Wednesday, March 7, 2012

Disclosures Updated...

Since the explosion of a gas transmission pipeline in San Bruno in 2010, Real Estate Agents throughout California are voicing opinions regarding the disclosure of gas lines in real estate transactions based on the constant 'marketing' efforts of some NHD providers. This type of advertising promotes the perception that disclosing gas pipelines is essential in protecting one's liability. Not so fast! Before jumping on the bandwagon by supporting NHD companies that "disclose" gas transmission pipeline locations in their NHD reports, we need to better understand the likely risks of providing this information in a NHD report. Remember, the NHD Industry is not regulated; essentially allowing NHD providers the freedom to shape their reports with information based solely on their judgment...not the requirements. Often these arbitrary, unauthorized additions to your NHD report only serve to increase your liability...instead of protecting it! Currently, there are no laws in California that require sellers, agents, or NHD companies to provide gas transmission pipeline disclosure to a buyer. In fact, according to disclaimers, the National Pipeline Mapping System (NPMS) maps that are being used for these "disclosures" are inaccurate and incomplete. Pipeline location depicted by the NPMS Public Map Viewer is intended to be used for general reference only. The NPMS limits the viewing scale due to Federal Homeland Security concerns, making precise disclosure of the pipelines virtually impossible. NPMS data consists of gas transmission pipelines and hazardous liquid trunk lines only. It does not contain gathering or distribution pipelines, such as lines which deliver gas to a customer's home. Disclosure of only transmission gas pipelines can give a prospective buyer the impression that only those lines present a potential danger. Since NPMS data location is not accurate; printing a map of the NPMS and tracing the lines onto another map in a disclosure report introduces additional inaccuracies. Not all pipelines in an area are visible in the Public Map Viewer. For example, jet fuel pipelines would not be visible, and therefore not disclosed. So, selecting only the NPMS maps can place additional liability on the agent to discover other maps that show other pipelines.

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