Interpretation of OSHA's Standard for Process Safety Management of Highly Hazardous Chemicals, 31453-31457 [E7-10918]

Download as PDF Federal Register / Vol. 72, No. 109 / Thursday, June 7, 2007 / Rules and Regulations to warrant application of the consultation provisions of Executive Orders 12372 and 13132. DEPARTMENT OF LABOR Executive Order 12866 This amendment is exempt from review under Executive Order 12866, but has been reviewed internally by the Department of State to ensure consistency with the purposes thereof. Paperwork Reduction Act This rule does not impose any new reporting or recordkeeping requirements subject to the Paperwork Reduction Act, 44 U.S.C. Chapter 35. List of Subjects in 22 CFR Part 121 Arms and munitions, Exports, U.S. Munitions List. I Accordingly, for the reasons set forth above, Title 22, Chapter I, Subchapter M, part 121 is amended as follows: PART 121—THE UNITED STATES MUNITIONS LIST 1. The authority citation for part 121 continues to read as follows: I Authority: Secs. 2, 38, and 71, Pub. L. 90– 629, 90 Stat. 744 (22 U.S.C. 2752, 2778, 2797); E.O. 11958, 42 FR 4311; 3 CFR, 1977 Comp., p. 79; 22 U.S.C. 2651a; Pub. L. 105– 261, 112 Stat. 1920. 2. Section 121.1 is amended in paragraph (c) by revising paragraph (e), Note (1)(i) and (ii) of Category VIII— Aircraft and Associated Equipment to read as follows: I § 121.1 General. The United States Munitions List. * * * * * Category VIII—Aircraft and Associated Equipment * * * (e) * * * * * Note: (1) * * * (i) Are integrated into and included as an integral part of a commercial primary or commercial standby instrument system for use on civil aircraft prior to export or exported solely for integration into such a commercial primary or standby instrument system, and (ii) When the exporter has been informed in writing by the Department of State that a specific quartz rate sensor integrated into a commercial primary or standby instrument system has been determined to be subject to the licensing jurisdiction of the Department of Commerce in accordance with this section. rwilkins on PROD1PC63 with RULES * * * * * Dated: March 26, 2007. John C. Rood, Assistant Secretary for International Security and Nonproliferation, Department of State. [FR Doc. E7–11012 Filed 6–6–07; 8:45 am] BILLING CODE 4710–25–P VerDate Aug<31>2005 17:11 Jun 06, 2007 Jkt 211001 31453 A. Introduction Occupational Safety and Health Administration The meaning of ‘‘on site in one location’’ was at issue in a recent case before the Occupational Safety and Health Review Commission. Motiva Enterprises, 21 BNA OSHC 1696 (OSHRC No. 02–2160, 2006). In that decision the Review Commission queried whether that language was meant to limit in some way the applicability of the standard to a highlyhazardous-chemical process. In the absence of an authoritative interpretation, the Review Commission decided it could not determine that the cited activities were ‘‘on site’’ and ‘‘in one location,’’ and it vacated the citations. Recognizing that OSHA is the policymaking actor under the Occupational Safety and Health Act, it left it to the agency to decide ‘‘in the first instance * * * the meaning of these terms and offer an ‘authoritative interpretation.’ ’’ It also said that ‘‘[a]ny such subsequent interpretation’’ would be reviewed in a future case ‘‘under ‘standard deference principles.’ ’’ The PSM standard provides, in pertinent part: 29 CFR Part 1910 Interpretation of OSHA’s Standard for Process Safety Management of Highly Hazardous Chemicals Occupational Safety and Health Administration (OSHA), Labor. ACTION: Interpretation. AGENCY: SUMMARY: This Notice constitutes the Occupational Safety and Health Administration’s official interpretation and explanation of the phrase ‘‘on site in one location’’ in the ‘‘Application’’ section of OSHA’s Process Safety Management of Highly Hazardous Chemicals standard. (‘‘PSM’’). DATES: Effective Date: June 7, 2007. FOR FURTHER INFORMATION CONTACT: For general information contact: Kevin Ropp, Director, Office of Communications, U.S. Department of Labor, Occupational Safety and Health Administration, Room N–3647, 200 Constitution Avenue, NW., Washington, DC 20210; telephone: (202) 693–1999; fax (202) 693–1635. For technical information contact: Mike Marshall, PSM Coordinator, Directorate of Enforcement Programs, U.S. Department of Labor, Occupational Safety and Health Administration, Room N–3119, 200 Constitution Avenue, NW., Washington, DC 20210; telephone: (202) 693–1850; fax (202) 693–1681. SUPPLEMENTARY INFORMATION: This Federal Register Notice addresses OSHA’s interpretation of the term ‘‘on site in one location’’ in the scope and application section of the PSM standard. As set forth below, OSHA interprets this term to mean that the standard applies when a threshold quantity (TQ) of a highly hazardous chemical (HHC) exists within contiguous areas under the control of an employer, or group of affiliated employers, in any group of vessels that are interconnected, or in separate vessels that are located in such proximity that the HHC could be involved in a potential catastrophic release, as indicated in the regulatory definition of ‘‘process.’’ 1 1 The term ‘‘contiguous’’ has been found to mean either ‘‘nearby’’ or ‘‘in actual contact’’ in terms of the application of an OSHA standard. Empire Company, Inc., 17 BNA OSHC 1990 (Docket No. 93–1861, 1997), affirmed 136 F.3d 873 (1st Cir. 1998). See also 136 F.3d at 878, citing Black’s Law Dictionary 320 (6th ed. 1990) (‘‘In close proximity; neighboring * * *’’). References to ‘‘contiguous’’ areas in this Notice carry the same meaning. PO 00000 Frm 00017 Fmt 4700 Sfmt 4700 (a) Application. (1) This section applies to the following: (i) A process which involves a chemical at or above the specified threshold quantities listed in appendix A to this section; (ii) A process which involves a flammable liquid or gas (as defined in § 1910.1200(c) of this part) on site in one location, in a quantity of 10,000 pounds (4535.9 kg) or more * * * ., 29 CFR 1910.119(a). The standard defines ‘‘process’’ to mean: * * * any activity involving a highly hazardous chemical including any use, storage, manufacturing, handling, or the onsite movement of such chemicals, or combination of these activities. For purposes of this definition, any group of vessels which are interconnected and separate vessels which are located such that a highly hazardous chemical could be involved in a potential release shall be considered a single process., 29 CFR 1910.119(b). The standard defines ‘‘highly hazardous chemical’’ to mean: * * *a substance possessing toxic, reactive, flammable, or explosive properties and specified by paragraph (a)(1) of this section. Ibid. The standard thus provides regulatory definitions for the application provision’s key terms, ‘‘process’’ and ‘‘highly hazardous chemical.’’ It omits, however, any definition for the phrase ‘‘on site in one location’’ that is E:\FR\FM\07JNR1.SGM 07JNR1 31454 Federal Register / Vol. 72, No. 109 / Thursday, June 7, 2007 / Rules and Regulations included in subsection (a)(1)(ii) of the Application provision. In providing this Notice’s clarification of the intended coverage of the standard, OSHA has determined that, considering the history, language, structure and purposes of the PSM standard, it is abundantly clear that there is considerable overlap between the term ‘‘on site in one location’’ and the definition of ‘‘process’’ adopted in the final version of the standard. In addition, ‘‘on site in one location’’ serves the independent function of excluding coverage where the HHC threshold would be met only if all amounts in interconnected or proximate vessels or pipes were aggregated but some of the amounts needed to meet the threshold quantity are outside the perimeter of the employer’s facility. For example, trucks and pipelines outside the boundaries of the employer’s property, which may be regulated by the Department of Transportation in any event, are excluded. B. The Regulatory History 1. Notice of Proposed Rulemaking, July 17, 1990 (NPRM) rwilkins on PROD1PC63 with RULES In response to several major disasters in both the United States and abroad, OSHA began to develop a comprehensive standard addressing hazards related to releases of HHCs in the workplace. On July 17, 1990, OSHA published a Notice of Proposed Rulemaking (NPRM) at 55 FR 29150. Approximately four months later (November 15, 1990), Section 304 of the Clean Air Act Amendments (CAAA) of 1990, Public Law 101–549, required the Secretary of Labor, in coordination with the Administrator of the Environmental Protection Agency, to promulgate, pursuant to the Occupational Safety and Health Act of 1970, a chemical process safety standard to prevent accidental releases of hazardous chemicals that could pose a threat to employees. The Act also directed EPA to issue a rule addressing the hazards to the public of releases of such chemicals into the atmosphere and to coordinate the provisions with comparable OSHA requirements, (42 U.S.C. 7412(r)(7)). The NPRM’s scope and application section included the following statement of the standard’s intended application: (b) Application. (1) This section applies to the following* * * (i) Processes* * * (ii) Processes which involve flammable liquids or gases (as defined in § 1910.1200(c) of this part) onsite in one location in quantities of 10,000 lbs or more* * *, 55 FR 29163. VerDate Aug<31>2005 17:11 Jun 06, 2007 Jkt 211001 Under the proposal the term ‘‘process’’ would be defined as: * * *any activity conducted by an employer that involves a highly hazardous chemical including any use, storage, manufacturing, handling, or movement of a highly hazardous chemical, or a combination of these activities. Ibid. Thus, the NPRM applied to processes in the plural, and the definition of ‘‘process’’ did not include any language indicating a geographic limit to what constituted a covered ‘‘activity.’’ The subsection on application to flammable liquids and gases included ‘‘on site in one location,’’ without explaining the phrase. The subsection on application to listed hazardous chemicals lacked any parallel language. 2. The Rulemaking Record and Hearing Process In response to the NPRM, OSHA received over 175 written comments. OSHA’s review of the comments revealed a significant issue of how TQs of HHCs were to be calculated. Because OSHA had used the plural term ‘‘processes’’ in the NPRM, which could suggest multiple processes in separate locations, some stakeholders expressed concern as to whether OSHA intended TQs be calculated by an aggregate of all HHC present at an employer’s facility, or by the amount of an HHC present in one particular process. (See e.g., Exs. 3– 104, 109, 112, 119, 125, 126).2 Recognizing this confusion, OSHA, in a Federal Register notice of November 1, 1990,3 clarified its intent that TQs would be calculated by process or location, and not on a facility-wide basis: OSHA did not intend that facilities aggregate quantities of covered chemicals. The important factor is the amount of a listed chemical in a plant that could be released at one point in time. If the total amount of a listed chemical in a plant exceeds its threshold quantity of 1000 pounds, for example, but the chemical is used in small quantities around the plant and is not concentrated in one process or in one area, OSHA believes that a catastrophic release of the entire material would be unlikely. 55 FR 46074, 46075) (emphasis added). At hearings on the proposal held in Washington, DC and Houston, TX, and in additional written comments, stakeholders almost uniformly accepted OSHA’s explanation of its intent that TQs of HHCs were to be calculated by 2 All citations to either exhibits or transcripts in this instruction are references to the PSM Standard’s Rulemaking Docket, No. S026, available at https://www.regulations.gov. 3 This Federal Register notice also announced additional hearings in Houston, TX. PO 00000 Frm 00018 Fmt 4700 Sfmt 4700 individual process and not through aggregation of all processes present in a facility. Several major trade associations and refinery employers concurred with OSHA’s conclusions, (Tr. 1113, 2591– 92, 3038, 3419, 3192; Exs. 3–165, 3– 170). Commenters urged that this aggregation principle should apply regardless of the type of HHC, (e.g., Tr. 1113, 3038, 3192; Ex.–109). In addition, during the rulemaking, commenters noted that HHCs concentrated in a single interconnected process should be subject to the requirements of the PSM standard, (Ex. 3–165, 3–166). The concept of interconnectedness was integral to American Petroleum Institute (API) 750, Management of Process Hazards, an industry consensus document on managing process hazards. This was one of the industry practices OSHA referenced when developing the PSM Standard, (55 FR 29159). Specifically, API 750 defined a ‘‘facility’’ and ‘‘process’’ as follows: 1.4.4 A facility comprises the buildings, containers, and equipment that could reasonably be expected to participate in a catastrophic release as a result of their being physically interconnected or of their proximity and in which dangerous chemicals are used, stored, manufactured, handled, or moved. 1.4.5 Process refers to the activities that constitute use, storage, manufacture, handling, or movement in all facilities that contain dangerous substances. 3. The Final Rule On February 24, 1992, OSHA promulgated the final PSM standard, (57 FR 6356). With respect to TQ calculations, OSHA again reiterated its November 1, 1990 statement of intent, noting that it ‘‘continues to believe that the potential of a catastrophic release exists when a highly hazardous chemical is concentrated in a process.’’ OSHA also stated that it ‘‘agrees with those commenters’’ who argued that ‘‘highly hazardous chemicals in less than threshold quantities distributed in several processes would not present as great a risk of catastrophe as the threshold quantity in a single process.’’ (57 FR 6364). To reflect its agreement with the commenters and API 750 on this point, OSHA modified the definition of ‘‘process’’ in the final rule. First, the ‘‘Application’’ provision was stated in terms of a ‘‘process’’ rather than ‘‘processes.’’ Next, as set forth above, the final standard augmented the NPRM’s definition of ‘‘process’’ by adding language to clarify that ‘‘interconnected and nearby vessels containing a highly hazardous chemical would be considered part of the single E:\FR\FM\07JNR1.SGM 07JNR1 Federal Register / Vol. 72, No. 109 / Thursday, June 7, 2007 / Rules and Regulations process and the quantities of the chemical would be aggregated to determine if the threshold quantity of the chemical is exceeded’’. Id., at 6372 (emphasis added). OSHA also added the term ‘‘on-site movement’’ to the list of covered activities. Finally, OSHA specifically stated that the term ‘‘process,’’ when used in conjunction with the application section of the standard, establishes the intent of the standard, (57 FR 6372). As a result, OSHA intended that the term ‘‘process’’ be read in conjunction with the terms ‘‘on site in one location’’ when evaluating the applicability of PSM. There was no further preamble discussion, however, on what, if anything, ‘‘on site in one location’’ was meant to convey. The regulatory history establishes several key points. First, OSHA intended ‘‘process’’ to be the central term elucidating the standard’s coverage. Second, employers need not aggregate all amounts of a chemical in an entire facility to determine whether a threshold quantity is present. Instead, only amounts in a group of vessels that are interconnected, or in vessels that are separate but sufficiently close together that they could be involved in the same release, are to be aggregated. Finally, the agency intended no distinction in the application of these principles between listed chemicals subject to 29 CFR 1910.119(a)(i) and flammables subject to 29 CFR 1910.119(a)(ii). rwilkins on PROD1PC63 with RULES 4. The Environmental Protection Agency (EPA) Risk Management Program (RMP) In addition to directing OSHA to develop the PSM standard, Congress directed EPA to address the hazards of catastrophic releases of highly hazardous chemicals to the atmosphere, (42 U.S.C. 7412(r)). EPA issued its rule on June 20, 1996, following promulgation of OSHA’s PSM standard, (61 FR 31667). While the definition of ‘‘process’’ in the EPA-prescribed RMP is identical to the PSM definition, RMP does not use the term ‘‘on site in one location’’. Instead, RMP uses the term ‘‘stationary source,’’ which is defined, in relevant part, as ‘‘any buildings, structures, equipment, installations, or substance emitting stationary activities which belong to the same industrial group, which are located on one or more contiguous properties, which are under the control of the same person (or persons under common control), and from which an accidental release may occur.’’ (40 CFR 68.3). This is the same definition used by Congress. (42 U.S.C.A 7412(r)(2)(c)). VerDate Aug<31>2005 17:11 Jun 06, 2007 Jkt 211001 C. The Regulatory Language and Structure As noted above, the Secretary construes the phrase ‘‘on site in one location’’ to refer to contiguous areas under the control of an employer, or group of affiliated employers, and, within that area to a group of vessels that are interconnected, or separate but sufficiently near each other that they could be involved in a catastrophic release. This interpretation accords with the ordinary dictionary meanings of ‘‘site’’ and ‘‘location’’ and with the context of the entire application provision and the related regulatory definitions for ‘‘process’’ and ‘‘highly hazardous chemical.’’ In interpreting the phrase, moreover, the Secretary has concluded that to give meaning to all the words of the standard, a certain degree of redundancy is inevitable; and that it would not be faithful to the drafters’ intent or the purposes of the standard to construe ‘‘on site in one location’’ as completely separate from the definition of ‘‘process,’’ since the result would be to read part of the ‘‘process’’ definition out of the standard altogether. In so concluding, the Secretary notes that the overlap of ‘‘process’’ with ‘‘on site in one location’’ parallels a similar overlap with ‘‘highly hazardous chemical,’’ as the latter term appears both in the ‘‘process’’ definition and in the language of the application provision and its definition includes a reference back to the application provision. Thus, the standard applies to a process, a process is an activity involving a highly hazardous chemical, and a highly hazardous chemical is, inter alia, a chemical that is specified by the standard’s application provision, 29 CFR 1910.119(a), (b). But, despite this evident circularity, nobody has ever objected to that overlap. Similarly, there is unavoidable overlap between ‘‘on site in one location’’ and the portions of the process definition that refer to interconnection and location. The interpretation provided here is consistent with the ordinary dictionary meaning of ‘‘on site in one location.’’ The dictionary defines ‘‘site’’ to mean, primarily, ‘‘the position or location of a town, building, etc., esp. as to its environment.’’ Webster’s Unabridged Dictionary 1128, 1788 (2d ed. 2001). It defines ‘‘location’’ to mean, primarily, ‘‘a place or situation occupied.’’ See also American Heritage Dictionary (1976), 1210 (defining ‘‘site’’ as ‘‘the place or plot of land where something was or is to be located’’ ), 765 (defining ‘‘location’’ to mean ‘‘a place where something is or might be located; a site or situation’’); Black’s Law Dictionary PO 00000 Frm 00019 Fmt 4700 Sfmt 4700 31455 (7th ed. 1999), at 1392 (‘‘site’’ means ‘‘a place or location; esp., a piece of property set aside for a specific use’’), at 951 (‘‘location’’ means ‘‘the specific place or position of a person or thing’’). That ‘‘site’’ and ‘‘location’’ are virtually synonyms provides further support for the conclusion that avoiding redundancy was not uppermost in the minds of the drafters. Read together, however, they reinforce the idea that OSHA intended to give ‘‘highly hazardous chemical’’ and ‘‘process’’ a rough geographical, as well as functional, limit. This intent may be further discerned from consideration of relevant regulatory history. CAAA Section 304 directed the Secretary, in coordination with EPA, to promulgate a chemical process safety standard designed to protect employees from hazards associated with accidental releases of HHCs in the workplace. Although EPA’s RMP Rule at 40 CFR part 68 et seq. does not contain an ‘‘on site’’ (or ‘‘in one location’’) limitation in its text, Congress’s defining EPA coverage in terms of a ‘‘stationary source’’ accomplishes the same limitation. ‘‘Stationary source’’ is defined as any buildings, structures, equipment, installations or substance emitting stationary activities (i) which belong to the same industrial group, (ii) which are located on one or more contiguous properties, (iii) which are under the control of the same person (or persons under common control), and (iv) from which an accidental release may occur, (42 U.S.C.A § 7412(r)(2)(c)).4 Because Congress mandated OSHA and EPA coordination in addressing the release of hazardous substances, the regulations of the two agencies are to be construed together. In other words, the boundaries of a covered facility under PSM will be similar to the boundaries of a stationary source under RMP, and ‘‘on site in one location’’ is given essentially the same meaning as the ‘‘which are located on one or more contiguous properties’’ component of the term ‘‘stationary source,’’ while the rest of the definition mirrors OSHA’s definition of ‘‘process.’’ Just as that term encompasses most of the PSM ‘‘process’’ definition, this construction of ‘‘on site in one location’’ also encompasses the inclusion of the ‘‘on-site movement’’ of HHCs that was added to the definition of ‘‘process’’ in the final rule. Although neither the NPRM nor the preamble to the final rule provides any detailed explanation of this inclusion, it would be consistent with the statutory aims of the CAAA to 4 This term was directly adopted into RMP at 40 CFR 68.3. E:\FR\FM\07JNR1.SGM 07JNR1 rwilkins on PROD1PC63 with RULES 31456 Federal Register / Vol. 72, No. 109 / Thursday, June 7, 2007 / Rules and Regulations limit PSM coverage to facilities included in the ‘‘stationary source’’ definition. To that end, the Secretary also reads the limitation in ‘‘stationary source’’ to locations ‘‘ which are under the control of the same person (or persons under common control)’’ as being implicit in the phrase ‘‘on site in one location’’ and, indeed, in the definition of ‘‘process’’ (since the former phrase only relates explicitly to flammable liquids and gases, and not to Appendix A toxic substances). This construction also comports with the regulatory history on aggregating the TQs of HHCs. As noted in the comments of stakeholders, ‘‘on site in one location’’ could not be naturally read with the plural term ‘‘processes’’ in proposed § 1910.119(b)(1)(ii). A large facility can have separate processes at different locations within its boundaries, a point raised by Allied Signal in its comments (Ex. 3–17). The American Paper Institute similarly commented that ‘‘a significant concern for us is that the proposed rule is unclear as to how an employer can determine when the rule would apply to a particular facility handling chemicals at different locations of that facility.’’ (Tr. 1112). Not only did the stakeholders point out that the NPRM’s scope and application section was inconsistent with the proposed definition of ‘‘process,’’ OSHA itself recognized the issue and took the unusual step of clarifying its intent in an interim proposal document. By stating that a chemical used in small quantities around the plant and not concentrated in one process or in one area would be unlikely to cause a catastrophic release, OSHA clearly sought to limit coverage of the PSM standard to situations where a TQ of an HHC was concentrated in a single, including an interconnected, process. Despite the inexact use of the plural ‘‘processes’’ in the NPRM, it was never the agency’s intent to cover HHCs sufficiently dispersed in various locations on a large site, and in more than one process, such that their release from any one process would not cause the type of catastrophic harm that this standard was aimed to prevent. The use of ‘‘on site in one location’’ in the provision regarding flammables was intended to signal that employers would not need to aggregate all sources of the chemical facility-wide, or those outside the bounds of the employers’ facility, although the provision did not clearly describe the agency’s intent regarding which sources should be aggregated. The hearing transcripts and written comments confirm that members of the refinery industry, an industry with a VerDate Aug<31>2005 17:11 Jun 06, 2007 Jkt 211001 particular interest in OSHA’s regulation of flammable liquids and gases, understood and accepted OSHA’s clarified position. For instance, Shell Oil Company testified that it ‘‘strongly supports OSHA’s position that owners should not aggregate quantities of chemicals at separate locations across a facility to determine if threshold quantities have been reached’’, (Tr. 2591). BP testified that ‘‘if flammables are over 10,000 pounds in process, the rule applies to that process’’, (Tr. 3038). Amoco Corporation agreed that ‘‘OSHA clarified that the threshold quantities of highly hazardous chemicals are determined on process basis, rather than by aggregating quantities of like chemicals for an entire facility’’, (Ex. 3– 165). Union Carbide similarly stated its understanding that ‘‘all of the thresholds be calculated on a ‘per process’ basis’’, (Ex. 3–109). OSHA reiterated this position in the final rule, stating that it ‘‘continues to believe that the potential hazard of a catastrophic release exists when the highly hazardous chemical is concentrated in a single process’’, (57 FR 6364). This was in agreement with those stakeholders who argued that TQs should not be aggregated over an entire facility, (e.g., Tr. 2591, 3192; Exs. 3–163, 3–164). OSHA’s final position was that PSM coverage could only be found if a TQ of an HHC exists in a single process. To the extent ‘‘on site in one location’’ did not adequately convey that intent, the more precise revision of the definition of ‘‘process’’ as a result of the record comments did so by clarifying that the standard’s scope was meant to apply to an area more confined than multiple processes, but more expansive than a single process point, where the process involves inter-connecting vessels or pipes, or vessels in close proximity such that the release of an HHC in one could trigger a chain reaction in the others. Accordingly, OSHA modified the definition of ‘‘process’’ to include the concepts of ‘‘interconnection’’ and ‘‘co-location’’ with addition of the language, ‘‘any group of vessels which are interconnected or separate vessels which are located such that a highly hazardous chemical could be involved in a potential release shall be considered a single process.’’ 