{"operation":"document","citation":"CPF 320105009","title":"COUNTRYMARK REFINING AND LOGISTICS, LLC — Notice of Probable Violation","source_type":"enforcement","agency":"Pipeline and Hazardous Materials Safety Administration","status":"historical","official":true,"published_on":"2010-08-12","effective_on":null,"summary":"CLOSED notice of probable violation citing 195.442(a), 199.105(b), 199.225(a).","machine_formats":{"json":"https://regulus.evalyn.ai/document/phmsa-enforcement-320105009.json","markdown":"https://regulus.evalyn.ai/document/phmsa-enforcement-320105009.md"},"app_url":"https://regulus.evalyn.ai/document/phmsa-enforcement-320105009","source_url":"https://primis.phmsa.dot.gov/enforcement-data/case/320105009","body":"Notice of Probable Violation involving COUNTRYMARK REFINING AND LOGISTICS, LLC. PHMSA's enforcement data identifies the cited regulations as 195.442(a),  199.105(b),  199.225(a). The case was opened on 2010-08-12 and is reported as closed as of 2012-12-05. Proposed civil penalty: $180,800. Assessed civil penalty: $180,800. Open the official case record for notices, responses, orders, and the latest status.\n\nOfficial case documents:\n\n320105009_Final Order_11192012.pdf: https://primis.phmsa.dot.gov/enforcement-documents/320105009/320105009_Final%20Order_11192012.pdf\n\n320105009_Final Order_11192012_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/320105009/320105009_Final%20Order_11192012_text.pdf\n\n320105009_NOPV PCP_08122010.pdf: https://primis.phmsa.dot.gov/enforcement-documents/320105009/320105009_NOPV%20PCP_08122010.pdf\n\n320105009_NOPV PCP_08122010_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/320105009/320105009_NOPV%20PCP_08122010_text.pdf\n\n320105009_Operator_Response_and_Request_for_Hearing_09092010.pdf: https://primis.phmsa.dot.gov/enforcement-documents/320105009/320105009_Operator_Response_and_Request_for_Hearing_09092010.pdf\n\n320105009_Final Order_11192012_text.pdf\n\nNOVEMBER 19, 2012\nMr. Charlie Smith\nChief Executive Officer\nCountryMark Cooperative, LLP\n225 South East Street, Suite 144\nIndianapolis, IN 46202\nRe: CPF No. 3-2010-5009\nDear Mr. Smith:\nEnclosed please find the Final Order issued in the above-referenced case. It makes findings of\nviolation and assesses a civil penalty of $180,800. The penalty payment terms are set forth in the\nFinal Order. This enforcement action closes automatically upon receipt of payment. Service of\nthe Final Order by certified mail is deemed effective upon the date of mailing, or as otherwise\nprovided 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. David Barrett, Director, Central Region, OPS\nMr. Alan Mayberry, Deputy Associate Administrator for Field Operations, OPS\nMr. Richard Streeter, Counsel for CountryMark Cooperative, LLP\nMr. Pat Ward, Vice President of Operations, CountryMark Cooperative, LLP\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)\nCountryMark Cooperative, LLP, ) CPF No. 3-2010-5009\n)\nRespondent. )\n____________________________________)\nFINAL ORDER\nBeginning November 7, 2009, pursuant to 49 U.S.C. § 60117, a representative of the Pipeline\nand Hazardous Materials Safety Administration (PHMSA), Office of Pipeline Safety (OPS),\nconducted an investigation of an accident involving the pipeline system operated by\nCountryMark Cooperative, LLP (CountryMark or Respondent), in Mt. Vernon, Indiana. The\nsystem consists of 229 miles of pipeline that transports refined product from a refinery in Mt.\nVernon, Indiana, to terminals in Switz City, Jolietville, and Peru, Indiana, including\napproximately 162 miles of pipeline that could affect High Consequence Areas (HCAs).\n1 The\ninvestigation arose out of an accident which occurred when a third party struck the pipeline on\nNovember 6, 2009. As a result of the accident, approximately 200 barrels of diesel fuel were\nspilled in an HCA.\nAs a result of the investigation, the Director, Central Region, OPS (Director), issued to\nRespondent, by letter dated August 12, 2010, a Notice of Probable Violation and Proposed Civil\nPenalty (Notice). In accordance with 49 C.F.R. § 190.207, the Notice proposed finding that\nCountryMark had violated 49 C.F.R. §§ 195.442(a), 199.105(b), and 199.225(a), and proposed\nassessing a civil penalty of $180,800 for the alleged violations.\nCountryMark responded to the Notice (Response) and submitted a statement of issues and\nrequest for hearing (Statement of Issues) by letters dated September 9, 2010. CountryMark\ncontested two of the allegations. A hearing was subsequently held on March 17, 2011, in Kansas\nCity, Missouri, with an attorney from the Office of Chief Counsel, PHMSA, presiding. At the\nhearing, Respondent was represented by counsel. After the hearing, Respondent provided\nadditional written material for the record, by letter dated April 4, 2011 (Closing).