Arizona Redesignation of the Yavapai-Apache Reservation to a PSD Class I Area

ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[AZ 58-1-7131-a; FRL-5634-4]

Arizona Redesignation of the Yavapai-Apache Reservation to a PSD

Class I Area

AGENCY: Environmental Protection Agency (EPA).

ACTION: Final rule.

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SUMMARY: The purpose of this action is to approve the request by the

Yavapai-Apache Tribal Council to redesignate the Yavapai-Apache

Reservation (``the Reservation'') as a non-Federal Class I area under

the Clean Air Act program for prevention of significant deterioration

of air quality. The Class I designation will result in lowering the

allowable increases in ambient concentrations of particulate matter,

sulfur dioxide, and nitrogen dioxide on the Reservation.

EFFECTIVE DATE: December 2, 1996.

ADDRESSES: The public docket for this rulemaking, which includes

additional information related to the final rule and materials

submitted to EPA, is available for public inspection and copying during

normal business hours. Please contact the EPA official listed below at

the given address. A reasonable fee may be charged for copying.

FOR FURTHER INFORMATION CONTACT: Jessica Gaylord, Air and Toxics

Division (A-5-1), U.S. EPA Region 9, 75 Hawthorne Street, San

Francisco, CA 94105-3901, (415) 744-1290. An electronic copy of this

Federal Register notice and other pertinent information is available on

the World Wide Web at this Internet address: http://www.epa.gov/

region09/air/yavapai/

SUPPLEMENTARY INFORMATION:

I. The Clean Air Act's Program to Prevent Significant Deterioration

of Air Quality (PSD)

A. Background

The genesis of the PSD program under the Clean Air Act (CAA) was a

lawsuit brought by the Sierra Club to enjoin EPA's approval of state

implementation plans that allowed air quality degradation in areas

having air quality better than the national ambient air quality

standards. Sierra Club v. Ruckelshaus, 344 F. Supp. 253 (D.D.C. 1972),

aff'd per curiam, 4 Env't Rep. Cases 1815 (D.C. Cir. 1972), aff'd by an

equally divided court, sub. nom. Fri v. Sierra Club, 412 U.S. 541

(1973). The district court granted the injunction reasoning that the

stated purpose of the Clean Air Act in section 101(b)(1) to ``protect

and enhance'' the quality of the nation's air embodied a non-

degradation policy. Sierra Club at 255-56.

In response to the Sierra Club decision EPA adopted a PSD program.

See 39 FR 42510 (Dec. 5, 1974). The administrative program was

superseded by a congressionally-crafted program in the 1977 amendments

to the Clean Air Act. Pub. L. No. 95-95, 91 Stat. 685; see generally

Alabama Power v. Costle, 636 F.2d 323, 346-52 (D.C. Cir. 1979)

(recounting history of PSD program preceding and including the adoption

of the 1977 amendments). EPA presently has two sets of regulations

implementing the 1977 statutory PSD program: (1) 40 CFR 51.166

establishes the requirements for state-administered PSD programs, and

(2) 40 CFR 52.21 provides for Federal implementation of PSD

requirements to address programmatic gaps.1

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\1\ The regulations have not been revised to conform with

changes made in the 1990 Clean Air Act amendments. Pub. L. No. 101-

549, 104 Stat. 2399.

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B. PSD Areas and Classifications

EPA establishes national ambient air quality standards (NAAQS)

under the CAA. See 40 CFR Part 50. Areas nationwide are ``designated''

under section 107 of the CAA based on their air quality status relative

to the NAAQS. The PSD program applies to areas designated

``attainment'' and ``unclassifiable'' under section 107 of the CAA--

areas that meet the NAAQS, or areas that cannot be determined on the

basis of available information as meeting or not meeting the NAAQS.

These areas are often referred to as ``PSD areas.''

PSD areas are further categorized as Classes I, II or III. The

classification of an area determines the amount or ``increment'' of air

quality deterioration that is allowed over a baseline level. Class I

areas have the smallest increments and therefore allow the least amount

of air quality deterioration. Conversely, Class III areas have the

largest air quality increments and allow the greatest deterioration. In

all instances, the NAAQS represent the overarching ceiling that may not

be exceeded in a PSD area, notwithstanding any increment.

There are PSD increments for particulate matter, sulfur dioxide and

nitrogen dioxide. EPA's PSD regulations establish the incremental

amount of air quality deterioration of these pollutants that is allowed

in Class I, II and III areas. See 40 CFR 52.21(c).

When Congress enacted the PSD program in 1977 it provided that

specified Federal lands, including

[[Page 56462]]

certain national parks and wilderness areas, must be designated as

Class I areas and may not be redesignated to another classification.

See section 162(a) of the CAA. These areas are called mandatory Federal

Class I areas. The statute also carried forward as Class I areas any

areas redesignated as Class I under EPA's pre-1977 regulations. The

Northern Cheyenne reservation was a redesignated Class I area affected

by this provision. See Nance v. EPA, 645 F.2d 701 (9th Cir. 1981), cert

denied, Crow Tribe of Indians v. EPA, 454 U.S. 1081 (1981). In the 1977

amendments Congress provided that all other PSD areas of the country

would be designated as Class II areas. See section 162(b) of the CAA.

C. PSD Class I Redesignation Requests and Procedural Requirements

As noted, Congress designated all PSD areas of the country as Class

II, except for special Federal lands and pre-existing redesignated

Class I areas. At the same time, Congress gave States and Indian Tribes

broad authority to redesignate Class II areas as Class I. See section

164 of the CAA.

Section 164(c) of the CAA expressly provides for PSD redesignations

by Federally recognized Indian Tribes:

Lands within the exterior boundaries of reservations of

Federally recognized Indian tribes may be redesignated only by the

appropriate Indian governing body.

The Department of the Interior periodically publishes a list of Tribes

officially recognized by the Federal government. See 60 FR 9250 (Feb.

16, 1995) (identifying Yavapai-Apache Nation of the Camp Verde

Reservation, Arizona).

Congress has generally established a narrow role for EPA in

reviewing State and Tribal PSD redesignations. Under EPA's pre-1977

regulations, EPA would disapprove a redesignation submittal if the

requesting State or Tribe arbitrarily and capriciously disregarded the

following considerations: (1) growth anticipated in the area, (2) the

social, environmental, and economic effects, or (3) any impacts on

regional or national interests. See 39 FR at 42515.

By contrast, the PSD program enacted by Congress in 1977 provides

that EPA may disapprove a redesignation request only if it finds, after

notice and opportunity for public hearing, that the request does not

meet the applicable procedural requirements. See section 164(b)(2) of

the CAA. The legislative history indicates that Congress's 1977

amendments were intended to curtail EPA's authority to disapprove a

redesignation request under its pre-1977 regulations, giving States and

Tribal governments greater discretion in this area:

The intended purposes of [the congressional 1977 PSD program]

are . . . (3) to delete the current EPA regulations and to

substitute a system which gives a greater role to the States [,

Tribal,] and local governments and which restricts the Federal

Government in the following ways: . . . (b) By eliminating the

authority which the Administrator has under current EPA regulations

to override a State's [or Tribe's] classification of an area on the

ground that the State [or Tribe] improperly weighed energy,

environment, and other factors.

