[Federal Register Volume 71, Number 36 (Thursday, February 23, 2006)]
[Notices]
[Pages 9413-9422]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E6-2503]


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DEPARTMENT OF TRANSPORTATION

Pipeline and Hazardous Materials Safety Administration

[Docket No. PHMSA-03-16456 (PD-30(R))]


Houston, TX Requirements on Storage of Hazardous Materials During 
Transportation

AGENCY: Pipeline and Hazardous Materials Safety Administration (PHMSA), 
DOT.

ACTION: Notice of administrative determination of preemption.

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    Local Laws Affected: Houston Fire Code.
    Applicable Federal Requirements: Federal hazardous material 
transportation law, 49 U.S.C. 5101 et seq., and the Hazardous Materials 
Regulations (HMR), 49 CFR parts 171-180.
    Modes Affected: Air and Highway.
SUMMARY: A. Federal hazardous material transportation law preempts the 
following requirements in the Houston Fire Code as applied by the 
Houston Fire Department to the storage of hazardous materials during 
transportation at George Bush Intercontinental Airport, because (a) the 
designation, description, and classification of hazardous materials in 
the Fire Code is not substantively the same as in the HMR; (b) these 
requirements are not substantively the same as requirements in the HMR 
regarding the use of shipping documents to provide emergency response 
information in the event of an incident during the transportation of 
hazardous material; and (c) these requirements require advance 
notification of the transportation of hazardous materials which creates 
an obstacle to accomplishing and carrying out the purposes and goals of 
Federal hazardous material transportation law and the HMR:
    1. Sections 105.8.h.1 and 8001.3.1, which require a permit to 
store, transport on site, dispense, use or handle hazardous materials 
in excess of certain ``exempt'' amounts listed in Table 105-C of the 
Fire Code.
    2. Sections 105.8.f.3 and 7901.3.1, which require a permit to 
store, handle, transport, dispense, or use flammable or combustible 
liquids in excess of the amounts specified in Sec.  105.8.f.3.
    3. Sections 8001.3.2 and 8001.3.3, which specify the Houston Fire 
Chief may require an applicant for a permit to provide a hazardous 
materials management plan and a hazardous materials inventory statement 
in accordance with the provisions of Appendix II-E of the Fire Code.
    B. Federal hazardous material transportation law preempts the 
separation requirements in sections 7902.1.6 and 8001.11.8 of the 
Houston Fire Code as applied by the Houston Fire Department to the 
storage of hazardous materials during transportation at George Bush 
Intercontinental Airport, because these requirements are not 
substantively the same as the segregation requirements in 49 CFR 
175.78.
    C. There is insufficient information to find Federal hazardous 
material transportation law preempts the secondary containment 
requirements in sections 7901.8 and 8003.1.3.3 in the Houston Fire Code 
as enforced and applied by the Houston Fire Department to the storage 
of hazardous materials during transportation at George Bush 
Intercontinental Airport, including the construction and capacity 
requirements for storage cabinets for secondary containment in sections 
7902.5.9 and 8001.10.6, because the application and comments do not 
show (a) it is impossible to comply with both these requirements and 
the Federal hazardous material transportation law, the regulations 
issued under that law, or a hazardous materials transportation security 
regulation or directive issued by the Secretary of Homeland Security 
(DHS), or (b) these requirements, as enforced and applied, are likely 
to cause diversions or delays in the transportation of hazardous 
materials. If the applicant wishes to provide further information 
regarding the secondary containment requirements in the Houston Fire 
Code, it may submit a new application.

FOR FURTHER INFORMATION CONTACT: Frazer C. Hilder, Office of Chief 
Counsel, Pipeline and Hazardous Materials Safety Administration, U.S. 
Department of Transportation, 400 Seventh Street, SW., Washington, DC 
20590-0001 (Tel. No. 202-366-4400).

SUPPLEMENTARY INFORMATION:

I. Background

A. Local Requirements Considered

    In this determination, PHMSA considers the following requirements 
in the Houston Fire Code (Fire Code) as those requirements are applied 
by the Houston Fire Department (HFD) to the temporary storage of 
hazardous materials at George Bush Intercontinental Airport (IAH) 
during transportation.
     Permits:
    1. Sections 105.8.h.1 and 8001.3.1, which require a permit to 
store, transport on site, dispense, use or handle hazardous materials 
in excess of certain ``exempt'' amounts listed in Table 105-C of the 
Fire Code.
    2. Sections 105.8.f.3 and 7901.3.1, which require a permit to 
store, handle, transport, dispense, or use flammable or combustible 
liquids in excess of the amounts specified in Sec.  105.8.f.3.
    3. Sections 8001.3.2 and 8001.3.3, which specify the HFD chief may 
require an applicant for a permit to provide a hazardous materials 
management plan (HMMP) and a hazardous materials inventory statement 
(HMIS) in accordance with the provisions of Appendix II-E of the Fire 
Code.
     Containment and Separation:
    1. Sections 8003.1.3.3 and 7901.8, which require secondary 
containment in buildings, rooms or areas used for storage of hazardous 
materials and

[[Page 9414]]

flammable or combustible liquids, respectively, in excess of specified 
quantities.
    2. Sections 8001.11.8 and 7902.1.6, which require separation of 
incompatible materials in storage by one of several specific 
alternative measures.
    3. Sections 8001.10.6 and 7902.5.9, which contain provisions on the 
construction and use of storage cabinets for hazardous materials.

B. Application

    Societ[eacute] Air France (Air France) has applied for a 
determination that Federal hazardous material transportation law, 49 
U.S.C. 5101 et seq., preempts these permit and containment 
requirements. In its application, Air France states it transports cargo 
on both passenger-carrying and all-cargo aircraft between Paris, France 
and IAH and, since 1979, it has received a permit from HFD to handle 
and store hazardous materials at its IAH cargo facility. It states the 
hazardous materials stored at IAH ``are in transit * * * under active 
shipping papers (or waybills) and are only present there incidental to 
prior or subsequent air transportation.'' It says activities at IAH 
involving these hazardous materials include ``palletization and other 
procedures related to their carriage by air.''
    According to Air France, beginning in June 2002, HFD has required 
it to submit an HMMP and an HMIS in order to obtain a permit, both of 
which require extensive information. It relates HFD refused to accept 
the HMMP and HMIS submitted by Air France until June 2003, and, during 
the interval, HFD cited the local Air France cargo manager for several 
violations of the Fire Code including the alleged failure to provide a 
proper HMIS for the storage of hazardous materials and the alleged 
failure to post the required local permit for the storage, handling or 
use of flammable liquids. Air France also states it moved into a new 
cargo warehouse at IAH in July 2003, where, as a condition of issuing a 
certificate of occupancy, HFD has required the installation of a 
hazardous materials storage cabinet ``for the storage by Air France of 
certain in transit hazardous materials.'' Air France states it operates 
cargo warehouse facilities at six locations in the United States, and 
Houston is the only location where it is required to obtain a local 
permit or install and use storage cabinets to temporarily store 
hazardous materials.

