United States Environmental Protection Agency, Region IX

Air Division

Technical Support Document

for

EPA's Notice of Proposed Rulemaking

for the 

California State Implementation Plan

Monterey Bay Unified Air Pollution Control District

Rule 200 – Permits Required

Rule 203 – Application

Rule 204 – Cancellation of Applications

Rule 206 – Standards for Granting Applications

Rule 207 – Review of New or Modified Sources

Rule 208 – Standards for Granting Permits to Operate (Request to Repeal)

Rule 212 – Public Availability of Emission Data

Laura Yannayon

Reviewed by Gerardo Rios

September 29, 2014
Table of Contents

Section Page

Introduction 1

SIP Revisions Submittals 1

Background 2

Rule Summaries 2

Rule 200 – Permits Required

Rule 203 – Application

Rule 204 – Cancellation of Applications

Rule 206 – Standards for Granting Applications

Rule 207 – Review of New or Modified Sources

Rule 208 – Standards for Granting Permits to Operate (Request to Repeal)

Rule 212 – Public Availability of Emission Data

Rule Revisions and Evaluation 4

Rule 200 – Permits Required

Rule 203 – Application

Rule 204 – Cancellation of Applications

Rule 206 – Standards for Granting Applications

Rule 207 – Review of New or Modified Sources

Rule 208 – Standards for Granting Permits to Operate (Request to Repeal)

Rule 212 – Public Availability of Emission Data

Permit Program Evaluations 10

Permit Requirements for Minor Sources

Permit Requirements for Major Sources in Attainment Areas

Permit Requirements for Major Sources in Nonattainment Areas

New Source Review Reforms 26

California Clean Air Act – New Source Review Program

NSR Reform Program Requirements

Impacts of Federal NSR Reforms on California NSR Permitting Programs

Section 110(l) of the Act 30

Section 193 of the Act 32

Recommendations 33

Attachments 35
1

Introduction

Part C of title I of the Clean Air Act (CAA or Act) contains the provisions for the Prevention of 

Significant Deterioration (PSD) of air quality program in areas designated as “attainment” or 

“unclassifiable” for the national ambient air quality standards (NAAQS). The requirements under 

part C apply to “major stationary sources” and “major modifications” as those terms are defined 

in 40 CFR Part 51.166. In addition to regulations for new and modified major stationary sources 

under part C, the CAA requires each state to include in its SIP a program to regulate the 

construction and modification of any stationary source as necessary to assure that the NAAQS 

are achieved. This program is commonly referred to as “minor new source review (minor NSR).” 

See 40 CFR 51.160-51.164.

The CAA defines “nonattainment areas” as air quality planning areas that exceed the primary or 

secondary NAAQS for the given criteria pollutant. The Monterey Bay Unified Air Pollution 

Control District (MBUAPCD or District) is not designated nonattainment for any NAAQS, 

although the District was classified as nonattainment in the past. Because the MBUAPCD is not 

currently classified nonattainment for any NAAQS, we are not evaluating the submitted rules for 

approval under 40 CFR 51.165, which contains the requirements for nonattainment NSR 

programs. To the extent some rules contain provisions typically associated with nonattainment 

NSR programs (e.g. offset provisions), we are approving those provisions only for purposes of 

the District’s minor NSR program.

SIP Revision Submittals

MBUAPCD submitted revised permit program related rules to comply with the federal PSD and 

minor NSR requirements. While the District may have submitted earlier versions of these rules, 

EPA is only acting on the most current versions of these rules, which were adopted or amended 

on the dates listed below in Table 1, and submitted to EPA via the California Air Resources 

Board (ARB) by a letter dated as indicated in the table. ARB is the governor’s designee for 

submitting official revisions of the California State Implementation Plan (SIP) to EPA. 

Table 1 –Submitted Rules

Rule # Rule Title

Adopted or 

Amended Submitted

200 Permits Required 12/13/00 5/8/01

203 Application 10/16/02 12/12/02

204 Cancellation of Applications 3/21/01 5/31/01

206 Standards for Granting Applications 3/21/01 5/31/01

207 Review of New or Modified Sources 4/20/11 5/12/11

208

Standards for Granting Permits to Operate 

(Request to Repeal) 12/13/00 5/8/01

212 Public Availability of Emission Data 10/16/02 12/12/02
2

Background

Table 2 provides a list of the current SIP approved versions of the rules being evaluated by EPA.

Table 2 –SIP Approved Rules1

Rule # Rule Title

SIP 

Approval

Date

Federal 

Register 

Citation

200 Permits Required 7/1/99 64 FR 35577

204 Cancellation of Applications 7/1/99 64 FR 35577

206 Standards for Granting Applications 7/13/87 52 FR 26148

207 Review of New or Modified Sources 2/4/00 65 FR5433

208

Standards for Granting Permits to Operate 

(Request to Repeal) 7/13/87 52 FR 26148

212 Public Availability of Emission Data 7/13/87 52 FR 26148

Note 1: There is no current version of Rule 203 – Application, in the SIP.

MBUAPCD’s current SIP-approved PSD and minor NSR program is contained in the rules listed 

in Table 2 above, which were SIP-approved on the dates listed. The rules contain both the 

general and specific program requirements. 

In 2002, EPA promulgated changes to the NSR regulations for preparation, adoption, submittal 

and approval of implementation plans governing the NSR programs mandated by parts C and D 

of title I of the Act. These changes to the major NSR program, commonly referred to as “NSR 

Reform,” obligate States to develop and submit to EPA revised NSR regulations for 

nonattainment areas, as well as attainment areas for states that elect to implement the PSD 

program. EPA also promulgated two rules to implement the new NAAQS for PM2.5, known as 

the NSR PM2.5 Implementation Rule (73 FR 28321, May 16, 2008) and the PM2.5 PSD 

Increments – Significant Impact Levels (SILs) – Significant Monitoring Concentration (SMC) 

Rule (75 FR 64864, October 20, 2010). In response to these new program requirements, 

MBUAPCD has submitted revised Rule 207. This TSD contains EPA’s evaluation for the rules

listed in Table 1.

Rule Summaries

Rule 200 – Permits Required

Rule 200 is comprised of four parts: Part 1 – General, Part 2 – Definitions, Part 3 –

Requirements, and Part 4 – Administrative Requirements. Part 1 includes provisions that outline 

the purpose and applicability of the rule, as well as exemptions from all or portions of the rule, 

the effective date and a list of references. Part 2 is reserved. Part 3 contains the requirement to 

obtain an Authority to Construct and Permit to Operate, as well as provisions regarding the 

review, posting and alteration of such permit. This section also includes a provision regarding the 

use of control equipment and a prohibition for violating any term or condition of an Authority to 
3

Construct, and Permit to Operate. Part 4 contains a single provision clarifying which permit 

terms and conditions are federally enforceable.

Rule 203 – Application

Rule 203 is comprised of three parts: Part 1 – General, Part 2 – Definitions, and Part 3 –

Requirements. Part 1 includes provisions that outline the purpose and applicability of the rule, 

the effective date and a list of references. Part 2 is reserved. Part 3contains the requirements for 

submitting an application for an Authority to Construct or Permit to Operate and requires a 

separate permit for each permit unit.

Rule 204 – Cancellation of Applications

Rule 204 is comprised of three parts: Part 1 – General, Part 2 – Definitions, and Part 3 –

Requirements. Part 1 includes provisions that outline the purpose and applicability of the rule, 

the effective date and a list of references. Part 2 is reserved. Part 3contains the requirements for 

when an Authority to Construct is automatically cancelled, and when and how it may be 

extended. 

Rule 206 – Standards for Granting Applications

Rule 206 is comprised of four parts: Part 1 – General, Part 2 – Definitions, Part 3 –

Requirements, and Part 4 – Administrative Requirements. Part 1 includes provisions that outline 

the purpose and applicability of the rule, the effective date and a list of references. Part 2 is 

reserved. Part 3contains the requirements and criteria for issuing an Authority to Construct and a 

Permit to Operate. It also contains a provision allowing the District to require sampling and 

testing facilities as necessary and specifies that a permit holder is not exempt from existing and 

future regulations of the air district. Part 4 contains a provision requiring the District to evaluate 

the project for compliance with this rule prior to taking a final action.

Rule 207 – Review of New or Modified Sources

Rule 207 is comprised of ten parts: Part 1 – General, Part 2 – Definitions, Part 3 – General 

Requirements, Part 4 – Federal Clean Air Act Requirements, Part 5 – California Clean Air Act 

Requirements, Part 6 – Administrative Requirements, Part 7 – Calculations, Part 8 – Power 

Plants, Part 9 – Source Impact Analysis, and Part 10 – Federal Enforceability, SIP Revisions. 

Part 1 includes provisions that outline the purpose and applicability of the rule and specifies

exemptions from all or portions of the rule, the effective date, a list of references, and when a 

permit must be denied. Part 2 contains 65 definitions. Part 3 contains requirements pertaining to 

air monitoring, visibility, soils and vegetation analysis, and air quality increments. This part also 

contains a prohibition on the use of mandated reductions, requirements for emission reductions 

from shutdowns and curtailments and requirements for the use of interpollutant offsets. Part 4 

contains requirements for carrying out the federal CAA PSD and minor NSR programs, 

including existing BACT and offset requirements, as well as provisions for protection of Class I 

areas. EPA notes that some provisions in this Part, such as offset requirements, are no longer 

required nonattainment NSR program elements because the District is now classified attainment 

for all NAAQS and we are only approving those elements as part of the District’s minor NSR 

rule. Part 5 contains requirements to carry out the California Clean Air Act, including California 

BACT and State offset requirements, as well as provisions for California stationary source 
4

calculations. Pursuant to the provision in Section 10.5 which reads: “Part 5 of this Rule is not

submitted as a SIP revision”, EPA is not acting on any provisions included in Part 5 of the rule.

Part 6 contains certain administrative requirements, such as applicant requirements for evaluating 

alternative siting, providing a complete application, obtaining a plantwide applicability limit, and 

additional requirements for sources proposing to locate near a Class I area. This part also 

contains provisions requiring the District to perform certain evaluations related to air quality 

increments and use certain air quality models. Part 6 also contains the public notice 

requirements, and requirements for the District to make certain evaluations regarding permit 

issuance and to take final action within 180 days of receipt of a complete application. Part 7 

provides the provisions for performing emission calculations. Part 8 contains specific provisions 

for applications for power plants that must be licensed by the California Energy Commission. 

Part 9 contains specific provisions regarding the evaluation of an air impact analysis and 

provides a screening tool that may be used if certain conditions are met. Part 10 contains specific 

provisions regarding the federal enforceability of Rule 207. Specially, it lists what provisions of 

Rule 207 are not included as part of the SIP submittal to EPA, meaning that these provisions will 

not be enforceable under the federal Clean Air Act. 

Rule 208 – Standards for Granting Permits to Operate (Request to Repeal)

This rule has been repealed locally as its requirements have been incorporated into Rule 207 –

Review of New or Modified Sources.

Rule 212 – Public Availability of Emission Data

Rule 212 is comprised of four parts: Part 1 – General, Part 2 – Definitions, Part 3 –

Requirements, and Part 4 – Administrative Requirements. Part 1 includes provisions that outline 

the purpose and applicability of the rule, exemptions, the effective date and a list of references. 

Part 2 contains three definitions. Part 3 specifies the requirements for making a public record 

request and provides a timeline for a District response. Part 4 specifies the timeline for the 

District to respond to a trade secret claim and what steps must be taken if such a claim is 

rejected.

Rule Revisions and Evaluation

Rule 200 – Permits Required

The District’s staff report states that the main reason for revising the rule is to update it to be 

consistent with the District’s current rule format and make minor clarifications for ease of

reading. All of the language in Part 1 is new to the rule. This new language can be considered 

administrative in nature in that it does not impose any requirements on an applicant or the 

District. Instead it provides clarifying information, such as when the rule requirements apply, 

where exemptions to these requirements can be found, the effective date of the rule, and a 

summary describing from where the rule requirements arise.

