Approval of State Programs and Delegation of Federal Authorities
Federal RegisterJan 12, 1999
Ask Donna
What actually matters in this document.
Text
ENVIRONMENTAL PROTECTION AGENCY
40 CFR Part 63
[FRL-6212-3]
RIN 2060-AG60
Approval of State Programs and Delegation of Federal Authorities
AGENCY: Environmental Protection Agency (EPA).
ACTION: Proposed amendments; notice of public hearing.
-----------------------------------------------------------------------
SUMMARY: The EPA is proposing to change the Agency's current procedures
for delegating to State, local, territorial, and Indian tribes as
defined in 40 CFR 71.2 or agencies (i.e., S/L's) the authority to
implement and enforce Federal air toxics emissions standards and other
requirements. Specifically, these regulatory amendments propose to
revise procedures and criteria for approving S/L rules, programs, or
other requirements that would substitute for Federal emissions
standards or other requirements for hazardous air pollutants (HAP)
established under section 112 of the Clean Air Act (Act). Section
112(l) of the Act authorizes us to approve S/L programs when S/L
alternative requirements are demonstrated to be no less stringent than
the rules we promulgate.
These amendments would increase the flexibility of our existing
regulations in 40 CFR part 63, subpart E that implement section 112(l)
of the Act. They would provide a greater number of approval processes
from which S/L's can choose, increase the flexibility S/L's have to
demonstrate equivalency for their alternative requirements, and provide
options that will expedite the approval process. In addition, the
policy guidance in this notice clarifies what S/L's must or can do to
obtain delegated authority under subpart E, including how they can
demonstrate equivalency for alternatives to Federal requirements.
These changes are in response to requests we received from State
and local air pollution control agencies to reconsider our existing
regulations in light of implementation difficulties they have
experienced or anticipated. We believe this effort is consistent with
the President's regulatory ``reinvention'' initiative, and it will
result in less burden to S/L's, regulated industries, and the Federal
Government without sacrificing the emissions reduction and enforcement
goals of the Act. These amendments reduce the potential for redundant
or conflicting air regulations on industry while they accommodate a
wider variety of S/L program needs.
This rulemaking addresses requirements that apply to S/L's, should
they choose to obtain delegation or program approval under section
112(l). (Obtaining delegation under section 112(l) is voluntary). This
rulemaking does not include any requirements that apply directly to
stationary sources of HAP or small businesses that emit HAP.
DATES: Comments. Comments must be received on or before March 15, 1999.
Public Hearing. Anyone requesting a public hearing must contact the
EPA no later than January 26, 1999.
ADDRESSES: Comments. Comments should be submitted (in duplicate, if
possible) to: Air and Radiation Docket and Information Center (6102),
Attention Docket Number A-97-29, Room M-1500, U.S. Environmental
Protection Agency, 401 M Street, S.W., Washington, D.C. 20460. The EPA
requests a separate copy also be sent to the contact person listed
below (see FOR FURTHER INFORMATION CONTACT). Comments and data may also
be submitted electronically by following the instructions listed in
Supplementary Information.
Public Hearing. If a public hearing is held, it will be held at the
EPA's Office of Administration Auditorium, Research Triangle Park,
North Carolina. Persons interested in attending the hearing or wishing
to present oral testimony should notify the contact person listed
below.
Docket. Docket No. A-97-29, containing information relevant to this
proposed rulemaking, is available for public inspection and copying
between 8:00 a.m. and 5:30 p.m., Monday through Friday, at the EPA's
Air and Radiation Docket and Information Center (6102), 401 M Street,
S.W., Washington, D.C. 20460; telephone (202) 260-7548. A reasonable
fee may be charged for copying.
FOR FURTHER INFORMATION CONTACT: Mr. Tom Driscoll, Integrated
Implementation Group, Information Transfer and Program Integration
Division (MD-12), U.S. Environmental Protection Agency, Research
Triangle Park, North Carolina 27711; telephone (919) 541-5135;
facsimile (919) 541-5509, electronic mail address
``[email protected].''
SUPPLEMENTARY INFORMATION:
Regulated Entities
Entities potentially affected when the EPA takes final action on
this proposed rule are S/L governments that voluntarily take delegation
of section 112 rules, emissions standards, or requirements. The final
action on this proposal will not regulate emissions sources directly.
These categories and entities include:
------------------------------------------------------------------------
Category Examples
------------------------------------------------------------------------
S/L governments.............. S/L governments that voluntarily request
approval of rules or programs to be
implemented in place of Act section 112
rules, emissions standards or
requirements or voluntarily request
delegation of unchanged section 112
rules.
------------------------------------------------------------------------
This list is not intended to be exhaustive, but rather provides a guide
for readers regarding entities likely to be regulated by final action
on this proposal. This list contains the types of entities that EPA is
now aware could potentially be regulated by final action on this
proposal. Other types of entities not included in the list could also
be regulated. The procedures and criteria for requesting and receiving
approval of these S/L government rules or programs or voluntarily
requesting delegation of section 112 rules are in Sec. 63.90 through
Sec. 63.97, excluding Sec. 63.96, of this subpart.
Electronic Access and Filing Addresses
This notice, the proposed regulatory texts, and other background
information are available in the docket and by request from the EPA's
Air and Radiation Docket and Information Center (see ADDRESSES), or
access through the EPA web site at: http://www.epa.gov/ttn/oarpg.
Electronic comments on the proposed National Emission Standard for
Hazardous Air Pollutants (NESHAP) may be submitted by sending
electronic mail (e-mail) to: [email protected]. Submit
comments as an ASCII file avoiding the use of special characters and
any form of encryption. Comments and data will also be accepted on a
diskette in WordPerfect 5.1 or 6.1 or ASCII file format. Identify all
comments and data in electronic form by the docket number
[[Page 1881]]
(A-97-29). No confidential business information should be submitted
through electronic mail. You may file comments on the proposed rule
online at many Federal Depository Libraries.
Outline
The information presented in this preamble is organized as follows:
I. Purpose and Summary
II. What is the subject and purpose of this rulemaking?
A. Reasons for revisiting section 112(l) regulations
B. Legal and policy framework for revising section 112(l)
regulations
III. Who is subject to this rulemaking?
IV. What process was used to arrive at the decisions in this
rulemaking?
V. How do the delegation options currently in subpart E work?
A. Four ways to obtain delegation under the current subpart E
B. General approval criteria for delegations under the current
subpart E
C. Specific approval criteria and administrative process
requirements for delegations under the current subpart E
D. Federal enforceability of approved requirements
E. Purpose of up-front approval for all subpart E delegation
options
F. EPA can withdraw approval if a S/L is inadequately
implementing or enforcing its approved rule or program
VI. What concerns have S/L's raised regarding the current subpart E
delegation options and what actions has EPA taken to address these
concerns?
A. S/L issues with subpart E
B. What actions have EPA taken to address S/L's concerns?
C. Summary of proposed regulatory changes to subpart E
D. Policy guidance provided in the preamble
E. Policy guidance provided outside the preamble
VII. How do the revised delegation processes work?
A. Sec. 63.93 substitution of authorities
B. Sec. 63.97 State program approval process
C. Sec. 63.94 equivalency by permit approval process
VIII. How do the revised delegation processes compare?
A. What section 112 programs or sources are covered by each
process?
B. What is required for up-front approval?
C. What is required to demonstrate that alternative requirements
are equivalent?
D. What is required for EPA approval of alternative
requirements?
E. When do EPA and the public have an opportunity to comment on
S/L submittal?
IX. How should a S/L decide which delegation process(es) to use?
A. Sec. 63.93 substitution of rules or authorities
B. Sec. 63.94 equivalency by permit
C. Sec. 63.97 State program approval
X. How will EPA determine equivalency for S/L alternative NESHAP
requirements?
A. Introduction
B. Equivalency of alternative levels of control and compliance
and enforcement measures
C. Using compliance evaluation studies in equivalency
demonstrations
D. Proposed process for determining equivalency under subpart E
E. Equivalency of alternative work practice standards
F. Equivalency of alternative General Provisions
XI. How will the section 112(r) accidental release program
provisions of subpart E change, and how will these changes affect
the delegation of the RMP provisions?
XII. Administrative requirements for this rulemaking
A. Public Hearing
B. Docket
C. Executive Order 12866
D. Enhancing the Intergovernmental Partnership Under Executive
Order 12875
E. Consultation and Coordination with Indian Tribal Governments
Under Executive Order 13084
F. Paperwork Reduction Act
G. Regulatory Flexibility Act
H. Unfunded Mandates Reform Act
I. Protection of Children from Environmental Health Risks and
Safety Risks Under Executive Order 13045
J. National Technology Transfer and Advancement Act
XIII. Statutory Authority
I. Purpose and Summary
One of the reasons Congress created section 112(l) of the Act was
to recognize that many S/L's already had programs or regulations in
place to reduce emissions of toxic air pollutants, and that some S/L's
might wish to implement their programs or regulations in place of
otherwise applicable section 112 standards. After promulgation of the
initial subpart E regulations, some S/L's voiced the view that subpart
E would be more useful if we could allow S/L's more flexibility in
implementing their programs in place of section 112 standards. Based on
these comments, we decided to investigate ways to provide more
flexibility, particularly through the use of a greater variety of
regulatory pathways, so long as the result would clearly be emissions
reductions equivalent to the Federal standard being replaced.
During the process of ``reinventing'' the subpart E regulations, we
have solicited and responded to commenters through several different
routes. First, we conducted two stakeholder meetings to assess the
concerns not only of S/L's, but also of industries indirectly affected
by the subpart E regulations and environmental/public interest groups.
We also benefited from the input of issue work groups comprised of
representatives from the States, EPA Regions, and other EPA offices. We
used input from the stakeholder meetings, as well as other meetings
with S/L's, to create a draft preamble and regulatory amendments which
contained changes resulting from several commenters' suggestions. We
placed this draft on the Internet and solicited comments, which then
resulted in additional changes which we believe will fulfill our goal
of making the delegation of the section 112 standards easier, without
sacrificing environmental protection.
Another way that we have involved stakeholders is through the
Sacramento Protocol effort. Officials from the California Air Resources
Board (CARB), the South Coast Air Quality Management District (SCAQMD),
and the EPA Headquarters and Region IX Offices collaborated to analyze
five SCAQMD rules to determine whether they would achieve the same
emissions reductions as the otherwise applicable section 112 standards.
We discuss the results of the Sacramento Protocol in section X., of
this preamble.
These proposed changes to the subpart E regulations will provide
more flexibility in both accepting delegation of the section 112
standards and implementing approved alternative standards. In order to
provide more flexibility to S/L's, we are proposing several broad-based
changes: (1) Allowing more approval options; (2) allowing use of
holistic demonstrations to evaluate the stringency of S/L rules; and
(3) providing more flexibility in monitoring, reporting, and
recordkeeping (MRR).
First, to provide more flexibility and clarity, we have taken
Sec. 63.94, ``Approval of a State program that substitutes for section
112 emissions standards,'' and split it into two sections: Sec. 63.94,
Equivalency by Permit (EBP) and Sec. 63.97, State Program Approval
(SPA). The SPA option addresses approval of a broad variety of
regulatory and enforcement vehicles. The EBP option could be used to
expedite the section 112(l) review process significantly in those cases
where just a handful of sources required to obtain permits under title
V of the Act are affected by delegation of a section 112 standard to a
S/L (for example where a source category consists of just a few sources
in a State).
We have included partial approval as another way to increase the
flexibility S/L's will have when accepting delegation of the section
112 standards. When using partial approval, a S/L would only accept
delegation for part of its program or its rule.
We also intend to add flexibility by allowing S/L's to implement
their
[[Page 1882]]
delegated standards through a greater variety of regulatory vehicles.
The original subpart E regulations only allowed implementation of
alternative rules through rulemaking or title V permits. However, we
are proposing to expand the options for the implementation of
alternative S/L rules by allowing S/L's to implement the delegated
standards through rulemaking, title V permits, S/L permits, general
permits, permit templates, and administrative orders.
In addition, we intend to increase the ability of S/L's to
demonstrate that their standards are equivalent to the otherwise
applicable section 112 standards by adopting a holistic approach to
evaluating S/L standards. In other words, we would evaluate S/L
standards as a whole to determine whether they would achieve equal or
better emissions reductions than the otherwise applicable section 112
standard.
Finally, we propose to increase the amount of flexibility S/L's
would have in comparing their compliance assurance measures to the
compliance assurance measures in the otherwise applicable section 112
standard. Section X.D.3. of this preamble contains a detailed
discussion of how we would compare the compliance assurance measures in
an alternative S/L standard to the compliance assurance measures in the
otherwise applicable section 112 standard. In general, we want to
guarantee that S/L compliance assurance measures will ensure the same
rate of compliance that our compliance assurance measures would ensure.
Furthermore, we are proposing to allow the process developed under the
Sacramento Protocol to be used as a supplement to the overall
evaluation of S/L standards.
II. What Is the Subject and Purpose of This Rulemaking?
A. Reasons for Revisiting Section 112(l) Regulations
Before the Act was amended in 1990 (1990 Amendments), many S/L's
developed their own programs for the control of air toxics (i.e., HAP)
from stationary sources. Some of these S/L programs have now been in
place for many years and, for some of the source categories regulated
by Federal emissions standards under section 112 of the Act, the S/L
programs may have succeeded in reducing air toxics emissions to levels
at or below those required by the Federal standards. For purposes of
this discussion, the Federal emission standards established under
section 112 authority are codified in 40 CFR part 63. These standards
are referred to as NESHAP.
These programs, developed to address specific S/L needs, often
differ from the Federal rules we develop under section 112. As a
result, S/L programs may result in controls or other requirements that,
on the whole, are more stringent than, equivalent to, or less stringent
than controls resulting from the corresponding Federal emissions
standards in terms of the emissions reductions they achieve.
The U.S. Congress was very aware of S/L air toxics programs in the
course of developing the 1990 Amendments to the Act. Seeking to
preserve these programs, Congress included provisions in section 112(l)
that allow us to recognize S/L's air toxics rules or programs in place
of some or all of the corresponding Federal section 112 requirements.
In other words, we may approve S/L rules or programs if they meet
certain criteria (such as demonstrating adequate resources, legal
authorities, level of control, and compliance and enforcement measures)
and allow them to substitute for part 63 NESHAP regulations established
under sections 112(d), 112(f), or 112(h) (or other section 112
requirements such as the Risk Management Program addressed in section
112(r) and 40 CFR part 68). In addition, section 112(l) allows us to
delegate to S/L's the authority to implement and to enforce part 63
NESHAP exactly as we promulgate them, that is, without any changes.
Thus, a S/L may obtain delegated authority to implement and enforce
a NESHAP in either of two circumstances: (1) when the S/L has taken
delegation for unchanged Federal standards, a process called
``straight'' delegation, or (2) when the S/L obtains approval for rules
or other requirements that substitute for the Federal NESHAP
requirements. Under section 112(l), submission of any rules or programs
by S/L's for approval and delegation is voluntary. If S/L's do not
obtain approval or delegation, we continue to have primary authority
and responsibility to implement and to enforce section 112 regulations.
