10- 9-02 ; 2 :43pM ; 

s°tED 314 

r~u 

, 

. Ref 8P-AR 

Board of Environmental Review 

P.O. Box 200901 

Helena, Montana 59620-0901 

Dear Board Members: 

OCT -9ME 

The purpose of this letter is to provide EPA's comments on the revisions to the State's 

rule "Permit, Construction and Operation of Air Contaminant Sources," codified in ARM Title 

17, chapter 8, subchapter 7 and other rules being revised to conform to the revised subchapter 7. 

We understand that the Board will be considering these revisions, including the adoption of new 

Rules I through XVIII, at the Board's October 10, 2002 public hearing. The enclosure to this 

letter includes our comments on the rule changes identified in the MAR Notice No. 17-165, 15-

8/15/02. 

The Clean Air Act (Act) establishes a shared responsibility between EPA and States to 

protect air quality. States adopt rules to protect air quality, including the National Ambient Air 

Quality Standards (NAAQS), and we approve the rules into the State Implementation Plan (SIP) 

if they meet the Act's requirements . The enclosed comments identify provisions in the New 

Rules that we believe we cannot propose to approve into the SIP. In most cases we have 

attempted to identify how a rule might be revised so that we could propose to approve it into the 

SIP. Additionally, our comments identify editorial corrections. 

If you have questions about these comments or if you want to discuss these issues in 

further detail, please feel free to contact me at (303) 312-6005, or have your staff contact Laurie 

Ostrand at (303) 312-6437. 

;3033126064 7t 2/ 35 

UNITED STATES ENVIRONMENTAL PROTECTION AGENCY 

REGION 8 

999 18"" STREET - SUITE 300 

DENVER, CO 80202-2466 

Phone 800-227-8917 

http :1lwww.epa .govlregion08 

Enclosures 

cc: John Wardell, 8M0 

Don Vidrine, MDEQ 
10- 9-02 ; 2 :43PM ; ;3033728064 7A 3/ 35' 

Enclosure 

A. SIP Approvability Comments 

(1) New Rule XI - We have had, and continue to have, a concern that the permitting rule only 

provides for a 15 day public review of preliminary determinations on permits. As we have 

indicated before, we believe this timeframe is too short for the public and EPA to provide 

comments, particularly for complex permitting actions. Given these concerns, and the discussion 

below, we believe it is in the State's best interest to revise the public comment period to 30. days. 

Since we previously approved the 15-day comment period, it may be helpful if we 

describe the basis for our current concerns . We originally approved the 15-day comment period 

into the SIP over 20 years ago. Although our regulations normally require that SIPs include a 30-

day comment period for permit actions, our rules also allowed us the discretion to approve a 

shorter comment period where existing State regulations already included a comment period less 

than 30 days. See 40 CFR 51,161(b) and (c). We exercised this discretion in approving 

Montana's ,15-day comment period . However, in the intervening years this shortened comment 

period has caused us problems on a number of occasions. We have found it difficult to supply 

adequate review and comment to the State on preliminary permit determinations, particularly 

when complex issues have been involved or when we have had misunderstandings with the State. 

Given our own difficulties, we have also questioned whether this abbreviated comment period 

would provide an adequate opportunity for comment to other affected States and federal agencies 

and the public. Thus, when the Board proposed revisions to the permitting rules on February 14, 

2002, we took the opportunity to express our concerns regarding the 15-day comment period and 

ask that it be lengthened to 30 days. See our April 2, 2002 letter . The proposed revisions- do not 

address our concerns, and thus, we are reiterating our request. 

As you are probably aware, we also recently received a petition from Environmental 

Defense and Land and Water Fund of the Rockies that, among other things, alleges that the 15-

day comment period is inadequate and demands tl4t EPA issue a SIP call requiring the State to 

revise the comment period to at least 30 days. We have made no decision yet regarding this 

request for a SIP call or any other aspect of the petition . We intend to complete a thorough' 

evaluation of the issues raised by the petitioners over the coming weeks, but your current 

rulemaking offers the opportunity to resolve one of the petitioners' concerns, and our coincident 

concern, in the near term. We think such a resolution would be beneficial to all involved. 

Incidentally, we are under the impression that the 15-day comment period may be 

considered necessary due to the Montana statutory and regulatory requirement that a final 

decision be made within 60 days of receipt of a complete permit application. On the one hand 

we do not believe this time constraint should dictate the length of public comment period ; it is 

essential that adequate opportunity for public comment be provided regardless of State-imposed 

deadlines on permit issuance. On the other hand, as we have considered this matter, we have 

begun to question whether 60 days is an adequate amount of time to issue complex permitting 

actions. EPA's rules only require that a preliminary determination on a PSD permit be issued 
10- 9-02 ; 2 :43PM ; ;3033126064 YR 4/ 35 

within one year after receipt of a complete permit application (see 40 CFR 51 .166(q)), and our 

experience indicates that permit applications often raise complex issues that require significantly 

more than 60 days to adequately address. We recognize that a change to the 60-day period may 

require legislative action, but we thought it best to raise the issue now so that we can begin to 

explore the issue more fully and determine whether a change should be pursued. 

(2) We believe the New Rules -donot clearly. indicate how they apply to major source permitting . 

Because of this, we believe we could not propose to approve several definitions and provisions of 

the New Rules, mentioned below, because these defiinitions and provisions would be inconsistent 

with requirements for major source permitting . We believe we could propose to approve these 

definitions and provisions if they were revised to indicate that they do not apply to sources 

subject to subchapters 8, 9 or 10. We suggest subchapter 7 be amended to provide this 

clarification. 

(a) New. Rule II(14) - definition of "Routine maintenance, repair, or replacement." For 

major source permitting we see the determination of routine maintenance, repair, or 

replacement as a case specific process and one that cannot be generally defined. Based 

on our past determinations, routine activity has a narrow scope and should generally be 

applied only to actions that are regular, customary, repetitious, and undertaken as standard 

practice to maintain a facility in- its present condition. The determination of whether a 

proposed modification is "routine" is a case-specific determination which takes into ' 

consideration the nature, extent, puzrpose, :ffequency and cost of the work, as well as any 

other relevant factors. See Memo from Don R. Clay, Acting Assistant Administrator for 

Air and Radiation, to David A. Kee, Director, Air and Radiation Division, Region V, 

September 9, 1988, enclosed . We believe that the State's proposed definition for "routine 

maintenance, repair, or replacement" does not assure that all appropriate factors are 

considered in determining whether or not a proposed project is considered to be routine 

maintenance, repair or replacement and, subsequently, is exempt from permitting 

requirements for modifications. . 

(b) New Rule II(2) - definition of "Construct" or "construction.' 'This definition includes 

the phrase "a reasonable period of time for startup and shakedown." Because of this 

phrase, New Rule II(2) is not consistent with the same term used in major source 

permitting . See ARM 17.8 .801(10), ARM 17.8 .901(6) and 40 CFR 51 .166(b)(8) . 

(c) New Rule TV(1)(f) - general exclusion for emergency equipment installed in 

industrial or commercial facilities . Since there are no restrictions, on the size, emissions, 

or duration of time emergency equipment may be used, emergency equipment excluded 

from permitting in Subchapter 7 maybe a major source and subject to major source 

permitting. 

(d) New Rules VII(2) and XIII(2) - These-provisions allow for a 5 year extension of a 

specified effective date in a permit or a 3 year upper limit on the expiration date of a 

permit for not constructing or installing, respectively. The Federal PSD requirements in 

3 
10- 9-02 ; 2 :43PM ; " ;3033126064 tA 5/ 35 

40 CPR 52.21(r)(2) specify that a PSD permit will expire after 18 months if construction 

is not commenced within 18 months . 

(3) New Rule V - exclusion from permitting for de minimis changes. We are concerned that the 

rule could allow sources to violate major and minor source preconstruction permitting , 

requirements, as well as the State Implementation Plan. We identified these concerns in prior 

correspondence! We believe we cannot propose to approve New Rule V unless changes are 

made and additional infornmation identified below is provided . New Rules (II)(8), (X)(1) and 

XV(1)(b) also refer to New Rule V.' We believe we also cannot propose to, approve New Rules 

(Ii)(8), (X)(1) and XV(1)(b) unless the changes identified below are made to New Rule V. 

(a) Change New Rule V(1)(a) to read: (a) Construction or changed conditions of 

operation at a facility for which a Montana air quality permit has been issued that do not 

increase the facility's potential to emit by more that 5 +5 tons per year ~ of any pollutant.-

except. x2 tons per year of lead , except :" . . 

(b) Change New Rule V(1)(a)(i) to read: (i) any construction or changed conditions of 

operation at a facility that would violate any condition in any statute, the facility's 

existing Montana air quality permit, or any applicable rule contained in this chapter., or 

the State Implementation Plan (SIP)~is prohibited, except as allowed in (2); 

(c) Change New Rule V(1)(d) to read: (d) If a notice is required under (1)(b), the owner 

or .operatar shall submit the following information to the department in writing at least 10 

days prior to. construction staitup-oruse of the proposed de minimis change or as soon as 

reasonably practicable in the event of an unanticipated circumstance causing the de 

minimis change: - . 

