ILTA Comments on the State of Washington Crude Oil By Rail—Vapor Pressure Requirements

Comments on Hazardous Materials: The State of Washington Crude Oil by Rail—Vapor Pressure Requirements
Docket No. PHMSA-2019-0149
August 20, 2019

The International Liquid Terminals Association (ILTA) is pleased to provide comments on North Dakota’s and Montana’s request for a preemption determination on the July 2019 Washington State law Crude Oil by Rail–Vapor Pressure. ILTA asks that the Pipeline and Hazardous Materials Safety Administration (PHMSA) find that Washington State’s law limiting the Reid Vapor Pressure of crude oil is preempted by Federal Hazardous Materials Regulations (HMR). The state law is also in conflict with the Dormant Commerce Clause of the U.S. Constitution, which prevents states from interfering with interstate commerce between the states.

The HMR are essential regulations that ensure consistency across the United States for the regulation of hazardous materials in transportation, such as petroleum crude oil. The transportation of petroleum crude oil is regulated by PHMSA under 49 CFR 172. If every jurisdiction could specify the properties of commodities involved in interstate commerce that move through their jurisdiction, the supply chain for such commodities would be unworkable. PHMSA must assert its jurisdiction over the properties of hazardous materials in transportation and find that the Washington State Law is preempted.

Several ILTA members operate liquid terminals in the State of Washington that either handle or have handled in the past crude oil for refining or for export. By limiting the amount of crude with an RVP greater than or equal to 9 psi based on 2018 volumes handled, the state interferes with terminal operators’ ability to enter the market or to adjust their operations to meet changes in market demand and creates an uneven playing field that allows some facilities to more readily respond to the market. Not only would this prevent new terminals from coming into the market it would prevent those operators whose facilities may have handled little or no crude in 2018 from adjusting their volumes upward even if they handled greater volumes prior to 2018.

Founded in 1974, the International Liquid Terminals Association represents more than 85 companies operating liquid terminals in all 50 states and in over 40 countries. Our members’ facilities provide critical links between all modes of transportation for liquid commodities, such as crude oil, petroleum products, chemicals, renewable fuels, fertilizer, vegetable oils and other food-grade materials that are central to the U.S. economy. Terminals provide essential logistics services that spur trade both within the United States and connect the U.S. economy with

overseas markets. ILTA’s membership also includes nearly 400 companies that supply equipment and services to the terminal industry.

Sincerely,

Peter Lidiak
Vice President, Regulatory Affairs International Liquid Terminals Association

c: Wayne Stenehjem, Attorney General, The State of North Dakota Tim Fox, Attorney General, The State of Montana
Vincent Lopez, Office of the Chief Counsel, PHMSA

I certify that copies of these comments have been sent to Mr. Stenehjem and Mr. Fox at the addresses specified in the Federal Register (84 FR 35707).