### STAFF REPORT FOR PROPOSED RULE REVISIONS

Rule 213: Storage of Gasoline Products (Repeal) Rule 214: Phase I Vapor Recovery System Requirement s (Amend) Rule 228: Surface Coating of Metal Parts and Produ cts (Amend)

Prepared by Northern Sierra AQMD Staff, March, 2011

Date for Public Hearing: April 25, 2011 (alternativ ely May 23, 2011 in case of April meeting cancellation) Date for Rule Adoption: Same as Public Hearing (Unl ess comments received necessitate significant modification)

INTRODUCTION The Northern Sierra Air Quality Management District (NSAQMD) is proposing to combine Rules 213 and 214, and to amend Rule 228 in partial fulfillment of requirements under the Clean Air Act (CAA) as amended 1990. Rul e 213 is proposed to be repealed at the time its requirements are incorporated into Rul e 214.

Effective June 15, 2004, Western Nevada County was designated under the CAA as a

Basic Non-attainment area for the national 1997 8-h our ozone ambient air quality standard. The Basic classification was subsequentl y remanded nationwide, and EPA has indicated that in May, 2011, Western Nevada County will be proposed for reclassification

as a Moderate Non-attainment area.

The California Air Resources Board (ARB) has submit ted to EPA a request for a Clean Data Finding for Western Nevada County (based on mo nitors indicating ozone concentrations below the federal standard). The N SAQMD anticipates that EPA will approve the Clean Data Finding, which would suspend some of the planning requirements in the CAA, but would not suspend requ irements for Reasonably Available Control Technology (RACT) for ozone precursors.

The RACT requirement is meant to ensure that ozone non-attainment areas are taking reasonable steps to minimize the emission of ozone precursors, which are oxides of nitrogen (NOx) and volatile organic compounds (VOCs ). In order to assist areas in identifying and implementing RACT, EPA issues Contr ol Techniques Guidelines (CTGs) for specific source categories. These serve to def ine RACT, and each non-attainment area must implement measures laid out in the CTGs, or the equivalent, if there are sources in the area to which they apply. The rule changes are being proposed in order to meet federal requirements for inclusion in Californ ia’s State Implementation Plan (SIP), as required under the CAA. Failure to adopt rules fully satisfying RACT can result in federal sanctions including withholding of federal highway dollars and increased emission offset requirements for local, major emiss ion sources.

The NSAQMD has worked with EPA and ARB in the devel opment of the proposed rule changes, and both agencies have preliminarily appro ved the changes.SUMMARY OF PROPOSED CHANGES

Rule 213: Storage of Gasoline Products (Repeal)

In 2010, EPA reviewed Rule 213, which was submitted for inclusion in the SIP, and concluded that it lacks adequate testing and record keeping requirements for full approval of the Rule into the SIP. Rule 214, however, has a dequate testing and recordkeeping requirements, and applies to the same types of sour ces (those subject to Phase I Vapor Recovery). Thus, the NSAQMD proposes to simply mov e all provisions of Rule 213 into Rule 214, at EPA’s suggestion, and to repeal Rule 2 13.

Rule 213 History: Adopted November 11, 1991; amended March 26, 2007.

Rule 214: Phase I Vapor Recovery Requirements (Ame nd)

In 2010, EPA reviewed Rule 214, which was submitted for inclusion in the SIP. Along with the suggestion of moving the requirements of R ule 213 into Rule 214 (discussed above), EPA suggested the following additional modi fications to Rule 214, which have been included in the proposed rule amendment.

EPA recommended merging the definitions of “Vapor Recovery Equipment Defects List” and “VRED List.” Accordingly, the definition of the former was deleted and the VRED List definition was modified to read, “VRED Li st: Vapor Recovery Equipment

Defects List. A list of defects that CARB has iden tified as substantially impairing the efficiency of the vapor recovery system, incorporat ed by reference in Title 17 CCR Section 94006, pursuant to California Health & Safe ty Code Section 41960.2(c).”

EPA recommended adding the following to Rule 214, a t the end of Section 3.1: “...and the transfer vehicle is CARB certified to be compat ible with the Phase I stationary storage tank CARB certification.”

EPA reviewed the proposed changes and sent the NSAQ MD an e-mail stating that they seemed fine. ARB reviewed the proposed changes and had no comment. None of the changes have any effect on emissions.

