{"operation":"document","citation":"CPF 320185008","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":"2018-07-03","effective_on":null,"summary":"CLOSED notice of probable violation citing 195.440(d)(2), 195.440(g), 195.571, 195.573(c), 195.589(a)(2).","machine_formats":{"json":"https://regulus.evalyn.ai/document/phmsa-enforcement-320185008.json","markdown":"https://regulus.evalyn.ai/document/phmsa-enforcement-320185008.md"},"app_url":"https://regulus.evalyn.ai/document/phmsa-enforcement-320185008","source_url":"https://primis.phmsa.dot.gov/enforcement-data/case/320185008","body":"Notice of Probable Violation involving COUNTRYMARK REFINING AND LOGISTICS, LLC. PHMSA's enforcement data identifies the cited regulations as 195.440(d)(2),  195.440(g),  195.571,  195.573(c),  195.589(a)(2). The case was opened on 2018-07-03 and is reported as closed as of 2018-12-10. Proposed civil penalty: $39,900. Assessed civil penalty: $39,900. Open the official case record for notices, responses, orders, and the latest status.\n\nOfficial case documents:\n\n320185008_Final Order_12102018.pdf: https://primis.phmsa.dot.gov/enforcement-documents/320185008/320185008_Final%20Order_12102018.pdf\n\n320185008_Final Order_12102018_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/320185008/320185008_Final%20Order_12102018_text.pdf\n\n320185008_NOPV PCP_07032018.pdf: https://primis.phmsa.dot.gov/enforcement-documents/320185008/320185008_NOPV%20PCP_07032018.pdf\n\n320185008_NOPV PCP_07032018_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/320185008/320185008_NOPV%20PCP_07032018_text.pdf\n\n320185008_Operator Response to Notice_07202018.pdf: https://primis.phmsa.dot.gov/enforcement-documents/320185008/320185008_Operator%20Response%20to%20Notice_07202018.pdf\n\n320185008_Final Order_12102018_text.pdf\n\nDecember 10, 2018\nMr. Charlie Smith\nChief Executive Officer\nCountrymark Cooperative Holding Corporation\n225 South East Street, Suite 144\nIndianapolis, Indiana 46202\nRe: CPF No. 3-2018-5008\nDear Mr. Smith:\nEnclosed please find the Final Order issued in the above-referenced case to your subsidiary,\nCountrymark Refining and Logistics, LLC. It makes findings of violation and assesses a civil\npenalty of $39,900. This is to acknowledge receipt of payment of the full penalty amount by\nwire transfer dated August 2, 2018. This enforcement action is now closed. Service of the Final\nOrder by certified mail is effective upon the date of mailing as provided under 49 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 C. Beshore, Director, Central Region, Office of Pipeline Safety, PHMSA\nMr. Ash Titzer, Manager, Crude Gathering and Transportation, Countrymark Refining\nand Logistics, LLC, 1200 Refinery Road, Mt. Vernon, Indiana 47620\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 )\nCountrymark Refining and Logistics, LLC, )\na subsidiary of Countrymark Cooperative ) CPF No. 3-2018-5008\nHolding Cooperation, )\n)\n)\n)\nRespondent. )\n__________________________________________)\nFINAL ORDER\nFrom March 14 through March 18, 2016, pursuant to 49 U.S.C. § 60117, a representative of the\nPipeline and Hazardous Materials Safety Administration (PHMSA), Office of Pipeline Safety\n(OPS), conducted an on-site pipeline safety inspection of the facilities and records of\nCountrymark Refining and Logistics, LLC’s (Countrymark or Respondent) rural regulated\ngathering system in Mount Vernon, Indiana. Countrymark’s system consists of 22.48 miles of\njurisdictional 12” and 16” crude-oil and 4.4 miles of 6” jurisdictional highly volatile liquids\n(HVL) pipeline.1 Countrymark is a subsidiary of Countrymark Cooperative Holding\nCooperation.2\nAs a result of the inspection, the Director, Central Region, OPS (Director), issued to Respondent,\nby letter dated July 3, 2018, a Notice of Probable Violation and Proposed Civil Penalty (Notice),\nwhich also included warnings pursuant to 49 C.F.R. § 190.205. In accordance with 49 C.F.R.