[Federal Register Volume 72, Number 88 (Tuesday, May 8, 2007)]
[Proposed Rules]
[Pages 26057-26068]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E7-8772]


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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Parts 52 and 81

[EPA-R05-OAR-2006-0715; FRL-8310-9]


Determination of Attainment, Approval and Promulgation of 
Implementation Plans and Designation of Areas for Air Quality Planning 
Purposes; Indiana; Redesignation of the Clark and Floyd Counties 8-Hour 
Nonattainment Area to Attainment for Ozone

AGENCY: Environmental Protection Agency (EPA).

ACTION: Proposed rule.

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SUMMARY: On November 15, 2006, the Indiana Department of Environmental 
Management (IDEM) submitted a request to redesignate the Indiana 
portion of the Louisville 8-hour ozone National Ambient Air Quality 
Standard (NAAQS) nonattainment area (Clark and Floyd Counties) to 
attainment for the 8-hour ozone NAAQS, and a request for EPA approval 
of a 14-year maintenance plan for Clark and Floyd Counties. Today, EPA 
is making a determination that the Indiana portion of the Louisville 8-
hour ozone nonattainment area has attained the 8-hour ozone NAAQS. This 
determination is based on three years of complete, quality-assured 
ambient air quality monitoring data for the 2003-2005 ozone seasons 
that demonstrate that the 8-hour ozone NAAQS has been attained in the 
area. EPA is proposing to approve the request to redesignate Clark and 
Floyd Counties to attainment of the 8-hour ozone standard based on its 
determination that the Louisville 8-hour ozone nonattainment area has 
met the criteria for redesignation to attainment specified in the Clean 
Air Act (CAA). EPA is also proposing to approve Indiana's maintenance 
plan which adequately supports continued attainment through 2020 and, 
for purposes of transportation conformity, the Volatile Organic 
Compounds (VOC) and Nitrogen Oxides (NO<INF>X</INF>) Motor Vehicle 
Emission Budgets (MVEBs) for the year 2003 and 2020.

DATES: Comments must be received on or before June 7, 2007.

ADDRESSES: Submit your comments, identified by Docket ID No. EPA-R05-
OAR-2006-0715, by one of the following methods:
    <bullet> http://www.regulations.gov: Follow the on-line 
instructions for submitting comments.
    <bullet> E-mail: <a href="/cdn-cgi/l/email-protection#e78a888889829ec98d888f89a7829786c9808891"><span class="__cf_email__" data-cfemail="c5a8aaaaaba0bcebafaaadab85a0b5a4eba2aab3">[email protected]</span></a>.
    <bullet> Fax: (312) 886-5824.
    <bullet> Mail: John M. Mooney, Chief, Criteria Pollutant Section, 
Air Programs Branch (AR-18J), U.S. Environmental Protection Agency, 77 
West Jackson Boulevard, Chicago, Illinois 60604.
    <bullet> Hand Delivery: John M. Mooney, Chief, Criteria Pollutant 
Section, Air Programs Branch (AR-18J), U.S. Environmental Protection 
Agency, 77 West Jackson Boulevard, Chicago, Illinois. Such deliveries 
are only accepted during the Regional Office's normal hours of 
operation, and special arrangements should be made for deliveries of 
boxed information. The Regional Office's official hours of operation 
are Monday through Friday, 8:30 a.m. to 4:30 p.m. excluding Federal 
holidays.
    Instructions: Direct your comments to Docket ID No. EPA-R05-OAR-
2006-

[[Page 26058]]

0715. EPA's policy is that all comments received 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 information claimed to be 
Confidential Business Information (CBI) or other information whose 
disclosure is restricted by statute. Do not submit information that you 
consider to be CBI, or otherwise protected, through http://www.regulations.gov or e-mail. The http://www.regulations.gov website 
is an ``anonymous access'' system, which means EPA will not know your 
identity or contact information unless you provide it in the body of 
your comment. If you send an e-mail comment directly to EPA without 
going through http://www.regulations.gov, your e-mail address will be 
automatically captured and included as part of the comment that is 
placed in the public docket and made available on the Internet. If you 
submit an electronic comment, EPA recommends that you include your name 
and other contact information in the body of your comment and with any 
disk or CD-ROM you submit. 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. Electronic files should avoid 
the use of special characters and any form of encryption, and should be 
free of any defects or viruses.
    Docket: All documents in the docket are listed in the http://www.regulations.gov index. Although listed in the index, some 
information is not publicly available, e.g., CBI or other information 
whose disclosure is restricted by statute. Certain other material, such 
as copyrighted material, will be publicly available only in hardcopy. 
Publicly available docket materials are available either electronically 
in http://www.regulations.gov or in hardcopy at the Environmental 
Protection Agency, Region 5, Air and Radiation Division, 77 West 
Jackson Boulevard, Chicago, Illinois 60604. This facility is open from 
8:30 a.m. to 4:30 p.m., Monday through Friday, excluding Federal 
holidays. It is recommended that you telephone Steven Rosenthal, 
Environmental Engineer, at (312) 886-6052, before visiting the Region 5 
office.

FOR FURTHER INFORMATION CONTACT: Steven Rosenthal, Environmental 
Engineer, Criteria Pollutant Section, Air Programs Branch (AR-18), 
Environmental Protection Agency, Region 5, 77 West Jackson Boulevard, 
Chicago, Illinois 60604, (312) 886-6052, <a href="/cdn-cgi/l/email-protection#3c4e534f595248545d50124f48594a59527c594c5d125b534a"><span class="__cf_email__" data-cfemail="beccd1cddbd0cad6dfd290cdcadbc8dbd0fedbcedf90d9d1c8">[email protected]</span></a>.

SUPPLEMENTARY INFORMATION: Throughout this document whenever ``we,'' 
``us,'' or ``our'' is used, we mean the EPA. This supplementary 
information section is arranged as follow:

I. What Action Is EPA Proposing to Take?
II. What Is the Background for This Action?
III. What Are the Criteria for Redesignation to Attainment?
IV. What Are EPA's Analyses of the State's Redesignation Request and 
What Are the Bases for EPA's Proposed Action?
V. Has Indiana Adopted Acceptable Motor Vehicle Emissions Budgets 
for the End of the 14-Year Maintenance Plan Which Can Be Used To 
Support Conformity Determinations?
VI. What Is the Effect of EPA's Proposed Action?
VII. Statutory and Executive Order Reviews

I. What Action Is EPA Proposing to Take?

    We are proposing to take several related actions for the Indiana 
portion of the Louisville 8-hour nonattainment area (Clark and Floyd 
Counties). First, we are proposing to determine that Clark and Floyd 
Counties have attained the 8-hour ozone NAAQS based on air quality for 
the period of 2003 through 2005. Second, we are proposing to approve 
Indiana's ozone maintenance plan for Clark and Floyd Counties as a 
revision of the Indiana SIP. The maintenance plan is designed to keep 
Clark and Floyd Counties in attainment of the 8-hour ozone standard 
through 2020 by ensuring that the VOC and NO<INF>X</INF> emissions in 
both Clark and Floyd Counties and the entire Louisville area will be 
lower in 2020 than in 2003, an attainment year. As supported by and 
consistent with the ozone maintenance plan, we are also proposing to 
approve the 2003 and the 2020 VOC and NO<INF>X</INF> MVEBs for the 
Louisville area for transportation conformity purposes. We are also 
proposing to approve the request from the State of Indiana to change 
the designation of Clark and Floyd Counties from nonattainment to 
attainment of the 8-hour ozone NAAQS. We have determined that Indiana 
and Clark and Floyd Counties have met the requirements for 
redesignation to attainment under section 107(d)(3)(E) of the Clean Air 
Act (CAA).

