[Federal Register Volume 60, Number 80 (Wednesday, April 26, 1995)]
[Proposed Rules]
[Pages 20465-20469]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-10244]
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ENVIRONMENTAL PROTECTION AGENCY
40 CFR Part 70
[AD-FRL-5197-2]
Clean Air Act Proposed Interim Approval of Operating Permits
Program; State of Iowa
AGENCY: U.S. Environmental Protection Agency (EPA).
ACTION: Proposed rule.
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SUMMARY: The EPA proposes interim approval of the Operating Permits
Program submitted by the state of Iowa for the purpose of complying
with Federal requirements which mandate that states develop, and submit
to EPA, programs for issuing operating permits to all major stationary
sources, and to certain other sources.
DATES: Comments on this proposed action must be received in writing by
May 26, 1995.
ADDRESSES: Comments may be mailed to: Christopher D. Hess,
Environmental Protection Agency, Air Branch, 726 Minnesota Avenue,
Kansas City, Kansas 66101.
FOR FURTHER INFORMATION CONTACT: Copies of the Iowa submittal and other
supporting information used in developing the proposed rule are
available for inspection during normal business hours by contacting
Christopher D. Hess at (913) 551-7213.
SUPPLEMENTARY INFORMATION:
I. Background and Purpose
A. Introduction
As required under Title V of the Clean Air Act (``the Act'') as
amended (1990), 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
[[Page 20466]] permits programs (see 57 FR 32250 (July 21, 1992)).
These rules are codified at 40 Code of Federal Regulations (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 one year after receiving the submittal. The EPA's
program review occurs pursuant to section 502 of the Act and the part
70 regulations, which 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 two years. If EPA has not fully approved a program by two years
after the November 15, 1993, date, or by the end of an interim program,
it must establish and implement a Federal program.
II. Proposed Action and Implications
A. Analysis of Submission by State Authority
Introduction. What follows are brief explanations indicating how
the submittal meets the requirements of Part 70. The reader may consult
the technical support document (TSD) for a more detailed explanation of
these topics.
1. Support Materials
a. Governor's Letter. The state of Iowa's submittal includes a
request for approval in a cover letter by the Governor. This request
also states that the entire geography of Iowa will be covered by this
program. The letter further indicates that the state will not
administer the program on any Indian lands. Therefore, EPA will retain
jurisdiction over any Indian lands.
b. Regulations. The state of Iowa has submitted regulations which
comprise the Title V program in Iowa, Administrative Code (IAC) 567-
22.100-116. The regulations are analyzed in detail under various topics
of the TSD.
Although some rule changes are required by the state as outlined in
other portions of this notice, the submittal does not identify any
provisions which restrict the operation of the program and that would,
therefore, prevent proposal of interim approval of the program by the
EPA. The Iowa Attorney General's opinion does note, however, some areas
in which the regulations may not fully match the Title V requirements.
EPA has analyzed those provisions which do not clearly match the Title
V requirements, and has provided its rationale in the TSD for
determining that they are not sufficient to prevent EPA from proposing
interim approval of the program.
Iowa has submitted evidence, consistent with the applicable part 70
requirements, that the regulations comprising the program were properly
adopted by the Environmental Protection Commission. The submittal
includes a discussion of the public review and hearing process which
the commission followed in adopting the rules.
c. Attorney General's Legal Opinion. The opinion of the Attorney
General contains the elements required by 40 CFR 70.4(b)(3) and states
there is adequate authority to meet all of the Title V and Part 70
requirements.
2. Implementation
a. Program Description. A comprehensive plan for implementing the
Title V program is included in the submittal. This plan includes
program authority, agency organization, and staffing. As noted
elsewhere in this notice, EPA's concerns with the state's uncertainty
about the exact amount of personnel and operating permit fees have
resulted in a recommendation for interim approval.
