Clean Air Act Proposed Interim Approval of the Operating Permits Program; Proposed Approval of State Implementation Plan Revision for the Issuance of Federally Enforceable State Operating Permits; Mojave Desert Air Quality Management District, California

ENVIRONMENTAL PROTECTION AGENCY

40 CFR Parts 52 and 70

[CA 147-2-7073; AD-FRL-5253-2]

Clean Air Act Proposed Interim Approval of the Operating Permits

Program; Proposed Approval of State Implementation Plan Revision for

the Issuance of Federally Enforceable State Operating Permits; Mojave

Desert Air Quality Management District, California

AGENCY: Environmental Protection Agency (EPA).

ACTION: Proposed rule.

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SUMMARY: The EPA proposes interim approval of the title V operating

permits program submitted by the Mojave Desert Air Quality Management

District (Mojave Desert, or District) for the purpose of complying with

federal requirements that mandate that states develop, and submit to

EPA, programs for issuing operating permits to all major stationary

sources and to certain other sources. There are nine deficiencies in

Mojave Desert's program, as specified in the Technical Support Document

and outlined below, that must be corrected before the program can be

fully approved. EPA is also proposing to approve a revision to Mojave

Desert's portion of the California State Implementation Plan (SIP)

regarding synthetic minor regulations for the issuance of federally

enforceable state operating permits (FESOP). In order to extend the

federal enforceability of state operating permits to hazardous air

pollutants (HAP), EPA

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is also proposing approval of Mojave Desert's synthetic minor

regulations pursuant to section 112 of the Act. Today's action also

proposes approval of Mojave Desert's mechanism for receiving straight

delegation of section 112 standards.

DATES: Comments on these proposed actions must be received in writing

by August 2, 1995.

ADDRESSES: Comments should be addressed to Sara Bartholomew, Mail Code

A-5-2, U.S. Environmental Protection Agency, Region IX, Air & Toxics

Division, 75 Hawthorne Street, San Francisco, CA 94105.

Copies of the District's submittal and other supporting information

used in developing the proposed interim approval are available for

inspection during normal business hours at the following location: U.S.

Environmental Protection Agency, Region IX, 75 Hawthorne Street, San

Francisco, CA 94105.

FOR FURTHER INFORMATION CONTACT: Sara Bartholomew (telephone 415/744-

1170), Mail Code A-5-2, U.S. Environmental Protection Agency, Region

IX, Air & Toxics Division, 75 Hawthorne Street, San Francisco, CA

94105.

SUPPLEMENTARY INFORMATION:

I. Background and Purpose

As required under title V of the Clean Air Act (Act) as amended

(1990), EPA has promulgated rules that define the minimum elements of

an approvable state operating permits program and the corresponding

standards and procedures by which the EPA will approve, oversee, and

withdraw approval of state operating permits programs (see 57 FR 32250

(July 21, 1992)). These rules are codified at 40 CFR part 70 (part 70).

Title V requires states to develop, and submit to EPA, programs for

issuing operating permits to all major stationary sources and to

certain other sources.

The Act requires that states develop and submit title V programs to

EPA by November 15, 1993, and that EPA act to approve or disapprove

each program within 1 year after receiving the submittal. The EPA's

program review occurs pursuant to section 502 of the Act and the part

70 regulations, which together outline criteria for approval or

disapproval. Where a program substantially, but not fully, meets the

requirements of part 70, EPA may grant the program interim approval for

a period of up to 2 years. If EPA has not fully approved a program by 2

years after the November 15, 1993 date, or by the end of an interim

program, it must establish and implement a federal program.

