Control of Air Pollution From New Motor Vehicles and New Motor Vehicle Engines; Nonconformance Penalties for 1996 Model Year Emission Standards for Heavy-Duty Vehicles

ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 86

[A-94-13; FRL-5425-8]

RIN 2060-AE07

Control of Air Pollution From New Motor Vehicles and New Motor

Vehicle Engines; Nonconformance Penalties for 1996 Model Year Emission

Standards for Heavy-Duty Vehicles

AGENCY: Environmental Protection Agency (EPA).

ACTION: Final rule.

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SUMMARY: This final rule announces the availability of nonconformance

penalties (NCPs) for the Light-Duty Truck 3 (LDT3) particulate matter

(PM) standard taking effect in the 1996 model year. The availability of

these NCPs will allow manufacturers of LDT3 whose vehicles or engines

fail to conform with the 1996 PM standard, but do not exceed a

designated upper limit, to be issued a certificate of conformity upon

payment of a monetary penalty. The associated upper limit for the LDT3

PM standard will be the previous standard of 0.13 grams per mile (g/

mi).

A concurrent, but separate rulemaking addresses the availability of

NCPs for the 1998 and later model year oxides of nitrogen (NOX)

standard for Heavy-Duty Diesel Engines (HDDEs), the 1996 and later

model year NOX standard for LDT3 and the 1996 urban bus PM

standard.

EFFECTIVE DATE: This rule will become effective March 25, 1996.

ADDRESSES: Public Docket: Copies of materials relevant to this

rulemaking proceeding are contained in Public Docket A-94-13 at the Air

Docket of the US Environmental Protection Agency, Room M1500, 401 M

Street, SW, Washington, DC 20460, and are available for review in Room

M1500 between the hours of 8:00 a.m. and 5:30 p.m. on weekdays. As

provided in 40 CFR Part 2, a reasonable fee may be charged for copying

services.

FOR FURTHER INFORMATION CONTACT: Mr. Gregory Orehowsky, Manufacturers

Operations Division (6405-J), US Environmental Protection Agency, 401 M

Street, SW, Washington, DC 20460, telephone (202) 233-9292.

SUPPLEMENTARY INFORMATION:

I. Statutory Authority

Section 206(g) of the Clean Air Act (the Act), 42 U.S.C. 7525(g),

requires EPA to issue a certificate of conformity for HDEs or Heavy-

Duty Vehicles (HDVs) which exceed an applicable section 202(a)

emissions standard, but do not exceed an upper limit associated with

that standard, if the manufacturer pays an NCP established by

rulemaking. Congress adopted section 206(g) in the Clean Air Act

Amendments of 1977 as a response to perceived problems with technology-

forcing heavy-duty emissions standards. (It should be noted, however,

that the existence of NCPs does not change the criteria under which the

standards have been and will be set under section 202.) Following

International Harvester v. Ruckelshaus, 478 F.2d 615 (D.C. Cir. 1973),

Congress realized the dilemma that technology-forcing standards were

likely to cause. If strict standards were maintained, then some

manufacturers, ``technological laggards,'' might be unable to comply

initially and would be forced out of the marketplace. NCPs were

intended to remedy this potential problem. The laggards would have a

temporary alternative that would permit them to sell their engines or

vehicles by payment of a penalty. This penalty is based in part, on the

money saved from

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the production of noncomplying engines, would protect conforming

manufacturers from the competitive disadvantage of making more costly

engines which comply with technology forcing standards.

Under section 206(g)(1) of the Clean Air Act, NCPs may be offered

for HDVs or HDEs. The penalty may vary by pollutant and by class or

category of vehicle or engine.

HDVs are defined by section 202(b)(3)(C) of the Clean Air Act as

vehicles in excess of 6,000 pounds gross vehicle weight rating (GVWR).

The light-duty truck (LDT) classification includes trucks that have a

GVWR of 8,500 lbs or less. Therefore, certain LDTs may be classified as

HDVs. Historically, LDTs between 6,001 and 8,500 pounds GVWR have been

considered Heavy Light Duty Trucks (HLDTs). Based on various new

requirements established by the Clean Air Act Amendments of 1990, HLDTs

have been further subdivided into groups by weight.

