[Federal Register Volume 59, Number 36 (Wednesday, February 23, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-4053]
[[Page Unknown]]
[Federal Register: February 23, 1994]
=======================================================================
-----------------------------------------------------------------------
ENVIRONMENTAL PROTECTION AGENCY
40 CFR Part 52
[MN13-1-5623; FRL-4840-8]
Approval and Promulgation of Implementation Plans; Minnesota
AGENCY: United States Environmental Protection Agency (USEPA).
ACTION: Proposed rule.
-----------------------------------------------------------------------
SUMMARY: USEPA is proposing to approve a revision to the Minnesota
State Implementation Plan (SIP) for new source review in nonattainment
areas, submitted to meet longstanding requirements as well as new
requirements imposed by the Clean Air Act Amendments of 1990. This
revision consists of the State Rules 7005.3010 through 7005.3060, which
incorporate by reference the new source review requirements specified
in appendix S to title 40 Code of Federal Regulations part 51 (40 CFR
part 51), ``Emission Offset Interpretive Ruling,'' except for the
deletion of unacceptable exemptions included in appendix S. Final
approval of this revision would lift the current ban on permitting
major sources and major modifications in Minnesota nonattainment areas.
DATES: Comments on this proposed action must be received in writing by
March 25, 1994.
ADDRESSES: Written comments should be sent to: William L. MacDowell,
Chief, Regulation Development Section (AE-17J), U.S. Environmental
Protection Agency, 77 West Jackson Boulevard, Chicago, Illinois 60604.
Copies of the SIP revision request and USEPA's analysis are
available for inspection at the following address: (It is recommended
that you telephone John Summerhays at (312) 886-6067, before visiting
the Region 5 Office.) U.S. Environmental Protection Agency, Region 5,
Air and Radiation Division, 77 West Jackson Boulevard, Chicago,
Illinois 60604.
FOR FURTHER INFORMATION CONTACT: John Summerhays, Regulation
Development Section, Air Enforcement Branch, U.S. Environmental
Protection Agency, Region 5, Chicago, Illinois 60604.
SUPPLEMENTARY INFORMATION:
I. Summary of State Submittal
Part D of title I of the Clean Air Act sets forth SIP requirements
for nonattainment areas. Section 173 and the various subparts of title
I contain the program requirements for the review and issuance of
permits for the construction of major new sources and major
modifications in a nonattainment area. Currently, Minnesota has no
approved nonattainment area permitting program. On August 5, 1992, and
August 26, 1993, Minnesota submitted revised new source review
regulations for the purpose of meeting these requirements.
The statutory requirements that apply to State regulations for new
source review in nonattainment areas are set forth at part D of title I
of the Clean Air Act, particularly in sections 172(c)(5) and 173.
Federal regulations developed prior to enactment of the Clean Air Act
Amendments of 1990 for nonattainment area new source review programs
are set forth at title 40 Code of Federal Regulations part 51 (40 CFR
part 51), particularly 40 CFR 51.165. The Clean Air Act Amendments of
1990 also establish assorted new requirements, for which preliminary
guidance was published April 16, 1992 (57 FR 13498), and April 28, 1992
(57 FR 18070). For example, section 189(a)(1)(A) requires that sections
172(c)(5) and 173 be met for fine particulate matter nonattainment
areas.
The Minnesota Pollution Control Agency (MPCA) has submitted general
permitting regulations to USEPA on various occasions, including January
28, 1972; May 28, 1972; January 23, 1981; and January 7, 1985. USEPA
approved the 1972 submittals on May 31, 1972; the 1981 submittal on May
6, 1982; and the 1985 submittal on May 13, 1988. However, these rules
did not address the specific requirements for permitting new and
modified major sources in nonattainment areas. Consequently, Minnesota
has no approved nonattainment area permitting program, and the State
continues to be subject to a prohibition against permitting major new
sources and major modifications in the State's nonattainment areas, as
promulgated by USEPA on July 2, 1979 (44 FR 38583). More recent MPCA
submittals, which are the subjects of this proposed rulemaking, were
intended to address the requirements for nonattainment area new source
permitting and allow USEPA to lift the permitting prohibition.
MPCA has submitted SIP revisions for meeting the permitting
requirements of part D on two previous occasions. MPCA's first
submittal was on December 22, 1981. USEPA proposed conditional approval
of this rule in the July 29, 1982, Federal Register (47 FR 32742).
