01-18411. Revision to the California State Implementation Plan, Bay Area Air Quality Management District, Lake County Air Quality Management District, Monterey Bay Unified Air Pollution Control District, Sacramento Metropolitan Air Quality ...

AGENCY:

Environmental Protection Agency (EPA).

ACTION:

Final rule.

SUMMARY:

EPA is finalizing a limited approval and limited disapproval of a revision to the Bay Area Air Quality Management District (BAAQMD), Lake County Air Quality Management District (LCAQMD), Monterey Bay Unified Air Pollution Control District (MBUAPCD), Sacramento Metropolitan Air Quality Management District (SMAQMD), and San Joaquin Valley Unified Air Pollution Control District (SJVUAPCD) portions of the California State Implementation Plan (SIP). This action was proposed in the Federal Register on November 14, 2000 and concerns volatile organic compound (VOC) emissions from the transfer of gasoline at gasoline dispensing stations. Under authority of the Clean Air Act as amended in 1990 (CAA or the Act), this action directs California to correct rule deficiencies.

EFFECTIVE DATE:

This rule is effective on August 24, 2001.

ADDRESSES:

You can inspect copies of the administrative record for this action at EPA's Region IX office during normal business hours. You can inspect copies of the submitted rule revisions at the following locations:

Environmental Protection Agency, Region IX, 75 Hawthorne Street, San Francisco, CA 94105

Environmental Protection Agency, Air Docket (6102), Ariel Rios Building, 1200 Pennsylvania Avenue, NW., Washington DC 20460

California Air Resources Board, Stationary Source Division, Rule Evaluation Section, 1001 “I” Street, Sacramento, CA 95814

Bay Area Air Quality Management District, 939 Ellis Street, San Francisco, CA 94105

Lake County Air Quality Management District, 883 Lakeport Boulevard, Lakeport, CA 95453

Monterey Bay Unified Air Pollution Control District, 24580 Silver Cloud Court, Monterey, CA 93940

Sacramento Metropolitan Air Quality Management District, 8411 Jackson Road, Sacramento, CA 95826

San Joaquin Valley Unified Air Pollution Control District, 1990 East Gettysburg Street, Fresno, CA 93726

FOR FURTHER INFORMATION CONTACT:

Al Petersen, Rulemaking Office (AIR-4), U.S. Environmental Protection Agency, Region IX; [phone].

SUPPLEMENTARY INFORMATION:

Throughout this document, “we,” “us” and “our” refer to EPA.

I. Proposed Action

On November 14, 2000 (65 FR 68114), EPA proposed a limited approval and limited disapproval of the rules in Table 1 that were submitted for incorporation into the California SIP.

Table 1.—Submitted Rules'

Local agency	Rule no.	Rule Title	Adopted	Submitted
BAAQMD	8-7	Gasoline Dispensing Facilities	11/17/99	3/28/00
LCAQMD	439.5	Retail Gasoline Service Stations	07/15/97	05/18/98
MBUAPCD	1002	Transfer of Gasoline into Vehicle Fuel Tanks	04/21/99	06/03/99
SMAQMD	449	Transfer of Gasoline into Vehicle Fuel Tanks	04/03/97	05/18/98
SJVUAPCD	4622	Gasoline Transfer into Vehicle Fuel Tanks	06/18/98	08/21/98

We proposed a limited approval because we determined that these rules improve the SIP and are largely consistent with the relevant CAA requirements. We simultaneously proposed a limited disapproval because some rule provisions conflict with section 110 and part D of the Act. Our proposed action contains more information on the rules and our evaluation.

II. Public Comments and EPA Responses

EPA's proposed action provided a 30-day public comment period. During this period, we received comments from the following parties:

• Peter Hess, BAAQMD; letter dated December 12, 2000 and received on December 14, 2000.
• Scott Nester, SJVUAPCD; letter dated December 8, 2000 and received on December 11, 2000.

The BAAQMD comments and our responses are summarized below.

Comment I: BAAQMD disagrees that it is appropriate to cite the California Code of Regulations (CCR), title 17, section 94006, instead of Calfornia Health and Safety Code (CH&SC) 41960.2(c), as a reference for a list of vapor recovery system defects that substantially impair the effectiveness of the system. BAAQMD notes that CCR, title 17, section 94006 has not been revised since 1981 but that CH&SC 41960.2 was revised in the year 2000 by Assembly Bill 1164 to include the requirement that substantial defects “shall be specified in the applicable certification documents for each system.” It is likely that some new defects will be listed only in California Air Resources Board (CARB) Executive Orders (EO) for certifications. BAAQMD states that it is unclear whether CARB will update the CCR, title 17, section 94006 list, and that this situation presents an enforceability problem for the District. If Rule 8-7 cites only the CCR and the CCR list is not revised, the District would not have the authority to require that operators remedy new system defects that are not in the CCR list. BAAQMD states that all substantial defects would be subject to the rule by referencing CH&SC 41960.2(c).