29 CFR 1910.119(b). OSHA stated in the final rule that this definition, when read in conjunction with the application section, establishes the standard’s intended coverage, (57 FR 6372). Therefore, a ‘‘single process’’ containing a TQ of an HHC includes an ‘‘interconnected’’ or closely co-located process. PO 00000 Frm 00020 Fmt 4700 Sfmt 4700 D. The Regulatory Purpose Construing ‘‘on site in one location’’ in tandem with the final, expanded definition of ‘‘process’’ also serves OSHA’s intended purposes. First, the full definition of ‘‘process’’ makes clear that it was not OSHA’s intent that it would be required to prove that a release of an HHC in one component of an interconnected process could affect a release in other components of the same interconnected process in order for the PSM standard to apply. Rather, the intent of OSHA and the understanding of the stakeholders were to the contrary, as the rulemaking record indicates. For example, AT&T recommended that OSHA define threshold quantity as ‘‘the maximum amount in pounds in a process (or connected processes)’’, (Ex. 3–126). Asarco, in its comments, suggested that an interconnected process should be covered by the PSM standard. (Ex. 3–125). API, the leading trade organization of the refinery industry, included the concept of interconnection in its Recommended Practice 750. As described supra, API 750 applied to ‘‘facilities’’ that use, produce, process or store flammable or explosive substances that are present in such quantity and condition that a sudden, catastrophic release of more than five tons of gas or vapor can occur over a matter of minutes, based on credible failure scenarios and the properties of the materials involved, (API 750 1.3.1.1(a)).5 The term ‘‘facilities’’, as used in API 750, includes buildings, containers, and equipment that are physically interconnected, (see API 750 1.4.4). The presence of the word ‘‘or’’ between interconnected and co-located vessels in the final rule demonstrates that two potential avenues exist to find a covered process when several aspects may be involved in the overall process. The plain language of the definition establishes two distinct burdens of proof when considering the applicability of PSM to an interconnected or a colocated process. With respect to a colocated process, OSHA would be required to demonstrate as part of its prima facie case that unconnected but co-located processes are situated in a manner that a release from one process could contribute to the release of the other. In contrast, the definition of ‘‘process’’ contains no such requirement for an interconnected process. In other words, OSHA’s intent is that the phrase ‘‘which are located such that a highly 5 In the final rule, OSHA rejected API’s TQ of 5 tons of released flammable vapor as too complex, using instead the 10,000 pounds TQ. 57 FR at 6366– 67. E:\FR\FM\07JNR1.SGM 07JNR1 rwilkins on PROD1PC63 with RULES Federal Register / Vol. 72, No. 109 / Thursday, June 7, 2007 / Rules and Regulations hazardous chemical could be involved in a potential release’’ modifies only the immediately-preceding ‘‘separate vessels,’’ making the entire phrase parallel to the free-standing phrase ‘‘any group of vessels which are interconnected.’’ Thus, there is no additional requirement on OSHA to show the potentiality of a release with respect to interconnected (as opposed to separate) vessels. Rather, the PSM standard presumes that all aspects of a physically connected process can be expected to participate in a catastrophic release. Second, it is clear that, in revising the ‘‘process’’ definition to encompass the ‘‘on-site movement’’ of HHCs and the twin concepts of inter-connectedness and co-location, OSHA intended that definition to bear most of the weight of defining the scope of the standard. As originally drafted, the ‘‘process’’ definition not only did not have these clarifications, but ‘‘onsite in one location’’ appeared only in the subsection on flammable liquids and gases, and not in the subsection on Appendix A toxic substances. There is no obvious explanation why this was so. As noted, the phrase was intended to signal that it was not necessary to aggregate all sources of a chemical within, or beyond, the employer’s facility. The final standard clarified and more precisely stated this intent and made clear that the same principles applied to both listed and flammable chemicals. The phrase in the final standard continues to carry its original NPRM meaning of setting a geographic boundary (‘‘on site’’) and, within that boundary, a site-specific parameter (‘‘in one location’’). But after the definition of ‘‘process’’ was changed in the final rule to include explicit language clarifying that a ‘‘single process’’ includes ‘‘any group of vessels which are interconnected or separate vessels which are located such that a highly hazardous chemical could be involved in a potential release,’’ the limitation placed on application of the standard to flammable liquids and gases denoted by the related phrase ‘‘on site in one location’’ no longer carries the independent weight it had before OSHA clarified the intended meaning of ‘‘process.’’ As previously stated, however, it continues to serve a separate purpose by operating to exclude coverage where the HHC threshold would be met only if all amounts in interconnected or co-located vessels were aggregated but some of the amounts needed to meet the threshold quantity are outside of the perimeter of the employer’s facility. VerDate Aug<31>2005 17:11 Jun 06, 2007 Jkt 211001 E. The Response to the Motiva Decision In the Motiva decision, the Review Commission appropriately left to the Secretary the task of interpreting ‘‘on site in one location’’ as it appears in the PSM standard, rather than doing so as an initial matter on its own. This Notice accomplishes that function. The interpretation set forth here is supported by the language, history and purposes of the standard and is consistent with the position adopted by EPA. In the absence of an agency interpretation, the Review Commission had focused on another guide to regulatory intent, the canon of construction that says that all the words of a statute (or regulation) should be assumed to have their own meaning, and suggested that ‘‘on site in one location’’ therefore has a meaning wholly apart from process. Regardless of the strength of this canon, the Secretary has satisfied it here by interpreting ‘‘on site in one location’’ to limit coverage to vessels within contiguous areas controlled by an employer or group of affiliated employers. More fundamentally, the Secretary agrees that canons of construction can be useful guides to regulatory intent. They are guides only, however, and should not be mechanically applied in the face of stronger indicia of intent. The flip side of the canon referred to above is the rule that the words of a standard (or regulation) should not be given meaning at the expense of rendering other words meaningless. Accordingly, the courts have put aside the general rule against redundancy in statutes if applying the rule would be counter to legislative intent. See Gutierrez v. Ada, 528 U.S. 250, 258 (2000) (‘‘rule against redundancy does not necessarily have the strength to turn a tide of good cause to come out the other way’’); Morton v. United Parcel Service, Inc., 272 F.3d 1249, 1258 (9th Cir. 2001) (rule of redundancy not followed when intent of statute clear); Mayer v. Spanel Intern. LTD., 51 F.3d 670, 674 (7th Cir. 1995) (every enacted word need not carry independent force absent strong evidence that at the time of enactment the words were understood as equivalents). In this case, the general statutory canon against redundancy cannot be given controlling weight given the clear intent of OSHA, in the final rule, and the stakeholders, through their comments, during the regulatory process. To do otherwise, in the Secretary’s judgment, would render meaningless the most important revision affecting coverage that came out of the rulemaking process, namely the explicit inclusion of the twin concepts of interconnection and co- PO 00000 Frm 00021 Fmt 4700 Sfmt 4700 31457 location in the definition of ‘‘process’’ and the clear intent that those concepts would determine coverage under the standard. Moreover, it is simply linguistically inescapable that there is overlap and redundancy among the terms of the standard. Motiva involved the interplay between ‘‘on site in one location’’ and the ‘‘interconnected’’ prong of the definition of ‘‘process,’’ but the other prong of that definition refers to vessels that are so ‘‘located’’ to create a risk of catastrophic release. Similarly, the appearance of ‘‘highly hazardous chemical’’ in the definition of ‘‘process’’ and in the application provision, and the reference back to the application section in the HHC definition, creates an unavoidable redundancy. So too here, the Secretary cannot reasonably interpret ‘‘on site in one location’’ in a way that has no overlap with ‘‘process.’’ Instead, consistent with how courts generally apply the canons of construction, she has settled on an interpretation of the term ‘‘on site in one location’’ that conforms as much as possible to the ordinary meaning of the words and to the standard’s overall language, history, and purposes. Signature This document was prepared under the direction of Edwin G. Foulke, Jr., Assistant Secretary of Labor for Occupational Safety and Health, U.S. Department of Labor, 200 Constitution Avenue, NW., Washington, DC 20210. Signed at Washington, DC, this 1st day of June, 2007. Edwin G. Foulke, Jr., Assistant Secretary of Labor for Occupational Safety and Health. [FR Doc. E7–10918 Filed 6–6–07; 8:45 am] BILLING CODE 4510–26–P ENVIRONMENTAL PROTECTION AGENCY 40 CFR Part 52 [EPA–R06–OAR–2007–0386; FRL–8321–7] Approval and Promulgation of Air Quality Implementation Plans; Texas; Revision to the Texas State Implementation Plan Regarding a Negative Declaration for the Synthetic Organic Chemical Manufacturing Industry Batch Processing Source Category in El Paso County Environmental Protection Agency (EPA). ACTION: Direct final rule. AGENCY: SUMMARY: Section 172(c)(1) of the Clean Air Act (CAA) requires areas that are not E:\FR\FM\07JNR1.SGM 07JNR1

