Clean Air Act Approval and Promulgation of Emission Reduction Credit Banking Provisions; Implementation Plan for California State Mojave Desert Air Quality Management District

ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[CA 157-0022a; FRL-5669-1]

Clean Air Act Approval and Promulgation of Emission Reduction

Credit Banking Provisions; Implementation Plan for California State

Mojave Desert Air Quality Management District

AGENCY: Environmental Protection Agency (EPA).

ACTION: Direct final rule.

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SUMMARY: EPA is taking direct final action on revisions to the

California State Implementation Plan (SIP). The revisions concern rules

from the Mojave Desert Air Quality Management District (MDAQMD or the

District). This approval action will incorporate these rules into the

federally approved SIP. The intended effect of approving these rules is

to control air pollution in accordance with the requirements of the

Clean Air Act, as amended in 1990 (CAA or the Act) with regard to new

source review (NSR) in areas of MDAQMD that are not in attainment of

the national ambient air quality standards (NAAQS). Thus, EPA is

finalizing the approval of these revisions into the California SIP

under provisions of the CAA regarding EPA action on SIP submittals,

SIPs for national primary and secondary ambient air quality standards

and plan requirements for nonattainment areas.

DATES: This action is effective on March 24, 1997 unless adverse or

critical comments are received by February 21, 1997. If the effective

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

Register.

ADDRESSES: Copies of the rules and EPA's evaluation report for the

rules are available for public inspection at EPA's Region IX office

during normal business hours. Copies of the submitted rules are

available for inspection at the following locations:

Permitting Office (A-5-1), Air Division, U.S. Environmental Protection

Agency, Region IX, 75 Hawthorne Street, San Francisco, CA 94105

Environmental Protection Agency, Air Docket (6102), 401 ``M'' Street,

SW., Washington, DC 20460

California Air Resources Board, Stationary Source Division, Rule

Evaluation Section, 2020 ``L'' Street, Sacramento, CA 95814

Mojave Desert AQMD, 15428 Civic Drive, Suite 200, Victorville, CA

92392-2383.

FOR FURTHER INFORMATION CONTACT: Steve Ringer, Permitting Office (A-5-

1), Air Division, U.S. Environmental Protection Agency, Region IX, 75

Hawthorne Street, San Francisco, CA 94105, Telephone: (415) 744-1260.

SUPPLEMENTARY INFORMATION:

Applicability

The rules being approved into the California SIP include: rule

1400, General; rule 1401, Definitions; rule 1402, Emission Reduction

Credit Registry; and rule 1404, Emission Reduction Credit Calculation.

These rules were adopted on June 28, 1995, and were submitted by the

State of California to EPA on August 10, 1995 (rules 1400, 1401, 1402,

and 1404 will hereafter be referred to as the ``submitted rules'').

This document promulgates EPA's direct-final action for the

submitted rules. These submitted rules were found to be complete on

October 4, 1995, pursuant to EPA's completeness criteria that are set

forth in 40 CFR part 51 Appendix V 1 and are being finalized for

approval into the SIP. The submitted rules establish a system by which

the District will calculate and bank reductions in emissions prior to

use as offsets for future increases in emissions.

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\1\ EPA adopted the completeness criteria on February 16, 1990

(55 FR 5830) and, pursuant to section 110(k)(1)(A) of the CAA,

revised the criteria on August 26, 1991 (56 FR 42216).

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Background

The air quality planning requirements for nonattainment areas are

set out in 40 CFR 51.165. The general requirements for the use of

emission reductions are set out in EPA's Emissions Trading Policy

Statement (ETPS), at 51 FR 43814, December 4, 1986.

Section 173 of the Clean Air Act requires that major new sources

and major modifications in nonattainment areas obtain offsetting

emission reductions as a part of the preconstruction permitting

process. The submitted rules create a system to provide for the banking

and transfer of such reductions. As detailed in 40 CFR 51.165 and EPA's

ETPS, offsets must reflect reductions in actual emissions, and they

must be enforceable, permanent, quantifiable, and surplus of other

regulatory requirements. For a description of how the submitted rules

ensure that emission reductions meet these requirements, please refer

to EPA's Technical Support Document (TSD) for this action.

