BASIS, PURPOSE, AND STATUTORY AUTHORITY.

This part prescribes requirements for the reporting of incidents, safety-related conditions, and annual pipeline summary data by operators of gas pipeline systems located in the State of Colorado to the United States Department of Transportation and the Safety and Enforcement Section of the Commission. This part does not apply to— (a) Gathering of gas outside of the following areas:

(i) The limits of any incorporated or unincorporated city, town, or village. (ii) Any designated residential or commercial area such as a subdivision, business or shopping center, or community development.

These rules are adopted by the Commission, acting as agent for the United States Department of Transportation by virtue of the annual submission for certification under 49 U.S.C. § 60105. Under these rules, the State of Colorado enforces the provisions of 49 U.S.C. §§ 60101, et seq., with respect to the intrastate pipeline transportation of gas over which it has jurisdiction under state law. The Commission has authority under § 40-2-115, C.R.S. to enter into cooperative agreements with any agency of the United States and to adopt rules to administer and enforce 49 U.S.C. §§ 60101, et seq. The Commission has authority under § 40-2-108, C.R.S. to adopt rules as are necessary for the proper administration and enforcement of Title 40, C.R.S.

(4 CCR 723-11) PART I. RULES GOVERNING THE FILING OF REPORTS RELATING TO GAS PIPELINE SAFETY (REFERENCE 49 CFR 191)

RULE (4 CCR) 723-11-1. DEFINITIONS.

As used in these rules and in the RSPA (Research and Special Programs Administration) Forms referenced in these rules— 723-11-1.1 “Commission” means the Public Utilities Commission of the State of Colorado. 723-11-1.2 “Direct Sales Pipeline” means a pipeline from an interstate or intrastate gas pipeline to a direct sales meter or to the connection with a direct sales customer's piping, whichever is farther downstream. A direct sales meter is the meter that measures the transfer of gas to a direct sales consumer purchasing gas for its consumption.

723-11-1.3 “Gas” means natural gas, flammable gas, gas which is toxic or corrosive, and petroleum gas as defined in § 192.11(c), 49 C.F.R.

723-11-1.4 “Gathering pipeline” means a pipeline that transports gas from a current production facility to a transmission pipeline or main.

723-11-1.5 “Incident” means any of the following:

723-11-1.5.1 An event that involves a release of gas from a jurisdictional pipeline which results in- (a) Death, or personal injury necessitating inpatient hospitalization; or (b) Estimated property damage, including the cost of gas lost to the operator or others, or both, of $50,000 or more.

723-11-1.5.2 An event that is significant, in the judgment of the operator, even though it did not meet the criteria of Rule 1.5.1.

723-11-1.6 “Major construction” means the construction of any new pipeline which is originally estimated to cost $100,000 or more. Cost includes only the direct costs associated with the construction. 723-11-1.7 “Major repair” means any repair, replacement, renewal or upgrade to a pipeline which is originally estimated to cost $50,000 or more. Cost includes only the direct costs associated with the repair.

723-11-1.8 “Master Meter System” means a pipeline system for distributing gas within, but not limited to, a definable area, such as a mobile home park, housing project, or apartment complex, where the operator of the mobile home park, housing project or apartment complex purchases metered gas from an outside source for delivery through a gas distribution pipeline system. The gas distribution pipeline system supplies the ultimate consumer. 723-11-1.9 “Municipality” means a city or town in the State of Colorado. 723-11-1.10 “Operator” means a person who engages in the transportation of gas. 723-11-1.11 “Person” means any individual, firm, joint venture, partnership, corporation, association, state, municipality, cooperative association, or joint stock association, and includes any trustee, receiver, assignee, or personal representative thereof. 723-11-1.12 “Pipeline” or “Pipeline System” means all parts of those physical facilities which have been constructed and through which gas moves, can, or will move in transportation, including, but not limited to, pipes, valves, and other appurtenances attached to pipes, compressor units, metering stations, regulator stations, delivery stations, holders, and fabricated assemblies. 723-11-1.13 “SMYS” means specified minimum yield strength. 723-11-1.13.1 For steel pipe manufactured in accordance with a listed specification, SMYS is the yield strength specified as a minimum in that specification; or 723-11-1.13.2 For steel pipe manufactured in accordance with an unknown or unlisted specification, the yield strength determined in accordance with 49 C.F.R. § 192.107(b). 723-11-1.14 “State” means the State of Colorado.

723-11-1.15 “Transmission pipeline” means a pipeline other than a gathering pipeline, that: 723-11-1.15.1 Transports gas from a gathering pipeline or storage facility to a distribution center or storage facility;

723-11-1.15.2 Operates at a hoop stress of 20 percent or more of SMYS; or 723-11-1.15.3 Transports gas within a storage field; or, 723-11-1.15.4 A pipeline serving a large volume customer receiving similar volumes of gas as a distribution center, and includes factories, power plants, and institutional users of gas. 723-11-1.16 “Transportation of gas” means the gathering, transmission, or distribution of gas by pipeline, or the storage of gas in or affecting intrastate commerce. RULE (4 CCR) 723-11-2. TELEPHONIC NOTICE OF CERTAIN INCIDENT. 723-11-2.1 At the earliest practicable moment following discovery, but generally not to exceed two hours after discovery, each operator shall give telephonic notice in accordance with Rule 2.2 of each incident as defined in Rule 1.5. In addition, if a natural gas leak occurs on jurisdictional piping resulting in the evacuation of 50 or more people from a normally occupied public building, master meter system, or resulting in the closure of a public street or highway, the operator shall give a telephonic notice to the Safety and Enforcement Section of the Commission. 723-11-2.2 Each notice required by Rule 1.5 shall be made by telephone to the United States Department of Transportation, National Response Center (NRC) and to the Safety and Enforcement Section of the Commission, , and shall include the following information: 723-11-2.2.1 The names of operator and person making the report and their telephone numbers; 723-11-2.2.2 The location of the incident;

723-11-2.2.3 The time of the incident;

723-11-2.2.4 The number of fatalities and personal injuries, if any; 723-11-2.2.5 All other significant facts that are known by the operator which may be relevant to the cause of the incident or extent of the damages; and 723-11-2.2.6 The National Response Center control number when applicable. RULE (4 CCR) 723-11-3. ADDRESSEES FOR WRITTEN REPORTS.