\n§ 190.207, the Notice proposed finding that Countrymark had violated 49 C.F.R. §§ 195.571 and\n195.573 and proposed assessing a civil penalty of $39,900 for the alleged violations. The\nwarning items required no further action, but warned the operator to correct the probable\nviolations or face possible future enforcement action.\nCountrymark responded to the Notice by letter dated July 20, 2018 (Response). The company\ndid not contest the allegations of violation and paid the proposed civil penalty of $39,900. In\naccordance with 49 C.F.R. § 190.208(a)(1), such payment authorizes the Associate\nAdministrator to make findings of violation and to issue this final order without further\nproceedings.\n1 Pipeline Safety Violation Report (Violation Report), (July 3, 2018) (on file with PHMSA), at 1.\n2 Countrymark website, available at https://www.countrymark.com/countrymark/aboutus/contactus.aspx (last\naccessed September 28, 2018) See also, Bloomberg Countrymark Snapshot, available at\nhttps://www.bloomberg.com/research/stocks/private/snapshot.asp?privcapid=290862711 (last accessed September\n28, 2018).\n\n\n\nCPF 3-2018-5008\nPage 2\nFINDINGS OF VIOLATION\nIn its Response, Countrymark did not contest the allegations in the Notice that it violated 49\nC.F.R. Part 195, as follows:\nItem 3: The Notice alleged that Respondent violated 49 C.F.R. § 195.571, which states:\n§ 195.571 What criteria must I use to determine the adequacy of cathodic\nprotection?\nCathodic protection required by this subpart must comply with one or more\nof the applicable criteria and other considerations for cathodic protection\ncontained in paragraphs 6.2.2, 6.2.3, 6.2.4, 6.2.5 and 6.3 in NACE SP 0169\n(incorporated by reference, see §195.3).\nThe Notice alleged that Respondent violated 49 C.F.R. § 195.571 by failing to comply with one\nor more applicable criteria and other considerations for cathodic protection (CP) contained in\nparagraph 6.2.2 of NACE [Standard Practice (SP)] 0169. Specifically, the Notice alleged that\nthe 2013-2016 CP readings that Countrymark provided to PHMSA failed to demonstrate how\nvoltage (IR) drop was considered in the CP criteria it used to determine if CP levels were\nadequate, as required by NACE SP 0169, section 6.2.2.1.1.3\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. § 195.571 by failing to consider IR\ndrop in the CP criteria it used to determine if CP levels were adequate, as required by NACE SP\n0169, section 6.2.2.1.1\nItem 4: The Notice alleged that Respondent violated 49 C.F.R. § 195.573(c), which states, in\nrelevant part:\n§ 195.573 What must I do to monitor external corrosion control?\n(a) . . . .\n(c) Rectifiers and other devices. You must electrically check for proper\nperformance each device in the first column at the frequency stated in the\nsecond column.\nDevice Check frequency\nRectifier……………………... At least six times each calendar year, but\nwith intervals not exceeding 2½\nmonths….\n3 NACE SP 0169 Section 6.2.2. Steel and Cast Iron Piping.\n6.2.2.1- External corrosion control can be achieved at various levels of cathodic polarization depending on\nthe environmental conditions. However, in the absence of specific data that demonstrate that adequate CP has been\nachieved, one or more of the following shall apply:\n6.2.2.1.1.- A negative (cathodic) potential of at least 850 mV with the CP applied. This potential is\nmeasured with respect to a saturated copper/copper sulfate reference electrode contacting the electrolyte. Voltage\ndrops other than those across the structure-to-electrolyte boundary must be considered for valid interpretation of this\nvoltage measurement. . . .\n\n\n\nCPF 3-2018-5008\nPage 3\nThe Notice alleged that Respondent violated 49 C.F.R. § 195.573(c) by failing to monitor its\nexternal corrosion control provided by rectifiers at least six times each year, but with intervals\nnot to exceed 2½ months. Specifically, the Notice alleged that Countrymark had 11 rectifier\nchecks that exceeded the 2½ month interval from 2013-2016.\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. § 195.573(c) by failing to monitor its\nexternal corrosion control provided by rectifiers at least six times each year, but with intervals\nnot to exceed 2½ months.