BILL ANALYSIS Date of Hearing: July 5, 1994 SB 1911 ASSEMBLY COMMITTEE ON GOVERNMENTAL ORGANIZATION Curtis R. Tucker, Jr., Chairman SB 1911 (Thompson) - As Amended: June 1, 1994 SUBJECT Propane Tank Safety. DIGEST Existing law requires that every pressure vessel of a certain size used što store air pressure or liquefied petroleum must be inspected either by šthe Division of Occupational Safety and Health in the Department of šIndustrial Relations or a certified inspector, and be in compliance with šsafety standards promulgated by the Cal-OSHA Standards Board. The board is šrequired to adopt standards designated to promote safety in the operation šof vendor facilities which store and dispense liquefied natural gas or špetroleum gas into vehicles. The division can prohibit the use of pressure švessels or tanks found to be in an unsafe or dangerous condition. This bill: 1) Enacts the Propane Storage and Handling Safety Act. 2) Requires the State Fire Marshal (SFM) in conjunction with the Cal-OSHA Standards Board to adopt by reference the 1992 edition of the National Fire Protection Association's (NFPA) standards for the storage and handling of liquefied petroleum gasses, and that it is the intent of the Legislature that these NFPA 58 standards supersede any existing state standards which are inconsistent. 3) Require the SFM in cooperation with the Department of Industrial Relations as appropriate to inspect and certify the safety of all propane storage systems prior to January 1, 1997. Storage systems are defined as those for commercial storage of more than 4,000 gallons of propane. 4) After January 1, 1998, require the SFM to annually inspect all propane storage systems. 5) Require the adoption of building code standards for the siting and construction of fixed storage systems. 6) Require adoption of fire standards and training requirements for handling of propane storage systems; require adoption of standards for training firefighting personnel responding to fires involving propane storage systems; and require the SFM to issue operator certificates to persons handling propane storage systems. 7) Require the SFM to report to the Legislature on the condition of propane SB 1911 storage systems statewide which identifies the location of systems inspected, fire safety violations found, and compliance and remedial actions taken. The SFM shall also recommend needed remedial legislation. 8) Require an owner or operator of a propane storage system to carry liability insurance in an amount of not less than $500,000. 9) Provide for inspection and regulation fees of not more than $250 per propane storage system, not to exceed the actual cost of inspections and regulations. FISCAL EFFECT According to the SFM, the cost of implementing this program would be š$800,000. The $250 fee provisions would generate approximately $125,000. COMMENTS 1) Purpose This legislation is an outgrowth of a propane fire accident which occurred last year in Yountville. An employee of a hot air balloon company attempting to fuel a balloon's propane tanks at a commercial propane distributor's establishment inadvertently caused a leak which ignited causing minor injuries to the employee and extensive damage to the facility. Had the fire department not been able to quickly extinguish the propane fire, it is probable that extensive damage would have occurred to neighboring buildings because of the close proximity of the propane tanks to these structures. 2) Duplication of Effort Requiring the State Fire Marshal to establish a new program to regulate and inspect large propane tank systems would in large part duplicate the pressure vessel inspection program in the Division of Occupational Safety and Health which has been in existence for many years. If there are shortcomings in this program concerning either the frequency of inspections or the efficacy of safety standards, shouldn't improvement be made in this program instead of creating another regulatory bureaucracy? 3) New Pending Federal Requirements Recent amendments to the federal Clean Air Act create a federal hazardous materials accident prevention program requiring the Environmental Protection Agency to adopt regulations requiring facilities that manufacture, store or transport certain hazardous materials, including - continued - SB 1911 Page 2 SB 1911 propane, to adopt and implement a risk management plan. The regulations, šwhich are slated for final adoption in late 1995, will cover most if not šall of the requirements contained in this legislation for the safe šhandling of propane, and, more importantly, will pre-empt any state šregulations for the storage and handling of propane and other hazardous šmaterials. 4) Which Standards Should be Used? This measure requires NFPA 58 standards for the storage and handling of propane to be adopted in whole, and to supersede existing safety standards adopted by the Cal-OSHA Standards Board The propane industry maintains that NFPA 58 standards are superior to current state Title 8 standards. The division, however, maintains that many of NFPA 58 standards provide a lesser degree of safety than Title 8 standards. Pressure vessel standards contained in Title 8 standards are currently being revised and updated by the Cal-OSHA Standards Board, and should be completed later this year. Date of Hearing: July 5, 1994 SUPPORT Suburban Propane OPPOSITION California Teamsters Public Affairs Council State Fire Marshal Britton McFetridge SB 1911 445-3451 Page 3 ago