Protection of Stratospheric Ozone: Allocation of 2000 Essential Use Allowances

ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 82

[FRL-6467-7]

RIN 2060-AI73

Protection of Stratospheric Ozone: Allocation of 2000 Essential

Use Allowances

AGENCY: Environmental Protection Agency (EPA).

ACTION: Notice of proposed rulemaking.

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SUMMARY: With this action, EPA is proposing the allocation of

essential-use allowances for ozone depleting substances (ODS) for the

2000 control period. The United States nominated specific uses of

controlled ozone-depleting substances (ODS) as essential for 2000 under

the Montreal Protocol on Substances that Deplete the Ozone Layer

(Protocol). The Parties to the Protocol subsequently authorized

specific quantities of ODS for 2000 for the uses nominated by the

United States. Essential use allowances permit a person to obtain

controlled ozone-depleting substances as an exemption to the January 1,

1996 regulatory phaseout of production and import. EPA allocates

essential use allowances to a person for exempted production or

importation of a specific quantity of a controlled substance solely for

the designated essential purpose.

DATES: Written comments on this proposed rule must be received on or

before December 2, 1999, unless a public hearing is requested. Comments

must then be received on or before 30 days following the public

hearing. Any party requesting a public hearing must notify the

Stratospheric Ozone Protection Hotline listed below by 5 p.m. Eastern

Standard Time on November 12, 1999. If a hearing is held, EPA will

publish a document in the Federal Register announcing the hearing

information.

ADDRESSES: Comments on this rulemaking should be submitted in duplicate

(two copies) to: Air Docket No. A-92-13, U.S. Environmental Protection

Agency, 401 M Street, SW., Room M-1500, Washington, DC 20460. Inquiries

regarding a public hearing should be directed to the Stratospheric

Ozone Protection Hotline at 1-800-269-1996.

Materials relevant to this rulemaking are contained in Docket No.

A-92-13. The Docket is located in room M-1500, First Floor, Waterside

Mall at the address above. The materials may be inspected from 8 a.m.

until 4 p.m. Monday through Friday. A reasonable fee may be charged by

EPA for copying docket materials.

FOR FURTHER INFORMATION CONTACT: The Stratospheric Ozone Protection

Hotline at 1-800-296-1996 or Erin Birgfeld, U.S. Environmental

Protection Agency, Stratospheric Protection Division, Office of

Atmospheric Programs, 6205J, 401 M Street, SW., Washington, DC, 20460,

202-564-9079.

SUPPLEMENTARY INFORMATION:

Table of Contents

I. Background

II. Allocation of 2000 Essential Use Allowances

III. Summary of Supporting Analysis

A. Unfunded Mandates Reform Act

B. Executive Order 12875: Enhancing the Intergovernmental

Partnership

C. Executive Order 12866

D. Paperwork Reduction Act

E. Executive Order 13084: Consultation and Coordination With

Indian Tribal Governments

F. Regulatory Flexibility Act

G. Executive Order 13045: Protection of Children from

Environmental Health Risks and Safety Risks

H. National Technology Transfer and Advancement Act

I. Federalism

I. Background

How Are Essential Use Exemptions for Ozone-Depleting Substances

Approved at the International Level?

The Montreal Protocol on Substances that Deplete the Ozone Layer

(Protocol) sets specific deadlines for the phaseout of production and

importation of ozone depleting substances (ODS). At their Fourth

Meeting in 1992, the signatories to the Protocol (the Parties) amended

the Protocol to allow exemptions to the phaseout for uses agreed by the

Parties to be essential. At the same Meeting, the Parties also adopted

Decision IV/25, which established criteria for determining whether a

specific use should be approved as essential, and the process for

making such a determination.

The criteria for an essential use as set forth in Decision IV/25

are the following:

``(1) that a use of a controlled substance should qualify as

`essential' only if:

(i) it is necessary for the health, safety or is critical for the

functioning of society (encompassing cultural and intellectual

aspects); and

(ii) there are no available technically and economically feasible

alternatives or substitutes that are acceptable from the standpoint of

environment and health;

(2) that production and consumption, if any, of a controlled

substance for essential uses should be permitted only if:

(i) all economically feasible steps have been taken to minimize the

essential use and any associated emission of the controlled substance;

and

(ii) the controlled substance is not available in sufficient

quantity and quality from existing stocks of banked or recycled

controlled substances, also bearing in mind the developing

[[Page 59142]]

countries' need for controlled substances.''

