0001
 1                   PUBLIC HEARING
       CONTROL OF EMISSIONS FROM NONROAD SPARK-IGNITION
 2                 ENGINES AND EQUIPMENT
                NOTICE OF PROPOSED RULEMAKING
 3   
 4          PANEL MEMBERS:  Bryan Wood-Thomas
 5                          Glenn Passavant
 6                          Susan Stahle
 7                          Amber Aranda
 8   
 9   
10                                     Reston, Virginia
11                                Tuesday, June 5, 2007
12   
13   
14   called for oral testimony at the Sheraton Hotel,
15   11810 Sunrise Valley Drive, Reston, Virginia
16   before Mary E. Warner of Capital Reporting, a
17   Notary Public in and for the Commonwealth of
18   Virginia, beginning at 9:30 a.m.
19   
20   
21   
22   
0002
 1                   PRESENTERS
 2   Bill Guerry - Outdoor Power Equipment Institute
 3   Ron Lloyd - Toro
 4   Rob Stegall - Echo
 5   Frank O'Donnell - Clean Air Watch
 6   Nancy Kruger - National Association of Clean Air
 7                  Agencies
 8   Elizabeth deLone Paranhos - Environmental Defense
 9   Joe Kubsh - Manufacturers of Emission Controls
10               Association
11   Wayne Richter - Heraeus
12   Todd Rodgers - Arkema
13   Todd Rodgers (for Gary Eden) - Solar Plastics
14   Robert Porter - Inca Molded Products
15   Tony Riviezzo - Promens, Inc.
16   Dan Grimes - Centro
17   Mike Freeman - Global Safety
18   Rich Waggoner - Indmar Marine Products
19   Dan Ostrosky - Yamaha Motor Corporation
20   Roger Gault - Engine Manufacturers Association
21   Nickolaus Leggett - Private Citizen
22   
0003
 1   John McKnight - National Marine Manufacturers
 2                   Association
 3   Mark Riechers - Mercury Marine
 4   Paul Ray - Ilmor
 5   Paul Dierksen - Volvo Penta of the Americas
 6   Chuck Thurman - Pleasurecraft Marine Engines &
 7                   Crusader Marine Engines
 8   Eddie Allbright - Marine Power
 9   Dave Marlow - Brunswick Boat Group
10   Fernando Garcia - Bombardier Recreational Products
11   Masakazu Kikuchi - Tohatsu
12   John Adey - American Boat & Yacht Council
13   Jim Hardin - Grady White Boats
14   Steve Burkholder - Envirofill
15   
16   
17   
18   
19   
20   
21   
22   
0004
 1                  P R O C E E D I N G S
 2          MR. WOOD-THOMAS:  Let's begin today.  Good
 3   morning to all of you.  I'd like to welcome you
 4   today to our public hearing on the small
 5   spark-ignition rule.  I'm Bryan Wood-Thomas.  The
 6   Associate Director of EPA's Office of
 7   Transportation and Air Quality.  I'll be serving
 8   as the presiding officer for this hearing.
 9            We will be hearing testimony today on the
10   notice of proposed rule making for emissions from
11   non-road spark-ignition engines and equipment
12   which was signed by the administrator on April
13   17th and published in Federal Register on May 18th
14   of this year.
15            Today more than half our population in
16   the United States, 160 million Americans live in
17   485 counties that are not meeting air quality
18   standards for PM or ozone or both.  As part of
19   EPA's effort to reduce these emissions, we have
20   set emission standards for over the last decade
21   for nearly all types of highway and non-road
22   engines, vehicles and equipment.
0005
 1            Also over the past ten years we've made
 2   important steps towards reducing pollution from
 3   small gasoline powered engines and recreational
 4   marine engines.
 5            The proposed rule which is the subject of
 6   today's hearing will dramatically cut emissions
 7   from gasoline powered recreational marine engines
 8   and small land based engines.  The proposal
 9   applies to all types of recreational marine
10   engines, including outboard, personal watercraft,
11   stern drive and inboard engines.
12            The proposal also applies to both
13   handheld and non-handheld small engines and
14   includes evaporative emission requirements that
15   apply to the vessels and land based equipment that
16   use these engines.
17            I'd like to briefly outline what we've
18   proposed.  The proposal consists of a three part
19   program.
20            First for small engines, we're proposing
21   hydrocarbon and NOx emission standards which would
22   result in a 35 reduction in HC and NOx exhaust
0006
 1   emission from new engines.  For class I engines,
 2   the new standard would start in 2012 model year.
 3   And for class II engines, they would start in
 4   2011 model year.
 5            These standards are consistent with the
 6   requirements recently adopted by the California
 7   Air Resources Board.  Second we're proposing new
 8   emission standards for marine propulsion engines
 9   starting in the 2009 model year.  And for outboard
10   and personal watercraft engines above 40 KW the
11   proposed standards are 16 grams per kilowatt hour
12   for HC and NOx and 300 grams per kilowatt hour for
13   CO.
14            For engines below 40 KW, the standards
15   increase gradually based on the engine's maximum
16   power.  And these standards again are consistent
17   with the requirements recently adopted by
18   California Air Resources Board with the addition
19   of the CO standard.
20            We're also proposing the first ever
21   Federal emission standards for sterndrive and
22   inboard marine engines.  The proposed standards
0007
 1   would result in an estimated 70 percent reduction
 2   in HC and NOx emissions and a 20 percent reduction
 3   in CO in the new engines.
 4            Third, we're proposing new evaporative
 5   emission standards for both engine categories.
 6   The new standards include requirements to control
 7   fuel tank, fuel line permeation emissions.
 8            In addition small engine fuel systems
 9   used with non-handheld equipment must control
10   diffusion and running loss emissions.
11            Recreational marine engine fuel systems
12   must also control diurnal emissions.  And the
13   proposed standards would result in a 45 percent
14   reduction in evaporative emissions for small
15   engine equipment fuel systems and approximately 70
16   percent for recreational marine engine vessel fuel
17   systems.
18            As with our other recent rule makings
19   we've worked collaborative with diverse
20   stakeholders, many of you have worked with Glenn,
21   Mike Samulski, Alan Stout, others involved in
22   this effort.  And many of those stakeholders
0008
 1   including engine and equipment manufacturers,
 2   technology companies, environmental groups and
 3   states are present today for this hearing.
 4            Let me say that we look forward to
 5   continuing to work together collaboratively as we
 6   move forward to finalizing this important rule.
 7            Today's hearing allows for any interested
 8   party to provide comments on the proposal in
 9   person.  However, I want to note there's also
10   opportunity for anyone to send us written
11   comments.  The written period comment period will
12   close on August 3rd.  And instructions for how to
13   submit those comments are provided in the notice
14   of proposed rule making in the Federal Register
15   publication noted before.
16            Representing EPA here today with me is
17   Glenn Passavant, who is on my left and is
18   responsible for managing the project overall.
19   Susan Stahle to Glenn's left is with the Office of
20   General Counsel.  And also with us here today is
21   Alan Stout and also Mike Samulski.  We expect
22   also another member of our general counsel to join
0009
 1   us later this morning.
 2            Before we start testimony this morning,
 3   I'd like to take a few minutes to outline how
 4   we're going proceed.  We're conducting the hearing
 5   in accordance with section 307 of the Amended
 6   Clean Air Act which requires EPA to provide
 7   interested persons an opportunity for oral
 8   presentation of data, views, arguments in addition
 9   to the ability to make written comments.  The
10   official record of the hearing will be kept open
11   for 30 days after this hearing.  And the hearing
12   will be conducted informally and formal Rules of
13   Evidence will not apply.  However, as the
14   presiding officer, I'm authorized to strike
15   statements from the record which are deemed
16   irrelevant or needlessly repetitious and to
17   enforce reasonable limits on the duration and
18   statement of any witness.  Hopefully that's not an
19   issue.  We do have quite a few witnesses today.
20   And we'd like to keep a reasonable time frame for
21   your statements between five to ten minutes and to
22   help move things along efficiently.  As many of
0010
 1   you are aware, we've organized the testimony into
 2   panels.  And given people's arrival we're going to
 3   make some adjustments to that as well.
 4            Witnesses must state their name and
 5   affiliation prior to making their statement.
 6   Please do so.  If not, I will remind you.  When a
 7   witness has finished his or her presentation, we on
 8   the panel will avail ourselves of the
 9   opportunity to ask questions related to the
10   testimony.  Those will be principally be issues of
11   clarifications, if we have any questions about
12   points being made.  And any false statements or
13   false responses are a violation of law.
14            If any member of the audience here today
15   has not already signed up, please submit your name
16   at the reception table.  We'll -- we will indeed
17   accommodate everyone who wants to testify and
18   we'll stay here as late as necessary to do that.
19            And to everyone attending we'd also ask
20   to please sign the register whether or not you're
21   testifying.
22            Finally, a court reporter is recording
0011
 1   these proceedings.  If you'd like a transcript of
 2   today's public hearing, you should make
 3   arrangements, directly with the court reporter
 4   during one of the breaks.  We'll place a copy of
 5   the transcript from today's hearing in the docket
 6   for rule making within the next few weeks. And
 7   before we begin our panels and all testimony
 8   I want to ask if there are any clarifying
 9   questions from anyone here?
10            Okay.  If not what we'll do is proceed to
11   begin with our testimony.  And one of the
12   adjustments due to availability and arrival of
13   people is we're going to begin with panel 2, with
14   Bill Guerry, Ron Lloyd, Rob Stegall.  If you could
15   come forward.
16            MR. GUERRY:  Good morning, my name is
17   Bill Guerry.  I am counsel to the Outdoor Power
18   Equipment Institute.  I'm joined on this panel
19   this morning with Ron Lloyd, who is chair of the
20   OPEI Clean Air Act Committee, which is the lead
21   organization that interfaces with EPA on behalf of
22   the ground supported engine and equipment
0012
 1   manufacturing group under OPEI.  To his right is
 2   Rob Stegall, who is chair of the OPEI handheld
 3   committee.
 4            Today I'm going to provide an overview of
 5   the emission contributions from ground supported
 6   and handheld lawn garden equipment and speak to
 7   some of the tremendous benefits that we working
 8   with EPA have accomplished over the last 11 years
 9   on three phases of emission regulations.
10            Ron Lloyd is going to discuss some of the
11   challenges in the ground supported world, in
12   particular related to the non-integrated nature of
13   that industry sector where we have separate and
14   distinct engine manufacturers, equipment
15   manufacturers, muffler manufacturers and catalysts
16   manufacturers.
17            Rob Stegall is then going to provide an
18   overview of some of the specific challenges that
19   are unique to certain handheld products, like
20   chain saws and then I'm going to provide a brief
21   summary that's going to outline some of the themes
22   that OPEI will be submitting comments on by the
0013
 1   August 3rd deadline.
 2            Who is OPEI?  OPEI is an International
 3   trade association.  It has three major missions.
 4   The first is developing and promoting clean and
 5   cost-effective technologies.  The second is
 6   developing and ensuring safe products.  We do that
 7   through our leadership under both the ANSI and ISO
 8   standard process to help safely implement the EPA
 9   phase three program.  OPEI is already way underway
10   in developing new ANSI standards that will apply
11   to essentially all the new components that are
12   part of this regulatory program.  Those include
13   fuel tanks, fuel lines and catalysts all which
14   have separate and distinct challenges that we're
15   working on.
16            We also do a lot of work with education
17   of users and regulatory agencies and a stewardship
18   role to make sure many of the small members are
19   well prepared for challenges such as of the ones
20   in the phase three rule.
21            Who we represent:  Quickly we cover
22   basically all of the major green spaces that you
0014
 1   see be it lawn and garden, golf courses,
 2   commercial turf care.  All that green space is
 3   maintained by our products.  Our manufactures
 4   include not only the engines and equipment but
 5   also important components that are also part of
 6   this rule such as catalysts manufacturers.  I know
 7   you're going to hear from Wayne Richter, Heraeus
 8   which is an OPEI member, of a muffler
 9   manufacturers, fuel tanks, lower permeation
10   barrier technologies.  We represent the solutions
11   that are part of the process.
12            As I mentioned, this is an industry
13   dominated by hundreds of small manufacturers and
14   component suppliers and they depend on OPEI in
15   their interface regulatory agencies in preparing
16   them to produce safe product.
17            Harmonization, I know my colleague, Roger
18   Gault, from EMA will be highlighting some of the
19   needs for harmonization from the engine
20   manufacturer's standpoint but as I believe EPA well
21   understands, manufacturers must build and
22   distribute through national retailers 50 State EPA
0015
 1   CARB compliant products.  When you're dealings
 2   with millions of products and you're selling them
 3   through five major national retailers for the most
 4   part, you can't segregate products for 50 states.
 5            We appreciate the fact that the phase
 6   three program is largely based on the CARB tier
 7   three exhaust and evaporative programs and should
 8   allow us to build 50 state products for the most
 9   part.
10            However, there are problematic
11   inconsistencies in CARB and EPA's certification,
12   labelling and test procedural requirements.  Those
13   requirements mean that instead of being able to
14   certify and test one time, particularly under the
15   evap program, we have to redo duplicative
16   unnecessary tests to certify under the evap fuel
17   tank and fuel lines essentially the same product.
18   So there's no benefit to significant cost.  Rob
19   Stegall is going to be discussing that in his
20   remarks.
21            We look forward to work with EPA and with
22   our colleagues at CARB to achieve improved
0016
 1   harmonization.
 2            The time lines, I have enjoyed over the
 3   last 15 years working closely on the three phases
 4   of emission regulations that the folks in Ann
 5   Arbor have developed with a lot of constructive
 6   solutions from OPEI and other stakeholders.
 7            The point of this slide is just to
 8   highlight that there has been a remarkable amount
 9   of regulatory activity in our industry.  This is
10   the third regulation in 11 years.  We support the
11   development again of this regulation.
12            However, I just wanted to highlight that
13   our manufacturers produce very cost sensitive
14   products.  We need stability after regulation is
15   adopted.  There are concerns that if manufacturers
16   have to rebuild and redesign new models for each
17   new model year, the system won't work.  We can't
18   produce products like that.  We need to have 
19   stability.  We need to have targets and we need to
20   have lead time.
21            Quickly I just want to go through a
22   couple slides that highlights the tremendous
0017
 1   emission benefits that have resulted from the
 2   first two phases of exhaust regulations.
 3            And I want to thank EPA Ann Arbor staff
 4   for helping in the development of these slides in
 5   providing us with background documents from the
 6   EPA non-road model.
 7            This first slide is focusing on a class
 8   one engine.  That's the high volume engines used
 9   to power walk behind mowers.  You can see the
10   reductions occurring from the phase one, phase two
11   and proposed phase three.  The phase three level
12   is basically confirming a 90 percent reduction
13   from the precontrol baseline, engines that were
14   around in 1996.  That's an incredible
15   accomplishment to achieve in roughly 11 years a 90
16   percent reduction in CARB emissions.
17            A similar story for handheld exhaust,
18   where the phase two, three exhaust standards have
19   achieved an 85 percent reduction, compared to
20   baseline engines.  That's a tremendous
21   accomplishment.  We take great pride in that.
22            The next slide total contributions to
0018
 1   man-made smog.  This again I want to thank a lot
 2   of input from the Ann Arbor staff in pulling this
 3   together.  As you can see in the relative
 4   categories, the predominant emissions of smog are
 5   from stationary sources about 50 percent.  Cars
 6   and trucks are about a third.  The entire off road
 7   sector of all engines and vehicles are about 19
 8   percent.  And the small gasoline engines and
 9   that's handheld and ground supported are 3.4
10   percent of the off road -- I'm sorry, 3.4 percent
11   of the total or about less than a fifth of the off
12   road.
13            The next slide is a lawn mower versus
14   auto comparison.  I put you this in here because
15   there has been associated in the press a lot of
16   misleading exaggerated comparisons on the relative
17   emissions of lawnmowers compared to autos.
18            So we spent time and I submitted into the
19   record, this morning an analysis that our
20   consultant, Dr. Sawho has documented that in
21   actuality when you look at mass emissions, one car
22   emits more on an annual basis than four
0019
 1   lawnmowers.  Those are phase two current
 2   lawnmowers.  And over the lifetime over its full
 3   lifetime, one car will emit more mass emissions
 4   than five lawnmowers.
 5            We would appreciate in press releases a
 6   more accurate objective characterization of these
 7   relative emissions.  And again I will submit into
 8   the record analysis to support those comparisons.
 9            While we're talking about emission
10   reductions, I'd also like to highlight that above
11   and beyond as we move through the phase three
12   process the exhaust emissions will achieve another
13   35 percent reductions in ground supported
14   emissions.  Permeation emissions will be reduced
15   by 45 percent below the total evaporative
16   emissions.  That's looking at handheld and ground
17   supported.  One component of that 45 percent is
18   fuel lines for ground supported, the industry, is
19   supporting EPA's proposal to pull up the fuel line
20   requirement to the 2008 engine model year which
21   essentially means no lead time.  We're doing that
22   to help support and achieve expeditiously
0020
 1   substantial air quality gains.  It's an important
 2   part, however, of -- in pulling up those fuel
 3   lines, which achieves a 90 percent below current,
 4   that's one of the reasons that we feel EPA can and
 5   should support us in the flexibilities that are
 6   proposed in the rule.
 7            All right.  With that overview, I'll now
 8   turn it to our CAAC chairman, Ron Lloyd.
 9            MR. LLOYD:  Good morning.  Can you hear
10   me?  Is the mic on?  There you go.  Good morning
11   my name is Ron Lloyd.  I'm senior principal design
12   engineer with the Toro Company.  And I'm here
13   representing the Clean Air Act Committee, which is
14   part of the Outdoor Power Equipment Group.
15            Today I'm speaking to you on behalf of
16   the Clean Air Act Committee working group of OPI.
17   Our group is made up of representatives from both
18   the equipment manufacturers, engine manufacturers,
19   muffler manufacturers and catalysts manufacturers.
20   We represent a significant volume of the product
21   that is sold in our industry in the US.
22            Here's an example of the variety of
0021
 1   equipment types that our committee represents,
 2   ride on commercial turf, carried equipment,
 3   generators, power washers, sprayers, commercial
 4   consumer walk behind mowers, ride on mowers,
 5   garden tractors, utility vehicles.
 6            This represents the basic equipment types
 7   represented directly by OPEI but as stated before,
 8   the small utility engines are used in thousands of
 9   equipment applications that go beyond outdoor
10   power equipment universe.
11            EPA phase three rule flexibility, the
12   proposed lead time and flexibilities are needed
13   for both safety and durability evaluations to
14   build confidence in the emissions reductions from
15   the engine manufacturer's side, flexibility and
16   implementation strategy to fit the complex and
17   non-integrated business structures in our
18   industry.
19            Product design complexities:  Product
20   design complexities are created by the fact that a
21   single engine design is used in multiple product
22   applications.  A small spark-ignited utility
0022
 1   engine may be used to power a walk behind mower in
 2   variable load dirty environment.  And it also may
 3   power a steady load generator in a fairly clean
 4   environment.  And there are hundreds of
 5   applications in between.
 6            Sometimes the exhaust system is added to
 7   the final application by the equipment
 8   manufacturer.  And sometimes the engine supplier
 9   provides the complete system with the engine.
10   There could be thousands of verifications of
11   exhaust systems, as each system is designed to
12   provide the exhaust dispersion, heat mitigation
13   and sound intonation necessary for every
14   application.  The end requirement for the exhaust
15   system is dependent upon the application and the
16   equipment design and the performance
17   specifications.
18            Different applications are used in
19   different environments.  And in some sheltered and
20   some without the detrimental effects of dust and
21   debris.  And others in very difficult environments
22   with dust and debris being the normal expectation.
0023
 1   This leads to variations in users, attention to
 2   maintenance and patterns.
 3            This is an iterative development process
 4   between the OEM and muffler supplier and the
 5   engine manufactures.  The slide shows many loops
 6   in there.
 7            Toro, for example, and I'm speaking for
 8   myself in this case, not CAAC, but Toro, for
 9   example, does not have its first OEM class two
10   supplied catalytic muffler approved for 2008 use
11   in California.  And all I can say is that we are
12   way behind but it's not for lack of trying.
13            This process so far has not been very
14   pleasant.  An engine manufacturer catalyst that
15   they may develop for a specific engine family does
16   not necessarily work with different muffler sizes
17   and placements requiring very unique product
18   constructions.
19            This process can also be very expensive
20   with some manufactures requiring the OEM to
21   provide certifiable test data to the engine
22   manufacturer of engines to full useful life at our
0024
 1   approximate cost of $70,000 per application.
 2            Toro alone has approximately 45 different
 3   mufflers that might require this type of effort
 4   and cost.  The iterative nature of this process is
 5   why the lead times agreed to are required by our
 6   industry.
 7            The engine manufacturer, has to review
 8   all the applications for all the different
 9   mufflers.  And he has to review, for instance for
10   a single muffler, a single engine family, he may
11   have to review over 100 pieces of equipment or 100
12   different potential mufflers to be approved for
13   that engine family.  So he has a lot of work to do
14   in this application.
15            Lead times for national market.  Limited
16   CARB tier three compliant products will be offered
17   in the California market.  For the national market
18   over 1,500 equipment models with different
19   mufflers and fuel tanks will be required.  Some
20   individual OEMs have over 80 unique mufflers on
21   riding mowers.
22            Thank you for your time.  And also I want
0025
 1   to thank the EPA Ann Arbor crew for working
 2   closely with our group to develop a comprehensive
 3   phase three rule for an industry as complex and
 4   non-integrated as ours.
 5            I would now like to introduce to my
 6   right, Mr. Rob Stegall for some comments from the
 7   handheld product group.
 8            MR. STEGALL:  Thank you, Ron.  And good
 9   morning.  We did have a demonstration scheduled
10   outside here, we didn't realize you were going to
11   cover the windows.  We had some of our green
12   technology available today but they were five
13   minutes early.  We'll try to do better in the future.
14            Good morning my name is Robert Stegall.
15            MR. GUERRY:  OPEI's other mission along
16   with environmental protection is promoting the use
17   of quiet product and building quiet products.
18            MR. STEGALL:  I'm the Director of
19   Emission Compliance with Echo, Incorporated a
20   manufacturer of outdoor lawn and garden equipment.
21            Today I'm speaking to you as a chairman
22   of the handheld product committee of OPEI.  Our
0026
 1   members are listed in the slide in front of you.
 2   We represent a majority of the handheld products
 3   manufactured for sale in the US today.
 4            The products we market including amongst
 5   other chain saws, hedge clippers, trimmers and
 6   brush cutters which are intended for use by home
 7   owners, farmers, professionals and commercial
 8   operators.
 9            We have and will continue to work with
10   EPA to finalize the Rule under discussion today in
11   a cost effectively and environmentally friendly
12   manner.  I have only a few points to make at this
13   time.
14            First of all, we fully support EPA's
15   proposed flexibility for products using
16   structurally integrated fuel tanks as well as
17   those provided for products that must be used in
18   all weather conditions including very cold and
19   ambient temperatures.
20            Portability and maneuverability are the
21   key to safe and efficient use of our products.  As
22   such we design and manufacture the engine, the
0027
 1   fuel system and the equipment as an integrated
 2   assembly.  For example, a chain saw must
 3   incorporate the fuel tank as part of the product
 4   support structure.  These tanks must be strong
 5   enough to support both the operating engine, as
 6   well as the forces placed upon the product during
 7   use.  Common blow molding is not an option.  The
 8   materials used must have high strength and impact
 9   resistance as well as high temperature resistance.
10            We often use vibration isolation systems
11   between the handles and engine to reduce vibration
12   exposure to the operator, as such, fuel line
13   flexibility is much more critical than those of
14   other products we typically use in everyday life.
15            Fuel line materials must with stand high
16   movements and vibrations at extreme temperatures
17   without breaking or cracking.  The flexibilities
18   EPA has provided for while challenging in terms of
19   permeation reduction should allow us to engineer
20   safe, practical and cost-effective solutions.
21            EPA has proposed to migrate the exhaust
22   test procedures from part 90 to 40 CFR part
0028
 1   1065.  While we do not disagree with the intent
 2   our preliminary review of 1065 indicates that our
 3   equipment and facilities must be replaced and
 4   updated.
 5            We spent millions of dollars building
 6   laboratories and purchasing unnecessary equipment
 7   to run today's tests.  According to the guidelines
 8   in part 90s.  Most companies have two facilities
 9   to handle development work as well as production
10   line testing.  The different equipment
11   requirements in part 1065 would require retooling,
12   a major expense with no additional environmental
13   benefit.
