Transportation Safety Alert
(by Boyd Stephenson and James Curry)
On October 24, 2019, the Pipeline and Hazardous Materials Safety Administration (PHMSA) published a notice of proposed rulemaking (NPRM) proposing to amend the Hazardous Materials Regulations (HMR) to allow the bulk transport of liquefied natural gas (LNG) in DOT-113C120W (DOT-113) specification railcars. PHMSA issued the NPRM in response to a petition for rulemaking filed by the Association of American Railroads (AAR). Also, an April 10, 2019, Executive Order directed PHMSA to issue a final rule on bulk transportation of LNG by rail by May 2020. Comments on the NPRM are due by December 23, 2019.
Over the last decade, the number of LNG facilities, and total storage and vaporization capacities have drastically increased. And, according to PHMSA, total liquefaction capacity increased by 939% due to new LNG export terminals. With this growth, PMHSA has recognized there may be a need for greater flexibility in the modes of transporting LNG. While LNG is already authorized for transportation by highway and in maritime vessels, LNG may only be transported by railcar with a special permit from PHMSA or in smaller, portable tanks loaded onto a railcar. However, other cryogenic liquids that are chemically similar to LNG are already authorized to be transported by rail under the HMR.
Currently, there is a pending special permit renewal application to transport bulk LNG in DOT-113 specification railcars using requirements identical to those proposed in the NPRM. The comment period ended on August 7, 2019, with PHMSA receiving nearly 3,000 comments. PHMSA has not yet acted on the special permit application.
Proposed Changes
In the NPRM, PHMSA proposes to:
- Amend the LNG entry on the Hazardous Materials Table (UN 1972, Methane, refrigerated liquid (cryogenic liquid), 2.1) to allow transportation of bulk LNG in rail tank cars under the terms of 49 C.F.R. § 173.319
- Amend the railcar provisions in the cryogenic liquid table in 49 C.F.R. § 173.319, to add the following requirements for bulk railcars transporting LNG:
- Using a DOT-113 specification rail tank car
- A start-to-discharge pressure valve setting of 75 psig
- A design service temperature of -260 ˚F
- Maximum pressure when offered for transportation of 15 psig
- A filling density of 32.5 percent by weight
- PHMSA did not propose any changes to the DOT-113 tank car design for transporting bulk LNG, or for handling bulk LNG in transit, but the agency solicits comments about:
- Whether there is a reason to set a maximum length of trains transporting LNG and, if so, what that maximum length should be
- Whether there is a reason to limit the number of LNG railcars that can be in one consist or to limit where LNG tank cars may be placed within the train
- Whether PHMSA should apply its high-hazard flammable train (HHFT) rules to trains transporting bulk LNG, including:
- Speed restrictions and tightened speed restrictions in high-threat urban areas
- Two-way end-of-train devices for faster air brake deployment in emergency situations
- Whether PHMSA should adopt the AAR’s Circular OT-55 “Recommended Railroad Operating Practices for Transportation of Hazardous Materials,” which all Class I and II freight railroads operating in the United States currently observe, into the rules for transporting bulk LNG
- Whether the additional route analysis requirements currently applied to HHFTs and to trains transporting explosives, toxic inhalation hazards, or radioactive cargo should also be applied to trains transporting bulk LNG
Questions and Commentary
- Canada already allows the transport of bulk LNG in DOT-113 railcars, but, according to the NPRM, Mexico “does not provide explicit authorization for bulk transportation of LNG in rail tank cars.” Yet, PHMSA cites increased Mexican demand for LNG as one reason why rail transport demand is rising.
- Ethylene is a cryogenic liquid that is already approved to be transported in the same type of DOT-113 specification railcars proposed for LNG. But, according to AAR data, only 356 ethylene tank car movements originated in 2015. PHMSA notes that “the numbers of DOT-113 tank cars in operation under the proposed regulatory change could increase well beyond the numbers of DOT-113 tank cars currently in operation.”
- In addition to the DOT-113C120W railcar proposed for transporting bulk LNG, AAR’s petition requested PHMSA also authorize the DOT-113C140W (140W) railcar. The 140W is not widely deployed and PHMSA elected not to include it in the NPRM due to a paucity of safety data. Rather, the Agency proposes to further study the 140W tank car’s technical standards and performance. The 140W better insulates the tank car’s inner compartment from thermal creep and is designed to allow the railcar to travel for longer periods before the cryogenic liquid can vaporize into gas. Would also authorizing the 140W expand shippers’ options for exporting LNG directly instead of delivering for transfer to a vessel at a maritime port?
- PHMSA states that the NPRM does not impose costs or provide benefits exceeding $100 million annually, but the Office of Management and Budget chose to designate it a significant rulemaking, subject to additional review, anyway. At the same time, an executive order mandates PHMSA take final action considering allowing bulk LNG by rail by May 2020. With such an accelerated timeline, will PHMSA be able to resolve public comments and conduct the necessary economic analysis?
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Pipeline Safety Alert
(by James Curry, Keith Coyle and Brianne Kurdock)
This is the third alert in a four-part Babst Calland series on the Pipeline and Hazardous Materials Safety Administration’s (PHMSA or the Agency) final rule amending the federal safety standards for gas pipeline facilities (Rule). PHMSA published the Rule in the Federal Register on October 1, 2019. The first alert reviewed new requirements for materials verification and reconfirmation of maximum allowable operating pressure (MAOP). The second alert provided a summary of the integrity assessment requirements for areas outside of high consequence areas. This alert will summarize the new Part 192 recordkeeping requirements. Finally, Babst Calland will survey the remaining Rule topics.
New Part 192 Recordkeeping Requirements – 49 C.F.R. §§ 192.5, 192.67, 192.205, 192.127, 192.227, 192.517, 192.607, 192.619, and 192.624
At an earlier point in the rulemaking process, PHMSA proposed to establish several new retroactive recordkeeping requirements in Part 192. PHMSA also took the position that all records had to satisfy the reliable, traceable, verifiable, and complete (TVC) recordkeeping standard. A version of this standard was used by the National Transportation Safety Board (NTSB) in its recommendations after the 2010 San Bruno pipeline incident. PHMSA did not propose a definition of the TVC recordkeeping standard but instead referred to the agency’s TVC guidance issued in 2012.
In the Rule, PHMSA made significant changes to its proposed recordkeeping requirements including clarifying that the new recordkeeping requirements are prospective only and removing ‘reliable’ from TVC since that term was never used by the NTSB. PHMSA also drew distinctions in several regulations between the obligations that apply to operators of pipelines installed prior to July 1, 2020, which only require retention of existing records, and those installed after this date, further emphasizing the prospective nature of the new obligations.
What is in the Rule?
New Record Requirements for Pipelines Installed on or before July 1, 2020
Class Location Records (§ 192.5(d)). An operator must retain records documenting how it determined the current class location of its pipeline, but does not need to have historical records for prior class locations. Unlike many of the other recordkeeping requirements, PHMSA did not limit this provision to transmission pipelines.
Material Records (§ 192.67). For steel transmission pipelines installed on or before July 1, 2020, an operator must retain records for the life of the pipeline that document tests, inspections, and attributes required by the manufacturing specifications applicable at the time the pipe was manufactured or installed, but only if the operator has such records. PHMSA notes that if the operator does not have these records and needs them to establish MAOP, then the operator could be subject to the new MAOP reconfirmation requirements.
Pipeline Components (§ 192.205(b)). An operator of a steel transmission pipeline installed on or before July 1, 2020, must retain records documenting the manufacturing standard and pressure rating valves, flanges, fittings, branch connections, extruded outlets, anchor forgings, and other components with material yield strength grades of 42,000 psi or greater and with nominal diameters of greater than 2 inches for the life of the pipeline but only if the operator has such records. PHMSA notes that if an operator of an existing pipeline does not have these records and needs them to establish MAOP, then the operator could be subject to the new MAOP reconfirmation requirements.
Design Records (§ 192.127(b)). An operator of a steel transmission pipeline installed on or before July 1, 2020 must retain records documenting pipe design and the determination of design pressure in accordance with §§ 192.103 and 192.105, for the life of the pipeline but only if the operator has such records. PHMSA notes that if an operator of an existing pipeline does not have these records and needs them to establish MAOP, then the operator could be subject to the new MAOP reconfirmation requirements.
Test Records (§ 192.517). An operator must make and retain for the life of the pipeline a record of each test conducted under §§ 192.505, 192.506, and 192.507.
Material Verification Records (§ 192.607). An operator subject to § 192.607 must document the physical pipeline characteristics and attributes, including diameter, wall thickness, seam type, and grade (e.g., yield strength, ultimate tensile strength, or pressure rating for valves and flanges, etc.) and retain these records for the life of the pipeline. These records must meet the TVC standard.
Establishing Maximum Allowable Operating Pressure (§ 192.619). An operator of a pipeline in operation as of July 1, 2020, must retain any existing records establishing the MAOP for the life of the pipeline. If an operator does not have these records and is required to reconfirm MAOP in accordance with § 192.624, the company must retain the reconfirmation records for the life of the pipeline.
Reconfirmation of Maximum Allowable Operating Pressure Records ((§ 192.624). An operator subject to the MAOP reconfirmation requirements must retain records of investigations, tests, analyses, assessments, repairs, replacements, alterations, and other actions taken in accordance with the requirements of § 192.624 for the life of the pipeline.
Recordkeeping Requirements for Pipelines Installed After July 1, 2020.
Material Records (§ 192.67). For steel transmission pipelines installed after July 1, 2020, an operator must make records that document the physical characteristics of the pipeline. The operator must retain these records for the life of the pipeline.
Design Records (§ 192.127). Operators of a steel transmission pipeline installed after July 1, 2020 must make records documenting that the pipe is designed to withstand external pressures and loads in accordance with § 192.103 and made in accordance with § 192.105. The operator must retain these records for the life of the pipeline.
