Assembly Bill No. 535–Committee on Natural Resources, Agriculture, and Mining

(On Behalf of Commission on Workplace Safety)

March 15, 1999

____________

Referred to Committee on Commerce and Labor

 

SUMMARY—Expands and revises provisions governing regulation of facilities where highly hazardous substances are produced, used, stored or handled. (BDR 40-779)

FISCAL NOTE: Effect on Local Government: No.

Effect on the State or on Industrial Insurance: No.

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EXPLANATION – Matter in bolded italics is new; matter between brackets [omitted material] is material to be omitted. Green numbers along left margin indicate location on the printed bill (e.g., 5-15 indicates page 5, line 15).

 

AN ACT relating to public safety; providing for the registration and regulation of facilities that manufacture explosives for sale by the division of environmental protection of the state department of conservation and natural resources; requiring an assessment of risks through analysis of hazards to be conducted at a regulated facility where highly hazardous substances are located or explosives are manufactured for sale if such a substance or explosive is newly introduced into the facility; abolishing the requirement that the division establish a schedule for those assessments; providing penalties; and providing other matters properly relating thereto.

 

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

1-1 Section 1. Chapter 459 of NRS is hereby amended by adding thereto

1-2 the provisions set forth as sections 2 and 3 of this act.

1-3 Sec. 2. "Explosive" means gunpowders, powders used for blasting,

1-4 all forms of high explosives, blasting materials, fuses other than electric

1-5 circuit breakers, detonators and other detonating agents, smokeless

1-6 powders, other explosive or incendiary devices and any chemical

1-7 compound, mechanical mixture or device that contains any oxidizing and

1-8 combustible units, or other ingredients, in such proportions, quantities or

1-9 packing that ignition by fire, friction, concussion, percussion, or

1-10 detonation of the compound, mixture or device or any part thereof may

1-11 cause an explosion. The term includes any mixture of ammonium nitrate

2-1 and fuel oil. The term does not include any ammunition, powder,

2-2 percussion caps, fuses, quills, matches, primers or explosive materials

2-3 specified in 18 U.S.C. § 845(a)(4)-(6).

2-4 Sec. 3. 1. At least 60 days before a highly hazardous substance or

2-5 explosive is newly introduced into a regulated facility, the owner or

2-6 operator of the facility shall submit the facility to an assessment of risks

2-7 through analysis of hazards.

2-8 2. The owner or operator of a regulated facility shall not newly

2-9 introduce into the facility a highly hazardous substance or explosive:

2-10 (a) Until the recommendations in the plan to abate hazards proposed

2-11 by the person who conducted the assessment are carried out; or

2-12 (b) If written modifications are proposed to the plan to abate hazards,

2-13 until a plan to reduce accidents is issued by the division pursuant to NRS

2-14 459.386 and the owner of the facility complies with the requirements of

2-15 the plan.

2-16 Sec. 4. NRS 459.380 is hereby amended to read as follows:

2-17 459.380 The legislature hereby declares that the purposes of NRS

2-18 459.380 to 459.3874, inclusive, are to:

2-19 1. Protect the health, safety and general welfare of the residents of this

2-20 state from the effects of the improper handling of hazardous chemicals or

2-21 explosives at the point where [they] :

2-22 (a) The chemicals are produced, used or stored in this state; or

2-23 (b) The explosives are manufactured for sale in this state;

2-24 2. Ensure that the employees of this state who are required to work

2-25 with hazardous chemicals or explosives are guaranteed a safe and healthful

2-26 working environment;

2-27 3. Protect the natural resources of this state by preventing and

2-28 mitigating accidental or unexpected releases of hazardous chemicals into

2-29 the environment; and

2-30 4. Ensure the safe and adequate handling of [hazardous] :

2-31 (a) Hazardous chemicals that are produced, used, stored or handled in

2-32 this state [.] ; and

2-33 (b) Explosives that are manufactured for sale in this state.

2-34 Sec. 5. NRS 459.3802 is hereby amended to read as follows:

2-35 459.3802 As used in NRS 459.380 to 459.3874, inclusive, and

2-36 sections 2 and 3 of this act, unless the context otherwise requires, the

2-37 words and terms defined in NRS 459.3804 to 459.3812, inclusive, and

2-38 section 2 of this act, have the meanings ascribed to them in those sections.

