Approval and Promulgation of Implementation Plans; State of New Jersey; Clean Fuel Fleet Opt Out

ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[Region 2 Docket No. NJ29-1-175; FRL-5925-5]

Approval and Promulgation of Implementation Plans; State of New

Jersey; Clean Fuel Fleet Opt Out

AGENCY: Environmental Protection Agency (EPA).

ACTION: Proposed rule.

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SUMMARY: In this action, the Environmental Protection Agency (EPA) is

proposing to approve the State Implementation Plan revision submitted

by the State of New Jersey for the purpose of meeting the requirement

to submit the Clean Fuel Fleet program (CFFP) or a substitute program

that meets the requirements of the Clean Air Act (Act). EPA is

proposing to approve the State's plan for implementing a substitute

program to opt out of the CFFP.

DATES: Comments must be received on or before December 22, 1997.

ADDRESSES: All comments should be addressed to Ronald Borsellino,

Chief, Air Programs Branch, Environmental Protection Agency, Region 2

Office, 290 Broadway, New York, New York 10007-1866.

Copies of the State submittals are available at the following

addresses for inspection during normal business hours:

Environmental Protection Agency, Region 2 Office, Air Programs Branch,

290 Broadway, 25th Floor, New York, New York 10007-1866

New Jersey Department of Environmental Protection, Bureau of Air

Quality Planning, 401 East State Street, CN027, Trenton, New Jersey

08625

FOR FURTHER INFORMATION CONTACT: Michael P. Moltzen, Air Programs

Branch, Environmental Protection Agency, 290 Broadway, 25th Floor, New

York, New York 10007-1866, (212) 637-4249.

SUPPLEMENTARY INFORMATION:

I. Background

Section 182(c)(4)(A) of the Clean Air Act requires states

containing areas designated as severe ozone nonattainment areas,

including New Jersey, to submit for EPA approval a state implementation

plan (SIP) revision that includes measures to implement the Clean Fuel

Fleet program (CFFP). Under this program, a certain specified

percentage of vehicles purchased by fleet operators for covered fleets

must meet emission standards that are more stringent than those that

apply to conventional vehicles. Covered fleets are defined as fleets of

10 or more vehicles that are centrally fueled or capable of being

centrally fueled. A CFFP meeting federal requirements would be a state-

enforced program which requires covered fleets to assure that an

annually increasing percentage of new vehicle purchases are certified

clean vehicles and that those vehicles operate on clean fuel. In New

Jersey, the program would apply in the State's portion of the New York-

Northern New Jersey-Long Island ozone nonattainment area and in New

Jersey's portion of the Philadelphia-Wilmington-Trenton ozone

nonattainment area.

The federal CFFP is divided into two components. The first

component is a light duty (LD) CFFP which applies to covered fleets of

passenger cars and trucks of gross vehicle weight rating (GVWR) of

6,000 pounds and less, and trucks between 6,000 and 8,500 pounds GVWR.

Covered fleets which fall under the LD CFFP are required to assure that

30 percent of new purchases are clean vehicles in the first year of the

program, 50 percent in the second year and 70 percent in the third and

subsequent years.

The second component is a heavy duty (HD) CFFP which applies to

covered fleets of trucks over 8,500 pounds GVWR and below 26,000

[[Page 61949]]

pounds GVWR. The HD CFFP requires that 50 percent of covered fleets'

new purchases be clean fueled vehicles in the first and subsequent

years.

Under the federal CFFP, the vehicle exhaust emission standards for

LD vehicles are equivalent to those established by the California Air

Resources Board (CARB) as LD low emission vehicles (LEVs), for use in

the California LEV program (discussed in more detail in section II. of

this notice). In addition to LEVs, CARB certification exists for

transitional LEVs (TLEVs), ultra LEVs (ULEVs) and zero emission

vehicles (ZEVs). In addition, under the federal CFFP, clean vehicle

emission standards are defined for inherently low emitting vehicles

(ILEVs) and for medium and heavy duty vehicles (both of which are

covered within the HD CFFP weight category). For further information

regarding emission standards associated with all of the clean fuel

vehicles which are applicable under the LEV program and the federal

CFFP, the reader is referred to the CFFP final rule, published on March

1, 1993 at 58 FR 11888.

