[House Hearing, 109 Congress]
[From the U.S. Government Publishing Office]





                            PIPELINE SAFETY

=======================================================================

                                (109-57)

                                HEARING

                               BEFORE THE

                            SUBCOMMITTEE ON
                    HIGHWAYS, TRANSIT AND PIPELINES

                                 OF THE

                              COMMITTEE ON
                   TRANSPORTATION AND INFRASTRUCTURE
                        HOUSE OF REPRESENTATIVES

                       ONE HUNDRED NINTH CONGRESS

                             SECOND SESSION

                               __________

                             MARCH 16, 2006

                               __________

                       Printed for the use of the
             Committee on Transportation and Infrastructure







                                 _____

                 U.S. GOVERNMENT PRINTING OFFICE

28-272 PDF              WASHINGTON : 2006
_________________________________________________________________
For sale by the Superintendent of Documents, U.S. Government 
Printing  Office Internet: bookstore.gpo.gov  Phone: toll free 
(866) 512-1800; DC area (202) 512-1800 Fax: (202) 512-2250 Mail:
Stop SSOP, Washington, DC 20402-0001





























             COMMITTEE ON TRANSPORTATION AND INFRASTRUCTURE

                      DON YOUNG, Alaska, Chairman

THOMAS E. PETRI, Wisconsin, Vice-    JAMES L. OBERSTAR, Minnesota
Chair                                NICK J. RAHALL, II, West Virginia
SHERWOOD L. BOEHLERT, New York       PETER A. DeFAZIO, Oregon
HOWARD COBLE, North Carolina         JERRY F. COSTELLO, Illinois
JOHN J. DUNCAN, Jr., Tennessee       ELEANOR HOLMES NORTON, District of 
WAYNE T. GILCHREST, Maryland         Columbia
JOHN L. MICA, Florida                JERROLD NADLER, New York
PETER HOEKSTRA, Michigan             CORRINE BROWN, Florida
VERNON J. EHLERS, Michigan           BOB FILNER, California
SPENCER BACHUS, Alabama              EDDIE BERNICE JOHNSON, Texas
STEVEN C. LaTOURETTE, Ohio           GENE TAYLOR, Mississippi
SUE W. KELLY, New York               JUANITA MILLENDER-McDONALD, 
RICHARD H. BAKER, Louisiana          California
ROBERT W. NEY, Ohio                  ELIJAH E. CUMMINGS, Maryland
FRANK A. LoBIONDO, New Jersey        EARL BLUMENAUER, Oregon
JERRY MORAN, Kansas                  ELLEN O. TAUSCHER, California
GARY G. MILLER, California           BILL PASCRELL, Jr., New Jersey
ROBIN HAYES, North Carolina          LEONARD L. BOSWELL, Iowa
ROB SIMMONS, Connecticut             TIM HOLDEN, Pennsylvania
HENRY E. BROWN, Jr., South Carolina  BRIAN BAIRD, Washington
TIMOTHY V. JOHNSON, Illinois         SHELLEY BERKLEY, Nevada
TODD RUSSELL PLATTS, Pennsylvania    JIM MATHESON, Utah
SAM GRAVES, Missouri                 MICHAEL M. HONDA, California
MARK R. KENNEDY, Minnesota           RICK LARSEN, Washington
BILL SHUSTER, Pennsylvania           MICHAEL E. CAPUANO, Massachusetts
JOHN BOOZMAN, Arkansas               ANTHONY D. WEINER, New York
JIM GERLACH, Pennsylvania            JULIA CARSON, Indiana
MARIO DIAZ-BALART, Florida           TIMOTHY H. BISHOP, New York
JON C. PORTER, Nevada                MICHAEL H. MICHAUD, Maine
TOM OSBORNE, Nebraska                LINCOLN DAVIS, Tennessee
KENNY MARCHANT, Texas                BEN CHANDLER, Kentucky
MICHAEL E. SODREL, Indiana           BRIAN HIGGINS, New York
CHARLES W. DENT, Pennsylvania        RUSS CARNAHAN, Missouri
TED POE, Texas                       ALLYSON Y. SCHWARTZ, Pennsylvania
DAVID G. REICHERT, Washington        JOHN T. SALAZAR, Colorado
CONNIE MACK, Florida                 JOHN BARROW, Georgia
JOHN R. `RANDY' KUHL, Jr., New York
LUIS G. FORTUNO, Puerto Rico
LYNN A. WESTMORELAND, Georgia
CHARLES W. BOUSTANY, Jr., Louisiana
JEAN SCHMIDT, Ohio

                                  (ii)



































            SUBCOMMITTEE ON HIGHWAYS, TRANSIT AND PIPELINES

                  THOMAS E. PETRI, Wisconsin, Chairman

SHERWOOD L. BOEHLERT, New York       PETER A. DeFAZIO, Oregon
HOWARD COBLE, North Carolina         NICK J. RAHALL II, West Virginia
JOHN J. DUNCAN, Jr., Tennessee       JERROLD NADLER, New York
JOHN L. MICA, Florida                GENE TAYLOR, Mississippi
PETER HOEKSTRA, Michigan             JUANITA MILLENDER-McDONALD, 
SPENCER BACHUS, Alabama              California
STEVEN C. LaTOURETTE, Ohio           ELIJAH E. CUMMINGS, Maryland
SUE W. KELLY, New York               EARL BLUMENAUER, Oregon
RICHARD H. BAKER, Louisiana          ELLEN O. TAUSCHER, California
ROBERT W. NEY, Ohio                  BILL PASCRELL, JR., New Jersey
FRANK A. LoBIONDO, New Jersey        TIM HOLDEN, Pennsylvania
JERRY MORAN, Kansas                  BRIAN BAIRD, Washington
GARY G. MILLER, California, Vice-    SHELLEY BERKLEY, Nevada
Chair                                JIM MATHESON, Utah
ROBIN HAYES, North Carolina          MICHAEL M. HONDA, California
ROB SIMMONS, Connecticut             RICK LARSEN, Washington
HENRY E. BROWN, Jr., South Carolina  MICHAEL E. CAPUANO, Massachusetts
TIMOTHY V. JOHNSON, Illinois         ANTHONY D. WEINER, New York
TODD RUSSELL PLATTS, Pennsylvania    JULIA CARSON, Indiana
SAM GRAVES, Missouri                 TIMOTHY H. BISHOP, New York
MARK R. KENNEDY, Minnesota           MICHAEL H. MICHAUD, Maine
BILL SHUSTER, Pennsylvania           LINCOLN DAVIS, Tennessee
JOHN BOOZMAN, Arkansas               BEN CHANDLER, Kentucky
MARIO DIAZ-BALART, Florida           BRIAN HIGGINS, New York
JON C. PORTER, Nevada                RUSS CARNAHAN, Missouri
TOM OSBORNE, Nebraska                ALLYSON Y. SCHWARTZ, Pennsylvania
KENNY MARCHANT, Texas                JAMES L. OBERSTAR, Minnesota
MICHAEL E. SODREL, Indiana             (Ex Officio)
DAVID G. REICHERT, Washington
JEAN SCHMIDT, Ohio
DON YOUNG, Alaska
  (Ex Officio)

                                 (iii)

























                                CONTENTS

                               TESTIMONY

                                                                   Page
 Bender, E. Frank, Vice President, Gas Distribution and New 
  Business Division, Baltimore Gas and Electric Company..........    19
 Chipkevich, Bob, National Transportation Safety Board, Director, 
  Office of Railroad, Pipeline and Hazardous Material Safety.....     3
 Epstein, Lois, P.E., Senior Engineer, Cook Inlet Keeper, 
  Anchorage, Alaska..............................................    33
 Mason, Donald L., Commissioner, Public Utilities Commission of 
  Ohio...........................................................    19
 McCown, Brigham, Acting Administrator, Pipeline and Hazardous 
  Materials Administration, U.S. Department of Transportation, 
  accompanied by Stacey Gerard, Acting Assistant Administrator/
  Chief Ssfety Officer, Pipeline and Hazardous Materials Safety 
  Administration and Associate Asministrator for Pipeline Safety.     3
 Mears, Michael N., Vice President, Transportation, Magellan 
  Midstream Partners, L.P........................................    19
 Mohn, Jeryl L., Senior Vice President, Operations and 
  Engineering, Panhandle Energy..................................    19
 Siggerud, Kate, Director, Physical Infrastructure Issues, U.S. 
  Government Accountability Office...............................     3
 Weimer, Carl, Executive Director, Pipeline Safety Trust.........    33
 Zinser, Todd J., Acting Inspector General, U.S. Department of 
  Transportation.................................................     3

          PREPARED STATEMENTS SUBMITTED BY MEMBERS OF CONGRESS

Carnahan, Hon. Russ, of Missouri.................................    56
Cummings, Hon. Elijah, of Maryland...............................    57
DeFazio, Hon. Peter, of Oregon...................................    66
Larsen, Hon. Rick, of Washington.................................    82
Oberstar, Hon. James L., of Minnesota............................   138
Pascrell. Hon. Bill, Jr., of New Jersey..........................   141

               PREPARED STATEMENTS SUBMITTED BY WITNESSES

 Bender, E. Frank................................................    42
 Chipkevich, Bob.................................................    61
 Epstein, Lois...................................................    68
 Mason, Donald L.................................................    83
 McCown, Brigham.................................................    91
 Mears, Michael N................................................   106
 Mohn, Jeryl L...................................................   125
 Siggerud, Kate..................................................   144
 Weimer, Carl....................................................   157
 Zinser, Todd J..................................................   168

                         ADDITION TO THE RECORD

Caperton, Hon. Candice, Director of External Affairs, Danielle 
  Dawn Smalley Foundation, Cradall, Texas, statement.............   182

























 
                            PIPELINE SAFETY

                              ----------                              


                       Thursday, March 16, 2006,

        Committee on Transportation and Infrastructure, 
            Subcommittee Highways, Transit and Pipelines, 
            Washington, D.C.
    The committee met, pursuant to call, at 10:00 a.m. in room 
2167, Rayburn House Office Building, Hon. Tom Petri [chairman 
of the committee] presiding.
    Mr. Petri. The Subcommittee will come to order
    Just by way of orientation, before we get started, we 
expect shortly after we get going a series of votes on the 
House Floor. So we will proceed as far as we can, then we will 
have to adjourn and reassemble, or we will see how we can 
handle that when it occurs. There probably will be 10 votes in 
order, and that could take as long as an hour.
    The purpose of today's hearing is to review the status of 
pipeline safety programs, and in particular the implementation 
of the Pipeline Safety reauthorization passed in the 107th 
Congress. Before looking ahead to a new reauthorization in the 
months ahead, we want to take a look at how the current program 
is working.
    The Pipeline Safety and Security Act of 2002 was signed 
into law in November of that year. The goal of that Act was to 
improve the safety and security of the Nation's 2,200,000 miles 
of pipeline. One of the significant provisions of the Act was 
the requirement that half of all interstate pipelines be 
inspected within five years, with the remainder facing initial 
inspection within a decade, call for inspections within ten 
years of enactment with re-inspections every seven years 
thereafter. Daily civil penalties for companies found to be 
operating below safety standards were increased from $25,000 to 
$100,000, with the maximum penalty for a related series of 
violations raised from $500,000 to $1 million.
    At the time, the Office of Pipeline Safety had not been 
reauthorized for several years. There were significant issues 
that made the reauthorization process contentious and the 
completion of the bill in 2002 required compromises, patience 
and good faith on everyone's part. Four years later, we are 
approaching the end of the authorization period. It is 
important, therefore, that we gain an understanding of how 
things are going in the pipeline safety regime and what 
improvements we have seen in the safe operation of pipelines 
since that law was passed.
    To advance this goal, we have before us representatives 
from various governmental agencies, pipeline operators and 
safety advocates. We look forward to their appraisal of the 
current situation.
    Several days ago, there was a leak in an oil pipeline on 
the North Slops in Alaska. As we understand the situation, it 
resulted from a quarter-inch hole in the pipe from which 
approximately 250,000 gallons of oil leaked over a 10 hour 
period. We understand the leak was contained to a two acre area 
and that no oil has crept into any waterways. Hopefully, we 
understand it is expected by the experts that nearly all the 
oil is expected to be recovered.
    Representatives from the operator, British Petroleum, the 
Pipeline Hazardous Materials Safety Administration, the 
Department of Transportation, as well as State officials, have 
been engaged in the cleanup and appear to have the situation 
under control. It is important to note that this leak was 
quickly discovered and appropriate action taken. Hopefully that 
does not indicate a larger failure in the pipeline safety 
regime.
    Welcome to all of our witnesses here today. We look forward 
to your testimony. Now I would yield to my colleague, Mr. 
Larsen, for any opening statement he would like to make.
    Mr. Larsen. Thank you, Mr. Chairman. I want to thank you 
for holding this hearing today and I want to thank the 
witnesses for being here today to share your expertise.
    Pipeline safety is of great importance to me and the 
constituents that I have in the Washington State Second 
Congressional District. We all know on June 10th of 1999, a 
rupture in a liquid fuel line resulted in an explosion in my 
district, in Bellingham, Washington. The rupture released more 
than a quarter million gallons of gasoline into Whatcom Creek. 
The gasoline ignited, sending a fireball down the creek and 
this fireball claimed the lives of two 10 year old boys and a 
young man of 18.
    This was a tragedy that could have been prevented, should 
have been prevented. I am deeply committed to the families of 
these victims and the citizens of Whatcom County, who have all 
helped lead the fight for increased pipeline regulations and 
safety regulations that will prevent future catastrophes.
    Carl Weimer, from the Pipeline Safety Trust, and now a 
Whatcom County council members, is one of those dedicated 
individuals, and I am happy to have him here today to testify 
on a later panel.
    This Committee did good work in the last reauthorization of 
the Pipeline Safety and Enhancement Act back in 2002. It was a 
very proud moment for me to be able to tell my constituents 
that all together, we increased accountability and strengthened 
the reliability of our Nation's pipeline infrastructure. With 
that 2002 law, we increased penalty fines and improved operator 
qualifications, provided whistleblower protection, improved 
pipeline testing time lines and allowed for some State 
oversight.
    Since then, the law seems to be working well. Oversight and 
safety have gotten better, largely due to the work of PHMSA. 
However, we must remain vigilant. I am interested in hearing 
from our witnesses today on where they see room for 
improvement. As we begin the reauthorization, I hope we can all 
work toward this common goal.
    I strongly encourage the Committee to set an expeditious 
time line as well to ensure that this important bill is 
reauthorized this year.
    Thank you, Mr. Chairman. With that, I conclude my remarks.
    Mr. Petri. Thank you.
    Any other opening statements will be made a part of the 
record when submitted.
    The opening panel consists of Mr. Brigham McCown, Acting 
Administrator, Pipeline and Hazardous Materials Administration, 
United States Department of Transportation; Kate Siggerud, 
Director of Physical Infrastructure Issues, U.S. Government 
Accountability Office; Todd Zinser, Acting Inspector General, 
U.S. Department of Transportation; and Mr. Bob Chipkevich, 
National Transportation Safety Board, Director, Office of 
Railroad, Pipeline and Hazardous Material Safety.
    We welcome you all. We thank you for the effort that you 
and your organizations have made in preparing your opening 
statements, and we look forward to your summary remarks of 
approximately five minutes each, beginning with Mr. McCown.