(d) Change New Rule V(2) to read: (2) A Montana air quality permit may be amended 

pursuant to [NEW RULE XV], for changes made under (1)(a)(i) that would otherwise 

violate an existing condition in the permit. Conditions in the permit concerning emission 

limits or production limits in lieu of emission limits control equipment specifications, 

operation procedures, or testing, monitoring, record keeping, or reporting requirements 

may be modified if the modification does iiot violate any statute, rule, or the state 

implementation plan, or-BACT/LAER requirements for major or minor sources. 

'On February 12, 1999 we sent a letter to Don Vidrine and on April I and May 13, 1999 

we sent letters to the Montana. Board of Environmental Review expressing concerns with the De 

Minimis Rule . Copies of these letters are enclosed. 

'The value of "x" should be at some level below the significance level of lead for major 

stationary sources, i.e., 0.6 tons per year. 
10- 9-02 ; 2 :43PM ; ;3033126064 YA 6/ 3s 

(e) Finally, pursuant to 40 CFR 51 .160(e), the State should also submit information 

regarding the basis for the exemption, and demonstrate that compliance with the NAAQS 

vvill not be compromised under this rule . 

(4) New Rule VII(5) - "state-only" conditions in a Montana Air Quality Permits. Currently, 

terms and conditions set forth in permits issued under a SIP-approved permit program (e .g ., 

permits issued under subchapter 7) are federally enforceable. Before we could propose to 

approve a provision that changes the SIP-approved permit program to allow for inclusion of 

permit terms that are non-federally enforceable a justification as to why certain provisions do not 

warrant federal (and citizen) review and enforceability would need to be submitted with the rule 

revision. Additionally, the State should demonstrate in the submittal that the proposed State-only 

terms will not hamper the ability of the State to enforce the SIP approved aspects of the NSR 

permits. We question what types of provisions in these particular permits the State would 

consider as not federally enforceable. Without more details on how this particular program 

change would be implemented so as to ensure continued compliance with all provisions in the 

SIP, we have potential backsliding concerns (section 110(1) of the Act) with this provision. 

(5) New Rule III (subsections (2)-(5)) allows certain construction activities prior to receiving a 

permit . Based on EPA's existing rules and policies, we do not believe we could propose to 

approve New Rule IIT (subsections (2)-(5)) as written. Specifically, we believe these provisions 

are inconsistent with section 110(a)(2)(C) of the,Clean Air Act and 40 CFR 51 .160, including 40, 

CFR 51 .160(b), which requires States have legally enforceable procedures to prevent. 

construction or modification of a source if it would violate any SIP control strategies or interfere 

with attainment or maintenance of the NAAQS. ' 

We were provided a table entitled "States Allowing Pre-Permit Construction ." The table 

identifies several states with rules that allegedly allow pre-permit construction activities . After 

examining the rules from the other States identified in the table, we do not believe the table 

supports New Rule III, subsections (2)-(5), as a SIP-approvable rule. Three of the states (Idaho, 

Michigan and Utah) require administrative approval by the State before construction can begin 

(Idaho's DEQ issues written approval to the source that makes potential to emit limits requested 

by the source enforceable, Michigan's Commission may grant a waiver from the construction 

permit prior to full construction approval, and Utah's executive secretary,issues an "approval 

order" (a permit) prior to construction) . Minnesota's rule only applies to "de m;*,;* ; s" permit 

modifications (the rule includes pollutant thresholds for the criteria pollutants), and New Jersey's 

rule only allows pre-construction if not prohibited by Federal Law (N.J . Admin. Code 7 :27-

223(oo)(2)). Oklahoma's rule pertains to major source operating permits (Title V). The 

Oklahoma rules contain numerous restrictions and limitations to ensure the minor permit 

modifications do not violate any SIP control strategies or interfere with attainment or 

maintenance of the NAAQS (OAC 252:100-8-7 .2(b)(1)(A)(I)(I-V) . Regarding.the North Dakota 

rule cited, we plan to research its implications . 
10- 9-02 ; 2 :43PM ; ;3033126064 0 7/ 35 

(6) New Rule XIV all ows.the state to "revoke a permit or any portion of a permit upon written 

request of the permittee, or for violation of any requirement. . ." We are concerned that applicable 

provisions may be inadvertently revoked at the request of the permittee. We believe we could 

propose to approve the rule if it were revised to indicate that permittee initiated revocations may 

be approved provided that the provisions revoked are not applicable requirements of subchapters 

7,8,9or10. 

(7) New Rule XVI(3) - allows a permit transfer of ownership and/or location to be deemed 

approved if the department does not approve, conditionally approve or deny a permit transfer 

within 30 days of receipt of a notice of intent. We are concerned that a source may 

inappropriately locate in an area and jeopardize attainment of the NAAQS. The permit transfer 

may be deemed appioved if the department does not act within 30 days. We believe we could 

propose to approve New Rule XVT(3) if it were revised to read: ". . .the transfer is deemed 

approved, except for transfers of locations to areas where a source could cause or contribute to 

violations of the NAA4S_." 

(8) Several provisions of the New Rules appear t(> be a relaxation of the existing rules in the SIP . 

Before we could propose to approve these revisions the State will need to submit an analysis 

showing that the relaxations will not interfere with attainment and reasonable further progress, or 

any other applicable requirement of the Clean Air Act (Act). See section 110(1) of the Act. 

Specifically: 

(a) In New Rule II(1), the definition of Best Available Control Technology (BACT), the 

State proposes to change "shall" to "may." This change is inconsistent with the federal 

definition of BACT (40 CFR 51 .166(b)(12)) . One potential way to address this concern 

is to revise New Rule II(1) to indicate that it does not apply to major source permitting. 

(b) New Rule III(1)(b) requires a permit for "asphalt concrete plants, mineral crushers; ; 

and mineral screens that have the potential to emit more than 15 tons per year of any 

airborne pollutant, other than lead, that is regulated under this chapter." The existing 

ARM 17.8 .705(1)(o) requires a permit for these same sources with a potential to emit 

more than S tons per year. We believe replacing a rule that requires sources emitting 

more than 5 tons per year to obtain a permit with a rule that requires permitting for 

sources emitting more than 15 tons per year is a relaxation of the existing SIP. 

(9) New Rule I1(6) - definition of "Facility ." We are concerned that the phrase "that contributes 

or would contribute to air pollution" may notbe as restrictive as the phrase "that emits or has the 

potential to emit air pollution." We are concerned that someone may emit air pollution but 

believe they do not contribute to air pollution. Therefore, we believe the phrase "that contributes 

or would contribute to air pollution" should be replaced with "that emits or has the potential to 

emit air pollution." 

(10) New Rule XV allows administrative amendments to permits. New Rule (1)(b) allows 

amendrnents to permits so long as there is no increase in emissions . We are concerned that even 
10- 9-02 ; 2 :43PM ; ;3033i26064 

though there may not be any increase in emissions some permit amendments should receive 

public review. With respect to administrative amendments that do not impact the emission limit, 

we believe our concern could be addressed and we could propose to approve this provision, if it 

were revised to indicate that "The department may amend a Montana air quality permit, or any 

portion of a permit, provided the amendment does not violate any requirement of an app icable 

. statute. rule or State Implementation Plan or effect the enforceability of an emissions limit, for 

the following reasons :" Changes that could effect the enforceability of an emissions limit 

include, for example, changes in testing and-monitoring methods, frequency of testing, and 

reporting requirements . However, we want to clarify public review requirements for 

administrative amendments for changes in operation that result in decreases in emissions. We 

believe that any amendment to decrease an emissions limit, for example, to create a synthetic 

minor or to avoid other requirements, should go through public review for the limit to be 

federally enforceable. We understand that the DEQ may be using the administrative amendment 

provisions to decrease emission limits. If this is the case, in addition to the changes mentioned 

above, additional changes should be made to the rule-to ensure that decreases in emission limits 

go through public review and thus become federally enforceable. 

B. Editorial Comments 

1 . New Rule II(8)(a) and (c), we believe the reference to New Rule IV -should be to New Rule V. 

2. New Rule I1(8)(b), we believe the reference to New Rule II should be to New Rule IIl. 

3. New Rule IV(1)0), we believe the reference to ARM 17 .8 .110(7) should be changed to ARM 

17.8 .110(7) through (9). 

4. ARM 17.8 .110(9), we believe the reference to (7)(a) should be changed to (7)(a) and (b). 

5. ARM 17. 8.818 and 17.8 .1004, we believe the references to New Rule IV should be changed 

to New Rule IV and V. 

6. ARM 17.8 .1004, there are two references to ARM 17.8 .710 being removed from this rule . 

We believe one of the references to ARM 17.8 .710 should be~revised to ARM 17.8 .720 . 
Ref: 81 .1-AR 

UNITED STATES ENVIRONMENTAL PROTECTION AGENCY 

REGION 6 

999 18?" STREET - SUITE 300 

DENVER, CO 80202-2466 

Phone 800-227-8917 

http :Ilwww RECEIVED 

.epa.govlregion08 

Board of Environmental RcvieNN, 

P.O. Box 200901 . 

