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Criteria and Procedures for Proposed Assessment of Civil Penalties [09/08/2006]
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Volume 71, Number 174, Page 53054-53075
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DEPARTMENT OF LABOR
Mine Safety and Health Administration
30 CFR Part 100
RIN 1219-AB51
Criteria and Procedures for Proposed Assessment of Civil
Penalties
AGENCY: Mine Safety and Health Administration (MSHA), Labor.
ACTION: Proposed rule.
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SUMMARY: The Mine Safety and Health Administration (MSHA) is proposing
to amend its civil penalty regulations to increase penalty amounts and
to implement new requirements of the Mine Improvement and New Emergency
Response (MINER) Act of 2006 amendments to the Mine Safety and Health
Act of 1977 (Mine Act). In addition, MSHA is proposing to revise
procedures for proposing civil monetary penalties to improve the
efficiency and effectiveness of the civil penalty process. These
changes are intended to induce greater mine operator compliance with
the Mine Act and MSHA's safety and health standards and regulations,
thereby improving safety and health for miners.
DATES: MSHA must receive comments on or before October 23, 2006. MSHA
will hold six public hearings on September 26, 2006, September 28,
2006, October 4, 2006, October 6, 2006, October 17, 2006, and October
19, 2006. Details about the public hearings are in the SUPPLEMENTARY
INFORMATION section of this document.
ADDRESSES: Comments must be clearly identified with as such and may be
sent to MSHA by any of the following methods:
(1) Federal eRulemaking Portal: http: //http://www.regulations.gov. Follow
the instructions for submitting comments.
(2) Electronic mail: zzMSHA-comments@dol.gov. Include ``RIN 1219-
AB51'' in the subject line of the message.
(3) Telefax: (202) 693-9441. Include ``RIN 1219-AB51'' in the
subject.
(4) Regular Mail: MSHA, Office of Standards, Regulations, and
Variances, 1100 Wilson Blvd., Room 2350, Arlington, Virginia 22209-
3939.
(5) Hand Delivery or Courier: MSHA, Office of Standards,
Regulations, and Variances, 1100 Wilson Blvd., Room 2350, Arlington,
Virginia 22209-3939. Stop by the 21st floor and sign in at the
receptionist's desk.
Docket: Comments can be accessed electronically at http://www.msha.gov
under the ``Rules and Regs'' link. MSHA will post all comments on the
Internet without change, including any personal information provided.
Comments may also be reviewed at the Office of Standards, Regulations,
and Variances, 1100 Wilson Blvd., Room 2350, Arlington, Virginia.
MSHA maintains a listserv that enables subscribers to receive e-
mail notification when rulemaking documents are published in the
Federal Register. To subscribe to the listserv, go to http://www.msha.gov/subscriptions/subscribe.aspx
.
Hearings: Locations of the public hearings are in the SUPPLEMENTARY
INFORMATION section of this document.
FOR FURTHER INFORMATION CONTACT: Patricia W. Silvey, Acting Director,
Office of Standards, Regulations, and Variances, MSHA, 1100 Wilson
Blvd, Room 2350, Arlington, Virginia 22209-3939,
silvey.patricia@dol.gov (e-mail), (202) 693-9440 (voice), or (202) 693-
9441 (telefax).
SUPPLEMENTARY INFORMATION:
Outline:
I. Public Hearings
II. Background
A. General
B. Rulemaking History
III. Discussion and Analysis of Proposed Changes to Part 100
A. General Discussion
B. Section-by-Section Analysis
IV. Executive Order 12866
A. Population at Risk
B. Costs
C. Benefits
V. Feasibility
A. Technological Feasibility
B. Economic Feasibility
VI. Regulatory Flexibility Act and Small Business Regulatory
Enforcement Fairness Act (SBREFA)
A. Definition of Small Mine
B. Factual Basis for Certification
VII. Paperwork Reduction Act of 1995
VIII. Other Regulatory Considerations
A. The Unfunded Mandates Reform Act of 1995
B. Treasury and General Government Appropriations Act of 1999:
Assessment of Federal Regulations and Policies on Families
C. Executive Order 12630: Government Actions and Interference
With Constitutionally Protected Property Rights
D. Executive Order 12988: Civil Justice Reform
E. Executive Order 13045: Protection of Children From
Environmental Health Risks and Safety Risks
F. Executive Order 13132: Federalism
G. Executive Order 13175: Consultation and Coordination With
Indian Tribal Governments
I. Public Hearings
MSHA will hold six public hearings on the proposed rule. The
hearings will begin at 9 a.m., and will be held on the following dates
and locations:
[[Page 53055]]
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Date Location Phone
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September 26, 2006............ Mine Safety and (202) 693-9440
Health
Administration, 1100
Wilson Blvd, 25th
Floor, Conference
Room, Arlington,
Virginia 22209.
September 28, 2006............ Sheraton Birmingham, (205) 324-5000
2101 Richard
Arrington Jr. Blvd.,
North Birmingham,
Alabama 35203.
October 4, 2006............... Hilton Salt Lake City (801) 238-2999
Center, 255 South
West Temple, Salt
Lake City, Utah
84101.
October 6, 2006............... Hilton St. Louis (800) 314-2117
Airport, 10330
Natural Bridge Road,
St. Louis, Missouri
63134.
October 17, 2006.............. Charleston Marriott (304) 345-6500
Town Center, 200 Lee
Street East,
Charleston, West
Virginia 25301.
October 19, 2006.............. Pittsburgh Airport (412) 490-6602
Marriott, 777 Aten
Road, Coraopolis,
Pennsylvania 15108.
------------------------------------------------------------------------
Requests to speak at a hearing should be made at least five days
prior to the hearing dates. Requests to speak may be made by telephone
(202-693-9440), telefax (202) 693-9441, or mail (MSHA, Office of
Standards, Regulations, and Variances, 1100 Wilson Blvd., Rm. 2350,
Arlington, Virginia 22209-3939). Any unallocated time at the hearings
will be made available to persons making same-day requests to speak.
The hearings will begin with an opening statement from MSHA,
followed by an opportunity for members of the public to make oral
presentations to a hearing panel. Speakers will be assigned in the
order in which their requests are received. Speakers and other
attendees may present written information or other articles to the MSHA
panel for inclusion in the rulemaking record.
The hearings will be conducted in an informal manner. The hearing
panel may ask questions of speakers. Formal rules of evidence and cross
examination will not apply. The presiding official may limit
presentations and exclude irrelevant or unduly repetitious material and
questions to ensure the orderly progress of the hearings.
Transcripts of the hearings will be included in the rulemaking
record. Copies of the transcripts will be available to the public, and
can be viewed at http://www.msha.gov.
MSHA will accept post-hearing written comments and other
appropriate data for the record from any interested party, including
those not presenting oral statements. Comments must be received at MSHA
no later than October 23, 2006.
II. Background
A. General
The Mine Act requires MSHA to issue citations or orders to mine
operators for any violations of a mandatory health or safety standard,
rule, order, or regulation promulgated under the Mine Act. Upon issuing
a citation, the Secretary's authorized representative (inspector)
specifies a time for the violation to be abated. If the operator does
not abate the condition within the allowed time, the inspector may
extend the time to abate or issue an order requiring all persons to be
withdrawn from the area affected by the violation until the violation
is abated. The Mine Act further requires assessment of civil monetary
penalties for violations. Sections 105 and 110 of the Mine Act provide
for the assessment of these penalties. The following six criteria in
section 110(i) of the Mine Act are used to assess civil monetary
penalties:
(1) The appropriateness of the penalty to the size of the business
of the operator charged;
(2) The operator's history of previous violations;
(3) Whether the operator was negligent;
(4) The gravity of the violation;
(5) The demonstrated good faith of the operator charged in
attempting to achieve rapid compliance after notification of a
violation; and
(6) The effect of the penalty on the operator's ability to continue
in business.
MSHA proposes a civil penalty assessment for each violation. Upon
receipt of the proposed assessment, the mine operator or other person
has 30 days to contest the assessment before the Federal Mine Safety
and Health Review Commission (Commission), an independent adjudicatory
agency established under the Mine Act. A proposed assessment that is
not contested within 30 days becomes a final order of the Commission by
operation of law and will not be subject to review by any court or
agency. A proposed assessment that is contested before the Commission
is reviewed by the Commission de novo.
B. Rulemaking History
On May 30, 1978, MSHA published its first final rule pertaining to
the proposed assessment of civil penalties under the Mine Act for both
coal mines and metal and nonmetal mines (47 FR 22286). The maximum
civil penalty that MSHA could assess under the Mine Act at that time
was $10,000.
The 1978 rule consisted of a two-tiered system of assessing
proposed penalties under either a regular assessment or a special
assessment. Since 1978, MSHA has revised its civil penalty regulations
in 30 CFR part 100 essentially to: (1) Add a single penalty assessment
provision; (2) change the assessment process to conform to a court
order concerning history of violations; (3) increase penalty amounts
due to legislative action; and (4) change penalty amounts and processes
due to other compelling circumstances.
Under the existing regulations, MSHA proposes penalties using a
three-tiered process: (1) Regular assessments; (2) single penalty
assessments; and (3) special assessments. The maximum civil penalty
assessment is $60,000. The single penalty assessment is $60. The
maximum daily civil penalty which may be assessed for failure to
correct a violation within the time permitted is $6,500 and the maximum
penalty for smoking or carrying smoking materials underground is $275.
III. Discussion and Analysis of Proposed Changes to Part 100
A. General Discussion
MSHA is proposing to revise its procedures for assessing proposed
civil penalties to update and increase penalties for violations of the
standards and regulations promulgated under the Mine Act and to
implement new civil penalty requirements in the MINER Act (Pub. L. 109-
236). These new requirements address civil penalties related to prompt
incident notification, and flagrant and unwarrantable violations. In
accordance with MINER Act requirements, citations and orders issued on
or after June 16, 2006, will be subject to the minimum penalties
specified in the Act for violations involving failure to promptly
notify MSHA within 15 minutes and unwarrantable failure.
The intended purpose of civil penalties under the Mine Act is to
``convince operators to comply with the Act's requirements.'' (S. Rep.
No. 181, 95th Cong., 1st Sess. 45 (1977),
[[Page 53056]]
reprinted in Senate Subcommittee on Labor, Committee on Human
Resources, 95th Cong., 2d Sess., Legislative History of the Federal
Mine Safety and Health Act of 1977, at 633 (1978)). The Congress
intended that the imposition of civil penalties would induce mine
operators to be proactive in their approach to mine safety and health,
and take necessary action to prevent safety and health hazards before
they occur. In this proposal, the Agency is strengthening the civil
penalty assessment regulations which will be an important tool in the
reduction of fatalities and improvement in miner safety and health.
Under MSHA's existing procedures, a civil penalty can be assessed
under the single penalty provision, the regular assessment provision,
or the special assessment provision. The single penalty provision is
applied to most violations that are not reasonably likely to result in
a reasonably serious injury or illness (non-Significant and
Substantial, or non-S&S) and that are abated in a timely manner,
provided the operator does not have an excessive history of violations.
The single penalty assessment is currently $60.
The regular assessment is used to address most S&S violations,
i.e., those that are reasonably likely to result in a reasonably
serious injury or illness. Under the regular assessment provision,
penalty points are assigned based on five statutory criteria:
Operator's size, history, negligence, demonstrated good faith towards
abatement, and the gravity of the violation. The total points are then
converted into a dollar amount. The resulting amount constitutes the
proposed penalty unless, under the sixth statutory criterion, the
operator shows that the penalty would adversely affect its ability to
continue in business. Currently, the minimum regular assessment is $72
and the maximum regular assessment is $60,000 for each violation.
Under the existing rule, MSHA reviews eight categories of
violations for special assessment--those associated with fatalities as
well as those associated with other aggravating circumstances. These
are violations that MSHA believes, because of the particular
circumstances surrounding the violation, should not be processed as a
single penalty or regular assessment. The maximum special assessment is
currently $60,000.
MSHA reviewed the history of violations and penalty assessments at
mines which have experienced fatal accidents recently. At these mines,
MSHA found repeated violations of several standards for which the $60
single penalty was assessed. MSHA also reviewed violations at all
mines. The number of citations for violations of MSHA's standards and
regulations has been on the rise since 2003. Specifically, the number
of all violations assessed increased from 103,404 in 2003 to 116,731 in
2005. The number of violations that received a single penalty
assessment increased from 69,078 in 2003 to 75,394 in 2005; the number
of violations that received a regular assessment increased from 32,608
in 2003 to 37,968 in 2005; and the number of violations that received a
special assessment increased from 1,718 in 2003 to 3,369 in 2005.
MSHA is proposing to revise the civil penalty assessment process so
that proposed penalties will increase proportionately to increases in
operator size, history, and negligence and the gravity or seriousness
of the violation. To accomplish this, the proposed rule would:
(1) Reformulate the existing process of assigning points under the
regular assessment provision;
(2) Add a provision in an operator's history addressing repeat
violations;
(3) Delete the existing single penalty assessment provision;
(4) Revise the penalty conversion table by increasing the dollar
value of each point assigned under the regular assessment provision;
(5) Remove the limit on types of violations that MSHA will review
for possible special assessment by removing the list of specific
categories;
(6) Shorten the time allowed to request a conference; and
(7) Implement new requirements of the MINER Act.
