
[Federal Register Volume 79, Number 37 (Tuesday, February 25, 2014)]
[Proposed Rules]
[Pages 10461-10465]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2014-03205]


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DEPARTMENT OF TRANSPORTATION

Pipeline and Hazardous Materials Safety Administration

49 CFR Part 177

[Docket Number PHMSA-2007-28119 (HM-247)]
RIN 2137-AE37


Hazardous Materials: Cargo Tank Motor Vehicle Loading and 
Unloading Operations

AGENCY: Pipeline and Hazardous Materials Safety Administration (PHMSA), 
DOT.

ACTION: Withdrawal of notice of proposed rulemaking (NPRM).

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SUMMARY: PHMSA is closing this rulemaking proceeding under this docket 
having reconsidered our proposal for additional regulations associated 
with cargo tank motor vehicle (CTMV) loading or unloading operations. 
This action is based on the findings of the regulatory assessment, 
comments to docket of this rulemaking, and completion of a 
supplementary policy analysis on how best to address the safety risks 
of bulk loading and unloading operations. As an alternative to new 
regulatory requirements, PHMSA will be issuing a guidance document to 
provide best practices for CTMV loading and unloading operations; and 
will be conducting research to better understand the wide range of 
human factors that contribute to hazardous materials incidents 
including those associated with CTMV loading and unloading operations.

DATES: Effective February 25, 2014, the proposed rule published in the 
Federal Register on March 11, 2011 at 76 FR 13313 is withdrawn.

FOR FURTHER INFORMATION CONTACT: Dirk Der Kinderen, Office of Hazardous 
Materials Safety, Pipeline and Hazardous Materials Safety 
Administration, telephone (202-366-8553.

SUPPLEMENTARY INFORMATION:

I. Background
II. Regulatory Assessment
III. Comments on the NPRM
    A. Scope
    B. Risk Assessment
    C. Operating Procedures
    D. Training and Qualification
    E. Recordkeeping
    F. Compliance
IV. Reconsideration of the NPRM
    A. Guidance
    B. Outreach Campaign
    C. Human Factors Study
    D. Memorandum of Understanding
V. Conclusion

I. Background

    On March 11, 2011, PHMSA published an NPRM under Docket PHMSA-2007-
28119 (76 FR 13313) (HM-247) to amend the hazardous materials 
regulations (HMR; 49 CFR Parts 171-180) by requiring each person who 
engages in CTMV loading or unloading operations to perform a risk 
assessment of its loading and unloading operations and develop and 
implement safe operating procedures based upon the results of the risk 
assessment. PHMSA also proposed additional personnel training and 
qualification requirements for persons who perform these operations.
    In the NPRM, PHMSA discussed the safety problem associated with 
CTMV loading and unloading operations, including:
     A summary of loading and unloading incident data;
     National Transportation Safety Board (NTSB) and Chemical 
Safety Board (CSB) safety recommendations issued to PHMSA as a result 
of accident

[[Page 10462]]

investigations related to bulk loading and unloading operations; \1\
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    \1\ NTSB Safety Recommendations I-02-1, I-02-2, and R-04-10 and 
CSB Recommendation 2006-06-I-LA-RI. On July 12, 2013 PHMSA published 
safety advisory guidance (78 FR 41853) on safety precautions and 
recommended guidance for persons responsible for unloading or 
transloading hazardous materials from rail tank cars, specifically, 
heating of rail tank cars for unloading or transloading. The 
publication of this guidance resulted in the NTSB closing 
recommendations I-02-1 and I-02-2 as ``Closed--Acceptable 
Alternative Action.''
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     Recommended operating procedures proposed by the 
Interested Parties for Hazardous Materials Transportation (Interested 
Parties) (an informal association of offerors, carriers, and industrial 
package manufacturers);
     A petition (P-1506) for rulemaking submitted by the 
Dangerous Goods Advisory Council (DGAC); and
     Comments received in response to PHMSA's notice of 
recommended practices published on January 4, 2008 under Docket Number 
PHMSA-2007-28119 (73 FR 916) (Notice No. 07-9).
    In the NPRM, PHMSA indicated that adopting regulations to require 
offerors, carriers, or facility operators to develop and implement 
operating procedures governing the loading and unloading of a CTMV 
would enhance the safety of such operations. We solicited comments on 
the regulations proposed and the accuracy of PHMSA's cost and benefits 
estimates set forth in the preliminary regulatory impact assessment. 
The NPRM and supporting documents are available for review in the 
docket for this rulemaking at www.regulations.gov. A summary of the 
proposed changes is provided in the following Table 1:

        Table 1--Proposed New Requirements and Affected Entities
------------------------------------------------------------------------
           Affected entities                     New requirements
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Cargo tank carriers and facilities that   Assess the risks of
 engage in part 177 loading or            loading and unloading
 unloading operations.                    operations and develop written
                                          operating procedures.
                                          Train hazmat employees
                                          in the relevant aspects of the
                                          operational procedures.
                                          Annually qualify
                                          hazmat employees who perform
                                          loading and unloading
                                          operations.
Facilities providing transfer equipment   Develop and implement
 for cargo tank loading and unloading     a periodic maintenance
 operations under part 177.               schedule to prevent
                                          deterioration of equipment and
                                          conduct periodic operational
                                          tests to ensure that the
                                          equipment functions as
                                          intended.
                                          Ensure that the
                                          equipment meets the
                                          performance standards in part
                                          178 for specification CTMVs.
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II. Regulatory Assessment

    As part of PHMSA's initial rulemaking efforts in this area, a 
preliminary analysis was completed. Through this analysis it was 
apparent that shipments of hazardous materials (hazmat) by CTMV pose 
some level of risk to public safety on a daily basis. A 2007 Commodity 
Flow Survey by the Bureau of Transportation Statistics highlights this 
by indicating that an estimated 323.5 billion-ton-miles of hazardous 
materials were transported in 2007 of which approximately a third (104 
billion-ton-miles) was transported by truck and an additional 7 percent 
was by multimodal transport that included truck. We believe we can 
safely reason that a similar amount is transported annually today, 
which presents ample opportunity for incidents to occur during the 
course of highway transportation including during CTMV loading and 
unloading operations.
    As the HMR currently requires function specific training and 
recordkeeping of this training (See 49 CFR Part 172 Subpart H) and has 
loading and unloading requirements for transport via public highways 
(See 49 CFR Part 177 Subpart B), PHMSA expects that most entities 
already have some manner of documentation surrounding process review, 
training of personnel, and maintenance of equipment involved in these 
operations. Other federal agencies also have requirements associated 
with loading and unloading operations that encompass bulk transport 
vehicles. The Occupational Safety and Health Administration (OSHA) 
Process Safety Management (PSM) standard (See 29 CFR 1910.119) contains 
requirements for processes that use, store, manufacture, handle, or 
transport highly hazardous chemicals on-site including bulk-loading and 
unloading operations involving PSM-covered chemicals. Additionally, the 
Environmental Protection Agency (EPA) regulations establish a general 
duty clause for facility owners or operators of facilities that 
produce, handle, process, distribute, or store certain chemicals. The 
regulations entail identification of hazards associated with the 
accidental releases of extremely hazardous substances; prevention of 
such releases, and minimization of the consequences of releases.
    Despite these requirements incidents do continue to occur. An 
analysis of CTMV loading and unloading incidents during the 10-year 
period 2000-2009 revealed that, among other causes, human error is the 
greatest primary cause of accidents. Most human error accidents can be 
attributed to inattention to detail in performing a loading or 
unloading function, including failure to follow attendance 
requirements, leaving valves in open or closed positions, improperly 
connecting hoses and other equipment, or not disconnecting hoses prior 
to vehicles having completed fill operation. This leads to accidents 
such as overfilling receiving tanks, over-pressurizing CTMVs, or 
loading/unloading incompatible materials. About 3,500 incidents could 
be attributed to CTMV loading and unloading incidents. These incidents 
resulted in an estimated $68 million in societal damages, or $6.8 
million per year, during the 10-year analysis period. Thus, there is a 
cost to society from CTMV loading and unloading incidents.
    Following the publication of the HM-247 NPRM, PHMSA updated the 
regulatory assessment. The updated analysis estimated benefits 
associated with the proposed rule from avoidance of incidents at $1.7 
million annually while costs are estimated to be $1.1 million annually. 
The overall estimated impacts identified in the analysis are predicated 
on the level of existing pre-compliance and the overall effectiveness 
of the regulations. We assume 50 percent \2\ of affected entities would 
already be in compliance with the

