**ENVIRONMENTAL PROTECTION AGENCY**

**40 CFR Part 82**

**\[EPA- HQ-OAR-2006-1016; FRL-\]**

**RIN: 2060-A030**

**Protection of Stratospheric Ozone: The 2008 Critical Use Exemption
From the Phaseout of Methyl Bromide**

**AGENCY:** Environmental Protection Agency (EPA).

**ACTION:** Final Rule.

**SUMMARY:** EPA is finalizing an exemption to the phaseout of methyl
bromide to meet the needs of 2008 critical uses. Specifically, EPA is
authorizing uses that qualify for the 2008 critical use exemption and
the amount of methyl bromide that may be produced, imported, or supplied
from existing stocks for those uses in 2008. EPA is taking action under
the authority of the Clean Air Act to reflect recent consensus decisions
taken by the Parties to the Montreal Protocol on Substances that Deplete
the Ozone Layer (Protocol) at the 18^th^ Meeting of the Parties (MOP).

**DATES:** This rule is effective on **\[insert date of publication\]**.

**ADDRESSES:** EPA has established a docket for this action identified
under Docket ID No. EPA-HQ-OAR-2006-1016. All documents in the docket
are listed on the
[http://www.regulations.gov](http://www.regulations.gov/) site. Although
listed in the index, some information is not publicly available, e.g.,
CBI or other information whose disclosure is restricted by statute.
Certain other material, such as copyrighted material, is not placed on
the Internet and will be publicly available only in hard copy form.
Publicly available docket materials are available only through
[www.regulations.gov](http://www.regulations.gov/) or in hard copy. To
obtain copies of materials in hard copy, please call the EPA Docket
Center at (202) 564-1744 between the hours of 8:30am-4:30pm E.S.T.,
Monday-Friday, excluding legal holidays, to schedule an appointment. The
EPA Docket Center's Public Reading Room address is EPA/DC, EPA West,
Room 3334, 1301 Constitution Ave. N.W., Washington, D.C.

**For Further Information Contact:** Aaron Levy by telephone at (202)
343-9215, or by e-mail at <levy.aaron@epa.gov> or by mail at Aaron Levy,
U.S. Environmental Protection Agency, Stratospheric Protection Division,
Stratospheric Program Implementation Branch (6205J), 1200 Pennsylvania
Avenue, N.W., Washington, D.C., 20460. You may also visit the Ozone
Depletion web site of EPA's Stratospheric Protection Division at
[www.epa.gov/ozone](http://www.epa.gov/ozone/index.html) for further
information about EPA's Stratospheric Ozone Protection regulations, the
science of ozone layer depletion, and other related topics.

**Supplementary Information:**

This final rule concerns Clean Air Act (CAA) restrictions on the
consumption, production, and use of methyl bromide (a class I, Group VI
controlled substance) for critical uses during calendar year 2008. Under
the Clean Air Act, methyl bromide consumption (consumption is defined
under the CAA as production plus imports minus exports) and production
was phased out on January 1, 2005 apart from allowable exemptions,
namely the critical use exemption and the quarantine and pre-shipment
exemption. With this action, EPA is authorizing the uses that will
qualify for the 2008 critical use exemption as well as specific amounts
of methyl bromide that may be produced, imported, or sold from stocks
for critical uses in 2008.

Section 553(d) of the Administrative Procedure Act (APA), 5 U.S.C.
Chapter 5, generally provides that rules may not take effect earlier
than 30 days after they are published in the **Federal Register**. EPA
is issuing this final rule under section 307(d) of the Clean Air Act,
which states: "The provisions of section 553 through 557 . . . of Title
5 shall not, except as expressly provided in this section, apply to
actions to which this subsection applies." CAA section 307(d)(1). Thus,
section 553(d) of the APA does not apply to this rule. EPA is
nevertheless acting consistently with the policies underlying APA
section 553(d) in making this rule effective on **\[Insert date of
publication\]**. APA section 553(d) provides an exception for any action
that grants or recognizes an exemption or relieves a restriction. This
final rule grants an exemption from the phaseout of methyl bromide.

**Table of Contents**

I. General Information

A.  Regulated Entities

    II\. What is Methyl Bromide?

    III\. What is the Background to the Phaseout Regulations for Ozone
    Depleting Substances?

    IV\. What is the Legal Authority for Exempting the Production and
    Import of Methyl Bromide for Critical Uses Authorized by the Parties
    to the Montreal Protocol?

    V. What is the Critical Use Exemption Process?

    A. A. Background of the Process

    B. How Does This Final Rulemaking Relate to Previous Critical Use
    Exemption Rulemakings?

    C. Critical Uses

    [D.]{.mark} [Critical Use Amounts]{.mark}

    [1. Background of Critical Use Amounts]{.mark}

    [2. Calculation of Available Stocks]{.mark}

    [3. Adjusting New Production and Import Amounts to Account for
    Available Stocks]{.mark}

    [4. Treatment of Carry-Over Material]{.mark}

    [5. Amounts for Research Purposes]{.mark}

    [6. Methyl Bromide Alternatives]{.mark}

    [E. Recordkeeping and Reporting]{.mark}

    F. The Criteria in Decisions IX/6 and Ex. I/4

    G. Emissions Minimization

    H. Critical Use Allowance Allocations

    I. Critical Stock Allowance Allocations and Total Volumes of
    Critical Use Methyl Bromide

    J. Stocks of Methyl Bromide

    VI\. Statutory and Executive Order Reviews

    A. Executive Order 12866: Regulatory Planning and Review

    [B. Paperwork Reduction Act]{.mark}

    C. Regulatory Flexibility Act

    D. Unfunded Mandates Reform Act

    E. Executive Order 13132: Federalism

    F. Executive Order 13175: Consultation and Coordination with Indian
    Tribal Governments

    G. Executive Order 13045: Protection of Children from Environmental
    Health and Safety Risks

    H. Executive Order 13211: Actions that Significantly Affect Energy
    Supply, Distribution, or Use

    I. National Technology Transfer and Advancement Act

    J. Executive Order 12898: Federal Actions to Address Environmental
    Justice in Minority Populations and Low-Income Populations

    K. Congressional Review Act

    **I.** **General Information**

    **A. Regulated Entities**

    Entities potentially regulated by this action are those associated
    with the production, import, export, sale, application, and use of
    methyl bromide covered by an approved critical use exemption.
    Potentially regulated categories and entities include:

  ----------- -----------------------------------------------------------
  Category NO Examples of Regulated Entities
  SID CODES?  

  Industry    Producers, Importers and Exporters of methyl bromide;
              Applicators, Distributors of methyl bromide; Users of
              methyl bromide, e.g., farmers of vegetable crops, fruits
              and seedlings; and owners of stored food commodities and
              structures such as grain mills and processors, agricultural
              researchers.
  ----------- -----------------------------------------------------------

The above table is not intended to be exhaustive, but rather to provide
a guide for readers regarding entities likely to be regulated by this
action. This table lists the types of entities that EPA is aware could
potentially be regulated by this action. To determine whether your
facility, company, business, or organization is regulated by this
action, you should carefully examine the regulations promulgated at 40
CFR Part 82, Subpart A. If you have questions regarding the
applicability of this action to a particular entity, consult the person
listed in the preceding section.

**II. What is Methyl Bromide?**

Methyl bromide is an odorless, colorless, toxic gas which is used as a
broad-spectrum pesticide and is controlled under the CAA as a class I
ozone-depleting substance (ODS). Methyl bromide is used in the U.S. and
throughout the world as a fumigant to control a variety of pests such as
insects, weeds, rodents, pathogens, and nematodes. Additional
characteristics and details about the uses of methyl bromide can be
found in the proposed rule on the phaseout schedule for methyl bromide
published in the **Federal Register** on March 18, 1993 (58 FR 15014)
and the final rule published in the **Federal Register** on December 10,
1993 (58 FR 65018). Information on methyl bromide can be found at
http://www.epa.gov/ozone/mbr and http://www.unep.org/ozone or by
contacting the Stratospheric Ozone Hotline at 1-800-296-1996.

Because it is a pesticide, methyl bromide is also regulated by EPA under
the Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA) and
other statutes and regulatory authority, as well as by States under
their own statutes and regulatory authority. Under FIFRA, methyl bromide
is a restricted use pesticide. Restricted use pesticides are subject to
certain Federal and State requirements governing their sale,
distribution, and use. Nothing in this proposed rule implementing the
Clean Air Act is intended to derogate from provisions in any other
Federal, State, or Local laws or regulations governing actions
including, but not limited to, the sale, distribution, transfer, and use
of methyl bromide. All entities that are affected by provisions of this
action must continue to comply with FIFRA and other pertinent statutory
and regulatory requirements for pesticides (including, but not limited
to, requirements pertaining to restricted use pesticides) when
importing, exporting, acquiring, selling, distributing, transferring, or
using methyl bromide for critical uses. The regulations in this final
rule are intended only to implement the CAA restrictions on the
production, consumption, and use of methyl bromide for critical uses
exempted from the phaseout of methyl bromide.

**II. What is the Background to the Phaseout Regulations for
Ozone-Depleting Substances?**

The current regulatory requirements of the Stratospheric Ozone
Protection Program that limit production and consumption of
ozone-depleting substances can be found at 40 CFR part 82, subpart A.
The regulatory program was originally published in the **Federal
Register** on August 12, 1988 (53 FR 30566), in response to the 1987
signing and subsequent ratification of the Montreal Protocol on
Substances that Deplete the Ozone Layer (Protocol). The Protocol is the
international agreement aimed at reducing and eliminating the production
and consumption of stratospheric ozone depleting substances. The U.S.
was one of the original signatories to the 1987 Montreal Protocol and
the U.S. ratified the Protocol on April 12, 1988. Congress then enacted,
and President George H.W. Bush signed into law, the Clean Air Act
Amendments of 1990 (CAAA of 1990) which included Title VI on
Stratospheric Ozone Protection, codified as 42 U.S.C. Chapter 85,
Subchapter VI, to ensure that the United States could satisfy its
obligations under the Protocol. EPA issued new regulations to implement
this legislation and has made several amendments to the regulations
since that time.

Methyl bromide was added to the Protocol as an ozone-depleting substance
in 1992 through the Copenhagen amendment to the Protocol. The Parties to
the Montreal Protocol (Parties) agreed that each industrialized
country's level of methyl bromide production and consumption in 1991
should be the baseline for establishing a freeze in the level of methyl
bromide production and consumption for industrialized countries. EPA
published a final rule in the **Federal Register** on December 10, 1993
(58 FR 65018), listing methyl bromide as a class I, Group VI controlled
substance, freezing U.S. production and consumption at this 1991 level
of 25,528,270 kilograms, and, in 40 CFR 82.7 of the rule, setting forth
the percentage of baseline allowances for methyl bromide granted to
companies in each control period (each calendar year) until 2001, when
the complete phaseout would occur. This phaseout date was established in
response to a petition filed in 1991 under sections 602(c)(3) and 606(b)
of the CAAA of 1990, requesting that EPA list methyl bromide as a class
I substance and phase out its production and consumption. This date was
consistent with section 602(d) of the CAAA of 1990, which for newly
listed class I ozone-depleting substances provides that "no extension
\[of the phaseout schedule in section 604\] under this subsection may
extend the date for termination of production of any class I substance
to a date more than 7 years after January 1 of the year after the year
in which the substance is added to the list of class I substances." EPA
based its action on scientific assessments and actions by the Parties to
the Montreal Protocol to freeze the level of methyl bromide production
and consumption for industrialized countries at the 1992 Meeting of the
Parties in Copenhagen.

At their 1995 meeting, the Parties made adjustments to the methyl
bromide control measures and agreed to reduction steps and a 2010
phaseout date for industrialized countries with exemptions permitted for
critical uses. At that time, the U.S. continued to have a 2001 phaseout
date in accordance with the CAAA of 1990 language. At their 1997
meeting, the Parties agreed to further adjustments to the phaseout
schedule for methyl bromide in industrialized countries, with reduction
steps leading to a 2005 phaseout for industrialized countries.

**IV. What is the Legal Authority for Exempting the Production and
Import of Methyl Bromide for Critical Uses Authorized by the Parties to
the Montreal Protocol?**

In October 1998, the U.S. Congress amended the CAA to prohibit the
termination of production of methyl bromide prior to January 1, 2005, to
require EPA to bring the U.S. phaseout of methyl bromide in line with
the schedule specified under the Protocol, and to authorize EPA to
provide exemptions for critical uses. These amendments were contained in
Section 764 of the 1999 Omnibus Consolidated and Emergency Supplemental
Appropriations Act (Pub. L. 105-277, October 21, 1998) and were codified
in Section 604 of the CAA, 42 U.S.C. 7671c. The amendment that
specifically addresses the critical use exemption appears at Section
604(d)(6), 42 U.S.C. 7671c(d)(6). EPA revised the phaseout schedule for
methyl bromide production and consumption in a direct final rulemaking
on November 28, 2000 (65 FR 70795), which allowed for the phased
reduction in methyl bromide consumption and extended the phaseout to
2005. EPA again amended the revised phaseout to allow for an exemption
for quarantine and preshipment purposes on July 19, 2001 (66 FR 37751)
with an interim final rule and with a final rule on January 2, 2003 (68
FR 238).

On December 23, 2004 (69 FR 76982), EPA published a final rule titled
"Protection of Stratospheric Ozone: Process for Exempting Critical Uses
From the Phaseout of Methyl Bromide" (the "Framework Rule") in the
**Federal Register** that established the framework for the critical use
exemption; set forth a list of approved critical uses for 2005; and
specified the amount of methyl bromide that could be supplied in 2005
from stocks and new production or import to meet the needs of approved
critical uses. EPA then promulgated a second rule that added additional
uses to the exemption program for 2005 and allocated additional stock
allowances (70 FR 73604). EPA published a final rule on February 6,
2006, to exempt production and import of methyl bromide for 2006
critical uses and indicated which uses met the criteria for the
exemption program for that year (71 FR 5985). EPA published another
final rule on December 14, 2006, to exempt production and import of
methyl bromide for critical uses in 2007 and indicated which uses met
the criteria for critical uses for that year (71 FR 75386). Under
authority of section 604(d)(6) of the CAA, this action lists the uses
that qualify as approved critical uses in calendar year 2008 and the
amount of methyl bromide required to satisfy those uses.

This action reflects Decision XVIII/13, taken at the Eighteenth Meeting
of the Parties in October 2006. In accordance with Article 2H(5), the
Parties have issued several Decisions pertaining to the critical use
exemption. These include Decisions IX/6 and Ex. I/4, which set forth
criteria for review of proposed critical uses. The status of Decisions
is addressed in [NRDC v. EPA]{.underline}, (464 F.3d 1, D.C. Cir. 2006)
and in EPA's "Supplemental Brief for the Respondent," filed in [NRDC v.
EPA]{.underline} and available in the docket for this action. In this
final rule, EPA is honoring commitments made by the United States in the
Montreal Protocol context.

**V. What is the Critical Use Exemption Process?**

**A. Background of the Process**

Starting in 2002, EPA began notifying applicants of the process for
obtaining a critical use exemption to the methyl bromide phaseout. On
May 8, 2003, the Agency published its first notice in the **Federal
Register** (68 FR 24737) announcing the availability of the application
for a critical use exemption and the deadline for submission of the
requisite data. Applicants were informed that they may apply as
individuals or as part of a group of users (a "consortium") who face the
same limiting critical conditions (i.e. specific conditions that
establish a critical need for methyl bromide). EPA has repeated this
process annually since then. The critical use exemption is designed to
permit production and import of methyl bromide for uses that do not have
technically and economically feasible alternatives.

The criteria for the exemption initially appeared in Decision IX/6 of
the Parties to the Protocol. In that Decision, the Parties agreed that
"a use of methyl bromide should qualify as 'critical' only if the
nominating Party determines that: (i) The specific use is critical
because the lack of availability of methyl bromide for that use would
result in a significant market disruption; and (ii) there are no
technically and economically feasible alternatives or substitutes
available to the user that are acceptable from the standpoint of
environment and public health and are suitable to the crops and
circumstances of the nomination." These criteria are reflected in EPA's
definition of "critical use" at 40 CFR 82.3.

In response to the yearly requests for critical use exemption
applications published in the **Federal Register**, applicants have
provided data on the technical and economic feasibility of using
alternatives to methyl bromide. Applicants further submit data on their
use of methyl bromide, on research programs into the use of alternatives
to methyl bromide, and on efforts to minimize use and emissions of
methyl bromide.

EPA's Office of Pesticide Programs reviews the data submitted by
applicants, as well as data from governmental and academic sources, to
establish whether there are technically and economically feasible
alternatives available for a particular use of methyl bromide and
whether there would be significant market disruption if no exemption
were available. In addition, EPA reviews other parameters of the
exemption applications such as dosage and emissions minimization
techniques and applicants' research or transition plans. This assessment
process culminates with the development of a document referred to as the
"Critical Use Nomination" or CUN. The U.S. Department of State submits
the CUN annually to the United Nations Environment Programme (UNEP)
Ozone Secretariat. The CUNs of various countries are subsequently
reviewed by the Methyl Bromide Technical Options Committee (MBTOC) and
the Technical and Economic Assessment Panel (TEAP), which are
independent advisory bodies to Parties to the Montreal Protocol. These
bodies make recommendations to the Parties on the nominations. The
Parties then take a Decision to authorize a critical use exemption for a
particular country. The Decision also identifies how much methyl bromide
may be supplied for the exempted critical uses. As required in Section
604(d)(6) of the Clean Air Act, for each exemption period, EPA consults
with the United States Department of Agriculture and other departments
and institutions of the Federal government that have regulatory
authority related to methyl bromide, and provides an opportunity for
public comment on the amounts of methyl bromide that the Agency has
determined to be necessary for critical uses and the uses that the
Agency has determined meet the criteria of the critical use exemption.

For more information on the domestic review process and methodology
employed by the Office of Pesticide Programs, please refer to a detailed
memo titled "*Development of 2003* *Nomination for a Critical Use
Exemption for Methyl Bromide for the United States of America*"
available on the docket for this rulemaking. While the particulars of
the data continue to evolve and clerical matters are further
streamlined, the technical review itself has remained the same since the
inception of the exemption program.

On January 24, 2006, the U.S. Government (USG) submitted the fourth
*Nomination for a Critical Use Exemption for Methyl Bromide* *for the
United States of America* to the Ozone Secretariat of the United Nations
Environment Programme. This fourth nomination contained the request for
2008 critical uses. In March 2006, MBTOC sent questions to the USG
concerning technical and economic issues in the nomination. In April
2006 the USG transmitted responses to MBTOC's requests for
clarification. The USG received MBTOC's second-round of questions in
June 2006, and sent responses to MBTOC in August 2006. These documents,
together with reports by the advisory bodies noted above, can be
accessed in the public docket for this rulemaking. The determination in
this final rule reflects the analysis contained in those documents.

**B. How Does This Final Rulemaking Relate to Previous Critical Use
Exemption Rulemakings?**

The December 23, 2004 Framework Rule (69 FR 76982) established the
operational framework for the critical use exemption program in the
U.S., including trading provisions and recordkeeping and reporting
obligations. The Framework Rule defined the terms "critical use
allowances" (CUAs) and "critical stock allowances" (CSAs) at 40 CFR
82.3. Today's action authorizes the uses that will qualify as critical
uses for 2008 and the amounts of CUAs and CSAs that will be allocated
for those uses. The uses that EPA is authorizing as 2008 critical uses
are the uses which the USG included in the fourth CUN, and which were
approved by the Parties in Decision XVIII/13. In this action, EPA is
also refining its approach for determining the amount of CSAs to
allocate in 2008 and each year thereafter. EPA discusses the refined
approach in detail in Section V.D. of this preamble.

**C. Critical Uses**

In Decision XVIII/13, taken in October 2006, the Parties to the Protocol
agreed as follows: "for the agreed critical-use categories for 2008, set
forth in table C of the annex to the present decision for each Party to
permit, subject to the conditions set forth in the present decision and
decision Ex.I/4, to the extent that those conditions are applicable, the
levels of production and consumption for 2008 set forth in table D of
the annex to the present decision which are necessary to satisfy
critical uses ..."

The following uses are those set forth in table C of the annex to
Decision XVIII/13: Commodities, Cocoa beans (NPMA[^1] subset), NPMA food
processing structures (cocoa beans removed), Mills and processors,
Smokehouse ham, Cucurbits -- field, Eggplant -- field, Forest nursery,
Nursery stock -- fruit, nut, flower, Orchard replant, Ornamentals,
Peppers -- field, Strawberry -- field, Strawberry runners, Tomatoes --
field, Sweet potato slips. The agreed critical-use levels for 2008 total
5,355,946 kilograms (kg), which is equivalent to 21.0% of the U.S. 1991
methyl bromide consumption baseline of 25,528,270 kg. However, the
maximum amount of allowable new production and import as set forth in
table D of Decision XVIII/13 is 4,595,040 kg (18.0% of baseline). For
the reasons described in Section V.D. of this preamble, EPA is allowing
limited amounts of new production or import of methyl bromide for
critical uses for 2008 up to the amount of 3,098,981 kg (12.1% of
baseline), with 1,724,550 kg (6.8% of baseline) coming from stocks. To
clarify, while the Parties require only 760,906 kg of stockpile use if
the entire U.S. allotment is utilized, EPA is allowing use of 1,724,550
kg of stockpiles for critical uses and reducing allowable production
accordingly. \[Should consideration be given to the amount that the
Parties have required to be taken from stocks in 2009 by reducing the
1,724,550 by the 2009 requirement?\]

In this final rule, EPA is amending Columns B and C of Appendix L to 40
CFR Part 82, Subpart A to reflect the agreed critical-use categories
identified in Decision XVIII/13 for the 2008 control period (calendar
year). The Agency is amending the table of critical uses based, in part,
on the technical analysis contained in the 2008 U.S. nomination that
assesses data submitted by applicants to the critical use exemption
program as well as public and proprietary data on the use of methyl
bromide and its alternatives. EPA sought comment on the aforementioned
analysis and, in particular, any information regarding changes to the
registration or use of alternatives that may have transpired after the
2008 nomination was written. Such information has the potential to alter
the technical or economic feasibility of an alternative and could thus
cause EPA to modify the analysis that underpins EPA's determination as
to which uses and what amounts of methyl bromide qualify for the
critical use exemption.

EPA received three comments on the recent time-limited federal
registration of the soil fumigant iodomethane (methyl iodide), which
began October 2007. [EPA reviewed information about the registration of
iodomethane, and determined that at this time the registration of
iodomethane does not change the Agency's determination of which uses
qualify for the critical use exemption.]{.mark} The impact of the recent
time-limited registration of iodomethane on EPA's determination as to
what amounts of methyl bromide qualify for the critical use exemption is
discussed in Section V.D.6. of this preamble. Based on the information
described above, EPA is determining that the uses in Table I: Approved
Critical Uses, with the limiting critical conditions specified, qualify
to obtain and use critical use methyl bromide in 2008.

