Federal Register / Vol. 75, No. 19 / Friday, January 29, 2010 / Proposed Rules 4745 

permitting rules as necessary to amend the SIP 

consistent with the provisions of Senate Bill 700. 

IV. Public Comment and Final Action 

Under CAA section 301(a)(1) and for 

the reasons discussed above, EPA is 

proposing to clarify that the statutory 

provisions and other legal documents 

submitted in connection with the legal 

authority chapter of the original 1972 

California SIP were superseded by 

EPA’s approval of a revised legal 

authority chapter in 1980 (and codified 

at 40 CFR 52.220(c)(48)). To 

memorialize EPA’s interpretation of the 

effect of the 1980 final rule on the 

earlier submitted and approved 

statutory provisions and other legal 

documents, EPA is proposing to revise 

40 CFR 52.220(b)(12)(i) to read as 

follows: 

‘‘(i) Previously approved on May 31, 1972 

and deleted without replacement, effective 

September 10, 1980, chapter 7 of part I and 

all of the statutory provisions and other legal 

documents contained in appendix II to 

chapter 7 (Legal Considerations).’’ 

EPA is soliciting public comments on 

the issues discussed in this document 

and will accept comments for the next 

30 days. These comments will be 

considered before taking final action. 

V. Statutory and Executive Order 

Reviews 

Under the Clean Air Act, the 

Administrator is required to approve a 

SIP submission that complies with the 

provisions of the Act and applicable 

Federal regulations. 42 U.S.C. 7410(k); 

40 CFR 52.02(a). Thus, in reviewing SIP 

submissions, EPA’s role is to approve 

state choices, provided that they meet 

the criteria of the Clean Air Act. 

Accordingly, this action merely 

proposes to clarify the effect of a 

previous approval by EPA of a state 

submittal as meeting Federal 

requirements and does not impose 

additional requirements beyond those 

imposed by state law. For that reason, 

this proposed action: 

• Is not a ‘‘significant regulatory 

action’’ subject to review by the Office 

of Management and Budget under 

Executive Order 12866 (58 FR 51735, 

October 4, 1993); 

• Does not impose an information 

collection burden under the provisions 

of the Paperwork Reduction Act (44 

U.S.C. 3501 et seq.); 

• Is certified as not having a 

significant economic impact on a 

substantial number of small entities 

under the Regulatory Flexibility Act (5 

U.S.C. 601 et seq.); 

• Does not contain any unfunded 

mandate or significantly or uniquely 

affect small governments, as described 

in the Unfunded Mandates Reform Act 

of 1995 (Pub. L. 104–4); 

• Does not have Federalism 

implications as specified in Executive 

Order 13132 (64 FR 43255, August 10, 

1999); 

• Is not an economically significant 

regulatory action based on health or 

safety risks subject to Executive Order 

13045 (62 FR 19885, April 23, 1997); 

• Is not a significant regulatory action 

subject to Executive Order 13211 (66 FR 

28355, May 22, 2001); 

• Is not subject to requirements of 

Section 12(d) of the National 

Technology Transfer and Advancement 

Act of 1995 (15 U.S.C. 272 note) because 

application of those requirements would 

be inconsistent with the Clean Air Act; 

and 

• Does not provide EPA with the 

discretionary authority to address, as 

appropriate, disproportionate human 

health or environmental effects, using 

practicable and legally permissible 

methods, under Executive Order 12898 

(59 FR 7629, February 16, 1994). 

In addition, this proposed rule does 

not have tribal implications as specified 

by Executive Order 13175 (65 FR 67249, 

November 9, 2000), because the SIP is 

not approved to apply in Indian country 

located in the state, and EPA notes that 

it will not impose substantial direct 

costs on tribal governments or preempt 

tribal law. 

List of Subjects in 40 CFR Part 52 

Environmental protection, Air 

pollution control, Intergovernmental 

relations, Oxides of nitrogen, Ozone, 

Reporting and recordkeeping 

requirements, Volatile organic 

compounds. 

Accordingly, 40 CFR Part 52 is 

proposed to be amended as follows: 

PART 52—[AMENDED] 

1. The authority citation for part 52 

continues to read as follows: 

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

2. Section 52.220 is amended by 

revising paragraph (b)(12)(i) to read as 

follows: 

§ 52.220 Identification of plan. 

* * * * * 

(b) * * * 

(12) * * * 

(i) Previously approved on May 31, 

1972 and deleted without replacement, 

effective September 10, 1980, chapter 7 

of part I and all of the statutory 

provisions and other legal documents 

contained in appendix II to chapter 7 

(Legal Considerations). 

* * * * * 

Dated: January 21, 2010. 

Jared Blumenfeld, 

Regional Administrator, Region IX. 

[FR Doc. 2010–1839 Filed 1–28–10; 8:45 am] 

BILLING CODE 6560–50–P 

ENVIRONMENTAL PROTECTION 

AGENCY 

40 CFR Part 52 

[EPA–R09–OAR–2010–0062; FRL–9107–5] 

Approval and Promulgation of 

Implementation Plans, State of 

California, San Joaquin Valley Unified 

Air Pollution Control District, New 

Source Review 

AGENCY: Environmental Protection 

Agency (EPA). 

ACTION: Proposed rule. 

SUMMARY: Under section 110(k)(6) of the 

Clean Air Act, EPA is proposing to 

correct our May 2004 final approval of 

revisions to the San Joaquin Valley 

Unified Air Pollution Control District 

portion of the California State 

Implementation Plan. EPA is also 

proposing to take action on three 

amended District rules, one of which 

was submitted on March 7, 2008 and the 

other two of which were submitted on 

March 17, 2009. Two of the submitted 

rules reflect revisions to approved 

District rules that provide for review of 

new and modified stationary sources 

(‘‘new source review’’ or NSR) within 

the District, and the third reflects 

revisions to an approved District rule 

that provides a mechanism by which 

existing stationary sources may be 

exempt from the requirement to secure 

a Federally-mandated operating permit. 

The NSR rule revisions relate to 

exemptions from permitting and from 

offsets for certain agricultural 

operations, to the establishment of NSR 

applicability and offset thresholds 

consistent with a classification of 

‘‘extreme’’ nonattainment for the ozone 

standard, and to the implementation of 

EPA’s NSR Reform Rules. With respect 

to the revised District NSR rules, EPA is 

proposing a limited approval and 

limited disapproval because, although 

the changes would strengthen the SIP, 

there are deficiencies in enforceability 

that prevent full approval. With respect 

to the operating permit rule, EPA is 

proposing a full approval. Lastly, EPA is 

proposing to rescind certain obsolete 

permitting requirements from the 

District portion of the California plan. 

If EPA were to finalize the limited 

approval and limited disapproval 

action, as proposed, then a sanctions 

clock, and EPA’s obligation to 


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4746 Federal Register / Vol. 75, No. 19 / Friday, January 29, 2010 / Proposed Rules 

1The San Joaquin Valley includes all of San 

Joaquin, Stanislaus, Merced, Madera, Fresno, Kings 

and Tulare counties, and the western half of Kern 

County, in the State of California. The San Joaquin 

Valley is designated as a nonattainment area for the 

1997 8-hour ozone national ambient air quality 

standard (NAAQS) and the 1997 fine particulate 

matter (PM2.5) NAAQS and is designated as 

attainment or unclassifiable for the other NAAQS. 

See 40 CFR 81.303. The area is further classified as 

‘‘serious’’ for the 8-hour ozone NAAQS, but the State 

of California has submitted a request to reclassify 

the area to ‘‘extreme.’’ See 74 FR 43654 (August 27, 

2009) for EPA’s proposed approval of the State’s 

reclassification request. The San Joaquin Valley was 

further classified as an ‘‘extreme’’ area for the nowrevoked 1-hour ozone NAAQS when EPA 

designated the area with respect to the 8-hour ozone 

NAAQS. 

promulgate a Federal implementation 

plan, would be triggered because certain 

revisions to the District rules that are 

the subject of this action are required 

under anti-backsliding principles 

established for the transition from the 

1-hour to the 8-hour ozone standard. 

DATES: Any comments must arrive by 

March 1, 2010. 

ADDRESSES: Submit comments, 

identified by docket number EPA–R09– 

OAR–2010–0062, by one of the 

following methods: 

• Federal eRulemaking Portal: http:// 

www.regulations.gov. Follow the on-line 

instructions. 

• E-mail: R9airpermits@epa.gov. 

• Mail or deliver: Gerardo Rios (Air– 

3), U.S. Environmental Protection 

Agency Region IX, 75 Hawthorne Street, 

San Francisco, CA 94105. 

Instructions: All comments 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 

Confidential Business Information (CBI) 

or other information whose disclosure is 

restricted by statute. Information that 

you consider CBI or otherwise protected 

should be clearly identified as such and 

should not be submitted through 

http://www.regulations.gov or e-mail. 

http://www.regulations.gov is an 

‘‘anonymous access’’ system, and EPA 

will not know your identity or contact 

information unless you provide it in the 

body of your comment. If you send email directly to EPA, your e-mail 

address will be automatically captured 

and included as part of the public 

comment. 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. 

Docket: The index to the docket for 

this action is available electronically at 

http://www.regulations.gov and in hard 

copy at EPA Region IX, 75 Hawthorne 

Street, San Francisco, California. While 

all documents in the docket are listed in 

the index, some information may be 

publicly available only at the hard copy 

location (e.g., copyrighted material), and 

some may not be publicly available in 

either location (e.g., CBI). To inspect the 

hard copy materials, please schedule an 

appointment during normal business 

hours with the contact listed in the FOR

FURTHER INFORMATION CONTACT section 

below. 

FOR FURTHER INFORMATION CONTACT: 

Laura Yannayon, Permits Office (AIR– 

3), U.S. Environmental Protection 

Agency, Region IX, (415) 972–3534, 

yannayon.laura@epa.gov. 

SUPPLEMENTARY INFORMATION: 

Throughout this document, ‘‘we,’’ ‘‘us’’ 

and ‘‘our’’ refer to EPA. 

Table of Contents 

I. Regulatory Context 

II. Correction of EPA’s May 2004 Final 

Approval 

A. CAA Legal Authority 

B. Background on District NSR Rules 2020 

and 2201 and Related EPA Actions 

C. Correction of Erroneous Final Approval 

III. The State’s Submittals of Revised District 

Rules 

A. What rules did the State submit? 

B. Are there other versions of these rules? 

C. What are the purposes for revisions to 

these rules? 

IV. EPA’s Evaluation and Action on the Rule 

Revisions 

A. How is EPA evaluating the rules? 

B. Do the rules meet the evaluation 

criteria? 

1. Regulatory Context 

2. Minor Source NSR Permitting 

Requirements 

3. ‘‘Extreme’’ Ozone Area NSR 

Requirements 

4. EPA’s NSR Reform Rules 

5. Other Changes to District Rules 2020 and 

2201 

6. Enforceability Considerations 

7. Federally Enforceable Restriction on 

Potential To Emit 

8. CAA Section 110(l) 

9. Conclusion and Proposed Action on 

Submitted Rules 

V. Deletion of Obsolete Conditions on SIP 

Approvals 

VI. Proposed Action and Opportunity for 

Public Comment 

VII. Statutory and Executive Order Reviews 

I. Regulatory Context 

On February 20, 2008 (73 FR 9260), 

under sections 110(k)(2) and 110(k)(6) of 

the Clean Air Act (CAA or ‘‘Act’’), we 

proposed to correct our May 2004 final 

approval of revisions to the San Joaquin 

Valley Unified Air Pollution Control 

District (‘‘SJVUAPCD’’ or ‘‘District’’) 

portion of the California State 

Implementation Plan (‘‘SIP’’) and to 

approve revisions to two District rules 

submitted to EPA by the California Air 

Resources Board (CARB) on December 

29, 2006.1 The specific provisions 

proposed for approval included 

paragraph 6.20 of District Rule 2020 

(‘‘Exemptions’’) and paragraph 4.6.9 of 

District Rule 2201 (‘‘New and Modified 

Stationary Source Review Rule’’). These 

provisions relate to review and 

permitting of new or modified 

stationary sources (‘‘NSR’’) specifically 

in connection with agricultural sources. 