723-11-3.1 Each written report required by these rules, except for Notices of Major Construction or Major Repair and reports of third party damage statistics as defined under Rule 41, shall be made to the Information Resources Manager, Office of Pipeline Safety, Research and Special Programs Administration, U.S. Department of Transportation.

723-11-3.2 A copy of each written report required by Rule 3.1 mailed to the Information Resources Manager shall be filed with the Safety and Enforcement Section, Public Utilities Commission of the State of Colorado.

RULE (4 CCR) 723-11-4. DISTRIBUTION SYSTEM: INCIDENT REPORT. 723-11-4.1 Except as provided in Rule 4.3, each operator of a distribution pipeline system shall file Department of Transportation Form RSPA F 7100.1 with the agencies as set forth in Rule 3 as soon as practicable, but not more than 30 days, after discovery of an incident required to be reported under Rule 2.

723-11-4.2 When additional relevant information is obtained after the report is filed under Rule 4.1, the operator shall file a supplementary report as soon as practicable with a clear reference by date and subject to the original report.

723-11-4.3 The incident report required by this rule need not be submitted with respect to master meter systems or liquefied natural gas facilities.

RULE (4 CCR) 723-11-5. DISTRIBUTION SYSTEM: ANNUAL REPORT. 723-11-5.1 Except as provided in Rule 5.2, each operator of a distribution pipeline system shall file an annual report for jurisdictional piping located in Colorado on Department of Transportation Form RSPA F 7100.1-1 with the agencies set forth in Rule 3. This report must be filed each year, not later than March 15, for the preceding calendar year.

723-11-5.2 The annual report required by this rule need not be submitted with respect to petroleum gas systems which serve fewer than 100 customers from a single source. RULE (4 CCR) 723-11-6. DISTRIBUTION SYSTEMS REPORTING TRANSMISSION PIPELINES; TRANSMISSION OR GATHERING SYSTEMS REPORTING DISTRIBUTION PIPELINES. Each operator, primarily engaged in gas distribution, who also operates gas transmission or gathering pipelines shall file separate reports for these pipelines as required by Rules 7 and 8. Each operator, primarily engaged in gas transmission or gathering, who also operates gas distribution pipelines shall file separate reports for these pipelines as required by Rules 4 and 5. RULE (4 CCR) 723-11-7. TRANSMISSION AND GATHERING SYSTEMS: INCIDENT REPORT. 723-11-7.1 Each operator of a transmission or a gathering pipeline system shall file Department of Transportation Form RSPA F 7100.2 with the agencies set forth in Rule 3 as soon as practicable, but not more than 30 days, after discovery of an incident required to be reported under Rule 2. 723-11-7.2 When additional relevant information is obtained after the report is filed under Rule 7.1, the operator shall file a supplemental report as soon as practicable with a clear reference by date and subject to the original report.

RULE (4 CCR) 723-11-8. TRANSMISSION AND GATHERING SYSTEMS: ANNUAL REPORT. Each operator of a transmission or a gathering pipeline system shall file an annual report for jurisdictional piping located in Colorado on Department of Transportation Form RSPA 7100.2-1 with the agencies set forth in Rule 3. This report shall be filed each year, not later than March 15, for the preceding calendar year.

RULE (4 CCR) 723-11-9. REPORT FORMS.

Copies of the prescribed report forms are available without charge upon request from the agencies set forth in Rule 3. Additional copies in this prescribed format may be reproduced and used if on the same size and kind of paper.

RULE (4 CCR) 723-11-10. REPORTING SAFETY-RELATED CONDITIONS. 723-11-10.1 Except as provided in Rule 10.2, each operator shall report in accordance with Rule 11 and to the extent known the existence of any of the following safety-related conditions involving facilities in service:

723-11-10.1.1 In the case of a pipeline that operates at a hoop stress of 20 percent or more of its specified minimum yield strength, general corrosion that has reduced the wall thickness to less than that required for the maximum allowable operating pressure, and localized corrosion pitting to a degree where leakage might result. 723-11-10.1.2 Unintended movement or abnormal loading by environmental causes, such as an earthquake, landslide, or flood, that impairs the serviceability of a pipeline. 723-11-10.1.3 Any material defect or physical damage that impairs the serviceability of a pipeline that operates at a hoop stress of 20 percent or more of its specified minimum yield strength.

723-11-10.1.4 Any malfunction or operating error that causes the pressure of a pipeline that contains gas to rise above its maximum allowable operating pressure, plus the build-up allowed for operation of pressure limiting or control devices. 723-11-10.1.5 A leak in a pipeline that contains gas that constitutes an emergency. 723-11-10.1.6 Any safety-related condition that could lead to an imminent hazard and causes (either directly or indirectly by remedial action of the operator), for purposes other than abandonment, a 20 percent or more reduction in operating pressure or shutdown of operation of a pipeline.