Section 182(c)(4)(B) of the Act allows states to ``opt out'' of the

CFFP by submitting for EPA approval a SIP revision consisting of a

program or programs that will result in at least equivalent long term

reductions in ozone-producing and toxic air emissions as achieved by

the CFFP. The Clean Air Act directs EPA to approve a substitute program

if it achieves long term reductions in emissions of ozone-producing and

toxic air pollutants equivalent to those that would have been achieved

by the CFFP or the portion of the CFFP for which the measure is to be

substituted.

New Jersey, in its 1992 SIP revision chose to preserve its right to

opt out of the CFFP but did not indicate a specific substitute measure

or measures which was to be used for that purpose. Prior to EPA action

on this commitment, the Court of Appeals for the District of Columbia

ruled that EPA's conditional approval policy with respect to state

commitments was contrary to law. [NRDC v. EPA, 22 F.3d. 1125 (D.C. Cir.

1994)]. The court held that a bare commitment from a state was not

sufficient to warrant conditional approval from EPA under section

110(k)(4) of the Act. Therefore, following this decision, EPA could not

approve New Jersey's November 1992 commitment to opt out of the CFFP.

However, in fashioning a remedy for EPA's improper use of its

conditional approval authority, the NRDC Appellate court did not want

to penalize states for their reliance on EPA's actions.

EPA also does not believe that New Jersey should lose its opportunity

to opt out of the CFFP with a substitute program that meets the

requirements of section 182(c)(4)(B) because of EPA's inability to act

on New Jersey's commitment, especially since New Jersey has since

submitted such a substitute program for EPA approval.

Therefore, EPA is considering all relevant submissions made thus

far by the State that are intended to substitute for the CFFP.

The Region received from New Jersey a proposed SIP revision dated

May 15, 1994. The submittal, consisting of New Jersey's then proposed

LEV program, was intended to fulfill the State's CFFP obligations.

However, because the Clean Air Act requires SIP revisions to consist of

adopted measures, and because the opt out measure was only in the

proposal stage, EPA transmitted a finding of failure to submit the

required SIP revision in a letter to the State on October 3, 1994. New

Jersey then had 18 months from the date of the letter to submit the

required SIP before sanctions were to take effect.

On February 15, 1996, in order to cure the finding of failure to

submit, New Jersey submitted its New Jersey Clean Fleets (NJCF) program

as a substitute for the federal CFFP. As described earlier, the federal

CFFP is a state-enforced program which requires that operators of

covered vehicle fleets assure that a percentage of their new vehicle

purchases are certified clean vehicles and that those vehicles operate

on clean fuel. By contrast, the NJCF program is an essentially

voluntary mix of incentive-based programs which are intended to spur

public and private fleets within New Jersey to purchase clean,

alternatively fueled vehicles (AFVs) (discussed in more detail in

section III. C. of this notice).

On March 29, 1996, New Jersey supplemented the CFFP SIP revision

with a letter clarifying that the NJCF program substitution includes,

to the extent necessary to meet SIP obligations, New Jersey's LEV

program which had been adopted by that time. Because the emissions

reductions relied upon in the NJCF program will largely result from

voluntary measures, the State's LEV program essentially serves the role

of a ``backstop'' to the NJCF program. This means that in the event the

NJCF program fails to achieve the emissions reductions claimed by the

State, emission reductions achieved with the separate LEV program will

be used by the State to account for those reductions that would have

originally been realized through the federal CFFP. In that event EPA

would then recognize the State's LEV program as the effective opt out

measure.

Unlike the federal CFFP, the LEV program imposes requirements on

auto manufacturers and their yearly vehicle sales. New Jersey adopted a

LEV regulation states that New Jersey's primary intention is to

participate in the National LEV (NLEV) program (discussed in more

detail in the section II. C.4. of this notice). However, EPA cannot

require NLEV--it must be mutually agreed upon by the participating

states and the auto manufacturers--and if NLEV fails to become

effective (due to lack of such an agreement), New Jersey's regulation

states that it will operate a State LEV or ``California'' LEV program

(discussed in more detail in section II. of this notice), an option

afforded states in the Clean Air Act (see Clean Air Act section 177).