We received substantive comments on 

our proposed rule, and, since 

publication of the February 2008 

proposed rule, the District has adopted 

further revisions to Rules 2020 and 2201 

that have been submitted to EPA for 

approval by CARB. The further 

amended District rules carry forward the 

revisions submitted on December 29, 

2006 but reflect more recent changes by 

the District as well. In light of the 

comments on our February 2008 

proposed rule, and the more recent 

submittals of District Rules 2020 and 

2201, we have decided not to take any 

further action on our February 2008 

proposed rule, but rather to propose 

action anew. Published in today’s 

Federal Register is a withdrawal of our 

February 20, 2008 proposed rule. 

II. Correction of EPA’s May 2004 Final 

Approval 

A. CAA Legal Authority 

Section 110(k)(6) of the Clean Air Act, 

as amended in 1990, provides: 

‘‘Whenever the Administrator 

determines that the Administrator’s 

action approving, disapproving, or 

promulgating any plan or plan revision 

(or part thereof), area designation, 

redesignation, classification or 

reclassification was in error, the 

Administrator may in the same manner 

as the approval, disapproval, or 

promulgation revise such action as 

appropriate without requiring any 

further submission from the State. Such 

determination and the basis thereof 

shall be provided to the State and the 

public.’’ 

We interpret this provision to 

authorize the Agency to make 

corrections to a promulgated regulation 

when it is shown to our satisfaction (or 

we discover) that (1) we clearly erred by 

failing to consider or by inappropriately 

considering information made available 

to EPA at the time of the promulgation, 

or the information made available at the 

time of promulgation is subsequently 

demonstrated to have been clearly 

inadequate, and (2) other information 

persuasively supports a change in the 

regulation. See 71 FR 75690, at 75693 

(December 18, 2006); 57 FR 56762, at 

56763 (November 30, 1992). 


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2Rules 2020 and 2201 were adopted by the 

District to meet NSR requirements under the Clean 

Air Act, as amended in 1990, for areas that have not 

attained the National Ambient Air Quality 

Standards (NAAQS). District Rules 2020 and 2201 

replaced existing NSR rules from the individual 

county air pollution control districts that were 

combined into the San Joaquin Valley Unified Air 

Pollution Control District (‘‘District’’) in 1991. 3For more information on the status of the state 

law exclusion from permitting for agricultural 

sources in the California SIP, please see the related 

proposed rule published in today’s Federal 

Register. 4 District NSR permitting rules do not adopt the 

distinction between minor sources and major 

sources as set forth under the CAA. District Rules 

2020 and 2201 generally apply to both Federal 

minor and major stationary sources. Our limited 

approval and limited disapproval specified that the 

rule deficiency was exempting major agricultural 

sources and major modifications. See 65 FR 58252, 

at 58254 (September 28, 2000). 

5EPA also published an Interim Final 

Determination that SJVUAPCD had corrected the 

July 2001 limited approval deficiencies and EPA 

stayed or deferred the imposition of CAA sanctions 

on the District. See 68 FR 7321. 

6On May 22, 2002, EPA issued a Notice of 

Deficiency for California’s Title V program based on 

the exemption of agricultural sources from Title V 

permitting. See 67 FR 35990 (May 22, 2002). EPA’s 

decision was upheld. See California Farm Bureau 

Fed’n v. EPA, No. 02–73371 (9th Cir. July 15, 2003) 

(memorandum opinion). 

7As explained in Section II.C below, sources with 

emissions below 50 percent of the major source 

threshold are exempt from permitting unless the 

District makes certain findings, while sources at or 

above 50 percent of the major source threshold are 

subject to permitting unless the District makes 

certain findings. See CH&SC section 42301.16(b) 

and (c). In addition, offsets may not be required 

unless they meet the criteria for real, permanent, 

quantifiable, and enforceable emission reductions. 

See CH&SC section 42301.18(c). 

It is worth noting that EPA and California 

interpret CH&SC section 42301.16(a) to require all 

sources that emit or have the potential to emit at 

or above the major source threshold to be subject 

to new source permitting and offset requirements, 

as required by the Clean Air Act, without regard to 

the provisions of sections 42301.16(c) or 

42301.18(c). Thus, an agricultural source with 

actual emissions less than 50 percent of the major 

source threshold but potential emissions above the 

major source threshold is subject to new source 

permitting and offset requirements. 8See Letter from Bill Lockyer, Attorney General, 

California Office of the Attorney General, to 

Marianne Horinko, Acting Administrator, EPA, 

dated November 3, 2003. 

B. Background on District NSR Rules 

2020 and 2201 and Related EPA Actions 

EPA originally approved District NSR 

Rules 2020 (‘‘Exemptions’’) and 2201 

(‘‘New and Modified Stationary Source 

Review Rule’’) into the California SIP on 

July 19, 2001 (66 FR 37587).2 EPA’s July 

19, 2001 action was, however, a limited 

approval and limited disapproval 

reflecting our conclusion that District 

Rules 2020 and 2201 could not be fully 

approved as meeting all applicable 

requirements because, among other 

reasons, District Rule 2020 exempted all 

agricultural sources from District 

permitting requirements. 66 FR at 

37590. At that time, District Rule 2020, 

citing California Health & Safety Code 

(CH&SC) section 42310(e), included a 

permitting exclusion for ‘‘any equipment 

used in agricultural operations in the 

growing of crops or the raising of fowl 

or animals,’’ except for certain orchard 

and citrus grove heaters in the southern 

portion of the District.3 Our limited 

disapproval stated that the District 

could not exempt major stationary 

sources or major modifications at 

existing major sources from NSR 

requirements and be found to meet 

applicable CAA requirements.4

To correct this deficiency, the District 

adopted a revision to Rule 2020 which 

eliminated the agricultural permitting 

exemption in its entirety, and CARB 

submitted the revised Rule 2020 to EPA 

on December 23, 2002 as a revision to 

the California SIP. In response, on 

February 13, 2003, EPA proposed 

several actions regarding the exemption 

of agricultural sources from major 

source NSR permitting requirements. 

First, EPA proposed approval of revised 

District Rule 2020. See 68 FR 7330 

(February 13, 2003).5 In that notice, EPA 

specifically noted that ‘‘California 

Health & Safety Code 42310(e) 

continues to preclude the District, as 

well as all other districts in California, 

from permitting agricultural sources 

under either title I or title V of the 

CAA.’’ See 68 FR 7330, at 7335. 

To address this issue, EPA published 

a proposal finding that California’s 

statutory exemption of agricultural 

sources in CH&SC section 42310(e) from 

major source NSR permitting rules 

violated the requirements of CAA 

section 110(a)(2)(E). See 68 FR 7327 

(February 13, 2003). This action, titled 

‘‘Finding of Substantial Inadequacy of 

Implementation Plan; Call for California 

State Implementation Plan Revision’’ 

(hereinafter ‘‘SIP Call’’), determined that 

California lacked adequate legal 

authority to carry out its NSR permitting 

requirements because CH&SC section 

42310(e) exempted major agricultural 

sources. EPA finalized the SIP Call on 

June 25, 2003, and thereby required 

California to submit the necessary 

assurances of authority by November 23, 

2003 to support an affirmative finding 

by EPA under CAA section 110(a)(2)(E). 

If the State failed to submit the 

necessary assurances, then EPA 

indicated that the sanctions clock under 

CAA section 179 would be triggered.6

See 68 FR 37746 (June 25, 2003). 

Later that summer, the California 

legislature enacted Senate Bill (SB) 700, 

which the Governor of California signed 

on September 22, 2003. SB 700 removed 

the wholesale exemption from 

permitting for agricultural sources 

provided under CH&SC section 42310(e) 

and subjected major agricultural sources 

to permitting requirements. SB 700, 

however, retained exemptions for new 

source permitting for certain minor 

agricultural sources, and limited the 

ability to require minor agricultural 

sources to obtain Federal offsets.7

California notified EPA of the 

legislature’s action by letter dated 

November 3, 2003 thereby avoiding the 

triggering of a sanctions clock. 

California enclosed a copy of SB 700 

with the November 3, 2003 letter.8

On May 17, 2004, EPA took final 

action approving the District’s 

permitting rules, Rules 2020 and 2201, 

as proposed in February 2003. See 69 

FR 27837 (May 17, 2004). These rules, 

as approved by EPA, did not on their 

face exempt any agricultural sources 

from permitting or limit the 

applicability of offset requirements. 

EPA’s final approval stated that the 

District had removed its exemption for 

agricultural sources and that the state 

had also ‘‘removed a similar blanket 

exemption, thereby providing the 

District with authority to require air 

permits for agricultural sources, 

including Federally required NSR 

permits.’’ See 69 FR 27837, at 27838. 

EPA’s final approval cited SB 700 in a 

footnote, but did not note the limited 

scope of authority for permitting and 

offset requirements under SB 700, 

which allowed permitting of only 

certain minor agricultural sources. 

C. Correction of Erroneous Final 

Approval 

In this instance, we believe that our 

May 2004 final full approval of District 

Rules 2020 and 2201 was erroneous. For 

all SIP revisions, States must provide 

evidence that the State has the 

necessary legal authority under State 

law to adopt and implement the plan. 

See CAA section 110(a)(2)(E); 40 CFR 

part 51, appendix V, section 2.1(c). 

Thus, to support the approval CARB 

was required in December 2002 to 

provide evidence that the District had 

the necessary legal authority under State 

law to implement Rules 2020 and 2201, 

which purported to require permits and 

offsets for all agricultural sources. CARB 

could not have done so because CH&SC 

section 42310(e), applicable at that time, 

continued to preclude such authority 

under State law with respect to all 

agricultural sources. 

Nonetheless, we proposed to fully 

approve Rules 2020 and 2201 on 

February 13, 2003, with the expectation 

that the California legislature would act 

to remove CH&SC section 42310(e)’s 

exemption for agricultural sources 


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4748 Federal Register / Vol. 75, No. 19 / Friday, January 29, 2010 / Proposed Rules 

thereby aligning Rule 2020 with District 

authority under State law. 68 FR 7330 

(Feb. 13, 2003). While the legislature 

did act shortly thereafter to remove the 

exemption for major agricultural sources 

and major modifications at existing 

major agricultural sources, the 

legislature also retained the exemption 

from permitting for certain minor 

agricultural sources, leaving the words 

of Rule 2020 broader than the District’s 

authority under State law. The 

legislature also exempted minor 

agricultural sources from obtaining 

offsets pending a determination that 

emissions reductions from such sources 

meet certain criteria, leaving Rule 2201, 

on its face, also at odds with State law. 

As noted above, on May 17, 2004, 

EPA took final action to approve District 

Rules 2020 and 2201, as proposed in 

February 2003. See 69 FR 27837 (May 

17, 2004). We now understand that our 

final approval action on Rules 2020 and 

2201 should have ensured that the 

authority in those rules was consistent 

with the authority granted by SB 700. At 

that time, since the District had made no 

findings to broaden (above 50 percent of 

the major source threshold) or narrow 

the permitting exemption (below 50 

percent of the major source threshold), 

as allowed under SB 700 and now 

codified in CH&SC sections 42301.16(b) 

and (c), the permitting exemption 

provided by State law applied to minor 

agricultural sources with actual 

emissions less than 50 percent of the 

major source threshold. Thus, we 

should have limited our approval of 

Rule 2020 to exclude applicability to 

agricultural sources exempt from new 

source permitting under SB 700 (i.e., 

minor sources with actual emissions 

less than 50 percent of the major source 

threshold). Our approval of Rule 2201 

should have been limited to provisions 

requiring offsets for major agricultural 

sources, because at the time, the District 

had not found emissions reductions 

from agricultural sources to meet the 

criteria for real, permanent, quantifiable, 

and enforceable emissions reductions 

and thus did not invoke the authority 

otherwise provided in SB 700 (and 

codified in CH&SC section 42301.18(c)) 

to impose an offset requirement on new 

or modified minor agricultural sources. 

Given that California submitted a copy 

of SB 700 in November 2003, we had 

information indicating that the District 

did not have the authority to implement 

Rules 2020 and 2201 to the extent that 

the language of the rule appeared to 

allow (i.e., to require permits and offsets 

from all new or modified agricultural 

sources, including those exempt under 

SB 700) prior to the time we took final 

action. We should have limited our 

approval of Rules 2020 and 2201 to 

conform with SB 700, and promulgated 

language in 40 CFR part 52 codifying 

that limitation on our approval. 

