Federal Register, Volume 77 Issue 43 (Monday, March 5, 2012)

[Federal Register Volume 77, Number 43 (Monday, March 5, 2012)]
[Proposed Rules]
[Pages 13027-13043]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2012-4993]

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DEPARTMENT OF TRANSPORTATION

Federal Aviation Administration

14 CFR Part 16

[Docket No.: FAA-2012-0176; Notice No. 12-01]
RIN 2120-AJ97

Rules of Practice for Federally-Assisted Airport Enforcement
Proceedings (Retrospective Regulatory Review)

AGENCY: Federal Aviation Administration (FAA), DOT.

ACTION: Notice of proposed rulemaking (NPRM).

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SUMMARY: This action would update, simplify, and streamline rules of
practice and procedure for filing and adjudicating complaints against
federally-assisted airports. It would improve efficiency by enabling
parties to file submissions with the Federal Aviation Administration
(FAA) electronically, and by incorporating modern business practices
into how the FAA handles complaints. This amendment is necessary to
reflect changes in applicable laws and regulations, and to apply
lessons learned since the existing rules were implemented in 1996.

DATES: Send comments on or before May 4, 2012.

ADDRESSES: Send comments identified by docket number FAA-2012-0176
using any of the following methods:
Federal eRulemaking Portal: Go to http://www.regulations.gov and follow the online instructions for sending your
comments electronically.
Mail: Send comments to Docket Operations, M-30; U.S.
Department of Transportation (DOT), 1200 New Jersey Avenue SE., Room
W12-140, West Building Ground Floor, Washington, DC 20590-0001.
Hand Delivery or Courier: Take comments to Docket
Operations in Room W12-140 of the West Building Ground Floor at 1200
New Jersey Avenue SE., Washington, DC, between 9 a.m. and 5 p.m.,
Monday through Friday, except Federal holidays.
Fax: Fax comments to Docket Operations at 202-493-2251.
Privacy: The FAA will post all comments it receives, without
change, to http://www.regulations.gov, including any personal
information the commenter provides. Using the search function of the
docket Web site, anyone can find and read the electronic form of all
comments received into any FAA docket, including the name of the
individual sending the comment (or signing the comment for an
association, business, labor union, etc.). DOT's complete Privacy Act
Statement can be found in the Federal Register published on April 11,
2000 (65 FR 19477-19478), as well as at http://DocketsInfo.dot.gov.
Docket: Background documents or comments received may be read at
http://www.regulations.gov at any time. Follow the online instructions
for accessing the docket or go to Docket Operations in Room W12-140 of
the West Building Ground Floor at 1200 New Jersey Avenue SE.,
Washington, DC, between 9 a.m. and 5 p.m., Monday through Friday,
except Federal holidays.

FOR FURTHER INFORMATION CONTACT: For technical or legal questions
concerning this action, contact Jessie Di Gregory, Federal Aviation
Administration, Office of the Chief Counsel, Airport Law Branch (AGC-
610), 800 Independence Avenue SW., Washington, DC 20591; telephone
(202) 267-3199; fax (202) 267-5769; email: Jessie.DiGregory@faa.gov.

SUPPLEMENTARY INFORMATION:

Authority for This Rulemaking

The FAA's authority to issue rules on aviation safety is found in
Title 49 of the United States Code. Subtitle I, Section 106 describes
the authority of the FAA Administrator. Subtitle VII, Aviation
Programs, describes in more detail the scope of the agency's authority.
This rulemaking is promulgated under the authority described in
Subtitle VII, Part A, Sections 46101, ``Complaint and Investigations''
and 46104, ``Evidence,'' and Part B, Section 47122, ``Administrative.''
Under these sections, Congress provided for the FAA

[[Page 13028]]

to prescribe regulations for practices, methods, and procedures to hear
complaints concerning compliance by federally-assisted airports and
carry out investigations and conduct proceedings in a way conducive to
justice and the proper dispatch of business. This rulemaking is within
the scope of that authority because it would amend rules necessary to
investigate, hear, and provide rulings on matters related to federally-
assisted airport conduct.

I. Overview of the Proposed Rule

The FAA is required by statute to adjudicate complaints on matters
within the agency's authority (49 U.S.C. 46014). Title 14 CFR part 16,
Rules of Practice for Federally-Assisted Airport Enforcement
Proceedings (Part 16), provides a process for investigating and
adjudicating complaints against sponsors for violation of federal
obligations. For this NPRM, a sponsor is a recipient of federal
assistance, usually an airport operator. This rulemaking would improve
the efficiency of Part 16 proceedings by providing an electronic filing
alternative, opportunities for sponsors to seek early disposition of
complaints in certain cases, and clarification of processes already
described in the rule. It would affect those parties involved in filing
and responding to formal complaints. It would also affect the FAA
offices involved in investigating and adjudicating those complaints.
The FAA, sponsors, aeronautical users, and other stakeholders have
15 years of experience with Part 16 as implemented in 1996.\1\ In
general, Part 16 has been a useful process for resolving complaints
regarding sponsor compliance. The FAA does not intend to change the
basic features of the process. Rather, the FAA has identified updates
to Part 16 that could improve the process and reduce time required to
address certain cases, based on agency and stakeholder lessons learned.
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\1\ 61 FR 53998, October 16, 1996.
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The FAA believes the agency, sponsors, aeronautical users, and
other stakeholders in Part 16 proceedings would benefit from adding the
following to the rule:
Procedures for concluding the investigation by ``summary
judgment'' or dismissal without an answer by the sponsor.
Termination of complainant standing in certain cases where
the FAA finds the sponsor in noncompliance on all issues raised in the
complaint.
Optional electronic filing procedures.
Procedures for filing complaints under Title 49 CFR part
23, Participation of Disadvantaged Business Enterprises (DBEs) in
Airport Concessions, and 49 CFR part 26, Participation by DBEs in
Department of Transportation (DOT) Financial Assistance Programs.

In addition, the FAA believes it would be helpful to clarify existing
language in Part 16 that addresses \2\--
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\2\ This list is one of general introductions. It is not
intended to explain each issue in detail.
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Intervention and other participation.
The process for ordering corrective action for
noncompliant sponsors.
Processes involving the Director, including procedures for
seeking rehearing of Director's Determinations upon a showing of good
cause.
Standard of Proof and Burden of Proof requirements.
Standards for raising new issues on appeal to the
Associate Administrator.
Consent Orders.
Requests for testimony of agency employees.
Processes involving the Associate Administrator, including
procedures for seeking rehearing of Final Agency Decisions upon a
showing of good cause.
Transfer of responsibility for decision-making for civil
rights cases.
Availability of Judicial Review.
Extension of the time period for filing pleadings by mail.

Finally, the FAA is proposing minor updates to terminology and
organization within Part 16 as part of its revision. These changes are
necessary to streamline the rule and reflect current practices.
The FAA expects benefits of these proposed changes to include a
decrease in both time spent and volume of paper documents required to
process Part 16 complaints.

II. Background

A. Current Part 16 Procedures

Part 16 provides a specific procedure for filing and adjudicating
formal complaints against sponsors where these complaints involve
violations of federal obligations incurred as a condition of receiving
federal assistance. Federal assistance is either a grant from the FAA,
or transferred surplus or non-surplus federal property received by a
sponsor for airport purposes.
Sponsors agree to a list of standard conditions, or grant
assurances, when accepting a grant.\3\ Similar requirements also attach
to the transfer of federal surplus property to sponsors and are often
specified as obligations in surplus property deeds.\4\ Persons directly
and substantially affected by an alleged violation of one of these
assurances and/or obligations may file a complaint under Part 16 for
resolution.\5\ The sponsor must file an answer and may include a motion
to dismiss the complaint in the answer. The complainant may then file a
reply to the answer. The sponsor may then file a rebuttal. Through this
process the complainant and the sponsor each have the opportunity to
file written statements with the FAA.
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\3\ 49 U.S.C. 47101 et seq.
\4\ 49 U.S.C. 47151-47153.
\5\ A person filing under the authority provided in 49 CFR part
26, Participation by Disadvantaged Business Enterprises in
Department of Transportation Financial Assistance Programs, Sec.
26.105(c) need not be directly and substantially affected by the
sponsor's alleged violation.
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The FAA Administrator has delegated authority to take action and
issue orders for airport matters to the FAA Chief Counsel and the
Associate Administrator for Airports.\6\ The authority includes the
responsibility of investigating and adjudicating complaints against
sponsors. In practice, the Airports and Environmental Law Division
(AGC-600), the Airports line of business' Office of Airport Compliance
and Management Analysis (ACO), and, in cases involving alleged civil
rights violations, the FAA Office of Civil Rights (ACR), review the
complaint.\7\ The Airports and Environmental Law Division reviews the
complaint to ensure it meets the basic filing and docketing
requirements of Part 16.\8\ The Airports and Environmental Law Division
coordinates its docketing or dismissal with the Office of Airport
Compliance and Management Analysis. The Airports and Environmental Law
Division also reviews Director's Determinations and Final Agency
Decisions for legal sufficiency. A legal sufficiency review assesses
legal standards and includes consideration of whether the document
substantially satisfies applicable procedural and regulatory
requirements.
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\6\ FAA Order 1100.154A, Delegations of Authority, para.
6.e.(1), June 12, 1990.
\7\ The Airports Line of Business' Office of Airport Safety and
Standards (AAS) delegated certain authority involving Part 16
complaints that allege civil rights violations to ACR through a 2002
Memorandum of Understanding (MOU) from the AAS Director to the
Deputy Assistant Administrator for Civil Rights. See Albuquerque
Valet Service, et al., v. City of Albuquerque, FAA Docket No. 16-01-
01, at 3 n.2 (Director's Determination August 2, 2002).
\8\ See 14 CFR part 16, subparts A, B, and C.
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The Director of the Office of Airport Compliance and Management
Analysis,

[[Page 13029]]

the Deputy Assistant Administrator for the Office of Civil Rights, or
their respective designee (``Director'') either dismisses the
complaint, or conducts an investigation and issues a Director's
Determination. If the Director's Determination includes a finding of
noncompliance, it generally requires corrective action to return the
sponsor to compliance. A sponsor may be entitled to a hearing on the
Director's Determination. Either party may appeal the Director's
Determination, or, if a hearing is held, the hearing officer's initial
decision. A party makes such an appeal to the Associate Administrator
for Airports or the Assistant Administrator for Civil Rights, as
appropriate, for issuance of a Final Agency Decision. A party may then
file an appeal of the Final Agency Decision to a United States Court of
Appeals.

