PHMSA has published a final rule that would prohibit anyone who fails to pay a civil penalty or fails to abide by a payment agreement from performing activities regulated by the Hazardous Materials Regulations until the payment has been made. This final rule applies, generally, to penalties assessed by the four DOT operating administrations that enforce the HMR. Those agencies are FAA, FMCSA, FRA and PHMSA.
Under the provisions of the ruling, the agency that issued the final order outlining the terms and outcome of an enforcement action will send the respondent a Cessation of Operations Order (COO) if payment has not been received within 45 days after the payment was due. The COO would notify the respondent that it must cease hazardous materials operations on the 91st calender day after failing to make payment in accordance with the agency’s final order or payment plan arrangement, unless payment is made. The respondent will then be allowed to appeal the COO within 20 days of the receipt of the order.
However, these agencies caution regulated entities not to construe the right to appeal a COO as an opportunity to re-argue the merits of the penalty assessment. These agencies believe that regulated entities have had ample opportunity to address the merits of any proposed penalty assessment at earlier stages in the agencies’ enforcement process. The only information that would be sufficient enough to prevent the prohibition on hazardous material operations after nonpayment of penalties would be proof of payment, proof of bankruptcy debtor status and an inability to pay or Emergency Stay issued by a Federal District Court with jurisdiction over such matters.
The final rule will be effective September 8, 2014.
