SENATE AMENDED

THE GENERAL ASSEMBLY OF PENNSYLVANIA

HOUSE BILL

INTRODUCED BY BAKER, PICKETT, CAUSER, MAJOR, CARROLL, CLYMER, DAY, DENLINGER, GINGRICH, GOODMAN, GROVE, HARHART, HARKINS, HARRIS, HORNAMAN, KORTZ, MANN, MICOZZIE, MILLARD, MURT, MUSTIO, RAPP, REICHLEY, SAINATO, STERN, VULAKOVICH, WATSON, FLECK, HESS, PERRY, GABLER, SONNEY, GIBBONS, MILNE, PRESTON, MUNDY AND FARRY, JANUARY 31, 2011

SENATOR CORMAN, APPROPRIATIONS, IN SENATE, RE-REPORTED AS AMENDED, DECEMBER 5, 2011   

AN ACT

Amending Title 66 (Public Utilities) of the Pennsylvania

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Consolidated Statutes, in general provisions, further

providing for definitions; providing for regulation of

certain operators of pipelines; and, in violations and

penalties, further providing for civil penalties for gas

pipeline safety violations.

Providing for gas and hazardous liquids pipelines and for powers

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and duties of the Pennsylvania Public Utility Commission; and

imposing civil penalties.

The General Assembly of the Commonwealth of Pennsylvania

hereby enacts as follows:

Section 1.  Paragraph (2) of the definition of "public

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utility" in section 102 of Title 66 of the Pennsylvania

Consolidated Statutes is amended by adding subparagraphs and the

section is amended by adding definitions to read:

§ 102.  Definitions.

Subject to additional definitions contained in subsequent

provisions of this part which are applicable to specific

provisions of this part, the following words and phrases when

used in this part shall have, unless the context clearly

indicates otherwise, the meanings given to them in this section:

* * *

"Natural or artificial gas."  Natural gas, liquefied natural

gas, synthetic natural gas and any natural gas substitute such

as petroleum gas or landfill gas.

* * *

"Petroleum gas."  Propane, propylene, butane, including

normal butane or isobutanes and butylene, including isomers, or

mixtures composed predominately of these gases, having a vapor

pressure not exceeding 208 psi (1434 kPa) gage at 100°F (38°C).

"Public utility."

* * *

(2)  The term does not include:

* * *

(vii)  A pipeline operator, not otherwise a public

utility, provided that the pipeline operator is subject

to the jurisdiction of the commission as provided in

Chapter 32 (relating to safety regulation of nonpublic

utility pipelines) and in regulations promulgated by the

commission.

(viii)  Any person supplying petroleum gas:

(A)  to fill a container or by delivery in a

container; or

(B)  through a pipeline to a customer where the

pipeline system is not subject to Federal safety

regulations under 49 CFR Part 192 (relating to

transportation of natural and other gas by pipeline:

minimum Federal safety standards) exempting from

Federal regulation service to fewer than ten

customers through a pipeline system, if no portion of

the pipeline system is located in a public place, and

service to a single customer through a pipeline

system, if the pipeline system is located entirely on

the customer's premises no matter if a portion of the

pipeline system is located in a public place.

* * *

Section 2.  Title 66 is amended by adding a chapter to read:

CHAPTER 32

SAFETY REGULATION OF NONPUBLIC UTILITY PIPELINES

Sec.

3201.  Definitions.

3202.  Adoption of Federal pipeline safety laws.

3203.  Scope of commission regulation.

3204.  Registry of pipeline operators.

3205.  Assessments.

3206.  Regulations.

3207.  Jurisdiction and authority of commission.

§ 3201.  Definitions.

The following words and phrases when used in this chapter

shall have the meanings given to them in this section unless the

context clearly indicates otherwise:

"Federal pipeline safety laws."  The provisions of 49 U.S.C.

Subtitle VIII (relating to pipelines) and all regulations

promulgated pursuant thereto.

"Gas" and "natural gas."  Natural gas, flammable gas or toxic

or corrosive gas. The term shall have the same meaning as in the

Federal pipeline safety laws.