Components ((§ 192.205(a)). Operators of a steel transmission pipeline installed after July 1, 2020, must make records documenting the manufacturing standard and pressure rating to which each valve was manufactured and tested in accordance with Subpart D of Part 192. Flanges, fittings, branch connections, extruded outlets, anchor forgings, and other components with material yield strength grades of 42,000 psi (X42) or greater and with nominal diameters of greater than 2 inches must have records documenting the manufacturing specification in effect at the time of manufacture, including yield strength, ultimate tensile strength, and chemical composition of materials. The operator must retain these records for the life of the pipeline.
Welding Records (§ 192.227(c)). An operator of a steel transmission pipeline installed after July 1, 2021, must have records demonstrating each individual welder qualification at the time of construction. An operator must retain these records for five years following construction. This is a change from the lifetime requirement that PHMSA had initially proposed. PHMSA has also adjusted the effective date of this requirement to apply to pipelines installed one year from the effective date of the Rule.
Plastic Pipe (§ 192.285(e)). An operator of a plastic transmission pipelines installed after July 1, 2021, must have records demonstrating each individual’s plastic pipe joining qualifications at the time of construction. An operator must retain those records for a minimum of five years following construction. This is a change from the lifetime requirement that PHMSA had initially proposed. PHMSA has also adjusted the effective date of this requirement to apply to pipelines installed one year from the effective date of the Rule.
Establishing Maximum Allowable Operating Pressure (§ 192.619). An operator of a pipeline placed in operation after July 1, 2020, must make and retain records establishing the MAOP for the life of the pipeline.
What is not in the Rule?
Definition of traceable, verifiable, and complete. PHMSA declined to define TVC stating that “changing that standard could potentially derail work being done by operators to meet that traceable, verifiable, and complete record standard.” Instead, the Agency referenced its definitions of the TVC standard published in guidance from 2011 and 2012. In comparing the language in the preamble of the Rule with the previous Advisory Bulletins, the Firm notes several changes to the description of TVC. PHMSA has added that the individual who observed the test and thereafter signed an affidavit as to the test conducted would have to be ‘qualified’. In the preamble, the Agency did not recognize prior interpretations which allowed for a single record, rather than complementary records to meet the TVC standard. Finally, PHMSA added mechanical and chemical properties to its description of pipe mill records.
General Duty Clause of § 192.13(e). The Agency eliminated the proposed general duty clause of § 192.13(e) which would have required that all records meet the TVC standard.
Table of Record Retention Requirements. PHMSA removed its proposed table (Appendix A) that summarized current and new recordkeeping retention requirements. Although PHMSA maintained that this table memorialized current recordkeeping requirements, it arguably had created new retention requirements that were not supported by the text or history of the regulations.
For a more detailed assessment and redline of the Rule, please contact a member of the Pipeline and HazMat Safety practice group.
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Environmental Alert
(by Lisa Bruderly and Gary Steinbauer)
On October 22, 2019, the U.S. Environmental Protection Agency (USEPA) and U.S. Army Corps of Engineers (Corps) published a final rule in the Federal Register repealing the Obama administration’s 2015 rule redefining “waters of the United States” (WOTUS) under the Clean Water Act, typically referred to as the “Clean Water Rule” (CWR). In addition to repealing the CWR, the final rule will restore the regulatory definition of WOTUS that existed prior to the CWR for the 22 states (including Pennsylvania) where the CWR’s WOTUS definition is currently in effect. The pre-CWR definition of WOTUS, along with agency guidance, are themselves controversial. The final repeal rule becomes effective on December 23, 2019.
USEPA and the Corps released a pre-publication version of the final repeal rule on September 12, 2019. Almost immediately, environmental groups and several states vowed to file lawsuits challenging the final repeal rule. These lawsuits likely will be heard by multiple federal district courts throughout the country and could seek injunctions preventing the final repeal rule from taking effect. While the intent of the final repeal rule is to end the existing regulatory patchwork where the CWR’s WOTUS definition currently is in effect in 22 states, the lawsuits challenging the final repeal rule could result in a different regulatory patchwork, further exacerbating the regulatory uncertainty surrounding the application definition of WOTUS. In an interesting twist, the New Mexico Cattle Growers’ Association filed a lawsuit on October 22, 2019 in a federal district court in New Mexico, challenging the final repeal rule because the pre-CWR WOTUS definition and related agency guidance that it readopts are allegedly unlawful.
Babst Calland discussed the final repeal rule in detail in a previous Environmental Alert and will continue to actively monitor the shifting regulatory landscape involving the definition of WOTUS. If you have questions about the final repeal rule, please contact Lisa M. Bruderly at (412) 394-6495 or lbruderly@babstcalland.com or Gary E. Steinbauer at (412) 394-6590 or gsteinbauer@babstcalland.com.
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Smart Business
(by Jayne Gest with Sara Antol and Chris Farmakis)
When companies start running out of capital and executives are pulled in a million different directions, they often look to an outside party — a person who is well-connected but is not a licensed broker/dealer — to support the fundraising. The two parties may come to an arrangement where he or she will make introductions, help secure additional investment and only be paid a commission if the financing round successfully closes.
The problem is, this scenario is illegal under the rules of Securities and Exchange Commission (SEC). And the excuse — everyone else is doing it — will not work if you are caught, says Sara M. Antol, shareholder at Babst Calland.
“When it comes to broker-dealer territory, many times businesses do not realize how strict the current regulatory environment is, or how extreme the consequences can be when you violate the law,” she says.
Smart Business spoke with Antol and Christian A. Farmakis, shareholder and chairman of the board at Babst Calland, about fundraising compensation.
How common are these arrangements?
Raising money is difficult — it takes time and can be frustrating. Because fundraising is relationship-driven, it is easy to want to bring in a well-connected person in some capacity. And if a company is on a tight budget, it may seem logical to just pay someone if they have success. However, only registered broker-dealers are allowed to engage in this type of activity. And, it is illegal for persons who have not undergone the steps to be registered to act as brokers.
What is permissible?
A company can work with a finder as a consultant, hired under certain narrowly defined conditions. The company must pay a flat or monthly fee that might include helping the organization develop investment materials and making introductions, without negotiating or aiding in the investment’s completion. The compensation cannot be tied to fundraising success.
The other option is to work with a registered broker-dealer. Plenty of firms do this, but it will come at a cost.
How should companies handle these situations with their own employees?
Businesses cannot make someone’s employment or compensation contingent upon raising capital. For example, a CFO who gets equity or a bonus if he or she is successful at fundraising is not allowed. A salesperson paid on commission for finding investors is also not permitted.
Raising capital can be part of an employee’s duties, but it cannot be their sole job function, and they cannot get compensated directly for bringing in investors.
What can be the consequences of incorrectly using a finder or employee to raise capital?
Any companies — whether private or public — that improperly use a nonregistered finder or employee may have to rescind their offer to investors and refund the entire investment monies paid, even when those funds have already been spent.
If the company and its executives are sanctioned, they may not be allowed to do a private placement in the future, such as a Regulation D offering. The individuals named in a sanction may be labeled as “bad actors.” These bad boys, as they are often called, come under regulatory scrutiny for a number of years. There is also the potential of criminal penalties against the individual and the company. The reputational damage to a startup and founder can be severe, even if the violation was unintentional.
When fundraising, what else is important?
Many startups do not put together adequate disclosure documents that lay out all of the upside and downside of an investment. That is why, at least under the current regulatory landscape, it can be a good idea to only raise money from accredited investors. These investors have earned income exceeding $200,000 ($300,000 with a spouse), or a net worth of $1 million, excluding the value of the primary residence. The requirements must be met for the prior two years, with an expectation of the same for the current year.
Remember, fundraising rules are not black and white. The regulations and rules of the road have developed through court cases and on a case-by-case basis with the SEC, so check with your attorney before putting an intermediary between you and potential investors.
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The Legal Intelligencer
(by Krista-Ann Staley and Jenn Malik)
On Aug. 20, the Pennsylvania Supreme Court invalidated a municipal ordinance that imposed additional controls on state-regulated public utilities for use of the municipality’s rights-of-way, in PPL Electric Utilities v. City of Lancaster, No. 55 MAP 2017 (Pa. 2019). By way of background, the city of Lancaster enacted a local ordinance in 2013 implementing a comprehensive right-of-way management program, including granting the city certain powers to regulate public utilities and charge an annual occupancy fee. The city relied upon its authority under the Home Rule Charter and Optional Plans Law, 53 Pa.C.S. Sections 2901-3717, and the Third Class City Code, 53 P.S. Sections 35101-39701 (TCCC), for its authority to adopt the ordinance.
PPL Electric Utilities Corp. challenged the ordinance, arguing that the Public Utility Code and the regulations promulgated by the Public Utility Commission (PUC) preempted local authority. The ordinance provisions at issue were as follows:
• Section 263B-3 of the ordinance permitted the city to inspect public utilities and confirm their compliance with the code and the PUC regulations (inspection provision).
• Section 263-B4(6) of the ordinance permitted the city to remove, relocate or reposition utilities in the right-of-way (relocation provision).
• Section 263D-1 of the ordinance authorized the city to impose fees for violations not in the PUC’s exclusive jurisdiction (penalties provision).
• Section 263B-5 of the ordinance permitted the city to impose a maintenance fee on public utilities for use of the city’s rights-of-way (maintenance fee provision).
In February 2014, PPL filed a petition for review in the Commonwealth Court’s original jurisdiction seeking declaratory and injunctive relief against the city. The PPL argued that: the regulatory authority of the PUC and the code preempted the city’s ordinance, that the PUC was the only authority empowered to oversee the location, construction and maintenance of public utilities, and that the city had exceeded its authority under the Municipalities Planning Code, 53 P.S. Sections 10101-11202 (MPC) and the Business Corporation Law of 1988, 15 Pa.C.S. Sections 1101-4146 (BCL).
