To: 

From: 

Date: 

RE: 

Dave Heineman 

Governor 

STATE OF NEBRASKA 

DEPARTMENT OF ENVIRONMENTAL QUALITY 

Michael J. Linder 

Director 

Suite 400, The Atrium . 

1200 'N' Street 

P.O. Box 98922 

Lincoln, Nebraska 68509-8922 

Phone (402) 471-2186 

FAX (402) 471-2909 

website: www.deq.state:ne.us 

MEMORANDUM 

J on Bru~ Attorney General 

Shelley kadt:Air Quality Division Administrator 

December 10, 2007 

Title 129 - Nebraska Air Quality Regulations, Concise Explanatory 

Statement for Rules Adopted at the December 2007 EQC Hearing 

SHORT DESCRIPTION: The purpose of this memorandum is to provide an explanation 

of additions and revisions to Title 129 that were adopted by the Environmental Quality 

Council (EQc) on December 7,2007. The changes were adopted by the EQC as 

proposed, without amendment. No comments were received in response to the public 

notice of this proposal, and no one other than NDEQ staff testified at the public hearing. 

The adopted changes are all in section 003.02 of "Chapter 5-0perating Permits-When 

Required." They clarify the process for issuing operating permits to major sources 

comprised of different regulated entities or "persons", as defined in Chapter 1. Chapter 1 

defines "person" as any individual partnership; limited liability company; association; 

public or private corporation; trustee; receiver; assignee; agent; municipality or other 

governmental subdivision; public agency; other legal entity; or any officer or governing 

or managing body of any public or private corporation, municipality, governmental 

subdivision, public agency, or other legal entity. 

The current language of section 003 .02 has only two options for permitting such sources: 

(1) obtain Qne permit fQJ th_e entire source; or (2) obtain a general permit for those 

emission units able to be covered by a general permit and obtain an individual permit for 

the remaining emissions units. If a general permit is not available, then there is only one 

option. The revised language would allow each "person" (regulated entity) to apply for its 

own permit and allow the Department to issue permits in that manner. In addition, the 

language is worded such that sources permitted in this manner will not avoid other major 

source obligations. 

An Equa l OpportunitwA!!irmatiue Action Emp loyer 

@ Printed with soy ink on recycled paper ~ 

I
RATIONALE: The Class I operating permit program requires major sources of air 

pollution to obtain operating permits. The requirements for controlling hazardous air 

pollutants (HAPs) are different than those for other air pollution control programs. Under 

the federal HAP program, $ources that are adjacent to one another and are under common 

control must aggregate their HAP emissions for applicability purposes, regardless of 

whether their operations are similar; that is, whether they fit within the same two-digit 

Standard Industrial Code. These adjacent operations are currently required to be 

permitted under one single operating permit. This practice allows for stringent control of 

HAPs at each HAP emission unit, but it creates certain problems for the Department, 

such as 

• To which regulated entity (person) does the Department issue the permit? 

• If the permit is issued to one entity (person) and another one has a violation, how 

does the Department take enforcement action? 

• Who does the Department designate as the responsible official? 

• What happens when controlling interest is sold to another partner or if the original 

ownership arrangement changes? 

In addition, the current rules create difficulties for the sources permitted in this manner. 

For example, 

• Only one responsible official can certify compliance with a permit, so the current 

regulations could potentially require someone to certify compliance for a source 

over which he or she has little, if any, control. 

• The pelmitted entity would have to make sure that all other businesses with which 

it has partnerships have the information needed to comply with the permit. 

• Businesses are often sold or other partnerships are formed. If the ownership 

arrangement changes, further complications and confusion as to how to divide up 

responsibilities under the permit result. 

ANALYSIS OF IMP ACT: These changes are needed to address current permitting 

issues. In Blair, the Cargill Corporation has partnership arrangements with satellite 

operations around its wet-milling ethanol plant. Without making this change, the 

Department will need to issue asingle operating permit for Cargill, Car_gill Polyols, 

N atureworks and PGLA. Another example may be found in Hastings at the Ag 

Processing Corn and Soy facilities. These operations are under the same corporate 

structure, but have very different operations. There is the potential for more such 

situations to develop in other communities as companies partner with one another, 

innovate to develop new products, and build operations adjacent to one another. The 

adopted changes will resolve this issue by allowing each entity to obtain its own Class I 

. operating permit. 

