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Citation: 60 Fed. Reg. 12467 1995 

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Federal Register / Vol. 60, No. 44 / Tuesday, March 7, 1995 / Rules and Regulations

31238) 8. According to these rules,

conformity applies to nonattainment

areas as well as maintenance areas.

Once redesignated, the Detioit-Ann

Arbor area will be a maintenance area

which will be required to conduct

emission analyses to determine that the

VOC and NOx emissions remain below

the motor vehicle emission budget

established in the maintenance plan.

Transportation and general conformity

apply to maintenance areas and

therefore, the Detroit-Ann Arbor area

must comply with these rules. The

Conformity General Preamble to the

conformity regulations further clarifies

this issue, particularly as it pertains to

areas requesting and obtaining a section

182(f) NOx exemption. According to the

conformity rules and preamble, the

Detroit-Ann Arbor area's conformity test

will be to remain within the VOC and

NOx budgets established in the section

175A maintenance plan. Michigan has

established a motor V'ehicle emission

budget for NOx in the area's

maintenance plan. The commentor's suggestion that the

section 182(0 exemption has no

connection to the conformity

requirements for transportation plans

and programs contained in section

176(c)(2)(A) and 176(c)(1)(B) was made

in response to the August 10, 1994

proposal to approve the section 182(f)

NOx exemption for the Detroit-Ann

Arbor area. The USEPA's response is,

therefore, articulated in the final

rulemaking approving the section 182(f)

NOx exemption petition for the DetroitAnn Arbor area published elsewhere in

this Federal Register.

Comment

One commentor states that areas are

requesting exemptions from the NOx

control measures based on incomplete

modeling studies (i.e. Lake Michigan

and Southeast Michigan Ozone Studies)

which do not accurately predict the

relative contribution of mobile source

emissions because the mobile source

emissions inventory understates its

contribution to ozone production.

Furthermore, given the uncertainty of

mobile source NOx contributions to

ozone and the inaccuracy of mobile

source inventories, it is inappropriate to

remove from the SIP any NOx or VOC

conformity analysis.

USEPA Response

Exemption from the section 182(f)

NOx requirements is provided for in

sections 182(f)(1)(a) and 182(f)(3) of the

8 On November 18, 1994 and November 29, 1994,

Michigan submitted SIP revisions to comply with

the Transportation and General conformity rules.

Act. Michigan submitted such an

exemption request on November 12,

1993 for the Detroit-Ann Arbor area

based on 3 consecutive years of clean air

quality monitoring data, not on a

modeling study or analysis. In addition,

approval of an exemption based on

monitoring data will be contingent on

the area's maintenance of the ozone

NAAQS. As noted previously, a section

182(f) NOx exemption will not exempt

areas from compliance with the

conformity regulations. The USEPA

refers the commentor to the final

rulemaking approving the section 182(f)

NOx exemption petition for the DetroitAnn Arbor area published elsewhere in

this Federal Register.

Comment

One commentor notes that there is no

reasonable or adequate basis for

eliminating Michigan's existing NSR

program from the current SIP. Another

commentor states that the USEPA

cannot redesignate the Detroit-Ann

Arbor area because Michigan has not

met the NSR requirements under section

182(b)(5).

USEPA Response

The USEPA believes that the DetroitAnn Arbor area may be redesignated to

attainment notwithstanding the lack of

a fully-approved NSR program meeting

the requirements of the 1990 Act

amendments and the absence of such an

NSR program from the contingency

plan. This view, while a departure from

past policy, has been set forth by the

USEPA as its new policy in a

memorandum from Mary Nichols,

Assistant Administrator for Air and

Radiation, dated October 14, 1994,

entitled Part D New Source Review (part

D NSR) Requirements for Areas

Requesting Redesignation to

Attainment.

The USEPA believes that its decision

not to insist on a fully-approved NSR

program as a pre-requisite to

redesignation is justifiable as an

exercise of the Agency's general

authority to establish de minimis

exceptions to statutory requirements.

See Alabama Power Co. v. Costle, 636

F.2d 323, 360-61 (D.C. Cir. 1979). Under

Alabama Power Co. v. Castle, the

USEPA has the authority to establish de

minimis exceptions to statutory

requirements where the application of

the statutory requirements would be of

trivial or no value environmentally. In this context, the issue presented is

whether the USEPA has the authority to

establish an exception to the

requirements of section 107(d)(3)(E) that

the USEPA have fully-approved a SIP

meeting all of the requirements

applicable to the area under section 110

and part D of title I of the Act. Plainly,

the NSR provisions of section 110 and

part D are requirements that were

applicable to the Michigan area seeking

redesignation at the time of the

submission of the request for

redesignation. Thus, on its face, section

107(d)(3)(E) would seem to require that

the State have submitted and the

USEPA have fully-approved a part D

NSR program meeting the requirements

of the Act before the areas could be

redesignated to attainment.