2-39 Sec. 6. NRS 459.3808 is hereby amended to read as follows:

2-40 459.3808 "Hazard" means a characteristic of a:

2-41 1. Highly hazardous substance designated as such in NRS 459.3816 or

2-42 any regulations adopted pursuant thereto;

2-43 2. System involving the use of such a highly hazardous substance;

3-1 3. Manufacturing plant using or producing a highly hazardous

3-2 substance;

3-3 4. Regulated facility that manufactures explosives for sale; or

3-4 [4.] 5. Process relating to a highly hazardous substance,

3-5 which makes possible a chemical accident [.] or explosion.

3-6 Sec. 7. NRS 459.381 is hereby amended to read as follows:

3-7 459.381 "Regulated facility" means a building, equipment and

3-8 contiguous area where [highly] :

3-9 1. Highly hazardous substances are produced, used, stored or handled

3-10 [.] ; or

3-11 2. Explosives are manufactured for sale.

3-12 Sec. 8. NRS 459.3812 is hereby amended to read as follows:

3-13 459.3812 "Risk" means a risk posed by [a] :

3-14 1. A highly hazardous substance that is produced, used, stored or

3-15 handled at a regulated facility [.] ; or

3-16 2. An explosive that is manufactured for sale at a regulated facility.

3-17 Sec. 9. NRS 459.3813 is hereby amended to read as follows:

3-18 459.3813 1. Except as otherwise provided in this section and NRS

3-19 459.3814, the provisions of NRS 459.380 to 459.3874, inclusive, and this

3-20 section , and sections 2 and 3 of this act, apply to a regulated facility that

3-21 [produces,] :

3-22 (a) Produces, uses, stores or handles a highly hazardous substance in a

3-23 quantity:

3-24 [(a)] (1) Equal to or greater than the amount set forth in NRS 459.3816;

3-25 or

3-26 [(b)] (2) Less than the amount set forth in NRS 459.3816 if there are

3-27 two or more releases from the regulated facility of the same or different

3-28 highly hazardous substances during any 12-month period and:

3-29 [(1)] (I) The release of the highly hazardous substances is reportable

3-30 pursuant to 40 C.F.R. Part 302; or

3-31 [(2)] (II) Each quantity released is equal to or greater than a

3-32 maximum quantity allowable as established by regulation of the state

3-33 environmental commission [.] ; or

3-34 (b) Manufactures explosives for sale.

3-35 2. A regulated facility described in [paragraph (b)] subparagraph (2)

3-36 of paragraph (a) of subsection 1 is exempt from complying with the

3-37 provisions of NRS 459.380 to 459.3874, inclusive, and this section , and

3-38 sections 2 and 3 of this act, if:

3-39 (a) The division determines that the regulated facility has:

3-40 (1) Carried out the detailed plan to abate hazards recommended

3-41 pursuant to subsection [8] 3 of NRS 459.3852; and

4-1 (2) Complied with such other provisions of NRS 459.380 to

4-2 459.3874, inclusive, and this section, and sections 2 and 3 of this act, and

4-3 the regulations adopted pursuant thereto, as the division requires; and

4-4 (b) The regulated facility obtains an exemption from the state

4-5 environmental commission. The state environmental commission shall

4-6 adopt by regulation the procedures for obtaining such an exemption.

4-7 3. As used in this section, "highly hazardous substance" means any

4-8 substance designated as such in NRS 459.3816 or any regulations adopted

4-9 pursuant thereto.

4-10 Sec. 10. NRS 459.3824 is hereby amended to read as follows:

4-11 459.3824 1. The owner of a regulated facility shall pay to the

4-12 division an annual fee based on the fiscal year. The annual fee for each

4-13 facility is the sum of a base fee set by the state environmental commission

4-14 and any additional fee imposed by the commission pursuant to subsection

4-15 2. The annual fee must be prorated and may not be refunded.

