[Federal Register: July 1, 2008 (Volume 73, Number 127)]
[Notices]
[Page 37482-37485]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr01jy08-59]
[[Page 37482]]
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DEPARTMENT OF THE INTERIOR
Minerals Management Service
[Docket No. MMS-2008-MRM-0008]
Agency Information Collection Activities: Submitted for Office of
Management and Budget (OMB) Review; Comment Request
AGENCY: Minerals Management Service (MMS), Interior.
ACTION: Notice of an extension of a currently approved information
collection (OMB Control Number 1010-0122).
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SUMMARY: To comply with the Paperwork Reduction Act of 1995 (PRA), we
are notifying the public that we have submitted to the Office of
Management and Budget (OMB) an information collection request (ICR) to
renew approval of the paperwork requirements in the regulations under
30 CFR part 243. This notice also provides the public a second
opportunity to comment on the paperwork burden of these regulatory
requirements. We changed the title of this ICR to clarify the
regulatory language we are covering under 30 CFR part 243. The previous
title of this ICR was ``30 CFR 243--Suspensions Pending Appeal and
Bonding--Minerals Revenue Management (Forms MMS-4435, Administrative
Appeal Bond; MMS-4436, Letter of Credit; and MMS-4437, Assignment of
Certificate of Deposit).'' The new title of this ICR is ``30 CFR Part
243--Suspensions Pending Appeal and Bonding--Minerals Revenue
Management.''
DATES: Submit written comments on or before July 31, 2008.
ADDRESSES: Submit written comments by either FAX (202) 395-6566 or e-
mail (OIRA_Docket@omb.eop.gov) directly to the Office of Information
and Regulatory Affairs, OMB, Attention: Desk Officer for the Department
of the Interior (OMB Control Number 1010-0122).
Please submit copies of your comments to MMS by the following
methods:
Electronically go to http://www.regulations.gov. In the
``Comment or Submission'' column, enter ``MMS-2008-MRM-0008'' to view
supporting and related materials for this ICR. Click on ``Send a
comment or submission'' link to submit public comments. Information on
using Regulations.gov, including instructions for accessing documents,
submitting comments, and viewing the docket after the close of the
comment period, is available through the site's ``User Tips'' link. All
comments submitted will be posted to the docket.
Mail comments to Armand Southall, Regulatory Specialist,
Minerals Management Service, Minerals Revenue Management, P.O. Box
25165, MS 302B2, Denver, Colorado 80225. Please reference ICR 1010-0122
in your comments.
Hand-carry comments or use an overnight courier service.
Our courier address is Building 85, Room A-614, Denver Federal Center,
West 6th Ave. and Kipling Blvd., Denver, Colorado 80225. Please
reference ICR 1010-0122 in your comments.
FOR FURTHER INFORMATION CONTACT: Armand Southall, telephone (303) 231-
3221, or e-mail armand.southall@mms.gov. You may also contact Armand
Southall to obtain copies, at no cost, of (1) the ICR, (2) any
associated forms, and (3) the regulations that require the subject
collection of information.
SUPPLEMENTARY INFORMATION:
Title: 30 CFR Part 243-Suspensions Pending Appeal and Bonding--
Minerals Revenue Management.
OMB Control Number: 1010-0122.
Bureau Form Number: Forms MMS-4435, MMS-4436, and MMS-4437.
Abstract: The Secretary of the United States Department of the
Interior (Secretary) is responsible for matters relevant to mineral
resource development on Federal and Indian lands and the Outer
Continental Shelf (OCS). The Secretary, under the Mineral Leasing Act
of 1920 (30 U.S.C. 1923), Indian Mineral Development Act of 1982 (Pub.
