[Federal Register Volume 60, Number 8 (Thursday, January 12, 1995)]
[Proposed Rules]
[Pages 2917-2921]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-700]
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ENVIRONMENTAL PROTECTION AGENCY
40 CFR Part 70
[SD-001; FRL-5137-4]
Clean Air Act Proposed Interim Approval of Operating Permits
Program; State of South Dakota
AGENCY: Environmental Protection Agency (EPA).
ACTION: Proposed interim approval.
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SUMMARY: EPA proposes interim approval of the Operating Permits Program
submitted by the State of South Dakota for the purpose of complying
with Federal requirements for an approvable State program to issue
operating permits to all major stationary sources, and to certain other
sources.
DATES: Comments on this proposed action must be received in writing by
February 13, 1995.
ADDRESSES: Comments should be addressed to Laura Farris at the Region 8
address. Copies of the State's submittal and other supporting
information used in developing this proposed rule are available for
inspection during normal business hours at the following location: U.S.
Environmental Protection Agency, [[Page 2918]] Region 8, 999 18th
Street, suite 500, Denver, Colorado 80202.
FOR FURTHER INFORMATION CONTACT: Laura Farris, 8ART-AP, U.S.
Environmental Protection Agency, Region 8, Air Programs Branch, 999
18th Street, suite 500, Denver, Colorado 80202, (303) 294-7539.
SUPPLEMENTARY INFORMATION:
I. Background and Purpose
A. Introduction
As required under title V of the 1990 Clean Air Act Amendments
(sections 501-507 of the Clean Air Act (``the Act'')), EPA has
promulgated rules which define the minimum elements of an approvable
State operating permits program and the corresponding standards and
procedures by which the EPA will approve, oversee, and withdraw
approval of State operating permits programs (see 57 FR 32250 (July 21,
1992)). These rules are codified at 40 CFR part 70. Title V requires
States to develop, and submit to EPA, programs for issuing these
operating permits to all major stationary sources and to certain other
sources.
The Act requires that States develop and submit these programs to
EPA by November 15, 1993, and that EPA act to approve or disapprove
each program within 1 year after receiving the submittal. Based on
material changes to the State's submission that consisted of
regulations changes adopted by the State on November 17, 1994, EPA is
extending the review period for an additional 3 months. EPA will act to
approve or disapprove the submission by April 11, 1995. EPA's program
review occurs pursuant to section 502 of the Act and the part 70
regulations, which together outline criteria for approval or
disapproval. Where a program substantially, but not fully, meets the
requirements of part 70, EPA may grant the program interim approval for
a period of up to 2 years. If EPA has not fully approved a program by 2
years after the November 15, 1993 date, or by the end of an interim
program, it must establish and implement a Federal program.
B. Federal Oversight and Sanctions
If EPA were to finalize this proposed interim approval, it would
extend for two years following the effective date of final interim
approval, and could not be renewed. During the interim approval period,
the State would be protected from sanctions, and EPA would not be
obligated to promulgate, administer and enforce a Federal permits
program for the State. Permits issued under a program with interim
approval have full standing with respect to part 70, and the 1-year
time period for submittal of permit applications by subject sources
begins upon the effective date of interim approval, as does the 3-year
time period for processing the initial permit applications.
Following final interim approval, if the State failed to submit a
complete corrective program for full approval by the date 6 months
before expiration of the interim approval, EPA would start an 18-month
clock for mandatory sanctions. If the State then failed to submit a
corrective program that EPA found complete before the expiration of
that 18-month period, EPA would apply sanctions as required by section
502(d)(2) of the Act, which would remain in effect until EPA determined
that the State had corrected the deficiency by submitting a complete
corrective program.
If, following final interim approval, EPA were to disapprove the
State's complete corrective program, EPA would be required under
section 502(d)(2) to apply sanctions on the date 18 months after the
effective date of the disapproval, unless prior to that date the State
had submitted a revised program and EPA had determined that it
corrected the deficiencies that prompted the disapproval.
In addition, discretionary sanctions may be applied where warranted
any time after the end of an interim approval period if a State has not
timely submitted a complete corrective program or EPA has disapproved a
submitted corrective program. Moreover, if EPA has not granted full
approval to a State program by the expiration of an interim approval
and that expiration occurs after November 15, 1995, EPA must
promulgate, administer and enforce a Federal permits program for that
State upon interim approval expiration.