On June 28, 1989 (54 FR 27274), EPA published criteria for

approving and incorporating into the SIP regulatory programs for the

issuance of federally enforceable state operating permits. Permits

issued pursuant to an operating permit program meeting these criteria

and approved into the SIP are considered federally enforceable. EPA has

encouraged states to consider developing such programs in conjunction

with title V operating permit programs for the purpose of creating

federally enforceable limits on a source's potential to emit. This

mechanism would enable sources to reduce their potential to emit to

below the title V applicability thresholds and avoid being subject to

title V. (See the guidance document entitled, ``Limitation of Potential

to Emit with Respect to Title V Applicability Thresholds,'' dated

September 18, 1992, from John Calcagni, Director of EPA's Air Quality

Management Division.) On November 3, 1993, EPA announced in a guidance

document entitled, ``Approaches to Creating Federally Enforceable

Emissions Limits,'' signed by John S. Seitz, Director of EPA's Office

of Air Quality Planning and Standards (OAQPS), that this mechanism

could be extended to create federally enforceable limits for emissions

of hazardous air pollutants (HAP) if the program were approved pursuant

to section 112(l) of the Act.

II. Proposed Action and Implications

This document focuses on specific elements of Mojave Desert's title

V operating permits program submittal that must be corrected to meet

the minimum requirements of 40 CFR part 70. The full program submittal,

the Technical Support Document containing a detailed analysis of the

full program, and other relevant materials are available as part of the

public docket.

A. Analysis of State Submission

1. Title V Support Materials

Mojave Desert's title V program was submitted by the California Air

Resources Board (CARB) on November 24, 1993 and found by EPA to be

incomplete, due to the lack of Federal Operating Permit regulations.

Mojave resubmitted its program on March 10, 1995 and it was found to be

complete on May 11, 1995. The Governor's letter requesting source

category-limited interim approval, California enabling legislation, and

Attorney General's legal opinion were submitted by CARB for all

districts in California and therefore were not included separately in

Mojave Desert's submittal. The Mojave Desert submission does contain a

complete program description, District implementing and supporting

regulations, and all other program documentation required by Sec. 70.4.

An implementation agreement between Mojave Desert and EPA is currently

being developed.

2. Title V Operating Permit Regulations and Program Implementation

The Mojave Desert's title V regulations were adopted on December

21, 1994. They consist of Regulation XII (Federal Operating Permits).

The District also submitted supporting materials including the

following rules: Rule 219 (Equipment Not Requiring a Permit, adopted

December 21, 1994), 221 (Federal Operating Permit Requirement, adopted

November 23, 1994), 301 (Permit Fees, adopted July 9, 1976, amended

October 23, 1994), 312 (Fees for Federal Operating Permits, adopted

December 21, 1994), and 430 (Breakdown Provisions, adopted May 7, 1976,

amended December 21, 1994). These regulations ``substantially meet''

the requirements of 40 CFR part 70, Sec. 70.2 and Sec. 70.3 for

applicability; Sec. 70.4, Sec. 70.5, and Sec. 70.6 for permit content,

including operational flexibility; Sec. 70.7 for public participation

and minor permit modifications; Sec. 70.5 for complete application

forms; and Sec. 70.11 for enforcement authority. Although the

regulations substantially meet part 70 requirements, nine program

deficiencies outlined below are interim approval issues. Recommended

changes are detailed further in the Technical Support Document.

Variances--Mojave Desert has authority under State and local law to

issue a variance from State and local requirements. Sections 42350 et

seq. of the California Health and Safety Code and District Regulation

1, sections 431-433 allow the District to grant relief from enforcement

action for permit violations. The EPA regards these provisions as

wholly external to the program submitted for approval under part 70,

and consequently, is proposing to take no action on these provisions of

State and local law.

The EPA has no authority to approve provisions of state or local

law, such as the variance provisions referred to, that are inconsistent

with the Act. The EPA does not recognize the ability of a permitting

authority to grant relief from the duty to comply with a federally

enforceable part 70 permit, except where such relief is granted through

[[Page 34490]]

procedures allowed by part 70. A part 70 permit may be issued or

revised (consistent with part 70 permitting procedures) to incorporate

those terms of a variance that are consistent with applicable

requirements. A part 70 permit may also incorporate, via part 70 permit

issuance or modification procedures, the schedule of compliance set

forth in a variance. However, EPA reserves the right to pursue

enforcement of applicable requirements notwithstanding the existence of

a compliance schedule in a permit to operate. This is consistent with

40 CFR 70.5(c)(8)(iii)(C), which states that a schedule of compliance

``shall be supplemental to, and shall not sanction noncompliance with,

the applicable requirements on which it is based.''