Agencies

[Federal Register Volume 72, Number 109 (Thursday, June 7, 2007)]
[Rules and Regulations]
[Pages 31453-31457]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E7-10918]


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DEPARTMENT OF LABOR

Occupational Safety and Health Administration

29 CFR Part 1910


Interpretation of OSHA's Standard for Process Safety Management 
of Highly Hazardous Chemicals

AGENCY: Occupational Safety and Health Administration (OSHA), Labor.

ACTION: Interpretation.

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SUMMARY: This Notice constitutes the Occupational Safety and Health 
Administration's official interpretation and explanation of the phrase 
``on site in one location'' in the ``Application'' section of OSHA's 
Process Safety Management of Highly Hazardous Chemicals standard. 
(``PSM'').

DATES: Effective Date: June 7, 2007.

FOR FURTHER INFORMATION CONTACT: For general information contact: Kevin 
Ropp, Director, Office of Communications, U.S. Department of Labor, 
Occupational Safety and Health Administration, Room N-3647, 200 
Constitution Avenue, NW., Washington, DC 20210; telephone: (202) 693-
1999; fax (202) 693-1635. For technical information contact: Mike 
Marshall, PSM Coordinator, Directorate of Enforcement Programs, U.S. 
Department of Labor, Occupational Safety and Health Administration, 
Room N-3119, 200 Constitution Avenue, NW., Washington, DC 20210; 
telephone: (202) 693-1850; fax (202) 693-1681.

SUPPLEMENTARY INFORMATION: This Federal Register Notice addresses 
OSHA's interpretation of the term ``on site in one location'' in the 
scope and application section of the PSM standard. As set forth below, 
OSHA interprets this term to mean that the standard applies when a 
threshold quantity (TQ) of a highly hazardous chemical (HHC) exists 
within contiguous areas under the control of an employer, or group of 
affiliated employers, in any group of vessels that are interconnected, 
or in separate vessels that are located in such proximity that the HHC 
could be involved in a potential catastrophic release, as indicated in 
the regulatory definition of ``process.'' \1\
---------------------------------------------------------------------------

    \1\ The term ``contiguous'' has been found to mean either 
``nearby'' or ``in actual contact'' in terms of the application of 
an OSHA standard. Empire Company, Inc., 17 BNA OSHC 1990 (Docket No. 
93-1861, 1997), affirmed 136 F.3d 873 (1st Cir. 1998). See also 136 
F.3d at 878, citing Black's Law Dictionary 320 (6th ed. 1990) (``In 
close proximity; neighboring * * *''). References to ``contiguous'' 
areas in this Notice carry the same meaning.
---------------------------------------------------------------------------

A. Introduction

    The meaning of ``on site in one location'' was at issue in a recent 
case before the Occupational Safety and Health Review Commission. 
Motiva Enterprises, 21 BNA OSHC 1696 (OSHRC No. 02-2160, 2006). In that 
decision the Review Commission queried whether that language was meant 
to limit in some way the applicability of the standard to a highly-
hazardous-chemical process. In the absence of an authoritative 
interpretation, the Review Commission decided it could not determine 
that the cited activities were ``on site'' and ``in one location,'' and 
it vacated the citations. Recognizing that OSHA is the policymaking 
actor under the Occupational Safety and Health Act, it left it to the 
agency to decide ``in the first instance * * * the meaning of these 
terms and offer an `authoritative interpretation.' '' It also said that 
``[a]ny such subsequent interpretation'' would be reviewed in a future 
case ``under `standard deference principles.' ''
    The PSM standard provides, in pertinent part:

    (a) Application. (1) This section applies to the following:
    (i) A process which involves a chemical at or above the 
specified threshold quantities listed in appendix A to this section;
    (ii) A process which involves a flammable liquid or gas (as 
defined in Sec.  1910.1200(c) of this part) on site in one location, 
in a quantity of 10,000 pounds (4535.9 kg) or more * * * .,

29 CFR 1910.119(a).

The standard defines ``process'' to mean:

* * * any activity involving a highly hazardous chemical including 
any use, storage, manufacturing, handling, or the on-site movement 
of such chemicals, or combination of these activities. For purposes 
of this definition, any group of vessels which are interconnected 
and separate vessels which are located such that a highly hazardous 
chemical could be involved in a potential release shall be 
considered a single process.,

29 CFR 1910.119(b).

The standard defines ``highly hazardous chemical'' to mean:

    * * *a substance possessing toxic, reactive, flammable, or 
explosive properties and specified by paragraph (a)(1) of this 
section.

Ibid.

The standard thus provides regulatory definitions for the application 
provision's key terms, ``process'' and ``highly hazardous chemical.'' 
It omits, however, any definition for the phrase ``on site in one 
location'' that is

[[Page 31454]]

included in subsection (a)(1)(ii) of the Application provision.
    In providing this Notice's clarification of the intended coverage 
of the standard, OSHA has determined that, considering the history, 
language, structure and purposes of the PSM standard, it is abundantly 
clear that there is considerable overlap between the term ``on site in 
one location'' and the definition of ``process'' adopted in the final 
version of the standard. In addition, ``on site in one location'' 
serves the independent function of excluding coverage where the HHC 
threshold would be met only if all amounts in interconnected or 
proximate vessels or pipes were aggregated but some of the amounts 
needed to meet the threshold quantity are outside the perimeter of the 
employer's facility. For example, trucks and pipelines outside the 
boundaries of the employer's property, which may be regulated by the 
Department of Transportation in any event, are excluded.

B. The Regulatory History

1. Notice of Proposed Rulemaking, July 17, 1990 (NPRM)

    In response to several major disasters in both the United States 
and abroad, OSHA began to develop a comprehensive standard addressing 
hazards related to releases of HHCs in the workplace. On July 17, 1990, 
OSHA published a Notice of Proposed Rulemaking (NPRM) at 55 FR 29150. 
Approximately four months later (November 15, 1990), Section 304 of the 
Clean Air Act Amendments (CAAA) of 1990, Public Law 101-549, required 
the Secretary of Labor, in coordination with the Administrator of the 
Environmental Protection Agency, to promulgate, pursuant to the 
Occupational Safety and Health Act of 1970, a chemical process safety 
standard to prevent accidental releases of hazardous chemicals that 
could pose a threat to employees. The Act also directed EPA to issue a 
rule addressing the hazards to the public of releases of such chemicals 
into the atmosphere and to coordinate the provisions with comparable 
OSHA requirements, (42 U.S.C. 7412(r)(7)).
    The NPRM's scope and application section included the following 
statement of the standard's intended application:

    (b) Application. (1) This section applies to the following* * *
    (i) Processes* * *
    (ii) Processes which involve flammable liquids or gases (as 
defined in Sec.  1910.1200(c) of this part) onsite in one location 
in quantities of 10,000 lbs or more* * *,

55 FR 29163.

    Under the proposal the term ``process'' would be defined as:

    * * *any activity conducted by an employer that involves a 
highly hazardous chemical including any use, storage, manufacturing, 
handling, or movement of a highly hazardous chemical, or a 
combination of these activities.

