[Federal Register Volume 60, Number 194 (Friday, October 6, 1995)]
[Rules and Regulations]
[Pages 52332-52336]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-24453]
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ENVIRONMENTAL PROTECTION AGENCY
40 CFR Part 70
[AD-FRL-5307-9]
Clean Air Act Final Interim Approval of Operating Permits
Program; Monterey Bay Unified Air Pollution Control District,
California
AGENCY: Environmental Protection Agency (EPA).
ACTION: Final interim approval.
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SUMMARY: The EPA is promulgating interim approval of the Operating
Permits Program submitted by the Monterey Bay Unified Air Pollution
Control District (Monterey or District) 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.
EFFECTIVE DATE: November 6, 1995.
ADDRESSES: Copies of Monterey's submittal and other supporting
information used in developing the final interim approval are available
for inspection (docket number CA-MN-95-1-OPS) during normal business
hours at the following location: U.S. Environmental Protection Agency,
Region IX, Air and Toxics Division, 75 Hawthorne Street, San Francisco,
CA 94105.
FOR FURTHER INFORMATION CONTACT: Regina Spindler (telephone 415-744-
1251), Mail Code A-5-2, U.S. Environmental Protection Agency, Region
IX, Air and Toxics Division, 75 Hawthorne Street, San Francisco, CA
94105.
SUPPLEMENTARY INFORMATION:
I. Background and Purpose
Title V of the 1990 Clean Air Act Amendments (sections 501-507 of
the Clean Air Act (``the Act'')), and implementing regulations at 40
Code of Federal Regulations (CFR) part 70 require that states develop
and submit operating permits programs to EPA by November 15, 1993, and
that EPA act to approve or disapprove each program within 1 year after
receiving the submittal. The 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.
On May 16, 1995, EPA proposed interim approval of the operating
permits program for the Monterey Bay Unified Air Pollution Control
District. See 60 FR 26013. The EPA received public comment on the
proposal and is responding to those comments in this document and in a
separate ``Response to Comments'' document contained in the docket at
the Regional Office. As a result of public comment, EPA has modified
one of the interim approval issues set forth in the May 16, 1995
proposal. The EPA's proposed action on the operating permits program is
therefore being revised to reflect the modification of the interim
approval issue. This change is discussed below in II.B. along with the
other issues raised during the public comment period. The May 16, 1995
Federal Register notice also proposed approval of Monterey's interim
mechanism for implementing section 112(g) and proposed approval under
section 112(l) of the District's program for accepting delegation of
section 112 standards as promulgated. The EPA did not receive any
public comment on these proposed actions. With the exception of the
modification to the interim approval issue discussed above, the
proposed actions discussed above have not been altered as a result of
public comment. In this notice EPA is taking final action to promulgate
interim approval of the operating permits program and approving the
section 112(g) mechanism and section 112(l) program for delegation
noted above for Monterey.
II. Final Action and Implications
A. Analysis of District Submission
Monterey's original title V program was submitted by the California
Air Resources Board (CARB) on December 6, 1993. Additional material was
submitted on February 2, 1994 and April 7, 1994. The submittal was
found to be complete on February 4, 1994. The EPA determined in its
evaluation of Monterey's program that Rule 218, the
[[Page 52333]]
District's permitting regulation, contained several deficiencies that
were cause for disapproval of the program. The EPA described these
deficiencies and the corrections necessary to make the program eligible
for interim approval in a letter from Felicia Marcus, EPA Region IX
Administrator, to Abra Bennett, Monterey Air Pollution Control Officer
(APCO), dated July 22, 1994. In response, Monterey adopted a revised
regulation which was submitted by CARB on the District's behalf on
October 13, 1994. On May 16, 1995, EPA proposed interim approval of
Monterey's title V operating permits program in accordance with
Sec. 70.4(d), on the basis that the program ``substantially meets''
part 70 requirements. The analysis in the proposed document remains
unchanged and will not be repeated in this final document. With the
exception of the modification to the interim approval issue regarding
affected state review discussed below in II.B.5., the program
deficiencies identified in the proposed document, and outlined below in
II.C., remain unchanged and must be corrected for the District to have
a fully approvable program.
At the time of proposal, EPA believed that an implementation
agreement would be completed prior to final interim approval. The EPA
and Monterey have not yet finalized the implementation agreement, but
are working to do so as soon as practicable.
B. Public Comments and Responses
The EPA received comments on the proposed interim approval of the
Monterey program from one public commenter, the Monterey Bay Unified
Air Pollution Control District. These comments are discussed below.
