[Federal Register Volume 86, Number 10 (Friday, January 15, 2021)]
[Rules and Regulations]
[Pages 3820-3826]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-28020]


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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[EPA-R09-OAR-2019-0176; FRL-10017-96-Region 9]


Air Plan Approval; California; South Coast Air Quality Management 
District

AGENCY: Environmental Protection Agency (EPA).

ACTION: Final rule.

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SUMMARY: The Environmental Protection Agency (EPA) is taking final 
action to approve a revision to the South Coast Air Quality Management 
District (SCAQMD) portion of the California State Implementation Plan 
(SIP). This revision concerns emissions of oxides of nitrogen 
(NOX) from on-road heavy-duty vehicles. We are approving a 
local measure to reduce emissions from these sources under the Clean 
Air Act (CAA or the Act).

DATES: This rule will be effective on February 16, 2021.

ADDRESSES: The EPA has established a docket for this action under 
Docket ID No. EPA-R09-OAR-2019-0176. All documents in the docket are 
listed on the http://www.regulations.gov website. Although listed in 
the index, some information is not publicly available, e.g., 
Confidential Business Information or other information whose disclosure 
is restricted by statute. Certain other material, such as copyrighted 
material, is not placed on the internet and will be publicly available 
only in hard copy form. Publicly available docket materials are 
available through http://www.regulations.gov, or please contact the 
person identified in the FOR FURTHER INFORMATION CONTACT section for 
additional availability information. If you need assistance in a 
language other than English or if you are a person with disabilities 
who needs a reasonable accommodation at no cost to you, please contact 
the person identified in the FOR FURTHER INFORMATION CONTACT section.

FOR FURTHER INFORMATION CONTACT: Rebecca Newhouse, EPA Region IX, 75 
Hawthorne St., San Francisco, CA 94105. By phone: (415) 972-3004 or by 
email at newhouse.rebecca@epa.gov.

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

Table of Contents

I. Proposed Action
II. Public Comments and EPA Responses
III. Final Action
IV. Statutory and Executive Order Reviews

I. Proposed Action

    On April 25, 2019 (84 FR 17365), the EPA proposed to approve the 
following measure, submitted by the California Air Resources Board 
(CARB), into the California SIP.

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             Local agency               Resolution #        Measure title           Adopted         Submitted
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CARB.................................            18-3  South Coast On-Road            03/22/18         05/04/18
                                                        Heavy-Duty Vehicle
                                                        Incentive Measure.
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    We proposed to approve the South Coast On-Road Heavy-Duty Vehicle 
Incentive Measure based on a determination that it satisfies the 
applicable CAA requirements for approval of voluntary measures for SIP

[[Page 3821]]

emission reduction credit. Our proposal was based on our evaluation of 
the documents provided in the SIP submission, including the measure 
itself (i.e., the State commitments set forth on page 5 of CARB 
Resolution 18-3), CARB's analysis of the measure in a document entitled 
``South Coast On-Road Heavy-Duty Vehicle Incentive Measure,'' Release 
Date: February 16, 2018 (hereafter ``Demonstration''), and a document 
entitled ``Additional Information for the South Coast On-Road Heavy-
Duty Vehicle Incentive Measure.'' Our proposed rule and associated 
technical support document (TSD) \1\ contain more information about the 
SIP submission and our evaluation thereof.
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    \1\ EPA Region IX, ``Technical Support Document for EPA's 
Rulemaking for the California State Implementation Plan, California 
Air Resources Board Resolution 18-3, South Coast On-Road Heavy-Duty 
Vehicle Incentive Measure,'' April 2019.
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    On November 24, 2020, CARB submitted a technical clarification to 
the South Coast On-Road Heavy-Duty Vehicle Incentive Measure that 
clarifies its commitment to make certain documents concerning the 
incentive projects implemented to achieve emission reductions available 
to the public upon request. CARB adopted this technical clarification 
to the measure by Executive Order S-20-030 (November 23, 2020).\2\ We 
refer to CARB's commitments in Resolution 18-3, as clarified by 
Executive Order S-20-030, as the ``South Coast Incentive Measure.''
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    \2\ Letter dated November 23, 2020, from Richard W. Corey, 
Executive Officer, CARB, to John W. Busterud, Regional 
Administrator, EPA Region IX (transmitting, inter alia, CARB 
Executive Order S-20-030, ``Adoption and Submittal of Technical 
Clarifications to the South Coast On-Road Heavy-Duty Incentive 
Measure,'' November 23, 2020).
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II. Public Comments and EPA Responses