The procedure set out by Decision IV/25 first calls for individual

Parties to nominate essential uses. The Protocol's Technology and

Economic Assessment Panel (TEAP or the Panel) evaluates the nominated

essential uses and makes recommendations to the Protocol Parties. The

Parties make the final decisions on essential use nominations at their

annual meeting.

What Are the Essential Uses That EPA Has Nominated in the Past?

Decision IV/25 was implemented initially in the context of halons

which were phased out of production at the end of 1993. At that time,

nominations for halons were separated from those for other ozone-

depleting substances. EPA issued a Federal Register notice requesting

nominations for essential uses of halons (February 2, 1993; 58 FR

06786). In response, the Agency received over ten nominations, but was

able to work with applicants to resolve their near-term requirements.

As a result, the U.S. did not nominate any uses for continued halon

production in 1994. About a dozen other nations put forth nominations

which were reviewed by the Panel, which determined that in each case

alternatives existed or that the existing supply of banked halons was

adequate to meet near-term needs. The Panel, therefore, did not

recommend approval for any of the nominations. In November of 1993, at

the Fifth Meeting, the Parties unanimously adopted the Panel's

recommendation not to approve any essential uses for production and

consumption of halons in 1994.

EPA issued a second notice requesting applications for essential

use applications for halons for the 1995 control period on October 18,

1993 (58 FR 53722). In response to this inquiry, EPA received no

applications. The TEAP received only one nomination (from France) for

essential use exemptions for halons for production and consumption of

halons for an essential use in 1995. The TEAP did not recommend

approval of this nomination.

In 1993, EPA issued a Federal Register notice requesting essential

use applications for CFCs, methyl chloroform, carbon tetrachloride, and

hydrobromofluorocarbons required beyond the 1996 phaseout of

consumption and production of these class I substances (May 20, 1993,

58 FR 29410). EPA received 20 applications in response to this notice.

For several of these applications, EPA determined that the criteria

contained in Decision IV/25 had not been satisfied. For example, EPA

rejected two applications seeking CFCs for use in servicing air-

conditioning equipment on the basis that adequate supplies of banked

and recycled CFCs were available. However, in rejecting these

nominations, the United States noted that servicing existing air-

conditioning and refrigeration equipment remains a major challenge to

the successful transition from ODSs and that a future nomination in

this area might be necessary if a combination of retrofits,

replacements, recycling, recovery at disposal, and banking do not

adequately address these needs.

In 1993, the United States forwarded essential use nominations to

the Protocol Secretariat for the following uses of CFCs: metered dose

inhalers and other selected medical applications; rocket motor assembly

for the Space Shuttle; aerosol wasp killers; limited use in a specified

bonding agent and polymer application; and a generic application for

laboratory uses under specified limitations. (Letter from Pomerance to

UNEP, September 27, 1993).

The TEAP reviewed over 200 specific uses which were submitted to

the Montreal Protocol Secretariat by the Parties to the Protocol. In

March 1994, the Panel issued the ``1994 Report of the Technology and

Economic Assessment Panel,'' which included the Panel's recommendations

for essential-use production and consumption exemptions. The Panel

recommended that essential use exemptions be granted for nominations

of: methyl chloroform in solvent bonding for the Space Shuttle; CFCs

used in metered dose inhalers; and specific controlled substances

needed for laboratory and analytical applications. For each of the

other nominations submitted, the TEAP determined that one or more of

the criteria for evaluating an essential use had not been satisfied.

The Parties approved essential use exemptions for the uses recommended

in the 1994 TEAP report. The U.S. has continued to request and receive

exemptions for those same uses in subsequent years.

Have There Been Any Recent Changes to the Essential Use Process at the

International Level?

At the Eighth Meeting of the Parties in 1996, a new timetable for

nomination of essential uses was established in Decision VIII/9. This

Decision states that Parties may nominate a controlled substance for an

exemption from the production and consumption phaseout by January 31 of

each year to the Ozone Secretariat. EPA has since issued Federal

Register notices calling for essential use applications for class I

controlled substances prior to the Protocol deadline for submission to

the Ozone Secretariat.

Decision V/18 directed the Technology and Economic Assessment Panel

to develop a ``handbook on essential use nominations'' (Handbook). The

July 1994 Handbook contained forms and instructions for how to apply

for an essential-use exemption. Subsequent decisions by the Parties to

the Protocol created additional criteria for essential use

authorizations now reflected in the August 1997 Handbook on Essential

Use Nominations. The Handbook may be obtained from the Stratospheric

Protection Division, U.S. Environmental Protection Agency or the Ozone

Secretariat of the Montreal Protocol in Nairobi. The Handbook can also

be downloaded from the TEAP website at: http://www.teap.org/html/teap_

reports.html.

