Clean Air Act Proposed Full Approval of Operating Permits Program: The United States Virgin Islands

ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 70

[VIOO1; FRL-5403-2]

Clean Air Act Proposed Full Approval of Operating Permits

Program: The United States Virgin Islands

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

ACTION: Proposed full approval.

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SUMMARY: The EPA proposes full approval of the operating permits

program submitted by the United States Virgin Islands 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.

DATES: Comments on this proposed action must be received in writing by

February 26, 1996. Written comments should be addressed to Steven C.

Riva, Chief, Permitting and Toxics Support Section, at the New York

Region II Office listed below.

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

information used in developing the proposed full approval are available

for inspection during normal business hours at the following locations:

EPA Region II, 290 Broadway, 21st Floor, New York, New York 10007-

1866, Attention: Steven C. Riva.

EPA Region II, Caribbean Field Office, Centro Europa Building,

Suite 417, 1492 Ponce de Leon Avenue, Stop 22, San Juan, Puerto Rico

00907-4127, Attention: Jose Ivan Guzman.

The U.S. Virgin Islands Department of Planning and Natural

Resources, Division of Environmental Protection, Building 111,

Apartment 14A, Water Gut Homes, Christainsted, St. Croix, U.S. Virgin

Islands 00820. Attention: Leonard Reed.

FOR FURTHER INFORMATION CONTACT: Umesh Dholakia, Permitting and Toxics

Support Section, at the above EPA office in New York or at telephone

number (212) 637-4023.

SUPPLEMENTARY INFORMATION:

I. Background and Purpose

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

amended in 1990, 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,

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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. The EPA's

program review occurs pursuant to Section 502 of the Act and the Part

70 regulations, which together outline criteria for approval or

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

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

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

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

program, it must establish and implement a Federal program.

II. Proposed Action and Implications

A. Analysis of State Submission

1. Support Materials

The Governor of the United States Virgin Islands submitted a Part

70 permitting program for the U.S. Virgin Islands with a letter

requesting EPA's approval on November 18, 1993 and supplemental

packages through June 9, 1995. The program contains a description of

how the Virgin Islands intends to implement the program consistent with

the requirements of the Clean Air Act Amendments of 1990 (42 U.S.C.

Secs. 7401-7671q) and 40 CFR Part 70. The program includes supporting

documentation such as evidence of the procedurally correct adoption of

the permitting rule, permit application forms, and a sample permit

form. On May 15, 1995, the Attorney General of the U.S. Virgin Islands

submitted a legal opinion stating that the Virgin Islands Department of

Planning and Natural Resources (VIDPNR) has adequate legal authority to

carry out the program. It should be noted that the Virgin Islands'

program contains some wording errors and as such the Virgin Islands has

agreed to correct those errors prior to final approval. These wording

errors in the Virgin Islands' legislation (Act No. 6011 signed into law

September 2, 1994) are:

(1) Section 212(a) states that ``No rule or regulation and no

amendment * * * shall take effect AFTER public comment and/or hearing

on due notice as provided herein''. The word ``after'' should be

replaced by the word ``without''.

(2) Section 205 (a), (b) (1) and (2)--replace ``chapter'' with

``with respect to Part 70 permit program''.

(3) Section 215(a)--delete ``compliance order'' and replace with

``notice of violation'' after ``Commissioner is authorized to issue * *

*''

(4) Section 215(b)(3)--There should be an additional sentence

following ``$250,000''. ``The assessment of any administrative fine in

excess of $250,000 may be enforced by the commencement of a civil

action by the Attorney General pursuant to the Virgin Islands Law.

