[Federal Register Volume 65, Number 118 (Monday, June 19, 2000)]
[Proposed Rules]
[Pages 37926-37932]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-15391]


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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Parts 52 and 81

[CA-019-FOI, FRL-6719-2]


Clean Air Act Reclassification and Finding of Failure to 
Implement a State Implementation Plan; California, San Joaquin Valley 
Nonattainment Area; Ozone

AGENCY: Environmental Protection Agency (EPA).

ACTION: Proposed rule.

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SUMMARY: EPA proposes to find that the San Joaquin Valley serious ozone 
nonattainment area did not attain the 1-hour ozone national ambient air 
quality standard by November 15, 1999, the Clean Air Act's (CAA) 
attainment deadline for serious ozone nonattainment areas. If EPA makes 
final this proposed finding, the San Joaquin Valley nonattainment area 
will be reclassified by operation of law to severe.
    EPA also proposes to find that the approved serious area ozone 
State Implementation Plan for the San Joaquin Valley nonattainment area 
has not been fully implemented. If EPA makes final this proposed 
nonimplementation finding, the San Joaquin Valley Unified Air Pollution 
Control District will have to correct the specified deficiencies within 
18 months of the final finding or be subject to sanctions pursuant to 
section 179(b) of the CAA.

DATES: Comments on these proposed actions must be received by July 19, 
2000.

ADDRESSES: Comments may be mailed to: John Ungvarsky, Planning Office 
(AIR-2), Air Division, EPA Region IX, 75 Hawthorne Street, San 
Francisco, CA 94105; <a href="/cdn-cgi/l/email-protection#e6938881908794958d9fc88c898e88a6839687c8818990"><span class="__cf_email__" data-cfemail="bbced5dccddac9c8d0c295d1d4d3d5fbdecbda95dcd4cd">[email protected]</span></a>.
    Copies of the proposed rule, the technical support document for 
this rulemaking, and EPA policies governing nonattainment and 
nonimplementation findings are contained in the docket for this 
rulemaking. The docket is available for inspection during normal 
business hours at the address listed above. A copy of this proposed 
rule and the TSD are also available in the air programs section of EPA 
Region 9's website, http://www.epa.gov/region09.

FOR FURTHER INFORMATION CONTACT: John Ungvarsky, Planning Office (AIR-
2), Air Division, EPA Region IX, 75 Hawthorne Street, San Francisco, CA 
94105, (415) 744-1286.

SUPPLEMENTARY INFORMATION:

[[Page 37927]]

I. The Proposed Finding of Failure To Attain

A. The San Joaquin Valley's Current Status for the 1-Hour Ozone 
Standard

    The San Joaquin Valley ozone nonattainment area includes the 
southern portion of California's central valley and the eastern part of 
Kern County that is located in the Southeast Desert Air Basin. The 
local air pollution control agency for the Valley portion of the 
nonattainment area is the San Joaquin Valley Unified Air Pollution 
Control District (SJVUAPCD) and for eastern Kern, the Kern County Air 
Pollution Control District (KCAPCD). The area is currently classified 
as serious for the 1-hour ozone national ambient air quality standard 
(NAAQS). 40 CFR Sec. 81.305.
    When the Clean Air Act (CAA) Amendments were enacted in 1990, each 
area of the Country that was designated nonattainment for the 1-hour 
ozone standard, including the San Joaquin Valley, was classified by 
operation of law as ``marginal,'' ``moderate,'' ``serious,'' 
``severe,'' or ``extreme'' depending on the severity of the area's air 
quality problem. CAA sections 107(d)(1)(C) and 181(a). Based on its air 
quality during the 1987-1989 period, the San Joaquin Valley 
nonattainment area was initially classified as serious with an 
attainment date of no later than November 15, 1999. See 56 FR 56694 
(November 6, 1991) and CAA section 181(a)(1).

