{"operation":"document","citation":"CPF 220130021","title":"AMERIGAS PROPANE LP — Notice of Probable Violation","source_type":"enforcement","agency":"Pipeline and Hazardous Materials Safety Administration","status":"historical","official":true,"published_on":"2013-06-20","effective_on":null,"summary":"CLOSED notice of probable violation citing 192.457, 192.723, 192.739, 192.747.","machine_formats":{"json":"https://regulus.evalyn.ai/document/phmsa-enforcement-220130021.json","markdown":"https://regulus.evalyn.ai/document/phmsa-enforcement-220130021.md"},"app_url":"https://regulus.evalyn.ai/document/phmsa-enforcement-220130021","source_url":"https://primis.phmsa.dot.gov/enforcement-data/case/220130021","body":"Notice of Probable Violation involving AMERIGAS PROPANE LP. PHMSA's enforcement data identifies the cited regulations as 192.457,  192.723,  192.739,  192.747. The case was opened on 2013-06-20 and is reported as closed as of 2014-09-23. Proposed civil penalty: $33,700. Assessed civil penalty: $24,950. Open the official case record for notices, responses, orders, and the latest status.\n\nOfficial case documents:\n\n220130021_closure letter_09232014.pdf: https://primis.phmsa.dot.gov/enforcement-documents/220130021/220130021_closure%20letter_09232014.pdf\n\n220130021_closure Letter_09232014_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/220130021/220130021_closure%20Letter_09232014_text.pdf\n\n220130021_Final Order_06302014.pdf: https://primis.phmsa.dot.gov/enforcement-documents/220130021/220130021_Final%20Order_06302014.pdf\n\n220130021_Final Order_06302014_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/220130021/220130021_Final%20Order_06302014_text.pdf\n\n220130021_NOPV_ PCP_CO_06202013_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/220130021/220130021_NOPV_%20PCP_CO_06202013_text.pdf\n\n220130021_nopv_pcp_pco_06202013.pdf: https://primis.phmsa.dot.gov/enforcement-documents/220130021/220130021_nopv_pcp_pco_06202013.pdf\n\n220130021_Operator Response_07192013.pdf: https://primis.phmsa.dot.gov/enforcement-documents/220130021/220130021_Operator%20Response_07192013.pdf\n\n220130021_Final Order_06302014_text.pdf\n\nJUNE 30, 2014\nMr. Jerry E. Sheridan\nPresident and Chief Executive Officer\nAmeriGas Partners, LP\n460 North Gulph Road\nValley Forge, PA 19482\nRe: CPF No. 2-2013-0021\nDear Mr. Sheridan:\nEnclosed please find the Final Order issued in the above-referenced case. It makes findings of\nviolation, assesses a reduced civil penalty of $24,950, and specifies actions that need to be taken\nby AmeriGas Propane, LP, to comply with the pipeline safety regulations. The penalty payment\nterms are set forth in the Final Order. When the civil penalty has been paid and the terms of the\ncompliance order have been completed, as determined by the Director, Southern Region, this\nenforcement action will be closed. Service of the Final Order by certified mail is deemed\neffective upon the date of mailing, or as otherwise provided under 49 C.F.R. § 190.5.\nThank you for your cooperation in this matter.\nSincerely,\nJeffrey D. Wiese\nAssociate Administrator\nfor Pipeline Safety\nEnclosure\ncc: Mr. Wayne T. Lemoi, Director, Southern Region, OPS\nMs. Linda Daugherty, Deputy Associate Administrator for Field Operations, OPS\nMr. Paul Grady, VP and COO, AmeriGas Propane, LP\nMr. Edward Boden, Safety and Technology Engineer, AmeriGas Propane, LP\nCERTIFIED MAIL - RETURN RECEIPT REQUESTED\n\n\n\nU.S. DEPARTMENT OF TRANSPORTATION\nPIPELINE AND HAZARDOUS MATERIALS SAFETY ADMINISTRATION\nOFFICE OF PIPELINE SAFETY\nWASHINGTON, D.C. 20590\n____________________________________\n)\nIn the Matter of )\n)\nAmeriGas Propane, LP, ) CPF No. 2-2013-0021\n)\nRespondent. )\n____________________________________)\nFINAL ORDER\nOn April 8-12, 2013, pursuant to 49 U.S.C. § 60117, representatives of the Pipeline and\nHazardous Materials Safety Administration (PHMSA), Office of Pipeline Safety (OPS),\nconducted an on-site pipeline safety inspection of the facilities and records of AmeriGas\nPropane, LP (AmeriGas or Respondent), in Broward County, Florida, and Fort Lauderdale,\nFlorida. AmeriGas is a subsidiary of AmeriGas Partners, LP, a publicly traded master limited\npartnership that distributes propane throughout the United States.1\nAs a result of the inspection, the Director, Southern