Approval and Promulgation of Implementation Plans; California State Implementation Plan Revision, Ventura County Air Pollution Control District, Project XL Site-specific Rulemaking for Imation Corp. Camarillo Plant

ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[CA 229-0177; FRL-6433-9]

Approval and Promulgation of Implementation Plans; California

State Implementation Plan Revision, Ventura County Air Pollution

Control District, Project XL Site-specific Rulemaking for Imation Corp.

Camarillo Plant

AGENCY: Environmental Protection Agency (EPA).

ACTION: Proposed rule.

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

SUMMARY: The EPA is proposing to approve revisions to the California

State Implementation Plan (SIP) which concern the control of volatile

organic compound (VOC) emissions, and are applicable only to the

Imation Corp. facility in Camarillo, CA (Imation) as part of the EPA's

Imation XL Project. See 64 FR 37785, July 13, 1999. By this document,

EPA solicits comment on the proposed rule.

The intended effect of proposing approval of this rule is to

regulate emissions of VOCs in accordance with the requirements of the

Clean Air Act, as amended in 1990 (CAA or the Act) and to facilitate

implementation of the XL Project at Imation. Such implementation will

result in superior environmental performance and, at the same time,

provide Imation with greater operational flexibility.

EPA's final action on this proposed rule will incorporate the rule

into the federally approved SIP. EPA has evaluated this rule and is

proposing to approve it under provisions of the CAA regarding EPA

action on SIP submittals, SIPs for national primary and secondary

ambient air quality standards, and plan requirements for nonattainment

areas.

DATES: Comments must be received on or before October 8, 1999.

ADDRESSES: Comments. Written comments should be submitted in duplicate

to: David Albright, Permits Office (AIR-3), Air Division, U.S.

Environmental Protection Agency, Region IX, 75 Hawthorne Street, San

Francisco, CA 94105-3901.

Docket. A docket containing supporting information used in

developing this rulemaking, including copies of the State submittal,

the rule, and EPA's evaluation report of the rule are available for

public inspection and copying at U.S. EPA, Region IX, 75 Hawthorne

Street, San Francisco, CA during normal business hours. Copies of the

rule and related documents are also available for inspection at the

following location: Ventura County Air Pollution Control District, 669

County Square Drive, Ventura, CA.

FOR FURTHER INFORMATION CONTACT: David Albright, Permits Office (AIR-

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

Hawthorne Street, San Francisco, CA 94105-3901, (415) 744-1627 or

Daniel Reich, Office of Regional Counsel (RC-2-2), U.S. Environmental

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

94105-3901, (415) 744-1343. In addition, the proposed rule and

supporting documents are also available on the world wide web at the

following location: http://www.epa.gov/ProjectXL.

SUPPLEMENTARY INFORMATION:

I. Applicability

The rule being proposed for approval into the California SIP is

Ventura County Air Pollution Control District, VCAPCD, Rule 37

``Project XL.'' This rule was submitted by the California Air Resources

Board to EPA on July 30, 1999.

II. Background

The proposed California SIP revision is designed to implement a

pilot project developed under Project XL, an important EPA initiative

to allow regulated entities to achieve better environmental results at

less cost. Project XL--for ``eXcellence and Leadership''--was announced

on March 16, 1995, as a central part of the National Performance

Review's and EPA's effort to reinvent environmental protection. See 60

FR 27282 (May 23, 1995). In addition, on April 22, 1997, EPA modified

its guidance on Project XL, solicited new XL proposals, clarified EPA

definitions, and described changes intended to bring greater efficiency

to the process of developing XL projects. See 62 FR 19872 (April 22,

1997). The Imation XL Project was the subject of a recent Federal

Register notice announcing the proposed implementation of the project,

making available the proposed Final Project Agreement (FPA), and

soliciting public comment on the FPA and the project overall. See 64 FR

37785, July 13, 1999.

EPA is proposing SIP approval of Rule 37 under a procedure called

parallel processing, whereby EPA proposes rulemaking action

concurrently with the State's procedures for amending its

[[Page 48740]]

regulations. See 40 CFR part 51, appendix V. If the proposed revision

is substantially changed in areas other than those identified in the

proposed rulemaking, EPA will evaluate those changes and may publish

another proposed rule. If no substantial changes are made other than

those areas cited in the proposal, EPA will publish a final rulemaking

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

after the SIP revision has been adopted by California and submitted

formally to EPA for incorporation into the SIP. On August 23, 1999, EPA

reviewed Rule 37 for completeness and found that the rule conforms to

the completeness criteria in 40 CFR part 51, appendix V (criteria for

plans submitted explicitly for parallel processing).