Insignificant Activities--Section 70.4(b)(2) requires states to

include in their part 70 programs any criteria used to determine

insignificant activities or emission levels for the purpose of

determining complete applications. Section 70.5(c) states that an

application for a part 70 permit may not omit information needed to

determine the applicability of, or to impose, any applicable

requirement, or to evaluate appropriate fee amounts. Section 70.5(c)

also states that EPA may approve, as part of a state program, a list of

insignificant activities and emissions levels which need not be

included in permit applications. Under part 70, a state must request

and EPA must approve as part of that state's program any activity or

emission level that the state wishes to consider insignificant. Part

70, however, does not establish appropriate emission levels for

insignificant activities, relying instead on a case-by-case

determination of appropriate levels based on the particular

circumstances of the part 70 program under review.

In Rule 219 (Equipment Not Requiring a Permit) Mojave Desert

provided both threshold emissions levels and a list of specific

equipment which would not require a permit. This rule also clearly

states that equipment need not be listed in a permit application for a

federal operating permit if it falls below the threshold, is on the

list of equipment in the rule, is not subject to an applicable

requirement, and is not included in the equipment list solely due to

size or production rate. The only weakness in these gatekeepers is that

the word ``and'' is missing between sections (B)(1)(b) and (c), and

(B)(1)(c) and (d) of Rule 219. Adding ``and'' in these two places would

clarify that all of the four gatekeepers must apply for equipment to be

exempt, not just one. These corrections must be made in order to

receive full approval.

Rule 219 set the threshold criteria for equipment to be exempt from

a federal operating permit as 10% of the applicable threshold for

determination of a major source, or 5 tons per year of any regulated

air pollutant (whichever is less), and for HAP any de minimus level,

any significance level, or 0.5 tons per year (whichever is less). For

other state and district programs, EPA has proposed to accept, as

sufficient for full approval, emission levels for insignificant

activities of 2 tons per year for criteria pollutants and the lesser of

1000 pounds per year, section 112(g) de minimis levels, or other title

I significant modification levels for HAP and other toxics (40 CFR

52.21(b)(23)(i)). EPA believes that these levels are sufficiently below

the applicability thresholds of many applicable requirements to assure

that no unit potentially subject to an applicable requirement is left

off a title V application.

Mojave Desert did not describe the criteria used to determine the

insignificant activities or emission levels outlined in Rule 219. In

addition, Mojave's threshold levels as described above are higher than

those EPA has proposed to accept. Because of this, EPA is requesting

comment on the appropriateness of these emission levels for determining

insignificant activities in Mojave Desert. This request for comment is

not intended to restrict the ability of other states and districts to

propose, and EPA to approve, different emission levels if the state or

district demonstrates that such alternative emission levels are

insignificant compared to the level of emissions from and types of

units that are permitted or subject to applicable requirements.

3. Title V Permit Fee Demonstration

Section 502(b)(3) of the Act requires that each permitting

authority collect fees sufficient to cover all reasonable direct and

indirect costs required to develop and administer its title V operating

permits program. Each title V program submittal must contain either a

detailed demonstration of fee adequacy or a demonstration that

aggregate fees collected from title V sources meet or exceed $25 per

ton of emissions per year (adjusted from 1989 by the Consumer Price

Index (CPI)). The $25 per ton amount is presumed, for program approval,

to be sufficient to cover all reasonable program costs and is thus

referred to as the ``presumptive minimum.'' See Sec. 70.9(b)(2)(i).

