Approval and Promulgation of Implementation Plans; California Ozone

Federal RegisterJan 8, 1997

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SUMMARY: EPA is approving revisions to the California State

Implementation Plan (SIP) for ozone for 6 nonattainment areas: South

Coast, Southeast Desert, Ventura, Sacramento, San Diego, and San

Joaquin Valley. In addition, EPA is approving specific local and

statewide air pollution control measures, including the California

enhanced motor vehicle inspection and maintenance program. The

California Air Resources Board (CARB) submitted these SIP revisions to

EPA on November 14, 1994, November 15, 1994, December 28, 1994,

December 29, 1994, February 7, 1995, March 30, 1995, January 22, 1996,

April 4, 1996, May 17, 1996, June 13, 1996, July 10, 1996, and July 12,

1996.

EPA is approving these revisions to the California SIP under

provisions of the Clean Air Act (CAA) regarding EPA action on SIP

submittals for nonattainment areas.

EPA is also establishing a consultative process on the potential

for additional mobile source controls that can contribute to attainment

in the South Coast, and the Agency is committing to undertake

rulemaking on those controls deemed to be appropriate for EPA.

EFFECTIVE DATE: This approval is effective on February 7, 1997.

ADDRESSES: Materials relevant to this rulemaking are contained in

Docket No. A-96-13, which is available for viewing during normal

business hours at the following location: Air Division, Environmental

Protection Agency, Region 9, 75 Hawthorne Street, San Francisco, CA

94105-3901.

Copies of the SIP materials are also available for inspection at

the addresses listed below:

Environmental Protection Agency, Air Docket (6102), 401 M Street, S.W.,

Washington, DC

California Air Resources Board, 2020 L Street, Sacramento, California

In addition, copies of the relevant local plan, the State plan

(1994 California Ozone SIP), public comments, and EPA's technical

support documents for this rulemaking are available at the following

locations:

San Diego Air Pollution Control District, 9150 Chesapeake Drive, San

Diego, California

San Joaquin Valley Unified Air Pollution Control District, 1999

Tuolumne Street, Fresno, California

Ventura County Air Pollution Control District, 669 County Square Drive,

Ventura, California

Mojave Desert Air Quality Management District, 15428 Civic Drive, Suite

200, Victorville, California

South Coast Air Quality Management District, 21865 E. Copley Drive,

Diamond Bar, California

Electronic Availability

This document and related materials are available at Region 9's

site on the World Wide Web at http://www.epa.gov/region09 (please look

under Air Programs). The Federal Register is also available on the

Internet by pointing a web browser at: http://www.access.gpo.gov/

su__docs/ or by telnet to swais.access.gpo.gov.

FOR FURTHER INFORMATION CONTACT: Julia Barrow, Chief, Office of

Planning, Air Division, Environmental Protection Agency, Region 9, 75

Hawthorne Street, San Francisco, CA 94105-3901; (415) 744-1230.

SUPPLEMENTARY INFORMATION:

Table of Contents

I. Background

A Summary

B. General SIP Issues

1. ``Federal Assignments''

a. Importance of Federal Contribution and Difficulty of Further

Local Controls

b. Public Consultative Process

c. Legal and Policy Issues

d. Comments Specific to Source Categories

(1) Military Exemption

(2) Locomotives

(3) Ships and Shipping Channel

e. EPA Action

2. EPA Approval of Attainment Demonstrations that Rely, in Part,

on Commitments

3. Additional CAA Issues

a. Attainment as Expeditiously as Practicable

b. Contingency Measures

c. Adequacy of SIP's Technical Foundations

(1) Modeling and Treatment of Transport

(2) Impact of Changes to the ZEV Program

(3) Control Measures

d. Consistency of Local Nonroad Measures with CAA Preemption

4. Future SIP Updates and Improvements

5. Overall Approvability of Plans

6. Importance of SIP Implementation

C. SIP Submittals

1. SIP Submittals and Previous EPA Approvals

2. SIP Submittals after EPA's Proposal

3. EPA Completeness Findings

4. Rationale for EPA Approval of Minor SIP Changes without

Further Opportunity for Public Comment

II. Review of the State Submittal and Response to Comments on

Specific SIP Issues

A. State Measures

1. General Comments

2. Mobile Source Measures

a. Review of Measures

(1) M1

(2) M2

(3) M3

(4) M4

(5) M5

(6) M7

(7) M8

(8) M9

(9) M11

(10) Additional New Control Technologies

b. EPA Action

3. I/M

a. Review of Program

b. Response to Comments

c. Emission Reductions

d. EPA Action

4. Consumer Products

a. Introduction

b. Review of Measures

(1) Measure CP-1

(2) Measure CP-3 (Aerosol Paints)

(3) Mid-Term Committal Measure (CP-2)

(4) Long-Term Committal Measure (CP-4)

(5) Alternative Control Plans (ACPs)

c. Emission Reductions

d. EPA Action

5. Pesticides

a. Review of Measures

b. Response to Comments

c. Emission Reductions

d. EPA Action

B. Local ROP and Attainment Plans and Measures

1. Emission Inventories

a. Response to Comments

b. EPA Action

2. San Diego

a. Control Measures

b. ROP Provisions

c. Modeling and Attainment Demonstration

d. Overall EPA Action

3. San Joaquin Valley

a. Control Measures

b. ROP Provisions

c. Modeling and Attainment Demonstration

d. Overall EPA Action

4. Sacramento

a. Control Measures

b. ROP Provisions

c. Modeling and Attainment Demonstration

d. Overall EPA Action

5. Ventura

a. 1995 AQMP Update

b. 1990 Base Year Inventories

c. Control Measures

d. ROP Provisions

e. Modeling and Attainment Demonstration

f. Overall EPA Action

6. South Coast

a. Control Measures

(1) Updated Rule Adoption Schedule

(2) TCM Substitution

(3) Near-Term Control Measures

(4) New-Technology Measures

(5) EPA Action

b. ROP Provisions

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c. Modeling and Attainment Demonstration

d. Overall EPA Action

7. Southeast Desert

a. Control Measures

b. ROP Provisions

c. Modeling and Attainment Demonstration

d. Overall EPA Action

III. Summary of EPA Actions

IV. Regulatory Process

A. Executive Order 12886

B. Regulatory Flexibility Act

C. Unfunded Mandates

D. Submission to Congress and the General Accounting Office

E. Petitions for Judicial Review

Appendix A: Current Status of EPA's Activities Relating to the

``Federal Assignments'' in the California SIP Submittal

Appendix B: Schedule for Public Consultative Process

I. Background

A. Summary

EPA is finalizing approval of the 1994 California Ozone SIP.1

This action was proposed on March 18, 1996 (61 FR 10920-10962). The

reader is referred to that notice for additional detail on the affected

areas and the SIP submittals, as well as a summary of relevant Clean

Air Act requirements and EPA interpretations of those requirements.

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\1\ EPA will take action on the Santa Barbara SIP separately.

After EPA's proposed approval was issued, ozone violations were

recorded, which prevent the Santa Barbara area from meeting its

attainment goals this year.

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Specifically, EPA is approving in this document:

The emission inventories in San Diego, San Joaquin,

Sacramento, Ventura, the Southeast Desert, and the South Coast; 2

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\2\ The respective Federal ozone nonattainment areas are: San

Diego Area, San Joaquin Valley Area, Sacramento Metro Area, Ventura

County Area, Southeast Desert Modified AQMA Area, and Los Angeles-

South Coast Air Basin Area. The boundaries of these areas are set

forth at 40 CFR 81.305.

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The 15% rate-of-progress plans for San Diego, San Joaquin,

Ventura, and the South Coast;

The post-1996 rate-of-progress plans for San Diego, San

Joaquin, Sacramento, Ventura, and the South Coast;

The modeling and attainment demonstrations in San Diego,

San Joaquin, Sacramento, Ventura, the Southeast Desert, and the South

Coast;

All of the individual local control measures and the State

control measures not previously approved; and

The State's motor vehicle inspection and maintenance (I/M)

program and regulations.

This approval indicates EPA's belief that this SIP, if faithfully

implemented, will achieve clean air for California. The health of all

Californians now depends on the dedication of the State to see that the

plans are carried out. While the State may submit revisions to change

individual strategies, EPA intends to hold it accountable for timely

delivery of the commitments in the plans approved today.

An important aspect of EPA's approval involves the establishment of

a public consultative process intended to identify the future mobile

source strategies to provide the remaining emission reductions needed

for attainment in the South Coast, which remains the Nation's only

extreme ozone nonattainment area.

In submitting its 1994 SIP, the State maintained that achievement

of clean air goals in the South Coast required further emission

reductions from national and international mobile sources, as a

supplement to the State's own aggressive mobile source control program

and the massive contribution made by locally adopted regulations and

control measures. The State argued that California lacked the legal

authority or practical ability to control these sources, and that the

Federal efforts were essential for progress and attainment in the South

Coast because there are no feasible alternatives, in light of the

stringent State and local controls on all other sources.

The State identified in the proposed SIP specific mobile sources

requiring future Federal controls: onroad and nonroad vehicles and

engines, pleasure craft, marine vessels, aircraft, and locomotives. For

each source, the State specified a desired level of emission reductions

and the years for Federal adoption and implementation.

Under the Constitution and the Clean Air Act, EPA does not believe

that a state has authority to assign emission reduction

responsibilities to the Federal government. Nevertheless, EPA believes

that the Federal government should help speed clean air, not only in

California but on a national basis.

Since the Clean Air Act Amendments of 1990, EPA has already issued

30 national regulations to help reduce emissions from mobile sources.

Examples of important recent national controls include: (1) The heavy

duty truck and bus rules for NOX and PM issued in May 1993; (2)

the NOX standards for nonroad diesel engines 37kW and above

promulgated in 1994; (3) the small nonroad gasoline engine standards

(primarily for lawn and garden equipment) finalized in July 1995; and

(4) the pleasurecraft engine standards issued in August 1996.

EPA will issue further national controls for remaining mobile

source categories. In doing so, the Agency must set controls based on

national considerations and criteria established by Congress in the

applicable sections of Title II of the Act.

Since the 1994 California Ozone SIP was submitted, EPA has been

working cooperatively with California and other stakeholders to develop

more stringent controls for both onroad and nonroad vehicles and

engines. These constructive, consensus-building activities have

received widespread national support from the affected industries,

states, and the environmental community, and have already resulted in

agreement on stringent new national controls for highway trucks and

buses, proposed on June 27, 1996 (61 FR 33421-33469), and for nonroad

compression-ignition engines (agreement signed by EPA, California, and

industry, on September 13, 1996). The proposed controls achieve

California's reduction targets for these source categories while at the

same time avoiding the inefficiencies and dislocation that would result

from different and possibly conflicting Federal and California

standards.

As a result of such successes, EPA is optimistic that the year-long

consultative process will succeed and provide emission reductions that

complement the California State and local controls contained in the

South Coast SIP. The current status of EPA's activities in developing

further mobile source controls is presented in Appendix A of this

document.

In order to allow time to evaluate what additional mobile source

reductions can contribute to ozone attainment in the South Coast, EPA

intends to continue and broaden the consultation with the State and

other affected parties through June 1997. As stated in the proposal,

the Agency believes that this period provides the opportunity to agree

on future mobile source reductions that will meet our environmental

goals expeditiously and without adverse consequences to the State and

the South Coast, whether the controls come from national and

international standards or from new State and local measures.

On July 19, 1996, EPA held the first of several meetings in Los

Angeles to describe the public consultative process and stimulate a

useful exchange of ideas on innovative and ambitious approaches to

achieve our pollution reduction targets. Appendix B to this document

gives more details on the public consultative process and proposed

future meetings.

At the conclusion of the consultative process, EPA believes that

the State will have the information it needs to amend

[[Page 1152]]

the South Coast attainment demonstration appropriately, based on the

final mix of international, national, State, and local mobile source

controls. The State has agreed, and has committed to submit a revised

attainment demonstration by December 1997, and to adopt and submit any

needed State measures by December 1999. As proposed, EPA is making a

comparable enforceable commitment to undertake rulemakings, after the

consultative process, on any controls which are determined to be

appropriate for EPA.

EPA believes that, by working together with the State, local

government, affected industry, environmental groups, and the general

public, we can identify approaches to fulfill our public health

obligations in ways that support progress in other areas of public

concern.

The data collected and analyses performed as part of EPA's

forthcoming report to Congress on the Benefits and Costs of the Clean

Air Act demonstrate that air pollution control activities, while

costly, have returned far greater economic benefits.3 Similarly,

California-specific studies have recently underscored the State's

historic success in reconciling economic growth with air quality

progress.4

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\3\ See The Benefits and Costs of the Clean Air Act, 1970 to

1990, USEPA report prepared for US Congress under section 812 of the

Clean Air Act, Draft report issued May 3, 1996. USEPA expects to

issue the final report in the near future, along with a similar

prospective analysis on benefits and costs of the 1990 Clean Air Act

Amendments.

\4\ See Alan Gordon, Myths of Jobs vs. Resources: Environmental

Protections and Economic Growth, March 1996 (report prepared for the

California Senate Office of Research), and Anil Puri, Significance

of California Air Pollution Control Regulations for Business

Location Decisions, May 1995 (report prepared for the California Air

Resources Board Research Division).

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If successfully implemented, the 1994 California Ozone SIP will

succeed even more completely than previous clean air plans in

harmonizing public health progress with the social and economic goals

of the State's citizens. Federal approval of the 1994 SIP will help to

provide the regulatory certainty needed to sustain and accelerate

California's progress in achieving State and Federal clean air

objectives. EPA will continue to work together with California to

achieve the clean air that our citizen's deserve.

B. Response to Public Comments on General SIP Issues

1. Federal Assignments.

a. Importance of Federal Contribution and Difficulty of Further

Local Controls. As discussed in the proposal, the 1994 California Ozone

SIP includes 7 specific mobile source control measures assigned to the

Federal government. These measures, which were in addition to those

already promulgated by EPA, comprised a more stringent heavy-duty

diesel vehicle standard, an off-road diesel equipment standard, a

standard for gasoline- and LPG-fueled industrial equipment, national

and international standards for marine vessels, national standards for

locomotives with a South Coast clean locomotive fleet program, national

standards for aircraft, and standards for pleasurecraft.

EPA received many comments underscoring the critical need for

reductions from additional national regulations if California areas,

particularly the South Coast, are to achieve healthy air quality. Most

of these comments added a corollary: Further State and local controls

could not reasonably be expected, given the comprehensiveness and

stringency of existing regulations and committal measures in the SIP.

As stated in the proposal, EPA recognizes that national and

international mobile sources are increasingly significant components of

the ozone problem, especially in the South Coast, and EPA is committing

at this time to undertake the rulemaking on those controls that are

determined to be appropriate. The increased Federal contribution that

will come from ongoing national mobile source control measures, plus

the State and local control measures in the SIP, add up to almost all

of the needed emission reductions. EPA is confident that a small

shortfall, if it still exists at the end of the public consultative

process, will be addressed by cooperative Federal, State, and local

strategies, without adverse impacts.

b. Public Consultative Process. The California Environmental

Protection Agency (CEPA) commented that the proposed consultative

process is much like the participatory approach California has used for

many years to develop new environmental programs. CEPA stated that

CARB's staff are prepared to begin work right away with EPA and other

stakeholders to develop appropriate controls.

