Detailed Information on the
Department of Transportation Pipeline Safety Assessment

Include language in pipeline safety grant agreements and other transactions to ensure State program partners commit to and report on the program's long-term and annual goals.

Develop and collect baseline data for two efficiency measures.

We have completed the program-wide strategic plan, including research and development activities as recommended by OMB

Enhance program resources for States to address the performance of gas transmission pipelines. The Administration also will allocate resources to provide improved technical oversight and evaluation of program partners.

PHMSA has sent letters to the Chairmen of the State programs and had follow-up meetings with the States to communicate long-term goals with the State partners and will continue to send a chairman letter out annually communicating PHMSA goals to states.

Measure: Number of serious incidents (involving death or major injury) for natural gas and hazardous liquid pipelines.

Explanation:Directly supports DOT and PHMSA strategic goals on Safety Performance to reduce deaths, injuries, property damage and economic disruptions from pipeline incidents. Prior to 2006, this measure was the number of natural gas incidents and hazardous liquid accidents.

Measure: Hazardous liquid pipeline spills in high consequence areas (HCAs)

Explanation:This measure focuses on accidents that present a particular potential for environmental harm due to their location. HCAs include commercially navigable waterways, areas with concentrated population, and drinking water or ecological resources that are unusually sensitive to environmental damage from a hazardous liquid pipeline release.

Measure: Number of all pipeline incidents caused by excavation damage.

Explanation:Goal is to reduce incidents by 5% per year, from 119 in 2000 to 87 in 2006. Excavation damage is the leading cause of all pipeline incidents/accidents.

Measure: Number of pipeline incidents caused by corrosion.

Explanation:Corrosion is the second leading cause of incidents. To be consistent with the Safety Performance Outcome, this annual output is aimed to achieve a 5% annual reduction in all corrosion caused incidents from 2000 to 2006.

Measure: Time required to close a Corrective Action Order after a safety sensitive incident.

Explanation:OPS is in the process of developing this efficiency measure, which will measure the efficiency of the response to incidents. OPS is collecting data on this measure and in the process of developing a baseline and a realistic but achievable target.

Measure: Unrecovered oil spill costs per costs for implementing IMP in HCAs

Explanation:Methodology would be to calculate net loss for spills in high consequence areas and potentially use a moving average to normalize the spill variability over time. OPS collected 5-year data on HCA spills and is in the process of analyzing the data to capture an effective efficiency measure. OPS is in the process of developing a baseline and a realistic but ambitious target.

Is the program purpose clear?

Explanation: The purpose of the pipeline safety program, which is administered by DOT's Research and Special Programs Administration's (RSPA's) Office of Pipeline Safety (OPS), is to ensure the safe, reliable, and environmentally sound operation of the Nation's pipleine transportation system. The mission of the program is to: (1) develop, issue, and enforce minimum pipeline safety standards through consensus and regulations; (2) inspect pipelines and enforce regulations on interstate and intrastate pipelines with State support; (3) collect, compile, and analyze pipeline safety and operating data; (4) conduct training; and (5) conduct research and development (R&D).

Evidence: The peer-developed mission statement, based on the pipeline safety activities authorized in statute, is posted on OPS website http://ops.dot.gov. Title 49 merged and codified the Natural Gas Pipeline Safety Act of 1968 (P.L. 90-481) and the Hazardous Liquid Pipeline Safety Act of 1979 (P.L. 96-129), which authorized activities regarding the regulation of natural gas and hazardous liquid pipeline industries. Section 60102 of Title 49 identifies objectives regarding the establishment of minumum safety standards for pipeline transportation and for pipeline facilities. The Pipeline Safety Act of 1992 (P.L. 102-508), the Accountable Pipeline Safety and Partnership Act of 1996 (P.L. 104-304), and the Pipeline Safety Improvement Act of 2002 (P.L. 107-355) were enacted to enhance the delivery of hazardous liquid and natural gas in a safe and environmentally feasible manner.

Does the program address a specific and existing problem, interest or need?

Explanation: There is clear need for national safety standards to create a uniform and efficient regulatory system for interstate and intrastate pipelines. Despite relatively safe operations of pipeline systems, incidents can result in severe environmental damages as well as loss of human life, as evidenced by at least two recent incidents, one in a hazardous liquid line in Bellingham, WA and another in a natural gas transmission line near Carlsbad, NM. RSPA's pipeline safety program addresses the need for national safety standards by developing and enforcing uniform regulations, which cannot be accomplished by individual states and local governments. By developing a uniform system of regulation, the cost of regulation is decreased, efficiences are achieved, and safety is increased. In addition, strong Federal enforcement of nationally uniform standards increases public confidence in the Nation's pipeline system.

Evidence: The need for national pipeline safety standards is evidenced by the miles of pipelines that are regulated and by the continued occurrence of pipleine incidents. OPS regulates 2.2 million miles of natural gas and petroleum pipelines. In 2003, there were 124 incidents (including 5 injuries) in hazardous liquid pipelines. There were 96 incidents in natural gas transmission lines with 1 death and 8 injuries and resulting property damages translated into $39.5 million. There were also 143 incidents in natural gas distribution lines with 11 fatalities, 58 injuries and $22.3 million in property damages in 2003. There was a net loss of 50,000 Bbls. of hazardous liquid in 2003 (accident/incident summary statistics available at http://ops.dot.gov/stats.htm). In addition, there is demand for uniform and national, rather than local, regulation of interstate pipeline to increase efficiency and safety.

Is the program designed so that it is not redundant or duplicative of any other Federal, state, local or private effort?

