Approval and Promulgation of Implementation Plans; Revision to the Indiana State Implementation Plan for Ozone

ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[IN58-1-7216a; FRL-5342-9]

Approval and Promulgation of Implementation Plans; Revision to

the Indiana State Implementation Plan for Ozone

AGENCY: Environmental Protection Agency (USEPA).

ACTION: Direct final rule.

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SUMMARY: The USEPA approves the State Implementation Plan (SIP)

revision request submitted by the State of Indiana on August 25, 1995,

establishing a summertime gasoline Reid Vapor Pressure (RVP) limit of

7.8 pounds per square inch (psi) for gasoline distributed in Clark and

Floyd Counties, as part of the State's plan to attain 15 percent (%)

Reasonable Further Progress (RFP) reductions of Volatile Organic

Compounds (VOC) emissions in these two Counties by 1996. Emissions of

VOC react with other pollutants, such as oxides of nitrogen, on hot

summer days to form ground-level ozone, commonly known as smog. Ozone

pollution is of particular concern because of its harmful effects upon

lung tissue and breathing passages. RFP plans are intended to bring

areas which have been exceeding the public health-based Federal ozone

air quality standard closer toward the goal of attaining and

maintaining this standard. Indiana expects that the summertime RVP

gasoline limit will reduce VOC emissions by 2.29 tons per day in the

Clark and Floyd Counties ozone nonattainment area. A final approval

action is being taken because the submittal meets all pertinent Federal

requirements.

DATES: The ``direct final'' is effective on April 9, 1996, unless USEPA

receives adverse or critical comments by March 11, 1996. If the

effective date is delayed, timely notice will be published in the

Federal Register.

ADDRESSES: Copies of the revision request is available for inspection

at the following address: U.S. Environmental Protection Agency, Region

5, Air and Radiation Division, 77 West Jackson Boulevard, Chicago,

Illinois 60604. (It is recommended that you telephone Mark J. Palermo

at (312) 886-6082 before visiting the Region 5 Office.)

Written comments should be sent to: J. Elmer Bortzer, Chief,

Regulation Development Section, Regulation Development Branch (AR-18J),

U.S. Environmental Protection Agency, 77 West Jackson Boulevard,

Chicago, Illinois 60604.

FOR FURTHER INFORMATION CONTACT: Mark J. Palermo at (312) 886-6082.

SUPPLEMENTARY INFORMATION:

I. Background

RVP is a measure of a fuel's volatility and thereby affects the

rate at which gasoline evaporates and emits VOC; the lower the RVP, the

lower the rate of evaporation. The RVP of gasoline can be lowered by

reducing the amount of its volatile components, such as butane.

Lowering RVP in the summer months can offset the effect of summer

temperature upon the volatility of gasoline, which in turn lowers

emissions of VOC. Because VOC is a necessary component in the

production of ground level ozone in hot summer months, reduction of RVP

will assist the State of Indiana to attain the National Ambient Air

Quality Standard (NAAQS) for ozone, which all States must promulgate

SIPs to achieve under section 110(a) of the Act.

The USEPA first proposed to regulate gasoline RVP in 1987 (52 FR

31274). USEPA's gasoline RVP proposal resulted in a two-phased final

regulation which was incorporated into the 1990 Amendments to the Clean

Air Act (Act) in section 211(h). Phase I of the regulation took effect

in 1990 (54 FR 11868) for the years 1990 and 1991. Phase II of the

regulation became effective in 1992 (55 FR 23658). The rule divides the

continental United States into two control regions, Class B and Class

C. Generally speaking, the Class B states are the warmer southern and

western states, and Class C states are the cooler northern states. The

Phase II regulation limits the volatility of gasoline sold during the

high ozone season to 9.0 psi RVP for Class C areas and 7.8 psi RVP for

Class B ozone nonattainment areas. Indiana is a Class C State, and

therefore, required under the Federal rule to meet the 9.0 psi RVP

standard.

