Clean Air Act Final Interim Approval Of Operating Permits Program; State of North Carolina, Western North Carolina, Forsyth County, and Mecklenburg County

ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 70

[NC-95-01; FRL-5332-2]

Clean Air Act Final Interim Approval Of Operating Permits

Program; State of North Carolina, Western North Carolina, Forsyth

County, and Mecklenburg County

AGENCY: Environmental Protection Agency (EPA).

ACTION: Final interim approval.

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SUMMARY: EPA is promulgating interim approval of the operating permit

program submitted by the State of North Carolina Department of Health

(DEHNR), Western North Carolina Regional Air Pollution Control Agency

(WNCRAPCA), Forsyth County Department of Environmental Affairs (FCDEA),

and Mecklenburg County Department of Environmental Protection (MCDEP)

for the purpose of complying with Federal requirements for an

approvable State program to issue operating permits to all major

stationary sources, and to certain other sources.

EFFECTIVE DATE: December 15, 1995.

ADDRESSES: Copies of the North Carolina State and local agency

submittals and the other supporting information used in developing the

final interim approval are available for inspection during normal

business hours at the following location: U.S. Environmental Protection

Agency, Region 4, 345 Courtland Street, NE., Atlanta, Georgia 30365.

Interested persons wanting to examine these documents, contained in EPA

docket number NC-95-01, should make an appointment at least 24 hours

before the visiting day.

FOR FURTHER INFORMATION CONTACT: Scott Miller, Title V Program

Development Team, Air Programs Branch, Air Pesticides & Toxics

Management Division, U.S. EPA Region 4, 345 Courtland Street NE.,

Atlanta, GA 30365, (404) 347-3555 extension 4153.

SUPPLEMENTARY INFORMATION:

I. Background and Purpose

Title V of the 1990 Clean Air Act Amendments (the Act) and the

implementing regulations at 40 Code of Federal Regulations (CFR) part

70 require that States develop and submit operating permits programs to

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

each program within one year after receiving the submittal. If the

State or local agency submittals are changed during the one-year review

period, 40 CFR 70.4(e)(2) allows EPA to extend the review period for no

more than one year following

[[Page 57358]]

receipt of additional materials. EPA received the North Carolina State

and local agency submittals on November 12, 1993. The State and local

agencies provided EPA with additional materials in supplemental

submittals dated December 17, 1993; February 28, 1994; May 31, 1994;

and August 9, 1995. Because the supplements materially changed the

State and local agency title V program submittals, EPA extended the

one-year review period.

EPA reviews state and local operating permit programs 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 two years.

If EPA has not fully approved a program by November 15, 1995, or by the

end of an interim program, it must establish and implement a Federal

operating permit program for the state or local agency.

On August 29, 1995, EPA proposed interim approval of the operating

permits program for the DEHNR, WNCRAPCA, FCDEA, and MCDEP. See 60 FR

44805. The August 29, 1995 notice also proposed approval of the DEHNR,

WNCRAPCA, FCDEA, and MCDEP interim mechanism for implementing section

112(g) and for delegation of section 112 standards and programs that

are unchanged from the Federal rules as promulgated. Public comment was

solicited on these proposed actions. In this document, EPA is

responding to the comments received and taking final action to

promulgate interim approval of the North Carolina State and local

operating permit programs.

II. Final Action and Implications

A. Analysis of State Submission and Response to Public Comments

On August 29, 1995, EPA proposed interim approval of the DEHNR,

WNCRAPCA, FCDEA, and MCDEP title V operating permit programs. See 60 FR

44805. The program elements discussed in the proposal notice are

unchanged from the proposal notice and continue to substantially meet

the requirements of title V and part 70. For detailed information on

EPA's analysis of North Carolina State and local program submittals,

please refer to the Technical Support Document (TSD) contained in the

docket at the address noted above.

