CAL FIRE/ OFFICE OF THE STATE FIRE MARSHAL

Topics: 1. New Pipeline Safety Laws 2. Regulation Workgroup 3. Fee Increase 4. Out-of-Service Pipelines CAL FIRE/ OFFICE OF THE STATE FIRE MARSHAL

RECENT INCIDENT THE RECENT PIPELINE INCIDENT AT REFUGIO BEACH IN SANTA BARBARA COUNTY SPILLED OVER 100,000 GALLONS OF CRUDE OIL AND IMPACTED OVER 25 MILES OF COASTLINE AND OCEAN WATER. THE IMPACTS FROM THE SPILL WERE DEVASTATING, BOTH ENVIRONMENTALLY AND ECONOMICALLY.

NEW LEGISLATION SB 295 AND AB 864 WERE RECENTLY SIGNED INTO LAW TO ADDRESS THE ISSUE OF PIPELINE SAFETY. THE REQUIREMENTS IN THESE NEW LAWS WOULD SIGNIFICANTLY INCREASE THE WORKLOAD FOR CALFIRE/OSFM PIPELINE SAFETY DIVISION.

SENATE BILL 295 SB 295 REQUIRES THE CAL FIRE/OSFM TO: CONDUCT ANNUAL INSPECTIONS OF PIPELINE OPERATORS AND THEIR PIPELINES BEGINNING JANUARY 1, ADOPT REGULATIONS REGARDING ANNUAL INSPECTIONS BY JANUARY 1, ADOPT REGULATION TO INCREASE THE FEES ASSESSED ON PIPELINE OPERATORS IN ORDER TO PAY FOR THE HIGHER NUMBER OF INSPECTIONS.

ASSEMBLY BILL 864 AB 864 REQUIRES THE CAL FIRE/OSFM TO DEVELOP REGULATIONS BY JULY 1, 2017, WHICH INCLUDE: INCLUDE RESEARCHING THE USE OF BEST AVAILABLE TECHNOLOGY ON PIPELINES TO REDUCE THE AMOUNT OF OIL RELEASED IN AN OIL SPILL. CREATING A DEFINITION OF AUTOMATIC SHUTOFF SYSTEMS. DEVELOPING A PROCESS TO ASSESS THE ADEQUACY OF THE PIPELINE OPERATOR’S RISK ANALYSIS.

ASSEMBLY BILL 864 AB 864 REQUIRES THE CALFIRE/OSFM TO DEVELOP REGULATIONS BY JULY 1, 2017, WHICH INCLUDE: DEVELOPING A PROCESS BY WHICH AN OPERATOR MAY REQUEST CONFIDENTIAL TREATMENT OF INFORMATION SUBMITTED IN THEIR PLAN OR CONTAINED IN ANY DOCUMENTS ASSOCIATED WITH THE RISK ANALYSIS. DETERMINE HOW NEAR TO AN ENVIRONMENTALLY AND ECOLOGICALLY SENSITIVE AREA A PIPELINE MUST BE TO BE SUBJECTED TO REGULATION BASED ON THE LIKELIHOOD OF THE PIPELINE IMPACTING THOSE AREAS.

IMPLEMENTATION THE DEPARTMENT IS WORKING ON THE BCP AND THE IMPLEMENTATION OF THESE NEW LAWS. THE DEPARTMENT IS REQUESTING 17 NEW POSITIONS STARTING JULY 2016.

REGULATION DEVELOPMENT THE DEPARTMENT WILL SET UP THE REGULATIONS WORKGROUP. THE FIRST WORKGROUP MEETING WILL BE HELD ON JANUARY 26, 2016 FROM 10 AM TO 1 PM AT: California African American Museum 700 Exposition Park Drive Los Angeles, CA 90037

REGULATION WORKGROUP TO ENSURE COMPLIANT, THE PIPELINE SAFETY DIVISION (PSD) HAS THE RESPONSIBILITY TO ESTABLISH A WORKGROUP WITH ALL APPROPRIATE LEVEL OF COMPETENCY AND EXPERTISE TO DEVELOP THE NEW REGULATIONS. THE WORKGROUP WILL HAVE EXTENSIVE DISCUSSION AND ANALYSIS RESULTING IN PROPOSED REGULATIONS THAT ARE ESSENTIAL FOR THE SUCCESSFUL IMPLEMENTATION OF THE NEW LAWS.