MSHA is proposing to delete the single penalty assessment
provision. MSHA has reevaluated the single penalty provision and
believes that the proposed rule reflects a more appropriate and
effective approach to achieving the congressional purpose with respect
to civil monetary penalties.
MSHA is proposing to implement new penalty requirements in the
MINER Act for prompt incident notification and flagrant violations in
Sec. 100.5.
MSHA is proposing a new provision in Sec. 100.4 to implement MINER
Act requirements related to unwarrantable failure penalties. This
provision sets minimum penalties for any citation or order issued under
Sec. 104(d) of the Mine Act.
The proposed changes are intended to induce greater mine operator
compliance with the Mine Act and MSHA's safety and health standards,
thereby improving safety and health for miners. The proposed changes
are described in more detail in the following section-by-section
analysis.
B. Section-by-Section Analysis
1. Scope and Purpose (Sec. 100.1)
Existing Sec. 100.1 would not change.
2. Applicability (Sec. 100.2)
Existing Sec. 100.2 provides that the criteria and procedures in
this part apply to all ``evaluations and proposed assessments of civil
penalties.'' The proposed rule would remove the word ``evaluations''
because the process of proposing assessments includes evaluations. This
proposed section contains no substantive changes.
3. Determination of Penalty; Regular Assessment (Sec. 100.3)
a. General (Sec. 100.3(a)). Existing Sec. 100.3 establishes the
formula to apply the statutory criteria to violations that are not
processed under the existing single penalty assessment (Sec. 100.4) or
special assessment (Sec. 100.5) provisions. This formula is an
administrative mechanism used by MSHA to determine the appropriate
penalty by applying the statutory criteria to particular facts
surrounding a violation. Existing Sec. 100.3(a) lists the criteria
described in Sec. Sec. 105(b)(1)(B) and 110(i) of the Mine Act. The
proposed rule makes several editorial changes for clarification and
ease of reading, but makes no substantive changes to this section.
b. Appropriateness of the penalty to the size of the operator's
business (Sec. 100.3(b)). Existing Sec. 100.3(b) contains five tables
assigning penalty points for size of coal mines, controlling entities
of coal mines, metal and nonmetal mines, controlling entities of metal
and nonmetal mines, and independent contractors. The size of coal mines
and their controlling entities is measured by the amount of coal
production. The size of metal and nonmetal mines and their controlling
entities is measured by the number of hours worked. The size of
independent contractors is measured by the total number of hours worked
by the independent contractors at all mines regardless of the commodity
being mined.
Existing Sec. 100.3(b) assigns up to 10 penalty points for the
size of mines or independent contractors based on a scale which
consists of 11 levels. In addition, up to 5 penalty points are assigned
for the size of the controlling entity of a coal mine or a metal or
nonmetal mine.
MSHA is proposing editorial changes to Sec. 100.3(b) to make the
provision easier to read. MSHA is also proposing to clarify the
existing provision by
[[Page 53057]]
adding a statement concerning the way size of coal mines and metal and
nonmetal mines is determined. The existing provision only states how
the size of an independent contractor is determined. There are no
proposed changes to the point table addressing the size of controlling
entities.
MSHA is proposing to increase the number of penalty points based on
the operator's size. Tables III-1, III-2, and III-3 show both the
existing and proposed point schedules. The maximum number of penalty
points for size would increase from 10 to 20 to assure that the amount
of the penalty is an appropriate economic inducement of future
compliance by the operator. The proposed point increase is based on
MSHA's analysis of existing size data for coal operators, metal and
nonmetal operators, and independent contractors.
According to the 2005 data, nearly half of the existing coal mines
had annual tonnage of up to 15,000 tons. Slightly more than half of the
existing metal and nonmetal mines had fewer than 10,000 annual hours
worked. About half of independent contractors had fewer than 10,000
annual hours worked at all mines. Consistent with existing Sec.
100.3(b), MSHA proposes that coal mines with an annual tonnage of up to
15,000 tons, metal and nonmetal mines with fewer than 10,000 hours
worked, and independent contractors with fewer than 10,000 hours worked
at all mines would all receive 0 penalty points for this criterion.
Under the proposal, the remaining coal mines, i.e., those with
annual tonnage levels above 15,000 tons; the remaining metal and
nonmetal mines, i.e., those with annual hours worked above 10,000; and
the remaining independent contractors, i.e., those with annual hours
worked at all mines above 10,000, would receive twice as many penalty
points as under the existing rule, up to a maximum of 20.
The proposed size schedule would result in penalties that are, on
average, more than twice as high at the smallest (one to five
employees) coal mines than at metal and nonmetal mines of similar size
and over four times higher at coal mines in the five to 19 employee
size range than similar sized metal and non-metal mines.
The proposed point structure in paragraph (b) is designed so that
higher penalties would be computed for larger operations. This proposal
is consistent with the Mine Act's requirement to consider the size of
the operation when assessing penalties. MSHA believes penalties
assessed under the existing regulations are often too low to be an
effective deterrent for noncompliance at some of the largest
operations.
The proposal, like the existing rule, places greater emphasis on
size of the mine than on size of the controlling entity in assigning
penalty points. The Agency solicits comments on whether, in considering
the size of the operator, greater weight should be placed on the size
of the controlling entity.
Table III-1.--Size of Coal Mine: Annual Tonnage of Mine
------------------------------------------------------------------------
Existing Proposed
Annual tonnage of mine penalty penalty
points points
------------------------------------------------------------------------
0 to 15,000................................... 0 0
Over 15,000 to 30,000......................... 1 2
Over 30,000 to 50,000......................... 2 4
Over 50,000 to 100,000........................ 3 6
Over 100,000 to 200,000....................... 4 8
Over 200,000 to 300,000....................... 5 10
Over 300,000 to 500,000....................... 6 12
Over 500,000 to 800,000....................... 7 14
Over 800,000 to 1.1 million................... 8 16
Over 1.1 million to 2 million................. 9 18
Over 2 million................................ 10 20
------------------------------------------------------------------------
Table III-2.--Size of Metal and Nonmetal Mine: Annual Hours Worked at
Mine
------------------------------------------------------------------------
Existing Proposed
Annual hours worked at mine penalty penalty
points points
------------------------------------------------------------------------
0 to 10,000................................... 0 0
Over 10,000 to 20,000......................... 1 2
Over 20,000 to 30,000......................... 2 4
Over 30,000 to 60,000......................... 3 6
Over 60,000 to 100,000........................ 4 8
Over 100,000 to 200,000....................... 5 10
Over 200,000 to 300,000....................... 6 12
Over 300,000 to 500,000....................... 7 14
Over 500,000 to 700,000....................... 8 16
Over 700,000 to 1 million..................... 9 18
Over 1 million................................ 10 20
------------------------------------------------------------------------
Table III-3.--Size of Independent Contractor: Annual Hours Worked at All
Mines
------------------------------------------------------------------------
Existing Proposed
Annual hours worked at all mines penalty penalty
points points
------------------------------------------------------------------------
0 to 10,000................................... 0 0
Over 10,000 to 20,000......................... 1 2
Over 20,000 to 30,000......................... 2 4
[[Page 53058]]
Over 30,000 to 60,000......................... 3 6
Over 60,000 to 100,000........................ 4 8
Over 100,000 to 200,000....................... 5 10
Over 200,000 to 300,000....................... 6 12
Over 300,000 to 500,000....................... 7 14
Over 500,000 to 700,000....................... 8 16
Over 700,000 to 1 million..................... 9 18
Over 1 million................................ 10 20
------------------------------------------------------------------------
c. History of previous violations (Sec. 100.3(c)). Existing Sec.
100.3(c) bases the operator's violation history on the number of
violations received in a preceding 24-month period for which a civil
penalty has been paid or finally adjudicated. For production operators,
penalty points are calculated using the average number of violations
per inspection day (VPID). For independent contractors, penalty points
are calculated using the annual average number of violations at all
mines in a preceding 24-month period. The proposal would add the phrase
``or have become final orders of the Commission'' in the second
sentence of this paragraph. The proposal would retain MSHA's intent
that only violations which have become final be included in an
operator's history.
MSHA is proposing three several substantive changes to existing
Sec. 100.3(c). First, MSHA is proposing that violation history include
two components: (1) Paragraph (c)(1) would address the total number of
violations; and (2) paragraph (c)(2) would address the number of repeat
violations of the same standard. Second, an operator's or independent
contractor's history of violations would be based on a preceding 15-
month period rather than a 24-month period. This change would apply to
both components--overall history and repeat violations--of history.
Third, MSHA is proposing to change the point tables for overall history
and to add a new point table addressing repeat violations of the same
standard. Finally, MSHA is proposing to revise the calculation that
addresses the overall history of an independent contractor.
MSHA is proposing to reduce the 24-month review period to a 15-
month review period because the agency believes that a period of 15
months would more accurately reflect an operator's current state of
compliance. This change would provide MSHA with sufficient data to
appropriately determine an operator's compliance record, including any
trend, even for mining operations that are inspected on a less frequent
basis. This change would provide an incentive for improving safety and
health to an operator that has a deteriorating safety and health record
in the recent past.
Proposed Sec. 100.3(c)(1) addresses the overall history of
production operators and independent contractors. MSHA would continue
to assign penalty points for production operators based on the number
of assessed violations per inspection day. MSHA is proposing to
increase the points assigned to the five highest levels of the VPID
table. The highest level would be assigned the maximum of 25 points.
MSHA is proposing to increase penalty points starting from the ``over
1.3 to 1.5'' level or mid-level of the VPID table because MSHA believes
that operators of mines with a VPID in the mid- and upper levels show
the least concern for compliance with the Mine Act and MSHA safety and
health standards and regulations. Higher penalties for such operators
may encourage them to comply with the Mine Act's requirements.
Under proposed Sec. 100.3(c)(1), production operators with fewer
than 10 assessed violations in a preceding 15-month period would not
receive points. This proposed provision is similar to existing Sec.
100.4(b) pertaining to excessive history. The proposed provision takes
into consideration small mines that may receive a low number of
inspection days in a preceding 15-month period. In such small
operations, even though the total number of violations may be low, the
VPID could easily be greater than the highest 2.1 VPID level. These
small operations, however, are not necessarily the ones which MSHA is
targeting in this aspect of the history criterion, since such a record
may not reflect systemic problems of noncompliance. MSHA believes that
these small operators should not receive points under this aspect of
this criterion.
Under proposed Sec. 100.3(c)(1), the number of violations for
independent contractors would no longer be based on the average number
of assessed violations per year at all mines as it is under existing
Sec. 100.3(c). The number of violations for independent contractors
would be based on the total number of assessed violations at all mines
during a preceding 15-month period. Since the Agency proposes to reduce
the history time period from 24 to 15 months, this eliminates the need
for an annual average. MSHA estimates that this change may result in a
de minimis increase in the average assessment issued to independent
contractors. The proposed point table reflects this change. MSHA
solicits comments on this proposed approach to determining violation
history for independent contractors, i.e., whether an annualized
average should continue to be used. For independent contractors, MSHA
is proposing to increase the number of penalty points for the levels
starting with ``over 30 to 35'' and above and to increase the maximum
number of points for this aspect of the history criterion from 20 to
25. MSHA believes that independent contractors with a greater number of
violations in the preceding 15-month period show the least concern for
compliance with the Mine Act and MSHA safety and health standards and
regulations. MSHA intends that this aspect of the history criterion
would serve as greater inducement for such operators to comply with the
Mine Act and MSHA's safety and health standards and regulations. MSHA
therefore proposes to increase the points for the upper five levels of
the number of violations. See tables III-4 and III-5 for a comparison
of the existing and proposed penalty point scales for production
operators and independent contractors, respectively.
[[Page 53059]]
Table III-4.--Production Operator's Overall History of Violations:
Average Number of Violations per Inspection Day
------------------------------------------------------------------------
Existing Proposed
Violations per inspection day penalty penalty
points points
------------------------------------------------------------------------
0 to 0.3...................................... 0 0
Over 0.3 to 0.5............................... 2 2
Over 0.5 to 0.7............................... 4 4
Over 0.7 to 0.9............................... 6 6
Over 0.9 to 1.1............................... 8 8
Over 1.1 to 1.3............................... 10 10
Over 1.3 to 1.5............................... 12 13
Over 1.5 to 1.7............................... 14 16
Over 1.7 to 1.9............................... 16 19
Over 1.9 to 2.1............................... 18 22
Over 2.1...................................... 20 25
------------------------------------------------------------------------
Table III-5.--Independent Contractor's Overall History of Violations
------------------------------------------------------------------------
Existing Proposed
Number of violations penalty penalty
points points
------------------------------------------------------------------------
0 to 5........................................ 0 0
Over 5 to 10.................................. 2 2
Over 10 to 15................................. 4 4
Over 15 to 20................................. 6 6
Over 20 to 25................................. 8 8
Over 25 to 30................................. 10 10
Over 30 to 35................................. 12 13
Over 35 to 40................................. 14 16
Over 40 to 45................................. 16 19
Over 45 to 50................................. 18 22
Over 50....................................... 20 25
------------------------------------------------------------------------
Proposed Sec. 100.3(c)(2) would add a new component to the history
criterion: Repeat violations of the same standard. The number of repeat
violations of the same standard in a preceding 15-month period would be
part of the operator's history of violations. For the purpose of
determining repeat violations, each citable standard would be
considered a separate ``standard.'' Repeat violations of the same
standard would include only assessed violations of the relevant
standard that are paid or finally adjudicated, or became final orders
of the Commission. For example, previous assessments for violations of
Sec. 75.202(a) would not be included in the repeat history for a
violation of Sec. 75.202(b). Similarly, previous assessments for
violations of Sec. 56.14101(a)(1) would not be included in the repeat
history for a violation of Sec. 56.14101(a)(2). MSHA requests comments
on this approach to determining repeat violations. In addition, MSHA
solicits comments on whether, in determining penalty points for repeat
violations of the same standard, the Agency should factor in the number
of inspection days during which the repeat violations were cited. MSHA
also solicits comments on whether only S&S violations should be
considered in determining repeat violations of the same standard.
