STAFF REPORT

Rule 10.1: New Source Review

Date of Release: August 22, 2014

Schedule of Meetings

Public Hearing: October 6, 2014

Feather River AQMD

1007 Live Oak Blvd, Suite B-3,

Yuba City, California 95991
Table of Contents

Contents Page 

1. Executive Summary...........................................................................................1

2. Background........................................................................................................1

3. Legal Mandate ...................................................................................................1

4. Proposed Rule Requirements.............................................................................3

5. Socioeconomic Impact.......................................................................................4

6. Impacts of the Proposed Rule ............................................................................4

7. Estimated Cost Impact .......................................................................................4

8. Environmental Review and Compliance ...........................................................5

9. Required Findings..............................................................................................6

10. Rule Analysis.....................................................................................................7
Proposed Rule: 10.1 August 22, 2014 

1.0 Executive Summary:

The Feather River Air Quality Management District’s (District) New Source Review (NSR) program was 

established in February 1993 to ensure that construction and operation of new and modified sources does 

not interfere with progress towards attainment of the National and State Ambient Air Quality Standards. 

Because portions of the District have been designated as nonattainment for various pollutants, the United 

States Environmental Protection Agency (US EPA) requires the District to implement measures to reduce 

sources of these pollutants and their precursors. The District makes its commitment to reduce pollution 

through the State Implementation Plan (SIP). The SIP is federally enforceable through the US EPA and 

the Federal Clean Air Act (CAA). A New Source Review, or preconstruction review, is required as part 

of the SIP.

Rule 10.1 contains procedures for the review of new and modified stationary air pollution sources and 

provides mechanisms by which permits may be granted without interfering with the attainment or 

maintenance of ambient air quality standards and includes the pre-construction permit program required 

under Part D of Title I of the Clean Air Act. The purpose of the proposed amendments of Rule 10.1 is to 

correct the deficiencies in the rule as identified by the US EPA. Minor changes are needed to gain full 

US EPA approval into the State Implementation Plan (SIP).

2.0 Background:

On July 27, 2011, US EPA finalized a limited approval and limited disapproval of FRAQMD Rule 10.1 –

New Source Review. The effect of this action was to incorporate Rule 10.1 into the SIP and to trigger 

sanctions clocks with respect to certain provisions of the rule that did not satisfy the requirements of the 

CAA. FRAQMD had until February 26, 2013 to correct the deficiencies or sanctions would be imposed.

On February 2, 2012, the District amended Rule 10.1 to correct the stated deficiencies, and FRAQMD 

submitted the amended rule to the SIP soon thereafter. The US EPA reviewed the rule and on September 

24, 2013, finalized a new limited approval limited disapproval of FRAQMD Rule 10.1. US EPA 

acknowledged that the previous deficiencies in the rule were fixed; however, two new deficiencies were 

listed. FRAQMD is required to correct the new deficiencies to have a fully approved New Source Review 

program.

3.0 Legal Mandate:

Federal Mandate: The District has multiple designations regarding attainment of the air quality 

standards set forth by the US EPA. The District currently has three separate nonattainment areas:

1. Sacramento Federal Nonattainment Area (SFNA) for Ozone

The southern portion of Sutter County has been designated as a serious nonattainment area for the 

federal 1997 and 2008 8-hour ozone standard. This portion of Sutter County, along with 

Sacramento, Yolo, and portions of Placer, El Dorado and Solano Counties are incorporated into 

the SFNA.

2. Sutter Buttes Nonattainment Area (SBNA) for Ozone

The Sutter Buttes (portions above 2,000 feet elevation) in Sutter County is designated as a 

moderate nonattainment area for the federal 1997 8-hr ozone standard.

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Proposed Rule: 10.1 August 22, 2014 

3. Yuba City-Marysville Nonattainment Area (YC-MNA) for PM2.5

Sutter County and part of Yuba County is designated as a moderate nonattainment for the federal 

PM2.5 standard. The portion of Yuba County in the YC-MNA is listed in 40 CFR 81.305 as:

“That portion of Yuba County which lies west of the line described as follows: (Mount Diablo 

Base and Meridian) Beginning at the intersection of the Yuba-Nevada county line and the range 

line common to ranges R7E and R8E, north to the southeast corner of township T18N R7E, then 

west along the township line common to T17N and T18N, then north along the range line 

common to ranges R6E and R7E, then west along the township line common to T19N and T18N 

to the Yuba-Butte County boundary.”