Explanation: OPS leadership of the pipeline safety program is well defined at all levels of government and provides for a division of labor in monitoring pipeline operations that is prescribed through administrative agreements. To avoid duplication of efforts at the Federal level, OPS has developed a number of MOUs with other Federal agencies that have overlapping responsibilities to clearly define their respective operating authorities. Federal statutes provide for complementary Federal and state roles for inspection, regulation of intrastate facilities, and emergency response. OPS also coordinates pipeline safety activities with the private pipeline industry to prevent redundancy. OPS coordinates R&D efforts with other Federal, state, and local agencies, and with industry through a number of annual and periodic activities. Additionally, the Technical Pipeline Safety Standards Committee (TPSSC) and the Technical Hazardous Liquid Pipeline Safety Standards Committee (THLPSSC) ensure there is no duplication of efforts at the state and local level.

Evidence: (1) OPS has signed MOUs with several Federal agencies, including the Minerals Management Service, Maritime Administration, Environmental Protection Agency, Coast Guard, Transportation Security Agency, and Federal Energy Regulatory Commission, to define respective operating authorities. (2) In 2004, OPS published an overview of state participation in the Federal pipeline safety program. (3) To see how OPS coordinates R&D efforts with states, local government, and industry through a number of annual and periodic activities, see R&D Draft Strategic Plan, Sections IV, V, and VI. See also the NAPSR document illustrating specific state coordination. (4) Under 49 USC section 60115, TPSSC and THLPSSC review and report on technical feasibility, reasonableness, cost-effectiveness, and practicability of new rules and amendments to existing rules and ensure there is no duplication in OPS efforts at the Federal, state, or local level.

Is the program design free of major flaws that would limit the program's effectiveness or efficiency?

Explanation: The pipeline safety regulatory and non-regulatory (grant, training, outreach, and R&D) programs are designed using a risk-based approach to maximize the benefits and impact of the programs in a cost-effective way. Using a risk-based approach, OPS, with the input of Federal, state, and local stakeholders, identifies priorities and allocates resources through various mechanisms in order to address priorities in the most effective and efficient manner. There is no evidence that another approach would be more efficient or effective to acheive the intended purpose.

Evidence: (1) OPS utilizes the national consensus standards and participates in voluntary standards bodies in compliance with OMB Circular A-119 (www.whitehouse.gov/omb/circulars/a119/a119.html). (2) A list of appropriate industry standards that have been included by references in regulations (pending Federal Register Notice). (3) Per 49 USC section 60115, the Technical Committees (TPSSC and THLPSSC) serve as peer review committees for OPS programs and advise on program design. (4) For a list of Federal, state and industry OPS partners, see ops.dot.gov/partners.htm

Is the program effectively targeted, so that resources will reach intended beneficiaries and/or otherwise address the program's purpose directly?

Explanation: The pipeline safety program is designed to effectively target resources to meet the program purposes. In order to reach the ultimate intended beneficiary -- the American public -- funds are directed to various beneficiaries to address different elements of the pipeline safety program. Program funds are directed to Federal, state, and local inspectors and emergency responders through training and community outreach. Training and outreach are fundamental to ensure a thorough understanding of regulations and to educate inspectors in compliance requirements, inspection techniques, and enforcement procedures. Inspectors help create and enforce a uniform national regulation of pipelines, which enables efficiency in pipeline operations. As a result, the American public benefits from safe and reliable energy delivery from a system that minimizes energy supply disruption. In addition, funds are directed toward R&D activities, which provide the technical and analytical foundation necessary to plan, evaluate, and implement the pipeline safety program.

Evidence: (1) RSPA's FY 2005 budget submission shows how resources are directed to program beneficiaries to achieve program purposes and goals (pages 58-72). (2) A brief description of the Federal/state partnership program and how the program intends to reach its beneficiaries through grants, training, and outreach activities and a list of current state partners can be found at ops.dot.gov/partnership.htm (3) Information on OPS sponsored trainings is available at www.tsi.dot.gov/dti60/. (4) OPS research initiatives can be found at primis.rspa.dot.gov/rd/index.htm.

Does the program have a limited number of specific long-term performance measures that focus on outcomes and meaningfully reflect the purpose of the program?

Explanation: The pipeline safety program has two meaningful long-term outcome measures that directly support RSPA's strategic goals on safety and environment. These, in turn, support DOT's strategic plans for safety and environmental stewardship. The strategic goal for pipeline safety is to reduce deaths, injuries, property damage and economic disruptions from pipeline accidents (final outcome). The associated intermediate outcome and long-term measure is to reduce the total number of natural gas incidents and hazardous liquid accidents. To achieve RSPA's goal on environment, which supports DOT's strategic goal of environmental stewardship, OPS's strategic goal and long-term measure is to reduce the amount of oil and other hazardous liquids spilled from pipelines (intermediate outcome).

Evidence: (1) RSPA FY 05 Budget submission to Congress lists long-term performance measures that illustrate the purpose of the OPS program and ties the budget requests with the outcomes. (2) DOT Performance Plan Safety Goal - www.dot.gov/PerfPlan2004/safety_pipeline.html. (3) DOT Performance Plan Environmental Goal; www.dot.gov/PerfPlan2004/humanperf.html. (4) DOT has developed a logic model that illustrates the relationship between DOT strategic goals, RSPA/OPS final and intermediate outcomes, and annual outputs.

Does the program have ambitious targets and timeframes for its long-term measures?

Explanation: Improving life safety and reducing pollution from pipes are ambitious goals, given the increased risk of pipelines being damaged in construction of encroaching housing and business development. OPS has specific quantified targets for the measures described in 2.1.?? Reduce all pipeline incidents by 5% per year from 381 in 2000 to 280 in 2006.?? Reduce the volume of hazardous liquid spilled from pipelines by 6% per year, from 0.0131 tons per million ton-miles shipped in 2000 to 0.0110 ton per million ton-miles shipped in 2006.

