US EPA

FEDERAL REGISTER
VOL. 59, No. 209
Rules and Regulations

ENVIRONMENTAL PROTECTION AGENCY (EPA)

40 CFR Parts 52 and 81
[IN15-4-6647; FRL-5096-1]

Approval and Promulgation of Implementation Plans and Designation of Areas for Air Quality Planning Purposes; State of Indiana

59 FR 54391

DATE: Monday, October 31, 1994
ACTION: Final rule.

SUMMARY: On July 8, 1994, the United States Environmental Protection Agency (USEPA) published direct final rulemaking approving the redesignation of St. Joseph, Elkhart, Marion, and Vanderburgh Counties, Indiana to attainment of the ozone National Ambient Air Quality Standards (NAAQS) and their accompanying maintenance plans as State Implementation Plan (SIP) revisions. On the same day (July 8, 1994), a proposed rule was also published which established a 30-day public comment period noting that, if adverse comments were received regarding the direct final rule, the USEPA would withdraw the direct final rule and publish an additional final rule to address the public comments. Adverse comments were received during the public comment period and the USEPA published a withdrawal of the direct final rule on August 26, 1994. This final rule summarizes these comments and USEPA's responses and finalizes the approval of the redesignation of St. Joseph, Elkhart and Marion Counties. However, due to preliminary, non-quality industrial assured ozone data recently received from the State of Indiana for Warrick County, (which is adjacent to Vanderburgh County) indicating that a violation of the ozone standard may have occurred in 1994, USEPA is not finalizing the approval of the redesignation of Vanderburgh County at this time. The USEPA will address the Vanderburgh County redesignation request when an evaluation of these monitoring data are available.

EFFECTIVE DATE: This final rule will be effective November 30, 1994.

ADDRESSES: Copies of the SIP revision, public comments and USEPA's response are available for inspection at the following address: (It is recommended that you telephone Edward Doty at (312) 886-6057 before visiting the Region 5 Office.)

United States Environmental Protection Agency, Region 5, Air and Radiation Division, 77 West Jackson Boulevard, Chicago, Illinois 60604.

FOR FURTHER INFORMATION CONTACT: Edward Doty, Regulation Development Section (AR-18J), Regulation Development Branch, Air and Radiation Division, United States Environmental Protection Agency, Region 5, 77 West Jackson Boulevard, Chicago, Illinois 60604, Telephone Number (312) 886-6057.

SUPPLEMENTARY INFORMATION:

I. Background Information

The redesignation requests and maintenance plans discussed in this rule were submitted by the Indiana Department of Environmental Management (IDEM) for the following ozone nonattainment areas: South Bend/Elkhart (St. Joseph and Elkhart Counties, submitted on September 22, 1993); and Indianapolis (Marion County, submitted on November 12, 1993). On July 8, 1994, (59 FR 35044) USEPA published a direct final rule approving the redesignation requests and maintenance plans as revisions to the Indiana ozone SIP. On the same day, USEPA published a proposed rule noting that if adverse comments were received regarding the direct final rule, the USEPA would withdraw the direct final rule and publish another final rule addressing the public comments (For further information refer to 59 FR 35044 and 59 FR 36731). Adverse comments were received regarding the direct final rule and USEPA, therefore, withdrew the direct final rule on August 26, 1994, (59 FR 44040). The final rule contained in today's Federal Register addresses the comments which were received during the public comment period and announces USEPA's final action regarding the redesignation of St. Joseph, Elkhart and Marion Counties. The State of Indiana has provided the USEPA with preliminary, non-quality assured ozone data for Warrick County (which is adjacent to Vanderburgh County) indicating that a violation of the ozone standard may have occurred in 1994. During four days in 1994, June 18 through June 21, ozone standard exceedances may have been recorded at an Alcoa operated facility site (AIRS site 18-173-0002). The USEPA will defer final rulemaking on the redesignation of Vanderburgh County until an evaluation of these monitoring data are available for this period. Based on evaluation of these data, the redesignation of Vanderburgh County to attainment will have to be reconsidered. USEPA will summarize and respond to the adverse comments received regarding the Vanderburgh County redesignation in a subsequent final rulemaking action.

II. Public Comments and USEPA Responses

The following discussion summarizes and responds to the comments received regarding the redesignation of St. Joseph, Elkhart, and Marion Counties.