A maximum of 20 penalty points could be assigned using this new
component of the history criterion. MSHA is proposing this new
provision because the Agency believes that operators who repeatedly
violate the same standard may indicate an attitude which has little
regard for getting to the root cause of violations of safe and
healthful working conditions. The Agency believes that these operators
show a lack of commitment to good mine safety and health practices by
letting cited and corrected hazardous conditions recur.
The analysis of assessments for the 15-month period from January 1,
2005, through March 31, 2006 reveals that 698 of the 10,227 mines with
violations each had at least six violations of the same standard.
Furthermore, 99 of the 698 mines had more than twenty violations of the
same standard during the 15 month period. MSHA believes that the Agency
needs to adjust its civil penalty structure so that the penalties can
more appropriately serve as a deterrent to this type of behavior,
thereby resulting in greater compliance and more effective mine safety
and health.
Under proposed Sec. 100.3(c)(2), an operator with five or fewer
repeat violations of the same standard in a preceding 15-month period
would not receive penalty points. MSHA believes that that this new
component of the history criterion should be applied to those operators
who violate the same standard with a certain degree of repetition.
Under the proposal, operators could receive a maximum of 20 penalty
points for this aspect of the history criterion. MSHA believes that
this new proposal will encourage greater operator compliance with the
Mine Act and MSHA's safety and health standards and regulations, which
is consistent with Congress' intent.
Penalty points proposed to be assigned to the number of repeat
violations of the same standard are presented in Table III-6.
Table III-6.--New Table Addressing Repeat Violations of the Same
Standard
------------------------------------------------------------------------
Penalty
Number of violations points
------------------------------------------------------------------------
5 or fewer................................................... 0
6............................................................ 1
7............................................................ 2
8............................................................ 3
9............................................................ 4
10........................................................... 5
11........................................................... 6
12........................................................... 7
13........................................................... 8
14........................................................... 9
15........................................................... 10
16........................................................... 11
17........................................................... 12
18........................................................... 14
19........................................................... 16
20........................................................... 18
More than 20................................................. 20
------------------------------------------------------------------------
d. Negligence (Sec. 100.3(d)). Existing Sec. 100.3(d) provides
for evaluating the degree of negligence involved in a violation under 5
categories: No negligence, which means that the operator exercised
diligence and could not have known of the violative condition or
practice; low negligence, which means that the operator knew or should
have known of the violative condition or practice, but there are
considerable mitigating circumstances; moderate negligence, which means
that the operator knew or should have known of the violative condition
or practice, but there are mitigating circumstances; high negligence,
which means the operator knew or should have known of the violative
condition or practice, and there are no mitigating circumstances; and
reckless disregard, which means the operator displayed conduct which
exhibits the absence of the slightest degree of care. An increased
number of penalty points is assigned to the higher levels of
negligence. The maximum number of points for negligence is 25 under
existing Sec. 100.3(d).
Proposed Sec. 100.3(d) would retain the existing five levels of
negligence, but would increase the maximum number of penalty points
from 25 to 50 so that more penalty points would be assigned to
operators who exhibit increasingly higher levels of negligence, i.e., a
lack of care towards protection of miners from safety and health
hazards. Under the proposed table, points for no negligence and low
negligence would not change. Penalty points assigned under the three
highest levels of negligence would increase more rapidly than under the
existing regulation. Moderate negligence would add 20 points rather
than 15 points as under the existing regulation; high negligence would
add 35 points rather than the 20 points under the existing regulation;
and reckless disregard would add 50
[[Page 53060]]
points rather than 25 points as under the existing regulation.
Table III-7 compares penalty points in existing and proposed Sec.
100.3(d).
Table III-7.--Negligence
------------------------------------------------------------------------
Existing Proposed
Categories penalty penalty
points points
------------------------------------------------------------------------
No negligence................................. 0 0
(The operator exercised diligence and could
not have known of the violative condition or
practice.)
Low negligence................................ 10 10
(The operator knew or should have known of the
violative condition or practice, but there
are considerable mitigating circumstances.)
Moderate negligence........................... 15 20
(The operator knew or should have known of the
violative condition or practice, but there
are mitigating circumstances.)
High negligence............................... 20 35
(The operator knew or should have known of the
violative condition or practice, but there
are mitigating circumstances.)
Reckless disregard............................ 25 50
(The operator displayed conduct which exhibits
the absence of the slightest degree of care.)
------------------------------------------------------------------------
e. Gravity (Sec. 100.3(e)). Existing Sec. 100.3(e) uses three
factors to measure the gravity of a violation:(1) Likelihood of
occurrence of an event, (2) severity of injury or illness if the event
occurred or were to occur, and (3) the number of persons potentially
affected if the event occurred or were to occur. A maximum of 10
penalty points may be assigned from each of the three factors, for a
maximum of 30 points for the gravity criterion.
Proposed Sec. 100.3(e) would retain the three measures of gravity,
but would change the number of penalty points assigned for each. The
maximum number of points assigned for likelihood of occurrence of an
event would increase from 10 to 50, the maximum number of points
assigned for severity of injury or illness would increase from 10 to
20, and the maximum number of points assigned for the number of persons
potentially affected would increase from 10 to 18. In addition, the
number of categories in the Persons Potentially Affected Table would
increase from 7 to 11. The total points that could be assigned for the
gravity criterion would increase from 30 to 88.
MSHA is proposing to adjust the number of penalty points that may
be assigned under the gravity criterion to focus attention on the more
serious mine safety and health hazards. MSHA believes that the penalty
points in the proposed gravity tables will result in mine operators
placing greater emphasis on correcting the more serious violations
because they pose the greatest safety and health risk to miners. The
proposal distinguishes the less serious violations so that they would
receive an appropriate penalty under the regular assessment formula.
Existing Sec. 100.3(e) has also been reworded for easier reading.
Tables III-8 through III-10 show both the existing and the proposed
penalty points for likelihood, gravity, and persons potentially
affected.
Table III-8.--Likelihood
------------------------------------------------------------------------
Existing Proposed
Likelihood of occurrence penalty penalty
points points
------------------------------------------------------------------------
No likelihood................................. 0 0
Unlikely...................................... 2 10
Reasonably likely............................. 5 30
Highly likely................................. 7 40
Occurred...................................... 10 50
------------------------------------------------------------------------
Table III-9.--Severity
------------------------------------------------------------------------
Existing Proposed
Severity of injury or illness if the event penalty penalty
occurred or were to occur points points
------------------------------------------------------------------------
No lost work days............................. 0 0
(All occupational injuries and illnesses as
defined in 30 CFR part 50 except those listed
below.)
Lost work days or restricted duty............. 3 5
(Any injury or illness which would cause the
injured or ill person to lose one full day of
work or more after the day of the injury or
illness, or which would cause one full day or
more of restricted duty.)
Permanently disabling......................... 7 10
(Any injury or illness which would be likely
to result in the total or partial loss of the
use of any member or function of the body.)
Fatal......................................... 10 20
(Any work-related injury or illness resulting
in death, or which has a reasonable potential
to cause death.)
------------------------------------------------------------------------
[[Page 53061]]
Table III-10.--Persons Potentially Affected
------------------------------------------------------------------------
Number of persons potentially affected if the event occurred or were to
occur
-------------------------------------------------------------------------
Existing Proposed
Existing scale points Proposed scale points
------------------------------------------------------------------------
0............................ 0 0.............. 0
1............................ 1 1.............. 1
2............................ 2 2.............. 2
3............................ 4 3.............. 4
4 to 5....................... 6 4.............. 6
6 to 9....................... 8 5.............. 8
More than 9.................. 10 6.............. 10
........... 7.............. 12
........... 8.............. 14
........... 9.............. 16
........... 10 or more..... 18
------------------------------------------------------------------------
f. Demonstrated good faith of the operator in abating the violation
(Sec. 100.3(f)). Existing Sec. 100.3(f) allows for a 30% reduction in
the amount of a regular assessment where the operator abates the
violation within the time set by the inspector. When the operator does
not abate the violation within the time set by the inspector, 10
penalty points are assigned.
Proposed Sec. 100.3(f) would decrease the amount of the reduction
from 30% to 10% where an operator abates a violation within the time
set by the inspector. MSHA believes this is a more appropriate
reduction because operators are required by law to timely abate
violations.
MSHA is also proposing to delete the existing provision which
assigns ten additional penalty points where an operator does not abate
the violation within the specified time period. The Mine Act provides
two sanctions for failure to correct violations within the time set by
the inspector: Sec. 104(b) requires a withdrawal order, which
effectively shuts down production in the area affected, and Sec.
110(b) allows assessment of a daily penalty.
MSHA has reviewed the civil penalty assessment data for the last
several years and believes that the proposed 10% good faith reduction
is a more appropriate credit for mine operators who promptly correct
hazardous conditions.
g. Penalty conversion table (Sec. 100.3(g)). Existing Sec.
100.3(g) provides the penalty conversion table used to convert total
penalty points to a dollar amount. The existing dollar amounts range
from $72 to $60,000, and correspond to penalty points ranging from 20
or fewer to 100.
Under the proposed penalty conversion table, MSHA would retain the
statutory maximum penalty of $60,000, but would establish a new minimum
penalty of $112. The proposed dollar amounts would correspond to
penalty points ranging from 60 or fewer to 140.
The proposed penalty conversion table is derived by combining two
methods of converting points to dollars. There is a lower section (from
60 or fewer to 133 points) and an upper section (above 133 points) of
the proposed conversion table. The proposed table starts at $112 when
the number of points is 60 or fewer. Each additional point above 60 up
to 133 causes the dollar value to increase by a fixed 8.33%. The dollar
value assigned for 133 points is $38,387. Above 133 points the dollar
value increases by approximately $3,070 for each penalty point. The
maximum number of points is 140 and the maximum dollar value is
$60,000.
When applied to MSHA's 2005 assessment data, the penalty amounts
under the proposed conversion table increase generally as severity of
the violation and violation history increase. Section III of this
preamble provides data showing the increased penalty amounts under the
proposal. Table III-12 shows the existing and the proposed penalty
conversion tables.
Table III-12.--Existing and Proposed Penalty Point Conversion Tables
------------------------------------------------------------------------
Current Proposed
Current points penalties Proposed points penalties
------------------------------------------------------------------------
20 or fewer.................. $72 60 or fewer.... $112
21........................... 80 61............. 121
22........................... 87 62............. 131
23........................... 94 63............. 142
24........................... 101 64............. 154
25........................... 109 65............. 167
26........................... 120 66............. 181
27........................... 131 67............. 196
28........................... 142 68............. 212
29........................... 153 69............. 230
30........................... 164 70............. 249
31........................... 178 71............. 270
32........................... 193 72............. 293
33........................... 207 73............. 317
34........................... 221 74............. 343
35........................... 237 75............. 372
36........................... 254 76............. 403
37........................... 273 77............. 436
38........................... 291 78............. 473
[[Page 53062]]
39........................... 310 79............. 512
40........................... 327 80............. 555
41........................... 354 81............. 601
42........................... 383 82............. 651
43........................... 409 83............. 705
44........................... 437 84............. 764
45........................... 463 85............. 828
46........................... 500 86............. 897
47........................... 536 87............. 971
48........................... 629 88............. 1,052
49........................... 749 89............. 1,140
50........................... 878 90............. 1,235
51........................... 1,033 91............. 1,337
52........................... 1,198 92............. 1,449
53........................... 1,376 93............. 1,569
54........................... 1,566 94............. 1,700
55........................... 1,769 95............. 1,842
56........................... 2,003 96............. 1,995
57........................... 2,252 97............. 2,161
58........................... 2,515 98............. 2,341
59........................... 2,793 99............. 2,536
60........................... 3,086 100............ 2,748
61........................... 3,419 101............ 2,976
62........................... 3,770 102............ 3,224
63........................... 4,137 103............ 3,493
64........................... 4,521 104............ 3,784
65........................... 4,856 105............ 4,099
66........................... 5,099 106............ 4,440
67........................... 5,342 107............ 4,810
68........................... 5,585 108............ 5,211
69........................... 5,828 109............ 5,645
70........................... 6,071 110............ 6,115
71........................... 6,374 111............ 6,624
72........................... 6,678 112............ 7,176
73........................... 6,981 113............ 7,774
74........................... 7,285 114............ 8,421
75........................... 7,588 115............ 9,122
76........................... 7,892 116............ 9,882
77........................... 8,499 117............ 10,705
78........................... 9,106 118............ 11,597
79........................... 9,713 119............ 12,563
80........................... 10,321 120............ 13,609
81........................... 11,535 121............ 14,743
82........................... 12,749 122............ 15,971
83........................... 13,963 123............ 17,301
84........................... 15,177 124............ 18,742
85........................... 16,392 125............ 20,302
86........................... 18,213 126............ 21,993
87........................... 20,642 127............ 23,825
88........................... 23,070 128............ 25,810
89........................... 25,498 129............ 27,959
90........................... 27,927 130............ 30,288
91........................... 30,355 131............ 32,810
92........................... 33,391 132............ 35,543
93........................... 36,427 133............ 38,503
94........................... 39,462 134............ 41,574
95........................... 42,498 135............ 44,645
96........................... 45,533 136............ 47,716
97........................... 48,569 137............ 50,787
98........................... 51,605 138............ 53,858
99........................... 54,640 139............ 56,929
100.......................... 60,000 140 or more.... 60,000
------------------------------------------------------------------------
The range of points in the proposed conversion table to reflects
proposed changes in the individual criteria tables in proposed Sec.
