[Federal Register Volume 62, Number 224 (Thursday, November 20, 1997)]
[Proposed Rules]
[Pages 61948-61953]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-30521]


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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[Region 2 Docket No. NJ29-1-175; FRL-5925-5]


Approval and Promulgation of Implementation Plans; State of New 
Jersey; Clean Fuel Fleet Opt Out

AGENCY: Environmental Protection Agency (EPA).

ACTION: Proposed rule.

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SUMMARY: In this action, the Environmental Protection Agency (EPA) is 
proposing to approve the State Implementation Plan revision submitted 
by the State of New Jersey for the purpose of meeting the requirement 
to submit the Clean Fuel Fleet program (CFFP) or a substitute program 
that meets the requirements of the Clean Air Act (Act). EPA is 
proposing to approve the State's plan for implementing a substitute 
program to opt out of the CFFP.

DATES: Comments must be received on or before December 22, 1997.

ADDRESSES: All comments should be addressed to Ronald Borsellino, 
Chief, Air Programs Branch, Environmental Protection Agency, Region 2 
Office, 290 Broadway, New York, New York 10007-1866.
    Copies of the State submittals are available at the following 
addresses for inspection during normal business hours:

Environmental Protection Agency, Region 2 Office, Air Programs Branch, 
290 Broadway, 25th Floor, New York, New York 10007-1866
New Jersey Department of Environmental Protection, Bureau of Air 
Quality Planning, 401 East State Street, CN027, Trenton, New Jersey 
08625

FOR FURTHER INFORMATION CONTACT: Michael P. Moltzen, Air Programs 
Branch, Environmental Protection Agency, 290 Broadway, 25th Floor, New 
York, New York 10007-1866, (212) 637-4249.

SUPPLEMENTARY INFORMATION:

I. Background

    Section 182(c)(4)(A) of the Clean Air Act requires states 
containing areas designated as severe ozone nonattainment areas, 
including New Jersey, to submit for EPA approval a state implementation 
plan (SIP) revision that includes measures to implement the Clean Fuel 
Fleet program (CFFP). Under this program, a certain specified 
percentage of vehicles purchased by fleet operators for covered fleets 
must meet emission standards that are more stringent than those that 
apply to conventional vehicles. Covered fleets are defined as fleets of 
10 or more vehicles that are centrally fueled or capable of being 
centrally fueled. A CFFP meeting federal requirements would be a state-
enforced program which requires covered fleets to assure that an 
annually increasing percentage of new vehicle purchases are certified 
clean vehicles and that those vehicles operate on clean fuel. In New 
Jersey, the program would apply in the State's portion of the New York-
Northern New Jersey-Long Island ozone nonattainment area and in New 
Jersey's portion of the Philadelphia-Wilmington-Trenton ozone 
nonattainment area.
    The federal CFFP is divided into two components. The first 
component is a light duty (LD) CFFP which applies to covered fleets of 
passenger cars and trucks of gross vehicle weight rating (GVWR) of 
6,000 pounds and less, and trucks between 6,000 and 8,500 pounds GVWR. 
Covered fleets which fall under the LD CFFP are required to assure that 
30 percent of new purchases are clean vehicles in the first year of the 
program, 50 percent in the second year and 70 percent in the third and 
subsequent years.
    The second component is a heavy duty (HD) CFFP which applies to 
covered fleets of trucks over 8,500 pounds GVWR and below 26,000

[[Page 61949]]