Helena, Montana 59620-0901 

Dear Board Members : 

APR - 2 2002 APR 0 9 2002 

BOARD OF 

ENVIRONMENiAL REVIEW 

The purpose of this letter is to provide EPA's comments on the revisions to the State's 

rule "Permit, Construction and Operation of Air Contaminant Sources," codified in ARM Title 

17, chapter 8, subchapter 7. We understand that the Board will be considering these revisions, 

including the adoption of new Rules I through XVII, at the Board's March 27 . 2002 public 

hearing . The enclosure to this letter includes our specific comments on tile rule changes 

identified in the MAR Notice No. 17-156, 3-2/14102 . 

Our comments are arranged so that we first identify those provisions of subchapter 7 that 

appear to have SIP approvability issues . We later identify other provisions where 'Ne reconvrnend 

changes to a rule, for example, to make it clearer or more complete . The SIP approvability issues 

are discussed in detail in the enclosure and pertain to the following : definitions ; an earlier 

submitted De Minimis rule ; State-only conditions in construction permits; general exclusion for 

emergency equipment ; exemption for drilling rig stationary engines, availability of material for . 

public comment; extensions in permit conditions or long expiration dates for construction 

permits ; revocation of parts of a permit ; transfer of a permit ; and relaxations to existing rules. 

If you have questions about these comments or if you want to discuss these issues in 

further detail, please feel free to contact me at (303) 312-6005, or have your staff contact Laurie 

Ostrand at (303) 312-6437 . 

Enclosures 

cc: John Wardell . 8M0 

Don Vidrinc, MDLQ 

1"4) Printed on Recycled Paper 
Enclosure 

(A) Provisions of the New Rule Nre believe Nve cannot approve or cannot I;uaratntce Ivc will 

approve for reasons identified beloW: 

(1) New Rule 1(14) - dclinition of"Routinc maintenance, repair, or replacement" : [a'A does not 

have a definition for "routine maintenance. repair, or replacement" in our regulations. Rather, we 

see the determination of such an activity as a case specific process and one that cannot be 

generally defined . Based on our past determinations, routine activity has a narrow scope and 

should generally be applied only to actions that are regular, customary, repetitious, and 

undertaken as standard practice to maintain a facility in its present condition. The determination 

of whether a proposed modification !s "routine" is a case-specific determination which takes into 

consideration the nature, extent, purpose, frequency and cost of the work, as well as any other 

relevant factors . See Memo from Don R. Clay, Acting Assistant Administrator for Air and 

Radiation, to David A. Kee, Director, Air and Radiation Division, Region V, September 9, 1988, 

enclosed . We believe that the State's proposed definition for "routine maintenance . repair . or 

replacement" does not assure that all appropriate factors are considered in determining whether 

or not a proposed project is considered to be routine maintenance, repair or replacement and, 

subsequently . is exempt from permitting requirements for modifications . For these reasons. Nve 

believe we cannot approve this definition as a SIP revisions . We believe the State should remove 

the definition and rely on case-by-case determinations . 

(2) New Rule IV replaces earlier De Minimis Rule provisions the State adopted and submitted to 

EPA. We have not acted on the earlier De Minimis Rules provision. On February 12, 1999 we 

sent a letter to Don Vidrine and on April 1 and May 13, 1999 we sent letters to the Montana 

Board of Environmental Review expressing concerns with the De Minimis Rule. New Rule IV 

has not been revised to address our earlier concerns . Our earlier concerns still stand . We cannot 

guarantee that we will be able to approve the New Rule IV . Copies of the three referenced letters 

are enclosed. Other provisions of the New Rule refer to New Rule IV, For the same reasons 

mentioned above, we cannot guarantee we will be able to approve portions of other provisions 

that reference New Rule IV. See New Rules (1)(8) (i .e,, reference to New Rule IV in definition 

of modify), (IX)(8) (i .e ., reference to "except as specifically provided in this subchapter"), and 

XIV(1)(b) (i .e ., provisions that allow administrative amendments for changes in operation that 

result in emission increases and that meet the criteria of New Rule IV(1)(a)) . 

(3) New Rule VI(5) is a new provision which allows the State to specify "state-only" conditions 

. in a Montana Air Quality Permit which would not be considered federally enforceable 

conditions . While it may be acceptable to include "state-only" provisions in Title V permits, all 

terms and conditions set forth in permits issued under a SIP-approved permit program (c .g ., 

permits issued under subchapter 7) are federally enforceable. If the State is proposing to change 

its SIP-approved permit program to allow for inclusion of permit terms that are non-federally 

enforceable (including terms in minor NSR, major nonElltainnlent NSR, IISD, and federal]), 

enforceable state operating permits (1:(:SOPs) issued pursuant to SIP-apprcmvcd operating permit 

prot;rarns), a .justiiication as to why certain provisions do not warrant federal (and citizen) review 
and enforrrtlbility wOuld rlrrLl Ici lie tilll)llllllcd wilh the rule revision . We question whal types of 

provisions in thcsc particular permits (lie State would considcr as not fcdcrally cnliorceublc . 

VVithout more drtails oil how this parlicular program change would be inlplenic:ntcd so as to 

ensure continued compliance with all provisions in the Sill . we have potential backsliding 

concerns (section I 10(I) of tile Act) with this provision and we believe we cannot approve such a 

change. 

(4) New Rule lIl(1)(f) - general exclusion for emergency equipment installed in industrial or 

commercial facilities . We believe we cannot approve a provision that provides an exclusion for 

emergency equipment at such facilities . A source would need to get a permit for ally such 

equipment. Under extenuating circumstances, enforcement discretion may be cmployed by the 

State/CPA/public if justified but, in general, the facility should have preplanned emergency 

backup and that equipment should have an appropriate permit. 

(5) New Rule lIl(1)(i) - We question ]low the State will assure that a de minimis level of 100 tons 

per year for drilling rig stationary engines and turbines will not cause or contribute to violations 

of the NAAQS per 40 CFR 51 .160(a)(2). We also question how this exemption will assure 

compliance with any applicable MACT requirements. If the source is a new major source. then 

the case-by-case MACT (required by CAA I l 2(g)) would apply. Also, tile source may be subject 

to the (upcoming) MACT requirements for Combustion Turbines or the (upcoming) 

requirements for Reciprocal Internal Combustion Engines. Because of these concerns, we 

believe we cannot approve this rule. 

(6) New Rule X(4)(a) - EPA rules require that opportunity for public comment shall include, as a 

minimum, "availability for public inspection in at least one location in the area affected of the 

information submitted by the owner of operator and of the State or local agency's analysis of the 

effect on air quality." (40 CFR 51 .161 (b)(1)) . We believe we cannot approve this provision 

unless New Rule X(4)(a) also requires that a copy of the application and tile Department's 

analysis of the application be made available for public inspection in the air quality control 

region where the source or stack is located, as is currently required in ARM 17.8 .720(2)(c)(i). 

(7) New Rules VI(2) and XI1(2) - These provisions allow for a 5 year extension of a specified 

effective date in a permit or a 3 year upper limit on the expiration date of a permit . respectively. 

The upper limits in both cases are too long and the provisions in VI(2) and XII(2) appear to 

conflict with each other. We believe the State should require that the source update its BACT 

determination . air quality analysis and any netting analysis before extensions are granted and 

construction begins. The Federal PSD requirements in 40 CFR 52 .21(r)(2) specify that a PSD 

permit will expire after 18 months. We believe we cannot approve this provision unless the rule 

requires an updated BACT determination, air quality analysis and netting analysis after 18 

months and before the permit expires or (lie extension is granted . (See EPA's phased 

construction requirements in 40 CFIZ 51 .166(j)(4)) . 

(8) New Rule X1II allows the state to "revoke a permit or urtphnrliun nfupermit upon written 

request uf tlle pcrmittee, or for violation of any requirement. . ." We question ]low the Department 
%A-ill evaluate a rcqucst From a hermittre to revoke part of a permit. For example, can a hcrnlittce 

request revocation of ccrtain rnonitoring or rccordkeching rcquiremernts that are used for 

compliance demonstration? \\'ilhuut sOmc more dclinite critcria for what type orparlial 

revocations would be acceptable so as to ensure that all applicable requirements are met, we 

cannot guarantee that we would approve such a provision. Additionally, we believe that these 

partial revocations would not be minor administrative changes and would need to go through 

public review as we)) . 

(9) New Rule XV(3) adds a new provision that allows a permit transfer to be deemed approved if 

the department does not approve, conditionally approve or deny a permit transfer within 30 days 

of receipt of a notice of intent . ~ Forty CPR 51 .160(b) requires the State to make an affirmative 

decision on whether or not to issue a permit (or in this case on whether or not to approve a permit 

transfer) . \\'e believe the new provisions added in New Rule XV(3) are not consistent with 40 

CFR 51 .160(b) and we believe we cannot approve them . 

