0006 Ss 110511

Supporting Statement
30 CFR Part 1243
Suspensions Pending Appeal and Bonding—
Office of Natural Resources Revenue
(Forms ONRR-4435, ONRR-4436, and ONRR-4437)
OMB Control Number 1012-0006
Current Expiration Date: November 30, 2011
Terms of clearance: None.
General Instructions

A Supporting Statement, including the text of the notice to the public required by 5 CFR
1320.5(a)(i)(iv) and its actual or estimated date of publication in the Federal Register, must
accompany each request for approval of a collection of information. The Supporting Statement
must be prepared in the format described below, and must contain the information specified in
Section A below. If an item is not applicable, provide a brief explanation. When statistical
methods are employed, Section B of the Supporting Statement must be completed. The Office of
Management and Budget (OMB) reserves the right to require the submission of additional
information with respect to any request for approval.
Specific Instructions

1. Explain the circumstances that make the collection of information necessary. Identify any
legal or administrative requirements that necessitate the collection.
The Secretary of the U.S. Department of the Interior is responsible for collecting royalties from
lessees who produce minerals from leased Federal and Indian lands. The Secretary is required
by various laws (see below) to manage mineral resources production on Federal and Indian
lands, collect the royalties due, and distribute the funds in accordance with those laws. The
Secretary also has a trust responsibility to manage Indian lands and seek advice and information
from Indian beneficiaries. The Office of Natural Resources Revenue (ONRR), formerly the
Minerals Revenue Management (MRM), a program of the former Minerals Management Service
(MMS), performs the minerals revenue management functions for the Secretary and assists the
Secretary in carrying out the Department’s trust responsibility for Indian lands.
Applicable citations of the laws pertaining to mineral leases include the following:






Mineral Leasing Act of 1920 (30 U.S.C. 1923)
Outer Continental Shelf Lands Act (43 U.S.C. 1353)
Federal Oil and Gas Royalty Management Act of 1982 (FOGRMA) (Pub. L. 97-451—
Jan. 12, 1983)
Federal Oil and Gas Royalty Simplification and Fairness Act of 1996 (RSFA) (Pub. L. 104185—Aug. 13, 1996, as corrected by Pub. L. 104-200—Sept. 22, 1996)
Indian Mineral Development Act of 1982 (Pub. L. 97-382—Dec. 22, 1982)

1

2. Indicate how, by whom, and for what purpose the information is to be used. Except for a
new collection, indicate the actual use the agency has made of the information received from
the current collection. Be specific. If this collection is a form or a questionnaire, every
question needs to be justified.
Stay of Payment Pending Appeal
Section 4(l), “Stay of Payment Obligation Pending Review,” of RSFA requires ONRR to
evaluate any person, ordered by the Secretary or a delegated state to pay any obligation (other
than an assessment) subject to RSFA, to determine whether that person is entitled to a stay of the
order without bond or other surety instrument, pending an administrative or judicial proceeding,
based on the financial solvency of that person.
Implementing regulations at 30 CFR part 1243 govern the suspension of orders or decisions
pending administrative appeal for Federal leases. These regulations require an appellant to
submit information demonstrating financial solvency in lieu of providing a surety. For those
appellants who are not financially solvent or for appeals involving Indian leases, ONRR requires
appellants to post a surety instrument to secure the financial interest of the public and Indian
lessors during the entire administrative or judicial appeal process. This information collection
request (ICR) covers the burden hours appellants incur when submitting the financial statements
or surety instruments subject to annual audit that are required to stay an ONRR order.
Appellants may refer to the Surety Instrument Posting Instructions for each of the five surety
types to submit the respective information. These instructions for the five surety types discussed
below also are found at http://www.onrr.gov/FM/PDFDocs/SuretyInst.pdf.
Forms and Other Surety Types
Under Title 30 CFR part 1243, ONRR suspends the payment requirement if the appellant
submits a formal agreement of payment in case of default, such as a bond or other surety, or
demonstrates financial solvency while the appeal is pending. We accept five surety types.
Form ONRR-4435, Administrative Appeal Bond
A Form ONRR-4435, Administrative Appeal Bond, is issued by a qualified surety company that
is approved by the Department of the Treasury [see Department of the Treasury Circular
No. 570, as revised periodically in the Federal Register].
Form ONRR-4436, Letter of Credit
A Form ONRR-4436, Letter of Credit (LOC), is notarized and issued for an appellant by a bank
with a minimum Fitch rating of “C” for a LOC of less than $1 million; “B/C” for a LOC between
$1 million and $10 million; or “B” for a LOC over $10 million. A Fitch rating is a bank rating
provided by Fitch, Inc., and is available at http://www.fitchratings.com. The LOC must have a
minimum coverage period of 1 year and be automatically renewable for up to 5 years.