See H.R. Rep. No. 294, 95th Cong., 1st Sess. 7-8 (1977) reprinted in

Senate Comm. on the Environment and Public Works, 95th Cong., 2d Sess.,

A Legislative History of the Clean Air Act Amendments of 1977, vol. 4

at 2474-75 (1978) (hereafter ``1977 CAAA Legislative History'').2

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\2\ While this language refers only to states, both the statute

and the legislative history make it clear that the discussion

applies equally to redesignations by tribes. See, e.g., S. Rep. No.

127, 95th Cong., 1st Sess. 9 (1977) reprinted in 1977 CAAA

Legislative History, vol. 3 at 1383.

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Accordingly, EPA's current regulations provide for EPA disapproval

of a redesignation only if the requesting State or Tribe did not meet

the applicable procedural requirements in adopting its proposed

redesignation:

The Administrator shall disapprove, within 90 days of

submission, a proposed redesignation of any area only if he finds,

after notice and opportunity for public hearing, that such

redesignation does not meet the procedural requirements of [40 CFR

52.21(g)].

See 40 CFR 52.21(g)(5). In adopting the regulatory revisions to reflect

the statutory provisions, EPA explained that in light of section

164(b)(2) of the CAA it ``will no longer be able to base a disapproval

of a proposed redesignation on a finding that the State [or Tribal]

decision was arbitrary or capricious.'' See 42 FR 57479, 57480 (Nov. 3,

1977). Thus, so long as the applicable procedures are met, the statute

and implementing regulations generally leave the decision to constrict

or expand the amount of allowable air quality deterioration to the

State or Tribal authority requesting the redesignation.

Several Indian Tribes have had lands within reservation boundaries

redesignated as Class I areas. The EPA has previously approved Class I

redesignation requests for the Northern Cheyenne Indian Reservation,

the Flathead Indian Reservation, the Fort Peck Indian Reservation and

the Spokane Indian Reservation. See 40 CFR 52.1382(c) and 52.2497(c).

The procedural requirements for a Class I redesignation by an

Indian Governing Body are as follows:

(1) At least one public hearing must be held in accordance with

procedures established in 40 CFR 51.102;

(2) Other States, Indian Governing Bodies, and Federal Land

Managers whose lands may be affected by the proposed redesignation must

be notified at least 30 days prior to the public hearing;

(3) At least 30 days prior to the Tribe's public hearing, a

discussion of the reasons for the proposed redesignation including a

satisfactory description and analysis of the health, environmental,

economic, social and energy effects of the proposed redesignation must

be prepared and made available for public inspection, and the public

hearing notice must contain appropriate notification of the

availability of such discussion;

(4) Prior to the issuance of the public notice for a proposed

redesignation of an area that includes Federal lands, the Tribe must

provide written notice to the appropriate Federal Land Manager and an

adequate opportunity for the Federal Land Manager to confer with the

Tribe and submit written comments and recommendations;

(5) Prior to proposing the redesignation, the Indian Governing Body

must consult with the State(s) in which the Reservation is located and

that border the Reservation. See 40 CFR 52.21(g)(4).

II. Yavapai-Apache Tribe Request to Redesignate its Reservation

From Class II to Class I

On December 17, 1993, the Yavapai-Apache Tribal Council (``the

Tribal Council'' or ``the Tribe'') submitted to EPA a request to

redesignate the Yavapai-Apache Reservation from Class II to Class I.

The Tribe's submittal explains that its redesignation request is to

protect its air quality for its citizens:

The Yavapai-Apache Tribe desires to maintain high quality air

standards for its citizens by redesignating Reservation lands as a

Class I Clean Air area.

See Yavapai-Apache Tribe Air Quality Redesignation Plan, Sept.

1993, at p. 1.

The Yavapai-Apache Reservation is located in the State of Arizona.

The Reservation is comprised of five land parcels which total

approximately 635 acres. The Tribe's redesignation request includes its

entire Reservation. Maps of the Reservation are included as appendices

to the Tribe's September 1993 Air Quality Redesignation Plan, which is

available at the public docket identified at the beginning of this

document.

[[Page 56463]]

The Reservation is approximately 90 miles north of Phoenix in the

Verde Valley of central Arizona. The Verde Valley is situated near the

``red rock'' country of Sedona and Oak Creek Canyon. Nearby national

forests include the Coconino National Forest, the Kaibab National

Forest and the Prescott National Forest. The Montezuma Castle,

Montezuma Well and Tuzigoot National Monuments are located within the

Verde Valley in the vicinity of the Reservation. In addition, the

Sycamore Canyon Wilderness Area, designated a mandatory Federal Class I

area under the CAA, is located a few miles north of the Town of

Clarkdale. See 40 CFR 81.403.

EPA reviewed the Tribe's request and preliminarily determined that

it met the applicable procedural requirements of 40 CFR 52.21(g)(4). On

April 18, 1994, EPA published a notice of proposed rulemaking in the

Federal Register proposing to approve the request and announced a 30-

day period to receive public comment regarding whether the Tribe had

met the procedural requirements. See 59 FR 18346.

At the request of the Town of Clarkdale, which is located adjacent

to the Clarkdale parcel of the Yavapai-Apache Reservation, EPA held a

public hearing on the proposed redesignation on June 22, 1994. EPA's

public hearing notice provided that the scope of the public hearing

would be limited to whether the Tribe has satisfied the redesignation

procedural requirements. EPA indicated that only comments which address

this issue would be considered in EPA's final decision to approve or

deny the redesignation request. EPA's public hearing notice also

indicated that EPA would allow until July 6, 1994 for the submittal of

written comments. In order to facilitate public understanding about

EPA's proposed action, EPA indicated that it would begin the public

hearing with an explanation of the Class I redesignation process and

the PSD program.

Following the public hearing, the Town of Clarkdale requested an

extension of the public comment period. On July 20, 1994, EPA published

a Federal Register document announcing an extension of the public

comment period, providing the public until August 22, 1994 to submit

written comments addressing whether the Tribe has met all of the

procedural requirements of 40 CFR 52.21(g). See 59 FR 37018-19.

The Governor of Arizona submitted a letter dated August 22, 1994,

to EPA indicating that ``[t]he effects of the proposed redesignation

are not apparent to all of the stakeholders, and confusion exists about

the potential impacts of the Agency's proposed action.'' The Governor's

letter requested that EPA initiate dispute resolution of the matter

pursuant to section 164(e) of the CAA.

In brief, section 164(e) of the CAA provides that if a State

affected by the redesignation of an area by an Indian Tribe disagrees

with the redesignation, the Governor may request EPA to enter into

negotiations with the parties involved to resolve the dispute. Section

164(e) further provides that if the parties do not reach agreement, EPA

shall resolve the dispute.