The Commonwealth Court entered summary judgment in PPL’s favor with respect to all challenges, except that concerning the maintenance fee provision, on the basis that same were preempted by the code and the PUC regulations. Analyzing preemption principles, the Commonwealth Court recognized that “the courts of this commonwealth have long recognized the intent of our General Assembly that public utilities be regulated on a uniform basis by a statewide regulator and not be subject to the varied regulation of the many cities, townships and boroughs throughout the commonwealth.” The Commonwealth Court held that the code and PUC regulation preempted the ordinance, with the exception of the maintenance fee provision. Regarding that provision, the court held that “imposing fees to offset locally incurred maintenance expenses does not constitute impermissible regulation of public utilities.” Both parties appealed the commonwealth’s holding to the Pennsylvania Supreme Court.
The Pennsylvania Supreme Court began by giving an overview of preemption principles: “contemporary expressions of the three varieties of preemption are legion, and they distill reams of case law to the proposition that preemption may occur when the legislature has expressly stated its intention to displace local regulation (express preemption), or has occupied the regulatory field in question (field preemption), or, finally, where the local regulation would conflict with or confound rather than advance the operation of the state law in question (conflict preemption).” Next, the court addressed its prior decision concerning utilities regulation and preemption in Borough of Lansdale v. Philadelphia Electric, wherein the court, on the basis of preemption, struck down a county ordinance that prohibited the construction of a pipeline without submitting plans to the county. The court also discussed its decision in Duquesne Light v. Upper St. Clair Township, wherein it held that a township could not by ordinance prevent a public utility from exercising its eminent domain powers on the basis that such an action is preempted by the code.
Turning to the city’s appeal of the Commonwealth Court’s grant of summary judgment for PPL’s challenge to the inspection, relocation, and penalties provisions of the ordinance, the Pennsylvania Supreme Court invalidated the city’s ordinance on the basis of field preemption. The city argued that the court was obliged to apply a conflict preemption analysis, and that the ordinance should survive such analysis because its terms do not directly conflict with the code. The court was unconvinced by the city’s conflict preemption argument, noting that “a winning conflict preemption argument cannot restore what field preemption already precludes. Upon finding that the legislature intended to occupy the regulatory field, we must reject all local regulation fairly encompassed by that field. Consequently, the city’s arguments not withstanding, we need only determine whether ordinance Sections 263B-3, 263B-4(6), and 263D-1 intrude upon the field that the General Assembly has entrusted to state law and PUC oversight and enforcement. We find that they do.” This underlying concern with uniformity of application of laws governing public utilities, specifically the effect of mass local regulation of public utilities and the “patchwork of ‘supplementary’ regulatory enforcement at whim,” is present throughout the opinion.
Next addressing PPL’s appeal that the Commonwealth Court erred by upholding the maintenance fee provision of the ordinance, the Pennsylvania Supreme Court held that “like the state-level tariff imposed by the PUC, the city proposes to impose a fee that, at least in part, reflects the regulatory expense of overseeing utilities’ conduct … consequently, the maintenance fee, too, is preempted by the code in favor of the PUC’s authority to regulate
public utilities.”
Local Regulation of Public Utilities
After the court’s holding in City of Lancaster, the question remains: can local municipalities regulate any public utilities? The answer is yes, but to a very limited degree. For example, Section 619 of the MPC provides that “Article VI of the MPC governing zoning shall not apply to any existing or proposed building, or extension thereof, used or to be used by a public utility corporation, if, upon petition of the corporation, the Pennsylvania Public Utility Commission shall, after a public hearing, decide that the present or proposed situation of the building in question is reasonably necessary for the convenience or welfare of the public,” 53 P.S. Section 10619. Consequently, it would appear that Section 619 authorizes municipalities to regulate public utility buildings via zoning under the limited circumstance where the PUC finds that the building is not reasonably necessary for the convenience or welfare of the public.
Additionally, Section 1511(e) of the BCL addresses a public utility’s rights with respect to streets and other places, providing that “before entering upon any street, highway or other public way, the public utility corporation shall obtain such permits as may be required by law and shall comply with the lawful and reasonable regulations of the governmental authority having responsibility for the maintenance thereof.” Local governments have attempted to use Section 1511(e) as authority to regulate public utilities. However, in PECO Energy v. Township of Upper Dublin, the Commonwealth Court concluded that 1511(e) does not constitute an exception to the PUC’s jurisdiction, nor does it grant municipalities additional regulatory powers. Additionally, in the City of Lancaster, the Pennsylvania Supreme Court eludes to the application of Section 1511(e) of the BCL to address permitting and related matter associated with entry into rights-of-way, i.e., grading permits and the like.
Section 1991 of the General Municipal Law, 53 P.S. Section 1991, titled, “Use of Streets by Public Utilities,” as indicated in its name, governs the use of streets by public utilities. Section 1991 specifically provides: “The proper corporate authorities of such municipality shall have the right to issue permits determining the manner in which public service corporations or individuals shall place, on or under or over such municipal streets or alleys, railway tracks, pipes, conduits, telegraph lines, or other devices used in the furtherance of business; and nothing herein contained should be construed to in any way affect or impair the rights, powers, and privileges of the municipality in, on, under, over, or through the public streets or alleys of such municipalities, except as herein provided.”
Pennsylvania courts have clarified that Section 1991 only permits regulation of the manner of the initial placement of utility facilities requiring excavation and restoration of public streets. See Pennsylvania Power v. Township of Pine, 926 A.2d 1241 (Pa. Commw. Ct. 2007)
Finally, as the Commonwealth Court recently explained in Township of Pine, the scope and berth of the permitting authority set forth in Section 1911 of the law has been limited by Section 1511 of the BCL to “matters of local concern,” such as, without limitation, “the manner in which a street or highway is opened, back-filled, repaved, etc., the length of time that the excavation is open, the length of trench open at one time, and the hours of excavation,” 926 A.2d 1241, 1251 (Pa. Commw. Ct. 2007) (concluding that the installation of distribution lines above ground versus underground within a township’s right-of-way was not, by statutory definition, a matter of local concern, and accordingly the township had no authority to require the public utility to proceed in one fashion or the other).
Thus, Pennsylvania municipalities have limited rights to regulate public utilities’ use of their rights-of-way in the context of limited zoning regulation of public utility buildings where the PUC has found that the building is not necessary for the public safety or welfare and pursuant to Section 1991 of the law, 53 P.S. Section 1991, to require that a public utility obtain a permit determining the manner in which it may place on, under, or over municipal streets or alleys, railway tracks, pipes, conduits, telegraph lines or other devices used in the furtherance of business.
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Reprinted with permission from the October 17, 2019 edition of The Legal Intelligencer © 2019 ALM Media Properties, LLC. All rights reserved.
Pipeline Safety Alert
(by James Curry, Keith Coyle and Brianne Kurdock)
This is the second alert in a four-part Babst Calland series on the Pipeline and Hazardous Materials Safety Administration (PHMSA or the Agency) final rule amending the federal safety standards for gas pipeline facilities at 49 C.F.R. Part 192 (Rule) published in the Federal Register on October 1, 2019. The first alert reviewed new requirements for materials verification and reconfirmation of maximum allowable operating pressure (MAOP).
This alert discusses PHMSA’s extension of integrity assessment requirements to areas outside high consequence areas (HCAs). The third alert will review the new recordkeeping requirements. Finally, Babst Calland will survey the remaining Rule topics.
Assessing Areas Outside of High Consequence Areas – 49 C.F.R. §§ 192.3 and 192.710
PHMSA has introduced new regulations requiring an operator to conduct integrity assessments outside of HCAs. The Agency has categorized these areas as Moderate Consequence Areas (MCAs).
What is in the Rule?
- Moderate Consequence Area Definition. A “moderate consequence area” is an onshore area that is within a potential impact circle containing either five or more buildings intended for human occupancy or any portion of the paved surface, including shoulders, of a designated interstate, freeway, or expressway, or principal arterial roadway with four or more lanes, as defined by the Federal Highway Administration.
- Initial Assessment and Reassessment Interval. Operators with an onshore, steel, transmission pipeline segment with a MAOP greater than or equal to 30% SMYS located in a Class 3 or Class 4 location or a piggable MCA segment must assess these segments by July 3, 2034 and every ten years thereafter at intervals of 126 months. Although PHMSA has allowed a ten-year schedule for reassessments, the Agency has cautioned that an operator must assess its segments earlier depending on the type of anomaly, operational, material, or environmental conditions, or as necessary to ensure public safety.
For those segments that become a MCA in subsequent years, the operator must conduct the initial assessment as soon as practicable but prior to ten years from when the pipeline first meets the applicability conditions in § 192.710(a).
An operator may use a prior assessment to comply with the initial assessment requirement as long as the prior assessment was conducted before July 1, 2020. An operator may also use an assessment conducted in response to § 192.624(c) as the initial or reassessment.
- Assessment Methods. Pursuant to § 192.710(c), acceptable assessment methods include in-line inspection (ILI) tools, pressure tests (including spike tests), direct examination, guided wave ultrasonic testing, direct assessment, and alternative technologies.
- Review of Assessment Data. Within 180 days, qualified personnel must examine the assessment data and determine if there are any conditions that present a potential threat to pipeline integrity, unless the operator can demonstrate that meeting that deadline is impracticable. An operator must then remediate any conditions that could adversely affect the safe operation of the pipeline in accordance with 49 C.F.R. §§ 192.485, 192.711, and 192.713.
- Direct Assessment. PHMSA confirmed that direct assessment may be used only if appropriate for the threat being assessed.
What is not in the Rule?
- Occupied Sites. In response to numerous comments from stakeholders, PHMSA removed ‘occupied sites’ from the definition of MCAs. The inclusion of ‘occupied sites’ would have required operators to evaluate where there are outside areas or open structures within the potential impact radius that are occupied by five or more persons for at least 50 days in a twelve-month period or buildings that are occupied by five or more persons on at least five days a week for ten weeks in any twelve-month period. The Agency agreed that including these areas would be unnecessarily burdensome without a comparable decrease in risk.
