Enrolled Bill Summary

            Senate Bill 310 amends state law to continue the Railroad Commission of Texas until September 1, 2013, and to incorporate standard across-the-board provisions generally applicable to state agencies. In addition to these across-the-board provisions, the bill makes numerous changes in the statutes specific to the commission's regulatory authority.

            To increase revenues to the oil-field cleanup fund so that it can meet the state's current and anticipated liabilities, the bill requires the commission to reestablish specific performance goals for the fund through the biennial legislative appropriations request process, including goals for well plugging and site remediation; raises the cap on the fund to $20 million, with a $10 million lower threshold to restart collection of oil field regulatory fees; and prescribes specific fee increases in the statutes. The bill also requires the commission to maintain fund expenditure reports identifying expenditures for cleanup activities, staff salaries, contract amounts, and wells and sites cleaned up, and it creates an Oil-Field Cleanup Fund Advisory Committee to monitor expenditures and activities.

            The bill includes provisions to improve financial assurance requirements and enforcement to address the problem of abandoned wells and polluted sites, and it allows the commission to establish a voluntary program to provide incentives to landowners and developers to clean up contaminated oil field sites, allowing such landowners and developers to be statutorily released from liability from future cleanup costs.

            The bill allows the commission to establish rules for risk-based assessment of efforts to remediate contaminated oil and gas sites, and it requires the commission to prioritize testing of high-risk wells under its jurisdiction. Specifically, the bill requires the commission to identify abandoned wells in the state's inventory that have a higher risk of contaminating surface water or groundwater, determine the need to test such wells, and periodically test them, giving priority to plugging high-risk wells with compromised casings.

            The bill enhances state regulation of pipelines by requiring the commission to consider standard criteria in its penalty structure for pipeline safety violations, establishing a structure for determining penalty levels and a more standardized process for administering penalties, and authorizing the commission to require an operator to submit an assessment or testing plan for approval under certain conditions. The bill sets forth conditions under which a pipeline assessment or testing plan would be required and establishes detailed requirements for the contents of such plans. To improve safety standards for pipeline operators and owners, the bill requires the commission to require operators of certain pipeline facilities to communicate and conduct liaison activities with emergency response officials; the commission also must require the owner or operator of a pipeline facility within 1,000 feet of a public school to develop an emergency response plan. Other related provisions expand public notice requirements for new or expanded pipeline systems and provide for a study of the desirability of requiring a pipeline operator, owner, or manager to establish and provide evidence of financial responsibility to protect the public from costs resulting from pipeline discharges.

            The bill transfers gas utility rate cases from the commission to the State Office of Administrative Hearings. The bill also authorizes certain electronic financial transactions, allowing the commission to collect fees and penalty payments electronically and allowing gas utilities, on receiving a customer request, to bill customers over the Internet or by other electronic means. Other provisions streamline the process for the commission to dispose of equipment from delinquent, inactive wells; clarify requirements for testing of gas piping systems in schools; allow municipalities to surrender jurisdiction over gas utilities to the commission; and clarify gas utilities' obligation to serve certain commercial customers.

            Senate Bill 310 takes effect September 1, 2001, except for provisions relating to drilling permit fees and financial security requirements, which take effect September 1, 2004.