Overall, the goal of section 112(l) is to allow S/L regulators to
implement and enforce their programs (or rules) to control emissions of
HAP from stationary sources, provided those programs achieve results
that are equivalent to the Federal program. We believe that Congress
intended S/L's to be the primary authorities responsible for carrying
out the mandates of the Federal air toxics program. Where S/L air
toxics regulations control emissions of HAP as stringently as NESHAP,
we believe that it is Congress's intention in section 112(l) to
integrate these programs with the Federal air toxics program as it was
revised in 1990. (S/L's may also have volatile organic compounds (VOC),
particulate matter (PM), or lead (Pb) regulations developed under
section 110 of the Act that indirectly control emissions of HAP and
that may, in some cases, be substituted for section 112 requirements.)
Section 112(l) allows the integration of Federal and S/L programs
in order to minimize the potential for ``dual regulation.'' Dual
regulation refers to a situation in which sources of HAP are subject
simultaneously to S/L and Federal requirements that overlap, conflict,
or are otherwise duplicative. By working together to minimize the
potential for dual regulation, we and our S/L co-regulators hope to
reduce unnecessary burden associated with (1) complying with section
112 air toxics control requirements, and (2) issuing permits and
otherwise implementing or enforcing those requirements. We consider
burden ``unnecessary'' when it does not materially contribute to
assuring that sources of HAP achieve the emissions reduction goals
established by our Federal section 112 requirements, or it does not
contribute toward assuring compliance with those requirements.
Under section 112(l)(2) of the Act, we are required to publish
``guidance'' that governs how S/L's may develop and submit, and how we
may approve, S/L air toxics rules or programs that meet the goals of
the Act and the Federal air toxics program. On November 26, 1993, we
finalized regulations that carried out this mandate. (See 58 FR 62262,
Approval of State Programs and Delegation of Federal Authorities, Final
rule). The November 26, 1993 regulations, which can be found in 40 CFR
part 63, subpart E, provide regulatory ``guidance'' regarding approval
of S/L rules or programs that can be implemented and enforced in place
of Federal section 112 rules as well as the delegation of our
authorities and responsibilities associated with those rules. Under
subpart E, such agencies may obtain approval from us to implement and
enforce provisions of their own air pollution control programs in lieu
of federally promulgated NESHAP and other section 112 requirements for
stationary sources. Once approved, S/L rules and applicable
requirements resulting from those rules are considered federally
enforceable and substitute for the Federal requirements that would
otherwise apply to those stationary sources. Overall, the subpart E
[[Page 1883]]
regulations assure that all sources of HAP that are subject to
regulation under section 112 achieve the emissions reductions that are
intended by the Federal emissions standards or other requirements.
The current subpart E provides several different processes (that we
also refer to as options) that a S/L may pursue to obtain delegation or
program approval. A S/L would pursue one or more of these delegation/
approval processes based on the particular programmatic needs and goals
of that agency. A S/L may ``mix and match'' the various processes
provided in subpart E to minimize the overall burden associated with
program approval and to obtain the desired delegation outcome. In
addition to providing the procedural requirements for delegation and
program approval, subpart E describes the necessary criteria and other
requirements a S/L rule or program must meet in order for us to approve
it.
After subpart E was promulgated, several S/L's raised concerns to
us about making these regulations more workable. Since August 1995, we
have been engaged in discussions with S/L representatives to understand
their concerns and to rethink how subpart E might be better structured
to accomplish its goals. These discussions have focused on and
benefited from experiences to date actually implementing the approval
processes included in subpart E. Based on these experiences and the
relative maturity of the air toxics and the title V operating permits
programs since promulgation of the subpart E rules in 1993, we believe
it is appropriate at this time to revise the subpart E regulations.
Thus, in this notice, we are proposing to amend the existing
subpart E regulations to make them easier to use. One goal of this
effort is to introduce additional flexibility into the subpart E
approval processes and criteria in order to accommodate a wider variety
of S/L program needs, without sacrificing the emissions reduction and
enforceability goals of the Act. Through this effort, we hope to
provide additional flexibility to S/L in how they accept delegation for
the section 112 program, including how they are required to establish
the equivalency of their alternative requirements. We believe this will
result in less overall burden to S/L in seeking approval for delegation
requests, to us in approving such requests, and to regulated industries
in complying with the array of S/L and Federal regulations to which
they are subject. In making it easier for S/L to obtain delegation (and
in minimizing disruption of S/L programs), we hope to achieve the
second critical goal of this effort to revise subpart E, to further
minimize the likelihood of dual regulation of stationary sources.
B. Legal and Policy Framework for Revising Section 112(l) Regulations
In proposing revisions to the subpart E regulations, we have
provided as much additional flexibility as we believe is appropriate,
both in light of the statute and given our need to assure the American
public that they are getting the same or better environmental
protection from the S/L requirements that would replace the Federal
section 112 requirements. We believe that the flexibility provided in
the subpart E delegation/approval processes cannot compromise the
environmental results or the enforceability of the otherwise applicable
Federal requirements.
Equivalency demonstrations that S/L's submit for specific
alternative section 112 requirements must show that the alternative
requirements achieve the emissions reductions required by the otherwise
applicable Federal requirements. They also must demonstrate equivalency
on an affected source basis.1 However, this does not mean
that S/L's must demonstrate ``line-by-line'' equivalency with the
section 112 requirements.
---------------------------------------------------------------------------
\1\ Affected source is a defined term in Sec. 63.2 of the part
63 General Provisions. It refers to the portion of a stationary
source that is regulated by a Federal section 112 emissions standard
or requirement.
---------------------------------------------------------------------------
As a legal matter, only the EPA has the authority to approve
alternative section 112 requirements that apply to a category of
sources for which we have promulgated Federal emissions standards. In
other words, we may not delegate to S/L's the authority to make
findings of equivalency between their programs' requirements and the
requirements of the otherwise applicable Federal standards.
In these rule revisions, we are proposing that the ``test'' for
equivalency between the S/L and Federal requirements should be the same
no matter which delegation/approval option a S/L chooses to pursue
among the options that allow alternative requirements to be substituted
for Federal requirements. By ``test'' we mean the criteria that we
would use to determine whether S/L requirements are as stringent as
ours in terms of the effect they would have on achieving the required
emissions reductions, assuring compliance, and enabling appropriate
enforcement actions.
Before discussing the proposed changes to subpart E, we thought it
would be useful to identify who is subject to this rulemaking, describe
the process that was used to arrive at the decisions in this package,
review background on the existing structure and content of subpart E,
and summarize the key S/L concerns that we have addressed in this and
previous actions.
III. Who Is Subject to This Rulemaking?
This rulemaking addresses requirements that apply to ``States,''
should they choose to obtain delegation or program approval under
section 112(l) of the Act. Submission of rules or programs by
``States'' for approval and delegation under section 112(l) is
voluntary. The definition of ``State'' in subpart E covers all non-
Federal authorities, including local air pollution control agencies,
statewide programs, Indian Tribes, and U.S. Territories. Because these
authorities are the primary intended audience for this regulation, from
this point on we use ``you'' or ``your'' to address our comments
directly to any or all of these authorities. In addition, we may also
refer to these authorities as S/L. Note, however, that any requests for
comment on these proposed amendments are directed to the public-at-
large, not just S/L.
Consistent with the existing subpart E regulations that govern
section 112(l) delegations and approvals, this rulemaking does not
include any requirements that apply directly to stationary sources of
HAP. We regulate HAP sources by developing NESHAP and other types of
requirements under section 112. The subpart E regulations that are the
subject of this rulemaking merely establish criteria and procedures for
determining the governmental agency that will have primary
responsibility within a jurisdiction for implementing and enforcing our
emissions standards (and other substantive section 112 requirements),
and they establish the processes by which you may implement regulations
that, while not identical to our emissions standards, achieve the same
or better results.
IV. What Process Was Used To Arrive at the Decisions in This
Rulemaking?
In August 1995, S/L air pollution control program officials,
presented to us their views as to why the current subpart E rule needs
to be revised. They indicated that subpart E does not provide
sufficient flexibility for you to use its delegation options, and that
the requirements for establishing that your programs result in
equivalent or better emissions reductions are too
[[Page 1884]]
burdensome. During the succeeding 2 years, we held numerous discussions
with representatives of S/L air pollution control program officials to
better understand their views and to develop options for addressing
their concerns while still assuring that the requirements of the Act
are met. After developing some approaches for responding to S/L air
pollution control program officials' concerns, we involved a wider
group of stakeholders, e.g., industry and public interest groups, to
alert them of our plans and to ask for their input. For example, we
held meetings with the Toxics/Permitting/New Source Review Subcommittee
of the Clean Air Act Advisory Committee in Washington, DC, with
stakeholders in Los Angeles, California on December 5 and 6, 1996, and
with stakeholders in Washington, DC on February 26, 1997 and July 9 and
10, 1997 to gather their input. We also undertook a study with CARB and
SCAQMD to analyze emission reductions of their rules compared with the
otherwise applicable section 112 standards.
V. How Do the Delegation Options Currently in Subpart E Work?
A. Four Ways To Obtain Delegation Under the Current Subpart E
The following discussion explains the delegation options currently
available to you under the existing subpart E regulations. Sections
VII. through X. of the preamble, below, explain how we are proposing to
modify and expand these delegation options to give you more choices in
how you may seek delegation for one or more section 112 emissions
standards or requirements.
Subpart E as currently written contains four ways for you to obtain
delegation. You may use any one or any combination of these options in
your request for approval of your rules, authorities, or programs. (If
you are accepting delegation of all Federal section 112 rules without
changes, streamlined delegation mechanisms are available. See the
original subpart E proposal preamble, 58 FR 29298, May 19, 1993, and
the direct final amendments in 61 FR 36295, July 10, 1996.) Under each
of these delegation options, you must demonstrate that each of your
rules, standards, or requirements (as appropriate) for an affected
source is no less stringent than the Federal rule, emissions standard,
or requirement that would otherwise apply to that same affected source.
The four ways to obtain delegation are listed.
1. Unchanged Federal Standards--``Straight'' delegation to
implement an unchanged Federal standard or requirement. Under this
process, you may receive delegation for Federal standards and
requirements that are unchanged from the promulgated requirements, as
well as delegation of authority for unchanged rules and standards that
we will issue in the future. These provisions are addressed in
Sec. 63.91 and in various guidance memoranda and documents, including
``Interim Enabling Guidance for the Implementation of 40 CFR Part 63,
Subpart E'' (EPA-453/R-93-040, November 1993).
2. Rule Adjustment--Delegation to implement a Federal standard
through approval of your rule (or rules) that adjusts a Federal rule in
minor ways that are already listed in subpart E, Sec. 63.92. Each
adjustment taken individually must be no less stringent than the
corresponding requirement in our standard. If your rule meets the
criteria listed in Sec. 63.92, you can receive approval to replace our
rule with yours very quickly.
3. Authority Substitution--Delegation to implement a Federal
standard through approval of your rule (or rules, or other authorities)
that adjusts a Federal rule in significant ways that are not predefined
in subpart E and are no less stringent. Taken as a whole, the
adjustments must result in rules (or other authorities) that are
equivalent to, or no less stringent than, the Federal standard in terms
of the emissions reductions that they require. These provisions are
addressed in Sec. 63.93.
4. Program Approval--Delegation to implement some or all Federal
emissions standards through development of terms and conditions in 40
CFR title V operating permits, rather than through approval of your
substantive rules. First, through an ``up-front'' approval, we ratify
your commitments to develop appropriate permit terms and conditions;
later, we review the proposed permits for sources affected by the
NESHAP. Through the title V permitting process you may change
requirements in the Federal emissions standards, provided that the
results of each change are equivalent to (i.e., unequivocally no less
stringent than) the corresponding Federal requirements and you
demonstrate the equivalency of your alternative requirements by
presenting the proposed permit terms and conditions in the ``form'' of
the Federal standard. By ``form'' of the Federal standard, we mean the
terms and units of measurement in which the requirements are expressed.
These provisions are addressed in Sec. 63.94.
B. General Approval Criteria for Delegations Under the Current Subpart
E
To obtain delegation under any of these approval processes, you
must demonstrate that you have met certain basic approval criteria that
are listed in Sec. 63.91 as well as any additional process-specific
approval criteria that are included in the sections that address the
delegation mechanisms that you choose to pursue. To obtain approval for
your rule or program, Sec. 63.91 requires you to demonstrate to us that
you have adequate legal authority and resources to implement and
enforce your rule or program upon approval. You must also demonstrate
that your rule or program assures that all sources within your
jurisdiction will comply with each applicable section 112 rule. In
addition, you must provide an expeditious implementation schedule, a
plan that assures expeditious compliance by all sources subject to the
rule or program, and a copy of each of your statutes, regulations, and
other requirements that contain the appropriate provisions granting
authority to implement and enforce your rule or program upon approval.
In general, title V program approval is sufficient to demonstrate that
you have satisfied subpart E's general approval criteria in Sec. 63.91,
at least for sources permitted under your title V program.
C. Specific Approval Criteria and Administrative Process Requirements
for Delegations Under the Current Subpart E
1. Sec. 63.91 ``Straight'' Delegation
Under the ``straight'' delegation option in Sec. 63.91, you may
implement Federal section 112 requirements without changes. You may use
this option when you want to accept delegation of an existing or a
future Federal section 112 standard as promulgated. The approval
process under Sec. 63.91 consists of notice and comment rulemaking in
the Federal Register. Upon approval of your request for delegation of
Federal section 112 rules as promulgated (there are some variations for
section 112(r) accidental release programs), we would publish the
approval in the Federal Register and incorporate it, directly or by
reference, in the appropriate subpart of part 63. In addition, you can
establish a mechanism for future delegation of section 112 standards as
promulgated (e.g., automatic or adoption by reference) that is suitable
for your State's method of adopting regulations. Future delegations of
promulgated section 112 rules would not have to go
[[Page 1885]]
through an additional Federal Register public notice and comment. This
mechanism can be similar to the process established under EPA's 1983
guidance in the ``Good Practice Manual for New Source Performance
Standards (NSPS) and NESHAP.''
Alternatively, you could choose to submit separate Sec. 63.91
requests for delegation of each specific 112 requirement. If no adverse
comments are expected, we can do direct final rulemaking to streamline
the delegation of these section 112 requirements. Under this option,
the Federal Register notice would state something like ``* * * unless
adverse comments are received, this action will be considered final in
21 days.''
For additional detail on how this and the other current subpart E
delegation options work, see ``Interim Enabling Guidance for the
Implementation of 40 CFR Part 63, Subpart E'' (EPA-453/R-93-040,
November 1993).