TESTIMONY OF BRIGHAM MCCOWN, ACTING ADMINISTRATOR, PIPELINE AND 
HAZARDOUS MATERIALS ADMINISTRATION, UNITED STATES DEPARTMENT OF 
TRANSPORTATION; ACCOMPANIED BY: STACEY GERARD, ACTING ASSISTANT 
  ADMINISTRATOR/CHIEF SAFETY OFFICER, PIPELINE AND HAZARDOUS 
MATERIALS SAFETY ADMINISTRATION AND ASSOCIATE ADMINISTRATOR FOR 
      PIPELINE SAFETY; KATE SIGGERUD, DIRECTOR, PHYSICAL 
INFRASTRUCTURE ISSUES, UNITED STATES GOVERNMENT ACCOUNTABILITY 
OFFICE; TODD J. ZINSER, ACTING INSPECTOR GENERAL, UNITED STATES 
    DEPARTMENT OF TRANSPORTATION; BOB CHIPKEVICH, NATIONAL 
  TRANSPORTATION SAFETY BOARD, DIRECTOR, OFFICE OF RAILROAD, 
             PIPELINE AND HAZARDOUS MATERIAL SAFETY

    Mr. McCown. Mr. Chairman and distinguished members of the 
Subcommittee, thank you for the opportunity to appear before 
you today to discuss the Department's ongoing efforts to 
improve the safety of America's pipeline transportation system. 
I appreciate your time in taking up this very important matter.
    Under Secretary Mineta's leadership we have made every 
effort to address every single aspect of Congressional 
provisions mandated by the 2002 Pipeline Safety Improvement 
Act. We hope we are meeting your expectations.
    Through our hard work, we have eliminated most of the 12 
year old backlog of outstanding mandates and recommendations of 
Congress, the GAO, our Inspector General and the NTSB. I am 
pleased to report to you that yesterday we published a final 
rule to define and regulate natural gas-gathering lines, 
finishing an 18 year old mandate.
    Safety at the Department and in the Administration remains 
our single highest priority. It is also perhaps our greatest 
challenge. For advancing pipeline safety in the growing 
construction, urban expansion and development and increased 
underground utility congestion within our communities is a 
distinct challenge that we have to address. So working with the 
Common Ground Alliance, we have led many stakeholders to share 
responsibility on this biggest issue, which is damage 
prevention. I would like to thank the CGA and its volunteer 
members and partners and leadership in helping us fight this 
war.
    Planning to implement our newest, most important tool is 
the three-digit dialing for the one-call system. Eight-one-one 
will provide one action for all Americans across the Country to 
call to find out where underground utilities are and to avoid 
third party excavation damage. It is a big task and we need 
help to succeed. Stronger oversight has been important in our 
strategy to combat these threats and strengthen pipeline 
safety.
    In the past 12 years, we have increased pipeline safety 
staff from 28 inspectors to 88 today. While the growth of our 
staff has helped us make tremendous progress, our success in 
this area depends heavily on our ability to solicit assistance 
from our State partners who provide an additional 400 
inspectors. Working with others, we are raising the quality of 
public education that operators provide as well as what we 
provide. We have called for new consensus standards for public 
education. The stakeholders have responded by creating one that 
significantly raises the bar.
    We are improving our efforts to reach the public by 
preparing local officials to be education resources within our 
communities. We also understand the introduction of new 
pipeline technologies can dramatically increase the safety of 
pipeline operations. Over the past three years, our R&D program 
has jump started more than 70 projects across the Country and 
has already generated 8 new patent applications.
    Along with technology, I should mention our enforcement 
actions. We are imposing and we are collecting larger 
penalties, while at the same time guiding pipeline operators to 
deliver higher performance. Compared to 2002 in 2004, we 
doubled our penalties, and in 2005 we have tripled to over $4 
million of what we have imposed. Lastly, we are achieving 
results. And when compared to the previous four years, 
hazardous liquid pipeline incidents are down by 18 percent. 
Over the past 10 years, pipeline excavation related incidents 
have decreased by 59 percent. Accidents of the most severe 
consequences, or those involving death, injuries, fire, 
explosion, evacuation, are also trending steadily downward.
    We recognize, however, there is more room for improvement. 
And we know there is more work to be done. I would like to 
reassure the members of the Subcommittee that the hard working 
men and women of PHMSA are committed to improving safety, 
reliability and public confidence in our Nation's pipeline 
infrastructure. We look forward to continuing our work with 
each of you, the States and our stakeholders in achieving zero 
deaths, zero injuries and zero incidents involving pipelines.
    Ms. Gerard and I will be pleased to answer any questions 
the Subcommittee may have. Thank you, sir.
    Mr. Petri. Thank you.
    Ms. Siggerud?
    Ms. Siggerud. Mr. Chairman, and members of the 
Subcommittee, I appreciate the opportunity to participate in 
this hearing on the Pipeline Safety Improvement Act of 2002.
    My testimony today is based on the preliminary results of 
our work about the effects on safety stemming from first, 
PHMSA's integrity management program for natural gas 
transmission pipelines; and second, the requirement that 
pipeline operators reassess their natural gas pipelines for 
corrosion every seven years. We will be reporting in more 
detail on both of these issues this fall.
    In addition, I would also like to briefly touch on how 
PHMSA has acted to strengthen its enforcement program since I 
testified on this topic before this Subcommittee almost two 
years ago. My statement is based on our review of laws, 
regulations and other PHMSA guidance and discussions with a 
broad range of stakeholders. In addition, we contacted 25 
pipeline operators that are most affected by the program, 
including larger and smaller operators. We also surveyed State 
inspectors.
    Early indications are that the integrity management program 
has enhanced public safety by requiring that operators identify 
and address the greatest risks to their pipelines in highly 
populated areas, known as HCAs. We found broad support for the 
program among both operators and stakeholders concerned with 
safety and the environment. Operators said that the benefits of 
the program include better knowledge of their pipeline systems 
and improved communications within their companies.
    Pipeline operators are making good progress in assessing 
their pipelines. Since 2004, operators have assessed 6,700 of 
the 20,000 miles of pipelines in high consequence areas and 
have completed 338 repairs that by definition needed to be made 
immediately. While it is not possible to know how many of these 
repairs would have been identified without integrity 
management, it is clear that assessing pipelines identifies 
problems that would otherwise go undetected.
    To oversee the program, PHMSA has conducted 11 inspections 
of operators and found that operators are doing well in 
conducting assessments and making repairs. However, some of 
them are having difficulty in documenting their management 
processes. Operators we identified also expressed concern and 
confusion about the level of documentation that would be 
sufficient.
    PHMSA took other actions to implement the program, 
including adopting performance measures and developing 
inspection protocols and a series of training courses. 
Furthermore, PHMSA has been working to improve communication 
with States about their role in overseeing the integrity 
management program. I am pleased to report that the early 
reports from our survey show that a majority of States believe 
this communication has been useful.
    As you know, the Act requires that pipelines be reassessed 
every seven years. The regulations require that these 
reassessments focus on corrosion. The regulations also adopted 
a pipeline industry consensus standard that requires 
comprehensive reassessments every 5, 10, 15 or 20 years, 
depending on the stress in the pipes and the types of problems 
identified.
    Most of the operators told us that in the absence of the 7 
year reassessment, the conditions they identified would lead 
them to reassess their pipelines in 10, 15 or 20 years. The 
requirement is generally consistent with the reassessment 
standard for higher stress pipelines, which is five or ten 
years. Our interviews and industry data suggested a majority of 
transmission pipelines fall into this category.
    Most operators told us that the seven year reassessment 
interval is conservative for pipelines that operate under lower 
stress. This is especially true for local distribution 
companies that transport natural gas under lower pressures from 
larger cross-country lines to feed smaller distribution lines. 
Most we spoke with reported finding conditions that would 
necessitate another assessment in 15 to 20 years.
    Operators viewed reassessment as valuable for public 
safety. However, they prefer a risk-based requirement based on 
engineering standards. This approach would be consistent with 
the overall thrust of the integrity management program. Many 
noted that reassessing pipeline segments with few defects every 
seven years takes resources away from riskier segments that 
require attention. They told us that while PHMSA's regulations 
allow for a less comprehensive assessment to meet the seven 
year requirement, it is likely that they will use more 
extensive testing.
    Operators and inspection contractors we contacted told us 
the services and tools needed to conduct reassessments will 
likely be available to most operators, including during the 
overlap period during 2010 through 2012, when some assessments 
and reassessments will be happening at the same time. Another 
issue debated regarding the seven year interval is that natural 
gas supplies could be interrupted and affect energy markets 
during years when a large number of assessments and 
reassessments occur because operators must reduce pressure in 
their pipelines to conduct assessments and make repairs. We are 
still analyzing this issue and will be reporting on it this 
fall.
    Finally, we reported in 2004 that PHMSA did not have a 
clear and comprehensive enforcement strategy. PHMSA 
reconsidered its approach for enforcing pipeline safety 
standards in response to our concern and adopted a strategy 
last year that is focused on using risk-based enforcement, 
increasing knowledge and accountability for results and 
improving its own enforcement activities. Our preliminary view 
is that this is a reasonable framework and is responsive to the 
concerns that we raised.
    Mr. Chairman, that concludes my statement. I will take 
questions at the appropriate time.
    Mr. Petri. Thank you.
    Now we welcome Mr. Zinser, who is making his debut as the 
Acting Inspector General of the Department of Transportation.
    Mr. Zinser. Thank you, Mr. Chairman, Ranking Member, and 
members of the Subcommittee. We appreciate the opportunity to 
testify today on pipeline safety.
    We have seen considerable progress since we first testified 
on this issue over six years ago. That progress is the direct 
result of the attention of this Subcommittee, Secretary Mineta, 
the Pipeline and Hazardous Materials Safety Administration and 
its Office of Pipeline Safety, as well as the States, industry, 
citizen groups and groups such as the Common Ground Alliance.
    PHMSA's Office of Pipeline Safety is making progress in 
clearing out Congressional mandates. Today only one mandate is 
open from 1992. All mandates from 1996 are closed, and OPS has 
completed actions on 18 of the 23 mandates from the 2002 Act.
    But there is still more work to be done. I would like to 
briefly summarize my statement in six points.
    First, our audit work shows that operators are identifying 
integrity threats and making timely repairs. Operators are well 
underway toward completing baseline assessments of pipeline 
systems in or affecting high-consequence areas. Even though 
they have until 2009 to do so, as of December 2004, hazardous 
liquid operators had completed baseline assessments on 
approximately 95 percent of the 72,000 pipeline miles affecting 
high-consequence areas.
    At the end of 2005, natural gas transmission pipeline 
operators had completed around 33 percent of their baseline 
assessments, even though they have until 2012 to do so. Our 
auditors visited seven hazardous liquid pipeline operators and 
found that the operators had repaired all 409 integrity threats 
we examined, with approximately 98 percent of the repairs 
completed within the established IMP timeframe or OPS-approved 
extensions.
    Secondly, however, we also found the pipeline operator 
reports contained errors, and OPS needs to work with the 
operators to correct and improve their reporting. Six of the 
seven hazardous liquid operators we visited had errors in their 
reports caused by such things as the use of preliminary data 
and data outside of the reporting period. This needs to be 
improved. OPS is working on it, but we consider it an important 
watch item, because without accurate reporting, OPS will not 
have effective oversight.
    Third, OPS' integrity management inspection program is 
helping operators comply with IMP requirements. As of December 
2005, OPS and its State partners had conducted one or more 
integrity management inspections for over 86 percent of the 249 
hazardous liquid pipeline operators. We have seen evidence that 
the OPS enforcement program is helping improve pipeline safety. 
At one operator we visited, OPS inspectors found integrity 
threats not repaired due to errors in analyzing pig data. The 
operator has since made the necessary repairs.
    Fourth, we have seen a sea change in the industry toward 
establishing IMPs for natural gas distribution pipelines. 
Natural gas distribution pipelines make up over 85 percent of 
the natural gas pipeline miles. Nearly all are located in high-
consequence areas where a rupture could be disastrous. Over the 
past five years, while actual numbers remain low, injuries and 
fatalities involving gas distribution pipelines have gone up.
    Even though OPS does not currently require IMPs for gas 
distribution pipelines, since 2004 OPS, its State partners, and 
a broad range of stakeholders have come to agree that all 
distribution pipeline operators should implement an IMP. OPS is 
drafting a rule and expects to develop integrity management 
plans during 2008 and begin implementing those plans in 2009.
    Fifth, work is still needed on establishing pipeline 
security roles and responsibilities between OPS and TSA. In 
September 2004, DOT and DHS signed an umbrella MOU to improve 
their cooperation. But in October 2004, when Congress 
established PHMSA, it told DOT and DHS to come up with an annex 
to the MOU specifically for pipeline and hazardous material 
transportation matters. This has not been done. A lack of 
clearly defined roles could lead to duplicating or conflicting 
efforts, and most importantly, the potential for an 
uncoordinated response to a terrorist attack.
    My final point, Mr. Chairman, is that DOT and PHMSA deserve 
recognition for an outstanding job in the wake of Hurricane 
Katrina. One of the lessons learned in this area is that the 
Secretary's emergency authority could be strengthened. Loss of 
electrical power to pumping stations during Katrina forced 
three major operators to cut off sources of fuel to the Eastern 
Seaboard. OPS sent its inspectors to remote pumping stations to 
ensure the operator personnel were technically qualified to 
manually operate the pipeline system, thus avoiding any 
question about whether a waiver for the operators was needed to 
keep the fuel flowing.
    By law, the Secretary may waive a pipeline safety 
regulation but only after public notice and an opportunity for 
a hearing. With an emergency like Katrina, this would not have 
been practical. Congress should consider whether the 
Secretary's authority for responding to a terrorist attack or 
major disaster involving pipeline transportation needs to be 
strengthened.
    Mr. Chairman, this concludes my statement and I will be 
pleased to answer any questions that you or the other members 
may have.
    Mr. Petri. Thank you.
    Mr. Chipkevich?
    Mr. Chipkevich. Good morning, Chairman Petri and members of 
the Subcommittee. Acting Chairman Rosenker has asked me to 
represent the Board today.
    Since I last testified before this Subcommittee in June 
2004, the Pipeline and Hazardous Material Safety Administration 
has continued to make progress to improve pipeline safety. 
After a series of pipeline accidents, the Safety Board had 
