[Federal Register Volume 76, Number 133 (Tuesday, July 12, 2011)]
[Rules and Regulations]
[Pages 40820-40822]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2011-17231]


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DEPARTMENT OF TRANSPORTATION

Pipeline and Hazardous Materials Safety Administration

49 CFR Part 190

[Docket No. PHMSA-2011-0161]


Pipeline Safety; Enforcement Proceedings Involving an Informal 
Hearing

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

ACTION: General policy statement; informal hearing process.

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SUMMARY: PHMSA is issuing this document to notify operators of natural 
gas and hazardous liquid pipeline facilities of the creation of a 
dedicated ``Presiding Official'' for informal pipeline enforcement 
hearings and the process operators can expect when requesting an 
informal hearing. Hearings in pipeline safety enforcement cases are 
conducted by a hearing officer in accordance with certain procedures 
designed to ensure a fair and impartial decision on the merits. This 
document explains those procedures and includes a description of the 
dedicated hearing officer's roles and responsibilities, the process for 
requesting a hearing, and the manner in which a case will proceed once 
a hearing has been requested.

FOR FURTHER INFORMATION CONTACT: Sherri Pappas, Deputy Chief Counsel, 
at 202-366-4400. Information about PHMSA may be found at http://phmsa.dot.gov.

SUPPLEMENTARY INFORMATION:

I. Background

    The Federal safety statute and regulations for natural gas and 
hazardous liquid pipeline facilities provide a description of the 
enforcement authority and sanctions exercised by the Associate 
Administrator for achieving and maintaining pipeline safety. Pursuant 
to chapter 601 of Title 49, United States Code, after notice and an 
opportunity for a hearing, the Associate Administrator may order an 
operator of a pipeline facility to take necessary corrective action, 
including revisions to

[[Page 40821]]

its procedures, and may assess a civil penalty for a violation of a 
pipeline safety regulation or order (49 U.S.C. 60108(a), 60112, 
60117(l), 60118(b), and 60122). The regulations also prescribe the 
procedures governing the exercise of that authority and the imposition 
of those sanctions. In general, subpart B of 49 CFR part 190 (190.201-
190.239) provides an opportunity for a pipeline operator to submit a 
written answer and/or request a hearing prior to the issuance of any 
order that makes a finding of violation, assesses a civil penalty, or 
requires corrective measures to be taken.
    Effective immediately, and to the extent practical, all timely 
requested hearings will be held before the designated hearing officer 
or ``Presiding Official'' within PHMSA.

II. Hearing Officer

    The person within PHMSA who conducts hearings relating to civil 
penalty assessments, compliance orders, or safety orders is the 
designated hearing officer. The person is a senior attorney within the 
Office of Chief Counsel, on the staff of the Deputy Chief Counsel. To 
ensure the fairness and impartiality of the proceeding, the hearing 
officer is outside the line of authority of the Associate Administrator 
as well as any staff involved in the investigation and prosecution of 
the enforcement case. The dedicated hearing officer is not engaged 
personally in any investigative or prosecutorial functions with regard 
to enforcement matters, such as preparation of notices of probable 
violation relating to civil penalty assessments and compliance orders, 
and notices relating to corrective action orders and safety orders.
    The roles and responsibilities of the hearing officer are 
consistent with current statutory and regulatory authority. They 
include scheduling the hearing, holding pre-hearing conferences as 
necessary, disposing of procedural requests or similar matters, 
regulating the course of the hearing, ensuring an opportunity for a 
full and complete record to be established, making a recommended 
decision in the matter, and taking any other authorized action where 
appropriate.

III. Separation of Functions

    Formerly, hearings were held before several different attorneys 
from the Office of Chief Counsel and were assigned to an attorney who 
had no role in the investigation and prosecution of the case being 
heard. Now, all hearings will be held, to the extent practical, before 
the designated hearing officer, who will have no role in the 
investigation and prosecution of any enforcement cases.
    To ensure the impartiality and fairness of the decision-making 
process, a hearing officer is (and has been) held to certain standards 
regarding ``ex parte'' communications. An ex parte communication is any 
informal communication between a party in a pending case and the 
hearing officer regarding an issue in that case, occurring outside the 
presence of the other parties and without notice and opportunity for 
all parties to provide comment or rebuttal. If an enforcement case is 
pending before a hearing officer, ex parte communications with the 
hearing officer are not permitted by the operator, its counsel, or 
agency staff involved in the investigation and prosecution of the case. 
This applies to communications regarding information, facts, and 
arguments regarding an issue in the case, but not routine 
administrative matters, such as scheduling the hearing or providing 
clarification about the enforcement process. This restriction also does 
not apply to communications between the parties themselves.
    In addition, an individual engaged in the performance of 
investigative or prosecuting functions for the agency in a case may 
not, in that or a factually related case, participate in the attorney's 
recommended decision, but may participate at the hearing as a witness 
or counsel and submit a recommendation pursuant to Sec.  190.213(b)(4).

IV. Requesting a Hearing

    Section 190.209 provides that upon receipt of a notice of probable 
violation, proposed civil penalty, or proposed compliance order, an 
operator may respond within 30 days by paying the proposed penalty, 
agreeing to the proposed compliance order, submitting written 
information in answer to the notice, or requesting a hearing. Sections 
190.233 and 190.239 also provide for responding to a notice of proposed 
corrective action order or notice of proposed safety order, including 
the option of requesting a hearing.
    Pursuant to Sec.  190.211, any request for a hearing must be 
accompanied by a statement of the issues that the respondent intends to 
raise at the hearing. The issues may relate to the allegations in the 
notice, proposed corrective actions, or the proposed civil penalty 
amount. The request should also indicate whether or not the operator 
will be represented by counsel at the hearing.
    The right to a hearing is waived if not requested within 30 days of 
receipt of the notice. An operator that submits a written response 
without specifically requesting a hearing will be deemed to have waived 
the right to a hearing, but the written material timely submitted will 
be fully considered in the rendering of a decision in the matter. An 
operator that requests only to ``reserve its right to a hearing'' will 
be subject to the scheduling of a hearing unless the hearing request is 
withdrawn.

