United States Environmental Protection Agency, Region IX 

Air Division 

Technical Support Document 

for 

the EPA's Notice of Proposed Rulemaking 

for the 

California State Implementation Plan 

Mendocino County Air Pollution Control District 

Rule 1-130 – Definitions 

Rule 1-200 – Permit Requirements 

Rule 1-220 – New Source Review Standards 

Rule 1-230 – Action on Applications 

Laura Yannayon 

Reviewed by Gerardo Rios 

December 6, 2016 
Table of Contents 

1. Introduction .......................................................................................................................... 1

2. Submittal Information .......................................................................................................... 2

2.1. Submittal Agency ............................................................................................................. 2

2.2. Air Quality In Mendocino County ................................................................................... 2

2.3. Description of SIP Revision Submittal ............................................................................ 2

2.4. Completeness Determination ........................................................................................... 2

3. Rule Summaries ................................................................................................................... 3

3.1. Current SIP Approved Rules ............................................................................................ 3

3.2. Submitted Rules for SIP Approval ................................................................................... 3

3.3. Rule Revisions.................................................................................................................. 4

4. Permit Program Evaluations ................................................................................................ 5

4.1. General Permit Requirements for Minor and Major NSR ............................................... 6

4.2. Permit Requirements for Major Sources in Attainment Areas ...................................... 10

4.3. New Source Review Reforms ........................................................................................ 19

5. Clean Air Act Sections 110(l) and 193 .............................................................................. 23

5.1. Section 110(l) ................................................................................................................. 23

5.2. Section 193 ..................................................................................................................... 24

6. EPA’s Proposed Action ..................................................................................................... 24

6.1. Rule Deficiencies ........................................................................................................... 24

6.2. Recommendations for Rule Improvement ..................................................................... 24

7. Notes .................................................................................................................................. 25

 
1 

1. INTRODUCTION

This technical support document (TSD) focuses on the preconstruction permitting requirements 

for stationary sources, also called New Source Review or “NSR”, in title I of the Clean Air Act 

(CAA or the Act) and the Environmental Protection Agency’s (EPA) implementing regulations 

addressing the State Implementation Plan (SIP) requirements for state NSR programs at title 40 

of the Code of Federal Regulations (CFR) part 51, subpart I. This TSD will address the 

requirements for two of the three main components of the federal NSR program – Prevention of 

Significant Deterioration (PSD) and “minor source” or “general” NSR. It discusses the EPA’s 

findings on whether the rules and regulations related to NSR that have been submitted by the 

Mendocino County Air Quality Management District for approval into the California SIP meet 

federal NSR requirements. The TSD also discusses the EPA’s findings under Sections 110(l) and 

193 of the Act relevant to this action. 

The main components of the federal PSD and minor NSR program are briefly summarized as 

follows: 

PSD Program 

Part C of title I of the Act, and the implementing regulations at 40 CFR 51.166, contain the 

requirements for states to establish preconstruction permitting programs for the prevention of 

significant deterioration of air quality (PSD) in areas designated as attainment or unclassifiable 

for the national ambient air quality standards (NAAQS). The PSD program requirements under 

part C apply to major stationary sources and major modifications, as those terms are defined in 

40 CFR 51.166, at stationary sources located within attainment or unclassifiable areas. The PSD 

requirements apply to all regulated NSR pollutants as defined in 40 CFR 51.166, except those 

pollutants for which an area has been designated as nonattainment. 

Minor NSR or General NSR Program Requirements 

Section 110(a)(2)(C) of the Act requires that each SIP include a program to provide for 

“regulation of the modification and construction of any stationary source within the areas 

covered by the plan as necessary to assure that national ambient air quality standards are 

achieved, including a permit program as required in parts C and D” of title I of the Act. Thus, in 

addition to the permit programs required in parts C and D of title I of the Act, which apply to 

new major stationary sources and major modifications, each SIP must include a program 

regulating stationary sources with emissions below the major source thresholds. These general 

preconstruction requirements are commonly referred to as the “minor” or “general” NSR 

program requirements and are implemented through the EPA’s regulations at 40 CFR 51.160 

through 51.164. These more general program requirements are the only federal requirements that 

apply to these “minor” stationary sources and non-major modifications. These requirements also 

apply to major sources and major modifications, in addition to the more detailed requirements in 

parts C and D of the Act and their implementing regulations at 40 CFR 51.166 and 51.165, 

respectively. 
2 

2. SUBMITTAL INFORMATION

2.1. SUBMITTAL AGENCY

The Mendocino County Air Quality Management District (“MCAQMD” or “the District”) is the 

air pollution control agency for Mendocino County. 

2.2. AIR QUALITY IN MENDOCINO COUNTY

Mendocino County is designated attainment or unclassifiable for all NAAQS. (See 40 CFR 

81.305) Therefore, the PSD permit program requirements apply to new major stationary sources 

and major modifications at existing major stationary sources that emit these pollutants, as well as 

certain other pollutants, which are also regulated under the CAA. (See 40 CFR 51.166(b)(23)(i)) 

2.3. DESCRIPTION OF SIP REVISION SUBMITTAL

MCAQMD adopted revised permit program related rules to comply with the new federal PSD 

requirements applicable to PM2.5 and the general NSR program requirements. These rules were 

amended on the dates listed below in Table 1, and submitted to the EPA via the California Air 

Resources Board (CARB) on the submittal dates indicated in the table. CARB is the governor’s 

designee for submitting official revisions of the California State Implementation Plan (SIP) to 

the EPA. 

Table 1 –Submitted Rules 

Rule # Rule Title Amended Submitted 

1-130 Definitions 9/20/16 11/15/16 

1-200 Permit Requirements 9/20/16 11/15/16 

1-220 

New Source Review Standards (Including 

PSD Evaluations) 

9/20/16 11/15/16 

1-230 Action on Applications 9/20/16 11/15/16 

2.4. COMPLETENESS DETERMINATION 

With respect to procedures, CAA sections 110(a) and 110(l) require that revisions to a SIP be 

adopted by the state after reasonable notice and public hearing. The EPA has promulgated 

specific procedural requirements for SIP revisions in 40 CFR part 51, Subpart F. These 

requirements include publication of notices by prominent advertisement in the relevant 

geographic area, a public hearing on the proposed revisions, a public comment period of at least 

30 days, and an opportunity for a public hearing. Based on our review of the public process 

documentation included in the November 15, 2016 submittal, we find that MCAQMD has 

provided sufficient evidence of public notice and opportunity for comment and public hearings 

prior to adoption and submittal of these rules to the EPA. On December 5, 2016, we determined 

that CARB’s SIP submittal package conformed to the completeness criteria in 40 CFR part 51, 

appendix V, and was determined to be complete. 
3 

3. RULE SUMMARIES

3.1. CURRENT SIP APPROVED RULES 

The components of MCAQMD’s current SIP-approved PSD and general NSR program is 

contained in the rules listed in Table 2, which were SIP-approved on the dates listed. These rules 

contain both general and specific permit program requirements. 

Table 2 –SIP Approved Rules 

Rule # Rule Title 

SIP 

Approval 

Date 

Federal 

Register 

Citation 

1-130 Definitions 5/6/11 76 FR 26192 

1-200 Permit Requirements 4/12/89 54 FR 14650 

1-220 New Source Review Standards 7/31/85 50 FR 30942 

1-230 Action on Applications 7/31/85 50 FR 30942 

The EPA promulgated two rules to implement the new PM2.5 NAAQS, known as the NSR PM2.5

Implementation Rule (73 FR 28321, May 16, 2008) and the PM2.5 PSD Increments – Significant 

Impact Levels (SILs) – Significant Monitoring Concentration (SMC) Rule (75 FR 64864, 

October 20, 2010). In Sierra Club v. EPA, the Court issued a mandate vacating the portion of the 

rule establishing the PM2.5 SILs and SMC on March 19, 2013, as of which date the PM2.5 SILs 

and SMC in 40 CFR 52.21 were no longer in effect. The EPA codified this vacature by issuing a 

final rule removing the vacated elements on December 9, 2013. (78 FR 73698) On August 24, 

2016, the EPA promulgated an additional rule entitled Fine Particulate Matter National Ambient 

Air Quality Standards: State Implementation Plan Requirements. (81 FR 58010) In response to 

these new program requirements, MCAQMD has submitted the revised rules listed in Table 1. 