14            We propose to work with EPA to keep the
15   essence of the current test procedure and
16   equipment in part 90 intact at some level.
17            OPEI recognizes and appreciates EPA's
18   efforts to reduce certification burden on
19   manufacturers in the early years of the proposed
20   rule by allowing for the acceptance of CARB
21   certifications as proof of compliance with the
22   phase three fuel tank evaporative requirements.
0029
 1   We remain concerned, though, that the test
 2   procedures between EPA and CARB remain different
 3   in many aspects including temperature, fuel type
 4   and reconditioning.  We need a long term solution
 5   between CARB and EPA for acceptance of each
 6   other's test procedures with equivalent or
 7   correlated standards.  This should include
 8   language in a rule that would avoid necessity to
 9   request for and received approval to use each
10   other tests.  Since EPA has approved the California
11   rule and principle, we assume the test procedures
12   are also accepted as good engineering practice.
13            Without a solution, we're forced to
14   conduct dual certification testing which can take
15   up to six months for each test for the same
16   products sold in California and the other 49
17   states.  We offer any and all assistance to EPA
18   and California in resolving this concern.
19            While we're still interpreting the
20   language of the preamble and the NPRM, we feel
21   more flexibility relative to engine and equipment
22   labelling and certification may be required,
0030
 1   especially for integrated equipment.  Our products
 2   are often so small that even today's exhaust
 3   labels are difficult to locate.  It is possible
 4   with today's rule that four separate
 5   certifications, that's four different families
 6   would be required on a product such as $159 chain
 7   saw.  This would require up to four labels.  We're
 8   aware of EPA's willingness to work this sort of
 9   detail out.  This would help reduce unnecessary
10   burdens which may occur as part of such a broad
11   and comprehensive package that's spelled out in
12   this rule.
13            Once again I thank you for your time and
14   also compliment EPA for its tireless work for
15   trying to develop a rule for an industry as
16   complicated and as diverse as we are.
17            I'd like to reintroduce Mr. Bill Guerry
18   for some wrap up comments.
19            MR. GUERRY:  Thanks, Rob.  In summary,
20   I'd just like to reiterate some of the points,
21   first in terms of lead time flexibilities and this
22   applies both to ground supported and handheld, I
0031
 1   just want to underscore that in our industry we
 2   literally have hundreds of different equipment
 3   manufacturers and separate and distinct suppliers
 4   that needed adequate time to go through three
 5   different processes as Ron Lloyd highlighted with
 6   catalyst.  And this also applies to fuel tanks and
 7   fuel lines and everything else.
 8            First there's a substantial lead time
 9   needed to integrate new materials and technologies
10   that frequently will behave differently in the
11   extreme operating conditions our equipment is used
12   than traditional or conventional materials.  And
13   that's true both with regard to the evap side as
14   well as the exhaust.
15            Second, we need, as we develop the
16   prototypes which is done through an iterative
17   process with a lot of different players, we need
18   to, once the prototypes are pulled together,
19   evaluate those prototypes for both safety,
20   emissions and durability under real world
21   conditions.  And running that equipment in the
22   field under real world conditions takes time.  As
0032
 1   I mentioned OPEI is developing the infrastructure
 2   and the support, the ANSI process to help members,
 3   particularly small members appreciate the best
 4   ways to quantify risk and avoid problems.
 5            Finally we need to build diverse
 6   equipment models for the national market.  As we
 7   indicated earlier, we believe EPA will be
 8   certifying the range of 1,500 different models.
 9   There are 1,000 different exhaust muffler
10   combinations that will have catalysts.  And
11   there's another 500 different fuel tanks that need
12   to be certified as separate families.
13            Fair and balanced competition, OPEI
14   appreciates EPA's efforts to increase enforcement
15   scrutiny with customs at the border.  We have a
16   tremendous problem and challenge in terms of
17   increased risk of low price point, non-compliant
18   products from offshore and the suppliers of those
19   products seem to be getting more brazen and
20   sophisticated.
21            In that regard OPEI supports EPA's
22   proposal to require bonds from offshore producers
0033
 1   with no US assets.  We feel those bonding
 2   requirements are the only mechanism that EPA has
 3   to hold accountable a bad actor that works through
 4   a shell importer to bring in non-compliant
 5   products.  We also urge EPA to put strong language
 6   in the final rule that prohibits anyone from
 7   selling noncompliant uncertified product.
 8            Mid level ethanol fuels, as you know,
 9   there's a lot of discussion right now on Capitol
10   Hill and certain states to go beyond the current
11   ten percent limitation on ethanol and to seek
12   approval, which is required in 211 (F)(4) of the 
13   Clean Air Act for EPA to approve a mid level ethanol
14   blend which is 20 percent ethanol.  We want to
15   make sure there's no loss of emission benefits
16   from this and other rule making.  We are very
17   concerned that the benefits that I discussed
18   earlier, like the 45 percent in reductions in
19   evaporative emissions could be dramatically
20   undermined by a proliferation of mid level ethanol
21   fuels and that would in effect snatch defeat from
22   the jaws of victory that we and EPA have worked so
0034
 1   hard with other stakeholders in the environmental
 2   community to provide these benefits to the
 3   American public.
 4            We strongly need leadership from EPA on
 5   accurately evaluating the impacts of all new
 6   fuels, first and foremost on commerce, on their
 7   existing and new products.  We believe that in the
 8   market right now there are over 500 million legacy
 9   products that are worth several trillion dollars
10   that could be damaged by an unwise policy
11   introducing new fuels before data gaps are filled.
12            I'll be submitting into the record an
13   extensive technical analysis that Dr. Sahu
14   prepared looking at the data gaps that need to be
15   filled relative to mid ethanol fuels that explains
16   some of the engineering principles, particularly
17   with regard to heat that are at the core of some
18   of the concerns.
19            I'd also like to note in terms of the
20   other bullets, EPA needs to take a strong
21   leadership role.  We look forward working with
22   EPA and the other stakeholders in terms of the
0035
 1   environmental impacts and impacts on manufactures.
 2   We thought it was very helpful that as part of the
 3   database of this process, EPA with Mike Samulski's
 4   help has issued an SAE paper that conclude just
 5   the hydrocarbon emissions alone with the current
 6   E-10 levels, which we support E-10 but you can see
 7   there's a delta in the 40 to 60, 70 percent range
 8   of increased emissions of E-10 from nylon tanks.
 9   And certainly makes you wonder what happens if you
10   go up to E-20 in terms of permeation emissions.
11            Now winding down, in terms of the
12   environmental emissions and goals, I would like to
13   underscore again that the equipment that outdoor
14   power equipment manufacturers supply is
15   indispensable in terms of maintaining green space.
16   We are a proud sponsors and our customers of the
17   stewardship of the land and the environment.  We
18   keep the green even greener.  We're part of the
19   solution.  We hope that there's a better
20   recognition in the public policy debates going on
21   right now that, for example, with carbon dioxide
22   gases that maintain preserving grass and forest
0036
 1   are a critical part of the solution, that's
 2   accomplished through our products.  Similarly with
 3   regard to if our products aren't in use, you have
 4   green space returning to brown space when that
 5   happens.  You have to turn the dust balls at
 6   dramatic increase of particulate emissions.  The
 7   broader views need to be included in the
 8   environmental assessments that are being made
 9   relative to outdoor power equipment.
10            In conclusion I first would like to thank
11   again the folks in Ann Arbor, the OPEI members are
12   committed to environmental stewardship and clean
13   products and to having a continued strong working
14   relationship with both EPA and CARB and the
15   States.  OPEI generally supports the EPA proposal
16   and will be submitting extensive constructive
17   comments.  We believe there are numerous technical
18   improvements that should be made so that the rule
19   can be effectively and practically implemented.
20   Thank you.
21            MR. WOOD-THOMAS:  Thank you, gentlemen.
22   We don't have any questions at this juncture of
0037
 1   the panel so we'd like to proceed to our next
 2   panel.
 3            Panel No. 3, Frank O'Donnell of Clean Air
 4   Watch, Nancy Kruger, National Association of Clean
 5   Air Agencies, Elizabeth deLone Paranhos,
 6   Environmental Defense, Joe Kubsh, Manufacturers of
 7   Emission Controls Association, Wayne Richter from
 8   Heraeus.
 9            Mr. O'Donnell, if you would like to
10   proceed, whenever you're ready.
11            MR. O'DONNEL:  Yes, sir, I'm ready to go.
12   Thank you very much.  My name is Frank O'Donnell
13   and I'm president of Clean Air Watch.  And I do
14   want to thank you sincerely for the opportunity to
15   speak today in support of EPA's proposed small
16   engine standards.  And I hope to be very brief.
17            Let me say I do want to appreciate also
18   the very constructive attitude of OPEI and 
19   commend them for it.  And I won't digress at this
20   point at anything lengthy on the topic that Bill
21   Guerry mentioned about mid level blends of ethanol
22   but I do agree with him that this is an area a
0038
 1   that needs both EPA leadership and scrutiny about
 2   what the effects will be on the -- not only
 3   products but consumers and the environment.
 4   Particularly the latter of course is what we're
 5   concerned about.  I'd just like to point that out.
 6            To the bottom line here, you know smog is
 7   a serious public health problem.  Technically
 8   known as ozone, smog can cause asthma attacks
 9   among children and adults, send people to hospital
10   emergency rooms and reduce a person's lung
11   capacity.  It's even been linked in more recent
12   research to premature death.
13            The evidence is quite clear that even
14   though we have reduced air pollution through other
15   clean air act standards, such as those for motor
16   vehicles, we still need to make further progress
17   to protect breathers until we can say that we
18   truly breath healthful air.
19            Just last Saturday, you probably saw
20   this, the Washington Post reported on continued
21   air pollution problems in the Washington, DC area.
22            Our clean air watch surveys verify that
0039
 1   similar problems persist in many states throughout
 2   the nation.  And as you know, EPA's independent
 3   science advisors and the agency's own scientists
 4   have concluded that existing air quality standards
 5   for smog must be made stricter to protect kids
 6   with asthma and others.
 7            Of course as we clean up cars and trucks,
 8   small engines is an increasingly large part of the
 9   pollution problem.  Cleaning them up further
10   absolutely must be part of the solution.
11            We think that EPA's proposed standards
12   are a good step in the right direction.  We all
13   know it would be better for air quality if they
14   could take effect sooner but we do hope you will
15   resist any effort to delay or weaken the standards
16   and that applies to both the lawn and garden
17   equipment and the marine aspect of this because
18   they are all part of the pollution that affects
19   breathers.
20            I look forward to seeing the new analysis
21   by Dr. Sahu.  We do know the EPA's public
22   analysis so far is that today a push mower emits
0040
 1   as much hourly pollution as 11 cars and a rider
 2   mower emits as much as 24 cars and that
 3   recreational watercraft can emits as much as 348
 4   cars an hour.  That's a heck of a number.
 5   According to EPA the estimated public health
 6   benefits from these standards would be enormous,
 7   almost three and a half billion dollars a year by
 8   2030, the total of course would dwarf any
 9   associated costs.  In addition, some of the costs
10   would be offset by fuel savings.  In this area,
11   anything that saves fuel is probably something we
12   ought to be thankful for.  By reducing the
13   emissions of smog forming nitrogen oxides, hydro
14   carbons and particle soot, EPA has calculated that
15   the standards would prevent 450 premature death,
16   500 hospitalizations and 52,000 work days lost
17   annually.  So the benefits are absolutely
18   substantial.
19            We believe EPA's careful and detailed
20   studies that put to rest earlier concerns that
21   have been raised about safety.
22            So let me conclude by thanking you for
0041
 1   spending as much time as you have in developing
 2   these standards, encouraging EPA to move forward
 3   and issue these standards in final form as soon as
 4   possible and hopefully this year.  Thanks very
 5   much.
 6            MR. PASSAVANT:  Thank you, Ms. Kruger.
 7            MS. KRUGER:  Good morning.  I'm Nancy
 8   Kruger, Deputy Director of NACAA, the National
 9   Association of Clean Air Agencies, which
10   represents air pollution control agencies in the
11   54 States and territories and more than 155
12   metropolitan areas across the country.
13            I'm pleased to have this opportunities to
14   present our views on EPA's proposed rule to
15   control emissions from non-road spark-ignition and
16   emitting equipment.
17            NACAA strongly supports prompt EPA action
18   to reduce emissions from these sources and
19   believes this long awaited proposal is critically
20   important.  State and local clean air agencies
21   across the country are facing the enormous
22   challenge of development strategies to achieve and
0042
 1   maintain the health based national ambient air
 2   quality standards for ozone fine particulate
 3   matter.
 4            In addition, EPA has already taken action
 5   to tighten the PM 2.5 NAAQS and is considering
 6   similar action on the ozone standards which will
 7   only increase the challenges facing state
 8   localities.
 9            Further many areas of the country are
10   plagued by unacceptable high levels of toxic air
11   pollution.  Emissions from the non-road
12   spark-ignition engines covered by this rule,
13   contribute to all of these problems.
14            In the Clean Air Act Congress vets state
15   and local clean air agencies with primary
16   responsibility for the control of air pollution.
17   This is a responsibility we take very seriously.
18   As we seek to achieve and sustained clean
19   healthful air throughout the country we must
20   consider full measure of emission reduction
21   feasible from every source of pollution as quickly
22   as possible.
0043
 1            With respect to the non-road
 2   spark-ignition engines smaller than 50 horse
 3   powers, however, state and local air agencies,
 4   very unfortunately, other than California are
 5   preempted from adopting standards or other
 6   requirements.  Therefore it's incumbent upon EPA
 7   to ensure that this rule achieves the greatest
 8   degree of reduction as soon as possible.
 9            And toward that end NACAA offers these
10   recommendations and comments for EPA's
11   consideration.
12            First, we support the Federal adoption of
13   exhaust emission standards for small
14   spark-ignition engines consistent with those
15   adopted by California.  However, with respect to
16   the implementation dates, we question the need for
17   the substantial additional lead time that EPA has
18   proposed beyond the expectation date by
19   California; five years until 2012 for class I
20   engines and three years until 2011 for class II
21   engines.
22            We believe an accelerated Federal
0044
 1   schedule is technically feasible and recommended
 2   that EPA consider more rapid implementation.
 3            Second, based on the agency's March 2006
 4   safety study and regulatory impact analysis for
 5   this proposal as well as public statements by
 6   engine makers, it is evident that additional more
 7   stringent emission standards are feasible for
 8   small spark-ignition engines, especially
 9   commercial equipment which operates hundreds, if
10   not thousands of hours a year.
11            Therefore we recommend that EPA consider
12   adding another tier of more rigorous standards for
13   class I and class II engines.
14            Third, data available in the EPA docket
15   indicates new compliance failures by various
16   models of lawn and garden equipment.  This has
17   been a continuing concern of NACAA's that is now
18   heightened by the fact that EPA has not proposed a
19   mandatory testing programs for these engines.  We
20   urge EPA to consider adding this program to ensure
21   in use performance at the levels envisioned by the
22   regulation.
0045
 1            With respect to marine spark-ignitions
 2   NACAA supports EPA's proposal to set CO standards
 3   for all sectors.  We also support the agency's
 4   proposal to establish the first ever Federal
 5   standards for vessels powered by sterndrive or
 6   inboard engines.  However, we note that stern
 7   drive and inboard engines with catalysts are
 8   already in production and engine makers are
 9   already tooled to produce catalyzed engines for
10   California for 2008.
11            Therefore, we believe that the proposed
12   Federal implementation schedule beginning in 2009
13   is appropriate and should not be delayed but we
14   recommend EPA also require that once a certified
15   engine is available in California it be sold
16   nationwide.
17            With respect to personal watercraft and
18   outboard engines we support the proposed standards
19   for implementation in 2009.  We note that EPA
20   anticipates manufacturers will meet these
21   standards with readily available and therefore why
22   the agency did not access the suitable catalysts
0046
 1   for these engines for the purpose of pursuing
 2   future more rigorous catalyst based standards.
 3            We recommend the agency conduct such an
 4   analysis and proceed with additional standards
 5   accordingly.
 6            We also support the inclusion of
 7   evaporative emission standards for all non-road
 8   spark ignition equipment and watercraft covered by
 9   this rule.  We are pleased that EPA proposed two
10   line controls in 2008 for class I and II small
11   spark-ignition engines as well as other
12   evaporative standards.  But we question the
13   absence of diurnal emission controls for these
14   engines and urge the agency to reconsider
15   this omission, from marine spark-ignition engines
16   to support the evaporative standards and encourage
17   the agency to implement them on the schedule
18   identified.
19            Finally, through this proposal EPA has
20   solicited comments on a July 2002 petition by the
21   American Road and Transportation Builders
22   Association to amend the Agency's rule on the
0047
 1   preemptive scope of section 209 of the Clean Air
 2   Act to preempt state and local requirements that
 3   impose in use and operational control or fleet
 4   wide purchase, sale or use standard on non-road
 5   vehicles.  Any preemption of state or local
 6   authority on non-road engines would
 7   inappropriately intrude on the ability of state
 8   and local governments to appropriately mitigate
 9   the impact of construction, not only for air quality
10   reasons but also for noise and other environmental
11   impacts.  NACAA vigorously opposes any such
12   preemption and strongly urges that EPA deny the
13   petition.
14            In conclusion NACAA is pleased that after
15   considerable delay, EPA proposes regulations for
16   nonroad spark ignition to engines.  We are further
17   pleased that this proposal was based on the
18   expectation that manufacturers will use catalytic
19   converters for the first time ever on many types of
20   watercraft and lawn and garden equipment.
21            After vigorous analysis and extensive
22   work with diverse stakeholders EPA determined that
0048
 1   such a strategy is feasible and safe and NACAA
 2   supports that determination.
 3            We urge timely action by EPA the final
 4   rule at the end of this year and look forward to
 5   working in partnership with EPA in according to
 6   the rule.  Thank you.
 7            MR. WOOD-THOMAS:  Thank you.  Elizabeth.
 8            MS. PARANHOS:  Good morning.  My name is
 9   Elizabeth Paranhos.  And I'm testifying today on
10   behalf of Environmental Defense.  Environmental
11   Defense is a nonprofit, non-governmental and
12   non-partisan environmental organization with more
13   than 500,000 members nationwide.  Since 1967, our
14   organization has linked science, economic and law
15   in solving today's most pressing environmental
16   issues.
17            Environmental Defense strongly supports
18   the immediate issuance of a final rule to control
19   emissions from spark-ignition marine and small
20   engines.  We believe the final rule that reflects
21   the timing and level of reductions currently
22   required by the California Air Resources Board is
0049
 1   achievable, cost-effective and necessary to
 2   protect human health and the environment.
 3   Accordingly, Environmental Defense strongly
 4   opposes any further delay in finalizing this rule.
 5            First, I'd like to begin by painting a
 6   picture as to why the publication of a final rule
 7   for the control of spark-ignition engines is of
 8   such vital importance.  Despite their size, the
 9   engines affected by this proposed rule are
10   significant polluters.  Marine and small
11   spark-ignition engines emit hydrocarbons, nitrogen
12   oxide, particulate matter and carbon monoxide into
13   the air we breath, thereby contributing to
14   unhealthy air concentration in numerous areas
15   nationwide.  These small engines also contribute
16   significant amounts of hazardous air pollutants or
17   air toxics, that have been linked to an array of
18   serious public health effects including various
19   forms of cancer.  EPA estimates that absent the
20   implementation of these proposed rules, the
21   emissions from these engines will account for 27
22   percent of volatile organic hydrocarbon compounds,
0050
 1   31 percent of carbon monoxide, four percent of
 2   oxides of nitrogen and 16 percent of particulate
 3   matter from the mobile source sector by 2020.
 4            The specific health and environmental
 5   problems associated with these air pollutants are
 6   staggering.  Ground level ozone, the primary
 7   ingredient in smog, causes acute respiratory
 8   problems, asthma, increased hospital admissions
 9   and emergency room visits and aggravation of
10   cardiovascular disease.  Day to day increases in
11   ozone concentrations during the summer have been
12   linked to an increase in premature death.  Ozone
13   causes acute and chronic injury in sensitive
14   species, as well as damage to plant leaves and a
15   reduction in food production which can lead to
16   reduced crop yields.
17            Particulate matter has been shown to
18   cause premature mortality, aggravation of
19   respiratory and cardiovascular disease, aggravated
20   asthma, acute respiratory symptoms and decreased
21   lung function.  Fine particle and sulfate and
22   concentrations have been linked to lung cancer
0051
 1   mortality and exposure to ambient fine particles
 2   is associated with cardiorespiratory mortality.
 3   Particulate matter also causes adverse
 4   environmental effects including reduced
 5   visibility.  Reduced visibility not only
 6   interferes with the ability of many individuals to
 7   enjoy the ares in which we live and work but also
 8   significantly impairs our use and enjoyment of
 9   valuable national treasures such as wilderness
10   areas and national parks.
11            The evaporative emissions from
12   spark-ignition marine and small engines also
13   produce harmful effects.  Air toxics, such as
14   Benzene, 1,3-Butadiene, Formaldehyde, Acetaldehyde
15   and Naphthealene, are known or probable
16   carcinogens.  According to the EPA, Benzene is one
17   of the most significant contributors to cancer
18   risk of all air toxics in the ambient air.
19   Assuming continuous exposure to 1999 levels of all
20   air toxics, the nationwide lifetime population
21   cancer risk was 42 per million.  EPA calculates
22   that Benzene was responsible for 24 percent of
0052
 1   this cancer risk and was responsible for 45
 2   percent of the total inhalation cancer risk from
 3   mobile source air toxics.
 4            EPA also estimates by 2030 the proposed
 5   spark-ignition engine standards will result in the
 6   reduction of 631,000 tons of volatile organic
 7   hydrocarbon, 982,000 tons of oxides of nitrogen,
 8   6,300 tons of direct particulate matter, and
 9   2,690,000 tons of carbon monoxide emissions.
10   According to EPA, these reductions will likely
11   prevent 450 particulate matter related premature
12   deaths, 500 hospitalizations, and 52,000 work days
13   lost.  EPA estimates the total benefits of this
14   proposed rule equal 3.4 billion dollars whereas
15   the costs less than $240 billion.  At the same time,
16   EPA has woefully underestimated the robust health
17   benefits of this proposal by declining to assign
18   any positive value to the considerable ozone
19   health effects that would be prevented.  We
20   vigorously oppose EPA's failure to account for the
21   considerable ozone health benefits association
22   with the pollution reductions from these
0053
 1   high-emitting engines.  Even under EPA's meager
 2   valuation methodologies, it is manifest that
 3   pollution cuts from these engines will deliver
 4   extensive health benefits, and comparatively small
 5   costs.  To protect human health and the
 6   environment from the deleterious pollution
 7   released by these engines, we urge EPA to issue a
 8   final rule immediately utilizing as an essential
 9   benchmark the standards currently adopted by
10   California.
11            Turning now to the elements of the
12   proposed rule, we applaud EPA's proposal to
13   regulate, for the first time, exhaust emissions
14   from sterndrive and inboard marine engines.  We
15   support EPA's proposal to establish oxide of
16   nitrogen and hydrocarbon exhaust emission
17   standards that are comparable to those adopted by
18   California.  The proposed standards will result in
19   significant hydrocarbon and oxides of nitrogen
20   reductions, on average, 70 percent.  We also
21   commend EPA's initiative in setting a federal
22   carbon monoxide exhaust emission standard with an
0054
 1   expected reduction of 80 percent.
 2            We agree with EPA, that it is appropriate
 3   to set standards for sterndrive and inboard marine
 4   engines now.  Namely, the catalyst technology
 5   required to achieve the proposed emissions
 6   reduction is readily available.  Secondly, the
 7   costs imposed on manufacturers will be low, since
 8   many manufacturers are already redesigning engines
 9   to meet the California standards, and third, much
10   of the costs involved in meeting the standards
11   will be offset by the increased prices such
12   engines will command based on enhanced, higher
13   performance.  Indeed, as EPA has noted, one
14   manufacturer is already selling sterndrive and
15   inboard engines equipped with catalysts and others
16   have indicated they will do so by the end of the
17   year.  Given the current state of technology, we
18   believe EPA's proposed implementation date of 2009
19   provides more than adequate lead time to
20   manufacturers.
21            We also strongly support EPA's proposed
22   oxide of nitrogen, hydrocarbon and carbon monoxide
0055
 1   standards for outboard and personal watercraft
 2   engines.  Again, we are pleased that EPA has
 3   chosen to adopt standards that are similar in
 4   stringency to those adopted in California, and, to
 5   improve upon the California standards by providing
 6   for a carbon monoxide emission standard.  We
 7   strongly support EPA's near term 2009
 8   implementation date for these standards and agree
 9   with EPA that such a date provides sufficient lead
10   time for manufacturers to comply with these new
11   federal standards.  As EPA recognizes, the
12   technology required to meet the proposed oxides of
13   nitrogen and carbon monoxide emissions has been in
14   place for some years.  Indeed, manufacturers are
15   already producing several models of the cleaner
16   four stroke and direction injection engines
17   necessary to meet the proposed standards.
