EPA

United States
Environmental Protection
Agency

Office of Transportation EPA420-F-04-018
and Air Quality August 2004

Regulatory
Announcement

Proposed Rule to Extend California
Enforcement Exemptions for
Reformulated Gasoline to California
Phase 3 Gasoline

The U.S. Environmental Protection Agency (EPA) is proposing to
exempt refiners, importers, and blenders of gasoline subject to the
State of California’s Phase 3 reformulated gasoline (CaRFG3)
regulations from certain enforcement provisions in the Federal
reformulated gasoline (RFG) regulations. We are proposing this action
because we believe that gasoline complying with the CaRFG3
regulations will provide emissions benefits equivalent to Federal Phase
1! RFG and because California's compliance and enforcement program
will in practice be significantly rigorous to assure that the standards are
met. The enforcement exemptions, when finalized, will ensure that
California refiners, importers and blenders do not have to comply with
duplicative Federal and state regulations and will thereby reduce costs
to regulated industry without any negative environmental impact.

Background

Section 211(k) of the Federal Clean Air Act (the Act) directs EPA to
establish requirements for RFG to be used in specified ozone
nonattainment areas, as well as “anti-dumping” requirements for conven-
tional gasoline used in the rest of the country. The areas covered by the
Federal RFG program in California are San Joaquin Valley, Los Angeles,
San Diego, and Sacramento. Since the federal RFG regulations were
promulgated, California refiners and importers have been continuously
exempted from certain enforcement-related requirements such as


recordkeeping and reporting, and certain sampling and testing requirements. The reason
we granted enforcement exemptions to California is because we determined that Califor-
nia RFG (called “California Phase 2 gasoline”) would have comparable standards to
federal RFG and because California has sufficiently stringent enforcement to ensure
program benefits are met. The enforcement exemptions are limited and reasonable provi-
sions that permit parties subject to the California RFG regulations to avoid costly adher-
ence to duplicative federal and state enforcement provisions.

California recently promulgated its new California Phase 3 (CaRFG3) regulations, which
take the place of the current California Phase 2 regulations. We have evaluated those
regulations and have concluded that the criteria for enforcement exemptions mentioned
above apply for the new regulations as well. For that reason, we are issuing a proposed
rule to extend the federal enforcement exemptions to these new California regulations.
Since the CaRFG3 regulations became effective on December 31, 2003, affected regu-
lated parties are covered by a grant of enforcement discretion that bridges the time until
EPA issues a final rule.

How will the regulations affect industry?

Refiners, importers and blenders of California gasoline who are subject to the CaRFG3

regulations are affected by this rule. This rule is expected to reduce regulatory burdens

associated with duplicative provisions in the Federal RFG and CaRFG3 regulations and
should, therefore, result in a cost savings to industry.

What are the health and environmental benefits?

This proposed rule is not expected to have any adverse impact because we believe that
the CaRFG3 standards are equivalent to the Federal RFG standards and because Califor-
nia has a rigorous enforcement program.

Where can | find more information?
You can access documents related to Federal RFG and the California enforcement ex-
emptions at:

www.epa.gov/otaq/rfg_regs.htm#enforcement
For more information on this rule, please contact Anne Pastorkovich at:

U.S, Environmental Protection Agency

Office of Transportation and Air Quality (6406J)
1200 Pennsylvania Avenue, NW

Washington, DC 20460

(202) 343-9623

E-mail: pastorkovich.anne-marie@epa.gov

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