Evidence: (1) RSPA FY 05 Budget submission to Congress lists long-term performance measures that illustrate the purpose of the OPS program and ties the budget requests with the outcomes. (2) DOT Performance Plan Safety Goal - www.dot.gov/PerfPlan2004/safety_pipeline.html. (3) DOT Performance Plan Environmental Goal; www.dot.gov/PerfPlan2004/humanperf.html.

Does the program have a limited number of specific annual performance measures that can demonstrate progress toward achieving the program's long-term goals?

Explanation: The program has annual performance measures that can demonstrate progress toward achieving the program's long-term goals. Progress towards these goals is measured annually. OPS is in the process of collecting and analyzing baseline data to develop efficiency measures that can meaningfully track the progress of the program. The efficiency measures will be ready to be tracked in FY05.

Evidence: (1) RSPA FY 05 Budget submission to Congress lists long-term performance measures that illustrate the purpose of the OPS program and ties the budget requests with the outcomes. (2) In addition to the performance measures in the budget document, OPS also uses other performance measures internally to measure annual performance (e.g., SES Performance Plan for OPS Associate Administrator submitted to RSPA Administrator).

Does the program have baselines and ambitious targets for its annual measures?

Explanation: OPS develops baselines and ambitious targets for all of its annual measures. ?? Number of pipeline incidents caused by excavation damage: The baseline for reducing incidents was 118 in 2000 and the target is 87 in 2006.?? Number of pipeline incidents caused by corrosion: The baseline for reducing incidents was 69 in 2000 and the target is 51 in 2006. ?? Efficiency measures are under development regarding unrecovered oil spill costs per costs for implementing the Integrity Management Program in high consequence areas and time required to issue a Corrective Action Order after a safety sensitive incident.

Evidence: (1) RSPA FY 05 Budget submission to Congress lists long-term performance measures that illustrate the purpose of the OPS program and ties the budget requests with the outcomes. (2) In addition to the performance measures in the budget document, OPS also uses other performance measures internally to measure annual performance (e.g., SES Performance Plan for OPS Associate Administrator submitted to RSPA Administrator).

Do all partners (including grantees, sub-grantees, contractors, cost-sharing partners, and other government partners) commit to and work toward the annual and/or long-term goals of the program?

Explanation: While partners submit performance data to OPS, there often is not a clear linkage between the data submitted and the program's long-term and annual goals. For example, while state grant contracts require performance agreements, these agreements focus on tracking the leading causes of incidents, with no specific mention of buy-in of long-term outcome goals. Federal partners more explicitly commit to the program's goals through MOUs, such as the recent MOU signed on environmental streamlining, which is an example of Federal partners committing to shared goals related to pipeline safety. Also, R&D partners share OPS goals as indicated in program solications.

Evidence: MOUs and cooperative agreements reference goals of the OPS program or require certain performance standards that support achievement of the goals. States have annual performance agreements as a part of their grant contracts, and OPS audits programs to ensure that they are following policies.?? (1) Overview of State participation in federal pipeline safety program (2004) lists performance factors used by OPS to allocate grant funds to a State Agency (2) Letter from the Associate Administrator to the State Pipeline Safety Managers (April 9, 2004) - numeric points are attached for achieving specific levels of performance (3) State Interagency Agreement and Certification applications include performance requirements (4) Cooperative agreement with Common Ground Alliance (5) MOUs with FERC, EPA, and Coast Guard (6) Draft Environmental Streamlining MOU.

Are independent evaluations of sufficient scope and quality conducted on a regular basis or as needed to support program improvements and evaluate effectiveness and relevance to the problem, interest, or need?

Explanation: Independent evalations of the pipeline safety program have been conducted frequently since 2000, including seven GAO reports. These evaluations have been of sufficient scope, quality, and independence and have examined how well the program is accomplishing its mission and meeting its long-term goals. The PSIA 2002 requires the DOT IG to periodically report to Congress on OPS's progress in implementing recommendations (most recently in June 2004). GAO also periodically reviews portions of the program, most recently reviewing the enforcement program (July 2004). Regular and ad-hoc reviews of the program include: (1) quarterly reviews by each Technical Pipeline Safety Standards committees on technical feasibility, cost-effectiveness, and practicability of new and amendments to existing gas and liquid rules; (2) DOT IG's periodic reviews on OPS's progress in implementing recommendations; (3) seven recent GAO reports providing independent assessments; (4) addressing the critical issues raised by both Congressional oversight and public advocacy groups, OPS is re-examining its enforcement process.

Evidence: (1) The Technical Safety Standards committees charters are given in 49 USC section 60115. Sub-section (e) states the quarterly meeting requirements. (2) DOT IG Report No. SC-2004-064, "Actions Taken and Needed for Improving Pipeline Safety," (www.oig.dot.gov/item_details.php?item=1344). (3) Examples of GAO reports are available at www.gao.gov/new.items/d04801.pdf, www.gao.gov/decisions/majrule/d04351r.pdf and www.gao.gov/new.items/d02785.pdf. It should be noted that some GAO reports suggest program improvements but do not address the effectiveness or relevance of the program. (4) OPS internal document titled "New OPS Enforcement, Program Performance and Evaluation Organizational Structure and Implementation Plan.

Are Budget requests explicitly tied to accomplishment of the annual and long-term performance goals, and are the resource needs presented in a complete and transparent manner in the program's budget?

Explanation: OPS's budget goals are linked to RSPA's FY 2005 Budget request to Congress and show the relationship between DOT strategic goals for safety and environment and resource requests, including FTE and positions. The budget requests are broken down into three major categories - operations, research and development, and grants for the safety and environmental performance goals individually. The explanations in the budget request also reflect the relationship between resource allocation decisions and performance measures. DOT does not yet have a full cost accounting system, so there are no marginal cost comparisons, but OPS has developed sub-goals, which in later years will have budget requests tied to them as well.