2

Form ONRR-4437, Assignment of Certificate of Deposit
A Form ONRR-4437, Assignment of Certificate of Deposit, is issued by a bank with a minimum
required Fitch rating or is confirmed by a bank with an acceptable rating. The acceptable ratings
for a CD are the same as for a LOC. An appellant must file a request with ONRR prior to the
invoice due date. We will accept only a book-entry CD that explicitly assigns the CD to the
Director.
Self-bonding
For Federal oil and gas leases, RSFA Section 4(l), as codified at 30 CFR 1243.201, provides that
no surety instrument is required when a person representing the appellant periodically
demonstrates, to the satisfaction of ONRR, that the guarantor or appellant is financially solvent
or otherwise able to pay the obligation. Appellants must submit a written request to “self-bond”
every time a new appeal is filed. To evaluate the financial solvency and exemption from
requirements of appellants to maintain a surety related to an appeal, ONRR requires appellants to
submit a consolidated balance sheet, subject to annual audit. In some cases, ONRR also requires
copies of the most recent tax returns (up to 3 years) filed by appellants.
In addition, appellants must submit annually financial statements, subject to annual audit, to
support their net worth. We use the consolidated balance sheet or business information supplied
to evaluate the financial solvency of a lessee, designee, or payor seeking a stay of payment
obligation pending review. If appellants do not have a consolidated balance sheet documenting
their net worth or if they do not meet the $300 million net worth requirement, ONRR selects a
business information or credit reporting service to provide information concerning an appellant’s
financial solvency. We charge the appellant a $50 fee each time we need to review data from a
business information or credit reporting service. The fee covers our costs to determine an
appellant’s financial solvency.
U.S. Treasury Securities
Appellants may choose to secure their debts by requesting to use a U.S. Treasury Security (TS).
Appellants must file the letter of request with ONRR prior to the invoice due date. The TS must
be a U.S. Treasury note or bond with maturity equal to or greater than 1 year. The TS must
equal 120 percent of the appealed amount plus 1 year of estimated interest (necessary to protect
ONRR against interest rate fluctuations). We accept only a book-entry TS. Book-entry
securities are securities that are recorded in electronic records rather than as paper certificates.
When an appellant selects one of the surety types and puts it in place, the appellant must
maintain the surety until completion of the appeal. If the appeal is decided in favor of the
appellant, ONRR returns the surety to the appellant. If the appeal is decided in favor of ONRR,
then ONRR may take action to collect full royalty payment or draw down on the surety. We
draw down on a surety if the appellant fails to pay or fails to comply with requirements relating
to amount due, time frame, or surety submission or resubmission. Whenever ONRR must draw
down on a surety, we must draw down the total amount due, which is defined as unpaid principal
plus the interest accrued to the projected receipt date of the surety payment.

3

3. Describe whether, and to what extent, the collection of information involves the use of
automated, electronic, mechanical, or other technological collection techniques or other forms
of information technology, e.g., permitting electronic submission of responses, and the basis
for the decision for adopting this means of collection. Also describe any consideration of
using information technology to reduce burden and specifically how this collection meets
GPEA requirements.
Our Government Paperwork Elimination Act plan indicates that electronic transmission of this
information is not practical because the bonding and banking industry requires submission of
original signature documents if draw-down is necessary. For the same reason (original signature
requirements), an electronic or telefax copy of Forms ONRR-4435, ONRR-4436, and
ONRR-4437 is not acceptable. For self-bonding, we accept a letter of request and the
consolidated balance statements from appellants by electronic means or telefax copy. We expect
approximately 5 percent of the appellants for self-bonding will use the electronic means or
telefax. We offer an electronic copy of these forms on our website at
http://www.onrr.gov/FM/Forms/default.htm, which lessees may print and complete.
4. Describe efforts to identify duplication. Show specifically why any similar information
already available cannot be used or modified for use for the purposes described in Item 2
above.
The minimum required surety for Federal leases is $10,000, and the minimum required surety for
Indian leases is $1,000. For sureties at or below the minimums, ONRR uses existing ONRR,
Bureau of Land Management, and Bureau of Indian Affairs lease bonds to secure the debts
during appeal; therefore, there is no duplication.
For appealed amounts above the minimums, ONRR requires one of the five surety types listed in
Item 2 to be in place. The information we collect for those surety types is unique to each
appellant and is necessary for ONRR to properly secure the disputed debt. No other agency
collects similar information from lessees, designees, payors, appellants, or guarantors.
5. If the collection of information impacts small businesses or other small entities, describe
any methods used to minimize burden.
Small businesses that do not have consolidated balance statements may request exemption from
requirements to maintain a surety bond related to their appeal under the self-bonding option.
Under this option, their credit information is accessed through a business information or credit
reporting service selected by ONRR. We charge a processing fee of $50 for this review. If these
small businesses do not wish their credit information to be accessed, they have the option to post
any of the other surety types listed in Item 2, or pay the appealed bill under protest in lieu of selfbonding. We provide a variety of options for small businesses to secure the public’s interests
when appeals are made. The impact is minimal for any option a small business might choose.

