| (a) Policy. Improved safety and environmental protection
are the desired outcomes of any enforcement action. Encouraging operators
to take appropriate voluntary corrective and future protective actions
once a violation has occurred is an effective component of the enforcement
process. Deterrence of violations through penalty assessments is also
a necessary and effective component of the enforcement process. A
rule-based enforcement penalty guideline to evaluate and rank pipeline
safety-related violations is consistent with the central goal of the
Commission's enforcement efforts to promote compliance. Penalty guidelines
set forth in this section will provide a framework for more uniform
and equitable assessment of penalties throughout the state, while
also enhancing the integrity of the Commission's enforcement program.
(b) Only guidelines. This section complies with the
requirements of Texas Natural Resources Code, §81.0531(d), and
Texas Utilities Code, §121.206(d). The penalty amounts contained
in the tables in this section are provided solely as guidelines to
be considered by the Commission in determining the amount of administrative
penalties for violations of provisions of Texas Natural Resources
Code, Title 3, relating to pipeline safety, or of rules, orders or
permits relating to pipeline safety adopted under those provisions,
and for violations of Texas Utilities Code, Chapter 121, Subchapter
E, or a safety standard or other rule prescribed or adopted under
that subchapter.
(c) Commission authority. The establishment of these
penalty guidelines shall in no way limit the Commission's authority
and discretion to cite violations and assess administrative penalties.
The typical minimum penalties listed in this section are for the most
common violations cited; however, this is neither an exclusive nor
an exhaustive list of violations that the Commission may cite. The
Commission retains full authority and discretion to cite violations
of Texas Natural Resources Code, Title 3, relating to pipeline safety,
or of rules, orders, or permits relating to pipeline safety adopted
under those provisions, and for violations of Texas Utilities Code,
Chapter 121, Subchapter E, or a safety standard or other rule prescribed
or adopted under that subchapter, and to assess administrative penalties
in any amount up to the statutory maximum when warranted by the facts
in any case, regardless of inclusion in or omission from this section.
(d) Factors considered. The amount of any penalty requested,
recommended, or finally assessed in an enforcement action will be
determined on an individual case-by-case basis for each violation,
taking into consideration the following factors:
(1) the person's history of previous violations, including
the number of previous violations;
(2) the seriousness of the violation and of any pollution
resulting from the violation;
(3) any hazard to the health or safety of the public;
(4) the degree of culpability;
(5) the demonstrated good faith of the person charged;
and
(6) any other factor the Commission considers relevant.
(e) Typical penalties. Typical penalties for violations
of provisions of Texas Natural Resources Code, Title 3, relating to
pipeline safety, or of rules, orders, or permits relating to pipeline
safety adopted under those provisions, and for violations of Texas
Utilities Code, §121.201, or a safety standard or other rule
prescribed or adopted under that provision are set forth in Table
1.
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(f) Penalty enhancements for certain violations. For
violations that involve threatened or actual pollution; result in
threatened or actual safety hazards; or result from the reckless or
intentional conduct of the person charged, the Commission may assess
an enhancement of the typical penalty, as shown in Table 2. The enhancement
may be in any amount in the range shown for each type of violation.
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(g) Penalty enhancements for certain violators. For
violations in which the person charged has a history of prior violations
within seven years of the current enforcement action, the Commission
may assess an enhancement based on either the number of prior violations
or the total amount of previous administrative penalties, but not
both. The actual amount of any penalty enhancement will be determined
on an individual case-by-case basis for each violation. The guidelines
in Tables 3 and 4 are intended to be used separately. Either guideline
may be used where applicable, but not both.
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(h) Penalty reduction for settlement before hearing.
The recommended penalty for a violation may be reduced by up to 50%
if the person charged agrees to a settlement before the Commission
conducts an administrative hearing to prosecute a violation. Once
the hearing is convened, the opportunity for the person charged to
reduce the basic monetary penalty is no longer available. The reduction
applies to the basic penalty amount requested and not to any requested
enhancements.
(i) Demonstrated good faith. In determining the total
amount of any penalty requested, recommended, or finally assessed
in an enforcement action, the Commission may consider, on an individual
case-by-case basis for each violation, the demonstrated good faith
of the person charged. Demonstrated good faith includes, but is not
limited to, actions taken by the person charged before the filing
of an enforcement action to remedy, in whole or in part, a violation
or to mitigate the consequences of a violation.
(j) Penalty calculation worksheet. The penalty calculation
worksheet shown in Table 5 lists the typical penalty amounts for certain
violations; the circumstances justifying enhancements of a penalty
and the amount of the enhancement; and the circumstances justifying
a reduction in a penalty and the amount of the reduction.
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