The provisions in Part 3 – Requirements, contain several small clarifying edits that do not change 

any rule requirement. Part 3.1 contains a new paragraph stating that an Authority to Construct 
5

allows for temporary operation as needed to verify compliance, until issuance of the Permit to 

Operate; and that such temporary operation must be in compliance with all District rules and 

conditions of the Authority to Construct.

Part 4 – Administrative Requirements has been added to the rule and contains a single provision 

stating that only permit conditions derived from federal requirements imposed by the federal 

CAA or EPA regulations shall be federally enforceable.

Except for the new provision in Part 4 of the rule, the new language and minor edits to the rule 

provide additional clarity and enforceability and are therefore acceptable revisions. The new 

language in Part 4 conflicts with the provisions of 40 CFR 52.23 which provides that all permit 

conditions issued under an EPA-approved permit program which are incorporated into the State 

implementation plan, are federally enforceable conditions subject to enforcement under section 

113 of the CAA. Thus the default enforcement status of permit conditions issued as part of a 

federally approved permit program is that they are federally enforceable, regardless of the origin 

of the authority for the conditions. Because the new language in Part 4 explicitly contravenes the 

provisions contained in 40 CFR 52.23, the revisions to Rule 200 cannot be approved into the 

SIP. Therefore EPA is proposing to disapprove submitted Rule 200 – Permits Required. The 

version of Rule 200 that is currently approved into the SIP (64 FR 35577 July 1, 1999), will 

remain in effect.

Rule 203 – Application

The District’s staff report states that the main reason for revising the rule is to update it to be 

consistent with the District’s current rule format and make minor clarifications for ease of 

reading. All of the language in Part 1 is new to the rule. This new language can be considered 

administrative in nature in that it does not impose any requirements on an applicant or the 

District. Instead it provides clarifying information, such as when the rule requirements apply, 

where exemptions to these requirements can be found, the effective date of the rule, and a 

summary describing from where the rule requirements arise. The minor editorial revisions made 

to Part 3 – Requirements, are clarifying in nature. The new language and minor edits to the rule 

provide additional clarity and enforceability and are therefore acceptable revisions.

Rule 204 – Cancellation of Applications

The District’s staff report states that the main reason for revising the rule is to update it to be 

consistent with the District’s current rule format and make minor clarifications for ease of 

reading. All of the language in Part 1 is new to the rule. This new language can be considered 

administrative in nature in that it does not impose any requirements on an applicant or the 

District. Instead it provides clarifying information, such as when the rule requirements apply, 

where exemptions to these requirements can be found, the effective date of the rule, and a 

summary describing from where the rule requirements arise. The minor revisions made to Part 3 

– Requirements, are clarifying in nature. The new language and minor edits to the rule provide 

additional clarity and enforceability and are therefore acceptable revisions.

Rule 206 – Standards for Granting Applications

The District’s staff report states that the main reason for revising the rule is to update it to be 

consistent with the District’s current rule format and make minor clarifications for ease of 
6

reading. All of the language in Part 1 is new to the rule. This new language can be considered 

administrative in nature in that it does not impose any requirements on an applicant or the 

District. Instead it provides clarifying information, such as when the rule requirements apply, 

where exemptions to these requirements can be found, the effective date of the rule and a 

summary describing from where the rule requirements arise. Language has been added to Part 3 

to more clearly specify the criteria for issuing a Permit to Operate. The District must deny a final 

permit unless the District determines the source has been constructed in accordance with the 

conditions of the Authority to Construct, ensure any offsets required will commence at the time 

of or prior to initial operation of the new or modified source, and also provides that if the new 

source is a replacement source, that a maximum of 90 days may be allowed for simultaneous 

operation of the existing and new source. Several minor revisions have also been made to Part 3 

for clarity. The new language in Part 4 requires the District to verify compliance with this rule 

prior to issuing any final permits. The new language, evaluation criteria and minor revisions are 

clarifying in nature and are generally consistent with the requirements of 40 CFR Part 51 Subpart 

I. Therefore, these revisions are acceptable.

Rule 207 – Review of New or Modified Sources

Rule 207 is comprised of ten parts: Part 1 – General, Part 2 – Definitions, Part 3 – General 

Requirements, Part 4 – Federal Clean Air Act Requirements, Part 5 – California Clean Air Act 

Requirements, Part 6 – Administrative Requirements, Part 7 – Calculations, Part 8 – Power 

Plants, Part 9 – Source Impact Analysis, and Part 10 – Federal Enforceability, SIP Revisions. 

Rule 207 has been revised 4 times since it was last SIP approved. Compared to the current SIP 

approved version (approved in 2000), the following changes have been made.

In Part 1, Section 1.3.3 was added to provide an exemption from the requirements of Sections 4.2 

and 5.3 (offset requirements for the state and minor NSR programs), for Emergency Internal 

Combustion Engines that meet specific listed requirements. Subsection 1.3.2.1 was revised to 

provide an exemption from the requirements of Sections 4.2 and 5.3 (offset requirements for the 

state and minor NSR programs), for control equipment required to comply with any District, 

state or federal emission limit, if the resulting increase is less than the thresholds for a federal 

major modification. Section 1.3.4 was added to provide an exemption from the requirements of 

Sections 3.2 (Visibility, Soils, and Vegetation Analysis), 4.2 (Federal Offsetting Requirements), 

5.3 (State Offsetting Requirements), and 6.6 (Air Quality Increment Analysis) for Stationary 

Sources that have emissions of less than 10 tons/year of all individual criteria pollutants. Section 

1.3.5 was added to provide an exemption from the requirements of Sections 1.6.2 (Statewide 

Compliance Certification) and 6.1 (Alternative Siting) if the modification is not a federal Major 

Modification. Other minor clarifying edits were also made.

The new exemptions based on the project not resulting in a federal major modification (as 

defined in the rule) (see Sections1.3.2.1 and 1.3.5) or having emissions of less than 10 tpy of any 

criteria pollutant (see Sections 1.3.4) are acceptable because the exempted provisions are not 

required for sources that are not federal major sources and/or major modifications. EPA’s NSR 

review regulations do not provide any specific relief from offset requirements for Emergency 

Internal Combustion Engines that require a permit and would result in a new major source or 

major modification. However, at this time, the MBUAPCD is classified attainment for all criteria 
7

pollutants, and therefore is not required to provide any offsets as part of their federal permitting 

program. Therefore, at this time, we find the addition of Section 1.3.3 acceptable.

In Part 2, the definition of Best Available Control Technology (BACT) was revised to remove 

the language that implemented the definition of federal LAER (Lowest Achievable Emission 

Rate) as defined in 40 CFR 51.165. Additional language was also revised to make the definition 

consistent with the California CAA’s definition of this term. These revisions are acceptable 

because the MBUAPCD is classified attainment for all criteria pollutants, and therefore its

permitting program is not required to implement federal LAER. If the District becomes classified 

non-attainment for any criteria pollutant, pursuant to Section 107 of the CAA, then Rule 207 will 

need to be revised to require the application of LAER for major sources.

A new definition was added for the term Federal Major Modification. The term is defined the 

same as the term Major Modification found in 40 CFR 51.165, which is the same as the term is 

defined in 40 CFR 51.166. The new provision also provides specific definitions for the terms 

“reviewing authority” and “significant”, as used in the definition of Major Modification. The 

District has added this term to provide a definition for determining if a project will result in a 

major modification as defined in 51.165 to allow the use of new NSR Reform provisions which 

were added to the underlying federal NSR regulations in 2002. The District is not currently 

required to maintain a nonattainment NSR program in its SIP, therefore this provision is 

approvable.

The definition of Affected Pollutant, in Section 2.1 was revised to (1) add PM2.5 and (2) change 

the term “total suspended particulates” (TSP) to “particulate matter” (PM). While PM2.5 was 

already included in the definition of this term under Subsection 2.1.1, which applies to all 

pollutants for which an ambient air quality standard has been established, the revisions provide 

additional clarification by specifically listing these pollutants under Subsection 2.1.4. The 

definition of Affected Pollutant was also revised to remove ethylene, vinyl chloride, asbestos, 

beryllium and mercury. These revisions are consistent with the changes EPA has made to the 

definition of regulated NSR pollutants, in that all of these pollutants are regulated under section 

112 of the CAA and are not pollutants for which there is a NAAQS. Therefore these pollutants 

no longer meet the definition of a regulated NSR pollutant and we find that the revisions made to 

the definition of Affected Pollutant are acceptable.

The definition of Air Quality Increment has been revised in Subsection 2.5.1 to provide the 

appropriate baseline date for PM2.5. Subsection 2.5.2 has also been revised to add the appropriate 

increments for PM2.5 emissions. These revisions are consistent with the provisions of 40 CFR 

51.166 and are therefore acceptable. 

The definition of Net Emission Increase has been revised in Subsection 2.36.2 to include a 

specific provision for PM2.5. This provision is consistent with the definition of this same term in 

40 CFR 51.166, therefore this revision is acceptable. 

New definitions for Particulate Matter (PM) and Particulate Matter 2.5 (PM2.5) have been added 

as Sections 2.46 and 2.47, respectively. In addition, the term Total Suspended Particulates (TSP) 

has been deleted because it has been replaced by the term PM. These new definitions are 
8

consistent with EPA’s definitions for these terms, as found in 40 CFR 51.100, therefore these 

revisions are acceptable. In addition, in various definitions and other places throughout the rule, 

the term “TSP” has been replaced with either PM, PM10 and/or PM2.5, as appropriate. EPA finds 

all of these revisions acceptable as they provide additional clarity to the rule and its

requirements.

The definition of Precursor has been revised in Subsection 2.51.2 and 2.51.3, to specify that NOx

and SOx, are PM2.5 precursors. This is consistent with EPA’s definition of the term “regulated 

NSR pollutant” in 40 CFR 51.166, therefore we find these revisions acceptable.

No revisions from the SIP approved version of Rule 207, Part 3 have been made. 

In Part 4, the requirements of Section 4.1 – Best Available Control Technology (BACT) 

Requirements have been revised by amending the Table 4.1.1 Emission Thresholds for BACT to 

add PM2.5 as a pollutant and a corresponding threshold of 54.79 lbs/day (10 tpy). The following 

pollutants were deleted from the table, since they no longer meet the 40 CFR 51.166 definition of 

regulated NSR pollutant: vinyl chloride, asbestos, beryllium and mercury. In addition, 

Subsection 4.1.12 was revised to require modifications resulting in PM2.5 emission increases 

greater than the values specified in Table 4.1.1, to also require the application of BACT. These 

revisions are consistent with or more stringent than the requirements of 40 CFR 51.166, and are 

therefore approvable. 

A new provision was added to the requirements of Section 4.5 – Protection of Class I Areas to 

require any new or modified source to comply with Rule 207 if the source will result in a net 

increase of PM2.5 emissions greater than zero pounds per day and be constructed in an Area A

(i.e., Class I area) or an Area A Impact Zone (i.e., an area that impacts or is within 15 miles of a 

Class I area), as defined in Part 2. This provision is more stringent than the requirement of 40 

CFR 51.166(b)(23)(iii), which specifies that any new or modified source, located within 10 km 

of a Class I area, with an air quality impact equal to or greater than 1 μg/m3(24-hour average), is 

a significant increase, thus triggering the requirement to obtain a PSD permit. Because the new 

provision is at least as stringent as the applicable federal requirements, we find this new 

provision acceptable. 

No revisions from the SIP approved version of Rule 207, Part 5 have been made. 

