2023-28555. Civil Monetary Penalty Inflation Adjustment

AGENCY:

Environmental Protection Agency (EPA).

ACTION:

Final rule.

SUMMARY:

The Environmental Protection Agency (EPA) is promulgating this final rule to adjust the level of the maximum (and minimum) statutory civil monetary penalty amounts under the statutes the 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 the statutory maximum (and minimum) amount of civil monetary penalties to reflect inflation, maintain the deterrent effect of statutory civil monetary penalties, and promote compliance with the law. The rule does not establish specific civil monetary penalty amounts the EPA may seek in particular cases. The EPA calculates those amounts, as appropriate, based on the facts of particular cases and applicable agency penalty policies. The EPA's civil penalty policies, which guide enforcement personnel on how to exercise the EPA's discretion within 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 the violator's ability to pay.

DATES:

This final rule is effective December 27, 2023.

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; [e-mail].

SUPPLEMENTARY INFORMATION:

I. Background

The 2015 Act ^[1] requires each Federal agency to adjust the statutory civil monetary penalties under the laws implemented by that agency annually, to account for inflation. Section 4 of the 2015 Act requires each Federal agency to publish these adjustments by January 15 of each year. The purpose of the 2015 Act is to maintain the deterrent effect of civil monetary penalties by translating originally enacted statutory civil penalty amounts to today's dollars and rounding statutory civil penalties to the nearest dollar.

Since January 15, 2017, the EPA has made seven annual adjustments: (1) on January 12, 2017, effective on January 15, 2017 (82 FR 3633); (2) on January 10, 2018, effective on January 15, 2018 (83 FR 1190); (3) on February 6, 2019, effective the same day (84 FR 2056), with a subsequent correction on February 25, 2019 (84 FR 5955); (4) on January 13, 2020, effective the same day (85 FR 1751); (5) on December 23, 2020, effective the same day (85 FR 83818); (6) on January 12, 2022, effective the same day (87 FR 1676); and (7) on January 6, 2023, effective the same day (88 FR 986). This rule implements the eighth annual adjustment mandated by the 2015 Act.

The 2015 Act provides a formula for calculating the adjustments. Each statutory maximum and minimum ^[2] civil monetary penalty, as currently adjusted, is multiplied by the cost-of-living adjustment multiplier, which is the percentage by which the Consumer Price Index for all Urban Consumers (CPI–U) for the month of October 2023 exceeds the CPI–U for the month of October 2022.^[3]

With this rule, the new statutory maximum and minimum penalty levels listed in the third column of Table 1 of 40 CFR 19.4 will apply to all civil monetary penalties assessed on or after December 27, 2023, for violations that occurred after November 2, 2015, the date the 2015 Act was enacted. The former maximum and minimum statutory civil monetary penalty levels, which are in the fourth column of Table 1 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 6, 2023, but before December 27, 2023. The statutory civil monetary penalty levels that apply to violations that occurred on or before November 2, 2015, are codified at Table 2 to 40 CFR 19.4. The fifth column of Table 1 and the seventh column of Table 2 display the statutory civil monetary penalty levels as originally enacted.

The formula for determining the cost-of-living or inflation adjustment to statutory civil monetary penalties consists of the following steps:

Step 1: The cost-of-living adjustment multiplier for 2024 is the percentage by which the CPI–U of October 2023 (307.671) exceeds the CPI–U for the month of October 2022 (298.012), which is 1.03241.^[4] Multiply 1.03241 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 Procedure Act

Pursuant to section 4 of the 2015 Act, each Federal agency is required to publish adjustments no later than January 15 each year. In accordance with section 553 of the Administrative Procedure Act (APA), 5 U.S.C. 553, 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. Consistent with the language of the 2015 Act, this rule is not subject to notice and an opportunity for public comment and will be effective on December 27, 2023.

III. Statutory and Executive Order Reviews

Additional information about these statutes and Executive orders can be found at https://www.epa.gov/​laws-regulations/​laws-and-executive-orders.

A. Executive Order 12866: Regulatory Planning and Review and Executive Order 14094: Modernizing Regulatory Review

This action is not a significant regulatory action as defined in Executive Order 12866, as amended by Executive Order 14094, and was therefore not subject to a requirement for Executive Order 12866 review.

B. 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 monetary 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.

C. 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 Administrative Procedure Act (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.

