[Federal Register Volume 82, Number 8 (Thursday, January 12, 2017)]
[Rules and Regulations]
[Pages 3633-3637]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2017-00160]
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ENVIRONMENTAL PROTECTION AGENCY
40 CFR Part 19
[FRL-9958-06-OECA]
Civil Monetary Penalty Inflation Adjustment Rule
AGENCY: Environmental Protection Agency (EPA).
ACTION: Final rule.
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SUMMARY: The Environmental Protection Agency (EPA) is promulgating this
final rule to adjust the level of statutory civil monetary penalty
amounts under the statutes EPA administers. This action is mandated by
the Federal Civil Penalties Inflation Adjustment Act of 1990, as
[[Page 3634]]
amended through the Federal Civil Penalties Inflation Adjustment Act
Improvements Act of 2015 (``the 2015 Act''). The 2015 Act prescribes a
formula for annually adjusting statutory civil penalties to reflect
inflation, maintain the deterrent effect of statutory civil penalties,
and promote compliance with the law. The rule does not necessarily
revise the penalty amounts that EPA chooses to seek pursuant to its
civil penalty policies in a particular case. EPA's civil penalty
policies, which guide enforcement personnel in how to exercise EPA's
statutory penalty authorities, take into account a number of fact-
specific considerations, e.g., the seriousness of the violation, the
violator's good faith efforts to comply, any economic benefit gained by
the violator as a result of its noncompliance, and a violator's ability
to pay.
DATES: This final rule is effective on January 15, 2017.
FOR FURTHER INFORMATION CONTACT: David Smith-Watts, Office of Civil
Enforcement, Office of Enforcement and Compliance Assurance, Mail Code
2241A, Environmental Protection Agency, 1200 Pennsylvania Avenue NW.,
Washington, DC 20460, telephone number: (202) 564-4083; [email protected].
SUPPLEMENTARY INFORMATION:
I. Background
Since 1990, Federal agencies have been required to issue
regulations adjusting for inflation the statutory civil penalties \1\
that can be imposed under the laws administered by that agency. The
Federal Civil Penalties Inflation Adjustment Act of 1990, as amended by
the Debt Collection Improvement Act of 1996 (DCIA), required agencies
to review their statutory civil penalties every 4 years, and to adjust
the statutory civil penalty amounts for inflation if the increase met
the DCIA's adjustment methodology. In accordance with the DCIA, EPA
reviewed and, as appropriate, adjusted the civil penalty levels under
each of the statutes the agency implements in 1996 (61 FR 69360), 2004
(69 FR 7121), 2008 (73 FR 75340), and 2013 (78 FR 66643).
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\1\ The Federal Civil Penalties Inflation Adjustment Act of
1990, Public Law 101-410, 28 U.S.C. 2461 note, defines ``civil
monetary penalty'' as ``any penalty, fine, or other sanction that--
(A)(i) is for a specific monetary amount as provided by Federal law;
or (ii) has a maximum amount provided for by Federal law; and (B) is
assessed or enforced by an agency pursuant to Federal law; and (C)
is assessed or enforced pursuant to an administrative proceeding or
a civil action in the Federal courts.''
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The 2015 Act \2\ requires agencies to: (1) Adjust the level of
statutory civil penalties with an initial ``catch-up'' adjustment
through an interim final rulemaking; and (2) beginning January 15,
2017, make subsequent annual adjustments for inflation. The purpose of
the 2015 Act is to maintain the deterrent effect of civil penalties by
translating originally enacted statutory civil penalty amounts to
today's dollars and rounding statutory civil penalties to the nearest
dollar.
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\2\ The Federal Civil Penalties Inflation Adjustment Act
Improvements Act of 2015 (Section 701 of Pub. L. 114-74) was signed
into law on Nov. 2, 2015, and further amended the Federal Civil
Penalties Inflation Adjustment Act of 1990.