\n1 49 C.F.R. § 195.452.\n\n\n\n2\nFINDINGS OF VIOLATION\nThe Notice alleged that Respondent violated 49 C.F.R. Parts 195 and 199, as follows:\nItem 1: The Notice alleged that Respondent violated 49 C.F.R. § 195.442(a), which states:\n§ 195.442 Damage prevention program.\n(a) Except as provided in paragraph (d) of this section, each operator\nof a buried pipeline must carry out, in accordance with this section, a\nwritten program to prevent damage to that pipeline from excavation\nactivities. For the purpose of this section, the term “excavation activities”\nincludes excavation, blasting, boring, tunneling, backfilling, the removal\nof aboveground structures by either explosive or mechanical means, and\nother earthmoving operations.\nThe Notice alleged that Respondent violated 49 C.F.R. § 195.442(a) by failing to carry out its\nwritten program to prevent damage to its pipeline from excavation activities. Specifically, the\nNotice alleged that CountryMark failed to carry out its written program by failing to adequately\nmark the pipeline prior to commencement of excavation activity by a tiling contractor.\nRespondent did not contest this allegation of violation.2\nAccordingly, based upon a review of all of the evidence, I find that Respondent violated\n49 C.F.R. § 195.442(a) by failing to carry out its written program to prevent damage to its\npipeline from excavation activities.\nItem 2: The Notice alleged that Respondent violated 49 C.F.R. § 199.105(b), which states:\n§ 199.105 Drug tests required.\nEach operator shall conduct the following drug tests for the presence\nof a prohibited drug:\n(a) …\n(b) Post-accident testing. As soon as possible but no later than 32\nhours after an accident, an operator shall drug test each employee whose\nperformance either contributed to the accident or cannot be completely\ndiscounted as a contributing factor to the accident. An operator may\ndecide not to test under this paragraph but such a decision must be based\non the best information available immediately after the accident that the\nemployee's performance could not have contributed to the accident or that,\nbecause of the time between that performance and the accident, it is not\nlikely that a drug test would reveal whether the performance was affected\nby drug use.\nThe Notice alleged that Respondent violated 49 C.F.R. § 199.105(b) by failing to perform post-\naccident drug testing of each employee whose performance could not be completely discounted\n2 While Respondent did not contest this allegation of violation, the company did note that “no CountryMark\nemployee authorized the third-party to begin excavation activities.” Statement of Issues at 1.\n\n\n\n3\nas a contributing factor to the accident as soon as possible but no later than 32 hours after the\naccident. Specifically, the Notice alleged that CountryMark failed to perform post-accident drug\ntests on two employees meeting these criteria, the line locator and an employee who was\nassisting him. It further alleged that CountryMark did not have sufficient information\nimmediately after the accident to determine that employee performance could not have\ncontributed to the accident.\nThe circumstances surrounding the accident are undisputed. On November 5, 2009,\nCountryMark received a pipeline location request so that a third party, Southern Indiana\nDrainage, Inc., (SID) could perform excavation activities near the pipeline the following day.\nOn November 6, CountryMark sent one of its employees, Mr. Donald Ray Goodson, to the site\nto perform the line location. He placed flags along the route where he thought the pipeline was\nburied, but was unable to confirm the location of the pipeline by probing the ground along the\nputative route.\nCountryMark then sent a second employee, Mr. Derek Almon, to assist Goodson. Almon began\nprobing for the pipeline along the route that Goodson had marked while Goodson continued\nusing the line-detection equipment. Approximately 30 minutes after Almon arrived at the site,\nthe SID crew’s trenching machine struck the pipeline, which began to release product. Goodson\nand Almon notified CountryMark’s control room and supervisors, and the company began\nefforts to mitigate the effects of the accident. CountryMark closed nearby block valves and sent\nadditional employees, including managers, to the site. The company realized soon thereafter that\nGoodson had marked a route approximately 200 feet north of the actual location of the pipeline.\nGoodson and Almon were not tested for drugs until November 9, at which time the test results\nwere negative.