EPA v. SOUTHERN PACIFIC PIPELINE

Case summary

SOUTHERN PACIFIC PIPE LINES OPERATES A GASOLINE BULK TERM- INAL IN FRESNO, CA. FRESNO COUNTY IS A NONATTAINMENT AREA FOR OZONE WHICH RECEIVED AN EXTENSION UNTIL 1987 TO DEMON- STRATE ATTAINMENT. SPPL IS A DELAWARE CORPORATION REGISTER- ED TO DO BUSINESS IN CALIFORNIA AND HAS ITS CORPORATE HQ IN LOS ANGELES. SPPL PIPES GASOLINE FROM VARIOUS LOCATIONS IN CALIFORNIA TO FRESNO, PLACES IT IN STORAGE TANKS AT THE FRESNO FACILITY AND LOADS IT INTO GASOLINE TRUCKS VIA LOADING RACKS FOR TRANSPORT TO GAS STATIONS. SPPL'S FRESNO FACILITY IS ONE OF THE LARGEST GASOLINE BULK TERMINALS IN THE AREA & IS LISTED IN CDS AS A SIGNIFICANT VIOLATOR. SPPL VIOLATED THE CALIFORNIA STATE IMPLEMENTATION PLAN AT ITS FRESNO FACILITY IN THAT ITS VAPOR RECOVERY SYSTEM WHICH CONTROLS VOLATILE ORGANIC COMPOUNDS EMISSIONS WAS OPERATING BELOW THE EFFICIENCY REQUIRED BY FRESNO COUNTY AIR POLLUTION CONTROL DISTRICT RULE 412. SPECIFICALLY, A SOURCE TEST IN AUGUST OF 1984 PERFORMED BY THE CALIFORNIA AIR RESOURCE BOARD SHOWED THAT SPPL'S VAPOR RECOVERY UNIT WAS OPERATING AT 84.7% EFFICIENCY, WHILE DISTRICT RULE 412 REQUIRES 80% EFFICIENCY. EPA ISSUED A NOTICE OF VIOLATION ON MARCH 29, 1985. SUB- SEQUENTLY, ON MAY 30, AN SPPL CONTRACTOR PERFORMED ANOTHER SOURCE TEST ON THE VAPOR RECOVERY UNIT WHICH SHOWED IT STILL TO BE IN VIOLATION, OPERATING AT 82.5% EFFICIENCY. IN ADDITION TO THE SIP VIOLATION, SPPL APPARENTLY VIOLATED THE NEW SOURCE PERFORMANCE STANDARDS FOR GASOLINE LOADING RACKS. THE FRESNO FACILITY BECAME SUBJECT TO NSPS BY CON- STRUCTING A FOURTH LOADING RACK ON JUNE 25, 1984 AND BEGIN- NING TO OPERATE IT ON MARCH 25, 1985. IF SPPL'S FRESNO FACILITY IS SUBJECT TO NSPS REGULATIONS, SPPL VIOLATED BOTH THE NOTIFICATION AND PERFORMANCE STANDARD PROVISIONS. IT FAILED TO NOTIFY EPA OF THE ADDITION OF THE FOURTH LOADING RACK AND IT FAILED TO NOTIFY EPA OF THE PER- FORMANCE OF A SOURCE TEST, AS REQUIRED BY 40 CFR 60.7 AND 60.8. ALSO, THE MAY 30, 1985 SOURCE TEST PERFORMED BY SPPL'S CONTRACTOR SHOWED THAT THE VAPOR RECOVERY UNIT EMITTED MORE HYDROCARBON AIR POLLUTION THAN IS ALLOWED BY THE APPLICABLE NSPS PERFORMANCE STANDARD. THE SOURCE TEST SHOWED THE UNIT TO BE EMITTING 82.8 MG OF VOC PER LITER OF GASOLINE LOADED, WHILE THE APPLICABLE NSPS STANDARD IS 80 MG OF VOC PER LITER OF GASOLINE LOADED. AFTER EPA NOTIFIED SPPL THAT ITS VAPOR RECOVERY UNIT WAS OPERATING IN VIOLATION OF RULE 412, SPPL CONTRACTED TO REPLACE IT AT A COST OF $635,000. SPPL'S PERSONNEL HAVE MET TWICE WITH REPRESENTATIVES OF EPA REGION IX AND HAVE SUBMITTED A COMPLIANCE SCHEDULE WHICH CALLS FOR FINAL COM- PLIANCE WITH BOTH THE SIP AND NSPS LIMITS BY APRIL, 1986. SPPL IS WILLING TO HAVE THE COMPLIANCE SCHEDULE SUBMITTED AS A CONSENT DECREE. CIVIL PENALTIES ARE APPROPRIATE IN THIS CASE. THE ECONOM- IC BENEFIT IS $32,301 AND THE UNADJUSTED GRAVITY COMPONENT IS $58,000. AS DISCUSSED BELOW, THE GRAVITY COMPONENT SHOULD BE MITIGATED SO THAT THE CIVIL PENALTY IS $55,501. ALSO, CONSIDERING THE LITIGATION RISK OF NOT BEING ABLE TO PROVE THAT THE NSPS APPLIES TO SPPL, WE RECOMMEND ADJUSTING THE BOTTOM LINE CIVIL PENALTY TO THE $35,000 - $40,000 RANGE.

Defendants (1)

• SOUTHERN PACIFIC PIPE LINESNamed in complaintNamed in settlement

Facilities (2)

• SANTA FE PACIFIC PIPELINE

  4149 SOUTH MAPLE AVENUE, FRESNO, CA, 93725

  Registry ID: 110000899001

• SANTA FE PACIFIC PIPELINE

  4149 SOUTH MAPLE AVENUE, FRESNO, CA, 93725

  Registry ID: 110000899001

Statutes cited

• CAA 111 — New Source Performance Standards
• CAA 110 — Implementation Plan for National Primary and Secondary Ambient Air Quality Standards

Enforcement conclusions (1)

• SOUTHERN PACIFIC PIPELINESentered 1986-07-02

  Primary law: CAA

  Federal penalty: $77,500

Timeline (7 milestones)

• 1986-02-28Referred To Dept Of Justice
• 1986-07-02Final Order Lodged
• 1986-07-02Final Order Entered
• 1986-07-02Referred TO U.S. Attorney
• 1986-07-02Complaint Filed With Court
• 1986-07-02Concluded
• 1987-02-18Enforcement Action Closed