Control of Air Pollution; Amendments to Emission Requirements Applicable to New Nonroad Compression-Ignition Engines at or Above 37 Kilowatts: Provisions for Replacement Compression-Ignition Engines and the Use of On-Highway Compression-Ignition Engines in Nonroad Vehicles

SUMMARY: This rulemaking amends the regulations applicable to

compression-ignition nonroad engines at or above 37 kilowatts (kW) to

address two disruptive situations that have arisen regarding the

implementation of regulations applicable to these nonroad engines. No

air quality impact is expected from these amendments.

These amendments will allow nonroad vehicle manufacturers to use

certified on-highway engines in nonroad vehicles that are constructed

from on-highway vehicles or that must use public roads between job

sites. These amendments also will allow engine manufacturers to provide

uncertified replacement engines to repower pre-regulation nonroad

equipment when that equipment experiences major engine failure.

DATES: This final rule is effective January 13, 1997 unless adverse or

critical comments are received by December 12, 1996. If the effective

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

Register.

ADDRESSES: Written comments should be addressed to: EPA Air Docket (LE-

131), Attention: Docket Number A-96-37, room M-1500, 401 M Street, SW.,

Washington, DC 20460 (telephone 202-260-7548, fax 202-260-4400). Please

contact the individual listed below before submitting comments.

Materials relevant to this rulemaking are contained in the docket

listed above and may be reviewed at that location from 8:00 a.m. until

5:30 p.m. Monday through Friday. As provided in 40 CFR Part 2, a

reasonable fee may be charged by EPA for photocopying.

FOR FURTHER INFORMATION CONTACT: John Guy, Office of Mobile Sources,

Engine Programs and Compliance Division (6403J), 401 M Street SW.,

Washington, DC 20460, 202-233-9276.

SUPPLEMENTARY INFORMATION:

I. Regulated Entities

Entities potentially regulated by this action are those which

manufacture and use compression ignition engines of 37 kW or greater.

Regulated categories and entities include:

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Category Examples of regulated entities

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Industry.......................... Manufacturers and users of

compression ignition engines of 37

kW or greater.

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This table is not intended to be exhaustive, but rather provides a

guide for readers regarding entities likely to be regulated by this

action. This table lists the types of entities that EPA is now aware

could potentially be regulated by this action. Other types of entities

not listed in the table could also be regulated. To determine whether

your product is regulated by this action, you should carefully examine

the applicability criteria in Sec. 89.1 of title 40 of the Code of

Federal Regulations. If you have questions regarding the applicability

of this action to a particular product, consult the person listed in

the preceding FOR FURTHER INFORMATION CONTACT section.

II. Obtaining Copies of the Regulatory Language

Electronic Copies of Rulemaking Documents

Electronic copies of the preamble and the regulatory text of this

rulemaking are available via the Internet on the Office of Mobile

Sources (OMS) Home Page (http://www.epa.gov/OMSWWW/). Users can find

Nonroad Engines and Vehicles information and documents through the

following path once they have accessed the OMS Home Page: ``Nonroad

Engines and Vehicles,'' ``Large Engines''. Electronic copies of the

preamble and the regulatory text of this rulemaking are also available

on the Office of Air Quality Planning and Standards (OAQPS) Technology

Transfer Network Bulletin Board System (TTN BBS). Users are able to

access and download TTN BBS files on their first call. After logging

onto TTN BBS, to navigate through the BBS to the files of interest, the

user must enter the appropriate command at each of a series of menus.

The steps required to access information on this rulemaking are listed

below. The service is free, except for the cost of the phone call.

TTN BBS: 919-541-5742 (1,200-14,400 bps, no parity, eight data

bits, one stop bit). Voice help: 919-541-5384 Internet address: TELNET

ttnbbs.rtpnc.epa.gov Off-line: Mondays from 8:00-12:00 Noon ET.

