Pipeline Safety: Proposed Project-Specific Waiver of the Build America, Buy America Act Requirements for Certain Products Used by Philadelphia Gas Works, 79360-79362 [2024-22120]
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Federal Register / Vol. 89, No. 188 / Friday, September 27, 2024 / Notices
the merits of a petition for
inconsequentiality is determining
whether the noncompliance itself is
inconsequential to safety.’’ Tesla states
this statute requires NHTSA to ‘‘base its
decision on the petition squarely upon
the inconsequential nature of the
noncompliance. Any perceived benefit
of issuing Part 577 letters via first-class
mail to affected vehicle owners has no
bearing on whether the noncompliance
has an impact on motor vehicle safety
and is not relevant to assessing the
merits of this petition.’’
Tesla concludes by stating its belief
that the subject noncompliance is
inconsequential as it relates to motor
vehicle safety and its petition to be
exempted from providing notification of
the noncompliance, as required by 49
U.S.C. 30118, should be granted.
NHTSA notes that the statutory
provisions (49 U.S.C. 30118(d) and
30120(h)) that permit manufacturers to
file petitions for a determination of
inconsequentiality allow NHTSA to
exempt manufacturers only from the
duties found in sections 30118 and
30120, respectively, to notify owners,
purchasers, and dealers of a defect or
noncompliance and to remedy the
defect or noncompliance. Therefore, any
decision on this petition only applies to
the subject vehicles that Tesla no longer
controlled at the time it determined that
the noncompliance existed. However,
any decision on this petition does not
relieve vehicle distributors and dealers
of the prohibitions on the sale, offer for
sale, or introduction or delivery for
introduction into interstate commerce of
the noncompliant vehicles under their
control after Tesla notified them that the
subject noncompliance existed.
(Authority: 49 U.S.C. 30118, 30120;
delegations of authority at 49 CFR 1.95 and
501.8)
Otto G. Matheke III,
Director, Office of Vehicle Safety Compliance.
[FR Doc. 2024–22181 Filed 9–26–24; 8:45 am]
BILLING CODE 4910–59–P
DEPARTMENT OF TRANSPORTATION
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[Docket No. PHMSA–2024–0152]
Pipeline Safety: Proposed ProjectSpecific Waiver of the Build America,
Buy America Act Requirements for
Certain Products Used by Philadelphia
Gas Works
Pipeline and Hazardous
Materials Safety Administration
(PHMSA), U.S. Department of
Transportation (DOT).
ACTION: Notice; request for comments.
AGENCY:
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The Pipeline and Hazardous
Materials Safety Administration
(PHMSA) is proposing to waive the
Build America, Buy America (BABA)
Act’s domestic preference requirements
for certain products that Philadelphia
Gas Works (PGW) needs for its Natural
Gas Distribution Infrastructure Safety
and Modernization (NGDISM) grant
project. The proposed waiver would
exempt the following products used in
PGW’s project from BABA requirements
on the basis of nonavailability: electrofusion tapping tees, anodeless risers,
transition fittings, lockwing valves,
magnesium anodes, service adapters,
curb valves, caps, couplings, and
stiffeners. In accordance with section
70914(c) of BABA, PHMSA is seeking
public comments on the proposed
waiver.
SUMMARY:
Government Publishing Office’s website
at: www.GovInfo.gov.
DATES:
Confidential Business Information
Confidential Business Information
(CBI) is commercial or financial
information that is both customarily and
actually treated as private by its owner.
Under the Freedom of Information Act
(FOIA) (5 U.S.C. 552), CBI is exempt
from public disclosure. If your
comments responsive to this notice
contain commercial or financial
information that is customarily treated
as private, that you actually treat as
private, and that is relevant or
responsive to this notice, it is important
that you clearly designate the submitted
comments as CBI. You may ask PHMSA
to give confidential treatment to
information you give to the agency by
taking the following steps: (1) mark each
page of the original document
submission containing CBI as
‘‘Confidential’’; (2) send PHMSA, along
with the original document, a second
copy of the original document with the
CBI deleted; and (3) explain why the
information you are submitting is CBI.
Unless you are notified otherwise,
PHMSA will treat such marked
submissions as confidential under the
FOIA, and they will not be placed in the
public docket of this Notice.