723-11-10.2 A report is not required for any safety-related condition that— 723-11-10.2.1 Exists on a master meter system or a customer-owned service line; 723-11-10.2.2 Is an incident or results in an incident before the deadline for filing the safety- related condition report;

723-11-10.2.3 Exists on a pipeline (other than a liquefied natural gas facility) that is more than 220 yards from any building intended for human occupancy or outdoor place of assembly, except that reports are required for conditions within the right-of-way of an active railroad, paved road, street, or highway; or 723-11-10.2.4 Is corrected by repair or replacement in accordance with applicable safety standards before the deadline as set forth in Rule 11 for filing the safety-related condition report, except that reports are required for conditions under Rule 10.1.1 other than localized corrosion pitting on an effectively coated and cathodically protected pipeline. RULE (4 CCR) 723-11-11. FILING SAFETY-RELATED CONDITION REPORTS. 723-11-11.1 Each report of a safety-related condition under Rule 10.1 shall be filed with the agencies as set forth in Rule 3 in writing within 5 working days (not including Saturday, Sunday, or federal or state holidays) after the day a representative of the operator first determines that the condition exists, but not later than 10 working days after the day a representative of the operator discovers the condition. Separate conditions may be described in a single report if they are closely related. Reports may be filed with the United States Department of Transportation and the Safety and Enforcement Section of the Commission by telefacsimile. 723-11-11.2 The report shall be headed “Safety-Related Condition Report” and provide the following information:

723-11-11.2.1 Name and principal address of operator;

723-11-11.2.2 Date of report;

723-11-11.2.3 Name, job title, and business telephone number of person submitting the report; 723-11-11.2.4 Name, job title, and business telephone number of person who determined that the condition exists;

723-11-11.2.5 Date condition was discovered and date condition was first determined to exist; 723-11-11.2.6 Location of condition, with reference to the town, city, or county; and as appropriate, nearest street address, survey station number, milepost, landmark, or name of pipeline;

723-11-11.2.7 Description of the condition, including circumstances leading to its discovery, any significant effects of the condition on safety, and the type of gas transported or stored; and 723-11-11.2.8 The corrective action taken (including reduction of pressure or shutdown) before the report is submitted and the planned follow-up future corrective action, including the anticipated schedule for starting and concluding such action. RULE (4 CCR) 723-11-12. FILING NOTICES OF MAJOR CONSTRUCTION OR MAJOR REPAIR. 723-11-12.1 Each notice of major construction or major repair shall be filed with the Safety and Enforcement Section of the Commission in writing not later than 20 working days before the scheduled or anticipated date of commencement of construction, if practicable. The notice shall contain a description of the anticipated type and location of construction, the estimated cost and date of commencement, and the estimated construction or repair period. RULE (4 CCR) 723-11-13. RULE 7 OF THE GAS UTILITIES RULES. 723-11-13.1 Accidents within the meaning of Rule 7 of the Gas Utilities Rules, 4 CCR 723-4, are included within incidents as defined in Rule 6.

723-11-13.2 The reports required to be filed by Rules 4 and 7 fulfill the reporting requirements of Rule 7 of the Gas Utilities Rules, 4 CCR 723-4.

(4 CCR 723-11) PART II. RULES GOVERNING THE ENFORCEMENT OF GAS PIPELINE SAFETY (REFERENCE 49 CFR 190)

BASIS, PURPOSE, AND STATUTORY AUTHORITY.

These rules prescribe enforcement procedures utilized by the Pipeline Safety Group, Safety and Enforcement Section of the Colorado Public Utilities Commission (“Commission”), acting as agent for the United States Department of Transportation by virtue of the annual submission for certification under 49 U.S.C. § 60105. Under this agreement, the State of Colorado enforces the provisions of 49 U.S.C. §§ 60101, et seq., with respect to the intrastate pipeline transportation of gas over which it has jurisdiction under state law. Gas facilities include gas gathering, distribution, transmission, master meter and direct sales systems. The Commission has authority under § 40-2-115, C.R.S. to enter into cooperative agreements with any agency of the United States government and to adopt rules to administer and enforce the safety laws and regulations of the United States under 49 U.S.C. §§ 60101, et seq. The Commission has authority under § 40-2-108, C.R.S. to adopt rules and regulations as are necessary for the proper administration and enforcement of Title 40, C.R.S. RULE (4 CCR) 723-11-14. DEFINITIONS.

As used in this part:

723-11-14-1. “Chief” means the head of the Safety and Enforcement Section of the Public Utilities Commission of the State of Colorado.

723-11-14-2. “Commission” means the Public Utilities Commission of the State of Colorado. 723-11-14-3. “Direct Sales Pipeline” means a pipeline from an interstate or intrastate gas pipeline to a direct sales meter or the connection to a direct sales customer's piping, whichever is farther downstream. A direct sales meter is the meter that measures the transfer of gas to a direct sales consumer purchasing gas for its own consumption.

723-11-14-4 “Director” means the Director of the Commission. 723-11-14.5 “Hazardous Facility” means a pipeline facility that if allowed to remain operating could be hazardous to life or property.

723-11-14.6 “Hearing” means any hearing provided in Rule 21 of these rules. 723-11-14.7 “Intrastate pipeline transportation” means pipeline transportation of gas within the State of Colorado which is not subject to the jurisdiction of the Federal Energy Regulatory Commission under the Natural Gas Act.

