U.S. judge tosses lawsuit to block All Aboard Florida; Money for Phase 2 still in question

By Ann Henson Feltgen, FloridaBulldog.org 

All Aboard Florida’s Brightline Express train

All Aboard Florida’s plan to operate regular passenger train service between Miami and Orlando survived a lawsuit filed by Indian River and Martin counties when a federal judge on May 10 dismissed the suit. But funding problems remain.

The counties, which opposed the train, sued the U.S. Department of Transportation (DOT) in 2015, stating the agency ignored the requirements of the National Environmental Policy Act when it agreed to issue $1.75 billion in non-taxable private activity bonds (PAB) for All Aboard Florida (AAF), which would mean up to $600 million in lost tax revenue over 10 years, according to court documents.

Phase 1 of the ambitious project, creating a passenger route and terminals at three stops along the Florida East Coast railroad line between Miami and West Palm Beach, is well under way. It is Phase 2 that is now precarious.

AAF, whose parent company – Florida East Coast Industries – is owned by the hedge fund Fortress Investment Group, approached the state nearly three years ago with a plan to build and operate a privately owned railroad that would allow passengers to travel from Miami to Cocoa and from there to Orlando. AAF claims that trains would shave at least an hour off the drive time by car.

Railroad depots are nearly complete in Miami, Fort Lauderdale and West Palm Beach; a second set of tracks is being installed, and new engines and passenger cars have been shipped. AAF estimates that both phases now will cost more than $2.9 billion, excluding the cost of easements and land purchases it has already made.

But a lawsuit by Martin and Indian River counties, which challenged DOT’s bonding authority in federal court in Washington, D.C. in April 2015, gained traction last fall as their attorneys fended off DOT’s motion to dismiss the case while uncovering evidence that AAF has little or no money in hand to begin Phase 2 construction.

AAF withdrew its application for the bonds on Sept. 30, 2016 and requested another $600-million bond issue to complete Phase 1, possibly resolving the matter.

Attorneys for the counties argued that AAF will not limit the $600-million bond funding to Phase 1. As evidence, they stated in their earlier motion that AAF said the money would be used to pay for five train sets, which will service the entire route rather than just Phase 1.

Judge Cooper rules

After several hearing delays, Judge Christopher R. Cooper of the U.S. District Court for the District of Columbia now says because the train company pulled its request for the bonds, the issue is moot.

AAF continues work on Phase 1 that runs the trains from Miami to West Palm Beach and is expected to begin operating between West Palm Beach and Fort Lauderdale in late summer. The extension to Miami will open after that, company officials said.

While Cooper previously agreed that the environmental study was necessary for AAF’s second phase from Cocoa to Orlando if PABs were used for funding, he stated in his judgment that requiring the study is a case-by-case matter.

“Whether a particular PAB allocation constitutes ‘major federal action’ requiring compliance with [the National Environmental Policy Act] depends on a host of factors relating to the amount and nature of the federal assistance provided and the degree of control that federal agencies exercise over the project,” the judge stated in his order.

Both sides have hailed the order a victory.

“The ruling includes a severe warning to U.S. DOT should it issue another PAB request for the AAF project without first complying with the nation’s environmental laws: ‘if DOT were to do so, Plaintiffs could readily call it to the carpet by renewing their lawsuits in this Court,’ ” stated Brent Hanlon of Citizens Against Rail Expansion in Florida, which also opposes the trains, in a written statement.

In the meantime, AAF’s Brightline took delivery of two new trains that will provide service in South Florida later this year. Named BrightGreen and BrightOrange after the signature color schemes of the train cars, the sets were delivered simultaneously from Siemens Rolling Stock manufacturing hub in Sacramento, CA, according to a company statement.

They joined BrightBlue and BrightPink Saturday, May 13. Brightline trains are approximately 1,000 feet long. They are Buy America compliant, manufactured with components from more than 40 U.S. suppliers in 20 states. The trains are being held at Brightline’s 12-acre railroad operations facility in West Palm Beach.

