Clean Air Act Final Interim Approval of Operating Permits Program; Washington

ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 70

[AD-FRL-5343-3]

Clean Air Act Final Interim Approval of Operating Permits

Program; Washington

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

ACTION: Final interim approval and notice of correction.

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SUMMARY: EPA is repromulgating final interim approval of one element of

the State of Washington's title V air operating permits program. On

November 9, 1994, EPA granted interim approval to Washington's

operating permits program. 59 FR 55813 (November 9, 1994). One of the

bases for granting Washington's program interim rather than full

approval was that EPA determined that Washington's exemption for

``insignificant emission units'' exceeded the exemption authorized for

such units under the Clean Air Act. A coalition of industries filed a

petition for review of EPA's decision to condition full approval on

changes to Washington's treatment of insignificant emission units. Upon

EPA's request for a voluntary remand, the Court remanded this interim

approval issue to EPA for reconsideration. EPA continues to believe

that Washington has impermissibly expanded the exemption for

insignificant emission units and therefore again conditions full

approval of the Washington operating permits program on changes to

Washington's treatment of insignificant emission units.

EPA is also approving a change to the jurisdiction of the Benton

County Clean Air Authority.

Finally, EPA is correcting the date for expiration of the interim

approval and the due date of the required submission addressing the

interim approval issues.

EFFECTIVE DATE: January 8, 1996.

ADDRESSES: Copies of Washington's submittal and other supporting

information used in developing this action are available for inspection

during normal business hours at the address indicated.

FOR FURTHER INFORMATION CONTACT: Elizabeth Waddell, 1200 Sixth Avenue,

Seattle, Washington 98101.

SUPPLEMENTARY INFORMATION:

I. Background and Purpose

A. Introduction

As required under title V of the 1990 Clean Air Act Amendments

(sections 501-507 of the Clean Air Act (``the Act'')), EPA has

promulgated rules which 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 Code of Federal Regulations

(CFR) Part 70. Title V requires States to develop, and submit to EPA,

programs for issuing these operating permits to all major stationary

sources and to certain other sources.

The Act requires that States develop and submit these programs to

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

each program within 1 year after receiving the submittal. 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.

B. Previous Action on Washington's Program

Washington submitted its operating permits program to EPA in

November 1993. In November 1994, EPA granted interim approval to

Washington's program and conditioned full approval on, among other

things, revisions to Washington's regulations pertaining to the

treatment of insignificant emission units (IEUs).\1\ See 59 FR 55813

(November 9, 1994). On January 9, 1995, the Western States Petroleum

Association, Northwest Pulp & Paper Association, Aluminum Company of

America, Columbia Aluminum Corporation, Intalco Aluminum Corporation,

Kaiser Aluminum & Chemical Corporation and Vanalco Inc. (collectively,

``Petitioners'') filed a petition with the United States Court of

Appeals for the Ninth Circuit seeking review of the conditions in EPA's

final interim approval of Washington's operating permits program.

Western States Petroleum Association, et al. v. EPA, et al., No. 95-

70034 (9th Cir., Jan. 6, 1995). In their petition and subsequent brief,

Petitioners claimed that EPA had exceeded its authority in requiring

Washington to revise its IEU rules as a condition of full approval and

that this condition was arbitrary, capricious, an abuse of discretion,

and not otherwise in accordance with the law. Petitioners' brief

clarified that Petitioners were challenging only EPA's requirement that

Washington revise its IEU rules to obtain full approval and did not

challenge any of the four other conditions for full approval. The State

of Washington filed a brief as intervenor in the matter.

\1\ For the purpose of this action, ``IEU'' refers to activities

and emission units that are defined as insignificant under WAC 173-

401-200(16) and 173-401-530, when used in discussing Washington's

program, and refers to the generic concept under part 70, when used

in discussing the requirements of part 70.

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In reviewing the issue, EPA determined that the Petitioners and the

State of Washington had raised a substantial question concerning EPA's

interpretation of the IEU provisions of part 70 and the specific

regulatory revisions EPA had ordered the State to make to its IEU rules

as a condition of full approval. EPA therefore moved the Court on May

23, 1995, to vacate and remand to EPA those portions of EPA's final

interim approval of Washington's operating permits program concerning

IEUs. The Court granted EPA's motion on July 7, 1995.

