Inflation-Based Adjustments in Federal Civil Monetary Penalties

This Article will examine the Federal Civil Penalties Inflation Adjustment Act in detail. A 2003 report by the United States General Accounting Office identified the difficulties that federal agencies had encountered in their implementation of the Inflation Adjustment Act. This Article extends the analysis offered by the 2003 GAO report in multiple ways. This Article comprehensively reviews the legislative history of the Act so that it can explain the Act’s economic problems as the consequence of Congress’s extensive but ultimately flawed drafting process. Through its Mathematical Appendix and its more contextualized illustrations, this Article supplies both formal and narrative explanations of the Act’s shortcomings. This Article ultimately proposes concrete legislative solutions to each of the statutory flaws that it identifies.

Justin Smith Morrill Chair in Law, Michigan State University; Of Counsel, Technology Law Group of Washington, D.C. This article is based on research that I conducted on behalf of the Administrative Conference of the United States (ACUS), which led to the adoption of Recommendation 2012-8 by ACUS on December 7, 2012. See Admin. Conference of the U.S., Recommendation 2012-8, 78 Fed. Reg. 2929, 2943-45 (Jan. 15, 2013). That recommendation, my original report, and other materials are available at https://www.acus.gov/research-projects/inflation-adjustment-civil-penalties. I thank Christian Diego Alcocer Argüello, Mathew Bisanz, Jennifer Hendricks, and L. Joseph Tackett for very capable research assistance. Curtis Copeland, David Pritzker, and Stephanie Tatham provided very helpful commentary. Special thanks to Heather Elaine Worland Chen.