100.3. The minimum penalty in the proposed conversion table would be
changed from $72 to $112. MSHA believes that this would represent a
reasonable adjustment for many of the violations processed under the
existing regulations as single penalty assessments. Typically, single
penalty assessments address non-S&S and paperwork type violations. The
maximum penalty would remain at $60,000 per violation.
[[Page 53063]]
h. Effect on operator's ability to remain in business (Sec.
100.3(h)). Existing Sec. 100.3(h) provides that MSHA presumes that the
operator's ability to continue in business will not be affected by
payment of a civil penalty. In addition, it provides that MSHA may
adjust the penalty if the operator submits information to MSHA
concerning the business financial status which shows that payment of
the penalty will adversely affect the operator's ability to continue in
business. MSHA is proposing several editorial changes for easier
reading and clarity, but there would be no substantive change to
existing Sec. 100.3(h).
4. Determination of Penalty; Single Penalty Assessment (Sec. 100.4)
Existing Sec. 100.4 provides for a $60 penalty for non-S&S
violations, i.e., those that are not reasonably likely to result in
reasonably serious injury or illness. The single penalty assessment is
available only if the violation is abated within the time set by the
inspector and the operator does not have an excessive history of
violations. The existing provision defines excessive violation history.
MSHA is proposing to delete the single penalty assessment provision
in Sec. 100.4 based on an evaluation of agency data and a review of
experience gained under the provision. The primary focus of the Mine
Act, as reiterated in the MINER Act, is on the prevention and
correction of violative conditions before they occur and the
improvement of the safety and health of miners. MSHA believes that
deletion of the single penalty provision will have a positive impact on
miner safety and health. MSHA believes that deleting the single penalty
provision will provide a greater incentive for mine operators to abate
hazards. The Agency believes that deleting the single penalty provision
will cause mine operators to focus their attention on preventing all
hazardous conditions before they occur and promptly correct those
violations that do occur. Therefore, MSHA is proposing to delete the
single penalty provision.
5. Unwarrantable Failure (Sec. 100.4)
Proposed Sec. 100.4 would implement the MINER Act requirements
related to minimum unwarrantable failure penalties. Section 8(a)(1)(B)
of the MINER Act amends the Mine Act by setting a minimum penalty of
$2,000 for any citation or order issued under section 104(d)(1) and a
minimum penalty of $4,000 for any order issued under section 104(d)(2).
6. Determination of Penalty; Special Assessment (Sec. 100.5)
Existing Sec. 100.5 provides for a special assessment for those
violations which MSHA believes should not be processed under the
provision for a single penalty assessment or under the regular
assessment provision.
Consistent with the proposal to delete the single penalty
provision, MSHA is proposing to revise the first sentence in paragraph
(a) of this section. The revision would remove the reference to the
single assessment provision. MSHA proposes to remove the second
sentence in existing paragraph (a) of Sec. 100.5 that provides a
general explanation stating when a special assessment would be applied.
This sentence is ``Although an effective penalty can generally be
derived by using the regular assessment formula and the single
assessment provision, some types of violations may be of such a nature
or seriousness that it is not possible to determine an appropriate
penalty under these provisions.'' This sentence is unnecessary because
the first sentence specifies that it is within MSHA's discretion to
waive the regular assessment depending upon the conditions surrounding
the violation.
MSHA proposes to remove the list of eight categories of violations
that will be reviewed for possible special assessment under existing
Sec. 100.5(b). As stated in existing and proposed Sec. 100.5(a), MSHA
has the discretion to waive the regular assessment formula if it
determines that conditions warrant a special assessment for any type of
violation. The existing list of eight categories of violations that
MSHA would review, although not intended to be exclusive, resulted in a
time-consuming and resource-intensive process. Under the proposed rule,
MSHA would retain its discretion to determine which types of violations
would be reviewed for a special assessment, without being limited to a
specific list. MSHA anticipates that, under the proposal, the regular
assessment provision would generally provide an appropriate penalty in
most cases. This change will allow MSHA to focus its enforcement
resources on more field enforcement activities, as opposed to
administrative review activities. There would be circumstances,
however, in which the regular assessment would not provide an
appropriate penalty and thus the special assessment provision would be
applied.
Changes in proposed Sec. 100.5(b) would provide for easier reading
and clarity and would be revised to include references to sections
105(b) and 110(i) of the Mine Act. The reference to Sec. 100.4(b)
would be removed as the single penalty provision would be deleted.
Paragraphs (c) and (d) would remain unchanged.
Proposed paragraphs (e) and (f) would implement new civil penalty
provisions of the MINER Act. New paragraph (e) addresses penalties for
flagrant violations. Under the MINER Act amendments to the Mine Act,
violations that are deemed to be flagrant may be assessed a civil
penalty of not more than $220,000. A ``flagrant'' violation is defined
as a reckless or repeated failure to make reasonable efforts to
eliminate a known violation of a mandatory health or safety standard
that substantially and proximately caused, or reasonably could have
been expected to cause, death or serious bodily injury. Under the
proposal these violations would be processed as a special assessment.
New paragraph (f) addresses penalties related to prompt incident
notification. Under the MINER Act amendments to the Mine Act, an
operator who fails to provide timely notification to the Secretary
under section 103(j) (relating to the 15-minute requirement) shall be
assessed a civil penalty of not less than $5,000 and not more than
$60,000. Violations under this new paragraph would be processed as a
special assessment.
7. Procedures for Review of Citations and Orders; Procedures for
Assessment of Civil Penalties and Conferences (Sec. 100.6)
Existing Sec. 100.6 contains requirements and administrative
procedures for review of citations and orders. Proposed Sec. 100.6
remains substantively the same as existing Sec. 100.6. MSHA believes
that safety and health is improved when mine operators and miners or
their representatives are afforded an opportunity to discuss safety and
health issues after an inspection with the MSHA District Manager or
designee. Like existing Sec. 100.6, initial review of the citation or
order would be conducted during the inspection closeout conference or
at a time reasonably convenient to operators and miners or their
representatives. In addition, the proposal, like the existing rule,
allows the operator and miners or their representative to submit
additional facts or to request a safety and health conference. Any of
these parties may request to be notified of, and participate in, a
safety and health conference initiated by one of the other parties.
Safety and health conference requests would continue to be made with
the MSHA District Office. When a request is
[[Page 53064]]
granted, conferences will be promptly conducted.
Proposed paragraph 100.6(a) contains editorial changes which
incorporate concepts from existing paragraphs 100.6(a) and (c). Under
proposed Sec. 100.6(a), the review process would continue to provide
any operator, and miners or their representatives, with an opportunity
to (1) review the citation or order with MSHA, (2) submit additional
information to MSHA, and (3) request a safety and health conference
with the District Manager or designee. In addition, the provision in
existing Sec. 100.6(c), which provides that a request for a conference
is within MSHA's discretion, would be moved to this paragraph.
Proposed Sec. 100.6(b) would reduce the time, from ten days to
five days, to submit additional information or request a safety and
health conference. MSHA believes that the proposed reduction would
result in a more effective civil penalty system because penalties would
be assessed closer in time to the issuance of the citation. MSHA
believes that all parties would be able to request a health and safety
conference within this timeframe.
As stated above, the provision in existing Sec. 100.6(c), which
provides that a request for a conference is within MSHA's discretion,
would be moved to proposed Sec. 100.6(a). Existing 100.6(d) would be
renumbered as Sec. 100.6(c) and otherwise remain unchanged.
Existing Sec. Sec. 100.6(e), (f), and (g) would be combined and
incorporated into proposed Sec. 100.6(d). The wording in paragraphs
(e) and (g) would be unchanged. Paragraph (f) would be clarified to
specify when the MSHA District managers are to refer citations and
orders to MSHA's Office of Assessments but would remain substantively
unchanged.
8. Notice of Proposed Penalty; Notice of Contest (Sec. 100.7)
Existing Sec. 100.7 provides for procedures applicable to a notice
of proposed penalty and notice of penalty contest. Existing paragraph
(a) sets out the circumstances under which a notice of proposed penalty
will be served on the parties, paragraph (b) sets out the procedures
for contesting a notice of proposed penalty, and paragraph (c) sets out
when a proposed penalty becomes a final order of the Commission.
Proposed Sec. 100.7(a), (b), and (c) include editorial changes for
ease of reading, but remain substantively unchanged from the existing
provision. Proposed Sec. 100.7(b) would remove from the regulatory
text: (1) The reference to a return mailing card that is used to
request a hearing before the Federal Mine Safety and Health Review
Commission, (2) the reference to providing instructions for returning
the card to MSHA, and (3) the provision that MSHA will immediately
advise the Commission of the contest and also advise the Office of the
Solicitor of the contest. MSHA is proposing these deletions because it
is no longer using a return mailing card. Instead, MSHA currently
provides a form that lists violations being assessed, instructions for
paying or contesting assessments, and MSHA contact information to
facilitate an operator's request for a hearing. MSHA intends to
continue this practice. MSHA would continue to advise the Office of the
Solicitor and the Commission of the notice of penalty contest.
9. Service (Sec. 100.8)
Existing Sec. 100.8 remains substantively unchanged. This section
provides that service of proposed civil penalties will be made at the
mailing address of record for an operator and miners' representative,
that penalty assessments may be mailed to a different address if MSHA
is notified in writing of the new address, and that operators who fail
to file a notification of legal identity under 30 CFR Part 41 will be
served at their last known business address. Specific references to
part 40 (Representative of Miners) and part 41 (Notification of Legal
Identity) would be changed to indicate they are parts contained in
Chapter I of Title 30 CFR.
IV. Executive Order 12866
Executive Order (E.O.) 12866 as amended by E.O. 13258 (Amending
Executive Order 12866 on Regulatory Planning and Review) requires that
regulatory agencies assess both the costs and benefits of regulations.
To comply with E.O. 12866, MSHA has prepared a Preliminary Regulatory
Economic Analysis (PREA) for the proposed rule. The PREA contains
supporting data and explanation for the summary materials presented in
sections IV-VII of this preamble, including the covered mining
industry, costs and benefits, feasibility, small business impacts, and
paperwork. The PREA is located on MSHA's Web site at http://www.msha.gov/REGSINFO.HTM.
A printed copy of the PREA can be obtained
from MSHA's Office of Standards, Regulations, and Variances.
Based on the PREA, MSHA has determined that the proposed rule would
not have an annual effect of $100 million or more on the economy and
that, therefore, it is not an economically ``significant regulatory
action'' pursuant to Section 3, paragraph (f) of E.O. 12866.
A. Population at Risk
Based on 2004 data, the proposed rule would apply to the entire
mining industry, covering all 14,480 mine operators and 6,693
independent contractors in the United States, as well as the 214,450
miners and 72,739 contract workers they employ.
B. Costs
In order to derive and explain the cost impact of the proposed rule
on the mining industry, MSHA has divided its analysis into three
sections: (1) The baseline--the total number and monetary amount of
civil penalty assessments proposed by MSHA in 2005, the year prior to
the proposed rule; (2) the impact of the proposed rule on civil penalty
assessments under the assumption that mine operators and independent
contractors take no actions, in response to higher proposed penalty
assessments, to increase compliance with MSHA standards and
regulations; and (3) the impact of the proposed rule on the number and
amount of civil penalty assessments taking into account the anticipated
response of mine operators and independent contractors to increase
compliance with MSHA standards and regulations and thereby reduce the
number of civil penalty assessments they would otherwise receive.
Before proceeding, it is important to note the nature of the
impacts associated with the proposed rule. For most MSHA rules, the
estimated impact reflects the cost to the mining industry of achieving
compliance with the rule. For this proposed rule, the estimated impact
consists of two parts: (1) Higher payments for penalties received and
(2) expenses incurred to increase compliance with MSHA standards and
regulations so as to reduce the number and amount of civil penalties
otherwise received. Although the former impact is not a traditional
compliance cost, but rather a cost specifically due to non-compliance,
for the purposes of this analysis, MSHA has shown these costs. The
latter costs are compliance costs, but for existing MSHA standards and
regulations. These costs were included in economic assumptions made
when those standards and regulations were promulgated. At that time,
MSHA generally assumed full industry compliance. Therefore, compliance
efforts made in response to higher penalties are not a cost
attributable to the proposed rule. However, for illustrative purposes
only, this analysis
[[Page 53065]]
reflects additional expenditures associated with improved compliance.
1. Baseline
The first step in estimating the impact of the proposed rule is to
establish a baseline: The number and monetary amount of civil penalty
assessments in the absence of the proposed rule. For this purpose, MSHA
chose all civil penalty assessments for 2005, the last full calendar
year of data prior to the proposed rule. Table IV-1 shows the number of
civil penalty assessments issued in 2005, disaggregated by mine
employment size, by coal and MNM, and by operators and independent
contractors.