III. Today's Action

A. EPA's Final Decision to Approve the Tribe's Class I Redesignation

Request

In today's document, EPA is announcing its decision to approve the

Yavapai-Apache Tribe's December 17, 1993 request to redesignate its

reservation from Class II to Class I for PSD purposes. The approval

means that Class I PSD increments will apply within the reservation's

boundaries, allowing a smaller amount of allowable air quality

deterioration within the reservation than as a Class II area. See 40

CFR 52.21(c). In addition, a new major source or major modification

which would construct within 10 km of the Reservation will be subject

to review under PSD if emissions would have an impact on the

Reservation equal to or greater than one microgram per cubic meter

(g/m\3\), (24-hour average). See 40 CFR 52.21(b)(2), 40 CFR

52.21(b)(23), and 40 CFR 52.21(i).

EPA received a number of comments on its April 18, 1994 proposal to

approve the Tribe's Class I redesignation. EPA has carefully reviewed

and considered comments received during the public comment period in

making its decision to approve the redesignation request. A number of

the commenters raised issues outside the scope of EPA's review. As

previously discussed, generally EPA may disapprove a redesignation

request only if EPA finds that the redesignation does not meet the

applicable procedural requirements. See 40 CFR 52.21(g)(5). EPA's

review of the Tribe's request in light of the comments revealed no

procedural error by the Tribe. Thus, EPA is finalizing its April 18,

1994 preliminary judgment that the Tribe met the procedural

requirements.

In a separate document published in today's Federal Register, EPA

explained the section 164(e) dispute resolution process, and addressed

the issues presented. EPA's notice settles the dispute, as the State

and the Tribe were unable to resolve their disagreements about the

proposed redesignation. Once dispute resolution has been initiated, the

CAA provides in section 164(e) that EPA ``consider the extent to which

the lands involved are of sufficient size to allow effective air

quality management * * *.'' The State thus argued that the five

separate parcels that comprise the Yavapai-Apache Reservation are too

small and scattered to allow for effective air quality management.

Among the principal issues, the State also emphasized its concern

regarding public understanding of the possible effects of this

redesignation and issues related to potential future requests for

redesignation by other Tribes. In settling the dispute, EPA disagreed

with the State's conclusion that effective air quality management would

be adversely affected by the redesignation. In addition, EPA has

pledged its continuing commitment to facilitating public understanding

of the effects of the redesignation. Moreover, each redesignation

request must be evaluated on its merits, and concerns relating to

potential future requests do not provide a basis for the denial of the

Yavapai-Apache request. EPA's resolution of the dispute is consistent

with the decision announced here, to approve the Tribe's Class I

redesignation request. The reader is referred to the separate document

published in today's Federal Register for more information on EPA's

decision making in resolving the intergovernmental dispute.

B. Public Comments

As noted, EPA received many comments on its April 18, 1994 proposal

to approve the Yavapai-Apache Tribe's Class I redesignation request.

Many commenters, including local residents who are not Tribal members,

supported EPA's proposal. Other commenters identified alleged

procedural errors or objected to the Class I redesignation for other

reasons. EPA also received comments questioning whether all of the land

parcels identified by the Tribe are part of the Tribe's reservation.

While EPA has reviewed all comments received, only those comments

identifying potential procedural errors and claiming that the Tribal

submittal includes lands outside the reservation are relevant in

determining whether EPA should modify its proposal and disapprove the

request, in part or full. As noted, EPA may disapprove a redesignation

request only if EPA finds that it does not meet the applicable

procedural requirements. See section 164(b)(2) of the CAA & 40 CFR

52.21(g)(5). In addition to pertinent procedural issues, the question

[[Page 56464]]

regarding the affected land parcels is relevant because the underlying

statutory authority for Tribal redesignations only includes lands

within reservation boundaries. See section 164(c) of the CAA.

All other public comments objecting to the redesignation do not

provide a basis for EPA disapproval. In the discussion that follows,

EPA has nevertheless addressed many such comments contesting the

redesignation, for the sole purpose of facilitating the public's

understanding of today's action. EPA is providing separate responses to

the remaining comments in the Technical Support Document (TSD)

available in the public docket for this action, identified at the

beginning of this document.

1. Scope of Yavapai-Apache Reservation

As noted, the Yavapai-Apache Tribe redesignation request

encompassed five separate land parcels that collectively comprise the

Tribe's reservation. EPA received comments questioning whether two of

the parcels included in the redesignation request, the parcel near the

Montezuma Castle National Monument and the Clarkdale parcel, were

actually encompassed in the Yavapai-Apache Reservation and therefore

allowed to be redesignated under the Act.

The Clean Air Act provides that lands within the exterior

boundaries of reservations of federally recognized Indian tribes may be

redesignated by the appropriate Indian governing body. See section

164(c) of the CAA. The PSD regulations define ``Indian Reservation'' as

``any federally recognized reservation established by Treaty,

Agreement, executive order, or act of Congress.'' See 40 CFR

52.21(b)(27). In addition to lands formally designated as

``reservations,'' EPA considers trust land validly set apart for use of

a tribe to be an ``Indian Reservation.'' See Oklahoma Tax Commission v.

Citizen Band Potawatomi Indian Tribe of Oklahoma, 498 U.S. 505, 511

(1991); United States v. John, 437 U.S. 634, 648-49 (1978); 59 FR

43956, 43960 (Aug. 25, 1994); 56 FR 64876, 64881 (Dec. 12, 1991). EPA

has indicated that it will be guided by relevant case law in

interpreting the scope of ``reservation'' under the Clean Air Act. See

59 FR 43960.

The Bureau of Indian Affairs (BIA) has certified by letter to EPA,

dated May 13, 1994, that all five parcels identified in the

redesignation request are lands held in trust by the U.S. government

for the beneficial use of the Tribe, including the parcels near

Montezuma Well National Monument and Clarkdale. The BIA certification

was accompanied with an abstract of the various title documents and BIA

and U.S. Geological Survey quadrangle maps showing the parcels. The BIA

certification is available for inspection at the public docket

identified at the beginning of this document. EPA therefore concludes

that all of the lands included in the Tribe's redesignation submittal

are lands encompassed within its reservation.

2. Analysis of Health, Environmental, Economic, Social and Energy

Effects

EPA's regulations require that a ``satisfactory description and

analysis of the health, environmental, economic, social and energy

effects of the proposed redesignation'' must be available for public

inspection 30 days prior to the public hearing held by the Tribe. See

40 CFR 52.21(g)(2)(iii). (The public hearing held by the Tribe is

separate from the one conducted by EPA.)

EPA did not receive public comments that the Tribe failed to follow

proper procedures by failing to conduct a public hearing, by failing to

have the analysis available prior to the hearing, by failing to provide

timely notice of the hearing, or by failing to consult with the State

prior to proposing the redesignation. See 1977 CAAA Legislative

History, vol. 3 at 373 (colloquy between Senators Garn and Muskie,

during the Senate's consideration of the Conference report, about the

types of procedural error that might trigger a disapproval). EPA,

however, has received comments alleging that the Tribe's analysis of

health, environmental, economic, social and energy effects was

inadequate.

