Approval and Promulgation of Implementation Plans; Minnesota

ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[MN32-1-6373; FRL-5028-4]

Approval and Promulgation of Implementation Plans; Minnesota

AGENCY: United States Environmental Protection Agency (USEPA).

ACTION: Proposed rule.

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SUMMARY: On November 10, 1992, the Minnesota Pollution Control Agency

(MPCA) submitted a SIP revision which included two elements: (1) a

commitment from the Governor or his designee to the timely adoption and

implementation of an I/M program meeting all requirements of the I/M

regulation; and (2) a schedule of implementation. On December 15, 1993,

the MPCA fulfilled its commitment by submitting proposed revisions to

its State Implementation Plan (SIP) for carbon monoxide (CO) to USEPA

for approval. The submittal requests approval of its basic inspection

and maintenance (I/M) program which applies to the Twin Cities seven

county metropolitan area. The Twin Cities seven county metropolitan

area, which includes Anoka, Carver, Dakota, Hennepin, Ramsey, Scott and

Washington Counties, has been classified as moderate nonattainment for

carbon monoxide. Therefore, Section 187 of the Clean Air Act (CAA)

requires the State to submit a basic I/M SIP. In this action, the USEPA

is proposing conditional approval of the State's basic I/M program

submittal.

DATES: Comments on this requested revision and on the proposed USEPA

action must be received by September 6, 1994.

ADDRESSES: Copies of the SIP revision request and USEPA's analysis are

available for inspection at the following address: (It is recommended

that you telephone Gina Smith at (312) 886-7018, before visiting the

Region 5 office.) U.S. Environmental Protection Agency, Region 5, Air

and Radiation Division, 77 West Jackson Boulevard, Chicago, Illinois

60604.

Written comments should be sent to: William L. MacDowell, Chief,

Regulation Development Section, Air Enforcement Branch (AE-17J), U.S.

Environmental Protection Agency, 77 West Jackson Boulevard, Chicago,

Illinois 60604.

FOR FURTHER INFORMATION CONTACT: Gina Smith, Regulation Development

Section, Air Enforcement Branch (AE-17J), U.S. Environmental Protection

Agency, Region 5, Chicago, Illinois 60604, (312) 886-7018.

SUPPLEMENTARY INFORMATION:

I. Background

Section 187(a)(4) of the CAA, as amended in 1990, requires States

with areas designated moderate nonattainment for CO to make changes to

improve existing I/M programs or implement new ones. Section

182(a)(2)(B) requires USEPA to review, revise, update, and republish in

the Federal Register guidance for State motor vehicle I/M programs. On

November 5, 1992, (57 FR 52950), USEPA published a final rule

establishing performance standards and other requirements for basic and

enhanced I/M programs.

The November 5, 1992, I/M Regulation required each State that must

implement an I/M program to submit by November 15, 1992, a SIP revision

including two elements: (1) A commitment from the Governor or his

designee to the timely adoption and implementation of an I/M program

meeting all requirements of the I/M regulation; and (2) a schedule of

implementation. A memorandum dated December 11, 1992, from Phil Lorang,

Director, Emission Planning and Strategies Division outlines the

elements that a State's schedule of implementation must include for

acceptability. These elements include:

1. Passage of enabling statutory or other legal authority;

2. Proposal of draft regulations and promulgation of final

regulations;

3. Issuance of final specifications and procedures;

4. Issuance of final request for Proposals (if applicable);

5. Licensing or certification of stations and inspectors;

6. The date mandatory testing will begin for each model year to be

covered by the program;

7. The date full-stringency cut-points will take effect; and

8. All other relevant dates.

Following publication of the I/M program final rule (57 FR 52950),

the USEPA also made available to States a document entitled, Checklist

for Completing the Inspection/Maintenance SIP (Checklist). The

Checklist was developed to assist States in the development of I/M SIPs

and outlines in detail the criteria the I/M SIP submittals must satisfy

in order to be approved for incorporation into a State's federally

approved SIP.

II. Summary of State Submittal

In 1988 the MPCA was authorized and directed by the State

legislature to adopt rules establishing an I/M program in the Twin

Cities seven county metropolitan area. As required by Minnesota Statute

Section 116.62, the MPCA adopted Minnesota Rules parts 7023.1010 to

7023.1105, which established standards and criteria governing the

testing and inspection of motor vehicles for CO and hydrocarbon

emissions in the Twin Cities seven county metropolitan area. Vehicle

testing began on July 1, 1991.

Upon publication of the USEPA's final rule for I/M Programs (57 FR

52950), the MPCA recognized the need to amend the rules for operation

of the State's I/M program. The State submitted a committal SIP on

November 10, 1992. Additional information was provided on December 14,

1992, on January 6, 1993, and on February 22, 1993. A public hearing on

the committal SIP was held by the State on February 22, 1993. The

submittal includes a commitment for the adoption and implementation of

an I/M program meeting all requirements of the I/M regulation and the

CAA, a schedule of implementation which contained the elements

described in Phil Lorang's December 11, 1992 memorandum, and a

submittal date to USEPA of November 15, 1993.

