Review of New Mexico State Implementation Plan Submittal Required Under Section 507 for the Small Business Stationary Source Technical and Environmental Complian ce Assistance Program

Docket ID EPA-R06-OAR-2014-0642

Technical Support Document February 2016

Table of Contents:

I. Summary

II. Background

III. Criteria Used in Evaluation IV. Analysis of State Submittal

A. Procedural Background

B. Plan Requirements

1. Small Business Assistance Program

2. Ombudsman

3. Compliance Advisory Panel

4. Eligibility of Small Business Stationary Sources
V. Conclusion VI. SIP Implementation

Appendix: SIP Revision Approval Checklist for Section 507 Small Business Assistance Program

I. Summary

This Technical Support Document (TSD) reviews the State Implementation Plan (SIP) revision submitted by the State of New Mexico for the purpose of establishing a Small Business Stationary Source Technical and Environmen tal Compliance Assistance Program. The SIP revision was submitted by New Mexico to satisfy the Federal mandate, found in section 507 of the Clean Air Act (CAA), to ensure that small bus inesses have access to the technical assistance and regulatory information necessary to comply with the CAA. The rationale for proposing approval of this SIP revision is set forth in this TSD.

II. Background

Implementation of the provisions of the CAA, as amended in 1990, requires regulation of small businesses so that areas may attain and maintain the National Ambient Air Quality Standards (NAAQS) and reduce the emissions of air toxics. Small businesses frequently lack the technical expertise and financial resources necessary to ev aluate such regulations and to determine the2

appropriate mechanisms for compliance. Anticipa ting the potential impacts of these requirements on small businesses, the 1990 amendments to th e CAA require that each State adopt a Small Business Stationary Source Technical and E nvironmental Compliance Assistance Program (“Program”), and submit this Program as a revisi on to the Federally-approved SIP. In addition,
the CAA directs the EPA to oversee these sma ll business assistance programs and report to Congress on their implementation.

III. Criteria Used in Evaluation

The requirements for establishing a Program are set out in section 507 of tit le V of the CAA. In February 1992, the EPA issued “Guidelines fo r the Implementation of Section 507 of the 1990 Clean Air Act Amendments” in order to delineate the Federal and State roles in meeting the new statutory requirements and as a tool to provide further guidance to the States on submitting approvable SIP revisions.

The State of New Mexico on November 5, 1992, subm itted a SIP revision to the EPA in order to satisfy the requirements of section 507. In order to gain full approval, the State submittal must provide for each of the following three Program elements: (1) the establishment of a Small Business Assistance Program (SBAP) to provide technical and compliance assistance to small businesses; (2) the establishment of a State Sm all Business Ombudsman to represent the interests of small businesses in the regul atory process; and (3) the crea tion of a Compliance Advisory Panel (CAP) to direct the efforts and determin e and report on the overa ll effectiveness of the

SBAP.

The Region relied on section 507 of the CAA and the “SIP Revision Approval Checklist for Section 507 Small Business Assistance Program” in our review of New Mexico’s SIP submittal for approvability. The checklist, developed by EPA, is included as an attachment to this Technical Support Document. The checklist fo cuses on the following topics: (1) Program implementation milestones; (2) the three principal Program el ements described above, which include (a) a Small Business Assistance Progr am, (b) a State Small Business Ombudsman, and (c) the Compliance Advisory Pa nel; and (3) additional Program elements such as (a) source eligibility and (b) fee reduction authority.

IV. Analysis of State Submittal

A. Procedural Background

The State of New Mexico has met all of the requirements of section 507 by submitting a SIP revision that provides for the implementation of all required Program elements. The New Mexico legislature amended the New Mexico Air Quality Control Act in 1992 to provide authority for the New Mexico Environment Department (NMED) to establish a Program. Specifically, Section 74-2-5 of the Act was amended to require that the NMED “establish a small business stationary source technical and environmental complian ce assistance program, consistent with the provisions of Section 507 of the federal act. ” (see NMSA Chapter 20, Section 74-2-5.1.E.)3

The State held a public hearing on October 9, 19 92, following an official 30-day public comment period that commenced on August 31, 1992, to c onsider public comments on the proposed Program. The proposed SIP revi sion was adopted on October 9, 1992, by the Environmental Improvement Board of New Mexico. The SI P revision was submitted to the EPA by the Governor of New Mexico on November 5, 1992, as a revision to the New Mexico SIP. It was initially reviewed for completeness and was de termined to be complete on January 15, 1993.

B. Plan Elements

1. Small Business Assistance Program

The first Program element is the establishment of a Small Business Assi stance Program (SBAP) to provide technical and compliance assistance to eligible small businesses. Section 507(a) sets forth six requirements 1 that the State must meet in or der to have an approvable SBAP:

The first requirement is to establish adequa te mechanisms for developing, collecting, and coordinating information concerning compliance methods and technologies for small business stationary sources, and programs to encourage lawful cooperation among such source and other persons to further compliance with the Act.

