Approval and Promulgation of Implementation Plan; Wisconsin

ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[WI75-01-7304; FRL-5958-7]

Approval and Promulgation of Implementation Plan; Wisconsin

AGENCY: Environmental Protection Agency.

ACTION: Final rule.

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SUMMARY: The United States Environmental Protection Agency (USEPA)

proposed to approve Wisconsin's request to grant an exemption for the

Milwaukee severe and Manitowoc County moderate ozone nonattainment

areas from the applicable Oxides of Nitrogen (NOx) transportation

conformity requirements on June 12, 1997. The proposal was based on

information the Wisconsin Department of Natural Resource (WDNR)

submitted to the EPA as a State Implementation Plan (SIP) revision

request for an exemption under section 182(b)(1) of the Clean Air Act

(Act). The request was based on the urban airshed modeling (UAM)

conducted for the attainment demonstration for the Lake Michigan Ozone

Study (LMOS) modeling domain. The EPA is temporarily granting this

exemption until a control strategy SIP is approved.

DATES: This rule will be effective April 6, 1998.

ADDRESSES: Copies of the SIP revision, public comments and EPA's

responses are available for inspection at the following address:

Written comments should be sent to: Carlton T. Nash, Chief,

Regulation Development Section, Air Programs Branch (AR-18J), USEPA,

Region 5, 77 West Jackson Boulevard, Chicago, Illinois 60604-3590.

A copy of this SIP revision is available for inspection at the

following location:

Office of Air and Radiation (OAR) Docket and Information Center

(Air Docket 6102), room M1500, United States Environmental Protection

Agency, 401 M Street SW., Washington, DC 20460, (202) 260-7548.

FOR FURTHER INFORMATION CONTACT: Michael G. Leslie, Regulation

Development Section (AR-18J), Air Programs Branch, Air and Radiation

Division, United States Environmental Protection Agency, Region 5, 77

West Jackson Boulevard, Chicago, Illinois 60604, Telephone Number (312)

353-6680.

SUPPLEMENTARY INFORMATION:

I. Background

Clean Air Act section 176(c)(3)(A)(iii) requires, in order to

demonstrate conformity with the applicable SIP, that transportation

plans and Transportation Improvement Programs (TIPs) contribute to

emissions reductions in ozone and carbon monoxide nonattainment areas

during the period before control strategy SIPs are approved by USEPA.

This requirement is implemented in 40 CFR 51.436 through 51.440 (and

Sec. Sec. 93.122 through 93.124), which establishes the so-called

``build/no-build test.'' This test requires a demonstration that the

``Action'' scenario (representing the implementation of the proposed

transportation plan/TIP) will result in lower motor vehicle emissions

than the ``Baseline'' scenario (representing the implementation of the

current transportation plan/TIP). In addition, the ``Action'' scenario

must result in emissions lower than 1990 levels.

The November 24, 1993, final transportation conformity rule

1 does not require the build/no-build test and less-

[[Page 5461]]

than-1990 test for NOx as an ozone precursor in ozone nonattainment

areas, where the Administrator determines that additional reductions of

NOx would not contribute to attainment of the National Ambient Air

Quality Standard (NAAQS) for ozone. Clean Air Act section

176(c)(3)(A)(iii), which is the conformity provision requiring

contributions to emission reductions before SIPs with emissions budgets

can be approved, specifically references Clean Air Act section

182(b)(1). That section requires submission of State plans that, among

other things, provide for specific annual reductions of volatile

organic compounds (VOCs) and NOx emissions ``as necessary'' to attain

the ozone standard by the applicable attainment date. Section 182(b)(1)

further states that its requirements do not apply in the case of NOx

for those ozone nonattainment areas for which USEPA determines that

additional reductions of NOx would not contribute to ozone attainment.

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\1\ ``Criteria and Procedures for Determining Conformity to

State or Federal Implementation Plans of Transportation Plans,

Programs, and Projects Funded or Approved under Title 23 U.S.C. of

the Federal Transit Act'' November 24, 1993 (58 FR 62188).