C. Public Notice

    In a notice published in the Federal Register on November 13, 2003 
(68 FR 64413), the Research and Special Programs Administration 
(PHMSA's predecessor agency) \1\ invited interested persons to submit 
comments on Air France's application. In that notice, we discussed our 
prior consideration of the Fire Code in Preemption Determination (PD) 
No. 14(R), Houston, Texas Fire Code Requirements on the Storage, 
Transportation, and Handling of Hazardous Materials, 63 FR 67506 (Dec. 
7, 1998), decision on petition for reconsideration, 64 FR 33939 (June 
24, 1999). In PD-14(R), we explained ``the HMR clearly apply to 
transportation-related storage,'' including ``storage by a carrier 
between the time a hazardous material is offered for transportation and 
the time it is accepted by the consignee,'' and ``transportation-
related activities'' include the interim storage of hazardous materials 
at a transfer facility. 64 FR at 33952 (internal quotations omitted), 
quoted at 68 FR at 64414-15. We also noted the ``current edition of the 
Fire Code has retained the exception in Sec. 7901.1.1'' that the permit 
and other requirements in that Article do not apply to 
``[t]ransportation of flammable and combustible liquids when in 
accordance with DOT regulations on file with and approved by DOT.'' 68 
FR at 64415.
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    \1\ Effective February 20, 2005, PHMSA was created to further 
the ``highest degree of safety in pipeline transportation and 
hazardous materials transportation,'' and the Secretary of 
Transportation redelegated hazardous materials safety functions from 
the Research and Special Programs Administration (RSPA) to PHMSA's 
Administrator. 49 U.S.C. 108, as amended by the Norman Y. Mineta 
Research and Special Programs Improvement Act (Pub. L. 108-426, 
Sec.  2, 118 Stat. 2423 (Nov. 30, 2004)); and 49 CFR 1.53(b), as 
amended at 70 FR 8301-02 (Feb. 18, 2005). For consistency, the terms 
``PHMSA'' and ``we'' are used in the remainder of this 
determination, regardless of whether an action was taken by RSPA 
before February 20, 2005, or by PHMSA after that date.
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    In the November 13, 2003 notice, we further discussed our October 
30, 2003 final rule in Docket No. RSPA-98-4952 (HM-223), 
``Applicability of the Hazardous Materials Regulations to Loading, 
Unloading, and Storage,'' 68 FR 61906, where we

reaffirmed that ``storage incidental to movement of a hazardous 
material'' is a ``transportation function'' and the HMR apply to the 
``[s]torage of a * * * package containing a hazardous material by 
any person between the time that a carrier takes possession of the 
hazardous material for the purpose of transporting it until the 
package containing the hazardous material is physically delivered to 
the destination indicated on a shipping document, package marking, 
or other medium.''

68 FR at 64415, quoting from 49 CFR 171.1(c)(4), as added at 68 FR at 
61938. In HM-223, we ``also reaffirmed in new Sec.  171.1(f)(1) that 
State and local requirements may apply to a `facility at which pre-
transportation or transportation functions are performed,' but that 
those State and local requirements remain subject to preemption under 
the criteria set forth in 49 U.S.C. 5125.'' Id.\2\
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    \2\ In response to administrative appeals, PHMSA's further final 
rule in HM-223 moved from Sec.  171.1(f)(1) to Sec.  171.1(f)(2) the 
provision that State and local requirements applicable to a 
``facility at which functions regulated under the HMR are 
performed'' remain subject to the preemption criteria in Federal 
hazardous material transportation law and reiterated DOT uses the 
procedures in 49 CFR part 107, subpart C to make preemption 
determinations regarding non-Federal requirements (other than 
highway routing requirements which are considered under 49 CFR part 
397). 70 FR 20018, 20033 (Apr. 15, 2005). The April 15, 2005 final 
rule made no change to the long-standing principle that storage 
during transportation remains fully subject to the requirements in 
the HMR. See Sec. Sec.  171.1(c)(4), 171.8, 70 FR at 20032, 20033. 
Petitions for judicial review of both the October 30, 2003 and April 
15, 2005 final rules are pending in American Chemistry Council v. 
Department of Transportation, Nos. 03-1456 & 05-1191 (DC Cir.), but 
those petitions do not challenge those parts of the HM-223 final 
rules making it explicit the HMR apply to storage of hazardous 
materials during transportation.
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    In response to the November 13, 2003 public notice, comments were 
submitted by the City of Houston (City); Air France; Air Transport 
Association of America, Inc.; American Trucking Associations, Inc.; 
Cargolux Airlines, International, S.A.; Council on Radionuclides and 
Radiopharmaceuticals, Inc. (CORAR); Dangerous Goods Advisory Council 
(DGAC); Federal Express Corporation (FedEx); IAH Air Cargo L.P., doing 
business as Lynxs Houston CargoPort (Lynxs); International Air 
Transport Association (IATA); Nuclear Energy Institute (NEI); and the 
Radiopharmaceutical Shippers and Carriers Conference (RSCC). Air France 
and the City submitted rebuttal comments. In September 2005, Air France 
submitted a copy of HFD's Hazardous Materials Inventory Routing Form 
and the accompanying instructions for completing these forms.

II. Federal Preemption

    As discussed in the November 13, 2003 notice, 49 U.S.C. 5125 
contains express preemption provisions relevant to this proceeding. 68 
FR at 64415-16. As amended by section 1711(b) of the Homeland Security 
Act of 2002 (Pub. L. 107-296, 116 Stat. 2320), 49 U.S.C. 5125(a) 
provides--in the absence of a waiver of preemption by DOT under Sec.  
5125(e) or specific authority in another Federal law--a requirement of 
a State, political subdivision of a State, or Indian tribe is preempted 
if


[[Page 9415]]


    (1) complying with a requirement of the State, political 
subdivision, or tribe and a requirement of this chapter, a 
regulation prescribed under this chapter, or a hazardous materials 
transportation security regulation or directive issued by the 
Secretary of Homeland Security is not possible; or
    (2) the requirement of the State, political subdivision, or 
tribe, as applied or enforced, is an obstacle to accomplishing and 
carrying out this chapter, a regulation prescribed under this 
chapter, or a hazardous materials transportation security regulation 
or directive issued by the Secretary of Homeland Security.

    These two paragraphs set forth the ``dual compliance'' and 
``obstacle'' criteria PHMSA had applied in issuing inconsistency 
rulings (IRs) prior to 1990, under the original preemption provision in 
the Hazardous Materials Transportation Act (HMTA). Public Law 93-633 
section 112(a), 88 Stat. 2161 (1975). The dual compliance and obstacle 
criteria are based on U.S. Supreme Court decisions on preemption. Hines 
v. Davidowitz, 312 U.S. 52 (1941); Florida Lime & Avocado Growers, Inc. 
v. Paul, 373 U.S. 132 (1963); Ray v. Atlantic Richfield, Inc., 435 U.S. 
151 (1978).
    Subsection (b)(1) of 49 U.S.C. 5125 provides a non-Federal 
requirement concerning any of the following subjects is preempted--
unless authorized by another Federal law or DOT grants a waiver of 
preemption--when the non-Federal requirement is not ``substantively the 
same as'' a provision of Federal hazardous material transportation law, 
a regulation prescribed under that law, or a hazardous materials 
security regulation or directive issued by DHS:

    (A) The designation, description, and classification of 
hazardous material.
    (B) The packing, repacking, handling, labeling, marking, and 
placarding of hazardous material.
    (C) The preparation, execution, and use of shipping documents 
related to hazardous material and requirements related to the 
number, contents, and placement of those documents.
    (D) The written notification, recording, and reporting of the 
unintentional release in transportation of hazardous material.
    (E) The designing, manufacturing, fabricating, inspecting, 
marking, maintaining, reconditioning, repairing, or testing a 
package, container, or packaging component that is represented, 
marked, certified, or sold as qualified for use in transporting 
hazardous material.\3\
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    \3\ Subparagraph (E) was editorially revised in Sec. 7122(a) of 
the Hazardous Materials Transportation Safety and Security 
Reauthorization Act of 2005, which is Title VII of the Safe, 
Accountable, Flexible, Efficient Transportation Equity Act: A Legacy 
for Users (SAFETEA-LU), Public Law 109-59, 119. Stat. 1891 (Aug. 10, 
2005).