723-11-14.8 “OPS” means the Office of Pipeline Safety, which is part of the Research and Special Programs Administration, of the United States Department of Transportation. 723-11-14.9 “Person” means any individual, firm, joint venture, partnership, corporation, association, municipality, cooperative association, or joint stock association, and includes any trustee, receiver, assignee, or personal representative thereof. 723-11-14.10 “Presiding Officer” means the chairman or senior commissioner in a hearing conducted before the Commission en banc, or individual commissioner or administrative law judge in a hearing conducted by a single commissioner or administrative law judge. 723-11-14.11 “Respondent” means a person upon whom a compliance directive, notice of probable violation, consent stipulation, or order to show cause has been served. 723-11-14.12 “Staff” means the staff of the Gas Pipeline Safety Group, a unit of the Safety and Enforcement Section of the Public Utilities Commission of the State of Colorado. 723-11-14.13 “State” means the State of Colorado.

RULE (4 CCR) 723-11-15. SERVICE.

723-11-15.1 Each order, notice, or other document required to be served under these rules shall be served personally or by registered or certified mail.

723-11-15.2 Service upon a person's duly authorized representative or agent constitutes service upon that person.

723-11-15.3 Service by registered or certified mail is complete upon mailing. An official U.S. Postal Service receipt evidencing a registered or certified mailing constitutes prima facie evidence of service.

RULE (4 CCR) 723-11-16. SUBPOENAS.

723-11-16.1 The Commission, any commissioner, any administrative law judge, or the Director of the Commission, may issue a subpoena in accordance with the provisions of §40-6-103(1), C.R.S. 723-11-16.2 Subpoena practice before the Commission shall be governed by Rule 45 of the Colorado Rules of Civil Procedure(“CRCP”), except as provided in this rule and §40-6-102 and 103, C.R.S. When CRCP 45 is applied to Commission subpoena practice, the word “court” in CRCP 45 means the Commission, a commissioner, an administrative law judge, or the Director of the Commission.

723-11-16.3 Enforcement of any subpoena issued under this rule shall be in the district court, as provided in §40-6-103(2), C.R.S.

RULE (4 CCR) 723-11-17. INSPECTIONS.

723-11-17.1 Staff employees authorized by the Chief, upon presenting appropriate credentials are authorized to enter upon, inspect, and examine, at reasonable times and in a reasonable manner, the records and properties of persons subject to 49 U.S.C. §§ 60101, et seq., and these rules to the extent such records and properties are relevant to determining the compliance of such persons with 49 U.S.C. §§ 60101, et seq., or State law, rules, or orders issued thereunder. 723-11-17.2 Inspections are ordinarily conducted pursuant to one of the following: 723-11-17.2.1 Routine scheduling by the Staff;

723-11-17.2.2 A complaint received from a member of the public; 723-11-17.2.3 Information obtained from a previous inspection; 723-11-17.2.4 Pipeline accident or incident;

723-11-17.2.5 Whenever deemed appropriate by the Chief; or 723-11-17.2.6 At the request of the Western Region Director of the OPS. 723-11-17.3 If, after an inspection, the Staff believes that further information is needed to determine appropriate action, the Staff may send the owner or operator a Request for Specific Information to be answered within 45 days after receipt of the letter. 723-11-17.4 To the extent necessary to carry out the responsibilities of the Commission under 49 U.S.C. §§ 60101, et seq., and/or state rules , the Staff may require testing of portions of pipeline facilities subject to 49 U.S.C. §§ 60101, et seq., or state rules which have been involved in or affected by an accident. However, before exercising such authority, the Staff shall make every effort to negotiate a mutually acceptable plan with the owner of such facilities for performing such testing. 723-11-17.5 When the information obtained from an inspection or from other appropriate sources indicates that further action is warranted, the Chief may issue a Warning Letter under Rule 18, or may initiate one or more enforcement proceedings prescribed in these rules. RULE (4 CCR) 723-11-18. WARNING LETTERS.

Upon determining that a probable violation of 49 U.S.C. §§ 60101, et seq., or any State rule, or order issued thereunder has occurred, the Chief may issue a Warning Letter notifying the owner or operator of the probable violation and advising him to correct it or be subject to enforcement action under these rules. RULE (4 CCR) 723-11-19. NOTICE OF PROBABLE VIOLATION.

723-11-19.1 Except as otherwise provided by these rules, the Chief may commence an enforcement proceeding by serving a Notice of Probable Violation on a person subject to 49 U.S.C. §§ 60101, et seq., or State rules adopted by the Commission under 49 U.S.C. §§ 60101, et seq., charging him with a probable violation of 49 U.S.C. §§ 60101, et seq., or any State rule or order issued thereunder.

723-11-19.2 A Notice of Probable Violation issued under this rule shall include: 723-11-19.2.1 A statement of the provisions of the law, rules, or orders which the respondent is alleged to have violated and a statement of the facts upon which the allegations are based;

723-11-19.2.2 A Notice of Response Options available to the respondent under Rule 20; 723-11-19.2.3 If a civil penalty is proposed under Rule 23, the amount of the proposed civil penalty and the maximum civil penalty for which respondent may be liable under law; and 723-11-19.2.4 If a Compliance Directive is proposed under Rule 28, a statement of the remedial action being sought in the form of a proposed Compliance Directive. 723-11-19.3 The Chief may amend a Notice of Probable Violation not later than thirty (30) days prior to the commencement of a hearing under Rule 21. After this the Chief may amend such notice only with leave of the Presiding Officer.

RULE (4 CCR) 723-11-20. RESPONSE OPTIONS.

