[Federal Register: February 13, 2003 (Volume 68, Number 30)]
[Proposed Rules]
[Page 7327-7330]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr13fe03-8]
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ENVIRONMENTAL PROTECTION AGENCY
40 CFR Part 52
[CA086-SIP; FRL -7450-8]
Finding of Substantial Inadequacy of Implementation Plan; Call
for California State Implementation Plan Revision
AGENCY: Environmental Protection Agency (EPA).
ACTION: Proposed rule.
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SUMMARY: Pursuant to our authority in section 110(k)(5) of the Clean
Air Act (CAA or Act), EPA is proposing to find that the California
State Implementation Plan (SIP) is substantially inadequate for all
nonattainment air pollution control districts in the State and for all
attainment area districts that have an approved Prevention of
Significant Deterioration (PSD) program because the State cannot
provide ``necessary assurances'' that it or the districts have
authority to carry out the applicable nonattainment New Source Review
(NSR) or PSD portions of the SIP. Specifically, sections 110(a)(2)(C)
and (I) and 172 of the Act require the applicable implementation plan
to contain a program for issuing permits to major stationary sources of
air pollution pursuant to parts C and D of title I of the Act. In
addition, section 110(a)(2)(E) requires that each SIP provide necessary
assurances that the State or districts have adequate authority to carry
out the SIP and that no state law prohibits the State or districts from
carrying out any portion of the SIP. The California SIP does not meet
these requirements because California Health & Safety Code section
42310(e) exempts new and modified major agricultural sources from all
permitting, including PSD and NSR permitting otherwise required by
parts C and D of title I of the Act. If EPA finalizes this proposed
finding of substantial inadequacy, California will be required to amend
its state law to eliminate the permitting exemption as it pertains to
major agricultural sources of air pollution and submit the necessary
assurances by November 23, 2003 to support an affirmative finding by
EPA under section 110(a)(2)(E). If the State fails to submit the
necessary assurances of authority or if EPA disapproves any such
submittal in response to a final SIP call, sanctions will apply
statewide pursuant to section 179 of the Act.
DATES: Comments must sent by March 17, 2003. EPA will respond to
comments in its final action on this proposal.
ADDRESSES: Send comments to: Gerardo Rios, Permits Office (AIR-3), Air
Division, U.S. Environmental Protection Agency, Region 9, 75 Hawthorne
Street, San Francisco, CA 94105-3901.
You can review and copy the existing SIP rules at EPA's Region 9
office from 8:30 am to 5 pm, Monday-Friday. A reasonable fee may be
charged for copying.
Copies of the SIP rules are also available for inspection at the
following locations: California Air Resources Board, Stationary Source
Division, Rule Evaluation Section, 1001 ``I'' Street, Sacramento, CA
95814.
FOR FURTHER INFORMATION CONTACT: Please call Gerardo Rios, EPA Region
IX, at (415) 972-3974 or send e-mail to rios.gerardo@epa.gov.
SUPPLEMENTARY INFORMATION: Throughout this document, ``we,'' ``us'' and
``our'' refer to EPA.
Table of Contents
I. Background
A. What action is EPA proposing?
B. How does the California Health & Safety Code exemption affect
the adequacy of the SIP?
C. How can California correct the SIP inadequacy?
D. Are individual districts required to revise approved SIP
rules?
E. What are the consequences if we finalize this proposed
finding of substantial inadequacy?