The HLDTs are divided at 5750 lbs Adjusted Loaded Vehicle Weight

(ALVW) which is the average of the curb weight and the GVWR. The HLDTs

that are up through 5750 lbs ALVW are called Light Duty Trucks 3

(LDT3). Those above 5750 lbs ALVW but less than or equal to 8500 lbs

GVWR are Light Duty Trucks 4, or LDT4. The LDT3 and LDT4 subclasses

make up the HLDT vehicle class. Since NCPs are only offered for heavy

duty vehicles or engines, this notice addresses only emission standards

for light duty trucks of the LDT3 and LDT4 categories.

Section 206(g)(3) of the Clean Air Act requires that NCPs:

(1) Account for the degree of emission nonconformity;

(2) Increase periodically to provide incentive for nonconforming

manufacturers to achieve the emission standards; and

(3) Remove the competitive disadvantage to conforming

manufacturers.

Section 206(g) authorizes EPA to require testing of production

vehicles or engines in order to determine the emission level on which

the penalty is based. If the emission level of a vehicle or engine

exceeds an upper limit of nonconformity established by EPA through

regulation, the vehicle or engine would not qualify for an NCP under

section 206(g) and no certificate of conformity could be issued to the

manufacturer. If the emission level is below the upper limit but above

the standard, that emission level becomes the ``compliance level,''

which is also the benchmark for warranty and recall liability; the

manufacturer who elects to pay the NCP is liable for vehicles or

engines that exceed the compliance level in-use, unless, for the case

of HLDTs, the compliance level is below the in-use standard. The

manufacturer does not have in-use warranty or recall liability for

emissions levels above the standard but below the compliance level.

II. Background

A. The Generic Nonconformance Penalty Rule

The generic NCP rule (Phase I) established three basic criteria for

determining the eligibility of emission standards for nonconformance

penalties in any given model year. See 40 CFR 86.1103-87. First, the

emission standard in question must become more difficult to meet. This

can occur in two ways, either by the emission standard itself becoming

more stringent, or due to its interaction with another emission

standard that has become more stringent.

Second, substantial work must be required to meet the emission

standard. EPA considers ``substantial work'' to mean the application of

technology not previously used in that vehicle or engine class/

subclass, or a significant modification of existing technology, to

bring that vehicle/engine into compliance. EPA does not consider minor

modifications or calibration changes to be classified as substantial

work.

Third, a technological laggard must be likely to develop. A

technological laggard is defined as a manufacturer who cannot meet a

particular emission standard due to technological (not economic)

difficulties and who, in the absence of NCPs, might be forced from the

marketplace. EPA will make the determination that a technological

laggard is likely to develop, based in large part on the above two

criteria. However, these criteria are not always sufficient to

determine the likelihood of the development of a technological laggard.

An emission standard may become more difficult to meet and substantial

work may be required for compliance, but if that work merely involves

transfer of well-developed technology from another vehicle class, it is

unlikely that a technological laggard would develop.

The above three criteria were used to determine eligibility for

NCPs in Phase II of the NCP rulemaking (50 FR 53454, December 31,

1985), in Phase III of the NCP rulemaking (55 FR 46622, November 5,

1990) concerning the 1991 model year HDE standards, and in Phase IV of

the NCP rulemaking (58 FR 68532, December 28, 1993) concerning HDVs and

HDEs subject to the 1994 and later model year emission standards for

particulate matter (PM).

As in the previous NCP rules, EPA is specifying values for the

following parameters in the NCP formula for each standard: COC50,

COC90, MC50, and F. The NCP formula is the same as that

promulgated in the Phase I rule.

COC50 is an estimate of the industry wide average incremental

cost per engine (references to engines are intended to include vehicles

as well) associated with meeting the standard for which an NCP is

offered, compared with meeting the upper limit. COC50 is based on

typical engine technology, as nearly as EPA can identify it. As in the

previous NCP rules, costs include additional manufacturer costs and

additional owner costs. The other NCP rules did not include

certification costs in the calculation of COC50, and none will be

allowed in this document because both complying and noncomplying

manufacturers must incur certification costs.