A threshold question is the level of scrutiny EPA should apply to

the Tribe's analysis in the face of claims that it is inadequate. As

previously discussed, section 164(b)(2) of the CAA and the implementing

regulations at 40 CFR 52.21(g)(5) provide that EPA may disapprove a

redesignation request only if it finds that the request does not meet

the procedural requirements. EPA believes that the availability of a

satisfactory effects analysis is central to meaningful notice and

public hearing and therefore a relevant procedural consideration. At

the same time, there is considerable discretion involved in determining

what is ``satisfactory.''

The specific use of the word ``satisfactory'' in the statute and

implementing regulations suggests a relatively low threshold. Congress,

by contrast, did not dictate that the analysis be comprehensive or

exhaustive. Further, the statutory language does not assign any

specific weight to the consideration of health, environmental,

economic, social or energy effects, or suggest that one consideration

should be given priority over another. The commenters objecting to the

Tribe's analysis appeared to assume that the Tribe had to justify its

redesignation. These commenters suggested that potential adverse

effects, particularly possible economic impacts, should be disabling.

These comments are discussed further below. In any event, EPA's

implementing regulations do not elaborate what constitutes a

``satisfactory'' description and analysis, nor do the regulations

specify to what extent this discussion should focus on the lands being

proposed for redesignation or surrounding areas.

The legislative and regulatory history generally indicate that

EPA's review of the analysis should be deferential. The legislative

history accompanying the 1977 amendments, described previously,

provides that Congress intended to eliminate EPA's authority to

override a redesignation on the grounds that energy, environment and

other factors were improperly weighed. See H.R. Rep. No. 294 at 7-8.

The resulting 1977 amendments supplanted EPA's administrative scheme

with provisions that limited EPA to a procedural review. See section

164(b)(2). In developing subsequent regulations, EPA indicated that EPA

would no longer be able to disapprove a redesignation based on its

finding that the State or Tribal decision was arbitrary or capricious.

See 42 FR at 57480.

EPA's decision to approve a redesignation by the Northern Cheyenne

Tribe was upheld under the pre-existing regulatory regime that

expressly provided for an analysis that included consideration of

growth anticipated, regional impacts, and social, environmental and

economic effects as well as stricter EPA scrutiny of the analysis. The

petitioners claimed that the Tribe's analysis was inadequate in several

respects. The reviewing court affirmed EPA's approval, rejecting the

claim that the Tribe was required to meet exacting analysis

requirements and holding that the Tribe had considered the factors

identified in EPA's regulations. Nance v. EPA, 645 F.2d at 712. The

court further reasoned that the Tribe's decision was bolstered by the

policy for maintaining clean air embodied in the CAA:

[T]he Clean Air Act contains a strong presumption in favor of

the maintenance of clean air, and the nature of a decision which

simply requires that the air quality be maintained at a certain

level prevents any exact prediction of its consequences. The Tribe

has considered the factors enumerated in EPA regulations, and its

choice in favor of the certainty of clean air is a choice

[[Page 56465]]

supported by the preferences embodied in the Clean Air Act.

Nance v. EPA, 645 F.2d at 712.

Accordingly, EPA generally has a limited role in reviewing the

Class I redesignation requests. The emphasis is on assuring that there

are no procedural defects. At the same time, EPA must refrain from

substituting its judgment for that of the state or tribe requesting the

redesignation. Thus, EPA must balance reviewing the Tribe's analysis to

ensure that relevant considerations were examined without

inappropriately ``second-guessing'' the Tribe's judgment.

EPA finds the Yavapai-Apache Tribe's analysis of the required

factors to be satisfactory. The Tribe's submittal describes and

analyzes the environmental, health, economic, social and energy effects

of the proposed redesignation, including present conditions, the

effects of redesignating to Class I and the effects of remaining a

Class II area. The submittal describes the Tribe's reasons for

proposing the redesignation as well as alternatives to the

redesignation and the potential impacts of the redesignation. See

generally Yavapai-Apache Tribe Air Quality Redesignation Plan, Sept.

1993.

The Town of Clarkdale commented that the Tribe failed to provide an

accurate assessment and description of the health, environmental,

economic, social and energy effects of the proposed redesignation on

off-reservation areas including particularly Clarkdale. The Town of

Clarkdale commented that it would be seriously and adversely affected

by the redesignation of a reservation parcel near the Town. Another

commenter asserted that the Tribe's analysis is incomplete and

inadequate because the requirement to perform a description and

analysis ``implies that the Tribe must weigh all relevant

considerations and then justify its request.'' The commenter stated

that the analysis must include adverse economic impacts on the

surrounding areas and activities. The commenter stated that the Tribe

may not take action ``that will inflict economic harm on off-

Reservation landowners, communities, and citizens, just because the

Tribe believes that the action will benefit the Tribe.'' The commenter

was concerned about increased regulation, increased costs to industry

and negative economic impacts on future mining activities outside the

reservation.

EPA disagrees that the Tribe must justify its redesignation request

in the manner suggested. A description and analysis of factors does not

dictate calculating and demonstrating that certain factors outweigh

others. Moreover, the fact that no weight or priority is assigned to

any particular consideration, taken together with the broad

redesignation discretion conferred on States and Tribes, indicates that

the Tribe does not have to justify or overcome a balancing test in its

redesignation request or show that a proposed redesignation will have

no impact on the surrounding community. The Tribe's responsibility is

to perform a ``satisfactory discussion and analysis'' of health,

environmental, economic, social and energy effects.

The Tribe's request contained an analysis of health, environmental,

economic, social and energy effects, including an examination of

effects on conditions within the reservation. As noted, EPA's

regulations do not prescribe whether or to what extent impacts outside

the area being requested for redesignation must be examined.

Nevertheless, the Tribe's submittal addressed impacts to housing,

roads, public services, and general impacts to tourism and jobs in the

surrounding areas, as well as a more detailed discussion of the impacts

to the reservation lands. The Tribe's description of potential effects

includes a discussion of the jobs related to tourism in comparison with

those related to industrial expansion, and the potential effects on

certain types of facilities located outside the Reservation boundaries.

The Tribe noted that some industries may incur the cost of additional

pollution controls to reduce impacts on the Class I area. The Tribe's

submittal also identified the presence of mineral resources off

reservation.

The Tribe's request to redesignate its reservation as Class I would

limit the amount of future air quality deterioration within the

reservation's boundaries. While the Tribe described and analyzed

relevant effects, specific prospective impacts are speculative and

would depend on the nature of future activities and their particular

ambient air quality impacts. It is difficult to assess such impacts

because ``the nature of a decision which simply requires that the air

quality be maintained at a certain level prevents any exact prediction

of its consequences.'' Nance v. EPA, 645 F.2d at 712.