B. History

The FAA published an NPRM in 1994 (the 1994 NPRM) first proposing
to set up specific rules of practice for the filing of complaints and
adjudication of compliance matters involving federally-assisted
airports.\9\ The resulting Final Rule, published in 1996 (the 1996
Final Rule), addressed exclusively airport compliance matters arising
under the Airport and Airway Improvement Act (AAIA) of 1982, as amended
and recodified; certain airport-related provisions of the Federal
Aviation Act of 1958, as amended; the Surplus Property Act, as amended;
predecessors to those acts; and rules, grant agreements, and documents
of conveyance issued or made under those acts.\10\ Before 1996, the FAA
handled complaints filed against sponsors under the agency's general
complaint procedures in 14 CFR part 13, Investigative and Enforcement
Procedures (Part 13). The FAA had found these processes to be
cumbersome and inefficient for addressing complaints against airports
involving financial assistance matters. Amending Part 13 and
establishing Part 16 provided a dedicated procedure to the airport
community for resolution of such complaints. The informal complaint
procedures of Part 13 (Sec. 13.1), however, may be utilized to
facilitate a Part 16 complainant meeting the pre-complaint resolution
requirements of 14 CFR 16.21. Under that section, potential
complainants are required to engage in good faith efforts to resolve
the disputed matter informally with potentially responsible respondents
before filing a formal Part 16 complaint. Informal resolution may
include mediation, arbitration, use of a dispute resolution board, or
other form of third party assistance, including assistance from the
responsible FAA ADO or regional airports division. When filing a Part
16 complaint, the complainant must certify that good faith efforts have
been made to achieve informal resolution. In our experience, the
informal resolution process has been effective in bringing both parties
together in a timely manner to resolve differences and
misunderstandings about the rights and responsibilities of the airport
sponsor and the aeronautical user.
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\9\ 59 FR 29880, June 9, 1994.
\10\ 61 FR 53998, October 16, 1996.
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In 1999, DOT cited the FAA's Part 16 procedures when it established
49 CFR part 26, Participation by Disadvantaged Business Enterprises
(DBEs), in DOT Financial Assistance Programs.\11\ Title 49 CFR
26.105(c) allows any person who knows of a violation of this part by a
recipient of FAA funds to file a complaint under 14 CFR part 16. A
person filing a Part 16 complaint under the authority provided in 49
CFR 26.105(c) is accorded the same processes as any party filing under
Part 16, but need not be directly and substantially affected by the
sponsor's alleged violation.
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\11\ 64 FR 5126, February 2, 1999.
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On July 5, 2001, the Director of Airport Safety and Standards
issued a Notice of Limited Delegation in which he transferred authority
to the Associate Administrator for Civil Rights to serve as
``Director'' in accordance with 14 CFR 16.31 for a specific case.\12\
The Notice went on to say that most Part 16 complaints address issues
within the Director of Airport Safety and Standards' expertise, but
that complaints filed by DBEs under 49 CFR parts 23 and 26 are more
properly handled by the Office of Civil Rights because of that office's
expertise in such matters. The Notice also specifically limited the
delegation to the subject case, although it concluded by stating that a
final delegation of authority would be included in an upcoming
amendment to 14 CFR part 16.
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\12\ See Albuquerque Valet Service, et al., v. City of
Albuquerque, FAA Docket No. 16-01-01, at 3 n.2 (Director's
Determination August 2, 2002).
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Subsequently, on February 22, 2002, the Director of the Office of
Airport Safety and Standards and the Associate Administrator for
Airports each issued memoranda delegating blanket authority in civil
rights violations to the Deputy Assistant Administrator for Civil
Rights and the Assistant Administrator for Civil Rights, respectively.
These memoranda delegated authority to prepare and issue Director's
Determinations pursuant to 14 CFR 16.31 and final decisions pursuant to
14 CFR 16.33 and 16.241(b)-(f), respectively.
Section 16.3 currently defines ``Director'' to be the Director of
the Office of Airport Safety and Standards. The Director holds primary
responsibility for issuing decisions in response to Part 16 complaints.
In 2008, the FAA Administrator created the Office of Airport Compliance
and Field Operations, and reassigned responsibility for adjudication of
complaints filed against sponsors under Part 16 to that organization.
The goal of these changes was to allow the Office of Airport Safety and
Standards to provide greater emphasis on core safety and engineering
mission requirements.\13\ With added changes to the FAA Airports
organization in 2011, the Administrator assigned the compliance
function to the newly reorganized Office of Airport Compliance and
Management Analysis.\14\
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\13\ FAA Notice 1100.318, para. 4, April 29, 2008.
\14\ FAA Notice 1100.333, para. 5, May 6, 2011.
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Various stakeholders with experience filing or responding to Part
16 complaints have expressed opinions to the FAA on how to improve the
complaint adjudication process. To obtain initial input early in 2011
as the agency considered pursuing rulemaking, the FAA held ``listening
sessions'' with stakeholder organizations whose members have been most
affected by Part 16 proceedings. The FAA met with representatives from
the following associations:
Airports Council International-North America (ACI-NA),
whose member airport operators may be the subject of complaints and
therefore be required to respond under Part 16 (February 2011);
National Air Transportation Association (NATA), whose
member aviation service businesses such as fixed base operators (FBOs),
charter providers, and aircraft management companies are often involved
in Part 16 complaints (March 2011); and
Aircraft Owners and Pilots Association (AOPA), whose
member general aviation operators are also often involved in Part 16
complaints (April 2011).

The FAA has considered stakeholder recommendations as it has developed
proposed changes to Part 16, and looks forward to additional input from
public comments made in response to this proposed rule.
The intent of Part 16 was to expedite substantially the handling
and disposition of airport-related

[[Page 13030]]

complaints. The FAA's experience with the use of Part 16 has been
positive, in that the rule improved on the process available to
complainants under Part 13 before Part 16's implementation. While
decisions sometimes take longer than the basic time frames provided in
Part 16 for many reasons, there is no backlog of formal complaints
awaiting resolution.

C. Statement of the Problem

Part 16 has not been updated since its original implementation in
1996. As described earlier in this preamble, existing Part 16 processes
have worked well but are in need of revision based on agency and
stakeholder experience during the past 15 years. The FAA proposes
adding new processes and revising existing processes to clarify Part 16
and apply lessons learned to provide for more efficient use of agency
and stakeholder time and resources during complaint proceedings.

III. Discussion of the Proposal

A. Motions To Dismiss in Lieu of Answers and Loss of Standing by
Prevailing Complainant

1. Motions for Summary Judgment or Dismissal
Current Sec. 16.23(d) requires the respondent to file an answer to
any complaint not dismissed by the FAA under Sec. 16.25, within 20
days of the date of service of the FAA notification of docketing. Under
the present rule, it is not worthwhile for the respondent to move to
dismiss a complaint prior to preparing an answer because the submission
of a motion to dismiss does not suspend the 20-day time-limit for
filing an answer.\15\ The FAA has found that the respondent usually
begins the sometimes costly and time-consuming effort of drafting an
answer, complete with supporting documentation, at the same time as it
drafts the motion to dismiss. The practical result is that, as
suggested by current Sec. 16.23(j), the motion to dismiss and the
answer are almost always submitted at the same time. This practice is
inconsistent with that of other agencies and with the Federal Rules of
Civil Procedure.\16\ For example, 49 CFR 821.17 of the National
Transportation Safety Board's (NTSB) Rules of Practice in Air Safety
Proceedings, found at 49 CFR 821.1, et seq., provides an opportunity
for the NTSB to make a ruling through a summary judgment or grant a
motion to dismiss.\17\
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\15\ See Sec. 16.19(a).
\16\ Fed. R. Civ. P. 56.
\17\ See also National Highway Traffic Safety Administration's
Adjudicative Procedures at 49 CFR 511.25(d)-(e), and Federal Trade
Commission Rules of Practice for Adjudicative Proceedings at 16 CFR
3.24.
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In addition to lacking consistency with other agency rules, the FAA
believes that the current rule has required the full investigation
process for some complaints that clearly lacked sufficient legal basis.
The volume of complaints filed under Part 16 (231 through March 2011)
creates a significant workload for the agency and for respondents
alike.
Sponsor representatives in Part 16 actions have indicated to the
FAA that the full process under the current rule is burdensome in cases
where complaints may be considered frivolous. They have specifically
expressed concern about complaints they believe were filed merely to
harass, intimidate, or cause financial hardship to a respondent. These
stakeholders have suggested that a responsive motion could be used to
dispose of frivolous complaints.
The FAA recognizes that ``frivolous'' is in the eye of the
beholder. That said, it is not consistent with the intent of Part 16 or
good government to require full response and investigation of clearly
frivolous complaints. Although such complaints are clearly subject to
dismissal under Sec. Sec. 16.23, 16.25, and 16.27, the FAA recognizes
that there may be differences of opinion about their applicability.
Accordingly, the FAA believes it is appropriate to bring the Part 16
processes more in line with the Federal Rules of Civil Procedure \18\
and other agencies' practices and permit respondents' some recourse and
opportunity for ``self-help,'' consistent with adequate due process.
Therefore, the FAA is proposing a new Sec. 16.26, Motions to dismiss
and motions for summary judgment. These proposed rules could relieve
the respondent and the agency from completing a full investigative
process in certain cases by allowing the respondent to file a motion to
dismiss or a motion for summary judgment in lieu of preparing an
answer. Under proposed Sec. 16.26(e), the time-limits for filing an
answer would begin to run after the Director's decision regarding the
motion for dismissal or summary judgment. Under proposed Sec.
16.26(f), the time-limits for filing an answer would begin to run, in
cases where the Director does not act on the motion, within 30 days of
the date an answer to a motion is due under proposed Sec. 16.26. The
proposed change provides the FAA, the complainant, and the respondent
an opportunity to narrow the issues, and allows the FAA to conserve
resources by investigating only legitimate, non-frivolous grant
compliance issues.
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\18\ Fed. R. Civ. P. 56.
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Specifically, proposed Sec. 16.26(a) includes a process for
summary judgment whereby the respondent can request, and the FAA can
issue, a decision as a matter of law when there are no genuine issues
of material fact. Proposed Sec. 16.26(b) includes a process whereby
the respondent can file, and the FAA can grant or deny, a motion to
dismiss a complaint that fails to state a claim or where the claim is
legally inadequate because the facts do not support the claim. Proposed
new Sec. Sec. 16.26(c)-(g) provide more requirements in these cases.
2. Termination of Complainant Standing
The FAA believes that a complainant who has prevailed on all issues
at the Director's decision stage has received due process. Therefore,
the FAA is proposing to amend Sec. 16.109 so that a complainant may
not appeal a Director's Determination that has found a respondent in
noncompliance on all issues. Current Sec. 16.109 does not address the
continuing participation of a complainant when the Director finds a
sponsor in noncompliance on all issues identified in the initial
complaint. It is inconsistent with the process for a complainant to
appeal an action in which the complainant has prevailed. Such appeals
would produce unnecessary workload for the agency and respondents. When
a complainant prevails at the Director's Determination level, the
objectives of the Part 16 process have been met because the complainant
has identified sponsor noncompliance and the FAA has agreed through
issuance of a Director's Determination.
In the 1994 NPRM, the FAA proposed that the respondent and the
agency would be parties to the hearing and named in the hearing order.
The FAA received comments stating that the complainant should also be a
party to the hearing. The National Business Aviation Association (NBAA)
argued that ``the complainant's participation will help develop the
record of the case.'' \19\ As a result, the final rule allowed the
complainant to be a party to the hearing with the respondent and the
agency.\20\ In the preamble to the final rule, the FAA stated:
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\19\ 61 FR 53998-53999, October 16, 1996.
\20\ See 61 FR 53998-53999, October 16, 1996 and 14 CFR
16.203(b)(1).

[[Page 13031]]

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Under Sec. 16.31(d), a case proceeds to a hearing only after
the FAA has found against the respondent in an initial determination
that proposes the issuance of a compliance order. Thus, at the
hearing the FAA has the burden of proof to establish the validity of
its initial determination, including the proposed order of
compliance under Sec. 16.109. The respondent is a party to the
hearing who seeks reversal of the FAA's initial determination.
Although, a complainant's status as an airport user alone does not
give rise to a sufficient property interests to justify party status
as a matter of right, party status for the complainant will permit
it to have an opportunity to assist in the development of the
factual record as pointed out by NBAA. In addition, providing
automatic party status will avoid burdening the hearing officer and
parties with routine requests for intervention by complainant. The
rule provides the hearing officer with ample powers to control the
conduct of the hearing and to assure that complainant's
participation does not unduly delay the proceedings.\21\
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\21\ 61 FR 53998-53999, October 16, 1996.