Ibid.

    Thus, the NPRM applied to processes in the plural, and the 
definition of ``process'' did not include any language indicating a 
geographic limit to what constituted a covered ``activity.'' The 
subsection on application to flammable liquids and gases included ``on 
site in one location,'' without explaining the phrase. The subsection 
on application to listed hazardous chemicals lacked any parallel 
language.

2. The Rulemaking Record and Hearing Process

    In response to the NPRM, OSHA received over 175 written comments. 
OSHA's review of the comments revealed a significant issue of how TQs 
of HHCs were to be calculated. Because OSHA had used the plural term 
``processes'' in the NPRM, which could suggest multiple processes in 
separate locations, some stakeholders expressed concern as to whether 
OSHA intended TQs be calculated by an aggregate of all HHC present at 
an employer's facility, or by the amount of an HHC present in one 
particular process. (See e.g., Exs. 3-104, 109, 112, 119, 125, 126).\2\
---------------------------------------------------------------------------

    \2\ All citations to either exhibits or transcripts in this 
instruction are references to the PSM Standard's Rulemaking Docket, 
No. S026, available at https://www.regulations.gov.
---------------------------------------------------------------------------

    Recognizing this confusion, OSHA, in a Federal Register notice of 
November 1, 1990,\3\ clarified its intent that TQs would be calculated 
by process or location, and not on a facility-wide basis:
---------------------------------------------------------------------------

    \3\ This Federal Register notice also announced additional 
hearings in Houston, TX.

    OSHA did not intend that facilities aggregate quantities of 
covered chemicals. The important factor is the amount of a listed 
chemical in a plant that could be released at one point in time. If 
the total amount of a listed chemical in a plant exceeds its 
threshold quantity of 1000 pounds, for example, but the chemical is 
used in small quantities around the plant and is not concentrated in 
one process or in one area, OSHA believes that a catastrophic 
---------------------------------------------------------------------------
release of the entire material would be unlikely.

55 FR 46074, 46075) (emphasis added).


At hearings on the proposal held in Washington, DC and Houston, TX, and 
in additional written comments, stakeholders almost uniformly accepted 
OSHA's explanation of its intent that TQs of HHCs were to be calculated 
by individual process and not through aggregation of all processes 
present in a facility. Several major trade associations and refinery 
employers concurred with OSHA's conclusions, (Tr. 1113, 2591-92, 3038, 
3419, 3192; Exs. 3-165, 3-170). Commenters urged that this aggregation 
principle should apply regardless of the type of HHC, (e.g., Tr. 1113, 
3038, 3192; Ex.-109).
    In addition, during the rulemaking, commenters noted that HHCs 
concentrated in a single interconnected process should be subject to 
the requirements of the PSM standard, (Ex. 3-165, 3-166). The concept 
of interconnectedness was integral to American Petroleum Institute 
(API) 750, Management of Process Hazards, an industry consensus 
document on managing process hazards. This was one of the industry 
practices OSHA referenced when developing the PSM Standard, (55 FR 
29159). Specifically, API 750 defined a ``facility'' and ``process'' as 
follows:

    1.4.4 A facility comprises the buildings, containers, and 
equipment that could reasonably be expected to participate in a 
catastrophic release as a result of their being physically 
interconnected or of their proximity and in which dangerous 
chemicals are used, stored, manufactured, handled, or moved.
    1.4.5 Process refers to the activities that constitute use, 
storage, manufacture, handling, or movement in all facilities that 
contain dangerous substances.

3. The Final Rule

    On February 24, 1992, OSHA promulgated the final PSM standard, (57 
FR 6356). With respect to TQ calculations, OSHA again reiterated its 
November 1, 1990 statement of intent, noting that it ``continues to 
believe that the potential of a catastrophic release exists when a 
highly hazardous chemical is concentrated in a process.'' OSHA also 
stated that it ``agrees with those commenters'' who argued that 
``highly hazardous chemicals in less than threshold quantities 
distributed in several processes would not present as great a risk of 
catastrophe as the threshold quantity in a single process.'' (57 FR 
6364).
    To reflect its agreement with the commenters and API 750 on this 
point, OSHA modified the definition of ``process'' in the final rule. 
First, the ``Application'' provision was stated in terms of a 
``process'' rather than ``processes.'' Next, as set forth above, the 
final standard augmented the NPRM's definition of ``process'' by adding 
language to clarify that ``interconnected and nearby vessels containing 
a highly hazardous chemical would be considered part of the single

[[Page 31455]]

process and the quantities of the chemical would be aggregated to 
determine if the threshold quantity of the chemical is exceeded''. Id., 
at 6372 (emphasis added). OSHA also added the term ``on-site movement'' 
to the list of covered activities. Finally, OSHA specifically stated 
that the term ``process,'' when used in conjunction with the 
application section of the standard, establishes the intent of the 
standard, (57 FR 6372). As a result, OSHA intended that the term 
``process'' be read in conjunction with the terms ``on site in one 
location'' when evaluating the applicability of PSM. There was no 
further preamble discussion, however, on what, if anything, ``on site 
in one location'' was meant to convey.
    The regulatory history establishes several key points. First, OSHA 
intended ``process'' to be the central term elucidating the standard's 
coverage. Second, employers need not aggregate all amounts of a 
chemical in an entire facility to determine whether a threshold 
quantity is present. Instead, only amounts in a group of vessels that 
are interconnected, or in vessels that are separate but sufficiently 
close together that they could be involved in the same release, are to 
be aggregated. Finally, the agency intended no distinction in the 
application of these principles between listed chemicals subject to 29 
CFR 1910.119(a)(i) and flammables subject to 29 CFR 1910.119(a)(ii).

4. The Environmental Protection Agency (EPA) Risk Management Program 
(RMP)

    In addition to directing OSHA to develop the PSM standard, Congress 
directed EPA to address the hazards of catastrophic releases of highly 
hazardous chemicals to the atmosphere, (42 U.S.C. 7412(r)). EPA issued 
its rule on June 20, 1996, following promulgation of OSHA's PSM 
standard, (61 FR 31667). While the definition of ``process'' in the 
EPA-prescribed RMP is identical to the PSM definition, RMP does not use 
the term ``on site in one location''. Instead, RMP uses the term 
``stationary source,'' which is defined, in relevant part, as ``any 
buildings, structures, equipment, installations, or substance emitting 
stationary activities which belong to the same industrial group, which 
are located on one or more contiguous properties, which are under the 
control of the same person (or persons under common control), and from 
which an accidental release may occur.'' (40 CFR 68.3). This is the 
same definition used by Congress. (42 U.S.C.A 7412(r)(2)(c)).