**Table I: Approved Critical Uses**

+------------+---------------------+-----------------------------------+
| Column A   | Column B            | Column C                          |
+------------+---------------------+-----------------------------------+
| **Approved | **Approved Critical | **Limiting Critical Conditions**  |
| Critical   | User and Location   |                                   |
| Uses**     | of Use**            | that either exist, or that the    |
|            |                     | approved critical user reasonably |
|            |                     | expects could arise without       |
|            |                     | methyl bromide fumigation:        |
+------------+---------------------+-----------------------------------+
| PRE-PLANT  |                     |                                   |
| USES       |                     |                                   |
+------------+---------------------+-----------------------------------+
| Cucurbits  | \(a\) Michigan      | Moderate to severe soilborne      |
|            | growers             | disease infestation               |
|            |                     |                                   |
|            |                     | A need for methyl bromide for     |
|            |                     | research purposes                 |
+------------+---------------------+-----------------------------------+
|            | \(b\) Southeastern  | Moderate to severe yellow or      |
|            | U.S. limited to     | purple nutsedge infestation       |
|            | growing locations   |                                   |
|            | in Alabama,         | Moderate to severe soilborne      |
|            | Arkansas, Kentucky, | disease infestation               |
|            | Louisiana,          |                                   |
|            | Mississippi, North  | Moderate to severe root knot      |
|            | Carolina, South     | nematode infestation              |
|            | Carolina,           |                                   |
|            | Tennessee, and      | A need for methyl bromide for     |
|            | Virginia            | research purposes                 |
+------------+---------------------+-----------------------------------+
|            | \(c\) Georgia       | Moderate to severe yellow or      |
|            | growers             | purple nutsedge infestation       |
|            |                     |                                   |
|            |                     | Moderate to severe soilborne      |
|            |                     | disease infestation               |
|            |                     |                                   |
|            |                     | Moderate to severe root knot      |
|            |                     | nematode infestation              |
|            |                     |                                   |
|            |                     | A need for methyl bromide for     |
|            |                     | research purposes                 |
+------------+---------------------+-----------------------------------+
| Eggplant   | \(a\) Florida       | Moderate to severe yellow or      |
|            | growers             | purple nutsedge infestation       |
|            |                     |                                   |
|            |                     | Moderate to severe soilborne      |
|            |                     | disease infestation               |
|            |                     |                                   |
|            |                     | Restrictions on alternatives due  |
|            |                     | to karst topographical features   |
|            |                     | and soils not supporting seepage  |
|            |                     | irrigation                        |
|            |                     |                                   |
|            |                     | A need for methyl bromide for     |
|            |                     | research purposes                 |
+------------+---------------------+-----------------------------------+
|            | \(b\) Georgia       | Moderate to severe yellow or      |
|            | growers             | purple nutsedge infestation       |
|            |                     | Moderate to severe nematode       |
|            |                     | infestation                       |
|            |                     |                                   |
|            |                     | Moderate to severe pythium        |
|            |                     | collar, crown and root rot        |
|            |                     |                                   |
|            |                     | Moderate to severe southern       |
|            |                     | blight infestation                |
|            |                     |                                   |
|            |                     | Restrictions on alternatives due  |
|            |                     | to karst topographical features   |
|            |                     |                                   |
|            |                     | A need for methyl bromide for     |
|            |                     | research purposes                 |
+------------+---------------------+-----------------------------------+
|            | \(c\) Michigan      | Moderate to severe soilborne      |
|            | growers             | disease infestation               |
|            |                     |                                   |
|            |                     | A need for methyl bromide for     |
|            |                     | research purposes                 |
+------------+---------------------+-----------------------------------+
| Forest     | \(a\) Growers in    | Moderate to severe yellow or      |
| Nursery    | Alabama, Arkansas,  | purple nutsedge infestation       |
| Seedlings  | Georgia, Louisiana, |                                   |
|            | Mississippi, North  | Moderate to severe soilborne      |
|            | Carolina, Oklahoma, | disease infestation               |
|            | South Carolina,     |                                   |
|            | Tennessee, Texas,   | Moderate to severe nematode       |
|            | and Virginia        | infestation                       |
+------------+---------------------+-----------------------------------+
|            | \(b\) International | Moderate to severe yellow or      |
|            | Paper and its       | purple nutsedge infestation       |
|            | subsidiaries        | Moderate to severe soilborne      |
|            | limited to growing  | disease infestation               |
|            | locations in        |                                   |
|            | Alabama, Arkansas,  |                                   |
|            | Georgia, South      |                                   |
|            | Carolina, and Texas |                                   |
+------------+---------------------+-----------------------------------+
|            | \(c\) Public        | Moderate to severe weed           |
|            | (government-owned)  | infestation including purple and  |
|            | seedling nurseries  | yellow nutsedge infestation       |
|            | in Illinois,        |                                   |
|            | Indiana, Kentucky,  | Moderate to severe Canada thistle |
|            | Maryland, Missouri, | infestation                       |
|            | New Jersey, Ohio,   |                                   |
|            | Pennsylvania, West  | Moderate to severe nematode       |
|            | Virginia, and       | infestation                       |
|            | Wisconsin           |                                   |
|            |                     | Moderate to severe soilborne      |
|            |                     | disease infestation               |
+------------+---------------------+-----------------------------------+
|            | \(d\) Weyerhaeuser  | Moderate to severe yellow or      |
|            | Company and its     | purple nutsedge infestation       |
|            | subsidiaries        |                                   |
|            | limited to growing  | Moderate to severe soilborne      |
|            | locations in        | disease infestation               |
|            | Alabama, Arkansas,  |                                   |
|            | North Carolina, and | Moderate to severe nematode or    |
|            | South Carolina      | worm infestation                  |
+------------+---------------------+-----------------------------------+
|            | \(e\) Weyerhaeuser  | Moderate to severe yellow         |
|            | Company and its     | nutsedge infestation              |
|            | subsidiaries        |                                   |
|            | limited to growing  | Moderate to severe soilborne      |
|            | locations in Oregon | disease infestation               |
|            | and Washington      |                                   |
+------------+---------------------+-----------------------------------+
|            | \(f\) Michigan      | Moderate to severe soilborne      |
|            | growers             | disease infestation               |
|            |                     |                                   |
|            |                     | Moderate to severe Canada thistle |
|            |                     | infestation                       |
|            |                     |                                   |
|            |                     | Moderate to severe nutsedge       |
|            |                     | infestation                       |
|            |                     |                                   |
|            |                     | Moderate to severe nematode       |
|            |                     | infestation                       |
+------------+---------------------+-----------------------------------+
|            | \(g\) Michigan      | Moderate to severe nematode       |
|            | herbaceous          | infestation                       |
|            | perennials growers  |                                   |
|            |                     | Moderate to severe soilborne      |
|            |                     | disease infestation               |
|            |                     |                                   |
|            |                     | Moderate to severe yellow         |
|            |                     | nutsedge and other weed           |
|            |                     | infestation                       |
+------------+---------------------+-----------------------------------+
| Orchard    | \(a\) Members of    | Moderate to severe nematode       |
| Nursery    | the Western         | infestation                       |
| Seedlings  | Raspberry Nursery   |                                   |
|            | Consortium limited  | Presence of medium to heavy clay  |
|            | to growing          | soils                             |
|            | locations in        |                                   |
|            | California and      | Prohibition on use of             |
|            | Washington          | 1,3-dichloropropene products      |
|            |                     | because local township limits on  |
|            |                     | use of this alternative have been |
|            |                     | reached                           |
|            |                     |                                   |
|            |                     | A need for methyl bromide for     |
|            |                     | research purposes                 |
+------------+---------------------+-----------------------------------+
|            | \(b\) Members of    | Moderate to severe nematode       |
|            | the California      | infestation                       |
|            | Association of      |                                   |
|            | Nursery and Garden  | Presence of medium to heavy clay  |
|            | Centers             | soils                             |
|            | representing        |                                   |
|            | Deciduous Tree      | Prohibition on use of             |
|            | Fruit Growers       | 1,3-dichloropropene products      |
|            |                     | because local township limits on  |
|            |                     | use of this alternative have been |
|            |                     | reached                           |
|            |                     |                                   |
|            |                     | A need for methyl bromide for     |
|            |                     | research purposes                 |
+------------+---------------------+-----------------------------------+
|            | \(c\) California    | Moderate to severe nematode       |
|            | rose nurseries      | infestation                       |
|            |                     |                                   |
|            |                     | Prohibition on use of             |
|            |                     | 1,3-dichloropropene products      |
|            |                     | because local township limits on  |
|            |                     | use of this alternative have been |
|            |                     | reached                           |
|            |                     |                                   |
|            |                     | A need for methyl bromide for     |
|            |                     | research purposes                 |
+------------+---------------------+-----------------------------------+
| Strawberry | \(a\) California    | Moderate to severe soilborne      |
| Nurseries  | growers             | disease infestation               |
|            |                     |                                   |
|            |                     | Moderate to severe yellow or      |
|            |                     | purple nutsedge infestation       |
|            |                     |                                   |
|            |                     | Moderate to severe nematode       |
|            |                     | infestation                       |
|            |                     |                                   |
|            |                     | A need for methyl bromide for     |
|            |                     | research purposes                 |
+------------+---------------------+-----------------------------------+
|            | \(b\) North         | Moderate to severe black root rot |
|            | Carolina and        |                                   |
|            | Tennessee growers   | Moderate to severe root-knot      |
|            |                     | nematode infestation              |
|            |                     |                                   |
|            |                     | Moderate to severe yellow and     |
|            |                     | purple nutsedge infestation       |
|            |                     |                                   |
|            |                     | A need for methyl bromide for     |
|            |                     | research purposes                 |
+------------+---------------------+-----------------------------------+
| Orchard    | \(a\) California    | Moderate to severe nematode       |
| Replant    | stone fruit growers | infestation                       |
|            |                     |                                   |
|            |                     | Moderate to severe soilborne      |
|            |                     | disease infestation               |
|            |                     |                                   |
|            |                     | Replanted (non-virgin) orchard    |
|            |                     | soils to prevent orchard replant  |
|            |                     | disease                           |
|            |                     |                                   |
|            |                     | Presence of medium to heavy soils |
|            |                     |                                   |
|            |                     | Prohibition on use of             |
|            |                     | 1,3-dichloropropene products      |
|            |                     | because local township limits on  |
|            |                     | use of this alternative have been |
|            |                     | reached                           |
+------------+---------------------+-----------------------------------+
|            | \(b\) California    | Moderate to severe nematode       |
|            | table and raisin    | infestation                       |
|            | grape growers       |                                   |
|            |                     | Moderate to severe soilborne      |
|            |                     | disease infestation               |
|            |                     |                                   |
|            |                     | Replanted (non-virgin) orchard    |
|            |                     | soils to prevent orchard replant  |
|            |                     | disease                           |
|            |                     |                                   |
|            |                     | Medium to heavy soils             |
|            |                     |                                   |
|            |                     | Prohibition on use of             |
|            |                     | 1,3-dichloropropene products      |
|            |                     | because local township limits for |
|            |                     | this alternative have been        |
|            |                     | reached                           |
+------------+---------------------+-----------------------------------+
|            | \(c\) California    | Moderate to severe nematode       |
|            | wine grape growers  | infestation                       |
|            |                     |                                   |
|            |                     | Moderate to severe soilborne      |
|            |                     | disease infestation               |
|            |                     |                                   |
|            |                     | Replanted (non-virgin) orchard    |
|            |                     | soils to prevent orchard replant  |
|            |                     | disease                           |
|            |                     |                                   |
|            |                     | Medium to heavy soils             |
|            |                     |                                   |
|            |                     | Prohibition on use of             |
|            |                     | 1,3-dichloropropene products      |
|            |                     | because local township limits for |
|            |                     | this alternative have been        |
|            |                     | reached                           |
+------------+---------------------+-----------------------------------+
|            | \(d\) California    | Moderate to severe nematode       |
|            | walnut growers      | infestation                       |
|            |                     |                                   |
|            |                     | Moderate to severe soilborne      |
|            |                     | disease infestation               |
|            |                     |                                   |
|            |                     | Replanted (non-virgin) orchard    |
|            |                     | soils to prevent orchard replant  |
|            |                     | disease                           |
|            |                     |                                   |
|            |                     | Medium to heavy soils             |
|            |                     |                                   |
|            |                     | Prohibition on use of             |
|            |                     | 1,3-dichloropropene products      |
|            |                     | because local township limits for |
|            |                     | this alternative have been        |
|            |                     | reached                           |
+------------+---------------------+-----------------------------------+
|            | \(e\) California    | Moderate to severe nematode       |
|            | almond growers      | infestation                       |
|            |                     |                                   |
|            |                     | Moderate to severe soilborne      |
|            |                     | disease infestation               |
|            |                     |                                   |
|            |                     | Replanted (non-virgin) orchard    |
|            |                     | soils to prevent orchard replant  |
|            |                     | disease                           |
|            |                     |                                   |
|            |                     | Medium to heavy soils             |
|            |                     |                                   |
|            |                     | Prohibition on use of             |
|            |                     | 1,3-dichloropropene products      |
|            |                     | because local township limits for |
|            |                     | this alternative have been        |
|            |                     | reached                           |
+------------+---------------------+-----------------------------------+
| O          | \(a\) California    | Moderate to severe soilborne      |
| rnamentals | growers             | disease infestation               |
|            |                     |                                   |
|            |                     | Moderate to severe nematode       |
|            |                     | infestation                       |
|            |                     |                                   |
|            |                     | Prohibition on use of             |
|            |                     | 1,3-dichloropropene products      |
|            |                     | because local township limits for |
|            |                     | this alternative have been        |
|            |                     | reached                           |
|            |                     |                                   |
|            |                     | A need for methyl bromide for     |
|            |                     | research purposes                 |
+------------+---------------------+-----------------------------------+
|            | \(b\) Florida       | Moderate to severe weed           |
|            | growers             | infestation                       |
|            |                     |                                   |
|            |                     | Moderate to severe soilborne      |
|            |                     | disease infestation               |
|            |                     |                                   |
|            |                     | Moderate to severe nematode       |
|            |                     | infestation                       |
|            |                     |                                   |
|            |                     | Restrictions on alternatives due  |
|            |                     | to karst topographical features   |
|            |                     | and soils not supporting seepage  |
|            |                     | irrigation                        |
|            |                     |                                   |
|            |                     | A need for methyl bromide for     |
|            |                     | research purposes                 |
+------------+---------------------+-----------------------------------+
| Peppers    | \(b\) Alabama,      | Moderate to severe yellow or      |
|            | Arkansas, Kentucky, | purple nutsedge infestation       |
|            | Louisiana,          | Moderate to severe nematode       |
|            | Mississippi, North  | infestation                       |
|            | Carolina, South     |                                   |
|            | Carolina,           | Moderate to severe pythium root,  |
|            | Tennessee, and      | collar, crown and root rots       |
|            | Virginia growers    |                                   |
|            |                     | A need for methyl bromide for     |
|            |                     | research purposes                 |
+------------+---------------------+-----------------------------------+
|            | \(c\) Florida       | Moderate to severe yellow or      |
|            | growers             | purple nutsedge infestation       |
|            |                     |                                   |
|            |                     | Moderate to severe soilborne      |
|            |                     | disease infestation               |
|            |                     |                                   |
|            |                     | Moderate to severe nematode       |
|            |                     | infestation                       |
|            |                     |                                   |
|            |                     | Restrictions on alternatives due  |
|            |                     | to karst topographical features   |
|            |                     | and soils not supporting seepage  |
|            |                     | irrigation                        |
|            |                     |                                   |
|            |                     | A need for methyl bromide for     |
|            |                     | research purposes                 |
+------------+---------------------+-----------------------------------+
|            | \(d\) Georgia       | Moderate to severe yellow or      |
|            | growers             | purple nutsedge infestation       |
|            |                     | Moderate to severe nematode       |
|            |                     | infestation, or moderate to       |
|            |                     | severe pythium root and collar    |
|            |                     | rots                              |
|            |                     |                                   |
|            |                     | Moderate to severe southern       |
|            |                     | blight infestation, crown or root |
|            |                     | rot                               |
|            |                     |                                   |
|            |                     | A need for methyl bromide for     |
|            |                     | research purposes                 |
+------------+---------------------+-----------------------------------+
|            | \(e\) Michigan      | Moderate to severe soilborne      |
|            | growers             | disease infestation               |
|            |                     |                                   |
|            |                     | A need for methyl bromide for     |
|            |                     | research purposes                 |
+------------+---------------------+-----------------------------------+
| Strawberry | \(a\) California    | Moderate to severe black root rot |
| Fruit      | growers             | or crown rot                      |
|            |                     |                                   |
|            |                     | Moderate to severe yellow or      |
|            |                     | purple nutsedge infestation       |
|            |                     |                                   |
|            |                     | Moderate to severe nematode       |
|            |                     | infestation                       |
|            |                     |                                   |
|            |                     | Prohibition on use of             |
|            |                     | 1,3-dichloropropene products      |
|            |                     | because local township limits for |
|            |                     | this alternative have been        |
|            |                     | reached                           |
|            |                     |                                   |
|            |                     | Time to transition to an          |
|            |                     | alternative                       |
|            |                     |                                   |
|            |                     | A need for methyl bromide for     |
|            |                     | research purposes                 |
+------------+---------------------+-----------------------------------+
|            | \(b\) Florida       | Moderate to severe yellow or      |
|            | growers             | purple nutsedge infestation       |
|            |                     |                                   |
|            |                     | Moderate to severe nematode       |
|            |                     | infestation                       |
|            |                     |                                   |
|            |                     | Moderate to severe soilborne      |
|            |                     | disease infestation               |
|            |                     |                                   |
|            |                     | Carolina geranium or cut-leaf     |
|            |                     | evening primrose infestation      |
|            |                     |                                   |
|            |                     | Restrictions on alternatives due  |
|            |                     | to karst topographical features   |
|            |                     | and soils not supporting seepage  |
|            |                     | irrigation                        |
|            |                     |                                   |
|            |                     | a need for methyl bromide for     |
|            |                     | research purposes                 |
+------------+---------------------+-----------------------------------+
|            | \(c\) Alabama,      | Moderate to severe yellow or      |
|            | Arkansas, Georgia,  | purple nutsedge infestation       |
|            | Illinois, Kentucky, |                                   |
|            | Louisiana,          | Moderate to severe nematode       |
|            | Maryland,           | infestation                       |
|            | Mississippi,        |                                   |
|            | Missouri, New       | Moderate to severe black root and |
|            | Jersey, North       | crown rot                         |
|            | Carolina, Ohio,     |                                   |
|            | South Carolina,     | A need for methyl bromide for     |
|            | Tennessee, and      | research purposes                 |
|            | Virginia growers    |                                   |
+------------+---------------------+-----------------------------------+
| Sweet      | \(a\) California    | Prohibition on use of             |
| Potato     | growers             | 1,3-dichloropropene products      |
| Slips      |                     | because local township limits for |
|            |                     | this alternative have been        |
|            |                     | reached                           |
+------------+---------------------+-----------------------------------+
| Tomatoes   | \(a\) Michigan      | Moderate to severe soilborne      |
|            | growers             | disease infestation               |
|            |                     |                                   |
|            |                     | Moderate to severe fungal         |
|            |                     | pathogen infestation              |
|            |                     |                                   |
|            |                     | A need for methyl bromide for     |
|            |                     | research purposes                 |
+------------+---------------------+-----------------------------------+
|            | \(c\) Alabama,      | Moderate to severe yellow or      |
|            | Arkansas, Florida,  | purple nutsedge infestation       |
|            | Georgia, Kentucky,  | Moderate to severe soilborne      |
|            | Louisiana,          | disease infestation               |
|            | Mississippi, North  |                                   |
|            | Carolina, South     | Moderate to severe nematodes      |
|            | Carolina,           |                                   |
|            | Tennessee, and      | Restrictions on alternatives due  |
|            | Virginia growers    | to karst topographical features,  |
|            |                     | and in Florida, soils not         |
|            |                     | supporting seepage irrigation     |
|            |                     |                                   |
|            |                     | A need for methyl bromide for     |
|            |                     | research purposes                 |
+------------+---------------------+-----------------------------------+
| PO         |                     |                                   |
| ST-HARVEST |                     |                                   |
| USES       |                     |                                   |
+------------+---------------------+-----------------------------------+
| Food       | \(a\) Rice millers  | Moderate to severe infestation of |
| Processing | in all locations in | beetles, weevils or moths         |
|            | the U.S. who are    |                                   |
|            | members of the USA  | Presence of sensitive electronic  |
|            | Rice Millers        | equipment subject to corrosion    |
|            | Association.        |                                   |
|            |                     | Time to transition to an          |
|            |                     | alternative                       |
+------------+---------------------+-----------------------------------+
|            | \(b\) Pet food      | Moderate to severe infestation or |
|            | manufacturing       | beetles, moths, or cockroaches    |
|            | facilities in the   |                                   |
|            | U.S. who are active | Presence of sensitive electronic  |
|            | members of the Pet  | equipment subject to corrosion    |
|            | Food Institute (For |                                   |
|            | this proposed rule, | Time to transition to an          |
|            | "pet food" refers   | alternatives                      |
|            | to domestic dog and |                                   |
|            | cat food).          |                                   |
+------------+---------------------+-----------------------------------+
|            | \(c\) Bakeries in   | Presence of sensitive electronic  |
|            | the U.S.            | equipment subject to corrosion    |
|            |                     |                                   |
|            |                     | Time to transition to an          |
|            |                     | alternative                       |
+------------+---------------------+-----------------------------------+
|            | \(d\) Members of    | Moderate to severe beetle         |
|            | the North American  | infestation                       |
|            | Millers'            |                                   |
|            | Association in the  | Presence of sensitive electronic  |
|            | U.S.                | equipment subject to corrosion    |
|            |                     |                                   |
|            |                     | Time to transition to an          |
|            |                     | alternative                       |
+------------+---------------------+-----------------------------------+
|            | \(e\) Members of    | Moderate to severe beetle or moth |
|            | the National Pest   | infestation                       |
|            | Management          |                                   |
|            | Association         | Presence of sensitive electronic  |
|            | treating cocoa      | equipment subject to corrosion    |
|            | beans in storage    |                                   |
|            | and associated      | Time to transition to an          |
|            | spaces and          | alternatives                      |
|            | equipment and       |                                   |
|            | processed food,     |                                   |
|            | cheese, dried milk, |                                   |
|            | herbs, spices and   |                                   |
|            | spaces and          |                                   |
|            | equipment in        |                                   |
|            | associated          |                                   |
|            | processing          |                                   |
|            | facilities.         |                                   |
+------------+---------------------+-----------------------------------+
| C          | \(a\) California    | Rapid fumigation is required to   |
| ommodities | entities storing    | meet a critical market window,    |
|            | walnuts, beans,     | such as during the holiday        |
|            | dried plums, figs,  | season, rapid fumigation is       |
|            | raisins, dates (in  | required when a buyer provides    |
|            | Riverside county    | short (2 working days or less)    |
|            | only), and          | notification for a purchase or    |
|            | pistachios in       | there is a short period after     |
|            | California          | harvest in which to fumigate and  |
|            |                     | there is limited silo             |
|            |                     | availability for using            |
|            |                     | alternatives                      |
|            |                     |                                   |
|            |                     | A need for methyl bromide for     |
|            |                     | research purposes                 |
+------------+---------------------+-----------------------------------+
| Dry Cured  | \(a\) Members of    | Red legged ham beetle infestation |
| Pork       | the National        |                                   |
| Products   | Country Ham         | Cheese/ham skipper infestation    |
|            | Association         |                                   |
|            |                     | Dermested beetle infestation      |
|            |                     |                                   |
|            |                     | Ham mite infestation              |
+------------+---------------------+-----------------------------------+
|            | \(b\) Members of    | Red legged ham beetle infestation |
|            | the American        |                                   |
|            | Association of Meat | Cheese/ham skipper infestation    |
|            | Processors          |                                   |
|            |                     | Dermested beetle infestation      |
|            |                     |                                   |
|            |                     | Ham mite infestation              |
+------------+---------------------+-----------------------------------+
|            | \(c\) Nahunta Pork  | Red legged ham beetle infestation |
|            | Center (North       |                                   |
|            | Carolina)           | Cheese/ham skipper infestation    |
|            |                     |                                   |
|            |                     | Dermested beetle infestation      |
|            |                     |                                   |
|            |                     | Ham mite infestation              |
+------------+---------------------+-----------------------------------+
|            | \(d\) Gwaltney and  | Red legged ham beetle infestation |
|            | Smithfield Inc.     |                                   |
|            |                     | Cheese/ham skipper infestation    |
|            |                     |                                   |
|            |                     | Dermested beetle infestation      |
|            |                     |                                   |
|            |                     | Ham mite infestation              |
+------------+---------------------+-----------------------------------+

One commenter requested that the language describing the National Pest
Management Association (NPMA) be changed to "Members of the National
Pest Management Association treating cocoa beans in storage and
associated spaces and equipment and processed food, cheese, dried milk,
herbs, spices and spaces and equipment in associated processing
facilities." EPA has incorporated this revised language describing the
NPMA because it clarifies that commodities will be fumigated as part of
space fumigations, as indicated in the application.

