington

DC 20585–0107, Telephone No. (202)

426–1575.

SUPPLEMENTARY INFORMATION: In

accordance with 10 CFR § 205.282(c),

notice is hereby given of the issuance of

the Decision and Order set forth below.

The Decision and Order sets forth the

procedures that the DOE has formulated

to distribute $48,307.13 (plus accrued

interest) remitted to the DOE by the

trustee-in-bankruptcy for Texas

American. The DOE is currently holding

these funds in an interest-bearing

escrow account pending distribution.

The OHA will allocate all of the crude

oil overcharge funds obtained from

Texas American for individual

claimants. This is in accordance with

Texas American Oil Corp. v. DOE, 44

F.3d 1557 (Fed. Cir. 1995) (en banc), in

which the United States Court of

Appeals for the Federal Circuit held that

the DOE’s claim in the Texas American

bankruptcy proceeding on behalf of

individual claimants should have a

higher priority than its claim on behalf

of the states and federal government.

Pursuant to that decision, the

bankruptcy court distributed to the DOE

an amount equivalent to only 20 percent

of its liquidated claim in the Texas

American bankruptcy proceeding, since

under the DOE’s Modified Statement of

Restitutionary Policy in Crude Oil

Cases, 51 FR 27899 (August 4, 1986), a

maximum of 20 per cent of the crude oil

overcharge funds remitted to the DOE

are reserved for injured purchasers of

refined petroleum products.

Refunds to eligible purchasers will be

based on the volume of products that

they purchased during the price control

period. The volumetric refund amount

is $0.0016 per gallon. Because the June

30, 1995 deadline for crude oil refund

applications has passed, no new

applications for refund will be accepted

in this proceeding. As we state in the

Decision, the Texas American funds

will be added to the general crude oil

overcharge pool for direct restitution to

claimants that have filed timely

applications.

Dated: May 14, 1996.

George B. Breznay,

Director, Office of Hearings and Appeals.

Decision and Order of the Department

of Energy

Implementation of Special Refund

Procedures

May 14, 1996.

Name of Case: Texas American Oil

Corporation.

Date of Filing: September 1, 1995.

Case Number: VEF–0019.

On March 14, 1996, the Office of

Hearings and Appeals (OHA) of the

Department of Energy (DOE) issued a

Proposed Decision and Order (PDO)

which tentatively established refund

procedures for the distribution of crude

oil overcharge funds obtained from

Texas American Oil Corporation (Texas

American). Texas American Oil Co.,

Case No. VEF–0019, 61 Fed. Reg. 13170

(March 26, 1996). After a review of the

comments received, the DOE has

determined that the procedures set forth

in the Proposed Decision and Order

should be adopted.

I. Background

On September 19, 1988, the OHA

issued a Remedial Order (RO) that

found that Texas American had violated

10 CFR § 211.67(e)(2) by receiving

excessive small refiner bias benefits

under the DOE’s Entitlements Program.
Federal Register / Vol. 61, No. 100 / Wednesday, May 22, 1996 / Notices 25663

1Section 726(a)(4) places non-pecuniary loss

claims in the fourth priority in the distribution of

a bankrupt estate:

11 U.S.C. § 726. Distribution of property of the

estate

* * * * *

(a)(4) fourth, in payment of any allowed claim,

whether secured or unsecured, for any fine, penalty,

or forfeiture, or for multiple, exemplary, or punitive

damages, arising before the earlier of the order for

relief or the appointment of a trustee, to the extent

that such fine, penalty, forfeiture, or damages are

not compensation for actual pecuniary loss suffered

by the holder of such claim[.]

Class 7 (Unsecured Claims) consisted of allowed

claims of unsecured creditors, while Class 9 (NonPecuniary Loss) consisted of ‘‘Allowed Claims for

any fine, penalty, or forfeiture, or for multiple,

exemplary, or punitive damages, as further

described in 11 U.S.C. § 726(a)(4).’’ Texas American

Bankruptcy Committee Plan of Liquidation §§ 3.07,

3.09.

2As of March 31, 1996, the account contained

$50,815.65, consisting of $48,307.13 principal and

$2,508.52 interest.

3We also do not accept the States’ attempt to blur

the distinction between recipients of direct and

indirect restitution. It is true that, prior to the

Federal Circuit decision, it was the DOE’s

consistent position that both types of recipients

should be treated the same for purpose of

distributing funds from bankrupt estates.