In Part 6, new Section 6.3 has been added to allow sources to obtain Plantwide Applicability 

Limits (PAL), which will allow a source to avoid the otherwise applicable requirements of 

Sections 1.6.2 (Statewide Compliance) and Section 6.1 (Alternative Siting). Under the 

requirements of 40 CFR 51.165, these two requirements are only applicable if a project would 

result in a major modification in a nonattainment area. Sources with PALs that maintain actual 

emissions below their PAL are not subject to major modification requirements. Therefore EPA 

finds this revision acceptable.

Language is also included in Section 6.3 which requires the APCO to grant a PAL if the source 

demonstrates that the PAL conforms with the provisions of 40 CFR 51.165(f)(1) through (15).

EPA notes that while the CFR citation references the PAL requirements for a nonattainment 

NSR program, the PAL requirements for the PSD program at 40 CFR 51.166(w)(1) – (15) are 
9

essentially the same, with the 51.165 provisions containing a few additional requirements for 

nonattainment areas (e.g., 40 CFR 51.165(f)(1)(ii) prohibits the issuance of a PAL in an extreme 

ozone nonattainment area). Therefore EPA finds this revision acceptable.

Section 6.8 – Air Quality Models, has been revised to refer specifically to Appendix W of 40 

CFR part 51, rather than the most recent version of EPA’s guidance entitled “Guidelines on Air 

Quality Models.” This revision is consistent with the language contained in 40 CFR 51.166. 

Therefore EPA finds the revision acceptable. 

In Part 7, Subsection 7.4.2 has been revised to add the baseline date of October 20, 2010 for 

PM2.5. The revision is consistent with EPA’s revisions to 40 CFR 51.166(b)(14)(i)(c). Therefore 

EPA finds the revision acceptable.

No revisions have been made to the SIP approved version of Rule 207, Parts 8, 9 and 10. EPA 

notes that Part 10 provides instruction on which provisions in Rule 207 are not to be submitted to 

EPA for SIP approval and which specific provisions are revised for purposes of the SIP 

submittal. While Rule 207 was not submitted with any specific provisions struck out or removed 

from the rule, we interpret the language to mean that the cited rule provisions are not included in 

the SIP submittal. 

Rule 208 – Standards for Granting Permits to Operate (Request to Repeal)

The District has repealed this rule locally. The provisions contained in the rule were incorporated 

into Rule 207. EPA is proposing to approve the request to repeal this rule from the SIP because 

the provisions are now in Rule 207.

Rule 212 – Public Availability of Emission Data

The District’s staff report states that the main reason for revising the rule is to update it to be 

consistent with the District’s current rule format and make minor clarifications for ease of 

reading. All of the language in Part 1 is new to the rule. This new language can be considered 

administrative in nature in that it does not impose any requirements on an applicant or the 

District. Instead it provides clarifying information, such as when the rule requirements apply, the 

effective date of the rule and a summary describing from where the rule requirements arise. Part 

2, Definitions has been reformatted to provide the information of what constitutes a Public 

Record and Trade Secrets as definitions. Language has also been added to clarify that the written 

justification provided for claiming material is trade secret, is also a public record. A new 

definition for Stationary Source has been added, by referencing the definition of the same term in 

Rule 207. Section headers for Part 3 – Requirements and Part 4 – Administrative Requirements 

have been added, but the existing provisions have not been revised. EPA finds all of the revisions 

to this rule acceptable, because they do not conflict with any EPA regulations regarding Public 

Records. In addition, section 110(a)(2)(F) of the Act requires Districts to make periodic reports 

on the nature and amounts of emissions available for public inspection.
10

Permit Program Evaluations

For this Technical Support Document (TSD), EPA reviewed the submitted minor NSR and PSD 

rules for compliance with the CAA requirements for SIPs in general as set forth in CAA section 

110(a)(2), the requirements for stationary source preconstruction permitting programs in 40 CFR 

part 51, subpart I (Review of New Sources and Modifications), excluding section 51.165 which 

contains the nonattainment NSR program requirements, and the requirements related to SIP 

revisions in CAA sections 110(l) and 193. EPA also relied on the General Preamble for the 

Implementation of Title I of the Clean Air Act Amendments of 1990 (57 FR 13498, April 16, 

1992), the NSR PM2.5 Implementation Rule (73 FR 28321, May 16, 2008) and the PM2.5 PSD 

Increments – Significant Impact Levels (SILs) – Significant Monitoring Concentration (SMC) 

Rule (75 FR 64864, October 20, 2010) in the review of the District’s overall permitting 

regulations. EPA has condensed the approval criteria contained in these various materials in this 

TSD, which describes reasons for our proposed action on the SIP submittals for MBUAPCD.

Permit Requirements for Minor Sources

We reviewed the submitted rules for compliance with EPA’s regulations in 40 CFR 51, subpart I, 

excluding 40 CFR 51.165 and 51.166, which apply only to new major sources and major 

modifications under parts C and D of title I of the CAA. 

1. 40 CFR 51.160 – Legally enforceable procedures

(a) Each plan must set forth legally enforceable procedures that enable the State or local 

agency to determine whether the construction or modification of a facility, building, 

structure or installation or combination of these will result in (1) a violation of applicable 

portions of the control strategy; or (2) interference with attainment or maintenance of a 

national standard in the state in which the proposed source (or modification) is located or 

in a neighboring State.

Discussion: Rule 207 -- Review of New and Modified Sources, Section 1.6 requires the District to

deny issuance of an Authority to Construct (ATC) or Permit to Operate (PTO) unless the source is 

in compliance with all applicable rules and regulations. Section 3.3 prohibits the emissions from a 

new or modified stationary source from causing or contributing to the violation of an ambient air 

quality standard. Rule 203 – Application, Section 3.1 specifies the application requirements, 

including the requirement to provide all information necessary for the District to make 

determinations required by Rule 207. Taken together, these provisions are acceptable to satisfy 

this requirement.

(b) Such procedures must include means by which the State or local agency responsible 

for final decision-making on the application for approval to construct or modify will 

prevent such construction or modification if (1) it will result in a violation of applicable 

portions of the control strategy; or (2) it will interfere with the attainment or maintenance 

of a national standard.

Discussion: Rule 200 -- Permits, Part 3, prohibits construction and operation of any source unless 
11

an ATC and PTO has been obtained from the District. The District may grant such permits only 

after verifying the new project will comply with all applicable rules and regulations and will not 

interfere with attainment or maintenance of the NAAQS (See (a) above for summary of these 

requirements). These provisions are acceptable to satisfy this requirement.

(c) The procedures must provide for the submission, by the owner of operator of the 

building, facility, structure, or installation to be constructed or modified, of such 

information on (1) the nature and amounts of emissions to be emitted by it or emitted by 

associated mobile sources; (2) the location, design, construction, and operation of such 

facility, building, structure, or installation as may be necessary to permit the State or local 

agency to make the determination referred to in paragraph (a) of this section.

Discussion: Rule 200 – Permits, specifies the application requirements, including the requirement 

to submit application forms provided by the District and provide all information necessary for the 

District to make determinations required by Rule 207. The District’s application forms specify the 

information the District needs to make all of the determinations required by paragraph (a) of this 

section, and therefore this provision is acceptable to satisfy this requirement. 

(d) The procedures must provide that approval of any construction or modification must 

not affect the responsibility on the owner or operator to comply with applicable portions 

of the control strategy.

Discussion: Rule 206 – Standards for Issuing Authorities to Construct and Permits to Operate, 

Section 3.4 states “The issuance of an Authorities to Construct or Permits to Operate does not 

exempt the holder from existing and future regulations of the Air Pollution Control District.” This 

provision is acceptable to satisfy this requirement. 

(e) The procedures must identify types and sizes of facilities, buildings, structures, or 

installations which will be subject to review under this section. The plan must discuss the 

basis for determining which facilities will be subject to review.

Discussion: Rule 200 – Permits, Part 3, prohibits construction and operation of any source unless 

an Authority to Construct and Permit to Operate has been obtained from the District. Rule 201 –

Sources Not Requiring a Permit, which was last SIP approved by EPA on February 3, 1989, 

specifies that types and sizes of equipment and operations not required to obtain a permit pursuant 

to Rule 200. Taken together, these provisions are acceptable to satisfy this requirement.

(f) The procedures must discuss the air quality data and the dispersion or other air quality 

modeling used to meet the requirements of this subpart. (1) All applications of air quality 

modeling involved in this subpart shall be based on the applicable models, data bases, 

and other requirements specified in appendix W of this part (Guidelines on Air Quality 

Models). (2) Where an air quality model specified in appendix W of this part (Guideline 

on Air Quality Models) is inappropriate, the model may be modified or another model 

substituted. Such a modification or substitution of a model may be made on a case-bycase basis or, where appropriate, on a generic basis for a specific State program. Written 

approval of the EPA must be obtained for any modification or substitution. In addition, 
12

use of a modified or substituted model must be subject to notice and opportunity for 

public comment under procedures set forth in 40 CFR 51.102.

Discussion: Rule 207 -- Review of New and Modified Sources, Part 9, provides the requirements 

for analyzing air quality data. Specifically Section 9.1 allows for a screening method to be used to 

estimate the worst case air quality impact, if certain conditions are met. If these conditions are not 

met, then requirements of 40 CFR Part 51, Appendix W must be used. This language satisfies this 

requirement. 

40 CFR 51.160(f) allows a model to be substituted or modified if its use is inappropriate. Although 

District Rule 207 does not provide this option, it is not an approval issue. 

2. 40 CFR 51.161 – Public availability of information

(a) The legally enforceable procedures in 40 CFR 51.160 must also require the State or 

local agency to provide opportunity for public comment on information submitted by 

owners and operators. The public information must include the agency’s analysis of the 

effect of construction or modification on ambient air quality, including the agency’s 

proposed approval or disapproval.

Discussion: Rule 207 – Review of New and Modified Sources, Sections 6.9 and 6.10 address this 

requirement. Section 6.9 requires the District to provide an opportunity for public comment prior to 

issuing a permit for construction or modification. Section 6.10 specifies that the information shall be 

made available for public inspection at the District’s office. This includes the information provided 

by the applicant, the District’s analysis, including the District’s proposed permit action and a copy of 

the proposed permit. Section 6.9 is acceptable to satisfy the portion of the requirement regarding 

the type of information to be provided.

The requirement to provide a public notice is triggered at the following thresholds: 25 tpy for NOx

and VOC, 27.4 tpy for SOx and PM, 100 tpy for CO and 15 tpy for PM10. No threshold is specified 

for PM2.5. Public notice is also required if a source takes a voluntary emission limit. 

These public notice thresholds have been in place since 1993. The MBUAPCD became attainment 

for all NAAQS in 1997, and has continued to attain these standards, even as EPA has promulgated 

more stringent NAAQS. Therefore EPA agrees with the District that these thresholds provide a 

reasonable threshold for requiring public notice of minor sources. The thresholds in the rule are the 

same or lower than the PSD significance thresholds for all pollutants except PM2.5. Because there 

is not threshold for providing public notice for a PM2.5 increase, we are citing this as a rule 

deficiency and the District should correct the rule to provide an explicit public notice threshold for 

PM2.5 to address this deficiency. 

(b) For the purposes of paragraph (a) of this section, opportunity for public comment 

shall include, as a minimum, (1) Availability for public inspection in at least one location 

in the area affected of the information submitted by the owner or operator and of the State 

or local agency’s analysis of the effect on air quality; (2) A 30-day period for submittal of 

public comment; and (3) A notice by prominent advertisement in the area affected of the 
13

location of the source information and analysis specified in paragraph (b)(1) of this 

section. 

