Regulation of Fuels and Fuel Additives: Extension of the Reformulated Gasoline Program to Moderate Ozone Nonattainment Areas in Wisconsin

ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 80

[AMS-FRL-5134-5]

Regulation of Fuels and Fuel Additives: Extension of the

Reformulated Gasoline Program to Moderate Ozone Nonattainment Areas in

Wisconsin

AGENCY: Environmental Protection Agency (EPA).

ACTION: Direct final rule.

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SUMMARY: Under section 211(k)(6) of the Clean Air Act, as amended

(Act), the Administrator of EPA shall apply the prohibition against the

sale of gasoline that has not been controlled under EPA's reformulated

gasoline (RFG) regulations in an ozone nonattainment area upon the

application of the governor of the state in which the nonattainment

area is located. This action extends the prohibition set forth in

section 211(k)(5) of the Act to three moderate ozone non-attainment

areas in Wisconsin, including those counties in the federal RFG

program. In Phase I beginning on January 1, 1995, reformulated gasoline

will achieve a 15 to 17 percent reduction in both ozone-forming

volatile organic compound (VOC) emissions and toxics emissions from

motor vehicles. In Phase II beginning on January 1, 2000, the program

will achieve a 25 to 29 percent VOC reduction, a 20 to 22 percent

reduction in toxics emissions, and a 5 to 7 percent nitrogen oxide

(NOX) reduction.

EFFECTIVE DATES: This action will be effective on March 13, 1995 unless

notice is received by February 10, 1995 that adverse or critical

comments will be submitted or that an opportunity to submit such

comments at a public hearing is requested.

If such comments or a request for a public hearing are received by

the Agency, then EPA will publish a subsequent Federal Register notice

withdrawing this action and will issue a notice of proposed rulemaking.

ADDRESSES: Interested parties may submit written comments (in

duplicate, if possible) to Public Docket No. A-94-46, at Air Docket

Section, U.S. Environmental Protection Agency, Waterside Mall, Room M-

1500, 401 M Street SW., Washington, DC 20460. The Agency requests that

commenters also send a copy of any comments to Joann Jackson Stephens

at U.S. EPA (RDSD-12), Regulation Development and Support Division,

2565 Plymouth Road, Ann Arbor, MI 48105.

Other materials relevant to the RFG rulemaking, and hence today's

action, are contained in Public Docket Nos. A-91-02, A-92-12, A-93-49,

and A-94-30. These dockets are also located in Waterside Mall at the

above listed address. The dockets may be inspected from 8:00 a.m. until

4:00 p.m. Monday through Friday. A reasonable fee may be charged by EPA

for copying docket materials.

FOR FURTHER INFORMATION CONTACT: Joann Jackson Stephens, Telephone:

(313) 668-4276.

To request copies of this action contact Delores Frank, U.S. EPA

(RDSD-12), Regulation Development and Support Division, 2565 Plymouth

Road, Ann Arbor, MI 48105. Telephone: (313) 668-4295.

SUPPLEMENTARY INFORMATION: A copy of this action is available on the

EPA's Office of Air Quality Planning and Standards (OAQPS) Technology

Transfer Network Bulletin Board System (TTNBBS). The service is free of

charge, except for the cost of the phone call. The TTNBBS can be

accessed with a dial-in phone line and a high-speed modem per the

following information:

TTN BBS: 919-541-5742

(1200-14400 bps, no parity, 8 data bits, 1 stop bit),

Voice Help-line: 919-541-5384,

Accessible via Internet: TELNETttnbbs.rtpnc.epa.gov,

Off-line: Mondays from 8:00 AM to 12:00 Noon ET

When first signing on, the user will be required to answer some

basic informational questions for registration purposes. After

completing the registration process, proceed through the following

series of menus:

GATEWAY TO TTN TECHNICAL AREAS (Bulletin Boards)

OMS

Rulemaking and Reporting

Fuels

Reformulated gasoline

A list of ZIP files will be shown, all of which are related to the RFG

rulemaking process. To download any file, type the instructions below

and transfer according to the appropriate software on your computer:

ownload, rotocol, xamine, ew, ist, or elp

Selection or to exit: D filename.zip

You will be given a list of transfer protocols from which you must

choose one that matches with the terminal software on your own

computer. The software should then be opened and directed to receive

the file using the same protocol. Programs and instructions for de-

archiving compressed files can be found via

[[Page 2694]]

ystems Utilities from the top menu, under rchivers/de-archivers.

