[Federal Register Volume 59, Number 123 (Tuesday, June 28, 1994)]
[Unknown Section]
[Page ]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-15509]
[Federal Register: June 28, 1994]
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DEPARTMENT OF THE INTERIOR
Bureau of Reclamation
43 CFR Part 426
[RIN Number 1006-AA33]
Acreage Limitation Rules and Regulations
AGENCY: Bureau of Reclamation, Interior.
ACTION: Notice of proposed rulemaking.
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SUMMARY: The Reclamation Reform Act of 1982 (RRA), as amended, requires
landholders (landowners and lessees) to meet certain requirements in
order to be eligible to receive irrigation water from Bureau of
Reclamation (Reclamation) projects. The purposes of the proposed rule
are to improve compliance with the form submittal requirements of the
RRA and the Acreage Limitation Rules and Regulations (43 CFR Part 426),
help ensure that irrigation water is delivered only to eligible
landholders, and recoup administrative costs Reclamation incurs in
conjunction with noncompliance with these requirements. The proposed
rule revises the existing rules by adding a section that will impose
fees on districts when statutory and regulatory requirements concerning
the submittal of forms are not met.
DATES: Comments must be submitted on or before August 29, 1994.
ADDRESSES: Written comments must be submitted to J. William McDonald,
Assistant Commissioner--Resources Management, Bureau of Reclamation,
Attention: D-5640, P.O. Box 25007, Denver, CO 80225.
FOR FURTHER INFORMATION CONTACT: Gary Anderson, Chief, Reclamation Law
Administration Branch, Bureau of Reclamation, Attention: D-5640, P.O.
Box 25007, Denver, CO 80225, Telephone: (303) 236-1061, extension 221.
SUPPLEMENTARY INFORMATION: The RRA limits the amount of owned land on
which a landholder can receive irrigation water and places a limit on
the amount of leased land that can receive such water at a subsidized
water rate. In order to ensure compliance with the ownership
limitations and the limitations on subsidies, certain statutory and
regulatory requirements must be met.
One of these requirements applies to all landholders whose
landholdings in districts subject to the acreage limitation provisions
total more than 40 acres. These landholders must complete RRA
certification or reporting forms prior to receipt of irrigation water.
The forms must be completed annually and submitted to each district in
which the landholder receives irrigation water. Landholders must
disclose on the forms all the land they own and lease directly or
indirectly in Reclamation projects that are subject to the acreage
limitation provisions. The forms must be resubmitted whenever a
landholding change occurs. If a landholding does not change, a
verification statement to that effect must be submitted each year.
While the RRA and 43 CFR Part 426 set limits on the receipt of
irrigation water and establish requirements that must be met in order
to receive such water, the current rules do not address situations in
which water has been delivered to landholders who failed to meet all
the requirements. These situations were not addressed because the RRA
does not contemplate such deliveries.
Districts, rather than Reclamation, generally control the
deliveries of irrigation water to landholders. Pursuant to their
contracts with the United States, the districts are legally obligated
not to deliver irrigation water to landholders who do not meet the
eligibility requirements in the RRA.
With respect to the form requirements discussed previously, 43 CFR
426.10(k) specifically states that failure by landholders to submit the
required certification or reporting form(s) will result in loss of
eligibility to receive irrigation water. However, during its water
district reviews, Reclamation has found that in some instances,
districts have delivered irrigation water to landholders who had failed
to meet the form requirements and other requirements of the law and
rules.
In 1988, Reclamation adopted a compensation policy whereby full-
cost charges were assessed for irrigation water that had been delivered
to ineligible landholders. This policy is based on the legal theory
that when irrigation water is delivered to ineligible recipients, it is
an unlawful conversion of the Government's property interest in the
water, and the Government is therefore entitled to be compensated for
the conversion. Since Reclamation cannot recover the water that was
delivered to the ineligible recipients, it has been Reclamation's
position that it is entitled to recover the value of its property
interest in that water and that the full-cost water rate prescribed in
the RRA is an appropriate measure of the water's value.