\nIn its Response and at the hearing, CountryMark did not contest the allegation as related to\nGoodson, the line locator, but did contest it as related to Almon. Respondent argued that\nAlmon’s activities had nothing to do with the accident and that the company’s managers had\ndetermined that Almon’s performance had not contributed to the accident. CountryMark\nasserted that soon after the accident, its managers determined that Goodson was “solely\nresponsible” for the erroneous marking which led to the accident, and that therefore Almon was\nnot required to be tested for drugs.3 In addition, the company argued that because the erroneous\nmarking of the pipeline was the cause of the accident, and Almon arrived at the site after the\nerroneous marking had been made, the company could rationally conclude that Almon’s\nactivities could not have been a contributing factor to the accident.4\nI do not find these arguments convincing. Almon was sent to the site to assist the line locator in\nhis activities; his task was to probe for the pipeline along the route that Goodson had marked, to\nconfirm that the pipeline had been accurately marked. The pipeline had not been accurately\nmarked, however. If Almon had notified the excavator or CountryMark management that he had\nnot found the pipeline along the marked route, it’s possible the accident would not have\noccurred. Therefore it is impossible to completely discount Almon’s activities from being a\n3 Closing at 3.\n4 Closing at 9.\n\n\n\n4\ncontributing factor to the accident, and there was no evidence available immediately after the\naccident to support such a conclusion.\nWhile the act of probing did not cause the accident, probing for the pipeline did serve a function\nin the task of locating the pipeline. Probing is a common and appropriate practice to verify the\nactual location and depth of an underground pipeline before excavation activity begins. Almon’s\nability to probe for and confirm the location of the underground pipeline and to draw appropriate\nconclusions from his inability to confirm the location of the pipeline could have been impaired if\nhe were under the influence of drugs.\nThe regulation authorizes the company to dispense with testing if, based on the best information\navailable immediately after the accident, it determines that the employee's performance could not\nhave contributed to the accident. In its Closing, CountryMark asserted that “the decision not to\nrequire Almon to submit to testing was based on readily ascertainable facts and information that\nwere discovered within a matter of minutes following the accident.”5 A similar statement\nappears in the affidavit of George Morgan, which was submitted as an attachment to the\nClosing.6 However, this assertion is not consistent with statements made by CountryMark\npersonnel at the hearing. At the hearing, CountryMark’s managers indicated that because there\nwas no nexus linking Almon’s activities on site to the accident, they did not test him for drugs\nbecause the idea that his performance could have contributed to the accident simply never\noccurred to them. They did not claim to have made a reasoned analysis as to whether his\nperformance could be completely discounted as a contributing factor to the accident.\nFurthermore, CountryMark submitted no documentation of the decision-making process by\nwhich the company decided not to require either Goodson or Almon to be tested for drugs\nimmediately after the accident. CountryMark readily admitted that Goodson’s performance was\nthe primary cause of the accident7 but the record shows that he was not tested for drugs\nimmediately after the accident either. The company stated that the decision not to test Goodson\nwas based upon his previous work history and the company’s familiarity with his behavior.8\nHowever, there is no documented evidence for this conclusion. The fact that Goodson was not\ntested undercuts the company’s claim that the decision not to test Almon was a conscious\ndecision based on the best available evidence. Instead, it suggests that the company did not\nconsider drug testing for any employees in the hours following the accident. Almon and\nGoodson were finally tested for drugs on November 9, 2009, three days after the accident and\nafter OPS staff had reminded CountryMark of the regulatory requirement.9\nCountryMark argued that because Almon was not qualified to perform line locator functions, he\nhad no responsibility to mark the pipeline or to communicate with the third-party excavator\n5 Closing at 7.\n6 Id., Attachment 2, at paragraph 7.\n7 Id. at 5, 6, 8, 10, 11, and 14.\n8 Id. at 13; Response at 7.\n9 Closing, Attachment 2, at paragraph 8.\n\n\n\n5\nabout the location of the pipeline.10 Because he had no such responsibility, Almon could be\ncompletely discounted as a contributing factor to the accident.