[Federal Register Volume 71, Number 161 (Monday, August 21, 2006)]
[Proposed Rules]
[Pages 48696-48750]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 06-6926]



[[Page 48695]]

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Part V





Environmental Protection Agency





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40 CFR Parts 49 and 51



 Review of New Sources and Modifications in Indian Country; Proposed 
Rule

Federal Register / Vol. 71, No. 161 / Monday, August 21, 2006 / 
Proposed Rules

[[Page 48696]]


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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Parts 49 and 51

[EPA-HQ-OAR-2003-0076; FRL-8210-4]
RIN 2060-AH37


Review of New Sources and Modifications in Indian Country

AGENCY: Environmental Protection Agency (EPA).

ACTION: Proposed rule.

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SUMMARY: The Environmental Protection Agency (EPA) proposes to 
promulgate a Federal Implementation Plan (FIP) under the Clean Air Act 
(the Act) for tribes in Indian country. The FIP would include two basic 
air quality regulations for the protection of communities in Indian 
country. The first rule would apply to minor stationary sources and 
minor modifications at major stationary sources in Indian country 
(minor NSR rule). The second rule would apply to all new major 
stationary sources and major modifications located in areas of Indian 
country that are designated as not attaining the National Ambient Air 
Quality Standards (NAAQS) (nonattainment major NSR rule). These rules 
would be implemented by EPA, or a delegate tribal agency assisting EPA 
with administration of the rules, until replaced by an EPA-approved 
tribal implementation plan for an area of Indian country.

DATES: Comments. Comments must be received on or before November 20, 
2006. Under the Paperwork Reduction Act, comments on the information 
collection provisions must be received by OMB on or before September 
20, 2006.
    Public Hearing. If anyone contacts us requesting to speak at a 
public hearing by September 11, 2006, we will hold a public hearing. 
Additional information about the hearing would be published in a 
subsequent Federal Register notice.

ADDRESSES: Submit your comments, identified by Docket ID No. EPA-HQ-
OAR-2003-0076, by one of the following methods:
    <bullet> http://www.regulations.gov. Follow the on-line 
instructions for submitting comments.
    <bullet> E-mail: <a href="/cdn-cgi/l/email-protection#91f0bcf0fff5bce3bcf5fef2faf4e5d1f4e1f0fcf0f8fdbff4e1f0bff6fee7"><span class="__cf_email__" data-cfemail="3e5f135f505a134c135a515d555b4a7e5b4e5f535f5752105b4e5f10595148">[email protected]</span></a>.
    <bullet> Fax: 202-566-1741.
    <bullet> Mail: Attention Docket ID No. EPA-HQ-OAR-2003-0076, U.S. 
Environmental Protection Agency, EPA West (Air Docket), 1200 
Pennsylvania Avenue, Northwest, Mailcode: 6102T, Washington, DC 20460. 
Please include a total of 2 copies. In addition, please mail a copy of 
your comments on the information collection provisions to the Office of 
Information and Regulatory Affairs, Office of Management and Budget 
(OMB), Attn: Desk Officer for EPA, 725 17th St., NW., Washington, DC 
20503.
    <bullet> Hand Delivery: U.S. Environmental Protection Agency, EPA 
West (Air Docket), 1301 Constitution Avenue, Northwest, Room B-102, 
Washington, DC 20004, Attention Docket ID No. EPA-HQ-OAR-2003-0076. 
Such deliveries are only accepted during the Docket's normal hours of 
operation, and special arrangements should be made for deliveries of 
boxed information.
    Instructions. Direct your comments to Docket ID No. EPA-HQ-OAR-
2003-0076. EPA's policy is that all comments received will be included 
in the public docket without change and may be made available online at 
http://www.regulations.gov, including any personal information 
provided, unless the comment includes information claimed to be 
Confidential Business Information (CBI) or other information whose 
disclosure is restricted by statute. Do not submit information that you 
consider to be CBI or otherwise protected through http://www.regulations.gov or e-mail. The http://www.regulations.gov Web site 
is an ``anonymous access'' system, which means EPA will not know your 
identity or contact information unless you provide it in the body of 
your comment. If you send an e-mail comment directly to EPA without 
going through http://www.regulations.gov your e-mail address will be 
automatically captured and included as part of the comment that is 
placed in the public docket and made available on the Internet. If you 
submit an electronic comment, EPA recommends that you include your name 
and other contact information in the body of your comment and with any 
disk or CD-ROM you submit. If EPA cannot read your comment due to 
technical difficulties and cannot contact you for clarification, EPA 
may not be able to consider your comment. Electronic files should avoid 
the use of special characters, any form of encryption, and be free of 
any defects or viruses. For additional instructions on submitting 
comments, go to I C & D of the SUPPLEMENTARY INFORMATION section of 
this document.
    Docket: All documents in the docket are listed in the http://www.regulations.gov index. Although listed in the index, some 
information is not publicly available, e.g., CBI or other information 
whose disclosure is restricted by statute. Certain other material, such 
as copyrighted material, will be publicly available only in hard copy. 
Publicly available docket materials are available either electronically 
in http://www.regulations.gov or in hard copy at the U.S. Environmental 
Protection Agency, Air Docket, EPA/DC, EPA West, Room B102, 1301 
Constitution Ave., NW., Washington, DC. The Public Reading Room is open 
from 8:30 a.m. to 4:30 p.m., Monday through Friday, excluding legal 
holidays. The telephone number for the Public Reading Room is (202) 
566-1744, and the telephone number for the Air Docket is (202) 566-
1742.

FOR FURTHER INFORMATION CONTACT: For technical information, contact Raj 
Rao, Air Quality Policy Division, U.S. EPA, Office of Air Quality 
Planning and Standards (C504-03), Research Triangle Park, North 
Carolina 27711, telephone number (919) 541-5344, facsimile number (919) 
541-5509, electronic mail e-mail address: <a href="/cdn-cgi/l/email-protection#7c0e1d13520e1d163c190c1d521b130a"><span class="__cf_email__" data-cfemail="6a180b0544180b002a0f1a0b440d051c">[email protected]</span></a>. To request a 
public hearing or information pertaining to a public hearing on this 
document, contact Ms. Pamela S. Long, Air Quality Policy Division, U.S. 
EPA, Office of Air Quality Planning and Standards (C504-03), Research 
Triangle Park, North Carolina 27711, telephone number (919) 541-0641, 
facsimile number (919) 541-5509, electronic mail e-mail address: 
<a href="/cdn-cgi/l/email-protection#64080b0a034a140509240114054a030b12"><span class="__cf_email__" data-cfemail="2d4142434a035d4c406d485d4c034a425b">[email protected]</span></a>.

SUPPLEMENTARY INFORMATION:

I. General Information

A. Does This Action Apply to Me?

    Entities potentially affected by this proposed action include 
owners and operators of emission sources in all industry groups located 
in Indian country, EPA, and tribal governments that are delegated 
administrative authority to assist EPA with the implementation of these 
Federal regulations. Categories and entities potentially affected by 
this action are expected to include:

[[Page 48697]]



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             Category                NAICS a                     Examples of regulated entities
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Industry..........................       4471  Gasoline station storage tanks and refueling.
                                         5614  Lumber manufacturer support.
                                        21211  Coal mining.
                                        31332  Surface coating operation.
                                        33712  Furniture manufacture.
                                        56221  Medical waste incinerator.
                                       115112  Repellent and fertilizer applications.
                                       211111  Natural gas plant.
                                       211111  Oil and gas production.
                                       211112  Fractionation of natural gas liquids.
                                       212234  Copper mining and processing.
                                       212312  Stone quarrying and processing.
                                       212313  Stone quarrying and processing.
                                       212321  Sand and gravel production.
                                       221112  Power plant-coal-fired.
                                       221119  Power plant-biomass fueled.
                                       221119  Power plant-landfill gas fired.
                                       221210  Natural gas collection.
                                       221210  Natural gas pipeline.
                                       321113  Sawmill.
                                       321911  Window and door molding manufacturer.
                                       323110  Printing operations.
                                       323113  Surface coating operations.
                                       324121  Asphalt hot mix plants.
                                       325188  Elemental phosphorus plant.
                                       325188  Sulfuric acid plant.
                                       331314  Secondary aluminum production and extrusion.
                                       331492  Cobalt and tungsten recycling.
                                       332431  Surface coating operations.
                                       332812  Surface coating operations.
                                       421320  Concrete batching plant.
                                       422510  Grain elevator.
                                       422710  Crude oil storage and distribution.
                                       422710  Gasoline bulk plant.
                                       486110  Crude oil storage and distribution.
                                       486210  Natural gas compressor station.
                                       562212  Solid waste landfill.
                                       811121  Automobile refinishing shop.
                                       812320  Dry cleaner.
Federal government................     924110  Administration of Air and Water Resources and Solid Waste
                                                Management Programs.
State/local/tribal government.....     924110  Administration of Air and Water Resources and Solid Waste
                                                Management Programs.
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a North American Industry Classification System.

    This table is not intended to be exhaustive, but rather provides a 
guide for readers regarding entities likely to be regulated by this 
action. To determine whether your facility is regulated by this action, 
you should examine the applicability criteria in the proposed minor and 
major NSR programs for Indian country, proposed 40 CFR 49.153 and 
49.168, respectively. If you have any questions regarding the 
applicability of this action to a particular entity, contact the person 
listed in the preceding FOR FURTHER INFORMATION CONTACT section.

B. What Should I Consider as I Prepare My Comments for EPA?

    1. Submitting CBI. Do not submit this information to EPA through 
http://www.regulations.gov or e-mail. Clearly mark the part or all of 
the information that you claim to be CBI. For CBI information in a disk 
or CD ROM that you mail to EPA, mark the outside of the disk or CD ROM 
as CBI and then identify electronically within the disk or CD ROM the 
specific information that is claimed as CBI. In addition to one 
complete version of the comment that includes information claimed as 
CBI, a copy of the comment that does not contain the information 
claimed as CBI must be submitted for inclusion in the public docket. 
Information so marked will not be disclosed except in accordance with 
procedures set forth in 40 CFR part 2. Send or deliver information 
identified as CBI only to the following address: Roberto Morales, OAQPS 
Document Control Officer (C404-02), U.S. EPA, Research Triangle Park, 
NC 27711, Attention Docket ID No. EPA-HQ-OAR-2003-0076.
    2. Tips for Preparing Your Comments. When submitting comments, 
remember to:
    <bullet> Identify the rulemaking by docket number and other 
identifying information (subject heading, Federal Register date and 
page number).
    <bullet> Follow directions--The agency may ask you to respond to 
specific questions or organize comments by referencing a Code of 
Federal Regulations (CFR) part or section number.
    <bullet> Explain why you agree or disagree; suggest alternatives 
and substitute language for your requested changes.
    <bullet> Describe any assumptions and provide any technical 
information and/or data that you used.
    <bullet> If you estimate potential costs or burdens, explain how 
you arrived at your estimate in sufficient detail to allow for it to be 
reproduced.
    <bullet> Provide specific examples to illustrate your concerns, and 
suggest alternatives.

[[Page 48698]]

    <bullet> Explain your views as clearly as possible, avoiding the 
use of profanity or personal threats.
    <bullet> Make sure to submit your comments by the comment period 
deadline identified.

C. Where Can I get a Copy of This Document and Other Related 
Information?

    In addition to being available in the docket, an electronic copy of 
this proposal will also be available on the WWW. Following signature by 
the EPA Administrator, a copy of this notice will be posted in the 
regulations and standards section of our NSR home page located at 
http://www.epa.gov/nsr and on the tribal air home page at http://www.epa.gov/oar/tribal.

D. How Can I Find Information About a Possible Hearing?

    Persons interested in presenting oral testimony should contact Ms. 
Pamela Long, New Source Review Group, Air Quality Policy Division 
(C504-03), U.S. EPA, Research Triangle Park, NC 27711, telephone number 
(919) 541-0641 or e-mail <a href="/cdn-cgi/l/email-protection#81edeeefe6aff1e0ecc1e4f1e0afe6eef7"><span class="__cf_email__" data-cfemail="7e12111019500e1f133e1b0e1f50191108">[email protected]</span></a> at least 2 days in advance of 
the public hearing. Persons interested in attending the public hearing 
should also contact Ms. Long to verify the time, date, and location of 
the hearing. The public hearing will provide interested parties the 
opportunity to present data, views, or arguments concerning these 
proposed rules.

E. Overview of Rule

    In this rulemaking, we \1\ are proposing to fill a regulatory gap 
that currently exists in Indian country. We are proposing two new 
source review (NSR) rules under which the reviewing authority will 
issue pre-construction permits for certain stationary sources of air 
pollution in Indian country. These proposed rules would provide 
additional regulatory tools for us to use in implementing the Act in 
Indian country. The minor NSR rule would apply to new and modified 
minor sources and to minor modifications at major stationary sources. 
Sources subject to this rule would apply control technology, if any, as 
determined by the reviewing authority on a case-by-case basis. In rare 
instances at the discretion of the reviewing authority, such sources 
may also be required to submit an air quality analysis as part of their 
permit application. We are proposing to establish minor NSR thresholds 
so that only minor sources with a potential to emit (PTE) equal to or 
higher than these thresholds would be subject to this rule. 
Additionally, this rule would allow otherwise major stationary sources 
in Indian country to voluntarily accept emission limitations on their 
PTE to become ``synthetic minor sources.'' Such synthetic minor sources 
would include sources that emit hazardous air pollutants (HAP). In such 
a case, they would not be subject to major source MACT regulations 
under 40 CFR part 63. Any limitations on PTE must be enforceable as a 
practical matter (that is, legally and practically enforceable).
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    \1\ In this proposal, the term ``we'' refers to the EPA and the 
term ``you'' refers to stationary sources of air pollution and their 
owners and operators.
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    Under the nonattainment major NSR rule, affected sources would be 
required to comply with the provisions of 40 CFR part 51, appendix S, a 
transitional rule which generally applies to areas that do not have a 
State Implementation Plan (SIP). Sources subject to this rule would be 
subject to requirements for Lowest Achievable Emission Rate (LAER) 
control technology, emissions offsets, compliance certification, and 
net air quality benefit analysis. Due to the limited number of sources 
in Indian country, offsets are not generally available. We have 
proposed options for addressing the lack of availability of offsets in 
Indian country.
    The information presented in this preamble is organized as follows:

I. General Information
    A. Does This Action Apply to Me?
    B. What Should I Consider as I Prepare My Comments for EPA?
    C. Where Can I get a Copy of This Document and Other Related 
Information?
    D. How Can I Find Information About a Possible Hearing?
    E. Overview of Rule.
II. Purpose
III. Background
    A. The New Source Review (NSR) Program
    1. What are the general requirements of the major NSR program?
    2. What are the general requirements of the minor NSR program?
    B. Status of Air Quality Programs in Indian Country
    C. Consultation With Tribal Representatives
IV. Proposed Rules for Indian Country
    A. Minor NSR Program
    1. What is a minor source and which minor sources are subject to 
this rule?
    2. What is a modification and what modifications are subject to 
this rule?
    3. What are the minor NSR thresholds and how did we develop 
them?
    4. Are any emissions units and activities at stationary sources 
exempt from this rule?
    5. What are the permit application, control technology, and air 
quality analysis requirements, and what is the permit issuance 
process?
    6. When are modifications subject to this rule?
    7. Why do we believe that an allowable-to-allowable test is 
appropriate for minor sources?
    8. Is your existing minor source subject to this rule?
    9. How are ``synthetic minor sources'' subject to this rule?
    10. How would section 112(g) case-by-case MACT determinations be 
addressed by this rule?
    11. What are the proposed requirements for public participation 
in the permitting process?
    12. What are the monitoring, recordkeeping, and reporting 
requirements?
    13. What are the criteria for general permits, what source 
categories generally qualify for them, and what are the permit 
application requirements for a general permit?
    14. What is the administrative and judicial review process 
proposed for this program?
    B. Major NSR Program in Nonattainment Areas of Indian Country
    1. What are the requirements for major source permitting under 
appendix S?
    2. What are the options we are proposing to address the lack of 
available offsets in Indian country?
    3. What are the proposed public participation requirements for 
this program?
    4. How do I meet the statewide compliance certification 
requirement of the Act?
V. Legal Basis, Statutory Authority, and Jurisdictional Issues
    A. What is the basis for our authority to implement these 
programs?
    B. How does a tribe receive delegation to assist EPA with 
administration of the Federal minor and major NSR rules?
    C. What happens to permits previously issued by States to 
sources in Indian country?
VI. Statutory and Executive Order Reviews
    A. Executive Order 12866: Regulatory Planning and Review
    B. Paperwork Reduction Act
    C. Regulatory Flexibility Act (RFA)
    D. Unfunded Mandates Reform Act
    E. Executive Order 13132: Federalism
    F. Executive Order 13175: Consultation and Coordination With 
Indian Tribal Governments
    G. Executive Order 13045: Protection of Children From 
Environmental Health & Safety Risks
    H. Executive Order 13211: Actions That Significantly Affect 
Energy Supply, Distribution, or Use
    I. Executive Order 12898: Federal Actions To Address 
Environmental Justice in Minority Populations and Low-Income 
Populations
    J. National Technology Transfer Advancement Act
VII. Statutory Authority

II. Purpose

    The purpose of today's rulemaking is to ensure that air resources 
in Indian country will be protected in the manner intended by the Act 
as amended in 1990 by establishing a permitting program for

[[Page 48699]]

stationary sources in Indian country. Currently in Indian country, 
there is no permitting mechanism for new or modified minor sources; 
minor modifications at major sources; or new major stationary sources 
or major modifications of regulated NSR pollutants in nonattainment 
areas. In addition, there is no minor source permitting mechanism for 
major stationary sources looking to voluntarily limit emissions to 
become synthetic minor sources \2\ or for approving case-by-case 
maximum achievable control technology (MACT) determinations. Today's 
proposed rules will fill this regulatory gap and provide regulatory 
certainty to allow for environmentally sound economic growth in Indian 
country. By establishing this FIP for Indian country, we will provide 
more consistency with the requirements and programs of the States and 
thus create a more level regulatory playing field for owners and 
operators within and outside of Indian country. We are proposing these 
permit programs pursuant to section 110(a)(2)(C), part D of title I, 
and section 301(d) of the Act.
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    \2\ Sources located within the exterior boundaries of Indian 
reservations in Idaho, Oregon, and Washington can apply for a non-
Title V operating permit to establish synthetic minor status under 
the FIP established for those reservations. See 40 CFR 49.139 and 40 
CFR part 49, subpart M.
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III. Background

A. The New Source Review (NSR) Program

1. What are the general requirements of the major NSR program?
    The major NSR program contained in parts C and D of title I of the 
Act is a preconstruction review and permitting program applicable to 
new major stationary sources and major modifications at such sources. 
In areas not meeting health-based NAAQS and in ozone transport regions 
(OTR), the program is implemented under the requirements of part D of 
title I of the Act. We call this program the ``nonattainment'' major 
NSR program. In areas meeting the NAAQS (``attainment'' areas) or for 
which there is insufficient information to determine whether they meet 
the NAAQS (``unclassifiable'' areas), the NSR requirements under part C 
of title I of the Act apply. We call this program the Prevention of 
Significant Deterioration (PSD) program. Collectively, we also commonly 
refer to these programs as the major NSR program. These rules are 
contained in 40 CFR 51.165, 51.166, 52.21, 52.24, and part 51, 
appendices S and W.
    For newly constructed, ``greenfield'' sources, the determination of 
whether a source is subject to the major NSR program is based on the 
source's PTE. The Act, as implemented by our rules, sets applicability 
thresholds for major sources in nonattainment areas. These thresholds 
are 100 tons per year (tpy) of any pollutant subject to regulation 
under the Act, or smaller amounts, depending on the nonattainment 
classification. For attainment areas the thresholds are 100 or 250 tpy, 
depending on the source type. A new source with a PTE at or above the 
applicable threshold amount ``triggers,'' or is subject to, major NSR.
    For existing major sources, major NSR applies to a ``major 
modification.'' For a modification to be major, the following three 
criteria have to be met:
    (1) A physical change in or change in the method of operation of a 
major stationary source must occur;
    (2) The increase in emissions resulting from this change must be 
significant (equal to or above the significance levels defined in 40 
CFR 52.21(b)(23)); and
    (3) The increase in emissions resulting from the change must be a 
significant net emissions increase. In other words, when the increase 
from the project is added to other contemporaneous increases or 
decreases in actual emissions \3\ at the source, the net emissions 
increase must be significant (equal to or above the significance levels 
defined in 40 CFR 52.21(b)(23)).
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    \3\ In approximate terms, ``contemporaneous'' emissions 
increases or decreases are those that have occurred between the date 
5 years immediately preceding the proposed physical or operational 
change and the date that the increase from the change occurs. See, 
for example, 40 CFR 52.21(b)(3)(ii).
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    Major sources and major modifications subject to nonattainment 
major NSR must apply state-of-the-art emissions control technologies, 
including any pollution prevention measures, to achieve the LAER. The 
LAER is based on the most stringent emission limitation in the 
implementation plan of any State, or achieved in practice, for the 
source category under review.
    Each major source subject to nonattainment major NSR must also 
``offset'' its emissions increase by obtaining emissions reductions 
from other sources in the area, or in an area of equal or higher 
nonattainment classification that contributes to nonattainment in the 
subject source's area. The ratio of the offset relative to the proposed 
increase must be at least one-to-one and is based on the severity of 
the area's nonattainment classification. For ozone and particulate 
matter less than 10 microns in aerodynamic diameter (PM-10), the more 
polluted the air is where the source is locating or expanding, the 
greater is the required offset ratio. The emissions reductions to be 
used as offsets must be surplus (not otherwise required by the Act), 
quantifiable, federally enforceable, and permanent. See sections 173(a) 
and (c) of the Act and 40 CFR 51.165(a)(3).
    Additionally, each major nonattainment NSR permit applicant must 
also conduct an analysis of ``alternative sites, sizes, production 
processes, and environmental control techniques demonstrating that the 
benefits of the proposed emissions source significantly outweigh the 
environmental and social costs of its location, construction, or 
modification.'' Moreover, each major nonattainment NSR permit applicant 
must demonstrate that all other major stationary sources under her/his 
control in the same State are in compliance or on a schedule of 
compliance with all emission limitations and standards of the Act.
    Under the PSD program for attainment areas, a major source or 
modification must apply Best Available Control Technology (BACT), which 
may be based on pollution prevention techniques. In addition, the 
source must analyze the impact of the project on ambient air quality to 
assure that no violation of the NAAQS or PSD increments will result, 
and must analyze impacts on soil, vegetation, and visibility. Sources 
or modifications that would impact Class I areas (e.g., national parks) 
may be subject to additional requirements to protect air quality 
related values (AQRVs) that have been identified for such areas.
2. What are the general requirements of the minor NSR program?
    Section 110(a)(2)(C) of the Act requires that every SIP include a 
program to regulate the construction and modification of stationary 
sources, including a permit program as required by parts C and D of 
title I of the Act, to ensure attainment and maintenance of NAAQS. 
Parts C and D address the major NSR program for major stationary 
sources, and the permitting program for minor stationary sources is 
addressed by section 110(a)(2)(C) of the Act. We commonly refer to the 
latter program as the ``minor NSR'' program. A minor stationary source 
means a source whose PTE is lower than the major source applicability 
threshold for a particular pollutant as defined in the applicable 
nonattainment major NSR program or PSD program.

[[Page 48700]]

    The Federal requirements for minor source programs are outlined 40 
CFR 51.160 through 51.164. States must develop minor source programs to 
attain and maintain NAAQS. The Federal regulations for minor source 
programs are considerably less detailed than the requirements for major 
sources. As a result, there is a wider variety of programs and 
requirements for these ``nonmajor'' preconstruction activities.
    Section 110(a)(2)(C) of the Act provides us with a broad degree of 
discretion in developing a program to regulate new and modified minor 
stationary source construction activities in Indian country.

B. Status of Air Quality Programs in Indian Country

    As we have discussed in previous rulemaking actions which affect 
Indian country, in the absence of an EPA-approved program, we are 
authorized to develop a FIP to protect air quality by directly 
implementing provisions of the Act throughout Indian country. See, 
e.g., 59 FR 43958-61 (August 25, 1994), 63 FR 7262-64 (February 12, 
1998), and 62 FR 13750 (March 21, 1997). Previously, we had already 
promulgated rules establishing requirements for major stationary 
sources in attainment areas and have issued PSD permits in Indian 
country (See 40 CFR 52.21).
    Under the Act and the Tribal Authority Rule (TAR) (See 40 CFR part 
49, subpart A), eligible tribes may seek approval of their own PSD 
programs for their reservations and/or for other areas under their 
jurisdiction. Currently, no tribe is administering an EPA-approved PSD 
program. Therefore, we implement the PSD program in Indian country. 
Unlike for the PSD program, there is currently no FIP to implement 
either the nonattainment major NSR program or the minor NSR program in 
Indian country. Hence, there is a regulatory gap in Indian country. 
Today's proposed rule will allow us to fully implement the NSR program 
in Indian country. We are proposing the minor NSR program at 40 CFR 
49.151 through 49.165 and the nonattainment major NSR program at 40 CFR 
49.166 through 49.175. It is important to recognize, however, that even 
if we adopt a Federal program that applies in Indian country, the 
tribes may still develop Tribal Implementation Plans (TIPs), similar to 
SIPs, to implement these programs. If a tribe develops a TIP to 
implement NSR, the TIP, once it is approved, will replace the Federal 
program as the requirement for that area of Indian country and the 
tribe will become the reviewing authority.
    Sources that obtain enforceable emission limitations can avoid 
major source status by reducing their PTE below the applicable major 
source thresholds. Such sources are commonly referred to as ``synthetic 
minors.'' The practice of creating synthetic minor sources to avoid 
major NSR and title V is common under most State and local minor NSR 
permitting programs. However, outside of Idaho, Oregon, and Washington, 
no such minor source permitting mechanism is currently available in 
Federal regulations for Indian country.\4\ We therefore believe that 
inclusion of this provision in the proposed rules would significantly 
benefit large sources in Indian country by providing them with a means 
to legally avoid more stringent major NSR rules otherwise required by 
title I of the Act. We are establishing this mechanism for both 
stationary sources of regulated NSR pollutants and HAPs.
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    \4\ See footnote 2 for more information on the FIP that is in 
place in within the exterior boundaries of Indian reservations in 
these three States.
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C. Consultation With Tribal Representatives

    Prior to undertaking this rulemaking, we sought to include tribes 
early in the rulemaking process. On June 24, 2002, we sent 
approximately 500 letters to tribal leaders seeking their 
recommendations for effective consultation and their involvement in 
developing this rule.
    We received responses from 75 tribes. Of these 75 tribes, 69 
designated an environmental staff member to work with us on developing 
the rules. Aside from the designated staff, many tribal leaders asked 
that we keep them informed of our progress through e-mail, meetings 
with the EPA Regional Offices, newsletters, and Web sites. However, 53 
percent of the tribal leaders also requested direct phone calls or 
conference calls to discuss the subject. Only 16 percent of the 
respondents requested face-to-face consultation. Of these, only six 
tribes requested senior EPA staff to meet with tribal leaders.
    As a result of this feedback, we developed a consultation plan that 
included three meetings held at the reservations of the Menominee Tribe 
in Wisconsin, the Mohegan Tribe in Connecticut, and the Chehalis Tribe 
in Washington. A fourth meeting was held in conjunction with the 
Institute of Tribal Environmental Professionals' (ITEP) 10th 
anniversary meeting in Flagstaff, Arizona. In addition to conducting 
these meetings, we also visited tribal environmental staff in Indian 
country. Over 30 tribes attended these meetings. As part of our 
outreach efforts to the tribes, we participated in numerous national 
and regional forums including the National Tribal Forums sponsored by 
the ITEP, two National Tribal Air Association meetings, and at meetings 
with tribal consortia, such as the National Tribal Environmental 
Council, United Southern and Eastern Tribes, Inter-Tribal Environmental 
Council, Inter Tribal Council of Arizona, and others.
    Although much of our effort focused on outreach to the tribes, we 
also interacted with State and local air pollution control agencies 
during development of this rule. We had two meetings with the State and 
Territorial Air Pollution Program Administrators and the Association of 
Local Air Pollution Control Officers (STAPPA/ALAPCO) to present the 
draft rules.