One commenter believes that post harvest application requests by NPMA,
NPCA, Pet Food Institute, and Rice Millers are for applications for
which methyl bromide is not necessary, and thus believes that they
should not receive CUE allocations. The commenter asserts that sulfuryl
fluoride is a feasible alternative for all post-harvest applications.
EPA received one comment stating that some post-harvest use limiting
critical conditions are no longer relevant and should be removed. The
commenter also notes that sufluryl fluoride has superseded phosphine and
heat as the preferred alternative in post-harvest use categories. The
conditions that the commenter requested be removed are:

-   Time to transition to an alternative

-   Older structures that cannot be properly sealed

-   Presence of sensitive electronic equipment subject to corrosion (by
    phosphine)

-   Rapid fumigation

EPA addresses the transition rate and overall feasibility of sulfuryl
fluoride for post-harvest sectors in Section V.D.6. of this preamble.

EPA agrees that the inability to properly seal older structures in
preparation for fumigation should not be the sole condition for granting
critical use exemption status to food processing facilities. The 2008
U.S. Critical Use Nomination (CUN) does not state that the inability to
seal older structures is a basis for methyl bromide need. This issue was
discussed only to highlight the difficulty in reducing methyl bromide
emissions from older structures. Therefore, EPA agrees and the limiting
critical condition for older structures has been removed from the rule
text.

As discussed in the 2008 CUN, research is still ongoing regarding the
efficacy of sulfuryl fluoride for the post-harvest critical uses listed
in Table I, and EPA must ensure that post-harvest sectors have
sufficient time to validate and adopt the new technology. Therefore, the
presence of sensitive electronic equipment remains a proper limiting
critical condition for critical use applications that would otherwise
use phosphine, which corrodes electronic equipment.

Regarding the rapid fumigation limiting critical condition for certain
post-harvest sectors, The United States Department of Agriculture (USDA)
Agriculture Research Service (ARS) is currently conducting research on
the efficacy and practicality of using alternative fumigants, including
sulfuryl fluoride, to control post-harvest pests of durable commodities
such as nuts and dried fruit. While acknowledging that sulfuryl fluoride
appears to have the potential to provide effective and rapid vacuum
fumigation of nuts and dried fruit, the Agency must ensure that the tree
nut and dried fruit industry has sufficient time to validate and adopt
the new technology. Therefore, rapid fumigation remains a valid limiting
critical condition for the sectors where it is listed in Table I.

EPA received one set of comments requesting that some of the pre-plant
limiting critical conditions be removed or modified in the final rule.
For example, the commenter states that with the availability of 1,3-D as
a nematicide, "nematode infestations," should not qualify as a limiting
critical condition. The 2008 U.S. critical use nomination explains that
methyl bromide is the only option to effectively control the target
pests, which includes nematodes, found in the Southeastern U.S. where
pest pressures commonly exist at moderate to severe levels. EPA responds
in more detail in the Response to Comment document for this action.

EPA is finalizing the proposed changes amending the table in 40 CFR part
82, subpart A, Appendix L, as reflected above. Specifically, EPA is
adding six references and deleting four references in column B, changing
the description of one critical use in column B, and removing one
limiting critical condition from five post-harvest sectors in column C,.
The changes are as follows: adding Mississippi to the approved locations
for cucurbit growers because that location was included in the approved
Southeast Cucurbit Consortium application for 2008; removing Florida
from the approved forest seedling locations because a 2008 application
for that location was not submitted to EPA; removing Maryland from the
approved strawberry nursery locations because a 2008 application for
that location was not submitted to EPA; removing California from the
approved locations for pepper growers because the United States
Government did not reflect this location in its 2008 Critical Use
Nomination; adding Mississippi to the approved locations for pepper
growers because that location was included in the approved Southeast
Pepper Consortium application for 2008; adding Mississippi and Missouri
to the approved locations for strawberry fruit growers because those
locations were included in the approved Southeastern Strawberry
Consortium application for 2008; adding California sweet potato slip
growers to reflect the authorization of that use in Decision XVIII/13;
adding Mississippi to the approved locations for tomato growers because
that location was included in the approved Southeastern Tomato
Consortium application for 2008; removing turfgrass because that use was
not agreed to by the Parties in Decision XVIII/13; adding Gwaltney and
Smithfield Inc. to the approved entities for dry cured pork products
because their application was approved for 2008; changing the
description of member of the National Pest Management Association (NPMA)
as requested by NPMA; and deleting the limiting critical condition
"older structures that can not be properly sealed to use an alternative
to methyl bromide" for post-harvest sectors.

The categories listed in Table I above have been designated critical
uses for 2008 in Decision XVIII/13 of the Parties. The amount of methyl
bromide approved for research purposes is included in the amount of
methyl bromide approved by the Parties for the commodities for which
"research purposes" is indicated as a limiting critical condition in the
table above. As explained in Section V.D.5. of this preamble, EPA is
allowing sale of 15,491 kg of methyl bromide from existing stocks for
research purposes, and adjusting new production accordingly. \[If memory
serves me, the Parties encouraged the U.S. to take research amounts from
existing stocks, but did not require it. I am concerned that if such
stocks are not available locally, that such research may not be possible
based on the wording here. I will reserve judgment until I read V.D.5.\]

In accordance with the recommendations in Table 9 of the TEAP's
September 2006 Final Report titled "Evaluations of 2006 Critical Use
Nominations for Methyl Bromide and Related Matters," available on the
docket for this rulemaking, EPA is allowing the following sectors to use
critical use methyl bromide for research purposes: commodities,
cucurbits (field), eggplant (field), nursery stock (fruit, nut, flower),
ornamentals, peppers (field), strawberry (field), strawberry runners,
and tomatoes (field). In their applications to EPA, these sectors
identified research programs that require the use of methyl bromide.

**[D. Critical Use Amounts]{.mark}**

Section V.C. of this preamble explains that Table C of the annex to
Decision XVIII/13 lists critical uses and amounts agreed to by the
Parties to the Montreal Protocol (Parties). When added together, the
critical use amounts authorized by the Parties for 2008 total 5,355,946
kilograms (kg), which is equivalent to 21.0% of the U.S. 1991 methyl
bromide consumption baseline of 25,528,270 kg as defined at 40 CFR 82.3.
However, the limit on authorized new production or import as set forth
in Table D of the annex to Decision XVIII/13 is 4,595,040 kg (18.0% of
baseline). The difference between allowable new production and import,
and the total critical use amount, will be made up from pre-phaseout
inventory that was produced before January 1, 2005. EPA further
discusses the breakout between new production or import and stocks in
sections V.D.1., V.D.2. and V.D.3. of this preamble.

[EPA is establishing the following reductions to the amount of newly
produced or imported methyl bromide authorized in Decision XVIII/13 to
satisfy critical uses:]{.mark}

[ (a) Reductions to account for the amount of available stocks;]{.mark}

[(b) Reductions to account for unused critical use methyl bromide at the
end of 2006;]{.mark}

[(c) Reductions to account for methyl bromide for research purposes that
should be taken from available stocks; and]{.mark}

[(d) Reductions to accommodate uptake of sulfuryl fluoride for
post-harvest cocoa bean fumigation in 2008.]{.mark}

[After accounting for the reductions listed above, EPA is allowing
limited amounts of new production and import of methyl bromide for
critical uses for 2008 up to the amount of 3,098,981 kg (12.1% of
baseline) as shown in Table II. EPA is also allowing sales of 1,724,550
kg (6.8% of baseline) of existing inventories for critical uses in 2008.
EPA explains each of the reductions listed above in the subsequent
sections of this preamble.]{.mark} \[Should consideration be given to
the amount that the Parties have required to be taken from stocks in
2009 by reducing the 1,724,550 by the 2009 requirement?\]

EPA received five comments that object to EPA's proposed reductions and
state that EPA should grant the full amount of new production allowed by
the Parties to the Montreal Protocol in Decision XVIII.

EPA received comments from Chemtura Corporation (Chemtura) that assert
that EPA \"arbitrarily\" reduces the amount of production authorized by
the Parties and \"never deigns to explain how amounts for production
previously determined to be critical are deemed no longer to be
critical."

When the United States prepares a critical use nomination, it is making
a determination as to the level of critical need. It is not making a
determination that a particular portion of that need should be met from
new production as compared to stocks. The Parties\' decisions contain a
determination as to the level of critical need as well as a maximum
amount of that total need that may be met from new production. The
Parties\' decisions do not specify a minimum amount that must be met
from new production. It is not accurate to state, as the commenter does,
that a particular production amount is itself \"critical.\" As explained
elsewhere in this preamble, EPA is adjusting the amount of new
production to take into account stocks that it has determined to be
available.

One commenter notes that the Copenhagen Agreement was signed by the U.S.
to phase out methyl bromide 14 years ago, and believes that this time
period has been adequate for all users of methyl bromide to switch to
alternative fumigation methods. The commenter believes that no methyl
bromide CUEs should be allocated, and that such allocations penalize
companies that already phased out methyl bromide. Another commenter
requests that EPA make a reduction in the 2008 CUE allocations of at
least 1,275,000 kg and by larger amounts in 2009 due to advancements in
using sulfuryl fluoride and iodomethane. The comments on EPA's proposed
reductions are addressed in the subsequent sections of this preamble and
in the Response to Comment document.

*1. Background of Critical Use Amounts*

The Framework Rule (69 FR 76982) and subsequent CUE rules each took note
of language regarding stocks of methyl bromide in relevant decisions of
the Parties. In developing this action, the Agency noted that paragraph
six of Decision XVIII/13 contains the following language: "that each
Party which has an agreed critical use renews its commitment to ensure
that the criteria in paragraph 1 of decision IX/6 are applied when
licensing, permitting or authorizing critical use of methyl bromide and
that such procedures take into account available stocks of banked or
recycled methyl bromide, in particular, the criterion laid down in
paragraph 1(b)(ii) of decision IX/6." Language calling on Parties to
address stocks also appears in prior Decisions related to the critical
use exemption.

In the Framework Rule, which established the architecture of the CUE
program and set out the exempted levels of critical use for 2005, EPA
interpreted paragraph 5 of Decision Ex. I/3, which is similar to
Decision XVIII/13(6), "as meaning that the U.S. should not authorize
critical use exemptions without including provisions addressing drawdown
from stocks for critical uses" (69 FR 76987). Consistent with that
interpretation, The Framework Rule established provisions governing the
sale of pre-phaseout inventories for critical uses, including the
concept of CSAs and a prohibition on the sale of pre-phaseout
inventories for critical uses in excess of the amount of CSAs held by
the seller. In addition, EPA noted that stocks were further taken into
account through the trading provisions that allow CUAs to be converted
into CSAs. In developing this final rule, EPA did not propose changes to
these basic CSA provisions.

In the August 25, 2004 Proposed Framework Rule (69 FR 52366), EPA
proposed to adjust the authorized level of new production and
consumption for critical uses by the amount of "available" stocks. The
methodology for determining the amount of "available" stocks considered
exports, methyl bromide for feedstock uses, and the need for a buffer in
case of catastrophic events. However, EPA did not adopt the proposed
methodology for determining available stocks in the final Framework
Rule. Instead, EPA issued CSAs in an amount equal to the difference
between the total authorized CUE amount and the amount of new production
or import authorized by the Parties (Total Authorized CUE Amount --
Authorized New Production and Import).

In the 2006 CUE Rule, published February 6, 2006 (71 FR 5997), EPA
applied the approach described in the Framework Rule by allocating as
CSAs the difference between the total authorized CUE amount and the
amount of new production and import authorized by the Parties (2.0% of
baseline), as well as the small supplemental allocation in Decision
XVII/9 (0.4% of baseline). EPA also issued CSAs allowing additional
amounts of existing stocks to be sold for critical uses (roughly 3.0% of
baseline). In the 2006 CUE Rule EPA issued a total of 1,136,008 CSAs,
equivalent to 5.0% of baseline. Similarly, in the 2007 CUE Rule, EPA
issued a number of CSAs that represented not only the difference between
the total authorized CUE amount and the amount of authorized new
production and import (6.2% of baseline), but also an additional amount
(1.3% of baseline) for a total of 1,915,600 CSAs (7.5% of baseline). By
allocating additional CSAs, EPA adjusted the portion of CUE methyl
bromide to come from new production and import as compared to the
proportion to come from stocks so that the total amount of methyl
bromide exempted for critical uses did not exceed the total amount
authorized by the Parties for that year.

EPA viewed the additional CSA amounts as an appropriate exercise of its
discretion. EPA reasoned that the Agency was not required to allocate
the full amount of authorized new production and consumption. The
Parties agreed to "permit" a particular level of production and
consumption; they did not---and could not---mandate that the U.S.
authorize this level of production and consumption domestically. Nor
does the CAA require EPA to exempt the full amount permitted by the
Parties. Section 604(d)(6) of the Clean Air Act (CAA) does not require
EPA to exempt any amount of production and consumption for critical
uses, but instead specifies that the Agency "may" exempt amounts for
production, importation, and consumption, thus providing EPA with
substantial discretion in creating critical use exemptions.

In the July 6, 2006 Proposed 2007 CUE Rule (71 FR 38325), EPA sought
comment on "whether, in the critical use exemption context, it would be
appropriate to adjust the level of new production and import with the
goal of maintaining a stockpile of some specified duration \[...\] and
on how many months of methyl bromide inventory would be appropriate, in
order to maintain non-disruptive management of this chemical in the
supply chain" (71 FR 38339). In the Final 2007 CUE Rule, EPA noted that
"the Parties have not taken a decision on an appropriate amount of
inventory for reserve. Nor has EPA reached any conclusion regarding what
amount might be appropriate. Given this uncertainty, and the continuing
decline in inventory levels, EPA is exercising caution in this year's
CSA allocation. EPA will consider various approaches to this issue in
the future based on the data received during this notice and comment
rulemaking process and other information obtained by the Agency" (71 FR
75399).

The benefits of pre-phaseout methyl bromide inventories for critical
uses were discussed at the 18^th^ and 19^th^ Meetings of the Parties
(MOP). The Parties did not take a decision at the 18^th^ or 19^th^ MOP
on whether it would be appropriate to allow some specific amount of
pre-phaseout stocks to remain in inventory, or what amount that might
be. However, at the 19^th^ MOP, the Parties did recognize that it is
appropriate to adjust new production and import levels to account for
the amount of "available stocks." In Table D of the Annex to Decision
XIX/9, the Parties authorized new production and consumption for
critical uses in the United States during 2009 of 3,961,974 kg, "minus
available stocks."

In the proposed rule, EPA noted that in another instance - namely the
Essential Use Exemption process for CFC inhalers - the Parties have
allowed companies to maintain working stocks up to one year's supply. As
explained in the "FDA determination letter" available on the public
docket for this rulemaking, FDA bases its determination of the amount of
CFC production that is necessary for medical devices "on an estimate of
the quantity of CFCs that would allow manufacturers to maintain as much
as a 12-month stockpile." However, neither FDA nor EPA maintains a CFC
reserve on behalf of any essential use manufacturer, or guarantees that
a certain amount of CFCs will always be held in inventory.

Similarly, in developing this action, EPA did not propose to maintain a
reserve of methyl bromide for critical uses, or to guarantee that a
certain amount of methyl bromide would always be held in inventory. EPA
did, however, propose to calculate the amount of existing methyl bromide
stocks that is available for critical uses in 2008, and to consider this
amount in the Agency's determination of how much sale of existing stocks
and how much production and importation to allow for critical uses in
2008. Section V.D.2. of the proposed rule described EPA's proposed
method to calculate the amount of stocks available for critical uses in
2008. Section V.D.3. of the proposed rule explained how EPA proposed to
adjust new production and import levels to account for the Agency's
calculation of the amount of available stocks.

In the proposed rule, EPA explained that through data collection and
experience, EPA has gained information about the CUE program that the
Agency did not have when the program began. For example, data on the
aggregate amount of methyl bromide held in inventory at the end of
calendar years 2003, 2004, 2005, and 2006 is now available in the public
docket for this rulemaking. The pre-phaseout inventory has gradually
declined to the point where, for the first time, EPA estimates that at
the start of next year (2008) inventory will represent less than a
one-year supply of critical use methyl bromide. EPA explained that the
proposed approach is intended as a clear and repeatable process for the
Agency to make responsible allocations that reflect a reasonable
estimate of the amount of inventory available in a future control period
based on data collected from earlier control periods.

*[2. Calculation of Available Stocks]{.mark}*

In developing this action, EPA proposed a formula to calculate the
amount of available stocks in 2008, which can be expressed as follows:
AS = ES -- D -- SCF, where AS = available stocks on January 1, 2008; ES
= existing pre-phaseout stocks of methyl bromide held in the United
States by producers, importers, and distributors on January 1, 2007; D =
estimated drawdown of existing stocks during calendar year 2007; and SCF
= a supply chain factor, the calculation of which was described in the
proposed rule and in the Technical Support Document available on the
public docket for this rulemaking. Using the methodology described in
the proposed rule, EPA proposed that ES = 7,671,091 kg; D = 3,224,351
kg; and SCF = 2,731,211 kg. Therefore, EPA proposed that 1,715,438 kg
(6.7% of baseline) of pre-phaseout methyl bromide stocks will be
available for critical uses in 2008. The Agency sought comments on its
proposed methodology. \[As the Parties have indicated that a minimum
fixed amount will be taken from new production/imports to supply the
2009 CUE allowance, should consideration be given to that amount by
reducing the available stocks calculation for 2008? If that amount is
not present in 2009, there is no basis to replace it and the CUE users
will be underserved!\]

[The Methyl Bromide Industry Panel (MBIP) correctly noticed in its
comments that EPA made a mathematical error in its calculation of
available stocks in the proposed rule.]{.mark} Even though EPA listed
existing stocks as 7,671,091 kg, which is the correct value, the Agency
used the value 7,671,000 kg in its calculation. As a result, EPA
proposed 1,715,438 kg of available stocks in 2008, when EPA intended to
proposed available stocks of 1,715,529 kg. In other words, EPA
underestimated available stocks by 91 kg. EPA has corrected its
calculations in this final rule.

One commenter believes the mechanisms for reporting stocks and usage are
imprecise, and therefore the Agency's calculations of stock levels are
likely inaccurate. The commenter did not explain why they believe the
mechanisms for reporting stocks and usage are imprecise.\[The deleted
text is suspect based on conversations with EPA and comments presented
during the Public Hearing.\]

EPA received six comments supporting the creation of a supply chain
factor (SCF), but these comments assert that the 15-week SCF suggested
for use in the event of a supply disruption is inadequate and recommend
a one-year supply instead. The commenters may be misled by the
assumption in EPA's proposed SCF analysis that it would take up to 15
weeks for adequate amounts of methyl bromide imports to reach the U.S.
if there is a domestic production failure. Because the Agency proposed
an SCF that would provide insurance against a production failure during
the peak production season (i.e. the beginning of the calendar year),
the Agency's proposed SCF is actually equivalent to about 51% of the
5,355,946 kg authorized for U.S. critical uses in 2008, or roughly a
six-month supply if demand were constant throughout the year. The
commenters provide a number of reasons why they recommend a one-year
supply buffer, and EPA responds to those comments below.

One commenter states that EPA's proposed supply chain factor is
inappropriate because it conflicts with the United States Government's
(USG) position at the 19^th^ Meeting of the Parties (MOP) to the
Montreal Protocol in Montreal, Canada, where the USG delegation
requested a six month reserve for critical uses. Another commenter
asserts that the Parties rejected the U.S. proposal to allow maintenance
of a half-year supply chain reserve at the 19^th^ Meeting of the
Parties. EPA disagrees with the first commenter\'s characterization of
the events at the September 2007 MOP. EPA disagrees with the second
commenter's assertion, because the Parties neither adopted nor rejected
the creation of such a reserve. EPA responds in more detail in the
Response to Comment document on the docket.

EPA received two comments that quote the technical limitations discussed
in EPA's analysis and state that these limitations render the final
calculation invalid. The Agency does not agree that any of the
acknowledged technical limitations individually, or taken together,
invalidate either the proposed supply chain factor or EPA's calculation
of available stocks. EPA's analysis should be considered within the
context of the United States' renewed commitment in paragraph six of
Dec. Ex.II/1, which was restated in Dec. XVIII/13, to ensure that the
criteria in Dec. IX/6(1), which is explained above, are applied when
permitting the use of methyl bromide. One of the primary ways that EPA
met this commitment in previous years was to consider the aggregate
quantity of existing stocks, and to reduce authorized new production
levels to encourage a more rapid draw down of existing stocks than
required by the Parties. EPA's consideration of stocks in determining
the appropriate production level is partially responsible for steadily
shrinking the aggregate stock quantity to less than half of its 2003
size, and the Agency projects that aggregate stocks will represent less
than a one year supply of critical use methyl bromide at the beginning
of 2008. With existing inventories declining significantly, EPA is
asking, at what point should the Agency stop facilitating a more rapid
inventory draw down?\[NOW!\] To answer this question, and to enhance the
transparency and uniformity of future CUE allocation rules, EPA proposed
to estimate the level of aggregate inventory that would be necessary to
respond to a scenario in which all methyl bromide production in the U.S.
is abruptly halted during peak production season. EPA chose this
scenario largely because methyl bromide, unlike most chemicals, is
produced at a sole facility in the U.S. Therefore, a scenario in which
this facility completely ceases production is of special concern. In
estimating the amount of methyl bromide that would be necessary in such
a scenario, EPA considered the effect of such a production failure
during the peak production season. EPA chose this conservative approach
partly in recognition that there could be other contingencies that might
affect critical users' ability to obtain methyl bromide in the event of
a full production failure.

Six commenters raise other examples of other events that could also
occur, and argue that the SCF should account for all of these
contingencies happening together. EPA notes that the probability that
all of these contingencies occurring together is lower than the
probability that any of them will occur individually. In addition, many
of the possible events described by the commenters would have an
uncertain effect not easily quantified. EPA's scenario is
straightforward and readily susceptible to quantification. In general,
EPA is relying on private entities to take prudent steps to protect
themselves against various contingencies. The inclusion of the supply
chain factor in the calculation of available stocks provides suppliers
an opportunity to maintain a buffer, but does not constitute a
guarantee.

Two commenters state that there is not a basis for the assumed risk of
catastrophic loss at the U.S. methyl bromide production plant, as no
such event has ever occurred at this location, and that the chance of
such an event happening right after the first of the year is even less
likely. EPA responded to the first part of the comment in the proposed
rule, by pointing out that the methyl bromide industry is unlike many
others, because there is only one active production facility in the
United States. EPA recognizes that a catastrophic loss is unlikely:
however, this does not obviate the need to plan for such a scenario.
While EPA expects private entities to take prudent steps to protect
themselves, EPA does not wish to render them incapable of maintaining a
reasonable supply buffer. In conducting its SCF analysis, the Agency
estimated that significant imports could arrive in up to 15 weeks.
Depending on what season the production failure occurred, the EPA
estimated that the lost production would be within the range of 11-51%
of the 2008 demand for 2008 critical use methyl bromide. EPA chose the
conservative end of the range, and proposed an SCF equivalent to 51% of
the 2008 need for critical use methyl bromide. EPA chose the
conservative end of the range, in part, so that its proposed SCF would
more likely account for a wider range of other supply disruption
scenarios that could occur.

Below, EPA reiterates the technical limitations of the proposed supply
chain factor analysis, and explains why each limitation does not render
the final estimate invalid, as a number of the commenters contend.