When the new administration came into office in 1993, Reclamation
decided to review certain agency policies, one of which was the full-
cost compensation policy for RRA form violations. The Commissioner of
Reclamation asked the Department of the Interior's Office of the
Solicitor whether Reclamation is permitted to impose charges other than
full-cost compensation charges for such violations. In a July 23, 1993,
memorandum, the Associate Solicitor, Division of Energy and Resources,
advised the Commissioner that several laws ``* * * authorize
Reclamation to promulgate regulations necessary to carry out its
mission, including those which would assess fees. This means that
Reclamation may, by regulation, impose administrative fees or other
charges designed to recover the costs it incurs for processing
improperly submitted forms or for collecting forms from those who have
not submitted them.'' The Associate Solicitor further concluded that
``* * * Reclamation has considerable discretion in determining how to
calculate those costs, so long as the charges imposed bear a
demonstrable relationship to the costs incurred by the agency and have
the intended effect of improving compliance with the Act and achieving
congressional objectives.''
Based on the Associate Solicitor's conclusions, Reclamation decided
to consider the imposition of assessments to recover its administrative
costs. Under this approach, an assessment would be established based on
the costs incurred by Reclamation for additional actions the agency
must take to correct instances of noncompliance. An average cost per
violation would be determined and applied uniformly throughout
Reclamation projects. The assessments would provide an equitable method
for addressing RRA violations and result in charges that are
reasonable, while recovering the incremental costs Reclamation incurs.
In addition, even though such assessments would be applied after a
violation had taken place, they would provide an incentive for
landholders and districts to comply in upcoming water years. Thereby,
the assessments would help to ensure that ineligible landholders do not
receive irrigation water.
After reviewing the concept of assessments for administrative
costs, Reclamation decided to revise the current rules to provide for
such assessments. However, before initiating the rulemaking,
Reclamation notified the public of its intent and asked for their
comments. (See 58 FR 59427, Nov. 9, 1993.)
Summary of Comments
During the comment period, 32 responses were received. Most
responses were submitted by district personnel or attorneys
representing districts or other water user organizations; some
individual landholders also submitted comments. Approximately 50
percent of the respondents approved of Reclamation's intent to
establish the proposed assessments. The remaining 50 percent were
either opposed to the concept or did not express a strong position on
the matter.
The most frequently expressed comment was that the assessments
should not be based on the full-cost water rate as that term is defined
in the RRA. Many respondents gave suggestions for establishing the
proposed assessments; they are summarized in the following list.
The respondents thought the assessments should be:
1. fair;
2. reasonable;
3. uniform throughout Reclamation projects;
4. related to
(a) the severity of the violation,
(b) the number of acres involved in the violation,
(c) the costs incurred by the Government to enforce the RRA,
(d) the purposes of the RRA,
(e) the number of previous offenses by landholders and districts,
(f) costs other than Reclamation's audit costs;
5. minimal because
(a) the RRA is complex,
(b) sometimes Reclamation is at least partially responsible for the
offense;
6. limited to cases where
(a) water is delivered to landholders that failed to submit RRA
forms,
(b) water is delivered to excess land, (c) water users are pumping
more water than Reclamation law or the district contract allows;
7. applied
(a) prospectively only,
(b) only after landholders and districts have been given a grace
period in which to correct the problem,
(c) only if an error was intentional,
(d) within a reasonable amount of time after the offense occurred;
8. subject to an appeals and/or hearing process;
9. assessed to the districts;
10. assessed to the involved landholders;
11. collected by Reclamation;
12. credited to districts' contract obligations.
In addition to the above comments, some respondents questioned
Reclamation's authority to impose assessments for administrative costs.
A few respondents also questioned whether the assessments will have the
intended effect of improving compliance with the requirements of the
RRA. One respondent commented that Reclamation should not use the
assessments to replace the current requirement that landholders must
submit an RRA form as a condition for receipt of irrigation water.