IV. Proposed Rules for Indian Country

A. Minor NSR Program

    Today's action proposes provisions for a minor NSR program in 
Indian country. We propose to codify these provisions at 40 CFR 49.151 
through 49.165. Our primary goal in developing this proposed rule is to 
ensure that air resources in Indian country will be protected in the 
manner intended by the Act. In addition, we seek to establish a 
flexible preconstruction permitting program for minor stationary 
sources in Indian country that is comparable to that which applies 
outside of Indian country, in order to create a more level regulatory 
playing field for owners and operators within and outside of Indian 
country.
    It is important to note, however, that outside of Indian country 
there is a great deal of variation among State minor NSR permitting 
programs. As a result, it would be impossible to create a single 
program that creates precisely equivalent regulations among all areas 
of Indian country and the surrounding State areas. Instead, we designed 
the proposed rules to ensure that stationary sources in Indian country 
would operate with a reasonable level of air pollution control, if 
necessary, and in such a manner to ensure that air resources in Indian 
country would be protected.
    We are not attempting through this proposed rulemaking to establish 
a new set of minimum criteria that an eligible tribe, or a State, would 
need to follow in developing its own minor source permitting program. 
Rather, this proposal simply represents how we would implement the 
program in Indian country in the absence of an EPA-approved 
implementation plan. However, if a tribe is developing its own program, 
this can serve as one example of a program that meets the objectives

[[Page 48701]]

and requirements of the Act. We are proposing a minor source permitting 
program that addresses, on a national level, many environmental and 
regulatory issues that are specific to Indian country. We understand 
that States and eligible tribes may face different issues, and may 
therefore choose to develop different programs for their own State or 
Tribal Implementation Plans.
1. What is a minor source and which minor sources are subject to this 
rule?
    A minor source means a source whose PTE is lower than an applicable 
major source threshold. For the NSR program in Indian country, the 
major source thresholds are defined in the PSD program (See 40 CFR 
52.21) and in today's proposed nonattainment major NSR program (see 
proposed 40 CFR 49.167), as applicable, and differ for attainment areas 
and nonattainment areas for the same pollutant. For example, in 
attainment areas the major source threshold for Nitrogen Oxides 
(NO<INF>X</INF>) for a source is 250 tpy, unless the source belongs to 
a source category that is listed in the major NSR rules (See 40 CFR 
52.21(b)(1)(i)(a)), in which case the major source threshold is 100 
tpy. In contrast, the major source threshold for NO<INF>X</INF> in 
ozone nonattainment areas can vary from 10tpy in an extreme ozone 
nonattainment area to 100 tpy in a marginal ozone nonattainment area. A 
source can be a major source for some pollutants and a minor source for 
others.
    Today, we are proposing to establish a minor NSR threshold as 
provided in section IV.A.3 of this preamble. The proposed rule would 
apply to only those minor sources whose PTE is equal to or greater than 
the minor NSR threshold for the regulated NSR pollutant. Such sources 
would include (1) New minor sources, (2) modified minor sources, and 
(3) synthetic minor sources including HAP sources. A source's PTE for a 
pollutant is expressed in tpy and generally is calculated by 
multiplying the maximum hourly emissions rate in pounds per hour (lbs/
hr) times 8,760 (which is the number of hours in a year) and dividing 
by 2,000 (which is the number of pounds in a ton), unless the source is 
restricted by permit conditions that are enforceable as a practical 
matter.
    Section IV.A.6 of this preamble includes detailed flowcharts to aid 
you in determining if a proposed new source would be subject to the 
proposed rule. The flowcharts differentiate between attainment areas 
and nonattainment areas because the applicability criteria are 
different for PSD and nonattainment major NSR.
2. What is a modification and what modifications are subject to this 
rule?
    For the purposes of this rule, a modification is defined at 
proposed 40 CFR 49.152(d) as (any physical or operational change at a 
stationary source that would cause an increase in the allowable 
emissions of the affected emissions units for any regulated NSR 
pollutant or that would cause the emission of any regulated NSR 
pollutant not previously emitted.( The following exemptions would 
apply:
    <bullet> A physical or operational change does not include routine 
maintenance, repair, or replacement.
    <bullet> An increase in the hours of operation or in the production 
rate is not considered an operational change unless such increase is 
prohibited under any federally-enforceable permit condition or other 
permit condition that is enforceable as a practical matter.
    <bullet> A change in ownership at a stationary source is not 
considered a modification.
    Note that this definition differs from the term ``modification'' as 
used in the major NSR program, primarily in that it is based on an 
increase in allowable emissions rather than actual emissions. Parts C 
and D of title I of the Act ``the statutory basis for the major NSR 
program` refer to section 111(a)(4) of the Act [the definition of 
``modification'' for purposes of the new source performance standards 
(NSPS) program] to define ``modification'' for purposes of the major 
NSR program. In a recent decision, the D.C. Circuit Court of Appeals 
ruled that, based on the wording of the definition of ``modification'' 
in section 111(a)(4) of the Act, the applicability of major NSR to 
modifications must be based on changes in actual emissions (State of 
New York, et al., v. U.S. EPA, June 24, 2005). However, because the 
statutory basis for the minor NSR program is section 110(a)(2)(C) of 
the Act, which does not define or refer to a definition of 
``modification,'' we believe that we have discretion in defining the 
term as we think it best for the minor NSR program in Indian country 
that we are proposing today. We do not believe that the recent decision 
of the D.C. Circuit Court of Appeals applies to minor NSR programs. We 
seek comment on whether our proposed definition of modification is 
appropriate for minor NSR for minor sources.
    This rule would apply to certain modifications at minor sources and 
to minor modifications (not major modifications as defined in proposed 
40 CFR 49.167 and in 40 CFR 52.21) at major sources. How such 
modifications would be addressed under the proposed rule is explained 
in section IV.A.6 of this preamble. Section IV.A.6 also includes 
detailed flowcharts to aid you in determining if a proposed 
modification would be subject to the proposed rule.
3. What are the minor NSR thresholds and how did we develop them?
    A review of several State minor NSR programs indicated that a 
number of State programs have established cutoff levels or minor NSR 
thresholds, below which sources are exempt from their minor NSR rules. 
We believe that such an approach is also appropriate in Indian country. 
Section 110(a) (2)(C) of the Act requires minor NSR programs to assure 
that the NAAQS are attained and maintained. Applicability thresholds 
are proper in this context provided that the sources and modifications 
with emissions below the thresholds are inconsequential to attainment 
and maintenance of the NAAQS. As discussed further, the minor NSR 
thresholds that we are proposing today meet this criterion. In 
addition, these thresholds will result in a more cost-effective program 
and reduce the burden on sources and reviewing authorities.
    In today's rulemaking, we are proposing to adopt minor NSR 
thresholds as emission rates in tpy. In setting the minor NSR 
thresholds for minor sources of regulated NSR pollutants, we decided to 
use emission rates, rather than air quality impacts, as the basis for 
the exemption. We chose this approach because we were concerned that 
applicability determinations based on projected air quality impacts 
would be excessively complex and resource intensive. In addition, it is 
consistent with the approach used in major NSR.
    We are proposing minor NSR thresholds that we have developed based 
on a review of several State minor NSR programs. We found that there is 
variation in State approaches to minor NSR applicability. Some States 
do not prescribe source applicability thresholds, instead providing a 
list of emission units and activities that are excluded from minor NSR. 
Many of the States that do have applicability thresholds also provide a 
list of excluded emission units and activities. In today's rulemaking, 
we propose threshold levels that we believe are neither the most 
stringent nor the least stringent of the levels found in existing State 
minor NSR rules. These threshold levels represent a reasonable balance 
between environmental protection and

[[Page 48702]]

economic growth, since we did not want them to be so high that they 
were not environmentally protective or so low that they ensured 
environmental protection at the cost of discouraging economic growth. 
We consider the proposed thresholds to be representative of such 
thresholds in State minor NSR programs, and we believe that these 
limits will be appropriate for use in Indian country. The proposed 
thresholds are listed in Table 1.

                                         Table 1.--Minor NSR Thresholds
----------------------------------------------------------------------------------------------------------------
                                                                Minor NSR thresholds for
                                                               nonattainment areas  (tpy)         Minor NSR
                  Regulated NSR pollutant                   --------------------------------    thresholds for
                                                              Extreme ozone                    attainment areas
                                                                  areas        Other areas          (tpy)
----------------------------------------------------------------------------------------------------------------
Carbon monoxide (CO).......................................               5               5                   10
Oxides of nitrogen (NOX)...................................               0               5                   10
Sulfur dioxide (SO2).......................................               5               5                   10
Volatile Organic Compounds (VOC)...........................               0               2                    5
PM.........................................................               5               5                   10
PM-10......................................................               1               1                    5
PM-2.5.....................................................             0.6             0.6                    3
Lead.......................................................             0.1             0.1                  0.1
Fluorides..................................................              NA              NA                    1
Sulfuric acid mist.........................................              NA              NA                    2
Hydrogen sulfide (H2S).....................................              NA              NA                    2
Total reduced sulfur (including H2S).......................              NA              NA                    2
Reduced sulfur compounds (including H2S)...................              NA              NA                    2
Municipal waste combustor emissions........................              NA              NA                    2
Municipal solid waste landfills emissions (measured as Non               NA              NA                   10
 Methane Organic Compounds)................................
----------------------------------------------------------------------------------------------------------------

    The selected minor NSR thresholds distinguish between minor 
stationary sources of regulated NSR pollutants located in nonattainment 
versus attainment areas and by pollutant. We believe this distinction 
is important because of the different air quality goals in 
nonattainment and attainment areas.
    In some cases, a tribe's area of Indian country may be divided 
between a nonattainment area and an attainment area. In this situation, 
the applicable threshold for a proposed source or modification would 
correspond to the designation of the area where the source would be 
located. If a source straddles the two areas, the more stringent 
thresholds would apply.
    To evaluate how the proposed minor NSR thresholds might affect new 
sources locating in Indian country, we looked at the size distribution 
of existing sources across the country. Using the National Emission 
Inventory (NEI), which includes the most comprehensive inventory of 
existing U.S. stationary point sources that is available, we determined 
how many of these sources fall below the proposed minor NSR thresholds, 
how many are between the minor NSR and major NSR thresholds, and how 
many are above the major NSR threshold.\5\ If we assume that the 
distribution of new sources will mirror the existing source 
distribution, this analysis approximates the fraction of new sources 
that will be exempt from minor NSR, subject to minor NSR, and subject 
to major NSR, respectively. The results of this analysis by pollutant 
are summarized in Table 2.
---------------------------------------------------------------------------

    \5\ For this analysis, we used the final 1999 NEI, extrapolated 
to 2001. More on the 1999 NEI can be found at http://www.epa.gov/ttn/chief/net/1999inventory.html.

                                   Table 2.--Distribution of Sources and Emissions Under Proposed Minor NSR Thresholds
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                    Total facilities      Unregulated minor       Minor sources         Major sources
                                                                 ----------------------        sources       -------------------------------------------
                            Pollutant                                                  ----------------------
                                                                   No. (x10   TPY (x10     % of                  % of     % of TPY     % of     % of TPY
                                                                      3)         6)       total     % of TPY    total                 total
--------------------------------------------------------------------------------------------------------------------------------------------------------
CO..............................................................       28.9       4.43         65        0.8         29         11          6         88
SO2.............................................................       21.2      13.90         76        0.1         16          1          8         99
PM10............................................................       33.9       1.69         65        1.3         32         22          4         76
PM2.5...........................................................       33.8       1.33         59        0.8         38         23          3         76
Ozone--VOC......................................................       43.3       1.60         42        1.1         53         41          5         58
Ozone--NOX......................................................       30.5       7.93         53        0.4         36          6         11         93
Nitrogen dioxide (NO2)..........................................       30.5       7.93         59        0.6         32          7          9         92
--------------------------------------------------------------------------------------------------------------------------------------------------------

    As shown in Table 2, we performed the analysis for each of the 
criteria pollutants except lead, including VOC and NO<INF>X</INF> 
emissions as the precursors of ozone.\6\ For each pollutant, the table 
gives the total number of facilities in the emission inventory for that 
pollutant and the total, nationwide annual emissions of the pollutant. 
The column

[[Page 48703]]

labeled ``unregulated minor sources'' represents the percentage of 
total sources that fall below the minor NSR threshold, along with the 
percentage of total annual emissions that those sources emit. The 
``minor sources'' column gives the same information for sources that 
fall between the minor NSR threshold and the major NSR threshold, while 
the ``major sources'' column addresses sources that exceed the major 
NSR threshold.
---------------------------------------------------------------------------

    \6\ For the analysis, we used the major NSR and proposed minor 
NSR thresholds for each pollutant based on the attainment status and 
classification of the county in which each source is located. We 
made certain simplifying assumptions, including using the 250 tpy 
major source threshold for all sources in attainment areas, 
regardless of source category or major source status for other 
pollutants. For the details of the analysis,see ``Analysis of the 
Proposed Minor NSR Thresholds'' dated October 24, 2005 in the docket 
for this rulemaking.
---------------------------------------------------------------------------

    We believe that Table 2 provides excellent evidence that sources 
with emissions below the proposed minor NSR thresholds will be 
inconsequential to attainment and maintenance of the NAAQS. For each 
pollutant, only around 1 percent (or less) of total emissions would be 
exempt from review under the minor NSR program. At the same time, the 
proposed thresholds will promote a cost-effective program. According to 
Table 2, anywhere from 42 percent to 76 percent of sources (depending 
on the pollutant) would be too small to be subject to preconstruction 
review.
    We believe that the proposed minor NSR thresholds provide a 
reasonable approach to determining the applicability of the minor NSR 
program. These thresholds would prevent stationary sources that make 
negligible contributions to pollution from being regulated under this 
rule. However, this would not affect the applicability of other 
requirements, such as those found in an NSPS or a MACT standard. At the 
same time, the limits would ensure that intermediate-sized sources 
would be subject to reasonable control technology requirements. We seek 
comment on our approach to selecting the proposed minor NSR thresholds, 
on alternative approaches to selecting such thresholds, and on 
alternative applicability provisions (such as source category 
exemptions).
4. Are any emissions units and activities at stationary sources exempt 
from this rule?
    Certain emissions units and activities at stationary sources either 
do not emit regulated NSR pollutants to the ambient air or emit these 
pollutants in negligible amounts. We propose that such activities 
located at a minor source be exempt from the requirements of this rule 
(See proposed 40 CFR 49.153(c)). We propose that such activities are 
limited to the following:
    <bullet> Air-conditioning units for comfort that are not subject to 
applicable requirements under title VI of the Act and do not exhaust 
air pollutants into the ambient air from any manufacturing or 
industrial process;
    <bullet> Ventilating units for comfort that do not exhaust air 
pollutants into the ambient air from any manufacturing or other 
industrial process;
    <bullet> Heating units for comfort that do not provide heat for any 
manufacturing or other industrial process;
    <bullet> Noncommercial food preparation;
    <bullet> Consumer use of office equipment and products;
    <bullet> Janitorial services and consumer use of janitorial 
products;
    <bullet> Internal combustion engines used for landscaping purposes;
    <bullet> Bench scale laboratory activities, except for laboratory 
fume hoods and vents; and
    <bullet> Any emissions unit or activity that does not have the 
potential to emit a regulated NSR pollutant or HAP, so long as that 
emissions unit or activity is not part of a process unit that emits or 
has the potential to emit a regulated NSR pollutant or HAP.
5. What are the permit application, control technology, and air quality 
analysis requirements, and what is the permit issuance process?
    Permit Application Requirements. Under today's proposed minor NSR 
program, as the owner or operator of a proposed new minor source or a 
proposed modification that is subject to this rule, you must submit a 
complete application to your reviewing authority requesting a minor NSR 
permit specific to your source (unless you wish to seek a ``general 
permit,'' if eligible). In addition to basic information identifying 
and describing your source, your application must include a list of all 
affected emissions units. ``Affected emissions units'' are defined as 
all the emissions units at your proposed new minor source or all the 
new, modified, and replacement emissions units that comprise your 
proposed modification (excluding the exempt emissions units and 
activities listed in proposed 40 CFR 49.153(c)). See proposed 40 CFR 
49.152(d).
    Your application also must document the increase in emissions of 
regulated NSR pollutants that will result from your new source or 
modification so that the reviewing authority can verify that you are 
subject to this proposed minor NSR program, rather than to major NSR. 
For each new emissions unit that you list, you must provide the PTE in 
tpy for each regulated NSR pollutant, along with supporting 
documentation. For any modified or replacement unit that you list, you 
must provide the allowable emissions of each regulated NSR pollutant in 
tpy both before and after the modification or replacement, along with 
supporting documentation. For emissions units that do not have an 
established allowable emissions level prior to the modification, you 
must report the PTE. The allowable emissions for any emissions unit are 
calculated considering any emission limitations that are enforceable as 
a practical matter on the unit's PTE. In calculating these emission 
levels for applicability purposes, we seek comment on whether you 
should include fugitive emissions, to the extent that they are 
quantifiable, for all sources, or include them only for source 
categories listed pursuant to section 302(j) of the Act or exclude them 
for all sources.
    You may include in your application proposed emission limitations 
for the listed emissions units. If you do, you must account for these 
limitations in your calculations of post-construction PTE and/or 
allowable emissions. The application also must identify and describe 
any existing air pollution control equipment and compliance monitoring 
devices or activities relevant to the affected emissions units, as well 
as any existing emission limitations or work practice requirements to 
which any affected emissions units are subject. See proposed 40 CFR 
49.154(a) for the complete requirements for your application for a 
minor NSR permit.
    You may request that the reviewing authority establish an annual 
minor source plantwide applicability limitation (minor source PAL) for 
one or more of the regulated NSR pollutants emitted by your new or 
existing minor stationary source. A minor source PAL is a source-wide 
limitation on allowable emissions of a regulated NSR pollutant, 
expressed in tpy, that is established under the proposed 40 CFR 49.155 
and that is enforceable as a practical matter (See proposed 40 CFR 
49.152(d)).
    For a new minor stationary source, you may request minor source 
PALs for some or all of the regulated NSR pollutants emitted by your 
source. For the other regulated NSR pollutants that your source emits 
(i.e., the non-PAL pollutants), your permit will contain annual 
allowable emissions limits for each emissions unit.
    You may request a minor source PAL for one or more regulated PAL 
pollutants at the time that you are modifying an existing minor 
stationary source. Each PAL will apply across all the emissions units 
at your source, whether or not they are affected by the modification. 
For the non-PAL pollutants, only the emissions units that are affected 
by the modification will receive annual allowable emissions limits. If 
you request one or more minor source PALs for an existing minor 
stationary source at a time when no

[[Page 48704]]

modification is planned, each PAL will apply across all the emissions 
units at your source, but your permit will include no new emission 
limits for the non-PAL pollutants.
    If your source is in a source category covered by a ``general 
permit'' issued under proposed 40 CFR 49.156, you may apply for the 
general permit for that source category. A general permit is a permit 
developed by your reviewing authority for a general category of 
emissions units or stationary sources that are similar in nature, have 
substantially similar emissions, and would be subject to the same or 
substantially similar requirements governing operations, emissions, 
monitoring, reporting, and recordkeeping. The permit application 
requirements for a particular general permit will be specified in that 
general permit. General permits are discussed further in section 
IV.A.13 of this preamble.
    Control Technology Review. As required under section 110(a)(2)(C) 
of the Act, the minor NSR permitting program that we are proposing 
today is primarily designed to assure that the NAAQS are achieved, and 
to prohibit any stationary source from emitting any air pollutant in 
amounts that would contribute to nonattainment or interfere with 
maintenance of the NAAQS. At the same time, we wish to provide 
flexibility in control technology requirements for minor sources 
located in Indian country to promote economic growth and development.
    Therefore, in today's proposal, we are proposing that your 
reviewing authority perform a control technology review on a case-by-
case basis when issuing the permit (other than a general permit). By 
``control technology,'' we mean pollution prevention techniques, add-on 
pollution control equipment, design and equipment specifications, work 
practices, and operational restrictions. This review would consider 
local air quality needs, typical control technology used by similar 
sources in surrounding areas, anticipated economic growth in the area, 
and cost-effective control alternatives. At a minimum, the reviewing 
authority must require control technology that assures that the NAAQS 
are achieved and that each affected emissions unit will comply with all 
requirements of 40 CFR parts 60, 61, and 63 that apply. The required 
control technology resulting from such a review may range from 
technology that is less stringent than the reasonably available control 
technology (RACT) level of control (which is typically required for 
existing major sources in nonattainment areas), to technology that is 
the BACT level of control (which is the level required for new major 
sources and major modifications in attainment areas), depending on the 
air quality needs of the area, other applicable regulatory programs of 
the Act, and technical and economic feasibility.
    Based on the results of the control technology review, the emission 
limitations required by the reviewing authority may consist of emission 
limits, pollution prevention techniques, design standards, equipment 
standards, work practice standards, operational standards, or any 
combination thereof. If it is technically and economically feasible, 
the reviewing authority must require an emission limit (i.e., a limit 
on the quantity, rate, or concentration of emissions) for each affected 
emissions unit at your source.
    For a new minor source that is subject to this rule, the case-by-
case control technology review would be conducted for all emissions 
units [except the exempt emissions units and activities discussed in 
section IV.A.4 and listed in proposed 40 CFR 49.153(c)] that emit or 
have the potential to emit the pollutant for which the source is 
subject to this rule. However, for modifications, such control 
technology review would apply only to the affected emissions unit(s).
    In establishing a case-by-case control technology review process to 
determine an appropriate level of control for minor sources and subject 
modifications in Indian country, we considered a number of factors. On 
the one hand, we believe that the control technology review process 
should be as flexible as possible to provide for the specific needs and 
conditions of each area of Indian country, consistent with the 
requirements of the Act. On the other hand, we believe that a 
reasonable level of air pollution control for new minor sources and 
subject modifications in Indian country is generally warranted to 
ensure protection of air resources in Indian country. In addition, we 
wish to ensure that Indian country not be seen as a potential 
``pollution haven'' where minor stationary sources can go to escape air 
pollution control requirements. At the same time, we do not want to put 
tribes or owners and operators locating in Indian country at a 
competitive disadvantage by requiring substantially more stringent 
controls in Indian country than are required in the surrounding areas.
    We are seeking comment on the proposed case-by-case control 
technology review for all new and modified sources subject to this 
minor NSR program. We also request comment on whether the program 
should have a control technology requirement at all. Section 
110(a)(2)(C) of the Act requires a minor NSR program that assures that 
the NAAQS are achieved, but does not mandate that the program include a 
control technology requirement. We are seeking comment on whether a 
control technology requirement is necessary to achieve the purposes of 
the Act, or whether other approaches can achieve these purposes just as 
well with less cost or administrative burden.
    Air Quality Impacts Analysis. Typically, for a new or modified 
minor source permit application, your reviewing authority would not 
require an Air Quality Impacts Analysis (AQIA). In rare instances, if 
your reviewing authority has reason to be concerned that the 
construction of your minor source or modification could cause or 
contribute to a NAAQS or PSD increment violation, to ensure protection 
of the NAAQS, we are proposing that your reviewing authority may 
require you to conduct an AQIA using dispersion modeling in accordance 
with 40 CFR part 51, appendix W to determine the impacts that will 
result from your new source or modification. If the AQIA demonstrated 
that the construction of your source or modification would cause or 
contribute to a NAAQS or PSD increment violation, you would be required 
to further reduce its impact before you could obtain a permit.
    Permit Issuance Process. Within 45 days after receiving your permit 
application, your reviewing authority must either determine that the 
permit application is complete enough to commence a technical review or 
request additional information. If you do not receive a request for 
additional information or a notice of complete application within 50 
days of your permitting authority's receipt of your application, your 
application would be deemed complete. (You should contact your 
reviewing authority to find out the date that it received your 
application so that you will know when this 50-day period is up.) Once 
the application is complete, your reviewing authority develops a draft 
permit and provides a public notice seeking comments on the draft 
permit for a 30-day period. After considering all timely, relevant 
comments, if your reviewing authority determines that your application 
meets all applicable requirements, it would issue you a final permit. 
Otherwise, the reviewing authority would send you a letter denying your 
permit application with reasons for the denial. We seek comment on the 
proposed permit issuance process.

[[Page 48705]]

    We are proposing that your reviewing authority would issue you a 
permit with an allowable emissions limit in tpy for each affected 
emissions unit (Option A). You have the alternative of requesting a 
minor source PAL or cap in tpy (Option B), and your reviewing authority 
may issue such a permit. This type of permit can provide the 
flexibility to make frequent changes at your source without permit 
review. If you wish, you may request a minor source PAL for some 
pollutants and allowable emissions limits for each emissions unit for 
other pollutants.
    Permit Term. A preconstruction permit does not expire. Your permit 
remains valid as long as you commence construction of your new source 
or modification within 18 months after the effective date of the 
permit, you do not discontinue construction for a period of 18 months 
or more, and you complete construction in a reasonable time. Your 
reviewing authority may extend the 18-month period where justified. The 
18-month limit does not apply to the time period between construction 
of approved phases of a phased construction program; you must commence 
construction of each such phase within 18 months of the approved 
commencement date for that phase.
6. When are modifications subject to this rule?
    As discussed in section IV.A.2 of this preamble, for the purposes 
of the minor NSR program proposed today, a modification means any 
physical or operational change at a stationary source that would cause 
an increase in the allowable emissions of the affected emissions units 
for any regulated NSR pollutant or that would cause the emission of any 
regulated NSR pollutant not previously emitted (with the exclusions 
outlined in section IV.A.2 of this preamble). The proposed rule would 
apply to certain modifications at your minor sources and minor 
modifications at your major sources. For such modifications, you would 
have to meet the application requirements and comply with any control 
technology requirements as discussed in section IV.A.5 of this 
preamble. In rare instances, if your reviewing authority has reason to 
believe that your modification could result in a violation of the NAAQS 
or PSD increment, you would be required to conduct an AQIA.
    In all NSR applicability determinations, you must evaluate each 
regulated NSR pollutant individually. The area where your source is 
located may be attainment for some pollutants and nonattainment for 
others, which affects which pollutants are regulated as well as the 
major and minor NSR applicability thresholds. For a given modification, 
a particular pollutant may be subject to review under PSD, 
nonattainment major NSR, or minor NSR, or may not be subject to any of 
these programs.
    The first step in determining whether your proposed physical or 
operational change is subject to the minor NSR program proposed today 
is to determine whether the change is subject to the applicable major 
NSR program (i.e., proposed 40 CFR 49.167 or 40 CFR 52.21 for 
nonattainment and attainment areas, respectively). If you are changing 
an existing major source, you would determine whether the change 
qualifies as a major modification using the procedures in the 
applicable major NSR program. If you are changing an existing minor 
source, you would determine whether the change would qualify as a major 
stationary source by itself under the applicable major NSR program. If 
your proposed physical or operational change is subject to review under 
major NSR for a regulated NSR pollutant, it is not subject to the minor 
NSR program for that pollutant.
    If your proposed physical or operational change is not subject to 
major NSR, the next step is to determine whether the change qualifies 
as a modification under the minor NSR program. To be a modification, 
the change must result in an increase in allowable emissions at your 
source. Thus, the next step is to calculate whether, and by how much, 
allowable emissions would increase as a result of the change. If your 
minor stationary source is subject to a minor source PAL for a 
regulated NSR pollutant (Option B in section IV.A.5 of this preamble), 
the emissions increase for that pollutant would be the PAL level after 
the physical or operational change minus the PAL level prior to the 
change. For physical or operational changes at other minor stationary 
sources (i.e., those with annual allowable emissions limits for each 
emissions unit (Option A), those that are unpermitted, and those with a 
combination of unpermitted emissions units and emissions units with 
annual allowable emissions limits) and at major stationary sources, the 
total increase in allowable emissions resulting from your proposed 
change would be the sum of the following:
    <bullet> For each new emissions unit that is to be added, the 
emissions increase would be the PTE of the unit.
    <bullet> For each emissions unit with an allowable emissions limit 
that is to be changed or replaced, the emissions increase would be the 
allowable emissions of the emissions unit after the change or 
replacement minus the allowable emissions prior to the change or 
replacement. This may be a negative value for an emissions unit if its 
allowable emissions would be reduced as a result of the change or 
replacement.
    <bullet> For each unpermitted emissions unit that is to be changed 
or replaced, the emissions increase would be the allowable emissions of 
the unit after the change or replacement minus the PTE prior to the 
change or replacement. It is necessary to use PTE since these emissions 
units will not have a allowable emissions limit prior to the change. 
This may be a negative value for an emissions unit if its post-change 
allowable emissions would be less than its pre-change PTE.
    This process of summing the emissions increases and decreases 
across all the affected emissions units is called ``project netting,'' 
which is discussed later in this section of the preamble.
    If your proposed physical or operational change qualifies as a 
modification (i.e., causes an increase in allowable emissions), the 
final step in determining whether the proposed modification is subject 
to today's proposed minor NSR program is to compare the increase in 
allowable emissions to the applicability criteria for the type of 
source and emission limits that you have. Your modification would be 
subject to the minor NSR program in the following circumstances:
    <bullet> If your minor source has a permit with a minor source PAL 
in tpy (Option B in section IV.A.5 of this preamble) and the 
modification would result in any increase in the PAL level. To 
determine if an increase in the PAL level is necessary, you must 
evaluate whether your source's actual emissions after the modification 
would exceed the PAL level by any amount. If you could construct and 
operate the modification without your actual emissions exceeding your 
minor source PAL, then no permit action would be required.
    <bullet> For other minor sources, if the modification would 
increase total allowable emissions from the affected emissions units by 
an amount that equals or exceeds any of the minor NSR thresholds listed 
in Table 1 of this preamble.
    <bullet> If the minor modification at your major source would 
increase total allowable emissions from the affected emissions units by 
an amount that equals or exceeds any of the minor NSR thresholds listed 
in Table 1 of this preamble.
    <bullet> In addition, if the modification would increase allowable 
emissions from any emissions unit above an

[[Page 48706]]

established unit-specific allowable emission permit limit, even if the 
total increase for your source would be less than the corresponding 
minor NSR threshold listed in Table 1 of this preamble. In this case, 
the needed increase in the unit-specific allowable emissions permit 
limit can be accomplished through an administrative permit revision 
(See proposed 40 CFR 49.159(f)).
    In addition, a physical or operational change may be subject to 
today's proposed minor NSR program even if it is not classified as a 
modification (i.e., it does not increase allowable emissions of a 
regulated NSR pollutant or result in emission of a pollutant not 
previously emitted). For example, a proposed change might increase 
allowable emissions from some emissions units and decrease emissions at 
others so that, overall, emissions from the affected units would stay 
the same or decrease. If the post-change emissions at any emissions 
unit would exceed a permitted allowable emissions limit for that unit, 
you must apply to revise the existing permit limit before you may 
implement the change. The needed increase in the unit-specific 
allowable emissions permit limit can be accomplished through an 
administrative permit revision (See proposed 40 CFR 49.159(f)).
    Similarly, other proposed physical or operational changes that 
could not be implemented within the requirements of an existing permit 
would necessitate a permit revision, even if they are not otherwise 
subject to major or minor NSR. We believe that this fact will serve to 
ensure that the types of changes that could significantly alter the 
dispersion characteristics of the air pollutants emitted by your source 
will be brought to the attention of your reviewing authority. Thus, the 
reviewing authority will be in the position to evaluate whether the 
change has the potential to increase ambient concentrations outside the 
boundaries of your source. If so, the reviewing authority can require 
measures to mitigate any unacceptable air quality impacts (i.e., to 
protect the NAAQS and PSD increments) as part of the permit revision 
process.
    Flowcharts to aid in determining major and minor NSR applicability 
are presented in Figures 1 through 6. These flowcharts illustrate the 
applicability process for new sources and modifications in attainment 
areas and nonattainment areas. The flowcharts should be used to 
evaluate each regulated NSR pollutant individually since different flow 
charts may apply to different pollutants depending on the attainment 
status of the area for each pollutant.
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[[Page 48713]]