State governments are generally preempted under section

211(c)(4)(A) of the Act from requiring any or all areas in a state to

meet a more stringent volatility standard.1 However, a state can

require a more stringent standard in its SIP if the state can show

under section 211(c)(4)(C) that the more stringent standard is

necessary to achieve the National Ambient Air Quality Standard (NAAQS)

for ozone in a particular nonattainment area. The state can make this

showing by providing evidence that no other measures exist that would

bring about timely attainment, or that such measures exist and are

technically possible to implement, but are unreasonable or impractical.

If a state makes this showing, it can lower the RVP of gasoline to

whatever level has been shown to be necessary in the nonattainment

area(s).

\1\ USEPA's federal standards were promulgated under both

section 211(c) and section 211(h). States are generally preempted

under section 211(c)(4)(A) from requiring fuel standards promulgated

under section 211(c).

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II. State Submittal

Section 182 of the Act requires all moderate, serious, severe, and

extreme ozone nonattainment areas to submit an RFP plan to achieve a

15% reduction of 1990 emissions of VOC by 1996. In Indiana, Clark and

Floyd Counties are classified as moderate nonattainment for ozone, and

as such, subject to the 15% RFP requirement. See 40 CFR 81.315.

The Indiana Department of Environmental Management (IDEM) developed

and submitted a plan to USEPA on July 12, 1995, outlining the VOC

emission control measures which will be implemented in order to satisfy

the 15% RFP requirement for Clark and Floyd Counties. USEPA is

currently reviewing the plan. One of the measures identified in the

Clark and Floyd Counties plan is a summertime gasoline RVP limit of 7.8

psi. On August 3, 1994, the Indiana Air Pollution Control Board (IAPCB)

held a preliminary adoption hearing on a proposed rule to limit

summertime gasoline RVP to 7.8 psi, and on January 11, 1995, the IAPCB

adopted the rule. The rule became effective on August 5, 1995, and was

published in the Indiana State Register on August 1, 1995. IDEM

formally submitted the RVP rule to USEPA on August 25, 1995, as a

revision to the Indiana ozone SIP. USEPA made a finding of completeness

of this SIP revision in a letter dated October 2, 1995.

In the 15% RFP plan for Clark and Floyd Counties, Indiana reviewed

all reasonable control measures and calculated the total reductions

that it could achieve through these measures. The plan's modeling

demonstrates that limiting the RVP of gasoline to 7.8 reduces emissions

in Clark and Floyd Counties by approximately 2.29 tons per day.

``Opt-in'' into the Federal reformulated gasoline program, pursuant

to section 211(k)(6) of the Act, could also achieve this amount of

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emission reduction, but could not be implemented in time to qualify as

a control measure which could help Clark and Floyd Counties meet 15%

RFP reductions by 1996. Other reasonable control measures which could

possibly achieve this degree of emission reduction, such as Stage II

vapor recovery, enhanced vehicle Inspection/Maintenance, or new

Reasonably Available Control Technology requirements for stationary

sources, are already part of the RFP plan for Clark and Floyd Counties.

Indiana has therefore selected the RVP control because it is the

only other reasonable and practicable emission control option available

to the Clark and Floyd County area 15% RFP plan, and gasoline RVP

control is necessary to ensure timely attainment with the NAAQS for

ozone. On this basis, USEPA has found that Indiana has sufficiently

justified establishing a 7.8 psi summertime gasoline RVP limit under

section 211(c)(4)(C) of the Act.

III. Analysis of Rule

The Indiana RVP rule specifies that the gasoline distributed in

Clark and Floyd Counties by all refineries, importers, carriers, or

terminals between May 1 and September 15, and all retail stations and

other end users who sell or dispense gasoline between June 1 and

September 15, must meet a RVP standard of 7.8 psi or less per gallon.