Evidence: (1) FY 05 Budget, pages 58, 62, 81, 83, related budget request to safety and environmental goals. FY05 Budget, pages 63-66, discusses sub-goals.

Has the program taken meaningful steps to correct its strategic planning deficiencies?

Explanation: OPS has taken actions to address deficiencies that have been identified, such as improved workforce planning, communication, and data quality to implement the program's integrity management approach within an ambitious schedule. OPS is also in the process of drafting a strategic planning document that will allow OPS to review progress toward goals and identify any gaps.

Evidence: (1) GAO report titled Pipeline Safety and Security (GAO-02-785) examined the Integrity Management Plan and recommended improved workforce planning and communication. (2) In response, OPS is evaluating its workforce planning (draft SOW for workforce plan) for an up-to-date assessment of current and future staffing and training needs and an examination of workforce deployment; (3) Draft OPS Strategic Plan.

If applicable, does the program assess and compare the potential benefits of efforts within the program to other efforts that have similar goals?

Explanation: Bench-marking and peer review techniques have often been used by OPS to consider strategic approaches to planning the delivery of training and execution of enforcement. OPS assesses and compares the potential benefits of R&D activities within the program using several external reviews, safety advisory committees, and program/project peer reviews. OPS conducts external program reviews through Blue Ribbon Panel meetings with representatives from other government agencies, research funding organizations, the pipeline industry and its associations, and standards development organizations. R&D project results are reviewed both internally and externally by the Technical Advisory Committees (TPSSC and THLPSSC). OPS also compares its R&D activities to other similar Federal efforts through a MOU with DOE and its National Energy Technology Laboratories, DOI/MMS, DOC's NIST.

Evidence: (1) Blue Ribbon Committee Meetings; http://primis.rspa.dot.gov/rd/mtg_61003.htm (2) To identify technological gaps, a joint government/industry R&D forum was held in December 2003; http://primis.rspa.dot.gov/rd/mtg_121103.htm (3) Draft 5-year R&D Plan. (4) MOU between RSPA/OPS, DOE/NETL, and DOT/NIST; (5) Draft OPS R&D Program Logic Model with attached documents; (6) For internal assessments, please see OPS Draft R&D Program Strategic Plan section VI. Strategy and Implementation - Assessing and comparing benefits (page 26). (6) For evidence of analysis comparing proposed approaches with alternative strategies please see OPS R&D Program Strategic Plan section VI. Strategy and Implementation - Assessing and comparing benefits (page 26).

Does the program use a prioritization process to guide budget requests and funding decisions?

Explanation: Risk-based prioritization has been a cornerstone of OPS strategies for the past 10 years. The prioritization of R&D expenditures is based on analyses of the pipeline failure statistics database and is revised annually in consultation with a Blue Ribbon Panel, the Technical Advisory Committees (TPSSC and THLPSSC) and OPS's Federal R&D partners. The R&D priorities are used to guide the budget requests as reflected in the PSIA 2002. R&D priorities are published in a series of four Broad Agency Announcements (BAAs) issued in 2002 through 2004 to solicit project proposals. There is a documented process (OPS Draft R&D Program Strategic Plan) of how OPS takes the different approaches and determines the final priorities .

Evidence: (1) OPS R&D website; primis.rspa.dot.gov/rd/mtg_121103.htm (2) Technical Advisory Committee (TPSSC and THLPSSC) Meeting Minutes; www.cycla.com/opsiswc/wc.dll?webmtg~QueryPage~&sub=13&lp=7&u=lp (3) BAAs in the OPS announcements primis.rspa.dot.gov/rd/announcements.htm (4) Please see OPS R&D Program Strategic Plan section VI. Strategy and Implementation - Establishing Priorities for funding R&D (page 23). This outlines how OPS takes the different approaches and determines the final priorities.

Are all regulations issued by the program/agency necessary to meet the stated goals of the program, and do all regulations clearly indicate how the rules contribute to achievement of the goals?

Explanation:  

Evidence:  

Does the agency regularly collect timely and credible performance information, including information from key program partners, and use it to manage the program and improve performance?

Explanation: Data are used to focus inspection resources, evaluate effectiveness of changes in equipment and practices, monitor operator performance trends, and support decisions about customized operator approaches to address performance issues. Data systems include the Pipeline Information Processing Enforcement System (PIPES), Integrated Operator Compliance System (IOCS) and Online Data Entry System (ODES). These systems collect and distribute information on hazardous materials spills, pipeline annual and incident reporting data, and regulatory activities. The data are used to respond to inquiries by personnel from RSPA, DOT, other Federal, state and local government agencies, members of Congress, the news media and the private sector. OPS also regularly collects State performance data through FedSTAR, a web based program.

Evidence: (1) Exhibit 300 submitted to OMB; (2) OPS Pipeline Accident Data Improvement Plans; (3) State programs through FedSTAR; (4) PIPES, IOCS and ODES are in the OPS internal system currently, however OPS is converting the system to be web-based by June 04; (5) Performance Tracking & Monitoring, and Data Initiatives presentation by Stacey Gerard, Jan. 29, 2003 (http://primis.rspa.dot.gov/comm/Bellevue2003/Bellevue06_Perf_Msrs_012903.pdf).

Are Federal managers and program partners (including grantees, sub-grantees, contractors, cost-sharing partners, and other government partners) held accountable for cost, schedule and performance results?

Explanation: Performance based grant managements used for over a decade. In the Federal/State partnership program, a grantee is rated based on performance measures identified as part of that grantee's program. ?? States are held accountable for performance and funds can be withheld in cases where performance is unacceptable.?? Performance plans for managers include outcome goals. R&D managers are held accountable and provide oversight for program cost, schedule, and performance though several measures such as maintaining qualified COTRs, annual management/COTR meetings, and an Internet-based R&D Management Information System, which will alert management of contractor or COTR non-performance. These items ultimately tie to R&D Manager Performance Reviews required annually.