The NLEV and State LEV programs are similar in that where applicable,

auto manufacturers must meet an average vehicle emission standard,

based on the certified emission standards of all annual vehicle sales.

The annual average vehicle emission standard (referred to as the non-

methane organic gas (NMOG) average) increases in stringency on an

annual basis. Quantitatively, NLEV or State LEV, whichever is

ultimately implemented in New Jersey, will achieve long term vehicle

emission reductions which are far greater than what the federal CFFP

could have achieved.

Based on these provisions in the SIP revisions submitted by New

Jersey on February 15, 1996 and March 29, 1996, EPA sent a letter to

New Jersey on April 4, 1996 notifying the State that the finding of

failure to submit had been withdrawn. New Jersey amended its NJCF SIP

revision with a March 6, 1997 submittal, which included comments on the

proposed SIP revision received by the State, including those received

at a State-held public hearing on October 21, 1996.

The Clean Air Act requires states to observe certain procedural

requirements in developing implementation plan revisions for submission

to EPA. Sections 110(a)(2) and 172(c)(7) of the Act require states to

provide reasonable notice and public hearing before adoption by the

state and submission to EPA for approval. Section 110(1) of the Act

also requires states to provide reasonable notice and hold a public

hearing before adopting SIP revisions.

EPA must also determine whether a state's submittal is complete

before taking further action on the submittal. See section 110(k)(1).

EPA's completeness criteria for SIP submittals are set out in 40 CFR

Part 51, Appendix

[[Page 61950]]

V (1993). New Jersey's SIP revision which EPA is proposing to approve

in this notice meets all of the procedural requirements and

completeness criteria.

II. State Submittal

New Jersey submitted SIP revisions on February 15, 1996, March 29,

1996 and March 6, 1997 which substituted the State's NJCF program,

backstopped by New Jersey's adopted and enforceable LEV program, for

the federal CFFP. The adopted LEV regulation requires the

implementation of a program identical to the California LEV program or,

if certain triggering events occur, participation in the National LEV

program (discussed in more detail in section III. C.4. of this

section). The LEV program operated in California requires that each

model year of vehicles produced for sale, beginning with model year

1994, be certified to meet a specific NMOG standard when their total

emissions are averaged as a fleet. Manufacturers must ensure that each

model year of vehicles produced for sale, meet a yearly NMOG fleet

average. The California LEV fleet-average NMOG standard was 0.25 grams

per mile for model year 1994. The NMOG average becomes increasingly

more stringent annually, and for model year 2003 and later the standard

is 0.063 grams per mile.

New Jersey held a public hearing on October 21, 1996 to entertain

public comment on its federal CFFP substitute SIP revision; this

hearing included the State's proposal to opt out of the CFFP with its

NJCF program and LEV backstop as a substitute program.

III. Analysis of State Submission

A. Opt Out Criteria and Requirements

Section 182(c)(4) of the Clean Air Act, which allows states

required to implement a CFFP to opt out of the program by submitting a

SIP revision consisting of a substitute program, requires that the

substitute program result in long term emission reductions equal to or

greater than does the CFFP. Also, EPA can only approve such substitute

programs that consist exclusively of provisions other than those

required under the Clean Air Act for the area. New Jersey's backstopped

NJCF program satisfies both of these requirements.

B. Equivalency of Substitute

The Clean Air Act requires that any substitute for the federal CFFP

must provide equivalent long term emission reductions. In its SIP

revision, the State estimated the emission reductions which would be

attributable to operation of the federal CFFP in New Jersey. It is this

amount of long term reduction, discussed below, which the State's

substitute must achieve.

Light Duty Vehicle Analysis

New Jersey first analyzed the potential for emissions reductions to

result from long term compliance with the LD vehicle portion of the

federal CFFP in New Jersey. The LD vehicle purchase requirements of the

federal CFFP are intended to ensure a gradual turnover of conventional

LD fleet vehicles to clean LD vehicles in covered fleets. In the long

term, a substantial portion of LD vehicles in covered fleets, where the

program is operated, would meet the LEV (or cleaner) standard, where

otherwise they would not have met those more stringent standards (i.e.,

if the State was not also operating a LEV program as described above).