1. Technology Transfer Network Top Menu: GATEWAY TO TTN TECHNICAL AREAS

(Bulletin Boards)

2. TTN TECHNICAL INFORMATION AREAS: OMS--Mobile Sources Information

3. OMS BBS===MAIN MENU FILE TRANSFERS: Rulemaking & Reporting

4. RULEMAKING PACKAGES: Nonroad

5. Nonroad Rulemaking Area: File Area #2 . . . Nonroad Engines

6. Nonroad engines

At this stage, the system will list all available nonroad engine

files. To download a file, select a transfer protocol which will match

the terminal software on your computer, then set your own software to

receive the file using that same protocol.

If unfamiliar with handling compressed (i.e., ZIP'd) files, go to

the TTN topmenu, System Utilities (Command: 1) for information and the

necessary program to download in order to unZIP the files of interest

after downloading to your computer. After getting the files you want

onto your computer, you can quit TTN BBS with the oodbye command.

III. Table of Contents

IV. Statutory Authority and Background

A. Statutory Authority

B. Background

V. Use of On-highway Engines in Nonroad Vehicles

A. Discussion

B. Regulatory Approach

VI. Use of Uncertified Engines for Replacement of Failed Engines in

Older Equipment

A. Discussion

B. Regulatory Approach

VII. Final Action

VIII. Cost Effectiveness

IX. Administrative Requirements

A. Administrative Designation

B. Reporting and Recordkeeping Requirements

C. Impact on Small Entities

D. Submission to Congress and the General Accounting Office

E. Unfunded Mandates Act

IV. Statutory Authority and Background

A. Statutory Authority

Authority for the actions in this notice is granted to EPA by

sections 202, 203, 204, 205, 206, 207, 208, 209, 213, 215, 216, and 301

of the Clean Air Act as amended (42 U.S.C. 7521, 7522, 7523, 7524,

7525, 7541, 7542, 7543, 7547, 7549, 7550, and 7601(a).

[[Page 58103]]

B. Background

EPA promulgated final regulations applicable to nonroad

compression-ignition engines at or above 37 kilowatts (kW) (large CI

engines) on June 17, 1994 (59 FR 31306). These regulations are being

phased in based on engine power. New engines greater than or equal to

130 kW and less than or equal to 560 kW were subject to the

requirements beginning on January 1, 1996. The other implementation

dates are January 1, 1997 for new engines greater than or equal to 75

kW and less than 130 kW; January 1, 1998 for new engines greater than

or equal to 37 kW and less than 75 kW; and January 1, 2000 for new

engines greater than 560 kW.

The rule, at 40 CFR 89.1003(a)(1)(i), prohibits nonroad engine

manufacturers from introducing into commerce any nonroad engine to

which emission requirements are applicable unless the engine is covered

by a certificate of conformity issued by EPA under the regulations for

nonroad engines. The rule also prohibits vehicle or equipment

manufacturers from introducing into commerce any nonroad vehicle or

equipment unless the engine in the vehicle or equipment is certified to

the applicable nonroad emission requirements.1 (40 CFR

89.1003(a)(6) and (b)(4)).

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\1\ The regulations also prohibit, in the case of any person,

the importation of engines after the applicable implementation date

for the engine, or vehicles or equipment containing such engine,

unless the engine is covered by a certificate of conformity. 40 CFR

89.1003(a)(1)(ii).

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Since the first implementation date, two unintended side effects of

the rule's prohibitions have become evident which pose hardships for

vehicle and/or engine manufacturers. The first concerns some nonroad

vehicle manufacturers that have indicated a need to use certified on-

highway engines in nonroad vehicles. This includes those vehicles that

must use public roads between job sites and nonroad vehicles built from

on-highway trucks that can not be obtained with certified nonroad

engines. The second side effect involves the inability of engine

manufacturers to provide replacement engines to repower pre-regulation

nonroad equipment when that equipment experiences major engine failure.

The amendments in this package will alleviate both problems.