We note that recent enforcement 

actions have been brought pursuant to 

the CAA’s citizen suit provisions against 

minor agricultural sources in the 

District that have emissions less than 50 

percent of the major source threshold 

for failure to apply for and receive a 

new or modified source permit. The 

District, however, does not have the 

authority under State law to issue such 

permits. The fact that such cases are 

being brought persuasively supports the 

need to correct our error in approving 

Rules 2020 and 2201 in 2004. 

Therefore, pursuant to CAA section 

110(k)(6), we are proposing to correct 

our error by limiting our approval of 

Rules 2020 and 2201 to apply only to 

the extent the District has authority 

under state law to require permits and 

offsets. Specifically, with respect to 

agricultural sources, we are approving 

Rule 2020 only to the extent it applies 

to agricultural sources subject to 

permitting under SB 700. Also and 

again with respect to agricultural 

sources, we are approving Rule 2201 

only to the extent it requires offsets for 

new major sources and major 

modifications until certain criteria set 

forth in state law are met. To codify this 

proposed error correction, we are 

proposing the following language to be 

added as a new section, 52.245, of 40 

CFR part 52, subpart F (‘‘California’’): 

52.245 New Source Review Rules 

(a) Approval of the New Source Review 

rules for the San Joaquin Valley Unified Air 

Pollution Control District Rules 2020 and 

2201 as approved May 17, 2004, is limited, 

as it relates to agricultural sources, to apply 

the permit requirement only (1) to 

agricultural sources with potential emissions 

at or above a major source applicability 

threshold and (2) to agricultural sources with 

actual emissions at or above 50 percent of a 

major source applicability threshold. The 

offset requirement, as it relates to agricultural 

sources, does not apply to new minor 

agricultural sources and minor modifications 

to agricultural sources. 

In section IV of this document, we are 

proposing a limited approval/limited 

disapproval on subsequent submittals of 

District Rules 2020 and 2201 that carry 

forward the agricultural-source-related 

provisions for which we proposed 

action in February 2008, but that reflect 

subsequent additional changes made by 

the District to the rules. If we finalize 

this action, as proposed, we intend to 

codify the above language to clarify the 

status of affected sources that were 

constructed or were modified during the 

period extending from the effective date 

of our February 2004 final rule (i.e., 

June 16, 2004) through the effective date 

of our action on revised District Rules 

2020 and 2201 as described in section 

IV of this document. 

III. The State’s Submittals of Revised 

District Rules 

A. What rules did the State submit? 

Table 1 lists the rules on which we 

are proposing action in this document 

with the dates that they were revised by 

the District and submitted to EPA by 

CARB. 

TABLE 1—SUBMITTED RULES

Local agency Rule No. Rule title Amended Submitted 

SJVUAPCD .................................... 2020 Exemptions ......................................................................... 12/20/07 03/07/08 

SJVUAPCD .................................... 2201 New and Modified Stationary Source Review Rule ........... 12/18/08 03/17/09 

SJVUAPCD .................................... 2530 Federally Enforceable Potential to Emit ............................. 12/18/08 03/17/09 

On April 17, 2008, we found that the 

submittal of District Rule 2020 met the 

completeness criteria in 40 CFR part 51 

appendix V, which must be met before 

formal EPA review. On April 20, 2009, 

we found the submittal of District Rules 

2201 and 2530 to be complete. 

B. Are there other versions of these 

rules? 

As discussed above, we approved a 

version of Rule 2020 into the SIP on 

May 17, 2004 (69 FR 27837). On 

December 29, 2006, CARB submitted an 

amended version of District Rule 2020. 

On December 20, 2007, the District 

adopted further amendments to Rule 

2020, and CARB submitted the further 

amended rule to us on March 7, 2008. 

The revision to District Rule 2020 that 

CARB submitted on December 29, 2006 

was carried forward with the version 


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9While the District uses the term BACT as the 

level of control required, a review of the definition 

has shown that it is equivalent to the requirements 

for Federal LAER. 

that was submitted on March 7, 2008 

and for which we propose action today. 

We also approved a version of Rule 

2201 into the SIP on May 17, 2004 (69 

FR 27837). Since our May 2004 

approval of Rule 2201 into the SIP, the 

District has amended the rule on four 

occasions. One of those amendments 

added paragraph 4.6.9 to the rule. On 

December 29, 2006, CARB submitted 

only paragraph 4.6.9 from District Rule 

2201 to EPA. On December 18, 2008, the 

District adopted the latest amendments 

to Rule 2201. On March 17, 2009, CARB 

submitted this latest version of District 

Rule 2201 to us. This latest version of 

District Rule 2020 that CARB submitted 

on March 17, 2009 carries forward with 

it all of the changes, including new 

paragraph 4.6.9, that the District has 

made in the rule since our May 2004 

approval. 

Prior to our 2004 approval of Rules 

2020 and 2201, the SJVUAPCD portion 

of the California SIP included a broad 

exemption from permitting for all 

agricultural sources, citing CH&SC 

section 42310(e). See section 4.0 of 

District Rule 2020, as amended on 

September 17, 1998, submitted on 

October 27, 1998, and approved on July 

19, 2001 at 66 FR 37587. 

Lastly, we approved a version of Rule 

2530 into the SIP on April 26, 1996 (61 

FR 18500). Since EPA’s 1996 approval 

of Rule 2530 into the SIP, the District 

has amended Rule 2530 twice, once on 

April 25, 2002 and then again on 

December 18, 2008. On March 17, 2009, 

CARB submitted this latest version of 

District Rule 2530 to us, and it includes 

all amendments to the rule by the 

District to date. 

C. What are the purposes for revisions 

to these rules? 

Section 110(a) of the CAA requires 

states to submit regulations that control 

volatile organic compounds, nitrogen 

oxides, particulate matter, and other air 

pollutants which harm human health 

and the environment. Permitting rules 

were developed as part of the local air 

district’s programs to control these 

pollutants. 

The purpose of District Rule 2020 

(‘‘Exemptions’’) is to specify emission 

units that are not required to obtain an 

Authority to Construct or Permit to 

Operate. Rule 2020 also specifies the 

recordkeeping requirements to verify 

such exemptions and outlines the 

compliance schedule for emission units 

that lose the exemption. 

Relative to the version of Rule 2020 

that is approved into the SIP, the 

changes would revise and clarify certain 

exemptions and conform the rule to 

existing state law by explicitly 

exempting certain agricultural sources 

from permitting requirements. 

Specifically, the changes in District Rule 

2020 would: 

• Revise the existing exemption for 

steam generators, steam superheaters, 

water boilers, water heaters, steam 

cleaners, and closed indirect heat 

transfer systems that have a maximum 

input heat rating of five million Btu per 

hour or less and that are fired 

exclusively on natural gas or liquefied 

petroleum gas (LPG) (see paragraph 

6.1.1 of the submitted rule). The existing 

exemption is limited to the types of 

equipment described above but also 

establishes the following specifications 

for both natural gas and LPG combusted 

by the equipment: ‘‘provided the fuel 

contains no more than five percent by 

weight hydrocarbons * * * and no 

more than 0.75 grains of total sulfur per 

100 standard cubic feet of gas * * *.’’ 

The revised exemption would establish 

separate specifications for natural gas 

and for LPG. The hydrocarbon content 

limit would remain five percent for 

natural gas but would drop to two 

percent for LPG. The sulfur content 

limit would increase from 0.75 grains, to 

1.0 grain for natural gas, and to 15 

grains (per 100 standard cubic feet of 

gas). The revised exemption would 

require use of the latest versions of the 

relevant ASTM test methods. 

• Clarify and tighten the existing 

exemption for certain types of transfer 

equipment, such as loading and 

unloading racks, and equipment used 

exclusively for the transfer of refined 

lubricating oil (see paragraph 6.7 of the 

submitted rule). Specifically, with 

respect to crude oil, the existing 

exemption establishes a limiting 

specification in terms of specific gravity, 

and the revised exemption would add a 

second limiting specification in terms of 

True Vapor Pressure (TVP) and would 

establish certain test methods for 

determining the TVP of crude oil; and 

• Conform District permit 

requirements to State law by explicitly 

exempting agricultural sources to the 

extent such sources are exempt 

pursuant to CH&SC section 42301.16 

(see paragraph 6.20 of the submitted 

rule). Section 42301.16(a) requires local 

air permitting authorities to require 

permits for agricultural sources subject 

to the requirements of title I or title V 

of the Federal Clean Air Act. Section 

42301.16(b) similarly requires permits 

for all agricultural sources unless 

specified findings are made at a public 

hearing or except as provided in section 

42301.16(c). Section 42301.16(c) 

requires the District to make specified 

findings at a public hearing prior to 

requiring permits for agricultural 

sources with emissions that are less 

than one-half of any major source 

threshold. The net effect of this section 

is that all agricultural sources with 

actual emissions or a potential to emit 

at or above a major source applicability 

threshold are required to obtain a 

District permit pursuant to CH&SC 

section 42301.16(a). Agricultural 

sources with actual emissions at or 

above 50 percent of a major source 

applicability threshold are required to 

obtain a District permit, unless the 

District makes the findings specified by 

subsection (b). No permits are required 

for agricultural sources with actual 

emissions of less than 50 percent of any 

major source applicability thresholds, 

unless the District makes the findings 

specified in subsection (c), subject to the 

limitation in CH&SC section 42301(a). 

The purpose of District Rule 2201 

(‘‘New and Modified Stationary Source 

Review Rule’’) is to provide for the 

review of new and modified stationary 

sources of air pollution and to provide 

mechanisms including emission tradeoffs by which Authorities to Construct 

such sources may be granted, without 

interfering with the attainment or 

maintenance of ambient air quality 

standards. District Rule 2201 is also 

intended to provide for no net increase 

in emissions above specified thresholds 

from new and modified stationary 

sources of all nonattainment pollutants 

and their precursors. 

Key features of District Rule 2201 

include: 

• Best Available Control Technology 

(BACT) 9: Mandates emission controls to 

minimize emission increases above de 

minimis values. 

• Emission offsets: Requires 

emissions above specified offset 

threshold levels to be mitigated with 

either concurrent reductions or past 

reductions which have been banked as 

emission reduction credits (ERCs). 

• Public notification: A 30- or 45-day 

notice period prior to issuance of an 

Authority to Construct (ATC) to accept 

comments on projects that result in 

emissions above specified levels. 

• Required elements for Authority to 

Construct, Permit to Operate and 

administrative requirements for 

processing NSR applications. 

As submitted on March 17, 2009, 

District Rule 2201 incorporates three 

major changes relative to the version of 

Rule 2201 that is approved into the SIP. 

First, amended District Rule 2201 would 

replace the term, ‘‘Major Modification,’’ 


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with two terms, ‘‘Federal major 

modification’’ and ‘‘SB 288 major 

modification.’’ (See paragraphs 3.17 and 

3.34 of the amended rule.) The former 

term incorporates EPA’s NSR reform 

principles, and the latter term retains 

the pre-NSR reform approach to 

determining whether a modification is a 

major modification. Second, amended 

District Rule 2201 would incorporate 

the lower ‘‘major source’’ and ‘‘Federal 

major modification’’ emissions 

thresholds, and higher offset ratios, for 

the ozone precursors, VOC and NOX, 

consistent with an ‘‘extreme’’ ozone 

classification. (See paragraphs 3.17, 

3.23, and 3.34 of the amended rule). 

Lastly, changes to District Rule 2201 

would conform the rule to existing state 

law by exempting new or modified 

agricultural sources from offset 

requirements, unless the offsets are 

required by Federal CAA requirements. 

(See paragraph 4.6.9 of the amended 

rule.) 

