The statutes under which OPS operates provide for state assumption of all or part of the intrastate regulatory and enforcement responsibility through annual certifications and agreements. Most states have supported the concept of common stewardship in pipeline safety. This cooperative, collaborative relationship between the federal and state government--the Federal/State Partnership--forms the cornerstone of the pipeline safety program.

 Federal grant funds are used as an incentive to improve state program performance and to encourage states to take on more responsibility for pipeline. OPS is authorized to reimburse a state agency up to 50 percent of the actual cost for carrying out the state's pipeline safety program, including the cost of personnel and equipment. Federal funding is determined through an allocation formula based on factors such as the extent to which the state asserts safety jurisdiction, whether the state has adopted all federal requirements, and the number and qualifications of the inspectors.