Submissions containing CBI should be
sent to: Mr. Brandon Hollingshead,
PHMSA, 1200 New Jersey Avenue SE,
E26–316, Washington, DC 20590. Any
comment submissions that PHMSA
receives that are not specifically
designated as CBI will be placed in the
public docket for this matter.
Electronic Access and Filing
Background
The NGDISM program was authorized
by the Infrastructure Investment and
Jobs Act (IIJA) (Pub. L. 117–58). The
program provides Federal funding to
municipal- or community-owned
natural gas utilities (not including forprofit entities) to repair, rehabilitate, or
replace their natural gas distribution
pipeline systems or portions thereof, or
to acquire equipment to (1) reduce
incidents and fatalities and (2) avoid
economic losses. The IIJA appropriates
$200 million per year for each of Fiscal
Years (FY) 2022 through 2026 for the
NGDISM program ($1 billion in total).
The IIJA provides that 2 percent of this
amount shall be used to pay the
administrative expenses of the NGDISM
program. Accordingly, the total amount
expected to be awarded as grant funding
over the five-year period is
$980,000,000. In FY2022, PHMSA
awarded approximately $196 million to
37 municipal- and community-owned
natural gas utilities across the nation to
Comments must be received by
October 15, 2024.
ADDRESSES: Please submit your
comments to the Federal eRulemaking
Portal at https://www.regulations.gov,
Docket No. PHMSA–2024–0152, and
follow the online instructions for
submitting comments.
Instructions: You must include the
agency name and docket number at the
beginning of your comments. Except as
described below under the heading
‘‘Confidential Business Information,’’ all
submissions received, including any
personal information provided, will be
posted without change or alteration to
https://www.regulations.gov. For more
information, you may review the U.S.
Department of Transportation’s
complete Privacy Act Statement
published in the Federal Register on
April 11, 2000 (65 FR 19477).
FOR FURTHER INFORMATION CONTACT: For
questions about this notice, please
contact Mr. Brandon Hollingshead,
PHMSA Office of the Chief Counsel,
202–366–4400, or via email at
brandon.hollingshead@dot.gov. Office
hours for PHMSA are from 8:30 a.m. to
5:00 p.m., E.T., Monday through Friday,
except Federal holidays.
SUPPLEMENTARY INFORMATION:
A copy of this Notice, all comments
received on this Notice, and all
background material may be viewed
online at https://www.regulations.gov
using the docket number listed above.
Electronic retrieval help and guidelines
are also available at https://
www.regulations.gov. An electronic
copy of this document also may be
downloaded from the Office of the
Federal Register’s website at:
www.FederalRegister.gov and the
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fund pipeline replacement projects and
the purchase of leak-detection
equipment.
Congress also enacted the Build
America, Buy America Act (BABA),
providing that ‘‘none of the funds made
available for a Federal financial
assistance program for infrastructure
. . . may be obligated for a project
unless all of the iron, steel,
manufactured products, and
construction materials used in the
project are produced in the United
States.’’ IIJA, Public Law 117–58,
section 70914(a). Under IIJA section
70914(b), PHMSA has authority to
waive the requirements of BABA (1) if
a domestic product is unavailable, (2) if
using a domestic product would present
an unreasonable cost, or (3) if
application of BABA would not be in
the public interest.
In FY2022, PGW was awarded $10
million in NGDISM grant funding to
help fund the replacement of ‘‘at-risk’’
cast iron natural gas main in historically
disadvantaged census tracts within the
City of Philadelphia as part of its
‘‘Citywide Neighborhood Safety and
Modernization’’ project. The project,
which will be located entirely within
Philadelphia’s historically
disadvantaged census tracts, will
replace approximately 6 miles of aging
cast iron, ductile iron, and unprotected
steel pipelines with modern
polyethylene plastic pipe that is less
susceptible to breakage due to earth
movement—the biggest threat to PGW’s
existing cast iron pipelines, especially
during the winter months.
Justification for Waiver
PGW seeks a waiver of BABA
requirements for certain products on the
basis of nonavailability. The specific
essential products PGW seeks a waiver
for are listed below:
• Electro-fusion tapping tees: Electrofusion tapping tees are rigid sections of
polyethylene pipe that are fused to the
top of an existing polyethylene pipeline.
