[00:00:00] Speaker 02:
Case number 20-1317 et al.

[00:00:04] Speaker 02:
Sierra Club et al petitioners versus United States Department of Transportation et al.

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Mr. Marshall for the environmental petitioners.

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Mr. Lusignan for the state petitioners.

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Mr. Ranchi for the petitioner POLF Tribe of Indians.

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Ms.

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Jaffee for the respondents.

[00:00:21] Speaker 08:
Good morning, Your Honors.

[00:00:22] Speaker 08:
May it please the court.

[00:00:23] Speaker 08:
Bradley Marshall on behalf of environmental petitioners.

[00:00:26] Speaker 08:
I'd like to reserve three minutes for rebuttal.

[00:00:29] Speaker 08:
This is a petition for review of a final rule approving the transportation of liquefied natural gas by rail.

[00:00:34] Speaker 08:
There are two main issues I'd like to address today that merit vacating the LNG by rail rule.

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First, the lack of opportunity for notice and comment on the new tank car design in the final LNG rule in violation of the Administrative Procedure Act.

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And second, the inadequate consideration of safety in the final LNG rule in violation of the Administrative Procedures Act and the Hazardous Materials Transportation Act.

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First, a lack of opportunity for public comment.

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Throughout the proposed LNG rule, PHMSA emphasized the opportunity to comment on possible operational controls, even though such controls were not proposed, but ultimately did make their way into the final rule.

[00:01:15] Speaker 08:
Environmental petitioners, of course, take no issue with that from a notice and comment perspective.

[00:01:21] Speaker 08:
At the same time, Finza specifically rejected the possibility of considering an alternative tank car design as requiring additional study.

[00:01:29] Speaker 07:
They required one particular form, but they have a whole section asking for information about tank car design and tank car specifications.

[00:01:39] Speaker 07:
They had two things they were clearly asking about.

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Subsection A, 3A is tank car specification and 3B is operational controls.

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So they were looking for both.

[00:01:52] Speaker 08:
With respect to your honor, if you look at that section, it specifically talks about the tank car design of the DOT 113C120.

[00:01:59] Speaker 07:
So it wasn't just an operational controls.

[00:02:01] Speaker 07:
They were asking about tank car specifications.

[00:02:04] Speaker 07:
They referenced that particular one.

[00:02:06] Speaker 07:
But the way you've argued it is that the only thing they wanted information on was operational controls, but the NPRM talks

[00:02:13] Speaker 07:
about both.

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People commented about both, including your clients.

[00:02:20] Speaker 07:
So to the extent you're arguing that we knew about operational controls, we didn't know the tank car specifications were on the table.

[00:02:27] Speaker 07:
It seems hard to reconcile with the text of the NPRM and the responses to it.

[00:02:33] Speaker 08:
We didn't know that possibly altering the tank car specifications were on the table.

[00:02:38] Speaker 08:
Throughout the proposed rulemaking, PHMSA emphasized the existing tank car and the existing operational and safety history of the existing tank car.

[00:02:47] Speaker 08:
At no point was there even any hint that they were considering modifying or proposing a new type of tank car design.

[00:02:53] Speaker 07:
DRM talks about tank car specifications.

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NTSB and others talked about all forms of tank car specifications, including

[00:03:01] Speaker 07:
thickness of the hull.

[00:03:03] Speaker 07:
And the agency responded to it.

[00:03:07] Speaker 07:
And so I'm having trouble understanding how there wasn't notice.

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They said, we want both these things.

[00:03:15] Speaker 08:
We want to consider the DOT 113, the suitability of the existing tank car.

[00:03:21] Speaker 08:
If you look at the proposed regulatory impact assessment, for example.

[00:03:24] Speaker 07:
Well, why isn't it if someone says, I want to know, tell me about the suitability of this car.

[00:03:30] Speaker 07:
And you go, not suitable.

[00:03:34] Speaker 07:
I've got to get 12 people in.

[00:03:36] Speaker 07:
I need a minivan.

[00:03:38] Speaker 07:
Right?

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That's a response.

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They say, tell me if this car is suitable.

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And you go, it's not.

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You need this.

[00:03:43] Speaker 07:
That's a common response, is it not?

[00:03:46] Speaker 08:
Well, it would be if they said as another option, here's the minivan, let us.

[00:03:51] Speaker 07:
Really, if I said to you, hey, I think for your family of 12, I think this compact car here would be great for you.

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Here's its fuel efficiency.

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What do you think?

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And you would say, that's not going to work for us.

[00:04:07] Speaker 08:
Right, Your Honor, and that's what we said.

[00:04:08] Speaker 07:
I wouldn't say that.

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You'd say, I need something bigger.

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would be the first thing you would say.

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I just don't understand why it seems illogical to think that they were tying everyone, they're muting everybody to even mention things that could make even this car or another car stronger.

[00:04:28] Speaker 07:
The tank car specifications means we want to talk about tank car specifications.

[00:04:33] Speaker 08:
That is not how they worded it.

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That is not how they invited comments.

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So even if it's a logical outlook because

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tank car design was on the table.

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Isn't it arbitrary and capricious to say that this solves all our problems?

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Let's just go to 9 16th of an inch thickness, and that's going to address the fireballs and the vapor clouds and all that stuff.

[00:04:57] Speaker 08:
Absolutely, Your Honor.

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And in addition to that, there's attendant higher weight issues that no one had the opportunity to comment on because this tank car that they've designed wasn't in anyone's imagination.

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And they didn't put it out there that imagine a new tank car for us and design what you think would be a safe tank car.

[00:05:13] Speaker 05:
But there were tank cars with 916th of an inch thickness because there's something in the record about a quarter of them still punctured upon derailment.

[00:05:24] Speaker 05:
Correct, Your Honor.

[00:05:24] Speaker 05:
So there were some of these 916s.

[00:05:26] Speaker 08:
Not of the double-haul DOT 113 that we're talking about.

[00:05:30] Speaker 08:
So you're talking about a different kind of tank car that did have the attendant higher thickness to show what would the outer shell, what could that look like?

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And so that is in the record.

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And yes, the core is still breached at a significantly lower speed.

[00:05:44] Speaker 05:
Was it still like a double-walled one?

[00:05:46] Speaker 08:
That was not a double-walled one.

[00:05:47] Speaker 05:
Oh, I see.

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So there is no data about whether that would puncture on a derail, the newly designed tank?

[00:05:55] Speaker 08:
Correct.

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There was no data.

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I mean, this is a new tank car that had never been designed before, never been created before.

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And there was no notice that they were thinking about creating a new tank car.

[00:06:05] Speaker 07:
In the proposed regulatory impact assessment, they were acting within the realm.

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I mean, the question is logical outgrowth or not, right?

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And they were dealing within the realm of tank car specifications, increasing hull thickness is on the table.

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That's an ordinary thing.

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It's not like they said, OK, let's try a flying car that doesn't exist, right?

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They said, here's something.

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that is routinely done to increase safety.

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And we're already going to have the double tank system here, which has safety protections.

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We're going to maximize it because there's lots of concerns.

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We hear you.

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about the safety issues and here's how we're going to respond to it.

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I mean, I'm just, I'm worried about the world in which, maybe this is, I set it up for you, whenever we write opinions like this, we have to worry about a world in which we create perverse incentives, you know, where the agency, if it listens to comments and changes something, gets charged with

[00:07:06] Speaker 07:
We hadn't thought about that.

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You changed something.

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The whole point of notice and comment is for the agency to learn and to respond to and react to and maybe incorporate some really well-made suggestions.

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And so was it out of the realm, would people not have thought to talk about whole thickness?

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And your own comments mentioned whole thickness.

[00:07:29] Speaker 08:
But no one suggested a new tanker design because they didn't realize it was within the realm of possibility to go back to the car analogy, right?

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You were presented with a car, you know, trying to, you know, fit 12 people in instead of we're not given a mini van, we're given a completely new car that no one's ever been imagined before.

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So how can people comment on that and actually have those thoughts thoughtfully considered?

[00:07:50] Speaker 07:
Increase in hole thickness is not something that hasn't happened before.

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That has happened before.

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It hasn't been in this particular format.

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Okay.

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But it's not like they were making up something new.

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Increasing hole thickness is a standardized way of increasing safety and reducing puncture risk.

[00:08:09] Speaker 07:
They said, okay, we will add that in.

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NTSB said you should do that.

[00:08:13] Speaker 07:
Okay, we will add that in.

[00:08:15] Speaker 07:
We'll call it, we'll give it a new number now, because it's different than the ones that don't have the increased thickness.

[00:08:21] Speaker 07:
But they weren't coming up with something that hadn't already been used.

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It's to protect, to reduce puncture risk.

[00:08:28] Speaker 08:
In this context, certainly the double haul of the DOT 113 tank car, it was new.

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It had not been done before.

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And it has.

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OK, we're going to have two protections.

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Here's two protections that already exist out there.

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Increased hull thickness and the double car.

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That existed and increased hull thickness existed.

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And they said, fine, we're going to do both.

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Belt and suspenders.

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That's not out of the realm of conception for someone to suggest, for people to comment on.

[00:08:59] Speaker 08:
But they didn't suggest to comment on it.

[00:09:01] Speaker 07:
Let me ask you a hypothetical.

[00:09:03] Speaker 07:
I'm sorry, for commenters to respond to.

[00:09:05] Speaker 05:
Along these lines, what if the agency had said, we're going to go to a triple layer?

[00:09:12] Speaker 05:
Would that be a logical outgrowth?

[00:09:13] Speaker 05:
Because they've already done a double outgrowth.

[00:09:15] Speaker 08:
I don't believe it would be.

[00:09:16] Speaker 08:
I don't believe it would be a logical outgrowth.

[00:09:18] Speaker 08:
Because any change in the physical

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In the physical tanker itself, we believe would not be a logical outgrowth given what they proposed.

[00:09:25] Speaker 07:
Any change?

[00:09:26] Speaker 08:
Any change based on what they said in the NPRM, how they were going to consider operational controls and that people should therefore comment on it.

[00:09:35] Speaker 05:
But I guess my I'm trying to get at at some point, even if it's along the same lines of what we've done before, if it's something so novel, does it cease to become a logical outgrowth?

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Like what if they said we're going to have half an inch thickness on the wall on the on the outer shell?

[00:09:54] Speaker 05:
Is that a logical outgrowth if that's never been done before?

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Nobody's ever imagined that happening.

[00:09:59] Speaker 05:
But if they said we're going to have a one-inch wall, we're going to have four layers instead of two.

[00:10:05] Speaker 05:
At some point, is it not a logical outgrowth, even if it's loosely based on something we've done before?

[00:10:10] Speaker 08:
Right.

[00:10:10] Speaker 08:
And especially if they invited comment on saying, we're going to consider modifications to the tank car, let us know what you think should be considered, we wouldn't be having this discussion about logical outgrowth.

[00:10:20] Speaker 08:
And the proposed regulatory impact assessment, they am- Is your test.

[00:10:23] Speaker 07:
In response to Judge Pan's question, what is your test for when a change in a proposal is so materially different as to violate the logical outgrowth?

[00:10:41] Speaker 07:
I heard you say a couple minutes ago, any change.

[00:10:44] Speaker 07:
Is that your position?

[00:10:46] Speaker 08:
Well, no, it's a change that commenters couldn't have divined that the agency was contemplating.

[00:10:51] Speaker 07:
What is your test for couldn't have divined?

[00:10:52] Speaker 07:
Because you know what?

[00:10:53] Speaker 07:
There were lots of comments in here about increasing whole thickness.

[00:10:57] Speaker 07:
So lots of commenters could define that was something they wanted to suggest, including your own clients.

[00:11:02] Speaker 07:
So let me try this again.

[00:11:04] Speaker 07:
So if we don't have that, so like I said, it's not the flying car.

[00:11:08] Speaker 07:
It's something completely out of people's conception.

[00:11:11] Speaker 07:
What is a legal test that we could write an opinion ruling for you that would say,

[00:11:16] Speaker 07:
Here's how we know that this was too novel, too far out of the realm of engineering capacities or common understandings of engineering options for tank car design to be on the table for anyone to know to comment about.

[00:11:35] Speaker 07:
What is the test?

[00:11:37] Speaker 08:
When you do it NPRM that says,

[00:11:40] Speaker 08:
This is the existing design we're relying on.

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And we are rejecting an alternative design.

[00:11:47] Speaker 08:
But we are going to invite comment on operational controls and consider them.