In other matters related to the program description, it is noted
that an implementation agreement was not included in Iowa's submittal,
but the EPA and the Iowa Department of Natural Resources (IDNR) are
pursuing its development in anticipation of interim approval.
Iowa intends to defer for five years sources that are not major,
except for affected sources and solid waste incineration units. The
state intends to use a voluntary SIP-based operating permit program
that will capture some of these non-Title V sources.
The state has elected not to use the presumptive minimum for its
operating permit fee. Instead, Iowa's Title V rules require a flat
(without Consumer Price Index adjustment) $24 to fund the operating
permit program. Thus, a fee demonstration was submitted by the state
which demonstrates the adequacy of the proposed $24 fee to cover the
costs of the program.
Since adoption of the rule requiring $24, the state has elected to
collect only one-half of this amount and will subsequently determine if
the total amount is necessary to implement the program and, if so, will
collect the balance of the fee at a later time.
Finally, the state will fund two local programs (Linn County and
Polk County) to prepare draft Title V permits and assist in inspections
and compliance activities in their respective jurisdictions. The IDNR
will fund the programs through a 28E interagency agreement.
b. Program Implementation. Iowa's submittal includes requirements
for permit content, procedures for permit issuance, renewal,
reopenings, revisions, and for payment of fees by sources. It further
identifies two local agencies which will participate in the operating
permit program, and contains a description of the annual compliance
inspections.
The state describes how one-third of all permit applications will
be reviewed each year for the first three years of the program. A
description of the computerized permit tracking database and data
management in general is also provided.
The submittal also indicates that the guidance outlined for the
state concerning annual inspections, stack tests, and other compliance
measures will be issued to the two local agencies in implementing the
Title V program.
c. Personnel. In its original submission of November 15, 1993, Iowa
provided a workload analysis projecting the need for 73 FTE in the
state's air bureau, with additional Title V personnel augmenting the
program from the local permitting agencies. EPA's analysis of the
state's workload verified that this estimate was adequate to
successfully implement the operating permit program.
However, in a supplemental letter dated December 6, 1994 (herein
referenced as ``supplemental letter''), the state described a decision
to hire only 10 additional personnel in FY-95, 15 in FY-96, and more
personnel in later years. Since the state's air bureau currently has
approximately 21 personnel, the current staffing plus modified
projections would result in a total of 46 personnel in contrast to the
73 originally projected.
Since modifying the original projection in its supplemental letter,
the state has not officially demonstrated to the EPA that a fully
adequate number of personnel will be hired to implement the program.
The IDNR has presented a proposal to the Environmental Protection
Commission to increase the amount of personnel to 61 FTE (instead of
46), although this has not yet been approved or officially submitted to
EPA for consideration.
For EPA to propose full approval of the program when the interim
period expires, the state must either hire additional personnel to
fulfill its original workload analysis or [[Page 20467]] demonstrate
that successful implementation of the program may be accomplished with
fewer personnel.
d. Data Management. Iowa specifies that the Administrator shall
receive a copy of each permit application or modification application
(including any attachments and compliance plan), each proposed permit,
and each final permit. This information may be submitted in a computer-
readable format compatible with the Administrator's national data base
system.
The state's submittal describes a permit tracking data base
consistent with part 70. This permit tracking system will record all
Title V applications. After issuance of the final permits, the
information from this tracking system will be used to update EPA's
Aerometric Information Retrieval System (AIRS) database. The IDNR will
maintain Title V records for a minimum of five years. Any claim of
confidentiality requires the source to submit a copy of such claim
directly to the Administrator.
e. Applicability Provisions. The program proposed by Iowa defers
for five years sources that are not major sources, affected sources, or
solid waste incineration units required to obtain a permit pursuant to
section 129(e) of the Act. This deferral is allowed by Sec. 70.3(b)(1)
until such time as the Administrator completes a rulemaking to
determine how the program should be structured for nonmajor sources.
The Administrator is making this determination for some new section 112
standards as they are being promulgated.