18            We are also pleased that EPA has chosen
19   to propose more stringent oxides of nitrogen and
20   hydrocarbon standards for class I and II
21   non-handheld small spark-ignition engines
22   consistent with the California standards.
0056
 1   However, we vigorously object to the much delayed
 2   implementation periods for these standards.  As
 3   EPA has indicated, some manufacturers are
 4   currently producing engines that employ the
 5   catalyst technology required to meet the proposed
 6   standards.  Therefore, a number of engine families
 7   currently are able to meet the proposed standards
 8   without an engine redesign.  Accordingly, we
 9   disagree that a multi-year lead time is necessary
10   to implement these standards.  Moreover, in light
11   of the length delay EPA has undertaken in
12   proposing these rules, we vigorously object to
13   implementation dates that are some four to five
14   years out.
15            We strongly support EPA's proposal to
16   implement evaporative emission standards for
17   spark-ignition marine and small engines.  In light
18   of the serious health effects caused by the
19   gaseous air toxics emitted from these engines, it
20   is imperative that EPA's final rules include
21   evaporative emission standards that are at least
22   as protective of human health as those adopted in
0057
 1   California.  We commend EPA for proposing fuel
 2   line and fuel tank permeation, running loss and
 3   diurnal standards.
 4            In conclusion, Environmental Defense
 5   strongly supports the immediate publications of a
 6   final rule implementing rigorous spark-ignition
 7   marine and small engine exhaust and evaporative
 8   emission standards.  In doing so, however, we
 9   emphasize the need for EPA to act swiftly.
10   Congress directed EPA to proposed rules for these
11   spark-ignition engines by December 2004 and final
12   rules by the end of 2005.  It is now mid 2007.
13   Environmental Defense respectfully believes EPA
14   has already acted contrary to law and in violation
15   of its legal duties by failing to issue final
16   standards.  We reserve all of our legal rights
17   under the Clean Air Act and other laws to compel
18   final EPA action.  Accordingly, we urge EPA not to
19   allow the current proposed rule to languish in the
20   halls of administrative inaction as have numerous
21   previous air pollution rules proposed before.  For
22   example, it took six years for EPA to finalize
0058
 1   proposed rules to control light vehicle refueling
 2   vapors.
 3            In sum, these small engines are big
 4   polluters.  The extensive pollution from these
 5   engines contributes to a suite of adverse human
 6   health and environmental effects nationwide.
 7   Environmental Defense respectfully urges EPA to
 8   immediately adopt protective emission standards.
 9   Doing so will help millions of Americans breath
10   easier.  Thank you very much for your time.
11            MR. WOOD-THOMAS:  Thank you.  Mr. Kubsh.
12            MR. KUBSH:  Good morning.  My name is
13   Dr. Joe Kubsh.  I'm the Executive Director of the
14   Manufacturers Emission Controls Association or
15   MECA.  And I'm pleased to provide testimony and
16   support of the EPA's emission standards for new
17   non-road spark-ignited engines, equipment and
18   vessels.  We believe that EPA's proposed
19   regulations are an important step forward from
20   small non-road engines and marine engines.
21            MECA is a nonprofit association of the
22   world's leading manufacturers of emission control
0059
 1   technology for mobile sources.  Our members have
 2   over 30 years of experience and a proven track
 3   record in developing and manufacturing emission
 4   control technology for a wide variety of on road
 5   and non-road vehicles and equipment including
 6   small engines used in lawn and garden equipment as
 7   well as other small spark-ignited engines used on
 8   mopeds and motorcycles.  Our members have invested
 9   millions of dollars in developing catalyst
10   technology for these small SI engines.
11            My comments today are specific to the
12   application of catalyst to class I and class II
13   and marine inboard and sterndrive spark-ignited
14   engines to comply with EPA proposed exhaust
15   emission standards for each of the these non-road
16   categories.
17            Firstly MECA supports EPA harmonizing
18   hydrocarbon and NOx exhaust emission standards for
19   class I and class II engines used chiefly on
20   non-handheld equipment with the California Air
21   Resources Board standards that were adopted in
22   2003 and began their implementation in 2007.  MECA
0060
 1   also concurs with the EPA staff analysis and
 2   conclusion that the proposed phase three HC and
 3   NOx exhaust emission standard for class I and
 4   class II engines are technologically feasible and
 5   that catalyst technology can be fully optimized as
 6   a part of a complete engine/emission
 7   control/exhaust system to help achieve these
 8   proposed limits.  MECA also supports EPA's
 9   proposal to establish a phase three CO standard of
10   five grams per kilowatt hour for marine
11   generators.
12            Secondly, MECA concurs with the
13   conclusions reached by EPA staff that the
14   application of catalysts to non-road equipment or
15   marine generators with either class I or class
16   II spark-ignited engines can be accomplished
17   using available engineering exhaust system design
18   principles in a manner that does not increase the
19   safety risk relative to today's uncontrolled
20   equipment.  In particular, the EPA safety study on
21   non-handheld equipment equipped with catalyzed
22   mufflers represents the most thorough safe study
0061
 1   completed to date on this class of spark-ignited
 2   engines.  The results of this EPA study showed
 3   that properly designed catalyzed mufflers pose no
 4   incremental increase in safety risk (and in many
 5   cases even lower muffler surface temperatures)
 6   relative to currently available non-handheld
 7   equipment sold without catalysts
 8            And thirdly, MECA supports EPA's proposed
 9   standards for HC and NOx and CO standards for
10   sterndrive and inboard marine engines, starting
11   with the 2009 model year.  MECA concurs that these
12   standards can be met with three way catalyst close
13   loop technology.
14            Below are a few additional comments on
15   the application of catalysts to class I, class
16   II and inboard/sterndrive marine spark-ignited
17   engines.
18            Based on over 30 years of experience in
19   designing and applying catalyst technology to a
20   variety of mobile sources, including small
21   non-road engines, MECA is convinced that
22   application of catalysts to class I and class
0062
 1   II engines is technically feasible as
 2   demonstrated by the extensive test programs
 3   conducted by EPA and ARB, and based on the
 4   extensive commercial experience base for the safe
 5   application of tens of millions of catalysts to
 6   wide range of small SI engines.  The EPA and ARB
 7   test programs conducted on class I and class II
 8   engines, in particular, demonstrated that
 9   catalysts can be safely designed to achieve the
10   useful life emission requirements required by
11   EPA's proposed phase three standards.  Early
12   commercial introduction of catalyst equipped
13   marine generators also provides strong evidence
14   that EPA proposed low CO standard for marine
15   generators is technically feasible.
16            Issues raised by small off road engine
17   and equipment manufacturers, such as heat
18   management, packaging, poisoning, and durability,
19   are straightforward engineering challenges that
20   are well understood and can be readily addressed.
21   These types of issues have been raised virtually
22   every time the use of catalyst technology has been
0063
 1   proposed for use on a spark-ignition engine, be it
 2   an automobile, heavy truck, off road engine over
 3   25 HP, such as a forklift, a motorcycle or moped
 4   or a small engine used on handheld or non-handheld
 5   equipment.  In each case, all of these issues were
 6   successfully addressed for each application.  The
 7   situation is no different in the case of class I
 8   and class II non-road engines.
 9            Both EPA and ARB test programs have shown
10   that catalysts can be applied to class I and
11   class II engines without increasing safety risks
12   associated with exhaust component surface
13   temperatures.  Integration of catalyst into small
14   engine mufflers utilizes uncomplicated
15   manufacturing techniques that should allow for the
16   design and validation of compliant engines within
17   the lead time provided by the EPA regulations.
18   The 30 years of catalyst experience in general and
19   the over ten years of experience with applying
20   catalyst to smaller SI on road and non-road
21   engines provide an experience base that has
22   enabled catalyst technology to continue to be
0064
 1   improved.  This small engine experience has
 2   provided an increased understanding of how to
 3   optimize the engine/catalyst/exhaust system to
 4   work effectively, and will facilitate application
 5   of catalyst technology on class I and class II
 6   engines to help meet the proposed standards.
 7            The technology to reduce emission from
 8   spark-ignited inboard and sterndrive marine
 9   engines will be based on automotive type three way
10   catalyst with closed loop control technology.
11   This technology has been used on well over
12   300,000,000 automobiles with outstanding results
13   and the same technologies can be adapted to marine
14   inboard and sterndrive engines.  Here again,
15   results from EPA and ARB respondered test programs
16   detailed in the EPA draft regulatory impact
17   analysis confirm that three way catalysts (TWCs)
18   can be effectively integrated into marine inboard
19   and sterndrive engines, and TWCs have the
20   necessary mechanical integrity and catalytic
21   durability to perform with high emission
22   conversion efficiencies throughout the entire 480
0065
 1   hour useful life emissions requirement for these
 2   marine engines, regardless of operation in fresh
 3   or salt water environments.  Important results
 4   from this demonstration program included the
 5   design and integration of exhaust manifolds with
 6   TWCs that provided relatively low exhaust manifold
 7   surface temperatures (through the use of
 8   water-jacketed exhaust system) and minimized the
 9   potential for water ingestion into the region of
10   the manifolds that contained the TWCs.  Both
11   ceramic and metallic based substrates were used to
12   display a range of three way catalyst formulations
13   as a part of in this durability test program all
14   with good results.  Thus, a variety of TWC
15   technology options used successful in automotive
16   applications were shown to be effective in these
17   marine engine applications.  The early commercial
18   introduction of catalyst equipped marine inboard
19   engine is further proof that catalyst can be used
20   to achieve EPA's proposed HC plus NOx and CO
21   standards for this category of marine SI engines.
22            In closing, MECA sports EPA's proposed
0066
 1   emission standards for new non-road spark-ignited
 2   engines, equipment and vessels.  MECA believes
 3   that the application of catalysts to the small
 4   non-road SI engines and marine inboard and
 5   sterndrive SI engines is a cost-effective solution
 6   for reducing exhaust emissions from these engines
 7   and we are committed to do our part to ensure that
 8   emission control technology is available to help
 9   meet EPA's proposed standards.  We urge EPA to
10   finalize their regulatory proposals for these
11   categories of engines as soon as possible.
12            Thank you very much for your time.
13            MR. WOOD-THOMAS:  Thank you.
14   Mr. Richter.
15            MR. RICHTER:  Good morning.  I'm Wayne
16   Richter manager of marketing development for WC
17   Heraeus, maker of engine exhaust catalyst.  I'd
18   like to give you a snapshot of Heraeus today and
19   convey all our support for the EPA phase three
20   emission regulation.
21            Heraeus at a glance, Heraeus is a market
22   and technology leader in precious metals, dental
0067
 1   health, sensors, quartz glass and specialty
 2   lighting sources.
 3            Our revenues for Heraeus in 2006 were
 4   just over 12 billion dollars with precious metals
 5   trading in the major markets.  In 2006 we employed
 6   over 11,000 employees.  We now employee 1,400 in
 7   China, for example.  We have a worldwide
 8   presence with 76 production facilities and 25
 9   development centers worldwide.  Heraeus is 156
10   year old company in the precious metals business,
11   and they share the distinction with Porsche being
12   a privately owned major sized German company.
13            Just pay attention to the top line of
14   groups of Heraeus first is WC Heraeus and precious
15   metals that the catalyst group is a part of and
16   then Heraeus sensors, Heraeus closer, which is a
17   dental and medical products, quarts glass,
18   specialty lighting sources.
19            Next I will have a very brief video with
20   the corporate overview to help explain our
21   commitment to this industry.
22            The catalyst in group four, Heraeus is
0068
 1   part of the chemical division.  I'll draw your
 2   attention to point three, Heraeus is a world
 3   leader in the refining of all platinum group
 4   metals.
 5            And just to mention the precious metal
 6   cycle, Heraeus does a refining of primary precious
 7   metals and secondary precious metals.  About 78
 8   percent of precious metals are recycled.  Of
 9   course, through our trading group, new precious
10   metals are added to make the cycle.
11            The four major markets that Heraeus
12   participates in for catalyst are the automotive
13   aftermarket.  Catalyst for diesel particulate
14   reduction, motorcycle and motor sports catalyst.
15   And then while we're here today to talk about
16   primarily a small engine exhaust gas treatment.
17            Our small engine solutions provide a
18   variety of different catalyst solutions.  We
19   provide effective conversion of the bad stuff
20   coming out of the engine.  We have catalyst which
21   match the durable needed, in other words,
22   addressing the DF factor for the engine
0069
 1   application.  And an engine exhaust catalyst is
 2   really quite a cost-effective approach.
 3            Our experience with small engines, our
 4   experience really started in 1991, now 16 years
 5   ago.  Today we supply millions of catalysts each
 6   year to the outdoor power equipment industry.  We
 7   provide continuous coordination for this market,
 8   coordinating with equipment, engine and muffler
 9   makers.  And Ron Lloyd discussed before the need
10   for this and our industry.
11            Next is extensive technical experience
12   with a wide variety of small displacement
13   spark-ignition engines.
14            Heraeus is very supportive and a member
15   of OPEI fuel and exhaust Clean Air Act Committee
16   contributions as you heard about earlier.  We are
17   a member of MECA, with our membership and workshop
18   participation.
19            We support the proposed EPA tier three
20   emissions regulations for class I and class II
21   off road spark-ignition engines.
22            Heraeus is ready and believes this rule
0070
 1   should be finalized as soon as possible.  Thank
 2   you.
 3            MR. WOOD-THOMAS:  Yes, we have a few
 4   questions.
 5            MR. PASSAVANT:  Wayne, I wanted to ask a
 6   clarification question on your second to last
 7   slide, the one before this where you said you sold
 8   many -- I think the words was millions.
 9            MR. RICHTER:  We sell millions annually.
10            MR. PASSAVANT:  Yes, into this market,
11   can you clarify is that the handheld side of the
12   market or what we call the non-handheld side of
13   the market and if so, where?
14            MR. RICHTER:  Since 2002 for handheld
15   products.  So we're talking about line trimmers,
16   brush cutters, backpack and handheld blowers.
17            MR. PASSAVANT:  I don't want to put you
18   on the spot on this.  I do want a clarification.
19   You're being a German company, it's my
20   understanding that in Europe there are certain of
21   European states have requirements for catalysts
22   based systems and some of their walk behind
0071
 1   equipment.  Have you been involved in that market
 2   at all?
 3            MR. RICHTER:  We have supplied catalysts
 4   for European green products, if you will.  We've
 5   supplied nearly a million, there's been nearly a
 6   million walk behind motors produced with catalyst
 7   in Europe for that product.
 8            MR. PASSAVANT:  Are you aware of any
 9   problems, performance issues or anything related
10   to that?
11            MR. RICHTER:  None whatsoever.
12            MR. WOOD-THOMAS:  Thank you.  If we can
13   proceed with panel four, Todd Rogers, Arkema, on
14   behalf of Solar Plastics; Robert Porter, INCA
15   Modeled Products, Tony Riviezzo, Promens, Inc. and
16   Dan Grimes, Centro and also Mike Freeman.
17            MR. ROGERS:  I will be doing a
18   presentation but there are copies of the
19   presentation outside on the table if you would
20   like to get that.
21            Good morning, I'm Todd Rogers.  I'm the
22   Industrial Market Development Manager for Arkema,
0072
 1   Inc.  I represent the PetroSeal low permeation
 2   bi-layer rotomolding tank technology that is
 3   currently CARB approved for the executive order
 4   through a manufacturer of small off road and
 5   recreational equipment tanks.  And we believe that
 6   same technology could be used to manufacture both
 7   the lawn and garden tanks as well as applicable to
 8   that rotomolding tank market.
 9            Let me briefly describe what exactly is
10   PetroSeal.
11            PetroSeal is, we're really focused on
12   helping tank manufacturers meet the evaporative
13   emission standards that EPA promotes and consists
14   of two layers.  PetroSeal is a bilayer of system
15   used for rotation molding of fuel permeation
16   resistant tanks.
17            The inside layer consists of a Rilsan
18   Polyamide 11.  This specialty nylon gives
19   excellent resistance to fuel permeation.  It's
20   currently used in a number of automotive fuel
21   lines.  We sell into that market quite a lot.  It
22   is a tough impact resistant polymer, engineering
0073
 1   polymer with a melting point of 185.  It's
 2   dimensionally stable and molds very easily.  It's
 3   manufactured from a renewable resource.  It's 100
 4   percent bio based from a vegetable oil.
 5            The outer side of the layer is PetroSeal
 6   metallized polyethylene.  It has an excellent
 7   resistance to alcohol permeation.  It molds very
 8   easily.  We partner and join these two materials
 9   to synergy so you get hydrocarbon as well as
10   alcohol resistance.  It's also very tough but one
11   of the important features is that these two
12   materials are specially developed to adhere to one
13   another.  That way when you drill through a tank
14   or add several fittings, you don't worry about
15   fuel permeation between the layers.  So the layer
16   adhesion in our system is very, very important.
17   It ensures the structural integrity of the tank
18   and ensures minimal permeation.  As a result tanks
19   manufactured with PetroSeal are very low
20   permeation, very tough and cost-effective.
21            If I didn't specify at the beginning,
22   Arekma manufacturers the resins and we'd be
0074
 1   willing and eager to help any tank manufacturer,
 2   manufacture tanks with our technology and thus
 3   meet the regulations.
 4            Just a quick history of PetroSeal
 5   achievements.  Currently the PetroSeal technology
 6   meets current EPA permeation regulations as tested
 7   by EPA laboratories, testing in 2005 confirmed that
 8   permeation rates of 0.76 grams per meter squared
 9   per day were validated by EPA.
10            We have a California Air Resources Board
11   exemption for the small off road and recreational
12   vehicle tanks.  We received that in 2005.  That
13   was the minimum average thickness Rilsan PA11 at
14   one millimeter and PE at three millimeters.
15            PetroSeal was granted the first
16   technology exemption under CARB.  The tanks for
17   those that are manufactured and interested in the
18   marine side, meet US Coast Guard requirements for
19   mechanical strength, fire resistance for
20   permanently installed marine fueled tanks.  We
21   have a ten gallon and 40 gallon manufactured and
22   tested by Imanna labs.
0075
 1            The lawn and garden fuel tank -- excuse
 2   me, we had tanks manufactured for the lawn and
 3   garden industry that do passes the SAE J288
 4   snowmobile impact test.  You see the physical
 5   requirements there.
 6            Tanks that were made that were tested here
 7   were manufactured by Solar Plastics.  We have made
 8   several very successful trials in a number of
 9   roto molders.
10            Finally, I want to comment on commercial
11   viability.  PetroSeal is a commercially active
12   technology today.  We do have many applications
13   which are qualified.  And we do have commercial
14   sales.  It's very important to note that obviously
15   we all may be familiar that the EPA has also
16   enacted motorcycle regulations.  And we are
17   selling motorcycle tanks or the technology into
18   the motorcycle industry today with tanks that meet
19   those regulations.
20            In conclusion I have some data.  I was
21   told to keep it very brief.  Essentially Arkema's
22   position is we generally don't like to take sides,
0076
 1   per se, to vote for or against the regulation.
 2   What we are here to do is develop specialty
 3   materials to help those that will be affected by
 4   those regulations meet the impending regulations.
 5            We look forward to working with any
 6   molders or any OEMs to better understand our
 7   technology and find out how we can help you comply
 8   with the regulations that are due to be imposed.
 9   Thank you.
10            In addition to I've been asked to read a
11   some commentary from Solar Plastics.
12            Good morning, my name is Gary Engen.  And
13   I am Vice President of Engineering for Solar
14   Plastics, Inc., headquartered in Delano,
15   Minnesota.  Solar Plastics has been a technology
16   leader in rotational molding for over 40 years.
17            I thank you for the opportunity today to
18   provide testimony about the feasibility of
19   manufacturing low permeation plastic fuel tanks
20   using the rotational molding process.  I also
21   thank our valued supplier and development
22   partners, Arkema, Inc. for presenting this
0077
 1   testimony on our behalf.
 2            Solar Plastics has conducted an active
 3   research and development effort for many years.
 4   Numerous tooling, material, and processing
 5   concepts have been invested, evaluated or
 6   optimized in our test facility.  One of the
 7   outcomes has been to gain expertise in molding
 8   multi-layer rotational molded parts.  This
 9   expertise, along with a corporate directive to
10   explore emerging technologies, has enabled Solar
11   Plastics to become a natural development partner
12   with Arkema in the area of permeation resistant
13   material systems.
14            At Arkema's request, Solar Plastics
15   readily agreed to provide access to equipment,
16   technicians, and engineering resources in an
17   effort to rotationally mold fuel tanks meeting
18   California Air Resources Board standards for small
19   off road equipment.  This activity resulted in the
20   award of SORE Evaporative Component Innovative
21   Product Executive Order for Arkema's PetroSeal
22   Material System.
0078
 1            Solar Plastics has established safe,
 2   reliable and consistent processes to mold the two
 3   layer PetroSeal Material System.  Molded tanks
 4   exhibit excellent adhesion between layers, impact
 5   strength that meets various industry standards and
 6   permeation resistance well within proposed
 7   standards.  Molding methods are cost efficient,
 8   and utilize the same tooling and machinery that
 9   produce single layer tanks.  PetroSeal fuel tanks
10   molded by Solar Plastics satisfy durability
11   requirements adopted by the marine, and lawn and
12   garden equipment industries.  These include
13   ambient and cold temperature impacts and burn
14   tests.
15            In conclusion, Solar Plastics clearly
16   states that technology is available today to
17   rotationally mold fuel tanks that meet the
18   proposed evaporative emissions standards.
19            Respectfully, Gary Engen, VP of
20   Engineering for Solar Plastics, Inc.
21            MR. WOOD-THOMAS:  Thank you.  Mr. Porter.
22            MR. PORTER:  Good morning, my name is
0079
 1   Robert Porter.  I am the president and owner of
 2   Inca Molded Products.  Inca Molded Products was
 3   founded in 1979 by my father, James Porter, who
 4   developed the first successful plastic fuel tank
 5   for the marine industry.  Rotationally molded
 6   marine fuel tanks represent 90 percent of our
 7   company's product mix.  We have over 1,000 marine
 8   molds, 150 customers and we have manufactured
 9   millions of tanks whereby their design and
10   materials have stood the test of time, nearly 30
11   years.  Inca does support the need for control of
12   evaporative emissions through low perm fuel tanks,
13   diurnal emission controls and low perm hose.
14   However, due to the direct correlation our
15   products have with boating safety, we want to be
16   sure that the requirements of this standard do not
17   create a low emission product that is inferior in
18   quality to the current product that has been
19   successful in the marine industry for years.
20            Low permeation fuel tanks, Inca agrees
21   with EPA that the most favorable approach to low
22   perm fuel tanks, at this point, is multi layer
0080
 1   construction.  We have run multiple trials with
 2   front-running technologies and we have more trials
 3   scheduled for July 2007.  These are the kinds of
 4   things we have encountered:  Inconsistent impact
 5   strength, too narrow of a processing window,
 6   causing 90 percent scrap rates, fitting leaks,
 7   difficulty to repeat in production in process
 8   operations needed to be provide adequate and
 9   uniform second layer coverage.
10            This is what we need:
11            The suppliers of these products need to
12   continue refining their materials.  None of them
13   are commercially available or readily processable,
14   although some have passed CARB requirements.
15            We need more time for internal testing.
16   As a marine fuel tank rotomolder, and all the risk
17   associated with that, we are testing to see that
18   the multi-layer materials hold up to the demanding
19   areas of the process variables, mold variables and
20   design variables that Inca works with day in and
21   day out.
22            We need more external testing data on
0081
 1   multi-layer tank models from outside labs on
 2   mechanical strength tests that are required by
 3   H-24.  Inca has tested and passed thousands of
 4   tanks over the years to H-24.  It takes time and
 5   cumulative experience and knowledge to get it
 6   right.  A few tanks sent out to test for H-24 is
 7   not an adequate representative of the market.
 8            We need and support permeation testing
 9   certification program that would require a design
10   based approach.  This would enable us to qualify
11   families of tanks that are grouped by size or
12   shape similarities.
13            Finally, we need marine field testing
14   data.  We need special measures or a tank phase in
15   period.  This would limit the number of new tanks
16   going into the field in order to contain our risks
17   of unexpected performance issues that may arise
18   from uncharted waters of rotationally molded
19   multi-layer fuel containment.