In its SCF analysis EPA stated that, "pre-2005 inventory is held by
multiple companies, and the sale of that inventory is governed by market
forces. Hence, in the event of a production failure, the stockpile could
be purchased by any user (i.e., critical use/non-critical use, QPS,
feedstock, or foreign users). Most likely, the stockpile would go to the
user willing to pay the highest price in time of short-term global
shortage. Second, there may also be existing contract agreements that
must be honored. As a result, there is no guarantee that the existing
pre-2005 inventory of methyl bromide will flow towards U.S. critical
uses in the case of a production failure." EPA believes that methyl
bromide for QPS, feedstock, and in Article 5 country uses would not have
to be supplied from pre-phaseout inventory after a supply disruption,
because, as explained in the proposed rule, existing regulations allow
manufacturers and distributors to manage inventories of methyl bromide
designated for those purposes (72 FR 48968).

There is precedent in the CUE program for allowing methyl bromide
distributors to respond to market forces. In the Proposed Framework
Rule, EPA explained that, "The issuance of critical stock allowances
(CSAs) does not obligate holders to make these quantities available to
critical uses if they choose for practical or business reasons not to
sell or distribute stocks to critical uses. However, EPA believes that
these firms will respond to market conditions" (69 FR 52376). Similarly,
EPA's consideration of a supply chain factor in its calculation of
available stocks does not obligate suppliers to sell their stocks to
critical users following a supply disruption. \[The example given is
unacceptable as Critical Users are generally subject to seasonal timings
that cannot be changed at will.\]EPA is unable to predict exactly how
stocks would be used after a disruption. All things considered, EPA does
not believe that the possibility that some inventory would be consumed
by non-critical users after a supply disruption invalidates the Agency's
SCF analysis.

The SCF analysis also stated that, "it is not clear that a contingency
plan exists amongst the various methyl bromide producers as to how to
respond to a major supply disruption. Thus, the reallocation of shipping
containers to import methyl bromide into the United States may not occur
smoothly over the first weeks or months while the various manufacturers,
shippers, and customers sort out their arrangements." Similarly, two
commenters express concern that importing the methyl bromide necessary
to meet U.S. demand would take far longer than 15 weeks due to the
inflexible methyl bromide shipping system. Chemtura Corporation
(Chemtura) states that "adjusting distribution patterns to accommodate a
sudden shift in worldwide demand and supply, as would occur with the
loss of U.S. production, would require an extensive, ad hoc redesign of
this distribution system with very little, if any, lead time."

The possibility that methyl bromide distributors have not conducted
emergency response planning does not invalidate EPA's SCF estimate.
Methyl bromide distribution is the responsibility of the methyl bromide
industry and not EPA. EPA's role is to allow producers and distributors
to satisfy critical needs for methyl bromide, not to guarantee that they
will do so. The Agency did consider physical shipping constraints that
dictate how rapidly methyl bromide distribution patterns can shift.
However, for the reasons expressed above, the Agency's analysis does not
assume that distributors will need long periods of time to redesign
their distribution patterns in order to respond. Furthermore, since each
shipping route takes weeks to complete, the Agency believes that
industry will have ample planning time to re-route containers as
necessary. EPA responds to comments about physical shipping constraints
below.\[This argument does not address the lack of sufficient numbers of
acceptable containers for the movement of methyl bromide
internationally. Additional time may, in fact, be required for
international shipping because of the lack of such ISO containers.\]

Finally, the Technical Support Document stated that, "characteristics
such as the purity of the pre-2005 inventory of methyl bromide could
affect users' ability to use this inventory to meet their needs for
methyl bromide; however, these characteristics are not known. For
example, some of the methyl bromide held in inventory may be intended
for pre-plant uses may be pre-mixed with chloropicrin in compressed gas
cylinders and therefore could not be used for post-harvest fumigation."
Similarly, EPA received two comments expressing concern about the
availability of stocks of methyl bromide free of chloropicrin for the
post-harvest sector. One commenter states that chloropicrin is premixed
in "virtually the entire" U.S. inventory of existing stocks. The other
commenter is especially worried about the possible need for emergency
fumigation treatments, which require pure methyl bromide, due to failed
attempts to move away from methyl bromide use.

EPA's current reporting requirements do not request information about
all of the characteristics, or composition, of the existing stockpile.
Just prior to publishing the proposed rule, the Agency received
anecdotal information suggesting that a large percentage of the existing
stockpile is mixed with chloropicrin, and therefore unsuitable for
post-harvest uses. EPA has also heard conflicting reports, stating that
a substantial portion of the existing stockpile is pure methyl bromide.
The Agency is currently considering options to obtain more information
about the existing stockpile, including but not limited to, sending a
Section 114 letter to pre-phaseout inventory holders. Because the CUA
amount in today's final rule is less than the production amount
authorized by the Parties, EPA may consider allowing the conversion of
some CSAs to CUAs in appropriate circumstances. The Agency also notes
that if pre-phaseout inventories contain very small amounts of pure
methyl bromide, then allowing for a larger supply buffer composed of
that inventory would not remedy the commenters' concerns.\[So, when will
the Emergency Rule be published to alleviate this concern?\]

One commenter believes that EPA needs to acknowledge methyl bromide's
role as a tool in responding to catastrophic events such as widespread
re-fumigation after a natural disaster. The commenter states that methyl
bromide has security as well as economic importance. EPA agrees with the
commenter and acknowledges methyl bromide's role in responding to the
situations described by the commenter. Methyl bromide's role in
responding to serious challenges such as those listed by the commenter
is one of the reasons EPA proposed to consider a supply chain factor in
its analysis of available stocks, and based its estimate of the SCF on
conservative assumptions.

Four commenters believe that the SCF should be a one-year supply because
of the global ramifications that the supply disruption from the U.S.'s
one plant would have. EPA agrees with the commenter that a severe
critical use methyl bromide shortage in the U.S. could have important
global ramifications. EPA considered international factors in its SCF
analysis. For example, after close scrutiny EPA estimated that foreign
production capacity is capable of meeting global demands for all methyl
bromide. While the commenters did not provide a specific basis for why a
one-year supply would be most appropriate, EPA responds to some of their
other concerns below and in the Response to Comments document on the
docket for this rulemaking.

Four of the commenters raise concerns about the ability of the Israeli
plant to divert methyl bromide to the U.S., especially in light of the
conflicts occurring in the Middle East. The commenters do not provide
specific information about the likelihood or consequences of the Israeli
supply disruption that they mention. As explained above, the SCF
estimate requires a determination about which contingencies to use as
the basis for the analysis. Contingencies that are too speculative or
whose effects cannot readily be quantified are not included in the
analysis. However, EPA adopted a conservative approach in recognition
that its analysis did not address all possible contingencies. One of the
commenters states that the U.S. would not be sacrificing environmental
goals by maintaining a one-year SCF because stockpiled methyl bromide
that is not in use can do no harm to the environment. EPA notes that
using existing methyl bromide can displace the need for new production
with corresponding environmental benefits.

MBIP and Chemtura both assert that importing the methyl bromide
necessary to meet U.S. demand would take longer than 15 weeks, as EPA
estimates. MBIP claims that the current capacity of specialized ISO
containers, which are used to ship methyl bromide overseas, is
inadequate to maintain global distribution following a supply
disruption. MBIP states, "Assuming round trip times of 45 days for
shipments from Israel to Europe and 90 days for all other trips, the
current worldwide fleet of ISO containers would need to immediately grow
by more than 35% to establish and maintain the global distribution
system for methyl bromide within the 15-week period estimated by EPA."
In their public comments Chemtura states, "To assist the Agency further
in understanding the logistical challenges raised by a shut-down of U.S.
production, Chemtura is submitting, as business-confidential exhibits,
two diagrams showing its estimates of the current global distribution
map, and how the distribution map would change if U.S. production were
suddenly disrupted."

EPA disagrees with the MBIP's claim that the current fleet of ISO
containers would be unable to maintain the global distribution system
for methyl bromide within the 15-week period estimated by the Agency.
EPA's supply chain factor estimate is based, in part, on a detailed
analysis of the capacity of the existing ISO container fleet, and other
shipping logistics.\[Did this include an analysis of the current surplus
in capacity or utilization ratio? For example, if existing containers
are in use 97% of the time, there is at best a 3% excess capacity
without regard to seasonal timing. Taking timing into account, there may
be no excess capacity with 97% utilization. Since most transport from
the production facility in the United States occurs in rail tank cars,
additional imports required as a result of an interruption at the U.S.
plant would have to utilize the excess container capacity of existing
ISO containers during the interruption.\] EPA can not reconcile the
differences between the Agency's estimate and MBIP's estimate, because
MBIP did not provide details about how it concluded that the existing
fleet of containers would be inadequate.

After close analysis, EPA found a number of points of disagreement with
the assumptions in Chemtura's confidential submission. In general, these
disagreements are related to concerns that Chemtura raised in its public
comments, which EPA addresses in this preamble. For confidentiality
reasons, the Agency is unable to elaborate on how Chemtura's submission
conflicts with EPA's analysis. The Agency concludes by stating that it
closely analyzed Chemtura's confidential submissions and did not find a
specific reason therein to revise its supply chain factor estimate.

MBIP raised several concerns about the amount of time it would take for
foreign methyl bromide producers -- specifically Israel Chemicals Ltd.
(ICL) -- to ramp-up production after a U.S. production failure. MBIP
believes that ramping-up foreign production would take longer than EPA
estimates because: methyl bromide manufacturers typically plan
production several months in advance; foreign producers may have to wait
for government approval before increasing their production; and an
immediate increase in methyl bromide production may not be possible due
to limited storage capacity.

EPA's supply chain factor analysis built in a certain amount of
time---starting from the time of disruption of the U.S. supply
chain---for foreign producers to make arrangements and adjustments to
their production schedules before it would need to ramping-up
production. The Agency notes that EPA considered the ability of foreign
producers to ramp-up production, including access to raw materials and
storage capacity. EPA also considered the fact that foreign producers
could increase production and exports to the United States without
approval from the Parties to the Montreal Protocol, as long as entities
holding CUA allowances are\[Isn't this the decision of the entity
granted the CUA production/import allowance and not the USG? Also, what
about the previously expended production lost during a catastrophic
event? How is it replaced?\] willing to expend their CUAs to import that
material. The commenter did not provide specific information about how
the concerns they raise should change EPA's supply chain factor
analysis, or whether there are steps that foreign producers could take
in advance as contingency measures that would alleviate these concerns.
EPA responds to these comments in more detail in the Response to Comment
document on the docket for this action.

MBIP noted that "significant regulatory challenges could hamper
companies' ability to obtain a sufficient supply of chloropicrin for
methyl bromide formulations" and that "if quantities of chloropicrin had
to be exported from the U.S. to Israel, several CWC \[Chemical Weapons
Convention\] regulatory requirements would be triggered." While it is
true that the export of chloropicrin to Israel would require special
export licenses and certificates---since Israel has not ratified the
CWC---it is not clear that quantities of chloropicrin would need to be
exported from the U.S. to Israel.\[This assumes that EPA and other USG
entities would allow the transport of pure methyl bromide from overseas
to a point where it could be mixed with chloropicrin. Has EPA confirmed
this with DOT?\]

According to preliminary Form R reports from the 2006 Toxic Release
Inventory (TRI), as well as past reports from 2005, the formulation of
methyl-bromide chloropicrin products is currently undertaken at five or
more facilities around the United States (EPA has placed information
collected from the TRI on the docket for this action). Thus, at least
for the products sold by these distributors to U.S. critical users,
chloropicrin would not be required to be exported to Israel for
formulation. The commenter did not provide specific information about
the likelihood that the CWC, or other regulatory measures, would impede
the supply of methyl bromide products to U.S. critical users, or whether
advance planning could help resolve potential difficulties.

EPA received one comment that notes that the distribution system for
methyl bromide in the U.S. is complex and expresses concern that imports
would not reach all repackaging locations in the same timeframe. The
commenter believes that 500,000 kilograms of methyl bromide must remain
in the system (a minimum of 3,231 metric tons of pre-phaseout stocks) to
keep the domestic distribution system functional. EPA believes that its
analysis accounts for the specific concern raised by the commenter. EPA
specifically accounted for this concern in the proposed SCF analysis.
The SCF would replace lost production for 15 weeks until imports
arrive[. Without a]{.mark} [domestic production failure, fresh methyl
bromide would be coming out of the U.S.]{.mark} [production facility
during week 16.]{.mark}\[Meaning is unclear. Supply disruption of what?
Materials to rebuild the plant?\] This methyl bromide would still have
to be transported to distributors and end-users. In the SCF scenario,
the new production in week 16 would be replaced by imported methyl
bromide, which EPA assumes would follow similar distribution patterns as
U.S. produced material. Therefore, contingent upon business decisions by
suppliers, the proposed SCF is large enough to provide uninterrupted
distribution in the analyzed scenario. \[Does EPA have data to show that
the material making up the SCF is distributed in a manner that is
roughly proportional to existing uses? IF stocks are concentrated in one
geographic region, their availability to be moved to other regions of
the country may be impeded if the supply is too close to the expected
demand during the period of disruption.\] [Furthermore, because shipping
containers may unload imports at multiple docks, as opposed to new
production which comes from one source, imports may actually arrive
faster in some locations than it would under normal]{.mark}
[circumstances.]{.mark}\[WRONG! Each container is delivered to a SINGLE
location. The vessel carrying containers may make multiple stops, but
each container onboard is delivered to a single port for transshipment
via land transport (i.e. truck or a combination of rail and truck). The
constraint on limited containers is the ability to get an emptied
container back to the filling point as expeditiously as possible. From
the information provided above, it is likely that containers could make
no better than one to two roundtrips during the time EPA has estimated,
and this would have to be with capacity in *excess* to that currently
being utilized in such ISO containers that are in existence at the
beginning of the disruption -- not the total number of ISO containers
that are in existence!\]

One commenter stated: "EPA does not consider regulatory obstacles that
may delay the availability of alternate supply\...In addition,
formulations of methyl bromide are regulated by EPA as pesticides under
FIFRA. As such, suppliers of these products must maintain registrations
with EPA. Under FIFRA, the source of methyl bromide used in the products
must be identified to EPA and detailed information about the
manufacturing process must be submitted. In addition, the labels for all
products must bear a special number that denotes the pesticide producing
establishment where the product is formulated. If production is shifted
to another location, the source information, manufacturing process data,
and labels for all affected products would have to be updated before the
products could be imported or distributed in the U.S. For example, if
the methyl bromide that is sourced from Israel is made using a different
manufacturing process than those on file with EPA, U.S. registrants may
need to notify EPA of the change in the formulation process that is on
file or even file an amendment to that process."

Pesticide registration information is highly confidential, but critical
sales data shows that imported methyl bromide is registered for some
critical uses in the U.S. EPA does not obligate producers to register
their products for all U.S. critical uses, but the Agency believes that
firms will respond to market conditions, and undertake appropriate
emergency response planning. A firm's decision about whether to register
their product for critical uses is similar to business planning
decisions under the established critical stock allowance policy noted
above, in which EPA lets firms respond \[spelling?\]to market
conditions, instead of requiring them to sell methyl bromide to critical
users (69 FR 52376). The Agency believes that the added transparency of
the SCF approach will help companies to respond to market conditions
more rapidly and appropriately.

EPA received two comments that object to the proposal to create an SCF
and believe the methyl bromide in question should be used to reduce or
eliminate the need for new production and import allocations for 2008.
The Agency explained the reasons for proposing an SCF in the proposed
rule. EPA responds to the commenters' specific concerns below and in the
Response to Comment document.

One of the commenters believes that the SCF will be equivalent to
existing stockpiles and will be easy to get and use by those with
restricted use pesticide licenses. The commenter states that stocks will
not be maintained for the purpose of the SCF---the stocks intended for
the SCF that remain unallocated for CUEs can be freely used by
non-critical users. The commenter is correct that this supply buffer
would be composed of methyl bromide produced before the January 1, 2005
phaseout. The commenter is also correct that non-critical users are not
barred from purchasing the pre-phaseout stocks of methyl bromide. In the
Final Framework Rule, EPA explained its rationale and authority for
allowing non-critical users to access stocks (69 FR 76988). EPA is not
revisiting that issue in this rulemaking.

The Agency does not believe that the fact that producers and
distributors may sell stocks to non-critical users invalidates the
proposed supply chain factor, or EPA's proposed estimation of the amount
of available stocks in 2008. The commenter is speculating about what
suppliers will do given the opportunity to maintain a buffer, which is
something that has not yet been tested. Information on stock drawdown
during 2008 will inform EPA's future CUE rulemakings.

While EPA did not propose to require that distributors keep the supply
chain factor amount as a supply buffer for critical users, Section
V.D.3. of the proposed rule lays out an approach in which the Agency
would stop drawing down stocks faster than the minimum agreed by the
Parties, if EPA determines that available stocks will be less than the
SCF amount. By considering a supply chain factor in its analysis of the
amount of stocks that are available for critical uses, EPA is giving
producers and distributors the opportunity to provide a reasonable
supply buffer to satisfy critical needs.

[Dow AgroSciences believes that the SCF should be based on the actual
2008 methyl bromide demand (4,816,514 kg) as determined by the U.S.
Government and as proposed in the rule) rather than the amount approved
by the Parties (5,355,946 kg). The commenter states that a SCF
calculated upon a methyl bromide volume that exceeds the critical need
for 2008 renders the SCF value and basis for the calculation
nonsensical. The commenter concludes that this simple recalculation
would reduce overall new MB production demand in 2008 by more than
250,000 kg.]{.mark}

[It appears that the commenter's figure for "actual methyl bromide
demand" is derived by subtracting the proposed 539,432 kg carry over
amount (72 FR 48969), from the critical use amount agreed to by the
Parties (5,355,946 kg). EPA reduces new production to account for carry
over critical use material in order to prevent companies from building
inventories of newly produced methyl bromide. EPA reduces new production
amounts to account for carry over, but in doing so the Agency is not
disputing the Parties' decision regarding the total critical need in the
United States for a given control period. EPA expects that critical
users will satisfy their critical needs by using the critical use methyl
bromide that was unused in previous control periods. Only reductions to
account for new information about the feasibility of alternatives are
actual reductions in the amount that EPA believes is necessary to
satisfy critical needs during the control period. Accordingly, because
EPA is reducing the total 2008 CUE by 17,690 kg to account for the
increased uptake for sulfuryl fluoride for cocoa bean fumigation, as
explained in Section V.D.6. of this preamble, the Agency has
re-calculated the SCF with a total 2008 demand for critical uses of
5,338,256 kg. This adjustment reduces the SCF by 9,021 kg.]{.mark}

One commenter believes that stockpiles or SCFs are counterproductive to
the phase out of methyl bromide and offer disincentives to companies to
invest in alternatives. EPA recognizes that a very large methyl bromide
inventory could have the counterproductive effects that the commenter
raises. In response to this concern, EPA has encouraged a faster draw
down of the pre-phaseout inventory than the minimum agreed by the
Parties. In the proposed rule, and above in this preamble, EPA explains
why it is important to allow producers and distributors to maintain a
reasonable supply buffer to satisfy critical needs. The Agency has also
explained the rigorous technical review process for critical uses both
domestically and internationally. Companies should be aware that as soon
as technically and economically feasible methyl bromide alternatives are
available for particular uses, critical use exemptions will be reduced
accordingly. Because the SCF is a percentage of the current year's
critical use amount, companies should also consider that, all things
being equal, the SCF will change in accordance with critical use
exemption levels. \[and will increase if CUE levels are forced to
increase?\]

One commenter objects to the SCF because the commenter believes that the
Parties and Congress did not intend for EPA to designate stocks as
"unavailable." EPA did not propose to designate any amount of stocks, or
any specific holdings, as "unavailable." EPA proposed to recognize the
amount of existing stocks that are available. As discussed above and in
the proposed rule, in paragraph 4 of Decision XVIII/13, and similar
decisions, the Parties indicated that each individual Party has
discretion to recognize the amount of existing stocks that are available
for critical uses. Most recently, Table D of the Annex to Decision XIX/9
explicitly indicates that the United States will reduce authorized new
production levels to account for the amount of available stocks. Thus,
EPA's proposed approach is consistent with the Parties' practice under
the Montreal Protocol. It is also an appropriate exercise of the
discretion granted by Congress under Section 604(d)(6) of the Clean Air
Act.

The commenter states that no chemical company keeps more than a two or
three month supply of a chemical, yet the SCF is nearly a four month
supply. The commenter provides no evidence for its assertion that no
chemical company keeps more than a two to three month supply of a
chemical. Furthermore, in many ways the methyl bromide industry is
unusual, because there is only one production facility in the United
States, which is also the lone production facility in the Western
Hemisphere. As explained above and in the proposed rule, EPA estimated
that the SCF for 2008 should be 2,731,211 kg, or roughly a six-month
supply of critical use methyl bromide if demand were constant throughout
the year.

The commenter contends that temporary adjustments at a manageable cost
can be made by methyl bromide users in the event of a supply disruption,
such as the use of alternatives or a shift in fumigation schedules. EPA
agrees that depending on when a supply disruption occurs, it is possible
that a *limited* number of entities might be able to delay scheduled
fumigations. It is also possible that some non-critical users might need
to access the pre-phaseout inventory for security or other emergency
purposes. We do not know whether these effects would occur or to what
extent they would offset each other. Such speculation does not change
the validity of EPA's estimate that 2,731,211 kg is a reasonable supply
buffer for 2008. EPA disagrees with the commenter's assertion that
critical users could readily switch to alternatives following a supply
disruption. By definition, and as confirmed by several rounds of expert
review, entities that qualify for critical use methyl bromide do not
have access to technically and economically feasible alternatives.

[In this final rule, EPA is adopting the proposed formula for
calculating the amount of stocks available for critical uses in 2008,
which can be expressed as follows: AS~2008~ = ES -- D -- SCF, where
AS~2008~ = available stocks on January 1, 2008; ES = existing
pre-phaseout stocks of methyl bromide held in the United States by
producers, importers, and distributors on January 1, 2007; D = estimated
drawdown of existing stocks during calendar year 2007; and SCF = a
supply chain factor, the calculation of which was described in the
proposed rule and in the Technical Support Document available on the
public docket for this rulemaking. Using the methodology described in
the proposed rule, correcting for mathematical errors explained above,
and reducing 2008 critical needs by 17,690 kg to account for the uptake
of sulfuryl fluoride explained below in Section V.D.6., EPA finds that
ES = 7,671,091 kg; D = 3,224,351 kg; and SCF = 2,722,190 kg. Therefore,
EPA calculates that 1,724,550 kg (6.8% of baseline) of pre-phaseout
methyl bromide stocks will be available for critical uses in
2008.]{.mark}

EPA believes 1,724,550 kg is a reasonable estimate of the amount of
stocks that should be considered available for critical uses in 2008,
recognizing that some amount of methyl bromide should remain in the
supply chain, especially given the U.S. role as one of the world's
largest suppliers to meet global methyl bromide needs. EPA also believes
the methodology used to make this estimate is consistent with the
relevant Decisions of the Parties, including Decision IX/6, and the
Clean Air Act. EPA has determined that the approach finalized in this
action is the most efficient and reasonable way to balance the goals of
satisfying critical needs for methyl bromide and also facilitating the
transition to ozone-safe alternatives. Finally, as discussed above and
in the Response to Comments document, EPA considered all of the comments
received and did not find a specific reason to change its proposed
calculation of the amount of available stocks.

*3. Adjusting New Production and Import Amounts to Account for Available
Stocks*

In developing this action, EPA proposed to refine its allocation
approach in order to account for the amount of stocks available for
critical uses in 2008, and each year thereafter as appropriate and
feasible. EPA proposed to allocate critical stock allowances (CSAs) in
2008 in an amount equal to the number of kilograms (kg) of stocks
available for critical uses in 2008, as estimated by EPA using the
formula described above. EPA also proposed how to adjust new production
and import to account for the amount of available stocks in future years
if the amount of available stocks is less than the amount of stocks the
Parties authorize for critical uses for the year in question. As
explained above, EPA calculates that there will be 1,724,550 kg of
available inventory in 2008. Therefore, EPA proposed to allow sale of
1,724,550 kg from existing stocks for critical uses in 2008 by
allocating an equivalent number of CSAs. As in past years, EPA proposed
to adjust the critical use allowance (CUA) amounts accordingly, so that
the total number of CUAs and CSAs is not greater than the total critical
use amount authorized by the Parties. In the proposed rule, EPA noted
that to account for carry-over amounts of methyl bromide, amounts for
research purposes, or for other appropriate reasons, including updated
information on alternatives, EPA may allocate a total number of CUAs and
CSAs that is less than the total critical use amount authorized by the
Parties for 2008. EPA sought comments on its proposed approach for
adjusting new production and import amounts to account for the amount of
stocks available for critical uses.

