U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration Part 190 NPRM: Administrative Procedures - 1 -

U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration Background PHMSA published the NPRM on August 13, The comment period closed September 12, Purpose: The NPRM implements statutory mandates, conforms current regulatory language to actual practice, and makes various technical corrections and clarifications. PHMSA received comments from five separate entities, including: –American Gas Association –Association of Oil Pipe Lines/American Petroleum Institute (joint comment), –Interstate Natural Gas Association of America –One pipeline operator and one individual citizen

U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration Changes: Broad Categories The comments were generally supportive of the proposal and focused on : New procedures for petitions for reconsideration; Restrictions on ex parte communications and access to evidence in the hearing process; Timing and deadlines during the enforcement process; and Miscellaneous enforcement procedures

U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration Petitions for Reconsideration: Proposal Current procedures do not designate the petition as the final agency action. The proposed rule clarifies that a respondent must file a petition to exhaust its administrative remedies prior to bringing suit. This provides an opportunity for both parties to correct errors and resolve issues informally. Additionally, a proposed provision on the filing period has been included to conform to the statutory filing period in 49 U.S.C and to set the legal standard of review for other final agency actions.

U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration Petition for Reconsideration: Comments If certain enforcement actions are not stayed pending a decision on a petition for reconsideration, the mandatory petition for reconsideration procedure violates the Administrative Procedures Act (APA). AOPL/API objected to the current requirement that petitions for reconsideration may not present new evidence or arguments without good cause. Proposed four changes: (1) Petitions should not be considered by the Associate Administrator (AA) or the AA’s subordinates, but should undergo independent review; (2) AA should be prohibited from ex- parte communications with the person considering the petition for reconsideration (i.e., like an appeal); and (3) PHMSA should deem a petition denied if not acted upon within 90 days INGAA, AOPL/API, AGA: INGAA:

U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration Ex Parte Communications: General Section 20(a)(1)(E) of the Act requires PHMSA to issue regulations prohibiting ex parte communications that are relevant to the question to be decided in an enforcement case. An ex parte communication is a communication between a party to a pending case and the decision-maker regarding an issue in that case, made outside the presence of the other parties and without prior notice and opportunity for all parties to provide comment or rebuttal. In the July 2011 PHMSA policy statement, the agency explained that ex parte communications with the presiding official are not permitted by the operator, its counsel, or agency staff involved in the investigation and prosecution of the case. This prohibition applies to all communication regarding information, facts, or arguments involving an issue in the case

U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration Ex Parte Communications: Proposal To incorporate this prohibition into Part 190, PHMSA proposes to add paragraph (b) to the newly created Sec : –Enjoining any party to an enforcement proceeding (e.g., respondent, agency employees serving in an investigative or prosecutorial capacity, representatives of either party, etc.) from communicating privately with the decision-maker concerning information that is material to the question to be decided

U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration Ex Parte Communications: Comments AOPL/API and INGAA stated that the Regional Director should not be allowed to submit an evaluation of response material because the Regional Director is involved in the investigation or prosecution of an NOPV under § , but if the Regional Director submits such an evaluation (i.e. the “recommendation”), the operator must have an opportunity to see it and respond. INGAA and AOPL/API also stated that a substitute Presiding Official must have no investigative or prosecutorial functions. INGAA stated that the ex- parte restriction should apply not only to information material to deciding a question in the proceeding to also include the facts, evidence, legal, merits of the case, and the respondent’s credibility and past conduct INGAA, AOPL/API: INGAA:

U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration Separation of Functions: Proposal Section 20(a)(1)(D) of the Act requires PHMSA to issue regulations implementing a “separation of functions” between agency employees involved in the investigation and prosecution of an enforcement case and those involved in deciding the case. PHMSA's current practice is that personnel involved in deciding an enforcement case are not involved in determining the allegations that are made, deciding whether to seek a particular type of enforcement action, or drafting the charging document. On July 12, 2011, PHMSA explained its separation of functions policy in a statement published in the Federal Register (76 FR 40820). To conform Part 190 to the current law & existing practice, PHMSA proposes to add a new Sec that re- states this policy

U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration Separation of Functions: Comments Regional Director (RD) should be unable to serve in both an investigatory/prosecutorial and advisory function. It appears RDs are more appropriately considered to be part of the agency’s prosecutorial function. Therefore, AOPL and API suggest that Section (a) be modified to make clear that Regional Directors will not serve in an advisory function for the agency. The proposed regulations governing hearing procedures, particularly proposed section (i), is one area where the new separation of functions language is implicated. For PHMSA to effectively implement the proposed separation of functions provisions, proposed section (i) must be expanded to affirmatively acknowledge that PHMSA non- decisional employees, including Regional Directors, may not communicate, comment or otherwise participate with the Presiding Official in drafting a recommended decision AOPL/API: INGAA:

U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration Vote Both committees must motion and vote separately. –The Committee recommends the proposed rule, as published in the Federal Register. OR –The Committee does not recommend the proposed rule, as published in the Federal Register