Discussion: Rule 207 – Review of New and Modified Sources, Sections 6.9 and 6.10 address this 

requirement. Section 6.9 requires the District to provide a 30-day public comment prior to issuing 

an ATC with a potential to emit greater than the thresholds provided in Table 4.1.1.. The notice 

requesting public comment must be published in at least one newspaper of general circulation and 

state how pertinent information can be obtained. Section 6.10 specifies that the information shall 

be made available for public inspection at the District’s office. This includes the information 

provided by the applicant, the District’s analysis, including the District’s proposed permit action and 

a copy of the proposed permit. These provisions are acceptable to satisfy this requirement.

(c) Where the 30-day comment period required in paragraph (b) of this section would 

conflict with existing requirements for acting on requests for permission to construct or 

modify, the State may submit for approval a comment period which is consistent with 

such existing requirements.

Discussion: This is a discretionary component of a permit program that MBUAPCD’s submitted 

regulations do not contain. All permits subject to public notice requirements under Rule 207 are 

subject to a 30-day public comment period. This is acceptable. 

(d) A copy of the notice required by paragraph (b) of this section must also be sent to the 

EPA through the appropriate Regional Office, and to all other State and local air 

pollution control agencies having jurisdiction in the region in which such new or 

modified installation will be located. The notice also must be sent to any other agency in 

the region having responsibility for implementing the procedures required under this 

subpart. For lead, a copy of the notice is required for all point sources. The definition of 

point source for lead is given in 40 CFR 51.100(k)(2).

Discussion: Subsection 6.10 requires the District to send a copy of the information submitted by the 

applicant, the District’s analysis and a copy of the proposed permit to ARB, EPA and any other 

interested public agency or party requesting it. This provision is acceptable to satisfy the first part 

of this requirement.

With respect to any “point source” of lead (i.e., any stationary source that actually emits a total of 5 

tpy or more, see 40 CFR 51.100(k)), the requirement is not met. EPA is identifying the absence of 

such a provision as a deficiency and proposing to disapprove Rule 207 with respect to this 

requirement. This limited disapproval, if finalized, would require the District to revise Rule 207 to 

include a provision meeting the requirement in 40 CFR 51.161(d) and to submit the revised rule to 

EPA for approval into the MBUAPCD portion of the California SIP.

3. 40 CFR 51.162 – Identification of responsible agency

Each plan must identify the State or local agency which will be responsible for meeting 

the requirements of this subpart in each area of the State. Where such responsibility rests 

with an agency other than an air pollution control agency, such agency will consult with 
14

the appropriate State or local air pollution control agency in carrying out the provisions of 

this subpart.

Discussion: California law provides for the creation and authority of each air District. (See H&SC 

Division 26, Part 3.) California law specifically provides that “Local and regional authorities [e.g., 

the Districts] have the primary responsibility for control of air pollution from all sources other than 

vehicular sources.” (See CH&SC § 39002.) Accordingly, the California SIP has been divided into 

sections for each of the 35 state permitting authorities. Each District that adopts rules and 

regulations and submits them for SIP approval is responsible for implementing and enforcing those 

submitted rules. For the rules under review, all of the rules were adopted and submitted by the 

MBUAPCD.

4. 40 CFR 51.163 – Administrative procedures

The plan must include the administrative procedures, which will be followed in making 

the determination specified in paragraph (a) of 40 CFR 51.160.

Discussion: Rule 203 – Application, Section 3.1 requires applications for both ATCs and PTOs to 

be filed in the manner and form prescribed by the District, and requires the applicant to provide all 

of the information necessary to enable the District to make the determinations required by Rules 

206 and 207. This provision satisfies this requirement. 

5. 40 CFR 51.164 – Stack height procedures

Such procedures must provide that the degree of emission limitation required of any 

source for control of any air pollutant must not be affected by so much of any source’s 

stack height that exceeds good engineering practice or by any other dispersion technique, 

except as provided in 40 CFR 51.118(b). Such procedures must provide that before a 

State issues a permit to a source based on a good engineering practice stack height that 

exceeds the height allowed by 40 CFR 51.100(ii)(1) or (2), the State must notify the 

public of the availability of the demonstration study and must provide opportunity for 

public hearing on it. This section does not require such procedures to restrict in any 

manner the actual stack height of any source.

Discussion: Rule 207, Section 6.8 states that “Credit shall not be given for stacks higher than that 

dictated by good engineer practice.” This provision is sufficient to ensure that the air quality 

impacts of stationary sources are not underestimated due to stack heights that exceed good 

engineering practice or air dispersion modeling techniques that do not satisfy the criteria of set 

forth in 40 CFR 51.118(b). 

Permit Requirements for Major Sources in Attainment Areas

EPA offers States (and local air districts) two mechanisms by which to administer permitting 

programs for the prevention of significant deterioration (PSD) of air quality, established by 

Congress in part C of title I of the Act. First, where EPA has promulgated the Federal PSD 

program under 40 CFR 52.21, EPA may delegate that permitting authority to a State or air 

district. Alternatively, a State or air district may develop its own PSD program meeting the 
15

requirements of 40 CFR 51.166, and submit these rules for inclusion in the applicable SIP. 

Sources under MBUAPCD jurisdiction have been subject to a SIP-approved PSD program since 

July 11, 1996 (61 FR 36501). We discuss below the criteria for approval of a State/local PSD 

permitting program and our evaluation of MBUAPCD’s PSD SIP submittal in accordance with 

these requirements.

1. Provisions, pursuant to 40 CFR 51.166(a)(7), which incorporate the requirements in 40 

CFR 51.166(a)(7)(i) through (a)(7)(vi) regarding applicability of PSD program 

requirements. 

a. 40 CFR 51.166(a)(7)(i) specifies that the PSD program must apply to the construction 

of any new major stationary source or any project at an existing major stationary 

source in areas designated attainment or unclassifiable.

Discussion: Rule 207, Section 1.2, Applicability, states that the rule applies to all new 

stationary sources and all modifications to existing stationary sources which, after construction 

or modification, emit or have the potential to emit any affected pollutants. While the rule applies 

to sources emitting any affected pollutants, the key PSD program requirements, including 

BACT, an Air Quality Impact Analysis (AQIA), a Visibility, Soils, and Vegetation Analysis and 

an Increment analysis are all triggered at emission rates equivalent to or lower than the 

significant emission rates specified in 40 CFR 51.166. Taken together, Rule 207 requires the 

PSD program elements to be applied to all new major sources and major modifications. These

provisions satisfy this requirement. 

b. 40 CFR 51.166(a)(7)(ii) specifies that the PSD program must apply the requirements 

of 40 CFR 51.166 (j) through (r) to the construction of any new major stationary 

source or the major modification of any existing major stationary source. 

Discussion: We evaluate the requirements of paragraphs (j) through (r), individually below. 

c. 40 CFR 51.166(a)(7)(iii) specifies that the PSD program must prohibit the 

construction of a new major stationary source or major modification to which the 

requirements of paragraphs (j) through (r)(5) apply, without a permit ensuring 

compliance with those requirements.

Discussion: Rule 207, Section 1.6, Permit Denial, states that a permit shall be denied unless 

the new or modified source complies with all applicable rules and regulations. This provision 

satisfies this requirement.

d. 40 CFR 51.166(a)(7)(iv) specifies that the PSD program must use the specific 

provisions contained in paragraphs (a)(7)(iv)(a) through (f) to determine emission 

increases, unless the State demonstrates that the submitted provisions are at least as 

stringent in all respects.

Discussion: Rule 207 does not include provisions that match those found in paragraphs 

(a)(7)(iv)(a) through (f). However EPA has determined that Rule 207 provides provisions that 
16

are at least as stringent (e.g., PSD program requirements such as BACT are triggered at lower 

emission thresholds). See the Section of this TSD titled New Source Review Reforms for 

additional information.

e. 40 CFR 51.166(a)(7)( v) specifies that a PSD program must contain provisions 

requiring a source seeking a PAL for a regulated NSR pollutant to comply with the 

requirements of 40 CFR 51.166(w).

Discussion: The District’s provisions pertaining to PALs are found in Rule 207, Section 6.3. It 

states that a PAL may only be issued if the PAL will conform with the provisions specified in 40 

CFR 51.165(f)(1) through (15). EPA notes that while the CFR citation references the PAL 

requirements for a nonattainment NSR program, the PAL requirements for the PSD program 

are essentially the same, with the 51.165 provisions containing a few additional requirements 

for nonattainment areas (e.g., 40 CFR 51.165(f)(1)(ii) prohibits the issuance of a PAL in an 

extreme ozone nonattainment area) that are not applicable to a PSD program. Therefore the 

provisions in Section 6.3 are sufficient to satisfy this requirement. 

2. Applicable definitions found in CAA sections 169 and 169A(g), and in 40 CFR 51.100 

and 51.166(b). EPA has reviewed the definitions in Rules 207 and 212. In most cases, 

these definitions are either identical or nearly identical to the definitions in the CAA and 

EPA’s implementing regulations. In some cases, however, the definitions do not track the 

language in the federal definitions as closely. We explain below in more detail our 

proposed determinations as to whether these definitions are equivalent to the federal 

definitions and, therefore, adequate to meet these requirements of a PSD program. 

a. Definitions That Differ From EPA Definitions in 40 CFR 51.166

Major Stationary Source

Discussion: The definition of this term provided in Section 2.32 of Rule 207 relies on a reference to 

the federal CAA to provide the annual emission rate thresholds for this definition. It reads in part 

“...which has the potential to emit greater than the threshold levels provided by the federal Clean 

Air Act (42 U.S.C. Section 7401 et seq.) for that designation.” This reference to the federal CAA is 

too vague to be enforceable as a practical matter. The lack of the specific major source thresholds, 

as provided in 40 CFR 51.166(b)(1) is a deficiency.

Major Modification

Discussion: Rule 207, Section 2.31, provides a similar definition for this term by defining the term 

“Major Modification to an Existing Source.” This definition uses the term “modification”, which is 

defined in Section 2.33 in a manner consistent with the definition provided in 40 CFR 51.166 

regarding the types of changes that constitute a major modification. The definitions differ however 

in two important ways.

First, the definition of this term relies on a reference to the federal CAA to provide the annual 

emission rate thresholds for this definition. It reads in part “...which has the potential to emit greater 

than the threshold levels provided by the federal Clean Air Act (42 U.S.C. Section 7401 et seq.) for 

that designation and pollutant.” This reference to the federal CAA is too vague to be enforceable as 
17

a practical matter. The lack of the specific major source thresholds, as provided in 40 CFR 

51.166(b)(1) is a deficiency.

Second, the definition in 40 CFR 51.166(b)(2) provides that a modification is “major” if it would 

result in a “significant emissions increase” and a “significant net emissions increase” of a pollutant, 

whereas the definition in Rule 207 provides that a modification is “major” if it may result in a 

“potential to emit” greater than the threshold levels provided by the federal CAA for the area

designation and pollutant. EPA reads this to mean that only increases above the existing potential 

to emit levels are considered emission increases when determining if a project will result in a major 

modification. This calculation methodology is inconsistent with the federal requirements which 

specify that emission increases from a modification be based on the difference between postproject projected actual or potential emissions and pre-project actual emissions (Actual to 

Projected or Potential test, see 40 CFR 51.166(a)(7)((iv)(c) and (d)). Using the Rule 207 definition, 

a project that would be considered a major modification under federal regulations, may not be 

considered a major modification at an existing source under Rule 207. Because the Rule 207 

definition results in an outcome that is not at least as stringent as required by 40 CFR 51.166’s 

definition of the term “significant”, we find this definition deficient.

We also note that the term “major modification at an existing source” is only used in Section 6.4 –

Proposed Sources in Federal Class I Areas. For all other rule requirements a New Emission 

Increase, as defined in Section 2.37 is based on the difference between the historic actual 

emissions and the modified source’s post-project potential to emit (see Section 7.4).

Potential to Emit

Discussion: While Rule 207 does not contain a specific definition for this term, Section 7.1 requires 

that the Potential to Emit of a new or modified source be calculated in a manner consistent with the 

definition provided in 40 CFR 51.166(b)(4). This provision is adequate to satisfy the requirement for 

this term to be defined. 

