02-19323. State Program Requirements; Application To Administer the National Pollutant Discharge Elimination System (NPDES) Program; Arizona

AGENCY:

Environmental Protection Agency (EPA).

ACTION:

Notice.

SUMMARY:

The State of Arizona has submitted a request for approval of the Arizona Pollutant Discharge Elimination System (AZPDES) program pursuant to section 402(b) of the Clean Water Act (CWA or “the Act”). With this request, the Arizona Department of Environmental Quality (ADEQ) seeks approval to administer a partial program for discharges of pollutants into waters of the United States under its jurisdiction. Today, EPA Region 9 is providing public notice of Arizona's request for AZPDES program approval and of both a public hearing and public comment period on the State's program approval submission. EPA will either approve or disapprove the State's request after considering all comments it receives.

DATES:

Comments The public comment period on the State's request for approval to administer the proposed AZPDES program will be from the date of publication until September 16, 2002. Comments must be received or post-marked by no later than midnight on September 16, 2002. Public Hearing. A public hearing will be held on September 4, 2002.

ADDRESSES:

Comments Send all paper copy comments to: Mr. Matthew Mitchell (WTR-5), Water Division, EPA Region 9, 75 Hawthorne Street, San Francisco, CA , 94105. Comments may also be submitted electronically to the following e-mail address: [e-mail].

Electronic comments should be identified by the docket number. EPA requests that electronic comments also include the commentor's postal mailing address. No Confidential Business Information (CBI) should be submitted through e-mail. Comments and data will also be accepted on disks in WordPerfect 8.0 format or ASCII file format.

A copy of each comment should be submitted to: Mr. Chris Varga, Federal Permits Unit, Arizona Department of Environmental Quality, 1110 W. Washington St., Phoenix, AZ 85007.

Public comments may be in either paper or electronic format. If submitting comments in paper format, please submit the original and three copies of your comments and enclosures (including references). To ensure that EPA can read, understand and therefore properly respond to comments, the Agency would prefer that comments be typed or legibly written and that commentors cite the paragraph(s) or sections in the notice or supporting documents to which each comment refers. Commentors who want EPA to acknowledge receipt of their comments should enclose a self-addressed stamped envelope.

Public Hearing. The public hearing will be held at the Best Western Executive Park Hotel, 1100 N. Central Ave., Phoenix, Arizona, beginning at 1 p.m. on September 4. The public hearing will be conducted in accordance with 40 CFR 124.12, and will provide interested parties with the opportunity to provide written and/or oral comments for the official record.

Viewing/Obtaining Copies of Documents Copies of Arizona's AZPDES program approval submission (referred to throughout this notice as Arizona's “application”) and all other documents in the official record are available for inspection from 9 am to 4 pm, Monday through Friday, excluding legal holidays, at EPA Region 9, 12th floor Water Division, 75 Hawthorne St., San Francisco, CA 94105.

A copy of Arizona's AZPDES application is also available for inspection from 8 am to 5 pm, Monday through Friday, excluding State holidays, at the Arizona Department of Environmental Quality, Records Management Center, 1110 W. Washington St. , Phoenix, AZ 85007. Please call [phone] to set up an appointment.

Copies of the entire State AZPDES program submission are available in paper format. Part or all of the State's application may be copied at the ADEQ office in Phoenix, or the EPA's office in San Francisco, at a minimal cost per page.

Copies of the documents available in electronic format are accessible on the Internet at the ADEQ web page at http://www.adeq.state.az.us/​environ/​water/​permits/​federal.html

Every effort has been made to include each document relevant to EPA's decision on this matter in the official record. EPA invites input from the public on any document that the public feels should have been included in the official record, but has not been.

FOR FURTHER INFORMATION CONTACT:

Mr. Matthew Mitchell at the EPA address listed above or by calling [phone], e-mail: [e-mail] or Mr. Chris Varga at the ADEQ address listed above or by calling [phone], e-mail: [e-mail].

SUPPLEMENTARY INFORMATION:

Section 402 of the CWA created the NPDES program under which EPA may issue permits for the point source discharge of pollutants to waters of the United States under conditions required by the Act. Section 402(b) requires EPA to authorize a State to administer an equivalent state program, upon the Governor's request, provided the State has appropriate legal authority and a program sufficient to meet the Act's requirements.

