[Federal Register Volume 75, Number 229 (Tuesday, November 30, 2010)]
[Proposed Rules]
[Pages 74518-74543]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2010-29248]



[[Page 74517]]

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Part IV





Environmental Protection Agency





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40 CFR Part 52



 Approval and Promulgation of Implementation Plans; State of 
California; 2008 San Joaquin Valley State Implementation Plan for Fine 
Particulate Matter; 2007 State Strategy; PM[bdi2].[bdi5]; 
Proposed Rule

Federal Register / Vol. 75 , No. 229 / Tuesday, November 30, 2010 / 
Proposed Rules

[[Page 74518]]


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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[EPA-R09-OAR-2010-0516; FRL-9229-4]


Approval and Promulgation of Implementation Plans; State of 
California; 2008 San Joaquin Valley State Implementation Plan for Fine 
Particulate Matter; 2007 State Strategy; PM[bdi2].[bdi5]

AGENCY: Environmental Protection Agency (EPA).

ACTION: Proposed rule.

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SUMMARY: EPA is proposing to approve in part and disapprove in part 
state implementation plan (SIP) revisions submitted by California to 
provide for attainment of the 1997 annual and 24-hour fine particulate 
matter (PM2.5) national ambient air quality standards 
(NAAQS) in the San Joaquin Valley (SJV) nonattainment area. The SIP 
revisions are the SJV 2008 PM2.5 Plan (revised 2010) and 
portions of the 2007 State Strategy (revised 2009). Specifically, EPA 
is proposing to approve the emissions inventories as meeting the 
requirements of the Clean Air Act and EPA's fine particle implementing 
rule and to approve commitments to implement specific measures and meet 
specific aggregate emissions reductions by the San Joaquin Valley Air 
Pollution Control District and the California Air Resource Board. In 
addition, we are proposing to find that volatile organic compounds are 
a PM2.5 attainment plan precursor in the SJV for which 
controls should be evaluated. EPA is proposing to disapprove the 
attainment demonstration. EPA is also proposing to disapprove the 
reasonably available control measures/reasonably available control 
technology demonstration, the air quality modeling, the reasonable 
further progress (RFP) demonstration, the contingency measures, and the 
attainment and RFP conformity motor vehicle emissions budgets. EPA is 
also proposing to not grant California's request to extend to April 5, 
2015 the deadline for the SJV nonattainment area to attain the 1997 
PM2.5 NAAQS.

DATES: Any comments must arrive by January 31, 2011.

ADDRESSES: Submit comments, identified by docket number EPA-R09-OAR-
2010-0516, by one of the following methods:
     Federal eRulemaking Portal: http://www.regulations.gov. 
Follow the online instructions.
     E-mail: [email protected].
     Mail or deliver: Frances Wicher, Office of Air Planning 
(AIR-2), U.S. Environmental Protection Agency Region IX, 75 Hawthorne 
Street, San Francisco, CA 94105.
    Instructions: All comments will be included in the public docket 
without change and may be made available online at http://www.regulations.gov, including any personal information provided, 
unless the comment includes Confidential Business Information (CBI) or 
other information for which disclosure is restricted by statute. 
Information that you consider CBI or otherwise protected should be 
clearly identified as such and should not be submitted through http://www.regulations.gov or e-mail. The http://www.regulations.gov Web site 
is an ``anonymous access'' system, and EPA will not know your identity 
or contact information unless you provide it in the body of your 
comments. If you send e-mail directly to EPA, your e-mail address will 
be automatically captured and included as part of the public comment. 
If EPA cannot read your comments due to technical difficulties and 
cannot contact you for clarification, EPA may not be able to consider 
your comments.
    Docket: The index to the docket for this action is available 
electronically at http://www.regulations.gov and in hard copy at EPA 
Region IX, 75 Hawthorne Street, San Francisco, California. While all 
documents in the docket are listed in the index, some may be publicly 
available only at the hard copy location (e.g., copyrighted material) 
and some may not be publicly available at either location (e.g., CBI). 
To inspect the hard copy materials, please schedule an appointment 
during normal business hours with the contact listed in the FOR FURTHER 
INFORMATION CONTACT section below.
    Copies of the SIP materials are also available for inspection at 
the following locations:
     California Air Resources Board, 2020 L Street, Sacramento, 
California 95812
     San Joaquin Valley Unified Air Pollution Control District, 
1990 E. Gettysburg, California 93726.
    The SIP materials are also electronically available at: http://www.valleyair.org/Air_Quality_Plans/PM_Plans.htm and http://www.arb.ca.gov/planning/sip/sip.htm.

FOR FURTHER INFORMATION CONTACT: Frances Wicher, Air Planning Office 
(AIR-2), U.S. Environmental Protection Agency, Region IX, (415) 972-
3957, [email protected].

SUPPLEMENTARY INFORMATION: Throughout this document, we, us and our 
refer to EPA.

Table of Contents

I. The PM2.5 NAAQS and the San Joaquin Valley 
PM2.5 Nonattainment Area
II. California's State Implementation Plan Submittals to Address 
PM2.5 Attainment in the San Joaquin Valley
A. California's SIP Submittals
    1. SJV 2008 PM2.5 Plan
    2. CARB 2007 State Strategy
B. CAA Procedural and Administrative Requirements for SIP Submittals
III. CAA and Regulatory Requirements for PM2.5 Attainment 
SIPs
IV. Review of the SJV 2008 PM2.5 Plan and the SJV Portion 
of the Revised 2007 State Strategy
A. Summary of EPA's Proposed Actions
B. Emissions Inventories
    1. Requirements for Emissions Inventories
    2. Emissions Inventories in the SJV PM2.5 SIP
    3. Proposed Action on the Emissions Inventories
C. Reasonably Available Control Measures/Reasonably Available 
Control Technology Demonstration and the Adopted Control Strategy
    1. Requirement for RACM/RACT
    2. RACM/RACT Demonstration in the SJV PM2.5 SIP
    a. SJVAPCD's RACM/RACT Analysis and Adopted Control Strategy
    b. CARB's RACM Analysis and Adopted Control Strategy
    c. Local Jurisdictions' RACM Analysis
    3. Proposed Actions on RACM/RACT Demonstration and Adopted 
Control Strategy
D. Attainment Demonstration
    1. Requirements for Attainment Demonstrations
    2. Air Quality Modeling in the SJV 2008 PM2.5 Plan
    3. PM2.5 Attainment Plan Precursors
    4. Extension of the Attainment Date
    5. Attainment Demonstration
    a. Enforceable Commitments
    i. Commitment must Represent a Limited Portion of Required 
Reductions
    ii. The State must be Capable of Fulfilling its Commitment
    iii. The Commitment must be for a Reasonable and Appropriate 
Period of Time
    6. Proposed Action on the Attainment Demonstration
E. Reasonable Further Progress Demonstration
    1. Requirements for RFP
    2. The RFP Demonstration in the SJV 2008 PM2.5 Plan
    3. Proposed Action on the RFP Demonstration
F. Contingency Measures
    1. Requirements for Contingency Measures
    2. Contingency Measures in the SJV 2008 PM2.5 Plan
    3. Proposed Action on the Contingency Measures
G. Motor Vehicle Emissions Budgets for Transportation Conformity

[[Page 74519]]

    1. Requirements for Motor Vehicle Emissions Budgets
    2. Motor Vehicle Emissions Budgets in the SJV 2008 
PM2.5 Plan
    3. April 23, 2010 Budget Adequacy/Inadequacy Finding
    4. Proposed Finding and Action on the Budgets
H. Mid-Course Review
I. Inter-Pollutant Trading for PM2.5 Offsets
V. EPA's Proposed Actions and Potential Consequences
A. EPA's Proposed Approvals and Disapprovals
B. CAA Consequences of a Final Disapproval
VI. Statutory and Executive Order Reviews

I. The PM2.5 NAAQS and the San Joaquin Valley 
PM2.5 Nonattainment Area

    On July 18, 1997 (62 FR 36852), EPA established new national 
ambient air quality standards (NAAQS) for PM2.5, particulate 
matter with a diameter of 2.5 microns or less, including annual 
standards of 15.0 [mu]g/m\3\ based on a 3-year average of annual mean 
PM2.5 concentrations and 24-hour (daily) standards of 65 
[mu]g/m\3\ based on a 3-year average of the 98th percentile of 24-hour 
concentrations. 40 CFR 50.7. EPA established the standards based on 
substantial evidence from numerous health studies demonstrating that 
serious health effects are associated with exposures to 
PM2.5 concentrations above the levels of these standards.
    Epidemiological studies have shown statistically significant 
correlations between elevated PM2.5 levels and premature 
mortality. Other important health effects associated with 
PM2.5 exposure include aggravation of respiratory and 
cardiovascular disease (as indicated by increased hospital admissions, 
emergency room visits, absences from school or work, and restricted 
activity days), changes in lung function and increased respiratory 
symptoms, as well as new evidence for more subtle indicators of 
cardiovascular health. Individuals particularly sensitive to 
PM2.5 exposure include older adults, people with heart and 
lung disease, and children. See, EPA, Air Quality Criteria for 
Particulate Matter, No. EPA/600/P-99/002aF and EPA/600/P-99/002bF, 
October 2004.
    PM2.5 can be emitted directly into the atmosphere as a 
solid or liquid particle (primary PM2.5 or direct 
PM2.5) or can be formed in the atmosphere as a result of 
various chemical reactions from precursor emissions of nitrogen oxides, 
sulfur dioxide, volatile organic compounds, and ammonia (secondary 
PM2.5). See 72 FR 20586, 20589 (April 25, 2007).
    Following promulgation of a new or revised NAAQS, EPA is required 
by Clean Air Act (CAA) section 107(d) to designate areas throughout the 
nation as attaining or not attaining the NAAQS. On January 5, 2005, EPA 
published initial air quality designations for the 1997 
PM2.5 NAAQS, based on air quality monitoring data for the 
three-year periods of 2001-2003 or 2002-2004. 70 FR 944. These 
designations became effective on April 5, 2005.\1\
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    \1\ On October 17, 2006, EPA strengthened the 24-hour 
PM2.5 NAAQS by lowering the level to 35 [mu]g/m\3\. At 
the same time, it retained the level of the annual PM2.5 
standards at 15.0 [mu]g/m\3\. 71 FR 61144. On November 13, 2006, EPA 
designated areas, including the SJV, with respect to the revised 24-
hour NAAQS. 74 FR 58688. California is now required to submit an 
attainment plan for the 35 [mu]g/m\3\ 24-hour standards no later 
than 3 years after the effective date of the designation, that is, 
no later than December 14, 2012. In this preamble, all references to 
the PM2.5 NAAQS, unless otherwise specified, are to the 
1997 24-hour PM2.5 standards of 65 [mu]g/m\3\ and annual 
standards of 15 [mu]g/m\3\ as codified in 40 CFR Sec.  50.7.
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    EPA designated the San Joaquin Valley (SJV), in the southern part 
of California's Central Valley, nonattainment for both the 1997 annual 
and 24-hour PM2.5 standards. 40 CFR 81.305. The SJV 
PM2.5 nonattainment area is home to 4 million people and is 
the nation's leading agricultural area. Stretching over 250 miles from 
north to south and averaging 80 miles wide, it is partially enclosed by 
the Coast Mountain range to the west, the Tehachapi Mountains to the 
south, and the Sierra Nevada range to the east. It encompasses over 
23,000 square miles and includes all or part of eight counties: San 
Joaquin, Stanislaus, Merced, Madera, Fresno, Tulare, Kings, and the 
valley portion of Kern. For a precise description of the geographic 
boundaries of the San Joaquin Valley PM2.5 nonattainment 
area, see 40 CFR Sec.  81.305. The local air district with primary 
responsibility for developing a plan to attain the PM2.5 
NAAQS in this area is the San Joaquin Valley Air Pollution Control 
District (SJVAPCD or District).
    Ambient annual and 24-hour PM2.5 levels in the urban 
Bakersfield area in the southern SJV are the highest recorded in the 
United States at 22.6 [mu]g/m\3\ and 70 [mu]g/m\3\, respectively, for 
the 2007-2009 period.\2\ In the SJV, the levels and composition of 
ambient PM2.5 differ by season. 2008 PM2.5 Plan, 
Figures H-4 and H-5. Higher PM2.5 concentrations occur 
during the winter, between late November and February, when ambient 
PM2.5 is dominated by ammonium nitrate, formed from 
NOX and ammonia emissions, and directly-emitted 
particulates, such as wood smoke. During the winter, the SJV 
experiences extended periods of stagnant weather with cold, damp, foggy 
conditions which are conducive to the formation of secondary ammonium 
nitrate particulates and encourage wood burning. During the summer, 
PM2.5 levels generally remain below 15 [mu]g/m\3\, the level 
of the annual standards. 2008 PM2.5 Plan, Figures H-6 and H-
7.
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    \2\ See EPA, Air Quality System, Design Value Report, August 9, 
2010. These values are the highest design values in the SJV. A 
design value is an ambient concentration calculated using a specific 
methodology from monitored air quality data and is used to compare 
an area's air quality to a NAAQS. The methodologies for calculating 
design values for the annual and 24-hour PM2.5 NAAQS are 
found in 40 CFR part 50 Appendix N Sections 1(c)(1) and (c)(2), 
respectively.
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II. California's State Implementation Plan Submittals to Address 
PM2.5 Nonattainment in the San Joaquin Valley

A. California's SIP Submittals

    Designation of an area as nonattainment starts the process for a 
state to develop and submit to EPA a state implementation plan (SIP) 
under title 1, part D of the CAA. This SIP must include, among other 
things, a demonstration of how the NAAQS will be attained in the 
nonattainment area as expeditiously as practicable but no later than 
the date required by the CAA. Under CAA section 172(b), a state has up 
to three years after an area's designation as nonattainment to submit 
its SIP to EPA. For the 1997 PM2.5 NAAQS, these SIPs were 
due no later than April 5, 2008.
    California has made several SIP submittals to address the CAA's 
PM2.5 attainment planning requirements in the San Joaquin 
Valley. The two principal ones are the SJVAPCD's 2008 PM2.5 
Plan (2008 PM2.5 Plan or Plan) and the California Air 
Resources Board's (CARB) State Strategy for California's 2007 State 
Implementation Plan (2007 State Strategy).
    In addition to these submittals, the District and State have also 
submitted numerous rules that contribute to improving air quality in 
the San Joaquin Valley. EPA has approved many of these rules. See 
Appendices A and B of the technical support document (TSD) for this 
proposal.
1. SJV 2008 PM2.5 Plan
    The 2008 PM2.5 Plan was adopted by the District's 
Governing Board on April 30, 2008 and by CARB on May 22, 2008 and 
submitted to EPA on June 30, 2008.\3\ It includes an attainment

[[Page 74520]]

demonstration, commitments by the SJVAPCD to adopt control measures to 
achieve emissions reductions from sources under its jurisdiction 
(primarily stationary sources), and motor-vehicle emissions budgets 
used for transportation conformity purposes. The attainment 
demonstration includes air quality modeling, a reasonable further 
progress (RFP) plan, an analysis of reasonably available control 
measures/reasonably available control technology (RACM/RACT), base year 
and projected year emissions inventories, and contingency measures. The 
2008 PM2.5 Plan also includes the District's demonstration 
that attainment of the PM2.5 standards in the SJV will 
require significant reductions in NOX and PM2.5 
emissions (50 percent and 25 percent from 2005 levels, respectively) 
and that the most expeditious date for attaining the 1997 
PM2.5 NAAQS in the San Joaquin Valley is April 5, 2015. On 
September 15, 2010, CARB submitted a minor revision to the 2008 
PM2.5 Plan's control strategy to extend the adoption date 
for one control measure.\4\ Future references to the 2008 
PM2.5 Plan in this proposal will be to the Plan as revised 
in 2010.
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    \3\ See San Joaquin Valley Unified Air Pollution Control 
District Governing Board Resolution: In the Matter of Adopting the 
San Joaquin Valley Unified Air Pollution Control District 2008 
PM2.5 Plan, April 30, 2008 (SJVAPCD Governing Board 
Resolution), CARB Resolution No. 08-28, May 22, 2008; and letter, 
James N. Goldstene, Executive Officer, CARB to Wayne Nastri, 
Regional Administrator, EPA Region 9, June 30, 2008, with 
enclosures.
    \4\ See letter, James N. Goldstene, Executive Officer, CARB to 
Jared Blumenfeld, Regional Administrator, EPA Region 9, September 
15, 2010, with enclosures.
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2. CARB 2007 State Strategy
    To demonstrate attainment, the 2008 PM2.5 Plan relies in 
part on measures in CARB's 2007 State Strategy. The 2007 State Strategy 
was adopted by CARB on September 27, 2007 and submitted to EPA on 
November 16, 2007.\5\ It discusses CARB's overall approach to 
addressing, in conjunction with local plans, attainment of both the 
1997 PM2.5 and 8-hour ozone NAAQS not only in the San 
Joaquin Valley but also in California's other nonattainment areas such 
as the South Coast Air Basin and the Sacramento area. It also includes 
CARB's commitments to propose 15 defined State measures \6\ and to 
obtain specific amounts of aggregate emissions reductions of direct 
PM2.5, nitrogen oxides (NOX), and volatile 
organic compounds (VOC) in the SJV from sources under the State's 
jurisdiction, which are primarily on- and off-road motor vehicles and 
engines.
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    \5\ See CARB Resolution No. 07-28, September 27, 2007 with 
attachments and letter, James N. Goldstene, Executive Officer, CARB, 
to Wayne Nastri, Regional Administrator, EPA Region 9, November 16, 
2007 with enclosures.
    \6\ The 2007 State Strategy also includes measures to be 
implemented by the California Bureau of Automotive Repair (Smog 
Check improvements) and the California Department of Pesticide 
Regulation (VOC reductions from pesticide use). See 2007 State 
Strategy, pp. 64-65 and CARB Resolution 7-28, Attachment B, p. 8.
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    On August 12, 2009, CARB submitted the ``Status Report on the State 
Strategy for California's 2007 State Implementation Plan (SIP) and 
Proposed Revision to the SIP Reflecting Implementation of the 2007 
State Strategy,'' dated March 24, 2009, adopted April 24, 2009 (2009 
State Strategy Status Report) \7\ which updates the 2007 State Strategy 
to reflect its implementation during 2007 and 2008.\8\
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    \7\ See CARB Resolution No. 09-34, April 21, 2009, with 
attachments and letter, James N. Goldstene, Executive Officer, CARB, 
to Laura Yoshii, Acting Regional Administrator, EPA Region 9, August 
12, 2009 with enclosures. Only pages 11-27 of the 2009 State 
Strategy Status Report are submitted as a SIP revision. The balance 
is for informational purposes only. See Attachment A to the CARB 
Resolution No. 09-34.
    \8\ We will also refer to the 2007 State Strategy as revised in 
2009 as the revised 2007 State Strategy.
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    In today's proposal, we are only evaluating those portions of the 
2007 State Strategy as revised in 2009 that are relevant for attainment 
of the 1997 PM2.5 standards in the San Joaquin Valley.

B. CAA Procedural and Administrative Requirements for SIP Submittals

    CAA sections 110(a)(1) and (2) and 110(l) require a state to 
provide reasonable public notice and opportunity for public hearing 
prior to the adoption and submittal of a SIP or SIP revision. To meet 
this requirement, every SIP submittal should include evidence that 
adequate public notice was given and a public hearing was held on it 
consistent with EPA's implementing regulations in 40 CFR 51.102.
    Both the SJVAPCD and CARB have satisfied applicable statutory and 
regulatory requirements for reasonable public notice and hearing prior 
to adoption and submittal of the 2008 PM2.5 Plan. The 
District conducted public workshops, provided public comment periods, 
and held a public hearing prior to the adoption of the Plan on April 
30, 2008. See 2008 PM2.5 Plan, Appendix J and SJVAPCD 
Governing Board Resolution, p. 3. CARB provided the required public 
notice and opportunity for public comment prior to its May 22, 2008 
public hearing on the Plan. See CARB Resolution No. 08-28. The District 
also provided the required public notice and hearing on the 2010 
revision to the Plan. See SJVAPCD Governing Board Resolution No. 10-06-
18.
    CARB conducted public workshops, provided public comment periods, 
and held a public hearing prior to the adoption of the 2007 State 
Strategy on September 27, 2007. See CARB Resolution No. 07-28. CARB 
also provided the required public notice, opportunity for public 
comment, and a public hearing prior to its April 24, 2009 adoption of 
the 2009 State Strategy Status Report. See CARB Resolution No. 09-34.
    The SIP submittals include proof of publication for notices of 
SJVAPCD and CARB public hearings, as evidence that all hearings were 
properly noticed. We find, therefore, that each of the four submittals 
that comprise the SJV PM2.5 SIP meets the procedural 
requirements of CAA sections 110(a) and 110(l).
    CAA section 110(k)(1)(B) requires EPA to determine whether a SIP 
submittal is complete within 60 days of receipt. This section also 
provides that any plan that EPA has not affirmatively determined to be 
complete or incomplete will become complete six months after the date 
of submittal by operation of law. EPA's SIP completeness criteria are 
found in 40 CFR part 51, Appendix V.
    The June 30, 2008 submittal of the 2008 PM2.5 Plan 
became complete by operation of law on December 30, 2008. We found the 
2010 revision to the Plan complete on September 23, 2010.\9\ The 
November 16, 2007 submittal of the 2007 State Strategy and the August 
12, 2009 submittal of the 2009 revisions to the Strategy became 
complete by operation of law on May 16, 2008 and February 12, 2010, 
respectively.
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    \9\ Letter, Deborah Jordan, EPA-Region 9 to James Goldstene, 
CARB, September 23, 2010.
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III. CAA and Regulatory Requirements for PM2.5 Attainment 
SIPs

    EPA is implementing the 1997 PM2.5 NAAQS under Title 1, 
Part D, subpart 1 of the CAA, which includes section 172, 
``Nonattainment plan provisions.'' Section 172(a)(2) requires that a 
PM2.5 nonattainment area attain the NAAQS as ``as 
expeditiously as practicable'' but no later than five years from the 
date of the area's designation as nonattainment. This section also 
allows EPA to grant up to a five-year extension of an area's attainment 
date based on the severity of the area's nonattainment and the 
availability and feasibility of controls. EPA designated the SJV as 
nonattainment effective April 5, 2005, and thus the applicable 
attainment date is no later than April 5, 2010 or, should EPA grant a 
full five-year extension, no later than April 5, 2015.