Regulated NSR Pollutant and Subject to Regulation

Discussion: Rule 207 does not contain definitions for either of these terms, but Section 2.1, 

provides a similar definition for Regulated NSR Pollutant by defining the term “Affected Pollutants.” 

Both definitions list pollutants (and their precursors) for which a NAAQS has been established. The 

definition of Regulated NSR Pollutant includes pollutants otherwise subject to regulation under the 

CAA as defined by the term “subject to regulation,” whereas Rule 207 includes all pollutants 

regulated by EPA or ARB, as well as pollutants for which either EPA or ARB has determined may 

have a significant adverse effect on the environment, the public health or the public welfare. Rule 

207 does not provide a definition for “subject to regulation” or any other provisions to clarify when 

pollutants are considered to be regulated by EPA or ARB.

The definition of the term “Affected Pollutant” in Rule 207 also differs from the definition of 

“Regulated NSR Pollutant” because it does not contain the exclusion language provided in 

paragraph 51.166(b)(49)(iv), which clarifies that hazardous air pollutants listed in section 112 of the 

CAA are not regulated NSR pollutants, unless the pollutant is also regulated as a general pollutant. 

Again, the lack of this exclusionary language means that for the purposes of Rule 207, all HAP 

pollutants which are regulated under section 112 of the CAA are also “affected pollutants,” subject 

to all applicable requirements of Rule 207. Overall, the Rule 207 definition of “affected pollutants” 

includes more pollutants that are included in the definition of “Regulated NSR Pollutant” and thus 
18

we find the definition satisfies the requirement to define these two terms. EPA suggests that the 

District update the definition of this term the next time Rule 207 is revised to include the important 

clarifications provided in the definition of the term “Regulated NSR Pollutant.”

Reviewing Authority

Discussion: Rule 207 defines the term “District” as the Monterey Bay Unified Air Pollution Control 

District (MBUAPCD) and its authorized representatives, which is the correct local air pollution 

control agency authorized to carry out a permit program under 40 CFR 51.166 for this area. EPA 

finds this substitute definition acceptable.

Project and Construction

Discussion: The Rule 207 definition of the term “Modification” is sufficiently equivalent to the 40 

CFR 51.166 definitions of these terms. EPA finds these substitute definitions acceptable.

Actual Emissions

Discussion: While Rule 207 does not contain a specific definition for this term, Section 7.2 requires 

that historical emissions be calculated based on actual operating conditions of the existing source 

averaged over three consecutive years immediately preceding the date of application. This 

requirement is consistent with the definition provided in 51.166(b)(21). Therefore this provision is 

adequate to satisfy the requirement for this term to be defined. 

Begin Actual Construction

Discussion: Rule 207 does not use or define the term “begin actual construction.” 40 CFR 

51.166(a)(7)(iii) specifies that no new major stationary source or major modification to which the 

rule provisions apply “shall begin actual construction without a permit...”. In turn, 51.166(b)(11) 

provides a definition of the term “Begin actual construction.” Rule 200, Section 3.1 states:

No person shall build, erect, alter, or replace any article, machine, equipment or other 

contrivance which may cause the issuance of air contaminants or the use of which may 

eliminate or reduce or control the issuance of air contaminants unless the facility owner or

operator has obtained a separate written Authority to Construct for each permit unit from 

the Air Pollution Control Officer.

Because the prohibition in Rule 200 prohibits all building until an ATC is issued, there is no need to 

provide a definition for “begin action construction.” Accordingly, EPA does not find the lack of a

definition for this term to be a deficiency.

Baseline Concentration

Discussion: While Rule 207 does not contain a specific definition for this term, the definition of “Air 

Quality Increment” in Section 2.5 includes language stating that the “Baseline air quality shall be 

the ambient concentration level reflecting actual air quality as monitored or modeled as of the 

existing baseline date....” The language within the definition of the term Air Quality Increment is 

adequate to satisfy the requirement for this term to be defined.
19

Major source baseline date and Minor source baseline date

Discussion: While Rule 207 does not contain a specific definition for these terms, the definition of 

“Air Quality Increment” in Section 2.5 lists specific dates for each pollutant which serve as the 

baseline for increment consumption by new and modified sources. The inclusion of the specific 

baseline dates, which are applicable based on the 40 CFR 51.166 definitions of these terms is 

acceptable to satisfy the requirement for these terms to be defined.

Significant

Discussion: While Rule 207 does not contain a specific definition for this term, Table 4.1.1 provides 

emission thresholds that are the same or lower for all listed pollutants and requires the emission 

increase to be calculated on an “Actual to Potential” basis.

1 The thresholds provided in Table 4.1.1 

serves the same purpose as the thresholds found in paragraph (i) of the 40 CFR 51.166(b)(23) 

definition of “significant”. Therefore we find that the thresholds provided in Table 4.1.1. are 

sufficient to satisfy the paragraph (i) definition.

The definition of “significant” contained 40 CFR 51.166(b)(23)(iii) reads “any emissions rate or any 

net emissions increase [NEI] associated with a major stationary source or major modification, 

which would construct within 10 kilometers of a Class I area, and have an impact on such area 

equal to or greater than 1 μg/m3(24-hour average).” Section 4.5, Protection of Class I Areas 

contains provisions similar to this definition in that it requires any new or modified stationary source

that results in a NEI greater than zero to be subject to the requirements of Rule 207 if it is located 

with 15 miles of a Class I area (identified in the rule as Area A) and has an increase in ambient 

pollutant concentration of the Area A by one microgram per cubic meter (24-hr basis) or a lesser 

amount depending on the pollutant. (Emphasis added) 

There are two issues with the provisions provided in Section 4.5. First it is not clear what “subject 

to the requirements” of Rule 207 means. This language requires additional clarification to ensure 

such sources are subject to all PSD program requirements, including BACT, an Air Quality Impact 

Analysis (AQIA), a Visibility, Soils, and Vegetation Analysis and an Increment analysis. Second, 

Rule 207 provides a significantly different definition of the term NEI than found in 51.166(b)(3). The 

key difference is that the definition provided in 51.166 only allows contemporaneous emission 

increases and decreases (typically occurring within the last 5 years) to be used in determining the 

NEI from a project, whereas the definition of NEI in Section 2.36 of requires the use of all emission 

increases and decreases since specified baseline dates for each pollutant. Except for PM2.5, these 

dates are between 20 and 30 years old. Because Rule 207 does not accurately define the term 

“Net Emissions Increase” and this term is necessary to accurately define the term “significant” as 

provided in 40 CFR 51.166(b)(23)(iii), we find this definition deficient.

EPA could not locate any provisions in Rule 207 or any other SIP approved rule that would satisfy 

the definition in paragraph (ii) contained in the 51.166 definition of significant. Paragraph (ii) 

specifies the definition of significant for any regulated NSR pollutant not listed in paragraph (i). The 

 

1 The threshold for PM is 27.4 tpy, which is slightly higher than the federal threshold of 25 tpy, but given that the 

threshold is specified in terms of pounds per day, EPA believes this shorter emission rate period provides a 

sufficiently equivalent threshold for PM and we therefore find it a minor deficiency that does not rise to the level of 

a disapproval issue.
20

lack of any provisions to satisfy the requirements of paragraph (ii) contained in the definition of 

“significant” is a deficiency.

Allowable emissions

Discussion: While Rule 207 does not contain a specific definition for this term, Section 7.1 –

Determination of the Potential to Emit provides that limitations on the operation of the source, if 

included in an ATC and PTO, may be used to determine the PTE from the new or modified source.

This provision essentially applies the definition of the term “allowable emissions.” This provision is 

acceptable to satisfy the requirement for this term to be defined.

Net emissions increase

Discussion: Rule 207 does not contain a specific definition for this term. The term is only used in 

Sections 4.2, Offset Requirement, General and 4.5, Protection of Class I Areas. EPA notes that in 

both cases, it is not used to determine if a modification will result in an emission increase that 

would trigger the PSD program requirements, including BACT, an Air Quality Impact Analysis 

(AQIA), a Visibility, Soils, and Vegetation Analysis and an Increment analysis. Because the 

MBUAPCD is currently not classified nonattainment for any NAAQS, EPA is not evaluating the rule 

for compliance with the provisions of 51.165, including how emission increases (including net 

emission increases) are calculated to determine if offsets are required. Because Rule 207 does not 

evaluate an emission increase on a “significant net emissions” basis (which would require 

calculations dependent on the definition of Net Emissions Increase), we find that the lack of a 

definition for this term is not a deficiency.

b. Terms not used or defined in Rule 207, but are defined in 40 CFR 51.166.

Discussion: Rule 207 does not contain any definitions for certain terms because they are not used 

in the rule. These definitions tend to relate to optional program provisions, such as the operation of 

a Clean Coal facility, modeling or monitoring terms that may be used elsewhere, but not in any 

specific 40 CFR 51.166 requirement. This includes definitions for the following terms: Clean coal 

technology, Clean coal technology demonstration project, Temporary clean coal technology 

demonstration project, Repowering, Reactivation of a very clean coal-fired electric utility steam 

generating unit, Pollution Prevention, High terrain, Low Terrain, Indian Reservation, Indian 

Governing Body, Continuous emissions monitoring system (CEMS), Predictive emissions 

monitoring system (PEMS), Continuous parameter monitoring system (CPMS), and Continuous 

emissions rate monitoring system (CERMS). EPA has reviewed each term and determined that 

since no provisions require the use of these specific terms, their absence from Rule 207 is 

acceptable.

Necessary preconstruction approvals or permits and Commence 

Discussion: While Rule 207 does not contain a specific definition for these terms, these terms are 

only used in the definition of “baseline concentration”. As discussed above, Rule 207 does not 

provide a definition for baseline concentration; therefore it is not necessary to provide a definition 

for these terms, as they are not used in Rule 207.

c. Terms not defined in Rule 207 – Used only by NSR Reform provisions
21

Discussion: As discussed below in the section of this TSD titled New Source Review Reforms, EPA 

has determined that the District is not required to include any provisions adopted by EPA in our 

“NSR Reform” rulemaking, dated December 31, 2002. Accordingly, definitions for the following 

terms, all related to NSR Reform provisions, are not required to be included in Rule 207: Emissions 

unit (all but first sentence), Projected Actual Emissions, Baseline Actual Emissions, and Electric 

utility steam generating unit.

d. Additional defined terms in Rule 207

Discussion: The following terms are defined in Rule 207 but are not specifically defined in EPA’s 

regulations in 40 CFR 51.100, 51.165 or 51.166. EPA has reviewed these terms and believes that 

they strengthen the program by providing clear definitions for terms used in Rule 207. 

These terms include the following: Air Basin, Air Pollution Control Officer, air Resources Board 

(ARB), Ambient Air Quality Standards, Authority to Construct, California Coastal Waters, 

Chloroflourocarbon (CFC), Cost Effective, District, District Board, Hydrochloroflourocarbon (HCFC),

Hydroflourocarbon (HFC), National Ambient Air Quality Standards (NAAQS), Net Air Quality 

Benefits, New Source Review (NSR), Nonattainment Pollutant, Permit to Operate, Prevention of 

Significant Deterioration (PSD), Seasonal Source, State Ambient Air Quality Standards, and State 

Implementation Plan (SIP). 

3. Provisions which establish the maximum allowable ambient air increments and ambient 

air ceilings as set forth in 40 CFR 51.166(c) and (d), for any designated attainment or 

unclassifiable area.

Discussion: Rule 207, Section 2.5 provide a definition for “air quality increment” and provides a 

table of the allowable air quality increments for all of the pollutants listed in 40 CFR 51.166(c) and 

(d). This provision is acceptable to satisfy this requirement.