3. Concern About Potential Impacts

Much of the concern about the potential off-reservation impacts

stems from misimpressions about the scope of the PSD program and the

protection of a non-Federal Class I area under the program. To

facilitate public understanding, EPA has addressed the concerns about

off-reservation impacts in the ensuing discussion.

a. Concern About Increased Regulation. Some commenters were under

the misimpression that a Class I redesignation would place the

residents of the Verde Valley ``under the strictest air control

measures of the Federal law.'' These commenters expressed concerns that

redesignation would activate restrictions on wood burning and any form

of earth movement in order to curtail dust and smoke, as well as

requiring vehicle smog inspections.

The residents of the Verde Valley will not be brought under the

strictest air control measures of Federal law as a result of a Class I

redesignation. As discussed in the proposal (59 FR 18346, April 18,

1994) and at EPA's presentation during the public hearing, the Verde

Valley and the Reservation are currently subject to the PSD program. As

noted, the PSD program applies to the following areas: (1)

``attainment'' areas that meet the NAAQS and (2) ``unclassifiable''

areas that cannot be classified as meeting or not meeting the NAAQS.

The Class I designation does not change which sources on or off the

reservation are subject to PSD. In all instances, only ``major''

stationary sources in PSD areas are subject to the PSD program. See,

e.g., 40 CFR 52.21(b)(1)(i). Major stationary sources are relatively

large industrial sources. The PSD provisions do not apply to mobile

sources, such as cars. Major stationary sources are sources that emit,

or have the potential to emit, over 250 tons per year (tpy) of a

regulated air pollutant, or 100 tpy if the source is one of the 28

source categories listed in 40 CFR 52.21(b)(1). Iron and steel mills

are an example of a listed source category that would be subject to PSD

if the facility has the potential to emit more than 100 tpy of a

regulated air pollutant. Particulates from unpaved roads could be

affected by the redesignation only insofar as they occur at a major

stationary source. Redesignation will not limit the home use of wood-

burning stoves, nor will it create restrictions on controlled forest

burning, as commenters suggested.

Further, PSD applies prospectively to proposed new major stationary

sources or to proposed major modifications of existing major stationary

sources. Very generally, major modifications are changes at an existing

major stationary source that result in a significant net increase of

regulated air pollutants. See 52.21(b)(2).

The central change resulting from the Class I redesignation

approved today is that it allows for less air quality deterioration on

the reservation than would have been allowed under its

[[Page 56466]]

Class II designation. The area around the reservation will continue to

maintain its Class II designation. EPA's PSD regulations establish the

incremental amount of air quality deterioration that is allowed for

Class I, II and III areas for particulate matter, sulfur dioxide and

nitrogen dioxide. See 40 CFR 52.21(c). In addition, a new major

stationary source or major modification which would construct within 10

km of a Class I area is subject to review under the PSD regulations if

emissions from the source would have an impact on the Class I area

equal to or greater than the 1 g/m3 significance level.

See 40 CFR 52.21(b)(2), 40 CFR 52.21(b)(23), and 40 CFR 52.21(i).

There is another program under separate provisions of the Clean Air

Act that imposes more stringent requirements in nonattainment areas, or

so called ``dirty air'' areas, in which air quality does not meet the

NAAQS. Under the nonattainment area requirements, states may need to

develop more stringent or broader requirements; these may affect

smaller stationary sources than would be regulated under the PSD

program, or in some instances necessitate vehicle inspection and

maintenance (smog-check) programs. Such a program would not go into

effect in the Verde Valley as a result of the redesignation. In fact,

one of the primary objectives of the PSD program is to prevent air

quality in attainment areas from deteriorating such that they fail to

meet the NAAQS, become ``nonattainment'' and necessitate more stringent

air pollution control measures.

Commenters also expressed concern that the redesignation would

place additional burdens on local regulatory agencies, as well as the

Arizona Department of Environmental Quality (ADEQ) to apply the Class I

increments to off-reservation sources. As the PSD permitting authority

for the lands outside the reservation in the Verde Valley, ADEQ would

be the only agency affected by the redesignation. Air quality modeling

to assess potential impacts on PSD increments is currently required for

Class II areas, and performed by a PSD permit applicant. In certain

circumstances, a proposed source may now also have to assess its impact

on the Class I increment in effect on the Reservation.

Any additional administrative resources which would be required as

a result of the Class I designation would not be substantial. ADEQ must

currently review a permit applicant's analysis of the amount of

increment that is consumed (if any) when a major source or major

modification is constructed in a PSD Class II area near any existing

Federal Class I area in Arizona. In the Verde Valley, for example, a

major source locating near the Sycamore Canyon Wilderness Area--a

Federal Class I area--would already be required to perform a Class I

increment analysis. The redesignation of the Yavapai-Apache Reservation

may increase the likelihood that a source must perform an increment

analysis for nearby Class I areas. While the total number of such Class

I analyses may increase, the Class I analysis is only one component of

an analysis which sources are already required to submit. The

responsibility to review the adequacy of any Class I increment analyses

resulting from the redesignation does not pose substantial additional

burdens for ADEQ in the review of PSD permit applications.

b. Concern About Increased Costs to Industry. Some commenters

expressed concern that the redesignation would significantly increase

the cost of complying with the PSD requirements.

EPA does not expect significant additional delay or cost for

companies attempting to comply with the Class I requirements. As noted,

the only types of industrial development affected by the Class I

designation would be major stationary sources of air pollution. The

permit applicant for a major stationary source in the Verde Valley

subject to PSD is currently required to perform a modeling analysis to

ensure that the Class II increments are protected. The applicant would

therefore have to gather the necessary data, and conduct studies on air

quality for the Class II analysis. The Class I designation may simply

require in certain circumstances that additional receptor points be

added to the model in order to simulate the effect of potential

emissions on the Class I area to ensure that the Class I increments are

protected. The cost of this additional component of an increments

analysis is not expected to be substantial.

Further, every major stationary source proposing to locate in a PSD

area, irrespective of the area's classification, must employ best

available control technology (BACT). See sections 165(a)(4) and 169(3)

of the CAA. Thus, every major source locating in a Class II area is

required to utilize state-of-the-art air pollution controls and

proximity to a Class I area generally would not affect the level of

control required. Thus, as a general rule, a source would not incur

additional control costs due to the redesignation. However, it is

possible that in some instances impacts on a Class I area would require

further decreases in emissions. A source could choose to achieve such

emission reductions in a number of ways, including restrictions on

hours of operation or throughput, additional emission controls or

obtaining emission reductions from other sources in the area. In such a

case a source would likely incur additional costs.

c. Concern About Impacts on Development. Some commenters expressed

concern that the redesignation would hinder all future economic

development in the Verde Valley. Others stated that it would place a

significant economic and regulatory burden on future economic

development in general, and on the development of hardrock mining

resources in particular.

The commenters cited increased costs and increased regulatory

burdens as the bases for the alleged impacts on development. As

discussed above, EPA believes that significant increases in cost will

be rare and generally unlikely to affect development in the area. As

noted, the redesignation does not affect which sources will be subject

to PSD. In all instances, ``major stationary sources'' in PSD areas are

subject to PSD. The Verde Valley area outside the reservation is a PSD

area and its PSD classification is unaffected by EPA's approval of the

Class I designation for the Tribe.