Table IV-1.--Baseline Number of Civil Penalty Assessments for 2005
----------------------------------------------------------------------------------------------------------------
Coal-M/NM, operator/contractor
---------------------------------------------------------------------
Contractor/mine employment size Coal Coal M/NM M/NM All
contractor operator contractor operator violations
----------------------------------------------------------------------------------------------------------------
1-5....................................... 2,856 2,741 1,609 12,528 19,734
6-19...................................... 757 9,063 1,048 16,125 26,993
20-500.................................... 1,479 43,428 1,183 17,685 63,775
501+...................................... 1 4,432 66 1,672 6,171
All Mine Sizes............................ 5,093 59,664 3,906 48,010 116,673
----------------------------------------------------------------------------------------------------------------
The mine size and independent contractor size categories being used
are 1-5 employees, 6-19 employees, 20-500 employees, and more than 500
employees. These categories are relevant for the analysis of impacts in
section VI of this preamble, to determine whether small mines, as
defined by the Small Business Administration (SBA) and MSHA, would be
significantly impacted by the proposed rule. Mines with 500 or fewer
employees meet SBA's definition of a small mine. Mines with fewer than
20 employees meet MSHA's traditional definition of a small mine.
Mine violation data have been broken out by coal and metal/nonmetal
(MNM) and by operator and independent contractor. The employment sizes
shown are contractor size for independent contractors and mine size for
mine operators.
Of the 116,673 civil penalty assessments issued in 2005, 113,484,
or about 97.3%, were single penalty or regular assessments. The
remaining 3,189, or 2.7%, were special assessments.
As can be calculated from Table IV-1, there were about 25% more
coal violations than MNM violations in 2005, even though there were
more than 3\1/2\ times as many MNM operators and independent
contractors as there were coal operators and independent contractors.
One reason for the larger number of coal violations is that there are
about 3 times as many underground coal mines as underground MNM mines.
There are a number of circumstances surrounding underground mines which
tend to result in a greater number of violations. They are required to
be inspected more often, and conditions are generally more dangerous
and subject to change. Another reason for more coal violations is that
coal mines are, on average, larger operations than MNM mines, and
larger mines tend to receive more violations, on average, than smaller
mines. The average coal mine operator employed about 3 times as many
miners as the average MNM operator in 2004.
The 2005 civil penalty monetary amount used as a baseline was the
penalty proposed by MSHA. Table IV-2 shows, by contractor/mine
employment size and coal-MNM, operator-independent contractor, the
total baseline dollar amount of civil penalties proposed by MSHA in
2005.
Table IV-2.--Baseline Total of Proposed Civil Penalty Assessments for 2005
----------------------------------------------------------------------------------------------------------------
Coal-M/NM, operator/contractor
---------------------------------------------------------------------
Contractor/mine employment size Coal Coal M/NM M/NM All
contractor operator contractor operator violations
----------------------------------------------------------------------------------------------------------------
1-5....................................... $308,649 $463,277 $200,947 $1,887,443 $2,860,316
6-19...................................... 86,319 1,492,545 109,837 2,535,563 4,224,264
20-500.................................... 314,195 11,010,009 192,151 3,890,799 15,407,154
501+...................................... 2,000 1,706,750 14,876 634,888 2,358,514
All Mine Sizes............................ 711,163 14,672,581 517,811 8,948,693 24,850,248
----------------------------------------------------------------------------------------------------------------
Of the $24.9 million in civil penalties proposed by MSHA in 2005,
$16.6 million, or about 67%, were from single penalty and regular
assessments. The remaining $8.2 million were from special assessments.
Of this amount, about $0.3 million were issued to agents of mine
operators and another $1.5 million were issued for violations involving
a fatality.
Table IV-3 displays the baseline average dollar amount of a
proposed civil penalty in 2005 disaggregated by mine size and coal-MNM,
operator-independent contractor. The average penalty assessment for a
violation in 2005 was $213. For a regular or single penalty assessment,
the average penalty was $147. For a special assessment, the average
penalty was $2,385. For special assessments issued to agents of the
mine operator, the average assessment was $582, and for special
assessments involving a fatality, the average penalty was $27,181.
[[Page 53066]]
Table IV-3.--Baseline Average Proposed Civil Penalty Assessment per Violation in 2005
----------------------------------------------------------------------------------------------------------------
Coal-M/NM, operator contractor
---------------------------------------------------------------------
Contractor/mine employment size Average for
Coal Coal M/NM M/NM all
contractor operator contractor operator violations
----------------------------------------------------------------------------------------------------------------
1-5....................................... $108 $169 $125 $151 $145
6-19...................................... 114 165 105 157 156
20-500.................................... 212 254 162 220 242
501+...................................... 2,000 385 225 380 382
All Mine Sizes............................ 140 246 133 186 213
----------------------------------------------------------------------------------------------------------------
Consistent with the formulas used to calculate regular assessments
under the existing regulations, Table IV-3 shows that the average
proposed penalty assessment in 2005 tended to increase as mine size
increased. This effect is consistent, particularly for mine operators
with 20 or more employees.
Table IV-3 also indicates that the difference in average penalties
between coal and MNM mines and independent contractors of a given
employment size is generally small.
Table IV-2 reveals that total civil penalty assessments in 2005
were substantially larger, more than 50% larger, for coal mines than
for MNM mines. The larger aggregate penalty assessment for coal mines
is due to the larger number of violations issued to coal mines and the
higher average penalty per violation. Coal violations tend to be more
serious, on average, than MNM violations (e.g., 40% of coal violations
are Significant and Substantial, or S&S, versus 23% for MNM
violations).
2. Impacts If No Compliance Response to Higher Penalties
With the baseline established, the next task in the cost analysis
is to determine the impact of the proposed rule on civil penalty
assessments under the assumption that mine operators and independent
contractors take no actions, in response to higher proposed penalty
assessments, to increase compliance with MSHA standards and
regulations. This task is an intermediate step in determining the total
cost impact of the proposed rule, as MSHA's assumption in IV.B.3 of
this preamble is that mine operators and independent contractors will
change their compliance behavior in response to increased penalties.
Given the assumption of no compliance response by mine operators
and independent contractors, the number of violations would not change
in response to the proposed rule. They would remain the same as
presented in Table IV-1 for the baseline. However, the type of the
violations would change under the proposed rule. In the analysis, all
2005 regular and single penalty assessments would be issued as regular
assessments under the proposed rule. MSHA assumed that most
unwarrantable failure citations and orders would be processed as
regular assessments under the minimum penalty requirements of the MINER
Act. MSHA further assumed that the 2005 special assessments issued to
agents, those involving a fatality, those involving failure to promptly
notify MSHA, and those involving flagrant violations would be assessed
as special assessments under the proposed rule. MSHA assumed that all
other 2005 special assessments would be processed as regular
assessments. Thus, under the proposed rule, MSHA estimates that the
number of special assessments would decline by 85%, from 3,189 to 491.
MSHA anticipates that, under the proposal, the regular assessment
provision would generally provide an appropriate penalty in most cases.
Equally significant, this will allow MSHA to focus its enforcement
resources on more field enforcement activities, as opposed to
administrative review activities.
Tables IV-4 and IV-5 show the estimated total dollar amount and
average dollar amount, respectively, of civil penalties under the
proposed rule, assuming no compliance response by mine operators and
independent contractors. Table IV-6 shows, relative to the baseline,
the estimated percentage increase of civil penalties (both total and
average) under the proposed rule, assuming no compliance response by
mine operators and independent contractors. All of these tables are
disaggregated by contractor/mine employment size, coal-MNM, and
operator/contractor.
Table IV-4.--Total Proposed Civil Penalty Assessments Under Proposed Rule, Assuming No Compliance Response
----------------------------------------------------------------------------------------------------------------
Coal-M/NM, operator/contractor
---------------------------------------------------------------------
Contractor/mine employment size Coal Coal M/NM M/NM All
contractor operator contractor operator violations
----------------------------------------------------------------------------------------------------------------
1-5....................................... $414,826 $684,448 $410,544 $3,207,759 $4,717,577
6-19...................................... 133,074 2,287,667 187,432 4,744,450 7,352,623
20-500.................................... 415,811 37,598,722 340,542 8,365,383 46,720,458
501+...................................... 807 7,394,118 43,973 2,288,395 9,727,293
All Mine Sizes............................ 964,518 47,964,955 982,491 18,605,987 68,517,951
----------------------------------------------------------------------------------------------------------------
[[Page 53067]]
Table IV-5.--Average of Proposed Civil Penalty Assessments Under Proposed Rule, Assuming No Compliance Response
----------------------------------------------------------------------------------------------------------------
Coal-M/NM, operator/contractor
---------------------------------------------------------------------
Contractor/mine employment size Average for
Coal Coal M/NM M/NM all
contractor operator contractor operator violations
----------------------------------------------------------------------------------------------------------------
1-5....................................... $145 $250 $255 $256 $239
6-19...................................... 176 252 179 294 272
20-500.................................... 281 866 288 473 733
501+...................................... 807 1,668 666 1,369 1,576
All Mine Sizes............................ 189 804 252 388 587
----------------------------------------------------------------------------------------------------------------
Table IV-6.--Percentage Increase in Total and Average Proposed Civil Penalty Assessments Under Proposed Rule,
Assuming No Compliance Response
----------------------------------------------------------------------------------------------------------------
Coal-M/NM, operator/contractor
---------------------------------------------------------------------
Average
Contractor/mine employment size percentage
Coal Coal M/NM M/NM increase for
contractor operator contractor operator all
violations
----------------------------------------------------------------------------------------------------------------
1-5....................................... 34 48 104 70 65
6-19...................................... 54 53 71 87 74
20-500.................................... 32 241 77 115 203
501+...................................... -60 333 196 260 312
All Mine Sizes............................ 36 227 90 108 176
----------------------------------------------------------------------------------------------------------------
As indicated in these tables, MSHA estimates that total civil
penalty assessments would increase under the proposed rule, assuming no
compliance response, from $24.9 million in the baseline to $68.5
million, an increase of $43.7 million, or 176%. Approximately $2.5
million, or about 4% of the $68.5 million, would come from special
assessments. Of the $43.7 million increase, approximately $1.9 million
would result from the minimum penalty provisions for unwarrantable
violations in the MINER Act. In its analysis of 2005 data, MSHA found
one violation which met the failure to provide timely notification
provisions in the MINER Act. For this category of violations, the MINER
Act imposes a penalty of $5,000 to $60,000. However, the particular
violation had already received a special assessment in excess of
$5,000. Thus, MSHA did not adjust penalty totals to account for this
provision of the MINER Act.
MSHA has determined that flagrant violations will be processed
under the special assessment provision. As stated in the proposal, MSHA
will use the definition for flagrant violation in the MINER Act, but
the Agency cannot estimate, at this point in the rulemaking process,
the specific impact of this new requirement in the MINER Act. The
Agency does, however, anticipate that penalties will increase due to
this provision.
MSHA estimates that the average penalty assessment would increase
under the proposed rule, assuming no compliance response, from $213
(shown in Table IV-3) to $587 (shown in Table IV-5), an increase of
176% (shown in Table IV-6). Consistent with Congressional intent, the
average penalty generally increases as mine size or contractor size
increases (shown in Table IV-5).
For purposes of the analysis, special assessments that remain as
special assessments were assumed to receive the same penalty, unless
they would be impacted by the minimum penalty provisions of the MINER
Act. All special assessments in 2005 involving a fatality exceeded the
new minimum penalty provisions, so these penalties are assumed
unchanged by the proposed rule. However, the average penalty for
special assessments issued to agents of the mine operator is estimated
to increase by 367% under the proposed rule. This increase is entirely
due to the application of the minimum penalty provisions for
unwarrantable violations in the MINER Act.
For purposes of analysis, the remaining special assessments are
assumed to be treated as regular assessments under the proposal. In the
analysis, the average penalty for 2005 special assessments, assumed to
be issued as regular assessments under the proposed rule, increased by
84%.
3. Impacts With Compliance Response to Higher Penalties
MSHA intends and expects that higher penalty assessments will lead
to efforts by mine operators and independent contractors to increase
compliance with MSHA standards and regulations and ultimately to
decreased violations. MSHA assumes that each violation is associated
with a probability of occurrence that declines as penalty assessments
rise. To estimate this impact, MSHA assumes that each 10% increase in
penalty for a violation is associated with a 3% decrease in its
probability of occurrence.
In economic terms, this is equivalent to assuming an elasticity of
-0.3 between the number of violations and the dollar size of penalties.
The numbers derived from this elasticity assumption are for
illustrative purposes only. A lower elasticity number (e.g., -0.1)
would yield less impact and a higher number (e.g., -0.9) would yield
more impact. This elasticity of -0.3 was previously assumed by MSHA in
its regulatory economic analysis for the 2003 direct final rule to
adjust civil penalties for inflation. Further explanation and
mathematics are provided in the PREA for this proposed rule.
MSHA has consistently applied this assumption to each assessed
violation in the 2005 database. For most violations, the proposed rule
would result in a penalty increase. Accordingly, MSHA has computed a
reduction (or in the rare
[[Page 53068]]
case, an increase) in the probability of the violation's occurrence.