"Hazardous liquid."  The term shall have the same meaning as

in the Federal pipeline safety laws, including, but not limited

to, carbon dioxide, a highly volatile liquid, petroleum,

petroleum products or anhydrous ammonia.

"Person."  Any individual, firm, joint venture, partnership,

corporation, association, municipality, cooperative association

or joint stock association, including any trustee, receiver,

assignee or personal representative thereof.

"Pipeline."  Any part of the physical facilities through

which gas or hazardous liquids move in transportation and that

is regulated by Federal pipeline safety laws, including a pipe,

valve and other appurtenance attached to the pipe, compressor

unit, metering station, regulator station, delivery station,

holder and fabricated assembly. The term does not include a

pipeline subject to the exclusive jurisdiction of the Federal

Energy Regulatory Commission.

"Pipeline facility."  A new and existing pipeline, right-of-

way and any equipment, facility or building used in the

transportation of gas or hazardous liquids or in the treatment

of gas during the course of transportation and that is regulated

by the Federal pipeline safety laws. The term does not include a

pipeline facility subject to the exclusive jurisdiction of the

Federal Energy Regulatory Commission.

"Pipeline operator."  A person that owns or operates in this

Commonwealth equipment or facilities for the transportation of

gas or hazardous liquids by pipeline or pipeline facility

regulated under Federal pipeline safety laws. The term does not

include a public utility or an ultimate consumer who owns a

service line on the real property of the ultimate consumer.

"Transportation of gas."  The gathering, transmission or

distribution of gas by pipeline or the storage of gas.

"Transportation of hazardous liquids."  The gathering,

transmission or distribution of hazardous liquids by pipeline.

§ 3202.  Adoption of Federal pipeline safety laws.

(a)  General rule.--The safety standards and regulations for

the transportation of gas and hazardous liquids in this

Commonwealth shall be those issued under the Federal pipeline

safety laws and as implemented in 49 CFR Subtitle B Ch. 1 Subch.

D (relating to pipeline safety), including all subsequent

amendments thereto.

(b)  Amendments to Federal law.

(1)  Amendments to the Federal pipeline safety laws shall

have the effect of amending or modifying the commission's

regulations with regard to the safety standards for the

transportation of gas and hazardous liquids.

(2)  The amendment or modification shall take effect 60

days after the effective date of the Federal amendment or

modification.

§ 3203.  Scope of commission regulation.

The commission shall have general administrative authority to

supervise and regulate pipeline operators within this

Commonwealth consistent with Federal pipeline safety laws. The

commission may adopt regulations, consistent with the Federal

pipeline safety laws, as may be necessary or proper in the

exercise of its powers and perform its duties under this

chapter. The regulations shall not be inconsistent with or

greater or more stringent than the minimum standards and

regulations adopted under the Federal pipeline safety laws. The

commission shall have the following powers and duties:

(1)  To investigate any service, act, practice, policy or

omission by a pipeline operator to determine compliance with

this chapter.

(2)  To investigate any pipeline facility to determine if

it is hazardous to life or property under the Federal

pipeline safety laws.

(3)  To investigate the existence or report of any

safety-related condition that involves a pipeline facility.

(4)  To enter into and perform contracts or agreements

with the United States Department of Transportation to

inspect intrastate and interstate transmission facilities

under the Federal pipeline safety laws.

(5)  To accept grants-in-aid, cash and reimbursements

provided for or made available to the Commonwealth by the

Federal Government to carry out the Federal pipeline safety

laws or other Federal law.

(6)  To adopt by reference the pipeline safety

regulations promulgated at 49 CFR Parts 191 (relating to

transportation of natural and other gas by pipeline; annual

reports, incident reports, and safety-related condition

reports), 192 (relating to transportation of natural and

other gas by pipeline: minimum Federal safety standards), 193

(relating to liquefied natural gas facilities: Federal safety

standards), 194 (relating to response plans for onshore oil

pipelines), 195 (relating to transportation of hazardous

liquids by pipeline), 196 (Reserved), 197 (Reserved), 198

(relating to regulations for grants to aid State pipeline

safety programs) and 199 (relating to drug and alcohol

testing). The commission may not adopt a rule or regulation

to implement this chapter that is inconsistent with or more

stringent than the pipeline safety regulations promulgated by

the Federal Government.