They are used to provide a branch outlet
from a gas main to a service line.
(NAICS: 326122)
• Anodeless risers: Anodeless risers
are sections of pipe that provide a 90degree connection between
underground gas service lines and
aboveground meter assemblies. Risers
are typically made of steel but may also
include polyethylene components and
may include a protective sleeve over the
polyethylene components. Anodeless
risers are manufactured in a variety of
sizes and may be rigid or flexible.
(NAICS: 33296)
• Transition fittings: Transition
fittings are adapters that facilitate
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below-grade transition from
polyethylene pipe to steel pipe before it
exits the ground. The steel section of the
fitting is epoxy-coated for corrosion
resistance. Transition fittings
incorporate both steel and polyethylene
components. (NAICS: 332919)
• Lockwing valves: Lockwing valves
are installed at the ‘‘head’’ of a service
line, upstream of a meter assembly, and
are used to stop or start the flow of gas.
They are lockable to resist tampering or
accidental opening of the valve. They
are typically made of brass. (NAICS:
332919)
• Magnesium anodes: Magnesium
anodes are blocks of magnesium that are
attached to steel pipe in order to protect
against corrosion damage. (NAICS:
335999)
• Service adapters: Service adapters
are threaded fittings used on a meter set
assembly above ground. They are
typically made of steel and are used to
connect two pieces of steel pipe in a
meter assembly. (NAICS: 332919)
• Curb valves: Curb valves are shutoff valves installed in a readilyaccessible outside location (such as in
the footway). They are used to control
the gas upstream of a gas meter, but
downstream of the main service tee in
the street. Curb valves can be made of
either polyethylene or steel. PGW
requires the use of polyethylene curb
valves in its system. Accordingly,
PHMSA proposes to waive BABA
requirements for polyethylene curb
valves. (NAICS: 326122)
• Caps: Caps are added to a pipeline
in order to close off sections of the
pipeline or to cap off dead-end lines.
Caps can be made of either polyethylene
or steel, depending on the material of
the pipe capped off. PGW is not able to
find a BABA-compliant source for steel
caps. Accordingly, PHMSA proposes to
waive BABA requirements for steel
caps. (NAICS: 332919)
• Couplings: Couplings can be used
to connect two sections of pipe made
from either polyethylene, steel, ductile
iron, or cast iron. PGW requires the use
of steel couplings on its distribution
system. Accordingly, PHMSA proposes
to waive BABA requirements for
couplings made of steel. (NAICS:
332919)
• Stiffeners: Stiffeners are inserted
into plastic pipe alongside couplings to
support the pipe, mitigate stress, and
provide a long-lasting seal. (NAICS:
326122)
To conduct market research, PGW
initially engaged with its normal
suppliers of gas distribution pipeline
parts. Eight of PGW’s normal suppliers
indicated that they could provide
BABA-compliant products but were not
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79361
willing to certify to BABA compliance.
One of PGW’s alternate suppliers
indicated it could provide BABAcompliant caps, couplings, and
stiffeners, albeit at an increased cost and
a long lead time which would cause an
estimated 36-week delay in PGW’s
construction schedule, which is
untenable for PGW’s project. PGW also
reached out to neighboring gas utilities
to inquire about their sources but was
likewise unable to locate a domestic
source for these products that way.
On April 10, 2024, in an effort to
locate additional alternative suppliers,
PGW issued a Request for Quotation
(RFQ) titled ‘‘One Time Purchase of
BABA Compliant Alternatives.’’ The
RFQ was publicly posted to PGW’s
Procureware website, and was open
from April 10, 2024 until April 29,
2024. PGW invited 80 suppliers and
manufacturers to submit bids. As a
result of the RFQ, PGW identified
BABA-compliant alternatives for 8 types
of products for which PGW was not
previously able to find domestic
sources. However, PGW still was not
able to find suitable or readily available
alternatives for the 10 products
proposed to be waived herein.
On these bases, PHMSA has
preliminarily determined that these
products are not manufactured in the
United States in sufficient and
reasonably available quantities or of a
satisfactory quality.