This TSD contains the EPA’s evaluation for the rules listed in Table 1. 

3.2. SUBMITTED RULES FOR SIP APPROVAL

Rule 1- 130 – Definitions

Rule 1-130 contains a list of 63 definitions used to carry out the District’s permit program. The 

rule also contains a general provision section which states that, except for the 63 listed 

definitions, all definitions included in 40 CFR 52.21(b), excluding the definition provided in 

subsection (b)(33) (Replacement Unit), are incorporated by reference into Rule 1-130. 

Rule 1-200 – Permit Requirements

Rule 1-200 contains the general requirements related to the District’s permitting program. 

Section (a) specifies that an Authority to Construct (ATC) shall be obtained from the District 

prior to beginning construction of any source that may emit air contaminants. Section (b) details 

the information required to be included with all applications. Section (c) lists the preliminary 

determinations that the Air Pollution Control Officer (APCO) must make prior to acting on an 

application for an ATC. Section (d) provides a list of the types of sources and equipment that is 

exempted from the requirement to obtain an ATC. Finally, Section (e) includes the criteria an 

application must meet to be considered complete and the timing for the APCO to make a 

completeness determination. 
4 

Rule 1-220 – New Source Review Standards (Including PSD Evaluations)

Rule 1-220 contains the specific standards/requirements under which all permits, including PSD 

permits must be evaluated. Section (a) specifies the information the applicant must submit for the 

APCO to perform the necessary emission analysis, as well as the basis for calculating emissions 

for new, existing and modified stationary sources. Section (b) specifies the criteria any source 

with an emission increase above the significant emission rates, as defined in Rule 1-130, must 

meet prior to issuance of the ATC. These include determining what level of control constitutes 

Best Available Control Technology (BACT), an air quality impact analysis, an analysis of stack 

height, and providing a public notice regarding the proposed permit action (including 

administrative requirements for providing such notice). Section (c) includes specific additional 

requirements for applications to construct power plants that will be licensed by the California 

Energy Commission. 

Rule 1-230 – Action on Applications

Rule 1-230 provides a list of administrative steps the APCO must take, including making 

specific determinations, prior to issuing an ATC. Section (a) includes the general approval 

criteria that the APCO must ensure have been meet prior to issuing the ATC. Section (b) 

provides that when the public notice is provided as required by Rule 1-220, the APCO shall also 

send copies of the proposed permit and preliminary decision regarding the ATC to both the 

CARB and the EPA, and that the permit may not be issued for at least 30 days after the public 

notice is published. Sections (c) and (d) specify what actions the APCO must take if he intends to 

deny or conditionally approve the ATC, respectively. Finally, section (e) provides that the 

issuance of an ATC does not relive the permit holder from complying with all other applicable 

regulations. 

3.3. RULE REVISIONS

The District’s staff report states that the main reason for revising Rules 1-130, 1-200, 1-220 and 

1-230 is to update their Prevention of Significant Deterioration Program, which was last 

approved by the EPA in 1985. The rule revisions incorporate new and updated program 

definitions, requirements and procedures required for a federally approved PSD program. 

One editorial change in the rules is to remove all dates associated with cited provisions of the 

federal regulations. The provisions cited from 40 CFR 52.21 were (and are) for reference only, 

the provisions are not incorporated by reference, and therefore the dates had no meaning, but 

created confusion in the rule. Thus the removal of these dates strengthens the rules by providing 

additional clarity. 

Below, we discuss the rule revisions generally and evaluate whether the revised rules meet the 

applicable program requirements in Section 4 of this TSD. 

Rule 1-130 – Definitions

The submitted rule has been revised significantly by incorporating most of the definitions 

contained in 40 CFR 52.21(b) by reference. These incorporated definitions apply unless a 

definition is provided for the same term in Rule 1-130. The submitted rule also includes several 
5 

new definitions to take the place of the definitions contained in 40 CFR 52.21 to ensure the rule 

implements a PSD program that does not include any of the NSR reform provisions adopted by 

the EPA in 2003. A complete evaluation of the definitions provided in this rule is provided in 

Section 4.2 of this TSD, titled Permit Requirements for Major Sources in Attainment Areas, 

which evaluates all of the requirements of a PSD program pursuant to the requirements of 40 

CFR 51.166. 

Rule 1-200 – Permit Requirements

The submitted rule has been updated to clarify certain exemptions and add a new Section (e) 

Procedures. The permit exemption provided in Section (d)(5) has been revised to make it 

consistent with state law provisions contained in SB700. The language provided in the 

exemption provisions contained in Section (d)(8) has been revised to limit the scope of director’s 

discretion. The provisions contained in new Section (e) detail the information an applicant must 

provide for an application to be deemed complete and other administrative requirements. The 

new language and minor edits to the rule generally provide additional clarity and enforceability 

and are therefore acceptable revisions. 

Rule 1-220 – New Source Review Standards (Including PSD Evaluations)

The new language, evaluation criteria and minor revisions are clarifying in nature and are 

generally consistent with the requirements of 40 CFR Part 51 Subpart I. Therefore, these 

revisions are acceptable. 

Rule 1-230 – Action on Applications 

The submitted rule has been updated to clarify that the assessment of air quality deterioration is 

cumulative in nature and adds a new Section (e) Performance Standards in Effect. These 

revisions are acceptable. 

4. PERMIT PROGRAM EVALUATIONS

For this technical support document, we reviewed the submitted minor NSR and PSD rules for 

compliance with the CAA requirements for SIPs in general as set forth in CAA section 

110(a)(2), the requirements for stationary source preconstruction permitting programs in 40 CFR 

part 51, subpart I (Review of New Sources and Modifications), excluding section 51.165 which 

contains the nonattainment NSR program requirements, and the requirements related to SIP 

revisions in CAA sections 110(l) and 193. The EPA also relied on the following documents in 

the review of the District’s overall permitting regulations: 

• General Preamble for the Implementation of Title I of the Clean Air Act Amendments of 

1990 (57 FR 13498, April 16, 1992), 

• the NSR PM2.5 Implementation Rule (73 FR 28321, May 16, 2008), the PM2.5 PSD 

Increments – Significant Impact Levels (SILs) – Significant Monitoring Concentration 

(SMC) Rule (75 FR 64864, October 20, 2010), and 

• the Fine Particulate Matter National Ambient Air Quality Standards: State 

Implementation Plan Requirements Rule (81 FR 58010, August 24, 2016) in the review 

of the District’s overall permitting regulations. 

The EPA has condensed the approval criteria contained in these various materials in this TSD, 
6 

which describes reasons for our proposed action on the SIP submittals for MCAQMD. 

4.1. GENERAL PERMIT REQUIREMENTS FOR MINOR AND MAJOR NSR 

We reviewed the submitted rules for compliance with the EPA regulations for permit programs 

found in 40 CFR 51, subpart I, excluding 40 CFR 51.165 and 51.166, which apply only to new 

major sources and major modifications under parts C and D of title I of the CAA. 

1. 40 CFR 51.160 – Legally enforceable procedures 

(a) Each plan must set forth legally enforceable procedures that enable the State or local 

agency to determine whether the construction or modification of a facility, building, 

structure or installation or combination of these will result in (1) a violation of applicable 

portions of the control strategy; or (2) interference with attainment or maintenance of a 

national standard in the state in which the proposed source (or modification) is located or 

in a neighboring State. 

Discussion: Rule 1-200 – Permit Requirements, Section (b) specifies the application 

requirements, including the requirement to provide all information necessary for the 

District to make determinations required by Rule 1-230 – Action on Applications, which 

generally satisfies the requirement to set forth the legally enforceable procedures. In 

addition, Rule 1-230 Section (a)(1) specifies that the APCO may only issue an ATC if the 

source is in compliance with all applicable rules and regulations. Likewise, Section (a)(2) 

specifies that the APCO may only issue an ATC if the emissions from a new or modified 

stationary source do not prevent attainment, interfere with maintenance or cause a 

violation of an ambient air quality standard. Taken together, these provisions are 

acceptable to satisfy this requirement. 

(b) Such procedures must include means by which the State or local agency responsible 

for final decision-making on the application for approval to construct or modify will 

prevent such construction or modification if (1) it will result in a violation of applicable 

portions of the control strategy; or (2) it will interfere with the attainment or maintenance 

of a national standard. 