(7)  To advise, consult and cooperate with the Federal

Government, other State agencies and other states as may be

necessary to administer its duties under this chapter.

(8)  To issue adjudications, after notice and opportunity

to be heard, and to impose civil fines and take enforcement

action for violations of the applicable Federal regulations

and any provision of this chapter.

(9)  For purposes of petroleum gas, the commission's

jurisdiction under this chapter shall be limited to those

petroleum gas systems that are subject to the Federal

pipeline safety laws and not a public utility.

§ 3204.  Registry of pipeline operators.

(a)  Duty to establish and maintain registry.--The commission

shall establish and maintain a registry of all gas and hazardous

liquids pipeline operators.

(b)  Applications.--The commission may develop an application

for registration under subsection (a) and may charge a

reasonable registration fee and annual renewal registration fee.

(c)  Duty to register.

(1)  A pipeline operator shall register with the

commission.

(2)  A pipeline operator that fails to register in

accordance with this chapter shall be subject to the civil

penalty provided in section 3301(c) (relating to civil

penalties for violations).

(d)  Exemptions.

(1)  No application or registration fee shall be required

of a petroleum gas distributor who is registered under the

act of June 19, 2002 (P.L.421, No.61), known as the Propane

and Liquefied Petroleum Gas Act, and provides proof of

registration to the commission.

(2)  The commission shall verify registrations of

petroleum gas distributors with the Department of Labor and

Industry before requiring a petroleum gas distributor to

register under this section.

(3)  No registration fee or annual renewal registration

fee shall be required of a borough.

(4)  This subsection shall not apply to assessments or

boroughs.

§ 3205.  Assessments.

(a)  Duty to determine.--The commission shall by regulation

or order determine the assessments of pipeline operators in

accordance with this section.

(b)  Fees.

(1)  The commission shall determine an appropriate annual

assessment based on intrastate regulated transmission,

distribution and regulated on-shore gathering pipeline miles,

which fee shall be designed to collect the commission's total

costs, plus a reasonable allocation of indirect costs, of its

gas and hazardous liquids pipeline safety program, excluding

the costs otherwise reimbursed by the Federal Government.

(2)  The assessment shall be paid by all pipeline

operators. The assessment shall not be applicable to natural

gas public utilities, city natural gas distribution

operations or a pipeline operator that is a borough.

(c)  Time for payment.--The assessment shall be due and

payable within 30 days of the notice of amount due from the

commission. The amount of the assessment may be challenged

consistent with the provisions of section 510(c), (d) and (e)

(relating to assessment for regulatory expenses upon public

utilities).

(d)  Reporting of miles.--Each pipeline operator shall, on or

before March 31 of each calendar year, report to the commission

its total intrastate regulated transmission, distribution and

regulated on-shore gathering pipeline miles in operation in this

Commonwealth during the prior calendar year.

(e)  Estimated assessments.--The estimated assessments to be

collected under this section for each fiscal year shall be

subtracted from the final estimate of total expenditures used to

calculate the total assessment on public utilities under section

510(a).

§ 3206.  Regulations.

The commission shall establish regulations to implement this

chapter and may promulgate and enforce binding interim

guidelines.

§ 3207.  Jurisdiction and authority of commission.

(a)  Jurisdiction.--Nothing in this chapter shall give the

commission jurisdiction over any pipeline, not otherwise a

public utility or city natural gas distribution operation, for

purposes of rates or ratemaking or any purpose other than those

set forth in this chapter.

(b)  Landfill gas distribution systems.--The jurisdiction of

the commission over a landfill gas distribution system, not

otherwise a public utility, shall be limited to systems subject

to Federal pipeline safety laws. The commission shall not have

jurisdiction over operations and systems within the property

boundary of the landfill.

(c)  Authority.--Nothing in this chapter grants the

commission additional authority to determine or regulate a

pipeline operator as a public utility as defined in section 102

(relating to definitions) or as a natural gas supplier or

natural gas supply services as defined in section 2202 (relating

to definitions).

Section 3.  Section 3301(c) of Title 66 is amended to read:

§ 3301.  Civil penalties for violations.