(10) In several provisions of the New Rules appear to be a relaxation of the existing rules in the 

SIP . We believe we cannot approve such revisions unless the State can demonstrate that such 

revisions are not inconsistent with section 1 10(l) of the Act. Specifically : 

(a) several places the New Rule indicates that something "may" be done or required 

whereas the existing rules indicates "shall ." We believe replacing "shall" with "may" is 

a relaxation of the existing rule . See New Rules I(1), IX(3), Xll(2) . 

(b) New Rule 11(1)(b) requires a permit for "asphalt concrete plants, mineral crushers, and 

mineral screens that have the potential to emit more than 1 5 tons per year of any airborne 

pollutant, other than lead, that is regulated under this chapter." The existing ARM 

17 .8 .705(l)(o) requires a permit for these same sources with a potential to emit more than 

5 1ons per year-. We believe replacing a rule that requires sources emitting more than 5 

tons per year to obtain a permit \ti~ith a rule that requires permitting for sources emitting 

more than 15 tons per year is a relaxation of the existing SIP, 

(c) New Rule 11(1)(d) indicates that a facility installed before November 23, 1968 and that 

modifies after that date does not need to receive an air quality permit if the modification 

does not increase the potential emissions by more. than 25 tons per year of an), regulated 

air pollutant . We find this rule confusing because New Rule 1V only excuses 

modifications from permitting if the potential emission increases are less than 15 tons per 

year (although, as noted below, we previously identified concerns with New Rule IV). 

Additionally, we do not find that the existing permitting rules contain provisions similar 

to New Rule I1(1)(d). Therefore, we believe New Rule I1( I )(d) is a relaxation of the 

existing SIP. 

(d) Ne~~~ Rule 111(1)(g) - general exclusion for activities or cquipmcnt associated \vitlh (lie 

construction. maintenance, or use of roads except emitting units for which a permit is 

required under New Rule Il( I )(b) or (c) . ']'his provision is similar to the existing rule at 
ARM 17.8 .705(1)(i). I Irrwcvrr. i1 appears that New Rule 111(1)(fi) is a rclcrxatiun of what 

is rcquircd in ARM 17.8 .705( 00). 

B. Other General Concerns and Recommendations for Changes to the New Rule 

(1) New Rule X - We have had, and continue to have, a concern that the permitting rule only 

provides for a 15 day public review of preliminary dctermiriations on permits . We believe this 

timeframe is too short for the public and EPA to provide comments. Because the 15-day public 

review timeframe starts when the preliminary determination on a permit is mailed . and it usually 

takes a week for us to receive the proposed permit, we often have only a week or less to review a 

draft permit and submit comments to the Department . We assume other members of the public 

must also experience a time crunch when reviewing draft permits . 

Forty CFR 51 .161(b)(2) indicates that opportunity for public comment shall include, as a 

minimum, "a 30-day period for submittal of public cornments." We have contemplated issuing a 

SIP Call to the State to require the public comment period on permits be extended to 30-days. 

We believe the State should revise its rules now to lengthen the public comments period to 30-

days. 

(2) In general, it is not clear how New Rules 1 through XVII integrate vdth the other applicable 

permitting requirements in subchapters 8 (Prevention of Significant Deterioration of Air 

Quality), 9 (Permit Requirements for Major Stationary Sources or Major Modifications Locating 

Within Nonattainment Areas) and 10 (Preconstruction Permit Requirements for Major Stationary 

Sources or Major Modifications Locating Within Attainment or Unclassified Areas). 1t is our 

understanding that the requirements in new Rules I through XVII would apply to all sources 

needing a permit, in addition to any applicable requirements in subchapters 8, 9, and 10, however 

that is not explicitly clear. It appears that the provision in the existing ARM 17 .8 .704(l), which 

explains the intent of subchapter 7, is not reflected anywhere in the new rules . We believe the 

New Rules should make it explicit that (lie requirements in subchapters 8 . 9, and 10 for major 

sources apply in addition to the requirements in new .Rules I through XVII. 

(3) Currently, other subchapters in ARM Title 17, refer to the existing codification of subchapter 

7. These other subchapters will need to be revised to reference the new codification of 

subchapter 7. 

(4) New Rule 1(1) - definition of "Best Available Control Technology (BACT)": For 

consistency and clarity, we, believe the term "emitting unit or modification" should be replaced 

with the term "new or modified emitting unit." as defined in New Rule 1(11). 

(5) New Rule 1(2) - definition of "Construct" or "construction" : Including a "reasonable period 

of time for startup and shakedown" is not consistent with the definition of"Construction" in 

ARM 17.9 .801 (10). ARM 17.8 .901(6) and 40 CT-R 51 .IG6(b)(8). Since the dcf-Initions ill this 

subchaptcr apply to till sources. including those subject to the permitting requirements in 

subchapters 8 and 9, we bclicve the definitions in this section should be consistent with the 

5 
dcfinition in subchapters 8 and 9 and shOuld not include startup and shakedown. 

(6) New Rule 1(4) - definition U1~"1.'.Illlttlnb' unit": In order to cover both new and modified unit%, 

we believe the definition should include "any equipment that emits or has ihelwtenflal to emit 

." . EPA also believes the definition should specify "any regulated pollutant under the C7cun AilAct" for clarity. 

(7) New Rule I(6) - definition of "I'acility" : Tile phrase '*that contributes or would contribute to 

air pollution" in this definition is vague. We believe the phrase "that enlits or has the potential to 

emit any air pollutant subject to regulation under the Clean Air Act" is more clear and consistent 

with other defined terms in this subchapter . 

(8) New Rule III(] )(k) - This exemption is redundant since the definition of "inodify" includes 

an exemption for routine maintenance, repair or replacement . We believe this exemption should 

be deleted . 

(9) New Rule VI(1) - We believe the last sentence should also reference conditions necessary to 

assure compliance with the Federal Clean Air Act. 

(10) We do not see where ARM 17 .8 .710(5) has been addressed in the New Rules. We believe 

that this provision should be included in New Rule V1. 

(11) New Rule VII(l )(b) - A reference to ARM Title 17, chapter 8, subchapter 10 ' 

(Preconstruction Permit Requirements for Major Stationary Sources or Major Modifications 

Locating Within Attainment or Unclassified Areas), in addition to subchapter 9, should also be 

included in this provision. 

(12) Like the existing codification (ARM 17.8 .733), New Rule XIV only allows the permittee, 

and not the public nor EPA, the ability to challenge the permit amendments issued by tile 

Department. We believe the rule should be revised to allow EPA and the public the ability to 

request a hearing before the Board. 

(13) New Rule XV(l )(c)(i) should also reference the Federal Clean Air Act. 

(14) Nevv Rule XV(l)(d) should also reference ARM Title 17, chapter 8, subchapter 8. 

C. Provisions Historically Not Submitted as SIP Revisions 

The State has historically not submitted some rule provisions as SIP revisions . We are assuming 

the State intends to keep the following provisions as State-only provisions and are therefore not 

providing comments on them : New Rule XVI(1)(6) (ARM 17.8 .702(1)(f)) . New Rule XVII 

(ARM 17.8 .706(5)) . and New Rule 1(10) . 

6 
10- 9-02 ; 2 :43PAA ; ;3o33126064 # 21/ 35 

UNITED STATES ENVIRONMENTAL PROTECTION AGENCY 

' REGION 8' 

99918T"STREET - 'SUITE 500 

. ' DENVER, CO 80102-2466 

Ref 8P-AR ' FEB 1 2 f999 

Don Vidrine, Chief 

Air and Waste Management Bureau 

Department of Environmental Quality 

P.O, Box 200901 ' 

Helena, Montana 59620-0901 

Dear Don: 

The purpose of this letter is to provide EPA's cornments on the State's "de minimis rule," 

codified in Sections 17 .8 .705 and 17.8 .733 of the Administrative Rules of Montana (AR1VI) . We 

understand that the State is planning to publish a notice for revisions to this rule within the next 

week and to conduct the public hearing on these rules changes before the Montana Board of 

Health and Environmental Sciences at its March 24, 1999 meeting. EPA provided comments on 

the State's initial de minimis rule in a letter dated July 25,.1996, in which EPA expressed some 

concerns about the types of changes at existing sources the State was exempting from State and 

public review. In the draft revisions to its de minimis rule, it appears that the State is expanding 

on the exemptions from new source review (NSR) permitting requirements while, at the same 

time, adding some safeguards to the process. 

Background -New Source Review Requirements and A!o_wableg&e_mLtions 

;~7~ ]~*i-Montana,'4j"* ~ b erofSA t tis 

NSR programs to exempt certain minor modifications- at eidsting sources either from public 

review and comment (or to provide for less than a 30-day public comment period) or from NSR 

review altogether as- Montana is proposing. EPA realizes there are various reasons for these types 

of program revisions, the -most pressing of which seems to be the additional permitting 

requirements .of~e.g .art. .70 operati,pg pern~r~t pyog~tn,._ Qn t1~,e_othvr .hand.}t.h_.re_Wa iqgWatory. . . ' . . 

and statutory mandate for minor NSR programs, and EPA needs to ensure that any revisions to: 

State's NSR programs do not compromise those Federal requirements. In addition, there has, 

been a rising concern with fauhy implementatian of the prevention of significant deterioratioin . 