The regulatory requirements for state program approval are set forth in 40 CFR part 123. 40 CFR 123.21 lists the basic elements of an approvable application. EPA Region 9 considers the documents submitted by the State of Arizona administratively complete at the time of this document. EPA will not make a final decision on AZPDES program approval until after: (1) Considering all public comments provided during the public comment period or at the public hearing; (2) completion of the ongoing consultations with the U.S. Fish and Wildlife Service on effects program approval may have on endangered or threatened species and their designated critical habitat; and (3) completion of ongoing consultations with the State Historic Preservation Officer on effects program approval may have on historic properties or sites listed or eligible for listing in the National Register of Historic Places.

By letter dated December 20, 2001, the Governor of Arizona requested NPDES program approval and submitted a program description (including funding, personnel requirements and organization, and enforcement procedures), an Attorney General's statement, copies of applicable State statutes and regulations, and a Memorandum of Agreement (MOA) to be executed by the Regional Administrator of EPA Region 9 and the Director of ADEQ. EPA received this package of materials on January 14, 2002. EPA Region 9 determined that Arizona's approval request did not constitute a complete package under 40 CFR 123.21, and notified the Director of the Water Quality Division of ADEQ in writing on February 15, 2002. By letter of June 5, 2002, the Governor of Arizona requested NPDES partial program approval and submitted an amended program description, amended Attorney General's Statement, amended Arizona statute and rules, and an MOA. EPA received this package of materials on June 11, 2002. EPA Region 9 determined that the approval request received on June 11, 2002, along with supplements received on July 8 and July 10 constituted a complete package under 40 CFR 123.21, and a letter of completeness was sent to the Director of ADEQ on July 11, 2002.

EPA is required to approve the submitted program within 90 days of submission of the complete information unless it does not meet the requirements of section 402(b) of the Act and EPA regulations, or EPA and ADEQ jointly agree to extend this deadline. (See 40 CFR 123.21(d)). To obtain such approval, the State must show, among other things, that it has authority to issue permits which comply with the Act, authority to impose civil and criminal penalties for permit violations, and authority to ensure that the public is given notice and opportunity for a hearing on each proposed permit. After close of the comment period and completion of the required consultations with other federal agencies, the Regional Administrator for EPA Region 9 will make a decision to approve or disapprove the AZPDES program for implementation by the State.

EPA's final decision to approve or disapprove the AZPDES program will be based on the requirements of section 402 of the CWA and 40 CFR part 123. EPA is also required by the Endangered Species Act (ESA) and the National Historic Preservation Act to consult with other federal agencies before making a final decision in this matter. For example, the ESA requires federal agencies to consult with the U.S. Fish and Wildlife Service on the effects of federal actions on endangered species. EPA has determined that its action on the AZPDES program application constitutes a federal action that is subject to section 7 of the ESA. Section 7(a)(2) of the ESA places a statutory requirement (separate and distinct from CWA section 402(b)) for EPA to “* * * insure that any action authorized, funded or carried out [by EPA]* * * is not likely to jeopardize the continued existence of any endangered species or threatened species or result in the destruction or adverse modification of habitat * * * determined to be critical * * *. ” EPA Region 9 initiated formal consultation under section 7 of the ESA on June 21, 2002. EPA's responsibilities under ESA, as well as under the National Historic Preservation Act are discussed in more detail later in this notice. Under federal law, EPA may not make a final decision on AZPDES program approval until consultation under these acts are completed; therefore, it may be necessary to seek ADEQ's agreement on an extension of the 90 day approval deadline.

If EPA approves the Arizona partial program, the Regional Administrator will so notify the State and will sign the proposed MOA. Notice will be published in the Federal Register and, as of the date of program approval, EPA will transfer to the ADEQ NPDES permitting authority and primary enforcement responsibility for those discharges subject to the AZPDES program, with certain exceptions, which are discussed below under Scope, Transfer of NPDES Authority, and Summary of the AZPDES Permitting Program. If EPA's Regional Administrator disapproves the AZPDES program, the ADEQ will be notified of the reasons for disapproval and of any revisions or modifications to the program which are necessary to obtain approval.

Public Hearing Procedures

The following procedures will be used at the public hearing:

1. The Presiding Officer shall conduct the hearing in a manner which will allow all interested persons wishing to make oral statements an opportunity to do so; however, the Presiding Officer may inform attendees of any time limits during the opening statement of the hearing.

2. Any person may submit written statements or documents for the record.

3. The Presiding Officer may, in his discretion, exclude oral testimony if such testimony is overly repetitious of previous testimony or is not relevant to the decision to approve or require revision of the submitted State program.