Mojave Desert has opted to make a presumptive minimum fee

demonstration. Mojave Desert's existing fee schedule (Element 7)

requires title V facilities to pay an amount equivalent to $48.76 per

ton in annual operating fees. This amount meets EPA's presumptive

minimum (CPI adjusted). The $48.76 per ton amount is based on a

calculation of 1993/94 fee revenues per ton of emissions plus a

supplemental title V fee of 14.3% that covers the additional costs

posed by title V. Mojave Desert will maintain an accounting system and

is prepared to increase fees, as needed, to reflect actual program

implementation costs.

4. Provisions Implementing the Requirements of Other Titles of the Act

a. Section 112--Mojave Desert has demonstrated in its title V

program submittal adequate legal authority to implement and enforce all

section 112 requirements through the title V permit. This legal

authority is contained in the State of California enabling legislation

and in regulatory provisions defining ``applicable requirements'' and

``federally enforceable'' and mandating that all federal air quality

requirements must be incorporated into permits. EPA has determined that

this legal authority is sufficient to allow Mojave Desert to issue

permits that assure compliance with all section 112 requirements. For

further discussion, please refer to the Technical Support Document

accompanying this action and the April 13, 1993 guidance memorandum

entitled, ``Title V Program Approval Criteria for Section 112

Activities,'' signed by John Seitz.

b. Title IV--Mojave Desert is submitting proposed Rule 1210 (Acid

Rain Provisions of Federal Operating Permits) to its Board in June,

1995, which incorporates the pertinent provisions of part 72, either by

reference or in specific language in the rule. EPA interprets

``pertinent provisions'' to include all provisions necessary for the

permitting of affected sources.

B. Proposal for and Implications of Interim Approval

1. Title V Operating Permits Program

a. Proposed Interim Approval--The EPA is proposing to grant interim

approval to the operating permits program submitted by CARB on behalf

of Mojave Desert on March 10, 1995. Following interim approval, Mojave

Desert must make the following changes to receive full approval:

(1) Revise Rule 1203(G)(3)(g), which prohibits the permit shield

from applying to Administrative Permit Amendments and Significant

Permit Modifications, to include a reference to

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Minor Permit Modifications as well. The permit shield cannot apply to

Minor Permit Modifications, and the rule must state this clearly. See

Sec. 70.7(e)(2)(vi).

(2) Add a provision for sending the final permit to EPA, as

required by Sec. 70.8(a)(1). Mojave's Rule 1203(B)(1)(c) only provides

for sending the proposed permit to EPA.

(3) Adopt Rule 1210 (Acid Rain Provisions of Federal Operating

Permits).

(4) Rule 1206(A)(1)(i) must amend the provision that no reopening

is required if the effective date of the additional applicable

requirement is later than the date on which the permit is due to

expire. If the original permit or any of its terms and conditions are

extended pursuant to Sec. 70.4(b)(10), the permit must be reopened to

include a new applicable requirement, and a statement must be made to

this effect in Mojave's rule (Sec. 70.7(f)(1)(i)).

(5) Clarify in Rule 1203(G)(3)(B) that the permit shield shall not

limit liability for violations which occurred prior to or at the time

of the issuance of the federal operating permit, by adding the

underlined words. This is important to clarify that violations which

are continuing at the time of permit issuance will not be shielded

against.

(6) Lower the cutoff levels for criteria pollutants in Rule 219

(Equipment not Requiring a Permit) or, alternatively, demonstrate that

Mojave Desert's levels are insignificant compared to the level of

emissions from and types of units that are required to be permitted or

are subject to applicable requirements.

(7) Add ``and'' at the end of sections (b) and (c) in Rule

219(B)(2), in order to clarify that the four gatekeepers must all apply

in order for equipment to be exempt from getting a federal operating

permit.

(8) Add to Rule 1203(D)(1)(e)(i) a reference to the requirement for

the clear identification of all deviations with respect to reporting

(Sec. 70.6(a)(3)(iii)(A)).