[00:11:51] Speaker 08:
And this is a deregulatory action that with no additional costs, however, we will consider operational controls.

[00:11:56] Speaker 08:
So please comment on that and those costs.

[00:11:59] Speaker 07:
In the NPRM, PIMSA and FRA must consider requirements for both the packaging, i.e.

[00:12:05] Speaker 07:
the real tank car and operational controls.

[00:12:07] Speaker 07:
That didn't put anybody on notice that they were considering both the tank car design and operational controls.

[00:12:13] Speaker 07:
That's not sufficient?

[00:12:14] Speaker 08:
No, especially when they specifically reject another tank car design.

[00:12:17] Speaker 07:
Another one, but they gave a reason for that.

[00:12:19] Speaker 07:
It was a different engineering reason.

[00:12:21] Speaker 04:
Yes.

[00:12:21] Speaker 04:
So why did your client and the other clients of the other two attorneys here

[00:12:28] Speaker 04:
Submit comments about the tankards.

[00:12:33] Speaker 08:
We challenge the adequacy of it and the safety history.

[00:12:36] Speaker 08:
I mean, this is a tankard that, you know, there's been 67 of them.

[00:12:40] Speaker 08:
Three of them were in a derailment.

[00:12:41] Speaker 04:
You challenged it and DOT responded by changing.

[00:12:46] Speaker 04:
Right, but they change in a way that... Isn't that the end of your argument?

[00:12:49] Speaker 08:
If they change it in a way that commenters could have predicted, I think that is the end of the argument.

[00:12:53] Speaker 08:
Our argument is that commenters couldn't have predicted that they were going to come up with a new tank car design when they didn't put that on the table.

[00:13:00] Speaker 07:
Even though you commented about hole thickness.

[00:13:02] Speaker 08:
Regarding the existing tank car, because that's what they said they were relying on.

[00:13:05] Speaker 07:
Its hole wasn't thick enough.

[00:13:07] Speaker 08:
Among other things, yes.

[00:13:09] Speaker 07:
OK, so you said this won't work, your hole's not thick enough, and we want to adopt a rule that says the agency can't say, good idea, good suggestion, we're going to increase it.

[00:13:19] Speaker 07:
That's the rule you want us to adopt?

[00:13:22] Speaker 08:
No.

[00:13:23] Speaker 07:
I think that's exactly what your position is.

[00:13:25] Speaker 08:
I think our position is that the agency invites comments on, and says we're open to having a new tank car, then we wouldn't be having this issue.

[00:13:36] Speaker 04:
We've been around the block on NEPA cases for decades.

[00:13:42] Speaker 04:
So if DOT did not respond to your comments and the comments of the tribe and the comments of the state, you'd be here saying that their NEPA, their assessment should be set aside because they didn't respond to comments.

[00:14:04] Speaker 04:
There's a nice little trap you have there.

[00:14:08] Speaker 08:
I respectfully would disagree with that, that they can respond to comments and say, we've considered what you said about the existing tankard design.

[00:14:16] Speaker 05:
It seems to me that you had an opportunity to comment on thicknesses of the outer wall or the inner wall, but what you didn't have an opportunity to comment on

[00:14:29] Speaker 05:
is the adequacy of a 9 16 inch outer wall.

[00:14:33] Speaker 08:
Correct.

[00:14:33] Speaker 05:
Your honor, nor did we have an opportunity to comment on the weight of it, but that to me, maybe it's not a logical outgrowth issue as much as an arbitrary and capricious argument that the agency adopted this outer wall, which you could have commented on.

[00:14:47] Speaker 05:
You could comment on thickness, but they took the next step of saying, and this addresses all of the safety concerns that have been raised here and nobody

[00:14:56] Speaker 05:
had an opportunity to comment on the adequacy of this new outer wall to address the safety concerns.

[00:15:02] Speaker 08:
Correct, Your Honor.

[00:15:02] Speaker 08:
There was never a look at, you know, what is... That's not the argument you've made here, though.

[00:15:05] Speaker 07:
You've made a logical outgrowth argument.

[00:15:07] Speaker 07:
But you made an arbitrary capricious argument.

[00:15:09] Speaker 08:
We've done both.

[00:15:11] Speaker 08:
Yeah.

[00:15:11] Speaker 08:
Yes.

[00:15:11] Speaker 08:
I mean, I think...

[00:15:13] Speaker 08:
There's two sides of it.

[00:15:14] Speaker 08:
One is logical outgrowth.

[00:15:15] Speaker 08:
The other is arbitrary capricious on the safety aspects.

[00:15:18] Speaker 08:
I mean, there's been no hint anywhere that these tank cars can survive a 50 mile per hour derailment.

[00:15:27] Speaker 07:
Anywhere?

[00:15:27] Speaker 07:
I mean, they did studies.

[00:15:29] Speaker 08:
And they all derail, and they all breach.

[00:15:31] Speaker 08:
I mean, they didn't.

[00:15:33] Speaker 05:
And they're not about these tank cars.

[00:15:34] Speaker 08:
I mean, not about these tank cars specifically, because these tank cars didn't exist.

[00:15:38] Speaker 08:
They're a new tank car design.

[00:15:40] Speaker 08:
So there couldn't be a study of how.

[00:15:41] Speaker 07:
Well, if ones that aren't as thick didn't puncture, then the additional thickness isn't going to increase the risk.

[00:15:48] Speaker 07:
Is there any argument that the additional thickness increases the risk of puncture?

[00:15:52] Speaker 08:
No, although I think there is an argument on the weight issue.

[00:15:54] Speaker 07:
I know, but they definitely dealt with the weight issue in their tests.

[00:15:57] Speaker 05:
But they did puncture.

[00:15:58] Speaker 05:
Everything punctured in all the tests, right?

[00:16:01] Speaker 00:
No.

[00:16:01] Speaker 05:
The best was a quarter, didn't.

[00:16:04] Speaker 05:
I think, correct me if I'm wrong, I thought the record was, with the 916th inch, that was single wall, but still, there was a quarter of them were punctured.

[00:16:14] Speaker 08:
Yes, 8 out of 32 punctured, and that was at 42 miles per hour in a flat field.

[00:16:20] Speaker 05:
So there's nothing in the record of something not puncturing at 916th of an inch.

[00:16:25] Speaker 08:
Correct, at 50 miles per hour.

[00:16:26] Speaker 08:
And it's almost, 42 to 50 miles per hour is almost 20% faster.

[00:16:30] Speaker 08:
And because energy is the square of speed, you're talking about almost 45% increase in energy if you're talking about 50 miles per hour, which only applies if there's, as a voluntary speed limit, if there's 20 or more LNG tank cars in a row, or 35 or more throughout the consist.

[00:16:48] Speaker 05:
So I had a question about this, because it just seemed to me, and correct me if I'm wrong, that this seems to be sort of an unprecedented amount of hazardous material that is being contemplated to be moved by rail.

[00:17:00] Speaker 05:
Because like the Eflina was two or three cars.

[00:17:03] Speaker 05:
Here there's like a permit for something like 80 cars.

[00:17:06] Speaker 05:
And then there's, I guess, a statement in your brief that 22 cars would be like a Hiroshima bomb if it ignited.

[00:17:15] Speaker 05:
Is it my perception is there hasn't been anything like this before where we're talking about 80 cars of liquid net LNG.

[00:17:24] Speaker 05:
I guess for Hiroshima bombs almost being transported together and then the risk of derailment you can't say that that's speculative or remote because derailments happen.

[00:17:35] Speaker 08:
Absolutely correct on all scores, Your Honor.

[00:17:38] Speaker 08:
That's absolutely right.

[00:17:39] Speaker 08:
This hasn't been done.

[00:17:39] Speaker 08:
Ethylene is the closest comparable cryogenic fossil fuel that's been transported.

[00:17:45] Speaker 08:
There's years with no WABLE data.

[00:17:47] Speaker 08:
It's one to three tank cars at a time.

[00:17:50] Speaker 08:
The entire existing fleet of DOT 113 tank cars, which encompasses of the C120Ws, which transport things other than ethylene too, was 67 at the time of the rulemaking.

[00:18:02] Speaker 05:
And there's no limit on the number of cars you can string together.

[00:18:05] Speaker 08:
Correct.

[00:18:08] Speaker 05:
That just seems extraordinary.

[00:18:10] Speaker 08:
It is and could have catastrophic consequences if there is a derailment and there is breach.

[00:18:15] Speaker 08:
And certainly at the speed we're talking about, there would be breach and possibly catastrophic consequences as a result.

[00:18:22] Speaker 07:
Can you just remind me, are you supposed to be doing the arbitrary and confused argument too?

[00:18:28] Speaker 07:
Or I can't remember the breakdown of who's doing it.

[00:18:30] Speaker 08:
On the HMCA and APA, yes, I'm also doing that.

[00:18:33] Speaker 08:
Although, I mean, the states join in that, and I'm sure they will also have things to say on that argument as well.

[00:18:41] Speaker 07:
Thank you very much.

[00:18:42] Speaker 08:
Thank you, Your Honors.

[00:18:42] Speaker 07:
Is everybody planning to do rebuttal too?

[00:18:45] Speaker 08:
I don't believe the states are planning to do rebuttal.

[00:18:47] Speaker 07:
OK, so you and the tribe will do rebuttal.

[00:18:51] Speaker 07:
Yes.

[00:18:52] Speaker 07:
Thank you.

[00:19:07] Speaker 01:
Good morning, Your Honors.

[00:19:07] Speaker 01:
May it please the court, Brian Lusignan with the New York State Office of the Attorney General representing 14 states and the District of Columbia.

[00:19:15] Speaker 01:
I plan to focus my argument on why PIMSA's analysis of the safety risks posed by transporting LNG by rail violated NEPA, although I think these issues are also relevant to the HMTA violations.

[00:19:30] Speaker 01:
First, PIMSA was required to prepare an environmental impact statement because transporting LNG by rail presents unique safety risks that are highly uncertain, highly controversial, and potentially catastrophic.

[00:19:44] Speaker 01:
And second, the environmental assessment PIMSA did prepare is arbitrary and capricious because the agency failed to grapple with the central safety issue of what will happen to 50 to 100 tank cars filled with LNG in derailment conditions.

[00:19:57] Speaker 01:
When PIMSA suspended the rule, it candidly acknowledged the many uncertainties underlying the rule, but failed to take the logical next step of repealing the rule in full.

[00:20:08] Speaker 01:
This court should vacate the rule so that it does not spring back into effect in July of 2025, and so PIMSA can write on a blank slate when it proposes a replacement regulation.

[00:20:18] Speaker 01:
With respect to the requirement for an environmental impact statement, this rule poses unique safety risks that are highly uncertain and highly controversial and implicate at least three of the intensity factors that require an EIS.

[00:20:34] Speaker 01:
Implicating any one of these factors is maybe sufficient.

[00:20:37] Speaker 04:
Where do these factors come from?

[00:20:39] Speaker 01:
The Council for Environmental Quality has regulations defining when... Where does the Council on Environmental Quality get the authority to issue binding regulations?

[00:20:53] Speaker 01:
I'm not sure the answer to that question, Your Honor.

[00:20:55] Speaker 04:
These are the regulations... Do you know that there's at least four opinions of our court, maybe more, that question whether CEQ has any regulatory authority?

[00:21:07] Speaker 04:
Because the statute, the NEPA statute doesn't give it to them.

[00:21:11] Speaker 04:
It was Jimmy Carter in an executive order did it.

[00:21:14] Speaker 04:
And the question is whether that violates the separation of powers.

[00:21:19] Speaker 04:
Are you familiar with those cases?

[00:21:21] Speaker 01:
I'm not familiar with those cases, Your Honor.

[00:21:22] Speaker 01:
I apologize.

[00:21:23] Speaker 01:
I do know this court in the Standing Rock Sioux Tribe.

[00:21:26] Speaker 04:
Does that argument depend on the CEQ regulations?

[00:21:29] Speaker 01:
No, Your Honor.

[00:21:29] Speaker 01:
You can go back to the statute if you want.

[00:21:31] Speaker 01:
It requires an environmental.

[00:21:33] Speaker 01:
Factors, there's not 10 factors in the statute.

[00:21:36] Speaker 01:
The NEPA requires an environmental impact statement for major federal actions that may have a significant environmental impact.

[00:21:45] Speaker 04:
That's significantly, right?

[00:21:47] Speaker 01:
Significantly, and the CEQ regulations define significantly.

