Appendix A to Part 195 - Delineation Between Federal and State Jurisdiction - Statement of Agency Policy and Interpretation
49:3.1.1.2.11.10.22.1.22 : Appendix A
Appendix A to Part 195 - Delineation Between Federal and State
Jurisdiction - Statement of Agency Policy and Interpretation
In 1979, Congress enacted comprehensive safety legislation
governing the transportation of hazardous liquids by pipeline, the
Hazardous Liquids Pipeline Safety Act of 1979, 49 U.S.C. 2001 et
seq. (HLPSA). The HLPSA expanded the existing statutory
authority for safety regulation, which was limited to
transportation by common carriers in interstate and foreign
commerce, to transportation through facilities used in or affecting
interstate or foreign commerce. It also added civil penalty,
compliance order, and injunctive enforcement authorities to the
existing criminal sanctions. Modeled largely on the Natural Gas
Pipeline Safety Act of 1968, 49 U.S.C. 1671 et seq. (NGPSA),
the HLPSA provides for a national hazardous liquid pipeline safety
program with nationally uniform minimal standards and with
enforcement administered through a Federal-State partnership. The
HLPSA leaves to exclusive Federal regulation and enforcement the
“interstate pipeline facilities,” those used for the pipeline
transportation of hazardous liquids in interstate or foreign
commerce. For the remainder of the pipeline facilities, denominated
“intrastate pipeline facilities,” the HLPSA provides that the same
Federal regulation and enforcement will apply unless a State
certifies that it will assume those responsibilities. A certified
State must adopt the same minimal standards but may adopt
additional more stringent standards so long as they are compatible.
Therefore, in States which participate in the hazardous liquid
pipeline safety program through certification, it is necessary to
distinguish the interstate from the intrastate pipeline
facilities.
In deciding that an administratively practical approach was
necessary in distinguishing between interstate and intrastate
liquid pipeline facilities and in determining how best to
accomplish this, DOT has logically examined the approach used in
the NGPSA. The NGPSA defines the interstate gas pipeline facilities
subject to exclusive Federal jurisdiction as those subject to the
economic regulatory jurisdiction of the Federal Energy Regulatory
Commission (FERC). Experience has proven this approach practical.
Unlike the NGPSA however, the HLPSA has no specific reference to
FERC jurisdiction, but instead defines interstate liquid pipeline
facilities by the more commonly used means of specifying the end
points of the transportation involved. For example, the economic
regulatory jurisdiction of FERC over the transportation of both gas
and liquids by pipeline is defined in much the same way. In
implementing the HLPSA DOT has sought a practicable means of
distinguishing between interstate and intrastate pipeline
facilities that provide the requisite degree of certainty to
Federal and State enforcement personnel and to the regulated
entities. DOT intends that this statement of agency policy and
interpretation provide that certainty.
In 1981, DOT decided that the inventory of liquid pipeline
facilities identified as subject to the jurisdiction of FERC
approximates the HLPSA category of “interstate pipeline
facilities.” Administrative use of the FERC inventory has the added
benefit of avoiding the creation of a separate Federal scheme for
determination of jurisdiction over the same regulated entities. DOT
recognizes that the FERC inventory is only an approximation and may
not be totally satisfactory without some modification. The
difficulties stem from some significant differences in the economic
regulation of liquid and of natural gas pipelines. There is an
affirmative assertion of jurisdiction by FERC over natural gas
pipelines through the issuance of certificates of public
convenience and necessity prior to commencing operations. With
liquid pipelines, there is only a rebuttable presumption of
jurisdiction created by the filing by pipeline operators of tariffs
(or concurrences) for movement of liquids through existing
facilities. Although FERC does police the filings for such matters
as compliance with the general duties of common carriers, the
question of jurisdiction is normally only aired upon complaint.
While any person, including State or Federal agencies, can avail
themselves of the FERC forum by use of the complaint process, that
process has only been rarely used to review jurisdictional matters
(probably because of the infrequency of real disputes on the
issue). Where the issue has arisen, the reviewing body has noted
the need to examine various criteria primarily of an economic
nature. DOT believes that, in most cases, the formal FERC forum can
better receive and evaluate the type of information that is needed
to make decisions of this nature than can DOT.