2. Sec. 63.92 Rule Adjustment
Under the rule adjustment option in Sec. 63.92, we can approve one
(or more) of your rules that is structurally very similar to, and is
clearly at least as stringent as, the Federal rule for which you want
to substitute your rule(s). Under this option, you may only make an
adjustment to the Federal rule that results in emissions limits and
other requirements that are clearly no less stringent, on an affected
source basis, than the Federal rule. There can be no ambiguity
regarding the stringency of any of the proposed adjustments. Section
63.92 includes a list of rule adjustments that may be approved under
this option--for example, lowering a required emissions rate or
subjecting additional emissions points within a source category to
control requirements. We consider all of these adjustments to result in
requirements that are more stringent than the corresponding Federal
requirements. In addition, your rule must have undergone public notice
and provided an opportunity for public comment in your jurisdiction
before you submit it to us for approval. If we find that the necessary
criteria are met, we would approve your rule with adjustments, and it
becomes federally enforceable in lieu of the otherwise applicable
section 112 rule. Upon approval, your rule would be published in the
Federal Register and incorporated directly or by reference into part
63, without additional notice and opportunity for comment.
3. Sec. 63.93 Substitution of Authorities
Under Sec. 63.93, substitution of authorities (which is commonly
referred to as the rule substitution option), we can approve
substitution of one (or more) of your rules or requirements for a
Federal rule, where your rule is structurally different from the
corresponding Federal rule. Under this section, we also may approve a
rule that is different from the Federal rule in ways that do not
qualify for approval under Sec. 63.92--that is, in ways that are not
``unambiguously no less stringent.'' This situation might arise when
you submit a rule that was written independently of the Federal rule or
when, for example, your rule achieves equivalent emissions reductions,
but with a combination of levels of control and compliance and
enforcement measures not addressed in or by the Federal rule. (Level of
control and compliance and enforcement measures are terms that are
defined in Sec. 63.90.) Any rules or other requirements that you submit
under this section must be enforceable under your State law.
Under the existing subpart E rule language, authorities that you
may submit for approval under this section include the following:
(1) S/L rules or other requirements enforceable under State law; or
(2) In the case of alternative work practice standards, specific
title V or part 71 permit terms and conditions for the source or set of
sources in the source category for which you are requesting approval
under subpart E. The permit terms and conditions must address control
requirements as well as compliance and enforcement measures.
Under Sec. 63.93, you must make a detailed demonstration that your
rule (or other authorities) would achieve equal or greater emissions
reductions (or other measure of control stringency where appropriate)
for each affected source regulated by the Federal section 112 rule.
Upon receipt of a complete request for approval of a substituted rule
(or other authorities), we would conduct a rulemaking to request public
comments on the proposed substitution. If we find that your
demonstration is satisfactory and the public comments do not dissuade
us, we would approve your rule, publish it in the Federal Register, and
incorporate it directly or by reference into part 63. Your approved
rule and/or requirements would be federally enforceable and they would
replace the otherwise applicable Federal rule in your jurisdiction for
the affected sources.
The approval criteria in Sec. 63.93(b)(2) require that, in any
request for approval under this section, you provide detailed
documentation that your authorities contain or demonstrate:
(1) Applicability criteria that are no less stringent than those in
the respective Federal rule. Applicability criteria is also a term that
is defined in Sec. 63.90;
(2) Levels of control and compliance and enforcement measures that
would achieve emissions reductions from each affected source that are
no less stringent than would result from the otherwise applicable
Federal standard;
(3) A compliance schedule that assures that each affected source is
in compliance no later than would be required by the otherwise
applicable Federal rule; and
(4) Additional criteria specified in Sec. 63.93(b)(4) that are not
repeated here.
To obtain approval under Sec. 63.93, you must demonstrate that you
have satisfied the approval criteria in Sec. 63.93(b) in addition to
the approval criteria in Sec. 63.91(b). As we mentioned earlier, you
may usually demonstrate that you have satisfied Sec. 63.91(b) if you
have an approved title V or part 71 operating permits program. In
addition, once you have demonstrated that you have satisfied the
Sec. 63.91(b) criteria under a Sec. 63.93 approval action, you
generally would not have to repeat the Sec. 63.91(b) demonstration when
you submit additional rules for approval in the future, provided that
your approved resources, authorities, and other program elements are
still adequate to implement and enforce the rules for which you are
seeking delegation, and provided that you are not seeking delegation
for rules that affect sources that your original program approval did
not address (e.g., area sources). Another example of a situation in
which you may need to resubmit Sec. 63.91(b) approval elements is when
you submit for approval an alternative compliance and enforcement
strategy that involves a more resource-intensive inspection program
than the one previously approved.
4. Sec. 63.94 Program Approval
Under the current program approval option in Sec. 63.94, we may
approve your program so that you can substitute alternative
requirements for one, some, or all section 112 emissions standards
through the title V or permitting process. Currently, this option is
available only for sources that will be permitted under title V.
For approval to implement and enforce your program in place of the
otherwise applicable Federal section 112 emissions standards, you must
[[Page 1886]]
make a number of legally binding commitments:
(1) First, you must commit to regulating every source that would
have been regulated by the Federal section 112 emissions standards for
which your program is intended to substitute;
(2) Second, you must provide assurance that the level of control
and compliance and enforcement measures in each 40 CFR title V permit
you issue for these sources is at least as stringent as those that
would have resulted from the otherwise applicable Federal emissions
standards;
(3) Finally, you must commit to expressing the 40 CFR title V
operating permits conditions in the ``form'' of the otherwise
applicable Federal standard. This means that you must commit to
translating your standards from the ``form'' you have used in your
rules to the Federal ``form'' so that operating permits conditions are
expressed in the same terms and units of measure and include the same
monitoring and test procedures as in the Federal rule or federally
approved alternatives. This means that you must use monitoring and
testing methods which we have approved for application under the
Federal rule.
To approve these commitments and identify the list of sources or
source categories for which you intend to use this option, we would do
a notice and comment rulemaking in the Federal Register. We refer to
this rulemaking as the ``up-front'' approval. Our approval of
alternative requirements for specific sources would take place during
the title V permit issuance process. Thus, beyond the ``up-front''
approval of your commitments and other legal authorities, under this
option we do not conduct rulemaking to approve your alternative,
source-specific requirements.
This mechanism, including the ``form'' of the standard approval
criterion in Sec. 63.94(b)(2)(D), was intended to provide us with an
opportunity for expedited review of your alternative requirements in
the form of title V permit terms and conditions during the permit
issuance process, instead of requiring us to examine and approve source
category rules through the authority (rule) substitution option in
Sec. 63.93. The title V permit issuance process includes opportunities
for public and EPA review, and for EPA objection, of the proposed
alternative S/L requirements; therefore, it can serve as the approval
mechanism in lieu of Federal rulemaking under this option. In addition,
the permit itself acts as the Federal enforcement mechanism under this
option. Upon our approval of the proposed permit, the alternative
requirements become federally enforceable and replace the otherwise
applicable Federal section 112 requirements for that particular
standard (or standards) for that particular source.
The program substitution option as currently written allows you to
substitute an entire program of alternative air toxics rules for all or
some of the Federal section 112 rules. This type of situation might
arise if you have a mature air toxics program with many regulations
affecting source categories regulated by Federal section 112 standards.
If we approve your program under this option, you can implement and
enforce alternative NESHAP requirements for specific emissions
standards that are identified in the ``up-front'' program approval.
These emissions standards and/or requirements may have been established
under sections 112(d), 112(f), 112(h), or other section 112 provisions.
D. Federal Enforceability of Approved Requirements
Our promulgated section 112 standard is the applicable and
federally enforceable standard until we approve your rule or program to
take its place following the procedures and criteria in subpart E. Your
rule or program requirements become the applicable and federally
enforceable standard starting on the date of approval of your rule,
program, or other requirement (or in the case of Sec. 63.94 program
approval, starting on the date of permit issuance). Under subpart E,
Sec. 63.91(a)(6), the date of approval is the date of publication in
the Federal Register. After the approval date, our promulgated standard
is no longer applicable or enforceable for the sources in your
jurisdiction.
Although you become the primary implementation and enforcement
authority when you accept delegation for a section 112 emissions
standard, we continue to have concurrent authority to enforce the
standard which, depending on the delegation mechanism you used, may be
either your approved rule or the unchanged Federal standard. In other
words, after we approve your rule or program, we still have the
authority to enforce the complete emissions standard, including any
``alternative'' requirements arising from your rule or program. This
authority is spelled out in section 112(l)(7) of the Act and Sec. 63.90
and Sec. 63.97 of the proposed rule. Nothing in these amendments
changes our interpretation of section 112(l)(7), or how it is
implemented through subpart E.
E. Purpose of Up-Front Approval for All Subpart E Delegation Options
No matter which subpart E delegation option(s) you pursue, you must
demonstrate that you have satisfied the general delegation/approval
criteria contained in Sec. 63.91(b). In addition, under the current
rule, to obtain delegation/approval under a particular option in
Sec. 63.92, Sec. 63.93, Sec. 63.94, or Sec. 63.95, you must demonstrate
that you have satisfied the additional approval criteria specified in
the relevant section.
The rulemaking we conduct under each subpart E delegation option to
codify our finding that you have satisfied the up-front approval
criteria serves several critical functions under section 112(l). First,
the process of approving the up-front portion of your program assures
that you have met the delegation criteria in section 112(l)(5) (as
codified in Sec. 63.91(b)), that is, that you have demonstrated
adequate authority and resources, an expeditious implementation
schedule, an adequate enforcement strategy, and that your program is
likely to satisfy the objectives of the Act. (To the extent that these
have already been satisfied through a title V program approval, you
need not resubmit information demonstrating that you meet the
Sec. 63.91(b) criteria. As we explain later, we believe that title V
program approval often is sufficient to demonstrate that you have met
the Sec. 63.91(b) criteria.)
Second, our section 112(l) approval of your program provides the
legal foundation by which section 112 requirements may be replaced by
your alternative requirements such that your requirements become the
federally enforceable requirements in lieu of the applicable Federal
requirements. By acting on your program as a whole, we are satisfying
certain prerequisites for removing the Federal requirements from the
list of applicable requirements to which sources are subject for
enforcement purposes (and that must be accounted for in sources' title
V permits). The up-front approval component under the subpart E
approval processes is necessary for you to apply your alternative
requirements to section 112-affected sources and have those
requirements be considered federally enforceable.
Third, the up-front approval step provides for an orderly way of
identifying which authorities have been delegated to you in relation to
specific Federal emissions standards or requirements. Delineation is
necessary for us, the public, and the regulated community to ascertain
readily what requirements apply to each affected
[[Page 1887]]
source. Without this process, there is no way to distinguish legally
and practicably which emissions standards or requirements apply to each
affected source and which agency has primary implementation and
enforcement authority for each affected source. (It is particularly
important to clarify which agency has primary enforcement authority for
Federal requirements as they apply to particular sources before those
requirements are incorporated into sources' title V permits.) This is
why we require you to specifically request in your submission for
approval the Federal section 112 authorities for which you are seeking
delegation. It would be assumed that all other existing (i.e.,
promulgated) or future Federal requirements not cited are not delegated
to you.
If, in the future, you would like to expand the coverage of your
approved program to include additional Federal requirements, you must
repeat the up-front approval step to identify those requirements, the
affected source categories, and any additional information that we need
to approve by rulemaking to allow you to implement and enforce your
alternative requirements for those categories. You would also be
required to certify that nothing in your program has changed in any way
that affects your ability to meet the Sec. 63.91(b) approval criteria.
This is not to say, however, that you must resubmit information
that you have already submitted and had approved under title V.
Previously, in the subpart E promulgation preamble (see 58 FR 62271-
72), we stated that ``the information which must be submitted by a
State under part 70 encompasses the information required under section
112(l)(5) for approval of State programs that seek only to implement
and enforce Federal standards exactly as promulgated,'' and ``for part
70 sources, part 70 approval also constitutes approval under section
112(l)(5) of the State's programs for delegation of section 112
standards that are unchanged from Federal standards as promulgated.''
This means that, for delegation requests under the existing subpart E
regulations where the Sec. 63.91(b) approval criteria are the only
criteria that you must satisfy, i.e., for ``straight'' delegation
situations, you can demonstrate that you have satisfied the
Sec. 63.91(b) criteria by demonstrating title V program approval (for
the sources for which you are accepting delegation that are covered by
your title V program). In the preamble to the existing subpart E rule,
we did not make clear that, under the existing subpart E regulations,
title V program approval could be considered sufficient to demonstrate
that you have satisfied the section 63.91(b) criteria for delegation
requests other than ``straight'' delegations.
F. EPA Can Withdraw Approval If a S/L Is Inadequately Implementing or
Enforcing Its Approved Rule or Program
Section 63.96 in subpart E addresses what happens if we find that
you are not implementing or enforcing your approved rule or program
according to the criteria you agreed to when you obtained delegation.
Section 63.96 lays out procedures and criteria that address program
corrections and program withdrawals. For example, at any time after we
approve your rule or program we may ask you to provide us with
information that shows how you are implementing and enforcing the rule
or program. If we have reason to believe that you are not adequately
implementing or enforcing your approved rule or program (or that the
approved rule or program is not as stringent as the otherwise
applicable Federal rule, emissions standard, or requirements, or that
you no longer have adequate authorities and resources to implement and
enforce), we would inform you in writing of our findings and the basis
for them. You then have an opportunity to correct the deficiencies and
to inform us of the corrective actions you have undertaken and
completed. If we find that your actions are not adequate to correct the
deficiencies, we would notify you that we intend to withdraw approval
of your previously approved rule or program (or part of it). The
withdrawal process includes opportunities for a public hearing and a
public comment period.
Based on public comments received, and your reaction to them, we
may notify you of changes or actions that we think are needed to
correct your rule or program deficiencies. If you do not correct these
deficiencies within 90 days, we would withdraw approval of your
federally enforceable rule or program. Upon withdrawal, your rule is no
longer federally enforceable and the Federal rule that it had replaced
again becomes the federally enforceable set of applicable requirements
for the subject sources. With the withdrawal notice, we would publish
an expeditious schedule for the sources subject to your previously
approved rule or program to come into compliance with the applicable
Federal requirements. You would need to revise the title V operating
permits for any sources that were subject to your previously approved
rule or program.
Section 63.96 also provides that you may submit a new rule or
program (or portion) for approval after we have withdrawn approval of
your rule or program (or portion). You may also voluntarily withdraw
from an approved rule or program (or portion) by notifying us and all
subject sources and by providing notice and opportunity for public
comment within your jurisdiction. If you voluntarily withdraw from
approval, we would publish an expeditious timetable for sources to come
into compliance with the applicable Federal requirements and you would
revise their title V operating permits to reflect the new requirements.
VI. What Concerns Have S/L's Raised Regarding the Current Subpart E
Delegation Options and What Actions Has EPA Taken To Address These
Concerns?