Discussion: Rule 1-200 – Permit Requirements, Section (a), prohibits construction and 

operation of any source unless an ATC has been obtained from the District. The District 

may grant ATCs only after verifying the new project will comply with all applicable rules 

and regulations and will not interfere with attainment or maintenance of the NAAQS (See 

paragraph (a) above for summary of these requirements). These provisions are acceptable 

to satisfy this requirement. 

(c) The procedures must provide for the submission, by the owner of operator of the 

building, facility, structure, or installation to be constructed or modified, of such 

information on (1) the nature and amounts of emissions to be emitted by it or emitted by 

associated mobile sources; (2) the location, design, construction, and operation of such 
7 

facility, building, structure, or installation as may be necessary to permit the state or local 

agency to make the determination referred to in paragraph (a) of this section. 

Discussion: Rule 1-200 – Permit Requirements, specifies the application submittal 

requirements for an application to be deemed complete. Specifically, Section (e) specifies 

that the application must include all information necessary to determine compliance with 

all applicable requirements. This provision is acceptable to satisfy this requirement. 

(d) The procedures must provide that approval of any construction or modification must 

not affect the responsibility on the owner or operator to comply with applicable portions 

of the control strategy. 

Discussion: Rule 1-230 – Action on Applications, Section (e) states “The issuance of an 

Authority to Construct does not relieve the permit holder of the requirements to comply 

with all applicable rules and regulations, including emission limitations and other 

performance standards, whether or not such limitations and standards are explicitly stated 

or referenced in the permit.” This provision is acceptable to satisfy this requirement. 

(e) The procedures must identify types and sizes of facilities, buildings, structures, or 

installations which will be subject to review under this section. The plan must discuss the 

basis for determining which facilities will be subject to review. 

Discussion: Rule 1-200 – Permit Requirements, Section (a), prohibits construction and 

operation of any source unless an ATC has been obtained from the District. Section (d) 

provides a list of specific equipment and operations which are exempted from the 

requirement to obtain an ATC prior to construction. Taken together, these provisions are 

acceptable to satisfy this requirement. 

(f) The procedures must discuss the air quality data and the dispersion or other air quality 

modeling used to meet the requirements of this subpart. (1) All applications of air quality 

modeling involved in this subpart shall be based on the applicable models, data bases, 

and other requirements specified in appendix W of this part (Guidelines on Air Quality 

Models). (2) Where an air quality model specified in appendix W of this part (Guideline 

on Air Quality Models) is inappropriate, the model may be modified or another model 

substituted. Such a modification or substitution of a model may be made on a case-bycase basis or, where appropriate, on a generic basis for a specific State program. Written 

approval of the EPA must be obtained for any modification or substitution. In addition, 

use of a modified or substituted model must be subject to notice and opportunity for 

public comment under procedures set forth in 40 CFR 51.102. 

Discussion: The submitted rules do not contain any provisions to address this 

requirement. We also reviewed rules already approved into the SIP, but could not find 

any provisions to satisfy this requirement. Therefore, we are identifying the absence of 

such a provision as a deficiency and proposing to disapprove Rule 1-220 with respect to 

this requirement. 
8 

2. 40 CFR 51.161 – Public availability of information 

(a) The legally enforceable procedures in 40 CFR 51.160 must also require the state or 

local agency to provide opportunity for public comment on information submitted by 

owners and operators. The public information must include the agency’s analysis of the 

effect of construction or modification on ambient air quality, including the agency’s 

proposed approval or disapproval. 

Discussion: Rule 1-220 – New Source Review Standards, Subsection (b)(6) requires the 

District to “Make available for public inspection at the District office, the information 

submitted by the applicant, the analysis of the effect of the source on air quality, and the 

preliminary decision to grant or deny the Authority to Construct.” Subsection (b)(5) 

requires the published notice to “...allow 30 days beginning on the date of publication, 

for the public to submit written comments on the proposed Authority to Construct.” 

Taken together, these provisions are acceptable to satisfy this requirement. 

(b) For the purposes of paragraph (a) of this section, opportunity for public comment 

shall include, as a minimum, (1) Availability for public inspection in at least one location 

in the area affected of the information submitted by the owner or operator and of the State 

or local agency’s analysis of the effect on air quality; (2) A 30-day period for submittal of 

public comment; and (3) A notice by prominent advertisement in the area affected of the 

location of the source information and analysis specified in paragraph (b)(1) of this 

section. 

Discussion: Rule 1-220 – New Source Review Standards, Subsection (b)(5) requires the 

public notice to be published by prominent advertisement in at least one newspaper of 

general circulation, that the notice must state where the public may inspect the 

information required to be provided and allow 30 days for the public to submit written 

comments. This provision is acceptable to satisfy this requirement. 

The requirement to provide a public notice is triggered at the following thresholds: 40 

tons per year (tpy) for NOx, VOC and SOx, 25 tpy for PM, 15 tpy for PM10, 10 tpy for 

PM2.5, 100 tpy for CO and 0.55 tpy for lead. These are the same emission rates which are 

defined as significant in the PSD program. (See 51.166(b)(23)(i)) These public notice 

thresholds have been in place since at least 1986. The MCAQMD has continued to attain 

the NAAQS even as the EPA has promulgated more stringent NAAQS. Therefore, the 

EPA agrees with the District that these thresholds remain a reasonable threshold for 

requiring public notice of proposed permit actions. 

(c) Where the 30-day comment period required in paragraph (b) of this section would 

conflict with existing requirements for acting on requests for permission to construct or 

modify, the State may submit for approval a comment period which is consistent with 

such existing requirements. 

Discussion: This is a discretionary component of a permit program that MCAQMD’s 

submitted regulations do not contain. All permits subject to public notice requirements 
9 

under Rule 1-220 are subject to a 30-day public comment period. This is acceptable. 

(d) A copy of the notice required by paragraph (b) of this section must also be sent to the 

EPA through the appropriate Regional Office, and to all other state and local air pollution 

control agencies having jurisdiction in the region in which such new or modified 

installation will be located. The notice also must be sent to any other agency in the region 

having responsibility for implementing the procedures required under this subpart. For 

lead, a copy of the notice is required for all point sources. The definition of point source 

for lead is given in 40 CFR 51.100(k)(2). 

Discussion: Rule 1-220 – New Source Review Standards, Subsection (b)(7) requires the 

District to send a copy of the required notice, including information submitted by the 

applicant, the District’s analysis and a copy of the proposed permit to the ARB, the EPA 

and any other air district in the same air basin or adjoining the District. This provision is 

acceptable to satisfy the first part of this requirement. The second part of this provision 

requires public notice for all point sources of lead emissions, which 40 CFR 51.100(k)(2) 

defines as a source emitting 5 tpy or more of lead. Rule 1-220(b)(5) requires a public 

notice be provided for all projects with a “net emission increase of any pollutant which 

exceeds the significant emission rates as specified in Rule 1-130(s2).” The significant 

rate listed for lead is 3 lbs per day or 0.55 tpy, which is significantly lower than the 

required 5 tpy threshold. Therefore, we find that this provision satisfies the second part of 

this requirement. 

3. 40 CFR 51.162 – Identification of responsible agency 

Each plan must identify the state or local agency which will be responsible for meeting 

the requirements of this subpart in each area of the state. Where such responsibility rests 

with an agency other than an air pollution control agency, such agency will consult with 

the appropriate state or local air pollution control agency in carrying out the provisions of 

this subpart. 

Discussion: California law provides for the creation and authority of each air District. 

(See H&SC Division 26, Part 3) California law specifically provides that “Local and 

regional authorities [e.g., the Districts] have the primary responsibility for control of air 

pollution from all sources other than vehicular sources.” (See CH&SC § 39002) 

Accordingly, the California SIP has been divided into sections for each of the 35 state 

permitting authorities. Each District that adopts rules and regulations and submits them 

for SIP approval is responsible for implementing and enforcing those submitted rules. For 

the rules under review, all of the rules were adopted and submitted by the MCAQMD. 

4. 40 CFR 51.163 – Administrative procedures 

The plan must include the administrative procedures, which will be followed in making 

the determinations specified in paragraph (a) of 40 CFR 51.160. 