(9) Add to Rule 1203(D)(1)(e)(ii) a reference to the requirement to

specify the probable cause and corrective actions or preventive

measures taken with regard to reporting a deviation

(Sec. 70.6(a)(3)(iii)(B)).

b. Legislative Source Category-Limited Interim Approval Issue--In

addition to the District-specific issues arising from Mojave Desert's

program submittal and locally adopted regulations, California State law

currently exempts agricultural production sources from permit

requirements. Because of this exemption, California programs are only

eligible for source category-limited interim approval. In order for

this program to receive full approval (and avoid a disapproval upon the

expiration of this interim approval), the California Legislature must

revise the Health and Safety Code to eliminate the exemption of

agricultural production sources from the requirement to obtain a

permit.

c. Implications of Interim Approval--The above described program

and legislative deficiencies must be corrected before Mojave Desert can

receive full program approval. For additional information, please refer

to the Technical Support Document, which contains a detailed analysis

of Mojave Desert's operating permits program, and California's enabling

legislation.

Interim approval, which may not be renewed, would extend for a

period of 2 years. During the interim approval period, the District

would be protected from sanctions, and EPA would not be obligated to

promulgate a federal permits program in the Mojave Desert. Permits

issued under a program with interim approval would have full standing

with respect to part 70, and the 1-year time period for submittal of

permit applications by subject sources would begin upon EPA's final

rulemaking granting interim approval, as would the 3-year time period

for processing initial permit applications.

Following final interim approval, if Mojave Desert should fail to

submit a complete corrective program for full approval by the date 6

months before expiration of the interim approval, EPA would start an

18-month clock for mandatory sanctions. Then, if Mojave Desert should

fail to submit a corrective program that EPA found complete before the

expiration of that 18-month period, EPA would be required to apply one

of the sanctions in section 179(b) of the Act, which would remain in

effect until EPA determined that the District corrected the deficiency

by submitting a complete corrective program. If, six months after

application of the first sanction, the Mojave Desert still had not

submitted a corrective program that EPA found complete, a second

sanction would be required.

If, following final interim approval, EPA were to disapprove Mojave

Desert's complete corrective program, EPA would be required to apply

one of the section 179(b) sanctions on the date 18 months after the

effective date of the disapproval unless prior to that date the

District submitted a revised program and EPA determined that it

corrected the deficiencies that prompted the disapproval. Again, if,

six months after EPA applied the first sanction, Mojave Desert had not

submitted a revised program that EPA determined corrected the

deficiencies, a second sanction would be required. In addition,

discretionary sanctions may be applied where warranted any time after

the end of an interim approval period if a state or district has not

submitted a timely and complete corrective program or EPA has

disapproved a submitted corrective program. Moreover, if EPA has not

granted full approval to a state or district program by the expiration

of an interim approval and that expiration occurs after November 15,

1995, EPA must promulgate, administer and enforce a federal permits

program for that state or district upon interim approval expiration.

2. Section 112(g) Implementation

EPA has decided that it is not reasonable to expect the states and

districts to implement section 112(g) before a rule is issued. EPA

therefore published an interpretive notice in the Federal Register

regarding section 112(g) of the Act: 60 FR 8333 (February 14, 1995).

This notice outlines EPA's revised interpretation of 112(g)

applicability prior to EPA's issuing the final 112(g) rule. The notice

states that major source modifications, constructions, and

reconstructions will not be subject to 112(g) requirements until the

final rule is promulgated. EPA expects to issue the 112(g) final rule

in September 1995.

The notice further explains that EPA is considering whether the

effective date of section 112(g) should be delayed beyond the date of

promulgation of the Federal rule so as to allow States and Districts

time to adopt rules implementing the Federal rule, and that EPA will

provide for any such additional delay in the final section 112(g)

rulemaking. Unless and until EPA provides for such an additional

postponement of section 112(g), Mojave Desert must be able to implement

section 112(g) during the period between promulgation of the Federal

section 112(g) rule and adoption of implementing District regulations.

