Rules of Practice for Federally Assisted Airport Proceedings; Proposed Rule DEPARTMENT OF TRANSPORTATION

SUMMARY: This NPRM proposes to establish rules of practice for the

filing of complaints and adjudication of compliance matters involving

Federally assisted airports. The proposed rule would address

exclusively airport compliance matters arising under the Airport and

Airway Improvement Act (AAIA) of 1982, as amended; certain airport-

related provisions of the Federal Aviation Act of 1958, as amended; the

Surplus Property Act; as amended; predecessors to those acts; and

regulations, grant agreements, and documents of conveyance issued or

made under those acts. The proposed rule is intended to expedite

substantially the handling and disposition of airport-related

complaints, and to provide an efficient process for the agency to

resolve disputes between air carriers and airport proprietors regarding

whether airport fees and charges comply with Federal requirements. The

NPRM would also amend the FAA's existing complaint and adjudication

procedures, 14 CFR Part 13, ``Investigative and Enforcement

Procedures,'' to remove from the coverage of part 13 the airport-

related matters that would be handled under the new part 16.

DATES: Comments must be received on or before August 8, 1994.

ADDRESSES: Comments on this notice may be mailed, in duplicate, to:

Federal Aviation Administration, Office of the Chief Counsel, Attn.:

Rules Docket (AGC-10), Docket No. 27783, 800 Independence Avenue, SW.,

Washington, DC 20591. Comments delivered must be marked Docket No.

27783. Comments may be examined in room 915F weekdays between 8:30 a.m.

and 5 p.m. except on Federal holidays.

FOR FURTHER INFORMATION CONTACT:

Barry Molar, Airport Law Branch (AGC-610), Office of the Chief Counsel,

(202) 267-3473, Federal Aviation Administration, 800 Independence

Avenue, SW., Washington, DC 20591.

SUPPLEMENTARY INFORMATION:

Comments Invited

Interested persons are invited to participate in the making of the

proposed rule by submitting such written data, views, or arguments as

they desire. Comments relating to the economic effects that might

result from adoption of the proposals contained in this notice are

invited. Communications should identify the regulatory docket or notice

number and be submitted in duplicate to the address listed above.

Commenters wishing the FAA to acknowledge receipt of their comments on

this notice must submit with those comments a self-addressed, stamped

postcard on which the following statement is made: ``Comments to Docket

No. 27783.'' The postcard will be dated and time stamped and returned

to the commenter.

All communications received on or before the closing date for

comments will be considered by the Administrator before taking action

on the proposed rule. The proposal contained in the notice may be

changed in light of comments received. All comments submitted will be

available, both before and after the closing date for comments, in the

Rules Docket for examination by interested persons. A report

summarizing each substantive public contact with DOT/FAA personnel

concerning this rulemaking will be filed in the docket.

Availability of NPRM

Any person may obtain a copy of this NPRM by submitting a request

to the Federal Aviation Administration, Office of Public Affairs,

Attention: Public Inquiry Center, APA-430, 800 Independence Avenue SW.,

Washington, DC 20591, or by calling (202) 267-3464. Requests must

identify the notice number of this NPRM. Persons interested in being

placed on the mailing list for future NPRM's also should request a copy

of Advisory Circular No. 11-2A, Notice of Proposed Rulemaking

Distribution System, which describes application procedures.

Background

In addition to its plenary responsibility for aviation safety, the

Federal Aviation Administration (FAA) is responsible for administering

Federal laws that impose certain economic requirements on the operation

of airports in the National Aviation System. These laws include the

Airport and Airway Improvement Act of 1982, as amended, (AAIA) which

provides for Federal grants to airport sponsors and imposes conditions

on the grants in the form of assurances by those sponsors; the Surplus

Property Act, which provides for the transfer of Federal property to

local governments for airport use and, like the AAIA, requires specific

assurances from the sponsor for the use of the property; section 308(a)

of the Federal Aviation Act of 1958, as amended (FAAct), which

prohibits an airport operator from granting an exclusive operating

right at an airport that has received Federal funds; and the Anti-Head

Tax Act, section 1113(a)-(d) of the FAAct, which prohibits local taxes

on air travel but expressly permits the imposition of reasonable fees.

The FAA, concurrently with the publication of this NPRM, has

published for public comment a notice of proposed policy on the

standards for determining whether airport rates and charges are ``fair

and reasonable'' within the meaning of the above statutes. The FAA will

refer to that policy statement, as revised after review of the comments

received, in the implementation of these laws and in adjudicating

complaints brought before the agency involving airport rates and

charges.

The Secretary of Transportation and the FAA Administrator have the

authority and responsibility to receive complaints and adjudicate

matters of compliance with these statutes. Typically, complaints

received by the FAA involve an allegation of economic discrimination

toward an airport tenant or a claim that an exclusive right has been

granted by the airport operator. However, two recent disputes between

airlines serving a major airport and the airport operator indicate that

the FAA may soon receive cases involving more complex rates and charges

issues. In both cases, the airlines filed suit in court but did not

file an administrative complaint with the FAA. In Northwest Airlines,

Inc., et al. v. County of Kent, Michigan, the airline tenants at the

Grand Rapids Airport challenged various aspects of a new rate structure

at the airport. The Supreme Court issued a decision substantially in

favor of the airport operator in January 1994. ________ U.S. ________,

62 U.S.L.W. 4103 (1994). In 1993, the Air Transport Association and

tenant airlines at Los Angeles International Airport filed suit in U.S.

District Court to challenge a substantial increase in landing fees at

the airport. The District Court for the Central District of California

dismissed the airline complaint in February 1994, citing among other

things the lack of a private right of action for complaints under the

Anti-Head Tax Act.

Even though no administrative complaint was filed in the Los

Angeles case, the Department of Transportation became involved after

the City announced that airlines that did not pay the new fees would be

barred from operation at the airport. In November 1993, Secretary of

Transportation Federico Pena convened the parties to the dispute in

Washington, DC, to assist in a settlement of the controversy. The

product of the ensuing discussions was an agreement by the parties that

permitted continued litigation of the issues without the threat of

interruption of air service to the traveling public.

Shortly after the Los Angeles discussions, Secretary Pena issued a

letter, dated December 10, 1993, outlining the Department's prospective

policy on involvement in airport-airline fee disputes. The Secretary

noted the significant potential impact on air travelers and on the

national air transportation system of unresolved airport-airline

disputes. While reaffirming the Department's historic reliance on good

faith negotiations and agreement by the local parties, the Secretary

announced a more active and engaged approach to disputes that could not

be resolved at the local level. The letter included the Secretary's

direction to the FAA to streamline the procedural rules for handling

airport-airline fee disputes. In keeping with the approach announced by

the Secretary, and the expressed need for a more effective, streamlined

enforcement and adjudication procedure, the FAA proposes the adoption

of a revised and updated procedural rule adapted specifically to the

investigation and adjudication of airport-related complaints within the

jurisdiction of the FAA.

Existing FAR Part 13

At present, enforcement of the requirements imposed on airport

proprietors as a condition of the acceptance of Federal grant funds or

property is accomplished through the administrative procedures set

forth in 14 CFR part 13. Requirements include, without limitation: (a)

The obligation to provide access to the airport on fair and reasonable

terms without unjust discrimination; (b) the prohibition on grants of

exclusive rights; (c) the obligation to use all airport revenue on

capital or operating costs of the airport, the sponsor's airport system

or other transportation projects directly related to air

transportation, consistent with 49 U.S.C. App. 2210(a)(12); (d) the

obligation to make the airport as self-sustaining as possible; (e) the

obligation to ensure that, to the maximum extent practicable, at least

10 percent of concession businesses are small business concerns owned

and operated by socially and economically disadvantaged businesses

(DBE's); and (f) the obligations pursuant to section 505(d) of the AAIA

that at least 10 percent of AIP funds shall be expended with DBE's.

The application of part 13 procedures to enforcement of airport

grant agreements began in 1979, largely as the result of the enactment

of a civil rights statute, Section 30 of the Airport and Airway

Development Act, as amended (ADAP). Section 30, reenacted as section

520 in the AAIA, as amended, is similar to Title VI of the Civil Rights

Act (CRA), but is not an amendment to the CRA. For this reason, the

Title VI administrative process provided in 49 CFR part 21 does not

cover section 520 cases, and it was necessary to provide another avenue

of administrative process for compliance matters.

Accordingly, the FAA added ADAP to the list of statutes in part 13

under which the Administrator conducts investigations. In 1988, the FAA

amended the applicability provisions of part 13 to refer to the Airport

and Airway Improvement Act of 1982 (AAIA) and to the Airport and Airway

Safety and Capacity Expansion Act of 1987.

While the scope of part 13 was thereby enlarged to accommodate a

range of airport enforcement matters, no attempt was made to revise the

complaint or hearing procedures to address the particular requirements

of airport cases. In the late 1980's, the number and complexity of

complaints from aeronautical users regarding airport sponsor compliance

with grant assurances and other Federal obligations began to increase.

In 1987, an amendment to the AAIA compressed the time available to the

agency to reach a final decision in a case in which grant funds could

be withheld. In effect, section 519 of the AAIA, as amended in 1987,

prohibits the Secretary from denying a grant of entitlement funds or

from withholding payments under a grant for more than 180 days without

providing opportunity for a hearing and issuing a determination of a

violation. Using the complex formal hearing procedures of subpart D of

part 13, it would be practically impossible to meet the 180-day

deadline in the statute for completion of the entire hearing and final

decision process. The difficulty of meeting the 180-day deadline arises

from a number of characteristics of part 13:

There are no explicit deadlines for completion of the

investigative phase of a complaint.

There is no guidance or direction on the processing of

complaints that are treated as reports of violations under Sec. 13.1.

The absence of procedures for processing such cases has led to delays

in disposition of cases, confusion as to the status of regional

determinations under Sec. 13.1 as judicially appealable final agency

orders, and confusion over the procedures and standards for obtaining

FAA headquarters review of regional determinations under Sec. 13.1.

The lack of more streamline adjudicatory procedures has tended

to encourage the practice of submitting out-of-channel appeals and

pleas for action directly to the Administrator and Secretary of

Transportation. The submission of these requests diverts agency

resources from investigations and leads to confusion regarding the

contents of the administrative record.

Some elements of part 13 today do not facilitate an expedited

and definitive finding on compliance. For example, multiple,

potentially duplicative an drawn-out hearings and the current

administrative review process for hearing officer's decisions under

subpart D make timely decisionmaking exceedingly difficult.

FAA experience with part 13 indicates that some provisions

permit parties to prolong litigation once the FAA has initiated formal

proceedings. Subpart D of part 13 includes, for example, open-ended

subpoena provisions, and permits discovery and motions practice without

time limit if the hearing officer chooses to allow it. Also, part 13

places no clear limits upon the successive filing of dispositive

motions under Sec. 13.49 by all parties.

Part 13, in short, does not provide a structure that regularly

facilitates the final administrative disposition of airports-related

cases within prescribed time limits, and cannot be relied upon to

afford expedited resolution of disputes that may be needed in major

airline-airport cases. For these purposes, and consistent with the

Secretary's direction for a more streamlined process, a new procedural

rule is necessary to focus exclusively on airport matters; to avoid

duplicative and unnecessary steps; and to offer expeditious treatment,

especially in cases with substantial potential impact on air

transportation. In support of these objectives, the rules proposed here

would:

1. Require parties to undertake serious attempts at informal

resolution of their dispute prior to the filing of a complaint.

2. Focus administrative resources as a priority on resolving

complaints which, if not expeditiously resolved, may result in

substantial adverse impact on air transportation.