In some cases, nonmajor sources subject to section 112 standards
will be required to obtain Title V permits. Iowa is proposing revisions
to its regulations to require sources not exempted or deferred to
receive Title V permits, consistent with Part 70 requirements.
The state exempts from inclusion in the permit application emission
units of a certain size, emission level, or production rate if not
needed to determine the applicability of or to impose any applicable
requirements. This conforms to the provisions of Sec. 70.5(c).
The state's current regulations exempt sources subject to new
source performance standards for new residential wood heaters and the
national emission standard for hazardous air pollutants for asbestos
demolition/renovation activities, which are located at major sources
from being included in permit applications. In its supplemental letter,
the state has committed to modify this rule consistent with Part 70.
f. Permit Content. Iowa's regulations require Title V permits to
include Part 70 terms and conditions for all applicable requirements at
the time the permit is issued. These terms include the permit duration,
required monitoring, and related recordkeeping and reporting
requirements, as required by Sec. 70.6. Iowa's regulations also require
the permit to contain a condition prohibiting emissions exceeding any
allowances that the source lawfully holds under Title IV of the Act, as
required by Sec. 70.6(a)(4). The regulations further require that the
terms and conditions of each alternative scenario meet the requirements
of Part 70. Permits are also required to contain terms and conditions,
if the permit applicant requests them, for the trading of emissions
increases and decreases at the facility.
Iowa's program provides for general permits and permit shields and
meets all corresponding part 70 requirements. The program does not
include provisions for temporary sources. Instead, sources will be
required to obtain a separate part 70 permit for each location.
Iowa's program does allow for section 502(b)(10) changes, but
requires these changes to involve an emissions trade. In its
supplemental letter, the state has committed to modify this rule
consistent with part 70.
Iowa's regulations do allow for permits that contain terms and
conditions allowing for the trading of emissions increases and
decreases in the permitted facility, solely for the purpose of
complying with a Federally enforceable emissions cap.
g. Permit Applications. Iowa's regulations require sufficient
information to be submitted with the application, in accordance with
the requirements of Sec. 70.5. However, the EPA has separately notified
the state of needed modifications to the permit application forms. In
several instances, the state's rules require information to be
submitted as part of the application in accordance with 70.5, but the
forms themselves do not request all of this information.
EPA is therefore proposing approval of the program in that it meets
the requirement to include standardized forms, but will continue to
request that the state modify these forms to fully meet all of the
specified requirements.
With respect to specific permit application criteria, sources are
required to submit permit applications within 12 months after becoming
subject to the permit program or at an earlier date established under
the state operating permit registry. Applications for permit renewals
are due between six and eighteen months prior to expiration of the
permit.
Source permit applications must conform to the standard Iowa
application form, and must contain information sufficient to allow the
IDNR to determine all applicable requirements with respect to the
applicant. Iowa regulations also require that an application be deemed
complete within 60 days of receipt unless the IDNR determines them to
be incomplete.
The Iowa regulations further require that no Title V source may
operate after the time it is required to submit a timely and complete
application, except in compliance with its Title V permit. However, an
application shield is applicable if a timely and complete application
is submitted by the source. This allows the source to continue to
operate without a permit, as long as the source has submitted any
additional information requested in writing by the IDNR within the time
frame allowed.
h. Permit Issuance. The state's current regulations do not require
that when a part 70 permit prohibits construction or a change in
operation, the owner/operator must obtain a Title V permit revision
before commencing construction as required by 70.5(a)(1)(ii). However,
in its supplemental letter, the state has agreed to modify this rule to
meet part 70 requirements.
The Iowa regulations require that final action be taken on complete
applications within 18 months of submittal of a complete application,
except for initial permit applications which are subject to the three
year transition plan set forth by the Clean Air Act Amendments of 1990.
