Approval and Promulgation of Implementation Plans; State of Kansas

ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[KS 019-1019; FRL-5800-7]

Approval and Promulgation of Implementation Plans; State of

Kansas

AGENCY: Environmental Protection Agency (EPA).

ACTION: Proposed rule.

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SUMMARY: The EPA proposes to approve the State Implementation Plan

(SIP) revision concerning Kansas Air Regulation (K.A.R.) 28-19-79, Fuel

Volatility, submitted by the Kansas Department of Health and

Environment. This revision would set a summertime gasoline Reid Vapor

Pressure (RVP) limit of 7.2 pounds per square inch (psi), and 8.2

pounds per square inch for gasoline containing at least 9.0 percent by

volume but not more than 10.0 percent by volume ethanol, for gasoline

distributed in Wyandotte and Johnson Counties as part of the state plan

to maintain its clean air quality.

DATES: Comments must be received on or before April 23, 1997.

ADDRESSES: Comments may be mailed to Stan Walker, Environmental

Protection Agency, Air Branch, 726 Minnesota Avenue, Kansas City,

Kansas 66101.

FOR FURTHER INFORMATION CONTACT: Stan Walker at (913) 551-7494.

SUPPLEMENTARY INFORMATION:

I. Background

The Clean Air Act (CAA, or the Act) requires states which have

areas failing to meet the National Ambient Air Quality Standard (NAAQS)

for ozone to develop SIPs with sufficient control measures to attain

and maintain the standard. The EPA designated the Kansas City

Metropolitan Area (KCMA) as an area failing to meet the NAAQS on March

3, 1978. The area designated as nonattainment included five counties:

Platte, Clay, and Jackson Counties in Missouri, and Johnson and

Wyandotte Counties in Kansas. In spite of a series of SIP revisions,

the area continued to experience violations of the ozone NAAQS

throughout the 1980s. Each time violations occurred beyond an

attainment date, the EPA notified the Governor and called for a

revision to the Kansas SIP. In response to the last of these SIP calls,

KDHE submitted a SIP revision which demonstrated attainment of the

ozone NAAQS by December 31, 1987. Although the area experienced a

number of violations in 1988, no violations were experienced during the

subsequent three-year period.

In an effort to comply with the 1990 Amendments to the CAA, and to

ensure continued attainment of the ozone NAAQS with an adequate margin

of safety, the state submitted an ozone maintenance SIP for the Kansas

portion of the KCMA on October 23, 1991. Accompanying the maintenance

SIP were several new rules to control volatile organic compound (VOC)

emissions from certain categories, the state's request to redesignate

the KCMA as an attainment area with respect to the ozone NAAQS, and a

commitment to implement certain contingency measures should the area

exceed certain emission levels or experience additional violations. The

EPA approved the

[[Page 13850]]

maintenance SIP and redesignated the KCMA to attainment on June 23,

1992.

During the three-year period following approval of the maintenance

SIP, a number of exceedances of the ozone standard were recorded in the

KCMA. As a result, the KCMA was once again in violation of the ozone

NAAQS. The EPA notified the state of the violation on January 31, 1996,

and requested that the contingency measures in the approved plan be

implemented. Due to various problems associated with implementation of

contingency measures in the approved contingency plan, the local

community undertook an evaluation of substitute measures which could be

implemented. After an extensive evaluation of available options, the

Mid-America Regional Council (MARC), in conjunction with the Kansas

City Air Quality Forum, recommended a package of measures to Kansas and

Missouri. This recommendation contained a number of measures for

implementation as contingency measures, including lower volatility

gasoline. This notice and the accompanying technical support document

(TSD) provide an analysis of the lower volatility gasoline portion of

the package of substitute measures.

II. Regulatory Objective

RVP is a measure of a fuel's volatility and thereby affects the

rate at which gasoline evaporates and emits VOCs; RVP is directly

proportional to the rate of evaporation. Consequently, the lower the

RVP, the lower the rate of evaporation. Lowering the RVP in the summer

months can offset the effect of summer temperature upon the volatility

of gasoline, which, in turn, lowers emissions of VOCs. VOC is an

important component in the production of ground level ozone in the hot

summer months. Reduction of RVP will help the state's effort to attain

and maintain compliance with the NAAQS for ozone.