After getting the files you want onto your computer, you can quit the

TTN BBS with the oodbye command. Please note that due to differences

between the software used to develop the document and the software into

which the document may be downloaded, changes in format, page length,

etc. may occur.

I. Background

As part of the Clean Air Act Amendments of 1990, Congress added a

new subsection (k) to section 211 of the Clean Air Act. Subsection (k)

prohibits the sale of gasoline that EPA has not certified as

reformulated in the nine worst ozone nonattainment areas beginning

January 1, 1995. EPA published final regulations for the RFG program on

February 16, 1994 and on August 2, 1994. See 59 FR 7716 and 59 FR

39258. Corrections and clarifications to the final RFG regulations were

published July 20, 1994. See 59 FR 36944.

Section 211(k)(10)(D) defines the areas covered by the RFG program

as the nine ozone nonattainment areas having a 1980 population in

excess of 250,000 and having the highest ozone design values during the

period 1987 through 1989. Applying those criteria, EPA has determined

the nine covered areas to be the metropolitan areas including Los

Angeles, Houston, New York City, Baltimore, Chicago, San Diego,

Philadelphia, Hartford and Milwaukee. Under section 211(k)(10)(D), any

area reclassified as a severe ozone nonattainment area under section

181(b) is also to be included in the RFG program.

Any other ozone nonattainment area may be included in the program

at the request of the Governor of the state in which the area is

located. Section 211(k)(6)(A) provides that upon the application of a

Governor, EPA shall apply the prohibition against the retail sale of

conventional gasoline (gasoline EPA has not certified as reformulated)

in any area requested by the Governor which has been classified under

subpart 2 of Part D of Title I of the Act as a Marginal, Moderate,

Serious or Severe ozone nonattainment area.\1\ Subparagraph

211(k)(6)(A) further provides that EPA is to apply the prohibition at

the retail level as of the date the Administrator ``deems appropriate,

not later than January 1, 1995, or 1 year after such application is

received, whichever is later.'' In some cases the effective date may be

extended for such an area as provided in section 211(k)(6)(B) based on

a determination by EPA that there is ``insufficient domestic capacity

to produce'' reformulated gasoline. Finally, EPA is to publish a

governor's application in the Federal Register. To date, EPA has

received and published applications from the Mayor of the District of

Columbia and the Governors of Connecticut, Delaware, Maine, Maryland,

Massachusetts, New Hampshire, New Jersey, New York, Pennsylvania, Rhode

Island, Vermont, Virginia, Texas, and Kentucky. Although Vermont has

requested to opt-in to the program, states without ozone nonattainment

areas, such as Vermont, can not do so.

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\1\ EPA promulgated such designations pursuant to Section

107(d)(4) of the Act (56 FR 56694; November 6, 1991).

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II. The Governor's Request

EPA received an application from the Honorable Tommy G. Thompson,

Governor of the state of Wisconsin, for three moderate ozone non-

attainment areas to be included in the RFG program. Governor Thompson

later clarified his request in reference to implementation dates with

the submission of a second letter of application. Both letters are set

out in full below.

A. Initial Letter From Wisconsin's Governor

[State of Wisconsin letterhead]

April 6, 1994.

Carol Browner,

USEPA Administrator,

USEPA Headquarters,

401 M Street, SW (101),

Washington, DC 20460

Dear Ms. Browner: The purpose of this letter is to request that

you extend the requirement for reformulated gasoline to the three

moderate ozone nonattainment areas in Wisconsin. As you know,

Section 211(k)(6) of the Clean Air Act gives the Governor the

authority to opt into the reformulated gasoline program for ozone

nonattainment areas that are not otherwise required to use

reformulated gasoline. I am exercising the opt-in provision of

Section 211(k)(6) for the three moderate ozone nonattainment areas

in Wisconsin; Kewaunee, Manitowoc and Sheboygan Counties.

Reformulated Gasoline is a significant component of our 15

percent VOC emission reduction plans for our moderate nonattainment

areas, supplying about \1/2\ of the necessary emission reductions.

After evaluating the public input to our 15 percent VOC plan, I am

convinced that reformulated gasoline is critical to the success of

the 15 percent plan in our moderate ozone nonattainment areas.

Thank you for considering my request. I am looking forward to

the successful implementation of our 15 percent emission reduction

plan and a good start to achieving our goals of attainment of the

ozone air quality standard in Eastern Wisconsin.

Sincerely,

Tommy G. Thompson,

Governor.

B. Second Letter From Wisconsin's Governor

[State of Wisconsin letterhead]

August 2, 1994.