EPA received six comments expressing concern about the proposed level of
critical stock allowances of methyl bromide for 2008. The commenters
note that the proposed amount of methyl bromide to come from stocks is
beyond the level agreed by the Parties. The proposed rule, and Section
V.D.1. of this preamble explain that in previous years EPA has
determined that more critical use methyl bromide should come from stocks
than the minimum levels agreed by the Parties, and that EPA understands
those actions to be in compliance with the Montreal Protocol, and within
the Agency's authority established in Section 604(d)(6) of the Clean Air
Act.

One commenter believes that EPA's proposal to use stocks for critical
uses jeopardizes the U.S.'s ability to address a catastrophic supply
disruption. The proposed rule, and Section V.D.2. of this preamble
explain that by including a supply chain factor in its calculation of
available stocks, EPA is allowing for the maintenance of a supply buffer
that could help to satisfy critical needs in the event of an emergency,
such as a major supply disruption.

One commenter believes that a timely and accurate accounting system for
use during the control period for both new production and CSAs should be
developed and should be available to CUE holders. The commenter contends
that this accounting system would be important as stockpiles decrease
and would allow the Agency flexibility to shift from CSA's to new
production during the control period if necessary. Without this
flexibility, the commenter believes that the Agency should authorize the
total quantity approved for the 2008 Control Period as new production
with the understanding that the portion of material not used as a result
of the use of preexisting stocks during 2008 would be deducted from
future authorizations as the current practice for unused new production
authorized as CUAs. If EPA understands correctly, the commenter is
concerned that at some point existing stocks will not be able to satisfy
all of the CSAs issued by EPA for a given control period, and that if
this happens during a control period, EPA should convert CSAs to CUAs.
The Agency believes that the proposed approach for determining CUA and
CSA amounts, which accounts for the amount of available stocks, is a
major step towards decreasing the probability that EPA would issue more
CSAs than existing stocks are able to satisfy in a given control period.
Currently, EPA collects annual data about critical sales of new
production and stocks. EPA agrees with the commenter that collecting
this data more often, quarterly for example, could have certain benefits
related to monitoring stockpile information. As the commenter states,
more timely data could help EPA more rapidly determine if it would be
appropriate to allow the conversion of some CSAs to CUAs. However, by
increasing the repetition of reporting, the commenter's proposal would
impose substantial administrative burden upon the regulated community,
especially upon small distributors that currently submit annual methyl
bromide reports. Considering the approach that EPA is finalizing in this
rule, which should decrease the likelihood of impractically large CSA
allocations, the Agency does not believe the benefits of the commenter's
proposal would justify the additional costs it would impose.

In this rule, EPA is adopting the proposed approach for adjusting
allowable new production and import levels to account for the amount of
available stocks. As discussed above, this approach is consistent with
the relevant Decisions of the Parties, especially considering Table D of
the Annex to Decision XIX/9, which explicitly authorizes the United
States a certain amount of new production and import "minus available
stocks." Furthermore, after considering all of the comments received,
EPA believes this is the most reasonable, efficient and transparent way
for the Agency to continue to facilitate responsible management of the
pre-phaseout inventory. Therefore, with this action the Agency is
allowing 1,724,550 kg of stockpile consumption for critical uses in 2008
by issuing an equivalent number of CSAs, and adjusting the amount of
CUAs accordingly.

[To clarify, the critical use amounts authorized by the Parties in Dec.
XVIII/13 for 2008 total 5,355,946 kg. However, the maximum amount of
authorized new production or import as set forth in Table D of the annex
to Decision XVIII/13 is 4,595,040 kg. This means that while the Parties
require only 760,906 kg of stockpile consumption if the entire US
allotment is utilized, EPA is allowing 1,724,550 kg of stockpile
consumption for critical uses. Thus, to account for the amount of
available stocks, EPA is allowing 963,644 kg of extra stockpile
consumption for critical uses in 2008. As in past years, EPA proposed to
adjust the amount of CUAs accordingly, so that the sum of CUAs and CSAs
is not greater than the total amount authorized by the Parties.
Therefore, EPA is reducing the allowable amount of new production and
import by 963,644 kg. After accounting for the additional reductions
discussed below for unused critical use methyl bromide at the end of
2006, increased uptake of sulfuryl fluoride for post-harvest cocoa bean
fumigation in 2008, and reductions to encourage research amounts to be
supplied from existing stocks, EPA is allowing 3,098,981 kg of new
production and import for critical uses in 2008.]{.mark}

[In developing this action, EPA also proposed how the Agency would
adjust new production and import to account for the amount of available
stocks in future years, if the amount of available stocks is less than
the amount of stocks the Parties authorize for critical uses for the
year in question (72 FR 48969). EPA's proposed response to that possible
scenario is a logical extension of the approach taken in this action.
EPA did not receive any comments on how it proposed to account for
available stocks if the amount of available stocks is less than the
amount of stocks the Parties authorize for critical uses for the year in
question. If that scenario arises, EPA may adopt the approach it
described in the proposed rule, after a notice and comment rulemaking
process.]{.mark}

*[4. Treatment of Carry-Over Material]{.mark}*

As described in the December 23, 2004 Framework Rule (69 FR 76997), EPA
is not permitting entities to build stocks of methyl bromide produced or
imported after January 1, 2005 under the critical use exemption. Under
current regulations, quantities of methyl bromide produced, imported,
exported, or sold to end-users under the critical use exemption in a
calendar year must be reported to EPA the following year. These
reporting requirements appear at Sections 82.13(f)(3), 82.13(g)(4),
82.13(h)(1), 82.13(bb)(2 ), and 82.13(cc)(2) of 40 CFR. EPA uses the
reported information to calculate the amount of methyl bromide produced
or imported under the critical use exemption, but not exported or sold
to end-users in that year. An amount equivalent to this "carry over,"
whether pre-plant or post-harvest, is then deducted from the total level
of allowable new production and import in the year following the year of
the data report. For example, the amount of carry over from 2005, which
was reported in 2006, was deducted from the allowable amount of
production or import for critical uses in 2007. In developing this
action, EPA proposed to treat carry over the same way for 2008.

As discussed in Section V.D.2., carry over material is not included in
EPA's definition of existing stocks (ES) as it applies to the proposed
formula for determining the amount of available stocks (AS). EPA is not
including carry over amounts as part of ES, because doing so could lead
to a double-counting of carry over amounts, and thus a double reduction
of critical use allowances (CUAs).

In developing this action, EPA explained that in 2007, EPA received
reports about critical use methyl bromide production, imports, exports,
sales and/or inventory holdings in 2006 under the requirements at 40 CFR
82.13. The information reported to EPA indicated that 6,923,926 kg of
critical use methyl bromide was acquired through production or import in
2006, and 6,384,493 kg of critical use methyl bromide was exported or
sold to end-users in 2006. EPA proposed to calculate the amount of carry
over at the end of 2006 with the method used in column L of the U.S.
Accounting Framework for critical uses of methyl bromide. The Agency
calculated that the carry-over amount at the end of 2006 was 539,433 kg,
which was the difference between the reported amount of critical use
methyl bromide acquired (i.e. produced or imported) in 2006 and the
reported amount used (i.e. sold to end users in 2006) (6,923,926 kg --
6,384,493 kg = 539,433 kg). On March 16, 2007, the Agency officially
reported 539 metric tons of carry over from 2006 to the United Nations
Environment Programme (UNEP) Ozone Secretariat.

In the proposed rule, EPA brought attention to a petition submitted by
Chemtura Corporation (Chemtura) that proposes a number of changes to:
the Agency's established method for calculating carry over; the
distribution of subsequent CUA reductions; and the existing record
keeping and reporting requirements. The Agency made Chemtura's petition
available on the public docket, and specifically sought detailed
comments on Chemtura's proposals. EPA asked that comments suggesting
alternative methods for calculating the amount of carry over material at
the end of each year be detailed and comprehensive; address what changes
would be needed to the reporting requirements; and the degree of
administrative burden that alternative method might impose. The Agency
also sought comment on ways to improve the completeness of data
reporting by affected companies. EPA emphasized that the process for
calculating the amount of carry over CUE material each year relies on
sales to end user data reported to EPA by distributors and applicators.
The Agency specifically requested comment on whether requiring
producers, importers, and distributors to report the names of
distributors and third-party applicators to which they have sold
critical-use methyl bromide would result in more complete reporting, and
whether this would justify the additional burden of such requirements.

Chemtura's petition asserts that "EPA must adjust its methodology for
calculating carryover." EPA disagrees for two fundamental reasons: the
Agency's established methodology is a simple and accurate way to
calculate the carry over amount each year; and adjusting the established
method could create international confusion about U.S. reporting, which
could jeopardize international authorizations of new production to
satisfy the critical needs of U.S. agriculture.

The United States has important commitments to report information about
methyl bromide for critical uses. In December 2004 the Parties agreed to
Decision XVI/6, which adopted an accounting framework for critical uses
of methyl bromide. Each Party with critical needs submits an accounting
framework annually. The U.S. submitted its first accounting framework,
for 2005 critical uses, on May 19, 2006. The U.S. revised the accounting
framework agreed to by the Parties slightly, in part because information
requested about the amount of pre-phaseout inventories was being treated
as confidential.

For 2005 and 2006, EPA calculated the carry over amount using the method
described in the proposed rule, and reported the result internationally
in the U. S. Accounting Framework for critical uses of methyl bromide.
The Parties were subsequently informed of the U.S. carry over in the
progress report of the Technology and Economic Assessment Panel (TEAP),
which is published prior to each Open-Ended Working Group meeting, the
first international meeting of each round to discuss critical use
authorization levels. The 2006 carry over was reported on page 78 of the
2007 TEAP Progress Report. The Parties consider that information when
they make critical use authorizations, and expect EPA to reduce new
production, when appropriate, by the amount of carry over CUE material.
A *post-hoc* revision of the methodology for the U.S. Accounting
Framework could create international confusion, and as discussed more
below, there is not a compelling reason to change EPA's method at this
time. Therefore, EPA has determined that any revision of the previously
reported 2006 carry over amount must be based upon new data, not a new
method for manipulating old data.

Six commenters support Chemtura's request that EPA revise its carryover
calculation procedures to consider a broader range of information
sources when determining the carryover amount from a given control
period. The commenters suggest that EPA calculate the carryover as the
sum of all critical use methyl bromide that companies report as being
held in inventory. In its comments, Chemtura recognizes that this
approach would not fully address the problem of incomplete reporting,
and suggests that a conservative margin for error could be achieved by
calculating the average carryover for all reported sales and applying
the average to any remaining unreported volume. If EPA understands
correctly, the commenters are requesting an "inventory approach" to
calculate the carry over amount, in which EPA would calculate carry over
as the sum of critical use methyl bromide inventory reported in section
2.6 of the annual Sales of Critical Use Methyl Bromide to End Users
Reports ("sales reports"), a sample of which is posted on the docket for
this rulemaking. EPA understands that the commenters would prefer the
inventory method because they think it would result in a lower carry
over amount and because they believe it would be more accurate. However,
EPA does not believe the inventory method would be as accurate as the
established "sales method" that the Agency uses to report carry over
amounts internationally.

For 2006, the inventory method would rely on data reported in section
2.6 of the annual sales report forms. In collaboration with major methyl
bromide producers and distributors, the reporting forms were updated and
simplified in \[[month]{.mark}\] 2006, and posted on EPA's website in
\[[month]{.mark}\] 2006. EPA posted instructional materials online with
the updated forms, and held compliance assistance meetings to teach
stakeholders how to use the new forms, including a session at the Methyl
Bromide Alternatives Outreach conference in Orlando in November 2006. If
the sales reports are completely and accurately filled-out, section 2.6
is calculated with information from section 2.4A, 2.4B, 2.2, and 2.5.
For companies that hold critical use methyl bromide for other companies,
the information reported section 2.7 is an important cross-check of the
information reported in section 2.6. However, EPA reviewed the data in
sections 2.4 through 2.7 of the 2006 sales reports, and found several
instances of blank, incomplete or apparently misreported information in
those sections. EPA made efforts to contact distributors that filed
reports with significant inconsistencies, and many of the reports were
subsequently corrected. However, some of the data points remain blank or
questionable. On the other hand, there were far fewer instances of blank
or apparent misreporting in section 2.2 of the sales report, which lists
sales to end users by critical use sector. Most importantly, all
instances of blank or apparently misreported sales in section 2.2 were
corrected after EPA staff contacted the corresponding reporting
entities. Given EPA's concerns about the data in sections 2.4 through
2.7, and the Agency's reservations about changing the carry over
calculation method, EPA has decided not to adopt the commenters'
recommendations.

Six commenters assert that the critical use material calculated as carry
over for 2006 is actually unaccounted sales rather than inventory held
at the end of the year, and contend that EPA has evidence that this is
the case. As discussed more below, the commenters claim to have evidence
that 2006 sales remain unreported, but have been unable, to date, to
produce official sales reports to support their claims.

The Methyl Bromide Industry Panel (MBIP) states that EPA should have
been aware of the underreporting of critical use sales and that its data
set for calculating the carryover set is deficient. MBIP claims that
information it received in response to its FOIA request of \[date\]
clearly shows that some companies filed reports in 2005 and not in 2006.
Nonetheless, MBIP contends, EPA has mistakenly assumed that 100 percent
of the unreported sales of critical use methyl bromide are held in
inventory. In response, EPA points out that it made every reasonable
effort to contact entities that reported in 2005 and not 2006. Although
EPA contacted these entities, some of them still have not reported 2006
sales for critical uses. Whether every entity that sold critical use
methyl bromide in 2005 did so in 2006 remains an open question. EPA has
made it clear to MBIP that it would consider late submissions, within
reason, of official sales reports from 2006, but MBIP has been unable,
to date, to produce suitable evidence of the unreported sales that they
insist took place during 2006.

At the Public Hearing for this action, one commenter from Ameribrom Inc.
said that he learned that 80 percent of the 539 MT that EPA calculated
as carryover is actually methyl bromide that was sold to critical users
but not reported. He also said that many of the small distributors he
works with do not understand the reporting requirements, and some are
incapable of complying with them. The commenter did not provide
specific, verifiable information to support the claim that 80 percent of
the carry over is actually unreported sales. Therefore, EPA will not
change its proposed approach as a result of Ameribrom's claims. The
Agency is concerned with Ameribrom's claims about small distributors
that are not reporting. EPA continues to educate stakeholders about
critical use exemption reporting requirements through outreach programs.
For example, EPA posts instructional material on its website, holds
informational sessions about reporting at the annual Methyl Bromide
Alternatives Outreach Conference, and provides staff contacts to assist
with reporting requirements.

Most recently, EPA provided a letter template to members of MBIP,
including Ameribrom, that explains the importance of full reporting,
provides information about how to acquire official reporting forms, and
a contact person to answer questions. EPA encouraged MBIP's members to
customize the letter and send it to all of their customers; especially
entities that MBIP claims to know did not file a sales report.

MBIP states that an independent auditor found that approximately 20
methyl bromide suppliers failed to provide EPA with sales reports, which
accounted for approximately 80 percent of EPA's calculated carryover. As
EPA explains above, the Agency is unwilling to revise its methodology
for determining the previously calculated 2006 carry over amount, which
was reported internationally on March 16, 2007. As mentioned above, EPA
has taken a number of steps to work with MBIP, and other stakeholders,
to encourage full reporting. Such reporting, EPA believes, is in
everyone's interest. In addition, as explained below, EPA is taking
steps to collect the kind of information -- namely a list of all
distributors and applicators that buy critical use methyl bromide in
each control period---that would allow the Agency to verify MBIP's
claims. Regardless of these additional reporting requirements, the
importance of full reporting will not be diminished, and the Agency will
continue to work with industry in outreach and educational programs
toward that end. If MBIP can help to produce official, signed, reports
of 2006 critical sales the Agency remains willing to consider that
information, within reasonable time constraints, and if necessary and
appropriate, to proceed with a final rule during 2008 to revise the 2006
carry over amount.\[If MBIP is able to provide additional official,
signed reports for 2005 and 2006, will EPA revise its estimates that it
reports to UNEP, AND, recalculate the carryovers from 2005 and 2006? IF
it recalculates the 2005 and 2006 carryovers, will it propose to make
adjustments to the 2007 carryover to be deducted from 2009? IF NOT,
WHY?\]

Chemtura asserts that many of the companies that routinely filed
required reports are the entities most likely to be holding critical use
methyl bromide inventory -- manufacturers and distributors. MBIP states
that its audit revealed that non-reporting entities are mostly smaller
entities that would be unlikely to hold any inventory. Following MBIP's
logic, one would also expect the alleged non-reporting entities to sell
less critical use methyl bromide than the larger companies that
regularly file required reports. Therefore, MBIP's assertion does not
support their claim that critical sales in 2006 were significantly
greater than what was reported to EPA. Above in this preamble, the
Agency explains why it believes the sales method, which relies on
reported critical sales, is a more reliable source of data to calculate
the 2006 carry over than the inventory method that Chemtura supports,
which relies on reported inventory holdings.

Chemtura's petition asserts that EPA's contention that "carry over
increased while allocations and stocks have plummeted is not credible."
The commenters point to the reductions between the quantities of methyl
bromide in original CUE applications to the EPA allocations, as well as
declines in methyl bromide stocks, as proof that carryover is unlikely.
The annual carry over amount is determined by market forces and
decisions of individual producers and distributors. Whether or not EPA,
Chemtura, or anyone else thinks carry over is likely to increase or
decrease is irrelevant, because EPA must rely on official data to
ascertain the amount of carry over each year, and to credibly report
that amount internationally.

Six commenters request that EPA rigorously enforce compliance with
supplier reporting requirements. EPA is currently encouraging full
reporting through educational, outreach and compliance assistance
programs. An important part of these programs is to explain to the
regulated community that full reporting is in their best interest,
because non-reporting of sales will lead to reductions in allowable new
production in future years. In addition, as discussed below, EPA is
contemplating an additional reporting requirement that would provide the
Agency the information it would need to identify entities that should
have filed sales reports for a particular control period.

Chemtura and MBIP contend that the proposed rule's explanation of how
the carryover is calculated is the first such explanation given by EPA
in any CUE rule promulgated to date. MBIP states that this was their
first opportunity to comment on EPA's method of calculation. MBIP,
including Chemtura, participated in stakeholder meetings as early as
2003 to develop reporting requirements for critical use methyl bromide.
MBIP has been informed of, and had chance to comment on, every step of
the development of the reporting requirements for methyl bromide. Thus,
if MBIP thought that compliance with the sales to end-user reporting
requirement was likely to be an issue, MBIP could have submitted
comments to that effect when that requirement was proposed. MBIP and its
members may not have been informed through previous CUE rules exactly
how EPA intended to use the reported information to calculate the carry
over amount. However, the U.S. has been using the production minus sales
approach to report carryover through the U.S. Accounting Framework since
May 19, 2006 when EPA submitted the first U.S. Accounting Framework for
critical uses of methyl bromide to the Ozone Secretariat. The Agency
also posted the 2005 U.S. Accounting Framework on the public docket for
the 2007 CUE Rule on the date that the Proposed 2007 CUE Rule was
published (July 6, 2007), so MBIP had an opportunity to raise this
specific issue during the comment period for the Proposed 2007 Rule.

EPA received a comment from Chemtura expressing the view that EPA lacks
authority to reduce the 2008 CUE amount based on carryover from a
previous year. EPA's decision not to permit entities to build stocks of
methyl bromide produced or imported after January 1, 2005 under the
critical use exemption is contained in the Framework Rule. EPA did not
propose to revisit this fundamental decision in its August 27, 2007,
proposed rule. Rather, EPA sought comment on the method for calculating
the carryover and on ways to improve the completeness of data reporting.
EPA has substantial discretion under section 604(d)(6) of the Clean Air
Act regarding the authorization of production for critical uses. EPA's
decision to deduct carryover from previous years is reasonable because,
it is a practical step to comply with limits imposed by the Montreal
Protocol on the amount of critical use methyl bromide that the U.S. may
consume in each control period.\[However, in light of the uncertainty,
wouldn't it be wise to reconcile the uncertainties before again
deducting amounts that are questioned???\]

[In this final rule, EPA is not permitting entities to build stocks of
methyl bromide produced or imported after January 1, 2005 under the
critical use exemption. In the proposed rule, EPA explained that the
Agency received official sales reports under the requirements at 40
CFR]{.mark} [82.13 showing that 6,923,926 kg of critical use methyl
bromide was acquired through production or import in 2006. The proposed
rule stated that the information reported to EPA also indicated that
6,384,493 kg of critical use methyl bromide was sold to end-users in
2006. EPA calculated that the carry-over amount at the end of 2006 was
539,433 kg, which is the difference between the amount acquired and the
amount sold, and proposed to reduce 2008 CUA allocations accordingly.
However, EPA received 5 official 2006 sales reports after the submission
deadline (45 days after December 31, 2006). The late sales reports were
not counted in the proposed rule, or the 2006 U.S. Accounting Framework.
These late reports show that an additional **40,199 kg** **\[subject to
change if EPA receives other late reports\]** of critical use methyl
bromide was sold to end-users in 2006. As a result, EPA's official
records now show that 6,424,692 kg of methyl bromide was sold to end
users in 2006. Therefore, in accordance with EPA's proposed method for
calculating carry over amounts, EPA calculates that the 2006 carry over
amount was 499,234 kg of critical use methyl bromide. This amount was
calculated as follows: 6,923,926 kg -- 6,424,692 kg = 499,234 kg. To
account for carry over of inventory, EPA is reducing the level of new
production and import for critical uses by 499,234 kg.]{.mark}

[The Agency believes it is appropriate to re-calculate the 2006 carry
over amount to account for all data that has been fully and properly
submitted to EPA, and will make further recalculations if data become
available. Because the 2006 carry over amount affects 2008 production
levels, EPA believes it is not too late to adjust the carry over amount
to account for data that was not included in the 2006 U.S. Accounting
Framework, or the proposed rule. EPA intends to submit a revised 2006
U.S. Accounting Framework for critical uses of methyl bromide to the
Ozone Secretariat to account for the new data received by the Agency. In
addition, if EPA receives in the near future more late sales reports
that, if taken into account, would significantly decrease the calculated
2006 carry over amount, EPA may consider publishing a final rule during
2008 revising the carry over amount and granting a corresponding number
of additional CUAs, taking into account information for the 2005, 2006
and 2007 control periods.]{.mark}

In developing this action, EPA specifically requested comment on whether
requiring producers, importers, and distributors to report the names of
distributors and third-party applicators to which they have sold
critical-use methyl bromide would provide valuable information to EPA,
and help to encourage complete reporting of sales to end-user data. EPA
sought comment on whether this would justify the additional burden of
such requirements (72 FR 48970). EPA did not receive any comments
opposing this additional requirement.

Six commenters support a petition submitted by Chemtura to augment the
current accounting framework and recordkeeping process to prevent
underreporting of methyl bromide use. The commenters propose that EPA
modify its reporting system in a manner that would allow it to identify
non-reporting companies and the amount of critical use sales
attributable to each non-reporting company. EPA could achieve this, for
example, by requiring each entity in the supply chain -- from the
manufacturer to the company that sells to the end user -- to file a
report stating who that entity sold critical use methyl bromide to and
how much material it sold. EPA agrees with the commenters that this
information could assist outreach efforts, and increase incentives for
regulated entities to properly submit reports.

