
[Federal Register Volume 74, Number 133 (Tuesday, July 14, 2009)]
[Proposed Rules]
[Pages 33950-33953]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E9-16642]


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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[EPA-R09-OAR-2009-0024; FRL-8930-4]


Revisions to the California State Implementation Plan, San 
Joaquin Valley Unified Air Pollution Control District

AGENCY: Environmental Protection Agency (EPA).

ACTION: Proposed rule.

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SUMMARY: EPA is proposing a limited approval and limited disapproval of 
revisions to the San Joaquin Valley Unified Air Pollution Control 
District portion of the California State Implementation Plan. These 
revisions concern a local fee rule that applies to major sources of 
volatile organic compound and nitrogen oxide emissions within the San 
Joaquin Valley ozone nonattainment area. We are approving a local rule 
that regulates these emission sources under the Clean Air Act as 
amended in 1990. We are taking comments on this proposal and plan to 
follow with a final action.

DATES: Any comments must arrive by August 13, 2009.

ADDRESSES: Submit comments, identified by docket number EPA-R09-OAR-
2009-0024, by one of the following methods:
    1. Federal eRulemaking Portal: http://www.regulations.gov. Follow 
the on-line instructions.
    2. E-mail: steckel.andrew@epa.gov.
    3. Mail or deliver: Andrew Steckel (Air-4), U.S. Environmental 
Protection Agency Region IX, 75 Hawthorne Street, San Francisco, CA 
94105-3901.
    Instructions: All comments will be included in the public docket 
without change and may be made available online at http://www.regulations.gov, including any personal information provided, 
unless the comment includes Confidential Business Information (CBI) or 
other information whose disclosure is restricted by statute. 
Information that you consider CBI or otherwise protected should be 
clearly identified as such and should not be submitted through http://www.regulations.gov or e-mail. http://

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www.regulations.gov is an ``anonymous access'' system, and EPA will not 
know your identity or contact information unless you provide it in the 
body of your comment. If you send e-mail directly to EPA, your e-mail 
address will be automatically captured and included as part of the 
public comment. If EPA cannot read your comment due to technical 
difficulties and cannot contact you for clarification, EPA may not be 
able to consider your comment.
    Docket: The index to the docket for this action is available 
electronically at http://www.regulations.gov and in hard copy at EPA 
Region IX, 75 Hawthorne Street, San Francisco, California. While all 
documents in the docket are listed in the index, some information may 
be publicly available only at the hard copy location (e.g., copyrighted 
material), and some may not be publicly available in either location 
(e.g., CBI). To inspect the hard copy materials, please schedule an 
appointment during normal business hours with the contact listed in the 
FOR FURTHER INFORMATION CONTACT section.

FOR FURTHER INFORMATION CONTACT: Mae Wang, EPA Region IX, (415) 947-
4124, wang.mae@epa.gov.

SUPPLEMENTARY INFORMATION: Throughout this document, ``we,'' ``us'' and 
``our'' refer to EPA.

Table of Contents

I. The State's Submittal
    A. What Rule did the State Submit?
    B. What is the Purpose of the Submitted Rule?
    C. Why was this Rule Submitted?
II. EPA's Evaluation and Action
    A. How Is EPA Evaluating the Rule?
    B. Does the Rule Meet the Evaluation Criteria?
    C. What are the Rule Deficiencies?
    D. Proposed Action and Public Comment
III. Statutory and Executive Order Reviews

I. The State's Submittal

A. What Rule Did the State Submit?

    The San Joaquin Valley Unified Air Pollution Control District 
(SJVUAPCD) adopted Rule 3170, Federally Mandated Ozone Nonattainment 
Fee, on May 16, 2002. This rule was submitted by the California Air 
Resources Board (CARB) on August 6, 2002, for incorporation into the 
California State Implementation Plan (SIP). On August 30, 2002, this 
rule submittal was found to meet the completeness criteria in 40 CFR 
Part 51 Appendix V, which must be met before formal EPA review.

B. What Is the Purpose of the Submitted Rule?

    SJVUAPCD Rule 3170 requires major stationary sources of volatile 
organic compounds (VOCs) and nitrogen oxides (NOX) in the 
San Joaquin Valley ozone nonattainment area to pay a fee to the 
SJVUAPCD if the area fails to attain the 1-hour national ambient air 
quality standard (NAAQS) for ozone by its Federally established 
attainment year. The fee must be paid beginning in the second year 
after the attainment year, and in each calendar year thereafter, until 
the area is redesignated to attainment of the 1-hour ozone standard.