There are many Class I areas located adjacent to communities that

are Class II areas. For example, the Saguaro National Park, a Federal

Class I area, is adjacent to the eastern and western boundaries of

Tucson, Arizona. Tucson has a population size and economic activity

level that far exceeds that presently found in the Verde Valley.

EPA performed a modeling analysis to assess the potential impact of

some ``typical'' major sources proposing to locate near the Yavapai-

Apache Reservation, to facilitate the public's understanding about the

implications of the redesignation. This analysis suggests that while

the Class I redesignation will protect existing air quality on the

Reservation by limiting the amount of deterioration allowed, major

stationary sources with well-controlled emissions locating near the

Reservation should not exceed the Class I increment. More detailed

information about EPA's analysis is available for public review in the

docket listed at the beginning of this document.

As noted, commenters expressed specific concerns about the effect

of the redesignation on development of mining resources in the area,

noting that ore bodies cannot be relocated. One commenter argued that

any conventional mining operation requiring crushing and concentration

[[Page 56467]]

would fall well within the category of a new major stationary source.

The discussion above regarding economic and regulatory effects of

the redesignation in general also applies to mining operations. In

addition, whether proposed mining activity would even be subject to PSD

depends on the quantity and type of expected emissions. As noted, to be

subject to PSD a facility must have the potential to emit more than 250

tpy of a regulated air pollutant, or more than 100 tpy if the facility

is included in one of the 28 listed source categories. Mining

operations are not included in the list of 28 source categories, and

therefore the 250 tpy threshold applies. See 40 CFR 52.21(b)(1)(i). In

addition, for many types of mining operations, fugitive emissions

(emissions which could not reasonably pass through a stack, chimney,

vent or other functionally equivalent opening) make up a majority of

pollutants emitted. See 40 CFR 52.21(b)(20). Fugitive emissions, such

as dust, are counted towards the 250 tpy threshold for determining

whether PSD applies only for specified source categories, which do not

include most mining activities. See 40 CFR 52.21(b)(1)(c)(iii). Thus,

the exclusion of fugitive emissions and the higher pollutant threshold

may exclude mining activity from PSD review.

4. Disperse Reservation Lands and Character of Reservation Lands.

Some commenters stated that they were opposed to the redesignation

because the reservation is comprised of five distinct land parcels. The

commenters were concerned about the small size (i.e., 635 acres) and

dispersed nature of the reservation lands and the impact on effective

air quality management. As noted, EPA may disapprove a redesignation

only if the Tribe did not follow the applicable procedures in adopting

its redesignation. Because these comments do not relate to any alleged

procedural transgression, they are not a basis for disapproval in this

action.

However, section 164(e) calls for EPA to consider ``the extent to

which the lands involved are of sufficient size to allow effective air

quality management'' in resolving intergovernmental disputes about

redesignations. Thus, EPA has fully assessed this consideration in

addressing the State of Arizona's objection to the Tribe's Class I

redesignation. As noted, EPA's resolution of the intergovernmental

dispute is addressed in another notice in today's Federal Register and

the reader is referred to that notice.3

---------------------------------------------------------------------------

\3\ Responses to these comments are also contained in the TSD

for this rulemaking action, available in the public docket

identified at the beginning of this notice.

---------------------------------------------------------------------------

Another commenter stated that the Class I redesignation is

inappropriate because Class I status is intended for the protection of

truly unique areas of national or regional significance because of

their natural, scenic, recreational, or historic values, and that the

Yavapai-Apache Reservation no more reflects any of these

characteristics than any neighborhood in the Verde Valley or the

country.

Congress made specified Federal lands, including certain national

parks and wilderness areas, mandatory Class I areas that may not be

redesignated. See section 162(a) of the CAA. This is consistent with

one of the purposes of the PSD program to preserve, protect, and

enhance the air quality in national parks, national wilderness areas,

national monuments, national seashores, and other areas of special

national or regional natural, recreational, scenic or historic value.

See section 160(2) of the CAA.

However, Congress did not restrict redesignation of additional

Class I areas by States and Tribes to lands deemed meritorious by the

Federal government. Rather, Congress gave States and Tribes broad

latitude to redesignate additional areas within their jurisdiction as

Class I. Congress generally limited EPA's authority to disapprove the

proposed redesignation of ``any'' area to circumstances where the

redesignation does not meet procedural requirements. See section

164(b)(2) of the CAA

There may be a variety of reasons for a State or Tribe to propose

redesignation of an area as Class I. One purpose of the PSD program is

to protect health and welfare from actual or potential adverse effects,

notwithstanding attainment of the national ambient air quality

standards. See section 160(1) of the CAA.

Another purpose of the PSD program is to assure that economic

growth will occur in a manner consistent with the preservation of

existing clean air resources. See section 160(3) of the CAA.

The Tribe's redesignation request provides as follows:

The Tribe is not seeking to change its air quality status to

prevent development on or around the reservation * * *. The Tribe is

against increased air pollution from industrial activity that could

cause serious health problems for the people living on or near the

Reservation * * *.

People are concerned about the increase in pollution under Class

II because of its anticipated effects on their most vulnerable age

groups: the very young and the elderly people on the Reservation. *

* *

The uncertainty that surrounds these absolute [NAAQS] leads the

Tribe to seek additional protection for the People and their finite

resources through the maintenance of the lowest levels of pollution

currently allowable: a Class I air quality designation.

See Yavapai-Apache Tribe Air Quality Redesignation Plan, Sept. 1993 at

ps. 27, 30 and 40. The Tribe's request also examines the natural

resource and cultural benefits of the proposed redesignation as well as

the unique nearby natural resources.

In the final analysis, it is generally inappropriate for EPA to

substitute its judgment for that of the Tribe's in these circumstances.

As discussed, Congress generally placed only procedural restrictions on

a Tribe's redesignation of non-Federal lands as Class I areas. The

legislative history indicates that limited Federal review was a

deliberate congressional decision.

5. Applicable Implementation Plan.

Some commenters stated that a redesignation cannot be approved

under section 164 of the CAA until there is an applicable state

implementation plan for the reservation. These commenters do not

believe that such a plan exists for this area, and therefore the

Tribe's request cannot be approved. The commenters reason that the

State does not have jurisdiction over the reservation, therefore no

applicable State implementation plan exists on the reservation and the

absence of an applicable State implementation plan precludes approval

of any Tribal redesignation.

Section 164 of the CAA makes no reference to an ``applicable state

implementation plan.'' Section 164(e), the dispute resolution

provisions, refers only to the ``applicable plan,'' providing that

EPA's decision resolving the dispute shall become part of the

applicable plan and shall be enforceable as part of such plan. Section

302(q) of the CAA in turn defines applicable implementation plan to

include a plan approved under section 110 of the CAA, a plan Federally-

promulgated under section 110(c) of the CAA or a plan approved or

promulgated under section 301(d) of the CAA. Thus, a redesignation

could be part of a state implementation plan (SIP), a Federal

implementation plan (FIP), or eventually, a tribal implementation plan

in accordance with sections 110(o) and 301(d) of the CAA. See 59 FR

43956.