V. Use of On-highway Engines in Nonroad Vehicles

A. Discussion

As the phase-in date for each category of large CI engines passes,

the existing regulations take effect to prohibit engine manufacturers

from introducing into commerce uncertified nonroad large CI engines of

that category. The regulations also prohibit nonroad vehicle

manufacturers from installing engines to which regulations are

applicable in their vehicles unless the engines have been certified by

EPA to meet the nonroad emission standards. The rationale for the

prohibition applicable to vehicle manufacturers is given in the

preamble to the final rule:

Without a requirement that certified engines be used, nonroad

vehicle and equipment manufacturers would be free to use uncertified

engines thus undermining the environmental and public health

benefits of the nonroad * * * engine * * * program. 59 FR 31324.

Several manufacturers of mobile construction equipment, such as

mobile excavators and cranes, have written EPA individually for

permission to use certified on-highway engines to propel vehicles that

are, by definition, nonroad vehicles but nevertheless must travel

significant mileage on public roads between job sites. One applicant

indicated that some purchasers of its equipment drive as much as 30,000

miles per year. Based on the submittals of these manufacturers, these

vehicles benefit from certain performance and/or safety features,

notably engine braking devices, which are available on on-highway

engines, but are not typically available on non-road engines.

Another firm, which converts on-highway trucks into dedicated

nonroad agricultural chemical applicators has asked for relief from the

requirement to install certified non-road engines so that it does not

have to remove and dispose of the certified on-highway engines that

come with the base trucks it purchases and then replace them with

certified nonroad engines.

In separate letters to each applicant, EPA's Office of Mobile

Sources and Office of Enforcement and Compliance Assurance stated that

EPA would exercise enforcement discretion and granted permission to use

on-highway engines through December 31, 1997 subject to certain

specific conditions. EPA is incorporating those conditions in this

rulemaking. EPA's permission letters indicated EPA's intention to amend

the rules and explained that:

* * * your company, although not using a certified nonroad engine as

required, would still be using a certified engine, albeit a

certified on-highway engine. We do not believe that the

environmental and public health benefits of the nonroad engine

program would be undermined by your use of certified on-highway

engines which require greater technological innovation to meet

applicable standards.

The incoming letters and EPA's responses are available in the

docket.

The Agency believes that nonroad vehicles should be equipped with

nonroad engines but believes flexibility is appropriate for vehicles

that: (1) must frequently operate on-highway in cases where suitable

non-road engines are not available; or (2) are derived from on-highway

vehicles which are not available with suitable nonroad engines.

Therefore, we are amending the rule to permit the use of on-highway

engines in cases like those above, provided that certified nonroad

engines with appropriate performance or safety characteristics are not

available or are not available in the base on-highway vehicle (for

vehicle conversions).

In the Notice of Proposed Rulemaking for the large CI rule (58 FR

28809, May 17, 1993), EPA proposed that engine manufacturers be allowed

to use the transient on-highway test as an alternative test procedure

to certify nonroad engines. This would have allowed certified on-

highway engines to also obtain nonroad certification and would

effectively have eliminated the problems faced by the specialty vehicle

manufacturers described above. However, comments and data received from

industry during the comment period indicated that the ability of the

on-highway test cycle to predict nonroad NOX emissions was

uncertain. Therefore, the provision was not finalized.