Response: Enforceability is also a concern for EPA. We require for clarity and for federal enforceability that the system defects that substantially impair the effectiveness of the system be listed or referenced in a readily-available public document. Two alternate ways to handle the enforceability problem are as follows:

• List all substantial system defects to be remedied in Rule 8-7.
• Reference both CCR, title 17, section 94006, and CH&SC 41960.2(c). We note that CARB is currently updating the CCR list as required by CH&SC 41960.2.

Comment II: BAAQMD disagrees with including specific testing requirements in Rule 8-7. There are over 100 CARB-certified vapor recovery systems, for which stating individual testing requirements would be unwieldy. BAAQMD also disagrees with specifying a specific time period for reverification of performance tests. Some relatively reliable systems may be tested too often, thereby unnecessarily increasing gasoline emissions during the test procedure. Other unreliable systems may not be tested often enough, thereby allowing an increase of emissions during normal operation.

BAAQMD believes that an arbitrary testing frequency may impose a financial hardship on businesses that have chosen a more reliable system.

BAAQMD states that there is no data to justify testing as infrequently as every other year for all stations with In-Station Diagnostics.

BAAQMD suggests that having testing and notification requirements in the Authority to Construct and the Permit to Operate is a practical way to incorporate the individual requirements that apply to specific systems and allow the District flexibility to address problems in certain systems.

Response: EPA concurs that specifying one testing frequency for all equipment may not be necessary or efficient. However, we believe that BAAQMD's comment supports our conclusion that reverification testing every five years or longer is inadequate. While we understand that it is not current practice to allow such an extended time for reverification testing in the BAAQMD, the current text of Rule 8-7 would not prevent it in all cases. Rule 8-7 should be revised, therefore, to require more frequent regular reverification. In general, we believe that six to twelve months is an appropriate reverification frequency. If the District wishes to maintain flexibility to change reverification frequency, the rule should specify the criteria that would be used in exercising this flexibility.

We note that the South Coast Air Quality Management District has estimated that reverification testing every six months costs about $0.0012 per gallon of gasoline dispensed. This does not appear to be an unreasonable financial burden.

We also note that the suggestion of having testing and notification requirements only in the Permit to Operate has not in the past resulted in a satisfactory testing frequency in Districts with rule language similar to BAAQMD's.

The SJVUAPCD comments and our responses are summarized below.

Comment I: SJVUAPCD has concurred with EPA's recommendations regarding four improvements to Rule 4922 as follows:

• Correction of the CCR reference for CARB certification procedures to CCR, title 17, section 94011.
• Addition of a requirement to keep maintenance records and reverification test records for two years.
• Revision of the requirement that new vapor recovery equipment be tested at least within the number of days required by the SIP rule.
• Stating the specific EPA-approved test method(s) to be used for air-to-liquid volume ratio.

Comment II: SJVUAPCD believes that reverification of Dyamic Back-Pressure Test and Static Leak Test annually is adequate and is consistent with the California Air Pollution Control Officers' Association Vapor Recovery Committee's recommendations to improve the performance of existing systems. The reverification of Air-to-Liquid Ratio would be done every six months, because this is currently required by Operating Permits. The District agrees that, if In-Station Diagnostics are used, the above reverification tests should be done every two years.

However, SJVUAPCD believes that reverification of Liquid Removal Rate should only be done if there is an indication of pressure fluctuation during the Dynamic Back Pressure Test or if fuel drains from the dispensing nozzle when the vapor check valve is opened. The absence of both of these observations is a good indication that the liquid removal system is functioning properly, and therefore a specific testing frequency would not be appropriate. District staff intends to include this procedure in the rule as a method of determining whether the Liquid Removal Rate Test needs to be conducted in conjunction with the Dynamic Back-Pressure Test and Static Leak Test.

Response: The reverification test frequencies suggested are within the range of EPA recommendations. It should be noted that In-Station Diagnostics is a relatively new technology for use in gasoline dispensing facilities. Recommending a lesser frequency of testing at this time may be appropriate to encourage its use. But subsequent experience with its use could show that the recommended frequency should be adjusted.

Assuming adequate support in the District Staff Report, the District could waive the reverification of the Liquid Removal Rate Test, if the District specifies in the rule the procedure for determining where it could be waived.

See Response to BAAQMD Comment II for additional comments regarding flexibility of reverification test frequencies.