To be ``substantively the same,'' the non-Federal requirement must 
conform ``in every significant respect to the Federal requirement. 
Editorial and other similar de minimis changes are permitted.'' 49 CFR 
107.202(d).
    The 2002 amendments and 2005 reenactment of the preemption 
provisions in 49 U.S.C. 5125 reaffirmed Congress's long-standing view 
that a single body of uniform Federal regulations promotes safety 
(including security) in the transportation of hazardous materials. More 
than thirty years ago, when it was considering the HMTA, the Senate 
Commerce Committee ``endorse[d] the principle of preemption in order to 
preclude a multiplicity of State and local regulations and the 
potential for varying as well as conflicting regulations in the area of 
hazardous materials transportation.'' S. Rep. No. 1102, 93rd Cong. 2nd 
Sess. 37 (1974). When Congress expanded the preemption provisions in 
1990, it specifically found:

    (3) Many States and localities have enacted laws and regulations 
which vary from Federal laws and regulations pertaining to the 
transportation of hazardous materials, thereby creating the 
potential for unreasonable hazards in other jurisdictions and 
confounding shippers and carriers which attempt to comply with 
multiple and conflicting registration, permitting, routing, 
notification, and other regulatory requirements,
    (4) Because of the potential risks to life, property, and the 
environment posed by unintentional releases of hazardous materials, 
consistency in laws and regulations governing the transportation of 
hazardous materials is necessary and desirable,
    (5) In order to achieve greater uniformity and to promote the 
public health, welfare, and safety at all levels, Federal standards 
for regulating the transportation of hazardous materials in 
intrastate, interstate, and foreign commerce are necessary and 
desirable.

Public Law 101-615 section 2, 104 Stat. 3244. (In 1994, Congress 
revised, codified and enacted the HMTA ``without substantive change,'' 
at 49 U.S.C. Chapter 51. Public Law 103-272, 108 Stat. 745 (July 5, 
1994).) A United States Court of Appeals has found uniformity was the 
``linchpin'' in the design of the Federal laws governing the 
transportation of hazardous materials. Colorado Pub. Util. Comm'n v. 
Harmon, 951 F.2d 1571, 1575 (10th Cir. 1991).
    Under 49 U.S.C. 5125(d)(1), any person (including a State, 
political subdivision of a State, or Indian tribe) directly affected by 
a requirement of a State, political subdivision or tribe may apply to 
the Secretary of Transportation for a determination whether the 
requirement is preempted. The Secretary of Transportation has delegated 
authority to PHMSA to make determinations of preemption, except for 
those concerning highway routing (which have been delegated to the 
Federal Motor Carrier Safety Administration). 49 CFR 1.53(b).
    Section 5125(d)(1) requires notice of an application for a 
preemption determination to be published in the Federal Register. 
Following the receipt and consideration of written comments, PHMSA 
publishes its determination in the Federal Register. See 49 CFR 
107.209(c). A short period of time is allowed for filing of petitions 
for reconsideration. 49 CFR 107.211. A petition for judicial review of 
a final preemption determination must be filed in the United States 
Court of Appeals for the District of Columbia or in the Court of 
Appeals for the United States for the circuit in which the petitioner 
resides or has its principal place of business, within 60 days after 
the determination becomes final. 49 U.S.C. 5127(a).
    Preemption determinations do not address issues of preemption 
arising under the Commerce Clause, the Fifth Amendment or other 
provisions of the Constitution, or statutes other than the Federal 
hazardous material transportation law unless it is necessary to do so 
in order to determine whether a requirement is authorized by another 
Federal law, or whether a fee is ``fair'' within the meaning of 49 
U.S.C. 5125(f)(1). A State, local or Indian tribe requirement is not 
authorized by another Federal law merely because it is not preempted by 
another Federal statute. Colorado Pub. Util. Comm'n v. Harmon, above, 
951 F.2d at 1581 n.10.
    In making preemption determinations under 49 U.S.C. 5125(d), PHMSA 
is guided by the principles and policies set forth in Executive Order 
No. 13132, entitled ``Federalism.'' 64 FR 43255 (Aug. 10, 1999). 
Section 4(a) of that Executive Order authorizes preemption of State 
laws only when a statute contains an express preemption provision, 
there is other clear evidence Congress intended to preempt State law, 
or the exercise of State authority directly conflicts with the exercise 
of Federal authority. Section 5125 contains express preemption 
provisions, which PHMSA has implemented through its regulations.

III. Discussion

A. Application of the HMR to Storage During Transportation

    In its application, Air France states it transports cargo on both 
passenger-carrying and all-cargo aircraft between

[[Page 9416]]

Paris, France and IAH and, since 1979, it has received an annual permit 
from HFD to handle and store hazardous materials in transit at its IAH 
cargo facility. It stresses ``hazardous materials typically spend only 
a very short period of time at the Air France cargo facility,'' and 
``Air France is unable to predict what hazardous materials it may have 
in its facility at any given time since this is a function of the 
hazardous materials that its customers choose to ship.''
    According to the City, IAH and the other two Houston airports 
(Hobby and Ellington) make up the fourth-largest multi-airport system 
in the United States and the sixth-largest such system in the world. 
The City states 602 million pounds of cargo were transported through 
IAH during 2002. It indicates ten scheduled all-cargo airlines serve 
IAH, and most of the 25 scheduled passenger airlines serving Houston 
also carry cargo; for many of them ``the transportation of hazardous 
materials constitutes a very significant portion of their cargo 
business'' which is ``vital to the well-being of the Houston airports 
and the local, Texas and regional economies.'' It states the 
``protection of public safety and the smooth flow of commerce * * * are 
each extremely important to the City,'' and the City has a ``strong 
interest in ensuring that hazardous materials stored at City airports 
or in connection with air transportation through the Houston airports 
are managed appropriately'' because City employees ``bear both the 
responsibility and the risk of responding'' to incidents involving 
hazardous materials in transportation. It refers to a purported 
``tension between Federal and local requirements'' and asserts, 
``[u]nless it is clear that a specific provision is indeed preempted, 
the Houston Fire Department understands that it is required to enforce 
the requirements and regulations imposed by local law.''
    As discussed in the November 13, 2003 public notice, the HMR 
clearly apply to the storage of hazardous materials ``incidental to 
[their] movement.'' 68 FR at 64415; see also 49 U.S.C. 5102(12). In the 
October 30, 2003 final rule in HM-223, we reaffirmed that ``storage 
incidental to movement of a hazardous material'' is a ``transportation 
function,'' and the HMR apply to the ``[s]torage of a * * * package 
containing a hazardous material by any person between the time that a 
carrier takes physical possession of the hazardous material for the 
purposes of transporting it until the package containing the hazardous 
material is delivered to the destination indicated on a shipping 
document, package marking, or other medium * * *'' 49 CFR 171.1(c)(4), 
as added at 68 FR 61938; see also the definition of ``storage 
incidental to movement'' added to Sec.  171.8. Id. at 61940-41.
    We also reaffirmed that State and local requirements may apply to a 
``facility at which pre-transportation or transportation functions are 
performed,'' but those State and local requirements remain subject to 
preemption under the criteria set forth in 49 U.S.C. 5125 (discussed in 
Part II, above). 49 CFR 171.1(f)(1) & (2), as added at 68 FR 61938, and 
revised in the April 15, 2005 final rule, 70 FR at 20032-33. 
Accordingly,

    Unless the Secretary waives preemption, the preemption 
provisions of Federal hazmat law effectively preclude state, local, 
and tribal governments from regulating transportation functions, as 
defined in this final rule, in a manner that differs from the 
Federal requirements if the non-Federal requirement is not 
authorized by another Federal law and the non-Federal requirement 
fails the dual compliance, obstacle, or covered subject test. 
Examples of such transportation functions include: * * * (4) storage 
of a hazardous material between the time that a carrier takes 
possession of the material until it is delivered to its destination 
as indicated on shipping documentation.