II. Proposed Action and Implications
A. Analysis of State Submission
1. Support Materials
The Governor of South Dakota's designee, Robert E. Roberts,
Secretary of the Department of Environment and Natural Resources,
submitted the State of South Dakota Title V Operating Permit Program
(PROGRAM) to EPA on November 12, 1993. Amendments to the PROGRAM
requested by EPA were received on January 11, 1994. EPA deemed the
PROGRAM administratively and technically complete in a letter to the
Governor's designee dated January 14, 1994. The PROGRAM submittal
includes a legal opinion from the Attorney General of South Dakota
stating that the laws of the State provide adequate legal authority to
carry out all aspects of the PROGRAM, and a description of how the
State intends to implement the PROGRAM. The submittal additionally
contains evidence of proper adoption of the PROGRAM regulations, a
permit fee demonstration and a memorandum of agreement which defines
how the PROGRAM will be administered by the State and reviewed by EPA.
2. Regulations and Program Implementation
The South Dakota PROGRAM, including the operating permit regulation
(Administrative Rules of South Dakota (ARSD), Article 74:36, Air
Pollution Control Program), substantially meets the requirements of 40
CFR 70.2 and 70.3 with respect to applicability; Secs. 70.4, 70.5, and
70.6 with respect to permit content including operational flexibility;
Sec. 70.5 with respect to complete application forms (no insignificant
activities were identified in the PROGRAM); Sec. 70.7 with respect to
public participation and minor permit modifications; and Sec. 70.11
with respect to requirements for enforcement authority.
South Dakota has the authority to issue variances from requirements
imposed by State law. Section 34A-1-24 of the South Dakota Codified
Laws (SDCL) allows the Board of Minerals and Environment, the
permitting board, discretion to grant relief from compliance with State
rules and regulations governing the quality, nature, duration or extent
of emissions. Succeeding sections of the SDCL specify under what
circumstances a variance may be granted or denied. In its review of
South Dakota's PROGRAM, EPA has previously taken the position that, in
order to gain full approval for its PROGRAM, South Dakota would have to
amend SDCL 34A-1-24 to make it clear that variances may not be granted
to part 70 sources. EPA has reevaluated its position on this issue.
Although EPA would support such an amendment to SDCL 34A-1-24, EPA has
not required other states to change similar statutory variance
provisions. Thus, EPA believes it would not be appropriate to require
South Dakota to amend SDCL 34A-1-24 before full PROGRAM approval is
granted. EPA's reasoning is as follows: EPA regards SDCL 34A-1-24 as
wholly external to the PROGRAM submitted for approval under part 70,
and consequently is proposing to take no action on this provision of
State law. EPA has no authority to approve provisions of State law,
such as the variance provision referred to, which [[Page 2919]] are
inconsistent with part 70. EPA does not recognize the ability of a
permitting authority to grant relief from the duty to comply with a
Federally enforceable part 70 permit, except where such relief is
granted through procedures allowed by part 70. EPA reserves the right
to enforce the terms of the part 70 permit where the permitting
authority purports to grant relief from the duty to comply with a part
70 permit in a manner inconsistent with part 70 procedures.
Part 70 of the operating permit regulations requires prompt
reporting of deviations from the permit requirements. Section
70.6(a)(3)(iii)(B) requires the permitting authority to define prompt
in relation to the degree and type of deviation likely to occur and the
applicable requirements. Although the permit program regulations should
define prompt for purposes of administrative efficiency and clarity, an
acceptable alternative is to define prompt in each individual permit.
The EPA believes that prompt should generally be defined as requiring
reporting within two to ten days of the deviation. Two to ten days is
sufficient time in most cases to protect public health and safety as
well as to provide a forewarning of potential problems. For sources
with a low level of excess emissions, a longer time period may be
acceptable. However, prompt reporting must be more frequent than the
semiannual reporting requirement, given this is a distinct reporting
obligation under Sec. 70.6(a)(3)(iii)(A). Where ``prompt'' is defined
in the individual permit but not in the program regulations, EPA may
veto permits that do not contain sufficiently prompt reporting of
deviations. The South Dakota PROGRAM will define prompt reporting of
deviations in each permit consistent with the applicable requirements.
There are certain provisions of South Dakota's operating permit
regulation for which EPA feels it is appropriate to offer clarification
to ensure that they are interpreted to be consistent with part 70.
These are as follows: (1) The definition of ``federally enforceable''
which appears at ARSD 74:36:01:01(28) reads as follows:
``Federally enforceable,'' all limits and conditions that are
enforceable by the administrator of EPA pursuant to federal law.