L. 97-382--Dec. 22, 1982), and the Outer Continental Shelf Lands Act
(43 U.S.C. 1353), is responsible for managing the production of
minerals from Federal and Indian lands and the OCS, collecting
royalties and other mineral revenues from lessees who produce minerals,
and distributing the funds collected in accordance with applicable
laws. The Secretary also has a trust responsibility to manage Indian
lands and seek advice and information from Indian beneficiaries. The
MMS performs the mineral revenue management functions for the Secretary
and assists the Secretary in carrying out the Department's trust
responsibility for Indian lands. Public laws pertaining to mineral
revenues are on our Web site at http://www.mrm.mms.gov/Laws_R_D/
PublicLawsAMR.htm.
Regulations at 30 CFR 243 govern the suspension of orders or
decisions pending administrative appeal for Federal and Indian leases.
These regulations require the submission of information demonstrating
financial solvency by the person who represents the appellant,
requesting a suspension without the need to provide a surety. For
Federal leases, the RSFA Section 4(l), ``Stay of Payment Obligation
Pending Review,'' requires MMS to evaluate any person, ordered by the
Secretary or a delegated state to pay any obligation (other than an
assessment) subject to RSFA, to determine whether that person is
entitled to a stay of the order without bond or other surety
instrument, pending an administrative or judicial proceeding, based on
the financial solvency of that person. For those appellants who are not
financially solvent or for appeals involving Indian leases, MMS
requires that a surety instrument be posted to secure the financial
interest of the public and Indian lessors during the entire
administrative or judicial appeal process. This information collection
request covers the burden hours associated with appellants submitting
financial statements or surety instruments, subject to annual audit,
required to stay an MMS order.
Minerals produced from Federal and Indian leases vary greatly in
the nature of occurrence, production, and processing methods. When a
company or an individual enters into a lease to explore, develop,
produce, and dispose of minerals from Federal or Indian lands, that
company or individual agrees to pay the lessor a share in an amount or
value of production from the leased lands. The lessee is required to
report various kinds of information to the lessor relative to the
disposition of the leased minerals. Such information is generally
available within the records of the lessee or others involved in
developing, transporting, processing, purchasing, or selling such
minerals. The information collected includes data necessary to ensure
that the royalties are accurately valued and appropriately paid.
Proprietary information submitted to MMS under this collection is
protected, and no items of a sensitive nature are collected. A response
is voluntary and required to obtain the benefit of suspending
compliance of an order pending appeal.
Stay of Payment Pending Appeal
Title 30 CFR 243.1 states that lessees or recipients of MMS
Minerals Revenue Management (MRM) orders may suspend compliance with an
order if they appeal in accordance with 30 CFR Part 290, Subpart B--
Minerals Revenue Management Appeal Procedures. Pending appeal, MMS
suspends the payment requirement if the appellant submits a formal
agreement of payment
[[Page 37483]]
in case of default, such as a bond or other surety, or demonstrates
financial solvency. The MMS accepts the following surety types: Form
MMS-4435, Administrative Appeal Bond; Form MMS-4436, Letter of Credit;
Form MMS-4437, Assignment of Certificate of Deposit; Self-bonding; and
U.S. Treasury Securities.
When one of the surety types is selected and put in place,
appellants must maintain the surety until completion of the appeal. If
the appeal is decided in favor of the appellant, MMS returns the surety
to the appellant. If the appeal is decided in favor of MMS, then MMS
will take action to collect full royalty payment or draw down on the
surety. The MMS draws down on a surety if the appellant fails to comply
with requirements relating to amount due, timeframe, or surety
submission or resubmission. Whenever MMS must draw down on a surety,
MMS must draw down the total amount due, which is defined as unpaid
principal plus the interest accrued to the projected receipt date of
the surety payment. Appellants may refer to the Surety Instrument
Posting Instructions for each of the five surety types to submit the
respective information. These instructions for the five surety types
discussed below can also be found at http://www.mrm.mms.gov/
ReportingServices/PDFDocs/SuretyInst.pdf.
Forms and Other Surety Types
Form MMS-4435, Administrative Appeal Bond
Appellants may file Form MMS-4435, Administrative Appeal Bond,
which MMS uses to secure the financial interests of the public and
Indian lessors during the entire administrative and judicial appeal
process. Under 30 CFR 243.4, appellants are required to submit their
contact and surety amount information on the bond to obtain the benefit
of suspension of an obligation to comply with an order. The bond must
be issued by a qualified surety company that is approved by the
Department of the Treasury (see Department of the Treasury Circular No.