III. State Submittal

On December 5, 1996, KDHE submitted to the EPA Region VII a SIP

revision to establish new limits on fuel volatility. These control

measures were submitted as part of several contingency measures

necessary for the KCMA to maintain clean air quality. Included in the

submittal was a letter from Secretary James J. O'Connell, KDHE, to

Dennis Grams, EPA Region VII Administrator, requesting authorization to

implement a lower RVP requirement in the Kansas City area; Kansas

Regulation, K.A.R. 29-19-79; and a Regulatory Impact Statement

including an Environmental Impact Statement and an Economic Impact

Statement. In addition, on December 19, 1996, John C. Irwin, Director,

Bureau of Air and Radiation, KDHE, also sent a letter requesting the

EPA to parallel process the rule to provide adequate time for gasoline

facilities to prepare for the change in fuel volatility. The state held

a public hearing on January 23, 1997.

Pursuant to the December 19, 1996, request from the state, the EPA

is parallel processing this SIP revision concurrently with the state's

proposal and adoption procedures for amending its SIP.

In parallel processing, the EPA proposes rulemaking action

concurrently with the state's procedures for amending its regulations.

If the state substantially changes its proposed regulatory revision in

areas other than those identified in this notice, the EPA will evaluate

those changes and may publish another notice of proposed rulemaking. If

no substantial changes are made other than those areas cited in this

notice, the EPA will publish a final rulemaking notice on the

revisions. The final rulemaking action by the EPA will occur only after

the SIP revision has been adopted by Kansas and submitted formally to

the EPA for incorporation into the SIP.

IV. Analysis of the SIP

A. Necessity Finding

Under sections 211(c) and 211(h) of the CAA, the EPA has

promulgated nationally applicable Federal standards for RVP levels in

motor vehicle gasoline. Because a Federal control promulgated under

section 211(c)(1) applies to the fuel characteristic RVP, nonidentical

state controls are prohibited under section 211(c)(4). Section

211(c)(4)(A) of the Act prohibits state regulation respecting a fuel

characteristic or component for which the EPA has adopted a control or

prohibition, unless the state control is identical to the Federal

control. Under section 211(c)(4)(C), the EPA may approve a nonidentical

state fuel control as a SIP provision, if the state demonstrates that

the measure is necessary to achieve the national primary or secondary

ambient air quality standard that the plan implements. The EPA can

approve a state fuel requirement as necessary only if no other measures

would bring about timely attainment, or if other measures exist but are

unreasonable or impracticable. While the Kansas low RVP requirement is

preempted by the Federal RVP requirements, the state can implement the

low RVP requirement if the EPA finds it necessary and approves it as a

revision to the SIP.

In its submittal, Kansas showed that additional VOC reductions are

needed to address Kansas City's recent history of nonattainment

problems and to assure continued attainment of the ozone NAAQS in the

KCMA. While the area is designated as attainment for the ozone NAAQS,

the KCMA is currently in danger of violating the standard due to

exceedances occurring in the 1995-1996 period. Kansas estimates that

the area needs to achieve approximately 8.5 tons per day of VOC

reductions to continue to achieve attainment of the ozone NAAQS.

Because emission trends continue to increase, the state believes it is

important that control measures producing a significant portion of the

needed reductions be implemented in time to reduce emissions beginning

in the 1997 ozone season. Otherwise, there is a significant risk of

exceedances and violations in 1997, and this risk will increase over

time. The EPA agrees that an important criteria in evaluating the

reasonableness of each control measure is whether it will achieve

significant emission reductions in the near term, beginning in the 1997

and 1998 ozone seasons.

Kansas evaluated a broad range of available control measures to

determine whether there are sufficient reasonable and practicable

measures available to produce the needed emissions reductions without

requiring low RVP gasoline. In addition to assessing the quantity of

emission reductions attributable to each control measure, the state

also considered the time needed for implementation and cost-

effectiveness of each measure in evaluating the reasonableness and

practicability of the other control measures in comparison to low RVP

gasoline requirements. The cost-effectiveness ratio is based on the

cost expected to be incurred from 1997 through 2006, resulting from

implementing the control measure, divided by the 10-year sum of the

daily VOC reductions. Kansas found that a 7.2 psi low RVP requirement

could be implemented in time for the 1997 ozone season, would produce

an estimated 4.1 tons per day of VOC emissions reductions, and has an

estimated cost-effectiveness ratio of 1.1. The state also evaluated the

following other measures: Stage II vapor recovery, reformulated

gasoline, vehicle I/M programs, clean fueled fleets (CFF) program,

light rail transit, free transit, and parking surcharge. Based on the

state's evaluation, the EPA finds that there are not sufficient other

reasonable and practicable measures available to produce the quantity

of emissions reductions needed to continue to

[[Page 13851]]

achieve the NAAQS, and thus a low RVP requirement is necessary.