* * *

(c)  Gas pipeline safety violations.--Any person or

corporation, defined as a public utility or pipeline operator in

this part, who violates any provisions of this part governing

the safety of pipeline or conduit facilities in the

transportation of natural gas, flammable gas, or gas which is

toxic or corrosive, or of any regulation or order issued

thereunder, shall be subject to a civil penalty [of] not to

exceed [$10,000] $100,000 for each violation for each day that

the violation persists, except that the maximum civil penalty

shall not exceed [$500,000] $1,000,000 for any related series of

violations.

* * *

Section 4.  This act shall take effect in 60 days.

CHAPTER 1

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PRELIMINARY PROVISIONS

Section 101.  Short title.

This act shall be known and may be cited as the Gas and

Hazardous Liquids Pipelines Act.

Section 102.  Definitions.

The following words and phrases when used in this act shall

have the meanings given to them in this section unless the

context clearly indicates otherwise:

"Commission."  The Pennsylvania Public Utility Commission.

"Federal pipeline safety laws."  The provisions of 49 U.S.C.

Ch. 601 (relating to safety), the Hazardous Liquid Pipeline

Safety Act of 1979 (Public Law 96-129, 93 Stat. 989), the

Pipeline Safety Improvement Act of 2002 (Public Law 107-355, 116

Stat. 2985) and the regulations promulgated under the acts.

"Gas."  Natural gas, liquefied natural gas, landfill gas,

synthetic natural gas and other gas as defined under the Federal

pipeline safety laws.

"Hazardous liquid."  Petroleum, a petroleum product,

anhydrous ammonia and other hazardous liquid as defined under

the Federal pipeline safety laws.

"Person."  An individual, firm, joint venture, partnership,

corporation, association, municipality, cooperative association

or joint stock association, including any trustee, receiver,

assignee or personal representative thereof. The term does not

include a public utility.

"Pipeline."  A part of the physical facilities through which

gas or hazardous liquids move in transportation, including a

pipe valve and other appurtenance attached to the pipe,

compressor unit, metering station, regulator station, delivery

station, holder and fabricated assembly. The term only includes

pipeline regulated by Federal pipeline safety laws. The term

does not include a pipeline subject to the exclusive

jurisdiction of the Federal Energy Regulatory Commission.

"Pipeline facility."  A new or existing pipeline, right-of-

way and any equipment, facility or building used in the

transportation of gas or hazardous liquids or in the treatment

of gas or hazardous liquids during the course of transportation.

The term does not include a pipeline facility subject to the

exclusive jurisdiction of the Federal Energy Regulatory

Commission.

"Pipeline operator."  A person that owns or operates

equipment or facilities in this Commonwealth for the

transportation of gas or hazardous liquids by pipeline or

pipeline facility regulated under Federal pipeline safety laws.

The term does not include a public utility or an ultimate

consumer who owns a service line on his real property.

"Public utility."  The term shall mean:

(1)  A public utility as defined in 66 Pa.C.S. § 102

(relating to definitions).

(2)  A city natural gas distribution operation as defined

in 66 Pa.C.S. § 102.

"Transportation of gas."  The gathering, transmission or

distribution of gas by pipeline or the storage of gas.

"Transportation of hazardous liquids."  The gathering,

transmission or distribution of hazardous liquids by pipeline.

"Unconventional formation."  A geological shale formation

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existing below the base of the Elk Sandstone or its geologic

equivalent stratigraphic interval where natural gas generally

cannot be produced at economic flow rates or in economic volumes

except by vertical or horizontal well bores stimulated by

hydraulic fracture treatments or by using multilateral well

bores or other techniques to expose more of the formation of the

well bore.

"Unconventional well."  A borehole bore hole drilled or being

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drilled for the purpose of or to be used for producing oil or

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gas from a geological formation existing below the base of the

Elk Sandstone or its geologic equivalent stratigraphic interval

where oil or gas generally cannot be produced at economic flow

rates or in economic volumes except: by wells stimulated by

hydraulic fracture treatments, by a horizontal well bore or by

using multilateral well bores or other techniques to expose more

of the formation of the well bore the production of natural gas

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from an unconventional formation.