Since the enactment of Part 16, there has been confusion about the
role of the complainant on appeal, given that at the hearing stage, the
FAA has identified the noncompliance and taken over the role of
complainant. The agency therefore becomes the prosecutor in a
proceeding before a hearing officer. The FAA has the burden of proof to
establish the validity of its initial determination, including the
proposed order of compliance. Therefore, the FAA is clarifying that the
role of the complainant at the hearing stage is limited to assisting,
as needed, in the development of the factual record.\22\
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\22\ See Centennial Express Airlines v. Arapahoe County Public
Airport Authority, FAA Docket No. 16-98-05, at 10 (Final Agency
Decision, February 18, 1999) (``the [Part 16] Rules of Practice give
Complainants party status only to assist the FAA in the development
of the factual record.'').
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B. Optional Electronic Filing Procedures

The existing Part 16 process does not include provisions for
electronic filing. Based on the success of an electronic filing test
program that the FAA started in 2010, the effective implementation of
such filing programs by other federal agencies, and the DOT's
implementation of an electronic Part 16 Docket through regulations.gov,
the FAA is proposing a new Sec. 16.13(h) to add an electronic filing
alternative for parties to use when filing pleadings as part of a Part
16 proceeding. In addition, the FAA is proposing new definitions for
``electronic filing'' and ``writing or written,'' and amended language
for the definition of ``mail'' in Sec. 16.3.
Use of electronic filing would be an alternative rather than a
requirement. In most cases, the electronic filing process would begin
at the complaint filing stage for the complainant and at the answer
stage for the respondent. The proposed rule would continue to require
the complainant to serve the respondent with the initial complaint by
personal delivery, facsimile, or mail unless the respondent has
previously agreed in writing to electronic filing. Any party that has
agreed to file electronically would be able to later opt out of the
electronic filing process. In these cases, the proposed rule would
require all other parties to then serve the party that has opted out by
personal delivery, facsimile, or mail. Finally, unless the FAA provides
specific notice that it will not accept electronic service, any party
could file pleadings electronically with the FAA docket clerk at any
stage of the Part 16 process except the hearing stage. At the hearing
stage, a hearing officer could direct the parties to serve pleadings by
another means.
The FAA expects that introducing the proposed electronic filing
option would save participating parties and the FAA both time and money
by foregoing the need to print documents on paper and then send them by
delivery or mail. The new electronic filing procedures would expedite
the process, reduce paper file storage requirements, and help in
document transmittal and routing. The FAA also expects to reduce
administrative costs because documents submitted electronically are
more easily placed in the FAA's electronic docket on regulations.gov.

C. Applicability of Part 16 Proceedings for Complaints Initiated Under
49 CFR Part 26

The present rule does not reference Disadvantaged Business
Enterprises' (DBEs) rights to file complaints under the Part 16
process. As described in section II.B of this preamble, the current
rule predates the 1999 implementation of 49 CFR part 26, Participation
by Disadvantaged Business Enterprises in DOT Financial Assistance
Programs.\23\ Present Part 16 does not describe how persons who are
eligible to file a complaint in accordance with 49 CFR 26.105(c) may do
so under Part 16, nor does it make clear that such a person does not
have to be directly and substantially affected by the alleged violation
to file a complaint.
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\23\ 64 FR 5126, February 2, 1999.
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To align with 49 CFR part 26, the FAA is proposing to change 14 CFR
part 16 by--
Revising the definition of Complaint in Sec. 16.3 to
include a document filed by a person under 49 CFR 26.105(c) against a
recipient of FAA funds alleged to have violated a provision of 49 CFR
parts 23 and/or 26.
Adding new Sec. Sec. 16.21(a) and (b) that would relieve
persons filing under 49 CFR 26.105(c) from the informal resolution
process required by this section.
Adding language in Sec. 16.23(a) to clarify the complaint
procedures for complainants filing under 49 CFR 26.105(c).
Adding language in Sec. 16.23(b)(4) to exclude a
complainant filing under 49 CFR 26.105(c) from the requirement to
describe how the respondent directly and substantially affected him or
her by ``things done or omitted to be done.''

D. Proposals To Streamline and Clarify Existing Processes

1. Intervention and Other Participation
Current Sec. 16.207 addresses third-party intervention and other
participation in Part 16 proceedings. This section has been generally
effective, but FAA experience has led the agency to identify several
updates that would improve the intervention process and reflect current
practices. First, the current rule does not limit third-party
participation to the hearing stage, nor does it restrict such
participation to the discretion of the hearing officer. The FAA
therefore proposes to add a new Sec. 16.207(a) to reflect this. This
addition would compel the redesignation of current paragraphs (a)
through (d) as newly redesignated paragraphs (b) through (e). The FAA
also proposes to recognize specifically the hearing officer's
discretion over participation at this stage by replacing ``FAA'' with
``hearing officer'' in current Sec. 16.207(d) (which the agency is
proposing to redesignate as Sec. 16.207(e)).
The FAA requires, in practice, any party that wishes to intervene
in Part 16 proceedings to do so with a written motion. To make this
practice transparent, the FAA is proposing to add the word ``written''
to the language in current Sec. 16.207(a), which it is proposing to
also redesignate as Sec. 16.207(b).
Currently, Sec. 16.207(b) states that a person may be granted
leave to intervene if that person has a property or financial interest
that may not be addressed adequately by the parties. The FAA believes
that, as written, parties may infer that the intervenor may use the
Part 16 process for monetary gains. This inference would be wrong. In
practice, neither an intervenor nor a complainant should expect
monetary gains, or, equitable or declaratory relief through the Part 16
process.

[[Page 13032]]

The FAA emphasizes that the Part 16 process is not a means of
providing compensation to complainants for damages incurred due to
alleged sponsor violations. The purpose of the Part 16 process, as
established in the 1996 rule, has been to address sponsor noncompliance
with federal obligations. Monetary relief, equitable relief, and
declaratory judgment have not been available to complainants as
remedies. Yet, some complainants have included in their complaints
specific requests for monetary or declaratory relief under the current
rule. Part 16 findings of noncompliance cannot and do not result in the
award of monetary damages.\24\ The FAA proposes to clarify this point
by amending language in current Sec. 16.207(b) to replace ``if the
person has a property or financial interest that may not be addressed
adequately by the parties'' with ``if the person has an interest that
will benefit the proceedings,'' as well as redesignating this paragraph
as Sec. 16.207(c).
---------------------------------------------------------------------------

\24\ See, e.g., Davis v. Jackson Municipal Airport, FAA Docket
No. 16-10-01, at 17 (Director's Determination January 18, 2011).
---------------------------------------------------------------------------

2. Corrective Action Plans
Presently, Part 16 identifies two remedies available for the FAA to
correct a noncompliant sponsor. First, Sec. 16.109 describes
procedures to terminate or prohibit federal grants, but does not
address corrective action. Second, current Sec. Sec. 16.241(c) and
(f)(3) provide for the Associate Administrator to make a statement of
corrective action, if appropriate, and identifies sanctions for
continued noncompliance. The FAA has found that corrective action can
be effective at the Director/initial decision level, but also could
benefit from clarified requirements. The FAA proposes to allow the
Director to have the same authority as the Associate Administrator to
require submission and completion of a Corrective Action Plan. These
changes would expedite the benefits of corrective action.
Proposed new Sec. Sec. 16.109(c) and 16.245(d)(1) specify that the
Director would be able to either enforce a Corrective Action Plan, or
begin proceedings to revoke or deny the respondent's application for
federal assistance. If a respondent fails to complete the Corrective
Action Plan requirement to the satisfaction of the FAA, proposed Sec.
16.109(d) would allow the FAA to begin proceedings to revoke or deny
the sponsor's application for federal assistance. Proposed Sec.
16.109(f) would give the process finality when a sponsor has fully
complied with a Corrective Action Plan and/or the sponsor has corrected
the areas of noncompliance by allowing the Director to terminate the
proceedings.
In addition, the FAA proposes to add language to Sec. 16.33 to
address an unusual situation concerning the interaction of a proposed
Corrective Action Plan and an appeal of a Director's Determination.
This situation occurs when the agency finds against the sponsor in its
initial determination and proceeds to work with the sponsor on the
Corrective Action Plan, but at the same time the sponsor appeals the
Director's Determination to the Associate Administrator for Airports.
It results in confusion when on the one hand, the agency is working
with the sponsor on correcting its behavior, and on the other hand, the
sponsor is challenging the legal basis for the Corrective Action Plan
and alleging error on the Director's part. To avoid this situation, the
FAA is proposing to hold any Corrective Action Plan in abeyance until
the appeal is resolved and/or a final order is issued.
3. Processes Involving the Director
The FAA has seen the need to clarify the role of the Director in
certain areas. Section 16.11 states, in part, that the Director will
conduct investigations, issue orders, and take such other actions as
are necessary to fulfill the purposes of this part. It goes on to
address the Director's authority to set time limits. The FAA has
experienced situations where a party has continued to file documents
with the Director after the issuance of a Director's Determination.
Most of these documents challenge the determination and some ask for
reconsideration. Some administrative processes used by other agencies
allow the official making an initial decision to retain jurisdiction of
a case and address the parties' concerns after rendering a
decision.\25\ However, it is the practice for the FAA to terminate the
initial stage with the issuance of the Director's Determination and
then to allow the Associate Administrator to consider any challenges to
the Director's Determination. Part 16 does not presently have a process
that specifically allows a party to ask for reconsideration of an
initial decision. Allowing the Associate Administrator to take up any
challenges to the Director's Determination starting at the issuance of
the Director's Determination would adequately address parties'
interests and uphold due process.
---------------------------------------------------------------------------

\25\ See, e.g., 49 CFR 821.1 et seq.
---------------------------------------------------------------------------

Therefore, proposed Sec. 16.11(c) provides that the Director's
jurisdiction terminates at the issuance of a Director's Determination,
except where the determination contains a Corrective Action Plan and
the sponsor does not appeal the determination.
The FAA is also proposing to change the section title to better
describe the contents of Sec. 16.11. The authority described in this
section is broader than that described by ``Expedition and other
modification of process,'' and would be better described by changing
this section heading to ``General processes.''
Additionally, the FAA finds it necessary to clarify whether or not
the Director may be petitioned for rehearing after issuing his or her
Director's Determination. The 1994 NPRM preamble indicates that the FAA
did not intend to make rehearings available to the parties immediately
after issuance of the Director's Determination. However, the 1996 Final
Rule makes no mention of rehearings at that stage in either the
regulatory text or the preamble, which dealt only with the availability
of appeals to the Associate Administrator.\26\ In order to increase
clarity and transparency, the FAA is proposing language in new Sec.
16.31(e) to preclude requests for ``rehearing, reargument,
reconsideration, or modification'' at this stage without a showing of
``good cause.''
---------------------------------------------------------------------------

\26\ 59 FR 29880, June 9, 1994, and 61 FR 53998, 54002, October
16, 1996.
---------------------------------------------------------------------------

Good cause is a ``substantial or legally sufficient reason for
doing something * * * `good cause' might include the existence of a
fraud, lack of notice to the parties or new evidence.'' \27\ It is a
strict standard under which rehearing, reargument or reconsideration is
not granted lightly.\28\ The FAA believes that full reconsideration
after the Director's Determination stage is unnecessary because of the
availability of an appeal to the Associate Administrator. This position
is consistent with the 1994 NPRM's intent to ``[p]rohibit interlocutory
appeals and requests for reconsideration, and focus instead on an
effective appeals process.'' \29\
---------------------------------------------------------------------------

\27\ Steven H. Gifis, Law Dictionary 91 (1975).
\28\ See Steven H. Gifis, Law Dictionary 91 (1975), see also
Black's Law Dictionary (9th ed. 2009).
\29\ 59 FR 29880, 29882, June 9, 1994.
---------------------------------------------------------------------------

4. Standard of Proof and Burden of Proof
The present rule addresses Standard of Proof and Burden of Proof
only as they relate to hearing officer actions, in Sec. Sec. 16.227
and 16.229 respectively. The present rule does not provide a Standard
of Proof and a Burden of Proof that the Director and Associate
Administrator must utilize. However, it has been the practice of the
Director and the Associate Administrator to use the

[[Page 13033]]

same Standard of Proof and Burden of Proof throughout all stages of
Part 16 proceedings, even though inconsistent treatment is permitted
under the current rules. This inconsistent treatment is neither the
intent nor the practice of the agency. In order to apply the same
requirements throughout all stages of Part 16 proceedings, the agency
proposes to add new Sec. 16.31(b) addressing Standard of Proof, and
new Sec. Sec. 16.23(k) and 16.33(e) addressing Burden of Proof.
5. Limitation of Issues for Consideration Upon Appeal
Currently, Sec. 16.33(d) does not prescribe any limitations for
the scope of the proceedings, and does not specifically prevent parties
from raising new issues at the review stage. Parties in past cases have
attempted to introduce new issues, offer additional evidence, and
expand the scope of the complaint at the appeal stage. Such practices
have delayed the issuance of Final Agency Decisions and have unfairly
required parties responding to an appeal to defend extraneous claims.
Other agencies limit the scope of an appeal, presumably for reasons
of economy and fairness.\30\ The FAA recognizes that such limits are
useful, and proposes to limit issues for consideration on appeal by
adding new sections addressing proceedings with and without hearings.
Therefore, under Sec. Sec. 16.33(e) and 16.245(e), if the Associate
Administrator sustains the Director or the hearing officer, the
Associate Administrator would limit review to whether or not--
---------------------------------------------------------------------------

\30\ Title 49 CFR part 821, NTSB Rules of Practice in Air Safety
Proceedings, include such limitations in Sec. 821.49, Issues on
appeal. Title 49 CFR part 1503, Transportation Security
Administration Investigative and Enforcement Proceedings, include
such limitations in Sec. 1503.657(b), Appeal from Initial Decision,
Issues on Appeal.
---------------------------------------------------------------------------

The findings of fact are each supported by a preponderance
of reliable, probative and substantial evidence contained in the
record;
The conclusions are made in accordance with law,
precedent, and policy;
The questions on appeal are substantial; and
Any prejudicial errors have occurred.