3. Provide for a single complaint procedure, rather than for formal

and ``informal'' complaints as in part 13. This will avoid duplicate

complaints and investigations on the same subject.

4. Limit ``standing'' to persons directly and substantially

affected by the specific dispute at issue, i.e. persons with a

substantial actual and present interest in the outcome of an issue that

is ripe for decision. Part 16 could not be used to obtain advisory

opinions on speculative actions or academic questions.

5. Set clear time limits on the actions of all parties, including

the agency, from the time a complaint is filed through final agency

decision.

6. Provide procedural flexibility, e.g., to shorten time limits and

eliminate procedural steps in a particular proceeding, consistent with

fairness to those affected, where circumstances require special

expedition.

7. Promote the likelihood of informal resolution of cases by the

affected air carrier and airport parties without expensive formal

hearings, by rendering a public initial agency determination of

compliance in a short time frame.

8. Limit the number of formal pleadings and require that the

documentary evidence relied upon by the parties be submitted promptly

with the pleadings.

9. Require that parties serve all pleadings and documents on each

other and the FAA, and use overnight or hand-delivery when the need for

expeditious resolution of the matter is particularly acute.

10. Provide for an expedited process for investigatory hearings

that will provide a full record, without undue complexity, regarding

proposed increases in airport rates and charges in cases of particular

significance.

11. Provide hearing procedures that permit the scope of each

hearing to be tailored to the complexity and circumstances of the

particular case, and rely on briefing and oral argument where there are

no genuine issues of material fact in dispute.

12. Clearly establish the burden that each party must carry to make

its case.

13. Limit amicus participation to the filing of briefs.

14. Prohibit interlocutory appeals and requests for

reconsideration, and focus instead on an effective appeals process.

Subparts A through I of the proposed rule set forth a comprehensive

procedure for the filing, investigation, and adjudication of complaints

filed with the FAA against airports, and for appeal of agency decisions

regarding such complaints. Subpart J of the proposed rule includes a

special procedure for the receipt and investigation of complaints by

airlines against an airport alleging that an airport fee increase is

unreasonable or unjustly discriminatory.

The normal complaint procedure would result in an initial

determination by the agency, within approximately six months of the

filing of a complaint, whether the airport was in violation of its

Federal obligations. This time period would include two round of

responsive pleadings by the complainant and respondent, and a

reasonably expeditious investigation and preparation of decision by the

FAA.

The special subpart J procedure would result in an initial

determination within 120 days of the complaint. Typically, this

determination would be whether the challenged rate was fair and

reasonable within the meaning of the relevant statutes. Under subpart

J, the agency would appoint a presiding officer who will act

independently to conduct an expedited investigatory hearing on the

complaint. The presiding officer would then prepare a report of

investigation for transmittal to the Assistant Administrator for

Airports, who would consider the hearing record and report in issuing

the initial determination of compliance.

Both the investigatory hearing under subpart J and the adjudicatory

hearing under subpart F would provide an open and fair process for

efficient and expedited consideration of complaints involving Federally

funded airports. In both procedures, the time allowed for issuance of a

compliance decision represents a considered balance between the

interest in expedited resolution of disputes and the need for adequate

time for investigation and deliberation before issuing agency decisions

in these potentially complex cases. In subpart J, for example, the

relatively short time provided for an interim determination on a

complaint is sufficient to allow for oral investigatory hearing.

Within the constraints imposed by the effort achieve expedition,

the investigatory hearing would provide complainants and airports the

opportunity to develop the record before the FAA through streamlined

procedures that permit cross-examination, adversary process, and

limited discovery. In the atypical case in which an adjudicatory

hearing would be held (under section 519 of the AAIA or section 1002 of

the FAAct), the proposed hearing procedures are intended to permit the

FAA to complete compliance hearings within 180 days, while assuring

that a sponsor receives a fair hearing and opportunity to present

evidence and argument to support its position. That process would

provide substantial procedural safeguards, although it would not

conform in every respect to the provisions of the Administrative

Procedure Act (APA). The hearings mandated by section 519 of the AAIA

and section 1002 of the FAAct are not an ``agency adjudication required

by statute to be determined on the record after opportunity for an

agency hearing'' within the meaning of section 554 of the APA.

Accordingly, provisions of section 554 of the APA do not apply to the

adjudicatory hearing proposed in this rule.

Description of the Proposed Rule

Subpart A--General Provisions

Subpart A would include provisions of general applicability to

proceedings brought under part 16, definitions of terms used in the

regulation, and a provision on separation of functions.

The regulation would apply to complaints, investigations and

adjudications regarding compliance by airports with the following:

(a) Sections 308 and 1113 of the Federal Aviation Act of 1958, as

amended, 49 U.S.C. App. 1347 and 1513;

(b) Obligations contained in grant-in-aid agreements (grant

assurances) issued under airport financial assistance legislation

enacted over the years, and obligations directly imposed by that

legislation (including obligations relating to use of disadvantaged

business enterprises); and

(c) Obligations contained in deeds of transfer for property

transferred from the United States to airport proprietors (proposed

section 16.1(a)).

The proposed regulation would also specify that if a grant

assurance concerns a requirement that is within the authority of

another Federal agency, that agency's administrative processes should

be used and that the FAA would defer to the other Federal agency's

authority (proposed Sec. 16.1(b)). For example, the grant assurances

require compliance with the Davis-Bacon Act relating to the payment of

union-scale wages on Federally funded construction projects.

Allegations of violation of the Davis-Bacon Act would continue to be

adjudicated by the Department of Labor, not by the FAA under proposed

part 16.

The proposed definitions (proposed section 16.3) are for the most

part derived from the definitions of like or similar terms in 14 CFR

part 13. The proposed definition of agency attorney would specify the

FAA attorneys who can be responsible for investigating and prosecuting

complaints. To assure compliance with the proposed rules on separation

of functions in cases that go on to hearings under proposed subpart F,

attorneys holding certain positions and working in certain offices of

the FAA would be precluded from functioning as agency attorneys at any

stage of the proceedings. Such attorneys would be available to advise

the FAA decisionmaker or to serve as a hearing officer.

The proposed definition of hearing officer would require the

hearing officer to be an attorney. FAA attorneys holding certain

positions and working in specific offices would be precluded from

functioning as hearing officers to assure compliance with the proposed

rule on separation of functions.

Proposed Sec. 16.5, requiring the separation of prosecutorial and

adjudicatory functions in hearings, is based on FAR Sec. 13.203,

relating to civil penalty adjudications. Separation of functions is not

required by statute because hearings under part 16 would not be subject

to APA hearing requirements; however, the separation is provided to

promote confidence in the impartiality and integrity of decisions under

the new procedures. Separation of prosecutorial and adjudicatory

functions would be provided from the time of the issuance of an initial

determination in all cases in which an opportunity for hearing is

provided, including cases in which the respondent waives hearing and

appeals the initial determination in writing to the Administrator. When

separation applies, the Assistant Administrator for Airports would be

considered as performing the investigatory and prosecutorial function

and would not participate in the decision of the Administrator or

hearing officer.

Subpart B--General Rules Applicable to Complaints, Proceedings, and

Appeals Initiated by the FAA

This subpart would apply to all phases of the investigations and

adjudications under this part.

Proposed Sec. 16.11 would provide for expediting any portion of an

investigation or adjudication. While the normal procedures in this

proposal are designed to be completed efficiently, in some

circumstances there is a need to resolve an issue even more quickly.

The section would authorize the Assistant Administrator for Airports to

take a variety of steps appropriate to the particulars of any given

case. The section is intended to provide flexibility to adopt such

special procedures to assure sufficiently rapid decisionmaking and

procedural fairness in the circumstances of the individual case.

The proposed rules on filing and service of documents, computation

of time, and motions (proposed Secs. 16.13, 16.15, 16.17, and 16.19),

are based on similar provisions in the Federal Rules of Civil

Procedure, the Department's Rules of Practice in Proceedings (14 CFR

part 302), the Rules of Practice in Civil Penalty Actions (14 CFR part

13 subpart G), and the National Transportation Safety Board's Rules of

Practice in Air Safety Proceedings (49 CFR part 821). These rules have

been used for many years, are well-know to the aviation bar, and have

proven to be effective.

Subpart C--Special Rules Applicable to Complaints.

Under proposed Sec. 16.21, a potential complainant, i.e., a person

directly affected by the alleged noncompliance, would be required to

engage in good faith efforts to resolve the disputed matter informally

with potentially responsible respondents before filing a complaint with

the FAA under part 16. Informal resolution may include mediation,

arbitration, use of a dispute resolution board, or other form of third-

party assistance. The Department's preference for informal resolution

in lieu of formal complaint to the FAA is clearly stated in the notice

of proposed policy statement published concurrently with this proposed

rule.

Under this section, it would be necessary for the potential

complainant or his representative to certify that good faith efforts

had been made to achieve informal resolution. To protect the parties,

and for consistency with Rule 408 of the Federal Rules of Evidence, the

certification would not include information on monetary or other

settlement offers made but not agreed upon in writing.

Section 16.23 Complaints, Answers, and Other Documents

Section 16.23 would specify the information to be included in a

complaint, the additional pleadings allowed and the information to be

contained therein, and the method for filing a motion to dismiss. In

addition, it would shift to the complainant and the respondent the

burden of providing all available supporting documents on which they

rely and serving them upon all parties as specified in Sec. 16.15.

Finally, it would provide that the FAA will have 20 days to docket

and review the complaint. In the event that the complaint is not

dismissed, the FAA will notify both the complainant and named

respondent in writing within 20 days after the complaint is received

that an answer shall be filed within 20 days of the date of service of

the notification. The complainant's reply is due within 15 days of the

answer, and the respondent's rebuttal, if any, is due within 15 days of

the reply.

Section 16.25 Dismissals

Complaints 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.

Section 16.27 Incomplete Complaints

Section 16.27 deals with a second category of complaint--one which

states a prima facie cause of action and falls within the jurisdiction

of the Administrator but is deficient as to one or more of the filing

requirements set forth in Sec. 16.23(b). Incomplete complaints would be

dismissed within 20 days after the receipt of the complaint, without

prejudice. Since the complainant would be able to refile, this

dismissal would not be appealable to the FAA decision-maker or to a

United States Court of Appeals.

Section 16.29 Investigations

Under Sec. 16.29, where the FAA finds reasonable grounds to

investigate the matters described in a complaint, it would conduct an

investigation. Where there is little dispute about factual matters, or

where documentary submissions alone are deemed sufficient to make a

record for decision, the investigation may consist entirely of a review

of the arguments and materials submitted by the parties in pleadings,

i.e., the complaint, answer, reply, and rebuttal. The FAA may rely on

this review for its initial determination on compliance. Because the

FAA could rely exclusively on information and documentary evidence

filed with the pleadings, parties would be expected to provide thorough

submissions in order to protect their interests.

Alternatively, the FAA could supplement the submissions by

requesting additional information from a party or by field

investigation if appropriate. Further, if necessary information is not

furnished voluntarily, the FAA could use its authority under the FAAct

and the AAIA to subpoena witnesses for deposition and production of

documents. By permitting the FAA to render its initial determination

based on the pleadings and material submitted therein, this section in

effect permits the grant of initial summary judgment.

Section 16.31 Initial Determinations After Investigations

Section 16.31 provides procedures for issuance of the FAA's initial

determinations and orders, and for issuance of the final decision on

appeal of the initial determination in cases that do not involve a

hearing. The Assistant Administrator for Airports, or a designee, would

issue an initial determination in every case in which the FAA

investigates a complaint. The agency would be required to issue an

initial determination in 120 days from the due date of the last

pleading (i.e., reply or rebuttal), but the date could be extended for

up to 60 days for good cause, or due to delay caused by the

complainant. If there is no appeal of the initial determination, it

would become the final decision of the Administrator. If a party

adversely affected by the initial determination does not file an

administrative appeal, the FAA proposes that the final decision would

not be judicially reviewable.