[00:21:53] Speaker 01:
And even if you just want to look at the statute, I think

[00:22:00] Speaker 01:
Transporting LNG in these tank cars 50 to 100 together poses a significant risk of danger.

[00:22:14] Speaker 01:
HIMSA itself has acknowledged many times the dangers posed by transporting LNG by rail.

[00:22:22] Speaker 01:
In the rule, it recognized that release and ignition of an LNG vapor cloud poses a, quote, serious threat, end quote, to people nearby.

[00:22:31] Speaker 05:
So this could be framed as violating the statute and the case law that says the agency has to take a hard look at the problem.

[00:22:40] Speaker 05:
Correct, Your Honor.

[00:22:41] Speaker 05:
So we could just not rely on the CEQ

[00:22:43] Speaker 05:
regulations and decide it based on the statute and the case law if need be?

[00:22:47] Speaker 01:
That's correct, Your Honor, and can look at both the significance of a release event, an event where there's a derailment and LNG is released into the environment, and the fact that the possibility of that is not remote and speculative.

[00:23:05] Speaker 01:
PIMSA concedes that you cannot eliminate entirely the risk of derailments.

[00:23:11] Speaker 04:
What is a hard look?

[00:23:13] Speaker 01:
A hard look requires that the agency recognize, acknowledge the environmental impacts that its actions will have and fully evaluate them.

[00:23:29] Speaker 01:
It's more than a quick glance.

[00:23:31] Speaker 01:
It's looking at the problem and explaining whether that problem is significant or not significant.

[00:23:40] Speaker 01:
That's what you do with the environmental

[00:23:42] Speaker 01:
That's what's done in every NEPA case, yeah.

[00:23:46] Speaker 01:
Well, not in every NEPA case, because typically for a major nationwide regulation like this, the agency would do a full environmental impact statement.

[00:23:56] Speaker 01:
Here, PIMSA didn't even do that.

[00:23:58] Speaker 01:
They just did an environmental assessment, which is what the agency is supposed to do to determine whether any IES is required.

[00:24:06] Speaker 05:
Doesn't our case law say something similar to what the CEQ regulations require?

[00:24:11] Speaker 05:
Because it does say, I'm looking at Myersville citizens versus FERC, it has to show that

[00:24:19] Speaker 05:
If there's an impact of true significance, an EIS is unnecessary because changes or safeguards in the project significantly reduce the impact to a minimum.

[00:24:30] Speaker 05:
So that sounds very similar to if there's a grave risk, it has to be remote or speculative.

[00:24:36] Speaker 05:
It's similar, although not exactly the same.

[00:24:41] Speaker 05:
And so I guess the bottom line of your argument is this is a potentially

[00:24:45] Speaker 05:
catastrophic event with dire doomsday consequences and they didn't adequately justify

[00:24:54] Speaker 05:
that it's not significant because it's just so unlikely to happen that we don't need a PIS?

[00:25:00] Speaker 01:
That's correct, Your Honor.

[00:25:01] Speaker 01:
And I think another relevant case from this court is the New York v. NRC case, where the court said that NRC couldn't just ignore the possibility that spent nuclear waste will remain on site indefinitely based on its conclusory statement that there'll be a permanent solution when necessary.

[00:25:24] Speaker 07:
Has DOT disputed the applicability of the CEQ regulatory significance factors in this case, or did they accept them?

[00:25:33] Speaker 01:
DOJ has accepted the use of the CEQ regulations in this case.

[00:25:42] Speaker 01:
No parties argue that they wouldn't apply.

[00:25:44] Speaker 07:
That's correct, Your Honor.

[00:25:47] Speaker 04:
Under the regulations, they're not allowed to paraphrase or repeat CEQ regulations.

[00:25:54] Speaker 04:
All they can do is supplement them for the purpose of the particular agency involved.

[00:26:00] Speaker 04:
And the CEQ regulations say that, do not paraphrase, do not repeat.

[00:26:09] Speaker 01:
That may well be, Your Honor.

[00:26:10] Speaker 01:
It may well, that is true.

[00:26:14] Speaker 01:
OK, very well then, Your Honor.

[00:26:15] Speaker 01:
I accept that.

[00:26:17] Speaker 01:
And again, I don't think you need to go to those CEQ regulations if Your Honors have concerns with them.

[00:26:22] Speaker 01:
I think the statute itself and this court's precedence interpreting statute required an EIS.

[00:26:29] Speaker 04:
Yeah, by the way, DOT never published any regulations dealing with NEPA.

[00:26:39] Speaker 04:
The only thing it did was, I think, in 1979, issued an order

[00:26:45] Speaker 04:
But it's never been published in the code of federal regulations.

[00:26:50] Speaker 01:
Well, unquestionably, DOT remains subject to the NEPA statute, which requires an environmental impact statement for major federal actions that may have a significant impact on the environment.

[00:27:02] Speaker 01:
And this is also a case where a wide range of commenters with specific expertise and knowledge about safety issues urged PIMSA to do more analysis of the safety risk posed by transporting LNG by rail.

[00:27:20] Speaker 01:
These commenters included the National Transportation and Safety Board,

[00:27:23] Speaker 01:
various state safety agencies, organizations representing first responders, the Puyallup tribe, all urged PIMSA to wait until the crashworthiness of these tank cars could be fully evaluated for finalizing the rule.

[00:27:43] Speaker 04:
What is the harm that your clients allege

[00:27:48] Speaker 01:
for standing purposes.

[00:27:51] Speaker 01:
Yes, Your Honor.

[00:27:51] Speaker 01:
We've alleged three forms of harm for standing purposes.

[00:27:55] Speaker 01:
Probably the easiest to wrap to discuss is the proprietary injury to our financial resources as we have to prepare for the transportation of LNG by rail through our states.

[00:28:08] Speaker 01:
There was a special permit issued to a transporter

[00:28:11] Speaker 01:
specifically to transport LNG from Pennsylvania to New Jersey.

[00:28:15] Speaker 01:
Both of those states are in our coalition.

[00:28:18] Speaker 01:
There's also the record is replete with references to the need to transport natural gas from Pennsylvania and other Midwestern states to New England.

[00:28:28] Speaker 01:
All the overland routes for that would pass through New York state.

[00:28:31] Speaker 04:
One of the requirements is that the harm be imminent, right?

[00:28:36] Speaker 04:
Correct, Your Honor.

[00:28:37] Speaker 04:
And there was the government

[00:28:40] Speaker 04:
comes back and says, number one, this regulation is not going into effect until next June.

[00:28:46] Speaker 04:
If it ever goes into effect, it might be suspended or replaced.

[00:28:49] Speaker 04:
And number two, it would take five years

[00:28:53] Speaker 04:
to build up a fleet of tank cars sufficient to transport the LNG.

[00:29:02] Speaker 04:
So if you add that together, it's about five and three quarters years before anything gets rolled down the tracks.

[00:29:10] Speaker 04:
Why is that imminent harm?

[00:29:12] Speaker 01:
Your honor, I would disagree with that timeline.

[00:29:15] Speaker 01:
The suspension rule will expire on its own terms in July 2025, unless PIMSA issues a replacement.

[00:29:24] Speaker 01:
PIMSA has, excuse me, unless PIMSA finalizes a replacement rule, PIMSA has not yet even proposed a replacement rule.

[00:29:31] Speaker 01:
So it's almost certain to expire in July of 2025.

[00:29:34] Speaker 01:
Additionally, PIMSA acknowledges that these W-9 tank cars are currently being built, albeit they're being built to transport ethylene.

[00:29:43] Speaker 01:
But if you read our declaration from Jim Cable, our standing declaration,

[00:29:50] Speaker 01:
Those tank cars can be converted to transport LNG in a matter of months.

[00:29:54] Speaker 04:
So if this rule... It can be converted, but then you need the equipment that does the freezing, right?

[00:30:02] Speaker 04:
You need to construct that.

[00:30:05] Speaker 01:
You would need a liquefaction facility.

[00:30:07] Speaker 01:
I'm not familiar with the technicalities of how those are constructed.

[00:30:12] Speaker 01:
PIMSA recognizes there's at least one of them currently capable of loading LNG into tank cars.

[00:30:20] Speaker 05:
There are already permits.

[00:30:21] Speaker 05:
I thought one was

[00:30:22] Speaker 05:
Oh, yeah.

[00:30:23] Speaker 05:
Yeah.

[00:30:23] Speaker 01:
Yes, there was a special permit issued for.

[00:30:26] Speaker 01:
Oh, so there are a couple of different permits related here.

[00:30:29] Speaker 01:
There's there was a special permit to transport LNG in these 113 C 120 W tank cars issued to a company transporting it from Pennsylvania to New Jersey.

[00:30:41] Speaker 01:
There are also two permits for transport of LNG in

[00:30:47] Speaker 01:
these portable tanks that you can put on a flatbed rail car, one in Alaska and one in Florida.

[00:30:55] Speaker 01:
So that's a slightly different issue.

[00:30:57] Speaker 05:
But that assumes liquefaction can occur.

[00:30:59] Speaker 01:
Right, exactly.

[00:31:00] Speaker 01:
They are capable of filling these tanks with LNG at this point.

[00:31:06] Speaker 01:
I see that amount of time.

[00:31:07] Speaker 01:
Unless your honors have further questions, I'll rest on our briefs for the remaining issues.

[00:31:11] Speaker 01:
Thank you.

[00:31:28] Speaker 03:
Good morning, Your Honors.

[00:31:29] Speaker 03:
Aaron Rentsch for the Puyallup Tribe of Indians.

[00:31:33] Speaker 03:
The Puyallup Tribe became involved in this litigation for the main reason being that it only has one reservation, and it's not going to be getting another one.

[00:31:46] Speaker 03:
Protecting its homeland is of paramount importance to the tribe, and the tribe has grave concerns about the implications of this rule.

[00:31:54] Speaker 03:
the tribe notified the agency about those concerns and the agency treated those concerns like a check the box exercise.

[00:32:05] Speaker 05:
Could you address the tribe standing?

[00:32:08] Speaker 05:
Because it seems to me, and correct me if I'm wrong, that you're relying on the theory that LNG will be transported by rail from the Tacoma LNG facility.

[00:32:18] Speaker 05:
But it doesn't seem like there are any plans to do that.

[00:32:21] Speaker 05:
It doesn't seem to be any

[00:32:24] Speaker 05:
connecting the rail spur there to a railroad track.

[00:32:28] Speaker 03:
So first of all, I would say that we're not relying on that in terms of standing.

[00:32:34] Speaker 03:
I think that that is obviously significant for the disparate impact analysis that we raised in our briefing.

[00:32:41] Speaker 03:
But in terms of standing, this rule does not have any restrictions on where these trains with their unlimited numbers of cars full of LNG can go.

[00:32:51] Speaker 05:
I'm sorry, don't they have to go near

[00:32:55] Speaker 05:
the tribe's land in order for the tribe to have standing.

[00:32:58] Speaker 05:
Otherwise, they're not affected.

[00:33:00] Speaker 03:
Yeah.

[00:33:00] Speaker 03:
And nothing in this rule would prevent these trains from going through there.

[00:33:03] Speaker 03:
I think it's through the tribe's land.

[00:33:06] Speaker 03:
Nothing in the rule restricts where the trains can go.

[00:33:09] Speaker 03:
Now, understand the risk of them going through the land is much greater if it's being transported from Tacoma LNG.

[00:33:15] Speaker 03:
And there's certainly evidence.

[00:33:17] Speaker 05:
But then anybody would have standing that's near a railroad track in that theory, right?

[00:33:22] Speaker 05:
If your theory is nothing would stop a train from using railroad tracks near us, then every party or entity that's near a railroad track would have standing.

[00:33:33] Speaker 05:
That can't be right, can it?

[00:33:34] Speaker 03:
I think it could be, because if the standard is, well, you have to show that this harm is, and I know Judge Randolph used the word imminent, but I think that word has to be relative.

[00:33:49] Speaker 03:
There's no time limit or restriction on this rule.

[00:33:53] Speaker 03:
The AAR, when it requested this rule, specifically said, this rule is likely to, if approved, is likely to

[00:34:00] Speaker 03:
increase the interest in transportation of LNG by rail.

[00:34:04] Speaker 04:
That's not my word.

[00:34:07] Speaker 04:
No, I understand.

[00:34:09] Speaker 03:
Every recitation of what standing requires for the last 40 years is... I certainly agree, but I'm just saying that we need to understand what the word imminent means because we have a 30-day deadline or maybe it was 60 days to file a challenge to this rule.