Comment

A commenter notes that, in reviewing Indiana's ozone redesignation request, the USEPA should consider the transport of ozone and ozone precursors into nonattainment areas currently part of the Lake Michigan Ozone Control Program (LMOP) (also referred to as the Lake Michigan Ozone Study [LMOS] area). Given the ongoing concerns about the control of transported ozone and ozone precursors as part of the attainment strategies being considered for the LMOP area, the commenter believes the Indiana ozone nonattainment areas (as well as those of Illinois, Michigan, and Wisconsin) should not be redesignated to attainment until the Lake Michigan Air Directors Consortium (LADCO) has conducted and completed an analysis of the ozone impacts of controlling transported ozone precursors.

USEPA Response

Although the 1991 field study conducted for LMOS produced high ozone concentrations aloft near the upwind edge of the LMOS modeling domain, implying transport of relatively high ozone concentrations into the LMOS domain, the 1991 field study did not establish the source(s) of the transported ozone. No studies have been conducted demonstrating that the Indiana nonattainment areas are the source areas responsible for the transported ozone. As there is currently no conclusive evidence that these Indiana areas are responsible for the transported ozone, USEPA does not believe that it would be appropriate to continue the nonattainment classification of these areas. USEPA further notes that these areas remain subject to obligations under sections 110(a)(2)(A) and 110(a)(2)(D) of the Clean Air Act (Act) to deal with ozone transport even after redesignation to attainment.

It should be noted that the LADCO States are conducting modeling analyses which will allow an assessment of the ozone impacts of controlling emissions in attainment areas as well as in ozone nonattainment areas. In addition, the USEPA is considering analyzing the impacts of some national controls covering both attainment areas and nonattainment areas through the use of the Regional Oxidant Model, which can cover a larger domain than the Urban Airshed Model used in LMOS and LMOP. The results of these modeling analyses may lead to new emission control requirements for attainment areas.

Comment

A commenter notes that the State of Indiana has not fully predicted the impact of future transportation projects and their effects on Vehicle Miles Travelled (VMT) and mobile source emissions growth. Specifically, the State of Indiana is planning to build a new four-lane highway between Marion and Vanderburgh Counties. In addition, the City of Indianapolis has recently proposed changes to its public transportation system, including the elimination of routes. Conformity analyses have not been performed for either of these proposals. The commenter argues that the September 4, 1992 redesignation guidance from USEPA's Director of the Air Quality Management Division, Office of Air Quality Planning and Standards, requires that the

State prove that its State Implementation Plan (SIP) provisions are consistent with the Act's section 176(c)(4) conformity requirements.

USEPA Response

The USEPA conformity rule (58 FR 62218) requires the States to conduct conformity analyses for both nonattainment areas and attainment areas subject to maintenance plans. The State is currently drafting its conformity rule to comply with USEPA's conformity rule. Therefore, any major federally funded and State funded projects in the areas redesignated to attainment by this action will be addressed through State conformity analyses and will be subject to the emissions budget established by the applicable maintenance plan. The Indianapolis- Evansville highway and any major modifications in public transportation will be subject to conformity analyses after Marion County is redesignated to attainment. If the changes to the public transportation system are minor, they are not required to be subject to conformity analyses.

Comment

A commenter has noted that the State has not shown that the improvements in air quality (occurring after the violation period of 1987 through 1989) are due to permanent and enforceable emission reductions as required in section 107(d)(3)(E)(iii) of the Act. The commenter argues that the September 4, 1992 USEPA redesignation policy guidance is clear in requiring analysis of whether the improved air quality has resulted in part from either unique meteorological condition or adverse economic conditions. Air quality improvements due to these air quality impacts are not permanent, and, therefore, are not creditable. These aspects have been neglected in both the State redesignation request and in USEPA's subsequent rulemaking.

USEPA Response

The September 4, 1992 USEPA policy guidance referred to by the commenter states that "[a]ttainment resulting from temporary reductions in emission rates (e.g., reduced production or shutdown due to temporary adverse economic conditions) or unusually favorable meteorology would not qualify as an air quality improvement due to permanent and enforceable emission reductions." Neither the State nor the USEPA has neglected these issues in preparing and analyzing Indiana's redesignation request. Rather, the USEPA believes that the State has adequately demonstrated that the improvement in air quality resulting in the attainment of the ozone standard is not due to temporary economic downturn or unusually favorable meteorology. As explained below, the State has made an adequate demonstration that the improvement in air quality in these Counties leading to attainment of the ozone standard was not due to temporary reductions in emission rates or to unusually favorable meteorology.