On November 15, 1993, the Minnesota Pollution Control Agency (MPCA)

submitted the first of two parts of its State Implementation Plan (SIP)

revision request for the Twin Cities seven country metropolitan area I/

M program. The second part of the revision request, consisting of the

public hearing notice, was received by USEPA on December 15, 1993. The

submittal requests approval of the Minnesota I/M program which has been

operating in the Twin Cities metropolitan area since July 1, 1991. The

seven county metropolitan area includes Anoka, Carver, Dakota,

Hennepin, Ramsey, Scott and Washington Counties, which have been

designated moderate nonattainment for carbon monoxide (CO).

III. Review of State Submittal

The basic I/M program SIP submittal has been reviewed against the

requirements of the November 5, 1992, final rule and approvability

criteria of the USEPA Checklist. An analysis of whether the Minnesota

basic I/M program satisfies the requirements of the final rule and

Checklist is provided below.

Applicability

Section 51.350 of the final rule requires I/M SIP submittals to

describe the applicable areas in detail and to include the legal

authority or rules necessary to establish program boundaries. The Twin

Cities seven county metropolitan area has been classified as moderate

nonattainment for CO and has a design value less than 12.7 ppm.

Therefore, the area is required to implement a Basic I/M program as

part of the State's CO SIP.

On April 8, 1988 Minnesota Statute Secs. 116.60-116.65 was enacted

by the Minnesota legislature, establishing a basic I/M program in the

Twin Cities seven county metropolitan area and directing MPCA to

develop and adopt administrative rules to govern the I/M program.

Minnesota Rules parts 7023.1010--7023.1105 were adopted by the MPCA

Citizen's Board on July 25, 1989. Minnesota's centralized I/M program

has been in operation since July 1991. The geographic coverage of the

program complies with the requirements of the Federal I/M rule and is

approvable.

Basic I/M Performance Standard

Section 51.352 outlines the method States are to follow to arrive

at a minimum performance standard. The performance standard sets an

emission reduction target that the program must meet in order for the

SIP to be approvable. The SIP must also demonstrate that the program

will meet the performance standard in actual operation, with provisions

for appropriate adjustments if the standard is not met.

The performance standard for which the MPCA must be able to

demonstrate compliance was established using the Mobile 5a model inputs

and local characteristics outlined at Sec. 51.352(a)(1)-(12). CO

nonattainment areas are required to demonstrate compliance with the

performance standard by 1996. The State has submitted a modeling

demonstration using the EPA computer model Mobile 5a demonstrating

compliance with the basic performance standard.

Network Type and Evaluation

Section 51.353 of the final rule requires SIPs to include a

description of the network to be employed, the required legal

authority, and a description of the evaluation schedule and protocol,

sampling methodology, the data collection and analysis system, the

resources and personnel for evaluation, and related details of the

evaluation program. Areas that are required to implement basic I/M

programs can at their own discretion choose between a centralized,

decentralized, or hybrid testing network as long as the program

demonstrates compliance with the performance standard of Section

51.352.

Through a contractual agreement, Minnesota operates a centralized

program, consisting of eleven inspection stations with 46 testing

lanes. The MPCA compiles data on failure rate, compliance rate, the

number of certificates issued, and other similar matters and publishes

an annual report on the I/M program.

Adequate Tools & Resources

Section 51.354 requires States to demonstrate that the appropriate

administrative, budgetary, personnel, and equipment resources have been

allocated for the I/M program and discuss how the performance standard

will be met. Appendix 10 of the submittal contains the fiscal year 1994

budget for the I/M program. The submittal also provides a description

of the program staffing levels and equipment resources.

Test Frequency & Convenience

Section 51.355 requires the SIP to describe in detail the test

schedule of the program. If testing is not performed on an annual

basis, the description is to include the test year selection scheme. In

addition, the SIP should include the legal authority necessary to

implement and enforce the test frequency requirement and explain how

the test frequency will be integrated with the enforcement process.

Minnesota's program is based upon annual testing. Vehicle owners

subject to the program are required to submit their vehicles to testing

prior to annual vehicle registration renewal. The State's vehicle

registration program is administered by the Minnesota Department of

Public Safety. The Department of Public Safety's vehicle registration

computer system tracks those vehicle owners who are required to provide

proof of compliance with the I/M program, in order to renew vehicle

registration.