(PSD) and nonattainment NSR permitting progranps, especially in determining applicability of. 

major source/major rnodifcation permitting requirements. Reducing the scope of change s that. are 

reviewed by permitting agencies under minor NSR programs may add to this problem . . 

EPA's regulations regarding niinor NSR programs are found at 40 CFR 51 .160-164 and 

were promulgated pursuant to section 110(a)(2)(C) of the Clea3z Air Act (Act). The regulations 

require that State Implementation Plans (SIPs) include measures to determine whether the 

construction or modification of a facility, building, structure, or installation will result in a 

violation of the applicable portions of the State's control strategy or interfere with attainment or 

maintenance of the national ambient air quality standards (NAAQS) in the State or in a 

neighboring State. The State must be able to prevent construction or modification in such cases. . 
10- 9-02 ; 2 :43PM ; . ;3033126064 # 22/ 35 

(See 40 CFR 51.160(a) and .(b) .) Thus, in reviewing any exemptions to a State's minor NSR 

. 

program, EPA must be assured that the exemptions would not interfere with the basic 

requirement to ensure that new and modified sources do not cause or contribute to a violation of 

the NAAQS or violate the SIP. 

In addition, 40 CFR 51 .161 requires that States' NSR programs provide for opportunity 

for public review and comment on the information submitted by the owners and operators and the 

State's analysis of the effect of the proposed construction or modification on air quality. 

Currently, these Federal regulations do not provide for exemptions from the public participation 

requirements. A strict reading of EPA's regulations would require that all sources subject to a 

State's permitting requirements also be subject to these public participation requirements . . 

On August 31, 1995, EPA proposed revisions to the requirements in 40 CFR 51 .161 in . 

conjunction with proposing revisions to 40 CFR part 70 (see 60 FR 45530-71). Specifically, EPA 

proposed to allow States' NSR programs to vary the public review procedures and faring for 

some construction or modification activities in light of the environmental significance of the 

activity ('mcluding foregoing public review altogether for some changes that have been approved 

by EPA- as "de minimis"). However, EPA's proposed rules provide that States' NSR programs 

must meet the public participation requirements of 40 CFR 51:161(bx2) for all new major 

stationary sources or major modifications subject to PSD or nonattainment NSR permitting . 

requirements, as well as for any physical change or change in the method of operation of a part 70 

source where the prospective emissions increases.from such change would be a significant 

emissions increase of any pollutant subject to regulation under part C or D of the Act (i.e ., for 

cbangesat sources that are "netting out"ofmajor modification review). 

, The:~ F~ariibie oftlii5~ o .osec~~~rvie .couta'vns~EPA's~most reeet~ . . ., p . . Pr p . p~ . . . . . 

. purposes of the mirior NSR program, the process for exemptizng sources from review,~ and~ the : 

types of modifications that could un,dergo less thin fiill public participation requirements . In that ' 

notice, EPA discussed how, under 40 CFR 51.160(e), States can restrict the scope of facilities, 

buildings, structures, Dr-installations that are subject to- .review, although the SIP must~discuss the 

. .,basis for such decision. .EPA stated that States may exempt from minor NSR those changes that . 

: are not environmentally significant, consistent with the ~de.minimis exemption criteria-set forth in 

AlabarnaPawer Co. v ~Costle, 636 F.2d 323, 360-361, 405 (D. C. Cir. 1979). "EPA also discussed 

the types of sources and modifications EPA would not likely consider as de minimis. Those 

included synthetic minor sources and netting transactions (i_e ., when a source proposing a 

modification obtains "internal offsets" such that its net emissions increase is 'less than the major . 

modification significance levels). In both of these permitting situations, the source is trying to 

obtain Federally enforceable limitations on its emissions. ~ Thus, whenever a source is trying to 

obtain Federally enforceable limits, EPA's position is that those emission limitations must go 

through at least some level of public participation . In the August 31, 1995 preamble, EPA stated . 

that since States can exempt de minimis changes from minor NSR altogether, it follows that 

States may provide a full or partial exemption from the public participation requirements of 40 

CFR 51.161, consistent with the environmental significance of the change . Consequently, EPA 

. r~)' 5.~. .. 
io- 9-02 ; 2 :43PM ; ;3033726064 0 23/ 3s 

proposed revisions to 40 CFR 51 .161 as discussed above to, provide for full or partial exemptions 

from public participation. . 

Review of the Proposed Revisions to Montana's De 1Vhniznis Rule ' 

In reviewing the proposed revisions to Montana's de minimis rule against the criteria 

discussed above, EPA has identified several concerns about the State's exemptions from its NSR 

program As discussed in greater detail in the enclosure to this letter, it appears that the State 

may be exempting certain actions from permitting requirements that EPA would not consider to 

be de minimis,such as netting actions. Further, EPA is concerned that the de minimis exemptions 

as written could compromise adequate implementation of the State's major source permitting 

programs. In addition, EPA questions.whether the State's de. minimis rule will adequately ensure 

that niodified sources don't cause or contribute to a violation of the NA.AQS or interfere with the 

control strategy . 

sources 

is especially concerned about the impact these exemptions could have on 

the State's plans to bring areas in violation of the NAAQS into attainment. Finally, EPA has 

, . major concerns about the provision that allows changes to emission limits or production limits 

established ~ preconstruction permits without ~going through full NSR permitting procedures 

('including public review and comment). . 

In these proposed revisions to the de nunimis rule, the State has added a provision 

requiring advance notification to the State when a source is proposing certain de minimis 

modifications. We believe this is an essential requirement and should be required for all physical 

changes or changes in operation that are not already allowed in the permit or covered under 

existing StatelFederal malfunction, startup, shutdown, or other excess emission reporting 

requirements . Such notice should be required at least ten days in advance of beginning actual 

, construction on the modification (rather than in advance of startup ofthe modification), so that 

.k_>. .}A1ie~State,:Cias'~he.°abilto'preventthi,,= oiistr.~ ctir~itar~tnddr~caxioit'ofa'u'rirL~iftF1t°iic~ieasi ~ :` 

emissions would cause or~ contrnbute to a violation of the NAAQS or interfere with the SIP, or if . : 

the modification would be subject to major modification perrnitting requirements : We also ' 

believe the State should have either an approval role or veto authority to ensure that. a 

modification that should not be considered- de minimis does go through fiill State and public 

review (m .case the State has not identified ail of the potential -circumstances-in its iule when ~a 

. permit modification might warrant more detailed review). . ,Such advance notification would help 

. to ensure that this rule does not conflict with the major source permitting,requirements and the 

requirements of the minor source ,program to be able to prevent constiuction or modification o£ a 

source if it :would cause or contribute to a violation of thd NAAQS or interfere with the control 

strategy (although, as detailed in the enclosure" ,'-this would not address all of EPA's concerns with 

this rule). . 

EPA has explained in detail our concerns with the proposed de minimis rule in the 

enclosure and, where possible, we have suggested revisions that might address our concerns . If 

the State plans to move forward to revise the de minimis exemptions from its NSR permitting 

requirements, then we strongly recommend that the State consider the issues raised in this letter 

to ensure protection of the integrity of the State's major source permitting programs and its plan 
10- 9-02 ; 2 :43PM ; ;3033726064 tP 24/ 35 

.0r, 

to attain and maintain the NAAQS. When this revision is subrnitted as a SIP submittal, the State 

must explain the basis for these exemptions, pursuant to 40 CFR 51 .160(e), including why.the 

State believes the mandates of the Act regarding major source permitting and NAAQS ' 

compliance will not be compromised under the State's de minimis rule . ' 

If you have any questions about this letter or the enclosure or if you want to discuss these 

issues in further detail, please feel free to contact me at (303) 312-6005, or have your-staff 

contact Vicki Stamper at (303) 312-6445 . 

Enclosure 

cc: Bob R.aiscli, planning, prevention, and Assistance Division, MT DEQ 

Dave Slemp, Air and Waste Management Bureau, MT DEQ 

. . r . " .... 
10- 9-02 ; 2 :43PM ; ;3033126064 # 25/ 35 

Enclosure 

EPA has the following comments on the State'.5 proposed revisions to its de minimis rules in 

ARM 17.8 .705 and 17.8 .733: . . 

1) As a preliminary matter, EPA .has concerns about the modification size cutoff (IS tons per 

yeai (tpy)) thafthe State proposes as de minimis. Fifteen tpy represents the major modification 

significance level~for one criteria pollutant (PM-10) and exceeds the significance level for another 

criteria pollutant (lead) as well as for several non-criteria, pollutants. It also exceeds the major 

source threshold for hazardous air pollutants (HAPs). It is thus not de minunis in the sense of 

having trivial environmental effect. EPA has agreed in the context ofpart 70 operating permit 

programs that certain activities with emissions of 5 tpy or less may be considered "insignificant." 