    The EPA's proposed action provided a 30-day public comment period. 
During this period, we received comments from Earthjustice, on behalf 
of a coalition of environmental and community organizations, and 
comments from an anonymous commenter.\3\
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    \3\ Letter dated May 28, 2019, from Adriano L. Martinez, 
Earthjustice, to Rynda Kay, EPA, Region IX, Subject: ``Docket ID No. 
EPA-R09-OAR-2019-0176'' (on behalf of the California Communities 
Against Toxics, Center for Community Action and Environmental 
Justice, Coalition for a Safe Environment, and the Natural Resources 
Defense Council) and letter dated May 28, 2019, from anonymous 
commenter.
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    We respond below to a selection of the most significant comments on 
our proposed rule. We respond to all other comments that are germane to 
the proposed rule in our separate Response to Comments document 
available at https://www.regulations.gov, Docket ID No. EPA- R09-OAR-
2019-0176. We do not respond to the comments from the anonymous 
commenter because they fail to identify any specific issue that is 
germane to our action on this measure.
    Comment 1: Earthjustice states that the South Coast Incentive 
Measure does not satisfy the enforceability requirements in section 
110(a)(2)(A) of the CAA. Citing the EPA's Memo to Docket for a 
rulemaking entitled ``State Implementation Plans: Response to Petition 
for Rulemaking; Finding of Substantial Inadequacy; and SIP Calls to 
Amend Provisions Applying to Excess Emissions During Periods of 
Startup, Shutdown, and Malfunction,'' Earthjustice states that to be 
``enforceable,'' a measure must be enforceable by the state, the EPA, 
and citizens. Earthjustice also states that the mere approval of a 
measure into the SIP does not convert an unenforceable provision into 
an enforceable one, and that the EPA's SIP rulemaking must explain how 
the proposed measure can be enforced. According to Earthjustice, the 
EPA's proposed rule to approve the South Coast Incentive Measure has 
not provided a legally defensible analysis of how this rule is 
enforceable.
    Response 1: We agree with Earthjustice's statement that the mere 
approval of a measure into the SIP does not convert an unenforceable 
provision into an enforceable one, but we disagree with Earthjustice's 
claim that CARB's commitments in the South Coast Incentive Measure are 
not enforceable. We explain below how the EPA and citizens may enforce 
the provisions of CARB's SIP commitments in the South Coast Incentive 
Measure. We respond to Earthjustice's more specific comments concerning 
enforceability in our responses to comments 2 through 11. We note that 
our evaluation here is limited to CARB's commitments in the South Coast 
Incentive Measure and that the EPA will review each incentive-based 
control measure submitted by a state on a case-by-case basis, following 
notice-and-comment rulemaking, to determine whether the applicable 
requirements of the Act are met.
    Under CAA section 110(a)(2)(A), SIPs must include enforceable 
emission limitations and other control measures, means or techniques 
necessary to meet the requirements of the Act, as well as timetables 
for compliance. Similarly, section 172(c)(6) provides that 
nonattainment area SIPs must include enforceable emission limitations 
and such other control measures, means or techniques as may be 
necessary or appropriate to provide for attainment of the national 
ambient air quality standards (NAAQS) by the applicable attainment 
date.
    Control measures, including commitments in SIPs, are enforced 
through CAA section 304(a), which provides for citizen suits to be 
brought against any ``person,'' including a state,\4\ who is alleged 
``to be in violation of . . . an emission standard or limitation. . 
..'' ``Emission standard or limitation'' is defined in subsection (f) 
of section 304.\5\ As observed in Conservation Law Foundation, Inc. v. 
James Busey et al., 79 F.3d 1250, 1258 (1st Cir. 1996):
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    \4\ CAA section 302(e) (defining ``person'' to include a State 
or political subdivision thereof).
    \5\ Section 304(f) of the CAA defines ``emission standard or 
limitation,'' in relevant part, to mean ``a schedule or timetable of 
compliance'' which is in effect under the Act ``or under an 
applicable implementation plan.'' Section 302(p) of the Act defines 
``schedule and timetable of compliance'' to mean ``a schedule of 
required measures including an enforceable sequence of actions or 
operations leading to compliance with an emission limitation, other 
limitation, prohibition, or standard.'' Section 302(q) of the Act 
defines ``[a]pplicable implementation plan,'' in relevant part, as 
``the portion (or portions) of the implementation plan, or most 
recent revision thereof, which has been approved under section 110 
of [title I of the Act] . . . and which implements the relevant 
requirements of [the Act].''

    Courts interpreting citizen suit jurisdiction have largely 
focused on whether the particular standard or requirement plaintiffs 
sought to enforce was sufficiently specific. Thus, interpreting 
citizen suit jurisdiction as limited to claims ``for violations of 
specific provisions of the act or specific provisions of an 
applicable implementation plan,'' the Second Circuit held that suits 
can be brought to enforce specific measures, strategies, or 
commitments designed to ensure compliance with the NAAQS, but not to 
enforce the NAAQS directly. See, e.g., Wilder, 854 F.2d at 613-14. 
Courts have repeatedly applied this test as the linchpin of citizen 
suit jurisdiction. See, e.g., Coalition Against Columbus Ctr. v. 
City of New York, 967 F.2d 764, 769-71 (2d Cir. 1992); Cate v. 
Transcontinental Gas Pipe Line Corp., 904 F. Supp. 526, 530-32 (W.D. 
Va. 1995); Citizens for a Better Env't v. Deukmejian, 731 F. Supp. 
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1448, 1454-59 (N.D. Cal.), modified, 746 F. Supp. 976 (1990).

    Thus, courts have found that the citizen suit provision cannot be 
used to enforce the aspirational goal of attaining the NAAQS but can be 
used to enforce specific strategies to achieve that goal.\6\
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    \6\ See also Committee for a Better Arvin, et al. v. EPA, 786 
F.3d 1169, 1181 (9th Cir. 2015) (finding that California's 
commitments to propose and adopt emission control measures and to 
achieve aggregate emission reductions are enforceable ``emission 
standards or limitations'' under the CAA).
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    SIP control measures and commitments may also be enforced by the 
EPA under section 113(a)(1) of the Act, which authorizes the EPA to 
issue notices and compliance orders, assess administrative penalties, 
and bring civil actions against any ``person,'' including

[[Page 3822]]

a state, who ``has violated or is in violation of any requirement or 
prohibition of an applicable implementation plan. . . .'' \7\
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    \7\ CAA section 113(a)(1)-(2) (establishing EPA's SIP 
enforcement authorities), section 302(e) (defining ``person'' to 
include a state or political subdivision thereof), and section 
302(q) (defining ``applicable implementation plan'' to include the 
portion(s) of the implementation plan approved under CAA section 110 
that implement relevant CAA requirements).
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    CARB's commitments in the South Coast Incentive Measure are set 
forth on page 5 of CARB Resolution 18-3 (March 22, 2018), as clarified 
by Executive Order S-20-030 (November 23, 2020),\8\ and include six key 
components, as summarized below:
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    \8\ CARB Resolution 18-3, ``South Coast On-Road Heavy Duty 
Vehicle Incentive Measure'' (March 22, 2018), 5 and CARB Executive 
Order S-20-030, ``Adoption and Submittal of Technical Clarifications 
to the South Coast On-Road Heavy-Duty Incentive Measure'' (November 
23, 2020) (hereafter ``South Coast Incentive Measure'').