With respect to the issue of temporary emission reductions due to economic downturn, the USEPA noted in the July 8, 1994 direct final rulemaking (59 FR 35048), that the State has shown that attainment of the ozone standard is attributable to permanent and enforceable emission reductions that have occurred in Elkhart, Marion, and St. Joseph Counties. These emission reductions have resulted from source closures, implementation of emission controls on stationary sources (this included added emission reductions resulting from the correction of reasonably available control technology regulations in response to regulation deficiencies previously noted by the USEPA), implementation of the federal motor vehicle emission control program, and implementation of gasoline reid vapor pressure restrictions (Indiana implemented USEPA reid vapor pressure requirements, lowering reid vapor pressure limits to 9.0 pounds per square inch by 1992). All of these controls are permanent and enforceable. In the case of source closures, the source permits associated with these sources have been terminated and will not be reissued. Substantial emission reductions have occurred as a result of the imposition of permanent and enforceable emission controls, and it is USEPA's judgment that these reductions, rather than reductions attributable to any temporary economic downturn, are primarily responsible for the improvement in air quality that led to the attainment of the ozone standard in these Counties. The continued attainment status of these Counties in the years since the 1990-1992 period further indicates that temporary adverse economic conditions in the 1990-1991 period were not a significant factor in the attainment of the ozone standard in these Counties.

With respect to the issue of unusual meteorology, the State has compared the average meteorological parameters of maximum daily temperatures, daily mean wind speeds, percents of possible sunshine, and percents of relative humidity for the periods of May through August, 1990 through 1992, with the 30-year (1961-1990) norms for these parameters. In all three areas considered for redesignation, the 1990-1992 averages for these parameters agreed with those for the 30-year norms with only minor differences. Based on averaged parameters, it can be concluded that the 1990-1992 period was not atypically nonconducive to ozone formation. Thus, the State has adequately demonstrated that the air quality improvement was not due to unusually favorable meteorology.

Comment

A commenter notes that the failure to require correction of the State's part D New Source Review (NSR) program as a condition for approval of the area redesignations is in conflict with the Act and with USEPA guidance. The commenter notes that the USEPA rulemaking statement that part D NSR requirements are not generally applicable upon redesignation to attainment conflicts with section 107(d)(3)(E)(v) and is not justified in the USEPA guidance. The commenter notes that, although the USEPA September 4, 1992 policy memorandum implied that there is some flexibility in replacing part D NSR requirements with Prevention of Significant Deterioration (PSD) requirements, a subsequent USEPA September 17, 1993 policy clarification memorandum eliminated this flexibility.

The commenter also notes that the USEPA redesignation rulemaking erroneously allows the removal of existing part D NSR requirements, such as the requirements for offsets and Lowest Achievable Emission Rates (LAER). All of these existing programs disappear or are replaced by a part C PSD program. The commenter argues that the redesignations to attainment are not acceptable unless the NSR part D requirements are retained as contingency measures. It is noted that PSD for sources of ozone precursors does not require emission offsets for new sources, only requires Best Available Control Technology (BACT) emission controls rather than LAER, and has different source emission thresholds than does part D NSR. The implication is that shifting to PSD from part D NSR will weaken emission control requirements without adequate safeguards.

The commenter notes that the statement in the redesignation rulemaking that the section 175A(d) requirement (that all SIP measures be converted to contingency measures) should not apply to part D NSR because of the differing use of the term "measure" at section 161 of the Clean Air Act is irrelevant. The relevance of the part C (section 161) reference to a part D NSR requirement is questionable. The allusion to USEPA's historical practices do nothing to negate the explicit imperatives of the Clean Air Act and other USEPA guidance.

The commenter goes on to state that based on USEPA's logic in eliminating the part D NSR requirement, any and all other applicable part D requirements, including those which have been previously met and even relied upon in demonstrating attainment, could be eliminated without an analysis demonstrating that maintenance would be protected.