7. Why do we believe that an allowable-to-allowable test is appropriate 
for minor sources?
    As discussed earlier, we are proposing an ``allowable-to-
allowable'' applicability test as the primary test for modifications 
under this minor NSR program. We evaluated the three basic types of 
applicability tests (actual-to-potential, actual-to-projected-actual, 
and allowable-to-allowable) and determined that the allowable-to-
allowable test is most suitable for minor NSR in Indian country.
    We rejected the actual-to-potential test for many of the same 
reasons that we have moved away from this test in the major NSR 
program. In this type of system, the emissions increase that results 
from a change is determined by comparing the emissions unit's PTE after 
the change to its actual emissions prior to the change. If pre-change 
actual emissions are well below the unit's PTE, as is generally the 
case, any change will result in a large emissions increase when 
calculated in this manner. To avoid triggering NSR, a source must 
accept a limit on the unit's post-change PTE at a level that exceeds 
pre-change actual emissions by less than the applicable NSR threshold.
    As discussed in our December 2002 NSR Improvement rulemaking, there 
are numerous objections to the actual-to-potential test (67 FR 80194). 
Industry has long believed that the need to take a PTE limit to avoid 
NSR has the effect of unfairly confiscating the emissions unit's unused 
operating capacity even though, in many cases, the changed unit as a 
practical matter will function essentially as it did before the change 
and emissions to the environment will not increase. In addition, the 
actual-to-potential test discourages sources from making the types of 
changes that improve operating efficiency, implement pollution 
prevention projects, and result in other environmentally beneficial 
effects.
    In the December 2002 NSR Improvement rulemaking for major NSR, we 
promulgated an alternative ``actual-to-projected-actual'' test for 
major modifications. However, we do not propose to adopt the same 
course for the minor NSR program in Indian country. We believe that 
determining emissions changes in terms of changes in allowable 
emissions typically will be easier and more straightforward for the 
minor sources subject to this program. In particular, the major NSR 
procedures for projecting and tracking future actual emissions may be 
somewhat complicated for minor sources. While we believe that this 
system is within the capabilities of major sources, we believe that a 
simpler system is more appropriate for the minor sources in Indian 
country, many of which are unaccustomed to any type of regulation.
    We are proposing an allowable-to-allowable test for modifications 
in the Indian country minor NSR program. We believe that this 
relatively simple and straightforward system is most appropriate for 
the minor sources found in Indian country. In addition, we believe that 
it is beneficial to use allowable emissions as the currency for 
attainment planning, in that they represent the worst-case post-change 
emissions. This approach is consistent with section 173(a)(1)(A) of the 
Act, which requires new and modified major sources to obtain offsets 
based on allowable emissions. (While we are not requiring offsets for 
minor sources in Indian country nonattainment areas, we believe that 
the language in section 173(a)(1)(A) provides validation for our 
proposed minor NSR modification test.) Finally, we understand that many 
State minor NSR programs use an allowable-to-allowable test.
    As discussed in section IV.A.2 of this preamble, we believe that we 
have the discretion to use an allowable-to-allowable test for this 
minor NSR program because the statutory basis for minor NSR is section 
110(a)(2)(C) of the Act, rather than section 111(a)(4). We seek comment 
on using the proposed allowable-to-allowable test for addressing 
modifications and on the alternative of using the actual-to-projected-
actual test.
    As laid out in the second step for determining if a proposed 
modification is subject to minor NSR, we are proposing to allow 
``project netting.'' This means that both increases and decreases in 
allowable emissions are summed when determining the total emission 
increase that would result from a proposed modification.
    The major NSR program uses a two-step procedure for determining 
applicability. First, the emission increases from the proposed project 
are summed. If the total emission increase from the project is 
``significant'' (that is, equal to or greater than the major NSR 
threshold), the second step in the process is ``contemporaneous 
netting.''
    In contemporaneous netting, the emission increase due to the 
proposed modification is summed with all other emission increases and 
decreases that have occurred at the major source during the 
contemporaneous period (generally 5 years). If the net emission 
increase determined in this way is significant, the proposed 
modification is a ``major modification'' that is subject to review 
under major NSR.
    We considered including contemporaneous netting in today's minor 
NSR program, but have elected not to propose it as our preferred 
approach. Contemporaneous netting has proved to be a complicated aspect 
of the major NSR program. While major sources are accustomed to 
contemporaneous netting and have built the capacity to track emissions 
changes and carry out this procedure, many minor sources that would be 
covered by today's proposed minor NSR program lack such capacity. We 
believe that a simpler system is more appropriate for the minor sources 
in Indian country.
    Nevertheless, we believe that minor sources should be able to 
receive credit for the emission decreases that would result from a 
proposed modification. Hence, we are proposing to allow project netting 
in today's minor NSR program.
    We believe that project netting calculations are relatively 
straightforward and are within the capacity of most minor sources. For 
example, an existing minor source might wish to expand by adding a 
second production line to go with an existing, uncontrolled line. If 
the proposed project includes adding an air pollution control device to 
control emissions from both lines, it would result in an allowable 
emissions increase attributable to the new line, as well as an 
allowable emissions decrease from the existing, previously uncontrolled 
line. Determining the overall net emission change that would result 
from the proposed modification would be a straightforward exercise. 
However, to validate the project net emissions increase, as in the 
major NSR program, the source must take limits on allowable emissions 
for both lines that are enforceable as a practical matter.
    We believe that in proposing to allow project netting, but not 
contemporaneous netting, we have struck an appropriate balance for the 
minor NSR program in Indian country. We believe that the resulting 
program properly allows you to receive credit for emission reductions 
that are achieved as part of an overall project, without introducing 
too much complexity into the program. We invite comment on this 
approach, as well as on other approaches that would allow minor sources 
in Indian country to take credit for emission reductions.
8. Is your existing minor source subject to this rule?
    States develop, adopt, and submit to us for approval a SIP that 
contains a

[[Page 48714]]

broad range of measures to attain and maintain the NAAQS and to meet 
other requirements of section 110(a) of the Act. The SIPs typically 
include some emission limitations for existing sources, even those that 
do not modify their operations. Hence, a SIP provides an infrastructure 
to achieve the air quality goals of attaining and maintaining the 
NAAQS.
    Tribes are not required to submit implementation plans, and to 
date, very few tribes have sought our approval of such plan. Consistent 
with our approach to Federal implementation of the Act's requirements, 
we issue FIPs for areas of Indian country as necessary or appropriate. 
However, there is still a regulatory gap in relevant infrastructure in 
much of Indian country. Because of this unique situation, we are 
raising the question of whether it may be appropriate to regulate 
existing minor sources in Indian country under this minor NSR program 
to attain and maintain NAAQS. We are proposing Option 1 and soliciting 
comment on Options 2, 3, and 4:
    Option 1. Exempt existing minor sources from this rule. This option 
would not affect any existing sources (unless they propose a 
modification) and, thus, be the least burdensome for such sources in 
Indian country. Many State minor NSR rules do not apply to such 
sources; hence this would be consistent with many of the areas that 
surround Indian country. Under this option, we are seeking comment on 
whether such an exempt minor source should be allowed to opt for a 
permit under this program (without being subject to any of the 
requirements) merely to establish enforceable limits and conditions 
associated with a consent decree or other enforcement mechanism.
    Option 2. Require existing synthetic minor sources to become 
subject to the minor NSR program requirements (including control 
technology review and other requirements as provided in section IV.A.5. 
of this preamble) and to submit a permit application within 1 year 
after the effective date of the program. This option would draw into 
the regulatory scheme the biggest minor sources and may result in large 
emissions reductions in instances where the required control technology 
review would result in new or more stringent controls. Option 2 would 
affect relatively few existing minor sources in Indian country.
    Option 3. Require all existing minor sources to register within 1 
year after the effective date of this program, but not be subject to 
the permitting requirements. This option would affect all minor sources 
in Indian country, but would involve very little burden to sources, 
since this would be a one-time registration. Option 3 would allow your 
reviewing authority to collect information on the number and size of 
existing minor sources, which would assist with NAAQS maintenance and 
attainment planning in Indian country.
    Option 4. Require all existing minor sources to be subject to the 
minor NSR program requirements (as provided in section IV.A.5. of this 
preamble). While this option would result in significant emissions 
reductions, it would also require significant EPA resources and may 
also be overly burdensome on minor sources in Indian country. 
Additionally, we believe that subjecting all minor sources to this 
program is not necessary to achieve the NAAQS, as demonstrated by state 
minor NSR programs.
    We also seek comment on any other approaches for addressing 
existing minor sources.
9. How are ``synthetic minor sources'' subject to this rule?
    Some sources have the potential to emit one or more pollutant in 
major source amounts, but have actual emissions that are below the 
major source thresholds. One of our primary objectives for this 
rulemaking is to create a mechanism by which you can obtain emission 
limitations for such sources that are enforceable as a practical 
matter, so that they can become ``synthetic minor sources'' and avoid 
major source status. We are therefore proposing to create such a 
mechanism in 40 CFR 49.158 of the proposed rules. The proposed rules 
allow for designation of synthetic minor sources (for regulated NSR 
pollutants) and synthetic minor HAP sources. It is important to note 
that although you may choose to obtain such emission limitations at 
your own discretion, once you have accepted an enforceable emission 
limitation, you must comply with that limitation. This is necessary to 
ensure that you are legally prohibited from operating as a major 
source. We are taking comment on the proposal to allow your stationary 
sources to become synthetic minors in Indian country.
    Our 1999 policy memo on synthetic minor sources in Indian country 
currently provides guidance on how sources that would otherwise be 
major sources under section 302 or part D of title I of the Act can 
become synthetic minor sources if their actual emissions remain below 
50 percent of the relevant major source PTE threshold and they comply 
with all other requirements of the policy memo.\7\ However, as the memo 
specifies, this PTE transition policy terminates when we adopt and 
implement a mechanism that you can use to limit your PTE, or we 
explicitly approve a tribe's program providing such a mechanism. 
Today's proposed minor NSR program would provide such a mechanism. 
Therefore, upon the effective date of these rules when promulgated, the 
PTE transition policy will expire and you will have to obtain a permit 
under this minor NSR program for any subsequent synthetic minor 
sources.
---------------------------------------------------------------------------

    \7\ John S. Seitz and Eric V. Schaeffer. Policy memo. 
``Potential to Emit Transition Policy for Part 71 Implementation in 
Indian Country.'' March 7, 1999.
---------------------------------------------------------------------------

    Additionally, for your existing synthetic minor sources under the 
current policy, you will have 1 year from the effective date of the 
final rules to apply for a permit under the proposed minor NSR program. 
If you submit a permit application in accordance with the requirements 
of proposed 40 CFR 49.158(c) by that date, we will continue to consider 
your source a synthetic minor source until we issue a permit with 
synthetic minor limits. The permit will contain monitoring, 
recordkeeping, reporting, and testing requirements as needed to assure 
compliance with your synthetic minor permit, but will not impose any 
additional requirements. Should you fail to submit an application 
within 1 year of the effective date of the final rules, your source 
will no longer be considered a synthetic minor source or synthetic 
minor HAP source (as applicable), and will immediately become subject 
to all requirements for major sources.
10. How would section 112(g) case-by-case MACT determinations be 
addressed by this rule?
    Section 112(g)(2)(B) of the Act provides that you may not construct 
or reconstruct a major source of HAPs unless you install MACT. If the 
Administrator has not established a MACT standard for the source 
category, the Act requires that MACT must be determined on a case-by-
case basis.
    Where there is no EPA-approved program in an area of Indian 
country, we are the reviewing authority for case-by-case MACT under 
section 112(g)(2)(B). The requirement for a case-by-case MACT 
determination prior to construction or reconstruction of a major source 
of HAPs is found at 40 CFR 63.42(c). In 40 CFR 63.43(c), we provide a 
number of review options for these determinations. These options

[[Page 48715]]

include using a title V permit, applying for and obtaining a Notice of 
MACT Approval, and ``any other administrative procedures for 
preconstruction review and approval established by the reviewing 
authority for a State or local jurisdiction which provide for public 
participation * * *.'' Currently, no tribes have an EPA-approved title 
V permitting program or the ``other administrative procedures'' for 
this purpose, although one tribe has been delegated authority to assist 
us with implementation of the Federal part 71 operating permit program 
(i.e., the Federal program for issuing title V permits). While we can 
permit a section 112(g) case-by-case MACT determination through a part 
71 permit or a Notice of MACT Approval, we believe that if your source 
is major only for HAPs it would be administratively convenient for us 
and you to combine the construction permit process for both regulated 
NSR pollutants and HAPs under this proposed minor NSR program, rather 
than also go through the part 71 permit or Notice of MACT Approval 
process to address HAPs. Therefore, we are proposing to allow for 
review of section 112(g) case-by-case MACT determinations through this 
minor NSR program and seek comment on this approach. See proposed 40 
CFR 49.153(a)(5) for the provisions related to section 112(g) case-by-
case MACT determinations. Note that you ultimately will have to obtain 
a part 71 permit for your major source of HAPs.
11. What are the proposed requirements for public participation in the 
permitting process?
    Our requirements for State preconstruction review programs at 40 
CFR 51.161 require such programs to provide for public availability of 
permit applications as well as the reviewing authority's analysis of 
the application. In addition, State programs must provide opportunity 
for public comment on permitting actions. To be consistent with these 
requirements for State programs, we are proposing to require the 
reviewing authority to make non-confidential information on the permit 
available to the public and to provide public notice and an opportunity 
to comment on the draft minor NSR permit. See proposed 40 CFR 49.157.
    Specifically, we would require that the reviewing authority prepare 
a draft permit and provide adequate public notice to ensure that the 
affected community and the general public have reasonable access to the 
application and draft permit information. The reviewing authority must 
make such information available for public inspection at the 
appropriate EPA Regional Office and in at least one location in the 
area affected by the source, such as the tribal environmental office or 
a local library. The public notice must provide an opportunity for 
public comment and a public hearing on the draft permit. The 
appropriate types of notice may vary depending on the proposed project 
and the area of Indian country that would be affected.
    In all cases, the proposed rule requires the reviewing authority to 
mail a copy of the notice to you, the appropriate Indian governing 
body, and the tribal, State, and local air pollution authorities having 
jurisdiction in areas outside of the area of Indian country potentially 
impacted by your source. The proposed rule lists optional approaches 
that the reviewing authority may elect to use to provide public notice 
as appropriate for a given situation, depending on such factors as the 
nature and size of your source, local air quality considerations, and 
the characteristics of the population in the affected area. The 
optional methods of notifying the public include the following:
    <bullet> Mailing or e-mailing a copy of the notice to persons on a 
mailing list developed by the reviewing authority consisting of those 
persons who have requested to be placed on such a mailing list.
    <bullet> Posting the notice on its Web site.
    <bullet> Publishing the notice in a newspaper of general 
circulation in the area affected by the source. Where possible, the 
notice may also be published in a tribal newspaper or newsletter. We do 
not believe that such a notice is appropriate for every single minor 
source permit application since this would require a heavy resource 
commitment for the reviewing authority, while not necessarily being as 
effective as some other measures.
    <bullet> Providing copies of the public notice for posting at 
locations in the area affected by your source. We expect that such 
locations might include Post Offices, libraries, tribal environmental 
offices, community centers, and other gathering places in the 
community.
    <bullet> Other appropriate means of notification.
    We believe that this combination of mandatory and optional 
approaches to providing notice is appropriate for today's proposed 
minor NSR program in Indian country. In addition, we believe that the 
proposal is consistent with 40 CFR 51.161, which requires a ``notice by 
prominent advertisement in the area affected,'' but does not specify a 
newspaper advertisement. We believe that in many areas of Indian 
country, notices posted in locations frequented by the local population 
and on agency Web sites, as well as mailed or e-mailed to concerned 
parties, will provide more ``prominent advertisement'' than would 
publication in a newspaper.
    The reviewing authority must provide for a 30-day public comment 
period on the draft permit. After considering all relevant public 
comments, the reviewing authority will make a final decision to issue 
or deny your permit. The public (including you, the permit applicant) 
will have an opportunity to appeal the final decision under 40 CFR 
49.159 of the proposed rule.
    These proposed public participation requirements would apply to 
preconstruction permits, minor source PAL permits, synthetic minor 
permits, and the initial issuance of general permits. We seek comment 
on the proposed public participation requirements in 40 CFR 49.157.
    We are also proposing very similar public participation 
requirements for the nonattainment major NSR program. See section 
IV.B.3 of this preamble.
12. What are the monitoring, recordkeeping, and reporting requirements?
    Sections 110(a)(2)(A) and (C) of the Act require that a 
preconstruction permitting program provide for the enforcement of 
measures that include ``enforceable emission limitations'' and other 
control measures, means, or techniques * * * as well as schedules and 
timetables for compliance.'' Section 110(a)(2)(F) additionally requires 
that a permitting program may require ``the installation, maintenance, 
and replacement of equipment, and the implementation of other necessary 
steps by owners and operators of stationary sources to monitor 
emissions from such sources,'' as well as ``periodic reports on the 
nature and amounts of emissions and emission-related data from such 
sources.''
    Generally, we are proposing that all permits issued under this 
minor NSR program contain emission limitations that are enforceable as 
a practical matter, as well as adequate monitoring, recordkeeping, and 
reporting requirements as may be necessary to assure compliance with 
those limitations. The requirements for monitoring, recordkeeping, and 
reporting are discussed below; See 40 CFR 49.155(a) of the proposed 
rule for the complete requirements.
    Monitoring requirements. The permit must include monitoring 
requirements sufficient to assure compliance with any control 
technology requirements contained in the permit. Monitoring

[[Page 48716]]

approaches may include continuous emissions monitoring systems (CEMS), 
predictive emissions monitoring systems (PEMS), continuous parameter 
monitoring systems (CPMS), periodic manual logging of monitor readings, 
equipment inspections, mass balances, periodic performance tests, and/
or emission factors, as appropriate for your minor source based on the 
types of emissions units, magnitude of emissions, and air quality 
considerations. Such monitoring shall assure use of terms, test 
methods, units, and averaging periods consistent with the control 
technology and emission limitations required for your source. If the 
permit includes a minor source PAL for a pollutant at your minor 
stationary source, it must also include monitoring to determine the 
actual emissions from your source for each month and the total actual 
emissions for each 12-month period, rolled monthly, for that pollutant.
    Recordkeeping requirements. The permit must include recordkeeping 
requirements sufficient to assure compliance with the enforceable 
emission limitations in your permit. Records of required monitoring 
information must include all calculations using emissions factors, all 
stack tests or sampling information including date and time of test or 
sampling, the name of the company or entity that performed the 
analyses, the analytical techniques or methods used, the results of 
such analyses and the operating conditions existing at the time of 
sampling or measurement. All such records including support information 
must be retained for 5 years from the date of the record. Support 
information may include all calibration and maintenance records and all 
original strip-chart recordings or electronic records for continuous 
monitoring instrumentation.
    Reporting requirements. You must provide annual monitoring reports 
showing whether you have complied with your permit emission 
limitations. You also must provide prompt reports of deviations from 
permit requirements, including those attributable to upset conditions 
as defined in the permit, the probable cause of such deviations, and 
any corrective actions or preventive measures taken. Within a permit, 
the reviewing authority must define ``prompt'' in relation to the 
degree and type of deviation likely to occur.
13. What are the criteria for general permits, what source categories 
generally qualify for them, and what are the permit application 
requirements for a general permit?
    A ``general permit'' is a preconstruction permit that may be 
applied to a number of similar emissions units or stationary sources. 
The purpose of a general permit is to simplify the permit application 
and issuance process for similar facilities so that a reviewing 
authority's limited resources need not be expended for case-by-case 
permit development for such facilities. A general permit may be written 
to address a single emissions unit, a group of the same type of 
emissions units, or an entire minor source.
    The minor NSR program proposed in this action would allow your 
reviewing authority to issue general permits for categories of 
emissions units or stationary sources that are similar in nature, have 
substantially similar emissions, and would be subject to the same or 
substantially similar permit requirements. ``Similar in nature'' refers 
to size, processes, and operating conditions. To issue a general 
permit, the reviewing authority must provide the same opportunities for 
public participation and administrative and judicial review that apply 
to minor NSR permits issued to a specific source under this program. 
This is true with respect to all aspects of the general permit except 
its applicability to an individual source. See proposed 40 CFR 
49.156(b).
    Once a general permit has been issued for a source category or 
category of emissions units, you may submit an application to be 
covered under the general permit if your proposed new minor source or 
modification qualifies for coverage under that general permit. Your 
reviewing authority may grant or deny your request to construct under a 
general permit without further public participation. However, when you 
receive approval to be covered under a general permit, you must post a 
prominent notice at your source of this approval to construct under the 
general permit. Someone may seek judicial review only on the issue of 
whether your source qualifies for the general permit. See proposed 40 
CFR 49.156(e). We believe that general permits offer a cost-effective 
means of issuing permits and provide a quicker and simpler alternative 
mechanism for permitting your minor sources than the site-specific 
permitting process discussed previously.
    In setting criteria for sources to be covered by general permits, 
your reviewing authority would consider the following factors. First, 
categories of sources or emissions units covered by a general permit 
should be generally homogeneous in terms of operations, processes, and 
emissions. All sources or emissions units in the category should have 
essentially similar operations or processes and emit pollutants with 
similar characteristics. Second, the sources or emissions units should 
be expected to warrant the same or substantially similar permit 
requirements governing operation, emissions, monitoring, recordkeeping, 
or reporting.
    Your sources covered under a general permit would be issued a 
letter approving coverage under the general permit. You must maintain 
the general permit and the letter at your source location at all times 
to be made available for inspection by the reviewing authority.
    General permits may be issued to cover any category of numerous 
similar sources, provided that such sources meet the appropriate 
criteria. For example, permits can be issued to cover small businesses 
such as gas stations or dry cleaners. General permits may also, in some 
circumstances, be issued to cover discrete emissions units, such as 
individual solvent cleaning machines at industrial complexes. We 
request comment on the use of general permits, eligible emissions units 
and source categories, and the process of issuing general permits.
14. What is the administrative and judicial review process proposed for 
this program?
    We are proposing and seeking comment on two options for reviewing 
initial permit decisions by reviewing authorities under this program. 
We will discuss these options further, but first we will present the 
proposed administrative procedures that we expect to be the same 
regardless of which review option we ultimately select.
    The final permit issuance procedures and related notice 
requirements are proposed in 40 CFR 49.159(a). After decision on a 
permit, the reviewing authority must notify you of the decision, in 
writing, and if the permit is denied, of the reasons for the denial. If 
the reviewing authority issues a final permit to you, it must make a 
copy of the permit available at all of the locations where the draft 
permit was made available. In addition, the reviewing authority must 
provide adequate public notice of the final

[[Page 48717]]

permit decision to ensure that the affected community, general public, 
and any individuals who commented on the draft permit have reasonable 
access to the decision and supporting materials. Depending on the 
circumstances of your permit, the reviewing authority may elect to 
provide notice directly to the individuals who commented on the draft 
permit and/or use any of the other methods of public notice discussed 
in section IV.A.11 of this preamble (related to public notice of the 
draft permit).
    We are proposing a requirement that the reviewing authority's final 
decision on your permit be based on an administrative record and 
requirements on what must be in that record. See proposed 40 CFR 
49.159(b) and (c). The proposed rules also include provisions at 40 CFR 
49.159(e) that address reopening a permit after it has been issued if 
it contains a material mistake or fails to assure compliance with the 
permit requirements. In addition, proposed 40 CFR 49.159(f) contains 
provisions for administrative permit revisions to make minor changes in 
the permit without being subject to the permit application, issuance, 
public participation, or administrative and judicial review 
requirements of the program.
    We are proposing two options for reviewing initial permit decisions 
by reviewing authorities. In Option 1, review of minor NSR permits 
would be similar to review of major PSD permits issued under 40 CFR 
52.21. To challenge the terms of your permit, you or another party 
would have to file a petition for review with our Environmental Appeals 
Board (EAB). Decisions by the EAB could be appealed to the Federal 
Court of Appeals for the tribal area. Alternatively, in Option 2, the 
reviewing authority's initial permit could be appealed directly to the 
appropriate Federal Court of Appeals without a requirement to appeal to 
the EAB first. There are advantages and disadvantages to both 
approaches. We solicit comment on which option we should adopt.
    Option 1. Under Option 1, the proposed administrative and judicial 
review process for the minor NSR program parallels the process for PSD 
permits issued under 40 CFR 52.21, which is found in 40 CFR part 124. 
Since not all of the provisions of part 124 need to apply to this 
program, rather than adding the minor NSR program to the list of 
programs to which part 124 applies, in this option we are proposing to 
include the desired provisions in 40 CFR 49.159. The proposed 
provisions are very similar to the part 124 provisions, although they 
have been modified to better suit the small sources that will be 
covered under the minor NSR program.
    The major difference between Option 1 and Option 2 is that, under 
Option 1, permit decisions may be appealed to the EAB within 30 days 
after a final permit decision has been issued, and a final permit 
typically would not become effective until 30 days after issuance. Upon 
filing of a petition for review, the permit would be stayed (i.e., not 
go into effect) until the EAB decides whether to review any condition 
of the permit and the reviewing authority takes any action required by 
the EAB. When the EAB has issued its final order on an appeal, a motion 
to reconsider the final order may be filed with the EAB within 10 days. 
Only after all administrative remedies under proposed 40 CFR 49.159 
have been exhausted could the person(s) filing the petition seek 
judicial review.
    Option 2. Option 2 has two major differences from the appeals 
process we proposed in Option 1. First, we propose under Option 2 that 
permits would become immediately effective upon issuance by the 
reviewing authority unless a later effective date is specified. Second, 
there is no requirement for seeking EAB review before filing a petition 
for review in the Federal Court of Appeals with jurisdiction of the 
tribal area. The final agency action for purposes of judicial review is 
the issuance of the final permit by the reviewing authority. The permit 
is not stayed by the filing of a petition for review. If a party 
challenging a permit would like to have your permit stayed, that party 
may seek a stay under the provisions of the Administrative Procedures 
Act (APA), 5 U.S.C. 705.
    Because the regulatory language for Option 1 is more detailed than 
would be required for Option 2, the proposed regulatory text only 
addresses Option 1.
    Advantages and Disadvantages of Options 1 and 2. The different 
approaches to appeals of reviewing authority decisions result from 
section 704 of the APA. This section provides that an agency action 
that is otherwise final is final for purposes of judicial review unless 
the agency otherwise requires by rule that a party must seek review by 
a superior authority within the agency and the agency's action is 
meanwhile inoperative. Therefore, if we were to require administrative 
review by the EAB or another part of EPA before allowing anyone to seek 
judicial review of a permit, then we would be required to stay the 
permit for the duration of the appeal. The two options balance the 
advantages of EAB review of permits with the desire to not 
unnecessarily and inappropriately delay your ability to construct or 
modify a new minor source.
    On the one hand, minor NSR permits are for sources and 
modifications that emit less than new major sources and major 
modifications to major sources. An automatic stay would delay these 
smaller projects from going ahead when there is less environmentally at 
stake than in a challenge to a PSD or nonattainment major NSR permit. 
In those instances where there would be irreparable harm caused by a 
project proceeding under a flawed permit, there would still be 
available the opportunity to seek a stay under the APA.
    On the other hand, review of permit decisions by the EAB serves as 
quality control over decisions by various parts of EPA. The EAB can 
ensure that the policies of the Administrator are applied consistently 
and appropriately in permit decisions. This may be important when a 
tribe receiving a delegation under this rule or an EPA Regional Office 
acting as the reviewing authority makes an error in applying the 
relevant rules.
    One important consideration would be the timeliness of any review 
process. The EAB has specialized expertise in environmental issues, 
unlike courts with broader case-loads. The EAB is likely to process a 
petition for review faster than a Court of Appeals. Courts of Appeals 
necessarily give priority criminal appeals over civil regulatory 
matters and thus may delay addressing and resolving permit appeals. In 
either the EAB or the Courts of Appeals, it is unlikely that review of 
minor NSR permits will be expedited ahead of matters with greater 
environmental impact.
    Under Option 2, you may be placed in a difficult situation of 
having a permit revoked after proceeding with construction while an 
appeal was pending. However, under Option 1, your project cannot 
proceed so long as the EAB appeal is pending.
    We seek comment on how to balance these issues. Which option do you 
prefer and why? We invite comment on whether either Option 1 or Option 
2 is more appropriate for general permits than individual minor source 
permits. We also ask for comment on whether there should be a short 
delay of 30 days before a permit is effective under Option 1 in order 
to allow for parties to seek administrative stays during 
reconsideration or to obtain a judicial stay before a permit goes into 
effect. Should we establish a mechanism for administrative 
reconsideration though the EAB, even when a party is seeking judicial 
review in the Court of Appeals? Any input on these issues with

[[Page 48718]]

supporting documentation will help us in structuring the final rule.