“All Aboard Florida believes Judge Cooper properly dismissed the case, and we appreciate his thoughtful review and articulation of the facts and the law,” AAF officials said in a prepared statement. “We look forward to working with the Treasure Coast in a cooperative and more productive fashion as we advance this important infrastructure project.”

Phase 2 funding murky

Still murky is funding for Phase 2. In his order, Judge Cooper pointed out that obtaining additional funding from the U.S. government might be difficult due to the differences between former President Barack Obama and President Donald Trump.

“Any decision on a future application by AAF will be made by entirely different officials in the new administration. While the new administration has not publicly opined on the AAF project (as far as the Court is aware), its early actions with respect to publicly-funded rail transportation in general suggest that it might take a different track,” he wrote.

In his budget proposal to Congress, Trump would axe DOT’s Transportation Investment Generating Economic (TIGER) grants, which this fiscal year amounted to $500 million in grants across the country. Broward and Palm Beach counties were denied grants in 2014 for crossing improvements necessary for the railway tracks.

AAF stated it is evaluating several options for funding Phase 2 to Orlando.

Another Fortress company, Florida East Coast Railway, over whose tracks AAF’s trains will run, has been sold to Grupo Mexico Transportes. The $2.1-billion deal hinges on regulatory officials’ approval. Grupo Mexico has for years dominated the railway freight sector in Mexico, according to Reuters News Service.

And, Fortress itself was sold to Softbank, a Japanese telecommunications and technology conglomerate, in February. The deal, which as of Thursday May 25 had not closed, brought $3.3 billion.

However, according to The Straits Time, a Singapore-based media outlet, that transaction has not gone smoothly. On March 1, the Securities and Exchange Commission (SEC) froze assets of Maybank Kim Eng Securities, Singapore, and UK-based R.J. O’Brien Ltd.

The SEC is looking into charges of insider trading by customers of the two companies. Trades made just before Softbank announced the purchase produced $3.6 million in potentially illegal profits. Customers, who have been difficult to identify because they are masked in this type of trading, purchased the stock just prior to the Feb.14 offer, driving up stock prices by 28 percent. Buyers held the stock for just 24 hours before selling it for a profit.

AAF did not comment on whether or not the sale of the two companies would affect it. Instead, a spokesperson stated that it was “investing a significant amount on the extension to Orlando. We are in the process of finalizing the remaining permits and launching the South Florida segment in a few months.”

All Aboard Florida’s plan for passenger train service from Miami to Orlando in jeopardy

By Ann Henson Feltgen, FloridaBulldog.org all-aboard-florida

All Aboard Florida’s plan to operate regular passenger train service between Miami and Orlando is in jeopardy following a federal judge’s order questioning the company’s ability to borrow $1.75 billion in taxpayer-subsidized federal bonds to pay for the project.

At the same time, in a lawsuit filed by two Florida counties looking to block the project, the judge found that the U.S. Department of Transportation (DOT) ignored federal law when it issued bonding authority for Phase II of the private rail project from Cocoa to Orlando.

Another hearing in the case is set for Sept. 13, the same day DOT and All Aboard Florida (AAF) must file their formal answers to the complaint.

Phase l of the ambitious project, creating a passenger route and terminals at three stops along the Florida East Coast railroad line between Miami and Cocoa, is well underway. It is Phase II that is now precarious.

AAF, whose parent company – Florida East Coast Industries – is owned by the hedge fund Fortress Investment Group, approached the state more than two years ago with a plan to build and operate a privately owned railroad that would allow passengers to travel from Miami to Cocoa and from there to Orlando. AAF claims that trains would shave at least an hour off the drive time by car.

Railroad depots are under construction in Miami and Fort Lauderdale; a second set of tracks is being installed, and new engines and passenger cars are being built. AAF estimates that both phases will now cost more than $2.9 billion, excluding the cost of easements and land purchases it has already made.