20            Carbon canisters, Inca supports carbon
21   canisters to lower diurnal emissions.  Inca has
22   had multiple meetings with Mead Westvaco and
0082
 1   Delphi to understood the carbon canister and its
 2   requirements as we best know them in the marine
 3   environment.  Although this has been done in the
 4   automotive industry, we have been carefully
 5   evaluating the adaptability to the marine fuel
 6   system.  Inca has reached and determined that it
 7   will not be possible to install just a carbon
 8   canister without other changes.  We have concerns
 9   about applying the canister technology without
10   making these changes, clogged canisters would
11   result in safety hazard.  The changes that we are
12   most familiar with involve multi purpose fittings
13   that create new attachment methods to the tanks.
14            We need the new fitting systems require
15   new methods of attachment.  There are options but
16   we need time to make hold fitting insertion
17   changes and perform comprehensive testing.  The
18   fitting is very critical part of the tank that
19   must not leak.
20            The purpose of the fittings are to keep
21   the canister dry, prevent spit back or well back,
22   and provide ullage.  The industry needs fill
0083
 1   nozzles that will provide automatic shut off at
 2   marinas, and we will need time to verify the
 3   durability of these fittings as installed in boats
 4   that are constantly in and around water and salt
 5   water.
 6            The first cross link polyethylene fuel
 7   tank was invented by another manufacturer in the
 8   early '70s.  Within two years the fuel tanks began
 9   failing in the field and resulted in a national
10   recall and all the tanks had to be removed out of
11   the boats.  Inca pioneered the first successful
12   plastic fuel tank by researching, redeveloping,
13   and building on the mistakes the first
14   manufacturer made.  Even though all the tests were
15   run, the tanks didn't hold up to the conditions in
16   the field.  Inca tested, tested and tested more.
17   We ran many tests which were not required that
18   went over and above the requirements.  Then the
19   plastic tanks were phased in slowly.  Inca sold
20   small tanks in limited models.  This would give
21   cross link poly fuel tanks the time they would
22   need in the field to gain confidence and make any
0084
 1   necessary adjustments.  We at Inca Molded Products
 2   have spent our entire existence building a
 3   reputation through demonstrated performance that
 4   is based on making tanks that do not fail.  The
 5   containment of fuel and vapors on a boat is
 6   critical and something that we take very
 7   seriously, thus, Inca's dedication to developing
 8   the best solution for the marine industry.  Thank
 9   you.
10            MR. WOOD-THOMAS:  Thank you.
11   Mr. Riviezzo.
12            MR. RIVIEZZO:  Good morning, my name is
13   Tony Riviezzo.  I am the Technical Director for
14   Promens North America.  I have over 18 years of
15   experience in design, engineering, and sales of
16   marine fuel tanks.  Promens is primarily a
17   rotational molding company, who is just getting
18   its feet wet in the marine fuel tank market.
19            Prior to summarizing a few concerns I
20   have with this rule, I would personally like to
21   thank the many people at EPA whom have worked
22   conscientiously with the marine industry to
0085
 1   formulate a rule that addresses the issues related
 2   to our recreational business.  Despite our
 3   difference of opinion in the beginning, both Glenn
 4   Passavant and Mike Samulski have worked to make
 5   this new rule something that works to not only
 6   benefit the environment but also the recreational
 7   boating industry.
 8            The first area of the rule I am providing
 9   comment on is:  Section 1045.145(d) and 1054.145
10   (g), useful life for evaporative emissions
11   standards.
12            Under these two sections an interim
13   provision is being offered for a limited time of
14   two years for marine SI and small SI fuel tanks
15   through 2013 to allow manufacturers to gain in use
16   experience.  This offer is greeted with open arms
17   but does not give the fuel tank manufacturers
18   enough in field use experience as you might
19   believe.  A typical marine fuel tank may be
20   manufactured in March, is shipped and stored at
21   the boat manufacturer for up to three months, then
22   installed into the vessel.  The vessel is stored
0086
 1   as a finished product at the boat manufacturer for
 2   one to two months, it is shipped to a dealership
 3   and then sits in storage for as long as six months
 4   until it is sold at a retail level.  A typical
 5   scenario may place the tank from date of
 6   manufacture to end user in four to 11 months.
 7   This lowers our field experience level down to
 8   only a little over one year.  Many boat owners
 9   only use their boats on weekends and only for
10   three to five months of the year.  As you can see,
11   true in field use could be reduced to as little as
12   three to six month time frame in the two years
13   provided by this provision.  I would request that
14   this provision be extended to three years to give
15   us a true measure of at least two working seasons.
16            The second area of the rule I am
17   providing comment on is section 1060.520, how do I
18   test fuel tanks for permeation emissions?
19            Under this section I have three comments:
20   Paragraph (a), preconditioning durability testing.
21   One segment of durability testing that should be
22   included is an integrity test of the tank shell
0087
 1   itself.  My experience is that some of the barrier
 2   layer materials may increase the brittleness, thus
 3   lowering the impact engineer needed to create a
 4   ductile failure of the tank shell.  The
 5   photographs attached show the effects of dart
 6   impacting as defined in the test parameters of the
 7   association of rotational molders.  This test was
 8   developed to insure the integrity of the molded
 9   plastic material even in cold weather
10   environments.  This standardized test is used by
11   most rotational molders as a means for quality
12   control.
13            The US Coast Guard in Boat Safety
14   Circular 79 makes the following statements:  "The
15   biggest advantage with the use of non-metallic
16   fuel tanks is that they do not corrode.  And if
17   they are properly manufactured and installed, they
18   should last for the expected service life of the
19   boat.  As a result, any owner of a boat with
20   metallic tank which has failed should consider a
21   replacement tank constructed of PE."  The key
22   words in this statement are properly manufactured.
0088
 1   Use of the dart impact test, also known as the
 2   Bruceton Staircase Method, has proven to ensure a
 3   safe and reliable product.  With more than three
 4   million rotationally molded cross link
 5   polyethylene fuel tanks produced in over 27 years,
 6   ductile failures are nearly non-existent.  Dart
 7   impact testing has contributed to this success
 8   rate when used as a measure of material and
 9   manufacturing performance.
10            As you can see from the photographs, the
11   effect of the peculiar barrier layer causes
12   significant flexibility changes in the cross link
13   polyethylene shell, lowering its impact
14   resistance.  One area we should not degrade for
15   environmental benefits is personal safety.
16   Impacts to the tank such as mishandled, poor
17   transportation, manufacturing accidents or in
18   field use should not result in a lower expectation
19   of performance.
20            One example of the resilience and safety
21   of current of rotationally molded fuel tanks, is
22   an accident where a boater hit a pier piling
0089
 1   splitting the boat in nearly half.  The boat came
 2   to rest with the piling halfway through the length
 3   of the boat with the rotationally molded fuel tank
 4   wrapped around the piling.  As the testament to
 5   the safety of the fuel tank, there was no fuel
 6   loss in the accident.
 7            Crash impacts testing such as described
 8   in SAE J 288, snowmobile fuel tank impact test or
 9   SAE J 1241 motorcycle fuel tank lateral impact test
10   do not directly test the integrity of the
11   material.  These tests only verify the integrity
12   of the mounting of the tanks within structures.
13   Both SAE tests described have the tanks mounted to
14   structures which are impacted, the tanks are not
15   directly impacted.  Bob White of Imanna
16   Laboratory, Inc. feels that neither of these tests
17   would provide the same level of comfort or
18   security as would the dart impact test I have been
19   describing.  No part of either SAE test described,
20   verifies that an inner barrier layer is bonded or
21   is mechanically attached to the outer shell.  Dart
22   impact testing would make this determination.
0090
 1            I believe we would be reluctant in our
 2   duties if we fail to include dart impact testing
 3   as a part of the requirements and not let this
 4   type of integrity test be at the discretion of the
 5   fuel tank manufacturer.
 6            Paragraph (b), preconditioning fuel soak.
 7   As I read this section of the proposed rule my
 8   attention was drawn to the requirements concerning
 9   caps after refueling during a preconditioning
10   testing.
11            Item (5)(i) under this paragraph states,
12   "You may seal the fuel inlet with a non-permeable
13   covering if the fuel tank is designed to have a
14   separate filter neck between the fuel cap and the
15   tank, and the filler neck is at least 12 inches
16   long and has an opening at least six inches above
17   the top of the tank."  This statement confuses me
18   as nearly all permanently installed marine fuel
19   tanks have fill necks molded to the tank that are
20   less than four to five inches long, and are
21   attached to the cap via a flexible hose.  The fuel
22   tank has neither a filler neck of 12 inches long
0091
 1   or has an opening higher than six inches above the
 2   fuel tank.  The way I read this is that nearly all
 3   permanently installed fuel tanks would have to be
 4   tested with a fill cap.  As a tank manufacturer,
 5   we do not sell or specify fill caps, nor do we
 6   know what the boat manufacturer's intention or
 7   specification is to that cap.
 8            Item (5)(ii) states,  "For filler necks
 9   not meeting the specifications described in
10   paragraph (b)(5)(i) of this section, take one of
11   the following approaches:  Approach A requires me
12   to test with a cap that will emit the highest
13   level expected to be used with fuel tanks.
14   Approach B allows me to seal the opening if I
15   measure the permeation from the worst case fuel
16   cap.
17            It appears to me that unless I make a
18   filler neck directly part of the fuel tank that is
19   12 inches long or has been opening higher than six
20   inches above the tank, I must test with a cap or
21   accept the higher potential permeation values from
22   the worst case fuel cap.  This cap permeation
0092
 1   burden could turn a fuel tank compliant to the 1.5
 2   g/m2/day requirement into noncompliant fuel tank.
 3   Fuel caps unless directly part of the tank either
 4   by threads or mechanically attached should be
 5   tested on their own.
 6            Paragraph (c), reference tank -- I am
 7   unclear if a reference tank for the test of a
 8   medium to large sized permanently installed marine
 9   fuel tank is capable of defining weight change at
10   such low comparisons of loss when compared to the
11   total sample weight.  Details concerning a 50
12   gallon and 100 gallon marine fuel tank are defined
13   in the graphs.
14            In the case of the 50 gallon tank we are
15   looking at 3/100 of a percent change in weight and
16   in the case of the 100 gallon tank, we are looking
17   at just over 25/1000 of a percent change.  I am
18   just looking for clarification on whether the
19   slight differences are measurable.
20            I would like to thank the EPA and all of
21   those present for this opportunity to speak.  I
22   would appreciate any consideration on the issues I
0093
 1   have made comment on.
 2            MR. WOOD-THOMAS:  Thank you.  Mr. Grimes.
 3            MR. GRIMES:  My name is Dan Grimes.  I'm
 4   representing Centro, Incorporated.
 5            A brief description of the company.
 6   Centro has been in rotational molding since 1970.
 7   We are the largest custom of rotational molder
 8   in the United States.  We've been manufacturing
 9   fuel tanks for 35 years.  The headquarters is in
10   Iowa.  And we also have other major locations in
11   North Carolina and Wisconsin.  Approximately 670
12   employees and 29 molding machines.
13            I don't have this on the slide but we are
14   one of the few rotational molding companies with
15   national dedicated research and development
16   department.
17            Currently there are four California Air
18   Resource Air Board rotomolding solutions with
19   executive orders.  The web link is above there.
20   Number one is C-U-06-028, Centro's roto low perm
21   technology.  Number two is Centro's RAL
22   technology, that's standards for rotationally --
0094
 1   I'm sorry, rotational anionic linearization.
 2   Number three, Centro's proprietary technology.
 3   And number four, Todd Rogers addressed Arkema's
 4   PetroSeal technology.
 5            Centro has access to these four executive
 6   ordered CARB solutions.  And we choose the right
 7   solution based on requirements such as cost, UV
 8   exposure, mechanical properties, et cetera.
 9            Just a little more detail about the roto
10   low perm.  This was developed by Centro by a
11   molder.  It is a multi-layer solution that
12   utilizes cross link polyethylene.  Cross link
13   polyethylene has been discussed already.  It is
14   the material chose for most rotomolded fuel tanks
15   today.  Cross link is used because of its
16   excellent mechanical properties and its ability to
17   mold to complex parts.  This material has a very
18   high melt flow index before it cross links
19   allowing easy fill thread profile and such.  Retro
20   low perm is trademark and patent pending.
21            Our testing has shown, that it exceeds
22   CARB and EPA emission standards using CE10 fuel at
0095
 1   40C.  Our executive order states that we must be
 2   below 0.75 grams per meter square per day for
 3   the -- that's for the three Centro CARB solutions.
 4            Briefly, about the implement dates, EPA
 5   preamble page 134 states that the installed
 6   rotational molded marine fuel tanks receive an
 7   additional year of lead time, 2012, because of
 8   greater design challenges.
 9            We believe that the additional lead time
10   is not necessary as the rotational molding
11   solutions presented in these slides are capable of
12   producing complex standards that meet emission
13   standards as well as marine standards.
14            In addition Centro and Arkema have
15   invested significant time and resources to prepare
16   for the forthcoming CARB and EPA evaporative
17   emission regulations.
18            Between the two companies there are
19   multiple low emission solutions offered that will
20   meet CARB and EPA emission standards while
21   maintain the mechanical performance.
22            Concerning the fuel cap certification,
0096
 1   currently fuel cap suppliers or manufacturers have
 2   minimal regulations concerning the materials they
 3   use, whether it's nylon or polyethylene.
 4            Fuel tank molders have no control over
 5   the cap design, the materials used or the
 6   manufacturing, specifically the quality control.
 7   Combining the tank and cap certification creates
 8   conflict of liability.
 9            If a tank is tested and does not meet the
10   EPA requirements or CARB requirements, who is
11   responsible for that, the fuel tank manufacturer
12   or the fuel cap manufacturer, if the source of
13   higher emissions is determined to be at the cap
14   seal?
15            Centro requests EPA to require cap
16   manufacturers to certify permeation performance of
17   fuel cap gasket assemblies separately as suggested
18   in EPA section 1060.521.
19            In summary, there are currently four
20   rotomolded low permeation solutions offered today.
21            Significant resources have been invested
22   in developing these technologies.
0097
 1            Additional lead time for marine
 2   regulations is not necessary based on rotational
 3   molding tanks not being prepared.
 4            And the request has been made to require
 5   cap manufacturers to certify fuel cap gasket
 6   assemblies.
 7            Contact information for Centro, the basic
 8   web page.  For sales and inquires and technical
 9   questions.  WWW.CentroInc.com.
10            I want to thank you all for allowing me
11   to present today.
12            MR. WOOD-THOMAS:  Thank you.
13   Mr. Freeman.
14            MR. FREEMAN:  Thank you very much.  We're
15   pleased to be here today.  Harold Haskew, actually
16   advised us of this meeting just recently.  And as
17   Global Safety Labs, which I'm the CEO of has just
18   recently acquired the rights to a vaporless fuel
19   cell which is a double bladder system that's
20   mentioned in the EPA draft report at section
21   5.1.8 and as found on page 5-24.
22            Global Safety Labs calls those double
0098
 1   bladder vaporless fuel system the zero cell
 2   vaporless.  And it is a fuel tank insert system.
 3   We're here with the fuel tank manufacturers.
 4   Actually we have a double wall bladder that goes
 5   inside the hard shell fuel tanks.
 6            Global Safety Labs strongly agrees with
 7   the EPA's assessment that the zero cell is
 8   probably the most effective technology for
 9   reducing evaporative emissions.
10            We've made some changes in the vaporless
11   fuel cell.  And recently we have gone into
12   production in the vaporless fuel cell or zero cell
13   for HumVees that are scheduled for the war theater.
14            We have just a short clip of the changes
15   and showing the demonstration of the double
16   bladder system.
17            (Showing video.)
18            Global Safety Labs presents the
19   revolutionary new products.
20            Hello, my name is Bill Peterson.  I was
21   formerly the engineering group manager for fuel
22   systems and advanced fuel systems at General
0099
 1   Motors.  At that position at General Motors was
 2   where I was first introduced to the vaporless fuel
 3   cell.
 4            In theory the vaporless fuel cell is a
 5   double bladder system.  The outside bladder
 6   contains arctic/fire freeze while the inside
 7   bladder contains the liquid fuel.  The outside
 8   bladder continually depresses the fuel bladder
 9   which prevents vapor from forming and accumulating
10   inside the vapor fuel cell.
11            To gain credibility for future testing we
12   retrofitted the vaporless fuel cell into a GM
13   passenger vehicle.  We then tested the vehicle,
14   equipped with the vaporless fuel cell and we
15   targeted several key areas of emission compliance.
16            Probably the most key area that we
17   targeted is a test known as the three day diurnal
18   SHED emission test.  This is a test where you take
19   a vehicle, enclose it into a controlled
20   environmental chamber for three days, cycle the
21   temperature up and down, which induces vapor
22   generation and then capture and measure the
0100
 1   escaping vapors into the chamber which normally
 2   would be escaping vapors into the environment.
 3            We found that the test results were
 4   remarkable.  The test vehicle equipped with the
 5   vaporless fuel cell exceeded the standards by huge
 6   factors.
 7            We also tested the vaporless fuel cell on
 8   what's called an on board refueling vapor recovery
 9   test which essentially captures the vapors on a
10   fueling refueling operation.  Once again, since
11   the vapors were minimized, the results showed
12   remarkable test results, exceeding standards by a
13   huge margin.  These test results convinced me that
14   the vaporless fuel cell needs to plain and simply
15   get to market, whether it's in military vehicles
16   race cars, boats, airplanes, storage tanks or
17   passenger cars.  The applications are endless.  We
18   need to get them to market, for two reasons,
19   really, one, the environment agreement issue,
20   which I just discussed where there's no vapor
21   generation, therefore no vapor emissions, but also
22   two, from a safety stand point.  With no vapors,
0101
 1   you have no dramatic explosions.
 2            MR. FREEMAN:  Next we have just a few
 3   seconds of an accelerated evacuation of a
 4   vaporless fuel cell.  This is actually in the fuel
 5   tank.  And it is cut away for the purposes of
 6   viewing.  This is military HumVee N998, a fuel tank
 7   that has been retrofitted with the vaporless,
 8   double bladder fuel cell.  As you see as the fuel
 9   is expended, the double bladder system because of
10   the hydrostatic pressure on the outside bladder
11   which is 10 percent of the volume and the liquid,
12   is on the inner bladder which is 90 percent of the
13   volume because the specific gravity of the liquid
14   or arctic fire freeze which is a fire suppression
15   liquid and permeation barrier liquid, is the
16   specific gravity is heavier than the specific
17   gravity of the gasoline and because the
18   hydrostatic pressure of both bladders working
19   together.  As the fuels expend into the fuel rail
20   the bladders both compress and there is no
21   generation of fuel vapors.
22            This is actually the HumVee that we were
0102
 1   equipping for later on today working with the
 2   military to finalize there the configuration they
 3   want accepts the same fuel rail configuration.  We
 4   use a different gauging mechanism that has a
 5   different sensor but our sensor can be calibrated
 6   to work with any existing gauge.  We would
 7   respectfully request that the EPA consider we know
 8   this product was around with the previous owner
 9   for a previous years.  We have taken it and having
10   had made changes and additional developments to
11   it.  It is on order through the United States
12   military at this time.
13            And we would ask that the EPA consider a
14   system, continue the system where there would be
15   credits given for the manufacturers who wanted to
16   use a more advanced technology which works on the
17   evaporative side of the diurnal run time vapor
18   emissions to get this product into the market
19   which will either more dramatically more than the
20   charcoal canister reduce vapor emissions.  We
21   would like to see the credits for that.  We do
22   have some concerns about the canister in the
0103
 1   passive configuration that was set up, whether
 2   that will succeed in a real life environment.
 3            Our primary recommendation is that all
 4   incentives, the due consideration and same is
 5   given for manufacturers to begin using the double
 6   bladder systems which will prevent evaporative
 7   emissions from diurnal and the run time.  Thank
 8   you.
 9            MR. WOOD-THOMAS:  Thank you.  No
10   questions for this panel.
11            MR. PASSAVANT:  I have a few.
12            MR. WOOD-THOMAS:  Glenn, go ahead.
13            MR. PASSAVANT:  On your bond testing, I
14   want to ask, Mr. Porter, how would you propose
15   that be pursued within the structure of this
16   regulation?
17            MR. PORTER:  I didn't comment on that.
18            MR. PASSAVANT:  I'm sorry, Tony, how
19   would you propose that be pursued within the realm
20   of this regulation?
21            MR. RIVIEZZO:  Either as part of the
22   preconditioning test that there be an arm impact
0104
 1   test done on materials at both, you know, a low
 2   and ambient temperature range or actually
 3   including it as part of the ABYC on MASA's side
 4   of the regulation that it becomes part of the
 5   durability test there.
 6            MR. PASSAVANT:  Normally speaking, when
 7   there's an industry standard like you have here,
 8   we wouldn't pursue putting that in regulation for
 9   the reasons you guys are all over it.  You know
10   what you seem to be doing.  Maybe the ABYC
11   approach would be the right way to think about
12   that.  We'll take that under further
13   consideration.
14            I also wanted to ask, Mr. Porter, you
15   mentioned in passing, I don't want to focus on a
16   small point you made, but I want to understand
17   especially what Mike said in passing again, about
18   concerns about canister performance.  You used the
19   term clogging.  And I wasn't quite sure where you
20   were going with that expression there.
21            MR. PORTER:  If you don't use new
22   fittings and additional multi purpose fittings and
0105
 1   fuel, I mean, the canister clogs with carbon.
 2            MR. PASSAVANT:  So this would be if
 3   liquid got into the carbon bed?
 4            MR. PORTER:  Yeah.
 5            MR. PASSAVANT:  And is there not -- in
 6   the affirmative sense, almost all the history of
 7   this type of technology used shows in some form or
 8   another, there is some form of a little valve of
 9   fitting or some type used normally called a liquid
10   vapor separator, or the equivalent thereof.  I'm
11   assuming what you're referring to when you say a
12   fitting that's necessary to be sure that happens.
13            MR. PORTER:  Yes.
14            MR. PASSAVANT:  That is a pretty well
15   understood thing.  Mike, do you have anything you
16   want to add to that?
17            MR. FREEMAN:  Well, the concern was that
18   on the charcoal canister, if the hydrocarbons are
19   fully attached to the charcoal, that the passage
20   system you're suggesting whether or not that will
21   work.  It might work an hour or two but it
22   wouldn't really work long time.
0106
 1            I was -- I have my expert here, I was
 2   mentioning to him that in Oklahoma, you're not
 3   going to get the cooling temperatures that is
 4   considered to make the canister actually work
 5   unless you tell everybody to put the canister in
 6   the ice chest, then you might get the cooling you
 7   need.  We don't get 60 degree temperatures
 8   generally in Oklahoma to do the -- in the
 9   summertime at least where everybody is using their
10   boats to actually go through your passage where
11   the hydrocarbons would leach off of the carbon and
12   reabsorbed as a liquid down into the fuel system.
13            MR. PASSAVANT:  In our rule we did some
14   testing work to assess the effect the air of the
15   temperature swing on this loading and cooling
16   cycle.  If you have any comments for the record or
17   maybe even later on about how to better get a
18   handle on it, that what would have be helpful to
19   us.  Now it's our sense you live and die by the
20   same physical cycle.  If you're using passive
21   purge, it requires a general temperature swing.
22   And what we have seen in some of the stuff that
0107
 1   Mr. Haskew generated a number of years ago, that
 2   was vessels sitting in the water, the temperature
 3   swing was substantially subdued compared to the
 4   ambient atmosphere.  That was one of the things we
 5   went to in the test cycle to try to accommodate
 6   that.  Anything you can add to our understanding,
 7   that would be helpful.
 8            MR. FREEMAN:  Thank you.  Before the end
 9   of the comment session, we'll add comments to the
10   record.
11            MR. WOOD-THOMAS:  At this juncture we're
12   going to deviate from our planned set of speakers
13   really as a courtesy to some of the logistic
14   complaints people are facing.  What I'd like to do
15   is ask Mr. Rich Waggoner from Indmar Marine Products
16   and Mr. Dan Ostrosky of Yamaha Motor Corporation
17   to come forward for their testimony.  At the
18   conclusion of their testimony we'll evaluate where
19   we are timing wise and move forward.
20   Mr. Waggoner.
21            MR. WAGGONER:  Good morning, my name is
22   Richard Waggoner.  And I am the Director of
0108
 1   Environmental Activity for Indmar Products.  We
 2   are a small manufacturer of gasoline spark-ignited
 3   marine inboard engines located in Millington,
 4   Tennessee.  We employ approximately 100 people and
 5   produce 10,000 marine engines per year.  We are a
 6   small player in an industry that manufactures over
 7   100,000 gasoline marine sterndrive inboard engines
 8   per year.