The initial determination is intended to provide a prompt and

authoritative indication of the agency position on a complaint.

Consistent with the view that local parties are best positioned to

resolve disputes, the initial determination should provide guidance to

airport proprietors and airport users in resolving the matter without

further process. While the initial determination can be appealed, the

FAA expects that in many instances the initial decision would resolve

the issues raised in the complaint to the satisfaction of the parties.

In such cases, the parties may find it more beneficial to negotiate a

solution based on the FAA's initial position than to continue to

litigate the matter.

Section 16.33 Final Decision Without Hearing

If the initial determination finds the sponsor in compliance and

dismisses the complaint, the complainant could appeal the determination

by a written appeal to the Administrator within 30 days. Reply briefs

could be filed within 20 days, and the Administrator would be required

to issue a final agency decision on appeal within 30 days of the due

date for the reply briefs. The FAA would not provide opportunity for a

hearing on the dismissal of a complaint.

If the initial determination contains a finding of noncompliance

and the respondent is entitled to a hearing, the determination would

provide the sponsor the opportunity elect an oral evidentiary hearing

under subpart F. The procedure for electing or waiving a hearing is set

forth in Subpart E. If the respondent waives hearing and instead elects

to file a written appeal to the Administrator, a final decision would

be issued by the Administrator or a designee under Sec. 16.33.

Subpart D--Special Rules Applicable to Proceedings Initiated by the FAA

Section 16.101 would make clear the FAA's continuing authority to

initiate its own investigation of any matter within the applicability

of this part without having received a complaint, as authorized by

section 313 and section 1002 of the Federal Aviation Act and section

519 of the Airport and Airway Improvement Act.

Section 16.103 serves three purposes: (1) To require a notice

setting forth the specific areas of concern to the FAA, following the

initiation of an investigation; (2) to establish the time limit for a

response; and (3) to encourage and provide time for informal

resolution. In the event the issues raised are not resolved informally,

the FAA could proceed to issue an initial determination under

Sec. 16.31.

Subpart E--Proposed Orders of Compliance

Subpart E is similar to Sec. 13.20 of part 13, but provides a more

streamlined and expedited procedure for the sponsor to elect to

exercise the option of requesting a hearing, in keeping with the

purpose of proposed part 16. If the initial determination proposes a

sanction against the sponsor subject to section 519(b) of the AAIA or

section 1002 of the FAAct, the respondent could file a request for

hearing within 30 days after service of the determination. If the

respondent elects a hearing, the agency will issue a hearing order.

Alternatively, if the respondent waives hearing and instead files a

written appeal (within 30 days), the Administrator would issue a final

decision in accordance with the procedures set forth in Sec. 16.33.

During the 30-day period before an election of hearing or written

appeal is due, the respondent and complainant would be encouraged to

negotiate a resolution of the dispute based on the initial

determination.

If the respondent fails to respond, the initial determination

becomes final.

Subpart F--Hearings

Proposed subpart F would state the procedures for initiating and

conducting adjudicative hearings. The hearing order, issued by the

Deputy Chief Counsel under proposed Sec. 16.201, would set the scope of

the hearing by identifying the issues to be resolved, as well as

assigning the hearing officer.

If no material facts that require oral examination of witnesses are

in dispute, the hearing could be limited to submission of briefs and

oral argument. If the hearing follows an investigatory hearing under

subpart J, the record from the subpart J proceeding would be made part

of the adjudicative hearing record, and the hearing officer could limit

the submission of evidence to avoid duplication of the prior

proceeding.

In the hearing, the agency attorney would represent the agency's

position before the hearing officer, and would have the same status as

any other representative of a party.

The proposed rules include commonly used adjudicatory procedures

such as representation of the parties by attorneys, intervention,

participation by non-parties, pretrial procedures and discovery, the

availability of compulsory process to obtain evidence, and procedures

for use at the hearing. They are based on similar provisions in the

Federal Rules of Civil Procedure, the Department's Rules of Practice in

Proceedings (14 CFR Part 302), the Rules of Practice in Civil Penalty

Actions (14 CFR part 13 subpart G), and the National Transportation

Safety Board's Rules of Practice in Air Safety Proceedings (49 CFR part

821). These provisions are intended to provide the parties with a

reasonable opportunity to prepare their cases, while allowing the

process to be completed expeditiously.

Subpart G--Initial Decisions, Orders and Appeals

Proposed subpart G provides procedures for issuance of initial

decisions and orders by hearing officers, appeals of the initial

decision to the FAA decisionmaker and for the issuance of consent

orders. Proposed Sec. 16.241 governing initial decisions and

administrative appeals is based on 14 CFR 13.20(g)-(i). However,

shorter time periods are provided to accommodate the time limits of

section 519 of the AAIA. In addition, the proposed rule would include a

provision for sua sponte review of an initial decision by the FAA

decisionmaker, consistent with the practice under 14 CFR 302.28(d).

Proposed Sec. 16.243 governing disposal of cases by consent orders

is derived from 14 CFR 13.13.

Subpart H--Judicial Review

Proposed Subpart H would contain rules applicable to judicial

review of final agency orders. Proposed Sec. 16.247(a) would set forth

the basic authority to seek judicial review. The provision is based on

14 CFR 13.235. Specific reference to section 519(b)(4) of the AAIA has

been added. Proposed Sec. 16.247(b) would identify FAA decisions and

actions under part 16 that the FAA does not consider to be judicially

reviewable final agency orders.

Subpart I--Ex Parte Communications

The proposed rule on ex parte communications is based on subpart J

of the Rules of Practice in Air Safety Proceedings of the NTSB, 49 CFR

Part 821, subpart J.

Subpart J--Alternate Procedure for Certain Complaints Concerning

Airport Rates and Charges

Proposed subpart J would provide a special procedure for the

expedited resolution of certain significant disputes involving the fees

that airport operators charge airlines. The procedure would involve a

formal investigation, including an evidentiary investigative hearing.

The concept of the investigatory hearing derives from subpart F of part

13. However, special provisions governing the conduct of discovery,

hearing, and initial determination in the subpart J proceeding are

intended to assure that the investigative process can be completed

within the time frame provided in the rule. If the conditions for the

use of subpart J are met, the airline filing the complaint could

request either the subpart J procedure or the investigatory procedures

under Sec. 16.29.

Proposed Sec. 16.401 sets forth the conditions necessary to request

the special procedure. A subpart J proceeding would be available only

to carriers holding authority under sections 401, 402, or 418 of the

FAAct or operating under an exemption for scheduled service under 14

CFR part 298.

A complaint requesting subpart J procedures would have to meet the

general requirements of Part 16 and the complainant would have to

request the use of subpart J procedures. In addition, subpart J would

only be available for a complaint alleging that an increase in an

airport rate or charge is unreasonable or unjustly discriminatory. The

request would be granted if the Assistant Administrator for Airports

determines that the complaint involves an issue that if not resolved in

an expedited manner could have a significant adverse impact on air

transportation. The FAA also proposes that subpart J could be used when

the Assistant Administrator for Airports determines that a complaint

raises a significant policy issue, without regard to the significance

of the potential impacts of the case.

The subpart J proceeding would be more than usually resource-

intensive for the agency, because of the expedited schedule and the

formal investigatory hearing. The limitation of complainants under

subpart J to scheduled air carriers and the limitation of the subject

matter to significant disputes over airport fees is intended,

therefore, to limit use of agency resources for an expedited hearing

procedure to those cases that have the greatest potential effect on the

traveling public.

Section 16.403 would establish requirements for the filing of

complaints and would establish procedures for ruling on the request for

use of subpart J procedures. The Administrator would rule on the

request for use of subpart J procedures within seven days. If the

complaint did not meet the requirements for use of subpart J but

otherwise satisfied part 16, the complaint would be processed under

subparts B and C exclusively.

If the Assistant Administrator for Airports determined to employ

subpart J procedures, the respondents would be required to file an

answer within 21 days of the Administrator's notice.

Under Sec. 16.405, the Assistant Administrator for Airports would

issue a notice and order of investigation within seven days after the

answer is served. The notice and order of investigation would identify

the presiding officer for the investigation, the allegations and scope

of investigation and the date by which the presiding officer is

directed to issue a report of investigation. The report will generally

be due 60 days after the answer was filed. Under Sec. 16.407, the

presiding officer may not be an agency attorney, as defined in subpart

A, or a person otherwise involved in the investigation of airport

compliance matters. Accordingly, while the presiding officer could be

an FAA or other DOT attorney, or another FAA employee with experience

relevant to the issue, the presiding officer would not be a person with

any prior involvement in the case at hand or a person whose regular

duties involved enforcement of airport compliance.

Proposed Sec. 16.411 sets forth procedures for a subpart J

investigation, including an expedited investigatory hearing. The

procedures are derived from existing part 13 and the hearing procedures

in proposed part 16, subpart F.

Proposed Sec. 16.413 would require the preparation of a report of

investigation which would be provided to the Assistant Administrator

and served on the parties. Under proposed Sec. 16.415, the Assistant

Administrator would issue an initial determination after review of the

record developed in the investigation, including the presiding

officer's report. The initial determination would be appealable to the

Administrator or his designee under the provisions of Sec. 16.31.

Proposed Sec. 16.415 would provide for automatic suspension, 30

days after the initial determination, of eligibility to receive new

Airport Improvement Program grants or payments under existing grants if

the initial determination finds that the challenged rate or charge is

unreasonable or unjustly discriminatory. However, the suspension would

be deferred if the respondent issued an appropriate rescission of the

disputed rate or charge pending completion of the proceeding under part

16.

Request for Comments

Interested persons are invited to comment on any aspect of the

proposed rules. The FAA is particularly interested in comment on the

following issues:

1. Whether the proposed rule strikes the right balance between

providing an opportunity to be heard, on the one hand, and producing an

expeditious agency decision, on the other.

2. Whether the overall time frames provided from complaint to

initial agency determination and from appeal to final agency decision

are practical.

3. Whether the particular time limits provided for each procedural

step are adequate.

4. The placement of responsibility for investigation, hearing, and

adjudication of complaints received by the FAA.

Regulatory Evaluation Summary

This notice proposes to adopt a new procedure for the filing,

investigation, and adjudication of complaints against airports for

violation of certain statutes administered by the FAA. The new

procedures would be substituted for existing procedures under 14 CFR

part 13. While the proposed rule differs in many details from the

existing rule, the costs to a complainant and respondent involved in

the complaint process would be virtually identical to the costs

involved under the existing rule. Accordingly, the expected economic

impact of this proposed amendment would be so minimal that a full

Regulatory Evaluation is not warranted.

International Trade Impact Statement

This rule is not anticipated to affect the import of foreign

products or services into the United States or the export of U.S.

products or services to foreign countries.

Regulatory Flexibility Determination

The Regulatory Flexibility Act (RFA) of 1980 was enacted by

Congress to ensure that small entities are not unnecessarily or

disproportionately burdened by Government regulations. The RFA requires

a Regulatory Flexibility Analysis if a rule would have a significant

economic impact, either detrimental or beneficial, on a substantial

number of small entities. Based on the potential relief that the rule

will provide and the criteria of implementing FAA Order 2100.14A,

Regulatory Flexibility Criteria and Guidance, the FAA has determined

that the rule will not have a significant economic impact on a

substantial number of small entities.