The American Association of Railroads (AAR) commented in support of

EPA's proposed consultative process as an innovative and useful method

to help assure that the SIP's goals are met.

Over twenty years of efforts to clean the air in Southern

California have taught that cooperation and innovation by all parties

are essential if attainment is to be achieved while retaining a healthy

economy. The proposed consultative process builds on that experience,

and in that manner provides a reasonable basis for EPA approval of the

South Coast attainment demonstration.

The Western Riverside Council of Governments (WRCOG) supported the

continuation and expansion of the collaborative process. WRCOG asked

that a formal participation program should be developed as part of the

consultative process, to provide a framework in which local governments

and business communities could participate, since local agencies are

required to implement whatever control measures are adopted from this

process and success depends upon local government ``buy-in.'' The City

of Los Angeles also requested that EPA establish a list of key

stakeholders and begin seeking input through a formal process.

EPA agrees that local government participation in the design and

review of control measures is critically important to ensure that the

measures are efficient, acceptable to the affected communities, and

successfully implemented. The Agency hopes that the process can be an

open and informal exchange of ideas from the community at large. EPA

believes that this is the most efficient structure and approach, in the

limited amount of time, to share and receive important information that

will help all participants to understand the issues involved and the

opportunities to achieve the remaining emissions reductions needed from

mobile sources.

c. Legal and Policy Issues. The Environmental Defense Center

opposed EPA's proposed public consultative process to resolve the SIP's

future mobile source component. EDC expressed perplexity at EPA's

reliance on and endorsement of California's assignment of emissions

reductions to meet California's shortfall in attainment demonstration

for the South Coast:

The novel ``consultative'' process is without basis in law or

propriety under the facts. EPA should not accept ``assignment'' of

California's shortfall; this action violates the Act, perverts the

local air quality planning process, and rewards California's

unwillingness to address its own air quality problems. The precedent

is highly disfavorable to clean air and jeopardizes the health and

well being of everyone in the United States.

As stated in the Notice of Proposed Rulemaking (NPRM), EPA believes

that California does not have the authority to assign SIP

responsibility to the Federal government. However, EPA recognizes that

massive further reductions are needed for attainment in the South Coast

and that attainment may be either

[[Page 1153]]

very costly and disruptive or impossible if further reductions are not

achieved from national and international sources.

EPA therefore established the public consultative process to

resolve the complex issues associated with national and international

sources and to determine what combination of controls at various levels

are appropriate to contribute to the remaining emission reduction needs

in the South Coast. Both EPA and the State have made enforceable

commitments to prepare the controls that are determined, after the

public consultation process, to be appropriate for them. Under these

commitments, any new Federal or State rules both can and will be

adopted before they are required to meet progress or attainment

requirements in the South Coast. EPA also believes that those national

or international controls that issue from the public consultative

process will benefit, rather than disfavor, clean air elsewhere in the

United States.

The ``Federal Assignments'' portion of the SIP is approvable

because it is consistent, in the overall context of the California SIP,

with the Clean Air Act requirements. The California SIP as a whole is

approvable as long as, among other things, it includes ``[a]

demonstration that the plan * * * will provide for attainment'' of the

NAAQS. CAA section 182(c)(2)(A). As set forth in the proposal and below

in section II.B.6., the South Coast SIP regulations and commitments,

coupled with promulgated Federal measures, provide the great bulk of

reductions needed for attainment. The amount of reductions expected

from the consultative process is a small percentage of the overall

amount of reductions needed for attainment. In addition, granting

additional time for identifying and adopting the remaining measures is

consistent with the statutory scheme because the time delays are

relatively brief, in the context of the SCAB attainment process, and

thus do not interfere with the deadline for ROP and attainment.

EPA counts towards the attainment demonstration reductions from

measures resulting from the consultative process, even though those

measures have not yet been determined, in part because of the practical

and technical challenges of providing for attainment in the South

Coast. The SIP provisions for the South Coast already include control

requirements that, in general, are more expensive and technologically

advanced, and apply to smaller emitters, than any other SIP in the

nation.5 Generating additional emissions reductions from

additional SIP measures presents a high magnitude of complexity. Such

additional SIP reductions may prove unnecessary depending on whether

and how many additional reductions from other Federal measures will

occur.

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\5\ See, for example, SCAQMD rules 1111 (Nox from Gas Fired

Furnaces), 1109 (Refinery Boilers & Process Heaters), 1134 (Nox

from Stationary Gas Turbines), 1135 (Nox from Electric Power

Generating Systems), 431.2 (Liquid Fuel Sulfur Content), 1142

(Marine Tank Vessel Operations), 1113 (Architectural Coatings), 1128

(Paper, Fabric & Film Coating Operations), 1106.1 (Pleasure Craft

Coating Operations), 1130.1 (Screen Printing Operations), 1168 (VOCs

from Adhesive Applications), 1175 (Polymeric Cellular Products--

Blowing Foam), 1146 and 1146.1 (Industrial, Institutional, and

Commercial Boilers, Generators, & Heaters), 1162 (Polyester Resin

Operation), 1110.1 & 1110.2 (Emissions from Internal Combustion

Engines), 1151 (Motor Vehicle Non-Assembly Line Coatings), 1124

(Aerospace Assembly & Component Manufacturing Operations), 1153

(Commercial Bakery Ovens), 462 (Organic Liquid Loading, 461 (Gas

Transfer and Dispensing), 1136 (Wood Products Coatings), and

Regulation XX (Nox/Sox RECLAIM program). See also the CARB

rules for motor vehicles and fuels (generally), off-highway

recreational vehicles and engines, consumer products (generally),

and aerosol coating products.

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Both EPA and the State are committing to undergo the consultative

process described above, and to promulgate controls determined by that

process to be appropriate. Those EPA and State commitments are

enforceable by citizens. Based on these commitments, EPA will assure

that the gap in emissions reductions represented by the consultative

process, and needed to attain, will be closed. For example, at the

close of the consultative process, EPA may promulgate a rulemaking that

identifies (i) additional SIP reductions that EPA considers appropriate

for California to undertake, and additional Federal measures that EPA

intends to promulgate; as well as (ii) schedules for the adoption or

promulgation and implementation of both sets of measures.

For these reasons, EPA has concluded that the SIP for the South

Coast, with its limited reliance on additional reductions to be

determined through a consultative process, ``provide[s] for''

attainment, under section 182(c)(2)(A) of the Act.

EPA believes that CAA section 172(c)(6) supports its conclusion

that the California SIP, including the consultative process

commitments, ``provide[s] for'' attainment under section 182(c)(2)(A).

Section 172(c)(6) of the Act requires, as a rule generally applicable

to nonattainment SIPs, that the SIP ``include enforceable emission

limitations, and such other control measures, means or techniques * * *

as may be necessary or appropriate to provide for attainment * * * by

the applicable attainment date * * *.'' (Emphasis added.) The

emphasized terms mean that enforceable emission limitations and other

control measures do not necessarily need to generate reductions in the

full amount needed to attain. Rather, the emissions limitations and

other control measures may be supplemented with other SIP rules--for

example, the commitments EPA is approving today--as long as the entire

package of measures and rules provides for attainment. Under these

circumstances, the emission limitations and control measures generate

reductions in an amount that falls short of the amount needed to

attain; yet those limitations and measures are all that is necessary or

appropriate to attain in light of the additional SIP rules for

commitments.

EPA finds further support for its action in the Ninth Circuit's

decision in Kamp v. Hernandez, 752 F.2d 1444 (1985). There, the court

upheld EPA's full approval of a SIP that relied on a State's agreement

to submit a fugitive emission control plan in the future. Although

recognizing that lack of any controls on fugitive emissions would

prevent attainment, the court justified its holding on the grounds that

the plan was substantially complete, and that the remaining shortfall

would be covered under the state's future submission. The court also

interpreted the predecessor provision to section 172(c)(6) in a manner

consistent with EPA's interpretation of section 172(c)(6) above.

EDC commented that it is unclear how the ``meet and confer''

commitments meet the minimal requirements of the Administrative

Procedures Act (APA) and the public participation elements of the CAA.

EPA believes that these requirements will be met and intends a

process with more than the legally-mandated public opportunities for

input. All Federal mobile source measures will be issued through

rulemaking that complies with the CAA and APA provisions. EPA will

ensure that all other future SIP measures go through a fully public

process that complies with applicable APA and CAA requirements for

public involvement. Finally, any necessary revisions to the South Coast

attainment demonstration must comply with all applicable public

notification, public hearing, and public participation requirements.

EDC commented that the practical and legal insufficiency of the

``Federal Assignments'' portion of the SIP is reflected in EPA's

proposal to make enforceable commitments to undertake additional

rulemakings after a

[[Page 1154]]

consultative process (which EDC described as ``secret'') on control

measures necessary to achieve the emissions reductions determined to be

appropriate for EPA. EDC added: ``This promise to make future promises

provides no certainty, specificity or meaning, and violates the spirit

and letter of the CAA.''

In today's action, EPA finalizes its commitment to undertake

rulemaking on any measures which are determined to be EPA's

responsibility, and EPA finalizes its approval of California's

enforceable commitment to adopt measures determined to be the State's

responsibility. These enforceable commitments, in conjunction with the

other SIP measures and other sources of emissions reductions,

constitute the required demonstration of attainment and ROP. As noted

in the discussion of the ``Federal Assignments'' (see Appendix A),

significant progress has already occurred or is expected in the near

future with respect to accomplishing, in enforceable form, specific

regulations (such as EPA's recently proposed national standards for

heavy-duty onroad vehicles) that achieve the vast majority of required

reductions.

EPA has authority to commit itself to promulgate additional Federal

measures determined through the consultative process to be appropriate,

under CAA section 301. This provision authorizes the Administrator to

``prescribe such regulations as are necessary to carry out his

functions under [the Clean Air Act].'' In title I of the Act, Congress

set out what amounts to a ``blueprint'' by which nonattainment areas

will attain the NAAQS. This blueprint couples SIP reductions with

reductions from various Federal measures, such as reductions from

mobile source measures promulgated by EPA under Title II of the Act.

The EPA commitment prescribed in today's rulemaking is necessary to

carry out EPA's functions both in promulgating mobile source

regulations under Title II and in fulfilling its share of the

``blueprint'' reductions needed for attainment.

EPA proposed a public, not a secret, consultative process, and the

Agency sets forth in Appendix B to this document more details on

opportunities for the public to be involved in the difficult

decisionmaking on what additional controls on mobile sources need to be

adopted at the Federal, State, and local level. EPA's commitment,

finalized in this action, is as specific and enforceable as possible,

prior to the completion of critically important public input and

consultation. After the consultative process is completed, in June

1997, responsibility for the small increment of necessary additional

emission reductions should be fully resolved.

The Natural Resources Defense Council (NRDC) and the Coalition for

Clean Air (CCA) submitted joint comments opposing EPA's proposed

resolution of the ``Federal Assignments.'' The environmental groups

stated that EPA's proposed approval violates the CAA by providing full

credit toward attainment for ``Federal Assignments'' in the SIP.

Although NRDC and CCA encouraged federal-state cooperation to achieve

healthful air in the South Coast, they felt that the consultative

process combined merely with gap-filling commitments cannot be used to

circumvent the November 1994 deadline in the CAA for the State to

provide evidence that it has the legal authority to implement and

enforce all SIP provisions. NRDC and CCA commented that EPA cannot

approve a SIP which relies for ROP and attainment on prospective

federal measures over which CARB has no control and which have neither

been formally proposed nor promulgated.

NRDC and CCA observed that some of what they describe as the

``nonexistent'' federal measures are given credit as early as 1999, but

CARB is not required to submit replacement measures until the end of

1999. NRDC and CCA argued that the State should cover the ``Federal

Assignments'' emissions in its 1994 SIP, which could then be revised to

decrease the State's responsibilities as EPA adopts new federal

regulations. The environmental groups stated that there is no reason

why CARB cannot immediately begin development of these rules concurrent

with the consultative process. Finally, NRDC and CCA commented that EPA

should require that CARB immediately adopt rules, scheduled for

implementation in the year 2000 or later, as backstop measures which

will go into effect to the extent necessary to make up a shortfall that

remains after the consultative process.

EPA's responses to EDC's comments address many of these concerns.

EPA believes that the public consultative process for resolving mobile

source emission reductions is appropriate to the unique facts of the

South Coast attainment demonstration. The 1994 SIP submittal includes

massive reductions achieved by combined State and local regulations and

commitments, covering every significant source category. It is not

clear what feasible measures could be adopted by the State and local

agencies at this time to cover the entire emission reductions included

in the ``Federal Assignments.'' The additional time which EPA is

allowing for the evaluation and development of future Federal controls,

revision to the SIP's attainment demonstration, and then adoption, if

necessary, of any gap-filling measures, is justified by the magnitude

and complexity of the issues involved in regulating sources that have

never previously been subject to emission standards and sources that

are critical components of interstate and, in some cases, international

commerce.

Furthermore, for the larger emission reduction categories in the

``Federal Assignments,'' CARB has matched the national controls with

its own measures to adopt and implement at least equivalent State

controls under the State's unique CAA authorities to regulate mobile

sources. The success of this enterprise to develop cooperative and

consistent Federal-State mobile source emission standards would

eliminate for manufacturers and users the costs of compliance with

conflicting standards and test procedures.

d. Comments Specific to Source Categories. (1) Military Exemption.

The U.S. Navy and U.S. Coast Guard expressed concern about any

reconsideration of the exempt status of military aircraft as part of

the exploration of more stringent standards for aircraft engines, and

both agencies expressed a desire to be involved in future discussions.

EPA hopes that these agencies will participate fully in the public

consultative process to help in Federal, State, and local cooperative

efforts to identify viable strategies for achieving our air quality

goals.

(2) Locomotives. The Association of American Railroads (AAR)

commented that the consultative process should not be used as a route

to develop any State or local regulations imposing locomotive controls

for the purpose of reducing emissions. AAR expressed concern that SIP

measure M14 indicates that CARB ``will also consider operational

controls, such as reduced idling and use of California diesel fuel, if

* * * additional emission reductions are needed.'' AAR argued that

these types of state and local standards and requirements must be

avoided in order to avert adverse effects on interstate commerce. AAR

recommended that the consultative process be used to devise ways to

maintain the competitiveness of railroads and improve their volume of

intercity, long-haul freight, given the significant emissions

advantages of rail transportation over trucks. AAR further requested

that EPA work with the railroads and other stakeholders to design

mechanisms to properly account

[[Page 1155]]

in the SIP for the NOx benefits of rail transportation.

EPA trusts that the rail industry will raise these important issues

in the public consultative process.

AAR also raised legal issues regarding the authority of States to

adopt and implement any type of emission-related standard or other

requirement for locomotives. These issues are more germane to EPA's

forthcoming rulemaking to establish national locomotive regulations and

to clarify the extent to which States are preempted from adopting or

implementing locomotive controls.

(3) Ships and Shipping Channel. The U.S. Coast Guard reiterated its

concerns expressed at the time of EPA's proposed Federal Implementation

Plan for California areas regarding any operational controls on marine

vessels, including international legal implications. The U.S. Navy

supported EPA's position that recommendations regarding movement of the

shipping channel should await the results of ongoing studies. The Navy

opposed any strategy that would increase traffic in the Pt. Mugu Sea

Test Range.