The rule provides a 1.0 psi volatility waiver for ethanol blended fuels

and establishes reformulated gasoline (RFG) as a compliant fuel in

order to allow gasoline distributors who sell only RFG to maintain a

presence in Clark and Floyd Counties. In addition, the Indiana RVP rule

requires all parties involved with the marketing of gasoline to

maintain records indicating that the volatility of each gasoline

shipment meets the 7.8 psi limit. The control period, ethanol blend

waiver, and recordkeeping requirements, are all consistent with the Act

and USEPA's final RVP rule (55 FR 23658). Reformulated gasoline is

suitable as a compliant fuel because it achieves slightly higher

emission reductions than gasoline with 7.8 psi RVP.

IDEM will oversee compliance with this rule. Gasoline sampling and

testing to assure compliance with the regulation began in the summer of

1995. Sampling will be performed in accordance with the procedures

described by USEPA in its gasoline volatility regulations in 40 CFR

part 80, Appendix D. Gasoline volatility and ethanol content tests will

be performed following procedures described by USEPA in 40 CFR part 80,

Appendices E and F, respectively. The Indiana Code (IC) 13-7-13-1,

states that any person who violates any provision of IC 13-1-1, IC 13-

1-3, or IC 13-1-11, or any regulation or standard adopted by one (1) of

the boards (i.e., IAPCB), or who violates any determination, permit, or

order made or issued by the commissioner (of IDEM) pursuant to IC 13-1-

1, or IC 13-1-3, is liable for a civil penalty not to exceed twenty-

five thousand dollars per day of any violation. Because this submittal

is a regulation adopted by the IAPCB, a violation of which subjects the

violator to penalties under IC 13-7-13-1, and because a violation of

the ozone SIP would also subject a violator to enforcement under

section 113 of the Act by USEPA, USEPA finds that the submittal

contains sufficient enforcement penalties for approval. In addition,

IDEM has submitted a civil penalty policy document which accounts for

various factors in the assessment of an appropriate civil penalty for

noncompliance with IAPCB rules, among them, the severity of the

violation, intent of the violator, and frequency of violations. USEPA

finds these criteria sufficient to deter non-compliance.

IV. Final Rulemaking Action

The USEPA approves the SIP revision submitted by the State of

Indiana. The State of Indiana has submitted a SIP revision which

includes enforceable state regulations consistent with Federal

requirements. Indiana has already conducted inspections at about one-

third of the regulated facilities during the first season of

compliance. Substantial penalties which will provide an adequate

incentive for the regulated industry to comply and are no less than the

expected cost of compliance are included in current Pollution Control

Board Regulation. USEPA is, therefore, approving this submittal.

Procedural Background

The USEPA is publishing this action without prior proposal because

USEPA views this action as a noncontroversial revision and anticipates

no adverse comments. However, USEPA is publishing a separate document

in this Federal Register publication, which constitutes a ``proposed

approval'' of the requested SIP revision and clarifies that the

rulemaking will not be deemed final if timely adverse or critical

comments are filed. The ``direct final'' approval shall be effective on

April 9, 1996, unless USEPA receives adverse or critical comments by

March 11, 1996. If USEPA receives comments adverse to or critical of

the approval discussed above, USEPA will withdraw this approval before

its effective date by publishing a subsequent Federal Register document

which withdraws this final action. All public comments received will

then be addressed in a subsequent rulemaking document. Please be aware

that USEPA will institute another comment period on this action only if

warranted by significant revisions to the rulemaking based on any

comments received in response to today's action. Any parties interested

in commenting on this action should do so at this time. If no such

comments are received, USEPA hereby advises the public that this action

will be effective on April 9, 1996.

This action has been classified as a Table 3 action for signature

by the Regional Administrator under the procedures published in the

Federal Register on January 19, 1989 (54 FR 2214-2225), as revised by a

July 10, 1995, memorandum from Mary D. Nichols, Assistant Administrator

for Air and Radiation. The Office of Management and Budget (OMB) has

exempted this regulatory action from Executive Order 12866 review.

Nothing in this action should be construed as permitting, allowing

or establishing a precedent for any future request for revision to any

SIP. USEPA shall consider each request for revision to the SIP in light

of specific technical, economic, and environmental factors and in

relation to relevant statutory and regulatory requirements.