Other changes in amended Rule 2201 

would: 

• Tighten one of the conditions that 

qualify a replacement of ‘‘any article, 

machine, equipment, or other 

contrivance’’ as a ‘‘Routine 

Replacement;’’ the existing rule requires 

that such a replacement, among other 

conditions, not result in an increase in 

permitting emissions from the 

‘‘stationary source,’’ whereas, the 

modified definition of the term ‘‘routine 

replacement’’ requires no such increase 

from the ‘‘replacement unit(s) (see 

paragraph 3.33.1 of the amended rule); 

• Expressly extend the existing 

emission offset exemption for portable 

equipment to equipment registered in 

accordance with the provisions of 

District Rule 2250 (Permit-Exempt 

Equipment Registration) (see paragraph 

4.6.3 of the amended rule). The existing 

exemption covers portable equipment 

registered under District Rule 2280 

(Portable Equipment Registration) or 

under the Statewide Portable Equipment 

Registration Program. Existing District 

Rule 2020 provides a permitting 

exemption for portable emissions units 

covered by a valid registration under the 

above registration programs ‘‘or other 

equipment registration program 

approved by the APCO.’’ District Rule 

2250 is such a program, and thus, 

portable equipment registered under 

District Rule 2250 are exempt, not just 

from the emission offset requirement, 

but also from the requirement for a 

permit. However, the District expressly 

added a reference to equipment 

registered under District Rule 2250 in 

the emission offset exemption portion of 

Rule 2201 to provide consistency with 

similar exemptions for portable 

equipment and to avoid confusion; and 

• Provide for a lower offset ratio 

(from 1.5 to 1.2) in the event EPA 

approves a demonstration that all 

existing major sources of VOC and NOX

in the San Joaquin Valley are equipped 

with BACT as defined in CAA section 

169(3) (see paragraph 4.8.2 of the 

amended rule). This change amends the 

SIP to add the lower offset ratio 

provision contained in CAA section 

182(e)(1). The lower offset ratio referred 

to in paragraph 4.8.2 has no current 

effect, because the required 

demonstration has not been submitted 

to EPA. Moreover, EPA would be 

reviewing any such demonstration, most 

likely as a SIP revision, and that review 

would include a review for compliance 

with the relevant statutory provision in 

CAA section 182(e)(1). 

Unlike District Rules 2020 and 2201, 

District Rule 2530 (‘‘Federally 

Enforceable Potential to Emit’’) is not an 

NSR rule, but is a rule that relies on 

thresholds based on certain percentages 

of the major source thresholds 

established for NSR purposes as a basis 

to exempt sources from the 

requirements of Rule 2520 (‘‘Federally 

Mandated Operating Permits’’). Relative 

to the corresponding rule in the existing 

SIP, the amended rule would lower the 

thresholds below which sources of VOC 

or NOX are exempt from the 

requirements of Rule 2520 (see 

paragraph 6.1 of the amended rule), 

would lower the thresholds below 

which sources are exempt from certain 

recordkeeping and reporting 

requirements under Rule 2530 (see 

paragraph 5.4.1.2 of the amended rule); 

and would lower certain alternative 

operational limits (see, e.g., paragraph 

6.2.4 of the amended rule). 

IV. EPA’s Evaluation and Action on the 

Rule Revisions 

A. How is EPA evaluating the rules? 

The rules that are the subject of this 

proposed action amend rules that EPA 

has previously approved as meeting the 

statutory and regulatory requirements 

for SIPs regarding minor NSR, major 

nonattainment NSR, and enforceability 

of permit conditions. Therefore, we 

have focused our review on the changes 

in the rules relative to the versions of 

the rules in the existing SIP to ensure 

the amended rules continue to meet the 

applicable requirements, taking into 

account that, in some instances, such as 

the ‘‘major source’’ threshold 

requirement, the applicable 

requirements have changed since we 

last acted on these rules. 

The relevant statutory provisions for 

our review of the submitted rules 

include CAA section 110(a), section 

110(l), and section 182(e) and (f). 

Section 110(a) requires that SIP rules be 

enforceable, while section 110(l) 

precludes EPA approval of SIP revisions 

that would interfere with any applicable 

requirement concerning attainment and 

reasonable further progress or any other 

applicable requirement of the Act. 

Section 182(e) (together with section 

182(f) for NOX), requires NSR SIPs in 

‘‘extreme’’ nonattainment areas to define 

‘‘major sources’’ in terms of 10 tons per 

year of VOC or NOX, to lower the 

threshold for ‘‘major modifications’’ to 

zero, and to increase the offset ratio to 

1.5 to 1. In addition, we have reviewed 

the submitted rules for compliance with 

EPA implementing regulations for NSR, 

including 40 CFR 51.160 through 40 

CFR 51.165. 

B. Do the rules meet the evaluation 

criteria? 

1. Regulatory Context 

Other than rule clarifications and 

other minor revisions, the changes to 

the District’s rules that are the subject of 

this action fall into four broad 

categories: Changes affecting minor 

source NSR permitting requirements; 

changes relating to the area’s extreme 

classification for the 1-hour ozone 

standard; changes relating to NSR 

Reform; and changes affecting the 

mechanism used by sources to avoid 

title V requirements. 

First, however, to provide the proper 

context for evaluating the submitted 

changes in the District’s rules, it is 

important to consider the designations 

and plan status for the valley with 

respect to the relevant national ambient 

air quality standards. Area designations 

for California are set forth in 40 CFR 

81.305 and shown in table 2, below. As 

shown in table 2, the San Joaquin Valley 

Air Basin is designated ‘‘nonattainment’’ 

for the 1997 8-hour ozone standard. 

With respect to particulate matter, the 

valley is designated ‘‘attainment’’ for 

PM10 and ‘‘nonattainment’’ for PM2.5. 


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TABLE 2—SAN JOAQUIN VALLEY AREA DESIGNATIONS

Pollutant Designation Classification 

(Revoked) Ozone—1-hour standard ............ Nonattainment ............................................................. Extreme (at the time of designation for the 

1997 8-hour ozone standard). 

Ozone—1997 8-hour standard ..................... Nonattainment ............................................................. Serious.a

Respirable Particulate Matter (PM10) ........... Attainment .................................................................... Not Applicable. 

Fine Particulate Matter (PM2.5) .................... Nonattainment ............................................................. Not Applicable. 

Carbon Monoxide ......................................... Attainment (4 urban areas); Unclassifiable/Attainment 

(rest of valley).

Not Applicable. 

Nitrogen Dioxide ........................................... Unclassifiable/Attainment ............................................ Not Applicable. 

Sulfur Dioxide ............................................... Unclassifiable/Attainment ............................................ Not Applicable. 

aThe State of California has requested reclassification of the San Joaquin Valley to ‘‘extreme’’ for the 1997 8-hour ozone standard. See 74 FR 

43654 (August 27, 2009). 

As to ozone, the valley is classified as 

a ‘‘serious’’ ozone nonattainment area for 

the 1997 8-hour ozone standard, but the 

State of California has requested 

reclassification of the area to ‘‘extreme.’’ 

See 74 FR 43654 (August 27, 2009). The 

designation of an area as 

‘‘nonattainment’’ triggers certain SIP 

planning requirements, and on 

November 16, 2007, the State of 

California responded to those 

requirements by submitting the San 

Joaquin Valley 2008 Ozone Plan to EPA 

as a revision to the California SIP. EPA 

has not yet acted on the plan. 

Significantly, because, as a general 

matter, the SIP requirements that 

applied by virtue of an area’s 

classification for the now-revoked 1- 

hour ozone standard continue to apply 

to an 8-hour ozone nonattainment area, 

we note that the San Joaquin Valley was 

designated as an ‘‘extreme’’ 

nonattainment area for the 1-hour ozone 

standard at the time of designation for 

the 8-hour ozone standard. Recently, 

EPA approved the San Joaquin Valley 

2004 Ozone Plan, which had been 

developed to address the SIP 

requirements for ‘‘extreme’’ areas for the 

1-hour ozone standard. 

As to PM10, in 2008, EPA approved a 

redesignation request for the area from 

‘‘nonattainment’’ to ‘‘attainment’’ for the 

PM10 standard and also approved the 

San Joaquin Valley 2007 PM10

Maintenance Plan as a revision to the 

California SIP. See 73 FR 66759 

(November 12, 2008). 

As to PM2.5, in 2005, EPA designated 

the valley ‘‘nonattainment’’ for the 1997 

PM2.5 standards. In response, on June 

30, 2008, the State of California 

submitted the San Joaquin Valley 2008 

PM2.5 Plan as a revision to the California 

SIP. EPA has not yet taken action on the 

plan. More recently, EPA designated the 

valley as nonattainment for the more 

stringent 24-hour PM2.5 standard 

promulgated by EPA in 2006. See 74 FR 

58688 (November 13, 2009)(Air Quality 

Designations for the 2006 PM2.5

NAAQS). 

With respect to carbon monoxide, the 

valley, outside of four urban areas, is 

designated as ‘‘unclassifiable/ 

attainment.’’ Bakersfield, Fresno, 

Modesto, and Stockton, the four urban 

areas where violations of the carbon 

monoxide standard had been monitored 

during the 1970s and 1980s, were 

redesignated from ‘‘nonattainment’’ to 

‘‘attainment’’ in 1998. Lastly, the valley 

is designated as unclassifiable or 

attainment for the nitrogen dioxide and 

sulfur dioxide standards. 

2. Minor Source NSR Permitting 

Requirements 

a. General Considerations 

The amended rules would affect 

minor source NSR (‘‘minor NSR’’) by 

revising an existing permitting 

exemption for certain natural-gas- or 

LPG-fired combustion and heat transfer 

systems (see paragraph 6.1 in submitted 

District Rule 2020), by exempting minor 

agricultural sources with emissions less 

than 50 percent of the major source 

threshold (see paragraph 6.20 in 

submitted District Rule 2020) from 

permitting, and by exempting all new or 

modified minor agricultural sources 

from the offset requirement (see 

paragraph 4.6.9 of submitted District 

Rule 2201). 

The requirements in 40 CFR 51.160 

(‘‘Legally enforceable procedures’’), 

subsections (a) and (e) provide the basis 

for evaluating exemptions from NSR 

permitting. The basic purpose of NSR 

permitting is set forth in 40 CFR 

51.160(a). Section 51.160(a) requires 

NSR SIPs to set forth legally enforceable 

procedures that enable the State or local 

agency to determine whether the 

construction or modification of a 

stationary source would result in a 

violation of applicable portions of the 

control strategy; or would result in 

interference with attainment or 

maintenance of a national standard in 

the State in which the proposed source 

or modification is located or in a 

neighboring state. Section 51.160(e) 

provides that the procedures must 

identify types and sizes of stationary 

sources, which will be subject to review. 

We view this provision as allowing a 

State to exempt certain types and sizes 

of stationary sources so long as the 

program continues to serve the purposes 

outlined in 40 CFR 51.160(a). Thus, the 

revised exemption for certain natural 

gas or LPG-fired boilers, and the 

exemption from permitting for nonmajor agricultural sources whose actual 

emissions (excluding fugitive dust) are 

less than 50 percent of the major source 

thresholds are approvable so long as the 

minor source permitting program (i.e., 

including the exemption) continues to 

provide the necessary information to 

allow the District to determine whether 

new or modified stationary sources 

would result in a violation of applicable 

portions of the control strategy or would 

result in interference with attainment or 

maintenance of a national standard. In 

other words, exemptions are approvable 

if it can be shown that it is not necessary 

to review exempt sources in order to 

meet the purposes of 40 CFR 51.160(a). 

Under 40 CFR 51.160, the District has 

discretion in conducting its minor 

source permitting program to exempt 

certain small sources and, under Federal 

law, minor sources are not required to 

obtain offsets. Congress directed the 

States to exercise the primary 

responsibility under the CAA to tailor 

air quality control measures, including 

minor source permitting programs, to 

the State’s needs. See Train v. NRDC, 

421 U.S. 60, 79 (1975) (States make the 

primary decisions over how to achieve 

CAA requirements); Union Electric Co. 

v. EPA, 427 U.S. 246 (1976); Greenbaum 

v. EPA, 370 F.3d 527 (6th Cir. 2006). 

b. Analysis 

With respect to certain smaller 

combustion and heat transfer systems 

(steam generators, water boilers, etc.), 

amended Rule 2020 revises the existing 

permitting exemption in paragraph 6.1.1 


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10 If, in the future, use of natural gas or LPG no 

longer represents BACT for sulfur emissions, then 

this exemption may need to be re-evaluated. 

of the rule by providing separate fuel 

specifications for natural gas and LPG 

for those types of equipment eligible for 

the exemption. The hydrocarbon 

specification would remain unchanged 

for natural gas but would be tightened 

for LPG from five percent to two percent 

(by weight). With respect to sulfur 

content, the fuel specification would be 

relaxed from 0.75 grains (of total sulfur 

per 100 standard cubic feet of gas) to 1.0 

grain (for natural gas) and 15 grains (for 

LPG). Theoretically, the effect of this 

change would be that certain 

combustion and heat transfer systems, 

that otherwise would be covered by the 

permit requirement, would avoid NSR, 

and would not be subject to the 

applicable controls, such as BACT and 

offsets, thereby resulting in emissions 

increases that may or may not be 

accounted for in regional plans intended 

to attain or maintain the national 

standards. 