Following the Court's order, EPA again reviewed the part 70

regulations and Washington's IEU provisions and, on September 28, 1995,

again proposed interim approval of the State's program (60 FR 50166).

EPA explained in the proposal that EPA continued to believe that

Washington's IEU provisions did not comport with the requirements of

part 70 with respect to permit content because the State's regulations

expressly excluded IEUs subject to generally applicable requirements of

the Washington State Implementation Plan (SIP) from all the

requirements of 40 CFR 70.6, except for the requirement to include in

the permit all applicable requirements. EPA also expressed its concern

that the State's definition of

[[Page 62993]]

IEU excluded, perhaps unintentionally, IEUs from certain permit

application requirements that apply to IEUs and possibly from even

title V applicability determinations.

During the public comment period on the September 1995 proposal,

EPA received comments from the Petitioners, the State of Washington,

Department of Ecology (``State'' or ``Ecology''), and the Boeing

Corporation, an aerospace manufacturing concern with major operations

in Washington State (collectively, the ``commenters''). The commenters

addressed only EPA's proposed interim approval of the Washington IEU

program. No comments were received regarding the change in jurisdiction

of Benton County Clean Air Authority or the correction of the

expiration date for interim approval.

EPA has carefully reviewed the comments and continues to believe

that the Washington IEU program must be revised as a condition of full

approval. As discussed in more detail below, EPA grants deference to

the State's interpretation of its IEU regulations, and is therefore

satisfied, based on the State's interpretation, that the State's IEU

regulations meet the requirements of part 70 with respect to permit

applications and title V applicability. The problems with the permit

content requirements of section 70.6 which EPA addressed in the

September 1995 proposal, however, arise not from a difference of

opinion as to the interpretation of Washington's regulations, but

instead from a difference of opinion as to the plain meaning and intent

of the part 70 regulations themselves. EPA continues to believe that

part 70 does not exempt IEUs subject to applicable requirements from

the testing, monitoring, recordkeeping, reporting, compliance, and

compliance certification requirements of 40 CFR 70.6(a)(1), (a)(3) and

(c). Because Washington's title V program expressly excludes IEUs

subject to generally applicable requirements from these requirements of

section 70.6, EPA continues to believe that the Washington IEU

regulations do not qualify for full approval.

II. Final Action and Implications

A. Response to Comments

As discussed above, the comments addressed only EPA's proposed

interim approval of Washington's IEU regulations.

1. Permit Content

As the State of Washington and Petitioners concede, the Washington

program expressly exempts IEUs subject to generally applicable

requirements from the testing, monitoring, recordkeeping, reporting,

compliance, and compliance certification requirements of section

70.6.2 See WAC 173-401-200(16), 173-401-530(2)(c) and 173-401-

530(2)(d). Instead, for IEUs subject to generally applicable

requirements of the Washington SIP, the Washington program requires

only that the permit contain the generally applicable requirements that

apply to such IEUs. WAC 173-401-530(2)(b). The commenters argue that

the language and intent of the part 70 regulations allow such an

exemption from the permit content requirements of section 70.6 for

IEUs. EPA disagrees.

\2\ This includes the requirement to include ``gapfilling''

testing, monitoring, recordkeeping and reporting requirements for

IEUs, as required by 40 CFR 70.6(a)(3)(i), (ii) and (iii);

compliance certification, testing, monitoring, reporting and

recordkeeping requirements sufficient to assure compliance with the

generally applicable requirements for subject IEUs, as required by

40 CFR 70.6(c)(1); compliance certification for IEUs, as required by

40 CFR 70.6(c)(5); and, for IEUs not in compliance, a compliance

schedule and progress reports, as required by 40 CFR 70.6(c)(3) and

(4).

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The commenters acknowledge that there is no reference in 40 CFR

70.6 to IEUs. They argue, however, that this fact ``in no way

undermines the authority granted to states in section 70.5 to exempt

insignificant emission units from permit program requirements.''

Section 70.5, however, does not exempt IEUs from ``permit program

requirements'' in general, but instead exempts IEUs only from certain

permit application requirements. There is nothing in the language of

section 70.5 or elsewhere in the part 70 regulations to support the

commenters' argument that, because a State may exempt IEUs from certain

permit application requirements in section 70.5, a State may also

exempt IEUs from certain permit content requirements in section 70.6.