Proposed Waiver and Request for
Comments
PHMSA proposes to waive the
requirements of BABA for the above
listed products for PGW’s ‘‘Citywide
Neighborhood Safety and
Modernization’’ project funded by
NGDISM grant funds. The waiver would
be applicable only to PGW’s project; it
would not be applicable to any other
NGDISM grant recipient’s projects. The
proposed waiver would be effective
from the effective date of the final
waiver through the period of
performance and closeout of PHMSA’s
financial assistance for the project,
which is estimated to be June 30, 2029.
If the sources of Federal financial
assistance applied to the project are
changed, PHMSA will consider whether
the waiver continues to be warranted,
taking into account the project’s
development status at that time and any
changes in market conditions for the
products subject to the waiver.
PGW was awarded $10 million in
NGDISM grant funding in FY2022.
However, labor costs, rather than
materials costs, typically make up the
majority of costs in pipeline
replacement projects. PGW estimates
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Federal Register / Vol. 89, No. 188 / Friday, September 27, 2024 / Notices
that only $856,941 of the total project
budget will be spent on materials. Out
of this amount, PGW anticipates that
only about $140,201 would be spent on
the products proposed to be waived
herein—or 16 percent of PGW’s
materials costs. This $140,201 is further
split across ten different products.
By contrast, the proposed waiver
would have a significant impact on
PGW’s ability to successfully complete
its NGDISM projects. Absent the
proposed waiver, PGW will not be able
to comply with BABA requirements for
the above listed products, either because
PGW’s market research was not able to
identify any domestic sources, or it is
not feasible for PGW to utilize the
domestic source it did identify due to
the extreme construction delays that
would result.
While PGW did find a domestic
source for caps, couplings, and
stiffeners, the manufacturer indicated
that it would need a lead time of 14- to
16-weeks from the date of order before
it could supply BABA-compliant
versions of these products to PGW. To
ensure the safety of the public, PGW
would first need to order a sample of the
new products to conduct quality control
testing, which PGW indicated could
take up to 4 weeks. If the new products
pass quality control testing, PGW would
then need to place a full order for the
new products, resulting in another 14to 16-week lead time to receive them.
The entire process, from initial ordering
of sample products to receipt and
acceptance of the full order, could result
in a construction delay of up to 36
weeks. Distribution gas construction
cannot proceed without these primary
components and the alternative
extended lead time prolongs the time of
exposure to potential leaks and threats
to life and property. A delayed
construction schedule could result in
safety impacts for PGW’s customers,
especially those located in five USDOTdesignated historically disadvantaged
neighborhoods within the project area.
PGW estimates that such a delay would
push its projected FY2025 project
completion to the summer of FY2026,
subjecting these customers to an
additional winter season with sag
service by cast iron pipes—a time when
gas leaks are more likely to occur due
to frost heave and other winter ground
movement. Combined with the age of
PGW’s cast iron pipelines in these
neighborhoods, this would create an
appreciably increased risk to residents
in these neighborhoods.
Under OMB Memorandum M–24–02,
agencies are expected to assess
‘‘whether a significant portion of any
cost advantage of a foreign-sourced
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17:09 Sep 26, 2024
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product is the result of the use of
dumped steel, iron, or manufactured
products or the use of injuriously
subsidized steel, iron, or manufactured
products’’ as appropriate before granting
a public interest waiver. PHMSA’s
analysis has concluded that this
assessment is not applicable to this
waiver, as it is being proposed on the
basis of nonavailability, rather than
public interest or unreasonable cost.
PHMSA will consider all comments
received in the initial 15-day comment
period during our consideration of the
proposed waiver, as required by section
70914(c)(2) of the IIJA. Comments
received after this period, but before
notice of our finding is published in the
Federal Register, will be considered to
the extent practicable.
Issued in Washington, DC, on September
23, 2024, under authority delegated in 49
CFR 1.97.
Tristan H. Brown,
Deputy Administrator.
[FR Doc. 2024–22120 Filed 9–26–24; 8:45 am]
BILLING CODE 4910–60–P
DEPARTMENT OF TRANSPORTATION
Pipeline and Hazardous Materials
Safety Administration
[Docket No. PHMSA–2024–0151]
Pipeline Safety: Proposed ProjectSpecific Waiver of the Build America,
Buy America Act Requirements for
City Utilities of Springfield, Missouri
for Certain Products
Pipeline and Hazardous
Materials Safety Administration
(PHMSA), Department of Transportation
(DOT).
