[Federal Register Volume 64, Number 92 (Thursday, May 13, 1999)]
[Rules and Regulations]
[Pages 26240-26262]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-11816]
[[Page 26239]]
_______________________________________________________________________
Part X
_______________________________________________________________________
Department of the Interior
_______________________________________________________________________
Office of Hearings and Appeals
_______________________________________________________________________
Minerals Management Service
_______________________________________________________________________
30 CFR Parts 208, 241, 242, 243, 250, and 290 and 43 CFR Part 4
Appeals of MMS Orders; Final Rule
Federal Register / Vol. 64, No. 92 / Thursday, May 13, 1999 / Rules
and Regulations
[[Page 26240]]
DEPARTMENT OF THE INTERIOR
Office of Hearings and Appeals
Minerals Management Service
30 CFR Parts 208, 241, 242, 243, 250, and 290
43 CFR Part 4
RIN 1010-AC21
Appeals of MMS Orders
AGENCIES: Office of Hearings and Appeals (OHA) and Minerals Management
Service (MMS), Interior.
ACTION: Final rulemaking.
-----------------------------------------------------------------------
SUMMARY: OHA and MMS are amending their rules governing the appeal of
orders from MMS's Royalty Management Program and MMS's Offshore
Minerals Management. This rule makes final parts of the proposed rule
published on January 12, 1999. The rule also: implements certain
provisions of the Federal Oil and Gas Royalty Simplification and
Fairness Act of 1996 governing how appellants in royalty appeals may
demonstrate financial solvency instead of posting a surety, and
provides for new regulations to collect processing fees in appeals from
Offshore Minerals Management orders.
EFFECTIVE DATES: Effective on May 13, 1999, except that the amended
provisions of 30 CFR parts 208, 241, and 243 will be effective June 14,
1999.
FOR FURTHER INFORMATION CONTACT: David S. Guzy, Chief, Rules and
Publications Staff, telephone (303) 231-3432, FAX (303) 231-3385, e-
Mail David.Guzy@mms.gov.
SUPPLEMENTARY INFORMATION: The rule provides that 30 CFR parts 250 and
290 and 43 CFR subpart J will be effective immediately upon
publication. Under the Administrative Procedure Act at 5 U.S.C. 553(d),
an agency must find good cause to make a substantive rule effective
sooner than 30 days after the date of publication. There are certain
administrative appeals pending before the Department in which, under 30
U.S.C. 1724(h)(1), the Secretary must issue a final decision before May
13, 1999, which is less than 30 days after publication of this rule.
(May 13, 1999, is 33 months after the date of enactment of the Federal
Oil and Gas Royalty Simplification and Fairness Act of 1996, which
enacted 30 U.S.C. 1724(h).) If there is no final departmental decision
by that date, 30 U.S.C. 1724(h)(2) imposes a statutory rule of decision
in those cases. Title 43 CFR part 4 subpart J resolves various issues
involved in implementing the requirements of 30 U.S.C. 1724(h)(1) and
(2). Its provisions apply to those cases in which the Secretary must
issue a final decision by May 13, 1999, and the effect of the statutory
rule of decision if the Department does not issue a final decision by
that deadline. Title 30 CFR parts 250 and 290 contain provisions
regarding appeals of orders that are part of the integrated changes to
the orders and appeals scheme that includes the new 43 CFR part 4
subpart J. The Department therefore finds that good cause exists to
make these provisions effective immediately upon publication. The
remainder of this rule will be effective 30 days after publication.
I. Background
In May 1994, MMS began a comprehensive review of its administrative
appeals process. As part of that review, MMS held several informal
meetings with State, tribal, and industry representatives to discuss
the problems and possible solutions regarding the appeals process. The
principal problems identified included the length of the appeals
process--sometimes taking several years to resolve a case--and the
excessive costs of the process to both MMS and appellants.
In 1995, the Department of the Interior (DOI) established a Royalty
Policy Committee (RPC) under the Minerals Management Advisory Board. At
its first meeting in September 1995, the RPC established the Appeals
and Alternative Dispute Resolution (ADR) Subcommittee. The Appeals and
ADR Subcommittee was created to make recommendations to the RPC to
improve the appeals and ADR processes. Membership in the Appeals and
ADR Subcommittee included 11 representatives from industry, 5
representatives from States, and 2 representatives from Indian tribes.
The Subcommittee agreed that the principal purpose of the MMS
administrative appeals process should be the expeditious and
independent review of appeals. The RPC made a recommendation (RPC
Report) and submitted that recommendation to the Secretary of the
Interior. The primary recommendation was to change the current two-step
appeals process into a one-stage Interior Board of Land Appeals (IBLA)
administrative appeal process. On September 22, 1997, the Secretary
accepted the RPC report for consideration and proposal with some
changes and clarifications.
On August 13, 1996, the President signed into law the Federal Oil
and Gas Royalty Simplification and Fairness Act of 1996, Pub. L. 104-
185, as corrected by Pub. L. 104-200 (RSFA). RSFA amended portions of
the Federal Oil and Gas Royalty Management Act of 1982 (FOGRMA), 30
U.S.C. 1701 et seq. Before enactment of RSFA, there was no time limit
on when DOI must issue decisions in appeals of orders involving royalty
and other payments for Federal oil and gas leases. RSFA added a new
FOGRMA section 115(h), 30 U.S.C. 1724(h), governing the time frame for
DOI to process appeals of MMS orders or decisions involving royalties
and other payments due on Federal oil and gas leases. For appeals
involving Federal oil and gas leases covered by this new provision, DOI
has 33 months from the date a proceeding is commenced to complete all
levels of administrative review. If DOI does not decide the appeal
within 33 months, the appeal is deemed decided either for or against
DOI, depending on the type of order and the monetary amount at issue in
the appeal. The 33-month deadline does not apply to appeals involving
Indian leases or Federal leases for minerals other than oil and gas.
As a result of the MMS review of the appeals process and RSFA, MMS
announced a proposed rule in the Federal Register on October 28, 1996
(61 FR 55607). The proposed regulation provided for amendments to the
MMS appeals process at 30 CFR part 290. On December 31, 1997, MMS
announced that it intended to withdraw the October 28, 1996, proposed
rule when it published a revised notice of proposed rule (62 FR 68244).
Accordingly the October 28, 1996, proposed rule was withdrawn when MMS
proposed a revised appeals process on January 12, 1999 (64 FR 1930)
that included most of the RPC Report recommendations.
Two portions of the proposed rule would have implemented the RPC
recommendations. First, the new proposed 43 CFR part 4, subpart J,
would have established a new procedure for appeals of royalty orders.
That section would have replaced the current regulations at 30 CFR part
290 and 43 CFR part 4, subpart E, as they relate to appeals of royalty
orders initially to the MMS Director and then to the IBLA. Second, the
new proposed 30 CFR part 242, subpart B, would have established
procedures for orders issued by MMS and delegated States. That subpart
would have incorporated certain RSFA provisions regarding orders and
orders to perform restructured accounting and for service of orders on
lessees when orders are sent to their designees. In addition, subpart C
of proposed part 242 would have established procedures for Indian
lessors to formally request that MMS
[[Page 26241]]
take actions. Finally, subpart D of part 242 would have included the
service requirements that currently are found at 30 CFR part 243.
We have decided not to go forward at this time with the entire
appeals process that we proposed on January 12, 1999, for two major
reasons. One, we received numerous negative written and oral comments
regarding the proposed process. Two, the necessity to publish before
May 13, 1999, a final rule implementing the RSFA appeals adjudication
time requirements and the associated rule of decision under 30 U.S.C.
1724(h) for cases in which there is no final Departmental decision
prevents us from conducting a thorough and reasoned review of all the
comments we received on the appeals process. One commenter suggested
that we withdraw the proposed rule, leave the current process in place,
and only publish the portions of the proposed rule necessary to
implement RSFA. Rather than withdrawing the proposed rule, we are
making final only those portions of the proposed rulemaking necessary
to implement RSFA, and the portions of the proposed rule which received
few, if any, comments. Those portions of the rule that are part of this
final rulemaking are as follows:
(1) The sections of proposed 43 CFR part 4, subpart J, necessary to
implement the 33-month time period at 30 U.S.C. 1724(h), and allow
joinder for lessees who receive notice of an order issued to their
designee as required under 30 U.S.C. 1712(a);
(2) Proposed 30 CFR part 243, regarding stays pending appeal and
bonding, and implementing 30 U.S.C. 1724(l) which allows lessees to
demonstrate financial solvency in lieu of posting a bond or other
surety instrument pending an administrative or judicial proceeding;
(3) Proposed 30 CFR part 290 regarding appeals of MMS Offshore
Minerals Management Program (OMM) orders and related changes to 30 CFR
part 250;
(4) Proposed 30 CFR part 241 regarding civil penalties authorized
by FOGRMA; and
(5) Proposed changes to definitions in 30 CFR 208.2 and to 30 CFR
208.16 regarding appeals of contracting officers' decisions by
purchasers of Federal royalty oil.
Because we are not finalizing the entire proposed rule, we will
continue to require appellants to use the appeals procedures for
royalty orders found at 30 CFR part 290 and 43 CFR part 4, subpart E,
until we can publish a final rule on the appeals process. However, for
royalty-related appeals to the MMS Director, the rules are now located
at 30 CFR part 290, subpart B. That subpart is revised to contain
appropriate headings and provisions of the proposed rule necessary to
implement RSFA. Subpart A contains the procedures in the proposed rule
for OMM appeals.
II. Comments on Proposed Rule
The proposed rulemaking provided a 60-day public comment period
which ended March 15, 1999. On February 16, 1999, DOI held a public
hearing in Houston, Texas, to receive oral comments on the proposed
rule. That public hearing was announced in the Federal Register (64 FR
3262, January 21, 1999). Those attending included representatives of
natural gas, oil, and coal producers, including representatives both of
large integrated producers and of smaller independent producers.
Participants in the public hearing had the opportunity to ask specific
questions about the proposed rule and to provide comments on the
proposed rule.
MMS received written comments from 13 commenters during the comment
period. Two additional commenters submitted late comments, which we
also accepted and considered. Thus, a total of 15 comments were
accepted for review. One of the comments was from the State of
California, 1 was from a mining association, 3 were from oil and gas
trade associations, 8 were from industry, 1 was from an Administrative
Law Judge and Attorney-Advisor, from the DOI Salt Lake City Office of
the Hearings Division, Office of Hearings and Appeals, and 1 was from a
law firm.
We reviewed and analyzed all of the comments pertaining to the
sections that are part of this final rulemaking and, in some instances,
revised the language of the final rule based on these comments. The
following is a discussion of the specific comments we received and our
response by section number.
III. Section-by-Section Analysis, 30 CFR Part 208
Comment--We received no comments on the proposed amendments to part
208.
Response--Although we received no comments regarding this part, we
made some minor changes necessary to reflect that we are not making the
entire proposed rule final at this time.
IV. Section-by-Section Analysis, 30 CFR Part 241 Civil Penalties
While the focus of the comments to this proposed rulemaking
concerned the provisions of 43 CFR part 4, subpart J, several comments
were received with reference to this part. Most of the comments concern
sections of the rule in which no substantive change is proposed--where
MMS has simply attempted to restate in plain language the rule under
which MMS has operated for approximately 15 years. All comments
received concerning this part were received from an association of oil
and gas producers. Where we received more than one comment, the
additional comments came from an individual oil and gas producer.
Section 241.50 What Definitions Apply to This Subpart?
Comments--We received two comments, which noted that the proposed
rule has not defined ``violation.'' Specifically they inquired whether,
for example, when a company fails to report, is each line that should
have been reported a violation or is it one violation for the entire
report?
Response--MMS has operated under the current regulations for 15
years without a regulatory definition of violation. Any attempt to
define the term to meet all possible circumstances would require an
impractically exhaustive list. Violations could be any failure to
comply with statutes, rules, lease terms or orders.
In response to the specific question asking whether each line would
be a separate violation, MMS has always considered that each failure to
report, or wrongly reporting a line that is required to be reported, is
a violation. For example, if a company fails to report its production
of natural gas, each line for which natural gas should have been
reported on the production report is a violation, and each month and
each lease for which it should have been reported constitutes an
additional violation.
Section 241.51 What May MMS Do if I Violate a Statute, Regulation,
Order, or Lease Term Relating to a Federal or Indian Oil and Gas Lease?
Comment--One commenter noted that this section does not provide for
the appointment of an agent to receive service. It also believes that
the Department is obligated to allow this designation under 30 U.S.C.
1719(h). In addition, the commenter also believes that the statute only
allows notice by personal service or registered mail. However, it
believes that although express mail and certified mail are not
permitted, they should be.
Response--We agree that this section, as proposed, does not allow
specifically for the appointment of an agent to receive service.
However, it proposed to use the proposed provisions of 30 CFR
[[Page 26242]]
242.304 and 242.305, which provide for service to designated persons.
For violations concerning a royalty report (Form MMS-2014), MMS will
send the notice to the individual named by the lessee, designee,
reporter or payor as the person to whom to direct correspondence. A
similar provision was included for violations concerning production
reports and audits. The proposed rule did not provide for designations
of persons to be served with notices of violations committed by payors
or designees of which the lessee receives notice. MMS has not
traditionally sent notices of noncompliance to lessees that are not
acting as reporters, designees or payors. For this reason, we did not
consider this possibility when proposing these rules. We have now added
provisions to section 241.51 clearly allowing the designation of an
agent for the receipt of notices of noncompliance and civil penalty
notices.
We also agree that we are limited in how we may serve notices under
30 U.S.C. 1719(h). While we also agree that we should be able to use
other forms of service, we have clarified that service must be by
registered mail or personal service, both in this section and in
section 241.61.
Section 241.52 What If I Correct the Violation?
Comment--One comment was received, to the effect that this section
conflicts with section 241.54, by implying that no review was possible
in the case of a company that has complied with a notice of
noncompliance within the statutory 20-day period to correct the
violation.
Response--We believe that the language in proposed section 241.54
that allowed review ``regardless of whether you correct the
violations,'' clearly means that a party may seek a hearing on the
record even if it complied with requirements stated in a notice of
noncompliance. However, we have no record of any past case in which a
violator corrected a violation and then requested a hearing.
Section 241.53 What If I Do Not Correct the Violation?
Section 241.54 How May I Request a Hearing on the Record on a Notice
of Noncompliance?
Section 241.55 Does My Request for a Hearing on the Record Affect the
Penalties?
Comments--We received two comments concerning these sections. These
commenters believed that the rule should provide for: (1) a longer than
20-day period for the recipient of a notice to file its request for a
hearing (preferably 40 days); (2) a separate opportunity for a hearing,
even if no request for a hearing is made from the notice of
noncompliance; (3) a mechanism for expedited review when there is a
request for a stay to allow substantive review without the risk of
incurring penalties; and (4) more specific regulatory criteria for
determining the amount of penalties. The commenters reasoned that the
purposes of 30 U.S.C. 1719, as well as all of FOGRMA, are to encourage
voluntary compliance, and imply that the rule, as proposed, violates
due process.
Response--Starting with how we determine the amount of penalties,
we do not believe that it is necessary to provide the detailed
standards for setting penalty amounts in regulatory form. MMS has
written guidelines which set out, in ranges, appropriate penalties for
a variety of circumstances. We do not believe it is possible to set out
all the standards in advance in a permanent fashion by rule. FOGRMA
requires only that ``In determining the amount of such penalty, or
whether it should be remitted or reduced, and in what amount, the
Secretary shall state on the record the reasons for his
determinations.'' 30 U.S.C. 1719(i). This subsection neither requires,
nor implies, that the determination be made through regulation, which
would limit the flexibility of DOI in setting penalty amounts
appropriate to the wide variety of possible circumstances that should
be considered. However, to assist potential recipients of notices of
noncompliance, the following table shows the current non-binding
guidelines MMS uses:
------------------------------------------------------------------------
Company size
Violation ----------------------------
Minor Moderate Major
------------------------------------------------------------------------
Failure to report.......................... $0-10 $0-25 $5-500
Failure to pay............................. 0-20 2-50 10-500
Failure to provide information............. 0-100 2-200 20-500
Failure to comply with order to perform 0-15 2-35 10-500
restructured accounting...................