Vehicle Coverage

SIPs are to include a detailed description of the number and types

of vehicles to be covered by the program and a plan for how those

vehicles are to be identified. The SIP should also include a

description of any special exemptions granted by the program, an

estimate of the percentage and number of subject vehicles which will be

exempted. Exempted vehicles should be accounted for in the emission

reduction analysis. The SIP should also include the legal authority or

rule necessary to implement and enforce the vehicle coverage

requirement.

Vehicles subject to the Minnesota basic I/M performance standard

include: vehicles registered or required to be registered within the

Twin Cities metropolitan area boundaries; fleet vehicles primarily

operated within the I/M program area boundaries; and Federal vehicles

located within the I/M program area boundaries. The Minnesota program

subjects all 1976 and newer model year vehicles registered or

customarily domiciled in the Twin Cities seven county area to the I/M

program. Vehicles with exchanged engines that were manufactured before

1976 are not subject to I/M testing. Although Section 51.356 states

that the performance standard for basic I/M assumes coverage of all

1968 and later light duty vehicles, States can adopt other levels of

model year coverage provided if the necessary emission reductions are

achieved.

The Checklist requests that States provide a description of the

number and types of vehicles subject to the I/M program and a plan for

how subject vehicles will be identified. Appendix 12 of the Submittal

provides a detailed inventory of vehicles tested by model year between

July 1, 1992, and June 30, 1992. Vehicles required to undergo testing

are identified by the Minnesota Department of Public Safety as part of

the annual vehicle registration and license plates renewal process.

The Minnesota I/M program exempts the following vehicles from the

I/M program:

1. Motor vehicles manufactured before the 1976 model year or with

an engine manufactured before the 1976 model year.

2. Motor vehicles registered as classic, pioneer, collector, or

street rod.

3. Motor vehicles that are exempted in accordance with rules of the

MPCA because the vehicle, although registered to an owner residing in

the metropolitan area, is customarily domiciled outside the

metropolitan area.

4. Any class of vehicles that is exempted by rule of the MPCA

because the vehicles present prohibitive inspection problems, or are

inappropriate for inspection. These include vehicles powered solely by

diesel fuel, natural gas, propane, pure alcohol, or hydrogen; fire

apparatus, ambulances, and rescue vehicles. Vehicles that have been

identified as ``dual fuel'' are required to be tested using their

gasoline cycle only.

The Minnesota SIP submittal provides an estimate of the number of

vehicles exempted due to vehicle age, fuel type, and engines type.

These exempted vehicles are accounted for in the compliance rate which

was used in the Mobile 5a modeling process to demonstrate compliance

with the performance standard.

Test Procedures and Standards

Section 51.357 requires SIPs to include a description of each test

procedure used, the legal authority or rule describing and establishing

the test procedures, and the test standards.

The Minnesota I/M program includes a tampering inspection and an

exhaust emission test (Minnesota Rules parts 7023.1025 and 7023.1030).

The USEPA Checklist lists the criteria that State I/M programs must

satisfy in order to be approvable. The Minnesota program satisfies the

criteria of the Checklist.

Minnesota Rules pt. 7023.1010, subp. 35 exempts vehicles from

testing that are powered solely by diesel fuel, electricity, natural

gas, propane, pure alcohol, or hydrogen (alternate fuel vehicles). The

State believes and USEPA agrees that there are so few alternate fuel

vehicles that there is no significant impact upon ambient air quality.

Vehicles that are ``dual fuel'' are tested using the gasoline cycle and

must meet the same test requirements as all other vehicles subject to

the program requirements.

The Minnesota program tests vehicles with exchanged engines that

were manufactured before 1976 according to the emission standards

applicable to the year of the exchanged engine and tests vehicles where

the year of the exchanged engine is unknown according to the standard

applicable to 1976 engines. Section 51.357(d)(2) requires vehicles with

exchanged engines to be subject to the emission standards based on the

chassis type and model year, not the engine year as the Minnesota rule

allows. Engine year standards can only be used if the engine is newer

than the chassis and subject to stricter emission control requirements.

In a letter from Charles Williams, Commissioner MPCA, dated July 5,

1994 to Valdas Adamkus, Regional Administrator, the MPCA committed to

requesting statutory and rule amendments that are consistent with USEPA

final regulations. USEPA proposes to conditionally approve the SIP

based on this commitment. MPCA must submit these amendments as a SIP

revision within one year of final conditional approval.

Test Equipment

Section 51.358 of the final rule requires SIPs to include written

technical specifications for all test equipment used in the program.

The specifications should describe the emission analysis process, the

necessary test equipment, the required features, and written acceptance

testing criteria and procedures.

Appendix 11 of the Minnesota submittal and Minnesota Rules

7023.1090 contains the specifications for the test equipment used in

the I/M program. The gas analyzers used in the program each meet or

exceed the California Bureau of Automotive Repair bench specifications

and meet or exceed the specifications contained in Appendices A, B, and

D of the I/M final rule.