Within 30 days after his receipt of a Notice of Probable Violation the respondent shall respond to the Chief in one or more of the following ways:

723-11-20.1 When the Notice of Probable Violation contains a proposed civil penalty, 723-11-20.1.1 the respondent may pay the proposed civil penalty as provided in Rule 25 and the Staff will close the case with prejudice;

723-11-20.1.2 the respondent may submit an Offer in Compromise of the proposed civil penalty under Rules 20.3 and 25.3;

723-11-20.1.3 the respondent may submit written explanations, information or other materials in answer to the allegations or in mitigation of the proposed civil penalty; or 723-11-20.1.4 the respondent may request a hearing under Rule 21. 723-11-20.2 When the Notice of Probable Violation contains a proposed Compliance Directive, 723-11-20.2.1 the respondent may agree to the proposed Compliance Directive; 723-11-20.2.2 the respondent may request the execution of a Consent Stipulation under Rule 22; 723-11-20.2.3 the respondent may object to the proposed Compliance Directive and submit written explanations, information or other materials in answer to the allegations in the Notice of Probable Violation; or 723-11-20.2.4 the respondent may request a hearing under Rule 21. 723-11-20.3 An Offer in Compromise under Rule 20.1.2 shall be made by the respondent submitting a check or money order for the amount offered. If the Offer in Compromise is accepted by the Chief, the respondent will be notified in writing that the acceptance is in full settlement of the proposed civil penalty. If an Offer in Compromise submitted under Rule 20.1.2 is rejected by the Chief, the check or money order shall be returned to the respondent with written notification. Within 10 days after his receipt of such notification, the respondent shall again respond to the Chief in one or more of the ways provided in Rule 20.1. 723-11-20.4 If the respondent fails to respond in accordance with this rule, the Notice of Probable Violation shall be set for hearing at a time and place convenient to the Commission. RULE (4 CCR) 723-11-21. HEARING AND ORDER.

723-11-21.1 A request for a hearing in response to a Notice of Probable Violation issued under Rule 19 shall be accompanied by a statement of the issues which the respondent intends to raise at the hearing. The issues may relate to the alleged violations, new information or to the proposed compliance directive or proposed civil penalty amount. A respondent's failure to specify an issue may result in waiver of his right to raise that issue at the hearing. 723-11-21.2 The hearing shall be held and an order issued in accordance with the Rules of Practice and Procedure of the Commission, 4 CCR 723-1, and Article 6 of Title 40, C.R.S. 723-11-21.3 If a civil penalty is assessed as part of the order, the order shall include the amount of the penalty and the procedures for payment of the penalty, provided that the amount of the assessed civil penalty may not exceed the amount of the penalty proposed in the Notice of Probable Violation; and 723-11-21.4 If a Compliance Directive is issued as part of the order, the order shall include a statement of the actions required to be taken by the respondent and the time by which such actions must be accomplished.

RULE (4 CCR) 723-11-22. CONSENT STIPULATIONS.

723-11-22.1 At any time before the issuance of a recommended or initial decision pursuant to § 40-6- 109,C.R.S., under Rule 21, the Chief and the respondent may agree to dispose of the case by joint execution of a Consent Stipulation.

723-11-22.2 A Consent Stipulation executed under Rule 22.1 shall include: 723-11-22.2.1 An admission by the respondent of all jurisdictional facts; 723-11-22.2.2 An express waiver by the respondent of further procedural steps, including his right to a hearing under Rule 21, his right to seek judicial review or otherwise challenge or contest the validity of the Consent Stipulation;

723-11-22.2.3 An acknowledgement by the respondent that the Notice of Probable Violation may be used to construe the terms of the Consent Stipulation; and 723-11-22.2.4 A statement of the actions required of the respondent and the time by which such actions shall be accomplished.

RULE (4 CCR) 723-11-23. CIVIL PENALTIES.

723-11-23.1 As provided in § 40-7-117, C.R.S., any person who is determined to have violated a provision of 49 U.S.C. §§ 60101, et seq., or any State rule, or order issued thereunder shall be subject to a civil penalty not to exceed $10,000 per violation; except that, in the case of a group or series of related violations, the aggregate amount of such penalties shall not exceed $500,000. Each day of a continuing violation shall constitute a separate violation. 723-11-23.2 No person shall be subject to a second or additional civil penalty for the violation of any provision of 49 U.S.C. §§ 60101, et seq., or any State rule adopted thereunder, or any order issued pursuant to Rules 21, 22, 23, or 27, if the violations are based on the same act. RULE (4 CCR) 723-11-24. CIVIL PENALTY CONSIDERATIONS.

The presiding officer may impose a civil penalty under these rules only after considering: 723-11-24.1 The nature, circumstances and gravity of the violation; 723-11-24.2 The degree of the respondent's culpability; 723-11-24.3 The respondent's history of prior offenses; 723-11-24.4 The respondent's ability to pay;

723-11-24.5 Any good faith efforts by the respondent in attempting to achieve compliance and to prevent future similar violations;

723-11-24.6 The effect on the respondent's ability to continue in business; 723-11-24.7 The size of the business of the violator.

723-11-24.8 Such other matters as equity and fairness may require. RULE (4 CCR) 723-11-25. PAYMENT OF PENALTY.

723-11-25.1 Payment of a civil penalty under these rules shall be by check or money order payable to the “Public Utilities Commission of the State of Colorado”. 723-11-25.2 If a respondent fails to pay the full amount of a civil penalty assessed under these rules within 45 days after service of an administratively final decision, the Commission may refer the case to the Attorney General's Office with a request that an action be commenced in court to collect the civil penalty.