4

6. Describe the consequence to Federal program or policy activities if the collection is not
conducted or is conducted less frequently, as well as any technical or legal obstacles to
reducing burden.
If ONRR does not collect the information needed for self-bonding and other surety types, the
appellants cannot obtain the surety or self-bond as allowed under RSFA section 4(l). Without
self-bonding, ONRR then would require sureties for each appeal, and appellants would incur the
expense of supplying and maintaining sureties for every appeal. Without other surety types,
ONRR would require an appellant to pay the royalty amounts due pending appeals. We cannot
reduce the burden below an annual filing for surety relief because the financial status of
appellants changes from year to year. We must be able to monitor an appellant’s ability to pay
disputed amounts in order to protect the public’s interest in the minerals removed from Federal
and Indian land.
7. Explain any special circumstances that would cause an information collection to be
conducted in a manner:
(a) requiring respondents to report information to the agency more often than quarterly.
There is no requirement to report more often than quarterly for self-bonding and other surety
types. Title 30 CFR part 1243 requires that the respondent/appellant must submit annually
information needed to determine financial solvency, or submit on occasion an ONRR-specified
surety instrument within a time period ONRR prescribes in an order. In addition, we require the
appellant to renew annually the ONRR-specified surety instrument for continuation of pending
an appeal.
(b) requiring respondents to prepare a written response to a collection of information in
fewer than 30 days after receipt of it.
Not applicable in this collection.
(c) requiring respondents to submit more than an original and two copies of any
document.
Not applicable in this collection.
(d) requiring respondents to retain records, other than health, medical, government
contract, grant-in-aid, or tax records, for more than 3 years.
Under 30 U.S.C. 1713(b), lessees must maintain Indian oil and gas records for 6 years after the
records are generated unless the Secretary notifies the record holder that such records must be
maintained for a longer period due to an ongoing audit or investigation. Under 30 CFR
1212.200 an appellant must maintain records for 6 years or for longer periods if notified in
writing. When an audit or investigation is underway, an appellant must maintain records until
released by written notice.

5

For Federal records, RSFA section 4(f) requires that Federal lessees maintain records for 7 years
after the obligation becomes due.
(e) in connection with a statistical survey, that is not designed to produce valid and reliable
results that can be generalized to the universe of study.
Not applicable in this collection.
(f) requiring the use of statistical data classification that has been reviewed and approved
by OMB.
There are no special circumstances with respect to 5 CFR 1320.5(d)(2)(v) through (viii), as the
collection is not a statistical survey and does not use statistical data classification.
(g) that includes a pledge of confidentiality that is not supported by authority established
in statute or regulation, that is not supported by disclosure and data security policies that are
consistent with the pledge, or which unnecessarily impedes sharing of data with other
agencies for compatible confidential use.
This collection does not include a pledge of confidentiality not supported by statute or
regulation.
(h) requiring respondents to submit proprietary trade secrets or other confidential
information unless the agency can demonstrate that it has instituted procedures to protect the
information’s confidentiality to the extent permitted by law.
Appellants are required to provide confidential/proprietary information to us to bond using the
surety types listed in Item 2. Standard agency procedures provide strict security measures to
control the use, storage, and access to such information. We protect the information in
accordance with standards identified in Item 10 below.
8. If applicable, provide a copy and identify the date and page number of publication in the
Federal Register of the agency's notice, required by 5 CFR 1320.8(d), soliciting comments on
the information collection prior to submission to OMB. Summarize public comments received
in response to that notice and in response to the PRA statement associated with the collection
over the past 3 years, and describe actions taken by the agency in response to these comments.
Specifically address comments received on cost and hour burden.
Describe efforts to consult with persons outside the agency to obtain their views on the
availability of data, frequency of collection, the clarity of instructions and recordkeeping,
disclosure, or reporting format (if any), and on the data elements to be recorded, disclosed, or
reported.
Consultation with representatives of those from whom information is to be obtained or those
who must compile records should occur at least once every three years — even if the collection
of information activity is the same as in prior periods. There may be circumstances that may