- Rights-of-Way. The Agency also modified its approach to highways limiting the definition of a MCA to include the pavement of the road and shoulders but not the more expansive right-of-way.
- Definition of Piggable. PHMSA declined to define “piggable segment.” PHMSA explained that this term is widely understood and means segments that can accommodate ILI tools “without the need for major physical or operation modification, other than the normal operational work required by the process of performing an ILI.”
For a more detailed assessment and redline of the Rule, please contact a member of the Pipeline and HazMat Safety practice group.
Click here for PDF.
Transportation Safety Alert
(by Boyd Stephenson and James Curry)
On August 22, 2019, the Federal Motor Carrier Safety Administration (FMCSA) published a notice of proposed rulemaking (NPRM) containing potential changes to the hours of service (HOS) regulations for all drivers operating in interstate commerce and for drivers transporting hazardous materials in intrastate commerce. FMCSA initiated the rulemaking to update the HOS in light of compliance challenges revealed by the Agency’s 2017 electronic logging device mandate. In the NPRM, FMCSA proposes to:
- Expand the current “short-haul” exception to the HOS rules;
- Expand the adverse driving exception to the HOS rules;
- Allow any 30-minute period of non-driving time to count towards the30-minute rest break;
- Expand access to the sleeper berth exception; and
- Allow a single off-duty break to extend the driver’s on-duty window by the length of the break.
The proposed changes will likely provide operational flexibility to every sector of the trucking industry. Local drivers’ on-duty windows will expand to equal the time currently allotted for long-haul drivers. At the same time, the rules would provide more options to long-haul operators, who will be able to use on-duty time for their required break and to expand their driving window by strategically taking optional breaks at times that allow them to avoid driving in heavy traffic. Comments are due by October 21, 2019.
Current Daily Maximum Driving Times
While FMCSA proposes several exceptions to the basic daily rules, the Agency has not proposed changes to the daily base HOS requirement for property-carrying or passenger-carrying commercial motor vehicles (CMVs).
- A property-carrying CMV driver may drive up to 11 hours during a14-hour window beginning when the driver begins on-duty status. The driver is then prohibited from driving until a 10 consecutive hour period of off-duty time elapses.
- A passenger-carrying CMV driver may drive up to 10 hours in a 15-hour window. The driver isthen prohibited from driving until an eightconsecutive hour period of off-duty time elapses.
Proposed Changes
Short–Haul Exception – The existing short-haul exception exempts property-carrying drivers from the requirement to maintain records of duty status (RODS or logs) and supporting documents for their logs if:
- They report to and depart from the same location for a shift;
- They are on duty for 12 hours or less;
- They drive 11 hours or less;
- They remain within a 100 air-mile (115 mile) radius of their reporting location for their entire shift;
- They receive at least 10 consecutive hours off duty at the end of their shift; and
- Their employers maintain records going back six months demonstrating reporting time, departuretime, reporting/departure location, and the number of hours worked are consistent with the requirements above.
Passenger-carrying drivers operate under the same requirements except they may only drive 10 hours in the 12-hour workday. Passenger-carrying and property-carrying short-haul drivers are not exempt from the maximum driving time restrictions, they are merely exempt from logging compliance with them.
FMCSA proposes to extend the qualification period from shifts up to 12 hours to shifts up to 14 hours and the qualification radius from 100 air-miles to 150 air-miles (172.5 miles). Maximum driving times would remain unchanged. FMCSA adds that it is considering further altering the exception to allow CMV drivers to utilize the short-haul exception even if they do not report to and depart from same location, so long as all of the other existing requirements are followed. The NPRM does not provide proposed regulatory language implementing this possible change.
Adverse Driving Conditions Exception – The current adverse weather HOS exception allows a driver experiencing unexpected dangerous driving conditions to extend their driving time by up to two hours or until they reach a location safe for the vehicle occupants and secure for its cargo, whichever occurs first. Presently, the exception extends the amount of time the driver can drive, but it does not extend the 14-hour on-duty window. FMCSA proposes to extend the exception to cover both driving time and the driving window. This expansion applies to both cargo-transporting and passenger-carrying CMVs, allowing up to 13 hours of driving in a 15-hour window for cargo-transporting CMVs and 12 hours of driving in a 17-hour period for passenger-carrying CMVs.
30-Minute Rest Break – Presently, all property-carrying CMV drivers are required to take a 30-minute off-duty period after eight hours of driving before they can drive again. FMCSA proposes to expand access to the rest break by allowing any 30-minute period of off-duty, sleeper berth, or on-duty not driving time to qualify for the rest break. Passenger-carrying CMV drivers are not required to take the 30-minute rest break, so FMCSA has not proposed any changes to their operations.
FMCSA is also considering eliminating the 30-minute rest break entirely. However, the NPRM does not include proposed regulatory language.
Sleeper Berth – Today, HOS rules allow a property-carrying CMV driver to divide the 10 hours off-duty required to reset the daily driving limits between two separate, but consecutive, periods. Drivers must take at least eight hours in the sleeper berth and a second period, of at least two hours, of off-duty time which can be in the sleeper berth or riding in the passenger seat. It does not matter which of these two periods occurs first. Driving time in the periods immediately before and after each rest period must not exceed 11 hours, nor may the total driving window, minus the time spent in the sleeper berth and in sleeper berth/optional passenger seat time, exceed 14 hours. The sleeper berth exception applies only to drivers of property-carrying.
FMCSA proposes to add flexibility to this time by lowering the minimum sleeper berth time from eight to seven hours consecutive hours while retaining the requirement that 10 total hours of sleeper berth plus sleeper berth/optional passenger seat time elapses. FMCSA notes that it is also considering adjusting this split to six hours in the sleeper berth and four hours that could be taken in the sleeper berth or in the passenger seat. However, the NPRM does not provide proposed regulatory text for this option.
Drivers could not utilize the sleeper berth exception, in its present form or with FMCSA’s proposed changes, and the proposed break to extend the driving window (below) during the same driving period.
Break to Extend Driving Window – FMCSA proposes a new provision that would allow a driver to take a single break of between 30 minutes and three hours and to extend the 14-hour driving window by the length of the break. Drivers could not utilize the break to extend the driving window and the sleeper berth exception during the same driving period.
FMCSA asks for input about the possibility of dividing the break to extend the driving window into multiple breaks of at least 30 minutes that could total up to three hours, but the Agency does not propose regulatory text.
Compliance Dates – Because drivers are now required to demonstrate compliance with the HOS via electronic logs, FMCSA has requested electronic logging device manufacturers to weigh in and explain how much time would be necessary to reprogram their devices to conform to a new set of rules. FMCSA has requested comment on six-month and one-year implementation periods.
Rulemaking Petitions – FMCSA also responded to four rulemaking petitions in the NPRM, from the Owner-Operator Independent Driver Association (OOIDA), TruckerNation, the United Drivers Association (UDA), and the U.S. Transportation Alliance (USTA). OOIDA’s petition requested that breaks could be used to extend the driving window, and FMCSA included that concept in the NPRM. TruckerNation requested that FMCSA alter the 14-hour driving window to begin after the driver begins driving, rather than coming on duty, and to pool off-duty periods of three hours or longer to meet the 10 hour off-duty requirement to open a new 14-hour driving window. FMCSA denied TruckerNation’s petition. The USTA petition proposed allowing pooling of more than two off-duty sleeper berth periods, which could be as short as two hours, while the UDA proposed splitting the sleeper berth required periods into five sleeper berth hours and five optional hours. Both the USTA and the UDA also proposed reducing the minimum off-duty time to restart a driver’s weekly maximum on-duty time from 34 hours to 24 hours. FMCSA rejected both petitions, but noted that it would consider them as comments on relevant parts of the NPRM.
Observations & Questions
- The NPRM would forbid drivers from using a split-sleeper berth period and a break extending the14-hour driving window in the same driving period. But, FMCSA also explicitly states a driver need not declare whether they are taking the first half of a sleeper berth break or one extending the 14-hour window until choosing to take the second half of the sleeper break. While this language is consistent with the NPRM’s proposed language, FMCSA is also considering allowing multiple breaks to extend the 14-hour window. If FMCSA allows multiple breaks to extend the 14-hour window
and doesn’t force drivers to choose whether they are extending their driving window or using sleeper berth break, how can enforcement agencies differentiate between the two until the driver begins the second period of the sleeper berth exception? If FMCSA allows for shorter breaks to extend the driving window, could FMCSA allow drivers to combine them with split-sleeper time and still ensure a safety level at least equivalent to that under current regulations?
- FMCSA asks 39 specific questions in the NPRM. Combined with the Agency’s multiple proposals in areas like altering or eliminating the 30-minute rest break and minimum sleeper berth time, it is possible that FMCSA may need to issue a supplemental NPRM in the future to clarify itsproposal before promulgating a final rule.
- Several commenters submitted sleep science studies that they assert are contrary to FMCSA’s position that its proposed HOS changes will not increase driver fatigue. Similarly, the Insurance Institute for Highway Safety submitted data it claims demonstrates the safety risks of continuing a short-haul exception to the HOS at all are greater than previously understood. FMCSA will need to grapple with these comments as it moves toward a final
- Carriers that transport hazardous materials that require a Pipeline and Hazardous Materials Safety Administration security plan most often satisfy their en route security requirement by directing their drivers to exercise constant attendance over their cargo. Drivers exercising constant attendance cannot log off-duty status, though FMCSA has granted an exemption from the 30-minute rest break requirement for these drivers. Under the exemption, drivers exercising constant attendance over their cargo during their mandatory 30-minute break may log the time as on-duty not driving, but mayperform no other work and must keep a written copy of the exemption in the vehicle. FMCSA’s,proposed changes to the 30-minute rest break mean that drivers exercising constant attendanceduring their rest break will now be compliant, even without the exemption.