What Does EPA Do With the Information in the Essential Use

Applications?

The U.S. EPA carefully reviews all the information in each

essential use application to ensure that it contains complete

information in accordance with the Decisions of the Protocol Parties as

reflected in the Handbook. EPA enters the information from each

application into a tracking system which permits year by year

comparison of quantities of ODS requested, quantities allocated,

quantities of ODS received in previous years, and quantities of ODS

used for the specific essential activity. The review of data enables

EPA to assess whether entities are stockpiling ODS, whether there seems

to be inflated requests relative to actual use, and whether there is

possible double-counting between companies. For example, in 1998 we

identified some double-counting in the requests for CFCs among

companies. Our analysis also revealed that there were disparities

between the total quantity of CFCs requested for MDIs and the actual

quantity used to manufacture MDIs in previous years. To account for

this inflation in the request for allocation, EPA reduced the total

U.S. nomination for 1998 by 10 percent before forwarding them for

consideration by the TEAP and the Parties to the Protocol.

EPA recognizes that since companies must project their need for

CFCs almost two years in advance, the actual needs of a company may

change in the interim. Therefore, prior to allocation, EPA consults

with companies to ensure they still require the total amount of ODS

requested. For example, in 1999

[[Page 59143]]

several essential use applicants voluntarily indicated that they would

not require the total quantity of ODSs requested in their original

application submitted to EPA.

Every year since 1994, EPA has reviewed applications for essential

uses according to the above criteria and then forwarded the

applications to the Parties. The Parties then review the

recommendations by the Technology and Economic Assessment Panel and

make final decisions on essential use nominations. Today's action

follows decisions taken by the Parties after considering

recommendations by the TEAP in 1998 and 1999.

II. Allocation of 2000 Essential Use Allowances

What Is EPA's Proposed Essential Use Allocation for the Year 2000?

In today's action, EPA is proposing allocation of essential use

allowances for the 2000 control period to entities listed in Table I

for exempted production or import of the specific quantity of class I

controlled substances solely for the specified essential use.

Table I.--Essential Uses Agreed to by the Parties to the Protocol for

2000 and Essential Use Allowances

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

Quantity

Company Chemical (metric

tonnes)

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

(i) Metered Dose Inhalers for Treatment of Asthma and Chronic

Obstructive Pulmonary Disease

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International Pharmaceutical Aerosol CFC-11 588.0

Consortium (IPAC)--Medeva Americas, CFC-12 1516.0

Inc., Boehringer Ingelheim CFC-114 301.0

Pharmaceuticals, Glaxo Wellcome,

Rhone-Poulenc Rorer, 3M.

Medisol Laboratories, Inc............ CFC-11 70.0

CFC-12 120.0

CFC-114 10.0

Schering Corporation................. CFC-11 330.0

CFC-12 680.0

Sciarra Laboratories, Inc............ CFC-11 25.0

CFC-12 75.0

CFC-114 20.0

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(ii) Cleaning, Bonding and Surface Activation Applications for the Space

Shuttle Rockets and Titan Rockets

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National Aeronautics and Space Methyl Chloroform 56.7

Administration (NASA)/Thiokol Rocket.

United States Air Force/Titan Rocket. Methyl Chloroform 3.4

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

(iii) Laboratory and Analytical Applications

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Global Exemption (Restrictions in Class I Controlled (\1\)

Appendix G Apply). Substances excluding

CFCs, carbon

tetrachloride,

halons, and HBFCs

(hydrobromoflouro

carbons)

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

\1\ No quantity specified.

The International Pharmaceutical Aerosol Consortium (IPAC)

consolidated the essential use exemption requests of its member

companies for administrative convenience. EPA will separately allocate

essential-use allowances to each of IPAC's member companies.