    (1) A commitment to monitor the District's implementation of 
1,300 on-road heavy-duty compression ignition truck repower and 
replacement projects in accordance with specified portions of the 
2017 Carl Moyer Guidelines;
    (2) a commitment to achieve 1 ton per day (tpd) of reductions in 
NOX emissions from the 2023 baseline inventory in the 
2016 South Coast AQMP through implementation of these repower or 
replacement projects or substitute measures in the South Coast Air 
Basin (hereafter ``tonnage commitment'');
    (3) a commitment to submit reports to the EPA by March 31 of 
each year from 2020 through 2023, each of which must include, among 
other things, specific information about the incentive projects 
funded through the previous year, about changes to the applicable 
guidelines, and about actions by CARB and the District to monitor 
projects for compliance with contract requirements (hereafter 
``annual demonstration reports'');
    (4) a commitment to make each annual demonstration report 
publicly available or available upon request;
    (5) a commitment to provide to the public, upon request, certain 
project-specific documents relied upon in the preparation of CARB's 
annual demonstration reports, including project applications, grant 
contracts, and inspection-related documents, and
    (6) a commitment to adopt and submit to the EPA, by September 1, 
2022, substitute measures or rules that address any shortfall in 
emission reductions required to meet the tonnage commitment by no 
later than January 1, 2023, if the EPA determines by July 1, 2021 
that information submitted by CARB is insufficient to demonstrate 
that it will fulfill the tonnage commitment on schedule.\9\
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    \9\ Id. We use the shorthand term ``insufficiency finding'' to 
refer to a determination by the EPA that information submitted by 
CARB is insufficient to demonstrate that CARB will fulfill the 
tonnage commitment on schedule. An insufficiency finding by the EPA 
triggers CARB's obligation, under the terms of paragraph 5 of the 
South Coast Incentive Measure, to adopt and submit substitute 
measures and/or rules that address any shortfall in required 
emission reductions.
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    In the Demonstration, CARB states that ``CARB is the responsible 
party for enforcement of this measure and is responsible for achieving 
the emission reductions from this measure,'' \10\ thus expressing 
CARB's decision to voluntarily commit itself to fulfilling the tonnage 
commitment and to being held accountable for failure to fulfill this 
commitment.
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    \10\ Demonstration, 14.
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    Upon the EPA's approval of these commitments into the SIP under CAA 
section 110, the commitments will become federally enforceable 
requirements of an ``applicable implementation plan'' as defined in CAA 
section 302(q). Therefore, as discussed below, both citizens and the 
EPA may enforce these commitments under CAA sections 304(a)(1) and 
113(a)(1), respectively. We describe each enforceable component of the 
South Coast Incentive Measure below.
    First, the South Coast Incentive Measure obligates CARB to monitor 
District implementation of 1,300 on-road heavy-duty compression 
ignition truck repower and replacement projects in accordance with 
specified portions of the 2017 Carl Moyer Guidelines.\11\ The 2017 Carl 
Moyer Guidelines enable CARB to carry out its oversight 
responsibilities by requiring, among other things, that air districts 
(1) maintain, for specified periods of time, all project-related 
documentation obtained from participating sources and through the air 
district's on-site project inspections; \12\ (2) make such documents 
available to CARB staff during CARB's periodic ``incentive program 
reviews'' and upon request; \13\ (3) submit a certified ``yearly 
report'' to CARB containing specific information about funded projects, 
including information sufficient to calculate emission reductions and 
cost-effectiveness for source categories where required; \14\ and (4) 
allow CARB and its designees to conduct fiscal audits and to inspect 
project engines, vehicles, and/or equipment and associated records 
during the contract term.\15\ The 2017 Carl Moyer Guidelines also 
specifically identify types of actions on the part of the implementing 
air district that CARB may treat as violations of program 
requirements--e.g., misuse of Carl Moyer Program funds to fund 
ineligible projects and insufficient, incomplete, or inaccurate project 
documentation \16\--and authorize CARB to enforce the terms of a 
project contract at any time during the contract term to ensure that 
emission reductions are obtained.\17\ If CARB fails to document in each 
annual demonstration report the steps it has taken to exercise these 
monitoring responsibilities, that failure would constitute a violation 
of the SIP commitment.
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    \11\ South Coast Incentive Measure, para. 1. CARB is required 
under California law to monitor air district implementation of Carl 
Moyer projects to ensure compliance with the applicable guidelines. 
California Health & Safety Code (Ca. HSC) section 44291(d) 
(requiring CARB to ``monitor district programs to ensure that 
participating districts conduct their programs consistent with the 
criteria and guidelines established by the state board and the 
commission pursuant to this chapter'').
    \12\ The 2017 Carl Moyer Guidelines require that each 
implementing air district maintain a file for each funded project (a 
``project file'') that includes, among other things, a copy of the 
application, a copy of the executed project contract and any related 
amendments, photographic and other documentation of the baseline 
(replaced) engine, vehicle, or equipment, and photographic and other 
documentation of the new engine, vehicle, or equipment. 2017 Carl 
Moyer Guidelines, Volume I, Part 1, Chapter 3, Section S 
(``Requirements for Project Applications''), para. 2; Section T 
(``Application Evaluation and Project Selection''), paras. 1 and 8; 
Section V (``Minimum Contract Requirements''); Section W (``Project 
Pre-Inspection''); and Section X (``Project Post-Inspection''). Air 
districts must generally maintain each project file for three years 
after the end of the contract term. Id. at Section T (``Application 
Evaluation and Project Selection''), para. 8.
    \13\ Id. at Section M (``Yearly Report''), para. 4 and Section R 
(``Incentive Program Review''), para. 5.
    \14\ Id. at Section M (``Yearly Report'').
    \15\ Id. at Section V (``Minimum Contract Requirements''), para. 
10.
    \16\ Id. at Section Q (``Program Nonperformance'').
    \17\ Id. at Section V (``Minimum Contract Requirements''), para. 
11 (``Repercussions for NonPerformance'').
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    Second, the South Coast Incentive Measure obligates CARB to 
achieve, by December 31, 2022, 1 tpd of reductions in NOX 
emissions from the 2023 baseline inventory \18\ in the 2016 South Coast 
AQMP through implementation of these projects in the South Coast Air 
Basin or substitute measures and/or rules consistent with paragraph 5 
of the commitment.\19\ If CARB fails to achieve 1 tpd of NOX 
emission reductions by December 31, 2022 through implementation of the 
identified incentive projects or substitute measures and/or rules that 
meet the identified criteria, that failure would constitute a violation 
of the SIP commitment.
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    \18\ CARB uses the term ``baseline inventory'' to refer to the 
projected emissions inventories for future years that account for, 
among other things, the ongoing effects of economic growth and 
adopted emissions control requirements.
    \19\ South Coast Incentive Measure, para. 2. We understand that 
the reference to ``substitute measures'' in paragraph 2 is intended 
to reference the ``substitute measures and/or rules'' that CARB must 
adopt and submit under paragraph 5 if the EPA determines that 
information submitted by CARB fails to demonstrate that CARB will 
fulfill the tonnage commitment on schedule.
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    Third, the South Coast Incentive Measure obligates CARB to submit