Rule 214 History: Adopted December 15, 1988; amended March 26, 2007; amended February 22, 2010.

Rule 228: Surface Coating of Metal Parts and Produ cts (Amend)

In 2010, EPA reviewed Rule 228, which was submitted for inclusion in the SIP. EPA determined that the Rule was not fully approvable i nto the SIP, mainly because itcontained a reference to another rule (Rule 229) wh ich has not been submitted for

inclusion in the SIP. A number of additional chang es were recommended.

Rule 228 is being revised to remove the existing re ference to Rule 229 in subsection 3.4.2.d., which reads, “d. Remote reservoir cold cl eaner operated in conformance with Rule 229.” In the proposed revision, this subsecti on was merely removed and the Rule does not address remote reservoir cold cleaner oper ation. The only existing facility in the NSAQMD that coats metal parts or products and is su bject to the provisions of Rule 228 (due to emissions greater than 15 lbs./day of VOCs) is Serra Corporation, on Bitney Springs Road. The NSAQMD contacted Serra Corporati on and confirmed that the facility does not use a remote reservoir cold clean er, so the proposed revision will have no effect on the company’s current or planned opera tions. Likewise, this change has no

effect on emissions.

Other changes in the proposed rule revision (at EPA ’s formal recommendation in order to make the Rule approvable into the SIP) include a ne w effective date of July 1, 2011; improvements to the Definitions section; minor chan ges to improve enforceability; the addition and update of full test method titles; and the addition of “etching fillers” to the acid content measurement section (5.5). None of th ese changes have any effect on

emissions.

Rule History: Originally adopted November 27, 2006; amended Febr uary 22, 2010.

AUTHORITY AND RULE ADOPTION REQUIREMENTS

The District is authorized to regulate sources of a ir pollutants under the California Health and Safety Code (HSC) §40001 and §40702. HSC §4150 8 allows local air districts to adopt stricter standards than the State, but not mo re relaxed standards.

HSC §40728.5 requires a socioeconomic analysis for proposed rules in districts having a population greater than 500,000 persons. The NSAQM D’s population is approximately 120,000 so this requirement does not apply.

California Health and Safety Code (HSC) §40703 requ ires that all air quality districts consider and make public findings relating to the c ost effectiveness of implementing an

emission control measure. No cost is associated wi th implementing the proposed rule changes.

These rules are exempt from the requirements of CEQ A per Class 8 (§15308) of the CEQA guidelines.

The California Health and Safety Code requires air districts to comply with a rule adoption protocol as set forth in §40727 of the Cod e. There are six findings the District must make when developing, amending or repealing a rule:FINDINGS DEFINITION REFERENCE

Authority A provision of law or of a state or

federal regulation permits or requires the regional agency to adopt, amend, or repeal the regulation. HSC Sections 40001, 40702, and

41511.

Necessity A need exists for the regulation, or

its amendment, or appeal, as demonstrated by the record or rule making authority. It is necessary for the NSAQMD to

revise these rules in order to comply with the Clean Air Act and thereby avoid federal sanctions. Further, the source categories towhich they apply exist in the nonattainment area. Clarity The regulation is written or

displayed so that its meaning can be easily understood by the persons directly affected by it. The proposed rules are written in such a manner that they can be easily understood by affected sources, and their subsections are descriptively titled. Consistency The regulation is in harmony with,

and not in conflict with or contradictory to, existing statutes, court decisions, or state or federal regulation. The NSAQMD has determined

these rules are consistent with State and federal regulations and do not conflict with existing statutes or

court decisions.

Nonduplication A regulation does not impose the

same requirements as an existing state or federal regulation unless a district finds that the requirements

are necessary or proper to execute the powers and duties granted to, and imposed upon, a district. The NSAQMD has evaluated the proposed rule revisions in light of existing rules and has found no duplication.

Reference Any statute, court decision, or other

provision of law that the district implements, interprets, or makes specific by adopting, amending, or repealing a regulation. These rule revisions are being proposed consistent with the requirements of CAA Title 1, Part D, Section 172(c)(1) and 40 CFR Part 51.912(c).

RECOMMENDATION

Approval by the Northern Sierra Air Quality Managem ent District Board of Directors of the proposed rule revisions and findings herein.