The submitted rule authorizes Imation to implement a plantwide

applicability limit (PAL) for reactive organic compounds

(ROCs).1 The rule establishes conditions for setting,

evaluating, renewing, and complying with the VOC PAL. The rule also

establishes requirements for emission reduction credit (ERC) banking

and offsetting under the PAL, applying control technology, conducting

health risk assessments, and implementing any facility changes that are

pre-approved in Imation's part 70 permit. Finally, the rule exempts

Imation from District Rules 10 (Permits Required) and 26-26.10 (New

Source Review) for facility changes implemented in accordance with Rule

37.

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

\1\ The VCAPCD term reactive organic compound ``ROC'' is

functionally equivalent to EPA's term volatile organic compound

``VOC.'' In this document, the terms ``volatile organic compound''

and ``VOC'' are used.

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

III. EPA Evaluation and Proposed Action

The proposed SIP revision would establish an alternative approach

that would replace the VCAPCD New Source Review (NSR) program for new

and modified emission sources at Imation. The SIP revision, which is

only applicable to the operations at Imation, is a critical element of

the Imation XL Project as it will ensure that operations at the Imation

facility that are implemented in accordance with the XL project are not

in conflict with federally enforceable SIP requirements.

The proposed SIP revision is comprised of several of the most

critical terms and conditions from the proposed Imation Final Project

Agreement (FPA), a document that represents the intentions of all

parties to the XL Project agreement but that is not legally

enforceable. By incorporating these terms and conditions into a VCAPCD

rule that the VCAPCD Board adopts and which is approved into the SIP,

the main tenets of the FPA will be made enforceable by EPA, the State,

and citizens. A key element of the proposed SIP revision, and the

Imation XL project, is the authorization of a PAL for volatile organic

compounds (VOCs). The VOC PAL, a voluntary VOC emissions cap accepted

by Imation, is based on actual emissions and provides Imation with the

flexibility to add and modify emissions units below the PAL level

without triggering traditional new source review requirements. The

proposed revision also institutes several unique requirements and

procedures for operations at the facility, and exempts specified

Imation activities from two existing VCAPCD rules--Rule 10 (Permits

Required) and Rule 26 (New Source Review).

Section 110(a)(2)(C) of the Act requires state programs to

institute a preconstruction review program, generally referred to as

``minor NSR.'' VCAPCD's NSR program (See Rule 26) requires new source

review permitting for ``any new, replacement, modified, or relocated

emissions unit which would have a potential to emit any * * * Reactive

Organic Compounds.'' Such permitting under Rule 26 would typically

require BACT for any ROC emissions (no threshold) and offsets for ROC

emissions above 5 tpy. In order to provide Imation flexibility with

regard to Rule 26, EPA is today proposing approval of this source-

specific SIP revision that will apply only to the operations at

Imation. The source-specific SIP revision would exempt Imation from the

requirements of Rules 10 and 26, but require the source to keep their

emissions below the VOC PAL, apply California BACT 2 for

facility modifications, and follow specified procedures for adding new

equipment or modifying existing equipment. The requirements contained

in the source-specific SIP revision, in conjunction with Imation's

transfer of VOC emission reduction credits (ERCs) to the District,

assure that any new construction or equipment modification allowed

under the source's title V permit will be carried out in a manner that

is at least as environmentally protective as what would have been

required under Rules 10 and 26. EPA has prepared a Technical Support

Document (TSD) for this proposed rulemaking which further describes the

requirements of Rule 37 and EPA's evaluation of the rule. The TSD is

available as described in the Addresses and For Further Information

Contact sections of this document.

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

\2\ CA BACT, as defined in VCAPCD rules, is equivalent to

federally defined lowest achievable emissions rate (LAER).

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

EPA is proposing to approve the site-specific California SIP

revision for Imation, which was submitted on July 30, 1999. This

proposed plan revision is not intended to address any outstanding

issues with the Ventura County APCD NSR program that will be the

subject of a future EPA rulemaking on District Rule 26. EPA is

soliciting public comments on the issues discussed in this proposal or

on other relevant matters. These comments will be considered before

taking final action. Interested parties may participate in the Federal

rulemaking procedure by submitting written comments to the EPA Regional

office listed in the Addresses section of this action. Copies of the

proposed site-specific SIP revision and EPA's evaluation of the

revision are available in the docket for today's action and are also

available on the world wide web at http://www.epa.gov/ProjectXL.

The Agency has reviewed this request for revision of the Federally-

approved State implementation plan for conformance with the provisions

of the 1990 amendments enacted on November 15, 1990. The Agency has

determined that this action conforms with those requirements

irrespective of the fact that the submittal preceded the date of

enactment.

EPA has evaluated the submitted rule and has determined that it is

consistent with the CAA and EPA regulations. Therefore, Ventura County

APCD Rule 37--Project XL--is being proposed for approval under section

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

part D.