The commenters' reliance on EPA's inherent power to exempt emission

units with de minimis emissions from certain permit content

requirements is also misplaced. EPA did indeed rely on Alabama Power

Co. v. Costle, 636 F.2d 323 (D.C. Cir. 1980), to exempt IEUs from

certain permit application requirements in section 70.5. See 57 FR

32250, 32273 (July 21, 1992). Whether EPA could have relied on this

same authority to exempt IEUs from certain permit content requirements

in section 70.6, however, is irrelevant at this point. As stated above,

nothing in the language of the part 70 regulations themselves or in the

preamble to the proposed or final part 70 regulations supports the

commenters' argument that the limited exemption in certain permit

application requirements in section 70.5 also extends to the permit

content requirements of section 70.6. The commenters' concern appears

to be with the part 70 regulations themselves, that is, the failure of

the part 70 regulations to exempt IEUs subject to applicable

requirements from certain permit content requirements of section 70.6.

The time for raising such an issue has long since past.

Unable to point to any language in the part 70 regulations

supporting their interpretation, the commenters rely on ``logic.'' The

commenters first argue that ``it is entirely illogical for EPA to

specifically exempt these IEUs from the application and then attempt to

regulate these same IEUs in the final permit.'' The commenters go on to

state that EPA's decision undermines the broad purpose of part 70's IEU

program exemption. The commenters appear to misunderstand the purpose

and scope of the part 70 program for insignificant emissions units and

activities. In promulgating section 70.5(c), EPA crafted a limited

exemption regarding the information required in part 70 permit

applications. Notwithstanding this general exemption from certain

permit application requirements, section 70.5(c) requires that an

application ``may not omit information needed to determine the

applicability of, or to impose, any applicable requirement.'' This

means that when information is needed in an application to determine

whether substantive requirements apply to an IEU, even this limited

exemption to the permit application requirements provided in section

70.5 falls away.

In a similar vein is the comment that not allowing IEU's to be

exempted from permit content requirements ``essentially obliterates the

exemption.'' EPA disagrees. An emission unit that is not exempted from

the application must be addressed in accordance with section

70.5(c)(3), which among other things requires a physical description of

the emissions points, information about the emissions, raw materials

and production rate, and any air pollution control equipment. EPA

therefore sees no basis for the argument that extension of the IEU

exemption to the permit content requirements of section 70.6 is

necessary in order to give meaning to the IEU exemption.

The commenters also argue that ``If insignificant emission units

are not entirely exempted from the monitoring, recordkeeping, reporting

and certification requirements of a permit, both sources and permitting

agencies will be forced to expend substantial

[[Page 62994]]

resources without compensating environmental benefit.'' As an initial

matter, EPA again points out that this concern challenges the part 70

regulations themselves and should have been raised following final

promulgation of the part 70 regulations. Such concerns are untimely

when raised in the context of EPA's action on Washington's title V

program. In any event, EPA disagrees that applying the testing

monitoring, recordkeeping, reporting, and compliance certification

requirements of section 70.6 to IEUs with applicable requirements will

be unduly burdensome or result in no compensating environmental

benefit.

The commenters imply that requiring the provisions of section 70.6

to be met with respect to IEUs subject to applicable requirements will

result in unnecessary paperwork. As EPA discussed in its September 1995

proposal on this action, part 70 allows States flexibility in tailoring

the amount and quality of information required in the permit

application, and the rigor of compliance requirements in the permit, to

the type of emission unit and applicable requirement in question. See

60 FR 50170; See also White Paper for Streamlined Development of Part

70 Permit Applications, from Lydia Wegman, Deputy Director of EPA's

Office of Air Quality Planning and Standards, to EPA Regional Air

Directors (July 10, 1995). The requirement to include in a permit

testing, monitoring, recordkeeping, reporting, and compliance

certification sufficient to assure compliance with the terms and

conditions of the permit does not require the permit to impose the same

level of rigor with respect to emission units that do not require

extensive testing or monitoring in order to assure compliance with the

applicable requirements as it does with respect to emission units that

do require extensive testing or monitoring because of their potential

to violate emission limitations or other requirements under normal

operating conditions. As provided for in 40 CFR 70.6(a)(3)(B),

recordkeeping may be used to provide reliable data that are

representative of the source's compliance with the permit. For example,

records showing the use of natural gas as the fuel for combustion

sources would, in most cases, provide reliable data for a certification

of compliance with sulfur dioxide emission limits.

