Approval and Promulgation of Implementation Plans; Ohio

ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[OH53-1-6092; FRL-4844-4]

Approval and Promulgation of Implementation Plans; Ohio

AGENCY: U.S. Environmental Protection Agency (USEPA).

ACTION: Proposed rule.

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SUMMARY: On August 20, 1993, the Ohio Environmental Protection Agency

(OEPA) submitted materials in response to requirements in part D of

title I of the Clean Air Act for new source review in nonattainment

areas. This submittal included no revisions to any Ohio regulations.

Instead, the submittal described how Ohio intended to implement various

applicable part D requirements, and presented a rationale that no

revisions to State regulations would be necessary to satisfy these

requirements. USEPA disagrees with this rationale and proposes to

disapprove the State's submittal for failure to satisfy applicable

requirements.

DATES: Comments on this proposed action must be received by April 4,

1994.

ADDRESSES: Comments should be submitted to William L. MacDowell at the

Region 5 address. Copies of the State's submittals, the public comment

letter, and USEPA's technical support document of November 9, 1993, are

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

that you telephone John Summerhays at (312) 886-6067, before visiting

the Region 5 Office.)

U.S. Environmental Protection Agency, Region 5, Air and Radiation

Division (AE-17J), 77 West Jackson Boulevard, Chicago, Illinois 60604.

FOR FURTHER INFORMATION CONTACT: John Summerhays, Regulation

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

Environmental Protection Agency, Region 5, Chicago, Illinois 60604,

(312) 886-6067.

SUPPLEMENTARY INFORMATION:

I. Background

On August 20, 1993, the Ohio Environmental Protection Agency (OEPA)

submitted a letter with attachments to the United States Environmental

Protection Agency (USEPA) addressing new source review in nonattainment

areas. USEPA notified OEPA on October 22, 1993, that it found this

submittal complete. This submittal was intended to satisfy Clean Air

Act requirements for new source review in nonattainment areas,

particularly the new requirements established by the Clean Air Act

Amendments of 1990.

Provisions for new source review in Ohio were included in the

original State Implementation Plan (SIP) submitted on January 31, 1972,

and replacement regulations submitted on June 6, 1973. The relevant

regulations provided for best available control technology (BACT) and

other requirements applied uniformly throughout the State.

Subsequently, the Clean Air Act Amendments of 1977 provided for

designations of areas as being in attainment or nonattainment of the

air quality standards, and required a further State submittal to impose

additional requirements (most notably lowest achievable emission rates

(LAER) and offsets) for new sources in nonattainment areas. Ohio

submitted relevant material on July 25, 1980, and September 25, 1980.

USEPA conditionally approved these submittals on October 31, 1980, on

the condition that Ohio submit regulations delineating requirements

that new sources in nonattainment areas must meet.

Ohio submitted revised regulations on October 4, 1982, and January

24, 1983. These regulations impose nonattainment area new source

permitting requirements by incorporating appendix S to title 40 of the

Code of Federal Regulations, part 51 (appendix S to 40 CFR part 51--

''Emission Offset Interpretative Ruling'') into the State regulations.

USEPA granted limited approval to this submittal on September 8, 1993

(58 FR 47211), concluding that the regulation strengthened the SIP but

did not fully satisfy the nonattainment area planning requirements

established in 1977 in part D of title I of the Clean Air Act. Of

particular concern were the exemptions of temporary sources and

resource recovery facilities provided in appendix S (and thus

incorporated by reference in the State rules) but not approvable under

the criteria established in 40 CFR part 51, subpart I. By the time of

this 1993 rulemaking, the Clean Air Act Amendments of 1990 had imposed

further requirements for nonattainment area new source review. The

State provided USEPA material concerning the new requirements on

November 19, 1992, December 2, 1992, January 13, 1993, and April 26,

1993. USEPA notified the State on June 1, 1993, that these materials

did not represent a complete submittal. The State then provided

additional information on August 20, 1993, which USEPA found on October

22, 1993, to constitute a complete submittal. USEPA has conducted a

full review and proposes to disapprove the submittal for failing to

satisfy the current nonattainment area new source review requirements

of part D of title I of the Clean Air Act.