II. Statutory and Executive Order Reviews
A. Executive Order 12866, Regulatory Planning and Review
B. Regulatory Flexibility Act
C. Unfunded Mandates Reform Act
D. Executive Order 13132, Federalism
E. Executive Order 13175, Coordination with Indian Tribal
Governments
F. Executive Order 13045, Protection of Children from
Environmental Health Risks and Safety Risks
G. Executive Order 13211, Actions that Significantly Affect
Energy Supply, Distribution, or Use
H. National Technology Transfer and Advancement Act
I. Background
A. What Action Is EPA Proposing?
CAA section 110(k)(5) provides that whenever EPA finds the
applicable implementation plan ``is substantially inadequate to attain
or maintain the relevant national ambient air quality
[[Page 7328]]
standard, * * * or to otherwise comply with any requirement of this
Act, the Administrator shall require the State to revise the plan as
necessary to correct such inadequacies.'' EPA today proposes to find
that the approved California SIP is substantially inadequate because it
cannot provide ``necessary assurances'' that the State or districts
have the authority to issue permits under their PSD and nonattainment
NSR SIPs to all major sources because Health & Safety Code section
42310(e) exempts major agricultural stationary sources from these
permitting requirements.
B. How Does the California Health & Safety Code Exemption for
Agricultural Sources Affect the Adequacy of the SIP?
For areas that fail to meet the National Ambient Air Quality
Standards (NAAQS), section 110 and title I, part D of the Act require
SIPs to contain a program for issuing ``permits for the construction
and operation of new or modified major stationary sources anywhere in
the nonattainment area, in accordance with section 173.'' CAA section
172(c)(5). EPA regulations establish that an approvable SIP program for
issuing preconstruction permits ``shall apply to any new major
stationary source or major modification that is major for the pollutant
for which the area is designated nonattainment * * * .'' 40 CFR
51.165(a)(2). Neither the Act nor EPA regulations allow any exemptions
from permitting for new major sources, and our regulations contain only
limited exemptions for major modifications. 40 CFR 51.165(a)(1)(v)(C).
For areas that attain the NAAQS, section 110 and title I, part C of
the CAA require a PSD preconstruction permitting program for new and
modified major stationary sources. See, e.g., CAA section 165. EPA
regulations also set forth the requirements for PSD permitting
programs. 40 CFR 51.166. Like nonattainment NSR, neither the Act nor
the PSD regulations contain exemptions from permitting for new major
sources, and our regulations provide only limited ones for major
modifications. See 40 CFR 51.166(b)(2)(iii).
California Health & Safety Code section 42310(e) exempts from all
air permitting ``equipment used in agricultural operations in the
growing of crops or the raising of fowl or animals.'' As a result, the
State and districts cannot issue permits to these agricultural sources,
even if they are major stationary sources under the Act. The CAA NSR
and PSD permitting requirements do not provide for this exemption.
Section 110(a)(2)(E) of the Act requires the State to provide
assurances that it has ``adequate personnel, funding, and authority
under State (and, as appropriate, local) law to carry out such
implementation plan (and is not prohibited by any provision of Federal
or State law from carrying out such implementation plan or portion
thereof) * * * .'' California Health & Safety Code section 42310(e)
effectively prohibits the State and districts from fully implementing
the SIP-approved NSR and PSD permitting programs for agricultural
sources. Thus, the SIP does not comply with the requirement for the
State to have adequate legal authority to fully implement the SIP.
Therefore, the SIP for nonattainment areas and approved PSD programs in
attainment areas in California is substantially inadequate and must be
corrected.
C. How Can California Correct the SIP Inadequacy?
To correct the deficiency, EPA recommends that the State
legislature amend Health & Safety Code section 42310(e) to remove the
exemption as it applies to major agricultural sources. The State is
already subject to a sanctions clock based on the Notice of Deficiency
(NOD) that EPA issued on May 22, 2002, 67 FR 35990, with respect to the
State's title V operating permits program. In that NOD, EPA explained
that California Health & Safety Code section 42310(e) improperly
exempted major agricultural sources from CAA title V permitting. The
NOD stated: ``EPA has determined that significant action in this
instance means the revision or removal of Health and Safety Code
42310(e) so that local air pollution control districts have the
required authority to issue title V permits to stationary agricultural
sources that are major sources of air pollution.'' A similar correction
with respect to NSR and PSD permitting is necessary to comply with this
proposed action.