4. Provisions concerning the initial designation of all attainment areas as Class I, II, or III, 

as listed in 40 CFR 51.166(e) and (g).

Discussion: Rule 207, Section 2.14 contains a definition for Class I area. It defines it as “any area 

... which has been designated Class I by a federal or state authority empowered to make such a 

decision.” This includes all areas designated as Class I by EPA pursuant to 40 CFR 51.166(e)(1). 

Rule 207 does not contain any definitions for the terms Class II or Class III, but all the applicable 

requirements listed in the rule are based on the area being designated Class II (e.g., Air Quality 

Increments, Significant Impact Levels). The inclusion of the applicable Class II provisions in the 

rule text, plus the definition of a Class I area, are sufficient to satisfy this requirement. 

5. Provisions, pursuant to 40 CFR 51.166(h), to assure that the degree of emission limitation 

required of any source for control of any air pollutant must not be affected by so much of 

any source's stack height that exceeds good engineering practice.
22

Discussion: Section 6.8, Air Quality Models, contains provisions concerning stack height and 

associated emission limitations. It states that “Credit shall not be given for stacks higher than that 

dictated by good engineering practice.” This provision satisfies the regulatory requirement.

6. Provisions, pursuant to 40 CFR 51.166(i), which allow for specified exemptions from the 

PSD program at the State’s election. 

Discussion: Rule 207 does not contain any of the specific exemptions allowable under 40 CFR 

51.166(i), but since these are optional exemptions, not including them is not a deficiency. Rule 207 

does contain several exemptions from Rule 207 requirements, but they are tailored to only apply to 

non-major sources, that are not subject to the requirements of 40 CFR 51.166. Therefore Rule 207 

satisfies with this optional provision.

7. Provisions, pursuant to 40 CFR 51.166(j), which require BACT, determined on a caseby-case basis, for a new major source or major modification.

Discussion: 40 CFR 51.166(b)(1) defines a major source as any facility included in the listed 28

source categories which have a potential to emit more than 100 tpy of any regulated NSR pollutant 

or any other facility emitting more than 250 tpy any regulated NSR pollutant. Thus BACT is 

required for all new sources that have a potential to emit either 100 or 250 tpy of each regulated 

NSR pollutant emitted, depending on the source category. 

40 CFR 51.166(b)(2) defines a major modification as a change that would result in both a 

significant emission increase and a significant net emission increase of any regulated NSR 

pollutant. 40 CFR 51.166(j)(3) specifies that if the project results in a major modification (for any 

one regulated NSR pollutant) then BACT must be applied for each NSR regulated pollutant that 

results in a significant net emission increase. The term Significant is then defined in 40 CFR 

51.166(b)(23) with a list of pollutants and emission rates. 

Rule 207, Section 4.1 requires BACT for all new or modified sources which have an emission 

increase for the listed pollutants, greater than the thresholds listed in Table 4.1.1 Emission 

Thresholds for BACT. The following table lists all the pollutants and thresholds provided in Table 

4.1.1., and the pollutants and significant emission rates specified in 40 CFR 51.166(b)(23). (Note 

values listed in Table 4.1.1 are all in units of pounds per day, but also shown here in units of tpy for 

convenience.) The thresholds for each pollutant listed in Table 4.1.1., except for PM, are the same 

or lower than the values listed in 40 CFR 51.166(b)(23). The threshold for PM is 27.4 tpy, which is 

slightly higher than the federal threshold of 25 tpy, but given that the threshold is specified in terms 

of pounds per day, EPA believes this shorter emission rate period provides a sufficiently equivalent 

threshold for PM and we therefore find it a minor deficiency that does not rise to the level of a 

disapproval issue. In addition, we note that the thresholds for PM10 and PM2.5 are at the same or 

lower thresholds than specified by 51.166.
23

Pollutant

40 CFR 51.66 

Emission 

Rates (tpy)

MB Emission 

Rates (lb/day)

MB Emission 

Rates (tpy)

Carbon monoxide

Nitrogen oxides (NOx)

Sulfur dioxide (SO2)

Particulate matter

PM10

PM2.5 (direct PM2.5 emissions) or

SO2 emissions or 

NOx emissions

Ozone:

Volatile organic compounds, or 

NOx emissions

Lead

Fluorides

Sulfuric acid mist

Hydrogen sulfide (H2S)

Total reduced sulfur (including H2S)

Reduced sulfur compounds (including 

H2S)

Municipal waste combustor organics

Municipal waste combustor metals

Municipal waste combustor acid gases 

Municipal solid waste landfill emissions

100

40

40

25

15

10

40

40

40

40

0.6

3

7

10

10

10

3.5 x 10-6

15

40

50

550

150

150

150

82

54.79

150

150

3.28

16.44

38.35

54.79

54.79

54.79

Not included

Not included

Not included

Not included

100.4

27.4

27.4

27.4

14.97

10

27.4

27.4

0.6

3

7

10

10

10

EPA notes that Table 4.1.1 does not provide any thresholds for emissions from municipal waste 

combustors and municipal solid waste landfill emissions. The state of California has adopted a 

state-wide ban on the construction of municipal waste combustors. Since such sources cannot be 

constructed in California, we do not find the lack of these thresholds to be a deficiency. For 

municipal solid waste landfills, emissions are to be measured as nonmethane organic compounds, 

which are essentially VOCs as defined in Rule 207 and the Table already provides a lower 

threshold of 27.4 tpy for VOCs. Therefore, Section 4.1 satisfies the regulatory requirement to 

require BACT be applied to all new major sources and all major modifications.

8. Provisions, pursuant to 40 CFR 51.166(k), which address the demonstration required 

from a source impact analysis. This includes showing that the allowable emission 

increases from the project and all other applicable emissions increases or reductions, 

would not cause or contribute to air pollution in violation of any NAAQS or any 

increment.

Discussion: Section 3.3, Ambient Air Quality Standards and Emission Increments addresses this 

provision. It provides that “In no case shall the emissions from the new or modified stationary 

source, or in conjunction with other increases in emissions, cause or contribute to the violation of 

an ambient air quality standard or exceed any air quality increment.” In addition, Section 6.6 Air 
24

Quality Increment Analysis, requires the District to evaluate the impact of the emission increases 

on the air quality increment. It specifies that the emissions from secondary source growth shall also 

be included in the determination of increment consumption. These provisions satisfy the regulatory 

requirement.

9. Provisions pursuant to 40 CFR 51.166(l) requiring air quality modeling consistent with 

the applicable requirements of appendix W of 40 CFR part 51 (“Guideline on Air Quality 

Models”), and provisions pursuant to 40 CFR 51.166(m) to assure that a major source or 

major modification will perform an air quality analysis, including pre-application air 

monitoring for any pollutant for which the net emissions increase of the source or 

modification is significant, and post-construction monitoring as necessary to determine 

the effect the emissions may have, or are having, on air quality in any area.

Discussion: .Section 6.8, Air Quality Models, requires that all air quality models used shall be 

consistent with the requirements specified in 40 CFR Part 51, Appendix W (“Guideline on Air 

Quality Models”), except where the District and EPA approve a modification or substitution to such 

a model following public comment period. Section 3.1, Pre-Construction and Post-Construction Air 

Monitoring, contains the requirement for an air quality analysis including pre-application and postconstruction monitoring requirements. These provisions satisfy the regulatory requirements. 

10. Provisions, pursuant to 40 CFR 51.166(n), requiring the submission of all information 

necessary to perform any analysis or make any determination required under the PSD 

program. 

Discussion: Rule 203, Section 3.1, Application, requires applications to be filed in the manner and 

from prescribed by the District and to provide all information necessary for the District to make the 

determinations required by Rule 207 – Review of New and Modified Sources. This provision 

satisfies this requirement.

11. Provisions, pursuant to 40 CFR 51.166(o), to assure that the owner of operator of a major 

source or major modification will perform additional impact analyses of the impairment 

to visibility, soils, and vegetation and the air quality impact projected for the area as a 

result of general commercial, residential, industrial and other growth associated with the 

source or modification.

Discussion: Section 3.2, Visibility, Soils, and Vegetation Analysis, includes the requirements

necessary to assure that the required additional impact analyses are performed. This provision 

satisfies this requirement.

12. Provisions to assure protection of air quality related values (including visibility) in Class 

I areas pursuant to 40 CFR 51.166(p).

Discussion: The requirements for protection of air quality related values (AQRV) (including 

visibility) are found in section 165(d)(2) of the Act, 40 CFR 51.166(p) and 40 CFR 51.307. These 

requirements include notification of a permit application to the Federal land manager (FLM) and the 

Federal official charged with direct responsibility for management of any lands within a Class I area 
25

which may be affected by emissions from a proposed major source or major modification. Also, the 

PSD program must provide a mechanism whereby an FLM or other Federal official may present to 

the permitting authority, after their preliminary determination, a demonstration that the emissions 

from the proposed source or modification would have an adverse impact on the AQRV (including 

visibility) of any Federal mandatory Class I lands, notwithstanding that the change in air quality 

resulting from emissions from such source or modification would not cause or contribute to 

concentrations which would exceed the maximum allowable increases for a Class I area. If the 

reviewing authority concurs with such demonstration, the reviewing authority must not issue the 

permit.

The Ventana Wilderness and Pinnacles National Monument, both Class I areas, lay within the 

boundaries of the MBUAPCD. Rule 207, Section 6.4, Proposed Sources in Federal Class I Areas,

requires the District to provide notice of any project whose emissions would affect a federal Class I 

area to the FLM for that area within 10 days of deeming the application complete. This provision 

also requires the District to provide a copy of the complete application and notify the FLM of any 

subsequent actions relating to the permit. Subsection 6.4.2 requires the District to accept and 

consider any comments provided by the FLM, and that if the FLM demonstrates that the emissions 

from the proposed project would have an adverse impact on the AQRV, and the District concurs, 

then the District shall deny the ATC. These provisions satisfy the regulatory requirement.

13. Provisions to assure agency and public participation under 40 CFR sections 51.166(p)(1) 

and 51.166(q).

Discussion: 40 CFR 51.166(p)(1) requires the PSD reviewing authority to transmit to EPA a copy of 

each permit application relating to a major new source or major modification and to provide notice 

to EPA of every action related to the consideration of such permit. 

Section 6.10 requires the District to provide EPA with the information submitted by the applicant, 

the District’s analysis and the proposed permit, no later than the time a public notice is published 

pursuant to Section 6.9. This provision provides for the necessary coordination with EPA. 

Discussion: 40 CFR 51.166(q) contains several provisions pertaining to public participation. These 

include a timeline for determining and notifying the source if their application is complete, taking 

action on the permit within one year of it being deemed complete, public notice requirements, 

notifying EPA and other interested parties of the proposal and providing opportunity for a public 

hearing. It also requires the permit authority to consider all of the written comments and make a 

final determination on the proposed permit, and notify the applicant of the final decision. 

Section 6.2, Complete Application, requires the District to determine if an application is complete 

within 30 days of receipt or after such longer time as both agree, and to notify the applicant in 

writing. Section 6.9 requires the District to publish a notice in at least one newspaper of general 

circulation stating the preliminary decision, how permit information may be obtained and inviting 

written public comments for a 30 day period follow the date of publication. Section 6.10 requires 

the District to provide ARB, EPA and any other interested party with the information submitted by 

the applicant, the District’s analysis and the proposed permit. Section 6.11, Authority to Construct, 

Final Action, requires the District to take a final action on the complete application within 180 days. 
26

Thus, Rule 207 contains all the necessary provisions, expect in regards to providing an opportunity 

for a public hearing, to satisfy the requirements of 40 CFR 51.166(q)(2)(iii). We find that Rule 207 

is deficient in that it does not include a requirement to provide the opportunity for a public hearing 

to consider a proposed permit action.