C. Why Was This Rule Submitted?

    Under sections 182(d)(3), (e), and 185 of the Clean Air Act as 
amended in 1990 (CAA or the Act), States are required to adopt an 
excess emissions fee regulation for ozone nonattainment areas 
classified as severe or extreme. The 1-hour ozone NAAQS classification 
for the San Joaquin Valley area is extreme (see 69 FR 20550, April 16, 
2004). The fee regulation specified by the Act requires major 
stationary sources of VOCs in the nonattainment area to pay a fee to 
the State if the area fails to attain the standard by the attainment 
date set forth in the Act. Section 182(f) of the Act requires States to 
apply the same requirements to major stationary sources of 
NOX as are applied to major stationary sources of VOCs. 
Emissions of VOCs and NOX play a role in producing ground-
level ozone and smog, which harm human health and the environment. 
SJVUAPCD Rule 3170 applies to major sources of both NOX and 
VOCs. EPA's technical support document (TSD) has more information about 
this rule.

II. EPA's Evaluation and Action

A. How is EPA Evaluating the Rule?

    Generally, SIP rules must be enforceable (see section 110(a) of the 
Act), and must not relax existing requirements (see sections 110(l) and 
193). Due to the limited national guidance available relevant to these 
sorts of nonattainment fee rules, Rule 3170 was primarily evaluated for 
compliance with the requirements in CAA section 185. The rule was also 
evaluated for consistency with the CAA and EPA's general SIP policies, 
as well as a March 21, 2008, memorandum from William Harnett, Director 
of the Air Quality Policy Division, to the Regional Air Division 
Directors, entitled, ``Guidance on Establishing Emissions Baselines 
under Section 185 of the Clean Air Act (CAA) for Severe and Extreme 
Ozone Nonattainment Areas that Fail to Attain the 1-hour Ozone NAAQS by 
their Attainment Date.'' Guidance and policy documents that we use to 
help evaluate specific enforceability requirements typically include 
the following:
    1. ``Issues Relating to VOC Regulation Cutpoints, Deficiencies, and 
Deviations,'' EPA, May 25, 1988 (the Bluebook).
    2. ``Guidance Document for Correcting Common VOC & Other Rule 
Deficiencies,'' EPA Region 9, August 21, 2001 (the Little Bluebook).
    3. ``State Implementation Plans; Nitrogen Oxides Supplement to the 
General Preamble; Clean Air Act Amendments of 1990 Implementation of 
Title I; Proposed Rule,'' (the NOX Supplement), 57 FR 55620, 
November 25, 1992.

B. Does the Rule Meet the Evaluation Criteria?

    Rule 3170 improves the SIP by establishing an excess emissions fee 
regulation as required by the CAA. The rule is largely consistent with 
the CAA, as well as relevant policy and guidance regarding 
enforceability and SIP relaxations. Rule provisions which do not meet 
the evaluation criteria are summarized below and discussed further in 
the TSD.

C. What Are the Rule Deficiencies?

    The following provisions conflict with section 185 of the Act and 
prevent full approval of the SIP revision:
    Section 4.2 exempts units that begin operation after the attainment 
year. CAA Section 185 does not provide for such an exemption, so this 
exemption does not fully comply with the CAA.
    Section 4.3 exempts any ``clean emission unit'' from the 
requirements of the rule. Section 3.6 defines a clean emission unit as 
a unit that is equipped with an emissions control technology that 
either has a minimum 95% control efficiency (or 85% for lean-burn 
internal combustion engines), or meets the requirements for achieved-
in-practice Best Achievable Control Technology as accepted by the APCO 
during the 5 years immediately prior to the end of the attainment year. 
The District's staff report for Rule 3170 states that the exemption is 
intended to address ``the difficulty of reducing emissions from units 
with recently installed BACT.'' Although EPA understands the District's 
intended purpose for including the exemption, the exemption does not 
comply with CAA section 185.
    Section 3.2.1 defines the baseline period as two consecutive years 
consisting of the attainment year and the year immediately prior to the 
attainment year. CAA Section 185(b)(2) provides the option for 
calculating baseline emissions over a period of more than one calendar 
year if a

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source's emissions are irregular, cyclical, or otherwise vary 
significantly from year to year. Since Section 3.2.2 allows an 
alternative baseline, then Section 3.2.1 should describe the normal 
baseline calculation which should be based only on the attainment year 
emissions.
    Section 3.2.2 allows averaging over 2-5 years to establish baseline 
emissions. CAA Section 185(b)(2) states that EPA may issue guidance 
authorizing such an alternative method of calculating baseline 
emissions if a source's emissions are irregular, cyclical, or otherwise 
vary significantly from year to year. EPA issued guidance on 
alternative methods for calculating baseline emissions in the form of 
the memorandum from William Harnett, mentioned above. The averaging 
period allowed in Section 3.2.2 of Rule 3170 appears consistent with 
the March 21, 2008, guidance. However, the language in Section 3.2.2 
allows such averaging ``if those years are determined by the APCO as 
more representative of normal source operation.'' This language is 
considered less stringent than the CAA criteria. The rule should be 
amended to specify use of the expanded averaging period only if a 
source's emissions are irregular, cyclical, or otherwise vary 
significantly from year to year.

