By Earley                                             H.B. No. 2016
          Substitute the following for H.B. No. 2016:
          By Earley                                         C.S.H.B. No. 2016
                                 A BILL TO BE ENTITLED
    1-1                                AN ACT
    1-2  relating to the regulation of the storage of hazardous liquids in
    1-3  salt dome storage facilities; providing civil and administrative
    1-4  penalties.
    1-5        BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
    1-6        SECTION 1.  The Natural Resources Code is amended by adding
    1-7  Title 11 to read as follows:
    1-8          TITLE 11.  MISCELLANEOUS USES OF NATURAL RESOURCES
    1-9                  CHAPTER 211.  HAZARDOUS LIQUID SALT
   1-10                        DOME STORAGE FACILITIES
   1-11                   SUBCHAPTER A.  GENERAL PROVISIONS
   1-12        Sec. 211.011.  DEFINITIONS.  In this chapter:
   1-13              (1)  "Commission" means the Railroad Commission of
   1-14  Texas.
   1-15              (2)  "Hazardous liquid" means any liquid which is not
   1-16  defined as a solid or hazardous waste by Section 361 of the Water
   1-17  Code, and which is:
   1-18                    (A)  petroleum or any petroleum or liquid natural
   1-19  gas product; or
   1-20                    (B)  any hydrocarbon in a liquid state, other
   1-21  than liquified natural gas, that has been determined by the United
   1-22  States secretary of transportation to be a hazardous liquid.
   1-23              (3)  "Salt dome storage of hazardous liquids" means the
   1-24  storage of a hazardous liquid in any salt formation or bedded salt
    2-1  formation storage facility, but does not include a facility the
    2-2  regulation of which has been preempted by regulations adopted under
    2-3  the Hazardous Liquid Pipeline Safety Act of 1979 (49 App. U.S.C.
    2-4  Section 2001 et seq.) or the Natural Gas Pipeline Safety Act of
    2-5  1968 (49 App. U.S.C. Section 1671 et seq.).
    2-6              (4)  "Salt dome storage facility" includes any new or
    2-7  existing salt formation or bedded salt formation storage cavern and
    2-8  any equipment, facility, or building used or intended for use in
    2-9  the storage of a hazardous liquid in the salt formation cavern.
   2-10        Sec. 211.002.  POWERS OF LOCAL GOVERNMENTS.  (A)  This
   2-11  chapter does not reduce, limit, or impair the authority provided by
   2-12  law to any municipality, except as provided by Subsection (b) of
   2-13  this section.
   2-14        (b)  A municipality or county may not adopt or enforce an
   2-15  ordinance or other regulation that establishes safety standards or
   2-16  practices applicable to hazardous liquid salt formation storage
   2-17  facilities that are subject to regulation by federal or state law.
   2-18                SUBCHAPTER B.  REGULATION OF FACILITIES
   2-19        Sec. 211.011.  JURISDICTION.  The commission has jurisdiction
   2-20  over all salt dome storage of hazardous liquids and over facilities
   2-21  used for the storage of hazardous liquids in salt domes.
   2-22        Sec. 211.012.  RULES AND STANDARDS.  (a)  The commission
   2-23  shall adopt rules to establish safety standards for and practices
   2-24  applicable to the storage of hazardous liquid in salt domes and the
   2-25  facilities used for such storage.  The rules shall require:
   2-26              (1)  the installation and periodic testing of safety
   2-27  devices at a salt dome storage facility;
    3-1              (2)  the establishment of emergency notification
    3-2  procedures in the event of a release of a hazardous substance that
    3-3  the operator of the facility determines poses a substantial risk to
    3-4  the public;
    3-5              (3)  fire prevention and response procedures;
    3-6              (4)  employee and third-party contractor safety
    3-7  training with respect to the operation of the facility; and
    3-8              (5)  other requirements that the commission finds
    3-9  necessary and reasonable for the safe construction, operation, and
   3-10  maintenance of salt dome storage facilities.