[[Page 10463]]

proposed measures, and that implementation of the proposed regulations 
would reduce incidents by 40 percent.\3\
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    \2\ The 50 percent compliance rate is based on comments to the 
docket noting the prevalence of other non-DOT governmental 
requirements and anecdotal reports of use of industry codes.
    \3\ The 40 percent effectiveness rate is based on a literature 
review and our best judgment that indicates this rate is a 
reasonable estimate of the reduction of human errors should the NPRM 
be implemented.
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    Furthermore, in the absence of true data, we rely heavily on 
estimates of variables used in calculating the benefits and costs, 
either from previous analyses for other rulemaking efforts or from 
newly calculated estimates. Although, we did not receive adverse 
comments on our estimates and also received some supportive comments, 
we remain concerned about achieving a valid result. Despite the 1.5 
benefit-cost ratio PHMSA is concerned that the overall benefit of 
regulatory action is overestimated based on the role that human error 
plays in loading and unloading incidents. Due to this uncertainty, 
PHMSA conducted a supplementary policy analysis to help decision-makers 
determine whether regulatory action was the best path forward or if 
non-regulatory approaches may be just as effective. This supplementary 
analysis is discussed in Section IV of this withdrawal notice.

III. Comments on the NPRM

    In response to PHMSA's March 11, 2011 NPRM, PHMSA received comments 
from 44 organizations and individuals:

                     Table 2--Commenters to the NPRM
------------------------------------------------------------------------
              Commenter                Docket No.  PHMSA-2007-28119-XXXX
------------------------------------------------------------------------
Agricultural Retailers Association                                  0084
 (ARA)..............................
Akzo Nobel Chemicals, Inc...........                                0097
American Chemistry Council (ACC)....                          0053; 0085
American Gas Association (AGA)......                                0075
American Trucking Association (ATA).                          0047; 0091
Anonymous...........................  0059, 0061; 0062; 0063; 0064; 0067
Arkema, Inc.........................                                0046
Association of American Railroads...                                0048
Bayer Material Science..............                                0082
BP Products North America, Inc......                                0096
Brian T. Knapp......................                                0086
Dangerous Goods Advisory Council                              0065; 0081
 (DGAC).............................
Distrigas of Massachusetts, LLC.....                                0078
Dow Chemical Company (Dow)..........                                0070
Dupont Global Logistics.............                                0080
Far West Agribusiness Association                                   0066
 (FWAA).............................
Illinois Fertilizer & Chemical                                      0069
 Association (IFCA).................
International Brotherhood of                                        0089
 Teamsters (IBT)....................
Institute of Makers of Explosives                                   0079
 (IME)..............................
Joyce Dillard.......................                                0094
National Association of Chemical                              0052; 0087
 Distributers (NACD)................
National Association of State Fire                                  0054
 Marshals...........................
National Grid.......................                                0050
National Propane Gas Association                                    0088
 (NPGA).............................
National Tank Truck Carriers (NTTC).                          0051; 0095
National Transportation Safety Board                                0098
 (NTSB).............................
New England Fuel Institute..........                                0093
Petroleum Marketers Association of                            0092; 0099
 America (PMAA).....................
PPG Industries, Inc.................                                0090
Salt River Project Agricultural                                     0073
 Improvement and Power District
 (SRP)..............................
Sara Thane..........................                                0060
Society of Independent Gasoline                                     0076
 Marketers of America (SIGMA).......
Syngenta Crop Protection............                                0071
The Chlorine Institute..............                                0083
The Fertilizer Institute (TFI)......                                0084
U.S. Chemical Safety and Hazard                               0035; 0100
 Investigation Board (CSB)..........
Utility Solid Waste Activities Group                          0049; 0074
 (USWAG)............................
Valero Energy Corporation...........                                0068
Veolia ES Technical Solutions, LLC..                                0077
------------------------------------------------------------------------

    The comments are available for review in the docket for this 
rulemaking at www.regulations.gov. The comments generally opposed 
adoption of this rulemaking and covered the following range of topics 
associated with the proposed requirements: Scope; risk assessment; 
operating procedures; training and qualification; recordkeeping; and 
the compliance date. A brief summary of the essence of comments for 
each topic follows:

A. Scope

    Commenters noted confusion about the applicability of the proposed 
rule, namely, how the rulemaking would apply in the absence of a 
carrier at a facility as well as the extent of the reach of the 
applicability (e.g., Does it end at the first permanent valve on the 
receiving equipment?). Additionally, commenters questioned whether 
there is a minimum threshold before the rulemaking would apply (i.e., 
3,000 liters) and whether the rulemaking truly is performance-based 
rather than prescriptive.

