[Federal Register Volume 59, Number 116 (Friday, June 17, 1994)]
[Unknown Section]
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From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-14816]
[[Page Unknown]]
[Federal Register: June 17, 1994]
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POSTAL SERVICE
ENVIRONMENTAL PROTECTION AGENCY
40 CFR Part 70
[AD-FRL-5000-2]
Clean Air Act Disapproval of Operating Permits Program;
Commonwealth of Virginia
AGENCY: Environmental Protection Agency (EPA).
ACTION: Proposed disapproval.
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SUMMARY: EPA is proposing to disapprove the Operating Permits Program
submitted by the Commonwealth of Virginia 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. The reasons for proposing
disapproval are as follows: Virginia's program does not contain the
necessary legal authority to afford judicial review to persons who have
participated in the public comment process, and it also does not
contain the necessary legal authority to prevent default issuance of a
permit. The submitted regulations have an expiration date of June 28,
1994 and cannot be applied or enforced after that date. Also, the
regulatory portion of the program does not include the proper universe
of sources required to be subject to a state operating permit program
or ensure that permits contain all applicable requirements, or
correctly delineating provisions enforceable only by the Commonwealth.
In addition, there are other deficiencies in Virginia's submitted
program, as specified in the Technical Support Document, which must be
corrected before EPA can grant full approval to Virginia's operating
permits program.
DATES: Comments on this proposed action must be received in writing by
July 18, 1994.
ADDRESSES: Comments should be mailed to Thomas J. Maslany, Director,
Air, Radiation & Toxics Division at the Region III address.
A copy of Virginia's submittal and other supporting information
used in developing the proposal are contained in the docket and
available for inspection during normal business hours at the following
location: EPA Region III, Air, Radiation & Toxics Division, 841
Chestnut Building, Philadelphia, PA 19107.
FOR FURTHER INFORMATION CONTACT: Lisa M. Donahue, Environmental
Scientist, at the Region III address, or call 215-597-9781.
SUPPLEMENTARY INFORMATION:
I. Background
A. Introduction
As required under title V of the Clean Air Act (``CAA''), 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 CAA requires that states develop and submit these programs to
EPA by November 15, 1993, and that EPA take actions 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 CAA and
40 CFR part 70, which together outline criteria for approval or
disapproval. Where a program substantially, but not fully, meets the
requirements of 40 CFR 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 November 15, 1995, or by the end of an interim program
period, it must establish and implement a Federal operating permits
program.
On November 12, 1993, Virginia submitted an operating permits
program for review by EPA. It was received by EPA on November 19, 1994.
The submittal was supplemented by a letter dated January 14, 1994, and
was found to be administratively complete pursuant to 40 CFR
70.4(e)(1). The submittal contains a program description, a legal
opinion from the Virginia Attorney General, confirmation of regulatory
authority, program and fee regulations, relevant portions of Virginia
statutes, guidance and forms, a description of enforcement provisions,
a resource and fee demonstration, and a transition plan.
B. Federal Oversight and Sanctions
Sanctions must be imposed 18 months after EPA disapproves a state
submittal, unless prior to expiration of the 18-month period the state
submits a revised program that EPA approves. If a state has not
submitted a revised program that EPA approves within 6 months after EPA
applies the first sanction, a second sanction is required. In addition,
discretionary sanctions may be applied any time during the 18-month
period following the date required for program submittal or the date of
program disapproval. If the Commonwealth does not have an approved
program by November 15, 1995, EPA must promulgate, administer, and
enforce a Federal operating permits program for the Commonwealth.
II. Summary and Analysis of State Submission
The analysis contained in this document focuses on the major
portions of Virginia's submittal and particularly portions which must
be corrected to meet the minimum requirements of 40 CFR part 70. The
full program submittal, the Technical Support Document, and other
relevant materials are available for detailed information as part of
the public docket. The docket may be viewed during regular business
hours at the address listed above.
A. Statutory Authority
1. Standing for Judicial Review
The Attorney General of the Commonwealth, in his opinion dated
November 5, 1993, states that ``the laws of the Commonwealth provide
adequate authority to carry out all aspects of the Commonwealth's
program for Federal operating permits.'' The Attorney General cites Va.
Code section 10.1-1318(B) as providing an opportunity for judicial
review to any person who is aggrieved by a final decision of the State
Air Pollution Control Board and who meets certain criteria, including
having an immediate, pecuniary, and substantial interest. The
requirement for standing for judicial review, as specifically required
by section 502(b)(6) of the CAA and 40 CFR 70.4(b)(3)(x), must provide
standing for any person who has participated in the public comment
process and any other person who could obtain judicial review of that
action under applicable law. EPA interprets section 502(b)(6) of the
CAA as requiring that title V permits programs must provide judicial
review to any party who participated on the public comment process and
who at a minimum meets the threshold standing requirements of Article
III of the U.S. Constitution.