[00:34:26] Speaker 03:
And if the standard is, if the definition of imminent is

[00:34:30] Speaker 03:
it's going to take several years to get these fleets prepared and going, and therefore it's not imminent, then nobody has standing to challenge the rule within 60 days?

[00:34:41] Speaker 07:
I've just dealt with that recent problem recently.

[00:34:44] Speaker 07:
I just took care of that problem recently.

[00:34:47] Speaker 07:
If you're not affected at the time, but you're affected later, you can challenge later.

[00:34:49] Speaker 05:
And also my issue is the geographic nexus.

[00:34:54] Speaker 05:
I think there has to be some geographic nexus for this type of harm, doesn't there?

[00:34:59] Speaker 03:
Yeah, I mean, right.

[00:35:02] Speaker 03:
And so, I mean, we have the Tacoma LNG.

[00:35:06] Speaker 03:
If we want to talk about the Tacoma LNG facility, certainly we put evidence in the record that the owners of the Tacoma LNG facility have promoted their access to the rail lines, the rail spur that is at the site, as a competitive advantage.

[00:35:24] Speaker 03:
which clearly says that this is an anticipated end use of this facility.

[00:35:28] Speaker 04:
The LNG facility near the Tribal's reservation boundaries, there is one, is that correct?

[00:35:37] Speaker 03:
Yeah, it is on the reservation boundary.

[00:35:39] Speaker 04:
Is that used for trucking?

[00:35:42] Speaker 04:
Is it operational?

[00:35:43] Speaker 03:
It isn't operational.

[00:35:44] Speaker 03:
And so it's used for trucking.

[00:35:46] Speaker 03:
It does, I believe it ships.

[00:35:48] Speaker 04:
Not ships.

[00:35:49] Speaker 03:
It is ships.

[00:35:52] Speaker 03:
Its primary use is to fuel ships, Your Honor.

[00:35:55] Speaker 03:
But it also... From trucks?

[00:35:58] Speaker 03:
No, no, no.

[00:35:59] Speaker 03:
It's by a pipeline that goes from the facility to the docks.

[00:36:04] Speaker 03:
It's in the Port of Tacoma.

[00:36:05] Speaker 07:
Now you also have a consultation claim.

[00:36:07] Speaker 07:
We do indeed have a consultation claim.

[00:36:11] Speaker 07:
You assert statutory and regulatory executive order rights to

[00:36:16] Speaker 07:
consultation that procedure injury.

[00:36:19] Speaker 07:
And you're saying it didn't happen.

[00:36:20] Speaker 07:
That's the issue in the case.

[00:36:22] Speaker 07:
But that is a distinct injury as well.

[00:36:26] Speaker 03:
Well, yes.

[00:36:27] Speaker 03:
I would agree that it's similar to the Eagle County case that this court cited in terms of the potential harms at the time, the risks of derailments and safety risks that this court found sufficient to support standing in that case.

[00:36:46] Speaker 03:
and the procedural harm being the failure to consult with the tribe about this, as well as the failure to conduct a proper environmental justice analysis, which is also a procedural harm.

[00:37:00] Speaker 03:
The consultation claim, the National Historic Preservation Act requires the agency to impose an affirmative obligation on all federal agencies

[00:37:14] Speaker 03:
consult with any Indian tribe that attaches cultural or religious significance to property that may be affected by a federal undertaking.

[00:37:21] Speaker 03:
PHMSA has not disputed that.

[00:37:24] Speaker 04:
I have not looked at that statute in years.

[00:37:28] Speaker 04:
I know at one point it was considered not judicially enforceable.

[00:37:32] Speaker 03:
Is it?

[00:37:34] Speaker 03:
I'm not aware of that.

[00:37:36] Speaker 03:
We've had cases, you know, including from this court just recently.

[00:37:40] Speaker 03:
I think United Quito was in 2019 that applied the Section 106 of the NHPA.

[00:37:50] Speaker 03:
In any event, PHMSA has not disputed that the rule at issue was a federal undertaking.

[00:37:54] Speaker 03:
and PHMSA did not comply with its obligation to consult.

[00:37:57] Speaker 07:
How does it's repeated outreach to the tribe?

[00:38:00] Speaker 07:
Emails, phone calls, emails, phone calls.

[00:38:04] Speaker 07:
What is your best case for that that was not sufficient effort to consult?

[00:38:08] Speaker 03:
Well, I mean, the question is whether a handful of emails and phone calls over a period of a few weeks, what's our case for that being insufficient?

[00:38:17] Speaker 07:
What is the best case that that is not sufficient outreach to the tribe?

[00:38:22] Speaker 03:
Every single consultation case cited by any of the parties, whether it held consultation adequate or inadequate,

[00:38:30] Speaker 07:
involved much much more than that doesn't answer my question as to what is the baseline that the statute requires there may be others where there were more activities but here they had the meeting and i understand your explanation that meeting was kind of short but then after that there were repeated

[00:38:49] Speaker 07:
emails, many unanswered by the tribe, phone calls, efforts to schedule meetings.

[00:38:55] Speaker 07:
And I don't know what is the legal rule that says that's not sufficient efforts to consult.

[00:39:02] Speaker 03:
So first of all, about the meeting, I'll just say it's not just our position that it was cut short.

[00:39:07] Speaker 03:
It's PHMSA's position that it was focused on other topics.

[00:39:10] Speaker 03:
I understand.

[00:39:10] Speaker 07:
I'm trying to skip over that for the sake of time here, because you wanted to save some time for rebuttal.

[00:39:14] Speaker 03:
So I'm trying to give you some time here.

[00:39:18] Speaker 03:
From the regulations and the case law, our view is that there are four characteristics of a meaningful consultation.

[00:39:25] Speaker 03:
Those characteristics would be a robust exchange of information and views.

[00:39:29] Speaker 07:
They can't do it if you're not answering the emails and the phone calls.

[00:39:32] Speaker 07:
They were trying to schedule it.

[00:39:34] Speaker 07:
You can't complain about the lack of robust exchange if you didn't respond to their efforts to schedule a meeting.

[00:39:40] Speaker 03:
Right, but the meeting they were trying to schedule was not consultation.

[00:39:44] Speaker 03:
That what they were trying to schedule was a meeting on very short notice with an agent.

[00:39:49] Speaker 07:
You didn't have a whole lot of time left.

[00:39:52] Speaker 07:
I mean, you yourselves have said there wasn't a whole lot of time left, and the tribe didn't.

[00:39:56] Speaker 07:
In their NBRM, they said, we don't think this implicates a need for tribal consultation.

[00:40:01] Speaker 07:
That's public.

[00:40:03] Speaker 07:
Tribes were on notice if they disagreed to weigh in sooner.

[00:40:06] Speaker 07:
But they provided notice to tribes that they didn't think consultation was required.

[00:40:10] Speaker 07:
And it wasn't until very late in the game that the tribe said, we think consultation is required, at least for us, given our situation.

[00:40:18] Speaker 03:
Okay, so let's start with the timing aspect of it, because the NHPA regulations specifically say that tribal consultation needs to occur early in the planning process.

[00:40:27] Speaker 07:
Yes, they gave notice early on that they weren't aware of a need for it.

[00:40:32] Speaker 07:
They can't do tribal consultation if they've made a determination that they aren't aware of a need for it.

[00:40:37] Speaker 07:
But that was public notice.

[00:40:39] Speaker 03:
They also can't throw out their statutory obligation to comply, to consult by simply saying, we don't think there's a need for us to comply with no analysis in the rule of how they knew, how would they have known otherwise?

[00:40:53] Speaker 07:
Well, you know, I mean, I think every single thing, every agency does, they're going to have to call every single Indian tribe in this country and say, would you like to consult?

[00:41:05] Speaker 03:
I don't know that they need to call.

[00:41:06] Speaker 03:
This could certainly send a form letter, you know, if that's the concern.

[00:41:10] Speaker 07:
I'm not aware of any case law that says the NPRM itself, Public Notice Federal Register, isn't sufficient.

[00:41:17] Speaker 03:
I mean, there's a case law saying that not beginning consultation until after the notice of proposed rulemaking is insufficient.

[00:41:27] Speaker 07:
If you know that it's going to have implications.

[00:41:29] Speaker 07:
I'm dealing with a situation where the agency

[00:41:33] Speaker 07:
didn't, had come to the recent conclusion that it wasn't gonna have implications.

[00:41:37] Speaker 07:
Maybe they weren't aware of the particular geography of your trial.

[00:41:40] Speaker 03:
So I get the court's point.

[00:41:43] Speaker 03:
And so the question is, okay, they're sending these emails.

[00:41:47] Speaker 03:
All right.

[00:41:48] Speaker 03:
Every single case that has addressed this issue has involved consultation that took years, not a few weeks.

[00:41:57] Speaker 03:
All those cases involved formal letters

[00:42:01] Speaker 03:
from the agencies to the tribes initiating consultation.

[00:42:05] Speaker 07:
This time they did it in emails.

[00:42:06] Speaker 07:
I don't know how I write an opinion that says repeated emails that are not answered by the tribe are insufficient.

[00:42:18] Speaker 03:
Repeated emails offering something that is not sufficient consultation would certainly be insufficient.

[00:42:25] Speaker 07:
In the best case, meeting with the general counsel is not sufficient consultation.

[00:42:31] Speaker 07:
I'm trying to get a framework here.

[00:42:33] Speaker 07:
I understand the facts of what you're arguing.

[00:42:35] Speaker 07:
I'm trying to get a legal framework that says that their efforts repeatedly to have you meet the general counsel who is part of the leadership

[00:42:44] Speaker 07:
were as a matter of law insufficient consultation.

[00:42:47] Speaker 03:
Okay.

[00:42:47] Speaker 03:
Well, I mean, there's there's a case.

[00:42:50] Speaker 03:
There's also the the Kachon Tribe case from the Southern District of California held that the main thing what's wrong there in two and a half years of meetings and letters.

[00:42:59] Speaker 03:
Kachon Tribe.

[00:43:00] Speaker 07:
Okay, so the fact that there was a case where there's two and a half years of meeting doesn't answer my question.

[00:43:04] Speaker 03:
Which said the main thing that that case said was the error was the failure to offer the field managers in charge of the case, in charge of the project as a consulting partner.

[00:43:17] Speaker 07:
Okay, well here you have the general counsel part of the senior leadership.

[00:43:21] Speaker 03:
Right.

[00:43:23] Speaker 03:
But I mean, in that case, there were people that were offered who were part of the leadership.

[00:43:28] Speaker 03:
It wasn't the decision makers here.

[00:43:30] Speaker 03:
The issue is our position is for government to government consultation to to be meaningful.

[00:43:38] Speaker 03:
It's inherent in that concept that it's it's with a decision maker.

[00:43:42] Speaker 07:
Okay.

[00:43:44] Speaker 07:
Is there any president from our court defining decision-maker as you would have it?

[00:43:50] Speaker 07:
I don't know who you want.

[00:43:51] Speaker 07:
I don't even know for your brief who you think that decision-maker should be.

[00:43:53] Speaker 07:
Were you supposed to meet with the head of PHMSA?

[00:43:57] Speaker 03:
Well, I think it would be up to PHMSA to identify who that person was.

[00:44:00] Speaker 07:
They did, they identified the general counsel.

[00:44:02] Speaker 03:
No, I don't think that, they never ever claimed that that was somebody with decision-making.

[00:44:07] Speaker 03:
They said that there was part of it.

[00:44:09] Speaker 03:
They said it was the agency lawyer.

[00:44:11] Speaker 07:
You don't have.

[00:44:12] Speaker 07:
You don't have any idea who you wanted to meet with either.

[00:44:14] Speaker 03:
I think I think the head of things that would be appropriate, but certainly if I thought that there was somebody with the best case that it has to be the head of the agency.

[00:44:24] Speaker 03:
So again, I was a Southern District of California.

[00:44:27] Speaker 03:
Yeah.

[00:44:28] Speaker 03:
Yes, I recognize it's a case from the Southern District.

[00:44:31] Speaker 03:
We don't have a case from this court.

[00:44:32] Speaker 03:
We do have cases from this court saying that there is very little precedent about what meaningful consultation is.

[00:44:40] Speaker 07:
But I'm more satisfied because you want to save some time for a battle and you're already over.

[00:44:45] Speaker 07:
Go ahead and finish that thought.

[00:44:46] Speaker 03:
Right.