[EPA responds to these comments in Section V.E. of this preamble. For
the reasons explained in Section V.E., in this action, the Agency is
amending the reporting requirements at 40 CFR]{.mark} [82.13 to require
that all individuals or legal entities that sell critical use methyl
bromide must report annually the names of all non-end user entities
(i.e. producers, importers, distributors, third-party applicators) to
which they sell critical use methyl bromide.]{.mark} For the reasons
discussed in Section V.E., EPA is not requiring entities to report the
amount of critical use methyl bromide that they sell to each non-end
user entity. EPA believes these changes will provide important
information, and additional incentives for full reporting with the least
amount of burden for respondents.

One commenter states that EPA's reliance on full and accurate reporting
by the regulated community is unreasonable, because the existing
reporting system does not provide EPA with any way to verify whether all
entities that should file reports have done so. EPA currently relies
upon officially submitted data to calculate the carry over amount each
year. The commenter does not provide EPA sufficient data to verify their
assertions that the carryover consists in large part of unreported
sales. EPA believes reliance on signed reporting forms is preferable to
reliance on unverified assertions. The importance of the international
reporting commitments discussed above is an additional reason not to
recalculate the carryover on the basis of anything less than additional
signed sales reports. The Agency will continue educational and outreach
programs to encourage full and accurate reporting under 40 CFR 82.13. As
discussed above, EPA is actively pursuing additional reporting
requirements that may also help to encourage full reporting.

NRDC states that EPA should require the reporting of the names of
distributors and third-party applicators to which they have sold any
methyl bromide, including pre-2005 stocks, in order to get accurate data
to track amounts sold for all purposes (including non-critical
purposes). The commenter believes that the costs of such reporting would
be minimal and would be justified by the benefits of better tracking of
CAA and Protocol compliance. EPA responds to this comment in Section
V.E. of this preamble.

In previous CUE rules, EPA used the approach described in the Framework
Rule for implementing carry over reductions. After applying this
reduction to the total volumes of allowable new production or import,
EPA pro-rated CUA allocations to each company based on their 1991
baseline market share. In developing this action, EPA proposed to use
the same approach for issuing company-specific CUA amounts in 2008.

In the proposed rule, EPA explained that Chemtura's petition recommends
alternative methods for apportioning carry-over reductions among CUA
holders. EPA encouraged interested parties to consult Chemtura's
petition and sought comments on the recommendations in that petition, as
well as any additional suggestions regarding the apportionment of
carry-over among companies.

Chemtura's petition requests that EPA apportion carryover amounts to
hold accountable only the producers responsible for the carryover
originating in their own supply chain. The petition further states that
EPA's process for apportioning carry over reductions among producers is
arbitrary and capricious, unfair, and perpetuates poor stewardship. As
the commenter acknowledges, EPA does not currently collect information
that would allow the Agency to reduce CUAs on the basis of carry over
originating in each producer's supply chain. As discussed below in more
detail, EPA believes that acquiring credible data of this nature would
impose extra burden on the regulated community with no discernible
environmental benefit.\[Better data that accurately estimates carryover
and CUE use, rather than assuming it is carryover and decreasing future
control period allocations doesn't help "to satisfy critical needs for
methyl bromide"? I disagree with EPA on this point and request that they
rethink this sentence.\] EPA believes a better solution is to continue
to strengthen outreach and educational programs that facilitate full
reporting under existing requirements.

Chemtura notes that CUE reductions to account for carry over are
distributed among the four methyl bromide producers based on their 1991
consumption baselines. The commenter believes that an equal allocation
of the carry over would be fairer and that using the 1991 data is now
inconsistent with the available supply chain information and would
maximize future distortions in the critical use market. However,
Chemtura has no grievances with EPA's framework for distributing CUAs to
producers based on their 1991 market share, by which Chemtura receives
over 60 percent of the new production allowances each year. The Proposed
Framework Rule stated that, "Allocating CUAs based on each company's
1991 baseline allowances (on a pro-rata basis) is a better reflection of
market share than simply dividing the number of allowances by the total
number of entities, and would be less burdensome than conducting a
detailed historical market share analysis on a \[sic\] an annual basis.
Using the 1991 historic baseline method for distributing CUAs is
consistent with how EPA has allocated methyl bromide production and
consumption allowances for the past decade under the methyl bromide
phaseout" (69 FR 52376). EPA believes the arguments in the Proposed
Framework Rule still apply. Using the 1991 market shares, which have
become the company-specific baselines for CUA allocations, provides the
best available estimation of how much carry over is attributable to each
company's supply chain. A more detailed method of estimation would
involve additional burden for respondents.

Chemtura's petition recommends a "fault-based" system for allocating CUA
reductions to account for carry over amounts. Chemtura states that in
order to support the fault-based carry over allocation process, EPA
could modify the reporting requirements established at 40 CFR 82.13 to
require that importers, producers, distributors and third-party
applicators include information on the producer-level source of any
critical use methyl bromide they acquired during the year. In its
comments, Chemtura asserts that, "Identifying the producer of origin for
any given sale or distributor should be a simple task, as each of the
four producers supplies downstream customers with methyl bromide
products under different pesticide registrations, labels, and product
names. Thus, regardless of how many intermediary distributors a methyl
bromide product may have passed through before reaching the end user,
that entity can identify the producer by a review of the label or sales
invoice."

Whether or not producer of origin reporting would be a "simple task," it
would add to the regulatory burden currently borne by entities in the
distribution chain. Preliminary estimates, using previous ICR analyses
as a guideline, suggest that the burden imposed by producer of origin
reporting could require 150 respondent hours per year, depending on how
much EPA follow-up is necessary to perform standard data quality
assurance procedures. EPA does not believe the "fault-based" system, or
the extra reporting burden it requires, would have any discernible
environmental benefit, or help to satisfy critical needs for methyl
bromide. Therefore, while the Agency may continue to analyze Chemtura's
proposed reporting additions as part of its ICR renewal processes during
2008, in this final rule the Agency is not implementing Chemtura's
"fault-based" system or the additional reporting that it would require.

Chemtura's petition asserts that, "The opt-out system proposed \[in the
petition\] provides an appropriate method for apportioning carryover
penalties." Chemtura's proposed "opt-out" system would allow producers
to voluntarily submit supply chain data in exchange for EPA's removal of
the individual producer from the "default penalty pool." Chemtura
provided a confidential exhibit as an example of the documentation that
a producer would voluntarily submit to EPA under the opt-out system, in
order to "demonstrate the substantive compliance of its supply chain
with all reporting and sales to end-user requirements." []{.mark}

Verifying the confidential information that Chemtura provided as an
example of "opt-out" submissions would be costly for the distributors
that EPA would have to contact, and would not further any of EPA's
priorities under the CUE program. As discussed above, EPA relies on
officially submitted data, on OMB approved forms, for accuracy and
reliability. EPA followed the appropriate procedures under the Paperwork
Reduction Act (PRA) for the current reporting requirements. The Agency
is concerned that in practice the proposed "opt-out" system would not be
as voluntary as Chemtura claims. Allowing one entity to submit voluntary
reports as the basis for a more favorable allocation could be tantamount
to imposing a reporting requirement on all such entities, because the
practical effect of that policy would be that other companies would have
to submit similar reports in order to avoid being adversely affected.
EPA estimates the burden hours associated with the submission and
consideration of these voluntary reports could annually impose 60 burden
hours for respondents. The Agency believes this additional burden would
be unjustified.

In its comments on the proposed rule Chemtura asserts that Ameribrom has
acknowledged responsibility for the majority of the 2008 carryover.
Chemtura contends that at the Public Hearing on this action, Ameribrom
admitted that approximately 80 percent of the 2006 carryover originated
within Ameribrom's supply chain in the form of unreported sales.
Chemtura states that Ameribrom also suggested that it had failed to
reach users with portions of its 2006 allocation, citing an inability to
move product through its supply chain during 2006. Chemtura also states
that Ameribrom has suggested that distributors in its supply chain are
"probably never going to be able to comply" with EPA's reporting
requirements. A careful reading of the transcript from the public
hearing does not confirm Chemtura's assertion that Ameribrom claimed
that 80 percent of the 2006 carry over originated from Ameribrom's
supply chain. EPA explains this in more detail in the Response to
Comment document on the docket for this rulemaking. EPA has not received
data to substantiate the claim that 80 percent of the 539 tons
constitutes unreported sales.

Chemtura's petition asserts that, "EPA has received ample notice of the
flaws in the framework." In its comments, Chemtura states that EPA has
received multiple past comments regarding the issues surrounding
carryover calculation and should therefore be equipped to address the
reporting and penalty apportioning issues in the final 2008 rule. For
the reasons discussed above, EPA does not agree with the commenter's
assertion that there are flaws in the Agency's framework for calculating
carry over, or implementing carry over reductions. In addition, EPA
received Chemtura's petition too late to evaluate Chemtura's proposals
prior to issuance of the proposed rule.

Chemtura further comments that any material that stays in the
distribution system past the end of a control period should be
considered part of the supply chain factor rather than carry over, and
that no carry over should be subtracted from CUEs in 2008 and beyond.
The Framework Rule established EPA's policy of not allowing companies to
build inventories of critical use methyl bromide. In this final rule,
EPA is applying carry over reductions for 2008, and has explained why it
believes its method for calculating carry over is the appropriate
approach. If EPA understands correctly, the commenter is suggesting that
EPA expand the supply chain factor to include carry over amounts.
However, the proposed supply chain factor is based upon an analysis of
the amount of stocks necessary to respond to particular supply
disruption scenarios. The Agency does not understand why the amount of
carry over should affect that analysis. EPA will continue to consider
the level of available stocks, and may consider adjusting carry over
policies, through a notice and comment rulemaking process, if available
stocks become very scarce.\[Will this then constitute an "Emergency"?\]
However, in this action, considering the amount of available stocks, the
Agency believes it is best to maintain the existing framework for
responding to carry over.

[In this action, EPA is reducing the total level of new production and
import for critical uses by 499,234 kg to reflect the total level of
carry-over material available at the end of 2006. To implement the
reduction, the Agency is reducing the total number of CUAs issued for
2008 by 499,234. EPA is not adopting any of the recommendations in
Chemtura's petition that would change the way EPA apportions carry over
reductions to CUA recipients. As explained below in Section V.E. of this
preamble, in this action EPA is amending 40 CFR]{.mark} [82.13 to add
reporting requirements that the Agency believes will enhance its
continuing efforts to encourage full and accurate reporting, which is
used to calculate the carry over amount. However, EPA's preliminary
analysis finds that adopting Chemtura's other proposals would impose
extra burden on the regulated community without furthering any of EPA's
goals under Section 604(d)(6) of the Clean Air Act.]{.mark}

*5. Amounts for Research Purposes*

Decision XVII/9(7) "request\[ed\] Parties to endeavor to use stocks,
[where available]{.mark},\[Doesn't this infer a geographic distribution?
Has EPA analyzed the geographic distribution of stocks; either pre-2005
or CUE?\] to meet any demand for methyl bromide for the purposes of
research and development." Consistent with that Decision, in the 2007
CUE Rule, EPA reduced the amount of new production and import by 21,702
kilograms, which was the amount needed for research. Consistent with
Decision XVII/9, EPA continued to encourage methyl bromide suppliers to
sell inventory to researchers and encouraged researchers to purchase
inventory.

Decision XVIII/15(1) authorizes "the production and consumption of
\[methyl bromide\] necessary to satisfy laboratory and analytical
critical uses." Paragraph 2 of that decision states that methyl bromide
produced under the exemption for laboratory and analytical uses may be
used as a reference or standard; in laboratory toxicology studies; to
compare the efficacy of methyl bromide and its alternatives inside a
laboratory; and as a laboratory agent which is destroyed in a chemical
reaction in the manner of feedstock. In a separate notice-and-comment
rulemaking titled the "Global Essential Laboratory and Analytical Use
Exemption," EPA is implementing the exemption authorized in Decision
XVIII/15 (72 FR 52332). More information about that rulemaking process
is available on the docket for that rule (EPA-HQ-OAR-2007-0384).

In developing this action, EPA stated that there continues to be a need
for methyl bromide for research purposes that do not meet the criteria
for laboratory and analytical uses, as defined in Decision XVIII/15. A
common example is an outdoor field experiment that requires methyl
bromide as a standard control treatment with which to compare the trial
alternatives' results. In the proposed rule, EPA listed the critical use
sectors that were approved by the Parties to use methyl bromide for
research purposes in 2008 in Section V.C. and with the phrase "research
purposes" listed in their limiting critical conditions in Table I of
this preamble.

In developing this action, EPA proposed to allow sale of 15,491 kg of
existing stocks for research purposes in 2008 to account for the amount
authorized for those purposes. EPA proposed to allow methyl bromide sale
from stocks for exempted research purposes by expending CSAs. An
explanation of what amounts of methyl bromide and of what sectors
qualify for research purposes can be found in Section V.C. of this
preamble. The Agency proposed to continue to encourage methyl bromide
suppliers to sell inventory to researchers and to encourage researchers
to purchase inventory for research purposes. EPA sought comment on its
proposal to issue CSAs for sale of methyl bromide stocks for exempted
research purposes.

EPA received one comment objecting to its proposal to issue CSAs for
sale of pre-phaseout stocks for exempted research purposes. The
commenter believes that existing stocks of pre-2005 inventory are too
low to warrant further drawdown for research purposes and that new
production should be increased by 15,491 kilograms to account for
research needs. The Agency disagrees, and proposed a detailed analysis
of the amount of available stocks, which found more than 1,700,000 kg of
stocks available for critical uses. [Therefore, in accordance with Dec.
XVII/9(7), EPA is reducing new production by 15,491 kg, and encouraging
researchers to procure methyl bromide from available
stocks.]{.mark}\[Will EPA consider an Emergency Exemption for research
purposes if or when stocks are insufficient to supply research needs?\]

*6. Methyl Bromide Alternatives*

In the 2006 CUE Rule (71 FR 5985) EPA allocated less methyl bromide for
critical uses than was authorized by the Parties in order to account for
the recent Federal registration of sulfuryl fluoride. The allocation
reductions in that rule reflected transition rates that were included
for the first time in the 2007 U.S. Critical Use Nomination (CUN). In
the 2007 CUE Rule, EPA explained why a similar reduction was made in
that rule: "The report of the Methyl Bromide Technical Options Committee
(MBTOC) indicated that the MBTOC did not make any reductions in these
\[post-harvest\] use categories for the uptake of sulfuryl fluoride in
2007 because the United States Government indicated that it would do so
in its domestic allocation procedures. Therefore, EPA is reducing the
total volume of critical use methyl bromide by 53,703 kilograms to
reflect the continuing transition to sulfuryl fluoride" (75 FR 75390).

In developing this action, EPA referenced preliminary results of a study
by Dr. Brian D. Adam of Oklahoma State University, which the Agency is
making available on the public docket for this rulemaking. The proposed
rule stated that the results of Dr. Adam's study indicate that the cost
of post-harvest cocoa fumigation with sulfuryl fluoride is not
substantially greater than the cost of using methyl bromide for that
fumigation. The proposed rule explained that in response to the study
results, the National Pest Management Association (NPMA) decided to
withdraw its nomination request for critical use methyl bromide for
cocoa for calendar year 2009 and not to seek critical use methyl bromide
for cocoa at all in calendar year 2010. EPA reiterated NPMA's stated
need for some critical use methyl bromide for cocoa in 2008 as the
sector transitions to sulfuryl fluoride, and explained the situation
further. EPA sought comment on how much of the 50,188 kg of critical use
methyl bromide approved by the Parties for cocoa for 2008 should be
allowed by the Agency. EPA asked that comments on this topic recommend
specific amounts of critical use methyl bromide for cocoa in 2008, and
provide detailed justifications for their recommendations.

EPA received a comment from NPMA that recognizes that an Oklahoma State
University study has shown that the cost of using sulfuryl fluoride to
treat post-harvest cocoa is not substantially greater than the cost of
using methyl bromide. However, NPMA's comment states that some
transition time is needed for the smaller companies in the industry to
transition to sulfuryl fluoride. This transition includes the completion
of a manufacturer's stewardship program as well as an education process
with the customers to receive their consent to a different treatment.
Additionally, while most states in which cocoa is processed have a
special 24(C) label to allow for higher Concentration and Time (CT)
dosage allocations for use of sulfuryl fluoride on cocoa, New York has
still not approved this label. Therefore, the commenter requests that at
least 75 percent of the 53.188 metric tones of critical use methyl
bromide approved by the Parties be allocated for 2008. The commenter
states that NPMA's application for 2009 has been withdrawn, as the
transition to sulfuryl fluoride should be complete by that time.

In their 2008 CUE application, NPMA requested 79,950 kg for 2008
critical uses. In developing the critical use nomination, the U.S.
government (USG) reduced NPMA's original request by 3,051 kg to account
for growth, because EPA's framework does not allow critical users to
increase their critical need based on expansion of their operations (FR
69 76996). USG also reduced NPMA's original request by 12,980 kg to
account for a reduction in the use rate of methyl bromide from 24
kg/1,000 m^3^ to 20 kg/ 1,000 m^3^. USG made a further reduction of
10,753 kg to NPMA's request to account for a transition rate of 16.8%
per year to sulfuryl fluoride. In light of new information about the
feasibility of sulfuryl fluoride for post-harvest cocoa fumigation, in
this action EPA is increasing these reductions to account for a greater
transition rate to sulfuryl fluoride.

As noted previously, in its comments, NPMA requested that EPA approve 75
percent (or 39,891 kg) of the 53,188 kg that the Parties authorized for
2008 cocoa fumigation in Dec. XVIII/13. NPMA states that some of its
members need more time to complete the required manufacturer's
stewardship program, time for customer education for consent to
non-methyl bromide treatments, and time for resolving regulatory issues
such as the need for 24(C) special local needs (SLN) labels for sulfuryl
fluoride to allow for a more effective concentration and time (CT)
dosage rate in New York State, which includes the third-largest cocoa
port.

However, NPMA does not provide specific calculations or estimates to
support its request for 75 percent of the amount agreed by the
Parties\[or was it 75% of their original request?\]. In its comments,
and in previous communications with the Agency, NPMA suggested that the
two largest cocoa fumigation companies, which treat the majority of
post-harvest cocoa in the U.S., are fully ready to transition to
sulfuryl fluoride. EPA acknowledges that the transition to sulfuryl
fluoride is impeded in New York State by the SLN label issue that NPMA
raises in its comments. However, after considering the latest available
information, EPA can not support NPMA's request for 75 percent of the
53,188 kg agreed to by the Parties.

[After these considerations, and noting NPMA's proactive steps
transitioning to alternatives, EPA is approving 35,498 kg, or roughly 67
percent of the 53,118 kg of critical use methyl bromide agreed to by the
Parties for cocoa for 2008. Therefore, EPA is reducing the total
critical use amount for 2008 by 17,690 kg, which is the difference
between the Parties' authorization for cocoa fumigation (53,188 kg) and
the amount that EPA is approving (35,498 kg).]{.mark}\[Based on what?
Give me the logic or go back to 100%\]

Besides the issues regarding post-harvest cocoa fumigation discussed
above, EPA did not propose to make any other reductions in post-harvest
critical use allowances to account for the uptake of sulfuryl fluoride,
or any other post-harvest alternatives. The Agency explained that the
2008 Critical Use Nomination (CUN) the Agency applied transition rates
for all critical use sectors. The MBTOC report of September 2006
included reductions in its recommendations for critical use categories
based on the transition rates in the 2008 CUN. MBTOC's recommendations
were then considered in the Parties' 2008 authorization amounts, as
listed in Decision XVIII/13. Therefore, EPA explained that transition
rates, which account for the uptake of alternatives, have already been
applied for authorized 2008 critical use amounts. Furthermore, the
Agency stated that the 2009 CUN, which represents the most recent
analysis and the best available data for methyl bromide alternatives,
does not conclude that transition rates should be increased for 2008. In
developing this action, EPA sought comment on its proposal not to make
further reductions in 2008 to account for the uptake of methyl bromide
alternatives.

One commenter states that post harvest application requests by NPMA,
NPCA, Pet Food Institute, and Rice Millers are for applications for
which methyl bromide is not necessary, and thus believes that they
should not receive CUE allocations. One commenter expresses support for
EPA's proposal not to make further reductions in 2008 to account for the
uptake of methyl bromide alternatives. The commenter notes that some
fumigation companies need more time to transition to sulfuryl fluoride,
including the purchase of new equipment and training in its use.
Specifically, the commenter believes that allowing CUEs for cocoa in
2008 will enable a smoother transition to sulfuryl fluoride and would
help to guarantee methyl bromide availability to guard against
unforeseen problems with the transition.

EPA received two comments that state that sulfuryl fluoride is a viable
and economic fumigant alternative for all post-harvest structural
fumigations. These commenters believe that methyl bromide allocations
for these applications should therefore be significantly reduced or
eliminated. EPA received one comment that states that nearly 50 percent
of the 220 flour mills in the U.S. can be\[have been\] fumigated with
sulfuryl fluoride. The commenter believes that the 15-20 percent
transition of new technology stated by EPA may apply to farm
applications but believes that it is too low for structural
applications. Additionally, the commenter notes that sulfuryl fluoride
has proved successful even after multiple applications with no return to
methyl bromide, and that fumigation failures can happen with all
materials, including methyl bromide. One commenter requests that EPA
reduce the proposed CUE amount for all structural uses by at least half
for 2008 and eliminated exemptions for such uses in 2009. The commenter
notes that CUEs for post-harvest cocoa uses in particular should be
reduced.

The Agency believes that there are still some efficacy and validation
issues that need to be adequately addressed before sulfuryl fluoride can
be fully adopted by the food processing industry. Sulfuryl fluoride
fumigation integrates temperature (requires less product as temperature
increases), dosages (choice of only post-embryonic stages or all life
stages), and exposure time. Sulfuryl fluoride efficacy on insect eggs
requires higher concentrations, except at optimal temperatures. Its use
also requires extensive training of applicators to proficiently use the
computerized fumigation guide. Although many flour and rice mills have
indeed fumigated their facilities with sulfuryl fluoride in 2006, the
food processing industry is still learning how to incorporate sulfuryl
fluoride fumigation into its pest management strategies. Therefore, with
this action, the post-harvest applications with the limiting critical
conditions listed in the table in 40 CFR part 82, subpart A, Appendix L
qualify for critical uses in 2008. EPA further responds to comments
about the efficacy of sulfuryl fluoride in the response to comment
document for this rulemaking.

One commenter notes that EPA recently approved the use of iodomethane
(methyl iodide) for field uses, which will reduce the need for methyl
bromide CUE allocations. The commenter states that iodomethane is a
drop-in substitute for methyl bromide and that while it is more costly
per kilogram, less of it is required to achieve the same efficacy. The
commenter also states that while iodomethane poses direct toxicity
issues, the toxicity issues associated with methyl bromide are worse.

One commenter requests that EPA assess the technical and economic
feasibility of methyl iodide for no fewer than two years before
factoring its availability into future CUE decisions. The commenter
believes that the controversial nature of the registration combined with
the proximity of the registration to the close of the comment period on
the CUE rule provide reason to delay considering this alternative when
allocating CUEs. The commenter also notes that methyl iodide is not yet
registered in California because of safety questions and that there is
anecdotal evidence of efficacy problems with the chemical. The commenter
believes that at least two growing seasons are necessary to review and
assess viability.