68 FR at 61924. We also explained ``the definitions adopted in [the HM-
223] final rule permit other Federal agencies, states, and local 
governments to exercise their legitimate regulatory roles at fixed 
facilities,'' but, as expressed in one comment in the HM-223 rulemaking 
proceeding, ``[u]niformity, clarity, and consistency are essential when 
addressing the * * * storage of hazardous materials in intrastate and 
interstate commerce.'' Id. at 61915. In this regard, PHMSA has not 
broken new ground in HM-223 but simply set forth principles 
``consistent with previous administrative determinations and letters of 
interpretation concerning the applicability of the HMR to hazardous 
materials stored incidental to movement.'' Id. at 61919.
    These prior decisions include IR-28, ``San Jose Restrictions on the 
Storage of Hazardous Materials,'' 55 FR 8884 (March 8, 1990), appeal 
dismissed as moot, 57 FR 41165 (September 9, 1992). In IR-28, PHMSA 
examined provisions in the San Jose Hazardous Materials Storage 
Ordinance as it was being applied to a motor carrier's transfer 
facility where ``local shipments and those arriving at the terminal 
from around the world may move directly to another truck or be 
temporarily stored at the terminal until an appropriate outgoing truck 
is present.'' 55 FR at 8888. As with Air France's operations at IAH, 
``all these shipments are under active shipping papers prepared and 
certified by the shipper and using DOT-specified terminology.'' Id. 
Among the local requirements considered in IR-28 were (1) the need to 
submit an HMMP, including an HMIS, in order to obtain a permit to store 
hazardous materials, and (2) secondary containment and segregation 
requirements.
    Citing several prior rulings and court decisions, we stated ``State 
and local permits for hazardous materials transportation are not per se 
inconsistent [with Federal hazardous material transportation law]; 
their consistency depends upon the nature of their requirements.'' 55 
FR at 8890. We specifically found San Jose's requirement to submit an 
HMMP and HMIS is preempted because it created ``potential delay or 
diversion of hazardous materials'' (Id. at 8891), and local 
requirements for emergency response information which are ``not 
identical to these HMR provisions will cause confusion concerning the 
nature of such requirements, undermine compliance with the HMR 
requirements, constitute obstacles to the implementation of those 
provisions, and thus be inconsistent and preempted.'' Id. at 8892. We 
also found ``strict but subjective secondary containment and 
segregation requirements'' which differ from, or are in addition to, 
those in the HMR ``create confusion * * * and the likelihood of 
noncompliance with'' requirements applicable to motor carriers now 
located at 49 CFR 177.848(d) and ``are obstacles to the execution of an 
HMR provision * * * insofar as they apply to transportation-related 
storage.'' Id. at 8893. We made it clear these requirements are not 
preempted ``when applied to non-transportation-related storage.'' Id.
    In PD-12(R), New York Department of Environmental Conservation 
Requirements on the Transfer and Storage of Hazardous Wastes Incidental 
to Transportation, 60 FR 62527 (Dec. 6, 1995), decision on petition for 
reconsideration, 62 FR 15970 (April 3, 1997), PHMSA cautioned ``it may 
be too broad to read IR-28 as finding that any non-Federal requirement 
for secondary containment at a transfer facility is unnecessary and an 
obstacle to accomplishment and carrying out of the HMR.'' 62 FR at 
15972. We noted ``San Jose applied both a subjective secondary 
containment standard and provisions for separation (or segregation) of 
different classes of hazardous materials'' which differed from those in 
the HMR. Id. Moreover, in IR-28, ``no one disputed the effect of the 
San Jose storage requirements'' which would

[[Page 9417]]

force a transfer of the carrier's hazardous materials operations to a 
different facility and delay deliveries. Id. In PD-12(R), we concluded 
there was not sufficient information to find New York's secondary 
containment requirement is an obstacle to accomplishing and carrying 
out Federal hazardous material transportation law and the HMR, ``[i]n 
the absence of more specific evidence of the effects of this 
requirement on the transportation of hazardous waste, including the 
repackaging and consolidation of wastes.'' 62 FR at 15973.
    Accordingly, in PD-14(R), PHMSA stated the HMR clearly apply to the 
transportation of hazardous materials by a carrier, and ``[c]ertain 
activities that take place on private property, including the `loading, 
unloading, or storage [of hazardous material] incidental to the 
movement' of that material in commerce, fall within the scope of 
`transportation' in commerce, 49 U.S.C. 5102(12), and are subject to 
regulation under the HMR.'' 63 FR at 67510, n.5. Moreover, ``[t]he 
enforceability of non-Federal requirements on `incidental' storage 
depends on the consistency of those requirements with the HMR and, of 
course, the applicability of the requirements themselves in terms of 
exceptions such as Secs. 7901.1.1 and 8000.1.1 of the Uniform Fire 
Code.'' 64 FR at 33952.
    It is not possible to accept the City's broad assertion that 
``local fire codes applicable to facilities in which hazardous 
materials are stored are not preempted.'' Local requirements which 
affect the transportation of hazardous material, contained in fire 
codes or other regulations, remain subject to preemption under the 
criteria in 49 U.S.C. 5125. Nothing in the HM-223 final rules has 
changed the applicability of the HMR to specific functions and 
activities, including the ``storage of hazardous materials during 
transportation.'' 68 FR at 61906.
    Moreover, because storage of hazardous materials incidental to 
their movement in commerce is part of ``transportation,'' the specific 
exception in section 7901.1.1 for ``Transportation of flammable and 
combustible liquids when in accordance with DOT regulations on file and 
approved by DOT,'' should mean the permit and storage requirements at 
issue here apply only to other hazardous materials besides flammable 
and combustible liquids. As stated in the November 13, 2003 public 
notice, ``to the extent that flammable and combustible liquids are 
stored in the course of transportation, they cannot be considered 
subject to any requirements in Article 79 of the Fire Code,'' including 
sections 7901.3.1, 7901.9, 7902.1.6, and 7902.5.9 (and the compatible 
provisions in section 105). 68 FR at 64415. The City has failed to 
discuss this issue and, we assume, adheres to the same inherently 
inconsistent position it took in PD-14(R) that some requirements in 
Article 79 ``are not affected'' by the exception in section 7901.1.1. 
See 63 FR at 67510. As a result, PHMSA finds it necessary to address 
requirements in both Articles 79 and 80.