The reduction is larger as the penalty increases.
Tables IV-7 and IV-8 estimate the increased compliance response of
the industry to higher penalty assessments. Table IV-7 provides
estimates for mine operators and Table IV-8 provides estimates for
independent contractors. Tables IV-7 and IV-8 show, by mine or
contractor employment size and by coal and MNM, the number of
violations and the dollar amount of penalties in the 2005 database
(``Old''). Using the assumption that the elasticity of response is -0.3
for each violation, Tables IV-7 and IV-8 estimate the new reduced
number of violations and the higher penalties associated with these
violations (``New''). Taking into account the mine industry's
compliance response, MSHA estimates that were the proposed rule in
effect in 2005, total violations would have declined from 116,673 to
95,035, a reduction of about 19% in the total number of violations.
Table IV-7.--Impact of Proposed Rule on Mine Operators Given Increased Compliance Response to Higher Penalty Assessments
--------------------------------------------------------------------------------------------------------------------------------------------------------
Additional
Old number Old proposed New number New proposed Change in expenditures
Mine employment size of penalties of penalties penalties to improve
violations violations compliance*
--------------------------------------------------------------------------------------------------------------------------------------------------------
Impact on Coal Mine Operators
--------------------------------------------------------------------------------------------------------------------------------------------------------
1-5.............................................................. 2,741 $463,277 2,476 $566,992 $103,715 $44,449
6-19............................................................. 9,063 1,492,545 8,145 1,895,806 403,261 172,826
20-500........................................................... 43,428 11,010,009 33,616 23,661,984 12,651,975 5,422,275
501+............................................................. 4,432 1,706,750 2,941 4,356,873 2,650,123 1,135,767
--------------------------------------------------------------------------------------
All Mine Sizes............................................... 59,664 14,672,581 47,178 30,481,655 15,809,074 6,775,317
--------------------------------------------------------------------------------------------------------------------------------------------------------
Impact on Metal/Nonmetal Mine Operators
--------------------------------------------------------------------------------------------------------------------------------------------------------
1-5.............................................................. 12,528 $1,887,443 10,955 $2,562,832 675,389 $289,453
6-19............................................................. 16,125 2,535,563 13,846 3,632,672 1,097,109 470,190
20-500........................................................... 17,685 3,890,799 13,986 6,110,644 2,219,845 951,362
501+............................................................. 1,672 634,888 1,101 1,381,516 746,628 319,983
--------------------------------------------------------------------------------------
All Mine Sizes............................................... 48,010 8,948,693 39,889 13,687,664 4,738,971 2,030,988
--------------------------------------------------------------------------------------------------------------------------------------------------------
* These additional expenditures are shown for illustrative purposes only and are not included in the costs of this proposal, since they were included in
analyses of costs when standards were promulgated.
Table IV-8.--Impact of Proposed Rule on Independent Contractors Given Increased Compliance Response to Higher Penalty Assessments
--------------------------------------------------------------------------------------------------------------------------------------------------------
Additional
Old number Old proposed New number New Change in expenditures
Contractor employment size of penalties of proposed penalties to improve
violations violations penalties compliance*
--------------------------------------------------------------------------------------------------------------------------------------------------------
Impact on Coal Independent Contractors
--------------------------------------------------------------------------------------------------------------------------------------------------------
1-5.............................................................. 2,856 $308,649 2,607 $361,058 $52,409 $22,461
6-19............................................................. 757 86,319 678 113,178 26,859 11,511
20-500........................................................... 1,479 314,195 1,349 355,952 41,757 17,896
501+............................................................. 1 2,000 1 1,060 -940 -403
--------------------------------------------------------------------------------------
All Contractor Sizes......................................... 5,093 711,163 4,636 831,247 120,084 51,465
--------------------------------------------------------------------------------------------------------------------------------------------------------
Impact on Metal/Nonmetal Independent Contractors
--------------------------------------------------------------------------------------------------------------------------------------------------------
1-5.............................................................. 1,609 $200,947 1,377 $318,731 $117,784 $50,479
6-19............................................................. 1,048 109,837 905 150,508 40,671 17,430
20-500........................................................... 1,183 192,151 998 267,210 75,059 32,168
501+............................................................. 66 14,876 52 30,615 15,739 6,745
--------------------------------------------------------------------------------------
All Contractor Sizes......................................... 3,906 517,811 3,332 767,064 249,253 106,823
--------------------------------------------------------------------------------------------------------------------------------------------------------
* These additional expenditures are shown for illustrative purposes only and are not included in the costs of this proposal, since they were included in
analyses of costs when standards were promulgated.
The ``Change in Penalties'' column represents the increase in
penalties, relative to the baseline, for remaining violations. The
total change in proposed penalty assessments is approximately $15.8
million for coal mine operators, $0.1 million for coal independent
contractors, $4.7 million for MNM mine operators, and $0.2 million for
MNM independent contractors. The sum of these four numbers, $20.9
million, is the total cost of the proposed rule.
To reduce the number of violations in response to the higher
penalty assessments, MSHA assumes that mines will increase costs to
improve compliance. The column, ``Additional Expenditures to Improve
Compliance,''
[[Page 53069]]
represents MSHA's estimate of these increased compliance costs. These
estimates are based on the same assumption that the elasticity of
response is -0.3 and the additional assumption that the increased
compliance activities will be undertaken by the mining industry to
avoid increased penalties. These increased compliance costs to avoid
higher penalties are not counted as a cost of this proposed rule,
because full compliance with MSHA standards is assumed when standards
are promulgated.
Table IV-9 summarizes the impacts by mining sector.
Table IV-9.--Impact of Proposed Rule, Both With Unchanged Compliance and With Increased Compliance Response to
Higher Penalty Assessments
----------------------------------------------------------------------------------------------------------------
New proposed Change in Percent change
Mining sector Old proposed penalties, same penalties, same in penalties,
penalties compliance compliance same compliance
----------------------------------------------------------------------------------------------------------------
Same Number of Violations
----------------------------------------------------------------------------------------------------------------
Coal........................................ $15,383,744 $48,929,473 $33,545,729 218
Metal....................................... 1,396,682 4,054,371 2,657,689 190
Nonmetal.................................... 594,888 1,171,774 576,886 97
Sand and Gravel............................. 3,113,522 5,544,307 2,430,785 78
Stone....................................... 4,361,412 8,818,026 4,456,614 102
-------------------------------------------------------------------
Total................................... 24,850,248 68,517,951 43,667,703 176
----------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------
Additional New proposed Change in Percent change
expenditures to penalties, penalties, in penalties,
Mining sector improve improved improved improved
compliance* compliance compliance compliance
----------------------------------------------------------------------------------------------------------------
Reduced Number of Violations
----------------------------------------------------------------------------------------------------------------
Coal........................................ $6,826,782 $31,312,902 $15,929,158 104
Metal....................................... 524,403 2,620,288 1,223,606 88
Nonmetal.................................... 132,222 903,406 308,518 52
Sand and Gravel............................. 522,167 4,331,911 1,218,389 39
Stone....................................... 959,019 6,599,123 2,237,711 51
-------------------------------------------------------------------
Total................................... 8,964,592 45,767,630 20,917,382 84
----------------------------------------------------------------------------------------------------------------
* These additional expenditures are shown for illustrative purposes only and are not included in the costs of
this proposal, since they were included in analyses of costs when standards were promulgated.
C. Benefits
The benefits of the proposed rule are the reduced number of
injuries and fatalities that would result from increased compliance
with MSHA's health and safety standards and regulations in response to
higher penalty assessments. MSHA projects that higher penalties will
induce mine operators to reduce all safety and health violations. The
reduction in the number of violations, particularly S&S violations, or
those reasonably likely to result in reasonably serious injury or
illness, will reduce the number and severity of injuries and illnesses.
V. Feasibility
MSHA has concluded that the requirements of the proposed rule are
technologically and economically feasible.
A. Technological Feasibility
The proposed rule is a regulation, not a standard. It does not
involve activities on the frontiers of scientific knowledge. The mining
industry has been complying with the adjudication and payment of civil
penalties for decades. MSHA concludes, therefore, that the proposed
rule is technologically feasible.
B. Economic Feasibility
MSHA estimates that the yearly increased penalty assessments issued
to coal mines as a result of the proposed rule will be $15.9 million
dollars, which is equal to about 0.07 percent of coal mine sector
revenues of $22.1 billion in 2004. MSHA estimates that the yearly
increased penalty assessments issued to MNM mines as a result of the
proposed rule will be $5.0 million dollars, which is equal to about
0.01 percent of MNM mine sector revenues of $44.0 billion in 2004.
Since the total estimated increased penalty assessments for both the
coal and MNM mine sectors are well below one percent of their estimated
revenues, MSHA concludes that the proposed rule is economically
feasible for the mining industry.\1\
---------------------------------------------------------------------------
\1\ As shown earlier, in response to increased penalty
assessments, MSHA expects that coal mine operators and contractors
will spend an additional $6.8 million and MNM operators and
contractors an additional $2.1 million to increase compliance with
MSHA standards and regulations so as to reduce the number and amount
of civil penalty assessments otherwise received. But the costs to
achieve compliance with these standards and regulations have already
been estimated and recognized, under full compliance assumptions,
when the standards and regulations were promulgated. Therefore, the
costs associated with improved compliance are not properly
attributable to the proposed rule. To include them as a cost of the
proposed rule would be to double-count them.
---------------------------------------------------------------------------
VI. Regulatory Flexibility Act and Small Business Regulatory
Enforcement Fairness Act (SBREFA)
Pursuant to the Regulatory Flexibility Act (RFA) of 1980, as
amended by the Small Business Regulatory Enforcement Fairness Act
(SBREFA), MSHA has analyzed the impact of the proposed rule on small
entities. Based on that analysis, MSHA has made a determination with
respect to whether
[[Page 53070]]
the agency can certify that the proposed rule would not have a
significant economic impact on a substantial number of small entities.
Unless able to certify that the proposed rule would not have a
significant economic impact on a substantial number of small entities,
MSHA must develop an initial regulatory flexibility analysis.
MSHA certifies that the proposed rule would not have a significant
economic impact on a substantial number of small entities that are
covered by this rulemaking. The factual basis for this certification is
presented in full in Chapter V of the PREA and in summary form below.
A. Definition of a Small Mine
Under the RFA, in analyzing the impact of a rule on small entities,
MSHA must use the SBA definition for a small entity or, after
consultation with the SBA Office of Advocacy, establish an alternative
definition for the mining industry by publishing that definition in the
Federal Register for notice and comment. MSHA has not taken such an
action and hence is required to use the SBA definition. The SBA defines
a small entity in the mining industry as an establishment with 500 or
fewer employees.
MSHA has also examined the impacts of agency rules on a subset of
mines with 500 or fewer employees--those with fewer than 20 employees,
which MSHA and the mining community have traditionally referred to as
``small mines.'' These small mines differ from larger mines not only in
the number of employees, but also in economies of scale in material
produced, in the type and amount of production equipment, and in supply
inventory. Therefore, their costs of complying with MSHA's rules and
the impact of the agency's rules on them will also tend to be
different. It is for this reason that ``small mines,'' as traditionally
defined by MSHA as those employing fewer than 20 workers, are of
special concern to MSHA. In addition, for this proposed rule, MSHA has
examined the cost on mines with five or fewer employees to ensure that
this subset of mines is not significantly and adversely impacted by the
proposed rule.
This analysis complies with the requirements of the RFA for an
analysis of the impacts on ``small entities'' while continuing MSHA's
traditional definition of ``small mines.'' Both the proposal and this
analysis reflect MSHA's concern for mines with 5 or fewer employees.
MSHA concludes that it can certify that the proposed rule would not
have a significant economic impact on a substantial number of small
entities that are covered by this rulemaking. MSHA has determined that
this is the case for mines with fewer than 20 employees and mines with
500 or fewer employees. In its detailed factual basis below, MSHA will
also show effects of the proposal on mines with 5 or fewer employees.
B. Factual Basis for Certification
MSHA's analysis of impacts on ``small entities'' begins with a
``screening'' analysis. The screening compares the estimated costs of a
rule for small entities in the sector affected by the rule to the
estimated revenues for the affected sector. When estimated costs are
less than one percent of the estimated revenues, MSHA believes it is
generally appropriate to conclude that there is no significant economic
impact on a substantial number of small entities. When estimated costs
are equal to or exceed one percent of revenues, it tends to indicate
that further analysis may be warranted.
Normally, the analysis of the costs or economic impact of a rule
assumes that mine operators are in 100% compliance with a rule. Under
the assumption that mine operators are in 100% compliance with all of
MSHA's rules, there would be no cost of compliance with the proposed
rule, since no mine operator would be exposed to civil penalties. For
purposes of analyzing the effects on small mines, MSHA reverses this
usual assumption and instead analyzes the increased penalty assessments
for mines not in compliance with the agency's other rules.
For coal mines, estimated 2004 production was 4.6 million tons for
mines with 1-5 employees, 28.7 million tons for mines with 1-19
employees, and 896.8 million tons for mines with 1-500 employees. Using
the 2004 price of coal of $19.93 per ton, the 2004 coal revenues are
estimated to be approximately $91 million for mines with 1-5 employees,
$572 million for mines with 1-19 employees, and $17,872 million for
mines with 1-500 employees. Dividing the increase in penalties by the
revenues in each mine size category, the cost of the rule for coal
mines is 0.17% of revenues for mines with 1-5 employees, 0.10% of
revenues for mines with 1-19 employees, and 0.07% of revenues for mines
with 1-500 employees. Further details are shown in Table VI-1.