Nevertheless, our prior Decisions make it clear that,

unlike the beneficiaries of indirect restitution,

individual claimants cannot receive direct refunds

without a finding of injury, though that finding may

be based on a presumption of injury. See 10 C.F.R.

§ 205.282(e) (‘‘[T]he standards for evaluation of

individual claims may be based upon appropriate

presumptions’’). See also Ernest A. Allerkamp, 17

DOE ¶ 85,079 at 88,175–76 (1988); City of

Columbus, Georgia, 16 DOE ¶ 85,550 (1987).

Texas American Oil Corp., 17 DOE

¶ 83,017 (1988). However, Texas

American had filed a petition in

bankruptcy on July 2, 1987, and its

bankruptcy proceeding was still

pending when the RO was issued. The

trustee-in-bankruptcy approved the

DOE’s claim in the amount of

$241,535.67, but classified it as a nonpecuniary loss in accordance with

Section 726(a)(4) of the Bankruptcy

Code and Class 9 of the Plan of

Liquidation.1 Since Class 9 claims were

inferior to Class 7 claims, and there

were insufficient assets to satisfy any

Class 9 claim, or to satisfy fully the

Class 7 claims, the effect of the trustee’s

determination was to preclude the DOE

from receiving any compensation from

Texas American’s estate.

The DOE argued before the

Bankruptcy Court that the trustee’s

determination was erroneous on the

grounds that its claim was for restitution

and therefore was a Class 7 claim. The

Bankruptcy Court, however, rejected the

DOE’s position and held that Class 9

was the proper classification since the

DOE’s claim was not for actual

pecuniary loss suffered by the holder of

the claim. In re Texas American Oil

Corp., No. 387–33522–SAF–11 (Bankr.

N.D. Tex. Mar. 5, 1992). This decision

was reversed by the U.S. District Court

which, relying on a prior decision of the

Temporary Emergency Court of Appeals

(TECA), held that a DOE claim under

Section 209 of the Economic

Stabilization of 1970 (ESA), 12 U.S.C.

§ 1904 note, was properly placed in the

same class and priority as the general

unsecured claims of other creditors.

Texas American Oil Corp. v. DOE, No.

3:92–CV–1146–G (N.D. Tex. Sept. 14,

1992) (citing DOE v. West Texas

Marketing Corp., 763 F.2d 1411 (Temp.

Emer. Ct. App. 1985) (West Texas)).

This decision was in turn reversed by

the United States Court of Appeals for

the Federal Circuit, which held that the

DOE’s claim in the Texas American

bankruptcy proceeding should be

bifurcated, with the portion claimed on

behalf of individual persons who

suffered actual injury to be classified in

Class 7 of the Plan of Liquidation and

the portion to be paid to the federal and

state governments to be classified in

Class 9. Texas American Oil Corp. v.

DOE, 44 F.3rd 1557 (Fed. Cir. 1995)(en

banc). On remand, the Bankruptcy Court

implemented the Federal Circuit’s

decision by distributing the 20 percent

of DOE’s liquidated claim ($48,307.13)

that fell within Class 7 to DOE and the

remaining 80 percent ($193,228.53) to

the other Class 7 creditors. In re Texas

American Oil Corp., No. 387–33522–

SAF–11 (Bankr. N.D. Tex. April 12,

1995). The funds that the DOE received

from Texas American were deposited in

an interest-bearing escrow account

maintained by the Department of the

Treasury.2

In accordance with 10 CFR Part 205,

Subpart V, on September 1, 1995, the

Office of General Counsel, Regulatory

Litigation (OGC) (formerly the Economic

Regulatory Administration) filed a

Petition for the Implementation of

Special Refund Procedures that

requested OHA to formulate and

implement procedures to distribute the

Texas American funds. On January 16,

1996, we issued a Proposed Decision

and Order that tentatively established

refund procedures for the distribution of

crude oil overcharge funds obtained

from Texas American and four other

firms. Brio Petroleum, Inc., Case Nos.

VEF–0017 et al., 61 FR 1919 (January

24, 1996). In accordance with the

Modified Statement of Restitutionary

Policy in Crude Oil Cases (MSRP), 51

FR 27899 (August 4, 1986), that the DOE

issued in connection with the Final

Settlement Agreement approved in In re

The Department of Energy Stripper Well

Exemption Litigation, 653 F. Supp. 108

(D. Kan. 1986), the January 16 Proposed

Decision proposed that 40 percent of the

funds be disbursed to the federal

government, another 40 percent be

disbursed to the states, and the

remaining 20 percent be reserved for

applicants who file claims showing that

they were injured by crude oil

overcharges. However, we subsequently

determined that the circumstances

under which the DOE obtained the

Texas American funds required that the

funds be disbursed in a manner

different than that set forth in the

Proposed Decision. Accordingly, we

issued the March 14, 1996 PDO, in

which we tentatively determined that

all of the funds received from Texas

American be allocated to individual

claimants. On April 24, 1996, we

received comments on behalf of 14

designated states (the States). In their

comments, the States disagreed with the

refund procedures set forth in the PDO,

but asserted that they would not

formally object to them in view of the

small amount of money involved.