[The Agency acknowledges that iodomethane is now registered at the
Federal level (time-limited)]{.mark} [for certain authorized critical
uses of methyl bromide, most notably, strawberries, tomatoes, peppers,
and ornamental crops. Notwithstanding the registration status at a
Federal level, US growers cannot currently use iodomethane in their
production processes. The pesticide registration process in the United
States involves multiple layers of regulatory approval.]{.mark} [The
product must first be registered at the Federal level]{.mark} [and,
then,]{.mark} [each State can elect to register or not register the
chemical for use in that state. Similarly, the pesticide registrant has
the option of not seeking registration in a particular state. To date,
no state has registered iodomethane for use. Without state registrations
in place, the Agency is not in a position to reduce production levels
for methyl bromide based on the status of the Federal registration
alone.]{.mark}

Dow AgroSciences (Dow) provided extensive comments objecting to EPA's
assessment of the label restriction on 1,3-D product use near karst
topographical features in Florida. The Agency's assessment of those
restrictions was part of the basis for the 2008 and 2009 CUN for
pre-plant critical uses in Florida. The commenter asserts that EPA's
karst impact assessment represents an unnecessarily simplified, regional
assessment inappropriate to assess a site-specific restriction. The
commenter asserts that EPA's 2007 assessment is not an accurate
reflection of the current 1,3-D product label restrictions which
specifies that a particular field is not impacted unless there is a
karst surface feature within 100' of the edge of that field, independent
of the percentage of the surrounding area which may contain karst
surface features. The commenter references two field-level evaluations
of occupied structures that have been conducted in rural and urban
agricultural areas of Florida and Georgia. The commenter believes that
EPA should use the methods in those studies as a surrogate for karst
surface features. The commenter states that results of these analyses
indicate that restrictions on product use associated with features
(either occupied structures or karst surface features) at distances of
≤100' can be expected to have an impact on agricultural uses ranging
from 1% to 5.5% of the affected area compared to the proposed impact of
up to 93% that is assigned to the 1,3-D karst restriction in the 2007
U.S. assessment. The commenter also mentions that additional information
on this further characterization of the karst impact was presented to
EPA by Dow at a meeting on July 25, 2007 and submitted that information
as separate documents into the public docket associated with this rule.

EPA disagrees with the commenter's critique of EPA's 2007 karst impact
assessment. It appears that Dow is arguing that occupied structures can
be used as a proxy for karst surface features, and that therefore
analyses that examine the presence of occupied structures as a
restriction to fumigant use are appropriate to use for estimates of the
karst impact. However, Dow assumes that karst features will occur with a
frequency and distribution similar to that of occupied structures in all
agricultural counties of Florida. Unless Dow has data to support this
presumption, information which they have not presented, EPA does not see
how using occupied structures as a proxy for karst topological features
is valid. Therefore, we believe that our methodology of using geological
maps which identify "sensitive karst areas" is superior.

Dow's comments go on to state that the 2007 U.S. government assessment
concludes that the soils restriction causes 23% to 100% of agricultural
land in Florida to be unsuitable for 1,3-D uses due to the
state-specific ("Special Local Need" registrations for 1,3-D products)
soil requirements. The commenter states that the U.S. Government
included in their assessment, agricultural land (in Alachua, Gadsden and
Jackson counties) that is not subject to the specific Florida soil
restrictions. In addition, the commenter states that the 2007 soils
assessment relies on a simplified soil assessment that characterizes the
percentage of soil areas, by county, which are non-suitable for 1,3-D
applications. The county-specific percentage values are then used to
determine the percentage of agricultural land within that county that is
unsuitable for 1,3-D uses. This represents a significant overestimation
of impact, in the commenter's opinion, because non-agricultural land is
considered into the assessment. A more refined assessment utilizing GIS
and land-use data, provided by Dow AgroSciences in 2002, indicates that
the southern Florida soil restriction has the potential to impact up to
only 24.6% of agricultural land in the key south Florida counties. The
commenter mentions that this information was shared with EPA in 2002 and
2007 and is placed in separate documents into the public docket that is
associated with this proposed rule.

EPA agrees with the commenter that three counties included in the 2007
U.S. assessment are not subject to the second "seepage irrigation" SLN
restriction, and that these counties should be removed from the portion
of the analysis done for the CUNs. These counties would be Alachua,
Gadsden and Jackson counties. However, even completely removing these
counties from EPA's analysis of soil restrictions would remove only a
relatively small amount of crop acreage: EPA's analysis only considered
the strawberry crop in Alachua county, a total of 22 acres harvested,
and a total of 2,513 acres of tomato in Gadsden and Jackson counties
(out of a total of 43,790 acres harvested in the state). Crop acreage
information is taken from Appendix B of the 2006 CUN for tomatoes,
eggplants, peppers, and strawberry fruit. EPA notes, however, that these
three counties are still affected by the 'karst' restriction on 1,3-D
(Telone ®)use. Therefore, even though EPA will consider the commenter's
recommended revisions in future analysis, the Agency does not believe
these revisions support changing the proposed amount of critical use
methyl bromide for pre-plant uses in 2008.

Regarding Dow's comments on the technical aspects of the
Florida-specific "seepage irrigation" portion of EPA's soils analysis
described: EPA examined the information supplied by Dow at its meeting
with Agency staff in July 2007. In addition to the differences in
methods for estimating the impact of the karst restriction that are
discussed above, a major difference between the Dow analysis of seepage
irrigation restrictions and the EPA analysis is that the EPA analysis
assumes that the agricultural land is distributed within the county in
proportion to its overall percentage rather than looking at the specific
location of agricultural land used in the production of row crops.

Dow is correct in stating that using the actual location of agricultural
land would provide a refined estimate of potential 1,3-D product use.
However, this refinement would change the overall assessment very
little. Particularly in counties which are largely agricultural, the
difference between the EPA and Dow estimates is very small. The fact
that the estimates of karst-restricted areas must be overlaid on the
areas affected by seepage irrigation restrictions reduces the
differences still further. The county where the difference is the most
pronounced is Palm Beach, a county where agricultural use makes up a
relatively small proportion of land use. Palm Beach County is
approximately the 5^th^ most important tomato-producing county in
Florida, producing 7-8% of the 2002 tomato crop (2002 is the most recent
year for which such data were available and thus the year used for the
analysis). Palm Beach County is not a significant producer of
strawberries. Strawberries and tomatoes are the Florida crops for which
the largest methyl bromide request is put forward in 2008 U.S. Critical
Use Nomination. Thus, changing the estimate of the proportion of land in
Palm beach County that is eligible to use 1,3-D products will make very
little difference to the overall assessment of the proportion of Florida
cropland where 1,3-D products can be used in place of methyl bromide.
Therefore, EPA does not believe the commenter's critique of EPA's
analysis supports changing the proposed amount of critical use methyl
bromide for pre-plant uses in 2008.

EPA emphasizes that it is very interested in refining its estimates of
the impact of soil related restrictions on 1,3-D use in Florida, and is
open to working with Dow to do so for future methyl bromide CUE
assessments. EPA notes here that in order to significantly alter its
current karst analysis, EPA would need to see more than just a summary
of Dow's study, but rather a detailed description of the study,
including data sources, analytical methods, and dataset sizes if
appropriate.

In this action, EPA is reducing the proposed critical use amount for
post-harvest cocoa fumigation by 17,690 kg. EPA is not reducing any of
the other proposed critical use amounts for 2008 to account for the
uptake of alternatives, because uptake of alternatives was already
considered in the 2008 U.S. CUN, adopted by MBTOC, and reflected in the
2008 CUE authorization amounts that EPA is finalizing with this action.
Furthermore, the most recent information that EPA has does not support
further reductions.

**[E. Record Keeping and Reporting Requirements]{.mark}**

[***1. Reporting***]{.mark}

[With this action, individuals or legal entities that produce,
distribute, sell, apply, or buy methyl bromide are required to report
the name of every non-end user entity (i.e. producer, distributor or
applicator) to which they sell critical use methyl bromide in each
control period. These requirements will be added to the existing annual
reporting requirements at 40 CFR]{.mark} [Part 82.13 for critical uses
of methyl bromide. To collect this information, EPA will add a section
to the form titled Sales of Critical Use Methyl Bromide to End Users
Report (OMB Control Number 2060-0564), which must be submitted no later
than 45 days after the 31^st^ of December each year. This new annual
reporting requirement will begin for the 2008 control period, meaning
that no later than 45 days after December 31, 2008, producers,
distributors and applicators must submit the name of every non-end user
entity to which they sell critical use methyl bromide during the 2008
control period. EPA is also requesting this information for the 2007
control period under a separate Section 114 information request.\[Why
can't you do this for 2007 as part of this rulemaking?\] Section VI.B of
this preamble provides more information about the information collection
requirements in this rule, and compliance with the Paperwork Reduction
Act.]{.mark}

[EPA is adding the reporting requirement described above to enhance
compliance tracking of the critical use allowance and critical stock
allowance caps; and determinations of how much critical use methyl
bromide remains unused at the end of the compliance period. The
information collected for this exemption is authorized under Sections
603(d) and 614(b) of the Clean Air Act Amendments of 1990. EPA believes
these reporting requirements will enhance EPA's fulfillment of U.S.
reporting obligations under Article 7 of the Protocol, Clean Air Act
reporting requirements to Congress under Section 603(d), and
implementation of the critical use exemption under Section 604(d)(6)
from one control period to the next. Furthermore, EPA believes that
today's recordkeeping and reporting requirements create the least burden
while still ensuring that EPA is able to meaningfully improve its
implementation of the U.S. critical use exemption framework established
in the December 23, 2004 Framework Rule (69 FR 76997).]{.mark}

[In developing this action, EPA specifically requested comment on
whether requiring producers, distributors and applicators to report the
names of non-end user entities to which they have sold critical-use
methyl bromide would provide valuable information to EPA, and help to
encourage complete reporting . EPA sought comment on whether this would
justify the additional burden of such requirements (72 FR 48970). EPA
did not receive any comments opposing this additional reporting
requirement.]{.mark}

[EPA received six comments supporting a petition submitted by Chemtura
to augment the current reporting and record keeping process to prevent
underreporting of methyl bromide use. The commenters propose that EPA
modify its reporting system in a manner that would allow the Agency to
identify non-reporting companies and the amount of critical use sales
attributable to each non-reporting company. EPA could achieve this, the
commenters assert, by requiring each entity in the supply chain -- from
the manufacturer to the company that sells to the end user -- to file a
report stating who that entity sold critical use methyl bromide to and
how much material it sold. EPA agrees with the commenters that
collecting information that would allow EPA to identify non-reporting
companies would assist EPA's efforts to encourage full reporting, and
increase incentives for regulated entities to properly submit required
reports. However, EPA does not agree that it should require information
that would allow the Agency to quantify the amount of critical use sales
attributable to each non-reporting company. Instead of imposing
additional burden on entities that do report in order to obtain
information about non-reporters, the Agency believes a more
straightforward and practical approach is to encourage full reporting.
EPA believes that collecting the names of all entities with reporting
requirements in each control period will increase incentives for full
reporting, facilitate Agency follow-up with non-reporters, and thus
diminish any advantages of collecting more detailed information, about
non-reporting entities.]{.mark}

[EPA used previous information collection request (ICR) analyses of
burden hours for existing methyl bromide reporting requirements as a
guideline to estimate the burden associated with the additional
reporting requirements that the commenters propose. The Agency estimates
that annually requiring producers, distributors and third-party
applicators to provide the names of entities, excluding end-users, to
whom they sell critical use methyl bromide would add approximately 90
burden hours to all responders each year, or roughly 90 minutes per
respondent per year. EPA believes the benefits of collecting that
additional information would outweigh the associated administrative
burden for respondents. EPA also estimates that considering all burden
hours and other costs, it would cost the Agency less than \$1,300 per
year to process this additional information.]{.mark}

[EPA also estimated the burden associated with collecting information
that would allow the Agency to determine the amount of methyl bromide
sold to each non-reporting entity, as the commenters recommend. Using
previous ICR analyses as a guideline, EPA estimates that collecting
information about the amount of critical use methyl bromide sold to each
non-end user would be more complicated than simply requiring the names
of those entities. EPA expects that in some cases respondents would have
to compile multiple sales transaction records for each non-end user
entity to which they sold methyl bromide. Therefore, EPA estimates that
this reporting would impose an additional 60 burden hours to all
respondents each year, or roughly one hour per respondent per year. EPA
also estimates that it would cost the Agency more than \$2,500 per year
to process this new information. Most importantly, EPA does not believe
this reporting requirement would have any environmental benefit, or help
to meet the primary goals of the critical use exemption program.
Therefore, with this action, EPA will not require respondents to provide
information about the amount of methyl bromide sold to each non-end user
each year.]{.mark}

[EPA received one comment from the]{.mark} [Natural]{.mark} [Resources
Defense Council stating that EPA should require reporting of the names
of distributors and third-party applicators to which they have sold any
methyl bromide, including pre-2005 stocks, in order to get accurate data
to track amounts sold for all purposes (including non-critical
purposes). As EPA moves forward with the ICR renewal processes in 2008,
the Agency intends to give further consideration to the commenter's
suggestion that EPA collect the names of distributors and applicators
that buy pre-phaseout material. However, because the Agency did not
specifically seek comment on this additional requirement in the proposed
rule, EPA would like to gather more input before deciding whether to
implement the commenter's proposal.]{.mark}

[*2. Recordkeeping*]{.mark}

[This action does not impose any additional recordkeeping requirements,
as the regulated community is already required, under 40 CFR]{.mark}
[Part 82.13, to keep methyl bromide sales records and invoices for three
years.]{.mark}

**F. The Criteria in Decisions IX/6 and Ex. I/4**

Paragraphs 2 and 6 of Decision XVIII/13 request parties to ensure that
the conditions or criteria listed in Decisions Ex. I/4 and IX/6,
paragraph 1, are applied to exempted critical uses for the 2008 control
period. A discussion of the Agency's application of the criteria in
paragraph 1 of Decision IX/6 appears in sections V.A., V.C., V.D., and
V.H. of this preamble. The critical use nominations (CUNs) detail how
each proposed critical use meets the criteria listed in paragraph 1 of
Decision IX/6, apart from the criterion located at (b)(ii), as well as
the criteria in paragraphs 5 and 6 of Decision Ex. I/4.

The criterion in Decision IX/6(1)(b)(ii), which refers to the use of
available stocks of methyl bromide, is addressed in sections V.D., V.G.,
and V.H. of this preamble. The Agency has previously provided its
interpretation of the criterion in Decision IX/6(1)(a)(i) regarding the
presence of significant market disruption in the absence of an
exemption, and EPA refers readers to the 2006 CUE final rule (71 FR
5989) as well as to the memo on the docket titled "*Development of 2003*
*Nomination for a Critical Use Exemption for Methyl Bromide for the
United States of America*" for further elaboration.

The remaining considerations, including the lack of available
technically and economically feasible alternatives under the
circumstance of the nomination; efforts to minimize use and emissions of
methyl bromide where technically and economically feasible; the
development of research and transition plans; and the requests in
Decision Ex. I/4(5) that Parties consider and implement MBTOC
recommendations, where feasible, on reductions in the critical use of
methyl bromide and in paragraph 6 for Parties that submit critical use
nominations to include information on the methodology they use to
determine economic feasibility, are all addressed in the nomination
documents.

Some of these criteria are evaluated in other documents as well. For
example, the U.S. has further considered matters regarding the adoption
of alternatives and research into methyl bromide alternatives, criterion
(1)(b)(iii) in Decision IX/6, in the development of the National
Management Strategy (NMS) submitted to the Ozone Secretariat in December
2005 and in on-going consultations with industry. The NMS addresses all
of the aims specified in Decision Ex.I/4(3) to the extent feasible and
is available in the docket for this rulemaking.

**G. Emissions Minimization**

In the proposed rule, EPA noted for the regulated community the
reference to emission minimization techniques in paragraph 8 of Decision
XVIII/13, which states that Parties shall request critical users to
employ "emission minimization techniques such as virtually impermeable
films, barrier film technologies, deep shank injection and/or other
techniques that promote environmental protection, whenever technically
and economically feasible." EPA understands that research is being
conducted on the potential to reduce rates and emissions using newly
available high-barrier films and that these studies show promising
results. Users of methyl bromide should make every effort to minimize
overall emissions of methyl bromide by implementing measures such as the
ones listed above, to the extent consistent with state and local laws
and regulations. In the proposed rule, the Agency encouraged researchers
and users who are successfully utilizing such techniques to inform EPA
of their experiences as part of their comments and to provide such
information with their critical use applications. In addition, the
Agency welcomed comments on the implementation of emission minimization
techniques and whether and how further emission minimization could be
achieved.

One commenter believes that EPA should create a regulatory incentive for
emissions reduction. One commenter states that the most effective way to
achieve further emission minimization is to require the use of emission
minimization techniques such as virtually impermeable films (VIF),
barrier films, and deep shank injection. The commenter notes that these
techniques offer the concurrent benefit of reducing the amount of methyl
bromide needed for fumigations. EPA believes that reducing supply
through the phaseout will provide an incentive for use minimization and
therefore limit emissions. Other points discussed by this commenter can
be found in the corresponding Response to Comments document for this
action.

One commenter notes that virually impermeable film (VIF) keeps the
methyl bromide applied in the soil longer so it is metabolized in the
soil rather than escaping into the atmosphere. The commenter believes
that methyl bromide that is used in this way should not be decreased
since it is not reaching the ozone layer. EPA has not fully reviewed the
research that the commenter is referring to. In compiling annual
critical use nominations, the United States Government considers the
feasibility of VIF, and other less permeable tarps, because the use of
these technologies can reduce required dosage rates, and the critical
need for methyl bromide to treat certain crops. The commenter may be
proposing a different type of exemption for methyl bromide use that does
not result in emissions to the stratosphere, but this would require a
change in the Montreal Protocol which is outside the scope of the
present rulemaking. Until EPA fully reviews the research that the
commenter refers to, it would be inappropriate for the Agency to respond
further.

**H. Critical Use Allowance Allocations**

Each critical use allowance (CUA) is equivalent to 1 kg of critical use
methyl bromide. These allowances expire at the end of the control period
and, as explained in the Framework Rule, are not bankable from one year
to the next. This allocation of pre-plant and post-harvest CUAs to the
entities listed below is subject to the trading provisions at 40 CFR
82.12, which are discussed in section V.G. of the preamble to the
Framework Rule (69 FR 76982).

In the August 27, 2007 proposed rule, EPA proposed to allow limited
amounts of new production or import of methyl bromide for critical uses
for 2008 up to the amount of 3,101,076 kg (12.2% of baseline) as shown
in Table II below. EPA sought comment on the total levels of exempted
new production or import for pre-plant and post-harvest critical uses in
2008. For the reasons discussed in Section V.D. of this preamble EPA is
adjusting the proposed CUA amounts to account for late sales reports
that decrease the calculated 2006 carry over amount \[list other
changes\]. Therefore, the total critical use exemption amount for 2008
is 4,823,531 kg (18.9% baseline), with 3,098,981 kg (12.1% baseline) of
critical use allowances allowing new production or import, and the
remaining amount, 1,724,550 kg (6.8% baseline), available through
critical stocks allowances (CSAs) that allow critical users to access
pre-phaseout methyl bromide. EPA is continuing to calculate
company-specific CUA allocations on the basis of the 1991 baseline
consumption share of the companies listed in Table II. The updated
calculation spreadsheet is available on Docket ID No.
EPA-HQ-OAR-2006-1016. Therefore, the CUAs are allocated as follows:

**Table II: Proposed Allocation of Critical Use Allowances**

+-----------------------+-----------------------+-----------------------+
| **Company**           | **2008 Critical use   | **2008 Critical use   |
|                       | allowances for        | allowances for        |
|                       | pre-plant uses\*      | post-harvest uses\*   |
|                       | (kilograms)**         | (kilograms)**         |
+-----------------------+-----------------------+-----------------------+
| Great Lakes Chemical  | 1,695,734             | 187,516               |
| Corp.                 |                       |                       |
|                       |                       |                       |
| A Chemtura Company    |                       |                       |
+-----------------------+-----------------------+-----------------------+
| Albemarle Corp.       | 697,324               | 77,111                |
+-----------------------+-----------------------+-----------------------+
| Ameribrom, Inc.       | 385,356               | 42,613                |
+-----------------------+-----------------------+-----------------------+
| TriCal, Inc.          | 11,999                | 1,327                 |
+-----------------------+-----------------------+-----------------------+
| *Total*               | *2,790,414*           | *308,567*             |
+-----------------------+-----------------------+-----------------------+

\* For production or import of class I, Group VI controlled substance
exclusively for the Pre-Plant or Post-Harvest uses specified in Appendix
L to 40 CFR Part 82.

Paragraph five of Decision XVIII/13 states "that Parties shall endeavor
to license, permit, authorize, or allocate quantities of critical use
methyl bromide as listed in tables A and C of the annex to the present
decision." This is similar to language in Decisions Ex. I/3(4), Ex.
II/1(4) and VII/9(4) regarding 2005, 2006 and 2007 critical uses,
respectively. The language from these Decisions calls on Parties to
endeavor to allocate critical use methyl bromide on a sector basis.

In establishing the critical use exemption program, the Agency
endeavored to allocate directly on a sector-by-sector basis by analyzing
and proposing this option among others in the August 2004 Framework Rule
notice (69 FR 52366). EPA solicited comment on both universal and
sector-based allocation of critical use allowances. The Agency evaluated
the various options based on their economic, environmental, and
practical effects. After receiving comments, EPA determined in the final
Framework Rule (69 FR 76989) that a lump-sum, or universal, allocation,
modified to include distinct caps for pre-plant and post-harvest uses,
was the most efficient and least burdensome approach that would achieve
the desired environmental results, and that a sector-specific approach
would pose significant administrative and practical difficulties.
Although the approach adopted in the Framework Rule does not directly
allocate allowances to each category of use, the Agency anticipates that
reliance on market mechanisms will achieve similar results indirectly.
The TEAP recommendations are based on data submitted by the U.S. which
in turn are based on recent historic use data in the current methyl
bromide market. In other words, the TEAP recommendations agreed to by
the Parties are based on current use and the current use patterns take
place in a market where all pre-plant and post-harvest methyl bromide
uses compete for a lump sum supply of critical use material. Therefore,
the Agency believes that under a system of universal allocations,
divided into pre-plant and post-harvest sectors, the actual critical use
will closely follow the sector breakout listed by the TEAP. These issues
were addressed in the the Framework Rule and EPA is not aware of any
factors that would alter the analysis performed during the development
of previous CUE allocation rules. A summary of the options analysis
conducted by EPA is available in the docket for this rulemaking.

In developing this action, EPA did not propose to change the approach
adopted in the Framework Rule for the allocation of CUAs but, in an
effort to endeavor to address Decision XVIII/13(5), EPA sought
additional comment on the Agency's allocation of CUAs in the two
groupings (pre-plant and post-harvest) that the Agency has employed in
the past. Two commenters note that the universal system is working well
and believe the concept of the pre-plant/post-harvest allocations is
simple and easy for stakeholders to understand. The commenters also note
that the system has not disrupted the supply chain and has been easy for
distributors to implement. One of the commenters discourages the Agency
from switching to a sector-by-sector allocation system.

Two commenters state that the geographical distribution of methyl
bromide has created shortfalls resulting in the inability of individual
growers to access or afford material to fumigate their fields in
accordance with their production schedules. One commenter indicates that
this was particularly noticeable during the 2005 and 2006 fall
fumigation periods. One commenter states that the universal system does
not work well for the above reasons, but believes that a
sector-by-sector allocation system would be equally flawed due to
insufficient allocations in certain sectors and unequal holding of
stocks.

One commenter believes that EPA should explore a hybrid between a
regional and a lump-sum allocation system. Specifically, the commenter
suggests that EPA consider creating several large regional areas (such
as the EPA regions) that combine all of the sectors within each region
to create a regional lump-sum. The commenter further states that the
methyl bromide users who most frequently face difficulty obtaining
methyl bromide are small, minority growers. The commenter argues that
the allocation of methyl bromide creates a harm that is
disproportionately distributed.

The commenter's primary concern is not human health and environmental
effects on minority or low-income populations. Instead, the commenter
believes that EPA's current allocation system causes economic harm for
these populations, because they have difficulty satisfying their
critical needs for methyl bromide.

This final rule creates an exemption to the phaseout of methyl bromide.
The overall impact of this action is deregulatory, and has an economic
benefit for growers with critical needs for methyl bromide. EPA responds
further to this comment in the Response to Comment document for this
action.