D. 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 the 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, the EPA has no policy discretion to vary the amount of the adjustment.

E. 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.

F. 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 monetary penalty levels to reflect and keep pace with the levels originally set by Congress when the statutes were enacted or amended. The calculation of the increases is formula-driven and prescribed by statute, and the 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. Thus, Executive Order 13175 does not apply to this action.

G. 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. Since this action does not concern human health, EPA's Policy on Children's Health also does not apply.

H. Executive Order 13211: Actions Concerning Regulations 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.

I. National Technology Transfer and Advancement Act (NTTAA)

The rulemaking does not involve technical standards.

J. Executive Order 12898: Federal Actions To Address Environmental Justice in Minority Populations and Low-Income Populations and Executive Order 14096: Revitalizing Our Nation's Commitment to Environmental Justice for All

The EPA believes that this type of action does not concern human health or environmental conditions and therefore cannot be evaluated with respect to potentially disproportionate and adverse effects on communities with environmental justice concerns. As mandated by the 2015 Act, this rule adjusts for inflation the statutory civil monetary penalty amounts of the statutes administered by the EPA.

EPA acknowledges that the annual mandatory increase in civil penalty amounts to account for inflation may result in further deterrents of environmental violations that may trigger civil penalties. Deterring violations has the benefit of promoting the overarching purpose of environmental enforcement and may have a positive impact on the human health or environment of all populations including communities with environmental justice concerns.

K. Congressional Review Act (CRA)

This action is subject to the CRA, and the 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 EPA finds that the APA's notice and comment rulemaking procedures are unnecessary because the 2015 Act directs Federal agencies to publish their annual penalty inflation adjustments “notwithstanding section 553 [of the APA].”

List of Subjects in 40 CFR Part 19

• Environmental protection
• Administrative practice and procedure
• Penalties

Michael S. Regan,

Administrator.

For the reasons set out in the preamble, the 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

Effective date.

(a) The statutory civil monetary penalty levels set forth in the third column of Table 1 of § 19.4 apply to all violations which occur or occurred after November 2, 2015, where the penalties are assessed on or after December 27, 2023. The statutory civil monetary penalty levels set forth in the fourth column of Table 1 of § 19.4 apply to all violations which occurred after November 2, 2015, where the penalties were assessed on or after January 6, 2023, but before December 27, 2023.

(b) The statutory monetary penalty levels in the third column of Table 2 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 monetary penalty levels set forth in the fourth column of Table 2 of § 19.4 apply to all violations which occurred after January 12, 2009, through December 6, 2013. The statutory civil monetary penalty levels set forth in the fifth column of Table 2 of § 19.4 apply to all violations which occurred after March 15, 2004, through January 12, 2009. The statutory civil monetary penalty levels set forth in the sixth column of Table 2 of § 19.4 apply to all violations which occurred after January 30, 1997, through March 15, 2004.

3. Revise the section heading, introductory text, and Table 1 of § 19.4 to read as follows:

§ 19.4

Statutory civil monetary penalties, as adjusted for inflation, and tables.

Table 1 of this section sets out the statutory civil monetary penalty provisions of statutes administered by the EPA, with the third column setting out the latest operative statutory civil monetary penalty levels for violations that occur or occurred after November 2, 2015, where penalties are assessed on or after December 27, 2023. The fourth column displays the operative statutory civil monetary penalty levels where penalties were assessed on or after January 6, 2023, but before December 27, 2023. Table 2 of this section sets out the statutory civil monetary penalty provision of statutes administered by the EPA, with the operative statutory civil monetary 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 1 of § 19.4—Civil Monetary Penalty Inflation Adjustments