570, revised periodically in the Federal Register). The Associate
Director for MRM (Associate Director) or the MRM-delegated bond-
approving officer (officer) maintains these bonds in a secure facility.
Once the appeal has concluded, MMS may release and return the bond to
the appellant or collect royalty payment on the bond. If collection is
necessary for a remaining royalty payment balance, MMS will issue a
demand for payment to the surety company with a notice to the
appellant. The MMS will also include all interest accrued on the
affected bill.
Form MMS-4436, Letter of Credit
Appellants may choose to file Form MMS-4436, Letter of Credit, with
no modifications. Requirements of 30 CFR 243.4 continue to apply. The
Associate Director or officer maintains the Letter of Credit (LOC) in a
secure facility. A bank must notarize and issue the LOC for appellants
in which the bank has a minimum Fitch rating of ``C'' for an LOC of
less than $1 million, ``B/C'' for an LOC between $1 million and $10
million, or ``B'' for an LOC over $10 million. The LOC must have a
minimum coverage period of 1 year and be automatically renewable for up
to 5 years.
The appellant is responsible for verifying that the bank provides a
current rating to MMS. If the issuing bank's rating falls below the
minimum acceptable level, a satisfactory replacement surety must be
submitted within 14 days, or MMS will draw down the existing LOC. If
the bank issuing the LOC chooses not to renew the existing LOC, it must
provide MMS with a notice of its decision not to renew 30 days prior to
expiration of the LOC. Once the appeal has been concluded, MMS may
release and return the LOC to the appellant or collect royalty payment
on the LOC. If collection is necessary for a remaining royalty payment
balance, MMS will issue a demand for payment, which includes all
interest assessed on the affected bill, to the bank with a notice to
the appellant.
Form MMS-4437, Assignment of Certificate of Deposit
Appellants may choose to secure their debts by requesting to use a
Certificate of Deposit (CD) from their bank and submitting Form MMS-
4437, Assignment of Certificate of Deposit. Requirements of 30 CFR
243.4 continue to apply. Appellants must file the request with MMS
prior to the invoice due date. The MMS will accept a book-entry CD that
explicitly assigns the CD to the Associate Director. A bank must issue
the CD in which the bank has a minimum Fitch rating or is confirmed by
a bank with an acceptable rating. The acceptable ratings for a CD are
the same as for an LOC. If collection of the CD is necessary for a
royalty payment balance, MMS will return unused CD funds to the
appellant after total settlement of the appealed issues, including
applicable interest charges.
Self-Bonding
For Federal oil and gas leases, RSFA Section 4(l), as promulgated
at 30 CFR 243.201, provides that no surety instrument is required when
a person representing the appellant periodically demonstrates, to the
satisfaction of MMS, that guarantor or appellant is financially solvent
or otherwise able to pay the obligation. Appellants must submit a
written request to ``self-bond'' every time a new appeal is filed. To
evaluate the financial solvency and exemption from requirements of
appellants to maintain a surety related to an appeal, MMS requires
appellants to submit a consolidated balance sheet, subject to annual
audit. In some cases, MMS also requires copies of the most recent tax
returns--up to 3 years--filed by appellants.
In addition, appellants must annually submit financial statements,
subject to annual audit, to support their net worth. The MMS uses the
consolidated balance sheet or business information supplied to evaluate
the financial solvency of a lessee, designee, or payor seeking a stay
of payment obligation pending review. If appellants do not have a
consolidated balance sheet documenting their net worth, or if they do
not meet the $300 million net worth requirement, MMS selects a business
information or credit reporting service to provide information
concerning an appellant's financial solvency. We charge the appellant a
$50 fee each time we need to review data from a business information or
credit reporting service. The fee covers our costs in determining an
appellant's financial solvency.