1. Insignificant Activities
Monterey commented that it would like to propose, for full title V
program approval, emission levels for insignificant activities of 2
tons per year for criteria pollutants and the lesser of 1000 pounds per
year, section 112(g) de minimis levels, or other title I significant
modification levels for hazardous air pollutants and other toxics. The
District commented that it believes these levels to be sufficiently
below the applicability thresholds for all applicable requirements and
will ensure that no unit potentially subject to an applicable
requirement is left off of a title V permit application.
In the May 16, 1995 proposed interim approval of Monterey's
program, EPA stated that it had proposed to accept, as sufficient for
full approval of other state and district programs, the emission levels
for insignificant activities as described above in Monterey's comment.
The EPA stated that it believes these levels to be sufficiently below
the applicability thresholds of many applicable requirements to assure
that no unit potentially subject to an applicable requirement is left
off a title V application. Monterey has commented that it believes
these levels to be appropriate for determining insignificant activities
in the District. If Monterey establishes these emission levels for
defining insignificant activities in its program and submits this as a
title V program revision to EPA, EPA will find that aspect of the
insignificant activity definition fully approvable. As discussed below
in II.C.7., to receive full approval of its insignificant activity
provisions, Monterey must also revise Rule 218 to require that
insignificant activities that are exempted because of size or
production rate be listed in the permit application and to require that
an application may not omit information needed to determine the
applicability of, or to impose, any applicable requirement, or to
evaluate the fee amount required.
2. ``Title I Modification''
Monterey commented that ``title I modifications'' should not be
interpreted to include minor new source review and endorsed the
recommendations and legal arguments made by CARB in its September 27,
1994 letter from Michael Scheible to the EPA Air Docket.
At the time of the May 16, 1995 proposed interim approval, EPA was
in the process of determining the proper definition of title I
modification, and therefore did not identify Monterey's treatment of
title I modification as necessary grounds for either interim approval
or disapproval. In an August 29, 1994 rulemaking proposal, EPA
explained its view that the better reading of ``title I modifications''
includes minor NSR. However, the Agency solicited public comment on
whether the phrase should be interpreted to mean literally any change
at a source that would trigger permitting authority review under
regulations approved or promulgated under title I of the Act. (59 FR
44572, 44573). This would include state preconstruction review programs
approved by EPA as part of the State Implementation Plan under section
110(a)(2)(C) of the Clean Air Act.
The EPA has not yet taken final action on the August 29, 1994
proposal. However, in response to public comment on that proposal, the
Agency has decided that the definition of ``title I modifications'' is
best interpreted as not including changes reviewed under minor NSR
programs. This decision was announced in a June 20, 1995 letter from
Mary D. Nichols, EPA Assistant Administrator for Air and Radiation, to
Congressman John D. Dingell, and will be included in a supplemental
rulemaking proposal that will be published in September, 1995. Thus,
EPA expects to confirm that Monterey's definition of ``title I
modification'' is fully consistent with part 70.
The August 29, 1994 action proposed to, among other things, allow
state programs with a more narrow definition of ``title I
modifications'' to receive interim approval (59 FR 44572). The Agency
stated that if, after considering the public comments, it continued to
believe that the phrase ``title I modifications'' should be interpreted
as including minor NSR changes, it would revise the interim approval
criteria as needed to allow states with a narrower definition to be
eligible for interim approval. If EPA does conclude, during this
rulemaking, that Title I modifications should be read to include minor
NSR, it will implement the interim approval option spelled out in the
August 29, 1994 proposal.
3. Implementation Agreement
In the May 16, 1995 proposed interim approval, EPA stated that an
implementation agreement is currently being developed by EPA and
Monterey. Monterey commented that they disagree with EPA over the
structure and the basis for an implementation agreement and take
exception to the implementation agreement language contained in the
notice and therefore suggest that it be removed prior to publication of
the final notice. Since Monterey submitted this comment, EPA and the
District have engaged in numerous conversations regarding the
implementation agreement and Monterey has indicated that it does intend
to develop an agreement with EPA. EPA and the District are currently
negotiating the appropriate format and content of that agreement.
4. District Rule 201 Correction
Monterey commented that EPA had incorrectly stated in the May 16,
1995 proposal that Rule 201 ``was adopted or revised to implement title
V.'' The District pointed out that Rule 201 was adopted prior to
promulgation of part 70 and was not revised to implement title V. The
EPA therefore revises the statement made in the May 16, 1995 proposal
to state that Rule 201 was submitted as a supporting regulation of
[[Page 52334]]
the Monterey title V program. This change does not affect EPA's May 16,
1995 proposed action.