The Iowa rules require submittal of a complete application,
compliance with public participation procedures, compliance with
notification to affected states, compliance with all applicable
requirements, and allow for a 45-day period for EPA objection to a
draft permit.
The Iowa regulations provide for priority on applications for
construction or modification under an EPA-approved preconstruction
review program. Furthermore, the Iowa rules do not affect the
requirement that any source have a preconstruction permit under an EPA-
approved preconstruction review program. The Iowa program also provides
that permits being renewed are subject to the same procedural
requirements (including those for public participation, affected state,
and EPA review) that apply to initial permit issuance. The Iowa
operating permit program also provides for
[[Page 20468]] administrative amendments, which meets part 70
requirements.
Permit modification processing procedures in the Iowa program are
consistent with part 70 requirements as they provide for the same
degree of permitting authority, EPA and affected state review, and
public participation.
The Iowa program also meets the Federal minor permit modification
procedures. The Iowa program provides for promptly sending to EPA any
notice that the IDNR refuses to accept all recommendations of an
affected state regarding a proposed minor permit modification. In
addition, the Iowa program provides that the permitting authority may
approve, but may not issue, a final permit modification until after
EPA's 45-day review period or until EPA has notified the permitting
authority that EPA will not object to issuance, whichever is first.
Significant modification procedures as defined in the Iowa program
also parallel the Federal program. Iowa has included provisions which
provide that a permit shall be reopened and revised when additional
requirements become applicable to a major source with a remaining
permit term of three or more years. The state also requires that such a
reopening be completed within 18 months after promulgation of the
applicable requirement. In addition, the Iowa program provides that
proceedings to reopen a permit will follow the same procedures as apply
to initial issuance, will affect only those parts of the permit for
which cause to reopen exists, and will ensure reopenings are made as
expeditiously as practicable.
i. Compliance Tracking and Enforcement. The requirement for a
compliance tracking and enforcement program has been met by the state.
Compliance tracking will be accomplished through two means. The first
is monthly entry of compliance and enforcement information into AIRS.
The second is an ongoing commitment in the annual section 105 grant
workplans to provide EPA with copies of all enforcement documents. The
enforcement program will consist of periodic ``for cause'' inspections,
followed by any appropriate enforcement action consistent with the
State/EPA Enforcement Agreement. The state has demonstrated adequate
enforcement authority consistent with Sec. 70.1 to seek injunctive
relief, to assess or sue to recover civil penalties, and to seek
criminal remedies, including fines. Civil and criminal penalties are
recoverable in a maximum amount of not less than $10,000 per day.
j. Public Participation, EPA, and Affected States Review. Iowa's
submittal ensures that all permit applications are available to the
public. All requirements are included to ensure that each interested
citizen will be aware of proposed and final permit actions. This
includes the commitment to keep a record of proceedings that will allow
citizens to object to a permit up to 60 days after the EPA review
period.
Iowa has adopted rules that ensure mutual review by affected states
and the EPA. The state will not issue a permit when it is objected to
in accordance with Part 70.8(c).
3. Fee Demonstration
The state's rules provide for a fee of $24 per ton per year, which
is required to be reviewed and adjusted as necessary by the
Environmental Protection Commission annually. Thus, a detailed fee
demonstration was submitted by the state since this amount is below the
presumptive minimum set forth in Sec. 70.9(b)(12). The IDNR provided a
list of sources and the estimated actual and potential emissions from
each source with a projected total revenue. This estimate adequately
covers the program's anticipated operating costs if the $24 fee is
maintained. If this fee is reduced, a revised demonstration will be
required from the state.
The state is also required by Sec. 70.9(d) to provide an initial
accounting of how required fee revenues are to be used solely to cover
the costs of meeting the various functions of the permitting program.
IAC Sec. 455.133B provides that any Title V fees collected shall be
deposited in an air contaminant source fund. This provision further
states that these fees ``shall be used solely to defray the costs
related to the permit, monitoring, and inspection program, including
the small business stationary source technical and environmental
compliance assistance program required pursuant to the Federal Clean
Air Act Amendments of 1990, sections 502 and 507.'' The State Auditor
will also audit the program according to the supplemental letter.