EPA received one letter during the 30-day public comment period

held on the proposed interim approval of the North Carolina State and

local agency programs. The commenter requests that EPA extend the title

V permit application submittal deadline for at least two years from the

effective date of approval for the DEHNR, WNCRAPCA, FCDEA, and MCDEP

due to the complexity and evolving nature of the title V program. The

application submittal deadline is a function of North Carolina State

and local law in response to the original part 70 regulations

promulgated July 21, 1992. See 57 FR 32250. Section 503(c) of the Act

requires all title V facilities to submit an application to the

relevant state and local permitting authorities within one year after

the effective date of the title V program approval. The DEHNR,

WNCRAPCA, FCDEA, and MCDEP programs fulfill this statutory requirement.

Therefore, EPA denies the request to extend the title V permit

application submittal deadline for at least two years from the

effective date of approval for the DEHNR, WNCRAPCA, FCDEA, and MCDEP

title V operating permit programs.

The commenter requests that insignificant activity levels for

hazardous air pollutants (HAP) should be set no lower than the section

112(g) de minimis levels for individual pollutants. The commenter is

concerned that ``increases above the 112(g) de minimis levels trigger a

complex review process and the State should be given the flexibility to

reserve limited resources for more significant modifications.'' Section

70.4(b)(2) requires state and local agencies 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 or local agency must request and EPA may approve as part of that

state's or local agency's program any activities or emission levels

that they wish to consider insignificant. Part 70, however, does not

establish emission thresholds for insignificant activities. EPA has

accepted emission thresholds of five tons per year for criteria

pollutants, and the lesser of 1000 pounds per year or section 112(g) de

minimis levels for HAP, as reasonable.

The commenter urges EPA to limit the amount of fees that may be

charged to a facility to be limited to the presumptive minimum ($25/ton

of actual emissions adjusted annually to the Consumer Price Index

(CPI)). The Act leaves to state discretion the structure of the title V

fee schedule provided it meets the requirement of presumptive minimum

or cost of the program. The DEHNR, FCDEA, and MCDEP fee schedules were

set to raise, in the aggregate, the presumptive minimum based on

estimates of title V source numbers and emissions. The flat fee plus

tonnage fee formula was recommended by a State-legislatively

established Clean Air Act Advisory Council to reflect work effort to

issue and enforce permits. It was adopted by the Environmental

Management Commission after public hearings. This fee formula means

that some sources will pay less than a straight $25 plus inflation per

ton fee, and some will pay more. In the aggregate, fee revenue has not

exceeded the presumptive minimum. In the North Carolina State and local

agency proposed program approval notice, EPA noted submittal of fee

demonstrations from the DEHNR, FCDEA, and MCDEP that showed each

program will collect the presumptive minimum fee. The WNCRAPCA

submitted a title V program fee demonstration that demonstrated that it

will collect less than the presumptive minimum. Therefore, the DEHNR,

WNCRAPCA, FCDEA, and MCDEP have in effect accommodated the commenter's

request.

The commenter requested that EPA urge the DEHNR, WNCRAPCA, FCDEA,

and MCDEP to set aside any surplus monies generated in the title V

operating permit program to be placed in a separate interest-bearing

account. The commenter further requests that these funds should be

applied as a credit against fees required in succeeding years,

according to the proportion of the total of all emissions fees which

were paid by a title V facility in a timely manner. As previously

stated, the Act leaves to state discretion the structure of the title V

fee schedule provided it meets the requirement of presumptive minimum

or cost of the program. State statutes provide that the fees go into a

separate title V nonreverting account. State statutes do not provide

for interest, as they would have to for interest to be credited. State

statutes do provide for reductions of fees when and if the funds in the

account exceed the title V program cost for the next fiscal year.

The commenter requests that EPA urge DEHNR, WNCRAPCA, FCDEA, and

MCDEP to adopt a list of ``trivial activities,'' as outlined in the

EPA's ``White Paper for Streamlined

[[Page 57359]]

Development of Part 70 Permit Applications'' as well as develop a

process for approving trivial activities on a case-by-case basis. EPA

notes that DEHNR, WNCRAPCA, FCDEA, and MCDEP have an insignificant

activities list found at 15A NCAC 2Q.0102 and respective local agency

regulations which include activities that do not have to be included in

a title V permit application. Should the State and local programs elect

to utilize the list of trivial activities from the ``White Paper for

Streamlined Development of Part 70 Permit Applications,'' they may do

so at their own discretion. In addition, DEHNR, WNCRAPCA, FCDEA, and

MCDEP have complete discretion over whether to create a process for

case-by-case determinations of trivial activities. EPA recommends that

the commenter make any such request to DEHNR, WNCRAPCA, FCDEA, and

MCDEP.

