US House panel tackles PHMSA emergency powers

OREANDA-NEWS. April 21, 2016. The House Transportation and Infrastructure Committee today approved a bill authorizing funding for the top federal pipeline regulator and granting it powers to issue industry-wide emergency orders.

The Pipeline and Hazardous Materials Safety Administration (PHMSA) has asked for emergency order authority in part to bypass a lengthy rulemaking process that it says does not keep up with technological changes in the industry. The agency has failed to complete 16 pipeline safety mandates in the 2-3 year period that Congress set in late 2011.

PHMSA points out that other transportation safety agencies, such as the Federal Railroad Administration, have similar powers. But oil and natural gas pipeline groups have expressed concerns about the new powers PHMSA may receive, saying that an open-ended authority would deprive operators of due process protections. Pipeline safety regulators at present can issue corrective orders to a single operator.

An amendment offered by Railroads, Pipelines and Hazardous Materials subcommittee chairman Jeff Denham (R-California) and adopted by the full committee addressed the concerns raised by the industry. The bill, including Denham's amendment, would allow PHMSA to impose corrective orders on pipeline operators without prior notice or a hearing to address an imminent hazard, but only if a formal proceeding to address such a hazard cannot be completed by a "reasonably foreseeable" date.

The Association of Oil Pipe Lines and the Interstate Natural Gas Association of America said today they would support the bill with the Denham amendment.

PHMSA will have 60 days after the bill becomes law to issue temporary rules for issuing emergency orders and another 210 days to complete final rulemaking on its emergency powers.

The bill, called the PIPES Act of 2016, would allocate \\$518mn to PHMSA over a four-year period, starting in the fiscal year 2016. That compares with a \\$364mn budget in the previous re-authorization bill.

The bill would require PHMSA to set first-time national safety standards for underground gas storage facilities. The agency will have to report to Congress every 90 days on its progress in finishing delayed pipeline safety regulations.

The Transportation and Infrastructure Committee version of the bill is broadly similar to the draft pipeline safety legislation the House Energy and Commerce Committee discussed last month. The Energy and Commerce Committee could vote on the draft as early as next month, clearing the path for the bill to move to the full House.

The Senate already has approved its version of the bill. The Senate bill does not bestow emergency order powers on PHMSA. A conference committee between the chambers will craft a final version of the bill. Pipeline safety bills typically have passed in Congress with broad bipartisan support.