EPA welcomes the involvement of these agencies in the public

consultative process. EPA will particularly appreciate the assistance

of the Coast Guard in clarifying international issues as they affect

potential controls on the emissions or operations of ocean-going

vessels, and the continued constructive involvement of the Navy in

studies to help assess the air quality benefits of moving the shipping

channel.

e. EPA Action. EPA approves the State's commitments to revise the

South Coast attainment demonstration and adopt appropriate measures

following the conclusion of the public consultative process, and EPA

finalizes its commitment to undertake rulemaking on any controls which

are determined to be appropriate for EPA.

2. EPA Approval of Attainment Demonstrations that Rely, in Part, on

Commitments. The Natural Resources Defense Council and the Coalition

for Clean Air (NRDC/CCA), in a joint comment letter, contended that EPA

cannot approve the California ozone SIP because the majority of

emission reductions in the plan are in the form of commitments and not

adopted rules as required by the CAA. NRDC/CCA also asserted that

approval of such committal SIP provisions would lead to an

inappropriate delay in the statutory SIP submittal deadline. To support

these propositions, NRDC/CCA cite the holding of Natural Resources

Defense Council v. EPA, 22 F.3d 1125 (D.C. Cir. 1994); the alleged

effect of EPA's interpretation of the conditional approval provision of

the CAA, section 110(k)(4); and the language of EPA's regulation at 40

CFR 51.281.6

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\6\ NRDC/CCA also claim that the SIP inappropriately relies on a

September 1994 EPA memorandum, ``November 1994 Ozone SIP's--

Rulemaking Policy,'' to support the inclusion of commitments in the

plan. As NRDC/CCA correctly point out, this memorandum was rescinded

in 1995. Because EPA is not relying on the 1994 memorandum to

support its approval of California's SIP commitments, it is

irrelevant to this rulemaking and is therefore not addressed further

in this notice.

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In the NRDC case, the Court addressed the merits of EPA's

interpretation, as set forth in various policy memoranda, that in

certain circumstances section 110(k)(4) of the CAA allows conditional

approval of commitments unaccompanied by regulatory measures.7 In

these policy memoranda, EPA provided that it would consider conditional

approval of SIP submittals, which were meant to fulfill certain

specific SIP requirements and which consisted entirely of a commitment

letter to submit the required measure by a date certain, but no later

than one year after conditional approval. In reviewing these policies,

the Court concluded, based on the express language of section

110(k)(4), the CAA's general SIP approval scheme, and the legislative

history of section 110(k)(4), that:

\7\ Section 110(k)(4) of the CAA provides:

(4) Conditional approval--

The Administrator may approve a plan revision based on a

commitment of the State to adopt specific enforceable measures by a

date certain, but not later than 1 year after the date of approval

of the plan revision. Any such conditional approval shall be treated

as a disapproval if the State fails to comply with such commitment.

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* * * the conditional approval mechanism was intended to provide

the EPA with an alternative to disapproving substantive, but not

entirely satisfactory, SIPs submitted by the statutory deadlines and

not, as the EPA has used it, a means of circumventing those

deadlines. 22 F.3d at 1134-35.

The Court found that on its face the language of section 110(k)(4)

``seems to authorize conditional approval of a substantive SIP or SIP

revision which, though not approvable in its present form, can be made

so by adopting specific EPA-required changes within the prescribed

conditional period.'' 22 F.3d at 1134. The Court also noted that the

CAA requires EPA to make completeness determinations on required plan

submittals and that such determinations could not reasonably be made

unless the submittal contains ``something more than a mere promise to

take appropriate but unidentified measures in the future.'' Id.

Finally, the Court determined from the legislative history of section

110(k)(4) that the contemplated specific and enforceable measures are

to be additional to some specific enforceable measures already in the

SIP. Id.

NRDC/CCA apparently interpret the NRDC holding as precluding EPA

from accepting in a SIP submittal any commitments to adopt rules at a

future date, even where that submittal includes a significant quantity

of emission reductions in adopted form. We believe that such an

interpretation is far too broad a reading of the NRDC case and that the

circumstances presented by today's action are readily distinguishable

from those in the NRDC case.

First, and most importantly, EPA is not approving the California

SIP commitments under section 110(k)(4), but rather under sections 301

and 110(k)(3), as discussed below. Thus the Court's analysis of the

express language of section 110(k)(4) and its specific legislative

history is not, as NRDC/CCA claim, applicable to EPA's action here. For

the reasons set forth below, EPA's authority to approve enforceable

commitments under sections 110(k)(3) and 301 is not constrained by

section 110(k)(4).

Furthermore, to the extent that the NRDC case has any relevance to

EPA's action under sections 110(k)(3) and 301, in the present case, EPA

has not proposed to approve submittals that consist only of a

commitment. The EPA policies at issue in NRDC permitted a state to

initially satisfy an individual CAA requirement (e.g., an inspection

and maintenance program) with only a commitment to adopt such a

requirement in the future. In contrast, the SIP approved by EPA today

contains in adopted, enforceable form a large percentage of the

emission reductions that make up the required submittal, in this case,

the attainment demonstrations.8 In addition, the California ozone

SIP, because of its many substantive, adopted rules, does not pose the

barrier to a completeness determination that the Court in NRDC

perceived where only a commitment existed.

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\8\ Because they include such major substantive components, the

attainment demonstrations do not circumvent the submittal deadline

in the CAA as NRDC/CCA claim. See, e.g, tables for each area on ROP

Forecasts and Targets, Local Control Measures, and Attainment

Demonstrations. These tables summarize far more expansive

discussions and data in the actual SIP submittals, which for some

areas amount to many volumes and thousands of pages of relevant

information and analyses in support of the attainment

demonstrations.

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NRDC/CCA claim that full approval of the commitments in the

California ozone SIP (pursuant to sections 110(k)(3) and 301) would

render section

[[Page 1156]]

110(k)(4)'s conditional approval mechanism meaningless. We disagree

with this conclusion. Historically, EPA has interpreted the CAA to

allow states to submit enforceable commitments to adopt rules in the

future. The enactment of section 110(k)(4) in 1990 provided a new type

of approval for a limited set of commitments that, in general, could

not be enforced under sections 113 and 304 of the Act 9; there is

no evidence that Congress intended this limited provision to replace

EPA's well-established policy of using its general approval authority

to approve enforceable commitments. In fact, other provisions in the

statute belie that result. Finally, there continue to be strong policy

considerations for interpreting the statute to allow for approvals

under section 110(k)(3) of enforceable commitments.

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\9\ In commenting on EPA's proposed SIP approval action, the

Environmental Defense Center (EDC) suggested that EPA approve the

SIP's commitments under section 110(k)(4) rather than section

110(k)(3) because of the important enforceability benefits of a

conditional approval. As discussed below, commitments that are

conditionally approved cannot be enforced.

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EPA interpreted the pre-amended Act to allow for approval of

attainment demonstrations that included, in part, enforceable

commitments to adopt rules in the future. And courts have found these

commitments to be enforceable by the public under the citizen suit

provisions of the Act. See, e.g., American Lung Association of New

Jersey v. Kean, 670 F.Supp. 1285 (D.N.J. 1987), affirmed, 871 F.2d 319

(3rd Cir. 1989); NRDC v. N.Y. State Dept. of Environmental

Conservation, 668 F.Supp. 848 (S.D.N.Y. 1987); Citizens for a Better

Environment v. Deukmejian, 731 F. Supp. 1448, reconsideration granted

in part, 746 F.Supp. 976 (N.D. Cal. 1990); Coalition v. City of New

York, 967 F.2d 764 (2d Cir. 1992); Trustees for Alaska v. Fink, 17 F.3d

1209 (9th Cir. 1994).10

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\10\ Courts have also upheld EPA's approval of SIPs that contain

enforceable commitments. See, e.g., the cases cited below in the

discussion of 40 CFR 51.281.

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In enacting section 110(k)(4), Congress enacted a much more limited

type of approval of commitments. First, conditional approval under

section 110(k)(4) is for a very limited duration--the commitment must

provide a date certain for submittal that cannot exceed one year after

conditional approval. Furthermore, in contrast to the enforceable

commitments historically accepted by the Agency and the courts, section

110(k)(4) anticipates that the commitment made by the State will not be

an enforceable commitment. Under the express language of section

110(k)(4), upon the State's failure to meet the commitment, the

conditional approval must be converted to a disapproval. Once a SIP is

disapproved, there is no longer any commitment left to enforce under

section 113 or 304 of the Act.11

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\11\ A disapproved SIP--i.e., a plan rejected by EPA--is not

considered to be federally enforceable. Both sections 113(a)(1) and

304(a) and (f)(3) provide for enforcement regarding a violation of

only an ``applicable implementation plan,'' which CAA Sec. 302(q)

defines as a plan ``which has been ``approved'' or ``promulgated''

under section 110.

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There is nothing in the legislative history of the 1990 CAA

Amendments to suggest that Congress's addition of section 110(k)(4),

which is much more limited in scope, was intended to preclude EPA's

prior practice. Furthermore, other provisions of the amended Act

indicate that Congress contemplated continued approval of enforceable

commitments. For example, section 182(e)(5) of the CAA, which concerns

attainment demonstrations for extreme ozone nonattainment areas,

addresses the ``anticipate[d] development of new control

technologies.'' This section provides that EPA may approve provisions

relying on such technologies if, among other things, the state submits

``enforceable commitments to develop and adopt contingency measures to

be implemented * * * if the anticipated technologies do not achieve

planned reductions. These enforceable commitments would clearly need to

extend well-beyond the maximum one-year period that may be granted for

conditional approval under section 110(k)(4). Nothing in the language

of section 182(e)(5) indicates that Congress authorized those

enforceable commitments ``notwithstanding'' section 110(k)(4).

Nor does EPA agree with NRDC/CCA's assertion that approval of

enforceable commitments constitutes an inappropriate delay in the

statutory SIP submittal dates. Congress anticipated that section

110(k)(4) would result in submittal delays for some SIP measures beyond

the initial submittal deadlines. EPA believes that the delays in

submittal of final rules that would result in this action are

permissible under section 110(k)(3) because the State has obligated

itself to submit the rules by specified, short-term dates, and that

obligation is enforceable by EPA and the public. Moreover, as noted

above, the SIP submittal approved today contains major substantive

components submitted as adopted regulations. As such, the California

submittal is readily distinguishable from the submittals that were the

subject of the NRDC case.

Finally, as matter of policy it is important to continue to read

section 110 as allowing for full approval of SIP submittals containing

some enforceable commitments. The conditional approval provision is

most effectively used where a State makes a short term commitment to

correct a problem or fill a gap in a SIP submission. If the State fails

to meet the commitment, the conditional approval is converted to a

disapproval and an 18-month clock for sanctions and a 2-year period for

promulgation of a federal implementation plan (FIP) start. However,

neither EPA nor citizens have authority under the CAA to take action to

enforce those commitments that have been converted to a disapproval.

While a disapproval may motivate a state to ultimately meet its

commitments, through the potential for sanctions and a FIP, in some

cases it may be more desirable to have an approved commitment that EPA

or a citizen can enforce directly in court. Approval under section

110(k)(3) allows for enforcement action. Such a remedy is frequently

preferable in promoting actual air quality improvements. Moreover, even

with respect to an approved commitment, EPA may start the sanctions

process through a finding of failure to implement if the state does not

meet its enforceable commitment.

EDC commented, with apparent approval, on the vehicle of

enforceable commitments. EDC maintained, however, that the

Administrative Procedure Act and notions of fairness require that they

be more fully articulated. EPA believes that the SIP commitments

approved today are sufficiently specific to be enforceable by the

Agency or the public. For example, the control measure commitments are

for particular agencies to adopt and implement specific controls by

definite dates to achieve precise emission reductions from identified

source categories for each milestone year through attainment. In the

case of the South Coast, the plan also provides detailed discussions of

the source category, the regulatory history, proposed method of control

(including descriptions of available control technologies and

operational approaches), control efficiency assumptions, rule

compliance approaches (e.g., reporting and recordkeeping requirements,

source testing, certification programs, etc.), test methods, cost

effectiveness calculations, and references to document assumptions and

provide for further information. The rules to fulfill these commitments

will be subject to notice-and-comment at the State level prior to

[[Page 1157]]

adoption and submittal to EPA; furthermore, EPA will approve or

disapprove those measures through notice-and-comment rulemaking

procedures.

Reading the statute as a whole, it is clear that Congress did not

intend section 110(k)(4) to be the sole mechanism for approving

submittals that contain at least some commitments. Furthermore, for the

above reasons, enforceable commitments serve several distinct purposes

not addressed by section 110(k)(4). Under these circumstances, EPA's

interpretation of the statute is entitled to considerable deference.

Chevron U.S.A., Inc. v. NRDC, 467 U.S. 837 (1984).\12\

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\12\ As one court has observed: The need for flexibility in the

administration of a statute whose provisions have been described as

`virtually swim[ming] before one's eyes,' * * * should not be

underestimated. We have in the past been careful to defer to EPA's

choice of methods to carry out its `difficult and complex job' as

long as that choice is reasonable and consistent with the Act * *

*. Connecticut Fund for the Environment, Inc. v. EPA, 672 F.2d 998,

1006 (2d Cir.), cert. denied, 459 U.S. 1035 (1982).

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NRDC/CCA also assert that EPA is precluded from approving the

commitments in the California ozone SIP because EPA's regulation at 40

CFR 51.281 \13\ requires SIPs to include adopted rules and regulations.

EPA has long interpreted this regulation to require States, when

submitting rules and regulations, to submit those regulations in

adopted rather than proposed form.\14\ EPA has not interpreted this

regulation to require that every submittal must be in regulatory form.

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\13\ 40 CFR 51.281 provides, in pertinent part: Emissions

limitations and other measures necessary for attainment and

maintenance of any national standard * * * must be adopted as rules

and regulations * * *. Submittal of a plan setting forth proposed

rules and regulations will not satisfy the requirements of this

section * * *. (Emphasis added.)

\14\ In order to expedite SIP approval, EPA has occasionally

proposed to approve a state's draft rules that have been fully

developed but have not yet been adopted. An EPA approval using this

``parallel processing'' procedure, of course, cannot be finalized

until the rules have been adopted and formally submitted to EPA as a

SIP revision.

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EPA promulgated this regulation long before the enactment of the

1990 CAA Amendments. See 36 FR 22398 (Nov. 25, 1971), codified as 40

CFR 51.22; recodified as 40 CFR 51.281 with minor modifications at 51

FR 40674 (Nov. 7, 1986). As discussed above, EPA has historically

accepted enforceable commitments in SIPs and courts have found these

provisions to be enforceable by the public under section 304 of the

CAA. In addition, in a number of cases, courts of appeals in some

circuits, including the Ninth Circuit, have upheld EPA's approval of

plans that included commitments to fill gaps. See Kamp v. Hernandez,

752 F.2d 1444, 1445 (9th Cir. 1985); Connecticut Fund for the

Environment v. EPA, 672 F.2d 998 (2d Cir.), cert. denied 459 U.S. 1035

(1982); Friends of the Earth v. EPA, 499 F.2d 1118, 1124 (2d Cir.