B. Clean Air Act Requirements for Attainment Findings

    Under CAA section 181(b)(2)(A), we must determine within six months 
of the applicable attainment date whether an ozone nonattainment area 
has attained the 1-hour ozone standard. If we find that a serious area 
has not attained the standard and does not qualify for an extension, it 
is reclassified by operation of law to severe.\1\ CAA section 
181(b)(2)(A) requires us to base our determination of attainment or 
failure to attain on the area's design value as of its applicable 
attainment date, which for the San Joaquin Valley nonattainment area is 
November 15, 1999.
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    \1\ If a state does not have the clean data necessary to show 
attainment of the 1-hour standard but does have clean air in the 
year immediately preceding the attainment date and has fully 
implemented its applicable SIP, it may apply to us, under CAA 
section 181(a)(5), for a one-year extension of the attainment date. 
We do not discuss this provision further in today's proposal because 
California did not apply for an extension of the attainment date for 
the San Joaquin Valley nonattainment area, the area did not have the 
requisite clean air data, and, as we propose to find, the State has 
not implemented its applicable SIP.
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    The 1-hour ozone NAAQS is 0.12 ppm not to be exceeded on average 
more than one day per year over any three year period. 40 CFR Sec. 50.9 
and Appendix H. Under our policies, we determine if an area has 
attained the one-hour standard by calculating, at each monitor, the 
average number of days over the standard per year during the preceding 
three year period.\2\ 40 CFR part 50, Appendix H. This means that if an 
area has four or more exceedances at a single monitor during a 3-year 
period, the average number of exceedance days per year exceeds one and 
the area has not attained the standard. For this proposal, we have 
based our determination of whether the San Joaquin Valley nonattainment 
area attained the 1-hour ozone standard by November 15, 1999 on both 
the area's design value and the average number of exceedance days per 
year during the 1997 to 1999 period.
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    \2\ See generally 57 FR 13506 (April 16, 1992) and Memorandum 
from D. Kent Berry, Acting Director, Air Quality Management 
Division, EPA, to Regional Air Office Directors; ``Procedures for 
Processing Bump Ups and Extensions for Marginal Ozone Nonattainment 
Areas,'' February 3, 1994. While explicitly applicable only to 
marginal areas, the general procedures for evaluating attainment in 
this memorandum apply regardless of the initial classification of an 
area because all findings of attainment are made pursuant to the 
same Clean Air Act requirements in section 181(b)(2).
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    The effect of a reclassification to severe on the San Joaquin 
Valley nonattainment area is to set a new attainment deadline for the 
area of November 15, 2005 and to require the State to submit a new 
attainment plan that meets the CAA's requirements for severe ozone 
nonattainment areas. CAA sections 181(a) and 182(i). Under section 
182(i), we may set the submittal deadlines for these new planning 
requirements.

C. The San Joaquin Valley Nonattainment Area Failed to Attain by its 
CAA Deadline

    Table 1 lists each monitoring site in the San Joaquin Valley 
nonattainment area that experienced 4 or more days over the standard in 
the period 1997 to 1999. For each of these monitors, the table lists 
the number of days over the standard, average number of days per year 
over the standard, and the design value during the 1997 to 1999 period. 
For each of these sites, the average number of exceedance days per year 
over the 3-year period 1997-1999 exceeds one. The area's design value, 
which is the highest design value among the area's monitors, is 0.161 
at the Clovis monitor. Because the average number of exceedance days 
per year for 1997-99 exceeds one and the area's design value is above 
the 1-hour ozone standard of 0.12 ppm, we are proposing the find that 
the San Joaquin Valley serious ozone nonattainment area failed to 
attain by its applicable CAA deadline of November 15, 1999.

Table 1.--Ozone Air Quality in the San Joaquin Valley Nonattainment Area
                               (1997-1999)
------------------------------------------------------------------------
                                   Number of      Average
                                   days over     number of
         Monitoring site              the       exceedance   Site design
                                    standard     days per    value (ppm)
                                   1997-1999       year
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Fresno--4706 E. Drummond........           12           4.0        0.137
Fresno--3425 N. First...........           20           6.7        0.146
Fresno--Sierra Skypark#2........           15           5.0        0.141
Parlier.........................           36          12.0        0.145
Clovis..........................           40          13.3        0.161
Edison..........................           27           8.3        0.154
Maricopa (97-98 only)...........            8           4          0.137
Arvin...........................           28           6.3        0.137
Hanford.........................            7           2.3        0.128
Turlock.........................            4           1.3        0.127
Visalia.........................            8           2.7        0.127
Merced..........................            5           1.7        0.132

[[Page 37928]]

 
Edwards \3\.....................            6           2.0        0.139
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D. Failure To Attain Triggers Reclassification to Severe Nonattainment 
and Required Submittal of a Severe Area Plan