 9            Indmar has been actively involved with
10   the United States Environmental Protection Agency
11   and the California Air Resources Board for the
12   past 20 years.  We have worked closely with both
13   agencies to ensure any engine exhaust emission
14   standards were both fair and equitable and allow
15   more than reasonable development time.  Indmar was
16   also actively involved in the test program to
17   prove the technical feasibility of catalytic
18   converters on sterndrive inboard engines for their
19   useful life (480 hours) in both fresh and salt
20   water.  We supplied two boats as well as technical
21   support to Southwest Research Institute to conduct
22   the test program.
0109
 1            We support the proposed Federal Emission
 2   Regulations for new marine spark-ignited
 3   sterndrive inboard engines that will substantially
 4   reduce emissions from these engines.  There are a
 5   few areas that we would suggest alternative
 6   language or changes.  Some of these changes are
 7   alternatives discussed in the preamble and some
 8   are proposed to remain common with CARB emission
 9   regulations.
10            The first item Indmar Products would like
11   to see clarified is the definition of small
12   business for the proposed sterndrive inboard
13   engines.  Section III.F.1 of the preamble
14   discusses the small business advocacy involvement
15   with the rulemaking.  It also includes their
16   definition of a small business.  Section III.F.2
17   goes on to define small volume engine manufacturer
18   as 5,000 sterndrive/inboard engines per year but
19   will also consider any manufacturer that
20   meets the SBA definition in section III.F.1.  The
21   5,000 unit small volume engine manufacturer should
22   be removed and use the SBA definition of small
0110
 1   business.  The use of one common definition by SBA
 2   should result in less confusion down the road.
 3            The second item is the test procedure for
 4   the not to exceed zone, NTE zone.  NMMA members
 5   are involved in generating the data to define the
 6   NTE zone and support the concept.  Indmar would
 7   like to see the weighted average method used
 8   instead of the limit per sub zone as discussed in
 9   section IV.C(2) of the preamble.  The use of the
10   weighted average would result in a common
11   procedure for all gasoline marine engines and
12   comprehend the open loop operation of catalyst
13   equipped engines.
14            The third item we would like to comment
15   on is repower.  The replacement of engines in old
16   boats is defined in 1068.20 is supported by
17   Indmar.  This allows us to keep customers who have
18   engine problems with old boats satisfied and still
19   meet the intent of the clean air.
20            We would like to see end of line testing
21   not required for all sterndrive/inboard engines.
22   The OBD-M system implemented for
0111
 1   sterndrive/inboard engines will catch and identify
 2   any engine operating problem that might result in
 3   non-emission compliant engines.  All emission
 4   components as well as the operation of the
 5   catalytic converter are monitored.  Any engine
 6   with a problem will be caught at the end of line
 7   run check and corrected before the engine is sold
 8   to commerce.  This procedure would be common with
 9   CARB.
10            The final item we want to comment on is
11   the grouping of engines into a common engine
12   family.  In section 1045.230(b)2 the cooling
13   system (raw-water versus separate-circuit cooling)
14   could be a family discriminator.  This would
15   double the number of engine families for us with
16   no value added.  We offer most of our engines with
17   raw-water or fresh-water cooling.  The emissions
18   of the engine will not change with either cooling
19   system.
20            I want to thank EPA for their efforts
21   over many years and the opportunity to speak
22   today.  Indmar products supports the enactment of
0112
 1   the proposed Federal sterndrive/inboard exhaust
 2   emissions standards with the above noted changes.
 3            We will offer further explanation of
 4   these items in our written comments.  Thank you.
 5            MR. WOOD-THOMAS:  Thank you.
 6   Mr. Ostrosky.
 7            MR. OSTROSKY:  Thank you.  Good morning.
 8   Actually my morning started about 10:00 last night
 9   getting here, so I'm still going.
10            Good morning.  My name is Dan Ostrosky,
11   Manager Government Relationships Yamaha Motor
12   Corporation USA.  I want to thank the EPA for the
13   opportunity to speak here today.
14            Yamaha Marine USA represents over 2900
15   outboard PWC and jet boat dealers and have engine
16   supply agreements with over 100 independent boat
17   builders here in the US.  For 2007 Yamaha's
18   outboard lineup alone has up to 200 different
19   model variations to choose from to fit all boating
20   life-styles.
21            Yamaha's committed to achieving quality,
22   fuel efficient and clean engines is paramount to
0113
 1   our corporate philosophy.  This is why we are here
 2   today.
 3            As you may have heard by other stake
 4   holders, Yamaha also endorses the NMMA comments
 5   presented today in regards to the proposed Marine
 6   SI Rule however; even the NMMA whose member bodies
 7   encompasses the majority of manufacturers cannot
 8   cover all needs to each individual company.
 9   Yamaha feels that is necessary to impart to you
10   the extensive requirements, man power and
11   production strains that this proposal will place
12   on Yamaha over and above what is discussed by the
13   NMMA member bodies.
14            Exhaust emissions:  In the preamble, EPA
15   has proposed to implement a start date of outboard
16   and PWC exhaust emission levels in model year
17   2009.  To Yamaha, model year 2009 would mean
18   compliance as of April, 2008 production which may
19   come and go without signage of this very
20   rule.  Due to the protracted direction and ever
21   dynamic time frames experienced with this NPRM,
22   our engineering and product planning staff are
0114
 1   respectfully requesting that in order for Yamaha
 2   to reevaluate our current model lineup readjust
 3   the mapping and fuel calculation of current four
 4   stroke technology required to achieve a lower
 5   emission level across our product line and to be
 6   allowed to utilize our emission credits earned in
 7   2006, 2007 and 2008 Tier one, an additional one
 8   year model year lead time will be needed.
 9            This would be model year 2010 which for
10   Yamaha would be production starting April of 2009.
11   At this point all elements of the emission levels
12   including the FEL cap within this proposal would
13   go into effect.  This in essence would disallow
14   the sale of all carbureted two stroke engines from
15   this point on, achieving one of EPA's objective
16   goals.
17            Jet boat:  With the EPA electing to
18   reclassify a PWC engine when it is placed in a jet
19   boat to be certified as a totally different engine
20   and at a more stringent level is confusing to us
21   even though the EPA is aware that compliant
22   technology does not exist for outboard and PWC,
0115
 1   has proven to be quite an engineering challenge
 2   and there appears to be no basis for this
 3   requirement.
 4            After considering discussions with our
 5   engineers to reach a feasibility consensus we
 6   request that if the EPA were to agree on a model
 7   year start date of 2011 (which again, for Yamaha
 8   is April of 2010) for compliance at the inboard
 9   level of 5 GM/KW/HR, this would afford additional
10   time to an already taxed staff to design and build
11   a ground up engine required to meet the target
12   levels presented in the proposal.  As the EPA may
13   be aware, PWC engines utilized in jet boats is a
14   very small quantity, and short runs of catalyst
15   based engines would be cost prohibitive.
16   Therefore, by giving this short additional lead
17   time will have the positive effect of bringing
18   into a lower compliance level a greater amount of
19   PWC engine families to help off set production
20   costs.  Again, by allowing this lead time, the EPA
21   will have championed even further emission
22   reductions over the broad engine spectrum.  A
0116
 1   model year 2011 compliance date (although
 2   aggressive) in Yamaha's view, was agreed upon
 3   internally as this appears to parallel what
 4   the EPA has considered acceptable lead time for
 5   the SD/I members affected by this rule as a result
 6   of new engine block design and feasibility issues.
 7   If the industry is in fact subject to classify PWC
 8   engines used in jet boats as a different engine
 9   then we need the additional lead time.
10            Permeation issues:  Yamaha would like to
11   offer comments on the EPA proposed compliance
12   dates of model year 2008 for outside the cowl hose
13   and under cowl hose.  We are not seeking exemption
14   relief from this however we are requesting
15   additional lead time to comply.
16            Under cowl hose:  Industry discussed at
17   length with the EPA the intricacies of under cowl
18   hoses from the variability of lengths (very short)
19   less than one inch to the more elaborate mandrel
20   shaped extruded hose styles among many other
21   details.  Middle ground was discussed in prior
22   meetings as to, "Phase in approach" to allow for a
0117
 1   30-60-90 percent phase in over a multi year time
 2   frame.  However, since the rule will not be signed
 3   in time for industry to implement the costly
 4   changes, a proposed compliance time frame of one
 5   year after the effective exhaust emission start
 6   date is requested to be confident qualified
 7   material, and hose producers are available.
 8            Outside the cowl hoses ( from installed
 9   boat fuel tank to engine):  Understand that this
10   will in most cases be the responsibility of the
11   boat builder ( except those assemblies supplied by
12   the engine manufacturer) in order to achieve the
13   necessary amount of lead time for the boat
14   building industry to come into compliance,
15   notification via the normal standards channels is
16   the only method along with NMMA certification
17   support and possibly some out reach contact.
18   Given industry's limited methods of information
19   flow, Yamaha agrees with the NMMA's position that
20   the compliance with (outside the cowl) low
21   permeation hose commence with unit sales after
22   July, 2009, however, this compliance date would
0118
 1   not include one necessary component of the boat's
 2   fuel system, the primer bulb.
 3            There may be several ways of achieving
 4   compliance but the technology Yamaha is familiar
 5   with and that can be brought to market in a
 6   reasonable amount of time brings with it their own
 7   engineering challenges.  Producing a compliant
 8   primer bulb that decreases in performance and
 9   requires up to ten times greater force to actuate
10   as the weather cools, is what we are faced with at
11   this time.  Test data will be provided with our
12   written comments, as to load force over
13   temperature.  Given the lack of other available
14   technology, Yamaha proposes that a start date of
15   compliant primer bulb be model year 2011.  As with
16   other products, as material and production
17   capabilities become more prolific, earlier
18   compliance will take hold.
19            Under cowl fuel tanks (small outboard
20   engines).  This particular topic as written in the
21   preamble is unclear to Yamaha as to what is
22   covered.  Are small one to two liter on engine
0119
 1   tanks, subject to the tank permeation standard for
 2   portable fuel tanks or are they not covered under
 3   the proposal?  If intended to be covered, Yamaha
 4   has presented in previous meetings the point that
 5   we would recommend the training of the tank for
 6   storage purposes.  With this practice, tanks
 7   stored with no fuel inside produce very little or
 8   no HC escapement and with the small production
 9   quantities, the EPA staff felt they would take
10   this into consideration and may determine to not
11   cover them in this rule which would allow relief
12   for outboard manufacturers from undergoing a
13   costly treatment to produce little or no
14   benefit.  Yamaha seeks clarification but does at
15   this time understand it to read EPA position,
16   small on-engine tanks under 2 liters are not
17   included in the proposal.  The other technical
18   elements such as auto sealed caps are understood
19   as written and Yamaha will achieve the required
20   designs in the time frame mandated in this
21   proposal.
22            Certification:  Yamaha supports the
0120
 1   design based certification strategies outlined in
 2   this proposal.
 3            In closing, Yamaha does request that
 4   additional efforts between the NMMA and the EPA
 5   continue and that a rule with appropriate and
 6   doable lead times can be arrived at.  Yamaha will
 7   forward additional written comments and support
 8   data in the very near future to the EPA.
 9            Thank you.
10            MR. WOOD-THOMAS:  Thank you.  One
11   question.
12            MR. PASSAVANT:  For, Dan, I'm not clear
13   on one thing.  I understand generically one of the
14   themes across almost all of your statements here
15   is related to the time between the promulgation of
16   the rule and the implementation of the
17   requirement.  There's a bit of a concern I have
18   about that, that is especially on the exhaust
19   emissions for the outboard, where we're talking
20   about 2008 requirement for California and for all
21   intents and purposes, we're talking about
22   identical standards for California, so I would
0121
 1   like to ask you either now or for the record,
 2   whichever you feel more comfortable with, to
 3   explain to us why you could not introduce that
 4   technology nationwide in 2009, which would be one
 5   year after it's introduced in California.
 6            MR. OSTROSKY:  First off technology wise
 7   we don't have every model to cover every type of
 8   use, plain and simple.  We also in the way the
 9   rule as I understand it, eliminates the ability to
10   use any of our earned credits for bringing early
11   compliant engines into the market.  We have
12   agreements with builders, long term agreements
13   that were coupled on HPDI and direct technology
14   that does not meet the 16 gram standard.  That's
15   why we're asking for the additional lead time to
16   get the engine families to offset those products.
17            MR. PASSAVANT:  So is there a difference
18   between that -- I understand that issue -- and a
19   blanket request for the lay of the entire program?
20   I'm still hearing you say is you have one or more
21   models that you have issues with.  And that's
22   something we can work with, I think.  As opposed to
0122
 1   let's delay our whole program for a year, I'm not
 2   understanding that I guess.
 3            MR. OSTROSKY:  We have earned credits
 4   that we have not been able to use.
 5            MR. PASSAVANT:  Because?
 6            MR. OSTROSKY:  Because we bring planned
 7   technologies in.  Now that you're putting a FEL
 8   cap of 50 grams in the rule, we would not be able
 9   to sell any of the -- what I'm going to call the
10   fringe engines that were still under development
11   for clean technology at the factory for one year.
12   And that's what we're asking for.
13            MR. PASSAVANT:  Do you follow that?  I'm
14   sorry, let's talk after.  I'm not following if
15   that 50 gram effects every engine family or only
16   those couple.
17            MR. OSTROSKY:  It effects several
18   engines.
19            MR. PASSAVANT:  But not all?
20            MR. OSTROSKY:  But not all.
21            MR. PASSAVANT:  Thank you.
22            MR. WOOD-THOMAS:  Thank you, gentlemen.
0123
 1   In terms of proceeding and so you can anticipate
 2   accordingly, what we'll plan to do right now is
 3   proceed with panel one, which has two individuals
 4   to speak.  Following panel one, we'll take a break
 5   for lunch and then we'll proceed with panels five
 6   through eight after lunch.
 7            Panel one, Roger Gault, Engine
 8   Manufacturers Association and Nickolaus Leggett.
 9            MR. WOOD-THOMAS:  Mr. Gault.
10            MR. GAULT:  Thank you.  It's still good
11   morning, not by much.  Sorry about the realignment
12   of the schedule, my friendly airline wasn't so
13   friendly this morning.
14            Good morning, my name is Roger Gault.  I
15   am here today on behalf of the Engine
16   Manufacturers Association, EMA.  EMA is the trade
17   association that represents the world's leading
18   manufacturers of internal combustion engines.
19   Included among the engines manufactured by EMA's
20   members are the small spark-ignition engines that
21   power the ground supported equipment covered by
22   the proposed regulation that is the subject of
0124
 1   today's hearing.  My comments today are limited to
 2   such non-handheld small spark-ignited engines
 3            EMA has been an active participant in the
 4   development of EPA's proposed rule.  We appreciate
 5   the tremendous effort that EPA staff has taken in
 6   crafting the pending rulemaking, a rulemaking that
 7   will result in technology forcing but, we believe,
 8   achievable emission limits.  The net result is an
 9   NPRM, that when implemented, will provide dramatic
10   emission reductions reflecting the maximum
11   achievable technology for ground supported small
12   spark-ignited engines.  For example, substantial
13   early benefits will be achieved by the requirement
14   to implement fuel line permeation controls in 2008
15   with zero (and in some cases negative) lead time.
16            In considering the NPRM, it should be
17   noted that ground supported small spark ignited
18   engines are commodity items, meaning cost is
19   critical to customer acceptance in the market
20   place.  If cost is too high, consumers will not
21   buy new product to replace older, higher emitting
22   equipment.  If new equipment is not purchased, the
0125
 1   desired air quality improvements will not be
 2   achieved as expected.  In addition, manufacturers
 3   will not be able to recoup their investment in
 4   new technology.
 5            As such, it is imperative that EPA
 6   continue to work with the affected stakeholders,
 7   to finalize and implement the proposed regulatory
 8   structure to ensure that the desired air quality
 9   improvements are achieved in a cost-effective and
10   efficient manner.  While the NPRM clearly is
11   headed in the right direction, there are modest
12   modifications that would help ensure that the
13   maximum level of emissions reductions from ground
14   supported small spark-ignition engines and
15   equipment are achieved in the most cost-effective
16   manner possible.
17            Accordingly, EMA supports the overall
18   framework of the NPRM, and we will continue to
19   work with EPA to help finalize a rule that will
20   provide a flexible regulatory structure and, thus,
21   provide substantial and cost-effective benefits to
22   the environment.
0126
 1            EMA does have a number of specific issues
 2   that EPA should address in their final rule:
 3            Number one, harmonization.  Harmonization
 4   between California and Federal regulatory
 5   requirements is of the utmost importance, and we
 6   expect EPA to work with CARB to achieve
 7   harmonization in order to avoid unnecessary costs
 8   and reduce administrative burden.  For example,
 9   the proposed evaporative emissions test methods
10   and standards are not as fully aligned as they
11   should be.  Lack of harmonization creates needless
12   expense and duplication of effort.
13            Two, flexibility.  The proposed rule
14   provides important opportunities for both engine
15   manufacturers and equipment manufacturers to
16   implement the proposed new stringent emission
17   requirements with potentially cost saving
18   flexibility programs.  However, those programs
19   must be modified to assure that the manufacturers
20   can take advantage of these flexibilities to most
21   cost effectively implement the new standards.
22            For example, EPA must ensure that the
0127
 1   final evaporative control requirements are
 2   flexible, yet able to be effectively implemented
 3   without undue cost, complexity and administrative
 4   burden.  While the proposed evaporative control
 5   requirements include a wide variety of options in
 6   an effort to provide flexibility to the diverse
 7   industry affected by the rule, there are
 8   significant burdens associated with such options
 9   that add unnecessary complexity and cost.
10   Similarly, EPA also must modify the proposed rule
11   to ensure that there are no disincentives to the
12   early introduction of new, clean technology
13   engines.  We will provide other examples where
14   impediments to flexibility can and should be
15   eliminated in our written comments.
16            Three, labelling.  The proposed labelling
17   requirements are overly burdensome and impractical
18   in many respects.  EPA must ensure that the
19   labelling requirements imposed by the rule are
20   reasonable and achievable.
21            Four, enforcement.  EPA must ensure that
22   the rule is equally enforced on all industry
0128
 1   participants, regardless of their country of
 2   origin.  In order for market participants to
 3   remain competitive in the industry, it is crucial
 4   that EPA has the ability to enforce the rule on
 5   products imported into the United States and on
 6   companies without significant assets in the United
 7   States.  While we support the bonding provisions
 8   established in the proposed rule, EPA must take
 9   additional steps to ensure that there is a level
10   playing field, and that non-compliant product does
11   not illegally enter the marketplace.
12            EMA will elaborate on these and other
13   specific issues in its written comments.
14            In conclusion, we support EPA's overall
15   framework for the NPRM, and we appreciate EPA's
16   diligent and collaborative efforts in this
17   rulemaking process.  EMA and its members remain
18   committed to continuing that collaborative process
19   as this proposal becomes final and, ultimately, is
20   implemented, thereby significantly improving air
21   quality across the nation.  Thank you.
22            MR. WOOD-THOMAS:  Thank you.
0129
 1   Mr. Leggett.
 2            MR. LEGGETT:  Good morning.  My name is
 3   Nickolaus Leggett.  And I represent myself.  I am
 4   an independent inventor holding several US
 5   patents.  And independent inventor is an inventor
 6   who produce an invention and patents it on his own
 7   resources without being an employee of a
 8   corporation.
 9            Independent inventors are important to
10   the economy of the United States.  Last year, the
11   year 2006, there were over 15,000 patents granted
12   to American independent inventors.  This is
13   approximately 15 percent of the total number of
14   patents granted to Americans.
15            I'm proposing to the EPA that several
16   specific changes be made in these rules in order
17   to accommodate independent inventors and to
18   encourage the inventive process.
19            My first suggestion is that any engine
20   built by the inventor himself in his own shop be
21   automatically exempt from these regulations.
22   These engines are essentially prototypes which are
0130
 1   constructed for the process of invention.
 2            Invention is a process where you have to
 3   tamper, you have to change, you have to modify.
 4   It's different than a production engine where the
 5   user isn't able to tamper with it.  So the
 6   inventor who is making something with his own
 7   mill, his own lathe and all, should be allowed to
 8   proceed without having to go through enormous
 9   amounts of paperwork or any processes like that.
10            Second, it's the personal use exemption
11   in these regulations which are for people who
12   build their own boats on their own resources as
13   distinguished from boats that are purchased.  In
14   the regulation, you propose a person can build his
15   own boat once in a ten year period.  And this boat
16   would be exempt from the regulation.  I suggest a
17   change in that structure.
18            Essentially if somebody is building a
19   boat under 20 feet in length, they should be able
20   to build three boats within the ten year period.
21   The reason I'm proposing that is that if you build
22   a small vehicle, it doesn't take you ten years to
0131
 1   do it.  I built a small hummer craft, for example,
 2   several years ago, it certainly didn't keep me
 3   going ten years.
 4            If the person is building two boats
 5   under -- people should be allowed to build two
 6   boats under 35 feet within the ten year period or
 7   one larger boat in the ten year period.  The
 8   notion being that you want to encourage people to
 9   build boats and design boats.
10            I have two patents on hummer craft
11   steering propulsion systems.  At some point you
12   have to build things and play with things to
13   develop them and to produce further inventions
14   that are patentable.
15            So I'm saying you keep the idea of having
16   a ceiling on the number of hand built boats but
17   you make it flexible so that somebody who is
18   building little run abouts, doesn't have to wait
19   ten years to build the next one, where someone
20   building a big yacht, once in ten years is
21   probably enough.
22            My third point is on the reduce scale
0132
 1   hobby engines.  This is a good idea.  These small
 2   engines are good for marina and for developing and
 3   modifying, both engine technology and vehicle
 4   technology.
 5            My specific interest is in hummer craft
 6   vehicles and hummer craft vehicles can be nicely
 7   modeled at model scale.  We want to keep a
 8   freedom to try new designs.  The model is a good
 9   one.  I do want to make it clear, this should also
10   apply to engines that are over 50 ccs, the rules
11   are talking about engines under 50 ccs, but
12   there's some in the model area which are over 50
13   ccs, spark-ignited engines and those should be
14   included as exempt from the regulations if they
15   are in vehicles that are too small to carry a
16   person.
17            My fourth suggestion is there are a fair
18   number of hobbyists and builders and machinist who
19   restore historic engines to service and sometimes
20   install them in historic re-created boats.  And
21   these engines should be exempt as well as the
22   replica engine kits that are provided where people
0133
 1   machine the engines in their home shops and then
 2   have an engine they can use.  The actual number of
 3   engines and boats built under these exemptions
 4   that I proposed is fairly small.
 5            We do need to have a zone for invention
 6   where people can create new things without
 7   worrying about a bureaucracy coming down on them
 8   where they don't have to fill out lots of
 9   paperwork.
10            I'm basically a political conservative
11   and I want to have some rung to enter the economy
12   as an individual.  I want to have some room to
13   create things.  And we have to provide that within
14   the structured regulation even though we do want
15   to protect the atmosphere and reduce emissions.
16            We want a free zone for inventors and
17   building engines.  I have several friends in this
18   area who are already equipped with a shop, are
19   ready to go in this kind of construction.  They
20   are highly skilled in the production of metal
21   objects and they should have the opportunity to
22   move ahead.
0134
 1            In my case, I'm interested in hummer
 2   craft and providing hummer craft with other
 3   technologies such as the custer channel wing for
 4   making a vertical take off aircraft.  In that case
 5   we have to do a lot of experimentation with this
 6   new type of vehicle.
 7            I'd like to thank you all for having the
 8   opportunity to speak to the EPA and to the
 9   audience.  And I do hope that we can push ahead
10   where there's a zone allowed for the free exercise
11   of invention, which is useful for the economy and
12   the United States.  Thank you very much.
13            MR. WOOD-THOMAS:  Thank you.  A few
14   questions.  The first for Mr. Leggett.
15   Mr. Leggett, you mentioned early in your remarks
16   exemption for inventing prototypes.  And is it
17   safe to presume that the exemption you're arguing
18   for would be for an individual or single engine,
19   single prototype?
20            MR. LEGGETT:  Yes, that's correct.  I'm
21   not trying to get around the law and have 100
22   prototypes, or something.  That's not the notion.
0135
 1   The notion is you want to have a prototype or two
 2   that the person can work with, you learn from that
 3   and you usually scrap that and move on to another
 4   prototype.