Carol Browner,

USEPA Administrator,

USEPA Headquarters,

401 M Street, SW (101),

Washington, DC 20460

Dear Ms. Browner: In April of this year I requested that you

extend the federal reformulated gasoline program to the three

Wisconsin moderate ozone nonattainment counties of Sheboygan,

Manitowoc, and Kewaunee. Your staff subsequently notified the state

of the need to clarify the requested effective date for the program

within those counties. I understand the program in our six severe

ozone counties automatically commences January 1, 1995 based on

federal regulation.

Given the summer ozone air quality rationale of the program, I

request that the three county opt-in become effective for gasoline

blended to meet summer season requirements for 1995. Based on staff

meetings with the gasoline refining and wholesale/retail

distribution industry, I recommend a June 1, 1995 retail level

compliance date. The slight start-up delay for the moderate counties

will provide suppliers time to respond to the recently altered

market structure.

Thank you for your attention in this regard. I hope this overall

program will significantly affect air quality improvement in eastern

Wisconsin.

Sincerely,

Tommy G. Thompson,

Governor.

cc: Don Theiler, Air Management, WI-DNR,

Richard Rykowski, Motor Vehicle Emission Lab, USEPA, Ann Arbor, MI

48105

III. Action

Pursuant to the governor's letter and the provisions of section

211(k)(6), the prohibitions of subsection 211(k)(5) will be applied to

the Wisconsin moderate 2 ozone non-attainment areas of Kewaunee,

Manitowoc, and Sheboygan counties beginning June 1, 1995. As of that

date they will be treated as covered areas for all purposes of the

federal RFG program.

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\2\ See 56 FR 56764 (November 6, 1991); 57 FR 56762, 56778

(November 30, 1992); and 40 CFR 81.350.

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The application of the prohibitions of Section 211(k)(5) to the

Wisconsin moderate ozone nonattainment areas at the retail level could

take effect no later than August 2, 1995 under section 211(k)(6)(A)

which stipulates that the effective program date must be no ``later

[[Page 2695]]

than January 1, 1995 or 1 year after such application is received,

whichever is later''. EPA considers the date of the second letter from

the Governor as the effective date of the application, as that letter

first expresses when Wisconsin would like the program to start and

clarifies the Governor's original letter. Additionally, EPA expects

there to be sufficient domestic supply of RFG and therefore has no

current reason to delay implementation of the program in Wisconsin

beyond August 2, 1995.

For those nonattainment areas in Wisconsin, EPA could establish the

start of the RFG program at the retail level anytime between January 1,

1995 and August 2, 1995. However, the Agency believes that any

effective date for the retail level prior to June 1, 1995 is

inappropriate for the following reasons. First, an effective date of

January 1, 1995 for the RFG program in Wisconsin would not provide

sufficient notice to relevant parties. In addition, implementation of

the RFG program in Wisconsin later than January 1, 1995 but earlier

than June 1, 1995 would require that winter RFG be sold at the retail

level for a brief period before summer VOC-control requirements would

become effective. As stated in the Governor's letter, Wisconsin

officials are primarily concerned with the benefits derived from VOC-

controlled RFG which is required June 1, 1995. Thus, EPA believes that

an effective date of June 1, 1995 is suitable for Wisconsin since it is

consistent with the beginning of the RFG summer VOC control season and

with the request in Governor Thompson's letter.

Requiring that the RFG program begin at the onset of the VOC-

control season, as requested by Governor Thompson, addresses concerns

raised by wholesale/retail distributors to Wisconsin officials

regarding the unwillingness of refiners which normally sell gasoline in

Wisconsin to supply RFG to a geographic area which is so small and that

is such a substantial distance from the nearest RFG market. Wisconsin

officials believe that the June 1 effective date will provide the

gasoline distribution industry with the necessary lead-time to

establish storage and cross sales agreements with refiners (other than

those which already market fuel in the area) willing to sell RFG in the

three county moderate ozone nonattainment area. Such storage and cross

sales agreements will facilitate the sale of reformulated gasoline,

which will aid Wisconsin in meeting its statutory 15 percent reduction

requirements. In addition, as expressed in the Governor's letter, the

main interest in opting into this program is based on a belief that the

state air quality would most benefit from the summer season

reformulated gasoline.

RFG VOC-control compliance at the terminal in Wisconsin should be

consistent with the final regulatory requirements for the RFG program.