------------------------------------------------------------------------
Note: Amounts in Dollars per violation per month.
We also believe that the current regulations of the Hearings
Division of the Office of Hearings and Appeals at 43 CFR 4.21 have
proven more than adequate when an appellant petitions for a stay. We
have used these procedures for 15 years without any complaints about an
appellant's inability to have its petition timely and fairly reviewed
by the Hearings Division. We therefore will not change the procedures
to mandate a faster review of requests for stays of accrual of
penalties.
As to the commenter's first two requests, FOGRMA grants the
Secretary the discretion to set the time limits for an appellant to
request a hearing. MMS has operated under rules requiring hearings to
be requested within 20 days of the date of receipt of the notice of
noncompliance for more than 15 years without complaint. In spite of
this history, in the interests of increasing a violator's ability to
request hearings, we have changed the proposed rule to allow 30 days
from the date of receipt of the notice of noncompliance for an
appellant to request a hearing on the record. MMS has a long history of
using a 30-day period in other contexts (specifically for appeals from
MMS orders), which allows ample time for appellants to decide whether
to seek review in those cases.
We agree with the comment that the violator may still have need for
redress concerning the amount of a civil penalty even though that
violator did not contest the notice of noncompliance. We therefore have
added new sections 241.56 and 241.64 that allow a violator, who did not
request a hearing on the record on a notice on noncompliance, 10 days
from the receipt of the Notice of Civil Penalty to request a hearing on
the record limited to the issue of the amount of the penalty only. By
not requesting a hearing on the record on the notice of noncompliance,
the recipient waived the right to contest the underlying liability for
penalties.
Section 241.60 May I Be Subject to Penalties Without Prior Notice and
an Opportunity to Correct?
Section 241.61 How Will MMS Inform Me of Violations Without a Period
To Correct?
Section 241.62 How May I Request a Hearing on the Record on a Notice
of Noncompliance Regarding Violations Without a Period To Correct?
Section 241.63 Does My Request for a Hearing on the Record Affect the
Penalties?
Comments--We received one set of comments that addressed these
sections concerning penalties that may begin without a period to
correct. The first issue involves the definition of violation. The
commenter referred to FOGRMA, which provides for an
[[Page 26243]]
assessment of $25,000 per day for each day such violation continues.
The commenter believes that MMS has been inconsistent by specifying a
penalty calculated at $25,000 per day for each violation. The second
issue is similar to the comments on sections 241.52 through 241.54 in
that no separate right of review is granted as to the amount of the
penalty and that the time to seek review is too short.
We also received one comment that addressed a statement in the
preamble that MMS believes that the statutory provision for assessing
penalties for ``failure to permit entry, inspection or audit'' applies
to failure to provide MMS with documents that MMS has requested under
authority of FOGRMA, the regulations or the leases. The commenter noted
that MMS has argued in court that audit requests are voluntary and, for
that reason, that they are not appealable agency actions. The commenter
continued by saying that argument is inconsistent with making lessees
subject to FOGRMA penalties without opportunity to correct for not
complying with audit requests.
Response--As we explained in the response to comments on section
241.50, we believe MMS has been very clear over the past decade and
one-half that each failure to comply with the mandates of law is a
separate violation. We believe that while FOGRMA uses the word ``such''
rather than ``each,'' their meaning is identical in the context of this
regulation. ``Such is a demonstrative word used to indicate the quality
or quantity of a thing * * *.'' The definition of ``each'' is ``Every
(individual of a number) regarded or treated separately.'' The Compact
Edition of the Oxford English Dictionary 823 Vol I and 3136, Vol. II
(1971). In both cases the word signifies a quantity. In the context of
FOGRMA, there is a separate violation, and thus a separate penalizable
act with a separately accruing penalty, for each such violation. The
regulation's meaning is identical to the statute's meaning.
As to the potential problem with a person wanting to appeal only
the amount of the penalty, we have added a provision at section 241.64
allowing a hearing on that issue alone, paralleling the new section
241.56.
We continue to believe there are circumstances where a refusal to
provide MMS, or a delegated State, or a Tribe operating under a
cooperative agreement (or under a self-determination contract or
compact), with documents during an audit would amount to a failure to
permit lawful audit. The exact circumstances under which MMS may use
this provision will be addressed in future proceedings when MMS
believes an appropriate case has arisen.
Section 241.70 How Does MMS Decide What the Amount of the Penalty
Should Be?
Comment--One comment was received that complained that the criteria
articulated for determining the quantum of civil penalty are
inadequate. The commenter demanded that more specific criteria be
articulated to provide a reviewing officer and a court more objective
criteria for determining the exercise of the agency's authority.
Response--MMS has operated under provisions similar to these for 15
years without complaint. Neither Administrative Law Judges, the
Interior Board of Land Appeals, nor the Federal courts found any need
for guidance in the form of a regulation. Indeed, FOGRMA only requires
``In determining the amount of such penalty, or whether it should be
remitted or reduced, and in what amount, the Secretary shall state on
the record the reasons for his determinations.'' 30 U.S.C. 1719(i). As
mentioned in the response to sections 241.53, 241.54 and 241.55, we
intend to continue to articulate our reasons as part of the
administrative record rather than attempting to do so in a rule.
Section 241.74 May I Seek Judicial Review of the Decision of the
Interior Board of Land Appeals?
Comment--One comment was received to the effect that the regulation
should include the 30 U.S.C. 1719(j) requirement that judicial review
must be taken in the United States District Court for the judicial
district in which the violation allegedly took place.
Response--We do not have the ability to determine jurisdiction or
venue, or other rules concerning review by Federal courts. We have
therefore simplified the regulation by making it a mere pointer to the
proper section of the United States Code. We have retained the sentence
informing the reader of the time limit to make it easier for readers of
these regulations to comply within the statutory time limit.
Section 241.75 When Must I Pay the Penalty?
Comment--One comment was received repeating the request for
separate review of the amount of the penalty.
Response--As mentioned above, we have added provisions allowing for
hearings on the record limited to the amount of penalty assessed.
Therefore, the paragraph within this section as proposed that
prohibited such reviews has been removed.
Section 241.77 How May MMS Collect the Penalty?
Comment--One comment was received that complained that MMS has no
statutory authority under FOGRMA for execution against a lease surety
or to offset amounts the United States owes to the violator.
Response--FOGRMA specifically provides for offset: ``The amount of
any penalty under this section, as finally determined may be deducted
from any sums owing by the United States to the person charged.'' 30
U.S.C. 1719(f). There is no specific statutory authority regarding
collecting against lease sureties. They fall under the plenary
regulatory authority of the Secretary under the mineral leasing laws.
This regulation is sufficient authority under those provisions.
V. Section-by-Section Analysis, 30 CFR Part 242
We have decided not to finalize part 242 as proposed on January 12,
1999, at this time. However, we have reserved this part for future
publication.
VI. Section-by-Section Analysis for 30 CFR Part 243 Suspensions
Pending Appeal and Bonding--Royalty Management
General comments--We received two sets of comments that addressed
this rule, one from an oil and gas producer and one from an association
of oil and gas companies. The producer's comments were favorable to the
proposed rule and referred to the association's comments for specific
suggestions.
The association also welcomed the proposed rule and MMS's proposal
to apply the rules even to situations where they are not mandated by
RSFA, such as production from periods prior to September 1996 and to
leases for minerals other than oil and gas. The commenter also
responded to the question about whether the rules should apply to
Indian leases as well as to Federal leases. That commenter stated that
it believed that the rules should apply to all appeals, because Indian
lessors as well as the Federal Government would be protected by the
financial solvency provisions.
Response--We appreciate the favorable comments on the proposal.
Upon considering the comment that the financial solvency provisions of
the proposed rule should apply to Indian as well as Federal leases, we
have decided that there are important reasons for having different sets
of rules for Indian
[[Page 26244]]
and Federal leases. First, Indian lessors are not in a comparable
position to the United States in their ability to absorb the risk of
default by a person believed to be financially solvent but who later
defaults on an appealed obligation. Indian lessors are much smaller,
less diversified in their portfolio of risks than the United States,
and are in a significantly less advantageous position than the United
States. Second, the standards that we apply, and must apply, to Indian
leases are different from those applied to Federal leases. We have a
trust responsibility to Indian lessors and believe that requiring the
protection of sureties for appeals of obligations on Indian leases is
appropriate. Finally, Congress declined to extend the benefit of self-
bonding by demonstration of financial solvency to lessees on Indian
lands. For these reasons, we will keep the separation between Indian
and Federal leases as it was in the proposed rule.
Section 243.3 What Definitions Apply to This Part?
Section 243.4 How Do I Suspend Compliance With an Order?
Comment--One commenter requested that definitions follow the RSFA
definitions. In particular, ``order'' does not appear to include
anything other than orders to pay monetary obligations. Therefore the
rules seem only to permit the suspension of these orders.
Response--The purpose of the use of the word ``order'' in this part
is to refer to the proper parts under which an appeal may be taken for
which compliance may be suspended under this part. To avoid confusion
we have deleted the reference to monetary obligation. We have clarified
section 243.4 to provide that appeals of orders that do not require the
making of a payment may be suspended without posting a surety or
demonstrating financial solvency.
Section 243.5 May Another Person Post a Bond or Other Surety
Instrument or Demonstrate Financial Solvency on My Behalf?
Comment--One commenter responded to our request for comments on
whether any limitations are needed on who may post surety or
demonstrate financial solvency on behalf of an appellant. That
commenter does not believe any limitations are appropriate.
Response--We appreciate the comment, and we believe that the phrase
``any other person'' clearly places no limitation on who may post
surety or demonstrate financial solvency on a lessee's behalf.
Therefore, we have decided to leave the rule as proposed.
Section 243.6 When Must I or Another Person Meet the Bonding or
Financial Solvency Requirements Under This Part?
Comment--One commenter believes this section should be amended to
make it clear that only one bond or demonstration of financial solvency
is required for any particular liability. The commenter does not
believe MMS should require sureties from a lessee and its designee for
the same liability. While the commenter believes, from our explanation
in the preamble to the proposed rule, that only one guarantee is
intended, it believes the rule itself should make clear that either the
lessee or the designee, but not both, is required to post surety or
demonstrate financial solvency.
Response--We have inserted the word either in this section to
clarify that only one surety is required, regardless of the identity of
the person or persons posting the surety or sureties.
Section 243.8 When Will MMS Suspend My Obligation To Comply With an
Order?
Comment--One commenter applauded MMS's proposal to increase the
minimum amount under appeal for which no bond or demonstration of
financial solvency is required. It urged that the same rules apply to
appeals with respect to Federal and Indian lands.
Response--As explained above, we believe it is appropriate to have
different standards with respect to Federal and Indian lands, and we
decline to change the standards here.
Section 243.10 When Will MMS Initiate Collection Actions Against a
Bond or Other Surety Instrument or a Person Demonstrating Financial
Solvency?
Comment--One commenter noted that the time period for MMS to
initiate collection actions against the bond or other surety is
inconsistent with the Mineral Leasing Act, 30 U.S.C. 226-2, which
allows 90 days for an appellant to seek judicial review of an adverse
decision by the Department. The proposed rule, by contrast, allowed MMS
to call on the surety within 30 days of such an adverse decision.
Response--We agree that the proposed rule should track the time
period in the Mineral Leasing Act with respect to oil and gas leases
for cases in which there is a decision of the IBLA or an Assistant
Secretary that is subject to judicial review. We therefore have
increased the time to 90 days in the final rule for those cases.
Section 243.11 May I Appeal the MMS Bond-Approving Officer's
Determination of My Surety Amount or Financial Solvency?
Comment--One commenter noted that it did not object to the proposal
that there would be no administrative review of determinations of the
Bond-Approving Officer, but requested that we clarify that the
determinations are judicially reviewable.
Response--Whether a court would have jurisdiction to review these
determinations is a matter of statute rather than regulation.
Therefore, we are not amending the rule to specifically provide for
judicial review.
Section 243.12 May I Substitute a Demonstration of Financial Solvency
for a Bond Posted Before the Effective Date of this Rule?
Comment--One commenter urged that this section be amended to allow
an appellant to replace a surety with a self-bond at any time, not just
``when the surety instrument is due for renewal.'' The commenter's
reason was that an appellant may have many bonds due for renewal at
different times. ``Depending on the circumstances, it may be more
administratively convenient * * * to replace all of its bonds with a
demonstration of financial solvency at the same time.''
Response--It was not our intent to prevent an appellant from
choosing between replacing its sureties individually as they expire, or
replacing all sureties at once. To avoid confusion, we have amended
this section to allow replacement of sureties at administratively
convenient times.
Section 243.200 How Do I Demonstrate Financial Solvency?
Comment--One commenter noted that the proposed rule appears
inconsistent with the preamble. The preamble noted that MMS could
require updated financial statements to monitor demonstrations of
financial solvency if the demonstrator files for bankruptcy. The
regulatory language allows MMS to require updated financial statements
upon request. The commenter urged MMS to specify the circumstances,
other than bankruptcy filings, that might justify an appellant to
redemonstrate financial solvency.
Response--We did not intend to narrow the rule by the preamble. The
broader requirements of the rule will remain unchanged. We expect MMS
to very rarely request an updated financial statement, but we believe
the flexibility
[[Page 26245]]
is needed for circumstances that we cannot currently foresee.
VII. Section-by-Section Analysis 30 CFR Part 250
Comment--No comments were received on the proposed amendments to
part 250.
VIII. Section-by-Section Analysis 30 CFR Part 290
Subpart A--Offshore Minerals Management Appeals Procedures
Section 290.2 Who May Appeal?
Comment--One commenter asked if an appeal from an order issued by
an MMS Offshore Minerals Management (OMM) official would be appealable
under the new 43 CFR part 4 subpart J, which is designed for appeals
from orders issued by MMS Royalty Management Program (RMP) officials.
Another commenter asked if we could do away with the exclusions listed
in section 290.2.
Response--An order issued by an MMS OMM official is not appealable
under the new 43 CFR part 4 subpart J. To clarify this matter, section
290.2 will specify that your appeal to IBLA is under 43 CFR part 4
subpart E. Adding the reference to subpart E is consistent with section
290.8(a) and should clarify the fact that appeals from orders issued by
MMS OMM officials are appealed to IBLA under 43 CFR part 4 subpart E.
The RSFA rule of decision provisions made final in 43 CFR part 4
subpart J do not apply to appeals of OMM orders.
Also, because we are not publishing a final rule on a new royalty
appeals process at this time, we are dividing part 290 into two
subparts to distinguish between appeals from orders issued from MMS's
RMP and orders issued from MMS's OMM Program. Appeals of OMM orders
will be under the rule at 30 CFR part 290 subpart A. Appeals of RMP
orders will be under 30 CFR part 290 subpart B.
As for doing away with the exclusions listed in section 290.2, the
exceptions listed for decisions concerning lease bids and deep water
field determinations are based on current requirements in other
sections of our rules (the sections were referenced in the proposed
rule). The changes proposed to the current OMM appeals process were
aimed at streamlining and simplifying the appeals process and do not
affect any other MMS rules or requirements.
Section 290.5 How do I Pay My Processing Fee?
Section 290.6 How Will MMS Notify Me of Its Action on my Request?
Section 290.7 What is the Filing Date for My Appeal?
Comment--We received numerous comments criticizing the complexity
of the proposed appeals rule.
Response--We believe it would be desirable to simplify this OMM
appeals rule by removing the provisions in sections 290.5, 290.6 and
290.7 of the proposed rule.
We are deleting the requirement to pay the processing fee by
electronic funds transfer, based upon conversations with officials in
the Treasury Department. Therefore, you may pay by following the
procedures in place at 30 CFR 218.51. We are also removing the parts
dealing with a waiver of the $150 processing fee imposed on each
appeal. The operators on the Outer Continental Shelf (OCS) are large
enough that they would not be able to justify the need for a waiver of
a $150 processing fee for their appeal. Also, because the amount of the
fee is nominal, the waiver provision in the proposed rule is not needed
to meet the requirements of the Small Business Regulatory Enforcement
and Fairness Act or the Regulatory Flexibility Act.