U.S. Code citation	Environmental statute	Statutory civil monetary penalties for violations that occur or occurred after November 2, 2015, where penalties are assessed on or after December 27, 2023	Statutory civil monetary penalties for violations that occurred after November 2, 2015, where penalties were assessed on or after January 6, 2023, but before December 27, 2023	Statutory civil monetary penalties, as enacted
7 U.S.C. 136 l (a)(1)	FEDERAL INSECTICIDE, FUNGICIDE, AND RODENTICIDE ACT (FIFRA)	$24,255	$23,494	$5,000
7 U.S.C. 136 l (a)(2) 1	FIFRA	3,558/2,293/3,558	3,446/2,221/3,446	1,000/500/1,000
15 U.S.C. 2615(a)(1)	TOXIC SUBSTANCES CONTROL ACT (TSCA)	48,512	46,989	25,000
15 U.S.C. 2647(a)	TSCA	13,946	13,508	5,000
15 U.S.C. 2647(g)	TSCA	11,524	11,162	5,000
31 U.S.C. 3802(a)(1)	PROGRAM FRAUD CIVIL REMEDIES ACT (PFCRA)	13,946	13,508	5,000
31 U.S.C. 3802(a)(2)	PFCRA	13,946	13,508	5,000
33 U.S.C. 1319(d)	CLEAN WATER ACT (CWA)	66,712	64,618	25,000
33 U.S.C. 1319(g)(2)(A)	CWA	26,685/66,712	25,847/64,618	10,000/25,000
33 U.S.C. 1319(g)(2)(B)	CWA	26,685/333,552	25,847/323,081	10,000/125,000
33 U.S.C. 1321(b)(6)(B)(i)	CWA	23,048/57,617	22,324/55,808	10,000/25,000
33 U.S.C. 1321(b)(6)(B)(ii)	CWA	23,048/288,080	22,324/279,036	10,000/125,000
33 U.S.C. 1321(b)(7)(A)	CWA	57,617/2,304	55,808/2,232	25,000/1,000
33 U.S.C. 1321(b)(7)(B)	CWA	57,617	55,808	25,000
33 U.S.C. 1321(b)(7)(C)	CWA	57,617	55,808	25,000
33 U.S.C. 1321(b)(7)(D)	CWA	230,464/6,913	223,229/6,696	100,000/3,000
33 U.S.C. 1414b(d)(1)(A)	MARINE PROTECTION, RESEARCH, AND SANCTUARIES ACT (MPRSA)	1,535	1,487	600
33 U.S.C. 1415(a)	MPRSA	242,550/319,953	234,936/309,909	50,000/125,000
33 U.S.C. 1901 note ( see 1409(a)(2)(A))	CERTAIN ALASKAN CRUISE SHIP OPERATIONS (CACSO)	17,683/44,206	17,128/42,818	10,000/25,000
33 U.S.C. 1901 note ( see 1409(a)(2)(B))	CACSO	17,683/221,026	17,128/214,087	10,000/125,000
33 U.S.C. 1901 note ( see 1409(b)(1))	CACSO	44,206	42,818	25,000
33 U.S.C. 1908(b)(1)	ACT TO PREVENT POLLUTION FROM SHIPS (APPS)	90,702	87,855	25,000
33 U.S.C. 1908(b)(2)	APPS	18,139	17,570	5,000
42 U.S.C. 300g–3(b)	SAFE DRINKING WATER ACT (SDWA)	69,733	67,544	25,000
42 U.S.C. 300g–3(g)(3)(A)	SDWA	69,733	67,544	25,000
42 U.S.C. 300g–3(g)(3)(B)	SDWA	13,946/48,586	13,508/47,061	5,000/25,000
42 U.S.C. 300g–3(g)(3)(C)	SDWA	48,586	47,061	25,000
42 U.S.C. 300h–2(b)(1)	SDWA	69,733	67,544	25,000
42 U.S.C. 300h–2(c)(1)	SDWA	27,894/348,671	27,018/337,725	10,000/125,000
42 U.S.C. 300h–2(c)(2)	SDWA	13,946/348,671	13,508/337,725	5,000/125,000
42 U.S.C. 300h–3(c)	SDWA	24,255/51,744	23,494/50,120	5,000/10,000
42 U.S.C. 300i(b)	SDWA	29,154	28,239	15,000
42 U.S.C. 300i–1(c)	SDWA	169,700/1,697,012	164,373/1,643,738	100,000/1,000,000
42 U.S.C. 300j(e)(2)	SDWA	12,127	11,746	2,500
42 U.S.C. 300j–4(c)	SDWA	69,733	67,544	25,000
42 U.S.C. 300j–6(b)(2)	SDWA	48,586	47,061	25,000
42 U.S.C. 300j–23(d)	SDWA	12,799/127,983	12,397/123,965	5,000/50,000
42 U.S.C. 4852d(b)(5)	RESIDENTIAL LEAD–BASED PAINT HAZARD REDUCTION ACT OF 1992	21,699	21,018	10,000
42 U.S.C. 4910(a)(2)	NOISE CONTROL ACT OF 1972	45,850	44,411	10,000