Thus, the entire valley portion of Yuba County and the western portion of the foothills are 

included in the nonattainment area.

Section 173 of Title I of the Federal Clean Air Act Amendments of 1990 requires permitting authorities to 

establish a permitting program for reviewing applications for construction of new sources or modification 

of existing sources of air pollutants. A New Source Review, or preconstruction review, is required as part 

of the SIP under 40 Code of Federal Regulations (CFR) Part 51 Subpart I to ensure that the construction

or modification of a source will not cause violations of the State’s control strategy or interfere with 

attainment or maintenance of ambient air quality standards. 40 CFR Part 51 also requires the District to 

adopt a permitting program that requires the application of Best Available Control Technology (BACT)

and Lowest Achievable Emission Rate (LAER) for a new major stationary source or modification to an 

existing major stationary source that results in a significant net emissions increase.

State Mandate: California Health and Safety (CH&S) Code §40918 and 40919, require that the 

District’s permitting program be designed to achieve no net increase in emissions of nonattainment 

pollutants from stationary sources with emissions exceeding specified thresholds. Furthermore, Title 17 

California Code of Regulations (CCR) §70600 requires ozone nonattainment districts in the Broader 

Sacramento Area to adopt more stringent thresholds. The Broader Sacramento Area is defined in Title 17 

CCR §70500. The entire SFNA portion of FRAQMD is designated in the Broader Sacramento Area. 

CH&S Code §40918 and 40919 also require the District’s permitting program to require the use of BACT 

for any new or modified stationary source which has a potential to emit greater than or equal to specific 

thresholds, which vary depending on the attainment status of the area.

Chapter 4.5, Protect California Air Act of 2003 Requirements: In an effort to minimize the potential 

impact of the 2002 federal NSR reforms, the state legislature passed the Protect California Air Act of 

2003 (SB288). The Act (CH&S Code §42500 through 42507) is intended to minimize the impact of the 

relaxation of the federal new source review program on air quality in California. The Act prohibits 

districts from making revisions to their SIP approved NSR rules in existence on December 30, 2002 that 

would result in weakening their rules. These revisions include but are not limited to, revisions to rule 

applicability, changing the definition of modification so that NSR is not triggered or triggered at a higher 

level of emission increases, or relaxing BACT, air quality analysis, and public participation requirements. 

The Act does permit districts to deviate from these requirements under specified conditions.

The proposed amendments to Rule 10.1 meet this mandate. Rule 10.1 does not relax the requirements to 

obtain a permit and undergo NSR analysis, does not relax the requirement to apply BACT to a new or 

modified emission unit, does not relax the requirements or thresholds for performing an air quality impact 

analysis as required by Rule 10.1 G, does not relax the requirement for regulating any air pollutant, does 

not relax any requirement for public participation, and does not relax the requirements for monitoring, 

recordkeeping, and reporting.

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Proposed Rule: 10.1 August 22, 2014 

4.0 Proposed Rule Requirements:

Table 1 below summarizes the proposed rulemaking by section:

Table 1 – Summary of Proposed Amendments

SECTION NUMBER PROPOSED LANGUAGE

B.4 & B.5 Added language to limit the exemption applicability to more specific sections 

rather than exempting any re-designated areas from the entirety of Section E. 

D.34 & D.35 Amended the definitions of PM10 and PM2.5 to include condensable particulate 

matter.

H.3 Added public notice requirements for lead point sources pursuant to federal 

regulations.

Rule 10.1 - All Minor formatting and editing.

Exemption Language

Sections B.4 and B.5 were added to the rule in 2012 and provide that if the US EPA re-designates 

specific nonattainment portions of the District to attainment for PM2.5 or ozone, then the 

requirements of Section E of the rule would not apply to those areas. While the District is allowed to 

include provisions that would change the applicability of the rule based on a redesignation by the US 

EPA to attainment, the District mistakenly wrote into the rule the exemption from all of the 

requirements of Section E. Some of the subsections of Section E contain requirements that apply to 

minor sources and so these must apply even if the areas are re-designated attainment. Hence, the 

District has added language to the exemptions to limit the applicability to more specific sections 

rather than exempting them from the entirety of Section E.