COC90 is EPA's best estimate of the 90th percentile

incremental cost per engine associated with meeting the standard for

which an NCP is offered, compared with meeting the associated upper

limit. COC90 is based on a near worst case technology, as nearly

as EPA can identify it. COC90, like COC50, includes both

manufacturer and owner costs, but not certification costs.

MC50 is an estimate of the industry wide average marginal cost

of compliance per unit of reduced pollutant associated with the least

cost effective emission control technology installed to meet the new

standard. MC50 is measured in dollars per g/BHP-hr for HDEs and in

dollars per gram per mile (g/mi) for LDTs.

F is a factor used to derive MC90, the 90th percentile

marginal cost of compliance with the NCP standard for engines in the

NCP category. MC90 is defined as being the slope of the penalty

rate curve near the standard and is equal to MC50 multiplied by F.

For this rulemaking, as was the case in the previous NCP rules, EPA has

determined that no reasonable estimate of MC90 can be made based

on existing marginal cost data and has thus set F at a presumptive

value of 1.2. This approach was generally supported by commentaries on

the past NCP rulemakings.

B. Notice of Proposed Rulemaking

In the Notice of Proposed Rulemaking (NPRM) (59 FR 43074, August

22, 1994), EPA identified the Tier I Heavy Light

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Duty Trucks (HLDT) standards becoming effective in 1996, the 1996 Urban

Bus PM standard of 0.05 g/bhp-hr, and the 1998 Heavy Duty Engine (HDE)

NOX standard of 4.0 g/bhp-hr as new standards for which it has

statutory authority for considering NCPs. EPA then applied the three

generic NCP criteria to each of those emission standards.

The Agency identified the 1996 LDT3 PM standard of 0.10 g/mi as

satisfying the required NCP criteria and, therefore, proposed to make

NCPs available for that standard. The Agency also proposed upper limits

for that standard and numerical values to be used in the calculation of

the NCP for the associated vehicles.

EPA did not propose NCPs for the other new standards because they

did not meet all three of the generic NCP criteria.

NCPs were not considered for the Tier 1 ``in-use'' standards since

NCPs are a mechanism to allow manufacturers to certify engine families,

not to assist manufacturers in complying with ``in-use'' standards.

C. Final Rule--Availability of NCPs

1. Standard for Which NCPs Will Be Offered

a. 1996 Tier 1 PM Standard for Diesel LDT3

EPA recognizes that the new PM standard of 0.10 g/mi at full useful

life represents an increase in stringency over the prior standard of

0.13 g/mi at full useful life for diesel-fueled LDT3, satisfying the

first eligibility criterion. Based on discussions with General Motors,

the only current manufacturer of diesel-fueled vehicles in this class,

EPA believes that the addition of catalytic converter technology to

these engines will probably not bring them into compliance with the new

standard. Significant work will be required for another technology,

such as a Variable Geometry Turbocharger, to be adapted for use on

these vehicles. This is especially true when considering the

interrelationship of the NOX and PM emissions of diesel-fueled

engines, as stated above. For these reasons, EPA believes that a

technological laggard may develop and is offering NCPs for diesel-

fueled LDT3 at the full useful life for the new PM standard. The

proposed penalty rates are discussed below.

2. Standards for Which NCPs Were Not Proposed

a. 1996 Tier 1 PM Standard for Non-Diesel Fueled LDT3

There is no previous PM standard for non-diesel fueled LDT3. Thus

the new PM standard of 0.10 g/mi at full useful life represents an

increase in stringency. However, non-diesel fueled vehicles emit very

low levels of particulate matter and will not require any additional

emission control technology to meet this standard. Thus, substantial

work is not required and there is not a likelihood that a technological

laggard will develop. Therefore, EPA did not propose NCPs for these

vehicles.

b. 1996 Tier 1 Non-Methane Hydrocarbon (NMHC) Standard for LDT3

Since there is no NMHC standard for earlier model year LDT3, the

new NMHC standard represents an increase in stringency over the THC

standard for previous model years, satisfying the first eligibility

criterion. EPA acknowledges that one manufacturer has indicated that it

may have difficulty complying with this standard. Based on the

manufacturer's planned strategy, however, EPA does not believe that

substantial work, as described above, will be necessary to meet the new

standard for either the intermediate useful-life level of 0.32 g/mi or

the full useful-life level of 0.46 g/mi, since it does not represent a

major modification of existing technology. EPA also does not believe

that a technological laggard is likely to develop, based on discussions

with vehicle manufacturers. For these reasons, EPA did not propose NCPs

for this standard.