[[Page 74521]]

    Section 172(c) contains the general statutory planning requirements 
applicable to all nonattainment areas, including the requirements for 
emissions inventories, RACM/RACT, attainment demonstrations, RFP 
demonstrations, and contingency measures.
    On April 25, 2007, EPA issued the Clean Air Fine Particle 
Implementation Rule for the 1997 PM2.5 NAAQS. 72 FR 20586, 
codified at 40 CFR part 51, subpart Z (PM2.5 implementation 
rule). The PM2.5 implementation rule and its preamble 
address the statutory planning requirements for emissions inventories, 
RACM/RACT, attainment demonstrations including air quality modeling 
requirements, RFP demonstrations, and contingency measures. This rule 
also addresses other matters such as which PM2.5 precursors 
must be addressed by the state in its PM2.5 attainment SIP, 
applicable attainment dates, and the requirement for mid-course 
reviews.\10\ We will discuss each of these CAA and regulatory 
requirements for PM2.5 attainment plans in more detail 
below.
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    \10\ In June 2007, a petition to the EPA Administrator was filed 
on behalf of several public health and environmental groups 
requesting reconsideration of four provisions in the 
PM2.5 implementation rule. See Earthjustice, Petition for 
Reconsideration, ``In the Matter of Final Clean Air Fine Particle 
Implementation Rule,'' June 25, 2007. These provisions are (1) The 
presumption that compliance with the Clean Air Interstate Rule 
satisfies the NOX and SO2 RACT requirements 
for electric generating units; (2) the deferral of the requirement 
to establish emission limits for condensable particulate matter 
(CPM) until January 1, 2011; (3) revisions to the criteria for 
analyzing the economic feasibility of RACT; and (4) the use of out-
of-area emissions reductions to demonstrate RFP. These provisions 
are found in the PM2.5 implementation rule and preamble 
at 20623-20628, 40 CFR 51.1002(c), 20619-20620, and 20636, 
respectively. On May 13, 2010, EPA granted the petition with respect 
to the fourth issue. Letter, Gina McCarthy, EPA, to David Baron and 
Paul Cort, Earthjustice, May 13, 2010. EPA is currently considering 
the other issues raised in the petition.
    Neither the District nor the State relied on the first, third, 
or fourth of these provisions in preparing the 2008 PM2.5 
Plan or the 2007 State Strategy. The District has deferred some, but 
not all, CPM limits in its rules. EPA does not believe this deferral 
affects its proposed disapproval actions on the SIP's RACM/RACT or 
expeditious attainment demonstrations. See section II.D.3 of the TSD 
for this proposal. We will evaluate any rule adopted or revised by 
the District after January 1, 2011 to assure that it appropriately 
addresses CPM.
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IV. Review of the SJV 2008 PM2.5 Plan and the SJV Portion of 
the Revised 2007 State Strategy

A. Summary of EPA's Proposed Actions

    EPA is proposing to approve in part and disapprove in part the SJV 
2008 PM2.5 Plan and those portions of the 2007 State 
Strategy as revised in 2009 specific to PM2.5 attainment in 
the SJV.
    We are proposing to approve the emissions inventories in these SIP 
revisions as meeting the applicable requirements of the CAA and 
PM2.5 implementation rule. We are also proposing to approve 
the District's and CARB's commitments to specific measures and specific 
aggregate emissions reductions in these SIP revisions as strengthening 
the SIP.
    In addition, we are proposing to find that volatile organic 
compounds (VOC) are a PM2.5 attainment plan precursor that 
must be addressed in the RACM/RACT analysis, RFP and attainment 
demonstrations, and for other PM2.5 SIP control 
requirements. The Plan as submitted does not treat VOC as a 
PM2.5 attainment plan precursor.
    We are proposing to disapprove the air quality modeling analysis on 
which the 2008 PM2.5 Plan's attainment, RACM/RACT, and RFP 
demonstrations and the State's attainment date extension request are 
based because the Plan does not currently include sufficient 
documentation and analysis for EPA to determine the modeling's 
adequacy.
    Based on our proposed finding that VOC should be a PM2.5 
attainment plan precursor and our proposed disapproval of the air 
quality modeling, we are proposing to disapprove the 2008 
PM2.5 Plan's RACM/RACT analysis and the RFP and attainment 
demonstrations and related contingency measures as not meeting the 
applicable requirements of the CAA and PM2.5 implementation 
rule. We are also proposing to disapprove the transportation conformity 
motor vehicle emissions budgets for the RFP milestone years of 2009 and 
2012 and the attainment year of 2014.\11\ We are proposing to 
disapprove the attainment demonstration for the additional reason that 
it relies too extensively on commitments to emissions reductions in 
lieu of fully adopted and submitted rules. Rules that have either not 
been adopted in final form or have not been submitted to and approved 
by EPA cannot be credited toward the attainment demonstration. Finally, 
we are proposing to not grant the State's request to extend the 
attainment date for the PM2.5 NAAQS in the SJV to April 5, 
2015.
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    \11\ While the attainment date for PM2.5 areas with a 
full five-year extension would be April 5 2015, reductions must be 
implemented by 2014 to achieve attainment by that date. See 40 CFR 
51.1007(b). We refer, therefore, to 2014 as the attainment year and 
April 5, 2015 as the attainment date.
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    EPA's analysis and findings are summarized below and are described 
in more detail in the TSD for this proposal which is available online 
at http://www.regulations.gov in the docket, EPA-R09-OAR-2010-0516, or 
from the EPA contact listed at the beginning of this notice.

B. Emissions Inventories

1. Requirements for Emissions Inventories
    CAA section 172(c)(3) requires states to submit a ``comprehensive, 
accurate, current inventory of actual emissions from all sources of the 
relevant pollutant.'' The PM2.5 implementation rule requires 
a state to include direct PM2.5 emissions and emissions of 
all PM2.5 precursors in this inventory, even if it has 
determined that control of any of these precursors is not necessary for 
expeditious attainment. 40 CFR 51.1008(a)(1) and 72 FR 20586 at 20648. 
Direct PM2.5 includes condensable particulate matter. 40 CFR 
51.1000. PM2.5 precursors are NOX, 
SO2, VOC, and ammonia. Id. The inventories should meet the 
data requirements of EPA's Consolidated Emissions Reporting Rule 
(codified at 40 CFR part 51 subpart A) and include any additional 
inventory information needed to support the SIP's attainment 
demonstration and (where applicable) RFP demonstration. 40 CFR 
51.1008(a)(1) and (2).
    A baseline emissions inventory is required for the attainment 
demonstration and for meeting RFP requirements. As determined on the 
date of designation, the base year for this inventory should be the 
most recent calendar year for which a complete inventory was required 
to be submitted to EPA. The baseline emissions inventory for calendar 
year 2002 or other suitable year should be used for attainment planning 
and RFP plans for areas initially designated nonattainment for the 
PM2.5 NAAQS in 2005. 40 CFR 51.1008(b).
    EPA has provided additional guidance for PM2.5 emissions 
inventories in ``Emissions Inventory Guidance for Implementation of 
Ozone and Particulate Matter NAAQS and Regional Haze Regulations,'' 
November 2005 (EPA-454/R-05-001).
2. Emissions Inventories in the SJV PM2.5 SIP
    The baseline planning inventories for direct PM2.5 and 
all PM2.5 precursors for the SJV PM2.5 
nonattainment area together with additional documentation for the 
inventories are found in Appendix B of the 2008 PM2.5 Plan. 
Both average winter day and average annual day baseline inventories are 
provided for the year 2005 (the reference year for the air quality

[[Page 74522]]

modeling) and each year from 2009 to 2014. These baseline inventories 
incorporate reductions from federal, State, and District measures 
adopted prior to 2007. 2008 PM2.5 Plan, p. B-1 and 2007 
State Strategy, Appendix A, p. 1. A winter inventory is provided 
because the majority of high PM2.5 days in the SJV occur 
during the winter months between November and February. 2008 
PM2.5 Plan, Figures H-4 and H-5.
    Table 1 is a summary of the average annual day inventories of 
direct PM2.5 and PM2.5 precursors for the 
baseline year of 2005 and the projected attainment year of 2014. These 
inventories provide the basis for the control measure analysis and the 
RFP and attainment demonstrations in the 2008 PM2.5 Plan.
    As a starting point for the 2008 PM2.5 Plan's 
inventories, the District used CARB's 2002 base year inventory. An 
example of this inventory and CARB's documentation for its inventories 
can be found in Appendices A and F, respectively, of the 2007 State 
Strategy. The 2002 inventory for the SJV was projected to 2005 and 
future years using CARB's California emissions forecasting system 
(CEFSv 1.06). 2008 PM2.5 Plan, p. B-1. Both base year and 
baseline inventories use the most current version of California's 
mobile source emissions model approved by EPA for use in SIPs, 
EMFAC2007, for estimating on-road motor vehicle emissions. 73 FR 3464 
(January 18, 2008). Off-road inventories were developed using the CARB 
off-road model.

         Table 1--San Joaquin Valley Emissions Inventory Summary for PM2.5 and PM2.5 Precursors for the 2005 Base Year and 2014 Attainment Year
                                                     [Annual average day emissions in tons per day]
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                    PM2.5              NOX               SO2               VOC              Ammonia
                Emissions inventory category                 -------------------------------------------------------------------------------------------
                                                                2005     2014     2005     2014     2005     2014     2005     2014     2005      2014
--------------------------------------------------------------------------------------------------------------------------------------------------------
Stationary Sources..........................................     13.3     14.4     80.1     56.5     20.4     22.0    121.5    129.5      19.8      23.0
Area Sources................................................     51.5     45.2     13.5     10.7      0.9      0.9    140.7    128.0     355.9     423.1
On-Road Mobile Sources......................................     12.1      8.9    327.9    206.7      2.6      0.7     94.8     57.2       6.2       4.8
Off-Road Mobile Sources.....................................      9.0      6.6    153.9    102.2      2.4      0.8     62.7     48.5       0         0
                                                             -------------------------------------------------------------------------------------------
    Total...................................................     86.0     75.0    575.4    376.2     26.4     24.5    419.8    363.2     382.0     451.0
--------------------------------------------------------------------------------------------------------------------------------------------------------

3. Proposed Action on the Emissions Inventories
    We have reviewed the emissions inventories in the 2008 
PM2.5 Plan and the inventory methodologies used by SJVAPCD 
and CARB for consistency with CAA requirements, the PM2.5 
implementation rule, and EPA's guidance. We find that the base year and 
projected baseline year inventories are comprehensive, accurate, and 
current inventories of actual or projected emissions of 
PM2.5 and PM2.5 precursors in the SJV 
nonattainment area as of the date of their submittal. We propose, 
therefore, to approve these inventories as meeting the requirements of 
CAA section 172(c)(3), the PM2.5 implementation rule and 
applicable EPA guidance. We provide more detail on our review of the 
inventories in section II.A. of the TSD.

C. Reasonably Available Control Measures/Reasonably Available Control 
Technology Demonstration and Adopted Control Strategy

1. Requirements for RACM/RACT
    CAA section 172(c)(1) requires that each attainment plan ``provide 
for the implementation of all reasonably available control measures 
[RACM] as expeditiously as practicable (including such reductions in 
emissions from existing sources in the area as may be obtained through 
the adoption, at a minimum, of reasonably available control technology 
[RACT]), and shall provide for attainment of the national primary 
ambient air quality standards.'' EPA defines RACM as measures that a 
state finds are both reasonably available and contribute to attainment 
as expeditiously as practicable in its nonattainment area. Thus, what 
constitutes RACM/RACT in a PM2.5 attainment plan is closely 
tied to that plan's expeditious attainment demonstration. 40 CFR 
51.1010; 72 FR 20586 at 20612. States are required to evaluate RACM/
RACT for direct PM2.5 and all of its attainment plan 
precursors. 40 CFR 51.1002(c).
    For PM2.5 attainment plans, EPA is requiring a combined 
approach to RACM and RACT under subpart 1 of Part D of the CAA. Subpart 
1, unlike subparts 2 and 4, does not identify specific source 
categories for which EPA must issue control technology documents or 
guidelines, or identify specific source categories for state and EPA 
evaluation during attainment plan development. 72 FR 20586 at 20610. 
Rather, under subpart 1, EPA considers RACT to be part of an area's 
overall RACM obligation. Because of the variable nature of the 
PM2.5 problem in different nonattainment areas which may 
require states to develop attainment plans that address widely 
disparate circumstances, EPA determined not only that states should 
have flexibility with respect to RACT and RACM controls but also that 
in areas needing significant emission reductions to attain the 
standards, RACT/RACM controls on smaller sources may be necessary to 
reach attainment as expeditiously as practicable. 72 FR 20586 at 20612, 
20615. Thus, under the PM2.5 implementation rule, RACT and 
RACM are those reasonably available measures that contribute to 
attainment as expeditiously as practicable in the specific 
nonattainment area. 40 CFR 51.1010; 72 FR 20586 at 20612.
    Specifically, the PM2.5 implementation rule requires 
that attainment plans include the list of measures a state considered 
and information sufficient to show that the state met all requirements 
for the determination of what constitutes RACM/RACT in a specific 
nonattainment area. 40 CFR 51.1010(a). In addition, the rule requires 
that the state, in determining whether a particular emissions reduction 
measure or set of measures must be adopted as RACM/RACT, consider the 
cumulative impact of implementing the available measures and to adopt 
as RACM/RACT any potential measures that are reasonably available 
considering technological and economic feasibility if, considered 
collectively, they would advance the attainment date by one year or 
more. Any measures that are necessary to meet these requirements which 
are not already either federally promulgated, part of the state's SIP, 
or otherwise creditable in SIPs must be submitted in enforceable form 
as part of

[[Page 74523]]

a state's attainment plan for the area. 72 FR 20586 at 20614.
    A more comprehensive discussion of the RACM/RACT requirement for 
PM2.5 attainment plans and EPA's guidance for it can be 
found in the PM2.5 implementation rule preamble (72 FR 20586 
at 20609-20633) and in section II.D. of the TSD.
2. RACM/RACT Demonstration in the SJV PM[bdi2].[bdi5] SIP
    The 2008 PM2.5 Plan and the 2007 State Strategy are the 
latest in a series of air quality plans that the District and CARB have 
developed to provide for attainment of the federal air quality 
standards in the SJV. These planning efforts have resulted in a 
comprehensive set of rules and programs that address the vast majority 
of emissions sources in the Valley. Many of these District and State 
rules are among the most stringent in the nation.
    For the 2008 PM2.5 Plan and the 2007 State Strategy, the 
District, CARB, and the local agencies (through the SJV's eight 
metropolitan planning organizations (MPO)) each undertook a process to 
identify and evaluate potential reasonably available control measures 
that could contribute to expeditious attainment of the PM2.5 
standards in the SJV. We describe each agency's efforts below.
a. SJVAPCD's RACM/RACT Analysis and Adopted Control Strategy
    The District's RACM/RACT analysis, which focuses on stationary and 
area source controls, is described in Chapter 6 and Appendix I of the 
2008 PM2.5 Plan. To identify potential RACM/RACT, the 
District reviewed potential measures from a number of sources including 
EPA's list of potential control measures in the PM2.5 
implementation rule preamble (72 FR 20586 at 20621), measures in other 
nonattainment areas' plans, and measures suggested by the public during 
development of the 2008 PM2.5 Plan. 2008 PM2.5 
Plan, pp. 6-6 to 6-8. The identified potential measures, as well as 
existing District measures, are described by emissions inventory 
category in Appendix I. These measures address emissions of direct 
PM2.5, NOX and SO2. See 2008 
PM2.5 Plan, p. 6-8 and Appendix I. Potential RACM/RACT 
controls for VOC or ammonia were not specifically identified or 
evaluated.
    From the set of identified potential controls for PM2.5, 
NOX, and SO2, the District selected measures for 
adoption and implementation based on the technological feasibility and 
practicality of emissions controls, the potential magnitude and timing 
of emissions reductions, cost effectiveness, and other acceptable 
criteria. 2008 PM2.5 Plan, p. 6-7.
    After completing its RACM/RACT analysis for stationary and area 
sources under its jurisdiction, the District developed its ``Stationary 
Source Regulatory Implementation Schedule'' (2008 PM2.5 
Plan, Table 6-2) which gives the schedule for regulatory adoption and 
implementation of the selected RACM/RACT measures. The District also 
identified a number of source categories for which feasibility studies 
would be undertaken to refine the inventory and evaluate potential 
controls. These categories and the schedule for studying them are 
listed in Table 6-4 of the 2008 PM2.5 Plan.
    In the five years prior to the adoption of the 2008 
PM2.5 Plan, the SJVAPCD developed and implemented 
comprehensive plans to address attainment of the PM10 
standards (2003 PM10 Plan, approved 69 FR 30005 (May 26, 
2004)), the 1-hour ozone standards (2004 Extreme Ozone Attainment Plan, 
approved 75 FR 10420 (March 8, 2010)), and the 8-hour ozone standards 
(2007 Ozone Plan, submitted November 16, 2007). These plans for other 
NAAQS have resulted in the adoption by the District of many new rules 
and revisions to existing rules for stationary and area sources in the 
SJV. In general, the SJVAPCD's current rules are equivalent to or more 
stringent than those developed by other air districts. In addition to 
these stationary and area source measures, the District has also 
adopted an indirect source review rule, Rule 9510, to address increased 
indirect emissions from new industrial, commercial and residential 
developments. See SJVAPCD Rule 9510 ``Indirect Source Review,'' adopted 
December 15, 2005. EPA proposed to approve this rule as a revision to 
the California SIP on May 21, 2010. 75 FR 28509. The District also 
operates incentive grant programs including the Carl Moyer program,\12\ 
to accelerate turnover of existing stationary and mobile engines to 
cleaner units. 2008 PM2.5 Plan, Section 6.5.
---------------------------------------------------------------------------

    \12\ The Carl Moyer Memorial Air Quality Standards Attainment 
Program provides incentive grants for engines, equipment and other 
sources of pollution that are cleaner than required by 
federal,State, or local rules, providing early or extra emission 
reductions. Eligible projects include cleaner on-road, off-road, 
marine, locomotive and stationary agricultural pump engines. The 
program achieves near-term reductions in emissions of 
NOX, PM, and VOC.
---------------------------------------------------------------------------

    For the 2008 PM2.5 Plan, the District identified and 
committed to adopting and implementing 13 new control measures for 
direct PM2.5, NOX, and/or SO2. In 
Table 2 below, we list these measures, which mostly involve 
strengthening existing District rules, along with their anticipated and 
actual adoption, initial implementation, and final compliance dates. As 
can be seen from Table 2, the District has met its intended rulemaking 
schedule and has only two rule actions remaining (S-COM-6 and S-COM-
10). On Table 3, we list the expected emissions reductions from each 
measure. We note, however, that the District's commitment is only to 
the aggregate emissions reductions of direct PM2.5, 
NOX, and SO2 shown. See 2008 PM2.5 
Plan, p. 6-9 and SJVUAPCD Governing Board Resolution, p. 5. The 
reductions listed on Table 3 are those anticipated to be achievable 
from each measure at the time the 2008 PM2.5 Plan was 
adopted. Actual reductions from each measure once adopted may be 
greater or less than those anticipated. Finally, on Table 4 we give the 
current SIP submittal and approval status of the measures in the Plan.