The second requirement is to establish adequa te mechanisms for assisting small business stationary sources with pollution prevention a nd accidental release detection and prevention, including providing information c oncerning alternative technologi es, process changes, products and methods of operation that help reduce air pollution.

The third requirement is to develop a complian ce and technical assistance program for small business stationary sources that assists small businesses in determining applicable requirements and in receiving permits under the Act in a timely and efficient manner.

The fourth requirement is to develop adequate mechanisms to assure that small business stationary sources receiv e notice of their rights under the Ac t in such manner and form as to assure reasonably adequate time for such s ources to evaluate compliance methods and any relevant or applicable proposed or final regu lation or standards issued under the Act.

The fifth requirement is to develop adequate m echanisms for informing small business stationary sources of their obliga tions under the Act, including mechan isms for referring such sources to qualified auditors or, at the option of the State, for providing audits of the operations of such
sources to determine the status of their co mpliance with the requirements of the Act.

The sixth requirement is to deve lop procedures for consideration of requests from small business stationary sources for modifi cation of (A) any work practic e or technological method of compliance, or (B) the schedule of milestones for implementing such work practice or method of compliance preceding any applicable compliance date, based on the tec hnological and financial capability of any such small business stationary source.

1 A seventh requirement of section 507(a), the establishment of an Ombudsman office, is discussed in the next
section.4

New Mexico met the first Program element by committing in its SIP revision, Section II, to establish an SBAP within the organizationa l structure of the New Mexico Environment Department, to be administered by a staff of two to three state technical experts, who are tasked with responding to requests for assistance from small businesses. Section II of the SIP revision
submittal describes the details a nd responsibilities of the New Me xico SBAP, which meet the six requirements set forth in sect ion 507(a) and discussed above.

2. Ombudsman Office

The second Program element is the establishment of a State Small Business Ombudsman to represent the interests of small businesses in the regulator y process. Section 507(a)(3) requires the designation of a State office to serve as the Ombudsman for small business stationary

sources.

New Mexico met this requirement by committing to establish in 1994 the Small Business
Ombudsman Office within the office of the Secretar y of the NMED, as described in Section I of
the SIP revision. New Mexico also committed to provide sufficient resources to the State Ombudsman’s Office to enable it to discharge its responsibilities effectiv ely, including adequate funding from Title V permitting fees collected by the NMED. Additionally, provisions have been made to provide the Ombudsman with direct acce ss to the government ag encies and officials, such as the Secretary of the Environment Depa rtment, the Governor’s office, the Attorney General, and others, as necessary, to ensure that the concerns of small businesses will be heard. Furthermore, the Ombudsman is vested with sufficient authority to identify and propose solutions to small business problems as they rela te to the implementation of the federal CAA.

The first Ombudsman of the NMED was appointed in December 1993.

3. Compliance Advisory Panel (CAP)

The third Program element is the creation of a CAP to direct the efforts and determine and report
on the overall effectiveness of th e SBAP. Section 507(e) requires the State to establish a CAP. The responsibilities of the CAP ar e also specified, as well as the minimum number of individuals who must comprise the CAP and how they are to be appointed.

The specific responsibilities of the CAP include:

 Rendering advisory opinions concerning the effectiveness of the State’s Program;

 Making periodic reports to the Administrato r concerning the compliance of the State’s Program with the requirements of the Paperwork Reduction Act, the Regulatory Flexibility Act, and the E qual Access to Justice Act; 2

2 Section 507(e)(1)(B) of the CAA requires the CAP to re port on the compliance of the SBAP with these three Federal statutes. However, sin ce State agencies are not required to comply with these statutes, EPA believes that the State Programs must merely require the CAP to report on whether the SBAP is adhering to the general principles of
these Federal statutes.5

 Reviewing information for small business stationa ry sources to assure such information is understandable by the layperson; and

 Having the State’s Program serve as th e secretariat for the development and dissemination of such reports and advisory opinions.

Section 507(e)(2) specifies that the CAP must be comprised of at least seven individuals, and that the appointment of these CAP members is to be distributed between the Governor, majority and minority leaders of both houses of the State’ s legislative body, and the State’s environmental protection agency (in this case, the NMED):

 Two members, who are not owners or repr esentatives of owners of small business stationary sources, are to be selected by the Governor to represent the general public;

 Two members, who are owners or represent ow ners of small business stationary sources, are to be selected by the lo wer house of the State legislat ure (one each by the majority and minority leadership);

 Two members, who are owners or represent ow ners of small business stationary sources, are to be selected by the upper house of the State legislature (one each by the majority and minority leadership); and

 One member, who is to be selected by the head of the department or agency of the State responsible for air pollution permit programs to represent the intere sts of that agency.