B. Major NSR Program in Nonattainment Areas of Indian Country

    In today's rulemaking, we are proposing to establish a major NSR 
program for new major stationary sources and major modifications at 
existing major stationary sources in nonattainment areas of Indian 
country at 40 CFR 49.166 through 49.175. This program is designed to 
meet the requirements of part D of title I of the Act, and sources 
subject to this program would be required to comply with the 
requirements of 40 CFR part 51, appendix S (appendix S).
    Appendix S is entitled ``Emission Offset Interpretative Ruling'' 
and sets forth preconstruction review requirements for major stationary 
sources and modifications locating in nonattainment areas where the 
State does not have an EPA-approved nonattainment major NSR program. In 
general, appendix S is a transitional nonattainment major NSR program 
that covers the period after an area has been newly designated as 
nonattainment, up until the State has amended its SIP's nonattainment 
major NSR program, as needed, to address the new nonattainment area. 
The requirements under appendix S are essentially the same as our 
requirements for State nonattainment major NSR programs at 40 CFR 
51.165.
    Primarily, we believe it is appropriate to apply appendix S 
provisions in Indian country for administrative convenience. 
Additionally, since appendix S generally applies in nonattainment areas 
where there is no approved nonattainment major NSR program, and since 
no tribe currently has such a program, we believe that appendix S 
should also apply in Indian country. Another reason for requiring 
sources subject to this program to comply with appendix S requirements 
is that the EPA Regional Offices (which will be implementing the 
program until an EPA-approved implementation plan is in place) and 
several major sources in Indian country are familiar with the 
implementation and provisions of appendix S.
    We considered and rejected the option of amending appendix S to 
extend its application to Indian country, since we believe that sources 
in Indian country are more likely to look for regulations applicable to 
them under part 49, which is solely dedicated to regulations that apply 
in Indian country. We also considered drafting a parallel major NSR 
regulation to apply to sources in Indian country, but rejected this 
option since it would essentially re-propose appendix S provisions, 
which have been in effect outside of Indian country for many years. We 
wanted to avoid any potential confusion or possible perception that 
these parallel regulation requirements would be different than the 
appendix S requirements.
    It is important to keep in mind that, in this rulemaking, we are 
only seeking comment on our general approach of requiring sources 
subject to the major NSR program in Indian country to be subject to the 
provisions of appendix S. While we will consider any compelling 
rationale or justification from a commenter that a particular provision 
in appendix S is not appropriate for Indian country, we will not 
entertain general comments on the appendix S provisions, since this 
transitional program has been implemented in States across the country 
for many years.
1. What are the requirements for major source permitting under appendix 
S?
    Pursuant to paragraph IV of appendix S, a reviewing authority may 
issue a permit for a new major source or a major modification locating 
in a nonattainment area, if it complies with the following conditions:
    <bullet> The new major source or a major modification meets the 
LAER for that source utilizing add-on controls or pollution prevention 
measures.
    <bullet> The applicant certifies that all existing major sources 
owned or operated by the applicant (or any entity controlling, 
controlled by, or under common control with the applicant) in the same 
State as the proposed source are in compliance with (or under a 
federally-enforceable compliance schedule for) all applicable emission 
limitations and standards under the Act.
    <bullet> Emission reductions (offsets) from existing sources in the 
area of the proposed source (whether or not under the same ownership) 
are obtained such that there will be reasonable progress towards 
attainment of the applicable NAAQS. Only intrapollutant emission 
offsets will be acceptable (e.g., NOx for NOx).
    <bullet> The emission offsets provide a net air quality benefit in 
the affected area.
2. What are the options we are proposing to address the lack of 
available offsets in Indian country?
    Tribal representatives have repeatedly stated that requirements for 
emission offsets are problematic in Indian country for the following 
reasons. Many tribes believe that transport is a major cause of 
pollution in Indian country. Tribes, with few exceptions, do not have 
many existing sources within their area of Indian country from which 
offsets can be obtained. In addition, administrative barriers may 
hinder tribal access to otherwise available offsets. Therefore, tribal 
representatives have advocated for additional flexibility to address 
offsets, such as the provision of NSR offset set-asides (which we 
expect would come from State offset pools or banks). Tribal 
representatives have raised these and other concerns in discussions on 
implementation of the 8-hour ozone and PM<INF>2.5</INF> standards, and 
in comments on the 8-hour ozone implementation rule.\8\
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    \8\ For example, see the letter from Bill Grantham, National 
Tribal Envrionmental Council, to docket EPA-HQ-OAR-2003-0076, 
providing comments on the proposed 8-hour ozone implementation rule 
(66 FR 32802).
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    We recognize the unique circumstances that tribes face. Unlike 
States that have a SIP, a huge industrial base with several hundred 
existing sources, and a broad range of measures to attain and maintain 
NAAQS, a tribe generally has neither a TIP nor many existing sources 
from which to generate offsets. Under these circumstances, we are 
proposing two options to address the lack of availability of offsets 
for tribes: (1) The Economic Development Zone (EDZ) option and (2) the 
appendix S, paragraph VI option. We also are requesting comment on 
other potential options for offset relief in Indian country.
    Economic Development Zone Option. We would rely on section 
173(a)(1)(B) of the Act wherein the Administrator, in consultation with 
the Secretary of Housing and Urban Development (HUD), would identify 
areas in Indian country as EDZs such that sources subject to major NSR 
located in EDZs in Indian country would be exempt from the offset 
requirement in section 173(a)(1)(A) of the Act.
    Section 173(a)(1) of the Act provides for the issuance of permits 
to construct and operate a new or modified major stationary source if 
the reviewing authority determines that (A) ``* * * sufficient 
offsetting emissions reductions have been obtained * * *'' or (B) ``in 
the case of a new or modified major stationary source which is located 
in a zone (within the nonattainment area) identified by the 
Administrator, in consultation with the Secretary of Housing and Urban 
Development, as a zone to which economic development should be 
targeted, that emissions of such pollutant resulting from the proposed 
new or modified major stationary source will not cause or contribute to 
emissions levels which

[[Page 48719]]

exceed the allowance permitted for such pollutant for such area from 
new or modified major stationary sources under section 172(c).''
    Once the Administrator has identified an area that should be 
targeted for economic development in consultation with HUD, major 
sources that construct or modify within that area are relieved of the 
offset requirement if the State/tribe can demonstrate that the new 
permitted emissions are consistent with the achievement of reasonable 
further progress pursuant to section 172(c)(4) of the Act, and will not 
interfere with attainment of the applicable NAAQS by the applicable 
attainment date.
    We understand that HUD's Initiative for Renewal Communities, Urban 
Empowerment Zones, and Urban Enterprise Communities generally require 
that participating communities demonstrate pervasive poverty, high 
unemployment, and general distress throughout the designated area. The 
U.S. Department of Agriculture requires similar eligibility criteria 
for participating communities located in rural areas. We believe that 
many areas of Indian country may meet these criteria and hence could 
qualify for this offset relief provision. We seek comment on whether 
these criteria are appropriate for use in identifying EDZs in Indian 
country and if we should consider any other criteria.
    We are also proposing to have the Administrator consult with HUD 
only once to develop a general set of approval criteria, such that a 
consultation is not required every time a tribe applies for its area of 
Indian country to be designated as an EDZ. EPA would provide assistance 
as needed for a tribe to complete an EDZ designation request. Once the 
Administrator approves such a request from a tribe, a new major source 
or a major modification locating in that EDZ would be exempt from the 
offset provisions. We seek comment on this approach for providing 
offset relief.
    Appendix S, Paragraph VI Option. Paragraph VI of appendix S notes 
that in some cases, the dates for attainment of the primary or 
secondary NAAQS may not have passed. In such cases, appendix S provides 
that a new source locating in a nonattainment area may be exempt from 
the requirements of paragraph IV.A of appendix S (discussed in section 
IV.B.1 of this preamble), including the offset requirement, if the 
following conditions are met:
    <bullet> The new source complies with the applicable implementation 
plan emission limitations;
    <bullet> The new source will not interfere with the attainment date 
for a regulated NSR pollutant; and
    <bullet> We have determined that the preceding two conditions are 
satisfied and such determination is published in the Federal Register.
    Tribes would be able to use this option for offset relief for the 
8-hour ozone and PM2.5 NAAQS. For instance, the attainment dates for 8-
hour ozone nonattainment areas range from 2007 for marginal areas to 
2021 for severe areas. Hence, a new major source or a major 
modification locating in such a nonattainment area prior to the 
attainment date may be exempt from the requirements of paragraph IV of 
appendix S, if the associated conditions are met.
    It is important to note that this option would provide only 
temporary offset relief because it would cease to be available once the 
attainment date for a pollutant has passed. For instance, this option 
would not be available to marginal 8-hr ozone nonattainment areas after 
2007. We seek comment on this paragraph VI option for offset relief.
    We are seeking comment on other potential options for addressing 
the lack of availability of offsets in Indian country.
3. What are the proposed public participation requirements for this 
program?
    We believe that the public participation requirements of 40 CFR 
51.161 apply to permitting under appendix S. Additionally, for the 
nonattainment major NSR program, we are proposing detailed public 
notice requirements at 40 CFR 49.171. The proposed requirements for the 
nonattainment major NSR program are very similar to those proposed for 
the minor NSR program at 40 CFR 49.157. See section IV.A.11 for more 
information on the proposed requirements.
4. How do I meet the statewide compliance certification requirement of 
the Act?
    Pursuant to the statewide compliance certification requirements of 
section 173(a)(3) of the Act, an owner or operator of a proposed new or 
modified major stationary source must demonstrate that all other major 
stationary sources under her/his control in the same State are in 
compliance or on a schedule for compliance with all emission 
limitations and standards of the Act. It is important to recognize that 
the proposed rules will not impact this statewide compliance 
certification requirement. However, in the context of Indian country, 
we are seeking comments on whether this requirement should be expressed 
as an Indian country-wide compliance certification or remain a 
statewide certification. In other words, should you be required to 
certify that all your sources in the State where your proposed source 
is locating are in compliance, or that all your sources in all of 
Indian country are in compliance?
    Note that we are proposing a minor change to appendix S that is 
related to the ``emission limitations and standards of the Act.'' 
Existing paragraph II.B of appendix S requires the reviewing authority 
to review each proposed new major source and major modification to 
determine whether it will meet ``any applicable new source performance 
standard in 40 CFR part 60, or any national emission standard for 
hazardous air pollutants in 40 CFR part 61.'' While we have 
incorporated this requirement into proposed 40 CFR 49.169(a), we 
believe that it should be expanded to include the newer national 
emission standards for hazardous air pollutants codified at 40 CFR part 
63 (commonly referred to as MACT standards). Accordingly, we are 
proposing to revise paragraph II.B of appendix S to add these standards 
under the Act, and proposed 40 CFR 49.169(a) would match the revised 
language of this paragraph.

V. Legal Basis, Statutory Authority, and Jurisdictional Issues

A. What is the basis for our authority to implement these programs?

    Today's proposed rules are intended to fill a regulatory gap in the 
protection of air quality in Indian country. Although many States have 
developed regulatory programs for minor sources, those programs do not 
apply in Indian country unless explicitly approved by EPA for such 
areas. In addition, there is no Federal minor NSR program or major 
nonattainment NSR program in Indian country. Part D of title I of the 
Act requires that each SIP include preconstruction review and 
permitting rules for the construction and operation of new and modified 
major stationary sources located in designated nonattainment areas. The 
TAR authorizes eligible Indian tribes to implement EPA-approved 
nonattainment NSR (part D of title I of the Act), PSD (part C of title 
I of the Act), and other programs under the Act in the same manner as 
States. However, if Indian tribes are unable, or choose not, to develop 
a nonattainment NSR program in a TIP, we will implement the program 
where necessary or

[[Page 48720]]

appropriate. Today's proposed requirements are intended to provide the 
mechanism for implementation of the Federal major nonattainment NSR and 
minor NSR programs in Indian country.
    The purpose of the proposed rules is to ensure that the NSR program 
is implemented throughout the United States and that any economic 
growth occurring in Indian country will do so in harmony with the 
preservation of existing clean air resources. Today's proposed rules 
provide both Indian tribes and businesses operating or considering 
locating in Indian country an understanding of the NSR programs for 
stationary sources. They also provide businesses and tribes procedures 
to comply with the major nonattainment NSR and minor NSR programs.
    The Act gives us the authority to protect the Nation's air 
resources. Furthermore, title I of the Act requires that the NSR 
program be established to protect public health and welfare, national 
parks, and wilderness areas as new sources of pollution are built or 
existing sources are modified. The program is designed to ensure that 
emissions will be well controlled and that there will be protection of 
the NAAQS in Indian country. We understand that not all tribes have the 
resources to design and implement NSR programs; therefore, in today's 
proposal, we are providing a Federal program to apply in Indian country 
and that tribes may use as a model if they choose to develop their own 
implementation programs and obtain our approval.
    Under today's proposed rule, the Federal program at 40 CFR 49.151 
through 49.165 for minor stationary sources would apply throughout 
Indian country, except where we explicitly approve an implementation 
plan for such programs. The Federal rule at 40 CFR 49.166 through 
49.175 for new and modified major stationary sources in nonattainment 
areas located in Indian country would likewise apply in an area of 
Indian country until an implementation plan has been approved by us.
    As discussed previously, the Act provides us with broad authority 
to protect air resources throughout the Nation, including air resources 
in Indian country. See, for example, the preamble discussion for the 
proposed and final TAR (59 FR 43956, 43958-61, August 25, 1994; 63 FR 
7254, 7262-64, February 12, 1998) and the preamble discussion for the 
proposed revisions to the part 71 Federal operating permits program for 
Indian country (62 FR 13748, 13750, March 21, 1997). In the preambles 
to the proposed and final TAR, we discussed generally the legal basis 
under the Act for EPA and tribal regulation of sources of air pollution 
in Indian country. We concluded that the Act constitutes a statutory 
delegation of Federal authority to eligible tribes over all sources of 
air pollution within the exterior boundaries of their reservations.
    Further, under the Act, tribes may also apply to administer tribal 
air quality programs for non-reservation areas over which they can show 
jurisdiction.\9\ See 63 FR 7254-7259, 59 FR 43958-43960, Arizona Public 
Service Co. v. EPA, 211 F.3d 1280 (D.C. Cir. 2000), cert. den., 532 
U.S. 970 (2001).
---------------------------------------------------------------------------

    \9\ We believe that in the context of programs under the Act, 
States generally lack the authority to regulate air quality in 
Indian country. See Alaska v. Native Village of Venetie Tribal 
Government, 522 U.S. 520, 527 fn. 1 (1998) (``Generally speaking, 
primary jurisdiction over land that is Indian country rests with the 
Federal Government and the Indian tribe inhabiting it, and not with 
the States.''), California v. Cabazon Band of Mission Indians, 480 
U.S. 202 (1987), and HRI v. EPA, 198 F.3d 1224 (10th Cir. 2000); see 
also discussion in EPA's final rule for the Federal operating 
permits program (64 FR 8251-8255, February 19, 1999). To provide 
additional certainty to regulated entities, we believe it is helpful 
to clarify the extent to which State NSR programs have force in 
Indian country. We make clear today that we interpret past approvals 
and delegations of NSR programs as not extending to Indian country 
unless the State has made an explicit demonstration of jurisdiction 
over Indian country, and we have explicitly approved or delegated 
the State's program for such area. This is consistent with Congress' 
requirement that we approve State and tribal programs only where 
there is a demonstration of adequate authority. See sections 
110(a)(2)(E), 110(o), and 301(d) of the Act and 40 CFR part 49. 
Since States generally lack the authority to regulate air resources 
in Indian country, we do not believe it would be appropriate for us 
to approve State programs under the Act as covering Indian country 
where there has not been an explicit demonstration of adequate 
jurisdiction and where we have not explicitly indicated our intent 
to approve the State program for an area of Indian country. In State 
NSR program approvals and delegations, we generally were not faced 
with State assertions of authority to regulate sources in Indian 
country. However, to the extent States or others may have 
interpreted our past approvals or delegations that were not based on 
explicit demonstrations of adequate authority and did not explicitly 
grant approval in Indian country, as approvals to operate NSR 
programs in Indian country, we wish to clarify any such 
misunderstanding.
---------------------------------------------------------------------------

    In the preamble to the TAR, we also concluded that the Act 
authorizes us to protect air quality throughout Indian country. See 63 
FR 7262, 59 FR 43960-43961 citing sections 101(b)(1), 301(a), and 
301(d) of the Act.
    In addition, sections 301(d) and 110(o) of the Act give the tribes 
the authority to develop their own tribal programs. We encourage 
eligible tribes to develop their own minor and major nonattainment NSR 
programs for incorporation into their TIPs. In the absence of EPA-
approved programs, we believe that, in most cases, it would be neither 
practical nor administratively feasible for us to develop and implement 
a separate program for each area of Indian country. As a result, we are 
proposing to implement a flexible FIP for Indian country that provides 
new and modified minor sources and major sources in nonattainment areas 
with procedures to demonstrate that they will be operating in a manner 
that is protective of air resources and the NAAQS.
    Section 301(a) of the Act provides us broad authority to issue such 
regulations as are necessary to carry out the mandates of the Act. 
Further, several provisions of the Act call for Federal implementation 
of a program where, for example, a State, or in this case a tribe, 
fails to adopt a program or adopts an inadequate program. See, for 
example, sections 110(c)(1), 502(d)(3), and 502(i)(4) of the Act. These 
provisions exist in part to ensure that the benefits of the Act would 
be realized throughout the United States, whether or not local 
governments choose to participate in implementing the Act. Especially 
in light of the problems associated with transport of air pollution 
across State and tribal boundaries, it follows that Congress intended 
that we have the authority to operate a Federal program in the absence 
of an adequately implemented EPA-approved program. See, for example, 59 
FR 43958-61, August 25, 1994; 62 FR 13750, March 21, 1997; and 63 FR 
7262-64, February 12, 1998.
    This interpretation is most evident from Congress' grant of 
authority to the EPA under section 301(d)(4) of the Act. Section 
301(d)(4) authorizes the Administrator to directly administer 
provisions of the Act so as to achieve the appropriate purpose where 
tribal implementation of those provisions is inappropriate or 
administratively infeasible. We determined that it is inappropriate to 
subject tribes, among other things, to the mandatory submittal 
deadlines and to the related Federal oversight mechanisms in section 
110(c)(1) of the Act, which are triggered when we make a finding that 
States have failed to meet required deadlines or disapprove a plan 
submittal. See 40 CFR 49.4(d).
    By determining that tribes should not be treated similarly to 
States for purposes of the specific FIP obligation under section 
110(c)(1) of the Act, we are not relieved of the general obligation 
under the Act to ensure the protection of air quality throughout the 
Nation, including throughout Indian country. Rather, consistent with 
the provisions of sections 301(a) and 301(d)(4) of the Act, we 
expressed our intent to promulgate

[[Page 48721]]

without unreasonable delay a FIP (where necessary or appropriate) to 
protect air quality if tribal efforts do not result in adoption and 
approval of tribal plans or programs. See 63 FR 7265, 40 CFR 49.11.
    We propose to exercise our authority to administer the minor NSR 
permitting program and the nonattainment major NSR program in Indian 
country, which is generally the area over which a tribe may potentially 
receive approval of programs under the Act. As noted in the final TAR, 
we interpret the Act as establishing a territorial approach to 
implementation of the Act within Indian reservations by delegating to 
eligible tribes authority over all reservation sources without 
differentiating among the various categories of on-reservation lands 
(63 FR 7254-7258). In addition, the Act authorizes eligible tribes to 
implement tribal programs under the Act in non-reservation areas over 
which a tribe has jurisdiction, generally including all areas of Indian 
country (63 FR 7258-7259).
    Under section 301(d)(4) of the Act, Congress authorized the EPA to 
maintain the territorial approach by implementing the Act in Indian 
country in the absence of an EPA-approved program. We believe that 
Congress authorized us, consistent with our Indian policy, to avoid the 
checkerboarding of reservations based on land ownership by federally 
implementing the Act over all reservation sources in the absence of an 
EPA-approved tribal program. See S. Rep. No. 228, 101st Cong., 1st 
Sess. 79 (1989) (implementation of the Act to be in a manner consistent 
with EPA's Indian policy). In addition, section 301(d)(4) authorized us 
to implement the Act in non-reservation areas of Indian country in 
order to fill any gap in program coverage and to ensure an efficient 
and effective transition to EPA-approved programs.
    Our interpretation of section 301(d) of the Act as authorizing our 
implementation throughout Indian country is also supported by the 
legislative history. See S. Rep. No. 228, 101st Cong., 1st Sess. 80 
(1989) (noting that section 301(d) of the Act authorizes the EPA to 
implement provisions of the Act throughout ``Indian country'' when 
there is no approved tribal program); Id. at 80 (noting that criminal 
sanctions are to be levied by the EPA, ``consistent with the Federal 
government's general authority in Indian country''); Id. at 79 (the 
purpose of section 301(d) is to ``improve the environmental quality of 
the air within Indian country in a manner consistent with the EPA 
Indian Policy'').
    In order to further our commitment to use our authority under the 
Act to protect air quality throughout Indian country by directly 
implementing the Act's requirements, we are now exercising the 
rulemaking authority entrusted to us by Congress to directly implement 
the minor NSR permitting program and nonattainment major NSR permitting 
program throughout all areas of Indian country. See generally, Chevron 
USA, Inc. v. NRDC, 467 U.S. 837, 842-45 (1984).

B. How does a tribe receive delegation to assist EPA with 
administration of the Federal minor and major NSR rules?

    Section 301(a)(1) of the Act provides that the Administrator is 
authorized to prescribe such regulations as are necessary to carry out 
his or her functions under the Act. Pursuant to this authority, 
proposed 40 CFR 49.160 and 49.172 of the minor and major NSR rules, 
respectively, provide that partial administration of the Federal NSR 
programs may be delegated to a tribal agency that submits a request for 
delegation which includes the information set forth in the proposed 
sections.\10\ Any Federal requirements under these programs that are 
administered by the delegate tribal agency will be subject to 
enforcement by EPA under Federal law. Nothing in the proposed rules 
would require us to delegate administration of any aspect of the 
Federal program to a tribal agency.
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    \10\ This information includes identifying the specific rules 
and provisions and the area of Indian country for which the 
delegation is requested. In addition, tribal agencies seeking 
delegation must provide a statement by the tribe's legal counsel or 
equivalent official including a statement that the tribe is 
recognized by the Secretary of the Interior, a descriptive statement 
demonstrating that the tribe is currently carrying out substantial 
governmental duties and powers over a defined area (this statement 
should be consistent with the type of information described in 40 
CFR 49.7(a)(2), which relates to the separate process by which 
tribes apply to be treated in a similar manner as States for various 
purposes under the Act), a description of the laws of the tribe that 
provide adequate authority to administer the Federal rules and 
provisions for which the delegation is requested, and a descriptive 
statement demonstrating that the tribal agency has, or will have, 
the technical capability and adequate resources to administer the 
Federal rules and provisions for which the delegation is requested.
---------------------------------------------------------------------------

    As noted elsewhere, we have established a process in the TAR 
pursuant to section 301(d) of the Act for tribes to seek treatment in a 
similar manner as a State (TAS) for various provisions and programs of 
the Act. Under the procedures set forth in the TAR, tribes may seek to 
demonstrate eligibility for approval of tribal programs under the Act, 
including a tribal NSR program, under tribal law. The TAR allows tribes 
to seek approval for such programs covering their reservations or other 
areas within their jurisdiction. We recognize that some tribes may 
choose not to develop tribal NSR programs for submission to us for 
approval under the TAR, but that these tribes may still wish to assist 
us in implementing the Federal NSR program for their area of Indian 
country. By assisting us with administration of the Federal program, 
tribes remain appropriately involved in implementation of an important 
air quality program and may develop their own capacity to manage such 
programs in the future should they choose to do so. Proposed 40 CFR 
49.160 and 49.172 of the minor and major NSR rules, respectively, 
provide tribal governments the option of seeking delegation from us of 
the administration of the Federal NSR program, or aspects of the 
program, for their area of Indian country. Such administrative 
delegation is to be distinguished from the TAS process under the TAR 
whereby tribes seek approval to run programs under tribal law. Tribes 
would not need to seek TAS under the TAR in order to request delegation 
of administration of aspects of these Federal NSR programs. Tribes 
would, however, need to provide the relevant application information 
described in those sections. In addition, program functions delegated 
under proposed 40 CFR 49.160 or 49.172 would remain part of the 
relevant FIP administered under Federal law. The delegate tribal agency 
would simply assist EPA with administration of the program to the 
extent of the functions delegated.
    We have well-established processes for delegating our Federal 
authority to States for administering Federal rules under the Act, 
including conducting new source review under 40 CFR 52.21(u), and 
issuing Federal operating permits under 40 CFR 71.4(j) and 71.10. The 
process we would follow to delegate the administration of the Federal 
NSR program to a tribal agency is similar to the process we follow to 
delegate the administration of Federal programs to States. Prior to 
finalizing any delegation agreement with a tribal agency, we would 
consult with other Federal, State, tribal, or local governmental 
entities, or other governmental agencies in the area, as appropriate. 
Although sections 110(o) and 301(d) of the Act and the TAR authorize us 
to review and approve TIPs, neither the Act nor the regulations provide 
that approval of tribal programs under tribal law is the sole mechanism

[[Page 48722]]

available for tribal agencies to take on permitting responsibilities. 
Accordingly, we propose to exercise our discretion to delegate 
administration of the Federal NSR program to interested tribal agencies 
satisfying the requirements of proposed 40 CFR 49.160 and 49.172.
    The delegation of administration of the Federal NSR program to 
tribes proposed in these rules is to be distinguished from our 
interpretation that the Act constitutes a delegation of Federal 
authority from Congress to tribes over their reservations as described 
in the TAR. See 63 FR 7254-59. As described in the preamble to the TAR, 
it is our position that the TAS provision of the Act constitutes a 
statutory delegation of authority to eligible tribes over their 
reservations. As described earlier, the TAR established procedures for 
our approval of tribal eligibility applications to operate the programs 
of the Act under tribal law. Where we approve a tribal eligibility 
application and approve a tribal NSR program, the approved tribe will 
manage the program under tribal law, and the tribal program becomes 
federally enforceable. Among the required elements of a tribal 
eligibility application under the TAR is a demonstration of the tribe's 
authority, including appropriate enforcement authority, to regulate air 
quality for the areas to be covered by the program. For air resources 
within the exterior boundaries of a tribe's reservation, the tribe may 
rely on the Congressional delegation of Federal authority to operate 
approved tribal programs. Tribes may also attempt to demonstrate 
authority to operate the programs of the Act over other areas outside 
of their reservations, generally including non-reservation areas of 
Indian country.
    In contrast, the delegation approach proposed in these rules 
provides for us to delegate administration of the Federal program 
operating under Federal law to interested tribes that provide the 
information described in proposed 40 CFR 49.160(b)(1) and 49.172(b)(1). 
Since this program operates throughout Indian country under Federal 
authority, tribes would not need to demonstrate either Congressionally-
delegated authority over air resources within the exterior boundaries 
of their reservations or authority of non-reservation areas of Indian 
country. Instead, tribal agencies would assist us in implementing the 
Federal program by taking delegation of the administration of 
particular activities conducted under our authority in Indian country. 
Under proposed 40 CFR 49.160(b)(1)(iii)(C) and 49.172(b)(1)(iii)(C), 
tribes would only need to show that their laws provide adequate 
capacity and authority to carry out the delegated activities. For 
example, where a tribe seeks administrative delegation for permit 
issuing activities of the Federal program, the tribe may, among other 
things, need to show it has in place an appropriate agency with legal 
authority to review applications and issue permits on behalf of the 
delegate tribal government. For these administratively delegated 
programs, Federal program requirements will continue to be subject to 
enforcement by us, not the delegate tribal agency, under Federal law. 
Administrative appeals of permitting decisions would also continue to 
be made directly to the EAB under our administrative procedures with 
any subsequent judicial review to be conducted in Federal court. In the 
proposed rules we make it clear that we will not delegate enforcement 
or appeal components of the program to tribal agencies.
    In order to be delegated authority to administer the proposed rules 
for a particular area of Indian country, the authorized representative 
of a tribal agency must demonstrate that it has the authority and 
technical capability to carry out the provisions of the rules for which 
delegation is requested. When delegation is approved, a Partial 
Delegation of Administrative Authority Agreement between the 
Administrator and the tribal agency will set forth the terms and 
conditions of the delegation, and will also specify the rules and 
provisions that the tribal agency is authorized to implement. Once the 
delegation becomes effective, the tribal agency will have the authority 
under the Act, to the extent specified in the Agreement, to administer 
the rules in effect for the particular area of Indian country, and to 
act on behalf of the Administrator. The Federal requirements 
administered by the delegate tribal agency will be subject to 
enforcement by us under Federal law.
    When we have delegated administration of the portion of the Federal 
minor or major NSR program that includes receipt of permit application 
materials and preparation of draft permits, the delegate tribal agency 
must provide us a copy of each permit application (including any 
application for permit revision) and each draft permit.\11\ In any such 
delegation, we retain the authority to object to the issuance of any 
permit that we determine not to be in compliance with the requirements 
under the program or other requirements pursuant to regulations under 
the Act. For any such objections, we will outline the reasons for the 
objection in writing, and we will provide a copy of the written 
statement to the permit applicant. The delegate tribal agency may not 
issue a permit if we object to its issuance in writing. The delegate 
tribal agency may submit a revised draft permit to us in response to 
the objection. However, if it does not do so within 90 days, we will 
issue or deny the permit in accordance with the requirements of the 
Federal minor or major NSR program, as applicable.
---------------------------------------------------------------------------

    \11\ The proposed minor and major NSR programs provide that the 
delegate tribal agency may require the applicant to provide a copy 
of the permit application directly to us. In addition, with our 
consent, the delegate tribal agency may submit to us a permit 
application summary form and any relevant portion of the permit 
application.
---------------------------------------------------------------------------

C. What happens to permits previously issued by States to sources in 
Indian country?

    As discussed previously, section 301(d) of the Act recognizes the 
authority of eligible tribes to implement the Act throughout their 
reservations and other areas under their jurisdiction. Historically, 
sources in some areas of Indian country may have received permits from 
States operating EPA-approved programs. However, States generally lack 
jurisdiction under the Act over these facilities and generally were not 
authorized under the Act to issue such permits in Indian country. We 
also recognize that just as it required many years to develop State and 
Federal programs to cover lands subject to State jurisdiction, it will 
also require time to develop tribal and Federal programs to cover areas 
of Indian country.
    We have also mentioned before that we will ``promulgate without 
unreasonable delay such Federal implementation plan provisions as are 
necessary or appropriate to protect air quality, consistent with the 
provisions of sections 301(a) and 301(d)(4) [of the Act], if a tribe 
does not submit a tribal implementation plan. * * *'' See 40 CFR 
49.11(a). Today's proposed rulemaking would provide a mechanism to 
change State permits issued to major sources of regulated NSR 
pollutants in nonattainment areas of Indian country to Federal major 
NSR permits. If you own or operate a major stationary source with a 
State-issued nonattainment major NSR permit, you must apply to convert 
the permit to a Federal permit under this program within 1 year of the 
effective date of this program. In this case, you would not be subject 
to any additional requirements under this program. See proposed 40 CFR 
49.168(b).
    The requirements contained in these State-issued permits have been 
relied on for protection of attainment and

[[Page 48723]]

maintenance of air quality in these nonattainment areas. We believe 
that transforming the State permits in to Federal major NSR permits for 
major sources in Indian country is appropriate to protect air quality 
in Indian country, as the tribes take on the effort to develop and/or 
run their own programs.