[[Page 3823]]

annual demonstration reports to the EPA by March 31 each year from 2020 
through 2023, each of which must include, among other things, specific 
information about the incentive projects funded through the previous 
year, about changes to the applicable guidelines, and about actions by 
CARB and the District to monitor projects for compliance with contract 
requirements.\20\ If CARB fails to timely submit an annual 
demonstration report containing all of the information listed in 
paragraph 3 of the South Coast Incentive Measure, that failure would 
constitute a violation of the SIP commitment.
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    \20\ Id. at para. 3.
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    Fourth, the South Coast Incentive Measure obligates CARB to make 
each annual demonstration report publicly available or available upon 
request. If CARB fails to make any annual demonstration report publicly 
available or to provide it within a reasonable period after receiving a 
request for it, that failure would constitute a violation of the SIP 
commitment.
    Fifth, the South Coast Incentive Measure obligates CARB to provide 
to any requestor, beginning May 15, 2021 and through 2029, certain 
project-specific documents relied upon in the preparation of CARB's 
annual demonstration reports, including project applications, grant 
contracts, and inspection-related documents. If CARB fails to provide 
any of these project records within a reasonable period after receiving 
a request, that failure would constitute a violation of the SIP 
commitment.
    Finally, the South Coast Incentive Measure obligates CARB to adopt 
and submit to the EPA, by September 1, 2022, substitute measures and/or 
rules that address any shortfall in emission reductions no later than 
January 1, 2023, if the EPA determines by July 1, 2021 that information 
submitted by CARB is insufficient to demonstrate that it will fulfill 
the tonnage commitment on schedule. If CARB fails to adopt and submit 
timely substitute measures and/or rules sufficient to address a 
shortfall in required emission reductions, this failure would 
constitute a violation of the SIP commitment. We provide a more 
detailed discussion of CARB's obligation to adopt and submit substitute 
measures in Response 7 in the Response to Comments document.
    This series of actions mandated by the South Coast Incentive 
Measure constitutes a specific enforceable strategy for achieving a 
specific amount of NOX emission reductions by the beginning 
of 2023. The fact that CARB may meet its SIP commitments by adopting 
measures that are not specifically identified in the SIP, or through 
one of several available techniques, does not render the requirement to 
achieve the emissions reductions unenforceable.\21\
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    \21\ Citizens for a Better Environment v. Deukmejian, 731 F. 
Supp. 1448, 1454-59 (N.D. Cal. 1990) (``the basic commitment to 
adopt and implement additional measures, should the identified 
conditions occur, constitutes a specific strategy, fully enforceable 
in a citizens action, although the exact contours of those measures 
are not spelled out''), modified, 746 F. Supp. 976 (1990) (holding 
state and district liable for failing to satisfy SIP commitment).
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    For all of these reasons, we conclude that CARB's commitments in 
the South Coast Incentive Measure to monitor and report annually on the 
implementation of specific types of incentive projects, to achieve a 
specified tonnage of NOX emission reductions from these 
projects or substitute measures, to make the annual demonstration 
reports and related documentation available to the public, and to adopt 
and submit substitute control measures where necessary to address an 
emission reduction shortfall identified by the EPA, constitute 
appropriate means, techniques, or schedules for compliance under 
sections 110(a)(2)(A) and 172(c)(6) of the Act.
    Comment 2: Earthjustice states that citizens and the EPA can only 
enforce ``violations,'' and that the EPA must describe what would 
constitute a violation of the SIP provisions being approved here. 
Citing section 304(a)(1) of the CAA, Earthjustice states that citizens 
can commence civil actions for violations of emission standards or 
limitations or orders issued by the EPA or a state with respect to such 
standards or limitations. Additionally, citing section 113(a)(1) of the 
Act, Earthjustice states that the EPA can enforce a violation of any 
requirement or prohibition of an applicable implementation plan. 
According to Earthjustice, the EPA ``suggests that EPA and citizens can 
enforce the commitments to achieve and report on emission reductions'' 
but that the EPA and the South Coast Incentive Measure ``muddy what 
exactly would constitute a violation.''
    Earthjustice notes the EPA's statement in the TSD that to be 
enforceable, program violations must be defined, and asserts that the 
EPA must explain where in the South Coast Incentive Measure such 
definitions are provided.
    Response 2: We disagree with Earthjustice's claim that the 
commitments at issue in this action do not create obligations that EPA 
or citizens can enforce, were CARB or the District to violate them. We 
identify in Response 1 the types of violations of the commitments that 
could provide the basis for an enforcement action by the EPA or by 
citizens under section 113(a)(1) or 304(a)(1) of the CAA, respectively. 
As explained in Response 1, CARB's commitments, as set forth in the 
South Coast Incentive Measure, constitute a specific enforceable 
strategy for achieving 1 tpd of NOX emission reductions on a 
fixed schedule and, upon approval into the SIP, become requirements of 
an ``applicable implementation plan'' as defined in CAA section 302(q). 
Although the South Coast Incentive Measure does not specifically define 
potential violations of the commitments, we find that it describes each 
of the actions that CARB has committed to undertake in sufficient 
detail to enable the EPA and the public to determine whether and when a 
violation has occurred. Accordingly, these commitments are enforceable 
by citizens under CAA section 304(a)(1) and by the EPA under CAA 
section 113(a)(1).
    Comment 3: Earthjustice states that CARB's commitment to 
``monitor'' District implementation of projects in accordance with the 
Carl Moyer Guidelines is a ``vague and unenforceable commitment.'' 
Earthjustice asks what would constitute a violation, and how one could 
prove that CARB is not monitoring implementation in accordance with the 
guidelines. Earthjustice asserts that there is no means of measuring or 
independently verifying compliance because there is no reporting 
requirement and no deadline. Additionally, Earthjustice claims that the 
reference to ``1300 repower and replacement projects'' in CARB's 
commitment ``is a deliberate attempt to mislead the reader on what is 
actually required.'' For example, Earthjustice states, nothing in this 
monitoring ``requirement'' specifies that these projects actually need 
to occur.
    Response 3: We disagree with these comments. CARB's commitment to 
monitor District implementation of projects in accordance with the 2017 
Carl Moyer Guidelines is enforceable through specific provisions in the 
South Coast Incentive Measure that require CARB to, among other things, 
report annually on the incentive projects it is relying on to achieve 
emission reductions and the actions that CARB has taken to ensure that 
these projects comply with the contracts issued by the District in 
accordance with the 2017 Carl Moyer Guidelines. See Response 1.
    Specifically, the South Coast Incentive Measure obligates CARB to