recommended that PHMSA assess industry public education 
programs and require pipeline operators to periodically 
evaluate the effectiveness of those programs.
    In December of 2003, the American Petroleum Institute 
published Recommended Practice 1162 that addressed these 
issues. In May of 2005, PHMSA incorporated the recommended 
practices into its pipeline safety requirements. PHMSA has also 
made progress in the area of mandatory pipeline integrity 
assessments. The Safety Board had recommended that PHMSA 
require periodic inspection to pipelines to identify corrosion, 
mechanical damage and other time dependent defects that could 
be detrimental to the safe operation of pipelines. Final rules 
were published by PHMSA and both hazardous liquid and gas 
transmission operators must now conduct integrity assessments.
    The Safety Board had supported PHMSA's rulemaking in this 
area and closed the 1987 recommendations as acceptable action. 
PHMSA must now ensure that the pipeline operators implement 
effective integrity management programs. Quantifying inputs 
into various risk management models can be difficulty and 
subjective. PHMSA has shared its inspection protocols with the 
Safety Board, and when we investigate accidents that involve 
integrity issues, we will examine PHMSA's process for 
evaluating those integrity management programs.
    In 2001, after investigating an accident involving the 
explosion of a new home in South Riding, Virginia, the Safety 
Board again recommended that PHMSA require gas pipeline 
operators to install excess flow valves in all new and renewed 
gas service lines when operating conditions are compatible with 
readily available valves. Only about one half of the operators 
currently install these vales at cost. Excess flow valves 
should be a standalone requirement and not the result of a 
decision based on risk analysis. Risk factors may change over 
time due to community growth or other events, and the cost of 
excavating existing service to install excess flow valves would 
be another factor to then overcome. Excess flow valves are 
inexpensive safety devices that can save lives.
    PHMSA's final rule on operator qualification, training and 
testing standards was issued in 2001, and focused on qualifying 
individuals performing certain tasks. But it did not require 
training or specify maximum intervals for requalifying 
personnel. Last year, PHMSA published a rule that does require 
operators to have training, and it held public meetings to 
explore ways to strengthen the operator role. These 
developments are positive, and the Board encourages PHMSA to 
continue moving forward on this important issue.
    The Safety Board believes that operator qualification 
requirements must include training, testing to determine if the 
training was effective and requalification of personnel on a 
timely basis.
    With respect to damage prevention, the recent efforts of 
PHMSA and the Common Ground Alliance to establish a national 
one-call number, 8-1-1, is especially noteworthy. We hope that 
the States will now move quickly to ensure that this number is 
incorporated into all telephone exchange systems.
    Finally, the Safety Board recently completed a study of a 
series of accidents that involved delayed reaction by pipeline 
controllers. The study found that an effective alarm review 
audit system by operators would increase the likelihood of 
controllers responding appropriately to alarms associated with 
pipeline leaks and recommended that PHMSA require such reviews 
by operators. The Safety Board continues to review activities 
involving pipeline safety. There clearly has been progress made 
in the last five years.
    Thank you, and I would be glad to answer questions when 
appropriate.
    Mr. Petri. Thank you.
    Any questions, Mr. Larsen?
    Mr. Larsen. Thank you, Mr. Chairman, for allowing me to 
start. I will just try to take five minutes so we can move to 
someone else before we have to get to votes, as well.
    First question, for Mr. McCown, we have done a little bit 
of work in looking at your data base and looking at accidents 
reported since 2002 on hazardous liquid pipeline, natural gas 
transmission and natural gas distribution. I don't know if you 
can see it here, but the colors are big and bright, so you can 
see the pattern, in 2002 and 2005. That is hazardous liquid 
pipelines, some variation in accidents.
    Natural gas transmission accidents, 2002 to 2005, this is 
using your threshold of, I think, $50,000 in damage or over, 
increasing. And on the distribution, somewhat the same pattern 
in terms of, from information out of your data base. I would 
just like you to respond to why we see those increases and do 
you agree with those numbers and what do you propose to do 
about that?
    Mr. McCown. We have noted the numbers that you have just 
shown, and I think several things are important to say. First 
of all, we are concerned that incidents in certain categories 
appear to be trending upward. We need to normalize that data 
over a several year period to determine whether or not we have 
a real problem.
    I think this dovetails into my earlier opening statement 
that excavation damage, most notably by third parties, is a 
significant, real concern. I mention that even over the 
integrity management program, because the integrity management 
program I think to some extent has taken care of lot of the 
internal corrosion problems. But now we need to address the 
leading cause of damage, which is now excavation damage. I 
think if you look at the gas, more of the gas data is in 
localities where you have more digging going on. That is why it 
is important for us to continue to support Common Ground 
Alliance and also support the development of local 
organizations that involve planners, excavators and utility 
companies. We are watching this very carefully.
    I will say, though, the other good news is that the rate of 
incidents with serious consequences does continue to trend 
downward. We are very pleased with that. But we agree with you 
that excavation damage, as you are saying, is something we have 
to aggressively address.
    Mr. Larsen. Even tough you haven't normalized the data yet, 
that's four years of data, what you're seeing at least within 
those, within the bar graph, is it a majority or plurality of 
those are a third party damage?
    Mr. McCown. On that, Ms. Gerard, the Associate 
Administrator for Pipeline Safety, and PHMSA's first Acting 
Chief Safety Officer, is with us.
    Ms. Larsen. Ms. Gerard, it is good to see you.
    Mr. McCown. When it comes to gas distribution, that is 
indeed the leading cause of those.
    Mr. Larsen. I think you mentioned PHMSA has now completed 
13 percent of gas transmission integrity management 
inspections. Do you have enough resources, including 
inspectors, to complete these and other required inspections on 
a timely basis?
    Mr. McCown. We believe we do. We have received about a 245 
percent increase in resources over the past five years. I think 
we are in pretty good shape today.
    Mr. Larsen. One of the issues that we are going to hear 
later on from the community folks has to do with access, public 
access, to information. Do you intend to reinstate access to 
the National Pipeline Mapping System? And if not, what is PHMSA 
doing to help communities determine where pipelines are 
located?
    Mr. McCown. We are very aware of the desire to have the 
access to pipeline locations reinstated. We also acknowledge 
that to some extent this information is available in other 
sources. The data base was pulled after 9/11 and designated by 
the Department as sensitive security information. It is, 
however, still available to State and local governments, and we 
have made operator information available on a zip code by zip 
code basis.
    All that to say, we are studying whether or not there are 
opportunities to release further information. Right now, we are 
in the inter-government consultation phase with the Department 
of Homeland Security to determine whether or not we can release 
more data and put it back up. But we are aware that many people 
would like to see that information returned.
    Mr. Larsen. I certainly look forward to hearing from the 
community folks who are here on that very issue as well.
    I am going to hold tight to five minutes right now, and 
thank you, Mr. Chairman, for a chance to ask some questions.
    Mr. Petri. Mr. Hayes.
    Mr. Hayes. Thank you, Mr. Chairman. And thank all of you 
for being here.
    I would like to ask a couple of questions, particularly of 
Mr. McCown and Ms. Siggerud, on the seven year interval for 
pipeline inspection. In looking at the GAO testimony, is the 
seven years somewhat of an arbitrary number at this point, or 
is that scientifically based? Do you think that that number 
could be increased safely? If so or if not, the overlapping 
years, how do we handle that?
    Ms. Siggerud. The regulation and the Act set out two 
different standards. The seven year reassessment standard is 
required to review for corrosion in these pipelines once the 
baseline assessments have been done. The regulations also 
adopted an industry consensus standard, which laid out 
different intervals that are based on a risk-based approach 
that look at the amount of pressure in the pipeline and the 
types of problems identified during the baseline reassessment, 
and then allow a reassessment interval based on that 
information that is specific to the pipe condition. Those 
reassessment intervals generally are from 5 to 10 years for the 
higher stress pipelines and longer, a 15 to 20 year interval, 
for lower stress pipelines.
    We have done a couple of things to look at this issue. We 
have looked at the standard setting approach that was used to 
develop the consensus standard. It was approved by the American 
National Standards Institute and therefore we believe the 
process to put it in place was an appropriate one. Therefore, 
those intervals are appropriate to consider.
    We have also talked to about 25 operators at this point. We 
are finding that most operators are actually, would have 
assessed their pipelines over a longer period than seven years 
in the absence of the seven year interval.
    Mr. Hayes. So am I hearing you say that you are open to 
evaluating that period of time, and if so, would pipeline 
safety, PHMSA and the industry be able to work together to 
develop a protocol to determine what a an appropriate 
inspection interval would be? I am a recovering utility 
contractor, I must confess. This is not foreign to me at all.
    Ms. Siggerud. There is already a consensus standard that 
exists and that is adopted into the regulation. So in terms of 
PHMSA working with the industry and others, I think we can say 
that is already in place and is being used in terms of 
determining reassessment intervals. We will be reporting in 
more detail on this in the fall, but I think at the moment we 
are feeling supportive of and generally open to a more risk-
based standard.
    Mr. Hayes. Mr. McCown, do you care to comment?
    Mr. McCown. Yes, sir. First, what we have tried to do 
really hard at PHMSA is base all of our decisions on risk 
analyses and data. We are reevaluating and frankly, one size 
may not fit all. When you look at the risk factors, depending 
on the pipelines, some of those intervals may be decreased, 
some of them may be increased. We have also seen a lot of 
technology advances over the last four years, and that is 
something that we are looking at right now.
    Mr. Hayes. Any other comments? Make sure I am hearing you 
correctly, we are reevaluating, the decisions will be based on 
the circumstances? And by the way, if you see somebody with 
their hand up, that's probably somebody in politics. But if you 
see somebody doing this, that is probably a utility contractor 
looking for his track hoe.
    So is it safe to say that you are reevaluating based on 
conditions and risks and you are more than willing to, using 
science and good, sound common sense, with safety first, 
evaluate based on the combination of what you find?
    Mr. McCown. Absolutely, yes.
    Mr. Hayes. Thank you very much. Thank you, Mr. Chairman, I 
yield back.
    Mr. Petri. Thank you.
    Mr. Pascrell?
    Mr. Pascrell. Mr. Chairman, I am extremely disappointed 
that despite the direction from this Committee and the White 
House, it is still unclear exactly who is in charge overseeing 
industry's pipeline security plans, over two years. So Mr. 
Zinser, a broader memorandum of understanding between the DOT 
and Homeland Security was a long overdue first step, I think we 
would agree to that.
    But despite the requests of this Committee for a specific 
pipeline security MOU, the roles and responsibilities of the 
OPS and the TSA for pipeline security remain undefined. Why?
    Mr. Zinser. Sir, I do not think I have the definitive 
answer as to why. I would note that even before 9/11, there 
were security protocols in place that the Office of Pipeline 
Safety had responsibility for. They are continuing to carry 
those out.
    I think our concern is that TSA has come onto the scene. 
They do have statutory authority in this area, and they have 
not clarified what their role is versus what OPS' or PHMSA's 
role is. I would have to speculate, sir, but I do not think 
that the issue rests with the Office of Pipeline Safety or 
PHMSA.
    Mr. Pascrell. Do we have TSA coming in here, Mr. Chairman?
    Mr. Petri. We haven't.
    Mr. Pascrell. I think we should. Because I think after 
examination of the facts that there is some kind of ineptness 
here.
    Mr. Petri. We could have Ms. Gerard respond to your 
question, as well.
    Mr. Pascrell. Sure.
    Ms. Gerard. After 9/11, we worked with State agencies, the 
industry and other Government agencies to create consensus 
guidelines tied to threat levels for exactly what critical 
pipeline facilities needed to be prepared to do, and to ramp up 
in time of threat. Those guidelines are in place today. They 
have not been changed. We have, prior to the standing up of TSA 
and DHS, gone out and inspected operators against those 
guidelines. With the standing up of DHS, we have cooperated 
with them at their request, when necessary, to accompany them 
on those types of audits.
    In the most recent years, DHS has taken full responsibility 
for that. They ask for our help in reviewing plans and 
guidelines. We work with them every day to do that. There just 
is no MOU that lays out the relationship. They definitely have 
the lead role. We definitely have a support role, and we are 
there whenever they ask for our help.
    Mr. Pascrell. Don't you think there should be memorandum of 
understanding on such a critical issue? We've come a long way 
in four years. The industry has been very cooperative. Go back 
to where we were four or five years ago, we were down each 
other's throat. We have come a long way. We have fumbled. Now, 
why don't we have a memorandum of understanding? This goes to 
the heart of security.
    Ms. Gerard. I think we will develop that memorandum.
    Mr. Pascrell. When?
    Mr. Gerard. Pipeline safety has not been the top priority 
with TSA. We are working more actively on the hazardous 
materials side and we are using the more complex hazardous 
materials interaction as the guideline for the strategy we will 
take on pipelines.
    Mr. Pascrell. Are you suggesting that TSA, when you say 
this is not the priority of TSA, I know you have a lot of 
things to deal with, there is no question about that. But we 
made this. This Committee made this a priority. It would seem 
to me that there has not been a proper response and we are not 
simply talking about rearranging chairs in a room, we are 
talking about security. There is a tremendous amount of 
pipelines throughout the United States of America. Why isn't 
this a priority?
    Ms. Gerard. I don't mean to say it is not a priority, top, 
the top priority. So we are working on these issues, but there 
are some others that are receiving a little bit more attention 
right now.
    Mr. Pascrell. Like what?
    Ms. Gerard. Hazardous materials, aviation. So----
    Mr. Pascrell. I am on the Homeland Security Committee, and 
I have been from the very beginning. I know you are being 
careful with your words.
    But I think we deserve an answer on the question of, why 
don't we have a memorandum of understanding. You can pass all 
the notes around you need. It is a simple question. I didn't 
stay up all night to ask the question.
    Ms. Gerard. We agree with you, sir, there should be one. 
And we will get one done as soon as we can.
    Mr. Pascrell. It's been over two years. Am I being 
