{"operation":"document","citation":"CPF 520075034","title":"GOLDEN VALLEY ELECTRIC ASSOCIATION, INC — Notice of Probable Violation","source_type":"enforcement","agency":"Pipeline and Hazardous Materials Safety Administration","status":"historical","official":true,"published_on":"2007-09-12","effective_on":null,"summary":"CLOSED notice of probable violation citing 195.452(f)(5).","machine_formats":{"json":"https://regulus.evalyn.ai/document/phmsa-enforcement-520075034.json","markdown":"https://regulus.evalyn.ai/document/phmsa-enforcement-520075034.md"},"app_url":"https://regulus.evalyn.ai/document/phmsa-enforcement-520075034","source_url":"https://primis.phmsa.dot.gov/enforcement-data/case/520075034","body":"Notice of Probable Violation involving GOLDEN VALLEY ELECTRIC ASSOCIATION, INC. PHMSA's enforcement data identifies the cited regulation as 195.452(f)(5). The case was opened on 2007-09-12 and is reported as closed as of 2010-05-14. Proposed civil penalty: $20,000. Assessed civil penalty: $20,000. Open the official case record for notices, responses, orders, and the latest status.\n\nOfficial case documents:\n\n520075034_ Decision on the Petition for Reconsideration_05052010 _text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520075034/520075034_%20Decision%20on%20the%20Petition%20for%20Reconsideration_05052010%20_text.pdf\n\n520075034_closure letter_01052011.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520075034/520075034_closure%20letter_01052011.pdf\n\n520075034_closure letter_01052011_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520075034/520075034_closure%20letter_01052011_text.pdf\n\n520075034_Decision on the  Petition for Reconsideration_05052010.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520075034/520075034_Decision%20on%20the%20%20Petition%20for%20Reconsideration_05052010.pdf\n\n520075034_FinalOrder_09012009.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520075034/520075034_FinalOrder_09012009.pdf\n\n520075034_FinalOrder_09012009_text.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520075034/520075034_FinalOrder_09012009_text.pdf\n\n520075034_Petition for Reconsideration_09112009.pdf: https://primis.phmsa.dot.gov/enforcement-documents/520075034/520075034_Petition%20for%20Reconsideration_09112009.pdf\n\n520075034_Decision on the  Petition for Reconsideration_05052010.pdf\n\nU.S. Department of Transportation\n1200 New Jersey Ave, S.E.\nSafety Administration\nPipeline and Hazardous Materials\nWashington, D.C. 20590\nMAY 5 2010\nMr. Brian Newton\nPresident and Chief Executive Officer\nGolden Valley Electric Association\nPO Box 71249\nFairbanks, AK 99707-1249\nRe: CPF No. 5-2007-5034\nDear Mr. Newton:\nEnclosed please find the Decision on Reconsideration issued in the above-referenced case.\nIt denies your Petition for Reconsideration and affirms the Final Order without\nmodification. Service of the Decision by certified mail is deemed effective upon the date of\nmailing, or as otherwise provided under 49 C.F.R. § 190.5.\nThank you for your cooperation in this matter.\nSincerely,\nMaut Mann\nlor Jeffrey D.!\nAssociate Administrator\nfor Pipeline Safety\nEnclosure\nMr. Chris Hoidal, Director, Western Region, PHMSA\nCERTIFIED MAIL - RETURN RECEIPT REQUESTED [7005 1160 0001 0043 9344]\n\n\n\nU.S. DEPARTMENT OF TRANSPORTATION\nPIPELINE AND HAZARDOUS MATERIALS SAFETY ADMINISTRATION\nOFFICE OF PIPELINE SAFETY\nWASHINGTON, D.C. 20590\nIn the Matter of\nGolden Valley Electric\nCPF No. 5-2007-5034\nAssociation,\nPetitioner.\nDECISION ON RECONSIDERATION\nIn a September 1, 2009 Final Order, I found that Golden Valley Electric Association (GVEA or\nPetitioner) had failed to submit a timely written response to a September 12, 2007 Notice of\nProbable Violation and Proposed Civil Penalty (Notice). On that basis, I further found that the\ncompany had waived its right to contest the allegations in the Notice, that it had committed both\nof the probable violations, and that it should be assessed a $20,000 civil penalty.\nOn September 11, 2009, GVEA submitted a Petition for Reconsideration (Petition). In its\nPetition, the company states that its failure to initially respond to the Notice was the result of a\nclerical error, and that it was not made fully aware of this proceeding until April 21, 2008, the\ndate of another Office of Pipeline Safety (OPS) inspection. Petitioner also states that the civil\npenalty assessed in the Final Order should be reduced for several reasons.\nHaving fully considered the record in this matter, I find that GVEA has not presented any\npersuasive factual or legal basis in support of reconsideration. I am, therefore, denying this\nPetition and affirming the September 1, 2009 Final Order without modification.