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Industry Urges House Panel to Drop Lawsuit Provision From Pipeline Safety Bill

Several officials with the oil and gas industry told the House Energy and Power Subcommittee on Tuesday that a proposal to reauthorize the Natural Gas Pipeline Safety Act should not include language giving private individuals the right to sue the Transportation Department's Pipeline and Hazardous Materials Safety Administration (PHMSA).

Specifically, Section 15 of the proposed legislation -- also known as the Pipeline Safety Act of 2016 -- would amend the pipeline safety act by stipulating that "a person may bring a civil action in an appropriate district court of the United States for an injunction against the United States government for failure to perform any non-discretionary duty under this chapter."

Last December, the Senate Committee on Commerce, Science and Transportation passed a similar bill -- S2276, also known as the Securing America's Future Energy (SAFE PIPES) Act -- but it did not contain the lawsuit provision (see Daily GPIDec. 9, 2015).

Don Santa, CEO of the Interstate Natural Gas Association of America (INGAA), called the lawsuit provision "ill-advised," according to written testimony.

"It could allow the priorities of individual parties and the judgment of a federal district court judge to supplant the pipeline safety priorities, and the allocation of agency resources, established by PHMSA pursuant to the guidance provided by Congress," Santa said. "INGAA would seriously consider opposing the pipeline safety bill if this provision were included."

Santa added that INGAA suggests that the four-year authorization begin in fiscal year (FY) 2017 and remain effective through FY2020. The current proposal is for the authorization to begin in FY2016, but Santa said that by the time the legislation is enacted, most of FY2016 would have passed.

Ron Bradley, vice president of operations for PECO, concurred. He testified on behalf of the American Gas Association.

"The pervasive judicial role created under the proposed formula under discussion in Section 15 would undermine this balance and shift oversight of the industry away from regulators with decades of experience and expertise and into courts who lack this knowledge and perspective," Bradley said. "I strongly urge you to delete this section and maintain PHMSA's primary role as the regulatory authority of the pipeline industry as Congress intended."

The American Petroleum Institute (API) also opposed Section 15. Andrew Black, CEO of the Association of Oil Pipe Lines, testified on behalf of his organization and API as well. He said the type of lawsuits Section 15 would allow "have earned the moniker 'sue and settle'" because of their abuse.

"'Sue and settle' cases...circumvent public participation with settlement agreements negotiated in private and approved by a court containing quick deadlines for regulatory action, and sometimes even substantive agreements that agencies are reluctant to change given the prior court approval," Black said. He added that "sue and settle" cases also "diminish Congressional oversight of agencies because agencies are bound by settlements reached with private parties, which can require appropriations for compliance and override Congressionally set priorities."

PHMSA Administrator Marie Therese Dominguez told the subcommittee that her agency's funding request for FY2017 would provide funding for 343 aspects of its pipeline safety program, including pipeline inspections and safety research. She added that the agency plans to establish an Accident Investigations Division to analyze pipeline incidents and share its findings with various stakeholders to improve overall safety.

On Monday, INGAA published a report that found property values in five states -- Mississippi, New Jersey, Ohio, Pennsylvania and Virginia -- were unaffected by the construction of nearby interstate natural gas pipelines (see Daily GPI,March 1).

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