Reprinted

February 26, 2007



SENATE BILL No. 529

_____


DIGEST OF SB 529 (Updated February 26, 2007 6:37 pm - DI 101)



Citations Affected: IC 8-1; IC 32-24.

Synopsis: Requires the pipeline safety division (division) of the utility regulatory commission (IURC) to adopt guidelines governing the construction of interstate pipelines in Indiana. Requires the guidelines to be adopted not later than September 1, 2007. Requires the division to publish the guidelines in the Indiana Register as a nonrule policy document. Requires the division to consider adopting less burdensome or less costly guidelines for pipeline companies that locate a pipeline along existing rights-of-way or easements. Specifies certain standards that the guidelines may include. Provides that the guidelines are not binding on any pipeline company or affected landowner. Provides that the guidelines may be used by a pipeline company or an affected landowner to simplify negotiations involved in establishing a price for any: (1) easement; or (2) other land interest; needed to construct a pipeline. Requires the division to send a notice of the guidelines and other required information to: (1) a pipeline company that proposes to construct a pipeline in Indiana; and (2) all affected landowners. Requires a pipeline company to communicate, by a date specified in the division's notice, the pipeline company's intention to do one of the following: (1) Comply with the guidelines. (2) Reject the guidelines and negotiate different or amended guidelines with the division. (3)
(Continued next page)

Effective: Upon passage.



Jackman , Lawson C, Bray, Rogers


    January 23, 2007, read first time and referred to Committee on Utilities & Regulatory Affairs.
    February 22, 2007, amended, reported favorably _ Do Pass.
    February 26, 2007, read second time, amended, ordered engrossed.


Digest Continued

Reject the division's guidelines and negotiate standards with individual landowners as necessary to obtain easements or other interests in land. Requires the director of the division to designate one or more employees as project coordinators for each pipeline project. Requires the division to make certain information available on the IURC's web site. Provides that a public utility or a pipeline company that seeks to acquire land by eminent domain may not enter on the land for survey purposes unless the public utility or pipeline company: (1) sends notice by certified mail to the landowner of the public utility's or pipeline company's intention to enter the land for survey purposes; or (2) receives the landowner's signed consent to enter the land to perform the proposed survey.

Reprinted

February 26, 2007

First Regular Session 115th General Assembly (2007)


PRINTING CODE. Amendments: Whenever an existing statute (or a section of the Indiana Constitution) is being amended, the text of the existing provision will appear in this style type, additions will appear in this style type, and deletions will appear in this style type.
Additions: Whenever a new statutory provision is being enacted (or a new constitutional provision adopted), the text of the new provision will appear in this style type. Also, the word NEW will appear in that style type in the introductory clause of each SECTION that adds a new provision to the Indiana Code or the Indiana Constitution.
Conflict reconciliation: Text in a statute in this style type or this style type reconciles conflicts between statutes enacted by the 2006 Regular Session of the General Assembly.

SENATE BILL No. 529


    A BILL FOR AN ACT to amend the Indiana Code concerning utilities and transportation.

Be it enacted by the General Assembly of the State of Indiana:

SOURCE: IC 8-1-22.6; (07)SB0529.2.1. -->     SECTION 1. IC 8-1-22.6 IS ADDED TO THE INDIANA CODE AS A NEW CHAPTER TO READ AS FOLLOWS [EFFECTIVE UPON PASSAGE]:
     Chapter 22.6. Pipeline Construction Guidelines
    Sec. 1. (a) This chapter applies to the construction of any segment of an interstate pipeline on privately owned land in Indiana.
    (b) Except as otherwise provided in the guidelines adopted by the division under section 9 of this chapter, this chapter does not apply to construction activities that occur entirely on:
        (1) a public right-of-way;
        (2) a railroad right-of-way; or
        (3) publicly owned land.
    Sec. 2. As used in this chapter, "affected landowner" means an owner of an interest in property that:
        (1) is located in Indiana; and
        (2) meets one (1) or more of the conditions set forth in 18 CFR