 5            I'm not talking about any mass numbers.
 6   In fact, if you want to put a ceiling on numbers,
 7   that's fine, to protect the regulations but we do
 8   need some area for people to produce prototypes.
 9            MR. WOOD-THOMAS:  Thank you.  Also I have
10   a question for Mr. Gault but before proceeding to
11   that, let me turn to Glenn who also has a question
12   for Mr. Leggett.
13            MR. PASSAVANT:  Mr. Leggett, very simply
14   what would be your definition in terms of age of
15   antique for purposes of our consideration of your
16   request?
17            MR. LEGGETT:  In terms of the restorative
18   service?
19            MR. PASSAVANT:  Yes, sir.
20            MR. LEGGETT:  I notice somewhere in the
21   regulations you were talking 20 years, something
22   of that order for ancient engines, I think was the
0136
 1   term.  I would say something on that order for
 2   ones that were actually restored from antique
 3   condition to working condition.  I do want some
 4   protection, though, for the replica antique
 5   engine, the hit or miss engine from history and
 6   the people are essentially recreating.  Most of
 7   the replicas are model scale of the 50 cc but not
 8   all.
 9            MR. WOOD-THOMAS:  Thank you, Mr. Leggett.
10   Mr. Gault, in your testimony, you emphasized the
11   need to ensure that noncompliant products do not
12   enter the market.  While that comment was made
13   relative to future tense, do you have reason to
14   believe or basis to believe that there's currently
15   non-compliant products entering the US market?
16            MR. GAULT:  I believe we have some
17   indications of products in the marketplace that
18   don't comply with the current regulations and
19   we've been in contact with the agencies wherever
20   we find out about those, through individual
21   members or through the organization.
22            MR. WOOD-THOMAS:  Can you offer any
0137
 1   perspective on how extensive you think that
 2   practice is presently?
 3            MR. GAULT:  I don't have a scale, sir.
 4            MR. WOOD-THOMAS:  Okay.  Thank you.  With
 5   respect to our proceedings, one, we have a few
 6   venues immediately available to us for lunch.  And
 7   let me share my thinking about timing, et cetera.
 8   I'm going to ask Rita Parsons who has been
 9   handling our sign up to give everyone a
10   description of what our choices are for lunch here
11   but in terms of the timing, presumably people
12   would not like too extending a lunch period so we
13   can end as early as possible.  On the other hand,
14   we have a number of people here and if we are
15   going to break for lunch, we need time to actually
16   have lunch.  So I would suggest that once we do
17   break here we would return at 1:30 to proceed and
18   we would pick up with panel five.
19            Two things, for anyone who is not signed
20   up, we would please encourage you to sign up at
21   the desk so we have a complete record of everyone
22   who has attended today.
0138
 1            And secondly, I'd like to invite Rita to
 2   describe what our choices are no lunch in the
 3   immediate vicinity.
 4            (Lunch break taken)
 5            MR. WOOD-THOMAS:  If everyone will get
 6   seated, we'll get started.  As mentioned, before
 7   we broke for lunch, our intent here this afternoon
 8   is to proceed through the remainder of the panels.
 9            Once again I'll remind you if there's
10   anyone who wants to offer comment or testimony,
11   please inform people at the desk outside and we'll
12   add you to the agenda.
13            In the interest of moving forward we'll
14   begin now with our fifth panel and individuals on
15   the fifth panel are John McKnight from National
16   Marine Manufacturers Association, Mark Riechers,
17   Mercury Marine and Paul Ray, from Ilmor.  John.
18            MR. MCKNIGHT:  Good morning, my name is
19   John McKnight.  I am the Director of Environmental
20   and Safety Compliance for the National Marine
21   Manufacturers Association, NMMA.
22            With 1,600 members, NMMA is the nation's
0139
 1   leading recreational marine industry association
 2   representing boat builders, engine manufacturers
 3   and marine accessory manufacturers collectively
 4   producing more than 80 percent of all recreational
 5   products made in the United States.
 6            Before I summarize NMMA's position on a
 7   number of key aspects of this rule, I would first
 8   like to sincerely thank the EPA for its efforts
 9   over the years in taking the time to learn about
10   the recreational marine manufacturing industry.
11   Both Mike Samulski and Glenn Passavant have spent
12   a significant amount of time meeting with the
13   engine, boat and component manufacturers, both in
14   Ann Arbor and at various NMMA boat and trade
15   shows.  In addition, it is equally important to
16   note the significant investment that our members
17   have made over the past ten years to develop low
18   emission marine engines.  These positive
19   accomplishments often get lost in the rhetoric
20   used to support the need for a proposed rule.
21   Maybe not all industries can say this, but NMMA
22   engine manufacturers have a very positive message
0140
 1   to report and that is:  Working with EPA, our
 2   industry has been able to create a whole new
 3   generation of low emission, better performing fuel
 4   efficient outboard personal watercraft engines
 5   that would have been unheard of when Mike Samulski
 6   and I started working with this industry over a
 7   decade ago.
 8            As a result of this effort, NMMA supports
 9   the basic technical elements in this proposal and
10   we are poised to continue our art to preserve a
11   clean environment for America's recreational
12   boater.  That said, it is still important that
13   certain timing and implementation details are
14   worked out and NMMA is confident that we can reach
15   agreement with EPA on any lingering issues.  These
16   issues are as follows:
17            NMMA can support EPA's proposed catalyst
18   based emission standards for sterndrive and
19   inboard engines, provided that our engine
20   manufacturers have sufficient time to comply and
21   our small business engine manufacturers continued
22   to be defined as less than 50 employees.  In
0141
 1   addition, EPA needs to implement a feasible
 2   non-catalyst based emission standard for the high
 3   performance engines.
 4            NMMA can support the proposed emission
 5   standards for outboard and personal watercraft
 6   engines provided that our engine manufacturers
 7   have sufficient time to comply and these emission
 8   standards are harmonized exactly with the CARB
 9   2008 emission standards.
10            NMMA can support the carbon monoxide
11   emission standards in the proposed rule.
12            For evaporative emissions, NMMA requests
13   that EPA work with the California Air Resource
14   Board to harmonize its standards.  Having two
15   separate evaporative standards for recreation
16   vessels would be extremely burdensome, when you
17   consider the increased cost of complying with two
18   standards, especially for the small boat builder.
19   EPA should be aware that CARB is moving quickly to
20   finalize a rule.
21            NMMA can support the requirement for low
22   permeation fuel hose, but recognizes that this
0142
 1   will be a boat builder requirement, not an engine
 2   manufacturer requirement.  Thus sufficient time
 3   must be allowed to insure that all small business
 4   boat builders, most of who are not NMMA members
 5   have sufficient time to understand the
 6   requirements and transition their stock to the new
 7   hose.
 8            NMMA can support the requirement for low
 9   permeation plastic fuel tanks with the reservation
10   that any new technology can meet marine durability
11   standards, and we support the lead time provided
12   by EPA in the proposal.
13            NMMA supports the need for diurnal
14   emission requirements for boat fuel systems, but
15   we have serious reservations regarding the safety
16   of the current technology when applied to
17   recreational marine use.  A clogged canister or
18   fuel vapor separator would create a pressurized
19   fuel system, which USCG accident records have
20   clearly documented as a hazardous situation.
21            This summarizes NMMA's position on the
22   majority technology requirements.  As you can
0143
 1   tell, NMMA supports the engine and evaporative
 2   emission technical requirements in this proposal
 3   with very few reservations.  The certification,
 4   administrative requirements and timing in this
 5   proposal will be commented on by the manufacturers
 6   and covered in detail in NMMA's written comments
 7   and subsequent discussions with EPA.  Several of
 8   the NMMA members testifying here today will
 9   address the remaining details that need to be
10   worked out with the agency in order to ensure that
11   EPA finalizes a standard for marine engines that
12   is both effective and workable for the industry.
13            In conclusion, NMMA has a proposal for
14   EPA:  Recreational boat builders have historically
15   been a collection of small businesses.  Over the
16   last ten years, the industry has seen
17   consolidation of boat builders under three large
18   business companies, Brunswick Corporation, Tracker
19   Marine and Genmar Holding Company.  This trend
20   continues with the recent consolidation of a
21   number of boat builders under the corporate name
22   of Nautic Global.  Even with this consolidation,
0144
 1   there are still many small independent boat
 2   builders.  NMMA recognizes that these boat
 3   builders will never understand these requirements
 4   or even fully recognize that they have additional
 5   requirements without a significant outreach
 6   effort.  NMMA is working with the American Boat
 7   and Yacht Council to include the EPA requirements
 8   in the widely followed and accepted industry
 9   standards.  NMMA will also provide education and
10   training on these new requirements at shows such
11   as IBEX.  That said, this is just the tip of the
12   iceberg when you consider the number of boat
13   builders in the US.  North Carolina alone has well
14   over 100 boat builders, about ten are NMMA
15   members.
16            Between the final rule and the
17   implementation date, NMMA recommends that EPA work
18   with the Small Business Administration and the
19   United States Coast Guard to ensure the funding is
20   available to support a series of workshops and
21   outreach efforts in key boat manufacturing states.
22   NMMA will provide more detail on this critical
0145
 1   need in our written comments.  Thank you.
 2            MR. WOOD-THOMAS:  Thank you.
 3   Mr. Riechers.
 4            MR. RIECHERS:  Good morning, my name is
 5   Mark Riechers.  And I am the regulatory
 6   development manager for Mercury Marine.  Mercury
 7   Marine is the largest marine engine company in the
 8   world, the only SI marine engine company that
 9   builds both outboards and inboards/sterndrives and
10   very notably the last surviving American outboard
11   company.
12            We have been discussing this rulemaking
13   with EPA for over three years.  In that time, we
14   have had many hours of discussion with EPA,
15   presented a considerable amount of data, and have
16   reached agreements on many issues.  I believe we
17   are probably 95 percent in agreement with EPA, and
18   most of the concerns we have are addressed by
19   options presented in the preamble.  As my time is
20   limited here, I would like to go through just the
21   major issues.  The details and the more minor
22   issues will be in our detailed written comments to
0146
 1   be delivered to EPA no later than August 3.  Most
 2   of the issues I will discuss are timing.  There
 3   are only a couple of technical issues.
 4            I want to be very clear on this:  Mercury
 5   Marine supports cleaner engines and reduced impact
 6   on the environment.  If EPA incorporates the
 7   mostly minor modifications that I am going to
 8   outline today, Mercury Marine fully supports this
 9   rule.
10            Let's start with outboard engines.  EPA
11   has proposed HC and NOx standards that are very
12   close to CARB's.  Unfortunately, they are not
13   identical.  As we had expected full alignment with
14   CARB on the standard, we have been working
15   diligently to align our product line with the CARB
16   standard.  I was advised that the reason for this
17   change was simplification.  Having to do separate
18   calculations for CARB and EPA is not
19   simplification, it is double the work for no real
20   gain.  Therefore, we strongly urge EPA to go back
21   to the California method of determining the
22   standards.
0147
 1            If EPA will simply return to the
 2   standards calculation to the CARB approach, then
 3   Mercury Marine will support one of the options in
 4   the preamble, which is meeting the standard in
 5   2009 for most of our product line, with a small
 6   phase in allowance and 100 percent compliance in
 7   2010, as long as the rule is finalized in
 8   sufficient time and carry over 2008 certifications
 9   is allowed for the new rule.  This small
10   flexibility would allow us to reconcile our
11   complete product line to the new standards.
12            Regarding the proposed CO standard of 300
13   g, with a 450 g cap, we fully support it as
14   written, as long as EPA makes one change on ABT.
15   The provision where an engine that uses credits on
16   one pollutant and it cannot generate credits on
17   another severely hampers averaging in DI 2 stroke
18   engines, as these engines are very low on CO
19   emissions, but some of them are above the proposed
20   standard on HC and NOx and would use credits.
21            For the NTE zone, we and others have
22   shown that no set of multipliers work for all of
0148
 1   the different engine technologies and
 2   manufacturers.  However, a proposed method from
 3   BRP, where randomly selected NTE zone points would
 4   be supplied by EPA prior to testing has our
 5   support as long as we work together to define the
 6   zones and agree on the multiplier.  Also since the
 7   rule will not be final until sometime in 2008, we
 8   can't certify all of our engines to the NTE zone
 9   for 2009.  There are simply too many engines and
10   not enough time.  What we propose is that engines
11   meet the requirement whatever they have to be
12   retested for new certifications, but all must meet
13   it by 2012.  To install, set up and test just for
14   meeting the NTE zone requirement would be very
15   costly with no significant emissions benefit.
16            For fuel hose permeation, as we have
17   previously discussed, it is impossible for us to
18   change out all of the hundreds of under cowl hoses
19   to low permeation fuel line by 2009.  However, we
20   agree with the option in the preamble, where we
21   would pull forward into 2008, the requirement for
22   a low permeation main fuel line from the engine to
0149
 1   the tank in exchange for a 30-60-90 phase in for
 2   under cowl hoses between 2010 and 2012.  There is
 3   some concern about notifying the smaller boat
 4   builders in time for the 2008 pull ahead, so there
 5   may need to be some small flexibility for small
 6   businesses.  The one other issue on outboard
 7   permeation is the primer bulb.  While we believe
 8   that it is possible to develop a low permeation
 9   primer bulb, we are very early in our development
10   and 2009 would require a home run on our
11   development efforts.  We would propose that 2010
12   is a realistic target for low permeation primer
13   bulb, which we only use on outboard engines below
14   40 horse power.
15            Now, let me switch gears and go to
16   inboard and sterndrive.  Mercury Marine is the
17   largest SI inboard and sterndrive company.  This
18   is a very different product, it is a marinized
19   version of an automotive engine, mostly supplied
20   by General Motors.  General Motors has recently
21   announced that it is making significant changes in
22   its product line of base marine engines in the
0150
 1   2009/2010 time frame.  This has turned our
 2   business upside down right now.  We had to go back
 3   to the California Air Resource Board, as an
 4   industry, and request relief on developing
 5   catalysts systems for some engines that have a
 6   very short product life.  That relief has been
 7   provided.  We also will be on a very tight time
 8   line to marinize and develop catalyst systems for
 9   the new models.  In addition, we are meeting the
10   CARB 2008 rule by not selling some models in
11   California.
12            The proposed standards of 5 grams per
13   kilowatt hour HC and NOx, with a 16 gram, cap and
14   a 75 gram CO standard with 150 gram cap, we are in
15   agreement on, with the credit generation issue
16   discussed in outboard also supplied to sterndrive
17   and inboard.  What we have a huge problem with is
18   implementation in 2009.  If we had to meet the
19   standard in 2009, as soon as the rule is signed,
20   we would have to apply for relief under the
21   hardship provision.  That is not the way we want
22   to start out with a new rule.  Between the issues
0151
 1   with GM we have discussed and the fact that we are
 2   not selling some models in California, which we
 3   can't reconcile in our product line until 2010, we
 4   need one of the options that is in the preamble.
 5   That option is compliance with the standard for
 6   the engine families that are not changing in 2010
 7   and an extension to 2011 for the engine families
 8   being replaced by GM, keeping in mind that Mercury
 9   Marine will not get even prototype level hardware
10   for GM's new engines until late this year or next
11   year.  The development cycle for converting these
12   auto base engines to marine engines is 30-36
13   months.  This also allows for the possibility of
14   GM missing the launch date of the new models and
15   the industry not having to come back to EPA for
16   hardship relief.
17            We will also gain some field experience
18   with the catalyst engines in the California
19   market, as catalyst feasibility testing at SwRI
20   was terminated, with industry approval, without
21   ever demonstrating catalyst durability in a
22   salt water environment.  Since that independent
0152
 1   testing, funded by EPA and CARB, was never
 2   completed, it should not be considered
 3   unreasonable to allow for the California market to
 4   begin that testing grounds for two years.
 5            For the NTE zone, we again believe that
 6   the approach we discussed in the outboard section
 7   is appropriate.
 8            EPA has proposed a requirement of low
 9   permeation main and engine mounted fuel lines for
10   2009.  We are fine with that.
11            One other issue of great importance, that
12   of production line testing.  We have had prior
13   discussions with EPA regarding an option that PLT
14   would be waived on sterndrive and inboard if we
15   had an onboard diagnostic system that met CARB's
16   requirements.  That option was not included in the
17   rule or preamble and we are requesting it be
18   included as an option, as it will reduce costs
19   without any risk of higher emissions.
20            The final area I would like to cover is
21   sterndrive and inboard engines over 500 horse
22   power.  This is a very small, and uniquely
0153
 1   American industry comprising Mercury Racing and
 2   several small businesses, at least one of which is
 3   represented here today.  Mercury Racing in fact
 4   operates similarly to a small business, as it is a
 5   stand alone operation of 180 people hand building
 6   engines.
 7            First, let me explain this part of the
 8   industry.  These are very highly tuned and very
 9   highly priced engines used mostly in offshore type
10   boats.  The entire market is 2,500 engines per
11   year and some percentage of that are sold outside
12   of the United States.  This is an entirely
13   American industry, creating many, good paying
14   jobs, as the products we export out of the country
15   helps our balance of trade.
16            EPA and CARB have acknowledged that the
17   contribution to emissions from this sector is very
18   small and that catalysts are not feasible on these
19   products.  EPA has proposed several options on how
20   to regulate the niche market and the most
21   equitable is to set a capping standard.  Mercury
22   Marine will provide data and recommendations in
0154
 1   its written comments as to its proposed two tier
 2   standard.
 3            There are evaporative emissions
 4   requirements that involve all of the engine and
 5   boat categories.  CARB has recently started to
 6   propose evaporative emissions standards that are
 7   different in timing and approach from what EPA is
 8   proposing.  We absolutely need a harmonized
 9   evaporative emissions standard nationwide.  This
10   industry is too small to build California boats
11   and 49 state boats.  Therefore, we ask that EPA 
12   work with CARB to develop one harmonized
13   evaporative emissions rule, similar in scope to
14   what EPA has proposed.
15            In summary, as you can see, our areas of
16   concern are few, they are mostly timing and a few
17   technical details.  Mercury Marine's position is
18   that, with these few elements changed, we
19   will fully support this rule.  Our customers are
20   recreational boaters and they have a strong
21   interest in protecting the environment.  We
22   appreciate EPA's efforts and look forward to
0155
 1   finalizing this rule and moving forward with
 2   cleaner and better products.  Thank you for this
 3   opportunity to share our views.
 4            MR. WOOD-THOMAS:  Thank you.  Mr. Ray.
 5            MR. RAY:  Good afternoon.  My name is
 6   Paul Ray.  And I'm the President of Ilmor Marine
 7   Engines.  Ilmor is a manufacturer of high
 8   performance sterndrive inboard engine only.  So
 9   all the comments I'll make this afternoon are
10   directed purely toward the high performance engine
11   sector.
12            Since introducing our first engines in
13   2003, our sales have increased to roughly 200
14   engines a year, which as Mark identified, that
15   number actually represents about eight to ten
16   percent of the entire high performance sector.
17            Ilmor is generally in support of the
18   proposed high marine engine rules.  We take
19   exception only to some details which I'll cover in
20   a moment.
21            We do completely support the need for
22   specific caps on hydrocarbons plus NOx as well as
0156
 1   CO emissions.  And we are supportive of an
 2   industry feasible non-catalyst based standard.
 3   Our written responses to the EPA's request for
 4   comment will be supported by engine test data at
 5   an independent test laboratory and market survey
 6   information collected by an independent source.
 7            We support a high performance emission
 8   standard because we feel it will create a level
 9   playing field with all engine manufacturers called
10   upon to engineer their products to meet the
11   mandates.  That's the smallest companies and the
12   largest companies falling under one level playing
13   field.
14            Carburetors with all their negative
15   characteristics will be technically obsoleted.
16   Our market data indicates that as much as 43
17   percent of all high performance engines in the
18   United States consist of carbareted fuel
19   systems.
20            So ultimately the new caps, the new rules
21   will actually improve the quality of engines in
22   the high performance sector which for us will
0157
 1   improve the customer satisfaction.
 2            That said, we are a very, very small
 3   industry.  Another primary concern with the
 4   proposed rules is the commercial burden that it
 5   will place upon the industry.  Total engine sales,
 6   again as Mark identified is somewhere between
 7   2,000 and 2,500 units.  And there are between 15
 8   and 20 legitimate manufacturers throughout the
 9   USA.  Many of these manufacturers produce less
10   than 50 engines a year and employ about ten
11   people to do so.  This is really a tiny industry.
12            This small market sector just simply
13   doesn't possess the revenue or resources to be a
14   technology leader.  Capital investments required
15   to apply catalyst based technology are beyond the
16   commercial capabilities of a marine company the
17   size of Ilmor.  And if it's certain that it's true
18   for us, it will also be true for the majority of
19   the other manufacturers within the sector.
20            As a small manufacturer, we are seeking
21   the removal of any averaging banking and trading
22   of credit schemes from the high performance sector
0158
 1   rule.  Firstly, most high performance engine
 2   manufactures including Ilmor, do not have products
 3   below 373 kilowatts with which to average.
 4   Therefore, such a rule would unfairly benefit
 5   those very few manufacturers that do have trading
 6   possibility.  And secondly, we simply cannot count
 7   on credits being available on the open market from
 8   other manufacturers.
 9            We also support the idea of a single
10   fixed standard for high performance engine
11   emissions for all manufacturers regardless of
12   their size.
13            We propose that a high performance sector
14   can be advantageously divided into two distinct
15   performance ranges.  Our proposal is 373 kilowatts
16   to 485 kilowatts, which again according to our
17   market research will cover about 60 percent of the
18   total market.  And then a second tier for all
19   engines above 485 kilowatts.
20            Our contention is that a lower emission
21   standard than that currently proposed for
22   non-catalyzed engines for the whole sector could
0159
 1   be implemented within the lower power tier.  And
 2   we will produce information supporting this.
 3            Additionally we also support a standard
 4   for the high performance sector for the high
 5   performance standard that will include an
 6   alternative to the standard E-4 test duty cycle.
 7            Please let me be clear, we're not seeking
 8   to change the E-4 test cycle.  We're proposing an
 9   optional alternate test cycle for the high
10   performance sector.  Such a system is not without
11   precedent within EPA rules.  Our argument for this
12   proposal is the style of use of the high
13   performance boat.  High performance engines are
14   designed to optimize performance in the mid range
15   and high engine speeds.
16            This standard marine E-4 test cycle weights
17   40 percent at no load idle.  And our data suggests
18   that high performance engines only spend about
19   eight percent of their life at a no load idle and
20   only 20 percent at an in gear loaded idle.
21            In summary, Ilmor is strongly supportive
22   of high standards for the high performance sector.
0160
 1   The harmonized standard that's effective in all 50
 2   states; an even standard that applies to all
 3   manufacturers regardless of size; a standard that
 4   will cause significant emission reductions in the
 5   high performance sector; and a standard that would
 6   directly improve the quality of the products
 7   offered.
 8            What we can't support is a standard that
 9   places our small business in jeopardy, a standard
10   that requires greater expenditure than affordable
11   for such a small business sector.  A standard so
12   restricted that we're required to invent
13   technologies that are not currently available or a
14   standard that unfairly benefits one or two larger
15   manufacturers with emissions credits and training.
16            I thank you for your time.  I'd also like
17   to thank both the National Marine Manufacturers
18   Association for their continued support and to the
19   EPA for giving us an opportunity to voice our
20   position on this important issue.
21            MR. WOOD-THOMAS:  A few questions.
22            MR. PASSAVANT:  I have one for each of
0161
 1   you, if I may.  John McKnight, I was a little
 2   concerned about your one statement in your
 3   testimony about expressing grave concern about the
 4   safety considerations with the use of canisters
 5   for the boats.  And it was the way you expressed
 6   it.  It wasn't the fact that you raised the safety
 7   issue.  You said it in an onerous way.  I was
 8   interested if you could explain that for me more,
 9   please.
10            MR. MCKNIGHT:  From my discussions with
11   ABYC and some of the manufacturers, the one
12   concern we have that I think that needs to be
13   further investigated -- I mean, NMMA ran tests on
14   canisters for a summer and they worked fine.  We
15   saw -- actually there was talk of today does a
16   passive system work.  We have data to show that
17   there's a significant reduction.
18            I think the one concern we have and we're
19   working with ABYC on it is on the installation
20   standards of the what if, what happens if the
21   fuel vapor separator clogs, what happens if the
22   canister clogs?  We're starting to mess with the
0162
 1   fuel system which starts to fall under the
 2   direction of the US Coast Guard.
 3            I think we have to be careful when we
 4   look at how soon we can do this.  As I talked
 5   earlier there's 3,000 boat builders out there that
 6   can potentially have to put these systems in.  We
 7   have to make sure they are put in a safe manner.