In comparison, Section 10.1-1318(B) of the Code of Virginia extends
the right to seek judicial review only to persons who have suffered an
``actual, threatened, or imminent injury...'' where ``such injury is an
invasions of an immediate, legally protected, pecuniary and substantial
interest which is concrete and particularized...'' The Virginia
statute, as well Virginia case law does not enable a party who meets
the minimum threshold standing requirements of Article III of the U.S.
Constitution access to the Commonwealth's court system. The
Commonwealth's Attorney General's opinion submitted with Virginia's
program states that ``the inclusion of the word 'pecuniary' in the
amended Virginia law means the requirement for standing to obtain
judicial review may be more stringent than Article III standing
requirements, as the EPA interprets them under the United States
Supreme Court decision in Lujan v. Defenders of Wildlife, 112 S.Ct.
2130, 2136 (1992) and related cases.''
The limitations on judicial review in Virginia do not meet the
minimum threshold standing requirements of Article III of the U.S.
Constitution and thus do not meet the minimum program approval criteria
under title V. Therefore, EPA is proposing to disapprove Virginia's
program because it does not meet the minimum requirement for standing
for judicial review. Va. Code section 10.1-1318(B) must be amended.
2. Default Issuance of Permits
Va. Code section 9-6.14:3 provides that the purpose of Virginia's
Administrative Process Act is to supplement present and future basic
laws. Although Regulations sections 120-08-0525 C and E provide for EPA
veto and affected states review, these regulations may be superseded by
the Administrative Process Act. Sections 9-6.14:11 and 9-6.14:12 of the
Administrative Process Act provide that a party may provide written
notice to the agency that a decision on a permit is due, and that the
decision is deemed in favor of the named party if no decision is
reached within 30 days. This provision prevents the Commonwealth from
meeting the requirement of section 505(b)(3) of the CAA that no permit
be issued unless it is revised to meet the objection of EPA, if EPA
objects to the permit within 45 days after receiving a copy of the
proposed permit. This provision also prevents the Commonwealth from
meeting Sec. 70.8(e), which requires the Attorney General to certify
that no provision of state law requires that a permit be issued after a
certain time if the permitting authority has failed to take action on
the application. Virginia must ensure that no permit will be issued by
default through this process until affected states and EPA have had a
chance to review the proposed permit as required by 40 CFR 70.8. In
addition Virginia must ensure that no permit will be issued through
this process if EPA has objected within 45 days. EPA is proposing to
disapprove Virginia's program because it does not ensure that EPA and
affected states are given an adequate opportunity for review of
proposed permits and that no permit will be issued if EPA objects.
B. Regulations and Program Implementation
1. Effectiveness and Enforceability of Rules
The Virginia operating permit program Regulations for the Control
and Abatement of Air Pollution (Regulations) Emergency Rule 8-5,
Federal Operating Permits for Stationary Sources, and Emergency Rule 8-
6, Permit Program Fees, do not meet the requirements of 40 CFR part 70.
Although the rules are currently effective, they expire on June 28,
1994 and cannot be implemented or enforced beyond that date. EPA is
proposing to disapprove Virginia's program because its regulations
expire on June 28, 1994.
2. Applicability Under the Operating Permits Program
a. Definitions and Exemptions. The requirements of Sec. Sec. 70.2
and 70.3 for applicability have not been met. Primarily, Virginia's
regulations at section 120-08-0502 and section 120-08-0602 do not
correctly define major source or stationary source. Virginia's
definitions, and the exemptions of insignificant activities and
affected sources found in section 120-08-0501 of Virginia's regulations
limit the universe of sources that are applicable to Rule 8-5 by
exempting or deferring sources that are required by 40 CFR part 70 to
obtain an operating permit. EPA is proposing to disapprove Virginia's
program because the regulations do not apply to the proper universe of
sources. Further discussion of these deficiencies is contained in the
Technical Support Document.
b. Variances. Virginia has the authority to issue a variance from
requirements imposed by Virginia law. The variance provision at Va.