B. Permit

    In its application, Air France states it has received an annual 
permit from HFD since 1979 to handle and store hazardous materials at 
IAH. The Fire Code requires a permit to (1) store, handle, transport, 
dispense, mix, blend, or use flammable or combustible liquids in excess 
of specified quantities (sections 108.f.3 and 7901.3.1), or (2) store, 
transport on site, dispense, use or handle hazardous materials in 
excess of specified quantities (sections 108.h.1 and 8001.3.1). In 
addition, sections 8001.3.2 and 8001.3.3, respectively, authorize the 
Fire Chief to require an HMMP and HMIS.
    Appendix II-E to the Fire Code contains standard forms for the HMMP 
and the HMIS and sets forth the information to be provided. The HMMP 
must include general business information, a general site plan (whose 
requirements are also set forth in Section 8001.3.2), a building floor 
plan, information on hazardous materials handling, information on 
chemical compatibility and separation, a monitoring program, inspection 
and record keeping, employee training, and emergency response 
procedures. The HMIS must list all hazardous materials stored in a 
building and include the following information:
    1. Hazard class.
    2. Common or trade name.
    3. Chemical name, major components and concentrations if a mixture. 
If a waste, the waste category.
    4. Chemical Abstract Service number (CAS number) found in 29 Code 
of Federal Regulations (CFR).
    5. Whether the material is pure or a mixture, and whether the 
material is a solid, liquid or gas.
    6. Maximum aggregate quantity stored at any one time.
    7. Storage conditions related to the storage type, temperature and 
pressure.
    Section 2.2 of Appendix II-E also requires the submission of an 
amended HMIS ``within 30 days of the storage of any hazardous materials 
which changes or adds a hazard class or which is sufficient in quantity 
to cause an increase in quantity which exceeds 5 percent for any hazard 
class.''
    Air France states in its application that, beginning in June 2002, 
HFD required submission of an HMMP and HMIS in order to obtain a permit 
to store hazardous materials, as well as an additional HMMP and HMIS 
for a second permit to store or handle flammable and combustible 
liquids. It relates HFD refused to accept the HMMPs and HMISs submitted 
by Air France until June 2003, and, during the interval, HFD cited the 
local Air France cargo manager for several violations of the Fire Code, 
including the alleged failures to provide a proper HMIS for the storage 
of hazardous materials and post the required local permit for the 
storage, handling or use of flammable liquids. According to Air France, 
the only way to satisfy HFD's demands was to conduct a survey of the 
shipping papers (manifests and notifications to pilot-in-command) for 
``a prior six-month period in order to estimate the maximum aggregate 
quantities of hazardous materials stored at any one time as required to 
be provided in the HMIS.'' It also states its consultant had to contact 
``numerous shippers and manufacturers'' to obtain common names and 
trade names of hazardous materials which ``are not contained on 
shipping papers.''
    Air France argues these permit requirements create obstacles to the 
accomplishing and carrying out the Federal hazardous material 
transportation law and the HMR, for the same reasons PHMSA found 
``virtually identical HMMP and HMIS requirements'' to be preempted in 
IR-28. According to Air France, the following passage in IR-28, 55 FR 
at 8891, describes the City's permit requirements which impose

extensive (practically exhaustive), extremely detailed, burdensome, 
open-ended, vague and impossible-to-comply-with information and 
documentation requirements as a condition precedent to, inter alia, 
the storage of hazardous materials incidental to the transportation 
thereof without regard to whether that transportation-related 
storage is in compliance with the HMR. For example the detailed 
information required to be provided concerning the identity and 
quantity of hazardous materials (and other materials) which a 
transportation carrier might store at its facility during a given 
year is impossible to compile and provide in advance because a 
common carrier is at the mercy of its customers, including the 
general public, who may without advance notice offer to the carrier 
for transportation virtually any quantity of the thousands of 
hazardous materials listed in, or covered by, the HMR.


[[Page 9418]]


Air France also points to the additional finding in IR-28 that ``the 
City's information and documentation requirements, insofar as they 
relate to the hazardous materials to be stored at a facility incidental 
to transportation, * * * constitute an inconsistent advance notice 
requirement.'' Id. In prior inconsistency rulings, PHMSA had found 
``local requirements for advance notice of hazardous materials 
transportation have potential to delay and redirect traffic and thus 
are inconsistent.'' Id.
    In response, the City described its ``only concern'' as follows:

    [E]mergency response personnel, including in particular the Fire 
Department, must have immediate access to an HMIS and an HMMP in 
order to determine how to address the emergency, and also to ensure 
that local firefighters and other emergency response personnel are 
protected from injury. To the extent that suitable federal versions 
of these documents are available, such as pursuant to 49 CFR 172.600 
et seq., Houston is willing to accept these documents as 
substitutes.

In its reply comments, the City states it ``would not oppose a 
determination'' that its HMIS and HMMP requirements are preempted. 
However, it appears the City has not been accepting the emergency 
response information required by 49 CFR 172.600 et seq., in place of 
its requirements for more detailed information. HFD's six-page 
Hazardous Materials Inventory Routing Form lists 42 categories and 
classes of materials for which an applicant must indicate whether it 
has ``amounts that require a permit'' or ``above exempt amounts.'' The 
instructions define ``hazardous material'' as ``chemicals or substances 
which are physical hazards or health hazards as defined and classified 
by Fire Code Chapter 27 and Code of Federal Regulations CFR 29,'' and 
provide that the inventory form must be submitted ``with permit 
applications or when there is any change in your inventory of more than 
(10) ten percent.'' These documents indicate the City is still 
requiring the detailed information in the HMIS and HMMP.
    Other than the City, the commenters agree the requirements to 
submit the detailed information in the HMMP and HMIS are preempted for 
the same reasons PHMSA set forth in IR-28. The Air Transport 
Association states air carriers ``have no advance notice of the type or 
quantity of dangerous goods that their customers may present for 
carriage,'' and the ``fluid nature of air transportation makes it 
impossible for carriers to comply with detailed local inventory, 
documentation and emergency response requirements without impeding 
their operations under the HMRs.'' The American Trucking Associations 
states ``requirements such as Houston's HMMP and HMIS will operate to 
divert certain hazardous materials around Houston, because many 
transportation companies will find it impossible to comply,'' and such 
potential diversion

is exactly the result Congress sought to eliminate in ensuring 
uniform hazardous materials regulations over the loading, unloading 
and storage incidental to transportation. Requirements such as these 
merely transfer the burden to neighboring jurisdictions and have the 
additional effect of requiring the hazardous materials to travel 
additional miles and spend additional time in transportation. 
Statistically, the amount of time the materials spend in transit and 
the number of miles traveled is directly proportional to the number 
of incidents that will occur. Increased miles will translate to an 
increase in incidents.