Federalism Implications

The regulations proposed herein would not have substantial direct

effects on the States, on the relationship between the national

government and the States, or on the distribution of power and

responsibilities among the various levels of government. Therefore, in

accordance with Executive Order 12612, it is determined that this

proposal would not have sufficient federalism implications to warrant

the preparation of a Federalism Assessment.

Paperwork Reduction Act

This proposed rule contains no information collection requirements

that require approval of the Office of Management and Budget pursuant

to the Paperwork Reduction Act of 1980 (44 U.S.C. 3507 et seq.)

Conclusion

For the reasons discussed in the preamble, and based on the

findings in the Regulatory Flexibility Determination and the

International Trade Analysis, the FAA has determined that this proposed

regulation is not economically significant under Executive Order 12866.

However, due to the public interest in this rulemaking, this proposed

rule is considered significant under the Executive Order. The FAA

certifies that this proposal, if adopted, will not have a significant

economic impact, positive or negative, on a substantial number of small

entities under the criteria of the Regulatory Flexibility Act. This

proposal is considered significant under DOT Regulatory Policies and

Procedures (44 FR 11034; February 26, 1978).

List of Subjects

14 CFR Part 13

Enforcement procedures, Investigations, Penalties.

14 CFR Part 16

Enforcement procedures, Investigations.

The Proposed Amendments

Accordingly, the Federal Aviation Administration proposes to amend

part 13 and adopt new part 16 of the Federal Aviation Regulations (14

CFR parts 13 and 16) as follows:

PART 13--INVESTIGATIVE AND ENFORCEMENT PROCEDURES

1. The authority citation for part 13 continues to read as follows:

Authority: 49 U.S.C. 106(g) and 322; 49 U.S.C. App. 1354(a) and

(c), 1374(d), 1401-1406, 1421-1432, 1471-1473, 1481, 1482, 1484-

1489, 1523, 1655(c), 1808-1810, 2157(e) and (f), 2218, 2219; 16

U.S.C. 6002, 6004; 49 CFR 1.47.

2. Section 13.3 is amended by adding paragraph (d), to read as

follows:

Sec. 13.3 Investigations (general).

* * * * *

(d) A complaint against the sponsor, proprietor, or operator of a

Federally-assisted airport shall be filed in accordance with the

provisions of part 16 of this chapter. Notwithstanding other provisions

of this part, complaints, investigations, and agency decisions

involving violations of the legal authorities listed in Sec. 16.1 of

this chapter are governed exclusively by the provisions of part 16 of

this chapter.

3. A new part 16 is added to read as follows:

PART 16--RULES OF PRACTICE FOR FEDERALLY ASSISTED AIRPORT

ENFORCEMENT PROCEEDINGS

Subpart A--General Provisions

Sec.

16.1 Applicability and description of part.

16.3 Definitions.

16.5 Separation of functions.

Subpart B--General Rules Applicable to Complaints, Proceedings

Initiated by the FAA, and Appeals

16.11 Expedition and other modification of process.

16.13 Filing of documents.

16.15 Service of documents on the parties and the agency.

16.17 Computation of time.

16.19 Motions.

Subpart C--Special Rules Applicable to Complaints

16.21 Pre-complaint resolution.

16.23 Complaints, answers, replies, rebuttals, and other documents.

16.25 Dismissals.

16.27 Incomplete complaints.

16.29 Investigations.

16.31 Initial determinations after investigations.

16.33 Final decisions without hearing.

Subpart D--Special Rules Applicable to Proceedings Initiated by the FAA

16.101 Basis for the initiation of agency action.

16.103 Notice of investigation.

16.105 Failure to resolve informally.

Subpart E--Proposed Orders of Compliance

16.109 Orders terminating eligibility for grants, cease and desist

orders, and other compliance orders.

Subpart F--Hearings

16.201 Notice and order of hearing.

16.202 Powers of a hearing officer.

16.203 Appearances, parties, and rights of parties.

16.207 Intervention and other participation.

16.209 Extension of time.

16.211 Prehearing conference.

16.213 Discovery.

16.215 Depositions.

16.217 Witnesses.

16.219 Subpoenas.

16.221 Witness fees.

16.223 Evidence.

16.225 Public disclosure of evidence.

16.227 Standard of proof.

16.229 Burden of proof.

16.231 Offer of proof.

16.233 Record.

16.235 Argument before the hearing officer.

16.237 Waiver of procedures.

Subpart G--Initial Decisions, Orders and Appeals

16.241 Initial decisions, orders, and appeals.

16.243 Consent orders.

Subpart H--Judicial Review

16.247 Judicial review of a final decision and order.

Subpart I--Ex Parte Communications

16.301 Definitions.

16.303 Prohibited ex parte communications.

16.305 Procedures for handling ex parte communications.

16.307 Requirement to show cause and imposition of sanction.

Subpart J--Alternate Procedure for Certain Complaints Concerning

Airport Rates and Charges

16.401 Availability of alternate complaint procedure

16.403 Answer and other documents.

16.405 Notice and order of investigation

16.407 Presiding officer.

16.409 Parties.

16.411 Investigation procedures.

16.413 Report of investigation.

16.415 Initial determination.

16.417 Eligibility for grants pending final agency decision.

Authority: 49 U.S.C. 106(g), 322; 49 U.S.C. 1110, 1111, and

1115; 49 U.S.C. App. 1349 (a) and (c), 1354 (a) and (c), 1482 (a),

(b) and (c), 1486, and 1513 (a) through (d) and (f); 49 U.S.C. 1718

(a) and (b), 1719, 1723, 1726 and 1727; 49 U.S.C. App. 2204 (a),

(b), (c), (d) and (h), 2210(a), 2211(a), 2215, 2218, 2219, and

2222(c); 50 U.S.C. App. 1622(g); 49 U.S.C. App. 1655(c); 49 CFR

1.47.

Subpart A--General Provisions

Sec. 16.1 Applicability and description of part.

(a) General. The provisions of this part govern all proceedings

involving Federally-assisted airports, whether the proceedings are

instituted by order of the FAA or by filing with the FAA of a

complaint, under the following authorities:

(1) Section 308 of the Federal Aviation Act of 1958, as amended, 49

U.S.C. App. 1349, prohibiting the grant of exclusive rights for the use

of any landing area or air navigation facility on which Federal funds

have been expended.

(2) Requirements of the Anti-Head Tax Act, section 1113 (a) through

(d) of the Federal Aviation Act, 49 U.S.C. App. 1513 (a)-(d).

(3) The assurances contained in grant-in-aid agreements issued

under the Federal Airport Act of 1946, 49 U.S.C. 1101 et seq.

(4) The assurances 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 contained in grant-in-aid agreements issued

under the Airport and Airway Improvement Act of 1982, as amended,

(AAIA) 49 U.S.C. App. 2201 et seq., specifically section 511(a), 49

U.S.C. App. 2210(a).

(6) Section 505(d) of the Airport and Airway Improvement Act of

1982, as amended, 49 U.S.C. App. 2214(d).

(7) Obligations contained in property deeds for property

transferred under to section 16 of the Federal Airport Act (49 U.S.C.

1115), section 23 of the Airport and Airway Development Act (49 U.S.C.

1723), or section 516 of the Airport and Airway Improvement Act (49

U.S.C. App. 2215).

(8) Obligations contained in property deeds for property

transferred under the Surplus Property Act (50 U.S.C. 1622(g)).

(b) Other agencies. Where a grant assurance concerns a statute,

executive order, regulation, or other authority that provides an

administrative process for the investigation or adjudication of

complaints by a Federal agency other than the FAA, complaints shall use

the administrative process established by those authorities. Where a

grant assurance concerns a statute, executive order, regulation, or

other authority that enables a Federal agency other than the FAA to

investigate, adjudicate, and enforce compliance under those authorities

on its own initiative, the FAA may defer to that Federal agency.

(c) Other enforcement. If a complaint or action initiated by the

FAA involves a violation of the Federal Aviation Act or FAA

regulations, except as specified in paragraphs (a)(1) and (a)(7) of

this section, the FAA may take investigative and enforcement action

under 14 CFR part 13, ``Investigative and Enforcement Procedures.''

(d) Effective date: This part applies to a complaint filed with the

FAA on or after [effective date of final rule].

Sec. 16.3 Definitions.

Terms defined in the Acts are used as so defined. As used in this

part:

Act means a statute listed in Sec. 16.1 of this part or any

regulation, agreement, or document of conveyance issued or made under

that statute.

Administrator means the Administrator or his designee.

Agency attorney means the Deputy Chief Counsel; the Assistant Chief

Counsel and attorneys in the Airports/Environmental Law Division of the

Office of the Chief Counsel; the Assistant Chief Counsel and attorneys

in an FAA region or center who represent the FAA during the

investigation of a complaint or at a hearing on a complaint, and who

prosecute on behalf of the FAA, as appropriate. An agency attorney

shall not include the Chief Counsel, the Assistant Chief Counsel for

Litigation, or any attorney on the staff of the Assistant Chief Counsel

for Litigation who advises the FAA decisionmaker regarding an initial

decision of the hearing officer or any appeal to the decisionmaker or

who is supervised in that action by a person who provides such advice

in an action covered by this part.

Assistant Administrator means the Assistant Administrator for

Airports.

Complainant means the person submitting a complaint.

Complaint means a written document meeting the requirements of this

part filed with the FAA by a person directly and substantially affected

by anything allegedly done or omitted to be done by any person in

contravention of any provision of any Act, as defined in this section,

as to matters within the jurisdiction of the Administrator.

FAA decisionmaker means the Administrator of the FAA or any person

to whom the Administrator has delegated the authority to issue a final

decision and order of the Administrator on appeal from the initial

decision of a hearing officer.

File means to submit written documents to the FAA for inclusion in

the Enforcement Docket or to a hearing officer or presiding officer as

appropriate.

Final decision and order means a final agency decision on the

disposition of a complaint or on a respondent's compliance with any

Act, as defined in this section, and directs appropriate action. A

final decision and order that finds noncompliance may direct any

sanction authorized by applicable laws.

Hearing officer means an attorney designated by the FAA 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 Assistant Chief Counsel and

attorneys in the FAA region or center in which the noncompliance has

allegedly occurred or is occurring; and the Assistant Chief Counsel and

attorneys in the Airports and Environmental Law Division of the FAA

Office of the Chief Counsel.

Initial decision means a decision made by the hearing officer in a

hearing under subpart F of this part.

Initial determination means a non-final agency decision following

an investigation, including an investigation by investigative hearing

under subpart J of this part.

Mail means U.S. first class mail; U.S. certified mail; and U.S.

Express mail.

Noncompliance means anything done or omitted to be done by any

person in contravention of any provision of any Act, as defined in this

section, as to matters within the jurisdiction of the Administrator.

Party means the complainant(s) and the respondent(s) named in the

complaint and, when an initial determination providing an opportunity

for hearing is issued under Sec. 16.31 and subpart E of this part, the

agency.

Person means an individual, professional or other association,

business or other private organization, including a sole

proprietorship, partnership, or corporation, or a State or any agency

of a State, such as a municipality or other political subdivision of a

State, a tax-supported organization, or an Indian tribe or pueblo.

Personal delivery means hand delivery or overnight express delivery

service.

Presiding officer means a person designated by the Assistant

Administrator to preside over the investigation provided in subpart J

of this part, who is neither an agency attorney as defined in this

section or a person otherwise engaged in the investigation of airport

compliance.

Respondent means any person named in a complaint as a person

responsible for things done or omitted to be done in contravention of

any provision of any Act as to matters within the jurisdiction of the

Administrator.

Sponsor means:

(1) Any public agency which, either individually or jointly with

one or more other public agencies, has received Federal financial

assistance for airport development or planning under the Federal

Airport Act, Airport and Airway Development Act or Airport and Airway

Improvement Act.