5. Affected State Review
In the May 16, 1995 proposed interim approval, EPA proposed that in
order to receive full approval Monterey must revise Rule 218 to define
and provide for giving notice to affected states per Secs. 70.2 and
70.8(b). The EPA reasoned that although emissions from Monterey may not
currently affect any neighboring states, Native American tribes may in
the future apply for treatment as states for air program purposes and
if granted such status would be entitled to affected state review under
title V. (See EPA's proposed Tribal Air Rule at 59 FR 43956, August 25,
1994.) Monterey commented that it would be appropriate to revise Rule
218 to provide for giving notice to affected states at such time as a
Native American tribe or tribes apply for treatment as a state. The EPA
is concerned about the timing issues involved with delaying the
adoption of affected state notice provisions in Monterey's program
until tribes apply for state status. Although the federal rule that
will enable tribes to apply for treatment as states has not yet been
finalized, and there are no tribes currently eligible for treatment as
a state under the Act, EPA believes that the likelihood of Native
American tribes qualifying as affected states under part 70 is great
and that Monterey will ultimately need to revise its rule to address
this outcome. Nonetheless, EPA is willing to accept as an alternative
to adopting affected state notice provisions up front, a commitment to:
(1) Initiate rule revisions upon being notified by EPA of an
application by an affected tribe for state status, and (2) provide
affected state notice to tribes upon their filing for state status
(i.e., prior to Monterey revising Rule 218 to incorporate affected
state notice procedures).
C. Final Action
1. Monterey's Title V Operating Permits Program
The EPA is promulgating interim approval of the operating permits
program submitted by the Monterey Bay Unified Air Pollution Control
District. The District must make the following changes, or changes that
have the same effect, to receive full approval:
(1) Revise section 1.3 to require that, regardless of the source's
actual or potential emissions, acid rain sources and solid waste
incineration units required to obtain a permit pursuant to section
129(e) of the Act may not be exempted from the requirement to obtain a
permit pursuant to Rule 218. Section 70.3(b) requires that major
sources, affected sources (acid rain sources), and solid waste
incinerators may not be exempted from the program. Monterey's deferral
for certain major sources other than acid rain sources and solid waste
incinerators is allowable under EPA's ``Interim Approval Guidance,''
issued by John Seitz on August 2, 1993.
(2) Revise section 2.1.4 of the definition of ``Administrative
Permit Amendments'' as follows:
``requires more frequent monitoring or reporting for the stationary
source; or''
Increasing monitoring requirements could be a significant change to
these requirements. Significant changes in monitoring must be processed
as significant permit modifications. (Sec. 70.7(d)(1)(iii),
Sec. 70.7(e)(4))
(3) Revise the definition of ``Federally Enforceable Requirement''
in section 2.12 to include any standard or other requirement provided
for in the State Implementation Plan approved or promulgated by EPA.
This revision is necessary to make the section 2.12 definition
consistent with the part 70 definition of ``Applicable requirement''
and with the Rule 218, section 4.2.4 requirement that each permit
require compliance with any standard or requirement set forth in the
applicable implementation plan.
(4) Revise section 2.18.4 of the definition of ``Minor Permit
Modification'' to require that a minor permit modification may not
establish or change a permit condition used to avoid a federally
enforceable requirement to which the source would otherwise be subject.
(Sec. 70.7(e)(2)(i)(A)(4))
(5) Revise section 3.1.6.12 to require that the compliance
certification within the permit application include a statement
indicating the source's compliance status with any applicable enhanced
monitoring and compliance certification requirements of the Act.
(Sec. 70.5(c)(9)(iv))
(6) Revise section 3.1.6.13 as follows to be consistent with
Sec. 70.5(c)(8)(iii)(C):
* * * a schedule of compliance approved by the District hearing
board that identifies remedial measures, including an enforceable
sequence of actions, with specific increments of progress, a final
compliance date, testing and monitoring methods, recordkeeping
requirements, and a schedule for submission of certified progress
reports to the USEPA and the APCO at least every 6 months. This
schedule of compliance shall resemble and be at least as stringent
as that contained in any judicial consent decree or administrative
order to which the source is subject; and * * *''
(7) Provide a demonstration that activities that are exempt from
permitting under Rule 218 (pursuant to Rule 201, the District's permit
exemption list) are truly insignificant and are not likely to be
subject to an applicable requirement. Alternatively, Rule 218 may
restrict the exemptions to activities that are not likely to be subject
to an applicable requirement and emit less than District-established
emission levels. The District should establish separate emission levels
for HAP and for other regulated pollutants and demonstrate that these
emission levels are insignificant compared to the level of emissions
from and type of units that are required to be permitted or subject to
applicable requirements. Revise Rule 218 to require that insignificant
activities that are exempted because of size or production rate be
listed in the permit application. Revise Rule 218 to require that an
application may not omit information needed to determine the
applicability of, or to impose, any applicable requirement, or to
evaluate the fee amount required. (Sec. 70.5(c), Sec. 70.4(b)(2))
(8) Revise section 3.5.3 to provide that the APCO shall also give
public notice ``by other means if necessary to assure adequate notice
to the affected public.'' (Sec. 70.7(h)(1))
(9) Revise Rule 218 to include the contents of the public notice as
specified by Sec. 70.7(h)(2).
