1 Summary of Discussion from 4/27/2010 Section 112(j) Meeting with AHFA (American Home Furnishings Alliance) Date of Meeting : April 27 , 20 10 Time: 10:00 am – 1 1 : 0 0 am Purpose: The purpose of the meeting was for AHFA to discuss their questions and conce rns about the proposed section 112(j) amendments
. Participants: Rick Colyer, EPA/OAPQS Lisa Conner, EPA/OAQPS Beth Friedman, EC/R (EPA Contractor) Eric Ginsburg, EPA/OAQPS Bill Huang, EC/R (EPA Contractor) Shiela Igoe, EPA/OGC Dean Kaiser, Stratus Envir onmental Bill Lane, Kilpatrick Stockton LLP Alan McConnell, Kilpatrick Stockton LLP Bill Perdue, AHFA Summary  AHFA provided background on the trade association and their main concern, which is the status of the proposed boiler MACT and how implementation of that rule will affect current (or planned) section 112(j) permits
. o AHFA m embership ranges over the U .S., with concentrations in several states such as California, and Wisconsin

 EPA provided some background on the section 112(j) process. EPA had succ essfully promulgated several years ago all of the standards required to avoid trigger ing the section 112(j) “hammer,” but the recent vacaturs of some standards reinstated the need for the section 112(j) provisions. EPA’s position is that vacatur of a rul e is equivalent to a failure to promulgate a rule. The purpose of the proposed section 112(j) amendments is to address those source categories affected by vacatur s by clarifying their section 112(j) obligations and to create a backstop in the case of any future vacaturs.

 A HFA ask ed about the time table for implementing section 112(j). o EPA noted that section 112(j) does not apply after a MACT standard is promulgated.2

o Of the 4 vacaturs, the Boiler MACT will be the first to be promulgated , in December 2010 . Section 112(j) also is expected to come out around the end of the year, and it is likely that the Boiler MACT will be finalized before the section 112(j) amendments are promulgated. Therefore, boiler sources would not have to file permit applications be cause they would be subject to a MACT standard. o With the other three vacaturs, the MACT standards should also be promulgated before any section 112(j) permits would be issued
. o Effectively, section 112(j) will only affect future vacaturs. o AFHA urged EPA t o avoid any unnecessary overlaps in rulemaking that result in unneeded section 112(j) compliance obligations.

 The group discussed the status of state efforts to address the section 112(j) provisions of the Clean Air Act. o North Carolina has a n active secti on 112(j) program. o AHFA expressed concern with North Carolina’s position that once a new boiler standard is pro posed , NC will make the case
- by
- case section 112(j) MACT consistent with the proposed rule. o EPA clarified that it defers to the state in terms of determining case
- by
- case MACT and that its main focus is that the state correctly follows the section 112(j) process. o States are free to follow section 112(j) guidance from 1994 that says they should consider any proposed regulations by EPA in developin g the MACT, and use any available information, as defined in the section 112(j) rule
.

 AHFA said that current section 112(j) MACT determinations in NC are based on the original boiler MACT, with a health based compliance option. They are concerned that i f NC changes the basis for the MACT determination, that companies could be subject to different compliance options. They were also concerned that the state would seek to accelerate adoption of the Boiler MACT for sources that already have section 112(j) p ermits.

 AHFA’s bottom
- line : They want certainty, not avoidance. o Industry feels there is an advantage to the environment by putting section 112(j) permits in place with defined compliance obligations, in case promulgation of the Boiler standard is delay ed. o All AHFA members were encouraged to submit Part 1 applications after the vacaturs, but very few states have taken action. o The EPA representatives were not aware of anyone filing an intent to sue on failure to act on section 112(j).