National Propane Gas Ass'n v. U.S. Dept. of Trans.

• Decision Date: 17 March 1999
• Docket Number: No. Civ.A. 3:97-CV-2576-D.,Civ.A. 3:97-CV-2576-D.
• Citation: 43 F.Supp.2d 665
• Parties: NATIONAL PROPANE GAS ASSOCIATION, et al., Plaintiffs, v. The UNITED STATES DEPARTMENT OF TRANSPORTATION, et al., Defendants.
• Court: U.S. District Court — Northern District of Texas

43 F.Supp.2d 665

NATIONAL PROPANE GAS ASSOCIATION, et al., Plaintiffs, v. The UNITED STATES DEPARTMENT OF TRANSPORTATION, et al., Defendants.

No. Civ.A. 3:97-CV-2576-D.

United States District Court, N.D. Texas, Dallas Division.

March 17, 1999.

COPYRIGHT MATERIAL OMITTED

Eric A. Kuwana, Patton Boggs, Washington, DC, David Patrick Long, Kevin D. Green, Judith W. Bagley, Patton Boggs, Dallas, TX, for plaintiffs.

Sandra M. Schraibman, Sylvia T. Kaser, U.S. Department of Justice, Civil Division, Washington, DC, Nancy E. Machado, U.S. Department of Transportation, Research and Special Programs, Washington, DC, James P. Laurence, Ass't U.S. Atty., Dallas, TX, for defendants.

FITZWATER, District Judge.

This is a suit to stay the effectiveness of, and to enjoin defendants from enforcing, a final rule of the Research and Special Programs Administration ("RSPA") of the United States Department of Transportation ("DOT") entitled, "Hazardous Materials: Cargo Tank Motor Vehicles in Liquefied Compressed Gas Service," codified at 49 C.F.R. § 171.5(a)(1)(iii) (1997) (the "Final Rule"), and defendants' interpretation of another regulation, 49 C.F.R. § 177.834(i) (1997) (the "Attendance Regulation"). Plaintiffs allege various violations of the Administrative Procedure Act, 5 U.S.C. § 551 et. seq. ("APA"), and the Regulatory Flexibility Act, 5 U.S.C. §§ 601-612 ("RFA"). The court upholds the Final Rule and defendants' interpretation of the Attendance Rule.

I

A

Liquefied compressed gases, including propane, are delivered by cargo tank motor vehicles.¹ These vehicles are classified by DOT as specification MC 331 large highway transport tank vehicles and specification MC 330 small local delivery vehicles (bobtail trucks).² Large vehicles deliver propane primarily to bulk storage and industrial facilities; small vehicles, by contrast, distribute propane chiefly to consumer-size tanks at houses, farms, and other smaller-volume users. These vehicles are regulated by Hazardous Material Regulations ("HMR"), codified at 49 C.F.R. pts. 171-180, first issued by the Interstate Commerce Commission in 1941, and periodically modified thereafter by RSPA. RSPA or its predecessor promulgated the HMR under authority delegated from the Secretary of Transportation (the "Secretary"), see 49 C.F.R. § 1.53 (1998), whom Congress authorized by statute to promote public safety by regulating the transportation of hazardous materials.

Among the HMR safety provisions is the emergency discharge control regulation. 49 C.F.R. § 178.337-11(a) (1997). This rule requires that cargo tank motor vehicle product discharge openings be protected with an excess flow valve or an internal self-closing stop valve, either of which must automatically close if any tank attachment is sheared off or any attached hoses or piping are separated. 49 C.F.R. §§ 178.337-11(a)(1)(i) & 178.337-8(a)(2) (1997). The mandatory use of emergency discharge control systems is intended to mitigate large-scale releases of hazardous materials that could result in personal injury and property destruction. The HMR also include the Attendance Regulation. 49 C.F.R. § 177.834(i). This rule mandates operator attendance during unloading operations, thereby ensuring that operator-dependent emergency countermeasures can be taken in the event of partial hose or piping rupture, separation, or leak.

In 1997 RSPA adopted the Final Rule in response to what it concluded were serious threats to public safety caused by noncompliance with the requirements of § 178.337-11(a) and the attendance requirements of § 177.834(i)(3).