(10) Revise Rule 218 to provide that the District shall keep a
record of the commenters and of the issues raised during the public
participation process so that the Administrator may fulfill her
obligation to determine whether a citizen petition may be granted.
(Sec. 70.7(h)(5))
(11) The EPA must be provided with 45 days to review the version of
the permit that incorporates any public comments and that the District
proposes to issue. Rule 218 indicates that the District intends to
provide for concurrent public and EPA review of the draft permit.
Therefore, the District must revise the rule to provide that EPA will
have an additional 45 days to review the proposed permit if it is
revised as a result of comments received from the public.
(Sec. 70.8(a)(1))
(12) Revise Rule 218 to define and provide for giving notice to
affected states per Secs. 70.2 and 70.8(b). Alternatively, Monterey may
make a commitment to: (1) Initiate rule revisions upon being notified
by EPA of an application by an affected tribe for state status, and (2)
provide affected
[[Page 52335]]
state notice to tribes upon their filing for state status (i.e., prior
to Monterey's adopting affected state notice rules).
(13) Revise section 3.7.1 to require that the permit shall be
reopened under the circumstances listed in sections 3.7.1.1 to 3.7.1.3.
(Sec. 70.7(f)(1))
(14) Revise section 3.8.2 to provide, consistent with
Sec. 70.7(e)(2)(iv), that the District shall take action on a minor
permit modification application within 90 days of receipt of the
application or 15 days after the end of the 45-day EPA review period,
whichever is later. Currently, the District rule provides that the
permit be issued within 90 days after the application is deemed
complete (section 3.3.2 provides 30 days from receipt for a
completeness determination) or 60 days after written notice and
concurrence from EPA, whichever is later. The EPA will not necessarily
provide written notice and concurrence on minor permit modifications
and the District rule does not address what action is taken should EPA
not provide written notice. (Sec. 70.7(e)(2)(iv))
(15) Revise section 3.8.2 to provide that the action taken on a
minor permit modification application in the timeframes discussed above
in (14) shall be one of the following:
(a) Issue the permit modification as proposed;
(b) Deny the permit modification application;
(c) Determine that the requested modification does not meet the
minor permit modification criteria and should be reviewed under the
significant modification procedures; or
(d) Revise the draft permit modification and transmit to the
Administrator the new proposed permit modification.
The current District rule states that the minor permit modification
shall be completed within the timeframes discussed above in (14), but
does not specify that the District must take one of the actions listed
above. (Sec. 70.7(e)(2)(iv))
2. California Enabling Legislation--Legislative Source Category Limited
Interim Approval Issue
Because California State law currently exempts agricultural
production sources from permit requirements, the California Air
Resources Board had requested source category-limited interim approval
for all California districts. The May 16, 1995 proposed interim
approval included a proposal to grant source category-limited interim
approval to Monterey. The EPA is finalizing this source category-
limited interim approval. In order for this program to receive full
approval (and to avoid a disapproval upon the expiration of this
interim approval), the California Legislature must revise the Health
and Safety Code to eliminate the exemption of agricultural production
sources from the requirement to obtain a permit.
The above described program and legislative deficiencies must be
corrected before Monterey can receive full program approval.
The scope of Monterey's part 70 program approved in this notice
applies to all part 70 sources (as defined in the approved program)
within the District, except any sources of air pollution over which an
Indian Tribe has jurisdiction. See, e.g., 59 FR 55813, 55815-18 (Nov.
9, 1994). The term ``Indian Tribe'' is defined under the Act as ``any
Indian tribe, band, nation, or other organized group or community,
including any Alaska Native village, which is federally recognized as
eligible for the special programs and services provided by the United
States to Indians because of their status as Indians.'' See section
302(r) of the CAA; see also 59 FR 43956, 43962 (Aug. 25, 1994); 58 FR
54364 (Oct. 21, 1993).