c. 1996 Tier 1 CO Standard for LDT3

EPA recognizes that the new CO standard of 6.4 g/mi at full useful

life represents an increase in stringency over the prior standard of 10

g/mi at full useful life for LDT3, satisfying the first eligibility

criterion. Based on 1993 model year certification levels, only one

manufacturer is currently producing LDT3 vehicles which would not meet

the new standard at full useful life. Since this manufacturer does not

anticipate difficulty in meeting the new CO standards, EPA does not

believe that a technological laggard is likely to develop. The half

useful-life standard of 4.4 g/mi is considered by EPA and manufacturers

to be less difficult to meet than the full useful life standard. For

these reasons, EPA did not propose NCPs for these standards.

d. 1996 Tier 1 Non-Methane Hydrocarbon (NMHC) Standard for LDT4

There is no NMHC standard for earlier model year LDT4. Both EPA and

vehicle manufacturers believe that the NMHC standard represents an

increase in stringency over the THC standard for previous model year

LDT4, satisfying the first eligibility criterion. The same manufacturer

that expressed concern in meeting the NMHC standard for LDT3 has

similar concerns in meeting this standard and will use a similar

strategy to lower the emissions. For the same reasons stated in the

above discussion of the NMHC standard for LDT3, EPA did not propose

NCPs for the NMHC standard at either the intermediate or the full

useful life.

e. 1996 Tier 1 CO Standard for LDT4

EPA recognizes that the new CO standard of 7.3 g/mi at full useful

life represents an increase in stringency over the prior standard of 10

g/mi at full useful life for LDT4, satisfying the first eligibility

criterion. Based on discussions with current manufacturers of affected

vehicles, EPA believes that manufacturers will not have difficulty in

meeting the new standard. Since there are no 1993 model year LDT4 with

CO certification levels higher than the new standard at full useful

life, EPA does not believe that a technological laggard is likely to

develop. The half useful-life standard of 5.0 g/mi is generally

considered by EPA and manufacturers to be less difficult to meet than

the full useful life standard of 7.3 g/mi. For these reasons, EPA did

not propose NCPs for these standards.

f. 1996 Tier 1 NOX Standard for LDT4

EPA recognizes that the new NOX standard of 1.53 g/mi at full

useful life represents an increase in stringency over the prior

standard of 1.7 g/mi at full useful life for LDT4, satisfying the first

eligibility criterion. Based on discussions with current manufacturers

of affected vehicles, and based on the fact that there were no model

year 1993 LDT4 certified which would exceed the new standard at full

useful life, EPA believes that substantial work, as described above,

will not be required of manufacturers and that a technological laggard

is not likely to develop. The half useful-life standard for non-diesel

vehicles of 1.10 g/mi is generally considered by EPA and manufacturers

to be less difficult to meet than the full useful life standard. For

these reasons, EPA did not propose NCPs for the new LDT4 NOX

standards.

g. 1996 Tier 1 PM Standard for LDT4

EPA recognizes that the new PM standard of 0.12 g/mi at full useful

life represents an increase in stringency over the prior standard of

0.13 g/mi at full useful life for LDT4, satisfying the first

eligibility criterion. As in the case of non-diesel LDT3, no work

should be required to meet the new PM standard

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for non-diesel LDT4. And based on discussions with the single, current

manufacturer of diesel-fueled LDT4 vehicles and on 1993 model year

certification levels, EPA does not believe that a technological laggard

is likely to develop or that substantial work, as described above, will

be required to meet the new PM standard. For these reasons, EPA did not

propose NCPs for the new LDT4 PM standard.