These limits and conditions include those requirements developed
pursuant to this article, those appearing in 40 CFR 60 and 61 (July
1, 1993), requirements within the state implementation plan and
permit requirements established pursuant to this article or 40 CFR
51 Subpart I (July 1, 1993). The use of this term does not impede
the Department's authority under state law to enforce these limits
and conditions.
This definition could be significant for determining whether a
source is subject to the part 70 PROGRAM. Thus, the second sentence of
the above definition cannot and should not be read to expand on the
first sentence of the definition. For example, requirements developed
pursuant to ARSD Article 74:36 might be, but wouldn't necessarily be,
Federally enforceable. EPA's interpretation is that the requirements
delineated in the second sentence of the definition are only Federally
enforceable if they are enforceable by the administrator of EPA
pursuant to federal law.
(2) The second sentence of ARSD 74:36:01:08(1) reads as follows:
Emissions from any oil exploration or production well and its
associated equipment and emissions from any pipeline compressor or pump
station may not be aggregated with emissions from other similar units,
whether or not such units are in a contiguous area or under common
control, to determine whether such units or stations are major sources.
To be consistent with part 70, this sentence must be read as only
being applicable to a determination of whether a source is major under
section 112 of the Act. This language cannot be applied when
determining whether a source is major under other sections of the Act.
Comments noting deficiencies in the South Dakota PROGRAM were sent
to the State in a letter dated July 8, 1994. The deficiencies were
segregated into those that require corrective action prior to interim
PROGRAM approval, and those that require corrective action prior to
full PROGRAM approval. In a letter dated August 18, 1994, the State
committed to complete the regulatory process to correct both interim
and full PROGRAM approval deficiencies related to its PROGRAM
regulations, and submit these changes to EPA by approximately December
15, 1994. EPA responded in a letter dated October 3, 1994 that they
would review all of the State's corrective actions. However, these
corrective actions would be considered a material change to the PROGRAM
and the date for final interim approval would be extended. The State
adopted the regulatory changes on November 17, 1994, which EPA has
reviewed and has determined to be adequate to allow for interim
approval.
One remaining issue noted in EPA's July 8, 1994 letter that require
corrective action prior to full PROGRAM approval is as follows: The
PROGRAM submittal contained an Attorney General's opinion which stated
that South Dakota's criminal enforcement authorities are not equivalent
to those required in part 70.11. The State's criminal enforcement
statute only allows for a maximum penalty of $1,000 for failure to
obtain a permit and $500 for violation of a permit condition. The State
must adopt legislation consistent with Sec. 70.11 prior to receiving
full PROGRAM approval to allow for a maximum criminal fine of not less
than $10,000 per day per violation for knowing violation of operating
permit requirements, including making a false statement and tampering
with a monitoring device.
Refer to the technical support document accompanying this
rulemaking for a detailed explanation of each comment and the
corrective actions required of the State.
3. Permit Fee Demonstration
The State of South Dakota established an initial fee for regulated
air pollutants below the presumptive minimum set in title V, section
502 and part 70, and was required to submit a detailed permit fee
demonstration as part of its PROGRAM submittal. The basis of this fee
demonstration included a workload analysis, which estimated the annual
cost of running the PROGRAM in fiscal year (FY) 1995 to be $438,215; a
fee structure based on the estimated direct and indirect costs of the
PROGRAM, the number of part 70 sources permitted, and the actual
emissions for the previous year. The fees established for FY 1995 are
as follows: rock crushers will be charged a flat fee of $250.00; an
annual administrative fee will be assessed to all major sources (based
on actual emissions of each source for one calendar year), excluding
rock crushers, consisting of $100.00 for sources emitting less than 50
tons per year, $500.00 for sources emitting 50 to less than 100 tons
per year, and $1,000.00 for sources emitting 100 tons per year or
greater; and an air emission fee will be assessed to all major sources
(excluding rock crushers) of $6.10 per ton per year based on emissions
from calendar year 1992 (the State will not use the 4,000 tons per year
per pollutant emissions cap allowed by Act). This fee structure will be
reevaluated each year. After careful review, the State of South Dakota
has determined that these fees would support the South Dakota PROGRAM
costs as required by 40 CFR 70.9(a).