The burden of ensuring that a permit meets the requirements of

section 70.6 can also be significantly minimized by using standard

permit terms to address testing, monitoring, recordkeeping, reporting,

compliance and compliance certification requirements for common

generally applicable requirements that apply to IEUs. Permits could,

for example, contain a chart summarizing the monitoring, recordkeeping,

and reporting requirements that would form the basis for compliance

certifications for the generally applicable requirements for IEUs.

In the September 1995 proposal on this action, EPA pointed to the

Oregon operating permits program as an example of a program that had

effectively implemented the requirements of section 70.6 for IEUs. The

Oregon program received interim approval effective January 3, 1995, (59

FR 61820 (December 2, 1994)),3 one month after Washington's

program first received final interim approval. Since that time, Oregon

permitting authorities have received complete title V permit

applications from over 86 sources, have issued 12 final title V permits

and have submitted to EPA an additional 5 proposed title V permits. As

discussed in the September 1995 proposal on this action, Oregon has

used standard permit terms in its title V permits to address generally

applicable requirements for IEUs as well as the associated testing,

monitoring, recordkeeping, reporting, compliance, and compliance

certification requirements for such IEUs. See 60 FR 50170-50171. Based

on EPA's review of public comments on the 5 proposed and 12 final

permits issued to date, Oregon sources have not objected to the permit

terms relating to IEUs.

\3\ Oregon's IEU provisions received full approval when EPA

granted the Oregon title V program final interim approval, see 59 FR

61820 (December 2, 1994), and the entire Oregon title V program has

now received final full approval. See 60 FR 50106 (September 28,

1995).

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EPA is committed to issuing additional guidance to aid State and

local permitting authorities in drafting permits which comply with the

permit content requirements of section 70.6. EPA intends to issue such

guidance with respect to IEUs with applicable requirements within the

next several months. This guidance will address such things as

streamlining the permit by using general conditions which apply to

categories of IEUs; appropriate monitoring, recordkeeping and reporting

requirements for IEUs; and the appropriate level of information (i.e.,

reasonable inquiry) upon which compliance certifications would be

based.

One commenter on the Washington title V program has stated, without

any substantiation, that ``a comparison of title V applications for

similar sources in the two states reveals that Oregon applications were

several times larger than those prepared in Washington, with the

difference attributable to emissions units making up one or two percent

of the source's total emissions.'' Although EPA has to date received

only 16 permit applications from title V sources in Washington, a

comparison of five Washington title V applications to Oregon title V

applications for sources with the same SIC codes does not substantiate

the commenter's claim. Although the Oregon permit applications that EPA

reviewed were generally one-and-one-half times larger than their

Washington counterparts, two of the five Washington applications

contained more pages addressing IEUs and facility-wide applicable

requirements than did their Oregon counterparts and one had the same

number of pages. More importantly, none of these 10 permit applications

for Washington and Oregon contained any significant number of pages

addressing IEUs. The IEU-related portions of the Oregon applications

ranged from 5 to 25 pages and the IEU-related portions of the

Washington applications ranged from 3 to 19 pages. As indicated by the

sample Oregon permit which was included in the docket for the proposal

on this action, and the accompanying application for the permit which

EPA has added to the docket, only 8 of the 165 pages of the permit

application are devoted to IEUs, which includes three pages of

checklists for categorically exempt IEUs, one page of brief

descriptions/equations addressing aggregate insignificant IEUs, two

pages listing facility-wide applicable requirements, and two pages

listing compliance methods for the facility-wide applicable

requirements. Note as well that not even two of the 27 pages of the

Oregon permit for this source are devoted to IEUs. Any difference in

the size of Oregon and Washington title V permit applications appears

to be attributable to the difference in the forms required to be

submitted for emission units other than IEUs and other differences in

the Oregon and Washington air programs, such as the unique plant site

emissions limit (PSEL) provisions of Oregon's rules. In short, Oregon

permitting authorities and sources do not appear to be awash in the

avalanche of paperwork for IEUs predicted by the commenters.