Further, under proposed Sec. Sec. 16.33(f) and 16.245(f), the
Associate Administrator would not consider additional issues or
evidence without a finding of good cause.
6. Provision for Consent Orders at the Non-Hearing Stage
Present Sec. 16.243 provides an opportunity for parties to settle
a case by entering into a consent order at the hearing stage of a
proceeding. In practice, parties have entered into consent orders with
the approval of the FAA at the non-hearing stage as well. This has
proven to be a viable way to settle cases. Therefore, the FAA proposes
to add a new Sec. 16.34 to explicitly provide for this practice. The
new process for the non-hearing stage in proposed Sec. 16.34 would be
consistent with the process in current Sec. 16.243 for the hearing
stage.
7. Limitations to the Deposition of FAA Employees
Current Sec. 16.215 addresses the general requirements for
depositions at the hearing stage of Part 16 proceedings. It does not
specifically consider the deposition of agency employees. The FAA
believes that this omission has provided an opportunity for parties to
acquire technical data from FAA employees to support their case, rather
than obtaining expert witness support. Proposed new Sec. 16.215(e)
would remove this opportunity. Specifically, new Sec. 16.215(e)(1)
would align Part 16 with the provisions of 49 CFR part 9, Testimony of
Employees of the Department and Production of Records in Legal
Proceedings. New Sec. 16.215(e)(2) would allow parties to depose
agency employees only with the specific written permission of the Chief
Counsel.
8. Processes Involving the Associate Administrator
The FAA believes that sections in current Part 16 pertaining to the
Associate Administrator's authority and review would benefit from
consolidation and clarification, especially with respect to the
authority of the Associate Administrator in ordering corrective action
after a finding of noncompliance. The FAA is proposing the following
changes:
Add new Sec. 16.33(f) clarifying the requirements for
submission of a petition to consider new evidence on appeal to the
Associate Administrator to show ``good cause.'' \31\
---------------------------------------------------------------------------

\31\ See Steven H. Gifis, Law Dictionary 91 (1975), see also
Black's Law Dictionary (9th ed. 2009).
---------------------------------------------------------------------------

Remove the Subpart G heading label ``Initial Decisions,
Orders and Appeals'' from before Sec. Sec. 16.241 through 16.243,
since these sections relate to the processes concerning hearings and
are therefore more fittingly included in Subpart F, Hearings.
Add a new Sec. 16.245, Associate Administrator Review
after a Hearing, to Subpart F, Hearings. New paragraphs would include:
[cir] Sec. 16.245(a), providing for permanent transfer of
authority in civil rights cases to the FAA Assistant Administrator for
Civil Rights (as described in section III.D.10 of this preamble);
[cir] Sec. 16.245(b), providing a more complete description of the
Administrator's Authority to change a hearing officer's initial
decision or remand it to the hearing officer if the Associate
Administrator finds that the hearing officer erred;
[cir] Sec. 16.245(c), describing the Associate Administrator's
authority after a hearing, as adopted from current Sec. 16.241(f) with
an increase of the time limit from 30 to 60 days for the Associate
Administrator to issue a Final Agency Decision (to reflect current
practice and resources);
[cir] Sec. 16.245(d), Orders of Compliance, explaining Associate
Administrator authority to impose a Corrective Action Plan when the FAA
finds a sponsor in violation (proposed Sec. 16.245(d)(1)), and to
remand the case to the Director for enforcement of the Corrective
Action Plan (proposed Sec. 16.245(d)(2)) (see also section III.D.2 of
this preamble);
[cir] Sec. Sec. 16.245(e) and (f), limiting issues that the
Associate Administrator will consider upon appeal (as described in
section III.D.5 of this preamble); and
[cir] Sec. 16.245(g), providing for appeal of Final Agency
Decisions issued by the Associate Administrator in accordance with
existing Subpart H, Judicial review (which the FAA proposes to
redesignate as Subpart G).
9. Transfer of Responsibility for Civil Rights Cases
As discussed at several points in this preamble, the present rule
predates the 1999 DOT amendment to 49 CFR parts 23 and 26 that provided
for DBE filing of complaints under 14 CFR part 16, and does not provide
specific direction for complaints involving civil rights issues. 49 CFR
part 26 is designed to help ensure that there is a level playing field
for socially and economically disadvantaged firms to compete for
airport contracting and concession opportunities.
Section III.C of this preamble specifically addresses the process
for complainants filing under 49 CFR parts 23 and 26. However, the FAA
also believes the new rule should reflect the agency practice of
transferring the investigation and adjudication of part 16 complaints
involving civil rights issues to the Office of Civil Rights. The FAA

[[Page 13034]]

recognizes that its Office of Civil Rights is best suited to issue
decisions in part 16 cases filed under 49 CFR parts 23 and 26.\32\ The
FAA would formalize the authority of the FAA Office of Airports to
transfer appropriate complaints, in whole or in part, to the Office of
Civil Rights by amending the definitions of Associate Administrator and
Director in current Sec. 16.3, and adding new Sec. Sec. 16.11(d),
16.33(a), and 16.245(a) to address the involvement of the Office of
Civil Rights throughout the proceedings.
---------------------------------------------------------------------------

\32\ See Albuquerque Valet Service, et al., v. City of
Albuquerque, FAA Docket No. 16-01-01, at 3 n. 2 (Director's
Determination February 11, 2002).
---------------------------------------------------------------------------

10. Availability of Judicial Review
Presently, Sec. 16.247(a) provides that a person may seek judicial
review of a final decision and order of the Associate Administrator.
Section 16.247(b) states the decisions and determinations that do not
constitute a final agency order. Although Sec. 16.25 states that
complaints may be dismissed with prejudice, in whole or in part for
three reasons, the regulatory text is silent about whether such partial
dismissals are interlocutory orders or are final orders subject to
immediate judicial review. The discussion of dismissals under Sec.
16.25 in the preamble to the 1996 Final Rule states:

[b]esides dismissal of complaints that clearly do not state a
cause of action, or those that do not come within the jurisdiction
of the Administrator, a complaint may also be dismissed if the
complainant lacks standing to file the complaint under Sec. Sec.
16.3 and 16.23. As a final order of the agency, a dismissal with
prejudice would be appealable to a United States Court of
Appeals.\33\
---------------------------------------------------------------------------

\33\ 61 FR 53998, 540001 October 16, 1996.

---------------------------------------------------------------------------
Similarly, the discussion in the preamble to the 1994 NPRM states:

[c]omplaints that clearly do not state a cause of action that
warrants investigation by the jurisdiction of the Administrator, as
well as those that do not come within the jurisdiction of the
Administrator under the authorities set forth in this part, would be
dismissed with prejudice, within 20 days after receipt of the
complaint. As a final order of the agency, a dismissal would be
appealable to a United States Court of Appeals.\34\
---------------------------------------------------------------------------

\34\ 59 FR 29,880-01, 29883, June 9, 1994.

An appeal to the Associate Administrator for Airports from an order of
dismissal in these circumstances is simply not provided for.
The FAA saves time and resources by permitting direct judicial
review of dismissals based upon the types of issues set forth in Sec.
16.25. The parties similarly save time and resources. Moreover, that
position is consistent with decisions of United States Courts of
Appeals, which have found that certain orders of administrative
agencies may be appealed when the claims involved in the order are
separable from others in the case at hand and important enough that a
decision from the courts, without full agency review, is desirable.\35\
---------------------------------------------------------------------------

\35\ Finnegan v. Director, Office of Workers' Compensation
Programs, 69 F.3d 1039, 1040 (9th Cir. 1996). See also Elkins v.
Gober, 229 F.3d 1369, 1373 (Fed. Cir. 2000). C.f. State of New York
v. United States, 568 F.2d 887, 893 (2d Cir. 1977).
---------------------------------------------------------------------------

At this time, the FAA reiterates, consistent with the reasoning in
the preamble of the current rule and the 1994 NPRM, the Director has
the discretion to issue partial as well as complete dismissals with
prejudice. The FAA proposes to amend Sec. 16.247(a) to clarify that
such orders of dismissal with prejudice under Sec. 16.25 are final
agency orders subject to judicial review.
11. Adjustment of Time Periods Specified for Service by Mail
Presently, Sec. 16.17(c) provides that 3 days shall be added to
the prescribed period after the service if the service of a document is
by mail. The FAA is proposing to extend this time period to 5 days in
the new rule to align it with requirements contained in the agency's
part 13 Rules of Practice found at 14 CFR 13.211(e).
12. Other Updates
The FAA proposes other minor updates to part 16 that include:
Replacing the term ``Director's determination'' with
``Director's Determination'' throughout the rule to reflect what has
become a term of art;
Replacing references to the FAA Office of Airport Safety
and Standards in the definition of ``Director'' (Sec. 16.3) with the
FAA Office of Airport Compliance and Management Analysis, to reflect
current FAA Office of Airport organization (as described in section
II.B of this preamble);
Adding reference to ``other Federal obligations'' to
Sec. Sec. 16.1(a)(3)-(5) to ensure that any special conditions, terms
or requirements incorporated in grant agreements are included within
the provisions of general applicability to initiate a part 16
proceeding;
Removing Sec. 16.301, Definitions, inserting the
definitions of ``decisional employee'' and ``ex parte communication''
currently in Sec. 16.301 to Sec. 16.3, Definitions, and redesignating
Sec. Sec. 16.303, 16.305, and 16.307 as Sec. Sec. 16.301, 16.303, and
16.305, respectively;
Adding citation for 49 U.S.C. 47133, Restriction on use of
revenues, which became effective in 1996 after the publication of
current part 16, to the part 16 List of Authorities and Sec.
16.1(a)(5) (it is technically necessary to include references to 49
U.S.C. Sec. 47133, Restriction on use of airport revenue, for
completeness even though it supplements and parallels 49 U.S.C.
47107(b));
Amending the filing address in Sec. 16.13 to reflect that
the docket clerk in part 16 proceedings is now located in AGC-600;
Adding clarifying instructions for filing motions (Sec.
16.19);
Adding Sec. 16.19(e) Extension by motion, requiring that
``[a] party shall file a written motion for extension of time no later
than 3 days before the document is due,'' to ensure clarity and
transparency to the process of granting extensions. The day is
described as a ``business-day'' to avoid the 3-day limit encompassing a
Saturday, Sunday, or legal holiday; and
Adding to Sec. 16.21(c) requirements that certifications
of a party's efforts to obtain informal resolution involve descriptions
of efforts that are ``relatively recent'' and ``demonstrated by
pertinent documentation.''
The FAA believes that these updates would align the rule with
current practice and terminology.

IV. Regulatory Notices and Analyses

Changes to Federal regulations must undergo several economic
analyses. First, Executive Order 12866 and Executive Order 13563 direct
that each Federal agency shall propose or adopt a regulation only upon
a reasoned determination that the benefits of the intended regulation
justify its costs. Second, the Regulatory Flexibility Act of 1980 (Pub.
L. 96-354) requires agencies to analyze the economic impact of
regulatory changes on small entities. Third, the Trade Agreements Act
(Pub. L. 96-39) prohibits agencies from setting standards that create
unnecessary obstacles to the foreign commerce of the United States. In
developing U.S. standards, the Trade Act requires agencies to consider
international standards and, where appropriate, that they be the basis
of U.S. standards. Fourth, the Unfunded Mandates Reform Act of 1995
(Pub. L. 104-4) requires agencies to prepare a written assessment of
the costs, benefits, and other effects of proposed or final rules that
include a Federal mandate likely to result in the expenditure by State,
local, or tribal governments, in the aggregate, or by the private
sector, of $100 million or more annually (adjusted for inflation with
base year of 1995). This portion of the preamble

[[Page 13035]]

summarizes the FAA's analysis of the economic impacts of this proposed
rule.