ACTION: Notice; request for comments.
AGENCY:
The Pipeline and Hazardous
Materials Safety Administration
(PHMSA) proposes to waive the Build
America, Buy America (BABA) Act’s
domestic preference requirements for
certain products that City Utilities of
Springfield (City Utilities) will use in its
Natural Gas Distribution Infrastructure
Safety and Modernization (NGDISM)
grant project. The proposed waiver
would exempt the following products
used in City Utilities’ project from
BABA requirements on the basis of
nonavailability: locator markers; meter
stops with insulated unions; magnesium
anodes; 1A meter swivels, nuts, and
washers; and direct bury lugs. In
accordance with section 70914(c) of
BABA, PHMSA is seeking public
comments on the proposed waiver.
DATES: Comments must be received by
October 15, 2024.
SUMMARY:
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Fmt 4703
Sfmt 4703
Please submit your
comments to the Federal eRulemaking
Portal at https://www.regulations.gov,
Docket No. PHMSA–2024–0151, and
follow the online instructions for
submitting comments.
Instructions: You must include the
agency name and docket number at the
beginning of your comments. Except as
described below under the heading
‘‘Confidential Business Information,’’ all
submissions received, including any
personal information provided, will be
posted without change or alteration to
https://www.regulations.gov. For more
information, you may review the U.S.
Department of Transportation’s
complete Privacy Act Statement
published in the Federal Register on
April 11, 2000, (65 FR 19477).
FOR FURTHER INFORMATION CONTACT: For
questions about this notice, please
contact Mr. Brandon Hollingshead,
PHMSA Office of the Chief Counsel,
202–366–4400, or via email at
brandon.hollingshead@dot.gov. Office
hours for PHMSA are from 8:30 a.m. to
5 p.m., E.T., Monday through Friday,
except Federal holidays.
SUPPLEMENTARY INFORMATION:
ADDRESSES:
Electronic Access and Filing
A copy of this Notice, all comments
received on this Notice, and all
background material may be viewed
online at https://www.regulations.gov
using the docket number listed above.
Electronic retrieval help and guidelines
are also available at https://
www.regulations.gov. An electronic
copy of this document also may be
downloaded from the Office of the
Federal Register’s website at:
www.FederalRegister.gov and the
Government Publishing Office’s website
at: www.GovInfo.gov.
Confidential Business Information
Confidential Business Information
(CBI) is commercial or financial
information that is both customarily and
actually treated as private by its owner.
Under the Freedom of Information Act
(FOIA) (5 U.S.C. 552), CBI is exempt
from public disclosure. If your
comments responsive to this notice
contain commercial or financial
information that is customarily treated
as private, that you actually treat as
private, and that is relevant or
responsive to this notice, it is important
that you clearly designate the submitted
comments as CBI. You may ask PHMSA
to give confidential treatment to
information you give to the agency by
taking the following steps: (1) mark each
page of the original document
submission containing CBI as
E:\FR\FM\27SEN1.SGM
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]]>Agencies
[Federal Register Volume 89, Number 188 (Friday, September 27, 2024)]
[Notices]
[Pages 79360-79362]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-22120]
-----------------------------------------------------------------------
DEPARTMENT OF TRANSPORTATION
[Docket No. PHMSA-2024-0152]
Pipeline Safety: Proposed Project-Specific Waiver of the Build
America, Buy America Act Requirements for Certain Products Used by
Philadelphia Gas Works
AGENCY: Pipeline and Hazardous Materials Safety Administration (PHMSA),
U.S. Department of Transportation (DOT).
ACTION: Notice; request for comments.
-----------------------------------------------------------------------
SUMMARY: The Pipeline and Hazardous Materials Safety Administration
(PHMSA) is proposing to waive the Build America, Buy America (BABA)
Act's domestic preference requirements for certain products that
Philadelphia Gas Works (PGW) needs for its Natural Gas Distribution
Infrastructure Safety and Modernization (NGDISM) grant project. The
proposed waiver would exempt the following products used in PGW's
project from BABA requirements on the basis of nonavailability:
electro-fusion tapping tees, anodeless risers, transition fittings,
lockwing valves, magnesium anodes, service adapters, curb valves, caps,
couplings, and stiffeners. In accordance with section 70914(c) of BABA,
PHMSA is seeking public comments on the proposed waiver.