VI. Statutory and Executive Order Reviews

A. Executive Order 12866: Regulatory Planning and Review

    Under Executive Order 12866, (58 FR 51735, October 4, 1993), we 
must determine whether the regulatory action is ``significant'' and 
therefore subject to Office of Management and Budget (OMB) review and 
the requirements of the Executive Order. The Executive Order defines a 
``significant regulatory action'' as one that is likely to result in a 
rule that may:
    (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 obligation 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.
    Pursuant to the terms of Executive Order 12866, it has been 
determined that this is a ``significant regulatory action''. We have 
submitted this action to OMB for review. Changes made in response to 
OMB suggestions or recommendations will be documented in the public 
record.

B. Paperwork Reduction Act

    The information collection requirements in the proposed amendments 
have been submitted for approval to OMB under the Paperwork Reduction 
Act, 44 U.S.C. 3501, et seq. The Information Collection Request (ICR) 
document prepared by EPA has been assigned OMB Control Number 2060-0003 
(EPA ICR No. 1230.13).
    Certain records and reports are necessary for the tribal agency (or 
the EPA Administrator in non-delegated areas), for example, to: (1) 
Confirm the compliance status of stationary sources, identify any 
stationary sources not subject to the standards, and identify 
stationary sources subject to the rules; and (2) ensure that the 
stationary source control requirements are being achieved. The 
information would be used by the EPA or tribal enforcement personnel to 
(1) Identify stationary sources subject to the rules, (2) ensure that 
appropriate control technology is being properly applied, and (3) 
ensure that the emission control devices are being properly operated 
and maintained on a continuous basis. Based on the reported 
information, the delegate tribes can decide which plants, records, or 
processes should be inspected.
    The major nonattainment NSR rule would have little impact on 
existing major stationary sources in Indian country because it would 
only affect such owners and operators if they propose a major 
modification; none are expected. The proposed rule would only result in 
an administrative change for new major sources in Indian country 
because, although the regulatory mechanism to issue permits is not yet 
available in the form of either a Federal nonattainment NSR rule or a 
TIP, we would be required to implement the program in Indian country, 
and would otherwise have to do source-specific FIP. As a result, there 
would no new or additional burden on industry.
    With regard to the minor source permitting rule, the average 
capital cost per facility for the one-time activities is $13,088 per 
source; annualized, this cost is $1,863 per year per source. The total 
of the various annualized and recurring costs is an average of $7,598 
per year per source. The annual reporting and record keeping cost 
burden is a total annualized capital/startup costs of $77,000, and 
total annual costs (operation and maintenance) of $235,000.
    Burden means the total time, effort, or financial resources 
expended by persons to generate, maintain, retain, or disclose or 
provide information to or for a Federal agency. This includes the time 
needed to review instructions; develop, acquire, install, and utilize 
technology and systems for the purposes of collecting, validating, and 
verifying information, processing and maintaining information, and 
disclosing and providing information; adjust the existing ways to 
comply with any previously applicable instructions and requirements; 
train personnel to be able to respond to a collection of information; 
search data sources; complete and review the collection of information; 
and transmit or otherwise disclose the information.
    An agency may not conduct or sponsor, and a person is not required 
to respond to, a collection of information unless it displays a 
currently valid OMB control number. The OMB control numbers for the 
EPA's rules are listed in 40 CFR part 9 and 48 CFR chapter 15.
    To comment on the Agency's need for this information, the accuracy 
of the provided burden estimates, and any suggested methods for 
minimizing respondent burden, including the use of automated collection 
techniques, EPA has established a public docket for this rule, which 
includes this ICR, under Docket ID number EPA-HQ-OAR-2003-0075. Submit 
any comments related to the ICR for this proposed rule to EPA and OMB. 
See ADDRESSES section at the beginning of this notice for where to 
submit comments to EPA. Send comments to OMB at the Office of 
Information and Regulatory Affairs, Office of Management and Budget, 
725 17th Street, NW., Washington, DC 20503, Attention: Desk Office for 
EPA. Since OMB is required to make a decision concerning the ICR 
between 30 and 60 days after August 21, 2006, a comment to OMB is best 
assured of having its full effect if OMB receives it by September 20, 
2006. The final rule will respond to any OMB or public comments on the 
information collection requirements contained in this proposal.

C. Regulatory Flexibility Act (RFA)

    The RFA generally requires an agency to prepare a regulatory 
flexibility analysis of any rule subject to notice and comment 
rulemaking requirements under the Administrative Procedure Act or any 
other statute 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 organizations, and small 
governmental jurisdictions.
    For purposes of assessing the impacts of today's proposed rule on 
small entities, ``small entity'' is defined as: (1) A small business as 
defined by the Small Business Administration's regulations at 13 CFR 
121.201; (2) a small governmental jurisdiction that is a government or 
a city, county, town, school district or special district with a 
population of less than 50,000; and (3) a small organization that is 
any not-for-profit enterprise which is independently owned and operated 
and is not dominant in its field. Today's proposed rule only 
potentially affects small businesses, not small governments or small 
organizations.
    The proposed rule potentially affects six types of stationary 
sources in Indian Country:
    <bullet> New and modified minor sources of regulated NSR 
pollutants;

[[Page 48724]]

    <bullet> Sources of regulated NSR pollutants choosing to accept 
enforceable emission limitations to avoid major source regulations 
(synthetic minors);
    <bullet> Sources of HAP choosing to accept enforceable emission 
limitations to avoid major source regulations (synthetic minors);
    <bullet> Minor modifications to major sources of regulated NSR 
pollutants;
    <bullet> New major sources of regulated NSR pollutants in 
nonattainment areas; and
    <bullet> Major modifications to major sources of regulated NSR 
pollutants in nonattainment areas.
    The second, third, fifth, and sixth types of sources are projected 
to incur no incremental costs or to experience cost savings due to the 
proposed rule. The rule results in only an administrative change for 
new major sources in nonattainment areas. In the absence of the 
proposed rule, there is no regulatory mechanism to issue permits. We 
would be required to implement the program in Indian country, and such 
new major sources would have to be permitted through a source-specific 
FIP. The proposed rule would provide a regulatory mechanism for 
permitting such sources; because the compliance requirements are 
expected to be unchanged by the proposed rule, no change in control 
costs is expected. Because the permitting process may be less uncertain 
under the proposed rule, new and modifying major sources could 
potentially experience cost savings compared to baseline conditions. 
Choosing to accept enforceable emission limitations (become a synthetic 
minor) is entirely optional; rational firms would only make this choice 
if it resulted in a cost savings. For these four types of sources, 
therefore, no adverse economic impacts are expected to any businesses, 
including small businesses.
    The screening assessment therefore focused on costs and impacts for 
new and modified minor sources and minor modifications at major 
sources. To analyze potential impacts to small companies owning such 
sources, we first estimated the number of new sources that would be 
sited in Indian country over the period 2004 through 2010, the time 
period selected for the analysis.\12\ Generally, data on minor sources 
in Indian country is very limited. We conducted an exhaustive search 
for information available from EPA databases, the Small Business 
Administration, and EPA Regional Offices. We also encouraged the tribes 
to participate in the rulemaking, and inquired whether tribes had any 
information on minor sources but no data were received. We concluded 
that the information in 11 tribal emissions inventories maintained by 
EPA/OAQPS provided the best characterization of the types of minor 
sources that currently exist and the types of new minor sources that 
might be sited in Indian country in the future. We collected data from 
the Economic Census (1997) on the number of establishments of each type 
in each State, and allocated the establishments to Indian country based 
on tribes' share of State income. Then, we projected the number of new 
minor sources of each type that would be created in Indian country by 
applying the estimated growth rate for American Indian/Alaska Native 
(AI/AN) population in each State to the estimated baseline number of 
sources in Indian country in the State. Over the period from 
promulgation (2004) through (2010), we estimate that 288 new minor 
sources will be created in Indian country. We used data from financial 
databases to compute the share of companies in each sector that are 
owned by small businesses (based on the Small Business Administration 
small business size definitions at 13 CFR part 121). Assuming that the 
same share of new minor sources will be owned by small businesses, we 
estimate that 164 new minor source facilities, owned by 143 small 
businesses, will be created in Indian country during the period. 
Additionally, we project that 112 modifications to existing minor 
sources will occur during the period 2004 through 2010. Of these, we 
estimate that 51 small businesses will own 62 existing minor sources 
undergoing modifications during the period.
---------------------------------------------------------------------------

    \12\ Based upon our evaluation of current Tribal emission 
inventories and the application of updated growth rates, we have 
determined that the analysis has not changed significantly to date; 
therefore, the May, 2003 analysis for the period 2004-2010 remains 
valid for the EIA, the associated ICR supporting statement and this 
RFA. This analysis will be updated for the final rulemaking.
---------------------------------------------------------------------------

    Finally, we estimate that one major source in Indian country will 
make a minor modification to its operations each year. Thus, we 
estimate that seven minor modifications to existing major sources will 
occur over the period 2004 to 2010. Of these, we estimate that 3 of 
these major sources will be owned by 3 small businesses.
    Table 3 below summarizes the estimated numbers of affected 
facilities and small businesses.

    Table 3.--Projected Number of Affected Small Businesses and Estimated Costs Incurred by Small Businesses
                                               [2004 through 2010]
----------------------------------------------------------------------------------------------------------------
                                                                                             Estimated costs
                                         Projected number of      Estimated number of       incurred by small
             Source type                sources owned by small      small businesses     businesses  ($ million)
                                              businesses                                           \a\
----------------------------------------------------------------------------------------------------------------
New Minor Sources....................                      164                      143                    $2.68
Modified Minor Sources...............                       62                       51                     0.97
Minor Modifications to Major Sources.                        3                        3                     0.02
                                      --------------------------------------------------------------------------
    Total............................                      229                      197                     3.62
----------------------------------------------------------------------------------------------------------------
\a\ Based on Year 2000 dollars.

    To conduct our screening analysis of impacts on small businesses, 
we compared the estimated costs of compliance for each type of source 
in each sector with typical small business sales in each sector.
    Based on the screening analysis of impacts on small entities, we 
certify that this action will not have a significant economic impact on 
a substantial number of small entities. Our analysis estimates that, of 
the projected 164 new minor source facilities owned by 143 small 
businesses, two (a natural gas compressor station and a landfill) will 
experience costs greater than 1 percent of sales and none will 
experience costs exceeding 3 percent of sales due to the proposed rule. 
Of the estimated 62 existing minor source facilities owned

[[Page 48725]]

by 51 small businesses projected to perform minor modifications that 
result in emissions increases greater than the minor NSR thresholds in 
Table 1, three may experience costs approximately equal to 1 percent of 
sales; none experience costs exceeding 3 percent of sales. The three 
major source facilities owned by small businesses projected to perform 
minor modifications during the period 2004 through 2010 will incur only 
the costs of obtaining a minor source permit, which represent a very 
small share of baseline company sales. Therefore, of these 229 
potentially affected facilities owned by an estimated 197 small 
businesses, only 5 are projected to incur costs exceeding 1 percent of 
company sales, and none is projected to incur costs greater than 3 
percent of company sales. Thus, the proposed rule will not impose a 
significant economic impact on a substantial number of small entities.

D. Unfunded Mandates Reform Act

    Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), Public 
Law 104-4, establishes requirements for Federal agencies to assess the 
effects of their regulatory actions on State, local, and tribal 
governments and the private sector. Under section 202 of the UMRA, we 
generally must prepare a written statement, including a cost-benefit 
analysis, for proposed and final rules with ``Federal mandates'' that 
may result in expenditures to State, local, and tribal governments, in 
aggregate, or to the private sector, of $100 million or more in any 1 
year. Before promulgating an EPA rule for which a written statement is 
needed, section 205 of the UMRA generally requires us to identify and 
consider a reasonable number of regulatory alternatives and adopt the 
least costly, most cost-effective, or least burdensome alternative that 
achieves the objectives of the rule. The provisions of section 205 do 
not apply when they are inconsistent with applicable law. Moreover, 
section 205 allows us to adopt an alternative other than the least-
costly, most cost-effective, or least-burdensome alternative if the 
Administrator publishes with the final rule an explanation why that 
alternative was not adopted. Before we establish any regulatory 
requirements that may significantly or uniquely affect small 
governments, including tribal governments, we must have developed under 
section 203 of the UMRA a small government agency plan. The plan must 
provide for notifying potentially affected small governments, enabling 
officials of affected small governments to have meaningful and timely 
input in the development of our regulatory proposals with significant 
Federal intergovernmental mandates, and informing, educating, and 
advising small governments on compliance with the regulatory 
requirements.
    We have determined that this proposed rule does not contain a 
Federal mandate that may result in expenditures of $100 million or more 
for State, local, and tribal governments, in the aggregate, or the 
private sector in any 1 year. The maximum total annual cost of this 
proposed rule for any 1 year has been estimated to be $312,000. Thus, 
today's proposed rule is not subject to the requirements of sections 
202 and 205 of the UMRA. In addition, we have determined that this 
proposed rule contains no regulatory requirements that might 
significantly or uniquely affect small governments because it contains 
no requirements that apply to such governments or impose obligations 
upon them. Therefore, today's proposed rule is not subject to the 
requirements of section 203 of the UMRA.
    The proposed rule does not require that any tribe accept delegation 
or develop their own permitting program; thus, it does not impose any 
burden on small tribes. We recognize, however, that some small tribes 
may choose to assist EPA with administration of the minor NSR program 
on their reservations. We thus analyzed the costs to small tribes if 
they did make this choice, using small tribes that have chosen to 
develop their own air programs as examples of the types of tribes that 
might choose to assist EPA with administration of the minor new source 
permitting program. We found that the cost per tribal member was less 
than $1 per year, and represented less than 0.01 percent of the per 
capita income of tribal members. Thus, if the costs of developing and 
implementing a permitting program for new minor sources were borne by 
the tribes' members, it would not be a significant burden to them.

E. Executive Order 13132: Federalism

    Executive Order 13132 (64 FR 43255, August 10, 1999), requires us 
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 section 6 of Executive Order 13132, we 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 we consult 
with State and local officials early in the process of developing the 
proposed regulation. We also may not issue a regulation that has 
federalism implications and that preempts State law, unless we consult 
with State and local officials early in the process of developing the 
proposed regulation.
    This proposed rule does not have federalism implications. It would 
not 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, 
as specified in Executive Order 13132. Pursuant to the terms of 
Executive Order 13132, it has been determined that this proposed rule 
does not have ``federalism implications'' because it does not meet the 
necessary criteria. Thus, the requirements of section 6 of the 
Executive Order do not apply to this proposed rule.
    In the spirit of Executive Order 13132, and consistent with our 
policy to promote communications between us and State and local 
governments, we specifically solicit comment on this proposed rule from 
State and local officials. We felt it was important to ensure that the 
State and local air pollution control agencies and small business 
concerns had an opportunity to interact with development of this rule. 
To that end, we had two meetings with the STAPPA/ALAPCO to present the 
draft preamble and rule. We also met with the National Federation of 
Independent Business and provided outreach material through the small 
business ombudsman's office to get input from the small businesses that 
might be affected by this rule.

F. Executive Order 13175: Consultation and Coordination With Indian 
Tribal Governments

    Executive Order 13175 (65 FR 67249, November 6, 2000), requires us 
to develop an accountable process to ensure ``meaningful and timely 
input by tribal officials in the development of regulatory policies 
that have tribal implications.''
    The EPA has concluded that this rule will have tribal implications, 
since it provides two preconstruction air permitting rules for 
stationary sources in Indian Country. These rules will be

[[Page 48726]]

implemented by EPA, or a delegate tribal agency assisting EPA with 
administration of the rules, until replaced by an EPA-approved tribal 
implementation plan. However, it will neither impose substantial direct 
compliance costs on tribal governments, nor preempt Tribal law.
    The EPA consulted with tribal officials early in the process of 
developing this regulation to permit them to have meaningful and timely 
input into its development. In undertaking this rulemaking effort we 
wanted to ensure that the tribes were included in the rulemaking 
process from the beginning of the rule development effort. On June 24, 
2002, we sent letters to tribal leaders seeking their input on how we 
could best consult with the tribes on the rulemaking effort.
    We received responses from 75 tribes. Of these 75 tribes, 69 
designated an environmental staff member to work with us on developing 
the rule. Aside from the staff designated to help with the rulemaking 
process, many tribal leaders wished to be kept informed of the rule 
development. Many of the tribal leaders indicated that they wished to 
be kept informed through e-mail, meetings with the EPA Regional 
Offices, newsletters, and Web sites. However, 53 percent of the tribal 
leaders also requested direct phone calls or conference calls to 
discuss the subject. Only 16 percent of the respondents requested face-
to-face consultation. Even among the tribes requesting face-to-face 
consultation, there was some degree of latitude, with only six tribes 
requesting senior EPA staff to meet with tribal leaders.
    As a result of this feedback we developed a consultation/outreach 
plan which included three meetings held at the reservations of the 
Menominee Tribe in Wisconsin, the Mohegan Tribe in Connecticut, and the 
Chehalis Tribe in Washington. A fourth meeting was held in conjunction 
with the Institute of Tribal Environmental Professionals' (ITEP) 
anniversary meeting in Flagstaff, Arizona. In addition to conducting 
these national meetings, we also visited tribal environmental staff on 
tribal lands, where time and travel permitted. Over 30 tribes attended 
these meetings. We have also provided outreach to the tribes in 
numerous national and regional forums including the National Tribal 
Forums put on by the Institute of Tribal Environmental Professionals, 
two National Tribal Air Association meetings, and at meetings with 
tribal consortia, such as the National Tribal Environmental Council, 
United Southern and Eastern Tribes, Inter Tribal Environmental Council, 
Inter Tribal Council of Arizona, and others.
    In addition to the meetings, we also have an ongoing workgroup of 
tribal environmental staff that has worked with us on developing these 
rules. We propose to continue with this consultation and outreach 
process until we promulgate this rulemaking package. EPA specifically 
solicits additional comment on this proposed rule from tribal 
officials.

G. Executive Order 13045: Protection of Children From Environmental 
Health & Safety Risks

    Executive Order 13045 (62 FR 19885, April 23, 1997) applies to any 
rule that: (1) Is determined to be ``economically significant'' as 
defined under Executive Order 12866, and (2) concerns an environmental 
health or safety risk that we have reason to believe may have a 
disproportionate effect on children. If the regulatory action meets 
both criteria, we 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 that we considered.
    We interpret Executive Order 13045 as applying only to those 
regulatory actions that are based on health or safety risks, such that 
the analysis required under section 5-501 of the Executive Order has 
the potential to influence the regulation. This proposed rule is not 
subject to Executive Order 13045 because it does not establish 
environmental standards based on an assessment of health or safety 
risks. Furthermore, this proposed rule has been determined not to be 
``economically significant'' as defined under Executive Order 12866.

H. Executive Order 13211: Actions That Significantly Affect Energy 
Supply, Distribution, or Use

    This proposed rule is not a ``significant energy action'' as 
defined in Executive Order 13211,``Actions Concerning Regulations that 
Significantly Affect Energy Supply, Distribution, or Use'' (66 FR 
28355, May 22, 2001) because it is not likely to have a significant 
adverse effect on the supply, distribution, or use of energy.

I. Executive Order 12898: Federal Actions To Address Environmental 
Justice in Minority Populations and Low-Income Populations

    Executive Order 12898 requires that each Federal agency make 
achieving environmental justice part of its mission by identifying and 
addressing, as appropriate, disproportionately high and adverse human 
health environmental effects of its programs, policies, and activities 
on minorities and low-income populations.
    The EPA believes that the two preconstruction air quality 
regulations proposed in this FIP should not raise any environmental 
justice issues. These regulations would provide regulatory certainty 
and fill a regulatory gap in Indian Country and result in emissions 
reductions from sources complying with these regulations. Consequently, 
the regulations should result in some health benefits to persons living 
in Indian Country, many of whom live in low-income and minority 
communities. Therefore, we believe that these regulations would not 
have a disproportionate adverse effect on the health or safety of 
minority or low income populations.

J. National Technology Transfer Advancement Act

    Section 12(d) of the National Technology Transfer and Advancement 
Act of 1995 (NTTAA), Public Law 104-113, 12(d) (15 U.S.C. 272 note) 
directs us to use voluntary consensus standards (VCS) in our regulatory 
and procurement activities unless to do so would be inconsistent with 
applicable law or otherwise impractical. The VCS are technical 
standards (e.g., materials specifications, test methods, sampling 
procedures, and business practices) developed or adopted by one or more 
voluntary consensus bodies. The NTTAA directs us to provide Congress, 
through annual reports to OMB, with explanations when we do not use 
available and applicable VCS.
    This proposed rule does not involve technical standards. Therefore, 
we are not considering the use of any voluntary consensus standards.

VII. Statutory Authority

    The statutory authority for this proposed action is provided by 
sections 101, 110, 112, 114, 116, and 301 of the Act as amended (42 
U.S.C. 7401, 7410, 7412, 7414, 7416, and 7601).

List of Subjects

40 CFR Part 49

    Administrative practices and procedures, Air pollution control, 
Environmental protection, Indians, Intergovernmental relations, 
Reporting and recordkeeping requirements.

40 CFR Part 51

    Administrative practices and procedures, Air pollution control, 
Environmental protection, Intergovernmental relations.


[[Page 48727]]


    Dated: August 9, 2006.
Stephen L. Johnson,
Administrator.

    For the reasons cited in the preamble, title 40, chapter I of the 
Code of Federal Regulations is proposed to be amended as follows:

PART 49--[AMENDED]

    1. The authority citation for part 49 continues to read as follows:

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

Subpart C--[Amended]

    2. Subpart C of Part 49 is amended by adding an undesignated center 
heading and Sec. Sec.  49.151 through 49.160, and adding and reserving 
Sec. Sec.  49.161 through 49.165 to read as follows:

Federal Minor New Source Review Program in Indian Country


Sec.  49.151  Program overview.

    (a) What constitutes the Federal minor new source review (NSR) 
program in Indian country? As set forth in this Federal Implementation 
Plan (FIP), the Federal minor NSR program in Indian country (or 
``program'') consists of Sec. Sec.  49.151 through 49.165.
    (b) What is the purpose of this program? This program has the 
following purposes:
    (1) It establishes a preconstruction permitting program for new and 
modified minor stationary sources (minor sources) and minor 
modifications at major stationary sources located in Indian country to 
meet the requirements of section 110(a)(2)(C) of the Act.
    (2) It also provides a mechanism for an otherwise major stationary 
source to voluntarily accept restrictions on its potential to emit to 
become a synthetic minor source. This mechanism also may be used by an 
otherwise major source of Hazardous Air Pollutants (HAPs) to 
voluntarily accept restrictions on its potential to emit to become a 
synthetic minor HAP source. Such restrictions must be enforceable as a 
practical matter.
    (3) It sets forth the criteria and procedures that the reviewing 
authority (as defined in Sec.  49.152(d)) will use to administer the 
program.
    (c) When and where does this program apply? (1) The provisions of 
this program apply in Indian country where there is no EPA-approved 
minor NSR program, beginning on [60 days from publication of final 
rule].
    (2) The provisions of this program cease to apply in an area 
covered by an EPA-approved implementation plan on the date that our 
approval of that implementation plan becomes effective, provided that 
the implementation plan includes provisions that comply with the 
requirements of section 110(a)(2)(C) of the Act for the construction 
and modification of minor sources and minor modifications at major 
stationary sources.
    (d) What general provisions apply under this program? The following 
general provisions apply to you as an owner/operator of a stationary 
source:
    (1) If you propose to construct a new minor source, a modification 
at an existing minor source, or a minor modification at an existing 
major stationary source that would be subject to this program, you must 
obtain a minor NSR permit under this program before beginning actual 
construction. If you commence construction after the effective date of 
this program without applying for and receiving a permit pursuant to 
this program, you will be subject to appropriate enforcement action.
    (2) If you construct or operate your source or modification not in 
accordance with the terms of your minor NSR permit, you will be subject 
to appropriate enforcement action.
    (3) Issuance of a permit does not relieve you of the responsibility 
to comply fully with applicable provisions of any EPA-approved 
implementation plan or FIP and any other requirements under applicable 
law.
    (4) Nothing in this program prevents a tribe from administering a 
minor NSR permit program with more stringent requirements in an 
approved Tribal Implementation Plan (TIP).
    (e) What is the process for issuing permits under this program? For 
the reviewing authority to issue a final permit decision under this 
program (other than a general permit under Sec.  49.156), all the 
actions listed in paragraphs (e)(1) through (8) of this section need to 
be completed. This paragraph (e) does not apply to general permits.
    (1) You must submit a permit application that meets the 
requirements of Sec.  49.154(a).
    (2) The reviewing authority determines completeness of the permit 
application as provided in Sec.  49.154(b).
    (3) The reviewing authority determines the appropriate emission 
limitations for your affected emissions units under Sec.  49.154(c).
    (4) In those rare instances where the reviewing authority has 
reason to be concerned that the construction of your minor source or 
modification would cause or contribute to a NAAQS or Prevention of 
Significant Deterioration (PSD) increment violation, you must submit an 
air quality analysis upon request by the reviewing authority.
    (5) The reviewing authority determines that the new or modified 
source will not cause or contribute to a NAAQS or PSD increment 
violation.
    (6) The reviewing authority develops a draft permit that meets the 
permit content requirements of Sec.  49.155(a).
    (7) The reviewing authority provides for public participation 
according to the requirements of Sec.  49.157.
    (8) The reviewing authority either issues a final permit that meets 
the requirements of Sec.  49.155(a), or denies the permit and provides 
reasons for the denial.


Sec.  49.152  Definitions.