Section 103.  Applicability.

The provisions of this act shall apply only to pipelines,

pipeline operators or pipeline facilities regulated under

Federal pipeline safety laws.

CHAPTER 3

PIPELINE OPERATORS

Section 301.  Registry of pipeline operators.

(a)  Registry.--The commission shall establish and maintain a

registry of all pipeline operators.

(b)  Application.--The commission may develop an application

for registration under subsection (a) and may charge a

reasonable registration fee and annual renewal fee.

(c)  Registration with commission.--

(1)  A pipeline operator shall register with the

commission.

(2)  Failure to register shall subject the pipeline

operator to a civil penalty under section 502.

(3)  The operator of a pipeline in a Class 1 location

that collects or transports gas from an unconventional well

shall report the location of the pipeline by class location

and approximate aggregate miles for inclusion in the

commission's registry.

(d)  Disclosure.--The commission shall require each pipeline

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operator, regardless of class location, to disclose in its

initial registration and in each annual renewal the country of

manufacture for all tubular steel products used in the

exploration, gathering or transportation of natural gas or

hazardous liquids. The commission may develop a disclosure form

and require its use.

(d) (e)  Exemptions.--

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(1)  No application or registration fee shall be required

of a petroleum gas distributor who is registered under the

act of June 19, 2002 (P.L.421, No.61), known as the Propane

and Liquefied Petroleum Gas Act, and provides proof of

registration to the commission.

(2)  The commission shall verify registrations of

petroleum gas distributors within the Department of Labor and

Industry before requiring a petroleum gas distributor to

register under this section.

(3)  No registration fee or annual renewal registration

fee shall be required of a borough.

Section 302.  Adoption of Federal pipeline safety laws.

(a)  General rule.--The safety standards and regulations for

pipeline operators shall be those issued under the Federal

pipeline safety laws as implemented in 49 CFR Subtitle B Ch. I

Subch. D (relating to pipeline safety).

(b)  Amendments to Federal law.--

(1)  Amendments to Federal pipeline safety laws shall

have the effect of amending or modifying the safety standards

and regulations for the transportation of gas and hazardous

liquids in this Commonwealth.

(2)  An amendment or modification under paragraph (1)

shall take effect 60 days after its effective date.

CHAPTER 5

COMMISSION AUTHORITY AND ENFORCEMENT

Section 501.  General powers of commission.

(a)  Commission authority.--The commission shall have general

administrative authority to supervise and regulate pipeline

operators within this Commonwealth consistent with Federal

pipeline safety laws. The commission may adopt regulations,

consistent with the Federal pipeline safety laws, as may be

necessary or proper in the exercise of its powers and perform

its duties under this act. The regulations shall not be

inconsistent with or greater or more stringent than the minimum

standards and regulations adopted under the Federal pipeline

safety law. The commission shall have the following duties:

(1)  To investigate a service, act, practice, policy or

omission by a pipeline operator to determine compliance with

this act.

(2)  To investigate a pipeline transportation facility to

determine if it is hazardous to life or property.

(3)  To investigate the existence or report of a safety-

related condition that involves a pipeline transportation

facility.

(4)  To enter into contracts or agreements with the

United States Department of Transportation to inspect

intrastate or interstate transmission facilities.

(5)  Accept grants-in-aid, cash and reimbursements made

available to the Commonwealth by the Federal Government to

implement Federal pipeline safety laws or other Federal law.

(6)  To advise, consult and cooperate with the Federal

Government, other states and other agencies as may be

necessary to carry out the purposes of this act.

(7)  To enforce the Federal pipeline safety laws and,

after notice and opportunity for a hearing, impose civil

penalties and fines and take other appropriate enforcement

action.

(8)  For purposes of petroleum gas, the commission's

jurisdiction under this act shall be limited to those

petroleum gas systems that are the following:

(i)  Subject to the Federal pipeline safety laws.

(ii)  Not a public utility.

(b)  Compliance.--Each pipeline operator, its officers,

agents and employees, and other persons subject to this act, or

to an order of the commission, or a court under this act, shall

observe, obey and comply with this act and the terms and

conditions of the orders issued hereunder.