[[Page 3824]]

identify, in each annual demonstration report submitted to the EPA by 
March 31 of each year from 2020 through 2023, those specific projects 
funded through the previous year that CARB is relying on to achieve the 
tonnage commitment. CARB must identify each of these projects ``by 
project identification number, project life and implementation date, 
description of both baseline and new equipment, applicable incentive 
program guidelines, and quantified emission reductions.'' \22\ 
Additionally, each annual demonstration report must describe any 
changes to the 2017 Carl Moyer Guidelines and related impacts on 
program integrity, describe CARB's and the District's actions to 
monitor selected projects for compliance with contract requirements, 
and contain CARB's determination of whether the identified projects are 
projected to achieve the full 1 tpd of NOX emission 
reductions in the South Coast Air Basin by 2023.\23\
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    \22\ South Coast Incentive Measure, para. 3.a. The ``project 
life'' begins on the purchase date of the new equipment and is the 
period during which the project is under contract. Email dated 
February 13, 2020, from Austin Hicks (CARB) to Rynda Kay (EPA Region 
IX), Subject: ``RE: Follow-up questions on the Valley Incentive 
Measure.'' We understand the ``implementation date'' to mean the 
post-inspection date, which is the date on which the District 
verifies that the old equipment has been destroyed and that the new 
equipment has been purchased, is operational, and is the same 
equipment that was used in the emission reduction calculations. 2017 
Carl Moyer Guidelines, Volume I, Part 1, Chapter 3, Section V 
(``Minimum Contract Requirements'') and Section X (``Project Post-
Inspection'').
    \23\ Id. at paras. 3.b-3.d.
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    These provisions ensure that CARB's annual demonstration reports 
will contain both the project-specific information needed to 
independently calculate the emission reductions that CARB attributes to 
each project and the programmatic information needed to determine 
whether CARB and the District are taking appropriate steps to ensure 
that the identified projects comply with contract terms, which in turn 
assure compliance with the 2017 Carl Moyer Guidelines.\24\ The 2017 
Carl Moyer Guidelines specifically require that air districts audit at 
least five percent of active Carl Moyer projects or 20 active projects 
(whichever is less), including any audits conducted following 
unsatisfactory annual reporting.\25\ If CARB's annual demonstration 
report for a given year fails to identify the project-specific 
information described in paragraph 3.a of the South Coast Incentive 
Measure or to document the steps that CARB and the District have taken 
to monitor selected projects for compliance with contract terms, 
consistent with paragraph 3.c of the South Coast Incentive Measure, the 
EPA or citizens may bring an enforcement action against CARB for 
violating its monitoring and reporting obligations.
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    \24\ The 2017 Carl Moyer Guidelines require that each contract 
issued to a grantee contain provisions to ensure compliance with 
Carl Moyer program requirements. See, e.g., 2017 Carl Moyer 
Guidelines, Volume I, Part 1, Chapter 3, Section V, para. 6(C) 
(requiring that each contract state that the project complies with 
Moyer Program requirements) and para. 11(C) (requiring that each 
contract inform grantee that CARB and the District may seek any 
remedies available under the law for noncompliance with Moyer 
Program requirements).
    \25\ 2017 Carl Moyer Guidelines, Volume I, Part 1, Chapter 3, 
Section AA (``Air District Audit of Projects''), para. 1.
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    We also disagree with Earthjustice's claim that the reference to 
``1300 repower and replacement projects'' in CARB's commitment is 
misleading as to what is actually required. As explained in Response 1, 
CARB is specifically obligated to monitor the District's implementation 
of at least 1,300 on-road heavy-duty compression ignition truck repower 
and replacement projects in accordance with specified portions of the 
2017 Carl Moyer Guidelines.\26\ The 2017 Carl Moyer Guidelines enable 
CARB to monitor the District's compliance with these guidelines by 
requiring, among other things, that air districts maintain compliance-
related documentation, make such documents available to CARB staff upon 
request, submit certified ``yearly reports'' to CARB containing 
specific information about funded projects, and allow CARB and its 
designees to inspect project engines, vehicles, and/or equipment and 
associated records during the contract term.\27\ The 2017 Carl Moyer 
Guidelines also specifically identify types of actions on the part of 
the implementing air district that CARB may treat as program violations 
and authorize CARB to enforce the terms of a project contract.\28\ If 
CARB fails to document in each annual demonstration report the steps it 
has taken to exercise these monitoring responsibilities, that failure 
would constitute a violation of the SIP commitment.
---------------------------------------------------------------------------