However, EPA never before denoted emissions increases as high as 15 tpy as de minimis. EPA 

requests that the State provide an explanation of why it believes emission increases as high as 15 

tpy should be considered as having trivial environmental effect. 

2) In ARM 17.8 .705(1)(q), the State is proposing to exempt routine maintenance, repair, and 

replacement of equipment from the requirement to obtain a preconstruction permit. This 

exemption for routine replacement in the definition of "major modification" has often been 

misinterpreted. For example, a source could replace a piece of equipinent with a more efficient 

piece of equipment that could allow the source to increase production above what it was 

physically capable of achieving before the replacement and thus increase emissions. Such a 

"debottlenecking", action would not be considered routine replacement and should be reviewed 

for its impact on the NAAQS and the State's control strategy, as well .as for its applicability to 

major source permitting requirements . Thus, while EPA generally does not believe a permit is 

.~ tiecessat~foriouti~iejilaeemetit;:EF~L-do"es-believe~~that-some :ad.~rance-ievieyv~Qf#h~p~ac.~ed' 

should occur by the State to ensure that the activity is "routine." Therefore, EPA =action . ' 

recommends that the State delete routine replacernent from ARM 17.8 .705(1)(q) and add it as a ~ 

subset of ARM 17.8 .705(1)(r), so it will be subject to the advance notification requirements of 

. ARM 17.8 .705(1)(r)(ii) . . . . . . . . 

3) EPA bplieves that advance notice to the State of the changes whic~li a source is.blaiming as , 

de minimis is essential to ensure that modifications which should otherwise trigger ~new source 

review permitting are not exempt from review. 'However, EPA does not believe 10 days be.fare 

startup or use of the change is adequate advance notice. First, the State ~riceds to be able to 

prohibit construction of a new or modified unit if the modification to the source would cause or 

contribute to a violation of the NAAQ$ or interfere with the control strategy, or if the 

modification is subject to PSD or nonattainment NSR permitting. If a source has already begun 

construction on an emissions unit by the time the State is notified of the source's planned 

modification, then the State would not be able to meet the requirements of 40 CFR 51 .160(b) if 

the State determines that the modification could cause or contribute to a violation of the NAAQS. 

Also, if the modification =were subject to P SD or nonattainment NSR permitting requirements but 

no one realized it until the State reviewed the changes, then the source would be in violation of 

. .t,~ 
70- 9-02 ; 2=43PM ; ;3033126064 # 26/ 35 

the major source permitting requirements for commencing construction prior to obtaining the 

appropriate permit . EPA and States have historically found that it is much more difficult to ~ 

ensure compliance with major source technology requirements such as best available control 

technology (BACT) if the source has already commenced construction and built up equity in the 

design of the modification. Thus, EPA believes the State must 'require notification at least ten 

days in advance of beginning actual constiuction on a modification to a source . _ 

In ARM 17.8 .705(1)(r)('rii), the State has listed some types of activities that can be exempt 

from advance notification requirements, including the addition, modification, or replacement of 

pumps, valves, flanges, and similar e4nissions sources. EPA wonders whether some of these 

activities would fall under the routine repair and maintenance exemption in ARM 17.8 .705(1)(q) . -

In any case, EPA believes the State should require advance notification for any type of 

replacement or addition of equipment, because these types of activities could result in an increase 

in emissions. ' 

~ The State has also exempted from advance notification day-to-day fluctuations occurring 

as the result of a source's design or permitted operations including startup and shutdown. EPA 

is confused as to why these activities are listed here. Day-to-day fluctuations would not normally 

be treated as a modification subject to ~preconstruction permitting. However, excess emissions 

that occur during day-to-day operation, including those due to startup, shutdown, and 

malfunctioin, are required to be reported to the State in accordance with the applicable State or 

Federal (e .g., New Source Performance Standard (NSPS)) requirements . Thus, EPA believes this 

provision in ARM 17.8 .705(1)(r)('lii)(A) should be deleted, as it is confusing and potentially could 

allow sources to not report their excess emissions. 

.... 

,.-~ ~. ~: :-~; r- EFAabotwtsuders-;if<.'ten-dag~s'nd~~ei~otice:a~ill~ always bli~ adequati~fovtiteStato.-tci~ 

determine if a modification to a source should be-subject to permitting requirements, -especially . 

considering the limited information requested from the source in ARM 17.8.705(I)(r)(W) . EPA -

believes the rule should be written to give the State the authority to request fizrther information or . 

'have additional time before the modification can go forward. 

, Further, the State's proposed de minimis 

pale 

does not ~ppear to give the State the 

.authority to -prevent a modification from being exempted as de minimis. . In other words, the State 

should have the authority to require a pernut for a modification even if it appears to meet all of , 

the criteria of the State's de minimis rule : . T'here may be many situations where the State will 

want or need to use this authority, such as in response to significant public interest or in the event 

that the State's de miniinis regulation may not explicitly exclude all of the modifications that' . 

should NOT be exempt from permitting requirements. . 

Last, in ARM,17.8.705(1)(r)(iv), regarding the notification required to the State "in the 

event of an unanticipated circumstance causing the' de minimis change," the proposed rule 

specifies that the State should be notified as soon as "reasonably practicable?' These types of 

changes would likely be due to malfunctions, which should be covered under the State's , 
10- 9-02 ; 2 :43PM ; ;3033728064 # 27/ 35 

malfunction -regulations . In other situations, EPA believes the State should have a deadline for 

reporting these types of changes, such as "as soon as reasonably practicable but no later than five 

days after beginning actual construction on the de mininiis change." 

.., .. 

: . 

4) EPA.has major concerns .with the implementation of the de minimis rule for sources located 

in or impacting nonattainnient areas (or areas which are subject to an EPA SIP call, such as 

Billings or Kalispell) which are proposing to increase emissions of the pollutant of concern. When 

the State adopts an attainment plan for such an area, that plan is based on presumed emissions 

from all existing sources in the area. Any modification* which allows an increase in emissions from 

an existing source could jeopardize the State's plan for attaining the NAAQS. . 

It is not clear that ARM 17.8 .705(2) would effectively prohibit a modification that would 

interfere with the State's attainment plan for an area. While the second sentence of ARM 

16. 8.705(2) allows certain types of permit conditions to be changed only if such change doesn't 

violate the SIP, this would presumably not include changes at sources Which.were modeled at' a 

certain level of emissions in the attainment demonstration but which aren't subject to any specific 

condition of the SIP. Further, the third sentence of ARM 17.8_705(2) allows emission limits or 

production limits to be changed, and it appears that such changes are allowed even if those limits 

are specified in any statute, rule, or the~SIP. Thus, unless the State can adequately demonstrate to 

EPA's satisfaction that this de minimis rule won't interfere with the State's attainment plans for 

areas that arc violating the NA.AQS, EPA does not believe the State should be allowed to exclude 

such modifications from permitting requirements . . 

5) The wording of the de rninvnis exemption is inconsistent with the implementation of major 

source permitting requirements and, thus;'cotild be misleading-to the regulated community and ; 

biild~tesiili'in ~'Faiulty,imp!'eittentatinii=bf tlie<:m1~j'd7r'soui:.i ;e~estnitt~g"~ii°~gc~n5s," ~ Spcdiifi " ~, wh~ji `. ,t 

requa rements, e pernuttmg agency generally compares the actuai emissions of a proposed new 

or modified unit before the modification to the future potential emissions from the new or ' 

modified unit (s):zfter the change. (See definitions of "net emissions increase"_at 40 CFR . , 

51.166(b)(3)~ and 40 CFR 51 .166(b)(2I)(rv) in the definition of "actual erttigsions;' -as well as page 

A-41-in the Octobec 1990 NSR Workshop Manual). However, in the de~minimis~dkeirrption, the ~ 

State is comparing potential emissions befoie the change to potential emissions .after the change. . . 