EPA agrees with the commenters that support the existing allocation
system. EPA considered sector-specific, and other allocation approaches
in the Framework Rule, and decided that the existing universal
allocation system with pre-plant and post-harvest allowances is the most
effective and least burdensome system. In the Framework Rule, EPA did
not consider a regional approach, as one commenter suggests. EPA may
consider such an approach for future CUE rules. EPA does not believe it
would be appropriate to finalize such an approach without giving other
interested parties an opportunity for comment. EPA responds to these
comments further in the Response to Comment document available on the
docket for this action.

**H. Critical Stock Allowance Allocations and the Confidentiality of
Information about the Aggregate Methyl Bromide Inventory**

Each critical stock allowance (CSA) is equivalent to 1 kg of critical
use methyl bromide. These allowances expire at the end of the control
period and, as explained in the Framework Rule, are not bankable from
one year to the next (69 FR 76990). CSAs are not used to produce or
import methyl bromide but are rights that enable the holder to sell
pre-phaseout inventories of methyl bromide for use in approved critical
uses. A CSA is expended when the entity selling methyl bromide sells the
material, or fumigation services with the material, to an approved
critical user who certifies that the material is for an approved
critical use. Thus, the movement of pre-phaseout inventories or methyl
bromide along the supply chain does not require expenditures of a CSA.

In developing this action, EPA proposed to allocate critical stock
allowances (CSAs) to the entities listed below in Table III for the 2008
control period in the amount of 1,724,550 kg (6.8% of US 1991 baseline).
EPA's proposal was based on the proposed approach for accounting for
available stocks of methyl bromide, which is described in Section V.D.
of this preamble. For the reasons discussed in Section V.D., in this
action EPA is allocating 1,724,550 kg of CSAs to the entities listed in
Table 3 below. The amounts are apportioned to each entity in proportion
to inventory held by each on January 1, 2007.

In 2006 the United States District Court for the District of Columbia
upheld EPA's treatment of company-specific methyl bromide inventory
information as confidential. NRDC v. Leavitt, 2006 WL 667327 (D.D.C.
March 14, 2006). EPA's allocation of CSAs is based on each company's
proportionate share of the aggregate inventory. Therefore, the
documentation regarding company-specific allocation of CSAs is in the
confidential portion of the rulemaking docket and the individual CSA
allocations are not listed in the table below. EPA will inform the
listed companies of their CSA allocations in a letter following
publication of the final rule.

In developing this action, EPA explained that several companies that
receive small amounts of CSAs from EPA have contacted the Agency and
requested that they be permitted to permanently relinquish their
allowances. Due to the small CSA allocation and because they typically
do not sell critical use methyl bromide, they find the allocation of
CSAs, and associated record-keeping and reporting requirements, to be
unduly burdensome. In response to this concern, in the Proposed 2007 CUE
rule EPA proposed to allow CSA holders, on a voluntary basis, to
permanently relinquish their allowances through written notification to
the Agency. EPA received no adverse comments. However, no CSA holders
contacted EPA to take advantage of that voluntary opportunity. In the
2008 proposed rule EPA again gave CSA holders the opportunity, on a
voluntary basis, to permanently relinquish their allowances through
written notification to the Agency. EPA explained that companies
voluntarily relinquishing their allowances would not receive CSA
allocations and would be excluded from future allocations, and that all
allowances forfeited by companies would be reallocated to the remaining
companies on a pro-rata basis.

[Seven companies voluntarily contacted EPA during the comment period for
this action and requested to relinquish their CSAs. The companies that
contacted the Agency were: Blair Soil Fumigation, Dodson Brothers,
Carolina Eastern Inc., Harvey Fertilizer & Gas, J.C. Ehrlich Co.,
Southern States Cooperative Inc., and Vanguard Fumigation Co. With this
final rule, EPA is honoring their requests and removing these seven
companies from Table 3 below. Additionally, EPA will not issue CSAs to
these seven companies in future control periods. EPA has reallocated
their CSAs to the remaining companies on a pro-rata basis.]{.mark}

**Table III: Allocation of Critical Stock Allowances**

  ----------------------------------- -----------------------------------
  **Company**                         

  Albemarle                           Pacific Ag

  Ameribrom, Inc.                     Pest Fog Sales Corp.

  Bill Clark Pest Control, Inc.       Prosource One

  Burnside Services, Inc.             Reddick Fumigants

  Cardinal Professional Products      Royster-Clark, Inc.

  Degesch America, Inc.               Trical Inc.

  Chemtura Corp. (Why not Chemtura?)  Trident Agricultural Products

  Helena Chemical Co.                 UAP Southeast (NC)

  Hendrix & Dail                      UAP Southeast (SC)

  Hy Yield Bromine                    Univar

  Industrial Fumigation Company       Western Fumigation

  *TOTAL -- 1,724,550 kilograms*      
  ----------------------------------- -----------------------------------

**I. Stocks of Methyl Bromide**

As discussed above and in the December 23, 2004 Framework Rule, an
approved critical user may obtain access to exempted production and
import of methyl bromide and to limited inventories of pre-phaseout
methyl bromide, the combination of which constitute the supply of
"critical use methyl bromide" intended to meet the needs of agreed
critical uses. The Framework Rule established provisions governing the
sale of pre-phaseout inventories for critical uses, including the
concept of CSAs and a prohibition on the sale of pre-phaseout
inventories for critical uses in excess of the amount of CSAs held by
the seller. In the Framework Rule EPA also established trading
provisions that allow critical use allowances (CUAs) to be converted
into CSAs. Under this action, no significant changes are being made to
those provisions.

Comments from the Natural Resources Defense Council (NRDC) state that
EPA should dedicate all pre-phaseout stocks of methyl bromide to CUEs.
The Agency notes that it has responded to similar comments in the Final
Framework Rule (69 FR 76988), the Final 2007 CUE Rule (71 FR 75400), and
in response to NRDC's late submission of supplemental comments on the
Proposed 2007 CUE Rule. EPA is not revisiting this issue in this
rulemaking.

With regard to information about stocks of methyl bromide, in the
proposed rule EPA explained in detail how it acquired that information
from 2003 until the present, and how EPA had applied its regulations on
treatment of information claimed as confidential. In the proposed rule,
EPA noted that it did not receive any objections to releasing the
aggregate stocks information for calendar year 2006. To simplify the
process of releasing future aggregate stocks information, EPA proposed
to release the aggregate of methyl bromide stockpile information
reported to the Agency under the reporting requirements at 40 CFR 82.13
for the end of 2007, and each year thereafter. For the reasons given in
a letter that EPA sent on April 23, 2007, which is available in the
docket, to all entities which had reported holding pre-phaseout
inventory at the end of 2003, 2004, 2005 or 2006, this aggregate
information is clearly not entitled to confidential treatment. EPA
proposed to release the aggregate of this stockpile data in future years
without first notifying entities by letter, as EPA has done in the past
two years. EPA sought comment on this proposal. In the proposed rule,
the Agency stated that if it did not receive any comments opposing its
proposal, the aggregate of methyl bromide stockpile data collected under
the reporting requirements at 40 CFR 82.13 would not be treated as
confidential information and could be released in future without
additional notice to the competitors.

EPA received one comment from the Methyl Bromide Industry Panel (MBIP)
stating that MBIP does not object to EPA's proposal to release aggregate
stockpile data in future years at this time. MBIP notes that they
reserve the right to object in the future should the number of
competitors in the industry dwindle to two or fewer in order to protect
confidentiality. Therefore, because EPA received no comments objecting
to its proposal at the present time, for as long as there are at least
three competitors in the industry, the aggregate of methyl bromide
stockpile data collected under the reporting requirements at 40 CFR
82.13 will not be treated as confidential information and may be
released in future without further notice. However, if the number of
competitors in the industry were to dwindle to two or fewer, EPA would
revisit the question of whether the aggregate is entitled to treatment
as confidential information and would not release the aggregate without
notice.

**VI. Statutory and Executive Order Reviews**

**A. Executive Order 12866: Regulatory Planning and Review**

Under Executive Order (EO) 12866 (58 FR 51735, October 4, 1993), this
action proposes a "significant regulatory action," because it raises
novel or legal policy issues arising out of legal mandates, the
President's priorities, or the principles set forth in the Executive
Order. Accordingly, EPA submitted this action to the Office of
Management and Budget (OMB) for review under EO 12866 and any changes
made in response to OMB recommendations have been documented in the
docket for this action.

**[B. Paperwork Reduction Act]{.mark}**

[The new information collection requirements in this rule, explained
further in Section E of this preamble, will be submitted for approval to
the Office of Management and Budget (OMB) under the *Paperwork Reduction
Act* (PRA), 44 U.S.C. 3501 *et seq.* The information collection
requirements are not enforceable until OMB approves them. OMB has
previously approved the information collection requirements contained in
the existing regulations at 40 CFR Part 82 under the provisions of the
Paperwork Reduction Act, 44 U.S.C. 3501 [et]{.underline}
[seq]{.underline}. and has assigned OMB control number 2060-0564, and
EPA ICR number 2179.03. A copy of the OMB approved Information
Collection Request (ICR) may be obtained from Susan Auby, Collection
Strategies Division; U.S. Environmental Protection Agency (2822T); 1200
Pennsylvania Ave., NW, Washington, DC 20460 or by calling (202)
566-1672.]{.mark}

[The new information collection requirements in this rule are authorized
under Sections 603(d) and 614(B) of the CAAA of 1990.]{.mark}

[The new mandatory reporting requirements included in this rule are
intended to:]{.mark}

[(1) Enhance compliance with U.S. obligations under the international
treaty, *The Montreal Protocol on Substances that Deplete the Ozone
Layer* (Protocol), to report data under Article 7;]{.mark}

[(2) Enhance information provided to Congress on the production, use and
consumption of class I controlled substances as statutorily required in
Section 603(d) of the CAAA of 1990.]{.mark}

The new information will be collected through annual reporting by
producers, importers, distributors and third-party applicators of methyl
bromide. EPA estimates the total burden associated with the new
requirements in today's action to be 90 hours annually. EPA does not
estimate any start-up of capital costs associated with today's action.

  --------------------------- ----------------------- --------------------- -------------------- -----------------
  **[Collection               **[No. of               **[Total No. of       **[Hours per         **[Total
  Activity]{.mark}**          Respondents]{.mark}**   Responses]{.mark}**   Response]{.mark}**   Hours]{.mark}**

  **[Rule                     [60]{.mark}             [60]{.mark}           [0.5]{.mark}         [30]{.mark}
  Familiarization]{.mark}**                                                                      

  **[Data Compilation (annual [60]{.mark}             [60]{.mark}           [0.5]{.mark}         [30]{.mark}
  basis)]{.mark}**                                                                               

  **[Data Reporting (annual   [60]{.mark}             [60]{.mark}           [0.5]{.mark}         [30]{.mark}
  basis)]{.mark}**                                                                               

  **[Total Burden             [ ]{.mark}              [ ]{.mark}            [1.5]{.mark}         [90]{.mark}
  Hours]{.mark}**                                                                                
  --------------------------- ----------------------- --------------------- -------------------- -----------------

[]{.mark}

[Burden means the total time, effort, or financial resources expended by
persons to generate, maintain, retain, or disclose or provide
information to or for a Federal agency. This includes the time needed to
review instructions; develop, acquire, install, and utilize technology
and systems for the purposes of collecting, validating, and verifying
information, processing and maintaining information, and disclosing and
providing information; adjust the existing ways to comply with any
previously applicable instructions and requirements; train personnel to
be able to respond to a collection of information; search data sources;
complete and review the collection of information; and transmit or
otherwise disclose the information.]{.mark}

[An agency may not conduct or sponsor, and a person is not required to
respond to a collection of information unless it displays a currently
valid OMB control number. The OMB control numbers for EPA\'s regulations
in 40 CFR are listed in 40 CFR part 9. \[How will EPA notify public
if/when OMB approves the new ICR?\]]{.mark}

**C. Regulatory Flexibility Act**

The Regulatory Flexibility Act (RFA) generally requires an agency to
prepare a regulatory flexibility analysis of any rule subject to
notice-and-comment rulemaking requirements under the Administrative
Procedure Act or any other statute unless the agency certifies that the
rule will not have a significant economic impact on a substantial number
of small entities. Small entities include small businesses, small
organizations, and small governmental jurisdictions. For purposes of
assessing the impacts of this action on small entities, small entity is
defined as: (1) a small business that is identified by the North
American Industry Classification System (NAICS) Code in the Table below;
(2) a small governmental jurisdiction that is a government of a city,
county, town, school district or special district with a population of
less that 50,000; and (3) a small organization that is any
not-for-profit enterprise which is independently owned and operated and
is not dominant in its field.

+---------------+----------------+------------------+-----------------+
| Category      | NAICS code     | SIC code         | NAICS Small     |
|               |                |                  | business size   |
|               |                |                  | standard (in    |
|               |                |                  | number of       |
|               |                |                  | employees or    |
|               |                |                  | millions of     |
|               |                |                  | dollars)        |
+---------------+----------------+------------------+-----------------+
| Agricultural  | 1112-          | 0171- Berry      | \$0.75 million  |
| production    | Vegetable and  | Crops            |                 |
|               | Melon farming  |                  | \$6.5 million   |
| Storage Uses  |                | 0172- Grapes     |                 |
|               | 1113- Fruit    |                  | 500 employees   |
| Distributors  | and Nut Tree   | 0173- Tree Nuts  |                 |
| and           | Farming        |                  | \$23.5 million  |
| Applicators   |                | 0175- Deciduous  |                 |
|               | 1114-          | Tree Fruits      | \$6.5 million   |
| Producers and | Greenhouse,    | (except apple    |                 |
| Importers     | Nursery, and   | orchards and     | 500 employees   |
|               | Floriculture   | farms)           |                 |
|               | Production     |                  |                 |
|               |                | 0179- Fruit and  |                 |
|               | 115114-        | Tree Nuts, NEC   |                 |
|               | Postharvest    |                  |                 |
|               | Crop           | 0181- Ornamental |                 |
|               | activities     | Floriculture and |                 |
|               | (except Cotton | Nursery Products |                 |
|               | Ginning)       |                  |                 |
|               |                | 0831- Forest     |                 |
|               | 311211- Flour  | Nurseries and    |                 |
|               | Milling        | Gathering of     |                 |
|               |                | Forest Products  |                 |
|               | 311212- Rice   |                  |                 |
|               | Milling        | 2041- Flour and  |                 |
|               |                | Other Grain Mill |                 |
|               | 493110-        | Products         |                 |
|               | General        |                  |                 |
|               | Warehousing    | 2044- Rice       |                 |
|               | and Storage    | Milling          |                 |
|               |                |                  |                 |
|               | 493130- Farm   | 4221- Farm       |                 |
|               | Product        | Product          |                 |
|               | Warehousing    | Warehousing and  |                 |
|               | and Storage    | Storage          |                 |
|               |                |                  |                 |
|               | 115112- Soil   | 4225- General    |                 |
|               | Preparation,   | Warehousing and  |                 |
|               | Planting and   | Storage          |                 |
|               | Cultivating    |                  |                 |
|               |                | 0721- Crop       |                 |
|               | 325320-        | Planting,        |                 |
|               | Pesticide and  | Cultivation, and |                 |
|               | Other          | Protection       |                 |
|               | Agricultural   |                  |                 |
|               | Chemical       | 2879- Pesticides |                 |
|               | Manufacturing  | and Agricultural |                 |
|               |                | Chemicals, NEC   |                 |
+---------------+----------------+------------------+-----------------+

Agricultural producers of minor crops and entities that store
agricultural commodities are categories of affected entities that
contain small entities. This action will only affect entities that
applied to EPA for a de-regulatory exemption. In most cases, EPA
received aggregated requests for exemptions from industry consortia. On
the exemption application, EPA asked consortia to describe the number
and size distribution of entities their application covered. EPA
estimated that 3,218 entities petitioned EPA for an exemption for the
2005 control period. EPA received requests from a comparable number of
entities for the 2006, 2007, and 2008 control periods. Since many
applicants did not provide information on the distribution of sizes of
entities covered in their applications, EPA estimated that, based on the
above definition, between one-fourth and one-third of the entities may
be small businesses. In addition, other categories of affected entities
do not contain small businesses based on the above description.

After considering the economic impacts of this final rule on small
entities, EPA certifies that this action will not have a significant
economic impact on a substantial number of small entities. In
determining whether a rule has a significant economic impact on a
substantial number of small entities, the impact of concern is any
significant [adverse]{.underline} economic impact on small entities,
since the primary purpose of the regulatory flexibility analyses is to
identify and address regulatory alternatives "which minimize any
significant economic impact of the proposed rule on small entities." (5
U.S.C. §§ 603- 604). Thus, an Agency may certify that a rule will not
have a significant economic impact on a substantial number of small
entities if the rule relieves a regulatory burden, or otherwise has a
positive economic effect on all of the small entities subject to the
rule. Since this rule exempts methyl bromide for approved critical uses
after the phaseout date of January 1, 2005, this is a de-regulatory
action which will confer a benefit to users of methyl bromide. EPA
believes the estimated de-regulatory value for users of methyl bromide
is between \$20 million and \$30 million annually. We have therefore
concluded that this final rule will relieve regulatory burden for all
small entities.

**D. Unfunded Mandates Reform Act**

Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), P.L. 104-4,
establishes requirements for Federal agencies to assess the effects of
their regulatory actions on State, local, and tribal governments and the
private sector. Under section 202 of the UMRA, EPA generally must
prepare a written statement, including a cost-benefit analysis, for
proposed and final rules with \"Federal mandates\" that may result in
expenditures to State, local, and tribal governments, in the aggregate,
or to the private sector, of \$100 million or more in any one year.
Before promulgating an EPA rule for which a written statement is needed,
section 205 of the UMRA generally requires EPA to identify and consider
a reasonable number of regulatory alternatives and adopt the least
costly, most cost-effective or least burdensome alternative that
achieves the objectives of the rule. The provisions of section 205 do
not apply when they are inconsistent with applicable law. Moreover,
section 205 allows EPA to adopt an alternative other than the least
costly, most cost-effective or least burdensome alternative if the
Administrator publishes with the final rule an explanation why that
alternative was not adopted. Before EPA establishes any regulatory
requirements that may significantly or uniquely affect small
governments, including tribal governments, it must have developed under
section 203 of the UMRA a small government agency plan. The plan must
provide for notifying potentially affected small governments, enabling
officials of affected small governments to have meaningful and timely
input in the development of EPA regulatory proposals with significant
Federal intergovernmental mandates, and informing, educating, and
advising small governments on compliance with the regulatory
requirements.

This final rule contains no Federal mandates (under the regulatory
provisions of Title II of the UMRA) for State, local, or tribal
governments or the private sector. This action is deregulatory and does
not impose any new requirements on any entities. Thus, this proposed
rule is not subject to the requirements of sections 202 and 205 of the
UMRA. Further, EPA has determined that this rule contains no regulatory
requirements that might significantly or uniquely affect small
governments.

**E. Executive Order 13132: Federalism**

Executive Order 13132, entitled "Federalism" (64 FR 43255, August 10,
1999), requires EPA to develop an accountable process to ensure
"meaningful and timely input by State and local officials in the
development of regulatory policies that have federalism implications."
The phrase "policies that have federalism implications" is defined in
the Executive Order to include regulations that have "substantial direct
effects on the States, on the relationship between the national
government and the States, or on the distribution of power and
responsibilities among the various levels of government."

This final rule does not have federalism implications. It will not have
substantial direct effects on the States, on the relationship between
the national government and the States, or on the distribution of power
and responsibilities among the various levels of government, as
specified in Executive Order 13132. This final rule is expected to
primarily affect producers, suppliers, importers and exporters and users
of methyl bromide. Thus, Executive Order 13132 does not apply to this
final rule.

**F. Executive Order 13175: Consultation and Coordination with Indian
Tribal Governments**

Executive Order 13175, entitled "Consultation and Coordination with
Indian Tribal Governments" (65 FR 67249, November 9, 2000), requires EPA
to develop an accountable process to ensure "meaningful and timely input
by tribal officials in the development of regulatory policies that have
tribal implications." This final rule does not have tribal implications,
as specified in Executive Order 13175. This final rule does not
significantly or uniquely affect the communities of Indian tribal
governments. The final rule does not impose any enforceable duties on
communities of Indian tribal governments. Thus, Executive Order 13175
does not apply to this final rule.

**G. Executive Order No. 13045: Protection of Children from
Environmental Health and Safety Risks**

Executive Order 13045: ''Protection of Children from Environmental
Health Risks and Safety Risks'' (62 FR 19885, April 23, 1997) applies to
any rule that: (1) Is determined to be ''economically significant'' as
defined under Executive Order 12866, and (2) concerns an environmental
health or safety risk that EPA has reason to believe may have a
disproportionate effect on children. If the regulatory action meets both
criteria, the Agency must evaluate the environmental health or safety
effects of the planned rule on children, and explain why the planned
regulation is preferable to other potentially effective and reasonably
feasible alternatives considered by the Agency.

EPA interprets Executive Order 13045 as applying only to those
regulatory actions that are based on health or safety risks, such that
the analysis required under Section 5--501 of the Order has the
potential to influence the regulation. This final rule is not subject to
Executive Order 13045 because it does not establish an environmental
standard intended to mitigate health or safety risks.

**H. Executive Order 13211: Actions that Significantly Affect Energy
Supply, Distribution, or Use**

This final rule is not a "significant energy action" as defined in
Executive Order 13211, "Actions Concerning Regulations That
Significantly Affect Energy Supply, Distribution, or Use" (66 FR 28355
(May 22, 2001)) because it is not likely to have a significant adverse
effect on the supply, distribution, or use of energy. This final rule
does not pertain to any segment of the energy production economy nor
does it regulate any manner of energy use. Therefore, EPA has concluded
that this final rule is not likely to have any adverse energy effects.

**I. National Technology Transfer and Advancement Act**

Section 12(d) of the National Technology Transfer and Advancement Act of
1995 (\"NTTAA\"), Public Law No. 104-113, Section 12(d) (15 U.S.C. 272
note) directs EPA to use voluntary consensus standards in its regulatory
activities unless to do so would be inconsistent with applicable law or
otherwise impractical. Voluntary consensus standards are technical
standards (e.g., materials specifications, test methods, sampling
procedures, and business practices) that are developed or adopted by
voluntary consensus standards bodies. The NTTAA directs EPA to provide
Congress, through OMB, explanations when the Agency decides not to use
available and applicable voluntary consensus standards. This rulemaking
does not involve technical standards. Therefore, EPA is not considering
the use of any voluntary consensus standards.

**J. Executive Order 12898: Federal Actions to Address Environmental
Justice in Minority Populations and Low-Income Populations**

Executive Order (EO) 12898 (59 FR 7629 (Feb. 16, 1994)) establishes
federal executive policy on environmental justice. Its main provision
directs federal agencies, to the greatest extent practicable and
permitted by law, to make environmental justice part of their mission by
identifying and addressing, as appropriate, disproportionately high and
adverse human health or environmental effects of their programs,
policies, and activities on minority populations and low-income
populations in the United States.

EPA has determined that this final rule will not have disproportionately
high and adverse human health or environmental effects on minority or
low-income populations, because it affects the level of environmental
protection equally for all affected populations without having any
disproportionately high and adverse human health or environmental
effects on any population, including any minority or low-income
population. Any ozone depletion that results from this final rule will
impact all affected populations equally because ozone depletion is a
global environmental problem with environmental and human effects that
are, in general, equally distributed across geographical regions.

**K. Congressional Review Act**

The Congressional Review Act, 5 U.S.C. 801 et seq., as added by the
Small Business Regulatory Enforcement Fairness Act of 1996, generally
provides that before a rule may take effect, the agency promulgating the
rule must submit a rule report, which includes a copy of the rule, to
each House of the Congress and to the Comptroller General of the United
States. EPA will submit a report containing this rule and other required
information to the U.S. Senate, the U.S. House of Representatives, and
the Comptroller General of the United States prior to publication of the
rule in the Federal Register. A Major rule cannot take effect until 60
days after it is published in the Federal Register. This action not a
"major rule" as defined by 5 U.S.C. 804(2). This rule will be effective
\[Insert date of publication\].

[^1]: NPMA stands for National Pest Management Association.