Quality Control

Section 51.359 of the I/M final regulations requires SIPs to

include a description of quality control and recordkeeping procedures.

The submittal should include the procedures manual, rule, ordinance, or

law establishing the procedures of quality control and recordkeeping.

Minnesota Rules pts. 7023.1010-7023.1105 and Appendix 11 of the

submittal describe the quality control standards and criteria for the

I/M program. Specifications for the test equipment used in the I/M

program are also located in Appendix 11 of the submittal.

Waivers and Compliance via Diagnostic Inspection

Section 51.360 outlines the standards that State SIP submittals

must satisfy before owners of vehicles can be issued waivers or

temporary extensions. A waiver or temporary extension allows motorists

to renew vehicle registration. These requirements include: a maximum

waiver rate used for estimating emission reduction benefits in the

modeling analysis; a commitment by the State to take corrective action

if the waiver rate exceeds that which was committed to in the SIP or a

commitment to revise the SIP and emission reductions claimed; a

description of waiver criteria and procedures, including cost limits,

quality assurance methods and administration; and the necessary legal

authority to issue waivers, set and adjust costs limits and carry out

any other functions necessary to administer the waiver system.

Section 51.360(a)(5) states that in order for an owner to receive a

waiver, repairs on vehicles newer than 1980 models must be performed by

recognized repair technicians. Repairs by non-technicians can be

applied toward the waiver limit only if the vehicle was manufactured

prior to 1980. Under the Minnesota I/M program, repairs by non-

technicians can be applied towards the waiver limit for any vehicle

subject to the I/M program (i.e. 1976 model year and newer). The USEPA

has advised MPCA that the Statute and Rules must be amended to only

allow repairs by non-technicians for vehicles manufactured between 1976

and 1979 to be applied towards the waiver limit. In the July 5, 1994

letter from Charles Williams, Commissioner, MPCA commits to taking the

necessary actions to amend the Statute and Rules so that they are

consistent with the I/M final rule. USEPA proposes to conditionally

approve the SIP based on this commitment. MPCA must submit these

amendments as a SIP revision within one year of final conditional

approval.

Section 51.360(a)(6) establishes the minimum repair expenditure

that vehicle owners must incur in order to qualify for a waiver under

basic I/M programs. In basic I/M programs, owners must expend a minimum

of $75 for pre-1981 vehicles and $200 for 1981 and later vehicles.

Minnesota statute 116.62 Subdivision 5(c) establishes expenditure

limits of $75 for pre-1981 vehicles and $200 for 1981 and later

vehicles, but imposes no requirement for a minimum repair expense to

qualify for a waiver. The USEPA has advised the State that the

statutory minimum expenditure limits must be amended so that they are

consistent with the final Federal regulations and vehicle owners are

required to present proof of repair expenditures before a waiver can be

granted. In a letter to Regional Administrator Adamkus, the MPCA

commits to take the necessary action to amend the State's statutes and

rules for waivers so that they are consistent with the I/M final rule.

USEPA proposes to conditionally approve the SIP based on this

commitment. MPCA must submit these amendments as a SIP revision within

one year of final conditional approval.

Section 51.360(a)(9) allows time extensions up to the length of the

inspection cycle to be granted to vehicle owners when repairs are

needed on a vehicle in the case of economic hardship, but the extension

can only be granted one time for a vehicle and the extension must be

tracked and reported by the program.

Minnesota grants temporary extensions, which are valid for only 30

days, under three circumstances: (1) when a vehicle will not be

available for inspection during the 90-day period before registration

expiration; (2) a vehicle has failed the initial inspection and

additional time is needed for repair and reinspection; and (3) the

vehicle registration has been expired for at least 12 months or more.

Although the Federal rule only allows for extensions in cases of

economic hardship, the State has successfully tracked the number of

vehicles issued temporary extensions and those vehicles which have

violated the terms of the extension. Minnesota estimates that between

July 1, 1992 and June 30, 1993, approximately 50,000 vehicle owners

were issued temporary extensions. MPCA estimates that to date,

approximately 10,000 vehicles or less are non-compliant. These 10,000

non-compliant vehicles represent approximately 1 percent of the total

number of vehicles subject to the I/M program requirements. The non-

compliant vehicles are accounted for in the Mobile 5a modeling results

submitted by the State which demonstrates compliance with the basic I/M

performance standard. USEPA therefore believes that the Minnesota I/M

temporary extension provisions are approvable.

Motorist Compliance Enforcement

Under Section 51.361, States that are required to implement basic

I/M Programs are required to ensure compliance with program

requirements through the denial of motor vehicle registration or an

alternative enforcement mechanism if the State can demonstrate that the

alternative is as effective as registration denial. SIP submittals must

include: a description of the enforcement process; a determination of

the current compliance rate that includes an estimate of compliance

loss due to loopholes; legal authority for enforcement; and a

commitment to an enforcement level to be used for modeling purposes and

to be maintained, at a minimum, in practice.