Evidence: (1) Attachment 8 of the State Certification Document; (2) SES Performance Plans for this year; (3) Draft R&D Strategic Plan (Section 4.1 Effective and Efficient Program Management & Section 6 under Managing for Results); (4) Annual Management/COTR Meeting; (5) Internet based R&D Management Information System (under development), Current system is PRIMIS Document Log. RSPA Procurement tracks COTR Qualification Period.

Are funds (Federal and partners') obligated in a timely manner and spent for the intended purpose?

Explanation: Funds are obligated and spent for the intended purpose in a timely manner. Grantees are subject to a single state audit if required under Circular A-133 (2 states in liquid program, approximately 22 in gas program). There have been no findings under these audits. An internal audit of RSPA accounting, a required by Congress, found adequate procedures in place for reporting obligations and expenditures. The IG has not audited RSPA's use and payment of funds. End of fiscal year unobligated balances are from state grants distributed in the next fiscal year based on calendar year performance. R&D funds are obligated according to guidance in the BAAs and FARs, which is consistent with the appropriation language. Contractor expenditures are under contracts consistent with the FAR. COTRs monitor contractor performance through monthly/quarterly reports and the R&D Management Information System. Invoices are not paid unless in accord with contract terms and controlled through the DOT MarkView Invoicing System. No Anti-Deficiency Act violations have been identified.

Evidence: (1) End of year fund status report shows limited unobligated balances; (2) Copy of the State audit; (3) DOT MarkView Invoicing System; (4) BAA 1-4 Language, Federal Acquisition Regulations; (5) Internet based R&D Management Information System (under development), Current system is PRIMIS Document Log. RSPA Procurement tracks COTR Qualification Period. (6) IG Report SC-2004-064, 'Actions Taken & Needed for Improving Pipeline Safety' (www.oig.dot.gov/item_details.php?item=1344).

Does the program have procedures (e.g. competitive sourcing/cost comparisons, IT improvements, appropriate incentives) to measure and achieve efficiencies and cost effectiveness in program execution?

Explanation: OPS and RSPA have established procedures for measuring and achieving efficiencies and cost effectiveness, including competitive sourcing efforts and IT investments. RSPA/OPS conducted a FAIR Act inventory for the President's Manangement Agenda competitive sourcing initiative, and compares costs and considers alternatives as specified in FAR. Almost 90% of OPS' contractual actions are competitive. OPS also incentivizes performance contracts. OPS used an audit of a professional service company in contract negotiations to ensure competitive rates. OPS uses web-based IT improvements, designing and developing information systems to allow appropriate access to the public, States and OPS staff. As new topics are added to the web site, OPS reuses the design to save costs. OPS develops performance metrics, tracks expenditures, and considers alternatives for IT improvements that meet OMB Exhibit 300 requirements, mapping to the Federal Enterprise Architecture Business Reference Model. Data collection is in progress for to establish a baseline for an efficiency measure regarding unrecovered oil spilled in high consequence areas per IMP investment.

Evidence: (1) Fair Act Inventory (www.dot.gov/ost/m60/fairact/index.html#inventory1); (2) Exhibit 300; (3) Exhibit 52; (4) Common Ground Alliance contract; (5) Contract that includes incentives; (6) Summary of competitive vs. non-competitive contractual actions (4/27/04 e-mail from Warren Osterberg).

Does the program collaborate and coordinate effectively with related programs?

Explanation: Building and using alliances is key to OPS's ability to lead change in safety practices, an approach on which the program depends heavily. Collaboration and coordination achieves efficiencies in areas such as environmental streamlining, which brings many agencies together to develop more efficient, timely review processes. Collaboration with states through the grant program allows OPS to use states as agents to accomplish program goals, such as field inspections. OPS also coordinates with industry associations on activities such as public outreach during rulemaking. OPS also works with safety organizations, such as the Common Ground Alliance (CGA), on issues such as the creation of industry standard practices. Cooperation with other programs that has lead to improved management decisions includes joint benchmarking and identifying security issues after 9/11. The R&D program cooperates with other Federal R&D programs on joint research projects.

Evidence: (1) List of MOUs with agencies including FERC, MMS, OSHA, NTSB, and EPA; (2) Cooperative agreements with CGA and other organizations; (3) Enhanced Method For Prioritizing Risk-Base Standard Inspections Conducted by the Office of Pipeline Safety, Oak Ridge National Laboratory, 1997 (Final Report); (4) External organization, AOPL; www.aopl.org/safety/standards.html; (5) External organization, INGAA; www.ingaa.org/safety/index.php?page=main critique OPS programs and offer solution; (6) Draft Environmental streamlining MOU.

Does the program use strong financial management practices?

Explanation: The DOT and RSPA use DELPHI for its accounting system, which incorporates strong financial controls. In addition, RSPA uses RAMIS for internal tracking of programmatic expenditures. Data is downloaded monthly from DELPHI and RAMIS and reconciled. When obligating funds for OPS programs, including R&D, procurement requests and contractual documents are created and tracked with the PRISM acquisition system. RAMIS also captures these program expenditures and performs a second level check for greater accountability. OPS also has a process to review budgets internally through a spreadsheet program, Spend Plan. RSPA does not have any material weaknesses or erroneous payments related to this program.

Evidence: (1) RSPA Audit Report; (2) Report to Congress, June 2004, documenting RSPA accounting processes; (3) Spend Plan documentation.

Has the program taken meaningful steps to address its management deficiencies?