Minnesota used the plant-wide definition of source in its rule. Before
final rulemaking could be published, the D.C. Circuit Court ruled
against the plant-wide definition of source. This decision was later
overturned (Chevron, U.S.A., Inc. v. NRDC, 104 S.Ct. 2778 (1984)), but
USEPA never approved this SIP revision because of other concerns. This
submittal was ultimately withdrawn, in an August 21, 1990, letter from
the Commissioner of MPCA, and USEPA's proposed action on this submittal
was withdrawn in the Federal Register of November 7, 1990 (55 FR
46829).
MPCA submitted its second revision for meeting the permitting
requirements on March 13, 1989. In February 1990, USEPA provided MPCA
with comments, stating that the rule would not be approved. In a
February 24, 1992, letter, Charles W. Williams, Commissioner, MPCA,
withdrew the March 13, 1989, submittal.
The current revisions being addressed in this rulemaking include
State submittals of August 5, 1992, and August 26, 1993. These
submittals include State Rules 7005.3010 through 7005.3060 (``Offset
Rule''). These rules incorporate appendix S to 40 CFR part 51 into
these State rules, modified in response to recommendations by USEPA.
Section 173 of the Act identifies four essential requirements that
State new source permit regulations must impose in nonattainment areas:
(1) New source emissions must be offset by equivalent or greater
emission reductions in the area, (2) the new source must have lowest
achievable emission rates (LAER), (3) other sources owned by the owner
or operator of the new source must be in compliance or on a schedule to
achieve compliance with applicable regulations, and (4) the area must
not be subject to a finding of failure to implement the SIP.
Incorporation of Appendix S
In general, adoption of appendix S of 40 CFR part 51 into the
State's regulations serves to impose the requirements identified in
section 173. Part IV. A. of appendix S provides multiple conditions for
granting a permit, including a requirement for lowest achievable
emission rates (requirement 2 above), a requirement for compliance of
commonly owned sources (requirement 3 above), and a requirement for
offsets (requirement 1 above). Although appendix S contains no
provision prohibiting permits in ``failure to implement'' areas, USEPA
has adequate authority under section 113(a)(5) to take any necessary
action to address permits that violate this prohibition.
Nevertheless, the adoption of appendix S by reference as a State
rule fails to satisfy permitting requirements under subpart I of 40 CFR
part 51. In particular, appendix S exempts certain source types and is
insufficiently clear on some issues. A letter from USEPA dated May 17,
1991, recommended the following modifications:
1. The requirement for LAER must apply to all new sources or
modifications meeting the applicability requirements of 40 CFR 51.165.
Footnotes 4 and 5 must be deleted.
2. Requirements for offsets must be clarified to ensure that
offsets are based on actual emissions as defined in 40 CFR
51.165(a)(3). This clarification must also be made in Part IV, section
C. Footnote number 7 must be deleted.
3. Footnote 8, which provided an exemption from the requirement for
net air quality benefit, must be deleted.
4. Section B of Part IV, which exempts certain source types, must
be deleted.
5. Section C, paragraph 5, which allows ``banking'' of emissions
offset credits, must either be deleted or supplemented with approvable
banking regulations.
Minnesota has made each of these modifications to its rules. Most
of these modifications were included in the rule revisions submitted
August 5, 1992. In addition, pursuant to communications from USEPA
subsequent to the May 1991 letter, the State made further
modifications, including deletion of the general provisions for
banking.
Relationship to Subsequent Rule Revisions
At present, the rules in the Minnesota SIP governing permit
processing are the Consolidated Permit Rules adopted by the State on
July 24, 1984, and approved by USEPA on May 13, 1988 (53 FR 17033). The
subject of today's rulemaking is a supplemental rule known as the
``Offset Rule,'' which establishes the substantive requirements for new
sources in nonattainment areas. Minnesota then adopted significant
revisions to its regulations on permit processing on August 24, 1993,
which it submitted for SIP rulemaking on November 23, 1993. The primary
purposes of these regulations were to satisfy requirements in Title V
of the Clean Air Act for a State operating permit program and to amend
the new source permitting regulations to provide an integrated set of
permitting regulations. In developing these regulations, the State
incorporated language intended to address various concerns USEPA had
identified with respect to the prior permitting rules.
Today's rulemaking does not address the approvability of the
submittal of November 23, 1993. Nevertheless, this latter submittal is
germane to this rulemaking, insofar as these more recent revisions
assure that certain potential problems which could have arisen under
the prior general permitting rules will not arise. It should be noted
that the November 1993 submittal does not amend the rules under
consideration in this action, i.e. the ``Offset Rule'' submitted by the
State in August 1992 and amended in August 1993, but instead revises
the general provisions in the Consolidated Permit Rules concerning
permit processing. The following paragraphs identify the issues that
were of concern and how the November 1993 submittal affects these
issues.