Under the USEPA's de minimis

authority, however, it may establish an

exception to an otherwise plain

statutory requirement if its fulfillment

would be of little or no environmental

value. In this context, it is necessary to

determine what would be achieved by

insisting that there be a fully-approved

part D NSR program in place prior to the

redesignation of the Detroit-Ann Arbor

area. For the following reasons, the

USEPA believes that requiring the

adoption and full-approval of a part D

NSR program prior to redesignation

would not be of significant

environmental value in this case.

Michigan has demonstrated that

maintenance of the ozone NAAQS will

occur even if the emission reductions

expected to result from the part D NSR

program do not occur. The emission

projections made by Michigan to

demonstrate maintenance of the

NAAQS considered growth in point

source emissions (along with growth for

other source categories) and were

premised on the assumption that the

Prevention of Significant Deterioration

(PSD) program, rather than the part D

NSR, would be in effect, during the

maintenance period. Under NSR,

significant point source emissions

growth would not occur. Michigan

assumed that NSR would not apply after

redesignation to attainment, and

therefore, assumed source growth

factors based on projected growth in the

-economy and in the area's population.

(It should be noted that the growth

factors assumed may be overestimates

under PSD, which would restrain source

growth through the application of best

available control techniques.) Thus,

contrary to the assertion of the

commentor, Michigan has demonstrated

that there is no need to retain the part

D NSR as an operative program in the

SIP during the maintenance period in

order to provide for continued

maintenance of the NAAQS. (If this

demonstration had not been made, NSR

would have had to have been retained

in the SIP as an operative program since

it would have been needed to maintain

the ozone standard.)

12467

HeinOnline -- 60 Fed. Reg. 12467 1995
12468 Federal Register / Vol. 60, No. 44 / Tuesday, March 7, 1995 / Rules and Regulations

The other purpose that requiring the

full-approval of a part D NSR program

might serve would be to ensure that

NSR would become a contingency

provision in the maintenance plan

required for these areas by sections

107(d)(3)(E)iv) and 175A(d). These

provisions require that, for an area to be

redesignated to attainment, it must

receive full approval of a maintenance

plan containing "such contingency

provisions as the Administrator deems

necessary to assure that the State will

promptly correct any violation of the

standard which occurs after the

redesignation of the area as an

attainment area. Such provisions shall

include a requirement that the State will

implement all measures.with respect to

the control of the air pollutant

concerned which were contained in the

SIP for the area before redesignation of

the area as an attainment area." Based

on this language, it is apparent that

whether an approved NSR program

must be included as a contingency

provision depends on whether it is a "measure" for the control of the

pertinent air pollutants.

As the USEPA noted in the proposal

regarding this redesignation request, the

term "measure" is not defined in

section 175A(d) and Congress utilized

that term differently in different

provisions of the Act with respect to the

PSD and NSR permitting programs. For

example, in section 110(a)(2)(A),

Congress required that SIPs to include "enforceable emission limitations and

other control measures, means, or

techniques* * *as may be necessary or

appropriate to meet the applicable

requirements of the Act." In section

110(a)(2)(C), Congress required that SIPs

include "a program to provide for the

enforcement of the measures described

in subparagraph (A), and regulation of

the modification and construction of

any stationary source within the areas

covered by the plan as necessary to

assure that NAAQS are achieved,

including a permit program as required

in parts C and D." (Emphasis added.) If

the term measures as used in section

110(a)(2) (A) and (C) had been intended

to include PSD and NSR there would

have been no point to requiring that

SIPs include both measures and

preconstruction review under parts C

and D (PSD or NSR). Unless "measures"

referred to something other than

preconstruction review under parts C

and D, the reference to preconstruction

review programs in section 110(a)(2)(C)

would be rendered mere surplusage.

Thus, in section 110(a)(2) (A) and (C), it

is apparent that Congress distinguished "measures" from preconstruction

review. On the other hand, in other

provisions of the Act, such as section

161, Congress appeared to include PSD

within the scope of the term "measures."