Section 70.4(b)(8)(v) requires the permitting authority to submit
an estimate of the permit program costs for the first four years after
approval, and a description of how the state plans to cover those
costs. The IDNR provided an estimate that adequately satisfies the
four-year projection requirement if the $24 fee is maintained. A new
forecast will be required if the fee is reduced.
4. Provisions Implementing the Requirements of Other Titles of the Act
a. Acid rain. The legal requirements for approval under the Title V
operating permits program for a Title IV program were cited in EPA
guidance distributed on May 21, 1993, entitled ``Title V--Title IV
Interface Guidance for States.'' Iowa has met the five major criteria
of this guidance which include legal authority, regulatory authority,
forms, regulatory revisions, and a commitment to acid rain deadlines.
Iowa developed acid rain rules based on a model state acid rain rule
described in guidance issued by the EPA in May 1993.
The EPA's Acid Rain Division has identified necessary rule changes
in its January 27, 1994, review of the state's program. The state has
committed to make these changes in its supplemental letter.
b. Section 112. The state has demonstrated adequate authority to
adopt section 112 standards and other requirements in a timely manner.
The specific Title V program approval criteria with respect to section
112 provisions are enumerated in a memorandum from John Seitz, Office
of Air Quality Planning and Standards, dated April 13, 1993. Iowa has
met these criteria as described in the following topics:
(1) Section 112(d), (f), and (h).--EPA Emissions Standards. In
accordance with Part 70, Iowa will not issue any permit (or permit
revision addressing any emissions unit subject to a newly promulgated
section 112 standard) unless it would ensure compliance with all
applicable section 112 standards. Additionally, Part 70 permits will be
reopened which have three or more years remaining before their
expiration date to incorporate any newly promulgated standard (section
70.7(f)(1)(i)).
(2) Section 112(g)--The EPA has issued an interpretive notice on
February 14, 1995 (60 FR 8333), which outlines EPA's revised
interpretation of 112(g) applicability. The notice postpones the
effective date of 112(g) until after EPA has promulgated a rule
addressing that provision. The notice sets forth in detail the
rationale for the revised interpretation.
The section 112(g) interpretive notice explains that EPA is still
considering whether the effective date of section 112(g) should be
delayed beyond the date of promulgation of the Federal rule so as to
allow states time to adopt rules implementing the Federal rule, and
that EPA will provide for any such additional delay in the final
section 112(g) rulemaking. Unless and until EPA provides for such an
additional postponement of section 112(g), Iowa must have a Federally
enforceable mechanism for implementing section 112(g) during the period
between [[Page 20469]] promulgation of the Federal section 112(g) rule
and adoption of implementing Federal regulations.
The EPA is aware that Iowa lacks a program designed specifically to
implement section 112(g). However, Iowa has proposed rule 22.3(6) that
gives the state authority to limit emissions of HAPs. Iowa may use this
authority to establish case-by-case MACTs as needed for the review of
new or modifed hazardous air pollutant sources until such time as they
adopt 112(g).
(3) Section 112(i)(5)--Early Reductions. Since the state has
elected not to adopt the November 29, 1992, early reduction rule by
reference, the state will need to submit a delegation request and
demonstration, pursuant to 40 CFR Part 63, Subpart E, in order for EPA
to delegate authority to the state for implementation and enforcement
of the Federal early reduction program.
(4) Section 112(j)--Case-by-case MACT Hammer. It is the agency's
intent to make case-by-case MACT determinations and to issue permits to
subject sources in accordance with the 112(j) requirements.