\nI.\nDiscussion\nThe Pipeline Safety Regulations permit the filing of a petition for reconsideration of a final\norder. However, this is not a right of appeal or to seek a de novo review of the record.' Rather,\nreconsideration is an opportunity to present the agency with previously unavailable information\nand, if appropriate, to request that any errors in the final order be corrected. That is why the\n' 49 C.F.R. § 190.215(a)-(e).\n\n\n\n2\nAssociate Administrator does not consider repetitious information or arguments on\nreconsideration. It is also why a petitioner must provide a valid reason for consideration of facts\nor arguments that were not raised on its behalf in a timely manner.\nPetitioner states that its failure to submit a written response within 30 days of receiving the\nNotice was the result of a clerical error. I am willing to assume, for purposes of this proceeding,\nthat such an error might constitute good cause for failing to comply with that requirement.\nHowever, GVEA also neglected to submit a response after receiving actual notice of this\nproceeding during the April 2008 OPS inspection, and I am not willing to assume that a failure to\ncomply with our procedural requirements should be excused under such circumstances.\nThe Pipeline Safety Regulations state that a\"[flailure of the respondent to respond\" to a Notice in\na timely manner \"constitutes a waiver of the right to contest the allegations in the notice of\nprobable violation and authorizes the Associate Administrator, OPS, without further notice to the\nrespondent, to find facts to be as alleged in the notice of probable violation and to issue a final\norder under $190.213.\"2 In this case, GVEA did not submit a timely response and has not shown\nthat its failure should be excused for good cause. Accordingly, I find that there is no basis for\nreconsideration of the $20,000 civil penalty assessed in the Final Order.\nRELIEF DENIED\nBased on the information provided in the Petition, a review of the relevant portions of the record,\nand for the reasons stated above, I am denying this Petition and affirming the Final Order\nwithout modification.\nThis Decision is the final administrative action in this proceeding.\nMAY 5 2010\nLor- Jeffrey D. Wiese\nDate Issued\nAssociate Administrator\nfor Pipeline Safety\n= 49 C.F.R. § 190.209(c).\n\n520075034_FinalOrder_09012009_text.pdf\n\nSEP 01 2009\nMr. Brian Newton\nPresident and CEO\nGolden Valley Electric Association\n758 Illinois Street\nFairbanks, AK 99707-1249\nRe: CPF No. 5-2007-5034\nDear Mr. Newton:\nEnclosed is the Final Order issued in the above-referenced case. It makes findings of violation\nand assesses a civil penalty of $20,000. The penalty payment terms are set forth in the Final\nOrder. This enforcement action closes automatically upon payment. Your receipt of the Final\nOrder constitutes service of that document 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: Chris Hoidal, Director, Western Region, PHMSA\nDennis Hinnah, Deputy Director, Western Region, PHMSA\nCERTIFIED MAIL – RETURN RECEIPT REQUESTED [7005 0390 0005 6162 5838]\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)\nGolden Valley Electric Association, ) CPF No. 5-2007-5034\n)\nRespondent. )\n______________________________ )\nFINAL ORDER\nBetween January 9 - 11, 2006, pursuant to 49 U.S.C. § 60117, a representative of the Pipeline\nand Hazardous Materials Safety Administration, Office of Pipeline Safety (OPS) conducted an\non-site pipeline safety inspection of the facilities and records of Golden Valley Electric\nAssociation (GVEA or Respondent) in Fairbanks, Alaska. GVEA operates crude oil supply and\nreturn pipelines between the Trans Alaska Pipeline System (TAPS) North Pole metering facility\nand another metering facility that supplies crude oil to two refineries and the GVEA power plant.\nTotal pipeline mileage is 4.6 miles. As a result of the inspection, the Director, Western Region,\nOPS (Director), issued to Respondent, by letter dated September 12, 2007, a Notice of Probable\nViolation and Proposed Civil Penalty (Notice). In accordance with 49 C.F.R. § 190.207, the\nNotice proposed finding that Respondent had violated 49 C.F.R. §§ 195.452(f)(5), (j)(3) and\n(j)(4)(i) and proposed assessing a civil penalty of $20,000 for the alleged violations.\nGVEA failed to respond within 30 days after it had received the Notice. Respondent’s failure to\nrespond constitutes a waiver of their right to contest the allegations in the Notice and authorizes\nthe entry of this Final Order.