If PHMSA conducts a facility design and/or construction safety review or inspection in connection with a proposal to construct, expand, or operate a gas, hazardous liquid or carbon dioxide pipeline facility, or a liquefied natural gas facility that meets the applicability requirements in § 190.403, PHMSA may require the applicant proposing the project to pay the costs incurred by PHMSA relating to such review, including the cost of design and construction safety reviews or inspections.

The following paragraph specifies which projects will be subject to the cost recovery requirements of this section.

(a) This section applies to any project that—

(1) Has design and construction costs totaling at least $2,500,000,000, as periodically adjusted by PHMSA, to take into account increases in the Consumer Price Index for all urban consumers published by the Department of Labor, based on—

(i) The cost estimate provided to the Federal Energy Regulatory Commission in an application for a certificate of public convenience and necessity for a gas pipeline facility or an application for authorization for a liquefied natural gas pipeline facility; or

(ii) A good faith estimate developed by the applicant proposing a hazardous liquid or carbon dioxide pipeline facility and submitted to the Associate Administrator. The good faith estimate for design and construction costs must include all of the applicable cost items contained in the Federal Energy Regulatory Commission application referenced in § 190.403(a)(1)(i) for a gas or LNG facility. In addition, an applicant must take into account all survey, design, material, permitting, right-of way acquisition, construction, testing, commissioning, start-up, construction financing, environmental protection, inspection, material transportation, sales tax, project contingency, and all other applicable costs, including all segments, facilities, and multi-year phases of the project;

(2) Uses new or novel technologies or design, as defined in § 190.3.

(b) The Associate Administrator may not collect design safety review fees under this section and 49 U.S.C. 60301 for the same design safety review.

(c) The Associate Administrator, after receipt of the design specifications, construction plans and procedures, and related materials, determines if cost recovery is necessary. The Associate Administrator's determination is based on the amount of PHMSA resources needed to ensure safety and environmental protection.

For any new pipeline facility construction project in which PHMSA will conduct a design review, the applicant proposing the project must notify PHMSA and provide the design specifications, construction plans and procedures, project schedule and related materials at least 120 days prior to the commencement of any of the following activities: Route surveys for construction, material manufacturing, offsite facility fabrications, construction equipment move-in activities, onsite or offsite fabrications, personnel support facility construction, and any offsite or onsite facility construction. To the maximum extent practicable, but not later than 90 days after receiving such design specifications, construction plans and procedures, and related materials, PHMSA will provide written comments, feedback, and guidance on the project.

PHMSA and the applicant will enter into an agreement within 60 days after PHMSA received notification from the applicant provided in § 190.405, outlining PHMSA's recovery of the costs associated with the facility design safety review.

(a) A Master Agreement, at a minimum, includes:

(1) Itemized list of direct costs to be recovered by PHMSA;

(2) Scope of work for conducting the facility design safety review and an estimated total cost;

(3) Description of the method of periodic billing, payment, and auditing of cost recovery fees;

(4) Minimum account balance which the applicant must maintain with PHMSA at all times;

(5) Provisions for reconciling differences between total amount billed and the final cost of the design review, including provisions for returning any excess payments to the applicant at the conclusion of the project;

(6) A principal point of contact for both PHMSA and the applicant; and

(7) Provisions for terminating the agreement.

(8) A project reimbursement cost schedule based upon the project timing and scope.

(b) [Reserved]

The fee charged is based on the direct costs that PHMSA incurs in conducting the facility design safety review (including construction review and inspections), and will be based only on costs necessary for conducting the facility design safety review. “Necessary for” means that but for the facility design safety review, the costs would not have been incurred and that the costs cover only those activities and items without which the facility design safety review cannot be completed.

(a) Costs qualifying for cost recovery include, but are not limited to—

(1) Personnel costs based upon total cost to PHMSA;

(2) Travel, lodging and subsistence;

(3) Vehicle mileage;

(4) Other direct services, materials and supplies;

(5) Other direct costs as may be specified in the Master Agreement.

(b) [Reserved]

All PHMSA cost calculations for billing purposes are determined from the best available PHMSA records.

(a) PHMSA bills an applicant for cost recovery fees as specified in the Master Agreement, but the applicant will not be billed more frequently than quarterly.

(1) PHMSA will itemize cost recovery bills in sufficient detail to allow independent verification of calculations.

(2) [Reserved]

(b) PHMSA will monitor the applicant's account balance. Should the account balance fall below the required minimum balance specified in the Master Agreement, PHMSA may request at any time the applicant submit payment within 30 days to maintain the minimum balance.

(c) PHMSA will provide an updated estimate of costs to the applicant on or near October 1st of each calendar year.

(d) Payment of cost recovery fees is due within 30 days of issuance of a bill for the fees. If payment is not made within 30 days, PHMSA may charge an annual rate of interest (as set by the Department of Treasury's Statutory Debt Collection Authorities) on any outstanding debt, as specified in the Master Agreement.

(e) Payment of the cost recovery fee by the applicant does not obligate or prevent PHMSA from taking any particular action during safety inspections on the project.