USEPA Response

USEPA believes that the areas that are the subject of Indiana's redesignation request may be redesignated to attainment notwithstanding the lack of a fully approved NSR program meeting the requirements of the 1990 Clean Air Act Amendments and the absence of such an NSR program from the contingency plan. This view, while a departure from the past policy, has been set forth by the USEPA as its new policy in a memorandum from Mary Nichols, Assistant Administrator for Air and Radiation ("Part D New Source Review (part D NSR) Requirements for Areas Requesting Redesignation to Attainment," October 14, 1994).

USEPA believes that its failure to insist on a fully approved NSR program as a pre-requisite to redesignation to attainment is justifiable as an exercise of the Agency's general authority to establish de minimis exceptions to statutory requirements. See Alabama Power Co. v. Costle, 636 F.2d 323, 360-61 (D.C. Cir. 1979). Under Alabama Power Co. v. Costle, the Agency has the authority to establish de minimis exceptions to statutory requirements where the application of the statutory requirements would be of trivial or no value environmentally.

In this context, the issue presented is whether the Agency has the authority to establish an exception to the requirement of section 107(d)(3)(E) that USEPA has fully approved a state implementation plan meeting all of the requirements applicable to the area under section 110 and part D of Title I of the Act. Plainly, the NSR provisions of section 110 and part D are requirements that were applicable to the Indiana areas seeking redesignation at the times of submission of the requests for redesignation. Thus, on its face, section 107(d)(3)(E) would seem to require that the State has submitted and USEPA has fully approved an NSR program meeting the requirements of the Act before the areas could be redesignated to attainment.

Under the Agency's de minimis authority, however, it may establish an exception to an otherwise plain statutory requirement if its fulfillment would be of little or no environmental value. In this context, it is necessary to determine what would be achieved by insisting that there be a fully approved NSR program in place prior to the redesignation of the Indiana areas. For the following reasons, USEPA believes that requiring the adoption and full approval of an NSR program prior to redesignation would not be of any significant environmental value in this case.

Indiana has demonstrated that maintenance of the ozone NAAQS will occur even if the emission reductions expected to result from an NSR program due to emission offsets do not occur. The emission projections made by Indiana to demonstrate maintenance of the NAAQS considered growth in point source emissions (along with growth for other source categories) and were premised on the assumption that PSD would be in effect, rather than NSR, during the maintenance period. Under NSR, significant point source emissions growth would not occur.

Indiana assumed that NSR would not apply after redesignation to attainment, and, therefore, assumed source growth factors based on projected growth in the economy and in the areas' populations. (It should be noted that the growth factors assumed may be overestimates under PSD, which would restrain source growth through the application of best available control techniques.) Thus, contrary to the assertion of the commenters, Indiana has demonstrated that there is no need to retain NSR as an operative program in the state implementation plan during the maintenance period in order to provide for continued maintenance of the NAAQS. (If this demonstration had not been made, NSR would have had to have been retained in the state implementation plan as an operative program since it would have been needed to maintain the ozone standard.)

The other purpose that requiring the full approval of an NSR program might serve would be to ensure that NSR would become a contingency provision in the maintenance plan required for these areas by sections 107(d)(3)(E)(iv) and 175A(d). These provisions require that, for an area to be redesignated to attainment, it must receive full approval of a maintenance plan containing "such contingency provisions as the Administrator deems necessary to assure that the State will promptly correct any violation of the standard which occurs after the redesignation of the area as an attainment area. Such provisions shall include a requirement that the State will implement all measures with respect to the control of the air pollutant concerned which were contained in the State implementation plan for the area before redesignation of the area as an attainment area." Based on this language, it is apparent that whether an approved NSR program must be included as a contingency provision depends on whether it is considered as a "measure" for the control of the pertinent air pollutants.