Today's action does not attempt to make assertions about the

ability of the on-highway engine test procedure to yield comparable

NOX results to the nonroad test procedure. Nor does it provide any

sort of automatic nonroad certification for on-highway engines. What it

does do is establish provisions to use on-highway engines in situations

where nonroad vehicles are either derived from motor vehicles or are

operated like motor vehicles and therefore require features associated

with motor vehicle engines. Many of the vehicles, such as cranes and

excavators, covered under the permission letters mentioned above are

designed to be driven on public roads but are considered nonroad

vehicles because their size or weight exceeds the thresholds that EPA

uses to separate motor vehicles from nonroad vehicles. They often have

smaller ``sibling'' vehicles that fit within EPA's motor vehicle

criteria and are required to use motor vehicle engines. Because of the

way these nonroad vehicles are operated, it seems appropriate that they

be allowed to have engines that were tested on the on-highway cycle and

meet the on-highway standards. Many

[[Page 58104]]

of these vehicles are equipped with two engines, one for propulsion

around and between job sites and one to power the craning or excavating

features of the vehicle. The propulsion engine is generally shut off

once the vehicle is positioned at the job site. In such vehicles, it is

only the propulsion engine which would be permitted to be an on-highway

engine.

EPA does not believe that allowing these vehicles to use certified

on-highway engines will have a detrimental effect on emissions.

Although EPA is not asserting that engines tested using the on-highway

test would meet the same level of emissions if tested using the nonroad

test, EPA believes that, given the current standards for on-highway

heavy duty engines which require substantially greater technological

innovation than current nonroad standards, and given the general uses

of the engines, discussed above, emissions of such engines are unlikely

to be higher for such equipment in-use than they would be if certified

nonroad engines were used.

B. Regulatory Approach

The Agency is implementing the desired changes by amending the

existing Prohibited Acts section at 40 CFR 89.1003. The amendments

alter the strict language which prohibits the use of engines other than

certified nonroad engines in nonroad vehicles to permit the use of

certified on-highway engines under the circumstances outlined above.

Although EPA believes that nonroad equipment manufacturers are

generally required to use engines certified to nonroad standards

pursuant to Section 213 of the Act, EPA believes that the Act does give

EPA the flexibility to permit nonroad equipment manufacturers to use

certified on-highway engines in this instance.

To facilitate the conversion of on-highway vehicles to nonroad

vehicles having nonroad engines, we are providing that nonroad engines

may be installed in on-highway vehicles where the original vehicle

manufacturer obtains a written statement from a secondary manufacturer

that such vehicles will be converted to nonroad vehicles before title

is transferred to an ultimate purchaser. We are also providing that on-

highway engines may be used in nonroad vehicles in the event that a

state requires their use under a waiver granted by EPA pursuant to

section 209(e) of the Clean Air Act.

VI. Use of Uncertified Engines for Replacement of Failed Engines in

Older Equipment

A. Discussion

As indicated above, the Large CI rule prohibits the introduction

into commerce of any new nonroad engines subject to these regulations

unless the engines are certified by EPA. According to a letter received

from the Engine Manufacturers Association, this prohibition poses a

hardship to engine manufacturers and their customers when equipment

produced before the applicable effective date of the Large CI rule, and

therefore equipped with uncertified engines, experiences catastrophic

engine failures.2 In such cases, particularly for newer pieces of

equipment still under warranty, engine manufacturers desire to be able

to provide an entire new engine. However, certified engines that will

fit are often not available for reasons discussed below.

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\2\ Letter from EMA to Mr. Chester J. France of EPA dated

February 13, 1996. Available in the docket.

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Under current regulations, an equipment owner who experiences a

major engine failure with an uncertified engine is limited to the

following options. It can:

(1) Obtain a new, uncertified engine from a manufacturer's or

distributor's inventory. Regulations at 40 CFR 89.1003(b)(4) provide

that:

Nonroad vehicle and engine manufacturers may continue to use

noncertified nonroad engines built prior to the effective date until

noncertified engine inventories are depleted; however, stockpiling

of noncertified nonroad engines will be considered a violation of

this section.

EPA does not regard engines inventoried beyond the end of a model

year for reasonable anticipated warranty needs to be ``stockpiled''.

However, because of the manufacturers' understandable desire to avoid

inventory costs, this option would not likely be able to supply

significant numbers of replacement engines. Manufacturers have

indicated to EPA that their supplies of pre-regulation engines to which

the January 1, 1996 phase-in date is applicable, are virtually all

gone.