The May 2002 NOD notes that the title V regulations instruct EPA to
apply sanctions in accordance with section 179(a) of the Act if
California has not corrected the deficiency (removal or revision of the
permitting exemption in Health and Safety Code section 42310(e)) prior
to November 23, 2003 (18 months after the effective date of the NOD).
The State legislature is required to take essentially the same action
(i.e., remove the agricultural permitting exemption for major
stationary sources) to correct the SIP inadequacy discussed in this
proposed action.
If EPA finalizes this SIP call and determines the State has failed
to submit the necessary assurances addressing the deficiency by the
required date, a sanctions clock would start for this SIP deficiency in
accordance with section 179 of the Act. EPA proposes that if EPA
determines the State fails to submit the necessary assurances to
address the SIP call by November 23, 2003, or if EPA subsequently finds
the correction does not adequately provide such assurances, sanctions
would apply as specified under 40 CFR 52.31.\1\
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\1\ EPA is using its authority in section 110(k)(5) to set a
deadline that is less then 18 months. We believe the November 23,
2003, deadline is reasonable because action by this date is
otherwise required to address the title V problems noted above.
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D. Are Individual Districts Required To Revise Approved SIP Rules?
EPA is not calling for specific revisions to district rules at this
time. We note that several districts may have exemptions for
agricultural sources in their local SIP-approved rules.\2\ We believe
it is reasonable to wait for the State legislature to correct Health
and Safety Code section 42310(e) first so that it is clear whether any
such exemptions at the district level represent authority problems
under section 110(a)(2)(E).\3\ EPA, nonetheless, encourages districts
to evaluate their SIP-approved rules to ensure that exemptions do not
create potential authority problems. Once the State acts to address
Health and Safety Code section 42310(e), EPA will work with the
districts to determine if further rulemaking is necessary to address
specific local deficiencies that remain after the State law change.
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\2\ EPA has conducted a preliminary search for local rules
exempting agricultural sources from NSR or PSD permitting
requirements. The following districts may have one or more
exemptions currently approved into the SIP: Bay Area, Butte, County,
El Dorado, Feather River, Medocino, Placer, Sacramento and Yolo-
Solano. As noted below, EPA will continue to evaluate the rules for
all of the districts to identify more accurately any potentially
problematic rule provisions in the SIP.
\3\ We note that certain local exemptions are tied to exemptions
such as Health and Safety Code section 42310(e) provided under State
law. Removal of the exemption at the State level could automatically
resolve authority problems at the district level. In addition, if
the State legislature were to not only revise the language of Health
and Safety Code section 42310(e) but also to clarify that any such
local exemptions were also void, no further action by the districts
may be necessary., Depending on the action at the State level, EPA
may be able to make the required finding under 110(a)(2)(E) that the
authority to carry out the permitting programs is not prohibited by
any State or local law.
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[[Page 7329]]
E. What Are the Consequences if We Finalize This Proposed Finding of
Substantial Inadequacy?
If EPA finalizes this SIP call, as proposed, the State would need
to submit to EPA a SIP revision providing the necessary assurances that
it (or the districts) can fully implement the required NSR and PSD
programs within the State. If the State fails to submit the required
assurances or if EPA finds the submittal incomplete or disapprovable,
sanctions would apply in accordance with CAA sections 179(a) and (b)
and EPA regulations at 40 CFR 52.31. There are two types of sanctions:
highway funding sanctions (section 179(b)(1)) and offset sanctions
(section 179(b)(2)). Pursuant to our regulations at 40 CFR 52.31,
offset sanctions will apply 18 months following a finding by EPA under
section 179(a); highway funding sanctions would apply six months later.