Another stated that RRA compliance levels would improve if Reclamation
conducted water district reviews and district training sessions more
frequently. Two respondents requested Reclamation to increase the 40-
acre threshold for exemption from the RRA form requirements, while
another requested that the current class 1 equivalency provisions be
revised.
Reclamation received several suggestions for establishing the
amount of the assessments. Two respondents thought the assessment
should be $100 for instances where RRA forms contain minor errors. One
suggested that in cases where form errors are more significant; for
example, failure to disclose land held in excess of a non-full-cost
entitlement, the full-cost rate plus a $2,000 fee should be charged.
Another suggestion was that Reclamation should ask Congress to pass
legislation authorizing the agency to charge twice the full-cost rate
if irrigation water is delivered to excess land.
All comments were considered during preparation of the proposed
rule except for those relating to the forms exemption threshold,
equivalency provisions, deliveries to excess land, water district
reviews, and RRA training. These topics are outside the scope of the
subject rulemaking.
Summary of Proposed Rule
The proposed rule provides for the imposition of assessments for
administrative costs incurred by Reclamation in conjunction with
noncompliance with the form requirements. A district will be assessed
for administrative costs when RRA forms are not submitted prior to
receipt of irrigation water. The assessment will be applied on a yearly
basis in each district for each direct and indirect landholder that
failed to comply with the form requirements. A district will also be
assessed for administrative costs when corrections to RRA forms are not
provided within a 45-day grace period. The assessment will be applied
on a yearly basis in each district for each direct and indirect
landholder for which corrected forms are not provided within the grace
period. These assessments for administrative costs will replace the
full-cost charges that Reclamation currently assesses for form
violations pursuant to its compensation policy. The administrative cost
assessments will not be subject to the underpayment interest component
as set forth in Sec. 426.23.
The assessment for administrative costs is initially set at $260
per form violation. The amount is based on a review of the costs
Reclamation incurred in 1991, 1992, and 1993 performing activities to
address RRA form violations. The assessment reflects the average direct
and indirect costs incurred Reclamation-wide for: (1) communicating
with district representatives or landholders to obtain missing or
corrected forms, (2) assisting landholders in completing certification
or reporting forms for the period of time they were not in compliance
with the form requirements, (3) performing onsite visits to determine
if irrigation water deliveries have been terminated to landholders that
failed to submit the required forms, and (4) performing other
activities necessary to address form violations. The assessment will be
reviewed at least once every 5 years and, if needed, will be adjusted
to reflect new cost data.
As with other assessments, districts will be held responsible for
payment of the assessments because of their contractual obligation with
the United States. As required by 31 U.S.C. 3302, charges collected
through the imposition of assessments for administrative costs will be
credited to the general fund of the Treasury as miscellaneous receipts.
Payment of the assessments set forth in the proposed rule does not
exempt districts and landholders from the form requirements of the RRA
or Acreage Limitation Rules and Regulations. Districts are not
permitted to continue water deliveries to ineligible recipients simply
because they are willing to pay the assessments. Reclamation will take
all necessary actions to prevent the delivery of irrigation water to
ineligible land.
The Department of the Interior has determined that the proposed
rule does not constitute a significant regulatory action under
Executive Order 12866 because it will not: (1) have an annual effect on
the economy of $100 million or more or adversely affect in a material
way the economy, a sector of the economy, productivity, competition,
jobs, the environment, public health or safety, or State, local or
tribal governments or communities; (2) create a serious inconsistency
or otherwise interfere with an action taken or planned by another
agency; (3) materially alter the budgetary impact of entitlements,
grants, user fees, or loan programs or the rights and obligations of
recipients thereof; or (4) raise novel legal or policy issues arising
out of legal mandates, the President's priorities, or the principles
set forth in the executive order.