3. Standards Addressed in a Concurrent NCP Rulemaking

a. 1996 Tier 1 NOX Standard for LDT3

b. 1996 Urban Bus PM Standard

c. 1998 HDDE NOX Standard

EPA's analysis of the issues concerning NCPs for these standards

and EPA's response to comments received in this rulemaking on these

standards are contained in a Direct Final Rule published elsewhere in

this Federal Register notice. The Direct Final Rule approves NCPs for

the above, three standards.

III. Summary and Analysis of Comments

Written comments were received from five entities during the

comment period: General Motors Corporation, Detroit Diesel Corporation,

Engine Manufacturers' Association, Navistar, and Mack Truck.

A. Availability of Nonconformance Penalties and Penalty Rates

Heavy Light Duty Trucks 3 PM Standard

General Motors agrees with EPA's conclusion that NCPs are justified

for the new LDT3 PM standard. GM stated that the proposed penalty rates

were not reasonable for two reasons. First, GM stated ``the basic

technology determined to be necessary to achieve the emission

improvement required by the standard includes technology (oxidizing

catalyst) that is already being used to achieve the current PM

standard. Thus, the oxidizing catalyst costs included in the penalty

rate determinations needs to be removed and the penalty rates modified

to include only the other technology believed needed to achieve the

1996 PM standard.'' EPA agreed with this suggestion since GM is the

only manufacturer in this market segment. Since GM was not able to

specify what technology would be needed to meet the standard, the

penalty rates in this Final Rule reflect EPA's best determination of

the technology believed necessary for a manufacturer already using

catalyst technology, but still unable to attain the standard.

EPA believes that vehicles unable to achieve the standard with

catalyst technology will need to rely on variable geometry turbocharger

technology, improved oil control, and additional work in optimizing

engine calibrations.

Second, GM argues that since the new Tier 1 standard effectively

increases the test weight used in testing vehicles of this class, this

fact should be accounted for in determining the penalty rates and the

upper limit for the LDT3 PM NCP. While EPA believes the said effect to

be plausible, it is likely a relatively small effect. And, in the

absence of any manufacturer-supplied data in support of that claim,

this component was not considered in determining the NCPs for this

Final Rule.

IV. Penalty Rates

This rule is the most recent in a series of NCP rulemakings. The

discussion of penalty rates in the Phase IV rulemaking (58 FR 68532,

December 28, 1993), Phase III rulemaking (55 FR 46622, November 5,

1990), the Phase II rulemaking (50 FR 53454, December 31, 1985) as well

as the Phase I rulemaking (50 FR 35374, August 30, 1985) are

incorporated by reference.

The derivation of the 1996 Tier 1 LDT3 PM standard cost parameters

are described in a support document entitled ``Calculation of

Nonconformance Penalty Rates for 1996 and Later Model Year LDT3

Particulate Matter (PM), LDT3 Oxides of Nitrogen (NOX), 1996 and

Later Model Year Urban Bus Particulate Matter (PM), and 1998 and Later

Model Year HDDE Oxides of Nitrogen (NOX) Standards,'' which is

available in the public docket for this rulemaking. The associated

upper limit of 0.13 g/mi PM, the previous PM standard, was determined

as per section 86.1104-91 of the Code of Federal Regulations.

V. Administrative Designation and Regulatory Analysis

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

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.

Pursuant to the terms of Executive Order 12866, it has been

determined that this rule is not a ``significant regulatory action.''

This regulation will not have an annual effect on the economy in excess

of $100 million and will not cause a major increase in the price of

HDEs above those that would otherwise occur from compliance with the

emission standards themselves. This regulation is intended to assist

manufacturers that are having difficulty developing and marketing

vehicles which comply with the 1996 Tier 1 PM standard for LDT3.

Without this rule, a manufacturer experiencing difficulty in complying

with this new emission standard (after the use of credits) has only two

alternatives: fix the nonconforming engines for the associated model

years or not sell them at all. NCPs provide manufacturers with

additional time to bring their engines into conformity.

In addition, NCPs are calculated to deprive nonconforming

manufacturers of any cost savings and competitive advantages stemming

from marketing a nonconforming engine. Thus, NCPs will not have

significant adverse effects on competition, employment, investment,

productivity, innovation or on the ability of United States-based

enterprises to compete with foreign-based enterprises in domestic or

export markets.