4. Provisions Implementing the Requirements of Other Titles of the Act
a. Authority and/or commitments for section 112 implementation
South Dakota has demonstrated in its [[Page 2920]] PROGRAM submittal
adequate legal authority to implement and enforce all section 112
requirements through the title V permit. This legal authority is
contained in South Dakota's enabling legislation and in regulatory
provisions defining ``applicable requirements'' and stating that the
permit must incorporate all applicable requirements. EPA has determined
that this legal authority is sufficient to allow South Dakota to issue
permits that assure compliance with all section 112 requirements. EPA
is interpreting the above legal authority to mean that South Dakota is
able to carry out all section 112 activities. For further rationale on
this interpretation, please refer to the Technical Support Document
accompanying this rulemaking and the April 13, 1993 guidance memorandum
titled ``Title V Program Approval Criteria for Section 112
Activities,'' signed by John Seitz.
b. Implementation of 112(g) upon program approval. As a condition
of approval of the part 70 PROGRAM, South Dakota is required to
implement section 112(g) of the Act from the effective date of the part
70 PROGRAM. Imposition of case-by-case determinations of maximum
achievable control technology (MACT) or offsets under section 112(g)
will require the use of a mechanism for establishing Federally
enforceable restrictions on a source-specific basis. The EPA is
proposing to approve South Dakota's combined preconstruction/operating
permit program found in section 74:36:05 of the State's regulations
under the authority of title V and part 70 for the purpose of
implementing section 112(g) during the transition period between title
V approval and adoption of a State rule implementing EPA's section
112(g) regulations. South Dakota has combined their preconstruction
permitting regulations and their part 70 permitting regulations for all
new part 70 sources, except those sources subject to prevention of
significant deterioration (PSD) or nonattainment new source review
(NSR) permitting. South Dakota will require sources subject to section
112(g) to obtain a title V permit prior to construction, thereby
creating a Federally enforceable limit. EPA believes this approval is
necessary so that South Dakota has a mechanism in place to establish
Federally enforceable restrictions for section 112(g) purposes from the
date of part 70 approval. Section 112(l) provides statutory authority
for approval for the use of State air programs to implement section
112(g), and title V and section 112(g) provide authority for this
limited approval because of the direct linkage between implementation
of section 112(g) and title V. If South Dakota does not wish to
implement section 112(g) through these authorities and can demonstrate
that an alternative means of implementing section 112(g) exists, EPA
may, in the final action approving South Dakota's PROGRAM, approve the
alternative instead. To the extent South Dakota does not have the
authority to regulate HAPs through existing State law, the State may
disallow modifications during the transition period.
This approval is for an interim period only, until such time as the
State is able to adopt regulations consistent with any regulations
promulgated by EPA to implement section 112(g). Accordingly, EPA is
proposing to limit the duration of this approval to a reasonable time
following promulgation of section 112(g) regulations so that South
Dakota, acting expeditiously, will be able to adopt regulations
consistent with the section 112(g) regulations. EPA is proposing here
to limit the duration of this approval to 12 months following
promulgation by EPA of section 112(g) regulations. Comment is solicited
on whether 12 months is an appropriate period considering South
Dakota's procedures for adoption of Federal regulations.
c. Program for straight delegation of section 112 standards.
Requirements for approval, specified in 40 CFR 70.4(b), encompass
section 112(l)(5) requirements for approval of a program for delegation
of section 112 General Provisions Subpart A and standards as
promulgated by EPA as they apply to part 70 sources. Section 112(l)(5)
requires that the State's program contain adequate authorities,
adequate resources for implementation, and an expeditious compliance
schedule, which are also requirements under part 70. Therefore, EPA is
also proposing to grant approval under section 112(l)(5) and 40 CFR
Part 63.91 of the State's program for receiving delegation of section
112 standards that are unchanged from the Federal standards as
promulgated. South Dakota has informed EPA that it intends to accept
delegation of section 112 standards through incorporation by reference.
This program applies to both existing and future standards but is
limited to sources covered by the part 70 program.
The radionuclide national emission standard for HAPs (NESHAP) is a
section 112 regulation and an applicable requirement under the State
PROGRAM. Currently the State of South Dakota has no part 70 sources
which emit radionuclides. However, sources which are not currently part
70 sources may be defined as major and become part 70 sources under
forthcoming Federal radionuclide regulations. In that event, the State
will be responsible for issuing part 70 permits to those sources.
d. Program for implementing title IV of the act. South Dakota's
PROGRAM contains adequate authority to issue permits which reflect the
requirements of Title IV of the Act, and commits to adopt the rules and
requirements promulgated by EPA to implement an acid rain program
through the title V permit.