(2) Obtain a used or remanufactured engine.

There are numerous entities engaged in remanufacturing nonroad

engines in the U.S. The larger remanufacturers have distributors

located around the country and have told EPA that they can sometimes

provide next day service of certain of the more common nonroad engines.

EPA has no restrictions on the installation of used or remanufactured

engines in equipment that predates the relevant effective date of the

Large CI rule.

(3) Repair the individual engine using a ``short block.''

In this case, a new cylinder block with pistons, connecting rods,

crankshaft and timing gear (a ``short block'') serves as a repair part.

EPA has a long standing policy, well known to industry, that a short

block is not a new engine and will not result in a new engine when

combined with the used components from the original engine.3

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\3\ Letters of December 11, 1989 and April 6, 1990 from Charles

N. Freed, EPA to Mitsubishi Motors America, Inc. Copies located in

docket.

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(4) Replace with a new, certified engine.

In this case, a new certified engine is installed in place of the

uncertified engine. This is the most desirable option from the Agency's

point of view, however in many cases certified engines will not fit in

equipment that may have been designed around uncertified engines. Many

engines certified to meet the nonroad standards are equipped with

additional or different components which impact the external dimensions

of or connections to the engines and therefore limit their abilities to

fit in engine compartments of older equipment.

From the manufacturers' point of view, all of the current options

described above have limitations. The manufacturers point to a long

standing industry practice of being able to provide complete, new

replacement engines expeditiously when catastrophic engine failures

occur, particularly when those failures affect equipment in the first

few years of use and even more particularly when it may still be under

warranty. Many of these engines are used in highly specialized

agricultural or construction equipment. Timely repairs can be crucial

when the broken engine is in an agricultural combine and crops are

waiting to be harvested. Because of the diversity of nonroad products

using large CI engines, replacement or rental nonroad equipment is

generally not as readily available as it is with on-highway equipment.

As manufacturers have exhausted their supply of preregulation

engines they have begun to furnish short blocks for engine repairs.

They have indicated to EPA that the need to repair an engine using a

short block leads to delays and extra costs that would not occur if the

old, broken engine could simply be exchanged for a new uncertified

engine. They argue that the short block option

[[Page 58105]]

requires greater skills and facilities and more time to complete than

an engine swap and produces an engine that is not a factory-tested and

adjusted unit. From an air quality standpoint, they argue that an

entire new uncertified engine might be better than an old engine

repaired with a new short block or replaced with a remanufactured

engine.

Manufacturers have indicated that the number of nonroad engines

that would be subject to replacement each year is far less than one

percent of annual production. Manufacturers are often still producing

uncertified complete engines for export, are willing to produce small

quantities for replacement purposes, and desire to be able to sell them

(or provide them under warranty) for replacement purposes. We note that

the California Air Resources Board, in its regulation of large nonroad

diesel engines permits the introduction into commerce of uncertified

engines for replacement purposes up through January 1, 2000.

To address industry's concerns and minimize disruption to equipment

operators accustomed to replacement engines, the Agency is amending the

regulations to permit the sale of uncertified replacement engines in

those cases where a new, certified engine is not available with

appropriate physical or performance characteristics to repower the

vehicle. The Agency believes that if a certified engine is available

with sufficient torque and horsepower that will fit in the vehicle,

then the certified engine should be used.

The amended regulations will permit a nonroad engine in a piece of

equipment that predates the applicable implementation date of the Large

CI rule to be replaced with a new, uncertified engine.

Given the small percentage of uncertified engines that will likely

require replacement, the fact that some of those will get replaced with

certified engines and the issue that a new replacement engine is likely

to be at least as clean as a remanufactured engine or an engine

repaired with a short block as currently allowed, we do not believe

that permitting the use of uncertified replacement engines will pose an

environmental threat or reduce the environmental benefit of the Large

CI rule.