C. The Regulatory Language and Structure

    As noted above, the Secretary construes the phrase ``on site in one 
location'' to refer to contiguous areas under the control of an 
employer, or group of affiliated employers, and, within that area to a 
group of vessels that are interconnected, or separate but sufficiently 
near each other that they could be involved in a catastrophic release. 
This interpretation accords with the ordinary dictionary meanings of 
``site'' and ``location'' and with the context of the entire 
application provision and the related regulatory definitions for 
``process'' and ``highly hazardous chemical.'' In interpreting the 
phrase, moreover, the Secretary has concluded that to give meaning to 
all the words of the standard, a certain degree of redundancy is 
inevitable; and that it would not be faithful to the drafters' intent 
or the purposes of the standard to construe ``on site in one location'' 
as completely separate from the definition of ``process,'' since the 
result would be to read part of the ``process'' definition out of the 
standard altogether. In so concluding, the Secretary notes that the 
overlap of ``process'' with ``on site in one location'' parallels a 
similar overlap with ``highly hazardous chemical,'' as the latter term 
appears both in the ``process'' definition and in the language of the 
application provision and its definition includes a reference back to 
the application provision. Thus, the standard applies to a process, a 
process is an activity involving a highly hazardous chemical, and a 
highly hazardous chemical is, inter alia, a chemical that is specified 
by the standard's application provision, 29 CFR 1910.119(a), (b). But, 
despite this evident circularity, nobody has ever objected to that 
overlap. Similarly, there is unavoidable overlap between ``on site in 
one location'' and the portions of the process definition that refer to 
interconnection and location.
    The interpretation provided here is consistent with the ordinary 
dictionary meaning of ``on site in one location.'' The dictionary 
defines ``site'' to mean, primarily, ``the position or location of a 
town, building, etc., esp. as to its environment.'' Webster's 
Unabridged Dictionary 1128, 1788 (2d ed. 2001). It defines ``location'' 
to mean, primarily, ``a place or situation occupied.'' See also 
American Heritage Dictionary (1976), 1210 (defining ``site'' as ``the 
place or plot of land where something was or is to be located'' ), 765 
(defining ``location'' to mean ``a place where something is or might be 
located; a site or situation''); Black's Law Dictionary (7th ed. 1999), 
at 1392 (``site'' means ``a place or location; esp., a piece of 
property set aside for a specific use''), at 951 (``location'' means 
``the specific place or position of a person or thing''). That ``site'' 
and ``location'' are virtually synonyms provides further support for 
the conclusion that avoiding redundancy was not uppermost in the minds 
of the drafters. Read together, however, they reinforce the idea that 
OSHA intended to give ``highly hazardous chemical'' and ``process'' a 
rough geographical, as well as functional, limit.
    This intent may be further discerned from consideration of relevant 
regulatory history. CAAA Section 304 directed the Secretary, in 
coordination with EPA, to promulgate a chemical process safety standard 
designed to protect employees from hazards associated with accidental 
releases of HHCs in the workplace. Although EPA's RMP Rule at 40 CFR 
part 68 et seq. does not contain an ``on site'' (or ``in one 
location'') limitation in its text, Congress's defining EPA coverage in 
terms of a ``stationary source'' accomplishes the same limitation. 
``Stationary source'' is defined as any buildings, structures, 
equipment, installations or substance emitting stationary activities 
(i) which belong to the same industrial group, (ii) which are located 
on one or more contiguous properties, (iii) which are under the control 
of the same person (or persons under common control), and (iv) from 
which an accidental release may occur, (42 U.S.C.A Sec.  
7412(r)(2)(c)).\4\ Because Congress mandated OSHA and EPA coordination 
in addressing the release of hazardous substances, the regulations of 
the two agencies are to be construed together. In other words, the 
boundaries of a covered facility under PSM will be similar to the 
boundaries of a stationary source under RMP, and ``on site in one 
location'' is given essentially the same meaning as the ``which are 
located on one or more contiguous properties'' component of the term 
``stationary source,'' while the rest of the definition mirrors OSHA's 
definition of ``process.'' Just as that term encompasses most of the 
PSM ``process'' definition, this construction of ``on site in one 
location'' also encompasses the inclusion of the ``on-site movement'' 
of HHCs that was added to the definition of ``process'' in the final 
rule. Although neither the NPRM nor the preamble to the final rule 
provides any detailed explanation of this inclusion, it would be 
consistent with the statutory aims of the CAAA to

[[Page 31456]]

limit PSM coverage to facilities included in the ``stationary source'' 
definition. To that end, the Secretary also reads the limitation in 
``stationary source'' to locations `` which are under the control of 
the same person (or persons under common control)'' as being implicit 
in the phrase ``on site in one location'' and, indeed, in the 
definition of ``process'' (since the former phrase only relates 
explicitly to flammable liquids and gases, and not to Appendix A toxic 
substances).
---------------------------------------------------------------------------

    \4\ This term was directly adopted into RMP at 40 CFR 68.3.
---------------------------------------------------------------------------

    This construction also comports with the regulatory history on 
aggregating the TQs of HHCs. As noted in the comments of stakeholders, 
``on site in one location'' could not be naturally read with the plural 
term ``processes'' in proposed Sec.  1910.119(b)(1)(ii). A large 
facility can have separate processes at different locations within its 
boundaries, a point raised by Allied Signal in its comments (Ex. 3-17). 
The American Paper Institute similarly commented that ``a significant 
concern for us is that the proposed rule is unclear as to how an 
employer can determine when the rule would apply to a particular 
facility handling chemicals at different locations of that facility.'' 
(Tr. 1112).
    Not only did the stakeholders point out that the NPRM's scope and 
application section was inconsistent with the proposed definition of 
``process,'' OSHA itself recognized the issue and took the unusual step 
of clarifying its intent in an interim proposal document. By stating 
that a chemical used in small quantities around the plant and not 
concentrated in one process or in one area would be unlikely to cause a 
catastrophic release, OSHA clearly sought to limit coverage of the PSM 
standard to situations where a TQ of an HHC was concentrated in a 
single, including an interconnected, process. Despite the inexact use 
of the plural ``processes'' in the NPRM, it was never the agency's 
intent to cover HHCs sufficiently dispersed in various locations on a 
large site, and in more than one process, such that their release from 
any one process would not cause the type of catastrophic harm that this 
standard was aimed to prevent. The use of ``on site in one location'' 
in the provision regarding flammables was intended to signal that 
employers would not need to aggregate all sources of the chemical 
facility-wide, or those outside the bounds of the employers' facility, 
although the provision did not clearly describe the agency's intent 
regarding which sources should be aggregated.
    The hearing transcripts and written comments confirm that members 
of the refinery industry, an industry with a particular interest in 
OSHA's regulation of flammable liquids and gases, understood and 
accepted OSHA's clarified position. For instance, Shell Oil Company 
testified that it ``strongly supports OSHA's position that owners 
should not aggregate quantities of chemicals at separate locations 
across a facility to determine if threshold quantities have been 
reached'', (Tr. 2591). BP testified that ``if flammables are over 
10,000 pounds in process, the rule applies to that process'', (Tr. 
3038). Amoco Corporation agreed that ``OSHA clarified that the 
threshold quantities of highly hazardous chemicals are determined on 
process basis, rather than by aggregating quantities of like chemicals 
for an entire facility'', (Ex. 3-165). Union Carbide similarly stated 
its understanding that ``all of the thresholds be calculated on a `per 
process' basis'', (Ex. 3-109).
    OSHA reiterated this position in the final rule, stating that it 
``continues to believe that the potential hazard of a catastrophic 
release exists when the highly hazardous chemical is concentrated in a 
single process'', (57 FR 6364). This was in agreement with those 
stakeholders who argued that TQs should not be aggregated over an 
entire facility, (e.g., Tr. 2591, 3192; Exs. 3-163, 3-164). OSHA's 
final position was that PSM coverage could only be found if a TQ of an 
HHC exists in a single process.
    To the extent ``on site in one location'' did not adequately convey 
that intent, the more precise revision of the definition of ``process'' 
as a result of the record comments did so by clarifying that the 
standard's scope was meant to apply to an area more confined than 
multiple processes, but more expansive than a single process point, 
where the process involves inter-connecting vessels or pipes, or 
vessels in close proximity such that the release of an HHC in one could 
trigger a chain reaction in the others. Accordingly, OSHA modified the 
definition of ``process'' to include the concepts of 
``interconnection'' and ``co-location'' with addition of the language, 
``any group of vessels which are interconnected or separate vessels 
which are located such that a highly hazardous chemical could be 
involved in a potential release shall be considered a single process.'' 
29 CFR 1910.119(b). OSHA stated in the final rule that this definition, 
when read in conjunction with the application section, establishes the 
standard's intended coverage, (57 FR 6372). Therefore, a ``single 
process'' containing a TQ of an HHC includes an ``interconnected'' or 
closely co-located process.