The first issue was provision in the prior general permitting
regulations for expiration of permits, and a concern that expiration of
a permit could cause the construction permit conditions to expire. The
State's general permitting regulations now define ``Title I
conditions'' to include conditions established to satisfy new source
review requirements, and state that ``[a]ny Title I condition shall
remain in effect without regard to permit expiration or reissuance, and
shall be restated in the reissued permit.'' Therefore, USEPA believes
that requirements imposed on sources during new source review clearly
do not expire as a result of permit expiration.
The second issue of concern was the authority granted in State law
for the State agency to grant variances, including variances from
Federal requirements. However, the revised general permitting
regulations state that: (1) The State agency ``shall not issue
variances from any Federal requirement to obtain an air quality permit,
unless explicitly authorized to do so in writing by [USEPA],'' and (2)
the State agency ``shall issue a permit * * * only if [various
conditions have been met including that] the permit does not reflect a
variance from any federally enforceable applicable requirement * * *.''
For purposes of this action, these provisions render the second issue
moot, insofar as the State agency no longer has the ability to grant
variances from Federal requirements. Nevertheless, it is appropriate to
state that USEPA believes that the statutory provision for variances is
not being approved and that issuance of a variance from Federal
requirements would be contrary to both State and Federal regulations
and would have no bearing on enforcement of the applicable requirement.
The third issue of concern was that public notice for new source
review permits was provided for only in a Memorandum of Understanding
(MOU) containing several outdated references. The revised general
permitting regulations provide public notification procedures and a 30
day public comment period. Minnesota has clearly committed itself both
in the MOU and its regulations to continuing to provide for proper
opportunity for public input into permitting decisions in accordance
with USEPA requirements.
For all three of these issues, Minnesota has made clear through its
revised general permitting regulations that the SIP as revised by the
rule under consideration in this action would satisfy Federal
requirements. Therefore, USEPA believes that the three issues discussed
above are no longer impediments to today's proposed conclusion that
Minnesota has satisfied nonattainment area permitting requirements.
The fourth issue of concern was whether Minnesota had satisfied the
requirement of 40 CFR 51.160(a) to assure that new sources do not
interfere with attainment or maintenance of the air quality standards.
The general permitting regulations in Minnesota's SIP require permits
for facilities with emissions above 25 tons per year of any criteria
pollutant except lead, or with more than \1/2\ ton of lead emissions
per year. (At such a facility, any modification would require a
permit.) The recently submitted permitting rules raise some of these
size cutoffs. In support of the raised cutoffs, the State's recent
submittal includes a modeling analysis to show that the revised size
cutoffs do not interfere with attainment or maintenance. A preliminary
review indicates that this analysis adequately supports the size
cutoffs in the current SIP. Consequently, USEPA believes that the
general permitting rules in the SIP as supplemented by the Offset Rule
satisfy 40 CFR 51.160(a). Nevertheless, USEPA is reserving judgment on
the acceptability of the recently raised size cutoffs, which will be
addressed in the context of rulemaking on the more recent submittal.
The fifth issue of concern pertained to a provision in the State's
Rule 7001.0150 authorizing the State not to enforce ``local laws, rules
and plans.'' Although this provision clearly applies to local laws and
not Federal laws, this provision is arguably ambiguous as to whether
the State is authorized not to enforce Federal as well as local rules
and plans. The recent rule revisions did not modify this provision.
Nevertheless, the State's intent is presumably that the regulations
only authorize nonenforcement of relevant local laws, local rules, and
local plans. USEPA is expressly not proposing approval of any provision
for State nonenforcement of Federal rules or Federal plans. USEPA
solicits public comment on this element of the proposed approval.
USEPA has reviewed whether the new requirements in the Clean Air
Act Amendments of 1990 have been satisfied. These new requirements
include an analysis of alternatives, and a requirement for submitting
information to the RACT/BACT/LAER Clearinghouse. The Amendments also
introduce numerous new requirements that are not currently relevant to
Minnesota, in part because the State has no ozone nonattainment areas.
The TSD provides a more detailed discussion of the new requirements and
how these requirements are addressed in Minnesota. The conclusion of
this review is that Minnesota has satisfactorily addressed these
requirements as they currently apply in the State.