A. Regulatory Evaluation

Department of Transportation Order DOT 2100.5 prescribes policies
and procedures for simplification, analysis, and review of regulations.
If the expected cost impact is so minimal that a proposed or final rule
does not warrant a full evaluation, this order permits that a statement
to that effect and the basis for it be included in the preamble if a
full regulatory evaluation of the cost and benefits is not prepared.
Such a determination has been made for this proposed rule.
The reasoning for this determination follows: The FAA's Office of
Airport Compliance and Management Analysis handles complaints made
against federally-assisted airports. Part 16 provides a process for
investigating and adjudicating complaints against airport operators for
violation of federal obligations. This proposed rule clarifies and
improves the efficiency of the current part 16 regulations for
adjudicating complaints on matters within the agency's authority. These
changes would be cost beneficial as they decrease time spent and volume
of paper documents required to process part 16 complaints. Resource
savings would be produced by allowing parties and the government to use
the new electronic filing process and allow a respondent to file a
motion to dismiss or a motion for summary judgment in lieu of an
answer. Once the complainant has prevailed at the Director's
Determination, no further positive outcome can be obtained through FAA
action. At this point there is no further purpose to be served by the
complainant and further appeals (and participation) are not productive.
The expected outcome will be a minimal impact with positive net
benefits, and a regulatory evaluation was not prepared. The FAA
requests comments regarding this determination.
FAA has, therefore, determined that this proposed rule is not a
``significant regulatory action'' as defined in section 3(f) of
Executive Order 12866, and is not ``significant'' as defined in DOT's
Regulatory Policies and Procedures.

B. Regulatory Flexibility Determination

The Regulatory Flexibility Act of 1980 (Pub. L. 96-354) (RFA)
establishes ``as a principle of regulatory issuance that agencies shall
endeavor, consistent with the objectives of the rule and of applicable
statutes, to fit regulatory and informational requirements to the scale
of the businesses, organizations, and governmental jurisdictions
subject to regulation. To achieve this principle, agencies are required
to solicit and consider flexible regulatory proposals and to explain
the rationale for their actions to assure that such proposals are given
serious consideration.'' The RFA covers a wide-range of small entities,
including small businesses, not-for-profit organizations, and small
governmental jurisdictions.
Agencies must perform a review to determine whether a rule will
have a significant economic impact on a substantial number of small
entities. If the agency determines that it will, the agency must
prepare a regulatory flexibility analysis as described in the RFA.
However, if an agency determines that a rule is not expected to have a
significant economic impact on a substantial number of small entities,
section 605(b) of the RFA provides that the head of the agency may so
certify and a regulatory flexibility analysis is not required. The
certification must include a statement providing the factual basis for
this determination, and the reasoning should be clear.
As noted above, the proposed changes to part 16 are cost relieving.
Accordingly, the proposed rule would not have a significant impact on a
substantial number of small entities. Therefore, the FAA certifies that
this proposed rule would not have a significant economic impact on a
substantial number of small entities. The FAA requests comments
regarding this determination. Specifically, the FAA requests comments
on whether the proposed rule creates any specific compliance costs
unique to small entities. Please provide detailed economic analysis to
support any cost claims.

C. International Trade Impact Assessment

The Trade Agreements Act of 1979 (Pub. L. 96-39), as amended by the
Uruguay Round Agreements Act (Pub. L. 103-465), prohibits Federal
agencies from establishing standards or engaging in related activities
that create unnecessary obstacles to the foreign commerce of the United
States. Pursuant to these Acts, the establishment of standards is not
considered an unnecessary obstacle to the foreign commerce of the
United States, so long as the standard has a legitimate domestic
objective, such as the protection of safety, and does not operate in a
manner that excludes imports that meet this objective. The statute also
requires consideration of international standards and, where
appropriate, that they be the basis for U.S. standards. The FAA has
assessed the potential effect of this proposed rule and determined that
it would have only a domestic impact and therefore create no obstacles
to the foreign commerce of the United States.

D. Unfunded Mandates Assessment

Title II of the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-
4) requires each Federal agency to prepare a written statement
assessing the effects of any Federal mandate in a proposed or final
agency rule that may result in an expenditure of $100 million or more
(in 1995 dollars) in any one year by State, local, and tribal
governments, in the aggregate, or by the private sector; such a mandate
is deemed to be a ``significant regulatory action.'' The FAA currently
uses an inflation-adjusted value of $143.1 million in lieu of $100
million. This proposed rule does not contain such a mandate; therefore,
the requirements of Title II of the Act do not apply.

E. Paperwork Reduction Act

The Paperwork Reduction Act of 1995 (44 U.S.C. 3507(d)) requires
that the FAA consider the impact of paperwork and other information
collection burdens imposed on the public. The FAA has determined that
there would be no new requirement for information collection associated
with this proposed rule.

F. International Compatibility

In keeping with U.S. obligations under the Convention on
International Civil Aviation, it is FAA policy to conform to
International Civil Aviation Organization (ICAO) Standards and
Recommended Practices to the maximum extent practicable. The FAA has
determined that there are no ICAO Standards and Recommended Practices
that correspond to these proposed regulations.

G. Environmental Analysis

FAA Order 1050.1E, Policies and Procedures for Considering
Environmental Impacts, identifies FAA actions that are categorically
excluded from preparation of an environmental assessment or
environmental impact statement under the National Environmental Policy
Act in the absence of extraordinary circumstances. The FAA has
determined this rulemaking action qualifies for the categorical
exclusion identified in paragraph 312d and involves no extraordinary
circumstances.

[[Page 13036]]

V. Executive Order Determinations

A. Executive Order 13132, Federalism

The FAA has analyzed this proposed rule under the principles and
criteria of Executive Order 13132, Federalism. The agency has
determined that this action would not have a substantial direct effect
on the States, or the relationship between the Federal Government and
the States, or on the distribution of power and responsibilities among
the various levels of government, and, therefore, would not have
Federalism implications.

B. Executive Order 13211, Regulations That Significantly Affect Energy
Supply, Distribution, or Use

The FAA analyzed this proposed rule under Executive Order 13211,
Actions Concerning Regulations that Significantly Affect Energy Supply,
Distribution, or Use (May 18, 2001). The agency has determined that it
would not be a ``significant energy action'' under the executive order
and would not be likely to have a significant adverse effect on the
supply, distribution, or use of energy.

VI. Additional Information

A. Comments Invited

The FAA invites interested persons to participate in this
rulemaking by submitting written comments, data, or views. The agency
also invites comments relating to the economic, environmental, energy,
or federalism impacts that might result from adopting the proposals in
this document. The most helpful comments reference a specific portion
of the proposal, explain the reason for any recommended change, and
include supporting data. To ensure the docket does not contain
duplicate comments, commenters should send only one copy of written
comments, or if comments are filed electronically, commenters should
submit only one time.
The FAA will file in the docket all comments it receives, as well
as a report summarizing each substantive public contact with FAA
personnel concerning this proposed rulemaking. Before acting on this
proposal, the FAA will consider all comments it receives on or before
the closing date for comments. The FAA will consider comments filed
after the comment period has closed if it is possible to do so without
incurring expense or delay. The agency may change this proposal in
light of the comments it receives.

B. Availability of Rulemaking Documents

An electronic copy of rulemaking documents may be obtained from the
Internet by--
1. Searching the Federal eRulemaking Portal (http://www.regulations.gov);
2. Visiting the FAA's Regulations and Policies Web page at http://www.faa.gov/regulations_policies or
3. Accessing the Government Printing Office's Web page at http://www.gpoaccess.gov/fr/index.html.
Copies may also be obtained by sending a request to the Federal
Aviation Administration, Office of Rulemaking, ARM-1, 800 Independence
Avenue SW., Washington, DC 20591, or by calling (202) 267-9680.
Commenters must identify the docket or notice number of this
rulemaking.
All documents the FAA considered in developing this proposed rule,
including economic analyses and technical reports, may be accessed from
the Internet through the Federal eRulemaking Portal referenced in item
(1) above.

List of Subjects in 14 CFR Part 16

Administrative practice and procedure, Airports, Investigations.

The Proposed Amendment

In consideration of the foregoing, the Federal Aviation
Administration proposes to amend chapter I of title 14, Code of Federal
Regulations as follows:

PART 16--RULES OF PRACTICE FOR FEDERALLY-ASSISTED AIRPORT
ENFORCEMENT PROCEEDINGS

1. The authority citation for part 16 is revised to read as
follows:

Authority: 49 U.S.C. 106(g), 322, 1110, 1111, 1115, 1116, 1718
(a) and (b), 1719, 1723, 1726, 1727, 40103(e), 40113, 40116,
44502(b), 46101, 46104, 46110, 47104, 47106(e), 47107, 47108,
47111(d), 47122, 47123-47125, 47133, 47151-47153, 48103.

2. Amend Sec. 16.1 by revising paragraphs (a) introductory text
and (a)(3) through (6) to read as follows:

Sec. 16.1 Applicability and description of part.

(a) General. The provisions of this part govern all Federal
Aviation Administration (FAA) proceedings involving Federally-assisted
airports, except for complaints or requests for determination filed
with the Secretary under 14 CFR part 302, whether the proceedings are
instituted by order of the FAA or by filing a complaint with the FAA
under the following authorities:
* * * * *
(3) The assurances and other Federal obligations contained in
grant-in-aid agreements issued under the Federal Airport Act of 1946,
49 U.S.C. 1101 et seq. (repealed 1970).
(4) The assurances and other Federal obligations contained in
grant-in-aid agreements issued under the Airport and Airway Development
Act of 1970, as amended, 49 U.S.C. 1701 et seq.
(5) The assurances and other Federal obligations contained in
grant-in-aid agreements issued under the Airport and Airway Improvement
Act of 1982 (AAIA), as amended, 49 U.S.C. 47101 et seq., specifically
section 511(a), 49 U.S.C. 47107, and 49 U.S.C. 47133.
(6) Section 505(d) of the Airport and Airway Improvement Act of
1982, and the requirements concerning civil rights and/or Disadvantaged
Business Enterprise (DBE) issues contained in 49 U.S.C. 47107(e) and 49
U.S.C. 47113; 49 U.S.C. 47123; 49 U.S.C. 322, as amended; 49 CFR parts
23 and/or 26; and/or grant assurance 30 and/or grant assurance 37.
* * * * *
3. Amend Sec. 16.3 as follows:
a. Remove the definitions of Director's determination, File, and
Final decision and order;
b. Revise the definitions of Agency employee, Associate
Administrator, Complaint, Director, Hearing officer, Mail, and Personal
delivery; and
c. Add definitions for Administrator, Agency, Decisional employee,
Electronic filing, Ex parte communication, and Writing or written.
The revisions and additions read as follows:

Sec. 16.3 Definitions.