Thus, compliance by parties upstream of retail outlets, in Wisconsin,

will be effective May 1, 1995. As in the federal volatility program,

such an effective date for upstream parties such as terminals is

necessary to ensure compliance at the retail level by requiring that

RFG be in the pipeline (upstream) prior to June.

IV. Public Participation and Effective Date

The Agency is publishing this action as a direct final rule because

it views the addition of the three ozone nonattainment areas in

Wisconsin to the RFG program as non-controversial and anticipates no

adverse or critical comments. Representatives from the state of

Wisconsin have met with refiners that supply the majority of the

state's fuel, including those refiners willing to supply RFG to the

moderate ozone nonattainment areas, and the parties apparently agree

that the on-set of the VOC-control season is an appropriate time to

begin implementation of the RFG program. Thus, interested parties

appear to agree on the June 1, 1995 date.

This action will be effective on March 13, 1995 unless the Agency

receives notice by February 10, 1995 that adverse or critical comments

will be submitted, or that a party requests the opportunity to submit

such oral comments pursuant to section 307(d)(5) of the Clean Air Act,

as amended. If such notice or comments are received regarding the

addition of the moderate ozone nonattainment areas in Wisconsin to the

RFG program, today's action will be withdrawn before the effective date

by the publication of a subsequent withdrawal notice in the Federal

Register. In the event that today's direct final rule is withdrawn as a

result of the submission of adverse or critical comments or a request

to present such comments at a public hearing, the Agency will issue a

notice of proposed rulemaking to extend the RFG program to the three

moderate ozone nonattainment counties in Wisconsin.

V. Statutory Authority

The statutory authority for the action finalized today is granted

to EPA by Sections 114, 211(c) and (k) and 301 of the Clean Air Act, as

amended; 42 U.S.C. 7414, 7545(c) and (k), and 7601.

VI. Administrative Designation

Pursuant to Executive Order 12866, [58 FR 51,735 (October 4, 1993)]

the Agency must determine whether the regulatory action is

``significant'' and therefore subject to OMB review and the

requirements of the Executive Order. Pursuant to the terms of Executive

Order 12866, it has been determined that this direct rule is not a

``significant regulatory action''.

VII. Regulatory Flexibility Analysis

The Regulatory Flexibility Act (RFA) of 1980 requires federal

agencies to examine the effects of extending the RFG program to three

moderate ozone nonattainment areas in Wisconsin and to identify

significant adverse impacts of federal regulations on a substantial

number of small entities. Because the RFA does not provide concrete

definitions of ``small entity,'' ``significant impact,'' or

``substantial number,'' EPA has established guidelines setting the

standards to be used in evaluating impacts on small businesses. For

purposes of the RFG program, a small entity is any business which is

independently owned and operated and not dominant in its field as

defined by SBA regulations under section 3 of the Small Business Act.

The Agency believes that the extension of the RFG program to the

three ozone nonattainment areas in Wisconsin is unlikely to have a

significant economic impact on a substantial number of small entities.

Pursuant to section 605(b) of the Regulatory Flexibility Act, 5 U.S.C.

605(b), the Administrator certifies that this rule will not have a

significant economic impact on a substantial number of small entities.

List of Subjects in 40 CFR Part 80

Environmental protection, Fuel additives, Gasoline, Imports,

Labeling, Motor vehicle pollution, Penalties, Reporting and

recordkeeping requirements.

Dated: December 29, 1994.

Carol M. Browner,

Administrator.

40 CFR part 80 is amended by making the following revisions:

PART 80--REGULATION OF FUELS AND FUEL ADDITIVES

1. The authority citation for part 80 continues to read as follows:

Authority: Sections 114, 211 and 301(a) of the Clean Air Act as

amended (42 U.S.C. 7414, 7545 and 7601(a)).

In Sec. 80.70, paragraphs (l) and (l)(1) are added to read as

follows:

[[Page 2696]]

Sec. 80.70 Covered areas.

* * * * *

(l) The ozone nonattainment areas listed in this paragraph (l) are

covered areas beginning on May 1, 1995 at the terminal. No requirements

under subpart D shall apply to gasoline at a retail outlet or at the

facilities of a wholesale purchaser/consumer until June 1, 1995. The

geographic extent of each covered area listed in this paragraph (l)

shall be the nonattainment boundaries as specified in 40 CFR part 81,

subpart C:

(1) The following Wisconsin counties:

(i) Kewaunee;

(ii) Manitowoc;

(iii) Sheboygan.

(2) [Reserved]

[FR Doc. 95-420 Filed 1-10-95; 8:45 am]

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