II. What Is the Background for This Action?

A. General Background Information

    EPA has determined that ground-level ozone is detrimental to human 
health. On July 18, 1997, EPA promulgated an 8-hour ozone NAAQS of 0.08 
parts per million parts of air (0.08 ppm) (80 parts per billion (ppb)) 
(62 FR 38856).\1\ This 8-hour ozone standard replaced a prior 1-hour 
ozone NAAQS, which had been promulgated on February 8, 1979 (44 FR 
8202), and which was revoked on June 15, 2005 (69 FR 23858).
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    \1\ This standard is violated in an area when any ozone monitor 
in the area (or in its impacted downwind environs) records 8-hour 
ozone concentrations with an average of the annual fourth-highest 
daily maximum 8-hour ozone concentrations over a three-year period 
equaling or exceeding 85 ppb. 40 CFR 50.10.
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    Ground-level ozone is not emitted directly by sources. Rather, 
emitted NO<INF>X</INF> and VOC react in the presence of sunlight to 
form ground-level ozone along with other secondary compounds. 
NO<INF>X</INF> and VOC are referred to as ``ozone precursors.'' Control 
of ground-level ozone concentrations is achieved through controlling 
VOC and NO<INF>X</INF> emissions.
    The CAA required EPA to designate as nonattainment any area that 
violated the 8-hour ozone NAAQS. The Federal Register notice 
promulgating these designations and classifications was published on 
April 30, 2004 (69 FR 23857).
    The CAA contains two sets of provisions--subpart 1 and subpart 2--
that address planning and emission control requirements for 
nonattainment areas. Both are found in title I, part D of the CAA. 
Subpart 1 contains general, less prescriptive requirements for all 
nonattainment areas for any pollutant governed by a NAAQS. Subpart 2 
contains more specific requirements for certain ozone nonattainment 
areas, and applies to ozone nonattainment areas classified under 
section 181 of the CAA.
    In the April 30, 2004, designation rulemaking, EPA divided 8-hour 
ozone nonattainment areas into the categories of subpart 1 
nonattainment (``basic'' nonattainment) and subpart 2 nonattainment 
(``classified'' nonattainment). EPA based this division on the area's 
8-hour ozone design values (i.e., on the three-year averages of the 
annual fourth-highest daily maximum 8-hour ozone concentrations at the 
worst-case monitoring sites in the areas) and on their 1-hour ozone 
design values (i.e., on the fourth-highest daily maximum 1-hour ozone 
concentrations over the three-year period at the worst-case monitoring 
sites in the areas).\2\ EPA classified 8-hour ozone nonattainment areas 
with 1-hour ozone design values equaling or exceeding 121 ppb as

[[Page 26059]]

subpart 2, classified nonattainment areas. EPA classified all other 8-
hour nonattainment areas as subpart 1, basic nonattainment areas. The 
basis for area classification was explained in a separate April 30, 
2004 final rule (the Phase 1 implementation rule) (69 FR 23951).
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    \2\ The 8-hour ozone design value and the 1-hour ozone design 
value for each area were not necessarily recorded at the same 
monitoring site. The worst-case monitoring site for each ozone 
concentration averaging time was considered for each area.
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    Emission control requirements for classified nonattainment areas 
are linked to area classifications. Areas with more serious ozone 
pollution problems are subject to more prescribed requirements and 
later attainment dates. The prescribed emission control requirements 
are designed to bring areas into attainment by their specified 
attainment dates.
    In the April 30, 2004 ozone designation/classification rulemaking, 
EPA designated the Louisville nonattainment area, including Clark and 
Floyd Counties as a subpart 1 basic nonattainment area for the 8-hour 
ozone NAAQS. EPA based the designation on ozone data collected during 
the 2001-2003 period.
    On November 15, 2006, the State of Indiana requested redesignation 
of Clark and Floyd Counties to attainment of the 8-hour ozone NAAQS 
based on ozone data collected in these counties from 2003-2005.

B. What Is the Impact of the December 22, 2006 United States Court of 
Appeals Decision Regarding EPA's Phase 1 Implementation Rule?

1. Summary of Court Decision
    On December 22, 2006, the U.S. Court of Appeals for the District of 
Columbia Circuit vacated EPA's Phase 1 Implementation Rule for the 8-
hour Ozone Standard. (69 FR 23951, April 30, 2004). South Coast Air 
Quality Management Dist. v. EPA, 472 F.3d 882 (D.C. Cir. 2006). The 
Court held that certain provisions of EPA's Phase 1 Rule were 
inconsistent with the requirements of the Clean Air Act. The Court 
rejected EPA's reasons for implementing the 8-hour standard in 
nonattainment areas under Subpart 1 in lieu of subpart 2 of Title I, 
part D of the Act. The Court also held that EPA improperly failed to 
retain four measures required for 1-hour nonattainment areas under the 
anti-backsliding provisions of the regulations: (1) Nonattainment area 
New Source Review (NSR) requirements based on an area's 1-hour 
nonattainment classification; (2) Section 185 penalty fees for 1-hour 
severe or extreme nonattainment areas; (3) measures to be implemented 
pursuant to section 172(c)(9) or 182(c)(9)of the Act, on the 
contingency of an area not making reasonable further progress toward 
attainment of the 1-hour NAAQS, or for failure to attain that NAAQS; 
and (4) certain conformity requirements for certain types of Federal 
actions. The Court upheld EPA's authority to revoke the 1-hour standard 
provided there were adequate anti-backsliding provisions.
    This section sets forth EPA's views on the potential effect of the 
Court's ruling on this redesignation action. For the reasons set forth 
below, EPA does not believe that the Court's ruling alters any 
requirements relevant to this redesignation action so as to preclude 
redesignation, and does not prevent EPA from finalizing this 
redesignation. EPA believes that the Court's decision, as it currently 
stands or as it may be modified based upon any petition for rehearing 
that has been filed, imposes no impediment to moving forward with 
redesignation of this area to attainment, because in either 
circumstance redesignation is appropriate under the relevant 
redesignation provisions of the Act and longstanding policies regarding 
redesignation requests.
2. Requirements Under the 8-Hour Standard
    With respect to the 8-hour standard, the Court's ruling rejected 
EPA's reasons for classifying areas under Subpart 1 for the 8-hour 
standard, and remanded that matter to the Agency. Consequently, it is 
possible that this area could, during a remand to EPA, be reclassified 
under Subpart 2. Although any future decision by EPA to classify this 
area under Subpart 2 might trigger additional future requirements for 
the area, EPA believes that this does not mean that redesignation 
cannot now go forward. This belief is based upon (1) EPA's longstanding 
policy of evaluating State submissions in accordance with the 
requirements due at the time the request is submitted; and, (2) 
consideration of the inequity of applying retroactively any future 
requirements.
    First, at the time the redesignation request was submitted, Clark 
and Floyd Counties (and the entire Louisville area) were classified 
under Subpart 1 and were obligated to meet Subpart 1 requirements. 
Under EPA's longstanding interpretation of section 107(d)(3)(E) of the 
Clean Air Act, to qualify for redesignation, states requesting 
redesignation to attainment must meet only the relevant SIP 
requirements that came due prior to the submittal of a complete 
redesignation request. September 4, 1992, Calcagni memorandum 
(``Procedures for Processing Requests to Redesignate Areas to 
Attainment,'' Memorandum from John Calcagni, Director, Air Quality 
Management Division) See also Michael Shapiro Memorandum, September 17, 
1993, and 60 FR 12459, 12465-66 (March 7, 1995) (Redesignation of 
Detroit-Ann Arbor). See Sierra Club v. EPA, 375 F.3d 537 (7th Cir. 
2004), which upheld this interpretation. See, e.g. also 68 FR 25418, 
25424, 25427 (May 12, 2003) (redesignation of St. Louis).
    Moreover, it would be inequitable to retroactively apply any new 
SIP requirements that were not applicable at the time the request was 
submitted. The DC Circuit has recognized the inequity in such 
retroactive rulemaking, See Sierra Club v. Whitman, 285 F.3d 63 (DC 
Cir. 2002), in which the DC Circuit upheld a District Court's ruling 
refusing to make retroactive an EPA determination of nonattainment that 
was past the statutory due date. Such a determination would have 
resulted in the imposition of additional requirements on the area. The 
Court stated: ``Although EPA failed to make the nonattainment 
determination within the statutory time frame, Sierra Club's proposed 
solution only makes the situation worse. Retroactive relief would 
likely impose large costs on the States, which would face fines and 
suits for not implementing air pollution prevention plans in 1997, even 
though they were not on notice at the time.'' Id. at 68. Similarly here 
it would be unfair to penalize the area by applying to it for purposes 
of redesignation additional SIP requirements under Subpart 2 that were 
not in effect at the time it submitted its redesignation request.
3. Requirements Under the 1-Hour Standard
    With respect to the requirements under the 1-hour standard, Clark 
and Floyd Counties were attainment areas subject to a Clean Air Act 
section 175A maintenance plan under the 1-hour standard. The Court's 
ruling does not impact redesignation requests for these types of areas.
    First, there are no conformity requirements that are relevant for 
redesignation requests for any standard, including the requirement to 
submit a transportation conformity SIP \3\. Under longstanding EPA 
policy, EPA believes that it is reasonable to interpret the conformity 
SIP requirement as not applying for purposes of evaluating a 
redesignation request under section

[[Page 26060]]