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For ozone nonattainment areas, the process for submitting waiver

requests and the criteria used to evaluate them are explained in the

December 1993 USEPA document ``Guidelines for Determining the

Applicability of Nitrogen Oxides Requirements Under Section 182(f),''

and the May 27, 1994, and February 8, 1995, memoranda from John S.

Seitz, Director of the Office of Air Quality Planning and Standards, to

Regional Air Division Directors, titled ``Section 182(f) NOx

Exemptions--Revised Process and Criteria.''

On July 13, 1994, the States of Illinois, Indiana, Michigan, and

Wisconsin (the States) submitted to the USEPA a petition for an

exemption from the requirements of section 182(f) of the Clean Air Act

(Act). The States, acting through the Lake Michigan Air Directors

Consortium (LADCo), petitioned for an exemption from the Reasonably

Available Control Technology (RACT) and New Source Review (NSR)

requirements for major stationary sources of NOx. The petition also

asked for an exemption from the transportation and general conformity

requirements for NOx in all ozone nonattainment areas in the Region.

On March 6, 1995, the USEPA published a rulemaking proposing

approval of the NOx exemption petition for the RACT, NSR and

transportation and general conformity requirements. A number of

comments were received on the proposal. Several commenters argued that

NOx exemptions are provided for in two separate parts of the Act, in

sections 182(b)(1) and 182(f), but that the Act's transportation

conformity provisions in section 176(c)(3) explicitly reference section

182(b)(1). In April 1995, the USEPA entered into an agreement to change

the procedural mechanism through which a NOx exemption from

transportation conformity would be granted (EDF et al. v. USEPA, No.

94-1044, U.S. Court of Appeals, D.C. Circuit). Instead of a petition

under section 182(f), transportation conformity NOx exemptions for

ozone nonattainment areas that are subject to section 182(b)(1) now

need to be submitted as a SIP revision request. The Milwaukee and the

Manitowoc ozone nonattainment areas are classified as moderate or above

and, thus, are subject to section 182(b)(1).

The transportation conformity requirements are found at sections

176(c)(2), (3), and (4). The conformity requirements apply on an

areawide basis in all nonattainment and maintenance areas. The USEPA's

transportation conformity rule was amended on August 29, 1995 (60 FR

44762) to reference section 182(b)(1) rather than section 182(f) as the

means for exempting areas subject to section 182(b)(1) from the

transportation conformity NOx requirements.

The July 10, 1996, SIP revision request from Wisconsin was

submitted to meet the requirements in accordance with section

182(b)(1). Public hearings on this SIP revision request were held on

January 11 and 12, 1995.

In evaluating the section 182(b) SIP revision request, the USEPA

considered whether additional NOx reductions would contribute to

attainment of the standard in Milwaukee severe and Manitowoc County

moderate ozone nonattainment areas and also in the downwind areas of

the LMOS modeling domain.

As outlined in relevant USEPA guidance, the use of photochemical

grid modeling is the recommended approach for testing the contribution

of NOx emission reductions to attainment of the ozone standard. This

approach simulates conditions over the modeling domain that may be

expected at the attainment deadline for three emission reduction

scenarios: (1) Substantial VOC reductions; (2) substantial NOx

reductions; and (3) both VOC and NOx reductions. If the areawide

predicted maximum one-hour ozone concentration for each day modeled

under scenario (1) is less than or equal to those from scenarios (2)

and (3) for the corresponding days, the test is passed and the section

182(f) NOx emissions reduction requirements would not apply.

In making this determination under section 182(b)(1) that the NOx

requirements do not apply, or may be limited in the Lake Michigan area,

the USEPA has considered the National study of ozone precursors

completed pursuant to section 185B of the Act. The USEPA has based its

decision on the demonstration and the supporting information provided

in the SIP revision request.

II. Public Comments

On June 12, 1997, the EPA proposed approval of the Wisconsin

request to grant an exemption for the Milwaukee severe and Manitowoc

County moderate ozone nonattainment areas from the applicable Oxides of

Nitrogen (NOx) transportation conformity requirements. The EPA received

five sets of comments during the public comment period which ended on

July 14, 1997. Four of the comments where in favor of the EPA proposal,

and one set was critical of the proposal.