 8   I raised the issue that we have to make sure when
 9   this gets done, that it's safe.
10            MR. PASSAVANT:  As I understand this,
11   you're not really suggesting that it can't be done
12   safely, it's just the implementation issues
13   associated with it?
14            MR. MCKNIGHT:  Exactly, I wouldn't argue
15   the fact that it works.  We've seen it work.  We
16   did the testing, we paid for it.  I want to make
17   sure if there are problems along the way that we
18   make sure they are resolved before this becomes a
19   requirement for the boat builders.
20            MR. PASSAVANT:  Mark, I have one follow
21   up on yours.  And that, I think I put the two
22   pieces together on the 2010 for the standard,
0163
 1   linking that back to the Southwest program.  And
 2   I'd like to ask you to consider in your thinking
 3   about a different or perhaps a bigger picture on
 4   this and that being in this context.  That for
 5   various reasons, it's been 17 years since EPA has
 6   had the authority or the requirement to regulate
 7   this sector and we haven't done it.  We now have
 8   an active proposal out there for the first time.
 9   I'm concerned about any kind of a program that
10   would give the appearance that we're letting it
11   slip even one more year.
12            What do you think about -- and we can
13   talk about this more about it after, but your
14   written comments about options to get some
15   catalysts in the field in 2009.
16            MR. RIECHERS:  Actually we're discussing
17   that internally right now.  The biggest problem
18   that we have is that we don't control the product
19   mix out in the field, the boat builder controls
20   the product mix.  So having, for instance, a
21   structured phase in is something we can't control.
22   But there are certain market segments we're
0164
 1   looking at in trying to figure out.
 2            And one of the things that we do like
 3   that's in the proposed rule is that there's a
 4   provision in there for banking early credits which
 5   is an incentive program to try to get catalyst out
 6   there earlier.  And we're seriously looking at
 7   that and seeing what we can do.
 8            I don't have a definite answer for you
 9   today.  But that is on our radar scope as to how
10   we can do that.
11            MR. PASSAVANT:  And my one final question
12   for Mr. Ray.  You were kind enough to come and see
13   us three months ago.
14            MR. RAY:  Yeah, I think so.
15            MR. PASSAVANT:  And we talked very
16   constructively about the disconnect that we have
17   now between what we have on the table for the
18   Federal program and what you are facing in
19   California.  And the reason I'm bringing that up
20   isn't because it isn't necessary to these
21   proceedings but you asked to us to harmonize with
22   California.  And that would essentially be what we
0165
 1   don't want to have happen because that would mean
 2   there would be a five gram standard.  And while
 3   some companies can average their way around that,
 4   most would not be able to do that.  And it would
 5   be a non-starter for us to be able to implement
 6   it.
 7            We're in a situation here in trying to
 8   find a way forward that works not only for the
 9   Federal side but for the companies and with
10   California.
11            And so whenever you raise concerns about
12   the averaging program, I can understand you saying
13   that in a sense of saying, well, if you limit it
14   to an averaging program, you're out of luck
15   because you don't have anybody to average with but
16   there are potentially other segments within the
17   marine world to gather credits from if we were to
18   go that direction.
19            I'm putting it out there as to say as you
20   think about how to craft your written comments, a
21   couple points you made are if you're really
22   constrained, if you're really definitive in the
0166
 1   way you presented them almost put us in a box of
 2   not having an option to meet all those
 3   requirements, both to even if we end up with a
 4   non-catalyst based standard you're not going to be
 5   harmonized with California and so on and so forth.
 6            If you can think more about that.  There
 7   may be other discussions.  I want to lay that out
 8   there, this is a tough one.  We haven't found a
 9   way -- been driven to a technology solution.  I
10   wanted to lay that out to you.
11            MR. RAY:  Thank you.
12            MR. WOOD-THOMAS:  Thank you.  We'll move
13   to our next panel.  Next Paul Dierksen, Volvo
14   Penta of the Americas, Chuck Thursman,
15   Pleasurecraft Marine Engines and Crusader Marine
16   Engines and Eddie Allbright, Marine Power.
17            MR. DIERKSEN:  Good afternoon.  My name
18   is Paul Dierksen, Senior Vice President
19   Marketing/Corporate Planning, representing Volvo
20   Penta of the Americas with offices in Chesapeake,
21   Virginia and manufacturing in Lexington,
22   Tennessee.  Volvo Penta of the Americas employ
0167
 1   over 300 people and is a leading manufacturer of
 2   gasoline based sterndrive and inboard engines for
 3   recreational marine markets.  We are a division of
 4   AB Volvo, employing 95,000 worldwide.
 5            Before discussing Volvo Penta's position
 6   on a few key elements of the rule, we would first
 7   like to express our support of the basic tenets of
 8   the proposal.  With safety and care for the
 9   environment as two of our corporation's core
10   values, we are motivated and prepared to assist in
11   the preservation of a clean environment for
12   recreational boaters and US citizens.
13            Volvo Penta of the Americas believes that
14   with some timing adjustments and a few modified
15   execution points, we will be poised to deliver on
16   the precepts of this proposal.  These outstanding
17   issues are as follows:
18            Number one, Volvo Penta of the Americas
19   supports full compliance effective January 1,
20   2010, not 2009, for its 3.0, 5.0, 5.7 and 8.1
21   liter engines.  Because General Motors is
22   discontinuing its 4.3 liter and 8.1 liter, we
0168
 1   request the implementation date for new 4.1 and
 2   6.0 liter engines be January 1, 2011.  This
 3   additional year ensures necessary time for testing
 4   and ramp up of the production facility to meet 49
 5   state volumes.  In addition, it ensures uniformity
 6   of products in the field.  In other words, all
 7   dealers will sell the same products at the same
 8   time.
 9            Volvo Penta of the Americas opposes
10   production line testing as redundant and
11   unnecessary.  All sterndrive and inboard engines
12   will be equipped with catalytic converters and
13   feedback loop controls with on board diagnostics.
14   The feedback loop control measures each of the
15   emission characteristics proposed in the
16   production line testing protocol at initial start
17   up of every engine off our assembly line and again
18   by our dealer at customer delivery, thereby
19   ensuring emissions compliance.  Volvo Penta will
20   also maintain electronic record keeping.
21   Production line testing is therefore economically
22   burdensome with little or no benefit beyond
0169
 1   redundancy.
 2            Volvo Penta of the Americas opposes the
 3   need to broadcast engine torque.  This is a new
 4   requirement not previously discussed and of
 5   dubious value to emission control.
 6            Volvo Penta disagrees with the proposal
 7   that manufacturers not be allowed to schedule
 8   critical emission related maintenance during
 9   useful life.  Testing to date shows that there is
10   not a commercially available O2 sensor that will
11   survive the useful life of the emissions system.
12   Until a technical solution for the longer term O2
13   sensor is available, the consumer will be required
14   to replace the O2 sensor during the scheduled
15   maintenance.
16            Volvo Penta of the Americas opposes any
17   alternative field test procedures.  Like
18   production line testing, this is a costly
19   redundancy when engines are equipped with onboard
20   diagnostics that continue to monitor and record
21   emissions and compliance data whenever the engine
22   is operating.
0170
 1            Volvo Penta disagrees with the creation
 2   of marine engine families as outlined in the NPRM.
 3   Such a protocol creates too many engine families
 4   and designations and results in overly burdensome
 5   record keeping.  As an alternative Volvo Penta
 6   proposes families be designated by engine
 7   displacement.
 8            In conclusion, Volvo Penta of the
 9   Americas fully supports the proposal's goals and
10   with the suggested modifications we will be poised
11   to deliver products in compliance with the rule.
12            Thank you for your time and consideration
13   of these issues raised.
14            MR. WOOD-THOMAS:  Thank you.  Mr.
15   Thurman.
16            MR. THURMAN:  Thank you.  Good afternoon.
17   My name is Chuck Thurman.  I am president of
18   Pleasurecraft Marine Engine Company.  We are a
19   privately held company located in Little Mountain,
20   South Carolina.  Our total manufacturing focus is
21   gasoline inboard marine engines for the water
22   sports, sport fishing and cruiser market.  We
0171
 1   currently employ 85 people and are a small
 2   business as defined by the Small Business
 3   Administration.
 4            There are five points that I would like
 5   to address regarding the proposed rule but before
 6   I do that, I would like to say our company is
 7   fully supportive of emission reductions and is
 8   working diligently to solve the many complex
 9   technical and implementation issues associated
10   with manufacturing a catalyst controlled engine.
11   Further, I would like to thank John McKnight of
12   the NMMA for his efforts over the years to bring
13   the many organizations' view points and approaches
14   together for the good of the industry.
15   Additionally, I would like to thank my fellow NMMA
16   members for their efforts and forethoughts.
17   Lastly, I would like to thank the EPA for their
18   insights in crafting and document that, with minor
19   changes, will be of great benefit to our industry,
20   the boating community and our environment.
21            The areas Pleasurecraft feels need
22   further refinement are as follows.
0172
 1            Number one, small business size.  Section
 2   1045.801 defines a small volume engine manufacture
 3   as one with annual worldwide production of no more
 4   than 5,000 sterndrive inboard engines in any
 5   calender year.
 6            Pleasurecraft recommends instead,
 7   adoption of the universal size standards as used
 8   by the Small Business Administration under the
 9   North American industry classification system.
10   There are several classifications that could be
11   used to define small businesses, all based on the
12   number of employees, rather than units produced.
13            Number two, engine families.  Section
14   1045.230 outlines the criteria for defining engine
15   families.  There are two areas that need
16   reconsideration.  These areas are:
17            Line item 2, the cooling system (section
18   1045.230, paragraph (b)(2)), and line item 5, the
19   number, location, volume, and approximate bore
20   diameter of the cylinders (section 1045.230,
21   paragraph (b)(5)).
22            Regarding line item 2, segregating engine
0173
 1   families by their cooling system accomplishes
 2   nothing more than doubling the number of engine
 3   families.  Emissions will not vary for
 4   thermostatically controlled engines regardless of
 5   whether the engine is raw or fresh water-cooled,
 6   therefore, the cooling system should not be a
 7   factor in determining engine families.
 8            Regarding line item 5, there are
 9   circumstances where similar engines, of different
10   displacements should be included in a common
11   engine family.  An example would be the General
12   Motors 5.0 and 5.7 liter engines.  These engines
13   vary only in displacement and share common
14   induction systems, number and arrangement of
15   cylinders, cylinder heads and external
16   marinization components including exhaust equipped
17   with catalyst.  Historically General Motors, who
18   designed these engines has classified them as one
19   family.  If the larger displacement 5.7 liter will
20   meet emissions standards, it is safe to say that
21   the 5.0 liter will do so as well.  Classifying
22   these engines as one family, as they should be,
0174
 1   will save small businesses, such as ours, tens of
 2   thousands of dollars in unnecessary certification
 3   cost.
 4            Three, defects and recalls.  Section
 5   1068.501 is a lengthy section detailing an
 6   elaborate method of reporting and correcting
 7   emission related defects.  This section appears
 8   more applicable to the automobile industry than
 9   the marine industry.  Pleasurecraft recognizes and
10   agrees with the need for proper and timely problem
11   resolution as well as the associated documentation
12   required.  However, this method of defect and
13   recall reporting represents an extreme burden for
14   small businesses.  Therefore, we advocate for
15   harmonization with methods outlined in the
16   California Air Resource Board procedures for
17   defect and recall protocols.
18            Number four, NTE zone, section 1045.515
19   outlines the procedures for establishing emission
20   standards for the not to exceed zone.  NMMA
21   members have provided alternative test methods
22   that address the open loop phase of the marine
0175
 1   duty cycle as well as common test procedures.  We
 2   are fully supportive of the NTE concept but
 3   request that the EPA consider the alternative
 4   approaches recommended by the NMMA.
 5            Number five, production line engine test.
 6   Section 1045.301 outlines the method for testing
 7   production line engines.  Pleasurecraft would like
 8   to see the elimination of this requirement since
 9   the onboard diagnostic system will detect any
10   malfunctions or abnormalities and will prevent the
11   engine from being introduced into commerce until
12   proper corrections are implemented.  Additionally
13   this process will harmonize with CARB procedures.
14            Further comment on these items will be
15   provided in our written comments.
16            In closing, I would like to thank the EPA
17   for the opportunity to present our concerns.  As a
18   small business participant in this rule making
19   process we support the enactment of the proposed
20   Federal sterndrive inboard exhaust standards with
21   the above noted exceptions.  Pleasurecraft Marine
22   Engine Company looks forward to continuing our
0176
 1   work with the agency to develop a rule that is of
 2   great benefit to the boating public and the
 3   environment.  Thank you.
 4            MR. WOOD-THOMAS:  Mr. Allbright.
 5            MR. ALLBRIGHT:  Good afternoon, my name
 6   is Eddie Allbright.  I'm President of Marine Power
 7   Holding.  We manufacture a variety of jet pump
 8   drives.  Our customers include both weight board,
 9   ski boat and inboard jet propulsion boat motors.
10   We build a small number of engines over 500 horse
11   power.  Marine Power is located in Ponchatoula,
12   Louisiana, in a small community 50 miles north of
13   New Orleans.
14            Marine Power originally built engines for
15   the Gulf coast shrimping and fishing industry as
16   early as the 1960s.  Today we employ about 35
17   people.  I'm here today to express my concerns on
18   three different issues in the proposed ruling,
19   first there appears to be some ambiguity which has
20   been discussed about the definition of a small
21   business.  I'm asking that you retain the
22   customary definition of a small business being one
0177
 1   less than 500 employees.
 2            Second the original PWC outboard rule in
 3   California.  Since the original outboard rule in
 4   California there's been a progression of the size
 5   and power of the original PWC jet boat engines.
 6   These engines are now used in boats with
 7   sterndrive and inboard and weight board and ski
 8   boats.  Marine Power competes in both these markets.
 9   We ask that such engines shall be regulated the
10   same as the inboard sterndrive engines that Marine
11   Power offers.
12            Thirdly, although Marine Power only built
13   a small volume of 500-plus horse power engines at
14   present we would ask that they be regulated in
15   such a way that we could continue to participate
16   in that market.
17            I'm going to jump off my written text
18   here just for a second to make a few comments on
19   some things that was said this morning.  We
20   recognize that we have to -- we are introducing
21   product in California January of '08 that will be
22   fully compliant with the regulations proposed here
0178
 1   today.
 2            California although a large portion of
 3   our market, we anticipate that being a test base.
 4   And we appreciate extra time that we would have so
 5   that we will learn from the California market.  A
 6   corollary to that is that we did abandon the
 7   saltwater testing before it was complete and there
 8   was no I would say completion or success in that
 9   testing.
10            It was mentioned this morning that there
11   are engines in the field today, inboard engines in
12   the field today with catalysts on them and that is
13   correct.  I can tell you a Louisiana or a Cajun
14   can bolt a catalyst on an engine.  The more
15   significant difficulty there is developing the OBD
16   management systems to monitor the catalyst
17   emissions and as of -- I don't think the software
18   has even been fully released.  It will conduct
19   that management until the next couple months.
20            Another comment was made this morning
21   about cost.  Because our customers are going to be
22   bear a significant increase in cost and we support
0179
 1   this technology but we are also conscious we're in
 2   a down time in our industry.  And we're hoping to
 3   keep the boating market available to the breadth
 4   of the marketplace and not turn into Europe where
 5   only the affluent can boat.
 6            I appreciate the opportunity to make
 7   these comments today.  Marine Power has invested
 8   well over a half million dollars to prepare for
 9   this rule.  I realize that's a small amount of
10   money to most people.  It's sizeable to us.
11            Thank you for your consideration.  I'll
12   be happy to answer anything.
13            MR. PASSAVANT:  Mr. Thurman or Eddie,
14   either one of you, I'm not clear on one thing.
15   Could you help us understand the significance the
16   one defining the small business one way versus
17   theory, the significance to either or both of your
18   businesses would be helpful.
19            MR. THURMAN:  From our perspective it is
20   of concern because our business has found itself
21   falling above and below that number that is in the
22   rule.  So one year it could be applicable and not
0180
 1   the following year again.  As it was mentioned
 2   earlier today, I think down the line that can
 3   create a lot of confusion especially for our
 4   company.
 5            MR. PASSAVANT:  Is that similar.
 6            MR. ALLBRIGHT:  Yes, that would be the
 7   same for me.
 8            MR. PASSAVANT:  We proposed, we sought
 9   comment on a definition of units of sale and the
10   traditional definition is on the number of
11   employees.
12            MR. ALLBRIGHT:  Yes, sir, we would
13   possibly fall from one category to another in
14   regard to unit sale.  In our 32 years of history,
15   we will always remain a small business in the SBA
16   sense.
17            MR. PASSAVANT:  The reason that's
18   important is because of the implementation
19   schedule for the rule 2011?
20            MR. ALLBRIGHT:  Yes, sir, that would be
21   one of the reasons.
22            MR. PASSAVANT:  Thank you.
0181
 1            MR. WOOD-THOMAS:  Thank you, gentlemen.
 2   With respect to our next panel, one modification
 3   again to accommodate logistics, Mr. Ostrosky from
 4   Yamaha Motor Corporation has spoken early.
 5   Filling that slot, Dave Marlow will move up from
 6   the Brunswick Boat Group.  Mr. Fernando Garcia
 7   from Bombardier Recreational Products and Mr.
 8   Masakazu Kikuchi from Tohatsu.  Dave.
 9            MR. MARLOW:  Thank you very much.  Good
10   afternoon.  And I am the Director of Product
11   integrity for the Brunswick Boating Group.  I have
12   been employed in the marine industry for over 20
13   years.  Brunswick Boating Group is headquartered
14   in Knoxville, Tennessee and has the distinction of
15   being the largest maker of pleasure boats in the
16   world.
17            You may have heard of some of our brands.
18   We make Sea Ray, Bayliner, Maximum, Hatteras,
19   Meridian, Sealine, Baja, Albermarle, Boston
20   Whaler, Cabo, Laguna, Palmetto, Sea Boss, Sea Pro,
21   Trophy, Crestliner, Harris Kayot, Lowe, Lund,
22   Princecraft and Triton.  We also own Land 'N' Sea
0182
 1   Diversify Marine Products and Kellogg Marine
 2   Supply Parts and Accessory Distribution and
 3   Attwood Marine Parts and Accessory.
 4            Like the others before me, I want to
 5   reiterate that we too support the EPA's efforts
 6   for improving the environment through cleaner
 7   products and by reducing the impact of those
 8   products on the environment.  Given that, we would
 9   like to make clear some of the concerns that we
10   have in the proposed implementation of this rule.
11            As a boat manufacturer, we have watched
12   the various areas of the CARB rule unfold during
13   the last few years.  Of course they include hose
14   permeation emissions in addition to the exhaust
15   emission standards required for engines.  We
16   participated as an industry member and have
17   assisted in finding solutions.
18            As you are aware, boat manufacturers were
19   subject to a negotiated pull ahead for low
20   permeation hoses in exchange for additional lead
21   time required for our engine partners to meet the
22   exhaust requirements in California.  While we were
0183
 1   able to make the change for sterndrive and
 2   inboards boats, it did not address outboard
 3   engines at that time.  A similar method is being
 4   considered for this proposed rule.  I think it
 5   should be considered that the pull ahead for low
 6   permeation hoses in exchange for additional lead
 7   time for under the cowl outboard hoses may need to
 8   be moved to January of 2009.  The marine industry
 9   will need that additional lead time for educating
10   boat builders on the requirements to use these
11   hoses.  Moreover, it would be our understanding
12   that this would also require certification so it
13   should be considered by EPA what type of outreach
14   will be provided to the boat builders.
15            Another concern for the marine industry
16   is the low permeation rate primer bulb.  While
17   Mr. Riechers testified that his company is working
18   on a solution, it should be noted that to our
19   knowledge, a commercially viable option does not
20   exist at this time.  As you imagine, a large
21   amount of our smaller aluminum and pontoon
22   products would be affected by this and there may
0184
 1   be a need for your flexibility to help accommodate
 2   the upcoming requirement.
 3            We have been exploring carbon canisters
 4   as a way to meet the diurnal emission requirements
 5   that were outlined in the CARB rule.  We have
 6   embarked upon a test program that installed the
 7   devices in line with the vent system on some of
 8   our engineering boats and some concerns have
 9   arisen from that.  One of the concerns, and a
10   significant safety risk in boating is fuel spills
11   and subsequent fire or explosions in boats.  It is
12   the reason our industry employees the use of
13   electric fuel shut off valves and anti-siphon
14   devices in the fuel system.  Additionally, we are
15   always very careful to install ignition protected
16   equipment in the bilges of our craft so as not to
17   provide the potential for spark should a leak
18   occur.
19            This has led to some drawbacks in the
20   fuel delivery systems of boats, especially in the
21   hotter months of summer where fuel can atomize and
22   cause vapor lock in engines.  Considerations have
0185
 1   been made to pressurize fuel systems in order to
 2   solve this problem but have always been met with
 3   greater concerns over a failure and the
 4   pressurized system pumping a boat's bilge with
 5   fuel.  The testing of the canisters has led us to
 6   question what the possible risk of a clogged
 7   canister or a fuel vapor separator would be to
 8   that end.  We ask that this be researched further
 9   to determine the level of risk that the canisters
10   may or may not pose to the safety of the marine
11   fuel system.  We would also support a phase in
12   approach so that ABYC, our industry standards
13   association, could work on a standard for the
14   canister and look at the possible pressurization
15   issue.
16            The preamble of this rule also brings up
17   the issues of fuel spill and spit back.  While the
18   suggestions from EPA to have ABYC form a group to
19   look at standardization regarding the prevention
20   of spit back is important, it should be noted that
21   a number of factors need to be considered with
22   regard to a requirement to eliminate spit back or
0186
 1   spillage during the refueling, not just automatic
 2   shut off.  While ABYC may be able to address the
 3   technical issues related to refueling,
 4   standardization of fuel filler nozzles and fuel
 5   flow rates at marinas must be addressed before the
 6   boat builders can design for compliance.
 7            There are also fuel tank permeation
 8   solutions to consider.  As you can imagine, the
 9   advent of cross linked polyethylene tanks offered
10   boat builders with an alternative material to
11   ensure tank longevity.  The current permeation
12   requirements still have not yielded a commercially
13   viable solution other than a whole scale return to
14   aluminum.  While many larger tanks are still made
15   of aluminum, the increase in bio fuels will bring
16   about larger water content in the fuel tanks based
17   on the known properties of ethanol.  Increased
18   water brings corrosion concerns that we must deal
19   with.  We would recommend that we consider a
20   standard for tanks similar to that of fuel hoses
21   in order to explore these issues.
22            Recently, I sat through an industry
0187
 1   gathering regarding the new rule.  One thing that
 2   struck me as a real issue to think through was the
 3   certification of the boat.  As I understand it,
 4   the boat builder would begin certification when
 5   the components start to phase in as requirements.
 6   As well, there is a labelling requirement for
 7   hoses and tanks.  Boat builders already have an
 8   overwhelming number of certification and labelling
 9   requirements for the boat itself.  We need to
10   ensure that we work towards a universal solution
11   regarding the matter to avoid confusion.  The NMMA
12   has a current type accepted program for many safety
13   related components that are installed in boats.  A
14   similar approach to the certification requirement
15   would make it a much easier transition for boat
16   manufacturers to follow.
17            In closing, I would like to thank you for
18   the time to speak on this topic.  I implore the
19   EPA to look for common approach and alignment with
20   the current CARB rule as we have all spent a
21   considerable amount of time and effort in meeting
22   those guidelines.  Brunswick Boat Group will work
0188
 1   to find avenues that will allow the boat building
 2   industry to fully support the final rule.  Our
 3   consumers will appreciate the cleaner and better
 4   products that we bring to the marketplace.  Given
 5   that, we look forward to working with the EPA as
 6   we move forward.
 7            MR. WOOD-THOMAS:  Thank you.  I know
 8   you're facing pressure on a flight and I'll ask
 9   you a question now in case you have to leave.  You
10   mentioned consideration of certification of the
11   boat.  Can you be more specific, Dave, about
12   aspects of the certification and the proposal that
13   you're concerned about?  Do you have any specific
14   suggestions about improvement of the certification
15   process?
16            MR. MARLOW:  We would just like to see
17   alignment with what we see as a pretty good type
18   accepted program as NMMA.  It's going to be
19   difficult, as John pointed out, there's a large
20   mass of manufacturers that don't participate in
21   NMMA's program.  The certification issue is going
22   to be a hard one for them to deal with.  If we
0189
 1   can align with NMMA's program it seems to make
 2   sense to participate in that program, it may make
 3   the transition a little easier for everyone, sir.