107(d) because state conformity rules are still required after 
redesignation and Federal conformity rules apply where state rules have 
not been approved. 40 CFR 51.390. See Wall v. EPA, 265 F.3d 426 (6th 
Cir. 2001), upholding this interpretation. See also 60 FR 62748 (Dec. 
7, 1995) (Tampa, FL redesignation). Federal transportation conformity 
regulations apply in all States prior to approval of transportation 
conformity SIPs. The 1-hour ozone areas in Indiana were redesignated to 
attainment without approved State transportation conformity regulations 
because the Federal regulations were in effect in Indiana. When 
challenged, these 1-hour ozone redesignations, which were approved 
without State regulations, were upheld by the courts. See Wall v. EPA, 
265 F.3d 426 (6th Cir. 2001). See also 60 FR 62748 (December 7, 1995) 
(Tampa, Florida). Although Indiana does not have approved State 
transportation conformity regulations, it has developed memoranda of 
understanding, signed by all parties involved in conformity, to address 
conformity consultation procedures. The Federal transportation 
conformity regulations, which apply in Indiana, require the approved 1-
hour ozone budgets to be used for transportation conformity purposes 
prior to 8-hour ozone budgets being approved.
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    \3\ Clean Air Act section 176(c)(4)(E) currently requires States 
to submit revisions to their SIPs to reflect certain Federal 
criteria and procedures for determining transportation conformity. 
Transportation conformity SIPs are different from the motor vehicle 
emissions budgets that are established in control strategy SIPs and 
maintenance plans.
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    Second, with respect to the three other anti-backsliding provisions 
for the 1-hour standard that the Court found were not properly 
retained, Clark and Floyd Counties are attainment areas subject to a 
maintenance plan for the 1-hour standard, and the NSR, contingency 
measure (pursuant to section 172(c)(9) or 182(c)(9)) and fee provision 
requirements no longer apply to an area that has been redesignated to 
attainment of the 1-hour standard.
    Thus, the decision in South Coast should not alter requirements 
that would preclude EPA from finalizing the redesignation of this area.

III. What Are the Criteria for Redesignation to Attainment?

    The CAA provides the requirements for redesignating a nonattainment 
area to attainment. Specifically, section 107(d)(3)(E) of the CAA 
allows for redesignation provided that: (1) The Administrator 
determines that the area has attained the applicable NAAQS; (2) the 
Administrator has fully approved an applicable state implementation 
plan for the area under section 110(k) of the CAA; (3) the 
Administrator determines that the improvement in air quality is due to 
permanent and enforceable emission reductions resulting from 
implementation of the applicable SIP, Federal air pollution control 
regulations, and other permanent and enforceable emission reductions; 
(4) the Administrator has fully approved a maintenance plan for the 
area meeting the requirements of section 175A of the CAA; and (5) the 
state containing the area has met all requirements applicable to the 
area under section 110 and part D of the CAA.
    EPA provided guidance on redesignations in the General Preamble for 
the Implementation of Title I of the CAA Amendments of 1990 on April 
16, 1992 (57 FR 13498), and supplemented this guidance on April 28, 
1992 (57 FR 18070). The two main policy guidelines affecting the review 
of ozone redesignation requests are the following: ``Procedures for 
Processing Requests to Redesignate Areas to Attainment,'' Memorandum 
from John Calcagni, Director, Air Quality Management Division, 
September 4, 1992 (September 4, 1992 Calcagni memorandum); and, 
``Reasonable Further Progress, Attainment Demonstration, and Related 
Requirements for Ozone Nonattainment Areas Meeting the Ozone National 
Ambient Air Quality Standard,'' Memorandum from John S. Seitz, 
Director, Office of Air Quality Planning and Standards, May 10, 1995. 
For additional policy guidelines used in the review of ozone 
redesignation requests, see our proposed rule for the redesignation of 
the Evansville, Indiana ozone nonattainment area at 70 FR 53606 
(September 9, 2005).

IV. What Are EPA's Analyses of the State's Redesignation Request and 
What Are the Bases for EPA's Proposed Action?

    EPA is proposing to: (1) Determine that Clark and Floyd Counties 
have attained the 8-hour ozone standard; (2) approve the ozone 
maintenance plan for Clark and Floyd Counties and the VOC and 
NO<INF>X</INF> MVEBs supported by this maintenance plan; and (3) 
approve the redesignation of Clark and Floyd to attainment of the 8-
hour ozone NAAQS. The bases for our proposed determination and 
approvals follow.

A. Louisville Has Attained the 8-Hour Ozone NAAQS

    For ozone, an area may be considered to be attaining the 8-hour 
ozone NAAQS if there are no violations of the NAAQS, as determined in 
accordance with 40 CFR 50.10 and appendix I, based on the most recent 
three complete, consecutive calendar years of quality-assured air 
quality monitoring data at all ozone monitoring sites in the area and 
in its nearby downwind environs. To attain this standard, the average 
of the annual fourth-high daily maximum 8-hour average ozone 
concentrations measured and recorded at each monitor (the monitoring 
site's ozone design value) within the area and in its nearby downwind 
environs over the three-year period must not exceed the ozone standard. 
Based on an ozone data rounding convention described in 40 CFR part 50, 
appendix I, the 8-hour standard is attained if the area's ozone design 
value \4\ is 0.084 ppm (84 ppb) or lower. The data must be collected 
and quality-assured in accordance with 40 CFR part 58, and must be 
recorded in EPA's Air Quality System (AQS). The ozone monitors 
generally should have remained at the same locations for the duration 
of the monitoring period required to demonstrate attainment (for three 
years or more). The data supporting attainment of the standard must be 
complete in accordance with 40 CFR part 50, appendix I.
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    \4\ The worst-case monitoring site-specific ozone design value 
in the area or in its affected downwind environs.
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    Indiana submitted ozone monitoring data for the April through 
September ozone seasons from 2003 to 2005 for the Indiana and Kentucky 
portions of the Louisville nonattainment area. This data has been 
quality assured by Indiana and Kentucky and is recorded in AQS. The 4th 
high averages are summarized in Table 1, in which the values are in ppm 
ozone.

                                     Table 1.--4th high values in ppm ozone.
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              Monitor                       County         2003-2005     2003       2004       2005       2006
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Charlestown, IN...................  Clark................      0.081      0.090      0.074      0.080      0.079

[[Page 26061]]

 
New Albany, IN....................  Floyd................      0.079      0.086      0.071      0.079      0.076
WLKY, KY..........................  Jefferson............      0.071      0.073      0.068      0.074      0.067
Watson, KY........................  Jefferson............      0.076      0.075      0.070      0.085      0.077
Bates, KY.........................  Jefferson............      0.073      0.072      0.070      0.079      0.074
Shepherdsville, KY................  Bulitt...............      0.073      0.072      0.068      0.080      0.071
Buckner, KY.......................  Oldham...............      0.082      0.082      0.076      0.089      0.083
----------------------------------------------------------------------------------------------------------------

    These data show that the average fourth-high daily maximum 8-hour 
ozone concentrations for the monitoring sites in the Louisville area 
are all below the 85 ppb ozone standard violation cut-off. The data 
support the conclusion that the Louisville 8-hour ozone nonattainment 
area (including Clark and Floyd Counties) did not experience a 
monitored violation of the 8-hour ozone standard from 2003-2005. In 
addition, the surrounding counties in Indiana and Kentucky did not 
monitor nonattainment during the 2003-2005 period. As also noted in 
Table 1, the 8-hour ozone NAAQS continued to be attained in the 
Louisville area through 2006.
    Indiana has committed to continue ozone monitoring at the sites in 
Clark and Floyd Counties. IDEM also commits to consult with the EPA 
prior to making any changes in the existing monitoring network. In 
summary, EPA believes that the data submitted by Indiana provide an 
adequate demonstration that the Louisville area attains the 8-hour 
ozone NAAQS.

B. Clark and Floyd Counties Have Met All Applicable Requirements Under 
Section 110 and Part D of the CAA and the Area Has a Fully Approved SIP 
Under Section 110(k) of the CAA