A. S/L Issues With Subpart E
On August 14, 1995, S/L air pollution control program officials
presented us with a list of issues and implementation difficulties that
they associate with subpart E's requirements. This list was compiled by
S/L representatives based on their actual experiences with subpart E
and on anticipated difficulties with forthcoming submissions for
approval. As we understand their concerns, some of their major issues
are that subpart E appears to require a ``line-by-line'' equivalency
demonstration between your requirements and ours, and that you must
present your alternative requirements in the ``form'' of the Federal
standard. ``Form'' of the standard refers to the terms, such as units
of measure, in which emissions limits and compliance and enforcement
measures are expressed. (For example, if a certain Federal emissions
standard requires an emissions limit of 5 pounds per hour of a HAP from
a particular piece of equipment, you would have to express an emissions
limit resulting from your programs' requirements in the same units,
i.e., pounds per hour, and the actual limit would have to be 5 or fewer
pounds per hour in order to be no less stringent than the Federal
standard.)
We think these concerns arise from language in Sec. 63.94 that
requires separate equivalency demonstrations for emissions limits,
compliance and enforcement measures (MRR), and compliance dates. These
provisions were included because we believed it would simplify and
speed our and the public's analysis that your program's alternative
requirements achieve the same or better results than our rules or
programs; without these provisions, we believe we would not have the
resources to perform this analysis during our 45-
[[Page 1888]]
day review period for each permit. Our understanding is that they
believe these provisions limit your flexibility to substitute your
requirements for the Federal requirements. They asked us to remove the
``form'' of the standard and line-by-line equivalency requirements from
subpart E. This is the key issue we addressed through these regulatory
amendments and clarifications to subpart E.
Another one of their concerns with subpart E as it is currently
structured pertains to the length of the approval process for a rule
substitution under Sec. 63.93. Section 63.93 allows us to take up to
180 days to review and act on your submittal, consistent with section
112(l)(5) of the Act, which allows us 180 days to approve or disapprove
a ``program.'' They expressed concern that the 180-day review period
may cause delays for the regulated community, and they requested that
we explore ways to expedite the approval process.
They also expressed concern that the program approval option in
Sec. 63.94 does not include a mechanism for you to accept delegation of
the Federal requirements for section 112 area sources that are not
required to obtain title V operating permits. You asked us to revise
subpart E so that a mechanism is available to delegate changed Federal
standards for both title V and non-title V sources.
They also asked us to clarify how you may substitute alternative
work practice standards (WPS) for federally promulgated WPS under
section 112(l). One of their concerns relates to the equivalency
criteria for ``nonquantifiable WPS,'' that is, those WPS for which the
expected emissions reductions or specific performance requirements
cannot be quantified.
They reiterated their concern about the potential for dual
regulation if you are unable to demonstrate equivalency and obtain
approval to implement and enforce your rules or programs in place of
ours. As we mentioned earlier, dual regulation describes the situation
where sources must comply simultaneously with overlapping, redundant,
inconsistent, or incompatible S/L and Federal requirements. While we do
not think this situation will occur very frequently, we agree that it
should be avoided wherever possible.
On October 30, 1997, the California Air Resources Board (CARB)
presented us with detailed comments on an initial draft of these
proposed rule revisions. In general, they suggested expanding the
universe of acceptable regulatory vehicles that you could use to
substitute for Federal standards. Our detailed response, including
clarification of what regulatory vehicles may and may not be used under
what circumstances, is contained in section VI.B.2. below.
B. What Actions Have EPA Taken To Address S/L's Concerns?
This section describes the rule changes and policy clarifications
that we are making, or have already made, in response to your comments
and suggestions.
1. Summary of Flexibility Added to Subpart E Prior to These Proposed
Amendments
Even before this rulemaking action, we took several steps to
address your concerns. As a first step, through a direct final Federal
Register notice that was published on July 10, 1996 (see 61 FR 36295,
``Approval of State Programs and Delegation of Federal Authorities,''
Direct final rule), we made various changes to the rule language in
subpart E. Because there were no adverse comments, the direct final
rule became effective on August 19, 1996. That rulemaking effected the
following changes:
(1) It deleted a duplicative requirement in Sec. 63.93 that sources
report the results of all required monitoring or testing at least every
6 months under an approved S/L rule or program. This requirement was
duplicative of reporting requirements already included in individual
NESHAP standards and the title V permit program regulations.
(2) It clarified the process for ``straight'' delegation of future
NESHAP standards through a single, advance program approval.
(3) It established the regulatory framework under which you can
obtain section 112(l) approval for S/L programs that create federally
enforceable limits on sources' potential to emit HAP.
(4) It delayed the requirement that you coordinate with the
Chemical Safety and Hazard Investigation Board (established by section
112(r)) until the board is convened.
In addition, since August 1995, we issued two policy memoranda to
clarify the flexibility that we believe already exists under Sec. 63.93
for making equivalency determinations between S/L and Federal rules.
(See, (1) ``Section 112(l) Submittal Equivalency Determination--
Recordkeeping Requirements, John S. Seitz, Director, Office of Air
Quality Planning and Standards (MD-10) to David Howekamp, Director, Air
and Toxics Division, Region IX, June 26, 1995.'' and (2)
``Clarification to the June 26, 1995 Memorandum, `Section 112(l)
Submittal Equivalency Determinations--Recordkeeping Requirements', John
S. Seitz, Director, Office of Air Quality Planning and Standards (MD-
10), Regional Air Division Directors, November 26, 1996.'' Both memos
are located in the docket.) These memoranda clarified our
interpretation of the ``holistic'' approval criteria in
Sec. 63.93(b)(2) as it is currently written. Essentially, we stated
that, in order to demonstrate the equivalency of your substitute rules
(or other requirements or authorities) with one of our NESHAP
standards, you must demonstrate that your rule would result in
equivalent emissions reductions. Provided you can demonstrate that the
level of control and MRR of your rule, when taken as a whole, result in
equivalent or better overall emissions reductions, and provided that
your requirements do not compromise Federal enforceability, the
existing subpart E regulations allow us to approve your compliance
measures even when they differ from our rules in form and stringency.
In other words, line-by-line equivalency with the Federal rule for MRR
is not required if your alternative rule as a package is demonstrated
to be as stringent as the Federal standard. However, we would not
approve a less stringent emission limit with very stringent MRR. Your
emission limits must be as stringent as the Federal emission limits. In
the November 26, 1996 memorandum, we further clarified that, under a
Sec. 63.93 approval, line-by-line equivalency is not required to obtain
approval. In addition, we stated our intention that the flexibility
discussed in the June 26, 1995 memorandum regarding the record
retention period be granted ``when evaluating any alternative
compliance measures, including recordkeeping and reporting
requirements, provided that Federal enforceability is not diminished in
this process.''
2. Summary of Flexibility Added to Subpart E Through These Proposed
Amendments
Through this action, we are proposing various regulatory changes to
subpart E to provide additional flexibility to you in how you may
accept delegation for the Federal section 112 program, including how
you are required to establish the equivalency of your alternative
requirements. These changes augment the flexibility already provided in
our July 10, 1996 rulemaking. In addition to proposing regulatory
changes, we are providing new policy guidance that clarifies: (1) Our
interpretations of the existing regulations and guidance documents; (2)
our expectations regarding the equivalency demonstration process; (3)
[[Page 1889]]
our expectations regarding equivalency demonstrations for alternative
work practice standards and General Provisions; and (4) the types of
situations that each subpart E delegation/approval option is designed
to address. That is, we have clarified when we think it is appropriate
for you to pursue a delegation request under each option according to
the circumstances in your jurisdiction.
Overall, the revised subpart E regulation and accompanying policy
guidance provide the following additional flexibility:
(1) more substitution options;
(2) holistic equivalency demonstration (covering both emissions
limits and MRR) showing that the S/L rules and requirements, seen as a
whole, are equivalent to the Federal MACT standards, rather than a
line-by-line equivalency determination and ``form of the standard''
requirement;
(3) same equivalency demonstration test for the rule substitution,
equivalency by permit (EBP), and SPA options (which are discussed at
length in the next section);
(4) expedited processes for approving alternative section 112
requirements under the new EBP and SPA processes;
(5) mechanisms for approving and implementing alternative section
112 requirements for area sources;
(6) increased options in regulatory vehicles for alternatives
(which are discussed later in this section);
(7) approval of some kinds of alternative work practice standards
without having to quantify their effect on emissions; and
(8) approval of alternative General Provisions (as found in 40 CFR
part 63, subpart A) based on a tiered classification scheme that allows
for different approval criteria depending on the nature of the General
Provisions requirement.
We have also added an option to this rule to partially approve S/L
rules or programs. We believe that if the majority of your rule or
program submitted for approval under section 112(l) meets the subpart E
criteria, then you should get approval of that portion of the rule or
program that meets the requirements. This option provides an additional
means to minimize the dual regulation effect that the original subpart
E rulemaking was designed to address. Therefore, a program that you
submit under this subsection may provide for partial or complete
delegation of the Administrator's authorities and responsibilities to
implement and enforce emissions standards and prevention requirements,
but may not include authority to set standards less stringent than
those promulgated by the EPA.
In their current form, subpart E provisions limit us to a binary
choice of either complete approval or complete disapproval. In other
words, if you make an adequate equivalency demonstration for your S/L
rule in its entirety, we would grant full approval of your rule or
program to be used in place of the corresponding Federal requirement.
However, if any part of the demonstration is found lacking, we would
disapprove the submittal in its entirety.
We believe that partial approval of your air toxics rules and
programs and accidental release prevention programs (ARPP) is
reasonable, is authorized by statute, and is a viable policy option.
Section 112(l)(1) of the Act specifically allows for either ``partial
or complete delegation'' of EPA's authorities and responsibilities. In
addition, this partial approval option will facilitate implementation
of section 112(l) in circumstances where it would make good sense, as
discussed further below.
Under this approval option, you would submit your S/L rule or
program for our approval. If we find that a separable portion of your
rule fails to meet any of the criteria of sections 63.92, 63.93, 63.94,
63.95, or 63.97, then we would not approve that portion of your rule or
program. We are proposing to define ``separable portion'' as a
section(s) of a rule or a portion(s) of a program which can be acted
upon independently without affecting the overall integrity of the rule
or program as a whole. We could still approve the remaining portion,
provided that we determine that such partial approval would not unduly
confuse the regulated sources or public nor confuse the delegation
process itself. The Federal rule would continue to apply in place of
the portion of your rule that was disapproved.
For example, we would consider the scenario where you only wished
to implement and enforce NESHAP standard(s) adopted by reference into
S/L law, but only as these standards apply to title V sources, as a
separable portion that we could delegate to you.
To add a twist to the example in above, if we determine that the
criminal enforcement provisions in your rule are not applicable to
covered area sources, then we would approve the rest of your submittal
and deny delegation of the rule as to criminal enforcement for area
sources.
Again, in this case, all criminal enforcement of area sources would
be our responsibility, and you would refer all such matters to the
appropriate Regional Office for investigation and resolution. You
should not have to resubmit the entire proposal with reference to the
criminal enforcement for area sources removed, merely so that we could
approve the whole package. We would also specify which portions of the
S/L rule or program are not approvable. This is another case where it
is much more efficient for both you and us for us to allow for partial
approval.
Another situation where partial approval could be used is where
your rule or program covers a subcategory or subcategories of the
source affected by a Federal standards, but not necessarily all sources
covered by that standard. These must be logical and compelling
subcategories (for example, hard but not decorative chrome plating, or
storage tanks of a particular size at several different types of
facilities).
There are cases where we believe that partial approval is
inappropriate. An example is the case where the test methods in the
alternative rule are inadequate. Since the test methods are linked to,
and are thus an integral part of, the specific level of control of a
standard, we cannot deem the test methods a ``separable portion.''
Consequently, we could not approve part of a submittal that specifies
the level of control and disapprove the part that specifies the test
methods associated with that level of control.
If you submit a rule or program with deficient MRR, then your rule
or program could be partially disapproved as to these areas of
deficiency. At some point, however, sources and governmental agencies
may become confused if there are too many separate provisions, some of
which are delegated and others not. If we determine that there are too
many areas of deficiency or if separating the responsibilities between
the Federal and State Government would be too cumbersome, then we may
disapprove your whole rule or program and ask that it be resubmitted in
a form that is closer to complete approval with only a few areas that
must be disapproved. We are under no duty to approve rules or programs
in part. We reserve the right to disapprove your rules and programs
entirely, if in our judgment, partial approval is not workable.
If you, in preconsultation with us, are aware of the deficiencies
in your submittal, you can merely leave the deficient parts out. In
this case, your submittal would include reference to any deficiencies.
As a practical matter, all parties will not be aware of all deficiency
issues that may arise in the course of a review. That is why partial
[[Page 1890]]
approval authority allows us to selectively approve the satisfactory
portions of the submittal and is therefore, a more efficient mechanism.
We are soliciting comments on appropriate uses of the partial approval
option.
We have received recent comments from CARB, who suggested expanding
the universe of acceptable regulatory vehicles that you could use to
substitute for Federal standards when regulatory adjustments therein
are fairly straightforward. The following are our positions on the use
of each of those specific suggestions:
(1) Proposed rules: Proposed rules cannot be used to substitute for
Federal standards, simply because proposed rules are subject to change,
and there is no process for us to review those changes after we have
approved substitution of your proposed rule.
(2) Permits: (a) Title V Permit Conditions: You may use title V
permit conditions to substitute for a Federal standard under any of the
options outlined in this rule, except for rule adjustment (Sec. 63.92).
However, as we explain in section 8.C. below, you may only use a
maximum of five title V permits to substitute for each Federal maximum
achievable control technology (MACT) standard, unless you choose to
develop General permits under the SPA option.
(b) General Permit Conditions: You may use General permit
conditions under title V for any number of sources under the SPA option
outlined in Sec. 63.97 of this rule. The great advantage of using
General permit conditions is that we would approve specific permit
terms and conditions up-front, through the subpart E approval process,
and you would not then need to go through rulemaking at the S/L level.
Of course, the General Permit must establish specific terms and
conditions for all emissions points and compliance measures covered by
the Federal MACT standard and any other applicable requirements.
(c) Permit Templates: As we understand it, a permit template is
different from a general permit in that the permit template would
contain an outline for what each permit should look like, but would not
contain specific permit terms and conditions for each emissions point.
Therefore we believe that you could use permit templates under the SPA
option, provided that we approve both the permit template and the
individual permits, in order to make the individual permits federally
enforceable. Because we would need to approve individual permits, we
believe, consistent with our equivalency by permit approach, that
permit templates should only be used for five or fewer sources in a
source category. However, we request comment on how we could allow use
of permit templates for more sources in a source category.
(d) Previously-Issued S/L Permit Conditions: As with title V
permits, you may substitute previously-issued S/L permit conditions for
a Federal standard for five or fewer sources in a source category.
These previously-issued permits do not have to be initially federally
enforceable to be submitted for approval, because our approval and
subsequent rulemaking will confer Federal enforceability on them.