(5) Section 112(l)--State Air Toxics Programs. Requirements for
approval, specified in 40 CFR Sec. 70.4(b), encompass section 112(l)(5)
approval requirements 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, the EPA
is proposing to grant approval under section 112(l)(5) and 40 CFR part
63.91 to Iowa for its program mechanism for receiving delegation of all
existing and future section 112(d) standards for both part 70 and non-
part 70 sources, and section 112 infrastructure programs, that are
unchanged from Federal rules as promulgated. In addition, EPA is also
proposing delegation of all existing standards and programs under CFR
parts 61 and 63 for part 70 and non-part 70 sources.
Iowa has informed the EPA that it intends to accept delegation of
section 112 standards through adoption by reference. The details of
this delegation mechanism will be set forth in an implementation
agreement between the state and EPA, to be implemented upon program
approval.
(6) Section 112(r)--Accidental Release Plans. The agency has
provided for the section 112(r) requirements in its rules. These rules
specifically state that if any source is required to develop and
register a risk management plan, the permit shall state the requirement
for submission of the plan to the IDNR. This rule also requires that an
annual certification be filed with the IDNR that the plan is being
properly implemented.
Finally, for sources failing to make the required risk management
plan submittal, Iowa rule 22.105(2)h(3)2 states that the permit
application shall include a compliance schedule for sources that are
not in compliance with all applicable requirements at the time of
permit issuance.
B. Options for Approval/Disapproval and Implications
The EPA is proposing to grant interim approval for two years to the
operating permits program submitted by the state of Iowa on November
15, 1993. In order to receive full approval, the state must adopt and
submit to the EPA the rule changes identified above within 18 months of
receiving full approval. Specifically, the state must amend the
following rules for consistency with part 70:
(1) IAC Sec. 22.101 pertaining to nonmajor sources which are not
exempted from future section 112 standards;
(2) IAC Sec. 22.102 and Sec. 103 pertaining to insignificant
activities and exempt sources;
(3) IAC Sec. 22.105 pertaining to permit revisions prior to
commencing construction;
(4) IAC Sec. 22.110 pertaining to section 502(b)(10) changes.
The state must also finalize its operating permit fee and submit a
revised fee demonstration as necessary. And, the state must either hire
the originally forecasted amount of personnel to implement the Title V
program or provide a revised workload analysis that adequately
describes how the program may be successfully implemented with fewer
personnel.
Finally, the state must correct its acid rain regulations to be
consistent with EPA's rules as discussed in the technical support
document.
Requirements for approval, specified in 40 CFR Sec. 70.4(b),
encompass section 112(l)(5) approval requirements for delegation of
section 112 standards as promulgated by EPA as they apply to part 70
sources. Section 112(l)(5) requires that the Iowa program contain
adequate authorities, adequate resources for implementation, and an
expeditious compliance schedule, which are also requirements under part
70. Therefore, the EPA is also proposing to grant approval, under
section 112(l)(5) and 40 CFR 63.91, to Iowa for its program mechanism
for receiving delegation of all existing and future section 112(d)
standards for both part 70 and non-part 70 sources, and infrastructure
programs under section 112 that are unchanged from Federal rules as
promulgated. In addition, EPA proposes to delegate existing standards
under 40 CFR parts 61 and 63 for both part 70 and non-part 70 sources.
The scope of Iowa's part 70 program that EPA proposes to approve in
this notice would apply to all part 70 sources as defined in the
approved program within Iowa.
III. Administrative Requirements
A. Request for Public Comments
Copies of Iowa'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 rulemaking. 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
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.
IV. Miscellaneous
A. Proposed Rulemaking Action
List of Subjects in 40 CFR Part 70
Environmental protection, Air pollution control, Intergovernmental
relations, Operating permits, Reporting and recordkeeping requirements.
Authority: 42 U.S.C. 7401-7671q.
Dated: April 3, 1995.
Dennis Grams,
Regional Administrator.
[FR Doc. 95-10244 Filed 4-25-95; 8:45 am]
BILLING CODE 6560-50-P
