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fact that the New York Facilities Line transports huge amounts of gas at high pressure only a few feet below the streets and sidewalks of Manhattan. And I might say Manhattan is honeycombed with tunnels and other underground installations which make possible such migration. It is a very serious problem underneath New York City. We endorse the act insofar as it calls for federally-established minimum safety standards for all gas systems. For safety sake, however, there is no justification for prohibiting the States from establishing local standards more rigorous than the Federal minimum for interstate gas pipelines.

The reasons for preempting the States are not safety reasons. They are purely economic. The intent is to prohibit the States from interfering with interstate commerce.

The act is ill-conceived for this purpose. We know of no State that is attempting or has attempted to impede the construction of an interstate gas pipeline. On the contrary, all of the States are eager for the most possible sources of supply and the greatest possible volumes of gas.

Even pipelines intending only to pass through a State give rise to the opportunity for local gas supplies, because section 7(a) of the Natural Gas Act entitles communities to apply to the Federal Power Commission for gas service from nearby pipelines.

The key to our plea for a State voice on the safety of interstate pipelines within their jurisdiction is that there is no need for uniformity of gas safety rules for interstate lines in order to assure orderly interstate commerce. The pipe itself does not move.

If one State requires pipeline wall thickness of specified dimensions the utility can comply in that State and still meet different standards in adjacent States with no difficulty.

The only thing that moves across State lines is the gas itself. The only applicable safety standards regarding the gas itself concern pressure and odorization. Pressure can be choked down in one State or locality and can be built up elsewhere through compressors. With regard to odorization, all localities do or should require odorization so it is no interference to require the supplying pipeline to odorize the gas-unless the gas is destined for storage-odorants damage storage reservoirs. In that case there should be an exemption.

Uniform safety standards among the States are not necessary for interstate gas commerce in order to avoid burdening this commerce. I would like to tell you something, Senator Hartke, about our own program in New York. We are not satisfied with the safety of gas distribution systems and transmission lines in New York State.

Since I took office February 1, 1970, the gas division of the public service commission, under the direction of George Bonner who is here with me, has moved to improve the State's safety code which has recently been revised and is under study for further amendment, and has moved to improve its inspection and enforcement efforts.

New York State has pioneered in the development of regulations for the isolation and retirement of idle services from gas systems. The office of pipeline safety is now in the process of considering and adopting rules along these lines.

The New York State Public Service Commission recently issued an order requiring the installation of valves on new service lines to pre

vent gas from prematurely entering building as a result of the accident to which the prior witness alluded. The office of pipeline safety is now considering the adoption of that rule.

New York State also pioneered in regulations governing cathodic protection of distribution systems, which is the diverting of electrical interchanges between the pipe and the ground, thus mitigating the deterioration of the pipe metals.

Regulations just issued by the Office of Pipeline Safety correspond closely with regulations we issued concerning cathodic protection. We are drafting an improved classification system for detected gas leaks which may help set repair priorities that will save lives. We hope to interest OPS also in this system.

We shall strive for continuing leadership because we realize the hazards involved and the very great responsibility for the safety of distribution systems and local transmission lines in a State with almost 10 percent of the national population.

I point out our leadership only to make clear that our appeal is not merely on States' rights principles, but rather it grows out of the need and the capability within New York to add measurably to the safety of interstate gas transmission.

The citizens of New York, and other States, cannot wait for Federal standards to catch up with safety needs that are recognized by the States.

Several States have demonstrated they are willing and able to set rigorous safety standards. Federal laws should not deprive them of the right to impose more rigorous standards than the Federal minimums in order to protect their citizens from safety hazards of interstate gas pipelines.

State enforcement and assessment.-The Natural Gas Pipeline Safety Act prohibits the States from enforcing any gas safety regulations governing interstate gas pipelines, either its own or those of the Federal Government-United Gas Pipeline Company v. Terrebonne Parish Police Jury, 319 F. Supp. 1138 (1970). All that the States may do with regard to interstate gas pipelines is act as the agent of the Federal Government, by agreement, to exercise surveillance over the safety programs of the pipelines. Upon discovery of a violation of the Federal code, neither the State inspector nor the State commission may require compliance, but can only report to Washington that the pipeline has not complied with the Federal code. It is then up to the Department of Transportation to conduct its own investigation to determine if in fact a violation has taken place. Defects resulting from noncompliance associated with construction practices or underground equipment would have been long buried before anyone could arrive on the scene from Washington. The Office of Pipeline Safety had only 21 professionals during fiscal year 1971, including only two field inspectors, both of who are based in Houston, Tex., plus seven clerical personnel. Not all of these are assigned to interstate gas pipeline work. Some work on minimum standards for distribu