As USEPA noted in the proposed rulemaking regarding these redesignation requests, the term "measure" is not defined in section 175A(d) and Congress utilized that term differently in different provisions of the Act with respect to the PSD and NSR permitting programs. For example, in section 110(a)(2)(A), Congress required State implementation plans to include "enforceable emission limitations and other control measures, means, or techniques ... as may be necessary or appropriate to meet the applicable requirements of the Act." In section 110(a)(2)(C), Congress required that State implementation plans include "a program to provide for the enforcement of the measures described in subparagraph (A), and regulation of the modification and construction of any stationary source within the areas covered by the plan as necessary to assure that national ambient air quality standards are achieved, including a permit program as required in parts C and D." (Emphasis added.) If the term "measures" as used in sections 110(a)(2) (A) and (C) had been intended to include PSD and NSR there would have been no point to requiring that State implementation plans include both measures and preconstruction review under parts C and D (PSD and NSR). Unless "measures" referred to something other than preconstruction review under parts C and D, the reference to preconstruction review programs in section 110(a)(2)(C) would be rendered mere surplusage. Thus, in sections 110(a)(2) (A) and (C), it is apparent that Congress distinguished "measures" from preconstruction review. On the other hand, in other provisions of the Act, such as section 161, Congress appeared to include PSD within the scope of the term "measures."

Contrary to the comments in this proceeding, USEPA does not believe that the fact that Congress used the undefined term "measure" differently in different sections of the Act is "irrelevant." Rather, this indicates that the term is susceptible to more than one interpretation and that USEPA has the discretion to interpret it in a reasonable manner in the context of section 175A. Inasmuch as Congress itself has used the term in a manner that excluded PSD and NSR from its scope, USEPA believes it is reasonable to interpret "measure," as used in section 175A(d), not to include NSR. That this is a reasonable interpretation is further supported by the fact that PSD, a program that is the corollary of NSR for attainment areas, goes into effect in lieu of NSR. n1 This distinguishes NSR from other required programs under the Act, such as enhanced inspection and maintenance and reasonably available control technology, which have no corollary for attainment areas. Moreover, USEPA believes that those other required programs are clearly within the scope of the term "measure." n2

n1 USEPA is not suggesting that NSR and PSD are equivalent, but merely that they are the same type of program.

n2 USEPA also notes that, in the case of the Indiana areas, the possible contingency provisions include volatile organic compound (VOC) emission offsets for new and modified major sources; VOC emission offsets for new and modified minor sources; increasing the ratio of emission offsets required for new sources; and VOC controls on new minor sources (less than 100 tons per year). Furthermore, Indiana's construction permit program requires that, prior to constructing any source in any attainment or nonattainment area in the State, it must be demonstrated that the resultant emissions will not exacerbate an existing air quality violation or cause a new violation. This is consistent with USEPA's PSD requirements as specified at 40 CFR 52.21(k) and is provided for in Indiana's State implementation plan (see 40 CFR 52.793(b)).

USEPA disagrees with the commenters' suggestion that USEPA's logic in treating NSR in this manner means that other applicable part D requirements, including those that have been previously met and previously relied upon in demonstrating attainment, could be eliminated without an analysis demonstrating that maintenance would be protected. As noted above, Indiana has demonstrated that maintenance would be protected with PSD in effect, rather than NSR.

Thus, USEPA is not permitting NSR to be removed without a demonstration that maintenance of the standard will be achieved. Moreover, USEPA has not amended its policy with respect to the conversion of other State implementation plan elements to contingency provisions, which is that they may be converted to contingency provisions only upon a showing that maintenance will be achieved without them being in effect. Finally, as noted above, USEPA believes that the NSR requirement differs from other requirements, and does not believe that the rationale for the NSR exception extends to other required programs.

The position taken in this action is consistent with USEPA's current national policy. That policy permits redesignations to proceed without otherwise required NSR programs having been fully approved and converted to contingency provisions provided that the area demonstrates, as has been done in this case, that maintenance will be achieved with the application of PSD rather than NSR.

III. Final Rulemaking Action

The State of Indiana has met the requirements of the Act revising the Indiana ozone SIP. The USEPA approves the redesignation of St. Joseph, Elkhart and Marion Counties, Indiana to attainment of the ozone NAAQS. Final determination is being withheld for Vanderburgh County at this time. Further consideration of the Vanderburgh County redesignation will be made upon completion of the quality assurance of the Alcoa monitoring site data.

This action has been classified as a Table 2 action by the Regional Administrator under the procedures published in the Federal Register on January 19, 1989 (54 FR 2214-2225), as revised by an October 4, 1993, memorandum from Michael H. Shapiro, Acting Assistant Administrator for Air and Radiation. The Office of Management and Budget (OMB) has exempted this regulatory action from Executive Order 12866 review.