Using a different test for the exemption could lead to misinterpretation of the major source ' 

peraitting requirements in subchapters 8, 9, and 10 of the State's regulations. Thus. . to avoid ' 

conl'usion and misinterpretation, it would be more appropriate to exempt sources by-comparing 

actual emissions before the modification to potential emissions after the modification, simila'r to 

the current Federal major source permitting requirements. 

th ' 

a major source undergoing. a modification is reviewed for applicability to major~souice permitting ' 

6) In ARM 17.8.705(1)(r)(i)(E), the State provides for modifications to be considered de 

minimis based on "netting out of review" - i .e., considering emissions reductions that are made 

Federally enforceable when determining the potential to emit of a modified source . As discussed 

in the cover letter to this enclosure, EPA stated in its August 31, 1995 proposed rulemaldng that 
10- 9-02 ; 2 :43PM; ;3033126064 # 28/ 35 

it would not consider netting transactions to be de minimis (see 60 FR 45548) . EPA was 

specifically referring to netting transactions at existing major sources which are proposing to 

exempt a significant modification from major source permitting requirements by "netting out of 

review. However, EPA has also taken the position that, to be-considered Federally enforceable, 

limitations on emissions or a source's potential to emit must go through at least some level of 

public participation. In addition, as discussed on page A36 of EPA's October 1990 NSR 

Workshop Manual, when any emissions decrease is claimed, then all source-wide creditable and 

contemporaneous increases and decreases must be included in determining a source's net 

emissions increase. Montana's de minimis rule does not require this . Such a modification in 

which the source is netting out of review cannot be exempt from preconstruction permitting 

requirements as de minimis. . ' 

7) EPA is concerned that the de minimis rule could allow a source to violate the SIP, which . 

result is inconsistent with the requirements of 40 CFR 51.160(a) and (b) . 'Specifically, in the list 

of exceptions to the de minimis modifications in ARM 17.8.705(1)(r)(i)(A)-(E), the State has not 

excluded changes that would violate the SIP. TD address. this deficiency, a provision should be 

added under ARM 17.8.705(1)(r)(i) to state that any construction or changed conditions of 

operation at a facility that would violate any requirement of the SIP is prolubited.~ The State 

cannot allow a source to violate the SIP or change any requirement~of the SIP through a 

preconstruction permit. This includes changes to the SIP compliance-determining methods, 

reporting requirements, etc. A change in a SIP requirement generally must be accomplished 

through revision to the SIP and approval by EPA 

© 

' 8) Similarly, the State cannot allow a source to make significant changes in the terms of its . 

PSD permit, nqnattainment NSR permit,_,or its, part 70: permit, without undergoing State and - : .; '. . 

.1996~retle,rtsfi'theYor:gin` " .atib~itiCb'i~"oftFte ., _ 

de. miiiimis rule. The State has proposed to add a piovision in ARM 17.8.705(2) stating that 

conditions in the permit regarding control equipment specifications, operational procedures, or 

testing, monitoring, recordkeeping, and reporting maybe modified if the modification does not. 

violate any statute, rule, or the SIP. This may have been added to address our concerns about -the 

. . original de minirnis rule . : -However, the Federal.regulations and statute do not address whether- .. . . 

States can administratively change.the conditions of issued PSD or nonattainment NSR ~etnzits ~,. . .' 

.e., the process for revising those permit terms is not-identified in the Federal rules). It has been ~" .(i . 

EPA's policy that only insignificant changes to term in PSD or nonattaimnent NSR permits:.can 

.. . be made administratively, and that any other changes must ~undergo full State and public/EPA . 

review . Such is also the case with part 70 sources, as is stated in 40~CFR 70:7(e)(4). In addition, ~ ' 

the State cannot revise design equipment, work practice, and operational standards, or approve 

alternative test methods for sources subject to Federal NSPS or National Emission Standards for 

Hazardous Air Pollutants (NESfIAPs) without receiving prior EPA approval. 

9) As discussed above, the State is proposing to add a provision in ARM 17.8 .705(2) stating 

that conditions in the permit establishing emission limits, or production liriiits in lieu of emission 

limits, may be changed or added if requested by the applicant. The previously adopted version of 
10- 9-02 ; 2 :43PM ; ;3033126064 0 29/ 35 

this rule did not allow the State to process modifications at existing sources as de miniznis, if the 

change would violate any emission or production limit in a permit . Now, the State is broadly 

expanding the scope of changes that could be considered de minimis. Further, under the State's 

proposed rule, the changes in emission or,production limits are not excluded from being 

considered de minimis even if those emission limits stem from Federal or State statute or 

regulation or the SIP. EPA cannot envision any acceptable circumstance for changing an 

emission limit or production limit established in a preconstruction permit through an 

administrative process without full State, EPA,,and public review. Such limitations would 

generally have been derived from BACT or Lowest Achievable Emission Rate (LAER) 

requirements for major sources, a requirement of the SIP, a Federal regulation (such as NSPS, a 

limit on a source's potential to emit (i .e., ~a synthetic minor Emit), or a BACT limit imposed by the 

State on a natural minor source . EPA does not find it appropriate to revise any of these types of 

limits without going through a fu11 permit revision with public participation; some of these 

changes may also require appioval from EPA (such as a change in a SIP or NSPS limit) . If a 

situation arises where a. source is requesting a very minor change in a BACT Emit, the State 

should contact EPA to determine whether a full permit revision would. .be required. In any case, 

EPA cannot approve a provision that allows a source undergoing a physical change or change in 

the method of operation which would cause it to violate its permitted emission or production limit 

to revise its emissions or production limits without going through full preconstruction permitting 

review (including public participation). 

Please note that, under 40 CFR 51 .166(r)(2), if a source or modification becomes a major 

source or major modification solely by virtue of a relaxation of any enforceable limitation on the 

capacity of the source to emit a pollutant (such as a limitation on operating hours or production 

rate),..then that source must meet all of the znajor source-permitting "uirernents -as though . , . . .. . , 

'~;.~'cbiiim°u~t~=1~i~-'ri`oir ~cb3ti ~ '~ . . y~et rrieaded oi~=.~h~'soutce:; :Tlie~proaiision=afARM 17 S:~.OS' , , , 

also conflict with. this requirement. ~ : ' 

10) In ARM 17.8.705(1)(r)(1)(D), the State should add at the end of this provision "or under 

subchapters 8,~ 9, or 10." If a source is attempting to split up a major modification into several 

minor modifications; it is probably to avoid permitting under the major soui'ce pernutting 

requirerinents: - : ' . _ . _ . . . - 
10- 9-02 ; 2 :43PMp 

;3033126064 tt 30/ 35 

C C p,/C~/L 

Ref 8P-AR 

UNITED STATES ENVIRONMENTAL PROTECTION AGENCY 

' REGION B 

99918TmsTREET - sL11TE soo 

, DENVER, CO 80202-2466 - 

,foe Gerbase, Chairperson 

Board of Environmental Review 

P .O. Box 200901 

Helena, Montana 59620-0901 

APR I 

Re: EPA's Review of Montana's De Minimis Rule and its Proposed Revisions 

Dear Mr. Gerbase: 

We are providing comments on the revisions proposed to the State's "de nunitnis" rule in 

Sections. 17.9 .'705 and 17.8.733 of the Administrative Rules ofMontana (ARNf). This rule allows 

existing air pollution sources, to make certain modifications vvtthout having to obtain a . 

preconstruction permit. We are concerned that the. rule could allow sources to .violate both major 

and minor source preconstruction permitting req*ements, as well as the State Implementation 

Plan (SIP): These deficiencies could prevent us from approving the revised rule. Following are 

EPA's recommendations for improving this rule. We discuss our concerns in detail further below. 

How could the Board of Environmental Review significantly _improve the de minimis rule? 

.. You could adopt several changes to.the, de minimis:rule~in this rulemaldng_that would help 

to~a'ssuY.ethat>sousees'dorn~it~viplate;fede=at :per,nuttici- .- eqiiizemes ~oi~he:~T~PLiwIiei~~aiiiiin~-d~ 

.. . . ., . . . .' ..,. . . .. . . . . . . . 'iniiiimis exemptic~ns. `Wliile EPA cannot guarantee that thete chaiiges would~iesotve all of QuT ~ 

issueg, these changes would greatly strengthen the State's de ~minirnis rule: 

1 . In ARM 17.8 .705(1)(r)(iv), require the advance, notice to be submitted "it least ten days 

prior.to ,omtnencing construction on the proposed de minimis change." ~T}he rule should 

also provide for the State to request further information from a source,*aiid to prevent 

construction on a change while the State is determining whether ~a change is de minimis. 

In ARM.17.8 .705(lxr)(i)(E), revise the latter half of this sentence to :deletethe phrase 

" . . .unless such reductioins"are made federally enforceable ." 

3. In ARM 17:8 .705(2), revise the last sentence of this provision to read "Conditions in the 

permit establishing emission limits, or production limits in lieu of emission limits, may not 

be changed or added under (1)(r)." 

4. Add a statement in ARM 17.8.705(1)(r)(i) that "Sources in nonattainment areas or areas 

subject to a SIP call that are proposingto increase emissions of the nonattainment/SIP call 

pollutant are not de miniunis and must meet all preconstruction permitting requirements ." 
10- 9-02 ; 2 :43PM ; . ;3033126064 # 31/ 35 

Add a new section 17.8 .705(1)(r)(1)(F) to state that "any construction or changed 

conditions that would violate a requirement of the SIP are prohibited." 

What are EPA's concerns with the de minimis rule? 

'The de minimis rule could allow sources to violate maior sourcepermitting requirements 

" State review of the de minimis change ten days prior'to souice operation (as provided 'for 

" " in ARM 17.8 .705(1)(r)(iv)) is too late, in most cases, to meet the requirements of our 

= " regulations. An owner or operator of a source-may think a chaiige qualifies as de mini~,is~ 

but the-State may find that the change requires a major preconstruction source permit. . 

Thus, notice of de minimis modifications must be sent to the State prior to source ' 

construction . The State must be able to request.,mlore information or prevent construction 

on a change while the State is determining whefilier a change is de rninimis . 