In delineating which liquid pipeline facilities are interstate
pipeline facilities within the meaning of the HLPSA, DOT will
generally rely on the FERC filings; that is, if there is a tariff
or concurrence filed with FERC governing the transportation of
hazardous liquids over a pipeline facility or if there has been an
exemption from the obligation to file tariffs obtained from FERC,
then DOT will, as a general rule, consider the facility to be an
interstate pipeline facility within the meaning of the HLPSA. The
types of situations in which DOT will ignore the existence or
non-existence of a filing with FERC will be limited to those cases
in which it appears obvious that a complaint filed with FERC would
be successful or in which blind reliance on a FERC filing would
result in a situation clearly not intended by the HLPSA such as a
pipeline facility not being subject to either State or Federal
safety regulation. DOT anticipates that the situations in which
there is any question about the validity of the FERC filings as a
ready reference will be few and that the actual variations from
reliance on those filings will be rare. The following examples
indicate the types of facilities which DOT believes are interstate
pipeline facilities subject to the HLPSA despite the lack of a
filing with FERC and the types of facilities over which DOT will
generally defer to the jurisdiction of a certifying state despite
the existence of a filing with FERC.
Example 1.Pipeline company P operates a pipeline from “Point A”
located in State X to “Point B” (also in X). The physical
facilities never cross a state line and do not connect with any
other pipeline which does cross a state line. Pipeline company P
also operates another pipeline between “Point C” in State X and
“Point D” in an adjoining State Y. Pipeline company P files a
tariff with FERC for transportation from “Point A” to “Point B” as
well as for transportation from “Point C” to “Point D.” DOT will
ignore filing for the line from “Point A” to “Point B” and consider
the line to be intrastate. Example 2.Same as in example 1 except
that P does not file any tariffs with FERC. DOT will assume
jurisdiction of the line between “Point C” and “Point D.” Example
3.Same as in example 1 except that P files its tariff for the line
between “Point C” and “Point D” not only with FERC but also with
State X. DOT will rely on the FERC filing as indication of
interstate commerce. Example 4.Same as in example 1 except that the
pipeline from “Point A” to “Point B” (in State X) connects with a
pipeline operated by another company transports liquid between
“Point B” (in State X) and “Point D” (in State Y). DOT will rely on
the FERC filing as indication of interstate commerce. Example
5.Same as in example 1 except that the line between “Point C” and
“Point D” has a lateral line connected to it. The lateral is
located entirely with State X. DOT will rely on the existence or
non-existence of a FERC filing covering transportation over that
lateral as determinative of interstate commerce. Example 6.Same as
in example 1 except that the certified agency in State X has
brought an enforcement action (under the pipeline safety laws)
against P because of its operation of the line between “Point A”
and “Point B”. P has successfully defended against the action on
jurisdictional grounds. DOT will assume jurisdiction if necessary
to avoid the anomaly of a pipeline subject to neither State or
Federal safety enforcement. DOT's assertion of jurisdiction in such
a case would be based on the gap in the state's enforcement
authority rather than a DOT decision that the pipeline is an
interstate pipeline facility. Example 7.Pipeline Company P operates
a pipeline that originates on the Outer Continental Shelf. P does
not file any tariff for that line with FERC. DOT will consider the
pipeline to be an interstate pipeline facility. Example 8.Pipeline
Company P is constructing a pipeline from “Point C” (in State X) to
“Point D” (in State Y). DOT will consider the pipeline to be an
interstate pipeline facility. Example 9.Pipeline company P is
constructing a pipeline from “Point C” to “Point E” (both in State
X) but intends to file tariffs with FERC in the transportation of
hazardous liquid in interstate commerce. Assuming there is some
connection to an interstate pipeline facility, DOT will consider
this line to be an interstate pipeline facility. Example
10.Pipeline Company P has operated a pipeline subject to FERC
economic regulation. Solely because of some statutory economic
deregulation, that pipeline is no longer regulated by FERC. DOT
will continue to consider that pipeline to be an interstate
pipeline facility.
As seen from the examples, the types of situations in which DOT
will not defer to the FERC regulatory scheme are generally
clear-cut cases. For the remainder of the situations where
variation from the FERC scheme would require DOT to replicate the
forum already provided by FERC and to consider economic factors
better left to that agency, DOT will decline to vary its reliance
on the FERC filings unless, of course, not doing so would result in
situations clearly not intended by the HLPSA.
[Amdt. 195-33, 50 FR 15899, Apr. 23, 1985]