MEMORANDUM TO DOCKET

Date: January 2 7 , 2014

Subject: Regulatory Flexibility Act Screening Analysis for Proposed Arizona Regional Haze Federal Implementation Plan (EPA

- R09

- OAR

- 2013

- 0588)

Statutory Requirements 1 :
T he Regulatory Flexibility Act (RFA) imposes both analytical and procedural requirements on EPA and other federal agencies. The analytical requirements call for EPA to carefully consider the economic impacts our rules will have on small entities. The procedural requirements are intended to en sure that small entities have a voice when EPA makes policy determinations in shaping its rules. Together, these requirements ensure that EPA carefully considers the effect our regulations may have on small entities. However, the RFA's analytical and proce dural requirements do not require EPA to reach any particular result regarding small entities.

SBREFA is the Small Business Regulatory Enforcement Fairness Act, a regulatory reform statute passed by the 104 Congress and signed into law by President Clinto n on March 29, 1996. SBREFA (Pub Law No. 104

- 121) enacted a variety of provisions, including several

amendments to the RFA , 5 U.S.C . section 601 , of particular i mportance to EPA rulemakings. The Agency refers to the RFA as amended by SBREFA simply as the R FA

.

For each rule subject to the RFA, EPA must prepare Initial and Final Regulatory Flexibility Analyses, unless we certify that the rule does not have a significant economic impact on a

substantial number of small entities (SISNOSE).

EPA Policy: Even w here the Agency certifies that a rule will not have a SISNOSE, EPA's policy is to make an assessment of the rule's direct adverse impact on any small entities, to engage the potentially regulated entities in a dialog regarding the rule, and to minimize the impact of the rule on small entities to the extent feasible while remaining consistent with applicable statutory requirements.

RFA Screening Analysis: Only rules that are required to undergo notice and comment under

the Administrative Procedure Act (APA), or other applicable statutes, are subject to the requirements of the RFA (5 U.S.C. sections 603

- 604). This rule is subject to the notice

- and

comment requirements of Clean Air Act (CAA) section 307(d) and is therefore subject to the

req uirements of RFA.

The RFA provides separate definitions for what constitutes "small" for three types of entities:

• small businesses

• small governmental jurisdictions, and

• small organizations.

1 See Final Guidance for EPA Rulewriters: Regulatory Flexibility Act as Amended by the Small Business and Regulatory Enforcement Fairness Act, November 2006The RFA incorporates and uses the definition of "small business" found in the Small Business Act (5 U.S.C. section 601(3)). The Small Business Act authorizes the Small Business Administration (SBA) to define "small business" by issuing regulations. The SBA periodically reviews and reissues these definitions. S BA has established size standards for various types of economic activities, or industries, under the North American Industry Classification System (NAICS). These size standards generally define small businesses based on the number of employees or annual re ceipts. The current version of SBA's size standards can be found at http://w ww.sba.gov/size. The SBA definition of a small business applies to a firm's parent company and all affiliates 2 as a single entity.

The RFA defines "small governmental jurisdiction " as the government of a city, county, town, township, village, school district, or special district with a population of less than 50,000 (5 U.S.C. section 601(5)). For the purposes of the RFA, States and tribal governments are not considered small govern ments.

The RFA defines "small organization" as any "not

- for

- profit enterprise which is independently owned and operated and is not dominant in its field" (5 U.S.C. section 601(4)).

There are six facilities that EPA is proposing to regulate in this rule. Each facility and its owner(s) are described below.

Chemical Lime Nelson Plant, Chemical Lime Company (Lhoist Group) Pursuant to 13 CFR 121.201, footnote 1, a firm is small if, it is in NAICS 327410 (lime manufacturing) and the concern and its affiliates have no more than 500 employees. The Nelson Plant, located at Mile #112 off Hwy 66, Peach Springs, Arizona, is affiliated with

Lhoist North America. See http://www.lhoist.us/htm l/Contact_Us/Arizona.htm The Lhoist Group has more than 5,500 employees. See http://www.lhoist.com/en/mission Therefore, Chemical Lime Company and the Lhoist Group are not small entities.

TEP Sundt/Irvington Generating Station

, Tuscon Electric Power Company

Pursuan t to 13 CFR 121.201, footnote 1, f irms primarily engaged in the generation, transmission, and/or distribution of electric energy for sale are small if, including affiliates,

the total electric output for the preceding fiscal year did not exceed 4 million megawatt

hours. I n 2011 Tuscon Electric Power Company ( TEP ) sold 12,804,370 megawatt hours of electricity

. 3 Therefore, TEP is not a small entity.

ASARCO Hayden Smelter, ASARCO ( Grupo México)

Pursuant to 13 C FR 121.201, a firm is small if it is in NAICS 33140 (Nonferrous Metal (except Alum inum) Smelting and Refining) and the concern and its affiliates have no more than 1000 employees. A firm is small if it is in NAICS 212234 (Copper Or e and Nickel Ore Mining) and the concern and its affiliates have no more than 500 employees. Asarco is a

2 Concerns and entities are affiliates of each other when one controls or has the power to control the other, or a third party or parties controls or has the power to control both. It does not matter whether control is exercised, so long as the power to control exists. 13 CFR 121.103(a)(1)

3 TEP 10

- K form for the fiscal year ending December 31, 2011.subsidiary of Americas Mining Corporation whose parent company is Grupo México . As of

201 1

, Grupo México had 26,989 employees. 4 Therefore, Grupo México is not a small entity.

Freeport

- McMoran Miami Smelter, Freeport

- McMoran Copper & Gold Pursuant to 13 CFR 121.201, a firm is small if it is in NAICS 33140 (Nonferrous Metal (except Aluminum) Smelting and Refining) and the concern a nd its affiliates have no more than 1000 employees. A firm is small if it is in NAICS 212234 (Copper Ore and Nickel Ore Mining) and the concern and its affiliates have no more than 500 employees. Freeport

McMoRan Copper & Gold has over 29,700 employees. 5 T herefore, Freeport

- McMoRan is

not a small entity

.

CalPortland Rillito Cement Plant, CalPortland (Taiheyo Cement) Pursuant to 13 CFR 121.201, a firm is small if, it is in NAICS 327310 (cement manufacturing) and the concern and its affiliates have no more than 750 employees. The Rillito Plant, located at 11115 Casa Grande Hwy., Rillito, Arizona, is owned by

CalPortlan d. CalPortland is owned by the Japanese company Taiheiyo Cement. (Source: Hoovers report on CalPortland Company). See map of holdings of Taiheyo Cement, identifying cement plant in Rillito, Arizona. CalPortland Company, its parent the Taiheyo

Cement Co rporation, and affiliates, have more than 750 employees. Therefore CalPortland and Taiheyo are not small entities.

Phoenix Cement Company, Salt River Pima

- Maricopa Indian Community Phoenix Cement Company (PCC) was purchased by the Salt River Pima

- Maricop a Indian Community (SRPMIC) in 1987. See http://www.srmaterials.com/about/tribal

- affiliation.html

. PCC is considered a division of SRPMIC’s government. 6 For the purposes of the RFA, tribal governments are not considered small governments. 5 U.S.C. 601(5). Therefore SRPMIC is not a small entity.

Conclusion: N one of the entities that directly impacted by the proposed rule is a small entity. Therefore, the rule does not have a signifi cant economic impact on a substantial number of small entities and no further analysis is required under the RFA.

4 Grupo Mexico 2011 Annual Report.

5 http://www.fcx.com/company/w ho.htm

6 Letter from Diane Enos, President, SRPMIC, to Jared Blumenfield, Regional Administrator, EPA Region 9 (December 20, 2012).