\nFINDINGS OF VIOLATION\nRespondent did not contest the allegations in the Notice that it violated 49 C.F.R. Part 195, as\nfollows:\nItem 1: The Notice alleged that Respondent violated 49 C.F.R. § 195.452(j)(3),\nwhich states:\n§ 195.452 Pipeline Integrity management in high consequence areas.\n(a) …\n(j) What is a continual process of evaluation and assessment to\nmaintain a pipeline's integrity?\n\n\n\n2\n(1) General. After completing the baseline integrity assessment, an\noperator must continue to assess the line pipe at specified intervals and\nperiodically evaluate the integrity of each pipeline segment that could\naffect a high consequence area.\n(2) . . .\n(3) Assessment intervals. An operator must establish five-year\nintervals, not to exceed 68 months, for continually assessing the line pipe's\nintegrity. An operator must base the assessment intervals on the risk the\nline pipe poses to the high consequence area to determine the priority for\nassessing the pipeline segments. An operator must establish the\nassessment intervals based on the factors specified in paragraph (e) of this\nsection, the analysis of the results from the last integrity assessment, and\nthe information analysis required by paragraph (g) of this section.\nThe Notice alleged that GVEA violated § 195.452(j)(3) by failing to reassess its 14-inch crude\noil pipeline within 68 months of the previous assessment. As evidence of that violation, the\nNotice stated that GVEA performed a baseline hydrostatic test on the line on August 12, 1998,\nbut still had not reassessed the line as of January 11, 2006, the last day of the OPS inspection.\nto the Integrity Management requirements of Subpart F. Accordingly, I find that Respondent\nviolated 49 C.F.R. § 195.452(j)(3) by failing to reassess its 14-inch crude oil pipeline within 68\nmonths of the previous assessment.\nGVEA’s pipeline system, which could affect one or more High Consequence Areas,1 is subject\nItem 2: The Notice alleged that Respondent violated 49 C.F.R. § 195.452(j)(4)(i), which states:\n§ 195.452 Pipeline Integrity management in high consequence areas.\n(a) ….\n(j) What is a continual process of evaluation and assessment to maintain a pipeline's\nintegrity?\n(1) General. After completing the baseline integrity assessment, an operator must\ncontinue to assess the line pipe at specified intervals and periodically evaluate the\nintegrity of each pipeline segment that could affect a high consequence area.\n(2) ….\n(4) Variance from the 5-year intervals in limited situations-\n(i) Engineering basis. An operator may be able to justify an engineering basis for a\nlonger assessment interval on a segment of line pipe. The justification must be supported\nby a reliable engineering evaluation combined with the use of other technology, such as\nexternal monitoring technology, that provides an understanding of the condition of the\nline pipe equivalent to that which can be obtained from the assessment methods allowed\nin paragraph (j)(5) of this section. An operator must notify OPS 270 days before the end\n1 An HCA is defined as: (1) A commercially navigable waterway, which means a waterway where a substantial\nlikelihood of commercial navigation exists; (2) A high population area, which means an urbanized area, as defined\nand delineated by the Census Bureau, that contains 50,000 or more people and has a population density of at least\n1,000 people per square mile; (3) An other populated area, which means a place, as defined and delineated by the\nCensus Bureau, that contains a concentrated population, such as an incorporated or unincorporated city, town,\nvillage, or other designated residential or commercial area; (4) An unusually sensitive area. See 49 C.F.R.\n§ 195.450.\n\n\n\n3\nof the five-year (or less) interval of the justification for a longer interval, and propose an\nalternative interval. An operator must send the notice to the address specified in\nparagraph (m) of this section.\nThe Notice alleged that GVEA violated § 195.452(j)(4)(i) by failing to properly notify OPS\nbefore the end of the maximum five-year reassessment interval of its justification for establishing\na longer reassessment interval for a particular segment of line pipe. Specifically, the Notice\nalleged that Respondent scheduled its 14-inch crude oil pipeline for reassessment and evaluation\nin 2007, nearly a decade after the previous baseline assessment of August 12, 1998. The Notice\nfurther alleged that Respondent failed to provide OPS with notice 270 days before August 12,\n2003, the end of the maximum five-year reassessment interval, of its justification for establishing\nthat longer interval. The Notice also stated that GVEA had still not provided OPS with that\nnotification as of January 11, 2006, the last day of the inspection. Accordingly, I find that\nRespondent violated 49 C.F.R. §195.452(j)(4)(i) by failing to notify OPS before the end of the\nmaximum five-year reassessment interval of the justification for a longer interval.