    \26\ South Coast Incentive Measure, para. 1.
    \27\ See footnotes 12-15, supra.
    \28\ See footnotes 16 and 17, supra.
---------------------------------------------------------------------------

    Additionally, as explained in Response 1, CARB is obligated to 
achieve 1 tpd of NOX emission reductions in the South Coast 
Air Basin, either through implementation of the identified truck 
repower and replacement projects or through substitute measures adopted 
and submitted in accordance with the deadlines specified in paragraph 5 
of the South Coast Incentive Measure.\29\ Thus, although CARB is not 
necessarily obligated to ensure that 1,300 incentive projects are 
implemented or to achieve 1 tpd of NOX emission reductions 
through these incentive projects, CARB is obligated to monitor at least 
1,300 such projects for purposes of determining whether those projects 
will achieve 1 tpd of NOX emission reductions by December 
31, 2022. If those projects do not fulfill the tonnage commitment, CARB 
is obligated to adopt and submit substitute measures sufficient to 
address the shortfall.\30\
---------------------------------------------------------------------------

    \29\ South Coast Incentive Measure, para. 2.
    \30\ Id.
---------------------------------------------------------------------------

    Comment 4: Earthjustice states that nothing in CARB's commitment to 
``achieve 1 ton per day of [NOX] emission reductions . . . 
by December 31, 2022'' specifies where these emission reductions must 
come from or where they must occur. Earthjustice claims that nothing 
specifies whether these reductions must be the result of some action by 
the agencies or merely the result of favorable economic conditions, and 
that CARB has relied on the latter in the past to claim compliance with 
similar ``commitments.'' Earthjustice further claims that there is no 
way for the EPA or citizens to look at the entire emissions inventory 
for the South Coast on December 31, 2022 and determine whether CARB has 
achieved this emission reduction, and that even if overall emissions 
increase between 2019 and 2022, CARB could still claim that but for 
some unspecified reason, the total NOX emissions would have 
been 1 tpd higher. Earthjustice argues that because there is no way to 
prove that CARB has not achieved the 1 tpd of NOX 
reductions, the commitment fails to define any possible violation and 
is not practicably enforceable.
    Response 4: We identify in Response 1 the types of violations of 
the commitments that could provide the basis for an enforcement action 
by the EPA or by citizens under section 113(a)(1) or 304(a)(1) of the 
CAA, respectively. As explained in Response 1, CARB's commitments 
constitute a specific enforceable strategy for achieving 1 tpd of 
NOX emission reductions on a fixed schedule and, upon 
approval into the SIP, become requirements of an ``applicable 
implementation plan'' as defined in CAA section 302(q). Accordingly, 
these commitments are enforceable by citizens under CAA section 
304(a)(1) and by the EPA under CAA section 113(a)(1).
    Earthjustice's characterization of CARB's commitments is incorrect 
in several respects. First, with respect to

[[Page 3825]]

CARB's commitment to achieve 1 tpd of NOX emission 
reductions by December 31, 2022, Earthjustice claims incorrectly that 
the commitments do not specify where these emission reductions must 
come from or where they must occur. The South Coast Incentive Measure 
specifies that CARB must achieve 1 tpd of NOX emission 
reductions through implementation of one or both of the following types 
of measures: (1) Heavy-duty compression-ignition truck repower and 
replacement projects implemented in accordance with specified portions 
of the 2017 Carl Moyer Guidelines, and/or (2) substitute measures and/
or rules adopted and submitted to the EPA by specified deadlines.\31\ 
It also makes clear that these emission reductions must occur in the 
South Coast Air Basin.\32\
---------------------------------------------------------------------------

    \31\ South Coast Incentive Measure, paras. 1, 2, and 5.
    \32\ Id. at para. 2 (requiring CARB to achieve NOX 
emission reductions ``from the 2023 baseline inventory, as detailed 
in the 2016 South Coast Air Quality Management Plan and discussed in 
the State SIP Strategy, through implementation of these projects or 
substitute measures for the [South Coast Air] Basin.''). The 2016 
South Coast Air Quality Management Plan (AQMP), relevant portions of 
the 2016 State Strategy and other related documents (hereafter 
``2016 South Coast Ozone SIP'') contain California's attainment 
demonstrations for the 1979 1-hour ozone NAAQS, the 1997 ozone NAAQS 
and the 2008 ozone NAAQS in the South Coast Air Basin. 84 FR 52005, 
52012-52013 (October 1, 2019).
---------------------------------------------------------------------------

    Second, Earthjustice claims incorrectly that nothing in the 
commitment ``specifies whether [the emission reductions] must be the 
result of some action by the agencies or merely the result of favorable 
economic conditions,'' and that CARB has relied on the latter in the 
past to claim compliance with similar ``commitments.'' As explained in 
Response 1, the South Coast Incentive Measure explicitly states that 
CARB will do the following:

    By December 31, 2022, achieve one ton per day of reductions in 
NOX emissions from the 2023 baseline inventory, as 
detailed in the 2016 South Coast Air Quality Management Plan and 
discussed in the State SIP Strategy, through implementation of these 
projects or substitute measures for the [South Coast Air] Basin; 
[and]
    If U.S. EPA determines by July 1, 2021, that information 
submitted by CARB is insufficient to demonstrate that emission 
reductions required under Paragraph 2 will occur on schedule, adopt 
and submit to U.S. EPA, no later than September 1, 2022, substitute 
measures and/or rules that will achieve emission reductions 
addressing the shortfall as expeditiously as practicable and no 
later than January 1, 2023.\33\
---------------------------------------------------------------------------

    \33\ South Coast Incentive Measure, paras. 2, 5.