    Under  section 181(a)(1) of the Act, the attainment deadline for 
serious ozone nonattainment areas reclassified to severe under section 
181(b)(2) is as expeditiously as practicable but no later than November 
15, 2005. Under section 182(i), such areas are required to submit SIP 
revisions addressing the severe area requirements for the 1-hour ozone 
NAAQS. These requirements are found in CAA section 182(d). Section 
182(i) further provides that we may adjust the CAA deadlines for 
submitting these severe area SIP requirements.
    Pursuant to section 182(i), we intend to require submittal of the 
severe area SIP revisions no later than 18 months from the effective 
date of the area's reclassification. We believe that an 18-month 
schedule is appropriate because of the complexities of developing a 
revised attainment and rate of progress plan for the area and then 
preparing a new, severe area plan. Furthermore, it allows the San 
Joaquin Valley to incorporate into the federally-required severe area 
plan elements of the California Clean Air Act-mandated revisions to its 
state plan that are due in December 2000.\4\
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    \3\ The Edwards monitor is a special purpose monitor (SPM) 
operated by the Air Force on Edwards Air Force Base in eastern Kern 
County. Under applicable Agency policy, we make attainment 
determinations for ozone nonattainment areas using all available, 
quality-assured air quality data including any available quality-
assured data from SPM sites that meet the requirements of 40 CFR 
Sec. 58.13. See Memorandum John Seitz, Director, OAQPS, to Regional 
Air Directors; ``Agency Policy on the Use of Ozone Special Purpose 
Monitoring Data,'' August 22, 1997. We have evaluated the Edwards 
site and its quality assurance information and have determined that 
its data are valid for this attainment determination and therefore 
should be used in making the finding of nonanttainment.
    \4\ Under the California Clean Air Act, air districts must 
submit a progress report and plan revision to the State every three 
years. The deadline for the next triennial update is December 2000. 
(See California Health & Safety Code Sections 40924(b) and 
40925(a).)
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    Under section 182(d), severe area plans are required to meet all 
the requirements for serious area plans plus the requirements for 
severe areas, including, but not limited to: (1) a 25 ton per year 
major stationary source threshold; (2) additional reasonably available 
control technology (RACT) rules for sources subject to the new lower 
major source applicability cutoff; (3) a new source review (NSR) offset 
requirement of at least 1.3 to 1; (4) a rate of progress in emission 
reductions of ozone precursors of at least 3 percent per year from 2000 
until the attainment year; and (5) a fee requirement for major sources 
of volatile organic compounds (VOC) and nitrogen oxides 
(NO<INF>X</INF>) \5\ should the area fail to attain by 2005.\6\ We have 
issued a ``General Preamble for the Implementation of Title I of the 
Clean Air Act Amendments of 1990'' that sets forth our preliminary 
views on these section 182 requirements and how we will act on SIPs 
submitted under Title I. See generally 57 FR 13498 (April 16, 1992) and 
57 FR 18070 (April 28, 1992).
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    \5\ Ozone is not emitted directly into the air, but is formed 
through the photochemical reaction of NO<INF>X</INF> and VOCs.
    \6\ Section 182(d)(3) sets a deadline of December 31, 2000 to 
submit the plan revision requiring fees for major sources should the 
area fail to attain. This date can be adjusted pursuant to CAA 
section 182(i). We propose to adjust this date to coincide with the 
submittal deadline for the rest of the severe area plan 
requirements.
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    The San Joaquin Valley's severe area plan must also contain adopted 
regulations, and/or enforceable commitments to adopt and implement 
control measures in regulatory form by specified dates, sufficient to 
make the required rate of progress and to attain the 1-hour ozone NAAQS 
as expeditiously as practicable but no later than November 15, 2005. It 
is the responsibility of the California Air Resources Board (CARB) and 
the air districts to determine the appropriate mix of measures. 
Nevertheless, for the SJVUAPCD, we strongly suggest that consideration 
be given to including in the revised plan measures for source 
categories where CARB has identified the current San Joaquin Valley 
requirements as not meeting the State's ``all feasible measures'' 
criteria. These source categories are: Restaurants, Chain Driven 
Charbroilers; Stationary IC Engines; Bakery Ovens; Fugitive Emissions 
of VOC from Oil and Gas Production and Processing Facilities; 
Refineries; Chemical Plants and Pipeline Transfer Stations; Refinery 
Boilers (also Small Industrial, Institutional and Commercial Boilers, 
Steam Generators and Process Heaters); Adhesives and Sealants; 
Automotive Refinishing; Pleasure Craft Coating Operations; Stationary 
Gas Turbines; and Polymeric Foam Product Manufacturing.\7\
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    \7\ The CCAA requires that California air districts develop 
attainment plans that achieve a five percent per year reduction in 
each nonattainment pollutant (or its precursors) or that rely on the 
implementation of all feasible measures to reach attainment 
(California Health & Safety Code Section 40914). CARB continually 
evaluates State air plans against the all feasible measures 
criteria. CARB's most recent evaluation of the San Joaquin Valley's 
compliance with the all feasible measures provision of the CCAA was 
released in the October 8, 1999 staff report entitled ``Public 
hearing to Consider Approval of the San Joaquin Valley Unified Air 
Pollution Control District's Triennial Progress Report and Plan 
Revision 1995-1997 Under the California Clean Air Act.''
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    The new attainment demonstration should be based on the best 
information available. Currently, there is a comprehensive ozone study 
being undertaken in the Central Valley, called the Central California 
Ozone Study (CCOS). While we realize that the results from CCOS may not 
be completed in time to develop a new air quality model for use in the 
severe area plan, the State should, to the extent possible, use 
available new data from CCOS to improve the performance of the existing 
model.
    Two of the new severe area SIP requirements, the 25 ton per year 
(tpy) major source cutoff for VOC and NO<INF>X</INF> and the NSR offset 
ratio of 1.3:1, will require revisions to existing SJVUAPCD and KCAQMD 
regulations. We discuss the timeframes for these revisions below.
1. San Joaquin Valley Unified APCD
    We propose that San Joaquin Valley Rule 2201, which implements the 
federal NSR program, must be revised within 180 days of the final date 
of the reclassification to ensure that the District's definitions of 
``Major Source'' and ``Distance Offset Ratio'' reflect the new severe 
area requirements.\8\ We