Comment: Wisconsin has failed to establish a NOx budget for these

ozone nonattainment areas. Wisconsin has yet to develop and submit such

budgets as required by November 1994. Until these attainment

demonstrations, encompassing verifiable and allocated (biogenic, point,

mobile, and area) NOx emission budgets, are submitted and complete, any

determination that required control strategies are not necessary is

premature and unfounded.

Response: The EPA acknowledges that the State has not submitted the

attainment demonstration as required, but EPA can process this SIP

revision without an attainment demonstration. As described in the

proposal, EPA is issuing this waiver on a temporary basis while more

detail modeling information is being developed and submitted.

Comment: The Wisconsin submittal failed to demonstrate that low-

level NOx reductions in the Milwaukee and Manitowoc nonattainment areas

would not improve air quality. While the submittal did analyze domain-

wide low level NOx reductions, no such analysis was performed for the

specific Wisconsin counties. The State of Wisconsin in coordination

with LADCo, has the capabilities to model NOx emissions from mobile

sources in these counties. The EPA should require such a demonstration

before taking final action on this rulemaking.

Response: The LADCo analysis demonstrated that across the board

reductions in NOx from point, area, and mobile sources would not

improve air quality in the modeling domain. Further, LADCo performed an

analysis which focused on NOx reductions from point sources. This

analysis showed a small increase in ozone formation. From

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this result LADCo concluded that low level NOx controls, i.e. mobile

and area sources, would be detrimental to air quality in the modeling

domain. The EPA accepts these conclusions.

Comment: The Wisconsin submittal failed to incorporate the LADCo

``Episode 4'' analysis. This episode represents meteorological

conditions with predominately east-to-west transport patterns. These

types of episodes will be important when assessing the revised NAAQS

eight hour exposure in Eastern Wisconsin. Areas such as Fox Valley and

Dane County, Wisconsin have already recorded eight hour average ozone

levels greater than 80 ppb.

Response: The EPA disagrees that Episode 4 was not incorporated

into Wisconsin's NOx waiver submittal. The August 22, 1994, EPA

technical review and the LADCo July 13, 1994, technical support

document for the NOx exemption modeling analysis clearly detail that

Episode 4 is included in the NOx waiver submittal. This episode

predicted that the highest domain-wide peak ozone concentrations occur

under the NOx-only reduction case. The modeling demonstration also

showed that NOx reductions are too limited to contribute to attainment

of the ozone standard.

Comment: Michigan Counties now in violation of the ozone NAAQS will

benefit from low-level NOx emissions reductions.

Response: Weather conditions which typically produce high levels of

ozone in the western Michigan area feature winds generally from the

south to southwest. NOx controls in Wisconsin have a minimal affect on

air quality in western Michigan during these high ozone episodes. The

LADCO modeling demonstrates that air quality benefits in western

Michigan occur primarily as a result of NOx controls in Illinois and

Indiana.

Comment: The EPA has failed to adequately consider the benefits of

NOx emissions reductions in the Milwaukee and Manitowoc nonattainment

areas.

Response: As stated above, the LADCo analysis demonstrated that

across-the-board reductions in NOx from point, area, and mobile sources

would not improve air quality in the modeling domain. Further, LADCo

performed an analysis which focused on NOx reductions from point

sources. This analysis showed a small increase in ozone formation. From

this result LADCo concluded that low level NOx controls, i.e. mobile

and area sources, would be detrimental to air quality in the modeling

domain. The EPA accepts these conclusions.

Comment: The EPA and Wisconsin failed to perform the appropriate

environmental justice analysis. The EPA has failed to consider the

spatial impact of where reductions could be anticipated and where

increases might occur with and without NOx conformity requirements in

Wisconsin.

Response: As discussed in the July 14, 1997, proposed approval, the

role that NOx emissions play in producing ozone at any given place and

time is complex. NOx primarily represents a sum of two oxides of

nitrogen, namely nitrogen oxide (NO) and nitrogen dioxide

(NO2). In the presence of sunlight, NO2 photo-

dissociates into NO and a single oxygen atom. The oxygen atom reacts

with molecular oxygen (O2) to form ozone (O3).