    EPA has determined that Indiana has met all currently applicable 
SIP requirements for Clark and Floyd Counties under section 110 of the 
CAA (general SIP requirements). EPA has determined that the Indiana SIP 
meets currently applicable SIP requirements under part D of title I of 
the CAA (requirements specific to subpart 1 and subpart 2 ozone 
nonattainment areas). See section 107(d)(3)(E)(v) of the CAA. In 
addition, EPA has determined that the Indiana SIP is fully approved 
with respect to all applicable requirements. See section 
107(d)(3)(E)(ii) of the CAA. In making these determinations, EPA 
ascertained what requirements are applicable to the area, and 
determined that the applicable portions of the SIP meeting these 
requirements are fully approved under section 110(k) of the CAA. We 
note that SIPs must be fully approved only with respect to currently 
applicable requirements of the CAA, those CAA requirements applicable 
to Clark and Floyd Counties at the time the State submitted the final, 
complete ozone redesignation request for this area.
1. Clark and Floyd Counties Have Met All Applicable Requirements Under 
Section 110 and Part D of the CAA
    The September 4, 1992 Calcagni memorandum describes EPA's 
interpretation of section 107(D)(3)(E) of the CAA. Under this 
interpretation, to qualify for redesignation of an area to attainment, 
the State and the area must meet the relevant CAA requirements that 
come due prior to the State's submittal of a complete redesignation 
request for the area. See also a September 17, 1993, memorandum from 
Michael Shapiro, Acting Assistant Administrator for Air and Radiation, 
``State Implementation Plan (SIP) Requirements for Areas Submitting 
Requests for Redesignation to Attainment of the Ozone and Carbon 
Monoxide (CO) National Ambient Air Quality Standards (NAAQS) On or 
After November 15, 1992'' and 66 FR 12459, 12465-12466 (March 7, 1995) 
(redesignation of Detroit-Ann Arbor, Michigan to attainment of the 1-
hour ozone NAAQS). Applicable requirements of the CAA that come due 
subsequent to the State's submittal of a complete redesignation request 
remain applicable until a redesignation to attainment of the standard 
is approved, but are not required as a prerequisite to redesignation. 
See section 175A(c) of the CAA. Sierra Club v. EPA, 375 F.3d 537 (7th 
Cir. 2004). See also 68 FR 25424, 25427 (May 12, 2003) (redesignation 
of the St. Louis/East St. Louis area to attainment of the 1-hour ozone 
NAAQS).
    General SIP requirements: Section 110(a) of title I of the CAA 
contains the general requirements for a SIP, which include: enforceable 
emission limitations and other control measures, means, or techniques; 
provisions for the establishment and operation of appropriate devices 
necessary to collect data on ambient air quality; and programs to 
enforce the emission limitations. SIP elements and requirements are 
specified in section 110(a)(2) of title I, part A of the CAA. These 
requirements and SIP elements include, but are not limited to, the 
following: (a) Submittal of a SIP that has been adopted by the State 
after reasonable public notice and a hearing; (b) provisions for 
establishment and operation of appropriate procedures needed to monitor 
ambient air quality; (c) implementation of a source permit program; (d) 
provisions for the implementation of new source part C requirements 
(Prevention of Significant Deterioration (PSD)) and new source part D 
requirements (New Source Review (NSR)); (e) criteria for stationary 
source emission control measures, monitoring, and reporting; (f) 
provisions for air quality modeling; and (g) provisions for public and 
local agency participation.
    SIP requirements and elements are discussed in the following EPA 
documents: ``Procedures for Processing Requests to Redesignate Areas to 
Attainment,'' Memorandum from John Calcagni, Director, Air Quality 
Management Division, September 4, 1992; ``State Implementation Plan 
(SIP) Actions Submitted in Response to Clean Air Act (CAA) Deadlines,'' 
Memorandum from John Calcagni, Director, Air Quality Management 
Division, October 28, 1992; and ``State Implementation Plan (SIP) 
Requirements for Areas Submitting Requests for Redesignation to 
Attainment of the Ozone and Carbon Monoxide (CO) National Ambient Air 
Quality Standards (NAAQS) on or After November 15, 1992,'' Memorandum 
from Michael H. Shapiro, Acting Assistant Administrator, September 17, 
1993.
    Section 110(a)(2)(D) of the CAA requires SIPs to contain certain 
measures to prevent sources in one State from significantly 
contributing to air quality problems in another State. To implement 
this provision, EPA required States to establish programs to address 
transport of air pollutants (NO<INF>X</INF> SIP call,

[[Page 26062]]

Clean Air Interstate Rule (CAIR)). EPA has also found, generally, that 
states have not submitted SIPs under section 110(a)(1) of the CAA to 
meet the interstate transport requirements of section 110(a)(2)(D)(i) 
of the CAA (70 FR 21147, April 25, 2005). However, the section 
110(a)(2)(D) requirements for a State are not linked with a particular 
nonattainment area's classification. EPA believes that the requirements 
linked with a particular nonattainment area's classification are the 
relevant measures to evaluate in reviewing a redesignation request. The 
transport SIP submittal requirements, where applicable, continue to 
apply to a State regardless of the designation of any one particular 
area in the State.
    These requirements should not be construed to be applicable 
requirements for purposes of redesignation. In addition, the other 
section 110 elements described above that are not connected with 
nonattainment plan submissions and that are not linked with an area's 
attainment status are also not applicable requirements for purposes of 
redesignation. A State remains subject to these requirements after an 
area is redesignated to attainment. We conclude that only the section 
110 and part D requirements which are linked with an area's designation 
and classification are the relevant measures in evaluating this aspect 
of a redesignation request. This approach is consistent with EPA's 
existing policy on applicability of conformity and oxygenated fuels 
requirements for redesignation purposes, as well as with section 184 
ozone transport requirements. See: Reading, Pennsylvania proposed and 
final rulemakings (61 FR 53174-53176, October 10, 1996 and 62 FR 24826, 
May 7, 1997); Cleveland-Akron-Loraine, Ohio final rulemaking (61 FR 
20458, May 7, 1996); and Tampa, Florida final rulemaking (60 FR 62748, 
December 7, 1995). See also the discussion on this issue in the 
Cincinnati, Ohio ozone redesignation (65 FR 37890, June 19, 2000), and 
the Pittsburgh, Pennsylvania ozone redesignation (66 FR 50399, October 
19, 2001). In addition, Indiana's response to the CAIR rule was due in 
September 2006. Because this deadline had not yet passed when the State 
submitted the final, complete redesignation request, the State's CAIR 
submittal is also not an applicable requirement for redesignation 
purposes.
    It should be noted that section 110 elements not linked to the 
area's nonattainment status are not applicable for purposes of 
redesignation. Nonetheless, we also note that EPA has previously 
approved provisions in the Indiana SIP addressing section 110 elements 
under the 1-hour ozone standard. We have analyzed the Indiana SIP as 
codified in 40 CFR part 52, subpart P, and have determined that it is 
consistent with the requirements of section 110(a)(2) of the CAA. The 
SIP, which has been adopted after reasonable public notice and hearing, 
contains enforceable emission limitations; requires monitoring, 
compiling, and analyzing ambient air quality data; requires 
preconstruction review of new major stationary sources and major 
modifications of existing sources; provides for adequate funding, 
staff, and associated resources necessary to implement its 
requirements; and requires stationary source emissions monitoring and 
reporting, and otherwise satisfies the applicable requirements of 
section 110(a)(2).
    Part D SIP requirements: EPA has determined that the Indiana SIP 
meets applicable SIP requirements under part D of the CAA. Under part 
D, an area's classification (marginal, moderate, serious, severe, and 
extreme) indicates the requirements to which it will be subject. 
Subpart 1 of part D, found in sections 172-176 of the CAA, sets forth 
the basic nonattainment area plan requirements applicable to all 
nonattainment areas. Subpart 2 of part D, found in section 182 of the 
CAA, establishes additional specific requirements depending on the 
area's nonattainment classification.
    Part D, subpart 1 requirements: For purposes of evaluating this 
redesignation request, the applicable subpart 1 part D requirements for 
all nonattainment areas are contained in sections 172(c)(1)-(9) and 
176. A thorough discussion of the requirements of section 172 can be 
found in the General Preamble for Implementation of Title I (57 FR 
13498). (see also 68 FR 4852-4853 regarding a St. Louis ozone 
redesignation notice of proposed rulemaking for a discussion of section 
172 requirements.)
    No requirements under part D of the CAA came due for Clark and 
Floyd Counties prior to the State's November 15, 2006, submittal of a 
complete redesignation request. For example, the requirement for an 
ozone attainment demonstration, as contained in section 172(c)(1), was 
not yet applicable, nor were the requirements for Reasonably Available 
Control Measures (RACM) and Reasonably Available Control Technology 
(RACT) (section 172(c)(1)), Reasonable Further Progress (RFP) (section 
172(c)(2)), and attainment plan and RFP contingency measures (section 
172(c)(9)). All of these required SIP elements are required for 
submittal after November 15, 2006. Therefore, none of the part D 
requirements are applicable to Clark and Floyd Counties for purposes of 
redesignation.
    Section 176 conformity requirements: Section 176(c) of the CAA 
requires states to establish criteria and procedures to ensure that 
Federally-supported or funded activities, including highway projects, 
conform to the air planning goals in the applicable SIP. The 
requirement to determine conformity applies to transportation plans, 
programs, and projects developed, funded, or approved under Title 23 
U.S.C. and the Federal Transit Act (transportation conformity) as well 
as to all other Federally-supported or funded projects (general 
conformity). State conformity SIP revisions must be consistent with 
Federal conformity regulations that the CAA required the EPA to 
promulgate.
    In addition to the fact that part D requirements did not become due 
prior to Indiana's submission of the complete ozone redesignation 
request for Clark and Floyd Counties, and, therefore, are not 
applicable for redesignation purposes, EPA has similarly concluded that 
the conformity requirements do not apply for purposes of evaluating the 
ozone redesignation request under section 107(d) of the CAA. In 
addition, it is reasonable to interpret the conformity requirements as 
not applying for purposes of evaluating the ozone redesignation request 
under section 107(d) of the CAA because state conformity rules are 
still required after redesignation of an area to attainment of a NAAQS 
and Federal conformity rules apply where state rules have not been 
approved. See Wall v. EPA, 265 F.3d 426 (6th Cir. 2001). See also 60 FR 
62748 (December 7, 1995) (Tampa, Florida).
    We conclude that the State and Clark and Floyd Counties have 
satisfied all applicable requirements under section 110 and part D of 
the CAA to the extent that the requirements apply for the purposes of 
reviewing the State's ozone redesignation request.
2. Clark and Floyd Counties Have a Fully Approved Applicable SIP Under 
Section 110(k) of the CAA
    EPA has fully approved the Indiana SIP for Clark and Floyd Counties 
under section 110(k) of the CAA for all applicable requirements. EPA 
may rely on prior SIP approvals in approving a redesignation request 
(see the September 4, 1992 John Calcagni memorandum, page 3, 
Southwestern Pennsylvania Growth Alliance v. Browner, 144 F.3d 984, 
989-990 (6th Cir. 1998), Wall v. EPA, 265 F.3d 426