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As required by the 2015 Act, EPA issued a catch up rule on July 1,
2016, which was effective August 1, 2016 (81 FR 43091). This rule
implements the annual penalty inflation adjustments mandated by the
2015 Act. Beginning in 2017, Section 4 of the 2015 Act requires each
federal agency to publish annual adjustments to all civil penalties
under the laws implemented by that agency. These annual adjustments are
required to be published by January 15 of each year. The 2015 Act
describes the method for calculating the adjustments. Each statutory
maximum civil monetary penalty is multiplied by the cost-of-living
adjustment, which is the percentage by which the Consumer Price Index
for all Urban Consumers (CPI-U) for the month of October 2016 exceeds
the CPI-U for the month of October 2015.
With this rule, the new statutory maximum (or minimum \3\) penalty
levels listed in Table 2 to 40 CFR 19.4 will apply to all statutory
civil penalties assessed on or after January 15, 2017, for violations
that occurred after November 2, 2015, when the 2015 Act was enacted.
The statutory civil penalty levels, as codified at Table 1 to 40 CFR
19.4, will continue to apply to: (1) Violations that occurred on or
before November 2, 2015, and (2) violations that occurred after
November 2, 2015, where the penalty assessment was made prior to August
1, 2016.
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\3\ Under Section 3(2)(A) of the 2015 Act, ``civil monetary
penalty'' means ``a specific monetary amount as provided by Federal
law''; or ``has a maximum amount provided for by Federal law.'' EPA-
administered statutes generally refer to statutory maximum
penalties, with the following exceptions: Section 311(b)(7)(D) of
the Clean Water Act, 33 U.S.C. 1321(b)(7)(D), refers to a minimum
penalty of ``not less than $100,000 . . .''; Section 104B(d)(1) of
the Marine Protection, Research, and Sanctuaries Act, 33 U.S.C.
1414b(d)(1), refers to an exact penalty of $600 ``[f]or each dry ton
(or equivalent) of sewage sludge or industrial waste dumped or
transported by the person in violation of this subsection in
calendar year 1992. . .''; and Section 325(d)(1) of the Emergency
Planning and Community Right-to-Know Act, 42 U.S.C. 11045(d)(1),
refers to an exact civil penalty of $25,000 for each frivolous trade
secret claim.
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The formula for determining the cost-of-living or inflation
adjustment to statutory civil penalties consists of the following
steps:
Step 1: The cost-of-living adjustment multiplier for 2017, based on
the CPI-U of October 2016, is 1.01636.\4\ Multiply 1.01636 by the
current penalty amount. This is the raw adjusted penalty value.
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\4\ Office of Management and Budget Memorandum, Implementation
of the 2017 annual adjustment pursuant to the Federal Civil
Penalties Inflation Adjustment Act Improvements Act of 2015 (OMB
Memorandum M-17-11) at p. 1 (December 16, 2016).
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Step 2: Round the raw adjusted penalty value. Section 5 of the 2015
Act states that any adjustment shall be rounded to the nearest multiple
of $1. The result is the final penalty value for the year.
II. The 2015 Act Requires Federal Agencies To Publish Annual Penalty
Inflation Adjustments Notwithstanding Section 553 of the Administrative
Procedures Act
Section 4 of the 2015 Act directs federal agencies to publish
annual adjustments no later than January 15, 2017. In accordance with
section 553 of the Administrative Procedures Act (APA), most rules are
subject to notice and comment and are effective no earlier than 30 days
after publication in the Federal Register. However, Section 4(b)(2) of
the 2015 Act provides that each agency shall make the annual inflation
adjustments ``notwithstanding section 553'' of the APA. According to
OMB guidance issued to Federal agencies on the implementation of the
2017 annual adjustment,\5\ the phrase ``notwithstanding section 553''
means that ``the public procedure the APA generally provides--notice,
an opportunity for comment, and a delay in effective date--is not
required for agencies to issue regulations implementing the annual
adjustment.'' Consistent with the language of the 2015 Act and OMB's
implementation guidance, this rule is not subject to notice and an
opportunity for public comment and will be effective immediately upon
publication.
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\5\ See OMB Memorandum M-17-11 at p. 3.
