OAR Box 1818 

Prepped by Ollie Stewart 

Document Number: 

17) ll-C-14 

Docket Number: 

A-87-11 

Printed 11/6/2008 3:12:42 PM Sheet 17 of 79 

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ISK ^ UNITED STATES ENVIRONMENTAL PROTECTION AGENCY 

HINGTON. D.C. 

Ml 2 9 1987 

XPBO ^ WASHINGTON. D.C. 20450 

THE ADMINISTRATOR 

Honorable John D. Dinaell 

Chairman, Subcommittee 

on Oversight and Investigations 

Committee on Energy and Commerce 

House of Representatives 

Washington D.C. 20515 

Dear Mr. Chairman: 

I am writing in r-^ponse to your letter of May 7, 1987, 

In that letter., you asked questions relating to EPA's Red 

Border process, the openness of EPA's regulatory process, 

and EPA's use of contractors. Enclosed are responses to 

your questions. 

Thank you for your interest in these matters. 

Sincerely, 

£©© & Ihouia; 

Lee M. Thomas 

Enclosure 
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V 

Concurrent "Red BorderVOMB Review of EPA Gas Marketing Proposals 

Your letter of May 7 questioned whether submittal of the draft notices of 

proposed rulemaking (NPRMs) for gasoline refueling and volatility controls for 

Red Border review concurrently with OMB review was consistent with Executive 

Order 12291 and section 307(d) of the Clean Air Act. As I stated in my letter 

of April 24, concurrent OMB and Red Border review of the NPRMs is fully consistent 

with Executive Order 12291. Section 3(c)(2) of that order requires that major 

proposed rulemaking notices be submitted to OMB for review at least 60 days 

prior to publication. As you point out, the executive order does not require 

that the draft proposal reviewed by OMB be the same draft reviewed by EPA's 

upper management during Red Border review. However, nothing in the order in 

any way precludes EPA management and 0M3 from reviewing the same draft concurrently. 

Such a procedure falls within the discretion implicitly conferred on each 

agency by the executive order and has been used on many occasions by EPA. 

Moreover, a primary purpose of section 3(c)(2) of the order is to give OMB 

adequate time to review ma^or proposed rules before the Agency puts the proposal 

in finished form for publication. Since the two proposals in question are 

extremely lengthy and complex, providing OMB copies of these NPRM's as soon as 

they were sufficiently refined to warrant such review was completely consistent 

with that purpose. As I stated in my letter of April 24, I am confident that 

these notices had been sufficiently reviewed and refined within EPA prior to 

Red Border review and thus that OMB review of those drafts is appropriate. 

Similarly, I believe that the procedure EPA is following is entirely 

consistent with the requirements of section 307(d)(4)(B)(ii) of the Clean Air 

Act. As you know, that section specifically requires that the drafts of 

proposed rules submitted to OMB for review prior to proposal, all documents 

accompanying such drafts, "all written comments thereon . . . and all written 

responses [by EPA] to such written comments" be placed in the appropriate 

rulemaking docket no later than the date of proposal of the rules. I assure 

you that EPA will comply fully with this requirement when the gasoline refueling 

and volatility proposals are ready to be published, and that both draft NPRM's 

and any accompanying documents provided to OMB, and all written comments and 

written responses concerning those notices *_/ will be placed in the appropriate 

public dockets at that time. Of course, as you request, we also will be happy 

to provide all such documents to the Subcommittee at that time. 

In accordance with section 307(d)(4)(B)(ii), any written comments received 

from other agencies (including the Department of Transportation) regarding 

the draft proposals, and any written EPA responses, will also be placed 

in the public dockets for these proposals. 
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I do not agree, however, with your suggestion that concurrent Red Border 

and OMB review of these draft proposals is somehow inconsistent with the 

•spirit or purpose'of section 307(d)(4)(B)(ii). As you know, that provision 

does not expressly preclude such a procedure. In fact, it does not address 

in any way the issue of whether EPA must (as you suggest) complete its 

internal review and provide "finished" or "completed" copies of such notices 

and related documents. Section 307(d)(4)(B)(ii) only requires that EPA put 

any drafts of proposed rules and related documents provided to OMB (and any 

written comments and responses), without regard to their state of "completeness," 

in the appropriate docket. 

