FEATHER RIVER AIR QUALITY MANAGEMENT DISTRICT MEMORANDUM 08/01/2011

TO: FRAQMD BOARD OF DIRECTORS

FROM: David A Valler, Jr, APCO

SUBJECT: Adoption of Resolution # 2011

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, District Rule 10.10 Prevention of

Significant Deterioration

BACKGROUND
Prevention of Significant Deterioration (PSD) is a federal permitting program for new major stationary facilities and significant modifications to existing major facilities located in areas classified

as attainment or in areas that are unclassifiable for a ny criteria air pollutant. As a District, we are more familiar with the Title V Federal Operating Permit Program that is for major sources of pollutants regardless of attainment status. Title V permits ultimately incorporate PSD permit conditions. The PSD permitting program is a pre

- construction permit that is administered by the Environmental Protection Agency Region IX (EPA) for Yuba and Sutter counties. There are currently only two PSD permit for Sutter County, both held by Calpine Corporation.

With the recent addition of Greenhouse Gases (GHG) as a regulated pollutant under the Federal Clean Air Act, which makes these pollutants subject to federal permitting, EPA Region IX could possibly have a significant increase in PSD permit applications throughout t he state. EPA staff could be overwhelmed with these new permit applications and the delay in processing them could be two years or more. Consequently, EPA is encouraging local air districts to take on PSD permitting responsibility for projects that occur w ithin their jurisdiction. For an air district to take on PSD permitting, the district needs to adopt a PSD permitting rule that mirrors the federal requirements and have that rule ARB and EPA approved for incorporation into the State Implementation Plan (S IP).
The most straightforward way for an air district to take on PSD responsibility is to adopt a rule that incorporates the federal requirements by reference (IBR). CAPCOA has developed a model rule in conjunction with EPA and ARB staff, and the CAPCOA En gineering Manager’s Committee.

Feather River Air Quality Management District staff is proposing that the Board adopt this CAPCOA model rule.

PUBLIC PROCESS
Public outreach consisted of one public workshop publicized through a newspaper notice, posting of t he notice on the District website, and mailing a notice to sources which currently have a Title V permit. As mentioned in the Staff Report, no public comments were received.PROPOSAL

Staff has determined a necessity to adopt Regulation X, Rule 10.10 in ord er to prevent any delays in processing of PSD permits for new major stationary sources or major modifications to existing major stationary sources.

FISCAL IMPACT
Adoption of Rule 10.10 will have an additional fiscal impact on businesses that are proceeding with a new major source or a significant modification of an existing major source of an attainment pollutant. The District does not propose imposing a new fee structure to cover the costs of the permit, but to incorporate the PSD permit and review into th e existing process for Authorities to Construct and Permits to Operate. Currently, EPA does not charge any fees for processing a PSD permit because EPA is funded with taxpayer dollars.

RECOMMENDATION

The District recommends the Board a pprove the attached r esolution to adopt the proposed new Rule 10. 1 0 Prevention of Significant Deterioration and to direct the APCO to submit the rule for inclusion in the SIP.

ATTACHMENTS
A. Staff Report

– Rule 10. 1 0 Prevention of Significant Deterioration

B . Rule 10.1 0 Resolution
, Resolution N o. 2011

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Staff Report

– Rule 10.1 0ATTACHMENT B

Rule 10. 10 Proposed, Resolution No. 2011

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