In response to a query from EPA 

concerning potential emissions impacts 

in the relaxation of the sulfur content 

specifications, the District explained 

how, notwithstanding the permitting 

exemption, certain prohibitory rules, 

such as Rule 4308 (Boilers, Steam 

Generators, and Process Heaters 0.075 to 

2 MMBtu/hr) and Rule 4307 (Boilers, 

Steam Generators, and Process Heaters 2 

to 5 MMBtu/hr) would still apply. See 

the District’s November 13, 2009 

memorandum, which we have placed in 

the docket for this rulemaking. 

Moreover, the District explained how, 

even if the BACT requirement were 

triggered by a source that otherwise 

would be exempt due to the relaxed 

sulfur content specification, BACT for 

emissions of sulfur oxides has 

historically been the use of LPG or 

natural gas, which is already a 

precondition for application of the 

exemption in the first place.10 We find 

the District’s explanation sufficient to 

find that the relaxed sulfur content 

specification in amended Rule 2020, 

paragraph 6.1, would have no 

significant impact on emissions in the 

valley. 

In evaluating the limited permitting 

exemption for agricultural sources for 

consistency with 40 CFR 51.160(a), EPA 

is taking into account the specific 

pollutants emitted from agricultural 

operations, relevant non-permitting 

requirements, and regional air quality 

plans. First, California law defines 

‘‘agricultural source’’ as a source of air 

pollution or group of sources used in 

the production of crops or the raising of 

fowl or animals located on contiguous 

property under common ownership or 

control that is a confined animal facility 

(e.g., barn, corral, coop); is an internal 

combustion engine used in the 

production of crops or the raising of 

fowl or animals (e.g., irrigation pumps, 

but excluding nonroad vehicles such as 

tractors); or is a title V source or is a 

source that is otherwise subject to 

regulation by a district or the Federal 

Clean Air Act. See CH&SC section 

39011.5. As such, agricultural sources 

include both combustion sources (such 

as, internal combustion engines and 

boilers) and non-combustion sources 

[e.g., confined animal facilities and onand off-field vehicular activity (e.g., 

tilling and harvesting)]. Among the noncombustion agricultural sources, some 

by their nature generate fugitive 

emissions such as tilling, harvesting, 

and vehicle travel over unpaved farm 

roads. 

Agricultural sources, as described 

above, emit volatile organic compounds 

(VOC), oxides of nitrogen (NOX), 

particulate matter (PM10 and PM2.5), and 

carbon monoxide. As precursors for 

ozone, PM10 and PM2.5, emissions of 

NOX and VOC from agricultural sources 

are not a local concern but are logically 

evaluated from the standpoint of 

regional air quality planning efforts. 

Direct PM10 and PM2.5 are both of local 

and regional concern and thus our 

evaluation must consider both the 

potential for local exceedances of the 

standard due to the exemption, and for 

inconsistency with regional control 

strategies for these pollutants. Carbon 

monoxide is typically a pollutant of 

localized concern, and emissions of 

carbon monoxide from exempt 

agricultural sources would not be 

significant given the rural location of 

agricultural sites, which are well away 

from the urban centers and high traffic 

densities historically associated with 

high ambient concentrations of carbon 

monoxide in the valley, and the long 

record of attainment of the carbon 

monoxide standard even within the 

urban centers of the valley. A pollutantspecific evaluation of the exemption for 

particulate matter and ozone is provided 

in the following paragraphs. 

Particulate Matter. With respect to 

PM10 and PM2.5, paragraph 6.20 of 

amended Rule 2020 would exempt 

agricultural operations with emissions 

up to 50 tons per year (assuming that 

100 tons per year is the current 

applicable major source threshold based 

on the valley’s current area designations 

for PM10 and PM2.5). This threshold 

value, however, excludes fugitive dust, 

and thus, the permitting exemption 

would extend to agricultural sources 

with overall actual emissions of PM10

and PM2.5 greater than 50 tons per year. 

Without application of some types of 

control measures, we would have no 

basis to categorically conclude that such 

sources would under no reasonably 

foreseeable circumstances cause or 

contribute to an exceedance of the PM10

or PM2.5 standard. 

However, because the District has 

adopted other rules that serve to control 

the fugitive dust emissions from 

agricultural sources, including those 

that would not require a permit due to 

the exemption in amended District Rule 

2020, paragraph 6.20, we believe the 

exemption can be approved consistent 

with 40 CFR 51.160(a) and (e). 

Specifically, District Rule 4550 

(‘‘Conservation Management Practices’’) 

and the District’s Regulation VIII 

(‘‘Fugitive PM10 Prohibitions’’, 

particularly, Rules 8011 and 8081) act as 

non-permitting means to reduce fugitive 

dust emissions at agricultural sources 

that fall under the exemption and 

reduce the potential for localized 

exceedances of the PM10 and PM2.5

standards. As explained further below, 

as a general matter, District Rule 4550 

covers on-field agricultural operations 

and is implemented through an 

application and District approval 

process, whereas District Rules 8011 

and 8081 cover off-field agricultural 

operations and are implemented as 

prohibitory rules. 

District Rule 4550 (‘‘Conservation 

Management Practices’’) applies to 

agricultural operation sites located 

within the San Joaquin Valley Air Basin 

and is intended to limit fugitive dust 

emissions from such sites. EPA 

approved Rule 4550 and associated List 

of Conservation Management Practices 

(CMP List) into the California SIP in 

2006. See 71 FR 7683 (February 14, 

2006). Under the rule, an owner/ 

operator must implement the applicable 

CMPs selected pursuant to section 6.2 

(one CMP from the CMP list for each of 

the applicable CMP categories for each 

agricultural parcel of an agricultural 

operation site). An owner/operator must 

prepare and submit a CMP Application 

for each agricultural operation site to 

the APCO for approval. A CMP 

Application approved by the APCO 

constitutes a CMP Plan, and owner/ 

operators must implement the CMPs as 

contained in the CMP Plan. 

Exemptions in District Rule 4550 

include agricultural operation sites 

where the total acreage of all 

agricultural parcels is less than 100 

acres and exempts Animal Feeding 

Operations (AFOs) involving less than a 

certain number of animals: Less than 

500 mature dairy cows, less than 190 


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11Also see the District’s Clean Air Act section 

110(l) analysis, entitled ‘‘San Joaquin Valley Unified 

Air Pollution Control District Rules 2020 and 2201, 

as amended September 21, 2006, District’s Clean 

Air Act 110(l) Analysis,’’ dated November 20, 2007. 

12The District’s view on the whether CH&SC 

section 42301.16 (and cited in District Rule 2020, 

section 6.20) covers fugitive VOC emissions is 

found in the District’s Final Staff Report (page 

B–13, response to comment #19) on proposed 

amendments to Rule 2201 and Rule 2530 (dated 

December 18, 2008): ‘‘The District appreciates the 

opportunity to reiterate that, for the purposes of 

implementing CH&SC sections 40724.6(c) and 

42301.16(c), all emissions, except for fugitive dust, 

must be included in calculations to determine 

district permitting requirements based on one-half 

of the major source thresholds. The statutory 

language of these sections is consistent, which read 

separately or in the interrelated nature in which 

they were intended to be read, and [sic] District’s 

implementation adheres to this statutory language.’’ 

Thus, fugitive VOC emissions are included in the 

determination of whether actual emissions from a 

minor agricultural operation are greater than 50% 

of the applicable major source threshold which, for 

VOC, is 10 tons per year, or, in other words, greater 

than 5 tons per year. 

13Like fugitive dust and District Rules 4550, 

8011, and 8081, emissions of NOX from certain 

types of equipment found at agricultural sources, 

such as boilers and internal combustion engines, 

are covered by District prohibitory rules regardless 

of whether a given agricultural source is subject to 

permitting. Two such rules include District Rules 

4308 and 4702. SIP-approved District Rule 4308 

(‘‘Boilers, Steam Generators, and Process Heaters’’) 

limit NOX emissions from boilers between 75,000 

Btu/hour and 2 million Btu/hour. See 72 FR 29886 

(May 30, 2007). SIP-approved District Rule 4702 

(‘‘Internal Combustion Engines—Phase 2’’) limits 

NOX, VOC, and carbon monoxide from internal 

combustion engines with rated brake horsepower 

greater than 50 horsepower. See 73 FR 1819 

(January 10, 2008). Such prohibitory rules further 

reduce the chance that agricultural sources that 

would be exempt from permitting under District 

Rule 2020, paragraph 4.6.9, might interfere with 

attainment or maintenance of the national 

standards. 

cattle, less than 55,000 turkeys, less 

than 125,000 chickens (other than 

laying hens), or less than 82,000 laying 

hens. The District’s staff report on Rule 

4550 (dated August 19, 2004) concludes 

that Rule 4550 (with its 100-acre 

exemption level) will apply to 

approximately 91 percent of all irrigated 

farmland in the SJV. The District also 

estimated emissions from 100-acre 

farms to determine the emission impact 

of an exemption. District staff analyzed 

different commodities and determined 

that PM10 emissions would be quite low 

for smaller farms, less than 1 ton per 

year. See 71 FR 7683, at 7685 (February 

14, 2006). The District also calculated 

the emissions impact of the size-based 

exemptions for animal feeding 

operations. Rule 4550 is expected to 

apply to 73% of dairy cows, 94% of 

feedlot cattle, and nearly all poultry 

operations in the valley. The District 

also determined that any sites qualifying 

for the size-based cut-offs would have 

emissions no greater than 1 ton per year. 

See 71 FR 7683, at 7685 (February 14, 

2006). Such small farms would not be 

expected to cause or contribute to 

localized exceedances of the PM10 or 

PM2.5 standard. 

The District’s Regulation VIII 

(‘‘Fugitive PM10 Prohibitions’’) is 

intended to reduce ambient 

concentrations of PM10 by requiring 

actions to prevent, reduce or mitigate 

anthropogenic fugitive dust emissions 

from specified outdoor fugitive dust 

sources. Rule 8011 establishes generally 

applicable definitions, exemptions, 

requirements, administrative 

requirements, recordkeeping 

requirements, and test methods under 

Regulation VIII. Rule 8081 

(‘‘Agricultural Sources’’) establishes 

specific requirements for off-field 

agricultural sources. EPA approved 

Regulation VIII, including Rules 8011 

and 8081, into the California SIP in 

2003 (68 FR 8830, February 26, 2003) 

and approved Regulation VIII 

amendments into the California SIP in 

2006 (71 FR 8461, February 17, 2006). 

District Rule 8081 applies to off-field 

agricultural sources, which includes any 

agricultural source that meets the 

definition of: Outdoor handling, storage 

and transport of bulk material; paved 

road; unpaved road; or unpaved 

vehicle/equipment traffic area. Under 

Rule 8081, an owner/operator must 

sufficiently implement at least one of 

the control measures indicated in the 

rule to limit visible dust emissions 

(VDE) to 20% opacity or to stabilize the 

affected surface consistent with the 

requirements in Rule 8011. Together, 

implementation of the fugitive dust 

control measures required under District 

Rule 4550 and Rules 8011 and 8081 

provide EPA with a reasonable basis to 

conclude that agricultural operations 

that escape permitting under paragraph 

6.20 of amended District Rule 2020 

would not cause or contribute to an 

exceedance of the PM10 or PM2.5

standard. 