Either the SPA option (Sec. 63.97) or rule substitution option
(Sec. 63.93) may be used to approve these permits, but not the rule
adjustment option (Sec. 63.92). The rule adjustment option only
pertains to minor pre-approved changes to Federal standards through S/L
rulemaking. In addition, if a previously-issued S/L permit is used to
substitute for a Federal standard, and is later modified, that
modification must be subject to both public and EPA review.
(e) Enforcement Orders: A S/L level enforcement order, such as a
board order in California, could be allowed, only so long as the
enforcement order contains enough specific detail to meet our
requirements for demonstrating equivalency (for example, the
enforcement order should contain a level of detail comparable to the
detail contained in a title V permit). In addition, you must provide
legal assurance that the enforcement order will automatically be
translated to a permit after it expires. We are seeking comments on the
use of enforcement orders as a mechanism to demonstrate equivalency
with federal standards.
(3) Subcategorization: In CARB's comments, they suggest that
different approval options could be used for different subcategories of
sources within a source category regulated by a Federal MACT standard.
We agree, within certain limits. You must create logical and compelling
subcategories of sources that are clear and simple to delineate and
understand, such as area versus major sources, new versus existing
sources, or different source types within a Federal source category or
NESHAP (for example, hard versus decorative chromium electroplating).
In addition, our proposed revisions to Sec. 63.91 allow for partial
approval of S/L rules (see discussion in section VII.C.2. below), which
we would envision as being similar to subcategorization.
(4) Direct Final Rulemaking: You have requested that we use direct
final rulemaking, rather than the usual procedures of separate proposed
and final rules, in approving substitute S/L authorities. You say using
direct final rulemaking would greatly expedite the approval process.
Direct final rulemakings are generally only used when adverse comments
are not expected. That determination must be made on a rule-by-rule
basis, so a generic provision in subpart E that requires the use of
direct final rulemakings in a wide variety of circumstances would be
inappropriate. However, on a rule-by-rule basis, we will continue to
evaluate the appropriateness of direct final rulemaking.
(5) Title V Approval in lieu of Rulemaking: You have requested that
we allow use of the title V permit approval process as a way of
avoiding up-front S/L rulemaking for all options under subpart E. We
believe we can only provide this mechanism under Sec. 63.94 (the
equivalency by permit option). A proposed title V permit is approved if
EPA does not act on it within 45 days; therefore the possibility exists
that a S/L could substitute its requirements for a Federal standard
without adequate EPA review. The equivalency by permit process is
limited to five or fewer sources, which provides greater assurance to
us that we will be able to review all permit changes within 45 days.
3. Sacramento Protocol
One issue you have raised is the length of time and the amount of
effort required to demonstrate equivalency with Federal requirements.
In July 1997, we entered into a delegation and program integration
initiative, called the Sacramento Protocol, with the CARB and the South
Coast Air Quality Management District (SCAQMD) to determine whether
identified State and District air pollution control requirements are
technically equivalent to the requirements found in five Federal
NESHAPs, and whether the demonstration of equivalency could be
developed quickly. The five Federal NESHAPs selected for the initiative
were:
Chromium Electroplating
Secondary Lead Smelting
Aerospace Manufacturing
Gasoline Distribution
Wood Furniture Manufacturing
The Sacramento Protocol team developed a process to evaluate the
requirements of the five NESHAP. The first step in the process was to
prepare tables that compared the SCAQMD/CARB requirements and the
NESHAP requirements. After review of the tables,
[[Page 1891]]
EPA identified questions and potential issues for which we needed more
information. We went to Southern California to observe inspections of
sources in these categories, which allowed the team members to
evaluate, ``in the field,'' the differences between the S/L and Federal
requirements. The inspections also provided us an opportunity to
evaluate SCAQMD permits and their associated conditions, the permit
evaluation process, inspection staff capability, the inspection
process, source compliance status, and local rule structure.
As a part of the inspections, the team expanded and added further
detail to the regulation comparison tables. After completing the
comparisons between the S/L requirements and the NESHAP requirements,
the team made one of four conclusions regarding each of the NESHAP
requirements in relation to the corresponding S/L requirements. First,
the team found many of the CARB and SCAQMD requirements to be directly
equivalent to the NESHAP requirements. Second, a similar number of CARB
and SCAQMD requirements could be made equivalent to the NESHAP
requirements by making changes or revisions to the applicable permits
or rules. Third, for some NESHAP requirements, the end result of the
comparison appeared equivalent, but there remained some uncertainty
about the determination. Consequently, the team recommended specific
conditions to ensure equivalency and, with these conditions, viewed the
requirements as technically equivalent. However, in recognition that
the equivalency decisions reached in this effort may set a precedent
for future decisions, the team believed that these issues should be
referred to CARB and EPA management for final resolution. Fourth, for
some requirements the team ``agreed to disagree.'' The disagreements
centered on differences of opinion about the equivalency of a
substitute requirement or on the necessity of a particular NESHAP
requirement.
Most of this work, including completing the equivalency
demonstration, was completed within 2 months. We believe the Sacramento
Protocol initiative clearly shows that equivalency demonstrations can
be evaluated in a timely fashion if they contain all the elements
needed in a regulation comparison table. Other ways to streamline this
process include keeping the EPA Regional Offices apprised of your
intentions, and contacting the EPA Regional Offices prior to the
submittal of an equivalency demonstration when you know that there may
be significant issues with your submittal.
The Sacramento Protocol initiative was also beneficial in providing
us with experience in evaluating S/L equivalency demonstrations and in
teaching us more about how the rule substitution process works. We also
believe that we learned where we could provide additional flexibility
for alternative requirements. As part of this learning experience, we
decided that our position on work practice standards could be modified
(see section X.E. below). We also worked with CARB and SCAQMD in
determining how rule effectiveness studies and frequent inspection
programs could be substituted for some MRR requirements. For more
information concerning the Sacramento Protocol, you may obtain a copy
of ``The Sacramento Protocol Final Report'' by contacting Mr. Tom
Driscoll at the address and telephone number referenced earlier. This
report is also on EPA's TTN website, also referenced earlier.
C. Summary of Proposed Regulatory Changes to Subpart E
As we previously discussed, subpart E as currently promulgated
provides four ways to receive delegation for section 112 regulations:
(1) Sec. 63.91 delegation of unchanged Federal standards;
(2) Sec. 63.92 rule adjustment;
(3) Sec. 63.93 authorities substitution; and
(4) Sec. 63.94 program substitution.
In this proposed rulemaking we are proposing that there be five
ways to receive delegation:
(1) Sec. 63.91 delegation of unchanged Federal standards;
(2) Sec. 63.92 rule adjustment;
(3) Sec. 63.93 substitution of authorities;
(4) Sec. 63.94 equivalency by permit (EBP); and
(5) Sec. 63.97 program approval.
Table 1 compares the current structure of subpart E in terms of the
content of each section to the structure we are proposing in these
regulatory amendments. The primary changes we are proposing are to
replace the current program substitution process in Sec. 63.94 with the
new EBP process and to add the new SPA process to
Sec. 63.97.2 One way to think of these amendments is that we
divided the former program substitution process into two separate, but
related, new approval options: the EBP process, which is similar in
effect to the existing program substitution process except that it may
be used only for a small number of sources per source category, and the
SPA process, which covers a large number of sources and is similar to
the rule substitution process. These process options are discussed and
compared in detail in sections VIII. and IX. of this preamble. In
addition, we are proposing a number of minor changes to other sections
to support these more significant regulatory amendments.
---------------------------------------------------------------------------
\2\ Although we would prefer to have all the delegation process
options appear in sequential sections of subpart E, we have
intentionally skipped over sections 63.95 and 63.96 in order to
avoid disrupting existing citations to these sections in other
regulatory text and guidance materials. We believe that, on the
whole, the approach we are proposing will be less confusing and less
burdensome to implement.
---------------------------------------------------------------------------
1. Proposed Changes to Sec. 63.90
For Sec. 63.90 we are proposing to add and modify a number of
subpart E's definitions. We are proposing to revise the definition for
``level of control'' to say, ``Test methods and associated procedures
and averaging times are integral to the level of control'' in order to
make explicit that test methods and associated procedures and averaging
times must be considered in assessing the emissions limitation portion
of the level of control and that they are not part of compliance and
enforcement measures. We are also proposing to revise the definition of
``compliance and enforcement measures'' to delete reference to test
methods and procedures.
[[Page 1892]]
Table 1.--Structure of Subpart E Before and After Proposed Regulatory Changes
----------------------------------------------------------------------------------------------------------------
Section No. in 40 CFR part 63, Title and content of section in Title and content of section in
subpart E existing regulations proposed new regulations
----------------------------------------------------------------------------------------------------------------
63.90........................... Program Overview...................... Program Overview
63.91........................... Criteria Common to all approval Criteria Common to all approval
options. options
63.92........................... Approval of a S/L rule that adjusts a Approval of a S/L rule that adjusts a
section 112 rule. section 112 rule
63.93........................... Approval of S/L authorities that Approval of S/L authorities that
substitute for a section 112 rule. substitute for a section 112 rule
63.94........................... Approval of a S/L program that Approval of S/L permit terms and
substitutes for section 112 emissions conditions that substitute for
standards. section 112 emissions standards
63.95........................... Additional approval criteria for Additional approval criteria for
Federal accidental release prevention Federal accidental release prevention
programs. programs
63.96........................... Review and withdrawal of approval..... Review and withdrawal of approval
63.97........................... [Reserved]............................ Approval of a State program that
substitutes for section 112
requirements
63.98........................... [Reserved]............................ [Reserved]
63.99........................... Delegated Federal authorities......... Delegated Federal authorities
----------------------------------------------------------------------------------------------------------------
We are proposing to add a definition for ``alternative
requirements'' because this term is used throughout the amendments to
subpart E. We are requesting comment on whether this definition is
useful and whether it is complete in its current wording. We have also
revised the definition for ``program'' to make it more appropriately
reflect how this term is used throughout the subpart E regulations as
they exist, and as we are proposing to amend them.
We are also proposing to add a definition to that subsection for
the term ``partial approval,'' and to amend the existing definition of
``approval'' in Sec. 63.90(a) to make it consistent with the proposed
definition of ``partial approval.'' We are seeking comment on these
changes. In addition, we are adding new definitions for ``minor * *
*,'' ``intermediate * * *,'' and ``major changes to a test method,''
and ``minor * * *,'' ``intermediate * * *,'' and ``major changes to
monitoring'' to help explain which General Provisions discretionary
authorities may be delegated to S/L's under Sec. 63.91 (see section
VI.C.2. below).
Finally, we are proposing to add a new paragraph to Sec. 63.90 to
address how tribal governments may apply for delegation pursuant to the
Tribal Air Rule in 40 CFR part 49.
2. Proposed Changes to Sec. 63.91
In Sec. 63.91(b), we clarify that you may cite or refer to
documents that you are required to submit for an approval under this
subpart when these documents are readily accessible to us and to the
public. This would save you the trouble of having to submit hard copies
of documents that we already have or that we may obtain in other ways,
for example, electronically.
We have also added a paragraph to address what S/L's must do to
update their section 112(l) approvals when we amend, repeal, or revise
previously promulgated Federal section 112 requirements that affect
sources. Section 63.91(c)(3) would require that if we revise a MACT
standard upon which you have based an equivalency demonstration for a
S/L rule, program, or permit, then you must revise that equivalency
demonstration within 90 days. We also propose to apply the same review
procedures to a revised equivalency demonstration as we would use for
an initial submittal under section 112(l). We request comment on these
requirements. We also request comment on whether you believe there is a
need for us to notify you, at the time when we revise a MACT standard,
of the need for you to submit a revised equivalency demonstration.
As discussed above in section VI.B.2, we are providing a mechanism
for partial approval of a S/L rule or program. We propose to edit
Sec. 63.91(a) and to insert Sec. 63.91(d)(2) to provide for such a
partial approval of a S/L's air toxics and ARPP authorities. The EPA is
seeking comments on this proposed edit and specifically on the approach
described.
Section 63.91(b)(1) currently requires you to provide a written
finding that you have the legal authority necessary to implement and
enforce your S/L rule and to assure compliance by all sources. At a
minimum, you must: (1) have enforcement authorities that meet the
requirements of 40 CFR 70.11; (2) have authority to request compliance
information; (3) have authority to inspect sources and records; and (4)
retain enforcement authority, if you, the S/L, delegate authorities to
a local agency, unless the local agency has authorities that meet
section 70.11. Section 63.91(b)(6) currently contains similar language
that requires you to satisfy criteria (1) and (4) above. We originally
included Sec. 63.91(b)(6) to ensure that a S/L did not receive approval
for rules or programs if it lacked sufficient enforcement authority.
We now believe, however, that Sec. 63.91(b)(1) ensures the
sufficiency of S/L enforcement authorities and that Sec. 63.91(b)(6) is
an unnecessary and redundant provision. Consequently, we propose to
delete Sec. 63.91(b)(6), and seek comments on the proposed deletion of
this duplicative requirement.
Under the Part 63 General Provisions, the EPA Administrator has the
authority to approve certain types of alternatives, or to make other
decisions under the General Provisions and the subparts. Questions have
been raised as to whether you may make the same discretionary decisions
when S/L are delegated the General Provisions. Section 63.91, as
promulgated in 1993, did not delineate which discretionary authorities
are delegated to you when you take ``straight'' delegation of the
General Provisions. Therefore Sec. 63.91(e)(1) to (e)(3) of this
proposal clarify which discretionary authorities may be delegated to
you through ``straight'' delegation of the General Provisions.
These provisions address your authority to make source-specific
decisions only, not source-category wide decisions. If you wish to make
discretionary decisions on a source-category-wide basis under the
General Provisions, then, as with other part 63 requirements, you would
need to use one of the other section 112(l) delegation processes to
substitute your own rule or program for a Federal rule or rules.
These new provisions provide clarity about those specific General
Provisions
[[Page 1893]]
authorities that would be nationally significant or would alter the
stringency of an underlying standard and thus, would not be delegated
to you. We believe that clarifying the delegation policy of the General
Provisions' authorities will help promote national consistency.
These new provisions are intended to be generally consistent with
previous policies developed for both New Source Performance Standards
(NSPS) under part 60, and for changes to State implementation plans
(SIP). Past guidance issued for NSPS discretionary changes has
permitted delegation to S/L's of all the Administrator's authorities
except those that require Federal rulemaking, or those for which
Federal oversight is critical to ensuring national consistency in the
application of Standards. (However, such delegations generally do not
give S/L's the authority to issue interpretations of Federal law that
are subsequently binding on the Federal Government). Current SIP
policy, as reflected in ``White Paper Number 2 for Improved
Implementation of the Title V Operating Permits Program 3,''
permits you to alter SIP requirements so long as the alternative
requirements are shown to be equally stringent and are within a pre-
approved protocol (and so long as public review is provided and EPA
approval is obtained).
---------------------------------------------------------------------------
\3\ Memorandum from Lydia Wegman, Deputy Director, OAQPS, to
Regional Air Division Directors, March 5, 1996.
