HMS Legal Blog

            On August 11, 2016, The PUC acting pursuant to Act 85 of 2016, which requires the PUC to promulgate new regulations in response to changes in the industry, requested public comment on ride sharing companies such as Uber and Lyft.  Uber and Lyft have spurred and created controversy  in both the Public Utility Commission (PUC)  and Commonwealth Courts.  The PUC requested comments include “specific suggestions for any proposal, including suggested regulatory language, with appropriate citations to current regulations that address the particular comment.  Additionally, comments must provide the underlying rationale to support any suggested temporary regulations.”  Comments are due 30 days from publication in the Pennsylvania Bulletin, which is published each Saturday.  The rulemaking is docketed at L-2016-2556432.

       On August 1, 2016, The Pennsylvania Department of Environmental Protection (DEP) released its 2015 Oil and Gas Annual Report (Report).[1]  In additional to natural gas production details, the Report provides information on natural gas data trends in Pennsylvania and details on DEP inspections.  2015 was a difficult year for the natural gas industry as it faced record inventory levels, declining prices, and decreases in newly drilled wells.[2]  DEP confirms Pennsylvania was not immune to the national downturn in natural gas drilling with only 1,070 newly drilled wells in 2015 – more than a 50% decrease from the 2,163 new wells drilled in 2014.[3]

            On June 30, 2016, at its most recent public meeting, the Pennsylvania Public Utility Commission (“Commission”) set a precedent important to Pennsylvania Uber (operating in Pennsylvania under its subsidiary Raiser-PA) and Lyft users alike by granting Yellow Cab Company of Pittsburgh, Inc. (“Yellow Cab”), a temporary extension of one year of operating authority to provide Transportation Network Service (“TNC”) in Pennsylvania.[1] Although Yellow Cab may no longer be a household name like Uber and Lyft, the service that it provides is identical. In fact, Yellow Cab was the first Transportation Network Service (“TNC”) or app-based transportation provider that was granted temporary authority to operate in Pennsylvania.[2] But under the Commission’s regulations, TNC authority is considered “experimental” and therefore is temporary and only valid for two years.[3] Yellow Cab was granted authority to operate beginning in July 2014 and without the Commission’s June 30^th Order, it would have been required to cease operating on July 1, 2016.

When Pennsylvania’s Independent Regulatory Review Commission (“IRRC”) voted unanimously at its June 30, 2016 meeting to disapprove for a second time the Pennsylvania Public Utility Commission’s (“PUC”) recent efforts to modify its regulations implementing the Alternative Energy Portfolio Standards(“AEPS”) Act,[1] it was aware that its action would at most place a speed bump in the PUC’s path, but it disapproved the regulations anyway. 

On June 29, 2016, President Obama, Prime Minister Trudeau, and President Nieto announced the North American Climate, Clean Energy, and Environment Partnership at the North American Leaders Summit.  According to President Obama, the “ambitious and enduring” Partnership will see the United States, Canada, and Mexico “work toward the common goal of a North America that is competitive, that encourages clean growth, and that protects our shared environment.”[1]

Yesterday, President Obama signed into law the “Protecting our Infrastructure of Pipelines and Enhancing Safety” (PIPES) Act.  This bi-partisan bill was the culmination of efforts by both the Energy and Commerce Committee and the Transportation and Infrastructure Committee.  This Act is intended to increase the efficiency and transparency of the Pipeline and Hazardous Materials Safety Administration (PHMSA) while enlarging safety inspections and audits of the natural gas pipeline industry.

     On June 2, 2016 the Independent Regulatory Review Commission (“IRRC”) appropriately voted 5-0 to disapprove the Pennsylvania Public Utility Commission’s (“PUC”) attempt to modify its regulations implementing the Alternative Energy Portfolio Standards (“AEPS”) Act, 73 P.S. §§1648.1, et seq.  The IRRC’s rejection was based primarily on its view that the PUC’s proposed regulations would exceed its statutory authority by limiting net-metering of electricity to entities with alternative energy systems sized to generate no more than 200% of their annual consumption.  The IRRC went on to state that if the PUC decides to proceed with the rulemaking by deleting this limit, it “should ensure that other provisions of the regulation do not limit a customer-generator’s ability to net-meter excess generation it produces.”  The IRRC also found that the PUC had failed to show any need for the modifications and suggested that because the PUC’s proposal appeared to be a change in policy of such a substantial nature consultation with the General Assembly was warranted.

Tuesday night, the U.S. Senate passed the Protecting our Infrastructure of Pipelines and Enhancing Safety Act (PIPES Act).  This bill is now headed to President Obama to be signed into law.  In addition to reauthorizing the U.S. Department of Transportation’s Pipeline and Hazardous Materials Safety Administration (PHMSA) through FY2019, this soon-to-be law enacts substantive changes in the pipeline industry’s regulatory landscape.