The PSD regulations, however, provide that redesignations may be

[[Page 56468]]

proposed by states or tribes, ``subject to approval by the

Administrator as a revision to the applicable State implementation

plan.'' See 40 CFR 52.21(g)(1). At the time this language was

promulgated, the Agency had not clearly focused on the complex issues

of tribal sovereignty as it relates to States. Compare 59 FR 43956.

The PSD rules at 40 CFR part 52 establish a Federal PSD program, or

Federal implementation plan, where there would otherwise be gaps in

programmatic coverage.4 The Federal implementing rules expressly

apply to Indian reservations. See 40 CFR 52.21(a) (``the provisions [of

this section] shall also be applicable to all * * * Indian

Reservations). The Federal implementing regulations also expressly

provide for redesignations by Indian Tribes. See 40 CFR 52.21(g)(4).

---------------------------------------------------------------------------

\4\ See section 110(c)(1) of the CAA; see also Phillips

Petroleum Co. v. EPA, 803 F.2d 545, 555-56 (10th Cir. 1986)

(affirming EPA's authority to directly implement Safe Drinking Water

Act Underground Injection Control program on Indian lands in

Oklahoma where concluding otherwise would contradict the meaning and

purpose of the Act by creating ``a vacuum of authority over

underground injections on Indian lands, leaving vast areas of the

nation devoid of protection from groundwater'').

---------------------------------------------------------------------------

Based on the language in section 164(c) of the CAA and 40 CFR

52.21(g)(4) of the regulations expressly authorizing Tribes to

redesignate lands within reservation boundaries, it could not have been

EPA's intent at the time it promulgated the language in 40 CFR

52.21(g)(1) to frustrate the ability of Tribes to redesignate their

lands, and render meaningless the statutory and regulatory Tribal

redesignation authority, by requiring that there be an applicable State

implementation plan. Further, requiring that a State implementation

plan apply on a reservation before EPA would approve a Tribal

redesignation would be inappropriately treating Tribes as subdivisions

of States instead of relating to Tribes on a ``government-to-

government'' basis as called for by Federal policy. See part III.B.6,

below.

Thus, EPA interprets the regulatory provision to have the same

meaning as the statutory provision on which it is based, and to require

that redesignations become part of the applicable implementation plan.

Accordingly, for States, the applicable plan is the State

implementation plan as specifically recognized in the regulations.

Because Indian Tribes do not yet have authority to administer Tribal

implementation plans, the Federal PSD rules issued at 40 CFR 52.21

establish, pursuant to section 110(c)(1) of the CAA, the Federal

implementation plan as the applicable plan for the Tribe. See section

302(q) of the CAA. Thus, the redesignation approved today will become

part of the Federal implementation plan for the reservation.

6. Additional Public Comments.

One commenter expressed concern that the redesignation could be

detrimental to the economic well-being of the community. The commenter

also asserted that it appears to be ``both unnecessary and possibly

immoral'' to allow ``an extremely small minority of the population to

impose a significantly higher level of bureaucratic regulation.'' The

commenter encouraged EPA to suggest to the Tribe that it could pursue

more ``meaningful and productive opportunities.''

In the preceding discussion, EPA has attempted to address concerns,

and misimpressions, about potential economic impacts. Also as addressed

previously, the PSD program gives States and Federally recognized

Indian Tribes broad authority to redesignate lands within their

jurisdictional boundaries. That authority is not limited by the size of

population the requesting governmental entity represents or its

population relative to the surrounding jurisdictions.

EPA is also guided by Federal and Agency Tribal policy in making

decisions affecting Tribes. Washington Department of Ecology v. EPA,

752 F.2d 1465, 1471 & n. 5 (9th Cir. 1985). As outlined below, these

policies direct EPA to treat Tribes as sovereign governments.

On January 24, 1983, the President issued a Federal Indian Policy

stressing two related themes: (1) That the Federal government will

pursue the principle of Indian ``self-government'' and (2) that it will

work directly with Tribal governments on a ``government-to-government''

basis. An April 29, 1994 Presidential Memorandum reiterated that the

rights of sovereign Tribal governments must be fully respected. 59 FR

22951 (May 4, 1994).

EPA's Tribal policies commit to certain principles, including the

following:

EPA recognizes Tribal Governments as sovereign entities with

primary authority and responsibility for the reservation populace.

Accordingly, EPA will work directly with Tribal Governments as the

independent authority for reservation affairs, and not as the

political subdivisions of States or other governmental units.

* * * * *

In keeping with the principal of Indian self-government, the

Agency will view Tribal Governments as the appropriate non-Federal

parties for making decisions and carrying out program

responsibilities affecting Indian reservations, their environments,

and the health and welfare of the reservation populace. Just as

EPA's deliberations and activities have traditionally involved

interests and/or participation of State Governments, EPA will look

directly to Tribal Governments to play this lead role for matters

affecting reservation environments.

See November 8, 1984 ``EPA Policy for the Administration of

Environmental Programs on Indian Reservations''; Policy Reaffirmed by

Administrator Carol M. Browner in a Memorandum issued on March 14,

1994.

Congress further enhanced Tribal sovereignty under the CAA in the

1990 amendments. The 1990 amendments added sections 110(o) and 301(d)

to the CAA, which provide for administration of specified CAA programs

in the same manner as States. These provisions further evidence strong

Congressional commitment to tribal sovereignty and the desire to put

tribes on an equal footing with states with regard to managing air

quality resources. See 59 FR 43956.

The United States also has a unique fiduciary relationship with

Tribes, and EPA must consider Tribal interests in its actions. Nance v.

EPA, 645 F.2d at 710.

It would be inappropriate, under Federal law and policy, for EPA to

disapprove the Tribe's request to seek additional protection of the

reservation environment for the reasons suggested by the commenter.

EPA also received a comment from the attorney for the Town of

Clarkdale objecting ``to the lack of procedural due process in the

conduct of the Public Hearing held by EPA on * * * June 22, 1994.'' The

commenter alleged that the EPA hearing officer was unfair and impartial

because the Hearing Officer asked the attorney to conclude his comments

when a five-minute time limit had been exceeded, some proponents of the

project who spoke exceeded the five-minute time limit without

interruption from the hearing officer, and the hearing officer failed

to control applause and verbal expressions by members of the audience

supporting the request which had the effect of a ``chilling process''

on any person in attendance intending to make public comment in

opposition. The commenter therefore alleged that the entire EPA review

process is tainted.