D. Proposed Action and Public Comment

    As authorized in sections 110(k)(3) and 301(a) of the Act, EPA is 
proposing a limited approval of the submitted rule to improve the SIP. 
If finalized, this action would incorporate the submitted rule into the 
SIP, including those provisions identified as deficient. This approval 
is limited because EPA is simultaneously proposing a limited 
disapproval of the rule under section 110(k)(3). If this disapproval is 
finalized, sanctions will be imposed under section 179 of the Act 
unless EPA approves subsequent SIP revisions that correct the rule 
deficiencies within 18 months. These sanctions would be imposed 
according to 40 CFR 52.31. A final disapproval would also trigger the 
Federal implementation plan (FIP) requirement under section 110(c). 
Note that the submitted rule has been adopted by the SJVUAPCD, and 
EPA's final limited disapproval would not prevent the local agency from 
enforcing it.
    However, the limited approval of Rule 3170 does not override 
specific CAA mandates. If the area fails to attain by its 2010 
attainment date, fees will accrue beginning in 2011 for emissions above 
80% of source baselines for clean units and new units which are 
exempted from fee collection under the State rule. The State must adopt 
and submit a rule to collect fees for 2011 and future years from those 
units or, consistent with the Administrator's obligation under Sec.  
185(d), EPA will collect those fees. In addition, all sources are 
liable for fees calculated in accordance with the baseline definition 
in Sec.  185(b)(2) and EPA guidance issued pursuant to that provision. 
The State must adopt and submit a rule that ensures fees are collected 
for 2011 and all future applicable years based on the statutory 
baseline requirement. If the State fails to do so, EPA will collect any 
additional fees owed pursuant to a Federal program under Sec.  185(d).
    We will accept comments from the public on the proposed limited 
approval and limited disapproval for the next 30 days.

III. Statutory and Executive Order Reviews

A. Executive Order 12866, Regulatory Planning and Review

    The Office of Management and Budget (OMB) has exempted this 
regulatory action from Executive Order 12866, entitled ``Regulatory 
Planning and Review.''

B. Paperwork Reduction Act

    This action does not impose an information collection burden under 
the provisions of the Paperwork Reduction Act, 44 U.S.C. 3501 et seq. 
Burden is defined at 5 CFR 1320.3(b).

C. Regulatory Flexibility Act

    The Regulatory Flexibility Act (RFA) generally requires an agency 
to conduct a regulatory flexibility analysis of any rule subject to 
notice and comment rulemaking requirements unless the agency certifies 
that the rule will not have a significant economic impact on a 
substantial number of small entities. Small entities include small 
businesses, small not-for-profit enterprises, and small governmental 
jurisdictions.
    This rule will not have a significant impact on a substantial 
number of small entities because SIP approvals under section 110 and 
subchapter I, part D of the Clean Air Act do not create any new 
requirements but simply approve requirements that the State is already 
imposing. Therefore, because the Federal SIP approval does not create 
any new requirements, I certify that this action will not have a 
significant economic impact on a substantial number of small entities.
    Moreover, due to the nature of the Federal-State relationship under 
the Clean Air Act, preparation of flexibility analysis would constitute 
Federal inquiry into the economic reasonableness of State action. The 
Clean Air Act forbids EPA to base its actions concerning SIPs on such 
grounds. Union Electric Co., v. U.S. EPA, 427 U.S. 246, 255-66 (1976); 
42 U.S.C. 7410(a)(2).

D. Unfunded Mandates Reform Act

    Under section 202 of the Unfunded Mandates Reform Act of 1995 
(``Unfunded Mandates Act''), signed into law on March 22, 1995, EPA 
must prepare a budgetary impact statement to accompany any proposed or 
final rule that includes a Federal mandate that may result in estimated 
costs to State, local, or Tribal governments in the aggregate; or to 
the private sector, of $100 million or more. Under section 205, EPA 
must select the most cost-effective and least burdensome alternative 
that achieves the objectives of the rule and is consistent with 
statutory requirements. Section 203 requires EPA to establish a plan 
for informing and advising any small governments that may be 
significantly or uniquely impacted by the rule.
    EPA has determined that the approval action proposed does not 
include a Federal mandate that may result in estimated costs of $100 
million or more to either State, local, or Tribal governments in the 
aggregate, or to the private sector. This Federal action proposes to 
approve pre-existing requirements under State or local law, and imposes 
no new requirements. Accordingly, no additional costs to State, local, 
or Tribal governments, or to the private sector, result from this 
action.