Instead, they reserved their right to

object to any future proposed

distributions of crude oil funds solely to

individual claimants.

II. Jurisdiction and Authority

The Subpart V regulations set forth

general guidelines which may be used

by the OHA in formulating and

implementing a plan of distribution of

funds received as a result of an

enforcement proceeding. The DOE

policy is to use the Subpart V process

to distribute such funds. For a more

detailed discussion of Subpart V and the

authority of the OHA to fashion

procedures to distribute refunds, see

Petroleum Overcharge Distribution and

Restitution Act of 1986, 15 U.S.C. § 4501

et seq. See also Office of Enforcement,

9 DOE ¶ 82,508 (1981); Office of

Enforcement, 8 DOE ¶ 82,597 (1981).

III. Refund Procedures

Since the States have not formally

objected to the proposed refund

procedures, it is not necessary for us to

respond to the specific arguments that

they raise. We do, however, disagree

with the States’ position that the

decisions of the Federal Circuit and the

Bankruptcy Court (on remand) do not

affect the manner in which we must

distribute the crude oil funds in the

present case.3 Thus, we shall distribute

the funds received from Texas American

(and accrued interest on those funds)

solely to individual claimants in the

DOE’s crude oil refund proceeding. In

our view, which we believe to be

correct, this distribution scheme is

required by the unique circumstances

under which these funds were obtained
25664 Federal Register / Vol. 61, No. 100 / Wednesday, May 22, 1996 / Notices

4The Federal Circuit in Texas American v. DOE

ascribed its unwillingness to follow the West Texas

decision to judicial, statutory, and related policy

changes that had occurred since the issuance of that

decision. The Federal Circuit also specifically

overruled TECA’s ruling that a DOE bankruptcy

claim under the ESA to be paid to the federal and

state governments on behalf of their citizens was for

restitution and not for a penalty.

by the DOE. While the Texas American

v. DOE decision is contrary to the

position of the DOE that had been

upheld in the West Texas case,4 we are

constrained by the Federal Circuit’s

decision. The clear import of that

determination is that we must use the

funds received from Texas American

solely for direct restitutionary purposes.

Moreover, as indicated above, the

Bankruptcy Court, in accordance with

the Federal Circuit’s determination,

distributed to the DOE only 20 percent

of its liquidated claim in the Texas

American bankruptcy proceeding. This

percentage is equivalent to the portion

of crude oil overcharge funds that we

have consistently reserved for

individual claimants under the MSRP.

We therefore decline to modify our

proposed allocation of the Texas

American funds in response to the

States’ comments.

Except for the manner in which the

funds will be allocated, we shall follow

the procedures set forth in prior refund

proceedings involving crude oil

overcharge funds. Thus, claimants will

be required to (i) document their

purchase volumes of petroleum

products during the August 19, 1973–

January 27, 1981 crude oil price control

period, and (ii) prove that they were

injured by the alleged crude oil

overcharges. Applicants who were endusers or ultimate consumers of

petroleum products, whose businesses

are unrelated to the petroleum industry,

and who were not subject to the DOE

price regulations will be presumed to

have been injured by Texas American’s

crude oil overcharges. In order to

receive a refund, end-users will not

need to submit any further evidence of

injury beyond the volume of petroleum

products purchased during the price

control period. We shall base refunds to

claimants on a volumetric amount that

is currently $0.0016 per gallon. See 60

FR 15562 (March 24, 1995).

A party that has already submitted a

claim in the DOE crude oil proceeding

need not file another claim in order to

obtain its appropriate restitutionary

share of crude oil funds. Moreover,

because the June 30, 1995 deadline for

crude oil refund applications has

passed, we shall not accept any new

applications. See Western Asphalt

Service, 25 DOE ¶ 85,047 (1995).