* * * * *
Administrator means the Administrator of the FAA;
Agency means the FAA.
* * * * *
Agency employee means any employee of the FAA.
Associate Administrator means the FAA Associate Administrator for
Airports or a designee. For the purposes of this part only, Associate
Administrator also means the Assistant Administrator for Civil Rights
or a designee for complaints that the FAA Associate Administrator for
Airports transfers to the Assistant Administrator for Civil Rights.
* * * * *
Complaint means a written document meeting the requirements of this
part and filed under this part:
(1) By a person directly and substantially affected by anything
allegedly done or omitted to be done by

[[Page 13037]]

any person in contravention of any provision of any Act, as defined in
this section, as to matters within the jurisdiction of the
Administrator, or
(2) By a person under 49 CFR 26.105(c) against a recipient of FAA
funds alleged to have violated a provision of 49 CFR parts 23 and/or
26.
Decisional employee means the Administrator, Deputy Administrator,
Associate Administrator, Director, hearing officer, or other FAA
employee who is or who may reasonably be expected to be involved in the
decisional process of the proceeding.
Director means the Director of the FAA Office of Airport Compliance
and Management Analysis, or a designee. For the purposes of this part
only, Director also means the Deputy Assistant Administrator for Civil
Rights for complaints that the Director of the FAA Office of Airport
Compliance and Management Analysis transfers to the Deputy Assistant
Administrator for Civil Rights or designee.
Electronic filing means the process of sending electronic mail
(email) to the FAA Part 16 Docket Clerk, with scanned documents
attached, as a Portable Document Format (PDF) file.
Ex parte communication means an oral or written communication not
on the public record with respect to which reasonable prior notice to
all parties is not given, but it shall not include requests for status
reports on any matter or proceeding covered by this part, or
communications between FAA employees who participate as parties to a
hearing pursuant to 16.203(b) of this part and other parties to a
hearing.
Hearing officer means an attorney designated by the Deputy Chief
Counsel in a hearing order to serve as a hearing officer in a hearing
under this part. The following are not designated as hearing officers:
the Chief Counsel and Deputy Chief Counsel; the Regional or Center
Counsel and attorneys in the FAA region or center in which the
noncompliance has allegedly occurred or is occurring; the Assistant
Chief Counsel and attorneys in the Airport Law Branch of the FAA Office
of the Chief Counsel; and the Assistant Chief Counsel and attorneys in
the Litigation Division of the FAA Office of Chief Counsel.
* * * * *
Mail means U.S. first class mail; U.S. certified mail; and U.S.
express mail. Unless otherwise noted, mail also means electronic mail
containing PDF copies of pleadings or documents required herein.
* * * * *
Personal delivery means same-day hand delivery or overnight express
delivery service.
* * * * *
Writing or written includes paper documents that are filed and/or
served by mail, personal delivery, facsimile, or email (as attached PDF
files).
4. Amend Sec. 16.11 by revising the section heading and paragraphs
(a) and (b) introductory text, and adding paragraphs (c) and (d) to
read as follows:

Sec. 16.11 General processes.

(a) Under the authority of 49 U.S.C. 40113 and 47121, the Director
may conduct investigations, issue orders, and take such other actions
as are necessary to fulfill the purposes of this part. This includes
the extension of any time period prescribed, where necessary or
appropriate for a fair and complete consideration of matters before the
agency, prior to issuance of the Director's Determination.
(b) Notwithstanding any other provision of this part, upon finding
that circumstances require expedited handling of a particular case or
controversy, the Director may issue an order directing any of the
following prior to the issuance of the Director's Determination:
* * * * *
(c) Other than those matters concerning a Corrective Action Plan,
the jurisdiction of the Director terminates upon the issuance of the
Director's Determination. All matters arising during the appeal period,
such as requests for extension of time to make an appeal, will be
addressed by the Associate Administrator.
(d) The Director may transfer to the FAA Deputy Assistant
Administrator for Civil Rights or Office of Civil Rights designee the
authority to prepare and issue Director's Determinations pursuant to
Sec. 16.31 for complaints alleging violations of Section 505(d) of the
Airport and Airway Improvement Act of 1982, and the requirements
concerning civil rights and/or Disadvantaged Business Enterprise (DBE)
issues contained in 49 U.S.C. 47107(e) and 49 U.S.C. 47113; 49 U.S.C.
47123; 49 U.S.C. 322, as amended; 49 CFR parts 23 and/or 26; and/or
grant assurance 30 and/or grant assurance 37.
5. Amend Sec. 16.13 by revising paragraphs (a), (b), (c), (d), and
(f) and adding paragraphs (h) and (i) to read as follows:

Sec. 16.13 Filing of documents.

* * * * *
(a) Filing address. Documents filed under this Part shall be filed
with the Office of the Chief Counsel, Attention: FAA Part 16 Docket
Clerk, AGC-600, Federal Aviation Administration, 800 Independence Ave.,
SW., Washington, DC 20591. Documents to be filed with a hearing officer
shall be filed at the address and in the manner stated in the hearing
order.
(b) Date and method of filing. Filing of any document shall be by
personal delivery or mail as defined in this part, by facsimile (when
confirmed by filing on the same date by one of the foregoing methods),
or electronically as set forth in paragraph (h) of this section. Unless
the date is shown to be inaccurate, documents filed with the FAA shall
be deemed to be filed on the date of personal delivery, on the mailing
date shown on the certificate of service, on the date shown on the
postmark if there is no certificate of service, on the send date shown
on the facsimile (provided filing has been confirmed through one of the
foregoing methods), or on the mailing date shown by other evidence if
there is no certificate of service and no postmark. Unless the date is
shown to be inaccurate, documents filed electronically shall be deemed
to be filed on the date shown on the certificate of service or, if
none, the date of electronic transmission to the last party required to
be served.
(c) Number of copies. With the exception of electronic filing or
unless otherwise specified, an executed original and three copies of
each document shall be filed with the FAA Part 16 Docket Clerk. One of
the three copies shall not be stapled, bound or hole-punched. Copies
need not be signed, but the name of the person signing the original
shall be shown. If a hearing order has been issued in the case, one of
the three copies shall be filed with the hearing officer unless
otherwise prescribed by the hearing officer. A facsimile neither
constitutes an executed original nor one of the three copies required
directly above.
(d) Form. Documents filed under this part shall:
(1) Be typewritten or legibly printed;
(2) Include, in the case of docketed proceedings, the docket number
of the proceeding on the front page; and
(3) Be marked to identify personal, privileged or proprietary
information. Decisions for the publication and release of these
documents will be made in accordance with 5 U.S.C. 552 and 49 CFR part
7.
* * * * *
(f) Designation of person to receive service. The initial document
filed by any person shall state on the first page the name, post office
address, telephone number, facsimile number, if any, and

[[Page 13038]]

email address, if filing electronically, of the person(s) to be served
with documents in the proceeding. If any of these items change during
the proceeding, the person shall promptly file notice of the change
with the FAA Part 16 Docket Clerk and the hearing officer and shall
serve the notice on all parties.
* * * * *
(h) Electronic filing. (1) The initial complaint may be served
electronically upon the respondent only if the respondent has
previously agreed with the complainant in writing to participate in
electronic filing. Documents may be filed under this Part
electronically by sending an email containing (an) attachment(s) of (a)
PDF file(s) of the required pleading to the FAA Docket Clerk, and the
person designated in paragraph (h)(3) of this section.
(2) The subject line of the email must contain the names of the
complainant and respondent, and must contain the FAA docket number (if
assigned). The size of each email must be less than 10 MB. Email
attachments containing executable files (e.g., .exe and .vbs files)
will not be accepted.
(3) The email address at which the parties may file the documents
described in this section is 9-AWA-AGC-Part-16@faa.gov. No
acknowledgement or receipt will be provided by the FAA to parties using
this method. A party filing electronically as described in this section
must provide to the FAA Part 16 Docket Clerk and the opposing party an
email address of the person designated by the party to receive
pleadings.
(4) By filing a pleading or document electronically as described in
this section, a party waives the rights under this part for service by
the opposing party and the FAA by methods other than email. If a party
subsequently decides to ``opt-out'' of electronic filing, that party
must so notify the FAA Part 16 Docket Clerk and the other party in
writing, from which time the FAA and the parties will begin serving the
opting-out party in accordance with Sec. Sec. 16.13 and 16.15. This
subsection only exempts the parties from the filing and service
requirements in Sec. 16.13(a) (with the exception that ``Documents to
be filed with a hearing officer shall be filed at the address stated in
the hearing order.''), the method of filing requirements in Sec.
16.13(b), and the number of documents requirements in Sec. 16.13(c).
(i) Internet accessibility of documents filed in the Hearing
Docket. (1) Unless protected from public disclosure, all documents
filed in the Hearing Docket are accessible through the Federal Docket
Management System (FDMS): http://www.regulations.gov. To access a
particular case file, use the FDMS number assigned to the case.
(2) Determinations issued by the Director and Associate
Administrator in Part 16 cases, indexes of decisions, contact
information for the FAA Hearing Docket, the rules of practice, and
other information are available on the FAA Office of Airport's Web site
at: http://part16.airports.faa.gov/index.cfm.
6. Amend Sec. 16.15 by revising paragraphs (a), (b), (d)(1) and
(d)(2), and adding paragraph (d)(3) to read as follows:

Sec. 16.15 Service of documents on the parties and the agency.

* * * * *
(a) Who must be served. Copies of all documents filed with the FAA
Part 16 Docket Clerk shall be served by the persons filing them on all
parties to the proceeding. A certificate of service shall accompany all
documents when they are tendered for filing and shall certify
concurrent service on the FAA and all parties. Certificates of service
shall be in substantially the following form:

I hereby certify that I have this day served the foregoing [name of
document] on the following persons at the following addresses,
facsimile numbers (if also served by facsimile), or email address
(if served electronically in accordance with Sec. 16.13(h)), by
[specify method of service]:

[list persons, addresses, facsimile numbers, email addresses (as
applicable)]

Dated this ---- day of ----, 20----.

[signature], for [party]

(b) Method of service. Except as otherwise agreed by the parties
and, if applicable, the hearing officer, the method of service is the
same as set forth in Sec. 16.13(b) for filing documents.
* * * * *
(d) * * *
(1) When acknowledgment of receipt is by a person who customarily
or in the ordinary course of business receives mail at the address of
the party or of the person designated under Sec. 16.13(f);
(2) When a properly addressed envelope, sent to the most current
address submitted under Sec. 16.13(f), has been returned as
undeliverable, unclaimed, or refused; or
(3) When the party serving the document electronically has a
confirmation statement demonstrating that the email was properly sent
to a party correctly addressed.
* * * * *
7. Amend Sec. 16.17 by revising paragraph (c) to read as follows:

Sec. 16.17 Computation of time.

* * * * *
(c) Whenever a party has the right or is required to do some act
within a prescribed period after service of a document upon the party,
and the document is served on the party by first class mail or
certified mail, 5 days shall be added to the prescribed period.
8. Amend Sec. 16.19 by adding paragraphs (d) and (e) to read as
follows:

Sec. 16.19 Motions.

* * * * *
(d) Deferred actions on motions. A ruling on a motion made before
the time set for the issuance of the Director's Determination may be
deferred to and included with the Director's Determination.
(e) Extension by motion. A party shall file a written motion for an
extension of time not later than 3 business days before the document is
due unless good cause for the late filing is shown. A party filing a
motion for extension should attempt to obtain the concurrence of the
opposing party. A party filing a written motion for an extension of
time shall file the motion as required under Sec. 16.13, and serve a
copy of the motion on all parties and the docket clerk as required
under Sec. 16.15.
9. Revise Sec. 16.21 to read as follows:

Sec. 16.21 Pre-complaint resolution.

(a) Except for those persons filing under 49 CFR 26.105(c), prior
to filing a complaint under this part, a person directly and
substantially affected by the alleged noncompliance shall initiate and
engage in good faith efforts to resolve the disputed matter informally
with those individuals or entities believed responsible for the
noncompliance. These efforts at informal resolution may include,
without limitation, at the parties' expense, mediation, arbitration, or
the use of a dispute resolution board, or other form of third party
assistance. The FAA Airports District Office, FAA Airports Field
Office, FAA Regional Airports Division responsible for administering
financial assistance to the sponsor, or the FAA Office of Civil Rights
will be available upon request to assist the parties with informal
resolution.
(b) Except for complaints filed under 49 CFR 26.105(c), a complaint
will be dismissed under Sec. 16.27 unless the person or authorized
representative filing the complaint certifies that:
(1) The complainant has made substantial and reasonable good faith
efforts to resolve the disputed matter informally prior to filing the
complaint; and

[[Page 13039]]

(2) There is no reasonable prospect for practical and timely
resolution of the dispute.
(c) The certification required under paragraph (b) of this section,
shall include a brief description of the party's efforts to obtain
informal resolution but shall not include information on monetary or
other settlement offers made but not agreed upon in writing by all
parties. Such efforts to resolve informally should be relatively recent
and be demonstrated by pertinent documentation. There is no required
form or process for informal resolution, but in each case the
requirements to resolve the matter informally must meet the
requirements of this paragraph.
10. Amend Sec. 16.23 by revising the section heading; revising
paragraphs (a), (b)(2), (b)(4), (c), (d), and (j); and adding
paragraphs (k) and (l) to read as follows:

Sec. 16.23 Pleadings.