2 
The federal operating permit program allows for more than one operating permit to be 

issued in such situations. The changes to Chapter 5, section 003.02 would make Title 129 

consistent with the federal program. However, the language clearly states that the 

regulated entity cannot avoid any requirements it would have been subject to had it been 

permitted under a single permit. 

SECTION-BY -SECTION DESCRIPTION: 

Section 003.02A: This section continues to allow an entire source to be permitted under a 

single operating permit. The term "points" is changed to "units" to reflect language that is 

defined in Chapter 1. . 

Section 003.02B: This added section allows a source to obtain more than one operating 

permit if the source is comprised of different "persons", as defined in Chapter 1, even if 

the "persons" are under the same two-digit Standard Industrial Code. The source may 

obtain a separate permit for each "person". Each "person" must obtain a Class I 

operating permit, regardless of size. No "person", under these circumstances, may avoid 

any major source requirements, such as payment of emission fees or compliance with 

MACT standards. 

Section 003.02C: This section continues to allow certain emissions units to be permitted 

under a general permit. The term "points" is changed to "units" as in section 003.02A. 

The added wording is to assure that sources may not avoid major source requirements 

unless the source~wide potential is limited to less than the major source thresholds. If the 

source-wide potential is major, then emission fees are paid on all emission units, 

including those covered by general permits. 

3 

, 

I

I 
FISCAL IMPACT STATEMENT 

Agency: 

Title: 

Chapter 

Title Name: 

Environmental Quality 

129 

5 

Title 129 

Prepared by: 

Date Prepared: 

Phone: 

Statement Status: 

Nebraska Air Quality Regulations 

Type of Fiscal Impact: 

State Agency 

No Fiscal Impact 

Increase Costs 

Decrease Costs 

( x) 

( ) 

( ) 

Estimated Quantification of Impact: 

Political 

Subdivision 

(x) 

( ) 

( ) 

Shelley Kaderly 

October 18, 2007 

471-4.299 

( ) Draft 

(X) Final 

Regulated Public 

(x) 

( ) 

( ). 

No measurable fiscal impact anticipated even though it should be less complicated for the 

Agency to process certain operating permit applications. Operating permits will still be 

required to be processed. 

Page 4 of 4 
NEBRASKA ADMINISTRATIVE CODE 

Title 129 - Department of Environmental Quality 

Chapter 5 - OPERATING PERMITS - WHEN REQUIRED 

001 Applicability and Scope. The following sources are required to obtain 

operating pennits unless exempted under 002: 

001 .01 Class I (major source) pelmits shall be required to operate any of 

the following: 

OOl.OlA Any major source as defined in Chapter 2; 

OOl.OlB Any source, including an area source, subject to a standard, 

limitation, or other requirement under Chapter 18; 

OOl.OlC Any source, including an area source, subject to a standard 

or other requirement under Chapters 23, 27 or 28; 

OOl.OlD Any affected source; 

OOl.OlE Any source in a source category designated by the Director 

or required to do so by any other applicable requirement under Title 

129 or under the Act. 

00l.02 Unless a Class I pennit is required, Class II (minor source) pennits 

shall be required to operate any of the following, unless covered under the 

provisions of Chapter 42: 

001.02A Any source or emissions unit with actual emissions above 

the following: 

001. 02A 1. [rescinded] 

001.02A2. Fifty (50) tons/year or more ofPMIO emissions. 

Changes for December 2007 EQC are on pages 5-2, 5-5, and 5-6. 5-1 
Title 129 

Chapter 5 

5-2 

001.02A3. Fifty (50) tons/year or more of S02 or S03, or any 

combination of the two. 

001.02A4. Fifty (50) tons/year or more of oxides of nitrogen 

(calculated as N02). 