unreasonable?
    Ms. Gerard. No, sir.
    Mr. Pascrell. Oh.
    Mr. McCown, the 2004 law created the Pipeline Hazardous 
Materials Safety Administration. The Committee included 
language, at the request of many of us, strongly urging that 
the DOT and the DHS execute a memorandum of understanding. That 
memorandum of understanding would define the roles, the 
responsibilities, resources, et cetera, of each of the 
agencies. We don't have that memorandum of understanding. Why 
don't you elaborate on why we don't?
    Mr. McCown. Well, like I say, there is an MOU umbrella 
between the Department of Transportation and the Department of 
Homeland Security. The particulars as to why we don't have a 
memorandum or why we do, I frankly am probably not educated 
enough to comment on.
    All I can tell you, sir, is that I spent almost every 
single day on the phone with the Deputy Administrator of TSA, 
my counterpart, and also with DHS' Infrastructure Protection 
Office. During the hurricanes, we worked very closely with both 
and I think it worked very well. There is always room for 
improvement. But we have made great strides from department to 
department and agency to agency in the past nine months.
    Mr. Pascrell. I am pleased that the Administration, the 
PHMSA, in partnership with the industry stakeholders, is 
developing a plan to strengthen safety of natural gas 
distribution pipeline systems, using integrity management 
principles. I would like to know from you, how would you 
characterize the negotiations that are going on right now? I 
understand we need to run, Mr. Chairman. We will come back and 
have a couple of round?
    Mr. Petri. Yes, I am just curious though, in fairness, Mr. 
Osborne has been very patient.
    Mr. Pascrell. I will withdraw.
    Mr. Petri. Did you have a question you wanted to ask at 
this time?
    Mr. Osborne. Thank you, Mr. Chairman. I just had one brief 
question, and that would go to Mr. McCown. Specifically, what 
would you recommend be done on excavation damage?
    Mr. McCown. Well, sir, we are working first to recommend 
what we are doing with the Common Ground Alliance, which is a 
non-profit prevention organization, to promote and develop best 
practices to prevent damage to underground facilities. With the 
Common Ground Alliance, we are now ready to implement our 
latest tool, which is the one-call, the 8-1-1 number. I think 
the most productive work we do is in a partnership role with 
the CGA and to continue to enhance these cooperative 
developments at the local level as well.
    The down side, I guess, of a booming economy in recent 
years is that construction of new underground infrastructure 
and facilities brings risks of hitting or damaging pipelines 
that are already underground. We believe that outside force 
damage is preventable. Whether it is through working with 
municipalities, zoning boards and commissions, that we can 
continue to significantly reduce excavation damage.
    Mr. Osborne. Thank you.
    Mr. Chairman, in the interest of time I will yield back. I 
know we have to get over for votes.
    Mr. Petri. Thank you. There will be opportunities.
    We will recess until 12:00 noon or as close thereafter as 
we finish the series of votes on the House floor. I think in 
fairness, there are some members who may be coming back to ask 
questions of this panel at that time. Then we will proceed with 
the rest of the hearing.
    The Subcommittee will recess until 12:00.
    [Recess.]
    Mr. Petri. The Subcommittee will resume. The panel is here, 
I see.
    I have a question or two myself I thought I would ask. For 
particularly Mr. McCown, if you could shed any light on 
anything that the Department of Transportation needs from the 
Council for Environmental Quality to make the pipeline repair 
permit streamlining program effective or more effective, we 
would appreciate your putting that into the record.
    Mr. McCown. Mr. Chairman, we are working closely with CEQ. 
I would say what PHMSA and the Department really needs is the 
continual commitment that the other Federal agencies have shown 
to work together with us and to help us in prioritizing the 
work. We are in a situation where, through reimbursable 
agreements, we actually pay for several of the other agencies, 
including U.S. Fish and Wildlife, for example, to do a lot of 
that work for us. It is just important that the other agencies, 
in balancing their own workloads, continue to support our needs 
during this process.
    Mr. Petri. Thank you.
    And then a question for Ms. Gerard, would you be willing to 
spend a few minutes discussing the adequacy of your regulations 
for valves and leak detection and discuss any action you are 
taking in that regard?
    Ms. Gerard. Within our integrity management requirements, 
we have within the body of that regulation specified what 
factors an operator must consider in the placement of valves. 
And in the past few years of inspection of that, there has been 
at least nine instances where the Department has taken an 
action to require a company to improve the process where they 
would use valves.
    We have found at least 46 operators that we required them 
to take additional measures to improve the quality of their 
leak detection programs.
    Mr. Petri. Thank you. Are there other questions?
    Mr. DeFazio, welcome.
    Mr. DeFazio. Thank you, Mr. Chairman. I was in Homeland 
Security, where we are doing a markup where the chairman was 
trying to re-privatize aviation security. It worked so well 
before. So we were engaged in a little bit of discussion there.
    I understand a question I have may have been addressed by 
the panel. But at the risk of being repetitive or redundant, 
since I did just come from Homeland Security, my understanding 
is that we are supposed to have sort of a memorandum of 
understanding regarding the coordination and/or steps required 
for pipeline security between the various agencies involved, 
DHS, DOT, pipeline safety folks. I have not yet seen that 
document, and I was wondering if anybody here could address 
that, when it might be forthcoming or whether they just don't 
think it's necessary, we don't need to take any steps or secure 
a plan or assess the situation.
    No volunteers? So should I pick on someone? Let's see, 
well, we have DOT here, Mr. Zinser. Perhaps you could address 
that from your Department's perspective.
    Mr. Zinser. Yes, sir, we actually raise that issue in our 
testimony. We think that it is very important that this annex 
be executed between DHS or TSA and PHMSA now. My response 
earlier was that I do not really have the definitive answer to 
why it has not been done. But I do not think that it is for 
lack of PHMSA and DOT trying to get it done. I think it is 
probably more on the other side.
    Mr. DeFazio. So I should have asked the question when I was 
over in Homeland Security?
    Mr. Zinser. Yes, sir.
    Mr. DeFazio. I see. All right, I think you have pointed the 
appropriate finger. Thank you.
    [Laughter.]
    Mr. DeFazio. That is helpful. I will pursue it with the 
other agency involved here. That would be all I have for 
questions at the moment, Mr. Chairman.
    Mr. Petri. Are there other questions? Mr. Larsen.
    Mr. Larsen. Thank you, Mr. Chairman. I thank Mr. DeFazio 
for allowing me to continue in this seat, I appreciate that. I 
was trying to hold down the fort for you while you were doing 
work over on the other committee.
    Ms. Siggerud, you stated earlier that a risk-based approach 
would be preferable, I think you said preferable, to a seven 
year reassessment interval. This proposal, the information we 
have here is preliminary. The GAO just completed the design of 
the study in February, if I am not mistaken, February 22nd. The 
final report is not due until November 16th. You've been saying 
in the fall, let's put a date on it, November 15th, that is 
2006.
    Operators have not yet gone through one reassessment 
interval. Do you think we should be waiting before we change 
things? Should we go through one reassessment interval before 
we take a look at whether or not to go to risk assessment model 
versus a firm time line? It may be even far too early to tell 
us what the final report might say, I don't know. But we are 
trying to move this bill this year.
    Ms. Siggerud. Right.
    Mr. Larsen. And we have to try to answer these questions.
    Ms. Siggerud. Yes, you are right. We will be issuing our 
report that provides considerable detail on this issue in 
November of this year. We will, of course be available to talk 
with Subcommittee staff about our findings at any time between 
now and then, if that is helpful, during reauthorization 
deliberations. At this point we have talked to about half of 
the operators that we plan to talk with over the course of 
doing our work. They cover about half of the high consequence 
mileage that has been assessed to date. So we have talked to 
operators that have had a pretty significant experience with 
the initial baseline assessments.
    The data that we can bring to bear at this point on the 
interval question is whether the baseline assessments that have 
happened so far are indicating a greater or a lesser 
reassessment interval in terms of, more than seven or less than 
seven years, what this consensus standard would recommend. What 
we are generally finding so far, and it is based on about half 
the work we plan to do, is that the standard has recommended an 
interval that is greater than seven years in most cases with 
the operators that we have spoken with.
    So that is why I said in my earlier statement that we are 
certainly open to the concept of moving in the direction of a 
risk-based interval as we proceed with our work.
    Mr. Larsen. I am not familiar with what is appropriate or 
not appropriate as you continue through your study. But it 
would seem since we are trying to again get this 
reauthorization done, we want to obviously do it right. But if 
it is appropriate for you all to check back with the staff at 
certain times, whether it is every month, every six weeks or 
whatever it is, just so we can kind of get a check on the 
progress to help inform us as we try to get this bill 
reauthorized.
    Ms. Siggerud. I will commit to doing that. Our overall 
report on integrity management programs in general is due in 
September. We will be talking with the Subcommittee staff on 
our results as they progress there as well.
    Mr. Larsen. OK. Mr. McCown, is PHMSA considering regulating 
low-stress pipelines? Does that require any authority?
    Mr. McCown. Yes, sir, actually we are considering that. 
Back in just last year, in 2005, we actually began a rulemaking 
to consider what regulatory changes or what additional 
oversight may be needed for low-stress liquid pipelines that 
could potentially affect environmentally sensitive areas.
    Mr. Larsen. Do you think you are doing this under current 
authority? You don't believe you need any additional authority 
to do that?
    Mr. McCown. That is correct. I think we have the authority 
and we are in rulemaking right now.
    Mr. Larsen. I think, Mr. Chairman, that is enough out of 
me.
    Mr. Petri. Mr. Pascrell, any additional questions of this 
panel?
    Mr. Pascrell. Yes, I do. I had one more question. Ms. 
Siggerud, as part of the IMPs, the pipeline operators are 
required to complete baseline assessments of all pipeline 
segments located in what we call high consequence areas, high 
population areas, within 10 years, I believe, correct?
    Reassessment of these pipeline segments is required every 
seven years. We have talked about that earlier. I understand 
that the GAO is currently developing a report on the necessity 
of a seven year reassessment period. I just wonder, I know you 
touched upon it, tell us what the preliminary findings are.
    Ms. Siggerud. Yes. We are doing a number of things to 
address that question. As I mentioned to Mr. Larsen, we will be 
reporting out on the seven year interval issue in particular in 
November of this year and working with Subcommittee staff in 
the meantime.
    We are doing a couple of things to look at that issue. 
First of all, we are interviewing large and small operators 
that have pipelines in high consequence areas and asking them 
about what they are finding so far in their baseline 
reassessments as well as what their plans are to conduct 
reassessments, how they will do them and what the timing will 
be.
    We have also looked at the standard that was adopted into 
the regulations in terms of the recommendations that it makes 
about reassessment intervals. At this time we have concluded 
that that standard was developed appropriately in agreement 
with American National Standards Institute procedures, which 
governs such standard setting processes.
    Mr. Pascrell. I want to ask a question if I may, Mr. 
Chairman, to the panel. Do you think that TSA should have a 
role in the process of inspections? Who would like to address 
that? Mr. Zinser?
    Mr. Zinser. Yes, sir. This is really an issue that the 
Department has been dealing with since they established TSA.
    Mr. Pascrell. Right.
    Mr. Zinser. I guess our view is that for several different 
reasons, it is hard to justify why we should afford a whole 
separate inspection staff at TSA when an inspection staff 
exists at the Pipeline Office that is qualified and is out in 
the field already and has experience inspecting for compliance 
with security regulations.
    So I guess my short answer is that our view would be that 
TSA does have a role to play in promulgating regulations and 
setting policy and providing guidance. I think the bill that 
set up TSA provides for a collaboration, since the bill 
established an oversight board to deal with interagency issues. 
That would be the proper role for TSA, and let the Pipeline 
Office take care of the inspections.
    Mr. Pascrell. And do you think that would be adequate? And 
do you think that the industry agrees with you?
    Mr. Zinser. My sense is that the industry would agree with 
us. Whether it is adequate or not, I think that we would want 
to take a look at whether we can set up for security the same 
type of risk-based approach for inspections as we are setting 
up for safety.
    Mr. Pascrell. It would seem to me that what has happened 
over the past five or six years, and we have come to agreements 
on all sides of the issue, and it would get it together, it 
wasn't imposed. From what I see, it has been working fairly 
well. I don't know if I want to make this any more bureaucratic 
than it already is. So I would tend to probably agree with your 
answer, unless there are other factors that I don't know about.
    Mr. Zinser. No, sir. I think that you are right.
    Mr. Pascrell. I can be right once in a while. It is 
possible.
    [Laughter.]
    Mr. Pascrell. Mr. McCown, did you have a response to that?
    Mr. McCown. No, sir, I was actually hoping you were going 
to skip over me on this.
    [Laughter.]
    Mr. Pascrell. Not a chance.
    Mr. McCown. I would just like to add that between 90 
Federal inspectors and the 400 or so State inspectors we have, 
we have a force of over 500 really on the ground. I would like 
to say that we did, the Department did develop security 
protocols after 9/11 but before TSA was stood up. Those 
security protocols are still being used today. I certainly 
think that we need to work cooperatively with TSA. I certainly 
think there is a realization by all of us that you can't be 
safe if you are not secure, and that these two concepts are 
interrelated to some extent.
    Mr. Pascrell. Thanks. Thank you, Mr. Chairman.
    Mr. Petri. Thank you.
    Are there other questions? Mr. Boozman? If not, we thank 
the panel very much. Sorry for the interrupt, but that is the 
nature of things here on the Hill.
    We will proceed to the next panel. It consists of Mr. 
Michael Mears, who is Vice President of Transportation, 
Magellan Midstream Partners, who is testifying on behalf of the 
American Association of Oil Pipelines and the American 
Petroleum Institute; Mr. Jeryl Mohn, Senior Vice President, 
Operations and Engineering, Panhandle Energy, appearing on 
behalf of the Interstate Natural Gas Association of America; 
Mr. E. Frank Bender, Vice President, Gas Distribution and New 
Business Division, Baltimore Gas and Electric Company, who is 
speaking on behalf of the American Gas Association and the 
American Public Gas Association; and the fourth is Mr. Donald 
L. Mason, Public Utilities Commission of Ohio, who is the 
Chairman of the NARUC Committee on Gas.
    As you know, we thank you for your prepared statements, and 
we invite you to summarize them in approximately five minutes, 
beginning with Mr. Mears.