DATES: Comments must be received by October 15, 2024.
ADDRESSES: Please submit your comments to the Federal eRulemaking
Portal at https://www.regulations.gov, Docket No. PHMSA-2024-0152, and
follow the online instructions for submitting comments.
Instructions: You must include the agency name and docket number at
the beginning of your comments. Except as described below under the
heading ``Confidential Business Information,'' all submissions
received, including any personal information provided, will be posted
without change or alteration to https://www.regulations.gov. For more
information, you may review the U.S. Department of Transportation's
complete Privacy Act Statement published in the Federal Register on
April 11, 2000 (65 FR 19477).
FOR FURTHER INFORMATION CONTACT: For questions about this notice,
please contact Mr. Brandon Hollingshead, PHMSA Office of the Chief
Counsel, 202-366-4400, or via email at [email protected].
Office hours for PHMSA are from 8:30 a.m. to 5:00 p.m., E.T., Monday
through Friday, except Federal holidays.
SUPPLEMENTARY INFORMATION:
Electronic Access and Filing
A copy of this Notice, all comments received on this Notice, and
all background material may be viewed online at https://www.regulations.gov using the docket number listed above. Electronic
retrieval help and guidelines are also available at https://www.regulations.gov. An electronic copy of this document also may be
downloaded from the Office of the Federal Register's website at:
www.FederalRegister.gov and the Government Publishing Office's website
at: www.GovInfo.gov.
Confidential Business Information
Confidential Business Information (CBI) is commercial or financial
information that is both customarily and actually treated as private by
its owner. Under the Freedom of Information Act (FOIA) (5 U.S.C. 552),
CBI is exempt from public disclosure. If your comments responsive to
this notice contain commercial or financial information that is
customarily treated as private, that you actually treat as private, and
that is relevant or responsive to this notice, it is important that you
clearly designate the submitted comments as CBI. You may ask PHMSA to
give confidential treatment to information you give to the agency by
taking the following steps: (1) mark each page of the original document
submission containing CBI as ``Confidential''; (2) send PHMSA, along
with the original document, a second copy of the original document with
the CBI deleted; and (3) explain why the information you are submitting
is CBI. Unless you are notified otherwise, PHMSA will treat such marked
submissions as confidential under the FOIA, and they will not be placed
in the public docket of this Notice. Submissions containing CBI should
be sent to: Mr. Brandon Hollingshead, PHMSA, 1200 New Jersey Avenue SE,
E26-316, Washington, DC 20590. Any comment submissions that PHMSA
receives that are not specifically designated as CBI will be placed in
the public docket for this matter.
Background
The NGDISM program was authorized by the Infrastructure Investment
and Jobs Act (IIJA) (Pub. L. 117-58). The program provides Federal
funding to municipal- or community-owned natural gas utilities (not
including for-profit entities) to repair, rehabilitate, or replace
their natural gas distribution pipeline systems or portions thereof, or
to acquire equipment to (1) reduce incidents and fatalities and (2)
avoid economic losses. The IIJA appropriates $200 million per year for
each of Fiscal Years (FY) 2022 through 2026 for the NGDISM program ($1
billion in total). The IIJA provides that 2 percent of this amount
shall be used to pay the administrative expenses of the NGDISM program.
Accordingly, the total amount expected to be awarded as grant funding
over the five-year period is $980,000,000. In FY2022, PHMSA awarded
approximately $196 million to 37 municipal- and community-owned natural
gas utilities across the nation to
[[Page 79361]]
fund pipeline replacement projects and the purchase of leak-detection
equipment.
Congress also enacted the Build America, Buy America Act (BABA),
providing that ``none of the funds made available for a Federal
financial assistance program for infrastructure . . . may be obligated
for a project unless all of the iron, steel, manufactured products, and
construction materials used in the project are produced in the United
States.'' IIJA, Public Law 117-58, section 70914(a). Under IIJA section
70914(b), PHMSA has authority to waive the requirements of BABA (1) if
a domestic product is unavailable, (2) if using a domestic product
would present an unreasonable cost, or (3) if application of BABA would
not be in the public interest.