The date the appeal is filed will continue to be, as in the past,
the date the Notice of Appeal is received in the OMM office. The
processing fee will be paid by check with the Notice of Appeal.
Subpart B--Appeals of Royalty Management Program and Delegated State
Orders
Comments--We received no comments on this subpart because it was
not separately proposed. The revisions made in this subpart incorporate
portions of the proposed appeals rule that are necessary to implement
certain provisions of RSFA, and to separate appeals of royalty-related
orders from appeals of Offshore Minerals Management Program orders. The
OMM-related appeals are few in number and under the new subpart A will
go directly to the IBLA. We did receive comments on some of the
definitions in the proposed appeals rule that are contained in this
part. The revisions made in this subpart also rewrite the headings in
former part 290 in ``plain language,'' and clarify portions of former
part 290.
In addition, we deleted former section 290.4 titled ``Oral
Argument'' because they were rarely requested and rarely granted. This
is also consistent with the proposed rule which did not provide for
appellants to request oral argument before the IBLA.
Section 290.100 What is the Purpose of This Subpart?
Comments--We did not receive any comments on this section.
Response--The purpose of this subpart is to provide the procedures
to appeal MMS or delegated State orders concerning reporting to the
MMS's RMP and the payment of royalties and other payments due under
leases subject to this subpart. Subpart A of this part applies to
appeals of MMS's OMM program actions.
Section 290.101 What Leases Are Subject to This Subpart?
Comments--We received no comments on this subpart.
Response--This section is the same as proposed 43 CFR 4.902. We
specifically note that the scope of this subpart is not limited to
those orders that are subject to RSFA time of decision requirements in
30 U.S.C. 1724(h). This subpart covers all appeals of RMP or delegated
State orders, including orders concerning Federal leases for minerals
other than oil and gas, all Indian leases, orders to provide
information, produce documents, etc., and is not limited to Federal oil
and gas leases. Included in this subpart are some provisions specific
to orders that RSFA covers.
Section 290.102 What Definitions Apply to This Subpart?
Comments--This section contains definitions that are similar to
those found in proposed 43 CFR 4.903, for which we received comments to
which we respond in our preamble discussion of 43 CFR part 4 subpart J
in this final rulemaking. Please refer to the comments and responses to
definitions in that subpart in this preamble. There are some
differences in definitions because 43 CFR part 4 subpart J applies only
to orders that are subject to RSFA time of decision and rule of
decision requirements. The coverage of this subpart, in contrast, is
broader. Those differences are apparent from the text of the
definitions. For definitions included in this part that are not in 43
CFR part 4 subpart J there were no comments.
Section 290.103 Who May File an Appeal?
Comments--We received no comments on this section.
Response--We retained the requirement formerly found at 30 CFR
290.2 that you may appeal an order you receive if it adversely affects
you or your lessee. We also added the provision
[[Page 26246]]
proposed as 43 CFR 4.904(b) allowing lessees that receive a Notice of
Order to either appeal the order or join in their designee's appeal
under Sec. 290.106.
Section 290.104 What May I Not Appeal Under This Subpart?
Comments--We received no comments on this section.
Response--This addition to this subpart was proposed as 43 CFR
4.905(a) and (c).
Section 290.105 How Do I Appeal an Order?
Comments--We received no comments on this section.
Response--We combined the requirements found in former 30 CFR
290.3, 290.5 and 290.6, and rewrote them in plain language. We also
eliminated 30 CFR 290.3(b) which required a field report. This is
consistent with the agency's and industry's desire to accelerate the
appeals process.
Section 290.106 How Do Lessees Join a Designee's Appeal and What is
the Effect of Joinder?
Comments--We received no comments on this section.
Response--This section was proposed as 43 CFR 4.908. We made minor
changes necessary to reflect that the appeal is to the MMS Director
under this part, not the Office of Hearings and Appeals.
Section 290.107 Where are the Rules Concerning the Effect of the
Department Not Issuing a Decision in My Appeal Within the Statutory
Time Frame?
Comments--We received no comments on this section.
Response--This section was necessary to direct appellants to the
rules concerning the effect of DOI not issuing a decision in your
appeal within the 33-month period prescribed under 30 U.S.C. 1724(h).
Those rules are located in 43 CFR part 4 subpart J.
Section 290.108 How Do I Appeal to the IBLA?
Comments--We received no comments on this section.
Response--This section was the former 30 CFR 290.7. We added a
provision that directs appellants to 43 CFR part 4 subpart E.
Section 290.109 How Do I Request an Extension of Time?
Comments--See preamble discussion of 43 CFR 4.909.
Response--See preamble discussion of 43 CFR 4.909. This section was
proposed as 43 CFR 4.958. We made minor changes necessary to reflect
that the appeal is to the MMS Director under this part, not OHA, and to
differentiate those appeals that involve extensions of the RSFA time of
decision requirements from those that do not.
Department Hearings and Appeals Procedures
IX. Section-by-Section Analysis, 43 CFR Part 4--
Subpart J--Special Rules Applicable to Appeals Concerning Federal
Oil and Gas Royalties and Related Matters
Section 4.901 What Is the Purpose of This Subpart?
Comments--We did not receive any comments on this section.
Response--Even though we did not receive any comments on this
section, we must amend the text because we are not finalizing the
entire proposed rule at this time. The purpose of this subpart is
revised to explain how the time limits of 30 U.S.C. 1724(h) apply to
appeals subject to this subpart.
Section 4.902 What Appeals are Subject to This Subpart?
Comments--In the proposed rule, this section heading read, ``What
leases are subject to this subpart?'' We received no comments on that
section.
Response--Even though we did not receive any comments on this
section, we must amend the text because we are not finalizing the
entire proposed rule at this time. The section heading is changed to
read, ``What appeals are subject to this subpart?'' We had to change
the heading and content of this section to make clear what appeals this
subpart applies to because the sole purpose of this subpart is to
implement the time limits and rule of decision of 30 U.S.C. 1724(h).
Because section 1724(h) only applies to appeals of orders involving
Federal oil and gas leases, this section will state that the subpart
applies only to appeals of orders or portions of orders involving the
payment of royalties and other payments due, and the taking or delivery
of royalty in kind, under Federal oil and gas leases. Moreover, it
would make clear that its provisions apply to appeals to the MMS
Director under 30 CFR part 290 before this rule became effective,
appeals to the MMS Director under new 30 CFR part 290 subpart B after
this rule became effective, and appeals to the IBLA under 43 CFR part 4
subpart E, both before and after the effective date of this rule. This
section further specifies that this subpart does not apply to appeals
of orders (or portions of orders) that involve Indian leases or Federal
leases for minerals other than oil and gas, or that relate to Federal
oil and gas leases but do not involve a monetary or nonmonetary
obligation.
Section 4.903 What Definitions Apply to This Subpart?
Comments--We received several comments that the definition of
``lessee'' in the proposed rule should quote the definition in RSFA.
The commenters believed that it was inconsistent with RSFA to define
lessees to include persons to whom a lease interest is assigned.
Response--In the proposed rule, we decided not to quote the exact
definition of ``lessee'' found in RSFA because the proposed rule
applied to more than oil and gas leases subject to RSFA. Moreover, we
do not believe that the additional language in the proposed rule is
inconsistent with RSFA. The RSFA definition states that ``lessee''
includes ``any person to whom operating rights have been assigned.''
The proposed rule defines ``lessee'' to include ``any person to whom
all or part of the lessee's interest or operating rights in a lease
subject to this subpart has been assigned.'' We do not believe that it
is inconsistent with RSFA, or any law, to define a ``lessee'' as a
person to whom all or part of the lessee's interest has been
``assigned,'' or, in other words, to whom all or part of the lessee's
interest has been sold. To the contrary, it would be inconsistent with
RSFA and prevailing law and regulations to state that assignees of
leases are not lessees. Therefore, we are not changing the definition
of ``lessee'' in the proposed rule.
Comments--We received several comments on the definition of
``monetary obligation'' in the proposed rule. Commenters for the State
of California Controller's Office felt that the proposed definition
``invited dispute'' over what an ``issue'' is, because ``a particular
underpayment may be attributable to overlapping regulatory
violations.'' Thus, the California Controller's Office suggested that
it would be more administratively efficient if a monetary obligation
was defined as the total amount stated or estimated in the order.
Another commenter stated that the plain meaning of monetary is
``payable in money,'' and by including orders to recalculate royalties,
DOI is ``attempting to circumvent'' the default decision provisions of
30 U.S.C. 1724(h). Finally, two commenters believe that RSFA requires
us to define monetary obligation as ``the principal amount due on each
lease for each month'' because
[[Page 26247]]
that is what is required under the RSFA definition of an ``order to
pay.''
Response--With respect to the California Controller's Office's
comment that ``monetary obligation'' should be defined as the total
amount of underpayments in an order, we do not believe that the
definition was confusing. We believe that because orders identify the
specific regulatory violation and the associated underpayment, there
should be no confusion. For example, if an order stated an underpayment
amount attributable to a lessee's failure to include tax reimbursements
in its gross proceeds, and stated another underpayment amount
attributable to an improper deduction from the lessee's gross proceeds,
we believe it is clear that although both violations involve the gross
proceeds rule, they stem from different issues and involve separate
underpayments, and thus it is reasonable to consider them to be
separate obligations.
We disagree with the inference drawn by the commenter who asserted
that the only interpretation of ``monetary'' is ``payable in money.''
We are not attempting to circumvent the default decision provisions of
section 1724(h) by including orders to recalculate and pay in the
definition of monetary obligation. First, as we stated in the preamble
to the proposed rule, Congress did not define ``monetary.'' However,
both Webster's Dictionary and Black's Law Dictionary define monetary as
``related to'' money. We believe that orders to recalculate and pay are
clearly related to money, and include a requirement to pay money, and
as such are ``monetary'' in nature. Second, the only ``obligation'' of
a lessee under RSFA that is nonmonetary, and not ``related to money''
is a lessee's duty to deliver royalty in kind. Therefore, we are not
amending this definition to state that monetary obligations do not
include orders to recalculate and pay.
We also disagree with the comments that because RSFA defines an
``order to pay'' as a written order that ``specifically identifies the
obligation by lease, production month and monetary amount of such
obligation'' we must define monetary obligation the same way. As stated
above, Congress did not define monetary obligation. Congress did,
however, define ``obligation.'' Under RSFA, an ``obligation'' is a
specified lessee duty ``which arises from or relates to any lease * * *
or any mineral leasing law * * * *'' 30 U.S.C. 1702(25)(B). Therefore,
we disagree with the commenters that an obligation must be limited to
one lease. We also do not agree that an obligation must be limited to
one month. Rather, RSFA implies that an ``obligation'' may be issue-
specific (``related to any mineral leasing law,'' which includes
regulations). Accordingly, we are not changing the proposed definition
of monetary obligation in the manner the commenter requests.
We are revising the definition of monetary obligation as proposed
to clarify that monetary obligation also includes the Secretary's duty
to pay, refund, offset, or credit the amount of any obligation that a
lessee, designee, or payor has asserted in a request for payment,
refund, offset, or credit that MMS or a delegated State has denied.
This follows from the definitions of ``demand'' and ``obligation'' in
the new 30 U.S.C. 1702(23)(B) and (25)(A)(ii) as added to FOGRMA by
RSFA section 2, 110 Stat. 1701. Administrative appeals of denials of
requests by lessees, designees, or payors for refund, offset, credit,
etc., are subject to the RSFA time of decision and rule of decision
requirements of 30 U.S.C. 1724(h), which covers both ``demands'' and
``orders issued by the Secretary or a delegated State'' that are
``subject to administrative appeal in accordance with the regulations
of the Secretary.''
Comments--Several commenters objected to our decision to include
subsection (2)(i) in the definition of ``order'' which states that
orders do not include nonmandatory valuation determinations. Some
commenters felt that defining a valuation determination that does not
have mandatory or ordering language to not be an appealable ``order''
conflicts with other sections of MMS valuation regulations that allow
lessees to request valuation determinations, such as 30 CFR 206.257(f).
The commenters felt that under the current regulations, all valuation
determinations must be mandatory. One commenter stated that the
definition creates ``two types of valuation determinations, those that
contain mandatory or ordering language and those that do not. Only
those that contain mandatory or ordering language would be
appealable.'' We received similar comments regarding our proposal to
make nonmandatory policy determinations non-appealable. One commenter
stated that subpoenas that do not meet the requirements of 30 U.S.C.
1724(d)(2) should be appealable.
Response--We have provided that an order is appealable only when
the document ``contains mandatory or ordering language''--in other
words, when the disputed legal issues and the facts involved are
sufficiently definite to allow for meaningful adjudication. As we
stated in the proposed rule, we do not consider advice or guidance
contained in a nonmandatory valuation determination to be an ``order''
because it does not compel anyone to take particular action. Likewise,
general policy guidance contained in a letter to payors does not
contain mandatory language requiring lessees to do anything. If the
advice or guidance does not require the lessee to do anything, there is
nothing to appeal.
For example, it is possible for a lessee to first receive a ``Dear
Payor'' letter or valuation determination with general advice, next a
request or subpoena for documents that would enable the Government to
evaluate whether the lessee has followed that advice, and, finally, an
order applying the Government's understanding of the law and facts that
could be tested in an administrative appeal. Lastly, we do not believe
that making nonmandatory valuation determinations non-appealable
conflicts with other valuation regulations. Those regulations allow
lessees to request a valuation determination. If MMS issues a binding
determination under those rules in response to the request, then such a
determination is appealable. Therefore, for the reasons explained
above, we are not changing the definition of order to make nonmandatory
advice and guidance appealable.
We disagree with the comment that we should define subpoenas as
being appealable orders. As we stated in the preamble, subpoenas are
enforceable directly by the United States Government in Federal
district court under 30 U.S.C. 1717(b), and are not subject to
administrative appeal. Nothing in section 1724(d)(2) changes that fact.
Therefore, they also are not appealable ``orders,'' and we are not
changing the rule as the commenter suggested.
Because the purpose of this subpart is to implement the RSFA
decision deadlines and rules of decision in 30 U.S.C. 1724(h)(1) and
(2), and is not part of a general appeals provision as proposed, we
have narrowed the definition of ``order'' for purposes of this subpart
only. That definition makes clear that orders under this subpart are
only those orders that involve either monetary obligations or
nonmonetary obligations under Federal oil and gas leases and therefore
subject to 30 U.S.C. 1724(h)(1) and (2) as enacted by RSFA.
We also have revised the proposed definition of order to clarify
that order does not include a Notice of Noncompliance or Notice of
Civil Penalty issued under the provisions of FOGRMA section 109, 30
U.S.C. 1719, and implementing regulations at 30 CFR
[[Page 26248]]
part 241. Nor does order include a decision of an administrative law
judge following a hearing on the record on a Notice of Noncompliance or
Notice of Civil Penalty under FOGRMA section 109(e), 30 U.S.C. 1719(e),
and associated regulations. Likewise, order does not include a decision
of the IBLA on appeal from a decision of an administrative law judge
following a hearing on the record. This follows from the first sentence
of 30 U.S.C. 1724(h)(1), which establishes that the RSFA time of
decision and rule of decision requirements cover ``demands or orders
issued by the Secretary or a delegated State'' that are ``subject to
administrative appeal in accordance with the regulations of the
Secretary.'' FOGRMA civil penalty assessments result from an entirely
different process that is prescribed separately by statute.
Civil penalty assessments do not result from administratively
appealable MMS or delegated State orders. Instead, FOGRMA section
109(e) prescribes that no civil penalty may be assessed until a person
has been given an opportunity for a ``hearing on the record''--i.e., a
formal trial-type hearing before an administrative law judge, which
must be conducted under Administrative Procedure Act provisions at 5
U.S.C. 554, 556, and 557. The rules at 30 CFR part 241 implement the
statutory requirements of those sections regarding adjudication and
agency review.
It appears plain that Congress did not intend for the RSFA time of
decision and rule of decision requirements to cover FOGRMA civil
penalty proceedings. RSFA itself is primarily an amendment to FOGRMA
with respect to Federal leases. Had Congress intended to change the
statutory civil penalty procedures, it knew how to do so and could have
done so. There is no mention of any intent to include civil penalty
proceedings within the 30 U.S.C. 1724(h) requirements. Moreover, the
purpose of section 1724(h) was to address perceived problems with MMS's
administrative appeal process that are unrelated to civil penalty
proceedings.