But a lawsuit by Martin and Indian River counties, which challenged DOT’s bonding authority in federal court in Washington, D.C. in April 2015, has gained traction as their attorneys fended off DOT’s motion to dismiss the case while uncovering evidence that All Aboard Florida has little or no money in hand to begin Phase II construction.

Judge finds ‘legitimate questions’

On Aug. 16, after listening to both sides, U.S. District Court Judge Christopher R. Cooper said the evidence he saw raised “legitimate questions” about AAF’s commitment to Phase II without obtaining DOT’s private activity bonds.

Private activity bond-based “financing is not just the ‘current financing plan’ for the project – it appears to be the only financing plan,” the judge said.

Cooper’s finding allowed the two counties to continue to pursue their lawsuit alleging DOT violated the National Environmental Protection Act (NEPA) as well as federal law by approving $1.75 billion in tax-free bonds.

AAF, contacted several times by Florida Bulldog with requests for comment, did not respond. A U.S. Department of Transportation spokeswoman said the agency would not comment on pending litigation.

Any project that qualifies as a major federal action, which this project does according to the judge’s ruling, must comply with NEPA. The act provides for project reviews in this case by the Federal Railroad Administration, U.S. Army Corps of Engineers, U.S. Coast Guard, Federal Aviation Administration, Federal Highway Administration, U.S. Fish and Wildlife Service and the National Marine Fisheries Service.

An Environmental Impact Statement analyzes “a wide range of potential environmental and other consequences of the project and identified and evaluated measures that would avoid, minimize or mitigate impacts that would result from the project,” according to court documents.

A draft of that document was made public and comments taken, but then it was basically shelved, according to Indian River County Attorney Dylan Reingold.

“The evaluations were completed, but no record of decision was ever published,” said Reingold.

That action took place after AAF applied for a $1.6-billion loan through the Railroad Rehabilitation and Improvement Financing program in early 2014. Such loans are for the development and improvement of railroad tracks, equipment and facilities. The loan wasn’t approved, and AAF court filings say the company is no longer seeking that loan.

All Aboard Florida’s plan

In August 2014, AAF made another attempt at financing. It asked the U.S. Department of Transportation for $1.75 billion in tax-exempt bonds, which would mean up to $600 million in lost tax revenue over 10 years, according to court documents.

Four months later, DOT provisionally agreed to finance the $1.75 billion using tax-exempt private activity bonds (PABs). But the agency added several conditions, including a requirement that the bonds be sold by July 1, 2016, a deadline later extended to Jan. 1, 2017. The project must also complete the NEPA environmental review and prohibited from using the bond proceeds until 45 days following the issuance of the final environmental impact statement.

According to attorney Reingold, however, “they did this backwards. You have to go through a full NEPA analysis and Historic Preservation evaluation before authorizing allocation of funds.”

While DOT took the position that NEPA review was not required because the project is not a major federal action, Judge Cooper disagreed.

“The Court finds that the project does constitute major federal action,” he wrote in his ruling.

Without waiting for the NEPA findings, All Aboard Florida attempted three times last year to sell the bonds, each time with different terms, according to the judge’s findings. There were no takers, according to court records.

“NEPA is far more important than people realize,” said Steven Ryan, an attorney representing Martin County in this case. “This is a major procedural violation of environmental law.”

AAF initially told the court that it had $405 million in private debt funding held in escrow to begin construction of Phase II. In later court filings, however, AAF officials said that the $405 million is not for Phase II along with an apparent explanation of what the money is to be used for. The explanation was redacted from the public record.

That change was troubling for the court.

“Contrary to the court’s earlier understanding, [documents] do not show that AAF had already arranged financing for a significant portion of Phase II’s cost,” the judge wrote.

The need for taxpayer-subsidized bonds

AAF has said it can finance the project without government funding, yet also that it would be difficult if not impossible without the taxpayer-subsidized bonds.

AAF president Michael Reininger stated in a deposition that not approving the sale of the tax-exempt PABs “would certainly disrupt the current financing plan, make the project more expensive to complete and may delay its progress.”