In FY2022, PGW was awarded $10 million in NGDISM grant funding to
help fund the replacement of ``at-risk'' cast iron natural gas main in
historically disadvantaged census tracts within the City of
Philadelphia as part of its ``Citywide Neighborhood Safety and
Modernization'' project. The project, which will be located entirely
within Philadelphia's historically disadvantaged census tracts, will
replace approximately 6 miles of aging cast iron, ductile iron, and
unprotected steel pipelines with modern polyethylene plastic pipe that
is less susceptible to breakage due to earth movement--the biggest
threat to PGW's existing cast iron pipelines, especially during the
winter months.
Justification for Waiver
PGW seeks a waiver of BABA requirements for certain products on the
basis of nonavailability. The specific essential products PGW seeks a
waiver for are listed below:
Electro-fusion tapping tees: Electro-fusion tapping tees
are rigid sections of polyethylene pipe that are fused to the top of an
existing polyethylene pipeline. They are used to provide a branch
outlet from a gas main to a service line. (NAICS: 326122)
Anodeless risers: Anodeless risers are sections of pipe
that provide a 90-degree connection between underground gas service
lines and aboveground meter assemblies. Risers are typically made of
steel but may also include polyethylene components and may include a
protective sleeve over the polyethylene components. Anodeless risers
are manufactured in a variety of sizes and may be rigid or flexible.
(NAICS: 33296)
Transition fittings: Transition fittings are adapters that
facilitate below-grade transition from polyethylene pipe to steel pipe
before it exits the ground. The steel section of the fitting is epoxy-
coated for corrosion resistance. Transition fittings incorporate both
steel and polyethylene components. (NAICS: 332919)
Lockwing valves: Lockwing valves are installed at the
``head'' of a service line, upstream of a meter assembly, and are used
to stop or start the flow of gas. They are lockable to resist tampering
or accidental opening of the valve. They are typically made of brass.
(NAICS: 332919)
Magnesium anodes: Magnesium anodes are blocks of magnesium
that are attached to steel pipe in order to protect against corrosion
damage. (NAICS: 335999)
Service adapters: Service adapters are threaded fittings
used on a meter set assembly above ground. They are typically made of
steel and are used to connect two pieces of steel pipe in a meter
assembly. (NAICS: 332919)
Curb valves: Curb valves are shut-off valves installed in
a readily-accessible outside location (such as in the footway). They
are used to control the gas upstream of a gas meter, but downstream of
the main service tee in the street. Curb valves can be made of either
polyethylene or steel. PGW requires the use of polyethylene curb valves
in its system. Accordingly, PHMSA proposes to waive BABA requirements
for polyethylene curb valves. (NAICS: 326122)
Caps: Caps are added to a pipeline in order to close off
sections of the pipeline or to cap off dead-end lines. Caps can be made
of either polyethylene or steel, depending on the material of the pipe
capped off. PGW is not able to find a BABA-compliant source for steel
caps. Accordingly, PHMSA proposes to waive BABA requirements for steel
caps. (NAICS: 332919)
Couplings: Couplings can be used to connect two sections
of pipe made from either polyethylene, steel, ductile iron, or cast
iron. PGW requires the use of steel couplings on its distribution
system. Accordingly, PHMSA proposes to waive BABA requirements for
couplings made of steel. (NAICS: 332919)
Stiffeners: Stiffeners are inserted into plastic pipe
alongside couplings to support the pipe, mitigate stress, and provide a
long-lasting seal. (NAICS: 326122)
To conduct market research, PGW initially engaged with its normal
suppliers of gas distribution pipeline parts. Eight of PGW's normal
suppliers indicated that they could provide BABA-compliant products but
were not willing to certify to BABA compliance. One of PGW's alternate
suppliers indicated it could provide BABA-compliant caps, couplings,
and stiffeners, albeit at an increased cost and a long lead time which
would cause an estimated 36-week delay in PGW's construction schedule,
which is untenable for PGW's project. PGW also reached out to
neighboring gas utilities to inquire about their sources but was
likewise unable to locate a domestic source for these products that
way.
