TITLE 16.ECONOMIC REGULATION

Part 1. RAILROAD COMMISSION OF TEXAS

Chapter 7. GAS SERVICES DIVISION

Subchapter I. NATURAL GAS PIPELINE COMPETITION

16 TAC §7.7201

The Railroad Commission of Texas proposes new §7.7201, relating to the Natural Gas Pipeline Competition Study Advisory Committee, which is proposed to be in new Subchapter I entitled "Natural Gas Pipeline Competition." Pursuant to the requirements of Texas Government Code, §§2110.001 - 2110.008, the new section creates the Natural Gas Pipeline Competition Study Advisory Committee of the Commission and establishes its duration; sets forth the purpose and tasks of the committee; prescribes the nomination and appointment process; and sets forth the mechanisms by which the committee reports to the Commission.

Proposed new §7.7201 creates the Natural Gas Pipeline Competition Study Advisory Committee, effective April 1, 2006, and abolishes it on December 31, 2006, unless the Commission amends the rule to change that date. The purpose of the committee is to give the Commission the benefit of the members' collective business, technical, and operating expertise and experience to help the Commission review competition in the Texas intrastate natural gas pipeline industry, assess the effect of current statutes and rules on competition, and develop recommendations for changes to statutes or rules that may be necessary. The Commission will not reimburse members for travel or other expenses related to service on the committee.

The Advisory Committee will exist until December 31, 2006, unless the Commission amends the rule to change the date of its abolition. Steve Pitner, Director, Gas Services Division, has determined that for each year of the first five years the new section is in effect, there will be negligible fiscal implications for state government as a result of enforcing or administering the section. The amount of staff time spent in support of the Natural Gas Pipeline Competition Study Advisory Committee, as provided in the proposed rule, will be minimal and will be provided within the existing Gas Services Division staffing and budget.

There will be no fiscal implications for local governments. There is an anticipated economic cost to small businesses, micro-businesses, and to individuals, but only to those small business and micro-business owners or individuals who are members of the Natural Gas Pipeline Competition Study Advisory Committee. Due to the nature of the rule's provisions, however, the amount of that cost cannot be determined. The anticipated economic cost arises from the provision that the Commission will not reimburse advisory committee members for travel or other expenses related to service on the committee. Such expenses are likely to be different for each committee member. Because membership on the committee is voluntary, none of the anticipated cost is mandatory.

Mr. Pitner has also determined that for each year of the first five years the section is in effect the public benefit anticipated as a result of enforcing the section will be the creation of a network through which the Commission will obtain information needed to determine the nature of competition in the natural gas pipeline industry, to assess the effect of current statutes and rules on competition in the industry, and to develop recommendations for changes that may be necessary to statutes or rules.

Comments on the proposal may be submitted to Rules Coordinator, Office of General Counsel, Railroad Commission of Texas, P.O. Box 12967, Austin, Texas 78711-2967; online at www.rrc.state.tx.us/rules/commentform.html; or by electronic mail to rulescoordinator@rrc.state.tx.us. The Commission will accept comments for 7 days after publication in the Texas Register and should refer to Gas Utilities Docket No. 9637. The Commission encourages all interested persons to submit comments no later than the deadline. The Commission cannot guarantee that comments submitted after the deadline will be considered. For further information, call Steve Pitner at (512) 463-7938. The status of Commission rulemakings in progress is available at www.rrc.state.tx.us/rules/proposed.html.

The Commission proposes the new section under Texas Natural Resources Code, §81.052, which gives the Commission the authority to adopt all rules necessary for governing and regulating persons and their operations under the jurisdiction of the Commission, Article VI, Railroad Commission, Section 16, Appropriations Act, 2006 - 2007 Biennium, 79th Legislature, Regular Session, 2005, which requires the Commission to conduct a study that determines the extent to which competition exists in the Texas natural gas pipeline industry, Texas Government Code, §2001.031, which authorizes the Commission to appoint advisory committees to advise the Commission about contemplated rulemaking, and Texas Government Code, §§2110.001 - 2110.008, which mandate specific requirements for state agency advisory committees.

Article VI, Railroad Commission, Section 16, Appropriations Act, 2006 - 2007 Biennium, 79th Legislature, Regular Session, 2005, Texas Government Code, §2001.031, and Texas Government Code, §§2110.001 - 2110.008, are affected by the proposed new section.

Statutory authority: Texas Natural Resources Code, §81.052; Article VI, Railroad Commission, Section 16, Appropriations Act, 2006 - 2007 Biennium, 79th Legislature, Regular Session, 2005; and Texas Government Code, §2001.031, and §§2110.001 - 2110.008.

Cross-reference to statutes: Texas Natural Resources Code, §81.052; Article VI, Railroad Commission, Section 16, Appropriations Act, 2006 - 2007 Biennium, 79th Legislature, Regular Session, 2005; and Texas Government Code, §2001.031, and §§2110.001 - 2110.008.

Issued in Austin, Texas on January 24, 2006.

§7.7201.Natural Gas Pipeline Competition Study Advisory Committee.

(a) Definitions. The following words and terms, when used in this section, shall have the following meanings, unless the context clearly indicates otherwise.

(1) Commission--The Railroad Commission of Texas.

(2) Committee--The Natural Gas Pipeline Competition Study Advisory Committee of the Commission.

(b) Establishment; duration. The Natural Gas Pipeline Competition Study Advisory Committee is hereby established. The committee is abolished on December 31, 2006, unless the Commission amends this subsection to establish a different date.

(c) Purpose and tasks. The purpose of the committee is to give the Commission the benefit of the members' collective business, technical, and operating expertise and experience to help the Commission review competition in the Texas intrastate pipeline industry, assess the effect of current statutes and rules on such competition, and develop recommendations for changes to statutes or rules that may be necessary. The committee shall report its advice and recommendations in writing to the Commission no later than July 1, 2006.

(d) Nominations for committee membership. The Commission shall make nominations for membership on the committee. All members of the committee serve at the pleasure of the Commission. If a member resigns or otherwise vacates his or her position prior to the end of his or her term, the Commission shall appoint a replacement who shall serve the remainder of the unexpired term.

(e) Reimbursement of members' expenses. The Commission shall not reimburse members for travel or other expenses related to service on the committee.

(f) Committee records. The committee shall maintain and make available to the Commission records of each committee meeting.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State on January 24, 2006.

TRD-200600380

Mary Ross McDonald

Managing Director

Railroad Commission of Texas

Earliest possible date of adoption: March 12, 2006

For further information, please call: (512) 475-1295