With respect to the regional planning 

context, we have reviewed the various 

approved and submitted San Joaquin 

Valley attainment or maintenance plans 

cited above, and note that none of these 

plans rely upon NSR for agricultural 

sources less than 50 percent of the major 

source threshold. Further, for 

attainment planning purposes, growth 

in emissions from agricultural sources 

has been established by CARB’s area 

source inventory growth methodologies, 

and no mitigation of that growth from 

an offsets requirement has been 

considered when determining the 

impact of the growth on the District’s 

ability to achieve attainment with the 

standards.11 In contrast, emissions 

reductions from the prohibitory rules 

affecting agricultural sources, discussed 

above, are taken into account in the plan 

inventory projections. Because the plans 

do not rely on emission reductions from 

permitting of agricultural sources less 

than 50% of the major source threshold 

and not rely on offsets for new or 

modified minor agricultural sources, 

approval of the amended Rules 2020 

and 2201 would be consistent with 

regional planning efforts to attain and 

maintain the NAAQS. 

Ozone. With respect to ozone 

precursors (VOC AND NOX), paragraph 

6.20 of amended District Rule 2020 

would exempt agricultural operations 

with ‘‘actual’’ emissions (i.e., including 

fugitive emissions) 12 of less than 5 tons 

per year based on an applicable major 

source threshold of 10 tons per year. As 

such, the scope of the exemption 

therefore is limited to small-scale 

agricultural operations and is acceptable 

so long as the ozone plans for the valley 

do not count on permitting of such 

sources. As noted above, the regional 

plans do not rely on emission 

reductions from permitting of 

agricultural sources less than 50% of the 

major source threshold nor do the plans 

rely on offsets for new or modified 

minor agricultural sources.13

3. ‘‘Extreme’’ Ozone Area NSR 

Requirements 

The most recent version of the 

District’s NSR rules that EPA has 

approved into the SIP was adopted by 

the District on December 19, 2002. Since 

that time, with respect to major sources 

and major modifications, there have 

been two significant regulatory changes 

affecting the NSR rules in San Joaquin 

Valley: (1) EPA’s approval of the State 

of California’s request to reclassify the 

San Joaquin Valley to ‘‘extreme’’ for the 

1-hour ozone standard, and (2) EPA’s 

promulgation of NSR Reform Rules. 

EPA approved the State of California’s 

request to reclassify the San Joaquin 

Valley to ‘‘extreme’’ for the 1-hour ozone 

standard in 2004. See 69 FR 20550 

(April 16, 2004). In doing so, EPA 

established a deadline of May 16, 2005 

for submittal of revised District NSR 

rules that reflect the requirements for 

‘‘extreme’’ ozone nonattainment areas. 

For such areas, the relevant NSR 

requirements include a major source 

threshold of 10 tons per year of VOC or 

NOX [see CAA section 182(e) and 182(f) 

and 51.165(a)(1)(iv)], the offset ratio is 

1.5 to 1 [see CAA section 182(e)(1) and 

40 CFR 51.165(a)(9)], and any change at 

a major stationary source which results 

in any increase in emissions from any 

discrete operation, unit, or other 

pollutant emitting activity at the source 


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4754 Federal Register / Vol. 75, No. 19 / Friday, January 29, 2010 / Proposed Rules 

is considered a major modification [see 

CAA section 182(e)(2) and 40 CFR 

51.165(a)(1)(x)(E)]. These NSR SIP 

requirements will also apply once we 

approve the State of California’s request 

to reclassify San Joaquin Valley to 

‘‘extreme’’ for the 8-hour ozone standard. 

As submitted on March 17, 2009, the 

VOC and NOX provisions in District 

Rule 2201 have been amended to 

include the 10 ton per year threshold 

(see section 3.23 of amended Rule 

2201), the 1.5 to 1 offset ratio (see 

section 4.8.1 of amended Rule 2201), 

and the ‘‘any increase’’ threshold for 

major modifications (see 3.17.1.4 of 

amended Rule 2201). As such, District 

Rule 2201 has adequately been amended 

to reflect ‘‘extreme’’ ozone area 

requirements under the CAA and 40 

CFR 51.165. 

4. EPA’s NSR Reform Rules 

On December 31, 2002 (67 FR 80186), 

EPA published final rule changes to 40 

CFR parts 51 and 52, regarding the 

CAA’s PSD and Nonattainment NSR 

programs relating to major sources and 

major modifications. On November 7, 

2003 (68 FR 63021), EPA published a 

notice of final action on the 

reconsideration of the December 31, 

2002 final rule changes. The December 

31, 2002, and the November 7, 2003, 

final actions are collectively referred to 

as the ‘‘2002 NSR Reform Rules.’’ The 

purpose of this action is to propose to 

approve the SIP submittal from the State 

of California that includes rule changes 

made as a result of EPA’s 2002 NSR 

Reform Rules. 

The 2002 NSR Reform Rules made 

changes to five areas of the NSR 

programs. In summary, the 2002 Rules: 

(1) Provide a new method for 

determining baseline actual emissions; 

(2) adopt an actual-to-projected-actual 

methodology for determining whether a 

major modification has occurred; 

(3) allow major stationary sources to 

comply with Plantwide Applicability 

Limitations (PALs) to avoid having a 

significant emissions increase that 

triggers the requirements of the major 

NSR program; (4) provided a new 

applicability provision for emissions 

units that are designated clean units; 

and (5) excluded pollution control 

projects (PCPs) from the definition of 

‘‘physical change or change in the 

method of operation.’’ On November 7, 

2003 (68 FR 63021), EPA published a 

notice of final action on its 

reconsideration of the 2002 NSR Reform 

Rules, which added a definition for 

‘‘replacement unit’’ and clarified an 

issue regarding PALs. For additional 

information on the 2002 NSR Reform 

Rules, see, 67 FR 80186 (December 31, 

2002), and http://www.epa.gov/nsr. 

After the 2002 NSR Reform Rules 

were finalized and effective (March 3, 

2003), industry, state and environmental 

petitioners challenged numerous 

aspects of the 2002 NSR Reform Rules, 

along with portions of EPA’s 1980 NSR 

Rules (45 FR 52676, August 7, 1980). On 

June 24, 2005, the United States Court 

of Appeals for the District of Columbia 

(DC Circuit Court) issued a decision on 

the challenges to the 2002 NSR Reform 

Rules. New York v. United States, 413 

F.3d 3 (DC Cir. 2005). In summary, the 

DC Circuit Court vacated portions of the 

rules pertaining to clean units and PCPs, 

remanded a portion of the rules 

regarding recordkeeping and the term 

‘‘reasonable possibility’’ found in 40 CFR 

52.21(r)(6) and 40 CFR 51.166(r)(6), and 

either upheld or did not comment on 

the other provisions included as part of 

the 2002 NSR Reform Rules. On June 13, 

2007 (72 FR 32526), EPA took final 

action to revise the 2002 NSR Reform 

Rules to remove from Federal law all 

provisions pertaining to clean units and 

the PCP exemption that were vacated by 

the DC Circuit Court. 

With regard to the remanded portions 

of the 2002 NSR Reform Rules related to 

recordkeeping, on December 21, 2007, 

EPA took final action to establish that a 

‘‘reasonable possibility’’ applies where 

source emissions equal or exceed 50 

percent of the CAA NSR significant 

levels for any pollutant (72 FR 72607). 

The ‘‘reasonable possibility’’ provision 

identifies for sources and reviewing 

authorities the circumstances under 

which a major stationary source 

undergoing a modification that does not 

trigger major NSR must keep records. 

The 2002 NSR Reform Rules require 

that states adopt and submit revisions to 

their SIP permitting programs 

implementing the minimum program 

elements of the 2002 NSR Reform Rules 

no later than January 2, 2006. State 

agencies may meet the requirements of 

40 CFR part 51 and the 2002 NSR 

Reform Rules with different but 

equivalent regulations. 

As submitted on March 17, 2009, 

District Rule 2201 has been amended to 

provide for the minimum program 

elements of the 2002 NSR Reform Rules 

that remain in the wake of subsequent 

litigation and EPA rulemaking. The 

amended rule provides for the 

minimum program elements by 

replacing a single definition for ‘‘Major 

Modification’’ with two definitions, one 

for ‘‘Federal Major Modification’’ and 

the other for ‘‘SB 288 Major 

Modification.’’ The former term captures 

the NSR Reform program elements (and 

the ‘‘any increase’’ emissions threshold 

required in ‘‘extreme’’ ozone areas), 

while the latter retains the pre-Reform 

approach to determining major 

modification status. Section 3.17.1 

incorporates the new method for 

determining baseline actual emissions 

and the actual-to-projected-actual 

methodology for determining whether a 

major modification has occurred. 

Section 3.17.2 incorporates provisions 

allowing major stationary sources to 

comply with PALs. Amended District 

Rule 2201 avoids any issue concerning 

potential SIP relaxations due to these 

changes, because, consistent with State 

law (SB 288), the District retained the 

pre-reform requirements. The net effect 

of these changes are that the District 

will now perform two separate major 

modification determinations, one to 

determine if the project will result in a 

SB 288 Major Modification and the 

other to determine if it will result in a 

Federal Major Modification. Under the 

revised rule, a modification of an 

existing stationary source would be 

required at a minimum to meet the NSR 

SIP requirements that had applied prior 

to adoption by the District of the 2002 

NSR Reforms into Rule 2201, and may 

have to meet additional NSR 

requirements if the modification is 

determined to be a Federal Major 

Modification. 

5. Other Changes to District Rules 2020 

and 2201 

As described in section III.C of this 

document, the District has made a 

number of changes to their NSR Rules 

(i.e., Rules 2020 and 2201) not directly 

related to fuel specifications, 

agricultural sources, ‘‘extreme’’ area 

requirements, or NSR Reform. These 

changes include clarification and 

tightening of an existing exemption for 

certain types of transfer equipment and 

equipment used exclusively for the 

transfer of refined lubricating oil (see 

paragraph 6.7 of amended Rule 2020); 

tightening of one of the conditions that 

qualify a replacement of equipment as 

‘‘routine replacement’’ (see paragraph 

3.33.1 of amended Rule 2201); 

clarification of the scope of an existing 

emission offset exemption for portable 

equipment (see paragraph 4.6.3 of 

amended Rule 2201); and provision for 

a lower offset ratio if and when EPA 

makes the necessary findings under 

CAA section 182(e)(1) (see paragraph 

4.8.2 of amended Rule 2210). We find 

these changes to either be neutral or 

strengthening relative to the existing SIP 

and consistent with all applicable 

requirements. 


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14The approach in District Rule 2530 of 

establishing emission limits and alternative 

operational limits that are intended to represent 

percentages of the applicable major source 

threshold (50% for emission limits and 80% for 

alternative operational limits), as a mechanism to 

allow sources to avoid title V permitting 

requirements, is consistent with EPA guidance on 

this subject as set forth in a memorandum dated 

January 25, 1995 from John S. Seitz, Director, Office 

of Air Quality Planning and Standards, titled, 

‘‘Options for Limiting the Potential to Emit (PTE) of 

a Stationary Source Under Section 112 and Title V 

of the Clean Air Act (Act).’’ 

6. Enforceability Considerations 

For the reasons given above, we find 

the amendments to District Rules 2020 

and 2201 to be acceptable under 

applicable NSR regulations; however, 

SIP rules must also be enforceable [see 

CAA section 110(a)], and we find two 

specific deficiencies related to 

enforceability of Rules 2020 and 2201 

that prevent our full approval. These 

deficiencies arise from the ambiguity 

introduced by the references in both 

paragraph 6.20 (of Rule 2020) and 

paragraph 4.6.9 (of Rule 2201) to State 

law under circumstances where the 

State law has not been submitted to EPA 

for approval into the SIP. Specifically, 

paragraph 6.20 (of Rule 2020) provides 

a permitting exemption for: 

‘‘Agricultural sources, but only to the 

extent provided by California Health 

and Safety Code, Section 42301.16.’’ In 

turn, CH&SC section 42301.16 requires 

districts to extend permitting 

requirements to all agricultural sources 

that are ‘‘major’’ under the CAA and to 

all ‘‘minor’’ agricultural sources with 

actual emissions one-half of the 

applicable major source emissions 

thresholds (or greater) for any air 

contaminant, but excluding fugitive 

dust. However, subsection (b) of CH&SC 

section 42301.16 provides a means 

through which a district can extend the 

exemption from ‘‘one-half of any 

applicable emissions threshold’’ to the 

‘‘major source’’ threshold if certain 

findings are made in a public hearing. 