TESTIMONY OF MICHAEL N. MEARS, VICE PRESIDENT, TRANSPORTATION, 
 MAGELLAN MIDSTREAM PARTNERS, L.P.; JERYL L. MOHN, SENIOR VICE 
  PRESIDENT, OPERATIONS AND ENGINEERING, PANHANDLE ENERGY; E. 
FRANK BENDER, VICE PRESIDENT, GAS DISTRIBUTION AND NEW BUSINESS 
DIVISION, BALTIMORE GAS AND ELECTRIC COMPANY; DONALD L. MASON, 
       COMMISSIONER, PUBLIC UTILITIES COMMISSION OF OHIO

    Mr. Mears. Thank you, Mr. Chairman and members of the 
Subcommittee.
    I am Vice President Transportation for Magellan Midstream 
Partners. Magellan operates the Nation's longest pipeline in 
the United States for refined products. Our 8,500 petroleum 
products pipeline system crosses 13 States and extends from the 
Gulf Coast throughout the middle portion of the United States.
    I chair the executive committee of the Association of Oil 
Pipelines, and appreciate the opportunity to appear today on 
behalf of the AOPL and the American Petroleum Institute. 
Together, AOPL and API represent the vast majority of U.S. 
liquid pipeline transportation companies.
    Mr. Chairman, I will summarize my written testimony, which 
has been submitted for the record.
    It has been over three years since the enactment of the 
Pipeline Safety Improvement Act of 2002. On behalf of the 
members of AOPL and API, I wish to thank the members of the 
Subcommittee for their leadership in passing that comprehensive 
and very important legislation.
    As the Subcommittee reviews the current state of pipeline 
safety and the progress that has been made since the 2002 bill 
was enacted, there are five points I would like to emphasize. 
First, the 2002 Act is widely recognized as a success. 
Implementation of this Act, coupled with actions by DOT and the 
industry, has produced significant improvements in pipeline 
safety. This improvement is demonstrated by the record. The 
record is reflected on a chart that I will address in a few 
minutes.
    Number two, respect for the pipeline safety program has 
grown as DOT has implemented the law. Three, the oil pipeline 
industry is making the investments that are required to produce 
continued improved safety performance and has embraced the new 
law. Fourth, there is no urgent need for significant changes in 
the oil pipeline safety statutes at this time. What is needed 
is continued vigorous implementation of the 2002 Act, and that 
is happening.
    And last, it is important that Congress act before 
adjournment this year to affirm the direction of the 2002 Act 
by reauthorization the pipeline safety program for at least 
five more years. About 40 percent of the total U.S. energy 
supply comes from petroleum. The transportation sector depends 
on petroleum for 96 percent of its energy.
    Two-thirds of domestic crude oil and refined products 
transportation is provided by pipeline. Pipelines do this 
safely and efficiently. The cost to transport a gallon of 
petroleum by pipeline is very low, typically two to three cents 
a gallon. Oil pipelines are common carriers whose rates are 
controlled by the Federal Energy Regulatory Commission.
    Oil pipeline income is not related to the price of the 
products that are transported. In fact, high oil prices have a 
negative impact on oil pipelines by raising power costs and 
reducing demand for petroleum.
    Oil pipeline operators have bene subject to the PHMSA 
integrity management regulations since March of 2001, before 
enactment of the 2002 Act. Initially, PHMSA estimated 
approximately 22 percent of the pipeline segments in the 
national oil pipeline network would be assessed and provided 
enhanced protection. However, as shown in PHMSA's inspections 
of operator plans, it is estimated that integrity testing will 
cover approximately 82 percent of the Nation's oil pipeline 
infrastructure.
    Our members who are large operators, which are greater than 
500 miles of pipeline, completed the required 50 percent of 
their baseline testing of the highest risk segments prior to 
the September 30th, 2004 deadline set by the regulations. PHMSA 
has audited each of these operators under these regulations at 
least two times, an initial quick-hit audit and one subsequent 
full audit.
    Although operating under a different deadline, the same 
actions have been taken by the small operators as well. 
Operators are finding and repairing conditions that need the 
repair, and less serious conditions are found in the course of 
investigating defects. Operators are fixing what they find, 
often going beyond the requirement of the law.
    It appears the first cycle of the program will cost the oil 
pipeline industry approximately $1 billion and the industry is 
committed to full implementation of the program. As a result of 
this program, the oil pipeline spill record has improved 
dramatically in the last five years, as these slides show. The 
data for these exhibits come from a voluntary industry program 
that since 1999 has collected data on oil pipeline performance.
    These figures represent line pipe releases, which are those 
that occur outside the company's facilities. For each cause 
category, the trend is down. The number of total releases has 
dropped 51 percent. Releases due to corrosion have dropped 67 
percent. Releases due to operator error have dropped by 63 
percent. Finally, releases from third-party damage have dropped 
37 percent.
    Even though this represents a notable decrease, releases 
caused by excavation damage tend to be more traumatic, larger 
and more likely to threaten the public and the environment in 
comparison of releases from other causes. We believe this is an 
area where new legislation may be appropriate to strengthen 
underground damage prevention.
    The safety improvement has been dramatic, even though we 
have only completed 50 percent of the required baseline 
inspections through 2004. We would expect this trend to 
continue as we complete the first full cycle and begin the 
reassessment intervals. This provides a clear indication that 
the program is working.
    In closing, I will make three points, or re-emphasize three 
points. We do believe what is in place is working. We do 
believe that it does not need any significant changes. And we 
would like Congress to reaffirm the direction and reauthorize 
the program for five years.
    That concludes my remarks. Thank you.
    Mr. Petri. Thank you. Right on the button, just about.
    Mr. Mohn.
    Mr. Mohn. Thank you, Mr. Chairman. I am testifying, as you 
have observed, on behalf of the Interstate Natural Gas 
Association of America, or INGAA. Through this trade 
organization, we represent virtually all of the gas pipelines 
in North America. My particular company operates five major 
interstate gas companies across the United States.
    My testimony today will highlight some of the successes in 
pipeline safety and suggest further improvements for your 
consideration. When Congress passed the Pipeline Safety 
Improvement Act in 2002, you set in motion one of the most 
significant regulatory improvement processes since the original 
Pipeline Safety Act in 1968, namely integrity management 
programs. In short, as you have heard repeatedly today, the Act 
mandated assessment and remediation of defects for pipelines in 
high consequence areas.
    We have ten years to complete a baseline assessment that 
will be complete by 2012 and we have a seven year assessment 
interval that begins in 2010. We have made considerable process 
in implementing integrity management. Through 2005, as you have 
heard, we have completed about 30 percent of our HCAs. We are 
on track to complete all of the required HCAs within ten years, 
including those highest priority HCAs, the highest 50 percent, 
within five years. We are taking defects out of our pipeline 
systems that will prevent future incidents.
    Even though HCAs represent only about 7 percent of the 
mileage of gas transmission pipelines, we will actually inspect 
between 55 and 60 percent of our systems, due primarily to the 
physical layout of our facilities to accommodate smart pigs.
    Lastly, PHMSA has started their audits in gas transmission 
pipelines last year, continuing this year, and we believe that 
their audits will validate the results I have just mentioned.
    Now let me focus briefly on the matter before you, the 
reauthorization of the Act. As the gentleman to my right 
observed, we believe the law is working and only minor changes 
are needed. But yet, some significant items are on the table 
for your consideration. INGAA does believe that all of our 
interests are best served by a reauthorization 2006 for a five 
year period.
    Our INGAA companies have three primary issues that are 
described further in my written testimony. First, you have 
heard a lot about already the reassessment interval. That was 
mandated in the 2002 Act, adopted as a compromise as the 
Committee and Congress eventually moved forward with the 
passage of the integrity management requirement.
    This means that in years eight, nine and ten of the 
baseline period, we will be reassessing pipeline that we had 
already assessed in the baseline period. Very simply stated, 
instead of assessing 10 percent on average of our pipeline in 
those three years, we will be assessing 20 percent. And 
rightfully Congress asked GAO, and you have heard the report 
from GAO this morning, regarding the effectiveness of that 
interval.
    INGAA believes this: number one, that the assessment 
interval should be based on science, technology and experience. 
Number two, that the seven year mandatory period is not the 
best allocation of resources. Number three, in fact, an ASME 
study that was conducted looking at the technical and 
scientific aspects of this a few years ago concluded that 10 
years was a good target. However, in many cases, as you have 
heard earlier today, the pipelines could go 12 to 15 years. 
Likewise, we may have some pipelines that we need to inspect 
more frequently than seven years.
    Fourthly, the requirements to assess that 20 percent in 
three consecutive years and every ten year period, will strain 
the resources, although those people selling pigging services 
and assessment services will tell you otherwise, we expect 
there will be a strain on those resources and our ability to 
reduce the operation of pipelines or take pipelines out of 
service in order to service those needs.
    Secondly, let me move to our other point, damage 
prevention. We have been on a continuous path to prevent this 
leading cause of incidents, namely third-party damage. I see my 
time is about up. If I can just finish my point on damage 
prevention, Mr. Chairman.
    One-call organizations have matured extensively over the 
years. The Common Ground Alliance was formed in 2000 and is 
working well. Now is it time to go to the next level, by 
challenging and endorsing States that meet the damage 
prevention expectations that produce zero incidents.
    We urge you to consider taking a major step to crush these 
types of incidents. One option is to empower PHMSA to incent 
States to create programs modeled after such successful State 
programs as Virginia and Minnesota in significantly reducing 
the number of third-party incidents.
    Mr. Chairman, I appreciate the time and look forward to 
answering your questions.
    Mr. Petri. Thank you.
    Mr. Bender.
    Mr. Bender. Thank you, Chairman Petri, Ranking Member 
DeFazio, other distinguished members of the Subcommittee.
    I am pleased to appear before you today and would like to 
thank the Committee for convening this hearing on the important 
topic of pipeline safety. My name is Frank Bender, I am Vice 
President of Gas Distribution and New Business at Baltimore Gas 
and Electric Company, a subsidiary of Constellation Energy. BGE 
delivers natural gas to 634,000 customers in Maryland. Our 
company is proud of its heritage as the first gas utility in 
the United States, tracing its history back to 1816. We are 
also proud of the focus that we place on our customer service 
and public safety.
    I am testifying today on behalf of the American Gas 
Association and the American Public Gas Association. Together 
we represent over 850 local natural gas utilities, serving 
almost 60 million customers nationwide. The 2002 
reauthorization of the Pipeline Safety Act resulted in several 
significant mandates and initiatives aimed at enhancing safety. 
The Pipeline and Hazardous Materials Safety Administration and 
the industry have made significant progress on each of those 
initiatives.
    In our opinion, only a few minor adjustments should be 
considered at this point, indeed our companies have identified 
only one major area we believe requires considerable 
improvement, and that is excavation damage prevention. 
Congressional attention to more effective State excavation 
damage programs can and will result in real measurable decrease 
in the number of incidents occurring on natural gas 
distribution pipelines each year. Excavation damage is the 
single cause of a majority of natural gas distribution pipeline 
incidents.
    We believe Congress should provide an incentive for States 
to adopt stronger damage prevention programs. Gas distribution 
utilities bring natural gas service to customers' front doors. 
Understandably, most customers think that all pipelines are 
alike. There are, however, significant differences between 
liquid transmission systems, natural gas transmission systems 
and gas distribution systems that are operated by local gas 
utilities.
    Each type of pipeline system faces different challenges, 
operating conditions and consequences from incidents. 
Distribution pipelines are generally small in diameter, operate 
at pressures ranging upward from under one pound per square 
inch and are constructed of several kinds of materials, 
including a large amount of non-corroding plastic pipe. Federal 
regulations recognize the differences between distribution 
pipes and other types of pipeline and different sets of rules 
have been created for each. At the same time, State regulators 
who have direct oversight over distribution operators are 
frequently inspecting and reviewing our operations.
    Our commitment to safety extends beyond Government 
oversight. Indeed, safety is our top priority, a source of 
pride and a matter of corporate policy for every company. We 
continually refine our safety practices. Natural gas utilities 
spend an estimated $6.4 billion each year in safety related 
activities. Our industry's commitment to safety is borne out 
each year through the Federal Bureau of Transportation 
Statistics' annual figures. Delivery of energy by pipeline is 
consistently the safest mode of energy transportation.
    What are the facts about gas safety incidents? There are 
two kinds of incidents involving natural gas distribution 
systems. One, those caused by factors the pipeline operator can 
to some extent control, such as improper welds, material 
defects, incorrect operation and corrosion or excavation damage 
by a utility contractor; and two, those caused by factors the 