B. Risk Assessment

    PHMSA proposed to require any person who loads or unloads hazmat or

[[Page 10464]]

provides transfer equipment to load or unload a CTMV to prepare a risk 
assessment of the operation. The risk assessment was to include 
specific minimum measures to address the safety of such operations. 
PHMSA received a substantial number of comments on the proposed 
provisions associated with this requirement to conduct a risk 
assessment. Commenters primarily expressed concern over the possibility 
of duplication of efforts by facilities and carriers.

C. Operating Procedures

    PHMSA proposed to require each person who is subject to the risk 
assessment requirement to develop, maintain, and adhere to an operating 
procedure for the specific loading or unloading operation based on the 
completed risk assessment. The operating procedures were to include 
provisions that address pre-loading/unloading, loading/unloading, 
emergency management, post-loading/unloading, design, maintenance and 
testing of transfer equipment, facility oversight of carrier personnel, 
and recordkeeping. Commenters questioned the intent of provisions for 
the maintenance and testing of transfer equipment within the operating 
procedure requirements. Commenters discussed additional issues such as 
alternative measures for attendance during a loading operation.

D. Training and Qualification

    PHMSA proposed annual evaluation of hazmat employees performing 
CTMV loading and unloading operations through measures such as direct 
observation of routine performance of duties or through practice 
sessions and drills. Many commenters strongly opposed this proposal. 
They generally asserted that PHMSA significantly underestimated the 
costs of such a requirement in the preliminary assessment for the NPRM.

E. Recordkeeping

    PHMSA proposed recordkeeping requirements for the written risk 
assessment and operating procedure. Several commenters suggested that 
this proposed requirement to document and retain risk assessments is 
overly burdensome and unnecessary.

F. Compliance

    Commenters requested an extended compliance date to allow for time 
to conduct a complete review of current practices and to implement 
improvements or updates while others suggested that a significant 
majority of potentially affected entities already have operating 
procedures in place that would satisfy the regulations set forth in 
this proposed rule such that an extended compliance period would not be 
necessary.

IV. Reconsideration of the NPRM

    PHMSA conducts a policy analysis to identify and manage risks in 
the transportation of hazmat. The policy analysis makes use of a risk 
management framework that defines the main elements of identified 
risk(s) and outlines possible ways to address the risk(s). The process 
begins when a risk in the transportation of hazmat is first assessed 
(e.g., when a risk is presented to PHMSA through an NTSB safety 
recommendation), and ends with an agency decision on implementation of 
an identified approach of how to manage the risk, such as implementing 
a new regulation.
    In consideration of the negative comments on the NPRM and 
uncertainties about regulatory action as well as the uncertainties of 
the regulatory assessment, PHMSA conducted a supplementary policy 
analysis to help decision-makers determine whether this effort is the 
best course of action. After this policy analysis, we reconsidered our 
approach to address the safety risks of bulk loading and unloading 
operations through rulemaking. The analysis raised concerns on the 
effectiveness of implementing any new regulations covering loading and 
unloading operations including whether any proposed regulations would 
be: (1) Redundant because the activity is already covered in some 
manner under the current HMR; (2) impactful in that many of the 
incidents having occurred in the past would probably continue to occur 
because of the human element in incidents indicating that further 
regulation may be ineffective; and (3) confusing to implement without 
an memorandum of understanding (MOU) among the agencies that have 
oversight clearly defining roles and enforcement of these types of 
operations.
    The subsequent recommendations of the assessment include (in no 
particular order of priority): (1) Preparing a guidance document that, 
together with current regulations, provides direction on bulk loading 
and unloading operational procedures, use of personal protective 
equipment, and maintenance and inspection of transfer equipment; (2) 
engaging in a rigorous outreach campaign to raise awareness; (3) 
implementing a human factor study associated with bulk loading and 
unloading operations; and (4) finalizing a (MOU) with the Occupational 
Safety and Health Administration (OSHA) and, possibly, the 
Environmental Protection Agency (EPA) in order to specify any new 
regulatory requirements and enforcement roles. These recommendations 
are discussed in further detail below.