   3-11        (b)  The commission may grant exceptions to its rules or
   3-12  impose additional requirements in any permit or amended permit
   3-13  issued to a facility if the facility, as permitted, will not cause
   3-14  an unreasonable danger to the public.
   3-15        Sec. 211.013.  RECORDS AND REPORTS.  (a)  Each owner or
   3-16  operator of a hazardous liquid salt dome storage facility shall
   3-17  maintain records, make reports, and provide any information the
   3-18  commission may require with respect to the construction, operation,
   3-19  or maintenance of the facility.  The operator of a hazardous liquid
   3-20  salt dome storage facility shall report or make available for
   3-21  inspection the results of any commission required test of a safety
   3-22  device installed at the facility to the commission within 10 days
   3-23  after the day of the test.
   3-24        (b)  The commission by rule shall designate the records
   3-25  required to be maintained and the reports required to be filed by
   3-26  the owner or operator and shall provide forms for reports if
   3-27  necessary.
    4-1        (c)  The commission may require the owner or operator of a
    4-2  hazardous liquid salt dome storage facility to prepare a safety
    4-3  procedural manual for the facility.  The commission may require the
    4-4  owner or operator to file the manual with the commission for
    4-5  approval or to make the manual available for inspection by an
    4-6  employee or agent of the commission.
    4-7        Sec. 211.014.  INSPECTIONS AND EXAMINATIONS.  (a)  The
    4-8  commission or its employee or designated agent may enter property
    4-9  on which a hazardous liquid salt dome storage facility is located
   4-10  or any other property relating to the storage of a hazardous liquid
   4-11  in a salt dome and may inspect and examine the property and any
   4-12  records located on the property to the extent relevant to determine
   4-13  if a person is acting in compliance with this chapter and any rules
   4-14  adopted by the commission under this chapter.
   4-15        (b)  Before the commission or its employee or agent enters
   4-16  manned property for the purposes of this section, the person
   4-17  requesting entry must present proper credentials to the person in
   4-18  charge of the property.
   4-19        (c)  An entry, examination, or inspection under this section
   4-20  must be made only at a reasonable time and in a reasonable manner.
   4-21                      SUBCHAPTER C.  ENFORCEMENT
   4-22        Sec. 211.031.  CIVIL PENALTY.  A person who violates this
   4-23  chapter or a rule adopted by the commission under this chapter is
   4-24  subject to a civil penalty of not more than $1,000 for each act of
   4-25  violation and for each day of violation.  The total amount of
   4-26  penalties that may be assessed under this section for a related
   4-27  series of violations may not exceed $200,000.
    5-1        Sec. 211.032.  ENFORCEMENT BY COMMISSION AND ATTORNEY
    5-2  GENERAL.  (a)  If it appears that a person has been or is violating
    5-3  this chapter or a rule of the commission adopted under this
    5-4  chapter, the commission may institute a civil suit in a district
    5-5  court for injunctive relief to restrain the person from continuing
    5-6  the violation or for the assessment and recovery of a civil penalty
    5-7  under Section 211.031 of this code, or for both the injunctive
    5-8  relief and the civil penalty.
    5-9        (b)  On application for injunctive relief and a finding that
   5-10  a person has violated or is violating this chapter or a rule of the
   5-11  commission under this chapter, the district court shall grant the
   5-12  injunctive relief that the facts warrant.
   5-13        (c)  At the request of the commission, the attorney general
   5-14  shall institute and conduct a suit under this section in the name
   5-15  of the state.
   5-16        (d)  The provisions of this section are in addition to and do
   5-17  not preempt the commission's authority under Sections 91.201-7 of
   5-18  this code.
   5-19        Sec. 211.033.  ADMINISTRATIVE PENALTY.  (a)  The commission
   5-20  may impose an administrative penalty against a person who:
   5-21              (1)  violates this chapter or a rule or order adopted
   5-22  under this chapter;
   5-23              (2)  intentionally or knowingly destroys or damages or
   5-24  attempts to destroy or damage a hazardous liquid salt dome storage
   5-25  facility; or
   5-26              (3)  intentionally or knowingly disables a safety
   5-27  device in a hazardous liquid salt dome storage facility, except to
    6-1  facilitate a repair; maintain, repair, or test the device; or
    6-2  conduct an activity reasonably necessary for the safe operation of
    6-3  the facility.