[[Page 37929]]

propose to set the deadline to complete and submit such rule revisions 
at 180 days because it is consistent with the 6 month time frame we 
gave Sacramento to revise its NSR rule following a reclassification to 
severe \9\ and with the time frame provided for similar changes in the 
Title V operating permits arena (40 CFR part 70.4(i)). See below. If 
SJVUAPCD fails to submit NSR rule revisions that address the new severe 
area requirements within the 180-day deadline, we will start a 
sanctions clock pursuant to CAA section 179(a)(1) for failure to submit 
a required SIP revision.
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    \8\ Section 182(i) of the CAA allows EPA to adjust any 
applicable deadlines ``* * * to the extent such adjustment is 
necessary or appropriate to assure consistency among the required 
submissions.''
    \9\ Letter from David P. Howekamp, Director of the Air & Toxics 
Division, EPA Region IX, to James Boyd, Executive Officer, CARB, 
dated June 8, 1995.
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    San Joaquin Valley Rule 2520, which implements the federal Title V 
operating permits program, must also be revised within 180 days of the 
final date of the reclassification to ensure that the District's 
definition of ``major source'' (and hence, Title V applicability) 
reflects the lower VOC and NO<INF>X</INF> threshold (40 CFR part 
70.4(i)). Since the District's definition of ``Major Source'' in Rule 
2520 references the District's NSR definition of ``New and Modified 
Stationary Source,'' the necessary revision could be accomplished 
simply by modifying NSR Rule 2201. If the required revision is not made 
within 180 days, then the San Joaquin Valley will be subject to the 
sanctions provisions outlined in 40 CFR sections 70.10(a)(1)(i) and 
(ii).
    The lowering of the major source threshold from 50 tpy to 25 tpy 
will make sources previously considered nonmajor to become major, 
thereby subjecting them to Title V. These newly major sources must 
submit Title V permit applications within one year of the date that the 
SJVUAPCD makes the required revision to Rule 2520. The District then 
has 18 months from receipt of a complete application to take final 
action on each permit application (40 CFR part 70.7(a)(2)). We 
recognize that the new lower threshold of 25 tpy is expected to result 
in an almost doubling of Title V sources in the San Joaquin Valley. We 
will work with the District in meeting the 18-month permit issuance 
deadline and will evaluate their progress at that time.
2. Kern County APCD
    We propose that Kern County Rule 210.1, which implements the 
federal NSR program, must be revised within 180 days of the final date 
of the reclassification to ensure that the District's definition of 
``Major Source'' reflects the new severe area requirements. We propose 
to set the deadline to complete and submit such rule revisions at 180 
days because it is consistent with the 6 month time frame we gave 
Sacramento to revise its NSR rule following a reclassification to 
severe and with the time frame provided for similar changes in the 
Title V operating permits arena (40 CFR part 70.4(i)). (See below.) If 
KCAPCD fails to submit NSR rule revisions that address the new severe 
area requirements within the 180-day deadline, we will start a 
sanctions clock pursuant to CAA section 179(a)(1) for failure to submit 
a required SIP revision.\10\
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    \10\ Kern County Rule 210.1 already requires an offset ratio of 
1:1.3, so the District does not have to revise the rule to meet this 
CAA requirement for severe areas.
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    Kern County Rule 201.1, which implements the federal Title V 
operating permits program, must also be revised within 180 days of the 
final date of the reclassification to ensure that the District's 
definition of ``major source'' (and hence, Title V applicability) 
reflects the lower VOC and NO<INF>X</INF> threshold (40 CFR part 
70.4(i)). If the required revision is not made within 180 days, then 
KCAPCD will be subject to the sanctions provisions outlined in 40 CFR 
sections 70.10(a)(1)(i) and (ii).
    The lowering of the major source threshold from 50 tpy to 25 tpy 
will make sources previously considered nonmajor become major, thereby 
subjecting them to Title V. These newly major sources must submit Title 
V permit applications within one year of the date that KCAPCD makes the 
required revision to Rule 210.1. The District then has 18 months from 
receipt of a complete application to take final action on each permit 
application (40 CFR part 70.7(a)(2)). We recognize that the new lower 
threshold of 25 tpy will likely increase the number of Title V sources 
in eastern Kern County. We will work with the District in meeting the 
18-month permit issuance deadline and will evaluate its progress at 
that time.