The Minnesota Basic I/M program uses registration denial to ensure

compliance with the vehicle inspection requirements. Section

51.361(c)(2) requires States to include in their submittals a

determination of the current compliance rate that includes an estimate

of compliance losses due to loopholes, counterfeiting, and unregistered

vehicles. The SIP submittal estimates a compliance rate of 97%, which

is computed by dividing the total number of vehicles that were actually

tested by the number of vehicles that should have been tested. The

State does not provide an estimate of the effect of closing the

loopholes that allow vehicles to escape inspection. MPCA believes it's

current compliance rate is sufficient since the State is not required

to achieve 100% compliance. In the SIP submittal, the State commits to

a compliance rate of 97% and a stringency rate of 23%.

Section 51.361(a)(5) requires States to structure a penalty system

to deter non-compliance with the registration requirement through the

use of mandatory, minimum fines (meaning civil and monetary penalties)

and through a requirement that vehicle owners demonstrate compliance

before a case can be closed.

Minnesota's basic I/M program allows the owner of a vehicle that

has failed inspection to make the repairs necessary for the vehicle to

pass reinspection. Vehicle owners are allowed two reinspections. If a

vehicle does not pass the reinspections, then the owner can apply for

compliance waiver. If a vehicle does not pass reinspection and does not

qualify for a waiver, the owner is issued a report indicating

noncompliance. Minnesota's penalty for noncompliance is the denial of

vehicle registration. If a vehicle's registration is denied, then the

owner is subject to receiving a citation from local, county or State

law enforcement officials which averages $35.00. For as long as a

vehicle owner continues to operate a vehicle that has not been properly

registered, the owner will receive multiple fines.

Motorists Compliance Enforcement Program Oversight

Under Section 51.362, I/M SIP submittals are to include a

description of enforcement program oversight and information management

activities. The enforcement program must be audited regularly and

follow effective program management practices. Minnesota's Basic I/M

program includes several oversight activities which include:

verification of exempt vehicle status; fines against testing stations

for missing or unaccounted for documents; and methods for evaluating

program effectiveness.

Quality Assurance

Section 51.363 requires States to operate on-going quality

assurance programs aimed at discovering, correcting, and preventing

fraud, waste and abuse. The quality assurance officer should also

assess whether correct operating procedures are being followed and that

testing equipment provides accurate measurements. SIP submittals must

include a description of the quality assurance program, written

procedures manuals covering covert and overt audits, records audits,

and equipment audits.

Section 51.363(a)(2) requires States to audit more frequently

stations that employ inspectors suspected of violating regulations as a

result of audits, data analysis, or consumer complaints. Section

51.363(a)(4) sets forth the criteria that covert audits must satisfy.

Between July 1, 1992 and June 30, 1993, MPCA conducted a total of 24

covert audits.

The USEPA has advised MPCA that, although the State does conduct

covert audits as part of its quality assurance activities, the I/M

program has not established an ongoing consistent audit program that

meets the criteria of Section 51.363(a)(4). In the July 5, 1994, letter

to USEPA, from Charles Williams, Commissioner, the MPCA has committed

to implementing a covert audit schedule and an audit program that meets

the requirements of Section 51.363 and includes the following actions:

(1) Continued annual remote visual observations by the auditor of

inspector performance at each of the eleven inspection stations and,

recording of these observations.

(2) Implementation of a covert audit schedule where a minimum of

two covert audits will be conducted annually at each of the eleven

inspection stations. The MPCA anticipates conducting an average of two

covert audits a month.

(3) Audits will be conducted using covert vehicles that are set to

fail.

(4) Vehicles used in covert audits will cover a full range of

vehicle technology groups and malfunctions.

(5) Auditors will record the covert audit and provide sufficient

written documentation for building a legal case and conducting on going

performance evaluations.

The contractor will continue to run ``altered'' vehicles through

the network of inspection stations to audit test procedures. A schedule

for these audits will be developed and implemented and, written reports

of the audits will be submitted to MPCA as required. USEPA proposes to

conditionally approve the SIP based on this commitment. MPCA must

submit these amendments as a SIP revision within one year of final

conditional approval.

Enforcement Against Contractors, Stations & Inspectors

Section 51.364 requires I/M programs to include enforcement

mechanisms that allow for the imposition of penalties against licensed

stations, contractors or inspectors that violate program requirements.

SIP submittals must describe the legal authority for imposing

penalties, civil fines, license suspension, and revocations.

Section 51.364(a)(1) requires States to develop a penalty schedule

that establishes minimum penalties for violations of program rules and

procedures. The penalty schedule should categorize and list violations

and the minimum penalties to be imposed for violations. States that

have contracted systems, may use compensation retainage in lieu of

penalties.