In developing today's action, EPA considered allocating essential-

use allowances in accordance with Decision X/6 of the Parties to the

Montreal Protocol. Paragraph 2 of Decision X/6 states that the ``levels

of production and consumption necessary to satisfy essential uses of

CFC-11, CFC-12, CFC-113, and CFC-114, for metered-dose inhalers for

asthma and chronic obstructive pulmonary diseases...are authorized as

specified in annex I to the report of the Tenth Meeting of the

Parties.'' Paragraph 5 of Decision X/6 goes on to say that ``the

quantities approved under paragraph 2 above and all future approvals

are for total CFC volumes with flexibility between CFCs within each

group.'' Thus, EPA is considering allocating essential-use allowances

for CFCs for the manufacture of metered-dose inhalers in the aggregate

instead of on a compound-by-compound basis and seeks comments on this

option. CFC-11, CFC-12 and CFC-114 all have an ozone depleting

potential of 1.0, so an aggregate allocation of essential-use

allowances for all these CFCs would add some flexibility for protecting

patient health by allowing companies to better meet market demand for

MDIs without causing additional damage to the stratospheric ozone

layer.

How Did EPA Determine the Proposed Essential Use Allocation?

Applications submitted by the entities in Table I requested class I

controlled substances for uses deemed essential for the 2000 control

period. The applications provided information in accordance with the

criteria set forth in Decision IV/25 of the Protocol and the procedures

outlined in the ``1997 Handbook on Essential Use Nominations.'' The

applications requested exemptions for the production and import of

specific quantities of specific class I controlled substances after the

phaseout as set forth in 40 CFR 82.4. The U.S. government reviewed the

applications and nominated these uses to the Protocol Secretariat for

analysis by the Technical and Economic Assessment Panel (TEAP) and its

Technical Option Committees (TOCs). The Parties to the Montreal

Protocol approved the U.S. nominations for essential-use exemptions

during the Tenth Meeting in 1998 (Decision IX/18). Today's action

proposes the allocation of essential-use allowances to U.S. entities as

authorized by the Parties to the Protocol and consistent with the Clean

Air Act.

Does the Clean Air Act Permit Production and Import of Ozone-Depleting

Substances for Essential Uses?

The Clean Air Act provides specific exemptions to the phaseout of

ozone-depleting substances; unlike the Protocol, it does not provide

for an open-ended essential use process. Thus, a use that is permitted

under the Protocol may or may not be permitted under the Act. However,

the Act's phaseout schedule for class I substances (except for methyl

bromide) in Section 604 is less stringent than the Protocol phaseout

schedule. For example, in 1999, three years after the phaseout of CFCs

under the Protocol, the Act allows production of 15 percent of the

baseline. (Note, however, that under EPA's regulations, the CFC

phaseout date is the same as that under the Protocol in accordance with

section 606 and 614(b) of the Act.) Thus, for the past several years,

EPA has been able to authorize production and import of ozone-depleting

substances for essential uses allowed under the Protocol, without

regard to whether the Act contains exceptions for those uses, as long

as the total authorized production does not exceed the amount permitted

by the Act. However, January 1, 2000 is the phaseout date under Section

604 of the Act for all class I substances with the exception of methyl

chloroform and

[[Page 59144]]

methyl bromide. The phaseout dates for methyl chloroform and methyl

bromide are January 1, 2002 and January 1, 2005, respectively. After

the phaseout date for a particular substance has passed, EPA will no

longer be able to authorize production of that substance on the basis

of the slower phaseout schedule under the Act.

The Act's provision for specific exemptions includes the following.