            In an April 19, 2016 Opinion, the Pennsylvania Commonwealth Court[1] affirmed the Public Utility Commission’s (PUC) grant of a certificate of public convenience (CPC) for experimental authority to operate as a common carrier to Raiser-PA, LLC (Raiser) in Pennsylvania, excluding Philadelphia.[2]  Raiser is a subsidiary of Uber Technologies, Inc. (Uber), which licenses the technology to Raiser that allows users to request a ride via smartphone app. 

            On March 17, 2016 Pipeline and Hazardous Materials Safety Administration (PHMSA) released a 549 page Notice of Proposed Rulemaking (NPRM) that significantly changes regulations for transmission lines and imposes regulations on previously unregulated gathering lines carrying, inter alia, natural gas and petroleum products. 

Public Utility Commission (PUC) Commissioners gave Sunoco Pipeline a fighting chance at exemption from local zoning for outbuildings housing utility structures on the Mariner East Pipeline, finding prima facie evidence that Sunoco is a public utility and overruling the ALJs’ July 23, 2014 Initial Decision granting preliminary objections finding to the contrary. 

A government body subject to the Sunshine Act’s requirement of public decision-making is free to engage in non-public information gathering sessions, including private meetings with opposing parties in ongoing litigation in which a quorum of the agency members participate, so long as the actual decision-making, or “deliberation” takes place at a public meeting, the Supreme Court has ruled. In Smith v. Township of Richmond 34 MAP 2013, __A.3d __ (December 16, 2013), the Pennsylvania Supreme Court “allowed appeal on a limited basis to examine whether the Sunshine Act’s definition of ‘deliberations’ is implicated where… an agency meets with various parties – including opposing parties in litigation – to obtain information designed to help the agency make a more informed decision with regard to settling the ongoing litigation.” In finding no violation and permitting the fact-finding sessions, the Court affirmed the decisions of the Commonwealth Court and the trial court.

Jersey and New York gasoline distributors continue to struggle to supply gas stations with diesel and gasoline product while federal and state legislatures both suspend and invoke regulations in order to assist and police gasoline distributors.

On January 3, 2012, the Pennsylvania Department of Agriculture (PDA) issued a Special Bulletin extending the deadline for persons who own fuel oil delivery trucks to comply with section 3.31 of the National Institute of Standards and Technology (NIST) Handbook 44.  Section 3.31 of NIST requires installation of special equipment on fuel oil delivery trucks so that proper testing can be performed for temperature adjusted product.  The deadline for the installation of this equipment has been extended from July 1, 2011 to October 1, 2012.

In a case arising from the award of the contract for the Gaming Board/Department of Revenue’s Central Computer Control System that monitors transactions in slot machines in Pennsylvania’s casinos, the Commonwealth Court has ruled that a claim based on a contract that seeks relief that is nonmonetary in nature (i.e., for declaratory relief and specific performance) can proceed directly in the Commonwealth Court.  Scientific Games International, Inc. v. Commonwealth, __ A. 3d __ (380 M.D. 2011, filed Nov. 30, 2011).

Interpreting the “conflict of interest” provisions of Pennsylvania’s Ethics Act, the Supreme Court has ruled that “to violate the conflict of interest provision … a public official must be consciously aware of a private pecuniary benefit for himself, his family, or his business, and then must take action in the form of one or more specific steps to attain that benefit.”  Kistler v. State Ethics Comm’n,  __Pa. __, ___A. 2d ___ (2011) (59 MAP 2009, decided June 22, 2011).

Hawke McKeon and Sniscak LLP, is pleased to announce the expansion of its insurance regulatory practice, with Christopher J. Knight joining the firm as Of Counsel.

Chris spent nearly nine years as Counsel for the Pennsylvania Insurance Department as a member of the Governor’s Office of General Counsel, and will now use that experience and knowledge in his representation of insurance companies, producer licensees and other insurance-entity clients in regulatory, licensing and government compliance matters and related litigation.

Finding “clearly unreasonable” the Pennsylvania State Harness Racing Commission’s denial of flat track Philadelphia Park’s motion to intervene in harness track Harrah’s Chester’s telephone account wagering application, the en banc Commonwealth Court reversed the denial of intervention and also (in order to “right the wrong”) vacated the Commission’s order allowing Harrah’s Chester to commence operations of the new remote wagering system. Bensalem Racing Association, Inc.v. Pennsylvania State Harness Racing Commission, _A.3d ___(Pa. Cmwlth. 2011) (en banc) 1053 and 2710 C.D. 2010,
filed March 21, 2011) (Brobson, J.).

Valley Forge Convention Center is a “well established resort hotel” that otherwise meets statutory licensing requirements for receipt of a Category 3 slots license, the Pennsylvania Supreme Court held in a 3-2 decision upholding the Gaming Board.