Section 51.364(a)(3) states that findings of serious violations of

rules or procedural requirements shall result in mandatory fines or

retainage. In the case of gross neglect, a first offense shall result

in a fine or retainage of no less than $100 or 5 times the inspection

fee, whichever is greater, for the contractor or the licensed station

and inspector, if involved.

The Minnesota I/M program uses compensation retainage for assessing

penalties against the contractor when the MPCA determines that the

contractor has not complied with the requirements of the MPCA contract

agreement. The amount of compensation retained is determined at the

discretion of MPCA. Where retainage does not adequately address the

severity of noncompliance, the MPCA may also avail itself of other

remedies.

Each month, the contractor submits to the MPCA an invoice for

payment based on the number of vehicles tested. MPCA staff reviews the

invoice for accuracy, retains 10% and pays the contractor the remaining

90%. The 10% retainage is accumulated monthly and released to the

contractor at the end of each quarter provided the MPCA is satisfied

with the contractors performance. When judging performance, the MPCA

pays particular attention to the requirements of public convenience,

proper calibration of instruments, excessive wait times, facility and

lane down time, and submittal of complete reports in the time

specified. MPCA retains an average of $100,000 per month. Therefore,

the State believes that it is meeting the retainage requirement of $100

or 5 times the inspection fee as specified in Section 51.364.

Section 51.364(b) states that quality assurance officers shall have

the authority to temporarily suspend station and inspector licenses or

certificates (after approval of a superior) immediately upon finding a

violation or equipment failure that directly affects emission reduction

benefits, pending a hearing when requested.

As explained in the SIP submittal, MPCA quality assurance officers

do not have direct authority to impose disciplinary action against

inspectors employed by the contractor since inspectors are not directly

employed by MPCA. Any disciplinary action to be taken is carried out

through the contractor's internal disciplinary procedures. However,

MPCA quality assurance officers may recommend disciplinary action or

discharge of an employee of the contractor. In the event that improper

performance is observed or reported, the quality assurance officer may

recommend disciplinary action to MPCA's Program Manager. Disciplinary

action against inspectors include verbal warnings, written reprimands

or revocation of the Certification of Training, which can result in re-

training and, if necessary, immediate discharge.

Situations requiring disciplinary action have been isolated

incidents and, since initial notification to the MPCA of such

incidents, no subsequent similar incidents have been recorded.

MPCA has committed to implementing a formal process to certify lane

inspectors are qualified and authorized to test vehicles. Lane

inspectors will be required to complete the existing Training Program

outlined in Appendix 14 of the submittal and demonstrate competence in

vehicle testing by receiving at least an 80% passing grade on the

written and practical examinations. Upon successful completion of the

Training Program, lane inspectors will be issued by the MPCA and the

contractor, a certificate of training which certifies that the lane

inspector is qualified and authorized to test vehicles. A Certificate

of Training will be valid for two years, at which time the inspector is

required to repeat the Training Program. No lane inspector will be

authorized to test vehicles without a valid Certificate of Training. A

lane inspector must retain a valid Certificate as a condition of

employment as a lane inspector by the contractor. MPCA has committed to

entering into a Contract Compliance Order with the contractor to

reflect these certification requirements for lane inspectors. USEPA

proposes to conditionally approve the SIP based on this commitment.

MPCA must submit these amendments as a SIP revision within one year of

final conditional approval.

Data Collection

Section 51.365 outlines the test data and quality control data that

must be collected for the management, evaluation, and enforcement of an

I/M program. I/M programs must gather test data on individual vehicles,

as well as quality control data on test equipment. The Minnesota I/M

program contains data gathering provisions that meet all of the

criteria of the Checklist.

Data Analysis and Reporting

SIP submittals are to include information on how States will

incorporate data analysis and reporting into their I/M programs.

Reports should provide information regarding the types of program

activities performed and their final outcomes, including summary

statistics and effectiveness evaluations of the enforcement mechanism,,

the quality assurance system, the quality control program, and the

testing element. The Minnesota I/M SIP submittal describes data

analysis and reporting activities that completely satisfy the criteria

of the Checklist.

Inspector Training & Licensing or Certification

All inspectors partaking in I/M programs must receive formal

training and be licensed or certified to perform inspections. SIP

submittals must include a description of the training program, the

written and practical examinations and the licensing or certification

process.

Lane inspectors are employed and trained by the contractor.

Appendix 14 describes the contractor's training program. MPCA has

committed to issuing a Contract Compliance Order to the contractor

requiring inspectors to complete the contractor training and

demonstrate competence by receiving an 80% or better grade on an

examination. The certificates will expire after two years at which time

inspectors must repeat the training program. USEPA proposes to

conditionally approve the SIP based on this commitment. MPCA must

submit these amendments as a SIP revision within one year of final

conditional approval.