For MNM mines, the total 2004 revenue generated by the MNM industry
($44.0 billion) \2\ was divided by the total number of employee hours
to arrive at the average revenue per hour of employee production
($145.90). The $145.90 was multiplied by employee hours in specific
mine size categories to arrive at estimated revenues for these
categories. This approach was used to determine the estimated revenues
for the MNM mining industry because MSHA does not collect data on MNM
production. The 2004 MNM revenues are estimated to be approximately
$3.9 billion for mines with 1-5 employees, $15.4 billion for mines with
1-19 employees, and $40.6 billion for mines with 1-500 employees.
Dividing the increase in penalties by the revenues in each mine size
category, the cost of the rule for MNM mines is 0.02% of revenues for
mines with 1-5 employees, 0.01% of revenues for mines with 1-19
employees, and 0.01% of revenues for mines with 1-500 employees.
Further details are shown in Table VI-1.
---------------------------------------------------------------------------
\2\ U.S. Department of the Interior, U.S. Geological Survey,
Mineral Commodity Summaries 2005, January 2005, p. 8.
Table VI-1.--Increase in Penalties Due to Proposed Rule Compared to Mine Revenues, by Mine Size
----------------------------------------------------------------------------------------------------------------
Estimated Increase in Penalty
Employment size Number of Increase in revenue penalties per increase as %
mines penalties (millions) mine of revenue
----------------------------------------------------------------------------------------------------------------
Coal Mines
----------------------------------------------------------------------------------------------------------------
1-5 employees.................. 560 $156,124 $91 $279 0.17
1-19 employees................. 1,149 586,243 572 510 0.10
1-500 employees................ 2,000 13,279,975 17,872 6,640 0.07
[[Page 53071]]
All mines...................... 2,011 15,929,158 22,144 7,921 0.07
----------------------------------------------------------------------------------------------------------------
M/NM Mines
----------------------------------------------------------------------------------------------------------------
1-5 employees.................. 6,370 793,173 3,903 125 0.02
1-19 employees................. 10,771 1,930,953 15,379 179 0.01
1-500 employees................ 12,447 4,225,857 40,628 340 0.01
All mines...................... 12,467 4,988,224 44,000 400 0.01
----------------------------------------------------------------------------------------------------------------
As shown in Table VI-1, when applying MSHA's and SBA's definitions
of small mines, yearly costs of the proposed rule are substantially
less than 1 percent of estimated yearly revenues, well below the level
suggesting that the rule might have a significant economic impact on a
substantial number of small entities. Accordingly, MSHA has certified
that the proposed rule would not have a significant economic impact on
a substantial number of small entities that are covered by the rule.
VII. Paperwork Reduction Act of 1995
The proposed rule contains no information collections subject to
review by the Office of Management and Budget (OMB) under the Paperwork
Reduction Act.
VIII. Other Regulatory Considerations
A. The Unfunded Mandates Reform Act of 1995
The proposed rule does not include any Federal mandate that may
result in increased expenditures by State, local, or tribal
governments; nor does it increase private sector expenditures by more
than $100 million annually; nor does it significantly or uniquely
affect small governments. Accordingly, the Unfunded Mandates Reform Act
of 1995 (2 U.S.C. 1501 et seq.) requires no further agency action or
analysis.
B. Treasury and General Government Appropriations Act of 1999:
Assessment of Federal Regulations and Policies on Families
The proposed rule would have no effect on family well-being or
stability, marital commitment, parental rights or authority, or income
or poverty of families and children. Accordingly, Section 654 of the
Treasury and General Government Appropriations Act of 1999 (5 U.S.C.
601 note) requires no further agency action, analysis, or assessment.
C. Executive Order 12630: Government Actions and Interference With
Constitutionally Protected Property Rights
The proposed rule would not implement a policy with takings
implications. Accordingly, Executive Order 12630, Governmental Actions
and Interference with Constitutionally Protected Property Rights,
requires no further agency action or analysis.
D. Executive Order 12988: Civil Justice Reform
The proposed rule was drafted and reviewed in accordance with
Executive Order 12988, Civil Justice Reform. The proposed rule was
written to provide a clear legal standard for affected conduct and was
carefully reviewed to eliminate drafting errors and ambiguities, so as
to minimize litigation and undue burden on the Federal court system.
MSHA has determined that the proposed rule would meet the applicable
standards provided in Section 3 of Executive Order 12988.
E. Executive Order 13045: Protection of Children From Environmental
Health Risks and Safety Risks
The proposed rule would have no adverse impact on children.
Accordingly, Executive Order 13045, Protection of Children from
Environmental Health Risks and Safety Risks, as amended by Executive
Orders 13229 and 13296, requires no further agency action or analysis.
F. Executive Order 13132: Federalism
The proposed rule does not have ``federalism implications'' because
it does not ``have substantial direct effects on the States, on the
relationship between the national government and the States, or on the
distribution of power and responsibilities among the various levels of
government.'' Accordingly, Executive Order 13132, Federalism, requires
no further agency action or analysis.
G. Executive Order 13175: Consultation and Coordination With Indian
Tribal Governments
The proposed rule does not have ``tribal implications'' because it
does not ``have substantial direct effects on one or more Indian
tribes, on the relationship between the Federal government and Indian
tribes, or on the distribution of power and responsibilities between
the Federal government and Indian tribes.'' Accordingly, Executive
Order 13175, Consultation and Coordination with Indian Tribal
Governments, requires no further agency action or analysis.
H. Executive Order 13211: Actions Concerning Regulations That
Significantly Affect Energy Supply, Distribution, or Use
The proposed rule has been reviewed for its impact on the supply,
distribution, and use of energy because it applies to the coal mining
industry. Insofar as the proposed rule will result in added yearly
civil penalty assessments of approximately $15.9 million to the coal
mining industry, relative to annual revenues of $22.1 billion in 2004,
it is not a ``significant energy action'' because it is not ``likely to
have a significant adverse effect on the supply, distribution, or use
of energy * * * (including a shortfall in supply, price increases, and
increased use of foreign supplies).'' Accordingly, E.O. 13211, Actions
Concerning Regulations That Significantly Affect Energy Supply,
Distribution, or Use, requires no further Agency action or analysis.
I. Executive Order 13272: Proper Consideration of Small Entities in
Agency Rulemaking
MSHA has thoroughly reviewed the proposed rule to assess and take
appropriate account of its potential impact on small businesses, small
governmental jurisdictions, and small organizations. MSHA has
determined
[[Page 53072]]
and certified that the proposed rule would not have a significant
economic impact on a substantial number of small entities.
List of Subjects in 30 CFR Part 100
Mine safety and health, Penalties.
Dated: September 5, 2006.
David G. Dye,
Acting Assistant Secretary for Mine Safety and Health.
For the reasons set forth in the preamble, MSHA proposes to revise
30 CFR part 100 to read as follows:
PART 100--CRITERIA AND PROCEDURES FOR PROPOSED ASSESSMENT OF CIVIL
PENALTIES
Sec.
100.1 Scope and purpose.
100.2 Applicability.
100.3 Determination of penalty amount; regular assessment.
100.4 Unwarrantable failure.
100.5 Determination of penalty; special assessment.
100.6 Procedures for review of citations and orders; procedures for
assessment of civil penalties and conferences.
100.7 Notice of proposed penalty; notice of contest.
100.8 Service.
Authority: 30 U.S.C. 815, 820, and 957; Pub. L. 109-236, 120
Stat. 493.
Sec. 100.1 Scope and purpose.
This part provides the criteria and procedures for proposing civil
penalties under sections 105 and 110 of the Federal Mine Safety and
Health Act of 1977 (Mine Act). The purpose of this part is to provide a
fair and equitable procedure for the application of the statutory
criteria in determining proposed penalties for violations, to maximize
the incentives for mine operators to prevent and correct hazardous
conditions, and to assure the prompt and efficient processing and
collection of penalties.
Sec. 100.2 Applicability.
The criteria and procedures in this part are applicable to all
proposed assessments of civil penalties for violations of the Mine Act
and the standards and regulations promulgated pursuant to the Mine Act,
as amended. MSHA shall review each citation and order and shall make
proposed assessments of civil penalties.
Sec. 100.3 Determination of penalty amount; regular assessment.
(a) General. (1) The operator of any mine in which a violation
occurs of a mandatory health or safety standard or who violates any
other provision of the Mine Act, shall be assessed a civil penalty of
not more than $60,000. Each occurrence of a violation of a mandatory
safety or health standard may constitute a separate offense. The amount
of the proposed civil penalty shall be based on the criteria set forth
in sections 105(b) and 110(i) of the Mine Act. These criteria are:
(i) The appropriateness of the penalty to the size of the business
of the operator charged;
(ii) The operator's history of previous violations;
(iii) Whether the operator was negligent;
(iv) The gravity of the violation;
(v) The demonstrated good faith of the operator charged in
attempting to achieve rapid compliance after notification of a
violation; and
(vi) The effect of the penalty on the operator's ability to
continue in business.
(2) A regular assessment is determined by first assigning the
appropriate number of penalty points to the violation by using the
appropriate criteria and tables set forth in this section. The total
number of penalty points will then be converted into a dollar amount
under the penalty conversion table in paragraph (g) of this section.
The penalty amount will be adjusted for demonstrated good faith in
accordance with paragraph (f) of this section.
(b) The appropriateness of the penalty to the size of the business
of the operator charged. The appropriateness of the penalty to the size
of the production operator's business is calculated by using both the
size of the mine cited and the size of the controlling entity of the
mine. The size of coal mines and their controlling entities is measured
by coal production. The size of metal and nonmetal mines and their
controlling entities is measured by hours worked. The size of
independent contractors is measured by the total hours worked at all
mines. Penalty points for size are assigned based on Tables I to V of
this section. As used in these tables, the terms ``annual tonnage'' and
``annual hours worked'' mean coal produced and hours worked in the
previous calendar year. In cases where a full year of data is not
available, the coal produced or hours worked is prorated to an annual
basis. This criterion accounts for a maximum of 25 penalty points.
Table I.--Size of Coal Mine
------------------------------------------------------------------------
Penalty
Annual tonnage of mine points
------------------------------------------------------------------------
0 to 15,000.................................................. 0
Over 15,000 to 30,000........................................ 2
Over 30,000 to 50,000........................................ 4
Over 50,000 to 100,000....................................... 6
Over 100,000 to 200,000...................................... 8
Over 200,000 to 300,000...................................... 10
Over 300,000 to 500,000...................................... 12
Over 500,000 to 800,000...................................... 14
Over 800,000 to 1.1 million.................................. 16
Over 1.1 million to 2 million................................ 18
Over 2 million............................................... 20
------------------------------------------------------------------------
Table II.--Size of Controlling Entity--Coal Mine
------------------------------------------------------------------------
Penalty
Annual tonnage points
------------------------------------------------------------------------
0 to 100,000................................................. 0
Over 100,000 to 700,000...................................... 1
Over 700,000 to 1.5 million.................................. 2
Over 1.5 million to 5 million................................ 3
Over 5 million to 10 million................................. 4
Over 10 million.............................................. 5
------------------------------------------------------------------------
Table III.--Size of Metal/Nonmetal Mine
------------------------------------------------------------------------
Penalty
Annual hours worked at mine points
------------------------------------------------------------------------
0 to 10,000.................................................. 0
Over 10,000 to 20,000........................................ 2
Over 20,000 to 30,000........................................ 4
Over 30,000 to 60,000........................................ 6
Over 60,000 to 100,000....................................... 8
Over 100,000 to 200,000...................................... 10
Over 200,000 to 300,000...................................... 12
Over 300,000 to 500,000...................................... 14
Over 500,000 to 700,000...................................... 16
Over 700,000 to 1 million.................................... 18
Over 1 million............................................... 20
------------------------------------------------------------------------
Table IV.--Size of Controlling Entity--Metal/Nonmetal Mine
------------------------------------------------------------------------
Penalty
Annual hours worked points
------------------------------------------------------------------------
0 to 60,000.................................................. 0
Over 60,000 to 400,000....................................... 1
Over 400,000 to 900,000...................................... 2
Over 900,000 to 3 million.................................... 3
Over 3 million to 6 million.................................. 4
Over 6 million............................................... 5
------------------------------------------------------------------------
Table V.--Size of Independent Contractor
------------------------------------------------------------------------
Penalty
Annual hours worked at all mines points
------------------------------------------------------------------------
0 to 10,000.................................................. 0
Over 10,000 to 20,000........................................ 2
Over 20,000 to 30,000........................................ 4
Over 30,000 to 60,000........................................ 6
Over 60,000 to 100,000....................................... 8
Over 100,000 to 200,000...................................... 10
[[Page 53073]]
Over 200,000 to 300,000...................................... 12
Over 300,000 to 500,000...................................... 14
Over 500,000 to 700,000...................................... 16
Over 700,000 to 1 million.................................... 18
Over 1 million............................................... 20
------------------------------------------------------------------------
(c) History of previous violations. An operator's history of
previous violations is based on both the total number of violations and
the number of repeat violations of the same standard in a preceding 15-
month period. Only assessed violations that have been paid or finally
adjudicated, or have become final orders of the Commission will be
included in determining an operator's history.