D. The Regulatory Purpose

    Construing ``on site in one location'' in tandem with the final, 
expanded definition of ``process'' also serves OSHA's intended 
purposes. First, the full definition of ``process'' makes clear that it 
was not OSHA's intent that it would be required to prove that a release 
of an HHC in one component of an interconnected process could affect a 
release in other components of the same interconnected process in order 
for the PSM standard to apply. Rather, the intent of OSHA and the 
understanding of the stakeholders were to the contrary, as the 
rulemaking record indicates. For example, AT&T recommended that OSHA 
define threshold quantity as ``the maximum amount in pounds in a 
process (or connected processes)'', (Ex. 3-126). Asarco, in its 
comments, suggested that an interconnected process should be covered by 
the PSM standard. (Ex. 3-125). API, the leading trade organization of 
the refinery industry, included the concept of interconnection in its 
Recommended Practice 750. As described supra, API 750 applied to 
``facilities'' that use, produce, process or store flammable or 
explosive substances that are present in such quantity and condition 
that a sudden, catastrophic release of more than five tons of gas or 
vapor can occur over a matter of minutes, based on credible failure 
scenarios and the properties of the materials involved, (API 750 
1.3.1.1(a)).\5\ The term ``facilities'', as used in API 750, includes 
buildings, containers, and equipment that are physically 
interconnected, (see API 750 1.4.4).
---------------------------------------------------------------------------

    \5\ In the final rule, OSHA rejected API's TQ of 5 tons of 
released flammable vapor as too complex, using instead the 10,000 
pounds TQ. 57 FR at 6366-67.
---------------------------------------------------------------------------

    The presence of the word ``or'' between interconnected and co-
located vessels in the final rule demonstrates that two potential 
avenues exist to find a covered process when several aspects may be 
involved in the overall process. The plain language of the definition 
establishes two distinct burdens of proof when considering the 
applicability of PSM to an interconnected or a co-located process. With 
respect to a co-located process, OSHA would be required to demonstrate 
as part of its prima facie case that unconnected but co-located 
processes are situated in a manner that a release from one process 
could contribute to the release of the other. In contrast, the 
definition of ``process'' contains no such requirement for an 
interconnected process. In other words, OSHA's intent is that the 
phrase ``which are located such that a highly

[[Page 31457]]

hazardous chemical could be involved in a potential release'' modifies 
only the immediately-preceding ``separate vessels,'' making the entire 
phrase parallel to the free-standing phrase ``any group of vessels 
which are interconnected.'' Thus, there is no additional requirement on 
OSHA to show the potentiality of a release with respect to 
interconnected (as opposed to separate) vessels. Rather, the PSM 
standard presumes that all aspects of a physically connected process 
can be expected to participate in a catastrophic release.
    Second, it is clear that, in revising the ``process'' definition to 
encompass the ``on-site movement'' of HHCs and the twin concepts of 
inter-connectedness and co-location, OSHA intended that definition to 
bear most of the weight of defining the scope of the standard. As 
originally drafted, the ``process'' definition not only did not have 
these clarifications, but ``onsite in one location'' appeared only in 
the subsection on flammable liquids and gases, and not in the 
subsection on Appendix A toxic substances. There is no obvious 
explanation why this was so. As noted, the phrase was intended to 
signal that it was not necessary to aggregate all sources of a chemical 
within, or beyond, the employer's facility. The final standard 
clarified and more precisely stated this intent and made clear that the 
same principles applied to both listed and flammable chemicals.
    The phrase in the final standard continues to carry its original 
NPRM meaning of setting a geographic boundary (``on site'') and, within 
that boundary, a site-specific parameter (``in one location''). But 
after the definition of ``process'' was changed in the final rule to 
include explicit language clarifying that a ``single process'' includes 
``any group of vessels which are interconnected or separate vessels 
which are located such that a highly hazardous chemical could be 
involved in a potential release,'' the limitation placed on application 
of the standard to flammable liquids and gases denoted by the related 
phrase ``on site in one location'' no longer carries the independent 
weight it had before OSHA clarified the intended meaning of 
``process.'' As previously stated, however, it continues to serve a 
separate purpose by operating to exclude coverage where the HHC 
threshold would be met only if all amounts in interconnected or co-
located vessels were aggregated but some of the amounts needed to meet 
the threshold quantity are outside of the perimeter of the employer's 
facility.

E. The Response to the Motiva Decision

    In the Motiva decision, the Review Commission appropriately left to 
the Secretary the task of interpreting ``on site in one location'' as 
it appears in the PSM standard, rather than doing so as an initial 
matter on its own. This Notice accomplishes that function. The 
interpretation set forth here is supported by the language, history and 
purposes of the standard and is consistent with the position adopted by 
EPA. In the absence of an agency interpretation, the Review Commission 
had focused on another guide to regulatory intent, the canon of 
construction that says that all the words of a statute (or regulation) 
should be assumed to have their own meaning, and suggested that ``on 
site in one location'' therefore has a meaning wholly apart from 
process. Regardless of the strength of this canon, the Secretary has 
satisfied it here by interpreting ``on site in one location'' to limit 
coverage to vessels within contiguous areas controlled by an employer 
or group of affiliated employers.
    More fundamentally, the Secretary agrees that canons of 
construction can be useful guides to regulatory intent. They are guides 
only, however, and should not be mechanically applied in the face of 
stronger indicia of intent. The flip side of the canon referred to 
above is the rule that the words of a standard (or regulation) should 
not be given meaning at the expense of rendering other words 
meaningless. Accordingly, the courts have put aside the general rule 
against redundancy in statutes if applying the rule would be counter to 
legislative intent. See Gutierrez v. Ada, 528 U.S. 250, 258 (2000) 
(``rule against redundancy does not necessarily have the strength to 
turn a tide of good cause to come out the other way''); Morton v. 
United Parcel Service, Inc., 272 F.3d 1249, 1258 (9th Cir. 2001) (rule 
of redundancy not followed when intent of statute clear); Mayer v. 
Spanel Intern. LTD., 51 F.3d 670, 674 (7th Cir. 1995) (every enacted 
word need not carry independent force absent strong evidence that at 
the time of enactment the words were understood as equivalents). In 
this case, the general statutory canon against redundancy cannot be 
given controlling weight given the clear intent of OSHA, in the final 
rule, and the stakeholders, through their comments, during the 
regulatory process. To do otherwise, in the Secretary's judgment, would 
render meaningless the most important revision affecting coverage that 
came out of the rulemaking process, namely the explicit inclusion of 
the twin concepts of interconnection and co-location in the definition 
of ``process'' and the clear intent that those concepts would determine 
coverage under the standard.
    Moreover, it is simply linguistically inescapable that there is 
overlap and redundancy among the terms of the standard. Motiva involved 
the interplay between ``on site in one location'' and the 
``interconnected'' prong of the definition of ``process,'' but the 
other prong of that definition refers to vessels that are so 
``located'' to create a risk of catastrophic release. Similarly, the 
appearance of ``highly hazardous chemical'' in the definition of 
``process'' and in the application provision, and the reference back to 
the application section in the HHC definition, creates an unavoidable 
redundancy. So too here, the Secretary cannot reasonably interpret ``on 
site in one location'' in a way that has no overlap with ``process.'' 
Instead, consistent with how courts generally apply the canons of 
construction, she has settled on an interpretation of the term ``on 
site in one location'' that conforms as much as possible to the 
ordinary meaning of the words and to the standard's overall language, 
history, and purposes.

Signature

    This document was prepared under the direction of Edwin G. Foulke, 
Jr., Assistant Secretary of Labor for Occupational Safety and Health, 
U.S. Department of Labor, 200 Constitution Avenue, NW., Washington, DC 
20210.

    Signed at Washington, DC, this 1st day of June, 2007.
Edwin G. Foulke, Jr.,
Assistant Secretary of Labor for Occupational Safety and Health.
 [FR Doc. E7-10918 Filed 6-6-07; 8:45 am]
BILLING CODE 4510-26-P

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