The Clean Air Act Amendments of 1990 established numerous new

requirements for new source review. Among the more significant of these

requirements that apply to Ohio are provisions for specific emission

offset requirements in ozone nonattainment areas, including specified

minimum offset rations, for review of major new sources and major

modifications for nitrogen oxides (NOx) in ozone nonattainment

areas, and for an alternative siting analysis for all nonattainment

area pollutants. Additionally, the State plan must include provisions

for proper calculation of offsets, provisions reflecting certain

substantial restrictions on growth allowances, provisions for supplying

from nonattainment new source review permits to USEPA's RACT/BACT/LAER

Clearinghouse, provisions relating to rocket engines or motors,

provisions relating to stripper wells, provisions relating to the

definition of ``stationary source'' affecting the treatment of internal

combustion engine sources, and provisions relating to temporary clean

coal technology demonstration projects.1

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\1\The amended Act also requires that new source review

requirements apply to lower size sources in areas classified Serious

or above, and in some cases requires new source review for

particulate matter precursor sources in particulate matter

nonattainment areas. However, Ohio presently has no areas classified

Serious or above, and the requirement relating to particulate matter

precursors will not apply if USEPA finalizes a determination

proposed on August 3, 1993, that precursors do not contribute

significantly to particulate matter violations.

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The 1990 Amendments also specify various deadlines for submittal of

SIP revisions to satisfy these requirements. For areas designated

nonattainment for fine particulate matter, a plan satisfying the

requirements of sections 173 and 189 was to be submitted by June 30,

1992. For areas designated nonattainment and classified as marginal or

above for ozone, a plan satisfying the requirements of sections 173 and

182 was to be submitted by November 15, 1992. For areas designated

nonattainment for carbon monoxide, a plan satisfying the requirements

of section 173 was to be submitted by November 15, 1993. The State of

Ohio has areas designated nonattainment for ozone and particulate

matter, for which it was required to meet these SIP revision deadlines.

The August 20, 1993, material was submitted in an effort to satisfy

these requirements.

II. Review of State's Submittal

A. Review Relative to Pre-1990 Requirements

The State's recent submittal does not address new source review

requirements that applied prior to the Clean Air Act Amendments of

1990. Therefore, the USEPA review of the State's plan relative to pre-

1990 requirements published on September 8, 1993 (58 FR 47211), remains

current. The September 8 notice granted limited approval on the basis

of the strengthening effect of the 1982 regulations relative to the

prior SIP, but found the State's plan to be insufficient to meet the

pre-1990 new source review requirements. The 1982 regulations

essentially incorporate appendix S of 40 CFR part 51 by reference.

USEPA identified deficiencies relating to the exemptions from offset

requirements for resource recovery facilities and temporary sources

provided in appendix S and therefore incorporated by reference into

Ohio's regulations. Since these deficiencies have not been addressed,

the State's new source review program continues to fail to satisfy part

D requirements.

The September 8 notice also noted that the provisions of appendix

S, as incorporated by reference into Ohio's regulations, are not as

explicit as the current requirements of subpart I of 40 CFR part 51 for

annual, actual emissions offsets. Although USEPA interprets Ohio's

regulations to require that federally enforceable actual emission

offsets be obtained as a condition of any permit pursuant to part D,

section 173(c) requires that Ohio clarify that this requirement

applies.

B. Review Relative to Post-1990 Requirements

The substance of Ohio's submittal of August 20, 1993, is a document

entitled ``Ohio EPA New Source Review State Implementation Plan--

Requirements for Major New Sources in Nonattainment Areas.'' This

document focuses on requirements established by the Clean Air Act

Amendments of 1990 and identifies OEPA's plans for implementing these

requirements. This document is referred to below as Ohio's statement of

permitting criteria.

The State's submittal provides no new regulations to govern review

of new sources in nonattainment areas. Instead, the submittal states

that regulations adopted in 1974 provide the necessary authority to

implement the new requirements for new source review, and that these

SIP approved regulations in conjunction with the submittal's statement

of permitting criteria should satisfy Clean Air Act requirements. Thus,

a key question in this rulemaking is whether USEPA can approve this

approach and enforce the intended permitting requirements.