Nothing in this action should be construed as permitting or

allowing or establishing a precedent for any future implementation

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

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

environmental factors and in relation to the relevant statutory and

regulatory requirements.

IV. Administrative Requirements

A. Executive Order 12866

The Office of Management and Budget (OMB) has exempted this

regulatory action from Executive Order (E.O.) 12866, Regulatory

Planning and Review.

B. Executive Order 12875

Under Executive Order 12875, Enhancing the Intergovernmental

Partnership, EPA may not issue a regulation that is not required by

statute

[[Page 48741]]

and that creates a mandate upon a State, local or tribal government,

unless the Federal government provides the funds necessary to pay the

direct compliance costs incurred by those governments, or EPA consults

with those governments. If EPA complies by consulting, Executive Order

12875 requires EPA to provide to the Office of Management and Budget a

description of the extent of EPA's prior consultation with

representatives of affected State, local and tribal governments, the

nature of their concerns, copies of any written communications from the

governments, and a statement supporting the need to issue the

regulation. In addition, Executive Order 12875 requires EPA to develop

an effective process permitting elected officials and other

representatives of State, local and tribal governments ``to provide

meaningful and timely input in the development of regulatory proposals

containing significant unfunded mandates.'' Today's rule does not

create a mandate on State, local or tribal governments. The rule does

not impose any enforceable duties on these entities. Accordingly, the

requirements of section 1(a) of E.O. 12875 do not apply to this rule.

C. Executive Order 13045

Protection of Children from Environmental Health Risks and Safety

Risks (62 FR 19885, April 23, 1997), applies to any rule that: (1) is

determined to be ``economically significant'' as defined under E.O.

12866, and (2) concerns an environmental health or safety risk that EPA

has reason to believe may have a disproportionate effect on children.

If the regulatory action meets both criteria, the Agency must evaluate

the environmental health or safety effects of the planned rule on

children, and explain why the planned regulation is preferable to other

potentially effective and reasonably feasible alternatives considered

by the Agency. This rule is not subject to E.O. 13045 because it is

does not involve decisions intended to mitigate environmental health or

safety risks.

D. Executive Order 13084

Under Executive Order 13084, Consultation and Coordination with

Indian Tribal Governments, EPA may not issue a regulation that is not

required by statute, that significantly or uniquely affects the

communities of Indian tribal governments, and that imposes substantial

direct compliance costs on those communities, unless the Federal

government provides the funds necessary to pay the direct compliance

costs incurred by the tribal governments, or EPA consults with those

governments. If EPA complies by consulting, Executive Order 13084

requires EPA to provide to the Office of Management and Budget, in a

separately identified section of the preamble to the rule, a

description of the extent of EPA's prior consultation with

representatives of affected tribal governments, a summary of the nature

of their concerns, and a statement supporting the need to issue the

regulation. In addition, Executive Order 13084 requires EPA to develop

an effective process permitting elected officials and other

representatives of Indian tribal governments ``to provide meaningful

and timely input in the development of regulatory policies on matters

that significantly or uniquely affect their communities.'' Today's rule

does not significantly or uniquely affect the communities of Indian

tribal governments. Accordingly, the requirements of section 3(b) of

E.O. 13084 do not apply to this rule.

E. Regulatory Flexibility Act

The Regulatory Flexibility Act (RFA) generally requires an agency

to conduct a regulatory flexibility analysis of any rule subject to

notice and comment rulemaking requirements unless the agency certifies

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 small governmental

jurisdictions. This final rule will not have a significant impact on a

substantial number of small entities because SIP approvals under

section 110 and subchapter I, part D of the Clean Air 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

create any new requirements, I certify that this action will not have a

significant economic impact on a substantial number of small entities.

Moreover, due to the nature of the Federal-State relationship under the

Clean Air Act, preparation of 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. U.S. EPA, 427 U.S. 246, 255-66 (1976);

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

F. Paperwork Reduction Act

This action applies only to one company, and therefore requires no

information collection activities subject to the Paperwork Reduction

Act, and therefore no information collection request (ICR) will be

submitted to the Office of Management and Budget (OMB) for review in

compliance with the Paperwork Reduction Act, 44 U.S.C. 3501 et seq.

G. 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 promulgated 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.

List of Subjects in 40 CFR Part 52

Environmental protection, Air pollution control, Carbon monoxide,

Hydrocarbons, Intergovernmental relations, Nitrogen dioxide, Ozone,

Particulate matter, Reporting and recordkeeping requirements, Sulfur

oxides.

Dated: August 24, 1999.

David P. Howekamp,

Acting Regional Administrator, Region IX.

[FR Doc. 99-23280 Filed 9-7-99; 8:45 am]

BILLING CODE 6560-50-P