Condensable PM:

Primary Particulate Matter (PM) is the sum of filterable PM and Condensable Particulate Matter 

(CPM). Filterable PM are particles that are directly emitted by a source as a solid or liquid at stack

conditions and captured on the filter of a stack test train. CPM are emissions that are vapor phase at 

stack conditions, but which condense and/or react upon cooling and dilution in the ambient air to 

form solid or liquid PM immediately after discharge from the stack.

The NSR regulations require that the measurement and control of PM from major stationary sources 

and major modifications include the condensable component for both PM10 and PM2.5 emissions. 

Accordingly, CPM must be considered for permits addressing PM10 and PM2.5 that are issued under 

the Prevention of Significant Deterioration (PSD) program and the nonattainment NSR program in 

areas that are classified attainment/unclassifiable and nonattainment, respectively, for the PM10 and 

PM2.5 National Ambient Air Quality Standards (NAAQS). By amending the definitions in Rule 10.1, 

the District’s NSR rule will adequately reflect this requirement for CPM.

Omitting VOC and Ammonia as PM2.5 precursors:

The District was designated “nonattainment” for the federal PM2.5 NAAQS on December 14, 2009. Based 

on the 2009-2011 monitoring data, the District demonstrated meeting the PM2.5 NAAQS and submitted a 

Clean Data Finding for PM2.5. As part of US EPA approval of the Clean Data Finding, the District 

submitted a Redesignation Request and Maintenance Plan. The PM2.5 Redesignation Request and 

Maintenance Plan is intended to provide necessary data and analyses to demonstrate that the Yuba CityMarysville PM2.5 nonattainment area has attained the 2006 24-hour PM2.5 national ambient air quality 

standard and shall continue to maintain the standard for ten years from the approval of the Plan. The 

District is still waiting on final US EPA approval of the Maintenance Plan.

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Proposed Rule: 10.1 August 22, 2014 

During this rule development process, the US EPA also requested that FRAQMD reviews the District 

emission inventory to determine if VOC and ammonia (NH3) “contribute significantly” to the PM2.5 

inventory. See Section 189(e) of the CAA. This request is based on EPA’s final rulemaking dated June 2, 

2014, which reclassified all PM2.5 nonattainment areas pursuant to Subpart 4 of Title I of the CAA, rather 

than Subpart 1. Under Subpart 4, the CAA assumes all PM2.5 precursors are subject to an areas 

nonattainment program, unless a showing is made that specific precursors from major sources do not 

“contribute significantly to PM10 (or PM2.5) levels which exceed the standard in the area.”

The District does not have any VOC or NH3 major sources, therefore there is no significant contribution 

from major sources to PM2.5 levels which exceed the PM2.5 standard. In addition, as noted above the area 

has maintained the standard for the past four years without any additional VOC or ammonia controls. On 

the basis of these facts, the District believes that these two precursors do not contribute significantly to 

PM2.5 levels which exceed the standard in the area, and therefore, are not required to be regulated as PM2.5

precursors under section 189(e) of the CAA.

5.0 Socioeconomic Impact:

California Health and Safety Code §40728.5 requires, in part, that:

“Whenever a district intends to propose the adoption, amendment or repeal of a rule or 

regulation that will significantly affect air quality or emissions limitations, that agency 

shall, to the extent that data are available, perform an assessment of the socioeconomic 

impacts of the adoption, amendment, or repeal of the rule or regulation.”

However, districts with a population of less than 500,000 persons are exempt from the provisions of 

CH&S §40728.5 (a). The District’s population is estimated to be approximately 168,000, which is below 

the 500,000 person threshold. Therefore, a socioeconomic analysis for this rulemaking is not required.

6.0 Emission Impacts of the Proposed Rule:

The District does not anticipate any emission impacts from the proposed rule.

7.0 Estimated Cost Impact:

CH&SC §40703 requires the District, in the process of the adoption of any rule or regulation, to consider 

and make public its findings related to the cost effectiveness of the rule. Cost effectiveness for rulemaking 

purposes is calculated by dividing the cost of air pollution controls required by the rule by the amount of 

air pollution reduced. 

The District does not anticipate any cost impacts from the proposed rule or any additional need for staff 

resources upon adoption of the rule.

8.0 Environmental Review and Compliance:

California Public Resource Code Section 21159 requires the District (at the time of adopting a rule 

requiring the installation of pollution control equipment, or a performance standard) to perform an 

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Proposed Rule: 10.1 August 22, 2014 

environmental analysis of the reasonably foreseeable methods of compliance. This rule does not require 

installation of control equipment or a performance standard; therefore, the analysis is not required.