Nothing in this action should be construed as permitting or allowing or establishing a precedent for any future request for revision to any SIP. Each request for revision to any SIP shall be considered separately in light of specific technical, economic, and environmental factors and in relation to relevant statutory and regulatory requirements.

Under the Regulatory Flexibility Act, 5 U.S.C. 600 et seq., USEPA must prepare a regulatory flexibility analysis assessing the impact of any proposed or final rule on small entities. 5 U.S.C. 603 and 604. Alternatively, USEPA may certify that the rule will not have a significant economic impact on a substantial number of small entities. Small entities include small businesses, small not-for-profit enterprises, and government entities with jurisdiction over populations of less than 50,000.

The SIP approvals under section 110 and subchapter I, part D, of the Act do not create any new requirements, but simply approve requirements that the State is already imposing. Therefore, because the Federal SIP approval does not impose any new requirements, I certify that it does not have a significant impact on small entities affected. Moreover, due to the nature of the Federal-State relationship under the Act, preparation of a regulatory flexibility analysis would constitute Federal inquiry into the economic reasonableness of State action. The Act forbids USEPA to base its actions concerning SIPs on such grounds. Union Electric Co. v. USEPA, 427 U.S. 246, 256-66 (1976).

Under Section 307(b)(1) of the Act, petitions for judicial review of this action must be filed in the United States Court of Appeals for the appropriate circuit by December 30, 1994. Filing a petition for reconsideration by the Administrator of this final rule does not affect the finality of this rule for the purposes of judicial review nor does it extend the time within which a petition for judicial review may be filed, and shall not postpone the effectiveness of such rule or action. This action may not be challenged later in proceedings to enforce its requirements. (See section 307(b)(2).)

List of Subjects

40 CFR Part 52

Air pollution control, Carbon monoxide, Environmental protection, Hydrocarbons, Nitrogen dioxide, Ozone, Volatile organic compounds.

40 CFR Part 81

Air pollution control, Carbon monoxide, Environmental protection, Hydrocarbons, Nitrogen dioxide, Ozone, Volatile organic compounds.

Dated: October 14, 1994.

David A. Ullrich, Acting Regional Administrator.

Chapter I, title 40 of the Code of Federal Regulations is amended as follows:

PART 52-[AMENDED]

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

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

Subpart P-Indiana

2. Section 52.777 is amended by adding paragraph (f) to read as follows:

@ 52.777 -- Control strategy: Photochemical oxidants (hydrocarbons).

* * * * *

(f) Approval. The Indiana Department of Environmental Management submitted two ozone redesignation requests and maintenance plans requesting the ozone nonattainment areas to be redesignated to attainment for ozone: South Bend/Elkhart (St. Joseph and Elkhart Counties), submitted on September 22, 1993; Indianapolis (Marion County), submitted on November 12, 1993. The redesignation requests and maintenance plans meet the redesignation requirements in section 107(d)(3)(d) of the Act as amended in 1990. The redesignations meet the Federal requirements of section 182(a)(1) of the Clean Air Act as a revision to the Indiana Ozone State Implementation Plan for the above mentioned counties.

* * * * *

PART 81-[AMENDED]

1. The authority citation for part 81 continues to read as follows:

Authority: 42 U.S.C. 7401-7871q.

2. In @ 81.315 the Indiana-Ozone table is amended by revising the entries for "Indianapolis Area" and "South Bend-Elkhart Area" to read as follows:

@ 81.315 -- Indiana. 

* * * * * 

Indiana-Ozone 

    Designated areas                Designation 
                              Date fn 1          Type 
                      * * * * * * * 
Indianapolis Area: 
Marion County            November 30, 1994   Attainment 
                      * * * * * * * 
South Bend-Elkhart Area: 
Elkhart County           November 30, 1994   Attainment 
St. Joseph County        November 30, 1994   Attainment 
                      * * * * * * * 

Designated areas                  Classification 
                         Date fn 1           Type 

                      * * * * * * * 
Indianapolis Area: 

Marion County 
                      * * * * * * * 
South Bend-Elkhart Area: 
Elkhart County 
St. Joseph County 
                      * * * * * * * 

fn 1 This date is November 15, 1990, unless otherwise noted. 

* * * * *

[FR Doc. 94-26428 Filed 10-28-94; 8:45 am]

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