pounds GVWR. The HD CFFP requires that 50 percent of covered fleets' 
new purchases be clean fueled vehicles in the first and subsequent 
years.
    Under the federal CFFP, the vehicle exhaust emission standards for 
LD vehicles are equivalent to those established by the California Air 
Resources Board (CARB) as LD low emission vehicles (LEVs), for use in 
the California LEV program (discussed in more detail in section II. of 
this notice). In addition to LEVs, CARB certification exists for 
transitional LEVs (TLEVs), ultra LEVs (ULEVs) and zero emission 
vehicles (ZEVs). In addition, under the federal CFFP, clean vehicle 
emission standards are defined for inherently low emitting vehicles 
(ILEVs) and for medium and heavy duty vehicles (both of which are 
covered within the HD CFFP weight category). For further information 
regarding emission standards associated with all of the clean fuel 
vehicles which are applicable under the LEV program and the federal 
CFFP, the reader is referred to the CFFP final rule, published on March 
1, 1993 at 58 FR 11888.
    Section 182(c)(4)(B) of the Act allows states to ``opt out'' of the 
CFFP by submitting for EPA approval a SIP revision consisting of a 
program or programs that will result in at least equivalent long term 
reductions in ozone-producing and toxic air emissions as achieved by 
the CFFP. The Clean Air Act directs EPA to approve a substitute program 
if it achieves long term reductions in emissions of ozone-producing and 
toxic air pollutants equivalent to those that would have been achieved 
by the CFFP or the portion of the CFFP for which the measure is to be 
substituted.
    New Jersey, in its 1992 SIP revision chose to preserve its right to 
opt out of the CFFP but did not indicate a specific substitute measure 
or measures which was to be used for that purpose. Prior to EPA action 
on this commitment, the Court of Appeals for the District of Columbia 
ruled that EPA's conditional approval policy with respect to state 
commitments was contrary to law. [NRDC v. EPA, 22 F.3d. 1125 (D.C. Cir. 
1994)]. The court held that a bare commitment from a state was not 
sufficient to warrant conditional approval from EPA under section 
110(k)(4) of the Act. Therefore, following this decision, EPA could not 
approve New Jersey's November 1992 commitment to opt out of the CFFP.
    However, in fashioning a remedy for EPA's improper use of its 
conditional approval authority, the NRDC Appellate court did not want 
to penalize states for their reliance on EPA's actions.
EPA also does not believe that New Jersey should lose its opportunity 
to opt out of the CFFP with a substitute program that meets the 
requirements of section 182(c)(4)(B) because of EPA's inability to act 
on New Jersey's commitment, especially since New Jersey has since 
submitted such a substitute program for EPA approval.
    Therefore, EPA is considering all relevant submissions made thus 
far by the State that are intended to substitute for the CFFP.
    The Region received from New Jersey a proposed SIP revision dated 
May 15, 1994. The submittal, consisting of New Jersey's then proposed 
LEV program, was intended to fulfill the State's CFFP obligations. 
However, because the Clean Air Act requires SIP revisions to consist of 
adopted measures, and because the opt out measure was only in the 
proposal stage, EPA transmitted a finding of failure to submit the 
required SIP revision in a letter to the State on October 3, 1994. New 
Jersey then had 18 months from the date of the letter to submit the 
required SIP before sanctions were to take effect.
    On February 15, 1996, in order to cure the finding of failure to 
submit, New Jersey submitted its New Jersey Clean Fleets (NJCF) program 
as a substitute for the federal CFFP. As described earlier, the federal 
CFFP is a state-enforced program which requires that operators of 
covered vehicle fleets assure that a percentage of their new vehicle 
purchases are certified clean vehicles and that those vehicles operate 
on clean fuel. By contrast, the NJCF program is an essentially 
voluntary mix of incentive-based programs which are intended to spur 
public and private fleets within New Jersey to purchase clean, 
alternatively fueled vehicles (AFVs) (discussed in more detail in 
section III. C. of this notice).
    On March 29, 1996, New Jersey supplemented the CFFP SIP revision 
with a letter clarifying that the NJCF program substitution includes, 
to the extent necessary to meet SIP obligations, New Jersey's LEV 
program which had been adopted by that time. Because the emissions 
reductions relied upon in the NJCF program will largely result from 
voluntary measures, the State's LEV program essentially serves the role 
of a ``backstop'' to the NJCF program. This means that in the event the 
NJCF program fails to achieve the emissions reductions claimed by the 
State, emission reductions achieved with the separate LEV program will 
be used by the State to account for those reductions that would have 
originally been realized through the federal CFFP. In that event EPA 
would then recognize the State's LEV program as the effective opt out 
measure.
    Unlike the federal CFFP, the LEV program imposes requirements on 
auto manufacturers and their yearly vehicle sales. New Jersey adopted a 
LEV regulation states that New Jersey's primary intention is to 
participate in the National LEV (NLEV) program (discussed in more 
detail in the section II. C.4. of this notice). However, EPA cannot 
require NLEV--it must be mutually agreed upon by the participating 
states and the auto manufacturers--and if NLEV fails to become 
effective (due to lack of such an agreement), New Jersey's regulation 
states that it will operate a State LEV or ``California'' LEV program 
(discussed in more detail in section II. of this notice), an option 
afforded states in the Clean Air Act (see Clean Air Act section 177). 
The NLEV and State LEV programs are similar in that where applicable, 
auto manufacturers must meet an average vehicle emission standard, 
based on the certified emission standards of all annual vehicle sales. 
The annual average vehicle emission standard (referred to as the non-
methane organic gas (NMOG) average) increases in stringency on an 
annual basis. Quantitatively, NLEV or State LEV, whichever is 
ultimately implemented in New Jersey, will achieve long term vehicle 
emission reductions which are far greater than what the federal CFFP 
could have achieved.
    Based on these provisions in the SIP revisions submitted by New 
Jersey on February 15, 1996 and March 29, 1996, EPA sent a letter to 
New Jersey on April 4, 1996 notifying the State that the finding of 
failure to submit had been withdrawn. New Jersey amended its NJCF SIP 
revision with a March 6, 1997 submittal, which included comments on the 
proposed SIP revision received by the State, including those received 
at a State-held public hearing on October 21, 1996.
    The Clean Air Act requires states to observe certain procedural 
requirements in developing implementation plan revisions for submission 
to EPA. Sections 110(a)(2) and 172(c)(7) of the Act require states to 
provide reasonable notice and public hearing before adoption by the 
state and submission to EPA for approval. Section 110(1) of the Act 
also requires states to provide reasonable notice and hold a public 
hearing before adopting SIP revisions.
    EPA must also determine whether a state's submittal is complete 
before taking further action on the submittal. See section 110(k)(1). 
EPA's completeness criteria for SIP submittals are set out in 40 CFR 
Part 51, Appendix