14. Provisions, pursuant to 40 CFR 51.166(r), which address source obligation requirements. 

Discussion: Rule 207 does not contain any provisions to satisfy the requirements of 40 CFR 

51.166(r), paragraphs (1) and (2). The lack of these provisions is a rule deficiency. Paragraphs 3-5 

are reserved, and thus do not contain any requirements that must be included in Rule 207.

Paragraphs 6 and 7 contain requirements pertaining to NSR reform provisions which EPA has 

determined are not applicable to Rule 207. Please see the TSD section entitled New Source 

Review Reforms for a further discussion of these requirements. 

Permit Requirements for Major Sources in Nonattainment Areas

Monterey Bay is currently designated attainment for all NAAQS, but designated nonattainment 

under state law for ozone and PM10. Accordingly, Rule 207 is not required to meet the federal 

nonattainment NSR program requirements for major sources pursuant to 40 CFR 51.165. Instead 

any requirements applicable under state law to a nonattainment pollutant are only evaluated for 

general clarity and enforceability. These include the provisions found in Section 4 as they apply 

to minor (i.e., non-major sources) and the provisions found in Section 5, which are not included 

in the SIP submittal.

New Source Review Reforms

California Clean Air Act – New Source Review Program

The air quality in California has historically been some of the worst in the nation. In light of this 

fact, California has always been at the forefront in implementing strict air quality regulations to 

address the state’s serious air quality problems.

In 1959, the State passed its first air quality standards for total suspended particulates, 

photochemical oxidants, sulfur dioxide, nitrogen dioxide, and carbon monoxide. These state 

standards were amended in 1969 by the Air Resources Board. At that time, the California 

ambient air quality standard for ozone was lower than the federal standard, thus most of 

California was exceeding the state standard for Ozone. As a result, most California Air Pollution 

control agencies developed permitting programs that contained non-attainment new source 

review requirements such as Lowest Achievable Emissions Rate (LAER) and offsets around the 

same time as the adoption of the federal Clean Air Act in 1970.

In 1988, California adopted the California Clean Air Act of 1988 (California CAA). This 

legislation established new preconstruction review requirements for new and modified sources. It 

established uniform emission thresholds that trigger control and offset requirements for ozone 

(VOC and NOx), carbon monoxide (CO), sulfur dioxide (SO2) and nitrogen dioxide (NO2) at 
27

levels significantly lower than the federal thresholds in effect at the time of adoption. These 

thresholds are even lower than the thresholds established two years later by the federal Clean Air 

Act Amendments of 1990 (federal CAA).

Under both state and federal requirements, all ozone nonattainment areas were classified 

according to the severity of the ozone violations measured for each area. Instead of a single 

major source threshold for all areas, the federal CAA set new major source and major 

modification thresholds of 100 and 40 tons per year (tpy) respectively, for areas classified as 

moderate or marginal; 50 and 25 tpy respectively, for areas classified as serious; 25 and 25 tpy 

respectively, for areas classified as severe; and 10 and 0 tpy respectively, for areas classified as 

extreme. These thresholds are used to determine when a proposed project requires the application 

of LAER and emission offsets.

In comparison, the California CAA set thresholds for when project emissions trigger the 

application of the California version of Best Available Control Technology (BACT) and offsets.

(Note that CA BACT is defined in such a manner as to be equivalent to federal LAER 

requirements.) The application of CA BACT is triggered for emission increases of 25 lb/day in 

areas classified as moderate and 10 lbs/day in areas classified as serious, severe or extreme. In 

addition, some California Districts have adopted even lower CA BACT thresholds of two and 

zero lb/day. The requirement to provide offsets is triggered for all emission increases, once a 

facility’s emissions exceed 25 tpy in areas classified as moderate; 15 tpy in areas classified as 

serious; and 10 tpy in areas classified as severe or extreme.

California and Federal BACT/LAER and Offset Thresholds for 1-hr Ozone

CA Ozone Classification (ppm) Marginal Moderate

(0.09 - ≤0.12)

Serious

(0.13 - ≤0.15)

Severe

(0.16 - ≤0.20)

Extreme

(>0.20)

CA BACT2 (tpy) [lb/day] NA 4.6 [25] 1.8 [10] 1.8 [10] 1.8 [10]

CA Offset1(tpy) NA 25 15 10 10

EPA Ozone Classification

(ppm)

Marginal

(0.121 - <0.138)

Moderate

(0.138 -

≤0.160)

Serious

(0.160 - ≤0.180)

Severe

(0.180 - ≤0.280)

Extreme

(>0.28)

Federal Major Source (tpy)

(Triggers both LAER & Offsets)

100 100 50 25 10

Federal Major Mods (tpy) 

(Triggers both LAER & Offsets)

40 40 25 25 0

Note: California design values are lower than federal values for the same classification.

NSR Reform Program Requirements

On December 30, 2002, EPA published a final rulemaking action to provide additional flexibility 

in the permitting of modified sources subject to the federal major source NSR and PSD 

programs. EPA’s intent was to allow existing sources additional flexibility in the NSR/PSD 

permitting process that would encourage facilities to make process improvements or undertake 

energy efficiency projects that would provide additional environmental benefits by reducing 

 

2 California Health & Safety Code §§ 40918, 40919, 40920 and 40920.5
28

emissions on a capacity basis. In 2005, a court vacated two key NSR Reform provisions3, but 

also upheld the three key remaining provisions. These provisions all pertain to how emission 

increases from proposed modifications of existing sources are calculated.

One provision allows an existing facility to set a Plantwide Applicability Limit (PAL), which in 

effect is a facility-wide emissions cap for a specific pollutant. Once the PAL is determined, a 

facility can make any physical modification or change in the method of operation, which might 

otherwise trigger a major modification, without obtaining a NSR permit, as long as the plantwide 

emissions remain below the PAL level. For certain types of industries that need significant 

operational flexibility to make quick changes in response to changing market conditions, the 

ability to make changes without having to wait for the issuance of construction permits is worth 

the additional work to ensure emissions from all operations remain below the PAL and maintain 

the additional records needed to verify compliance with the plant-wide emission limits.

Another provision changed the allowable time frame to be used to determine baseline actual 

emissions. Baseline emissions are generally considered to be the pre-project emissions from the 

facility or emission units proposed to be modified. Prior to implementing the NSR Reforms, EPA 

required a source to use the actual emissions emitted during the two year period immediately 

preceding the application date for the new project. Sources were allowed to use a different two 

year period within the five year period immediately preceding the application date if they could 

demonstrate that the alternative two year period was more representative of normal operations.

The NSR Reforms revised the allowable time frame to be any 24 month period during the 10 

year period immediately preceding the application date. EPA believes that the use of a 10 year 

period allows a source to look back to a period from a more representative business cycle, i.e., 10 

years vs. five years, and that significant resources are conserved by allowing the source to 

choose the 24 month period used to establish baseline actual emissions, rather than spend time 

and resources determining what period most represents “normal operations.” While going back 

further in time means a source may be able to choose a period with higher average emissions, the 

NSR Reforms also added requirements to ensure the baseline period is adjusted for any excess 

emissions or any additional emission reductions required by new regulations which have become 

effective since the baseline period.

The third provision upheld by the court changed how post-project emissions are determined.

Prior to implementing the NSR Reforms, EPA required a source to use the worst case potential 

to emit (PTE) assumptions (i.e., operating at 100% capacity, 24 hrs/day, 7 days a week), unless 

the applicant agreed to practically enforceable permit conditions to limit operation of the 

emission unit (i.e. fuel usage limits or limits on hours of operation). In this “actual to potential” 

test, often the difference between the baseline actual emissions and the PTE of an operation 

would be greater than the major modification significance thresholds. As a result, many 

modifications were treated as major modifications, even when the actual emissions would 

decrease, not change, or the actual increase in emissions would not be significant. The NSR 

Reforms changed the post-project emission calculation methodology to allow a source to use the 

 

3 The United States Court of Appeals for the District of Columbia Circuit in State of New York, et al., v. U.S. 

Environmental Protection Agency, et al., 413 F.3d 3 (D.C. Cir. 2005)
29

highest actual emission rate projected to occur over the next 5 or 10 years and to subtract 

emissions the emission units could have accommodated prior to the project, that were unrelated 

to the project, in order to determine the emission increase from the proposed project. 

It is important to note that none of these revisions changed the major modification significance 

thresholds for triggering control technology and offset requirements. They only changed the 

calculation to determine if the major modification threshold is triggered.

Impacts of Federal NSR Reforms on California NSR Permitting Programs

By not adopting the NSR Reforms, the NSR program in California Districts would not include 

the three program elements described earlier: use of PALs, a 10 year look back period for 

baseline actual emissions and projected actual emissions. The use of two of these three 

provisions (baseline actual emissions and projected actual emissions) is required under 40 CFR 

51.165(a)(2). The requirement to adopt a NSR program that allows the use of PALs is found in 

40 CFR 51.165 (f). The MBUAPCD added Section 6.3 to provide sources the option of obtaining 

a PAL. This provision satisfies the requirement to allow the use of PALs.

Section 116 of the CAA4provides that nothing in the Act shall preclude the rights of States to 

adopt air pollution regulations that are more stringent than those contained in the CAA or 

implementing regulations. As noted above, the California CAA of 1988 adopted lower emission 

thresholds for triggering emission control (BACT/LAER) and offset requirements for new and 

modified sources as part of its NSR program. Consistent with this concept, when EPA adopted 

new calculation methods to implement the NSR reforms in 40 CFR 51.166 (a)(7),5 we also stated 

that each plan must use the specific applicability provisions specified unless the State 

specifically demonstrates that the submitted plan provisions “are more stringent than or at least 

as stringent” in all respects as the specified paragraphs. These applicability provisions specify the 

use of baseline actual emissions and projected actual emissions, two of the new NSR Reform 

provisions, but also retain the option for a source to use the actual to potential emission test.

Several air districts in California have argued that their NSR and PSD permit programs are 

inherently more stringent than the required federal program because the applicability thresholds

for applying CA BACT and offsets are significantly lower than those in the federal CAA. In 

addition, for modifications, a source does not need to be a major source, as it does for federal 

purposes, before these lower applicability thresholds apply to a proposed project. The districts

also point out that if a District adopted the NSR Reform calculation methods, and a project using 

 

4 Section 116 of the CAA: Except as otherwise provided in sections 119 (c), (e), and (f) (as in effect before the date 

of the enactment of the Clean Air Act Amendments of 1977), 209, 211(c)(4), and 233 (preempting certain State 

regulation of moving sources) nothing in this Act shall preclude or deny the right of any State or political 

subdivision thereof to adopt or enforce (1) any standard or limitation respecting emissions of air pollutants or (2) 

any requirement respecting control or abatement of air pollution; except that if an emission standard or limitation is 

in effect under an applicable implementation plan or under section 111 or 112, such State or political subdivision 

may not adopt or enforce any emission standard or limitation which is less stringent than the standard or limitation 

under such plan or section.

5 The NSR reforms are also codified for nonattainment programs in 40 CFR 51.165 (a)(2). However, since 

MBUAPCD is currently classified attainment or unclassifiable for all NAAQS, the requirement to have a permit 

program that satisfies the requirements of 40 CFR 51.165 is not applicable.
30

these methods was no longer classified as a major modification, it would not be subject to 

Federal LAER and offsets requirements for NSR or Federal BACT for PSD; but the project 

would still have to apply CA BACT and provide offsets in accordance with the CA CAA 

requirements. These lower state emission thresholds are already in almost all Districts’ portion of 

the California SIP, making these requirements enforceable under both state and federal law.

As a result, CA Districts have argued that the regulatory framework found in other states, where 

adopting the NSR Reforms provide additional permitting flexibility and environmental benefits, 

do not exist in California because adoption of the reform requirements would have no effect on 

the application of control technology or offset requirements.