[[Page 26063]]

(6th Cir. 2001)), plus any additional measures it may approve in 
conjunction with a redesignation action. See 68 FR 25426 (May 12, 
2003). Since the passage of the CAA of 1970, Indiana has adopted and 
submitted, and EPA has fully approved, provisions addressing the 
various required SIP elements applicable to Clark and Floyd Counties 
for purposes of redesignation. No Clark and Floyd County SIP provisions 
are currently disapproved, conditionally approved, or partially 
approved. As indicated above, EPA believes that the section 110 
elements not connected with nonattainment plan submissions and not 
linked to the area's nonattainment status are not applicable 
requirements for purposes of review of the State's redesignation 
request. EPA has concluded that the section 110 SIP submission approved 
under the 1-hour standard will be adequate for purposes of attaining 
and maintaining the 8-hour standard. EPA also believes that since the 
part D requirements did not become due prior to Indiana's submission of 
a final, complete redesignation request, they also are not applicable 
requirements for purposes of redesignation.

C. The Air Quality Improvement in Clark and Floyd Counties Is Due to 
Permanent and Enforceable Reductions in Emissions From Implementation 
of the SIP and Applicable Federal Air Pollution Control Regulations and 
Other Permanent and Enforceable Emission Reductions

    EPA believes that the State of Indiana has demonstrated that 
implementation of the SIP, Federal measures, and other State-adopted 
measures have contributed to the observed air quality improvement in 
Clark and Floyd Counties.
    In making this demonstration, the State has documented the changes 
in VOC and NO<INF>X</INF> emissions from anthropogenic (man-made or 
man-based) sources in Clark and Floyd, as well as the entire Louisville 
nonattainment area, between 1996 and 2004 and the statewide 
NO<INF>X</INF> emissions from Electric Generating Units (EGUs) from 
1999 to 2005. The Louisville area was monitored in violation of the 8-
hour ozone NAAQS during the period of 2001-2003 and in attainment with 
the NAAQS during the period of 2003-2005. The total VOC and 
NO<INF>X</INF> emissions for both Clark and Floyd Counties and the 
entire Louisville nonattainment area (Louisville NA in the table) for 
2002, an attainment year, and 2003, a nonattainment year, are given in 
Table 2.

      Table 2.--VOC and NOX Emissions in Clark & Floyd Counties and
          Louisville, All Sources--Emissions in Tons/Summer Day
------------------------------------------------------------------------
                   Pollutant                        2002         2003
------------------------------------------------------------------------
VOC--Clark & Floyd............................        32.69        29.26
NOX--Clark & Floyd............................        57.59        51.76
VOC--Louisville NA............................       138.24       133.83
NOX--Louisville NA............................       247.46       238.76
------------------------------------------------------------------------

    The statewide NO<INF>X</INF> emissions for EGUs from 1999-2005 are 
given in Table 3 below.

 Table 3.--NOX Emissions From Electric Generating Units in Indiana Statewide--Emissions in Thousands of Tons per
                                                  Ozone Season
                                                 [April-October]
----------------------------------------------------------------------------------------------------------------
                   Area                       1999      2000      2001      2002      2003      2004      2005
----------------------------------------------------------------------------------------------------------------
Statewide.................................    149.8     133.9     136.1     114.0      99.3      66.6      55.5
----------------------------------------------------------------------------------------------------------------

    The NO<INF>X</INF> and VOC emissions for Clark and Floyd Counties 
and the entire Louisville nonattainment area have decreased from 2002, 
an 8-hour standard violation year, to 2003, an 8-hour standard 
attainment year. In addition, the Indiana Statewide EGU NO<INF>X</INF> 
emissions have continued to decline from 1999 to 2005. This is a result 
of the implementation of the Indiana NO<INF>X</INF> SIP (in response to 
EPA's NO<INF>X</INF> SIP call) and acid rain control regulations, both 
of which led to permanent, enforceable emission reductions.
    VOC and NO<INF>X</INF> emissions have declined as a result of 
enforceable emission reductions. As required by Section 172 of the CAA, 
Indiana in the mid-1990s promulgated rules requiring RACT for emissions 
of VOCs. Statewide RACT rules have applied to all new sources locating 
in Indiana since that time and include the following VOC rules: 326 
Indiana Administrative Code (IAC) 8-1-6 (Best Available Control 
Technology (BACT) for non-specific sources); 326 IAC 8-2 (surface 
coating emission limitations); 326 IAC 8-3 (organic solvent degreasing 
operations); 326 IAC 8-4 (petroleum sources); and 326 IAC 8-5 
(miscellaneous sources). The VOC emission reductions resulting from the 
implementation of these VOC emission control rules are permanent and 
enforceable.
    Besides the statewide VOC RACT rules and NO<INF>X</INF> emission 
control requirements, other Federal emission reduction requirements 
have resulted in decreased ozone precursor emissions in Clark and Floyd 
Counties (a similar set of control measures have been implemented for 
the Kentucky portion of the Louisville area) and will produce future 
emission reductions that will support maintenance of the ozone standard 
in these Counties. These emission reduction requirements include the 
following:
    Tier 2 Emission Standards for Vehicles and Gasoline Sulfur 
Standards. These emission control requirements result in lower 
emissions from new cars and light duty trucks, including sport utility 
vehicles. The Federal rules are being phased in between 2004 and 2009. 
The EPA has estimated that, by the end of the phase-in period, the 
following vehicle NO<INF>X</INF> emission reductions will

[[Page 26064]]

occur: Passenger cars (light duty vehicles) (77 percent); light duty 
trucks, minivans, and sports utility vehicles (86 percent; and larger 
sports utility vehicles, vans, and heavier trucks (69 to 95 percent). 
VOC emission reductions are also expected to range from 12 to 18 
percent, depending on vehicle class, over the same period. Although 
some of these emission reductions have already occurred by the 2004 
attainment year, most of these emission reductions will occur during 
the maintenance period for Clark and Floyd Counties.
    Heavy-Duty Diesel Engines. In July 2000, EPA issued a final rule to 
control the emissions from highway heavy duty diesel engines, including 
low-sulfur diesel fuel standards. These emission reductions are being 
phased in between 2004 and 2007. This rule is expected to result in a 
40 percent decrease in NO<INF>X</INF> emissions from heavy duty diesel 
vehicle.
    Non-Road Diesel Rule. Issued in May, 2004, this rule generally 
applies to new stationary diesel engines used in certain industries, 
including construction, agriculture, and mining. In addition to 
affecting engine design, this rule includes requirements for cleaner 
fuels. It is expected to reduce NO<INF>X</INF> emissions from these 
engines by up to 90 percent, and to significantly reduce particulate 
matter and sulfur emissions from these engines in addition to the 
NO<INF>X</INF> emission reduction. This rule did not affect 2004 
emissions from these sources, but will limit emissions from new engines 
beginning in 2008.
    Indiana commits to maintain all existing emission control measures 
that affect Clark and Floyd Counties after this area is redesignated to 
attainment of the 8-hour ozone NAAQS. All changes in existing rules 
affecting Clark and Floyd Counties and new rules subsequently needed to 
provide for the maintenance of the 8-hour ozone NAAQS in Clark and 
Floyd Counties will be submitted to the EPA for approval as SIP 
revisions.

