{"operation":"document","citation":"CPF 320175006","title":"ST LOUIS PIPELINE OPERATING LLC — Notice of Probable Violation","source_type":"enforcement","agency":"Pipeline and Hazardous Materials Safety Administration","status":"historical","official":true,"published_on":"2017-07-27","effective_on":null,"summary":"CLOSED notice of probable violation citing 195.432(b).","machine_formats":{"json":"https://regulus.evalyn.ai/document/phmsa-enforcement-320175006.json","markdown":"https://regulus.evalyn.ai/document/phmsa-enforcement-320175006.md"},"app_url":"https://regulus.evalyn.ai/document/phmsa-enforcement-320175006","source_url":"https://primis.phmsa.dot.gov/enforcement-data/case/320175006","body":"Notice of Probable Violation involving ST LOUIS PIPELINE OPERATING LLC. PHMSA's enforcement data identifies the cited regulation as 195.432(b). The case was opened on 2017-07-27 and is reported as closed as of 2018-07-30. Proposed civil penalty: $35,500. Assessed civil penalty: $35,500. Open the official case record for notices, responses, orders, and the latest status.\n\nOfficial case documents:\n\n320175006_Final Order_05012018.pdf: https://primis.phmsa.dot.gov/enforcement-documents/320175006/320175006_Final%20Order_05012018.pdf\n\n320175006_Final Order_05012018_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/320175006/320175006_Final%20Order_05012018_text.pdf\n\n320175006_NOPV PCP_07272017.pdf: https://primis.phmsa.dot.gov/enforcement-documents/320175006/320175006_NOPV%20PCP_07272017.pdf\n\n320175006_NOPV PCP_07272017_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/320175006/320175006_NOPV%20PCP_07272017_text.pdf\n\n320175006_Operator Response to Notice_08262017.pdf: https://primis.phmsa.dot.gov/enforcement-documents/320175006/320175006_Operator%20Response%20to%20Notice_08262017.pdf\n\n320175006_Final Order_05012018_text.pdf\n\nMay 1, 2018\nMr. Robert L. Rose\nPresident and Managing Member\nSt. Louis Pipeline Operating, LLC\nP.O. Box 35236\nSarasota, FL 34242-0303\nRe: CPF No. 3-2017-5006\nDear Mr. Rose:\nEnclosed please find the Final Order issued in the above-referenced case. It makes one finding\nof violation and assesses a civil penalty of $35,500. The penalty payment terms are set forth in\nthe Final Order. This enforcement action closes automatically upon receipt of payment. Service\nof the Final Order by certified mail is effective upon the date of mailing as provided under\n49 C.F.R. § 190.5.\nThank you for your cooperation in this matter.\nSincerely,\nAlan K. Mayberry\nAssociate Administrator\nfor Pipeline Safety\nEnclosure\ncc: Mr. Allan Beshore, Director, Central Region, Office of Pipeline Safety, PHMSA\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____________________________________\nIn the Matter of )\nSt. Louis Pipeline Operating, LLC, ) CPF No. 3-2017-5006\n)\n)\n)\nRespondent. )\n____________________________________)\nFINAL ORDER\nFrom December 8 through December 12, 2014, pursuant to 49 U.S.C. § 60117, a representative\nof the Pipeline and Hazardous Materials Safety Administration (PHMSA), Office of Pipeline\nSafety (OPS), conducted an on-site pipeline safety inspection of the facilities and records of St.\nLouis Pipeline Operating, LLC (SLPO or Respondent), in Hartford, IL. SLPO is one of\napproximately seven entities controlled by Tampa Pipeline Corporation (TPC), which operates\npetroleum pipelines throughout the United States.1 TPC, through SLPO, operates a 22-mile\npipeline that supplies Jet-A aviation turbine fuel to Lambert International Airport in St. Louis.\nAs a result of the inspection, the Director, Central Region, OPS (Director), issued to Respondent,\nby letter dated July 27, 2017, a Notice of Probable Violation and Proposed Civil Penalty\n(Notice). In accordance with 49 C.F.R. § 190.207, the Notice proposed finding that SLPO had\nviolated 49 C.F.R. § 195.432 and proposed assessing a civil penalty of $35,500 for the alleged\nviolation.\nRespondent responded to the Notice by letter dated August 28, 2017 (Response). The company\ndid not contest the allegation of violation but provided an explanation of its actions and\nrequested that the proposed civil penalty be reduced, based on an inability to pay. The\ncompany’s request for mitigation of the proposed penalty will be addressed in the “Assessment\nof Penalty” section below. Respondent did not request a hearing and therefore has waived its\nright to one.\nFINDING OF VIOLATION\nIn its Response, SLPO did not contest the allegation in the Notice that it violated 49 C.F.R.\nPart 195, as follows:\n1 SLPO is one of several affiliates of Allied Aviation Services, Inc. See website, available at\nhttp://www.alliedaviation.com/locations/PIPELINE/pipeline.html (last accessed March 8, 2018).\n\n\n\nCPF No. 3-2017-5006\nPage 2\nItem 1: The Notice alleged that Respondent violated 49 C.F.R. § 195.432(b), which states:\n§ 195.432 Inspection of in-service breakout tanks.\n(a) . . . .\n(b) Each operator must inspect the physical integrity of in-service\natmospheric and low-pressure steel above-ground breakout tanks according\nto [American Petroleum Institute (API)] Std 653 (except section 6.4.3,\nAlternative Internal Inspection Interval) (incorporated by reference, see §\n195.3). However, if structural conditions prevent access to the tank bottom,\nits integrity may be assessed according to a plan included in the operations\nand maintenance manual under § 195.402(c)(3). The risk-based internal\ninspection procedures in API Std 653, section 6.4.3 cannot be used to\ndetermine the internal inspection interval.