In a letter to Paul Baumer of DOT’s Office of Infrastructure Finance and Innovation that emerged during discovery, Reininger went further, calling the funding a “linchpin for completing our project” and “a crucial factor in ensuring our project is financed and completed.”

According to The Bond Buyer.com, there is little interest in the market for high-risk, high-return bonds for a variety of reasons.

The owner of AAF’s parent company apparently cannot help. Court documents state that Fortress’ market capitalization has shrunk by nearly half in the past 14 months.

Likewise, Florida East Coast Investments, AAF’s parent company, has significant debt obligations coming due in three to four years, according to court documents.

While AAF appears to have no funding for Phase II, it does have equity in train stations, which it could sell, according to Ryan.

“You know, all along AAF has claimed that this is a private entity, but it is totally dependent on subsidies,” he said. “They should knock off this fiction. They have their hands in every government pocket they can find.”

Critics fault new highway law for concessions to trucking industry

By Brian Joseph, FairWarning bigtrucks

A $305 billion highway bill approved by Congress and signed by President Obama last week includes several provisions aggressively sought by the trucking industry that, critics say, will undermine traffic safety.

The long-awaited legislation – known as the Fixing America’s Surface Transportation, or FAST, Act – removes truck safety ratings from a public Department of Transportation website. It also creates a pilot program to put drivers as young as 18 behind the wheel of a big rig if they have received military training to operate a similar vehicle. The law also will slow efforts to raise the insurance requirements for big rigs, which have been required to carry a minimum of $750,000 in liability coverage since 1985.

(more…)

Heavy-spending trucking industry pushes Congress to relax safety rules

By Brian Joseph, FairWarning trucking

Big rig crashes kill nearly 4,000 Americans each year and injure more than 85,000. Since 2009, fatalities involving large trucks have increased 17 percent. Injuries have gone up 28 percent.

Given these numbers, you might expect Congress to be agitating for tighter controls on big rigs. In fact, many members are pushing for the opposite – looser restrictions on the trucking industry and its drivers. (more…)

Pipeline foes ask DEP to deny key permit; Cite ‘conflict of interest’ by Gov. Scott

By Dan Christensen, FloridaBulldog.org 

Gov. Rick Scott

Gov. Rick Scott

Opponents of a proposed natural gas pipeline in North Florida are asking Florida regulators to reject the project, citing both dangers to the environment and a “conflict of interest” by the regulators’ boss, Gov. Rick Scott.

The Florida Department of Environmental Protection announced in July its intention to award a crucial environmental permit and rights to drill beneath riverbeds that would allow Houston-based Spectra Energy (NYSE:SE) to construct the controversial, $3-billion Sabal Trail Transmission.

State records show Spectra Energy’s investors have included Gov. Scott.

On Friday, the nonprofit WWALS Watershed Coalition, an affiliate of the Waterkeeper Alliance, filed an amended petition asking the DEP to deny the permit or “at the very least” re-route the underground pipeline to avoid “the sensitive karst terrain that underlies north central Florida…especially drilling under the Withlacoochee, Suwannee and Santa Fe rivers.”

“The risk is not just to these waters…it is to the entire State of Florida whose growing population relies on the Floridan aquifer for much of its drinking water,” says the 34-page petition filed by WWALS president John S. Quarterman. The Floridan aquifer underlies all of Florida and parts of Alabama, Georgia and South Carolina.

Spectra Energy spokeswoman Andrea Grover, however, noted that DEP’s notice of intent to issue the permit followed nearly a year of discussions and review. “The permit requires full mitigation of all wetland impacts and protects water quality,” she said.

deplogoIf accepted as legally sufficient by DEP, the petition would put the brakes on the department’s plans to issue the permit and trigger an administrative hearing before any permit could be awarded. A DEP spokeswoman said Monday that the department’s lawyers are reviewing the petition.

The 474-mile Sabal Trail Transmission LLC is a joint venture of Spectra Energy Partners and Florida Power & Light parent NextEra Energy. It is intended to supply fracked natural gas to fuel a new generation of gas-fired power plants across the state, including Port Everglades.