II. Statutory and Executive Order Reviews
A. Executive Order 12866, Regulatory Planning and Review
Under Executive Order 12866 (58 FR 51735 (October 4, 1993)), the
Agency must determine whether the regulatory action is ``significant''
and therefore subject to OMB review and the requirements of the
Executive Order. The Executive Order defines ``significant regulatory
action'' as one that is likely to result in a rule that may:
(1) Have an annual effect on the economy of $100 million or more or
adversely affect in a material way the economy, a sector of the
economy, productivity, competition, jobs, the environment, public
health or safety, or State, local, or tribal governments or
communities;
(2) Create a serious inconsistency or otherwise interfere with an
action taken or planned by another agency;
(3) Materially alter the budgetary impact of entitlements, grants,
user fees, or loan programs or the rights and obligations of recipients
thereof; or
(4) Raise novel legal or policy issues arising out of legal
mandates, the President's priorities, or the principles set forth in
the Executive Order.
The Office of Management and Budget (OMB) has historically exempted
from Executive Order 12866 regulatory actions governing revisions to
SIPs. It has been determined that today's proposed call for revisions
to the SIP would not, in any event, be a ``significant regulatory
action'' under the terms of Executive Order 12866 and is therefore not
subject to OMB review.
B. Regulatory Flexibility Act
The Regulatory Flexibility Act (RFA) generally requires an agency
to conduct a regulatory flexibility analysis of any rule subject to
notice and comment rulemaking requirements unless the agency certifies
that the rule will not have a significant economic impact on a
substantial number of small entities. Small entities include small
businesses, small not-for-profit enterprises, and small governmental
jurisdictions.
Today's proposed SIP call would not establish requirements
applicable to small entities. Instead, it would require the State of
California and several local air districts to develop, adopt, and
submit SIP revisions that would provide the necessary assurances that
the applicable NSR and PSD programs do not exempt major agricultural
sources.
This rule will not have a significant impact on a substantial
number of small entities because the rule does not establish
requirements applicable to small entities. Therefore, the Administrator
certifies that this action will not have a significant impact on a
substantial number of small entities.
C. Unfunded Mandates Reform Act
Under sections 202 of the Unfunded Mandates Reform Act of 1995
(UMRA), signed into law on March 22, 1995, EPA must prepare a budgetary
impact statement to accompany any proposed or final rule that includes
a Federal mandate that may result in estimated costs to State, local,
or tribal governments in the aggregate, or to the private sector, of
$100 million or more. Under section 205, EPA must select the most cost-
effective and least burdensome alternative that achieves the objectives
of the rule and is consistent with statutory requirements. Section 203
requires EPA to establish a plan for informing and advising any small
governments that may be significantly or uniquely impacted by the rule.
EPA has determined that the action proposed does not include a
Federal mandate that may result in estimated costs of $100 million or
more to either State, local, or tribal governments in the aggregate, or
to the private sector. The proposed action will require the State of
California and several local air districts to revise laws and
regulations governing exemptions for agricultural sources. This
requirement, even if considered a federal mandate,\4\ would not result
in aggregate costs over $100 million to either the state or local
districts. In addition, this proposed rule, if finalized, will not
significantly or uniquely impact small governments.
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\4\ It is unclear whether a requirement to submit a SIP revision
would constitute a federal mandate. The obligation for a state to
revise its SIP that arises out of sections 110(a) and 110(k)(5) of
the CAA is not legally enforceable by a court of law, and at most is
a condition for continued receipt of highway funds. Therefore, it is
possible to view an action requiring such a submittal as not
creating any enforceable duty within the meaning of section
421(5)(9a)(I) of UMRA (2 U.S.C. 658 (a)(I)). Even if it did, the
duty could be viewed as falling within the exception for a condition
of Federal assistance under section 421(5)(a)(i)(I) of UMRA (2
U.S.C. 658(5)(a)(i)(I)).