Because CH&SC section 42301.16 is 

not included in the California SIP, nor 

has California submitted the section to 

EPA for approval, the SIP would be 

ambiguous as to the extent of the 

agricultural source permitting 

exemption if EPA were to approve 

submitted District Rule 2020 into the 

SIP. Effective enforcement of the 

permitting requirements would rely on 

judicial notice of the statutory provision 

cited in the rule, and such judicial 

notice may or may not be forthcoming. 

There is no need to rely on judicial 

notice when the District can eliminate 

the ambiguity by clearly stating the 

exemption for agricultural sources in 

District Rule 2020 or by submitting 

CH&SC section 42301.16 to EPA for 

approval into the SIP. Moreover, even if 

we could assume that judicial notice of 

the statutory provision would be taken, 

CH&SC section 42301.16 by its terms 

allows for a relaxation of the one-half of 

major source permitting threshold for 

agricultural sources, and such 

relaxations should be reviewed by EPA 

under section 110 for approval as a SIP 

revision. Therefore, we are proposing a 

limited approval and limited 

disapproval of submitted Rule 2020. 

Paragraph 4.6.9 of submitted Rule 

2201 contains a similarly-ambiguous 

reference to State law in listing emission 

offset exemptions: ‘‘Agricultural sources, 

to the extent provided by California 

Health and Safety Code, section 

42301.18(c), except that nothing in this 

section shall circumvent the 

requirements of section 42301(a).’’ 

CH&SC section 42301.18(c) states: ‘‘A 

district may not require an agricultural 

source to obtain emissions offsets for 

criteria pollutants for that source if 

emissions reductions from that source 

would not meet the criteria for real, 

permanent, quantifiable, and 

enforceable emission reductions.’’ Our 

understanding is that the District has no 

plans to require emissions offsets for 

new or modified agricultural sources 

unless such new or modified source is 

a ‘‘Major Source’’ or a ‘‘Federal Major 

Modification’’ as defined in another 

section of Rule 2201. Once again, there 

is no need for ambiguity in the 

applicability of the emissions offset 

exemption, and therefore, EPA is 

proposing a limited approval and 

limited disapproval of submitted Rule 

2201. 

7. Federally Enforceable Restriction on 

Potential To Emit 

District Rule 2530 establishes limits to 

restrict the PTE of a stationary source so 

that the source may be exempt from the 

District’s rule implementing Title V 

operating permit requirements. The 

emission limits in section 6.1 of District 

Rule 2530 are intended to represent 

50% of the applicable major source 

threshold.14 With the change in the 

valley’s ozone classification to 

‘‘extreme’’ for the 1-hour ozone standard, 

and the corresponding lowering of the 

applicable major source threshold from 

25 tons per year to 10 tons per year, it 

follows that the District has amended 

Rule 2530 to change the corresponding 

emission limit in section 6.1 to 5 tons 

per year of VOC or NOX, to maintain the 

emission limit at 50% of the applicable 

major source threshold. Other emissions 

thresholds in District Rule 2530, such as 

those for exemptions from 

recordkeeping and reporting (20% of 

applicable major source threshold) and 

from reporting (25% of applicable major 

source threshold) have also been 

reduced accordingly. 

Certain alternative operational limits 

in section 6.2 of the rule, which were 

intended to allow sources using these 

types of limits to go up to 80% of the 

major source threshold (in actual 

emissions), were changed accordingly 

but certain other limits in section 6.2 

were left unchanged or were changed by 

a lesser proportion. The District 

explained how the values that were not 

revised downwards in proportion to the 

drop in the major source threshold met 

the underlying purpose of the provision 

allowing alternative operational limits, 

i.e., allowing certain types of sources to 

go up to 80% of the major source 

threshold (in actual emissions). For 

instance, the alternative operational 

limit of 7,000,000 gallons per year of 

gasoline dispensed at gasoline 

dispensing facilities with phase I and II 

vapor recovery systems, as set forth in 

paragraph 6.2.1 of Rule 2530, was left 

unchanged because it still is well below 

the 80% (of 10 tons per year) threshold 

for underground storage tanks (16.9 

million gallons per year) and for above 

ground storage tanks (12.2 million 

gallons per year). See District 

memorandum on Rule 2530 (dated 

December 18, 2009), which we have 

placed in the docket. 

Therefore, we find the changes to 

District Rule 2530 to be acceptable, and 

we propose to approve amended District 

Rule 2530, as submitted on March 17, 

2009, as a revision to the California SIP. 

8. CAA Section 110(l) 

The only remaining issue is whether 

this SIP revision would interfere with 

requirements concerning attainment and 

reasonable further progress (or any other 

applicable CAA requirement) as set 

forth in CAA section 110(l). CAA 

section 110(l) provides: ‘‘Each revision 

to an implementation plan submitted by 

a State under this chapter shall be 

adopted by such State after reasonable 

notice and public hearing. The 

administrator shall not approve a 

revision of a plan if the revision would 

interfere with any applicable 

requirement concerning attainment and 

reasonable further progress (as defined 

in section 7501 of this title) or any other 

applicable requirement of this chapter.’’ 

42 U.S.C. 7410(l). 

For the purposes of CAA section 

110(l), we take into account the overall 

effect of the revisions included in this 

action. Given the wide application of 

the lower major source thresholds to all 


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4756 Federal Register / Vol. 75, No. 19 / Friday, January 29, 2010 / Proposed Rules 

15 Kern County APCD, one of the original countybased APCDs covering San Joaquin Valley, was not 

entirely consolidated into the current unified 

District, but its jurisdiction is no longer countywide, and is limited to the eastern portion of the county. 

types of new or modified stationary 

sources of VOC and NOX and the 

limited extent of the exemptions from 

permitting and offsets for certain types 

of agricultural sources, we find that the 

overall effect of the revisions would 

strengthen the SIP, notwithstanding 

deficiencies identified above in 

enforceability. Moreover, we do not 

anticipate localized exceedances of the 

PM10 or PM2.5 standards, due to the 

permitting exemption for certain 

agricultural sources, given the 

application of non-permitting 

requirements in the SIP. Lastly, we note 

that the revisions are consistent with the 

assumptions of the various air quality 

plans developed for the valley. 

Accordingly, we conclude that the 

revisions to Rules 2020, 2201, and 2530, 

if approved, would not interfere with 

any applicable requirements for 

attainment and reasonable further 

progress or any other applicable 

requirement of the CAA and are 

approvable under section 110(l). 

9. Conclusion and Proposed Action on 

Submitted Rules 

For the reasons given above, under 

CAA section 110(k)(2) and 301(a), we 

are proposing a limited approval and 

limited disapproval of amended Rules 

2020 and 2201 because, although they 

would strengthen the SIP and meet all 

but one of the applicable requirements 

for SIPs in general and NSR SIPs in 

particular, they contain certain 

deficiencies related to enforceability 

that prevent our full approval. The 

deficiency in Rule 2020 can be 

remedied by the District by revision of 

Rule 2020 by replacing the statutory 

reference to CH&SC section 42301.16 in 

paragraph 6.20 with a clear description 

of the sources covered by the 

exemption. The deficiency in Rule 2201 

can be remedied by either submittal of 

the statutory provisions cited in 

paragraph 4.6.9 or by replacement of the 

references with a clear description of 

the applicability of the offset 

requirement to agricultural sources. For 

amended Rule 2530, we are proposing a 

full approval because we find that it has 

been appropriately modified to reflect 

the decrease in the major source 

threshold for VOC and NOX consistent 

with the area’s ‘‘extreme’’ classification 

for the 1-hour ozone standard. 

V. Deletion of Obsolete Conditions on 

SIP Approvals 

In the 1980s, EPA placed conditions, 

including conditions related to NSR, on 

approvals of certain California 

nonattainment plans. As to certain San 

Joaquin Valley plans, EPA approved the 

plans on the condition that the State of 

California submit revised NSR rules for 

the individual county-based Air 

Pollution Control Districts (APCDs), 

then having jurisdiction in San Joaquin 

Valley, as revisions to the California 

SIP. These NSR-related conditions are 

identified in table 3, below, by 

applicable county, EPA action, and CFR 

citation. 

On September 23, 1999, in an action 

proposing approval of previous versions 

of District Rules 2020 and 2201 (later 

superceded by a proposed rule 

published on September 28, 2000), we 

proposed to remove these conditions. 

See 64 FR 51493, at 51494 (September 

23, 1999). Specifically, we proposed to 

delete the conditions set forth in 40 CFR 

52.232(a)(5)(i)(A), (a)(6)(i)(A), 

(a)(10)(i)(A), and (a)(11)(i)(A). 

In our September 1999 proposed rule, 

we noted that the conditions required 

the prior county-based APCDs (now 

combined to form the San Joaquin 

Valley Unified Air Pollution Control 

District) 15 to submit regulations 

consistent with EPA regulations that 

were current at the time the conditions 

were established in 1981, 1982, and 

1985. We also noted that the conditions 

are moot today because the District has 

submitted revised NSR rules (i.e., Rules 

2020 and 2201) that comply with EPA’s 

current regulations and the Clean Air 

Act, as amended in 1990. However, we 

did not include the removal of these 

obsolete NSR-related conditions in the 

subsequent final rule on May 17, 2004 

(69 FR 27837) fully approving the 

District’s NSR rules, i.e., District Rules 

2020 and 2201. 

TABLE 3—OBSOLETE CONDITIONS PROPOSED FOR DELETION

County Conditional approval Federal Register citation Regulatory citation 

Kern County a ........................................................... 46 FR 42450 (August 21, 1981) ............................ 40 CFR 52.232(a)(5)(i)(A). 

San Joaquin County ................................................ 47 FR 19694 (May 7, 1982), amended at 50 FR 

7591 (February 25, 1985).

40 CFR 52.232(a)(6)(i)(A). 

Kings, Madera, Merced, Stanislaus, and Tulare 

Counties.

47 FR 19694 (May 7, 1982) .................................. 40 CFR 52.232(a)(10)(i)(A). 

Fresno County ......................................................... 47 FR 28617 (July 1, 1982) ................................... 40 CFR 52.232(a)(11)(i)(A). 

a In today’s document, we are proposing to remove the Kern County condition for carbon monoxide and ozone only. 

In today’s document, we are 

addressing the same provisions in 40 

CFR 52.232 as our 1999 proposed rule, 

but we are not proposing exactly the 

same action as before. Today, we 

recognize that the condition in 40 CFR 

52.232(a)(5)(i)(A) is obsolete as to 

carbon monoxide and ozone in light of 

the approval of District NSR rules in 

2004 (69 FR 27837, May 17, 2004), the 

change in the boundary for the 1-hour 

ozone nonattainment boundary for San 

Joaquin Valley (66 FR 56476, November 

8, 2001), and the redesignation of the 

East Kern County 1-hour ozone 

nonattainment area to attainment (69 FR 

21731, April 22, 2004). However, as to 

particulate matter, we find the condition 

to be unfulfilled because the Kern 

County APCD retains jurisdiction over a 

small portion of the San Joaquin Valley 

planning area, the portion of the San 

Joaquin Valley planning area over 

which Kern County APCD retains 

jurisdiction remains nonattainment for 

PM10 (see 73 FR 66759, November 12, 

2008), and because we have yet to 

approve a revision to Kern County 

APCD NSR rules that meet the condition 

in 40 CFR 52.232(a)(5)(i)(A). Therefore, 

we propose to amend 40 CFR 

52.232(a)(5)(i) to remove the references 

to carbon monoxide and ozone only. We 

will retain the condition as to 

particulate matter until we approve the 

Kern County APCD’s nonattainment 

NSR rules for the East Kern County 

PM10 nonattainment area or until we 

approve a redesignation request for the 

East Kern PM10 area to ‘‘attainment.’’ 

We are also proposing to remove the 

conditions set forth in 40 CFR 

52.232(a)(6)(i)(A), (a)(10)(i)(A), and 

(a)(11)(i)(A) as obsolete in light of the 

approval of District NSR rules in 2004 


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Federal Register / Vol. 75, No. 19 / Friday, January 29, 2010 / Proposed Rules 4757 

16The condition established in 40 CFR 

52.232(a)(11) also relates to Ventura County, but 

removal of the condition is proper as to Ventura 

County in light of EPA’s subsequent approval of the 

Ventura County nonattainment NSR rules at 68 FR 

9561 (February 28, 2003). 