\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.\n49 U.S.C. § 60122 and 49 C.F.R. § 190.225 require that, in determining the amount of the civil\npenalty, I 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; the Respondent’s ability to pay the penalty and any effect that\nthe penalty may have on its ability to continue doing business; and the good faith of Respondent\nin attempting to comply with the pipeline safety regulations. In addition, I may consider the\neconomic benefit gained from the violation without any reduction because of subsequent\ndamages, and such other matters as justice may require. The Notice proposed a total civil\npenalty of $20,000 for the violations.\nNotice Item 1 proposed a civil penalty of $10,000 for violation of 49 C.F.R. § 195.452(j)(3), for\nRespondent’s failure to reassess its 14-inch crude oil pipeline within 68 months of the previous\nassessment. Inspecting pipeline at the mandated intervals is a key part of maintaining pipeline\nsafety and protecting the environment. Pipeline operators are obligated to assess and evaluate\ntheir pipeline as frequently as required, but no less often than every 68 months. Accordingly,\nhaving reviewed the record and considered the assessment criteria, I assess Respondent a civil\npenalty of $10,000 for violating 49 C.F.R. § 195.452(j)(3).\nNotice Item 2 proposed a civil penalty of $10,000 for violation of 49 C.F.R. § 195.452(j)(4)(i),\nfor Respondent’s failure to notify OPS before the end of the maximum five-year reassessment\ninterval of its justification for establishing a longer interval. When a pipeline operator\n\n\n\n4\nestablishes a reassessment interval that exceeds the mandated interval of five-years (or less),\nOPS must receive a timely notification of that decision. Moreover, the notification must include\nan adequate justification for that decision, one supported by a reliable engineering evaluation and\nthe use of such other technology as may be appropriate. Timely notification that an operator will\nexceed the mandated pipeline reassessment intervals would reflect an operator’s attempt to\ncomply with pipeline safety regulations. Accordingly, having reviewed the record and\nconsidered the assessment criteria, I assess Respondent a civil penalty of $10,000 for violating\n49 C.F.R. § 195.452(j)(4)(i).\nGVEA has presented no information that would warrant a reduction in the civil penalty proposed\nin the Notice. Accordingly, having reviewed the record and considered the assessment criteria, I\nassess Respondent a total civil penalty of $20,000.\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 this payment 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, OK 73125; (405) 954-8893.\nFailure to pay the $20,000 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 United\nStates District Court.\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 the Associate Administrator, Office of Pipeline\nSafety, PHMSA, 1200 New Jersey Avenue, SE, East Building, 2nd Floor, Washington, DC\n20590. The petition must be received within 20 days of Respondent’s receipt of this Final Order\nand must contain a brief statement of the issue(s). The filing of the petition automatically stays\nthe payment of any civil penalty assessed. However if Respondent submits payment for the civil\npenalty, the Final Order becomes the final administrative decision and the right to petition for\nreconsideration is waived. The terms and conditions of this Final Order are effective upon\nreceipt.\n___________________________________ __________________________\nJeffrey D. Wiese Date Issued\nAssociate Administrator\nfor Pipeline Safety\n\n520075034_ Decision on the Petition for Reconsideration_05052010 _text.pdf\n\nMAY 5 2010\nMr. Brian Newton\nPresident and Chief Executive Officer\nGolden Valley Electric Association\nPO Box 71249\nFairbanks, AK 99707-1249\nRe: CPF No. 5-2007-5034\nDear Mr. Newton:\nEnclosed please find the Decision on Reconsideration issued in the above-referenced case. It\ndenies your Petition for Reconsideration and affirms the Final Order without modification.