Section 604 (d)(2) of the Act states that notwithstanding the phaseout,

EPA shall, to the extent consistent with the Montreal Protocol,

authorize production of limited quantities of class I substances for

use in medical devices, if FDA, in consultation with EPA, determines

that such production is necessary. Section 604(d)(3) states that EPA

may, to the extent consistent with the Montreal Protocol, authorize

production of limited quantities of halon-1211, halon-1301, and halon-

2402 solely for the purpose of aviation safety, if the Federal Aviation

Administration, in consultation with EPA, determines that no safe and

effective substitute has been developed and that such authorization is

necessary for aviation safety purposes. Section 604(d)(1) provides that

during the period from January 1, 1992 to January 1, 2005, EPA may, to

the extent consistent with the Montreal Protocol, authorize the

production of limited quantities of methyl chloroform solely for use in

essential applications for which no safe and effective substitute is

available. Section 604(d)(4) states that EPA cannot use any of these

three exemptions to authorize any person to produce a class I substance

in annual quantities greater than 10 percent of that person's baseline

year as defined in Section 601(2). Section 604(g)(3) of the Act

provides that EPA may, to the extent consistent with the Montreal

Protocol, authorize the production of limited quantities of halon-1211,

halon-1301, and halon-2402 after December 31, 1999 and before December

31, 2004 for use in fire suppression and explosion prevention in

association with domestic production of crude oil and natural gas

energy supplies on the North Slope of Alaska, if it is determined that

no safe and effective substitute has been developed and that such

authorization is necessary for fire suppression or explosion prevention

purposes. EPA cannot use this exemption to authorize any person to

produce any of these halons in an amount greater than 3 percent of that

person's baseline. Finally, section 604(f) states that the President

may, to the extent consistent with the Montreal Protocol, provide an

exemption for production of CFC -114, halon-1211, halon-1301, and

halon-2402 as necessary to protect U.S. national security interests, if

the President finds that adequate substitutes are not available and

that the production and use of the substance are necessary to protect

national security interests.

How Does the Allocation for the Year 2000 Differ From 1999 and Previous

Years?

Each year, the Parties to the Protocol have approved an unlimited,

global essential use exemption for the production and consumption of

high purity ozone depleting substances for use in laboratory and

analytical techniques. EPA has implemented this exemption domestically

through regulation. However, beginning January 1, 2000 EPA may no

longer be able to allow laboratory essential use exemptions for most

Class I substances because the Act does not specifically list

laboratory and analytical uses as an exception to the phaseout. Thus,

as of January 1, 2000, EPA may no longer be able to grant laboratory

essential use exemptions for CFCs, halons, carbon tetrachloride, or

HBFCs, because the phaseout date under the Act for these substances is

January 1, 2000. It should be noted, however, that EPA believes that

the ban would apply only to the import and production of these class I

ODSs and would not apply to their actual use in the laboratory.

Therefore, EPA believes that laboratories could continue to use

stockpiles of class I ODSs that were produced or imported prior to

January 1, 2000. Trade among companies of class I ODSs that were

produced or imported for laboratory uses prior to January 1, 2000 would

be permitted. The supply of this subset of class I ODSs (which includes

CFCs and carbon tetrachloride) after this date however, would be

finite, and once domestic stockpiles are depleted, laboratories would

cease to have access to these chemicals. EPA solicits comment on the

above interpretation and other possible interpretations of the

statutory requirements related to EPA's ability to grant essential use

exemptions for laboratory and analytical uses.

For the year 2000, EPA is implementing the exception for medical

devices found in section 604(d)(2) of the Clean Air Act. ``Medical

device'' is defined in section 601(8) of the Clean Air Act as follows:

[A]ny device (as defined in the Federal Food, Drug, and Cosmetic

Act (21 U.S.C. 321), diagnostic product, drug (as defined in the

Federal Food, Drug, and Cosmetic Act), and drug delivery system--

[A] if such device, product, drug, or drug delivery system

utilizes a class I or class II substance for which no safe and

effective alternative has been developed, and where necessary,

approved by the Commissioner [of FDA]; and

[B] if such device, product, drug, or drug delivery system, has,

after notice and opportunity for public comment, been approved and

determined to be essential by the Commissioner [of FDA] in

consultation with the Administrator [of EPA].

EPA and FDA are discussing how best to interpret the above

definition of ``medical device.'' With respect to part (A) of the

definition (section 601(8)(A)), which relates to ``safe and effective

alternative[s]'', the preamble to FDA's September 1, 1999 notice of

proposed rulemaking on essential use determinations (64 FR 47735)

discusses FDA's approach to determining whether ``safe and effective

alternative[s]'' have been developed. FDA's preamble points out, and

EPA agrees, that ``A non-CFC product simply having the same active

moiety as a CFC product is only one factor to be considered. Other

factors, such as whether the non-CFC product has the same route of

administration, the same indication, and can be used with approximately

the same level of convenience, are important considerations.

Additionally, FDA must consider whether patients who medically need the

CFC product are adequately served by the non-CFC product...FDA's

approval of a non-CFC product is a determination that the product is

safe and effective, but it is not a determination that the product is a

safe and effective alternative to any other product. That requires a

separate and distinct analysis.''

With respect to part (B) of the definition of medical device

(section 601(8)(B)), and in particular the use of the word

``essential'' in that part of the definition, EPA proposes to rely on

current FDA regulations (21 CFR 2.125) which contain a list of uses of

CFCs that FDA in consultation with EPA has found to be essential. This

list includes, among others, metered-dose steroids, metered-dose

adrenergic bronchodilators, metered-dose cromolyn sodium, metered-dose

ipratropium bromide, and metered-dose nedocromil sodium, all drugs for

oral inhalation in humans. The companies for which EPA is proposing to

grant essential use allowances produce MDIs that are covered by one of

the categories on FDA's essential use list. Thus, the products for

which EPA is proposing to provide essential use allowances belong to

the product categories ``determined to be essential'' by FDA.