EPA also vigorously disagrees that requiring permits to address the

testing, monitoring, reporting, recordkeeping, compliance, and

compliance certification requirements of section 70.6 for IEUs will

have little or no environmental benefit. For example, the Washington

IEU program lists ``vents

[[Page 62995]]

from rooms, buildings and enclosures that contain permitted emissions

units or activities from which local ventilation, controls and separate

exhaust are provided'' as ``categorically exempt'' IEUs if they are

subject to no applicable requirements other than the generally

applicable requirements of the Washington SIP. WAC 173-401-532(9) and

173-401-530(2)(a). EPA has received a title V application from one

Washington facility which lists ``furnace building roof monitor and

other vents, doorways'' as collectively emitting 922 tons of

particulate per year. The application also indicates that these

emission points are subject only to the generally applicable opacity

limit (WAC 173-400-040(1)), grain loading standard (WAC 173-400-060),

and sulfur dioxide standard (WAC 173-400-040(6)) in the Washington SIP.

Based on the description provided in the application, EPA believes that

these emission units would qualify as IEUs under WAC 173-401-532(9) and

173-401-530(2)(a). The application indicates that these emissions units

are not in compliance with the State's opacity limit. Washington's

current regulations would require that the title V permit for this

source contain the generally applicable requirements that apply to

these IEUs, but would exempt them from any other requirements of

section 70.6, including the requirement to submit an annual compliance

certification. The environmental benefit of requiring the title V

permit for such a source to include an appropriate level of testing,

monitoring, recordkeeping, and reporting, and to require annual

certification of the compliance status of these IEUs, should be

obvious. Requiring IEUs to be addressed in the permit puts the burden

on sources to ensure that they are in compliance with the applicable

requirements, rather than on permitting authorities to document that

such sources are out of compliance. This shift in responsibility for

ensuring compliance is one of the major objectives of the title V

program.

The commenters final comment on the permit content issue is that,

in finding that Washington's IEU regulations fail to meet the permit

content requirements of section 70.6, EPA is holding the Washington

program to a different standard than the agency has applied to other

States. The commenters can point to no instance, however, in which EPA

has given approval to an IEU program which expressly exempts IEUs from

some or all permit content requirements, as does the Washington

program. Instead, the commenters' argument appears to be that EPA has

approved State programs that exempt or require only the summary listing

of IEUs in permit applications and that, ``Because the [IEU] units are

not listed in the permit application there is a clear inference to

sources, and the tacit understanding by the permitting agencies that

IEUs are not included in the operating permit.'' This is not the case.

EPA has approved State title V programs that exempt or allow

sources to omit IEUs from or merely list IEUs in the permit

application, but only if the States have shown to EPA's satisfaction

that their programs meet the two minimum requirements of section

70.5(c) for the treatment of IEUs in permit applications. First,

insignificant activities which are exempt because of size or production

rate must be listed in the permit application. Second, the permit

application may not omit information needed to determine the

applicability of, or to impose, any applicable requirement or any

required fee.4 EPA also required the State of Washington to

satisfy these requirements as a condition of full approval of its IEU

provisions and, as discussed below, EPA now finds that Washington has

satisfied these requirements for permit applications.

\4\ The Wisconsin program does not specifically contain this

requirement. As EPA clarified in its technical support document

supporting EPA's approval of the Wisconsin program, however, because

the State very narrowly defined IEUs and required that all IEUs be

listed in the application, the Wisconsin program met the

requirements of section 70.5(c).

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But, contrary to the commenters' assertion, EPA has also required,

as a condition for full approval of a State's IEU program, that the

State ensure that permits issued for such sources comply with the

requirements of section 70.6 with respect to all IEUs subject to

applicable requirements. EPA disagrees with the inference drawn by the

commenters, namely, that other State programs might be interpreted to

exempt IEU's from permit content requirements because the State

programs have provided sources relief from certain permit application

requirements. Such an inference is not reasonable or appropriate given

the fact that there is no language in the State program regulations

cited by the commenters which contain or suggest an exemption from the

permit content requirements and given the fact that the federal

regulation under which the State programs have been approved does not

allow for this result. Indeed, for obvious reasons, EPA's approval of

these programs has been based on the assumption that State program

regulations will be interpreted in the same way that EPA has

interpreted part 70. That is, where the State program does not

specifically exempt IEU's from permit content requirements, EPA has

assumed that no such exemption will be inferred. Where EPA has been

concerned that a State program could be interpreted to provide an

exemption from permit content requirements for IEUs subject to

applicable requirements, EPA has clarified its expectation in the

Federal Register notice acting on such programs that the permitting

authorities must ensure that all permits issued ``assure compliance

with all applicable requirements at the time of permit issuance.'' See

60 FR 32603, 32608 (June 23, 1995); 60 FR 44799, 44801 (August 29,

1995). If, during implementation of such programs, permits are issued

which do not comply with the requirements of section 70.6 with respect

to IEUs subject to applicable requirements, EPA would consider this

grounds for objecting to individual permits, 40 CFR 70.8(c)(1), as well

as grounds for withdrawing approval of such State programs, 40 CFR

70.10(c)(1)(ii)(B).