B. Regulatory Approach

As with the use of on-highway engines in nonroad vehicles, the

Agency is implementing this provision through amendments to the

Prohibited Acts section at 40 CFR 89.1003. As suggested by the Engine

Manufacturers Association, EPA is requiring that any uncertified large

C.I. engine produced for replacement purposes be clearly labeled as

such and that such label include a warning that any use of the engine

in a motor vehicle or post-regulation nonroad vehicle constitutes a

violation of the Act subject to civil penalty. As further suggested by

EMA, EPA is requiring that the manufacturer retain documentation that

it took a failed engine from the customer in exchange for each

uncertified replacement engine that was sold.

VII. Final Action

EPA is publishing this rule without prior proposal because EPA

views these amendments as noncontroversial and anticipates no adverse

comments. However, in the event that adverse or critical comments are

filed, EPA has prepared a Notice of Proposed Rulemaking (NPRM)

proposing the same amendments. This NPRM is contained in a separate

document in this Federal Register publication. The direct final action

will be effective January 13, 1997 unless adverse or critical comments

are received by December 12, 1996. If EPA receives adverse or critical

comments on either the revisions discussed in Section V or those

discussed in Section VI, the revisions described in that section will

be withdrawn. If adverse or critical comments are received on the

revisions described in both sections, then both sections will be

withdrawn before the effective date. In case of the withdrawal of all

or part of this action, the withdrawal will be announced by a

subsequent Federal Register document. All public comments will then be

addressed in a subsequent final rule based on this action serving as a

proposed rule. EPA will not implement a second comment period on this

action. Any parties interested in commenting on this rule should do so

at this time. If no adverse comments are received, the public is

advised that the rule will be effective January 13, 1997.

VIII. Cost Effectiveness

This rulemaking alters an existing provision by allowing nonroad

vehicle manufacturers to have greater flexibility in their choice of

engines under certain circumstances. It also permits nonroad engine

manufacturers to sell engines that the original rule would not permit.

Therefore, because this rulemaking alters an existing provision, and

that alteration provides regulatory relief, there are no additional

costs to original equipment manufacturers associated with this specific

final action.

The costs and emission reductions associated with the Large CI rule

were developed for the June 17, 1994 final rulemaking. We do not

believe the change being implemented today affects the costs and

emission reductions published as part of that rulemaking.

IX. Administrative Requirements

A. Administrative Designation

Under Executive Order 12866 (58 FR 51735, October 4, 1993), the

Agency must determine whether the regulatory action is ``significant''

and therefore subject to OMB review and the requirements of the

Executive Order. The Order defines ``significant regulatory action'' as

one that is likely to result in a rule that may:

(1) Have an annual effect on the economy of $100 million or more or

adversely affect in a material way the economy, a sector of the

economy, productivity, competition, jobs, the environment, public

health or safety, or State, local, or tribal governments or

communities;

(2) Create a serious inconsistency or otherwise interfere with an

action taken or planned by another agency;

(3) Materially alter the budgetary impact of entitlements, grants,

user fees, or loan programs or the rights and obligations of recipients

thereof; or,

(4) Raise novel legal or policy issues arising out of legal

mandates, the President's priorities, or the principles set forth in

the Executive Order.

It has been determined that this rule is not a ``significant

regulatory action'' under the terms of Executive Order 12866 and is

therefore not subject to OMB review.

B. Reporting and Recordkeeping Requirements

This proposed rulemaking does not change the information collection

requirements submitted to and approved by OMB in association with the

Large CI final rulemaking (59 FR 31306, June 17, 1994).

C. Impact on Small Entities

EPA has determined that it is not necessary to prepare a regulatory

flexibility analysis in connection with this final rule. This rule will

not have a significant adverse economic impact on a substantial number

of small businesses. This rulemaking will provide regulatory relief to

both large and small volume engine and equipment manufacturers by

permitting greater flexibility in engine choices in vehicles. It will

not have a substantial impact on such entities. The provisions in this

rulemaking will not have a significant impact on businesses that

manufacture, rebuild, distribute, or sell

[[Page 58106]]

automotive parts, nor those involved in automotive service and repair,

as the revisions simply permit a long-standing business practice to

continue.