2. Regulations and Program Implementation

The Virgin Islands' Part 70 permitting regulation is contained in

Subchapter 204 and Subchapter 206 (Divisions 1 and 2) of the Virgin

Islands Rules and Regulations, Title 12, Chapter 9 (RAR). The Virgin

Islands' regulation meets the main requirements of Part 70 as described

below:

a. applicability (40 CFR 70.2 and 70.3): Sources required to obtain

a permit under the Virgin Islands' regulation are defined as ``Part 70

sources'' and include all major Part 70 sources. The rule defers non-

major sources until the Administrator completes a rulemaking to

determine how the title V program should be structured for non-major

sources and the appropriateness of any permanent exemptions. The

regulation permanently exempts any source that would be required to

obtain a permit solely because it is subject to Standards of

Performance for New Residential Wood Heaters or the National Emission

Standard for Hazardous Air Pollutants for Asbestos, Standards for

Demolition and Renovation. The regulation provides for the R&D

Facilities to be treated separately with the concurrence of the

Commissioner. In as much as the Commissioner will be in a position to

determine whether or not the facility meets the support facility test

this does not constitute an approvability issue.

b. permit content (40 CFR 70.6): Subchapter 206-71 requires that

each permit contain emission limitations and standards to ensure

compliance with all applicable requirements. Permits may also contain

certain operational flexibility requirements such as terms and

conditions for reasonably anticipated operating scenarios and for the

trading of emissions increases and decreases (to the extent the

applicable requirements provided for such trading) in the permitted

facility. Such operational flexibility provisions are explained more

fully in Subchapter 206-65 of the RAR.

c. public participation (40 CFR 70.7): The public will be provided

with notice of, and an opportunity to comment on, draft permits

relating to initial permit issuance, permit renewals, and significant

modifications (Subchapter 206-73 of the RAR).

d. permit modifications (40 CFR 70.7): Sources may apply for

expedited permit changes for minor permit modifications. Significant

modifications must undergo all Part 70 permit issuance procedures

(Subchapter 206-82 of the RAR).

e. EPA oversight (40 CFR 70.8): Each permit, renewal, and minor or

significant modification is subject to EPA oversight and veto

(Subchapter 206-73 of the RAR).

f. enforcement authority (40 CFR 70.11): Chapter 9 of Title 12 of

the Virgin Islands Code, pertaining to the air pollution control and

related purposes (VI's Act # 6011) as amended on September 2, 1994

directly provides for enforcement and penalties for civil and criminal

violations of permits and rules. Penalties will be assessed up to

$50,000 per day per violation for civil violations, and up to $10,000

per day per violation for criminal violations.

g. insignificant activities (40 CFR 70.5): A list of insignificant

activities can be found at Attachment 1 of the RAR. Insignificant

activities which need not be described in the permit application only

include activities on the list as long as no applicable requirements

apply to the activity and the activity emits 0.05 pounds per year or

less of a criteria pollutant or 400 pounds per year or less of the

hazardous air pollutants. However, for insignificant activities

exempted because of size or production rate, the RAR requires that a

list of such insignificant activities must be included in the permit

application.

h. complete application forms (40 CFR 70.5): DPNR submitted a

permit application completeness criteria checklist which will be used

to help DPNR determine if an application is complete. Subchapter 206-63

defines what elements must be in an application in order for it to be

complete.

i. variance provisions: Section 211 of Title 12, Chapter 9 of the

Virgin Islands Code (statute) contains provisions for DPNR to approve

variances from otherwise applicable emissions limitations, provided

such variances are permitted under conditions and in a manner which is

not less stringent than the conditions under and the manner in which

variances may be granted under the federal Clean Air Act. Any such

variance shall not excuse compliance with any Title V permit term or

condition. A variance from a federal condition must be processed as a

Title V permit condition. The Commissioner

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of the DPNR may not authorize a variance which concerns a Federal Clean