E. Transportation Conformity Implications of Reclassification

    The ozone reclassification would not immediately affect the 
transportation conformity budgets in the San Joaquin Valley. The 
existing approved VOC and NOx serious attainment budgets limit 
emissions of ozone precursors for the attainment year 1999. Currently, 
since no future year ozone budgets have been developed, these budgets 
apply to all future years. However, once new severe area budgets are 
submitted and have been determined adequate, those severe budgets would 
set emission caps for any milestone years (2002), the new attainment 
year (2005), and all years beyond the attainment year. The serious 
budgets would only apply for the year 1999 and all subsequent years 
until the new milestone or attainment budget dates.
    Establishing new severe budgets in the San Joaquin Valley is 
particularly challenging because there are eight separate 
transportation agencies within the nonattainment boundary. The severe 
area SIP should clearly identify and precisely quantify conformity 
budgets for any milestone years (2002), the attainment year (2005), 
and, if desired, future years. To be adequate, the severe attainment 
demonstration must also contain emissions and air dispersion modeling 
that show motor vehicle emissions at the budget levels will achieve the 
required rate of progress milestones and timely attainment (taking into 
consideration all emission sources and growth). The modeling should be 
done for all years that establish conformity budgets. The data (vehicle 
miles traveled [VMT]) for the modeling and the budgets should be 
established in consultation with appropriate local, state and federal 
agencies to assure that the latest estimates of growth are incorporated 
into the SIP.
    The attainment demonstration may establish emissions budgets for 
subareas within the region only if the modeling in the SIP demonstrates 
that, when all subarea budgets are considered, the area will still 
result in attainment of the standard. Establishment of subarea budgets, 
however, must be fully supported in the SIP documentation since 
development of the subarea budgets would allow individual subareas 
(e.g., counties) to complete separate conformity determinations. In 
addition, the subarea budgets would limit growth of emissions in each 
individual area--there would be no allowance for shifting of growth 
from one subarea to another subarea within the nonattainment area.

II. The Proposed Nonimplementation Finding

A. San Joaquin Valley Serious Area Ozone Nonattainment Plan

    The CAA required California to submit a serious area ozone SIP for 
the San Joaquin Valley that demonstrated a minimum rate of progress 
towards attainment and attainment of the 1-hour ozone NAAQS as 
expeditiously as practicable but no later than November 15, 1999. CAA 
sections 181(a) and 182(c). The deadline for the submittal of this SIP 
was November 15, 1994. CAA section 182(c)(2).

[[Page 37930]]

    On November 15, 1994, the California Air Resources Board (CARB) 
submitted ``The 1994 California State Implementation Plan for Ozone,'' 
a comprehensive ozone plan for the State of California that included a 
local nonattainment plan developed for the San Joaquin Valley by the 
SJVUAPCD (1994 San Joaquin Valley plan).

B. EPA's Approval of the San Joaquin Valley Serious Area Ozone Plan

    In order to be approved, the 1994 San Joaquin Valley plan had to 
meet the requirements for serious ozone nonattainment areas in CAA 
section 182(c). We reviewed the 1994 San Joaquin Valley plan against 
these requirements and approved it as part of the California Ozone SIP 
on January 8, 1997. Among other things, the plan demonstrated that, 
through a combination of State and local control measures, the San 
Joaquin Valley would attain the 1-hour ozone standard by November 15, 
1999. For a detailed discussion of our approval, please refer to the 
proposed and final rulemakings published in the Federal Register on 
March 18, 1996 (61 FR 10920) and January 8, 1997 (62 FR 1150).

C. CAA Requirements for Plan Implementation and NAAQS Attainment

    Following our approval of a nonattainment plan, the plan must be 
implemented to assure that the necessary progress toward and attainment 
of the relevant air quality standard by the applicable deadline. CAA 
section 179(a)(4).
    Under CAA section 179(a)(4), we have the discretionary authority to 
make a finding of nonimplementation if we determine that a state has 
failed to implement any requirement of an approved plan or approved 
part of a plan. If we make a final finding of nonimplementation after 
public notice and comment, the State must correct the failure to 
implement within 18 months or sanctions will be applied to the area 
pursuant to CAA sections 179(a) and (b).

D. Proposed Finding of Failure To Implement the 1994 San Joaquin Valley 
Plan

    In its most basic sense, plan implementation means that the control 
(and other) measures relied on for attainment are being adopted, are in 
effect, and are achieving their specified emissions reductions. Plan 
implementation can also apply to any other requirement in a plan such 
as a requirement for a reasonable further progress demonstration. When 
a requirement in a plan has a future date associated with it, there can 
be no failure to implement that requirement until the date associated 
with it has passed.
    The 1994 San Joaquin Valley plan identifies 20 local stationary and 
area source control measures or control measure revisions and several 
transportation control measures that together were projected to achieve 
a 31.9 ton per day (tpd) reduction in volatile organic compounds (VOCs) 
and a 37.2 tpd reduction in nitrogen oxides (NO<INF>X</INF>).\11\ These 
measures were to be adopted by the SJVUAPCD. We are proposing to find 
that the SJVUAPCD has failed to implement the 1994 San Joaquin Valley 
plan because the deadlines in the plan for adopting and implementing 
six of the 20 measures (see list in Table 2) have passed and the 
measures have not been adopted or implemented. These six measures were 
projected to achieve a total of 8.09 tpd reductions in VOC emissions in 
1999.\11\
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    \11\ See Table 4-1 in ``The Ozone Attainment Demonstration 
Plan,'' SJVAPCD, adopted November 14, 1994.