Discussion: Rule 1-200 – Permit Requirements, Section (b) requires the applicant to 
10 

provide all of the information necessary to enable the District to deem the application 

complete, as specified in Section (e). This ensures the District has all of the information 

necessary to make the required determinations specified in paragraph (a) of 40 CFR 

51.160. This provision satisfies this requirement. 

5. 40 CFR 51.164 – Stack height procedures 

Such procedures must provide that the degree of emission limitation required of any 

source for control of any air pollutant must not be affected by so much of any source’s 

stack height that exceeds good engineering practice or by any other dispersion technique, 

except as provided in 40 CFR 51.118(b). Such procedures must provide that before a 

State issues a permit to a source based on a good engineering practice stack height that 

exceeds the height allowed by 40 CFR 51.100(ii)(1) or (2), the State must notify the 

public of the availability of the demonstration study and must provide opportunity for 

public hearing on it. This section does not require such procedures to restrict in any 

manner the actual stack height of any source. 

Discussion: Rule 1-220 – New Source Review Standards, Subsection (b)(3) states that the 

APCO shall “Determine that the degree of emission limitation required for control of any 

air pollutant is not affected in any manner by- (A) So much of the stack height of any 

source as exceeds good engineering practice, or (B) Any other dispersion technique.” 

This provision otherwise satisfies this requirement. 

4.2. PERMIT REQUIREMENTS FOR MAJOR SOURCES IN ATTAINMENT AREAS

The EPA approved MCAQMD’s existing SIP-approved PSD program on July 31, 1985 (50 FR 

30942). As discussed in the introduction section of this TSD, state/local PSD programs must 

comply with the provisions contained in 40 CFR 51.166. We discuss below the criteria for 

approval of a state/local PSD permitting program and our evaluation of MCAQMD’s PSD 

program submittal in accordance with these requirements. 

1. Provisions, pursuant to 40 CFR 51.166(a)(7), which incorporate the requirements in (a)(7)(i) 

through (a)(7)(vi), as listed below, regarding applicability of PSD program requirements. 

a. 40 CFR 51.166(a)(7)(i) specifies that the PSD program must apply to the construction of 

any new major stationary source or any project at an existing major stationary source in 

areas designated attainment or unclassifiable. 

Discussion: Rule 1-200 – Permit Requirements, Section (a) requires an ATC prior to 

construction of any emission unit, unless specifically exempted from this requirement 

under Section (d) of Rule 1-200. Rule 1-220 Section (b) requires any new or modified 

source that will result in a significant net emissions increase (as defined in Rule 1-130 

(s2)), to comply with all the listed requirements of Section (b). This provision ensures 

that any project with a net emission increase above the specified significant emission 

thresholds, whether at a major or non-major source, trigger the key PSD program 
11 

requirements, including BACT, an Air Quality Impact Analysis, a Visibility, Soils, and 

Vegetation Analysis, and an Increment analysis. Taken together, Rules 1-200 and 1-220 

require PSD program elements to be applied to all new sources and modifications with 

significant net emission increases. This is more stringent than the regulatory requirement 

for these provisions to apply to new major stationary sources and major modifications. 

These provisions satisfy this requirement. 

b. 40 CFR 51.166(a)(7)(ii) specifies that the PSD program must apply the requirements of 

40 CFR 51.166 (j) through (r) to the construction of any new major stationary source or 

the major modification of any existing major stationary source. 

Discussion: We evaluate the requirements of paragraphs (j) through (r), individually 

below. 

c. 40 CFR 51.166(a)(7)(iii) specifies that the PSD program must prohibit the construction of 

a new major stationary source or major modification to which the requirements of 

paragraphs (j) through (r)(5) apply, without a permit ensuring compliance with those 

requirements. 

Discussion: Rule 1-230 – Action on Applications, Section (c), Denial of Application, 

states that the APCO shall deny an application for an ATC unless the new or modified 

source complies with all requirements specified in Rule 1-230. Rule 1-230 Subsection (a) 

sets out the requirements that must be met to ensure compliance with requirements of 40 

CFR 51.166 paragraphs (j) through (r)(5). These provisions satisfy this requirement. 

d. 40 CFR 51.166(a)(7)(iv) specifies that the PSD program must use the specific provisions 

contained in paragraphs (a)(7)(iv)(a) through (f) to determine emission increases, unless 

the State demonstrates that the submitted provisions are at least as stringent in all 

respects. 

Discussion: Rule 1-220 – New Source Review Standards, does not include provisions 

that match those found in paragraphs (a)(7)(iv)(a) through (f). However, the EPA has 

determined that Rule 1-220 Section (b) provides provisions that are at least as stringent 

(e.g., all PSD program requirements, including BACT are triggered at lower emission 

thresholds). Therefore, we find that Rule 1-220 satisfies this requirement. 

e. 40 CFR 51.166(a)(7)(v) specifies that a PSD program must contain provisions requiring a 

source seeking a PAL for a regulated NSR pollutant to comply with the requirements of 

40 CFR 51.166(w). 

Discussion: The District’s rules do not contain any provisions pertaining to PALs. While 

the lack of such provisions does not provide the additional flexibility the EPA intended 

for the PSD program, we have found that in California, due to the more stringent 

requirements of the California Clean Air Act, that sources would not be able to utilize 

these flexibilities. See Section 4.3 of this TSD, titled New Source Review Reforms, for 

additional information. Therefore, we find that it is acceptable for the District’s rules to 
12 

not contain any provisions for PALs. 

2. Applicable definitions found in CAA sections 169 and 169A(g), and in 40 CFR 51.100 and 

51.166(b). 

Discussion: Rule 1-130 – Definitions, incorporates by reference all of the 40 CFR 52.21 (b) 

definitions (excluding the definition for the term “Replacement Unit” found in 52.21(b)(33)), 

except where a specific definition for the term is provided in the rule. To the extent the rule 

specifically incorporates the definitions found in 40 CFR 52.21, these definitions satisfy the 

regulatory requirement to include the definitions found in 40 CFR 51.166 into the District’s 

rules. We have also reviewed the specific definitions found in Rule 1-130 and found that in 

most cases, these definitions are either identical or nearly identical to the definitions in the 

CAA and the EPA’s implementing regulations. In some cases, however, the definitions do 

not track the language in the federal definitions as closely. We explain below in more detail 

our proposed determinations as to whether these differing definitions are equivalent to the 

federal definitions and, therefore, adequate to meet these requirements of a PSD program. 

a. Definitions That Differ From the EPA Definitions in 40 CFR 51.166 

Actual Emissions 

Discussion: The definition of this term is provided in Section (a1) of Rule 1-130. The 

provided definition revises the definition for the term Actual Emissions currently found 

in 40 CFR 52.21(b)(21) to incorporate most of the definition of the term Actual 

Emissions as it existed in 40 CFR 52.21(b)(21) prior to December 31, 2002, when the 

EPA revised the definition through rulemaking as part of NSR Reform. The District’s 

revised definition does not contain any provisions for electric utility steam generating 

units. While this revised definition does not provide the additional flexibility the EPA 

intended for the PSD program, we have found that in California, due to the more 

stringent requirements of the California Clean Air Act, that sources would not be able to 

utilize these flexibilities. See Section 4.3 of this TSD, titled New Source Review 

Reforms, for additional information. Therefore, we find the definition provided is 

adequate to satisfy the requirement for this term to be defined. 

Baseline Actual Emissions 

Discussion: The definition of this term is provided in Section (b1) of Rule 1-130. The 

provided definition revises the definition for the term Baseline Actual Emissions 

currently found in 40 CFR 52.21(b)(48) to the definition of the term Actual Emissions as 

it is defined in Section (a1) of Rule 1-130. While this revised definition does not provide 

the additional flexibility the EPA intended for the PSD program under NSR Reform, we 

have found that in California, due to the more stringent requirements of the California 

Clean Air Act, that sources would not be able to utilize these flexibilities. See Section 4.3 

of this TSD, titled New Source Review Reforms, for additional information. Therefore, 

we find the definition provided is adequate to satisfy the requirement for this term to be 

defined. 
13 

Baseline Concentration 

Discussion: The definition of this term is provided in Section (b2) of Rule 1-130. The 

provided definition is essentially the same as the definition found in 40 CFR 

52.21(b)(13), except it does not contain the references to the definition of “actual 

emissions” found in 52.21(b)(21). We find this acceptable because the District has 

provided its own definition for the term Actual Emissions, which we find to be consistent 

with the definition in 52.21(b)(21). 