In summary, the commenters can point to no instance in which EPA

has approved a State program which expressly exempts IEUs with

applicable requirements from the permit content requirements of section

70.6. Moreover, the commenters can point to no action on the part of

EPA which has expressly or implicitly condoned a tacit exemption from

the permit content requirements for such IEUs. EPA's decision to grant

interim rather than full approval to the Washington IEU regulations for

failing to comply with the requirements of section 70.6 is fully

consistent with EPA's actions on other State IEU programs.

2. Permit Application Requirements

The commenters also objected to EPA's proposed finding that the

Washington regulations fail to meet the requirements of section 70.5

for permit applications with respect to IEUs. The basis of EPA's

position was that WAC 173-401-200(16) appears to specifically exempt

activities and units deemed insignificant under WAC 173-401-530 from

all of Washington's permit program requirements, except as provided in

WAC 173-401-530. WAC 173-401-530, however, does not include all of the

requirements of section 70.5 which a State must meet with respect to

IEUs, most importantly, the requirement of section 70.5(c) that a

permit application may not omit information needed to determine the

applicability or to impose any

[[Page 62996]]

applicable requirement or to evaluate any required fee (the

``applicable requirements gatekeeper'').5 WAC 173-401-530 also

does not incorporate the requirement that all applications be certified

as to truth, accuracy and completeness, which is contained in WAC 173-

401-500(7)(c) and 173-401-520. Another problem noted by EPA was the

fact that WAC 173-401-500(7) could be interpreted as allowing a permit

application to be deemed complete even if the source had not provided

the information in the permit application required by Washington's

regulations for IEUs.

\5\ Although, in the September 1995 proposal on this action, EPA

did not specifically discuss the applicable requirements gatekeeper

as one of the examples where the Washington program fails to satisfy

the requirements of part 70 with respect to permit applications, the

opening sentence of the discussion in the proposal on permit

applications clearly expressed EPA's concern that the exemption in

WAC 173-401-200(16) appeared to extend to the gatekeeper itself,

which is contained in WAC 173-401-510(1). See 60 FR 50169.

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The commenters, including the State of Washington, responded that

EPA was taking an overly broad interpretation of the exclusion

contained in WAC 173-401-200(16), thereby giving other provisions of

Washington's IEU regulations no effect. Upon further review and based

on the State's interpretation of its regulations, EPA finds that the

Washington IEU provisions meet the requirements of section 70.5(c).

The definition of IEU at WAC 173-401-200(16) does appear to exclude

IEUs from all requirements except those contained in WAC 173-401-530.

Certain other requirements of Washington's regulations for title V

permit applications, however, specifically refer to IEUs. Importantly,

WAC 173-401-510, which sets forth the permit application requirements

for all sources in Washington, specifically refers to IEUs by stating:

Information as described below for each emissions unit at a

chapter 401 source other than insignificant emissions units shall be

included in the application. However, an application may not omit

information need to determine the applicability of, or to impose,

any applicable requirement or to evaluate the fee amount required

under the permitting authority's schedule.

WAC 173-401-510(1). The State has argued that this provision would be

nullified if WAC 173-401-200(16) was interpreted to exempt IEUs from

those provisions outside of WAC 173-401-530 that specifically refer to

IEUs, such as 173-401-510(1). The State has assured EPA that this was

not its intent. Instead, the State has stated that the ``applicable

requirements gatekeeper'' of WAC 173-401-510(1) was specifically

included to limit the statements in WAC 173-401-200(16) and 173-401-

510(1) that IEUs are not subject to the permit program requirements,

including the application requirements, except as provided by WAC 173-

401-530.

In response to the EPA's concern with respect to the requirement to

certify the truth, accuracy and completeness of the permit application,

the commenters state that ``Statements in a Washington operating permit

application, including those regarding IEUs made in accordance with WAC

173-401-530, are plainly subject to the certification requirements of

WAC 173-401-500(7)(c).'' The State further argues that the State's

standard permit application form requires certification of all

information in the application and that if a source attempted to limit

its certification with respect to IEUs, the State would view the

application incomplete.