(2) Any private owner of a public-use airport who has received

financial assistance from the FAA for such airport; and

(3) Any person to whom the Federal government has conveyed property

for airport purposes under section 13(g) of the Surplus Property Act of

1944, as amended.

Sec. 16.5 Separation of functions.

(a) Proceedings under this part, including hearings under subpart F

of this part, will be prosecuted by an agency attorney.

(b) After issuance of an initial determination in which the FAA

provides the opportunity for a hearing, an agency employee engaged in

the performance of investigative or prosecutorial functions in a

proceeding under this part will not, in that case or a factually

related case, participate or give advice in an initial decision by the

hearing officer, a final decision by the Administrator or designee on

written appeal, or final decision by the FAA decisionmaker, and will

not, except as counsel or as witness in the public proceedings, engage

in any substantive communication regarding that case or a related case

with the hearing officer, the Administrator on written appeal, the FAA

decisionmaker, or agency employees advising those officials in that

capacity.

(c) The Chief Counsel, the Assistant Chief Counsel for Litigation,

or an attorney on the staff of the Assistant Chief Counsel for

Litigation advises the FAA decisionmaker regarding an initial decision,

an appeal, or a final decision regarding any case brought under this

part.

Subpart B--General Rules Applicable to Complaints, Proceedings

Initiated by the FAA, and Appeals

Sec. 16.11 Expedition and other modification of process.

Under the authority of 49 U.S.C. 1354(a) and 2218(a), the Assistant

Administrator may conduct investigations, issue orders, and take such

other actions as are necessary to fulfill the purposes of this part,

including the extension of any time period prescribed where necessary

or appropriate for a fair and complete hearing of matters before the

agency. Notwithstanding any other provision of this part, upon finding

that circumstances require expedited handling of a particular case or

controversy, the Assistant Administrator may issue an order directing

any of the following prior to the issuance of an initial determination:

(a) Shortening the time period for any action under this part

consistent with due process;

(b) If other adequate opportunity to respond to pleadings is

available, eliminating the reply, rebuttal, or other actions prescribed

by this part;

(c) Authorizing a presiding officer to adopt expedited procedures;

(d) Designating alternative methods of service; or

(e) Directing such other measures as may be required.

Sec. 16.13 Filing of documents.

Except as otherwise provided in this part, documents shall be filed

with the FAA during a proceeding under this part as follows:

(a) Filing address. Documents to be filed with the FAA shall be

filed with the Office of the Chief Counsel, Attention: FAA Enforcement

Docket (AGC-10), Federal Aviation Administration, 800 Independence

Ave., SW., Washington, DC 20591. Documents to be filed with a hearing

officer shall be filed at the address stated in the hearing order.

Documents to be filed with a presiding officer shall be filed at the

address stated in the notice of investigation.

(b) Date and method of filing. Filing of any document shall be by

personal delivery or mail as defined in this part, or by facsimile

(when confirmed by filing on the same date by one of the foregoing

methods). Unless the date is shown to be inaccurate documents to be

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.

(c) Number of copies. Unless otherwise specified, an executed

original and three copies of each document shall be filed with the FAA

Enforcement Docket. Copies need not be signed, but the name of the

persons signing the original shall be shown. If a hearing order or

notice and order of investigation has been issued in the case one of

the three copies shall be filed with the hearing officer or presiding

officer. If filing by facsimile, the facsimile copy does not constitute

one of the copies required under this section.

(d) Form. Documents filed with the FAA shall be typewritten or

legibly printed. In the case of docketed proceedings, the document

shall include the docket number of the proceeding on the front page.

(e) Signing of documents and other papers. The original of every

document filed shall be signed by the person filing it or the person's

duly authorized representative. The signature shall serve as a

certification that the signer has read the document and, based on

reasonable inquiry and to the best of the signer's knowledge,

information, and belief, the document is--

(1) Consistent with this part;

(2) Warranted by existing law or that a good faith argument exists

for extension, modification, or reversal of existing law; and

(3) Not interposed for any improper purpose, such as to harass or

to cause unnecessary delay or needless increase in the cost of the

administrative process.

(f) Designation of person to receive service. The initial document

filed shall state on the first page the name, post office address,

telephone number, and facsimile number, if any, 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 Enforcement Docket and the hearing officer and

shall serve the notice on all parties.

(g) Docket numbers. Each submission identified as a complaint

under this part by the submitting person will be assigned a docket

number.

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

Except as otherwise provided in this part, documents shall be

served as follows:

(a) Who must be served. Copies of all documents filed with the FAA

Enforcement Docket 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 and

facsimile numbers (if also served by facsimile) by [specify method

of service]:

[list persons, addresses, facsimile numbers]

Dated this ______ day of __________, 19 ______.

[signature], for [party]

(b) Method of service. Except as otherwise agreed by the parties

and the hearing officer, the method of service is the same as set forth

in Sec. 16.13(b) for filing documents.

(c) Where service shall be made. Service shall be made to the

persons identified in accordance with Sec. 16.13(f). If no such person

has been designated, service shall be made on the party.

(d) Presumption of service. There shall be a presumption of lawful

service--

(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.

(e) Date of service. The date of service shall be determined in the

same manner as the filing date under Sec. 16.13(b).

Sec. 16.17 Computation of time.

This section applies to any period of time prescribed or allowed by

this part, by notice or order of the hearing officer or presiding

officer, or by an applicable statute.

(a) The date of an act, event, or default, after which a designated

time period begins to run, is not included in a computation of time

under this part.

(b) The last day of a time period is included in a computation of

time unless it is a Saturday, Sunday, or legal holiday for the FAA, in

which case, the time period runs until the end of the next day that is

not a Saturday, Sunday, or legal holiday.

(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 mail, 5 days shall be added

to the prescribed period.

Sec. 16.19 Motions.

(a) General. An application for an order or ruling not otherwise

specifically provided for in this part shall be by motion. Unless

otherwise ordered by the agency, the filing of a motion will not stay

the date that any action is permitted or required by this part.

(b) Form and contents. Unless made during a hearing, motions shall

be made in writing, shall state with particularity the relief sought

and the grounds for the relief sought, and shall be accompanied by

affidavits or other evidence relied upon. Motions introduced during

hearings may be made orally on the record, unless the hearing officer

or presiding officer directs otherwise.

(c) Answers to motions. Except as otherwise provided in this part,

or except when a motion is made during a hearing, any party may file an

answer in support of or in opposition to a motion, accompanied by

affidavits or other evidence relied upon, provided that the answer to

the motion is filed within 10 days after the motion has been served

upon the person answering, or any other period set by the hearing

officer. Where a motion is made during a hearing, the answer and the

ruling thereon may be made at the hearing, or orally or in writing

within the time set by the hearing officer or presiding officer.

Subpart C--Special Rules Applicable to Complaints

Sec. 16.21 Pre-complaint resolution.

(a) 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,

use of a dispute resolution board.

(b) A complaint under this part will not be considered unless the

person or authorized representative filing the complaint certifies that

he or she has engaged in substantial and reasonable good faith efforts

to resolve the disputed matter informally prior to filing the complaint

and that there appears no reasonable prospect for timely resolution of

the dispute. This certification 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.

Sec. 16.23 Complaints, answers, replies, rebuttals, and other

documents.

(a) A person directly and substantially affected by any alleged

noncompliance may file a complaint with the Administrator.

(b) Complaints filed under this part shall--

(1) State the name and address of each person who is the subject of

the complaint and, with respect to each person, the specific provisions

of each Act that the complainant believes was violated;

(2) Be served, in accordance with Sec. 16.15 of this part, along

with all documents then available in the exercise of reasonable

diligence, offered in support of the complaint, upon all persons named

in the complaint as persons responsible for the alleged action(s) or

omission(s) upon which the complaint is based;

(3) Provide a concise but complete statement of the facts relied

upon to substantiate each allegation;

(4) Describe how the complainant was directly and substantially

affected by the things done or omitted to be done by the respondents;

and

(5) Comply with any additional or special requirements of subpart J

of this part, if the complaint is brought under subpart J of this part.

(c) Unless the complaint is dismissed pursuant to Sec. 16.25 or

Sec. 16.27, the FAA notifies the complainant and respondents in writing

within 20 days after the date the FAA receives the complaint that the

complaint has been docketed and that respondents are required to file

an answer within 20 days of the date of service of the notification.

(d) The respondent shall file an answer within 20 days of the date

of service of the FAA notification.

(e) The complainant may file a reply within 15 days of the date of

service of the answer.

(f) The respondent may file a rebuttal within 15 days of the date

of service of the complainant's rebuttal.

(g) The answer, reply, and rebuttal shall, like the complaint, be

accompanied by supporting documentation upon which the parties rely.

(h) The answer shall deny or admit the allegations made in the

complaint or state that the person filing the document is without

sufficient knowledge or information to admit or deny any allegation,

and shall assert any affirmative defense.

(i) The answer, reply, and rebuttal shall each contain a concise

but complete statement of the facts relied upon to substantiate the

answers, admissions, denials, or averments made.

(j) The respondent's answer may include a motion to dismiss the

complaint, or any portion thereof, with a supporting memorandum of

points and authorities. If a motion to dismiss is filed, the

complainant may respond as part of its rebuttal notwithstanding the 10-

day time limit for answers to motions in Sec. 16.19(c).

Sec. 16.25 Dismissals.

Within 20 days after the receipt of the complaint, the Assistant

Administrator will dismiss a complaint, or any claim made in a

complaint, with prejudice if it: Appears on its face to be outside the

jurisdiction of the Administrator under the Acts listed in Sec. 16.1;

or on its face does not state a claim that warrants an investigation or

further action by the FAA. The FAA will advise the person who filed the

complaint or the person's duly authorized representative and the

person(s) named in the complaint of the reasons for the dismissal.

Sec. 16.27 Incomplete complaints.

If a complaint is not dismissed pursuant to Sec. 16.25, but is

deficient as to one or more of the requirements set forth in Sec. 16.21

or Sec. 16.23(b), the Assistant Administrator 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 FAA shall advise the person who filed the complaint

or the person's duly authorized representative and the person(s) named

in the complaint of the reasons for the dismissal.

Sec. 16.29 Investigations.

(a) If, based on the pleadings, there appears to be a reasonable

basis for further investigation, the FAA investigates the subject

matter of the complaint.

(b) The investigation may include one or more of the following, at

the sole discretion of the FAA:

(1) A review of the written submissions or pleadings of the

parties, as supplemented by any informal investigation the FAA

considers necessary and by additional information furnished by the

parties at FAA request. In rendering its initial determination, the FAA

may rely entirely on the complaint and the responsive pleadings

provided under this subpart, and each party shall file documents that

it considers sufficient to present all relevant facts and argument

necessary for the FAA to determine whether the sponsor is in

compliance.

(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 and Section 519 of the Airport

and Airway Improvement Act. The Administrator's statutory authority to

issue compulsory process has been delegated to the Chief Counsel, the

Deputy Chief Counsel, the Assistant Chief Counsel for Airports and

Environmental Law, and each Assistant Chief Counsel for a region or

center.

(3) Conducting, or requiring that a sponsor conduct, an audit of

airport financial records and transactions, as provided in 49 U.S.C.

2210(a)(11) and 2217.

Sec. 16.31 Initial determinations after investigations.

(a) After consideration of the pleadings and other information

obtained by the FAA after investigation, the Assistant Administrator

will render an initial determination and provide it to each party by

certified mail within 120 days of the date the last pleading specified

in Sec. 16.23 was due. The time for issuing an initial determination

may be extended for a period of up to 60 days upon a written

determination by the Assistant Administrator that:

(1) The additional time is necessary for investigation and analysis

of the matters in the complaint; or

(2) The investigation has been delayed by actions of a complainant.