VI. Economic Impact

Because the use of NCPs is optional, manufacturers have the

flexibility and will likely choose whether or not to use NCPs based on

their ability to comply with emissions standards. If a HDE manufacturer

elects not to use NCPs, the manufacturer and its customers will not

incur any additional costs related to NCPs.

NCPs remedy the potential problem of having a manufacturer forced

out of the marketplace due to that manufacturer's inability to conform

to new, strict emission standards in a timely manner. Without NCPs, a

manufacturer which has difficulty certifying HDEs in conformance with

emission standards or whose engines fail a SEA has only two

alternatives: fix the nonconforming engines, perhaps at a prohibitive

cost, or prevent their introduction into commerce. The availability of

NCPs provides manufacturers with a third alternative: continue

production and introduce into commerce upon payment

[[Page 6948]]

of a penalty for an engine that exceeds the standard until an emission

conformance technique is developed.

Therefore, NCPs represent a regulatory mechanism that allows

affected manufacturers to have increased flexibility. A decision to use

NCPs may be a manufacturer's only way to continue to introduce HDEs

into commerce. Hence, NCPs may be considered to have no adverse

economic impact.

VII. Environmental Impact

When evaluating the environmental impact of this rule, one must

keep in mind that, under the Clean Air Act, NCPs are a consequence of

enacting new, more stringent emissions requirements for heavy duty

engines. Emission standards are set at a level that most, but not

necessarily all, manufacturers can achieve by the model year in which

the standard becomes effective. Following International Harvester v.

Ruckelshaus, 478 F.2d 615 (D.C. Cir. 1973), Congress realized the

dilemma that technology-forcing standards were likely to cause, and

allowed manufacturers of heavy-duty engines to certify nonconforming

vehicles/engines upon the payment of an NCP, under certain conditions.

This mechanism would allow a manufacturer(s) who cannot meet

technology-forcing standards immediately to continue to manufacture

these nonconforming engines while they tackle the technological

problems associated with meeting new emission standard(s). Thus, as

part of the statutory structure to force technological improvements

without driving manufacturers out of the market, NCPs provide

flexibility that fosters long-term emissions improvement through the

setting of lower emission standards at an earlier date than could

otherwise be possible. By design, NCPs encourage the technological

laggard that is using NCPs to reduce emission levels to the more

stringent standard as quickly as possible.

VIII. Compliance With Regulatory Flexibility Act

Under section 605 of the Regulatory Flexibility Act, 5 U.S.C. 601,

et seq., the Administrator is required to either perform a regulatory

flexibility analysis or certify that this regulation will not have a

significant impact on a substantial number of small business entities.

None of the affected manufacturers could be classified as small.

Moreover, as already discussed, the NCP program can be expected to

benefit manufacturers.

Some small entities do exist as manufacturers' contractors for the

testing of engines for Production Compliance Audits (PCAs). It is EPA's

practice to conduct PCA scheduling (namely, tests per day limitations)

in such a way as to consider the staff and manpower capabilities of

such contractors and avoid any problems. The result is that these

entities are not adversely affected. Thus, I certify that this rule

will not have any adverse economic impact on a substantial number of

small entities.

IX. Information Collection Requirements

This rule requires that manufacturers perform certain record

keeping and submit certain reports to EPA. The Paperwork Reduction Act

of 1980, 44 U.S.C. 3501, et seq., provides that reporting and

recordkeeping requirements be approved by OMB before they can be

enforced by EPA. The information collection requirements in this

proposed rule have been addressed in previous rulemaking and approved

by OMB (OMB control no. 2060-0132). However, any person wishing to

comment on these requirements is invited to do so. Comments on these

requirements should be submitted to Chief, Information Policy Branch,

Mail Code 2136, U.S. Environmental Protection Agency, 401 M St., S.W.,

Washington, DC 20460 and to Office of Management and Budget (OMB),

Office of Information and Regulatory Affairs, 726 Jackson Place, NW,

Washington, DC 20503, marked ``Attention: Desk Officer for EPA.''