USEPA is currently developing a rule to implement the changes under
the Clean Air Act Amendments of 1990 in the new source review
provisions in Parts C and D of Title I of the Act. The Agency
anticipates that the proposed rule will be published for public comment
in the spring or summer of 1994. If USEPA has not taken final action on
Minnesota's new source review submittal by that time, USEPA may
generally refer to the proposed rule as guidance regarding the
approvability of the submittal. USEPA expects to take final action to
promulgate a rule to implement the Parts C and D changes sometime
during 1994 or 1995. Upon promulgation of those regulations, USEPA will
review new source review SIPs to determine whether additional SIP
revisions are necessary to satisfy the requirements of the rule.
Section 189(e) states that ``control requirements applicable * * *
for major stationary sources of PM10 shall also apply to major
stationary sources of PM10 precursors, except where the
Administrator determines that such sources do not contribute
significantly to PM10 levels which exceed the standard in the
area.'' On June 25, 1993 (at 58 FR 34397), USEPA proposed such a
determination of the insignificance of particulate matter precursors in
Minnesota. If that proposed action is finalized, section 189(e) would
no longer require new source review of major particulate matter
precursor sources.
II. Proposed Rulemaking Action
USEPA believes that the regulations submitted by Minnesota on
August 5, 1992, and August 26, 1993, satisfy the requirements under
Part D for a new source permitting program in nonattainment areas.
Therefore, USEPA proposes to approve this SIP revision.
Under the rules in the SIP, permits for nonattainment area sources
that satisfy the substantive requirements of the Offset Rule (Rules
7005.3010 through 7005.3060) would be processed in accordance with
permit processing provisions in the Consolidated Permit Rules (Rules
7001.0010 through 7001.0210 and Rules 7001.1200 through 7001.1220).
Rulemaking of May 13, 1988 (53 FR 17033) approved the Consolidated
Permit Rule as satisfying attainment area permitting requirements but
noted that nonattainment area permitting requirements were not met.
Today's action proposes to lift the current ban on construction of
major new sources and major modifications in Minnesota nonattainment
areas, and would impose Minnesota's Consolidated Permit Rule and Offset
Rule as Federally enforceable requirements for such new sources and
modifications. Subsequent rulemaking will address the approvability of
more recent revisions to State permitting regulations.
The rules submitted by Minnesota were intended to address
nonattainment area new source review requirements and did not address
visibility-related permitting requirements specified in 40 CFR 51.307.
Therefore, USEPA is retaining the provisions of 40 CFR 52.1236, which
note the absence of approvable State regulations for visibility
protection and impose the Federally promulgated regulations of 40 CFR
52.26 and 52.28.
Public comment is solicited on all elements of USEPA's proposed
rulemaking action. Written comments received by [Insert date 30 days
from date of publication] will be considered in the development of
USEPA's final rulemaking action.
Under the Regulatory Flexibility Act, 5 U.S.C. 600 et seq., USEPA
must prepare a regulatory flexibility analysis assessing the impact of
any proposed or final rule on small entities. (5 U.S.C. 603 and 604.)
Alternatively, USEPA may certify that the rule will not have a
significant impact on a substantial number of small entities. Small
entities include small businesses, small not-for-profit enterprises,
and government entities with jurisdiction over populations of less than
50,000.
SIP approvals under section 110 and subchapter I, part D of the Act
do not create any new requirements, but simply approve requirements
that the State is already imposing. Therefore, because the federal SIP
approval does not impose any new requirements, I certify that it does
not have a significant impact on any small entities affected. Moreover,
due to the nature of the Federal-State relationship under the Act,
preparation of a regulatory flexibility analysis would constitute
federal inquiry into the economic reasonableness of state action. The
Act forbids USEPA to base its actions concerning SIPs on such grounds.
Union Electric Co. v. USEPA, 427 U.S. 246, 256-66 (S.Ct. 1976); 42
U.S.C. 7410(a)(2).
The Office of Management and Budget has exempted this rule from the
requirements of section 6 of Executive Order 12866.
List of Subjects in 40 CFR Part 52
Environmental protection, Air pollution control, Carbon monoxide,
Incorporation by reference, Intergovernmental relations, Lead,
Particulate matter, Reporting and recordkeeping requirements, Sulfur
oxides.
Authority: 42 U.S.C. 7401-7671q.
Dated: January 19, 1994.
David Kee,
Acting Regional Administrator.
[FR Doc. 94-4053 Filed 2-22-94; 8:45 am]
BILLING CODE 6560-50-P