III. EPA Action

Comments submitted by the BAAQMD and SJVUAPCD changed our recommendations on how to revise the rules but did not change our proposed action on the rules. Therefore, as authorized in sections 110(k)(3) and 301(a) of the CAA, EPA is finalizing a limited approval of the submitted rules. This action incorporates the submitted rules into the California SIP, including those provisions identified as deficient. As authorized under section 110(k)(3), EPA is simultaneously finalizing a limited disapproval of the submitted rules. As a result, sanctions will be imposed on the BAAQMD, SMAQMD, and SJVUAPCD unless EPA approves subsequent SIP revisions that correct the rule deficiencies within 18 months of the effective date of this action. These sanctions will be imposed under section 179 of the CAA as described in 59 FR 39832 (August 4, 1994). In addition, EPA must promulgate a federal implementation plan (FIP) under section 110(c) unless we approve subsequent SIP revisions that correct the rule deficiencies within 24 months. Sanctions will not be imposed on LCAQMD and MBUAPCD, because they are an ozone attainment area and maintenance attainment area, respectively. Note that the submitted rules have been adopted by BAAQMD, LCAQMD, MBUAPCD, SMAQMD, and SJVUAPCD, and EPA's final limited disapproval does not prevent the local agency from enforcing them.

IV. Administrative Requirements

A. Executive Order 12866

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

B. Executive Order 13045

Executive Order 13045, entitled Protection of Children from Environmental Health Risks and Safety Risks (62 FR 19885, April 23, 1997), applies to any rule that: (1) Is determined to be “economically significant” as defined under E.O. 12866, and (2) concerns an environmental health or safety risk that EPA has reason to believe may have a disproportionate effect on children. If the regulatory action meets both criteria, the Agency must evaluate the environmental health or safety effects of the planned rule on children, and explain why the planned regulation is preferable to other potentially effective and reasonably feasible alternatives considered by the Agency.

This rule is not subject to E.O. 13045 because it does not involve decisions intended to mitigate environmental health or safety risks.

C. Executive Order 13132

Executive Order 13132, entitled Federalism (64 FR 43255, August 10, 1999) revokes and replaces Executive Orders 12612, Federalism and 12875, Enhancing the Intergovernmental Partnership. E.O. 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 E.O. 13132, EPA may not issue a regulation that has federalism implications, that imposes substantial direct compliance costs, and that is not 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 E.O. 13132, because it merely acts on 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.

D. Executive Order 13175

Executive Order 13175, entitled “Consultation and Coordination with Indian Tribal Governments” (65 FR 67249, November 6, 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.” “Policies that have tribal implications” is defined in the Executive Order to include regulations that have “substantial direct effects on one or more Indian tribes, on the relationship between the Federal government and the Indian tribes, or on the distribution of power and responsibilities between the Federal government and Indian tribes.”

This final rule does not have tribal implications. 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, as specified in Executive Order 13175. Thus, Executive Order 13175 does not apply to this rule.

E. 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 final 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 act on 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.

EPA's disapproval of the state request under section 110 and subchapter I, part D of the Clean Air Act does not affect any existing requirements applicable to small entities. Any pre-existing federal requirements remain in place after this disapproval. Federal disapproval of the state submittal does not affect state enforceability. Moreover, EPA's disapproval of the submittal does not impose any new Federal requirements. Therefore, 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).

F. Unfunded Mandates

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 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 promulgated 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 acts on 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.

G. 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.

EPA believes that VCS are inapplicable to today's action because it does not require the public to perform activities conducive to the use of VCS.

H. Submission to Congress and the Comptroller General

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. EPA will submit a report containing this rule 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 rule is not a “major” rule as defined by 5 U.S.C. 804(2).

I. Petitions for Judicial Review

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 September 24, 2001. Filing a petition for reconsideration by the Administrator of this final rule does not affect the finality of this rule 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: June 8, 2001.

Keith Takata,

Acting Regional Administrator, Region IX.

Part 52, chapter I, title 40 of the Code of Federal Regulations is amended as follows:

PART 52—[AMENDED]

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

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

Subpart F—California

2. Section 52.220 is amended by adding paragraphs (c)(255)(i)(A)( 5), (c)(255)(i)(D)(2), (c)(264)(i)(D)(1), (c)(273)(i)(A)(2), and (c)(277)(i)(C)(6) to read as follows:

§ 52.220

Identification of plan.

* * * * *

(c) * * *

(255) * * *

(i) * * *

(A) * * *

(5) Rule 449, adopted on April 3, 1997.

(D) * * *

(2) Section (Rule) 439.5, adopted on July 15, 1997.

* * * * *

(264) * * *

(i) * * *

(D) Monterey Bay Unified Air Pollution Control District.

(1) Rule 1002, adopted on April 21, 1999.

* * * * *

(273) * * *

(i) * * *

(A) * * *

(2) Rule 4622, adopted on June 18, 1998.

* * * * *

(277) * * *

(i) * * *

(C) * * *

(6) Rule 8-7, adopted on November 17, 1999.

* * * * *