Explanation: OPS is addressing management deficiencies by developing a strategic plan, reorganizing to better focus enforcement, and addressing workforce planning. OPS has developed a draft strategic plan that will align OPS goals and performance measures with RSPA and DOT, which will provide a framework for better strategic management of resources. Deficiencies in the enforcement program have been identified by OPS and GAO, and OPS has taken steps to correct these deficiencies, such as revising enforcement policies and creating the position of Enforcement Chief to enforce, audit, research, and train inspectors. Management reviews uncovered that the distribution of workload across the organization was causing bottlenecks, so OPS reorganized to distribute the workload more broadly. OPS continues to use workforce planning to improve management of the program. A workforce planning and analysis study is expected to be completed by summer 2004 that will examine optimal regional configurations, staffing, and inspection methods.

Evidence: (1) OPS Draft Strategic Plan. (2) GAO Report GAO-04-801, "Management of the Office of Pipeline Safety's Enforcement Program Needs Further Strengthening," July 2004 (www.gao.gov/new.items/d04801.pdf. (3) Position description for Enforcement Chief. (4) SOW for workforce planning study. (5) New OPS Enforcement, Program Performance and Evaluation Organizational Structure and Implementation Plan. (6) OPS organizational chart.

Does the program have oversight practices that provide sufficient knowledge of grantee activities?

Explanation: Both electronic monitoring and peer review groups are used to monitor grantees, and these activities are supported by regular regional conferences to report results. OPS uses the FedStar reporting system to track expenditures by grantees. Grantees submit information on a 270 Form through FedStar, and the form is also kept in hardcopy. OPS reviews and monitors the performance of the State agencies participating in the pipeline safety program through its regional offices. OPS conducts site visits to all grantees. In the FY04 Budget, OPS received an additional position to provide additional oversight of State grants. OPS is authorized to reimburse a state agency up to 50 percent of the actual cost for carrying out its pipeline safety program, including the cost of personnel and equipment. The formula used to allocate funds includes performance factors such as the extent to which the State asserts safety jurisdiction over pipeline operators, whether the state has adopted all Federal requirements, and number and qualifications of State pipeline safety inspectors.

Evidence: (1) Overview of State participation in Federal pipeline safety program (2004) lists performance factors used by OPS to allocate grant funds to a State agency; (2) Letter from the Associate Administrator to the State Pipeline Safety Managers regarding levels of performance, April 9,2004; (3) 2003 Guidelines for States participating in Pipeline Safety Program; (4) Model agreements: Pipeline Safety Evaluation Forms; (5) Form 270 in FedStar tracks grantee expenditures.

Does the program collect grantee performance data on an annual basis and make it available to the public in a transparent and meaningful manner?

Explanation: OPS collects grantee performance data annually, as each grantee is required to submit an annual report on the results of their program. These reports are then aggregated to form an annual output measure. Results are reported to Congress and performance data is released to other grantees within the program. However, the performance data is not made publicly available in a useful and transparent manner. A State profile project is in progress to post summary data on the web for the public. The templates are complete and some information in that format has been posted in response to an incident, but information for all states is not yet available.

Evidence: (1) RSPA/OPS State Grants Program Fact sheet; (2) 2003 Guidelines for States participating in Pipeline Safety Program; (3) Form 270 in FedStar tracks grantee expenditures.

For R&D programs other than competitive grants programs, does the program allocate funds and use management processes that maintain program quality?

Explanation: Nearly 100% of R&D contracts, cooperative agreements, other transactional authorizations, interagency agreements, and grants are awarded on a clear competitive process that includes a qualified assessment of merit, a process recently reviewed by both the DOT IG and the GAO. In some cases, OPS funds research through Interagency Agreements (IA) with other Federal programs that are not competitively awarded. These IAs are developed with contractual milestones and deliverables which maintain program quality, require results delivered, and are consistent with the FAR. Examples are IA with NIST and a planned IA with DOE's National Energy Technology Laboratory, where OPS is funding research aligned with directives from PSIA 2002. The agencies named in PSIA 2002 meet quarterly to collaborate and coordinate efforts while providing oversight for interagency research activities.

Evidence: 1) Federal Acquisition Regulations. (2) Interagency Agreement with NIST. (3) Meeting notes from Quarterly PSIA 2002 Group Meetings; http://primis.rspa.dot.gov/rd/ under meetings. (4) Five-Year Interagency Research and Development Program Plan. (5) Pipeline Research MOU is signed with the DOT, DOE, and the NIST (http://primis.rspa.dot.gov/rd/mou.htm). (6) Draft OPS R&D Program Strategic Plan. (7) Draft OPS R&D Performance Plan. (8) Draft OPS R&D Program Logic Model. (9) Interagency agreement with NIST.

Did the program seek and take into account the views of all affected parties (e.g., consumers; large and small businesses; State, local and tribal governments; beneficiaries; and the general public) when developing significant regulations?

Explanation: OPS conducts extensive outreach to obtain input from affected parties, including web-based technology and extensive use of public meetings at locations around the country. In addition to using the Federal Register, outreach includes posting information on the OPS website, invitational travel to bring in affected populations, work with tribal governments, industry meetings, workshops, and public meetings. In addition, an advisory committee reviews all rulemakings. All significant rulemakings were reviewed by OMB and included appropriate analyses. Since 1999, OPS has followed the guidelines developed in 'A collaborative framework for OPS's cost-benefit analysis,' a document developed by the joint OPS stakeholder workgroup with economic efficiency as a focal point for all OPS regulations.

Evidence: (1) Integrity Management Notices (2) Integrity Management Industry comments (3) Integrity Management Technical Advisory Committee Meetings 1- 3; (http://primis.rspa.dot.gov/iim) OPS prepares all regulatory impact assessments in accordance with OMB guidelines and the final IMP rules include analysis required for Regulatory Flexibility Act. OPS also prepares its cost-benefit analyses in accordance with a document developed through stakeholder committees in accordance with OMB Circular A-94. A Collaborative Framework for OPS's Cost-Benefit Analysis: http://ops.dot.gov/document/cba_rpt.pdf (4) Examples from final regulations (gas and liquid IMP rules).