In its SIP revision however, New Jersey pointed out that the LD vehicle

portion of the federal CFFP, in the long term, would essentially

duplicate the Statewide, more comprehensive New Jersey LEV program

which has already been adopted [Adopted on November 22, 1995 at 27

N.J.R. 5016(a) (December 18, 1995), codified at N.J.A.C. 7:27-26].

In the SIP revision, New Jersey explained that its LEV program is

more comprehensive than the LD portion of the federal CFFP, because it

will require virtually all LD vehicles sold in New Jersey (including

fleet and non-fleet vehicles) to meet, by model year 2000, the LEV

standard when their total emissions are averaged. By contrast, the

federal LD CFFP will only require 70 percent of new vehicle purchases

in covered fleets to meet the LEV standard in the long term, a

requirement which would be met through the State's LEV requirements,

imposed on the vehicle manufacturers.

New Jersey also noted that its LEV program begins one year later

(model year 1999) than the federal CFFP (model year 1998). The State

offered the justification that in the long term however, the LEV

program requirements would make up for any shortfall in LD vehicle

emission reductions that might be caused by the difference in start

dates. However, subsequent to the date that New Jersey made its opt out

submission to EPA, EPA has determined that a one year delay of

implementation of the CFFP is necessary and appropriate. The delay is

needed due to a stated lack of availability of the requisite types and

numbers of clean fueled vehicles in the majority of the areas which are

required to implement and comply with the regulatory requirements of a

CFFP. This guidance and policy decision, which was based on input from

all of the program stakeholders, was transmitted in a May 22, 1997 memo

from EPA Office of Mobile Sources Director Margo Oge to EPA's Regional

Air Directors. EPA anticipates publishing a rulemaking in the Federal

Register shortly, finalizing the delay. The fact of the delay further

lends equivalency to the NJCF program as a CFFP opt out, since both

programs will now start at the same time.

With further examination of the relative effects of these programs,

New Jersey also noted that there will still exist certain aspects of

the federal LD CFFP that could result in greater emission reductions

than the NJCF program on an individual LD vehicle basis. As an example,

the State discussed the requirement that LEVs operate on the fuels for

which they were certified to operate on, and that the federal CFFP

requires that covered fleets must ensure that a certain percentage of

their new vehicle purchases (both light and heavy duty) are certified

to meet LEV (or cleaner) standards. By contrast, the NJCF program is

voluntary (with the exception of the Energy Policy Act (EPAct),

discussed in further detail in section C.). The State again justified

the equivalency claim of its opt out measure by explaining the reasons

why these differences are not significant discrepancies. With respect

to the loss of emission reduction benefits that would occur from

gasoline-powered LEVs operating on federal reformulated gasoline (RFG)

rather than the fuel that they were certified to operate on (e.g.,

California RFG), New Jersey explained that such a loss would be

relatively small in the long term. The State claims that this is true

because the reductions from the federal CFFP would occur only on a per

vehicle basis, and because of its anticipation that a substantial

number of LEVs will be operating on alternative fuels, in the later

years of the State LEV program, that are cleaner than California RFG.

EPA agrees with this line of reasoning, as well as with New Jersey's

assertion that the overall additional benefit of the federal CFFP's

fuel requirement for LEVs would be relatively small and insignificant

in the long term for those reasons.

EPA agrees with New Jersey that implementation of the federal LD

CFFP, in addition to either the NLEV or the State LEV program (the

State has made certain through its regulations that one or the other

will be implemented), for any small incremental benefits in light of

the additional administrative requirements of the federal CFFP, would

be burdensome and impractical. Lastly, EPA has determined, for the

reasons

[[Page 61951]]

stated above, that the State does not need to account explicitly for

the long term emission reductions which would have been associated with

a LD CFFP since those reductions are negated by operation of a LEV

program.