Comment--We did not receive any comments on the definition of
``party.''
Response--Even though we did not receive any comments, we revised
the definition of ``party'' to delete the reference to persons who file
intervention briefs and to make other changes necessary to reflect that
we are not finalizing the entire proposed rule at this time.
Comments--We did not receive any comments on the definition of
``notice of an order.''
Response--Even though we did not receive any comments, we revised
the definition of ``notice of an order'' to delete the reference to 30
CFR part 242 because we are not finalizing that part of the proposed
rule at this time.
Comments--We received comments stating that we should include the
RSFA definition of ``demand'' in our final rule.
Response--We disagree. The portions of the proposed rule that we
are making final do not use the term ``demand.'' The substance of what
RSFA defines as a ``demand'' is encompassed within orders that are
subject to this subpart. Therefore, it is not necessary to define
``demand'' separately in this rule.
Section 4.904 When Does My Appeal Commence and End?
Comments--Several commenters suggested that an appeal should
commence, for purposes of calculating the beginning of the 33-month
period under section 1724(h)(1), on the date an MMS order is received
by the recipient. Some commenters stated that they believe that under
administrative law principles, an agency order that directs a person to
take action starts the person's appellate rights. Thus, they argue that
our definition of ``commence'' discourages an appellant from exercising
those rights and compromises administrative due process in order to
delay commencement of an appeal until we receive all of the items
required in the proposed rule. One commenter believes that the
definition for ``commencement'' under RSFA applies to the appeals
process.
Response--Although we are not finalizing the section of the
proposed rule that these comments were directed to at this time, the
comments are equally applicable to this section, which was proposed as
section 4.971. We recognize both that the MMS order is effective when
it is received and that a recipient may have to wait more than 33
months from that date for a decision by DOI because an appeal will not
commence under this rule until MMS receives the notice of appeal and
statement of reasons under former 30 CFR part 290, before the new
revised 30 CFR part 290 subpart B, promulgated with this rulemaking,
became effective. It is the recipient of the order who ``commences'' an
appeal, not DOI. Until DOI has received a Notice of Appeal, there is no
dispute to be adjudicated, and until DOI has received a Statement of
Reasons giving some reasons for the appellant's disagreement with the
order, it cannot evaluate whether the appellant's disagreement has any
merit. Because the recipient of the order controls when these items are
submitted, we believe it is a reasonable interpretation of section
1724(h)(1) that the 33-month period begins to run when MMS has received
at least minimally sufficient documentation to begin the process of
deciding the appeal. We also believe that this interpretation enhances
the decision-making process.
We have remedied this problem under the new 30 CFR part 290 subpart
B in section 290.109(b) and (c). Under the new subpart B, you may
request an extension of time to file your statement of reasons if you
agree to extend the RSFA time of decision requirement under 30 U.S.C.
1724(h)(1). (Under 30 CFR 290.105(b), there is no extension of time to
file a notice of appeal.) MMS recognizes that different amounts of time
may be necessary for appellants to prepare their written submissions in
different cases, depending on the number and complexity of issues, the
time needed to compile relevant facts and documents, etc. However, MMS
believes that additional time needed in more complicated cases should
not operate to the agency's prejudice. At the same time, it is in the
interest of all parties to know relatively early if a lessee or
designee plans to contest an order, and to provide a ``bright line''
for commencement of the appeal. Hence, after the effective date of the
new 30 CFR part 290 subpart B and this section, your appeal commences
for purposes of section 4.906 and 30 U.S.C. 1724(h) when you file your
notice of appeal. If you then need further time to prepare your
statement of reasons or briefs, you must agree to extend the 33-month
period prescribed in 30 U.S.C. 1724(h)(1).
Before the adoption of this rule, however, MMS received numerous
appeals in which various extensions of time to file statements of
reasons were granted, but in which a corresponding agreement by the
appellant to extend the RSFA 33-month period was not required and was
not automatic. Hence, for the reasons described above, MMS believes the
best reading of congressional intent is to regard the appeal as having
commenced for RSFA purposes at the later of the date the notice of
appeal was filed or the date the initial statement of reasons was
received.
If MMS were to adopt the commenters' suggestion that an appeal
``commenced'' when the order was received, several weeks, or even
months, of the 33-month period could be consumed without DOI being able
to either decide the order was correct or grant relief if it decided
otherwise. Especially in complicated cases, this
[[Page 26249]]
loss of time could seriously disadvantage DOI's ability to consider the
merits of the appeal.
Moreover, we believe the commenter has misconstrued RSFA's
definition of ``commencement.'' As explained in the preamble to the
proposed rule, RSFA did not define ``commencement'' for purposes of the
time of decision requirement in 30 U.S.C. 1724(h)(1) applicable to
``administrative proceedings.'' RSFA did define ``commence'' ``with
respect to a judicial proceeding'' and ``with respect to a demand.'' 30
U.S.C. 1702(20). However, the definition of ``commence'' under 1702(20)
clearly does not encompass ``administrative proceedings'' under 30
U.S.C. 1724(h) or 1702(18). Rather, ``commence'' under section 1702(20)
deals with the ``commencement'' of judicial proceedings or demands for
purposes of the RSFA 7-year limitations period under section 4(a), 30
U.S.C. 1724(b). Accordingly, it is necessary for us in this proposed
rule to define when your appeal ``commenced'' for purposes of section
1724(h).
We have therefore decided not to adopt the commenters' position.
Section 4.906 What If the Department Does Not Issue a Decision by the
Date My Appeal Ends?
Comments--The only comments received regarding this section as
proposed (section 4.956) (other than the comments regarding
``commenced'' and the definition of ``monetary obligation'' discussed
above) were from the solid minerals industry. The trade association
commenter and individual companies again requested that DOI make the
RSFA rule of decision in this section applicable to appeals involving
solid mineral leases.
Response--For the reasons set forth in the preamble to the proposed
rule, we have decided not to make this section applicable to solid
mineral leases. We do not believe that there is any benefit in imposing
a mandatory decision where DOI has not been statutorily directed to do
so.
We have, however, made changes necessary to reflect the fact that
we are not publishing the proposed rule in its entirety at this time.
Those changes would include provisions that refer to appeals to the MMS
Director under 30 CFR part 290 before 30 CFR part 290 subpart B became
effective, appeals to the MMS Director under the new 30 CFR part 290
subpart B (after this subpart became effective) and appeals to the IBLA
under 43 CFR part 4 subpart E, both before and after the effective date
of this subpart.
Section 4.908 What Is the Administrative Record for My Appeal If It Is
Deemed Decided?
Comments--We received no comments on this section.
Response--Even though we did not receive any comments, we made
changes necessary to reflect the fact that we are not finalizing the
entire proposed rule at this time. Those changes would include
provisions that refer to the record in appeals to the MMS Director
under 30 CFR part 290 before 30 CFR part 290 subpart B became
effective, appeals to the MMS Director under the new 30 CFR part 290
subpart B and the record in appeals to the IBLA under 43 CFR part 4
subpart E, both before and after the effective date of this rule.
Section 4.909 How Do I Request an Extension of Time?
Comments--We received one comment on this section (proposed section
4.958) from an industry representative and one from a trade
association. The industry commenter felt that the rule should grant
requests for extensions of time automatically, rather than leave it to
the discretion of the official to whom the request is submitted. The
trade association commenter felt that DOI should ``freely'' grant
requests. The commenter also felt that we should make clear that
parties could ask for extensions of time for any reason, including the
filing of pleadings.
Response--We agree that parties should be able to request
extensions of time for any reason, including for submissions of
pleadings. It was not our intent in the proposed rule to restrict such
requests. Therefore, to clarify that parties may request extensions for
any purpose, we modified this section by eliminating the language in
proposed paragraph (a) that stated parties could request an extension
``to meet any filing requirement under this subpart, or for DOI to
issue a final decision in your appeal.'' Section (a) now states:
If you are a party to an appeal subject to this subpart before
the IBLA, and you need additional time after an appeal commences for
any purpose, you may obtain an extension of time under this section.
With respect to the comment about automatic extensions, although we
expect that we will grant these requests liberally, we are not going to
bind future officials to granting automatic extensions by rule. RSFA
states that the 33-month period may be extended if the Secretary and
appellant agree in writing. We do not know what circumstances may exist
in any particular case that would lead us to not agree to a requested
extension.
IX. Procedural Matters
Regulatory Planning and Review E.O. 12866
This document is not a significant rule and is not subject to
review by the Office of Management and Budget under Executive Order
12866.
(1) This rule will not have an annual effect of $100 million or
more on the economy. It will not adversely affect in a material way the
economy, productivity, competition, jobs, the environment, public
health or safety, or State, local, or tribal governments or
communities. This rule does not require the payment of additional
revenues. This rule sets out how the Department will review MMS's
implementation of royalty and OCS operations policy.
(2) This rule will not create a serious inconsistency or otherwise
interfere with an action taken or planned by another agency. The
primary functions of appealable MMS orders are collecting royalties
from the minerals industry and regulating operations of mineral leases
on the OCS. Other agency functions do not cover these areas.
(3) This rule does not alter the budgetary effects or entitlements,
grants, user fees, or loan programs or the rights or obligations of
their recipients. The administrative appeals process has no impact on
or relation to grants, user fees, loan programs, or the rights and
obligations of their recipients.
(4) This rule does not raise novel legal or policy issues arising
out of legal mandates, the President's priorities, or the principles
set forth in E.O. 12866. This rule was developed in consultation with
States, tribes, and industry.
Regulatory Flexibility Act
The Department of the Interior certifies that this document will
not have a significant economic effect on a substantial number of small
entities under the Regulatory Flexibility Act (5 U.S.C. 601 et seq.).
Accordingly, a Small Entity Compliance Guide is not required.
This rule will affect three groups of individuals or companies: (1)
Indian lessors, (2) lessees and operators on offshore leases, and (3)
lessees, payors, and designees on Federal and Indian leases (onshore
and offshore). Indian lessors are either tribes or individuals.
However, Indian tribes are not considered to be small entities for the
purposes of the Regulatory Flexibility Act, and individuals do not fit
the definition of small entities. As for the remaining groups, the
majority of lessees, designees, payors, and operators on Federal and
Indian onshore leases would be classified as small businesses
[[Page 26250]]
according to the definitions in the Small Business Administration
Standard Industry Code (SIC). Changes in the rule that could have an
economic effect on these groups are the establishment of processing
fees for filing a Notice of Appeal and a Statement of Reasons (to the
extent that any small businesses are operating on the OCS), posting a
bond, and an increase in the maximum civil penalty to $25,000.
Bonding or payment is mandatory for appealed amounts above $10,000
on Federal leases and $1,000 for Indian leases. Appealed amounts less
than $10,000 for Federal and $1,000 for Indian leases do not require
bonding which typically provides relief to small entities. The ability
to demonstrate financial responsibility provides relief of credit
charges from surety companies.
The rule changes the maximum civil penalty to up to $25,000 per day
for those acts for which FOGRMA allows such a penalty. A larger penalty
should not have significant economic impacts because MMS assesses
penalties only when business operations have reached a very poor level
of conduct. Lessees and other payors may use a variety of remedies
including ADR before the assessment of a penalty.
Small Business Regulatory Enforcement Fairness Act (SBREFA)
This rule is not a major rule under 5 U.S.C. 804(2), the Small
Business Regulatory Enforcement Fairness Act. This rule:
a. Does not have an annual effect on the economy of $100 million or
more;
b. Will not cause a major increase in costs or prices for
consumers, individual industries, Federal, State, or local government
agencies, or geographic regions; and
c. Does not have significant adverse effects on competition,
employment, investment, productivity, innovation, or the ability of
U.S.-based enterprises to compete with foreign-based enterprises. This
is an administrative review process; there is no impact on these
things. The rule sets a time limit on when an appealed issue must be
resolved or decided, and gives relief from maintaining bonds in many
instances.
Unfunded Mandates Reform Act
This rule does not impose an unfunded mandate on State, local, or
tribal governments or the private sector of more than $100 million per
year. The rule does not have a significant or unique effect on State
local or tribal governments or the private sector. This rule does not
change the relationship between MMS, IBLA, and State, local, or tribal
governments. A statement containing the information required by the
Unfunded Mandates Reform Act (2 U.S.C. 1531 et seq.) is not required.
Takings (E.O. 12630)
In accordance with Executive Order 12630, the rule does not have
significant takings implications. The rule would not take away or
restrict an entity's right to appeal or bond orders received from MMS
or a delegated State. A takings implication assessment is not required.
Federalism (E.O. 12612)
In accordance with Executive Order 12612, the rule does not have
sufficient federalism implications to warrant the preparation of a
Federalism Assessment. The rule does not change the role or
responsibilities among Federal, State, and local governmental entities.
The rule does not relate to the structure and role of States and will
not have direct, substantive, or significant effects on States. A
Federalism Assessment is not required.
Civil Justice Reform (E.O. 12988)
In accordance with Executive Order 12988, the Office of the
Solicitor has determined that this rule does not unduly burden the
judicial system and meets the requirements of Secs. 3(a) and 3(b)(2) of
the Order. The rule has been reviewed and describes in clear language
what is allowed and what is prohibited. The IBLA and MMS have drafted
this rule in plain language and have consulted with the Department of
the Interior's Office of the Solicitor, RPC Subcommittee, States, and
tribes throughout the rulemaking process.
Paperwork Reduction Act
The Office of Management and Budget (OMB) approved the information
collection requirements contained in this rule under 44 U.S.C. 3501 et
seq., and assigned OMB Control Numbers 1010-0121 and 1010-0122. The
burden hours for the reporting requirements in 30 CFR part 290 are
approved under OMB Control Number 1010-0121. Under the Paperwork
Reduction Act, an agency may not conduct or sponsor, and a person is
not required to respond to, a collection of information unless it
displays a currently valid OMB Control Number. You may obtain a copy of
the information collections by contacting the Bureau's Information
Collection Clearance Officer at (202) 208-7744.
National Environmental Policy Act
This rule does not constitute a major Federal action significantly
affecting the quality of the human environment. A detailed statement
under the National Environmental Policy Act of 1969 is not required.
Clarity of This Regulation
Executive Order 12866 requires each agency to write regulations
that are easy to understand. We invite your comments on how to make
this rule easier to understand, including answers to questions such as
the following: (1) Are the requirements in the rule clearly stated? (2)
Does the rule contain technical language or jargon that interferes with
this clarity? (3) Does the format of the rule (grouping and order of
sections, use of headings, paragraphing, etc.) aid or reduce its
clarity? (4) Would the rule be easier to understand if it were divided
into more (but shorter) sections? (A ``section'' appears in bold type
and is preceded by the symbol ``Sec. '' and a numbered heading; for
example Sec. 4.904.) (5) Is the description of the rule in the
Supplementary Information section of the preamble helpful in
understanding the rule? What else could we do to make the rule easier
to understand?
Send a copy of any comments that concern how we could make this
rule easier to understand to: Office of Regulatory Affairs, Department
of the Interior, Room 7229, 1849 C Street NW, Washington, DC 20240. You
may also e-mail the comments to this address: Exsec@ios.doi.gov.
List of Subjects
30 CFR Part 208
Continental shelf, Government contracts, Mineral royalties,
Petroleum, Public lands--Mineral resources, Reporting and recordkeeping
requirements, Small businesses, Surety bonds.
30 CFR Part 241
Continental shelf, Government contracts, Indian lands, Mineral
royalties, Natural gas, Penalties, Petroleum, Public lands--Mineral
resources, Reporting and recordkeeping requirements.
30 CFR Part 243
Coal, Continental shelf, Geothermal energy, Government contracts,
Indian lands, Mineral royalties, Natural gas, Petroleum, Public lands--
Mineral resources, Surety bonds.
