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(Parenthesis ( ) Indicate Expenditure Decreases)

SOURCES OF INFORMATION

LFC Files

Public Regulation Commission

SUMMARY

Synopsis of Bill

House Bill 587 amends numerous statutes that relate to excavation damage to pipelines and underground utility lines [Section 62-14-1 to Section 62-14-10 NMSA 1978]. In general, the additions and clarifications make changes to hold accountable for pipeline safety incidents owners/operators of underground facilities, excavators, and operators of one-call notification systems. A section-by-section summary is outlined below:

Section 1. Amends Section 62-14-2 by adding two new definitions to the statute: "emergency excavation" and "reasonable efforts" to make the statute more clear in its reference of these terms. Deletes a major portion of the "pipeline" definition by eliminating the exemption for gathering lines or systems operated exclusively for gathering of oil or gas, etc. Reorders, alphabetically, the definitions.

Section 2. Amends Section 62-14-3 to prohibit excavators from concealing a violation of this statute, to require reaffirmation of line location every ten days after initial line locate request, and to require continued excavation work to be done in a manner to prevent damage. Makes technical corrections.

Section 3. Adds two new subsections to Section 62-14-5. The first requires an owner of underground facilities to mark in paint with the words "Clear" or "No Underground Facilities" in those locations where facilities are not present, or contact the excavator directly. The second new subsection prohibits excavators from concealing a violation of this statute. Makes technical corrections.

Section 4. Adds a new section to the statute, which standardizes the color code scheme for marking locations of underground facilities.

Section 5. Makes technical corrections to Section 62-14-6 to align with the changes to definitions.

Section 6. Allows exemptions for owners from the one-call notification system [Section 62-14-7.1], pursuant to federal law. Makes technical corrections.

Section 7. Amends Section 62-14-8 making operators of underground facilities, excavators, or operators of the one-call notification system accountable for complying with the statute and gives authority to the Public Regulation Commission (PRC) to hear violations and assess administrative penalties of up to $5.0 for the first offense and $25.0 for subsequent offenses. The PRC is required to adopt rules for alternative dispute resolution. Strikes the language that requires either the Office of the Attorney General or relevant District Attorney to pursue civil remedies to violations in district court.

Section 8. Makes the effective of the bill July 1, 2001.

Significant Issues

A substantial change in the bill is that it removes the language in the definition of "pipeline" which currently exempted several components that aid in the collection and transportation of products such as gathering pipelines and compressor/pumping stations. The exemption is not valid for systems in close proximity of municipalities and other locations as identified in the current statute. However, as New Mexico has learned this past year, pipelines in desolate locations can have a devastating impact on public health and safety.

A report⁽¹⁾

issued by the U.S. Governmental Accounting Office (GAO) stated that "the total number of major pipeline accidents increased by about 4 percent annually" over a 10-year period from 1989 to 1998. The GAO data indicate that the primary causes of these accidents results from outside forces, such as excavation.

FISCAL IMPLICATIONS

House Bill 587 does not carry an appropriation. Enactment would have only a minor impact on the PRC, of which it could absorb. The changes proposed in the bill could meet with approval of the Office of Pipeline Safety, and as a result, could result in additional federal funding for the Transportation Division of the PRC. Consequently, the Legislature should encourage the PRC to pursue this potential funding source. Currently, the Transportation Division receives roughly 10 percent of its operating budget from the federal government.

ADMINISTRATIVE IMPLICATIONS

Enactment would have only a minor impact on the PRC, of which it could absorb.

MFV/njw

1. U.S. GAO. "Pipeline Safety: The Office of Pipeline Safety is Changing How it Oversees the Pipeline Industry." Report to the Ranking Minority Member, Committee on Commerce, U.S. House of Representatives, RCED-00-128, May 2000.