(b) The initial determination will set forth a concise explanation

of the factual and legal basis for the Assistant Administrator's

determination on each claim made by the complainant.

(c) A party adversely affected by the initial determination may

appeal the initial determination to the Administrator as provided in

Sec. 16.33.

(d) If the initial 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. The respondent may elect or waive a

hearing as provided in subpart E of this part.

Sec. 16.33 Final decisions without hearing.

(a) The Administrator will issue a final decision on appeal from an

initial 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.

(b) In the cases described in paragraph (a) of this section a party

adversely affected by the initial determination may file an appeal with

the Administrator within 30 days after the date of service of the

initial determination.

(c) A reply to an appeal may be filed with the Administrator within

20 days after the date of service of the appeal.

(d) The Administrator will issue a final decision and order within

30 days after the due date of the reply.

(e) If no appeal is filed within the time period specified in

paragraph (b) of this section, the initial determination becomes the

final decision and order of the FAA without further action. An initial

determination that becomes final because there is no administrative

appeal is not judicially reviewable.

Subpart D--Special Rules Applicable to Proceedings Initiated by the

FAA

Sec. 16.101 Basis for the initiation of agency action.

The FAA may initiate its own investigation of any matter within the

applicability of this part without having received a complaint. The

investigation may include, without limitation, any of the actions

described in Sec. 16.29(b).

Sec. 16.103 Notice of investigation.

Following the initiation of an investigation under Sec. 16.101 of

this part, the FAA sends a notice to the person(s) subject to

investigation. The notice will set forth the areas of the agency's

concern and the reasons therefor; request a response to the notice

within 30 days of the date of service; and inform the respondent that

the FAA will, in its discretion, invite good faith efforts to resolve

the matter.

Sec. 16.105 Failure to resolve informally.

If the matters addressed in the FAA notices are not resolved

informally, the FAA may issue an initial determination under

Sec. 16.31.

Subpart E--Proposed Orders of Compliance

Sec. 16.109 Orders terminating eligibility for grants, cease and

desist orders, and other compliance orders.

This section applies to initial determinations issued under

Sec. 16.31 that provide the opportunity for a hearing.

(a) The agency will provide the opportunity for a hearing if, in

the initial determination, the agency proposes to issue an order

terminating eligibility for grants, an order suspending the payment of

grant funds, 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. In cases in

which a hearing is not required by statute, the FAA may provide

opportunity for a hearing at its discretion.

(b) In a case in which the agency provides the opportunity for a

hearing, the initial determination issued under Sec. 16.31 will include

a statement of the availability of a hearing under subpart F of this

part.

(c) Within 30 days after service of an initial determination under

Sec. 16.31 and paragraph (b) of this section, a person subject to the

proposed compliance order may--

(1) Request a hearing under subpart F of this part;

(2) Waive hearing and appeal the notice in writing to the

Administrator, as provided in Sec. 16.33;

(3) File, jointly with the complainant, a motion to withdraw the

complaint and to dismiss the proposed compliance action; or

(4) Submit, jointly with the agency attorney, a proposed consent

order under Sec. 16.243(e).

(d) If the respondent fails to request a hearing or to file an

appeal in writing within the time periods provided in paragraph (c) of

this section, the initial determination becomes final.

Subpart F--Hearings

Sec. 16.201 Notice and order of hearing.

(a) If a respondent is provided the opportunity for hearing in an

initial determination and does not waive hearing, the Deputy Chief

Counsel within 10 days after the respondent elects a hearing will issue

and serve on the respondent a hearing order. The hearing order will set

forth:

(1) The allegations in the complaint, and the chronology and

results of the investigation preliminary to the hearing;

(2) The relevant statutory, judicial, regulatory, and other

authorities;

(3) The issues to be decided;

(4) Such rules of procedure as may be necessary to supplement the

provisions of this part;

(5) The name and address of the person designated as hearing

officer, and the assignment of authority to the hearing officer to

conduct the hearing in accordance with the procedures set forth in this

part;

(6) The date by which the hearing officer is directed to issue an

initial decision.

(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.

Sec. 16.202 Powers of a hearing officer.

In accordance with the rules of this subpart, a hearing officer

may:

(a) Give notice of, and hold, prehearing conferences and hearings;

(b) Administer oaths and affirmations;

(c) Issue subpoenas authorized by law and issue notices of

deposition requested by the parties;

(d) Rule on offers of proof;

(e) Receive relevant and material evidence;

(f) Regulate the course of the hearing in accordance with the rules

of this part to avoid unnecessary and duplicative proceedings in the

interest of prompt and fair resolution of the matters at issue;

(g) Hold conferences to settle or to simplify the issues by consent

of the parties;

(h) Dispose of procedural motions and requests;

(i) Examine witnesses; and

(j) Make findings of fact and conclusions of law, and issue an

initial decision.

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

(a) Appearances. Any party may appear and be heard in person.

(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.

(2) An attorney who represents a party shall file a notice of

appearance in accordance with Sec. 16.15(f).

(b) Parties and agency participation.

(1) The parties to the hearing are the respondent(s) named in the

hearing order, and 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 initial determination providing an opportunity for

hearing.

(3) As appropriate to the issues raised in a particular case,

offices and services of the FAA and the Office of the Secretary may

assist the FAA attorney consistent with the provisions of Sec. 16.5.

Sec. 16.207 Intervention and other participation.

(a) A person may submit a 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.

(b) If the hearing officer finds that intervention will not unduly

broaden the issues or delay the proceedings and, if the person has a

property or financial interest that may not be addressed adequately by

the parties, 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.

(c) Other persons may petition the hearing officer for leave to

participate in the hearing. Participation is limited to the filing of

post-hearing briefs and reply to the hearing officer and the

decisionmaker. Such briefs shall be filed and served on all parties in

the same manner as the parties' post hearing briefs are filed.

(d) Participation under this section is at the discretion of the

FAA, and no decision permitting participation shall be deemed to

constitute an expression by the FAA that the participant has such a

substantial interest in the proceeding as would entitle it to judicial

review of such decision.

Sec. 16.209 Extension of time.

(a) Extension by oral agreement. The parties may agree to extend

for a reasonable period the time for filing a document under this part.

If the parties agree, the hearing officer shall grant one extension of

time to each party. The party seeking the extension of time shall

submit a draft order to the hearing officer to be signed by the hearing

officer and filed with the hearing docket. The hearing officer may

grant additional oral requests for an extension of time where the

parties agree to the extension.

(b) Extension by motion. A party shall file a written motion for an

extension of time with the hearing officer not later than 7 days before

the document is due unless good cause for the late filing is shown. A

party filing a written motion for an extension of time shall serve a

copy of the motion on each party.

(c) Failure to rule. If the hearing officer fails to rule on a

written motion for an extension of time by the date the document was

due, the motion for an extension of time is deemed denied.

(d) Effect on time limits. If the hearing officer grants an

extension of time as a result of oral agreement by the parties as

specified in paragraph (a) of this section or, if the hearing officer

grants an extension of time as a result of the sponsor's failure to

adhere to the hearing schedule, the due date for the hearing officer's

initial decision and for the final agency decision are extended by the

length of the extension by the hearing officer, in accordance with

section 519(b) of the AAIA, as amended in 1987.

Sec. 16.211. Prehearing conference.

(a) Prehearing conference notice. The hearing officer schedules a

prehearing conference and serves a prehearing conference notice on the

parties promptly after being designated as a hearing officer.

(1) The prehearing conference notice specifies the date, time,

place, and manner (in person or by telephone) of the prehearing

conference.

(2) The prehearing conference notice may direct the parties to

exchange proposed witness lists, requests for evidence and the

production of documents in the possession of another party, responses

to interrogatories, admissions, proposed procedural schedules, and

proposed stipulations before the date of the prehearing conference.

(b) The prehearing conference. The prehearing conference is

conducted by telephone or in person, at the hearing officer's

discretion. The prehearing conference addresses matters raised in the

prehearing conference notice and such other matters as the hearing

officer determines will assist in a prompt, full and fair hearing of

the issues.

(c) Prehearing conference report. At the close of the prehearing

conference, the hearing officer rules on any requests for evidence and

the production of documents in the possession of other parties,

responses to interrogatories, and admissions; on any requests for

depositions; on any proposed stipulations; and on any pending

applications for subpoenas as permitted by Sec. 16.219. In addition,

the hearing officer establishes the schedule, which shall provide for

the issuance of an initial decision not later than 120 days after

issuance of the initial determination order unless otherwise provided

in the hearing order.

Sec. 16.213 Discovery.

Discovery is limited to requests for admissions, requests for

production for documents, interrogatories, and depositions as

authorized by Sec. 16.215.

Sec. 16.215 Depositions.

(a) General. For good cause shown, the hearing officer may order

that the testimony of a witness may be taken by deposition and that the

witness produce documentary evidence in connection with such testimony.

Generally, an order to take the deposition of a witness is entered only

if:

(1) The person whose deposition is to be taken would be unavailable

at the hearing; or

(2) The deposition is deemed necessary to perpetuate the testimony

of the witness; or

(3) The taking of the deposition is necessary to prevent undue and

excessive expense to a party and will not result in undue burden to

other parties or in undue delay.

(b) Application for deposition. Any party desiring to take the

deposition of a witness shall make application therefor to the hearing

officer in writing, with a copy of the application served on each

party. The application shall include:

(1) The name and residence of the witness;

(2) The time and place for the taking of the proposed deposition;

(3) The reasons why such deposition should be taken; and

(4) A general description of the matters concerning which the

witness will be asked to testify.

(c) Order authorizing deposition. If good cause is shown, the

hearing officer, in his or her discretion, issues an order authorizing

the deposition and specifying the name of the witness to be deposed,

the location and time of the deposition and the general scope and

subject matter of the testimony to be taken.

(d) Procedures for deposition. (1) Witnesses whose testimony is

taken by deposition shall be sworn or shall affirm before any questions

are put to them. Each question propounded shall be recorded and the

answers of the witness transcribed verbatim.

(2) Objections to questions or evidence shall be recorded in the

transcript of the deposition. The interposing of an objection shall not

relieve the witness of the obligation to answer questions, except where

the answer would violate a privilege.

(3) The written transcript shall be subscribed by the witness,

unless the parties by stipulation waive the signing or the witness is

ill or cannot be found or refuses to sign. The reporter shall note the

reason for failure to sign.

Sec. 16.217 Witnesses.

(a) Each party may designate as a witness any person who is able

and willing to give testimony that is relevant and material to the

issues in the hearing case, subject to the limitation set forth in

paragraph (b) of this section.

(b) The hearing officer may exclude testimony of witnesses that

would be irrelevant, immaterial, or unduly repetitious.

(c) Any witness may be accompanied by counsel. Counsel representing

a nonparty witness has no right to examine the witness or otherwise

participate in the development of testimony.

Sec. 16.219 Subpoenas.

(a) Request for subpoena. A party may apply to the hearing officer,

within the time specified for such applications in the prehearing

conference report, for a subpoena to compel testimony at a hearing or

to require the production of documents only from the following persons:

(1) Another party;

(2) An officer, employee or agent of another party;

(3) Any other person named in the complaint as participating in or

benefiting from the actions of the respondent alleged to have violated

any Act; or

(4) An officer, employee or agent of any other person named in the

complaint as participating in or benefiting from the actions of the

respondent alleged to have violated any Act.