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D. Executive Order 13132, Federalism
Federalism (64 FR 43255, August 10, 1999) revokes and replaces
Executive Orders 12612 (Federalism) and 12875 (Enhancing the
Intergovernmental Partnership). Executive Order 13132 requires EPA to
develop an accountable process to ensure ``meaningful and timely input
by State and local officials in the development of regulatory policies
that have federalism implications.'' ``Policies that have federalism
implications'' is defined in the Executive Order to include regulations
that have ``substantial direct effects on the States, on the
relationship between the national government and the States, or on the
distribution of power and responsibilities among the various levels of
government.'' Under Executive Order 13132, EPA may not issue a
regulation that has federalism implications, that imposes substantial
direct compliance costs, and that is not required by statute, unless
the Federal government provides the funds necessary to pay the direct
compliance costs incurred by State and local governments, or EPA
consults with State and local officials early in the process of
developing the proposed regulation. EPA also may not issue a regulation
that has federalism implications and that preempts State law unless the
Agency consults with State and local officials early in the process of
developing the proposed regulation.
This rule will not have substantial direct effects on the States,
on the relationship between the national government and the States, or
on the distribution of power and responsibilities among the various
levels of government, as specified in Executive Order 13132, because it
does not impose a new enforceable duty on the State (see infra note 1),
and does not alter the relationship or the distribution of power and
responsibilities established in the Clean Air Act. Thus, the
requirements of section 6 of the Executive Order do not apply to this
rule.
[[Page 7330]]
E. Executive Order 13175, Coordination With Indian Tribal Governments
Executive Order 13175, entitled ``Consultation and Coordination
with Indian Tribal Governments'' (65 FR 67249, November 9, 2000),
requires EPA to develop an accountable process to ensure ``meaningful
and timely input by tribal officials in the development of regulatory
policies that have tribal implications.'' This proposed rule does not
have tribal implications, as specified in Executive Order 13175 because
it does not apply to any Tribes or otherwise have substantial direct
effects on tribal governments, on the relationship between the Federal
government and Indian tribes, or on the distribution of power and
responsibilities between the Federal government and Indian tribes.
Thus, Executive Order 13175 does not apply to this rule.
EPA, nonetheless, specifically solicits additional comment on this
proposed rule from tribal officials.
F. Executive Order 13045, Protection of Children From Environmental
Health Risks and Safety Risks
Protection of Children from Environmental Health Risks and Safety
Risks (62 FR 19885, April 23, 1997), applies to any rule that: (1) Is
determined to be ``economically significant'' as defined under
Executive Order 12866, and (2) concerns an environmental health or
safety risk that EPA has reason to believe may have a disproportionate
effect on children. If the regulatory action meets both criteria, the
Agency must evaluate the environmental health or safety effects of the
planned rule on children, and explain why the planned regulation is
preferable to other potentially effective and reasonably feasible
alternatives considered by the Agency.
This rule is not subject to Executive Order 13045 because it does
not involve decisions intended to mitigate environmental health or
safety risks.
G. Executive Order 13211, Actions That Significantly Affect Energy
Supply, Distribution, or Use
This rule is not subject to Executive Order 13211, ``Actions
Concerning Regulations That Significantly Affect Energy Supply,
Distribution, or Use'' (66 FR 28355, May 22, 2001) because it is not a
significant regulatory action under Executive Order 12866.
H. National Technology Transfer and Advancement Act
Section 12 of the National Technology Transfer and Advancement Act
(NTTAA) of 1995 requires Federal agencies to evaluate existing
technical standards when developing a new regulation. To comply with
NTTAA, EPA must consider and use ``voluntary consensus standards''
(VCS) if available and applicable when developing programs and policies
unless doing so would be inconsistent with applicable law or otherwise
impractical.
The EPA believes that VCS are inapplicable to this action. Today's
action does not require the public to perform activities conducive to
the use of VCS.
List of Subjects in 40 CFR Part 52
Environmental protection, Air pollution control, Intergovernmental
relations, New Source Review, Nitrogen dioxide, Ozone, Particulate
matter, Reporting and recordkeeping requirements, Volatile organic
compounds.
Dated: January 31, 2003.
Wayne Nastri,
Regional Administrator, Region IX.
[FR Doc. 03-3416 Filed 2-12-03; 8:45 am]
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