The amendment of this rule is an action taken to protect the environment. Therefore, staff has determined

that the proposed rule is categorically exempt under Class 8 from the California Environmental Quality 

Act (CEQA) pursuant to CEQA Guidelines sections 15061(b)(2) and 15308 because it is an action taken 

by a regulatory agency to assure the maintenance, restoration, enhancement, or protection of the 

environment and no exceptions apply.

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Proposed Rule: 10.1 August 22, 2014 

9.0 Required Findings:

California Health and Safety Code §40727(a) requires that prior to adopting or amending a rule or 

regulation, an air district’s board must make findings of necessity, authority, clarity, consistency, nonduplication and reference. The findings must be based on the following:

1. Information presented in the District’s written analysis, prepared pursuant to CH&S §40727.2;

2. Information contained in the rulemaking records pursuant to CH&S §40728; and

3. Relevant information presented at the Board’s hearing for the rule.

The table below describes each finding and the basis for making the finding:

REQUIRED FINDING FINDING DETERMINATION

Necessity: 

The District must find that the rulemaking 

demonstrates a need exists for the rule or for its 

amendment or repeal. [CH&S §40727 (b)(1)]

It is necessary for the District to adopt the 

proposed amendments in order to correct 

deficiencies found by the EPA during the SIP 

approval process.

Authority: 

The District must find that a provision of law or of 

a state or federal regulation permits or requires the 

District to adopt, amend, or repeal the rule. 

[CH&S §47027(b)(2)]

The District is authorized to adopt rules and 

regulations by CH&S §40001, 40702, 40919, 

41010, and 42300.

Clarity: 

The District must find that the rule is written or 

displayed so that its meaning can be easily 

understood by the persons directly affected by it.

[CH&S §40727(b)(3)]

The District has reviewed the proposed 

amendments and determined that they can be 

easily understood by the affected industry. In 

addition, the record contains no evidence that the 

persons directly affected by the rule cannot 

understand the rule.

Consistency: 

The rule is in harmony with, and not in conflict 

with or contradictory to, existing statutes, court 

decisions, or state or federal regulations. 

[CH&S §40727(b)(4)]

The proposed rule does not conflict with and is

not contradictory to existing statutes, court 

decisions, or state or federal regulations.

Non-Duplication:

The District must find that either: 1) The rule does 

not impose the same requirements as an existing 

site or federal regulation; or 2) that the duplicative 

requirements are necessary or proper to execute the 

powers and duties granted to, and imposed upon 

the District. 

[CH&S §40727(b)(5)]

The proposed rule duplicates federal rules or 

regulations for permitting programs. The 

duplicative requirements are necessary in order 

to execute the powers and duties imposed upon 

the District.

Reference:

The District must refer to any statute, court 

decision, or other provision of law that the District 

implements, interprets, or makes specific by 

adopting, amending or repealing the rule. [CH&S 

§40727(b)(6)]

The proposed amendments are intended to clarify 

existing law. References to statutes are noted 

where applicable.

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Proposed Rule: 10.1 August 22, 2014 

10.0 Rule Analysis

Section 40727.2 requires a written analysis comparing the proposed rules with existing federal 

regulations, state regulation, and any other AQMD existing or proposed rules and regulations 

that apply to the same source type.

Comparison of Proposed Rule 10.1 and

Feather River AQMD Rules and Regulations

District Rules and Regulations

Does proposed rule 

conflict or contradict 

any provisions?

Regulation 1 – General Provisions No

Regulation 2 – Open Burning No

Regulation 3 – Prohibition – Stationary Emission Sources No

Regulation 4 – Stationary Emission Sources Permit System and 

Registration No

Regulation 5 – Hearing Board Procedures No

Regulation 6 – Variances No

Regulation 7 – Fees No

Regulation 8 – Penalties and Abatement No

Regulation 9 – Enforcement Procedures No

Regulation 10 – New Source Review No

Regulation 11 – Air Toxic Control Measure No

Comparison of Proposed Rules and other Federal and State Regulations

Under CH&S § 40727.2(g), the District finds that the proposed amendments do not strengthen or 

impose new emission limits or impose more stringent monitoring, reporting, or recordkeeping 

requirements; therefore, it complies with CH&S Code § 40727.2.

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