    Thus, by its terms, the South Coast Incentive Measure obligates 
CARB to ``achieve'' 1 tpd of NOX emission reductions no 
later than January 1, 2023, either by confirming implementation of 
identified incentive projects in accordance with the specified portions 
of the 2017 Carl Moyer Guidelines or by adopting and submitting to the 
EPA substitute measures and/or rules that achieve equivalent emission 
reductions. In the interpretative statements preceding these 
commitments and in the Demonstration, CARB states that it is creating a 
``publicly-enforceable commitment to achieve emission reductions'' \34\ 
and confirms that ``CARB is the responsible party for enforcement of 
this measure and is responsible for achieving the emission reductions 
from this measure.'' \35\ Nowhere in the South Coast Incentive Measure 
or in CARB's interpretative statements does CARB indicate that 
favorable economic conditions may suffice to achieve the aggregate 
tonnage commitments.
---------------------------------------------------------------------------

    \34\ CARB Resolution 18-3, 4 (``Whereas, the South Coast 
Incentive Measure provides a publicly-enforceable commitment to 
achieve emission reductions'').
    \35\ Demonstration, 14.
---------------------------------------------------------------------------

    We note that in prior EPA actions approving aggregate tonnage 
commitments from CARB, the EPA has rejected claims that ``actual 
emission decreases'' resulting from an economic recession or other 
circumstances may count towards meeting the commitments and made clear 
that the only permissible means for achieving the required emission 
reductions is through notice-and-comment rulemaking procedures leading 
to the adoption and implementation of enforceable control measures.\36\
---------------------------------------------------------------------------

    \36\ See, e.g., 76 FR 69896, 69914-16 (November 9, 2011) 
(approving PM2.5 attainment demonstration for San Joaquin 
Valley).
---------------------------------------------------------------------------

    Third, Earthjustice suggests, incorrectly, that the EPA and 
citizens would have to look at the entire emissions inventory for the 
South Coast on December 31, 2022, to determine whether CARB has 
achieved 1 tpd of NOX emission reductions. For the reasons 
stated in this response and earlier in Response 1, it is not necessary 
to review an emissions inventory to determine whether CARB has achieved 
the required reductions. The South Coast Incentive Measure obligates 
CARB to provide, in each annual demonstration report submitted to the 
EPA from March 2020 through March 2023, detailed information about each 
incentive project that CARB is relying on to achieve the required 1 tpd 
of NOX emission reductions.\37\ Each of these annual 
demonstration reports must be readily available to the public on CARB's 
website or available upon request.\38\ If CARB's 2023 annual 
demonstration report (which is due March 31, 2023) fails to demonstrate 
that the identified projects have achieved 1 tpd of NOX 
emission reductions from the 2023 baseline inventory in the 2016 South 
Coast AQMP, citizens may sue CARB for violating its SIP commitment. The 
tonnage commitment remains enforceable even if the EPA has not made an 
insufficiency determination in accordance with paragraph 5 of the South 
Coast Incentive Measure. See Response 6 and Response 8 in the Response 
to Comments document.
---------------------------------------------------------------------------

    \37\ South Coast Incentive Measure, para. 3.
    \38\ Id. at para. 4.
---------------------------------------------------------------------------

    Additionally, if the EPA determines by July 1, 2021, that 
information submitted by CARB is insufficient to demonstrate that the 
emission reductions necessary to fulfill the 2023 tonnage commitment 
will occur on schedule, CARB must adopt and submit to the EPA, no later 
than September 1, 2022, substitute measures and/or rules that will 
achieve emission reductions addressing the shortfall as expeditiously 
as practicable and no later than January 1, 2023.\39\ Any such 
substitute control measure must be adopted following state rulemaking 
procedures through which the EPA and the public may track the State's 
progress in achieving the requisite emissions reductions. We expect 
CARB to make clear during any such rulemaking that it is proposing the 
identified measure or rule for purposes of submission to the EPA 
consistent with its commitment in the South Coast Incentive 
Measure.\40\ If, following an insufficiency finding by the EPA, CARB 
fails to adopt and submit substitute control measures that fully 
address the identified shortfall in required emission reductions by the 
relevant deadline, citizens may sue CARB for violating its SIP 
commitment.
---------------------------------------------------------------------------

    \39\ By its terms, the commitment is to ``adopt and submit to 
U.S. EPA. . . substitute measures and/or rules''--i.e., new or 
revised control measures subject to notice-and-comment rulemaking--
that achieve the necessary emission reductions, if the EPA makes an 
insufficiency finding. Id. at para. 5.
    \40\ See EPA, Memorandum dated November 22, 2011, from Janet 
McCabe, Deputy Assistant Administrator, EPA Office of Air and 
Radiation, to Air Division Directors, EPA Regions 1-10, Attachment B 
(``Guidelines to States Agencies for Preparing the Public Notices 
for State Implementation Plan (SIP) Revisions'') (noting that state 
public notices must state that the regulation or document at issue 
will be submitted to the EPA for approval into the SIP).
---------------------------------------------------------------------------

    For all of these reasons, we disagree with Earthjustice's claim 
that the South Coast Incentive Measure fails to define any possible 
violation and is not practicably enforceable.

