Clean Air Act Final Interim Approval of the Operating Permits Program; Washoe County District Health Department, Nevada

ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 70

[AD-FRL-5134-2]

Clean Air Act Final Interim Approval of the Operating Permits

Program; Washoe County District Health Department, Nevada

AGENCY: Environmental Protection Agency (EPA).

ACTION: Final rule.

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SUMMARY: The EPA is promulgating interim approval of the operating

permits program submitted by the Washoe County District Health

Department (Washoe 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.

EFFECTIVE DATE: March 6, 1995.

ADDRESSES: Copies of the District's submittal and other supporting

information used in developing the final interim approval are available

for inspection (docket number NV-WSH-94-1-OPS) 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: Celia Bloomfield (telephone 415/744-

1249), 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

Title V of the Clean Air Act (Act), and implementing regulations at

40 CFR part 70 require that states develop and submit operating permit

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 August 24, 1994, EPA proposed interim approval of the operating

permits program for Washoe County, Nevada. See 59 FR 43523. The August

24, 1994 Federal Register document also proposed approval of Washoe's

interim mechanism for implementing section 112(g) and program for

delegation of section 112 standards as promulgated. Public comment was

solicited on these proposed actions. EPA received one comment on the

section 112(g) proposal and is responding to that comment in this

document and in a separate ``Response to Comments'' document that is

available in the docket. The proposed actions have not been altered as

a result of public comment or for any other reason. Hence, this final

rule is granting interim approval to Washoe's operating permits program

and approving the 112(g) and 112(l) mechanisms noted above.

II. Final Action and Implications

A. Analysis of State Submission

Washoe's title V operating permits program was submitted by the

Nevada Division of Environmental Protection, on behalf of Washoe, on

November 18, 1993 and found to be complete on January 13, 1994. The

regulations that comprise the program were adopted by the Washoe County

District Board of [[Page 1742]] Health on October 20, 1993. EPA

proposed interim approval, in accordance with Sec. 70.4(d), on August

24, 1994 (59 FR 43523) on the basis that the program ``substantially

meets'' part 70 requirements. The analysis in the proposed document

remains unchanged and will not be repeated in this final document. The

program deficiencies identified in the proposed document, and outlined

below, also remain unchanged and must be corrected for the District to

have a fully approvable program.

At the time of proposal, EPA believed that an implementation

agreement would be completed prior to final interim approval. EPA and

Washoe have not yet finalized the implementation agreement, however,

but are working to do so as soon as practicable.

As discussed in the proposed document, Washoe has authority under

State and local law to issue a variance from State and local

requirements. The EPA would like to reiterate that the Agency has no

authority to approve provisions of state or local law that are

inconsistent with the Act, and 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 procedures allowed by part 70.

B. Public Comment

EPA received one public comment regarding the proposed approval of

Washoe's preconstruction permitting program for the purpose of

implementing section 112(g) during the transition period between title

V approval and adoption of a District rule implementing EPA's section

112(g) regulations. In opposition to the proposed action, one commenter

argued that Washoe should not, and cannot, implement section 112(g)

until: (1) EPA has promulgated a section 112(g) regulation; and (2) the

District has a section 112(g) program in place.

EPA disagrees with the commenter's contention that section 112(g)

does not take effect until after EPA has promulgated implementing

regulations. The statutory language in section 112(g)(2) prohibits the

modification, construction, or reconstruction of a source after the

effective date of a title V program unless MACT (determined on a case-

by-case basis, if necessary) is met. The plain meaning of this

provision is that the prohibition takes effect on the effective date of

title V regardless of whether EPA or a state has promulgated

implementing regulations.

The EPA has acknowledged that states may encounter difficulties

implementing section 112(g) prior to the promulgation of final EPA

regulations (See June 28, 1994 memorandum entitled, ``Guidance for

Initial Implementation of Section 112(g),'' signed by John Seitz,

Director of the Office of Air Quality Planning and Standards.) EPA has

issued guidance, in the form of a proposed rule, which may be used to

determine whether a physical or operational change at a source is not a

modification either because it is below de minimis levels or because it

has been offset by a decrease of more hazardous emissions. See 59 FR

15004 (April 1, 1994). The EPA believes the proposed rule provides

sufficient guidance to Washoe and sources until such time as EPA's

section 112(g) rulemaking is finalized.