Kansas found that free transit on red sky-cast days can be

implemented in time for the 1997 ozone season and has a very favorable

cost-effectiveness ratio, but would generate only 0.3 tons per day

reductions, which is a very small fraction of the goal of 8.5 tons per

day total reductions. Free transit throughout the ozone season could be

implemented on the same time frame, is less cost-effective, and would

generate an additional 0.3 tons per day reductions. A parking surcharge

could also be implemented promptly, but has a very high cost-

effectiveness ratio and would add only 0.6 tons per day reductions.

Thus, even if the state were to implement all of these measures they

would not produce a significant quantity of emissions reductions in the

next few ozone seasons, and hence would not be sufficient to ensure

that the state will continue to achieve the ozone NAAQS.

While a number of other measures would achieve substantially

greater reductions than free transit and a parking surcharge, the state

found that all of these measures would take considerably longer to

implement than low RVP, and none would produce emission reductions

beginning in the 1997 and 1998 ozone seasons. One option the state

considered is Stage II vapor recovery, which would reduce emissions an

estimated 6.9 tons per day. However, Stage II would take approximately

18 months to implement, which means it would not reduce emissions

before the 1999 ozone season. Moreover, installation of the Stage II

equipment would require additional underground piping as well as new

hose and nozzle sets at each affected station. Stage II would require

substantial compliance efforts by a larger number of entities than

would a low RVP requirement, and it would mainly affect smaller

entities, which may have more difficulty absorbing compliance costs.

Another potential option is either a centralized or decentralized

I/M program, with emissions reductions estimated ranging between 2.4

tons per day (basic decentralized I/M) and 25 tons per day (the EPA

recommended centralized enhanced I/M), depending upon the type of I/M

program selected. Kansas estimated that an I/M program would take four

to six years to fully implement and three to four years before

producing any emissions reductions benefits. An I/M program would

require legislative as well as regulatory action in both Missouri and

Kansas. Additionally, an I/M program would require development of

substantial infrastructure (e.g., testing facilities) in the Kansas

City area, and would require participation by every motor vehicle

owner.

Kansas also considered light rail transit as a potential control

measure, with estimated emissions reductions of 0.1 tons per day. The

state considers light rail transit as an option only for the long term

because it would require substantial lead time for implementation. Both

Kansas and Missouri would have to pass authorizing legislation and

secure funding sources. The states would also have to acquire land and

undertake a large-scale construction project. Moreover, the state

estimated that this option has a high cost-effectiveness ratio

(compared to low RVP).

Finally, Kansas has been working to develop a CFF program by

forming a workgroup to help develop an intrastructure for the program.

Currently this program is in the planning stages and could take

approximately two to three years to implement. Since this program is in

the planning stages, exact emission reduction credits have not yet been

identified. The expected reductions from the CFF program would produce

only a portion of the identified goal of 8.5 tons per day leaving a

need for additional significant reductions to continue to achieve

attainment.

Given that low RVP is the only option that would produce

substantial emissions reductions in the near term, and given its

comparative ease of implementation (as well as superior cost-

effectiveness to some of these options), the EPA finds that each of the

measures discussed above is unreasonable in comparison to a low RVP

requirement. This finding does not imply that these measures would be

unreasonable if additional reductions were needed beyond those that

would be produced by low RVP, or that these measures would be

unreasonable given a longer time frame to reduce emissions. In addition

to the measures discussed above, the state also evaluated opt-in to

Federal reformulated gasoline (RFG) as another option. The EPA finds

that opt-in to RFG is impracticable at this time because the area is a

designated attainment area and, under current EPA regulations, only

designated nonattainment areas can opt in to RFG.