    (a) For sources of regulated NSR pollutants in nonattainment areas, 
the definitions in Sec.  49.167 apply to the extent that they are used 
in this program (except for terms defined in paragraph (d) of this 
section).
    (b) For sources of regulated NSR pollutants in attainment or 
unclassifiable areas, the definitions in Sec.  52.21 of this chapter 
apply to the extent that they are used in this program (except for 
terms defined in paragraph (d) of this section).
    (c) For sources of HAP, the definitions in Sec.  63.2 of this 
chapter apply to the extent that they are used in this program (except 
for terms defined in paragraph (d) of this section).
    (d) The following definitions also apply to this program: Affected 
emissions units means the following emissions units, as applicable:
    (1) For a proposed new minor source, all the emissions units.
    (2) For a proposed modification, the new, modified, and replacement 
emissions units involved in the modification.
    (3) For an existing minor source applying for a minor source PAL, 
all the emissions units that emit the PAL pollutant. However, such 
units are considered affected emissions units only for the PAL 
pollutant.
    Allowable emissions means ``allowable emissions'' as defined in 
Sec.  52.21(b)(16) of this chapter, except that the allowable emissions 
for any emissions unit are calculated considering any emission 
limitations that are enforceable as a practical matter on the emissions 
unit's potential to emit.
    Emission limitation means a requirement established by the 
reviewing authority which limits the quantity, rate, or concentration 
of emissions of air pollutants on a continuous basis, including any 
requirement relating to the operation or

[[Page 48728]]

maintenance of a source to assure continuous emissions reduction, and 
any design standard, equipment standard, work practice, operational 
standard, or pollution prevention technique.
    Enforceable as a practical matter means that an emission limitation 
is both legally and practically enforceable as follows:
    (1) An emission limitation is ``legally enforceable'' if the 
reviewing authority has the right to enforce it.
    (2) Practical enforceability for an emission limitation in a permit 
for a source is achieved if the permit's provisions specify:
    (i) A limitation and the emissions unit(s) at the source subject to 
the limitation;
    (ii) The time period for the limitation (e.g., hourly, daily, 
monthly, and/or annual limits such as rolling annual limits); and
    (iii) The method to determine compliance, including appropriate 
monitoring, recordkeeping, reporting, and testing.
    (3) For rules and general permits that apply to categories of 
sources, practicable enforceability additionally requires that the 
provisions:
    (i) Identify the types or categories of sources that are covered by 
the rule or general permit;
    (ii) Where coverage is optional, provide for notice to the 
reviewing authority of the source's election to be covered by the rule 
or general permit; and
    (iii) Specify the enforcement consequences relevant to the rule or 
general permit.
    Environmental Appeals Board means the Board within the EPA 
described in Sec.  1.25(e) of this chapter.
    Indian country, as defined in 18 U.S.C. 1151, means the following:
    (1) All land within the limits of any Indian reservation under the 
jurisdiction of the United States government, notwithstanding the 
issuance of any patent, and including rights-of-way running through the 
reservation; \1\
---------------------------------------------------------------------------

    \1\ Under this definition, EPA treats as reservations trust 
lands validly set aside for the use of a tribe even if the trust 
lands have not been formally designated as a reservation.
---------------------------------------------------------------------------

    (2) All dependent Indian communities within the borders of the 
United States whether within the original or subsequently acquired 
territory thereof, and whether within or without the limits of a State; 
and
    (3) All Indian allotments, the Indian titles to which have not been 
extinguished, including rights-of-way running through the same.
    Indian governing body means the governing body of any tribe, band, 
or group of Indians subject to the jurisdiction of the United States 
and recognized by the United States as possessing power of self-
government.
    Minor modification at a major stationary source means a 
modification at a major stationary source that does not qualify as a 
major modification under Sec.  49.167 or Sec.  52.21 of this chapter, 
as applicable.
    Minor NSR threshold means any of the applicability cutoffs for this 
program listed in Table 1 of Sec.  49.153.
    Minor source plantwide applicability limitation (PAL) means a 
source-wide limitation on allowable emissions of a regulated NSR 
pollutant, expressed in tons per year, that is established for a minor 
source in a permit issued under Sec.  49.155 and that is enforceable as 
a practical matter.
    Minor stationary source or minor source means a source that emits 
or has the potential to emit regulated NSR pollutants in amounts that 
are less than the major stationary source levels in Sec.  49.167 or 
Sec.  52.21 of this chapter, as applicable. The term ``minor stationary 
source'' applies independently to each regulated NSR pollutant that the 
source has the potential to emit.
    Modification means any physical or operational change at a source 
that would cause an increase in the allowable emissions of the affected 
emissions units for any regulated NSR pollutant or that would cause the 
emission of any regulated NSR pollutant not previously emitted. The 
following exemptions apply:
    (1) A physical or operational change does not include routine 
maintenance, repair, or replacement.
    (2) An increase in the hours of operation or in the production rate 
is not considered an operational change unless such increase is 
prohibited under any federally-enforceable permit condition or other 
permit condition that is enforceable as a practical matter.
    (3) A change in ownership at a source is not considered a 
modification.
    Potential to emit means the maximum capacity of a source to emit a 
pollutant under its physical and operational design. Any physical or 
operational limitation on the capacity of the source to emit a 
pollutant, including air pollution control equipment and restrictions 
on hours of operation or on the type or amount of material combusted, 
stored, or processed, shall be treated as part of its design if the 
limitation or the effect it would have on emissions is federally 
enforceable or enforceable as a practical matter. Secondary emissions, 
as defined at Sec.  52.21(b)(18) of this chapter, do not count in 
determining the potential to emit of a source.
    Reviewing authority means the Administrator, and may mean an Indian 
tribe in cases where a tribal agency is assisting EPA with 
administration of the program through a delegation.
    Synthetic minor HAP source means a source that otherwise has the 
potential to emit HAPs in amounts that are at or above those for major 
sources of HAP in Sec.  63.2 of this chapter, but that has taken a 
restriction so that its potential to emit is less than such amounts for 
major sources. Such restrictions must be enforceable as a practical 
matter.
    Synthetic minor source means a source that otherwise has the 
potential to emit regulated NSR pollutants in amounts that are at or 
above those for major stationary sources in Sec.  49.167 or Sec.  52.21 
of this chapter, as applicable, but that has taken a restriction so 
that its potential to emit is less than such amounts for major 
stationary sources. Such restrictions must be enforceable as a 
practical matter. The term ``synthetic minor source'' applies 
independently for each regulated NSR pollutant that the source has the 
potential to emit.


Sec.  49.153  Applicability.

    (a) Does this program apply to me? The requirements of this program 
apply to you as set out in paragraphs (a)(1) through (5) of this 
section.
    (1) New and modified sources. The applicability of the 
preconstruction review requirements of this program is determined 
individually for each regulated NSR pollutant that would be emitted by 
your new or modified source. For each such pollutant, determine 
applicability as set out in the relevant paragraph (a)(1)(i) or (ii) of 
this section. Flowcharts 1 through 6 of this section are provided as 
aids for making these applicability determinations.
    (i) New source. Use the following steps to determine applicability 
for each regulated NSR pollutant. Flowchart 2 of this section addresses 
attainment and unclassifiable pollutants; Flowchart 4 of this section 
addresses nonattainment pollutants.
    (A) Step 1. For the pollutant being evaluated, determine whether 
your proposed source is subject to review under the applicable major 
NSR program (that is, under Sec.  52.21 of this chapter, under the 
Federal major NSR program for nonattainment areas in Indian country at 
Sec. Sec.  49.166 through 49.75, or under a program approved by the 
Administrator pursuant to Sec.  51.165 or Sec.  51.166 of this 
chapter). If not, go to Step 2 (paragraph (a)(1)(i)(B) of this 
section).

[[Page 48729]]

    (B) Step 2. Determine whether the source's potential to emit the 
pollutant that you are evaluating is greater than or equal to the 
corresponding minor NSR threshold in Table 1 of this section. If it is, 
you are subject to the preconstruction requirements of this program for 
that pollutant.
    (ii) Modification at an existing source. If you propose to make a 
physical or operational change at an existing source, determine whether 
the change qualifies as a modification (as defined in Sec.  49.152) 
using the procedures in paragraph (b) of this section to determine the 
increase in allowable emissions. If the change is a modification, use 
the following steps to determine applicability for each regulated NSR 
pollutant. Flowchart 3 of this section addresses attainment and 
unclassifiable pollutants; Flowchart 5 of this section addresses 
nonattainment pollutants. Flowchart 6 addresses minor NSR 
applicability. Note that if the physical or operational change is not a 
modification under this program, it may still be subject to some 
requirements under this program; See paragraphs (a)(2) through (5) of 
this section.
    (A) Step 1. For the pollutant being evaluated, determine whether 
your proposed modification is subject to review under the applicable 
major NSR program. If not, go to Step 2 (paragraph (a)(1)(ii)(B) of 
this section).
    (B) Step 2. Does your existing source have a minor source PAL for 
the pollutant that you are evaluating? If so, you are subject to the 
preconstruction requirements of this program for that pollutant. If 
not, go to Step 3 (paragraph (a)(1)(ii)(C) of this section).
    (C) Step 3. Determine whether the increase in allowable emissions 
from the proposed modification (calculated using the procedures of 
paragraph (b) of this section) would be greater than or equal to the 
minor NSR threshold in Table 1 of this section for the pollutant that 
you are evaluating. If it is, you are subject to the preconstruction 
requirements of this program for that pollutant. If not, go to Step 4 
(paragraph (a)(1)(ii)(D) of this section).
    (D) Step 4. If any of the emissions units affected by your proposed 
modification currently has an annual allowable emissions limit for the 
pollutant that you are evaluating, determine whether the modification 
would increase any such unit's allowable emissions above its existing 
limit. If so, the proposed modification is subject to paragraph (a)(2) 
of this section. If not, your proposed modification is not subject to 
this program.
    (2) Increase in an emissions unit's annual allowable emissions 
limit. If you propose a physical or operational change at your minor or 
major stationary source that would increase an emissions unit's 
allowable emissions of a regulated NSR pollutant above its existing 
annual allowable emissions limit, you must obtain an increase in the 
limit prior to making the change. For a physical or operational change 
that is not otherwise subject to review under major NSR or under this 
program, such increase in the annual allowable emissions limit can be 
accomplished through an administrative permit revision as provided in 
Sec.  49.159(f).
    (3) Synthetic minor permits. If you propose to establish a 
synthetic minor source or synthetic minor HAP source, you must apply 
for a permit under Sec.  49.158. Additionally, if you currently own or 
operate such a source that was established by maintaining your actual 
emissions at less than 50 percent of the relevant major source 
threshold, you must obtain a synthetic minor permit under this program 
according to the requirements of Sec.  49.158.
    (4) Minor source PALs. If you propose to establish a minor source 
PAL for your existing minor source, you must apply for a permit under 
Sec.  49.154.
    (5) Case-by-case maximum achievable control technology (MACT) 
determinations. If you propose to construct or reconstruct a major 
source of HAPs such that you are subject to a case-by-case MACT 
determination under section 112(g)(2) of the Act, you may elect to have 
this determination approved under the provisions of this program. 
(Other options for such determinations include a title V permit action 
or a Notice of MACT Approval under Sec.  63.43 of this chapter.) If you 
elect this option, you still must comply with the requirements of Sec.  
63.43 of this chapter that apply to all case-by-case MACT 
determinations.
    (b) How do I determine the increase in allowable emissions from a 
physical or operational change at my source? Determine the resulting 
increase in allowable emissions in tons per year (tpy) of each 
regulated NSR pollutant after considering all increases and decreases 
from the change according to paragraph (b)(1) or (2) of this section, 
as applicable. A physical or operational change may involve one or more 
emissions units.
    (1) For a change at a minor source with a minor source PAL, the 
emissions increase would be the PAL level after the change minus the 
PAL level prior to the change.
    (2) For other changes, the total increase in allowable emissions 
resulting from your proposed change would be the sum of the following:
    (i) For each new emissions unit that is to be added, the emissions 
increase would be the potential to emit of the emissions unit.
    (ii) For each emissions unit with an allowable emissions limit that 
is to be changed or replaced, the emissions increase would be the 
allowable emissions of the emissions unit after the change or 
replacement minus the allowable emissions prior to the change or 
replacement. This may be a negative value for an emissions unit if the 
allowable emissions of the unit would be reduced as a result of the 
change or replacement.
    (iii) For each unpermitted emissions unit that is to be changed or 
replaced, the emissions increase is the allowable emissions of the 
emissions unit after the change or replacement minus the potential to 
emit prior to the change or replacement. This may be a negative value 
for an emissions unit if its post-change allowable emissions would be 
less than its pre-change potential to emit.
    (c) What emissions units and activities are exempt from this 
program? This program does not apply to the following emissions units 
and activities at a source that are listed in paragraphs (c)(1) through 
(10) of this section.
    (1) Mobile sources.
    (2) Air-conditioning units used for comfort that are not subject to 
applicable requirements under title VI of the Act and do not exhaust 
air pollutants into the ambient air from any manufacturing or other 
industrial process.
    (3) Ventilating units used for comfort that do not exhaust air 
pollutants into the ambient air from any manufacturing or other 
industrial process.
    (4) Heating units used for comfort that do not provide heat for any 
manufacturing or other industrial process.
    (5) Noncommercial food preparation.
    (6) Consumer use of office equipment and products.
    (7) Janitorial services and consumer use of janitorial products.
    (8) Internal combustion engines used for landscaping purposes.
    (9) Bench scale laboratory activities, except for laboratory fume 
hoods or vents.
    (10) Any emissions unit or activity that does not emit or have the 
potential to emit a regulated NSR pollutant or HAP, so long as that 
emissions unit or activity is not part of a process unit that emits or 
has the potential to emit a regulated NSR pollutant or HAP.

[[Page 48730]]



                               Table 1 to Sec.   49.153. Minor NSR Thresholds.\1\
----------------------------------------------------------------------------------------------------------------
                                                                Minor NSR thresholds for
                                                               nonattainment areas  (tpy)         Minor NSR
                  Regulated NSR pollutant                   --------------------------------    thresholds for
                                                              Extreme ozone                    attainment areas
                                                                  areas        Other areas          (tpy)
----------------------------------------------------------------------------------------------------------------
Carbon monoxide............................................               5               5                   10
Oxides of nitrogen.........................................               0               5                   10
Sulfur dioxide.............................................               5               5                   10
VOC........................................................               0               2                    5
PM.........................................................               5               5                   10
PM-10......................................................               1               1                    5
PM-2.5.....................................................             0.6             0.6                    3
Lead.......................................................             0.1             0.1                  0.1
Fluorides..................................................              NA              NA                    1
Sulfuric acid mist.........................................              NA              NA                    2
Hydrogen sulfide (H2S).....................................              NA              NA                    2
Total reduced sulfur (including H2S).......................              NA              NA                    2
Reduced sulfur compounds (including H2S)...................              NA              NA                    2
Municipal waste combustor emissions........................              NA              NA                    2
Municipal solid waste landfills emissions (measured as                   NA              NA                  10
 nonmethane organic compounds).............................
----------------------------------------------------------------------------------------------------------------
\1\ If part of a tribe's area of Indian country is designated as attainment and another part as nonattainment,
  the applicable threshold for a proposed source or modification is determined based on the designation where
  the source would be located. If the source straddles the two areas, the more stringent thresholds would apply.

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Sec.  49.154  Permit application requirements.

    This section applies to you if you are subject to this program 
under Sec.  49.153(a)(1) for the construction of new minor sources or 
modifications at existing sources. (As an alternative, you may apply 
for a general permit under Sec.  49.156 if an applicable general permit 
is available for your source type.) In addition, this section applies 
to you if you wish to establish a minor source PAL for your existing 
minor source (See Sec.  49.153(a)(4)). See Sec.  49.158(a) for 
synthetic minor permit application requirements.
    (a) What information must my permit application contain? Paragraphs 
(a)(1) through (3) of this section govern the content of your 
application.
    (1) General provisions for permit applications. The following 
provisions apply to permit applications under this program:
    (i) The reviewing authority may develop permit application forms 
for your use.
    (ii) The permit application need not contain information on the 
exempt emissions units and activities listed in Sec.  49.153(c).
    (iii) The permit application for a modification need only include 
information on the affected emissions units as defined in Sec.  
49.152(d).
    (2) Required permit application content. Except as specified in 
paragraphs (a)(1)(ii) and (iii) of this section, you must include the 
information listed in paragraphs (a)(2)(i) through (ix) of this section 
in your application for a permit under this program. The reviewing 
authority may require additional information as needed to process the 
permit application.
    (i) Identifying information, including your name and address (and 
plant name and address if different) and the name and telephone number 
of the plant manager/contact.
    (ii) A description of your source's processes and products.
    (iii) A list of all affected emissions units (with the exception of 
the exempt emissions units and activities listed in Sec.  49.153(c)).
    (iv) For each new emissions unit that is listed, the potential to 
emit of each regulated NSR pollutant in tpy (including fugitive 
emissions, to the extent that they are quantifiable), with supporting 
documentation. In your calculation of the potential to emit for an 
emissions unit, you must account for any proposed emission limitations.
    (v) For each modified emissions unit and replacement unit that is 
listed, the allowable emissions of each regulated NSR pollutant in tpy 
both before and after the modification (including fugitive emissions, 
to the extent that they are quantifiable), with supporting 
documentation. For emissions units that do not have an allowable 
emissions limit prior to the modification, report the potential to 
emit. In your calculation of annual allowable emissions for an 
emissions unit after the modification, you must account for any 
proposed emission limitations.
    (vi) The following information to the extent it is needed to 
determine or regulate emissions: fuels, fuel use, raw materials, 
production rates, and operating schedules.
    (vii) Identification and description of any existing air pollution 
control equipment and compliance monitoring devices or activities.
    (viii) Any existing limitations on source operation affecting 
emissions or any work practice standards, where applicable, for all NSR 
regulated pollutants at the source.
    (ix) For each emission point associated with an affected emissions 
unit, provide stack or vent dimensions and flow information.
    (3) Optional permit application content. At your option, you may 
propose the following:
    (i) Emission limitations for each affected emissions unit, which 
may include pollution prevention techniques, air pollution control 
devices, design standards, equipment standards, work practices, 
operational standards, or a combination thereof. You may include an 
explanation of why you believe the proposed emission limitations to be 
appropriate.
    (ii) A minor source PAL, which is a source-wide annual allowable 
emissions limit, for one or more of the regulated NSR pollutants 
emitted by your source.
    (b) How is my permit application determined to be complete? 
Paragraphs (b)(1) through (3) of this section govern the completeness 
review of your permit application.
    (1) An application for a permit under this program will be reviewed 
by the reviewing authority within 45 days of its receipt to determine 
whether the application contains all the information necessary for 
processing the application. You should contact the reviewing authority 
to find out the date of receipt of the application.
    (2) If the reviewing authority determines that the application is 
not complete, it will request additional information from you as 
necessary to process the application. If the reviewing authority 
determines that the application is complete, it may notify you in 
writing. If you do not receive a request for additional information or 
a notice of complete application from the reviewing authority within 50 
days of its receipt of your application, your application will be 
deemed complete.
    (3) If, while processing an application that has been determined to 
be complete, the reviewing authority determines that additional 
information is necessary to evaluate or take final action on the 
application, it may request additional information from you and require 
your responses within a reasonable time period.
    (c) How will the reviewing authority determine the emission 
limitations that will be required in my permit? After determining that 
your application is complete, the reviewing authority will conduct a 
case-by-case control technology review to determine the appropriate 
level of control, if any, necessary to assure that NAAQS are achieved, 
as well as the corresponding emission limitations for the affected 
emissions units at your source.
    (1) In carrying out this case-by-case review, the reviewing 
authority will consider the following factors:
    (i) Local air quality conditions.
    (ii) Typical control technology or other emissions reduction 
measures used by similar sources in surrounding areas.
    (iii) Anticipated economic growth in the area.
    (iv) Cost-effective emission reduction alternatives.
    (2) The reviewing authority must require an emission limit (i.e., a 
limit on the quantity, rate, or concentration of emissions) for each 
affected emissions unit at your source for which such a limit is 
technically and economically feasible.
    (3) The emission limitations required by the reviewing authority 
may consist of emission limits, pollution prevention techniques, design 
standards, equipment standards, work practice standards, operational 
standards, or any combination thereof.
    (4) The emission limitations required by the reviewing authority 
must assure that each affected emissions unit will comply with all 
requirements of parts 60, 61, and 63 of this chapter that apply to the 
unit.
    (5) The emission limitations required by the reviewing authority 
must not be affected in any manner by so much of a stack's height as 
exceeds good engineering practice or by any other dispersion technique, 
except as provided in Sec.  51.118(b) of this chapter. If the reviewing 
authority proposes to issue a permit to a source based on a good 
engineering practice stack height that exceeds the height allowed by 
Sec.  51.100(ii)(1) or (2) of this chapter, it

[[Page 48738]]

must notify the public of the availability of the demonstration study 
and must provide opportunity for a public hearing according to the 
requirements of Sec.  49.157 for the draft permit.
    (d) When may the reviewing authority require an air quality impacts 
analysis (AQIA)? Paragraphs (d)(1) through (3) of this section govern 
AQIA requirements under this program.
    (1) In those rare instances where the reviewing authority has 
reason to be concerned that the construction of your minor source or 
modification would cause or contribute to a NAAQS or PSD increment 
violation, it may require you to conduct and submit an AQIA.
    (2) If required, you must conduct the AQIA using the dispersion 
models and procedures of part 51, Appendix W of this chapter.
    (3) If the AQIA reveals that construction of your source or 
modification would cause or contribute to a NAAQS or PSD increment 
violation, the reviewing authority must require you to reduce such 
impacts before it can issue you a permit.


Sec.  49.155  Permit requirements.

    This section applies to your permit if you are subject to this 
program under Sec.  49.153(a)(1) for construction of new minor sources 
or modifications at existing sources, unless you applied for a general 
permit under Sec.  49.156 (where an applicable general permit is 
available for your source type). In addition, this section applies to 
your permit if you wish to establish a minor source PAL for your 
existing minor source (See Sec.  49.153(a)(4))
    (a) What information must my permit include? Your permit must 
include the requirements in paragraphs (a)(1) through (7) of this 
section.
    (1) General requirements. The following elements must be included 
in your permit:
    (i) The effective date of the permit and the date by which you must 
commence construction in order for your permit to remain valid (i.e., 
18 months after the permit effective date).
    (ii) The emissions units subject to the permit and their associated 
emission limitations.
    (iii) Monitoring, recordkeeping, reporting, and testing 
requirements to assure compliance with the emission limitations.
    (2) Emission limitations. The permit must include the emission 
limitations determined by the reviewing authority under Sec.  49.154(c) 
for each affected emissions unit. In addition, the permit must address 
limits on annual allowable emissions as set out in paragraphs (a)(2)(i) 
and (ii) of this section.
    (i) New minor sources. For new minor sources, limits on annual 
allowable emissions in tpy must be included in the permit as follows:
    (A) The reviewing authority may include minor source PALs for one 
or more regulated NSR pollutants, if you requested such PALs.
    (B) Otherwise, the reviewing authority must include an annual 
allowable emissions limit for each affected emissions unit, for each 
regulated NSR pollutant emitted by the unit that is not subject to a 
minor source PAL.
    (ii) Existing minor sources. For existing minor sources, limits on 
annual allowable emissions in tpy must be included in the permit as 
follows:
    (A) The reviewing authority may include minor source PALs for one 
or more regulated NSR pollutants, if you requested such PALs.
    (B) For a modification, the reviewing authority must include an 
annual allowable emissions limit for each affected emissions unit, for 
each regulated NSR pollutant emitted by the unit that is not subject to 
a minor source PAL.
    (C) If you apply for a minor source PAL for one or more regulated 
NSR pollutants for your existing source at a time when you are not also 
proposing a modification, no annual allowable emissions limits are 
required for the regulated NSR pollutants that are not subject to a 
PAL.
    (3) Monitoring requirements. The permit must include monitoring 
requirements sufficient to assure compliance with the emission 
limitations that apply to the affected emissions units at your source. 
The reviewing authority may require, as appropriate, any of the 
requirements in paragraphs (a)(3)(i) through (iii) of this section.
    (i) Any emissions monitoring, including analysis procedures, test 
methods, periodic testing, instrumental monitoring, and non-
instrumental monitoring. Such monitoring requirements shall assure use 
of test methods, units, averaging periods, and other statistical 
conventions consistent with the required emission limitations.
    (ii) As necessary, requirements concerning the use, maintenance, 
and installation of monitoring equipment or methods.
    (iii) If the permit includes a minor source PAL for a pollutant at 
your minor source, monitoring to determine the actual emissions from 
your source for each month and the total actual emissions for each 12-
month period, rolled monthly, for that pollutant.
    (4) Recordkeeping requirements. The permit must include 
recordkeeping requirements sufficient to assure compliance with the 
emission limitations and monitoring requirements, and must require the 
elements in paragraphs (a)(4)(i) and (ii) of this section.
    (i) Records of required monitoring information that include the 
information in paragraphs (a)(4)(i)(A) through (F) of this section, as 
appropriate.
    (A) The location, date, and time of sampling or measurements.
    (B) The date(s) analyses were performed.
    (C) The company or entity that performed the analyses.
    (D) The analytical techniques or methods used.
    (E) The results of such analyses.
    (F) The operating conditions existing at the time of sampling or 
measurement.
    (ii) Retention for 5 years of records of all required monitoring 
data and support information for the monitoring sample, measurement, 
report, or application. Support information may include all calibration 
and maintenance records, all original strip-chart recordings or digital 
records for continuous monitoring instrumentation, copies of all 
reports required by the permit, and for sources with a minor source PAL 
for a pollutant, the actual emissions determined for each month and the 
total actual emissions for each 12-month period, rolled monthly, for 
that pollutant.
    (5) Reporting requirements The permit must include the reporting 
requirements in paragraphs (a)(5)(i) and (ii) of this section.
    (i) Annual submittal of reports of monitoring required under 
paragraph (a)(3) of this section, including the type and frequency of 
monitoring, and a summary of results obtained by monitoring.
    (ii) Prompt reporting of deviations from permit requirements, 
including those attributable to upset conditions as defined in the 
permit, the probable cause of such deviations, and any corrective 
actions or preventive measures taken. Within the permit, the reviewing 
authority must define ``prompt'' in relation to the degree and type of 
deviation likely to occur and the applicable emission limitations.
    (6) Severability clause. The permit must include a severability 
clause to ensure the continued validity of the other portions of the 
permit in the event of a challenge to a portion of the permit.
    (7) Additional provisions. The permit must also contain provisions 
stating the requirements in paragraphs (a)(7)(i) through (vii) of this 
section.

[[Page 48739]]

    (i) You, as the permittee, must comply with all conditions of your 
permit, including emission limitations that apply to the affected 
emissions units at your source. Noncompliance with any permit term or 
condition is a violation of the permit and may constitute a violation 
of the Act and is grounds for enforcement action and for a permit 
termination or revocation.
    (ii) Your permitted source must not cause or contribute to a NAAQS 
violation or, in an attainment area, must not cause or contribute to a 
PSD increment violation.
    (iii) It is not a defense for you, as the permittee, in an 
enforcement action that it would have been necessary to halt or reduce 
the permitted activity in order to maintain compliance with the 
conditions of this permit.
    (iv) The permit may be revised, reopened, revoked and reissued, or 
terminated for cause. The filing of a request by you, as the permittee, 
for a permit revision, revocation and re-issuance, or termination, or 
of a notification of planned changes or anticipated noncompliance does 
not stay any permit condition.
    (v) The permit does not convey any property rights of any sort or 
any exclusive privilege.
    (vi) You, as the permittee, shall furnish to the reviewing 
authority, within a reasonable time, any information that the reviewing 
authority may request in writing to determine whether cause exists for 
revising, revoking and reissuing, or terminating the permit or to 
determine compliance with the permit. For any such information claimed 
to be confidential, you must also submit a claim of confidentiality in 
accordance with part 2, subpart B of this chapter.
    (vii) Inspection and entry provisions requiring that upon 
presentation of proper credentials, you, as the permittee, must allow a 
representative of the reviewing authority to:
    (A) Enter upon your premises where a source is located or 
emissions-related activity is conducted, or where records are required 
to be kept under the conditions of the permit;
    (B) Have access to and copy, at reasonable times, any records that 
are required to be kept under the conditions of the permit;
    (C) Inspect, during normal business hours or while the source is in 
operation, any facilities, equipment (including monitoring and air 
pollution control equipment), practices, or operations regulated or 
required under the permit;
    (D) Sample or monitor, at reasonable times, substances or 
parameters for the purpose of assuring compliance with the permit or 
other applicable requirements; and
    (E) Record any inspection by use of written, electronic, magnetic 
and photographic media.
    (b) Can my permit become invalid? Your permit becomes invalid if 
you do not commence construction within 18 months after the effective 
date of your permit, if you discontinue construction for a period of 18 
months or more, or if you do not complete construction within a 
reasonable time. The reviewing authority may extend the 18-month period 
upon a satisfactory showing that an extension is justified. This 
provision does not apply to the time period between construction of the 
approved phases of a phased construction project; you must commence 
construction of each such phase within 18 months of the projected and 
approved commencement date.


Sec.  49.156  General permits.

    This section applies to general permits for the purposes of 
complying with the preconstruction permitting requirements for sources 
of regulated NSR pollutants under this program.
    (a) What is a general permit? A general permit is a preconstruction 
permit issued by a reviewing authority that may be applied to a number 
of similar emissions units or sources. The purpose of a general permit 
is to simplify the permit application and issuance process for similar 
facilities so that a reviewing authority's limited resources need not 
be expended for case-by-case permit development for such facilities. A 
general permit may be written to address a single emissions unit, a 
group of the same type of emissions units, or an entire minor source.
    (b) How will the reviewing authority issue general permits? The 
reviewing authority will issue general permits as follows:
    (1) A general permit may be issued for a category of emissions 
units or sources that are similar in nature, have substantially similar 
emissions, and would be subject to the same or substantially similar 
requirements governing operations, emissions, monitoring, reporting, 
and recordkeeping. ``Similar in nature'' refers to size, processes, and 
operating conditions.
    (2) A general permit must be issued according to the requirements 
for public participation in Sec.  49.157 and the requirements for final 
permit issuance and administrative and judicial review in Sec.  49.159.
    (3) Issuance of a general permit is considered final agency action 
with respect to all aspects of the general permit except its 
applicability to an individual source. The sole issue that may be 
appealed after an individual source is approved to construct under a 
general permit (See paragraph (e) of this section) is the applicability 
of the general permit to that particular source.
    (c) For what categories will general permits be issued? (1) The 
reviewing authority will determine which categories of individual 
emissions units, groups of similar emissions units, or sources are 
appropriate for general permits in its area.
    (2) General permits will be issued at the discretion of the 
reviewing authority. However, the following are some common categories 
of emissions units or sources for which general permits may be 
developed:
    (i) Autobody repair shops.
    (ii) Concrete batching plants.
    (iii) Dry cleaners.
    (iv) Gas stations.
    (v) Gas distribution facilities.
    (vi) General purpose internal combustion engines.
    (vii) Hot mix asphalt facilities.
    (viii) Heating units.
    (ix) Nonmetallic mineral processing plants.
    (x) Rock crushing facilities.
    (xi) Surface coating operations.
    (xii) Solvent cleaning operations.
    (xiii) Graphic arts operations.
    (xiv) Grain elevators.
    (xv) Tank batteries in oil and gas production operations that are 
not part of a larger source.
    (xvi) Small to medium compressor stations.
    (xvii) Small to medium transmission stations.
    (xviii) Dehydrators that are not a part of a larger source.
    (xix) Compressor engines.
    (d) What should the general permit contain? The general permit must 
contain the permit elements listed in Sec.  49.155(a). In addition, the 
general permit must contain the information listed in paragraphs (d)(1) 
and (2) of this section. The reviewing authority may specify additional 
general permit terms and conditions.
    (1) Identification of the specific category of emissions units or 
sources to which the general permit applies, including any criteria 
that your emissions units or source must meet to be eligible for 
coverage under the general permit.
    (2) Information required to apply for coverage under a general 
permit including, but not limited to, the following:

[[Page 48740]]

    (i) The name and mailing address of the reviewing authority to whom 
you must submit your application.
    (ii) The procedure to obtain any standard application forms that 
the reviewing authority may have developed.
    (iii) The information that you must provide to the reviewing 
authority in your application to demonstrate that you are eligible for 
coverage under the general permit.
    (iv) Other application requirements deemed necessary by the 
reviewing authority.
    (e) How is my source issued a general permit? (1) If your source 
qualifies for a general permit, you may apply to the reviewing 
authority for coverage under the general permit.
    (2) The reviewing authority must act on your application for 
coverage under the general permit as expeditiously as possible, but it 
must notify you of the final decision within 90 days.
    (3) Without repeating the public participation procedures required 
in Sec.  49.157, the reviewing authority may grant or deny your request 
for approval to construct under a general permit. The reviewing 
authority must send you a letter approving or disapproving the request 
to construct under a general permit. Such a letter is a final permit 
action for purposes of judicial review (See Sec.  49.159) only for the 
issue of whether your source qualifies for the general permit. You must 
post a prominent notice at your source of the letter of approval to 
construct under the general permit.
    (4) If the reviewing authority has sent a letter approving the 
general permit for your source, you must comply with all conditions and 
terms of the general permit. You will be subject to enforcement action 
for failure to obtain a preconstruction permit if you construct the 
emissions unit(s) or source with general permit approval and your 
source is later determined not to qualify for the conditions and terms 
of the general permit.
    (5) Any source covered under a letter approving the general permit 
may request to be excluded from the general permit by applying for a 
permit under Sec.  49.154.