U.S. Treasury Securities
Appellants may choose to secure their debts by requesting to use a
U.S. Treasury Security (TS). Appellants must file the letter of request
with MMS prior to the invoice due date. The TS must be a U.S. Treasury
note or bond with maturity equal to or greater than 1 year. The TS must
equal 120 percent of the appealed amount plus 1 year of estimated
interest (necessary to protect MMS against interest rate fluctuations).
The MMS accepts only a book-entry TS.
Request to OMB
The MMS is requesting OMB's approval to continue to collect this
information. Not collecting this information would limit the
Secretary's ability to discharge his/her duties and may also result in
loss of royalty payments.
Frequency: Annually and on occasion.
Estimated Number and Description of Respondents: 140 Federal/Indian
appellants.
[[Page 37484]]
Estimated Annual Reporting and Recordkeeping ``Hour'' Burden: 140
hours.
The following chart shows the estimated annual burden hours by CFR
section and paragraph. We have not included in our estimates certain
requirements performed in the normal course of business and considered
usual and customary.
Respondents' Estimated Annual Burden Hours
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Annual
Citation 30 CFR 243 Reporting and recordkeeping Hour burden Average number of burden
requirement annual responses hours
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Subpart A--General Provisions
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243.4(a)(1).................... How do I suspend compliance with an 1 hour 75 surety 75
order? instruments
(a) If you timely appeal an order, (including Forms
and if that order or portion of MMS-4435, MMS-
that order: (1) Requires you to 4436, and MMS-
make a payment, and you want to 4437, or TS).
suspend compliance with that order,
you must post a bond or other
surety instrument or demonstrate
financial solvency * * *
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243.6.......................... When must I or another person meet Burden hours covered under Sec.
the bonding or financial solvency 243.4(a)(1).
requirements under this part?
If you must meet the bonding or
financial solvency requirements
under Sec. 243.4(a)(1), or if
another person is meeting your
bonding or financial solvency
requirements, then either you or
the other person must post a bond
or other surety instrument or
demonstrate financial solvency
within 60 days after you receive
the order or the Notice of Order.
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243.7(a)....................... What must a person do when posting a Burden hours covered under Sec.
bond or other surety instrument or 243.4(a)(1).
demonstrating financial solvency on
behalf of an appellant?
If you assume an appellant's
responsibility to post a bond or
other surety instrument or
demonstrate financial solvency * *
* (a) Must notify MMS in writing *
* * that you are assuming the
appellant's responsibility * * *.
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243.8(a)(2) and (b)(2)......... When will MMS suspend my obligation Burden hours covered under Sec.
to comply with an order? 243.4(a)(1).
(a) Federal leases. * * * (2) If the
amount under appeal is $10,000 or
more, MMS will suspend your
obligation to comply with that
order if you:
(i) Submit an MMS-specified surety
instrument under subpart B of this
part within a time period MMS
prescribes; or
(ii) Demonstrate financial solvency
under subpart C.
(b) Indian leases. * * * (2) If the
amount under appeal is $1,000 or
more, MMS will suspend your
obligation to comply with that
order if you submit an MMS-
specified surety instrument under
subpart B of this part within a
time period MMS prescribes.
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Subpart B--Bonding Requirements
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243.101(b)..................... How will MMS determine the amount of Burden hours covered under Sec.
my bond or other surety instrument? 243.4(a)(1).
* * * (b) If your appeal is not
decided within 1 year from the
filing date, you must increase the
surety amount to cover additional
estimated interest for another 1-
year period. You must continue to
do this annually * * *.
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Subpart C--Financial Solvency Requirements
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243.200(a) and (b)............. How do I demonstrate financial 1 hour 65 self-bonding 65
solvency? submissions
(a) To demonstrate financial (demonstration of
solvency under this part, you must financial
submit an audited consolidated solvency).
balance sheet, and, if requested by
the MMS bond-approving officer, up
to 3 years of tax returns to the
MMS, * * *.