1974).

The cited cases demonstrate that, over a long period of time, EPA

has not interpreted 40 CFR 51.281 as limiting the permissible

procedural vehicles for SIP measures to rules and regulations. Rather,

the Agency has viewed the primary purpose of section 51.281 as ensuring

that SIP submittals contain adopted, not proposed, emission limitations

and other measures. The commitments at issue here are not merely

proposed; they have been adopted by the various local air districts and

ARB. Because EPA's interpretation of its regulation is a reasonable

interpretation, it is entitled to deference. Chevron, 467 U.S. 837.

3. Additional Clean Air Act Issues

a. Attainment as Expeditiously as Practicable. The Environmental

Defense Center commented that the SIPs should be disapproved because

they fail to meet the CAA requirement of attaining the NAAQS as

expeditiously as practicable. The commenter provided no further

statutory interpretation or information relating to this CAA provision

and defects in the SIPs relating to it. EPA continues to believe that

the SIPs meet the progress requirements of the Act, as discussed in the

proposal, and provide for expeditious attainment.

b. Contingency Measures. NRDC and CCA commented that only SCAQMD's

measure CTY-01 meets the section 182(c)(9) CAA requirement for

contingency measures that take effect without further action by the

State or EPA upon a failure of the State to meet the applicable

milestone. The commenters stated that EPA should require further

definition and refinement of the contingency measures and the schedule,

funding and enforcement responsibilities required for the measure to

succeed.

EPA's proposal addressed only the following CAA requirements:

section 181(a)(1) relating to emissions inventories; section 182(b)(1)

relating to 15% ROP Plans; section 182(c)(2)(B) relating to Post-1996

ROP Plans; sections 182(b)(1)(A) and 182(c)(2) relating to modeling and

attainment demonstrations, and sections 182(b)(4) and 182(c)(3)

relating to I/M Programs. The remaining requirements of Part D of the

Act, including the sections 172(c)(9) and 182(c)(9) requirements for

contingency measures, will be acted upon in separate rulemakings.

c. Adequacy of SIP's Technical Foundations. (1) Modeling and

Treatment of Transport. The Engine Manufacturers Association (EMA)

submitted a comment that EPA has failed to provide all data and

documentation relating to the modeling in the SIPs. Noting that EPA has

admitted that problems in model performance and transport led to

California's inability to follow EPA's modeling guidelines in its

analyses, EMA asked that EPA not take final action on modeling but

should require that appropriate adjustments be made in order to provide

accurate modeling assumptions on which to base California's proposed

measures.

EPA has not provided all data and documentation relating to the

modeling analyses. For each area, modeling input and documentation

include hundreds of thousands of data. This information is available

from local air pollution agencies.

Again, EMA failed to provide specific information to support its

general conclusion. EPA recognizes the opportunities to refine the

modeling in each of the areas, including the data upon which the

modeling is based. Major modeling projects or modeling refinements are

underway in each area. EPA contributes technical and funding support to

these projects, which may provide information helpful in enhancing the

SIP strategies in the future. However, EPA believes that the current

modeling in each area meets the requirements of the Act and provides a

reasonable basis for estimating the emission reductions needed for

attainment and the ambient impact of the control measures.

(2) Impact of Changes to the ZEV Program. The Environmental Defense

Center commented that the state has already rescinded the Zero Emission

Vehicle (ZEV) program, demonstrating immediately their willingness and

intent to renege on the SIP's commitments. EDC stated that both the

Sacramento and South Coast attainment demonstrations should be

disapproved because CARB has rescinded the ZEV program. NRDC and the

Coalition for Clean Air commented that EPA needs to quantify the

increased emissions that will result from changes to the ZEV program

and should demand compensating reductions.

At a public hearing on March 28 and 29, 1996, CARB approved

revisions to the ZEV program in the California motor vehicle control

regulations. These changes included elimination of the ZEV production

requirement for the 1998 through 2002 model years. CARB retained the

10% ZEV requirement for

[[Page 1158]]

the 2003 and later model years. In order to offset the loss of emission

reductions, CARB negotiated an enforceable contractual agreement with

the vehicle manufacturers, committing them to produce cleaner 49-state

cars in the 2001 through 2003 model years. CARB prepared a staff report

demonstrating that the emission reductions achieved within the South

Coast by the cleaner 49-state vehicles exceed the emission losses from

delay of the ZEV program (See CARB Staff Report: Initial Statement of

Rulemaking--PROPOSED AMENDMENTS TO THE ZERO-EMISSION VEHICLE

REQUIREMENTS FOR PASSENGER CARS AND LIGHT-DUTY TRUCKS, February 9,

1996).

EPA shares the commenters' concerns that the SIP must be

implemented fully and that substitute measures should immediately

correct any SIP shortfalls. However, the State has argued that

successful implementation of the ZEV program requires the March 1996

rule amendments, in order to ensure that concerns relating to battery

technology and ZEV sales potential can be resolved and the ultimate

sales mandate be fully accomplished. The State has also provided

evidence that the loss in emissions from the elimination of the ZEV

mandate for the first 5 years will be offset by provisions of CARB's

enforceable contract with the automakers. EPA will carefully monitor

implementation of the contractual agreement and the ZEV program and

will require the State to revise the SIP to provide new emission

reductions if needed to meet the progress and attainment requirements

of the Act.

(3) Control Measures. NRDC and CCA commented that EPA cannot

approve the South Coast SIP because it fails to include as measures all

already adopted regulations and measures characterized as assumptions.

The environmental groups argued that the CAA and EPA's regulations

require quantification of reductions from each adopted regulation, and

that these regulations themselves should be an enforceable part of the

SIP.

With respect to the quantification of reductions from the various

regulations that comprise the existing California motor vehicle

program, the State has submitted reductions from the program as a

whole, without a disaggregation by program element. In recent

correspondence, the State has provided further detail, including an

estimate of Statewide emission reductions from each severable

component.15

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\15\ Table 1 (``Adopted state regulations in the SIP baseline,

with implementation dates in 1996 or later'') in a letter from Lynn

Terry, Assistant Executive Officer, CARB, to Julia Barrow, Chief,

Planning Office, Air & Radiation Division, USEPA, dated September

19, 1996. This correspondence is part of EPA's rulemaking docket.

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The rate-of-progress and ozone attainment demonstrations for each

area rely, in part, on emission reductions from regulations adopted by

local air pollution control districts, since the impact of these

regulations is factored into the projections of future year baseline

emissions.16 EPA has already approved the great majority of these

local regulations and expects in the near future to complete final

action on the remaining regulations. With respect to those few

regulations which are relied upon in the SIP for rate-of-progress or

attainment and which have not yet been approved as part of the SIP, EPA

construes that reliance and the fact that the local agencies have

adopted and the State has submitted the rules as SIP revisions to

constitute an enforceable commitment by these agencies to implement the

rules to achieve the reductions assumed in the rate-of-progress plans

and the attainment demonstrations.

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\16\ In a letter from Barry R. Wallerstein, Deputy Executive

Officer, SCAQMD, to Dave Howekamp, Division Director, Air & Toxics

Division, Region IX, dated September 18, 1996, the SCAQMD has

provided a list of local measures and associated emission reductions

assumed in the baseline of the South Coast SIP. This correspondence

is part of EPA's rulemaking docket.

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If the State withdraws (before EPA's final action) any of these

regulations that have been submitted but not yet approved as part of

the SIP, or if EPA's final action is a disapproval, or if EPA

determines that the rule will achieve fewer emissions reductions than

relied upon in the SIP, EPA will call upon the State to fulfill its

commitment by submitting replacement measures on an expeditious

schedule and the State will be obligated to provide such replacements.

EPA requires identification of emission reductions associated with

each of the new measures that are incorporated in the plan's rate-of-

progress and attainment demonstrations and that reduce emissions below

the baseline inventory levels. The South Coast SIP fulfills this

requirement, and EPA has included, in the tables of new measures, the

specific credit assigned.

The Engine Manufacturers Association (EMA) stated that, based on

the information provided in the NPRM, EPA and California have not

established a reasonable, cost-effective basis for certain of the

proposed regulatory measures. EMA provided no specific information to

support the comment. EPA believes that the SIP control measures are, in

fact, reasonable. Moreover, EPA does not find statutory authority for

the Agency to require states to submit analyses demonstrating that

proposed measures are reasonable, cost-effective and appropriate.

Finally, due to the nature of the Federal/state relationship under the

Act, EPA analysis of the cost-effectiveness of SIP measures would

constitute Federal inquiry into the economic reasonableness of state

action. The Act 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).

d. Consistency of Local Nonroad Measures with Clean Air Act

Preemption. The Engine Manufacturers Association commented that EPA

should not finalize approval of local measures without a determination

that they have met CAA requirements respecting preemptions on a state's

authority to regulate certain nonroad engines and applications. The

commenter did not identify any State or local measure that was

inconsistent with the Clean Air Act. EPA has not identified any

measure, approved at this time, that violates the Act's preemptions.

When regulations are adopted and submitted for SIP approval, EPA

reviews the regulations to ensure that they fall within the authority

of the State or local agency and that the regulations are otherwise

consistent with statutory and regulatory requirements.

4. Future SIP Updates and Improvements

Western Riverside Council of Governments commented that the SIP

should provide the flexibility to replace measures with local programs

that are more sensitive to local political, economic and social

conditions. EPA supports and encourages SIP flexibility that respects

the superior ability of local agencies to reconcile environmental

progress with other community goals.

The California Environmental Protection Agency (CEPA) commented

that, as EPA recognized in the proposed approval, some of California's

specific strategies may require adjustment as actual rules are

developed. CEPA stated that ``we will retain the flexibility to revise

the SIP as long as the emission reductions continue to provide for

attainment.''

As stated in the NPRM, EPA supports the State's flexibility to

revise the SIP, but cautions that EPA must review SIP revisions for

approvability under Sections 110(l) and 193. Section 110(l) prevents

EPA from approving a revision if it would interfere with any applicable

[[Page 1159]]

requirement concerning attainment and reasonable further progress, or

any other applicable requirement of the Act. Section 193 prevents

modification of control requirements ``in effect, or required to be

adopted by an order, settlement agreement, or plan in effect before

November 15, 1990 in any area which is a nonattainment area for any air

pollutant * * * unless the modification insures equivalent or greater

emission reductions of such air pollutant.''

5. Overall Approvability of Plans

Almost all of the commenters supported EPA's proposed approvals of

the plans for each area. However, comments opposing full approval of

the plans at this time were received from the Engine Manufacturers

Association, the Environmental Defense Center, the Natural Resources

Defense Council, and the Coalition for Clean Air. These comments are

addressed elsewhere in section I.B., or in discussions relating to

individual areas.

6. Importance of SIP Implementation

Several commenters reflected on the critical importance of follow

through at the local, State, and Federal levels if the SIPs are to

achieve the air quality standards. EPA agrees that all parties,

including local government and the general public, must work together

to ensure that each responsible agency honors its commitments. Because

these challenging SIPs are so important from the perspective of public

health, the success of the SIPs requires widespread public

participation and public support. EPA encourages California agencies to

report frequently to the public on progress in implementing the plans

and to involve the public in resolving implementation issues. Through

the Public Consultative Process and other forums, EPA intends to inform

and engage the public as the Agency proceeds to develop future mobile

source controls.

C. SIP Submittals

1. SIP Submittals Before EPA's Proposal

On November 15, 1994, CARB submitted a revision to the ``State of

California Implementation Plan for Achieving and Maintaining the

National Ambient Air Quality Standards'' (ozone SIP)

The revision consists of: (a) The State's comprehensive ozone plan,

including the State's own measures and the State's summaries of, and

revisions to, the local plans; (b) the State's previously adopted

regulations for consumer products and reformulated gasoline and diesel

fuels; and (c) local plans addressing the ozone attainment

demonstration and ROP requirements.

On August 21, 1995 (60 FR 43379), EPA approved the State's consumer

products and reformulated gasoline and diesel fuels regulations. At the

same time, EPA took interim approval action on CARB and SCAQMD New-

Technology Measures, under the provisions of section 182(e)(5) of the

CAA, which authorizes the Administrator to approve fully and credit as

part of an extreme ozone area SIP conceptual measures dependent upon

new control technologies or new control techniques. The new-technology

measures approved at that time were: CARB's measures M2 (Improved

Control Technology for Light-Duty Vehicles), M9 (Off-Road Diesel

Equipment), CP-4 (Consumer Products Advanced Technology and Market

Incentives), and Additional Measures; and SCAQMD measures ADV-CTS-01

(Coating Technologies), ADV-FUG (Fugitives), ADV-PRC (Process Related

Emissions), ADV-UNSP (Unspecified, Stationary Sources), ADV-CTS-02

(Coatings Technologies).

On December 14, 1995 (60 FR 64126), EPA issued the final SIP

approval of the State's mid-term control measures M3 (Accelerated

Ultra-Low Emission Vehicle requirement for Medium-Duty Vehicles), M5

(Heavy-Duty Vehicle NOX regulations), M8 (Heavy-Duty Gasoline

Vehicles lower emissions standards), M11 (Industrial Equipment, Gas and

LPG), and CP2 (Mid-Term Consumer Products).

The remaining portions of the ozone SIP submittal, upon which EPA

is acting today, include the following separate documents:

1. ``The 1994 California State Implementation Plan for Ozone,''

volumes I-IV. The November 15, 1994, submittal letter refers to other

submittals, described below, as completing the 1994 California Ozone

SIP. Volume I provides an overview of the entire submittal; Volumes II

and III include the State's measures for mobile sources, consumer

products, and pesticides; and Volume IV treats the local plans.

On December 29, 1994 and February 7, 1995, the State submitted

updates to these documents, incorporating changes made by CARB at the

time of adoption, and providing other technical and editorial

corrections.

2. ``1994 Ozone Attainment and Rate-of-Progress Plans for San Diego

County.''

3. ``San Joaquin Valley Attainment and Rate-of-Progress Plans.'' On

December 28, 1994, the State submitted the ``Rate-of-Progress and

Attainment Demonstration Plans for the Kern County Air Pollution

Control District,'' applicable to the Kern desert portion of the San

Joaquin Valley nonattainment area.

4. ``Sacramento Area Proposed Attainment and Rate-of-Progress

Plans.'' On December 29, 1994, the State replaced this with the

``Sacramento Area Attainment and Rate-of-Progress Plans.''

5. ``1994 Air Quality Management Plan for Ventura County.''

6. ``Rate-of Progress and Attainment Demonstration Plans for the

Mojave Desert.''

7. ``1994 Air Quality Management Plan for South Coast Air Basin,

Antelope Valley and Coachella/San Jacinto Planning Area.'' On December

29, 1994, the State submitted the ``Rate of-Progress Plan Revision:

South Coast Air Basin & Antelope Valley & Coachella/San Jacinto

Planning Area.'' 17

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

\17\ Antelope Valley and Coachella-San Jacinto Planning Area are

portions of the Southeast Desert Modified Air Quality Management

Area which are currently under the jurisdiction of the South Coast

Air Quality Management District. California has recently revised its

air basin classifications, so that Antelope Valley is part of Mojave

Desert Air Basin and the Coachella-San Jacinto Planning Area is part

of Salton Sea Air Basin.