4-16 2. The state environmental commission may impose an additional fee

4-17 upon the owner of a regulated facility in an amount determined by the

4-18 commission to be necessary to enable the division to carry out its duties

4-19 pursuant to NRS 459.380 to 459.3874, inclusive. The additional fee must

4-20 be based on a graduated schedule adopted by the commission which takes

4-21 into consideration the quantity of hazardous substances or explosives

4-22 located at each facility.

4-23 3. After the payment of the initial annual fee, the division shall send the

4-24 owner of a regulated facility a bill in July for the annual fee for the fiscal

4-25 year then beginning which is based on the applicable reports for the

4-26 preceding year.

4-27 4. The owner of a regulated facility shall submit, with any payment

4-28 required by this section, the number assigned by the department of taxation,

4-29 for the imposition and collection of taxes pursuant to chapter 364A of NRS,

4-30 to the business for which the payment is made.

4-31 5. All fees collected pursuant to this section and any interest earned

4-32 thereon must be deposited with the state treasurer for credit to the fund for

4-33 precaution against chemical accidents, which is hereby created as a special

4-34 revenue fund.

4-35 Sec. 11. NRS 459.3826 is hereby amended to read as follows:

4-36 459.3826 1. Each owner or operator of a new regulated facility shall,

4-37 within 10 days after the opening of the facility, tender the base fee and any

4-38 additional fee imposed by the state environmental commission of the state

4-39 department of conservation and natural resources pursuant to NRS

4-40 459.3824 for the first fiscal year with the form for registration of the

4-41 facility.

4-42 2. Each owner or operator of a regulated facility registering a new

4-43 highly hazardous substance or explosive at the facility shall tender the fee

5-1 computed from the inventory of the highly hazardous substance or

5-2 explosive when he registers the substance [.] or explosive.

5-3 Sec. 12. NRS 459.3828 is hereby amended to read as follows:

5-4 459.3828 1. The division shall develop and issue a form for

5-5 registration to be completed by the owner or operator of each facility in the

5-6 state which at any time [produces,] :

5-7 (a) Produces, uses, stores or handles any highly hazardous substance in

5-8 the quantity required to make it hazardous, or more [.] ; or

5-9 (b) Manufactures any explosive for sale.

5-10 2. This form must provide, in addition to any other information that

5-11 may be required by the division:

5-12 (a) A list of the highly hazardous substances produced, used, stored or

5-13 handled at the facility and the quantity of each, which must identify whether

5-14 those substances are end products, intermediate products, by-products or

5-15 waste products [;

5-16 (b) A] , if the facility produces, uses, stores or handles highly

5-17 hazardous substances;

5-18 (b) A list of the explosives manufactured for sale at the facility and the

5-19 quantity of each, if the facility manufactures explosives for sale;

5-20 (c) A general description of the process and principal equipment

5-21 involved in the management of the substances [;

5-22 (c)] or explosives;

5-23 (d) A description of the area in which the facility is situated, including

5-24 its proximity to population and water supplies;

5-25 [(d)] (e) The extent to which the hazards of the facility have been

5-26 identified, evaluated and abated, and the expert knowledge and affiliation

5-27 of the evaluators and any direct or indirect relationship between the

5-28 evaluators and the owner or operator of the facility; and

5-29 [(e)] (f) The name or names of all insurance carriers underwriting the

5-30 environmental liability of the facility and the scope of these policies,

5-31 including any limitations and exclusions.

5-32 [2. Within 90 days after a substance is added to the list of highly

5-33 hazardous substances and within 10 days after a listed substance is newly

5-34 introduced into a facility, the]

5-35 3. The owner or operator of the facility shall file with the division the

5-36 registration form developed and issued by the division and the report on

5-37 safety of the facility required by NRS 459.383 [.] :

5-38 (a) Not later than 90 days after a substance is added to the list of

5-39 highly hazardous substances, if the facility produces, uses, stores or

5-40 handles highly hazardous substances;

5-41 (b) Not later than 90 days after an explosive is added to the list of

5-42 explosives that are manufactured for sale at the facility, if the facility

5-43 manufactures explosives for sale;

6-1 (c) At least 90 days before a highly hazardous substance is newly

6-2 introduced into the facility, if the facility produces, uses, stores or

6-3 handles highly hazardous substances; and

6-4 (d) At least 90 days before an explosive is newly introduced into the

6-5 facility, if the facility manufactures explosives for sale.