(1) Total number of violations. For production operators, penalty
points are calculated on the basis of the number of violations per
inspection day (VPID)(Table VI of this section). Penalty points are not
calculated for mines with fewer than ten violations in the specified
history period. For independent contractors, penalty points are
calculated on the basis of the total number of violations at all mines
(Table VII of this section). This aspect of the history criterion
accounts for a maximum of 25 penalty points.
Table VI.--Mine Operators
------------------------------------------------------------------------
Penalty
Violations per inspection day points
------------------------------------------------------------------------
0 to 0.3..................................................... 0
Over 0.3 to 0.5.............................................. 2
Over 0.5 to 0 7.............................................. 4
Over 0.7 to 0.9.............................................. 6
Over 0.9 to 1.1.............................................. 8
Over 1.1 to 1.3.............................................. 10
Over 1.3 to 1.5.............................................. 13
Over 1.5 to 1.7.............................................. 16
Over 1.7 to 1.9.............................................. 19
Over 1.9 to 2.1.............................................. 22
Over 2.1..................................................... 25
------------------------------------------------------------------------
Table VII.--Independent Contractors
------------------------------------------------------------------------
Penalty
Number of violations points
------------------------------------------------------------------------
0 to 5....................................................... 0
Over 5 to 10................................................. 2
Over 10 to 15................................................ 4
Over 15 to 20................................................ 6
Over 20 to 25................................................ 8
Over 25 to 30................................................ 10
Over 30 to 35................................................ 13
Over 35 to 40................................................ 16
Over 40 to 45................................................ 19
Over 45 to 50................................................ 22
Over 50...................................................... 25
------------------------------------------------------------------------
(2) Repeat violations of the same standard. Repeat violation
history is based on the number of violations of the same standard. This
aspect of the history criterion accounts for a maximum of 20 penalty
points (Table VIII of this section).
Table VIII.--Repeat Violations of the Same Standard
------------------------------------------------------------------------
Penalty
Number of violations points
------------------------------------------------------------------------
5 or fewer................................................... 0
6............................................................ 1
7............................................................ 2
8............................................................ 3
9............................................................ 4
10........................................................... 5
11........................................................... 6
12........................................................... 7
13........................................................... 8
14........................................................... 9
15........................................................... 10
16........................................................... 11
17........................................................... 12
18........................................................... 14
19........................................................... 16
20........................................................... 18
More than 20................................................. 20
------------------------------------------------------------------------
(d) Negligence. Negligence is conduct, either by commission or
omission, which falls below a standard of care established under the
Mine Act to protect miners against the risks of harm. Under the Mine
Act, an operator is held to a high standard of care. A mine operator is
required to be on the alert for conditions and practices in the mine
that affect the safety or health of miners and to take steps necessary
to correct or prevent hazardous conditions or practices. The failure to
exercise a high standard of care constitutes negligence. The negligence
criterion assigns penalty points based on the degree to which the
operator failed to exercise a high standard of care. When applying this
criterion, MSHA considers mitigating circumstances which may include,
but are not limited to, actions taken by the operator to prevent or
correct hazardous conditions or practices. This criterion accounts for
a maximum of 50 penalty points, based on conduct evaluated according to
Table IX of this section.
Table IX.--Negligence
------------------------------------------------------------------------
Penalty
Categories points
------------------------------------------------------------------------
No negligence................................................ 0
(The operator exercised diligence and could not have known of
the violative condition or practice.)
Low negligence............................................... 10
(The operator knew or should have known of the violative
condition or practice, but there are considerable mitigating
circumstances.)
Moderate negligence.......................................... 20
(The operator knew or should have known of the violative
condition or practice, but there are mitigating
circumstances.)
High negligence.............................................. 35
(The operator knew or should have known of the violative
condition or practice, and there are no mitigating
circumstances.)
Reckless disregard........................................... 50
(The operator displayed conduct which exhibits the absence of
the slightest degree of care.)
------------------------------------------------------------------------
(e) Gravity. Gravity is an evaluation of the seriousness of the
violation. This criterion accounts for a maximum of 88 penalty points,
as derived from the Tables X through XII of this section. Gravity is
determined by:
(1) The likelihood of the occurrence of the event against which a
standard is directed;
(2) The severity of the illness or injury if the event occurred or
were to occur; and
(3) The number of persons potentially affected if the event
occurred or were to occur.
Table X.--Likelihood
------------------------------------------------------------------------
Penalty
Likelihood of occurrence points
------------------------------------------------------------------------
No likelihood................................................ 0
Unlikely..................................................... 10
Reasonably likely............................................ 30
Highly likely................................................ 40
Occurred..................................................... 50
------------------------------------------------------------------------
Table XI.--Severity
------------------------------------------------------------------------
Severity of injury or illness if the event occurred or were Penalty
to occur points
------------------------------------------------------------------------
No lost work days............................................ 0
(All occupational injuries and illnesses as defined in 30 CFR
part 50 except those listed below.)
Lost work days or restricted duty............................ 5
[[Page 53074]]
(Any injury or illness which would cause the injured or ill
person to lose one full day of work or more after the day of
the injury or illness, or which would cause one full day or
more of restricted duty.)
Permanently disabling........................................ 10
(Any injury or illness which would be likely to result in the
total or partial loss of the use of any member or function
of the body.)
Fatal........................................................ 20
(Any work-related injury or illness resulting in death, or
which has a reasonable potential to cause death.)
------------------------------------------------------------------------
Table XII.--Persons Potentially Affected
------------------------------------------------------------------------
Number of persons potentially affected if the event occurred Penalty
or were to occur points
------------------------------------------------------------------------
0............................................................ 0
1............................................................ 1
2............................................................ 2
3............................................................ 4
4............................................................ 6
5............................................................ 8
6............................................................ 10
7............................................................ 12
8............................................................ 14
9............................................................ 16
10 or more................................................... 18
------------------------------------------------------------------------
(f) The demonstrated good faith of the operator in abating
violation. This criterion provides a 10% reduction in the penalty
amount of a regular assessment where the operator abates the violation
within the time set by the inspector.
(g) Penalty conversion table. The penalty conversion table is used
to convert the total penalty points to a dollar amount.
Table XIII.--Penalty Conversion Table
------------------------------------------------------------------------
Penalty
Points ($)
------------------------------------------------------------------------
60 or fewer.................................................. 112
61........................................................... 121
62........................................................... 131
63........................................................... 142
64........................................................... 154
65........................................................... 167
66........................................................... 181
67........................................................... 196
68........................................................... 212
69........................................................... 230
70........................................................... 249
71........................................................... 270
72........................................................... 293
73........................................................... 317
74........................................................... 343
75........................................................... 372
76........................................................... 403
77........................................................... 436
78........................................................... 473
79........................................................... 512
80........................................................... 555
81........................................................... 601
82........................................................... 651
83........................................................... 705
84........................................................... 764
85........................................................... 828
86........................................................... 897
87........................................................... 971
88........................................................... 1,052
89........................................................... 1,140
90........................................................... 1,235
91........................................................... 1,337
92........................................................... 1,449
93........................................................... 1,569
94........................................................... 1,700
95........................................................... 1,842
96........................................................... 1,995
97........................................................... 2,161
98........................................................... 2,341
99........................................................... 2,536
100.......................................................... 2,748
101.......................................................... 2,976
102.......................................................... 3,224
103.......................................................... 3,493
104.......................................................... 3,784
105.......................................................... 4,099
106.......................................................... 4,440
107.......................................................... 4,810
108.......................................................... 5,211
109.......................................................... 5,645
110.......................................................... 6,115
111.......................................................... 6,624
112.......................................................... 7,176
113.......................................................... 7,774
114.......................................................... 8,421
115.......................................................... 9,122
116.......................................................... 9,882
117.......................................................... 10,705
118.......................................................... 11,597
119.......................................................... 12,563
120.......................................................... 13,609
121.......................................................... 14,743
122.......................................................... 15,971
123.......................................................... 17,301
124.......................................................... 18,742
125.......................................................... 20,302
126.......................................................... 21,993
127.......................................................... 23,825
128.......................................................... 25,810
129.......................................................... 27,959
130.......................................................... 30,288
131.......................................................... 32,810
132.......................................................... 35,543
133.......................................................... 38,503
134.......................................................... 41,574
135.......................................................... 44,645
136.......................................................... 47,716
137.......................................................... 50,787
138.......................................................... 53,858
139.......................................................... 56,929
140 or more.................................................. 60,000
------------------------------------------------------------------------
(h) The effect of the penalty on the operator's ability to continue
in business. MSHA presumes that the operator's ability to continue in
business will not be affected by the assessment of a civil penalty. The
operator may, however, submit information to the District Manager
concerning the financial status of the business. If the information
provided by the operator indicates that the penalty will adversely
affect the operator's ability to continue in business, the penalty may
be reduced.
Sec. 100.4 Unwarrantable failure.
(a) The minimum penalty for any citation or order issued under
section 104(d)(1) of the Mine Act shall be $2,000.
(b) The minimum penalty for any order issued under section
104(d)(2) of the Mine Act shall be $4,000.
Sec. 100.5 Determination of penalty amount; special assessment.
(a) MSHA may elect to waive the regular assessment under Sec.
100.3 if it determines that conditions warrant a special assessment.
(b) When MSHA determines that a special assessment is appropriate,
the proposed penalty will be based on the six criteria set forth in
Sec. 100.3(a). All findings shall be in narrative form.
(c) Any operator who fails to correct a violation for which a
citation has been issued under section 104(a) of the Mine Act within
the period permitted for its correction may be assessed a civil penalty
of not more than $6,500 for each day during which such failure or
violation continues.
(d) Any miner who willfully violates the mandatory safety standards
relating to smoking or the carrying of smoking materials, matches, or
lighters shall be subject to a civil penalty which shall not be more
than $275 for each occurrence of such violation.
(e) Violations that are deemed to be flagrant under section
110(a)(2) of the Mine Act may be assessed a civil penalty of not more
than $220,000. For purposes of this section, a flagrant violation means
``a reckless or repeated failure to make reasonable efforts to
eliminate a known violation of a mandatory health or safety standard
that substantially and proximately caused, or reasonably could have
been expected to cause, death or serious bodily injury.''
(f) The penalty for failure to provide timely notification to the
Secretary under section 103(j) of the Mine Act will be not less than
$5,000 and not more than $60,000 for the following accidents:
(1) The death of an individual at the mine, or
[[Page 53075]]
(2) An injury or entrapment of an individual at the mine which has
a reasonable potential to cause death.
Sec. 100.6 Procedures for review of citations and orders; procedures
for assessment of civil penalties and conferences.
(a) All parties shall be afforded the opportunity to review with
MSHA each citation and order issued during an inspection. It is within
the sole discretion of MSHA to grant a request for a conference and to
determine the nature of the conference.
(b) Upon notice by MSHA, all parties will have five days within
which to submit additional information or request a safety and health
conference with the District Manager or designee. A conference request
may include a request to be notified of, and to participate in, a
conference initiated by another party.
(c) When a conference is conducted, the parties may submit any
additional relevant information relating to the violation, either prior
to or at the conference. To expedite the conference, the official
assigned to the case may contact the parties to discuss the issues
involved prior to the conference.
(d) MSHA will consider all relevant information submitted in a
timely manner by the parties with respect to the violation. When the
facts warrant a finding that no violation occurred, the citation or
order will be vacated. Upon conclusion of the conference, or expiration
of the conference request period, all citations that are abated and all
orders will be promptly referred to MSHA's Office of Assessments. The
Office of Assessments will use the citations, orders, and inspector's
evaluation as the basis for determining the appropriate amount of a
proposed penalty.
Sec. 100.7 Notice of proposed penalty; notice of contest.
(a) A notice of proposed penalty will be issued and served by
certified mail upon the party to be charged and by regular mail to the
representative of miners at the mine after the time permitted to
request a conference under Sec. 100.6 expires, or upon the completion
of a conference, or upon review by MSHA of additional information
submitted in a timely manner.
(b) Upon receipt of the notice of proposed penalty, the party
charged shall have 30 days to either:
(1) Pay the proposed assessment. Acceptance by MSHA of payment
tendered by the party charged will close the case.
(2) Notify MSHA in writing of the intention to contest the proposed
penalty. When MSHA receives the notice of contest, it advises the
Federal Mine Safety and Health Review Commission (``Commission'') of
such notice. No proposed penalty which has been contested before the
Commission shall be compromised, mitigated or settled except with the
approval of the Commission.
(c) If the proposed penalty is not paid or contested within 30 days
of receipt, the proposed penalty becomes a final order of the
Commission and is not subject to review by any court or agency.
Sec. 100.8 Service.
(a) All operators are required by part 41 (Notification of Legal
Identity) of this chapter to file with MSHA the name and address of
record of the operator. All representatives of miners are required by
part 40 (Representative of Miners) of this chapter to file with MSHA
the mailing address of the person or organization acting in a
representative capacity. Proposed penalty assessments delivered to
those addresses shall constitute service.
(b) If any of the parties choose to have proposed penalty
assessments mailed to a different address, the Office of Assessments
must be notified in writing of the new address. Delivery to this
address shall also constitute service.
(c) Service for operators who fail to file under part 41 of this
chapter will be upon the last known business address recorded with
MSHA.
[FR Doc. 06-7512 Filed 9-5-06; 1:11 pm]
BILLING CODE 4510-43-U