D. Clark and Floyd Counties Have a Fully Approvable Ozone Maintenance 
Plan Pursuant to Section 175A of the CAA

    In conjunction with its request to redesignate Clark and Floyd 
Counties to attainment of the ozone NAAQS, Indiana submitted a SIP 
revision request to provide for maintenance of the 8-hour ozone NAAQS 
in Clark and Floyd Counties for at least 10 years after the 
redesignation of this area to attainment of the 8-hour ozone NAAQS.
1. What Is Required in an Ozone Maintenance Plan?
    Section 175A of the CAA sets forth the required elements of air 
quality maintenance plans for areas seeking redesignation from 
nonattainment to attainment of a NAAQS. Under section 175A, a 
maintenance plan must demonstrate continued attainment of the 
applicable NAAQS for at least 10 years after the Administrator approves 
the redesignation to attainment. Eight years after the redesignation, 
the State must submit a revised maintenance plan which demonstrates 
maintenance of the standard for 10 years following the initial 10 year 
maintenance period. To address the possibility of future NAAQS 
violations, the maintenance plan must contain such contingency 
measures, with a schedule for implementation, as EPA deems necessary, 
to assure prompt correction of any future NAAQS violations. The 
September 4, 1992, John Calcagni memorandum provides additional 
guidance on the content of maintenance plans. An ozone maintenance plan 
should, at minimum, address the following items: (1) The attainment of 
VOC and NO<INF>X</INF> emissions inventories; (2) a maintenance 
demonstration showing maintenance for the 10 years of the maintenance 
period; (3) a commitment to maintain the existing monitoring network; 
(4) factors and procedures to be used for verification of continued 
attainment; and (5) a contingency plan to prevent and/or correct a 
future violation of the NAAQS.
2. Demonstration of Maintenance
    IDEM prepared comprehensive VOC and NO<INF>X</INF> emission 
inventories for Clark and Floyd Counties, including point (significant 
stationary sources), area (smaller and widely-distributed stationary 
sources), mobile on-road, and mobile non-road sources for 2003 (the 
base year/attainment year).
    As part of the November 15, 2006, redesignation request submittal, 
IDEM included a requested revision to the SIP to incorporate a 14-year 
ozone maintenance plan which is consistent with the requirements under 
section 175A of the CAA. Included in the maintenance plan is a 
maintenance demonstration. This demonstration shows maintenance of the 
8-hour ozone NAAQS by documenting current and projected VOC and 
NO<INF>X</INF> emissions for both Clark and Floyd Counties and the 
entire Louisville nonattainment area and by documenting photochemical 
modeling results that support maintenance of the standard in this 
area.\5\
---------------------------------------------------------------------------

    \5\ The attainment year can be any of the three consecutive 
years in which the area has clean (below violation level) air 
quality data (2003, 2004, or 2005 for the Louisville area).
---------------------------------------------------------------------------

    Table 4 specifies the VOC emissions in Clark and Floyd Counties and 
the entire nonattainment area for 2003, 2011 and 2020. IDEM chose 2020 
as a projection year to meet the 10-year minimum maintenance projection 
requirement, allowing several years for the State to complete its 
adoption of the ozone redesignation request and ozone maintenance plan 
and for the EPA to approve the redesignation request and maintenance 
plan. IDEM also chose 2011 as an interim year to demonstrate that VOC 
and NO<INF>X</INF> emissions will remain below the attainment levels 
throughout the 14-year maintenance period. The mobile source emission 
projections for 2011 and 2020 exclude VOC reductions associated with 
Indiana's Clark and Floyd vehicle inspection and maintenance program 
that was discontinued at the end of 2006. Indiana's termination of its 
inspection and maintenance program in Clark and Floyd Counties will be 
the subject of a subsequent Federal Register notice.
    Table 5, similar to Table 4, specifies the NO<INF>X</INF> emissions 
in Clark and Floyd Counties and the entire nonattainment area for 2003, 
2011 and 2020. Together, the information contained in Tables 4 and 5 
and the photochemical modeling results demonstrate that Clark and Floyd 
Counties, and the Louisville nonattainment area, should remain in 
attainment of the 8-hour ozone NAAQS between 2003 and 2020, which is 
more than 10 years after EPA is expected to approve the redesignation 
of these counties to attainment of the 8-hour ozone NAAQS. The mobile 
source emission projections for 2011 and 2020 exclude NO<INF>X</INF> 
reductions associated with Indiana's Clark and Floyd vehicle inspection 
and maintenance program that was discontinued at the end of 2006.

[[Page 26065]]



  Table 4.--Attainment Year (2003) and Projected VOC Emissions in Clark
            and Floyd Counties and Entire Nonattainment Area
                          [Tons per summer day]
------------------------------------------------------------------------
                                                       Year
             Source sector              --------------------------------
                                            2003       2011       2020
------------------------------------------------------------------------
 Point:
    Clark and Floyd....................       4.17       6.61       7.14
    Louisville NA......................      36.62      39.28      39.85
 Area:
    Clark and Floyd....................      11.94      12.77      14.59
    Louisville NA......................      35.07      36.93      40.02
 On-Road Mobile:
    Clark and Floyd....................       9.60       6.12       3.98
    Louisville NA......................      40.97      25.69      16.89
 Off-Road Mobile:
    Clark and Floyd....................       3.55       2.35       2.20
    Louisville NA......................      21.17      15.87      15.28
 Total:
    Clark and Floyd....................      29.26      27.85      27.91
    Louisville NA......................     133.83     117.77     112.04
------------------------------------------------------------------------


Table 5.--Attainment Year and Projected NOX Emissions in Clark and Floyd
                 Counties and Entire Nonattainment Area
                          [Tons per summer day]
------------------------------------------------------------------------
                                                       Year
             Source sector              --------------------------------
                                            2003       2011       2020
------------------------------------------------------------------------
 Point:
    Clark and Floyd....................      24.26      27.29      28.66
    Louisville NA......................      99.73      78.95      75.97
 Area:
    Clark and Floyd....................       1.60       1.71       1.80
    Louisville NA......................       2.53       2.67       2.79
 On-Road Mobile:
    Clark and Floyd....................      20.27      10.20       4.15
    Louisville NA......................      95.51      47.53      19.62
 Off-Road Mobile:
    Clark and Floyd....................       5.63       4.43       3.49
    Louisville NA......................      41.01      34.77      27.88
 Total:
    Clark and Floyd....................      51.77      43.63      38.10
    Louisville NA......................     238.79     163.92     126.26
------------------------------------------------------------------------

    IDEM also notes that the State's EGU NO<INF>X</INF> emission 
control rules stemming from EPA's NO<INF>X</INF> SIP call, implemented 
beginning in 2004, and CAIR, which is to be implemented beginning in 
2009 will further lower NO<INF>X</INF> emissions in upwind areas. This 
should result in decreased ozone and ozone precursor transport into 
Clark and Floyd Counties. It will also support maintenance of the ozone 
standard in Clark and Floyd Counties.
    Based upon the data in Table 4, VOC emissions in Clark and Floyd 
Counties are projected to decline by about 5% between 2003 and 2020 and 
VOC emissions in the entire nonattainment area are projected to decline 
by 16%. Based upon the data in Table 5, NO<INF>X</INF> emissions in 
Clark and Floyd Counties are projected to decline by over 26% between 
2003 and 2020, and NO<INF>X</INF> emissions in the entire nonattainment 
area are projected to decline by 47%.
    Based on the projected VOC and NO<INF>X</INF> emission reductions 
between the attainment year in 2003 and the maintenance year of 2020, 
for both Clark and Floyd Counties and the entire Louisville 
nonattainment area, we conclude that IDEM has successfully demonstrated 
that the 8-hour ozone standard should be maintained in Clark and Floyd 
Counties, as well as the entire Louisville nonattainment area through 
2020. This is reinforced by photochemical modeling done for Clark and 
Floyd Counties. We believe that this is especially likely given the 
expected impacts of the NO<INF>X</INF> SIP call and CAIR. This 
conclusion is further supported by the fact that other states in the 
eastern portion of the United States are expected to further reduce 
regional NO<INF>X</INF> emissions through implementation of their own 
NO<INF>X</INF> emission control rules for EGUs and other NO<INF>X</INF> 
sources and through implementation of CAIR, reducing ozone and 
NO<INF>X</INF> transport into Clark and Floyd Counties and the entire 
Louisville nonattainment area.
3. Monitoring Network
    IDEM commits to continue operating and maintaining an approved 
ozone monitoring network in Clark and Floyd Counties in accordance with 
40 CFR part 58 through the 14-year maintenance period. This will allow 
the confirmation of the maintenance of the 8-hour ozone standard in 
this area and the triggering of contingency measures if needed.
4. Verification of Continued Attainment
    Continued attainment of the 8-hour ozone NAAQS in Clark and Floyd

[[Page 26066]]