Region, OPS (Director), issued to\nRespondent, by letter dated June 20, 2013, a Notice of Probable Violation, Proposed Civil\nPenalty, and Proposed Compliance Order (Notice), which also included a warning pursuant to\n49 C.F.R. § 190.205. In accordance with 49 C.F.R. § 190.207, the Notice proposed finding that\nAmeriGas had committed various violations of 49 C.F.R. Part 192 and proposed assessing a civil\npenalty of $33,700 for the alleged violations. The Notice also proposed ordering Respondent to\ntake certain measures to correct the alleged violations. The warning items required no further\naction, but warned the operator to correct the probable violations or face future potential\nenforcement action.\nAmeriGas responded to the Notice by letter dated July 19, 2013 (Response). The company\ncontested one of the allegations and offered additional information in response to the Notice.\nRespondent did not request a hearing and therefore has waived its right to one.\nFINDINGS OF VIOLATION\nThe Notice alleged that Respondent violated 49 C.F.R. Part 192, as follows:\nItem 2: The Notice alleged that Respondent violated 49 C.F.R. § 192.723, which states in\nrelevant part:\n1 http://investors.amerigas.com/investor-relations/ir-home/default.aspx (last accessed January 17, 2014).\n\n\n\n2\n§ 192.723 Distribution systems: Leakage surveys.\n(a) Each operator of a distribution system shall conduct periodic\nleakage surveys in accordance with this section.\n(b) The type and scope of the leakage control program must be\ndetermined by the nature of the operations and the local conditions, but it\nmust meet the following minimum requirements:\n(1) . . . .\n(2) A leakage survey with leak detector equipment must be conducted\noutside business districts as frequently as necessary, but at least once\nevery 5 calendar years at intervals not exceeding 63 months. However, for\ncathodically unprotected distribution lines subject to § 192.465(e) on\nwhich electrical surveys for corrosion are impractical, a leakage survey\nmust be conducted at least once every 3 calendar years at intervals not\nexceeding 39 months.\nThe Notice alleged that Respondent violated 49 C.F.R. § 192.723 by failing to conduct a leakage\nsurvey with leak detector equipment as frequently as necessary, but at least once every five\ncalendar years at intervals not exceeding 63 months. Specifically, the Notice alleged that, during\nthe inspection, AmeriGas failed to provide documentation that it conducted a leakage survey of\nthe Pleasant Ridge distribution system in Deerfield Beach, FL from 2007-2012.\nRespondent did not contest this allegation of violation.\nAccordingly, based upon a review of all of the evidence, I find that Respondent violated\n49 C.F.R. § 192.723 by failing to conduct a leakage survey with leak detector equipment as\nfrequently as necessary, but at least once every five calendar years at intervals not exceeding 63\nmonths.\nItem 3: The Notice alleged that Respondent violated 49 C.F.R. § 192.739, which states in\nrelevant part:\n§ 192.739 Pressure limiting and regulating stations: Inspection and\ntesting.\n(a) Each pressure limiting station, relief device (except rupture discs),\nand pressure regulating station and its equipment must be subjected at\nintervals not exceeding 15 months, but at least once each calendar year, to\ninspections and tests to determine that it is–\n(1) In good mechanical condition;\n(2) Adequate from the standpoint of capacity and reliability of\noperation for the service in which it is employed;\n(3) Except as provided in paragraph (b) of this section, set to control or\nrelieve at the correct pressure consistent with the pressure limits of\n§ 192.201(a); and\n(4) Properly installed and protected from dirt, liquids, or other\nconditions that might prevent proper operation.\nThe Notice alleged that Respondent violated 49 C.F.R. § 192.739 by failing to inspect and test\n\n\n\n3\neach pressure regulating station and its equipment at intervals not exceeding 15 months, but at\nleast once each calendar year. Specifically, the Notice alleged that AmeriGas failed to provide\ndocumentation to show it had inspected four LPG distribution systems in calendar year 2012.2\nIn its Response, AmeriGas argued that, while § 192.739 requires testing, NFPA 58/59 simply\nrequires that the regulators cited in the Notice be approved according to ANSI/UL 144, Standard\nfor LP Gas Regulators. Because § 192.11(c) states that “in the event of a conflict between this\npart and ANSI/NFPA 58 and 59 [the latter prevails],” AmeriGas argued that it was not required\nto inspect these regulators.