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 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 the rule in today's

Federal Register. This rule is not a ``major rule'' as defined by 5

U.S.C. 804(2).

E. 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, or $100 million or more. Under Section 205, EPA

must select the most cost effective and least burdensome alternative

that achieves the objectives of the rule and is consistent with

statutory requirements. Section 203 requires EPA to establish a plan

for informing and advising any small governments that may be

significantly or uniquely impacted by the rule.

EPA has determined that the action proposed today does not include

a Federal mandate that may result in estimated costs of $100 million or

more to either State, local, or tribal governments in the aggregate, or

to the private sector.

List of Subjects

40 CFR Part 86

Environmental protection, Administrative practice and procedure,

Confidential business information, Labeling, Motor vehicle pollution,

Reporting and recordkeeping requirements.

40 CFR Part 89

Environmental protection, Administrative practice and procedure,

Confidential business information, Imports, Labeling, Motor vehicle

pollution, Reporting and recordkeeping requirements, Research,

Warranties.

Dated: October 28, 1996.

Carol M. Browner,

Administrator.

For the reasons set out in the preamble, title 40, chapter I, of

the Code of Federal Regulations, is amended as set forth below.

PART 86--CONTROL OF AIR POLLUTION FROM NEW AND IN-USE MOTOR

VEHICLES AND NEW AND IN-USE MOTOR VEHICLE ENGINES: CERTIFICATION

AND TEST PROCEDURES

1. The authority citation for part 86 continues to read as follows:

Authority: Secs. 202, 203, 205, 206, 207, 208, 215, 216, 217,

and 301(a), Clean Air Act, as amended (42 U.S.C. 7521, 7522, 7524,

7525, 7541, 7542, 7549, 7550, 7552, and 7601(a)).

2. Section 86.090-5 is amended by adding paragraph (a)(3) to read

as follows:

Sec. 86.090-5 General standards; increase in emissions; unsafe

conditions.

(a) * * *

(3) Notwithstanding paragraphs (a) (1) and (2) of this section, a

light or heavy duty motor vehicle equipped with an engine certified to

the nonroad provision of 40 CFR part 89 may be sold, offered for sale

or otherwise introduced into commerce by a motor vehicle manufacturer

to a secondary manufacturer if the motor vehicle manufacturer obtains

written assurance from the secondary manufacturer that such vehicle

will be converted to a nonroad vehicle or to a piece of nonroad

equipment, as defined in 40 CFR part 89, before title is transferred to

an ultimate purchaser. Failure of the secondary manufacturer to convert

such vehicles to nonroad vehicles or equipment prior to transfer to an

ultimate purchaser shall be considered a violation of section 203(a)

(1) and (3) of the Clean Air Act.

* * * * *

PART 89--CONTROL OF EMISSIONS FROM NEW AND IN-USE NONROAD ENGINES

1. The authority citation for part 89 continues to read as follows:

Authority: Sections 202, 203, 204, 205, 206, 207, 208, 209, 213,

215, 216, and 301(a) of the Clean Air Act, as amended (42 U.S.C.

7521, 7522, 7523, 7524, 7525, 7541, 7542, 7543, 7547, 7549, 7550,

and 7601(a).

2. Section 89.1003 is amended by revising paragraphs (a)(6) and

(b)(4) and adding paragraphs (b)(5), (b)(6), and (b)(7) to read as

follows:

Sec. 89.1003 Prohibited acts.

(a) * * *

(6) For a manufacturer of nonroad vehicles or equipment to

distribute in commerce, sell, offer for sale, or introduce into

commerce a nonroad vehicle or piece of equipment, manufactured on or

after the implementation date applicable to engines in such vehicle or

equipment under Sec. 89.102-96(a), which contains an engine not covered

by a certificate of conformity.