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

8. On March 30, 1995, CARB submitted revised 1990 base year

emission inventories for each of the California ozone nonattainment

areas.

9. On June 30, 1995, CARB submitted desriptive materials relating

to the State's motor vehicle inspection and maintenance program,

adopted by the California Bureau of Automotive Repair. On January 22,

1996, CARB submitted the motor vehicle inspection and maintenance

regulations adopted by the California Bureau of Automotive Repair.

2. SIP Submittals After EPA's Proposal

On April 4, 1996, CARB submitted a revision for the San Joaquin

Valley, withdrawing an obsolete transportation control measure

(Exclusive High Occupancy Vehicle Lanes on Freeway 41, included in the

1982 Air Quality Management Plan for Fresno).

On May 17, 1996, CARB submitted Executive Order G-96-031, the

State's commitment to participate in the public consultative process,

submit a revised attainment demonstration for the South Coast as

appropriate after the consultative process, and submit control measures

needed to achieve emission reductions determined to be appropriate.

On June 13, 1996, CARB submitted supplemental information regarding

the 1994 California SIP, including

[[Page 1160]]

additional information on emission reductions from the State's measures

(Letter from James D. Boyd to David Howekamp, with Attachments A, B,

and C).

On July 10, 1996, CARB submitted updates to the South Coast rule

adoption schedule (``Control Measure Adoption Schedule'').

On July 12, 1996, CARB submitted updates to the Ventura AQMP

(``Ventura County 1995 Air Quality Management Plan Revision'' and

``Appendix E-95'') and an updated post-96 ROP for San Joaquin Valley

(``Revised Post-1996 Rate-of-Progress Plan'').

3. EPA Completeness Findings

On January 30, 1995, EPA issued a finding of completeness under

Section 110(k)(1) of the Act for the following portions of the

California ozone SIP submittal: Diesel Fuel Regulations; Reformulated

Gasoline Regulations; CARB Measures M2, M3, M5, M8, M9, M11, CP-2, CP-

3, CP-4, Additional Measures; and SCAQMD Long Term Measures ADV-CTS-01/

02, ADV-FUG, ADV-PRC, ADV-UNSP. These elements of the revision were

found complete based on EPA's completeness criteria that are set forth

in 40 CFR Part 51 Appendix V.18

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

\18\ 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).

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

On April 18, 1995 the EPA issued a finding of completeness for the

remaining portions of the November and December 1994 submittals with

regard to: (1) attainment and post-1996 RFP requirements at section

182(c)(2) of the Act; (2) 15% ROP requirement of section 182(b)(1)(A);

and (3) 1990 base year inventory requirements of section 182(a)(1). The

CARB emission inventory submittal of March 30, 1995, was included in

the completeness determination of April 18, 1995.

On June 30, 1995, and February 5, 1996, EPA issued a finding of

completeness for the State's I/M program submittals.

On August 14, 1996, EPA issued a finding of completeness for

updates to the San Joaquin Valley plan (submitted on April 4, 1996, and

July 12, 1996); the South Coast plan (submitted on July 10, 1996); the

Ventura plan (submitted on July 12, 1996); the State's commitment to

participate in the public consultative process and revise the South

Coast plan as appropriate (submitted on May 17, 1996); and technical

information on State and local measures (submitted on June 13, 1996).

4. Rationale for EPA Approval of Minor SIP Changes without Further

Opportunity for Public Comment

The NPRM indicated that EPA intended to approve in the final action

SIP updates if received before the Notice of Final Rulemaking (NFRM)

was signed. The State, local agencies, and other commenters requested

EPA to absorb these updates and corrections into the final plan action.

In the NFRM, EPA has also made numerous changes to the tables of

control measures, in response to State and local agency requests for

correction and clarification. These changes make minor adjustments to

the measures, the arrangement of the measures in the table, the

schedule of measure adoption and implementation, or the emission

reductions associated with the measures. Since the changes are

administrative or clerical in nature, or otherwise are not significant,

and neither individually nor cumulatively affect ROP or attainment, EPA

has incorporated the changes in this action without further opportunity

for public comment.19 Notice and comment are not required under

the Administrative Procedures Act, ``when the agency for good cause

finds (and incorporates the finding and a brief statement of reasons

therefor in the rules issued) that notice and public procedure thereon

are impracticable, unnecessary, or contrary to the public interest.'' 5

U.S.C. 553(b).

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

\19\ The State's 15% ROP plans for each area do not rely on

reductions from any of the measures (all reductions come from fully

adopted regulations), and the changes do not reduce the amount of

emission reductions from the measures in post-1996 ROP milestone

years or the attainment years.

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

The State and involved local agencies in the San Joaquin Valley,

South Coast, and Ventura all requested that the final notice clarify

the original intent of the 1994 SIP submittal that, coincident with

approving the new Transportation Control Measures (TCMs) in the current

SIP, EPA would delete from the applicable SIP the prior TCMs, which are

out-dated and not relied upon in the new ROP and attainment

demonstrations. Because these rescissions were mistakenly omitted

either from the original submittals or EPA's proposed action on the

submittals, and because the rescissions are inconsequential and fully

consistent with the 1994 SIP submittal respecting progress and

attainment, EPA is finalizing the TCM replacement without further

opportunity for public comment.

II. Review of the State Submittal, Response to Comments on Specific SIP

Issues, and EPA Final Action

A. State Measures

1. General Comments

The California Environmental Protection Agency (CEPA) commented

that EPA's proposal to approve the State's measures on a statewide

basis (if, under State law, they apply throughout California) did not

reflect the intent of the State, which was to limit the Federally

enforceable State measures only to the serious, severe, and extreme

nonattainment areas. EPA is so limiting the final approval action.

Accordingly, under Federal law the statewide measures will not count

toward attainment and maintenance of the NAAQS except in the ozone

nonattainment areas classified as serious and above. As a result, the

State must submit a SIP revision if it wishes in the future to extend

the geographic applicability of the measures. Because EPA is accepting

the State's request that Federal approval of the measures in the SIP

apply narrowly to the ozone ROP and attainment needs in serious and

above areas, the State must submit a SIP revision if, at any time in

the future, the emission reductions associated with the measures in

other areas are needed as components of attainment or maintenance SIPs

for other areas.

CEPA also requested that EPA not approve the reductions shown for

State measures M1, M2, M7, and M9 in the South Coast in the year 2007,

because 2007 is not a milestone year for the South Coast. EPA is

complying with the State's request in this final action. The year 2007

reductions in the South Coast may need to be resubmitted by the State

if federally enforceable 2007 reductions from these measures in the

upwind South Coast nonattainment area are needed for the 2007

attainment demonstration in the Southeast Desert.

Finally, CEPA asked that EPA not assign emission reduction credits

from measures M3, M5, M8, and CP-2/CP-3 to San Diego, since the area

did not use them for rate-of-progress or attainment. EPA is deleting

this credit. If reductions from these measures are needed in San Diego

in the future, the CARB must resubmit for SIP approval the State

measures with associated San Diego emission reductions.

2. Mobile Source Measures

a. Review of Measures. The following is a brief description of the

State's mobile source measures, or M Measures, identification of minor

corrections and clarifications to the measures or their

[[Page 1161]]

associated emission reductions, summary of public comment on the

measures and EPA's response, and EPA's final approval actions on the

measures.

(i) M1--Accelerated Retirement of Light-Duty Vehicles. The SIP

commits to secure a financing mechanism by the end of 1995, adopt the

measure in 1996, undertake a demonstration program from 1996 through

1998, and implement the program fully from 1999 to 2010, through the

annual retirement (scrappage or removal) of up to 75,000 older, high-

emitting vehicles in the South Coast Air Basin. CARB has clarified in

recent correspondence that the State's commitments for M-1 and for M-7,

the other vehicle retirement program in the 1994 Ozone SIP, are for the

specified emission reductions, rather than a particular number of

vehicles to be retired.20 While M1 is a commitment to implement an

accelerated vehicle retirement program only in the South Coast, the SIP

states that ``implementation of light-duty vehicle retirement programs

in other non-attainment areas will be considered as a means of further

reducing emissions'' (Vol. II, p. B-2).

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

\20\ Letter from Lynn Terry to Julia Barrow, dated September 20,

1996.

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

The Environmental Defense Center commented that M1 is illusory

until an adequate and enforceable funding source is identified. EPA

considers the State's progress in implementing the measure to be

acceptable at this time. During 1995, the California Legislature

enacted SB501, which established a statewide scrappage program to work

in concert with the scrap component of the I/M program. Current funding

comes from legislation authorizing fees in lieu of smog check at first

registration renewal. EPA believes that timely program implementation

requires the State to develop an adequate long-term funding approach by

the end of 1997.

EPA will continue to monitor M1. If the program does not mature on

a schedule likely to deliver the reductions needed for progress and

attainment, EPA will work with the State to correct implementation or

substitute other measures that provide the needed emission reductions.

Under sections 110(k)(3) and 301(a) of the Act, EPA is taking final

action to approve M1, its implementation schedule, and the emission

reductions to be achieved in the South Coast, as displayed in the table

below, labeled ``Reductions from California Mobile Source Measure M1.''

Reductions From California Mobile Source Measure M1 South Coast Air

Basin

[Tons per day]

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

1999 2002 2005 2008 2010

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

ROG.................................. 5 8 11 13 14

NOX.................................. 4 6 9 10 11

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

(ii) M2--Improved Control Technology for Light-Duty Vehicles. CARB

commits to adopt this measure in 2000 and begin implementation in 2004-

2005. This measure will achieve emission reductions from LDVs through

the use of one or more market-based and/or technology-forcing

approaches. Emission reductions associated with this measure are relied

upon in the South Coast only.

The Western States Petroleum Association commented that the

description of the measure in the NPRM appeared to limit the

flexibility of the State. EPA's description, which was excerpted from

the SIP, was not intended to prescribe the ways in which the measure

could be implemented.

The Environmental Defense Center (EDC) noted that M2 relies on the

ZEV program, which was recently revised to rescind the interim

milestones. EDC also commented that M2 is highly speculative and

unenforceable and inappropriate for SIP credit.

On August 21, 1995, EPA approved M2 and assigned it SIP credit in

the South Coast under the provisions of section 182(e)(5) of the Act.

EPA will continue to work with CARB to ensure that the measure is

developed on schedule. CARB has recently provided additional

information regarding the development of this measure in a letter from

Lynn Terry to Julia Barrow, dated September 19, 1996: ``We expect to

begin developing this advanced technology measure following the 1998

biennial report to the ARB on the Low-Emission Vehicle Program. To meet

our commitment for adoption in 2000, we would need to hold public

workshops on the technical basis and regulatory concepts by 1999.

However, as part of the on-going Low-Emission Vehicle Program review,

staff continue to evaluate advanced control technologies that may

contribute to post-2003 emission reduction strategies for this

measure.'' The State has indicated that compliance options include

advanced gasoline vehicles, alternative fueled vehicles, and fuel cell

technologies.

Under sections 110(k)(3) and 301(a) of the Act, EPA is taking final

action to approve the emission reductions to be achieved in the South

Coast by milestone year in the table below, labeled ``Reductions from

California Mobile Source Measure M2.''

Reductions From California Mobile Source Measure M2 South Coast Air

Basin

[Tons per day]

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

1999 2002 2005 2008 2010

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

ROG.................................. 0 0 3 6 10

NOX.................................. 0 0 5 9 15

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

(iii) M3--Accelerated Ultra-Low Emission Vehicle (ULEV) Requirement

for Medium-Duty Vehicles (MDVs). CARB commits in the SIP to adopt

regulations for this measure in 1997, with implementation occurring

from 1998 to 2002. This measure commits to an increase in the fraction

of MDV ULEVs from 10 percent of sales of new MDVs in the 1998 model

year to 100 percent in the 2002 and later model years. This measure

offers some flexibility by allowing other mixes of vehicles and

technologies that generate equivalent emission reductions.

In their joint comments, the Natural Resources Defense Council and

the Coalition for Clean Air noted that, at a public hearing in

September 1995, CARB announced that it had made a calculation error

which resulted in an overallocation of emission reductions to this

measure. As a result, the regulations adopted at that time will achieve

2 tpd VOC and 23.9 tpd NOX reduction, compared to M3's claimed

credits of approximately 4 tpd VOC and 32 tpd NOX in the South

Coast in 2010. The environmental groups stated that EPA must require

CARB to submit an additional measure to make up this shortfall before

EPA can approve the SIP. Despite CARB's error, EPA expects and requires

CARB to adhere to the State's enforceable commitment to adopt by 1997

regulations that achieve the full credit assigned to M3 for the

milestone dates specified for each of the 5 areas where reductions are

claimed.\21\

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\21\ The State has clarified its intentions in this regard

(letter from Lynn Terry to Julia Barrow, dated September 19, 1996):

``The SIP binds the State to develop enforceable measures that

deliver the emission reductions needed for rate-of-progress and

attainment, as identified in the plan and subsequent technical

transmittals. Volume I of the SIP says `* * * Once the SIP is

approved by U.S. EPA, these enforceable commitments become mandatory

and must be carried out * * *. [they] compel the State or local air

districts to obtain the reductions or to substitute alternative

measures by formal revision of the SIP.' Thus, if we discover that a

rule to implement a plan measure will not generate the targeted

emission reductions, we are obliged to find replacement reductions

or to demonstrate that rate-of-progress and attainment requirements

will still be met. Further, we recognize that any shortfall in

emission reductions would have to be made up on an expedited basis

because of the need for those reductions in the South Coast and

other areas for rate-of-progress and attainment. ARB will be looking

at any feasible alternatives proposed during the process of

developing each measure into a regulation. This process includes

several rounds of public review and a thorough consideration of the

economic impacts on the affected industries.''

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

[[Page 1162]]

EPA approved M3 on December 14, 1995 (60 FR 64126). Under sections

110(k)(3) and 301(a) of the Act, EPA here takes final action to approve

the emission reductions associated with the measure, as displayed by

nonattainment area and milestone/attainment year in the table below,

labeled ``Reductions from California Mobile Source Measure M3.''

Reductions From California Mobile Source Measure M3

[Tons per day]

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

1999 2002 2005 2008 2010

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

ROG NOX ROG NOX ROG NOX ROG NOX ROG NOX

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

So. Coast....................... 0 .89 .78 9.51 1.85 21.1 2.31 26.7 3.37 33.16

SE Desert....................... 0 .1 .1 1.4 .2 3.5 ...... ...... ...... ......

Ventura......................... 0 0 0 .5 .1 1.0 ...... ...... ...... ......

Sacramento...................... .2 .2 0 1.7 .4 3.9 ...... ...... ...... ......

S. Joaquin...................... 0 .4 ...... ...... ...... ...... ...... ...... ...... ......

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

(iv) M4--Heavy-Duty Diesel Vehicles (HDDV); Early Introduction of

2.0 g/bhp-hr NOX engines. The SIP commits to implementation of

this measure beginning in 1996. CARB and the Districts share

responsibility for this measure. M4 is a commitment to increase the use

of existing low-emission engines among on-road HDDVs through locally

implemented demand-side programs and market incentives. This program is

intended to result in a 5% sales penetration of 2.0 g/bhp-hr NOX

engines through the period 1996-1999, and a 10% sales penetration of

these engines between 2000 and 2002. Other combinations of penetrations

and emission levels that provide equivalent emission reductions could

be implemented.