pipeline has little or limited ability to control, such as 
excavation damage by a third party, earth movement, structure 
fires, floods, vandalism and lightning.
    The record shows that between 2001 and 2005, 82 percent of 
all reported incidents were the result of excavation damage by 
a third party or other factors a utility company had little or 
no control over. In many cases, the typical little or no 
control incident involves a local excavator who has decided to 
expedite an excavation project at the calculated risk of 
hitting a natural gas pipeline.
    More needs to be done, and this is one area where Congress 
can make the most dramatic step toward increased safety. You 
have heard several times today that excavation damage 
represents the single greatest threat to distribution system 
safety, reliability and integrity. Although the nationwide 
education program on the three-digit one-call dialing to 
prevent excavation damage is a step in the right direction, 
more is needed.
    Data from the last five years demonstrates that States that 
have stringent enforcement programs experience a substantially 
lower rate of excavation damage to pipeline facilities than 
States that do not have stringent enforcement programs or 
powers. Such programs exist in Virginia and Minnesota, and show 
that nine key elements must be present and functional for the 
damage prevention program to be effective.
    We recommend that Congress modify existing law to insert a 
new section outlining these nine elements providing for 
additional funding. Such funding should be allocated directly 
to each State agency having oversight over pipeline safety.
    You have heard about the progress being made on 
distribution integrity. Last year, PHMSA embarked on an effort 
to develop a regulation governing distribution integrity 
management programs. We have been committed to working with all 
members of the joint Federal, State and industry and public 
stakeholder group that has been working toward the completion 
of distribution integrity management rule by PHMSA. Thus, 
industry and Government stakeholders are working 
collaboratively on their own initiative to improve the safety 
of the Nation's distribution lines. We believe this process is 
moving forward successfully and should continue without further 
legislative imperatives.
    The team to which I just referred also found that federally 
mandated installation of excess flow valves and service lines 
to customers is not appropriate. It did, however, suggest that 
operators be required to perform a risk assessment and outline 
risk criteria for the installation of valves. It is our hope 
that in evaluating the appropriateness of the seven year 
reinspection requirement with respect to transmission 
integrity, that in evaluating that requirement the U.S. 
Government Accountability Office will uncover all the pertinent 
facts and Congress will consider options for allowing a change 
to the interval that would be consistent with GAO findings.
    In summary, we believe that Congressional passage of 
pipeline safety reauthorization this year will result in timely 
and significant distribution safety improvements. Thank you for 
the opportunity to appear today.
    Mr. Petri. Thank you.
    The next and last panelist, Mr. Mason.
    Mr. Mason. Good afternoon, Mr. Chairman, members of the 
Subcommittee.
    I appreciate the opportunity to be here. I am the Chairman 
of the Natural Gas Committee of the National Association of 
Regulatory Utility Commissioners. We have compiled my 
presentation or remarks in conjunction with NAPSR, which is the 
pipeline safety administrator at the State level association. 
Plus, my remarks obviously do reflect in this case also the 
Public Utilities Commission of Ohio.
    I would like to start off, and I will summarize, since I 
have filed our comments, that one of the most important jobs as 
a regulator is to make sure that the terms and conditions of 
service and the charges are reasonable and non-discriminatory 
as we pass on the cost of gas as well as the cost of delivering 
gas to consumers. So one of the things we always try to bear in 
mind is maximizing the value the ratepayers are getting for 
what they are spending. So that is why we take very much a 
risk-based approach to our comments today.
    One of the things we are looking at is grant funding should 
increase to meet resource requirements of the State pipeline 
programs. Again, consumers ultimately pay the PHMSA pipeline 
safety user fees that are passed on by natural gas and 
hazardous liquid pipeline transmission companies. State 
pipeline safety program funding is heavily dependent upon 
PHMSA's proper sharing of these user fees. The State pipeline 
safety programs represent approximately 80 percent of the 
Federal-State inspector workforce. That has been commented on 
in an earlier panel. And of course, we oversee these 
nationwide.
    But without adequate funding, States will not be able to 
conduct required inspections of existing pipeline facilities or 
new pipeline construction projects and encourage compliance 
with minimum safety standards. Last year, instead of having a 
50/50 funding, the States funded well over 60 percent of that, 
so I would just ask each of you to bear that in mind. Because 
again, the States are the first line of defense at a community 
level to promote pipeline safety, underground utility damage 
prevention, public education, and awareness regarding 
pipelines.
    State inspectors are required to have at least nine 
training programs, mandatory training, computer based programs 
prior, within their first three years of service, and then have 
subsequent refresher courses after that. We do to make sure the 
people we have in the field are properly trained. But again, 
that is expensive.
    Number two, we think that Congress should increase the 
current $1 million damage prevention grant to States to 
approximately $2.5 million. That is based on the fact that 
every year the PHMSA has approximately $1 million for that 
program, about $2.4 million worth of requests come into that.
    I would like to hit upon a topic that has been discussed 
earlier, and I think it has been a great achievement in the 
last year or so. In March of 2005, with NARUC's strong support, 
the FCC did designate the 8-1-1 number as the nationally 
abbreviated dialing code for one-call systems, in compliance 
with the Pipeline Safety Act of 2002. This three-digit 8-1-1 
will make it easy, it will be easy to remember by excavators to 
help reduce damages. But I want to pass on to you also, it will 
be easy for citizens to remember when they are doing such 
things as extending their patio or putting new trees in, other 
areas where a lot of times we have cut-ins.
    In Ohio right now we have an extensive docketed process 
going on to actually implement that 8-1-1. I think only 
Tennessee and maybe only one other State actually has it in 
place, perhaps Pennsylvania right now.
    Fourth, though, is NARUC supports 80 percent grant funding 
for the pipeline safety programs that enforce excavation damage 
prevention. I want to go back, I saw the chart earlier that 
talked about how much damage to the system was from third-party 
cut-ins. I can't emphasize strongly enough that we can reduce 
third-party cut-ins through 8-1-1, as through other things, we 
can significantly reduce the damage to property and obviously 
personal injury.
    The integrity management gas distribution report, the 
Excavation and Damage Prevention Task Force found that 
excavation damage by far poses the single greatest threat to 
distribution system integrity. It is thus the most significant 
opportunity for distribution pipeline safety improvements. 
Reducing the threat of excavation damage requires affecting the 
behavior of persons not subject to the jurisdiction of pipeline 
safety. What I am saying is, they are excavators. They might be 
homeowners, they might be people who are doing masonry work. So 
it is not the LDCs, the utilities.
    I am running short on time, so fifthly I want to talk about 
something very important. That is the Federal mandate of excess 
flow valves. We are in favor of the States having guidelines we 
will off of for EFV installation. I have been in the field on 
the installation of EFVs, excess flow valves. We recognize 
there are pressures and times that they work very well. But we 
also recognize this time, there are times and pressure when 
they don't work well. So we would encourage the use of EFVs in 
those cases where the in fact do optimize and do work well, but 
obviously discourage them in those times when in fact they 
might actually create more problems.
    I am ready for questions, along with the other panelists. 
Thank you.
    Mr. Petri. Thank you.
    Chairman Young.
    Chairman Young. Mr. Chairman, I appreciate the testimony 
from the panel, although I have not heard all of it. I have 
read most of it. I would like to make a short statement and ask 
one question, then I will have to go to another meeting.
    Mr. Chairman, several days ago there was a leak in an oil 
pipeline on the North Slope of Alaska, remember, in an oil 
pipeline, not the pipeline. We understand the situation, the 
leak was from a small hole in the pipe likely caused by 
corrosion. This segment of pipe was pigged in 1998. The 
inspection data is now under study.
    It is currently estimated approximately 250,000 gallons of 
oil leaked in the roughly 10 hours that the leak occurred. The 
leak is contained to a two-acre area. No oil has crept into any 
waterways and virtually 100 percent of the oil, because of the 
climate, is expected to be recovered.
    Representatives from the operator, BP, the Federal 
regulatory, PHMSA, as well as State officials, have been 
engaged in the cleanup and appear to have the situation under 
control.
    I want to make sure everyone understands this event is not 
our primary focus here today. We are here to affirm the widely 
held view that the Pipeline Safety Improvements Act of 2002 are 
working and working very well. The event in my home State is 
not indicative of any gap or failure in the law. In fact, the 
matter is that sometimes leaks will occur. The real question 
is, how fast is the response, how well is the event understood 
and corrected and is this occurring fewer and fewer times as 
time goes by.
    Our real concern for leaks is excavation damage. That is 
one area where things are not as good as they should be. Mr. 
Chairman, my question is to Mr. Mason, or anyone else who would 
like to answer it, excavation is the most dangerous thing. You 
made some suggestions about, or will you make some suggestions 
about how to solve this? These are municipalities, private 
contractors, individual homeowners or individuals actually 
digging into the soil without prior approval from somebody. Can 
you tell me how many in fact have occurred in the past year as 
far as excavation damage? Can anyone answer that? Mr. Bender, I 
see you leaning forward. Either you are a sucker or you know 
what you are talking about. Go ahead.
    [Laughter.]
    Mr. Bender. Let's hope it's the latter.
    I would say that in Baltimore Gas Electric Service 
territory, we have been 800 and 1,000 per year. We think we 
have a pretty good program. We are not one of the leading 
States. The model States are Virginia and Minnesota. But on any 
given day, you could have three, on some days none. But over 
the course of a year, 1,000 is a lot. Because they are 
uncontrolled, they are dangerous to the public. You have to 
close streets, you have to evacuate. So it is a great deal.
    Now, what can be done about it, in my written testimony I 
pointed out that the distribution integrity group that was put 
together and facilitated by PHMSA has suggested a model similar 
to the model that is used in the State of Virginia and 
Minnesota, for Federal legislation. We believe that is what is 
needed. There are nine points specified in the testimony. We 
believe that with Federal legislation, the States, in funding 
for the States to implement, that that will tremendously 
improve the damage prevention programs currently in existence 
today.
    Chairman Young. If I am a municipality and I am guilty of 
an excavation disruption of one of your lines, who is 
responsible for liability, you or the person who did the 
damage?
    Mr. Bender. Ultimately, the local distribution company is 
always responsible for reliability.
    Chairman Young. Even if someone else digs the hole and 
tears your line up, you are still responsible?
    Mr. Bender. Absolutely, absolutely.
    Chairman Young. Does the municipality have any 
responsibility?
    Mr. Bender. If the municipality digs in or if the 
municipality's contract digs in, then they have responsibility 
for reimbursement of the costs associated with the repair. But 
we are the first responder to securing the site, stopping the 
leak and repairing it.
    Chairman Young. It seems to me that some of these 
excavation incidents could be slowed down if there was some 
type of penalty involved and where they were held responsible, 
not the carrying company.
    Mr. Bender. In the models the States of Virginia and 
Minnesota have, there is a process where all the stakeholders 
actually sit on a commission or a group, if you will, and they 
review every damage. They ferret out who the guilty party was, 
and not only do they charge damages, but they also assign 
penalties in some cases. So that is the model that we are 
suggesting.
    Chairman Young. Again, I think our Act of 2002 is a good 
act. I think it has been well documented and it has been 
successful. But where you have intruders that really cause you 
problems, I think we ought to be addressing the intruders, not 
necessarily the carrier. I think maybe we can look at that down 
the line.
    Thank you, Mr. Chairman. I appreciate it.
    Mr. Petri. Thank you.
    Mr. Larsen?
    Mr. Larsen. I just have a few questions. But I think maybe 
we ought to adopt the penalty that Alaska has for people. They 
hook them up with Don Young and Don beats the living heck out 
of them.
    [Laughter.]
    Mr. Larsen. Some questions about assessment intervals. I 
think one of the concerns that, well, I know one of the 
concerns that I have heard, I will put it in terms of 
backsliding, there is a concern that if we went to a risk 
assessment versus the time line, that there is a concern that 
we are moving backwards from where we ought to be to ensure the 
integrity of transmission lines. Mr. Mohn, could you help me 
understand what a risk assessment model looks like?
    Mr. Mohn. The industry standard referenced earlier today 
provides a various series of flow charts to follow through in 
making the decision about how one deals with a defect that they 
find in the pipeline. The structure of that standards and those 
flow charts leads you to the decision without applying or being 
able to apply very much the judgment to the means by which you 
remediate an anomaly. Those flow charts and the time frames in 
those are based upon science. For example, for a corrosion 