6-6 Sec. 13. NRS 459.3836 is hereby amended to read as follows:

6-7 459.3836 1. [The] Except as otherwise provided in section 3 of this

6-8 act, the owner or operator of a facility shall submit the facility to an

6-9 assessment of risks through analysis of hazards at least every 5 years. The

6-10 assessment must be conducted by a person or persons who possess the

6-11 qualifications required pursuant to NRS 459.3842 and are selected by the

6-12 owner or operator with the approval of the division.

6-13 2. In addition to other duties deemed necessary by the owner or

6-14 operator or the division, the person conducting the assessment shall confirm

6-15 the accuracy of the facility’s current registration and report on safety.

6-16 3. The person conducting the assessment shall, at the conclusion of the

6-17 assessment, issue a report of findings, conclusions and recommendations.

6-18 One executed original of this report must be sent by the consultant directly

6-19 to the division.

6-20 Sec. 14. NRS 459.384 is hereby amended to read as follows:

6-21 459.384 1. The owner or operator of a regulated facility shall, [within

6-22 60 days after being notified by the division of the schedule established for

6-23 the facility pursuant to NRS 459.3838,] before submitting the facility to an

6-24 assessment of risks through analysis of hazards, designate a person or

6-25 persons who are capable of performing an assessment of risks through

6-26 analysis of hazards on its facility.

6-27 2. If any personnel of a regulated facility possess the necessary

6-28 qualifications to conduct the assessment, the owner or operator of that

6-29 facility may designate any of those persons to conduct the assessment.

6-30 3. Each person designated to conduct the assessment shall present

6-31 appropriate documentation demonstrating his ability to perform the

6-32 assessment. The documentation must include:

6-33 (a) The person’s qualifications in:

6-34 (1) Engineering related to chemical processes;

6-35 (2) Engineering related to safety;

6-36 (3) Preparation of operating procedures;

6-37 (4) Preparation or review of procedures for maintenance;

6-38 (5) Preparation or review of procedures for safety;

6-39 (6) Preparation or review of programs to train operators;

6-40 (7) Performance or review of investigations of accidents;

6-41 (8) Performance of analyses of hazards;

6-42 (9) Performance of risk assessments of risk;

6-43 (10) Preparation or review of plans for response to emergencies;

7-1 (11) Performance of audits of programs to manage risks; and

7-2 (12) Knowledge of the state of the art as it relates to the technology of

7-3 the processes used;

7-4 (b) The qualifications and experience of additional personnel who may

7-5 be assigned as needed; and

7-6 (c) The level of effort to be dedicated and a schedule, including the total

7-7 time, for performing the assessment, including the following:

7-8 (1) Names of personnel assigned;

7-9 (2) Expected dates of starting and completion;

7-10 (3) Estimated total hours for all personnel; and

7-11 (4) Scope and extent of usage of collateral items such as computers

7-12 and outside consultants.

7-13 Sec. 15. NRS 459.3848 is hereby amended to read as follows:

7-14 459.3848 The findings of the person who conducted the assessment

7-15 must include, without limitation:

7-16 1. The identity and quality of all highly hazardous substances

7-17 produced, used, stored, handled, or that could unwittingly be produced in

7-18 the event of a breakdown of equipment, human error, defect in design or

7-19 procedural failure, or the imposition of an external force;

7-20 2. The identity and quantity of all explosives that are manufactured

7-21 for sale at the regulated facility;

7-22 3. The nature, age and condition of all of the equipment and

7-23 instruments [involved in the handling and management of] used to handle

7-24 and manage a highly hazardous substance or explosive at the regulated

7-25 facility, and the schedules for [their] the testing and maintenance [;

7-26 3.] of the equipment and instruments;

7-27 4. The measures and precautions designed to protect against the

7-28 intrusions of internal or external forces and events [,] or to control or

7-29 contain discharges within the regulated facility;

7-30 [4.] 5. Any training or managerial practices in place which impart

7-31 knowledge to appropriate personnel regarding the dangers posed by a

7-32 release of a highly hazardous substance or a discharge of an explosive and

7-33 the training provided to prepare [them] those personnel for the safe

7-34 operation of the facility and for unanticipated occurrences;