42 U.S.C. 6928(a)(3)	RESOURCE CONSERVATION AND RECOVERY ACT (RCRA)	121,275	117,468	25,000
42 U.S.C. 6928(c)	RCRA	73,045	70,752	25,000
42 U.S.C. 6928(g)	RCRA	90,702	87,855	25,000
42 U.S.C. 6928(h)(2)	RCRA	73,045	70,752	25,000
42 U.S.C. 6934(e)	RCRA	18,139	17,570	5,000
42 U.S.C. 6973(b)	RCRA	18,139	17,570	5,000
42 U.S.C. 6991e(a)(3)	RCRA	73,045	70,752	25,000
42 U.S.C. 6991e(d)(1)	RCRA	29,221	28,304	10,000
42 U.S.C. 6991e(d)(2)	RCRA	29,221	28,304	10,000
42 U.S.C. 7413(b)	CLEAN AIR ACT (CAA)	121,275	117,468	25,000
42 U.S.C. 7413(d)(1)	CAA	57,617/460,926	55,808/446,456	25,000/200,000
42 U.S.C. 7413(d)(3)	CAA	11,524	11,162	5,000
42 U.S.C. 7524(a)	CAA	57,617/5,761	55,808/5,580	25,000/2,500
42 U.S.C. 7524(c)(1)	CAA	460,926	446,456	200,000
42 U.S.C. 7545(d)(1)	CAA	57,617	55,808	25,000
42 U.S.C. 9604(e)(5)(B)	COMPREHENSIVE ENVIRONMENTAL RESPONSE, COMPENSATION, AND LIABILITY ACT (CERCLA)	69,733	67,544	25,000
42 U.S.C. 9606(b)(1)	CERCLA	69,733	67,544	25,000
42 U.S.C. 9609(a)(1)	CERCLA	69,733	67,544	25,000
42 U.S.C. 9609(b)	CERCLA	69,733/209,202	67,544/202,635	25,000/75,000
42 U.S.C. 9609(c)	CERCLA	69,733/209,202	67,544/202,635	25,000/75,000
42 U.S.C. 11045(a)	EMERGENCY PLANNING AND COMMUNITY RIGHT–TO–KNOW ACT (EPCRA)	69,733	67,544	25,000
42 U.S.C. 11045(b)(1)(A)	EPCRA	69,733	67,544	25,000
42 U.S.C. 11045(b)(2)	EPCRA	69,733/209,202	67,544/202,635	25,000/75,000
42 U.S.C. 11045(b)(3)	EPCRA	69,733/209,202	67,544/202,635	25,000/75,000
42 U.S.C. 11045(c)(1)	EPCRA	69,733	67,544	25,000
42 U.S.C. 11045(c)(2)	EPCRA	27,894	27,018	10,000
42 U.S.C. 11045(d)(1)	EPCRA	69,733	67,544	25,000
42 U.S.C. 14304(a)(1)	MERCURY-CONTAINING AND RECHARGEABLE BATTERY MANAGEMENT ACT (BATTERY ACT)	19,437	18,827	10,000
42 U.S.C. 14304(g)	BATTERY ACT	19,437	18,827	10,000
1  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 Improvements Act of 2015 (Section 701 of Pub. L.114–74) was signed into law on November 2, 2015, and amended the Federal Civil Penalties Inflation Adjustment Act of 1990.

2.  Under Section 3(2)(A) of the 2015 Act, a “`civil monetary penalty' [is] any penalty, fine or other sanction that is for 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)(A) of the Marine Protection, Research, and Sanctuaries Act, 33 U.S.C. 1414b(d)(1)(A), 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.

3.  Current and historical CPI–U's can be found on the Bureau of Labor Statistics' websites here: https://www.bls.gov/​cpi/​tables/​supplemental-files/​historical-cpi-u-202309.pdf and https://www.bls.gov/​news.release/​pdf/​cpi.pdf.

4.  Section 5(b) of the 2015 Act provides that the term “cost-of-living adjustment” means the percentage (if any) for each civil monetary penalty by which—

(A) the Consumer Price Index for the month of October preceding the date of the adjustment, exceeds

(B) the Consumer Price Index for the month of October 1 year before the month of October referred to in subparagraph (A).

Because the CPI–U for October 2023 is 307.671 and the CPI–U for October 2022 is 298.012, the cost-of-living multiplier is 1.03241 (307.671 divided by 298.012).