[00:44:47] Speaker 03:
So the point I want to make is we do have authority from this case, from this court, acknowledging that

[00:44:53] Speaker 03:
once the substantive decision has been made, that is too late for meaningful consultation to occur.

[00:44:59] Speaker 03:
And in the email exchanges that we're talking about, the agency admits they are already working to finalize the final.

[00:45:05] Speaker 07:
I understand, but we have precedent from this court that says it's not over, essentially, until the fat lady sings on the Federal Register.

[00:45:10] Speaker 03:
No, it doesn't say that.

[00:45:12] Speaker 03:
That would be incorrect, because the court is talking about the Eighth Circuit case of Oglala Sioux, where it was not a final order issued.

[00:45:20] Speaker 03:
It said that the substantive decision had been made.

[00:45:23] Speaker 03:
The order, the final order was issued after the consultation occurred.

[00:45:28] Speaker 07:
But if there were precedent from this court saying as long as it happens before the final rule, then that would bind this panel.

[00:45:39] Speaker 03:
I would assume that this court would be required to follow other students of this panel.

[00:45:43] Speaker 07:
Yes, Your Honor.

[00:45:45] Speaker 07:
Thank you.

[00:45:46] Speaker 07:
Any other questions?

[00:45:47] Speaker 07:
Thank you, Counselor.

[00:45:51] Speaker 07:
All right.

[00:45:53] Speaker 07:
This one here from Pimson now.

[00:46:09] Speaker 06:
May it please the court.

[00:46:10] Speaker 06:
Rebecca Jaffe appearing on behalf of the United States.

[00:46:14] Speaker 06:
With me at council table are Charlie Enlow and Sean Ford from the Department of Transportation.

[00:46:22] Speaker 06:
In promulgating the rule, PHMSA acted reasonably under the APA's arbitrary and capricious standard and applied its expertise in hazardous materials transportation.

[00:46:31] Speaker 06:
The rule rested on top of the existing hazardous materials regulations, a robust set of regulations governing all aspects of hazardous materials transportation.

[00:46:41] Speaker 06:
And then for LNG specifically, PHMSA added a number of requirements, an enhanced outer tank, enhanced braking systems,

[00:46:50] Speaker 06:
remote location and pressure monitoring, safety and security route planning, among other things.

[00:46:58] Speaker 06:
PHMSA reasonably concluded that these additional requirements plus the existing hazardous materials regulations would ensure the safe transportation of LNG by rail and prevent any significant impacts.

[00:47:10] Speaker 05:
How does PHMSA know that this is sufficient?

[00:47:13] Speaker 05:
Because it just seems that this is sort of an unprecedented

[00:47:17] Speaker 05:
amount of hazardous material with exceptional inflammatory properties, it just the doomsday scenarios are quite dire when we're talking about LNG that can

[00:47:32] Speaker 05:
result in a boiling liquid expanding vapor explosion that can leak and then ignite.

[00:47:38] Speaker 05:
And there's no limit on the number of rail cars you can string together full of LNG.

[00:47:45] Speaker 05:
I guess they made the argument that 22 rail cars is the equivalent of a Hiroshima bomb.

[00:47:53] Speaker 05:
I just find this extraordinary, the risk being so high, and that you think just

[00:47:59] Speaker 05:
increasing the thickness of the outer wall would be sufficient to address that risk.

[00:48:04] Speaker 05:
How do you know that and what's your basis for saying so?

[00:48:07] Speaker 06:
A couple points, Your Honor.

[00:48:09] Speaker 06:
First of all, the hazardous materials regulations, PHMSA and its history, has never limited the quantity of hazardous materials that can be transported in a particular train.

[00:48:19] Speaker 06:
And there are other

[00:48:20] Speaker 06:
flammable hazardous.

[00:48:21] Speaker 05:
There's a permit that asks to string, I guess, 80 of these together.

[00:48:25] Speaker 05:
It's a lot of trains.

[00:48:28] Speaker 05:
That's almost for Hiroshima bombs.

[00:48:30] Speaker 06:
Your honor, I can't speak to the accuracy of the Hiroshima bomb analogy, but I can say that PHMSA in 2015, for example, promulgated a rule addressing what it calls high hazardous flammable trains.

[00:48:43] Speaker 06:
So that's large shipments of crude oil and ethanol.

[00:48:46] Speaker 06:
those shipments often have 70, 80, 100, 100 plus cars in the train.

[00:48:53] Speaker 06:
PHMSA has never limited the quantity of hazardous materials that can be on a particular train.

[00:48:58] Speaker 05:
No, I understand.

[00:48:59] Speaker 05:
I just think this seems to be unprecedented in what the doomsday scenario would be because derailments are not remote or speculative.

[00:49:08] Speaker 05:
And it just seems that there's this risk of cascading consequences if you've got a whole bunch of these together and one ignites and they all ignite and say it's near a

[00:49:17] Speaker 05:
city or a populous region, it just seems extraordinarily dangerous.

[00:49:23] Speaker 06:
Your honor, I beg to differ.

[00:49:24] Speaker 06:
PHMSA put a number of safety measures into the rule.

[00:49:28] Speaker 06:
There's the enhanced thickness of the outer tank.

[00:49:32] Speaker 05:
I understand that.

[00:49:32] Speaker 05:
I'm just wondering why that's adequate and why is it not arbitrary and capricious that you decided that was adequate when there's been no testing?

[00:49:41] Speaker 06:
Well, to the first point, I would just say that's not the only measure in the rule.

[00:49:45] Speaker 06:
But to the second point, PHMSA... The other measures are even less convincing.

[00:49:50] Speaker 05:
But go ahead.

[00:49:52] Speaker 06:
I think it's the measures combined together that PHMSA, the basis for PHMSA's determination.

[00:50:00] Speaker 06:
But PHMSA did rely on modeling done for that 2015 regulation that I mentioned that showed the risks of

[00:50:08] Speaker 06:
breaches and punctures were much lower with nine sixteenths of an inch thick tank shells.

[00:50:14] Speaker 06:
It also looked at real world derailment data that showed comparing three derailments where two of the derailments involved cars that are seven sixteenths of an inch thick.

[00:50:26] Speaker 06:
And then one derailment had cars that were nine sixteenths of an inch thick.

[00:50:30] Speaker 06:
And those cars did much better in the derailment.

[00:50:33] Speaker 05:
So it's lower.

[00:50:34] Speaker 05:
But it's still, I guess, these particular types of cars that you're proposing have never been tested.

[00:50:40] Speaker 05:
And there are no studies where there was no puncture.

[00:50:43] Speaker 05:
It just seems potentially catastrophic.

[00:50:46] Speaker 05:
And I guess to put this into the legal framework, you're required to do an environmental impact statement if there's a significant risk.

[00:50:57] Speaker 05:
This is a huge risk and it's not remote or speculative or unlikely to a minimum.

[00:51:02] Speaker 05:
You haven't proposed things that make it to a minimum.

[00:51:05] Speaker 05:
So whether you look at the CEQ regulations or whether you look at the case law, like why is this not something that requires an environmental impact statement?

[00:51:14] Speaker 05:
Because of the significance and the graveness of the danger involved.

[00:51:19] Speaker 06:
I beg to differ, Your Honor.

[00:51:20] Speaker 06:
The agency did require a number of measures to minimize the risks.

[00:51:27] Speaker 06:
It also relied on its lengthy history of hazardous materials, transportation regulation.

[00:51:31] Speaker 05:
But derailment is a risk.

[00:51:33] Speaker 05:
And you can't do anything to, I guess, it's not within your bailiwick to make railroads more safe.

[00:51:40] Speaker 05:
But given that derailment is a risk that's not remote or speculative,

[00:51:45] Speaker 05:
and the catastrophic consequences of a derailment in this scenario, why is not an environmental impact statement required?

[00:51:54] Speaker 06:
Well, Your Honor, a couple of points.

[00:51:57] Speaker 06:
First, I think that's part of why, for example, among the measures that PHMSA required in the rule, it required safety and security route planning to make sure that railroads are taking into account various factors such as population density, track profile, sensitive areas nearby.

[00:52:12] Speaker 06:
So railroads are required to do that, and they do do that.

[00:52:15] Speaker 06:
They also required enhanced braking systems for once there's a certain number of LNG cars in the train.

[00:52:25] Speaker 06:
And some uncertainty doesn't mean that an EIS is required.

[00:52:29] Speaker 05:
And here- But it has to be remote or speculative, or it has to be reduced to almost a minimum.

[00:52:34] Speaker 05:
You just, in your brief, it seems your position is the risks have been lowered, but it hasn't been lowered to the extent that the case law and the regulations, if we rely on them, require.

[00:52:48] Speaker 06:
I disagree, Your Honor.

[00:52:49] Speaker 06:
I think PHMSA took a hard look here and it reasonably concluded, based on its expertise in hazardous materials transportation, based on studying past derailments and what happened in those derailments, based on studying 450 incident reports involving releases from DOT 113 cars specifically,

[00:53:11] Speaker 06:
based on the measures that it put in this rule.

[00:53:14] Speaker 05:
So the safeguards have to sufficiently reduce the impact to a minimum.

[00:53:18] Speaker 05:
You think the risk of a derailment is at a minimum based on what the agency has done?

[00:53:24] Speaker 06:
I think the risk of significant impacts from a derailment has been reduced to a minimum.

[00:53:29] Speaker 06:
Yes, Your Honor.

[00:53:30] Speaker 05:
Okay, explain that.

[00:53:37] Speaker 06:
Because FIMS are required the nine sixteenths of an inch outer shell, which the modeling and data show and the real life derailment analysis show has a reduced risk of punctures.

[00:53:47] Speaker 07:
It also, the DOT- Puncture, if one car gets punctured, is that a significant impact?

[00:53:53] Speaker 07:
Your honor, it very much depends on the context, but- Well, I'm asking this, you just said we have to reduce significant risk of significant impact from a derailment.

[00:54:04] Speaker 07:
You can't stop a derailment.

[00:54:07] Speaker 07:
So then we start talking about punctures.

[00:54:08] Speaker 07:
I'm trying to figure out if one LNG car punctured, does that count as significant impact?

[00:54:14] Speaker 07:
Do you think there have to be multiple punctures?

[00:54:17] Speaker 06:
I think it would very much depend on the circumstances.

[00:54:20] Speaker 07:
What other circumstances?

[00:54:23] Speaker 06:
Where did the derailment happen?

[00:54:25] Speaker 06:
Did the pressure relief devices function as they do in the testing?

[00:54:30] Speaker 06:
how quickly did first responders respond.

[00:54:33] Speaker 06:
PHMSA also does a lot to make sure first responders know how to handle incidents involving hazardous material.

[00:54:40] Speaker 06:
And that's why it required safety and security route planning, so that if any derailments occur, railroads will have considered the potential risks of any given location that they might be transporting.

[00:54:55] Speaker 07:
I guess, I'm trying to interrupt your question here,

[00:54:59] Speaker 07:
I'm trying to understand how you could decide it's no significant impact.

[00:55:04] Speaker 07:
Or it's the minimum possible significant impact from a derailment when you can't, I take it there's no rail path for this LNG that avoids populations altogether.

[00:55:20] Speaker 07:
It avoids people altogether or sensitive environments altogether.

[00:55:26] Speaker 07:
There's going to be people along here.

[00:55:28] Speaker 07:
We don't know where the derailment is going to happen.

[00:55:31] Speaker 07:
If they're avoiding large populous areas, understandable, then they're in rural areas.

[00:55:37] Speaker 07:
you can't make every volunteer fire department in every town of 1,000 people be ready to respond to a punctured LNG car or two or three or a hundred of them.

[00:55:50] Speaker 07:
So I just, I don't understand the analysis.

[00:55:55] Speaker 07:
I'm just maybe just elaborating or giving my own concerns following up on Judge Pan's question is,

[00:56:03] Speaker 07:
just telling me a few technical things that are there doesn't tell me the reality of how this is going to work on the ground.

[00:56:11] Speaker 07:
So if a derailment were to occur in a rural area, so it's not a city, it may not even have a professional firefighting department.

[00:56:23] Speaker 06:
So part of the hazardous materials regulations are requirements for hazard communication.

[00:56:28] Speaker 06:
So every car carrying hazardous materials has placards

[00:56:32] Speaker 06:
denoting what's in it.

[00:56:34] Speaker 06:
Railroads also have to have lists of the contents of every car.

[00:56:37] Speaker 07:
PHMSA has a- How is this any help at all when the derailment occurs in a populous area that has a volunteer fire department?