NO, on the other hand, near its source area readily reacts with ozone

to form O2 and NO2. The generated NO2

is then free to photo-dissociate and lead to ozone formation further

downwind. The reaction of NO with ozone, which locally reduces ozone

concentrations, is referred to as ozone scavenging and is one of the

primary local sinks for ozone in the lower atmosphere in and near NO

source areas. Since emissions of NOx from fuel combustion sources,

whether internal combustion engines or stationary combustion sources,

such as industrial boilers, contain significant amounts of NO, it is

expected that ozone concentrations immediately downwind of such NOx

sources will be reduced through ozone scavenging. Therefore, reducing

NOx emissions can lead to increased ozone concentrations in the

vicinity of the controlled NOx emission sources, whereas reducing NOx

emissions may lead to reduction in ozone concentrations further

downwind. Reducing NOx emissions in VOC-limited areas (areas with low

VOC emissions relative to NOx emissions) may produce minimal ozone

reductions or even ozone increases. This pattern of NOx scavenging is

demonstrated in the LADCo modeling. Therefore, controlling low level

NOx in Milwaukee area could in fact increase ozone concentrations in

local areas.

Comment: The Wisconsin request utilizes the BEIS-I inventory for

biogenics emissions. The Ozone Transport Assessment Group (OTAG)

concluded that the BEIS-II inventory is the preferred inventory for UAM

analyses.

Response: The BEIS-I was the approved and most appropriate biogenic

emissions inventory available to LADCo when the NOx model analysis was

performed. Any subsequent modeling performed by LADCo will utilize the

BEIS-II biogenic emissions inventory.

Comment: OTAG concluded, with Wisconsin's concurrence, that both

elevated and low level NOx reductions are effective in reducing ozone

levels. These conclusions were based extensively on OTAG modeling, and

are significant and relevant to EPA's action on this rule. The modeling

clearly demonstrated the efficacy of reducing low-level (mobile source)

NOx in controlling ozone. The conclusions of the policy group were that

such reductions were cost effective, and beneficial to reduce transport

to downwind areas.

Response: While EPA agrees in a general sense that OTAG recommended

NOx reductions from all source categories will reduce the transport of

ozone, it should be noted that OTAG concluded that States must have the

opportunity to conduct additional local and subregional modeling to

assess appropriateness, type, and timing of controls. OTAG further

concludes that States can work together, in coordination with EPA,

toward completing local SIPs including an evaluation of possible local

NOx disbenefits. The EPA believes that the specific modeling done by

LADCo should override OTAG's general findings as it pertains to NOx

disbenefits.

Comment: The OTAG concluded that ``disbenefit'' analyses found

ozone increases to be less frequent and severe than EPA concluded based

on the July 13, 1994, LADCo section 182(f) NOx waiver submittal, on

which the Wisconsin transportation conformity waiver is based.

Response: The OTAG-fine grid analysis utilized a 12 km grid as

compared to the LADCo fine grid of 4 km. This disparity in fine-grid

size de-emphasizes the NOx disbenefit at the local urbanized area. OTAG

concluded that some areas will experience local NOx disbenefits at more

frequent pronounced levels. The EPA believes that the LADCO fine-grid

analysis is more relevant than the waiver determination.

Comment: In previous rulemakings on similar NOx waiver requests,

EPA committed to incorporate the OTAG findings in ``future'' EPA

rulemakings. The OTAG has completed its analyses, and the EPA proposed

approval of Wisconsin's section 182(b) waiver is in direct conflict

with the OTAG's findings and EPA's commitment to utilize those

findings.

Response: The summary of the OTAG finding states that NOx

reductions decrease and increase ozone; decreases occur domain wide,

increases are confined to a few days in a few urban

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areas. These local increases are due mostly to low level urban NOx

reductions. These findings are consistent with the LADCo analysis for

this waiver.

The EPA's recently signed proposed regional NOx rulemaking uses the

OTAG findings to identify States which contribute significantly to

ozone problem areas in other States. In addition, the proposed

rulemaking establishes State-wide NOx budgets for the year 2007.