                          Table 2--San Joaquin Valley Air Pollution Control District 2008 PM2.5 Plan Specific Rule Commitments
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                              Year
    Measure number &        District rule     Rule making completion    Actual adoption    Compliance  Actual compliance   reductions     Actual year
      description              number                  date                  date             date            date           start      reductions start
--------------------------------------------------------------------------------------------------------------------------------------------------------
S-AGR-1................  4103--Open Burning  2nd Q--2010............  April 2010........         2010  June 2010........         2009  2010
S-COM-1................  4320--Advanced      3rd Q--2008............  October 2008......         2012  July 2012 to              2012  July 2011
                          Emissions                                                                     January 2014.
                          Reductions for
                          Boilers, Steam
                          Generators and
                          Process Heaters
                          (> 5 MMBtu/hr).
S-COM-2................  4307--Boilers,      3rd Q--2008............  October 2008......         2012  July 2010 to              2012  July 2010
                          Steam Generators                                                              January 2016.
                          and Process
                          Heaters (2 to 5
                          MMBtu/hr).

[[Page 74524]]

 
S-COM-3................  4308--Boilers,      4th Q--2009............  December 2009.....         2011  January 2011.....         2011  January 2011
                          Steam Generators
                          and Process
                          Heaters (0.075 to
                          < 2 MM Btu/hr).
S-COM-5................  4703--Stationary    3rd Q--2007............  September 2007....         2012  January 2012.....         2012  July 2009
                          Gas Turbines.
S-COM-6................  Rule 4702--         4th Q--2010............  Scheduled for              2012  TBD..............         2012  TBD
                          Reciprocating                                December 2010.
                          Internal
                          Combustion
                          Engines.
S-COM-7................  4354--Glass         3rd Q--2008............  October 2008......         2009  PM10 & SOx--              2009  PM10 & SOx--June
                          Melting Furnaces.                           Under revision....                January 2011.                   2009
                                                                                                       NOX limits--                    NOX limits--
                                                                                                        January 2014-                   January 2011
                                                                                                        2018.
S-COM-9................  4902--Residential   1st Q--2009............  March 2009........    Attrition  Attrition........         2011  January 2010
                          Water Heaters.
S-COM-10...............  4905--Natural Gas-  4nd Q--2014............  TBD...............    Attrition  TBD..............         2015  TBD
                          Fired, Fan Type
                          Residential
                          Central Furnaces.
S-COM-14...............  4901--Wood Burning  3rd Q--2009............  October 2008......         2010  2008.............         2010  2008
                          Fireplaces and
                          Wood Burning
                          Heaters.
S-IND-9................  4692--Commercial    2nd Q--2009............  September 2009....         2011  January 2011.....         2011  January 2011
                          Charbroiling.
S-IND-21...............  4311--Flares......  2nd Q--2009............  June 2009.........         2010  July 2011........         2010  July 2011
M-TRAN-1...............  9410--Employer      4th Q--2009............  December 2009.....         2012  January 2012.....         2012  January 2012
                          Based Trip
                          Reduction Program.
--------------------------------------------------------------------------------------------------------------------------------------------------------
Source: 2008 PM2.5 Plan, Table 6-2. ``Actual'' information is taken from the individual rules as adopted or revised.


[[Page 74525]]


         Table 3--San Joaquin Valley Air Pollution Control District Estimated Emissions Reductions for 2008 PM2.5 Plan Specific Rule Commitments
                                                              (tons per average annual day)
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                NOX Emissions Reductions
---------------------------------------------------------------------------------------------------------------------------------------------------------
                                                               2009            2010            2011            2012            2013            2014
--------------------------------------------------------------------------------------------------------------------------------------------------------
S-AGR-1........................  4103--Open Burning.....            1.21            1.95            2.68            2.67            2.66            2.65
S-COM-1........................  4320--Advanced                        0               0               0            1.49            1.50            1.52
                                  Emissions Reductions
                                  for Boilers, Steam
                                  Generators and Process
                                  Heaters (> 5 MMBtu/hr).
S-COM-3........................  4308--Boilers, Steam                  0               0            0.12            0.27            0.39            0.55
                                  Generators and Process
                                  Heaters (0.075 to < 2
                                  MMBtu/hr).
S-COM-5........................  4703--Stationary Gas                  0               0               0            2.21            2.21            2.21
                                  Turbines.
S-COM-7........................  4354--Glass Melting                1.22            1.25            1.18            1.60            1.67            1.58
                                  Furnaces.
S-COM-9........................  4902--Residential Water               0               0            0.20            0.25            0.32            0.40
                                  Heaters.
S-COM-14.......................  4901--Wood Burning                    0            0.04            0.08            0.07            0.07            0.06
                                  Fireplaces and Wood
                                  Burning Heaters.
    Commitment to Total NOX      .......................            2.43            3.24            4.26            8.56            8.82            8.97
     Reductions.
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                               PM2.5 Emissions Reductions
--------------------------------------------------------------------------------------------------------------------------------------------------------
S-AGR-1........................  4103--Open Burning.....            1.60            2.57            3.53            3.52            3.50            3.49
S-COM-1........................  4320--Advanced                        0               0               0            0.23            0.24            0.24
                                  Emissions Reductions
                                  for Boilers, Steam
                                  Generators and Process
                                  Heaters (> 5 MMBtu/hr).
S-COM-14.......................  4901--Wood Burning                    0            0.39            0.76            0.73            0.71            0.69
                                  Fireplaces and Wood
                                  Burning Heaters.
S-IND-9........................  4692--Commercial                      0               0            2.17            2.21            2.25            2.28
                                  Charbroiling.
    Commitment to Total PM2.5    .......................            1.60            2.96        4.46 \1\            6.69            6.70            6.70
     Reductions.
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                SO2 Emissions Reductions
--------------------------------------------------------------------------------------------------------------------------------------------------------
S-AGR-1........................  4103--Open Burning.....            0.06            0.10            0.14            0.14            0.14            0.14
S-COM-1........................  4320--Advanced                        0               0               0            0.76            0.76            0.76
                                  Emissions Reductions
                                  for Boilers, Steam
                                  Generators and Process
                                  Heaters (> 5 MMBtu/hr).
S-COM-14.......................  4901--Wood Burning                    0            0.01            0.02            0.02            0.02            0.02
                                  Fireplaces and Wood
                                  Burning Heaters.
M-TRAN-1.......................  9410--Employer Based                TBD             TBD             TBD             TBD             TBD             TBD
                                  Trip Reduction
                                  Programs.
    Commitment to Total SO2      .......................            0.06            0.11            0.16            0.92            0.92            0.92
     Reductions.
--------------------------------------------------------------------------------------------------------------------------------------------------------
This column sums to 6.46 tpd. Because the 4.46 tpd figure is given in Table 6-3b in the 2008 PM2.5 Plan and used in the attainment demonstration in
  Table 9-1 in the Plan, we are assuming that it reflects the District's intended emissions reductions commitment.


[[Page 74526]]


 Table 4--SIP Submittal and Approval Status of SJVAPCD Rules in the 2008
                               PM2.5 Plan
------------------------------------------------------------------------
 
------------------------------------------------------------------------
Rule 4103--Open Burning (Phase  Not submitted....  Most current revision
 IV).                                               of rule approved:
                                                    May 17, 2007 at 74
                                                    FR 57907 (November
                                                    10, 2009)
4320--Advanced Emissions        Submitted........  Submittal date: March
 Reductions for Boilers, Steam                      17, 2009 Submittal
 Generators and Process                             found complete:
 Heaters (> 5 MMBtu/hr).                            April 20, 2009 New
                                                    rule
Rule 4307 Boilers, Steam        Approved.........  75 FR 1715 (January
 Generators and Process                             13, 2010)
 Heaters (2 to 5 MMBtu/hr).
Rule 4308 Boilers, Steam        Submitted........  Submittal date: May
 Generators and Process                             17, 2010 Submittal
 Heaters (0.075 to < 2 MMBtu/                       found complete: June
 hr).                                               8, 2010 Most current
                                                    revision of rule
                                                    approved: October
                                                    20, 2005 at 72 FR
                                                    29887 (May 30, 2007)
Rule 4703 Stationary Gas        Approved.........  74 FR 53888 (October
 Turbines.                                          21, 2009)
Rule 4702 Reciprocating         Under              Most current revision
 Internal Combustion Engines     development,       of rule approved:
 (2010 revisions).               expected           January 18, 2007 73
                                 adoption           FR 1819 (January 10,
                                 December 2010.     2008)
Rule 4354 Glass Melting         Not Submitted....  Most current revision
 Furnaces (2008 revisions).                         of rule approved:
                                                    August 17, 2006 at
                                                    72 FR 41894 (August
                                                    1, 2007)
Rule 4902 Residential Water     Approved.........  75 FR 24408 (May 5,
 Heaters.                                           2010)
4905--Natural Gas-Fired, Fan    Adoption           Most current version
 Type Residential Central        scheduled for      of the rule
 Furnaces.                       2014.              approved: October
                                                    20, 2005 at 72 FR
                                                    29886 (May 30, 2007)
Rule 4901 Wood Burning          Approved.........  74 FR 57907 (November
 Fireplaces and Wood Burning                        10, 2009)
 Heaters.
Rule 4692 Commercial            Submitted........  Submittal date: May
 Charbroiling.                                      17, 2010
                                                   Submittal found
                                                    complete: June 8,
                                                    2010
                                                   Most current revision
                                                    of rule approved:
                                                    March 21, 2002 at 68
                                                    FR 33005 (June 3,
                                                    2003)
Rule 4311 Flares..............  Submitted........  Submittal date:
                                                    January 10, 2010
                                                   Submittal found
                                                    complete: February
                                                    4, 2010
                                                   Most current revision
                                                    of rule approved:
                                                    June 20, 2002 at 68
                                                    FR 8835 (February
                                                    26, 2003)
Rule 9410 Employer Based Trip   Submitted........  Submittal date: May
 Reduction Program.                                 17, 2010
                                                   Submittal found
                                                    complete: June 8,
                                                    2010 New rule.
------------------------------------------------------------------------

b. CARB's RACM Analysis and Adopted Control Strategy
    Source categories for which CARB has primary responsibility for 
reducing emissions in California include most new and existing on- and 
off-road engines and vehicles, motor vehicle fuels, and consumer 
products. In addition, California has unique authority under CAA 
section 209 (subject to a waiver by EPA) to adopt and implement new 
emission standards for many categories of on-road vehicles and engines 
and new and in-use off-road vehicles and engines.
    Given the need for significant emissions reductions from mobile and 
area sources to meet the NAAQS in California nonattainment areas, the 
State of California has been a leader in the development of some of the 
most stringent control measures nationwide for on-road and off-road 
mobile sources and the fuels that power them. These standards have 
reduced new car emissions by 99 percent and new truck emissions by 90 
percent from uncontrolled levels. 2007 State Strategy, p. 37. The State 
is also working with EPA on goods movement activities and is 
implementing programs to reduce emissions from ship auxiliary engines, 
locomotives, harbor craft and new cargo handling equipment. In 
addition, the State has standards for lawn and garden equipment, 
recreational vehicles and boats, and other off-road sources that 
require newly manufactured equipment to be 80-98 percent cleaner than 
their uncontrolled counterparts. Id. Finally, the State has adopted 
many measures that focus on achieving reductions from in-use mobile 
sources that include more stringent inspection and maintenance 
requirements in California's Smog Check program, truck and bus idling 
restrictions, and various incentive programs. Since 1994 alone, the 
State has taken more than 45 rulemaking actions and achieved most of 
the emissions reductions needed for attainment in the State's 
nonattainment areas. See 2007 State Strategy, pp. 36-40. As is noted in 
the 2007 State Strategy, EPA has approved California's mobile source 
program as representing best available control measures. See 2007 State 
Strategy, Appendix G, 69 FR 5412 (February 4, 2004) and 69 FR 30006 
(May 26, 2004) (proposed and final approval of SJV 2003 PM10 
Plan).
    CARB developed its proposed 2007 State Strategy after an extensive 
public consultation process to identify potential SIP measures. This 
process is described in the 2008 PM2.5 Plan at 7-11.\13\ 
From this process, CARB identified and committed to propose 15 new 
defined measures. These measures focus on cleaning up the in-use fleet 
as well as increasing the stringency of emissions standards for a 
number of engine categories, fuels, and consumer products. Many, if not 
most, of these measures are being proposed for adoption for the first 
time anywhere in the nation. They build on CARB's already comprehensive 
program described above that addresses emissions from all types of 
mobile sources and consumer products, through both regulations and 
incentive programs. See Appendix A of the TSD. Table 5 below lists the 
new defined measures in the 2007 State Strategy, which also include one 
measure each from the California Bureau of Automotive Repair and the 
California Department of Pesticide Regulation. As shown in this table, 
the State has adopted many of the measures.
---------------------------------------------------------------------------

    \13\ More information on this public process including 
presentations from the workshops and symposium that proceeded 
adoption of the 2007 State Strategy can be found at http://www.arb.ca.gov/planning/sip/2007sip/2007sip.htm.

[[Page 74527]]



          Table 5--2007 State Strategy Defined Measures Scheduled for Consideration and Current Status
----------------------------------------------------------------------------------------------------------------
                                     Primary area  (SC  and/
       Defined state measure                or  SJV)              Adoption year             Current status
----------------------------------------------------------------------------------------------------------------
Smog Check Improvements............  Both..................  2007-2008.............  Elements approved 75 FR
                                                                                      38023 (July 1, 2010).
Expanded Vehicle Retirement........  Both..................  2008-2014.............  Adopted CARB June 2009;
                                                                                      Bureau of Automotive
                                                                                      Repair September 2010.
Revisions to Reformulated Gasoline   Both..................  2007..................  Approved, see 75 FR 26653
 Program.                                                                             (May 2, 2010).
Cleaner In-use Heavy Duty Trucks...  Both..................  2008..................  Adopted 2008, pending
                                                                                      revisions.
Auxiliary Ship Cold Ironing and      SC....................  2007-2008.............  Adopted December 2007.
 Other Clean Technologies.
Cleaner Main Ship Engines and Fuels  SC....................  Fuel: 2007............  Adopted July 2007.
                                                             Engines: 2009.........
Port Truck Modernization...........  SC....................  2007-2008.............  Adopted December 2007 and
                                                                                      December 2008.
Accelerated Introduction of Cleaner  Both..................  2007-2008.............  In progress.
 Locomotives.
Clean Up Existing Harbor Crafts....  SC....................  2007..................  Adopted November 2007,
                                                                                      revised June 2010.
Cleaner In-Use Off-Road Engines....  Both..................  2007..................  Adopted 2007, pending
                                                                                      revisions.
Cleaner In-Use Agricultural          SJV...................  2009..................  On-going through incentive
 Equipment.                                                                           grant programs.
New Emissions Standards for          Both..................  2009-2010.............  Partial adoption, 2008;
 Recreational Boats.                                                                  additional regulation in
                                                                                      public review.
Expanded Off-Road Recreational       Both..................  By 2010...............  Adopted November 2008.
 Vehicle Emissions Standards.
Enhanced Vapor Recovery for Above    Both..................  2007..................  Adopted June 2007.
 Ground Storage Tanks.
Additional Evaporative Emissions     Both..................  By 2010...............  Partial adoption, 2008.
 Standards.
Consumer Products Program (I & II).  Both..................  2008 & 2010-2012......  Phase I--Approved 74 FR
                                                                                      57074 (November 4, 2009).
Department of Pesticide Regulation.  SJV...................  2008..................  Adopted 2008, amended 2009.
----------------------------------------------------------------------------------------------------------------
SC = South Coast Air Basin. Source: 2009 State Strategy Status Report, p. 23 (footnotes in original not
  included)

    Appendix A of the TSD includes a list of all measures adopted by 
CARB between 1990 and the beginning of 2007. These measures, reductions 
from which are reflected in the Plan's baseline inventories, fall into 
two categories: Measures that are subject to a waiver of Federal pre-
emption under CAA section 209 (section 209 waiver measures or waiver 
measures) and those for which the State is not required to obtain a 
waiver (non-waiver measures). Emissions reductions from waiver measures 
are fully creditable in attainment and RFP demonstrations and may be 
used to meet other CAA requirements, such as contingency measures. See 
EPA's proposed approval of the SJV 1-Hour Ozone Plan at 74 FR 33933, 
33938 (July 14, 2009) and final approval at 75 FR 10420 (March 8, 
2010). The State's baseline non-waiver measures have generally all been 
approved by EPA into the SIP and as such are fully creditable for 
meeting CAA requirements.
    In addition to the State's commitments to propose defined measures, 
the 2007 State Strategy includes enforceable commitments for direct 
PM2.5, NOX, and VOC emissions reductions from 
mobile source categories that are crucial for attainment of the 
PM2.5 NAAQS in the San Joaquin Valley. For the SJV, the 2007 
State Strategy includes State commitments to achieve 5 tpd of direct 
PM2.5, 76 tpd of NOX, and 23 tpd of VOC 
reductions. See 2007 State Strategy, p. 63 and CARB Resolution 07-28, 
Attachment B, p. 6. The 2007 State Strategy indicates that the State 
expects to achieve these emissions reductions in the San Joaquin Valley 
by the projected attainment year of 2014 from the measures listed in 
Table 5 or other similar measures. In the 2007 State Strategy, CARB 
provides an estimated emissions reduction for each measure to show 
that, when considered together, these measures can meet the total 
commitment. CARB states, however, that its enforceable commitment is to 
achieve the aggregate emissions reductions for each pollutant by the 
given dates and not for a specific level of reductions from any 
specific measure. See 2007 State Strategy, p. 58. A summary of the 
estimates from the proposed measures is provided in Table 6 below.
    As mentioned above, CARB's commitment is also to propose specific 
new measures that are identified and defined in the 2007 Strategy 
State. See 2007 State Strategy, pp. 64-65 and 2009 State Strategy 
revisions, pp. 22-23.

