PHMSA issued an Advisory Bulletin to announce Guidance on operator requirements to measure integrity management program effectiveness under Part 192 and 195.  Issued as a supplement to a 2012 Advisory on the topic, the Advisory and associated Guidance respond to Agency inspections identifying weaknesses in this area and a NTSB recommendation following the San Bruno, California incident to develop and implement effectiveness standards for IM and other performance-based programs. The Guidance appears to impermissibly broaden the Agency’s requirements for IMP programs without pursuing formal notice and comment rulemaking.

The Guidance issued in conjunction with the Advisory states that it is intended to ‘expand and clarify’ PHMSA’s expectations for operator processes when measuring IM program effectiveness.  Major topic areas include establishing safety performance goals, identifying required and additional metrics, monitoring metrics and collecting data, and program evaluation.  The Guidance relies on requirements and processes found in PHMSA regulations as well as industry standards (some of which are not incorporated into the regulations such as API 1160 and ANSI/GPTC Z380) and picks up on some themes from API’s draft RP 1173 safety management standard.  PHMSA includes tables listing various legally-required metrics and extensive other programmatic and threat-specific metrics that operators could include in their documented IM program evaluations.  Notably, the Agency states that PHMSA inspectors will use the Guidance as criteria to assess the effectiveness of operator IM program evaluations.

As in other recent instances, PHMSA emphasizes that the Guidance is not a regulation and creates no new legal obligations.  This statement does not comport with the Agency’s stated intent to use the Guidance as criteria to evaluate operator programs during inspections, however, and presents another example of the Agency’s increasing reliance on informal publications to issue or expand substantive legal rules without observing traditional rulemaking procedures.  As we have previously noted, such practices are contrary to the fundamental precepts of administrative law, and are unlikely to withstand judicial scrutiny if challenged.  Moreover, these practices create increasing uncertainty in the industry, as operators attempt to comply with a ‘performance based’ (versus prescriptive) regulatory scheme which is being continually supplemented with non-binding, ‘guidance’ by the overseeing agency.