6

preclude consultation in a specific situation. These circumstances should be explained.
As required in 5 CFR 1320.8(d), ONRR published a 60-day review and comment notice in the
Federal Register. We did not receive any comments in response to this notice, published on
May 4, 2011 (76 FR 25367).
We also contacted three producers (listed below) regarding the burden hour estimates and the
clarity of the regulations requiring this collection of information. Program staff reported the
following:
Contacts made / comments received:
Gregory Steele
Chesapeake Operating
PO Box 18496
Oklahoma City OK 73154-0496
405-935-8493
Mr. Steele feels that our regulations are very clear and the forms and instructions are very easy
to understand. He also mentioned that he appreciates the notification that he receives
regarding required increases for continued compliance during the appeals process.
Kathy Zievert
Chevron USA Inc
4800 Fournace Place
Bellaire Office Building
Bellaire TX 77401
713-432-6412
Had no suggestions for improvements. Feels that the burden hours are fairly represented.
Feels that our instructions and regulations are clear.
From Mary Holman, ExxonMobil: [email protected]:

The forms and regs are clear and easy enough to understand but sometimes, ONRR does not
include bonding instructions with all Notices of Demands, interest bills. RIK Cashout requests
etc with which we disagree. I would suggest that ONRR begin include bonding instructions and
appeal instructions too with these types of communications.
Because our increasing controls at ExxonMobil, it does take more time to submit both a surety
and a request to self-bond.
Previously, any member of the Audit Coordination group was able to submit a request to selfbond which basically was a letter request to you to allow us to self-bond for a demand. We
have added additional controls internally at ExxonMobil requiring a manager with a higher
approval level to sign the letter. With preparation time, required review with management,
mailing prep, etc. the time to submit a request to self-bond has increased to an estimated 2
hours.

7

Requesting a 3rd party bond has and will continue to take more time than a self-bond request.
We have to fill out form to the surety company, request the bond (either by email or US mail
letter), follow-up on the bond request, receive the bond and obtain the correct manager
signature on the bond form, prepare a letter to you submitting the bond. With mailing etc. the
time for these is estimated 4 hours. (Luckily, we have few Indians leases left.)
Mr. James L. Connor III
Senior Counsel
El Paso Exploration & Production Company
[email protected]
No comments received from Mr. James Connor.
Mr. Dave Lomax
Exxon Mobil Corporation
[email protected]
No comments received from Mr. Dave Lomax.
Ms. Stevia M. Walther
Senior Counsel
Negotiations and Legal
Chevron North America Exploration and Production Company,
a Division of Chevron U.S.A. Inc.
[email protected]
No comments received from Ms. Stevia Walther.

We accept comments at any time on the information collection and the burden hour estimates, as
explained in the PRA statement at the bottom of each form. We have not received any
comments on the forms. Based on ExxonMobile comments from Mary Holman, we are revising
our burden hour estimates. The ONRR also maintains regular, ongoing contact with appellants.
We provide toll-free telephone assistance and encourage customer feedback as we respond to
questions regarding requirements. We address issues as they come up and continually improve
our processes.
9. Explain any decision to provide any payment or gift to respondents, other than
remuneration of contractors or grantees.
The ONRR will not provide any payment or gift to respondents.
10. Describe any assurance of confidentiality provided to respondents and the basis for the
assurance in statute, regulation, or agency policy.
This information collection contains confidential information. Information obtained through a
third-party business information or credit reporting service, or through surety providers is
considered proprietary and, therefore, will not be released.