(69 FR 27837, May 17, 2004).16 Unlike 

Kern County, the counties subject to the 

conditions in 40 CFR 52.232(a)(6), (10), 

and (11) (i.e., San Joaquin, Kings, 

Madera, Merced, Stanislaus, Tulare, and 

Fresno) all lie entirely within District 

jurisdiction. If we finalize this aspect of 

this action as proposed, we will be 

removing and reserving 40 CFR 

52.232(a)(6), (a)(10), and (a)(11) because 

the conditions proposed for removal are 

the last conditions on approval that 

remain. 

VI. Proposed Action and Opportunity 

for Public Comment 

For the reasons set forth above, we are 

proposing to correct a previous approval 

of San Joaquin Valley District NSR 

rules, Rule 2020 (‘‘Exemptions’’) and 

Rule 2210 (‘‘New and Modified 

Stationary Source Review Rule’’), to 

approve amended District Rule 2530 

(‘‘Federally Enforceable Potential to 

Emit’’), and to take a limited approval 

and limited approval action for 

amended District NSR Rules 2020 and 

2201. 

More specifically, we are proposing to 

correct our May 2004 final approval of 

revisions to the San Joaquin Valley 

Unified Air Pollution Control District 

portion of the California State 

Implementation Plan under section 

110(k)(6) of the Clean Air Act. We do so 

because, by virtue of information 

submitted by California to us in 

November 2003, we should have limited 

our approval consistent with the legal 

authority provided in State law to air 

districts to permit, and require offsets 

for, new or modified agricultural 

sources. To correct our error, we are 

proposing language to be added as a 

new section, 52.245, of 40 CFR part 52. 

Under CAA sections 110(k)(2) and 

301(a), we are proposing a limited 

approval and limited disapproval of 

amended District Rules 2020 and 2201, 

as submitted on March 7, 2008 and 

March 17, 2009, respectively. The 

amended District Rules 2020 and 2201 

would establish an exemption from 

permitting, and from offsets, for certain 

minor agricultural operations, would 

establish applicability thresholds (for 

major sources and major modifications) 

and offset thresholds consistent with a 

classification of ‘‘extreme’’ for the ozone 

standard, and would implement NSR 

Reform. We are proposing a limited 

approval and limited disapproval, 

because, although the amended rules 

meet most of the applicable 

requirements and strengthen the SIP, 

they contain unacceptably ambiguous 

references to statutory provisions. 

With respect to amended District Rule 

2530, as submitted on March 17, 2009, 

we are proposing full approval because 

we find that it has been appropriately 

modified to reflect the decrease in the 

major source threshold for VOC and 

NOX consistent with an ‘‘extreme’’ 

classification. 

Lastly, EPA is proposing to rescind 

conditions placed on 1980s era 

approvals by EPA on various 

nonattainment plans submitted by 

California for the San Joaquin Valley 

that have become obsolete by EPA 

approval of subsequent revisions to the 

District’s NSR rules. Therefore, we 

propose to amend 40 CFR 52.232(a)(5)(i) 

to remove the references to carbon 

monoxide and ozone and to remove and 

reserve 40 CFR 52.232(a)(6), (a)(10), and 

(a)(11). 

If EPA were to finalize the limited 

approval and limited disapproval 

action, as proposed, then a sanctions 

clock, and EPA’s obligation to 

promulgate a Federal implementation 

plan, would be triggered because the 

revisions to the District rules for which 

a limited approval and limited 

disapproval is proposed are required 

under anti-backsliding principles 

established for the transition from the 

1-hour to the 8-hour ozone standard. 

We will accept comments from the 

public on this proposal for the next 30 

days. 

VII. Statutory and Executive Order 

Reviews 

A. Executive Order 12866, Regulatory 

Planning and Review 

The Office of Management and Budget 

(OMB) has exempted this regulatory 

action from Executive Order 12866, 

entitled ‘‘Regulatory Planning and 

Review.’’ 

B. Paperwork Reduction Act 

This proposed action does not impose 

an information collection burden under 

the provisions of the Paperwork 

Reduction Act, 44 U.S.C. 3501 et seq. 

Burden is defined at 5 CFR 1320.3(b). 

C. Regulatory Flexibility Act 

The Regulatory Flexibility Act (RFA) 

generally requires an agency to conduct 

a regulatory flexibility analysis of any 

rule subject to notice and comment 

rulemaking requirements 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 not-for-profit enterprises, and 

small governmental jurisdictions. 

This proposed rule will not have a 

significant impact on a substantial 

number of small entities because SIP 

approvals under section 110 and 

subchapter I, part D of the Clean Air Act 

do not create any new requirements but 

simply approve requirements that the 

State is already imposing. Therefore, 

because the Federal SIP approval does 

not create any new requirements, I 

certify that this action will not have a 

significant economic impact on a 

substantial number of small entities. 

Moreover, due to the nature of the 

Federal-State relationship under the 

Clean Air Act, preparation of flexibility 

analysis would constitute Federal 

inquiry into the economic 

reasonableness of State action. The 

Clean Air Act forbids EPA to base its 

actions concerning SIPs on such 

grounds. Union Electric Co. v. U.S. EPA, 

427 U.S. 246, 255–66 (1976); 42 U.S.C. 

7410(a)(2). 

D. Unfunded Mandates Reform Act 

Under sections 202 of the Unfunded 

Mandates Reform Act of 1995 

(‘‘Unfunded Mandates Act’’), signed into 

law on March 22, 1995, EPA must 

prepare a budgetary impact statement to 

accompany any proposed or final rule 

that includes a Federal mandate that 

may result in estimated costs to State, 

local, or tribal governments in the 

aggregate; or to the private sector, of 

$100 million or more. Under section 

205, EPA must select the most costeffective and least burdensome 

alternative that achieves the objectives 

of the rule and is consistent with 

statutory requirements. Section 203 

requires EPA to establish a plan for 

informing and advising any small 

governments that may be significantly 

or uniquely impacted by the rule. 

EPA has determined that the 

proposed action does not include a 

Federal mandate that may result in 

estimated costs of $100 million or more 

to either State, local, or tribal 

governments in the aggregate, or to the 

private sector. This Federal action 

proposes to approve pre-existing 

requirements under State or local law, 

and imposes no new requirements. 

Accordingly, no additional costs to 

State, local, or tribal governments, or to 

the private sector, result from this 

action. 

E. Executive Order 13132, Federalism 

Federalism (64 FR 43255, August 10, 

1999) revokes and replaces Executive 

Orders 12612 (Federalism) and 12875 

(Enhancing the Intergovernmental 

Partnership). Executive Order 13132 


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4758 Federal Register / Vol. 75, No. 19 / Friday, January 29, 2010 / Proposed Rules 

requires EPA 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 

Executive Order 13132, EPA 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 EPA consults with 

State and local officials early in the 

process of developing the proposed 

regulation. EPA also may not issue a 

regulation that has Federalism 

implications and that preempts State 

law unless the Agency consults with 

State and local officials early in the 

process of developing the proposed 

regulation. 

This proposed rule will 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, because it 

merely proposes to approve a State rule 

implementing a Federal standard, and 

does not alter the relationship or the 

distribution of power and 

responsibilities established in the Clean 

Air Act. Thus, the requirements of 

section 6 of the Executive Order do not 

apply to this rule. 

F. Executive Order 13175, Coordination 

With Indian Tribal Governments 

Executive Order 13175, entitled 

‘‘Consultation and Coordination with 

Indian Tribal Governments’’ (65 FR 

67249, November 9, 2000), requires EPA 

to develop an accountable process to 

ensure ‘‘meaningful and timely input by 

tribal officials in the development of 

regulatory policies that have tribal 

implications.’’ This proposed rule does 

not have tribal implications, as specified 

in Executive Order 13175. It will not 

have substantial direct effects on tribal 

governments, on the relationship 

between the Federal government and 

Indian tribes, or on the distribution of 

power and responsibilities between the 

Federal government and Indian tribes. 

Thus, Executive Order 13175 does not 

apply to this rule. 

G. Executive Order 13045, Protection of 

Children From Environmental Health 

Risks and Safety Risks 

EPA interprets Executive Order 13045 

(62 FR 19885, April 23, 1997) as 

applying only to those regulatory 

actions that concern 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 rule is not subject to 

Executive Order 13045, because it 

proposes to approve a State rule 

implementing a Federal standard. 

H. Executive Order 13211, Actions That 

Significantly Affect Energy Supply, 

Distribution, or Use 

This rule is not subject to Executive 

Order 13211, ‘‘Actions Concerning 

Regulations That Significantly Affect 

Energy Supply, Distribution, or Use’’ (66 

FR 28355, May 22, 2001) because it is 

not a significant regulatory action under 

Executive Order 12866. 

I. National Technology Transfer and 

Advancement Act 

Section 12 of the National Technology 

Transfer and Advancement Act 

(NTTAA) of 1995 requires Federal 

agencies to evaluate existing technical 

standards when developing a new 

regulation. To comply with NTTAA, 

EPA must consider and use ‘‘voluntary 

consensus standards’’ (VCS) if available 

and applicable when developing 

programs and policies unless doing so 

would be inconsistent with applicable 

law or otherwise impractical. 

The EPA believes that VCS are 

inapplicable to this action. Today’s 

proposed action does not require the 

public to perform activities conducive 

to the use of VCS. 

List of Subjects in 40 CFR Part 52 

Environmental protection, Air 

pollution control, Intergovernmental 

relations, Ozone, Particulate matter, 

Reporting and recordkeeping 

requirements. 

Accordingly, 40 CFR part 52 is 

proposed to be amended as follows: 

PART 52—[AMENDED] 

1. The authority citation for part 52 

continues to read as follows: 

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

2. Section 52.245 is added to read as 

follows: 

§ 52.245 New source review rules. 

(a) Approval of the New Source 

Review rules for the San Joaquin Valley 

Unified Air Pollution Control District 

Rules 2020 and 2201 as approved May 

17, 2004, is limited, as it relates to 

agricultural sources, to apply the permit 

requirement only: 

(1) To agricultural sources with 

potential emissions at or above a major 

source applicability threshold; and 

(2) To agricultural sources with actual 

emissions at or above 50 percent of a 

major source applicability threshold. 

(b) The offset requirement, as it relates 

to agricultural sources, does not apply 

to new minor agricultural sources and 

minor modifications to agricultural 

sources. 

Dated: January 21, 2010. 

Jared Blumenfeld, 

Regional Administrator, Region IX. 

[FR Doc. 2010–1838 Filed 1–28–10; 8:45 am] 

BILLING CODE 6560–50–P 

ENVIRONMENTAL PROTECTION 

AGENCY 

40 CFR Part 52 

[EPA–R08–OAR–2009–0198; FRL–9102–8] 

Approval and Promulgation of Air 

Quality Implementation Plans; 

Montana; Revisions to the 

Administrative Rules of Montana 

AGENCY: Environmental Protection 

Agency (EPA). 

ACTION: Proposed rule. 

SUMMARY: EPA is proposing to approve 

State Implementation Plan (SIP) 

revisions submitted by the State of 

Montana on January 16, 2009 and May 

4, 2009. The revisions are to the 

Administrative Rules of Montana. 

Revisions include minor editorial and 

grammatical changes, updates to the 

citations and references to Federal and 

State laws and regulations, and a 

clarification of agricultural activities 

exempt from control of emissions of 

airborne particulate matter. This action 

is being taken under section 110 of the 

Clean Air Act. 

DATES: Written comments must be 

received on or before March 1, 2010. 

ADDRESSES: Submit your comments, 

identified by Docket ID No. EPA–R08– 

OAR–2009–0198, by one of the 

following methods: 

• http://www.regulations.gov. Follow 

the online instructions for submitting 

comments. 

• E-mail: dolan.kathy@epa.gov. 

• Fax: (303) 312–6064 (please alert 

the individual listed in the FOR FURTHER

INFORMATION CONTACT if you are faxing 

comments). 

• Mail: Director, Air Program, 

Environmental Protection Agency 


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