Code section 10.1-1307.C. empowers the Air Pollution Control Board,
after a public hearing, to grant a local variance from any regulation
adopted by the board. EPA regards this provision as wholly external to
the program submitted for approval under 40 CFR part 70, and
consequently is proposing to take no action on this provision of
Virginia law. EPA has no authority to approve provisions of state law,
such as the variance provision referred to, which are inconsistent with
the CAA. EPA does not recognize the ability of a permitting authority
to grant relief from the duty to comply with a federally enforceable
permit, except where such relief is granted through procedures allowed
by 40 CFR part 70. EPA reserves the right to enforce the terms of the
permit where the permitting authority purports to grant relief from the
duty to comply with a permit in a manner inconsistent with 40 CFR part
70 procedures.
3. Applicable Federal Requirements and Federally Enforceable Provisions
Virginia's submittal does not ensure the Commonwealth's ability to
issue permits which include all applicable Federal requirements and
which correctly delineate requirements that are enforceable only by
Virginia. The Commonwealth also cites Virginia's regulations rather
than Federal regulations (in the form of federally promulgated
regulations or state regulations that have been approved into the State
Implementation Plan) in the definitions in section 120-08-0502. In
section 120-08-0507, Federal enforceability is incorrectly extended to
portions of Virginia's regulations that have been submitted, but not
yet approved, into the State Implementation Plan.
EPA is proposing to disapprove Virginia's program because it
explicitly purports to extend Federal enforceability to provisions
which are not enforceable by the administrator and also does not
include certain provisions which must be considered federally
enforceable (and thus applicable) requirements.
4. Public Participation and Affected State Review
Virginia uses the term ``locality particularly affected'' in
determining the geographic scope of notification to the public of a
public comment period on a draft permit. This scope is too narrow and
it does not fully meet the requirements of 40 CFR 70.7(h) for public
participation. For full approval, Virginia must ensure that any
locality that could potentially be affected by a permit would be
notified of the opportunity for public comment on that permit. In
addition, Virginia incorrectly exempts minor permit modifications from
the requirement under Sec. 70.8(b)(2) for affected state review of
those modifications. Virginia must also correct this deficiency before
EPA can grant full approval to Virginia's program.
C. Permit Fees and Demonstration
Va. Code section 10.1-1322.1 and Rule 8-6 allow for a fee rate of
up to $25 per ton, as adjusted by the consumer price index (CPI), of
emissions to be charged to a source. The fee is set by the Air
Pollution Control Board and can be adjusted annually, without exceeding
the statutory cap, to meet the costs of implementation of the program.
Virginia's fee revenue projections are based on revenues from a $25 per
ton fee, using 1990 as a base year, and adjusted annually by the CPI,
as set out in Section 502 of the CAA. However, no specific fee schedule
was included in the submittal and the cap on the fee amount limits the
Board's flexibility in ensuring that revenues are sufficient to cover
the direct and indirect costs of the program. (CAA section 502(b)(3)(A)
and Va. Code section 10.1-1322. B.) Va. Code section 10.1-1322. B.
precludes the Commonwealth from collecting title V fees to cover the
indirect costs charged and collected by the Commonwealth's Department
of Accounts. This provision violates 40 CFR 70.9(b).
The fee amounts projected by Virginia in the ``Total Fee Revenue
Projections'' table, although sufficient to cover the estimated costs
of the program (as set out in the resource demonstration), do not
accurately reflect the mandate of Va. Code section 10.1-1322.1 to
adjust fees using the CPI calculation method stipulated in CAA section
502. Also, it is unclear whether or not the estimated emissions used in
the ``Total Fee Revenue Projections'' table include emissions from acid
rain sources, which Virginia exempts from fees in the years 1995 to
1999 (section 120-08-0601 C.5.) or includes Hazardous Air Pollutants.
In order for EPA to grant full approval to Virginia's program, the
Commonwealth must remove the statutory impediment to using permit fees
to fund certain indirect costs of its program and ensure that the
Commonwealth's fee provision comply with 40 CFR part 70.
D. Provisions Implementing the Requirements of Other Titles of the CAA
1. Authority and Commitments for Section 112 Implementation
In Va. Code section 10.1-1322.A. and Rule 8-5, Virginia has
demonstrated broad legal authority to incorporate into permits and
enforce all applicable CAA section 112 requirements. However, Virginia
also indicated that additional authority may be necessary to conduct
specific section 112 activities, and did not commit to implementing CAA
section 112(r) for prevention of accidental release. Virginia
supplemented its broad legal authority with a commitment to ``develop
the state regulatory provisions as necessary to carry out these
programs and the responsibilities under the delegation after approval
of the operating permit program and EPA has issued the prerequisite
guidance for development of these title III programs.'' Also, Virginia
has the authority under section 120-08-0505 K to require that an
applicant state that the source has complied with CAA section 112(r) or
state in the compliance plan that the source intends to comply and has
set a schedule to do so. In the case of CAA section 112(g)
requirements, EPA notes that Virginia must begin to implement this
program upon approval of an operating permits program.