Heavy Duty Vehicle Analysis

The heavy duty vehicle portion of the federal CFFP requires that on

an annual basis, 50 percent of heavy duty fleet vehicles purchased each

year must meet clean fuel vehicle emission standards. Through

appropriate modeling, New Jersey has determined that the estimated

emission reduction benefit that would result from applying the federal

CFFP's heavy duty vehicle requirements in New Jersey would be

approximately 4.5 tons per day (tpd) of VOC and NOX combined

in 2010 (modeling techniques and assumptions used to arrive at this

figure are described below). New Jersey assumes in its SIP, and EPA

agrees with the assumption, that modeling emission reductions out to

the year 2010 is adequate for the purpose of determining the long term

reductions which could be expected of the heavy duty CFFP in New

Jersey. The NJCF program must achieve that amount of emission

reductions within the same time frame in order to be an acceptable

substitute for the federal CFFP. If it does not, as will be verified

through the program emission reduction tracking system that the State

committed to implement (described in more detail below), the State has

also committed to use emission reduction credit generated from either

the NLEV program or the State LEV program to make up any emission

reduction shortfall which may result.

Modeled Reductions from the CFFP

In order to determine the level of long term emissions reductions

which needs to be provided by its opt out measures, the State employed

the latest version of the mobile source emission model approved by EPA,

MOBILE5a. Emission factors generated by the MOBILE model were used in

conjunction with proscribed CFFP calculation guidelines in EPA's June

1994 CFFP Regulatory Impact Analysis (RIA). New Jersey determined

through this modeling that the long term reductions associated with the

federal CFFP would equal 4.5 tons per day of NOX and VOC

combined.

C. NJCF Program Details and Goals

NJDEP has estimated that, in order to meet the Clean Air Act

requirement of an approvable CFFP substitute, the NJCF program must

provide emission reductions equivalent to those from approximately

50,750 medium heavy duty certified clean fueled vehicles by 2010. NJDEP

estimates that about 176 of these vehicles will come from the Clean

Cities program, and the remainder from the efforts of the Incentive

Development Workgroup (both of which are described below).

NJDEP has determined that in order to contribute towards the

emission reductions needed for a substitute program, a medium or heavy

duty vehicle must be certified by CARB to meet LEV (or cleaner)

standards. For this reason New Jersey's SIP revision does not rely on

emission reductions from alternative fuel vehicle (AFV) conversions to

meet the target of 4.5 tons per day of NOX and VOC combined

by 2010. Furthermore, AFV conversions will comprise a relatively small

percentage of total clean AFVs in use in New Jersey in the long term.

EPA agrees with this conservative approach in today's proposed

approval.

The NJCF program consists of the following four components: (1)

Incentive Development program, (2) the Department of Energy's (DOE's)

EPAct fleet requirements, (3) DOE's Clean Cities program, and 4) the

Advanced Technology Vehicle (ATV) component of EPA's finalized NLEV

program.

1. Incentive Development Program

The incentive development program was developed by a public/private

workgroup which includes representatives of local and national fleet

operators, municipalities, alternative and clean fuel providers, and

government officials. The Workgroup's efforts are intended to spur use

of clean alternative fuel vehicles. Major areas of focus for the

Workgroup, as it implements its Action Plan, include development of a

New Jersey alternative fuel mechanic training program and promotion of

a State policy supporting the use of alternative fuels and AFVs.

2. EPAct Purchase Mandates

The second component of the NJCF program is the alternative fuel

vehicle purchase requirements under the federal EPAct, 42 U.S.C.

Sec. 13201 et seq. Under EPAct, all state, federal, and fuel-provider

fleets must ensure that a percentage of their new LD vehicle purchases

operate on alternative fuels. In the long term, 75% of new state and

federal purchases and 90% of fuel-provider purchases must be AFVs. To

date, New Jersey reports that 61 State vehicles have been converted to

run on clean alternative fuels as a result of EPAct compliance, and

alternative fuel vehicles are available for purchase by public agencies

through the State purchase contract.

3. New Jersey Clean Cities Program

Clean Cities is a voluntary federal program designed to accelerate

and expand the use of clean AFVs and related refueling infrastructure

in communities throughout the country. In 1995 the State's Division of

Energy initiated Clean Cities programs in the metropolitan areas of

Elizabeth, Jersey City, Newark and Trenton; New Jersey plans to expand

these programs in other areas of the State as well. New Jersey expects

the program to have a significant long term emission reduction benefit.