The USEPA believes that the fact that

Congress used the undefined term "measure" differently in different

sections of the Act is germane. This

indicates that the term is susceptible to

more than one interpretation and that

the USEPA has the discretion to

interpret it in a reasonable manner in

the context of section 175A. Inasmuch

as Congress itself has used the term in

a manner that excluded PSD and NSR

from its scope, the USEPA believes it is

reasonable to interpret "measure," as

used in section 175A(d), not to include

NSR. That this is a reasonable

interpretation is further supported by

the fact that PSD, a program that is the

corollary of part D NSR for attainment

areas, goes into effect in lieu of part D

NSR. 9 This distinguishes NSR from

other required programs under the Act,

such as inspection and maintenance and

RACT programs, which have no

corollary for attainment areas.

Moreover, the USEPA believes that

those other required programs are

clearly within the scope of the term "measure." 10

The USEPA's logic in treating part D

NSR in this manner does not mean that

other applicable part D requirements,

9

The U.S. EPA is not suggesting that NSR and

PSD are equivalent, but merely that they are the same type of program. The PSD program is a requirement in attainment areas and designed to

allow new source permitting, yet contains adequate

provisions to protect the NAAQS. If any

information including preconstruction monitoring,

indicates that an area is not continuing to meet the

NAAQS after redesignation to attainment, 40 CFR

51 appendix S (Interpretive Offset Rule) or a 40 CFR

51.165(b) program would apply. The USEPA

believes that in any area that is designated or redesignated as attainment under section 107, but

experiences violations of the NAAQS, these

provisions should be interpreted as requiring major new or modified sources to obtain VOC emission

offsets of at least a 1:1 ratio, and as presuming that

1:1 NOx offsets are necessary. See October 14, 1994

memorandum from Mary Nichols entitled Part D

New Source Review (part D NSR) Requirements for

Areas Requesting Redesignation to Attainment.

1o The U.S. EPA also notes. that in the case of the

Michigan area, all permits to install for major offset sources and major offset modifications issued by

the State in the moderate nonattainment areas since

November 15, 1992 have complied with the 1.15 to

1.0 offset ratio. In addition, permits to install cannot

be issued under the PSD program unless the

applicant can demonstrate that the increased

emissions from the new or modified source will not

result in a violation of the NAAQS. Michigan's Rule

702, which is part of the SIP, requires the

installation of Best Available Control Technology

regardless of size or location of all new and

modified sources in the State. In addition,

Michigan's Rule 207, also approved in the SIP,

requires denial of any permit to install if operation

of the equipment will interfere with attainment or maintenance of the NAAQS.

including those that have been

previously met and previously relied

upon in demonstrating attainment,

could be eliminated without an analysis

demonstrating that maintenance would

be protected. As noted above, Michigan

has demonstrated that maintenance

would be protected with PSD in effect,

rather than part D NSR. Thus, the

USEPA is not permitting.part D NSR to

be removed without a demonstration

that maintenance of the standard will be

achieved. Moreover, the USEPA has not

amended its policy, with respect to the

conversion of other SIP elements to

contingency provisions, which is that

they may be converted to contingency

provisions only upon a showing that

maintenance will be achieved without

them being in effect. Finally, as noted

above, the USEPA believes that the NSR

requirement differs from other

requirements, and does not believe that

the rationale for the NSR exception

extends to other required programs. As the USEPA has recently changed

its policy, the position taken in this

action is consistent with the USEPA's

current national policy. That policy

permits redesignation to proceed

without otherwise required NSR

programs having been fully approved

and converted to contingency

provisions provided that the area

demonstrates, as has been done in this

case, that maintenance will be achieved

with the application of PSD rather than

part D NSR.

Comment

One commentor suggests that the

USEPA's rulemaking is an effort to

permit Michigan to avoid including the

15 percent Rate-of-Progress (ROP)

measures, required of moderate

nonattainment areas in the SIP. It is

essential to have elements of the 15

percent ROP plan available as

contingency measure in the attainment

plan. It is not clear that the current

rulemaking procedure will allow that to

happen.

USEPA Response

As explained above, under the

USEPA's interpretation of section 107,

an area need not meet all section 110

and part D requirements that become

applicable after the submittal of a

complete redesignation request in order

to have the request approved. Therefore,

the 15 percent ROP plan, which was not

due to be submitted until November 15,

1993, after the submission of the

redesignation request, is not required to

be fully approved into the SIP before

redesignating the area to attainment.

Similarly the section 175A contingency

plan need not include all measures that

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