8

Commercial or financial information provided to ONRR relative to minerals removed from
Federal and Indian leases may be proprietary. Trade secrets and proprietary and other
information are protected in accordance with standards established by FOGRMA, as amended
(30 U.S.C. 1733), and the Freedom of Information Act [5 U.S.C. 552(b)(4)] and Department
regulations (43 CFR 2).
In addition, the Indian Mineral Development Act of 1982 (25 U.S.C. 2103) provides that all
information related to any Indian minerals agreement covered by the Act in the possession of the
Department shall be held as privileged proprietary information.
Storage of proprietary information and access to it are controlled by strict security measures.
ONRR stores security instruments in a Government-approved safe with access limited to the
ONNR bond-approving officer.
11. Provide additional justification for any questions of a sensitive nature, such as sexual
behavior and attitudes, religious beliefs, and other matters that are commonly considered
private. This justification should include the reasons why the agency considers the questions
necessary, the specific uses to be made of the information, the explanation to be given to
persons from whom the information is requested, and any steps to be taken to obtain their
consent.
This information collection does not include sensitive or private questions.
12. Provide estimates of the hour burden of the collection of information. The statement
should:
(a) Indicate the number of respondents, frequency of response, annual hour burden, and
an explanation of how the burden was estimated. Unless directed to do so, agencies should
not conduct special surveys to obtain information on which to base hour burden estimates.
Consultation with a sample (fewer than 10) of potential respondents is desirable. If the hour
burden on respondents is expected to vary widely because of differences in activity, size, or
complexity, show the range of estimated hour burden, and explain the reasons for the
variance. Generally, estimates should not include burden hours for customary and usual
business practices.
(b) If this request for approval covers more than one form, provide separate hour burden
estimates for each form and aggregate the hour burdens.
(c) Provide estimates of annualized cost to respondents for the hour burdens for
collections of information, identifying and using appropriate wage rate categories. The cost of
contracting out or paying outside parties for information collection activities should not be
included here. Instead, this cost should be included in Item 14.
There are approximately 105 appellants (Federal/Indian lessees) annually. We receive responses
annually and throughout the calendar year as appeals are filed. We estimate that there will be

9

40 surety instruments and 65 self-bonding submissions each year. We estimate the total annual
burden is 210 reporting hours, based on 2 hours per response.
Summary of Information Collections
Information Collections
(and CFR Reference)

Securities
 Form ONRR-4435
 Form ONRR-4436
 Form ONRR-4437
 Treasury Securities
30 CFR 1243.4(a)(1)
Self Bonding
30 CFR 1243.200(a) and (b)

Requirement to
Respond
Required
to obtain a
benefit

Frequency
of
Response
On occasion

Required
to obtain a
benefit

Annually

TOTAL

Number
of Annual
Responses
40

Annual
Burden
Hours
80

65

130

105

210

We based our cost estimates for industry on the expectation that a lawyer will perform all
requirements. We estimate the total annual reporting burden is 210 hours. We estimated the
labor cost based on Bureau of Labor Statistics National Occupational Employment and Wage
Estimates for industry lawyers. We used a multiplier of 1.4 for benefits. The estimated labor
cost per hour is $87 ($62.23 [mean hourly wage] x 1.4 [benefits cost factor]).
Additionally, for approximately five of the self-bonding appellants, ONRR must obtain data
from a business information or credit reporting service at a cost of $50 each to these appellants.
The total cost for obtaining this data is $250.
The total estimated cost to industry is $18,520 ($87 [labor cost] x 210 [burden hours] = $18,270
+ $250 [credit reporting service] = $18,520).
There are no additional recordkeeping costs associated with this information collection. We
have not included in our estimates certain requirements performed in the normal course of
business and considered usual and customary. The following table shows the estimated burden
hours by CFR section and paragraph.