EPA Evaluation and Action

EPA has evaluated the submitted rules and has determined that they

are consistent with the CAA, EPA regulations, and EPA policy.

Therefore, MDAQMD rules 1400, 1401, 1402, and 1404 are being approved

under section 110(k)(3) of the CAA as meeting the requirements of

section 110(a) and part D.

Nothing in this action should be construed as permitting or

allowing or establishing a precedent for any future implementation

plan. Each request for revision to the State implementation plan shall

be considered separately in light of specific technical, economic, and

environmental factors and in relation to relevant statutory and

regulatory requirements.

EPA is publishing this document without prior proposal because the

Agency views this as a noncontroversial amendment and anticipates no

adverse comments. However, in a separate document in this Federal

Register publication, the EPA is proposing to approve the SIP revision

should adverse or critical comments be filed. This action will be

effective March 24, 1997, unless, by February 21, 1997, adverse or

critical comments are received.

If the EPA receives such comments, this action will be withdrawn

before the effective date by publishing a subsequent document that will

withdraw the final action. All public comments received will then be

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

proposed rule. The EPA will not institute a second comment period on

this action. Any parties interested in commenting on this action should

do so at this time. If no such comments are received, the public is

advised that this action will be effective March 24, 1997.

Regulatory Process

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

must prepare a regulatory flexibility analysis assessing the impact of

any proposed or final rule on small entities. 5 U.S.C. 603 and 604.

Alternatively, EPA 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 a population of less than

50,000.

SIP approvals under sections 110 and 301(a) and subchapter I, Part

D of the CAA do not create any new requirements, but simply approve

requirements that the State is already imposing. Therefore, because the

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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 CAA, preparation of a regulatory flexibility analysis would

constitute Federal inquiry into the economic reasonableness of State

action. The CAA forbids EPA to base its actions concerning SIPs on such

grounds. Union Electric Co. v. U.S. E.P.A., 427 U.S. 246, 256-66 (S.

Ct. 1976); 42 U.S.C. 7410 (a)(2).

Unfunded Mandates

Under Sections 202, 203, and 205 of the Unfunded Mandates Reform

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

1995, EPA must undertake various actions in association with proposed

or final rules that include a Federal mandate that may result in

estimated costs of $100 million or more to the private sector or to

State, local, or tribal governments in the aggregate.

Through submission of this State implementation plan or plan

revision, the State and any affected local or tribal governments have

elected to adopt the program provided for under Part D of the Clean Air

Act. These rules may bind State, local, and tribal governments to

perform certain actions and also require the private sector to perform

certain duties. The rules being approved by this action will impose no

new requirements because affected sources are already subject to these

regulations under State law. Therefore, no additional costs to State,

local, or tribal governments or to the private sector result from this

action. EPA has also determined that this final action does not include

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

State, local, or tribal governments in the aggregate or to the private

sector.

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).

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 Nichols, Assistant Administrator for

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

exempted this regulatory action from Executive Order 12866 review.

List of Subjects in 40 CFR Part 52

Environmental protection, Air pollution control, Hydrocarbons,

Incorporation by reference, Intergovernmental relations, Ozone,

Reporting and recordkeeping requirements, Volatile organic compounds.

Note: Incorporation by reference of the State Implementation

Plan for the State of California was approved by the Director of the

Federal Register on July 1, 1982.

Dated: December 8, 1996.

Felicia Marcus,

Regional Administrator.

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 F--California

2. Section 52.220 is amended by adding paragraph (c)(224)(i)(C) to

read as follows:

Sec. 52.220 Identification of plan.

* * * * *

(c) * * *

(224) * * *

(i) * * *

(C) Mojave Desert Air Quality Management District.

(1) Rules 1400, 1401, 1402, 1404. Adopted on June 28, 1995.

* * * * *

[FR Doc. 97-1421 Filed 1-21-97; 8:45 am]

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