National Environmental Policy Act
Neither an environmental assessment nor an environmental impact
statement is required for this rulemaking because, pursuant to 40 CFR
1508.4 and Departmental Manual part 516 DM 6, Appendix 9, Sec. 9.4.A.1,
this action is categorically excluded from the provisions of the
National Environmental Policy Act.
Paperwork Reduction Act
The information collection requirements contained in this rule have
been approved by the Office of Management and Budget as is required by
44 U.S.C. 3501 et seq. and assigned clearance numbers 1006-0005 and
1006-0006.
Small Entity Flexibility Analysis
The proposed rule will not have a significant economic effect on a
substantial number of small entities.
Civil Justice Reform
The Department of the Interior has certified to the Office of
Management and Budget that this proposed rule meets the applicable
standards provided in sections 2(a) and 2(b)(2) of Executive Order
12778.
Authorship
This proposed rule was prepared by staff in the Reclamation Law
Administration Branch, D-5640, Bureau of Reclamation, Denver, Colorado.
List of Subjects in 43 CFR Part 426
Administrative practice and procedure, Irrigation, Reclamation,
Reporting and recordkeeping requirements.
For the reasons stated in the preamble, it is proposed to amend 43
CFR Part 426 as follows:
Dated: May 16, 1994.
Elizabeth Ann Rieke,
Assistant Secretary--Water and Science.
PART 426--RULES AND REGULATIONS FOR PROJECTS GOVERNED BY FEDERAL
RECLAMATION LAW
1. The authority citation for Part 426 is revised to read as
follows:
Authority: 43 U.S.C. 371-383; 43 U.S.C. 390aa-390zz-1; 31 U.S.C.
9701.
2. Section 426.24 is redesignated as Sec. 426.25, and new section
426.24 is added to read as follows:
Sec. 426.24 Assessments of administrative costs.
(a) Forms submittal. A district will be assessed for the
administrative costs described in paragraph (e) of this section when
irrigation water has been delivered to landholders that did not submit
certification or reporting forms prior to the receipt of irrigation
water in accordance with Sec. 426.10(e). The assessment will be applied
on a yearly basis in each district for each direct and indirect
landholder that received irrigation water but failed to comply with
Sec. 426.10(e).
(b) Forms corrections. Where corrections are needed on
certification or reporting forms, the requirements of Sec. 426.10(a)
will be deemed to have been met so long as the district provides
corrected forms to the Bureau of Reclamation within 45 days of the date
of the Bureau's written request for corrections. A district will be
assessed for the administrative costs described in paragraph (e) of
this section when corrected forms are not provided within this 45-day
time period. The assessment will be applied on a yearly basis in each
district for each direct and indirect landholder for whom corrected
forms are not provided within the applicable 45-day time period.
(c) Parties responsible for paying assessments. Districts shall be
responsible for payment of the assessments described in paragraphs (a)
and (b) of this section.
(d) Disposition of assessments. The administrative costs assessed
and collected pursuant to paragraphs (a) and (b) of this section will
be deposited to the general fund of the United States Treasury as
miscellaneous receipts.
(e) Assessment for administrative costs. The assessment for
administrative costs shall initially be set at $260. This is based on
an average of the direct and indirect costs the Bureau of Reclamation
incurs performing activities to obtain certification or reporting forms
from landholders that failed to submit such forms prior to receipt of
irrigation water and form corrections that are not submitted by the
designated due date. This initial $260 assessment for administrative
costs will be reviewed at least once every 5 years and adjusted, if
needed, to reflect new cost data based upon the Bureau's costs for
communicating with district representatives and landholders to obtain
missing or corrected forms; assisting landholders in completing
certification or reporting forms for the period of time they were not
in compliance with the form requirements; performing onsite visits to
determine if irrigation water deliveries have been terminated to
landholders that failed to submit the required forms; and performing
other activities necessary to address form violations. Notice of the
revised assessment for administrative costs will be published in the
Federal Register in December of the year the data are reviewed.
[FR Doc. 94-15509 Filed 6-27-94; 8:45 am]
BILLING CODE 4310-94-P