An opportunity for a public hearing is expressly provided for in

conjunction with EPA disapproval of a redesignation request. Section

164(b)(2) of the CAA provides that EPA may disapprove an area

redesignation request only if it finds ``after notice and opportunity

for public hearing,'' that the redesignation

[[Page 56469]]

does not meet the applicable procedural requirements. EPA's

implementing regulations similarly provide that EPA shall disapprove,

within 90 days of submission, a redesignation request only if it finds

``after notice and opportunity for public hearing'' that the

redesignation does not meet the applicable procedural requirements. See

40 CFR 52.21(g)(5).

On April 18, 1994, EPA published a notice of proposed rulemaking in

the Federal Register proposing to approve the Tribe's Class I

redesignation request based on EPA's preliminary determination that it

met the applicable procedural requirements, and announced a 30-day

public comment period. See 59 FR 18346. EPA subsequently held the June

22, 1994 public hearing in question to be responsive to a request for a

public hearing from the Town of Clarkdale attorney. In the announcement

of the public hearing, EPA indicated that it would allow until July 6,

1994 for the submittal of written comments following the public

hearing.

To facilitate the public's understanding of the issues, EPA began

the public hearing with an informational discussion of the Class I

redesignation process and an overview of the PSD permit program.

Subsequently, a panel of EPA officials, including a presiding hearing

officer, heard oral presentations from members of the public.

In her introductory remarks the presiding officer made the

following statement:

Please make your oral comments brief so that everyone has an

opportunity to speak. To assist in this effort, please limit your

comments to five minutes. If you have lengthier comments or comments

that contain a significant amount of technical detail, I would ask

that you submit them in writing before the end of the comment

period. If you brought a written copy of your remarks with you

today, you may hand it to the reporter after your testimony for

inclusion in the record of the hearing.

See Hearing Transcript at p. 6.

The Town of Clarkdale attorney was the first speaker at the public

hearing. After he spoke for approximately 10 minutes, the presiding

officer asked him to conclude his comments in order to ensure that

everyone would have time to speak. After providing those who expressed

an interest in making an oral presentation with an opportunity to

speak, EPA provided time for any additional comment including

supplementary statements by those who had previously spoken.

EPA has reviewed the transcript and a videotape of the public

hearing. The Town of Clarkdale attorney had a fair and reasonable

opportunity to express his views at the public hearing during his

statements at the outset of the hearing and again at the end of the

hearing when EPA provided an opportunity for additional statements.

Everyone present was afforded an equal opportunity to speak. While some

members of the audience did applause and comment in response to the

statements of others, their conduct did not create an intimidating or

``chilling'' atmosphere.

Further, EPA provided additional opportunities for submission of

views to the Agency. As noted, in its announcement of the public

hearing, EPA stated that it would consider post-hearing written

comments submitted by July 6, 1994. Following the public hearing, the

Town of Clarkdale requested an extension of the public comment period

``[t]o allow additional time for the public to respond to information

presented by EPA and the public comment at the Public Hearing'' and

``[t]o allow for public comment not made at the Public Hearing of June

22, 1994, by reason of curtailment of opposing viewpoints.'' On July

20, 1994, in response to the Town of Clarkdale's request, EPA published

a Federal Register document announcing an extension of the public

comment period, providing the public until August 22, 1994 to submit

written comments. See 59 FR 37018. The Town of Clarkdale submitted

public comments dated August 22, 1994, in addition to several other

written communications with EPA both preceding and following the EPA

public hearing.

EPA has satisfied the procedures required by law, and arguably

more, in reviewing the Tribe's PSD redesignation request. EPA has

provided ample opportunity for public participation and has fully

considered the resulting public comments in taking today's final

action. EPA has acted well within its lawful discretion. See Vermont

Yankee Nuclear Power Co. v. NRDC, 435 U.S. 519 (1978).

IV. Administrative Review

A. Executive Order 12866

The Office of Management and Budget has exempted this rulemaking

action from centralized regulatory review pursuant to section 6 of

Executive Order 12866.

B. Regulatory Flexibility Act

Under the Regulatory Flexibility Act, 5 U.S.C. Section 600 et seq.,

EPA must prepare a regulatory flexibility analysis describing the

impact of a final rule on small entities. See 5 U.S.C. sections 603 and

604. Alternatively, EPA may certify that the rule will not have a

significant economic impact on a substantial number of small entities.

Small entities include small businesses, small not-for-profit

enterprises and government entities with jurisdiction over populations

of less than 50,000. This final rulemaking action to approve the

Tribe's PSD redesignation request does not impose new requirements on

small entities and may only potentially have an impact on major

stationary sources, as defined by 40 CFR 52.21. Therefore, I certify

that this action will not have a significant economic impact on a

substantial number of small entities.

C. Unfunded Mandates

Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), P.L.

104-4, establishes requirements for Federal agencies to assess the

effects of their regulatory actions on State, local, and tribal

governments and the private sector. Under section 202 of the UMRA, EPA

generally must prepare a written statement, including a cost-benefit

analysis, for proposed and final rules with ``Federal mandates'' that

may result in expenditures to State, local, and tribal governments, in

the aggregate, or to the private sector, of $100 million or more in any

one year. Before promulgating an EPA rule for which a written statement

is needed, section 205 of the UMRA generally requires EPA to identify

and consider a reasonable number of regulatory alternatives and adopt

the least costly, most cost-effective or least burdensome alternative

that achieves the objectives of the rule and is consistent with

statutory requirements. Section 205 allows EPA to adopt an alternative

other than the least costly, most cost-effective or least burdensome

alternative if EPA publishes with the final rule an explanation why

that alternative was not adopted.

EPA has determined that this final rulemaking action to approve the

Tribe's PSD redesignation request does not contain Federal mandates

that may result in expenditures of $100 million or more for State,

local, and tribal governments, in the aggregate, or the private sector

in any one year. Thus, this action is not subject to the requirements

of sections 202 and 205 of the UMRA.

D. Submission to Congress and the General Accounting Office

Under 5 U.S.C. 801(a)(1)(A) as added by the Small Business

Regulatory Enforcement Fairness Act of 1996, EPA submitted a report

containing this rule

[[Page 56470]]

and other required information to the U.S. Senate, the U.S. House of

Representatives and the Comptroller General of the General Accounting

Office prior to publication of this rule in today's Federal Register.

This rule is not a ``major rule'' as defined by 5 U.S.C. 804(2).

List of Subjects in 40 CFR Part 52

Environmental protection, Air pollution control, Carbon monoxide,

Hydrocarbons, Intergovernmental relations, Nitrogen dioxide, Ozone,

Particulate matter, Reporting and recordkeeping requirements, Sulfur

oxides.

Dated: October 2, 1996.

Felicia Marcus,

Regional Administrator.

40 CFR part 52 is amended as follows:

PART 52--[AMENDED]

1. The authority citation for part 52 continues to read as follows:

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

Subpart D--Arizona

2. Subpart D is amended by adding Sec. 52.150 to read as follows:

Sec. 150 Yavapai-Apache Reservation.

(a) The provisions for prevention of significant deterioration of

air quality at 40 CFR 52.21 are applicable to the Yavapai-Apache

Reservation, pursuant to Sec. 52.21(a).

(b) In accordance with section 164 of the Clean Air Act and the

provisions of 40 CFR 52.21(g), the Yavapai-Apache Indian Reservation is

designated as a Class I area for the purposes of preventing significant

deterioration of air quality.

[FR Doc. 96-27849 Filed 10-31-96; 8:45 am]

BILLING CODE 6560-50-P