30 CFR Part 250
Continental shelf, Environmental impact statements, Environmental
protection, Government contracts, Incorporation by reference,
Investigations, Mineral royalties, Natural gas, Oil and gas development
and production, Oil and gas exploration,
[[Page 26251]]
Oil and gas reserves, Penalties, Petroleum, Pipelines, Public lands--
Mineral resources, Public lands--rights-of-way, Reporting and
recordkeeping requirements, Sulphur development and production, Sulphur
exploration, Surety bonds.
30 CFR Part 290
Administrative practice and procedure.
43 CFR Part 4
Administrative practice and procedures, Continental Shelf, Mineral
royalties, Natural Gas, Petroleum, Public Lands--mineral resources.
Sylvia V. Baca,
Acting Assistant Secretary--Land and Minerals Management.
John Berry,
Assistant Secretary for Policy, Management and Budget.
Kevin Gover,
Assistant Secretary for Indian Affairs.
For the reasons set out in the preamble, MMS and OHA are amending
30 CFR Parts 208, 241, 243, 250, and 290; reserving 30 CFR part 242 and
adding 43 CFR part 4, subpart J as follows:
TITLE 30--MINERAL RESOURCES
PART 208--SALE OF FEDERAL ROYALTY OIL
1. The authority citation for part 208 is revised to read as
follows:
Authority: 5 U.S.C. 301 et seq.; 30 U.S.C. 181 et seq., 351 et
seq., 1701 et seq.; 31 U.S.C. 9701; 41 U.S.C. 601 et seq.; 43 U.S.C.
1301 et seq., 1331 et seq., and 1801 et seq.
2. In Sec. 208.2, new definitions are added in alphabetical order
to read as follows:
Sec. 208.2 Definitions.
* * * * *
Contracting officer means the Director, his or her delegate, or the
person designated under a royalty oil purchase contract.
* * * * *
Contracting officer's decision means an MMS order or decision that
a contracting officer issues under this part to a purchaser of oil
under a royalty oil purchase contract.
* * * * *
3. Section 208.16 is revised to read as follows:
Sec. 208.16 How to appeal a contracting officer's decision that you
receive.
If you receive a contracting officer's decision, you may:
(a) Appeal that decision to the Board of Contract Appeals in the
Office of Hearings and Appeals, Office of the Secretary, in accordance
with the procedures provided in 43 CFR part 4, subpart C; or
(b) File an action in the United States Court of Federal Claims.
PART 241--PENALTIES
4. The authority citation for part 241 continues to read as
follows:
Authority: 25 U.S.C 396 et seq.; 25 U.S.C. 396a et seq.; 25
U.S.C. 2101 et seq.; 30 U.S.C. 181 et seq.; 30 U.S.C. 351 et seq.;
30 U.S.C. 1001 et seq.; 30 U.S.C. 1701 et seq.; 43 U.S.C. 1301 et
seq.; 43 U.S.C. 1331 et seq.; and 43 U.S.C. 1801 et seq.;
Sec. 241.20 [Removed]
5. Section 241.20 is removed and subpart A is reserved.
6. Subpart B is revised to read as follows:
Subpart B--Penalties for Federal and Indian Oil and Gas Leases
Definitions
241.50 What definitions apply to this subpart?
Penalties after a Period To Correct
241.51 What may MMS do if I violate a statute, regulation, order,
or lease term relating to a Federal or Indian oil and gas lease?
241.52 What if I correct the violation?
241.53 What if I do not correct the violation?
241.54 How may I request a hearing on the record on a Notice of
Noncompliance?
241.55 Does my request for a hearing on the record affect the
penalties?
241.56 May I request a hearing on the record regarding the amount
of a civil penalty if I did not request a hearing on the Notice of
Noncompliance?
Penalties Without a Period To Correct
241.60 May I be subject to penalties without prior notice and an
opportunity to correct?
241.61 How will MMS inform me of violations without a period to
correct?
241.62 How may I request a hearing on the record on a Notice of
Noncompliance regarding violations without a period to correct?
241.63 Does my request for a hearing on the record affect the
penalties?
241.64 May I request a hearing on the record regarding the amount
of a civil penalty if I did not request a hearing on the Notice of
Noncompliance?
General Provisions
241.70 How does MMS decide what the amount of the penalty should
be?
241.71 Does the penalty affect whether I owe interest?
241.72 How will the Office of Hearings and Appeals conduct the
hearing on the record?
241.73 How may I appeal the Administrative Law Judge's decision?
241.74 May I seek judicial review of the decision of the Interior
Board of Land Appeals?
241.75 When must I pay the penalty?
241.76 Can MMS reduce my penalty once it is assessed?
241.77 How may MMS collect the penalty?
Criminal Penalties
241.80 May the United States criminally prosecute me for violations
under Federal and Indian oil and gas leases?
Subpart B--Penalties for Federal and Indian Oil and Gas Leases
Definitions
Sec. 241.50 What definitions apply to this subpart?
The terms used in this subpart have the same meaning as in 30
U.S.C. 1702.
Penalties After a Period To Correct
Sec. 241.51 What may MMS do if I violate a statute, regulation, order,
or lease term relating to a Federal or Indian oil and gas lease?
(a) If we believe that you have not followed any requirement of a
statute, regulation, order, or terms of a lease for any Federal or
Indian oil or gas lease, we may send you a Notice of Noncompliance
telling you what the violation is and what you need to do to correct it
to avoid civil penalties under 30 U.S.C. 1719(a) and (b).
(b) We will send the Notice to your address of record as shown in
the following table:
--------------------------------------------------------------------------------------------------------------------------------------------------------
For notices of noncompliance to-- The addressee of record is-- And--
--------------------------------------------------------------------------------------------------------------------------------------------------------
(1) A refiner or other party involved The position title, department name and address, or individual name and The refiner or other party must notify
in disposition of Federal royalty address in the executed royalty sale contract; or a different position MMS in writing of all addressee
taken in kind. title, department name and address, or individual name and address changes.
that the refiner or other party under the executed royalty sale
contract identifies in writing for billing purposes; or an agent
designated in writing to receive notices of noncompliance.
[[Page 26252]]
(2) Any person required to report oil The most recent position title, department name and address, or The reporter/payor must notify RMP, in
or gas removed from Federal or Indian individual name and address that RMP has in its records for the writing, of any addressee changes.
leases to the RMP Production reporter/payor; or an agent designated in writing to receive notices
Accounting and Auditing System. of noncompliance.
(3) A lessee, designee, reporter or The position title, department name and address, or individual name and The lessee, designee, reporter or
payor whose records are subject to address the lessee, designee, reporter or payor identifies in writing payor must notify MMS of any
audit. at the initiation of the audit; or the most recent addressee that the addressee changes.
lessee, designee, reporter or payor specified in writing; or an agent
designated in writing to receive notices of noncompliance.
(4) A reporter reporting on the The most recent position title, department name and address, or The lessee, designee, reporter or
``Report of Sales and Royalty individual name and address that the lessee, designee, reporter or payor is responsible for notifying
Remittance'' (Form MMS-2014). payor identifies in writing; or an agent designated in writing to RMP in writing of any addressee
receive notices of noncompliance. changes.
(5) A lessee, designee, reporter or The most recent position title, department name and address, or The lessee, designee, reporter or
payor who remits rental and bonuses individual name and address maintained in RMP records; or an agent payor is responsible for notifying
from nonproducing Federal leases. designated in writing to receive notices of noncompliance. RMP in writing of any addressee
changes.
--------------------------------------------------------------------------------------------------------------------------------------------------------
(c) We will serve Notices of Noncompliance by using registered mail
or personal service.
Sec. 241.52 What if I correct the violation?
The matter will be closed if you correct all of the violations
identified in the Notice of Noncompliance within 20 days after you
receive the Notice (or within a longer time period specified in the
Notice).
Sec. 241.53 What if I do not correct the violation?
(a) We may send you a Notice of Civil Penalty if you do not correct
all of the violations identified in the Notice of Noncompliance within
20 days after you receive the Notice of Noncompliance (or within a
longer time period specified in that Notice). The Notice of Civil
Penalty will tell you how much penalty you must pay. The penalty may be
up to $500 per day, beginning with the date of the Notice of
Noncompliance, for each violation identified in the Notice of
Noncompliance for as long as you do not correct the violations.
(b) If you do not correct all of the violations identified in the
Notice of Noncompliance within 40 days after you receive the Notice of
Noncompliance (or 20 days following the expiration of a longer time
period specified in that Notice), we may increase the penalty to up to
$5,000 per day, beginning with the date of the Notice of Noncompliance,
for each violation for as long as you do not correct the violations.
Sec. 241.54 How may I request a hearing on the record on a Notice of
Noncompliance?
You may request a hearing on the record on a Notice of
Noncompliance by filing a request within 30 days of the date you
received the Notice of Noncompliance with the Hearings Division
(Departmental), Office of Hearings and Appeals, U.S. Department of the
Interior, 4015 Wilson Boulevard, Arlington, Virginia 22203. You may do
this regardless of whether you correct the violations identified in the
Notice of Noncompliance.
Sec. 241.55 Does my request for a hearing on the record affect the
penalties?
(a) If you do not correct the violations identified in the Notice
of Noncompliance, the penalties will continue to accrue even if you
request a hearing on the record.
(b) You may petition the Hearings Division (Departmental) of the
Office of Hearings and Appeals, to stay the accrual of penalties
pending the hearing on the record and a decision by the Administrative
Law Judge under Sec. 241.72.
(1) You must file your petition within 45 calendar days of
receiving the Notice of Noncompliance.
(2) To stay the accrual of penalties, you must post a bond or other
surety instrument using the same standards and requirements as
prescribed in 30 CFR part 243, subpart B, or demonstrate financial
solvency using the same standards and requirements as prescribed in 30
CFR part 243, subpart C, for the principal amount of any unpaid amounts
due that are the subject of the Notice of Noncompliance, including
interest thereon, plus the amount of any penalties accrued before the
date a stay becomes effective.
(3) The Hearings Division will grant or deny the petition under 43
CFR 4.21(b).
Sec. 241.56 May I request a hearing on the record regarding the amount
of a civil penalty if I did not request a hearing on the Notice of
Noncompliance?
(a) You may request a hearing on the record to challenge only the
amount of a civil penalty when you receive a Notice of Civil Penalty,
if you did not previously request a hearing on the record under
Sec. 241.54. If you did not request a hearing on the record on the
Notice of Noncompliance under Sec. 241.54, you may not contest your
underlying liability for civil penalties.
(b) You must file your request within 10 days after you receive the
Notice of Civil Penalty with the Hearings Division (Departmental),
Office of Hearings and Appeals, U.S. Department of the Interior, 4015
Wilson Boulevard, Arlington, Virginia 22203.
Penalties Without a Period To Correct
Sec. 241.60 May I be subject to penalties without prior notice and an
opportunity to correct?
The Federal Oil and Gas Royalty Management Act sets out several
specific violations for which penalties accrue without an opportunity
to first correct the violation.
(a) Under 30 U.S.C. 1719(c), you may be subject to penalties of up
to $10,000 per day per violation for each day the violation continues
if you:
(1) Knowingly or willfully fail to make any royalty payment by the
date specified by statute, regulation, order or terms of the lease;
(2) Fail or refuse to permit lawful entry, inspection, or audit; or
(3) Knowingly or willfully fail or refuse to notify the Secretary,
within 5 business days after any well begins production on a lease site
or allocated to a lease site, or resumes production in the case of a
well which has been off
[[Page 26253]]
production for more than 90 days, of the date on which production has
begun or resumed.
(b) Under 30 U.S.C. 1719(d), you may be subject to civil penalties
of up to $25,000 per day for each day each violation continues if you:
(1) Knowingly or willfully prepare, maintain, or submit false,
inaccurate, or misleading reports, notices, affidavits, records, data,
or other written information;
(2) Knowingly or willfully take or remove, transport, use or divert
any oil or gas from any lease site without having valid legal authority
to do so; or
(3) Purchase, accept, sell, transport, or convey to another person,
any oil or gas knowing or having reason to know that such oil or gas
was stolen or unlawfully removed or diverted.
Sec. 241.61 How will MMS inform me of violations without a period to
correct?
We will inform you of violations without a period to correct by
issuing a Notice of Noncompliance explaining what the violation is and
how to correct it. We also will send you a Notice of Civil Penalty
stating the amount of the penalty. The Notice of Noncompliance and
Notice of Civil Penalty may be issued simultaneously. We will send the
Notice of Noncompliance and the Notice of Civil Penalty to your address
of record under Sec. 241.51(b) using the means of service specified
under Sec. 241.51(c).
Sec. 241.62 How may I request a hearing on the record on a Notice of
Noncompliance regarding violations without a period to correct?
You may request a hearing on the record of a Notice of
Noncompliance regarding violations without a period to correct by
filing a request within 30 days after you receive the Notice of
Noncompliance with the Hearings Division (Departmental), Office of
Hearings and Appeals, U.S. Department of the Interior, 4015 Wilson
Boulevard, Arlington, Virginia 22203. You may do this regardless of
whether you correct the violations identified in the Notice of
Noncompliance.
Sec. 241.63 Does my request for a hearing on the record affect the
penalties?
(a) If you do not correct the violations identified in the Notice
of Noncompliance regarding violations without a period to correct, the
penalties will continue to accrue even if you request a hearing on the
record.
(b) You may ask the Hearings Division (Departmental) to stay the
accrual of penalties pending the hearing on the record and a decision
by the Administrative Law Judge under Sec. 241.72.
(1) You must file your petition within 45 calendar days after you
receive the Notice of Noncompliance.
(2) To stay the accrual of penalties, you must post a bond or other
surety instrument using the same standards and requirements as
prescribed in 30 CFR part 243, subpart B, or demonstrate financial
solvency using the same standards and requirements as prescribed in 30
CFR part 243, subpart C, for the principal amount of any unpaid amounts
due that are the subject of the Notice of Noncompliance, including
interest thereon, plus the amount of any penalties accrued before the
date a stay becomes effective.
(3) The Hearings Division will grant or deny the petition under 43
CFR 4.21(b).
Sec. 241.64 May I request a hearing on the record regarding the amount
of a civil penalty if I did not request a hearing on the Notice of
Noncompliance?
(a) You may request a hearing on the record to challenge only the
amount of a civil penalty when you receive a Notice of Civil Penalty
regarding violations without a period to correct, if you did not
previously request a hearing on the record under Sec. 241.62. If you
did not request a hearing on the record on the Notice of Noncompliance
under Sec. 241.62, you may not contest your underlying liability for
civil penalties.
(b) You must file your request within 10 days after you receive
Notice of Civil Penalty with the Hearings Division (Departmental),
Office of Hearings and Appeals, U.S. Department of the Interior, 4015
Wilson Boulevard, Arlington, Virginia 22203.
General Provisions
Sec. 241.70 How does MMS decide what the amount of the penalty should
be?
We determine the amount of the penalty by considering the severity
of the violations, your history of compliance, and if you are a small
business.
Sec. 241.71 Does the penalty affect whether I owe interest?
(a) The penalties under this part are in addition to interest you
may owe on any underlying underpayments or unpaid debt.
(b) If you do not pay the penalty by the date required under
Sec. 241.75(d), MMS will assess you late payment interest on the
penalty amount at the same rate interest is assessed under 30 CFR
218.54.
Sec. 241.72 How will the Office of Hearings and Appeals conduct the
hearing on the record?
If you request a hearing on the record under Secs. 241.54, 241.56,
241.62 or 241.64, the hearing will be conducted by a Departmental
Administrative Law Judge from the Office of Hearings and Appeals. After
the hearing, the Administrative Law Judge will issue a decision in
accordance with the evidence presented and applicable law.
Sec. 241.73 How may I appeal the Administrative Law Judge's decision?
If you are adversely affected by the Administrative Law Judge's
decision, you may appeal that decision to the Interior Board of Land
Appeals under 43 CFR part 4, subpart E.
Sec. 241.74 May I seek judicial review of the decision of the Interior
Board of Land Appeals?
Under 30 U.S.C. 1719(j), you may seek judicial review of the
decision of the Interior Board of Land Appeals. A suit for judicial
review in the District Court will be barred unless filed within 90 days
after the final order.
Sec. 241.75 When must I pay the penalty?