Sabal Trail is to run across Alabama and through southern Georgia where it will enter Florida in d County. The Florida leg, 257 miles long, will push south through a dozen counties to a hub in central Florida south of Orlando. Along the way, the pipeline would be installed beneath several rivers.

‘REASONABLE ASSURANCE’

In the July 10 notice of intent, DEP Central District Director Jeff Prather wrote that Sabal Trail had provided DEP with “reasonable assurance” that pipeline construction would comply with state laws and rules. Likewise, Prather wrote, the department determined that “construction and operation” of the Sabal Trail pipeline would not violate state water quality standards.

“The applicant has also demonstrated that the construction…is clearly in the public interest,” Prather said.

The Federal Energy Regulatory Commission is the lead federal agency responsible for reviewing the Sabal Trail proposal and preparing an environmental impact statement. FERC’s decision could come as early as November.

The WWALS petition argues that the project is “clearly not in the public interest of the citizens of Hamilton and Suwannee counties who will be affected…without any benefit whatsoever.”

The petition describes the lands in north Florida along Sabal Trail’s proposed route as a rich habitat for native wildlife – including threatened species like the gopher tortoise and the eastern indigo snake.

The area is honeycombed with sinkholes and sensitive underground springs and caverns at special risk from the proposed, 36-inch natural gas pipeline. Forested lands will be cleared and wetlands filled to make way for the pipeline, substantially reducing wildlife habitat, a plan that is “not acceptable,” the petition says.

Schematic showing cross-section of the proposed HDD crossing of the Withlacoochee River and hypothetical karst features that could result in a hydrofracture (frac-out), significant loss in drilling fluid and potential loss of the borehole. Source: August 2014 report by geologist Robert Brown

Schematic showing cross-section of the proposed HDD crossing of the Withlacoochee River and hypothetical karst features that could result in a hydrofracture (frac-out), significant loss in drilling fluid and potential loss of the borehole. Source: August 2014 report by geologist Robert Brown

Drilling through the area’s karst terrain, formed by the gradual erosion of Florida’s limestone or dolomite rocks, could cause new sinkholes that could cause pipeline failure, property damage or even human injury, the petition says.

More ominously, the petition says the proposed use of Horizontal Directional Drilling (HDD) to bore through karst limestone in order to lay underground pipe at river crossings increases the risk of “frac-outs” that happen when a drill bores into an underground spring. The result can be a new sinkhole “resulting in potentially catastrophic effects on spring and river flows and water quality in both rivers and private wells.”

“This month another sinkhole opened just across the state line in Lowndes County, Georgia, threatening to absorb a road, as another did a few years ago,” the petition says. “Such sinkholes can form years after a pipeline is installed, as happened in Assumption Parrish, Louisiana in 2013 when Florida Gas Transmission had to move its pipeline.”

MORE STUDY NEEDED?

The petition calls for more study before such drilling “destroys underground caverns and spring conduits that may cause the extinction” of exotic species living in those caverns and springs.

Further, the petition cited the possibility of a pipeline failure and an explosion that would damage the underground karst terrain and springs and kill designated or threatened species like the alligator snapping turtle, American alligator and Suwannee cooter turtle.

The petition points out that a Spectra Energy pipeline exploded beneath the Arkansas River in Little Rock on May 31. It goes on to note that Spectra has been repeatedly fined by federal regulators in the U.S. and Canada for “failing to properly maintain and repair their pipelines and for failing to clean up contamination” when their pipelines leaked.

“Why is Florida DEP trusting this company with our valuable natural resources?” the petition asks.

With the Clinton Presidential Center in the foreground, this photo shows a Spectra Energy pipeline blowout beneath the Arkansas River in Little Rock on May 31. Photo Courtesy: Tony Cassady

With the Clinton Presidential Center in the foreground, this photo shows a Spectra Energy pipeline blowout beneath the Arkansas River in Little Rock on May 31. Photo Courtesy: Tony Cassady

Spectra Energy presents a different picture.