CEPA commented that the NPRM omits SIP credits for this measure

outside of the South Coast. EPA agrees to include the State's M4

reductions for the remaining State areas. The credits for these areas

are taken from tables provided by CARB in Attachment C to a June 13,

1996 letter from James D. Boyd to David Howekamp.

EPA approved M4 on December 14, 1995 (60 FR 64126). Under sections

110(k)(3) and 301(a) of the Act, EPA here takes final action to approve

the emission reductions associated with the measure, as displayed by

nonattainment area and milestone/attainment year in the table below,

labeled ``Reductions from California Mobile Source Measure M4.''

Reductions From California Mobile Source Measure M4

[Tons per day of NOX]

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

1999 2002 2005 2007 2008 2010

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

So. Coast......................... 2.17 3.90 2.93 ........... 2.34 1.36

SE Desert......................... 0.31 0.57 0.39 0.35 ........... ...........

Ventura........................... 0.1 0.18 0.14 ........... ........... ...........

Sacramento........................ 0.28 0.49 0.36

S. Joaquin........................ 0.74 ........... ........... ........... ........... ...........

Kern.............................. 0.04 ........... ........... ........... ........... ...........

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

(v) M5--Heavy-Duty Diesel Vehicles (HDDVs); Additional NOX

Reductions. The SIP commits to adopt this measure in 1997 and begin

implementation in 2002. CARB commits to achieve emission reductions

through adoption of a 2.0 g/bhp-hr NOX emissions standard for new

HDDV engines sold in California beginning in 2002, or by implementation

of alternative measures which achieve equivalent or greater reductions.

This measure is designed to achieve emission reductions prior to

the introduction of a national HDDV standard in 2004. The 1994

California Ozone SIP (``Federal Measure'' M6) assigns to EPA

responsibility for adopting such a national standard. See discussion in

the NPRM (61 FR 10928-9). Since EPA's proposal, further progress toward

fulfilling the M5 and M6 commitments has been made by CARB and EPA. On

June 27, 1996 (61 FR 33421-33469), EPA published an NPRM proposing a

national onroad heavy-duty engine standard giving manufacturers the

flexibility to choose between two options: (1) A combined non-methane

hydrocarbon (NMHC) plus NOX standard of 2.4 g/bhp-hr and (2) a

combined NMHC plus NOX standard of 2.5 g/bhp-hr together with a

NMHC cap of .5 g/bhp-hr. EPA and CARB expect that the combined standard

will result in NOX reductions comparable to those achieved with a

2.0 g/bhp-hr standard.

EPA approved M5 on December 14, 1995 (60 FR 64126). Under sections

110(k)(3) and 301(a) of the Act, EPA here takes final action to approve

the emission reductions associated with the measure, as displayed by

nonattainment area and milestone/attainment year in the table below,

labeled ``Reductions from California Mobile Source Measure M5.'' Future

SIP updates may need to redistribute the emissions assigned to the

State (M5) and Federal (M6) measures.

[[Page 1163]]

Reductions From California Mobile Source Measure M5

[Tons per day]

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

1999 2002 2005 2007 2008 2010

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

ROG NOX ROG NOX ROG NOX ROG NOX ROG NOX ROG NOX

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

So. Coast............................................... 0 0 0.2 1.7 1.8 22.0 ...... ...... 3.1 37.6 4.8 56.2

SE Desert............................................... 0 0 0 0.2 0.2 3.9 0.4 5.1 ...... ...... ...... ......

Ventura................................................. 0 0 0 0.1 0.1 1.0 ...... ...... ...... ...... ...... ......

Sacramento.............................................. 0 0 0 0.2 0.2 2.7 ...... ...... ...... ...... ...... ......

S. Joaquin.............................................. 0 0 ...... ...... ...... ...... ...... ...... ...... ...... ...... ......

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

(vi) M7--Accelerated Retirement of Heavy-Duty Vehicles. CARB

commits to adopt this measure in 1996 and begin implementation in the

same year. This measure involves the annual retirement (scrapping or

removal) of about 1600 of the oldest, high emitting trucks in the South

Coast Air Basin, beginning in 1999. A smaller number of trucks would be

scrapped in 1996 to 1998 in order to gain experience with the program

and determine the impacts on the used truck market. The SIP commits to

secure a financing mechanism for this measure by the end of 1995. While

the SIP commits only to implement this measure in the South Coast, the

State indicates that consideration is being given to establishing a

truck retirement program in Sacramento and other nonattainment areas.

The Environmental Defense Center notes that M7 relies on an

enforceable funding mechanism to be secured by the end of 1995. EDC

comments that it is capricious to fail to identify the secure,

enforceable funding source for this speculative scrappage program.

State funding legislation has been prepared to establish the

Accelerated Vehicle Replacement Program, and the State is continuing to

pursue viable funding options. EPA will monitor program implementation

and ensure that the State and involved parties meet the SIP's schedule

for program adoption and implementation in 1996.

CARB requested that the ROG emission reductions shown for the South

Coast in the year 2002 be reduced from 1 to zero (0.21). EPA is doing

so at this time.

Under sections 110(k)(3) and 301(a) of the Act, EPA is taking final

action to approve M7, its implementation schedule, and the emission

reductions to be achieved in the South Coast, as displayed in the table

below, labeled ``Reductions from California Mobile Source Measure M7.''

Reductions From California Mobile Source Measure M7--South Coast Air Basin

[Tons per day]

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

1999 2002 2005 2007 2008 2010

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

ROG............................... 0 0 1 1 1 1

NOX............................... 3 6 7 8 9 10

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

(vii) M8--Heavy-Duty Gasoline Vehicles (HDGVs), Lower Emission

Standards. The SIP commits to adoption of this measure by 1997 and

implementation beginning in 1998. This measure generates emission

reductions through the adoption of a LEV/ULEV program for HDGV engines

to obtain 50% reductions of NOX and ROG emissions through the

application of 3-way catalyst technology.

EPA approved M8 on December 14, 1995 (60 FR 64126). Under sections

110(k)(3) and 301(a) of the Act, EPA here takes final action to approve

the emission reductions associated with the measure, as displayed by

nonattainment area and milestone/attainment year in the table below,

labeled ``Reductions from California Mobile Source Measure M8.''

Reductions From California Mobile Source Measure M8

[Tons per day]

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

1999 2002 2005 2007 2008 2010

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

ROG NOX ROG NOX ROG NOX ROG NOX ROG NOX ROG NOX

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

So. Coast............................................... 0 0 0 0.8 0.1 1.8 ...... ...... 0.2 2.3 0.3 3.0

SE Desert............................................... 0 0 0 0.1 0 0.3 0 0.4 ...... ...... ...... ......

Ventura................................................. 0 0 0 0 0 0.1 ...... ...... ...... ...... ...... ......

Sacramento.............................................. 0 0 0 0.2 0 0.4 ...... ...... ...... ...... ...... ......

S. Joaquin.............................................. 0 0 ...... ...... ...... ...... ...... ...... ...... ...... ...... ......

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

(viii) M9--Off-road Diesel Equipment; 2.5 g/bhp-hr NOX

Standard, California. CARB commits to adopt this measure in 2001 and

begin implementation in 2005. The measure requires CARB to adopt a 2.5

g/bhp-hr NOX standard effective in the 2005 model year for new

off-road industrial equipment diesel engines that are not preempted

from California authority. California is preempted from adopting or

enforcing any standard or other requirement relating to the control of

emissions from new construction and farm equipment or vehicles which

are smaller than 175 hp (see section 209(e) of the Act).

CARB requested that the ROG emission reductions shown for the South

Coast in the year 2005 be increased from zero to 0.5. EPA is doing so

at this time.

On August 21, 1995, EPA approved M9 and assigned it SIP credit in

the South Coast under the provisions of section 182(e)(5) of the Act.

Under sections 110(k)(3) and 301(a) of the Act, EPA is taking final

action to approve

[[Page 1164]]

the emission reductions to be achieved in the South Coast by milestone

year in the table below, labeled ``Reductions from California Mobile

Source Measure M9.''

Reductions From California Mobile Source Measure M9--South Coast Air Basin

[tons per day]

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

1999 2002 2005 2007 2008 2010

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

ROG............................... 0 0 0.5 4 1 3

NOX............................... 0 0 4 35 14 34

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

(ix) M11--Industrial Equipment; Gas and LPG-California; 3-way

catalyst technology. CARB commits to adopt this measure in 1997 and

implement it beginning in 2000. The measure requires CARB to adopt

emission standards for new gas and liquid petroleum gas (LPG) engines

25 to 175 horsepower that are not primarily used in construction or

farm equipment. As noted above, California is preempted from regulating

new farm and construction equipment smaller than 175 hp. The standards

will be phased-in beginning in 2000, and are intended to reduce ROG

emissions by 75% and NOx by at least 50%.

CEPA commented that the NPRM omits SIP credits for this measure in

Ventura, Sacramento, and the Southeast Desert. EPA agrees to include

the State's M11 reductions for these areas. The credits for these areas

are taken from tables provided by CARB in Attachment C to a June 13,

1996 letter from James D. Boyd to David Howekamp. Since the reductions

in these areas are all considerably less than one ton per day and EPA's

proposal showed credits only for whole number reductions in the South

Coast, EPA is also amending the reductions for the South Coast by

showing estimated reductions to the nearest tenth of a ton.

EPA approved M11 on December 14, 1995 (60 FR 64126). Under sections

110(k)(3) and 301(a) of the Act, EPA here takes final action to approve

the emission reductions associated with the measure by milestone/

attainment year for each area in the table below, labeled ``Reductions

from California Mobile Source Measure M11.''

Reductions From California Mobile Source Measure M11

[Tons per day]

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

1999 2002 2005 2007 2008 2010

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

ROG NOX ROG NOX ROG NOX ROG NOX ROG NOX ROG NOX

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

So. Coast............................................... 0 0 4.2 2.0 8.8 4.4 ...... ...... 15.1 7.7 23.0 11.6

SE Desert............................................... 0 0 0.1 0 0.2 0.1 0.2 0.1

Ventura................................................. 0 0 0.1 0 0.1 0.1 ...... ...... ...... ...... ...... ......

Sacramento.............................................. 0 0 0.1 0.1 0.2 0.1 ...... ...... ...... ...... ...... ......

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

(x) Additional New Control Technologies. In addition to the new

control technologies described above in measures M2 and M9, CARB has

committed to the implementation of additional innovative measures to

achieve the emission reductions needed in the South Coast to reach

attainment by 2010. CARB anticipates that these additional measures

will include a combination of market-based and technology-based

measures. CARB has committed to adoption of these measures no later

than 2006 to ensure the needed emissions reductions (55 tpd of ROG and

20 tpd of NOX) are achieved by 2009.

The Environmental Defense Center commented that these new-

technology measures jeopardize the efficacy of the entire SIP. EDC

stated that many of the State's example controls are unrealistic (speed

controls) or illegal (episodic controls).

On August 21, 1995, EPA approved CARB's additional new control

technologies measure under the provisions of section 182(e)(5), with

2010 emission reduction credits of 79 tpd ROG and 60 tpd NOX in

the South Coast. CARB has subsequently clarified that the emissions

reductions associated with this measure are 55 tpd ROG and 20 tpd

NOX.

CARB has also furnished additional information regarding the

State's approach to developing the control measure. A September 19,

1996 letter from Lynn Terry to Julia Barrow provides the following

description of the State's proposed schedule: ``We anticipate kicking

off development of this measure in 1997 with an international symposium

on clean transportation to solicit ideas for new technologies and

approaches. We intend to follow up with technical work (including any

appropriate research contracts), meetings, and workshops on the most

promising ideas through 2000. At that point, we expect to develop

regulatory concepts for discussion in 2001-2003, followed by release of

specific proposals in 2004-2005, and adoption of appropriate

regulations by 2006.'' EPA remains eager to work with the State to

ensure that progress is made to develop approvable mobile source

controls as necessary in the South Coast to meet the SIP's progress and

attainment goals.

c. EPA Action. As described above, EPA has already approved most of

the State's M Measure commitments. On August 21, 1995, EPA approved the

CARB new-technology measures M2, M9, and Additional New Technology

Mobile Source Measures (described above), and assigned credit in the

South Coast ozone attainment demonstration to the measures. At the same

time, EPA proposed approval of the State's control measure commitments

for M3, M5, M8, and M11. EPA issued final approval of the measures on

December 14, 1995 (60 FR 64126). Because EPA was at that time not

acting on the State's ROP and attainment demonstrations, EPA's approval

of the State's commitments did not include assignment of specific

emission reduction credits associated with the measures. EPA is here

approving the ROP and attainment demonstrations of California ozone

nonattainment area plans which rely, in part, on the M Measure

commitments. Therefore, under sections 110(k)(3) and

[[Page 1165]]

301(a) of the Act, EPA now takes final action to assign credit to the

State's enforceable commitments to achieve the specific emission

reductions associated with M3, M5, M8, and M11, and displayed in the

tables above for each measure.

EPA is also approving, under sections 110(a)(3) and 301(a) of the

Act, and assigning credit to measures M1, M4, and M7 as part of the ROP

and attainment demonstrations for appropriate nonattainment areas, as

shown in the tables above. EPA believes that CARB is making significant

progress toward the development and adoption of regulations to fulfill

the M measure commitments. EPA therefore takes final action to approve

and credit CARB's enforceable commitments to these M measures under

sections 110(k)(3) and 301(a) of the Act, as part of the demonstrations

of ROP and attainment in the California ozone nonattainment areas.

2. I/M

a. Review of Program. CARB initially submitted its motor vehicle

inspection and maintenance (I/M) program, known as the Smog Check

program, as a revision to its SIP on June 30, 1995. The submittal was

made to fulfill EPA's requirements for basic and enhanced I/M programs

as set forth in 40 CFR Part 51, Subpart S. EPA found the submittal

complete on June 30, 1995. A revised and final revision was submitted

by the State on January 22, 1996 and found complete on February 5,

1996. Section 348 of the National Highway System Designation Act

(Public Law 104-59), hereafter referred to as the Highway Act, which

was enacted on November 28, 1995, modified EPA's I/M regulation. In

this notice EPA is finalizing approval of California's basic program as

meeting the requirements of 40 CFR, Part 51, Subpart S as amended (see

60 FR 48029, September 18, 1995) and approval of California's enhanced

I/M program as meeting the high enhanced performance standard

requirements of 40 CFR Part 51, Subpart S, as amended and section

348(c) of the Highway Act.

The table labeled ``California I/M Program Coverage by County''

shows for every county in the State whether the I/M program is

implemented as enhanced or basic, or is required only upon change of

ownership. For many counties, the type of I/M program in effect varies

depending upon air quality designations and whether the area is

urbanized. The State has established these I/M program boundaries

within counties based upon ZIP code. The reader may contact the Bureau

of Automotive Repair (BAR) to obtain specific program applicability

information by ZIP code.

California I/M Program Coverage by County

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

Change of

County Enhanced Basic ownership

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

Alameda....................... ............ x ............