\nThe Merriam-Webster dictionary defines the word “conflict”3 as “a competitive or opposing\naction of incompatibles.” In deciding whether the § 192.739 testing requirement is\n“incompatible” with NFPA 58/59, I have considered whether the regulation and the standard are\nincapable of reconciliation. Since nothing in either text would impede AmeriGas from\ncomplying with both the standard and the regulation at the same time, I find that there is no\nconflict between § 192.739 and NFPA 58/59 regarding the inspection and testing of pressure\nregulating stations.\nIn its defense, AmeriGas cited a PHMSA Final Order that withdrew a similar allegation of\nviolation and regarded a “conflict” between Part 192 and NFPA 58/59 as a circumstance where\nthe former required testing and the latter did not. However, in a more recent case involving\nAmeriGas, PHMSA held that an operator was required to comply with both NFPA 58/59 and\nPart 192 when the operator was capable of complying with both requirements.4 Insofar as the\nRespondent has failed to claim either “impossibility” or “impracticability,” I find that AmeriGas\nwas required to conduct these inspections pursuant to § 192.739.\nAccordingly, after considering all of the evidence, I find that Respondent violated 49 C.F.R.\n§ 192.739 by failing to inspect and test each pressure regulating station and its equipment at\nintervals not exceeding 15 months, but at least once each calendar year.\nThese findings of violation will be considered prior offenses in any subsequent enforcement\naction taken against Respondent.\n2 AmeriGas failed to provide documentation that the following distribution systems were subjected to inspection\nand testing: (1) Brentwood #1 – 8, 11-19; Pleasant Ridge, Deerfield Beach; Madison Apartments, Fort Lauderdale;\nand Sunshine Plaza, Tamarac. Pipeline Safety Violation Report (Violation Report), June 20, 2013 (on file with\nPHMSA), at 11.\n3 http://www merriam-webster.com/dictionary/conflict.\n4 An operator may only claim a conflict between the requirements of NFPA 58 and Part 192 where “the possibility\nof conflict would arise if it were impossible or impracticable to comply with both.” In the Matter of AmeriGas\nPropane, L.P., Final Order C.P.F. No. 3-2006-0004 (April 15, 2009) (available at\nwww.phmsa.dot.gov/pipeline/enforcement).\n\n\n\n4\nASSESSMENT OF PENALTY\nUnder 49 U.S.C. § 60122, Respondent is subject to an administrative civil penalty not to exceed\n$200,000 per violation for each day of the violation, up to a maximum of $2,000,000 for any\nrelated series of violations.5 In determining the amount of a civil penalty under 49 U.S.C.\n§ 60122 and 49 C.F.R. § 190.225, I must consider the following criteria: the nature,\ncircumstances, and gravity of the violation, including adverse impact on the environment; the\ndegree of Respondent’s culpability; the history of Respondent’s prior offenses; and any effect\nthat the penalty may have on its ability to continue doing business; and the good faith of\nRespondent in attempting to comply with the pipeline safety regulations. In addition, I may\nconsider the economic benefit gained from the violation without any reduction because of\nsubsequent damages, and such other matters as justice may require. The Notice proposed a total\ncivil penalty of $33,700 for the violations cited above.\nItem 2: The Notice proposed a civil penalty of $16,200 for Respondent’s violation of 49 C.F.R.\n§ 192.723, for failing to conduct a leakage survey with leak detector equipment as frequently as\nnecessary, but at least once every five calendar years at intervals not exceeding 63 months.\nAmeriGas neither contested the allegation nor presented any evidence or argument justifying a\nmodification of the proposed penalty. Leakage surveys provide invaluable information to\noperators about their systems, and if conducted regularly, can reduce product releases and other\nnegative consequences. Accordingly, having reviewed the record and considered the assessment\ncriteria, I assess Respondent a civil penalty of $16,200 for violation of 49 C.F.R. § 192.723.