(a) You must pay the amount of the Notice of Civil Penalty issued
under Secs. 241.53 or 241.61, if you do not request a hearing on the
record under Sec. 241.54, Sec. 241.56, Sec. 241.62, or Sec. 241.64.
(b) If you request a hearing on the record under Sec. 241.54,
Sec. 241.56, Sec. 241.62, or Sec. 241.64, but you do not appeal the
determination of the Administrative Law Judge to the Interior Board of
Land Appeals under Sec. 241.73, you must pay the amount assessed by the
Administrative Law Judge.
(c) If you appeal the determination of the Administrative Law Judge
to the Interior Board of Land Appeals, you must pay the amount assessed
in the IBLA decision.
(d) You must pay the penalty assessed within 40 days after:
(1) You received the Notice of Civil Penalty, if you did not
request a hearing on the record under either Sec. 241.54, Sec. 241.56,
Sec. 241.62, or Sec. 241.64;
(2) You received an Administrative Law Judge's decision under
Sec. 241.72, if you obtained a stay of the accrual of penalties pending
the hearing on the record under Sec. 241.55(b) or Sec. 241.63(b) and
did not appeal the Administrative Law Judge's determination to the IBLA
under Sec. 241.73;
(3) You received an IBLA decision under Sec. 241.73 if the IBLA
continued the stay of accrual of penalties pending its decision and you
did not seek judicial review of the IBLA's decision; or
[[Page 26254]]
(4) A final non-appealable judgment of a court of competent
jurisdiction is entered, if you sought judicial review of the IBLA's
decision and the Department or the appropriate court suspended
compliance with the IBLA's decision pending the adjudication of the
case.
(e) If you do not pay, that amount is subject to collection under
the provisions of Sec. 241.77.
Sec. 241.76 Can MMS reduce my penalty once it is assessed?
Under 30 U.S.C. 1719(g), the Director or his or her delegate may
compromise or reduce civil penalties assessed under this part.
Sec. 241.77 How may MMS collect the penalty?
(a) MMS may use all available means to collect the penalty
including, but not limited to:
(1) Requiring the lease surety, for amounts owed by lessees, to pay
the penalty;
(2) Deducting the amount of the penalty from any sums the United
States owes to you; and
(3) Using judicial process to compel your payment under 30 U.S.C.
1719(k).
(b) If the Department uses judicial process, or if you seek
judicial review under Sec. 241.74 and the court upholds assessment of a
penalty, the court shall have jurisdiction to award the amount assessed
plus interest assessed from the date of the expiration of the 90-day
period referred to in Sec. 241.74. The amount of any penalty, as
finally determined, may be deducted from any sum owing to you by the
United States.
Criminal Penalties
Sec. 241.80 May the United States criminally prosecute me for
violations under Federal and Indian oil and gas leases?
If you commit an act for which a civil penalty is provided at 30
U.S.C. 1719(d) and Sec. 241.60(b), the United States may pursue
criminal penalties as provided at 30 U.S.C. 1720, in addition to any
authority for prosecution under other statutes.
8. The heading of part 242 is revised to read as follows.
PART 242--ORDERS [RESERVED]
9. Part 243 is revised to read as follows:
PART 243--SUSPENSIONS PENDING APPEAL AND BONDING--ROYALTY
MANAGEMENT PROGRAM
Subpart A--General Provisions
Sec.
243.1 What is the purpose of this part?
243.2 What leases are subject to this part?
243.3 What definitions apply to this part?
243.4 How do I suspend compliance with an order?
243.5 May another person post a bond or other surety instrument or
demonstrate financial solvency on my behalf?
243.6 When must I or another person meet the bonding or financial
solvency requirements under this part?
243.7 What must a person do when posting a bond or other surety
instrument or demonstrating financial solvency on behalf of an
appellant?
243.8 When will MMS suspend my obligation to comply with an order?
243.9 Will MMS continue to suspend my obligation to comply with an
order if I seek judicial review in a Federal court?
243.10 When will MMS collect against a bond or other surety
instrument or a person demonstrating financial solvency?
243.11 May I appeal the MMS bond-approving officer's determination
of my surety amount or financial solvency?
243.12 May I substitute a demonstration of financial solvency for a
bond posted before the effective date of this rule?
Subpart B--Bonding Requirements
243.100 What standards must my MMS-specified surety instrument
meet?
243.101 How will MMS determine the amount of my bond or other
surety instrument?
Subpart C--Financial Solvency Requirements
243.200 How do I demonstrate financial solvency?
243.201 How will MMS determine if I am financially solvent?
243.202 When will MMS monitor my financial solvency?
Authority: 5 U.S.C. 301 et seq.; 25 U.S.C. 396 et seq., 396a et
seq., 2101 et seq.; 30 U.S.C. 181 et seq., 351 et seq., 1001 et
seq., 1701 et seq.; 31 U.S.C. 9701; 43 U.S.C. 1301 et seq., 1331 et
seq., and 1801 et seq.
Subpart A--General Provisions
Sec. 243.1 What is the purpose of this part?
This part applies to you if you are a lessee or recipient of an
order. This part explains:
(a) How you may suspend compliance with an order that you (or your
designee if you are a lessee) have appealed under 30 CFR part 290 in
effect prior to May 13, 1999 and contained in the 30 CFR, parts 200 to
699, edition revised as of July 1, 1998, or under 30 CFR part 290,
subpart b; and
(b) When you or another person acting on your behalf must submit a
bond or other surety or demonstrate financial solvency.
Sec. 243.2 What leases are subject to this part?
This part applies to all Federal mineral leases onshore and on the
Outer Continental Shelf (OCS), and to all federally-administered
mineral leases on Indian tribal and individual Indian mineral owners'
lands.
Sec. 243.3 What definitions apply to this part?
Assessment means any fee or charge levied or imposed by the
Secretary or a delegated State other than:
(1) The principal amount of any royalty, minimum royalty, rental,
bonus, net profit share or proceed of sale;
(2) Any interest; or
(3) Any civil or criminal penalty.
Designee means the person designated by a lessee under Sec. 218.52
of this chapter to make all or part of the royalty or other payments
due on a lease on the lessee's behalf.
Lessee means any person to whom the United States, or the United
States on behalf of an Indian tribe or individual Indian mineral owner,
issues a lease, or any person to whom all or part of the lessee's
interest or operating rights in a lease has been assigned.
MMS bond-approving officer means the Associate Director for Royalty
Management or an official to whom the Associate Director delegates that
responsibility.
MMS-specified surety instrument means an MMS-specified
administrative appeal bond, an MMS-specified irrevocable letter of
credit, a Treasury book-entry bond or note, or a financial institution
book-entry certificate of deposit.
Notice of order means the notice that MMS or a delegated State
issues to a lessee that informs the lessee that MMS or the delegated
State has issued an order to the lessee's designee.
Order means an order appealable under 30 CFR part 290 in effect
prior to May 13, 1999 and contained in the 30 CFR, parts 200 to 699,
edition revised as of July 1, 1998, under 30 CFR part 290 subpart B, or
under 30 CFR part 208.
Person means any individual, firm, corporation, association,
partnership, consortium, or joint venture.
Sec. 243.4 How do I suspend compliance with an order?
(a) If you timely appeal an order, and if that order or portion of
that order:
(1) Requires you to make a payment, and you want to suspend
compliance with that order, you must post a bond or other surety
instrument or demonstrate financial solvency under this part, except as
provided in paragraph (b) of this section; or
(2) Does not require you to make a payment, compliance with that
order is
[[Page 26255]]
suspended when you meet all requirements to file that appeal.
(b) You need not meet the requirements of paragraph (a) of this
section if:
(1) The order is an assessment; or
(2) Another person agrees to fulfill these requirements on your
behalf under Sec. 243.5.
Sec. 243.5 May another person post a bond or other surety instrument
or demonstrate financial solvency on my behalf?
Any other person, including a designee, payor, or affiliate, may
post a bond or other surety instrument or demonstrate financial
solvency under this part on behalf of an appellant required to post a
bond or other surety instrument under Sec. 243.4(a)(1).
Sec. 243.6 When must I or another person meet the bonding or financial
solvency requirements under this part?
If you must meet the bonding or financial solvency requirements
under Sec. 243.4(a)(1), or if another person is meeting your bonding or
financial solvency requirements, then either you or the other person
must post a bond or other surety instrument or demonstrate financial
solvency within 60 days after you receive the order or the Notice of
Order.
Sec. 243.7 What must a person do when posting a bond or other surety
instrument or demonstrating financial solvency on behalf of an
appellant?
If you assume an appellant's responsibility to post a bond or other
surety instrument or demonstrate financial solvency under Sec. 243.5,
you:
(a) Must notify MMS in writing at the address specified in
Sec. 243.200(a) that you are assuming the appellant's responsibility
under this part;
(b) May not assert that you are not otherwise liable for royalties
or other payments under 30 U.S.C. 1712(a), or any other theory, as a
defense if MMS calls your bond or requires you to pay based on your
demonstration of financial solvency; and
(c) May end your voluntarily-assumed responsibility for posting a
bond or other surety instrument only after the appellant under this
part either:
(1) Pays or posts a bond or other surety instrument; or
(2) Demonstrates financial solvency.
Sec. 243.8 When will MMS suspend my obligation to comply with an
order?
(a) Federal leases. Subject to paragraph (d) of this section, if
you appeal an order regarding the payment and reporting of royalties
and other payments due from Federal mineral leases onshore or on the
Outer Continental Shelf (OCS), and:
(1) If the amount under appeal is less than $10,000 or does not
require payment of a specified amount, MMS will suspend your obligation
to comply with the order. MMS will use the lease surety posted with the
Bureau of Land Management for onshore leases, and MMS for OCS leases,
as collateral for the obligation; or
(2) If the amount under appeal is $10,000 or more, MMS will suspend
your obligation to comply with that order if you:
(i) Submit an MMS-specified surety instrument under subpart B of
this part within a time period MMS prescribes; or
(ii) Demonstrate financial solvency under subpart C.
(b) Indian leases. Subject to paragraph (d) of this section, if you
appeal an order regarding the payment and reporting of royalties and
other payments due from Indian mineral leases subject to this part,
and:
(1) If the amount under appeal is less than $1,000 or does not
require payment, MMS will suspend your obligation to comply with the
order. MMS will use the lease surety posted with the Bureau of Indian
Affairs as collateral for the obligation; or
(2) If the amount under appeal is $1,000 or more, MMS will suspend
your obligation to comply with that order if you submit an MMS-
specified surety instrument under subpart B of this part within a time
period MMS prescribes.
(c) Nothing in this part prohibits you from paying any demanded
amount or complying with any other requirement pending appeal. However,
voluntarily paying any demanded amount or otherwise complying with any
other requirement when suspension of an order is otherwise available
under these rules does not create judicially reviewable final agency
action under 5 U.S.C. 704.
(d) Regardless of the amount under appeal, MMS may inform you that
it will not suspend your obligation to comply with the order under
paragraph (a) or (b) of this section because suspension would harm the
interests of the United States or the Indian lessor.
Sec. 243.9 Will MMS continue to suspend my obligation to comply with
an order if I seek judicial review in a Federal court?
(a) If you seek judicial review of an IBLA decision or other final
action of the Department of the Interior regarding an order, MMS will
suspend your obligation to comply with that order pending judicial
review if you continue to meet the requirements of this part.
(b) Notwithstanding the provisions of paragraph (a) of this
section, MMS may decide that it will not suspend your obligation to
comply with an order. MMS will notify you in writing of that decision
and the reasons for it.
Sec. 243.10 When will MMS collect against a bond or other surety
instrument or a person demonstrating financial solvency?
(a) This section applies to you if, for an appeal of an order under
this part, you:
(1) Maintain a bond or an MMS-specified surety instrument on your
own behalf or for another person; or
(2) Have demonstrated financial solvency on your own behalf or for
another person.
(b) MMS may initiate collection against the bond or other surety
instrument or the person demonstrating financial solvency:
(1) If the MMS Director or the Deputy Commissioner of Indian
Affairs decides your appeal adversely to you and you do not pay the
amount due or appeal that decision to the IBLA under 43 CFR part 4,
subpart E;
(2) If the IBLA, the Director of the Office of Hearings and
Appeals, an Assistant Secretary, or the Secretary decides your appeal
adversely to you, and you do not pay the amount due or pursue judicial
review within 90 days of the decision;
(3) If a court of competent jurisdiction issues a final non-
appealable decision adverse to you, and you do not pay the amount due
within 30 days of the decision;
(4) If you do not increase the amount of your bond or other surety
instrument as required under Sec. 243.101(b), or otherwise fail to
maintain an adequate surety instrument in effect, and you do not pay
the amount due under the order within 30 days of notice from MMS under
Sec. 243.101(b);
(5) If the obligation to comply with an order or decision is not
suspended under Sec. 243.8 or Sec. 243.9 and you do not pay the amount
required under the order or decision; or
(6) If the MMS bond-approving officer determines that you are no
longer financially solvent under Sec. 243.202(c), and you do not pay
the order amount or post a bond or other MMS-specified surety
instrument under subpart B within 30 days of that determination.
Sec. 243.11 May I appeal the MMS bond-approving officer's
determination of my surety amount or financial solvency?
Any decision on your surety amount under subpart B or your
financial solvency under subpart C is final and is not subject to
appeal.
[[Page 26256]]
Sec. 243.12 May I substitute a demonstration of financial solvency for
a bond posted before the effective date of this rule?
If you appealed an order before June 14, 1999 and you submitted an
MMS-specified surety instrument to suspend compliance with that order,
you may replace the surety with a demonstration of financial solvency
under this part at an administratively convenient time, such as when
the surety instrument is due for renewal.
Subpart B--Bonding Requirements
Sec. 243.100 What standards must my MMS-specified surety instrument
meet?
(a) An MMS-specified surety instrument must be in a form specified
in MMS instructions. MMS will give you written information and standard
forms for MMS-specified surety instrument requirements.
(b) MMS will use a bank-rating service to determine whether a
financial institution has an acceptable rating to provide a surety
instrument adequate to indemnify the lessor from loss or damage.
(1) Administrative appeal bonds must be issued by a qualified
surety company which the Department of the Treasury has approved.
(2) Irrevocable letters of credit or certificates of deposit must
be from a financial institution acceptable to MMS with a minimum 1-year
period of coverage subject to automatic renewal up to 5 years.
Sec. 243.101 How will MMS determine the amount of my bond or other
surety instrument?
(a) The MMS bond-approving officer may approve your surety if he or
she determines that the amount is adequate to guarantee payment. The
amount of your surety may vary depending on the form of the surety and
how long the surety is effective.
(1) The amount of the MMS-specified surety instrument must include
the principal amount owed under the order plus any accrued interest we
determine is owed plus projected interest for a 1-year period.
(2) Treasury book-entry bond or note amounts must be equal to at
least 120 percent of the required surety amount.
(b) If your appeal is not decided within 1 year from the filing
date, you must increase the surety amount to cover additional estimated
interest for another 1-year period. You must continue to do this
annually on the date your appeal was filed. We will determine the
additional estimated interest and notify you of the amount so you can
amend your surety instrument.
(c) You may submit a single surety instrument that covers multiple
appeals. You may change the instrument to add new amounts under appeal
or remove amounts that have been adjudicated in your favor or that you
have paid if you:
(1) Amend the single surety instrument annually on the date you
filed your first appeal; and
(2) Submit a separate surety instrument for new amounts under
appeal until you amend the instrument to cover the new appeals.
Subpart C--Financial Solvency Requirements
Sec. 243.200 How do I demonstrate financial solvency?
(a) To demonstrate financial solvency under this part, you must
submit an audited consolidated balance sheet, and, if requested by the
MMS bond-approving officer, up to 3 years of tax returns to the MMS,
Debt Collection Section using:
(1) The U.S. Postal Service or private delivery at P.O. Box 5760,
MS 3031, Denver, CO 80217-5760; or
(2) Courier or overnight delivery at MS 3031, Denver Federal
Center, Bldg. 85, Room A-212, Denver, CO 80225-0165.
(b) You must submit an audited consolidated balance sheet annually,
and, if requested, additional annual tax returns on the date MMS first
determined that you demonstrated financial solvency as long as you have
active appeals, or whenever MMS requests.