Did the program prepare adequate regulatory impact analyses if required by Executive Order 12866, regulatory flexibility analyses if required by the Regulatory Flexibility Act and SBREFA, and cost-benefit analyses if required under the Unfunded Mandates Reform Act; and did those analyses comply with OMB guidelines?

Explanation: OPS rules were prepared using sound analyses and all OPS regulation comply with OMB guidelines to prepare regulatory impact analysis, regulatory flexibility analysis, and analysis based on the Unfunded Mandates Reform Act. OPS also follows guidance prepared by stakeholder committees regarding preparation of cost-benefit analyses. In addition, the Technical Advisory Commitees review OPS cost-benefit analyses as part of their charter to ensure proper documentation and analysis.

Evidence: (1) Federal Register Notices posted by OPS: http://primis.rspa.dot.gov/gasimp/documents.htm. (2) Industry comments and actions taken: http://primis.rspa.dot.gov/gasimp/documents.htm. (3) Discussion of the Proposed Gas IM Rule: Comparison of Costs and Discussion of Benefits Draft, July 22, 2003, TPSSC: http://www.cycla.com/opsiswc/docs/s8/p0057/TPSSC_073103Mtg_Summary_of_Gas_IM_Benefits_072203.pdf. (4) A Collaborative Framework for OPS Cost-Benefit Analyses, September 1999: http://ops.dot.gov/document/cba_rpt.pdf.

Does the program systematically review its current regulations to ensure consistency among all regulations in accomplishing program goals?

Explanation: OPS reviews portions of its program periodically and has recently revamped its regulatory regime to incorporate signficant new regulations. Industry groups and State programs provided OPS with a list of suggested items to fix in the regulations, and OPS is working on reviewing and making changes as appropriate. A periodic update of required standards is posted in the docket. In the past few years, OPS has issued a number of new regulations which in turn forced a review of the existing regulations to ensure consistency among all regulations issued by OPS. The Technical Advisory Committees (TPSSC and THLPSSC) also review current regulations to ensure consistency among all regulations. OPS meets four times a year with the National Association of Safety Representatives to obtain input on regulations. OPS posts notices in the Federal Register asking for suggested revisions.

Evidence: (1) The recent update of standards incorporated by reference (keep up to date with ASME and other technical standards) will be posted soon in the Federal Register. (2) Federal Register notices to solict suggested revisions.

Are the regulations designed to achieve program goals, to the extent practicable, by maximizing the net benefits of its regulatory activity?

Explanation: OPS regulations are designed to achieve program goals and maximize net benefits by identifying minimum standards for pipeline design, construction, inspection, testing, operation, and maintenance for operators. Rules are designed to allow companies the flexibility to achieve goals at the lowest cost possible by requiring the companies to achieve a goal without telling them how. OPS is required to conduct cost benefit analyses on regulations and obtain a favorable vote on the results by its Technical Advisory Committees. Programs are periodically evaluated and revised on the basis of external stakeholder input and internal operational needs, including TPSSC and THLPSSC reviews.

Evidence: (1) OPS conducts cost-benefit analyses for all of its regulations in accordance with OMB Circular A-94 and guidelines developed by stakeholders titled "A Collaborative Framework for OPS's Cost-Benefit Analysis" (http://ops.dot.gov/document/cba_rpt.pdf). (2) Cost benefit analysis of IMP rules. (3) Minutes from the Technical Advisory Committee meetings.

Has the program demonstrated adequate progress in achieving its long-term performance goals?

Explanation: To a large extent, the program has demonstrated progress in achieving the long-term DOT-wide strategic goal of reducing the number of pipeline incident rate. Over the past 10 years, the total number of pipeline incidents has decreased from 467 in 1994 to 368 in 2003. However, while the program has achieved its goals for hazardous liquid pipeline incidents, it has not achieved its goals for gas transmission and distribution pipeline incidents. Since 1994, OPS has shown progress toward the strategic goal of downward trends in both number of incidents and rate of hazardous liquid released. While the year to year performance related to this goal has varied, it is expected that the downward trend of incidents will continue in a more smooth curve as the full effects of the IMP are realized. State partners commit to long-term outcome targets when signing interagency agreements.

Evidence: (1) Accident Summary Statistics for hazardous liquid operators by cause, 2003 (ops.dot.gov/stats/LQ03_CS.HTM). (2) Incident Summary statistics for natural gas transmission lines by cause, 2003 (ops.dot.gov/stats/NGTRAN03.HTM). (3) Incident summary statistics for natural gas distribution lines by cause, 2003 (ops.dot.gov/stats/NGDIST03.HTM). (4) FY 2005 RSPA budget justification, pages 61-63. (5) DOT IG Report No. SC-2004-064, "Actions Taken and Needed for Improving Pipeline Safety," (www.oig.dot.gov/item_details.php?item=1344). (6) Op-Ed Letter from NTSB ex-chairman, Jim Hall (www.tucsoncitizen.com/index.php?page=opinion&story_id=040804b5_guestpipeline). (7) State interagency agreement.

Does the program (including program partners) achieve its annual performance goals?

Explanation: The program has achieved its annual performance goals to a large extent. Annual targets for the number of pipeline incidents caused by corrosion have been met and exceeded, and targets for the number of incidents caused by excavation damage have been narrowly missed. OPS is in the process of collecting and analyzing baseline data to develop annual efficiency measures, including a measure of the time required to issue a Corrective Action Order after a safety sensitive incident and a measure of unrecovered oil spill costs per costs for implementing the IMP in HCAs.

Evidence: (1) Accident Summary Statistics (http://ops.dot.gov/stats.htm). (2) FY 2005 RSPA budget justification pages 63-66.