723-11-25.3 If a respondent elects to make an Offer in Compromise of a civil penalty proposed in a Notice of Probable Violation issued under Rule 19, he shall do so in accordance with the procedures set forth in Rules 20.1.2 and 20.3.

RULE (4 CCR) 723-11-26. CORRECTIVE ACTION ORDERS.

723-11-26.1 Except as provided in Rule 26.2, if the Commission finds, after reasonable notice and opportunity for hearing in accordance with Rule 26.3, a particular pipeline facility to be hazardous to life or property, it shall issue a corrective action order pursuant to this rule requiring the owner or operator of the facility to take corrective action. Corrective action may include suspending or restricting the use of the facility, physical inspection, testing, repair, replacement, or other action, as may be appropriate.

723-11-26.2 The Commission may waive the requirement for notice and hearing under Rule 26.1 before issuing a corrective action order pursuant to this rule when it determines that notice and hearing may result in delay and the likelihood of serious harm to life or property. However, the Commission shall include with the corrective action order a notice informing the owner or operator of his right to a hearing upon request as soon as practicable after issuance of the corrective action order. The provisions of Rule 26.3.2 shall apply to an owner's or operator's request for a hearing. The purpose of such a post-order hearing is for the Commission to determine whether the corrective action order should remain in effect or be amended, rescinded or suspended in accord with Rule 26.7.

723-11-26.3 NOTICE AND HEARING:

723-11-26.3.1 An order to show cause and notice of hearing under this rule shall be served in accordance with Rule 15 upon the owner or operator of an alleged hazardous facility. The order to show cause shall allege the existence of a hazardous facility, stating the facts and circumstances supporting the issuance of a corrective action order, and providing the owner or operator an opportunity for a hearing, identifying the date, time and location of the hearing.

723-11-26.3.2 A hearing under this rule shall be conducted in accordance with the Rules of Practice and Procedure of the Commission, 4 CCR 723-1, and Article 6 of Title 40, C.R.S. 723-11-26.3.3 If the facility is found to be hazardous to life or property, a corrective action order shall be issued in accordance with this rule. If the facility is not found to be hazardous to life or property, the order to show cause shall be discharged. 723-11-26.4 A pipeline facility may be found to be hazardous to life or property under Rule 26.1: 723-11-26.4.1 If the evidence demonstrates that the particular facility is hazardous to life or property; or 723-11-26.4.2 If the pipeline facility or a component thereof has been constructed or operated with any equipment, material, or technique which is determined to be hazardous to life or property.

723-11-26.5 In making a determination under Rule 26.4, the following shall be considered, if relevant: 723-11-26.5.1 The characteristics of the pipe and other equipment used in the pipeline facility involved, including its age, manufacturer, physical properties (including its resistance to corrosion and deterioration), and the method of its manufacture, construction or assembly;

723-11-26.5.2 The nature of the materials transported by such facility (including their corrosive and deteriorative qualities), the sequence in which such materials are transported, and the pressure required for such transportation;

723-11-26.5.3 The aspects of the areas in which the pipeline facility is located, in particular the climatic and geologic conditions (including soil characteristics) associated with such areas, and the population density and population and growth patterns of such areas; 723-11-26.5.4 Any recommendation of the National Transportation Safety Board issued in connection with any investigation conducted by the Board; and 723-11-26.5.5 Such other factors as may be considered appropriate. 723-11-26.6 A decision finding a facility to be hazardous shall contain the following: 723-11-26.6.1 A finding that the pipeline facility is hazardous to life or property. 723-11-26.6.2 The relevant facts which form the basis for that finding. 723-11-26.6.3 The legal basis for the decision and corrective action order. 723-11-26.6.4 The nature and description of particular corrective action required of the respondent.

723-11-26.6.5 The date by which the required action must be taken, or completed and, where appropriate, the duration of the corrective action order. 723-11-26.7 The Commission shall rescind or suspend a corrective action order whenever it is shown to the Commission's satisfaction that the facility is no longer hazardous to life or property. When appropriate, however, such a recision or suspension may be accompanied by a Notice of Probable Violation issued under Rule 19.

723-11-26.8 At any time after a corrective action order issued under these rules has become effective, the Commission may request the Attorney General to bring an action in court to enforce the corrective action order as provided in Article 7 of Title 40, C.R.S. RULE (4 CCR) 723-11-27. INJUNCTIVE ACTION.

Whenever it appears to the Commission that a person has engaged, is engaging in, or is about to engage in any act or practice constituting a violation of any provision of Title 49 U.S.C., Chapter 601,, State rules, or orders issued thereunder, the Commission may request the Attorney General to bring an action in the appropriate district court for such relief as is necessary or appropriate, including mandatory or prohibitive injunctive relief, interim equitable relief, and monetary penalties as provided in Article 7 of Title 40, C.R.S. RULE (4 CCR) 723-11-28. COMPLIANCE DIRECTIVES.

When the Chief has reason to believe that a person is engaging in conduct which involves a violation of the 49 U.S.C. §§ 60101 et seq., or any State rule adopted or order issued thereunder, and if the nature of the violation and the public interest warrant, the Chief may conduct an investigation and inspection under Rule 17 to determine the nature and extent of the violation and may issue a Notice of Probable Violation under Rule 19 containing a Compliance Directive directing remedial action to be taken by the respondent. (4 CCR 723-11) PART III. RULES GOVERNING SAFETY STANDARDS FOR LIQUEFIED NATURAL GAS FACILITIES (REFERENCE 49 CFR 193)

BASIS, PURPOSE, AND STATUTORY AUTHORITY.