Also with respect to part (B) of the definition of ``medical

device'', EPA and

[[Page 59145]]

FDA are discussing at least two interpretations of the language

regarding approval by FDA of the ``device, product, drug, or drug

delivery system.'' First, one could interpret the word ``approved'' as

referring to FDA's approval of the specific product in question through

approval of the New Drug Application (NDA) or Abbreviated New Drug

Application (ANDA) for that product. Alternatively, one could interpret

it as referring to FDA's approval of the same active moiety under that

or any other NDA or ANDA. (FDA regulation at 21 CFR.108(a) defines

active moiety as ``the molecule or ion excluding those appended

portions of the molecule that cause the drug to be an ester, salt

(including a salt with hydrogen or coordination bonds), or other

noncovalent derivatives (such as a complex, chelate or clathrate) of

the molecule, responsible for the physiological or pharmacological

action of the drug substance.'')

The implications of adopting the first interpretation described

above, would require EPA to have more information regarding product

approvals. The 1997 TEAP Handbook on Essential Use Nomination is the

guidance document used for application for essential use exemptions.

Because this Handbook does not request companies to specifically list

the products for which the CFCs will be used, EPA does not have the

information necessary to determine whether the products are in fact

``approved'' by FDA. Therefore, EPA has sent out formal requests for

this additional information under section 114 of the Act to the

pharmaceutical companies who requested CFCs for the year 2000. If the

first interpretation is adopted, EPA will analyze the data received

from these letters and will not allocate CFCs in the final rule for

those individual products that are not approved by FDA. The allocation

in this proposed rule represents the amount allocated by the Parties to

the Montreal Protocol at the Tenth Meeting of the Parties, and may be

reduced in the final rule.

As stated earlier, section 604(d)(2) of the Act provides that EPA

shall authorize production and import of limited quantities of class I

substances for use in medical devices if FDA, in consultation with EPA,

determines such authorization to be necessary. EPA and FDA are now

discussing appropriate approaches to implementing the essential use

exemption for medical devices. EPA's final essential use allocation for

the year 2000 will be based on what FDA determines is ``necessary''

under section 604(d)2 of the Act.

The phaseout date for methyl chloroform under the Act is January 1,

2002. Until that date, the Act permits production and import of methyl

chloroform equivalent to 20% of baseline. The amount of methyl

chloroform allocated for 2000 is well below this limit. Beginning in

the year 2002, EPA will implement the exception for essential uses of

methyl chloroform found in 604(d)(1) of the Act.

What Reporting Requirements Must Be Followed for the Essential Uses of

Ozone Depleting Substances?

Any person obtaining class I controlled substances after the

phaseout under the essential use exemptions proposed in today's action

would be subject to all the restrictions and requirements in other

sections of 40 CFR part 82, subpart A. Holders of essential-use

allowances or persons obtaining class I controlled substances under the

essential-use exemptions must comply with the record keeping and

reporting requirements in 40 CFR 82.13.

III. Summary of Supporting Analysis

A. Unfunded Mandates Reform Act

Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), Public

Law 104-4, establishes requirements for Federal agencies to assess the

effects of their regulatory actions on State, local, and tribal

governments and the private sector.

Under section 202 of the UMRA, EPA generally must prepare a written

statement, including a cost-benefit analysis, for proposed and final

rules with ``Federal mandates'' that may result in expenditures by

State, local, and tribal governments, in the aggregate, or by the

private sector, of $100 million or more in any one year. Before

promulgating an EPA rule for which a written statement is needed,

section 205 of the UMRA generally requires EPA to identify and consider

a reasonable number of regulatory alternatives and adopt the least

costly, most cost-effective or least burdensome alternative that

achieves the objectives of the rule. The provisions of section 205 do

not apply when they are inconsistent with applicable law. Moreover,

section 205 allows EPA to adopt an alternative other than the least

costly, most cost-effective or least burdensome alternative if the

Administrator publishes with the final rule an explanation why that

alternative was not adopted. Section 204 of the UMRA requires the

Agency to develop a process to allow elected state, local, and tribal

government officials to provide input in the development of any

proposal containing a significant Federal intergovernmental mandate.