If a source is proposing a significant emissions increase,and wants credit for emission -

decreases that have occurred, that source must obtain a preconstruction pezmit that meets 

'all public participation requirements to make these reductions federally~enforceable. In ' 

" addition, EPA's ma,jor,~ource pei~nnitting regulations require all source-wide credftable 

creasbs ~ai~d'itecreas~s~thaE liave occur,ied in the last five'yea~s'to be include'd iit .' ~i- .In 

determining the net emissions increase. The pravision.in ARM 17.8.705(1)(r) 01(E) does 

not meet these requirements. Such "netting actions" should not be exempt as de miniunis . 

. The de rninitnis exemptions are based on a different comparison of.emissions than under 

L hY ,: :~the ~risource petmittin a r"e' " uirem ts '".T his ~could'result ~in fau "'iiii 

' major source permitting rules generally require comparison of actual,emissions before the 

potential to emit of a source befor,e amod~.catioin to the 1Sotential.t"o emit of-that source 

after a modification to determine if the increase is less t3ian the 15 tpy threshold. The 

'fW.A :'.s7i "":rl.: 

P+~ ~(M ~;cti~~ 

.. . .. . . . "" , " 

. . . 

i ." . ' . . . 

. . . " ~ . 

The!de miriiiriis rule coul'd,allow sources to violate the SIP or interfere with aft-aiiament 

. 

. 

The third sentence of ARM 17.8 .705(2) allows emission liunits to be changed through an 

administrative process. . It does not state that such limits can't be changed if those liinits . : 

are specified in the SIP. In addition, while the SIP's control strategy inay"'not specify an 

emission limit for a source, that source may have been modeled at a certain level of 

emissions in the attainment demonstration for an area. If the State allows such sources to 

increase emissions, it could jeopardize an area's attainment strategy . 

In the list of exemptions from de minimis changes in ARM 17.8 .705(1)(r)(i)(A)-(E), the 

State has not exempted changes which would violate the SIP. Under the Clean Air Act, 
10- 9-02 ; 2 :43PM ; ;3033126064 ' tP 32/ 35 

0 

0 

the State can't change SIP emission limits or other requirements, such as compliance 

determining methods, without adopting a SIP revision and receiving approval from EPA 

The 15 tpy, de minimis level is the same as or greater than the major modification 

significance level for two criteria pollutants - PM 10 and lead . Thus, it is difficult to 

consider this level as having trivial environmental effect. Under the part 70 operating 

permit program, EPA has allowed activities with emissions of up to 5 tpy to be considered 

'insignificant. The State must explain why it believes increases as high as 15 tpy are 

considered to have trivial environmental effect when this is submitted as a SIP revision. 

.Alternatively, the State could reduce the de minimis threshold in ARM 17.8 .705(1)(r)(i). 

The de minimis rule could allow sources to violate preconstruction Qermit process requirements. 

The Board proposes to add a provision to ARM 17.8.705(2) stating that conditions in the 

permit establishing emission limits, or production limits in lieu of emission Iinnmits, may be 

changed or added if requested by the applicant. The State is now broadly expanding the 

scope of this rule, because such changes were prohibited under the previous de mirumis 

rule. Further, the proposed rule does not prohibit chaftges in emission limits that stem 

from.Federal or State statutelregulation or from the SIP. EPA cannot envision any 

acceptable circumstance for implementing this provision. Revisions .to an emission or 

production limit -previously established in a permit must go through a full permit revision, 

including State, EPA, and public review. . In addition, a source can't violate a SIP 

emission limit without the State adopting ~a SIP revision and receiving EPA approval. 

EPA's regulatjons for mino,rsouree,perniitting grogtams=at40-CFR51,160(b) require the J~ 

=St~F~tv:~r~veriti'Clie :cotistruction~oi:inodi#ication vf a'source 'if si~c}~'sou~e:vvouldcausd. - - 

or contribute toaviolation ofthe NAAQS or interfere with the .control strategy. Thus; 

notice of de minimis modifications must be sent to the State prior to source construction. 

We seixt -comments on these rule revisions- to -the Department of Enviionniental Quality on 

February . :12,1999, and we discussed the_ comments in a conference call ~oin March 22, 1999. This 

letter summarizes the most significant issues of our Fel5:riuary letter. We encourage you to adopt 

our recornmended revisions to help ensure this rule does not allow modified, sources to violate 

Federal or State requirements . If you have any questions on this letter, please feel free to contact 

'rrie at (303) 312-6005, or contact Vicki Stamper of my staff at (303) 312-.6445: - 

-awl 
10- 9-02 ; 2 :43PM ; ;3033126064 7A 33/ 35 

cc: Don Vidrine, Air and Waste Management Bureau, MT DEQ 

' Bob Ra.isch, Air and Waste Management Bureau, MT DEQ 
10- 9-02 ; 2 :43PM ; 

;3033126064 # 34/ 35 

. 

.UNITED STATES EhMRONMENTAL PROTECTl~N AGENCY 

REGION 81 

999 i8T" sTREET - SuRE so0 

pEKVER, CO 80202-2466 

http:llwww.epa :gov/region08 

MAY I 9 1999 

Ref. 8P-AR 

Tim Wheeiis, Hearing Officer ' 

Montana Board ofEnvironmental Review 

P.O. Box 200901 

Helena, Montana 59620-0901 

'Dear Mr. Wheelis: 

Re: Proposed Revisions to Montana's De Minimis Rule - 

I am writing to fotlowup on my April- 1; 1999 letter to Joe Gerbase; in which.we provided . " 

comments and: reconunendations for improvement on the proposed revisions to. Montaiia's de .. . . 

rninimis rule in Sections 17.8 .705 and 17.8 :733 of the Administrative Rules" o£Montana (ARM): 

~hraugh discussions with you and the Departmesit -of Environmental Quality (DEQ, we . . , 

understand that anost of our comments. are outside the scope of the public notice. In fact, we 

understand-that the Board'inairrly'has the option to either -adopt the, rule changes as proposed or 

not adopt any revisions to the de minimis rule. 7n addition, the DEQ has informed u's of other " . 

provisions in the State's permitting- reguiations that .may addiess .sorne ~dfotlcs-coiicems :with the de . 

minimis .rule . Based on these discussions, we,wanf to infonn you:and the BooaFd;of Environmental " , .. ._ ... . , . 

o tlie ~ a. o~~ ' oof e-.re. ~is a: o " ever~` -1 

'~ ;U P .~. ~Ba~r~ .? .~'~-,, ;l:h visio ~to~~~~ 

. . ,., , . . . . . . . _ _ ~t' " . , . . . -~ .. . ~ ~~ . . 

~ we'canriot-giuarantee approval of 'this rule, as discued ss below . ~ . . . . ~ , . - : :~" .~ . ~ Y~. . . . ' . . . 

The proposed revision to the de miniuYris rule that requires advance notification to the 

DEQ prior to .startup or use ofa de minimis change greatly strengthetisI-he.pre-existing rule, as 

the.pre-exi5ti,n.g rule does not require any advance notification to the -3~EQ. `T1iis change is 

p 

necessary so 'that the DEQ can" deterzziine whether a modificatiori>a~;a ~sour~eis truly de minimis 

rior to *the source maicing the change. We stili"believe that this notification should occur at least 

I O' days prior to commencing construction (or prior to beginning oh-site activities for a change in 

,the .method of operation), so that the~State will be able to prevent construction or modification of 

` a source tbat"should be subject to major source permitting requlcemeiits,°or"that would cause eiv" : : 

contribute to a violation of the National Ambient Air Quality Standards (NAAQS) or the State's 

control strategy. However, given that you believe this change is outside the scope of the public 

notice, we support the Board adopting this change to the de mirnimis rule as proposed rather than 

not adopting the revisions at all . 

While we have been discussing this rule revision with our Headquarters' offices and some 

of the regions, we have not yet been able to determine whether the issue of the timing of the 

notification to DEQ will be an issue for approvability. Neither EPA's regulations or policy 

address these types of de minimis~exemptions from minor source permitting programs, and we 
10- 9-02 ; 2 :43PM ; ;3033126064 7p 35% 35 

~ need to evaluate the impacts that such exemptions could have on Clean Air Act requirements . In 

addition, because this de minirnis rule will be a relaxation of the existing EPA-approved SIP 

(which does not provide for any de minimis exemptions from permitting requirements), the DEQ 

will need to submit information explaining the basis for these exemptions pursuant to 40 CFR 

51 .160(e) and demonstrating that compIiance with the NAAQS will not be compromised under. 

this rule. Thus, while we support the changes to the de tninimis rule because they strengthen the 

rule, we cannot at this time guarantee acceptance when this rule is submitted to us as a State 

Implementation Plan (SIP) revision. Once the complete SIP revision package is submitted to us, 

we will fully consider the State's response to our comments and discuss the rule with our 

Headquarters Offices. 

If you have any questions on this letter, please contact me at (303) 312-6005 or Vicki 

Stamper of my staff at (303) 3~12-6445_ . . . 

cc: . ~= Montana Board~ofEnvirontnwital Revieww' 

Mcintana DEQ,' . 

, nt 

. >~ . . . .r