anomaly, over what period of time will the material continue to 
corrode and the wall thickness of the pipe continue to be 
reduced. They consider what, as you heard earlier, the 
operating stress level is of the pipeline.
    So to suggest that it should be based on standards and 
technology is not throwing it to the wind, if you will. THe 
standards are still very structured and very focused.
    Mr. Larsen. Is this the ASME?
    Mr. Mohn. Yes, it is ASME B318S.
    Mr. Larsen. As I recall, a few years back, there was some 
concern just about adopting by reference any one standard as 
opposed to putting it into law itself. How often is the ASME 
updated and how does your industry then take that updated 
information and move with it?
    Mr. Mohn. Of course, it is a standard not of the industry. 
The ASME is a standards organization and the B318S standard for 
example had participation from the regulatory arena from 
various academia as well as other industry. To the extent that 
standards are changed and we have procedures that either 
because of regulatory requirements that adopt the standard or 
if we have procedures that dictate that we follow the 
procedures, we have a changed management process which I think 
is common to all of our companies to ensure that our 
implementation of those procedures is consistent with whatever 
change in the standard might have occurred.
    If I might, Mr. Larsen, I didn't want to leave you with a 
mis-impression about the seven year standard.
    Mr. Larsen. Right.
    Mr. Mohn. Our concern, more so about the hard wired seven 
year, is that it is hard to find science and technology that 
seven years was based upon. I appreciate, and I think we all 
do, in 2002 the significant step that Congress took to get that 
Act out the door required or at least resulted in that seven 
year standard. What we are suggesting to you now is that at 
least if you apply it, we want you to consider applying a 
standard that is based on the science and technology that is 
out there. Because there is a tremendous amount of experience 
in our industry that the GAO report is trying to tap in that 
regard.
    Mr. Larsen. You mentioned that you believe most companies 
in your industry would have some sort of common way to adopt, 
to get any new standards implemented. The obvious question for 
us, we have to write legislation, is how can we be assured that 
there is a common method or that each company has a way to have 
that information migrate into their operating procedures?
    Mr. Mohn. I am making the assumption that if a standard is 
adopted as the means by which PHMSA will administer the law, 
that we would therefore be subject to the inspection and 
enforcement protocol that is a part of the PHMSA regime.
    Mr. Larsen. Thank you, Mr. Chairman. I will have more 
questions.
    Mr. Petri. Thank you. Mr. DeFazio?
    Mr. DeFazio. Thank you, Mr. Chairman.
    Mr. Chairman, I would like to get back to the problem, 
particularly, of the damage issue. Because I am trying to 
understand, I am wondering whether some of--have we created a 
problem with removing the mapping from the public domain? Are 
local jurisdictions who are permitting people to go out, I 
assume these are mostly permitted activities where the damage 
takes place, having to do with some sort of permitted 
construction, unless it is something else, whether it is some 
kind of routine maintenance, I don't know.
    But if it is permitted construction, are local 
jurisdictions having trouble locating? Is that part of where we 
are going here? Because it says in number eight there, it says, 
use of technology to improve all parts of the process. But yet 
with the new Federal restrictions on the availability of the 
mapping, is that part of the problem? I am just trying to get 
at why this is--Mr. Bender?
    Mr. Bender. Yes, sir. I don't think that is part of the 
problem. Because a big part of the problem is frankly what we 
call no-calls. People will dig without calling, in our case, 
Miss Utility or the agency that has been designated as the 
agency to go out and mark the line.
    The entities that mark the lines have drawings provided by 
the utility. They have equipment. There are advances in 
technology and equipment being made all the time. I think that 
is what we are addressing there. Also the sharing of that 
information amongst the parties as is shared within the 
utility, maybe by electronic means or laptops and things of 
that nature. Really that is what we are referring to there.
    So the problem isn't that there is not pipeline diagrams 
available. The problem is they are not always being, the people 
aren't always being called to come out and mark. People just go 
out and dig. That is one problem.
    The other problem is sometimes even when it is marked, 
because in haste or lack of care, the infrastructure is still 
struck. So I would say that to my knowledge, in my cases, lack 
of diagrams and drawings has not been a significant cause of 
this.
    Mr. DeFazio. In most of these cases would this be pertinent 
to something that would be a locally permitted activity? Or is 
it just more casual kind of excavation that doesn't even 
require permitting of some sort?
    Mr. Bender. I think it is both. I think most of the damage 
that we see is by permitted activity, because that is what most 
of the construction activity is.
    Mr. DeFazio. And don't the local jurisdictions then have 
sort of a check-off, and say, so the local jurisdictions in 
part are failing to kind of push the, and say, did you do a 
locate? I mean, that is not required in the permit or prior to 
getting a permit or anything like that?
    Mr. Bender. Not to my knowledge, at lest not in our 
jurisdiction. I wouldn't call it a failure. I think the 
structure is in place. It is just that there is no enforcement 
capability to make people use it. Those who don't use it 
generally almost act with impunity. There is not sufficient 
enforcement or penalties then to punish them.
    Mr. DeFazio. And the penalties would flow from what level 
for distribution systems? That would be from the State level I 
would assume?
    Mr. Bender. Yes, sir.
    Mr. DeFazio. OK. So it is not really an issue of Federal, 
although I think someone else suggested we might somehow incent 
the States to adopt more rigorous enforcement procedures and 
other requirements.
    Mr. Bender. Yes, sir. The State would need funding. They 
would need the resources. In many cases, they are not the 
enforcing agency. The enforcing agency may be the attorney 
general's office. And the attorney, frankly, in fairness to 
them, the attorney general's office has a lot of higher 
priorities with respect to criminal activity and things of that 
nature.
    So the Federal legislation, I think, is necessary to assist 
the State in terms of funding and direction and mandate to do 
what needs to be done.
    Mr. DeFazio. OK, thank you.
    Does anybody else want to comment on that?
    Mr. Mohn. Mr. DeFazio, as an interstate, as a 
representative of interstate pipelines, this is an area where 
the State programs in States like Virginia, Minnesota and other 
States around the Country that have one-call programs are 
actively, are an active part of our damage prevention as well. 
We pay dues, we provide our maps. We participate in that one-
call and in the follow-up programs to that.
    So even though we are an interstate pipeline, we are 
subject to those, subject to and are active participants in 
those State programs and would love to be a part of State 
programs that fit the model of some of the States that you have 
heard mentioned here today.
    Mr. DeFazio. What do you mean, pay dues? I am curious. So 
the State assesses?
    Mr. Mohn. They are generally not State entities. They are 
enabled by some State legislation, but they are funded by the 
users, by those of us that, if you will, get the tickets, get 
the notification that there is an excavation that is going to 
occur near our facilities.
    Mr. DeFazio. OK. Thank you. Thank you, Mr. Chairman.
    Mr. Mason. Mr. Chairman, do you mind if I add from the 
State perspective?
    Mr. Chairman, Ranking Member, since I am with the Public 
Utility Commission of Ohio, and we ran into the same situation. 
We pulled some maps offline. We have not seen any impact on the 
ability of people to know where they were building 
construction.
    But I wanted to hit a key point. The users pay, now, that 
is always an interesting question, we are running into it right 
now in the 8-1-1. The user, the LDC pays, the phone company 
pays, the cable company pays when they get these tickets. It is 
not the user per se in terms of the ABC Excavation Company.
    One of the things we are concerned with going forward is 
you have lawfully constructed something to the highest specs, 
you put it into the ground, but yet that person, that company 
continues to pay any time someone builds anywhere around it.
    So in Ohio, we are trying to figure out, is there a way of 
assigning some of the cost back to the person who makes the 
call without discouraging them from calling. Because I think 
everybody at PHMSA would agree, you really want them to call. 
We have already identified the third-party cut-ins as the 
number one cause of damage. But yet we still want to make sure 
we share the cost with the appropriate party without 
discouraging them.
    Mr. DeFazio. Potentially interesting balance. So I guess 
that goes to the penalty side, you have to say, OK, well, it is 
going to cost you a little bit here, but boy, if you do 
something wrong, the penalty is going to be such that, you are 
going to want to have made that call. Is that where you are 
headed?
    Mr. Mason. Well, thank you for bringing that up. We 
mentioned in testimony before PHMSA last year that one of the 
things that we are looking at doing perhaps is expediting the 
process, almost like the way a mechanic's lien is more 
expedited than just bringing your normal type of lawsuit in 
court to collect something. So we are looking at alternatives, 
so that the excavator is hit more quickly with the cost, 
because again, it may be more of a Pavlovian reaction there if 
he has to pay right away.
    Mr. DeFazio. OK, thank you. Thank you, Mr. Chairman.
    Mr. Petri. Are there other questions? Mr. Larsen.
    Mr. Larsen. Mr. Mason, we have heard about the nearly 500 
inspectors between the Federal Government and the State 
entities, including Washington State. From your members, are 
you hearing that they have enough resources to meet the demand 
for inspections, the mandates for inspections, the work that 
needs to be done to fulfill their organization's missions?
    Mr. Mason. Mr. Chairman, Ranking Member, thank you for that 
question. I would be very remiss if I ever said the commissions 
were all well funded, we did not need any more.
    Mr. Larsen. I would be very shocked if I heard anything 
different.
    [Laughter.]
    Mr. Mason. And then that would make the entire credibility 
of what I had to say thereafter suspect, I guess.
    But the bottom line is, we are funded the best our States 
can come up with. But the bottom line is, States are typically 
still funding slightly more than the portion, it was supposed 
to be 50/50 funding. We are still funding more than our share 
right now. So we do believe that as you intermingle with your 
colleagues who are on the budgetary committees, that perhaps 
you could encourage them to look at this to become equal 
partners in shouldering the financial burden.
    But again, if more rules come down, again we are looking at 
this seven years. I was part of that GAO survey, and they said, 
would you like to see five or ten? And I was on the phone with 
NAPSR at the same time, and our response was, well, five only 
if science means it needs to be five, ten, again, only if 
science means it needs to be ten.
    So our point is, what our funding level is is based off 
whatever regulations are promoted from the Federal level on 
down. Again, probably something more toward even 15 would be 
good on some things. And again, as indicated earlier, five 
years might be right on some other things.
    Mr. Larsen. In Washington State, we have, ours is the UTC, 
utility transportation commission. I will just use that term. 
The funding model for their work is largely, it is rates and 
fees and so on. Is that, even with the inspection on pipelines, 
is that consistent with your other members who have 
responsibilities for inspection of pipelines as well? Is there 
any State general fund money going into that for any of your 
members?
    Mr. Mason. I would like to have the opportunity to give you 
the most accurate answer, so if you don't mind, NARUC will get 
back to the Committee on that exact question.
    Mr. Larsen. Sure. I just want to be able to understand 
that.
    Mr. Mears, in your testimony, I am not sure of your verbal, 
but in your written testimony you discussed access to mapping 
and that it seems to be your position to try to encourage the 
release of information that is consistent with sensitivity of 
that information. Can you tell us your reasoning behind that, 
what value you see to that, what obstacles you are meeting to 
get that achieved?
    Mr. Mears. I think that the value is just access to more 
public information. We do not, as an industry, we are not 
overly concerned with making that information more available. 
As has been pointed out in other testimony, most of that 
information can be obtained from other sources. We have a 
public education program where we are required to educate 
landowners and residents nearby the pipelines as to where those 
pipelines are and what is carried in those pipelines. In many 
cases, valve sites, tank farms are visually located, all of our 
pipelines have pipeline markers on them, so they are very 
easily identified. So we have little concern over making that 
information more publicly available.
    Mr. Larsen. Thank you.
    Mr. Petri. Thank you. I just have one last area. I wonder 
if you, Mr. Mason, or any of the others, could comment on which 
of the States, if there are some outstanding practices in terms 
of promoting State--obviously Ohio, but even internationally, 
because pipelines operate all over the world, in terms of 
either inspection, or there may be other ways of monitoring 
that end up promoting safety and that we should be looking at 
or encouraging.
    Mr. Mason. Mr. Chairman, Ranking Member, that is a good 
question. I would have to say, it was mentioned earlier, I 
believe Wisconsin and Virginia have pretty good models and 
pretty good programs. But Texas, Tennessee, Ohio, California, 
there are a lot of very good programs out there. New York, I 
might add.
    Mr. Petri. Thank you all very much. We appreciate your 
being with us and your testimony.
    The final panel consists of Mr. Carl Weimer, who is the 
Executive Director of the Pipeline Safety Trust; and Ms. Lois 
Epstein, Senior Engineer, Cook Inlet Keeper.
    Mr. Boozman. [Presiding] Mr. Weimer, you can go ahead and 
begin.

