deal or no deal

Back in April, Sunoco and the Public Utility Commission (PUC) announced the settlement of a case before the PUC that resulted from a leak in the Dragonpipe (Mariner East 1, in this case) near Morgantown. The case was brought by the PUC’s own independent investigations branch, the Bureau of Investigation and Enforcement (BI&E). At the time, I wasn’t very enthusiastic about the terms of the settlement (see “The BI&E compromise with Sunoco: on balance, it’s not a good deal”).

The settlement still had to be confirmed by vote of the five commissioners, which seemed likely. At the time, I wrote: “… it is likely that the PUC will vote to adopt the settlement. They have generally been friendly toward pipeline operators, and they have a policy of encouraging settlements, rather than incurring the time and expense of hearings.”

My hunch was wrong. It turns out that the PUC commissioners weren’t very enthusiastic either. In an interesting turn of events, at their May 23, 2019 public meeting, the PUC commissioners voted not to confirm the settlement. Instead, they voted 5-0 in favor of sending the case back to one of the PUC’s administrative law judges (ALJs) to consider “such further proceedings and the scheduling of hearings as may be deemed necessary”.

Issues were left unresolved by the draft settlement. The basic arguments for having an ALJ deal with this issue were laid out in a motion written by Commissioner John Coleman. (The full text of Coleman’s motion is here.) Coleman notes that some issues were left hanging by the draft settlement, including:

  1. Were there violations of state or federal law in this case? Sunoco asserts that there were none, but the evidence was never examined.
  2. Five organizations and individuals petitioned to intervene in the case, but they never got a chance to weigh in on it. (Additional petitions to intervene are still pending.)
  3. After the announcement of the draft settlement, a formal document opposing it was filed, but it never got a hearing.

While noting that the PUC has previously confirmed negotiated settlements without any hearings in some instances, Coleman writes: “In the interests of ensuring that due process is afforded to all interested parties, I conclude that it is appropriate to refer this matter to the Office of Administrative Law Judge for determinations on the Petitions to Intervene and the Response in Opposition to Approval….”

Hearings are necessary. Two other commissioners (Andrew Place and David Sweet) put out a joint statement that also supported turning the matter over to an ALJ for “further proceedings and scheduling of hearings….” Their statement (full text here) is even stronger than Coleman’s. While Coleman argues that the commissioners have discretion to send the case back to an ALJ, Place and Sweet appear to believe that they have an obligation to do so. They basically argue that settlements without hearings are appropriate for informal complaints where the basic facts are not in dispute and there are only two parties involved. But given the circumstances of this case (a formal complaint with multiple intervenors and disputed facts) Place and Sweet write that “we firmly believe that … this case should be referred to the Office of Administrative Law Judge….”

So now the case goes back to the Office of Administrative Law Judge, where (almost certainly) it will be assigned to an ALJ. I assume there is a good chance that it would be assigned to ALJ Elizabeth Barnes, who has handled all the Mariner East cases so far and has appeared open to some of the criticisms of Sunoco that have been voiced in previous hearings.

If it is assigned to Barnes, and if she decides there should indeed be hearings, we will learn a lot about the inexcusable pipeline maintenance failures that led to the Morgantown leak. Sunoco is likely to do everything in its power to prevent such hearings.