The USEPA, in its technical support document, evaluated the

adequacy with which Ohio's submittal satisfies selected key

requirements. USEPA's review indicated that the statement of permitting

criteria does not provide adequate specificity and clarity of criteria

by which detailed implementation decisions would be made. The following

discussion of sample requirements illustrates the basis for this

conclusion.

The Clean Air Act Amendments of 1990 require that specified offset

ratios for volatile organic compounds (VOC) emissions and presumptively

for nitrogen oxides (NOx) emissions must be obtained in ozone

nonattainment areas. That is, any significant increase in potential

emissions for either of these pollutants must be accompanied by an

decrease in actual emissions that is larger by at least a specified

ratio. Ohio's statement of permitting criteria includes: (1) A

preliminary clause stating that ``the following additional requirements

will be applicable,'' (2) an item 1 identifying ``minimum required

offset ratios,'' and (3) an item 4 noting that ``NOx . . . shall

be treated as a nonattainment pollutant'' in ozone nonattainment areas.

No definition of offset ratio is provided, and so it is unclear what

averaging time applies, whether offsets are to reflect allowable or

actual emissions, whether all emission increases must be offset (e.g.,

fugitive and secondary emissions), where the offsets must occur, and

whether interpollutant offsets are permissible. (Item 4 of Ohio's

statement implies that NOx offsets must come from the same county

as the emission increases.) The statement also does not explicitly

state that either VOC or NOx offsets are required.

A second new requirement is that the other various major source

requirements (e.g., lowest achievable emission rates) also apply to

major sources of NOx in ozone nonattainment areas, unless USEPA

makes certain determinations that NOx control would not be

beneficial. Ohio implies the applicability of these requirements by

making the above statement that NOx is to be treated as a

nonattainment pollutant. Ohio's statement continues that ``[n]ew source

applicants are required to meet the major new source definitions and

major modifications thresholds as specified in the CAA.'' However, the

Clean Air Act itself does not explicitly define ``major new source''

and does not specify major modification thresholds. Also, Ohio's

statement could be read to require all sources to meet the size

minimums for major new sources or major modifications. Ohio's statement

continues: ``For major modifications, these CAA requirements will be

applicable to sources of NOx greater than 40 tons per year.'' It

is not clear whether Ohio intends this apparent reduction from 100 to

40 tons per year of the threshold of source sizes at which major

modifications trigger new source review requirements.

Review of further requirements established by the 1990 Amendments

is provided in the technical support document. The conclusion of

USEPA's review is that the statement of permitting criteria does not

address many of the questions that would arise in imposing the

identified requirements.

C. Analysis of the Need for Regulations

The above examples clarify a central issue in this rulemaking, i.e.

whether formal regulations are necessary to establish the requirements

dictated by the Clean Air Act. Ohio's statement and the submittal cover

letter present the State's position that existing Ohio statutes and

regulations already require that the provisions of the amended Clean

Air Act be met. Specifically, Ohio notes that its Rule 3745-31-05

requires that permits to install shall be issued only if the

construction and operation will ``not result in a violation of any

applicable laws,'' which is defined to include the Clean Air Act

including any amendments. Although Ohio proceeds to describe in general

terms how it intends to apply the new requirements, the submittal cover

letter expressly states that ``the current, federally approved, Ohio

SIP is adequate for fulfilling the requirements of a NSR SIP, and that

no changes are necessary.''

Ohio's position raises fundamental questions about the role of

implementing regulations. In general, statutes present general criteria

that must be met, whereas regulations define the specific requirements

that apply in each circumstance. In limited circumstances a statute may

be enforced without implementing regulations, but generally regulations

are necessary to define the precise obligations of affected individuals

and the precise criteria by which relevant decisions (e.g.

determinations of compliance) will be made. The proper adoption of

clearly defined criteria for making relevant decisions is essential to

support these decisions. Therefore, in the absence of exhaustively

detailed statutes, the adoption of detailed regulations is essential

for successful program implementation.