Instead, these funds will be added to the

general crude oil overcharge pool used

for direct restitution. Finally, an

applicant who has executed and

submitted a valid waiver pursuant to

one of the escrows established by the

Final Stripper Well Settlement

Agreement will be considered to have

waived its rights to apply for a crude oil

refund under Subpart V. See, e.g., MidAmerica Dairymen, Inc., v. Herrington,

878 F.2d 1448 (Temp Emer. Ct. App.

1989); see also Hoechst Celanese

Chemical, 25 DOE ¶ 85,066 (1996).

It Is Therefore Ordered That:

(1) The Director of Special Accounts

and Payroll, Office of Departmental

Accounting and Financial Systems

Development, Office of the Controller of

the Department of Energy shall take all

steps necessary to transfer the

$48,307.13 obtained from Texas

American Oil Corporation, COTS No.

N00S90460, plus accrued interest, into

the subaccount denominated ‘‘Crude

Tracking-Claimants 4,’’ Number

999DOE010Z.

(2) This is a final Order of the

Department of Energy.

[FR Doc. 96–12823 Filed 5–21–96; 8:45 am]

BILLING CODE 6450–01–P

Western Area Power Administration

Boulder Canyon Project—Proposed

Firm Power Service Base Charge

AGENCY: Western Area Power

Administration, DOE.

ACTION: Notice of Proposed Base Charge

Adjustment.

SUMMARY: The Western Area Power

Administration (Western) is announcing

the Fiscal Year 1996 annual rate

adjustment for Rate Year 1997 under

Rate Order WAPA–70 for firm power

service for the Boulder Canyon Project

(BCP). The annual rate adjustments are

a requirement of the ratesetting

methodology of WAPA–70 which was

approved on a final basis by the Federal

Energy Regulatory Commission on April

19, 1996. The existing rate schedule was

placed into effect on November 1, 1995.

The power repayment spreadsheet study

indicates that the proposed Base Charge

for BCP firm power service is necessary

to provide sufficient revenue to pay all

annual costs (including interest

expense), plus repayment of required

investment within the allowable time

period. The proposed Base Charge for

firm power service is expected to

become effective October 1, 1996.

DATES: The consultation and comment

period will begin with publication of

this notice in the Federal Register and

will end not less than 90 days later, or

August 22, 1996, whichever occurs

later. A public information forum will

be held at 10 a.m. on June 13, 1996, at

Western’s Desert Southwest Customer

Service Regional office, 615 South 43rd

Avenue, Phoenix, Arizona. A public

comment forum at which Western will

receive oral and written comments will

be held at 10 a.m. on July 15, 1996, at

Western’s Desert Southwest Customer

Service Regional office. Written

comments should be received by

Western by the end of the consultation

and comment period to be assured

consideration and should be sent to the

address below.

FOR FURTHER INFORMATION CONTACT:

Mr. J. Tyler Carlson, Regional Manager,

Desert Southwest Customer Service

Region, Western Area Power

Administration, P.O. Box 6457,

Phoenix, AZ 85005–6457, (602) 352–

2453.

Mr. Anthony H. Montoya, Assistant

Regional Manager, For Power

Marketing, Desert Southwest

Customer Service Region, Western

Area Power Administration, P.O. Box

6457, Phoenix, AZ 85005–6457, (602)

352–2780.

SUPPLEMENTARY INFORMATION: The

proposed Base Charge for BCP firm

power is based on an Annual Revenue

Requirement of $46,421,533. The Base

Charge consists of an Energy Dollar of

$23,968,846 and a Capacity Dollar of

$22,452,687. The Forecast Energy Rate

will be 5.46 mills/kilowatthour (mills/

kWh), Forecast Capacity Rate will be

$0.96 per kilowatt per month ($/kWmo).

The existing BCP firm power Base

Charge is based on an Annual Revenue

Requirement of $45,196,960, consisting

of an Energy Dollar of $23,460,351 and

a Capacity Dollar of $21,736,609. The

existing BCP forecast energy rate is 6.12

mills/kWh and forecast capacity rate is

$0.93/kW-mo.

Since the proposed rates constitute a

major rate adjustment as defined by the

procedures for public participation in

general rate adjustments, as cited below,

both a public information forum and a

public comment forum will be held.

After review of public comments,

Western will recommend proposed

charges/rates for approval on a final

basis by the Deputy Secretary of DOE

pursuant to Section 13.13 of the BCP

Implementation Agreement.

The power rates for the BCP are

established pursuant to the Department

of Energy Organization Act (42 U.S.C.

7101 et seq.), the Reclamation Act of

1902 (43 U.S.C. 391 et seq.), as amended

and supplemented by subsequent