“Our safety record is better than the industry average,” said spokeswoman Andrea Grover. “Our reportable incidents were approximately half the rate of the industry average during the past five years.”

During the same period, Grover said, Spectra Energy operates about four percent of the nation’s natural gas transmission pipelines, yet received only two percent of the enforcement actions initiated by U.S. Department of Transportation’s Pipeline and Hazardous Materials Safety Administration.

Florida’s Department of Environmental Protection serves as staff to the Board of Trustees of the Florida Internal Improvement Fund, which owns the submerged lands beneath the rivers where Spectra Energy wants to run the pipeline. The DEP is delegated decision-making authority to issue an easement to allow construction under the Florida Administrative Code.

The WWALS petition says Gov. Scott, in his role as a member of the fund’s board of trustees, has a “conflict of interest” due to his “financial interests in Spectra Energy, the parent company of Sabal Trail Transmissions, as well as in Williams Company, the owner of the Transco pipeline from which Sabal Trail plans to get its gas.

“The governor and other public officials are prohibited by state ethics laws from owning stock in businesses subject to their regulation or that do business with state agencies,” the petition says.

In response, Scott’s office issued a statement saying the public is protected from conflicts of interests because his assets are in a blind trust “under the control of an independent financial professional. As such, the governor has no knowledge of anything that is bought, sold or changed in the trust.”

As FloridaBulldog.org has reported, however, the blind trust has not prevented public disclosure of Gov. Scott’s personal stock holdings. On June 25, for example, Scott and the trust reported to the U.S. Securities and Exchange Commission that Scott had sold 122,653 shares of Argan (NYSE:AGX) earlier that month for $4.87 million. Argan’s Gemma Power Systems subsidiary builds and operates power plants in Florida and elsewhere.

In March 2014, the Bulldog also reported that longtime Scott crony Alan Bazaar runs Hollow Brook Wealth Management, the trustee. Bazaar, who also manages another large Scott trust and family partnership, was a principal and a portfolio manager at the governor’s Naples-based investment firm for nearly 11 years before Scott ran for office.

Pipeline company with tie to Gov. Scott, and state backing, has history of accidents

By Dan Christensen, FloridaBulldog.org 

With the Clinton Presidential Center in the foreground, this photo shows a Spectra Energy pipeline blowout beneath the Arkansas River in Little Rock on May 31. Photo Courtesy: Tony Cassady

With the Clinton Presidential Center in the foreground, this photo shows a Spectra Energy pipeline blowout beneath the Arkansas River in Little Rock on May 31. Photo Courtesy: Tony Cassady

Spectra Energy, the company that state environmental regulators say should be allowed to construct a 267-mile-long natural gas pipeline in North Florida, has a checkered history of accidents and violations of federal safety rules in the U.S. and Canada dating back decades.

FloridaBulldog.org reported last week that Florida’s Department of Environmental Protection is backing the award of a key environmental permit for the controversial $3-billion Sabal Trail pipeline to a joint venture majority-owned by Houston-based Spectra Energy.

Spectra Energy’s investors have included Gov. Rick Scott. On last year’s financial disclosure form, Scott reported owning a $108,000 stake in Spectra and its affiliate, DCP Midstream Partners. His latest disclosure form, filed in June, no longer details Scott’s securities holdings because he put those assets into a blind trust.

The underground Sabal Trail Transmission is proposed as a nearly 500-mile interstate natural gas pipeline to run from Alabama, through Georgia south to Orange County, south of Orlando. Spectra owns 59.5 percent; Florida Power & Light parent NextEra Energy owns 33 percent; and Duke Energy, which spun off its natural gas business to form Spectra in 2007, recently paid $225 million for a 7.5 percent stake.

Federal and state election records show that FP&L, Duke Energy and their affiliates together have contributed $1.4 million to Let’s Get to Work, the political committee branded with Scott’s campaign slogan. They also gave a total of $5.8 million to the Republican Governors Association in 2013-14, which in turn contributed $18.3 million to Let’s Get to Work last year.