For this reason, EPA is proposing to approve the use of Mojave

Desert's preconstruction review programs as a mechanism to implement

section 112(g) during the transition period between promulgation of the

section 112(g) rule and adoption by the nineteen districts of rules

specifically designed to implement section 112(g). However, since

approval is intended solely to confirm that Mojave Desert has a

mechanism to implement section 112(g) during the transition period, the

approval itself will be without effect if EPA decides in the final

section 112(g) rule that there will be no transition period. The EPA is

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limiting the duration of its approval of the use of preconstruction

programs to implement 112(g) to 12 months following promulgation by EPA

of the section 112(g) rule.

3. Program for Delegation of Section 112 Standards as Promulgated

Requirements for part 70 program approval, specified in 40 CFR

70.4(b), encompass section 112(l)(5) requirements for approval of a

program for delegation of section 112 standards as promulgated by EPA

as they apply to part 70 sources. Section 112(l)(5) requires that the

District's program contain adequate authorities, adequate resources for

implementation, and an expeditious compliance schedule, which are also

requirements under part 70. Therefore, the EPA is also proposing to

grant approval under section 112(l)(5) and 40 CFR 63.91 of Mojave

Desert's program for receiving delegation of section 112 standards that

are unchanged from the federal standards as promulgated. California

Health and Safety Code section 39658 provides for automatic adoption by

CARB of section 112 standards upon promulgation by EPA. Section 39666

of the Health and Safety Code requires that districts then implement

and enforce these standards. Thus, when section 112 standards are

automatically adopted pursuant to section 39658, Mojave Desert will

have the authority necessary to accept delegation of these standards

without further regulatory action by the District. The details of this

mechanism and the means for finalizing delegation of standards will be

set forth in a Memorandum of Agreement between Mojave Desert and EPA,

expected to be completed prior to approval of Mojave Desert's section

112(l) program for straight delegations. This program applies to both

existing and future standards but is limited to sources covered by the

part 70 program.

4. State Operating Permit Program for Synthetic Minors

On March 31, 1995, CARB submitted for approval into the Mojave

Desert's portion of the California State Implementation Plan (SIP) a

local operating permit program designed to create federally enforceable

limits on a source's potential to emit. This District program is

referred to as a synthetic minor operating permit program, and it

consists of regulations that will be integrated with the District's

existing, non-federally enforceable, operating permit program. Such

programs are also referred to as federally enforceable state operating

permit (FESOP) programs. This synthetic minor or FESOP mechanism will

allow sources to reduce their potential to emit to below the title V

applicability thresholds and avoid being subject to title V.

Mojave Desert's synthetic minor regulations were adopted on

November 23, 1994 and codified in District Regulation XII, Rule 221

(Federal Operating Permit Requirement). EPA found the initial SIP

submittal complete on May 25, 1995.

The five criteria for approving a state operating permit program

into a SIP were set forth in the June 28, 1989 Federal Register notice

(54 FR 27282): (1) The program must be submitted to and approved by

EPA; (2) the program must impose a legal obligation on the operating

permit holders to comply with the terms and conditions of the permit,

and permits that do not conform with the June 28, 1989 criteria shall

be deemed not federally enforceable; (3) the program must contain terms

and conditions that are at least as stringent as any requirements

contained in the SIP or enforceable under the SIP or any other section

112 or other Clean Air Act standard or requirement; (4) permits issued

under the program must contain conditions that are permanent,

quantifiable, and enforceable as a practical matter; and (5) permits

issued under the program must be subject to public participation.

Permits issued under an approved program are federally enforceable

and may be used to limit the potential to emit of sources of criteria

pollutants. Mojave Desert's synthetic minor provisions of Regulation

XII, Rule 221 meet the June 28, 1989 criteria by ensuring that the

limits will be permanent, quantifiable, and practically enforceable and

by providing adequate notice and comment to EPA and the public. Please

refer to the Technical Support Document for a thorough analysis of the

June 28, 1989 criteria as applied to the Mojave Desert's synthetic

minor program.