These rules prescribe safety standards for liquefied natural gas (LNG) facilities utilized by the Pipeline Safety Group, Safety and Enforcement Section of the Colorado Public Utilities Commission (“Commission”). The gas facilities are used in the transportation of gas by pipeline that is subject to 49 U.S.C. §§60101 et seq. and 49 C.F.R. Part 192, Transportation of Natural and other Gas by Pipeline: Minimum Federal Safety Standards (liquefied natural gas facilities). The Commission has authority under § 40-2-115, C.R.S., to enter into cooperative agreements with any agency of the United States government and to adopt rules and regulations to administer and enforce the safety laws and regulations of the United States under 49 U.S.C. §§ 60101, et seq. The Commission has authority under § 40-2-108, C.R.S., to adopt rules and regulations as are necessary for the proper administration and enforcement of Title 40, C.R.S.

RULE (4 CCR) 723-11-29. STANDARDS FOR LIQUIFIED NATURAL GAS FACILITIES. The Commission adopts herein the federal safety standards for liquefied natural gas facilities used in the transportation of gas by pipeline, that are subject to 49 U.S.C. §§ 60101, et seq., which standards are adopted in the Code of Federal Regulations, Part 193, Title 49(October 1, 2002). This Rule does not include later amendments to, or editions of, 49 C.F.R. Part 193, after October 1, 2002. The title and address of the person employed by the Colorado Public Utilities Commission from whom information regarding how the incorporated material may be obtained or examined is: Chief, Gas Pipeline Safety Section Colorado Public Utilities Commission 1580 Logan Street, OL-2 Denver, CO 80203 RULE (4 CCR) 723-11-30. HOW MATERIAL INCORPORATED BY REFERENCE MAY BE OBTAINED. The incorporated material may be examined at the offices of the Commission, 1580 Logan Street, OL-2, Denver, Colorado 80203 between the hours of 8:00 a.m. and 5:00 p.m., Mondays through Fridays, except when such days are State holidays. The incorporated material also may be examined at any state publications depository library.

RULE (4 CCR) 723-11-31. CONFLICT.

In the event of a conflict between the provisions of 49 C.F.R. Part 193, and 4 CCR 723-11 regarding the administrative, enforcement, and reporting requirements, the latter shall apply. RULE (4 CCR) 723-11-32. WAIVER.

Waivers of these rules may be granted by the Commission in accordance with 49 U.S.C. § 60118 and 49 C.F.R. Part 193.

(4 CCR 723-11) PART IV. STANDARDS FOR TRANSPORTATION OF NATURAL AND OTHER GAS BY PIPELINE (REFERENCE 49 CFR 192)

BASIS, PURPOSE AND STATUTORY AUTHORITY.

The basis and purpose of these rules is to adopt by reference the minimum safety standards for pipeline transportation and for pipeline facilities of the United States Department of Transportation that are authorized by 49 U.S.C. §§ 60101 et seq. and that are set forth in Part 192, 49 C.F.R.— Transportation of Natural and other Gas by Pipeline (October 1, 2002). The Commission has authority under § 40-2- 115(1.5), C.R.S., to adopt such rules as may be necessary to enforce and administer gas pipeline safety in cooperation with the United States Department of Transportation. The Commission has general authority under § 40-2-108, C.R.S., to promulgate such rules as are necessary for the proper administration and enforcement of Title 40, C.R.S.

RULE (4 CCR) 723-11-33. MINIMUM SAFETY STANDARDS.

The Commission hereby adopts by reference the minimum safety standards of the United States Department of Transportation that are set forth in 49 C.F.R. Part 192 (October 1, 2002). This Rule does not include later amendments to, or editions of, 49 C.F.R. Part 192, after October 1, 2002. RULE 4 (CCR) 723-11-34. HOW MATERIAL INCORPORATED BY REFERENCE MAY BE OBTAINED. 723-11-34.1 The title and address of the person employed by the Colorado Public Utilities Commission from whom information concerning how the material incorporated by reference may be obtained or examined is:

Chief, Gas Pipeline Safety Section Colorado Public Utilities Commission 1580 Logan Street, OL-2 Denver, Colorado 80203 723-11-34.2 The material incorporated by reference may be examined at the offices of the Commission, 1580 Logan Street, OL-2, Denver, Colorado 80203, between the hours of 8:00 a.m. and 5:00 p.m., Mondays through Fridays, except when such days are state holidays. 723-11-34.3 The material incorporated by reference may be examined also at any state publications depository library.

RULE 4 (CCR) 723-11-35. CONFLICT.

In the event of a conflict between the provisions of 49 C.F.R. Part 192 and this rule, this rule shall govern. RULE 4 (CCR) 723-11-36. WAIVER.

Waivers of this rule may be granted by the Commission in accordance with 49 U.S.C. § 60118 and 49 C.F.R. Part 192.

(4 CCR 723-11) PART V. RULES GOVERNING DRUG AND ALCOHOL TESTING (REFERENCE 49 CFR 40 & 199)

BASIS, PURPOSE AND STATUTORY AUTHORITY.

The basis and purpose of these rules is to adopt by reference the drug and alcohol testing program of the United States Department of Transportation that is set forth in 49 C.F.R Parts 40 and 199 (October 1, 2002). The Commission has authority under § 40-2-115(1.5), C.R.S., to adopt such rules as may be necessary to enforce and administer gas pipeline safety in cooperation with the United States Department of Transportation. The Commission has general authority under § 40-2-108, C.R.S., to promulgate such rules as are necessary for the proper administration and enforcement of Title 40, C.R.S. RULE 4 (CCR) 723-11-37. DRUG AND ALCOHOL TESTING.