Section 202 of the Unfunded Mandates Reform Act of 1995 (``Unfunded

Mandates Act'') (signed into law on March 22, 1995) requires that the

USEPA prepare a budgetary impact statement before promulgating a rule

that includes a Federal mandate that may result in expenditure by

State, local, and tribal governments, in aggregate, or by the private

sector, of $100 million or more in any one year. Section 203 requires

the USEPA to establish a plan for obtaining input from and informing,

educating, and advising any small governments that may be significantly

or uniquely affected by the rule.

Under section 205 of the Unfunded Mandates Act, the USEPA must

identify and consider a reasonable number of regulatory alternatives

before promulgating a rule for which a budgetary impact statement must

be prepared. The USEPA must select from those alternatives the least

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

achieves the objectives of the rule, unless the USEPA explains why this

alternative is not selected or

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the selection of this alternative is inconsistent with law.

This final rule only approves the incorporation of existing state

rules into the SIP and imposes no additional requirements. This rule is

estimated to result in the expenditure by State, local, and tribal

governments or the private sector of less then $100 million in any one

year. USEPA, therefore, has not prepared a budgetary impact statement

or specifically addressed the selection of the least costly, most cost-

effective, or least burdensome alternative. Furthermore, because small

governments will not be significantly or uniquely affected by this

rule, the USEPA is not required to develop a plan with regard to small

governments.

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

USEPA must prepare a regulatory flexibility analysis assessing the

impact of any proposed or final rule on small entities. (5 U.S.C.

sections 603 and 604.) Alternatively, USEPA may certify that the rule

will not have a significant 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.

SIP approvals under section 110 and subchapter I, part D of the

Clean Air Act do not create any new requirements, but simply approve

requirements a State has already imposed. Therefore, because the

Federal SIP-approval does not impose any new requirements, I certify

that it does not have a significant impact on any small entities

affected. Moreover, due to the nature of the Federal-State relationship

under the Act, preparation of a regulatory flexibility analysis would

constitute Federal inquiry into the economic reasonableness of the

State action. The Clean Air Act forbids USEPA to base its actions

concerning SIPs on such grounds. Union Electric Co. v. USEPA., 427 U.S.

246, 256-66 (S.Ct. 1976); 42 U.S.C. section 7410(a)(2).

Under section 307(b)(1) of the Clean Air Act, petitions for

judicial review of this action must be filed in the United States Court

of Appeals for the appropriate circuit by April 9, 1996. Filing a

petition for reconsideration by the Administrator of this final rule

does not affect the finality of this rule for the purposes of judicial

review nor does it extend the time within which a petition for judicial

review may be filed, and shall not postpone the effectiveness of such

rule or action. This action may not be challenged later in proceedings

to enforce its requirements. (See Section 307(b)(2)).

List of Subjects in 40 CFR Part 52

Environmental protection, Air pollution control, Hydrocarbon,

Incorporation by reference, Ozone.

Dated: November 21, 1995.

Valdas V. Adamkus,

Regional Administrator.

For the reasons stated in the preamble, part 52, chapter I, title

40 of the Code of Federal Regulations 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 P--Indiana

2. Section 52.770 is amended by adding paragraph (c)(101) to read

as follows:

Sec. 52.770 Identification of plan.

* * * * *

(c) * * *

(101) On August 25, 1995, Indiana submitted a regulation which

reduced the maximum allowable volatility for gasoline sold in Clark and

Floyd Counties to 7.8 psi during the summer control period. The summer

control period is June 1, to September 15, for retail outlets and

wholesale customers, and May 1, to September 15, for all others.

(i) Incorporation by reference. 326 Indiana Administrative Code 13-

3 Control of Gasoline Reid Vapor Pressure. Sections 1 through 7.

Finally adopted by the Indiana Air Pollution Control Board January 11,

1995. Signed by the Secretary of State July 6, 1995. Effective August

5, 1995. Published at Indiana Register, Volume 18, Number 11, August 1,

1995.

[FR Doc. 96-2826 Filed 2-8-96; 8:45 am]

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