(c) If you demonstrate financial solvency in the current calendar
year, you are not required to redemonstrate financial solvency for new
appeals of orders during that calendar year unless you file for
protection under any provision of the U.S. Bankruptcy Code (Title 11 of
the United States Code), or MMS notifies you that you must
redemonstrate financial solvency.
Sec. 243.201 How will MMS determine if I am financially solvent?
(a) The MMS bond-approving officer will determine your financial
solvency by examining your total net worth, including, as appropriate,
the net worth of your affiliated entities.
(b) If your net worth, minus the amount we would require as surety
under subpart B for all orders you have appealed is greater than $300
million, you are presumptively deemed financially solvent, and we will
not require you to post a bond or other surety instrument.
(c) If your net worth, minus the amount we would require as surety
under subpart B for all orders you have appealed is less than $300
million, you must submit the following to the MMS Debt Collection
Section by one of the methods in Sec. 243.200(a):
(1) A written request asking us to consult a business-information,
or credit-reporting service or program to determine your financial
solvency; and
(2) A nonrefundable $50 processing fee:
(i) You must pay the processing fee to us following the
requirements for making payments found in 30 CFR 218.51. You are not
required to use Electronic Funds Transfer (EFT) for these payments;
(ii) You must submit the fee with your request under paragraph
(c)(1) of this section, and then annually on the date we first
determined that you demonstrated financial solvency, as long as you are
not able to demonstrate financial solvency under paragraph (a) of this
section and you have active appeals.
(d) If you request that we consult a business-information or
credit-reporting service or program under paragraph (c) of this
section:
(1) We will use criteria similar to that which a potential creditor
would use to lend an amount equal to the bond or other surety
instrument we would require under subpart B;
(2) For us to consider you financially solvent, the business-
information or credit-reporting service or program must demonstrate
your degree of risk as low to moderate:
(i) If our bond-approving officer determines that the business-
information or credit-reporting service or program information
demonstrates your financial solvency to our satisfaction, our bond-
approving officer will not require you to post a bond or other surety
instrument under subpart B;
(ii) If our bond-approving officer determines that the business-
information or credit-reporting service or program information does not
demonstrate your financial solvency to our satisfaction, our bond-
approving officer will require you to post a bond or other surety
instrument under subpart B or pay the obligation.
Sec. 243.202 When will MMS monitor my financial solvency?
(a) If you are presumptively financially solvent under
Sec. 243.201(b), MMS will determine your net worth as described under
Secs. 243.201(b) and (c) to evaluate your financial solvency at least
annually on the date we first determined that you demonstrated
financial solvency as long as you have
[[Page 26257]]
active appeals and each time you appeal a new order.
(b) If you ask us to consult a business-information or credit-
reporting service or program under Sec. 243.201(c), we will consult a
service or program annually as long as you have active appeals and each
time you appeal a new order.
(c) If our bond-approving officer determines that you are no longer
financially solvent, you must post a bond or other MMS-specified surety
instrument under subpart B.
PART 250--OIL AND GAS AND SULPHUR OPERATIONS IN THE OUTER
CONTINENTAL SHELF
10. The authority citation for part 250 continues to read as
follows:
Authority: 43 U.S.C. 1331, et seq.
10a. Section 250.1409 is revised to read as follows:
Sec. 250.1409 What are my appeal rights?
(a) When you receive the Reviewing Officer's final decision, you
have 60 days to either pay the penalty or file an appeal in accordance
with 30 CFR part 290, subpart A.
(b) If you file an appeal, you must either:
(1) Submit a surety bond in the amount of the penalty to the
Regional Adjudication Office in the Region where the penalty was
assessed, following instructions that the Reviewing Officer will
include in the final decision; or
(2) Notify the Regional Adjudication Office, in the Region where
the penalty was assessed, that you want your lease-specific/area-wide
bond on file to be used as the bond for the penalty amount.
(c) If you choose the alternative in paragraph (b)(2) of this
section, the Regional Director may require additional security (i.e.,
security in excess of your existing bond) to ensure sufficient coverage
during an appeal. In that event, the Regional Director will require you
to post the supplemental bond with the regional office in the same
manner as under Secs. 256.53(d) through (f) of this chapter. If the
Regional Director determines the appeal should be covered by a lease-
specific abandonment account then you must establish an account that
meets the requirements of Sec. 256.56.
(d) If you do not either pay the penalty or file a timely appeal,
MMS will take one or more of the following actions:
(1) We will collect the amount you were assessed, plus interest,
late payment charges, and other fees as provided by law, from the date
you received the Reviewing Officer's final decision until the date we
receive payment;
(2) We may initiate additional enforcement, including, if
appropriate, cancellation of the lease, right-of-way, license, permit,
or approval, or the forfeiture of a bond under this part; or
(3) We may bar you from doing further business with the Federal
Government according to Executive Orders 12549 and 12689, and section
2455 of the Federal Acquisition Streamlining Act of 1994, 31 U.S.C.
6101. The Department of the Interior's regulations implementing these
authorities are found at 43 CFR part 62, subpart D.
11. Part 290 of subchapter C is revised to read as follows:
PART 290--APPEAL PROCEDURES
Subpart A--Offshore Minerals Management Appeal Procedures
Sec.
290.1 What is the purpose of this subpart?
290.2 Who may appeal?
290.3 What is the time limit for filing an appeal?
290.4 How do I file an appeal?
290.5 Can I obtain an extension for filing my Notice of Appeal?
290.6 Are informal resolutions permitted?
290.7 Do I have to comply with the decision or order while my
appeal is pending?
290.8 How do I exhaust my administrative remedies?
Subpart B--Appeals of Royalty Management Program and Delegated State
Orders
290.100 What is the purpose of this subpart?
290.101 What leases are subject to this subpart?
290.102 What definitions apply to this subpart?
290.103 Who may file an appeal?
290.104 What may I not appeal under this subpart?
290.105 How do I appeal an order?
290.106 How do lessees join a designee's appeal and how does
joinder affect the appeal?
290.107 Where are the rules concerning the effect of the Department
not issuing a decision in my appeal within the statutory time frame?
290.108 How do I appeal to the IBLA?
290.109 How do I request an extension of time?
Authority: 5 U.S.C. 301 et seq.; 43 U.S.C. 1331 et seq.
Subpart A--Offshore Minerals Management Appeal Procedures
Sec. 290.1 What is the purpose of this subpart?
The purpose of this subpart is to explain the procedures for
appeals of Minerals Management Service (MMS) Offshore Minerals
Management (OMM) decisions and orders issued under subchapter B.
Sec. 290.2 Who may appeal?
If you are adversely affected by an OMM official's final decision
or order issued under 30 CFR chapter II, subchapter B, you may appeal
that decision or order to the Interior Board of Land Appeals (IBLA).
Your appeal must conform with the procedures found in this subpart and
43 CFR part 4, subpart E. A request for reconsideration of an MMS
decision concerning a lease bid, authorized in 30 CFR 256.47(e)(3) and
281.21(a)(1), or a deep water field determination, authorized in 30 CFR
203.79(a) and 30 CFR 260.110(d)(2), is not subject to the procedures
found in this part.
Sec. 290.3 What is the time limit for filing an appeal?
You must file your appeal within 60 days after you receive OMM's
final decision or order. The 60-day time period applies rather than the
time period provided in 43 CFR 4.411(a). A decision or order is
received on the date you sign a receipt confirming delivery or, if
there is no receipt, the date otherwise documented.
Sec. 290.4 How do I file an appeal?
For your appeal to be filed, MMS must receive all of the following
within 60 days after you receive the decision or order:
(a) A written Notice of Appeal together with a copy of the decision
or order you are appealing in the office of the OMM officer that issued
the decision or order. You cannot extend the 60-day period for that
office to receive your Notice of Appeal; and
(b) A nonrefundable processing fee of $150 paid with the Notice of
Appeal.
(1) Identify the order you are appealing on the check or other form
of payment you use to pay the processing fee.
(2) You cannot extend the 60-day period for payment of the
processing fee.
(3) You must pay the processing fee to MMS following the
requirements for making payments found in 30 CFR 218.51. You are not
required to use Electronic Funds Transfer (EFT) for these payments.
Sec. 290.5 Can I obtain an extension for filing my Notice of Appeal?
You cannot obtain an extension of time to file the Notice of
Appeal. See 43 CFR 4.411(c).
[[Page 26258]]
Sec. 290.6 Are informal resolutions permitted?
(a) You may seek informal resolution with the issuing officer's
next level supervisor during the 60-day period established in
Sec. 290.3.
(b) Nothing in this subpart precludes resolution by settlement of
any appeal or matter pending in the administrative process after the
60-day period established in Sec. 290.3.
Sec. 290.7 Do I have to comply with the decision or order while my
appeal is pending?
(a) The decision or order is effective during the 60-day period for
filing an appeal under Sec. 290.3 unless:
(1) OMM notifies you that the decision or order, or some portion of
it, is suspended during this period because there is no likelihood of
immediate and irreparable harm to human life, the environment, any
mineral deposit, or property; or
(2) You post a surety bond under 30 CFR 250.1409 pending the appeal
challenging an order to pay a civil penalty.
(b) This section applies rather than 43 CFR 4.21(a) for appeals of
OMM orders.
(c) After you file your appeal, IBLA may grant a stay of a decision
or order under 43 CFR 4.21(b); however, a decision or order remains in
effect until IBLA grants your request for a stay of the decision or
order under appeal.
Sec. 290.8 How do I exhaust my administrative remedies?
(a) If you receive a decision or order issued under chapter II,
subchapter B, you must appeal that decision or order to IBLA under 43
CFR part 4, subpart E to exhaust administrative remedies.
(b) This section does not apply if the Assistant Secretary for Land
and Minerals Management or the IBLA makes a decision or order
immediately effective notwithstanding an appeal.
Subpart B--Appeals of Royalty Management Program and Delegated
States Orders
Sec. 290.100 What is the purpose of this subpart?
This subpart tells you how to appeal Minerals Management Service
(MMS) or delegated State orders concerning reporting to the MMS Royalty
Management Program (RMP) and the payment of royalties and other
payments due under leases subject to this subpart.
Sec. 290.101 What leases are subject to this subpart?
This subpart applies to:
(a) All Federal mineral leases onshore and on the Outer Continental
Shelf (OCS); and
(b) All federally-administered mineral leases on Indian tribal and
individual Indian mineral owners' lands, regardless of the statutory
authority under which the lease was issued or maintained.
Sec. 290.102 What definitions apply to this subpart?
Assessment means any fee or charge levied or imposed by the
Secretary or a delegated State other than:
(1) The principal amount of any royalty, minimum royalty, rental,
bonus, net profit share or proceed of sale;
(2) Any interest; or
(3) Any civil or criminal penalty.
Delegated State means a State to which MMS has delegated authority
to perform royalty management functions under an agreement or
agreements under regulations at 30 CFR part 227.
Designee means the person designated by a lessee under 30 CFR
218.52 to make all or part of the royalty or other payments due on a
lease on the lessee's behalf.
IBLA means the Interior Board of Land Appeals.
Indian lessor means an Indian tribe or individual Indian mineral
owner with a beneficial or restricted interest in a property that is
subject to a lease issued or administered by the Secretary on behalf of
the tribe or individual Indian mineral owner.
Lease means any agreement authorizing exploration for or extraction
of any mineral, regardless of whether the instrument is expressly
denominated as a ``lease,'' including any:
(1) Contract;
(2) Net profit share arrangement;
(3) Joint venture; or
(4) Agreement the Secretary approves under the Indian Mineral
Development Act, 25 U.S.C. 2101 et seq.
Lessee means any person to whom the United States, or the United
States on behalf of an Indian tribe or individual Indian mineral owner,
issues a lease subject to this subpart, or any person to whom all or
part of the lessee's interest or operating rights in a lease subject to
this subpart has been assigned.
Notice of Order means the notice that MMS or a delegated State
issues to a lessee that informs the lessee that MMS or the delegated
State has issued an order to the lessee's designee.
Obligation means:
(1) A lessee's, designee's or payor's duty to:
(i) Deliver oil or gas royalty in kind; or
(ii) Make a lease-related payment, including royalty, minimum
royalty, rental, bonus, net profit share, proceeds of sale, interest,
penalty, civil penalty, or assessment; and
(2) The Secretary's duty to:
(i) Take oil or gas royalty-in-kind; or
(ii) Make a lease-related payment, refund, offset, or credit,
including royalty, minimum royalty, rental, bonus, net profit share,
proceeds of sale, or interest.
(3) The obligations identified in paragraphs (1)(i) and (2)(i) of
this definition are nonmonetary obligations. The obligations identified
in paragraphs (1)(ii) and (2)(ii), including the requirement to compute
the amount of such obligations, are monetary obligations.
Order for purposes of this subpart only, means any document issued
by the MMS Director, MMS RMP, or a delegated State that contains
mandatory or ordering language that requires the recipient to do any of
the following for any lease subject to this subpart: report, compute,
or pay royalties or other obligations, report production, or provide
other information.
(1) Order includes:
(i) An order to pay or to compute and pay; and
(ii) An MMS or delegated State decision to deny a lessee's,
designee's, or payor's written request that asserts an obligation due
the lessee, designee or payor.
(2) Order does not include:
(i) A non-binding request, information, or guidance, such as:
(A) Advice or guidance on how to report or pay, including a
valuation determination, unless it contains mandatory or ordering
language; and
(B) A policy determination;
(ii) A subpoena;
(iii) An order to pay that MMS issues to a refiner or other person
involved in disposition of royalty taken in kind; or
(iv) A Notice of Noncompliance or a Notice of Civil Penalty issued
under 30 U.S.C. 1719 and 30 CFR part 241, or a decision of an
administrative law judge or of the IBLA following a hearing on the
record on a Notice of Noncompliance or Notice of Civil Penalty.
Party means MMS, any person who files a Notice of Appeal, and any
person who files a Notice of Joinder in an appeal under this subpart.
Sec. 290.103 Who may file an appeal?
(a) If you receive an order that adversely affects you or your
lessee, you may appeal that order except as provided under
Sec. 290.104.
(b) If you are a lessee and you receive a Notice of Order, and if
you contest the order, you may either appeal the order
[[Page 26259]]
or join in your designee's appeal under Sec. 290.106.
Sec. 290.104 What may I not appeal under this subpart?
You may not appeal:
(a) An action that is not an order, as defined in this subpart; or
(b) A determination of the surety amount or financial solvency
under 30 CFR part 243, subparts B or C.
Sec. 290.105 How do I appeal an order?
(a) You may appeal an order to the Director, Minerals Management
Service (MMS Director), by filing a Notice of Appeal in the office of
the official issuing the order within 30 days from service of the
order.
(1) Within the same 30-day period, you must file in the office of
the official issuing the order a statement of reasons or written
arguments or briefs that include the arguments on the facts or laws
that you believe justify reversal or modification of the order.
(2) If you are a designee, when you file your Notice of Appeal you
must serve your Notice of Appeal on the lessees for the leases in the
order you appealed.
(b) You may not request and will not receive an extension of time
for filing the Notice of Appeal.
(c) If the office of the official issuing the order does not
receive the Notice of Appeal within the time provided in paragraph (a)
of this section, the Notice of Appeal will be considered timely if the
office of the official issuing the order receives:
(1) The Notice of Appeal not later than 10 days after the required
filing date; and
(2) The officer with whom the Notice of Appeal must be filed
determines that the Notice of Appeal was transmitted to the proper
office before the filing deadline in paragraph (a) of this section.
(d) If the Notice of Appeal is filed after the grace period
provided in paragraph (c) of this section and was not transmitted to
the proper office before the filing deadline in paragraph (a) of this
section, the MMS Director will not consider the Notice of Appeal and
the case will be closed.
(e) The officer with whom the Notice of Appeal is filed will send
the appeal and accompanying papers to the MMS Director.
(f) The MMS Director will review the record and render a decision
in the case.
(g) If an order involves Indian leases, the Deputy Commissioner of
Indian Affairs will exercise the functions vested in the MMS Director.
Sec. 290.106 How do lessees join a designee's appeal and how does
joinder affect the appeal?