1 While that decision may be correct as a matter of statutory interpretation, we challenge the constitutionality of the Federal Government's effort to prevent the States from protecting their citizens against the safety hazards of interstate gas pipelines. Unfortunately, a lawsuit attacking the constitutionality of the Act in this regard would undoubtedly take time, during which the safety of our citizens would be inadequately protected. We therefore press for necessary remedial Federal legislation.

tion systems and local transmission lines, on administrative matters, and on other office chores. The State of New York alone now has a staff of 21 engineers and inspectors working full time on gas safety plus 31 others working partly on gas safety and partly on other gas

matters.

Even the provision for State surveillance of interstate gas pipeline safety practices, circumscribed as it is, has been frustrated by the interpretations of the Office of Pipeline Safety concerning State financing of the safety measures. According to OPS, the States must bear the entire cost of their safety inspections of interstate gas pipelines on behalf of the Federal Government. On October 30, 1970, the Acting Director of the Office of Pipeline Safety advised all State agencies that they no longer had authority to assess interstate pipeline companies to defray part or all of the State's costs of safety inspections and surveillance, even if such assessments could be made with respect to distribution systems and local transmission lines. As a result, New York and Pennsylvania have terminated their agency relationship with OPS, so that there is no longer any effective safety program for interstate gas pipelines as a practical matter in these populous States. It passes my understanding why OPS is insistent that the prevailing assessment practices of the States should not be applied to interstate pipelines. To require the legislatures to establish a special financial arrangement for this safety service seems totally unreasonable. Many other States may be forced to follow suit.

It is becoming increasingly difficult if not impossible for States to increase taxes to pay for surveillance over interstate gas pipelines, taxes that would be especially difficult to justify since there is no opportunity for direct State enforcement and there are correspondingly reduced benefits in terms of improved safety. The restoration of the States' authority to assess pipelines is essential.

S. 1910 goes part way. OPS has viewed State surveillance programs for interstate gas pipelines as not eligible for Federal matching grantsin-aid, and section 3 of S. 1910 would amend the Act to extend the grants-in-aid program to cover such surveillance programs. While we support that amendment to help those States that might take advantage of it, it will cover 50% of the costs, at most. I am sure that many States will be unable to carry on a surveillance program for interstate gas pipelines unless they are authorized to assess the pipelines for the remaining costs that would be borne by the States.

The statutory amendments we propose in attachment II would strike from the act the prohibition against the States' asserting and enforcing rigorous safety programs for interstate gas pipelines. Those amendments would, by restoring the States' general authority, eliminate any basis for OPS's extraordinary ruling that the States may not assess interstate gas pipelines for safety efforts related to those pipelines. If Congress decides not to restore general safety authority to the States, it must at least amend the act to make clear that States may use their assessment powers to cover the State surveillance programs that are now expressly authorized in act. In the absence of State assessment at least for surveillance, all hopes for achieving interstate gas pipeline safety may collapse.

S. 1910: IMPROVEMENTS IN STATE REGULATION OF INTRASTATE GAS SYSTEMS

Judicial sanctions. S. 1910 would improve the Natural Gas Pipeline Safety Act by clarifying the enforcement authority of the States. The act now provides that State safety standards for distribution systems and local transmission lines are effective only if they are enforceable by injunctive and monetary sanction "substantially the same" as certain Federal sanctions. The Department of Transportation has erroneously interpreted the act as disqualifying State gas safety programs unless the State safety agency (like the Federal Office of Pipeline Safety) possesses authority to impose injunctive and monetary sanctions. The Department of Transportation apparently concedes that some States have adequate judicial processes for injunctive and monetary sanctions, which the State agency could pursue through State courts. Nevertheless, the Department of Transportation deems these judicial sanctions statutorily inadequate because not "substantially the same" as the Federal sanctions.

Section 2 of S. 1910 would relieve everyone of the burden of this narrow reading of the act by inserting "or the courts of the State" in the provision calling for State sanctions. Many States have already acted to give their agencies injunctive and monetary sanction powers meeting the tests of the Federal act as interpreted by OPS. Nevertheless, S. 1910 will enable at least a few other States to qualify under the act, States which are now barred from asserting and enforcing their otherwise acceptable State gas safety programs. The States would be free under S. 1910 to decide whether the agencies or the courts or both are qualified to impose sanctions.