\nThis argument is not relevant. The regulation requires drug testing of those employees who\nperform a “covered function,” which is defined as “an operations, maintenance, or emergency-\nresponse function regulated by Part 192, 193 or 195 of this chapter….”11 The definition of a\ncovered function in Part 199 for purposes of drug testing is broader than the definition in Part\n195 of a “covered task” for purposes of operator qualification of pipeline personnel.12 Almon\nwas not qualified by the operator to perform the line location task, but he was performing an\noperations and maintenance function regulated by Part 195 as part of the company’s damage\nprevention program.13 Therefore, for purposes of Part 199, Almon was performing a covered\nfunction.\nIt is apparent from the record that because CountryMark promptly pinpointed what it considered\nto be the cause of the accident and saw no obvious reason to suspect drug use by either of the\ntwo employees involved in locating the pipeline, the company saw no need to drug test either\none. But the drug and alcohol testing requirements found in Part 199 are deliberately designed to\ncast a wide net by requiring testing of persons whose contributing role in an accident might not\nbe readily apparent. This is why § 199.105(b) requires drug testing of any person whose\nperformance of a covered function cannot be “completely” discounted as a contributing factor.\nIn summary, I find that Almon’s activities on the day of the accident could not have been\ncompletely discounted by CountryMark from being a contributing factor to the accident and that\nthere was no evidence available immediately after the accident that could have led the company\nto draw such a conclusion. Therefore, the drug testing requirement applied to Almon.\nAccordingly, after considering all of the evidence and the legal issues presented, I find that\nRespondent violated 49 C.F.R. § § 199.105(b) by failing to perform post-accident drug testing of\ntwo employees whose performance could not be completely discounted as a contributing factor\nto the accident, as soon as possible but no later than 32 hours after the accident.\nItem 3: The Notice alleged that Respondent violated 49 C.F.R. § 199.225(a), which states:\n§ 199.225 Alcohol tests required.\nEach operator shall conduct the following types of alcohol tests for the\npresence of alcohol:\n(a) Post-accident. (1) As soon as practicable following an accident,\neach operator shall test each surviving covered employee for alcohol if\nthat employee's performance of a covered function either contributed to\nthe accident or cannot be completely discounted as a contributing factor to\nthe accident. The decision not to administer a test under this section shall\n10 Id. at 2.\n11 49 C.F.R. § 199.100. 49 C.F.R. § 199.3.\n12 49 C.F.R. § 195.501.\n13 49 C.F.R. § 195.442.\n\n\n\n6\nbe based on the operator's determination, using the best available\ninformation at the time of the determination, that the covered employee's\nperformance could not have contributed to the accident.\nThe Notice alleged that Respondent violated 49 C.F.R. § 199.225(a) by failing to test for alcohol\nas soon as practicable following the accident each surviving covered employee whose\nperformance of a covered function could not be completely discounted as a contributing factor to\nthe accident. Specifically, the Notice alleged that CountryMark failed to perform post-accident\nalcohol tests on two employees meeting these criteria.\nIn its Response and at the hearing, CountryMark contested this allegation as it related to Almon\nbut not as it related to Goodson. CountryMark’s defenses to this alleged violation were the same\nas those for Item 2, relating to post-accident drug testing. For the reasons discussed above, I do\nnot find these defenses convincing.\nCountryMark raised an additional defense in its Response and at the hearing, stating that “it was\nnot practicable in the absence of any indication of alcoholic consumption to test Almon after the\naccident.”14 CountryMark went on to explain that immediately following the accident, Almon\nattempted to close the nearest block valve to stem the flow of product, and then began the\nrecovery of the diesel fuel that had spilled from the damaged pipe and continued this task until\n1:30 am the next morning.\nI do not find this argument convincing. CountryMark provided no evidence to demonstrate that\nAlmon was critical to the recovery effort or that other employees were not available to perform\nthese tasks. Indeed, had Almon’s performance prior to the accident been affected by alcohol, his\nefforts to mitigate the damage from the spill could have been hampered. The regulation provides\nonly one way to ascertain whether this was the case and that was through alcohol testing, to be\nperformed “[a]s soon as practicable following an accident.” The requirement makes no\nallowances for delay in the absence of indications of alcoholic consumption.