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III. Statutory and Executive Order Reviews
A. Executive Order 12866: Regulatory Planning and Review and Executive
Order 13563: Improving Regulation and Regulatory Review
Under Executive Order 12866, OMB determined this final rule to be a
``non-significant'' regulatory action and, therefore, it did not
undergo interagency review.\6\
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\6\ See OMB Memorandum M-17-11 at p. 3.
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[[Page 3635]]
B. Paperwork Reduction Act (PRA)
This action does not impose an information collection burden under
the PRA. This rule merely increases the level of statutory civil
penalties that could be imposed in the context of a Federal civil
administrative enforcement action or civil judicial case for violations
of EPA-administered statutes and their implementing regulations.
C. Regulatory Flexibility Act (RFA)
This action is not subject to the RFA. The RFA applies only to
rules subject to notice and comment rulemaking requirements under the
APA, 5 U.S.C. 553, or any other statute. Because the 2015 Act directs
Federal agencies to publish this rule notwithstanding section 553 of
the APA, this rule is not subject to notice and comment requirements or
the RFA.
D. Unfunded Mandates Reform Act (UMRA)
This action does not contain any unfunded mandate as described in
UMRA, 2 U.S.C. 1531-1538, and does not significantly or uniquely affect
small governments. This action is required by the 2015 Act, without the
exercise of any policy discretion by EPA. This action also imposes no
enforceable duty on any state, local or tribal governments or the
private sector. Because the calculation of any increase is formula-
driven pursuant to the 2015 Act, EPA has no policy discretion to vary
the amount of the adjustment.
E. Executive Order 13132: Federalism
This action does not have federalism implications. It will not have
a substantial direct effect on the states, or on the relationship
between the national government and the states, or on the distribution
of power and responsibilities among the various levels of government.
F. Executive Order 13175: Consultation and Coordination With Indian
Tribal Governments
This action does not have tribal implications as specified in
Executive Order 13175. This rule merely reconciles the real value of
current statutory civil penalty levels to reflect and keep pace with
the levels originally set by Congress when the statutes were enacted.
The calculation of the increases is formula-driven and prescribed by
statute, and EPA has no discretion to vary the amount of the adjustment
to reflect any views or suggestions provided by commenters.
Accordingly, this rule will not have a substantial direct effect on
tribal governments, on the relationship between the Federal government
and Indian tribes, or on the distribution of power and responsibilities
between the Federal government and Indian tribes.
G. Executive Order 13045: Protection of Children From Environmental
Health Risks and Safety Risks
The EPA interprets Executive Order 13045 as applying only to those
regulatory actions that concern environmental health or safety risks
that EPA has reason to believe may disproportionately affect children,
per the definition of ``covered regulatory action'' in section 2-202 of
the Executive Order. This action is not subject to Executive Order
13045 because it does not concern an environmental health risk or
safety risk.
H. Executive Order 13211: Actions That Significantly Affect Energy
Supply, Distribution, or Use
This action is not subject to Executive Order 13211 because it is
not a significant regulatory action under Executive Order 12866.
I. National Technology Transfer and Advancement Act
The rule does not involve technical standards.
J. Executive Order 12898: Federal Actions To Address Environmental
Justice in Minority Populations and Low-Income Populations
The EPA believes that this action is not subject to Executive Order
12898 (59 FR 7629, February 16, 1994) because it does not establish an
environmental health or safety standard. Rather, this action is
mandated by the 2015 Act, which prescribes a formula for adjusting
statutory civil penalties on an annual basis to reflect inflation.
K. Congressional Review Act (CRA)
This action is subject to the CRA, and EPA will submit a rule
report to each House of the Congress and to the Comptroller General of
the United States. The CRA allows the issuing agency to make a rule
effective sooner than otherwise provided by the CRA if the agency finds
that notice and comment rulemaking procedures are impracticable,
unnecessary or contrary to the public interest (5 U.S.C. 808(2)). The
2015 Act directs Federal agencies to publish their annual penalty
inflation adjustments ``notwithstanding section 553 [of the APA].''
Because OMB has instructed Federal agencies that this provision means
that ``notice, an opportunity for comment, and a delay in the effective
date'' are not required for agencies to issue regulations implementing
the annual adjustment,\7\ EPA finds that the APA's notice and comment
rulemaking procedures are impracticable, unnecessary or contrary to the
public interest.
