Speeches/Testimony

National Petrochemical and Refiners Association Comments on U.S. Department of Transportation--Coast Guard Notice on Maritime Security Docket USCG-2002-14069 February 11, 2003 New York, New York

Presented by William R. Koch, Air Products & Chemicals, Inc.

Good afternoon. My name is William Koch, and I am pleased to be able to speak to you today on behalf of the National Petrochemical & Refiners Association, or NPRA, in Washington, D.C. I am the Global Director of Process Safety Integrity with Air Products & Chemicals, Inc., in Allentown, Pennsylvania. My position was created following 9-11 to facilitate worldwide coordination and implementation of enhanced security for Air Products people and facilities throughout the world. I was a member of the American Chemistry Council (ACC) and Center for Chemical Process Safety (CCPS) Security Task Forces that developed a Security Vulnerability Assessment (SVA) criteria and methodology for the Chemical Industry, am Chairman of the Compressed Gas Association (CGA) Security Committee, and am here today as a member of the NPRA Security Committee. The National Petrochemical & Refiners Association is a national trade association whose members include virtually all of the refiners and petrochemical manufacturers in the United States.

NPRA intends to submit written comments for the record before the comment period closes, so I will be limiting my remarks today to just a few of the most important issues which we feel the interim final regulations should address.

Let me begin, if I may, by making one thing perfectly clear: NPRA and its members are absolutely committed to keeping all of our facilities as secure as possible from threats of violence or terrorism; and to working in complete harmony with local, state, and federal agencies and departments in maintaining and strengthening the critical petrochemical energy infrastructure of our country; and to protecting the safety of all those people who work for us and all those whom we serve.

We do have several matters we would like to discuss today.

First, we hope the regulations to be issued in June will answer the question, "Who's in charge of Security for our industry?" Specifically, who has jurisdiction - who has regulatory authority - for the conduct of facility Security Vulnerability Assessments and security plans at refineries and petrochemical plants? In the past few months, our companies have been visited by the Environmental Protection Agency, the Department of Energy, U.S. Customs, the FBI, the National Guard, the General Accounting Office, and various state and local agencies, and, last, but by no means least, the U.S. Coast Guard. While we of course want to be as cooperative as possible with all of these agencies, I will have to say here that this situation must be improved.

Some of these visitors, of course, have been most helpful. But facility security is not enhanced when our facility personnel are kept so busy responding to repetitive requests for information.

Specifically, let me ask: if the Coast Guard requires a facility security assessment, or FSA, to be done at a given site, will EPA be able to require the same thing? Will DOE or DHS? Will a federally mandated FSA by one department - and submitted to that department for approval -- relieve a facility of providing the same information to another department, or agency?

Further - and this brings me to my second major area of concern - if the Coast Guard does conduct an FSA, will the information derived therefrom be kept confidential? Will it be subject to a Freedom of Information Request by parties whose interests are not in maintaining security, but in publishing the details of our operations to the world?

We believe that the Maritime Transportation Security Act gives the Coast Guard the authority to make sure the information is kept secure. Title 46 of the U.S. Code, Section 70103(d), now says:

Notwithstanding any other provision of law, information developed under this chapter is not required to be disclosed to the public . . . .

As we read this, the Coast Guard can write its regulations so as to protect the data submitted pursuant to the FSA and FSP requirements of the MTSA and preclude unnecessary and, indeed, potentially disastrous disclosure to anyone without a legitimate "need to know."

Our position in this regard is bolstered by the provision to this effect in the Homeland Security Act of 2002. Section 214 of the Act (6 USC § 133) provides that information that is voluntarily submitted to the Department of Homeland Security regarding the security of critical infrastructure shall be exempt from disclosure under the Freedom of Information Act. Clearly, the intent here is to encourage the submission of security information to DHS with the promise that the information will be kept confidential. We urge the Coast Guard to write its regulation so as to bring its policies, practices, and procedures into line with those of its parent department, and to leave no doubt that the Coast Guard will make the confidentiality of the information it receives a matter of highest priority.

This need for clarity brings me to the third item I would like to address. How broadly is the Coast Guard going to interpret its jurisdictional authority? The Maritime Transportation Security Act defines a "facility" as a "structure or facility of any kind located in, on, under or adjacent to waters subject to the jurisdiction of the United States." That includes just about every structure here on Manhattan Island. Certainly we have buildings here, including this one, that are subject to a "substantial threat" of being involved in a transportation security incident that could result in a "significant loss of life . . . or economic disruption."

Not long ago a representative of the Coast Guard visited a facility located in a small Midwestern town a good two miles from the nearest body of water. The young man declared that, because that facility received cargo trucked to it from a port at that body of water two miles away, the entire facility was subject to Coast Guard jurisdiction.

The preamble in the December 30 notice says that "the Coast Guard is considering requiring FSAs for all facilities" that "handle dry bulk or general cargo." How many tens of thousands - or hundreds of thousands -- of submissions by facilities or structures will the Coast Guard be able to review?

Finally - and I think this needs to be clearly understood - the refining and petrochemical manufacturing industries have already taken major strides in maintaining and strengthening facility security, and any regulation should be fashioned so as to give credit for the work already done. I know that you recognize that industry has not been standing idly by, waiting for federal legislation or regulations to be adopted, before our companies started doing security vulnerability assessments. Much was done prior to 9/11, and much more of course has been done since that attack took place not far from here. Several private and public organizations have vulnerability assessment methodologies to which our members subscribe, and we would hope your regulation will give credit for the work that has already been done.

NPRA looks forward to working with the Coast Guard as this important process continues.