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U.S. Department of Transportation U.S. Department of Transportation Icon United States Department of Transportation United States Department of Transportation

Interpretation Response #PI-75-010 ([New Jersey Natural Gas Company] [P. H. Reardon])

Below is the interpretation response detail and a list of regulations sections applicable to this response.

Interpretation Response Details

Response Publish Date:

Company Name: New Jersey Natural Gas Company

Individual Name: P. H. Reardon

Location State: NJ Country: US

View the Interpretation Document

Response text:

March 19, 1975

Mr. P. H. Reardon, Manager
Gas Operations and Maintenance
New Jersey Natural Gas Company
601 Bangs Avenue
Asbury Park, New Jersey 07712

Dear Mr. Reardon:

This responds to your letter of February 25, 1975, referring to a statement in this Office's Advisory Bulletin No. 75-1 (January, 1975) which reads:

"Where a public housing authority purchases gas from a public utility and then sells
and distributes the gas through its own mains and service lines to customers who
may or may not be metered, the housing authority is the operator of a gas
distribution system and is subject to the requirements of 49 CFR Part 192."

In this regard, you ask whether a public housing authority that does not charge an identifiable fee
for gas delivered to tenants but instead receives payment for the gas as part of the rent money is
selling gas to tenants and consequently subject to 49 CFR Part 192.

As to the first part of your question, we believe the housing authority is selling gas to tenants. If,
as it appears, the housing authority agrees to furnish gas to tenants and receives compensation for
the service by receipt of rent, a sale of gas occurs. An allocation of rent for the service or other
identifiable charge is not necessary to how a sale of gas.

As to the second part of your question regarding the consequence of the sale, the jurisdiction of
Part 192 over a person is not determined by whether the person is selling gas. Rather, it is
determined by whether the person owns or operates gas pipeline facilities used to transport gas in
commerce. The sale of gas is relevant, but only to indicate that the transportation involved is
subject to Part 192. The transportation of gas subject to Part 192 ends when ownership of the
gas is transferred to an ultimate consumer, normally by sale and delivery to the consumer.

In the example quoted from Advisory Bulletin 75-1, the housing authority is transporting gas to
others for consumption through its own pipelines. The sale of gas indicates that the transportation
is in commerce and subject to Part 192. The fact that the housing authority owns and
operates the pipelines involved in the transportation, not its sale of the gas, subjects it to the jurisdiction of Part 192.

We appreciate your interest in pipeline safety.


Joseph C. Caldwell
Office of Pipeline Safety

Regulation Sections

Section Subject
192.3 Definitions