[00:56:44] Speaker 06:
Because the book will say this evacuation distance.

[00:56:47] Speaker 06:
For example, for LNG, it's a mile, which is a distance that PHMSA uses for a number of substances.

[00:56:52] Speaker 06:
And it says, don't shoot water on it.

[00:56:56] Speaker 06:
Use this type of phone.

[00:56:58] Speaker 06:
And PHMSA also issues-

[00:57:01] Speaker 07:
Does every volunteer fire department in every rural area in the country have phone?

[00:57:08] Speaker 06:
That I don't know, Your Honor, but I do know that PHMSA issues grants to help first responders build up their capabilities.

[00:57:15] Speaker 06:
But the key thing is containing the scene until the railroads have experts that come in.

[00:57:21] Speaker 06:
And I should acknowledge.

[00:57:23] Speaker 07:
Are they on the train already?

[00:57:25] Speaker 07:
Or how fast do they come in?

[00:57:26] Speaker 07:
I don't know where they're based.

[00:57:27] Speaker 06:
I don't know either, Your Honor.

[00:57:29] Speaker 07:
All this stuff seems like stuff we need to know if you're going to say there's no significant impact from a debailment, where there's a car punctured, or two, or three.

[00:57:40] Speaker 07:
Your Honor, I think PHMSA looked.

[00:57:43] Speaker 07:
I grew up in a small town, so I'm trying to figure out how this is, how they're supposed to respond to this in a timely manner.

[00:57:49] Speaker 07:
You don't have days before the harm happens here.

[00:57:52] Speaker 07:
You've got, what, maybe minutes or hours?

[00:57:56] Speaker 06:
Well, that's partly why PHMSA required such a robust tanked car here, because that buys time.

[00:58:03] Speaker 06:
It reduces the number of punctures.

[00:58:04] Speaker 06:
The DOT 113 cars also have redundant pressure relief systems.

[00:58:09] Speaker 06:
The pressure relief devices are on either side of the car.

[00:58:13] Speaker 06:
So even if there is a fire, PHMSA expects that the pressure relief devices will function, and any dangerous pressures will be vented.

[00:58:23] Speaker 05:
So are there two different risks here?

[00:58:26] Speaker 05:
The pressure release is, it guards against the rail car exploding from the buildup of pressure inside.

[00:58:35] Speaker 05:
Because if the LNG starts, they call it boiling, but it starts, it goes above the negative 260, it starts to become vapor and it builds up pressure and it can explode the car.

[00:58:47] Speaker 05:
But the puncture is, it comes out and then it can be ignited.

[00:58:52] Speaker 05:
Right?

[00:58:53] Speaker 05:
Isn't that the risk?

[00:58:54] Speaker 05:
And it can do this like vapor cloud and all kinds of things can happen once it gets out and there's a puncture.

[00:59:01] Speaker 05:
And if it's ignited and there's a car of 22 of these, do the other ones ignite as well?

[00:59:06] Speaker 05:
I'm just trying to understand.

[00:59:08] Speaker 05:
There's a couple different kinds of risks here.

[00:59:13] Speaker 05:
And it's just not at all clear to me that the agency has done the work of testing these different scenarios that could occur.

[00:59:19] Speaker 07:
Does pressure relief deal with the leak?

[00:59:23] Speaker 06:
So a couple points, Your Honor, and I apologize for being unclear.

[00:59:30] Speaker 06:
A pressure relief device is not what's going to prevent a release of hazardous material.

[00:59:34] Speaker 06:
I do want to clarify, there's different terminology, or just because there's a puncture doesn't mean there's a release of hazardous material.

[00:59:40] Speaker 06:
You can have a puncture, for example, of the outer shell.

[00:59:42] Speaker 06:
That doesn't mean the inner shell got punctured.

[00:59:46] Speaker 06:
But going with your hypothetical, assume there is a breach.

[00:59:50] Speaker 06:
and there's a release of LNG, and it does catch on fire, which is three ifs all together right there.

[00:59:57] Speaker 05:
But it doesn't seem very remote in a derailment.

[01:00:03] Speaker 06:
Your Honor, PHMSA evaluated the risks here.

[01:00:05] Speaker 06:
No, I understand.

[01:00:07] Speaker 05:
I just think derailments happen.

[01:00:09] Speaker 05:
Sometimes they're quite severe.

[01:00:10] Speaker 05:
You have, I mean.

[01:00:14] Speaker 05:
It's clear that it happens, and sometimes the trains are wrecked.

[01:00:19] Speaker 05:
And so what happens if there's 80 LNG rail cars in a row and one of them say pressure release doesn't work and it explodes, and I guess it says that happens, you've got a fireball, you've got projectiles, you've got all kinds of stuff, does the entire train blow?

[01:00:39] Speaker 05:
Like a rush of a bomb?

[01:00:41] Speaker 06:
PHMSA concluded that the pressure relief devices would work, because there's redundant.

[01:00:45] Speaker 06:
So even if one doesn't work, the other one would.

[01:00:47] Speaker 06:
Then let's say there's a fire going with your example.

[01:00:50] Speaker 06:
Then the other cars, let's say another car heats up, then its pressure relief devices will work.

[01:00:56] Speaker 06:
And again, we have the robust outer tanks.

[01:00:59] Speaker 06:
And these are the 113 cars.

[01:01:00] Speaker 06:
The tanks are breached.

[01:01:03] Speaker 07:
I just want to make sure I understand this engineering question.

[01:01:07] Speaker 07:
The breach, if the inner tank is breached, pressure release is no help because you've got a hole in the stuff coming out, right?

[01:01:17] Speaker 06:
Yes, Your Honor.

[01:01:17] Speaker 07:
If the inner tank's breached, we've got to assume the outer tank is breached.

[01:01:20] Speaker 06:
Yes, Your Honor, and that is true if the inner tank's breached the outer tank.

[01:01:24] Speaker 06:
I'm sorry, I'm trying to respond to the question of if one car breaches, how would that affect other unbreached cars?

[01:01:30] Speaker 06:
And for those cars, if they're exposed to fire, then they would vent.

[01:01:37] Speaker 06:
What are they venting?

[01:01:38] Speaker 07:
Are they releasing LNG into the air, or what are they venting?

[01:01:41] Speaker 06:
Yes, yeah.

[01:01:41] Speaker 06:
They would be venting LNG vapor.

[01:01:44] Speaker 05:
I think I read someplace that if they turn upside down, the vent system doesn't work.

[01:01:49] Speaker 06:
PHMSA, I believe at JA459, has

[01:01:55] Speaker 06:
footnote that says even if they're upside down, the way the pipes work, they'll still vent.

[01:02:07] Speaker 05:
But did PHMSA determine with 100% certainty that the pressure release systems always work in a derailment?

[01:02:18] Speaker 06:
I'm not aware that it reached 100% certainty, no, Your Honor.

[01:02:22] Speaker 06:
But it did examine every incident report it had for a DOT 113 car ever since those have been in operation.

[01:02:30] Speaker 06:
And that's over 50 years, 100,000 trips transporting hazardous material in the 113 cars.

[01:02:38] Speaker 05:
The NTSB said that what you did was not adequate.

[01:02:42] Speaker 06:
The NTSB recommended that PHMSA adopt certain operational controls, and it did follow the NTSB's recommendations.

[01:02:50] Speaker 06:
I mean, in rule-makings, the agency's not necessarily going to.

[01:02:53] Speaker 05:
But more than that, though, said that it was not an effective safety evaluation.

[01:03:00] Speaker 06:
Your Honor, there's a range of comments that come in on any given rule-making.

[01:03:05] Speaker 06:
And PHMSA responded to the NTSB's comments, and it

[01:03:09] Speaker 06:
The NTSB made some suggestions that PHMSA thought were reasonable and it adopted them.

[01:03:15] Speaker 07:
Is there any risk from the vented LNG vapor?

[01:03:20] Speaker 07:
Health risk if you had say 80 cars of LNG on the train and they all had to start venting?

[01:03:25] Speaker 07:
Is there any risk from that?

[01:03:27] Speaker 07:
Or is it only if it's actually?

[01:03:30] Speaker 06:
I suppose there could be risk.

[01:03:34] Speaker 06:
The PHMSA's emergency response guidebook that it publishes that gives information about how to deal with each hazardous material does describe if there's vapor, you need certain personal protective equipment.

[01:03:52] Speaker 06:
So I can't say that venting LNG is reducing the risk to zero.

[01:03:59] Speaker 07:
But if the pressure relief system itself creates a hazard for people in the area, and you're going to have 80 or 100 of these cars, and let's assume any 20 or 30 of them, because of the derailment, are all venting at the same time, does that create its own safety hazard?

[01:04:21] Speaker 07:
So LNG will... Excuse me.

[01:04:24] Speaker 07:
So where did PIMSA address it?

[01:04:28] Speaker 07:
I'm sorry, would you mind saying that?

[01:04:30] Speaker 07:
If you have multiple cards, the large numbers that are authorized here, venting at the same time and in the same area, does that create its own health issue?

[01:04:44] Speaker 06:
No, Your Honor.

[01:04:45] Speaker 05:
But the environmental assessment said that venting LNG can catch fire.

[01:04:49] Speaker 05:
There was an incident in the environmental assessment.

[01:04:52] Speaker 06:
Yes, it can.

[01:04:53] Speaker 06:
It can.

[01:04:53] Speaker 06:
What I'm saying to the health issue is in the air, LNG will eventually dissipate.

[01:04:58] Speaker 06:
And part of PHMSA and PHMSA in the guidebook recommends a one mile evacuation distance for LNG.

[01:05:07] Speaker 07:
So the venting starts right away from the derailment.

[01:05:12] Speaker 07:
If the pressure goes up, it's going to start pretty fast.

[01:05:15] Speaker 06:
I mean, it would depend on that.

[01:05:17] Speaker 07:
It must take some time to evacuate a community a mile away.

[01:05:24] Speaker 06:
I mean, how quickly the venting would start, I think, would depend on the circumstances of the derailment.

[01:05:29] Speaker 06:
And the time it would take to do an evacuation would also depend, I think, Your Honor.

[01:05:34] Speaker 07:
On the prior transportation of things, I guess, ethylene is the one that the agency thought was most similar.

[01:05:41] Speaker 07:
Is my understanding correct that there isn't a history of having 10, even 10, let alone 100 ethylene cars in a single train?

[01:05:52] Speaker 07:
That it was only a couple at a time?

[01:05:54] Speaker 06:
That is correct for ethylene, which is similar as a cryogenic flammable liquid to LNG.

[01:06:02] Speaker 06:
But PHMSA also has experience with high hazard flammable trains like crude oil and ethanol.

[01:06:07] Speaker 06:
And those are transported in quantities of 80, 100, or more.

[01:06:10] Speaker 05:
So this was the comment from the NTSB, because unit trains of DOT 113 tank cars carrying large volumes of flammable cryogenic gases have no operational or accident performance safety history, we believe a thorough safety assessment of the tank car specification is needed.

[01:06:31] Speaker 05:
There's no history of doing what this rule allows.

[01:06:40] Speaker 06:
There's no history of unit trains, which are trains carrying all of one thing, large numbers with DOT 113 cars.

[01:06:50] Speaker 06:
But PHMSA looked at a number of sources for its conclusions in this rule.

[01:06:56] Speaker 06:
It looked at the history of 113 cars, which is what you need for a cryogenic liquid.

[01:07:01] Speaker 06:
It also looked at the history of unit train transportation of flammable liquids, like crude oil and ethanol.

[01:07:07] Speaker 07:
That's totally different.

[01:07:09] Speaker 07:
You have a derailment with crude oil is very different from a crude, a derailment with LNG.

[01:07:16] Speaker 06:
There certainly are differences, your honor, but I think it's, that's where PHMSA's expertise really comes in to say, here's, here's what makes sense to.

[01:07:24] Speaker 07:
On your expertise.

[01:07:26] Speaker 07:
I want to throw one more mix into the factor here.

[01:07:27] Speaker 07:
No speed limit.

[01:07:30] Speaker 07:
No speed limit.

[01:07:31] Speaker 07:
I mean, you talk about, there's a voluntary standard.

[01:07:35] Speaker 07:
by the American Association of Railroads, American Railroad Association.

[01:07:41] Speaker 07:
Is every railroad that's gonna transport LNG required to be a member of that association?

[01:07:48] Speaker 06:
That I don't know, Your Honor, but I do know that- That's not the rule.

[01:07:52] Speaker 07:
Then the rule requires you to be a member.