EPA has reviewed the Districts’ claims and considered how the CA CAA provisions affect the 

effectiveness of the NSR Reforms to provide the intended regulatory relief, and we agree that the 

application of CA BACT and offsets at significantly lower thresholds means that the federal 

NSR Reform provisions do not provide any of EPA’s intended additional flexibility to proposed 

projects that may otherwise trigger federal major modification requirements. If the State adopts 

these provisions, a new project will have to complete two different sets of emission calculations;

and even if the federal requirements are not applicable, the source will still have to comply with 

the CA BACT control and offset requirements if they are triggered. In light of these facts, EPA is 

proposing to find that it is acceptable for MBUAPCD to not incorporate the NSR Reform 

provisions into their SIP approved NSR and PSD programs, since the same level of control will 

be required for modified sources, with or without inclusion of these provisions in the SIP, and 

their program will not be any less stringent than the federal program.

Section 110(l) of the Act

Section 110(l) of the Act prohibits EPA from approving any revision of a SIP if the revision 

would interfere with any applicable requirement concerning attainment and reasonable further 

progress, or any other applicable requirement of the Act. The SIP approved version of the rules 

being evaluated under this TSD were approved into the SIP on the dates listed in Table 2 of this 

document. While the District has adopted revisions to these rules since that time, for the 

purposes of the 110(l) evaluation, we must compare the submitted rules with the current SIP 

version. The SIP approved rules contain provisions for all major source and minor source 

permitting actions. Because the air basin is currently classified attainment or unclassifiable for all 

NAAQS, our evaluation only considers the requirements of the PSD program found in 40 CFR 

51.166 and the minor source program requirements found in 40 CFR 51.160-164. In addition, 

since the District is currently designated as attainment for all the NAAQS, no rule revisions 

could interfere with reasonable further progress. Based on the following analysis, we conclude 

that full approval of Rules 203, 204, 206 and 212 and limited approval / limited disapproval of

Rule 207, and the repeal of Rule 208 from the SIP would overall strengthen the applicable SIP.

Rule 203 – Application

This rule is being submitted for SIP approval for the first time. The provisions provided in Rule 

203 help clarify the application process. Rule 203 will not interfere with any applicable 
31

requirement concerning attainment and reasonable further progress, or any other applicable 

requirement of the Act.

Rule 204 – Cancellation of Applications

All of the revisions to this rule are minor in nature (see rule summary section) and can be 

considered administrative in nature in that they do not change any applicable thresholds for 

requirements or emission limits. Therefore the revisions made to Rule 204 will not interfere with 

any applicable requirement concerning attainment and reasonable further progress, or any other 

applicable requirement of the Act.

Rule 206 – Standards for Granting Applications

All of the revisions to Part 1 of this rule are minor in nature (see rule summary section) and can

be considered administrative in nature in that they do not change any applicable thresholds for 

requirements or emission limits. The revisions made to Parts 3 and 4 of this rule strengthen the 

SIP in that they clarify the criteria for issuing a Permit to Operate, require the District to deny a 

final permit unless specific requirements have been meet. Therefore the revisions made to Rule 

204 will not interfere with any applicable requirement concerning attainment and reasonable 

further progress, or any other applicable requirement of the Act.

Rule 207 – Review of New or Modified Sources

Rule 207 applies to any pollutant subject to regulation under the CAA, which includes at least 7 

pollutants, such as fluorides, PM, hydrogen sulfide and greenhouse gases for which EPA has not 

established a NAAQS. We are not evaluating these 7 pollutants for compliance with the 

requirements of CAA section 110(l) since these pollutants cannot affect attainment and 

reasonable further progress.

Several revisions have been made to Rule 207 since EPA last approved the rule into the SIP. 

Most of these revisions are administrative in nature and provide additional clarification and/or 

enforceability to the rule. We discuss below additional revisions which may affect continued 

attainment of the NAAQS in the Monterey Bay air basin. 

In Part 1, new provisions have been added which exempt Stationary Sources with emissions of 

less than 10 tpy of all individual criteria pollutants, certain Emergency Internal Combustion 

Engines, and the installation of control equipment required to comply with applicable 

requirements, if the resulting increase is less than the thresholds for a federal major modification, 

from providing offsets. While the underlying requirement to provide emission offsets is no 

longer applicable because MBUAPCD is no longer classified nonattainment for any NAAQS, 

the result of these new provisions is that the quantity of offsets provided for these sources would

be fewer than required under the current SIP approved version of Rule 207.

EPA notes that each of these new offset exemptions is either narrow in scope or apply to small 

stationary sources (those emitting less than 10 tpy). For example, the new exemption for 

Emergency Engines is limited in scope in that it only applies to engines used for emergency 

power when line service fails or for the emergency pumping of water. In addition, these engines 

may only be operated less than 60 hours per year for testing and exercise. Likewise the new 
32

exemption for the installation of required control equipment is limited to emission increases that 

would not otherwise result in a major modification. 

In Part 2, the definition of Best Available Control Technology (BACT) was revised to remove 

the language that implemented the definition of federal LAER (Lowest Achievable Emission 

Rate) as defined in 40 CFR 51.165. While this revision is permissible because the District is no 

longer required to maintain a nonattainment NSR program pursuant to 51.165, it means that the 

level of control required for some projects will not be as low as it might otherwise be if the 

control technology standard was LAER rather than BACT. EPA notes that for minor sources, 

there is often no difference between LAER and BACT control levels. 

The MBUAPCD has been designated as attainment of the NAAQS for many years. These new 

exemption provisions and the change to the definition of BACT were adopted locally in 199X, 

and have not interfered with the District’s ability to continue to attain the NAAQS. Therefore, 

EPA does not believe that approval of these narrowly written offset exemptions or the change in 

the definition of BACT will interfere with the District’s continued ability to attain the NAAQS. 

Rule 208 – Standards for Granting Permits to Operate (Request to Repeal)

The provisions contained in Rule 208 were incorporated into Rule 207. We evaluate any changes 

made from the SIP version of this rule under our evaluation for Rule 207. 

Rule 212 – Public Availability of Emission Data

This rule contains no provisions that would interfere with any applicable requirement concerning 

attainment and reasonable further progress, or any other applicable requirement of the Act. 

Therefore this provision is not subject to the requirements of 110(l).

Overall the District has made many small revisions which improve the clarity and enforceability 

of each rule. In Rule 207, there are some new provisions which may result in somewhat lager 

emission increases when compared to the existing SIP approved versions of Rule 207, we 

believe these emission increases to be sufficiently small as to not interfere with the ability to 

maintain the NAAQS. In addition, Rule 207 has been strengthened by providing new 

requirements for the regulation and control of PM2.5 emissions. Therefore we find the revisions 

provided in the submitted rules to be approvable under 110(l).

Section 193 of the Act

Section 193 of the Act, which was added by the Clean Air Act Amendments of 1990, includes a 

savings clause which provides, in pertinent part: “No control requirement in effect, or required to 

be adopted by an order, settlement agreement, or plan in effect before November 15, 1990, in 

any area which is a nonattainment area for any air pollutant may be modified after November 15, 

1990, in any manner unless the modification insures equivalent or greater emission reductions of 

such air pollutant.”
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The MBUAPCD is currently classified as attainment or unclassifiable for all NAAQSs, therefore 

the provisions of Section 193 are not applicable to this action. 

Recommendations

Pursuant to section 110(k)(3) of the Act, we recommend disapproval of Rule 200 – Permits 

Required, approval of the request to repeal Rule 208 – Standards for Granting Permits to 

Operate, full approval of Rules 203 – Application, 204 – Cancellation of Applications, 206 –

Standards for Granting Applications and 212 – Public Availability of Emission Data, and limited 

approval/limited disapproval of submitted Rule 207 – Review of New or Modified Sources. 

We recommend disapproval of Rule 200 based on our determination that the additional language 

added to Part 4 of the rule contravenes the provisions of 40 CFR 52.23, and therefore the 

revision is not approvable. The existing version of Rule 200, approved by EPA on July 1, 1999 

will remain as the SIP approved version of this rule.

We recommend approval of the request to repeal Rule 208 based on our determination that all 

the applicable requirements have been incorporated into Rule 207. 

We recommend the approval of submitted Rules 203, 204, 206 and 212, based on our 

determination that the rules comply with applicable statutory and regulatory provisions requiring 

regulation of stationary sources. In support of this recommendation, we have concluded that our 

approval of Rules 203, 204, 206 and 212, complies with section 110(l) of the Act because the 

revisions to these rules do not relax control technology requirements and therefore would not 

interfere with the strategy for continued attainment of the NAAQS in MBUAPCD. 

We recommend the limited approval of submitted Rule 207 based on our determination that the 

rule complies with applicable statutory and regulatory provisions requiring regulation of 

stationary sources in general and requiring permit programs for major stationary sources in 

particular, including section 110(a)(2)(C) and part C of title I of the Act. In support of this 

recommendation, we have concluded that our limited approval/limited disapproval of Rule 207 

complies with section 110(l) of the Act because while the revisions provide some relaxations to 

the control technology requirements, the impacts of these revisions are not likely to interfere 

with the strategy for continued attainment of the NAAQS in MBUAPCD. However we also 

recommend limited disapproval of Rule 207 to correct the deficiencies listed below.

If we finalize this action as proposed, our action would be codified through revisions to 40 CFR 

52.220 (identification of plan).

Deficiencies as listed in TSD under section titled Permit Program Evaluations:

1. Add a provision to provide an explicit public notice threshold for PM2.5. (See page 13.) 

2. Add a provision to provide an explicit public notice threshold for lead. (See page 14.)
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3. Revise the definition of the terms “Major Stationary Source” and “Major Modification to 

an Existing Source” to include the specific applicability thresholds as provided in 40 CFR 

51.166 for these terms. (See page 17)

4. Revise the definition of the term “Major Modification to an Existing Source” to clarify 

that the calculation of the emission increase for the modification is based on an actual to 

potential to emit or an actual to projected actual emissions basis. (See page 18)

5. Add provisions to satisfy the requirement to define significant as defined in 

51.166(b)(23)(ii) and (iii). (See page 20)

6. Add provisions to satisfy the 40 CFR 51.166(q) requirement to provide the opportunity 

for a public hearing to consider a proposed permit action. (See page 26)

7. Add provisions to satisfy the requirements, pursuant to 40 CFR 51.166(r)(1) and (2), 

regarding sources obligations. (See page 26)
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Attachments

1. Current MBUAPCD SIP Rule 200, Permits Required, SIP approved July 1, 1999

2. Current MBUAPCD SIP Rule 204, Cancellation of Applications, SIP approved July 1, 

1999

3. Current MBUAPCD SIP Rule 206, Standards for Granting Applications, SIP approved 

July 13, 1987

4. Current MBUAPCD SIP Rule 207, Review of New or Modified Sources, SIP approved 

February 4, 2000

5. Current MBUAPCD SIP Rule 208, Standards for Granting Permits to Operate, SIP 

approved July 13, 1987

6. Current MBUAPCD SIP Rule 212, Public Availability of Emission Data, SIP approved 

July 13, 1987

7. Submitted MBUAPCD Rule 200, Permits Required, adopted December 13, 2000

8. Submitted MBUAPCD Rule 203, Application, adopted October 16, 2002

9. Submitted MBUAPCD Rule 204, Cancellation of Applications, adopted March 21, 2001

10. Submitted MBUAPCD Rule 206, Standards for Granting Applications, adopted March 

21, 2001

11. Submitted MBUAPCD Rule 207, Review of New or Modified Sources, adopted April 20, 

2011

12. Submitted MBUAPCD Rule 208, Standards for Granting Permits to Operate, Request to 

Repeal on December 13, 2000

13. Submitted MBUAPCD Rule 212, Public Availability of Emission Data, adopted October 

16, 2002