EPA is proposing to approve pursuant to part 52 and the approval

criteria specified in the June 28, 1989 Federal Register notice the

following regulation that was submitted to create the synthetic minor

operating permit program: Rule 221 (Federal Operating Permit

Requirement).

On March 10, 1995, in its title V program submittal under

``Addendum: Federal Clean Air Act Section 112(l) Authority Request

Letter,'' CARB requested approval of Mojave Desert's synthetic minor

program, consisting of the rules specified above, under section 112(l)

of the Act for the purpose of creating federally enforceable

limitations on the potential to emit of hazardous air pollutants (HAP).

The separate request for approval under section 112(l) is necessary

because the proposed SIP approval discussed above only provides a

mechanism for controlling criteria pollutants. While federally

enforceable limits on criteria pollutants (i.e., VOC's or PM-10) may

have the incidental effect of limiting certain HAP listed pursuant to

section 112(b) 1, section 112 of the Act provides the underlying

authority for controlling HAP emissions that are not criteria

pollutants. As a legal matter, no additional program approval by EPA is

required in order for these criteria pollutant limits to be recognized

as federally enforceable.

\1\ The EPA intends to issue guidance addressing the technical

aspects of how these criteria pollutant limits may be recognized for

purposes of limiting a source's potential to emit of HAP to below

section 112 major source levels.

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EPA has determined that the five approval criteria for approving

FESOP programs into the SIP, as specified in the June 28, 1989 Federal

Register notice, are also appropriate for evaluating and approving the

programs under section 112(l). The June 28, 1989 notice does not

address HAP because it was written prior to the 1990 amendments to

section 112 (which injected the concept of major HAP sources versus

non-major or area HAP sources into the permit) and not because it

establishes requirements unique to criteria pollutants. Hence, the five

criteria outlined above are applicable to FESOP approvals under section

112(l).

In addition to meeting the criteria in the June 28, 1989 notice, a

FESOP program that will control HAP emissions must meet the statutory

criteria for approval under section 112(l)(5). Section 112(l)(5) allows

EPA to approve a program only if it: (1) Contains adequate authority to

assure compliance with any section 112 standard or requirement; (2)

provides for adequate resources; (3) provides for an expeditious

schedule for assuring compliance with section 112 requirements; and (4)

is otherwise likely to satisfy the objectives of the Act.

The EPA plans to codify the approval criteria for programs limiting

potential to emit of HAP in subpart E of part 63 (Subpart E), the

regulations promulgated to implement section 112(l) of the Act. The EPA

currently anticipates that these criteria, as they apply to FESOP

programs controlling HAP, will mirror those set forth in the June 28,

1989 notice, with the addition that the state's authority must extend

to all HAP, instead of, or in addition to, VOC's and PM-10. The EPA

currently anticipates that FESOP programs that are approved

[[Page 34493]]

pursuant to section 112(l) prior to the Subpart E revisions will have

had to meet these criteria, and hence, will not be subject to any

further approval action.

The EPA believes it has authority under section 112(l) to approve

programs to limit potential to emit of HAP directly under section

112(l) prior to this revision to Subpart E. Section 112(l)(5) requires

EPA to disapprove programs that are inconsistent with guidance required

to be issued under section 112(l)(2). This might be read to suggest

that the ``guidance'' referred to in section 112(l)(2) was intended to

be a binding rule. Even under this interpretation, the EPA does not

believe that section 112(l) requires this rulemaking to be

comprehensive. That is, it need not address all instances of approval

under section 112(l). Given the severe timing problems posed by

impending deadlines set forth in MACT standards and for submittal of

title V applications, EPA believes it is reasonable to read section

112(l) to allow for approval of programs to limit potential to emit

prior to issuance of a rule specifically addressing this issue.