\nItem 3: The Notice proposed a civil penalty of $17,500 for Respondent’s violation of 49 C.F.R.\n§ 192.739, for failing to inspect and test each pressure regulating station and its equipment at\ncertain intervals. Above, I rejected AmeriGas’ argument that it was not required to conduct these\ninspections. In considering the proposed penalty, the noncompliance affected a number of LPG\ndistribution systems. In addition, Respondent was assessed a penalty for failure to inspect\nregulators on April 16, 2009.6 The Respondent did not contest the violation at the time and\ntherefore I find it dubious that Respondent relied on the 1998 Final Order in making its decision\nthat it was not required to comply with § 192.739. Nevertheless, since the case cited by the\nRespondent is relevant to the situation here, I find that the Respondent had some reasoned basis\nfor failing to comply with the regulation and warrants a penalty reduction. Notwithstanding this\npenalty reduction, the holding of the 1998 Final Order was erroneous when made, and therefore\nshould not be used as a future basis for avoiding compliance with Part 192.\nAccordingly, having reviewed the record and considered the assessment criteria, I assess\nRespondent a reduced civil penalty of $8,750 for violation of 49 C.F.R. § 192.739.\nIn summary, having reviewed the record and considered the assessment criteria for each of the\nItems cited above, I assess Respondent a total civil penalty of $24,950.\n5 The Pipeline Safety, Regulatory Certainty, and Job Creation Act of 2011, Pub. L. No. 112-90, § 2(a)(1), 125 Stat.\n1904, January 3, 2012, increased the civil penalty liability for violating a pipeline safety standard to $200,000 per\nviolation for each day of the violation, up to a maximum of $2,000,000 for any related series of violations.\n6 In the Matter of AmeriGas Propane (AmeriGas), Final Order, C.P.F. No. 3-2006-0004 (Aug. 9, 2009) (available at\nwww.phmsa.dot.gov/pipeline/enforcement).\n\n\n\n5\nPayment of the civil penalty must be made within 20 days of service. Federal regulations\n(49 C.F.R. § 89.21(b)(3)) require such payment to be made by wire transfer through the Federal\nReserve Communications System (Fedwire), to the account of the U.S. Treasury. Detailed\ninstructions are contained in the enclosure. Questions concerning wire transfers should be\ndirected to: Financial Operations Division (AMK-325), Federal Aviation Administration, Mike\nMonroney Aeronautical Center, P.O. Box 269039, Oklahoma City, Oklahoma 73125. The\nFinancial Operations Division telephone number is (405) 954-8845.\nFailure to pay the $24,950 civil penalty will result in accrual of interest at the current annual rate\nin accordance with 31 U.S.C. § 3717, 31 C.F.R. § 901.9 and 49 C.F.R. § 89.23. Pursuant to\nthose same authorities, a late penalty charge of six percent (6%) per annum will be charged if\npayment is not made within 110 days of service. Furthermore, failure to pay the civil penalty\nmay result in referral of the matter to the Attorney General for appropriate action in a district\ncourt of the United States.\nCOMPLIANCE ORDER\nThe Notice proposed a compliance order with respect to Items 2 and 3 in the Notice for\nviolations of 49 C.F.R. §§ 192.723 and 192.739, respectively. Under 49 U.S.C. § 60118(a), each\nperson who engages in the transportation of gas or who owns or operates a pipeline facility is\nrequired to comply with the applicable safety standards established under chapter 601. Pursuant\nto the authority of 49 U.S.C. § 60118(b) and 49 C.F.R. § 190.217, Respondent is ordered to take\nthe following actions to ensure compliance with the pipeline safety regulations applicable to its\noperations:\n1. With respect to the violation of § 192.723 (Item 2), Respondent must conduct a\nleakage survey with leak detector equipment of its Pleasant Ridge LPG distribution\nsystem in Deerfield Beach, FL, and prepare records to document the leakage survey\nwithin 90 days after receipt of this Final Order.\n2. With respect to the violation of § 192.739 (Item 3), Respondent must inspect and\ntest each pressure limiting station, relief device (except rupture discs), and pressure\nregulating station and its equipment in accordance with § 192.739, and prepare\nrecords to document the tests and inspections within 90 days after receipt of this Final\nOrder.