[01:07:54] Speaker 07:
Maybe every train is already a member, I don't know.

[01:07:57] Speaker 06:
My understanding is that PHMSA, that all railroads have incorporated the industry requirements for best practices into their operating rules.

[01:08:08] Speaker 06:
And PHMSA and the Federal Railroad Administration are not aware of railroads not complying with it.

[01:08:13] Speaker 04:
I'd like to ask you a question on a somewhat different topic.

[01:08:18] Speaker 04:
Two years ago, or no, a year ago, it was a 22 or 23.

[01:08:24] Speaker 04:
You filed a document in this court

[01:08:27] Speaker 04:
opposing lifting of the advance that the court had issued.

[01:08:33] Speaker 04:
Do you remember that?

[01:08:34] Speaker 04:
Yes, Your Honor.

[01:08:35] Speaker 04:
And you made representations in that document about the ongoing activities of this particular administration aimed at amending the rule that we're now arguing about.

[01:08:49] Speaker 06:
Yes, Your Honor.

[01:08:50] Speaker 04:
And you also said that imminently or soon,

[01:08:56] Speaker 04:
that another abeyance regulation would be issued.

[01:09:01] Speaker 04:
Do you remember that?

[01:09:03] Speaker 06:
I'm not sure the adverb that I used, Your Honor.

[01:09:07] Speaker 04:
I just looked at it, trust me.

[01:09:09] Speaker 04:
But what is going on now?

[01:09:14] Speaker 04:
You say in your brief that there's all kinds of studies that have been done.

[01:09:18] Speaker 04:
There's a joint task force that's been put together.

[01:09:24] Speaker 04:
You said that the fact

[01:09:26] Speaker 04:
whenever this was, let me get the dates straight.

[01:09:29] Speaker 04:
This was a year ago in June.

[01:09:32] Speaker 04:
He said that the agency was contemplating two rule makings.

[01:09:37] Speaker 04:
One is to amend the rule that we're talking about here.

[01:09:40] Speaker 04:
And the other was another suspension.

[01:09:43] Speaker 04:
So what has happened?

[01:09:46] Speaker 04:
What is going on now?

[01:09:48] Speaker 06:
The rule is currently suspended.

[01:09:50] Speaker 06:
PHMSA suspended the rule in September of 2023 and it's suspended through June of 2025.

[01:09:59] Speaker 06:
So before the suspension happened, nobody had transported LNG by rail under the rule.

[01:10:04] Speaker 06:
Now nobody can because the rule is suspended through June 2025.

[01:10:08] Speaker 06:
PHMSA has also been doing a number of tests

[01:10:13] Speaker 06:
and that it is planning to use to inform a subsequent rulemaking that would amend this rule or revise it in some way or consider doing so.

[01:10:22] Speaker 06:
And in the spring 2024 unified regulatory agenda, PHMSA said that it anticipated doing a notice of proposed rulemaking.

[01:10:31] Speaker 04:
Has something been submitted to OMB?

[01:10:34] Speaker 06:
No, Your Honor.

[01:10:35] Speaker 07:
So you anticipate doing an NPRM when?

[01:10:40] Speaker 06:
The Spring 2024 Unified Regulatory Agenda said April 2025.

[01:10:45] Speaker 07:
Okay, so there's no way you're going to have a final rule by June 25 when the suspension ends.

[01:10:53] Speaker 06:
That may be unlikely, Your Honor, although PHMSA could decide to extend the suspension.

[01:10:58] Speaker 06:
It hasn't made any final decisions in any direction on these.

[01:11:01] Speaker 04:
Do you know whether there's any further suspension regulation in the works?

[01:11:08] Speaker 06:
I don't think PHMSA is currently working on one, but it may choose to do so between now and June.

[01:11:15] Speaker 04:
Is this rule on a list that submitted pursuant to the executive order, that submitted to IRA?

[01:11:26] Speaker 06:
There was- When President Biden took office, Your Honor?

[01:11:30] Speaker 04:
Yeah, which required examination of every regulation that was issued during the Trump administration that affects the environment.

[01:11:39] Speaker 04:
Yes, Your Honor, this was- It was on the list.

[01:11:43] Speaker 06:
To be very precise, Your Honor, it wasn't named in the executive order, but it was on the White House list of rules that needed to be considered under the executive order.

[01:11:52] Speaker 04:
Is there any official agency pronouncement indicating that this rule needs to be amended?

[01:12:01] Speaker 06:
PHMSA has not reached any final conclusions, Your Honor, about whether it's going to amend the rule in some way or take some other action.

[01:12:10] Speaker 04:
Well, let me rephrase the question.

[01:12:13] Speaker 04:
But whether this rule is going to be amended or repealed.

[01:12:19] Speaker 06:
PHMSA has not reached any final conclusions on that, Your Honor.

[01:12:23] Speaker 04:
And the representations that we see from counsel that sort of hint at that are not approved by the administration, not that Biden administration, the administration, the hazardous materials administration.

[01:12:41] Speaker 06:
Your Honor, PHMSA has reviewed every filing that we've submitted in court, and it has published

[01:12:50] Speaker 06:
in the unified regulatory agenda anticipated timing for what we've been calling the amendment rule.

[01:12:57] Speaker 06:
The anticipated timing for the notice of proposed rulemaking for the amendment rule has shifted back several times.

[01:13:07] Speaker 07:
Has it shifted since that last pronouncement?

[01:13:09] Speaker 04:
So I'm asking these questions because I think there's a substantial question whether this case is right.

[01:13:18] Speaker 04:
There's a Supreme Court case called EPA versus Brown that indicated when the attorney for EPA got up and argued before the Supreme Court and then said that the regulation in front of the court was going to be amended, had to be amended.

[01:13:34] Speaker 04:
The Supreme Court then vacated the lower court's decisions pending the outcome of that proceeding.

[01:13:44] Speaker 04:
And if we're not there with this rule,

[01:13:47] Speaker 04:
It seems to me, given the representations that have been made, we're awfully close.

[01:13:51] Speaker 04:
And there is a timing question.

[01:13:53] Speaker 04:
I agree.

[01:13:54] Speaker 04:
But we're going ahead and deciding the validity of a rule which may never go into effect practically.

[01:14:04] Speaker 06:
That may be true, Your Honor.

[01:14:05] Speaker 06:
I don't know when any final amendment rule would issue if PHMSA has not yet made any final.

[01:14:14] Speaker 04:
I'm speaking for myself.

[01:14:17] Speaker 04:
and I haven't consulted with my colleagues here, I would like to see a representation in writing from you on behalf of that agency with respect to the timing of any possible new suspension regulation or a notice of proposed rulemaking.

[01:14:34] Speaker 04:
And if there is no such schedule, I'd like that to be stated in the filing too.

[01:14:41] Speaker 04:
Yes, Your Honor.

[01:14:42] Speaker 06:
Thank you.

[01:14:44] Speaker 06:
I will do that.

[01:14:47] Speaker 07:
I forget where we were.

[01:14:53] Speaker 07:
I'm just still concerned about the speed limit.

[01:14:55] Speaker 07:
If we don't know that all trains are members, or even if they are all members, all it requires is voluntary compliance.

[01:15:01] Speaker 07:
And the rationale being that gives the industry flexibility to respond more quickly if new technology comes along.

[01:15:11] Speaker 07:
There's no speed limit.

[01:15:14] Speaker 07:
There's no speed limit.

[01:15:15] Speaker 07:
It's like if they sit on the beltway here, 55, but it's voluntary.

[01:15:20] Speaker 07:
There's no enforced speed limit for these trains of 80 to 100 LNG cars.

[01:15:28] Speaker 07:
And I just didn't see that.

[01:15:29] Speaker 07:
The assumption that, well, we're trusting that everybody will comply seems to me, I think you have to factor in your testing

[01:15:41] Speaker 07:
What are the prospects of somebody violating the 55 mile per hour rule?

[01:15:45] Speaker 05:
And to add to that, there was an accident at 42 miles per hour where there was puncture with nine sixteenth of an inch cars.

[01:15:55] Speaker 06:
Your honor, PHMSA and the Federal Railroad Administration.

[01:16:02] Speaker 06:
They are not aware of any instances of railroads not complying with their operating.

[01:16:06] Speaker 07:
Railroads have to comply when they violate the, it's not even a violation, it's voluntary.

[01:16:10] Speaker 07:
They have to report their speeds to these association or to FRA or.

[01:16:17] Speaker 06:
I'm not aware that railroads have to report their speeds all the time.

[01:16:21] Speaker 06:
A lot of the speeds are programmed into the trains.

[01:16:24] Speaker 06:
A lot of trains have PTC, I think it's positive train control.

[01:16:30] Speaker 06:
programmed in, and so they program it in.

[01:16:32] Speaker 07:
A lot of trains?

[01:16:33] Speaker 07:
Does that mean all trains that would carry LNG?

[01:16:36] Speaker 06:
I don't know, Your Honor.

[01:16:37] Speaker 06:
I think it's the most trains on major tracks by major railroads, which have... Those ones that carry LNG?

[01:16:45] Speaker 07:
I don't know.

[01:16:46] Speaker 07:
This seems to me a big hole, a big problem.

[01:16:51] Speaker 07:
That if there's actually no enforceable speed limit,

[01:16:56] Speaker 07:
And you say we don't know about violations.

[01:16:59] Speaker 07:
Well, I'm assuming people don't voluntarily report when they go over a speed limit, let alone a voluntary speed limit.

[01:17:07] Speaker 07:
But what's to report?

[01:17:08] Speaker 07:
It was voluntary.

[01:17:10] Speaker 06:
Well, railroads do have to comply with their operating rules.

[01:17:12] Speaker 06:
I should also note that railroads have their own speed limits related to the particular tracks and the track profile that they're in.

[01:17:20] Speaker 07:
Do any of those go over 55 miles per hour?

[01:17:25] Speaker 06:
To my knowledge, Your Honor, the fastest any freight train could go would be 70 miles per hour.

[01:17:32] Speaker 06:
But that would not be if it had 20 cars of hazardous material or one car.

[01:17:38] Speaker 07:
Even one car of hazardous material?

[01:17:40] Speaker 06:
If it had one car of spent nuclear fuel or poisonous by inhalation.

[01:17:44] Speaker 07:
I'm asking if it would one car of LNG or two.

[01:17:49] Speaker 06:
It would depend on the track locations.

[01:17:53] Speaker 07:
They could go more than 55.

[01:17:56] Speaker 06:
It is possible, Your Honor.

[01:17:58] Speaker 06:
It would depend on the track location and the railroads security and safety route planning, their analysis of the track profile, all of those things.

[01:18:11] Speaker 07:
Cross your fingers and hope rule.

[01:18:15] Speaker 06:
I beg to differ, Your Honor.

[01:18:16] Speaker 07:
I think PHMSA- Is there uncertainty as to what speed these trains are going to travel for purposes of whether an EIS is needed and what the impact of given higher speeds, frequency and impact of higher speeds would be?

[01:18:31] Speaker 06:
PHMSA did not believe that there was any uncertainty.

[01:18:34] Speaker 07:
What basis?

[01:18:34] Speaker 07:
Can you tell them you don't know if all trains are even part of this association so those trains won't even be subject to this voluntary standard?

[01:18:42] Speaker 07:
We don't have any idea how many comply with this voluntary standard.

[01:18:47] Speaker 07:
We don't know how many have it programmed in speed control and what that speed control is because apparently on some tracks it could be 70 miles per hour.

[01:18:55] Speaker 07:
That seems like a lot of unknowns that seem quite relevant to what

[01:19:03] Speaker 07:
I assume the speed of trains is a factor in increasing the risk of derailment.

[01:19:08] Speaker 07:
Is that wrong as a matter of physics?

[01:19:11] Speaker 06:
I cannot say the court is wrong.

[01:19:13] Speaker 07:
No.

[01:19:14] Speaker 07:
I haven't had physics since high school.

[01:19:15] Speaker 07:
So you could say I'm wrong and I would have to defer.

[01:19:18] Speaker 07:
But OK.

[01:19:21] Speaker 05:
Can I just add to that though?

[01:19:22] Speaker 05:
Does the agency have some kind of an obligation to make sure this 50 miles per hour is appropriate for this kind of hazardous material given the sort of unprecedented

[01:19:34] Speaker 05:
sort of danger that is posed by like an 80 car train full of LNG using a tank car that's never been tested for safety before.

[01:19:45] Speaker 05:
Can the agency just default to 50 miles per hour without looking to see if this voluntary standard is even the correct one for this type of transport?

