PHMSA Issues Pipeline Damage Prevention Final Rule

July 16, 2015 § Leave a comment

Excavation damage by third-parties has resulted in 757 injuries and $545 million in property damage from 1,815 pipeline incidents between 1988 and 2014   As the Pipeline and Hazardous Materials Safety Administration (PHMSA) has concluded that “[e]xcavation damage poses by far the single greatest threat to distribution system safety, reliability, and integrity.”  Often the responsible parties have faced little or no enforcement, because damage prevention has been handled by the states and not the federal government.  Some states have chosen to allow numerous exemptions to the damage prevention laws; in some cases protecting the most frequent parties causing the damage to pipelines.  State practices have been inconsistent, with many states lacking the resources for robust enforcement of their damage prevention statutes.

This long-awaited final rule may begin to resolve this problem. Although the process is expected to take some time to roll out, PHMSA’s evaluation of state programs should lead to increased enforcement against excavators who fail to use the one-call system and penalize states with cuts to grant funding for failure to adequately protect underground facilities through comprehensive damage prevention programs. The PIPES Act of 2006 directed PHMSA to develop criteria to evaluate the adequacy of state damage prevention programs and authorized PHMSA to civil enforcement action against excavators who violate safety requirements.

The final rule, announced July 15, amends the Federal pipeline safety regulations to establish the following:

  • The criteria and procedures PHMSA will use to determine the adequacy of State pipeline excavation damage prevention law enforcement programs;
  • The administrative process for States to contest notices of inadequacy from PHMSA should they elect to do so;
  • The Federal requirements PHMSA will enforce against excavators for violations in States with inadequate excavation damage prevention law enforcement programs; and
  • The adjudication process for administrative enforcement proceedings against excavators where Federal authority is exercised.

The criteria PHMSA will use to evaluate the adequacy of State damage prevention law enforcement programs, listed in § 198.55 are:

1) Does the State have the authority to enforce its State excavation damage prevention law using civil penalties and other appropriate sanctions for violations?

2)  Has the State designated a State agency or other body as the authority responsible for enforcement of the State excavation damage prevention law?

3)  Is the State assessing civil penalties and other appropriate sanctions for violations at levels sufficient to deter noncompliance and is the State making publicly available information that demonstrates the effectiveness of the State’s enforcement program?

4)  Does the enforcement authority (if one exists) have a reliable mechanism (e.g., mandatory reporting, complaint-driven reporting) for learning about excavation damage to underground facilities?

5)  Does the State employ excavation damage investigation practices that are adequate to determine the responsible party or parties when excavation damage to underground facilities occurs?

6)  At a minimum, do the State’s excavation damage prevention requirements include the following:

A.    Excavators may not engage in excavation activity without first using an available one-call notification system to establish the location of underground facilities in the excavation area.

B.    Excavators may not engage in excavation activity in disregard of the marked location of a pipeline facility as established by a pipeline operator

C    An excavator who causes damage to a pipeline facility

  1. Must report the damage to the operator of the facility at the earliest
  2. practical moment following discovery of the damage; and
  3. If the damage results in the escape of any PHMSA regulated natural and other gas or hazardous liquid, must promptly report to other appropriate authorities by calling the 911 emergency telephone number or another emergency telephone number.

7)  Does the State limit exemptions for excavators from its excavation damage prevention law? A State must provide to PHMSA a written justification for any exemptions for excavators from State damage prevention requirements. PHMSA will make the written justifications available to the public.

PHMSA’s evaluation will involve all of the criteria, and the final determination will be based on the totality of the review. PHMSA may declare a State enforcement program inadequate if the State’s program does not satisfy a combination of the criteria as described above. PHMSA will notify in writing the Governor’s office or other appropriate State authority of a State deemed to have an inadequate enforcement program.  States that PHMSA deems to have inadequate enforcement programs may be subject to reductions in pipeline safety grant funding. PHMSA will use the existing process for calculating base grants but is considering a policy that would incorporate and/or substitute the evaluation criteria in § 198.55 for the criteria that are currently used for evaluating State damage prevention programs.

PHMSA will generally to take actions on more serious cases where state enforcement is lacking.  Hopefully, the federal evaluation will result in increased enforcement by states, including elimination of exemptions to the one-call regulations.

READ MORE of the rulemaking proposal transmitted by PHMSA to the Federal Register is on the agency’s website.


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