    6-4        (b)  The penalty may be in an amount not to exceed $25,000.
    6-5  Each day a violation occurs or continues constitutes a separate
    6-6  violation for the purpose of this section.
    6-7        (c)  In determining the amount of the penalty, the commission
    6-8  shall consider:
    6-9              (1)  the seriousness of the violation, including the
   6-10  nature, circumstances, extent, and gravity of any prohibited acts,
   6-11  and the hazard or potential hazard created to the health, safety,
   6-12  or welfare of the public;
   6-13              (2)  the economic harm to property or the environment
   6-14  caused by the violation;
   6-15              (3)  the history of previous violations;
   6-16              (4)  the amount necessary to deter future violations;
   6-17              (5)  efforts to correct the violation; and
   6-18              (6)  any other matter that justice may require.
   6-19        (d)  If the commission after investigation determines that a
   6-20  violation has occurred, the commission shall issue a preliminary
   6-21  report that states the facts on which the determination is based
   6-22  and the amount of the penalty.
   6-23        (e)  Not later than the 14th day after the date the report is
   6-24  issued, the commission shall give written notice of the report to
   6-25  the person charged with the violation.  The notice may be given by
   6-26  certified mail.  The notice must include a brief summary of the
   6-27  alleged violation and a statement of the amount of the penalty and
    7-1  must inform the person that the person has a right to a hearing on
    7-2  the occurrence of the violation, the amount of the penalty, or both
    7-3  the occurrence of the violation and the amount of the penalty.
    7-4        (f)  Not later than the 20th day after the date the person
    7-5  receives the notice, the person in writing may accept the
    7-6  determination and penalty of the commission or may make a written
    7-7  request for a hearing on the occurrence of the violation, the
    7-8  amount of the penalty, or both the occurrence of the violation and
    7-9  the amount of the penalty.
   7-10        (g)  The commission by order may impose the penalty if the
   7-11  person accepts the determination and the penalty.
   7-12        (h)  If the person requests a hearing or fails to respond
   7-13  timely to the notice, the commission shall set a hearing and give
   7-14  notice of the hearing to the person.  The hearing shall be held by
   7-15  a hearing examiner designated by the commission.  The hearing
   7-16  examiner shall make findings of fact and conclusions of law and
   7-17  promptly issue to the commission a proposal for a decision about
   7-18  the occurrence of the violation and the amount of the penalty.
   7-19  Based on the findings of fact, conclusions of law, and proposal for
   7-20  a decision, the commission by order may find that a violation has
   7-21  occurred and impose a penalty or may find that no violation
   7-22  occurred.
   7-23        (i)  The notice of the commission's order given to the person
   7-24  under the Administrative Procedure and Texas Register Act (Article
   7-25  6252-13a, Vernon's Texas Civil Statutes) must include a statement
   7-26  of the right of the person to judicial review of the order.
   7-27        (j)  Not later than the 30th day after the date the
    8-1  commission's order is final as provided by Section 16(c),
    8-2  Administrative Procedure and Texas Register Act (Article 6252-13a,
    8-3  Vernon's Texas Civil Statutes), the person shall:
    8-4              (1)  pay the amount of the penalty;
    8-5              (2)  pay the amount of the penalty and file a petition
    8-6  for judicial review contesting the occurrence of the violation, the
    8-7  amount of the penalty, or both the occurrence of the violation and
    8-8  the amount of the penalty; or
    8-9              (3)  without paying the amount of the penalty, file a
   8-10  petition for judicial review contesting the occurrence of the
   8-11  violation, the amount of the penalty, or both the occurrence of the
   8-12  violation and the amount of the penalty.