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\7\ See OMB Memorandum M-17-11 at p. 3.
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List of Subjects in 40 CFR Part 19
Environmental protection, Administrative practice and procedure,
Penalties.
Dated: January 3, 2017.
Gina McCarthy,
Administrator.
For the reasons set out in the preamble, EPA amends title 40,
chapter I, part 19 of the Code of Federal Regulations as follows:
PART 19--ADJUSTMENT OF CIVIL MONETARY PENALTIES FOR INFLATION
0
1. The authority citation for part 19 continues to read as follows:
Authority: Pub. L. 101-410, Oct. 5, 1990, 104 Stat. 890, as
amended by Pub. L. 104-134, title III, sec. 31001(s)(1), Apr. 26,
1996, 110 Stat. 1321-373; Pub. L. 105-362, title XIII, sec. 1301(a),
Nov. 10, 1998, 112 Stat. 3293; Pub. L. 114-74, title VII, sec.
701(b), Nov. 2, 2015, 129 Stat. 599.
0
2. Revise Sec. 19.2 to read as follows:
Sec. 19.2 Effective date.
The penalty levels in the last column of Table 1 to Sec. 19.4
apply to all violations which occurred after December 6, 2013 through
November 2, 2015, and to violations occurring after November 2, 2015,
where penalties are assessed before August 1, 2016. The statutory civil
penalty levels set forth in the fourth column of Table 2 to Sec. 19.4
apply to all violations which occur after November 2, 2015, where the
penalties are assessed on or after August 1, 2016 and before January
15, 2017. The statutory civil penalty levels set forth in the last
column of Table 2 to Sec. 19.4 apply to all violations which occur
after November 2, 2015, where the penalties are assessed on or after
January 15, 2017.
0
3. Amend Sec. 19.4 by revising the introductory text and Table 2 to
read as follows:
Sec. 19.4 Statutory civil penalties, as adjusted for inflation, and
tables.
Table 1 to Sec. 19.4 sets out the statutory civil penalty
provisions of statutes administered by EPA, with the original statutory
civil penalty levels, as enacted, and the operative statutory civil
penalty levels, as adjusted for inflation, for violations occurring on
or before
[[Page 3636]]
November 2, 2015, and for violations occurring after November 2, 2015,
where penalties are assessed before August 1, 2016. Table 2 sets out
the statutory civil penalty provisions of statutes administered by EPA,
with the third column displaying the original statutory civil penalty
levels, as enacted. The fourth column of Table 2 displays the operative
statutory civil penalty levels where penalties are assessed on or after
August 1, 2016 but before January 15, 2017, for violations that
occurred after November 2, 2015; the last column displays the operative
statutory civil penalty levels where penalties are assessed on or after
January 15, 2017, for violations that occurred after November 2, 2015.
* * * * *
Table 2 of Section 19.4--Civil Monetary Penalty Inflation Adjustments
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Statutory civil
penalties for Statutory civil
violations that penalties for
Statutory civil occurred after violations that
U.S. Code citation Environmental penalties, as November 2, 2015 and occurred after
statute enacted assessed on or after November 2, 2015 and
August 1, 2016 but assessed on or after
before January 15, January 15, 2017
2017
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7 U.S.C. 136l.(a)(1)......... Federal $5,000 $18,750 $19,057
Insecticide,
Fungicide, and
Rodenticide
Act (FIFRA).
7 U.S.C. 136l.(a)(2) \1\..... FIFRA.......... $1,000/$500/$1,000 $2,750/$1,772/$2,750 $2,795/$1,801/$2,795
15 U.S.C. 2615(a)(1)......... Toxic $25,000 $37,500 $38,114
Substances
Control Act
(TSCA).
15 U.S.C. 2647(a)............ TSCA........... $5,000 $10,781 $10,957
15 U.S.C. 2647(g)............ TSCA........... $5,000 $8,908 $9,054
31 U.S.C. 3802(a)(1)......... Program Fraud $5,000 $10,781 $10,957
Civil Remedies
Act (PFCRA).