 4            MR. WOOD-THOMAS:  Thank you.  Mr. Garcia.
 5            MR. GARCIA:  Good afternoon, my name is
 6   Fernando Garcia.  I am the Director of Government
 7   and Public Affairs for Bombardier Recreational
 8   Products, Inc.  Thank you for this opportunity to
 9   offer comments pertaining to the marine proposal.
10            Bombardier Recreational Products is a
11   manufacturer of marine engines and vessels,
12   non-road recreational vehicles and most recently
13   an innovative 3-wheel on-highway motorcycle.  The
14   Bombardier Recreational Products line of Evinrude
15   and Johnson Outboard Marine Engines and Seadoo
16   sport boats are manufactured in the United States.
17   Bombardier Recreational Products is committed to
18   obtaining a clean recreational environment for
19   America's boaters.  This commitment is best
20   reflected by our Evinrude ETEC outboard engine
21   technology which was awarded the 2004 EPA clean
22   excellence award.
0190
 1            Bombardier Recreational Products supports
 2   the industry positions as communicated by the NMMA
 3   pertaining to the basic technical elements in this
 4   proposal specifically, number one Bombardier
 5   Recreational Products can support the proposed
 6   emission standards for outboard and personal
 7   watercraft engines if sufficient lead time is
 8   provided and these emission standards are
 9   harmonized exactly with the California ARB
10   emission standards.
11            Number two, Bombardier Recreational
12   Products can support the requirement for low
13   permeation fuel hoses as well as the requirement
14   for low permeation cross link and high density
15   polyethylene plastic fuel tanks with the proposed
16   lead time for implementation.
17            And number three Bombardier Recreational
18   Products can support the diurnal emission
19   requirements from boat fuel systems only if the 1
20   psig design compliance option is provided.
21            However, Bombardier Recreational Products
22   cannot support EPA's proposed catalyst based
0191
 1   emission standards for sterndrive and inboard
 2   engines as it presently applies to water jet sport
 3   boats.  This product category has been regulated
 4   under the standards applied to outboard and
 5   personal watercraft engines on the basis that
 6   water jet sport boats utilize the same engine
 7   technology as personal watercraft engines.  It is
 8   understood that the EPA now desires to regulate
 9   the boat category under the traditional sterndrive
10   and inboard category which has exclusively
11   utilized automotive based engines.  These
12   sterndrive and inboard engine manufacturers have
13   effectively been developing a catalyst solution in
14   preparing for the CARB regulation since
15   approximately 2004.  It is therefore very
16   inappropriate to subject the water jet sport boats
17   to the same proposed lead time given the
18   difference this basic engine technology and prior
19   catalyst development time.
20            Furthermore, there are numerous patents
21   held by a competitive water jet sport boat
22   manufacturer which represent clear and significant
0192
 1   design constraints to Bombardier Recreational
 2   Products in order to avoid patent infringement.
 3   There are effectively 30 related patents which
 4   have applicability to water jet sport boats, 13 of
 5   which have specific catalyst application
 6   constraints.  These constraints include catalyst
 7   positioning, layout, cooling and sensor placement
 8   issues.  The fundamental nature of these
 9   challenges results in the need for greater
10   development lead time.
11            Bombardier Recreational Products'
12   development and application lead time for an
13   established engine technology is approximately
14   three years.  The patent issues I have briefly
15   explained represent complex design challenges and
16   it is therefore not possible at this point to
17   project the amount of additional development time
18   required to meet the proposed catalyst application
19   to water jet sport boats.
20            However, the lead time challenge can be
21   justly addressed by providing water jet sport boat
22   manufacturers which utilize an outboard/personal
0193
 1   watercraft engine technology the following
 2   allowances:
 3            Number one, an implementation lead time
 4   of model year 2011.
 5            And number two, CO emission averaging
 6   between water jet sport boats and outboard
 7   personal watercraft subcategories.
 8            The CO emission averaging allowance will
 9   ensure that EPA achieves the desired CO reduction
10   targets as well as maintaining a catalyst based
11   requirement.
12            Again, thank you for the opportunity to
13   speak before you.  Bombardier Recreational
14   Products looks forward to working with the EPA to
15   finalize this regulation.
16            MR. WOOD-THOMAS:  Thank you.
17   Mr. Kikuchi.
18            MR. KIKUCHI:  Good morning, ladies and
19   gentlemen.  My name is Masayuki Kikuchi.  And I
20   work for Tohatsu Corporation in Japan.  Tohatsu is
21   one of the oldest Japanese manufacturers of
22   outboard engines.  And we produce outboards for
0194
 1   several different brand names in the US
 2   marketplace.  I am in charge of coordinating our
 3   company's efforts to meet EPA related regulations
 4   and other country's regulations.  I first want to
 5   thank you for giving us the chance to explain our
 6   company's standpoint and appeal our requests to
 7   the EPA.
 8            First of all, it is quite a tough job for
 9   a small manufacturer like Tohatsu who has total
10   employees of less than 500 people to redevelop and
11   set calibration fuel, ignition timing, et cetera,
12   and also comply with the evaporative requirements.
13   And naturally these changes will also require a
14   new batch of deterioration testing at 350 hours
15   for all models.  Although we understand that these
16   requirements are necessary, it is very time
17   consuming and expensive process for a small
18   company to meet.
19            While we are strongly committed to
20   supporting the EPA in developing national
21   standards to keep the environment of the world
22   clean, what we would like to appeal to the EPA is:
0195
 1            Number one, contents of the new
 2   regulations should be the same as the current CARB
 3   standards to avoid having to comply with two
 4   different sets of standards and testing methods.
 5   We would like to see one national standard rather
 6   than a national standard and then also other
 7   standards set by different local areas.
 8            Number two, Tohatsu would like to request
 9   that the time frame be extended as much as
10   possible to give small manufacturers like us
11   realistic chance to comply with the new
12   regulations.  Unlike many of our competitors, that
13   have other divisions in cars and motorcycles,
14   mainly Tohatsu produces only outboards.  Because
15   of this, we do not have the same resources to be
16   able to comply with the new regulations as quickly
17   as other companies.  We hope that you will keep
18   this in mind when developing the time frame needed
19   for the new regulations.
20            Thank you for listening.  And we ask that
21   you please consider the small manufacturers like
22   Tohatsu as you develop your new regulations so
0196
 1   that we are able to comply with your requirements.
 2   Tohatsu is committed to helping all countries to
 3   keep an environment clean and we hope that EPA
 4   will help us accomplish this goal.  Thank you.
 5          MR. WOOD-THOMAS:  Thank you.  No questions
 6   from us at this juncture.  We'll proceed to our
 7   next panel.
 8            MR. WOOD-THOMAS:  Our next panel is John
 9   Adey, American Boat and Yacht Council, Jim Hardin,
10   Grady White Boats and Steve Burkholder,
11   Envirofill.  Mr. Adey.
12            MR. ADEY:  Good afternoon, my name is
13   John Adey.  I am the technical Director for the
14   American Boat and Yacht Council.  ABYC is a 4,800
15   member organization that promulgates widely
16   accepted voluntary safety standards for the marine
17   industry.  ABYC is responsible for 18 project
18   technical committees that are staffed with over
19   425 volunteers from all sectors of the marine
20   community who create and review our standards.
21   Internationally, ABYC also serves as the technical
22   advisor group to the ISO technical committee
0197
 1   dealing with recreational boat standards for the
 2   European Union and is leading the charge for
 3   global marine standardization.
 4            ABYC's partnership with the National
 5   Marine Manufacturers Association and their third
 6   party boat and yacht certification program has
 7   seen a large rise in compliance with the ABYC
 8   standards over the last five years.  380 builders
 9   are involved in the NMMA certification program.
10   With the consolidation of the marine industry,
11   these manufacturers produce approximately 90
12   percent of the product on the water today.  This
13   translates to 90 percent compliance with ABYC
14   standards for boats being sold in the US today.
15   The bottom line is that changes to ABYC standards
16   result in changes to the industry.
17            ABYC has been working with NMMA and our
18   project technical committees to provide technical
19   standard based documentation for early support of
20   several aspects of this rule.  The committees
21   represented the best minds in the industry, all
22   working together for unparalleled safety and
0198
 1   quality of the boating experience.
 2            Responding to early information from Mike
 3   Samulski, ABYC will be publishing an early
 4   revision (July 2007, effective July 2008) to our
 5   gasoline fuel system standard H-24 that includes a
 6   provision of low permeation fuel hose;
 7   concurrently ABYC has worked with the society of
 8   automotive engineers to produce a now published
 9   standard on qualification testing for the low
10   permeation hose to meet the rule.
11            Evaporative emissions are also in our
12   area of expertise.  The well established
13   technology of automotive carbon canisters is
14   presenting many challenges when adapted to the
15   marine environment.  ABYC established a carbon
16   canister working group in 2006 including Delphi,
17   Mead-Westvaco, the US Coast Guard Office of
18   Boating Safety and industry fuel component experts
19   to discuss, and eventually overcome, the safety
20   issues surrounding this solution.  The absence of
21   a universally accepted automotive standard on the
22   construction and installation of a canister has
0199
 1   caused ABYC to begin writing a marine focused
 2   standard to address all aspects of a canister on
 3   board a boat.  Size, construction, shock,
 4   vibration, installation, and service environments
 5   are all concerns that are being addressed.  The
 6   nature of the carbon and canister itself causes
 7   some unique issues that could result in
 8   pressurization of marine fuel tank which violates
 9   the 33 CFR regulations that apply to recreational
10   boats for fuel systems.  Again, a challenge to
11   overcome that will take time to effectively solve.
12            The rule also has a discussion on spit
13   back.  The unique aspects of a boat have offered
14   many challenges when refueling.  The infinite
15   combination of vehicles and trailers cause vessel
16   attitudes to vary widely during fueling.  Unlike
17   automobiles, boat attitudes also vary widely
18   during normal operation, this results in a much
19   higher likelihood of liquid gasoline finding its
20   way into the vent system than encountered in an
21   automobile.  Fill and vent openings must be
22   located such that any fuel spilled, either from
0200
 1   the filler or the vent, will not spill into the
 2   boat thereby creating a grave fire and explosion
 3   hazard.  This results in the current configuration
 4   in recreational boats that causes spills and
 5   overflows to be drained over board, minimizing the
 6   fire and explosion risk albeit contributing to
 7   water and atmospheric pollution.  All of these
 8   factors combine to make it impossible to simply
 9   adopt the automotive model for the marine market.
10   ABYC is encouraging open and frank discussions
11   among project technical committees and also ISO
12   working groups to develop a solution to spills
13   caused by refueling or venting that will continue
14   this summer.  This will be a long road and will
15   likely result in substantive redesign of the fuel
16   system, as we know it, in order to prevent and/or
17   contain spills while still complying with
18   established Federal regulations.
19            An additional concern ABYC shares with
20   NMMA is the education of the non-NMMA builders.
21   The USCG has a database with over 4,000 registered
22   boat builders.  ABYC is geared towards all
0201
 1   builders with the ultimate goal of safer product
 2   on the water.  With our 15 year track record of
 3   educating and certifying personnel to our
 4   standards, we believe ABYC will be a crucial asset
 5   for educating the approximately 3600 builders that
 6   remain uncertified by the NMMA.  With the proper
 7   funding, ABYC can educate boat builders on a much
 8   broader scale, to the upcoming EPA requirements as
 9   well as ways to make a boat safer.
10            In conclusion, the membership of ABYC
11   appreciates the opportunity to be involved with
12   the EPA on this and future rule makings.  We pride
13   ourselves on the technical skills and quality of
14   our members as well as our ability to quickly and
15   accurately respond to technical challenges
16   presented to the boating industry.  Our industry
17   has a history of addressing issues through
18   voluntary standardization; it has been effective
19   for over 50 years, more boats are on the water and
20   accident trends have steadily fallen.  Let's
21   continue the time honored practice of
22   standardization before regulation.  Thank you.
0202
 1            MR. WOOD-THOMAS:  Thank you.  Mr. Hardin.
 2            MR. HARDIN:  Thank you for the
 3   opportunity to comment and continued willingness
 4   to listen to our concerns regarding our proposed
 5   regulations.
 6            My name is Jim Hardin and I represent
 7   Grady White Boats in Greenville, North Carolina.
 8   Grady White is very supportive and an industry
 9   leader for advocating for clean waters in a marine
10   environment.  We are a privately owned small
11   business, and employ about 400 people.  I will
12   also submit more detailed comments in writing.
13            First the low perm fuel line, the
14   implementation date of 01-01-08 seems too soon.  I
15   think one year from the date of the final rule or
16   even '09 is more reasonable.  That's not a problem
17   necessarily for us as a company.  I think
18   everybody has repeatedly told you have thousands
19   of boat builders out there, it's going to be
20   difficult to effectively communicate those needs
21   in such a short period.  The marine low perm
22   primer bulbs also don't exist to my knowledge at
0203
 1   this time.
 2            A couple comments about that, the
 3   certification of the bulb was part of an assembly
 4   will be difficult for most small boat builders,
 5   just like we do, most people are purchasing the
 6   bulb from one supplier while the hose comes from a
 7   different supplier.  That creates a lot of testing
 8   and certification for the small business.
 9            I fully believe bulbs can be designed
10   that will not hold fuel, not be used or low perm
11   and it will operate effectively but at this time
12   we just need time to make sure we can get them
13   designed, tested and certified that they will meet
14   both standards.
15            2009, the time frame on this, seems like
16   when you think about it, it's less than a year
17   from now, when you consider it, by the time the
18   rule is finally published, we're in production now
19   in '08.  So at this time next year we will be
20   producing '09 product.
21            Couple comments about low perm tanks.
22   Again, the implementation date seems aggressive
0204
 1   when you consider there are no low perm tanks 
 2   currently in use.
 3            Again to my knowledge we've heard about a
 4   couple companies that have products they say meet
 5   the requirements, permeation requirements.
 6   However to my knowledge, neither one of these two
 7   companies that have spoken today have production
 8   level in field, ship abroad that boat builders are
 9   using.  That again is to my knowledge.  I'm not
10   aware if anybody using their product in the field
11   currently.
12            We just need time to prove that the
13   technologies they are proposing are in fact usable
14   for us.  The warranty on the barrier layer, we
15   have to have time to make sure or longer the impact
16   resistance has been described by other.  That is a
17   concern.  The other concern is most of these dual
18   layer tanks are going to require drop box
19   technologies from what I understand.  Sometimes
20   it's not uncommon for us -- we make 22 models, we
21   only make a couple 1,000 boats or less a year.
22   It's not uncommon for us to make 100 or 150 per
0205
 1   year.  It would be conceivable we would have a
 2   tool used to make gas tanks that two or three
 3   years we would phase out.  It would be very
 4   expensive to create the drop box technology for
 5   that.
 6            With the refuel and spit back and
 7   spillage, we would prefer ABYC continue, they
 8   already started on this.  The angles, we don't
 9   sell trailers, we don't sell packages, we sell
10   boats.  Trailers, they buy from a local trailer
11   manufacturer or regional trailer manufacturer.
12   The attitudes that the boats sit on a trailer,
13   while being refueled, on the water could be
14   radically different.  I think there is a need to
15   look at standard requirements for marinas for
16   automatic fuel shut offs at the refueling stations
17   as well as a range of a fuel range.  We don't want
18   to slow the fuel rate down so low you have to
19   spend an hour and a half to two hours filling up a
20   boat at marina, that would kill our business.  We
21   have many boats that have up to 400 gallons of
22   fuel capacity.
0206
 1            Carbon canisters and diurnal emissions,
 2   we are in favor of the phase-in canisters.  If you
 3   start with the 2010 model year, you have less than
 4   a year and a half to meet the proposal from the
 5   date of the final rule.  Seems like a short time
 6   for small businesses.  Again, I go back to we have
 7   22 different models.  There's a lot of engineering
 8   work has to be done and certification work.  We
 9   have to locate these systems and find out to have
10   accessible fittings and do that in a presentable
11   manner.  I think an additional year there would be
12   advantageous.  So you do 33 percent by 11 model
13   year.
14            My other concern expressed repeatedly
15   today is the potential for the liquid vapor
16   separator getting caught and salt crystallization.
17   We didn't see that in our test boats.  We only ran
18   the test boats for a short period of time.
19            Labelling requirements also it will be
20   good to make labelling easy on us.  You know, I
21   see a lot of small components with labelling
22   requirements, I don't know how accessible
0207
 1   labelling is going to be in the finished product.
 2            I'd also like to comment on the impact
 3   and challenges of the proposed rule creates of
 4   small businesses, the demands of reengineering,
 5   paperwork and record keeping and cost increases.
 6   Mostly the thing I see here is the rule, it's
 7   going to be part of our life and I think it's
 8   important to do the right thing but it's vital to
 9   try to do it to make it not paperwork nightmare.
10            I still if I understand it the proposal
11   still have to certify my boats yearly or
12   annually.  I'll be able to carry over the data,
13   pay the fee.  I have 22 different models, am I
14   going to certify those boats if they are all using
15   the standard same equipment to meet the
16   requirements do I have to certified all 22 models
17   individually, can I group them as a family?  Is
18   there some way to get a certified component and we
19   don't have to do paperwork every year?  Is it
20   possible to certify a boat for the life of a boat
21   as long as the components don't change?  Some
22   things that would make it easier on small
0208
 1   businesses and involved in the paperwork and
 2   annual recertification.  That's the main points
 3   I'd like to make today.  I appreciate your time
 4   and listening to my concerns.  Thank you.
 5            MR. WOOD-THOMAS:  Thank you.
 6   Mr. Burkholder.
 7            MR. BURKHOLDER:  Good afternoon.  My name
 8   is Steve Burkholder.  I represent Enviro-Fill.  We
 9   develop a technology to prevent overfill when
10   refueling boats.  I'd like to thank you for the
11   opportunity to participate in this rulemaking
12   process.  My comments will be directed at
13   requirements related to refueling of page 141 and
14   142 of the preamble.
15            First of all relying on current, future
16   boat industry standards, there are regulations and
17   standards in place that are followed in
18   construction of boats.  US Coast Guard regulations
19   are mandatory while ABYC are followed voluntarily.
20   According to NMMA a larger percentage boats are
21   sold that are not NMMA certified.  This system
22   seems to work, however, there's some shortcoming
0209
 1   in the standards.
 2            One of the standards that needs to be
 3   addressed to prevent spillage is H-24.5.1.1,
 4   defining how a tank is filled when meeting the
 5   requirements of 24.5.1.  ABYC requires room for
 6   expanding fuel and allows a manufacturer to set
 7   the capacity of a tank.  An accepted practice
 8   could be to change the rated capacity of the
 9   fuel tank.  They could put a 26 gallon tank in a
10   boat and have it at a 21 gallon capacity.  That
11   would meet the ABYC standard, however the operator
12   goes to the fuel dock and fills it up until the
13   fuel nozzle shuts off and you actually now have
14   a tank that actually contains 26 gallons with no
15   room for expansion.  When the fuel expands, it's
16   going to be forced through the carbon canister and
17   into the atmosphere.  It could be as much as five
18   percent or 1.3 gallons.
19            Another standard that doesn't meet the
20   requirements of this rule is H-24.17.1 the EPA
21   recommended procedure for refueling should be
22   adopted, with the addition of allowing five
0210
 1   percent room for expansion after automatic shut
 2   off to prevent fuel from being forced to the
 3   canister when it expands.
 4            There's currently no standards for
 5   defining a way of keeping the fuel from entering
 6   the carbon canister if that method is used.
 7   There's been a few comments about the check valves
 8   clogging, blocking.  I would just like to say we
 9   developed a technology that does not require a
10   check valve to prevent fuel from getting in the
11   carbon canister.  I'd like to go on the record
12   that the technology is available.
13            The next one was if ABYC cannot come up
14   with standards in time to meet the requirements of
15   this rule, I would assume the EPA would have to
16   adopt procedures and standards.  
17           The degree of fuel spill. There's no
18   studies that I'm aware of that accurately
19   quantify the problem.  However there's plenty
20   of article documenting how extensive the
21   fuel spill problem is.  US Foundation has a
22   website specifically addressing the fuel 
0211
 1   spill problem.
 2            In the folder you have there are a couple
 3   of letters from fuel dock operators stating the
 4   need for the change in design of both fueling
 5   system.  The one operator actually states that the
 6   majority of the boats that refueled at his marine
 7   spill through the vent.
 8            The potential to adopt ABYC standards to
 9   address fuel spillage and the need for the EPA to
10   adopt such a procedure standard, as I mentioned
11   earlier, the ABYC and NMMA have a system in place
12   to enforce current standards.  However the current
13   standards do not address the problem.  In fact
14   some of the standards specifically avoid the fuel
15   spill problem, 24.17.1 addresses refuel spit back
16   but does not require the tank to be filled or even
17   mention spilling out of the vent.
18            It's my understanding the standards are
19   reviewed every five years.  I don't know when they
20   were reviewed last, but this spilling issue has
21   been longer than five years.  This raises the
22   question whether ABYC could write standards that
0212
 1   would be adequate for the boat builders to meet
 2   the requirements of this proposed rule.  It's been
 3   established that the technology is available and
 4   should be considered when making any standards or
 5   rules.
 6            Procedures for measuring spit back,
 7   section 311 of the Clean Water Act states it's
 8   illegal to dump any petroleum product in the
 9   waters of this country.  With that in mind, it
10   would be not correct to allow any spill back or
11   spit back or spillage just because it would be
12   against the law.
13            Another thing to consider is spill out of
14   the deck fill vent.  When you're filling, and that
15   means the hose contains fuel which increases the
16   permeation rate.  As far as the refueling nozzle,
17   that is the one key thing to implement the
18   technology that I discussed.
19            I'd like to state that the nozzle
20   dimensions that are mentioned in the preamble
21   should be adopted and placed in those rules, that
22   rule.  The nozzle should be standardized.  And
0213
 1   that should be in effect at the same time that
 2   this rule is in effect.
 3            The problems that need to be solved are
 4   refueling spills, both back splash, spilling out
 5   the vent.  And it seems the carbon canister is the
 6   most common method that are talked about for
 7   controlling diurnal emission.  Fuel air separators
 8   have been used but as the boat US test that's in 
 9   your folder describes that they increase back splash 
10   through the deck fill.
11            All of these problems are based on one
12   thing, that is the fact that we're overfilling the
13   tanks.  The solution to the problem is that boats
14   should be filled or should be built that they can
15   be filled without overfilling the tank past its
16   intended capacity.  This can be done but requires
17   the use of available technologies and standard
18   fuel knowledge for marine application and finally
19   establish adequate test procedures that require
20   automatic shut off at fill rates between five and
21   20 gallon per minute with no spit back or spillage
22   and allowing five percent of the tank volume for
0214
 1   expansion after shut off.
 2            In conclusion, refueling spills can be
 3   eliminated in all new manufactured boats in the
 4   years to come.  This will only occur though with
 5   adequate standards and implementation of proper
 6   technologies.  I'd like to thank you for your
 7   time.
 8            MR. WOOD-THOMAS:  Thank you, gentlemen.
 9   No questions for this set of speakers.  Let me
10   ask one final time, is there anyone else that
11   would like to offer comment on testimony?
12            If not, let me remind everyone that the
13   comment period is open until August 3rd and
14   encourage anyone to submit written comments by
15   that deadline.
16            And with that, I thank you very much for
17   your patience and comments today and assure all of
18   you that the commentary and testimony today will
19   be carefully considered as we proceed forward with
20   developing the final rule.  Thank you.
21                (Whereupon, at 3:02 p.m., the
22                hearing was concluded.)
0215
 1                * * * * * *
 2            CERTIFICATE OF NOTARY PUBLIC
 3          I, Mary E. Warner, the officer before whom
 4   the foregoing hearing was taken, do hereby certify
 5   that the testimony appears in the foregoing
 6   hearing; that the testimony of said speakers was
 7   taken by me in stenotype and thereafter reduced to
 8   typewriting under my direction; that said hearing
 9   is a true record of the testimony given by said
10   speakers; that I am neither counsel for, related
11   to nor employed by any of the parties to the
12   action in which this hearing was taken; and,
13   further, that I am not a relative or employee of
14   any counsel or attorney employed by the parties
15   hereto, nor financially or otherwise interested in
16   the outcome of this action.
17   
18   
19                      MARY E. WARNER
20                 Notary Public in and for
21                 Commonwealth of Virginia
22   My commission expires:
0216
 1   December 30, 2010
 2   
 3   
 4   