Best Available Control Technology 

Discussion: The definition of this term is provided in Section (b4) of Rule 1-130. While 

the definition varies somewhat from the federal definition, it is functionally the same and 

fulfills the requirement for providing a definition for this term. 

Major Stationary Source 

Discussion: The definition of this term is provided in Section (m2) of Rule 1-130. The 

definition found in 40 CFR 51.166(b)(iv) for this term has been revised to read as 

follows: “Any stationary source which emits, or has the potential to emit, a regulated 

pollutant above which exceeds the significant emission rates specified in Rule 1-

130(s2).” The effect of this language is to lower the major source thresholds of 100 or 

250 tpy specified in the federal definition of the term, down to the lower significant 

emission rates specified in the rule. Since this definition creates lower applicability 

thresholds, it ensures that at least all projects that would be classified as a major source 

under the federal definition will be subject to PSD program requirements. Therefore, we 

find this definition acceptable. 

Major Modification 

Discussion: The definition of this term is provided in Section (m1) of Rule 1-130. The 

definition found in 40 CFR 51.166(b)(v) for this term has been revised to read as: “any 

physical change in or change in the method of operation that would result in increase of a 

regulated pollutant which exceeds the significant emission rates specified in Rule 1-

130(s2).” The effect of this language is to require any existing source, not just major 

sources, to be subject to PSD program requirements if the increase from a project exceeds 

the significant emission rates specified in the rule. Since this definition subjects’ minor 

sources to PSD major source program requirements and it contains the same threshold for 

major sources, it ensures that all projects which would be subject to PSD requirements 

under the federal definition will also be subject under the District’s rules. Therefore, we 

find this definition acceptable. 

Net Emissions Increase 

Discussion: The definition of this term provided in Section (n1) of Rule 1-130. The 

provided definition revises the definition for the term Net Emissions Increase currently 

found in 40 CFR 52.21(b)(21) to make it more closely match the definition of the term 

Net Emissions Increase as it existed in 40 CFR 52.21(b)(21) prior to December 31, 2002, 

when the EPA revised the definition through rulemaking as part of NSR Reform. The 

revised definition removes all references to Baseline Actual Emissions and other new 

terms added by NSR Reform. While this revised definition does not provide the 
14 

additional flexibility the EPA intended for the PSD program, we have found that in 

California, due to the more stringent requirements of the California Clean Air Act, that 

sources would not be able to utilize these flexibilities. See Section 4.3 of this TSD, titled 

New Source Review Reforms, for additional information. Therefore, we find the 

definition provided is adequate to satisfy the requirement for this term to be defined. 

Potential to Emit 

Discussion: The definition of this term is provided in Section (p5) of Rule 1-130. While 

the definition varies somewhat from the federal definition, it is substantially similar and 

fulfills the requirement for providing a definition for this term. 

Reviewing Authority 

Discussion: Because Rule 1-130 – Definitions, incorporates the definitions of 40 CFR 

52.21 by reference, the term “reviewing authority” in 40 CFR 51.166 is replaced with the 

term Administrator. Rule 1-130 provides language under the general provisions to clarify 

when the term Administrator as used in the incorporated definitions refers to the EPA 

Administrator and when it refers to the APCO. Therefore, we find that this provision 

provides an adequate definition for the term Reviewing Authority. 

Significant 

Discussion: The definition of this term is provided in Section (s2) of Rule 1-130. The 

definition provided is nearly identical to the definition provided in 51.166(b)(23), but it 

lists the Significant Emission Rates in terms of lbs per day. The rates listed in Rule 1-130 

are equivalent to or more stringent than the required tons per year rates. Therefore, we 

find this definition acceptable. 

Subject to Regulation 

Discussion: The definition of this term is provided in Section (s9) of Rule 1-130. The 

definition of the term found in 40 CFR 51.166(b)(49) has been changed in two ways. 

First it revises paragraph (ii)(a) to remove the second sentence, which deferred the 

regulations of various biogas emissions until July 21, 2014. Second, the definition deletes 

paragraph (v) from the incorporated by reference definition of “Subject to Regulation”. 

This revision is consistent with the EPA’s August 19, 2015 rulemaking which also 

removed this provision.1

 Therefore we find the definition provided satisfies the 

requirement for this term to be defined. 

b. Additional terms defined in Rule 1-130 

Discussion: The following terms are defined in Rule 1-130 but are not specifically 

defined in the EPA’s regulations in 40 CFR 51.100 or 51.166. The EPA has reviewed 

these terms and believes that they strengthen the program by providing clear definitions 

for terms used in Rules 1-200, 1-220 and 1-230. Therefore, the inclusion of these defined 

terms is acceptable. 

 

1 80 FR 50199 
15 

These terms include the following: Agricultural Operation, Air Contaminant, Air 

Pollution Abatement Operation, Air Pollution Control Officer, Ambient Air Quality 

Standard, Approved Combustibles, Area Classifications, Base Unit, CAAA, CAPCOA, 

CCAA, CFR, Combustion Contaminants, Compression Ignition, Control Strategy, 

District, Dust, Emission, Episode Alert, Fumes, Geothermal Operations, Greenhouse 

Gases (GHGs), Hearing Board, Impact/Baseline Area, Indirect Source, Installation, Large 

Grading Operation, Maximum Achievable Control Technology (MACT), Modeling, 

Modification, Operation, Orchard, Vineyard, or Citrus Grove Heater, Organic Gas, 

Owner, Permit, Person Or Persons, Portable Source, PPM, Precursor, Prevention of 

Significant Deterioration (PSD) Increment, Process Weight Per Hour, Section, Stacking, 

Standard Conditions, Standard Cubic Meter of Gas (Standard Cubic Foot of Gas), Steam 

Generating Unit, Total Reduced Sulfur (TRS), Toxic Air Contaminant (TAC), Trade 

Secrets, and URBEMIS. 

3. Provisions which establish the maximum allowable ambient air increments and ambient air 

ceilings as set forth in 40 CFR 51.166(c) and (d), for any designated attainment or 

unclassifiable area. 

Discussion: Rule 1-130, paragraph (p7) provides a definition for “Prevention of Significant 

Deterioration Increment” which provides a table of the allowable air quality increments for 

all of the pollutants listed in 40 CFR 51.166(c) and (d). This provision is acceptable to satisfy 

this requirement. 

4. Provisions concerning the initial designation of all attainment areas as Class I, II, or III, as 

listed in 40 CFR 51.166(e) and (g). 

Discussion: Rule 1-130, Subsection (a9) provides a definition for the term Area 

Classifications. This definition provides that all areas designated as Class I areas pursuant to 

40 CFR 52.21(e) are Class I areas and that all other areas not so designated are Class II areas. 

This definition is sufficient to satisfy this requirement. 

5. Provisions, pursuant to 40 CFR 51.166(h), to assure that the degree of emission limitation 

required of any source for control of any air pollutant must not be affected by so much of any 

source's stack height that exceeds good engineering practice. 

Discussion: Rule 1-220, Subsection (b)(3) addresses this requirement. It requires the APCO 

to “Determine that the degree of emission limitation required for control of any air pollutant 

is not affected in any manner by; (A) So much of the stack height of any source as exceeds 

good engineering practice, or (B) Any other dispersion technique.” This provision satisfies 

this requirement. 

6. Provisions, pursuant to 40 CFR 51.166(i), which allow for specified exemptions from the 

PSD program at the State’s election. 

Discussion: Rules 1-200, 1-220 and 1-230 do not contain any of the specific exemptions 

allowed under 40 CFR 51.166(i), but since these are optional exemptions, not including them 
16 

is not a program deficiency. Rule 1-200 does contain several exemptions from the 

requirement to obtain an ATC, but these exemptions are tailored to only apply to non-major 

sources, which are not subject to the requirements of 40 CFR 51.166. Therefore, the 

submitted rules satisfy this optional provision. 

7. Provisions, pursuant to 40 CFR 51.166(j), which require BACT, determined on a case-bycase basis, for a new major source or major modification. 