(a) If you are a lessee, and your designee files an appeal under
Sec. 290.103, you may join in that appeal within 30 days after you
receive your designee's Notice of Appeal under Sec. 290.105(a)(2) by
filing a Notice of Joinder with the office or official that issued the
order.
(b) If you join in an appeal under paragraph (a) of this section,
you are deemed to appeal the order jointly with the designee, but the
designee must fulfill all requirements imposed on appellants under this
subpart and 43 CFR part 4, subparts E and J. You may not file
submissions or pleadings separately from the designee.
(c) If you are a lessee and you neither appeal nor join in your
designee's appeal under this section, your designee's actions with
respect to the appeal and any decisions in the appeal bind you.
(d) If you are a designee and you decide to discontinue
participation in the appeal, you must serve written notice within 30
days before the next submission or pleading is due on:
(1) All lessees who have joined in the appeal under paragraph (a)
of this section;
(2) The office or officer with whom any subsequent submissions or
pleadings must be filed, including the IBLA; and
(3) All other parties to the appeal.
(e) If you have joined in the appeal under paragraph (a) of this
section, and if the designee notifies you under paragraph (d) of this
section that it declines to further pursue the appeal, you become an
appellant and must then meet all requirements of this subpart and 43
CFR part 4, subparts E and J, as the appellant.
Sec. 290.107 Where are the rules concerning the effect of the
Department not issuing a decision in my appeal within the statutory
time frame?
If your appeal involves monetary or nonmonetary obligations under
Federal oil and gas leases, the rules concerning the effect of the
Department not issuing a final decision in your appeal within the 33-
month period prescribed under 30 U.S.C. 1724(h) are located in 43 CFR
part 4, subpart J.
Sec. 290.108 How do I appeal to the IBLA?
Any party to a case adversely affected by a final decision of the
MMS Director or the Deputy Commissioner of Indian Affairs under this
subpart shall have a right of appeal to the IBLA under the procedures
provided in 43 CFR part 4, subpart E.
Sec. 290.109 How do I request an extension of time?
(a) If you are a party to an appeal under this subpart, and you
need additional time after the appeal commences under 43 CFR 4.904 for
any purpose:
(1) You may obtain an extension of time under this section; and
(2) You must submit a written request for an extension of time to:
(i) The office or official with whom you must file a document
before the required filing date; or
(ii) If you are not seeking an extension of time to file a
document, to the office or official before whom the appeal is pending.
(b) If you are an appellant, and if your appeal involves monetary
or nonmonetary obligations under Federal oil and gas leases, you must
agree in writing in your request to extend the period in which the
Department must issue a final decision in your appeal under 30 U.S.C.
1724(h) and 43 CFR 4.906, by the amount of time for which you are
requesting an extension.
(c) If you are any other party to an appeal involving monetary or
nonmonetary obligations under Federal oil and gas leases, the office or
official with whom you must file the request may require you to submit
a written agreement signed by the appellant to extend the period in
which the Department must issue a final decision in the appeal under 43
CFR 4.906, by the amount of time for which you are requesting an
extension.
(d) The office or official with whom you must file your request may
decline any request for an extension of time.
(e) You must serve your request on all parties to the appeal.
43 CFR PART 4--DEPARTMENT HEARINGS AND APPEALS PROCEDURES
13. The authority citation for part 4 continues to read as follows:
Authority: R.S. 2478, as amended, 43 U.S.C. sec. 1201, unless
otherwise noted.
14. In 43 CFR part 4, subpart J is added to read as follows.
Subpart J--Special Rules Applicable to Appeals Concerning Federal Oil
and Gas Royalties and Related Matters
4.901 What is the purpose of this subpart?
4.902 What appeals are subject to this subpart?
4.903 What definitions apply to this subpart?
4.904 When does my appeal commence and end?
4.905 What if a due date falls on a day the Department or relevant
office is not open for business?
[[Page 26260]]
4.906 What if the Department does not issue a decision by the date
my appeal ends?
4.907 What if an IBLA decision requires MMS or a delegated State to
recalculate royalties or other payments?
4.908 What is the administrative record for my appeal if it is
deemed decided?
4.909 How do I request an extension of time?
Authority: 5 U.S.C. 301 et seq.; 25 U.S.C. 396 et seq., 396a et
seq., 2101 et seq.; 30 U.S.C. 181 et seq., 351 et seq., 1001 et
seq., 1701 et seq.; 31 U.S.C 9701; 43 U.S.C. 1301 et seq., 1331 et
seq., and 1801 et seq.
Subpart J--Special Rules Applicable to Appeals Concerning Federal
Oil and Gas Royalties and Related Matters
Sec. 4.901 What is the purpose of this subpart?
This subpart tells you how the time limits of 30 U.S.C. 1724(h)
apply to appeals subject to this subpart.
Sec. 4.902 What appeals are subject to this subpart?
(a) This subpart applies to appeals under 30 CFR part 290 in effect
prior to May 13, 1999 and contained in the 30 CFR, parts 200 to 699,
edition revised as of July 1, 1998, 30 CFR part 290 subpart B, and 43
CFR part 4, subpart E, of Minerals Management Service (MMS) or
delegated State orders or portions of orders concerning payment (or
computation and payment) of royalties and other payments due, and
delivery or taking of royalty in kind, under Federal oil and gas
leases.
(b) This subpart does not apply to appeals of orders, or portions
of orders, that
(1) Involve Indian leases or Federal leases for minerals other than
oil and gas; or
(2) Relate to Federal oil and gas leases but do not involve a
monetary or nonmonetary obligation.
Sec. 4.903 What definitions apply to this subpart?
For the purposes of this subpart only:
Assessment means any fee or charge levied or imposed by the
Secretary or a delegated State other than:
(1) The principal amount of any royalty, minimum royalty, rental,
bonus, net profit share or proceed of sale;
(2) Any interest; or
(3) Any civil or criminal penalty.
Delegated State means a State to which MMS has delegated authority
to perform royalty management functions under an agreement or
agreements under 30 CFR part 227.
Designee means the person designated by a lessee under 30 CFR
218.52 to make all or part of the royalty or other payments due on a
lease on the lessee's behalf.
IBLA means the Interior Board of Land Appeals.
Lease means any agreement authorizing exploration for or extraction
of any mineral, regardless of whether the instrument is expressly
denominated as a ``lease,'' including any:
(1) Contract;
(2) Net profit share arrangement; or
(3) Joint venture.
Lessee means any person to whom the United States issues a Federal
oil and gas lease, or any person to whom all or part of the lessee's
interest or operating rights in a Federal oil and gas lease has been
assigned.
Monetary obligation means a lessee's, designee's or payor's duty to
pay, or to compute and pay, any obligation in any order, or the
Secretary's duty to pay, refund, offset, or credit the amount of any
obligation that is the subject of a decision by the MMS or a delegated
State denying a lessee's, designee's, or payor's written request for
the payment, refund, offset, or credit. To determine the amount of any
monetary obligation, for purposes of the default rule of decision in
Sec. 4.906 and 30 U.S.C. 1724(h):
(1) If an order asserts a monetary obligation arising from one
issue or type of underpayment that covers multiple leases or production
months, the total obligation for all leases or production months
involved constitutes a single monetary obligation;
(2) If an order asserts monetary obligations arising from different
issues or types of underpayments for one or more leases, the
obligations arising from each separate issue, subject to paragraph (1)
of this definition, constitute separate monetary obligations; and
(3) If an order asserts a monetary obligation with a stated amount
of additional royalties due, plus an order to perform a restructured
accounting arising from the same issue or cause as the specifically
stated underpayment, the stated amount of royalties due plus the
estimated amount due under the restructured accounting, subject to
paragraphs (1) and (2) of this definition, together constitutes a
single monetary obligation.
Nonmonetary obligation means any duty of a lessee or its designee
to deliver oil or gas in kind, or any duty of the Secretary to take oil
or gas royalty in kind.
Notice of Order means the notice that MMS or a delegated State
issues to a lessee that informs the lessee that MMS or the delegated
State has issued an order to the lessee's designee.
Obligation means:
(1) A lessee's, designee's or payor's duty to:
(i) Deliver oil or gas royalty in kind; or
(ii) Make a lease-related payment, including royalty, minimum
royalty, rental, bonus, net profit share, proceeds of sale, interest,
penalty, civil penalty, or assessment; and
(2) The Secretary's duty to:
(i) Take oil or gas royalty in kind; or
(ii) Make a lease-related payment, refund, offset, or credit,
including royalty, minimum royalty, rental, bonus, net profit share,
proceeds of sale, or interest.
Order means any document or portion of a document issued by the MMS
Director, MMS RMP, or a delegated State, that contains mandatory or
ordering language regarding any monetary or nonmonetary obligation
under any Federal oil and gas lease or leases.
(1) Order includes but is not limited to the following:
(i) An order to pay;
(ii) A MMS or delegated State decision to deny a lessee's,
designee's, or payor's written request that asserts an obligation due
the lessee, designee or payor.
(2) Order does not include:
(i) A non-binding request, information, or guidance, such as:
(A) Advice or guidance on how to report or pay, including valuation
determination, unless it contains mandatory or ordering language; and
(B) A policy determination;
(ii) A subpoena;
(iii) An order to pay that MMS issues to a refiner or other person
involved in disposition of royalty taken in kind; or
(iv) a Notice of Noncompliance or a Notice of Civil Penalty issued
under 30 U.S.C. 1719 and 30 CFR part 241, or a decision of an
administrative law judge or of the IBLA following a hearing on the
record on a Notice of Noncompliance or Notice of Civil Penalty.
Party means MMS, any person who files a Notice of Appeal under 30
CFR part 290 in effect prior to May 13, 1999 and contained in the 30
CFR, parts 200 to 699, edition revised as of July 1, 1998, 30 CFR part
290 subpart B, or 43 CFR part 4, subpart E, and any person who files a
Notice of Joinder in an appeal under 30 CFR part 290, subpart B.
Payor means any person responsible for reporting and paying
royalties for Federal oil and gas leases for production before
September 1, 1996.
[[Page 26261]]
Sec. 4.904 When does my appeal commence and end?
For purposes of the period in which the Department must issue a
final decision in your appeal under Sec. 4.906:
(a) If you filed your Notice of Appeal and initial Statement of
Reasons with MMS before August 13, 1996, your appeal commenced on
August 13, 1996;
(b) If you filed your Notice of Appeal or initial Statement of
Reasons with MMS after August 13, 1996, under 30 CFR part 290, in
effect prior to May 13, 1999 and contained in the 30 CFR, parts 200 to
699, edition, revised as of July 1, 1998, your appeal commenced on the
date MMS received your Notice of Appeal, or if later, the date MMS
received your initial Statement of Reasons;
(c) If you filed your Notice of Appeal under 30 CFR part 290,
subpart B, your appeal commenced on the date MMS received your Notice
of Appeal.
(d) Your appeal ends on the same day of the month of the 33rd
calendar month after your appeal commenced under paragraph (a), (b), or
(c) of this section, plus the number of days of any applicable time
extensions under Sec. 4.909 or 30 CFR 290.109. If the 33rd calendar
month after your appeal commenced does not have the same day of the
month as the day of the month your appeal commenced, then the initial
33-month period ends on the last day of the 33rd calendar month.
Sec. 4.905 What if a due date falls on a day the Department or
relevant office is not open for business?
If a due date under this subpart falls on a day the relevant office
is not open for business (such as a weekend, Federal holiday, or
shutdown), the due date is the next day the relevant office is open for
business.
Sec. 4.906 What if the Department does not issue a decision by the
date my appeal ends?
(a) If the IBLA or an Assistant Secretary (or the Secretary or the
Director of OHA) does not issue a final decision by the date an appeal
ends under Sec. 4.904(d), then under 30 U.S.C. 1724(h)(2), the
Secretary will be deemed to have decided the appeal:
(1) In favor of the appellant for any nonmonetary obligation at
issue in the appeal, or any monetary obligation at issue in the appeal
with a principal amount of less than $10,000;
(2) In favor of the Secretary for any monetary obligation at issue
in the appeal with a principal amount of $10,000 or more.
(b)(1) If your appeal ends before the MMS Director issues a
decision in your appeal, then the provisions of paragraph (a) of this
section apply to the monetary and nonmonetary obligations in the order
that you contested in your appeal to the Director.
(2) If the MMS Director issues a decision in your appeal before
your appeal ends, and if you appealed the Director's decision to IBLA
under 43 CFR part 4, subpart E, then the provisions of paragraph (a) of
this section apply to the monetary and nonmonetary obligations in the
Director's decision that you contested in your appeal to IBLA.
(3) If the MMS Director issues a decision in your appeal, and if
you did not appeal the Director's decision to IBLA within the time
required under 30 CFR part 290 in effect prior to May 13, 1999 and
contained in the 30 CFR, parts 200 to 699, edition revised as of July
1, 1998 (for appeals filed before May 13, 1999 or 30 CFR part 290
subpart B (for appeals filed on or after May 13, 1999 and 43 CFR part
4, subpart E, then the MMS Director's decision is the final decision of
the Department and 30 U.S.C. 1724(h)(2) has no application.
(c) If the IBLA issues a decision before the date your appeal ends,
that decision is the final decision of the Department and 30 U.S.C.
1724(h)(2) has no application. A petition for reconsideration does not
extend or renew the 33-month period.
(d) If any part of the principal amount of any monetary obligation
is not specifically stated in an order or MMS Director's decision and
must be computed to comply with the order or MMS Director's decision,
then the principal amount referred to in paragraph (a) of this section
means the principal amount MMS estimates you would be required to pay
as a result of the computation required under the order, plus any
amount due stated in the order.
Sec. 4.907 What if an IBLA decision requires MMS or a delegated State
to recalculate royalties or other payments?
(a) An IBLA decision modifying an order or an MMS Director's
decision and requiring MMS or a delegated State to recalculate
royalties or other payments is a final decision in the administrative
proceeding for purposes of 30 U.S.C. 1724(h).
(b) MMS or the delegated State must provide to IBLA and all parties
any recalculation IBLA requires under paragraph (a) of this section
within 60 days of receiving IBLA's decision.
(c) There is no further appeal within the Department from MMS's or
the State's recalculation under paragraph (b) of this section.
(d) The IBLA decision issued under paragraph (a) of this section
together with recalculation under paragraph (b) of this section are the
final action of the Department that is judicially reviewable under 5
U.S.C. 704.
Sec. 4.908 What is the administrative record for my appeal if it is
deemed decided?
If your appeal is deemed decided under Sec. 4.906, the record for
your appeal consists of:
(a) The record established in an appeal before the MMS Director;
(b) Any additional correspondence or submissions to the MMS
Director;
(c) The MMS Director's decision in an appeal;
(d) Any pleadings or submissions to the IBLA; and
(e) Any IBLA orders and decisions.
Sec. 4.909 How do I request an extension of time?
(a) If you are a party to an appeal subject to this subpart before
the IBLA, and you need additional time after an appeal commences for
any purpose, you may obtain an extension of time under this section.
(b) You must submit a written request for an extension of time
before the required filing date.
(1) You must submit your request to the IBLA at Interior Board of
Land Appeals, 4015 Wilson Boulevard, Arlington, Virginia 22203, using
the U.S. Postal Service, a private delivery or courier service, hand
delivery or telefax to (703) 235-8349;
(2) If you file a document by telefax, you must send an additional
copy of your document to the IBLA using the U.S. Postal Service, a
private delivery or courier service or hand delivery so that it is
received within 5 business days of your telefax transmission.
(c) If you are an appellant, in addition to meeting the
requirements of paragraph (b) of this section, you must agree in
writing in your request to extend the period in which the Department
must issue a final decision in your appeal under Sec. 4.906 by the
amount of time for which you are requesting an extension.
(d) If you are any other party, the IBLA may require you to submit
a written agreement signed by the appellant to extend the period in
which the Department must issue a final decision in the appeal under
Sec. 4.906 by the amount of time for which you are requesting an
extension.
(e) The IBLA has the discretion to decline any request for an
extension of time.
[[Page 26262]]
(f) You must serve your request on all parties to the appeal.
[FR Doc. 99-11816 Filed 5-12-99; 8:45 am]
BILLING CODE 4310-MR-P