4. Advanced Technology Vehicle Program

The fourth component of the NJCF program is the Advanced Technology

Vehicle (ATV) component of the NLEV program. NLEV is an alternative to

the Ozone Transport Commission (OTC) LEV program, which the OTC

petitioned EPA to require. EPA had made a determination requiring LEV

to be adopted throughout the northeast ozone transport region (OTR);

however a Federal Circuit Court has since remanded that requirement.

Virginia v. EPA, No. 95-1163 (D.C. Cir. March 11, 1997). NLEV is a

voluntary program wherein auto manufacturers would manufacture low

emission vehicles nationwide instead of just for the OTR and

California.

EPA proposed the NLEV program in October 1995, and issued the final

NLEV rule in the June 6, 1997 Federal Register (62 FR 31192). EPA also

issued an NLEV supplementary Notice of Proposed Rulemaking (SNPRM) on

August 22, 1997. EPA intends to finalize the SNPRM by mid- to late-

autumn, 1997. Auto manufacturer and OTC state opt-ins shortly

thereafter will ensure program startup in time for model year 1999 LEVs

in the OTR.

In EPA's June 6, 1997 NLEV final rulemaking, an ATV was defined as

any vehicle certified by CARB or EPA that is either: (1) A dual-fuel,

flexible-fuel, or dedicated alternatively fueled vehicle certified as a

transitional low emission vehicle (TLEV), LEV, or ultra low emission

vehicle (ULEV) when operated on the alternative fuel; (2) certified as

a ULEV or Inherently Low Emission Vehicle (ILEV); or (3) a dedicated or

hybrid electric vehicle. As discussed in that rulemaking, EPA

acknowledges the suggestion that advancing motor vehicle pollution

control technology is an important benefit of NLEV. Furthermore, it has

been suggested by several parties, including New Jersey, that

establishment of an ATV component should be a criterion for

[[Page 61952]]

determining whether NLEV is an acceptable LEV-equivalent program.

Although EPA agrees that advancing technology is an important goal, and

EPA believes that the NLEV program could be a part of an agreement that

would provide important opportunities to promote ATVs, the regulatory

portion of the NLEV program does not address ATVs, EPA does not believe

that advancing technology is or should be a legally-required criterion

for approval of a LEV-equivalent program, and given the court decision

invalidating the OTC LEV SIP call, there is no longer any legal

requirement for NLEV to be a LEV-equivalent program. Nevertheless, EPA

recognizes that including some advanced technology component is

important and could provide additional environmental benefits beyond

emissions reduction equivalency. Furthermore, EPA agrees with New

Jersey's intention to use the ATV component as part of its substitute

(backstopped by the enforceable State LEV program) for the federal

CFFP. The ATV program involves a cooperative effort among the states in

the OTR, EPA, DOE, fuel providers, aftermarket converters, fleet

operators, and the full range of motor vehicle manufacturers to develop

ways to increase use of ATVs. The NJDEP expects to begin implementing

the ATV program, in cooperation with other states, the auto

manufacturers, and fuel providers, as soon as the NLEV program with an

ATV component becomes effective.

In order to facilitate implementation of the NJCF program, New

Jersey has stated in its latest SIP revision that it is relying on EPA

to support the ATV initiative by approving emission reduction SIP

credits, where appropriate, upon the introduction of ATVs into the

fleet. EPA is prepared to assist the State in this manner (i.e. by

allowing long term emission reductions generated by the ATV component

of NLEV to be used in part as a substitute SIP measure for the CFFP),

provided emissions reductions from the ATV provision, along with those

generated from the other NJCF program components, can be documented by

the State. It is for this purpose that New Jersey has incorporated a

planned system to track NJCF program emissions reductions. This system,

described below, will serve to identify the need, if any should exist

in the future, to utilize the credit from the State's adopted LEV

program (i.e., the backstop) should the planned reductions not occur as

intended with the voluntary NJCF program.

NJCF Program Backstop

New Jersey, in exercising its option under section 177 of the Clean

Air Act, has adopted a LEV program which affects all new LD vehicles

sold State-wide, specifically passenger cars and LD trucks under 6,000

lbs. gross vehicle weight rating (GVWR) for vehicle model years 1999

and later. The LEV program sets forth five different sets of emission

standards, and vehicle manufacturers may market any combination of

vehicles provided that the annual average emissions of each

manufacturer's fleet complies with a fleet average limit that becomes

more stringent each year.