   Table 6--Expected Emissions Reductions from Defined Measures in the 2007 State Strategy for the San Joaquin
                                            Valley 2014 Tons Per Day
----------------------------------------------------------------------------------------------------------------
                             Measure                                   PM2.5            NOX             VOC
----------------------------------------------------------------------------------------------------------------
Smog Check Improvements (BAR)...................................            0.05             3.3             2.9
Expanded Vehicle Retirement.....................................            0.01             0.5             0.7
Modifications to Reformulated Gasoline Program..................              --              --             2.9
Cleaner In-Use Heavy-Duty Trucks................................             3.6            61.4             6.4

[[Page 74528]]

 
Accelerated Intro. Of Cleaner Line-Haul Locomotives.............             0.2             7.2             0.5
Cleaner In-Use Off-Road Equipment (>25hp).......................             0.8             3.7             0.9
Cleaner In-Use Agricultural Equipment...........................             NYQ             NYQ             NYQ
New Emission Standards for Recreational Boats...................              --             0.1             1.3
Expanded Off-Road Recreational Vehicle Emissions Standards......              --              --             2.2
Consumer Products Program.......................................              --              --             3.2
Pesticides......................................................              --              --             2.5
Totals:.........................................................               5              76              23
----------------------------------------------------------------------------------------------------------------
Source: 2009 State Strategy Status Report, p. 6. Only defined measures with reductions in the SJV are shown
  here.
NYQ = Not yet quantified.

c. The Local Jurisdictions' RACM Analysis
    The local jurisdictions' RACM analysis was conducted by the SJV's 
eight MPOs.\14\ This analysis focused on potential NOX 
emissions reductions from transportation control measures (TCM). TCMs 
are, in general, measures designed to reduce emissions from on-road 
motor vehicles through reductions in vehicle miles traveled or traffic 
congestion. The analysis' results are described in Chapter 7 (pp. 7-8 
to 7-11) of the 2008 PM2.5 Plan. It addressed NOX 
but not direct PM2.5, SO2, or VOC.
---------------------------------------------------------------------------

    \14\ These eight MPOs represent the eight counties in the San 
Joaquin Valley nonattainment area: The San Joaquin Council of 
Governments, the Stanislaus Council of Governments, the Merced 
County Association of Governments, the Madera County Transportation 
Commission, the Council of Fresno County Governments, Kings County 
Association of Governments, the Tulare County Association of 
Governments and the Kern Council of Governments.
---------------------------------------------------------------------------

    For the 2008 PM2.5 Plan, the SJV MPOs reviewed and 
updated the RACM analysis they performed for the SJV 2007 [8-hour] 
Ozone Plan, based on EPA's guidance in the preamble to the 
PM2.5 implementation rule. For the 2007 Ozone Plan, they 
developed a local RACM strategy after an extensive evaluation of 
potential RACM for advancing the 8-hour ozone standard attainment date. 
After reviewing the 2007 Ozone Plan's local RACM analysis, EPA's 
suggested RACM, recently-developed plans from other areas, and the 
potential emission reductions available from the implementation of TCMs 
in the SJV, the MPOs determined that there were no additional local 
RACM for NOX, beyond those measures already adopted, that 
could advance attainment of the PM2.5 NAAQS in the SJV. 2008 
PM2.5 Plan, p. 7-11.
3. Proposed Actions on RACM/RACT Demonstration and Adopted Control 
Strategy
    Under the PM2.5 implementation rule, RACM/RACT are the 
set of measures necessary for expeditious attainment. The measures must 
address emissions of PM2.5 and all PM2.5 
attainment plan precursors that are necessary for such expeditious 
attainment. Thus, in order for a PM2.5 plan to demonstrate 
that it provides for RACM/RACT, it must also demonstrate that it 
provides for expeditious attainment. 72 FR 20586 at 20612-20623. As 
discussed in section IV.D.2. below, we are proposing to disapprove the 
air quality modeling in the 2008 PM2.5 plan because there is 
insufficient documentation for us to determine its adequacy. Air 
quality modeling establishes the level of emissions reductions needed 
for attainment in an area. Thus, uncertainties about the adequacy of 
the air quality modeling result in uncertainties regarding the 
emissions reductions needed for attainment. Without a reliable estimate 
of the emission reductions needed for attainment, we are unable to 
determine if the measures in the 2008 PM2.5 Plan include all 
RACM/RACT that will provide for attainment of the PM2.5 
NAAQS in the San Joaquin Valley as expeditiously as practicable.
    In addition, as described in section IV.D.3. below, EPA is 
proposing to determine that VOC is a PM2.5 attainment plan 
precursor in the SJV nonattainment area. Under the PM2.5 
implementation rule, States must address all PM2.5 
attainment plan precursors in their RACM/RACT analyses. See 40 CFR 
51.1002(c)(3). Neither the District nor the local jurisdictions 
(through the MPOs) evaluated potential RACM/RACT for VOC emission 
sources.
    For these reasons, EPA is proposing to find that the 2008 
PM2.5 Plan, together with the revised 2007 State Strategy, 
does not provide for the implementation of RACM/RACT as required by CAA 
section 172(c)(1) and 40 CFR 51.1010 and to disapprove the SJV 
PM2.5 SIP's RACM/RACT demonstration. It appears, however, 
that the State, District, and local jurisdictions have identified and 
otherwise provided for the implementation of a comprehensive set of 
measures that are among the most stringent in the nation and, should 
the District and State correct the deficiencies in the attainment 
demonstration and appropriately address VOC as an attainment plan 
precursor in its RACM/RACT demonstration, we may be able to approve the 
SIP's RACM/RACT demonstration.
    Because they will strengthen the California SIP, we are proposing 
to approve the SJVAPCD's commitments to adopt and implement specific 
control measures on the schedule identified in Table 6-2 (as amended 
June 15, 2010) in the 2008 PM2.5 Plan, to the extent that 
these commitments have not yet been fulfilled, and to achieve specific 
aggregate emissions reductions of direct PM2.5, 
NOX and SOx by specific years as given in Table 
6-3 of the 2008 PM2.5 Plan.
    We are also proposing to approve, as a SIP strengthening measure, 
CARB's commitments to propose certain defined measures, as given on 
page 23 of the 2009 State Strategy Status Report, and to achieve 
aggregate emissions reductions of 5 tpd direct PM2.5, 76 tpd 
NOx, and 23 tpd VOC in the San Joaquin Valley by 2014 as 
given on page 21 of the 2009 State Strategy Status Report.

D. Attainment Demonstration

1. Requirements for Attainment Demonstrations
    CAA section 172 requires a State to submit a plan for each of its 
nonattainment areas that demonstrates attainment of the applicable 
ambient air quality standard as expeditiously as practicable but no 
later than the specified attainment date. Under the PM2.5 
implementation rule, this demonstration should consist of four parts:
    (1) Technical analyses that locate, identify, and quantify sources 
of

[[Page 74529]]

emissions that are contributing to violations of the PM2.5 
NAAQS;
    (2) Analyses of future year emissions reductions and air quality 
improvement resulting from already-adopted national, state, and local 
programs and from potential new state and local measures to meet the 
RACM/RACT and RFP requirements in the area;
    (3) Adopted emissions reduction measures with schedules for 
implementation; and
    (4) Contingency measures required under section 172(c)(9) of the 
CAA.
    See 40 CFR 51.1007; 72 FR 20586 at 20605.
    The requirements for the first two parts are described in the 
sections on emissions inventories and RACM/RACT above (sections IV.B. 
and IV.C.) and in the sections on air quality modeling, 
PM2.5 precursors, extension of the attainment date, and 
attainment demonstration that follow immediately below. Requirements 
for the third and fourth parts are described in the sections on the 
control strategy and contingency measures (sections IV.C. and IV.F.), 
respectively.
2. Air Quality Modeling in the SJV 2008 PM2.5 Plan
    The PM2.5 implementation rule requires states to submit 
an attainment demonstration based on modeling results. Specifically, 40 
CFR 51.1007(a) states:

    For any area designated as nonattainment for the 
PM2.5 NAAQS, the State must submit an attainment 
demonstration showing that the area will attain the annual and 24-
hour standards as expeditiously as practicable. The demonstration 
must meet the requirements of Sec.  51.112 and Appendix W of this 
part and must include inventory data, modeling results, and emission 
reduction analyses on which the State has based its projected 
attainment date. The attainment date justified by the demonstration 
must be consistent with the requirements of Sec.  51.1004(a). The 
modeled strategies must be consistent with requirements in Sec.  
51.1009 for RFP and in Sec.  51.1010 for RACT and RACM. The 
attainment demonstration and supporting air quality modeling should 
be consistent with EPA's PM2.5 modeling guidance.\15\

    \15\ EPA's modeling guidance can be found in ``Guideline on Air 
Quality Models'' in 40 CFR part 51, Appendix W and ``Guidance on the 
Use of Models and Other Analyses for Demonstrating Attainment of Air 
Quality Goals for the 8-Hour Ozone and PM2.5 NAAQS and 
Regional Haze'', EPA-454/B-07-002, April 2007.
---------------------------------------------------------------------------

See also, 72 FR 20586 at 20665.
    Air quality modeling is used to establish emissions attainment 
targets, the combination of emissions of PM2.5 and 
PM2.5 precursors that the area can accommodate without 
exceeding the NAAQS, and to assess whether the proposed control 
strategy will result in attainment of the NAAQS. Air quality modeling 
is performed for a base year and compared to air quality monitoring 
data in order to determine model performance. Once the performance is 
determined to be acceptable, future year changes to the emissions 
inventory are simulated to determine the relationship between emissions 
reductions and changes in ambient air quality throughout the air basin.
    The procedures for modeling PM2.5 as part of an 
attainment SIP are contained in EPA's ``Guidance on the Use of Models 
and Other Analyses for Demonstrating Attainment of Air Quality Goals 
for the 8-Hour Ozone and PM2.5 NAAQS and Regional Haze.'' A 
brief description of the modeling in 2008 PM2.5 Plan and our 
concerns regarding it follows. More detailed information about the 
modeling is available in section II.D. of the TSD.
    CARB and the District jointly performed the air quality modeling 
for the 2008 PM2.5 Plan. Significant time, money, and effort 
by CARB, the District, and many others have gone into preparing the air 
quality modeling to support the attainment demonstration in the 2008 
PM2.5 Plan for the San Joaquin Valley, including support for 
the multi-million dollar California Regional Particulate Air Quality 
Study (CRPAQS). CRPAQS is a cooperative effort involving California 
cities; State and local and air pollution control agencies, federal 
agencies, industry groups, academics, and contractors. Field data for 
CRPAQS were collected during the 14 months from December 1999 through 
February 2001 and included short-term, intensive monitoring during the 
fall and winter. The study's design placed emphasis on collecting 
sufficient continuous air quality and meteorological data, both at the 
surface and aloft, to support receptor and photochemical modeling. Data 
and modeling results based on the CRPAQS study provided solid 
underpinnings for the 2008 PM2.5 Plan.
    The 2008 PM2.5 Plan uses multiple modeling analyses to 
demonstrate attainment of the PM2.5 NAAQS in the SJV. It 
mainly relies on several variants of an approach based on receptor 
modeling for the annual PM2.5 NAAQS. This approach begins 
with Chemical Mass Balance (CMB) modeling, which distinguishes the 
ambient PM2.5 contributions of several broad emissions 
source categories based on how they match the chemical species 
components of PM2.5 measurements. The CMB results are then 
refined with emissions inventory data to distinguish additional source 
categories; an area of influence analysis to better reflect particular 
sources affecting a monitor; and information from past photochemical 
modeling to assess how secondarily-formed PM2.5 will respond 
to changes in precursor emissions. Several variants of this approach 
were used with CMB results from different locations and different base 
case years. This modeling only addresses the annual PM2.5 
standard.
    The receptor modeling approaches are supplemented with an 
attainment demonstration using photochemical modeling with the 
Community Multiscale Air Quality (CMAQ) model. This modeling 
incorporates data collected during CRPAQS. The CMAQ modeling addresses 
both the annual and 24-hour PM2.5 standards.
    EPA recommends that States prepare modeling/analysis protocols as 
part of their modeled attainment demonstrations. Guidance, p. 133. The 
Guidance at pp. 133-134 describes the topics to be addressed in this 
modeling protocol. A modeling protocol should detail and formalize the 
procedures for conducting all phases of the modeling analysis, such as 
describing the background and objectives, creating a schedule and 
organizational structure, developing the input data, conducting model 
performance evaluations, interpreting modeling results, describing 
procedures for using the model to demonstrate whether proposed 
strategies are sufficient to attain the NAAQS, and producing 
documentation to be submitted for EPA Regional Office review and 
approval prior to actual modeling.
    The 2008 PM2.5 Plan's modeling protocol is contained in 
Appendix F and includes descriptions of both the receptor modeling 
approaches and the photochemical modeling. Additional description of 
the photochemical modeling is also covered in Appendix G, and also in 
the additional appendix entitled ``Regional Model Performance 
Analysis'' (RMPA). The protocol covers all of the topics recommended in 
the Guidance, except that it does not identify how modeling and other 
analyses will be archived or made available to the public. See 
Guidance, p. 117.
    The 2008 PM2.5 Plan's air quality model performance is 
discussed in the RMPA, starting at p. 6. Overall, modeling performance 
is not sufficiently documented for EPA to fully evaluate it. While 
substantial effort went into preparing the materials for model 
evaluation, the 2008 PM2.5 Plan has relatively little 
discussion of the evaluation results and no discussion of sensitivity 
or diagnostic testing, both of

[[Page 74530]]

which are necessary for confidence in the model and the performance 
statistics presented. Without such testing, it cannot be determined if 
the model is adequately simulating the physical and chemical processes 
leading to PM2.5 in the atmosphere and if the model will 
respond in a scientifically reasonable way to emissions changes. Also 
insufficiently documented are the Plan's deviations from EPA's guidance 
on performing the Speciated Modeled Attainment Test (SMAT). Although, 
the Plan cites several factors as justifying such deviations (e.g., the 
prevalence of ammonia, the dominance of ammonium nitrate, the effect of 
substantial controls on fugitive dust and direct carbon emissions (p. 
G-10 and p. 3-20)), it does not provide sufficiently detailed 
explanations for EPA to understand exactly what these deviations are or 
to judge whether these deviations are acceptable. Another example of 
insufficient documentation is that the Relative Reduction Factors, 
which are the key results from the model for use in the attainment 
test, and details of their calculation, are not presented in the 2008 
PM2.5 Plan. Given this lack of documentation, EPA cannot 
determine at this time whether the attainment tests are adequate and 
meet EPA guidance.
    In addition to a modeled attainment demonstration, which focuses on 
locations with an air quality monitor, EPA's Guidance requires an 
unmonitored area analysis. This analysis is intended to ensure that a 
control strategy leads to reductions in PM2.5 at other 
locations that have no monitor but that might have baseline (and 
future) ambient PM2.5 levels exceeding the NAAQS. The 
unmonitored area analysis uses a combination of model output and 
ambient data to identify areas that might exceed the NAAQS if monitors 
were located there. The analysis should include, at a minimum, all 
counties designated nonattainment and the counties surrounding the 
nonattainment area. In order to examine unmonitored areas in all 
portions of the modeling domain, EPA recommends use of interpolated 
spatial fields of ambient data combined with gridded modeled outputs. 
Guidance, p. 29.
    In lieu of an unmonitored area analysis, the 2008 PM2.5 
Plan section entitled ``Unmonitored peaks'' presents a simple screening 
analysis. This consists of a filled concentration contour plot (Figure 
3 on p. G-20), and the observation that ``there are no areas with steep 
gradients that would result in higher design values than those measured 
at monitors.'' 2008 PM2.5 Plan, p. G-15. This analysis 
departs significantly from the procedures recommended in the Guidance 
and does not adequately substitute for an unmonitored area analysis 
consistent with the procedures recommended in the Guidance. Without an 
unmonitored area analysis, EPA cannot determine whether emission 
reductions in the Plan are sufficient for attainment of the NAAQS at 
locations without an air quality monitor.
    In summary, the 2008 PM2.5 Plan lacks or fails to 
adequately document several significant elements of a modeling 
demonstration including: a provision for access to the underlying 
modeling data, the sensitivity and diagnostic testing of the air 
quality model, a discussion of the relative reduction factors, and an 
unmonitored area analysis. While the modeling appears to be essentially 
sound, the documentation provided in the 2008 PM2.5 Plan is 
not sufficient for EPA to fully evaluate its adequacy. An attainment 
demonstration must demonstrate, i.e. document with evidence and 
analyses, that the controls will result in attainment. Without 
sufficient documentation, the Plan states but does not adequately 
demonstrate that it provides for attainment of the PM2.5 
standards in the SJV. Although it is not necessary to provide 
comprehensive documentation on every single facet of a modeling 
analysis, the level of documentation in the Plan falls significantly 
short of what is necessary for a reliable attainment demonstration, as 
described in the EPA's modeling guidance. Given the lack of 
documentation and the absence of an unmonitored area analysis, EPA 
cannot at this time propose to approve the Plan's air quality modeling. 
We also cannot determine at this time that the modeling provides an 
adequate basis for the RACM/RACT, RFP, and attainment demonstrations in 
the Plan.
3. PM2.5 Attainment Plan Precursors
    EPA recognizes NOX, SO2, VOCs, and ammonia as 
the main precursor gases associated with the formation of secondary 
PM2.5 in the ambient air. These gas-phase PM2.5 
precursors undergo chemical reactions in the atmosphere to form 
secondary particulate matter. Formation of secondary PM2.5 
depends on numerous factors including the concentrations of precursors; 
the concentrations of other gaseous reactive species; atmospheric 
conditions including solar radiation, temperature, and relative 
humidity; and the interactions of precursors with preexisting particles 
and with cloud or fog droplets. 72 FR 20586 at 20589.
    As discussed previously, a state must submit emissions inventories 
for each of the four PM2.5 precursor pollutants. 72 FR 20586 
at 20589 and 40 CFR 51.1008(a)(1). However, the overall contribution of 
different precursors to PM2.5 formation and the 
effectiveness of alternative potential control measures will vary by 
area. Thus, the precursors that a state should regulate to attain the 
PM2.5 NAAQS could also vary to some extent from area to 
area. 72 FR 20586 at 20589.
    In the PM2.5 implementation rule, EPA did not make a 
finding that all potential PM2.5 precursors must be 
controlled in each specific nonattainment area. See 72 FR 20586 at 
20589. Instead, for reasons explained in the rule's preamble, a state 
must evaluate control measures for sources of SO2 in 
addition to sources of direct PM2.5 in all nonattainment 
areas. 40 CFR 51.1002(c) and (c)(1). A state must also evaluate control 
measures for sources of NOX unless the state and/or EPA 
determine that control of NOX emissions would not 
significantly reduce PM2.5 concentrations in the specific 
nonattainment area. 40 CFR 51.1002(c)(2). In contrast, EPA has 
determined in the PM2.5 implementation rule that a state 
does not need to address controls for sources of VOC and ammonia unless 
the state and/or EPA make a technical demonstration that such controls 
would significantly contribute to reducing PM2.5 
concentrations in the nonattainment area. 40 CFR 51.1002(c)(3) and (4). 
Such a demonstration is required ``if the administrative record related 
to development of its SIP shows that the presumption is not technically 
justified for that area.'' 40 CFR 51.1002(c)(5).
    ``Significantly contributes'' in this context means that a 
significant reduction in emissions of the precursor from sources in the 
area would be projected to provide a significant reduction in 
PM2.5 concentrations in the area. 72 FR 20586 at 20590. 
Although EPA did not establish a quantitative test for determining what 
constitutes a significant change, EPA noted that even relatively small 
reductions in PM2.5 levels are estimated to result in 
worthwhile public health benefits. Id.
    EPA further explained that a technical demonstration to reverse the 
presumption for NOX, VOC, or ammonia in any area could 
consider the emissions inventory, speciation data, modeling 
information, or other special studies such as monitoring of additional 
compounds, receptor modeling, or special monitoring studies. 72 FR 
20586 at 20596-20597. These factors could indicate that the emissions 
or ambient

[[Page 74531]]

concentration contributions of a precursor, or the sensitivity of 
ambient concentrations to changes in precursor emissions, differs for a 
specific nonattainment area from the presumption for that precursor in 
the PM2.5 implementation rule.
    The SJV 2008 PM2.5 Plan does not explicitly identify the 
pollutants that have been selected as PM2.5 attainment plan 
precursors as defined in 40 CFR 51.1000. The Plan addresses only 
NOX and SO2 in the RFP and attainment 
demonstrations and in the District's RACM/RACT analysis, and thereby 
implicitly identifies NOX and SO2, but not VOC or 
ammonia, as attainment plan precursors. It does include supporting 
documentation for the inclusion of NOX as an attainment plan 
precursor and for the exclusion of ammonia. However, as discussed 
below, it does not fully evaluate the impact of controlling VOC as a 
precursor for PM2.5 attainment, even though other 
information in the Plan indicates that controlling VOC, in addition to 
SO2 and NOX, may contribute significantly to 
reductions in ambient PM2.5 levels in the SJV.
    As mentioned above, ambient contribution and ambient sensitivity to 
emissions changes may both be considered in determining whether the 
presumption for an attainment plan precursor should be reversed. The 
2008 PM2.5 Plan contains numerous qualitative statements 
that San Joaquin Valley's ambient PM2.5 levels are dominated 
by ammonium nitrate, and that NOX reductions are more 
effective at reducing ambient PM2.5 than reductions in the 
other precursors. Most of those statements are in Chapter 3 and 
Appendix F, and are based on excerpts of findings from CRPAQS. Several 
of the cited CRPAQS documents are available at CARB's ``Central 
California Air Quality Studies'' Web site (at http://www.arb.ca.gov/airways).
    For the 1997 annual and 24-hour PM2.5 NAAQS, the 2008 
PM2.5 Plan contains some qualitative descriptions of 
precursor ambient contributions. For example, the 2008 PM2.5 
Plan states on p. 2-8 that annual concentrations are driven by 
wintertime concentrations and further, that the highest short term 
concentrations are driven by ammonium nitrate, as found in the CRPAQS 
study:

    For most of the sites within the SJV, 50-75% of the annual average 
PM2.5 concentration could be attributed to a high 
PM2.5 period occurring from November to January. At non-
urban sites, the elevated PM2.5 was driven by secondary 
[ammonium nitrate].\16\
---------------------------------------------------------------------------

    \16\ Quote from ``Initial Data Analysis of Field Program 
Measurements,'' DRI Document No. 2497, July 29, 2005; Judith C. 
Chow, L.W. Antony Chen, Douglas H. Lowenthal, Prakash Doraiswamy, 
Kihong Park, Steven D. Kohl, Dana L. Trimble, John G. Watson, Desert 
Research Institute.