(b) Issuance and service of subpoena. (1) The hearing officer

issues the subpoena if the hearing officer determines that the evidence

to be obtained by the subpoena is relevant and material to the

resolution of the issues in the case.

(2) Subpoenas shall be served by personal service, or upon an agent

designated in writing for the purpose, or by registered or certified

mail addressed to such person or agent. Whenever service is made by

registered or certified mail, the date of mailing shall be considered

at the time when service is made.

(3) A subpoena issued under this part is effective throughout the

United States or any territory or possession thereof.

(c) Motions to quash or modify subpoena. (1) A party or any person

upon whom a subpoena has been served may file a motion to quash or

modify the subpoena with the hearing officer at or before the time

specified in the subpoena for the filing of such motions. The applicant

shall describe in detail the basis for the application to quash or

modify the subpoena including, but not limited to, a statement that the

testimony, document, or tangible evidence is not relevant to the

proceeding, that the subpoena is not reasonably tailored to the scope

of the proceeding, or that the subpoena is unreasonable and oppressive.

(2) A motion to quash or modify the subpoena stays the effect of

the subpoena pending a decision by the hearing officer on the motion.

Sec. 16.221 Witness fees.

(a) The party on whose behalf a witness appears is responsible for

paying any witness fees and mileage expenses.

(b) Except for employees of the United States summoned to testify

as to matters related to their public employment, witnesses summoned by

subpoena shall be paid the same fees and mileage expenses as are paid

to a witness in a court of the United States in comparable

circumstances.

Sec. 16.223 Evidence.

(a) General. A party may submit direct and rebuttal evidence in

accordance with this section.

(b) Requirement for written testimony and evidence. Except in the

case of evidence obtained by subpoena, or in the case of a special

ruling by the hearing officer to admit oral testimony, a party's direct

and rebuttal evidence shall be submitted in written form, in advance of

the oral hearing pursuant to the schedule established in the hearing

officer's prehearing conference report. Written direct and rebuttal

fact testimony shall be certified by the witness as true and correct.

Subject to the same exception (for evidence obtained by subpoena or

subject to a special ruling by the hearing officer), oral examination

of a party's own witness is limited to certification of the accuracy of

written evidence, including correction and updating, if necessary, and

reexamination following cross-examination by other parties.

(c) Subpoenaed testimony. Testimony of witnesses appearing under

subpoena may be obtained orally.

(d) Cross-examination. A party may conduct cross-examination that

may be required for disclosure of the facts, subject to control by the

hearing officer for fairness, expedition, and exclusion of extraneous

matters.

(e) Hearsay evidence. Hearsay evidence is admissible in proceedings

governed by this part. The fact that evidence is hearsay goes to the

weight of evidence and does not affect its admissibility.

(f) Admission of evidence. The hearing officer admits evidence

introduced by a party in support of its case in accordance with this

section, but may exclude irrelevant, immaterial or unduly repetitious

evidence.

(g) Expert or opinion witnesses. An employee of the FAA or DOT may

not be called as an expert or opinion witness for any party other than

the agency except as provided in Department of Transportation

regulations at 49 CFR part 9.

(h) Subpart J hearing. If an investigative hearing under subpart J

was held on the complaint, the hearing officer may limit fact testimony

and evidence in the hearing under this part to genuine issues of

material fact not adequately developed in the record of the initial

determination or not addressed in the initial determination.

Sec. 16.225 Public disclosure of evidence.

(a) Except as provided in this section, the hearing shall be open

to the public.

(b) The hearing officer may order that any information contained in

the record be withheld from public disclosure. Any person may object to

disclosure of information in the record by filing a written motion to

withhold specific information with the hearing officer. The person

shall state specific grounds for nondisclosure in the motion.

(c) The hearing officer shall grant the motion to withhold

information from public disclosure if the hearing officer determines

that disclosure would be in violation of the Privacy Act, would reveal

trade secrets or privileged or confidential commercial or financial

information, or is otherwise prohibited by law.

Sec. 16.227 Standard of proof.

The hearing officer shall issue an initial decision or shall rule

in a party's favor only if the decision or ruling is supported by, and

in accordance with, reliable, probative, and substantial evidence

contained in the record and is in accordance with law.

Sec. 16.229 Burden of proof.

(a) The burden of proof of noncompliance with an Act or any

regulation, order, agreement or document of conveyance issued under the

authority of an Act is on the agency.

(b) Except as otherwise provided by statute or rule, the proponent

of a motion, request, or order has the burden of proof.

(c) A party who has asserted an affirmative defense has the burden

of proving the affirmative defense.

Sec. 16.231 Offer of proof.

A party whose evidence has been excluded by a ruling of the hearing

officer may offer the evidence on the record when filing an appeal.

Sec. 16.233 Record.

(a) Subpart J investigation. If a special hearing was held on the

complaint under subpart J of this part, the pleadings, transcript of

hearing, all exhibits received into evidence, all motions,

applications, requests, and rulings, and all documents included in the

hearing record and the report of the investigation are entered into the

record of the hearing under this subpart.

(b) Exclusive record. The transcript of all testimony in the

hearing, all exhibits received into evidence, all motions,

applications, requests and rulings, and all documents included in the

hearing record shall constitute the exclusive record for decision in

the proceedings and the basis for the issuance of any orders.

(c) Examination and copying of record. Any interested person may

examine the record at the Enforcement Docket, Federal Aviation

Administration, 800 Independence Avenue, SW., room 924A, Washington, DC

20591. Any person may have a copy of the record after payment of

reasonable costs for search and reproduction of the record.

Sec. 16.235. Argument before the hearing officer.

(a) Argument during the hearing. During the hearing, the hearing

officer shall give the parties reasonable opportunity to present oral

argument on the record supporting or opposing motions, objections, and

rulings if the parties request an opportunity for argument. The hearing

officer may direct written argument during the hearing if the hearing

officer finds that submission of written arguments would not delay the

hearing.

(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. 16.237 Waiver of procedures.

(a) The hearing officer shall waive such procedural steps as all

parties to the hearing agree to waive before issuance of an initial

decision.

(b) Consent to a waiver of any procedural step bars the raising of

this issue on appeal.

(c) The parties may not by consent waive the obligation of the

hearing officer to enter an initial decision on the record.

Subpart G--Initial Decisions, Orders and Appeals

Sec. 16.241 Initial decisions, orders, 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 120 days after the initial

determination by the Assistant Administrator unless otherwise provided

in the hearing order.

(b) Each party adversely affected by the hearing officer's initial

decision may file an appeal within 20 days of the date the initial

decision is issued. Each party may file a reply to an appeal within 10

days after it is served on the party. Filing and service of appeals and

replies shall be by personal delivery.

(c) If an appeal is filed, the FAA decisionmaker reviews the entire

record and issues a final agency decision and order within 30 days

after the due date for replies to the appeal(s). If no appeal is filed,

the decisionmaker may take review of the case on his or her own motion.

If the FAA decisionmaker 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 a

statement of corrective action, if appropriate, and identifies

sanctions for continued noncompliance.

(d) If no appeal is filed, and the FAA decisionmaker does not take

review of the initial decision on the FAA decisionmaker's own motion,

the initial decision shall take effect as the final agency decision and

order on the twenty-first day after the actual date the initial

decision is issued.

(e) The failure to file an appeal is deemed a waiver of any rights

to seek judicial review of an initial decision that becomes a final

agency decision by operation of Sec. 16.241(d).

(f) If the FAA decisionmaker takes review on the decisionmaker's

own motion, the FAA decisionmaker issues a notice of review by the

twenty-first day after 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 FAA decisionmaker.

(2) Parties may file briefs on review to the FAA decisionmaker or

rely on their post-hearing briefs to the hearing officer. Briefs on

review shall be filed not later than 15 days after service of the

notice of review.

(3) The FAA decisionmaker issues a final agency decision and order

within 30 days after the due date for briefs on review. If the FAA

decisionmaker 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, and identifies sanctions for continued

noncompliance.

Sec. 16.243 Consent orders.

(a) The agency attorney and the respondents may agree at any time

before the issuance of a final decision and order 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. Except as provided in Sec. 16.209, 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;

(3) An express waiver of the right to further procedural steps and

of all rights to judicial review; and

(4) An incorporation by reference of the hearing order, if issued,

and an acknowledgment that the hearing order may be used to construe

the terms of the consent order.

(c) If the issuance of a consent order has been agreed upon by all

parties to the hearing, the proposed consent order shall be filed with

the hearing officer, along with a draft order adopting the consent

decree and dismissing the case, for the hearing officer's adoption.

(d) The deadline for the hearing officer's initial decision and the

final agency decision is extended by the amount of days elapsed between

the filing of the proposed consent order with the hearing officer and

the issuance of the hearing officer's order continuing the hearing.

(e) If the agency attorney and sponsor agree to dispose of a case

by issuance of a consent order before the FAA issues a hearing order,

the proposal for a consent order is submitted jointly to the official

authorized to issue a hearing order, together with a request to adopt

the consent order and dismiss the case. The official authorized to

issue the hearing order issues the consent order as an order of the FAA

and terminates the proceeding.

Subpart H--Judicial Review

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 Administrator as provided

in section 1006 of the Federal Aviation Act of 1958, as amended, or

section 519(b)(4) of the Airport and Airway Improvement Act of 1982, as

amended. A party seeking judicial review of a final decision and order

shall file a petition for review with the Court not later than 60 days

after a final decision and order under the AAIA has been served on the

party or within 60 days after the entry of an order under the Federal

Aviation Act.

(b) The following do not constitute final decisions and orders

subject to judicial review:

(1) An FAA decision to dismiss a complaint without prejudice, as

set forth in Sec. 16.17;

(2) An initial determination issued by the Assistant Administrator;

(3) An initial decision issued by a hearing officer at the

conclusion of a hearing;

(4) An initial determination or an initial decision of a hearing

officer that becomes the final decision of the Administrator because it

was not appealed within 30 days;

Subpart I--Ex Parte Communications

Sec. 16.301 Definitions.

As used in this subpart:

Decisional employee means the Administrator, Deputy Administrator,

FAA decisionmaker, hearing officer, or other FAA employee who is or who

may reasonably be expected to be involved in the decisional process of

the proceeding;

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.

Sec. 16.303 Prohibited ex parte communications.

(a) The prohibitions of this section shall apply from the time a

proceeding is noticed for hearing unless the person responsible for the

communication has knowledge that it will be noticed, in which case the

prohibitions shall apply at the time of the acquisition of such

knowledge.

(b) Except to the extent required for the disposition of ex parte

matters as authorized by law:

(1) No interested person outside the FAA make or knowingly cause to

be made to any decisional employee an ex parte communication relevant

to the merits of the proceeding;

(2) No FAA employee shall make or knowingly cause to be made to any

interested person outside the FAA an ex parte communication relevant to

the merits of the proceeding; or

(3) Ex parte communications regarding solely matters of agency

procedure or practice are not prohibited by this section.

Sec. 16.305 Procedures for handling ex parte communication

A decisional employee who receives or who makes or knowingly causes

to be made a communication prohibited by Sec. 16.303 shall place on the

public record of the proceeding:

(a) All such written communications;

(b) Memoranda stating the substance of all such oral

communications; and

(c) All written responses, and memoranda stating the substance of

all oral responses, to the materials described in paragraphs (a) and

(b) of this section.

Sec. 16.307 Requirement to show cause and imposition of sanction.

(a) Upon receipt of a communication knowingly made or knowingly

caused to be made by a party in violation of Sec. 16.303, the

Administrator or his designee or the hearing officer may, to the extent

consistent with the interests of justice and the policy of the

underlying statutes, require the party to show cause why his or her

claim or interest in the proceeding should not be dismissed, denied,

disregarded, or otherwise adversely affected on account of such

violation.