Counties depends on the State's efforts toward tracking applicable 
indicators during the maintenance period. The State's plan for 
verifying continued attainment of the 8-hour ozone standard in Clark 
and Floyd Counties consists, in part, of a plan to continue ambient 
ozone monitoring in accordance with the requirements of 40 CFR part 58. 
In addition, IDEM will periodically revise and review the VOC and 
NO<INF>X</INF> emissions inventories for these counties to assure that 
emissions growth is not threatening the continued attainment of the 8-
hour ozone standard in this area. Revised emission inventories for this 
area will be prepared for 2005, 2008, and 2011 as necessary to comply 
with the emission inventory reporting requirements established in the 
CAA. The revised emissions will be compared with the 2003 attainment 
emissions and the 2020 projected maintenance year emissions to assure 
continued maintenance of the ozone standard.
5. Contingency Plan
    The contingency plan provisions of the CAA are designed to result 
in prompt correction or prevention of violations of the NAAQS that 
might occur after redesignation of an area to attainment of the NAAQS. 
Section 175A of the CAA requires that a maintenance plan include such 
contingency measures as EPA deems necessary to assure that the State 
will promptly correct a violation of the NAAQS that might occur after 
redesignation. The maintenance plan must identify the contingency 
measures to be considered for possible adoption, a schedule and 
procedure for adoption and implementation of the selected contingency 
measures, and a time limit for action by the State. The State should 
also identify specific indicators to be used to determine when the 
contingency measures need to be adopted and implemented. The 
maintenance plan must include a requirement that the State will 
implement all measures with respect to control of the pollutant(s) that 
were controlled in the SIP before the redesignation of the area to 
attainment. See section 175A(d) of the CAA.
    As required by section 175A of the CAA, Indiana commits to review 
its maintenance plan eight years after redesignation and to adopt and 
expeditiously implement any necessary corrective actions (or 
contingency measures). Contingency measures to be considered will be 
selected from a comprehensive list of measures deemed appropriate and 
effective at the time the selection is made. The contingency plan has 
two levels of actions/responses depending on whether a violation of the 
8-hour ozone standard is only threatened (Warning Level Response) or 
has actually occurred (Action Level Response).
    A Warning Level Response will be prompted whenever an annual (1-
year) fourth-high monitored daily peak 8-hour ozone concentration of 89 
ppb (or greater) occurs at any monitor in Clark and Floyd Counties, or 
a 2-year averaged annual fourth-high daily peak 8-hour ozone 
concentration of 85 ppb or greater occurs at any monitor in Clark or 
Floyd Counties. A Warning Level Response will consist of a study to 
determine whether the monitored ozone level indicates a trend toward 
higher ozone levels or whether emissions are increasing, threatening a 
future violation of the ozone NAAQS. The study will evaluate whether 
the trend, if any, is likely to continue, and, if so, the emission 
control measures necessary to reverse the trend, taking into 
consideration the ease and timing of implementation, as well as 
economic and social considerations. Implementation of necessary 
controls will take place as expeditiously as possible, but in no event 
later than 12 months from the conclusion of the most recent ozone 
season. If new emission controls are needed to reverse the adverse 
ozone trend, the procedures for emission control selection under the 
Action Level Response will be followed.
    An Action Level Response will be triggered when a violation of the 
8-hour ozone standard is monitored at any of the monitors in the 
maintenance area (when a 3-year average annual fourth-high monitored 
daily peak 8-hour ozone concentration of 85 ppb or higher is recorded 
at any such monitor). In this situation, IDEM will determine the 
additional emission control measures needed to assure future attainment 
of the 8-hour ozone NAAQS. IDEM will focus on emission control measures 
that can be implemented within 18 months from the close of the ozone 
season in which the ozone standard violation is monitored.
    Adoption of any additional emission control measures prompted by 
either of the two response levels will be subject to the necessary 
administrative and legal processes dictated by State law. This process 
will include publication of public notices, providing the opportunity 
for a public hearing, and other measures required by Indiana law for 
rulemaking by State environmental boards. If a new emission control 
measure is already promulgated and scheduled for implementation at the 
Federal or State level, and that emission control measure is determined 
to be sufficient to address the air quality problem or adverse trend, 
additional local emission control measures may be determined to be 
unnecessary. IDEM will submit to the EPA an analysis to demonstrate 
that the proposed emission control measures are adequate to return the 
area to attainment.
    Contingency measures contained in the maintenance plan are those 
emission controls or other measures that the State may choose to adopt 
and implement to correct existing or possible air quality problems in 
Clark and Floyd Counties. These include, but are not limited to, the 
following:
    i. Lower Reid vapor pressure gasoline requirements;
    ii. Broader geographic applicability of existing emission control 
measures;
    iii. Tightened RACT requirements on existing sources covered by EPA 
Control Technique Guidelines (CTGs) issued in response to the 1990 CAA 
amendments;
    iv. Application of RACT to smaller existing sources;
    v. Vehicle Inspection and Maintenance;
    vi. One or more Transportation Control Measures sufficient to 
achieve at least a 0.5 percent reduction in actual area-wide VOC 
emissions, to be selected from the following:
    A. Trip reduction programs, including, but not limited to, 
employer-based transportation management plans, area-wide rideshare 
programs, work schedule programs, and telecommuting;
    B. Transit improvement;
    C. Traffic flow improvements; and,
    D. Other new or innovative transportation measures not yet in 
widespread use that affect State and local governments as deemed 
appropriate;
    vii. Alternative fuel and diesel retrofit programs for fleet 
vehicle operations;
    viii. Controls on consumer products consistent with those adopted 
elsewhere in the United States;
    ix. VOC or NO<INF>X</INF> emission offsets for new or modified 
major sources;
    x. VOC or NO<INF>X</INF> emission offsets for new or modified minor 
sources;
    xi. Increased ratio of emission offsets required for new sources; 
and,
    xii. VOC or NO<INF>X</INF> emission controls on new minor sources 
(with VOC or NO<INF>X</INF> emissions less than 100 tons per year).
6. Provisions for a Future Update of the Ozone Maintenance Plan
    As required by section 175A(b) of the CAA, the State commits to 
submit to the EPA an update of the ozone maintenance plan eight years 
after redesignation of the County to attainment of the 8-hour ozone 
NAAQS. The revision will contain Indiana's plan

[[Page 26067]]

for maintaining the 8-hour ozone standard for 10 years beyond the first 
10-year period after redesignation.

V. Has Indiana Adopted Acceptable Motor Vehicle Emissions Budgets for 
the End of the 14-Year Maintenance Plan Which Can Be Used to Support 
Conformity Determinations?

A. How Are the Motor Vehicle Emission Budgets Developed and What Are 
the Motor Vehicle Emission Budgets for Clark and Floyd Counties?

    Under the CAA, States are required to submit, at various times, SIP 
revisions and ozone maintenance plans for applicable areas (for ozone 
nonattainment areas and for areas seeking redesignations to attainment 
of the ozone standard or revising existing ozone maintenance plans). 
These emission control SIP revisions (e.g., reasonable further progress 
and attainment demonstration SIP revisions), including ozone 
maintenance plans, must create MVEBs based on on-road mobile source 
emissions allocated to highway and transit vehicle use that, together 
with emissions from other sources in the area, will provide for 
attainment or maintenance of the ozone NAAQS.
    Under 40 CFR part 93, MVEBs for an area seeking a redesignation to 
attainment of the NAAQS are established for the last year of the 
maintenance plan and the State has the option of setting budgets for 
other years in the maintenance plan. The MVEBs serve as ceilings on 
emissions from an area's planned transportation system. The MVEB 
concept is further explained in the preamble to the November 24, 1993 
transportation conformity rule (58 FR 62188). The preamble also 
describes how to establish the MVEBs in the SIP and how to revise the 
MVEBs if needed.
    Under section 176(c) of the CAA, new transportation projects, such 
as the construction of new highways, must ``conform'' to (i.e., be 
consistent with) the part of the SIP that addresses emissions from cars 
and trucks. Conformity to the SIP means that transportation activities 
will not cause new air quality standard violations, or delay timely 
attainment of the NAAQS. If a transportation plan does not conform, 
most new transportation projects that would expand the capacity of 
roadways cannot go forward. Regulations at 40 CFR part 93 set forth 
EPA's policy, criteria, and procedures for demonstrating and assuring 
conformity of transportation activities to a SIP.
    When reviewing SIP revisions containing MVEBs, including attainment 
strategies, rate-of-progress plans, and maintenance plans, EPA must 
affirmatively find that the MVEBs are ``adequate'' for use in 
determining transportation conformity. Once EPA affirmatively finds the 
submitted MVEBs to be adequate for transportation conformity purposes, 
the MVEBs are used by state and Federal agencies in determining whether 
proposed transportation projects conform to the SIPs as required by 
section 176(c) of the CAA. EPA's substantive criteria for determining 
the adequacy of MVEBs are specified in 40 CFR 93.118(e)(4).
    EPA's process for determining the adequacy of MVEBs consists of 
three basic steps: (1) Providing public notification of a SIP 
submission; (2) providing the public the opportunity to comment on the 
MVEBs during a public comment period; and (3) making a finding of 
adequacy. The process of determining the adequacy of submitted SIP 
MVEBs was initially outlined in EPA's May 14, 1999, guidance, 
``Conformity Guidance on Implementation of March 2, 1999, Conformity 
Court Decision.'' This guidance was finalized in the Transportation 
Conformity Rule Amendments for the ``New 8-Hour Ozone and 
PM<INF>2.5</INF> National Ambient Air Quality Standards and 
Miscellaneous Revisions for Existing Areas: Transportation Conformity 
Rule Amendments--Response to Court Decision and Additional Rule 
Change'' published on July 1, 2004 (69 FR 40004). EPA follows this 
guidance and rulemaking in making its adequacy determinations.
    The Transportation Conformity Rule, in 40 CFR section 93.118(f), 
provides for MVEB adequacy findings through two mechanisms. First, 40 
CFR 93.118(f)(1) provides for posting a notice to the EPA conformity 
Web site at: http://www.epa.gov/otaq/stateresources/transconf/adequacy.htm and providing a 30-day public comment period. Second, a 
mechanism is described in 40 CFR 93.118(f)(2) which provides that EPA 
can review the adequacy of an implementation plan MVEB simultaneously 
with its review of the implementation plan itself.
    EPA, through this rulemaking, is proposing to approve the MVEBs for 
use to determine transportation conformity in the Louisville 8-hour 
ozone area because EPA has determined that the budgets are consistent 
with the control measures in the SIP and that Louisville can maintain 
attainment of the 8-hour ozone NAAQS for the relevant required 14-year 
period with mobile source emissions at the levels of the MVEBs.
    The MVEBs in the maintenance plan are for the entire Louisville 
area, which includes the Kentucky areas (Bullitt, Jefferson and Oldham 
Counties), in addition to Clark and Floyd Counties in Indiana. Through 
the transportation consultation process, it was decided that the best 
way to maintain the mobile source emissions for the area would be to 
set budgets for the entire area rather than each individual State. 
There is one Metropolitan Planning Organization for the entire area 
(the Kentuckiana Regional Planning and Development Agency). The 
transportation network modeling and transportation conformity 
determinations are conducted for the entire Louisville area. The 
transportation conformity regulations allow States to decide in 
consultation with the transportation partners, to determine budgets for 
the entire area or for each state. The transportation conformity 
budgets are listed in the Table below. MVEBs are proposed for both the 
2020 year or last year of the maintenance plan and also for the 2003 
year which is an attainment year.