                    Table 2.--Implementation Deficiencies in the 1994 San Joaquin Valley Plan
----------------------------------------------------------------------------------------------------------------
                                                                    Date when rule was
         Control measure title             Date when rule was         required to be        Projected emissions
                                         required to be adopted        implemented              reductions
----------------------------------------------------------------------------------------------------------------
Rule 4601 Architectural Coatings......  1Q/96..................  1Q/98..................  1.51 tpd VOC.
Rule 4662 Organic Solvent Degreasing..  1Q/96..................  1Q/98..................  2.44 tpd VOC.
Rule 4692 Commercial Charbroiling.....  2Q/96..................  2Q/98..................  0.39 tpd VOC.
Rule 4623 Organic Liquid Storage......  3Q/95..................  3Q/98*.................  3.0 tpd VOC.
Rule 4411 Oil Production Well Cellars.  2Q/96..................  2Q/98..................  0.56 tpd VOC.
Rule 4663 Organic Solvent Waste.......  2Q/96..................  2Q/98..................  0.19 tpd VOC.
----------------------------------------------------------------------------------------------------------------
The SIP indicated that implementation of this Rule could extend beyond 1999.

    If we make final this proposed nonimplementation finding, SJVUAPCD 
must correct the implementation deficiencies in order to stop sanction 
clocks triggered by the finding under CAA section 179(a). In order to 
correct the implementation deficiencies and stop the sanction clocks, 
SJVUAPCD must adopt as rules and implement the measures listed in Table 
2 in a manner that will achieve in total the 8.09 tpd of emissions 
reductions specified in the SIP for them. SJVUAPCD must adopt these 
rules as expeditiously as practicable. Additionally, it must also 
provide for the implementation of the rules as expeditiously as 
practicable but implementation should be no later than November 15, 
2002, the first rate of progress milestone.

E. Sanction Clocks for the Failure To Implement

    Under CAA section 179(a)(4), if we make a finding that a 
requirement of an approved plan is not being implemented, then the 
deficiency identified in the finding must be corrected within 18 months 
or sanctions will be applied. There are two types of sanctions: (1) 
Highway sanctions (CAA section 179(b)(1)) and (2) offset sanctions (CAA 
section 179(b)(2)).
    Under these sanction provisions, if SJVUAPCD has not adopted the 
measures listed in Table 2 with implementation deadlines of on or 
before November 15, 2002 within 18 months of the effective date of a 
final finding, the 2 to 1 offset sanction in CAA section 179(b) will 
apply to that portion of the San Joaquin Valley nonattainment area 
under the jurisdiction of the SJVUAPCD.\12\ This sanction requires a 
company that is constructing a new or modifying an existing facility 
over a certain size to reduce emissions in the area by 2 tons of VOCs 
or NO<INF>x</INF> for every new ton of

[[Page 37931]]

VOC or NOx the new/modified facility will emit.
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    \12\ As noted before, the SJV nonattainment area also includes 
eastern Kern County which is under the separate jurisdiction of the 
Kern County APCD. Because we are proposing no sanctionable findings 
applicable to the area under the jurisdiction of the KCAPCD, any 
sanctions that go into effect in the rest of the SJV nonattainment 
area because of this proposed nonimplementation finding will not 
apply to eastern Kern County. We note that a finding of failure to 
attain pursuant to CAA section 181(b)(1)(A) is not sanctionable 
under the Act.
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    If the SJVUAPCD still has not corrected the deficiencies six months 
after the offset sanction is imposed, then the highway approval and 
funding sanction will apply in the San Joaquin Valley portion of 
nonattainment area. This sanction prohibits the U.S. Department of 
Transportation from approving or funding all but a few specific types 
of transportation projects.
    The order of sanctions, offsets sanctions first then highway 
sanctions, is set in EPA's regulations at 40 CFR 52.31. If sanctions 
have been imposed, they will be lifted when we determine, after an 
opportunity for public comment, that the implementation deficiencies 
have been corrected.