You suggest, however, that the purpose of section 307(d)(4)(B)(ii) is 

to allow Congress or the public to be able to tell whether any differences 

between the finished proposal and the draft provided to OMB are due to EPA's 

internal review or to suggestions from 0M3 (or another agency) and that 

concurrent review would thwart that purpose, we read the statute differently. 

Section 307(d)(4)(B)(ii) requires only that certain written interagency 

review materials (if any such documents exist) be placed in the docket. It 

does not require EPA to create a record to explain or document when and why 

any changes in a draft proposed rulemaking notice were made. Rather, that 

provision leaves it to the Agency's discretion to decide how and when to 

conduct any interagency re"iew, subject only to the requirement that certain 

written materials be docketed. I believe that it is a reasonable exercise of 

that discretion, in cases such as these, for the Agency to begin the review 

process by sending a Red Border draft to OMB. 

Since section 307(d)(4)(B)(ii) neither explicitly nor implicitly requires 

that all changes in a finished proposal be identified as having been suggested 

by EPA, OMB, or any other agency, I do not believe that the concurrent review 

practiced here and on other occasions is inconsistent with section 307(d)(4)(B)(ii) 

or its purposes. Of course,-my staff and I will be glad to cooperate with 

GAO in the review that you have requested of the legal and policy issues raised 

in your letter. 

Finally, you refer in your letter to two documents referenced in the 

gasoline refueling draft proposal (references 10 and 18) and suggest that 

these are "incomplete" documents and that they thus render the draft proposal 

incomplete. As discussed above, section 307(d)(4)(B)(ii) does not require 

that draft proposals submitted to OMB pr documents referenced therein be 

fully completed at that time. In any event, item no. 10 (draft "OGC Attachment") 

is merely a longer, more detailed version of a condensed discussion in the 

draft refueling notice submitted for Red Border and OMB review. Thus, the 

draft NPRM is complete with respect to that issue. (A finished version of the 

longer discussion will be placed in the public docket for this rulemaking, as 

the draft NPRM states, shortly). Item no. 18 (draft "Summary and Analysis 

of Comments on Draft Gasoline Marketing Study") is in the process of being 

reviewed within EPA and will be released no later than the date of proposal. 
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In any event, completion of that ancillary document was not essential to 

either EPA or OMB review since the draft proposal contains all the information necessary for full and meaningful review within EPA and OMB. 

Public Comments on the Gas Marketing Activity 

In your letter of May 7, you expressed your concern that EPA "has not 

done an adequate job in expressly seeking comments" on important matters 

relating to the gas marketing question. As you know, the Agency has yet to 

propose any new action with regard to gas marketing operations. Despite the 

fact that we are in the pre-proposal stage and are not obligated to request 

comments from outside groups, we have had extensive communications, and have 

been extremely open with a wide array of interests which might be affected 

by any EPA decision. 

EPA recognizes the significance of this issue, and, as I stated in my 

April 24 response to your March 25 letter, "I believe that we have provided 

very extensive information concerning our study of both the refueling and 

volatility issues, with a level of detail and depth which would normally be 

confined within the formal rulemaking process." At such time as that 

formal rulemaking process begins, we will provide any additional relevant 

material which has not already been made public, and provide an additional 

opportunity for all interested parties to comment. 

Request for Information on EPA use of Contractors 

Finally, in your letter of May 7 you asked for extensive information 

on EPA's use of contractors in several air-related areas. We are attempting 

to assemble the information that you requested, and, as discussed with your 

staff, we will try to provide you with an interim summary within the next 

few weeks.