B

The investigation of a September 8, 1996 incident in Sanford, North Carolina — which revealed widespread industry non-compliance with the HMR — in principal part prompted the rulemaking process at issue in this case. In the Sanford accident more than 35,000 gallons of propane were released during a delivery by a specification MC 331 cargo tank motor vehicle at a bulk storage facility. This mishap occurred when the discharge hose from the cargo tank separated at its hose coupling at the storage tank inlet connection, resulting in the release of most of the vehicle's 9,800 gallons and more than 30,000 gallons from the storage tanks. According to RSPA, when the driver became aware of the system failure he immediately shut down the engine, which in turn stopped the discharge pump, but he could not access the remote closure control to close the internal stop valve. The emergency discharge control system's excess flow feature did not function and propane continued to be released. The back flow check valve on the storage tank did not function, resulting in the additional release of propane from the storage tanks.

Based on preliminary information from Sanford, RSPA published on December 13, 1996 an advisory notice in the Federal Register, alerting persons involved in the design, manufacture, or use of specification MC 330 and MC 331 cargo tank motor vehicles of the problem with the excess flow feature, and reminding them that these tanks and their components must conform to the HMR. See 61 Fed.Reg. 65480 (1996). In response to the notice, plaintiff National Propane Gas Association ("NPGA") and Mississippi Tank Company ("MTC"), a manufacturer of specification MC 331 cargo tank motor vehicles, submitted emergency exemption applications from the HMR.³ These requests led RSPA to find that the problem concerning failure of the excess flow feature with the emergency discharge control systems was more extensive than originally believed. For example, MTC provided preliminary information in support of its exemption application that prompted RSPA to conclude "that there is reason to suspect the problem may be common to nearly all cargo tank motor vehicles used in liquefied compressed gas service within the United States" and that the problem may also exist in non-specification cargo tanks. 62 Fed.Reg. 7638, 7639 (1997).

Based on the emergency exemption applications, discussions with the applicants, information developed by the Federal Highway Administration ("FHWA") investigation of the Sanford incident, the regulatory history related to the issues, and knowledge of the liquefied compressed gas industry, RSPA and FHWA developed certain information and opinions related to the failure of the excess flow feature with the emergency discharge control system on cargo tanks used to transport liquefied compressed gases. They found that emergency discharge control systems on cargo tanks that transport liquefied gases incorporate as their two basic safety features (1) an excess flow feature designed to stop the flow of gas automatically when piping, fittings, or hoses rupture or separate, and (2) a remotely controlled internal self-closing stop valve. RSPA concluded that most specification MC 330 and MC 331 cargo tank motor vehicles are fitted with an internal self-closing stop valve that incorporates an excess flow feature. Section 178.337-11(a)(1)(i) does not mandate that an internal self-closing stop valve have an excess flow feature. It requires instead that the discharge valve automatically close if any one of its attachments is sheared off or if any attached hoses or piping is separated. Equipment such as a system that measures a differential in pressure, a pressure drop, or a hose or piping separation, and automatically closes the internal self-closing stop valve on the cargo tank and stops product discharge in case of separation or rupture of a hose or piping, may be used to meet the emergency discharge control system performance requirement specified in § 178.337-11(a)(1)(i).

After evaluating the circumstances that the NPGA and MTC emergency exemption applications presented, RSPA found that there was an emergency that applied broadly to many persons and that had far-reaching safety and economic consequences.⁴ RSPA concluded that the long-standing requirements of the HMR neither were well understood nor complied with fully. The evaluation of the Sanford incident revealed that the HMR-mandated level of safety was not being achieved on equipment currently produced and certified by cargo tank manufacturers. The tanks did not comply with the requirement for automatic closure of internal self-closing stop valves and excess flow valves in the event of hose or piping separation. Industry had attempted to increase efficiency in unloading hazardous materials by installing pumps on specification MC 330 and MC 331 cargo tank motor vehicles. While increasing product transfer speed, these pumps prevented emergency discharge control systems from operating properly under all temperatures and pressures routinely encountered during normal transportation conditions.

RSPA also determined that, besides installing pumps, industry had introduced internal self-closing stop valves with an emergency feature designed to function at flow rates well above the discharge capacity of the pump. This effectively assured uninterrupted product transfer by eliminating inadvertent functioning of the emergency discharge control system. Consequently, in most product discharge system configurations, the pump functioned as a regulator in the product discharge line to eradicate any potential for the emergency discharge control system to function in case of a line separation. RSPA noted that it was unaware of readily available off-the-shelf equipment capable of providing a functioning automatic excess flow feature on cargo tanks without removal of pumps and other restrictions. RSPA also concluded that NPGA bulletins issued in 1978 and 1990 demonstrated that the industry had been aware since at least 1978 that excess flow valves were not designed to function where piping system restrictions, such as pumps, decreased the flow rate to less than the excess flow valve's closing flow, rendering the emergency discharge control systems ineffective.

RSPA also pointed out that although concerns had been expressed for decades concerning...