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Pipeline Safety Alert
(by James Curry, Keith Coyle and Brianne Kurdock)
On October 1, 2019, the Pipeline and Hazardous Materials Safety Administration (PHMSA or the Agency) published a final rule in the Federal Register amending the federal safety standards for gas pipeline facilities at 49 C.F.R. Part 192 (Rule). The Rule primarily addresses concerns identified in congressional mandates and National Transportation Safety Board (NTSB) recommendations for gas transmission lines. The most significant provisions include new requirements for verifying pipeline materials, reconfirming maximum allowable operating pressure (MAOP), and performing periodic assessments of pipeline segments located outside of high consequence areas (HCAs), including in newly-defined moderate consequence areas (MCAs). Other changes include amendments to the integrity management (IM) requirements, new requirements for reporting MAOP exceedances and the safety of inline inspection launcher and receivers, as well as related recordkeeping requirements.
This alert is the first in a four-part Babst Calland series on the Rule. This first alert discusses the new MAOP reconfirmation and material verification requirements. The next alert will cover MCAs and new assessment requirements for pipelines located outside of HCAs. The third client alert will review the new recordkeeping requirements. Finally, Babst Calland will survey the remaining Rule topics.
Materials Verification – 49 C.F.R. § 192.607
PHMSA established new materials verification requirements for certain kinds of gas transmission pipelines in response to a mandate in the Pipeline Safety, Regulatory Certainty, and Job Creation Act of 2011 (2011 Act). Operators must create procedures for conducting destructive and nondestructive tests if they do not have traceable, verifiable, and complete (TVC) records for pipeline attributes required by other regulations. Specifically, materials verification may be triggered by MAOP reconfirmation, integrity management, or repair regulations applicable to onshore gas transmission pipelines in Class 3 or 4 locations or HCAs.
The Rule provides operators with flexibility and allows for collection of missing pipe attributes over time, whenever a pipeline segment is exposed for maintenance or repairs, until a minimum number of excavations are performed. Gathering and distribution lines are not subject to the materials verification rules.
What is in the Rule?
- Procedure. Operators that are missing adequate records for these pipeline attributes must develop and implement procedures for conducting nondestructive or destructive tests, examinations, and assessments to verify material properties of aboveground line pipe, buried line pipe, and components. These tests, examinations, and assessments must be conducted whenever the pipe is exposed for anomaly direct examinations, in situ evaluations, repairs, remediations, maintenance, and excavations that are associated with replacements or relocations of pipeline segments that are removed from service. An operator’s procedure must address (1) the tests, examinations, and assessments that are appropriate for verifying the necessary material properties and attributes; (2) accepted industry methods for verifying toughness; (3) materials verification of components; and (4) minimum requirements for test locations. Additional requirements apply to the use of nondestructive methods.
- Sampling Program. An operator can also verify material properties and attributes by sampling similar locations and applying those results to comparable segments of pipe. An operator may develop a sampling program in accordance with the requirements established by PHMSA, or may use an alternative approach after seeking a “no objection letter” from PHMSA. Operators must develop an extended sampling program if test results are not consistent with available information, existing expectations, or assumed properties previously used.
- Components. Operators must develop and implement procedures for establishing and documenting the ANSI rating or pressure rating of certain non-line pipe components greater than two inches that are based on the manufacturing specifications of the components, or material pressure ratings and type if specifications are unknown.
- Recordkeeping. Operators must maintain TVC records from the materials verification process for the life of the pipeline.
- Compliance Deadlines. PHMSA did not set a deadline for completion of materials verification. The agency acknowledged that a deadline is not practical since it would be difficult to predict when the pipeline would be exposed. However, operators may need material properties information to comply with other sections of the code which do impose compliance deadlines. For instance, it is unclear whether all affected operators would be able to complete materials verification under the opportunistic approach by the MAOP reconfirmation deadline of July 3, 2028.
What is not in the Rule?
The text of the Rule has changed in important ways as a result of public comment, input from the Gas Pipeline Advisory Committee (GPAC) and input from the Office of Management and Budget (OMB).
- Applicability. PHMSA removed the proposed applicability section and instead made material properties verification a process that operators must follow to obtain missing or inadequate information when required by another Part 192 regulation. PHMSA also removed the list of specific pipe attributes to be obtained. Operators need only obtain the attributes required for the triggering activity, e.g. MAOP reconfirmation. PHMSA rejected industry arguments that material properties verification should not be required for pipeline segments tested to 1.25 times MAOP and should only apply to pipeline segments operating above 30 percent SMYS.
- Materials Verification Plan. PHMSA removed the proposed obligation that all operators create a materials verification plan.
- Alternative and Extended Sampling Programs. PHMSA changed the sampling program by allowing operators to propose an alternative sampling program and develop an extended sampling program to address inconsistencies between the gathered data and records. PHMSA declined to remove the excavation standard of one excavation per mile or 150 if the population is greater than 150 miles, whichever is less. PHMSA reduced the number of required test points for non-destructive tests from four to two quadrants.
MAOP Reconfirmation – 49 C.F.R. § 192.624
Since 1970 operators have established the MAOP of gas transmission lines using either of two methods. The first method requires MAOP to be based on the lowest of the following four pressures: (1) the design pressure of the pipeline, (2) a percentage of the test pressure the pipeline experienced after construction, (3) the highest actual operating pressure that certain pipelines experienced during a five-year historical window, or (4) the maximum safe operating pressure given the pipeline’s history. The second method, which is commonly referred to as the grandfather clause, allows MAOP to be based solely on the highest actual operating pressure that pipelines installed before the original effective date of PHMSA’s regulations experienced during a five-year historical window.
In the 2011 Act, Congress directed PHMSA to establish regulations for reconfirming the MAOP of certain higher-risk gas transmission lines. That mandate was primarily based on NTSB safety recommendations issued in response to the 2010 San Bruno incident. The Rule prescribes the applicability, methods, compliance deadlines, and recordkeeping requirements for MAOP reconfirmation.
What’s in the Rule?
- Applicability. The Rule requires operators to reconfirm the MAOP of onshore gas transmission pipelines that meet either of two criteria. First, MAOP reconfirmation is required if a segment is located in an HCA or Class 3 or 4 location, and the operator does not have TVC records to substantiate the current MAOP. PHMSA declined to define TVC in the Rule, and referenced the guidance that the Agency provided in advisory bulletins issued in 2011 and 2012. Second, MAOP reconfirmation is required if a segment is located in an HCA, a Class 3 or 4 location, or an MCA (only if the segment is piggable); the current MAOP exceeds 30 percent of specified minimum yield strength (SMYS); and the operator established that MAOP using the grandfather clause.
- Methods. The Rule provides gas transmission line operators with six methods for reconfirming the MAOP of covered segments. First, the operator can perform a pressure test in accordance with subpart J. The reconfirmed MAOP is established based on the test pressure, divided by 1.25 or the applicable class location factor, whichever is greater. If the operator lacks TVC records for diameter, wall thickness, of grade the pipe, the operator must obtain the missing information by complying with the new materials verification requirements. Second, the operator can implement a pressure reduction and base the reconfirmed MAOP on the highest actual operating pressure experienced during the five years preceding October 1, 2019, divided by 1.25 or the applicable class location factor, whichever is greater. The five-year historical operating pressure must have been sustained for “a cumulative minimum duration of eight hours during a continuous 30-day period” Additional requirements apply to reconfirming MAOP through a pressure reduction in response to a class location change. Third, the operator can conduct an engineering critical assessment in accordance with the new requirements in 49 C.F.R. § 192.632. Fourth, the operator can replace the pipe. Fifth, the operator can implement a pressure reduction for small potential impact radius (PIR) (150 feet or less) pipelines based on the highest actual operating pressure experienced during the five years preceding October 1, 2019, divided by 1.1. The operator must perform increased patrols and conduct instrumented leakage surveys to reconfirm MAOP under the small PIR method. Finally, the operator can use an alternative technical evaluation process, provided the operator notifies and receives a no objection letter from PHMSA.
- Compliance Deadlines. The Rule provides several compliance deadlines for reconfirming the MAOP of covered segments. Operators must develop MAOP reconfirmation procedures by July 1, 2021, and perform MAOP reconfirmation for at least 50 percent of covered pipeline mileage by July 3, 2028. Operators must complete MAOP reconfirmation for all pipeline mileage by July 2, 2035, or four years from the date that a segment becomes subject to the regulation, whichever is later.
- Recordkeeping. The Rule establishes a lifetime recordkeeping requirement for MAOP reconfirmation records, including records of investigations, test, analyses, assessments, repairs, replacements, alterations, and other actions.
What’s Not in the Rule?
As with materials verification, PHMSA made several important changes to the rule based on public comments and input from the GPAC and OMB.
- Grandfather Clause Repeal. PHMSA chose not repeal the grandfather clause in its entirety. While requested by certain commenters, the Agency concluded that a complete repeal of the grandfather clause would be impractical due to its applicability to other pipelines, including gathering lines, and significant cost-benefit concerns.
- In-Service Incidents. PHMSA originally proposed to apply MAOP reconfirmation to pipeline segments that had experienced reportable, in-service incidents. PHMSA did not include that provision in the Rule, concluding that the casual factors leading to such incidents are already addressed by the integrity management provisions of Part 192.
- Reliable. The Agency decided to remove the word “reliable” from the proposed TVC standard to maintain consistency with the 2011 and 2012 PHMSA advisory bulletins.
- Low-Stress Lines. PHMSA decided against applying the reconfirmation requirement to grandfathered pipelines operating below 30 percent SMYS, finding that extending the requirement to such pipelines would not be cost-effective and that such lines present lesser risk to public safety.
For a more detailed assessment and a redline of the Rule, please contact a member of the Pipeline and HazMat Safety practice group.
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The PIOGA Press
(by Lisa Bruderly and Gary Steinbauer)
Despite a recent federal rulemaking on the definition of “waters of the United States” (WOTUS) and the anticipated U.S. Supreme Court matter, County of Maui v. Hawai’i Wildlife Fund, the scope of the federal government’s authority under the Clean Water Act (CWA) could remain in flux.