A section of the rulemaking also solicits comments on approaches

that can be used to address the disbenefit issue in areas such as Lake

Michigan. Subsequent modeling by the LADCo States will need to address

the disbenefit issue as it pertains to the NOx budget, ozone transport,

and attainment.

III. EPA Action

In this final action, EPA is approving the transportation

conformity NOx waiver SIP revision for the State of Wisconsin. In light

of the modeling completed thus far and considering the importance of

the Ozone Transport Assessment Group (OTAG) process and attainment plan

modeling efforts, EPA notes that it may reexamine the impact of this

NOx waiver. In the near future, EPA intends to require appropriate

States to submit SIP measures to achieve emissions reductions of ozone

precursors needed to prevent significant transport of ozone. The EPA

will evaluate Wisconsin's submitted SIP measures and available refined

modeling to determine whether the NOx waiver should remain in place, or

whether EPA will require a new plan revision.

The EPA also reserves the right to require NOx emission controls

for transportation sources under section 110(a)(2)(D) of the Act if

future ozone modeling demonstrates that such controls are needed to

achieve the ozone standard in downwind areas.

IV. Miscellaneous

A. Applicability to Future SIP Decisions

Nothing in this action should be construed as permitting, allowing

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

SIP. The EPA shall consider each request for revision to the SIP in

light of specific technical, economic, and environmental factors and in

relation to relevant statutory and regulatory requirements.

B. Executive Order (E.O.) 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 has exempted

this regulatory action from E.O. 12866 review.

C. Regulatory Flexibility

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 economic 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 Act

do not create any new requirements but simply approve requirements that

the State is already imposing. Therefore, because the Federal SIP

approval does not impose any new requirements, 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 Act, preparation of a flexibility analysis 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. EPA, 427 U.S. 246, 255-66 (1976); 42

U.S.C. 7410(a)(2).

D. Unfunded Mandates Reform Act

Under section 202 of the Unfunded Mandates Reform Act of 1995

(``Unfunded Mandates Act''), 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 of $100 million or more to State, local, or tribal governments in

the aggregate; or to the private sector, of $100 million or more. 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 approval action promulgated 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 approves

preexisting 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.

E. Submission to Congress and the General Accounting Office

Under 5 U.S.C. 801(a)(1)(A) as added by the Small Business

Regulatory Enforcement Fairness Act of 1996, the EPA submitted a report

containing this rule and other required information to the U.S. Senate,

the U.S. House of Representatives, and the Comptroller General of the

General Accounting Office prior to publication of this rule in the

Federal Register. This rule is not a ``major rule'' as defined by 5

U.S.C. 804(2)

F. Petitions for Judicial Review

Under section 307(b)(1) of the Act, petitions for judicial review

of this action must be filed in the United States Court of Appeals for

the appropriate circuit by April 6, 1998. Filing a petition for

reconsideration by the Administrator of this final rule does not affect

the finality of this rule for the purposes of judicial review, nor does

it extend the time within which a petition for judicial review may be

filed, and shall not postpone the effectiveness of such rule or action.

This action may not be challenged later in proceedings to enforce its

requirements. (See section 307(b)(2).)

List of Subjects in 40 CFR Part 52

Environmental protection, Air pollution control, Hydrocarbons,

Intergovernmental relations, Ozone, Oxides of Nitrogen, Transportation

conformity, Transportation-air quality planning, Volatile organic

compounds.

Dated: January 22, 1998.

David A. Ullrich,

Acting Regional Administrator, Region V.

40 CFR part 52 is amended as follows:

PART 52--[AMENDED]

1. The authority citation for part 52 continues to read as follows:

Authority: 42 U.S.C 7401 et seq.

Subpart YY--Wisconsin

2. Section 52.2585 is amended by adding paragraph (m) to read as

follows:

Sec. 52.2585 Control strategy: Ozone.

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(m) Approval--On July 10, 1996, the Wisconsin Department of Natural

Resources submitted a revision to the ozone State Implementation Plan.

The submittal pertained to a request to waive the Oxide of Nitrogen

requirements for transportation conformity in the Milwaukee and

Manitowoc ozone nonattainment areas.

[FR Doc. 98-2616 Filed 2-2-98; 8:45 am]

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