Memorandum to Docket EPA-HQ-OAR-2012-0322 

Estimate of Potential Costs of this Rulemaking 

April 28, 2015 

1 

MEMORANDUM 

TO: Docket for rulemaking, "State Implementation Plans: Response to Petition for 

Rulemaking; Restatement and Update of EPA’s SSM Policy Applicable to SIPs; 

Findings of Substantial Inadequacy; and SIP Calls to Amend Provisions Applying 

to Excess Emissions During Periods of Startup, Shutdown and Malfunction"

(EPA-HQ-OAR-2012-0322) 

DATE: April 28, 2015 

SUBJECT: Estimate of Potential Direct Costs of SSM SIP Calls to Air Agencies 

This memorandum presents an estimate made by the U.S. Environmental Protection Agency 

(EPA) of the potential direct costs to state and local air agencies associated with SIP calls under 

the subject final action, which concerns state implementation plan (SIP) issues related to excess 

emissions during periods of startup, shutdown and malfunction (SSM). As part of this final 

action, the EPA is promulgating SIP calls for 36 states, affecting 45 SIP jurisdictions.1

 

In response to the February 2013 proposal for this rulemaking action, the EPA received public 

comments concerning the adequacy of the EPA’s accounting for potential costs to air agencies, 

sources and the public as a result of the SIP call action. The EPA provides its response to these 

comments in the notice of final action (see, e.g., section V.D.7 of the final action). 

To the extent that the EPA is issuing a SIP call to a state under Clean Air Act (CAA) 

section 110(k)(5), the EPA is requiring that the state revise the identified provision(s) in its SIP 

to comply with existing requirements of the CAA. The EPA’s action leaves to affected states the 

choice of how to revise those SIP provisions subject to the SIP call action to make them 

consistent with CAA requirements, and it does not directly impose costs on any sources or the 

public. 

The EPA anticipates that the SSM SIP call action will result in some direct costs, specifically on 

the affected state and local agencies to submit corrective SIP revisions. In considering potential 

costs of this rulemaking action, as described in detail below, the EPA estimated a total direct cost 

of $158,220, entirely in labor costs to state and local air agencies associated with one-time SIP 

revision activities. 

 

1

 The state has the primary responsibility to implement SIP obligations, pursuant to CAA section 107(a) of the Clean 

Air Act (CAA). However, as CAA section 110(a)(2)(E) allows, a state may authorize and rely on a local or regional 

government, agency or instrumentality to carry out the SIP or a portion of the SIP within its jurisdiction. As a result, 

some of the SIP provisions at issue in this rulemaking action apply to specific portions of a state. Thus, in certain 

states, submission of a corrective SIP revision may involve rulemaking in more than one jurisdiction. 
Memorandum to Docket EPA-HQ-OAR-2012-0322 

Estimate of Potential Costs of this Rulemaking 

April 28, 2015 

2 

Summary of Estimated Costs 

The following table presents the EPA’s estimate of direct costs to state and local air agencies 

associated with the SSM SIP calls. 

Table 1. Estimated Direct Costs to State and Local Air Agencies 

Associated with SSM SIP Call Action 

SIP revision 

activity 

No. of SIP 

revisions 

Labor 

hours per 

SIP 

revision 

Labor cost 

per activity 

hour Total cost 

State/local air 

agency submits SIP 

revision 45 40 $87.90 $158,220

Components of the activity shown in Table 1 for the state/local air agency to submit a SIP 

revision include development of a state rule, conducting notice and public hearing and other 

costs incurred in connection with a SIP submission. As a practice of efficient resource 

management, it is common for an air agency to combine certain activities when needing to 

change multiple SIP-approved rules, sometimes even to process those changes together as a 

single SIP revision and submission. For example, pursuant to the infrastructure SIP requirements 

under CAA section 110(a)(2), nearly all of the 36 states affected by this SSM SIP call action are 

currently obligated to submit SIP revisions by December 14, 2015, to reflect the most recent 

(2012) National Ambient Air Quality Standards (NAAQS) for fine particulate matter.2 Several of 

these states also remain obligated to submit SIP revisions required as a result of earlier 

rulemakings (e.g., the 2010 SO2 NAAQS). Many states will choose to combine SIP revision 

activities where doing so is reasonable. As a result, in light of the ongoing obligations of states 

and the EPA concerning SIP revisions other than those called for in this action, the EPA expects 

that the actual direct costs to air agencies associated with the SSM SIP calls may be lower than 

the estimate presented for purposes of this memorandum. 