10

BURDEN BREAKDOWN
Citation
30 CFR
Part 1243
1243.4(a)(1)

1243.6

1243.7(a)

1243.8(a)(2)
and (b)(2)

Reporting and Recordkeeping
Requirement

Hour
Burden

How do I suspend compliance with an
order?
(a) If you timely appeal an order, and if that
order or portion of that order: (1) Requires
you to make a payment, and you want to
suspend compliance with that order, you
must post a bond or other surety
instrument or demonstrate financial
solvency * * *.
When must I or another person meet the
bonding or financial solvency
requirements under this part?
If you must meet the bonding or financial
solvency requirements under
§1243.4(a)(1), or if another person is
meeting your bonding or financial solvency
requirements, then either you or the other
person must post a bond or other surety
instrument or demonstrate financial
solvency within 60 days after you receive
the order or the Notice of Order.
What must a person do when posting a
bond or other surety instrument or
demonstrating financial solvency on
behalf of an appellant?
If you assume an appellant’s responsibility
to post a bond or other surety instrument or
demonstrate financial solvency * * * (a)
Must notify ONRR in writing * * * that you
are assuming the appellant’s responsibility
* * *.
When will ONRR suspend my obligation
to comply with an order?
(a) Federal leases. * * * (2) If the amount
under appeal is $10,000 or more, ONRR
will suspend your obligation to comply with
that order if you:
(i) Submit an ONRR-specified surety
instrument under subpart B of this part
within a time period ONRR prescribes; or
(ii) Demonstrate financial solvency under
subpart C.
(b) Indian leases. * * * (2) If the amount
under appeal is $1,000 or more, ONRR will
suspend your obligation to comply with that
order if you submit an ONRR-specified
surety instrument under subpart B of this
part within a time period ONRR prescribes.

2 hours

11

Average
Number of
Annual
Responses
40
(Forms
ONRR-4435,
ONRR-4436,
ONRR-4437,
or TS)

Annual
Burden
Hours

Burden hours covered under
§1243.4(a)(1).

Burden hours covered under
§1243.4(a)(1).

Burden hours covered under
§1243.4(a)(1).

80

Citation
30 CFR
Part 1243
1243.101(b)

1243.200(a)
and (b)

1243.201
(c)(1),
(c)(2)(i) and
(c)(2)(ii)
and (d)(2)

Reporting and Recordkeeping
Requirement
How will ONRR determine the amount of
my bond or other surety instrument?
* * * (b) If your appeal is not decided within
1 year from the filing date, you must
increase the surety amount to cover
additional estimated interest for
another 1-year period. You must continue
to do this annually * * *.
How do I demonstrate financial
solvency?
(a) To demonstrate financial solvency
under this part, you must submit an audited
consolidated balance sheet, and, if
requested by the ONRR bond-approving
officer, up to 3 years of tax returns to the
ONRR, * * *.
(b) You must submit an audited
consolidated balance sheet annually, and,
if requested, additional annual tax returns
on the date ONRR first determined that you
demonstrated financial solvency as long as
you have active appeals, or whenever
ONRR requests. * * *
How will ONRR determine if I am
financially solvent?
* * * (c) If your net worth, minus the amount
we would require as surety under subpart B
for all orders you have appealed is less
than $300 million, you must submit * * *:
(1) A written request asking us to consult a
business-information, or credit-reporting
service or program to determine your
financial solvency; and
(2) A nonrefundable $50 processing fee:
(i) You must pay the processing fee
* * *;
(ii) You must submit the fee with your
request * * * and then annually on the date
we first determined that you demonstrated
financial solvency, as long as you are not
able to demonstrate financial solvency * * *
and you have active appeals.
(d)* * * (2) For us to consider you financially
solvent, the business-information or credit–
reporting service or program must
demonstrate your degree of risk as low to
moderate: * * *

12

Average
Annual
Number of
Burden
Annual
Hours
Responses
Burden hours covered under
§1243.4(a)(1).
Hour
Burden

2 hours

65
(self-bonding
submissions)

Burden hours covered under
§§1243.4(a)(1) and 1243.200(a)
and (b).

130

Citation
30 CFR
Part 1243
1243.202(c)

Reporting and Recordkeeping
Requirement

Average
Annual
Number of
Burden
Annual
Hours
Responses
Burden hours covered under
§1243.4(a)(1).
Hour
Burden

When will ONRR monitor my financial
solvency?
* * * (c) If our bond-approving officer
determines that you are no longer
financially solvent, you must post a bond or
other ONRR-specified surety instrument
under subpart B.
TOTAL BURDEN