Sec.  49.157  Public participation requirements.

    This section applies to the issuance of preconstruction permits, 
synthetic minor permits, and the initial issuance of general permits. 
It does not apply to decisions regarding whether a specific source is 
eligible for coverage under a general permit.
    (a) What permit information will be publicly available? With the 
exception of any confidential information as defined in part 2, subpart 
B of this chapter, the reviewing authority must make available for 
public inspection the documents listed in paragraphs (a)(1) through (5) 
of this section. The reviewing authority must make such information 
available for public inspection at the appropriate EPA Regional Office 
and in at least one location in the area affected by the source, such 
as the tribal environmental office or a local library.
    (1) All information submitted as part of an application for a 
permit.
    (2) Any additional information requested by the reviewing 
authority.
    (3) The reviewing authority's analysis of the application and any 
additional information submitted by the source, including (for 
preconstruction and general permits) the control technology review.
    (4) For preconstruction and general permits, the reviewing 
authority's analysis of the effect of the construction of the minor 
source or modification on ambient air quality.
    (5) A copy of the draft permit or the decision to deny the permit 
with the justification for denial.
    (b) How will the public be notified and participate? (1) Before 
issuing a permit under this program, the reviewing authority must 
prepare a draft permit and must provide adequate public notice to 
ensure that the affected community and the general public have 
reasonable access to the application and draft permit information, as 
set out in paragraphs (b)(1)(i) and (ii) of this section The public 
notice must provide an opportunity for public comment and notice of a 
public hearing, if any, on the draft permit.
    (i) The reviewing authority must mail a copy of the notice to you, 
the appropriate Indian governing body, and the tribal, State, and local 
air pollution authorities having jurisdiction in areas outside of the 
area of Indian country potentially impacted by the air pollution 
source.
    (ii) Depending on such factors as the nature and size of your 
source, local air quality considerations, and the characteristics of 
the population in the affected area, the reviewing authority must use 
appropriate means of notification, such as those listed in paragraphs 
(b)(1)(ii)(A) through (E) of this section.
    (A) The reviewing authority may mail or e-mail a copy of the notice 
to persons on a mailing list developed by the reviewing authority 
consisting of those persons who have requested to be placed on such a 
mailing list.
    (B) The reviewing authority may post the notice on its Web site.
    (C) The reviewing authority may publish the notice in a newspaper 
of general circulation in the area affected by the source. Where 
possible, the notice may also be published in a tribal newspaper or 
newsletter.
    (D) The reviewing authority may provide copies of the notice for 
posting at one or more locations in the area affected by the source, 
such as Post Offices, trading posts, libraries, tribal environmental 
offices, community centers, or other gathering places in the community.
    (E) The reviewing authority may employ other means of notification 
as appropriate.
    (2) The notice required pursuant to paragraph (b)(1) of this 
section must include the following information at a minimum:
    (i) Identifying information, including your name and address (and 
plant name and address if different) and the name and telephone number 
of the plant manager/contact.
    (ii) The name and address of the reviewing authority processing the 
permit action;
    (iii) For preconstruction permits (including general permits), the 
regulated NSR pollutants to be emitted, the affected emissions units, 
and the emission limitations for each affected emissions unit;
    (iv) For preconstruction permits, the emissions change involved in 
the permit action;
    (v) For synthetic minor permits, a description of the proposed 
limitation and its effect on the potential to emit of the source;
    (vi) Instructions for requesting a public hearing;
    (vii) The name, address, and telephone number of a contact person 
in the reviewing authority's office from whom additional information 
may be obtained;
    (viii) Locations and times of availability of the information 
(listed in paragraph (a) of this section) for public inspection; and
    (ix) A statement that any person may submit written comments, a 
written request for a public hearing, or both, on the draft permit 
action. The reviewing authority must provide a period of at least 30 
days from the date of the public notice for comments, and for requests 
for a public hearing.
    (c) How will the public comment, and will there be a public 
hearing? (1) Any person may submit written comments on the draft permit 
and may request a public hearing. These comments must raise any 
reasonably ascertainable issue

[[Page 48741]]

with supporting arguments by the close of the public comment period 
(including any public hearing). The reviewing authority must consider 
all comments in making the final decision. The reviewing authority must 
keep a record of the commenters and of the issues raised during the 
public participation process, and such records must be available to the 
public.
    (2) The reviewing authority must extend the public comment period 
under paragraph (b) of this section to the close of any public hearing 
under this section. The hearing officer may also extend the comment 
period by so stating at the hearing.
    (3) A request for a public hearing must be in writing and must 
state the nature of the issues proposed to be raised at the hearing.
    (4) The reviewing authority must hold a hearing whenever there is, 
on the basis of requests, a significant degree of public interest in a 
draft permit. The reviewing authority may also hold a public hearing at 
its discretion, whenever, for instance, such a hearing might clarify 
one or more issues involved in the permit decision. The reviewing 
authority must provide notice of any public hearing at least 30 days 
prior to the date of the hearing. Public notice of the hearing may be 
concurrent with that of the draft permit, and the two notices may be 
combined. Reasonable limits may be set upon the time allowed for oral 
statements at the hearing.
    (5) The reviewing authority must make a tape recording or written 
transcript of any hearing available to the public.


Sec.  49.158  Synthetic minor permits.

    You may obtain a synthetic minor permit under this program to 
establish a synthetic minor source and/or a synthetic minor HAP source. 
Note that if you propose to construct or modify a synthetic minor 
source, you are also subject to the preconstruction permitting 
requirements in Sec. Sec.  49.154 and 49.155.
    (a) What information must my synthetic minor permit application 
contain? (1) Your application must include the following information:
    (i) Identifying information, including your name and address (and 
plant name and address if different) and the name and telephone number 
of the plant manager/contact.
    (ii) For each regulated NSR pollutant and/or HAP and for all 
emissions units to be covered by an emissions limitation, the following 
information:
    (A) The proposed emission limitation and a description of its 
effect on actual emissions or the potential to emit. Proposed emission 
limitations must have a reasonably short averaging period, taking into 
consideration the operation of the source and the methods to be used 
for demonstrating compliance.
    (B) Proposed testing, monitoring, recordkeeping, and reporting 
requirements to be used to demonstrate and assure compliance with the 
proposed limitation.
    (C) A description of the production processes.
    (D) Identification of the emissions units.
    (E) Type and quantity of fuels and/or raw materials used.
    (F) Description and estimated efficiency of air pollution control 
equipment under present or anticipated operating conditions.
    (G) Estimates of the current actual emissions and current potential 
to emit, including all calculations for the estimates.
    (H) Estimates of the allowable emissions and/or potential to emit 
that would result from compliance with the proposed limitation, 
including all calculations for the estimates.
    (iii) Any other information specifically requested by the reviewing 
authority.
    (2) Estimates of actual emissions must be based upon actual test 
data, or in the absence of such data, upon procedures acceptable to the 
reviewing authority. Any emission estimates submitted to the reviewing 
authority must be verifiable using currently accepted engineering 
criteria. The following procedures are generally acceptable for 
estimating emissions from air pollution sources:
    (i) Source-specific emission tests;
    (ii) Mass balance calculations;
    (iii) Published, verifiable emission factors that are applicable to 
the source;
    (iv) Other engineering calculations; or
    (v) Other procedures to estimate emissions specifically approved by 
the reviewing authority.
    (b) What are the procedures for obtaining a synthetic minor permit? 
(1) If you wish to obtain a synthetic minor permit under this program, 
you must submit a permit application to the reviewing authority. The 
application must contain the information specified in paragraph (a) of 
this section. If the reviewing authority has developed application 
forms for such permits, you must use those forms.
    (2) Within 60 days after receipt of an application, the reviewing 
authority will determine if it contains the information specified in 
paragraph (a) of this section and, if so, will determine it complete 
for the purpose of preparing a draft synthetic minor permit. You should 
contact the reviewing authority to find out the date of receipt of the 
application.
    (3) If the reviewing authority determines that the application is 
not complete, it will request additional information from you as 
necessary to process the application. If the reviewing authority 
determines that the application is complete, it may notify you in 
writing. If you do not receive a request for additional information or 
a notice of complete application from the reviewing authority within 65 
days of its receipt of your application, your application will be 
deemed complete.
    (4) The reviewing authority will prepare a draft synthetic minor 
permit that describes the proposed limitation and its effect on the 
potential to emit of the source.
    (5) The reviewing authority must provide an opportunity for public 
participation and public comment on the draft synthetic minor permit as 
set out in Sec.  49.157.
    (6) After the close of the public comment period, the reviewing 
authority will review all comments received and prepare a final 
synthetic minor permit.
    (7) The final synthetic minor permit will be issued and will be 
subject to administrative and judicial review as set out in Sec.  
49.159.
    (c) What are my responsibilities under this program for my existing 
synthetic minor source or synthetic minor HAP source? If you have an 
existing synthetic minor source or synthetic minor HAP source, you are 
subject to either paragraph (c)(1) or paragraph (c)(2) of this section, 
as follows:
    (1) If your synthetic minor status is established through a permit 
or other document that is enforceable as a practical matter, you do not 
need to do anything. You may use the mechanism established in this 
program according to the requirements of paragraphs (a) and (b) of this 
section to replace your existing synthetic minor permit when it 
expires.
    (2) If you have achieved your existing synthetic minor status by 
maintaining your actual emissions at less than 50 percent of the 
relevant major source threshold, you must obtain a synthetic minor 
permit under this program according to the requirements of paragraphs 
(a) and (b) of this section. The following provisions apply:
    (i) You must apply for a synthetic minor permit by [1 year and 60 
days after publication of final rule], and you must respond in a timely 
manner to any requests from the reviewing authority for additional 
information.

[[Page 48742]]

    (ii) Provided that you submit your application and any requested 
additional information as indicated in paragraph (c)(2)(i) of this 
section, your source will continue to be considered a synthetic minor 
source or synthetic minor HAP source (as applicable) until your 
synthetic minor permit under this program has been issued.
    (iii) Should you fail to submit your application and any requested 
additional information as indicated in paragraph (c)(2)(i) of this 
section, your source will no longer be considered a synthetic minor 
source or synthetic minor HAP source (as applicable), and will 
immediately become subject to all requirements for major sources.


Sec.  49.159  Final permit issuance and administrative and judicial 
review.

    (a) How will final action occur, and when will my permit become 
effective? After decision on a permit, the reviewing authority must 
notify you of the decision, in writing, and if the permit is denied, of 
the reasons for such denial. If the reviewing authority issues a final 
permit to you, it must make a copy of the permit available at all of 
the locations where the draft permit was made available. In addition, 
the reviewing authority must provide adequate public notice of the 
final permit decision to ensure that the affected community, general 
public, and any individuals who commented on the draft permit have 
reasonable access to the decision and supporting materials. A final 
permit becomes effective 30 days after permit issuance, unless:
    (1) A later effective date is specified in the permit; or
    (2) Review of the final permit is requested under paragraph (d) of 
this section (in which case the specific terms and conditions of the 
permit that may be the subject of the request for review must be 
stayed); or
    (3) The reviewing authority may make the permit effective 
immediately upon issuance if no comments requested a change in the 
draft permit or a denial of the permit.
    (b) For how long will the reviewing authority retain my permit-
related records? The records, including any required applications for 
each draft and final permit or application for permit revision, must be 
kept by the reviewing authority for not less than 5 years.
    (c) What is the administrative record for each final permit? (1) 
The reviewing authority must base final permit decisions on an 
administrative record consisting of:
    (i) The application and any supporting data furnished by the 
applicant;
    (ii) The draft permit or notice of intent to deny the application;
    (iii) Other documents in the supporting files for the draft permit 
that were relied upon in the decisionmaking;
    (iv) All comments received during the public comment period, 
including any extension or reopening;
    (v) The tape or transcript of any hearing(s) held;
    (vi) Any written material submitted at such a hearing;
    (vii) Any new materials placed in the record as a result of the 
reviewing authority's evaluation of public comments;
    (viii) The final permit; and
    (ix) Other documents in the supporting files for the final permit 
that were relied upon in the decisionmaking.
    (2) The additional documents required under paragraph (c)(1) of 
this section should be added to the record as soon as possible after 
their receipt or publication by the reviewing authority. The record 
must be complete on the date the final permit is issued.
    (3) Material readily available or published materials that are 
generally available and that are included in the administrative record 
under the standards of paragraph (c)(1) of this section need not be 
physically included in the same file as the rest of the record as long 
as it is specifically referred to in the that file.
    (d) Can permit decisions be appealed? Permit decisions may be 
appealed according to the following provisions:
    (1) The Administrator delegates authority to the Environmental 
Appeals Board (the Board) to issue final decisions in permit appeals 
filed under this program, including informal appeals of denials of 
requests for modification, revocation and re-issuance, or termination 
of permits under paragraph (e)(2) of this section. An appeal directed 
to the Administrator, rather than to the Board, will be forwarded to 
the Board for consideration. This delegation does not preclude the 
Board from referring an appeal or a motion under this program to the 
Administrator when the Board, in its discretion, deems it appropriate 
to do so. When an appeal or motion is referred to the Administrator by 
the Board, all parties shall be so notified and the provisions of this 
program referring to the Board shall be interpreted as referring to the 
Administrator.
    (2) Within 30 days after a final permit decision has been issued, 
any person who filed comments on the draft permit or participated in 
the public hearing may petition the Board to review any condition of 
the permit decision. Any person who failed to file comments and failed 
to participate in the public hearing on the draft permit may petition 
for administrative review only to the extent that the changes from the 
draft to the final permit or other new grounds were not reasonably 
foreseeable during the public comment period on the draft permit. The 
30-day period within which a person may request review under this 
section begins when the reviewing authority has fulfilled the notice 
requirements for the final permit decision, unless a later date is 
specified in that notice.
    (3) The petition must include a statement of the reasons supporting 
the review, including a demonstration that any issues identified were 
raised during the public comment period (including any public hearing) 
to the extent required by these regulations, unless the petitioner 
demonstrates that it was impracticable to raise such objections within 
such period or unless the grounds for such objection arose after such 
period, and, when appropriate, a showing that the condition in question 
is based on:
    (i) A finding of fact or conclusion of law that is clearly 
erroneous; or
    (ii) An exercise of discretion or an important policy consideration 
that the Board should, in its discretion, review.
    (4) The Board may also decide on its own initiative to review any 
condition of any permit issued under this program.
    (5) Within a reasonable time following the filing of the petition 
for review, the Board must issue an order either granting or denying 
the petition for review. To the extent review is denied, the conditions 
of the final permit decision become final agency action. If the Board 
grants review in response to requests under paragraph (d)(2) or (4) of 
this section, public notice must be given as provided in 
Sec. 49.157(b). Public notice must set forth a briefing schedule for 
the appeal and must state that any interested person may file an amicus 
brief. If the Board denies review, the permit applicant and the 
person(s) requesting review must be notified through means that are 
adequate to assure reasonable access to the decision, which may include 
mailing a notice to each.
    (6) A petition to the Board under paragraph (d)(2) of this section 
is, under 42 U.S.C. 307(b), a prerequisite to seeking judicial review 
of the final agency action.
    (7) For purposes of judicial review, final agency action occurs 
when a final permit is issued or denied by the reviewing authority and 
agency review procedures are exhausted. A final

[[Page 48743]]

permit decision must be issued by the reviewing authority:
    (i) When the Board issues notice to the parties that review has 
been denied;
    (ii) When the Board issues a decision on the merits of the appeal 
and the decision does not include a remand of the proceedings; or
    (iii) Upon the completion of remand proceedings if the proceedings 
are remanded, unless the Board's remand order specifically provides 
that appeal of the remand decision will be required to exhaust 
administrative remedies.
    (8) Motions to reconsider a final order must be filed within 10 
days after service of the final order. Every such motion must set forth 
the matters claimed to have been erroneously decided and the nature of 
the alleged errors. Motions for reconsideration under this provision 
must be directed to, and decided by, the Board. Motions for 
reconsideration directed to the Administrator, rather than to the 
Board, will be forwarded to the Board for consideration, except in 
cases in which the Board has deferred to the Administrator and the 
Administrator has issued the final order. A motion for reconsideration 
must not stay the effective date of the final order unless specifically 
so ordered by the Board.
    (9) For purposes of this section, time periods are computed as 
follows:
    (i) Any time period scheduled to begin on the occurrence of an act 
or event must begin on the day after the act or event.
    (ii) Any time period scheduled to begin before the occurrence of an 
act or event must be computed so that the period ends on the day before 
the act or event, except as otherwise provided.
    (iii) If the final day of any time period falls on a weekend or 
legal holiday, the time period must be extended to the next working 
day.
    (iv) Whenever a party or interested person has the right or is 
required to act within a prescribed period after the service of notice 
or other paper upon him or her by mail, 3 days must be added to the 
prescribed time.
    (e) Can my permit be reopened? Your permit can be reopened 
according to the following procedures:
    (1) Any person (including the permittee) may petition the reviewing 
authority to reopen a permit for cause, and the reviewing authority may 
commence a permit reopening on its own initiative. The reviewing 
authority may not reopen a permit for cause unless it contains a 
material mistake or fails to assure compliance with applicable 
requirements. All requests must be in writing and must contain reasons 
supporting the request.
    (2) If the reviewing authority decides the request is not 
justified, the reviewing authority must send the requestor a brief 
written response giving a reason for the decision. Denials of requests 
for revision, revocation and re-issuance, or termination are not 
subject to public notice, comment, or hearings. Denials by the 
reviewing authority may be informally appealed to the Board by a letter 
briefly setting forth the relevant facts. The Board may direct the 
reviewing authority to begin revision, revocation and re-issuance, or 
termination proceedings under paragraph (e)(3) of this section. The 
appeal must be considered denied if the Board takes no action within 60 
days after receiving it. This informal appeal is, under 42 U.S.C. 307, 
a prerequisite to seeking judicial review of EPA action in denying a 
request for revision, revocation and re-issuance, or termination.
    (3) If the reviewing authority decides the request is justified and 
that cause exists to revise, revoke and reissue or terminate a permit, 
it shall initiate proceedings to reopen the permit.
    (f) What is an administrative permit revision? The following 
provisions govern administrative permit revisions.
    (1) An administrative permit revision is a permit revision that 
makes any of the following changes:
    (i) Corrects typographical errors.
    (ii) Identifies a change in the name, address, or phone number of 
any person identified in the permit, or provides a similar minor 
administrative change at the source.
    (iii) Requires more frequent monitoring or reporting by the 
permittee.
    (iv) Allows for a change in ownership or operational control of a 
source where the reviewing authority determines that no other change in 
the permit is necessary, provided that a written agreement containing a 
specific date for transfer of permit responsibility, coverage, and 
liability between the current and new permittee has been submitted to 
the reviewing authority.
    (v) Establishes an increase in an emissions unit's annual allowable 
emissions limit for a regulated NSR pollutant, when the action that 
necessitates such increase is not otherwise subject to review under 
major NSR or under this program.
    (vi) Incorporates any other type of change that the reviewing 
authority has determined to be similar to those in paragraphs (f)(1)(i) 
through (v) of this section.
    (2) An administrative permit revision is not subject to the permit 
application, issuance, public participation, or administrative and 
judicial review requirements of this program.


Sec.  49.160  Administration and delegation of the minor NSR program in 
Indian country.

    (a) Who administers a minor NSR program in Indian country? (1) If 
the Administrator has approved a TIP that includes a minor NSR program 
for sources in Indian country that meets the requirements of section 
110(a)(2)(C) of the Act and Sec. Sec. 51.160 through 51.164 of this 
chapter, the tribe is the reviewing authority and will administer the 
approved minor NSR program under tribal law.
    (2) If the Administrator has not approved an implementation plan, 
the Administrator may delegate the authority to assist EPA with 
administration of portions of this Federal minor NSR program 
implemented under Federal authority to a tribal agency upon request, in 
accordance with the provisions of paragraph (b) of this section. If the 
tribal agency has been granted such delegation, it will have the 
authority to assist EPA according to paragraph (b) of this section.
    (3) If the Administrator has not approved an implementation plan or 
granted delegation to a tribal agency, the Administrator is the 
reviewing authority and will directly administer all aspects of this 
Federal minor NSR program in Indian country under Federal authority.
    (b) Delegation of administration of the Federal minor NSR program 
to tribes. This paragraph (b) establishes the process by which the 
Administrator may delegate authority to a tribal agency, with or 
without signature authority, to assist EPA with administration of 
portions of this Federal minor NSR program, in accordance with the 
provisions in paragraphs (b)(1) through (8) of this section. Any 
Federal requirements under this program that are administered by the 
delegate tribal agency will be subject to enforcement by EPA under 
Federal law. This section provides for administrative delegation of the 
Federal minor NSR program and does not affect the eligibility criteria 
under Sec.  49.6 for treatment in the same manner as a State.
    (1) Information to be included in the Administrative Delegation 
Request. In order to be delegated authority to assist EPA with 
administration of this FIP permit program for sources, the tribal 
agency must submit a request to the Administrator that:
    (i) Identifies the specific provisions for which delegation is 
requested;

[[Page 48744]]

    (ii) Identifies the Indian Reservation or other areas of Indian 
country for which delegation is requested;
    (iii) Includes a statement by the applicant's legal counsel (or 
equivalent official) that includes the following information:
    (A) A statement that the applicant is a tribe recognized by the 
Secretary of the Interior;
    (B) A descriptive statement that is consistent with the type of 
information described in Sec.  49.7(a)(2) demonstrating that the 
applicant is currently carrying out substantial governmental duties and 
powers over a defined area; and
    (C) A description of the laws of the tribe that provide adequate 
authority to administer the Federal rules and provisions for which 
delegation is requested; and
    (iv) Demonstrates that the tribal agency has the technical 
capability and adequate resources to administer the FIP provisions for 
which the delegation is requested.
    (2) Delegation of Partial Administrative Authority Agreement. A 
Delegation of Partial Administrative Authority Agreement (Agreement) 
will set forth the terms and conditions of the delegation, will specify 
the provisions that the delegate tribal agency will be authorized to 
implement on behalf of EPA, and will be entered into by the 
Administrator and the delegate tribal agency. The Agreement will become 
effective upon the date that both the Administrator and the delegate 
tribal agency have signed the Agreement or as otherwise stated in the 
Agreement. Once the delegation becomes effective, the delegate tribal 
agency will be responsible, to the extent specified in the Agreement, 
for assisting EPA with administration of the provisions of the Federal 
minor NSR program that are subject to the Agreement.
    (3) Publication of notice of the Agreement. The Administrator will 
publish a notice in the Federal Register informing the public of any 
Agreement for a particular area of Indian country. The Administrator 
also will publish the notice in a newspaper of general circulation in 
the area affected by the delegation. In addition, the Administrator 
will mail a copy of the notice to persons on a mailing list developed 
by the Administrator consisting of those persons who have requested to 
be placed on such a mailing list.
    (4) Revision or revocation of an Agreement. An Agreement may be 
modified, amended, or revoked, in part or in whole, by the 
Administrator after consultation with the delegate tribal agency.
    (5) Transmission of information to the Administrator. When 
administration of a portion of the Federal minor NSR program in Indian 
country that includes receipt of permit application materials and 
preparation of draft permits has been delegated in accordance with the 
provisions of this section, the delegate tribal agency must provide to 
the Administrator a copy of each permit application (including any 
application for permit revision) and each draft permit. The applicant 
may be required by the delegate tribal agency to provide a copy of the 
permit application directly to the Administrator. With the 
Administrator's consent, the delegate tribal agency may submit to the 
Administrator a permit application summary form and any relevant 
portion of the permit application, in place of the complete permit 
application. To the extent practicable, the preceding information 
should be provided in electronic format as requested by the 
Administrator.
    (6) Waiver of information transmission requirements. The 
Administrator may waive the requirements of paragraph (b)(5) of this 
section for any category of sources (including any class, type, or size 
within such category) by transmitting the waiver in writing to the 
delegate tribal agency.
    (7) Retention of records. Where a delegate tribal agency prepares 
draft or final permits or receives applications for permit revisions on 
behalf of EPA, the records for each draft and final permit or 
application for permit revision must be kept by the delegate tribal 
agency for a period not less than 5 years. The delegate tribal agency 
must also submit to the Administrator such information as the 
Administrator may reasonably require to ascertain whether the delegate 
tribal agency is implementing and administering the delegated program 
in compliance with the requirements of the Act and of this program.
    (8) Delegation of signature authority. To receive delegation of 
signature authority, the legal statement submitted by the tribal agency 
pursuant to paragraph (b)(1) of this section must certify that no 
applicable provision of tribal law requires that a minor NSR permit be 
issued after a certain time if the delegate tribal agency has failed to 
take action on the application (or includes any other similar provision 
providing for default issuance of a permit).
    (c) Are there any non-delegable elements of the Federal minor NSR 
program in Indian country? The following authorities cannot be 
delegated outside of EPA:
    (1) The Administrator's authority to object to the issuance of a 
minor NSR permit.
    (2) The Administrator's authority to enforce, revoke, or terminate 
permits issued pursuant to this program.
    (d) How will EPA transition its authority to an approved minor NSR 
program? (1) The Administrator will suspend the issuance of minor NSR 
permits under this program promptly upon publication of notice of 
approval of an implementation plan with a minor NSR permit program for 
that area.
    (2) The Administrator may retain jurisdiction over the permits for 
which the administrative or judicial review process is not complete and 
will address this issue in the notice of program approval.
    (3) After approval of a program for issuing minor NSR permits and 
the suspension of issuance of minor NSR permits by the Administrator, 
the Administrator will continue to administer minor NSR permits until 
permits are issued under the approved implementation plan program.


Sec. Sec.  49.161-49.165  [Reserved]

    3. Subpart C of Part 49 is amended by adding an undesignated center 
heading and Sec. Sec.  49.166 through 49.173, and adding and reserving 
Sec. Sec.  49.174 and 49.175 to read as follows:

Federal Major New Source Review Program for Nonattainment Areas in 
Indian Country


Sec.  49.166  Program overview.

    (a) What constitutes the Federal major new source review (NSR) 
program for nonattainment areas in Indian country? As set forth in this 
Federal Implementation Plan (FIP), the Federal major NSR program for 
nonattainment areas in Indian country (or ``program'') consists of 
Sec. Sec.  49.166 through 49.175.
    (b) What is the purpose of this program? This program has the 
following purposes:
    (1) It establishes a preconstruction permitting program for new 
major stationary sources and major modifications at existing major 
stationary sources located in nonattainment areas in Indian country to 
meet the requirements of part D of title I of the Act.
    (2) It requires that major stationary sources subject to this 
program comply with the provisions and requirements of part 51, 
appendix S of this chapter (appendix S). Additionally, it sets forth 
the criteria and procedures in appendix S that the reviewing authority 
(as defined in Sec.  49.167) will use to approve permits under this 
program. Note that for the purposes of this program, the

[[Page 48745]]

term ``SIP'' as used in appendix S means any EPA-approved 
implementation plan, including a Tribal Implementation Plan (TIP). 
While some of the important provisions of appendix S are paraphrased in 
various paragraphs of this program to highlight them, the provisions of 
appendix S govern.
    (3) It also sets forth procedures for appealing a permit issued 
under this program as provided in Sec.  49.172.
    (c) When and where does this program apply? (1) The provisions of 
this program apply to new major stationary sources and major 
modifications at existing major stationary sources located in 
nonattainment areas in Indian country where there is no EPA-approved 
nonattainment major NSR program beginning on [date 60 days from date of 
publication of final rule]. The provisions of this program apply only 
to stationary sources and modifications that are major for the 
regulated NSR pollutant(s) for which the area is designated 
nonattainment.
    (2) The provisions of this program cease to apply in an area 
covered by an EPA-approved implementation plan on the date that our 
approval of that plan becomes effective, provided that the plan 
includes provisions that comply with the requirements of part D of 
title I of the Act and Sec.  51.165 of this chapter for the 
construction of new major stationary sources and major modifications at 
existing major stationary sources in nonattainment areas.
    (d) What general provisions apply under this program? The following 
general provisions apply to you as an owner/operator of a stationary 
source:
    (1) If you propose to construct a new major stationary source or a 
major modification at an existing major stationary source in a 
nonattainment area in Indian country, you must obtain a major NSR 
permit under this program before beginning actual construction. If you 
commence construction after the effective date of this program without 
applying for and receiving a permit pursuant to this program, you will 
be subject to appropriate enforcement action.
    (2) If you do not construct or operate your source or modification 
in accordance with the terms of your major NSR permit issued under this 
program, you will be subject to appropriate enforcement action.
    (3) Issuance of a permit under this program does not relieve you of 
the responsibility to comply fully with applicable provisions of any 
EPA-approved implementation plan or FIP and any other requirements 
under applicable law.
    (4) Nothing in this program prevents a tribe from administering a 
major NSR permit program with more stringent requirements in an 
approved TIP.