New Mexico met this requirement by committing to appoint the members of the CAP as outlined above, and to designate to the CAP the four responsibilities specified by the CAA.

As discussed above and in the dire ct final federal register notice, EPA has historically viewed the CAP as a necessary component of a Program, the Ag ency no longer believes that to be the case. In CAA section 507(a), Congress directed that EPA “shall appr ove” a Program if it meets the criteria outlined in section 507(a )(1)-(7). The requirement for the creation of a CAP, located in section 507(e), is not one of thos e criteria. This dis tinguishes the CAP from the requirements to designate a state office to serve as Ombudsman or to establish an SBAP , which are criteria for Program approval in CAA secti on 507(a). Although a State may subm it a CAP for inclusion as a component of its Program—and indeed, EPA still be lieves that CAPs serve an important role in the continued operational success of a Program—Congress, in loca ting the CAP requirement in section 507(e), envisioned that th e requirement to create a CAP would be severable from the Program requirements outlined in section 507(a). Accordingly, New Mexico’s withdrawal of the CAP portion of its SIP submission does not prev ent EPA from acting on the remainder of the
submission. EPA believes that New Mexic o, including Albuquerque/Bernalillo County, continues to operate a robust SBAP providing the required services to eligible small businesses.6

Eligibility of Small Business Stationary Sources

Section 507(c)(1) of the CAA defines the term “s mall business stationary source” as a stationary
source of air emissions that m eets the following four criteria:

 Is owned or operated by a person who employs 100 or fewer individuals;

 Is a small business concern as defi ned in the Small Business Act;

 Is not a major stationary source (as defined by the Act);

 Does not emit 50 tons per year or mo re of any regulated pollutant; and

 Emits less than 75 tons per year of all regulated pollutants.

The State of New Mexico has established a mechan ism for ascertaining the eligibility of a source to receive assistance under the Program, includi ng an evaluation of a source’s eligibility using
the criteria in section 50 7(c)(1) of the CAA.

New Mexico has provided for public notice and comment on grants of eligibility to sources that do not meet the provisions of sections 507(c)(1 )(C), (D), and (E) of the CAA but do not emit more than 100 tons per year of all regulated pollutants.

New Mexico has also provided for exclusion from the small business stationary source definition, following consultation with EPA a nd the Administrator of the Small Business Administration, and after providing notice and opportunity for public hearing, of any category or subcategory of sources that the State determin es to have sufficient technical and financial resources to meet the requirements of the CAA.

C. State Submittal

By cover letter dated November 5, 1992 and November 16, 1992, Governor Bruce King of New Mexico submitted SIP revisions to the EPA for the purpose of establishing a Small Business Stationary Source Technical and Environmental Compliance Assistance Program for both the State and Albuquerque/Bernalillo County. The SIP revisions were submitted by the State to satisfy the Federal mandate, f ound in section 507 of the CAA, to ensure that small businesses have access to the technical assistance and regula tory information necessary to comply with the

CAA.

The EPA has reviewed the State’s submittals and de veloped this evaluation report, or Technical Support Document. The results of this review ar e shown in the attached “SIP Revision Approval Checklists for Section 507 Small Business Assistance Program.” The checklists indicate that all required Program elements found in section 507 of the CAA are met by the New Mexico SIP
revision submittals.7

V. Conclusion

The New Mexico SIP revisions meet all the requir ements for a Small Business Stationary Source
Technical and Environmental Co mpliance Assistance Program as outlined in section 507 of the CAA. Based on this review, approval of this New Mexico SIP revisions, as submitted, is recommended. Also, included are the re view checklists for both the State and Albuquerque/Bernalillo County showing our re commended approval fo r both Programs.

VI. SIP Implementation

The SIP revision includes a schedule, which committed the State to gradual implementation of all three principal Program elements, with fu ll implementation to be achieved by November 15, 1994. The SBAP was launched in November 1994; the Ombudsman was appointed early, in December 1993; and the CAP conducted its firs t meeting in January 1995 (please note the
discussion on the CAP above and in the Fe deral Register noti ce for this action).8

SIP Revision Approval Checklist

The following pages shows the checklist that wa s reviewed by EPA in 1992 for approval of the Section 507 Small Business Assistance Program. Th e checklist indicates that State met the Program milestones by the required date. On Page 18 of this TSD, the checklist for Albuquerque/Bernalillo County indicates that Albuquerque met the Program milestones by the required date. Additional details of the entire submittal are located in the docket for this rulemaking.910111213141516171819202122232425