X. Unfunded Mandates Reform Act

Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), Public

Law 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 alternative and adopt

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

that achieves the objectives of the rule. The provisions of section 205

do not apply when they are inconsistent with applicable law. Moreover,

section 205 allows EPA to adopt an alternative other than the least

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

Administrator publishes with the final rule an explanation why that

alternative was not adopted. Before EPA establishes any regulatory

requirements that may significantly or uniquely affect small

governments, including tribal governments, it must have developed under

section 203 of the UMRA a small government agency plan. The plan must

provide for notifying potentially affected small governments, enabling

official of affected small governments to have meaningful and timely

input in the development of EPA regulatory proposals with significant

Federal intergovernmental mandates, and informing, educating, and

advising small governments on compliance with the regulatory

requirements.

Today's rule contains no Federal mandates (under the regulatory

provisions of Title II of the UMRA) for State, local, or tribal

governments or the private sector. The rule imposes no enforceable

duties on any of these governmental entities or the private sector. In

addition, the UMRA excludes from the definition of ``Federal private

sector mandate'' duties that arise from participation in a voluntary

Federal program. Thus, this rule is not subject to the requirements of

sections 202 and 205 of the UMRA.

List of Subjects in 40 CFR Part 86

Environmental protection, Administrative practice and procedure,

Air pollution control, Gasoline, Motor vehicles, Labeling, Motor

vehicle pollution, Reporting and recordkeeping requirements.

Dated: February 12, 1996.

Carol M. Browner,

Administrator.

For the reasons set forth in the preamble, 40 CFR part 86, is

amended as follows:

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, 206, 207, 208, 215, 216, 217, 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 86.1105-87 of subpart L is amended by revising paragraph

(e),

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adding paragraph (g) and adding and reserving paragraph (h) to read as

follows:

Sec. 86.1105-87 Emission standards for which nonconformance penalties

are available.

* * * * *

(e) The values of COC50, COC90, and MC50 in

paragraphs (a) and (b) of this section are expressed in December 1984

dollars. The values of COC50, COC90, and MC50 in

paragraphs (c) and (d) of this section are expressed in December 1989

dollars. The values of COC50, COC90, and MC50 in

paragraph (f) of this section are expressed in December 1991 dollars.

The values of COC50, COC90, and MC50 in paragraphs (g)

and (h) of this section are expressed in December 1994 dollars. These

values shall be adjusted for inflation to dollars as of January of the

calendar year preceding the model year in which the NCP is first

available by using the change in the overall Consumer Price Index, and

rounded to the nearest whole dollar in accordance with ASTM E29-67

(reapproved 1980), Standard Recommended Practice for Indicating Which

Places of Figures are to be Considered Significant in Specified

Limiting Values. The method was approved by the director of the Federal

Register in accordance with 5 U.S.C. 552(a) and 1 CFR part 51. This

document is available from ASTM, 1916 Race Street, Philadelphia, PA

19103, and is also available for inspection as part of Docket A-91-06,

located at the Central Docket Section, EPA, 401 M Street, SW,

Washington, DC or at the office of the Federal Register, 800 North

Capitol Street, NW, suite 700, Washington, DC. This incorporation by

reference was approved by the Director of the Federal Register on

January 13, 1992. These materials are incorporated as they exist on the

date of the approval and a notice of any change in these materials will

be published in the Federal Register.

* * * * * *

(g) Effective in the 1996 model year, NCPs will be available for

the following emission standard:

(1) Light-duty truck 3 diesel-fueled vehicle at full useful life

(as defined in Sec. 86.094-2) particulate matter emission standard of

0.10 g/mi.

(i) The following values shall be used to calculate an NCP for the

standard set forth in Sec. 86.094-9(a)(1)(ii) in accordance with

Sec. 86.1113-87(a):

(A) COC50: $441.

(B) COC90: $1,471.

(C) MC50: $14,700 per gram per mile.

(D) F: 1.2.

(ii) The following factor shall be used to calculate the

engineering and development component of the NCP for the standard set

forth in Sec. 86.094-9(a)(1)(ii) in accordance with Sec. 86.1113-87(h):

0.093.

(2) [Reserved]

(h) [Reserved]

[FR Doc. 96-4040 Filed 2-22-96; 8:45 am]

BILLING CODE 6560-50-P