\nService of the Decision by certified mail is deemed effective upon the date of mailing, or as\notherwise 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. Chris Hoidal, Director, Western Region, PHMSA\nCERTIFIED MAIL – RETURN RECEIPT REQUESTED [7005 1160 0001 0043 9344]\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 )\nGolden Valley Electric ) CPF No. 5-2007-5034\nAssociation, )\n)\n)\n)\nPetitioner. )\n______________________________)\nDECISION ON RECONSIDERATION\nIn a September 1, 2009 Final Order, I found that Golden Valley Electric Association (GVEA or\nPetitioner) had failed to submit a timely written response to a September 12, 2007 Notice of\nProbable Violation and Proposed Civil Penalty (Notice). On that basis, I further found that the\ncompany had waived its right to contest the allegations in the Notice, that it had committed both\nof the probable violations, and that it should be assessed a $20,000 civil penalty.\nOn September 11, 2009, GVEA submitted a Petition for Reconsideration (Petition). In its\nPetition, the company states that its failure to initially respond to the Notice was the result of a\nclerical error, and that it was not made fully aware of this proceeding until April 21, 2008, the\ndate of another Office of Pipeline Safety (OPS) inspection. Petitioner also states that the civil\npenalty assessed in the Final Order should be reduced for several reasons.\nHaving fully considered the record in this matter, I find that GVEA has not presented any\npersuasive factual or legal basis in support of reconsideration. I am, therefore, denying this\nPetition and affirming the September 1, 2009 Final Order without modification.\nI. Discussion\nThe Pipeline Safety Regulations permit the filing of a petition for reconsideration of a final\norder. However, this is not a right of appeal or to seek a de novo review of the record.1\nRather,\nreconsideration is an opportunity to present the agency with previously unavailable information\nand, if appropriate, to request that any errors in the final order be corrected. That is why the\n1 49 C.F.R. § 190.215(a)-(e).\n\n\n\n2\nAssociate Administrator does not consider repetitious information or arguments on\nreconsideration. It is also why a petitioner must provide a valid reason for consideration of facts\nor arguments that were not raised on its behalf in a timely manner.\nPetitioner states that its failure to submit a written response within 30 days of receiving the\nNotice was the result of a clerical error. I am willing to assume, for purposes of this proceeding,\nthat such an error might constitute good cause for failing to comply with that requirement.\nHowever, GVEA also neglected to submit a response after receiving actual notice of this\nproceeding during the April 2008 OPS inspection, and I am not willing to assume that a failure to\ncomply with our procedural requirements should be excused under such circumstances.\nThe Pipeline Safety Regulations state that a“[f]ailure of the respondent to respond” to a Notice in\na timely manner “constitutes a waiver of the right to contest the allegations in the notice of\nprobable violation and authorizes the Associate Administrator, OPS, without further notice to the\nrespondent, to find facts to be as alleged in the notice of probable violation and to issue a final\nthat its failure should be excused for good cause. Accordingly, I find that there is no basis for\nreconsideration of the $20,000 civil penalty assessed in the Final Order.\norder under §190.213.”2 In this case, GVEA did not submit a timely response and has not shown\nRELIEF DENIED\nBased on the information provided in the Petition, a review of the relevant portions of the record,\nand for the reasons stated above, I am denying this Petition and affirming the Final Order\nwithout modification.\nThis Decision is the final administrative action in this proceeding.\n_____________________________ __________________________\nJeffrey D. Wiese Date Issued\nAssociate Administrator\nfor Pipeline Safety\n2 49 C.F.R. § 190.209(c).\n\n520075034_closure letter_01052011_text.pdf\n\nCERTIFIED MAIL - RETURN RECEIPT REQUESTED\nJanuary 5, 2011\nMr. Brian Newton\nPresident and CEO\nGolden Valley Electric Association\n758 Illinois Street\nFairbanks, AK 99707-1249\nCPF 5-2007-5034\nDear Mr. Newton:\nOn September 1, 2009, the Pipeline and Hazardous Materials Safety Administration\n(PHMSA) issued to Golden Valley Electric Association (GVEA) a Final Order in the above-\nreferenced case. This Order included a Civil Penalty assessment which would automatically\nclose the enforcement action upon receipt of payment. On May 14, 2010, PHMSA received\nGVEA’s payment and accordingly, this case is now closed and no further action is needed\nwith respect to the matters involved in this case. Thank you for your cooperation in this\nmatter.\nSincerely,\nDennis Hinnah\nDeputy Director, Western Region\nPipeline and Hazardous Materials Safety Administration\ncc: PHP-60 Compliance Registry\nPHP-500 J. Strawn (#116644)","truncated":false,"body_characters":24303}