On April 10, 2024, in an effort to locate additional alternative
suppliers, PGW issued a Request for Quotation (RFQ) titled ``One Time
Purchase of BABA Compliant Alternatives.'' The RFQ was publicly posted
to PGW's Procureware website, and was open from April 10, 2024 until
April 29, 2024. PGW invited 80 suppliers and manufacturers to submit
bids. As a result of the RFQ, PGW identified BABA-compliant
alternatives for 8 types of products for which PGW was not previously
able to find domestic sources. However, PGW still was not able to find
suitable or readily available alternatives for the 10 products proposed
to be waived herein.
On these bases, PHMSA has preliminarily determined that these
products are not manufactured in the United States in sufficient and
reasonably available quantities or of a satisfactory quality.
Proposed Waiver and Request for Comments
PHMSA proposes to waive the requirements of BABA for the above
listed products for PGW's ``Citywide Neighborhood Safety and
Modernization'' project funded by NGDISM grant funds. The waiver would
be applicable only to PGW's project; it would not be applicable to any
other NGDISM grant recipient's projects. The proposed waiver would be
effective from the effective date of the final waiver through the
period of performance and closeout of PHMSA's financial assistance for
the project, which is estimated to be June 30, 2029. If the sources of
Federal financial assistance applied to the project are changed, PHMSA
will consider whether the waiver continues to be warranted, taking into
account the project's development status at that time and any changes
in market conditions for the products subject to the waiver.
PGW was awarded $10 million in NGDISM grant funding in FY2022.
However, labor costs, rather than materials costs, typically make up
the majority of costs in pipeline replacement projects. PGW estimates
[[Page 79362]]
that only $856,941 of the total project budget will be spent on
materials. Out of this amount, PGW anticipates that only about $140,201
would be spent on the products proposed to be waived herein--or 16
percent of PGW's materials costs. This $140,201 is further split across
ten different products.
By contrast, the proposed waiver would have a significant impact on
PGW's ability to successfully complete its NGDISM projects. Absent the
proposed waiver, PGW will not be able to comply with BABA requirements
for the above listed products, either because PGW's market research was
not able to identify any domestic sources, or it is not feasible for
PGW to utilize the domestic source it did identify due to the extreme
construction delays that would result.
While PGW did find a domestic source for caps, couplings, and
stiffeners, the manufacturer indicated that it would need a lead time
of 14- to 16-weeks from the date of order before it could supply BABA-
compliant versions of these products to PGW. To ensure the safety of
the public, PGW would first need to order a sample of the new products
to conduct quality control testing, which PGW indicated could take up
to 4 weeks. If the new products pass quality control testing, PGW would
then need to place a full order for the new products, resulting in
another 14- to 16-week lead time to receive them. The entire process,
from initial ordering of sample products to receipt and acceptance of
the full order, could result in a construction delay of up to 36 weeks.
Distribution gas construction cannot proceed without these primary
components and the alternative extended lead time prolongs the time of
exposure to potential leaks and threats to life and property. A delayed
construction schedule could result in safety impacts for PGW's
customers, especially those located in five USDOT-designated
historically disadvantaged neighborhoods within the project area. PGW
estimates that such a delay would push its projected FY2025 project
completion to the summer of FY2026, subjecting these customers to an
additional winter season with sag service by cast iron pipes--a time
when gas leaks are more likely to occur due to frost heave and other
winter ground movement. Combined with the age of PGW's cast iron
pipelines in these neighborhoods, this would create an appreciably
increased risk to residents in these neighborhoods.
Under OMB Memorandum M-24-02, agencies are expected to assess
``whether a significant portion of any cost advantage of a foreign-
sourced product is the result of the use of dumped steel, iron, or
manufactured products or the use of injuriously subsidized steel, iron,
or manufactured products'' as appropriate before granting a public
interest waiver. PHMSA's analysis has concluded that this assessment is
not applicable to this waiver, as it is being proposed on the basis of
nonavailability, rather than public interest or unreasonable cost.
PHMSA will consider all comments received in the initial 15-day
comment period during our consideration of the proposed waiver, as
required by section 70914(c)(2) of the IIJA. Comments received after
this period, but before notice of our finding is published in the
Federal Register, will be considered to the extent practicable.
Issued in Washington, DC, on September 23, 2024, under authority
delegated in 49 CFR 1.97.
Tristan H. Brown,
Deputy Administrator.
[FR Doc. 2024-22120 Filed 9-26-24; 8:45 am]
BILLING CODE 4910-60-P