III. Summary of EPA Proposals

    We propose to find that the San Joaquin Valley ozone nonattainment 
area has failed to attain the federal 1-hour ozone standard by its CAA 
deadline of November 15, 1999. If we make final this finding, the San 
Joaquin Valley nonattainment area will be reclassified by operation of 
law to severe and California must submit to EPA, within 18 months of 
the effective date of the finding, a severe area nonattainment plan 
that provides for the attainment of the federal 1-hour ozone standard 
as expeditiously as practicable, but no later than November 15, 2005 
and meets the requirements of CAA section 182(d).
    We also propose to find that the SJVUAPCD has failed to fully 
implement the approved 1994 San Joaquin Valley ozone plan. If we make 
final this finding, in order to avoid CAA sanctions, SJVUAPCD must 
adopt within 18 months the six measures listed in Table 2 of this 
preamble and provide for their implementation as expeditiously as 
practicable but no later than November 15, 2002. These measures must be 
sufficient to achieve an 8.09 tpd reduction in VOC. If sanctions are 
imposed, they will be terminated once we find that all the deficiencies 
have been corrected.

IV. Administrative Requirements

A. Executive Order 12866 (E.O. 12866)

    Under E.O. 12866, (58 FR 51735, October 4, 1993), EPA is required 
to determine whether today's proposal is a ``significant regulatory 
action'' within the meaning of the E.O., and therefore should be 
subject to OMB review, economic analysis, and the requirements of the 
E.O. See E.O. 12866, sec. 6(a)(3). The E.O. defines, in sec. 3(f), a 
``significant regulatory action'' as a regulatory action that is likely 
to result in a rule that may meet at least 1 of 4 criteria identified 
in section 3(f), including, (1) have an annual effect on the economy of 
$100 million or more or adversely affect in a material way the economy, 
a sector of the economy, productivity, competition, jobs, the 
environment, public health or safety, or State, local, or tribal 
governments or communities; (2) create a serious inconsistency or 
otherwise interfere with an action taken or planned by another agency; 
(3) materially alter the budgetary impact of entitlements, grants, user 
fees, or loan programs or the rights and obligations of recipients 
thereof; or (4) raise novel legal or policy issues arising out of legal 
mandates, the President's priorities, or the principles set forth in 
the Executive Order.
    EPA has determined that neither the finding of failure to attain, 
nor the finding of nonimplementation, would result in any of the 
effects identified in E.O. 12866 sec. 3(f). As discussed above, 
findings of failure to attain under section 181(b)(2) of the Act are 
based upon air quality considerations, and reclassifications must occur 
by operation of law in light of certain air quality conditions. These 
findings do not, in and of themselves, impose any new requirements on 
any sectors of the economy. In addition, because the statutory 
requirements are clearly defined with respect to the differently 
classified areas, and because those requirements are automatically 
triggered by classifications that, in turn, are triggered by air 
quality values, findings of failure to attain and reclassification 
cannot be said to impose a materially adverse impact on State, local, 
or tribal governments or communities. Similarly, the finding of failure 
to implement the SIP merely ensures the implementation of already 
existing requirements by creating the potential for the imposition of 
sanctions and therefore does not adversely affect entities.

B. Executive Order 13132

    Executive Order 13132, ``Federalism,'' (64 FR 43255, August 10, 
1999) revokes and replaces Executive Orders 12612, ``Federalism,'' and 
12875, ``Enhancing the Intergovernmental Partnership.'' Executive Order 
13132 requires EPA to develop an accountable process to ensure 
``meaningful and timely input by State and local officials in the 
development of regulatory policies that have federalism implications.'' 
``Policies that have federalism implications'' is defined in the 
Executive Order to include regulations that have ``substantial direct 
effects on the States, on the relationship between the national 
government and the States, or on the distribution of power and 
responsibilities among the various levels of government.'' Under 
Executive Order 13132, EPA may not issue a regulation that has 
federalism implications, that imposes substantial direct compliance 
costs, and that is not required by statute, unless the Federal 
government provides the funds necessary to pay the direct compliance 
costs incurred by State and local governments, or EPA consults with 
State and local officials early in the process of developing the 
proposed regulation. EPA also may not issue a regulation that has 
federalism implications and that preempts State law unless the Agency 
consults with State and local officials early in the process of 
developing the proposed regulation.
    These proposed findings will not have substantial direct effects on 
California, on the relationship between the national government and 
California, or on the distribution of power and responsibilities among 
the various levels of government, as specified in Executive Order 
13132.
    EPA is proposing two actions: a finding that the San Joaquin Valley 
ozone nonattainment area has failed to attain the ozone NAAQS by the 
statutory deadline and a finding that the San Joaquin Valley ozone 
plan, adopted by the State and approved by EPA, has not been fully 
implemented. Findings of failure to attain under section 181(b)(2) of 
the Act are based upon air quality considerations, and 
reclassifications must occur by operation of law in light of certain 
air quality conditions. These findings do not, in and of themselves, 
impose any new requirements. In addition, because the statutory 
requirements are clearly defined with respect to the differently 
classified areas, and because those requirements are automatically 
triggered by classifications that, in turn, are triggered by air 
quality values, findings of failure to attain and reclassification 
cannot be said to impose a materially adverse impact on State, local, 
or tribal governments or communities. A finding of nonimplementation 
has no direct effects on the State; there is simply a potential for the 
imposition of sanctions if the State does not adopt the rules to which 
it has committed under its own State plan. Thus, the requirements of 
section 6 of the Executive Order do not apply to this rule.