The EPA is aware that Washoe lacks a program designed specifically

to implement section 112(g). However, Washoe does have authority to

regulate hazardous air pollutants (HAP) in its preconstruction review

program, and hence, the preconstruction review program can serve as a

procedural vehicle for rendering a case-by-case MACT or offset

determination federally enforceable. The EPA believes Washoe's

preconstruction review program will be adequate because it will allow

Washoe to select control measures that would meet MACT, as defined in

section 112, and incorporate those measures into a federally

enforceable preconstruction permit. By approving Washoe's

preconstruction review program under the authority of title V and part

70, EPA is clarifying that it may be used for the purpose of

implementing section 112(g) during the transition period.

One consequence of the fact that Washoe lacks a program designed

specifically to implement section 112(g) is that the applicability

criteria found in its preconstruction review program may differ from

those in section 112(g). However, whether a particular source change

qualifies as a modification, construction, or reconstruction for

section 112(g) purposes will be determined according to the statutory

provisions of section 112(g), using the proposed rule as guidance. As

noted in the June 28, 1994 guidance, EPA intends to defer wherever

possible to a state's judgement regarding applicability determinations.

This deference must be subject to obvious limitations. For instance, a

physical or operational change resulting in a net increase in HAP

emissions above 10 tons per year could not be viewed as a de minimis

increase under any interpretation of the Act. The EPA would expect

Washoe to issue a preconstruction permit containing a case-by-case

determination of MACT in such a case even if review under its own

preconstruction review program would not be triggered.

C. Interim Approval and Implications

1. Title V Operating Permits Program

The EPA is granting interim approval to the operating permits

program submitted to EPA by the Nevada Division of Environmental

Protection, on behalf of Washoe, on November 18, 1993. The District

must make the following changes to receive full approval:

(1) Revise insignificant activity provisions so that they comply

with Sec. 70.5(c). Specifically, rule 030.905(B)(3) must state that any

activity at a title V facility that is subject to an applicable

requirement may not qualify as an insignificant activity. Because

Washoe defines insignificant activities by size, both rule

030.020(C)(4) and the application form must require the applicant to

list all insignificant activities in enough detail to determine

applicability and fees, and to impose any applicable requirements.

(2) Revise 030.020 to state that each application must contain the

following information: (1) Description of any processes and products

associated with alternate scenarios (Sec. 70.5(c)(2)); (2) description

of compliance monitoring devices or activities (Sec. 70.5(c)(3)(v));

(3) when emissions trading provisions are requested by a source,

proposed replicable procedures and permit terms

(Sec. 70.4(b)(12)(iii)); and (4) a statement that the source will, in a

timely manner, meet all applicable requirements that will become

effective during the permit term (Sec. 70.5(c)(8)). EPA has also noted

in the Technical Support Document recommended revisions to Washoe's

permit application form so that the form will better reflect the

information required by regulation. These recommended revisions,

however, are not required for full approval. In addition, rule 030.020

must clearly require that any application form, report, or compliance

certification submitted in the permit application include a

certification based on information and belief formed after reasonable

inquiry. (Sec. 70.5(d))

(3) Add a provision to the rule that imposes a general duty on the

permit applicant to submit supplementary facts or corrected information

upon becoming aware of any failure to submit relevant facts or

submittal of incorrect information. (Sec. 70.5(b))

(4) Revise 030.930 to provide public notice ``by other means if

necessary to assure adequate notice to the affected public.''

(Sec. 70.7(h)(1)) [[Page 1743]]

(5) Revise 030.960(C)(8) to state that the certifications must be

based on information and belief formed after reasonable inquiry.

(Sec. 70.6(c)(1) and Sec. 70.5(d))

(6) Revise 030.970(B) to state that schedules for compliance shall

resemble and be at least as stringent as that contained in any judicial

consent decree or administrative order. (Sec. 70.5(c)(8)(iii)(C) and

Sec. 70.6(c)(3))

(7) Part 70 prohibits sources from implementing significant permit

modifications prior to final permit action unless the changes have

undergone preconstruction review pursuant to section 112(g) or a

program approved into the SIP pursuant to part C or D of title I, and

the changes are not otherwise prohibited by the source's existing part

70 permit. Washoe's regulations require sources to submit applications

for significant permit modifications 6 months prior to implementing the

change, yet final permit action may not occur until 9 months after

receipt of a complete application. Hence, rule 030.950(E) must be

revised to eliminate the 3 month time frame that sources are able to

implement significant permit modifications without revised permits.

(Sec. 70.5(a)(1)(ii))

2. Implications of Title V Interim Approval

As a result of today's final interim approval of Washoe's part 70

program, the requirement to submit a permit application to Washoe

applies to all part 70 sources, as defined in the approved program,

within Washoe's jurisdiction, except for any source of air pollution

over which a federally recognized Indian Tribe has jurisdiction. See,

e.g., 59 FR 55813, 55815-55818 (November 9, 1994).