REGULATION WORKGROUP CAL FIRE/OSFM STAFF CHAIRPERSON – SUPERVISING PIPELINE SAFETY ENGINEER (1) ASSOCIATE GOVERNMENTAL PROGRAM ANALYST (1) PIPELINE SAFETY ENGINEER (1) RESEARCH PROGRAM SPECIALIST I – GIS (1)

REGULATION WORKGROUP STAKEHOLDERS PIPELINE OPERATOR REPRESENTATIVE – INTEGRITY MANAGEMENT (1) PIPELINE OPERATOR REPRESENTATIVE – DOT COMPLIANT (1) PIPELINE OPERATOR REPRESENTATIVE – CONSTRUCTION (1) PIPELINE OPERATOR REPRESENTATIVE – CATHODIC PROTECTION (1) PIPELINE OPERATOR REPRESENTATIVE – LEAK DETECTION (1) PIPELINE CONTRACTOR (1) PIPELINE OPERATOR REPRESENTATIVE – SMALL OPERATOR (1) PIPELINE OPERATOR REPRESENTATIVE – LARGE OPERATOR (1) ASSOCIATION REPRESENTATIVE (2) ENGINEERING/TECHNICAL REPRESENTATIVE (2) OTHER PUBLIC AGENCIES (2) NOTE- COMPOSITION OF WORKDROUP SUBJECT TO CHANGE DEPENDING ON AVAILABITITY OF REPRESENTATIVES.

REGULATION WORKGROUP KICK OFF MEETING ON JANUARY 26, 2016 WORKGROUP WILL MEET AT LEAST ONCE A MONTH FOR THE NEXT SIX MONTHS MEETINGS WILL BE IN SACRAMENTO AND SOUTHERN CALIFORNIA DEPENDING ON THE LOGISTICS OF THE WORKGROUP.

REGULATION WORKGROUP THE WORKGROUP’S CHAIR WILL ESTABLISH MEETING DATES, LOCATIONS, AND AGENDAS. ALL MEMBERS WILL PARTICIPATE IN SCHEDULED MEETINGS AND CONFERENCE CALLS WHEN POSSIBLE. MEETING MINUTES WILL BE COMPLETED BY OSFM STAFF AND POSTED ON THE OSFM WEBSITE.

REGULATION WORKGROUP CONT’ MEMBERS WILL PROVIDE TIMELY REVIEW AND COMMENT ON DRAFT DOCUMENTS. MEETINGS WILL BE HELD MONTHLY OR AS FREQUENTLY AS NECESSARY. SUB-WORKGROUPS MAY BE ESTABLISHED TO ADDRESS SPECIFIC TECHNICAL ISSUES; SUB WORKGROUP MEETINGS WILL BE HELD ON AN AS-NEEDED BASIS.

GOALS OF WORKGROUP DEVELOP REGULATIONS (CALIFORNIA CODE OF REGULATIONS, TITLE 19). REVIEW AND EVALUATE EXISTING INSPECTIONS AND LEAK TRENDS TO DETERMINE THE BEST APPROACH FOR THE NEW “ANNUAL INSPECTION” REGULATIONS. DEVELOP THE PROPOSED REGULATION THAT WILL REDUCE PIPELINE ACCIDENTS ON INTRASTATE HAZARDOUS LIQUID PIPELINES.

GOALS OF WORKGROUP CONT CREATE A DEFINITION OF AUTOMATIC SHUTOFF SYSTEMS. RESEARCH AND IDENTIFY THE BEST AVAILABLE TECHNOLOGIES FOR LEAK DETECTION AND AUTOMATIC SHUT OFF SYSTEMS. DETERMINE HOW NEAR TO AN ENVIRONMENTALLY AND ECOLOGICALLY SENSITIVE AREA A PIPELINE MUST BE TO BE SUBJECT TO REGULATION BASED ON THE LIKELIHOOD OF THE PIPELINE IMPACTING THOSE AREAS.

GOALS OF WORKGROUP CONT DEVELOP A PROCESS TO ASSESS THE ADEQUACY OF THE PIPELINE OPERATOR’S RISK ANALYSIS. DEVELOP A PROCESS BY WHICH AN OPERATOR MAY REQUEST CONFIDENTIAL TREATMENT OF INFORMATION SUBMITTED IN THEIR PLAN OR CONTAINED IN ANY DOCUMENTS ASSOCIATED WITH THE RISK ANALYSIS. PROPOSE REGULATION FOR FEE INCREASE THAT IS NECESSARY TO COVER THE COSTS OF OPERATIONS.

SALARY ADJUSTMENT CALFIRE/OSFM PIPELINE SAFETY DIVISION WAS OPERATING AT 70% VACANCY RATE FOR THE PIPELINE SAFETY ENGINEER (PSE) POSITION DUE TO THE RECRUITMENT AND RETENTION ISSUE. THE DEPARTMENT OF HUMAN RESOURCE (CALHR) ADJUSTED THE SALARIES TO A COMPETITIVE LEVEL FOR PIPELINE SAFETY ENGINEERS AND SUPERVISING PIPELINE SAFETY ENGINEERS.