\nAccordingly, after considering all of the evidence, I find that Respondent violated\n49 C.F.R. § 199.225(a) by failing to test for alcohol, as soon as practicable following the\naccident, two surviving covered employees whose performance of a covered function could not\nbe completely discounted as a contributing factor to the accident.\nThese findings of violation will be considered prior offenses in any subsequent enforcement\naction taken against Respondent.\nASSESSMENT OF PENALTY\nUnder 49 U.S.C. § 60122, Respondent is subject to an administrative civil penalty not to exceed\n$100,000 per violation for each day of the violation, up to a maximum of $1,000,000 for any\nrelated series of violations. In determining the amount of a civil penalty under\n49 U.S.C. § 60122 and 49 C.F.R. § 190.225, I must consider the following criteria: the nature,\n14 Response at 8.\n\n\n\n7\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; the Respondent’s\nability to pay the penalty and any effect that the penalty may have on its ability to continue doing\nbusiness; and the good faith of Respondent in attempting to comply with the pipeline safety\nregulations. In addition, I may consider the economic benefit gained from the violation without\nany reduction because of subsequent damages, and such other matters as justice may require.\nThe Notice proposed a total civil penalty of $180,800 for the violations cited above.\nItem 1: The Notice proposed a civil penalty of $100,000 for Respondent’s violation of\n49 C.F.R. § 195.442(a), for failing to carry out its written program to prevent damage to its\npipeline from excavation activities. Respondent neither contested the allegation nor presented\nany evidence or argument justifying a reduction in the proposed penalty. This violation directly\nled to the pipeline accident, which resulted in 200 barrels of diesel fuel being spilled in an HCA.\nI find that the nature, circumstances, and gravity of the violation warrant the proposed penalty.\nAccordingly, having reviewed the record and considered the assessment criteria, I assess\nRespondent a civil penalty of $100,000 for violation of 49 C.F.R. § 195.442(a).\nItem 2: The Notice proposed a civil penalty of $40,400 for Respondent’s violation of\n49 C.F.R. § 199.105(b), for failing to perform post-accident drug testing of two employees\nwhose performance could not be completely discounted as a contributing factor to the accident,\nas soon as possible but no later than 32 hours after the accident. As discussed above, I found that\nthe drug-testing requirement applied to both employees that Respondent failed to test for drugs.\nRespondent’s only argument for mitigation of the proposed penalty was the same as the defense\ndiscussed in the Findings section above. Considering Respondent’s culpability and the nature,\ncircumstances, and gravity of the violation, I find that the proposed penalty is warranted.\nAccordingly, having reviewed the record and considered the assessment criteria, I assess\nRespondent a civil penalty of $40,400 for violation of 49 C.F.R. § 199.105(b).\nItem 3: The Notice proposed a civil penalty of $40,400 for Respondent’s violation of\n49 C.F.R. § 199.225(a), for failing to test for alcohol as soon as practicable following the\naccident two surviving covered employees whose performance of a covered function could not\nbe completely discounted as a contributing factor to the accident. I found that the alcohol testing\nrequirement applied to both employees whom Respondent failed to test for alcohol.\nRespondent’s only argument for mitigation of the proposed penalty was the same as the defense\ndiscussed in the Findings section above. Considering Respondent’s culpability and the nature,\ncircumstances, and gravity of the violation, I find that the proposed penalty is warranted.\nAccordingly, having reviewed the record and considered the assessment criteria, I assess\nRespondent a civil penalty of $40,400 for violation of 49 C.F.R. § 199.225(a).\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 (AMZ-341), Federal Aviation Administration, Mike\nMonroney Aeronautical Center, P.O. Box 269039, Oklahoma City, Oklahoma 73125. The\nFinancial Operations Division telephone number is (405) 954-8893.\n\n\n\n8\nFailure to pay the $180,800 civil penalty will result in accrual of interest at the current annual\nrate in 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.\nUnder 49 C.F.R. § 190.215, Respondent has the 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 the 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 but does not stay any other provisions of the Final Order, including\nany required corrective actions. If Respondent submits payment of the civil penalty, the Final\nOrder becomes the final administrative decision and the right to petition for reconsideration is\nwaived.\nThe 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","truncated":false,"body_characters":25076}