Does the program demonstrate improved efficiencies or cost effectiveness in achieving program goals each year?

Explanation: The OPS program has demonstrated improved efficiency and cost effectiveness by using a risk-based approach to achieve the greatest possible safety and environmental benefits. The risk-based program focuses its effort on high consequence areas (HCAs), which maximizes available resources. OPS is developing a new web-based knowledge management tool called the Safety Monitoring and Reporting Tool (SMART) that will enable better management decisions and achieve efficiencies by integrating geospatial data in the National Pipeline Mapping System with pipeline incident, compliance, system information and other pipeline safety information. RSPA/OPS has submitted a competitive sourcing plan in accordance with OMB revised Circular A-76. For improved efficiency, OPS is undertaking a comprehensive workforce planning effort. In addition, OPS is developing baseline data for efficiency measures that will assess program efficiency gains.

Evidence: (1) Exhibit 300 documents SMART, which is a business modernization of current steady-state systems that furthers E-Gov and supports CPIC planning process by creating an easy-to-find single point of access to pipeline information and OPS services for individuals. This will reduce the reporting burden on businesses by ensuring that OPS appropriately integrates data collection to meet needs, fully implement electronic data collection where possible via the Internet, and share information with State and other Federal agencies. (2) Concept of Operations document (how enforcement would link to PIPES, etc.). (3) SOW for Enforcement Tracking System. (4) DOT Performance Plan (www.dot.gov/PerfPlan2004/index.html). (5) For A-76 competition, OPS participates in agency-wide initiative that follows OMB Circular and DOT's competitive sourcing policy in implementing the plan (www.rspa.dot.gov/competitive.html). (6) SOW for Workforce Planning Initiative.

Does the performance of this program compare favorably to other programs, including government, private, etc., with similar purpose and goals?

Explanation: GAO has stated that pipelines are inherently safer to the public than other modes of freight transportation, indicating that the program compares favorably to similar programs. DOT's Performance Plan reviews individual modal organizations' performance and contribution towards the Department's overall strategic goals. Additionally, OPS internally (through Oakridge National Laboratory) reviewed inspection and compliance programs of other federal agencies (FHWA, FRA, FAA, USCG, EPA, NRC, and OSHA) and the review indicated that the program performs comparably to other compliance programs. OPS also conducted an internal review of the study entitled 'The U.S. Pipeline Industry's Safety Performance." The review compares the environmental and safety records for pipelines to the record for other modes - trucks, tankers and barges, and railroads - of oil transportation, and the records for pipelines exceed the other modes.

Evidence: (1) GAO Report GAO-04-801, "Management of the Office of Pipeline Safety's Enforcement Program Needs Further Strengthening," July 2004 (www.gao.gov/new.items/d04801.pdf). (2) Pipeline Security: Industry and Federal Efforts and Associated Legislation, CRS RL31391, April 2002 (www.ncseonline.org/NLE/CRS/NLE/CRSreports/RL31391.pdf). (3) "Compliance, Inspection, and Pipeline Inspection Priority Program Review by Oak Ridge National Laboratory, Chapter 5, 1997. (4) Review of the Report "The U.S. Oil Pipeline Industry's Safety Performance" 2003 by Volpe Center. (5) Op-Ed Letter from NTSB ex-chairman, Jim Hall (www.tucsoncitizen.com/index.php?page=opinion&story_id=040804b5_guestpipeline).

Do independent evaluations of sufficient scope and quality indicate that the program is effective and achieving results?

Explanation: PSIA 2002 requires the DOT Inspector General and the GAO to periodically report to Congress on OPS' progress in implementing the requirements of the legislation. Recent IG, GAO, and NTSB reports and testimonies have indicated that the program is improving its effectiveness and achieving better results than in the past. However, these reports and testimonies have indicated that the program needs to continue working to improve its performance. Specifically, an NTSB official testified that OPS has significantly improved its safety record but advised OPS to continue working on projects to reduce excavation damage, a leading cause of pipeline accidents. The DOT IG recognized improved overall performance but noted that gas transmission pipelines are not meeting the program's strategic safety goal. GAO reported that the program is enhancing its enforcement but lacks effective management to ensure that civil penalties are collected.

Evidence: (1) DOT IG Report No. SC-2004-064, "Actions Taken and Needed for Improving Pipeline Safety," (www.oig.dot.gov/item_details.php?item=1344). (2) GAO Report GAO-04-801, "Management of the Office of Pipeline Safety's Enforcement Program Needs Further Strengthening," July 2004 (www.gao.gov/new.items/d04801.pdf). (3) June 2004 testimony by NTSB, GAO, and IG officials (www.house.gov/transportation). (4) Pipeline Safety: Systematic Process Needed to Evaluate Outcomes of Research and Development Program, GAO-03-746 June 30, 2003; (www.gao.gov/new.items/d03746.pdf).

Were programmatic goals (and benefits) achieved at the least incremental societal cost and did the program maximize net benefits?

Explanation: The program has maximized net benefits through implementation of is regulatory actions, as indicated in the Regulatory Impact Analyses conducted for significant rules. Since 1999, OPS has followed the guidelines in 'A Collaborative Framework for OPS's Cost-Benefit Analysis,' developed by a joint OPS stakeholder workgroup to achieve economic efficiency for all OPS regulations. The Integrity Management Program (IMP) is an example where repeated consultation with industry and stakeholders groups, along with the Technical Advisory Committees, resulted in a more cost effective and performance based rulemaking than the initial proposal.

Evidence: (1) A Collaborative Framework for OPS's Cost-Benefit Analysis (http://ops.dot.gov/document/cba_rpt.pdf). (2) INGAA letter to OMB stating benefits exceeding costs of IMP rule. (3) RIAs for gas and liquid IMP show costs and benefits of rules.