    FedEx wrote that, on December 10, 2003, its Houston facility also 
received a notice of violation concerning its HMMP and HMIS and, if 
these requirements ``are allowed to be enforced against carriers, they 
will likely cause the diversion of hazardous materials shipments around 
Houston.'' FedEx states it handles 3.1 million packages each day and it 
has no ``prior knowledge of the contents of each of these packages * * 
*. Essentially, the nature of such packages would change with each 
inbound flight or truck'' and ``generally such packages would not be at 
our facility for more than twenty-four hours.''
    DGAC states ``Houston's HMMP and HMIS [requirements] will likely 
result in the diversion of hazardous materials to avoid Houston,'' and 
it referred to PHMSA's prior findings that information and 
documentation requirements which ``exceeded Federal requirements'' and 
``create potential delay or diversion of hazardous materials during 
transportation'' are an ``obstacle'' and preempted by Federal hazardous 
material transportation law. NEI comments that HFD's collection of 
``information on hazardous materials in storage'' must be in accordance 
with the HMR.
    RSCC states it ``represents manufacturers and carriers of medical 
products destined for patient care'' which ``require expeditious 
handling in all modes. Delay is destructive to the products and harmful 
to the patients who desperately need the treatment these medical 
products provide.'' RSCC compares the City's permit requirements to 
``those addressed in earlier rulings, namely San Jose (IR-28)'' and 
states those requirements give local officials unfettered discretion, 
delay materials in transit, frustrate movement, and provide an 
incentive to divert traffic. RSCC further urges DOT to ask a Federal 
court to enjoin enforcement of the City's permit and containment 
requirements, expressing concern the City will continue to 
``reinterpret[] its requirements to frustrate the DOT ruling process'' 
and, further, the Fire Code is model legislation and ``other municipal 
governments are looking at the same provisions for application in their 
communities.''
    A fundamental problem with the City's information requirements in 
an HMIS and HMMP is that the Fire Code designates, describes and 
classifies hazardous materials in a different manner than the HMR. For 
example, the Fire Code lists materials as ``physical'' and ``health'' 
hazards--which the HMR do not--and includes materials not regulated 
under the HMR, such as carcinogens. Another example is found in the 
Fire Code's definitions of ``flammable'' and ``combustible'' liquids, 
which differ from those in the HMR; a liquid with a flash point between 
100 [deg]F and 141 [deg]F is classified as ``combustible'' in the Fire 
Code but ``flammable'' in the HMR. See 49 CFR 173.120. Further, a 
liquid with a flash point above 200 [deg]F is not regulated under the 
HMR, but it may still be considered ``combustible'' under the Fire 
Code.
    The Fire Code and the HMR differ because the hazardous material 
categories in the Fire Code are based on Title 29 CFR, which ``do not 
necessarily match the classifications used by other federal agencies 
such as the Department of Transportation and EPA.'' Shapiro, ``Using 
the Hazardous Materials Provisions in U.F.C. Article 80 and U.B.C. 
Chapter 9,'' International Fire Code Institute Fire Code Journal, vol. 
1, No. 3 (Summer 1992), p. 4. The information available to a carrier 
from the shipping paper is not sufficient for the HMIS required under 
the Fire Code, as confirmed by the fact Air France's consultant had to 
contact shippers and manufacturers for common names and trade names of 
materials transported through IAH during a prior six-month period. The 
Federal hazardous materials transportation law preempts permit 
requirements in the Fire Code which require the submission of 
information for hazardous materials being stored during transportation, 
because those materials are designated, described, and classified in a 
manner which is not substantively the same as in the HMR. 49 U.S.C. 
5125(b)(1)(A).
    A second problem, discussed in IR-28, is a conflict with the 
emergency

[[Page 9419]]

response information requirements in the HMR, which provide certain 
emergency response information must be provided by an offeror and 
maintained by a carrier at ``a facility where a hazardous material is 
received, stored or handled during transportation * * * in a location 
that is immediately accessible to facility personnel in the event of an 
incident involving the hazardous material.'' 49 CFR 172.602(c)(2); see 
55 FR at 8892. This information must be ``[a]vailable for use away from 
the package containing the hazardous material'' and may be presented on 
a shipping paper or on a separate document which describes the 
hazardous material or is ``[r]elated to the information on a shipping 
paper * * * in a manner that cross-references the description of the 
hazardous material on the shipping paper.'' 49 CFR 172.602(b)(2) & (3). 
Accordingly, under the HMR, the document(s) containing this emergency 
response information form part of the ``shipping documents'' which must 
accompany a hazardous materials shipment. However, the City requires 
additional information in the HMMP and HMIS and effectively precludes 
the use of these shipping documents to provide the necessary emergency 
response information. Federal hazardous material transportation law 
preempts the Fire Code's permit requirement, which includes the 
submission of an HMMP and HMIS, because this requirement is not 
substantively the same as requirements in the HMR concerning the ``use 
of shipping documents related to hazardous material.'' 49 U.S.C. 
5125(b)(1)(C).
    Moreover, the detailed information requirements required in order 
to obtain a permit from the HFD in order to temporarily store hazardous 
materials at IAH constitute an advance notice requirement which causes 
the likelihood for diversion and delay in the transportation of 
hazardous material. As discussed in IR-28, HMMP and HMIS requirements 
are extensive, extremely detailed, and, in the case of a common 
carrier, ``impossible to comply with'' because ``a common carrier is at 
the mercy of its customers, including the general public, who may 
without advance notice offer to the carrier for transportation 
virtually any quantity of any of the thousands of hazardous materials 
list in, or covered by, the HMR.'' 55 FR at 8891. In the case of Air 
France, every incoming or outgoing flight at IAH (or vehicle delivery 
to or from IAH) could result in an increase or decrease of more than 
10% in its ``inventory'' of one or more of the 42 categories and 
classes of materials on the Hazardous Materials Inventory Routing Form. 
Under these circumstances, Federal hazardous material transportation 
law preempts the HMMP and HMIS requirements in the Fire Code because 
the potential for diversion and delay reduces safety in the 
transportation of hazardous materials and creates an obstacle to 
accomplishing and carrying out the purposes and goals of Federal 
hazardous material transportation law and the HMR.

C. Containment and Separation

    In its application, Air France states HFD issued an annual permit 
to handle or store hazardous materials on June 17, 2003, and, ten days 
later, a separate permit to handle or store flammable and combustible 
liquids--but Air France did not actually receive the permits until 
August 6, 2006, when hazardous material storage cabinets were installed 
at the new cargo facility which it subleases from Lynxs. According to 
Air France, HFD required the installation of ``a hazardous materials 
storage cabinet * * * for the storage by Air France of certain in 
transit hazardous materials,'' as a condition of issuing a certificate 
of occupancy. Air France indicates it operates cargo warehouses at six 
other locations in the United States, and none of these jurisdictions 
requires it to obtain a local permit or install and use storage 
cabinets when it handles and stores hazardous materials in the course 
of transportation.
    Lynxs states ``the subject of hazardous materials transportation on 
premises did come up several times,'' prior to construction of this 
facility.

    The overwhelming opinion of all the building developers and 
airlines who occupy these buildings was that the handling standards 
which had been issued by DOT * * * were fair, adequate and 
appropriate for proper transport of various types of goods that 
might be coming through the buildings on their way to and from the 
aircraft.
    Nevertheless, in January 2003, we were informed that new 
standards would be proposed by the Houston Fire Marshall based on 
his own evaluation of the situations of two of our tenants, one of 
which was Air France. We worked closely with Air France personnel, a 
hazardous materials consultant and the Fire Marshall to find a 
solution that would allow the tenants to occupy and operate in the 
building, but made it clear that we did not agree with either the 
Fire Marshall's jurisdiction or conclusions in this matter. We did 
install specialized hazardous materials lockers outside of the 
buildings for storage of certain in-transit goods.

    In its application, Air France states HFD never identified the 
specific provisions in the Fire Code under which the storage cabinets 
were required, but its application refers to the following provisions:
    Sections 8003.1.3.3 and 7901.8, which require secondary containment 
in buildings, rooms or areas used for storage of hazardous materials 
and flammable or combustible liquids, respectively, in excess of 
certain quantities and also require the separation of incompatible 
materials.
    Sections 8001.11.8 and 7902.1.6, which require separation of 
incompatible materials in storage, in packages larger than 5 pounds or 
one-half gallon, by separating the materials by at least 20 feet, 
isolating the materials by a noncombustible partition, storing liquid 
and solid materials in storage cabinets, or storing compressed gases in 
gas cabinets or exhausted enclosures.
    Sections 8001.10.6 and 7902.5.9, which set forth standards for 
storage cabinets and limit the total quantity of flammable and 
combustible liquids in a storage cabinet to 120 gallons.
    Air France also states HFD provided Air France with a copy of 
tables of ``exempt amounts'' in the Fire Code and indicated that 
hazardous materials exceeding these amounts must be stored in cabinets.
    Air France asserts the storage cabinet requirement ``has the 
potential to create confusion'' and ``create delays and diversions in 
the transportation of hazardous materials.'' It states ``the storage 
cabinet required by the Fire Department is only able to hold a limited 
amount of hazardous materials,'' and

    When the cabinet is full (or other incompatible materials are 
already stored in the cabinet) hazardous materials may have to be 
shipped through other jurisdictions using a more circuitous routing 
in order to reach their final destination. Thus, the Fire 
Department's storage cabinet requirement could have a direct impact 
on the length of time certain shipments of hazardous materials 
remain in transit thereby increasing the risk associated with their 
transportation. In fact, within the first few days of using the 
storage cabinet, Air France had to delay for two days the acceptance 
of a shipment of flammable liquid due to the lack of space in the 
cabinet.