4. The transcript taken at the hearing, together with copies of all submitted statements and documents, shall become a part of the record submitted to the Regional Administrator.

5. The hearing record shall be left open until the deadline for receipt of comments specified at the beginning of this Notice to allow any person time to submit additional written statement or to present views or evidence tending to rebut testimony presented at the public hearing.

6. Hearing statements may be oral or written. Written copies of oral statements are urged for accuracy of the record and for use of the Hearing Panel and other interested persons. Persons wishing to make oral testimony supporting their written comments are encouraged to summarize their points rather than reading lengthy written comments verbatim into the record. All comments received by EPA Region 9 by the deadline for receipt of comments, or presented at the public hearing, will be considered by EPA before taking final action on the Arizona request for NPDES program approval.

Scope, Transfer of NPDES Authority, and Summary of the AZPDES Permitting Program

A. Scope of the Partial Program

The proposed AZPDES program is a partial program which conforms to the requirements of section 402(n)(3) of the CWA. ADEQ's application for program approval applies to all discharges covered by the authority of that agency. This includes most discharges of pollutants subject to the federal NPDES program (e.g., municipal wastewater and storm water point source discharges, pretreatment, industrial wastewater and storm water point source discharges, and point source discharges from federal facilities).

The ADEQ has authority to regulate discharges from industrial facilities covered by all Standard Industrial Classification (SIC) codes. The ADEQ has authority to regulate discharges of storm water associated with industrial activity and discharges of storm water from municipal separate storm sewer systems. The ADEQ has primary responsibility for implementing a Pretreatment Program. The ADEQ has authority to regulate discharges from publicly owned and privately owned treatment works and for discharges from concentrated animal feeding operations (CAFOs) within the ADEQ's jurisdiction.

ADEQ is not seeking the authority to regulate the disposal of sewage sludge (in accordance with section 405 of the Act and 40 CFR part 503). EPA will retain NPDES permitting authority and primary enforcement responsibility over the sewage sludge program. ADEQ is planning to apply for this authority in the future.

ADEQ does not have, and is not seeking, the authority to regulate discharges in Indian Country (as defined in 18 U.S.C. 1151). EPA will retain NPDES permitting authority and primary enforcement responsibility in Indian Country in Arizona.

B. Transfer of NPDES Authority and Pending Actions

Upon approval of the AZPDES program, authority for all NPDES permitting activities, as well as primary responsibility for NPDES enforcement activities, within the scope of ADEQ's jurisdiction, would be transferred to the State, with some exceptions. These exceptions would be agreed to by EPA and the State under the MOA that would be signed upon program approval, and are explained below. In addition to the exceptions listed below, EPA would retain on a permanent basis its authority under section 402(d) of the CWA to object to AZPDES permits proposed by ADEQ, and if the objections are not resolved, to issue federal NPDES permits for those discharges. EPA would also retain on a permanent basis its authority under sections 309 and 504 of the CWA to file federal enforcement actions.

1. Permits Already Issued by EPA

40 CFR 123.1(d)(1) provides that EPA retains jurisdiction over any permit that it has issued unless the State and EPA have reached agreement in the MOA for the State to assume responsibility for that permit. The proposed MOA between EPA and the ADEQ provides that the ADEQ would assume at the time of program approval permitting authority and primary enforcement responsibility over all NPDES permits issued by EPA prior to program approval, with the following exceptions:

a. Jurisdiction over those discharges covered by permits already issued by EPA, but for which evidentiary hearings have been requested or an appeal taken prior to AZPDES program approval. Jurisdiction over these discharges, including primary enforcement responsibility (except as provided by paragraph 3 below-Active Federal Enforcement Cases), would be transferred to the State once the evidentiary hearing request or appeal has been resolved.

2. Permits Pending With EPA at Time of AZPDES Program Approval

If the permittee requests, EPA may continue to process a NPDES permit application that is pending with EPA at the time of the AZPDES program approval. ADEQ will be responsible for final issuance for all permits after the program approval date. For permits for which an evidentiary hearing has been requested or an appeal taken at the time of program authorization, EPA will retain full jurisdiction until the matter has been resolved. Upon resolution of the administrative challenge, ADEQ will convert the NPDES permit to an AZPDES permit as specified in State rule.