Even before its publication in the Federal Register, opponents of the WOTUS rulemaking vowed to file legal challenges. Furthermore, a recently announced settlement in the County of Maui case could prevent the Supreme Court from deciding whether point source discharges that travel through groundwater before reaching a jurisdictional surface water are regulated by the CWA. The threatened legal action on the WOTUS rulemaking and the announced settlement in County of Maui could prevent regulated parties from receiving much needed clarity on key jurisdictional issues under the CWA.
WOTUS final repeal rule and new definition
Step 1. On September 12, the U.S. Environmental Protection Agency (EPA) and the Army Corps of Engineers released a pre-publication version of a final rule repealing the Obama administration’s 2015 rule redefining WOTUS under the CWA, typically referred to as the “Clean Water Rule” (CWR). The repeal rule becomes effective 60 days after publication in the Federal Register, which had not yet occurred as of October 7. Major national environmental groups and states have already
vowed to challenge the rulemaking.
The final repeal rule could end the existing regulatory patchwork where the CWR’s definition currently is in place in 22 states (including Pennsylvania) and the pre-2015 definition of WOTUS is in effect in 27 states and recodify the pre-2015 definition of WOTUS consistently across the United States. According to the EPA and
Corps, restoring the pre-2015 CWA jurisdictional regime is appropriate to remedy the identified deficiencies in the CWR’s expansive WOTUS definition.
However, while regulated parties have a long track record of implementing the pre-2015 definition, as informed by applicable guidance documents and
Supreme Court precedent, the pre-2015 definition of WOTUS has also been criticized as leading to inconsistent determinations based on its case-by-case approach to determining whether a water is subject to CWA jurisdiction. Furthermore, the pre-2015 definition of WOTUS is the subject of a fractured U.S. Supreme Court decision in Rapanos v. United States, 547 U.S. 715 (2006), which has been inconsistently applied by federal appellate courts. With challenges to the repeal rule expected
when finalized, the repeal rule may not provide needed clarification to the regulated community. Litigation likely will be filed in multiple federal district courts. The regulatory patchwork of different WOTUS definitions may continue if any of these lawsuits is successful in obtaining a stay of the repeal rule.
Step 2. The repeal rule completes step one of the agencies’ two-step process to implement a 2017 executive order issued by President Trump. Step two of the process involves replacing the CWR’s definition of WOTUS with a revised definition of the term. On February 14, the agencies published a proposed rule to revise the definition of WOTUS. The comment period on the proposed rule ended on April 15. The agencies reportedly received and are reviewing more than 621,000 comments on this proposed definition. EPA’s senior water official has indicated that the agencies plan to take final action on the proposed revised definition of WOTUS by this winter.
Litigation in the district courts challenging any revised WOTUS definition is a near certainty, with the potential for one or more stays of the new definition if any such challenges are successful. Arguably, any stay or stays could result in a new patchwork of WOTUS definitions, where some states rely on the new definition and other states rely on an older definition of WOTUS.
Potential County of Maui settlement
On November 6, the U.S. Supreme Court is scheduled to hear oral argument in the first groundwater “conduit theory” case to reach it, the County of Maui matter. As background, environmental groups sued the County of Maui alleging CWA violations when treated sanitary effluent that it injected into four permitted underground injection wells traveled underground some distance through groundwater before reaching the Pacific Ocean roughly 80 days later. Background articles regarding “conduit theory” can be found in the November 2018 issue of The PIOGA Press and on Babst Calland’s website.
In February 2019, the Supreme Court agreed to review the Ninth Circuit’s February 1, 2018, decision holding that the CWA regulates discharges of pollutants that reach jurisdictional surface waters after traveling through hydrologically connected groundwater. More specifically, the Supreme Court granted a petition for a writ of certiorari to decide “whether the CWA requires a permit when pollutants originate from a point source but are conveyed to navigable waters by a nonpoint source, such as groundwater.”
The Ninth Circuit held that the wells at issue were “point sources,” and so long as pollutants are “fairly traceable” from the “point source” and more than a de minimis amount of pollutants reach a jurisdictional surface water, such discharges are regulated under the CWA. Hawai’i Wildlife Fund v. County of Maui, 886 F.3d 737, 749 (9th Cir. 2018).
County of Maui is the first “conduit theory” case that the Supreme Court has agreed to hear, with the Fourth, Sixth and Ninth Circuit Courts clearly split on how to apply CWA liability. The Fourth Circuit generally agreed with the Ninth Circuit’s interpretation extending CWA liability for migrating groundwater contamination in Upstate Forever v. Kinder Morgan Energy Partners, L.P., 887 F.3d 637 (4th Cir. 2018).
The Upstate Forever matter involves allegedly ongoing contamination from a previously repaired gasoline pipeline, a very different set of underlying facts as compared with County of Maui. The Fourth Circuit concluded that pollutants originating from a point source (i.e., the ruptured pipeline) that continue to migrate through groundwater with a “direct hydrologic connection” to surface water are regulated by the CWA, even though the pipeline leak had been repaired almost immediately and was being addressed under state remediation requirements. In contrast, subsequent decisions by the Fourth and Sixth Circuits involving inactive coal ash impoundments and landfills have found that such structures are not “point sources” under the CWA. Sierra Club v. VEPCO, 903 F.3d 403 (4th Cir. 2018); Tenn. Clean Water Network v. Tenn. Valley Auth., 905 F.3d 436 (6th Cir. 2018); Ky. Waterways Alliance v. Ky. Utilities Co., 905 F.3d 925 (6th Cir. 2018).
Recent developments, however, may prevent the Supreme Court from deciding the County of Maui matter. On September 20, the Maui County Council voted 5- 4 to settle the pending petition and for the County to seek a CWA National Pollutant Discharge Elimination System (NPDES) permit. The mayor of Maui County, however, has indicated that county council does not have the authority to withdraw the appeal on its own, and that the mayor has the ability to make the ultimate decision as to whether the Supreme Court petition remains on the docket. As of the publication of this article, the dispute over who has the authority (i.e., county council or mayor) remains unresolved.
The potential withdrawal of County of Maui matter would mean that the Supreme Court would not resolve the circuit split on the scope of the CWA’s NPDES permit program, at least for now. A petition to review the Fourth Circuit’s decision in Upstate Forever is also pending. If the County of Maui appeal is withdrawn, the Supreme Court could take up the Upstate Forever case at some point in the future. Meanwhile, EPA’s April 2019 interpretive guidance, concluding that releases of pollutants to groundwater are categorically excluded from the CWA’s NPDES permitting requirement, remains in effect nationwide, except for the Fourth and Ninth Circuits. Therefore, until the Supreme Court resolves the circuit split, regulated parties in the Fourth and Ninth Circuits, including members of the oil and gas industry, will be subject to potentially more expansive requirements under the CWA.
Clarity on key CWA jurisdictional issues hangs in the balance as litigants prepare to challenge the agencies’ final repeal rule and jockeying continues on the potential settlement in the County of Maui matter. Babst Calland is actively monitoring these developments and evaluating their potential effect across sectors and industries, including the oil and gas sector. If you have any questions, please contact Lisa M. Bruderly at 412-394-6495 or lbruderly@babstcalland.com or Gary E. Steinbauer at 412-394-6590 or gsteinbauer@babstcalland.com.
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Capito Joins Leading Energy Law Firm as Shareholder Based in Charleston, WV Office
Babst Calland today announced that West Virginia native Moore Capito has joined the firm’s Charleston office as a shareholder and member of its Corporate and Commercial, Emerging Technologies, and Energy and Natural Resources Groups, effective September 30, 2019.
For the past decade, Moore Capito has worked for Charleston-based Greylock Energy, formerly known as Energy Corporation of America, where he most recently served as Corporate Counsel and Director of Land.
“I am excited to be joining a well-respected legal team in West Virginia representing such a wide range of clients in West Virginia and throughout the country,” said Capito.
“Moore Capito is well-known in industry and among local, state and federal regulatory agencies and the legislature in West Virginia. We’re very pleased to have him become part of our team,” said Don Bluedorn, Babst Calland’s Managing Shareholder. “His proven leadership and passion for natural gas development and West Virginia are great fits for our entire team, and most importantly for our clients.”
Moore Capito spent the first part of his career in public service, including as a staff member for the Secretary of Defense at the Pentagon after he served as a member of The White House advance team traveling in support of the president. His first assignment in Washington, D.C. was working for the House Majority Leader in the United States House of Representatives. Following his assignment at the Pentagon, Mr. Capito attended law school and received his Juris Doctorate from Washington and Lee University in 2011. He holds a Bachelor of Arts degree from Duke University.
Mr. Capito, son of U.S. Senator for West Virginia Shelley Moore Capito and grandson of the late former West Virginia Governor Arch Moore, was elected in 2016 to the West Virginia House of Delegates for the 35th District. In this capacity, Attorney Capito also served on the West Virginia Legislature’s Joint Committee on Natural Gas Development and has served as Chairman of the Committee on Enrolled Bills, Vice Chair of the Committee on the Judiciary, as a member of the Banking and Insurance Committee, Political Subdivisions Committee, and Technology and Infrastructure Committee.
“We are thrilled to have Moore join our team in Charleston,” said Steve Green, Managing Shareholder of Babst Calland’s Charleston office. “His experience at the federal and state levels, and his commitment to the oil and gas industry, is a welcome addition to our practice and clients.”
Moore is an active member of the Charleston community, including participating with organizations such as the Rotary Club of Charleston. He and his wife, Katie, reside in Charleston with their two children Eliza and Arch.
The Legal Intelligencer
(by Gary Steinbauer)
Since taking office, President Donald Trump has launched an ambitious deregulatory effort targeting several federal environmental rulemakings completed during the Obama administration. Two of the most noteworthy deregulatory actions involve the scope of the federal government’s authority to regulate greenhouse gas (GHG) emissions from existing sources under the Clean Air Act and discharges to surface water under the Clean Water Act. Lawsuits over these rules are pending or promised, with federal courts, and potentially the U.S. Supreme Court, poised to rule on whether the Trump administration’s actions are appropriate course corrections or themselves illegal.