31 U.S.C. 3802(a)(2)......... PFCRA.......... $5,000 $10,781 $10,957
33 U.S.C. 1319(d)............ Clean Water Act $25,000 $51,570 $52,414
(CWA).
33 U.S.C. 1319(g)(2)(A)...... CWA............ $10,000/$25,000 $20,628/$51,570 $20,965/$52,414
33 U.S.C. 1319(g)(2)(B)...... CWA............ $10,000/$125,000 $20,628/$257,848 $20,965/$262,066
33 U.S.C. 1321(b)(6)(B)(i)... CWA............ $10,000/$25,000 $17,816/$44,539 $18,107/$45,268
33 U.S.C. 1321(b)(6)(B)(ii).. CWA............ $10,000/$125,000 $17,816/$222,695 $18,107/$226,338
33 U.S.C. 1321(b)(7)(A)...... CWA............ $25,000/$1,000 $44,539/$1,782 $45,268/$1,811
33 U.S.C. 1321(b)(7)(B)...... CWA............ $25,000 $44,539 $45,268
33 U.S.C. 1321(b)(7)(C)...... CWA............ $25,000 $44,539 $45,268
33 U.S.C. 1321(b)(7)(D)...... CWA............ $100,000/$3,000 $178,156/$5,345 $181,071/$5,432
33 U.S.C. 1414b(d)(1)........ Marine $600 $1,187 $1,206
Protection,
Research, and
Sanctuaries
Act (MPRSA).
33 U.S.C. 1415(a)............ MPRSA.......... $50,000/$125,000 $187,500/$247,336 $190,568/$251,382
33 U.S.C. 1901 note (see Certain Alaskan $10,000/$25,000 $13,669/$34,172 $13,893/$34,731
1409(a)(2)(A)). Cruise Ship
Operations
(CACSO).
33 U.S.C. 1901 note (see CACSO.......... $10,000/$125,000 $13,669/$170,861 $13,893/$173,656
1409(a)(2)(B)).
33 U.S.C. 1901 note (see CACSO.......... $25,000 $34,172 $34,731
1409(b)(1)).
33 U.S.C. 1908(b)(1)......... Act To Prevent $25,000 $70,117 $71,264
Pollution From
Ships (APPS).
33 U.S.C. 1908(b)(2)......... APPS........... $5,000 $14,023 $14,252
42 U.S.C. 300g-3(b).......... Safe Drinking $25,000 $53,907 $54,789
Water Act
(SDWA).
42 U.S.C. 300g-3(g)(3)(A).... SDWA........... $25,000 $53,907 $54,789
42 U.S.C. 300g-3(g)(3)(B).... SDWA........... $5,000/$25,000 $10,781/$37,561 $10,957/$38,175
42 U.S.C. 300g-3(g)(3)(C).... SDWA........... $25,000 $37,561 $38,175
42 U.S.C. 300h-2(b)(1)....... SDWA........... $25,000 $53,907 $54,789
42 U.S.C. 300h-2(c)(1)....... SDWA........... $10,000/$125,000 $21,563/$269,535 $21,916/$273,945
42 U.S.C. 300h-2(c)(2)....... SDWA........... $5,000/$125,000 $10,781/$269,535 $10,957/$273,945
42 U.S.C. 300h-3(c).......... SDWA........... $5,000/$10,000 $18,750/$40,000 $19,057/$40,654
42 U.S.C. 300i(b)............ SDWA........... $15,000 $22,537 $22,906
42 U.S.C. 300i-1(c).......... SDWA........... $100,000/$1,000,000 $131,185/$1,311,850 $133,331/$1,333,312
42 U.S.C. 300j(e)(2)......... SDWA........... $2,500 $9,375 $9,528
42 U.S.C. 300j-4(c).......... SDWA........... $25,000 $53,907 $54,789
42 U.S.C. 300j-6(b)(2)....... SDWA........... $25,000 $37,561 $38,175
42 U.S.C. 300j-23(d)......... SDWA........... $5,000/$50,000 $9,893/$98,935 $10,055/$100,554
42 U.S.C. 4852d(b)(5)........ Residential $10,000 $16,773 $17,047
Lead-Based
Paint Hazard
Reduction Act
of 1992.
