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OAR Box 1819 

Prepped by Ollie Stewart 

Document Number: 

7) IV-D-11 

Docket Number: 

A-87-11 

Printed 11/10/2008 8:56:53 AM Sheet 7 of 348 
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A-87-JZ7. 

33.-1)-/ / 

EXECUTIVE OFFICE OF THE PRESIDENT 

OFFICE OF MANAGEMENT AND BUDGET 

WASHINGTON, D.C. 20503 

AUG 2 7 1987 

Honorable Lee Thomas 

Administrator 

Environmental Protection Agency 

401 M Street, S.W. 

Washington, D.C. 20460 

Dear Lee: 

The Environmental Protection Agency (EPA) has submitted to the 

Office of Management and Budget (OMB) for review under Executive 

Order No. 12291, a major draft proposed rule that would establish 

national standards limiting the refueling emissions'from cars and 

trucks. This draft proposal (the so-called "onboard" rule) 

would require automakers to install control equipment—including 

a charcoal charged vapor recovery canister and other control 

equipment—in all gasoline-fueled cars and trucks. EPA estimates 

that a 49-State onboard control program would impose costs of 

roughly $180 million per year. 

I have reviewed the draft proposal and have some major concerns 

about the consistency of this draft with the principles of 

Executive Order No. 12291. These include the following: 1) Are 

the resulting control costs of an onboard control system 

consistent with available estimates of the benefits of a 

reduction in ozone levels? And 2) What net cost (if any) does a 

nationwide onboard requirement impose on the two-thirds of the 

nation's population living in areas of the country that already 

meet the ozone National Ambient Air Quality Standards (NAAQS)? 

In addition, Section 206(a)(6) of the Clean Air Act requires a 

comparison of "the costs and effectiveness of such technology 

(onboard) to that of implementing and maintaining vapor recovery 

at the gas pump (so-called "Stage II" control). It is not clear 

to us, first of all, that either of these approaches yields 

cost-effective reductions in ozone-forming hydrocarbons and we 

Gasoline vapors are comprised of volatile organic compounds 

(VOCs) that are precursors in the formation of ozone. 

2 . • . 

Stage II control equipment recaptures refueling vapors with a 

sleeve on the gas pump nozzel and returns the vapors to the 

storage tank. 
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believe EPA needs to look at this issue further. EPA also 

needs to examine carefully the cumulative effects on its 

cost-effectiveness analysis of a number of important factors that 

EPA identified in its preamble discussion on the "sensitivity" of 

the analysis to alternative assumptions. For example, what are 

the combined effects on its cost-effectiveness calculations of 

alternative assumptions on 1) volatility limits, 2) secondary 

weight effects, and 3) projections of the number of nonattainment 

areas. 

Finally, we share the concern of the National Highway Traffic 

Safety Administration (NHTSA) that two years is not an adequate 

leadtime for manufacturers to design and test the onboard control 

system in order to assure the safety and integrity of their fuel 

systems. Automobile manufacturers must comply with a number of 

other safety requirements over the next several years. The 

additional burden of designing and testing an onboard control 

system that meets current NHTSA standards for fuel system 

integrity may further strain the ability of manufacturers to 

assure the safety of their vehicles. Given the serious 

consequences of fuel system failure, these concerns must be 

resolved before proceeding with a requirement for onboard control 

of refueling emissions. 

However, EPA's review of the need for control of refueling 

emissions has been under development for a long period of time. 

Given your request to proceed with the publication of this 

proposal, I believe the public deserves the opportunity to review 

and comment on it at this stage in the process and I concur with 

your request. At the same time, I understand that EPA has 

committed to reexamine the major issues associated with the 

control of refueling emissions after receiving comment on this 

proposal from the public and from the Department of 

Transportation. As stated in the preamble to the onboard 

proposal: 

...Because of the statutory significance attached to 

this consultation (with the Department of 

Transportation), EPA will reopen the record of this 

rulemaking when the Agency receives the comments from 

the Secretary of Transportation and will repropose the 

rule for comment to assess changed circumstances. This 

reproposal shall occur prior to final decision on the 

merits of the onboard regulation and sufficiently prior 

to the full commercial manufacture of vehicles with 

onboard technology to allow the public a meaningful 

opportunity to comment on whatever significant changes 

in circumstances may occur prior to full manufacture. 

We agree that EPA must address the basic questions raised during 

the course of our review—including the concern for the safety of 

the onboard control equipment, the number of nonattainment areas, 

and the effect of refueling emission control on the status of 

these areas—before proceeding with the development of a final 

rule that would limit refueling emissions. In its reproposal, 
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EPA should also address other issues raised during the course of 

public comment or resulting from new or additional information on 

the merits of limiting refueling emissions. 

We plan to submit a more detailed analysis of this draft proposal 

during the public comment period. As always, my staff and I are 

available for further discussion on this matter. 

Sincerely, 

ILJ7< 

endy L. Gramm 

Administrator for Information 

and Regulatory Affairs