    There are also quantitative data in the Plan's Appendix G (p. G-21, 
Table 2) and, projected to 2014, in the Receptor Modeling Documentation 
(RMD). Ammonium nitrate for 2000 monitored data ranges from 24-36 
percent of total PM2.5, and if projected to 2014, ranges 
from 36-51 percent, confirming the importance of NOX, one 
source of the nitrate in ammonium nitrate, as a precursor that 
significantly contributes to annual PM2.5 levels in the SJV.
    In addition to composition data, ambient sensitivity to emissions 
changes can also be a consideration in determining which pollutants 
should be regulated in the attainment plan for a specific area. For 
ammonium nitrate PM2.5, which is formed from both ammonia 
and NOX, a key issue is whether the control of either or 
both precursors would be effective at reducing ambient PM2.5 
concentrations. Among the findings cited in the 2008 PM2.5 
Plan that address this issue are that:

    Particulate [ammonium nitrate] concentrations are limited by the 
rate of [nitric acid] formation, rather than by the availability of 
[ammonia].

and

    Comparisons of ammonia and nitric acid concentrations show that 
ammonia is far more abundant than nitric acid, which indicates that 
ammonium nitrate formation is limited by the availability of nitric 
acid, rather than ammonia * * *. This study's analyses suggest that 
reductions in NOX emissions will be more effective in 
reducing secondary ammonium nitrate aerosol concentrations than 
reductions in ammonia emissions. Reductions in VOC emissions will 
reduce secondary organic aerosol concentrations and may reduce 
ammonium nitrate. * * * The results indicate ammonium nitrate 
formation is ultimately controlled by NOX emission rates 
and the other species, including VOCs and background ozone, which 
control the rate of NOX oxidation in winter, rather than 
by ammonia emissions.\17\
---------------------------------------------------------------------------

    \17\ Quote from Lurmann, F. et. al., 2006, ``Processes 
Influencing Secondary Aerosol Formation in the San Joaquin Valley 
During Winter,'' Journal of the Air & Waste Management Association, 
(56): 1679-1693, cited at 2008 PM2.5 Plan p. 3-10.

    These findings are based on the relative abundance of ammonia 
relative to nitrate: There is so much ammonia present that 
significantly reducing its emissions would still leave ample ammonia to 
form ammonium nitrate. On the other hand, NOX is scarce 
(relative to ammonia), so reducing it could reduce ammonium nitrate 
significantly.
    Finally, sensitivity results from photochemical modeling were used 
in conjunction with the CMB results mentioned above. The 2014 RMD 
section on ``Review of control strategy effectiveness supported by CMAQ 
nitrate particulate evaluation'' shows the projected effect of a 50 
percent reduction of NOX emissions on PM2.5 
concentrations annually and in shorter seasonal episodes. For the 
annual concentration, the NOX reduction resulted in a 
predicted 5 [mu]g/m\3\ PM2.5 reduction, while for the winter 
episode the NOX reduction resulted in a predicted 28 [mu]g/
m\3\ PM2.5 reduction. 2014 RMD, p. 80. A 50 percent 
reduction in ammonia emissions, on the other hand, predicted 
PM2.5 reductions of only 0.1 [mu]g/m\3\ on an annual basis 
and 0.3 [mu]g/m\3\ during the winter episode. RMD, p. 81. When compared 
to the annual and 24-hour NAAQS of 15 and 65 [mu]g/m\3\, respectively, 
the effect of NOX reductions appears to be significant while 
the effect of ammonia reductions does not. Thus, the data and modeling 
results presented in the 2008 PM2.5 Plan, as well as the 
results of the cited studies, support the identification of 
NOX and the exclusion of ammonia as PM2.5 
attainment plan precursors, consistent with the EPA presumption in the 
PM2.5 implementation rule.
    EPA's presumption in the PM2.5 implementation rule is 
that VOC need not be an attainment plan precursor. 40 CFR 
51.1002(c)(3). As explained in the preamble to the rule, this 
presumption may not be technically justified for a particular 
nonattainment area, i.e., this presumption may be incorrect where 
emissions of VOC significantly contribute to PM2.5 
concentrations in the nonattainment area. 72 FR 20586 at 20590-93, 
20596-97. States or EPA may conduct a technical demonstration to 
reverse the presumptive exclusion of VOC as a PM2.5 
attainment plan precursor based on the weight of evidence of available 
technical and scientific information. Id.
    The 2008 PM2.5 Plan contains substantial information 
indicating that, for the SJV nonattainment area, VOC should be 
considered as a potential PM2.5 attainment plan precursor. 
On an annual basis, Table 2 in Appendix G (p. G-21,) gives an organic 
carbon range of 38-49 percent of the total PM2.5. This 
organic PM2.5 can be further divided into vegetative burning 
(9-19 percent of total annual PM2.5), direct VOC 
PM2.5 emissions (also 9-19 percent of total annual 
PM2.5), and secondary organic

[[Page 74532]]

aerosols (SOA) (2-5 percent of total annual PM2.5). RMD at 
19. This SOA contribution to overall PM2.5 levels appears to 
be non-negligible.
    The 2008 PM2.5 Plan states: ``Secondary organic aerosols 
(SOA) contribute to a significant fraction of PM2.5. SOA is 
organic carbon particulate formed in the photochemical oxidation of 
anthropogenic and biogenic VOC precursor gases. Aromatic compounds are 
believed to be efficient SOA producers contributing to this secondary 
particulate.'' 2008 PM2.5 Plan, p.3-8. On a 24-hour episodic 
basis, the contribution of SOA could be higher than the annual 2-5 
percent, though it is likely lower for the winter episodes of most 
concern in the SJV, due to decreased photochemical activity when fog 
and clouds (typical for the SJV in the winter) partially block 
sunlight. The chemistry of SOA is less well understood than the 
chemistry of other chemical species, so overall these considerations 
are not enough to overcome the negative presumption for VOC.
    But as noted in the preamble to the PM2.5 implementation 
rule at pp. 20592--20593, the lightest organic molecules can 
participate in atmospheric chemistry processes that result in the 
formation of ozone and certain free radical compounds (such as the 
hydroxyl radical [OH]) and these in turn participate in oxidation 
reactions to form secondary organic aerosols, sulfates, and nitrates. 
That is, VOC may be a PM2.5 precursor not just via formation 
of SOA, but also via its participation in the oxidant chemistry that 
leads to nitrate formation, a necessary step in the formation of 
ammonium nitrate PM2.5. NOX emissions must be 
oxidized to nitric acid before they form particulate ammonium nitrate. 
Two pathways for this to occur are 1) daytime oxidation by OH, which 
VOC radicals help create, and 2) nighttime oxidation by ozone.\18\
---------------------------------------------------------------------------

    \18\ Lurmann, F. et. al., 2006, op cit., p. 1688.
---------------------------------------------------------------------------

    The discussion in the 2008 PM2.5 Plan regarding ammonium 
nitrate (at p. 3-10, quoted above) also refers to VOC, which is 
identified as one of the controlling factors in NOX 
oxidation (which as noted above is a key process in the formation of 
nitrate and ammonium nitrate PM2.5): ``Reductions in VOC 
emissions will reduce secondary organic aerosol concentrations and may 
reduce ammonium nitrate.'' The Plan also states: ``Relatively low non-
methane organic compounds/nitrogen oxide ratios indicate the daytime 
photochemistry is VOC, sunlight, and background-ozone limited in 
winter.'' Id. If nitrate formation is VOC-limited under some 
circumstances, then VOC emission reductions could lead to ambient 
PM2.5 reductions.
    Finally, the RMD at page 82 contains sensitivity analyses for VOC, 
similar to the ones described above for NOX and ammonia. 
According to the sensitivity analysis, a 50 percent reduction in VOC 
emissions was predicted to reduce PM2.5 levels by 1.3 [mu]g/
m\3\ annually and 8.7 [mu]g/m\3\ for the winter episode. When compared 
to the 1997 annual PM2.5 NAAQS of 15 [mu]g/m\3\ and 24-hour 
NAAQS of 65 [mu]g/m\3\, these projected reductions appear significant. 
The 2014 RMD concludes: ``Finding: VOC reduction is effective for the 
annual standard and the winter episode for reduction of total carbon 
secondary particulates.''
    In response to comments submitted during the District's public 
comment period on the VOC issue, the Plan states that the ``modeling 
has shown that VOC reductions are not as effective in reducing 
secondary PM2.5 as NOX or SO2 
reductions'' and that ``[a]ll of the technical evaluations for CRPAQS 
and prior assessments of regional particulate models have indicated 
that NOX is the dominant factor and VOC and ammonia are 
not.'' 2008 PM2.5 Plan, pp.J-9 and p.J-19. These statements 
about VOC may be true, but they state only the relative effectiveness 
of controlling VOC compared to other precursors, do not cite any 
supporting modeling or technical evaluations, and do not address the 
substantial information in the 2008 PM2.5 Plan indicating 
that VOC may contribute significantly to ambient PM2.5 
levels in the SJV.
    As explained above, although EPA's presumption in the 
PM2.5 implementation rule is that VOC need not be a 
PM2.5 attainment plan precursor, this presumption may not be 
technically justified for certain nonattainment areas. Indeed, 
technical information in the 2008 PM2.5 Plan strongly 
suggests that VOC reductions can significantly reduce ambient 
PM2.5 concentrations and contribute to expeditious 
attainment of the PM2.5 NAAQS in the SJV.
    Other statements in the 2008 PM2.5 Plan clearly indicate 
the State did not intend to reverse the presumption for VOC. 
Nevertheless, the technical information we have identified is part of 
the administrative record related to development of the SIP provides 
evidence that the VOC presumption may not be technically justified in 
the SJV. It also indicates that the State should submit a demonstration 
to either support or reverse the presumption under the PM2.5 
implementation rule that VOC is not an attainment plan precursor. 40 
CFR 51.1002(c)(5).
    In the absence of a technical demonstration by the State, EPA 
reviewed the results of several modeling and monitoring studies of 
PM2.5 in the San Joaquin Valley. Some of these documents are 
available on the ``Central California Air Quality Studies'' Web site 
(at http://www.arb.ca.gov/airways) and/or are cited in the Plan and are 
reports from contractors involved in CRPAQS. Others are papers from 
peer-reviewed journals and are analyses using CRPAQS data or data from 
the earlier 1995 Integrated Monitoring Study (IMS95 study). We found 
that four monitoring studies and six modeling studies were relevant to 
the VOC precursor issue.\19\ Further information on these studies as 
well as excerpts from these studies are provided in the TSD.
---------------------------------------------------------------------------

    \19\ These studies are:
    Kleeman, M.K., Ying, Q., and Kaduwela, A., 2005, ``Control 
strategies for the reduction of airborne particulate nitrate in 
California's San Joaquin Valley'', Atmospheric Environment, 39: 
5325-5341 September 2005.
    Livingstone, P.L., et. al., 2009, ``Simulating PM Concentrations 
During a Winter Episode in a Subtropical Valley and Sensitivity 
Simulations and Evaluation methods'', Atmospheric Environment, 43: 
5971-5977.
    Lurmann, F.W., Brown, S.G., McCarthy, M.C., and Roberts P.T., 
2006, ``Processes Influencing Secondary Aerosol Formation in the San 
Joaquin Valley During Winter'', Journal of the Air & Waste 
Management Association, 56: 1679-1693.
    McCarthy, M., 2005, ``The Role of Nighttime Chemistry in Winter 
Ammonium Nitrate Formation in the San Joaquin Valley'', presented at 
the American Association for Aerosol Research (AAAR), Supersites 
Conference, February 2005, Atlanta, GA.
    Pun, B.K. and Seigneur, C., 1998, ``Conceptual Model of 
Particulate Matter Pollution in the California San Joaquin Valley'', 
prepared by Atmospheric and Environmental Research for Pacific Gas & 
Electric, Document Number CP045-1-98, 8 September 1998.
    Pun, B.K. and Seigneur, C., 2001, ``Sensitivity of Particulate 
Matter Nitrate Formation to Precursor Emissions in the California 
San Joaquin Valley'', Environmental Science and Technology, 35: 
2979-2987.
    Pun, B., 2004, ``CRPAQS Task 2.7 When and Where Does High O3 
Correspond to High PM2.5? How Much PM2.5 
Corresponds to Photochemical End Products?'', prepared by 
Atmospheric and Environmental Research, Inc. for the San Joaquin 
Valleywide Air Pollution Study Agency.
    Pun, B.K., Balmori R.T.F, and Seigneur, C., 2009, ``Modeling 
Wintertime Particulate Matter Formation in Central California'', 
Atmospheric Environment, 43: 402-409.
    Stockwell, W.R., Watson, J.G., Robinson, N.F., Steiner, W., and 
Sylte, W.W., 2000, ``The Ammonium Nitrate Particle Equivalent of 
NOX Emissions for Continental Wintertime Conditions'', 
Atmospheric Environment, 34: 4711-4717.
    Ying, Q., Lu, J., and Kleeman, M., 2009, ``Modeling air quality 
during the California Regional PM10/PM2.5 Air 
Quality Study (CPRAQS) using the UCD/CIT source-oriented air quality 
model--Part III. Regional source apportionment of secondary and 
total airborne particulate matter'', Atmospheric Environment, 43: 
419-430, January 2009.

---------------------------------------------------------------------------

[[Page 74533]]

    The monitoring studies all contain evidence that the VOC pathway 
for nitrate creation is important at least some of the time but differ 
as to how important it is relative to other pathways such as the 
nighttime ozone pathway, and are not conclusive on the efficacy of VOC 
controls. Unlike the monitoring studies, most of the modeling studies 
explicitly assessed the relative effectiveness of precursor controls, 
simulating the effect of 50 percent reductions in NOX, 
ammonia, and VOC. (One study does not explicitly address the issue, but 
states that background ozone is the most important oxidant, implying 
that VOC control would have little effect.) The two earliest modeling 
studies are based on photochemical box modeling and differ on whether 
VOC controls would significantly affect PM2.5. Three later 
studies use more sophisticated photochemical grid models and find VOC 
control to be effective, though generally less so than NOX 
control. One study predicts VOC control to be about two-thirds as 
effective as NOX control. The second study predicted VOC 
control to be effective, though only by a relatively small amount, at 
most 10 percent for a 50 percent reduction in VOC emissions, or only on 
certain days. The third grid modeling study predicts VOC control to 
give slightly more benefit than NOX control. While the 
models, input data, and results differ between these studies, they 
provide ample evidence that control of VOC can significantly reduce 
PM2.5 concentrations in the SJV. EPA is, therefore, 
proposing to find that these studies constitute a technical 
demonstration that VOC is a PM2.5 attainment plan precursor, 
necessitating the evaluation of controls for VOC for PM2.5 
attainment in the SJV.
    EPA proposes to concur with the evaluation in the 2008 
PM2.5 Plan that, at this time, ammonia does not need to be 
considered an attainment plan precursor for purposes of attaining the 
1997 PM2.5 NAAQS in the SJV.\20\ However, because the Plan 
and independent scientific studies contain substantial information 
indicating that VOC significantly contributes to PM2.5 
concentrations in the SJV, EPA is proposing to find that VOC is a 
PM2.5 attainment plan precursor for the SJV PM2.5 
nonattainment area under 40 CFR 51.1002(c)(3) and thus must be 
evaluated for emissions reductions measures.\21\
---------------------------------------------------------------------------

    \20\ EPA's proposed concurrence on excluding ammonia as an 
attainment plan precursor is limited to the attainment of the 1997 
PM2.5 NAAQS. EPA revised the 24-hour PM2.5 
standards in 2006 to lower them to 35 [micro]g/m\3\ and is currently 
reviewing both the annual and 24-hour standards to determine if they 
should be further revised to protect public health. See EPA, Policy 
Assessment for the Review of the Particulate Matter NAAQS, Second 
External Review Draft, June 2010. Evaluation of ammonia controls for 
the attainment of the 2006 standards and any future revised 
standards may show that such controls would significantly contribute 
to lower PM2.5 levels in the Valley.
    \21\ In its approval of the SJV 2003 PM10 plan, EPA 
determined that for the purposes of section 189(b)(1)(B) and (e) and 
in the absence of final data from CRPAQS, VOC does not contribute 
significantly to PM10 levels which exceed the standards 
in the SJV. See 69 FR 30006, 30011 (May 26, 2004). In that 
determination, EPA relied on the criteria that VOC control was not 
shown to be absolutely necessary for PM10 attainment and 
that it had a lower effectiveness than NOX control in 
reduction PM10. In addition, EPA noted in its 2004 final 
rule the District's intention to re-examine the VOC issue when 
CRPAQS results were available. 69 FR 30010.
    Since its 2004 finding, EPA promulgated the PM2.5 
implementation rule, which has an explicit criterion for determining 
which PM2.5 precursors must be evaluated for controls, 
namely, that a significant change in emissions of the precursor 
would be projected to provide a significant change in 
PM2.5 concentrations in the nonattainment area. See 72 FR 
20586 at 20590 and 40 CFR 51.1000. This is a different criterion 
than the one relied on in the 2004 determination. Data and analyses 
from CRPAQS have also become available. These developments since 
2004 support a finding different from our 2004 one.
    We also note that the 2004 finding was made for the 
PM10 standards rather than the PM2.5 
standards. The levels of the 24-hour and annual PM2.5 
NAAQS (65 [micro]g/m\3\ and 15 [micro]g/m\3\) are much lower than 
those for the 24-hour and (revoked) annual PM10 standards 
(150 [micro]g/m\3\ and 50 [micro]g/m\3\). A given concentration 
change is therefore likely to be more significant for the 
PM2.5 standards than for the PM10 standards.
---------------------------------------------------------------------------

4. Extension of the Attainment Date
    CAA section 172(a)(2) provides that an area's attainment date 
``shall be the date by which attainment can be achieved as 
expeditiously as practicable, but no later than 5 years from the date 
such area was designated nonattainment * * *, except that the 
Administrator may extend the attainment date to the extent the 
Administrator determines appropriate, for a period no greater than 10 
years from the date of designation as nonattainment considering the 
severity of nonattainment and the availability and feasibility of 
pollution control measures.''
    Because the effective date of designations for the 1997 
PM2.5 standards is April 5, 2005 (70 FR 944), the initial 
attainment date for PM2.5 nonattainment areas is as 
expeditiously as practicable but not later than April 5, 2010. For any 
areas that are granted a full five-year attainment date extension under 
section 172, the attainment date would be not later than April 5, 2015.
    Section 51.1004 of the PM2.5 implementation rule 
addresses the attainment date requirement. Section 51.1004(b) requires 
a state to submit an attainment demonstration justifying its proposed 
attainment date and provides that EPA will approve an attainment date 
when we approve that demonstration. Thus, our approval of an extended 
attainment date is dependent upon a demonstration showing expeditious 
attainment and likewise, dependent upon proper evaluation of what 
constitutes RACM/RACT level controls in the area.
    States that request an extension of the attainment date under CAA 
section 172(a)(2) must provide sufficient information to show that 
attainment by April 5, 2010 is impracticable due to the severity of the 
nonattainment problem in the area and the lack of available and 
feasible control measures to provide for faster attainment. 40 CFR 
51.1004(b). States must also demonstrate that all RACM and RACT for the 
area are being implemented to bring about attainment of the standard by 
the most expeditious alternative date practicable for the area. 72 FR 
20586 at 20601. Thus, the proper evaluation of RACM/RACT controls is an 
integral part of justifying an extension of the attainment date.
    The 2008 PM2.5 Plan includes a demonstration that the 
attainment date for the SJV should be April 5, 2015, i.e., that the 
area qualifies for the full five-year extension of the attainment date 
allowable under section 172(a)(1). This demonstration is found in 
Chapter 9 of the 2008 PM2.5 Plan and is derived from the air 
quality modeling in the Plan.
    SJV's degree of PM2.5 nonattainment can fairly be 
characterized as severe. The area typically records the highest ambient 
PM2.5 levels in the nation, with 2007-2009 design values for 
the annual and 24-hour PM2.5 levels in urban Bakersfield 
area of 22.6 [micro]g/m\3\ and 70 [micro]g/m\3\, respectively. See EPA, 
Air Quality System, Design Value Report, August 9, 2010. The 
PM2.5 problem in the San Joaquin Valley is complex, caused 
by both direct and secondary PM2.5 and compounded by the 
area's topographical and meteorological conditions that are 
particularly conducive to the formation and concentration of 
PM2.5 particles. See 2008 PM2.5 plan, Chapter 3.
    As discussed in section IV.C.2.a. above, the District's strategy 
for attaining the PM2.5 standard relies on reductions of 
direct PM2.5 as well as the PM2.5 precursor 
pollutants NOX and SO2. The SJV needs significant 
reductions in PM2.5 and NOX to demonstrate 
attainment. EPA believes that further reduction of these pollutants is 
challenging because the State and local air pollution regulations 
already in place include most of the