42 U.S.C. 4910(a)(2)......... Noise Control $10,000 $35,445 $36,025
Act of 1972.
42 U.S.C. 6928(a)(3)......... Resource $25,000 $93,750 $95,284
Conservation
and Recovery
Act (RCRA).
42 U.S.C. 6928(c)............ RCRA........... $25,000 $56,467 $57,391
42 U.S.C. 6928(g)............ RCRA........... $25,000 $70,117 $71,264
42 U.S.C. 6928(h)(2)......... RCRA........... $25,000 $56,467 $57,391
42 U.S.C. 6934(e)............ RCRA........... $5,000 $14,023 $14,252
42 U.S.C. 6973(b)............ RCRA........... $5,000 $14,023 $14,252
42 U.S.C. 6991e(a)(3)........ RCRA........... $25,000 $56,467 $57,391
42 U.S.C. 6991e(d)(1)........ RCRA........... $10,000 $22,587 $22,957
42 U.S.C. 6991e(d)(2)........ RCRA........... $10,000 $22,587 $22,957
42 U.S.C. 7413(b)............ Clean Air Act $25,000 $93,750 $95,284
(CAA).
42 U.S.C. 7413(d)(1)......... CAA............ $25,000/$200,000 $44,539/$356,312 $45,268/$362,141
42 U.S.C. 7413(d)(3)......... CAA............ $5,000 $8,908 $9,054
42 U.S.C. 7524(a)............ CAA............ $25,000/$2,500 $44,539/$4,454 $45,268/$4,527
42 U.S.C. 7524(c)(1)......... CAA............ $200,000 $356,312 $362,141
42 U.S.C. 7545(d)(1)......... CAA............ $25,000 $44,539 $45,268
42 U.S.C. 9604(e)(5)(B)...... Comprehensive $25,000 $53,907 $54,789
Environmental
Response,
Compensation,
and Liability
Act (CERCLA).
42 U.S.C. 9606(b)(1)......... CERCLA......... $25,000 $53,907 $54,789
42 U.S.C. 9609(a)(1)......... CERCLA......... $25,000 $53,907 $54,789
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42 U.S.C. 9609(b)............ CERCLA......... $25,000/$75,000 $53,907/$161,721 $54,789/$164,367
42 U.S.C. 9609(c)............ CERCLA......... $25,000/$75,000 $53,907/$161,721 $54,789/$164,367
42 U.S.C. 11045(a)........... Emergency $25,000 $53,907 $54,789
Planning and
Community
Right-To-Know
Act (EPCRA).
42 U.S.C. 11045(b)(1)(A)..... EPCRA.......... $25,000 $53,907 $54,789
42 U.S.C. 11045(b)(2)........ EPCRA.......... $25,000/$75,000 $53,907/$161,721 $54,789/$164,367
42 U.S.C. 11045(b)(3)........ EPCRA.......... $25,000/$75,000 $53,907/$161,721 $54,789/$164,367
42 U.S.C. 11045(c)(1)........ EPCRA.......... $25,000 $53,907 $54,789
42 U.S.C. 11045(c)(2)........ EPCRA.......... $10,000 $21,563 $21,916
42 U.S.C. 11045(d)(1)........ EPCRA.......... $25,000 $53,907 $54,789
42 U.S.C. 14304(a)(1)........ Mercury- $10,000 $15,025 $15,271
Containing and
Rechargeable
Battery
Management Act
(Battery Act).
42 U.S.C. 14304(g)........... Battery Act.... $10,000 $15,025 $15,271
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\1\ Note that 7 U.S.C. 136l.(a)(2) contains three separate statutory maximum civil penalty provisions. The first
mention of $1,000 and the $500 statutory maximum civil penalty amount were originally enacted in 1978 (Pub. L.
95-396), and the second mention of $1,000 was enacted in 1972 (Pub. L. 92-516).
[FR Doc. 2017-00160 Filed 1-11-17; 8:45 am]
BILLING CODE 6560-50-P