7-35 [5.] 6. Any other preventive maintenance, capability to respond at the

7-36 regulated facility to an emergency [,] or other internal mechanism

7-37 developed to safeguard against the occurrence of an accidental release of a

7-38 highly hazardous substance or accidental discharge of an explosive or any

7-39 other aspect or component of the facility deemed relevant by the division;

7-40 [6.] 7. The practices, procedures and equipment designed to forestall a

7-41 hazard at the [covered] regulated facility; and

7-42 [7.] 8. Any other information which is relevant to carry out the

7-43 purposes of the report.

8-1 Sec. 16. NRS 459.385 is hereby amended to read as follows:

8-2 459.385 The conclusions of the person who conducted the assessment

8-3 must include, without limitation:

8-4 1. The nature and magnitude of any hazard at the regulated facility;

8-5 2. The likelihood of a chemical accident resulting from the hazard at

8-6 the regulated facility;

8-7 3. The circumstances that would result in a discharge of a highly

8-8 hazardous substance or explosive at the regulated facility;

8-9 4. The effectiveness of the systems and procedures for safety at the

8-10 regulated facility and for the control of any hazards; and

8-11 5. Any other information which is relevant for the purposes of the

8-12 report.

8-13 Sec. 17. NRS 459.3852 is hereby amended to read as follows:

8-14 459.3852 The recommendations of the person who conducted the

8-15 assessment must include, without limitation, the following information if

8-16 applicable to the facility:

8-17 1. Alternative processes, procedures or equipment which [might] may

8-18 reduce the risk of a release of a highly hazardous substance or a discharge

8-19 of an explosive at the regulated facility while yielding the same or

8-20 commensurate results;

8-21 2. The [need] requirement for :

8-22 (a) A change in a process;

8-23 [3. The need for a]

8-24 (b) A chemical substitution or change;

8-25 [4. The need for]

8-26 (c) Any additional safety equipment;

8-27 [5. The need for a mitigation system;

8-28 6. The need for]

8-29 (d) A mitigation system;

8-30 (e) Any additional preventive maintenance or responses at the regulated

8-31 facility to emergencies, to safeguard against a hazard;

8-32 [7. The need for] and

8-33 (f) Any additional planning near the regulated facility to meet

8-34 emergencies;

8-35 [8.] 3. A detailed plan to abate hazards suitable for adoption as an

8-36 accident reduction plan to reduce accidents; and

8-37 [9.] 4. Any other information which is relevant for the purposes of the

8-38 report.

8-39 Sec. 18. NRS 459.3872 is hereby amended to read as follows:

8-40 459.3872 1. If any person violates any of the provisions of NRS

8-41 459.380 to 459.386, inclusive, or 459.387, or section 3 of this act, or any

8-42 regulation or order adopted or issued pursuant thereto, the division may

8-43 institute a civil action in a court of competent jurisdiction for injunctive or

9-1 any other appropriate relief to prohibit and prevent the violation and the

9-2 court may proceed in the action in a summary manner.

9-3 2. Except as otherwise provided in NRS 445C.010 to 445C.120,

9-4 inclusive, a person who violates a provision of NRS 459.380 to 459.386,

9-5 inclusive, or 459.387, or section 3 of this act, or any regulation or order

9-6 adopted pursuant thereto is liable to a civil administrative penalty as set

9-7 forth in NRS 459.3874. If the violation is of a continuing nature, each day

9-8 during which it continues constitutes an additional, separate and distinct

9-9 offense. No civil administrative penalty may be levied until after

9-10 notification to the violator by certified mail or personal service. The notice

9-11 must include a reference to the section of the statute, regulation, order or

9-12 condition of a permit violated, a concise statement of the facts alleged to

9-13 constitute the violation, a statement of the amount of the civil penalties to

9-14 be imposed, and a statement of the violator’s right to a hearing. The

9-15 violator has 20 days after receipt of the notice within which to deliver to the

9-16 division a written request for a hearing. After the hearing if requested, and

9-17 upon a finding that a violation has occurred, the administrator of the

9-18 division may issue a final order after assessing the amount of the fine

9-19 specified in the notice. If no hearing is requested, the notice becomes a

9-20 final order upon the expiration of the 20-day period. Payment of the penalty

9-21 is due when a final order is issued or when the notice becomes a final order.