[01:19:58] Speaker 06:
So even setting aside the fact that, to the best of PHMSA's knowledge, railroads are complying with it.

[01:20:04] Speaker 06:
But even setting that aside, Your Honor, 50 miles per hour is also the speed limit that PHMSA does mandate for trains carrying hazardous materials that are poisonous by inhalation.

[01:20:16] Speaker 06:
It's also the speed limit mandated for the high hazard flammable trains, the ones with 8,100 cars.

[01:20:22] Speaker 06:
of crude oil or ethanol.

[01:20:23] Speaker 05:
I guess my question is just that, can you assume that that's the right level for this sort of previously unknown situation where we could have like an 80 to 100 car train full of LNG with the risks that we've been discussing this morning?

[01:20:39] Speaker 05:
Is it okay or is it arbitrary and capricious to assume that?

[01:20:43] Speaker 06:
I think PHMSA acted reasonably here in evaluating the

[01:20:51] Speaker 05:
But did they evaluate, like, this particular substance versus the others in terms of the, I guess, the speed that would be safe to transport it?

[01:21:02] Speaker 06:
Not to my knowledge, Your Honor, but I also should note that PHMSA here was saying... So why is that reasonable?

[01:21:13] Speaker 06:
Because, Your Honor, of PHMSA's long expertise in the field of hazardous materials regulation and

[01:21:21] Speaker 05:
If they didn't exercise expertise, if they didn't even compare it, it doesn't sound like they even thought about it, that this particular substance could be different from the others.

[01:21:34] Speaker 06:
Well, PHMSA thought very hard about LNG as compared to other materials.

[01:21:40] Speaker 06:
So I apologize if I've communicated otherwise, but it compared.

[01:21:44] Speaker 05:
But in terms of the safety of the speed with which you transport it, they didn't consider that.

[01:21:49] Speaker 05:
Not that.

[01:21:50] Speaker 05:
It seems to me a risk of derailment of the 80-car LNG thing is very different from the two or three-car ethylene car.

[01:21:57] Speaker 05:
It's a completely different thing.

[01:21:59] Speaker 05:
So maybe you want to go a little bit slower if you've got the 80 cars of LNG.

[01:22:05] Speaker 06:
Well, so there, then, the comparison for PHMSA was the crude oil or ethanol trains.

[01:22:10] Speaker 06:
They're not Hiroshima bombs.

[01:22:14] Speaker 06:
I can't speak to the accuracy of the Hiroshima Bomb Act analogy.

[01:22:17] Speaker 07:
Just to pin one thing down, you said, to the best of its knowledge, thought folks would comply with its 50-mile-per-hour speed limit.

[01:22:24] Speaker 07:
And what I want to understand is, what was the knowledge that was the best of their knowledge?

[01:22:29] Speaker 07:
What information did they have?

[01:22:31] Speaker 07:
Other than that, what I'm aware of, and you can supplement, is that this association has a voluntary standard for its members.

[01:22:40] Speaker 07:
Sorry, it's a 50 or 55-mile-per-hour.

[01:22:44] Speaker 07:
And that 50 50 miles per hour.

[01:22:49] Speaker 07:
What are the knowledge did you have?

[01:22:51] Speaker 06:
Um, things that worked on this role with the Federal Railroad Administration, which regularly reviews railroads and, um, the, the industry practice requirements, the document called OT 55, which is what specifies the 50 mile per hour limit is incorporated into railroad operating roles.

[01:23:11] Speaker 07:
And it's a voluntary or mandatory.

[01:23:14] Speaker 06:
Railroads have to comply with their operating rules and PHMSA and the federal operating rules are there's a voluntary limit.

[01:23:23] Speaker 07:
There's two ways of incorporation.

[01:23:25] Speaker 07:
It's you could take some of this voluntary incorporated as mandatory 55 or 50 mile an hour cap full stop or it could be as part of your operating rules.

[01:23:35] Speaker 07:
There's a voluntary limit of 50 miles per hour.

[01:23:38] Speaker 07:
And so it's incorporated as voluntary.

[01:23:42] Speaker 07:
You just haven't changed anything in my view.

[01:23:45] Speaker 06:
Your honor, the industry guidance document, OT55, says that if there are, for key trains, which is trains with 20 or more cars for LNG, you just need one of spent nuclear fuel or poisonous by inhalation, but a key train for LNG would be 20.

[01:24:04] Speaker 06:
The maximum speed is 50 miles per hour.

[01:24:06] Speaker 05:
Now, didn't NTSB want that capped at 40 in high threat areas?

[01:24:14] Speaker 06:
The NTSB may have made that suggestion, but that isn't.

[01:24:19] Speaker 06:
Did the agency address that comment?

[01:24:22] Speaker 05:
And why they didn't need to do that?

[01:24:24] Speaker 05:
I'm not sure, Your Honor.

[01:24:27] Speaker 07:
Any other questions?

[01:24:30] Speaker 07:
Great.

[01:24:30] Speaker 07:
Thank you very much.

[01:24:31] Speaker 07:
Or did you want to have a wrap-up sentence here?

[01:24:33] Speaker 07:
But otherwise, I will echo Judge Randolph's request for this information about whether we should even be deciding this case.

[01:24:41] Speaker 06:
Yes, Your Honor, we will file something in writing.

[01:24:44] Speaker 06:
I just wanted to note a sensitivity.

[01:24:47] Speaker 06:
If the court is inclined to rule against the United States, PHMSA has, in the past, had to require a particular packaging that has never been tested or built before because it knew that packaging was safer than what was already in use.

[01:25:01] Speaker 06:
And if the court issues a ruling that requires certain amounts of testing or data before a packaging can be allowed under the Hazardous Materials Transportation Act,

[01:25:11] Speaker 06:
that could have negative consequences for PHMSA's very important safety mission.

[01:25:15] Speaker 07:
It's important, thank you.

[01:25:17] Speaker 07:
Thank you.

[01:25:21] Speaker 07:
Okay, Mr. Marshall, we'll give you two minutes.

[01:25:24] Speaker 08:
Thank you, Your Honor.

[01:25:25] Speaker 08:
For the voluntary speed limit to even apply, it doesn't apply if you have 19 of these LNG tank cars in a row or 34 spread throughout the consist.

[01:25:36] Speaker 08:
In that case, there's not even a voluntary speed limit.

[01:25:38] Speaker 08:
It only applies if there's 20 in a row or 35 spread throughout the consist.

[01:25:43] Speaker 08:
On the route planning requirements, there's no binding requirements to not go in any specific places.

[01:25:49] Speaker 08:
It's an analysis.

[01:25:50] Speaker 08:
It's a consideration.

[01:25:52] Speaker 08:
You can still go through urban areas after you do that analysis.

[01:25:55] Speaker 08:
And so you could still have LNG unit trains going through major urban areas under this rule.

[01:26:03] Speaker 08:
Regarding pressure release devices, they will only work if they're upright.

[01:26:07] Speaker 08:
It's in the record, if you look at Joint Appendix 427, that if a tank car gets overturned on its side or whatever, which often happens in derailments, they do not work.

[01:26:17] Speaker 08:
It requires that they be upright.

[01:26:19] Speaker 08:
The reference to JA459 doesn't say anything about them working if the tank car is overturned.

[01:26:25] Speaker 08:
It refers to the complicated

[01:26:27] Speaker 08:
slightly more complicated nature of the pressure release devices of the DOT 113 tank car in regarding to the fittings and the risk of liquid leak.

[01:26:36] Speaker 08:
It does not address or even hint that pressure release devices will work if they are overturned.

[01:26:44] Speaker 07:
Can I ask you just one more thing?

[01:26:49] Speaker 07:
When do you think this first shipment of LNG and one of these new cars could happen, assuming they don't suspend it and don't amend it?

[01:26:55] Speaker 08:
after the rule springs back into effect in 2025.

[01:26:57] Speaker 08:
We know from PHMSA.

[01:26:59] Speaker 07:
There's tanks built.

[01:27:00] Speaker 07:
These new cars are already built.

[01:27:02] Speaker 08:
Well, yes, we know that they're being built.

[01:27:04] Speaker 08:
I mean, as PHMSA said.

[01:27:05] Speaker 07:
Being built is different than.

[01:27:06] Speaker 08:
Yes, they have been built.

[01:27:08] Speaker 08:
Yes, they have been built.

[01:27:10] Speaker 07:
PHMSA.

[01:27:10] Speaker 07:
They're sitting out there on the sale lot.

[01:27:12] Speaker 08:
PHMSA believes that they have been built for ethylene and that they know that there was interest in other orders.

[01:27:17] Speaker 08:
That was of 2023.

[01:27:18] Speaker 08:
There's nothing in the record since then about

[01:27:23] Speaker 08:
how many have actually been constructed since then and how many are available to ship LNG.

[01:27:29] Speaker 08:
But we know that there's, we know that Energy Transport Solutions intends to use it.

[01:27:34] Speaker 08:
Their new special permit to use the existing DOT 113 tank car was denied.

[01:27:38] Speaker 08:
And so they said that they have to rely under this rule.

[01:27:41] Speaker 07:
When does that start?

[01:27:43] Speaker 07:
Are they having to use it right now then?

[01:27:44] Speaker 07:
Or when does their new permit?

[01:27:46] Speaker 08:
No, no.

[01:27:46] Speaker 08:
It's expired.

[01:27:47] Speaker 08:
So they can't use the special permit to transport LNG under the DOT 113 existing tank cars.

[01:27:53] Speaker 07:
And do they have a permit to do it under this new tank car?

[01:27:55] Speaker 07:
And are they doing it?

[01:27:56] Speaker 08:
Well, they wouldn't need a permit, because there's no permits required under this rule.

[01:27:59] Speaker 07:
Well, until the rule, until 2025.

[01:28:01] Speaker 07:
Right.

[01:28:01] Speaker 07:
OK.

[01:28:01] Speaker 07:
Yes.

[01:28:01] Speaker 08:
No, they're not doing it.

[01:28:02] Speaker 08:
I understand your question now, Your Honor.

[01:28:04] Speaker 08:
I apologize.

[01:28:05] Speaker 08:
There is no special permit to use this tank car right now for energy transport solutions.

[01:28:12] Speaker 07:
Any other questions?

[01:28:14] Speaker 08:
Thank you, Your Honor.

[01:28:16] Speaker 07:
All right, Mr. Rentschi, we'll give you the same two minutes.

[01:28:26] Speaker 03:
Thank you, Your Honor.

[01:28:29] Speaker 03:
The NHPA regulations are clear that Indian tribes get special treatment in the consultation analysis.

[01:28:38] Speaker 03:
Section 800.2 says that the federal government has a unique legal relationship with Indian tribes.

[01:28:44] Speaker 03:
that consultation with Indian tribes should be conducted in a sensitive manner, respectful of tribal sovereignty.

[01:28:51] Speaker 03:
Consultation with an Indian tribe must recognize the government to government relationship between the federal government and Indian tribes, and consultation with Indian tribes should be conducted in a manner sensitive to the concerns and needs of the Indian tribe.

[01:29:07] Speaker 03:
What happened here

[01:29:08] Speaker 03:
handful of emails sent over a few weeks offering an agency lawyer with no decision-making authority while three years into the rulemaking proceeding a few months before the the final rule was published did not comply with the standards there.

[01:29:25] Speaker 03:
And the last point I want to make is

[01:29:29] Speaker 03:
I talked about sending letters and how, in all these other cases, letters were sent.

[01:29:34] Speaker 03:
And Judge Miller, you asked me, what are they supposed to do if they're sending emails that aren't being responded to?

[01:29:40] Speaker 03:
They could have done what happened in every one of these other cases, which is if the staff level employee who was offering the agency lawyer for consultation didn't think his emails were being responded to fast enough,

[01:29:55] Speaker 03:
agency could have sent a letter to the tribe and formally invoking consultation.

[01:30:05] Speaker 03:
That should have happened.

[01:30:06] Speaker 03:
More was required.

[01:30:08] Speaker 07:
Does the tribe deny that it got the emails?

[01:30:11] Speaker 03:
No, the tribe is not denying that it got the emails.

[01:30:14] Speaker 03:
We're saying that this was not sending a few emails over a few weeks is not conducting consultation in a manner respectful of tribal sovereignty and recognizing the special relationship between two sovereigns.

[01:30:27] Speaker 07:
Thank you very much.

[01:30:28] Speaker 07:
This case is submitted.