B. Proposed Action
EPA is proposing to grant interim approval to the operating permits
program submitted by the State of South Dakota on November 12, 1993. If
promulgated, the State must make the following change, as discussed in
detail above, to receive full PROGRAM approval: The State must adopt
legislation consistent with Sec. 70.11 prior to receiving full PROGRAM
approval to allow for a maximum criminal fine of not less than $10,000
per day per violation for knowing violation of operating permit
requirements, including making a false statement and tampering with a
monitoring device.
Evidence of this statutory change must be submitted to EPA within
18 months of EPA's interim approval of the South Dakota PROGRAM.
Today's proposal to give interim approval to the State's part 70
PROGRAM does not extend to ``Indian Country,'' as defined in 18 U.S.C.
1151, including the following ``existing or former'' Indian
reservations in the State: 1. Cheyenne River; 2. Crow Creek; 3.
Flandreau; 4. Lower Brule; 5. Pine Ridge; 6. Rosebud; 7. Sisseton; 8.
Standing Rock; and 9. Yankton.
The State has asserted it has jurisdiction to enforce a part 70
PROGRAM within some or all of these ``existing or former'' Indian
reservations and has provided an analysis of such jurisdiction. EPA is
in the process of evaluating the State's analysis and will issue a
supplemental notice regarding this issue in the future. Before EPA
would approve the State's part 70 PROGRAM for any portion of ``Indian
Country,'' EPA would have to be satisfied that the State has authority,
either pursuant to explicit Congressional authorization or applicable
principles of Federal Indian law, to enforce its laws against existing
and potential pollution sources within any geographical area for which
it seeks program approval and that such approval would constitute sound
administrative practice. This is a complex and controversial issue, and
[[Page 2921]] EPA does not wish to delay interim approval of the
State's part 70 PROGRAM with respect to undisputed sources while EPA
resolves this question.
In deferring final action on program approval for sources located
in ``Indian Country,'' EPA is not making a determination that the State
either has adequate jurisdiction or lacks such jurisdiction. Instead,
EPA is deferring judgment regarding this issue pending EPA's evaluation
of the State's analysis.
This interim approval, which may not be renewed, extends for a
period of up to two years. During the interim approval period, the
State is protected from sanctions for failure to have a program, and
EPA is not obligated to promulgate a Federal permits program in the
State. Permits issued under a program with interim approval have full
standing with respect to part 70, and the one-year time period for
submittal of permit applications by subject sources begins upon interim
approval, as does the three-year time period for processing the initial
permit applications.
Requirements for approval, specified in 40 CFR 70.4(b), encompass
section 112(l)(5) requirements for approval of a program for delegation
of section 112 standards as promulgated by EPA as they apply to part 70
sources. Section 112(l)(5) requires that the State's program contain
adequate authorities, adequate resources for implementation, and an
expeditious compliance schedule, which are also requirements under part
70. Therefore, EPA is also proposing to grant approval under section
112(l)(5) and 40 CFR 63.91 of the State's program for receiving
delegation of section 112 standards that are unchanged from Federal
standards as promulgated. This program for delegations only applies to
sources covered by the part 70 program.
III. Administrative Requirements
A. Request for Public Comments
The EPA is requesting comments on all aspects of this proposed
interim approval. Copies of the State's submittal and other information
relied upon for the proposed interim approval are contained in a docket
maintained at the EPA Regional Office. The docket is an organized and
complete file of all the information submitted to, or otherwise
considered by, EPA in the development of this proposed interim
approval. The principal purposes of the docket are:
(1) to allow interested parties a means to identify and locate
documents so that they can effectively participate in the approval
process, and
(2) to serve as the record in case of judicial review. The EPA will
consider any comments received by February 13, 1995.
B. Executive Order 12866
The Office of Management and Budget has exempted this action from
Executive Order 12866 review.
C. Regulatory Flexibility Act
EPA's actions under section 502 of the Act do not create any new
requirements, but simply address operating permits programs submitted
to satisfy the requirements of 40 CFR part 70. Because this action does
not impose any new requirements, it does not have a significant impact
on a substantial number of small entities.
List of Subjects in 40 CFR Part 70
Environmental protection, Administrative practice and procedure,
Air pollution control, Intergovernmental relations, Operating permits,
Reporting and recordkeeping requirements.
Authority: 42 U.S.C. 7401-7671q.
Dated: December 29, 1994.
Jack W. McGraw,
Acting Regional Administrator.
[FR Doc. 95-700 Filed 1-11-95; 8:45 am]
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