157.6(d)(2).
    Sec. 3. As used in this chapter, "agricultural land" means land that is:
        (1) assessed as agricultural land for property taxes purposes;
        (2) zoned or otherwise designated as agricultural land;
        (3) used for growing crops or raising livestock; or
        (4) reserved for conservation under a government program.
    Sec. 4. As used in this chapter, "commission" refers to the Indiana utility regulatory commission created by IC 8-1-1-2.
    Sec. 5. (a) "Construction" or "construction activity" means the physical work involved in the construction, reconstruction, improvement, maintenance, or extension of a pipeline project.
    (b) The term includes the following:
        (1) The preparation of the construction site.
        (2) Disassembling and removing a structure.
        (3) Related work.
     Sec. 6. As used in this chapter, "division" refers to the pipeline safety division of the Indiana utility regulatory commission established by IC 8-1-22.5-2.
     Sec. 7. As used in this chapter, "pipeline" means a pipeline (as defined in IC 8-1-22.5-1(c)) that crosses or is located in:
        (1) Indiana; and
        (2) one (1) or more other states.
    Sec. 8. (a) As used in this chapter, "pipeline company " means a person (as defined in IC 8-1-22.5-1(e)) that:
        (1) constructs; or
        (2) proposes to construct;
a pipeline.
    (b) The term includes any:
        (1) employee;
        (2) agent;
        (3) contractor;
        (4) subcontractor;
        (5) or other person;
that is employed by, or acts on behalf of, a pipeline company.
    Sec. 9. (a) Not later than September 1, 2007, the division shall adopt guidelines governing the construction of a pipeline, or any segment of a pipeline, in Indiana. The guidelines adopted by the division under this section may include the following standards, to the extent not preempted by federal law:
        (1) Standards specifying minimum depths at which a pipeline must be buried based on the topography and use of the land.

In adopting any standards to establish burial depths for pipeline that crosses agricultural land, the division may specify depths that are appropriate for the land based on whether the land:
                (i) is used for crops or as pasture; or
                (ii) is comprised of soils that are classified by the United States Department of Agriculture as being prime soils.
        (2) Standards for replacing topsoil removed during excavations performed in connection with pipeline construction or burial. Standards adopted under this subdivision may include requirements for any of the following:
            (A) The segregation of topsoil and subsoil during excavation.
            (B) The removal of rocks, construction debris, or other materials from the topsoil before replacement.
            (C) The prevention of topsoil erosion.
            (D) The alleviation of topsoil compaction.
            (E) The restoration of soil on an affected landowner's property to the soil's preconstruction condition.
        (3) Standards requiring a pipeline company to prevent or remedy damage to underground drainage tiles during construction of the pipeline. Standards adopted under this subdivision may require a pipeline company to do any of the following:
            (A) Take certain actions to prevent damage to underground drainage tiles, including locating and staking all tile lines before construction.
            (B) Maintain a specified distance between underground drainage tiles and the pipeline during the placement or construction of the pipeline.
            (C) Probe or examine tile lines located in construction sites to determine whether any tile has been damaged during construction.
            (D) Repair or replace any underground drainage tiles that are damaged during construction.
        (4) Standards for the removal of construction debris from an affected landowner's property during and after all construction activity.
        (5) Standards for restoring land to its preconstruction condition, including the restoration of the land's elevation and contour through leveling or other land restoration practices.

        (6) Standards governing the removal of trees from an affected landowner's property in connection with the construction of a pipeline.
        (7) Standards governing a pipeline company's duties to an affected landowner when the pipeline company's construction activities cause an interruption in the affected landowner's use of an irrigation system on agricultural land.
        (8) Standards governing the determination of routes to be used by a pipeline company in accessing a temporary or permanent easement on an affected landowner' s property for construction or maintenance purposes, including the location of any temporary roads used in connection with construction activities.
        (9) Standards governing a pipeline company's use of surface rights-of-way, including any:
            (A) valve sites;
            (B) metering stations;
            (C) compression stations; or
            (D) other locations in which pipeline facilities or appurtenances are located.
        (10) Standards governing the pumping of water from any open trenches on an affected landowner's property during construction.
        (11) Subject to IC 32-24-1-3(g), standards requiring a pipeline company to:
            (A) provide advance notice to; or
            (B) seek the permission of;
        an affected landowner before entering the landowner's property to perform survey, inspection, construction, or maintenance activities.
        (12) Standards establishing a method for an affected landowner to report any construction activities or repairs that:
            (A) are performed by a pipeline company on the affected landowner's property; and
            (B) violate, or appear to the landowner to violate, any standards that are:
                (i) included in the guidelines adopted by the division under this section and agreed to by the pipeline company; or
                (ii) otherwise agreed to by the pipeline company.
        (13) Standards for:
            (A) compensating affected landowners for damage to private property as a result of construction activities; or
            (B) repairing or replacing private property that is damaged as a result of construction activities.
        Standards adopted under this subdivision may specify that a pipeline company's obligations with respect to damaged property extends beyond the initial construction of the pipeline to include damages caused by the pipeline company during future construction, operation, maintenance, and repair activities related to the pipeline.
        (14) Standards setting forth the time frame in which a pipeline company must make any repairs or take any other mitigative actions that are:
            (A) prescribed in the guidelines adopted by the division under this section; and
            (B) agreed to by the pipeline company.
        (15) Standards requiring a pipeline company to indemnify an affected landowner against any claims or damages resulting from or arising out of:
            (A) the pipeline company's construction, maintenance, operation, repair, removal, or use of pipeline on the landowner's property; or
            (B) the existence of the pipeline on the landowner's property;
        except for claims or damages resulting from or arising out of the landowner's negligence, intentional acts, or willful omissions.
        (16) Any other standards that:
            (A) the division determines are necessary and in the public interest; and
            (B) do not conflict with the requirements of:
                (i) any federal, state, or local regulations or rules; or
                (ii) any permits or approvals required to be obtained by a pipeline company in connection with a pipeline construction project.
    (b) The division may adopt the guidelines required by subsection (a) using the same streamlined procedures by which emergency rules may be adopted under IC 4-22-2-37.1. The division shall cause the guidelines adopted under subsection (a) to be published in the Indiana Register as a nonrule policy document.
    (c) The guidelines adopted by the division under subsection (a) shall not be binding on any pipeline company or affected