 Louisville KY-IN 8-Hour Ozone Regional Motor Vehicle Emissions Budgets
                             (Tons per day)
------------------------------------------------------------------------
                                                          2003     2020
------------------------------------------------------------------------
VOC...................................................    40.97    22.92
NOX...................................................    95.51    29.46
------------------------------------------------------------------------

    Kentucky and Indiana have jointly chosen to allocate a portion of 
the available safety margin to the 2020 MVEBs. This allocation is 6.03 
tpd for VOC and 9.84 tpd for NO<INF>X</INF>. The 2020 regional MVEBs 
are derived as follows for VOC: [16.89 tpd for total mobile emissions] 
+ [6.03 tpd from available safety margin] = 22.92 tpd; and for 
NO<INF>X</INF>: [19.62 tpd for total mobile emissions] + [9.84 tpd from 
available safety margin] = 29.46 tpd. Thus, the remaining safety margin 
for the interstate Louisville area is 15.76 tpd for VOC and 102.69 tpd 
for NO<INF>X</INF>.
    These budgets are the same as the budgets that have been submitted 
by the State of Kentucky for the entire Louisville area and have been 
discussed by the transportation partners for the Louisville area.
    Through this rulemaking, EPA is proposing to approve the 2003 and 
2020 MVEBs for the interstate Louisville 8-hour ozone area for use to 
determine transportation conformity because EPA has determined that the 
interstate Louisville area maintains the standard with emissions at the 
levels of the budgets. If EPA approves the 2003 and

[[Page 26068]]

2020 MVEBs in the final rulemaking action, the new MVEBs must be used 
for future transportation conformity determinations. The new regional 
2003 and 2020 MVEBs, if found adequate or if approved in the final 
rulemaking, will be effective with the publication of EPA's adequacy 
finding or final rulemaking in the Federal Register, whichever is done 
first. For required regional emissions analysis years that involve the 
year 2020 or beyond, the applicable budgets for the purposes of 
conducting transportation conformity will be the 2020 MVEBs for the 
interstate Louisville area. For required analysis years prior to 2020, 
the applicable budgets will be the 2003 MVEBs.

B. Are the MVEBs Approvable?

    The VOC and NO<INF>X</INF> MVEBs for Louisville are approvable 
because they provide for continued maintenance of the 8-hour ozone 
standard through 2020 and provide a 6.03 tons-per-day safety margin for 
VOC and 9.84 tons-per-day safety margin for NO<INF>X</INF>.
    EPA is proposing to approve the 2003 and 2020 MVEBs for the 
interstate Louisville area because the maintenance plans demonstrate 
that expected emissions for the area, including the MVEBs plus the 
estimated emissions for all other source categories, will continue to 
maintain the 8-hour ozone standard.

VII. What is the Effect of EPA's Proposed Action?

    Approval of the redesignation request would change the official 
designation of Clark and Floyd Counties from nonattainment to 
attainment of the 8-hour ozone NAAQS. It would also incorporate into 
the Indiana SIP a plan for maintaining the ozone NAAQS through 2020. 
The maintenance plan includes contingency measures to remedy possible 
future violations of the 8-hour ozone NAAQS, and establishes MVEBs (for 
the entire Louisville area) for the years 2003 and 2020.

VII. Statutory and Executive Order Reviews

Executive Order 12866: Regulatory Planning and Review

    Under Executive Order 12866 (58 FR 51735, September 30, 1993), this 
action is not a ``significant regulatory action'' and, therefore, is 
not subject to review by the Office of Management and Budget.

Paperwork Reduction Act

    This proposed rule does not impose an information collection burden 
under the provisions of the Paperwork Reduction Act of 1995 (44 U.S.C. 
3501 et seq.).

Regulatory Flexibility Act

    This proposed action merely proposes to approve state law as 
meeting Federal requirements and imposes no additional requirements 
beyond those imposed by state law. Accordingly, the Administrator 
certifies that this proposed rule will not have a significant economic 
impact on a substantial number of small entities under the Regulatory 
Flexibility Act (5 U.S.C. 601 et seq.).

Unfunded Mandates Reform Act

    Because this rule proposes to approve pre-existing requirements 
under state law and does not impose any additional enforceable duty 
beyond that required by state law, it 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).

Executive Order 13132: Federalism

    This action also does not have Federalism implications because it 
does 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 (64 FR 43255, August 
10, 1999). This action 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.

Executive Order 13175: Consultation and Coordination with Indian Tribal 
Governments

    This proposed rule also does not have tribal implications because 
it will not have a substantial direct effect on one or more Indian 
tribes, 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, as specified by Executive 
Order 13175 (65 FR 67249, November 9, 2000).

Executive Order 13045: Protection of Children from Environmental Health 
and Safety Risks

    This proposed rule also is not subject to Executive Order 13045 
``Protection of Children from Environmental Health Risks and Safety 
Risks'' (62 FR 19885, April 23, 1997), because it proposes approval of 
a state rule implementing a Federal Standard.

Executive Order 13211: Actions That Significantly Affect Energy Supply, 
Distribution, or Use

    Because it is not a ``significant regulatory action'' under 
Executive Order 12866 or a ``significant regulatory action,'' this 
action is also not subject to Executive Order 13211, ``Actions 
Concerning Regulations That Significantly Affect Energy Supply, 
Distribution, or Use'' (66 FR 28355, May 22, 2001).

National Technology Transfer Advancement Act

    Section 12(d) of the National Technology Transfer and Advancement 
Act of 1995 (NTTAA), 15 U.S.C. 272, requires Federal agencies to use 
technical standards that are developed or adopted by voluntary 
consensus to carry out policy objectives, so long as such standards are 
not inconsistent with applicable law or otherwise impractical. In 
reviewing SIP submissions, EPA's role is to approve state choices, 
provided that they meet the criteria of the Clean Air Act. Absent a 
prior existing requirement for the state to use voluntary consensus 
standards, EPA has no authority to disapprove a SIP submission for 
failure to use such standards, and it would thus be inconsistent with 
applicable law for EPA to use voluntary consensus standards in place of 
a program submission that otherwise satisfies the provisions of the 
Clean Air Act. Therefore, the requirements of section 12(d) of the 
NTTAA do not apply.

List of Subjects

40 CFR Part 52

    Environmental protection, Air pollution control, Intergovernmental 
relations, Nitrogen dioxide, Ozone, Volatile organic compounds.

40 CFR Part 81

    Air pollution control, Environmental protection, National parks, 
Wilderness areas.

    Dated: April 30, 2007.
Bharat Mathur,
Acting Regional Administrator, Region 5.
 [FR Doc. E7-8772 Filed 5-7-07; 8:45 am]
BILLING CODE 6560-50-P


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