- The Washington Times - Thursday, December 28, 2000

The $674,000 federal fine slapped on Potomac Electric Power Co. this month is only the first of several legal problems the public utility must confront this winter following an oil spill last April in Southern Maryland.

Next month, Maryland Sen. Roy Dyson plans to introduce a bill that will give the state authority to inspect pipelines, rather than leaving the job to federal agencies. In addition, two court hearings are planned on lawsuits filed against Pepco by residents of the area damaged by the oil spill.

Until now, Maryland legislators have left inspection of the state's pipelines to the U.S. Department of Transportation's Office of Pipeline Safety. Mr. Dyson's legislation would shift authority to state monitoring and jurisdiction.

A similar dispute about local or federal control is at issue in private lawsuits against Pepco. The utility wants liability issues to be determined in arbitration under authority of the federal Oil Pollution Act. The business owners, residents and fishermen who filed lawsuits want local courts to decide whether Pepco pays them compensation.

Pepco already lost one of its legal battles, to get the dispute resolved by arbitration. A hearing on Pepco's appeal is scheduled for Jan. 26 in federal district court in Greenbelt. A separate hearing scheduled for Jan. 8 in state court in St. Mary's County will decide whether the court grants Pepco's motion to dismiss some of the lawsuits.

Phil Dorsey, one of the attorneys representing the property owners, is opposing Pepco's efforts to restrict control over the case to federal authorities.

"The citizens want their day in court," Mr. Dorsey said. "They want the opportunity to be heard by their citizenry and a judge."

Pepco has tried to blame a contractor, Pipetronics, and its parent company, ST Services. The utility hired them to conduct pipeline inspections.

"The big question is this: Who knew what and when?" Mr. Dorsey said.

No one disputes the effects of the leak, which spilled more than 100,000 gallons of fuel oil into the Patuxent River, connecting waterways and along the shoreline near the Chalk Point power plant. An April 8-9 storm and high winds spread the oil over containment booms into a 17-square-mile area, killing more than 100 birds, mammals and reptiles. The National Transportation Safety Board found a 6-inch-by-half-inch crack in the pipeline.

Pepco originally reported that only 2,000 gallons spilled from the crack on April 7. Mr. Dorsey, however, estimated the spill at 130,000 gallons. He said the pipeline might have been leaking for months before the crack widened and became noticeable.

The safety violations cited by the Transportation Department against Pepco and ST Services include underreporting the amount of the spill, failing to operate the pipeline properly and failing to have adequate procedures for an emergency.

Mr. Dorsey said the only way to sort out the blame and prevent similar accidents is by making certain a court rules on the case.

"We want the people of the community to realize the environmental damage that's been done," Mr. Dorsey said.

Even if a court determines liability, state legislators must determine whether they will take over control from federal regulators.

According to the U.S. Department of Transportation, any state has the discretion to assume control over the safety of pipelines that run exclusively within that state. The only restriction is that the state's safety regulations cannot fall below federal standards.

"We have encouraged Maryland to take over authority," said Patricia Klinger, Transportation Department spokeswoman. "They do it with their gas program, but not their liquid program."

Pepco officials are trying to stay out of the debate. This month, Pepco sold off the pipeline, along with four electric-generating facilities, to Southern Energy Inc. in a $2.75 billion deal.

"What the company has felt is that it's a matter of public debate," said Nancy Moses, Pepco spokeswoman. "At this point, we don't own any pipelines."

Regarding the oil spill, Miss Moses said any underreporting by Pepco resulted from confusion in the first minutes after it was discovered. "We reported it immediately, and that's the primary concern," she said.

After Pepco inspectors determined a spill larger than 2,000 gallons occurred, the utility upped its estimate in reports to emergency teams from the U.S. Coast Guard and the Maryland Department of the Environment, Miss Moses said.

She said the sale Dec. 19 was unrelated to the April oil spill.

"The reason we sold our generating facilities is we could not be competitive in this area," Miss Moses said. "We're not large enough. We specialize in being a distribution company."

Any state control over pipelines would require setting up a new bureaucracy and inspection system that until now has been left to the federal government, she said.

Mr. Dyson and his supporters, however, say the cost would be worth it. Federal inspectors are too lax in ensuring safety of the pipelines. The only way to adequately protect local residents is with state inspection, Mr. Dyson said.

"I think we do a fairly decent job, considering the resources we have," Miss Klinger said. She acknowledged, however, that states sometimes can do a better job of regulating safety because of their familiarity with local hazards.

"They understand the local concerns," she said. The federal government will fund as much as 50 percent of a state's costs in regulating intrastate-pipeline safety.

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