FEE INCREASE SB 295 REQUIRES THE CAL FIRE/OSFM TO RAISE THE FEE IN ORDER TO OFFSET THE ADDITIONAL COST OF CONDUCTING ANNUAL INSPECTIONS AND TO IMPLEMENT THE REQUIREMENT OF SB 295 AND AB 864. THE OSFM IS PROPOSING TO INCREASE THE “CHARGE PER MILE OF PIPELINE OPERATED”. THIS PROPOSAL WOULD PROVIDE THE APPROPRIATE FEES TO OPERATING THE PROGRAM AND COVER THE COST FOR ADDITIONAL WORKLOADS AND STAFFING. IT SHOULD BE NOTED THAT STATE LAW PROHIBITS THE OSFM FROM CHARGING MORE THAN THE AMOUNT THAT REQUIRED TO OPERATING THE PROGRAM.

FEE INCREASE CONT’ THIS PROPOSAL WILL: ALLOW CAL FIRE/OSFM TO COMPLY WITH THE REGULATORY DEVELOPMENT AND PIPELINE REVIEWS AND INSPECTIONS AS REQUIRED BY AB 864 AND SB 295. REDUCE LIFE AND PROPERTY LOST. REDUCE THE RISK OF FUTURE OIL SPILLS FROM PIPELINES.

FEE INCREASE CONT’ PROVIDE ADEQUATE ENFORCEMENT AND INSPECTION FUNCTIONS OF THE PROGRAM. ENHANCE PUBLIC SAFETY. PROTECT CALIFORNIA’S VITAL NATURAL RESOURCES.

FEE INCREASE CONT’ REDUCE POTENTIAL LITIGATIONS AND FINES FOR THE OPERATOR OF PIPELINES. SAVE MONEY FOR OPERATOR OF PIPELINES IN THE LONG RUN.

WORK GROUP If you are interested in joining the work please contact: DANIEL HASTERT (562) Please have your request in by Friday January 15, 2016

Pipeline Reclassification Notice concerning “Out-of-Service” Pipelines A letter was sent to 19 affected operators in December 2015 advising of changes to our determination of “out of service” pipelines as it relates to jurisdiction, inspection requirements, and assessment of pipeline mileage fees. PHMSA only defines pipelines as either “Active” or “Abandoned”; therefore, in order to comply with federal regulations and interpretations, we have designated “out-of-service” pipelines as “Active” (jurisdictional to the OSFM).

Pipeline Reclassification Notice Definitions ACTIVE pipeline means a pipeline or pipeline segment which is in service whether or not the pipeline is fully operational and includes pipelines which may have been utilized to transport hazardous liquids but are currently static, idle or designated as “out-of- service”. “Active” pipelines must comply with all applicable State and federal laws and regulations pertaining to pipeline safety. ABANDONED pipeline means a pipeline or pipeline segment that is permanently removed from service, which has been safely disconnected from an operating system, purged of combustibles and sealed. Once the process has been verified and accepted in writing by the OSFM, this category of pipeline becomes a non-jurisdictional pipeline. An abandoned pipeline cannot be returned to hazardous liquid service. Before a pipeline can be reclassified as “abandoned”, the operator must submit to the State Fire Marshal, and the State Fire Marshal must approve, a written plan describing the process to be used. Approval of the reclassification plan by the OSFM does not affect or negate any permit or approval requirement of any other agency. OSFM fees are not applicable for “abandoned” pipelines. In addition, “abandoned” pipelines will not need to be reported to the OSFM on the annual Operator Questionnaire: however, the OSFM will maintain the data on these pipelines that had previously been collected during the time the pipelines had been classified as “active”.

Pipeline Reclassification Notice Expectations We provided the operator a list of all pipelines that are currently reported to us as having “out-of-service” segments. The operator is to review this list for accuracy and correctness and advise of any needed corrections prior to April 1, These lines must now be incorporated into the operators integrity management program and be assessed and evaluated for risk to high consequence areas (HCA). A particular focus would be verification and documentation that these pipelines were effectively purged of hazardous liquid, isolated, and pose no threat to affected HCAs. We will be requesting new GIS mapping submissions from all operators with these “out-of-service” segments included. We no longer require written approval to reclassify a line from “active” to “out-of-service” since these lines will remain jurisdictional. Only change would be commodity (i.e.. Nitrogen).

QUESTIONS ???