\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$200,000 per violation for each day of the violation, up to a maximum of $2,000,000 for any\nrelated series of violations.4 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 $39,900 for the violations cited above.\nItem 3: The Notice proposed a civil penalty of $19,100 for Respondent’s violation of 49 C.F.R.\n§ 195.571, for failing to consider IR drop in the CP criteria that it used to determine if CP levels\nwere adequate, as required by NACE SP 0169, section 6.2.2.1.1. Countrymark neither contested\nthe allegation nor presented any evidence or argument justifying a reduction in or elimination of\nthe proposed penalty. Accordingly, having reviewed the record and considered the assessment\ncriteria, I assess Respondent a civil penalty of $19,100 for violation of 49 C.F.R. § 195.571.\nItem 4: The Notice proposed a civil penalty of $20,800 for Respondent’s violation of 49 C.F.R.\n§ 195.573(c), for failing to monitor its external corrosion control provided by rectifiers at least\nsix times each year, but with intervals not to exceed 2½ months. Countrymark neither contested\nthe allegation nor presented any evidence or argument justifying a reduction in or elimination of\nthe proposed penalty. Accordingly, having reviewed the record and considered the assessment\ncriteria, I assess Respondent a civil penalty of $20,800 for violation of 49 C.F.R. § 195.573(c).\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 $39,900, which was paid in full by\nwire transfer on August 2, 2018.\n4 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 3-2018-5008\nPage 4\nWARNING ITEMS\nWith respect to Items 1, 2, and 5, the Notice alleged probable violations of Part 195 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. § 195.440(d)(2) (Item 1) ─ Respondent’s alleged failure to include\nprovisions in its public awareness program to educate the public, appropriate\ngovernment organizations, and persons engaged in excavation-related activities\non the possible hazards associated with unintended releases from hazardous liquid\nor carbon dioxide pipeline facility. Specifically, Respondent allegedly failed to\nprovide sufficient information about potential hazards, such as fire and\nexplosions, in its excavator and affected-public brochures in effect in March\n2016. The Regional Director noted that Countrymark had revised and corrected\nits brochure on June 6, 2016, and thus no further action is required.\n49 C.F.R. § 195.440(g) (Item 2) ─ Respondent’s alleged failure to conduct its\npublic awareness program in other languages commonly understood by a\nsignificant number and concentration of the non-English speaking population in\nthe operator’s area. Specifically, Respondent failed to evaluate whether a\nsignificant number and concentration of non-English speakers were in its area.\nThe Regional Director noted that by December 29, 2016, Countrymark had\ncorrected this issue by conducting a language survey and updating its public\nawareness plan to include frequencies for new language surveys and a threshold\npercentage for a significant non-English speaking population.\n49 C.F.R. § 195.589(a)(2) (Item 5) ─ Respondent’s alleged failure to maintain\ncurrent records of maps to show the location of cathodic protection facilities,\nincluding galvanic anodes, installed after January 28, 2002. Specifically,\nRespondent allegedly failed to have anode bed locations identified on system\ndrawings or other records. The Regional Director noted that on or before May 26,\n2016, Countrymark had corrected this by adding latitudes and longitudes for\nanode beds to its drawings.\nIf OPS finds a violation of any of these items in a subsequent inspection, Respondent may be\nsubject to future enforcement action.\nThe terms and conditions of this Final Order are effective upon service in accordance with 49\nC.F.R. § 190.5.\nDecember 10, 2018\n___________________________________ __________________________\nAlan K. Mayberry Date Issued\nAssociate Administrator\nfor Pipeline Safety","truncated":false,"body_characters":13243}