---------------------------------------------------------------------------
The Part 63 General Provisions include 15 specific types of
determinations for which the Administrator may make discretionary
decisions on a source-specific basis. When the General Provisions are
delegated to a S/L agency, such discretion may be appropriately
delegated to the S/L agency, provided the stringency of the underlying
standard would not be compromised and/or decisions such as an approved
change would not be nationally significant.
We have divided the General Provisions discretionary authorities
into two groups, based upon the relative significance of each
discretionary type of decision. Category I contains those authorities
which can be delegated. We believe that the EPA Regional Office does
retain the authority to request review of these decisions, although we
expect that this authority will be exercised infrequently. Category II
contains those authorities which cannot be delegated.
In general, we believe that where possible, authority to make
decisions which are not likely to be nationally significant or to alter
the stringency of the underlying standard, such as minor changes to
test methods, should be delegated to you. (Note, however, that the
authority to approve decreases in sampling times and volumes when
necessitated by process variables has typically been delegated in
conjunction with the minor changes to test methods, but these types of
changes are not included within the scope of minor changes defined in
Sec. 63.90.) Therefore, minimal EPA involvement is required. Section
63.91(e)(1)(ii) lists the authorities in category I, i.e., those
authorities which may be delegated.
Section 63.91(e)(3)(ii) lists the authorities in category II, which
includes those decisions which generally may result in a change to the
stringency of the underlying standard, which is likely to be nationally
significant, or which may require a Federal Register notice. These
authorities, therefore, will always be retained by the EPA, and may not
be delegated to you.
3. Proposed Changes to Sec. 63.92
We have retained the provisions of Sec. 63.92 without significant
changes.
4. Proposed Changes to Sec. 63.93
Proposed changes to Sec. 63.93 are discussed in detail in section
VII.4. of this preamble. The significant change we are proposing is to
delete Sec. 63.93(a)(4)(ii), which specifies certain authorities that
may be approved under this section. We believe this change will not
affect the usefulness of this section to you.
5. Proposed Changes to Sec. 63.94
Table 2 summarizes the flexibility offered under the new
equivalency by permit process compared with the existing program
substitution process.
6. Proposed Changes to Sec. 63.95
Proposed changes to Sec. 63.95 are discussed in detail in section
XI. of this preamble. The major changes being proposed include
revisions needed to make these requirements consistent with the part 68
requirements, which implement the ARPP. We are also proposing to
clarify the authority of S/L's to have more stringent standards,
including lists with additional chemicals or lower thresholds. Finally,
we propose that S/L's may continue to request delegation for a full or
partial program, for a defined universe of sources, so long as you
accept delegation of the entire section 112(r) program for that defined
universe.
7. Proposed Addition to Sec. 63.97
Table 3 summarizes the flexibility offered under the new SPA
process compared with the existing program substitution and rule
substitution processes.
D. Policy Guidance Provided in the Preamble
This preamble provides policy guidance on the following topics:
Table 2.--Comparison Between Flexibility Under Existing and Amended Subpart E for Equivalency by Permit Process
----------------------------------------------------------------------------------------------------------------
Element of equivalency by permit
approval process Existing rule requires . . . New rule would allow or require . .
----------------------------------------------------------------------------------------------.-----------------
Equivalency demonstrations for Permit terms and conditions Permit terms and conditions
alternative section 112 in the form of the Federal standard not necessarily in the form of the
requirements. (63.94). Federal standard.
Line-by-line equivalency for Holistic equivalency for
levels of control and compliance and levels of control and compliance
enforcement measures (63.94). and enforcement measures.
Up-front approval.................. Up-front approval on S/L Up-front approval on S/L
authorities, commitments, and authorities and eligible sources.
eligible source categories--180 days No S/L rulemaking needed to
with rulemaking.. establish commitments.
Expedited up-front approval
process-90 days with rulemaking.
[[Page 1894]]
Approval of alternative That a title V permit be That a title V permit be
requirements. used to substitute S/L requirements used to substitute S/L requirements
for Federal requirements.. for Federal requirements.
EPA review and approval
required for all alternative
requirements, before public review
of permit--90 days without
rulemaking.
EPA and public review and EPA and public review and
comment during the permit issuance comment during the permit issuance
process. Affirmative EPA approval process. Affirmative EPA approval
not required--45 days. not required--45 days.
Section 112 program applicability.. Permit terms to be Permit terms to be
substituted for emissions standards substituted for section 112 (d),
established under sections 112 (d), (f), or (h) emissions standards.
(f), or (h) or other section 112
provisions.
----------------------------------------------------------------------------------------------------------------
Table 3.--Comparison Between Flexibility Under Existing and Amended Subpart E for State Program Approval Process
----------------------------------------------------------------------------------------------------------------
Element of state program approval
process Existing rule requires . . . New rule would allow or require . .
----------------------------------------------------------------------------------------------.-----------------
Equivalency demonstrations for Permit terms and conditions Permit terms and conditions
alternative section 112 in the form of the Federal standard not necessarily in the form of the
requirements. (63.94). Federal standard.
Line-by-line equivalency for Holistic equivalency for
levels of control and compliance and levels of control and compliance
enforcement measures (63.94). and enforcement measures.
Up-front approval.................. Up-front approval on S/L Up-front approval on
authorities, commitments, and authorities, source categories,
eligible source categories--180 days generic requirements,
with rulemaking (63.94). implementation mechanisms--90 or
180 days with rulemaking.
Approval of alternative EPA/public review and EPA/public review and
requirements. approval required for all approval required for all
alternative requirements--180 days alternative requirements--180 days
with rulemaking (63.93). with rulemaking
Substitutions on a source Substitutions on a source
category basis. category basis.
Area source mechanisms............. Substitutions for area Substitutions for area
source requirements by rule (63.93) source requirements on a source
or title V permit when sources are category basis through S/L
permitted under title V (63.94). enforceable mechanisms other than
rules or title V permits.
Alternative requirements must be
approved by rulemaking--180 days.
Section 112 program applicability.. Substitutions for emissions Substitutions for emissions
standards established under section standards established under section
112 (d), (f), or (h) or other 112 (d), (f), or (h) or other
section 112 provisions (63.94). section 112 provisions.
----------------------------------------------------------------------------------------------------------------
(1) Our interpretations of existing regulations and guidance (e.g.,
the holistic equivalency demonstration test);
(2) Our expectations regarding your submittal under the equivalency
demonstration process;
(3) Our expectations regarding equivalency demonstrations for
alternative work practice standards and general provisions;
(4) How the delegation/approval options work and compare with each
other, and the S/L situations they are designed to address;
(5) Functions of the up-front approval process in subpart E
delegation options; and
(6) Use of title V program approval to demonstrate that
Sec. 63.91(b) criteria have been met.
E. Policy Guidance Provided Outside the Preamble
Currently, we are developing guidance which will clarify in much
greater detail than the discussions provided in this preamble regarding
what we are looking for from you when you submit alternative
requirements for an equivalency demonstration. As part of this
guidance, we intend to provide a model equivalency demonstration
package that contains all the elements that are required in an
equivalency demonstration for a rule substitution and examples of how
we would evaluate equivalency for specific hypothetical requirements.
We are also developing guidance on demonstrating equivalency of WPS
that would provide examples of quantifiable and nonquantifiable part 63
WPS standards, what we might approve as alternatives, and our rationale
for the approval. Finally, we are preparing General Provisions guidance
that expands on the guidance provided in this preamble and explains the
criteria for how we would determine equivalency with each part 63
General Provisions requirement. We are seeking comments from you about
what other kinds of guidance would be most helpful.
VII. How Do the Revised Delegation Processes Work?
A. Sec. 63.93 Substitution of Authorities
In section VI.C.3. of the preamble, we presented a detailed
discussion about the administrative process requirements and
equivalency criteria for obtaining delegation/approval under the
substitution of authorities process in Sec. 63.93. Because we believe
that the approval criteria included in Sec. 63.93 already allow for a
``holistic'' review of substituted rules and authorities, we do not
believe that any regulatory changes to these criteria are necessary.
Thus, this proposal has not changed the equivalency criteria in this
option. Because we are not proposing in this rulemaking to amend any
aspects of the approval process or criteria under sections 63.93(a) and
(b), the previous
[[Page 1895]]
discussion in section VI.C.3. is still relevant.
In the following discussion we clarify and request comment on what
types of authorities you may substitute for section 112 rules under
Sec. 63.93, and we explain our rationale for proposing to amend rule
language that deals with this topic.
Under Sec. 63.93 as written, we can approve one (or more) of your
rules that is structurally different from the Federal rule for which
you wish to substitute your rule(s), or we may approve a rule that is
different from the Federal rule in ways that do not qualify for
approval under Sec. 63.92. Sec. 63.93 as written also allows us to
approve certain authorities (other than rules) that substitute for a
section 112 rule when these differ in form from the Federal section 112
rule. Under the existing rule language in sections 63.93(a)(4)(i) and
(a)(4)(ii), authorities that you may submit for approval under this
section include:
(1) Rules or other requirements enforceable under S/L law that
would substitute for a section 112 rule; or
(2) Specific title V permit terms and conditions for the source or
set of sources in the category for which you are requesting approval
when (a) the permit terms would substitute for standards promulgated
under section 112(h); (b) we have determined that your work practice,
design, equipment, or operational requirements are adequate under the
provisions of the Federal standard; and (c) you have an approved
program under sections 63.94.
We have reevaluated these provisions in light of the other changes
we are proposing to the delegation processes under subpart E and we
think that certain changes to these provisions may be warranted. First,
we are proposing to delete the provisions of Sec. 63.93(a)(4)(ii) (that
deal with specific title V permit terms and conditions that would
substitute for standards promulgated under section 112(h)) because we
believe it is no longer necessary to have a provision in Sec. 63.93 for
approval of alternative section 112(h) requirements that differ in form
from the Federal standard. Specifically,
(1) section 63.94 as amended would no longer require up-front
approval of legally binding S/L commitments, so these commitments
should not be a prerequisite for obtaining approval under Sec. 63.93;
(2) Section 63.94 as amended would require the same equivalency
test as Sec. 63.93 (i.e., you would no longer be required to submit
permit terms and conditions in the form of the Federal standard and
make a line-by-line equivalency demonstration), so that Sec. 63.94's
equivalency criteria should not be a prerequisite for obtaining
approval under Sec. 63.93;
(3) Section 63.94 as amended would require you to specify in your
up-front approval each source or source category (with five or fewer
sources in a category) for which you will submit alternative
requirements for approval in the future (in general 4), but
this requirement is not necessary for obtaining approval under
Sec. 63.93; and
---------------------------------------------------------------------------
\4\ This is generally the case, except when you submit your
draft permit terms and conditions at the same time that you submit
your request to use the equivalency by permit process. Regardless of
the timing of when you submit your permit terms and conditions under
revised Sec. 63.94, the ``up-front approval'' step in this process
only covers your demonstration of resources and authorities under
title V/Sec. 63.91(b) and your identification of sources that you
will cover under this delegation process.
---------------------------------------------------------------------------
(4) Under our revised policy for demonstrating equivalency with
WPS, we are no longer requiring that alternative WPS be expressed in
the same form as the Federal standard. (See the discussion in section
XI.E. of this preamble for a complete discussion of our rationale.)
Under the proposed rule revisions, Sec. 63.93(a)(4) would read as
follows: ``Authorities submitted for approval under this section shall
include State rules or other requirements enforceable under State law
that would substitute for a section 112 rule.''
Second, Sec. 63.93(a)(4)(i) specifies that you may submit for
approval under this section rules or other requirements enforceable
under S/L law that would substitute for a section 112 rule. We request
comments from you and other interested stakeholders to help us
understand and clarify what enforceable authorities other than S/L
rules may practicably be substituted under this option (including
authorities that would substitute for section 112(r) requirements). As
a policy matter, we believe it is appropriate to limit our review and
approval under Sec. 63.93 to authorities that are applied on a source
category-wide basis, rather than to individual sources (except when you
only have one source in a source category).5 In our proposed
scheme of amended delegation options, Sec. 63.93's purpose is to allow
us to approve your alternative rules on a rule-by-rule basis when you
wish to substitute rules for a relatively limited number of source
categories (compared with the SPA process). Depending on the comments
that we receive, we may delete reference to ``other requirements'' from
the description of authorities that may be approved under this section,
change Sec. 63.93(a)(4) to read ``Authorities submitted for approval
under this section shall include State rules (i.e., rules that are
enforceable under State law for categories of sources) that would
substitute for a section 112 rule,'' and change the title of Sec. 63.93
to ``Approval of a State rule that substitutes for a section 112
rule.''
---------------------------------------------------------------------------
\5\ Also, under Sec. 63.93, each approval action covers both the
generic Sec. 63.91(b) approval criteria and the substantive
alternative requirements that you will implement and enforce in lieu
of the Federal requirements for a specified source category. You
cannot obtain approval under Sec. 63.93 unless you submit the
enforceable conditions for that source category with your Sec. 63.93
submittal.
---------------------------------------------------------------------------
We are also clarifying that we believe you can implement
alternative compliance and enforcement strategies, on a rule-by-rule
basis, within the context of the existing regulations in Sec. 63.93.
This approach is discussed in section X.C., ``Using compliance
evaluation studies in equivalency demonstrations.''
B. Sec. 63.97 State Program Approval Process
To address some of your concerns with the existing substitution
options in subpart E, we developed the SPA process which, in this
rulemaking, we are proposing to add to Sec. 63.97. Although Sec. 63.97
numerically follows Sec. 63.94 in which we address the new EBP process,
we have chosen to discuss the SPA process before the EBP process to
enhance the overall clarity of the next sections of the preamble.
1. Background
In your comments and suggestions to us, you requested that we
explore ways to approve your alternative requirements in a more
expeditious manner. You also asked us to add more flexibility to the
program substitution process so you are not restricted to putting
alternative requirements into title V permits. This would allow you to
address area sources that are not covered by your title V programs.
Finally, you asked us to eliminate the requirements for line-by-line
equivalency demonstrations and the ``form'' of the Federal standard in
Sec. 63.94 as it is currently structured. This would give you more
flexibility in how you can demonstrate that your requirements are at
least as stringent as the Federal requirements.
The new SPA process addresses these concerns. Compared with the
existing program approval process in Sec. 63.94, the SPA process
provides you with additional flexibility by eliminating the ``form'' of
the standard and modifying equivalency requirements. Compared with the
existing rule substitution process in Sec. 63.93, it has the potential
to minimize the time and burden
[[Page 1896]]
associated with approving your alternative requirements, especially in
situations where you have a well-developed program with many comparable
requirements that apply to sources subject to Federal emissions
standards. The SPA process would allow you to obtain approval up-front,
and at one time, for generic alternative requirements that you wish to
apply to more than one source category (e.g., S/L general provisions,
work practice standards, or equipment standards). The SPA process also
would allow you to bundle groups of regulations or requirements and
submit them at one time for more efficient processing, or you could
submit requirements arising from multiple S/L rules to substitute for
requirements in a single NESHAP or other Federal section 112
regulation. The SPA process would allow you to substitute your
alternative requirements for Federal area source requirements using S/
L-enforceable mechanisms other than source category-wide rules. And,
finally, the SPA process would allow you to substitute your alternative
requirements for Federal section 112 requirements arising from section
112(f), the residual risk program, section 112(k), the urban area
source program, section 112(m), the Great Waters program, and others.