C. Executive Order 13045

    Protection of Children from Environmental Health Risks and Safety 
Risks (62 FR 19885, April 23, 1997),

[[Page 37932]]

applies to any rule that: (1) Is determined to be ``economically 
significant'' as defined under E.O. 12866, and (2) concerns an 
environmental health or safety risk that EPA has reason to believe may 
have a disproportionate effect on children. If the regulatory action 
meets both criteria, the Agency must evaluate the environmental health 
or safety effects of the planned rule on children, and explain why the 
planned regulation is preferable to other potentially effective and 
reasonably feasible alternatives considered by the Agency. These 
proposed findings are not subject to E.O. 13045 because they do not 
involve decisions intended to mitigate environmental health or safety 
risks.

D. Executive Order 13084

    Under Executive Order 13084, Consultation and Coordination with 
Indian Tribal Governments, EPA may not issue a regulation that is not 
required by statute, that significantly or uniquely affects the 
communities of Indian tribal governments, and that imposes substantial 
direct compliance costs on those communities, unless the Federal 
government provides the funds necessary to pay the direct compliance 
costs incurred by the tribal governments, or EPA consults with those 
governments. If EPA complies by consulting, Executive Order 13084 
requires EPA to provide to the Office of Management and Budget, in a 
separately identified section of the preamble to the rule, a 
description of the extent of EPA's prior consultation with 
representatives of affected tribal governments, a summary of the nature 
of their concerns, and a statement supporting the need to issue the 
regulation. In addition, Executive Order 13084 requires EPA to develop 
an effective process permitting elected officials and other 
representatives of Indian tribal governments ``to provide meaningful 
and timely input in the development of regulatory policies on matters 
that significantly or uniquely affect their communities.'' Today's 
proposed findings do not significantly or uniquely affect the 
communities of Indian tribal governments. Accordingly, the requirements 
of section 3(b) of E.O. 13084 do not apply to this rulemaking.

E. Regulatory Flexibility Act

    The Regulatory Flexibility Act (RFA) generally requires an agency 
to conduct a regulatory flexibility analysis of any rule subject to 
notice and comment rulemaking requirements unless the agency certifies 
that the rule will not have a significant economic impact on a 
substantial number of small entities. Small entities include small 
businesses, small not-for-profit enterprises, and small governmental 
jurisdictions. These proposed findings will not have a significant 
impact on a substantial number of small entities for the reasons set 
forth in section VI.B. above. Therefore, because these proposed 
findings do not create any new requirements, I certify that they will 
not have a significant economic impact on a substantial number of small 
entities. Moreover, due to the nature of the Federal-State relationship 
under the Clean Air Act, preparation of flexibility analysis would 
constitute Federal inquiry into the economic reasonableness of state 
action. The Clean Air Act forbids EPA to base its actions concerning 
SIPs on such grounds. Union Electric Co., v. U.S. EPA, 427 U.S. 246, 
255-66 (1976); 42 U.S.C. 7410(a)(2).

F. Unfunded Mandates

    Under Section 202 of the Unfunded Mandates Reform Act of 1995 
(``Unfunded Mandates Act''), signed into law on March 22, 1995, EPA 
must prepare a budgetary impact statement to accompany any proposed or 
final rule that includes a Federal mandate that may result in estimated 
annual costs to State, local, or tribal governments in the aggregate; 
or to private sector, of $100 million or more. Under Section 205, EPA 
must select the most cost-effective and least burdensome alternative 
that achieves the objectives of the rule and is consistent with 
statutory requirements. Section 203 requires EPA to establish a plan 
for informing and advising any small governments that may be 
significantly or uniquely impacted by the rule.
    EPA has determined that the proposed findings do not include a 
Federal mandate that may result in estimated annual costs of $100 
million or more to either State, local, or tribal governments in the 
aggregate, or to the private sector for the reasons set forth in 
section IV.B. above. Accordingly, no additional costs to State, local, 
or tribal governments, or to the private sector, result from these 
actions.

List of Subjects

40 CFR Part 52

    Environmental protection, Air pollution control, Hydrocarbons, 
Intergovernmental relations, Nitrogen oxides, Ozone, Volatile organic 
compounds.

40 CFR Part 81

    Environmental protection, Air pollution control, National parks, 
Wilderness areas.

    Authority: 42 U.S.C. 7401 et seq.

    Dated: June 7, 2000.
Felicia Marcus,
Regional Administrator, Region IX.
[FR Doc. 00-15391 Filed 6-16-00; 8:45 am]
BILLING CODE 6560-50-P


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