Before EPA establishes any regulatory requirements that may

significantly or uniquely affect small governments, including tribal

governments, it must have developed under section 203 of the UMRA a

small government agency plan. The plan must provide for notifying

potentially affected small governments, enabling officials of affected

small governments to have meaningful and timely input in the

development of EPA regulatory proposals with significant Federal

intergovernmental mandates, and informing, educating, and advising

small governments on compliance with the regulatory requirements.

Today's rule contains no Federal mandates (under the regulatory

provisions of Title II of the UMRA) for State, local, or tribal

governments or the private sector. Because this proposed rule imposes

no enforceable duty on any State, local or tribal government it is not

subject to the requirements of sections 202 and 205 of the UMRA. EPA

has also determined that this rule contains no regulatory requirements

that might significantly or uniquely affect small governments;

therefore, EPA is not required to develop a plan with regard to small

governments under section 203. Finally, because this proposal does not

contain a significant intergovernmental mandate, the Agency is not

required to develop a process to obtain input from elected state,

local, and tribal officials under section 204.

B. Executive Order 12875: Enhancing the Intergovernmental Partnership

Under Executive Order 12875, EPA may not issue a regulation that is

not required by statute 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 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

[[Page 59146]]

regulatory proposals containing significant unfunded mandates.''

Today's proposed rule does not create a mandate on State, local or

tribal governments. The proposed rule does not impose any enforceable

duties on these entities. Accordingly, the requirements of section 1(a)

of Executive Order 12875 do not apply to this proposed rule.

C. Executive Order 12866

Under Executive Order 12866 (58 FR 51735, October 4, 1993), the

Agency must determine whether this regulatory action is ``significant''

and therefore subject to OMB review and the requirements of the

Executive Order. The Order defines ``significant'' regulatory action as

one that is likely to result in a rule that may:

(1) have an annual effect on the economy of $100 million or more,

or adversely affect in a material way the economy, a sector of the

economy, productivity, competition, jobs, the environment, public

health or safety, or State, local, or tribal governments or

communities;

(2) create a serious inconsistency or otherwise interfere with an

action taken or planned by another agency;

(3) materially alter the budgetary impact of entitlements, grants,

user fees, or loan programs or the rights and obligations of recipients

thereof; or

(4) raise novel legal or policy issues arising out of legal

mandates, the President's priorities, or the principles set forth in

the Executive Order.

It has been determined that this rule is not a ``significant

regulatory action'' under the terms of Executive Order 12866 and is

therefore not subject to OMB review.

D. Paperwork Reduction Act

This action does not add any information collection requirements or

increase burden under the provisions of the Paperwork Reduction Act, 44

U.S.C. 3501 et seq. The Office of Management and Budget (OMB)

previously approved the information collection requirements contained

in the final rule promulgated on May 10, 1995, and assigned OMB control

number 2060-0170 (EPA ICR No. 1432.16).

Burden means the total time, effort, or financial resources

expended by persons to generate, maintain, retain, or disclose or

provide information to or for a Federal agency. This includes the time

needed to review instructions; develop, acquire, install, and utilize

technology and systems for the purposes of collecting, validating, and

verifying information, processing and maintaining information, and

disclosing and providing information; adjust the existing ways to

comply with any previously applicable instructions and requirements;

train personnel to be able to respond to a collection of information;

search data sources; complete and review the collection of information;

and transmit or otherwise disclose the information.

An Agency may not conduct or sponsor, and a person is not required

to respond to, a collection of information unless it displays a

currently valid OMB control number. The OMB control numbers for EPA's

regulations are listed in 40 CFR Part 9 and 48 CFR Chapter 15.

E. Executive Order 13084: Consultation and Coordination With Indian

Tribal Governments

Under Executive Order 13084, 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 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, any written communications from the

governments, and a statement supporting the need to issue the

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

an effective process permitting elected and other representatives of

Indian tribal governments ``to provide meaningful and timely input in

the development of regulatory policies or matters that significantly or

uniquely affect their communities.''

Today's proposed rule does not significantly or uniquely affect the

communities of Indian tribal governments. The proposed rule does not

impose any enforceable duties on Indian tribal governments.

Accordingly, the requirements of section 3(b) of Executive Order 13084

do not apply to this rule.

F. 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 proposed rule would not have a significant impact

on a substantial number of small entities since the rule allocates

CFC's to specific entities which have previously submitted requests.