[[Page 74534]]

readily available PM2.5 and NOX, control 
measures. Moreover, attainment in the SJV depends upon emissions 
reductions that offset the emissions increases associated with the 
projected increases in population and emissions levels for this high-
growth area.
    Reductions of direct PM2.5 are achieved primarily from 
open burning, commercial charbroiling, and residential wood combustion 
control measures. These types of control measures present special 
implementation challenges (e.g., the large number of individuals 
subject to regulation and the difficulty of applying conventional 
technological control solutions). NOX reductions come 
largely from District rules for fuel combustion sources and from the 
State's mobile source rules.
    Because of the necessity of obtaining additional emissions 
reductions from these source categories in the SJV and the need to 
conduct significant public outreach if applicable control approaches 
are to be effective, EPA agrees with the District and CARB that the 
2008 PM2.5 Plan reflects expeditious implementation of the 
available control programs during the 2008-2014 time frame. EPA also 
agrees that the implementation schedule for enhanced stationary source 
controls is expeditious, taking into account the time necessary for 
purchase and installation of the required control technologies. 
Finally, we believe that it is not feasible at this time to accelerate 
the emission reduction schedule for the State and Federal mobile source 
requirements which must rely on fleet turnover over the years to 
ultimately deliver the anticipated emission reductions. The District's 
control strategies are discussed in greater detail in Chapter 6 of the 
2008 PM2.5 Plan, and in section IV.C.2.a. above.
    In addition, the State has adopted standards for many categories of 
on-road and off-road vehicles and engines, and gasoline and diesel 
fuels, and included commitments to develop rules for Smog Check 
Improvements, Cleaner In-Use Heavy-Duty Trucks, and Cleaner In-Use Off-
Road Equipment.
    EPA believes that the District and State are implementing these 
rules and programs as expeditiously as practicable. We anticipate, 
however, that the District and CARB will reevaluate this conclusion 
after completion of the mid-course review of the PM2.5 
attainment SIP for this area, due in April 2011. EPA also expects that 
the District and CARB will continue to investigate opportunities to 
accelerate progress toward attainment as new control opportunities 
arise, and that the agencies will promptly adopt and expeditiously 
implement any new measures found to be feasible in the future.
    As discussed in section IV.D.2. above, we are proposing to 
disapprove the air quality modeling in the 2008 PM2.5 plan 
because it is insufficiently documented for us to evaluate its 
adequacy. Without adequate air quality modeling, it is not possible to 
determine the reductions needed to attain the PM2.5 NAAQS in 
the SJV and, in turn, to evaluate, as required by CAA section 
172(a)(2), the availability and feasibility of controls needed to 
attain.
    As discussed in section IV.C.3. above, we are also proposing to 
disapprove the RACM/RACT demonstration in the SJV 2008 PM2.5 
Plan in part because it does not consider RACM/RACT for VOC sources. As 
stated in the PM2.5 implementation rule (72 FR 20586 at 
20601), EPA cannot grant an extension of the attainment date beyond the 
initial five years provided by section 172(a)(2)(A) if the state has 
not adequately considered and evaluated the implementation of RACM and 
RACT in the area. By definition, RACM/RACT are those controls that are 
necessary to demonstrate attainment as expeditiously as practicable and 
to meet any RFP requirements. 40 CFR 51.1010(a). Without an adequate 
evaluation of potential RACM/RACT controls for VOC sources, EPA is 
unable to determine whether the State's requested attainment date is as 
expeditious as practicable in accordance with CAA 172(a)(2).
    For these reasons, EPA is proposing to not grant California's 
request for an attainment date extension to April 5, 2015 for the San 
Joaquin Valley. Given the severity of the PM2.5 
nonattainment problem in the SJV, an extension of the attainment date 
would most likely be appropriate and approvable if it were supported by 
the necessary analysis and part of an attainment plan that meets the 
applicable statutory and regulatory requirements including RACM/RACT 
and an expeditious attainment demonstration.
5. Attainment Demonstration
    Table 7 below summarizes the reductions that are relied upon in the 
2008 PM2.5 Plan to demonstrate attainment by April 5, 2015. 
The attainment target numbers in this table should be considered 
preliminary because they are derived from the Plan's air quality 
modeling analysis, which we are proposing to disapprove.

                 Table 7--Summary of Reductions Needed for SJV's PM2.5 Attainment Demonstration
                                          (tons per average annual day)
----------------------------------------------------------------------------------------------------------------
                                                                       PM2.5            NOX             SO2
----------------------------------------------------------------------------------------------------------------
A. 2005 emissions level.........................................            86.0           575.4            26.4
B. 2014 attainment target.......................................            63.3           291.2            24.6
C. Total reductions needed by 2014 (A-B)........................            22.7           284.2             1.8
D. Reductions from baseline (pre-2007) measures.................            11.0           199.2             0.9
    Percent of total reductions from baseline measures..........           49.5%           70.8%             50%
E. Reductions needed from new measures (C-D)....................            11.7            85.0             0.9
    Percent of total reductions needed from new measures........           50.5%           29.2%             50%
New District reductions.........................................             6.7             9.0             0.9
    Percent of total reductions needed from new District                   28.5%            3.2%             50%
     measures...................................................
New State reductions............................................             5.0            76.0             0.0
    Percent of total reductions needed from new State measures..           22.0%           26.7%              0%
----------------------------------------------------------------------------------------------------------------
Source: 2008 PM2.5 Plan, pp. 8-2 and 9-3.

    As shown in this table, the majority of reductions that the State 
projects are needed for PM2.5 attainment in the SJV by 2015 
come from baseline reductions, i.e., from adopted measures that have 
generally been approved by EPA either through the SIP or the CAA 
section 209 waiver process. See Appendices A and B of the TSD. The 
remaining reductions needed for attainment are to be achieved through 
the District's and CARB's commitments to reduce emissions in the

[[Page 74535]]

SJV. Since the submittal of the 2008 PM2.5 Plan and 2007 
State Strategy, SJVAPCD has already adopted measures (summarized in 
Table 8 below) that can be credited toward reducing its aggregate 
emissions reduction in its enforceable commitments.

Table 8--Summary of Enforceable Commitments in the 2008 PM[ihel2].[ihel5] Plan and SJV Portion of the 2007 State
                                                    Strategy
                                          (Tons per average annual day)
----------------------------------------------------------------------------------------------------------------
                                                                     PM[ihel2].[ihel5]      NOX          SOX
----------------------------------------------------------------------------------------------------------------
Total reductions needed for attainment.............................            22.7           284.2          1.8
Total State and District commitment................................            11.7            85.0          0.9
Less reductions from currently creditable measures.................             2.3             5.2          0.1
Total remaining commitments........................................             9.4            79.8          0.8
Total remaining commitments as a percent of reductions needed for               41%             28%          44%
 attainment........................................................
----------------------------------------------------------------------------------------------------------------

a. Enforceable Commitments
    As shown above, measures already adopted by the District and CARB 
(both prior to and as part of the 2008 PM2.5 Plan) provide 
the majority of emissions reductions the State projects are needed to 
demonstrate attainment. The balance of the needed reductions is in the 
form of enforceable commitments by the District and CARB. This approach 
is consistent with past practice because the CAA allows approval of 
enforceable commitments that are limited in scope where circumstances 
exist that warrant the use of such commitments in place of adopted 
measures.\22\ Once EPA determines that circumstances warrant 
consideration of an enforceable commitment, EPA considers three factors 
in determining whether to approve the CAA requirement that relies on 
the enforceable commitment: (a) Does the commitment address a limited 
portion of the CAA-requirement; (b) is the state capable of fulfilling 
its commitment; and (c) is the commitment for a reasonable and 
appropriate period of time.\23\
---------------------------------------------------------------------------

    \22\ Commitments approved by EPA under CAA section 110(k)(3) are 
enforceable by EPA and citizens under CAA sections 113 and 304, 
respectively. In the past, EPA has approved enforceable commitments 
and courts have enforced these actions against states that failed to 
comply with those commitments. See, e.g., American Lung Ass'n of 
N.J. v. Kean, 670 F. Supp. 1285 (D.N.J. 1987), aff'd, 871 F.2d 319 
(3rd Cir. 1989); NRDC, Inc. v. N.Y. State Dept. of Env. Cons., 668 
F. Supp. 848 (S.D.N.Y. 1987); Citizens for a Better Env't v. 
Deukmejian, 731 F. Supp. 1448, recon. granted in par, 746 F. Supp. 
976 (N.D. Cal. 1990); Coalition for Clean Air v. South Coast Air 
Quality Mgt. Dist., No. CV 97-6916-HLH, (C.D. Cal. Aug. 27, 1999). 
Further, if a state fails to meet its commitments, EPA could make a 
finding of failure to implement the SIP under CAA section 179(a), 
which starts an 18-month period for the State to correct the non-
implementation before mandatory sanctions are imposed.
    CAA section 110(a)(2)(A) provides that each SIP ``shall include 
enforceable emission limitations and other control measures, means 
or techniques * * * as well as schedules and timetables for 
compliance, as may be necessary or appropriate to meet the 
applicable requirement of the Act.'' Section 172(c)(6) of the Act, 
which applies to nonattainment SIPs, is virtually identical to 
section 110(a)(2)(A). The language in these sections of the CAA is 
quite broad, allowing a SIP to contain any ``means or techniques'' 
that EPA determines are ``necessary or appropriate'' to meet CAA 
requirements, such that the area will attain as expeditiously as 
practicable, but no later than the designated date. Furthermore, the 
express allowance for ``schedules and timetables'' demonstrates that 
Congress understood that all required controls might not have to be 
in place before a SIP could be fully approved.
    \23\ The U.S. Court of Appeals for the Fifth Circuit upheld 
EPA's interpretation of CAA sections 110(a)(2)(A) and 172(c)(6) and 
the Agency's use and application of the three factor test in 
approving enforceable commitments in the 1-hour ozone SIP for 
Houston-Galveston. BCCA Appeal Group et al. v. EPA et al., 355 F.3d 
817 (5th Cir. 2003).
---------------------------------------------------------------------------

    We believe that, with respect to the 2008 PM2.5 Plan and 
revised 2007 State Strategy, circumstances warrant the consideration of 
enforceable commitments as part of the attainment demonstration for 
this area. As shown in Table 9 above, the majority of emissions 
reductions that the State currently estimates are needed to demonstrate 
attainment and RFP in the SJV come from rules and regulations that were 
adopted prior to 2007, i.e., they come from the baseline measures.
    As a result of these already adopted District and State measures, 
most sources in the San Joaquin Valley nonattainment area were already 
subject to stringent rules prior to the development of the 2007 State 
Strategy and the 2008 PM2.5 Plan, leaving fewer and more 
technologically challenging opportunities to reduce emissions. In the 
2008 PM2.5 Plan and the 2007 State Strategy, the District 
and CARB identified potential control measures that could achieve the 
additional emissions reductions needed for attainment. However, the 
timeline needed to develop, adopt, and implement these measures went 
well beyond the April 5, 2008 \24\ deadline to submit the 
PM2.5 attainment plan. As discussed above and below, since 
2007, the District and State have made progress in adopting measures to 
meet their commitments, but have not completely fulfilled them. Given 
these circumstances, the 2008 PM2.5 Plan's and 2007 State 
Strategy's reliance on enforceable commitments is warranted. We now 
consider the three factors EPA uses to determine whether the use of 
enforceable commitments in lieu of adopted measures to meet a CAA 
planning requirement is approvable.
---------------------------------------------------------------------------

    \24\ The 2007 State Strategy was developed to address both the 
1997 PM2.5 NAAQS and the 1997 8-hour Ozone NAAQS. The 8-
hour ozone SIPs were due in November 2007, and the development and 
adoption of the State Strategy was timed to coordinate with this 
submittal date. 2007 State Strategy, p. 1.
---------------------------------------------------------------------------

i. The Commitment Must Represent a Limited Portion of Required 
Reductions
    For the first factor, we look to see if the commitment addresses a 
limited portion of a statutory requirement, such as the amount of 
emissions reductions needed for attainment in a nonattainment area. As 
shown in Table 8 above, the remaining portion of the enforceable 
commitments in the 2008 PM2.5 Plan and the 2007 State 
Strategy are 9.4 tpd direct PM2.5, 79.8 tpd NOX 
and 0.8 tpd SO2. When compared to the State's current 
estimate of the reductions needed by 2014 for PM2.5 
attainment in the SJV, the remaining portion of the enforceable 
commitments represents approximately 41 percent of the needed 
PM2.5 reductions, 28 percent of the needed NOX 
reductions, and 44 percent of the needed SO2 reductions. 
Historically, EPA has approved SIPs with enforceable commitments in the 
range of 10 percent or less of the total needed reductions for 
attainment. See, for examples, our approval of the SJV PM10 
Plan at 69 FR 30005 (May 26, 2004), approval of the SJV 1-hour ozone 
plan at 75 FR 10420 (March 8, 2010), and approval of the Houston-
Galveston plan at 66 FR 57160, 57161 (November 14, 2001).
    We note that there are significant emissions reductions tied to the 
Cleaner

[[Page 74536]]

In-Use Heavy-Duty Trucks measure and Cleaner In-Use Off-Road Engines 
listed in the 2009 State Strategy Status Report, page 6. EPA 
understands that the State is currently revising these rules for re-
adoption in late 2010 and subsequent submittal for EPA approval. It is 
possible that the reductions from these measures and several 
outstanding District rules will reduce the percentage of the remaining 
portion of the enforceable commitments to below 10 percent of the total 
emissions reductions needed for attainment. However, until these (or 
other) measures are adopted, submitted, and EPA approved, we believe 
that the percentages of enforceable commitments for direct 
PM2.5, NOX, and SO2 relied upon in the 
2008 PM2.5 Plan and 2007 State Strategy are too high and do 
not represent a limited portion of the State's current estimate of 
total emissions reductions needed to meet the statutory requirement for 
attainment in the SJV.
ii. The State Must Be Capable of Fulfilling its Commitment
    For the second factor, we consider whether the District and State 
are capable of fulfilling their commitments. As discussed above, 
following the adoption and submittal of the 2007 State Strategy, CARB 
adopted and submitted the 2009 State Strategy Status Report which shows 
the State's progress in achieving its enforceable commitments for the 
SJV. The 2009 State Strategy Status Report shows that during 2007 and 
2008, the State has adopted rules for ten measures identified in the 
2007 State Strategy and three rules that were not identified in the 
Strategy that will contribute to the needed PM2.5 and 
NOX reductions. The 2009 State Strategy Status Report 
includes a table with estimates of the reductions that may fulfill the 
CARB's full commitment. See 2009 State Strategy Status Report, p. 18.
    EPA believes that the District has also made good progress in 
meeting its enforceable commitments as shown in Table 2 above. We also 
believe that the District's continued efforts in committing to and 
adopting measures for sources under its jurisdiction will help it meet 
its commitments. In addition, beyond the rules discussed above, both 
CARB and the District have well-funded incentive grants programs to 
reduce emissions from the on- and off-road engine fleets.
    While progress has been made by the District and State to achieve 
their enforceable commitments, there are still significant reductions 
that must be addressed in order to satisfy the commitments. As 
discussed above, the remaining portion of the enforceable commitments 
is 28 to 44 percent for the relevant pollutants. Given the evidence of 
the State's and District's efforts to date and their continuing efforts 
to reduce emissions, we believe that the State and District are capable 
of meeting their enforceable commitments to achieve total reductions of 
11.7 tpd direct PM2.5, 85 tpd NOX, and 0.9 tpd 
SO2 in the San Joaquin Valley by 2014.
iii. The Commitment Must Be for a Reasonable and Appropriate Timeframe
    Finally, for the third factor, we consider whether the commitments 
are for a reasonable and appropriate period of time. In order to meet 
the commitments by 2014, the 2008 PM2.5 Plan and 2007 State 
Strategy include an ambitious rule development, adoption, and 
implementation schedules. EPA considers these schedules to provide 
sufficient time to achieve the committed reductions by 2014. As we have 
noted previously, many of the scheduled measures have been adopted. See 
Tables 2 and 5 above and the 2009 State Strategy Status Report, pp. 4, 
17 and 23. The State and District are continuing to evaluate their 
adopted measures and the need for additional emissions reductions from 
new measures in this area. While we believe the State and District have 
provided reasonable and appropriate schedules for achieving their 
commitments by 2014, as discussed above, EPA is not proposing to grant 
the attainment date extension for the San Joaquin Valley. Thus, we 
cannot currently conclude that the third factor is satisfied.
6. Proposed Action on the Attainment Demonstration
    In order to approve a SIP's attainment demonstration, EPA must make 
several findings and approve the plan's proposed attainment date.
    First, we must find that the demonstration's technical bases, 
including the emissions inventories and air quality modeling, are 
adequate. As discussed above in sections IV.B. and IV.D.2, we are 
proposing to approve the emissions inventories but to disapprove the 
air quality modeling on which the SJV 2008 PM2.5 Plan's 
attainment demonstration and other provisions are based.
    Second, we must find that the SIP submittal provides for 
expeditious attainment through the implementation of all RACM and RACT. 
As discussed above in section IV.C., we are proposing to disapprove the 
RACM/RACT demonstration in the SJV PM2.5 SIP.
    Third, EPA must find that the emissions reductions that are relied 
on for attainment are creditable. While EPA has previously accepted 
enforceable commitments in lieu of adopted control measures in 
attainment demonstrations, EPA has done so only when the circumstances 
warranted it and the commitments met three criteria. We believe that 
circumstances here warrant the consideration of enforceable 
commitments. We also believe that both the State and the District have 
demonstrated the capability to meet their commitments. However, the 
commitments do not constitute a limited portion of the required 
emissions reductions needed for attainment and are not for an 
appropriate timeframe. The State's and District's unfulfilled 
commitments currently represent 41 percent of the PM2.5 
reductions, 28 percent of the NOX reductions, and 44 percent 
of the SO2 emissions reductions (30 percent of the combined 
emissions reductions of all pollutants) currently estimated to be 
required for attainment of the 1997 PM2.5 NAAQS in the SJV. 
These percentages are well above the 10 percent figure generally 
accepted by EPA to approve an attainment demonstration that relies in 
part on enforceable commitments.
    Finally, for a PM2.5 nonattainment area that cannot 
attain within five years of its designation as nonattainment, EPA must 
grant an extension of the attainment date in order to approve the 
attainment demonstration for the area. As discussed above in section 
IV.D.4., while we believe that an extension of the attainment date 
would be appropriate if supported by the necessary analysis, we are not 
at this time proposing to grant the State's request to extend the 
attainment date in the SJV to April 5, 2015.
    For the foregoing reasons, we are proposing to disapprove the 
attainment demonstration in the SJV 2008 PM2.5 Plan.

E. Reasonable Further Progress Demonstration

1. Requirements for RFP
    CAA section 172(c)(2) requires that plans for nonattainment areas 
shall provide for reasonable further progress (RFP). RFP is defined in 
section 171(1) as ``such annual incremental reductions in emissions of 
the relevant air pollutant as are required by this part or may 
reasonably be required by the Administrator for the purpose of ensuring 
attainment of the applicable [NAAQS] by the applicable date.''
    The PM2.5 implementation rule requires submittal of an 
RFP plan at the same time as the attainment demonstration for any area 
for which a

[[Page 74537]]

state requests an extension of the attainment date beyond 2010. For 
areas for which the state requests an attainment date extension to 
2015, such as SJV, the RFP plan must demonstrate that in the applicable 
milestone years of 2009 and 2012, emissions in the area will be at a 
level consistent with generally linear progress in reducing emissions 
between the base year and the attainment year. 40 CFR 51.1009(d). 
States may demonstrate this by showing that emissions for each 
milestone year are roughly equivalent to benchmark emissions levels for 
direct PM2.5 and each PM2.5 attainment plan 
precursor addressed in the plan. The steps for determining the 
benchmark emissions levels to demonstrate generally linear progress are 
provided in 40 CFR 51.1009(f).
    The RFP plan must describe the control measures that provide for 
meeting the reasonable further progress milestones for the area, the 
timing of implementation of those measures, and the expected reductions 
in emissions of directly-emitted PM2.5 and PM2.5 
attainment plan precursors. See 40 CFR 51.1009(c).
2. The RFP Demonstration in the SJV 2008 PM2.5 Plan
    The RFP demonstration is in Chapter 8 of the 2008 PM2.5 
Plan. The demonstration addresses direct PM2.5, 
NOX, and SO2, uses the 2005 annual average day 
inventory as the base year inventory, and assumes 2014 as the 
attainment year. The measures that the 2008 PM2.5 Plan 
depends on for RFP and the emissions reductions from each measure in 
each year are given in Table 6-3 of the 2008 PM2.5 Plan.
    The 2008 PM2.5 Plan presents the RFP demonstration in 
terms of cumulative emissions reductions and percent of emissions 
reductions per year. See Table 8-4 in the 2008 PM2.5 Plan. 
This demonstration reserves 1 percent of the direct PM2.5 
baseline (0.8 tpd) and 3 percent of the NOX baseline (12-15 
tpd NOX) as contingency measures by decreasing the 
cumulative emissions reductions in each milestone year by these 
amounts. 2008 PM2.5 Plan, p. 8-3. The Plan does not include 
a contingency reserve for SO2. We discuss this contingency 
reserve below in the section on contingency measures. However, for the 
purposes of our evaluation of the RFP demonstration as presented in 
Table 9 below, we have not included it. This allows us to evaluate if 
the 2008 PM2.5 Plan would demonstrate the required RFP 
without the contingency reserve. We note that the RFP demonstration 
presented in Table 9 is based on the State's current estimate of the 
emissions levels needed for attainment in the SJV.