2. The Proposed State Program Approval Process
The SPA process, which would be codified in new Sec. 63.97, is
intended to provide an additional process option for you to obtain
approval of alternative requirements. The proposed SPA process is a
two-step process that we believe could expedite our approval of your
alternative requirements, provide you with more flexibility to submit
your alternative requirements in the future as the Federal regulations
are promulgated, and provide a more ``holistic'' approach for
determining whether or not an alternative requirement assures
compliance with the Federal standard or other requirement. (For a
discussion on how we will determine equivalency, see section X.)
Under the proposed SPA process, you could seek approval for a
program to be implemented and enforced in lieu of specified existing or
future section 112(d), section 112(f), or section 112(h) emissions
standards. In addition, you may seek programmatic approval to
substitute your alternative requirements for requirements under
sections 112(k), 112(m), 112(n), and 112(c)(6), but only after we have
promulgated regulations implementing those programs. You may not seek
approval under this process to implement and enforce alternative
section 112(r) requirements (that address section 112's Risk Management
Program); alternative section 112(r) requirements may be submitted
under Secs. 63.92, 63.93, and 63.95 of subpart E.
The proposed SPA process consists of two steps. In the first step,
you submit to us, and we approve your up-front program. Up-front
approval involves assuring that you have adequate authorities and
resources to implement and enforce your proposed substitute provisions,
as well as informing us of which source categories your program covers.
The up-front program approval consists of mandatory and optional
elements. The optional elements allow you to customize the program
approval to suit your particular needs, and they allow you to speed the
flow of the subsequent steps. The up-front approval takes place via
notice and comment rulemaking in the Federal Register and, as proposed,
it may take a maximum of 90 or 180 days to complete, depending on the
complexity of your submittal. In the second step, you submit to us, and
we approve your specific alternative requirements. These alternative
requirements may be submitted in the form of rules, permits, or
requirements in other enforceable mechanisms for major and/or area
sources but, as in Sec. 63.93, they must be enforceable as a matter of
S/L law before you can submit them for approval. Also, as in
Sec. 63.93, in step two of the SPA process, we approve your alternative
requirements through notice and comment rulemaking in the Federal
Register, and this process, as proposed, may take up to 180 days to
complete. Following completion of the SPA process, your approved
alternative requirements must be incorporated correctly into title V
permits, where required.
Both steps one and two are critical steps in the SPA process. In
these steps, we approve your authorities to substitute your alternative
requirements for Federal requirements, and your alternative
requirements become federally enforceable. (Until we approve your
alternative requirements, the otherwise applicable Federal requirements
continue to apply.) It is important to note, however, that steps one
and two need not take place separately in time. You may submit your
program approval elements and your alternative requirements for
simultaneous approval, for section 112 requirements that are already
promulgated at the time of your submittal.
Alternatively, you may submit your alternative requirements at a
future date (or multiple future dates), after the up-front approval has
been completed, for section 112 requirements that are not already
promulgated or for which you do not choose to substitute requirements
at the time of your up-front approval. Each time you submit your
alternative requirements at a future date after your up-front program
submittal, we would repeat the approval process under step two. (It is
not necessary to repeat the Sec. 63.91(b) demonstration and approval if
the basis for your earlier program approval has not changed.)
Under the SPA process, as for all the subpart E delegation/approval
processes, we act on your program by taking public comment on your
program submittal and promulgating a rule amending part 63 to
incorporate your program. (This was discussed in the original subpart E
proposal preamble at 58 FR pages 29297-98.) Because we are required to
publish a Federal Register notice to approve your program, we believe
it is appropriate to allow for at least a 90-day period for the up-
front approval step for submittals that do not contain any alternative
requirements, and the full 180 day-period for the up-front approval
step for submittals that do contain alternative requirements. These
time periods are consistent with the time periods allowed or proposed
for comparable review and approval steps for the other substitution
options in subpart E.
However, to address your concerns about how long it takes to
receive subpart E approval, we are committed to processing these
approvals as expeditiously as possible (i.e., in less than 90 or 180
days if possible). We are particularly interested in receiving comments
on whether an approval can take place in less than 180 days in
situations where the submittal includes alternative requirements
(especially when the equivalency comparison is complex). We are also
interested in your thoughts about whether and how both steps of the SPA
process could be completed in a combined total of 180 days, even when
the alternative requirements are submitted at a future date after the
up-front program approval has been completed. One suggestion is to
delay rulemaking on the up-front program approval until future
rulemaking takes place for approval of the alternative requirements;
although up-front rulemaking would be delayed, we could still evaluate
your submittal and prepare for the future rulemaking. (To help you
develop your comments, we refer you to timelines describing how steps
in the approval process would play out during the 180-day period. These
are included in the document entitled ``Interim Enabling Guidance for
the Implementation of 40
[[Page 1897]]
CFR part 63, subpart E,'' EPA-453/R-93-040, November 1993. This
document is included in the docket.)
In addition, to address your concerns about how long it takes to
receive subpart E approval, we have shortened the up-front approval
period to 90 days when your submittal does not contain any alternative
requirements. To accommodate the administrative process steps that are
required to take place during this period, we shortened the individual
time periods that are allowed or required for us to publish the
proposed Federal Register notice (from 45 to 21 days), for the public
to comment (from 30 to 21 days), for you to respond to the public
comments (from 30 to 14 days), and for us to prepare and publish the
final Federal Register notice (to about 30 days). We request comment on
whether these proposed time periods are feasible, adequate, and
acceptable for this purpose, given that we are trying to balance our
desire to expedite the approval process with our interest in allowing
the public sufficient time to comment. We have carried over this
approach to the EBP up-front approval process as well, and we are also
requesting comments on the application of this approach in that
context.
Based on our experience reviewing your alternative requirements
under the existing subpart E, we strongly recommend that you take steps
under the up-front portion of the SPA process to streamline the review
process for your alternative requirements. The following discussion on
up-front approval elements and criteria suggests how your submittal
could contribute toward simplifying and streamlining the process.
Alternatively, we recommend that you work with your EPA Regional Office
in advance of any formal submittal under the SPA process to get early
feedback on the approvability of your submittal elements. At its
discretion, your Regional Office may offer you a preliminary assessment
of your submittal, and it can advise you on how your submittal may be
improved, so that the formal approval process proceeds smoothly and
expeditiously. Your Regional Office also may be willing to work with
you to find mutually acceptable ways to shorten the review process. For
example, you could discuss what you will include in your equivalency
submittal package, the equivalency demonstration criteria you will
follow, and the style and format of your supporting analyses and
documentation, so that the Regional Office is likely to consider your
step two submittal complete; or you could discuss ways to speed the
administrative aspects of the approval process. While we have
eliminated the requirement to express your alternative requirements in
the form of the Federal standard, expressing them this way would make
the review and approval of your requirements go more easily and
quickly.
a. Step one: Up-front approval. i. Up-front approval elements and
criteria--The up-front approval step serves several critical functions
under the SPA process. As discussed earlier in this preamble: (1) it
assures that you have met the delegation criteria in section 112(l)(5)
and Sec. 63.91(b); (2) it provides the legal foundation by which
section 112 requirements may be replaced by your alternative
requirements (whether they arise from an enforceable S/L rule or permit
terms and conditions) such that your requirements become the federally
enforceable requirements in lieu of the applicable Federal
requirements; and (3) it provides for an orderly way of identifying
which authorities have been delegated to you in relation to specific
Federal emissions standards or requirements. In addition, the SPA up-
front approval gives you the opportunity to implement alternative
compliance and enforcement strategies (such as through the compliance
evaluation study approach discussed in section XI.C. of this preamble).
You also could obtain approval to implement and enforce alternative
requirements that apply generically to more than one category of
sources, and you could specify which enforceable mechanisms you will
use to substitute alternative requirements for area sources. Our intent
is that our one-time, up-front review and approval of these program
elements will streamline the subsequent review of your (additional)
alternative requirements for section 112 rules.
As a first step, as in the existing Sec. 63.94, you would submit
certain elements of your program for up-front approval. The up-front
program submittal under the SPA process must include, at a minimum, the
following two elements:
(1) Sec. 63.91(b) demonstration. The first element is a
demonstration of how you have satisfied the criteria in Sec. 63.91(b)
that address the basic adequacy of your program to accept delegation to
implement and enforce Federal section 112 requirements. These criteria
ensure that you have adequate authorities and resources to implement
and enforce the substituted provisions, including the authorities and
resources to implement your area source program. Title V program
approval may be sufficient to demonstrate that you have satisfied the
Sec. 63.91(b) criteria for sources covered by your title V program; and
(2) Identification of source categories and/or Federal section 112
requirements. The second element is an identification of the source
categories and/or the Federal section 112 requirements for which you
will accept delegation and for which you intend to substitute
requirements at that time or in the future. (Note, however, that you
cannot substitute requirements for a Federal requirement until it is
promulgated.)
In addition, depending on the design and complexity of your program
and what you want to achieve by substituting your program under the SPA
process, you may submit for approval one or more of the following
elements:
(3) Generic program requirements. You may obtain approval in this
step for generic alternative requirements that you intend to apply to
one or more source categories, e.g., if you have a different approach
to implementing the startup, shutdown, and malfunction plan required in
Sec. 63.6(e) of the part 63 General Provisions, or if you have a
different approach generally from the Federal requirements for
recordkeeping and reporting, preconstruction review, or any number of
other ``general provisions.'' In addition to general provisions, which
are often administrative in nature, you could obtain generic approval
for substantive control regulations (e.g., design, equipment, or
performance standards) that apply to more than one source category and
reduce emissions of HAP.
You could do a generic equivalency demonstration for these
requirements at this early stage in the SPA process. This early
demonstration of equivalency would help to expedite our review and
approval of your subsequent submittals for promulgated Federal
regulations, and it would allow the public to comment on the general
applicability of these approaches.
(4) Enforceable mechanisms for area source requirements. The next
element is a description of the mechanism(s), that is enforceable as a
matter of S/L law, that will be used to make your alternative
requirements for area sources federally enforceable when they are
approved during step two. In addition, you must include a demonstration
that you have adequate resources and authorities to implement and
enforce these mechanisms (or the requirements they generate).
Under the SPA process you may use S/L enforceable mechanisms, such
as S/L operating permits programs other than title V programs, to
develop and submit
[[Page 1898]]
for approval alternative requirements for area sources. A thorough
discussion of this topic follows.
(5) Alternative compliance and enforcement strategies. In addition,
if you elect to implement protocols that establish alternative
compliance and enforcement strategies (such as performing compliance
evaluation studies, which are discussed in section XI.C., below), we
must approve your proposal through rulemaking in the up-front approval
step. This approval may require you to supplement your previous
Sec. 63.91(b) demonstration if you need additional resources,
authorities, or requirements to implement the alternative strategies.
The advantage of including information from elements (3) or (5) in
your up-front submittal is that it would allow significant aspects of
your equivalency demonstration for specific Federal section 112
requirements to be addressed and worked out generically and in advance
of our and the public's review of your alternative requirements during
the subsequent step two phase. Consequently, it can result in a
decrease in the time it would otherwise take to review and approve your
regulations or permits for one or more source categories. In fact, we
believe that the benefits from developing these up-front understandings
may be significant, and we think this is one of the major advantages of
pursuing the SPA option.
ii. Process for making area source requirements federally
enforceable--One way that the SPA process is more flexible than the
existing program substitution process in subpart E is that the SPA
process may be implemented more readily for area sources. (The existing
program substitution process in Sec. 63.94 may be implemented for area
sources, but only if you will be permitting those sources under your
title V program. We understand that, in the near term, most title V
programs in the country will not cover the part 63 area sources that we
deferred from permitting. Nothing in this discussion, however, is
intended to deter you from using title V programs to permit area
sources.) We are proposing that, as part of the up-front SPA approval
process, you may submit a plan to implement your programs for area
sources, in addition to your plan for major sources. In this plan you
would identify the legally enforceable mechanism(s) that you would use
to implement and enforce your area source requirements. These legally
enforceable mechanisms may be either source category rules or general
permits (or a similar type of approach) that are specific to a source
category and are issued through a non-title V S/L permitting (or
similar) program. In either case, in step two we could approve these
rules or permits, that are already enforceable as a matter of S/L law,
in the same way that we can approve major source rules, that is,
through notice and comment rulemaking in the Federal Register. Whether
you regulate area sources through source category-wide rules, general
permits, or another enforceable mechanism, these rules become federally
enforceable upon approval of the specific alternative requirements in
step two. We are requesting comment on types of S/L enforceable
mechanisms other than rules and permitting programs that you may wish
to use for this purpose and specific descriptions of how you would use
these mechanisms.
We are also requesting comment on the types of criteria that an
enforceable S/L mechanism must satisfy, if any, to be acceptable as a
source of alternative requirements that may be approved under section
112(l). For example, we are requesting comment on whether, as a
condition of obtaining approval for area source requirements submitted
through a non-rule mechanism, the public within a S/L jurisdiction
should have adequate notice and opportunity to submit written comment
to the S/L during the process of developing the enforceable terms and
conditions that would become the approved alternative requirements.
Such programs obviously must have authority to cover the sources in the
source category, and individual HAP, if any, for which you are
requesting Sec. 63.97 approval, and you must have authority and
resources to implement and enforce the program's requirements. These
criteria would be satisfied by the Sec. 63.91(b) component of the up-
front approval. We would like your comments on whether we should
establish any additional specific approval criteria for such programs
through these amendments to subpart E.
For the revised regulation, we plan to review and approve general
permits, rules, requirements, or permit templates developed under
authority of your enforceable mechanism for area sources (or your title
V authority for major or area sources). We intend that Sec. 63.97
substitutions of requirements be applied on a source category-wide
basis, rather than to individual sources (except when you only have one
source in a source category). Each general permit or other approved
mechanism would take the place of a source category rule submitted for
approval under this option. As we explain in section VIII.C., which
describes the equivalency by permit process, we believe the use of
permits for demonstrating alternative requirements must be limited to
be implemented practicably, because of the burden associated with
reviewing individual permits containing alternative section 112
requirements expressed in a form that is different from that in the
underlying standard. Otherwise, we believe this approach will overtax
your ability to administer your programs and our ability to review your
permits within the specified time limits. This, in turn, could delay
the program approval process and adversely impact sources generally.
Therefore, except when you have only one source in a source
category (or possibly in other limited circumstances described below),
you must submit for review and approval general permits, rules,
requirements, or permit templates for either major or area sources. You
may submit more than one such mechanism for each source category (or
class of sources in a source category, e.g., major sources) provided
the collection of submittals ensures that all of the otherwise
applicable Federal section 112 requirements in the emissions standard
and all sources for that source category are addressed. We are taking
comment on this approach.