Discussion: Rule 1-220, Section (b)(1) requires BACT for all new or modified sources which 

have a significant net emission increase for the listed pollutants, as determined by the 

definition of the term “significant” defined in Rule 1-130 (s2). We note that the significant 

net emission increase applicability threshold is not limited to major modifications, but 

applies to all projects. Therefore, these provisions satisfy the requirement to require BACT 

for all new major sources and major modifications. 

8. Provisions, pursuant to 40 CFR 51.166(k), which address the demonstration required from a 

source impact analysis. This includes showing that the allowable emission increases from the 

project and all other applicable emissions increases or reductions, would not cause or 

contribute to air pollution in violation of any NAAQS or any increment. 

Discussion: Rule 1-220 paragraph (b)(4) requires that an Air Quality Analysis be performed. 

The analysis must consider the effects of the emission changes from the project on air quality 

and the PSD increments. Rule 1-230 paragraphs (a)(2) and (3) provides that the APCO may 

only grant the ATC after determining that the project “will not prevent the attainment, 

interfere with the maintenance, or cause a violation, of any state or national ambient air 

quality standard” and “will not cause cumulative deterioration of existing air quality in 

excess of 50% of remaining available PSD increments as defined in Rule 1-130(p7).” Taken 

together these provisions satisfy the regulatory requirement. 

9. Provisions pursuant to 40 CFR 51.166(l) requiring air quality modeling consistent with the 

applicable requirements of appendix W of 40 CFR part 51 (“Guideline on Air Quality 

Models”), and provisions pursuant to 40 CFR 51.166(m) to assure that a major source or 

major modification will perform an air quality analysis, including pre-application air 

monitoring for any pollutant for which the net emissions increase of the source or 

modification is significant, and post-construction monitoring as necessary to determine the 

effect the emissions may have, or are having, on air quality in any area. 

Discussion: While Rule 1-220 (b)(4) requires the APCO to prepare or cause to be prepared 

an air quality analysis that includes continuous air monitoring consistent with the provisions 

of 40 CFR 52.21(m) (which are identical to the requirements found in 51.166(m)), the rule 

does not contain any requirements regarding the types of air quality models to be used, as 

required by 40 CFR 51.166(l). Therefore, we find the submitted rules deficient in regards to 

meeting the requirements of 40 CFR 51.166(l). 

10. Provisions, pursuant to 40 CFR 51.166(m), requiring the submission of a pre-application 

analysis of ambient air quality monitoring data for each pollutant affected by the project. 
17 

Discussion: Rule 1-220 Section (b)(4)(A) requires an applicant to submit an air quality 

analysis that includes continuous air monitoring, consistent with the requirements of 40 CFR 

52.21(m). The requirements of 40 CFR 52.21(m) are identical to the requirements of 40 CFR 

51.166(m), therefore this provision satisfies this requirement. 

11. Provisions, pursuant to 40 CFR 51.166(n), requiring the submission of all information 

necessary to perform any analysis or make any determination required under the PSD 

program. 

Discussion: Rule 1-220 Section (a) requires an applicant to submit information sufficient to 

make any approval determinations required by Rule 1-230, which includes PSD compliance 

determinations regarding PSD increments, BACT and compliance with the NAAQS. This 

provision satisfies this requirement. 

12. Provisions, pursuant to 40 CFR 51.166(o), to assure that the owner of operator of a major 

source or major modification will perform additional impact analyses of the impairment to 

visibility, soils, and vegetation and the air quality impact projected for the area as a result of 

general commercial, residential, industrial and other growth associated with the source or 

modification. 

Discussion: Rule 1-220 paragraph (b)(4)(E) requires an analysis and evaluation of the 

impairment to visibility, soils and vegetation and the impact projected for the area as a result 

of general commercial, residential, industrial and other growth associated with the source or 

modification. This provision satisfies this requirement. 

13. Provisions to assure protection of air quality related values (including visibility) in Class I 

areas pursuant to 40 CFR 51.166(p) and 51.307. 

Discussion: Rule 1-220 paragraph (b)(4)(D) requires an analysis of the expected impacts on 

air quality related values in any Class I areas for new and modified major stationary sources. 

In addition, Rule 1-220 paragraph (b)(9) requires the APCO to transmit copies of the 

application and notice of action to the Federal Land Manager (FLM) of any Class I area, and 

to consider any adverse impacts demonstrated by the FLM if the analysis shows that a new 

major source or major modification may affect visibility in any Federal Class I area. These 

provisions satisfy these requirements. 

14. Provisions to assure agency and public participation under 40 CFR sections 51.166(p)(1) and 

51.166(q). 

Discussion: 40 CFR 51.166(p)(1) requires the PSD reviewing authority to transmit to the 

EPA a copy of each permit application relating to a major new source or major modification 

and to provide notice to the EPA of every action related to the consideration of such permit. 

Rule 1-220 (b)(9) requires the District to transmit copies of the application and notice of each 

action affecting the application to the EPA. This provision provides for the necessary 
18 

coordination with the EPA. 

Discussion: 40 CFR 51.166(q) contains several provisions pertaining to public participation. 

These include a timeline for determining and notifying the source if their application is 

complete, taking action on the permit within one year of it being deemed complete, public 

notice requirements, notifying the EPA and other interested parties of the proposal and 

providing opportunity for a public hearing. It also requires the permit authority to consider all 

of the written comments and make a final determination on the proposed permit, and notify 

the applicant of the final decision. 

Rule 1-200 Section (e) contain the provisions for determining if an application is complete. 

Paragraph (2) of this section specifies that the APCO must notify the applicant within 30 

days as to whether the application is complete. Rule 1-240 – Permit to Operate, Section (c) 

specifies that the APCO must take a final permit action within 180 days after determining the 

application complete. Rule 1-220 Paragraphs (b)(5)-(11) specify these public notice 

requirements. Paragraph (b)(5) requires the APCO to publish a 30-day public notice in the 

paper stating where the public may inspect the application and draft permit and how to 

submit comments. It also specifies the details which must be included in the notice such as 

expected air quality impacts and the opportunity for a public hearing on the project. Rule 1-

220(b)(7) requires the APCO to forward copies of the application analysis and the draft 

permit to the EPA, CARB and other Districts and certain federal land managers. Section 

(b)(10) requires the District to consider all comments and make the comments and final 

permit available for public inspection. Rule 1-220 requires the APCO to publish a newspaper 

notice within 30 days after issuing the ATC. These provisions satisfy the regulatory 

requirement. 

15. Provisions, pursuant to 40 CFR 51.166(r), which address source obligation requirements. 

Discussion: Rule 1-230 Section (e) specifies that the issuance of an Authority to Construct 

does not relieve the permit holder from other applicable requirements as required by 

paragraph 40 CFR 51.166(r)(1), therefore this requirement is satisfied. Paragraphs 3-5 of 

51.166(r) are reserved, and thus do not contain any requirements that must be included in 

Rule 1-220. Paragraphs 6 and 7 of 51.166(r) contain requirements pertaining to NSR reform 

provisions which we have determined are not applicable to Rule 1-220. Please see the TSD 

section entitled New Source Review Reforms for a further discussion of these requirements. 

The submitted rules do not contain any provisions to satisfy the requirements of 40 CFR 

51.166(r)(2), regarding sources obligations which apply if a source becomes a major source 

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

capacity of the source to emit a pollutant. Therefore, we are finding Mendocino’s PSD 

program deficient as to this provision. 
19 

4.3. NEW SOURCE REVIEW REFORMS

California Clean Air Act – New Source Review Program 

The air quality in California has historically been some of the worst in the nation. In light of this 

fact, California has always been at the forefront in implementing strict air quality regulations to 

address the state’s serious air quality problems. 

In 1959, the State passed its first air quality standards for total suspended particulates, 

photochemical oxidants, sulfur dioxide, nitrogen dioxide, and carbon monoxide. These state 

standards were amended in 1969 by the Air Resources Board. At that time, the California 

ambient air quality standard for ozone was lower than the federal standard, thus most of 

California was exceeding the state standard for Ozone. As a result, most California Air Pollution 

control agencies developed permitting programs that contained non-attainment new source 

review requirements such as Lowest Achievable Emissions Rate (LAER) and offsets around the 

same time as the adoption of the federal Clean Air Act in 1970. 