    Air France also states the requirement to store hazardous materials 
in a cabinet will increase the number of times that hazardous materials 
must be handled at the warehouse and therefore increases the risk of 
mishap. It argues ``the obvious potential for delays and diversions'' 
distinguishes this storage cabinet requirement from lack of information 
in PD-12(R) on which to base a decision whether the New York secondary 
containment requirement

[[Page 9420]]

``actually cause[d] delays or diversions in the transportation of 
hazardous materials.'' It states HFD was being irrational in treating 
it differently from ``retail establishments like a Home Depot or a Wal-
Mart'' which it states are allowed to store many more times the amount 
of flammable and combustible liquids before exceeding the ``exempt'' 
limits.
    In response, the City states these storage cabinets or ``lockers 
were not and are not mandated by the City,'' but, rather,

    The installation and use of the lockers was in fact proposed by 
Air France as an alternative to complying with standard facility 
safety systems and construction requirements applicable to buildings 
in which hazardous materials over an exempt amount are stored. This 
includes such basic items as sprinkler systems adequate to contain a 
hazardous materials incident, ventilation systems, emergency power 
supplies for these systems, and secondary containment requirements 
that are required by the Houston Fire Code for all buildings in 
which hazardous materials over a certain volume are stored. Had 
these measures been installed as part of the building's 
construction, or thereafter, the lockers would not be necessary. In 
other words, the lockers provide an equivalent level of safety to 
local facilities construction requirements. The alternative to using 
the lockers would be to install the safety measures that are basic 
to any local facility that stores hazardous materials.

    The City also states the ``Fire Code provisions applicable to 
facilities construction'' are ``of particular importance in Houston 
because the City has no zoning requirements,'' and ``a warehouse in 
which hazardous materials are stored may be located next to a school or 
a neighborhood.'' It asserts if there is ``preemption on the facilities 
issues, the City could be left without the power to require such basic 
items as sprinkler systems and secondary containment systems in 
facilities throughout the City where hazardous materials are stored.'' 
The City asks that any decision of preemption ``be limited to on-
airport property.'' In its reply comments, the City states the ``public 
interest would be served by establishing the extent to which any 
preemption determination in this docket is applicable not just to the 
City but other municipalities, airports, and entities.''
    The City also acknowledges that any differing ``packaging 
requirements applicable to the air transportation of hazardous 
materials are preempted by federal law.'' It disputes the arguments of 
several commenters, including FedEx and the American Trucking 
Associations, that a requirement for storage cabinets or lockers is 
preempted as a packaging requirement and refers to PD-5(R), 
Massachusetts Requirement for an Audible Back-up Alarm on Bulk Tank 
Carriers Used to Deliver Flammable Material, 58 FR 62707 (Nov. 29, 
1993). In this determination, PHMSA found a ``back-up'' alarm is not 
``a part of the package or container in which flammable materials are 
transported'' and also stated a `` `package or container that is 
represented, marked, certified or sold as qualified for use in the 
transportation of hazardous materials' * * * does not include the 
equipment or vehicle used to hold or transport that `package or 
container.' '' Id. at 62710.
    American Trucking Associations (ATA), FedEx, DGAC, and RSCC all 
argue the requirement for temporarily storing hazardous materials at 
IAH in a storage cabinet conflicts with the packaging requirements in 
the HMR. ATA and FedEx assert the ``specialized storage cabinet is 
nothing more than a temporary additional packaging that complicates the 
loading and unloading processes'' because this requirement means 
``hazardous materials that are being transferred from one vehicle, 
across a dock, into another vehicle [must be] temporarily placed in a 
hazardous materials storage cabinet.'' RSCC states a requirement for 
secondary containment, including the use of a storage cabinet or 
locker, challenges ``the adequacy of the packaging for hazmat in 
transportation--a covered subject under 49 U.S.C. 5125(b) in which the 
community has no discretion to regulate.'' DGAC states:

    The required use of storage cabinets certainly is a form of 
packing or repacking that goes beyond the extensive federal 
packaging requirements; and the required secondary containment 
certainly is a form of handling since special handling would be 
necessary to place packages in some form of secondary containment.

    ATA and FedEx also argue the City's requirements for ``transloading 
operations'' and the storage of hazardous materials in excess of 
certain quantities in storage cabinet requirements ``go far beyond the 
requirements of the HMRs and create an obstacle to the transportation 
of hazardous materials.'' ATA states ``on at least one occasion, the 
Applicant has been forced to delay transportation of hazardous 
materials as a result of the Houston Fire Code requirements,'' 
according to Air France's application. ATA also contends the City's 
``secondary containment requirements will lead transportation carriers 
to locate their facilities outside of Houston, thereby requiring the 
transportation of greater quantities of hazardous materials for greater 
distances.'' It states the possible ``diversion[s] of hazardous 
materials to neighboring jurisdictions * * * result in additional 
vehicle miles traveled and additional time that the hazardous materials 
must remain in transportation,'' which create ``obstacles to the safe 
and efficient transportation of hazardous materials.''
    Lynxs states the storage lockers ``provide effective protections'' 
but ``inhibit[] the free flow of materials to and from the aircraft and 
create extra handling in some cases'' and are ``not consistent with our 
understanding of [PHMSA] design intentions in the case of air cargo 
facilities.'' IATA states differing local requirements on the 
transportation of hazardous materials will ``complicate the procedures 
that apply to transportation companies'' and ``also add to the 
confusion of employees who are being trained in the proper handling of 
hazardous materials.'' CORAR states local requirements for storing 
flammable liquids in cabinets ``pose an obstacle to compliance with the 
HMR.''
    The HMR define ``package'' as ``a packaging plus its contents'' and 
a ``[p]ackaging means a receptacle and any other components or 
materials necessary for the receptacle to perform its containment 
function in conformance with the minimum packing requirements of this 
subchapter.'' 49 CFR 171.8. Air France transports hazardous materials 
in individual ``packages'' to and from IAH, and these individual 
packages may be transferred between Air France and other carriers in 
the course of transportation. A storage cabinet for temporary in-
transit storage at IAH is not any part of a ``package'' or 
``packaging.'' Rather than serving as any type of ``packaging,'' the 
storage cabinets appear to have two entirely different purposes, 
regardless of whether the cabinets were required by HFD or a 
``solution'' worked out with HFD to allow Air France to use its new 
cargo warehouse: (1) Separation of incompatible materials (see sections 
7902.1.6 and 8001.11.8), and (2) secondary containment (see Sections 
7902.5.9 and 8001.10.6, construction requirements).
    In contrast to the Fire Code's specific requirements in Sections 
7902.1.6 and 8001.11.8 for separating ``incompatible'' materials by a 
20-foot distance, partitions, or storage cabinets, the HMR require 
``packages containing hazardous materials which might react dangerously 
with one another may not be placed next to each other or in a position 
that would allow a dangerous