3. Active Federal Enforcement Cases

For active Federal enforcement cases (administrative orders or formal referrals to the Department of Justice) at the time of program authorization, EPA will complete the enforcement action unless otherwise agreed to by EPA and ADEQ. As each EPA enforcement action is resolved, EPA will notify ADEQ and transfer any additional permit file material at that time. Resolution of an enforcement action may be accomplished by the permittee complying with the requirements of a compliance order, consent agreement or court order resulting from EPA enforcement action, withdrawal of the action by EPA, a court decision dismissing the action (in whole or in part) or, if agreed to by EPA, the imposition of an equivalent enforceable compliance schedule by ADEQ.

C. Summary of the Application Documents

The AZPDES program is fully described in documents the State has submitted in accordance with 40 CFR 123.21, which includes the following: a letter from the Governor requesting program approval; a Memorandum of Agreement (MOA) for execution by ADEQ and EPA; a Program Description, including an Enforcement Management System, outlining the procedures, personnel and protocols that would be relied on to run the State's permitting and enforcement programs; and a Statement signed by the Attorney General that describes the legal authority which the State has to administer a program equivalent to the federal NPDES program. The State's AZPDES application consists of a letter from the Governor of Arizona, enclosing four sections and associated appendices. The content of those documents is summarized below.

1. A Letter from the Governor

Arizona' application for program approval includes a letter dated June 5, 2002, from Governor Jane Dee Hull, officially requesting NPDES program approval.

2. The EPA/ADEQ MOA

The requirements for MOAs are found in 40 CFR 123.24. A Memorandum of Agreement is a document signed by each agency, committing them to specific responsibilities relevant to the administration and enforcement of the State's regulatory program. A MOA specifies these responsibilities and provides structure for the State's program management and EPA's program oversight.

The MOA submitted by the State of Arizona has been signed by Jacqueline E. Schafer, Director of the Arizona Department of Environmental Quality. The Regional Administrator of U.S. EPA Region 9 would sign the document only if the program has been determined approvable after all comments received during the comment period (including comments received at the public hearing) have been considered. The MOA submitted by ADEQ includes the following items:

Section I—General: This section contains general statements describing the purpose of the MOA.

Section II—Scope of Authorization: This section contains the statement of the scope of the NPDES program ADEQ would be administering.

Section III—Program Responsibilities: Lists the responsibilities of ADEQ and EPA in maintaining an effective program. Also outlines the procedures for transfer of authority over discharges over which EPA would be temporarily retaining authority and gives timing for the transition.

Section IV—Permit Review and Issuance: describes all agreements on the review and issuance of AZPDES permits. It covers ADEQ's responsibilities to issue permits, the transfer of EPA files to the State, and the State's application review and permit development process. Included are such things as procedures for permit modification or reissuance, and EPA's review of AZPDES drafted individual and general permits. This section includes the State's commitment for responding to public concerns and providing public participation in connection with public hearings, evidentiary hearings, and administrative and judicial enforcement actions.

Section V—Compliance and Enforcement: Describes summary agreements between EPA and ADEQ regarding EPA oversight of the AZPDES enforcement program. These include those commitments on ADEQ's compliance monitoring, reviews, pretreatment audits, and inspections.

Section VI—Pretreatment: Describes summary agreements between EPA and ADEQ regarding EPA oversight of AZPDES's implementation of the industrial pretreatment program regulating industrial users of municipal wastewater treatment plants.

Section VII—Sewage Sludge/Biosolids Management Program: Describes summary agreements between EPA and ADEQ regarding EPA oversight of AZPDES's regulation of the disposal of biosolids (sewage sludge) generated by wastewater treatment systems. (In the July 8 addendum to the MOA, ADEQ clarifies that it is not seeking EPA review of the Sewage Sludge/Biosolids Management Program at this time.)

Section VIII—Reporting and Transmittal of Information on AZPDES Regulated Facilities: This section describes how reports and requests for information would be handled; and how information is transferred between the two agencies.

Section IX—Program Review: Explains how EPA would periodically review the AZPDES program for implementation and continued consistency with Clean Water Act requirements.

Section X—Computation of Time: This section describes procedures to compute any periods of time prescribed within the MOA.

Section XI—Approval and Effective Date: This section states that the MOA would become effective on the date of program approval.

