The Pipeline and Hazardous Materials Safety Administration (PHMSA) oversees the safety of pipelines that transport natural gas or hazardous liquids and provides grants to states for programs to ensure pipeline safety. S. 2276 would require PHMSA to pursue a variety of regulatory and administrative activities related to such programs and would authorize appropriations for those purposes. The bill also would authorize PHMSA to establish safety standards for certain underground natural gas storage facilities, assess fees on entities that operate such facilities, and spend such fees—subject to authority provided in advance in appropriation acts—to ensure that such facilities meet those standards.
CBO estimates that implementing S. 2276 would require gross appropriations totaling $525 million over the 2017-2021 period. CBO also estimates that those appropriations would be offset by $462 million in fees paid by pipeline owners, which are considered offsets to discretionary spending. Assuming appropriation of amounts specified and estimated to be necessary, CBO estimates that the resulting net outlays would total $50 million over the 2017-2021 period.
In addition, CBO estimates that enacting S. 2276 would increase revenues from assessments on entities that operate certain underground natural gas storage facilities by $17 million over the 2017-2026 period. Pay-as-you-go procedures apply because enacting the legislation would affect revenues. Enacting S. 2276 would not affect direct spending.
CBO estimates that enacting the legislation would not increase net direct spending or on-budget deficits in any of the four consecutive 10-year periods beginning in 2027.
S. 2276 would impose intergovernmental and private-sector mandates as defined in the Unfunded Mandates Reform Act (UMRA) by establishing new safety standards on storage facilities for natural gas and imposing new fees. Based on information from PHMSA and industry sources, CBO estimates the aggregate cost of the mandates would fall below the annual thresholds established in UMRA for intergovernmental and private-sector mandates ($77 million and $154 million in 2016, respectively, adjusted annually for inflation).