Your program for area sources need not apply to sources subject to
Federal standards for which you are not taking delegation under this
approval option. These sources would be subject to Federal standards or
your alternative requirements established under a different subpart E
option. However, your area source program must assure compliance with
all Federal section 112 emissions standards and requirements for which
you accept delegation under the SPA process.
Furthermore, to reduce the burden associated with implementing an
enforceable area source mechanism under subpart E, we are clarifying
that you may specify as part of your up-front subpart E program
approval that only the permit terms and conditions that are established
to substitute for Federal section 112 requirements need to undergo
public and EPA review and become federally enforceable through step 2
of the SPA process. We hope that this minimizes disruption to your
existing programs by allowing you to maintain the rest of your program
as is, or as S/L-enforceable only.
b. Step two: Approval of alternative section 112 requirements.
After or during the up-front approval, in step two of the SPA process,
you would submit to us the alternative requirements that you propose to
substitute for Federal section 112 requirements, and we would approve
or disapprove those requirements. We
[[Page 1899]]
would review and (dis)approve your alternative requirements for each
source category for which you wish to receive delegation to implement
alternative requirements. If we disapprove your substitution request,
you would proceed to implement the Federal rules. 6 For part
63 NESHAP or other Federal requirements that are already promulgated at
the time of your up-front submittal, step two may be combined with step
one, or it may occur after step one, depending on the status of your
existing rules or authorities. To be submitted for approval, your
alternative requirements must be enforceable as a matter of S/L law;
they may take the form of enforceable regulations, general permit terms
or conditions, administrative orders, board orders, or other legally
enforceable mechanisms in your jurisdiction. If the actual requirements
originate from policies instead of regulations, they may only be
submitted to us if they are included in an enforceable mechanism such
as a permit.
---------------------------------------------------------------------------
\6\ Under your approved up-front program, you would already have
been delegated the authority to implement and enforce those Federal
requirements.
---------------------------------------------------------------------------
Furthermore, the alternative requirements that you submit for a
particular NESHAP or other Federal requirement must apply to the entire
source category or subcategory. Under the SPA process, as under the
Sec. 63.93 process for substitution of rules, we will only review and
approve alternative requirements that do not require a source-specific
evaluation to determine their equivalency. This means that, if you are
using a permitting mechanism to make your requirements enforceable for
a source category, you could only submit general permits. (Earlier we
asked for comment on the feasibility and desirability of creating
limited exceptions to this policy.)
After we have determined whether your alternative requirements are
acceptable, the public would have 21 days to comment on your proposed
alternative requirements and our evaluation of them through a notice
and comment rulemaking published in the Federal Register. Then, after
considering the public comments and your responses to them, we would
act on your submittal by notifying you in writing as to whether we have
approved or disapproved your request for substitution. We would also
publish our findings in a final Federal Register notice. Because your
alternative requirements do not become federally enforceable or replace
the otherwise applicable Federal section 112 requirements until the
final Federal Register notice is published, we strongly recommend that
you begin your SPA approval process under step two in plenty of time to
receive approval before the first substantive compliance date for the
otherwise applicable Federal requirements. (By substantive compliance
date we mean a date by which the source is required to comply with
provisions to install and operate control equipment, make process
changes, or take other physical steps that reduce emissions of HAP to
the atmosphere.) For sources that need a long lead time to come into
compliance with your requirements or the otherwise applicable NESHAP
requirements, more than two years may be needed. We recommend that you
develop suitable timelines for implementing the SPA process steps with
your EPA Regional Office at the time of up-front approval, or as early
in the process as possible.
During the course of developing this proposed rulemaking, some of
you suggested that a 45-day review period (similar to the 45-day review
period for proposed title V operating permits) should be adequate for
acting on alternative section 112 requirements under the SPA process.
However, because of the potential complexity of equivalency
demonstrations, the application of approved alternatives to all sources
or groups of sources within the affected source category or subcategory
within your jurisdiction, and the need to do a rulemaking to approve
your source category-wide alternative requirements, we believe that 45
days is not adequate as the maximum allowable review period.
In developing the SPA process, we explored options under which we
could approve your alternative requirements in step two without the
need for additional Federal rulemaking, but the Act prohibits that. 42
U.S.C. Sec. 7697(d). See also, Administrative Procedures Act, 5 U.S.C.
Secs. 551, 553. Under the APA, Agency actions of general applicability
and future effect designed to implement the law are considered rules
and must undergo rulemaking. Approvals of your source category or
subcategory applicable alternative requirements, which will be
implemented and enforced in lieu of the Federal section 112 standards,
fall within the above description of a ``rule.'' Consequently, we must
undergo a rulemaking to grant such an approval.
c. Incorporation of alternative requirements into title V permits.
Following completion of step two of the SPA process, you would
incorporate the new federally applicable requirements into title V
permits for sources that are required to have such permits. This action
is important for several reasons relating to section 112(l)
substitutions of requirements. First, we and the public have an
opportunity to ensure that the approved alternative section 112
requirements are implemented correctly via the permit issuance process.
Second, the permit is a publicly available repository of the
requirements that apply to an affected source. We, you, the affected
source, and the public all have access to the same information about
what is required from that source.
Although we and the public have an additional opportunity to review
your alternative section 112 requirements during the permit issuance
process, this is not an opportunity to ``second guess'' the approval of
those requirements that took place during the step two review. The
purpose of the review during the permit issuance process is to ensure
that the terms and conditions of previously approved alternative
requirements are incorporated properly into the permit.
3. Changes to Previously Approved Alternative Requirements
After we have approved your alternative requirements (rules or
permit terms), if your alternative requirements then change in any way
that would change the approved section 112 provisions, you must
resubmit your rules or permits to us for reapproval in order for your
new alternative requirements to become federally enforceable in place
of the set of alternative requirements we previously approved.
Subsequently, if relevant, you must open and revise any federally
enforceable permits (or permit terms) that contain these alternative
section 112 requirements to bring them up to date with your revised,
approved alternative requirements. In other words, you must repeat step
two and revise your title V permits whenever your underlying
regulations, policies, or permits change so that your subpart E-
approved rules and permits correctly reflect your most current
requirements for those affected sources. As a matter of Federal
enforceability, until we approve your revised alternative requirements
under step two, sources remain subject to the applicable alternative
section 112 requirements that we approved previously. If your
alternative requirements originate from source category rules, you must
first submit those rules to us, as in step two, to obtain our approval
that the changed rules satisfy the equivalency demonstration criteria.
If your alternative requirements originate from policies that
result in permit terms and conditions, rather than from enforceable
rules, if you make any
[[Page 1900]]
changes to those policies, or if you implement those policies
differently from how they are expressed in the approved permit terms
and conditions, you must submit the revised permit terms and
conditions, as in step two, to obtain our approval that the changed
permit terms satisfy the equivalency demonstration criteria.
4. Criteria for Demonstrating Equivalency of Alternative Requirements
Under proposed Sec. 63.97(d), each individual submittal for
specific alternative requirements must:
(1) Identify the specific conditions that sources in the source
category must comply with under your requirements, including which of
these are alternative requirements that you want to implement and
enforce in lieu of the otherwise applicable Federal requirements. You
must submit copies of all S/L rules, regulations, permits,
implementation plans, or other enforceable mechanisms that contain the
entire set of requirements for which you are seeking approval,
including any alternative requirements, or if these documents are
readily available to us and the public, you may cite the relevant
portions of the documents or indicate where they are available;
(2) Identify how these conditions are the same as or different from
the relevant Federal requirements through a side-by-side comparison of
your requirements and ours. Your submittal must contain sufficient
detail for us to be able to make a determination of equivalency between
your alternative requirements and the Federal requirements;
(3) Provide detailed information that supports and justifies why
you believe that your alternative requirements, taken as a whole, are
no less stringent than the otherwise applicable Federal requirements,
that is, how they meet the equivalency criteria specified in
Sec. 63.93(b). For example, this equivalency demonstration must
demonstrate how your requirements will achieve equivalent or greater
emissions reductions compared to the Federal requirements for each
affected source.
We would then evaluate the specific alternative requirements by
using the equivalency ``test'' contained in Sec. 63.93(b). Section XI.
of the preamble contains a complete discussion on how we would conduct
an equivalency evaluation under the criteria of Sec. 63.93(b) to ensure
that the alternative requirements are no less stringent, taken as a
whole, than the otherwise applicable Federal requirements. (In the
future, we may supplement this discussion with additional guidance.)
C. Sec. 63.94 Equivalency by Permit Approval Process
1. Overview and Purpose of an Equivalency by Permit Process
Because of issues you raised about the current program substitution
process in Sec. 63.94, we are proposing to revise Sec. 63.94 to create
an equivalency by permit (EBP) approval process which does not include
a requirement for you to submit your alternative requirements in the
form of the Federal standard. The proposed EBP process would allow you
to substitute, for a limited number of sources, alternative
requirements and authorities that take the form of permit terms and
conditions instead of source category regulations. Under this three-
step process, you could seek approval to implement alternative section
112(d), section 112(h), or section 112(f) requirements that would be
enforced in lieu of part 63 emissions standards by submitting permit
terms and conditions that satisfy subpart E's equivalency demonstration
criteria. Once approved, these permit terms and conditions would be
included in a title V permit, through the appropriate title V permit
issuance process, to replace the otherwise applicable Federal
requirements. This process satisfies your request for a means of
obtaining delegation for a few sources without having to go through
rulemaking at the S/L level to establish source category-specific
regulations. It also allows you to substitute alternative requirements
on a source-specific basis for area sources when those sources are
permitted under title V.
The proposed EBP process accomplishes similar objectives to those
that the current Sec. 63.94 is intended to accomplish; however, the EBP
process provides flexibility beyond that now in Sec. 63.94 by allowing
a ``holistic'' approach for determining equivalency between your
alternative requirements and the Federal emissions standards. The
proposed EBP process differs from the current process in Sec. 63.94 in
that it does not require you to present your permit terms and
conditions in the form of the Federal standard in order to demonstrate
equivalency (although doing so may greatly reduce the time it takes to
approve your alternative requirements). Rather, it relies on the same
equivalency demonstration ``test'' that is currently in Sec. 63.93(b)
for rule substitutions and that we are proposing for the Sec. 63.97 SPA
process.
To balance this additional flexibility, we are proposing to add a
process step (i.e., step two, in which we review your draft permit
terms and conditions before they are included in proposed permits) and
limit the scope of applicability of the EBP process (i.e., allow the
EBP approach for 5 or fewer sources in a source category that is
affected by a NESHAP for which you want to substitute alternative
requirements). These ``checks and balances'' would ensure that the
results of EBP implementation are comparable to the results that would
be achieved through the other subpart E processes in terms of the types
of alternative requirements that could be approved, the opportunities
for public and EPA review of alternative requirements, and the overall
burden that would be associated with implementing this approach (for
you, for us, and for regulated sources). In addition, the checks and
balances would provide assurance that the proper emission reductions
are achieved. These concepts are explained further in the remainder of
this section of the preamble.
Essentially, the EBP process is appropriate when a source-specific
analysis is necessary to determine the effect of the alternative
requirements. In general, it is appropriate when you do not already
have S/L standards that apply to source categories regulated by part 63
emissions standards. For example, EBP could be appropriate for SIP-
approved rules that regulate HAP indirectly. Alternative requirements
may also arise from health-based or technology-based rules that
generate source-specific requirements based on a source's operations,
location, construction or modification activities, etc. Because each of
these situations requires a source-specific analysis, general permits
would not be appropriate under the EBP process.
The EBP process is similar to (but not the same as) the title V
permit streamlining process we developed for minimizing duplication
among multiple applicable requirements that apply to the same emissions
point at a source. (For guidance on permit streamlining, see our March
5, 1996 policy guidance document entitled ``White Paper Number 2 for
Improved Implementation of the Title V Operating Permits Program,''
commonly called White Paper 2, which can be found on our website at
http://www.epa.gov/ttn/oarpg/t5wp.html.) Through title V permit
streamlining, a source may elect to consolidate multiple applicable
requirements into a single set of applicable requirements that assure
compliance with each of the ``subsumed'' requirements to the same
extent as would be achieved by having
[[Page 1901]]
the source comply with each requirement independently. Through the EBP
process, you (as the permitting authority) may have Federal section 112
requirements replaced with your approved alternative requirements that
are no less stringent than the section 112 requirements that they
replace. Sources subject to the title V operating permits programs must
continue to meet the requirements of that program in addition to the
requirements of subpart E.
The EBP process differs from the rule substitution and the SPA
processes in that three steps are required under EBP to obtain our
approval for your alternative requirements. While all of the
substitution options require Federal rulemaking action to approve your
program elements (i.e., the Sec. 63.91(b) criteria and any other up-
front approval elements) and a step where we review and (dis)approve
your alternative requirements, the EBP process also requires a final
step where we review and (dis)approve how those alternative
requirements are incorporated into title V permit terms and conditions.
In the other substitution options, your alternative requirements are
approved by rulemaking and become federally enforceable after the
second step. In the EBP process, after approval of the S/L alternative
requirements, you must incorporate the approved permit terms and
conditions into Title V permits.
The EBP and SPA processes also differ in that the scope of
applicability for EBP is narrower than the scope for SPA. Under the SPA
process you submit and we approve alternative requirements that apply
to entire source categories; this approach may impact numerous sources
in many source categories. In contrast, under the EBP process, you
submit and we approve alternative requirements that apply to a small
number of individual sources in a category. These sources may or may
not comprise all the sources in that category in your jurisdiction. (If
they do not comprise all your sources in that category, you must accept
delegation for the remainder of your sources in the category under a
different subpart E delegation process.)
2. Steps in the Proposed Equivalency by Permit Process
a. Step one: Up-front approval. As a first step you would submit
certain elements of your program for up-front approval (as in the
existing Sec. 63.94 and the proposed SPA processes). The purpose of the
up-front submittal is for you to demonstrate that you have satisfied
the basic Sec. 63.91(b) criteria for obtaining delegation, demonstrate
that you have an approved title V permit program to implement the EBP
approach, and identify the sources in the source categories for which
you wish to use the EBP approach. (You may identify sources for which
part 63 emissions standards will be established in the future.)
In discussing the form that an EBP process could take, some of you
have suggested that an up-front approval would be redundant when you
already have an approved title V program. We disagree, at least in
part. As we already discussed for the SPA process, the State-specific
up-front approval for an EBP program serves critical functions under
section 112(l) including ensuring that you meet the Sec. 63.91(b)
criteria for delegation, providing a legal foundation for you to
replace the otherwise applicable Federal NESHAP requirements in your
permits with your alternative, federally enforceable requirements, and
delineating the specific sources and Federal emissions standards for
which you have accepted delegation. Also, as in the SPA process, the
up-front approval step allows us to verify that you have adequate
resources and authorities to implement your alternative section 112
requirements through your
This text is long and has been trimmed here. Open the source document for the complete record.
This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.