Public Information and Consumer Protection

SIP submittals must include a plan for informing the public on an

ongoing basis, throughout the life of the I/M program, of the air

quality program, the requirements of Federal and State law, the role of

motor vehicles, in the air quality problem, the need for benefits of an

inspection program. In addition, the submittal must describe procedures

and mechanisms to protect the public from fraud and abuse by

inspectors, mechanics, and others involved in the I/M program.

The Minnesota I/M program has included public information and

consumer protection provisions since its inception in 1991. Appendix 25

contains MPCA's most current Public Information Plan and Appendix 26

includes all of the fact sheets, brochures, an annual report, quarterly

newsletter, a media relations kit and other I/M program publications.

Improving Repair Effectiveness

Basic I/M SIP submittals must include a description of the State's

technical assistance program and a description of the repair technician

training resources available to the community. The technical assistance

program must provide the repair industry with information and

assistance related to vehicle inspection, diagnosis, and repair.

The Minnesota I/M program offers assistance to repair technicians

through the Consumer Advocate program and the MPCA currently publishes

a quarterly newsletter that serves as the main communication link

between the repair industry and the MPCA. Appendix 21 contains the

repair technician curriculum used by vocational/technical colleges,

community colleges or post-secondary programs to train automotive

repair technicians.

Section 51.372 lists each of the elements that must be included in

SIP submittals. The Minnesota submittal addresses each of the elements

listed in the Section.

Implementation Deadlines

States implementing decentralized basic programs must have such

programs fully operable by January 1, 1994. The Minnesota I/M program

has been fully implemented since 1991.

IV. USEPA Comments

The USEPA has identified additional deficiencies in the I/M

submittal that the MPCA must adequately address before the USEPA can

proceed with final approval. The deficiencies are presented in the

following comments. If MPCA adequately addresses the deficiencies

during the 30-day comment period, USEPA will proceed with final

conditional approval of the I/M SIP submittal. In the event that the

State does not adequately address the deficiencies outlined below, the

USEPA will take final action to disapprove the basic I/M SIP submittal.

(1) Minnesota Rules 7023.1020 has been amended such that visual

inspection of fuel inlet restrictors is no longer required. Therefore,

the emission reductions obtained in the proposed program must be less

than or equal to those obtained by the existing program. Since visual

inspection for fuel inlet restrictors was previously required, there

must be comparable improvement to the program if this element is to be

removed. There is no evidence that the program has been strengthened.

The State should either reinstate the fuel inlet restrictor requirement

or make other improvements to the testing program so that the

reductions are as good or better than under the existing program.

(2) USEPA has identified two issues regarding the compliance rate

claimed by the State in the submittal. First, the submittal provides

conflicting estimates of the number of unregistered vehicles in the

Twin Cities metropolitan area. The contractor estimates that 22,000

vehicles in the area are registered without undergoing testing, while

MPCA estimates that only 12,000 vehicles are registered without

undergoing testing. The conflicting estimates undermine the reliability

of the 97% compliance rate arrived at by the State. Secondly, the State

uses a 96% compliance rate in the Mobile 5a modeling inputs, yet claims

a 97% compliance rate in the submittal. USEPA can accept the 96%

compliance rate without any further information or action on the

State's part. If the State chooses to continue to claim the 97%

compliance rate, it must supply USEPA with an estimate of the number of

unregistered vehicles and a description of mechanisms the state will

employ to identify and encourage registration of unregistered vehicles.

(3) The USEPA is concerned that the $35.00 citation imposed on

vehicle owners who fail to undergo testing and properly register their

vehicles is not sufficiently high to deter non-compliance. The USEPA

requests that MPCA provide further information on the maximum fine

imposed on vehicle owners that fail to undergo testing.

(4) The USEPA believes that Minnesota's lack of a defined penalty

schedule for cases of serious violations of the State's contractual

agreement significantly lessens the stringency of the State's

enforcement efforts. In addition, the State has not provided any

description of its mechanisms for permanent fee retainage from the

contractor. The MPCA must provide USEPA with a schedule of typical

retainage for serious violations of the contractual agreement.

(5) The submittal indicates that quality assurance officers do not

have direct authority to impose disciplinary action against inspectors

employed by the contractor. MPCA quality assurance officers may only

recommend disciplinary action or discharge of an employee. MPCA must

commit to requiring the contractor to act upon the State's

recommendation for disciplinary action.