Clean Air Act
In 2015, the Obama administration promulgated the first-ever requirements for GHG emissions from power plants under the Clean Air Act. Known as the Clean Power Plan (CPP), this rule aimed to reduce GHG emissions from electricity generating units to approximately 32% less than 2005 levels by 2030. The CPP was challenged by numerous states and industry groups in the U.S. Court of Appeals for the District of Columbia Circuit. Challengers asserted that the Clean Air Act requirement to establish the “best system of emissions reduction” (BSER) prohibited the U.S. Environmental Protection Agency (EPA) from forcing fossil fuel plants to offset their emissions by constructing renewable energy sources or purchasing credits from such sources. In February 2016, the Supreme Court took the unprecedented step of staying the CPP before the D.C. Circuit ruled on the merits of the challenge. In September 2016, the entire D.C. Circuit heard oral arguments on the CPP, but effectively stayed the CPP lawsuit while the EPA moved forward with preparing a replacement.
On June 19, the EPA issued a final Affordable Clean Energy (ACE) rule establishing a much different set of requirements for BSER at existing power plants and formally repealing the CPP. Finalized after formal notice-and-comment rulemaking, the ACE rule adopts a series of thermal efficiency or heat rate improvements as BSER, but unlike the CPP, it does not set a formal limit on GHG emissions from existing coal-fired power plants. Effectively, the ACE rule requires coal-fired electricity generating units to reduce GHG emissions by employing operation and maintenance practices, using one of six listed “candidate technologies” each with its own pre-determined GHG emissions reductions, and evaluating other factors such as the source’s remaining useful life. Under the ACE rule, states are required to submit plans to the EPA describing how each affected power generation unit within their jurisdiction meets the required “standards of performance.”
On July 8, the same day the ACE rule was published in the Federal Register, public health interest groups filed a lawsuit challenging the rule, which was followed by challenges by more than 25 states (including Pennsylvania), environmental groups and a coal mining company. Industry groups, power generation, mining companies, states and others have moved to intervene in these lawsuits to defend the ACE rule. The EPA has asked the D.C. Circuit to fast-track the litigation, and challengers have opposed the EPA’s request and asked the D.C. Circuit to hold the case in abeyance until the EPA completes a related rulemaking. The court has yet to rule on these competing motions.
The legal challenges to the ACE rule, as well as the ongoing litigation over the CPP, will determine the extent to which the EPA can regulate GHG emissions from existing power plants under the Clean Air Act. If the Supreme Court’s unprecedented stay of the CPP is any indication, the ACE rule lawsuits and the ongoing challenges to the merits of the CPP have all the necessary ingredients for an environmental court battle for the ages, one that could ultimately reach the Supreme Court.
Clean Water Act
On the water side, a different campaign is being waged. In 2015, the same year that it promulgated the CPP, the Obama administration issued a rule re-defining “waters of the United States” (WOTUS) under the Clean Water Act, which arguably expanded the federal government’s jurisdiction over surface water, including wetlands. The Obama-era definition of WOTUS, typically referred to as the Clean Water Rule (CWR), invoked intense opposition by many states and regulated parties. Opponents filed lawsuits challenging the CWR almost immediately, with the initial battle involving whether the federal appellate or district courts were responsible for deciding the matters. The CWR was stayed until 2018. In 2018, the Supreme Court issued a unanimous decision holding that challenges to the CWR must be filed in federal district courts.
The Supreme Court’s 2018 decision requiring federal district courts to hear the CWR challenges led to the existing regulatory patchwork, where the CWR’s WOTUS definition currently is in place in 22 states (including Pennsylvania) and the pre-2015 definition of WOTUS is in effect in 27 states. The Trump administration has used the existing regulatory patchwork to justify repealing the CWR and introducing a new definition of WOTUS. The EPA and the U.S. Army Corps of Engineers (Corps) (collectively, the agencies) have established a two-step process for repealing and potentially replacing the CWR. Step one is to repeal the CWR and recodify the pre-CWR definition and regulatory regime for defining and interpreting WOTUS. The agencies will soon complete step one. On Sept. 12, the agencies released a pre-publication version of the final rule repealing the CWR. The “repeal rule” becomes effective 60 days after publication in the Federal Register, which, as of Sept. 30, had not yet occurred. Once final, the “repeal rule” will recodify the pre-2015 definition of WOTUS consistently across the United States.
Major national environmental groups and states have already vowed to challenge the “repeal rule.” These challenges, which could be filed in multiple federal district courts, will center on whether the agencies’ repeal of the CWR was arbitrary and capricious under the federal Administrative Procedures Act and whether the agencies have marshaled an appropriate justification for limiting federal jurisdiction under the Clean Water Act four years after the CWR was finalized. The regulatory patchwork of WOTUS definitions may continue if any of these lawsuits are successful in staying the repeal rule.
Concurrently, the Trump administration and its opponents are gearing up for another clash involving step two of the CWR revocation process—finalizing a potential replacement definition of WOTUS. The agencies initiated step two on Feb. 14, when they published a proposed revised definition of WOTUS that would generally limit federal jurisdiction to relatively permanent, standing or continuously flowing surface waters and their adjacent wetlands. The agencies indicate that they are currently reviewing more than 621,000 public comments that they received on the February 2019 proposed WOTUS definition. They expect to take final action in early 2020. As with the “repeal rule,” any new definition of WOTUS inevitably will lead to additional litigation.
As the Trump administration moves from delaying or suspending Obama-era environmental regulations to fashioning its own replacements, legal challenges are a near certainty. The scope of the EPA’s authority to regulate GHG emissions under the Clean Air Act and discharges to surface water under the Clean Water Act will be determined initially by federal appellate and district court judges, with a strong possibility of the Supreme Court serving as the final arbiter.
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Reprinted with permission from the October 3, 2019 edition of The Legal Intelligencer © 2019 ALM Media Properties, LLC. All rights reserved.
Pipeline Safety Alert
(by James Curry, Keith Coyle and Brianne Kurdock)
On October 1, 2019, the Pipeline and Hazardous Materials Safety Administration (PHMSA) published a final rule in the Federal Register amending the federal safety standards for hazardous liquids pipelines at 49 C.F.R. Part 195 (84 Fed. Reg. 52260) (Rule). The publication of the Rule ends a nearly decade-long rulemaking process that began in the wake of a significant pipeline accident in Marshall, Michigan. A prior version of the Rule, released in the closing days of the Obama administration, was returned to PHMSA for further review pursuant to a White House memorandum issued at the start of the Trump administration. This version of the Rule reflects changes that PHMSA made after receiving input from the current administration, the most significant of which is the removal of new requirements for performing pipeline repairs. The effective date of the Rule is July 1, 2020.
What’s in the Rule?
The Rule includes the following changes to Part 195:
- Extension of reporting requirements to previously-unregulated gravity lines. Operators of gravity lines must submit annual, accident, and safety-related condition reports to PHMSA. The accident and safety-related reporting requirements become effective on January 1, 2021, whereas the annual reporting requirement become effective on March 31, 2021. The Rule contains a narrow exemption from the reporting requirements for low-stress gravity lines that travel no farther than one mile from a facility boundary without crossing any waterways used for commercial navigation. The requirements to provide immediate notification of certain accidents, to submit information to the National Pipeline Mapping System, and to provide safety data sheets after a release do not apply to gravity lines.
- Extension of reporting requirements to previously-unregulated gathering lines. Operators of previously-unregulated gathering lines must submit annual, accident, and safety-related condition reports to PHMSA. As with the reporting requirements for gravity lines, the accident and safety-related condition reporting requirements become effective on January 1, 2021, and the annual reporting requirement become effective on March 31, 2021. The requirements to provide immediate notification of certain accidents, to submit information to the National Pipeline Mapping System, and to provide safety data sheets after a
release do not apply to previously-unregulated gathering lines.
- 72-hour inspections after extreme weather events. Operators are required to perform inspections of all pipeline facilities that are potentially affected by an extreme weather event that has a likelihood of damage to infrastructure by scouring or movement of soil surrounding the pipeline. Examples of extreme weather events include tropical storms, hurricanes, floods exceeding river, shoreline, or creek-high water banks, landslides, or earthquakes. The operator has 72 hours after the cessation of the event (i.e., when the affected area can be safely accessed by personnel and equipment necessary to perform an inspection) to perform the inspection, unless the operator notifies PHMSA that it is unable to commence inspection due to the unavailability of necessary personnel or equipment. The inspection method is to be determined by the operator based upon consideration of the nature of the event and characteristics of the pipeline. Appropriate remedial action must be taken based upon the results of the inspection and may include reducing the operating pressure, repairing or replacing damaged pipeline facilities, or shutting down the pipeline.
- Pipeline assessments for non-IM segments. Operators of onshore pipeline segments that are piggable and which are not currently subject to integrity management (IM) program requirements must perform integrity assessments at least once every 10 years, including an initial assessment by October 1, 2029. Integrity assessments must be performed using inline inspection (ILI) tools or, where impracticable based on operational limits, an acceptable alternative technique such as pressure testing, external corrosion direct assessment, or other technology (upon notification to Office of Pipeline Safety). Qualified personnel must analyze the results within 180 days after the assessment to determine whether a condition exists that could adversely affect safe operation of the pipeline, unless the operator notifies PHMSA that meeting the 180-day is impractical. Conditions that could adversely affect the safe operation of a pipeline must be remediated pursuant to the existing repair criteria in Part 195.
- Leak detection. All hazardous liquids pipelines, except for offshore gathering lines and regulated onshore gathering lines, must have an effective leak detection system. The compliance deadline for pipelines constructed on or after October 1, 2019, is October 1, 2020. The compliance deadline for pipelines constructed prior to October 1, 2019, is October 1, 2024. In implementing these requirements, operators must perform an evaluation to determine what kinds of systems are necessary to adequately protect the public, property, and the environment.