Grants-in-aid. S. 1910 would also strengthen the State gas safety programs by clarifying and improving the Federal grants-in-aid program. Section 3 of S. 1910 would make clear that grants-in-aid money may be made available for State work on the safety of interstate pipeline facilities as well as on State safety regulation of distribution systems and local transmission lines.2 Section 4 of S. 1910 would require that the Secretary of Transportation certify his apportionment of funds well before the commencement of each fiscal year. This important amendment will, for the first time under the act, make known to the States the extent of their entitlement before the State legislatures have appropriated their own money for State gas safety programs. The timing is crucial because the Federal grants-in-aid are limited to 50 percent of the cost of the State program. Even if a State would otherwise be entitled to a $50,000 grant, a State safety program that costs $80,000 would be entitled to only a $40,000 grant. Only if the States know in advance the amount of grants-in-aid they might receive will they be able to take full advantage of the Federal funds intended for the States; and only in that way will the Federal program draw in the maximum possible State investment in safety.

Section 5 of S. 1910 amends the grants-in-aid program in other salutary ways. It provides for progress payments to the States out of the Federal fund as State gas safety programs are enforced.

The Department of Transportation supports this aspect of S. 1910, but only this aspect. See the letter from Department of Transportation General Counsel John W. Barnum to Chairman Warren G. Magnuson of the Senate Committee on Commerce, dated September 29, 1971.

S. 1910 unfortunately does not address the issue of funding the grants-in-aid program. Since adequate funding of State enforcement agencies is crucial to the success of the National Gas Safety Program, we urge that section 14 of the act be amended to require the Department of Transportation to analyze the financial needs of these State agencies and to present the results of such analysis in its report for the calendar year 1972 so that Congress may then establish an adequate grants-in-aid fund. A proposed amendment to this effect is contained in attachment IV.

Other pending bills. S. 1910 is preferable to the other pending bills, S. 980 and H.R. 5065. The other two bills do not contain the several improvements in the Federal grants-in-aid program reflected in S. 1910. Also the other two bills fail to allow the States to keep their injunctive and monetary sanction powers in the hands of their courts. Section 1 of H.R. 5065 would extend until August 12, 1972, the time for States to make their monetary and injunctive sanctions substantially the same as the Federal sanctions. This amendment is important whether or not Congress decides to allow the States to pursue their sanctions through State courts instead of State safety agencies. Unless the State sanctions were substantially the same as the Federal sanctions by August 12, 1970, the State safety programs are inoperative. For example section 9 of the act provides for a $1,000 Federal penalty for each safety violation for each day that the violation persists, with a maximum penalty of $200,000 for a related series of violations. If the State monetary penalty is not substantially the same as this Federal penalty, the State may not regulate gas safety. I suppose it would have been best if all the States had conformed their sanctions by now. However, the Federal Government is not now adequately staffed to take over State programs. It would appear necessary to delay the time when a State safety program becomes inoperative because of differences between State sanctions and the Federal sanctions. Without that delay there may be no effective gas safety programs in several States. S. 1910 should therefore be amended to provide that section 5(a) of the Natural Gas Pipeline Safety Act (49. U.S.C. 1674 (a)) be amended by striking out "2 years" and inserting in lieu thereof "4 years," extending the time for compliance to August 12, 1972.

I should note in favor of H.R. 5065 that section 2 of that bill would amend the act to make grants-in-aid mandatory to the extent funds are appropriated. H.R. 5065 would change the phrase "the Secretary is authorized to pay" to "the Secretary shall pay." S. 1910 would be improved by that change of phrase.

I should also note that S. 1910 leaves blank in section 4 the amounts of the grants-in-aid fund. Section 3 of H.R. 5065 authorizes amounts for the entire Federal program that we doubt are sufficient for the grants-in-aid fund alone ($3,000,000 for the fiscal year ending June 30, 1972; $3,800,000 for the next fiscal year; and $5,000,000 for the next fiscal year). The amount of authorization should be determined after a more thorough analysis has been made of the financial needs of State safety programs. In attachment II we propose an amendment to require a prompt study of these important financial considerations.

We strongly urge enactment of S. 1910, changed to make the grants

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