V. Pre-Hearing Matters

    Within a reasonable time after the request for a hearing, the 
hearing officer will ensure that the respondent has an opportunity to 
review all materials in the enforcement record pertinent to the issues 
to be determined. The enforcement record includes the notice and the 
violation report with exhibits that are comprised of documents gathered 
during the inspection and any other information included by the 
inspector that is relevant to the allegations.
    The hearing officer will schedule the hearing, provide written 
confirmation to the parties of the date, time and location, and request 
a list of anticipated attendees. The hearing officer will also instruct 
parties that all documents, evidence, or exhibits in support of the 
case should be exchanged by furnishing a copy to all parties and 
submitted at least ten days prior to the hearing. Any party intending 
to introduce documents, evidence, or exhibits during the hearing will 
also be directed to furnish copies to all parties.
    The hearing officer will address all procedural matters, including 
but not limited to, motions for extensions of time, stipulations in 
lieu of a hearing on particular issues, or withdrawal of a hearing 
request. The hearing officer may direct that a request contain 
sufficient detail, be specific as to the reason(s) for the request, and 
be served on the appropriate PHMSA regional office.

VI. Hearing

    All hearings are held in accordance with Sec.  190.211 and are 
conducted in an informal manner. The informal nature of the hearing 
alleviates the need for the parties to strictly comply with formal 
rules of evidence and rules of procedures. While the hearings are not 
``formal,'' the hearing officer will take appropriate actions to 
maintain an appropriate level of fairness and efficiency during the 
proceeding. In addition, and with the assistance of the parties, the 
hearing officer will ensure the hearing is conducted cordially and that 
the parties maintain proper decorum at all times.
    Hearings are currently held either telephonically or in person. 
They may

[[Page 40822]]

also be held by video teleconference in the future. During the hearing, 
the operator can expect the region issuing the notice to introduce the 
allegations and provide an explanation as to the evidence gathered in 
support. The operator will then have the opportunity to present its own 
information, facts, evidence, explanations, and arguments in response. 
The operator may submit any material relevant to the issues under 
consideration, and may call witnesses on its behalf and examine the 
evidence and witnesses presented by the region. At the close of the 
operator's presentation, the hearing officer may allow the presentation 
of any rebuttal information by the region, and respondents may then 
respond to that information.
    The hearing officer ensures that all parties have an ample 
opportunity to present their position and supporting evidence, and will 
end discussion on a topic only once it is clear that all the issues 
have been fully examined. Questions may be asked by the hearing officer 
during either party's presentations. In addition, the informal nature 
of the proceeding allows the parties to ask questions of one another, 
although parameters may be established to ensure the parties have 
sufficient uninterrupted time to make their presentations. The hearing 
officer ensures that discussion stays focused on the relevant and 
determinative matters in the case and avoids allowing tangential issues 
to become a distraction. The hearing will last as long as necessary to 
ensure the parties have ample opportunity to present their case, 
although the hearing officer will attempt to accommodate the parties' 
schedules to the extent practicable.
    Written materials and evidence presented at the hearing will be 
collected by the hearing officer for insertion into the record. 
Hearings are not recorded and are not transcribed, but if requested in 
advance of the hearing, the respondent may make arrangements for the 
hearing to be transcribed at its own expense, provided that a copy of 
the final transcript is submitted for the record. The hearing officer 
may take notes, including electronic notes and recordings during the 
hearing, but such personal notes are not part of the official record or 
maintained by the agency.
    At the close of the hearing, the respondent may request an 
opportunity to submit further written material for inclusion in the 
record. The hearing officer will allow a reasonable time for the 
submission of the material, but if the material is not submitted within 
the time prescribed, the case will proceed to final action without the 
material.

VII. After the Hearing

    If post-hearing documents contain new evidence or new arguments, 
the hearing officer will provide written notification to all parties 
and direct the parties to respond within a certain amount of time. The 
hearing officer may also request that additional documents be submitted 
after the hearing, if necessary, to fully develop the record.
    The hearing officer will ensure that all material submitted before 
and during the hearing is placed in the record. At this stage, the 
record will include the notice, violation report, written statements by 
the parties, evidence submitted, list of hearing attendees, any hearing 
transcript, and any other pre-hearing or post-hearing documents 
submitted by the parties.
    Upon the close of a hearing and receipt of all post-hearing 
submissions, the hearing officer will prepare a recommended decision to 
be issued by the Associate Administrator. The restriction on ex parte 
communications discussed above is especially applicable at this stage 
of the proceeding, and the hearing officer will not engage in such 
discussions or communications regarding the case with anyone involved 
in the prosecution or defense of the notice. The hearing officer's 
recommended decision may be reviewed by the Deputy Chief Counsel and 
staff of the Associate Administrator prior to issuance by the Associate 
Administrator.
    Upon signature of the decision by the Associate Administrator, 
PHMSA will serve the decision upon the respondent and the applicable 
region in accordance with Sec.  190.5. Decisions by the Associate 
Administrator are also made publicly available on the PHMSA Enforcement 
Transparency Web site.

    Issued in Washington, DC, on July 1, 2011.
Bizunesh Scott,
Chief Counsel.
Jeffrey D. Wiese,
Associate Administrator for Pipeline Safety.
[FR Doc. 2011-17231 Filed 7-11-11; 8:45 am]
BILLING CODE 4910-60-P