               Table 9--Benchmark RFP Demonstration using Plan Data No Contingency Measure Reserve
                                          (Tons per annual average day)
----------------------------------------------------------------------------------------------------------------
                                                                       PM2.5            NOX             SO2
----------------------------------------------------------------------------------------------------------------
                                                      2009
----------------------------------------------------------------------------------------------------------------
Benchmark emissions level.......................................            75.9           449.1            25.2
Projected emissions level.......................................            78.2           498.5            22.9
Emissions above benchmark emissions level.......................             2.3            49.4            -2.2
Percent above benchmark emissions level.........................             3.0            11.0            -8.9
----------------------------------------------------------------------------------------------------------------
                                                      2012
----------------------------------------------------------------------------------------------------------------
Benchmark emissions level.......................................            68.3           354.4            24.2
Projected emissions level.......................................            70.3           415.8            22.9
Emissions above benchmark emissions level.......................             2.0            61.5            -1.3
Percent above benchmark emissions level.........................             2.9            17.3            -5.4
----------------------------------------------------------------------------------------------------------------

3. Proposed Action on the RFP Demonstration
    As discussed above, EPA is proposing to disapprove the air quality 
modeling in the 2008 PM2.5 Plan because there is 
insufficient documentation for us to determine its adequacy. Because of 
this, we are also proposing to disapprove the RFP demonstration in the 
2008 PM2.5 Plan. Air quality modeling establishes the 
emissions levels needed for attainment in an area. Thus, uncertainties 
about the adequacy of the air quality modeling result in uncertainties 
about the emissions levels needed for attainment. These uncertainties 
also affect the RFP demonstrations because in order to determine what 
constitutes ``generally linear progress'' towards attainment in an 
area, we must first know the target level of emissions that the area 
needs to attain.
    Assuming that the State's current estimates of the emissions levels 
needed for attainment are correct and that EPA will ultimately be able 
to grant an extension of the SJV's attainment date to April 5, 2015, 
Table 9 shows that the SJV area is projected to be only slightly above 
its benchmark emissions levels for direct PM2.5 in both 2009 
and 2012 and well below the benchmark emissions levels for 
SO2 in both years. However, for NOX, the gap 
between the projected emissions and benchmark levels is over 10 percent 
in 2009 and grows to more than 17 percent in 2012.
    The shortfall in RFP for NOX is especially problematic 
given the nature of the PM2.5 nonattainment problem in the 
SJV. Ammonium nitrate contributes 40 percent of the Valley's annual 
PM2.5 levels. 2008 PM2.5 Plan, p. H-12. Available 
information indicates that NOX is one of the limiting 
compounds in the reaction that forms ammonium nitrate, making 
NOX control an effective approach to reducing ambient 
PM2.5 levels in the SJV. 2008 PM2.5 Plan, p. 9-1. 
Hence, the shortfalls in NOX emissions reductions in the RFP 
demonstration are likely to adversely affect progress in reducing 
ambient PM2.5 levels in the SJV, an effect that will likely 
not be compensated for by excess reductions of SO2.
    As discussed above, we are proposing to find that VOC is a 
PM2.5 attainment plan precursor for which the state must 
evaluate RFP, among other things. The 2008 PM2.5 Plan does 
not currently include an RFP demonstration for VOC.
    Based on our proposed disapproval of the air quality modeling 
analysis and attainment demonstration, we are proposing to disapprove 
the RFP demonstration in the 2008 PM2.5 Plan for failure to 
meet the requirements of CAA section 172(c)(2) and 40 CFR 51.1009. We 
also note the lack of generally linear progress in NOX 
emissions reductions, especially in

[[Page 74538]]

2012, and the lack of an RFP demonstration for VOC. The District and 
State should address both these issues in any revision to the SJV 
PM2.5 Plan's RFP demonstration.

F. Contingency Measures

1. Requirements for Contingency Measures
    Under CAA section 172(c)(9), all PM2.5 attainment plans 
must include contingency measures to be implemented if an area fails to 
meet RFP (RFP contingency measures) and contingency measures to be 
implemented if an area fails to attain the PM2.5 NAAQS by 
the applicable attainment date (attainment contingency measures). These 
contingency measures must be fully adopted rules or control measures 
that are ready to be implemented quickly without significant additional 
action by the state. 40 CFR 51.1012. They must also be measures not 
relied on in the plan to demonstrate RFP or attainment and should 
provide SIP-creditable emissions reductions equivalent to approximately 
one year of the emissions reductions needed for RFP. 72 FR 20586 at 
20642-43. Finally, the SIP should contain trigger mechanisms for the 
contingency measures and specify a schedule for their implementation. 
Id.
    Contingency measures can include Federal, State and local measures 
already scheduled for implementation that provide emissions reductions 
in excess of those reductions needed to provide for RFP or expeditious 
attainment. EPA has approved numerous SIPs under this interpretation. 
See, for example, 62 FR 15844 (April 3, 1997) direct final rule 
approving Indiana ozone SIP revision; 62 FR 66279 (December 18, 1997), 
final rule approving Illinois ozone SIP revision; 66 FR 30811 (June 8, 
2001), direct final rule approving Rhode Island ozone SIP revision; 66 
FR 586 (January 3, 2001), final rule approving District of Columbia, 
Maryland, and Virginia ozone SIP revisions; and 66 FR 634 (January 3, 
2001), final rule approving Connecticut ozone SIP revision.
2. Contingency Measures in the SJV 2008 PM2.5 Plan
    Contingency measures are described in Section 9.2. of the 2008 
PM2.5 Plan (pp. 9-5 to 9-9) and are composed of a new 
commitment by the SJVAPCD to request that CARB accelerate adoption and 
implementation of its measures and surplus reductions from State and 
District measures. In late 2008, the SJVAPCD adopted a further 
contingency measure as part of its wood burning rule, Rule 4901. CARB 
identified two additional contingency measures for the SJV 2008 
PM2.5 Plan during its public hearing on the Plan. We discuss 
each of these contingency measures below.
    The Plan does not calculate the emissions reductions that are 
equivalent to one year's worth of RFP. We have, however, calculated one 
year's worth of RFP to be 2.5 tpd PM2.5, 31.6 tpd 
NOX, and 0.3 tpd SO2 using information in the 
Plan. See section II.I. of the TSD. This calculation is based on the 
State's current estimate of the emissions reductions needed for 
attainment by 2015.
    Request CARB To Accelerate State Measure Implementation--This 
proposed contingency measure (which could function as both a RFP and 
attainment contingency measure), requires the District's Governing 
Board to adopt a resolution requesting CARB to accelerate the adoption 
and/or implementation of any remaining CARB control measures that have 
not yet been adopted or fully implemented. 2008 PM2.5 Plan, 
p. 9-7. Under CAA section 172(c)(9) and EPA's long-standing policies 
\25\ interpreting this section, contingency measures must require 
minimal additional rulemaking by the State and take effect within a few 
months of a failure to make RFP or to attain. This proposed contingency 
measure would require additional rulemaking at the District level and 
potentially substantial and lengthy additional rulemaking at the State 
level to be implemented. For these reasons, this proposed measure does 
not meet CAA requirements for contingency measures.
---------------------------------------------------------------------------

    \25\ See ``State Implementation Plans; General Preamble for the 
Implementation of Title I of the Clean Air Act Amendments of 1990,'' 
57 FR 13498 at 13510 (April 16, 1992).
---------------------------------------------------------------------------

    Surplus Emissions Reductions from the Ozone Nonattainment Area 
Fee--This proposed contingency measure (which could function as an RFP 
contingency measure for the 2012 milestone and as an attainment 
contingency measure) would use fees generated from the District Rule 
3170, Ozone Nonattainment Area Fee, to achieve emissions reductions. 
The implementation of Rule 3170 is triggered solely by a failure of the 
SJV to attain the 1-hour ozone standard by its applicable attainment 
date (which can occur no earlier than November 15, 2010, see CAA 
section 181(a)(1)) and not by any failures to meet PM2.5 RFP 
targets or to attain the 1997 PM2.5 NAAQS, a minimum 
requirement for contingency measures for PM2.5 SIPs. For 
this reason, this proposed measure does not meet CAA requirements for 
contingency measures.\26\
---------------------------------------------------------------------------

    \26\ Should the rule's requirements be triggered and the 
collected fees used in an incentive program to reduce emissions of 
direct PM2.5, NOX, VOC, and/or SO2, 
then the District may rely on those reductions to fulfill the 
contingency measure requirement for the PM2.5 plan to the 
extent that the reductions meet SIP creditability requirements and 
are not otherwise needed for expeditious attainment or RFP for the 
PM2.5 NAAQS.
---------------------------------------------------------------------------

    Surplus Emissions Reductions from Incentive Funds--As noted 
previously, the District has several incentive grant programs that have 
the potential to generate considerable emissions reductions. The 2008 
PM2.5 Plan suggests the use of these reductions as 
contingency measures for failure either to meet RFP or to attain. While 
neither the CAA nor EPA policy bar the use of emissions reductions from 
incentive programs to meet all or part of an area's contingency measure 
obligation, the incentive programs must assure that the reductions are 
surplus, quantifiable, enforceable, and permanent as required by EPA 
guidance. See ``Improving Air Quality with Economic Incentive 
Programs,'' EPA-452/R-01-001 (January 2001).
    The 2008 PM2.5 Plan does not identify the incentive 
grant programs expected to generate the emissions reductions programs, 
nor the quantity of the emissions reductions, that the District intends 
to use to meet the contingency measure requirement. Therefore, we are 
unable to determine if they are SIP creditable, surplus to attainment 
and/or RFP needs, or sufficient to provide the one-year's worth of RFP 
needed. For these reasons, this proposed measure does not currently 
meet the CAA requirements for contingency measures.
    Excess Reductions in the RFP Demonstration--The RFP demonstration 
in the 2008 PM2.5 Plan reserves for RFP contingency measure 
purposes about 1 tpd of direct PM2.5 and 17 tpd of 
NOX reductions from the total reductions expected from the 
District and State measures. No reserve is needed for SO2 
because SO2 emissions levels were projected to be below the 
applicable benchmarks. See 2008 PM2.5 Plan, p. 8-3.
    As discussed above in section IV.E., we have proposed to disapprove 
the RFP demonstration in part because we are unable to determine if the 
2008 PM2.5 Plan provides for RFP. We have also identified 
concerns with the lack of an RFP demonstration for VOC and the 
shortfall in NOX emissions reductions needed to show 
generally linear progress toward attainment. Because of these issues, 
we cannot determine, at this time, if there are any excess

[[Page 74539]]

reductions of direct PM2.5 and NOX in the RFP 
demonstration that can be used for RFP contingency measures.
    Post-Attainment Year Emissions Reductions--Additional emissions 
reductions resulting from turnover in the on- and off-road mobile 
source fleet in 2015, the year after the attainment year of 2014, may 
be used to meet the attainment contingency measure requirement. No 
estimates of the additional emissions reductions are given in the 2008 
PM2.5 Plan. CARB estimates the NOX reductions in 
2015 from its existing (baseline) mobile source program are 21 tpd 
(CARB Staff Report, Analysis of the San Joaquin Valley 2008 
PM2.5 Plan, p. 29), and we have estimated an 0.7 tpd 
PM2.5 reduction using information in the 2007 State 
Strategy, Appendix A, p. 100, although this figure is in a tons per 
summer planning day metric and not the average annual day metric that 
is used in the Plan's RFP demonstration. These emissions reductions are 
from already implemented, fully creditable measures and no further 
actions are required by the State to implement them. They are not 
relied on to demonstrate either attainment or RFP. For these reasons, 
these post-2014 emissions reductions may be used to fulfill the 
attainment contingency measure requirement, although based on existing 
estimates of the reductions needed to show one year's worth of RFP, 
they are insufficient by themselves to fully meet the requirement.
    Contingency Provision in Rule 4901 ``Wood Burning Fireplace and 
Wood Burning Heaters''--In October, 2008, the SJVAPCD revised Rule 4901 
to incorporate a contingency provision in section 5.6.5. This provision 
requires that 60 days after EPA finds the SJV nonattainment area has 
failed to attain the 1997 PM2.5 NAAQS, the District will 
lower the level at which mandatory curtailment of residential wood 
burning is required from a predicted level of 30 [micro]g/m\3\ to 20 
[micro]g/m\3\. EPA approved this rule, including the contingency 
provision, on November 10, 2009. 74 FR 57907.
    This attainment contingency provision in Rule 4901 meets the 
statutory and regulatory requirements for attainment contingency 
measures: It is triggered by a failure to attain, requires no 
additional rulemaking by the District, will be fully implemented within 
60 days of being triggered, and is SIP approved. The District has 
preliminarily quantified the emissions reductions expected from this 
contingency provision at 1.6 tons of PM2.5 per winter 
average day.\27\
---------------------------------------------------------------------------

    \27\ Personal communications, Jessica Ferrio, SJVAPCD to Frances 
Wicher, EPA, August 27, 2010.
---------------------------------------------------------------------------

Control Strategy Reductions Not Included in the RFP and/or Attainment 
Demonstrations

    In its resolution approving the SJV PM2.5 Plan, CARB 
requested that the District adopt two additional contingency measures. 
See CARB Resolution No. 08-28, Attachment A. These measures are 
revisions to SJVAPCD's Rule 4307 (Boilers, 2 to 5 MMBtu) and Rule 4702 
(Internal Combustion Engines). While the District had already included 
these rule revisions as Measures S-COM-2 and S-COM-6 in the Plan's 
control strategy, it had not estimated or included the NOX 
emissions reductions from the measures in either the Plan's RFP or 
attainment demonstration. The District adopted revisions to Rule 4307 
in October 2008 and is scheduled to adopt revisions to Rule 4702 in 
December 2010.
    As discussed above, EPA is proposing to disapprove both the RFP and 
attainment demonstrations in the 2008 PM2.5 Plan in part 
because we are unable at this time to determine if the Plan provides 
sufficient emissions reductions to meet these requirements. Until it 
can be shown that the reductions from these two measures are not needed 
to demonstrate either RFP or attainment, EPA cannot approve them as 
contingency measures.
3. Proposed Action on the Contingency Measures
    The 2008 PM2.5 Plan includes suggestions for several 
potentially approvable contingency measures as well as several measures 
that do not currently meet the CAA's minimum requirements (e.g., no 
additional rulemaking, surplus to attainment and RFP needs). The Plan 
does not, however, provide sufficient information for us to determine 
if the emissions reductions from some of the potentially approvable 
measures are SIP creditable (e.g., those from incentive grant programs) 
or does not quantify the expected emissions reductions so we can gauge 
if they provide reductions equivalent to the current estimate of one 
year's worth of RFP. Therefore, we are proposing to disapprove the RFP 
and attainment contingency measure provisions in the 2008 
PM2.5 Plan.

G. Motor Vehicle Emissions Budgets for Transportation Conformity

1. Requirements for Motor Vehicle Emissions Budgets
    CAA section 176(c) requires Federal actions in nonattainment and 
maintenance areas to conform to the goals of SIPs. This means that such 
actions will not: (1) Cause or contribute to violations of a NAAQS, (2) 
worsen the severity of an existing violation, or (3) delay timely 
attainment of any NAAQS or any interim milestone.
    Actions involving Federal Highway Administration (FHWA) or Federal 
Transit Administration (FTA) funding or approval are subject to the 
EPA's transportation conformity rule, codified at 40 CFR part 93, 
subpart A. Under this rule, MPOs in nonattainment and maintenance areas 
coordinate with State and local air quality and transportation 
agencies, EPA, FHWA, and FTA to demonstrate that an area's regional 
transportation plans (RTP) and transportation improvement programs 
(TIP) conform to the applicable SIPs. This is typically determined by 
showing that estimated emissions from existing and planned highway and 
transit systems are less than or equal to the motor vehicle emissions 
budgets (budgets) contained in the SIP. An attainment or RFP SIP should 
include budgets for the attainment year and each required RFP year, as 
applicable.
    Before an MPO may use budgets in a submitted SIP, EPA must first 
determine that the budgets are adequate. In order for us to find a 
budget adequate and, eventually approvable, the submittal must meet the 
conformity adequacy requirements of 40 CFR Sec.  93.118(e)(4) and (5) 
and be approvable under all pertinent SIP requirements. The budget must 
reflect all of the motor vehicle control measures contained in the 
attainment and RFP demonstrations. See 40 CFR 93.118(e)(4)(v).
    PM2.5 attainment and RFP plans should identify budgets 
for direct PM2.5 and PM2.5 attainment plan 
precursors. All direct PM2.5 SIP budgets should include 
direct PM2.5 motor vehicle emissions from tailpipe, brake 
wear, and tire wear. States must also consider whether re-entrained 
paved and unpaved road dust or highway and transit construction dust 
are significant contributors and should be included in the direct 
PM2.5 budget. See 40 CFR 93.102(b) and Sec.  93.122(f) and 
the conformity rule preamble at 69 FR 40004, 40031-40036 (July 1, 
2004). In determining whether the on-road mobile source emissions of a 
PM2.5 attainment plan precursor are significant, state and 
local agencies should use the criteria for

[[Page 74540]]

insignificance findings provided in 40 CFR 93.109(k). See also 70 FR 
24280, 24282-24287 (May 6, 2005).
2. Motor Vehicle Emissions Budgets in the SJV 2008 PM2.5 
Plan
    The 2008 PM2.5 Plan includes budgets for direct 
PM2.5 and NOX for the attainment year of 2014 and 
the RFP years of 2009 and 2012. See 2008 PM2.5 Plan, Section 
7.2.2 and Appendix C. The direct PM2.5 budgets includes 
tailpipe, brake wear, and tire wear emissions but do not include paved 
road, unpaved road, and road and transit construction dust because 
these are considered to be insignificant contributors to 
PM2.5 levels in the Valley. No budgets for SO2 
are included because on-road emissions of SO2 are also 
considered insignificant. Id.
    There are no budgets for ammonia or VOC in the Plan.
3. April 23, 2010 Budget Adequacy/Inadequacy Finding
    On April 23, 2010, we notified CARB that we had found the budgets 
in the 2008 PM2.5 Plan for the RFP milestone years 2009 and 
2012 adequate and for the attainment year of 2014 inadequate for 
transportation conformity purposes. EPA determined that the attainment 
year budgets are inadequate because they lack specificity and are not 
fully enforceable and, therefore, do not meet the criteria for adequacy 
in 40 CFR 93.118(e)(4).\28\ We published a notice of our findings at 75 
FR 26749 (May 12, 2010).
---------------------------------------------------------------------------

    \28\ See letter, Deborah Jordan, Air Division Director, EPA 
Region 9, to James M. Goldstene, Executive Officer, CARB, ``RE: 
Adequacy Status of San Joaquin Valley PM2.5 Reasonable 
Further Progress and Attainment Plan Motor Vehicle Emissions 
Budgets,'' dated April 23, 2010.
---------------------------------------------------------------------------

4. Proposed Action on the Budgets
    Our finding that the 2009 and 2012 year RFP budgets are adequate 
for transportation conformity purposes was based on our preliminary 
review of the RFP demonstrations in the 2008 PM2.5 Plan. 
After a more in-depth review of these demonstrations and the Plan as a 
whole, we are proposing to disapprove the Plan's RFP demonstration for 
the reasons discussed above in section IV.E. Based on this proposed 
disapproval, we are now proposing to disapprove the 2009 and 2012 year 
RFP budgets because they are not consistent with requirements for RFP 
as required by 40 CFR 93.118(e)(4)(iv). We are also proposing to 
disapprove the budgets for the attainment year of 2014, which we have 
already found to be inadequate, based on our proposed disapproval of 
the SJV 2008 PM2.5 Plan's attainment demonstration. See 
section IV.D. above.
    As discussed above, EPA is proposing to find that VOC is a 
PM2.5 attainment plan precursor in the San Joaquin Valley. 
Should we finalize this determination, the State should include budgets 
for VOC as well as for direct PM2.5 and other attainment 
plan precursors as applicable in future revisions to the Plan.