In 1988, California adopted the California Clean Air Act of 1988 (California CAA). This 

legislation established new preconstruction review requirements for new and modified sources. It 

established uniform emission thresholds that trigger control and offset requirements for ozone 

(VOC and NOx), carbon monoxide (CO), sulfur dioxide (SO2) and nitrogen dioxide (NO2) at 

levels significantly lower than the federal thresholds in effect at the time of adoption. These 

thresholds are even lower than the thresholds established two years later by the federal Clean Air 

Act Amendments of 1990 (federal CAA). 

Under both state and federal requirements, all ozone nonattainment areas were classified 

according to the severity of the ozone violations measured for each area. Instead of a single 

major source threshold for all areas, the federal CAA set new major source and major 

modification thresholds of 100 and 40 tpy respectively, for areas classified as moderate or 

marginal; 50 and 25 tpy respectively, for areas classified as serious; 25 and 25 tpy respectively, 

for areas classified as severe; and 10 and 0 tpy respectively, for areas classified as extreme. 

These thresholds are used to determine when a proposed project requires the application of 

LAER and emission offsets. 

In comparison, the California CAA set thresholds for when project emissions trigger the 

application of the California version of Best Available Control Technology (BACT) and offsets. 

(Note that California BACT is defined in such a manner as to be equivalent to federal LAER 

requirements.) The application of California BACT is triggered for emission increases of 25 

lb/day in areas classified as moderate and 10 lbs/day in areas classified as serious, severe or 

extreme. In addition, some California Districts have adopted even lower California BACT 

thresholds of two and zero lb/day. The requirement to provide offsets is triggered for all emission 

increases, once a facility’s emissions exceed 25 tpy in areas classified as moderate; 15 tpy in 

areas classified as serious; and 10 tpy in areas classified as severe or extreme. 

 
20 

California and Federal BACT/LAER and Offset Thresholds for 1-hr Ozone 

CA Ozone Classification 

(ppm)

Marginal Moderate 

(0.09 - 

≤0.12)

Serious 

(0.13 - 

≤0.15)

Severe 

(0.16 - 

≤0.20)

Extreme 

(>0.20)

CA BACT2 (tpy) [lb/day] NA 4.6 [25] 1.8 [10] 1.8 [10] 1.8 [10] 

CA Offset (tpy) NA 25 15 10 10 

EPA Ozone Classification 

(ppm)

Marginal

(0.121 - 

<0.138)

Moderate 

(0.138 - 

≤0.160)

Serious 

(0.160 - 

≤0.180)

Severe 

(0.180 - 

≤0.280)

Extreme 

(>0.28)

Federal Major Source (tpy) 

(Triggers both LAER & Offsets)

100 100 50 25 10 

Federal Major Mods (tpy) 

(Triggers both LAER & Offsets)

40 40 25 25 0 

Note: California design values are lower than federal values for the same classification. 

NSR Reform Program Requirements 

On December 30, 2002, the EPA published a final rulemaking action to provide additional 

flexibility in the permitting of modified sources subject to the federal major source NSR and 

PSD programs. The EPA’s intent was to allow existing sources additional flexibility in the 

NSR/PSD permitting process that would encourage facilities to make process improvements or 

undertake energy efficiency projects that would provide additional environmental benefits by 

reducing emissions on a capacity basis. In 2005, a court vacated two key NSR Reform 

provisions3

, but also upheld the three key remaining provisions. These provisions all pertain to 

how emission increases from proposed modifications of existing sources are calculated. 

One provision allows an existing facility to set a Plantwide Applicability Limit (PAL), which in 

effect is a facility-wide emissions cap for a specific pollutant. Once the PAL is determined, a 

facility can make any physical modification or change in the method of operation, which might 

otherwise trigger a major modification, without obtaining a NSR permit, as long as the plantwide 

emissions remain below the PAL level. For certain types of industries that need significant 

operational flexibility to make quick changes in response to changing market conditions, the 

ability to make changes without having to wait for the issuance of construction permits is worth 

the additional work to ensure emissions from all operations remain below the PAL and maintain 

the additional records needed to verify compliance with the plant-wide emission limits. 

Another provision changed the allowable time frame to be used to determine baseline actual 

emissions. Baseline emissions are generally considered to be the pre-project emissions from the 

facility or emission units proposed to be modified. Prior to implementing the NSR Reforms, the 

EPA required a source to use the actual emissions emitted during the two-year period 

immediately preceding the application date for the new project. Sources were allowed to use a 

different two-year period within the five-year period immediately preceding the application date 

if they could demonstrate that the alternative two-year period was more representative of normal 

operations. The NSR Reforms revised the allowable time frame to be any 24-month period 

 

2

 California Health & Safety Code §§ 40918, 40919, 40920 and 40920.5 

3 State of New York, et al., v. U.S. Environmental Protection Agency, et al., 413 F.3d 3 (D.C. Cir. 2005) 
21 

during the 10-year period immediately preceding the application date. The EPA believes that the 

use of a 10-year period allows a source to look back to a period from a more representative 

business cycle, i.e., 10 years vs. five years, and that significant resources are conserved by 

allowing the source to choose the 24-month period used to establish baseline actual emissions, 

rather than spend time and resources determining what period most represents “normal 

operations.” While going back further in time means a source may be able to choose a period 

with higher average emissions, the NSR Reforms also added requirements to ensure the baseline 

period is adjusted for any excess emissions or any additional emission reductions required by 

new regulations which have become effective since the baseline period. 

The third provision upheld by the court changed how post-project emissions are determined. 

Prior to implementing the NSR Reforms, the EPA required a source to use the worst case 

potential to emit (PTE) assumptions (i.e., operating at 100% capacity, 24 hrs/day, 7 days a 

week), unless the applicant agreed to practically enforceable permit conditions to limit operation 

of the emission unit (i.e. fuel usage limits or limits on hours of operation). In this “actual to 

potential” test, often the difference between the baseline actual emissions and the PTE of an 

operation would be greater than the major modification significance thresholds. As a result, 

many modifications were treated as major modifications, even when the actual emissions would 

decrease, not change, or the actual increase in emissions would not be significant. The NSR 

Reforms changed the post-project emission calculation methodology to allow a source to use the 

highest actual emission rate projected to occur over the next 5 or 10 years and to subtract 

emissions the emission units could have accommodated prior to the project, that were unrelated 

to the project, in order to determine the emission increase from the proposed project. 

It is important to note that none of these revisions changed the major modification significance 

thresholds for triggering control technology and offset requirements. They only changed the 

calculation to determine if the major modification threshold is triggered. 

Impacts of Federal NSR Reforms on California NSR Permitting Programs 

By not adopting the NSR Reforms, the NSR program in California Districts do not include the 

three program elements described earlier: use of PALs, a 10 year look back period for baseline 

actual emissions and projected actual emissions. The use of two of these three provisions 

(baseline actual emissions and projected actual emissions) is required under 40 CFR 

51.165(a)(2). The requirement to adopt a NSR program that allows the use of PALs is found in 

40 CFR 51.165 (f). The NSCAPCD added Section 6.3 to provide sources the option of obtaining 

a PAL. This provision satisfies the requirement to allow the use of PALs. 

Section 116 of the CAA4

 provides that nothing in the Act shall preclude the rights of States to 

 

4

 Section 116 of the CAA: Except as otherwise provided in sections 119 (c), (e), and (f) (as in effect before the date 

of the enactment of the Clean Air Act Amendments of 1977), 209, 211(c)(4), and 233 (preempting certain State 

regulation of moving sources) nothing in this Act shall preclude or deny the right of any State or political 

subdivision thereof to adopt or enforce (1) any standard or limitation respecting emissions of air pollutants or (2) 

any requirement respecting control or abatement of air pollution; except that if an emission standard or limitation is 

in effect under an applicable implementation plan or under section 111 or 112, such State or political subdivision 

may not adopt or enforce any emission standard or limitation which is less stringent than the standard or limitation 

under such plan or section. 
22 

adopt air pollution regulations that are more stringent than those contained in the CAA or 

implementing regulations. As noted above, the California CAA of 1988 adopted lower emission 

thresholds for triggering emission control (BACT/LAER) and offset requirements for new and 

modified sources as part of its NSR program. Consistent with this concept, when the EPA 

adopted new calculation methods to implement the NSR reforms in 40 CFR 51.166 (a)(7),5

 we 

also stated that each plan must use the specific applicability provisions specified unless the State 

specifically demonstrates that the submitted plan provisions “are more stringent than or at least 

as stringent” in all respects as the specified paragraphs. These applicability provisions specify the 

use of baseline actual emissions and projected actual emissions, two of the new NSR Reform 

provisions, but also retain the option for a source to use the actual to potential emission test. 