EPA proposes approval of Mojave Desert's synthetic minor program

pursuant to section 112(l) because the program meets all of the

approval criteria specified in the June 28, 1989 Federal Register

notice and in section 112(l)(5) of the Act. Please refer to the

Technical Support Document for a complete discussion of how the June

28, 1989 criteria are met by the Mojave Desert. Regarding the statutory

criteria of section 112(l)(5) referred to above, the EPA believes

Mojave Desert's synthetic minor program contains adequate authority to

assure compliance with section 112 requirements since the third

criterion of the June 28, 1989 notice is met: the program does not

provide for waiving any section 112 requirement. Sources would still be

required to meet section 112 requirements applicable to non-major

sources. Furthermore, EPA believes that Mojave Desert's synthetic minor

program provides for an expeditious schedule for assuring compliance

because it allows a source to establish a voluntary limit on potential

to emit and avoid being subject to a federal Clean Air Act requirement

applicable on a particular date. Nothing in Mojave Desert's program

would allow a source to avoid or delay compliance with a federal

requirement if it fails to obtain the appropriate federally enforceable

limit by the relevant deadline. Finally, Mojave Desert's synthetic

minor program is consistent with the objectives of the section 112

program because its purpose is to enable sources to obtain federally

enforceable limits on potential to emit to avoid major source

classification under section 112. The EPA believes this purpose is

consistent with the overall intent of section 112, which is to decrease

the amount of HAP being emitted; by committing to stay below a certain

emission level for HAP, a source with a synthetic minor permit is

achieving this goal.

III. Administrative Requirements

A. Request for Public Comments

The EPA is requesting comments on all aspects of this proposed

interim approval. Copies of Mojave Desert's submittal and other

information relied upon for the proposed interim approval are contained

in a docket maintained at the EPA Regional Office. The docket is an

organized and complete file of all the information submitted to, or

otherwise considered by, EPA in the development of this proposed

interim approval. The principal purposes of the docket are:

(1) To allow interested parties a means to identify and locate

documents so that they can effectively participate in the approval

process, and

(2) To serve as the record in case of judicial review. The EPA will

consider any comments received by August 2, 1995.

B. Executive Order 12866

The Office of Management and Budget has exempted this action from

Executive Order 12866 review.

C. Regulatory Flexibility Act

The EPA's actions under sections 502, 110, and 112 of the Act do

not create any new requirements, but simply address operating permit

programs submitted to satisfy the requirements of 40 CFR part 70.

Because this action does not impose any new requirements, it does not

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

Unfunded Mandates

Under Section 202 of the Unfunded Mandates Reform Act of 1995

(``Unfunded Mandates Act''), signed into law on March 22, 1995, EPA

must prepare a budgetary impact statement to accompany any proposed or

final rule that includes a Federal mandate that may result in estimated

costs to state, local, or tribal governments in the aggregate; or to

the private sector, of $100 million or more. Under Section 205, EPA

must select the most cost-effective and least burdensome alternative

that achieves the objectives of the rule and is consistent with

statutory requirements. Section 203 requires EPA to establish a plan

for informing and advising any small governments that may be

significantly or uniquely impacted by the rule.

EPA has determined that the proposed approval action promulgated

today 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 proposed

federal action approves pre-existing requirements under state or local

law, and imposes no new federal requirements. Accordingly, no

additional costs to state, local, or tribal governments, or to the

private sector, result from this action.

List of Subjects 40 CFR Part 52

Environmental protection, Air pollution control, Carbon monoxide,

Hydrocarbons, Intergovernmental relations, Lead, Nitrogen dioxide,

Ozone, Particulate matter, Sulfur oxides, Volatile organic compounds.

40 CFR Part 70

Administrative practice and procedure, Air pollution control,

Environmental protection, Hazardous substances, Intergovernmental

relations, Operating permits, Reporting and recordkeeping requirements.

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

Dated: June 23, 1995.

David P. Howekamp,

Acting Regional Administrator.

[FR Doc. 95-16276 Filed 6-30-95; 8:45 am]

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