A. Guidance

    Agency guidance includes any statement of policy, interpretation of 
a regulation, or any other method used to communicate to the regulated 
public the agency expectations. Guidance is not legally binding and may 
not mandate or require a particular action but rather is intended to 
provide helpful information, clarify a rule's or statute's meaning, or 
communicate our policy for implementing requirements. Based on concerns 
raised on the effectiveness of further regulation in the supplementary 
policy analysis, it is better served that PHMSA prepare a guidance 
document that provides helpful information on CTMV loading and 
unloading operations in addition to what is required by regulation. The 
guidance would cover, in part, training on operational procedures, 
provision of personal protection equipment, and maintenance and 
inspection of transfer equipment including emergency shutdown systems 
and would be based on the content and structure of the proposed 
regulations in the NPRM. Although not binding as stated earlier, we 
believe issuing a guidance document still provides an opportunity to 
enhance safety by clarifying the current requirements, providing 
helpful information, outlining our expectations for CTMV loading and 
unloading operations, and clearly attributing human error to loading 
and unloading incidents.

B. Outreach Campaign

    To supplement the abovementioned plans for issuing guidance, PHMSA 
plans to develop and implement an outreach program to raise awareness 
of the ongoing risk of CTMV loading and unloading incidents and to 
educate regulated entities on ways to prevent or mitigate the risks.

C. Human Factors Study

    Human factors research involves the study of the way humans relate 
to the world around them. Human factors certainly play a role in hazmat 
transportation especially bulk loading and unloading operations because 
individuals are directly involved (e.g., handling of transfer 
equipment) and thus, human factors research is included among the 
priorities of PHMSA's Office of Hazardous Materials Safety (OHMS)

[[Page 10465]]

research and development (R&D) five-year strategic plan (2012-2017). In 
general, from review of hazmat incident report data for all incident 
types, we have found that human error is the fourth-most cited cause of 
failure as is similarly indicated above in Section II specific to 
loading and unloading incidents.
    The goal of the OHMS R&D program is to enhance the safety mission 
and identify and mitigate the emerging risks associated with hazmat 
transportation and to better understand the factors contributing to 
these risks. This human factors research effort is, among other things, 
designed to supply information necessary to guide future changes in 
regulations. OHMS created this priority to examine human involvement in 
the release of hazmat (e.g., human error), to research regulations that 
involve human impact, and develop new strategies to reduce human 
handling errors. Although historically overlooked in hazmat 
transportation safety research, we view this type of research essential 
as the safe transportation of all hazmat involves human interaction 
within the transportation system. This research would involve some 
manner of assessment of human factors in bulk loading and unloading 
operations including for CTMV operations. Results of such research may 
bear out significant information that can be used to support future 
rulemaking action.

D. Memorandum of Understanding

    As part of a plan to enhance safety of bulk loading and unloading 
operations (including CTMV operations), PHMSA had envisioned 
development of an MOU with OSHA to clarify responsibilities. This plan 
called for a two-pronged approach of an MOU supplemented by a phased 
rulemaking approach (i.e., first a rulemaking to address CTMV loading 
and unloading operations followed by rulemakings for tank cars and 
other bulk packaging). But, since we are withdrawing this rulemaking, 
PHMSA does not plan to develop an MOU at this time because development 
of the MOU was intended to be directly linked to the new regulations 
proposed in the NPRM.

V. Conclusion

    PHMSA has concluded that adopting the regulations proposed under 
the NPRM is not the best course of action at this time. PHMSA has based 
this decision on its concerns that further regulation would create 
redundancies, confusion, and possibly be ineffective in preventing many 
of the very same incidents it is intended to address. Non-regulatory 
approaches are available in the short term that would still provide an 
opportunity to enhance safety of CTMV loading and unloading operations 
by raising awareness and communicating our expectations. Key non-
regulatory activities include:
    1. Issuing a guidance document for CTMV loading and unloading 
operations;
    2. Implementing an outreach campaign to educate the regulated 
community on current regulatory requirements and best safety practices; 
and
    3. Conducting human factors research to examine human involvement 
in release of hazmat and to potentially use this to support future 
consideration of rulemaking to address CTMV loading and unloading 
operations.
    Accordingly, PHMSA is withdrawing the March 11, 2011 NPRM and 
terminating this rulemaking proceeding.

    Issued in Washington, DC on February 10, 2014, under authority 
delegated in 49 CFR Part 106.

Magdy El-Sibaie,
Associate Administrator for Hazardous Materials Safety, Pipeline and 
Hazardous Materials Safety Administration.
[FR Doc. 2014-03205 Filed 2-24-14; 8:45 am]
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