New Jersey's LEV program will assure reductions of ozone-forming

and air toxics emissions that are at least equivalent to those that

would be realized through the LD portion of a CFFP; in the event that

the NJCF failed to reduce long term emissions to the level which would

have been achieved by the CFFP, LEV could make up the resultant

shortfall.

Vehicle Tracking System

As part of its most recent NJCF SIP revision, New Jersey has

committed to implement an automated tracking system to track clean

fueled vehicle purchases and conversions associated with the NJCF

program (detailed above) throughout the State beginning in 1998. The

State will periodically track the variety of clean NJCF vehicles

purchased in New Jersey, but most notably CARB certified LEVs (and

vehicles certified to more stringent standards, such as ULEVs). The

information gathered from the automated tracking system would provide

an accurate indication of the number of vehicles purchased in New

Jersey that are certified to meet the applicable LEV, etc. standards.

In this manner the State can accumulate a database with which it can

calculate emission reduction benefits associated with certified clean

vehicle purchases resulting from the NJCF program, and determine if

necessary the need to employ the LEV backstop discussed above.

IV. Summary of Action

In this proposed rule, EPA is proposing to approve New Jersey's SIP

revision submitted to fulfill the Clean Fuel Fleet requirements of the

Clean Air Act. EPA believes New Jersey's Clean Fleet program,

backstopped by the adopted New Jersey LEV program implementing the low

emission vehicle program are an adequate substitute for the federal

Clean Fuel Fleet program under section 182(c)(4).

Nothing in this rule should be construed as permitting or allowing

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

SIP. Each request for revision to any SIP shall be considered

separately in light of specific technical, economic, and environmental

factors and in relation to relevant statutory and regulatory

requirements.

Administrative Requirements

Executive Order 12866

The Office of Management and Budget has exempted this action from

review under Executive Order 12866.

Unfunded Mandates

Under section 202 of the Unfunded Mandates Reform Act of 1995

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

must prepare a budgetary impact statement to accompany any proposed or

final rule that includes a federal mandate that may result in estimated

annual costs to State, local, or tribal governments in the aggregate;

or to private sector, of $100 million or more. Under section 205, EPA

must select the most cost-effective and least burdensome alternative

that achieves the objectives of the rule and is consistent with

statutory requirements. Section 203 requires EPA to establish a plan

for informing and advising any small governments that may be

significantly or uniquely impacted by the rule.

EPA has determined that the approval action proposed does not

include a federal mandate that may result in estimated annual costs of

$100 million or more to either State, local, or tribal governments in

the aggregate, or to the private sector. This federal action approves

pre-existing requirements under State or local law, and imposes no new

requirements. Accordingly, no additional costs to State, local, or

tribal governments, or to the private sector, result from this action.

Regulatory Flexibility Act

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

must prepare a regulatory flexibility analysis assessing the impact of

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

Alternatively, EPA may certify that the rule will not have a

significant impact on a substantial number of small entities. Small

entities include small businesses, small not-for-profit enterprises,

and government entities with jurisdiction over populations of less than

50,000.

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

Clean Air Act do not create any new requirements, but

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simply approve requirements that the State is already imposing.

Therefore, because the federal SIP-approval does not impose any new

requirements, I certify that it does not have a significant impact on

any small entities affected. Moreover, due to the nature of the

federal-state relationship under the Clean Air Act, preparation of a

regulatory flexibility analysis would constitute federal inquiry into

the economic reasonableness of state action. The Clean Air Act forbids

EPA to base its actions concerning SIPs on such grounds. Union Electric

Co. v US EPA, 427 US 246, 256-66 (S.Ct. 1976); 42 U.S.C. 7410(a)(2).

List of Subjects in 40 CFR Part 52

Environmental protection, Air pollution control, Nitrogen dioxide,

Ozone, Volatile organic compounds.

Authority: 42 U.S.C. 7401-7671q.

Dated: November 6, 1997.

William J. Muszynski,

Acting Regional Administrator.

[FR Doc. 97-30521 Filed 11-19-97; 8:45 am]

BILLING CODE 6560-50-P