2. Authority and Commitments for Implementation of Acid Rain
Requirements
Virginia has committed to adopting regulations to meet the
requirements of the Acid Rain program by January 1, 1995. The Attorney
General, in his November 5, 1993 opinion, committed to including a
statutory and regulatory analysis of the acid rain portions of the
operating permits program in the January 1, 1995 submittal. Virginia
has begun its regulatory development process to adopt regulations for
the acid rain portion of the Virginia Operating Permits Program.
III. Request for Public Comments
EPA is soliciting public comments on the issues discussed in this
document or on other relevant matters. These comments will be
considered before taking final action. Interested parties may
participate in this Federal rulemaking action by submitting written
comments to the EPA Regional office listed in the Addresses section of
this document. EPA has received a petition from the Environmental
Defense Fund, dated December 23, 1993, to disapprove Virginia's
operating permits program. This petition will be included in the docket
and will be considered in EPA's final action.
Proposed Action
EPA is proposing to disapprove the operating permits program
submitted by the Commonwealth on November 12, 1993. If promulgated,
this disapproval will constitute a disapproval under section 502(d) of
the CAA (see generally 57 FR 32253-32254). As provided under section
502(d)(1) of the CAA, the Commonwealth will have up to 180 days from
the date of EPA's notification of disapproval for the Governor of
Virginia to revise and resubmit the program. EPA is proposing to
disapprove this program on the basis that Virginia has not met the
following five requirements:
1. Pursuant to section 502(b)(6) of the CAA and 40 CFR 70.4(b)(3)(x)
and 70.7(h), adequate provisions for public participation in the
permit process, including statutory authority that meets the minimum
threshold for judicial standing.
2. Pursuant to section 505(b)(3) of the CAA and 40 CFR 70.8(e),
authority to prevent default issuance of permits.
3. Regulations that expire on June 28, 1994.
4. Issuance of permits to the proper universe of sources required by
40 CFR part 70 to be included in the Commonwealth's operating permit
program.
5. Regulations that meet the requirements of 40 CFR part 70 ensuring
issuance of permits that contain all applicable Federal requirements
and correctly delineate provisions only enforceable by the
Commonwealth.
Virginia must amend its program to correct the deficiencies and
resubmit all relevant portions of the program, including a revised
Attorney General's opinion. The Technical Support Document discusses
Virginia's submittal in detail, and contains specific references to
revisions and modifications necessary to obtain full approval.
Submittal of revised portions of Virginia's operating permit program,
including revised statutes and regulations, will undergo additional
notice and comment in the Federal Register before EPA takes final
action on the program submittal, if those revised portions are received
before November 19, 1994. November 19, 1994 is one year from the date
of receipt of the submittal and the date by which EPA is required under
40 CFR 70.4(e) to take final action on the current submittal.
The Commonwealth of Virginia must submit a corrected program within
180 days following final EPA disapproval of the program. If Virginia
fails to submit a fully approvable whole part 70 program, or a required
revision thereto, in conformance with the provision of 40 CFR 70.4, EPA
may, at any time, apply one of the sanctions specified in section
179(b) of the Act. Sanctions must be imposed 18 months after EPA
disapproves a state's submittal.
The Office of Management and Budget (OMB) has exempted this action
from Executive Order 12866 review.
Under the Regulatory Flexibility Act, 5 U.S.C. 600 et seq., EPA
must prepare a regulatory flexibility analysisassessing the impact of
any proposed or final rule on small entities. 5 U.S.C. 603 and 604.
Alternatively, EPA 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.
EPA's disapproval of the State request under section 502 of the CAA
does not affect any existing requirements applicable to small entities.
Any pre-existing Federal requirements remain in place after this
disapproval. Federal disapproval of the State submittal does not affect
its state-enforceability. Moreover, EPA's disapproval of the submittal
does not impose any new Federal requirements. Therefore, EPA certifies
that this disapproval action does not have a significant impact on a
substantial number of small entities because it does not impose any new
Federal requirements.
The Regional Administrator's decision to approve or disapprove
Virginia's operating permits program will be based on whether it meets
the requirements of title V of the Clean Air Act, as amended, and EPA
regulations in 40 CFR part 70.
Authority: 42 U.S.C. 7401-76719.
Dated: May 5, 1994.
Stanley L. Laskowski,
Acting Regional Administrator.
[FR Doc. 94-14816 Filed 6-16-94; 8:45 am]
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