Gov. Rick Scott

Gov. Rick Scott

Spectra Energy operates approximately 22,000 miles of natural gas pipelines in North America. U.S. and Canadian agency files detail the company’s problematic safety record.

From 2006 to date, the U.S. Pipeline and Hazardous Materials Safety Administration recorded 25 incidents that caused more than $12 million in property damage along Spectra’s main line – the 9,000-mile Texas Eastern Transmission that connects Texas and the Gulf Coast with big urban markets in the Northeast. The causes ranged from equipment failure and incorrect operations to pipe corrosion.

The agency found numerous federal rules violations during the same period and slapped Spectra with a total of $400,000 in fines – not counting another $59,000 proposed penalty for failing to construct a pipeline in Pennsylvania in accordance with written specifications.

Spectra’s press office did not respond to detailed requests for comment made over two days.

Florida’s Department of Environmental Protection issued its July 10 notice of intent to issue the permit and easement for Sabal Trail without a public hearing. The WWALS Watershed Coalition, a Georgia based nonprofit and environmental advocate, filed an objection to the permit last week and the department is considering its response.

Was Spectra’s safety record considered in DEP’s decision?

“The department assesses a permit application based on Florida statutes and rules to ensure that all aspects of the proposed operation follow Florida law and are protective of the environment and human health and safety,” DEP spokeswoman Lori Elliott said in a Wednesday statement.

A DRAMATIC RUPTURE

Spectra’s most recent pipeline accident was the dramatic rupture of an auxiliary pipe along its Texas Eastern Pipeline in Little Rock, Ark. on May 31. The buried line, which crossed the Arkansas River near the Clinton Presidential Center, was not in use at the time, but contained four million cubic feet of natural gas that exploded with such force that churning water boiled up high into the air across the span of the river. Eyewitness Tony Cassady, who lives nearby, said the gushing waters had settled back somewhat by the time he managed to snap the photo above.

While no one was injured, the blow out resulted in more than $1 million in damages, according to federal records. The cause has not been determined, but an incident report filed by Spectra in June noted that high rains had caused flooding that had washed away soil that once covered the pipeline on the river’s bank.

Aerial view of the explosion site of Spectra Energy's Nig Creek Pipeline in 2012. Photo: Transportation Safety Board of Canada

Aerial view of the explosion site of Spectra Energy’s Nig Creek Pipeline in 2012. Photo: Transportation Safety Board of Canada

Another vivid example of the power of out-of-control natural gas occurred June 28, 2012 at the Nig Creek pipeline in British Columbia, operated by Spectra’s wholly owned subsidiary Westcoast Energy. The 16-inch pipeline, which had been shut down that night, was filled with pressurized “sour gas” that exploded when the line ruptured, causing a fire and creating a large crater in a remote forest area in British Columbia. Sour gas contains significant amounts of hydrogen sulfide and is highly toxic.

No one was injured in the blast – the nearest town, population 58, was 25 miles away. The cause was later determined to be a crack in a pipe.

So far in 2015, Canada’s National Energy Board has fined Spectra Energy three times for a total of $122,300 – including $88,000 imposed in January after inspectors found violations with “the potential to significantly impact worker safety and infrastructure” at Spectra’s Dawson Creek Gas Plant, also in British Columbia.

Just last month, the board also ordered Spectra to fix “management system failures” at its Westcoast Energy gas processing plants and facilities in western Canada after inspectors uncovered 27 safety issues between April 1, 2014 and June 26, 2015.

“The board expects Westcoast to address safety concerns on a systemic basis,” says the July 14 safety order. “Based on recent violations described below, the board is not confident safety concerns are being addressed in this manner.”

Back in the U.S., Spectra owns or co-owns eight natural gas pipelines, including the 745-mile Gulfstream Natural Gas, which runs beneath the Gulf of Mexico from lower Mississippi and Alabama to Tampa Bay. All but two of those pipelines – Gulfstream and the 67-mile Big Sandy pipeline in eastern Kentucky – have reported at least one incident since 2006.