[[Page 9421]]

interaction in the event of leakage.'' 49 CFR 175.78(a). The 
segregation table in Sec.  175.78(b) also sets forth specific classes 
and divisions of materials which, at a minimum, ``may not be stowed 
next to or in contact with each other, or in a position which would 
allow interaction in the event of leakage of the contents.'' These 
segregation requirements in the HMR apply to the ``handling'' of 
hazardous materials in temporary storage during transportation. Federal 
hazardous materials transportation law preempts the separation 
requirements in sections 7902.1.6 and 8001.11.8 which are not 
substantively the same as the requirements in the HMR. 49 U.S.C. 
5125(b)(1)(B).
    Otherwise, the HMR do not contain requirements regarding secondary 
containment at a facility where hazardous materials are stored during 
transportation. As stated in PD-12(R), it is ``too broad to read IR-28 
as finding that any non-Federal requirement for secondary containment 
at a transfer facility is unnecessary and an obstacle to the 
accomplishment and carrying out the HMR.'' 62 FR at 15972. A 
requirement for secondary containment, including storage cabinets or 
lockers, does not appear to be inherently inconsistent with the 
handling or packaging requirements in the HMR, as those terms apply to 
the standard in 49 U.S.C. 5125(b)(1)(B) that non-Federal requirements 
on ``the packing, repacking, [and] handling * * * of hazardous 
materials'' must be ``substantively the same as'' the requirements in 
the HMR.
    In the situation described in Air France's application, a shipment 
is unloaded from an aircraft or vehicle at IAH, placed in temporary 
storage, and later removed from temporary storage for loading on the 
aircraft or vehicle transporting the shipment from IAH. Air France has 
not explained how the requirement to temporarily store a package 
containing hazardous materials in a cabinet or locker will change or 
increase the ``handling'' of hazardous materials shipments between 
different aircraft or between an aircraft and a motor vehicle. PHMSA 
does not interpret the City's secondary containment requirements to 
apply to a shipment which is not actually ``stored'' at IAH, such as 
when it is possible for the shipment to be ``transferred [directly] 
from one vehicle, across a dock, into another vehicle,'' as ATA 
discusses.
    The application and comments do not contain sufficient evidence the 
City's storage cabinet requirements, when considered solely as a means 
of achieving secondary containment, are likely to cause diversions and 
delays in the transportation of hazardous materials. Any limitation on 
the capacity of the storage cabinets does not appear to have resulted 
directly from the City's requirements, but rather Air France's estimate 
of how much storage space it would need. There do not appear to be any 
restrictions preventing Air France from delaying acceptance of a 
shipment, or holding a shipment at another location, for a short period 
because the storage lockers constructed by Lynxs are not large enough, 
especially when Lynxs stated it ``worked closely with Air France 
personnel, a hazardous materials consultant and the Fire Marshall to 
find the solution'' of storage cabinets.
    In summary, Federal hazardous material transportation law preempts 
the requirements in sections 7902.1.6 and 8001.11.8 for separation of 
incompatible materials when applied to hazardous materials being stored 
at IAH during transportation, because these are ``handling'' 
requirements which are not substantively the same as the segregation 
requirements in the HMR. 49 U.S.C. 5125(b)(1)(B). On the other hand, 
there is insufficient information to find the secondary containment 
requirements in sections 7901.8 and 8003.1.3.3 in the Fire Code, as 
enforced and applied including the use of storage cabinets described in 
sections 7902.5.9 and 8001.10.6, create an obstacle to accomplishing 
and carrying out the Federal hazardous material transportation law, the 
regulations issued under that law, or a hazardous materials 
transportation security regulation or directive issued by DHS.
    PHMSA is currently considering adopting further requirements on 
storage of certain hazardous materials during transportation, in Docket 
No. PHMSA-2005-22987 (HM-238), ``Hazardous Materials: Requirements for 
the Storage of Explosives and Other High-Hazard Materials During 
Transportation,'' 70 FR 69493 (Nov. 16, 2005). The City, Air France, 
and the other persons who have participated in this proceeding are 
invited to submit comments in PHMSA's HM-238 rulemaking proceeding.

IV. Ruling

    A. Federal hazardous material transportation law preempts the 
following requirements in the Houston Fire Code as applied by the 
Houston Fire Department to the temporary storage of hazardous materials 
during transportation at George Bush Intercontinental Airport, because 
(a) the designation, description, and classification of hazardous 
materials in the Fire Code is not substantively the same as in the HMR; 
(b) these requirements are not substantively the same as requirements 
in the HMR regarding the use of shipping documents to provide emergency 
response information in the event of an incident during the 
transportation of hazardous material; and (c) these requirements 
require advance notification of the transportation of hazardous 
materials which creates an obstacle to accomplishing and carrying out 
the purposes and goals of Federal hazardous material transportation law 
and the HMR:
    1. Sections 105.8.h.1 and 8001.3.1, which require a permit to 
store, transport on site, dispense, use or handle hazardous materials 
in excess of certain ``exempt'' amounts listed in Table 105-C of the 
Fire Code.
    2. Sections 105.8.f.3 and 7901.3.1, which require a permit to 
store, handle, transport, dispense, or use flammable or combustible 
liquids in excess of the amounts specified in Sec.  105.8.f.3.
    3. Sections 8001.3.2 and 8001.3.3, which specify the Houston Fire 
chief may require an applicant for a permit to provide a hazardous 
materials management plan and a hazardous materials inventory statement 
in accordance with the provisions of Appendix II-E of the Fire Code.
    B. Federal hazardous material transportation law preempts the 
separation requirements in sections 7902.1.6 and 8001.11.8 of the 
Houston Fire Code as applied by the Houston Fire Department to the 
temporary storage of hazardous materials during transportation at 
George Bush Intercontinental Airport, because these requirements are 
not substantively the same as the segregation requirements in 49 CFR 
175.78.
    C. There is insufficient information to find Federal hazardous 
material transportation law preempts the secondary containment 
requirements in sections 7901.8 and 8003.1.3.3 in the Houston Fire Code 
as enforced and applied by the Houston Fire Department to the temporary 
storage of hazardous materials during transportation at George Bush 
Intercontinental Airport, including the construction and capacity 
requirements for storage cabinets for secondary containment in sections 
7902.5.9 and 8001.10.6, because the application and comments do not 
show (a) it is impossible to comply with both these requirements and 
the Federal hazardous material transportation law, the regulations 
issued under that law, or a hazardous materials transportation security 
regulation or directive issued

[[Page 9422]]

by the DHS, or (b) these requirements, as enforced and applied, are 
likely to cause diversions or delays in the transportation of hazardous 
materials.

V. Petition for Reconsideration/Judicial Review

    In accordance with 49 CFR 107.211(a), any person aggrieved by this 
decision may file a petition for reconsideration within 20 days of 
publication of this decision in the Federal Register. A petition for 
judicial review of a final preemption determination must be filed in 
the United States Court of Appeals for the District of Columbia or in 
the Court of Appeals for the United States for the circuit in which the 
petitioner resides or has its principal place of business, within 60 
days after the determination becomes final. 49 U.S.C. 5127(a).
    This decision will become PHMSA's final decision 20 days after 
publication in the Federal Register if no petition for reconsideration 
is filed within that time. The filing of a petition for reconsideration 
is not a prerequisite to seeking judicial review of this decision under 
49 U.S.C. 5127(a).
    If a petition for reconsideration is filed within 20 days of 
publication in the Federal Register, the action by PHMSA's Associate 
Administrator for Hazardous Materials Safety on the petition for 
reconsideration will be PHMSA's final action. 49 CFR 107.211(d).

    Issued in Washington, DC, on February 15, 2006.
Robert A. McGuire,
Associate Administrator for Hazardous Materials Safety.
 [FR Doc. E6-2503 Filed 2-22-06; 8:45 am]
BILLING CODE 4910-60-P