In the case of new source review, the Clean Air Act identifies

general provisions which are to be included in State plans. The State's

statement of permitting criteria closely parallels the language in the

Clean Air Act. As the above examples illustrate, Ohio's submittal fails

to define many of the details of how these requirements would be

implemented. In the absence of these details, a subject source could

not be expected to know its obligations pursuant to these requirements,

and could object to the imposition of the general requirements based on

the failure of the State to pre-define the specific criteria that would

be applied. Further, as a commenter noted when the State proposed its

SIP revision, the statement of permitting criteria was not adopted

according to the full procedures in Ohio for adoption of regulations,

even though this statement is intended to serve purposes normally

served by regulations. Consequently, the statement of permitting

criteria lacks the specificity, the regulatory standing, and the

assurance of being enforceable that are needed to satisfy Clean Air Act

requirements.

III. This Action

USEPA's review indicates that Ohio's submittal does not clearly

establish the specific criteria by which judgments in new source

permitting will be made. Furthermore, by relying not on properly

adopted regulations but rather on a general regulatory provision

(requiring compliance with the Clean Air Act) in conjunction with a

statement of permitting criteria, the State has failed to follow proper

procedures to become authorized to impose specific, detailed permit

conditions in accordance with the Clean Air Act requirements. In

addition, the existing regulations exempt two types of sources which

may not be exempted under applicable USEPA regulations. For these

reasons, USEPA proposes to disapprove Ohio's submittal for failure to

satisfy part D requirements.

Under section 179(a)(2), if USEPA takes final action to disapprove

a submission under section 110(k) for an area designated nonattainment

based on the submission's failure to meet one or more of the elements

required by the Act, USEPA must apply one of the sanctions set forth in

section 179(b) unless the deficiency has been corrected within 18

months of such disapproval. Section 179(b) provides two sanctions

available to USEPA: highway funding restrictions, and a requirement for

two-for-one offsets. The 18-month period referred to in section 179(a)

would begin to run at the time USEPA publishes final notice of this

disapproval. Moreover, the final disapproval would trigger the Federal

Implementation Plan (FIP) requirement under section 110(c). Separate

rulemaking is being conducted to identify which sanction would apply

first and to address related issues on the application of sanctions,

for example whether USEPA must publish final approval of a new

submittal before the deficiency may be considered corrected.

Public comment is solicited on this proposed rulemaking action.

Comments received by [Insert date 30 days from date of publication]

will be considered in the development of USEPA's final rulemaking

action.

Under the Regulatory Flexibility Act, 5 U.S.C. 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.

USEPA's disapproval of the State request under section 110 and part

D of the Clean Air Act does not affect any existing requirements

applicable to small entities. Any pre-existing Federal requirements

remain in place after this disapproval. Federal disapproval of the

State submittal does not affect its State enforceability. Moreover,

USEPA's disapproval of the submittal does not impose any new Federal

requirements. Therefore, USEPA certifies that this disapproval action

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

entities because it does not remove existing requirements nor does it

impose any new Federal requirements.

This action has been classified as a Table Two action by the

Regional Administrator under the procedures published in the Federal

Register on January 19, 1989 (54 FR 2214-2225), based on revised SIP

processing review tables approved by the Acting Assistant Administrator

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

to Regional Administrators). On January 6, 1989, the Office of

Management and Budget waived Tables Two and Three SIP revisions (54 FR

222) from the requirements of section 3 of Executive Order 12291 for a

period of 2 years. USEPA has submitted a request for a permanent waiver

for Table 2 and Table 3 SIP revisions. OMB has agreed to continue the

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

continued in effect under Executive Order 12866, which superseded

Executive Order 12291 on September 30, 1993.

List of Subjects in 40 CFR Part 52

Environmental protection, Air pollution control, Carbon monoxide,

Hydrocarbons, Intergovernmental relations, Nitrogen oxides, Ozone,

Particulate matter, Reporting and recordkeeping requirements, Sulfur

dioxide.

Authority: 7401-7671q.

Dated: February 14, 1994.

David Ullrich,

Acting Regional Administrator.

[FR Doc. 94-4992 Filed 3-3-94; 8:45 am]

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