Air Act requirement and SIP requirements. Under Subchapter 206-71 of

the RAR, DPNR may provide for an emergency variance from compliance

with technology-based emission limitations provided that: (1) The cause

of the emergency can be identified, (2) the permitted facility was

being operated at the time of the emergency, (3) the owner/operator

took all reasonable steps to minimize levels of emissions that exceeded

emission standards or requirements of the permit, and (4) submitted

notice of the emergency to the Department within two (2) working days

of the time when emission limitations were exceeded due to the

emergency. The EPA does not recognize the ability of a permitting

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

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

the procedures allowed by Part 70. A Part 70 permit may be issued or

revised (consistent with Part 70 permitting procedures) to incorporate

those terms of a variance that are consistent with applicable

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

issuance or modification procedures, the schedule of compliance set

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

enforcement of applicable requirements notwithstanding the existence of

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

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

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

the applicable requirements on which it is based.''

3. Permit Fee Demonstration

The Virgin Islands' workload analysis and fee demonstration shows

that the state will collect sufficient revenue to implement the Title V

program. The Virgin Islands will collect permit fees beginning at $18

per ton of actual emissions of regulated pollutants. The Virgin

Islands' fee demonstration and regulation state that the Virgin Islands

may raise fees if necessary in the future. Furthermore, the Virgin

Islands' law requires that sufficient fees be collected to cover direct

and indirect expenses necessary to develop, administer and enforce the

Virgin Islands' Title V program, including the Small Business Technical

and Environmental Compliance Assistance Program as required by Section

507 of the Act. The Virgin Islands' law establishes a special account

which is independent and separate from any other account in the Virgin

Islands and must be used only for the Air Quality Program.

4. Provisions Implementing Section 112 of the Act

a. authority for Section 112 Implementation: Virgin Islands has

demonstrated in its Title V program submittal adequate legal authority

to implement and enforce all Section 112 requirements through the title

V permit. This legal authority is contained in Virgin Islands' enabling

legislation (V.I. Code Title 12, Section 201) and in regulatory

provisions defining ``applicable requirements'' and stating that the

permit must incorporate all applicable requirements. EPA has determined

that this is sufficient to allow Virgin Islands to issue permits that

assure compliance with all Section 112 requirements. The Attorney

General's legal opinion also certifies that VIDPNR has authority to

implement the air toxics program and to accept automatic delegation of

future national emission standards for hazardous air pollutants.

Section 206-71 of the RAR provides that NESHAPs when promulgated by the

EPA Administrator will become effective as part of Virgin Islands'

rules and regulations. Section 206 of the RAR provides for the

following Section 112 requirements:

i. case-by-case MACT determinations: In the event that no

applicable emissions limitations for the hazardous air pollutants have

been established by the Administrator, VIDPNR will make case-by-case

Maximum Achievable Control Technology (MACT) determinations as required

under Sections 112(j) and (g) of the Act. The EPA issued an

interpretive notice on February 14, 1995 (60 FR 8333), which outlines

EPA's revised interpretation of 112(g) applicability. The notice

postpones the effective date of 112(g) until after EPA has promulgated

a rule addressing that provision. The notice sets forth in detail the

rationale for the revised interpretation.

The Section 112(g) interpretive notice explains that EPA is still

considering whether the effective date of Section 112(g) should be

delayed beyond the date of promulgation of the Federal rule so as to

allow states time to adopt rules implementing the Federal rule, and

that EPA will provide for any such additional delay in the final

Section 112(g) rulemaking.

VIDPNR has provided broad language in its regulation that will

allow the implementation of 112(g) immediately after EPA promulgates

its rule.

ii. early reductions: The rule authorizes VIDPNR to issue permits

with an alternate emission limit under the Act's Section 112(i)(5)

early reductions program.

iii. The rule requires sources subject to Section 112(r) of the Act

to prepare and submit risk management plans. A source must submit

annual certification ensuring the proper implementation of the risk

management plan.

b. Section 112(l): Requirements for approval specified in 40 CFR

70.4(b), encompass Section 112(l)(5) approval requirements for

delegation of Section 112 standards as they apply to Part 70 sources.