H. Mid-Course Review

    Any State that submits to EPA an attainment plan for a 
PM2.5 nonattainment area with an attainment date of 2014 or 
2015 must also submit to EPA a mid-course review (MCR) by April 2011. 
40 CFR 51.1011. The MCR for an area should include: (1) A review of 
emissions reductions and progress made in implementing control measures 
to reduce emissions of direct PM2.5 and PM2.5 
attainment plan precursors contributing to PM2.5 
concentrations in the area; (2) an analysis of changes in ambient air 
quality data for the area; (3) a revised air quality modeling analysis 
to demonstrate attainment; and (4) any new or revised control measures 
adopted by the State, as necessary to ensure attainment by the 
attainment date in the EPA-approved SIP for the nonattainment area. 40 
CFR 51.1011(b).
    In its resolution adopting the 2008 PM2.5 Plan, the 
SJVAPCD's Governing Board acknowledges the requirement to prepare a 
mid-course review consistent with 40 CFR 51.1011 by April 2011. See 
SJVAPCD Governing Board Resolution, page 4. In its resolution adopting 
the 2008 PM2.5 Plan, CARB commits to submitting a MCR in 
2011. See CARB Resolution 08-28, May 22, 2008, p. 4.
    SJVAPCD is already taking the initial steps necessary to prepare 
its PM2.5 MCR. EPA will work closely with the District, 
CARB, and other interested parties to assure that the MCR addresses the 
elements required by the PM2.5 implementation rule. We 
encourage both agencies to use the opportunity afforded by the MCR to 
address the proposed disapprovals of the 2008 PM2.5 Plan and 
SJV portions of the revised 2007 State Strategy.

I. Inter-Pollutant Trading for PM2.5 Offsets

    EPA has issued an implementation rule establishing the requirements 
for New Source Review (NSR) programs in PM2.5 nonattainment 
areas. See 73 FR 28321 (May 16, 2008) (PM2.5 NSR rule). 
Under the PM2.5 NSR rule, during the interim period after 
designation of an area as nonattainment but before a state has amended 
its NSR SIP to address PM2.5, the NSR permitting 
requirements of 40 CFR part 51, Appendix S apply for PM2.5 
purposes.\29\ 40 CFR 52.24(k); 73 FR 28321 at 28342. These Appendix S 
requirements currently apply in the SJV area.
---------------------------------------------------------------------------

    \29\ A state with a PM2.5 nonattainment area is 
required to submit NSR SIP revisions in accordance with the 
requirements of the PM2.5 NSR rule by May 16, 2011. 73 FR 
28321 at 28342.
---------------------------------------------------------------------------

    The NSR program requires, among other things, that new or modifying 
major stationary sources offset significant net emission increases with 
creditable emissions reductions. 40 CFR part 51, Appendix S, section 
IV.A.3. Under Appendix S, section IV.G.5, these offset requirements may 
currently be satisfied by offsetting reductions of direct 
PM2.5 emissions. They may also currently be satisfied by 
offsetting reductions of emissions of a PM2.5 precursor 
(i.e., by an interpollutant trade) but only if such offsets comply with 
an interprecursor trading hierarchy and ratio approved by the 
Administrator. That is, a new PM2.5 emission source is 
allowed to offset its direct PM2.5 and/or PM2.5 
precursor emission increases with reductions in other PM2.5 
precursor emissions only in accordance with a trading ratio approved by 
EPA.\30\
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    \30\ Note that several provisions of the PM2.5 NSR 
rule are currently under reconsideration, including EPA's preferred 
interpollutant trading ratios. See Letter, from Lisa P. Jackson, 
Administrator, EPA, to Paul R. Cort, Earthjustice, April 24, 2009; 
74 FR 26098 (June 1, 2009); 74 FR 36427 (July 23, 2009); 74 FR 48153 
(September 22, 2009); and 75 FR 6827 (February 11, 2010).
---------------------------------------------------------------------------

    The PM2.5 NSR rule preamble states that precursors that 
are significant contributors to PM2.5 concentrations should 
be considered regulated NSR pollutants. 73 FR 28321 at 28326. It then 
describes ``significant contribution'' in the same terms as are used in 
the PM2.5 implementation rule, namely that emissions 
reductions of the precursor would be projected to provide a significant 
change in PM2.5 concentrations in the area. See 72 FR 20586 
at 20590 and 73 FR 28321 at 28326. The two rules also have the same 
presumption, for essentially the same reasons, that SO2 and 
NOX should be considered precursors, whereas ammonia and VOC 
should not. See 72 FR 20586 at 20590-20596 and 73 FR 28321 at 28326-
28331.
    In order for precursors to be eligible for NSR interpollutant 
offset trading in a PM2.5 nonattainment area, the area's 
PM2.5 SIP must state which combinations of pollutants are 
eligible for interpollutant trading and define and provide the basis 
for the trading ratios between them that will be used for 
interpollutant offsets. In the 73 FR 28321 at 28339, EPA stated that:


[[Page 74541]]


    [T]he final rules allow interpollutant trading [for offset 
purposes] only based on a trading ratio established in the SIP as 
part of the attainment demonstration approved for a specific 
nonattainment area * * *. [T]he final rules do not allow 
interpollutant trading on a case-by-case basis as part of an 
individual [nonattainment area] NSR permitting process. * * * If 
States choose to develop their own hierarchies/trading ratios, they 
will have to substantiate by modeling and/or other technical 
demonstrations of the net air quality benefit for PM2.5 
ambient concentrations, and such a trading program will have to be 
approved by EPA.

``Hierarchy'' refers to an identification of which combinations of 
pollutants are eligible for trading, e.g., SO2 for primary 
PM2.5, SO2 for NOX, etc.
    EPA completed a technical assessment to develop preferred 
interpollutant trading ratios that may be used for the purposes of 
PM2.5 offsets, where appropriate.\31\ Based on this 
assessment, EPA disallowed trading directly between NOX and 
SO2 and set preferred trading ratios at 100:1 for 
NOX to primary PM2.5 trades and 40:1 for 
SO2 to primary PM2.5 trades. See 73 FR 28321 at 
28339. The PM2.5 NSR rule preamble also states at 28340 
that:
---------------------------------------------------------------------------

    \31\ These factors are in addition to the overall goal of the 
NSR permitting to show net air quality benefit and the underlying 
rationale for offsets to provide progress toward NAAQS attainment 
while allowing new sources to be constructed and existing sources to 
expand.

    th[e] rule allows interpollutant and interprecursor trading of 
offsets according to a SIP-approved trading program. To be approved, 
the trading program must either adopt EPA's recommended trading 
ratios or be supported by regional-scale modeling that demonstrates 
a net air quality benefit using appropriate overall offset ratios 
for such trades for a specified nonattainment area, State, or multi-
---------------------------------------------------------------------------
State region.

    The PM2.5 NSR rule preamble at 28339 describes factors 
that should be considered by a State in developing area-specific 
ratios. Additional considerations for developing such ratios for the 
SJV are discussed in section II.K. of the TSD.
    In summary, interpollutant trades for purposes of meeting the NSR 
offset requirement for PM2.5 emissions are permissible only 
in accordance with trading ratios established in the SIP as part of the 
attainment demonstration approved for the nonattainment area. The SIP 
must explicitly identify which precursors are ``regulated NSR 
pollutants'', which combinations are eligible for interpollutant 
trading, and the trading ratios between the pollutants. A state may 
either adopt EPA's recommended trading ratios (73 FR 28321 at 28339) or 
seek to establish alternative ratios, using modeling and/or other 
technical demonstrations showing that the trading ratios provide a net 
air quality benefit, which must be approved by EPA. A state must 
establish these ratios as part of an approved attainment demonstration 
for its area; EPA will not allow case-by-case demonstrations on an 
individual source permit basis.
    The SJV 2008 PM2.5 Plan does not explicitly identify 
PM2.5 precursors that are subject to NSR permitting. The 
Plan states, however, that:

    [SJVAPCD] Rule 2201 [New and Modified Stationary Source Review] 
allows the use of interpollutant trading amongst criteria pollutants 
and their precursors upon the appropriate scientific demonstration 
of an adequate trading ratio. These caps [on the use of pre-baseline 
credits] also apply to the use of VOC, NOX, and 
SOx [emission reduction credits] in their application as 
offsets for direct emissions and in their use as PM2.5 
precursor interpollutant offsets.

See 2008 PM2.5 Plan, Appendix D, p. D-4.

    It appears from this discussion that the District considers VOC, 
NOX, and SO2 to be ``regulated NSR pollutants'' 
for PM2.5 NSR purposes and that the District intends to 
allow for interpollutant trading to satisfy PM2.5 permit 
requirements.\32\ The SJV PM2.5 Plan does not, however, 
provide a technical demonstration to support any conclusion as to the 
precursor combinations that should be eligible for interpollutant 
trading or the appropriate trading ratio for use in NSR permitting for 
PM2.5. It also appears from the Plan (at Appendix D, p. D-4) 
that the District intends to allow for interpollutant trades to satisfy 
PM2.5 offset requirements on a case-by-case basis, which is 
not permissible under the PM2.5 NSR rule. If the District 
intends to seek EPA approval of alternative interpollutant offset 
ratios for purposes of meeting PM2.5 NSR offset 
requirements, it must submit an adequate technical demonstration to 
support its proposed ratios, together with an approvable attainment 
demonstration, consistent with EPA regulatory requirements.
---------------------------------------------------------------------------

    \32\ This identification of VOC as a regulated NSR pollutant for 
PM2.5 is contrary to the District's assertions in the 
Plan that controls on VOC sources are not important for 
PM2.5 attainment but supports EPA's proposal to determine 
that VOC should be considered a PM2.5 attainment plan 
precursor in addition to NOX and SO2. See 
section IV.C. above.
---------------------------------------------------------------------------

V. EPA's Proposed Actions and Potential Consequences

A. EPA's Proposed Approvals and Disapprovals

    For the reasons discussed above, EPA is proposing to approve in 
part and disapprove in part California's attainment SIP for the San 
Joaquin Valley nonattainment area for the 1997 PM2.5 NAAQS. 
This SIP is comprised of the SJVAPCD's 2008 PM2.5 Plan and 
the portions of CARB's revised 2007 State Strategy that address CAA and 
EPA regulations for attainment of the 1997 PM2.5 NAAQS in 
the SJV nonattainment area.
    EPA is proposing to approve under CAA section 110(k)(3) the 
following elements of the SJV PM2.5 attainment SIP:
    1. The SIP's base year and baseline emissions inventories as 
meeting the requirements of CAA section 172(c)(3) and 40 CFR 51.1008.
    2. SJVAPCD's commitments to the adoption and implementation 
schedule for specific control measures listed in Table 6-2 (amended 
June 15, 2010) of the 2008 PM2.5 Plan to the extent that 
these commitments have not yet been fulfilled and to achieve specific 
aggregate emissions reductions of direct PM2.5, 
NOX and SO2 by year, as listed in Table 6-3 of 
the PM2.5 Plan, as a SIP strengthening; and
    3. CARB's commitments to propose certain defined measures, as 
listed on page 23 of the 2009 State Strategy Status Report and to 
achieve aggregate emissions reductions of 5 tpd direct 
PM2.5, 76 tpd NOX, and 23 tpd VOC in the San 
Joaquin Valley by 2014, as listed in the 2009 State Strategy Status 
Report, p. 21, as a SIP strengthening; and to submit a mid-course 
review on the SJV PM2.5 Plan as stated in the CARB 
Resolution 08-28, p. 4.
    EPA is also proposing to find pursuant to 40 CFR 51.1002(c), that 
VOC is a PM2.5 attainment plan precursor for the SJV and, 
therefore, controls on sources of VOC must be evaluated as part of the 
control strategy in the SJV PM2.5 attainment SIP.
    EPA is proposing to disapprove under CAA section 110(k)(3) the 
following elements of the SJV PM2.5 attainment SIP:
    1. The reasonably available control measures/reasonably available 
control technology demonstration as failing to meet the requirements of 
CAA section 172(c)(1) and 40 CFR 51.1010;
    2. The reasonable further progress demonstrations for failing to 
meet the requirements of CAA section 172(c)(2) and 40 CFR 51.1009;
    3. The attainment demonstration for failing to meet the 
requirements of CAA sections 172(c)(1) and (6) and 40 CFR 51.1007;
    4. The contingency measures for failing to meet the requirements of 
CAA section 172(c)(9) and 40 CFR 51.1012; and

[[Page 74542]]

    5. The RFP and attainment years motor vehicle emissions budgets 
because they are derived from unapprovable RFP and attainment 
demonstrations.
    Finally, we are proposing to not grant, pursuant to CAA section 
172(a)(2)(A) and 40 CFR 51.1004(a), California's request to extend the 
attainment date for the San Joaquin Valley PM2.5 
nonattainment area to April 5, 2015.

B. CAA Consequences of a Final Disapproval

    EPA is committed to working with the SJVAPCD, CARB and the SJV MPOs 
to resolve the problems that make the current PM2.5 
attainment SIP for the SJV not fully approvable under the CAA and the 
PM2.5 implementation rule. We firmly believe that such 
solutions are available and that expeditious attainment of the 1997 
PM2.5 standards in the San Joaquin Valley is achievable.
    However, should we finalize the disapprovals as proposed here, a 
conformity freeze will take effect once the action becomes effective 
(usually 30 days after publication of the final action in the Federal 
Register). A conformity freeze means that only projects in the first 
four years of the most recent conforming RTP and TIP can proceed. 
During a freeze, no new RTPs, TIPs or RTP/TIP amendments can be found 
to conform. See 40 CFR 93.120.
    Should we finalize the disapprovals proposed here, in addition to 
the effect on conformity, the offset sanction in CAA section 179(b)(2) 
would apply in the SJV PM2.5 nonattainment area 18 months 
after the effective date of a final disapproval. The highway funding 
sanctions in CAA section 179(b)(1) would apply in the area six months 
after the offset sanction is imposed. Neither sanction will be imposed 
under the CAA if California submits and we approve prior to the 
implementation of the sanctions, SIP revisions that correct any and all 
disapproval issues with the 2008 PM2.5 Plan and applicable 
portions of the revised 2007 State Strategy that we identify in our 
final action.
    In addition to the sanctions, CAA section 110(c)(1) provides that 
EPA must promulgate a federal implementation plan addressing the 
deficient elements in the PM2.5 SIP for the SJV 
nonattainment area, two years after the effective date of any 
disapproval should we not approve a SIP revision correcting the 
deficiencies within the two years.

VI. Statutory and Executive Order Reviews

    Under the CAA, the Administrator is required to approve a SIP 
submittal that complies with the provisions of the Act and applicable 
Federal regulations. 42 U.S.C. 7410(k); 40 CFR 52.02(a). Thus, in 
reviewing SIP submittals, EPA's role is to approve State choices, 
provided that they meet the criteria of the CAA. Accordingly, this 
action merely proposes to partially approve and partially disapprove 
State law as meeting Federal requirements and does not impose 
additional requirements beyond those imposed by State law.

A. Executive Order 12866, Regulatory Planning and Review

    This action is not a ``significant regulatory action'' under the 
terms of Executive Order (EO) 12866 (58 FR 51735, October 4, 1993) and 
is therefore not subject to review under the EO.

B. Paperwork Reduction Act

    This action does not impose an information collection burden under 
the provisions of the Paperwork Reduction Act, 44 U.S.C. 3501 et seq, 
because this proposed SIP partial approval and partial disapproval 
under CAA section 110 and subchapter I, part D will not in-and-of 
itself create any new information collection burdens but simply 
disapproves certain State requirements for inclusion into the SIP. 
Burden is defined at 5 CFR 1320.3(b).

C. 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. For purposes of assessing the impacts of today's rule on 
small entities, small entity is defined as: (1) A small business as 
defined by the Small Business Administration's (SBA) regulations at 13 
CFR 121.201; (2) a small governmental jurisdiction that is a government 
of a city, county, town, school district or special district with a 
population of less than 50,000; and (3) a small organization that is 
any not-for-profit enterprise which is independently owned and operated 
and is not dominant in its field.
    After considering the economic impacts of today's proposed rule on 
small entities, I certify that this action will not have a significant 
impact on a substantial number of small entities. This rule does not 
impose any requirements or create impacts on small entities. This 
proposed partial approval and partial disapproval of the SIP under CAA 
section 110 and subchapter I, part D will not in-and-of itself create 
any new requirements but simply disapproves certain State requirements 
for inclusion into the SIP. Accordingly, it affords no opportunity for 
EPA to fashion for small entities less burdensome compliance or 
reporting requirements or timetables or exemptions from all or part of 
the rule. The fact that the CAA prescribes that various consequences 
(e.g., higher offset requirements) may or will flow from a final 
disapproval does not mean that EPA either can or must conduct a 
regulatory flexibility analysis for this action. Therefore, this action 
will not have a significant economic impact on a substantial number of 
small entities.
    We continue to be interested in the potential impacts of this 
proposed rule on small entities and welcome comments on issues related 
to such impacts.

D. Unfunded Mandates Reform Act

    This action contains no Federal mandates under the provisions of 
Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), 2 U.S.C. 
1531-1538 for State, local, or tribal governments or the private 
sector.'' EPA has determined that the proposed partial approval and 
partial disapproval action 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. This action proposes to partially approve and partially 
disapprove pre-existing requirements under State or local law, and 
imposes no new requirements. Accordingly, no additional costs to State, 
local, or tribal governments, or to the private sector, result from 
this action.

E. Executive Order 13132, Federalism

    Executive Order 13132, entitled ``Federalism'' (64 FR 43255, August 
10, 1999), 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.''
    This action does not have federalism implications. It will not have 
substantial direct effects on the States, on the

[[Page 74543]]

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 merely 
partially approves and partially disapproves certain State requirements 
for inclusion into the SIP and does not alter the relationship or the 
distribution of power and responsibilities established in the CAA. 
Thus, Executive Order 13132 does not apply to this action.

F. Executive Order 13175, Coordination With Indian Tribal Governments

    This action does not have tribal implications, as specified in 
Executive Order 13175 (65 FR 67249, November 9, 2000), because the SIP 
EPA is proposing to partially approve and partially disapprove would 
not apply in Indian country located in the State, and EPA notes that it 
will not impose substantial direct costs on tribal governments or 
preempt tribal law. Thus, Executive Order 13175 does not apply to this 
action.

G. Executive Order 13045, Protection of Children From Environmental 
Health Risks and Safety Risks

    EPA interprets EO 13045 (62 FR 19885, April 23, 1997) as applying 
only to those regulatory actions that concern health or safety risks, 
such that the analysis required under section 5-501 of the EO has the 
potential to influence the regulation. This action is not subject to EO 
13045 because it is not an economically significant regulatory action 
based on health or safety risks subject to Executive Order 13045 (62 FR 
19885, April 23, 1997). This proposed partial approval and partial 
disapproval of the SIP under CAA section 110 and subchapter I, part D 
will not in-and-of itself create any new regulations but simply 
disapproves certain State requirements for inclusion into the SIP.

H. Executive Order 13211, Actions That Significantly Affect Energy 
Supply, Distribution, or Use

    This proposed rule is not subject to Executive Order 13211 (66 FR 
28355, May 22, 2001) because it is not a significant regulatory action 
under Executive Order 12866.

I. National Technology Transfer and Advancement Act

    Section 12(d) of the National Technology Transfer and Advancement 
Act of 1995 (NTTAA), Public Law 104-113, 12(d) (15 U.S.C. 272 note) 
directs EPA to use voluntary consensus standards in its regulatory 
activities unless to do so would be inconsistent with applicable law or 
otherwise impractical. Voluntary consensus standards are technical 
standards (e.g., materials specifications, test methods, sampling 
procedures, and business practices) that are developed or adopted by 
voluntary consensus standards bodies. NTTAA directs EPA to provide 
Congress, through OMB, explanations when the Agency decides not to use 
available and applicable voluntary consensus standards.
    The EPA believes that this action is not subject to requirements of 
Section 12(d) of NTTAA because application of those requirements would 
be inconsistent with the CAA.

J. Executive Order 12898: Federal Actions To Address Environmental 
Justice in Minority Populations and Low-Income Populations

    Executive Order (EO) 12898 (59 FR 7629 (Feb. 16, 1994)) establishes 
federal executive policy on environmental justice. Its main provision 
directs federal agencies, to the greatest extent practicable and 
permitted by law, to make environmental justice part of their mission 
by identifying and addressing, as appropriate, disproportionately high 
and adverse human health or environmental effects of their programs, 
policies, and activities on minority populations and low-income 
populations in the United States.
    EPA lacks the discretionary authority to address environmental 
justice in this proposed action. In reviewing SIP submittals, EPA's 
role is to approve or disapprove State choices, based on the criteria 
of the CAA. Accordingly, this action merely proposes to partially 
approve and partially disapprove certain State requirements for 
inclusion into the SIP under CAA section 110 and subchapter I, part D 
and will not in-and-of itself create any new requirements. Accordingly, 
it does not provide EPA with the discretionary authority to address, as 
appropriate, disproportionate human health or environmental effects, 
using practicable and legally permissible methods, under Executive 
Order 12898.

List of Subjects in 40 CFR Part 52

    Environmental protection, Air pollution control, Nitrogen dioxide, 
Particulate matter, Reporting and recordkeeping requirements, Sulfur 
oxides, Volatile organic compounds.

    Authority:  42 U.S.C. 7401 et seq.

     Dated: November 8, 2010.
Jared Blumenfeld,
Regional Administrator, EPA Region IX.
[FR Doc. 2010-29248 Filed 11-29-10; 8:45 am]
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