105

210

13. Provide an estimate of the total annual [non-hour] cost burden to respondents or
recordkeepers resulting from the collection of information. (Do not include the cost of any
hour burden shown in Items 12 and 14).
(a) The cost estimate should be split into two components: (1) a total capital and start-up
cost component (annualized over its expected useful life) and (2) a total operation and
maintenance and purchase of services component. The estimates should take into account
costs associated with generating, maintaining, and disclosing or providing the information
[including filing fees paid]. Include descriptions of methods used to estimate major cost
factors including system and technology acquisition, expected useful life of capital equipment,
the discount rate(s), and the time period over which costs will be incurred. Capital and startup costs include, among other items, preparations for collecting information such as
purchasing computers and software; monitoring, sampling, drilling and testing equipment;
and record storage facilities.
(b) If cost estimates are expected to vary widely, agencies should present ranges of cost
burden and explain the reasons for the variance. The cost of purchasing or contracting out
information collection services should be a part of this cost burden estimate. In developing
cost burden estimates, agencies may consult with a sample of respondents (fewer than 10),
utilize the 60-day pre-OMB submission public comment process and use existing economic or
regulatory impact analysis associated with the rulemaking containing the information
collection, as appropriate.
(c) Generally, estimates should not include purchases of equipment or services, or portions
thereof, made: (1) prior to October 1, 1995, (2) to achieve regulatory compliance with
requirements not associated with the information collection, (3) for reasons other than to
provide information or keep records for the government, or (4) as part of customary and usual
business or private practices.
We collect a processing fee of $50 each time we must consult a business information or credit
reporting service for appellants who cannot comply with the consolidated balance sheet
requirement, or for a publicly traded company that does not meet our established net worth of
$300 million. We estimate that five of the self-bonding appellants will file this fee of $50.
Therefore, the total estimated “non-hour” cost to these five appellants for payment of fees is
$250 (5 x $50 = $250).

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14. Provide estimates of annualized cost to the Federal Government. Also, provide a
description of the method used to estimate cost, which should include quantification of hours,
operational expenses (such as equipment, overhead, printing, and support staff), and any
other expense that would not have been incurred without this collection of information.
Our estimate of the time required by a Federal employee to analyze and review the information
has not changed. The Federal Government spends an average of 1 hour for each type of surety
instrument (approximately 1 hour per instrument). In addition, the Federal Government spends
1 hour reviewing data inquiries from a business information or credit reporting service for
appellants. The Federal Government also consults a business information or credit reporting
service for all small entities or non-publicly traded companies that cannot comply with the
consolidated balance sheet requirement, or for a publicly traded company that does not meet our
requirement of an established net worth of $300 million. These tasks are currently performed by
an employee paid at the United States 2011 General Schedule, Grade 13/Step 4 pay-scale level.
The 2011 salary tables for the Denver, Colorado, area are located at
http://www.opm.gov/oca/11tables/html/den_h.asp. The GS 13/4 pay-scale level at $46.28 per
hour times the 1.5 multiplier for benefits equals $69.42, rounded to $69 per hour.
The estimated annual cost to the Federal Government is $7,590 (105 surety requests x 1 hour per
surety = 105 hours x $69 per hour [GS-13/4] = $7,245 + 5 data inquiries x 1 hour = 5 hours x
$69 = $345).
15. Explain the reasons for any program changes or adjustments in hour or cost burden.
(a) Annual Hour Burden
Currently Approved
OMB Burden Hour
Inventory

Program Change
Estimated
Burden Hours

Adjustment Change
Estimated
Burden Hours

Total
Estimated
Burden Hours

140

0

70

210

We are requesting an adjustment increase of 70 hours. Examination of our files showed an
annual average of 35 fewer responses, but we increased the burden hours per response, based on
customer feedback.
(b) Annual Cost Burden
There is an estimated cost burden of $250 to recover our costs in determining the financial
solvency of an estimated five appellants. We charge the appellant a $50 fee each time we need
to review data from a business information or credit reporting service. This fee has not changed.
16. For collections of information whose results will be published, outline plans for
tabulation and publication. Address any complex analytical techniques that will be used.
Provide the time schedule for the entire project, including beginning and ending dates of the
collection of information, completion of report, publication dates, and other actions.
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The ONRR will not publish the data.
17. If seeking approval not to display the expiration date for OMB approval of the
information collection, explain the reasons that display would be inappropriate.
The ONRR will display the OMB approval expiration date on Forms ONRR-4435, ONRR-4436,
and ONRR-4437. The remainder of this collection concerns regulatory requirements.
18. Explain each exception to the topics of the certification statement identified in
"Certification for Paperwork Reduction Act Submissions."
To the extent that the topics apply to this collection of information, we are not making any
exceptions to the “Certification for Paperwork Reduction Act Submissions.”

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