(a) A person directly and substantially affected by any alleged
noncompliance or a person qualified under 49 CFR 26.105(c) may file a
complaint under this Part. A person doing business with an airport and
paying fees or rentals to the airport shall be considered directly and
substantially affected by alleged revenue diversion as defined in 49
U.S.C. 47107(b).
(b) * * *
(2) Include all documents then available in the exercise of
reasonable diligence, to be offered in support of the complaint, and to
be served upon all persons named in the complaint as persons
responsible for the alleged action(s) or omission(s) upon which the
complaint is based;
* * * * *
(4) Except for complaints filed under 49 CFR 26.105(c), describe
how the complainant was directly and substantially affected by the
things done or omitted to be done by the respondents.
(c) Unless the complaint is dismissed pursuant to Sec. 16.25 or
Sec. 16.27, the FAA notifies the complainant and respondent in writing
within 20 days after the date the FAA receives the complaint that the
complaint has been docketed.
(d) The respondent shall file an answer within 20 days of the date
of service of the FAA notification or, if a motion is filed under Sec.
16.26, within 20 days of the date of service of an FAA order denying
all or part of that motion.
* * * * *
(j) Amendments or supplements to the pleadings described in this
section will not be allowed without showing good cause through a motion
and supporting documents.
(k) Burden of Proof. Except as used in subpart F of this part,
(1) The burden of proof is on the complainant to show noncompliance
with an Act or any regulation, order, agreement or document of
conveyance issued under the authority of an Act.
(2) Except as otherwise provided by statute or rule, the proponent
of a motion, request, or order has the burden of proof.
(3) A party who has asserted an affirmative defense has the burden
of proving the affirmative defense.
(l) Except for good cause shown through motion and supporting
documents, discovery is not permitted except as provided in Sec. Sec.
16.213 and 16.215.
11. Revise Sec. 16.25 to read as follows:

Sec. 16.25 Dismissals.

(a) Within 20 days after the receipt of the complaint, unless a
motion has been filed under Sec. 16.26, the Director will dismiss a
complaint, or any claim made in a complaint, with prejudice if:
(1) It appears on its face to be outside the jurisdiction of the
Administrator under the Acts listed in Sec. 16.1;
(2) On its face it does not state a claim that warrants an
investigation or further action by the FAA; or
(3) The complainant lacks standing to file a complaint under
Sec. Sec. 16.3 and 16.23.
(b) A dismissal under this section will include the reasons for the
dismissal.
12. Add Sec. 16.26 as follows:

Sec. 16.26 Motions to dismiss and motions for summary judgment.

(a) In lieu of an answer, the respondent may file a motion to
dismiss the complaint or a motion for summary judgment on the
complaint. The respondent may move for dismissal of the entire
complaint or move for dismissal of particular issues from adjudication.
The motion must be filed within 20 days after the date the FAA receives
the complaint.
(b) A motion to dismiss or a motion for summary judgment may be
based on the grounds that there is no genuine issue of material fact
for adjudication and that the complaint, when viewed in the light most
favorable to the complainant, should be dismissed as a matter of law
because it:
(1) Fails to state a claim that the respondent has violated any
obligation subject to adjudication under this part;
(2) Fails to state a claim within the jurisdiction of the FAA; or
(3) Fails to meet the requirements for filing a complaint under
this part.
(c) A motion to dismiss or a motion for summary judgment shall be
accompanied by a concise statement of the material facts as to which
the respondent contends there is no genuine issue of material fact. The
motion may include affidavits and documentary evidence in support of
the contention that there is no genuine issue of fact in dispute.
(d) A complainant may file an answer to the motion within 10 days
of the date the motion is served on the complainant, or within any
other period set by the Director. The answer shall be accompanied by a
concise statement of the material facts the complainant contends are
and are not in dispute, and may be accompanied by affidavits and other
documentary evidence in support of that contention.
(e) Within 30 days of the date an answer to a motion is due under
this section, the Director may issue an order granting the motion, in
whole or in part. If the Director denies the motion in whole or in
part, then within 20 days of when the order is served on the
respondent, the respondent shall file an answer to the complaint.
(f) If the Director does not act on the motion within 30 days of
the date an answer to a motion is due under this section, the
respondent shall file an answer to the complaint within the next 20
days.
13. Revise Sec. 16.27 to read as follows:

Sec. 16.27 Incomplete complaints.

(a) If a complaint is not dismissed pursuant to Sec. 16.25 of this
part, but is deficient as to one or more of the requirements set forth
in Sec. 16.21 or Sec. 16.23(b), the Director will dismiss the
complaint within 20 days after receiving it. Dismissal will be without
prejudice to the refiling of the complaint after amendment to correct
the deficiency. The Director's dismissal will include the reasons for
the dismissal.
(b) Dismissals under this section are not initial determinations,
and appeals from decisions under this section will not be permitted.
14. In Sec. 16.29, revise the first sentence of paragraph (b)(2)
to read as follows:

Sec. 16.29 Investigations.

* * * * *
(b) * * *
(2) Obtaining additional oral and documentary evidence by use of
the agency's authority to compel production of such evidence under
section 313 of the Federal Aviation Act of 1958 as amended by 49 U.S.C.
40113 and 46104, and section 519 of the Airport and Airway Improvement
Act, 49 U.S.C. 47122. * * *
* * * * *
15. Revise Sec. 16.31 to read as follows:

[[Page 13040]]

Sec. 16.31 Director's Determinations after investigations.

(a) After consideration of the pleadings and other information
obtained by the FAA after investigation, the Director will render an
initial determination and serve it upon each party within 120 days of
the date the last pleading specified in Sec. 16.23 was due.
(b)(1) The Director's Determination shall include findings of fact
and conclusions of law, accompanied by explanations and based upon all
material issues of fact, credibility of the evidence, law and
discretion presented on the record, together with a statement of the
reasons therefor.
(2) The Director shall issue a determination or rule in a party's
favor only if the determination or ruling is in accordance with law and
supported by a preponderance of the reliable, probative, and
substantial evidence contained in the record.
(c) A party adversely affected by the Director's Determination may
appeal the initial determination as provided in Sec. 16.33. However,
if the Director's Determination that is appealed contains a Corrective
Action Plan, the Director has the discretion to suspend the Corrective
Action Plan until the appeal is resolved.
(d) If the Director's Determination finds the respondent in
noncompliance and proposes the issuance of a compliance order, the
initial determination will include notice of opportunity for a hearing
under subpart F of this part if a hearing is required by statute or
otherwise provided by the FAA. A hearing may be required by statute if
the FAA determination would terminate eligibility for grants under 49
U.S.C. 47114(c) or (e), or terminate payments on a grant agreement
under 49 U.S.C. subchapter 471. The respondent may elect or waive a
hearing, as provided in subpart E of this part.
(e) The Director will not consider requests for rehearing,
reargument, reconsideration, or modification of a Director's
Determination without a finding of good cause.
16. Revise Sec. 16.33 to read as follows:

Sec. 16.33 Final decisions without hearing.

(a) The Associate Administrator may transfer to the FAA Assistant
Administrator for Civil Rights the responsibility to prepare and issue
Final Agency Decisions pursuant to this section for appeals with issues
concerning civil rights.
(b) The Associate Administrator will issue a final decision on
appeal from the Director's Determination, without a hearing, where--
(1) The complaint is dismissed after investigation;
(2) A hearing is not required by statute and is not otherwise made
available by the FAA; or
(3) The FAA provides opportunity for a hearing to the respondent
and the respondent waives the opportunity for a hearing as provided in
subpart E of this part.
(c) In the cases described in paragraph (a) of this section, within
30 days after the date of service of the initial determination, a party
adversely affected by the Director's Determination may file in
accordance with Sec. 16.13 and serve in accordance with Sec. 16.15 a
simultaneous Notice of Appeal and Brief.
(d) A reply to an appeal brief may be filed within 20 days after
the date of service of the appeal.
(e) On appeal, the Associate Administrator will consider the issues
addressed in any order on a motion to dismiss or motion for summary
judgment and any issues accepted in the Director's Determination using
the following analysis:
(1) Are the findings of fact each supported by a preponderance of
reliable, probative, and substantial evidence contained in the record?
(2) Are conclusions made in accordance with law, precedent and
policy?
(3) Are the questions on appeal substantial?
(4) Have any prejudicial errors occurred?
(f) Any new issues or evidence presented in an appeal or reply will
not be considered unless accompanied by a petition and good cause found
as to why the new issue or evidence was not presented to the Director.
Such a petition must:
(1) Set forth the new matter;
(2) Contain affidavits of prospective witnesses, authenticated
documents, or both, or an explanation of why such substantiation is
unavailable; and
(3) Contain a statement explaining why such new issue or evidence
could not have been discovered in the exercise of due diligence prior
to the date on which the evidentiary record closed.
(g) The Associate Administrator will issue a final decision and
order within 60 days after the due date of the reply.
(h) If no appeal is filed within the time period specified in
paragraph (c) of this section, the Director's Determination becomes the
final decision and order of the FAA without further action. A
Director's Determination that becomes final, because there is no
administrative appeal, is not judicially reviewable.
(i) No requests for rehearing, reargument, reconsideration, or
modification of a final order will be considered without a finding of
good cause.
17. Add Sec. 16.34 to read as follows:

Sec. 16.34 Consent orders.

(a) The parties may agree at any time before the issuance of a
final agency decision to dispose of the case by issuance of a consent
order. Good faith efforts to resolve a complaint through issuance of a
consent order may continue throughout the administrative process.
However, except as provided in Sec. 16.11(a), such efforts may not
serve as the basis for extensions of the times set forth in this part.
(b) A proposal for a consent order, specified in paragraph (a) of
this section, shall include:
(1) A proposed consent order;
(2) An admission of all jurisdictional facts; and
(3) An express waiver of the right to further procedural steps and
of all rights of judicial review.
(c) If the parties agree to dispose of a case by issuance of a
consent order before the FAA issues a Director's Determination, the
proposal for a consent order is submitted jointly by the parties to the
Director, together with a request to adopt the consent order and
dismiss the case. The Director issues the consent order as an order of
the FAA and terminates the proceeding.

Sec. 16.105 [Amended]

18. Amend Sec. 16.105 by removing ``determination'' and adding
``Determination'' in its place.
19. Revise Sec. 16.109 to read as follows:

Sec. 16.109 Orders terminating eligibility for grants, cease and
desist orders, and other compliance orders.

(a) The agency will provide the opportunity for a hearing if, in
the Director's determination, the agency issues or proposes to issue an
order terminating eligibility for grants pursuant to 49 U.S.C.
47106(d), an order suspending the payment of grant funds pursuant to 49
U.S.C. 47111(d), an order withholding approval of any new application
to impose a passenger facility charge pursuant to 49 U.S.C. 47111(e), a
cease and desist order, an order directing the refund of fees
unlawfully collected, or any other compliance order issued by the
Administrator to carry out the provisions of the Acts, and required to
be issued after notice and opportunity for a hearing. In cases in which
a hearing is not required by statute, the FAA may provide opportunity
for a hearing at its discretion.