V. Proposed Action

The USEPA is proposing conditional approval of the Minnesota basic

I/M SIP revision request for CO. Section 110(k)(4) of the Clean Air Act

allows USEPA to conditionally approve a plan based on a commitment from

the State to adopt and submit specific enforceable measures within one

year from the date of approval. USEPA's conditional approval of

Minnesota's basic I/M program is based upon MPCA's commitment to adopt

specific enforceable measures as outlined in the July 5, 1994, letter

from Charles Williams, Commissioner MPCA, to Valdas Adamkus, Regional

Administrator, USEPA. If Minnesota fails to implement the necessary

changes within the one year period following the date of approval, the

approval will automatically convert to a disapproval of the SIP.

Automatic disapproval of the SIP will trigger the 18-month sanctions

period of Section 179 of the CAA. In addition, USEPA can elect to

exercise its discretionary authority to impose sanctions prior to the

end of the 18-month period. Finally, disapproval will trigger a 24

month Federal Implementation Plan (FIP) clock under Section 110(c) of

the CAA. MPCA must also adequately address the deficiencies outlined in

the section entitled ``USEPA Comments'' during the 30-day comment

period. If MPCA adequately addresses the comments, USEPA will proceed

with final conditional approval of the I/M SIP submittal. In the event

that the State does not adequately address the deficiencies, the USEPA

proposes in the alternative to take final action to disapprove the

basic I/M SIP submittal.

Public comments are solicited on the requested SIP revision and on

USEPA's proposal to conditionally approve. Public comments received by

September 6, 1994 will be considered in the development of USEPA's

final rulemaking action.

Nothing in this action should be construed as permitting, allowing

or establishing a precedent for any future request for revision to any

SIP. USEPA shall consider each request for revision to the SIP in light

of specific technical, economic, and environmental factors, and in

relation to relevant statutory and regulatory requirements.

This action has been classified as a Table 2 action by the Regional

Administrator under the procedures published in the Federal Register on

January 19, 1989 (54 FR 2214-2225). A revision to the SIP processing

review tables was approved by the Acting Administrator for the Office

of Air and Radiation on October 4, 1993 (Michael Shapiro's memorandum

to Regional Administrators.) A future notice will inform the general

public of these tables. Under the revised tables, this action remains

classified as Table 2.

On January 6, 1989, the Office of Management and Budget (OMB)

waived Table 2 and 3 SIP revisions (54 FR 2222) from the requirements

of section 3 of Executive Order 12291 for a period of 2 years. The

USEPA has submitted a request for permanent waiver for Table 2 and 3

SIP revisions. The OMB has agreed to continue the temporary waiver

until such time as it rules on USEPA's request. This request remains in

effect under Executive Order 12866 which superseded Executive Order

12291 on September 30, 1993.

Executive Order 12866

Under Executive Order 12866 [58 FR 51735 (October 4, 1993)] the

Agency must determine whether the regulatory action is ``significant''

and therefore subject to OMB review and the requirements of the

Executive Order. The Order defines ``significant regulatory action'' as

one that is likely to result in a rule that may:

(1) have an annual effect on the economy of $100 million or more or

adversely affect in a material way the economy, a sector of the

economy, productivity, competition, jobs, the environment, public

health or safety, or State, local, or tribal governments or

communities;

(2) Create a serious inconsistency or otherwise interfere with an

action taken or planned by another agency;

(3) Materially alter the budgetary impact of entitlements, grants,

user fees, or loan programs or the rights and obligations of recipients

thereof; of

(4) Raise novel legal or policy issues arising out of legal

mandates, the President's priorities, or the principles set forth in

the Executive Order. The OMB has exempted this regulatory action from

E.O. 12866 review.

Under the Regulatory Flexibility Act, 5 U.S.C. Section 600 et seq.,

USEPA must prepare a regulatory flexibility analysis assessing the

impact of any proposed or final rule on small entities. (5 U.S.C. 603

and 604.) Alternatively, USEPA may certify that the rule will not have

a significant impact on a substantial number of small entities. Small

entities include small businesses, small not-for-profit enterprises,

and government entities with jurisdiction over populations of less than

50,000.

Potential conversion of the conditional approval to disapproval

under section 110 and subchapter I, Part D of the CAA does not affect

any existing requirements applicable to small entities. Any pre-

existing Federal requirements remain in place after this disapproval.

Federal disapproval of the State submittal does not affects its state-

enforceability. Moreover, USEPA's disapproval of the submittal does not

impose any new Federal requirements. Therefore, USEPA certifies that

this action or the conversion of this action into a disapproval action

would not have a significant impact on a substantial number of small

entities because it would not remove existing requirements nor impose

any new Federal requirements.

List of Subjects in 40 CFR Part 52

Environmental protection, Air Pollution control, Carbon monoxide,

Intergovernmental relations, Reporting and recordkeeping requirements.

Authority: 42 U.S.C. 7401-7671(q).

Dated: July 15, 1994.

Valdas V. Adamkus,

Regional Administrator.

[FR Doc. 94-19183 Filed 8-4-94; 8:45 am]

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