Finally, the commenter took opportunity to make comments regarding

provisions of the part 70 supplemental revisions published on August

31, 1995. See 60 FR 45530. This rulemaking exclusively covers the

DEHNR, WNCRAPCA, FCDEA, and MCDEP title V operating permit programs

which are being approved under the existing regulations found at 40 CFR

part 70. EPA recommends that the commenter provide comment on the

proposed part 70 revisions to the appropriate rulemaking docket for the

subject rulemaking found at 60 FR 45530 (August 31, 1995).

B. Final Action

1. Title V Operating Permit Program

EPA is promulgating interim approval of the operating permits

program submitted by the DEHNR, WNCRAPCA, FCDEA, and MCDEP on November

12, 1993, and supplemented on December 17, 1993; February 28, 1994; May

31, 1994; and August 9, 1995. The DEHNR, WNCRAPCA, FCDEA, and MCDEP

must make the following changes to receive full program approval:

(a) Revise Regulation 15A NCAC 2Q.0507 (MCAPCO Regulation 1.5507,

FCAQTC Regulation 3Q.0507, and WNCRAPCARR Regulation 17.0507) to

require an applicant to include all fugitive emissions regardless of

whether such emissions will be used to determine title V applicability.

These fugitive emissions estimates may be of a qualitative nature as

opposed to a numerical quantitative emission estimate.

(b) Revise Regulation 15A NCAC 2Q.0502(c) (MCAPCO Regulation

1.5502(c), FCAQTC Regulation 3Q.0502(c), and WNCRAPCARR Regulation

17.0502(c)) to assure that R&D facilities which are collocated with

manufacturing facilities and which are under common control and

belonging to a single major industrial grouping will be considered as

the same facility for determining title V major source applicability

for a facility. This change will not be necessary in the event that EPA

promulgates revisions to part 70 that are similar to the DEHNR,

WNCRAPCA, FCDEA, and MCDEP current treatment of R&D facilities for

purposes of title V applicability.

(c) Revise Regulation 15A NCAC 2Q.0102(b)(2)(B) and respective

local agency regulations to adjust the insignificant emission threshold

levels downward from potential emissions of 40 tpy to potential per

emission unit levels for insignificant activities of 5 tons per year

for criteria pollutants and the lesser of 1000 pounds per year or

section 112(g) de minimis levels for HAP. The DEHNR, WNCRAPCA, FCDEA,

and MCDEP must also revise Regulation 15A NCAC 2Q.0102(b)(2)(F) and

respective local agency regulations to provide that the list granted

under 15A NCAC 2Q.0102(b)(2)(F) must be subject to the above-mentioned

potential emission caps.

(d) Revise Regulation 15A NCAC 2Q.0514(a)(4) and respective local

agency regulations to clarify that administrative permit amendments may

be used to change test dates or construction dates only as long as no

applicable requirements would be violated by doing so. Also, the DEHNR,

WNCRAPCA, FCDEA, and MCDEP agencies must change the language of

Regulation 15A NCAC 2Q.0514(a)(4) and respective local agency

regulations to clarify that an administrative permit amendment may be

used to move terms and conditions from the State-enforceable side of

the permit to the State and Federal enforceable portion of the permit

provided that the term being moved is a requirement which has become

Federally enforceable through sections 110, 111, or 112 or other parts

of the Clean Air Act.

(e) Revise Regulation 15A NCAC 2Q.0515(f) and respective local

agency regulations to stipulate that a permit shield may not be granted

for a minor permit modification. In addition, the DEHNR, WNCRAPCA,

FCDEA, and MCDEP must change Regulation 15A NCAC 2Q.0515(d) and

respective local agency regulations to specify that in the event an

applicant submits a single minor permit modification which exceeds the

thresholds listed in 15A NCAC 2Q.0515(c), the minor permit modification

must be processed within 90 days after receiving the application or 15

days after the end of EPA's 45 day review period, whichever is later.