3. Program Description

A program description submitted by a State seeking program approval must meet the minimum requirements of 40 CFR 123.22. It must provide a narrative description of the scope, structure, coverage and processes of the State program; a description of the organization, staffing and position descriptions for the lead State agency; and itemized costs and funding sources for the program for the first two years after program approval. It must describe all applicable State procedures (including administrative procedures for the issuance of permits and administrative or judicial procedures for their review) and include copies of forms used in the program. It must further contain a complete description of the State's compliance and enforcement tracking program. The program description submitted by ADEQ includes the following:

I. Introduction

II. Scope of the Program

III. Organization and Structure

IV. Resources and Funding

V. Description of State Procedures

4. Attorney General's Statement

An Attorney General's Statement is required and described in regulations found at 40 CFR 123.23. The State Attorney General must certify that the State has lawfully adopted statutes and regulations which provide the State agency with the legal authority to administer a permitting program in compliance with 40 CFR part 123. The Arizona Attorney General's Statement describes and cites State legal authority it believes adequate to administer the AZPDES program; and certifies that the State has the legal authority to administer the AZPDES program in accordance with the regulations in 40 CFR part 123. The “Statements of the Attorney General” which was submitted by Arizona Attorney General Janet Neapolitan on June 10, 2002, supplemented on July 10, and formally resubmitted on July 12, constitutes the Attorney General's Statement required by section 402(b) of the CWA and 40 CFR 123.23 for the Purposes of the State's AZPDES application.

5. Arizona Statutes and Rules

This section contains a list of Arizona statutes and administrative regulations relevant to implementation and enforcement of the AZPDES program.

Public Comment on the Described Program

The program submitted by the State of Arizona has been determined by EPA to be complete in accordance with the regulations found at 40 CFR part 123. EPA and ADEQ want the citizens of Arizona to understand the proposed AZPDES program and encourage public participation in the decision making process. Therefore, EPA requests that the public review the program that ADEQ has submitted and provide any comments they feel are appropriate. EPA will consider all comments on the AZPDES program and/or its approval in its decision.

Other Federal Statutes

A. National Historic Preservation Act

Section 106 of the National Historic Preservation Act requires that all federal agencies consult with the State Historic Preservation Officer (SHPO) and the Advisory Council on Historic Preservation on all federal undertakings which may affect historic properties or sites listed or eligible for listing in the National Register of Historic Places. Regulations outlining the requirements of a section 106 consultation on a federal undertaking are found at 36 CFR part 800. The EPA is currently in discussions with the SHPO regarding its determination that approval of the State permitting program itself would have no effect on the preservation of historic properties within the State of Arizona.

B. Endangered Species Act

Section 7(a)(2) of the Endangered Species Act (ESA) requires that all federal agencies, in consultation with the U.S. Fish and Wildlife Service, insure that any actions they authorize, fund, or carry out are unlikely to jeopardize the continued existence of any listed species or result in the destruction or adverse modification of critical habitat. Regulations controlling consultation under ESA section 7 are codified at 50 CFR part 402. The approval of the State permitting program under section 402 of the Clean Water Act is a federal action subject to this requirement, but the State's subsequent AZPDES permit actions are not. EPA Region 9 initiated formal consultation with the U.S. Fish and Wildlife Service on June 21, 2002.

C. Regulatory Flexibility Act

Based on General Counsel Opinion 78-7 (April 18, 1978), EPA has long considered a determination to approve or deny a State NPDES program submission to constitute an adjudication because an “approval”, within the meaning of the APA, constitutes a “license,” which, in turn, is the product of an “adjudication”. For this reason, the statutes and Executive Orders that apply to rulemaking action are not applicable here. Among these are provisions of the Regulatory Flexibility Act (RFA), 5 U.S.C. 601 et seq. Under the RFA, whenever a Federal agency proposes or promulgates a rule under section 553 of the Administrative Procedure Act (APA), after being required by that section or any other law to publish a general notice of proposed rulemaking, the Agency must prepare a regulatory flexibility analysis for the rule, unless the Agency certifies that the rule will not have a significant economic impact on a substantial number of small entities. If the Agency does not certify the rule, the regulatory flexibility analysis must describe and assess the impact of a rule on small entities affected by the rule.

Even if the NPDES program approval were a rule subject to the RFA, the Agency would certify that approval of the State's proposed AZPDES program would not have a significant economic impact on a substantial number of small entities. EPA's action to approve an NPDES program merely recognizes that the necessary elements of an NPDES program have already been enacted as a matter of State law; it would, therefore, impose no additional obligations upon those subject to the State's program. Accordingly, the Regional Administrator would certify that this program, even if a rule, would not have a significant economic impact on a substantial number of small entities.

I hereby provide public notice of the application by the State of Arizona for approval to administer, in accordance with 40 CFR part 123, the AZPDES program.

Dated: July 23, 2002.

Alexis Strauss,

Acting Regional Administrator, Region IX.