 TESTIMONY OF CARL WEIMER, EXECUTIVE DIRECTOR, PIPELINE SAFETY 
TRUST; LOIS EPSTEIN, P.E., SENIOR ENGINEER, COOK INLET KEEPER, 
                       ANCHORAGE, ALASKA

    Mr. Weimer. Mr. Chairman, members of the Subcommittee, 
thank you for inviting me to speak today on the important 
subject of pipeline safety. My name is Carl Weimer, and I am 
the Executive Director of the Pipeline Safety Trust.
    The Pipeline Safety Trust came into being after the Olympic 
Pipeline tragedy in Bellingham that left three young people 
dead, killed every living thing in a beautiful salmon stream 
and caused millions of dollars of economic disruption. Similar 
events have happened in other places before and since the 
Bellingham tragedy.
    Before I speak of the need of improvements to prevent 
future tragedies, I would like to commend the Office of 
Pipeline Safety for the progress that has been made in the past 
five years under its current leadership. I would also like to 
commend the many progressive thinking pipeline companies who 
are now leading by example by operating their pipelines in ways 
that go beyond the minimum Federal standards.
    We should all celebrate this progress while acknowledging 
that continuous evaluation and improvement can make natural gas 
pipelines considerably safer yet. While progress has been made 
in the past five years, we must also acknowledge that there was 
also more than $846 million of property damage done by 
pipelines during that same period.
    One of the Pipeline Safety Trust's highest priorities is to 
ensure that there is enough accurate information easily 
available to local governments and the public so they can gauge 
for themselves the safety of the pipelines that run through 
their communities and how well those pipelines are being 
regulated.
    Since my time today is short, let me briefly mention 
important areas where improvement is needed. These are spelled 
out in much more detail in our written testimony. We believe 
that maps that allow local government and the public to know 
where pipelines are in relation to housing developments and 
businesses are critical to prevent pipeline damage and increase 
pipeline safety.
    Unfortunately, after the 2001 terrorist attacks, the 
National Pipeline Map System was removed from public access and 
became a password-protected system that approved users have to 
agree note to share with anyone else. This new security removes 
the maps from the public altogether and makes the system mainly 
useless to local governments, since the map information cannot 
be added to local GIS systems or planning maps, because of the 
required non-disclosure.
    The location of pipelines are no secret. In fact, they are 
required to be marked ``at each public road crossing, at each 
railroad crossing and in sufficient number along the remainder 
of each buried line so that its location is accurately known.'' 
If terrorists want to find pipelines, they will.
    For these reasons, we ask that you direct OPS to reinstate 
access to the National Pipeline Mapping System, so local 
governments can plan safely and the public can be aware of the 
pipelines that run through their midst.
    One of the most important functions that OPS provides is 
the ongoing independent inspection of pipelines companies 
operations and enforcement when companies fail to operate 
safely. Unfortunately, none of these inspection findings are 
available to local government or the public to review. And 
enforcement documentation is mostly non-existent and one-sided.
    OPS should be required to create an internet-accessible 
inspection and enforcement docket, like the existing DOT 
rulemaking docket, where the public can review basic company 
inspection information and view enforcement as it progresses. 
One of the clearest measures of whether a pipeline company has 
good control of their pipeline system are the number of times 
that they allow their pipeline to exceed the maximum allowable 
operating pressure.
    Unfortunately, the vast majority of these events are not 
required to be reported to OPS, so neither OPS nor the public 
can use this indicator to determine whether the pipeline 
company is causing unwarranted stress on their pipeline. The 
exemption from reporting these events should be removed.
    The Pipeline Safety Improvement Act of 2002 included a new 
program to enhance the understanding and involvement of local 
communities and State initiatives in the pipeline safety issues 
by making pipeline safety information grants of up to $50,000 
available. Such local involvement is critical as OPS moves 
forward in the areas of pipeline damage prevention and 
encroachment.
    To date, none of these grants have been awarded in large 
part because while Congress authorized this grant program, it 
never appropriated any money to fund it. We ask that you make 
sure that the authorization for this program continues and that 
the money funded is appropriated.
    Finally, we would like to ask Congress to consider a phased 
expansion of what is included within the definition of high 
consequence areas to include things like important historical 
sites, parks and wildlife refuges, and in the case of liquid 
pipelines, swimmable and fishable waters.
    Thank you again for this opportunity to testify today. I 
testified five years ago and it is amazing the sea change in 
the different testimony and how I agree with most everything I 
have heard today, unlike five years ago. So we have made some 
real progress. We hope you will consider the ideas we have 
brought forward today which we believe can take pipeline safety 
up another significant notch by including the public more in 
these decisions.
    If you have any questions, I would be glad to answer them 
when it is appropriate or any time in the future. Thank you.
    Mr. Boozman. Thank you.
    Ms. Epstein.
    Ms. Epstein. Good afternoon. My name is Lois Epstein and I 
am a licensed engineer with Cook Inlet Keeper in Anchorage, 
Alaska. Keeper is a non-profit membership organization 
dedicated to protecting the 47,000 square mile Cook Inlet 
watershed and a member of the Water Keeper Alliance of 130 plus 
organizations headed by Bobby Kennedy, Jr.
    My background includes membership since 1995 on the U.S. 
Department of Transportation's Advisory Committee for Oil 
Pipelines, testifying before Congress two times before now on 
pipeline safety, and analyzing the performance of Cook Inlet's 
1,000 plus miles of pipeline infrastructure and several 
research documents.
    Based on the data shown in my written testimony in Figures 
1 and 2, I am focusing my testimony particularly on reducing 
the impact of pipelines on the environment. I will discuss 
three legislative changes and summarize some of the regulatory 
improvements needed. With respect to legislative changes, I 
will cover, and we have heard a little bit about some of these, 
enforcement, high consequence areas and pipeline safety 
information grants.
    On enforcement, the public and pipeline operators have 
little evidence that the increased penalties contained in the 
pipeline safety law since 2002 are being used and collected by 
PHMSA to send a message to pipeline operators that violations 
are both unacceptable and costly. This reality, along with 
PHMSA's lack of judicial enforcement, its minimal use of 
penalties for ``preventive'' enforcement for things like 
corrosion, and the current inability of qualified States to 
pursue pipeline safety enforcement actions for interstate 
pipelines leads to a problematic enforcement environment.
    Consider the following, and I have more detailed evidence 
in my written testimony. The Bellingham, Washington, accident's 
proposed penalty in 2000 was a $3.02 million, which was 
negotiated down to $250,000 nearly five years later. The 
Carlsbad, New Mexico accident's proposed penalty in 2001 was 
$2.52 million; however, to date, no penalty has been collected.
    In contrast to PHMSA, EPA has issued and collected several 
multi-million dollar penalties from oil pipeline companies for 
their releases, including a $34 million penalty against 
Colonial Pipeline in 2003 and a $4.7 million penalty from Exxon 
Mobil in 2002.
    While pipelines are nowhere near as deadly or injurious as 
mining, a recent statement in the New York Times about the Mine 
Safety Administration is illustrative: ``The number of 
citations means nothing when the citations are small, 
negotiable and most often uncollected.''
    I am optimistic that PHMSA will be able to improve its 
enforcement program. I am just pointing out to the Subcommittee 
that to date, they have not made as much progress as they 
certainly can and should be doing.
    As a result of the ongoing problems with PHMSA enforcement, 
Cook Inlet Keeper recommends that the pipeline safety state be 
amended to one, require PHMSA to provide web-based data on 
Federal and State pipeline inspection and enforcement 
activities; two, require PHMSA to submit an annual report to 
Congress on civil and criminal enforcement, including reasons 
for significant penalty reductions; and three, allow qualified 
State pipeline safety officials to pursue enforcement actions 
against interstate pipeline operators, which they cannot now 
do. They can only pursue enforcement actions on intrastate 
lines
    Those portions of transmission pipelines that could affect 
high consequence areas, or HCAs, are subject to the greatest 
regulatory oversight by PHMSA. Congress needs to direct PHMSA 
to expand the regulatory definition of HCAs to include the 
following: parks and refuges and fishable and swimmable waters. 
That is a regulatory change.
    At the time of HCA rule development, PHMSA took a narrow 
view of HCAs, partly for resource reasons and partly because of 
the need to issue the rule in a timely fashion. Additionally, 
Congress needs to include new language in the statute about 
HCAs to cover culturally and historically significant 
resources. For liquid pipelines, these expansions likely will 
not involve testing many more sections of pipelines than are 
being tested currently.
    Pipeline safety information grants are technical grants 
that Congress authorized in 2002 to help involve the public in 
technical decisions. As time goes on, there are missed 
opportunities for use of these funds, which are detailed in my 
written testimony, some good examples, I believe. So Congress 
needs to remedy that situation as soon as possible and ensure 
the funds are appropriated.
    The three regulatory changes needed are pipeline shutoff 
valve standards, beyond what we have now, leak detection system 
performance standards, and removing the low-stress pipeline 
exemption. On the low-stress pipeline exemption, as many of you 
know and we have heard today, two weeks ago, on March 2nd, 
2006, the largest oil spill to date on the North Slope of 
Alaska was discovered at a caribou crossing, over 200,000 
gallons. It occurred over a multi-day period.
    With due respect to Chairman Young and Subcommittee Chair 
Petri, it occurred at a rate just slightly less than a leak 
detection limit of 40,000 gallons a day, which is 1 percent of 
the throughput. Since it was over 200,000 gallons, it occurred 
over at least a five day period before it was discovered, and 
not over the ten hours which was what we heard twice today.
    This spill came from a BP Oil transmission pipeline. It was 
exempt from PHMSA regulations, because it is a low-stress line. 
It meet certain criteria. It was formerly not exempt, and it 
has some corrosion problems and they lowered the stress. So it 
is a problem and it is exempt now.
    Figure 3 in my testimony shows that low-stress transmission 
pipelines can cause significant damage and costs when there are 
releases. Certainly had this occurred in a different season, we 
would have seen some very serious damage and inability to 
remediate that. So to protect the environment, Congress needs 
to direct PHMSA to remove the low-stress hazardous liquid 
pipeline exemption from the regulations.
    In summary, Congress should pursue the following statutory 
changes during the 2006 reauthorization. One, provide web-based 
data on Federal and State pipeline inspection enforcement 
activities and an annual report to Congress on civil and 
criminal enforcement and allow State regulators to pursue 
enforcement on interstate pipelines.
    Two, expand high consequence areas so they will include 
cultural and historic sites. Three, ensure that Congress 
appropriates money for pipeline safety and information grants.
    Thank you very much for your interest in pipeline safety 
and for inviting me to present here today. Please feel free to 
contact me at any time with your questions.
    Mr. Boozman. Thank you very much.
    Mr. Larsen.
    Mr. Larsen. Thank you, Mr. Chairman.
    Ms. Epstein, the low-stress pipeline exemption, I think we 
hard earlier from Mr. McCown that they are pursuing a 
regulatory change. What are your thoughts on that?
    Ms. Epstein. Today is the first time I had heard that from 
the Pipeline and Hazardous Materials Safety Administration. I 
am glad to hear that. My recommendation would be not just to 
focus on the environmentally sensitive areas, because these are 
transmission lines that are fairly widespread, and to treat 
them fairly similarly to transmission lines elsewhere. There is 
one criteria for highly volatile liquids that PHMSA needs to 
look at to see whether they want to remove the exemption for 
that or not, because they are slightly different than this line 
which had a problem, which was a crude oil transmission 
pipeline.
    Mr. Larsen. Right. Mr. Weimer, we heard some testimony 
earlier on the ten year, seven year, ten year assessment, seven 
year reassessment and the risk assessment. Does the Pipeline 
Safety Trust have a view on any shift in how Congress 
approaches the assessment periods?
    Mr. Weimer. Well, I think from what you heard in some of 
the testimony today, some of that is just kind of still in the 
investigatory stage. GAO is looking at that. We haven't even 
completed the first cycle of the investigation, yet, so our 
general sense is that it is probably too soon to change it 
until we get through that first cycle and the GAO report comes 
out.
    There probably is some flexibility there, because as people 
have stated, that number was kind of pulled out of thin air 
during all the hassle last time around with this whole thing. 
So there may be some changes, and it certainly should be based 
on best science.
    Mr. Larsen. I am shocked to hear anybody say Congress pulls 
anything out of thin air. Just absolutely shocked.
    [Laughter.]
    Mr. Larsen. With regard to the damage prevention plan, and 
ideas that people have talked about, where is the Pipeline 
Safety Trust on that? Have you all talked about the 8-1-1 
program, what role the public might play in that? Do you have 
any thoughts on that, Mr. Weimer?
    Mr. Weimer. Yes. I think the public plays a very important 
role, because the public is out there with the pipelines 
running through their property every day. So the more we can 
enlist the public to be the eyes on behalf of the pipeline 
companies and to know when something is going wrong along those 
pipelines and report it, the better.
    That is one of the reasons we think the maps are so 
important, so people really do have a sense of where the 
pipelines are. Because it is amazing talking to people around 
the Country that they do not know that they have pipelines 
through their neighborhoods and some of the local governments 
do not know that, either. So we see the maps as very important.
    We also think that the program that OPS is moving forward, 
their PIPA program, is a great way to bring all the 
stakeholders that have different damage prevention, different 
reasons to be involved with damage prevention, together to 
bring that, all the stakeholders together to come up with 
solutions. That is one of the reasons that we believe the 
grants to local stakeholders is a very important thing, so all 
those people can really be even partners in that effort.
    Mr. Larsen. Is it fair, would it be fair for you to say 
that the experience in 1999, because obviously there was a lot 
of tragedy and so on, but this whole idea of not knowing there 
was a pipeline running through one's neighborhood, is it fair 
to say that a lot of folks in Bellingham were not aware of the 
existence of, actually two pipelines, the liquid fuel and there 
was a natural gas pipeline?
    Mr. Weimer. That is absolutely the truth. The day that the 
pipeline exploded, I was standing on the edge of Whatcom Creek 
and we looked up at what appeared to be an atomic explosion 
cloud going up over the city. Everybody that we were talking 
with was, what could we possibly have in our city that could 
create such an explosion?
    And the City of Bellingham, who did a good job after the 
explosion, had lost track of the pipeline to the point they 
hadn't even renewed their agreements with the pipeline 
companies. So they are out of sight, out of mine, and that is 
really why we need to educate and encourage the public to be 
part of these solutions.
    Mr. Larsen. Because it was obviously pulled off the 
internet and there is limited access to it now, how would you 
propose the public getting that information about the 
pipelines, the locations of pipelines?
    Mr. Weimer. I think it is fairly easy to put the National 
Pipeline Mapping System back up on the internet. You could 
restrict the scale to something like a 1 to 24,000 scale, so 
people could see that the maps are running through their 
neighborhoods without seeing exactly where it would be, 
something of that nature, if needed. That is what other States, 
like Washington State has done their own mapping system, Texas 
has an internet system already online, have done.
    But for the most part, if a terrorist wants to find a bad 
spot to hit a pipeline, they can do it. I think it is very 
important that our local planning departments have access, so 
when a new housing development is going in in town, they know 
that there is a pipeline there when the person comes in to plat 
that property.
    Mr. Larsen. Yes. Good. Thank you, Mr. Chairman. I will have 
a few others questions.
    Mr. Boozman. If the seven year reassessment interval 
doesn't make sense from an engineering standpoint, wouldn't it 
be logical to address the overlap situation now, rather than 
wait for problems to develop before the next reauthorization?
    Mr. Weimer. Well, I will take a crack at it while she is 
finding her sheet. I think it would make sense when it makes 
sense, when the science says that, when the GAO report comes 
in, if they have talked with all the companies and talked with 
different independent experts about that, and there is some 
sense to be made of it, then it would make sense to do that. I 
think to move forward on that before all that information is in 
would be premature. And since we are not even through the first 
cycle of the baseline testing yet and haven't seen how that is 
all going, it may be a little early at this point.
    Ms. Epstein. I think it is important to remember that the 
GAO is still in the middle of its investigation. The statement 
that they submitted to the Subcommittee today says, the seven 
year reassessment requirement is generally consistent with the 
industry consensus standard of at least five to ten years for 
reassessing pipelines operating under high stress.
    So it is not way far off. I agree that we need to wait 
until all the information is in. But I think it is important to 
remember that we are not at the point yet where it is clearly 
something that needs to be changed.
    Mr. Boozman. Thank you.
    Mr. DeFazio.
    Mr. DeFazio. Thank you, Mr. Chairman. Ms. Epstein, on the 
low-stress, you heard, as I did today for the first time, 
perhaps it is because of recent news accounts that they are 
considering rulemaking on that, but from your experience, since 
we gave them the authority to choose what to regulate and not 
to regulate, they chose not to regulate low-stress, but I don't 
know that agency in particular, but I know rulemaking 
generally. I would assume that we would be looking at a very 
lengthy process. It does not guarantee they would go forward. 
If they are a rulemaking they may well say, people should 
comment whether or not we have to adopt a rule. That would be 
part of their comment period.
    Ms. Epstein. That is right. But I actually have a pretty 
dog-eared copy of the 1992 Pipeline Safety Act. Congress 
recognized this as an issue, and the authority was given to 
Office of Pipeline Safety at the time. It says if you have a 
low-stress pipeline, you can't exempt it just simply because it 
is low-stress. So they put in extra criteria.
    That seems to me enough authority for PHMSA to go ahead and 
change it, particularly given this was the largest North Slope 
spill to date, pretty significant, and something that 
absolutely has to be taken into account when we are talking 
about expanding pipeline networks and that sort of thing.
    So the timing was interesting, because I was invited to 
testify before this spill occurred. And when it happened, it 
seemed like it was worthwhile to bring it up to the 
Subcommittee. Because it is an exemption right now. I would 
also like to see in the future NTSB come in and look at some of 
these exempt pipelines and see whether it warrants additional 
regulation and make some recommendations as well.
    Mr. DeFazio. I don't know if you can answer this or not, 
but just in reading those accounts, I am puzzled as to how they 
could not have noticed the loss of that much product over that 
long a period of time.
    Ms. Epstein. It is a very good question, because it is only 
a three mile line between two BP-owned facilities. So it is, 
for the North Slope, certainly a very heavily monitored area by 
the company. It deserves a longer discussion than we have time 
for today. But the metering, the State does have some 
regulations that apply, including the leak detection 
requirement. The metering that is required at both ends, which 
is in addition to the leak detection system, probably could 
have been improved.
    So given that it was a pipeline with a known corrosion 
problem, to have not paid additional attention and done 
additional pigging, maybe more recently than 1998, I think it 
is a pretty serious concern.
    Mr. DeFazio. Thank you. Thank you, Mr. Chairman.
    Mr. Boozman. Mr. Larsen?
    Mr. Larsen. Mr. Weimer, the Distribution Pipeline Integrity 
Management Program process, could you comment on the process 
itself and how the Pipeline Safety Trust has perceived that, as 
well as, in particular, the excess flow valve issue? The reason 
I ask, your testimony is clear on it, but just verbally if you 
could point out what the view is.
    Mr. Weimer. For a little over the past year, there has been 
a Distribution Pipeline Integrity Management Program going on, 
where the industry regulators, the public has been involved 
fairly aggressively to develop a DMIMP integrity management 
program. I think that has been a wonderful effort and has moved 
along much faster than we ever dreamed it would. The initial 
report has come out, I think, in January, maybe December, which 
I think is already looked at, and it calls for a number of 
important things.
    The one place that we disagree with that report is on the 
use of excess flow valves on the service lines. Both a number 
of the Firefighters Association, NTSB, we commissioned an 
independent study on excess flow valves. It came to the same 
conclusion, that for a $15 valve, they should be installed when 
new housing is going in or when that pipeline is being renewed. 
It is going to be awful hard for people to explain to someone 
in the future who dies because that $15 wasn't put on their 
house when they were moving in how leaving that up to the 
industry to decide whether it should or should not be installed 
was a good decision.
    Mr. Larsen. Maybe that is something we can do some follow-
up on as well.
    Actually, I think that is all I have for questions. Thank 
you.
    Ms. Epstein. Mr. Chair, can I say one thing about 
excavation damage and damage prevention?
    Mr. Boozman. Sure.
    Ms. Epstein. I just wanted to clarify for the audience and 
the Subcommittee that we heard a number of phrases used today 
about how common third-party damage is as a cause of incidents. 
For distribution pipelines, absolutely it is clearly the 
greatest cause of incidents. But for the transmission 
pipelines, there is a big difference between calling it a 
leading cause and the leading cause. It actually is a 
significant but not clearly the leading cause of pipeline 
incidents and accidents.
    Mr. Boozman. Very good.
    Do you have anything else?
    Thank you again for being here and presenting your 
testimony. It is greatly appreciated.
    Without objection, the meeting is adjourned.
    [Whereupon, at 1:42 p.m., the Subcommittee was adjourned.]
    
    [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]