landowner but may be used by a pipeline company or an affected landowner to simplify negotiations involved in establishing a price for any:
        (1) easement; or
        (2) other interest in land;
needed by the pipeline company to construct a pipeline.
    (d) In adopting the guidelines required by subsection (a), the division may consider adopting less intrusive or less costly alternative guidelines for pipeline companies that locate, or plan to locate, a pipeline along existing rights of way or easements. The division may consider the following methods of minimizing the burdens or costs of compliance for pipeline companies described in this subsection:
        (1) The establishment of less stringent guidelines governing the construction, maintenance, or repair of the pipeline.
        (2) The establishment of less stringent schedules or deadlines for construction, maintenance, or repair activities.
        (3) The consolidation or simplification of construction, maintenance, or repair guidelines.
        (4) An exemption from part or all of a particular guideline.
    (e) In adopting the guidelines required by subsection (a), the division may consult with other states, or agencies of other states, that have adopted similar guidelines for the construction of pipelines. The division may also consult with any of the following:
        (1) Other state agencies in Indiana.
        (2) Any political subdivisions in Indiana in which pipelines are located or proposed to be located.
        (3) Public utilities, municipally owned utilities, or cooperatively owned utilities.
        (4) Pipeline companies.
        (5) Organizations representing agricultural interests in Indiana.
        (6) Other individuals or organizations that have an interest in, or are knowledgeable about, pipelines or pipeline construction.
    Sec. 10. (a) For purposes of this section, a pipeline company proposes to construct a pipeline in Indiana if it does any of the following:
        (1) Files an application for a certificate of public convenience and necessity with the Federal Energy Regulatory Commission.
        (2) Undertakes:

            (A) environmental, engineering, or cultural surveys; or
            (B) other studies or surveys;
        in Indiana in preparation for filing an application described in subdivision (1).
        (3) Holds public meetings or hearings in Indiana concerning a proposed pipeline.
        (4) Enters upon land in Indiana for the purpose of determining the route or location of a proposed pipeline.
        (5) Contacts landowners in Indiana for the purpose of negotiating the price for:
            (A) easements; or
            (B) other interests in land;
        necessary for the construction of a pipeline.
        (6) Undertakes other actions in preparation for the construction of a pipeline.
    (b) The division shall send, by certified mail, the following to each pipeline company that proposes to construct a pipeline in Indiana:
        (1) A copy of the guidelines adopted by the division under section 9 of this chapter.
        (2) A notice that includes the following:
            (A) A statement that the division has adopted the pipeline construction guidelines included with the notice.
            (B) A statement indicating:
                (i) that the pipeline construction guidelines have been mailed to all affected landowners, as determined by the division under section 11(a) of this chapter; and
                (ii) that the division has encouraged the affected landowners to agree to the guidelines in any negotiations for easements or other land interests with the pipeline company.
            (C) A statement asking the pipeline company to agree to comply with the construction guidelines included with the notice. The statement required by this clause must specify a method and deadline by which the pipeline company must do one (1) of the following:
                (i) Indicate the pipeline company's agreement to comply with the guidelines.
                (ii) Reject the guidelines and request a conference with the division to negotiate different or amended guidelines.
                (iii) Reject the division's guidelines and negotiate construction standards with individual landowners as