B. Emission Impact of the Fuel Volatility Control

The fuel volatility control was identified by MARC as a control

measure that could be implemented by the 1997 ozone season and will

contribute significantly toward the established emission control.

Reducing the fuel volatility limit from 7.8 to 7.2 psi will reduce VOC

emissions by an expected 4.1 tons per day. Most of the emission

reductions will occur from vehicle emissions (4.0 tons per day), and

0.1 tons per day will come from nonroad emissions, including storage

and refueling emission.

C. Economic Impacts of the Fuel Volatility Control

The fuel volatility control will affect the cost of producing the

gasoline. It is estimated that it will cost refineries an additional

1.5 cents per gallon to produce 7.2 psi RVP gasolines. Some cost will

be passed on to the consumer; therefore, consumers in the KCMA may

experience a gasoline price increase of about 1.5 cents per gallon.

V. Analysis of the Rule

The Kansas rule specifies that no person shall dispense, supply,

exchange in trade, offer for sale or supply, and sell or store gasoline

used as a fuel for motor vehicles and that has an RVP greater than 7.2

psi, or 8.2 psi for gasoline containing at least 9.0 percent by volume

but not more than 10.0 percent by volume ethanol. This rule applies

beginning June 1 through September 15 of each year.

In addition, facilities other than a gasoline dispensing facility

shall keep and maintain at the facility, for two years following the

date of the RVP test, records of the information regarding the RVP of

gasoline that is to be used as a fuel for motor vehicles.

Gasoline used exclusively for fueling implements of agriculture and

gasoline in any tank, reservoir, storage vessel, or other stationary

container with a nominal capacity of 500 gallons or less are exempt

from this regulation.

The sampling procedures and test methods are consistent with the

EPA recommendations as described in 40 CFR part 80, appendices D, E,

and F.

Proposed Action

The EPA is proposing to approve this revision to the Kansas SIP

concerning K.A.R. 28-19-79. At the state's request, the EPA is parallel

processing this action.

Nothing in this action 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 the SIP shall be

considered separately in light of specific technical, economic, and

environmental factors, and in relation to relevant statutory and

regulatory requirements.

[[Page 13852]]

VI. Administrative Requirements

A. Executive Order 12866

This action has been classified as a Table 3 action for signature

by the Regional Administrator under the procedures published in the

Federal Register on January 19, 1989 (54 FR 2214-2225), as revised by a

July 10, 1995, memorandum from Mary Nichols, Assistant Administrator

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

exempted this regulatory action from E.O. 12866 review.

B. Regulatory Flexibility Act

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

EPAmust 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, the 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.

This Federal action authorizes and approves into the Kansas SIP

requirements previously adopted by the state, and imposes no new

requirements. Therefore, the Administrator certifies that it does not

have a significant impact on any small entities affected. Moreover, due

to the nature of the Federal-state relationship under the CAA,

preparation of a regulatory flexibility analysis would constitute

Federal inquiry into the economic reasonableness of state action. The

CAA forbids the 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)).

C. Unfunded Mandates

Under section 202 of the Unfunded Mandates Reform Act of 1995

signed into law on March 22, 1995, the EPA must prepare a budgetary

impact statement to accompany any proposed or final rule that includes

a Federal mandate that may result in estimated costs to State, local,

and tribal governments in the aggregate, or to private sector, of $100

million or more in any one year. Under section 205, the 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 the EPA to establish a plan for

informing and advising any small governments that may be significantly

or uniquely impacted by the rule.

The EPA has determined that the proposed action does not include a

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

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

to the private sector. This Federal action authorizes and approves into

the Kansas SIP requirements previously adopted by the state, and

imposes no new requirements. Accordingly, no additional costs to State,

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

this action.

List of Subjects in 40 CFR Part 52

Environmental protection, Air pollution control, Carbon monoxide,

Hydrocarbons, Incorporation by reference, Intergovernmental relations,

Lead, Nitrogen dioxide, Ozone, Particulate matter, Reporting and

recordkeeping requirements, Sulfur oxides, Volatile organic compounds.

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

Dated: March 14, 1997.

William Rice,

Acting Regional Administrator.

[FR Doc. 97-7348 Filed 3-21-97; 8:45 am]

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