The Commission hereby adopts by reference the drug and alcohol testing program of the United States Department of Transportation set forth in 49 C.F.R. Parts 40 and 199 (October 1, 2002). This Rule does not include later amendments to, or editions of, 49 C.F.R. Parts 40 and 199, after October 1, 2002. RULE 4 (CCR) 723-11-38. HOW MATERIAL INCORPORATED BY REFERENCE MAY BE OBTAINED. 723-11-38.1 The title and address of the person employed by the Colorado Public Utilities Commission from whom information concerning how the material incorporated by reference may be obtained or examined is:

Chief, Gas Pipeline Safety Section Colorado Public Utilities Commission 1580 Logan Street, OL-2 Denver, Colorado 80203 723-11-38.2 The material incorporated by reference may be examined at the offices of the Commission, 1580 Logan Street, OL-2, Denver, Colorado 80203, between the hours of 8:00 a.m. and 5:00 p.m., Mondays through Fridays, except when such days are state holidays. 723-11-38.3 The material incorporated by reference may be examined also at any state publications depository library.

RULE 4 (CCR) 723-11-39. CONFLICT.

In the event of a conflict between the provisions of Parts 40 and 199, 49 C.F.R. and this rule, this rule shall govern.

RULE 4 (CCR) 723-11-40. WAIVER.

Waivers of this rule may be granted by the Commission in accordance with 49 U.S.C. § 60118, and 49 C.F.R. Parts 40 and 199.

(4 CCR 723-11) PART VI. THIRD PARTY DAMAGE STATISTICS: ANNUAL REPORT. BASIS, PURPOSE, AND STATUTORY AUTHORITY.

The basis and purpose of these rules is to adopt the reporting requirements of the damage prevention program of the United States Department of Transportation that is set forth in 49 C.F.R. Part 192 (October 1, 2002). The Commission has authority under § 40-2-115(1.5), C.R.S., to adopt such rules as may be necessary to enforce and administer gas pipeline safety in cooperation with the United States Department of Transportation. The Commission has general authority under § 40-2-108, C.R.S., to promulgate such rules as are necessary for the proper administration and enforcement of Title 40 C.R.S. RULE (4 CCR) 723-11-41. DEFINITIONS.

723-11-41.1 “Excavation activity” means any operation in which earth is moved or removed by means of any tools, equipment, or explosives and includes auguring, boring, backfilling, ditching, drilling, grading, plowing-in, pulling-in, ripping, scraping, trenching, and tunneling. 723-11-41.2 “Emergency repair” applies to ruptures and leakage of pipelines, explosions, fires, and similar instances where immediate action is necessary to prevent loss of life or significant property damage and advance notice of proposed excavation is impracticable under the circumstances.

723-11-41.3 “Damage” includes the penetration or destruction of any protective coating, housing, or protective device of an underground facility, the partial or complete severance, denting or puncturing of an underground facility, or the rendering of any underground facility inaccessible. 723-11-41.4 “Damage prevention program” means the operator's or owner's written program to prevent damage to a gas pipeline by excavation as defined under 49 C.F.R. § 192.614. 723-11-41.5 “Operator” or “Owner” means any person, including public utilities, municipal corporations, political subdivisions, or other persons having the right to bury underground natural gas pipeline facilities.

723-11-41.6 “Chief” means the head of the Safety and Enforcement Section of the Public Utilities Commission of the State of Colorado.

RULE (4 CCR) 723-11-42. REPORTING REQUIREMENTS.

723-11-42.1 All owners or operators of pipeline facilities over which the Commission has authority shall document and report pipeline facility damage statistics with the Annual Reports required under Rule 5. A Master Meter Operator need not submit a report on third party damages. These records shall, at a minimum, contain the following: 723-11-42.1.1 Name of excavation company causing damage to the operator's system; 723-11-42.1.2 Location by county, or locate area as defined by the Utility Notification Center of Colorado (“UNCC”), of damaged pipeline;

723-11-42.1.3 Date of locate request and Utility Notification Center ticket number; 723-11-42.1.4 Date of locate by facility owner or operator; 723-11-42.1.5 Date of relocate, if applicable;

723-11-42.1.6 Date damage occurred;

723-11-42.1.7 Damage due to locator error or excavator error; 723-11-42.1.8 Reason for excavation activity (routine or emergency repair), if known; 723-11-42.1.9 Cost to owner or operator due to third party damages; 723-11-42.1.10 Any deaths or injuries resulting from third party damages; 723-11-42.1.11 Total number of monthly locate requests, by county, or locate area as defined by the UNCC.

723-11-42.1.12 Total number of actual monthly locates by county, or locate area as defined by the UNCC.

723-11-42.1.13 Total number of monthly mislocates resulting in damage by county, or locate area as defined by the UNCC.

723-11-42.1.14 Total number of monthly gas pipeline damages to service lines by county, or locate area as defined by the UNCC.

723-11-42.1.15 Total number of monthly gas pipeline damages to mains by county, or locate area as defined by the UNCC.

723-11-42.1.16 Total number of monthly gas pipeline damages to transmission lines by county, or locate area as defined by the UNCC.

723-11-42.1.17 Type of equipment involved in facility damage(track hoe, backhoe, bore rig, etc.). RULE (4 CCR) 723-11-43. WAIVER.

Waivers of Part VI of these rules may be granted by the Chief if not contrary to law and if compliance is found to be impossible, impractical, or unreasonable.