This interim approval, which may not be renewed, extends until

February 5, 1997. During this interim approval period, Washoe is

protected from sanctions, and EPA is not obligated to promulgate,

administer and enforce a Federal operating permits program in Washoe

County. Permits issued under a program with interim approval have full

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

submittal of permit applications by subject sources begins upon the

effective date of this interim approval, as does the 3-year time period

for processing the initial permit applications.

If Washoe fails to submit a complete corrective program for full

approval by August 5, 1996. EPA will start an 18-month clock for

mandatory sanctions. If Washoe then fails to submit a corrective

program that EPA finds complete before the expiration of that 18-month

period, EPA will be required to apply one of the sanctions in section

179(b) of the Act, which will remain in effect until EPA determines

that Washoe has corrected the deficiency by submitting a complete

corrective program. Moreover, if the Administrator finds a lack of good

faith on the part of Washoe, both sanctions under section 179(b) will

apply after the expiration of the 18-month period until the

Administrator determines that Washoe has come into compliance. In any

case, if, six months after application of the first sanction, Washoe

still has not submitted a corrective program that EPA has found

complete, a second sanction will be required.

If EPA disapproves Washoe's complete corrective program, EPA will

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 Washoe has submitted a revised program and EPA has determined

that it corrected the deficiencies that prompted the disapproval.

Moreover, if the Administrator finds a lack of good faith on the part

of Washoe, both sanctions under section 179(b) shall apply after the

expiration of the 18-month period until the Administrator determines

that Washoe has come into compliance. In all cases, if, six months

after EPA applies the first sanction, Washoe has not submitted a

revised program that EPA has determined corrects the deficiencies, a

second sanction is required.

In addition, discretionary sanctions may be applied where warranted

any time after the expiration of an interim approval period if Washoe

has not submitted a timely and complete corrective program or EPA has

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

granted full approval to the Washoe program by the expiration of this

interim approval and that expiration occurs after November 15, 1995,

EPA must promulgate, administer and enforce a Federal permits program

for Washoe County upon interim approval expiration.

3. District Preconstruction Permit Program Implementing Section 112(g)

The EPA is approving Washoe's preconstruction permitting program

found in District rules 030.000 and 030.002 under the authority of

title V and part 70 solely for the purpose of implementing section

112(g) during the transition period between title V approval and

adoption of a District rule implementing EPA's section 112(g)

regulations. This approval is limited in duration and will expire 12

months after EPA promulgates section 112(g) regulations.

4. Program for Delegation of Section 112 Standards as Promulgated

The EPA is approving under section 112(l)(5) and 40 CFR section

63.91 Washoe's program for receiving delegation of section 112

standards that are unchanged from the Federal standards as promulgated.

Washoe has informed EPA that it intends to obtain the regulatory

authority necessary to accept delegation of section 112 standards by

incorporating section 112 standards into District regulations by

reference to the Federal regulations. The details of this delegation

mechanism will be set forth in a Memorandum of Agreement between Washoe

and EPA. This program for delegations only applies to sources covered

by the title V program.

III. Administrative Requirements

A. Docket

Copies of Washoe's submittal and other information relied upon for

the final interim approval, including the one public comment received

and reviewed by EPA on the proposal, are contained in docket number NV-

WSH-94-1-OPS 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 final interim

approval. The docket is available for public inspection at the location

listed under the ADDRESSES section of this document.

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 section 502 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.

List of Subjects in 40 CFR Part 70

Environmental protection, Administrative practice and procedure,

Air pollution control, Intergovernmental relations, Operating permits,

Reporting and recordkeeping requirements.

[[Page 1744]] Dated: December 16, 1994.

Felicia Marcus,

Regional Administrator.

Part 70, title 40 of the Code of Federal Regulations is amended as

follows:

PART 70--[AMENDED]

1. The authority citation for part 70 continues to read as follows:

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

2. Appendix A to part 70 is amended by adding the entry for Nevada

in alphabetical order to read as follows:

Appendix A to Part 70--Approval Status of State and Local Operating

Permits Programs

* * * * *

Nevada

(a) (Reserved)

(b) Washoe County District Health Department: submitted on November

18, 1993; interim approval effective on March 6, 1995; interim approval

expires February 5, 1997.

* * * * *

[FR Doc. 95-253 Filed 1-4-95; 8:45 am]

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