necessary to obtain easements or other interests in land.
            (D) A statement indicating that any guidelines agreed to by the pipeline company under clause (C) shall not be binding on the pipeline company or affected landowners but may be used by the pipeline company and an individual landowner to simplify negotiations involved in establishing a price for any:
                (i) easement; or
                (ii) other interest in land;
            needed by the pipeline company to construct the pipeline.
            (E) A statement including the contact information for the one (1) or more project coordinators designated by the division under section 12 of this chapter.
    (c) The division shall mail the guidelines and notice in accordance with subsection (b):
        (1) as soon as the division learns of the proposed pipeline as a result of the pipeline company performing one (1) or more actions described in subsection (a); or
        (2) not later than three (3) business days after the Federal Energy Regulatory Commission provides notice under 18 CFR 157.9(a) of the pipeline company's application for a certificate of territorial authority;
whichever occurs earlier.
    Sec. 11. (a) For purposes of this section, the division shall, to the extent practicable, determine the affected landowners with respect to a proposed pipeline project from any of the following:
        (1) Any actions described in section 10(a) of this chapter that are undertaken by the pipeline company.
        (2) Any information on the pipeline's location, including any maps, that is included in a notice given by:
            (A) the pipeline company under 18 CFR 157.6(d)(1); or
            (B) the Federal Energy Regulatory Commission under 18 CFR 157.9(a).
        (3) The tax records of each county that contains land that will be crossed or used by the proposed pipeline.
    (b) The division shall send, by certified mail, the following to each affected landowner:
        (1) A copy of, or reference to, the guidelines adopted by the division under section 9 of this chapter.
        (2) A notice that includes the following:
            (A) A statement that the division has adopted the pipeline construction guidelines included with, or referenced in, the

notice.
            (B) A statement indicating:
                (i) that the pipeline construction guidelines have been mailed to the pipeline company; and
                (ii) that the division has asked the pipeline company to agree to the guidelines in any negotiations for easements or other land interests with affected landowners.
            (C) A statement indicating the date by which the pipeline company must:
                (i) agree to comply with the guidelines;
                (ii) reject the guidelines and negotiate different or amended guidelines with the division; or
                (iii) reject the division's guidelines and decide to negotiate construction standards with individual landowners in connection with negotiating a price for easements or other interests in land necessary for the construction of the pipeline.
            The statement required by this clause must specify a date after which the affected landowner may contact a toll free telephone number established by the division to provide information on the status of any construction guidelines agreed to by the pipeline company.
            (D) A statement indicating that any guidelines agreed to by the pipeline company shall not be binding on the pipeline company or affected landowners but may be used by the pipeline company and an individual landowner to simplify negotiations involved in establishing a price for any:
                (i) easement; or
                (ii) other interest in land;
            needed by the pipeline company to construct the pipeline.
            (E) A statement encouraging the affected landowner to agree to any construction guidelines that the pipeline company agrees to follow, to the extent that the landowner determines that the guidelines are not contrary to the landowner's best interests.
            (F) A statement including:
                (i) contact information for the one (1) or more project coordinators designated by the division under section 12 of this chapter;
                (ii) contact information for the Federal Energy Regulatory Commission, including a local or toll free telephone number; and

                (iii) the commission's web site address.
    (c) The division shall mail the information required under subsection (b) not later than twenty (20) days after:
        (1) the division learns of the proposed pipeline as a result of the pipeline company performing one (1) or more actions described in section 10(a) of this chapter; or
        (2) the Federal Energy Regulatory Commission provides notice under 18 CFR 157.9(a) of the pipeline company's application for a certificate of territorial authority;
whichever occurs earlier.
    Sec. 12. For each proposed or ongoing pipeline project in Indiana, the director of the division shall designate one (1) or more employees of the division to serve as project coordinators for the division. The director shall ensure that one (1) or more of the coordinators designated under this section are responsible for the following duties concerning the project:
        (1) Monitoring all:
            (A) filings with; and
            (B) proceedings before;
        the Federal Energy Regulatory Commission.
        (2) Attending all public hearings or meetings concerning the project that are held in Indiana.
        (3) Receiving and responding to questions and complaints about the project from Indiana residents.
        (4) Updating the information required to be made available on the commission's web site under section 13 of this chapter.
        (5) Any other duties assigned by the director of the division.
    Sec. 13. (a) The division shall make the following available on the commission's web site:
        (1) A link to the guidelines adopted by the division under section 9 of this chapter.
        (2) For each proposed or ongoing pipeline construction project in Indiana, the following information:
            (A) A description of the pipeline company and the pipeline project, including:
                (i) the pipeline's location, purpose, and construction schedule; and
                (ii) the docket number assigned to the project by the Federal Energy Regulatory Commission.
            (B) Contact information for the pipeline company, including a local or toll free telephone number.
            (C) Contact information for the Federal Energy