- Accommodation of ILI tools. All hazardous liquids pipelines in HCAs and areas that could affect HCAs must be capable of accommodating ILI tools within 20 years, unless the basic construction of the pipeline will not accommodate the passage of an ILI tool or if the operator determines that it would abandon the pipeline due to the cost of compliance (subject to PHMSA approval). This requirement does not apply to manifolds, station, tank farm, or storage piping, cross-overs, select offshore piping, other piping for which ILI tools are not commercially available, and for emergencies.
- Incorporation of PIPES Act provisions. Pursuant to statutory mandates in the Protecting our Infrastructure of Pipelines and Enhancing Safety Act of 2016 (PIPES Act), operators must provide the Federal On-Scene Coordinator and emergency responders with a safety data sheet associated with spilled hazardous liquids within six hours of notice to the National Response Center. Operators of underwater hazardous liquid pipeline facilities greater than 150-feet depth within HCAs and which are not offshore must also conduct annual integrity assessments.
- Verification of pipeline segment identification. Operators must verify the identification of segments in or that could affect HCAs on an annual basis. Verification does not necessarily require operators to perform a new segment analysis. Rather, operators must identify the factors used in the original analysis, determine whether any of those factors have changed, and assess whether that change would likely affect the results of the initial identification.
- Updates to IM programs. Operators must perform additional activities relating to information obtained from its IM program, including integration of information and consideration of any spatial relationships among anomalous information, including, for example, evidence of potential corrosion in an area with foreign pipeline crossings, interference from power lines, or evidence of land movement.
What’s not in the Rule?
The Rule does not include two changes to Part 195 that PHMSA proposed at earlier points in the proceedings:
- Pipeline repair requirements. Operators will not be required to comply with the new criteria and remediation schedules for performing pipeline repairs. PHMSA will be considering that issue in a separate rulemaking proceeding.
- Engineering critical assessments. Operators will not be required to perform engineering critical assessments (analytical procedures to determine maximum tolerable flaw sizes in steel pipe to maintain safe operations) in relation to the remediation of certain defects.
What’s next?
Interested parties may petition PHMSA for reconsideration of the Rule by October 31, 2019, or may file a petition in the U.S. Court of Appeals for judicial review by December 29, 2019.
Contact one of the members of Babst Calland’s Pipeline and HazMat Safety team to obtain more information about the implications of PHMSA’s Part 195 Rule or for a redline of the rule.
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Babst Calland announces the deployment of artificial intelligence to the due diligence and contract review process for capturing and managing critical business information in high-volume corporate and commercial transactions.Babst Calland is among early law firm adopters to initiate and implement artificial intelligence, machine learning, and predictive analytics to legal contract review and document management, enhancing efficiency, intelligence and quality while reducing costs for clients.
With the addition of new artificial intelligence software, Babst Calland can now deploy highly-trained machine learning algorithms in its due diligence process resulting in faster, more intelligent contract or document review for clients. The Firm can now rapidly review and execute business contracts quickly and accurately whether the client has 100 or 100,000 documents for review.
Providing measurable value requires experience. Babst Calland and affiliate, Solvaire, have been performing complex due diligence, discovery, and document management projects for clients for more than 20 years. During the past year, together with Solvaire, the firm evaluated numerous options, applications before adopting new artificial intelligence software and designing its proprietary platform with the capacity for handling huge volumes of contracts and documents on an expedited basis.
Now leveraging AI technology, coupled with its proven proprietary process, the firm implements projects more accurately and efficiently than ever before. in fact, manual document review time is cut in half offering clients faster risk assessments and more confident decision-making.
“Clients are demanding more efficiency and enhancements in the due diligence process for complex deals and transactions, requiring more insight from attorneys, as well as more innovative resources to stay one step ahead in a time-sensitive, highly competitive marketplace. Our state-of-the-art approach, along with our systematic process that applies artificial intelligence technology, provides clients with the latest, flexible solution customized to meet their specific business needs,” said Christian Farmakis, shareholder and chairman of the Board at Babst Calland.
Pipeline Safety Alert
(by James Curry, Keith Coyle and Brianne Kurdock)
On October 1, 2019, the Pipeline and Hazardous Materials Safety Administration (PHMSA or the Agency) published a Final Rule in the Federal Register updating its procedural requirements for issuing emergency orders (EO). In 2016, PHMSA issued temporary regulations for issuing emergency orders in an interim final rule (IFR). Unlike the process that ordinarily applies to PHMSA rulemakings under the Pipeline Safety and Administrative Procedure Acts, the Agency issued the temporary EO requirements without providing the public with prior notice or the opportunity to submit comments. The final rule takes effect on December 2, 2019, and includes changes that the Agency deemed necessary based on comments submitted after the IFR.
What is an Emergency Order?
Congress authorized PHMSA to issue EOs in the Protecting Our Infrastructure of Pipelines and Enhancing Safety (PIPES) Act of 2016. In response to an imminent hazard, PHMSA may issue an EO imposing restrictions, prohibitions, or safety measures on pipeline owners and operators. Unlike a Corrective Action Order or a Safety Order, PHMSA may issue an EO to a group of operators that share a common condition or even the entire industry. PHMSA anticipates issuing an EO to respond to natural disasters, when serious flaws are discovered in pipes or in equipment manufacturing processes, or when an accident reveals an industry practice is unsafe. Aggrieved owners and operators may challenge an EO by choosing a formal hearing before an administrative law judge (ALJ) or filing a written response with the Associate Administrator. In either scenario, the Associate Administrator must issue the final decision within 30 days of receipt of a petition for review.
What Did PHMSA Change in the New Final Rule?
PHMSA made several important changes to the process of challenging an EO in the final rule, including:
- Removing the discretion initially afforded to the Associate Administrator to unilaterally determine that no material facts are in dispute;
- Limiting PHMSA’s authority to issue EOs “to the extent necessary to abate the imminent hazard;”
- Providing that all pipeline operators subject to an EO will be personally served;
- Removing the Associate Administrator’s ability to determine that a formal hearing is more appropriate for a particular petition;
- Clarifying that a violation of the pipeline safety regulations can serve as part of the factual basis for an EO, but the Agency would not use an EO to allege or
make findings of violation;
- Acknowledging that the Agency carries the burden of proof to sustain an EO, but that the responsive party bears the burden of proving any affirmative defenses;
- Clarifying that a petition for review seeking a formal hearing and a “substantially similar” petition that does not request a hearing can be consolidated, but that the Agency does not intend to force the non-hearing petitioner to participate in the formal hearing process. The Agency also added a process to de-consolidate a proceeding if changed circumstances warrant such action; and
- Stating that if an emergency order has been in effect for more than 365 days, the Administrator will make an assessment regarding whether the unsafe condition or practice continues to exist. If the imminent hazard still exists, PHMSA will initiate a rulemaking. If it does not exist, the Administrator will rescind the emergency order.
For a more detailed assessment or a redline of this rule, please contact a member of the Pipeline and HazMat Safety Practice group.
Click here for PDF.
Emerging Technologies Alert
Babst Calland announces the deployment of artificial intelligence to the due diligence and contract review process for capturing and managing critical business information in high-volume corporate and commercial transactions.
Babst Calland is among early law firm adopters to initiate and implement artificial intelligence, machine learning, and predictive analytics to legal contract review and document management, enhancing efficiency, intelligence and quality while reducing costs for clients.
With the addition of artificial intelligence software, Babst Calland can now deploy highly-trained machine learning algorithms in its due diligence process resulting in faster, more intelligent contract or document review for clients. The Firm can now rapidly review and execute business contracts quickly and accurately whether the client has 100 or 100,000 documents for review.
Providing measurable value requires experience. Babst Calland and our affiliate, Solvaire, have been performing complex due diligence, discovery, and document management projects for clients for more than 20 years. During the past year, together with Solvaire, the firm evaluated numerous options, applications before adopting new artificial intelligence software and designing its proprietary platform with the capacity for handling huge volumes of contracts and documents on an expedited basis.
Now leveraging AI technology, coupled with our proven proprietary process, we implement projects more accurately and efficiently than ever before. in fact, we cut manual document review time in half offering clients faster risk assessments and more confident decision-making.
Clients are demanding more efficiency and enhancements in the due diligence process for complex deals and transactions, requiring more insight from attorneys, as well as more innovative resources to stay one step ahead in a time-sensitive, highly competitive marketplace. Our state-of-the-art approach, along with our systematic process that applies artificial intelligence technology, provides clients with the latest, flexible solution customized to meet their specific business needs.
About Babst Calland
Babst Calland was founded in 1986 and has represented environmental, energy and corporate clients since its inception. The Firm has grown to more than 150 attorneys who concentrate on the current and emerging needs of clients. This team of attorneys has focused practices in emerging technologies, corporate and commercial, energy and natural resources, environmental, construction, employment and labor, public sector, litigation, transportation safety, and real estate law. Babst Calland has been ranked in the 2019 U.S. News – Best Lawyers® “Best Law Firms” list nationally in seven practice areas and regionally in 29 practice areas.
Headquartered in Pittsburgh, Babst Calland also has offices in State College, Pa., Charleston, W.Va., Washington, D.C., Houston, Texas., Canton, Ohio, Sewell, N.J. Babst Calland’s attorneys have been acknowledged by various organizations, including: U.S. News & World Report’s Best Law Firms, Best Lawyers in America, Pennsylvania Super Lawyers, and Chambers USA’s America’s Leading Lawyers for Business. For more information, including attorney profiles, visit babstcalland.com.
About Solvaire
Solvaire, an affiliate of Babst Calland, was founded in Pittsburgh in 1999. Solvaire provides access to the people, process and technology to quickly unlock volumes of critical business information for clients involved in transactions, litigation and myriad needs of document and contract management. Solvaire focuses on delivering legal project implementation and hosting, along with legal-based, database-driven technology solutions which enable the delivery of complex projects on time and within budget. For more information, visit solvaire.com.