Basis for Assumptions Used in this Cost Estimate 

For the basic assumptions about labor hours associated with SIP revisions, this memorandum 

uses SIP revision burden estimates appearing in an Information Collection Request (ICR) 

document associated with the federal New Source Review (NSR) program under the CAA.3

 This 

 

2

 The CAA requires states to have SIPs that implement, maintain, and enforce a new or revised NAAQS within 

3 years after the EPA issues the standards. The final rule that most recently revised the NAAQS for fine particulate 

matter (PM2.5) was signed December 14, 2012; see 78 FR 3086 (January 15, 2013). Additional information on 

infrastructure SIP requirements, including SIP status reports by pollutant and state, may be found through the EPA’s 

publicly accessible website at http://www.epa.gov/airquality/urbanair/sipstatus/infrastructure.html. 

3

 See “Information Collection Request for Prevention of Significant Deterioration and Nonattainment New Source 

Review (40 CFR Parts 49, 51 and 52).” This 38-page ICR renewal document approved for the NSR program is 

available through the publicly accessible Regulations.gov website, www.regulations.gov, as Document ID EPA-HQOAR-2011-0901-0008. 
Memorandum to Docket EPA-HQ-OAR-2012-0322 

Estimate of Potential Costs of this Rulemaking 

April 28, 2015 

3 

particular document was selected because it is one of the most recent SIP-related ICRs to have 

been reviewed and approved by the Office of Management and Budget (OMB) for compliance 

with the Paperwork Reduction Act. The approved ICR represents a renewal of an earlier 

approved collection associated with the federal NSR program. 

The types of information collection activities addressed in the cited ICR document for NSR are 

mostly those necessary for the preparation and submittal of construction permit applications and 

the issuance of final permits, and the changes reflected in the renewal result from a number of 

changes in the EPA’s regulations for NSR. However, because state and local reviewing 

authorities are required to submit SIP revisions on occasion when the NSR regulations change, 

that ICR included as a line item a burden estimate for SIP revisions. 

Cost Assumptions Specific to State and Local Activity 

For purposes of estimating state/local agency hours associated with the SSM SIP call action, the 

EPA is using the same estimate reflected in the cited ICR, which is 40 hours for each SIP 

revision.4 

The EPA notes that the labor rate for state and local activity that was used in the cited ICR was 

drawn from employer costs reported by the Bureau of Labor Statistics (BLS) for December 

2011. For purposes of this memorandum, the EPA is using the corresponding updated labor rate, 

as reported by the BLS for December 2014. The loaded labor rate used to calculate the state and 

local agency labor cost is $87.90 per hour, which is the base rate of $43.955 multiplied by an 

overhead factor of 2.6

 

Conclusion 

As shown in Table 1 above, the EPA estimates a total direct cost of $158,220 to state and local 

air agencies associated with the SSM SIP call action. The EPA believes actual direct costs may 

be lower than this estimate, however, because in some cases administrative steps associated with 

these called-for SSM SIP revision activities will likely be shared with other SIP revision 

activities already required of the affected states under other CAA obligations. 

 

4 See “Table 6-2. State and Local RA Respondent Burden and Cost (Annual),” from the ICR renewal document 

approved for the NSR program. 

5 Total compensation, as a cost per hour worked, is reported by the U.S. Department of Labor, Bureau of Labor 

Statistics. According to the “Employer Costs for Employee Compensation–December 2014” news release, the rate 

for state and local government workers is $43.95, as accessed on April 3, 2015, through the BLS website at 

www.bls.gov/news.release/ecec.t04.htm. Refer to “Table 4. Employer costs per hour worked for employee 

compensation and costs as a percent of total compensation: State and local government workers, by occupational 

and industry group, December 2014.” 

6

 The cited ICR document similarly assumes 100 percent overhead for state and local agency labor. See 

section 6(b)(i) at p. 13.