In response to EPA's concern that the criteria for determining

completeness in WAC 173-401-500(7) could be interpreted to allow an

application to be deemed complete even if it omits all required

information on IEUs, the commenters again point out that the specific

provisions in WAC 173-401-510(1) and -500(4) require an application to

include necessary information regarding IEUs to be complete and that

interpreting WAC 173-401-200(16) to vitiate those provisions would

render the specific references to IEUs in WAC 173-401-500 and 173-401-

510 meaningless.

Although EPA believes the interrelationship among the various

provisions in Washington's regulations for IEUs is far from clear, EPA

is willing to grant deference to the State's interpretation of its own

rules. Accordingly, EPA now finds that Washington's program fully meets

the requirements of 40 CFR 70.5 regarding permit applications. Because

the State will need to revise its title V rules to get full title V

approval, EPA strongly encourages the State to revise its IEU

provisions to clarify the relationship among WAC 173-401-200(16), 173-

401-500, 173-401-510, 173-401-520 and 173-401-530. EPA will also pay

close attention during program implementation to permit applications

and proposed permits to ensure that the Washington rules are

implemented consistently with the State's assertions.

3. Applicability Determinations

A final concern raised by EPA was that State law could be

interpreted so as to exclude emissions from IEUs in the calculation of

a source's potential to emit for purposes of determining whether the

source was a major source and thereby subject to Washington's title V

program in the first instance. Again, EPA's concern hinged on the

extent of the exemption in WAC 173-401-200(16). The commenters

responded by pointing out that the definition of ``insignificant

activity'' or ``insignificant emission unit'' requires the unit or

activity to be ``located at a chapter 401 source'' before it can

qualify as insignificant and thus be exempted from certain permit

program requirements. The commenters argue that this requires that a

source first be determined to be a major source before any emission

unit can be deemed insignificant, thus requiring all emissions,

including emissions from IEUs, to be considered when determining if a

source is a major source.

Again, EPA is willing to grant deference to the State's

interpretation of its own rules and finds that this provision complies

with the requirements of 40 CFR Part 70. EPA will also pay close

attention to applicability determinations during program implementation

to ensure that the Washington rules are implemented consistently with

the State's assertions.

B. Interim Approval Action

EPA is promulgating interim approval of Washington's regulations

addressing IEUs. Ecology must make the following revisions to its IEU

provisions as a condition of full approval:

(5) Revise WAC 173-401-200(16) (Definition of ``insignificant

activity'' and ``insignificant emissions unit''); WAC 173-401-530

(Insignificant emission units); WAC 173-401-532 (Categorically

exempt insignificant emission units); and WAC 173-401-533 (Units and

activities defined as insignificant based on size or production

rate) to ensure that permits contain all applicable requirements and

meet all permit content requirements of 40 CFR 70.6 for all emission

units, even for IEUs.

This requirement replaces Condition 5 under the heading ``Ecology''

in section II.B. of EPA's November 9, 1994, Federal Register notice

granting final interim approval of the Washington operating permits

program. See 59 FR 55818. Note that this action in no way affects the

changes necessary to address all other interim approval issues

identified in the November 9, 1994 Federal Register notice. In other

words, as a condition of full approval, Washington must also correct

the four other deficiencies in its program identified in the November

9, 1994, notice and the other Washington permitting authorities must

correct all

[[Page 62997]]

deficiencies in their respective programs identified in the November 9,

1994, notice. See 59 FR 55818-55819.

EPA is also approving as a program revision the transfer of title V

permitting and enforcement authority for sources in Franklin County to

the Washington Department of Ecology.

Finally, EPA is correcting the dates in 40 CFR Part 70, Appendix A

for expiration of the interim approval of the Washington State and

local operating permits programs from November 9, 1996, to December 9,

1996, and is correcting the date by which the State is required to

submit a corrective program from May 9, 1996, to June 9, 1996.

C. Effective Date of Interim Approval

This action does not change the time period for the initial interim

approval, which is December 9, 1996. During this ongoing interim

approval period, the State is protected from sanctions for failure to

have a program, and EPA is not obligated to promulgate, administer and

enforce a Federal permits program for the State of Washington. Permits

issued under the Washington program have full standing with respect to

part 70. In addition, the 1-year deadline for submittal of permit

applications by subject sources and the 3-year time period for

processing the initial permit applications began upon the effective

date of interim approval, which in this case was December 9, 1994.

