BILL ANALYSIS �
AB 2559
Page 1
Date of Hearing: April 25, 2012
ASSEMBLY COMMITTEE ON LOCAL GOVERNMENT
Cameron Smyth, Chair
AB 2559 (Buchanan) - As Amended: April 17, 2012
SUBJECT : Natural gas pipelines: pipeline integrity management.
SUMMARY : Requires local entities to expedite permitting for
pipeline integrity management projects. Specifically, this
bill :
1)Requires the California Public Utilities Commission (CPUC) to
ensure that a local entity is provided notice by a gas
corporation whenever a pipeline integrity management plan, as
defined, may result in the gas corporation undertaking
pipeline inspection, remediation, or replacement work within
the jurisdiction of the local entity, and the work is likely
to require action by the local entity to approve or facilitate
the work.
2)Requires a local entity provided with notice to expedite any
permitting or other actions necessary to complete any pipeline
inspection, remediation, or replacement work within the
jurisdiction of the local entity that is necessary to an
approved pipeline integrity management plan.
3)Prohibits the local entity from imposing permit requirements
that exceed the scope of the proposed pipeline project, unless
the additional requirements specifically relate to the project
and are necessary for public safety.
4)Defines the following terms:
a) "Pipeline integrity management plan" means the written
integrity management program prepared by a gas corporation
to comply with the requirements adopted by the federal
Pipeline and Hazardous Materials Safety Administration of
the Department of Transportation, as specified.
b) "Expedite any permitting" means to issue a decision on a
permit within 10 business days of the submission of the
permit application. Where a local agency cannot issue a
decision on a permit within 10 business days of the
submission, the agency shall provide a written explanation
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to the utility applying for the permit, and shall provide
the utility with a timeline by which the agency will, as
soon as possible, issue a decision on the permit.
c) "Local entity" means a city, county, city and county,
local agency, joint powers agency, special district, or any
entity of local government that has authority to grant
approvals necessary to implement a pipeline integrity
management plan within the jurisdiction of the local
entity.
5)Specifies that reimbursement to local agencies shall be made
if the Commission on State Mandates determines that this bill
contains costs mandated by the state.
EXISTING LAW :
1)Provides CPUC with regulatory authority over public utilities,
including gas corporations.
2)Designates CPUC as the state authority responsible for
regulating and enforcing intrastate gas pipeline
transportation and pipeline facilities, including the
development, submission, and administration of a state
pipeline safety program certification for natural gas
pipelines.
3)Prohibits a local agency from charging permit and similar fees
in excess of the estimated reasonable costs of providing the
services rendered unless the amounts of the fees are approved
by the electorate.
FISCAL EFFECT : This bill is keyed fiscal and contains a
state-mandated local program.
COMMENTS :
1)At approximately 6:15 pm on September 9, 2010, a portion of
PG&E's natural gas pipeline 132 ruptured and exploded in the
City of San Bruno near Skyline Boulevard, killing seven
residents and injuring numerous others, some of them severely.
The San Bruno explosion resulted in a large fireball which
ultimately destroyed 37 homes.
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As part of its response to the San Bruno tragedy, the CPUC
issued Resolution No. L-403 on September 24, 2010. Among
other things, that resolution established an Independent
Review Panel of experts to gather facts, review those facts
and make recommendations to the CPUC for the safer management
of the state's natural gas systems.
The Independent Review Panel released its final report on June
9, 2011, and subsequently revised that report on June 24,
2011. One of the recommendations to the CPUC in the
Independent Review Panel's report reads as follows: "Request
the California General Assembly enact legislation that would
provide the state's gas utilities with the right to expedited
permitting by counties and municipalities for pipeline
inspection, remediation and replacement work undertaken
pursuant to pipeline integrity management." This was one of
three recommendations made in the report that specifically
addressed the need for new legislation.
AB 2559 fulfills the above recommendation, and is sponsored by
the CPUC.
2)The author states that "AB 2559 provides the state's gas
utilities expedited local permitting for pipeline inspection,
remediation and replacement work undertaken pursuant to
pipeline integrity management. This bill results from a
recommendation by the Independent Review Panel established by
the CPUC in the wake of the San Bruno tragedy. One of the
Panel's recommendations encourages the Legislature to enact
legislation that would provide the state's gas utilities with
the right to expedited permitting by counties and
municipalities for pipeline inspection, remediation and
replacement that results from a utility's pipeline integrity
management plan. These pipeline integrity management plans
are currently required of operators of gas transmission
pipelines in order for the utilities to assess and address
potential problems with their pipelines. The state's main gas
operators have submitted Pipeline Safety Enhancement Plans
that propose a combined 815 miles of pressure testing and 391
miles of pipe replacement for 2012-2014 alone. It is vital
that the state's gas operators have all the tools available to
them so that the safety work can be completed expeditiously
and on schedule. AB 2559 will help facilitate this by
providing gas utilities with expedited permitting by counties
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and municipalities for the operators' pipeline inspection,
remediation and replacement work. Codifying this requirement
of expedited permitting for pipeline integrity management work
will help speed up critical safety work, better ensure public
safety across California and put the public at ease that all
needed maintenance has been completed."
3)According to several gas corporations, there have been
instances where the permitting requirements by local
governments appear to go beyond the work related to pipeline
integrity management, in the form of either high permitting
fees or additional requirements like resurfacing roads well
beyond the area where the work is to be performed. As such,
the bill contains a provision that prohibits a local entity
from imposing permit requirements that exceed the scope of the
proposed pipeline project, unless the additional requirements
specifically relate to the project and are necessary for
public safety.
4)This bill is part of a package of bills sponsored by CPUC in
response to the San Bruno explosion. Other bills include AB
1694 (Fuentes), which would allow CPUC to employ a risk-based
approach in determining the frequency and inspections for
master-metered natural gas and propane systems, and AB 1514
(Lowenthal), which would increase civil penalties for
violations of excavation laws and authorize CPUC to prescribe
rules for public utilities that are conducting subsurface
operations, and provide information to the State Attorney
General or local district attorney on matters involving
excavation violations. AB 1694 is currently pending in the
Assembly Appropriations Committee, and AB 1514 was heard in
the Assembly Utilities and Commerce Committee on April 16,
2012, where it failed passage, but was granted reconsideration
and will be heard again on April 23, 2012.
5)Support arguments : Supporters argue that this bill is key to
ensuring the safety of residents in those cities and counties
in which pipelines are operated and regulated.
Opposition arguments : None on file.
6)This bill was heard in the Utilities and Commerce Committee on
April 9, 2012, and passed on a 13-0 vote.
REGISTERED SUPPORT / OPPOSITION :
AB 2559
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Support
California Public Utilities Commission �SPONSOR]
Pacific Gas & Electric (PG & E)
Sierra Club
Opposition
None on file
Analysis Prepared by : Debbie Michel / L. GOV. / (916)
319-3958