Section 112(l)(5) requires that the state's program contain adequate

authorities, adequate resources for implementation, an expeditious

compliance schedule, and adequate enforcement ability, which are also

requirements under Part 70. In a letter dated May 30, 1995, VIDPNR

requested delegation through 112(l) of all existing 112 standards and

all future 112 standards for both Part 70 and non-Part 70 sources and

infrastructure programs. In the letter, VIDPNR demonstrated that it has

sufficient legal authorities, adequate resources, capability for

automatic delegation of future standards, and adequate enforcement

ability for implementation of Section 112 of the Act for both Part 70

sources and non-Part 70 sources. Therefore, the EPA is proposing to

grant approval under Section 112(l)(5) and 40 CFR Part 63.91 to Virgin

Islands for its program mechanism for receiving delegation of all

existing and future 112(d) standards for both Part 70 and non-Part 70

sources.

Virgin Islands commits to appropriately implementing the existing

and future requirements of Sections 111, 112 and 129 of the Act, and

all maximum achievable control technology (MACT) standards promulgated

in the future, in a timely manner.

B. Options for Approval/Disapproval and Implications

The EPA is proposing full approval of the operating permits program

submitted to EPA by the United States Virgin Islands on November 18,

1993 and supplemented through June 9, 1995. Among other things, the

Virgin Islands has demonstrated that the program will be adequate to

meet the minimum elements of a State operating permits program as

specified in 40 CFR Part 70.

Requirements for approval, specified in 40 CFR 70.4(b), encompass

section 112(l)(5) requirements for approval of a program for delegation

of section 112 and standards as promulgated by EPA as they apply to

part 70 sources. Section 112(l)(5) requires that the State's program

contain adequate authorities,

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adequate resources for implementation, and an expeditious compliance

schedule, which are also requirements under part 70. The Virgin Islands

has informed EPA that it intends to accept automatic delegation of

Section 112 standards and programs. Therefore, the EPA is also

proposing to grant approval under section 112(l)(5) and 40 CFR 63.91 to

Virgin Island for its program mechanism for receiving delegation of all

existing and future section 112(d) standards for both part 70 and non-

part 70 sources, and infrastructure programs under section 112 that are

unchanged from Federal rules as promulgated.

III. Administrative Requirements

A. Request for Public Comments

The EPA is requesting comments on all aspects of this proposed full

approval. Copies of the State's submittal and other information relied

upon for the proposed full approval are contained in a docket

maintained at the EPA Regional Offices located in New York and San Juan

and at VIDPNR. The docket is an organized and complete file of all the

information submitted to, or otherwise considered by, EPA in the

development of this proposed rulemaking. The principal purposes of the

docket are:

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

documents so that they can effectively participate in the approval

process; and

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

consider any comments received by February 26, 1996.

B. Executive Order 12866

The Office of Management and Budget has exempted this action from

Executive Order 12866 review.

C. Regulatory Flexibility Act

The EPA's actions under Section 502 of the Act do not create any

new requirements, but simply address operating permits 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.

D. Unfunded Mandates Act

Under Section 202 of the Unfunded Mandates Reform Act of 1995

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

must prepare a budgetary impact statement to accompany any proposed or

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

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

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

must select the most cost effective and least burdensome alternative

that achieves the objectives of the rule and is consistent with

statutory requirements. Section 203 requires EPA to establish a plan

for informing and advising any small governments that may be

significantly or uniquely impacted by the rule.

EPA has determined that the proposed approval action promulgated

today does not include a federal mandate that may result in estimated

costs of $100 million or more to either State, local, or tribal

governments in the aggregate, or to the private sector. This 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, Environmental Protection, Intergovernmental

relations, Operating permits, and Reporting and recordkeeping

requirements.

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

Dated: December 5, 1995.

Jeanne M. Fox,

Regional Administrator.

[FR Doc. 96-1207 Filed 1-24-96; 8:45 am]

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