(b) You must submit an audited
consolidated balance sheet
annually, and, if requested,
additional annual tax returns on
the date MMS first determined that
you demonstrated financial solvency
as long as you have active appeals,
or whenever MMS requests. * * *
[[Page 37485]]
243.201(c)(1), (c)(2)(i) and How will MMS determine if I am Burden hours covered under Sec. Sec.
(c)(2)(ii) and 243.201(d)(2). financially solvent? 243.4(a)(1) and 243.200(a) and (b).
* * * (c) If your net worth, minus
the amount we would require as
surety under subpart B for all
orders you have appealed is less
than $300 million, you must submit
* * *:
(1) A written request asking us to
consult a business-information, or
credit-reporting service or program
to determine your financial
solvency; and
(2) A nonrefundable $50 processing
fee:
(i) You must pay the processing fee
* * *;
(ii) You must submit the fee with
your request * * * and then
annually on the date we first
determined that you demonstrated
financial solvency, as long as you
are not able to demonstrate
financial solvency * * * and you
have active appeals.
(d) * * * (2) For us to consider you
financially solvent, the business-
information or credit-reporting
service or program must demonstrate
your degree of risk as low to
moderate: * * *
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243.202(c)..................... When will MMS monitor my financial Burden hours covered under Sec.
solvency? 243.4(a)(1).
* * * (c) If our bond-approving
officer determines that you are no
longer financially solvent, you
must post a bond or other MMS-
specified surety instrument under
subpart B.
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Total Burden.................................................................. 140 140
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Estimated Annual Reporting and Recordkeeping ``Non-hour'' Cost
Burden: There are no additional recordkeeping costs associated with
this information collection. However, MMS estimates 15 appellants will
pay MMS a $50 fee to obtain credit data from a business information or
credit reporting service as a ``non-hour'' cost burden over the next
three years, or 5 appellants per year, for a total of $250 per year (5
appellants per year x $50 = $250).
Public Disclosure Statement: The PRA (44 U.S.C. 3501 et seq.)
provides that an agency may not conduct or sponsor, and a person is not
required to respond to, a collection of information unless it displays
a currently valid OMB control number.
Comments: Before submitting an ICR to OMB, PRA section
3506(c)(2)(A) requires each agency ``* * * to provide notice * * * and
otherwise consult with members of the public and affected agencies
concerning each proposed collection of information * * *.'' Agencies
must specifically solicit comments to: (a) Evaluate whether the
proposed collection of information is necessary for the agency to
perform its duties, including whether the information is useful; (b)
evaluate the accuracy of the agency's estimate of the burden of the
proposed collection of information; (c) enhance the quality,
usefulness, and clarity of the information to be collected; and (d)
minimize the burden on the respondents, including the use of automated
collection techniques or other forms of information technology.
To comply with the public consultation process, we published a
notice in the Federal Register on August 13, 2007 (72 FR 45264),
announcing that we would submit this ICR to OMB for approval. The
notice provided the required 60-day comment period. We received no
comments in response to the notice.
If you wish to comment in response to this notice, you may send
your comments to the offices listed under the ADDRESSES section of this
notice. The OMB has up to 60 days to approve or disapprove the
information collection but may respond after 30 days. Therefore, to
ensure maximum consideration, OMB should receive public comments by
July 31, 2008.
Public Comment Policy: We will post all comments in response to
this notice on our Web site at http://www.mrm.mms.gov/Laws_R_D/
InfoColl/InfoColCom.htm. We will also make copies of the comments
available for public review, including names and addresses of
respondents, during regular business hours at our offices in Lakewood,
Colorado. Before including your address, phone number, e-mail address,
or other personal identifying information in your comment, you should
be aware that your entire comment--including your personal identifying
information--may be made publicly available at any time. While you can
ask us in your comment to withhold your personal identifying
information from public view, we cannot guarantee that we will be able
to do so.
MMS Information Collection Clearance Officer: Arlene Bajusz (202)
208-7744.
Date April 24, 2008.
Richard J. Adamski,
Acting Associate Director for Minerals Revenue Management.
[FR Doc. E8-14894 Filed 6-30-08; 8:45 am]
BILLING CODE 4310-MR-P