[[Page 3826]]

III. Final Action

    No comments were submitted that change our assessment of the rule 
as described in our proposed action. Therefore, the EPA is fully 
approving this measure into the California SIP in accordance with 
section 110(k)(3) of the Act.
    In addition, the EPA is determining that CARB's adoption, 
implementation, and submission of the South Coast Incentive Measure 
satisfy the State's commitment in the 2016 South Coast Ozone SIP to 
bring to the Board for consideration an incentive-based measure for on-
road heavy-duty vehicles and achieves 1 tpd of CARB's aggregate 
NOX emission reduction commitment for 2023, as codified in 
40 CFR 52.220(c)(517)(ii)(A)(3).\41\
---------------------------------------------------------------------------

    \41\ 84 FR 52005, 52013-52014 (October 1, 2019) (referencing 
CARB Resolution 17-7 (March 23, 2017), Attachment A (``Proposed New 
SIP Measures and Schedule'')) and 84 FR 28132, 28149 (June 17, 2019) 
(Table 6, ``Defined Measures in the 2016 State Strategy--
Continued'').
---------------------------------------------------------------------------

    We are codifying this measure as additional material in the code of 
federal regulations (CFR), rather than through incorporation by 
reference, because, under its terms, the measure contains commitments 
enforceable only against CARB and because the measure is not a 
substantive rule of general applicability.

IV. Statutory and Executive Order Reviews

    Under the Clean Air Act, the Administrator is required to approve a 
SIP submission that complies with the provisions of the Act and 
applicable Federal regulations. 42 U.S.C. 7410(k); 40 CFR 52.02(a). 
Thus, in reviewing SIP submissions, the EPA's role is to approve state 
choices, provided that they meet the criteria of the Clean Air Act. 
Accordingly, this action merely approves state law as meeting Federal 
requirements and does not impose additional requirements beyond those 
imposed by state law. For that reason, this action:
     Is not a significant regulatory action subject to review 
by the Office of Management and Budget under Executive Orders 12866 (58 
FR 51735, October 4, 1993) and 13563 (76 FR 3821, January 21, 2011);
     Is not an Executive Order 13771 (82 FR 9339, February 2, 
2017) regulatory action because SIP approvals are exempted under 
Executive Order 12866;
     Does not impose an information collection burden under the 
provisions of the Paperwork Reduction Act (44 U.S.C. 3501 et seq.);
     Is certified as not having a significant economic impact 
on a substantial number of small entities under the Regulatory 
Flexibility Act (5 U.S.C. 601 et seq.);
     Does not contain any unfunded mandate or significantly or 
uniquely affect small governments, as described in the Unfunded 
Mandates Reform Act of 1995 (Pub. L. 104-4);
     Does not have federalism implications as specified in 
Executive Order 13132 (64 FR 43255, August 10, 1999);
     Is not an economically significant regulatory action based 
on health or safety risks subject to Executive Order 13045 (62 FR 
19885, April 23, 1997);
     Is not a significant regulatory action subject to 
Executive Order 13211 (66 FR 28355, May 22, 2001);
     Is not subject to requirements of Section 12(d) of the 
National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272 
note) because application of those requirements would be inconsistent 
with the Clean Air Act; and
     Does not provide the EPA with the discretionary authority 
to address, as appropriate, disproportionate human health or 
environmental effects, using practicable and legally permissible 
methods, under Executive Order 12898 (59 FR 7629, February 16, 1994).
    In addition, the SIP is not approved to apply on any Indian 
reservation land or in any other area where the EPA or an Indian tribe 
has demonstrated that a tribe has jurisdiction. In those areas of 
Indian country, the rule does not have tribal implications and will not 
impose substantial direct costs on tribal governments or preempt tribal 
law as specified by Executive Order 13175 (65 FR 67249, November 9, 
2000).
    The Congressional Review Act, 5 U.S.C. 801 et seq., as added by the 
Small Business Regulatory Enforcement Fairness Act of 1996, generally 
provides that before a rule may take effect, the agency promulgating 
the rule must submit a rule report, which includes a copy of the rule, 
to each House of the Congress and to the Comptroller General of the 
United States. The EPA will submit a report containing this action and 
other required information to the U.S. Senate, the U.S. House of 
Representatives, and the Comptroller General of the United States prior 
to publication of the rule in the Federal Register. A major rule cannot 
take effect until 60 days after it is published in the Federal 
Register. This action is not a ``major rule'' as defined by 5 U.S.C. 
804(2).
    Under section 307(b)(1) of the Clean Air Act, petitions for 
judicial review of this action must be filed in the United States Court 
of Appeals for the appropriate circuit by March 16, 2021. Filing a 
petition for reconsideration by the Administrator of this final rule 
does not affect the finality of this action for the purposes of 
judicial review nor does it extend the time within which a petition for 
judicial review may be filed, and shall not postpone the effectiveness 
of such rule or action. This action may not be challenged later in 
proceedings to enforce its requirements. (See section 307(b)(2).)

List of Subjects in 40 CFR Part 52

    Environmental protection, Air pollution control, Incorporation by 
reference, Intergovernmental relations, Ozone, Reporting and 
recordkeeping requirements, Volatile organic compounds.

    Dated: December 11, 2020.
John Busterud,
Regional Administrator, Region IX.

    Part 52, Chapter I, Title 40 of the Code of Federal Regulations is 
amended as follows:

PART 52--APPROVAL AND PROMULGATION OF IMPLEMENTATION PLANS

0
1. The authority citation for part 52 continues to read as follows:

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

Subpart F--CALIFORNIA

0
2. Section 52.220 is amended by adding paragraph (c)(550) to read as 
follows:


Sec.  52.220  Identification of plan-in part.

* * * * *
    (c) * * *
    (550) The following plan was submitted on May 4, 2018 by the 
Governor's designee.
    (i) [Reserved]
    (ii) Additional materials. (A) California Air Resources Board.
    (1) CARB Resolution 18-3, adopted March 22, 2018, as revised by 
Executive Order S-20-030, adopted November 23, 2020.
    (2) [Reserved]
    (B) [Reserved]

[FR Doc. 2020-28020 Filed 1-14-21; 8:45 am]
BILLING CODE 6560-50-P