E. Executive Order 13132, Federalism

    Federalism (64 FR 43255, August 10, 1999) revokes and replaces 
Executive Orders 12612 (Federalism) and 12875 (Enhancing the 
Intergovernmental Partnership). Executive Order 13132 requires EPA to 
develop an accountable process to ensure ``meaningful and timely input 
by State and local officials in the development of regulatory policies 
that have federalism implications.'' ``Policies that have federalism 
implications'' is defined in the Executive Order to include regulations 
that have ``substantial direct effects on the States, on the 
relationship between the national government and the States, or on the 
distribution of power and responsibilities among the various levels of 
government.'' Under Executive Order 13132, EPA may not issue a 
regulation that has federalism implications, that imposes substantial 
direct compliance costs, and that is not

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required by statute, unless the Federal government provides the funds 
necessary to pay the direct compliance costs incurred by State and 
local governments, or EPA consults with State and local officials early 
in the process of developing the proposed regulation. EPA also may not 
issue a regulation that has federalism implications and that preempts 
State law unless the Agency consults with State and local officials 
early in the process of developing the proposed regulation.
    This rule will not have substantial direct effects on the States, 
on the relationship between the national government and the States, or 
on the distribution of power and responsibilities among the various 
levels of government, as specified in Executive Order 13132, because it 
merely approves a State rule implementing a Federal standard, and does 
not alter the relationship or the distribution of power and 
responsibilities established in the Clean Air Act. Thus, the 
requirements of section 6 of the Executive Order do not apply to this 
rule.

F. Executive Order 13175, Coordination With Indian Tribal Governments

    Executive Order 13175, entitled ``Consultation and Coordination 
with Indian Tribal Governments'' (65 FR 67249, November 9, 2000), 
requires EPA to develop an accountable process to ensure ``meaningful 
and timely input by Tribal officials in the development of regulatory 
policies that have Tribal implications.'' This proposed rule does not 
have Tribal implications, as specified in Executive Order 13175. It 
will not have substantial direct effects on Tribal governments, on the 
relationship between the Federal government and Indian Tribes, or on 
the distribution of power and responsibilities between the Federal 
government and Indian Tribes. Thus, Executive Order 13175 does not 
apply to this rule.
    EPA specifically solicits additional comment on this proposed rule 
from Tribal officials.

G. Executive Order 13045, Protection of Children From Environmental 
Health Risks and Safety Risks

    EPA interprets Executive Order 13045 (62 FR 19885, April 23, 1997) 
as applying only to those regulatory actions that concern health or 
safety risks, such that the analysis required under section 5-501 of 
the Executive Order has the potential to influence the regulation. This 
rule is not subject to Executive Order 13045, because it approves a 
State rule implementing a Federal standard.

H. Executive Order 13211, Actions That Significantly Affect Energy 
Supply, Distribution, or Use

    This rule is not subject to Executive Order 13211, ``Actions 
Concerning Regulations That Significantly Affect Energy Supply, 
Distribution, or Use'' (66 FR 28355, May 22, 2001) because it is not a 
significant regulatory action under Executive Order 12866.

I. National Technology Transfer and Advancement Act

    Section 12 of the National Technology Transfer and Advancement Act 
(NTTAA) of 1995 requires Federal agencies to evaluate existing 
technical standards when developing a new regulation. To comply with 
NTTAA, EPA must consider and use ``voluntary consensus standards'' 
(VCS) if available and applicable when developing programs and policies 
unless doing so would be inconsistent with applicable law or otherwise 
impractical.
    The EPA believes that VCS are inapplicable to this action. Today's 
action does not require the public to perform activities conducive to 
the use of VCS.

List of Subjects in 40 CFR Part 52

    Environmental protection, Air pollution control, Intergovernmental 
relations, Nitrogen dioxide, Ozone, Reporting and recordkeeping 
requirements, Volatile organic compounds.

    Authority: 42 U.S.C. 7401 et seq.

    Dated: June 30, 2009.
Jane Diamond,
Acting Regional Administrator, Region IX.
[FR Doc. E9-16642 Filed 7-13-09; 8:45 am]
BILLING CODE 6560-50-P


