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Statement of Need: This rulemaking would respond to the Pipeline Safety, Regulatory Certainty, and Job Creation Act of 2011 (P.L. 112-90), which includes several provisions and mandates that are relevant to the 49 CFR including section 195.452 (hazardous liquid integrity management). The rule also would respond to several NTSB recommendations, a GAO recommendation, public safety community input, research and technology advancements, and reviews of recent incident and accident reports to refine and improvement of existing hazardous liquid regulations. This action would better protect the public, property, and the environment by ensuring that additional pipelines are subject to regulation, thus increasing the detection and remediation.

Summary of the Legal Basis: Congress established the current framework for regulating the safety of hazardous liquid pipelines in the Hazardous Liquid Pipeline Safety Act (HLPSA) of 1979 (P.L. 96-129). Like its predecessor, the Natural Gas Pipeline Safety Act of 1968 (P.L. 90-481), the HLPSA provided the Secretary of Transportation (Secretary) with the authority to prescribe minimum Federal safety standards for hazardous liquid pipeline facilities. That authority, as amended in subsequent reauthorizations, is currently codified in the Pipeline Safety Laws (49 U.S.C. §§ 60101 et seq.).This action would respond to the Pipeline Safety, Regulatory Certainty, and Job Creation Act of 2011 (P.L. 112-90), which requires that the Secretary of Transportation to study and submit to Congress reports on various topics related to hazardous liquid transportation by pipeline and to amend the current pipeline safety statutes through the rulemaking process after submission of these reports. The mandates which this rule responds to are found in Section 5(IM), Section 8 (leak detection), Section 21 (Gathering Lines), Section 29 (seismicity) and Section 14 (bio fuels).

Alternatives: PHMSA considered various alternatives for each of the eight proposals of this NPRM. The alternative considered for all proposals was "no action or status quo" in addition to other various appropriate alternatives. Other alternatives reviewed included establishing different requirements for the large and small operators; creating a "Monitored" category; application of the existing IM repair criteria to anomalous conditions discovered outside of HCAs, use of a tiered, risk-based approach for repairing anomalous conditions discovered outside of HCAs, require ILI assessment for all pipelines and a rigid structured data integration program. Special consideration was given to alternatives that lessened regulatory burdens and provided operator flexibility in performance of a requirement.

Anticipated Costs and Benefits: PHMSA cannot estimate costs or benefits precisely, but based on the information, the present value of costs and benefits over a 20-year period is approximately $56 million and $98 million, respectively at 7 percent. Thus, net benefits are approximately $46 million ($102 million - $56 million) over 20 years.

Risks: This rulemaking would provide increased safety for the regulated entities and reduce pipeline safety risks.