Spectra Energy's pipelines

Spectra Energy’s pipelines

In 2014, the U.S. pipeline administration investigated a frightening episode in Searsmont, Maine involving the Maritimes and Northeast Pipeline, a joint venture of Spectra, Emera and ExxonMobil. The 684-mile pipeline transports natural gas from offshore Nova Scotia to markets in the northeast U.S.

The event happened at a pipeline compressor station, which helps move gas through a pipeline by keeping it under sufficient pressure, shortly before midnight on Dec. 31, 2013. Neighbors told a Bangor Daily News reporter they heard a roaring noise that was so loud it caused nearby homes to shake and some residents to flee.

“TERRIFYING EXPERIENCE”

“It was absolutely the most terrifying experience I’ve ever had,” Susan Totman told the newspaper.

Federal pipeline regulators said the noise, which lasted more than a half-hour, was caused by the release of gas jetting from a valve in an emergency shutdown system that was unintentionally opened. About 70 million cubic yards of gas were released, says an agency report on the incident.

The pipeline operator was later found to have violated federal regulations by failing to timely inform them of the accident. Last month, on July 24, regulators imposed a $34,500 fine that company officials did not contest.

Other Spectra pipelines have had problems, too.

Agency records list three incidents in 2010 involving equipment failure and excavation damage along Spectra’s East Tennessee pipeline that caused $238,000 in property damage. In 2013, the company received a warning letter after inspectors found four probable safety violations.

Spectra’s Southeast Supply Header is a 286-mile pipeline that funnels natural gas through Louisiana, Mississippi and Alabama to the Gulfstream pipeline and on to Florida. Records show that a construction-related equipment failure near Hazlehurst, Miss. in January 2010 caused $562,000 in property damage and led to $200,000 in safety violation fines.

But Spectra’s longest and most troubled pipeline is the Texas Eastern Transmission.

In 1989, Spectra and its Texas Eastern limited partnership paid a $15 million fine and entered into a consent decree with the Environmental Protection Agency to clean up PCB (polychlorinated biphenyl) contamination at numerous cites along the pipeline in 14 states.

Texas Eastern had used the banned substance and suspected carcinogen in its compressors as a fire retardant, and over time it had leaked into the pipeline system. The $500 million PCB cleanup cost included the assessment of 462 sites for contamination, installing 707 groundwater monitoring wells and removing and disposing of 600,000 tons of contaminated soil, the EPA said in a 2002 announcement that the cleanup had been completed.

Texas Eastern also paid Pennsylvania $218.6 million in penalties and costs to clean up 19 sites in that state where PCBs were dumped.

In 1994, a buried Texas Eastern pipeline in Edison, N.J. ruptured and ignited “sending flames several hundred feet in the air,” according to a National Transportation Safety Board report. Heat from the burning gas set fire to an apartment complex more than 100 yards away, destroying several buildings.

Dozens of people were injured and more than 100 families were left homeless, but there were no fatalities. Damage was estimated at $25 million. The probable cause of the rupture: mechanical damage to the pipe that created a crack that metal fatigue caused to grow to critical size.

Collision course: With wary eye on big trucks, bike riders seek safe space on city streets

By Bridget Huber, FairWarning truckcycle

On a July afternoon in New Orleans last year, Philip Geeck was riding his bicycle in a marked bike lane on a busy street. Approaching an intersection, he came up alongside a tractor-trailer truck hauling a tank of chemicals. Geeck, 52, was at the 18-wheeler’s midpoint when suddenly, without signaling, the truck began to turn right, witnesses say.

Victor Pizarro was driving nearby and watched in horror as the scene unfolded. He saw a look of confusion on Geeck’s face as the trailer came toward him. Geeck, an experienced cyclist known to his friends as “Geric,” tried to get away from the truck but couldn’t make it. First his wheel went beneath the semi’s enormous rolling tires, then his foot, then his entire body was dragged under. “It just kind of sucked him in,” Pizarro said in an interview. (more…)

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