This interim approval, which may not be renewed, extends until
November 6, 1997. During this interim approval period, Monterey is
protected from sanctions, and EPA is not obligated to promulgate,
administer and enforce a federal operating permits program in the
District. 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 this interim approval, as does the 3-year time period
for processing the initial permit applications.
If Monterey fails to submit a complete corrective program for full
approval by May 6, 1997, EPA will start an 18-month clock for mandatory
sanctions. If Monterey then fails to submit a corrective program that
EPA finds complete before the expiration of that 18-month period, EPA
will be required to apply one of the sanctions in section 179(b) of the
Act, which will remain in effect until EPA determines that the District
has corrected the deficiency by submitting a complete corrective
program. Moreover, if the Administrator finds a lack of good faith on
the part of Monterey, both sanctions under section 179(b) will apply
after the expiration of the 18-month period until the Administrator
determined that the District had come into compliance. In any case, if,
six months after application of the first sanction, the District still
has not submitted a corrective program that EPA has found complete, a
second sanction will be required.
If EPA disapproves Monterey's complete corrective program, EPA will
be required to apply one of the section 179(b) sanctions on the date 18
months after the effective date of the disapproval, unless prior to
that date the District has submitted a revised program and EPA has
determined that it corrected the deficiencies that prompted the
disapproval. Moreover, if the Administrator finds a lack of good faith
on the part of the District, both sanctions under section 179(b) shall
apply after the expiration of the 18-month period until the
Administrator determines that Monterey has come into compliance. In all
cases, if, six months after EPA applies the first sanction, Monterey
has not submitted a revised program that EPA has determined corrects
the deficiencies, a second sanction is required.
In addition, discretionary sanctions may be applied where warranted
any time after the expiration of an interim approval period if Monterey
has not timely submitted a complete corrective program or EPA has
disapproved its submitted corrective program. Moreover, if EPA has not
granted full approval to the District program by the expiration of this
interim approval and that expiration occurs after November 15, 1995,
EPA must promulgate, administer and enforce a federal permits program
for Monterey upon interim approval expiration.
3. District Preconstruction Permit Program Implementing Section 112(g)
The EPA is approving the use of Monterey's preconstruction review
program as a mechanism to implement section 112(g) during the
transition period between promulgation of EPA's section 112(g) rule and
adoption by Monterey of rules specifically designed to implement
section 112(g). The EPA is limiting the duration of this approval to 12
months following promulgation by EPA of the section 112(g) rule.
4. Program for Delegation of Section 112 Standards as Promulgated
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 promulgating approval under section
[[Page 52336]]
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. Docket
Copies of the District's submittal and other information relied
upon for the final interim approval, including one public comment
letter received and reviewed by EPA on the proposal, are contained in
docket number CA-MN-95-1-OPS 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 final interim approval. The docket is available for public
inspection at the location listed under the ADDRESSES section of this
document.
B. Executive Order 12866
The Office of Management and Budget has exempted this action from
Executive Order 12866 review.
C. Regulatory Flexibility Act
The 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.
D. 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
the private sector, of $100 million or more. Under section 205, EPA
must select the most cost-effective and least burdensome alternative
that achieves the objectives of the rule and is consistent with
statutory requirements. Section 203 requires EPA to establish a plan
for informing and advising any small governments that may be
significantly or uniquely impacted by the rule.
The EPA has determined that the approval action promulgated today
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
approves pre-existing requirements under state or local law, and
imposes no new federal requirements. Accordingly, no additional costs
to state, local, or tribal governments, or to the private sector,
result from this action.
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.
Dated: September 21, 1995.
John Wise,
Acting Regional Administrator.
Part 70, title 40 of the Code of Federal Regulations is amended as
follows:
PART 70--[AMENDED]
1. The authority citation for part 70 continues to read as follows:
Authority: 42 U.S.C. 7401, et seq.
2. Appendix A to part 70 is amended by adding paragraph (r) to the
entry for California to read as follows:
Appendix A to Part 70--Approval Status of State and Local Operating
Permits Programs
* * * * *
The following district program was submitted by the California
Air Resources Board on behalf of:
(r) Monterey Bay Unified Air Pollution Control District:
submitted on December 6, 1993, supplemented on February 2, 1994 and
April 7, 1994, and revised by the submittal made on October 13,
1994; interim approval effective on November 6, 1995; interim
approval expires November 6, 1997.
* * * * *
[FR Doc. 95-24453 Filed 10-5-95; 8:45 am]
BILLING CODE 6560-50-P