[[Page 13041]]

(b) In a case in which the agency provides the opportunity for a
hearing, the Director's Determination issued under Sec. 16.31 will
include a statement of the availability of a hearing under subpart F of
this part.
(1) Within 20 days after service of a Director's Determination
under Sec. 16.31 that provides an opportunity for a hearing a person
subject to the proposed compliance order may--
(i) Request a hearing under subpart F of this part;
(ii) Waive hearing and appeal the Director's Determination in
writing, as provided in Sec. 16.33;
(iii) File, jointly with a complainant, a motion to withdraw the
complaint and to dismiss the proposed compliance action; or
(iv) Submit, jointly with the agency, a proposed consent order
under Sec. 16.34(c).
(2) If the respondent fails to file an appeal in writing within the
time periods provided in paragraph (c) of this section, the Director's
Determination becomes final.
(c) The Director may either direct the respondent to submit a
Corrective Action Plan or initiate proceedings to revoke and/or deny
the respondent's application for Airport Improvement Program
discretionary grants under 49 U.S.C. 47115 and general aviation airport
grants under 49 U.S.C. 47114(d) when a Director's Determination finds a
respondent in noncompliance and does not provide for a hearing.
(d) In the event that the respondent fails to submit, in accordance
with a Director's Determination, a Corrective Action Plan acceptable to
the FAA within the time provided, unless extended by the FAA for good
cause, and/or if the respondent fails to complete the Corrective Action
Plan as specified therein, the Director may initiate action to revoke
and/or deny applications for Airport Improvement Program discretionary
grants under 49 U.S.C. 47115 and general aviation airport grants under
49 U.S.C. 47114(d).
(e) For those violations that cannot be remedied through corrective
action the Director may initiate action to revoke and/or deny the
respondent's applications for Airport Improvement Program discretionary
grants under 49 U.S.C. 47115 and general aviation airport grants under
49 U.S.C. 47114(d).
(f) When the Director concludes that the respondent has fully
complied with the Corrective Action Plan and/or when the Director
determines that the respondent has corrected the areas of
noncompliance, the Director will terminate the proceeding.
(g) A complainant's standing terminates upon the issuance of a
Director's Determination that finds a respondent in noncompliance on
all identified issues. The complainant may not appeal the Director's
Determination if the Director finds noncompliance on all identified
issues.
20. Amend Sec. 16.201 by revising paragraph (b) to read as
follows:

Sec. 16.201 Notice and order of hearing.

* * * * *
(b) Where there are no genuine issues of material fact requiring
oral examination of witnesses, the hearing order may contain a
direction to the hearing officer to conduct a hearing by submission of
briefs and oral argument without the presentation of testimony or other
evidence.
21. Amend Sec. 16.203 by revising paragraphs (a)(1), (b)(1), and
(b)(2) to read as follows:

Sec. 16.203 Appearances, parties, and rights of parties.

(a) * * *
(1) Any party may be accompanied, represented, or advised by an
attorney licensed by a State, the District of Columbia, or a territory
of the United States to practice law or appear before the courts of
that State or territory, or by another person authorized by the hearing
officer to be the party's representative.
* * * * *
(b) * * *
(1) The parties to the hearing are the complainant(s) and
respondent(s) named in the hearing order, and the agency. The style of
any pleadings filed under this Subpart shall name the respondent as the
Appellant, and the Federal Aviation Administration as the Agency.
(2) Unless otherwise specified in the hearing order, the agency
attorney will serve as prosecutor for the agency from the date of
issuance of the Director's Determination providing an opportunity for
hearing.
22. Revise Sec. 16.207 to read as follows:

Sec. 16.207 Intervention and other participation.

(a) Intervention and participation by other persons are permitted
only at the hearing stage of the complaint process and with the written
approval of the hearing officer.
(b) A person may submit a written motion for leave to intervene as
a party. Except for good cause shown, a motion for leave to intervene
shall be submitted not later than 10 days after the notice of hearing
and hearing order.
(c) If the hearing officer finds that intervention will not unduly
broaden the issues or delay the proceedings and, if the person has an
interest that will benefit the proceedings, the hearing officer may
grant a motion for leave to intervene. The hearing officer may
determine the extent to which an intervenor may participate in the
proceedings.
(d) Other persons may petition the hearing officer for leave to
participate in the hearing. Participation is limited to the filing of a
posthearing brief and reply to the hearing officer and the Associate
Administrator. Such a brief shall be filed and served on all parties in
the same manner as the parties' posthearing briefs are filed.
(e) Participation under this section is at the discretion of the
hearing officer, and no decision permitting participation shall be
deemed to constitute an expression that the participant has such a
substantial interest in the proceeding as would entitle it to judicial
review of such decision.
23. In Sec. 16.211, revise the last sentence in paragraph (c) to
read as follows:

Sec. 16.211 Prehearing conference.

* * * * *
(c) * * * In addition, the hearing officer establishes the
schedule, which shall provide for the issuance of an initial decision
not later than 110 days after issuance of the Director's Determination
order unless otherwise provided in the hearing order.
24. Amend Sec. 16.215 by adding paragraph (e) to read as follows:

Sec. 16.215 Depositions.

* * * * *
(e) Depositions of agency employees. (1) Depositions of Agency
Employees will not be allowed except under the provisions of 49 CFR
part 9.
(2) Such depositions will be allowed only with the specific written
permission of the Chief Counsel or his designee.
25. Revise Sec. 16.227 to read as follows:

Sec. 16.227 Standard of proof.

The hearing officer shall issue an initial decision or rule in a
party's favor only if the decision or ruling is in accordance with law
and supported by a preponderance of the reliable, probative, and
substantial evidence contained in the record.
26. Amend Sec. 16.229 by adding introductory text to read as
follows:

Sec. 16.229 Burden of proof.

As used in this subpart, the burden of proof is as follows:
* * * * *
27. Revise Sec. 16.233 to read as follows:

[[Page 13042]]

Sec. 16.233 Record.

(a) Exclusive record. The transcript of all testimony in the
hearing, all exhibits received into evidence, all motions, applications
requests and rulings, all documents included in the hearing record and
the Director's Determination shall constitute the exclusive record for
decision in the proceedings and the basis for the issuance of any
orders.
(b) Examination and copy of record. A copy of the record will be
filed by the FAA Part 16 Docket Clerk in the Federal Docket Management
System (FDMS). Any person desiring to review the record may then do so
at http://www.regulations.gov.
28. Amend Sec. 16.235 by revising paragraph (b) to read as
follows:

Sec. 16.235 Argument before the hearing officer.

* * * * *
(b) Posthearing Briefs. The hearing officer may request or permit
the parties to submit posthearing briefs. The hearing officer may
provide for the filing of simultaneous reply briefs as well, if such
filing will not unduly delay the issuance of the hearing officer's
initial decision. Posthearing briefs shall include proposed findings of
fact and conclusions of law; exceptions to rulings of the hearing
officer; references to the record in support of the findings of fact;
and supporting arguments for the proposed findings, proposed
conclusions, and exceptions.

Sec. Sec. 16.241 and 16.243 [Transferred to Subpart F]

29. Sections 16.241 and 16.243 are transferred from subpart G to
subpart F.

Subpart G--[Removed and Reserved]

30. Remove and reserve subpart G.
31. Amend Sec. 16.241 by revising paragraphs (a) and (c) and
removing paragraph (f).
The revisions read as follows:

Sec. 16.241 Initial decisions, order, and appeals.

(a) The hearing officer shall issue an initial decision based on
the record developed during the proceeding and shall send the initial
decision to the parties not later than 110 days after the Director's
Determination unless otherwise provided in the hearing order.
* * * * *
(c) If an appeal is filed, the Associate Administrator reviews the
entire record and issues a final agency decision and order within 60
days of the due date of the reply. If no appeal is filed, the Associate
Administrator may take review of the case on his or her own motion. If
the Associate Administrator finds that the respondent is not in
compliance with any Act or any regulation, agreement, or document of
conveyance issued or made under such Act, the final agency order
includes, in accordance with Sec. 16.245(d), a statement of corrective
action, if appropriate, and identifies sanctions for continued
noncompliance.
* * * * *
32. Add Sec. 16.245 to subpart F to read as follows:

Sec. 16.245 Associate Administrator review after a hearing.

(a) The Associate Administrator may transfer to the FAA Assistant
Administrator for Civil Rights the authority to prepare and issue Final
Agency Decisions pursuant to Sec. 16.241 for appeals from a hearing
concerning civil rights issues.
(b) After a hearing is held, and, after considering the issues as
set forth in Sec. 16.245(e), if the Associate Administrator determines
that the hearing officer's initial decision or order should be changed,
the Associate Administrator may:
(1) Make any necessary findings and issue an order in lieu of the
hearing officer's initial decision or order, or
(2) Remand the proceeding for any such purpose as the Associate
Administrator may deem necessary.
(c) If the Associate Administrator takes review of the hearing
officer's initial decision on the Associate Administrator's own motion,
the Associate Administrator issues a notice of review within 20 days of
the actual date the initial decision is issued.
(1) The notice sets forth the specific findings of fact and
conclusions of law in the initial decision that are subject to review
by the Associate Administrator.
(2) Parties may file one brief on review to the Associate
Administrator or rely on their posthearing brief to the hearing
officer. A brief on review shall be filed not later than 10 days after
service of the notice of review. Filing and service of a brief on
review shall be by personal delivery.
(3) The Associate Administrator issues a final agency decision and
order within 30 days of the due date of the brief. If the Associate
Administrator finds that the respondent is not in compliance with any
Act or any regulation, agreement or document of conveyance issued under
such Act, the final agency order includes a statement of corrective
action, if appropriate.
(d) When the final agency decision finds a respondent in
noncompliance, and where a respondent fails to properly appeal the
final agency decision as set forth in subpart G, of this part, the
Associate Administrator will issue an order remanding the case to the
Director for the following action:
(1) In the event that the respondent fails to submit, in accordance
with the final agency decision, a Corrective Action Plan acceptable to
the FAA within the time provided, unless extended by the FAA for good
cause, and/or if the respondent fails to complete the Corrective Action
Plan as specified therein, the Director may initiate action to revoke
and/or deny applications for Airport Improvement Program grants under
49 U.S.C. 47114(c)-(e) and 47115. When the Director concludes that the
respondent has fully complied with the Corrective Action Plan, the
Director will issue an Order terminating the proceeding.
(2) For those violations that cannot be remedied through corrective
action the Director may initiate action to revoke and/or deny the
respondent's applications for Airport Improvement Program grants under
49 U.S.C. 47114(c)-(e) and 47115.
(e) On appeal from a hearing officer's initial decision, the
Associate Administrator will consider the following issues:
(1) Are the findings of fact each supported by a preponderance of
reliable, probative and substantial evidence.
(2) Are conclusions made in accordance with law, precedent and
policy.
(3) Are the questions on appeal substantial.
(4) Have any prejudicial errors occurred.
(f) Any new issues or evidence presented in an appeal or reply will
not be allowed unless accompanied by a certified petition and good
cause found as to why the new matter was not presented to the Director.
Such a petition must:
(1) Set forth the new matter;
(2) Contain affidavits of prospective witnesses, authenticated
documents, or both, or an explanation of why such substantiation is
unavailable; and
(3) Contain a statement explaining why such new matter could not
have been discovered in the exercise of due diligence prior to the date
on which the evidentiary record closed.
(g) A Final Agency Decision may be appealed in accordance with
subpart G of this part.

Subparts H and I--[Redesignated as Subparts G and H]

33. Redesignate subpart H, consisting of Sec. 16.247, and subpart
I, consisting of Sec. Sec. 16.301, 16.303, 16.305, and 16.307, as
subparts G and H, respectively.

[[Page 13043]]

34. In Sec. 16.247, revise paragraphs (a), (b)(2), and (b)(4) to
read as follows:

Sec. 16.247 Judicial review of a final decision and order.

(a) A person may seek judicial review, in a United States Court of
Appeals, of a final decision and order of the Associate Administrator,
and of an order of dismissal with prejudice issued by the Director, as
provided in 49 U.S.C. 46110 or section 519(b)(4) of the Airport and
Airway Improvement Act of 1982 (AAIA), as amended and recodified, 49
U.S.C. 47106(d) and 47111(d). A party seeking judicial review shall
file a petition for review with the Court not later than 60 days after
the order has been served on the party or within 60 days after the
entry of an order under 49 U.S.C. 40101 et seq.
(b) * * *
(2) A Director's Determination;
* * * * *
(4) A Director's Determination or an initial decision of a hearing
officer that becomes the final decision of the Associate Administrator
because it was not appealed within the applicable time periods provided
under Sec. Sec. 16.33(c) and 16.241(b).

Sec. 16.301 [Removed]

35. Remove Sec. 16.301 from newly redesignated subpart H.

Sec. Sec. 16.303, 16.305, and 16.307 [Redesignated as Sec. Sec.
16.301, 16.303, and 16.305]

36. In newly redesignated subpart H, redesignate Sec. Sec. 16.303,
16.305, and 16.307 as Sec. Sec. 16.301, 16.303, and 16.305,
respectively.

Issued in Washington, DC, on February 22, 2012.
Daphne A. Fuller,
Manager, Airports and Environmental Law Division.
[FR Doc. 2012-4993 Filed 3-2-12; 8:45 am]
BILLING CODE 4910-13-P