(f) Revise Regulation 15A NCAC 2Q.0517(b) and respective local

agency regulations to provide that a title V permit shall be reopened

and reissued within 18 months after a newly applicable requirement is

promulgated. Also, the DEHNR, WNCRAPCA, FCDEA, and MCDEP must amend

Regulation 15A NCAC 2Q.0517(b)(2) and respective local agency

regulations to clarify that no reopening of a permit is required only

if the effective date of a newly applicable requirement is after the

expiration of the permit, unless the term of the permit was extended

based on the fact that the DEHNR, WNCRAPCA, FCDEA, and MCDEP had not

renewed the permit prior to its expiration.

(g) Revise Regulation 15A NCAC 2Q.0518(f) and respective local

agency regulations to remove the phrase ``subject to adjudication.''

The scope of the DEHNR, WNCRAPCA, FCDEA, and MCDEP part 70 programs

approved in this document applies to all part 70 sources (as defined in

the approved program) within the State, except any sources of air

pollution over which an Indian Tribe has jurisdiction. See, e.g., 59 FR

55813, 55815-55818 (November 9, 1994). The term ``Indian Tribe'' is

defined under the Act as ``any Indian tribe, band, nation, or other

organized group or community, including any Alaska Native village,

which is Federally recognized as eligible for the special programs and

services provided by the United States to Indians because of their

status as Indians.'' See section 302(r) of the CAA; see also 59 FR

43956, 43962 (August 25, 1994); 58 FR 54364 (October 21, 1993).

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

December 15, 1997. During this interim approval period, the State of

North Carolina is protected from sanctions, and EPA is not obligated to

promulgate, administer, and enforce a Federal operating permits program

in the State. Permits issued under a program with interim approval have

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

submittal of permit applications by subject sources begins upon the

effective date of this final interim approval, as does the three-year

time period for processing the initial permit applications.

If the State of North Carolina fails to submit a complete

corrective program for full approval by June 16, 1997, EPA will start

an 18-month clock for mandatory sanctions. If North Carolina then fails

to submit a corrective program that EPA finds complete before the

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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 North Carolina has corrected the

deficiency by submitting a complete corrective program. Moreover, if

the Administrator finds a lack of good faith on the part of North

Carolina, both sanctions under section 179(b) will apply after the

expiration of the 18-month period until the Administrator determines

that North Carolina has come into compliance. In any case, if, six

months after the application of the first sanction, North Carolina has

not submitted a corrective program that EPA has found complete, a

second sanction will be required.

If EPA disapproves North Carolina'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 the State 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 North Carolina, both sanctions under section 179(b) will

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

Administrator determines that the State has come into compliance. In

all cases, if, six months after EPA applies the first sanction, North

Carolina has not submitted a revised program that EPA determines to

have corrected the deficiencies that prompted disapproval, a second

sanction will be required.

In addition, discretionary sanctions may be applied where warranted

any time after the expiration of an interim approval period if a state

has not timely submitted a complete corrective program. Moreover, if

EPA has not granted full approval to a state program by the expiration

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

1995, EPA must promulgate, administer, and enforce a Federal operating

permit program for that state upon interim approval expiration.

2. Preconstruction Review Program Implementing Section 112(g)

EPA is approving the use of the North Carolina State and local

agency's preconstruction review programs found in Regulation 15A NCAC

2Q.0300 and respective local agency regulations as a mechanism to

implement section 112(g) during the transition period between

promulgation of EPA's section 112(g) rule and the North Carolina State

and local programs adoption of rules specifically designed to implement

section 112(g). This approval is limited to the implementation of the

112(g) rule and is effective only during any transition time between

the effective date of the 112(g) rule and the adoption of specific

rules by the North Carolina State and local agencies to implement

112(g). The duration of this approval is limited to 18 months following

promulgation by EPA of section 112(g) regulations, to provide the North

Carolina State and local agencies with adequate time to adopt

regulations consistent with Federal requirements.