If the State of Washington were to fail to submit a complete

corrective program for full approval by the date 6 months before

expiration of the interim approval (by June 9, 1996) EPA would start an

18-month clock for mandatory sanctions. If the State of Washington were

then to fail to submit a complete corrective program 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 State of Washington had corrected

the deficiency by submitting a complete corrective program. Moreover,

if the Administrator were to find a lack of good faith on the part of

the State of Washington both sanctions under section 179(b) would apply

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

determined that the State of Washington had come into compliance. In

any case, if, 6 months after application of the first sanction, the

State of Washington still had not submitted a corrective program that

EPA found complete, a second sanction would be required.

If, following expiration of final interim approval, EPA were to

disapprove the State of Washington'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 State or Washington had submitted a revised

program and EPA had determined that it corrected the deficiencies that

prompted the disapproval. Moreover, if the Administrator found a lack

of good faith on the part of the State of Washington both sanctions

under section 179(b) would apply after the expiration of the 18-month

period until the Administrator determined that the State of Washington

had come into compliance. In all cases, if, 6 months after EPA applied

the first sanction, the State of Washington had not submitted a revised

program that EPA had determined corrected the deficiencies that

prompted disapproval, 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 has not

timely submitted a complete corrective program or EPA has disapproved a

submitted 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 permit's program for that

State upon expiration of interim approval.

III. Administrative Requirements

A. Docket

Copies of the State's submittal and other information relied upon

for this action 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 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 permits programs submitted

to satisfy the requirements of 40 CFR part 70. Because this proposed

action does not impose any new requirements, it does not have a

significant impact on a substantial number of small entities.

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 action proposed 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 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.

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

Final Interim Approval of the part 70 operating permits program for

the Washington Department of Ecology, the Washington Energy Facility

Site Evaluation Council, the Benton County Clean Air Authority, the

Northwest Air Pollution Authority, the Olympic Air Pollution Control

Authority, the Puget Sound Air Pollution Control Agency, the Spokane

County Air Pollution Control Authority, the Southwest Air Pollution

Control Authority, and the Yakima County Clean Air Authority.

Dated: November 15, 1995.

Chuck Clarke,

Regional Administrator.

PART 70--[AMENDED]

Part 70, chapter I, title 40 of the Code of Federal Regulations is

amended as follows:

[[Page 62998]]

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

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

2. Part 70 is amended by revising the Washington paragraph of

Appendix A as follows:

Appendix A--Approval Status of State and Local Operating Permits

Programs

* * * * *

Washington

(a) Department of Ecology (Ecology): submitted on November 1,

1993; effective on December 9, 1994; interim approval expires

December 9, 1996.

(b) Energy Facility Site Evaluation Council (EFSEC): submitted

on November 1, 1993; effective on December 9, 1994; interim approval

expires December 9, 1996.

(c) Benton County Clean Air Authority (BCCAA): submitted on

November 1, 1993 and amended on September 29, 1994 and April 12,

1995; effective on December 9, 1994; interim approval expires

December 9, 1996.

(d) Northwest Air Pollution Authority (NWAPA): submitted on

November 1, 1993; effective on December 9, 1994; interim approval

expires December 9, 1996.

(e) Olympic Air Pollution Control Authority (OAPCA): submitted

on November 1, 1993; effective on December 9, 1994; interim approval

expires December 9, 1996.

(f) Puget Sound Air Pollution Control Agency (PSAPCA): submitted

on November 1, 1993; effective on December 9, 1994; interim approval

expires December 9, 1996.

(g) Southwest Air Pollution Control Authority (SWAPCA):

submitted on November 1, 1993; effective on December 9, 1994;

interim approval expires December 9, 1996.

(h) Spokane County Air Pollution Control Authority (SCAPCA):

submitted on November 1, 1993; effective on December 9, 1994;

interim approval expires December 9, 1996.

(i) Yakima County Clean Air Authority (YCCAA): submitted on

November 1, 1993 and amended on September 29, 1994; effective on

December 9, 1994; interim approval expires December 9, 1996.

* * * * *

[FR Doc. 95-29994 Filed 12-7-95; 8:45 am]

BILLING CODE 6560-50-P