Alpine........................ ............ ............ x

Amador........................ ............ ............ x

Butte......................... ............ x ............

Calaveras..................... ............ ............ x

Colusa........................ ............ x ............

Contra Costa.................. ............ x ............

Del Norte..................... ............ ............ x

El Dorado..................... ............ x x

Fresno........................ x x ............

Glenn......................... ............ x ............

Humboldt...................... ............ ............ x

Imperial...................... ............ ............ x

Inyo.......................... ............ ............ x

Kern.......................... x x ............

Kings......................... ............ x ............

Lake.......................... ............ ............ x

Lassen........................ ............ ............ x

Los Angeles................... x ............ ............

Madera........................ ............ x ............

Marin......................... ............ x ............

Mariposa...................... ............ ............ x

Mendocino..................... ............ ............ x

Merced........................ ............ x ............

Modoc......................... ............ ............ x

Mono.......................... ............ ............ x

Monterey...................... ............ x ............

Napa.......................... ............ x ............

Nevada........................ ............ x ............

Orange........................ x ............ ............

Placer........................ x x x

Plumas........................ ............ ............ x

Riverside..................... x x x

Sacramento.................... x x ............

San Benito.................... ............ x ............

San Bernardino................ x x x

San Diego..................... x x x

San Francisco................. ............ x ............

San Joaquin................... x x ............

San Luis Obispo............... ............ x ............

San Mateo..................... ............ x ............

Santa Barbara................. ............ x ............

Santa Clara................... ............ x ............

Santa Cruz.................... ............ x ............

[[Page 1166]]

Shasta........................ ............ x ............

Sierra........................ ............ ............ x

Siskiyou...................... ............ ............ x

Solano........................ x x ............

Sonoma........................ ............ x x

Stanislaus.................... x x ............

Sutter........................ ............ x ............

Tehama........................ ............ x ............

Trinity....................... ............ ............ x

Tulare........................ ............ x ............

Tuolumne...................... ............ ............ x

Ventura....................... x x ............

Yolo.......................... x x ............

Yuba.......................... ............ x ............

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

The SIP revision submitted to EPA by CARB includes the Laws and

Regulations relating to California's I/M program which comprises

pertinent sections of the California Business and Professions Code, the

Health and Safety Code, the Vehicle Code, and the California Code of

Regulations. Included in the supplemental submittal are final

regulations for the mandatory exhaust emissions inspection standards

and test procedures for the enhanced program and for the licensing of

I/M stations and technicians which became legally effective on December

1, 1995 and December 5, 1995, respectively. Other documents in the

submittal are: The Request for Conceptual Design for Test-only Networks

and Referee Services; the BAR-90 Test Analyzer System Specifications

(June 1995); the California Smog Check Inspection Manual; the Quality

Assurance Operations Manual, Chapter 27 of the Department of Motor

Vehicles Manual of Registration Procedures; the Smog Check Diagnostic

and Repair Manual; the Request for Proposal for On-Road Emissions

Measurement Systems Services, and the Radian Report entitled

``Evaluation of the California Pilot Inspection/Maintenance (I/M)

Program.''

EPA's I/M regulation establishes minimum performance standards for

basic and enhanced I/M programs as well as requirements for the

following: Network type and program evaluation; adequate tools and

resources; test frequency and convenience; vehicle coverage; test

procedures and standards; test equipment; quality control; waivers and

compliance via diagnostic inspection; motorist compliance enforcement

program oversight; quality assurance; enforcement against contractors,

stations and inspectors; data collection; data analysis and reporting;

inspector training and licensing or certification; public information

and consumer protection; improving repair effectiveness; compliance

with recall notices; on-road testing; SIP revisions; and implementation

deadlines. The performance standard for basic I/M programs remains the

same as it has been since initial I/M policy was established in 1978,

pursuant to the 1977 amendments to the Clean Air Act. The high

performance standard for enhanced I/M programs is based on high-

technology loaded mode exhaust testing for HC, CO, and NOX and

testing of the integrity and performance of the evaporative control

system.

California's basic program is a test-and-repair program utilizing

two-speed idle testing. California's enhanced program is a hybrid

program in which 15% of the dirtiest vehicles, based upon high-emitter

profile and remote sensing results as well as other factors, are

targeted for test-only inspection. All vehicles in the enhanced areas

will be subject to loaded mode testing. More stringent requirements

apply to technicians licensed in the enhanced areas. The two programs

are essentially the same in all other respects, excepting that

frequency of enforcement related activities such as remote sensing will

be much greater in the enhanced areas. (A more detailed discussion of

how the elements of California's I/M programs address the requirements

of EPA's I/M regulations is contained in the TSD for the NPRM.) The SIP

submittal includes modeling which demonstrates that the program design

for California's basic program will meet EPA's performance standard for

basic programs. EPA is, therefore, approving this revision to

California's SIP for the basic I/M program.

The Highway Act prohibits the Administrator from disapproving or

applying an automatic discount of emission reduction credits to a SIP

revision because the I/M program is decentralized or a test-and-repair

program. The Highway Act directs the Administrator to propose approval

of the program for the full credit proposed by the state if the

proposed credits reflect good faith estimates by the state and the

revision is otherwise in compliance with the Clean Air Act. The

approval remains effective for up to 18 months after the date of final

rulemaking. After the 18-month period, permanent approval of the SIP

revision based on the credits proposed by the state shall be granted if

the data collected on the operation of the program demonstrates that

the credits are appropriate and the program is otherwise in compliance

with the Act.

EPA issued guidance regarding approval of I/M plans under the

Highway Act on December 12, 1995. The Highway Act is clear that

approval under its provisions shall last for only 18 months, and that

the program evaluation is due to EPA at the end of that period.

Therefore, EPA believes Congress intended for these programs to start-

up as soon as possible, which EPA believes should be at the latest, 12

months after the effective date of the approval, so that at least 6

months of operational program data can be collected to evaluate the

performance of the program. ``Start-up'' is defined as a fully

operational program which has begun regular, mandatory inspections and

repairs, using the final test strategy and covering each of the state's

required areas. If the state fails to start its program on this

schedule, the approval granted under the provisions of the Highway Act

will convert to a disapproval after a finding letter is sent to the

state.

As mentioned above, the Highway Act specifies that EPA grant

approval if good faith estimates of credits are made.

[[Page 1167]]

The Conference Report states that good faith estimates may be based on

previous I/M program performance, remote sensing programs, or other

evidence relevant to effectiveness of I/M programs. EPA has further

suggested that good faith estimates could be based on innovative

program designs.

The program evaluation to be used by the state during the 18-month

period must be acceptable to EPA. EPA anticipates that such a program

evaluation process will be developed by the Environmental Council of

State (ECOS) group that is convening now and that was organized for

this purpose. California is an active participant in the ECOS group.

EPA further expects that in addition to the interim, short term

evaluation to be conducted within 18 months, the state will conduct a

long term, ongoing evaluation of its I/M program as required by the I/M

Rule in sections 51.353 and 51.366.

At the end of the 18-month approval period, EPA will review the

state's final I/M SIP revision, which will include the state's program

evaluation, and take action to make the approval of the I/M program

permanent, if the program evaluation data collected by the state

demonstrates that the I/M program is achieving the emission reduction

credits claimed in the SIP.

According to the schedule submitted by California test-only

inspection began in Sacramento in August 1995. The program is expected

to be fully operational in Fresno, Bakersfield and San Diego by the

fall of 1996, and in the South Coast areas in early 1997. Although this

schedule appears to be slipping, EPA anticipates that California will

start its program within 12 months of this approval.

California has made a good faith estimate that its hybrid enhanced

I/M program will meet EPA's high performance standard based on the

California Pilot Program and innovative program features including an

electronic transmission project with a trigger program used for

enforcement, a high visibility remote sensing program, and stringent

licensing and training requirements.

The pilot program conducted as part of the Memorandum of Agreement

between EPA and California provided data on the effectiveness of

targeting high emitting vehicles through the use of the high-emitter

profile (HEP) and remote sensing combined with the HEP, and the use of

Acceleration Simulation Mode (ASM) testing. The vehicles required to go

to test-only facilities for inspection will comprise likely high-

emitters as identified through use of the HEP and remote sensing,

previously identified high emitters which must undergo annual testing

for 2 to 5 years, high emitters identified by test-and-repair stations,

high mileage fleet vehicles, vehicles for hire, a 2% random sample, and

motorists voluntarily choosing to go to test-only stations.

California's program includes an electronic transmission program. A

central Vehicle Information Database has been created and an electronic

network enabling the test analyzer system units to connect

automatically to the database has been established. The central

database will be able to restrict the issuance of certificates under

certain circumstances, e.g., if a test-only inspection is required,

when the vehicle is identified as a high emitter, or when an enhanced

test is required. The database will also furnish a real-time

communications link to vehicle emissions data which will provide

information to BAR enforcement teams to help immediately identify

illicit activity. The database will also be used to develop a trigger

program to identify shops that are performing improper inspections and

to track the location and performance of licensed smog check

technicians.

The State is also phasing in a high-visibility remote sensing

program. California plans to identify as least 200,000 high emitting

vehicles annually in the enhanced program areas. Data collected from

the program will be used as a target parameter for the enforcement

program. The program will also serve as a visible reminder to both

motorists and test-and-repair stations that improper inspections and/or

program avoidance may be detected. Stringent licensing and training

requirements are being required for test-and-repair stations and repair

technicians, respectively.

California has committed to performing quarterly evaluations of its

program to determine if EPA's performance standard is being met and the

credits taken for the program are being achieved. California plans to

adjust the number of vehicles sent to test-only stations based on these

evaluations.

b. Response to Comments. The Environmental Defense Center commented

that the State's I/M program must be bolstered to return the emissions

reduction necessary to meet attainment. California has committed to

performing quarterly program evaluations to determine whether SIP

emission reduction requirements and EPA's performance standard are

being met. EPA's approval under section 348(c) of the Highway Act

requires the State to collect data on the operation of the program to

demonstrate with an 18 month period that the I/M credits are valid and

the program is otherwise in compliance with the CAA. EPA will work with

the State to help ensure that data are timely collected and that the

program delivers SIP-required reductions or is promptly modified to do

so.

c. Emissions Reductions. The emission reductions to be achieved by

the measure are displayed by nonattainment area and milestone/

attainment year in the table below, labeled ``Reductions from

California Enhanced I/M Program.'' The table reflects the revisions to

the estimated reductions shown in the NPRM. These changes were

requested by CARB in Attachment A to a letter dated June 13, 1996

(James D. Boyd to David Howekamp). South Coast 2002 NOX is changed

from 35.5 to 35.6; Southeast Desert 2005 ROG is changed from 2.9 to

2.6; Southeast Desert 2007 NOX is changed from 2.8 to 2.7;

Sacramento 2005 ROG is changed from 5.1 to 5.2; and San Joaquin Valley

1999 NOX is changed from 4.9 to 5.0. The emission reductions

claimed for the San Joaquin Valley are based on implementation of the

enhanced I/M program in Bakersfield, Fresno, Stockton, and Modesto.

Reductions From California Enhanced I/M Program

[Tons per day]

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

1999 2002 2005 2007 2008 2010

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

ROG NOX ROG NOX ROG NOX ROG NOX ROG NOX ROG NOX

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

So. Coast..................... 34.8 32.4 40.3 35.6 32.5 33.0 ........ ........ 30.2 34.8 26.2 31.1

SE Desert..................... 2.4 2.3 3.0 2.6 2.6 2.8 2.6 2.7

Ventura....................... 1.6 1.9 1.8 2.0 1.4 1.9

[[Page 1168]]

Sacramento.................... 5.4 5.7 6.3 6.5 5.2 6.4

S. Joaquin.................... 4.3 5.0

S. Diego...................... 0 0

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

c. EPA Action. EPA is finalizing approval of the California I/M

regulations submitted on January 22, 1996, under sections 110(k)(3) and

301(a) of the Act as strengthening the SIP and contributing specific

emission reductions toward the progress, attainment, and maintenance

requirements of the Act.

EPA is also finalizing, under sections 110(k)(3) and 301(a) of the

Act, approval of the California I/M program and regulations submitted

on January 22, 1996, as meeting the requirements of section 182(b)(4)

of the Act for basic I/M in applicable areas of the State classified as

moderate for ozone.22 By mistake EPA's proposed approval was

limited to ozone. In this final action EPA is also approving the

California I/M program as meeting the requirements of section 187(a)(4)

of the Act for basic I/M for the following areas of the State

classified as moderate for CO with design values less than 12.7:

Fresno, Sacramento, Modesto, Chico, Stockton and San Diego.

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

\22\ The January 22, 1996 SIP submittal includes and supersedes

materials contained in the State's earlier submittal of June 30,

1995.

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

Under section 348(c) of the Highway Act, EPA is finalizing, for a

period of 18 months, approval of the California I/M submittal of

January 22, 1996, as meeting the requirements of section 182(c)(3) of

the CAA for enhanced I/M in applicable areas of the State classified as

serious and above for ozone. In addition, EPA is approving the I/M

submittals as meeting the requirements of section 187(a)(6) of the Act

for enhanced I/M for the South Coast which is classified as a serious

nonattainment area for carbon monoxide; by mistake, this aspect of

EPA's approval of the I/M program was also omitted from the NPRM.

Finally, EPA is finalizing, for a period of 18 months, approval of the

emission reductions to be achieved by the enhanced I/M program, as

displayed in the table above, labeled ``Reductions from California

Enhanced I/M Program.'' Section 348(c)(3) of the Highway Act provides

that EPA will take regulatory action to make the approval permanent if,

at the expiration of the 18-month period or at an earlier time, the

data collected on the operation of the State program demonstrates that

``the credits are appropriate and the revision is otherwise in

compliance with the Clean Air Act.''

If EPA finds that California has failed to start its program within

12 months from the effective date of this notice, or by February 9,

1998, and issues a letter so informing California, then this approval

will convert to a disapproval as of the date of such letter. If the

required State demonstration is not completed within 18 months and

submitted to EPA as a SIP revision or does not show that the credits

are appropriate and that the program is otherwise in compliance with

the CAA, EPA will take regulatory action to disapprove the program for

purposes of compliance with the enhanced I/M requirements of sections

182(c)(3) and 187(a)(6). After 18 months have elapsed, unless and until

EPA approves a new SIP submittal, the SIP will no longer meet the

specific requirements of the Act relating to enhanced I/M, but the

State's regulations will continue in the SIP as contributing to

progress, attainment, and maintenance of the NAAQS.

3. Consumer Products.

a. Introduction. As discussed in the NPRM, CARB classifies the

emissions reductions resulting from regulations on consumer products

regulations into 3 main categories: near-term, mid-term, and long-term

with regard to date of promulgation and implementation.

CARB's near-term measures consist of rules adopted prior to May

1995. The existing consumer products regulations, antiperspirant and

deodorant regulations, and the 1996 and 1999 VOC content standards of

the recently adopted aerosol paints rule comprise the near-term

measures.