Regulatory Commission, including a local or toll free telephone number.
            (D) Contact information for the one (1) or more project coordinators designated under section 12 of this chapter to receive and respond to questions and complaints from Indiana residents.
            (E) Information on public hearings or meetings that are scheduled in connection with the pipeline project.
            (F) Other information concerning the pipeline project that the division considers relevant or of likely concern to Indiana residents.
    (b) The division shall update the information required under subsection (a)(1) whenever:
        (1) one (1) or more guidelines adopted under section 9 of this chapter are amended or repealed by the division; or
        (2) one (1) or more new guidelines are adopted by the division.
    (c) The division shall update the information required under subsection (a)(2) on a regular basis throughout the course of a pipeline project. The division shall ensure that all information on the division's web site concerning a pipeline project is accurate, current, and accessible. The director of the division shall assign the responsibility of complying with this subsection to one (1) or more project coordinators designated under section 12 of this chapter.

SOURCE: IC 32-24-1-3; (07)SB0529.2.2. -->     SECTION 2. IC 32-24-1-3, AS AMENDED BY P.L.163-2006, SECTION 5, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE UPON PASSAGE]: Sec. 3. (a) Any person that may exercise the power of eminent domain for any public use under any statute may exercise the power only in the manner provided in this article, except as otherwise provided by law.
    (b) Except as provided in subsection (g), before proceeding to condemn, the person:
        (1) may enter upon any land to examine and survey the property sought to be acquired; and
        (2) must make an effort to purchase for the use intended the land, right-of-way, easement, or other interest, in the property.
    (c) The effort to purchase under subsection (b)(2) must include the following:
        (1) Establishing a proposed purchase price for the property.
        (2) Providing the owner of the property with an appraisal or other evidence used to establish the proposed purchase price.
        (3) Conducting good faith negotiations with the owner of the property.
    (d) If the land or interest in the land, or property or right is owned by a person who is an incapacitated person (as defined in IC 29-3-1-7.5) or less than eighteen (18) years of age, the person seeking to acquire the property may purchase the property from the guardian of the incapacitated person or person less than eighteen (18) years of age. If the purchase is approved by the court appointing the guardian and the approval is written upon the face of the deed, the conveyance of the property purchased and the deed made and approved by the court are valid and binding upon the incapacitated person or persons less than eighteen (18) years of age.
    (e) The deed given, when executed instead of condemnation, conveys only the interest stated in the deed.
    (f) If property is taken by proceedings under this article, the entire fee simple title may be taken and acquired.
    (g) This subsection applies to a public utility (as defined in IC 32-24-1-5.9(a)) or a pipeline company ( as defined in IC 8-1-22.6-8). If a public utility or a pipeline company seeks to acquire land or an interest in land under this article, the public utility or pipeline company may not enter upon the land to examine or survey the property sought to be acquired unless either of the following occur:
        (1) The public utility or the pipeline company sends notice by certified mail to the affected landowner (as defined in IC 8-1-22.6-2) of the public utility's or the pipeline company's intention to enter upon the landowner's property for survey purposes. The notice required by this subdivision must be mailed not later than fourteen (14) days before the date of the public utility's or the pipeline company's proposed examination or survey.
        (2) The public utility or the pipeline company receives the landowner's signed consent to enter the property to perform the proposed examination or survey.
An affected landowner may bring an action to enforce this subsection in the circuit court of the county in which the landowner's property is located. A prevailing landowner is entitled to the landowner's actual damages as a result of the public utility's or the pipeline company's violation. In addition, the court may award a prevailing landowner reasonable costs of the action and attorney's fees.
SOURCE: ; (07)SB0529.2.3. -->     SECTION 3. An emergency is declared for this act.