9-22 The authority to levy a civil administrative penalty is in addition to all other

9-23 provisions for enforcement of NRS 459.380 to 459.387, inclusive, and the

9-24 payment of a civil administrative penalty does not affect the availability of

9-25 any other provision for enforcement in connection with the violation for

9-26 which the penalty is levied.

9-27 Sec. 19. NRS 459.3874 is hereby amended to read as follows:

9-28 459.3874 1. The civil administrative penalties are:

9-29 Category of Offense Penalty in U.S. Dollars

9-30 A. Failure to register a new or existing regulated

9-31 facility: $25,000 plus $2,000 per day

9-32 from the due date

9-33 B. Failure to pay [annual fee:] the fee required

9-34 pursuant to NRS 459.3824: 75 percent of the fee

9-35 C. Failure to submit a safety report: $10,000 plus $1,000 per day

9-36 from the due date

9-37 D. Failure to conduct an assessment of risk

9-38 through analysis of hazards pursuant to the

9-39 conditions set forth in NRS 459.3844: $25,000

9-40 E. Failure to put into effect plan: $50,000

10-1 F. Failure to comply with plan to reduce

10-2 accidents and schedule of compliance: up to $5,000

10-3 G. Failure to comply with approved plan to

10-4 reduce accidents, each requirement: up to $10,000

10-5 H. Failure to provide information requested by

10-6 the division: $25,000

10-7 I. Failure to grant access to employees or agents

10-8 of division for inspections: $25,000

10-9 J. Failure to provide information or grant access

10-10 to employees or agents of division during

10-11 an emergency: $50,000

10-12 K. Falsification of information submitted to

10-13 division: up to $10,000 per incident

10-14 2. The division may compromise and settle any claim for any penalty

10-15 under this section in such amount in the discretion of the division as may

10-16 appear appropriate and equitable under all of the circumstances, including

10-17 the posting of a performance bond by the violator. If a violator is subject to

10-18 the imposition of more than one civil administrative penalty for the same

10-19 violation, the division shall compromise and settle the claim for the penalty

10-20 under this section in such amount as to avoid the duplication of penalties.

10-21 3. No penalty may be imposed pursuant to this section for the failure to

10-22 perform a required act within the time required if the delay was caused by a

10-23 natural disaster or other circumstances which are beyond the control of the

10-24 violator.

10-25 4. Any person who violates any of the provisions of NRS 459.380 to

10-26 459.386, inclusive, or 459.387, or section 3 of this act, or any regulation or

10-27 order adopted or issued pursuant thereto, or an administrative order issued

10-28 pursuant to subsection 2 of NRS 459.3872 or a court order issued pursuant

10-29 to subsection 1 of NRS 459.3872, or who fails to pay a civil administrative

10-30 penalty in full is subject, upon order of the court, to a civil penalty not to

10-31 exceed $10,000 per day of the violation, and each day’s continuance of the

10-32 violation constitutes a separate and distinct violation. Any penalty imposed

10-33 pursuant to this subsection may be recovered with costs in a summary

10-34 proceeding by the attorney general.

10-35 Sec. 20. NRS 459.3838 is hereby repealed.

10-36 Sec. 21. The amendatory provisions of this act do not apply to

10-37 offenses that were committed before October 1, 1999.

 

11-1 TEXT OF REPEALED SECTION

 

11-2 459.3838 Schedule for assessments; establishment of priority

11-3 system.

11-4 1. Within 60 days after receiving a completed form for registration and

11-5 the annual fee from the owner or operator of a facility, the division shall

11-6 establish for that facility a schedule for the assessment of risks through the

11-7 analysis of hazards which is based on a priority system that is established

11-8 considering the volume of hazardous substances at the facility and the

11-9 population potentially affected by those substances.

11-10 2. The state environmental commission of the state department of

11-11 conservation and natural resources shall adopt regulations for the

11-12 establishment of a priority system.

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