Several air districts in California have argued that their NSR and PSD permit programs are 

inherently more stringent than the required federal program because the applicability thresholds 

for applying CA BACT and offsets are significantly lower than those in the federal CAA. In 

addition, for modifications, a source does not need to be a major source, as it does for federal 

purposes, before these lower applicability thresholds apply to a proposed project. The districts 

also point out that if a District adopted the NSR Reform calculation methods, and a project using 

these methods was no longer classified as a major modification, it would not be subject to 

Federal LAER and offsets requirements for NSR or Federal BACT for PSD; but the project 

would still have to apply CA BACT and provide offsets in accordance with the CA CAA 

requirements. These lower state emission thresholds are already in almost all Districts’ portion of 

the California SIP, making these requirements enforceable under both state and federal law. 

As a result, CA Districts have argued that the regulatory framework found in other states, where 

adopting the NSR Reforms provide additional permitting flexibility and environmental benefits, 

do not exist in California because adoption of the reform requirements would have no effect on 

the application of control technology or offset requirements. 

The EPA has reviewed the Districts’ claims and considered how the CA CAA provisions affect 

the effectiveness of the NSR Reforms to provide the intended regulatory relief, and we agree that 

the application of CA BACT and offsets at significantly lower thresholds means that the federal 

NSR Reform provisions do not provide any of the EPA’s intended additional flexibility to 

proposed projects that may otherwise trigger federal major modification requirements. If the 

State adopts these provisions, a new project will have to complete two different sets of emission 

calculations; and even if the federal requirements are not applicable, the source will still have to 

comply with the CA BACT control and offset requirements if they are triggered. In light of these 

facts, the EPA is proposing to find that it is acceptable for MCAQMD to not incorporate the 

NSR Reform provisions into their SIP approved NSR and PSD programs, since the same level of 

control will be required for modified sources, with or without inclusion of these provisions in the 

SIP, and their program will not be any less stringent than the federal program. 

 

5 The NSR reforms are also codified for nonattainment programs in 40 CFR 51.165 (a)(2). However, since 

MCAQMD is currently classified attainment or unclassifiable for all NAAQS, the requirement to have a permit 

program that satisfies the requirements of 40 CFR 51.165 is not applicable. 
23 

5. CLEAN AIR ACT SECTIONS 110(l) AND 193

5.1. SECTION 110(l) 

Section 110(l) of the Act prohibits the EPA from approving any revision of a SIP if the revision 

would interfere with any applicable requirement concerning attainment and reasonable further 

progress, or any other applicable requirement of the Act. The SIP approved version of the rules 

being evaluated under this TSD were approved into the SIP on the dates listed in Table 2 above. 

Based on our evaluation of the revisions made to each rule, as discussed below, the rule changes 

are either administrative in nature or do not represent a relaxation of existing requirements which 

may affect attainment or maintenance of the NAAQS. In addition, since the District is currently 

designated as attainment for all the NAAQS, no rule revisions could interfere with reasonable 

further progress. Based on the following analysis, we conclude that full approval of Rules 1-130, 

1-200 and 1-230, and limited approval/disapproval of Rule 1-220 would overall strengthen the 

applicable SIP. 

Rule 1-130 – Definitions

Rule 1-130 contains a list of 63 definitions used to carry out the Districts permit program. It also 

provides a general provision that except for the 63 listed definitions, all definitions included in 

40 CFR 52.21(b), excluding the definition provided in (b)(33) (Replacement Unit) are 

incorporated by reference into Rule 1-130. None of the new or revised definitions relax any 

applicable requirements of the rule. Also, the addition of several new definitions provides 

additional clarity and enforceability to the rules, which strengthen the SIP. 

Rule 1-200 – Permit Requirements

The provisions contained in Rule 1-200 are largely administrative and have no impact on air 

quality. The preliminary determinations listed in Section (c) that the APCO must make prior to 

acting on an application for an ATC only contain minor editorial edits. The list of exempted 

sources contained in Section (d) have been made more stringent by limiting the existing 

exemption for agricultural sources to those with actual emissions which are less than 50% of the 

major source thresholds (paragraph (5)(A)) and the general exemption contained in paragraph 

(8), based on annual emission rates, has been made more stringent by lowering the exemption 

threshold by 50%. 

Rule 1-220 – New Source Review Standards

The provisions contained in Rule 1-220 are mostly administrative in nature. Section (b) is the 

only section that specifies applicability, control requirements, and required analysis and 

determinations. While this section contains several revisions, none of the revised provisions 

make the rule less stringent. Instead the revisions clarify the wording in existing provisions and 

add new requirements such as determining the effect of stack heights on a project. The 

requirements in Section (c) remain unchanged. 

Rule 1-230 – Action on Applications

Rule 1-230 contains only minor revisions which provide additional clarity and a new Section (e) 

which specifies that the issuance of an ATC does not relieve the permit holder of complying with 

all other applicable requirements. This is a strengthening of the rule. 
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5.2. SECTION 193 

Section 193 of the Act, which was added by the Clean Air Act Amendments of 1990, includes a 

savings clause which provides, in pertinent part: “No control requirement in effect, or required to 

be adopted by an order, settlement agreement, or plan in effect before November 15, 1990, in 

any area which is a nonattainment area for any air pollutant may be modified after November 15, 

1990, in any manner unless the modification insures equivalent or greater emission reductions of 

such air pollutant.” 

The MCAQMD is currently classified as attainment or unclassifiable for all NAAQSs, therefore 

the provisions of Section 193 are not applicable to this action. 

6. EPA’S PROPOSED ACTION

Pursuant to section 110(k)(3) of the Act, we recommend full approval of Rules 1-130, 1-200 and 

1-230, and limited approval and limited disapproval of Rule 1-220 Approval of these rules will 

replace the existing SIP rules of the same numbers. We are proposing to approve the submitted 

rules based on our determination that the rules satisfy the applicable statutory and regulatory 

provisions governing regulation of stationary sources under CAA section 110(a)(2)(C), including 

the permitting requirements for major stationary sources in part C of title I of the Act. In support 

of this proposed action, we have concluded that our approval of the submitted rules would 

comply with the requirements of section 110(l) of the Act because the amended rules will not 

interfere with continued attainment of the NAAQS in Mendocino County. We concurrently 

propose a limited disapproval for Rule 220 to correct the deficiencies listed below. If we finalize 

this action as proposed, our action will be codified through revisions to 40 CFR 52.220 

(Identification of Plan). 

In addition, on April 1, 2016 (81 FR 18766), the EPA partially disapproved California’s 

Infrastructure SIP Submittal with respect to Mendocino County AQMD for the 1997 and 2006 

PM2.5 NAAQS because it did not include requirements for a baseline date for PSD increments 

for PM2.5. If we finalize the action proposed in this TSD, this Infrastructure SIP deficiency will 

be remedied, and we will update the approved SIP for California accordingly. 

6.1. RULE DEFICIENCIES

1. The requirements of 40 CFR 51.160(f) and 51.166(l) have not been meet. This deficiency 

may be addressed by adding the appropriate air quality modeling provisions to the rules. 

(See pages 7 and 16) 

2. The requirements of 40 CFR 51.166(r)(2), regarding sources obligations has not been 

meet. This deficiency may be addressed by adding a new provision containing the 

necessary language. (See page 18) 

6.2. RECOMMENDATIONS FOR RULE IMPROVEMENT

1. The ambient air quality standards listed in Rule 160 are significantly out of date. While 

only Rule 130 of the submitted rules refer to Rule 160 as part of the definition of the term 
25 

Episode Alert, it is important to update the ambient air quality standards contained in 

Rule 160 to ensure adequate evaluation of rule requirements. Alternatively, the rules may 

be revised to simply reference State and National Ambient Air Quality Standards, 

without having to include the actual standards in a District rule. 

7. NOTES

Documents cited in TSD are included in the Rulemaking Docket.