(b) The Administrator may, to the extent consistent with the

interests of justice and the policy of the underlying statutes

administered by the FAA, consider a violation of this subpart

sufficient grounds for a decision adverse to a party who has knowingly

committed such violation or knowingly caused such violation to occur.

Subpart J--Alternate Procedure for Certain Complaints Concerning

Airport Rates and Charges

Sec. 16.401 Availability of alternate procedure.

(a) A scheduled air carrier holding a certificate of public

convenience and necessity under 49 U.S.C. 1371, 1372, or 1388 or an

exemption from those sections under 14 CFR part 298, may bring a

complaint under this part using the procedures in this subpart.

(b) The procedures in this subpart are used only when all of the

following requirements are met:

(1) The complaint alleges that an increase in the fee charged by an

airport proprietor to scheduled air carriers is unreasonable within the

meaning of 49 U.S.C. 1513 (a) through (d), or is unreasonable or

unjustly discriminatory within the meaning of 49 U.S.C. 2210(c)(1);

(2) The Assistant Administrator, in his or her discretion,

determines that the complaint involves a matter which, if not resolved

by expedited procedure, may result in a substantial adverse impact on

air transportation or that determines that the complaint involves a

significant policy issue;

(3) The complaint meets the requirements for the filing of a

complaint set forth in subparts B and C of this part; and

(4) The complaint includes an express request that the complaint be

processed under this subpart.

(c) The Assistant Administrator may permit another air carrier

eligible to file a complaint under paragraphs (a) and (b) of this

section to join the complaint. A motion for joinder shall be filed on

or before the date the answer is due to be filed.

(d) Other than joinder of additional parties under paragraph (c) of

this section, participation in proceedings under this subpart by

persons other than complainants will be permitted only through the

filing of a written brief by a person with a substantial interest in

the proceeding at the discretion of the presiding officer before

issuance of the report of investigation, or by the Assistant

Administrator after issuance of the report. A person may file a motion

to submit a written brief to the presiding officer or the Assistant

Administrator, as appropriate.

Sec. 16.403 Answer and other documents.

(a) Within seven calendar days of receiving a complainant

requesting processing under this subpart, the Assistant Administrator

serves on the complainant and each person named in the complaint the

agency's determination whether the complaint--

(1) Meets the other requirements of this subpart; and

(2) Meets the requirements of subparts B and C of this part for the

filing of complaints.

(b) If the Assistant Administrator determines that the complaint

meets the requirements for a complaint under this subpart, each

respondent shall file an answer within 21 days of service of the

determination in paragraph (a) of this section.

(c) If the Assistant Administrator determines that the complaint

does not meet the requirements of this subpart but does meet the

requirements of subpart C of this part for the filing of a complaint,

the complaint will be processed under Sec. 16.29.

(d) The Assistant Administrator may dismiss a complaint as provided

in Secs. 16.25 and 16.27.

(e) The answer and all documents filed and served under this

subpart shall be filed and served by personal delivery. All other

requirements of subpart B of this part apply to the filing and service

of documents under this subpart.

(f) The Assistant Administrator may for good cause grant an

extension of the date by which the report of investigation is due.

Sec. 16.405 Notice and order of investigation.

Within seven days after the answer is served, the Assistant

Administrator issues a notice and order of investigation. The

investigation order states:

(a) The scope of the investigation, by describing the information

sought in terms of its subject matter or its relevance to specified

allegations;

(b) A description of the remedial or enforcement actions that may

be ordered in the event that a rate or charge is found to be useful,

including those provided in Sec. 16.109(a).

(c) Such rules of procedure as may be necessary to supplement this

part;

(d) The name and address of the presiding officer and the authority

delegated to the presiding officer to conduct the investigation in

accordance with the procedures set forth in this part;

(e) The date by which the presiding officer is directed to issue a

report of investigation, normally 60 days after filing of the answer.

Sec. 16.407 Presiding officer.

(a) The presiding officer is a person designated by the Assistant

Administrator who is neither an agency attorney, as defined in this

part, nor a person otherwise engaged in the investigation of airport

compliance.

(b) In accordance with the rules of this part, a presiding officer

may:

(1) Give notice of, and hold, prehearing conferences and

investigative hearings;

(2) Administer oaths and affirmations;

(3) Issue subpoenas authorized by law;

(4) Rule on offers of proof;

(5) Receive relevant and material evidence;

(6) Regulate the course of the hearing in accordance with the rules

of this part to avoid unnecessary and duplicative proceedings in the

interest of prompt and fair resolution of the matters at issue;

(7) Hold conferences to settle or to simplify the issues by consent

of the parties;

(8) Dispose of procedural motions and requests; and

(9) Examine witnesses.

(c) The presiding officer shall issue a report of investigation

which shall include findings of fact and, if directed by the Assistant

Administrator, proposed conclusions of law.

Sec. 16.409 Parties.

(a) Parties may appear as provided in Sec. 16.203(a) of this part.

(b) The parties to the investigation are the complainant(s), and

the respondent(s).

(c) The FAA is represented by an agency attorney who, for the

purposes of this part, will be deemed to be in the position of a party.

The function of the agency attorney is to assist in development of a

complete record for decision by the Assistant Administrator.

Sec. 16.411 Investigation procedure.

(a) Investigative hearing. The presiding officer shall hold an

evidentiary hearing to investigate the factual matters identified in

the investigative order. The hearing may be in person or,

alternatively, by oral argument following submission of documentary

evidence if the presiding officer determines that there are no genuine

issues of material fact that require oral examination of witnesses and

that documentary evidence in combination with oral argument is

sufficient to develop a complete record. Oral proceedings will be

transcribed and a transcript made available to the parties.

(b) Discovery. Discovery is limited to requests for admissions and

requests for production of documents. The presiding officer may--

(1) Require parties to submit discovery requests to the presiding

officer;

(2) Submit requests to the parties as modified by the presiding

officer in the interest of relevance, economy, and completeness of the

record for decision; and

(3) Require that responses be submitted to the presiding officer

with service on other parties.

(c) Witnesses. Consistent with paragraph (a), witnesses may be

designated and appear as provided in Secs. 16.217 and 16.221(a). The

presiding officer may exclude testimony as provided in Sec. 16.221(b).

(d) Subpoenas. Where necessary to ensure a complete record, the

presiding officer may issue a subpoena to compel a complainant or

respondent, or an officer, employee, or agent of a complainant or

respondent, to testify or to produce documents at the investigatory

hearing. Issuance of, service of, and motions regarding subpoenas shall

be in accordance with Sec. 16.219.

(e) Evidence. A party may offer direct and rebuttal evidence in

accordance with this section.

(1) Requirement for written testimony and evidence. Except in the

case of evidence obtained by subpoena, a party's direct and rebuttal

evidence, including testimony of witnesses, shall be submitted in

written form, in advance of any oral hearing pursuant to the schedule

established by the presiding officer. Written direct and rebuttal fact

testimony shall be certified by the witness as true and correct. Oral

examination of a party's own witness is limited to certification of the

accuracy of written evidence, including correction and updating, if

necessary, and redirect examination following cross-examination by

other parties.

(2) Cross-examination. A party may conduct cross-examination needed

for disclosure of the facts, subject to the control of the presiding

officer for fairness, expedition, and exclusion of extraneous matters.

(3) Admission of evidence. The presiding officer admits evidence in

accordance with this section, but may exclude irrelevant, immaterial,

privileged, or unduly repetitious evidence.

(4) Expert or opinion witnesses. An employee of the FAA or DOT may

not be called as an expert or opinion witness for any party other than

the agency except as provided in Department of Transportation

regulations at 49 CFR part 9.

(f) Public disclosure of evidence. Proceedings under this part are

open to the public. Evidence is disclosed or withheld from public

disclosure as provided in Sec. 16.225. Objections to public disclosure

may be filed with and ruled on by the presiding officer.

(g) Location of hearing. The investigative hearing shall be

conducted at a place or places designated by the presiding officer with

due regard for the convenience of the parties and the expeditious and

efficient handling of the investigation.

(h) Offer of proof. A party whose evidence has been excluded by a

ruling of the presiding officer may make an offer of the proof to be

included in the record.

(i) Exclusive record. The pleadings, transcript of the hearing, all

exhibits received into evidence, all motions, applications, requests

and rulings, and all documents included in the hearing record shall

constitute the exclusive record for the report of investigation.

(j) Argument before the presiding officer. During the hearing, the

presiding officer shall give the parties reasonable opportunity to

present oral argument on the record supporting or opposing motions,

objections, and rulings. In addition, the presiding officer may permit

oral argument on the merits of the case. The presiding officer may

request the parties to submit proposed findings of fact and conclusions

of law.

Sec. 16.413 Report of investigation.

(a) On or before the date set in the notice and order of

investigation, the presiding officer shall issue a written report of

investigation based on the record developed during the investigation.

The report shall include a concise summary of the evidence and findings

of fact and, if directed by the Assistant Administrator, conclusions of

law, on the issues set forth in the order of investigation.

(b) The presiding officer shall transmit the report of

investigation and the record to the Assistant Administrator.

(c) The presiding officer shall file the report of investigation in

the Enforcement Docket and serve copies on the parties.

Sec. 16.415 Initial determination.

(a) Within 120 days after the complaint is filed, unless extended

by the Assistant Administrator upon agreement of all the parties, the

Assistant Administrator will render an initial determination and serve

it on each party by certified mail, return receipt requested, or

personal delivery.

(b) The initial determination will set forth a concise explanation

of the factual and legal basis for the Assistant Administrator's

determination on each claim made by the complainant.

(c) A party adversely affected by the initial determination may

appeal the initial determination as provided in Sec. 16.31(c) or

16.31(d).

Sec. 16.417 Eligibility for grants pending final agency decision.

(a) Suspension of eligibility. If the initial determination under

Sec. 16.415 is that the challenged increase in rates and charges is

unreasonable or unjustly discriminatory, the respondent's eligibility

to receive new Airport Improvement Program grants under the AAIA and to

receive payments under existing grants is suspended effective 30 days

after the issuance of the initial determination, unless the respondent

files a notice of resolution of complaint or a notice of rescission

under this section.

(b) Rescission of increase. The suspension of eligibility is

deferred if, within 30 days after service of the initial determination,

the respondent does one of the following--

(1) Rescinds the increase in rates or charges. To implement the

rescission for purposes of this part, the respondent shall file a

notice of rescission in the Enforcement Docket and serve a copy on each

party.

(2) Resolves the dispute through agreement with other parties,

subject to the concurrence of the Assistant Administrator. The

respondent shall indicate resolution by the filing of a joint motion

for dismissal and for withdrawal of the complaint in the Enforcement

Docket. In exercising discretion whether to grant the motion, the

Assistant Administrator will consider, among other things, whether all

parties have joined the motion and the effect of the proposed

resolution on non-party aeronautical users of the airport.

(c) Deferral of the suspension of eligibility for grants and grant

payments under this section does not limit the FAA's authority to

impose any sanction or remedy for the past or continuing imposition of

an unreasonable or unjustly discriminatory fee, including ordering

refund with interest of fees paid prior to the effective date of the

order.

(d) Notwithstanding the provision for suspension of eligibility in

paragraph (a) of this section, the Assistant Administrator may execute

a grant agreement or approve payment under an existing grant if

necessary to correct or prevent an unsafe condition.

Issued in Washington, DC, on June 3, 1994.

Federico Pena,

Secretary of Transportation.

David R. Hinson,

Administrator, Federal Aviation Administration.

[FR Doc. 94-13942 Filed 6-6-94; 12:42 pm]

BILLING CODE 4910-13-M