   8-13        (k)  Within the 30-day period, a person who acts under
   8-14  Subsection (j)(3) of this section may:
   8-15              (1)  stay enforcement of the penalty by:
   8-16                    (A)  paying the amount of the penalty to the
   8-17  court for placement in an escrow account; or
   8-18                    (B)  giving to the court a supersedeas bond
   8-19  approved by the court for the amount of the penalty and that is
   8-20  effective until all judicial review of the board's order is final;
   8-21  or
   8-22              (2)  request the court to stay enforcement of the
   8-23  penalty by:
   8-24                    (A)  filing with the court a sworn affidavit of
   8-25  the person stating that the person is financially unable to pay the
   8-26  amount of the penalty and is financially unable to give the
   8-27  supersedeas bond; and
    9-1                    (B)  giving a copy of the affidavit to the
    9-2  executive director by certified mail.
    9-3              (l)  If the commission receives a copy of an affidavit
    9-4  under Subsection (k)(2) of this section, the commission may file
    9-5  with the court, within five days after the date the copy is
    9-6  received, a contest to the affidavit.  The court shall hold a
    9-7  hearing on the facts alleged in the affidavit as soon as
    9-8  practicable and shall stay the enforcement of the penalty on
    9-9  finding that the alleged facts are true.  The person who files an
   9-10  affidavit has the burden of proving that the person is financially
   9-11  unable to pay the amount of the penalty and to give a supersedeas
   9-12  bond.
   9-13        (m)  If the person does not pay the amount of the penalty and
   9-14  the enforcement of the penalty is not stayed, the commission may
   9-15  refer the matter to the attorney general for collection of the
   9-16  amount of the penalty.
   9-17        (n)  Judicial review of the order of the commission:
   9-18              (1)  is instituted by filing a petition as provided by
   9-19  Section 19, Administrative Procedure and Texas Register Act
   9-20  (Article 6252-13a, Vernon's Texas Civil Statutes); and
   9-21              (2)  is under the substantial evidence rule.
   9-22        (o)  If the court sustains the occurrence of the violation,
   9-23  the court may uphold or reduce the amount of the penalty and order
   9-24  the person to pay the full or reduced amount of the penalty.  If
   9-25  the court does not sustain the occurrence of the violation, the
   9-26  court shall order that no penalty is owed.
   9-27        (p)  When the judgment of the court becomes final, the court
   10-1  shall proceed under this subsection.  If the person paid the amount
   10-2  of the penalty and if that amount is reduced or is not upheld by
   10-3  the court, the court shall order that the appropriate amount plus
   10-4  accrued interest be remitted to the person.  The rate of the
   10-5  interest is the rate charged on loans to depository institutions by
   10-6  the New York Federal Reserve Bank, and the interest shall be paid
   10-7  for the period beginning on the date the penalty was paid and
   10-8  ending on the date the penalty is remitted.  If the person gave a
   10-9  supersedeas bond and if the amount of the penalty is not upheld by
  10-10  the court, the court shall order the release of the bond.  If the
  10-11  person gave a supersedeas bond and if the amount of the penalty is
  10-12  reduced, the court shall order the release of the bond after the
  10-13  person pays the amount.
  10-14        (q)  A penalty collected under this section shall be remitted
  10-15  to the comptroller for the deposit to the credit of the oil-field
  10-16  cleanup fund.
  10-17        (r)  All proceedings under this section are subject to the
  10-18  Administrative Procedure and Texas Register Act (Article 6252-13a,
  10-19  Vernon's Texas Civil Statutes).
  10-20        SECTION 2.  (a)  This Act takes effect September 1, 1993,
  10-21  except as provided by Subsection (b) of this section.
  10-22        (b)  Subchapter C, Chapter 211, Natural Resources Code, as
  10-23  added by this Act, takes effect January 1, 1994.
  10-24        (c)  The Railroad Commission of Texas shall adopt rules for
  10-25  the administration of Chapter 211, Natural Resources Code, as added
  10-26  by this Act, before December 1, 1993.
  10-27        SECTION 3.  The importance of this legislation and the
   11-1  crowded condition of the calendars in both houses create an
   11-2  emergency and imperative public necessity that the constitutional
   11-3  rule requiring bills to be read on three several days in each house
   11-4  be suspended, and this rule is hereby suspended.