This proposed rule would not have a significant impact on a

substantial number of small entities, therefore, I hereby certify that

this action will not have a significant economic impact on a

substantial number of small entities. This rule, therefore, does not

require a regulatory flexibility analysis.

G. Executive Order 13045: Protection of Children From Environmental

Health Risks and Safety Risks

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 Executive Order 12866, and (2) concerns an

environmental health and 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.

EPA interprets Executive Order 13045 as applying only to those

regulatory actions that are based on health or safety risks, such that

the analysis required under section 5-501 of the Order has the

potential to influence the regulation. This proposed rule is not

subject to Executive Order 13045 because it implements the phaseout

schedule established by Congress in Title VI of the Clean Air Act.

H. National Technology Transfer and Advancement Act

Section 12(d) of the National Technology Transfer and Advancement

Act of 1995 (``NTTAA''), Public Law 104-113, section 12(d) (15 U.S.C.

272 note) directs EPA to use voluntary consensus standards in its

regulatory activities unless to do so would be inconsistent with

applicable law or otherwise impractical. Voluntary consensus standards

are technical standards (e.g., materials specifications, test methods,

sampling procedures, and business practices) that are developed or

adopted by voluntary consensus standards bodies. The NTTAA directs

[[Page 59147]]

EPA to provide Congress, through OMB, explanations when the Agency

decides not to use available and applicable voluntary consensus

standards.

This proposed rule does not involve technical standards. Therefore,

EPA is not considering the use of any voluntary consensus standards.

I. Federalism

On August 4, 1999, President Clinton issued a new executive order

on federalism, Executive Order 13132, [64 FR 43255 (August 10, 1999),]

which will go into effect on November 2, 1999. In the interim, the

current Executive Order 12612, [52 FR 41685 (October 30, 1987),] on

federalism still applies. Under this order, this proposed rule will not

have a substantial direct effect upon States, upon the relationship

between the national government and the States, or upon the

distribution of power and responsibilities among the various levels of

government. This proposed rule will affect only the production of

controlled ozone-depleting substances by private entities.

List of Subjects in 40 CFR Part 82

Environmental protection, Administrative practice and procedure,

Air pollution control, Chemicals, Chlorofluorocarbons, Exports,

Hydrochlorofluorocarbons, Imports, Labeling, Ozone layer, Reporting and

recordkeeping requirements.

Dated: October 26, 1999.

Carol M. Browner,

Administrator.

40 CFR Part 82 is proposed to be amended as follows:

PART 82--PROTECTION OF STRATOSPHERIC OZONE

1. The authority citation for part 82 continues to read as follows:

Authority: 42 U.S.C. 7414, 7601, 7671-7671q.

Subpart A--Production and Consumption Controls

2. Section 82.4(t)(2) is amended by revising the table to read as

follows:

Sec. 82.4 Prohibitions.

* * * * *

(t) * * *

(2) * * *

Table I.--Essential Uses Agreed to by the Parties to the Protocol for

2000 and Essential Use Allowances

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

Quantity

Company Chemical (metric

tonnes)

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

(i) Metered Dose Inhalers for Treatment of Asthma and Chronic

Obstructive Pulmonary Disease

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

International Pharmaceutical Aerosol CFC-11 588.0.

Consortium (IPAC)--Medeva Americas, CFC-12 1,516.0.

Inc., Boehringer Ingelheim CFC-114 301.0.

Pharmaceuticals, Glaxo Wellcome,

Rhone-Poulenc Rorer, 3M.

Medisol Laboratories, Inc............ CFC-11 70.0.

CFC-12 120.0.

CFC-114 10.0.

Schering Corporation................. CFC-11 330.0.

CFC-12 680.0.

Sciarra Laboratories, Inc............ CFC-11 25.0.

CFC-12 75.0.

CFC-114 20.0.

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

(ii) Cleaning, Bonding and Surface Activation Applications for the Space

Shuttle Rockets and Titan Rockets

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

National Aeronautics and Space Methyl Chloroform 56.7.

Administration (NASA)/Thiokol Rocket.

United States Air Force/Titan Rocket. Methyl Chloroform 3.4.

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

(iii) Laboratory and Analytical Applications

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

Global Exemption (Restrictions in Class I Controlled No

Appendix G Apply). Substances excluding quantity

CFCs, carbon specified.

tetrachloride,

halons, and HBFCs

(hydrobromoflouro

carbons)

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

* * * * *

[FR Doc. 99-28506 Filed 11-1-99; 8:45 am]

BILLING CODE 6560-50-P