3. Program for Delegation of Section 112 Standards as Promulgated

The requirements for part 70 program approval, specified in 40 CFR

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

state and local program for delegation of section 112 standards

promulgated by EPA as they apply to title V sources. Section 112(l)(5)

requires that the State and local programs contain adequate

authorities, adequate resources for implementation, and an expeditious

compliance schedule, which are also requirements under part 70.

Therefore, EPA is approving under section 112(l)(5) and 40 CFR 63.91,

the North Carolina State and local programs for receiving delegation of

section 112 standards and programs that are unchanged from the Federal

rules as promulgated. EPA is also approving the delegation of all

existing standards under 40 CFR parts 61 and 63. This program for

delegation applies to both part 70 and non-part 70 sources.1

\1\ The radionuclide National Emission Standards for Hazardous

Air Pollutant (NESHAP) is a section 112 regulation and therefore,

also an applicable requirement under the State and local operating

permit programs for part 70 sources. There is not yet a Federal

definition of ``major'' for radionuclide sources. Therefore, until a

major source definition for radionuclide is promulgated, no source

would be a major section 112 source solely due to its radionuclide

emissions. However, a radionuclide source may, in the interim, be a

major source under part 70 for another reason, thus requiring a part

70 permit. EPA will work with the State and local agencies in the

development of a radionuclide program to ensure that permits are

issued in a timely manner.

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Based on the delegation requests North Carolina submitted by North

Carolina and each local agency, EPA has determined that all

requirements (i.e., legal authority, available resources,

implementation schedules, and compliance mechanisms) necessary for

delegation have been satisfied. As the delegation relates to the

existing NESHAP standards, the effective date of the delegations would

be the date the individual standards become effective as a matter of

State or local law. For future standards, the State of North Carolina,

once State approved, will utilize automatic adoption as its delegation

mechanism. Hence, all standards will be state effective on the date of

EPA promulgation. Subsequent (or within thirty days) to the State's

delegation, the local programs will seek delegation of Federal

authorities. During the interim period between Federal promulgation and

the effective local delegations, the North Carolina State and local

programs will continue to implement the standards, excluding

enforcement actions, under a Memorandum of Agreement entered into with

EPA. EPA will retain primary enforcement authority until the respective

effective dates for each promulgated standard becomes State and locally

effective. The most efficient use of State, local and EPA resources

would dictate usage of this streamlined approval approach, thereby,

negating the need for either the North Carolina State or any of the

local programs to submit additional demonstrations of authority

sufficiency, resource availability, and/or implementation mechanisms

for any requests that are not approved with this title V approval

action.

III. Administrative Requirements

A. Docket

Copies of the State and local agency submittals and other

information relied upon for the final interim approval, including the

one public comment letter received and reviewed by EPA on the proposal

notice, are contained in docket number NC-95-01 maintained at the EPA

Region 4 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

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.

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D. Unfunded Mandates

Under section 202 of the Unfunded Mandates Reform Act of 1995,

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 interim approval action

promulgated today does not include a Federal mandate that may result in

estimated costs of $100 million or more to state, local, or tribal

governments in the aggregate, or to the private sector. This 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 in 40 CFR Part 70

Environmental protection, Administrative practice and procedure,

Air pollution control, Intergovernmental relations, Operating permits,

Reporting and recordkeeping requirements.

Dated: November 2, 1995.

Patrick M. Tobin,

Acting 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 North

Carolina in alphabetical order to read as follows:

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

Permits Programs

* * * * *

North Carolina

(a) Department of Environment, Health and Natural Resources,

Western North Carolina Regional Air Pollution Control Agency, Forsyth

County Department of Environmental Affairs and the Mecklenburg County

Department of Environmental Protection: submitted on November 12, 1993,

and supplemented on December 17, 1993; February 28, 1994; May 31, 1994;

and August 9, 1995; interim approval effective on December 15, 1995;

interim approval expires December 15, 1997.

(b) (Reserved)

* * * * *

[FR Doc. 95-28186 Filed 11-14-95; 8:45 am]

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