\nAPI Standard 653 provides, in relevant part:\n6.4.2 Inspection Intervals\n6.4.2.2 When corrosion rates are not known and similar service\nexperience is not available to estimate the bottom plate minimum thickness\nat the next inspection, the internal inspection interval shall not exceed 10\nyears.\nThe Notice alleged that Respondent violated 49 C.F.R. § 195.432(b) by failing to inspect two\nbreakout tanks at the company’s Hartford terminal within the 10-year interval specified in\n§ 195.432(b) and API Std 653. Specifically, the Notice alleged that SLPO failed to conduct\ninternal inspections of the two breakout tanks, which were constructed in 2002, by 2012. SLPO\ndid not inspect the tanks until 2015, after PHMSA discovered the violation.\nRespondent did not contest this allegation of violation. Accordingly, based upon a review of all\nof the evidence, I find that Respondent violated 49 C.F.R. § 195.432(b) by failing to inspect two\nbreakout tanks within the 10-year interval specified in § 195.432(b) and API Std 653.\nThis finding of violation will be considered a prior offense in any subsequent enforcement action\ntaken against Respondent.\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.2\n2 These amounts are adjusted annually for inflation. See, e.g., Pipeline Safety: Inflation Adjustment of Maximum\nCivil Penalties, 82 Fed. Reg. 19325 (April 27, 2017).\n\n\n\nCPF No. 3-2017-5006\nPage 3\nIn determining the amount of a civil penalty under 49 U.S.C. § 60122 and 49 C.F.R. § 190.225, I\nmust consider the following criteria: the nature, circumstances, and gravity of the violation,\nincluding adverse impact on the environment; the degree of Respondent’s culpability; the history\nof Respondent’s prior offenses; and any effect that the penalty may have on its ability to continue\ndoing business; and the good faith of Respondent in attempting to comply with the pipeline\nsafety regulations. In addition, I may consider the economic benefit gained from the violation\nwithout any reduction because of subsequent damages, and such other matters as justice may\nrequire. The Notice proposed a total civil penalty of $35,500 for the violation cited above.\nItem 1: The Notice proposed a civil penalty of $35,500 for Respondent’s violation of 49 C.F.R.\n§ 195.432(b), for failing to inspect two breakout tanks within the 10-year interval specified in\nAPI Std 653. Respondent did not contest the allegation, but sought a reduction of the proposed\npenalty based upon financial hardship. According to the company’s president, SLPO had\nsuffered operating losses from December 2012 through December 2016. The company,\nhowever, did not offer or provide certified financial statements or other documentation\nsupporting its claim and upon which PHMSA could accurately determine Respondent’s ability to\npay. Therefore, PHMSA’s Office of Chief Counsel requested additional information regarding\nSLPO’s claim of financial hardship by letter dated December 7, 2017 (RFI), via certified mail.\nThe RFI was delivered to Respondent on December 11, 2017.3\nTo date, Respondent has failed to respond to the RFI or to provide any evidence of a financial\nhardship or SLPO’s inability to pay the proposed civil penalty or the effect of the proposed\npenalty on the company’s ability to continue in business. For a company to demonstrate\nfinancial hardship, it must provide PHMSA with certified financial statements or similar\nevidence by which the agency may accurately determine the company's ability to pay.4\nAccordingly, having reviewed the record and considered the assessment criteria, I assess\nRespondent a civil penalty of $35,500 for violation of 49 C.F.R. § 195.432(b).\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, 6500 S MacArthur Blvd, Oklahoma City, Oklahoma 79169.\nThe Financial Operations Division telephone number is (405) 954-8845.\nFailure to pay the $35,500 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\n3 U.S. Postal Service certified mail return receipt (on file with PHMSA).\n4 In the Matter of Jayhawk Pipeline, LLC, CPF No. 3-2008-5006, 2010 WL 5761106 (Dec. 16, 2010). See also In\nthe Matter of Tampa Bay Pipeline Corp., CPF No. 2-2005-6012, 2008 WL 902910 (Mar. 31, 2008).\n\n\n\nCPF No. 3-2017-5006\nPage 4\ncourt of the United States.\nUnder 49 C.F.R. § 190.243, Respondent may submit a Petition for Reconsideration of this Final\nOrder to the Associate Administrator, Office of Pipeline Safety, PHMSA, 1200 New Jersey\nAvenue, SE, East Building, 2nd Floor, Washington, DC 20590, with a copy sent to the Office of\nChief Counsel, PHMSA, at the same address, no later than 20 days after receipt of service of the\nFinal Order by Respondent. Any petition submitted must contain a brief statement of the issue(s)\nand meet all other requirements of 49 C.F.R. § 190.243. The filing of a petition automatically\nstays the payment of any civil penalty assessed. The other terms of the order, including any\ncorrective action, remain in effect unless the Associate Administrator, upon request, grants a\nstay. If Respondent submits payment of the civil penalty, the Final Order becomes the final\nadministrative decision and the right to petition for reconsideration is waived. The terms and\nconditions of this Final Order are effective upon service in accordance with 49 C.F.R. § 190.5.\nMay 1, 2018\n___________________________________ __________________________\nAlan K. Mayberry Date Issued\nAssociate Administrator\nfor Pipeline Safety","truncated":false,"body_characters":11386}