Section 502.  Civil penalties.

(a)  Violations.--Any pipeline operator who violates this act

shall be subject to a penalty provided under the Federal

pipeline safety laws or 66 Pa.C.S. § 3301(c) (relating to civil

penalties for violations), whichever is greater.

(b)  Disposition of fines and penalties.--Fines imposed and

civil penalties recovered under this act shall be paid to the

commission. The funds received by the commission under this

subsection shall be paid into the State Treasury, through the

Department of Revenue, to the credit of the General Fund.

Section 503.  Assessments.

(a)  Duty to determine.--The commission shall by regulation

or order determine the assessments of pipeline operators in

accordance with this section.

(b)  Assessments.--

(1)  The commission shall determine an appropriate annual

assessment based on intrastate regulated transmission,

regulated distribution and regulated onshore gathering

pipeline miles. The assessment shall be adjusted to collect

the commission's total costs of the pipeline operators'

portion, excluding the costs otherwise reimbursed by the

Federal Government, of:

(i)  The gas pipeline safety program, plus a

reasonable allocation of indirect costs.

(ii)  The hazardous liquids pipeline safety program.

(2)  The assessment shall be paid by pipeline operators

and shall not be applicable to natural gas public utilities.

(3)  The assessment under this subsection shall not apply

to boroughs.

(c)  Time for payment.--The assessment shall be due and

payable within 30 days from the notice of amount due from the

commission. The amount of the assessment may be challenged by a

pipeline operator consistent with the provisions of 66 Pa.C.S. §

510(c), (d) and (e) (relating to assessment for regulatory

expenses upon public utilities).

(d)  Reporting of miles.--Following the submission of the

original application, each pipeline operator shall, on or before

March 31 of each calendar year, report to the commission its

total intrastate regulated transmission, regulated distribution

and regulated onshore gathering pipeline miles in operation for

the transportation of gas and hazardous liquids in this

Commonwealth during the prior calendar year.

(e)  Estimated fees.--The estimated fees to be collected

under this section for each fiscal year shall be subtracted from

the final estimate of total expenditures used to calculate the

total assessment on public utilities under 66 Pa.C.S. § 510.

Section 504.  Jurisdiction and authority of commission.

(a)  Jurisdiction.--Nothing in this act shall give the

commission jurisdiction over any pipeline operator for purposes

of rates or ratemaking or any purpose other than those set forth

in this act.

(b)  Landfill gas distribution systems.--The jurisdiction of

the commission over landfill gas distribution systems under this

act shall be limited to systems subject to Federal pipeline

safety laws. The commission shall not have jurisdiction over

operations and systems within the property boundary of the

landfill.

(c)  Authority.--Nothing in this act grants the commission

additional authority to determine or regulate a pipeline

operator as a public utility as defined in 66 Pa.C.S. § 102

(relating to definitions) or as a natural gas supplier or

natural gas supply services as defined in 66 Pa.C.S. § 2202

(relating to definitions).

CHAPTER 7

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RELATED ACTIVITIES

Section 701.  Replacement and reconstruction.

(a)  Surface area.--A lease entered into to permit the

replacement or construction of a pipeline carrying natural gas

may include provisions relating to the restoration of the

surface area, including soil or vegetation. A lease with a

public entity may provide for the planting of trees in other

areas of a county or municipality if trees were removed to

replace or construct the pipeline.

(b)  Easements.--

(1)  This subsection applies to the owner or holder of:

(i)  an agricultural easement under the act of June

30, 1981 (P.L.128, No.43), known as the Agricultural Area

Security Law; or

(ii)  a conservation easement under the act of June

22, 2001 (P.L.390, No.29), known as the Conservation and

Preservation Easements Act.

(2)  If a person specified in paragraph (1) enters into a

lease to permit the replacement or construction of a natural

gas pipeline on property located within the agricultural or

conservation easement, the person may request a statement

from the pipeline operator describing the impact of the

pipeline on the public use of the easement.

CHAPTER 11

MISCELLANEOUS PROVISIONS

Section 1101.  Effective date.

This act shall take effect in 60 days.