001 .02A5. Fifty (50) tons/year or more of volatile organic 

compounds (VOC). 

001.02A6. Fifty (50) tons/year or more of carbon monoxide. 

001.02A 7. Two and one-half (2.5) tons/year or more oflead. 

001.02A8. Five (5) tons/year or more of any hazardous air 

pollutant or an aggregate of twelve and one-half (12.5) 

tons/year or more of any hazardous air pollutants. 

001.02B All incinerators used for refuse disposal or for the 

processing of salvageable materials except refuse incinerators located 

on residential premises containing five or less dwelling units used 

only for disposal of residential waste generated on the said property. 

001.03 Any source or emissions unit required to obtain a Class I permit 

based on potential emissions may request that potential to emit be limited 

to below the major source threshold, as provided in Chapter 42 or in section 

001.03A and 001.03B below. 

001.03A Any source or emissions unit with actual emissions 

between the levels specified in section 001.02A above and the major 

source levels may apply for a Class II permit, as a synthetic minor 

source, which provides enforceable limits to potential emissions, as 

provided in Chapters 7 through 15. 

Changes for December 2007 EQC are on pages 5-2, 5-5, and 5-6. 
Title 129 . 

Chapter 5 

001.03B Any source or emissions unit with actual emissi011S below 

the levels specified in section 001.02A above shall be exempt from 

the duty to obtain an operating pennit under the following conditions, 

known as the Low Emitter Rule, unless required to do so in sections 

001.02B. 

001.03B1 The source is not otherwise required to obtain an 

operating permit; 

001.03B2 The source has submitted a demonstration and 

maintains records on site, updated at least monthly, for at least 

five years that actual emissions for each regulated pollutant do 

not exceed the levels specified in section 001.02A above; 

001.03B3 Credit for controls which are not required under the 

provisions of this title will only be allowed if documentation is 

maintained that demonstrates that controls were continuously 

maintained and operated as specified by the manufacturer to 

achieve the level of efficiency for which credit is sought; 

001.03B4 Additional infonnation, such as an annual emissions 

inventory or infonnation necessary to detennine applicability 

or to detennine that emissions from the source in conjunction 

with all other emissions will not prevent attainment or 

maintenance of the ambient air quality standards specified in 

Chapter 4, must be provided upon Department request; and 

001.03B5 Compliance with the provisions of this section do 

not shield the owner or operator from the duty to comply with 

any other applicable requirement under Title 129, nor shield the 

owner or operator from enforcement action for the violation of 

any other applicable requirement under Title 129. 

002 Source Category Exemptions. 

Changes for December 2007 EQC are on pages 5-2, 5-5, and 5-6. 5-3 
Title 129 

Chapter 5 

5-4 

. 002.01 All sources listed in 001.01 above that are not major, or affected 

sources, are exempt from the obligation to obtain a Class I permit unless 

required to do so under another applicable requirement under Title 129 or 

under the Act. Any such exempt source may opt to apply for a permit under 

these regulations and shall be issued a pennit if the applicant otherwise 

satisfies all of the requirements of these regulations. 

002.02 The following sources are exempt from applying for and having a 

Class I or II operating permit: 

002.02A All sources and source categories that would be required to 

obtain a pennit solely because they are subject to 40 CFR Part 60, 

Subpart AAA - Standards ofPerfonnance for New Residential Wood 

Heaters; and 

002.02B All sources and source categories that would be required to 

obtain a pe1111it solely because they are subject to 40 CFR Part 61 , 

Subpali M - National Emission Standard for Hazardous Air 

Pollutants for Asbestos, §61.145, Standard for Demolition and 

Renovation. 

002.02C All sources and source categories subject only to 

regulations or requirements under Section 112(r) of the Act. 

002.02D All sources and source categories that would be required to 

obtain a pelmit solely because of the presence of a generator whose 

sole function is to provide back-up power when electrical power from 

the local utility is interrupted. This exemption is unavailable to 

peaking units at electric utilities and any other generator which is 

used during time periods when power is available from the utility. 