\n3. PHMSA requests that AmeriGas maintain documentation of the safety\nimprovement costs associated with fulfilling this Compliance Order and submit the\ntotal to the Director, Southern Region. The costs should be reported in two\ncategories: (1) total costs associated with preparation and revision of plans,\nprocedures, studies, and analyses; and (2) total cost associated with replacements,\nadditions, and other changes to the pipeline infrastructure.\nThe Director may grant an extension of time to comply with any of the required items upon a\nwritten request timely submitted by the Respondent and demonstrating good cause for an\nextension.\n\n\n\n6\nFailure to comply with this Order may result in the administrative assessment of civil penalties\nnot to exceed $200,000 for each violation for each day the violation continues or in referral to the\nAttorney General for appropriate relief in a district court of the United States.\nWARNING ITEMS\nWith respect to Items 1 and 4, the Notice alleged probable violations of Part 192 but did not\npropose a civil penalty or compliance order for these items. Therefore, these are considered to\nbe warning items. The warnings were for:\n49 C.F.R. § 192.457 (Item 1) ─ Respondent’s alleged failure to provide records\nto demonstrate that approximately two miles of 0.75-1 inch diameter coated steel\npipeline was cathodically protected or that these lines had no areas of active\ncorrosion; and\n49 C.F.R. § 192.747 (Item 4) ─ Respondent’s alleged failure to document that it\nchecked and serviced each valve which might be necessary for the safe operation\nof its distribution system, at intervals not exceeding 15 months but at least once\neach calendar year.\nAmeriGas presented information in its Response showing that it had taken certain actions to\naddress the cited items. If OPS finds a violation of any of these items in a subsequent inspection,\nRespondent may be subject to future enforcement action.\nUnder 49 C.F.R. § 190.215, Respondent has a right to submit a Petition for Reconsideration of\nthis Final Order. The petition must be sent to: Associate Administrator, Office of Pipeline\nSafety, PHMSA, 1200 New Jersey Avenue, SE, East Building, 2nd Floor, Washington, DC\n20590, with a copy sent to the Office of Chief Counsel, PHMSA, at the same address. PHMSA\nwill accept petitions received no later than 20 days after receipt of service of this Final Order by\nthe Respondent, provided they contain a brief statement of the issue(s) and meet all other\nrequirements of 49 C.F.R. § 190.215. The filing of a petition automatically stays the payment of\nany civil penalty assessed. Unless the Associate Administrator, upon request, grants a stay, all\nother terms and conditions of this Final Order are effective upon service in accordance with\n49 C.F.R. § 190.5.\n___________________________________ __________________________\nJeffrey D. Wiese Date Issued\nAssociate Administrator\nfor Pipeline Safety\n\n220130021_closure Letter_09232014_text.pdf\n\nCERTIFIED MAIL - RETURN RECEIPT REQUESTED\nSeptember 23, 2014\nMr. Jerry E. Sheridan\nPresident and Chief Operating Officer\nAmeriGas Propane, LP\n460 North Gulph Road\nValley Forge, PA 19482\nCPF 2-2013-0021\nDear Mr. Sheridan:\nOn June 30, 2014, the Pipeline and Hazardous Materials Safety Administration (PHMSA),\nOffice of Pipeline Safety (OPS) issued AmeriGas Propane, LP (AmeriGas) a Final Order with\nan attached Compliance Order (CO) in the above-referenced case. The CO required AmeriGas\nto undertake certain actions to ensure compliance with the federal pipeline safety regulations.\nThe OPS Southern Region received and reviewed AmeriGas’ responses to the CO dated\nSeptember 3, 2014, and September 16, 2014. Based on our review of the actions taken by\nAmeriGas and the supporting documentation we have determined that AmeriGas has\ncomplied with the terms of the CO and the Final Order.\nThis case is now closed and no further action is necessary with respect to the matters involved\nin this case.\nPlease be advised that this letter refers only to the above referenced order (CPF 2-2013-0021)\nand not to any other PHMSA cases, if any.\nSincerely,\nWayne T. Lemoi\nDirector, Office of Pipeline Safety\nPHMSA Southern Region","truncated":false,"body_characters":20726}