(b) * * *

(4) Certified nonroad engines shall be used in all vehicles and

equipment manufactured on or after the applicable dates in Sec. 89.102-

96(a) that are self-propelled, portable, transportable, or are intended

to be propelled while performing their function unless the manufacturer

of the vehicle or equipment can prove that the vehicle or equipment

will be used in a manner consistent with paragraph (2) of the

definition of nonroad engine in Sec. 89.2. Nonroad vehicle and

equipment manufacturers may continue to use noncertified nonroad

engines built prior to the effective date until noncertified engine

inventories are depleted; however, stockpiling of noncertified nonroad

engines will be considered a violation of this section.

(5) A manufacturer of nonroad vehicles may install an engine

certified to the motor vehicle requirements of 40 CFR part 86 in a

nonroad vehicle or equipment where:

(i) The subject nonroad vehicle or equipment is designed for travel

on public streets and highways to get from one job site to another; and

(ii) The engine serves to propel the vehicle or equipment when it

is operated on public roads; and

(iii) There is no adjustment outside of the manufacturer's

specifications or removal or rendering inoperative of devices or

elements of design installed on or in the engine by the original engine

manufacturer for purposes of emission control or any other action that

may be considered tampering under section 203 of the Clean Air Act or

paragraph (a)(3) of this section; and

(iv) A certified nonroad engine is not available with appropriate

physical or performance characteristics; or

(v) A state requires the use of an on-highway engine pursuant to a

waiver granted by EPA under section 209(e) of the Clean Air Act.

(6) A manufacturer that produces nonroad vehicles or equipment by

performing modifications to complete or incomplete motor vehicles may

retain the motor vehicle engine in such vehicle or equipment provided

that:

[[Page 58107]]

(i) The engine is certified to the motor vehicle requirements of 40

CFR part 86; and

(ii) The on-highway vehicle is not available from its manufacturer

with a certified nonroad engine having appropriate performance

characteristics; and

(iii) There is no adjustment outside of the manufacturer's

specifications or removal or rendering inoperative of devices or

elements of design installed on or in the engine or vehicle by the

original engine or vehicle manufacturer for purposes of emission

control, or any other action that may be considered tampering under

section 203 of the Clean Air Act or paragraph (a)(3) of this section.

(7) A new nonroad engine, intended solely to replace an engine in a

piece of nonroad equipment manufactured prior to the applicable

implementation date in Sec. 89.102-96(a), shall not be subject to the

prohibitions of paragraph (a)(1) of this section or the requirements of

Sec. 89.105-96 and paragraph (b)(4) of this section provided that:

(i) The engine manufacturer has ascertained that no engine produced

by itself or the manufacturer of the engine that is being replaced, if

different, and certified to the requirements of this subpart, is

available with the appropriate physical or performance characteristics

to repower the equipment; and

(ii) The engine manufacturer or its agent takes ownership and

possession of the old engine in partial exchange for the replacement

engine; and

(iii) The replacement engine is clearly labeled with the following

language, or similar alternate language approved by the Administrator:

THIS ENGINE DOES NOT COMPLY WITH FEDERAL NONROAD OR ON-HIGHWAY EMISSION

REQUIREMENTS. SALE OR INSTALLATION OF THIS ENGINE FOR ANY PURPOSE OTHER

THAN AS A REPLACEMENT ENGINE IN A NONROAD VEHICLE OR PIECE OF NONROAD

EQUIPMENT BUILT BEFORE JANUARY 1, [INSERT APPROPRIATE YEAR] IS A

VIOLATION OF FEDERAL LAW SUBJECT TO CIVIL PENALTY.

[FR Doc. 96-28545 Filed 11-8-96; 8:45 am]

BILLING CODE: 6560-50-P