Farm Credit Administration (FCA).
This regulation contains cost-of-living adjustments for all civil money penalties (CMPs) under our jurisdiction. The Federal Civil Penalties Inflation Adjustment Act of 1990 requires us to adjust our CMPs at least once every 4 years for inflation to ensure that the penalties deter future violations. The new penalties are $1,170 per day for violation of an order that has become final and $580 per day for violation of the law or regulations.
The regulation will become effective on October 23, 2000.Start Further Info
FOR FURTHER INFORMATION CONTACT:
Mark L. Johansen, Policy Analyst, Office of Policy and Analysis, Farm Credit Administration, McLean, VA 22102-5090, (703) 883-4498, TDD (703) 883-4444,
Rebecca S. Orlich, Senior Attorney, Office of General Counsel, Farm Credit Administration, McLean, VA 22102-5090, (703) 883-4020, TDD (703) 883-4444.End Further Info End Preamble Start Supplemental Information
The objective of this regulation is to comply with Congress' mandate to adjust CMP amounts for inflation.
II. Cost-of-Living Adjustment
The Federal Civil Penalties Inflation Adjustment Act of 1990  (FCPIA Act), as amended by the Debt Collection Improvement Act of 1996 (DCIA), requires each agency to adjust each CMP within its jurisdiction by a prescribed cost-of-living adjustment at least once every 4 years. This cost-of-living adjustment is based on the formula described in section 5(b) of the FCPIA Act. We made our last adjustment in October 1996. Section 6 of the FCPIA Act states that any increase must apply only to violations that occur after the date the increase takes effect.
This adjustment requirement affects two provisions of section 5.32(a)  of the Farm Credit Act of 1971, as amended (1971 Act), which allows the FCA to impose CMPs on Farm Credit System (FCS) institutions and their related parties. Section 5.32(a) specifies that any FCS institution or any officer, director, employee, agent, or other person participating in the conduct of the affairs of an FCS institution who violates the terms of an order that has become final and was issued under section 5.25 or 5.26 of the 1971 Act must pay up to $1,000 per day for each day during which such violation continues. Orders issued under section 5.25 or 5.26 include temporary and permanent cease-and-desist orders. In addition, section 5.32(h) provides for the FCA to treat a directive issued under section 4.3(b)(2), 4.3A(e), or 4.14A(i) of the 1971 Act as a final order issued under section 5.25 for purposes of assessing a CMP. Section 5.32(a) also states that “[a]ny such institution or person who violates any provision of the  Act or any regulation issued under this  Act shall forfeit and pay a civil penalty of not more than $500 per day for each day during which such violation continues.” Since the 1996 adjustment, our regulations have required penalty levels of $1,100 and $550, respectively.
The prescribed cost-of-living adjustment formula or inflation factor is based on the difference between the Consumer Price Index (CPI) for June of the preceding year of the adjustment (June 1999) and the CPI for June of the year the CMP was last set (June 1996). We used the Department of Labor, Bureau of Labor Statistics—All Urban Consumers tables, in which the period 1982-84 was equal to 100, to get the CPI numbers. In this case, the CPI value was 156.7 for June 1996 and was 166.2 for June 1999, resulting in an inflation factor of 1.06 (i.e., a 6-percent increase). The prerounding adjustments are $1,166.69 from $1,100 for violations of final orders and $583.34 from $550 for violations of the 1971 Act and FCA regulations.
Section 5 of the FCPIA Act prescribes a rounding method based on the amount of the calculated increase. In our case, the applicable rounding method is to the nearest $10 for increases less than or equal to $100. Therefore, the resulting penalties are $1,170 for violations of a final order and $580 for violations of the 1971 Act and FCA regulations. The existing penalty amounts will continue to apply to violations that occurred Start Printed Page 46088before the effective date of this amendment.
We are also revising the language of § 622.61(a) to clarify that the final order violations include violations of a capital directive (issued under section 4.3(b)(2) or 4.3A(e) of the Farm Credit Act) or a restructuring directive (issued under section 4.14A(i)), as well as violations of cease-and-desist orders. Penalties for violations of these directives are prescribed by section 5.32(h) of the 1971 Act.
The FCPIA Act gives Federal agencies no discretion in the adjustment of CMPs for the rate of inflation, and it also requires a reassessment on at least a 4-year cycle. Moreover, this regulation is ministerial, technical, and noncontroversial. For these reasons, the FCA finds good cause to determine that public notice and an opportunity to comment are impracticable, unnecessary, and contrary to the public interest pursuant to the Administrative Procedure Act, 5 U.S.C. 553(b)(B), and adopts this rule in final form.Start List of Subjects
List of Subjects in 12 CFR Part 622End List of Subjects Start Amendment Part
For the reasons stated in the preamble, part 622 of chapter VI, title 12 of the Code of Federal Regulations is amended to read as follows:End Amendment Part Start Part
PART 622—RULES OF PRACTICE AND PROCEDUREEnd Part Start Amendment Part
1. Revise the authority citation for part 622 to read as follows:End Amendment Part
Subpart B—Rules and Procedures for Assessment and Collection of Civil Money PenaltiesStart Amendment Part
2. Revise § 622.61 to read as follows:End Amendment Part
The maximum amount of each civil money penalty within FCA's jurisdiction is adjusted in accordance with the Federal Civil Penalties Inflation Adjustment Act of 1990, as amended (28 U.S.C. 2461 note), as follows:
(a) Amount of civil money penalty imposed under section 5.32 of the Act for violation of a final order issued under section 5.25 or 5.26 of the Act:
|If the violation occurred—||The maximum daily amount is—|
|Before October 23, 2000||$1,100|
|On or After October 23, 2000||1,170|
(b) Amount of civil money penalty for violation of the Act or regulations:
|If the violation occurred—||The maximum daily amount is—|
|Before October 23, 1996||$500|
|On or after October 23, 1996, but before October 23, 2000||550|
|On or After October 23, 2000||580|
Dated: July 21, 2000.
Kelly Mikel Williams,
Secretary, Farm Credit Administration Board.
4. We note that the 1996 adjustment was based on the June 1995 CPI. In calculating the new adjustments, the FCPIA Act requires us to use the 3-year period from June 1996 to June 1999.Back to Citation
[FR Doc. 00-18962 Filed 7-26-00; 8:45 am]
BILLING CODE 6705-01-P