July 2019 Vol.74 No. 7

Washington Watch

First Infrastructure Bill Emerges in Congress

Steven Barlas | Washington Editor


House Democrats have introduced the first infrastructure package in Congress that would make significant new investments in broadband deployment and drinking water systems, among other areas. All 31 Democrats on the House Energy & Commerce Committee sponsored the LIFT America Act (H.R. 2741), which had a hearing in front of that committee on May 22, 2019.

The bill, with a $40-billion price tag, only touches on programs in that committee’s jurisdiction. It does not address funding for roads and bridges, for example, nor does it provide a funding source for the $40 billion.

There is one interesting, unexplained gas pipeline provision in the bill. It would authorize $1.5 billion in “assistance for low-income communities to support methane pipeline replacement.” The committee’s spokesman did not respond to a request for further details on that provision. Methane is the most-potent greenhouse gas, and Democratic leaders are trying to inject the LIFT bill with political momentum by marrying its infrastructure and “climate change” appeals.

Elgie Holstein, senior director for strategic planning, Environmental Defense Fund, says the concept was raised in meetings at the Energy Department during the Obama Administration, attended by environmental and pipeline representatives. The issue relates to distribution, not transmission, pipelines in cities with high percentages of low-income residents, where distribution companies argue raising rates to pay for methane leak plugging would hurt gas consumers unable to pay for the improvements. The idea is for the federal government to subsidize the distribution company capital expenditures.

At the hearings on May 22, Rep. Frank Pallone (D-N.J.), chairman of the committee and the key sponsor of the LIFT America Act, which he also introduced in the last Congress, said he hoped he would get Republican support for his bill. The top Republican on the committee, Rep. Greg Walden (Ore.) agreed that there were some good provisions in the bill, but he worried about a rush to spend money on projects that were not ready to go, which is what he said happened when Congress passed the 2009 stimulus package and ostensible “shovel-ready” projects were nowhere near ready. He particularly cited the Recovery Act’s spending on broadband deployment, where funds were appropriated prior to any national mapping being done to determine where underserved areas were located.

While Walden applauded some of what is in the Pallone bill, he also highlighted what it was missing, in his view, specifically pipeline permitting reform. There he repeatedly alluded to the need in New England for sources of natural gas and the difficulties of getting new pipelines built as permits have been delayed or disapproved, most often by state environmental departments. However, the EDF’s Holstein answers “emphatically not” when asked whether he thinks pipeline permitting reform should be part of an infrastructure package.

The LIFT Act would fund $40 billion in high-speed broadband internet buildout across the country. Walden implied that will happen without federal dollars, pointing to the T-Mobile-Sprint merger which the companies have said, if approved, will result in 5G broadband service being extended to 97 percent of the U.S. within three years.

The LIFT America Act includes provisions to extend and increase authorizations of $18.69 billion for essential drinking water programs including the Safe Drinking Water State Revolving Loan Fund. Interestingly, the same day the E&C committee held its hearings, the House Appropriations Committee passed an Environmental Protection Agency funding bill for fiscal 2020, which starts Oct. 1, 2019. Any authorization figures in the LIFT Act are advisory.

The Appropriations Committees actually provide the funds. So, it was noteworthy the House Appropriations Committee provided $1.784 billion for the Clean Water State Revolving Fund (CWSRF). According to the National Association of Clean Water Agencies, this proposed increase is $90 million over the recent fiscal years. The full House is expected to endorse the increase, but the Republican-controlled Senate may cut it back. On the negative side, the House appropriations bill also cuts funding for the Water Infrastructure Finance and Innovation Act (WIFIA) by $18 million to $50 million.

Pipeline Companies Oppose Proposed Mapping Requirements

The proposal from the Pipeline and Hazardous Materials Safety Administration (PHMSA) to force transmission and distribution pipelines to submit additional geospatial data to the National Pipeline Mapping System (NPMS) could cost the industry tens of millions of dollars in added expenses. Arick Sears, senior regulatory attorney, MidAmerican Energy Company, says the new reporting mandates for pipelines, if finalized, will cost his company $1 million.

Paiute Pipeline Company, in its comments to PHMSA, said the new data collection requirements would substantially increase the number of pipeline attributes collected from four to 19. “In Paiute’s case, the requested attributes reside in multiple databases/platforms outside of its geographic information system (GIS) and would require substantial data integration to provide the information requested in the geospatial formats specified by PHMSA,” wrote Mark Litwin, vice president/general manager of Paiute. “It is estimated this data integration activity will take several years to complete at a cost upwards of $1 million.”

The Pipeline Safety Act directs operators of pipeline facilities (except distribution and gathering pipelines) to submit geospatial data and technical data, such as design and material specifications, to PHMSA for use in the NPMS. PHMSA has collected data for the NPMS since 1998. The revised information collection described in PHMSA’s April 11, 2019, notice was first proposed in 2014 and modified in 2016. The revised, proposed data elements in the latest notice respond to comments received at those earlier times.

The first tranche of new data would be collected a year after whatever the PHMSA effective date becomes, if in fact the new data requirements are approved by the White House. Phase II information would be collected in the second year. Phase III would kick in in 2024 and transmission pipelines would have to submit positional accuracy of +/– 50 feet accuracy for all segments in Class 2, Class 3, or Class 4 areas; within an HCA; and where there are one or more buildings intended for human occupancy or an identified site within the potential impact radius (PIR). All other gas pipeline segments must be mapped to a positional accuracy of +/– 100 feet.

MidAmerican’s Sears commented to the PHMSA that “the most efficient and cost-effective method of bringing data elements into compliance with the proposed standard is to update centerlines during scheduled in-line inspection runs. Absent a critical emergency, MidAmerican finds it difficult to justify passing the additional expense on to its ratepayers. Accordingly, MidAmerican recommends that the data collection standard reinstate the original seven-year deadline for Phase-3 reporting.”

While the Phase III deadline is problematic for both transmission and liquid lines – the latter would have to submit data with a positional accuracy of +/– 50 feet – some elements in all three phases are controversial, including in-line inspection capability, which would be a Phase 1 requirement. On the one hand, Paiute said it has no problem submitting pipe diameter, wall thickness, pipe material, pipe grade, seam type, decade of installation, coated, onshore/offshore, class location, and abandoned pipelines.

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