Exempted units must submit an annual report of hours of operation to 

the Department by the end of the month following the month in 

which 500 hours per year are exceeded, or upon request. 

Changes for December 2007 EQC are on pages 5-2, 5-5, and 5-6. 
Title 129 

Chapter 5 

003 Emissions Units Covered. 

003.01 Sources required to obtain an operating pennit under this title shall 

identify all relevant emission units in the pennit application unless the 

emission unit is specifically exempted pursuant to sections 006.03 and 

006.04 of Chapter 7. 

003.02 A source required to obtain an operating pennit under this title may 

comply through one of the following methods: 

003.02A +he A source may obtain a single pel111it for all relevant 

emission pBffits units located within a contiguous area under common 

control, whether or not falling under the same two-digit Standard 

Industry Code (SIC) code; or 

003.02B A major source, as defined in Chapter 2, section 001 or 

section 008, comprised of different business entities (each defined as 

a "person" in Chapter 1, section 107), whether or not they are under 

the same two-digit SIC code, may obtain a separate pennit for each 

business entity ("person"). All business entities ("persons") must 

obtain a Class I pennit regardless of size. Sources may not avoid 

major source requirements, including, but not limited to, emissions 

fees (see Chapter 29) or National Emissions Standards for Hazardous 

Air Pollutants requirements (see Chapters 27 and 28), by being 

pennitted in this manner; or 

003.02BC +he A source may request and obtain coverage for one or 

more emission pBffits units eligible for coverage under a general 

pennit issued by the Department and obtain a separate pennit for 

emission pBffits units not eligible for such coverage. Sources may not 

avoid major source requirements, including, but not limited to, 

emissions fees (see Chapter 29) or National Emissions Standards for 

Hazardous Air Pollutants requirements (see Chapters 27 and 28), by 

being pennitted in this manner, unless the source-wide potential 

emissions are limited to less than the major source thresholds by 

Changes for December 2007 EQC are on pages 5-2, 5-5, and 5-6. 5-5 
Title 129 

Chapter 5 

these pennits. This would include paying emissions fees for 

emissions from the unites) covered by a general pennit.. 

Note: Section 003.03, as shown below, has been adopted by the EQC 

but not yet approved by the Governor. 

003.03 A source required to obtain a mercury budget permit under 

rules incorporated in Chapter 18, section 005, must obtain, in addition 

to any other required permits, a mercury budget permit which covers 

every mercury budget unit at the source, contains all applicable 

mercury budget program requirements, and is a complete and 

separable portion of the operating permit. 

004 Fugitive Emissions. Fugitive emissions from a source shall be included in 

the pennit application and covered in the operating pelmit in the same manner as 

stack emissions, regardless of whether the source category in question is included 

in the list of sources contained in the definition of major source. 

005 Except as provided in Chapter 12, section 003, no source may operate after 

the time that it is required to submit a timely and complete application, except in 

compliance with a pennit issued under an approved operating permit program. If 

an operating source submits a timely and complete application for pennit 

issuance, or for renewal, the source's failure to have a pennit is not a violation of 

the State Act or Act until the Department takes final action on the pennit 

application, provided that the failure to have a pennit is through no fault of the 

source. This protection shall cease to apply if, subsequent to the completeness 

detennination made pursuant to Chapter 7, section 003, the applicant fails to 

submit any additional infonnation necessary to process the application within the 

deadline specified in writing by the Department. 

006 The submittal of a complete Class I or II operating pennit application shall 

not affect the requirement that any source have a pre-construction pelmit as may 

be required by these regulations. 

5-6 Changes for December 2007 EQC are on pages 5-2, 5-5, and 5-6. 
Title 129 

Chapter 5 

Enabling Legislation: Neb. Rev. Stat. §§81-1S04(1)(2); 81-1505(12)(16)' 

Legal Citation: Title 129, Ch. 5, Nebraska Department of Environmental Quality 

Changes for December 2007 EQC are on pages 5-2, 5-5, and 5-6. 5-7