CARB's mid-term measures consist of anticipated regulations from

categories of consumer products for which regulations had not yet been

adopted at the time of the submittal. These regulations are expected to

be adopted by July 1, 1997 and implemented by the year 2005, and will

cover various consumer product categories which are currently not

regulated by the State of California. These mid-term measures are

needed for attainment demonstrations in the Sacramento Metropolitan and

Ventura County air basins. In the SIP, CARB asserts that these

measures, like the near-term measures, rely on available or reasonably

foreseeable technology. CARB has also committed to investigating the

feasibility of incorporating reactivity considerations into the mid-

term measures to reduce ozone-forming potential while providing

additional flexibility at reduced costs to industry and consumers.

CARB has committed to obtaining further reductions (as compared to

the near- and mid-term measures) from consumer products after 2000.

These reductions may rely on available or in-the-pipeline technology,

and may also rely on various combinations of traditional control

strategies, technology-forcing standards, innovative market-based

approaches, and consumer education programs. These long-term measures

would be enforced on a statewide basis, but only the South Coast plan

relies on the emissions reductions to demonstrate attainment.

CARB has further categorized their emission reduction commitments

into 4 classifications, or ``measures'': CP-1, CP-2, CP-3, and CP-4.

These measures are either adopted rules or commitments to adopt rules

to reduce VOC emissions from consumer products and aerosol paints. A

description of each of these measures follows.

b. Review of Measures. (1) Measure CP-1. Measure CP-1 includes two

rules, both adopted prior to November 1994, that are designed to

control VOC emissions from commercial products. One rule controls VOC

emissions from antiperspirants and deodorants; the other rule controls

emissions from household products, such as air fresheners, shaving

cream, and hairsprays. Both rules were submitted to EPA on November 15,

1994. EPA

[[Page 1169]]

approved these rules into the SIP on August 21, 1995 (see 60 FR 43379).

(2) Measure CP-3 (Aerosol Paints). Measure CP-3 is a near term

commitment to adopt and implement VOC content standards in aerosol

paints. Regulations meeting these commitments were adopted in mid-1995.

These regulations limit the VOC content of aerosol paints by

establishing sets of VOC content standards for various coating types.

These standards establish the maximum percentage of VOC by weight

allowed in the various types of aerosol coatings. The coating standards

are divided into two phases. In the first phase, effective January 1,

1996, aerosol coatings' VOC content must comply with limits that range

from 60 percent to 95 percent, depending on the coating.

In the second phase, currently due to take effect December 31,

1999, aerosol coatings' VOC content limits will range from 30 percent

to 80 percent, depending on the type of coating. Before the second

phase of content limits can be implemented, CARB must conduct a public

hearing to determine if the limits are commercially and technologically

feasible. If the Board determines that they are not feasible, the

implementation of some or all of the limits may be postponed for up to

5 years. However, CARB must ensure that the 1999 limits do not become

federally enforceable prior to the final effective date, including any

extension, according to section 41712 (f)(3) of the California Health

and Safety Code.

EPA approval action on both phases of the aerosol paint rules will

be taken in separate rulemakings following SIP submittal of the rules.

(3) Mid-Term Committal Measure CP-2. Measure CP-2 is a mid-term

commitment to adopt additional regulations in 1997 to further reduce

VOC emissions from currently unregulated household, industrial and

institutional, and commercial consumer products. These reductions are

anticipated to result from the further regulation of new categories of

consumer products through technology that is currently feasible and

commercially viable. EPA approved CP-2 on December 14, 1995 (60 FR

64126).

(4) Long-Term Committal Measure CP-4. Measure CP-4 is a long-term

measure to further reduce emissions after measures CP-1, CP-2, and CP-3

are implemented. On August 21, 1995, EPA approved CARB's Measure CP-4

as meeting the requirements of section 182(e)(5).

(5) Alternative Control Plans (ACPs). In order to provide industry

with flexibility in meeting the VOC content limits, CARB has adopted

regulations that will allow manufacturers to meet the VOC standards on

an emissions average basis. The regulations, CARB's Alternative Control

Plan (ACP) for consumer products and aerosol coatings, require that

manufacturers carefully track sales and VOC content of all products

being averaged together in order to determine total VOC emissions from

their products and compliance with the rule. EPA will act on the ACP

regulations following submittal by the State.

c. Emission Reductions. The following table, ``Reductions from

California Consumer Products and Aerosol Paint Program,'' describes the

ROG emission reductions in terms of tons per day, as identified in the

SIP submittal. Credits for near-term consumer products (CP-1) are not

included, since they were presumed in baseline emissions projections as

adopted regulations. The table combines credits for consumer products

and aerosol paints. Credit for CP-4 is claimed only for South Coast.

The ROP and attainment demonstrations for San Diego and San Joaquin

Valley do not rely on reductions from the consumer products measures.

The State has submitted for SIP approval no emissions reductions for

these areas associated with consumer products and aerosol paints

measures, although real reductions will occur in those areas. San

Joaquin Valley Unified APCD requested that EPA identify a 1.1 tpd VOC

emissions reduction in the San Joaquin Valley area from these measures.

Since the State does not wish to claim SIP credit for these measures in

the San Joaquin Valley, EPA is not assigning the credits to San Joaquin

Valley.

Reductions From California Consumer Products and Aerosol Paint Program [Reductions Beyond Those Achieved by CP-

1]

[Tons per day of ROG]

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

1999 2002 2005 2007 2008 2010

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

South Coast...................... 0 8 39.2 ........... 42.2 89.2

SE Desert........................ 0 0.6 3.5 3.9 ........... ...........

Ventura.......................... 0 0.4 2.2 ........... ........... ...........

Sacramento....................... 0 1.1 5.6 ........... ........... ...........

San Joaquin...................... 0 ............ ........... ........... ........... ...........

San Diego........................ 0 ............ ........... ........... ........... ...........

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

d. EPA Action. As discussed above, EPA has already fully approved

all of the State's consumer products rules and committal measures with

the exception of CP-3 (Aerosol Paints). EPA is now approving CP-3 under

sections 110(k)(3) and 301(a) of the Act, and assigning credit to this

measure, as well as to the previously approved consumer products

measures, as part of the ROP and attainment demonstrations for

appropriate nonattainment areas. EPA will take regulatory action on the

recently adopted ACP and Aerosol Paints regulations themselves in

separate rulemakings.

4. Pesticides

a. Review of Measure. California's 1994 SIP submittal includes a

commitment to reduce VOC emissions from the application of agricultural

and structural pesticides. The submittal describes relevant authority

in Section 6220 of Title 3 of the California Code of Regulations that

has been granted to the California Department of Pesticide Regulation

(DPR).

b. Response to Comments. The Environmental Defense Center (EDC)

questioned whether the pesticides measure should be granted credit. EDC

stated that pest management research alone will not create any

reductions and the SIP is entirely vague as to how these air quality

benefits will be accomplished. While the NPRM refers to a June 1997

date for promulgation of regulations should the voluntary measures

fail, the SIP itself recites a possible, not obligatory, 1998 date.

Finally, EDC recommends that the pesticides rule that was included in

EPA's 1995 Federal Implementation

[[Page 1170]]

Plan (or some comparable rule) must be included in the SIP.

On May 11, 1995, CARB submitted a clarification by the California

Department of Pesticide Regulation (Memo from James W. Wells to James

D. Boyd) to the pesticide element of the SIP, submitted on November 15,

1994. This SIP clarification, which was cited in the NPRM, states, in

part, that ``The Department of Pesticide Regulation commits to adopt

and submit to U.S. EPA by June 15, 1997, any regulations necessary to

reduce volatile organic compound emissions from agricultural and

commercial structural pesticides by specific percentages of the 1990

base year emissions, by specific years, and in specific nonattainment

areas * * * as listed in the following table * * *.'' California

assigns to the pesticides measure less emission reductions than were

associated with EPA's proposed FIP rule but the SIP reductions are

sufficient to meet progress and attainment requirements in each area

for this control category.

c. Emission Reductions As described in the SIP, California has

committed to adopt and submit to U.S. EPA by June 15, 1997, any

regulations necessary to reduce VOC emissions from agricultural and

commercial structural pesticides by 20 percent of the 1990 base year

emissions in the attainment years for Sacramento, Ventura, Southeast

Desert, and the South Coast, and by 12 percent in 1999 for the San

Joaquin Valley. The table labeled ``Reductions from Pesticides

Measure'' shows reductions counted toward attainment in each area. EPA

has revised the table to reflect CEPA's request that emission

reductions for interim years be excluded from the SIP, since CARB

elects not to assign credit to the pesticides measure except for

purposes of attainment. If reductions from the measure are, in the

future, needed to meet ROP milestones, CARB must resubmit the measure

and interim reduction estimates as an SIP revision.

Reductions From Pesticides Measure

[Tons per day of ROG]

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

1999 2002 2005 2007 2008 2010

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

South Coast..................... 0 0 0 0 0 1.7

Southeast Desert................ 0 0 0 1.5

Ventura......................... 0 0 2.4

Sacramento...................... 0 0 2.8

San Joaquin..................... 13

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

d. EPA Action. EPA is approving the Pesticides measure under

sections 110(k)(3) and 301(a) of the Act, and assigning credit to the

measure as part of the attainment demonstrations for appropriate

nonattainment areas. EPA will take regulatory action on the State's

Pesticides regulations, if any regulations are required and are

submitted, in separate rulemakings.

B. Local ROP and Attainment Plans and Measures

1. Emission Inventories

a. Response to Comments. The Engine Manufacturers Association (EMA)

commented that EPA has not provided all of the data or documented all

of the assumptions that were part of California's inventory and

modeling analyses. EMA added that it has serious concerns that the

baseline emissions inventories include potentially significant

overestimates of growth in VMT, trips, and vehicle and equipment sales

and usage. EMA indicated that these estimates do not accurately reflect

the emissions reductions that will result from the imposition of

current and future national and state regulations. Finally, EMA noted

that EPA acknowledged that its baseline and projected emissions are

uncertain, and EMA requested that EPA should not take final action on

the proposed inventories but should require that appropriate

adjustments be made in order to provide accurate and reasonable

inventory calculations on which to base California's proposed measures.

EPA does not believe that it is necessary or practical for the

Agency to set forth the complete emission inventory data and

documentation. This information is available from the State and local

agencies, and amounts to thousands of pages of emissions and activity

data, emissions factors, calculations, and quality assurance programs.

The commenter provided no specific information relating to

inaccuracies in the SIP emission inventories. EPA recognizes that, in

general, the accuracy of inventories for any area can be improved. If

EMA has specific corrections to suggest, they should be provided to the

State, EPA, and local agencies for review and possible inclusion in

future SIP revisions. However, EPA has determined that the existing

inventories meet applicable SIP requirements and provide reasonable

foundations for the SIP.

The City of Los Angeles commented that the South Coast is preparing

a 1997 AQMP update, which will improve the inventory. EPA recognizes

that the improved inventory in progress may allow for SIP refinement.

If and when inventory updates and improvements are submitted as SIP

revisions for any of the nonattainment areas, EPA will consider them.

b. EPA Action. EPA is finalizing approval of the emission

inventories for each of the nonattainment areas as meeting the

requirements of section 182(a)(1) of the Act.

2. San Diego

a. SIP Control Measures. Only one comment was received on the San

Diego plan. As discussed above in Section II.A.1, CEPA asked EPA to

exclude from the San Diego SIP those emission reductions that will

result from implementation of State measures M3, M5, M8, and CP-2/CP-3,

since these reductions are not needed for purposes of progress or

attainment. EPA is deleting these credits from the emission reduction

tables for State measures in Section II.A.

EPA is not approving any new State or local measures as part of the

San Diego ozone SIP, since none were included in the State's submittal.

The State demonstrated that the ROP and attainment demonstration

provisions of the Act could be met with pre-existing regulations.

b. ROP Provisions. EPA is finalizing approval of the ROP plan as

meeting the 15% ROP requirements of section 182(b)(1) and the post-1996

ROP requirements of section 182(c)(2) of the Act. The ROP VOC targets,

projected VOC emissions, and creditable VOC and NOX reductions are

shown below in the table labeled ``San Diego ROP Forecasts and

Targets.''

[[Page 1171]]

San Diego ROP Forecasts and Targets

[Tons per summer day]

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

Milestone Year 1996 1999

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

1990 Base Year VOC Inventory....................... 312.6 312.6

VOC Projections (Adopted Measures)................. 236.1 232.0

ROP VOC Target..................................... 241.2 212.2

VOC Shortfall...................................... 0 19.8

NOX Substitution in VOC Equivalents................ 0 19.8

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

c. Modeling and Attainment Demonstration. EPA is approving the

State's modeling analysis and attainment demonstration under section

182(c)(2)(A) of the Act. A summary of the emission reductions needed to

attain the standard and reductions projected from the SIP control

strategy is provided below in the table labeled ``San Diego Attainment

Demonstration.''

San Diego Attainment Demonstration

[Tons per summer day]

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

VOC NOX

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

1990 Baseline Emissions Inventory..................... 313 238

Carrying Capacity..................................... 232 175

Reductions Needed..................................... 81 63

Reductions from Adopted Measures...................... 81 63

Reductions from Committed Local Measures.............. 0 0

Reductions from Committed State Measures.............. 1 1

Total SIP Reductions.................................. 82 64

Remaining Emissions in 1999........................... 231 174

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

d. Overall EPA Action. EPA approves the San Diego ozone SIP with

respect to the Act's requirements for emission inventories, control

measures, modeling, and demonstrations of 15% ROP, post-1996 ROP, and

attainment.

3. San Joaquin Valley

a. Control Measures. The San Joaquin Valley Unified APCD commented

that no reductions are tied to any of the transportation control

measures (TCMs) individually, but rather to the overall TCM package,

since the overall emission reductions target is expected to be achieved

but it is not anticipated that all of the measures would be

implemented. EPA's table of control measures is consistent with the

APCD's position in both the proposal and final action.

On April 4, 1996, CARB submitted a SIP revision (letter from James

D. Boyd to Felicia Marcus, attaching CARB Executive Order G-125-203).

This submittal requests EPA to delete from the existing SIP an obsolete

TCM that was originally adopted by the Fresno County APCD as part of a

1982 ozone SIP. (The Fresno County APCD has since been absorbed into

the San Joaquin Valley Unified APCD). The 1994 San Joaquin Valley AQMP

does not assume emission reductions from this TCM, but rather

substitutes a TCM package listed among the local measures in the table

labeled ``San Joaquin Local Control Measures.'' In this document, EPA

is taking final action to delete the obsolete measure, which is

entitled ``Exclusive High Occupancy Vehicle Lanes on Freeway 41.''

The table labeled ``San Joaquin Local Control Measures'' indicates

the dates of rule adoption and implementation and the emission

reductions presumed to occur by 1999, the applicable attainment

deadline. These measures are relied upon in meeting the attainment

requirements of the Act. Accordingly, and because the measures

strengthen the SIP, EPA is approving, under sections 110(k)(3) and

301(a) of the Act, the enforceable commitments to adopt and implement

the control measures by the dates specified to achieve the emission

reductions shown. EPA also is assigning credit to the measures for

purposes of attainment. EPA approval of the adopted regulations will be

completed in separate rulemakings in the future.

San Joaquin Local Control Measures

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

Reductions

Rule No. Control Measure Implementing Agency Adoption Date Implementation ---------------------------

Title Date VOC NOX

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

1999 Emission Reductions

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

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Approval and Promulgation of Implementation Plans; California Ozone · 62 FR 1150 | Frix