Sec.  49.167  Definitions.

    For the purposes of this program, the definitions in paragraph II.A 
of appendix S to part 51 of this chapter apply, unless otherwise 
stated. The following definitions also apply to this program:
    Allowable emissions means ``allowable emissions'' as defined in 
paragraph II.A.11 of appendix S to part 51 of this chapter, except that 
the allowable emissions for any emissions unit are calculated 
considering any emission limitations that are enforceable as a 
practical matter on the emissions unit's potential to emit.
    Enforceable as a practical matter means that an emission limitation 
or other standard is both legally and practically enforceable as 
follows:
    (1) An emission limitation or other standard is ``legally 
enforceable'' if the reviewing authority has the right to enforce it.
    (2) Practical enforceability for an emission limitation or for 
other standards (design standards, equipment standards, work practices, 
operational standards, pollution prevention techniques) in a permit for 
a stationary source is achieved if the permit's provisions specify:
    (i) A limitation or standard and the emissions units or activities 
at the stationary source subject to the limitation or standard;
    (ii) The time period for the limitation or standard (e.g., hourly, 
daily, monthly, and/or annual limits such as rolling annual limits); 
and
    (iii) The method to determine compliance, including appropriate 
monitoring, recordkeeping, reporting, and testing.
    (3) For rules and general permits that apply to categories of 
stationary sources, practicable enforceability additionally requires 
that the provisions:
    (i) Identify the types or categories of sources that are covered by 
the rule or general permit;
    (ii) Where coverage is optional, provide for notice to the 
reviewing authority of the source's election to be covered by the rule 
or general permit; and
    (iii) Specify the enforcement consequences relevant to the rule or 
general permit.
    Environmental Appeals Board means the Board within the EPA 
described in Sec.  1.25(e) of this chapter.
    Indian country, as defined in 18 U.S.C. 1151, means the following:
    (1) All land within the limits of any Indian reservation under the 
jurisdiction of the United States government, notwithstanding the 
issuance of any patent, and including rights-of-way running through the 
reservation;\2\
---------------------------------------------------------------------------

    \2\ Under this definition, EPA treats as reservations trust 
lands validly set aside for the use of a tribe even if the trust 
lands have not been formally designated as a reservation.
---------------------------------------------------------------------------

    (2) All dependent Indian communities within the borders of the 
United States whether within the original or subsequently acquired 
territory thereof, and whether within or without the limits of a State; 
and
    (3) All Indian allotments, the Indian titles to which have not been 
extinguished, including rights-of-way running through the same.
    Indian governing body means the governing body of any tribe, band, 
or group of Indians subject to the jurisdiction of the United States 
and recognized by the United States as possessing power of self-
government.
    Regulated NSR pollutant, for purposes of this program, means the 
following:
    (1) Nitrogen oxides or any volatile organic compounds;
    (2) Any pollutant for which a national ambient air quality standard 
has been promulgated; or
    (3) Any pollutant that is a constituent or precursor of a general 
pollutant listed under paragraphs (1) or (2) of this definition, 
provided that a constituent or precursor pollutant may only be 
regulated under NSR as part of regulation of the general pollutant.
    Reviewing authority means the Administrator and may mean an Indian 
tribe in cases where a tribal agency is assisting EPA with 
administration of the program through a delegation under Sec.  49.173.
    Synthetic minor HAP source means a stationary source that otherwise 
has the potential to emit HAPs in amounts that are at or above those 
for major sources of HAP in Sec.  63.2 of this chapter, but that has 
taken a restriction such that its potential to emit is less than such 
amounts for major sources. Such restrictions must be enforceable as a 
practical matter.
    Synthetic minor source means a stationary source that otherwise has 
the potential to emit regulated NSR pollutants in amounts that are at 
or above those for major stationary sources in appendix S to part 51 of 
this chapter, but that has taken a restriction such that its potential 
to emit is less than such

[[Page 48746]]

amounts for major stationary sources. Such restrictions must be 
enforceable as a practical matter. The term ``synthetic minor source'' 
applies independently for each regulated NSR pollutant that the 
stationary source has the potential to emit.


Sec.  49.168  Does this program apply to me?

    (a) In a nonattainment area in Indian country, the requirements of 
this program apply to you under either of the following circumstances:
    (1) If you propose to construct a new major stationary source (as 
defined in paragraph II.A.4 of appendix S to part 51 of this chapter) 
of the nonattainment pollutant.
    (2) If you propose to construct a major modification at your 
existing major stationary source (as defined in paragraph II.A.5 of 
appendix S to part 51 of this chapter), where your source is a major 
stationary source of the nonattainment pollutant and the proposed 
modification is a major modification for the nonattainment pollutant.
    (b) If you own or operate a major stationary source with a State-
issued nonattainment major NSR permit, you must apply to convert such 
permit to a Federal permit under this program by [date 1 year and 60 
days from date of publication of final rule]. In this case, you would 
not be subject to any additional requirements under this program.
    (c) If you propose to establish a synthetic minor source or 
synthetic minor HAP source, or to construct a minor modification at 
your major stationary source, you will have to comply with the 
requirements of the Federal minor NSR program in Indian country at 
Sec. Sec. 49.51 through 49.165 or other EPA-approved minor NSR program, 
as applicable.


Sec.  49.169  Permit approval criteria.

    (a) What are the general criteria for permit approval? The general 
review criteria for permits are provided in paragraph II.B of appendix 
S to part 51 of this chapter. In summary, that paragraph basically 
requires the reviewing authority to ensure that the proposed new major 
stationary source or major modification would meet all applicable 
emission requirements in the EPA-approved implementation plan or FIP, 
any applicable NSPS in part 60 of this chapter, and any applicable 
NESHAP in part 61 or part 63 of this chapter, before a permit can be 
issued.
    (b) What are the program-specific criteria for permit approval? The 
approval criteria or conditions for obtaining a major NSR permit for 
major stationary sources and major modifications locating in 
nonattainment areas are given in paragraph IV.A of appendix S to part 
51 of this chapter. In summary, these are the following:
    (1) The lowest achievable emission rate (LAER) requirement for any 
NSR pollutant subject to this program.
    (2) Certification that all existing major stationary sources owned 
or operated by you in the same State as the proposed source or 
modification are in compliance or under a compliance schedule.
    (3) Emissions reductions (offsets) requirement for any source or 
modification subject to this program.
    (4) A demonstration that the emission offsets will provide a net 
air quality benefit in the affected area.


Sec.  49.170  Emission offset requirement exemption.

    An Indian governing body may seek an exemption from the emission 
offset requirement (See Sec.  49.169(b)(3)) for major stationary 
sources and major modifications subject to this program that are 
located within the tribe(s Indian country pursuant to the following 
options:
    (a) Section 173(a)(1)(B) Economic Development Zone (EDZ) option. 
Under section 173(a)(1)(B) of the Act, major stationary sources and 
major modifications subject to this program may be exempted from the 
offset requirement if they are located in a zone targeted for economic 
development by the Administrator, in consultation with the Department 
of Housing and Urban Development (HUD). Under the EDZ option, the 
Administrator would waive the offset requirement for such sources and 
modifications, provided that:
    (1) The new major stationary source or major modification is 
located in a geographical area which meets the criteria for an EDZ, and 
the Administrator has approved a request from a tribe and declared the 
area an EDZ; and
    (2) The State/tribe demonstrates that the new permitted emissions 
are consistent with the achievement of reasonable further progress 
pursuant to section 172(c)(4) of the Act, and will not interfere with 
attainment of the applicable NAAQS by the applicable attainment date.
    (b) Appendix S, paragraph VI option. Pursuant to paragraph VI of 
appendix S to part 51 of this chapter, for a new major stationary 
source or major modification locating in a nonattainment area for which 
the attainment date has not yet passed, such source or modification 
would be exempt from all requirements of this program, including the 
offset requirement, provided all the following conditions are met:
    (1) The new major stationary source or major modification complies 
with any applicable EPA-approved implementation plan or FIP emission 
limitations.
    (2) The new major stationary source or major modification will not 
interfere with the attainment date for a regulated NSR pollutant.
    (3) The Administrator has determined that conditions specified in 
paragraphs (b)(1) and (2) of this section are satisfied and such 
determination is published in the Federal Register.


Sec.  49.171  Public participation requirements.

    (a) What permit information will be publicly available? With the 
exception of any confidential information as defined in part 2, subpart 
B of this chapter, the reviewing authority must make available for 
public inspection the documents listed in paragraphs (a)(1) through (4) 
of this section. The reviewing authority must make such information 
available for public inspection at the appropriate EPA Regional Office 
and in at least one location in the area affected by the stationary 
source, such as the tribal environmental office or a local library.
    (1) All information submitted as part of an application for a 
permit.
    (2) Any additional information requested by the reviewing 
authority.
    (3) The reviewing authority's analysis of the application and any 
additional information submitted by you, including the LAER analysis 
and, where applicable, the analysis of your emissions reductions 
(offsets) and your demonstration of a net air quality benefit in the 
affected area.
    (4) A copy of the draft permit or the decision to deny the permit 
with the justification for denial.
    (b) How will the public be notified and participate? (1) Before 
issuing a permit under this program, the reviewing authority must 
prepare a draft permit and must provide adequate public notice to 
ensure that the affected community and the general public have 
reasonable access to the application and draft permit information, as 
set out in paragraphs (b)(1)(i) and (ii) of this section. The public 
notice must provide an opportunity for public comment and notice of a 
public hearing, if any, on the draft permit.
    (i) The reviewing authority must mail a copy of the notice to you, 
the appropriate Indian governing body, and the tribal, State, and local 
air pollution authorities having jurisdiction in areas outside of the 
area of Indian country

[[Page 48747]]

potentially impacted by the air pollution source.
    (ii) Depending on such factors as the nature and size of your 
stationary source, local air quality considerations, and the 
characteristics of the population in the affected area, the reviewing 
authority must use appropriate means of notification, such as those 
listed in paragraphs (b)(1)(ii)(A) through (E) of this section.
    (A) The reviewing authority may mail or e-mail a copy of the notice 
to persons on a mailing list developed by the reviewing authority 
consisting of those persons who have requested to be placed on such a 
mailing list.
    (B) The reviewing authority may post the notice on its Web site.
    (C) The reviewing authority may publish the notice in a newspaper 
of general circulation in the area affected by the source. Where 
possible, the notice may also be published in a tribal newspaper or 
newsletter.
    (D) The reviewing authority may provide copies of the notice for 
posting at one or more locations in the area affected by the source, 
such as Post Offices, trading posts, libraries, tribal environmental 
offices, community centers, or other gathering places in the community.
    (E) The reviewing authority may employ other means of notification 
as appropriate.
    (2) The notice required pursuant to paragraph (b)(1) of this 
section must include the following information at a minimum:
    (i) Identifying information, including your name and address (and 
plant name and address if different) and the name and telephone number 
of the plant manager/contact.
    (ii) The name and address of the reviewing authority processing the 
permit action;
    (iii) The regulated NSR pollutants to be emitted, the affected 
emissions units, and the emission limitations for each affected 
emissions unit;
    (iv) The emissions change involved in the permit action;
    (v) Instructions for requesting a public hearing;
    (vi) The name, address, and telephone number of a contact person in 
the reviewing authority's office from whom additional information may 
be obtained;
    (vii) Locations and times of availability of the information 
(listed in paragraph (a) of this section) for public inspection; and
    (viii) A statement that any person may submit written comments, a 
written request for a public hearing, or both, on the draft permit 
action. The reviewing authority must provide a period of at least 30 
days from the date of the public notice for comments, and for requests 
for a public hearing.
    (c) How will the public comment, and will there be a public 
hearing? (1) Any person may submit written comments on the draft permit 
and may request a public hearing. These comments must raise any 
reasonably ascertainable issue with supporting arguments by the close 
of the public comment period (including any public hearing). The 
reviewing authority must consider all comments in making the final 
decision. The reviewing authority must keep a record of the commenters 
and of the issues raised during the public participation process, and 
such records must be available to the public.
    (2) The reviewing authority must extend the public comment period 
under paragraph (b) of this section to the close of any public hearing 
under this section. The hearing officer may also extend the comment 
period by so stating at the hearing.
    (3) A request for a public hearing must be in writing and must 
state the nature of the issues proposed to be raised at the hearing.
    (4) The reviewing authority must hold a hearing whenever there is, 
on the basis of requests, a significant degree of public interest in a 
draft permit. The reviewing authority may also hold a public hearing at 
its discretion, whenever, for instance, such a hearing might clarify 
one or more issues involved in the permit decision. The reviewing 
authority must provide notice of any public hearing at least 30 days 
prior to the date of the hearing. Public notice of the hearing may be 
concurrent with that of the draft permit, and the two notices may be 
combined. Reasonable limits may be set upon the time allowed for oral 
statements at the hearing.
    (5) The reviewing authority must make a tape recording or written 
transcript of any hearing available to the public.


Sec.  49.172  Final permit issuance and administrative and judicial 
review.

    (a) How will final action occur, and when will my permit become 
effective? After decision on a permit, the reviewing authority must 
notify you of the decision, in writing, and if the permit is denied, of 
the reasons for such denial. If the reviewing authority issues a final 
permit to you, it must make a copy of the permit available at any 
location where the draft permit was made available. In addition, the 
reviewing authority must provide adequate public notice of the final 
permit decision to ensure that the affected community, general public, 
and any individuals who commented on the draft permit have reasonable 
access to the decision and supporting materials. A final permit becomes 
effective 30 days after permit issuance, unless:
    (1) A later effective date is specified in the permit; or
    (2) Review of the final permit is requested under paragraph (d) of 
this section (in which case the specific terms and conditions of the 
permit that may be the subject of the request for review must be 
stayed); or
    (3) The draft permit was subjected to a public comment period and 
no comments requested a change in the draft permit or a denial of the 
permit, in which case the reviewing authority may make the permit 
effective immediately upon issuance.
    (b) For how long will the reviewing authority retain my permit-
related records? The records, including any required applications for 
each draft and final permit or application for permit revision, must be 
kept by the reviewing authority for not less than 5 years.
    (c) What is the administrative record for each final permit? (1) 
The reviewing authority must base final permit decisions on an 
administrative record consisting of:
    (i) All comments received during any public comment period, 
including any extension or reopening;
    (ii) The tape or transcript of any hearing(s) held;
    (iii) Any written material submitted at such a hearing;
    (iv) Any new materials placed in the record as a result of the 
reviewing authority's evaluation of public comments;
    (v) Other documents in the supporting files for the permit that 
were relied upon in the decisionmaking;
    (vi) The final permit;
    (vii) The application and any supporting data furnished by the 
applicant;
    (viii) The draft permit or notice of intent to deny the application 
or to terminate the permit; and
    (ix) Other documents in the supporting files for the draft permit 
that were relied upon in the decisionmaking.
    (2) The additional documents required under paragraph (c)(1) of 
this section should be added to the record as soon as possible after 
their receipt or publication by the reviewing authority. The record 
must be complete on the date the final permit is issued.
    (3) Material readily available or published materials that are 
generally available and that are included in the administrative record 
under the standards of paragraph (c)(1) of this

[[Page 48748]]

section need not be physically included in the same file as the rest of 
the record as long as it is specifically referred to in that file.
    (d) Can permit decisions be appealed? Permit decisions may be 
appealed according to the following provisions:
    (1) The Administrator delegates authority to the Environmental 
Appeals Board (the Board) to issue final decisions in permit appeals 
filed under this program, including informal appeals of denials of 
requests for modification, revocation and re-issuance, or termination 
of permits under paragraph (e)(2) of this section. An appeal directed 
to the Administrator, rather than to the Board, will be forwarded to 
the Board for consideration. This delegation does not preclude the 
Board from referring an appeal or a motion under this program to the 
Administrator when the Board, in its discretion, deems it appropriate 
to do so. When an appeal or motion is referred to the Administrator by 
the Board, all parties shall be so notified and the provisions of this 
program referring to the Board shall be interpreted as referring to the 
Administrator.
    (2) Within 30 days after a final permit decision has been issued, 
any person who filed comments on the draft permit or participated in 
the public hearing may petition the Board to review any condition of 
the permit decision. Any person who failed to file comments and failed 
to participate in the public hearing on the draft permit may petition 
for administrative review only to the extent that the changes from the 
draft to the final permit or other new grounds were not reasonably 
foreseeable during the public comment period on the draft permit. The 
30-day period within which a person may request review under this 
section begins when the reviewing authority has fulfilled the notice 
requirements for the final permit decision, unless a later date is 
specified in that notice.
    (3) The petition must include a statement of the reasons supporting 
the review, including a demonstration that any issues identified were 
raised during the public comment period (including any public hearing) 
to the extent required by these regulations, unless the petitioner 
demonstrates that it was impracticable to raise such objections within 
such period or unless the grounds for such objection arose after such 
period, and, when appropriate, a showing that the condition in question 
is based on:
    (i) A finding of fact or conclusion of law that is clearly 
erroneous; or
    (ii) An exercise of discretion or an important policy consideration 
that the Board should, in its discretion, review.
    (4) The Board may also decide on its own initiative to review any 
condition of any permit issued under this program.
    (5) Within a reasonable time following the filing of the petition 
for review, the Board must issue an order either granting or denying 
the petition for review. To the extent review is denied, the conditions 
of the final permit decision become final agency action. If the Board 
grants review in response to requests under paragraph (d)(2) or (4) of 
this section, public notice must be given as provided in Sec.  
49.171(b). Public notice must set forth a briefing schedule for the 
appeal and must state that any interested person may file an amicus 
brief. If the Board denies review, the permit applicant and the 
person(s) requesting review must be notified through means that are 
adequate to assure reasonable access to the decision, which may include 
mailing a notice to each.
    (6) A petition to the Board under paragraph (d)(2) of this section 
is, under 42 U.S.C. 307(b), a prerequisite to seeking judicial review 
of the final agency action.
    (7) For purposes of judicial review, final agency action occurs 
when a final permit is issued or denied by the reviewing authority and 
agency review procedures are exhausted. A final permit decision must be 
issued by the reviewing authority:
    (i) When the Board issues notice to the parties that review has 
been denied;
    (ii) When the Board issues a decision on the merits of the appeal 
and the decision does not include a remand of the proceedings; or
    (iii) Upon the completion of remand proceedings if the proceedings 
are remanded, unless the Board's remand order specifically provides 
that appeal of the remand decision will be required to exhaust 
administrative remedies.
    (8) Notice of any final agency action on a permit shall promptly be 
published in the Federal Register.
    (9) Motions to reconsider a final order must be filed within 10 
days after service of the final order. Every such motion must set forth 
the matters claimed to have been erroneously decided and the nature of 
the alleged errors. Motions for reconsideration under this provision 
must be directed to, and decided by, the Board. Motions for 
reconsideration directed to the Administrator, rather than to the 
Board, will be forwarded to the Board for consideration, except in 
cases in which the Board has deferred to the Administrator and the 
Administrator has issued the final order. A motion for reconsideration 
must not stay the effective date of the final order unless specifically 
so ordered by the Board.
    (10) For purposes of this section, time periods are computed as 
follows:
    (i) Any time period scheduled to begin on the occurrence of an act 
or event must begin on the day after the act or event.
    (ii) Any time period scheduled to begin before the occurrence of an 
act or event must be computed so that the period ends on the day before 
the act or event, except as otherwise provided.
    (iii) If the final day of any time period falls on a weekend or 
legal holiday, the time period must be extended to the next working 
day.
    (iv) Whenever a party or interested person has the right or is 
required to act within a prescribed period after the service of notice 
or other paper upon him or her by mail, 3 days must be added to the 
prescribed time.
    (e) Can my permit be reopened? Your permit can be reopened 
according to the following procedures:
    (1) Any person (including the permittee) may petition the reviewing 
authority to reopen a permit for cause, and the reviewing authority may 
commence a permit reopening on its own initiative. The reviewing 
authority may not reopen a permit for cause unless it contains a 
material mistake or fails to assure compliance with applicable 
requirements. All requests must be in writing and must contain reasons 
supporting the request.
    (2) If the reviewing authority decides the request is not 
justified, the reviewing authority must send the requestor a brief 
written response giving a reason for the decision. Denials of requests 
for revision, revocation and re-issuance, or termination are not 
subject to public notice, comment, or hearings. Denials by the 
reviewing authority may be informally appealed to the Board by a letter 
briefly setting forth the relevant facts. The Board may direct the 
reviewing authority to begin revision, revocation and re-issuance, or 
termination proceedings under paragraph (e)(3) of this section. The 
appeal must be considered denied if the Board takes no action within 60 
days after receiving it. This informal appeal is, under 42 U.S.C. 307, 
a prerequisite to seeking judicial review of EPA action in denying a 
request for revision, revocation and re-issuance, or termination.
    (3) If the reviewing authority decides the request is justified and 
that cause exists to revise, revoke and reissue or

[[Page 48749]]

terminate a permit, it shall initiate proceedings to reopen the permit.


Sec.  49.173  Administration and delegation of the nonattainment major 
NSR program in Indian country.

    (a) Who administers a nonattainment major NSR Program in Indian 
Country? (1) If the Administrator has approved a TIP that includes a 
major NSR program for stationary sources in nonattainment areas of 
Indian country that meets the requirements of part D of title I of the 
Act and Sec.  51.165 of this chapter, the tribe is the reviewing 
authority and will administer the approved major NSR program under 
tribal law.
    (2) If the Administrator has not approved an implementation plan, 
the Administrator may delegate the authority to assist EPA with 
administration of portions of this Federal nonattainment major NSR 
program implemented under Federal authority to a tribal agency upon 
request, in accordance with the provisions of paragraph (b) of this 
section. If the tribal agency has been granted such delegation, it will 
have the authority to assist EPA according to paragraph (b) of this 
section.
    (3) If the Administrator has not approved an implementation plan or 
granted delegation to a tribal agency, the Administrator is the 
reviewing authority and will directly administer all aspects of this 
Federal nonattainment major NSR program in Indian country under Federal 
authority.
    (b) Delegation of administration of the Federal nonattainment major 
NSR program to tribes. This paragraph (b) establishes the process by 
which the Administrator may delegate authority to a tribal agency, with 
or without signature authority, to assist EPA with administration of 
portions of this Federal nonattainment major NSR program, in accordance 
with the provisions in paragraphs (b)(1) through (8) of this section. 
Any Federal requirements under this program that are administered by 
the delegate tribal agency will be subject to enforcement by EPA under 
Federal law. This section provides for administrative delegation of the 
Federal nonattainment major NSR program and does not affect the 
eligibility criteria under Sec.  49.6 for treatment in the same manner 
as a State.
    (1) Information to be included in the Administrative Delegation 
Request. In order to be delegated authority to assist EPA with 
administration of this FIP permit program for stationary sources, the 
tribal agency must submit a request to the Administrator that:
    (i) Identifies the specific provisions for which delegation is 
requested;
    (ii) Identifies the Indian Reservation or other areas of Indian 
country for which delegation is requested;
    (iii) Includes a statement by the applicant's legal counsel (or 
equivalent official) that includes the following information:
    (A) A statement that the applicant is a tribe recognized by the 
Secretary of the Interior;
    (B) A descriptive statement that is consistent with the type of 
information described in Sec.  49.7(a)(2) demonstrating that the 
applicant is currently carrying out substantial governmental duties and 
powers over a defined area; and
    (C) A description of the laws of the tribe that provide adequate 
authority to administer the Federal rules and provisions for which 
delegation is requested; and
    (iv) Demonstrates that the tribal agency has the technical 
capability and adequate resources to administer the FIP provisions for 
which the delegation is requested.
    (2) Delegation of Partial Administrative Authority Agreement. A 
Delegation of Partial Administrative Authority Agreement (Agreement) 
will set forth the terms and conditions of the delegation, will specify 
the provisions that the delegate tribal agency will be authorized to 
implement on behalf of EPA, and will be entered into by the 
Administrator and the delegate tribal agency. The Agreement will become 
effective upon the date that both the Administrator and the delegate 
tribal agency have signed the Agreement or as otherwise stated in the 
Agreement. Once the delegation becomes effective, the delegate tribal 
agency will be responsible, to the extent specified in the Agreement, 
for assisting EPA with administration of the provisions of the Federal 
nonattainment major NSR program that are subject to the Agreement.
    (3) Publication of notice of the Agreement. The Administrator will 
publish a notice in the Federal Register informing the public of any 
Agreement for a particular area of Indian country. The Administrator 
also will publish the notice in a newspaper of general circulation in 
the area affected by the delegation. In addition, the Administrator 
will mail a copy of the notice to persons on a mailing list developed 
by the Administrator consisting of those persons who have requested to 
be placed on such a mailing list.
    (4) Revision or revocation of an Agreement. An Agreement may be 
modified, amended, or revoked, in part or in whole, by the 
Administrator after consultation with the delegate tribal agency.
    (5) Transmission of information to the Administrator. When 
administration of a portion of the Federal nonattainment major NSR 
program in Indian country that includes receipt of permit application 
materials and preparation of draft permits has been delegated in 
accordance with the provisions of this section, the delegate tribal 
agency must provide to the Administrator a copy of each permit 
application (including any application for permit revision) and each 
draft permit. The applicant may be required by the delegate tribal 
agency to provide a copy of the permit application directly to the 
Administrator. With the Administrator's consent, the delegate tribal 
agency may submit to the Administrator a permit application summary 
form and any relevant portion of the permit application, in place of 
the complete permit application. To the extent practicable, the 
preceding information should be provided in electronic format as 
requested by the Administrator.
    (6) Waiver of information transmission requirements. The 
Administrator may waive the requirements of paragraph (b)(5) of this 
section for any category of stationary sources (including any class, 
type, or size within such category) by transmitting the waiver in 
writing to the delegate tribal agency.
    (7) Retention of records. Where a delegate tribal agency prepares 
draft or final permits or receives applications for permit revisions on 
behalf of EPA, the records for each draft and final permit or 
application for permit revision must be kept by the delegate tribal 
agency for a period not less than 5 years. The delegate tribal agency 
must also submit to the Administrator such information as the 
Administrator may reasonably require to ascertain whether the delegate 
tribal agency is implementing and administering the delegated program 
in compliance with the requirements of the Act and of this program.
    (8) Delegation of signature authority. To receive delegation of 
signature authority, the legal statement submitted by the tribal agency 
pursuant to paragraph (b)(1) of this section must certify that no 
applicable provision of tribal law requires that a major NSR permit be 
issued after a certain time if the delegate tribal agency has failed to 
take action on the application (or includes any other similar provision 
providing for default issuance of a permit).
    (c) Are there any non-delegable elements of the Federal 
nonattainment major NSR program in Indian country?

[[Page 48750]]

The following authorities cannot be delegated outside of EPA:
    (1) The Administrator's authority to object to the issuance of a 
major NSR permit.
    (2) The Administrator's authority to enforce, revoke, or terminate 
permits issued pursuant to this program.
    (d) How will EPA transition its authority to an approved 
nonattainment major NSR program? (1) The Administrator will suspend the 
issuance of nonattainment major NSR permits under this program promptly 
upon publication of notice of approval of an implementation plan with a 
major NSR permit program for nonattainment areas.
    (2) The Administrator may retain jurisdiction over the permits for 
which the administrative or judicial review process is not complete and 
will address this issue in the notice of program approval.
    (3) After approval of a program for issuing nonattainment major NSR 
permits and the suspension of issuance of nonattainment major NSR 
permits by the Administrator, the Administrator will continue to 
administer nonattainment major NSR permits until permits are issued 
under the approved implementation plan program.


Sec. Sec.  49.174-49.175  [Reserved]

PART 51--[AMENDED]

    4. The authority citation for part 51 continues to read as follows:

    Authority: 23 U.S.C. 101; 42 U.S.C. 7401-7671q.

Appendix S to Part 51--[Amended]

    5. Appendix S to Part 51 is amended by revising paragraph II.B to 
read as follows:

Appendix S to Part 51--Emission Offset Interpretative Ruling

* * * * *
    II. * * *
    B. Review of all sources for emission limitation compliance. The 
reviewing authority must examine each proposed major new source and 
proposed major modification \1\ to determine if such a source will 
meet all applicable emission requirements in the SIP, any applicable 
new source performance standard in 40 CFR part 60, or any national 
emission standard for hazardous air pollutants in 40 CFR part 61 or 
part 63. If the reviewing authority determines that the proposed 
major new source cannot meet the applicable emission requirements, 
the permit to construct must be denied.
---------------------------------------------------------------------------

    \1\ Hereafter the term source will be used to denote both any 
source and any modification.
---------------------------------------------------------------------------

* * * * *
[FR Doc. 06-6926 Filed 8-18-06; 8:45 am]
BILLING CODE 6560-50-P


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