[[Page 61950]]

V (1993). New Jersey's SIP revision which EPA is proposing to approve 
in this notice meets all of the procedural requirements and 
completeness criteria.

II. State Submittal

    New Jersey submitted SIP revisions on February 15, 1996, March 29, 
1996 and March 6, 1997 which substituted the State's NJCF program, 
backstopped by New Jersey's adopted and enforceable LEV program, for 
the federal CFFP. The adopted LEV regulation requires the 
implementation of a program identical to the California LEV program or, 
if certain triggering events occur, participation in the National LEV 
program (discussed in more detail in section III. C.4. of this 
section). The LEV program operated in California requires that each 
model year of vehicles produced for sale, beginning with model year 
1994, be certified to meet a specific NMOG standard when their total 
emissions are averaged as a fleet. Manufacturers must ensure that each 
model year of vehicles produced for sale, meet a yearly NMOG fleet 
average. The California LEV fleet-average NMOG standard was 0.25 grams 
per mile for model year 1994. The NMOG average becomes increasingly 
more stringent annually, and for model year 2003 and later the standard 
is 0.063 grams per mile.
    New Jersey held a public hearing on October 21, 1996 to entertain 
public comment on its federal CFFP substitute SIP revision; this 
hearing included the State's proposal to opt out of the CFFP with its 
NJCF program and LEV backstop as a substitute program.

III. Analysis of State Submission

A. Opt Out Criteria and Requirements

    Section 182(c)(4) of the Clean Air Act, which allows states 
required to implement a CFFP to opt out of the program by submitting a 
SIP revision consisting of a substitute program, requires that the 
substitute program result in long term emission reductions equal to or 
greater than does the CFFP. Also, EPA can only approve such substitute 
programs that consist exclusively of provisions other than those 
required under the Clean Air Act for the area. New Jersey's backstopped 
NJCF program satisfies both of these requirements.

B. Equivalency of Substitute

    The Clean Air Act requires that any substitute for the federal CFFP 
must provide equivalent long term emission reductions. In its SIP 
revision, the State estimated the emission reductions which would be 
attributable to operation of the federal CFFP in New Jersey. It is this 
amount of long term reduction, discussed below, which the State's 
substitute must achieve.
Light Duty Vehicle Analysis
    New Jersey first analyzed the potential for emissions reductions to 
result from long term compliance with the LD vehicle portion of the 
federal CFFP in New Jersey. The LD vehicle purchase requirements of the 
federal CFFP are intended to ensure a gradual turnover of conventional 
LD fleet vehicles to clean LD vehicles in covered fleets. In the long 
term, a substantial portion of LD vehicles in covered fleets, where the 
program is operated, would meet the LEV (or cleaner) standard, where 
otherwise they would not have met those more stringent standards (i.e., 
if the State was not also operating a LEV program as described above). 
In its SIP revision however, New Jersey pointed out that the LD vehicle 
portion of the federal CFFP, in the long term, would essentially 
duplicate the Statewide, more comprehensive New Jersey LEV program 
which has already been adopted [Adopted on November 22, 1995 at 27 
N.J.R. 5016(a) (December 18, 1995), codified at N.J.A.C. 7:27-26].
    In the SIP revision, New Jersey explained that its LEV program is 
more comprehensive than the LD portion of the federal CFFP, because it 
will require virtually all LD vehicles sold in New Jersey (including 
fleet and non-fleet vehicles) to meet, by model year 2000, the LEV 
standard when their total emissions are averaged. By contrast, the 
federal LD CFFP will only require 70 percent of new vehicle purchases 
in covered fleets to meet the LEV standard in the long term, a 
requirement which would be met through the State's LEV requirements, 
imposed on the vehicle manufacturers.
    New Jersey also noted that its LEV program begins one year later 
(model year 1999) than the federal CFFP (model year 1998). The State 
offered the justification that in the long term however, the LEV 
program requirements would make up for any shortfall in LD vehicle 
emission reductions that might be caused by the difference in start 
dates. However, subsequent to the date that New Jersey made its opt out 
submission to EPA, EPA has determined that a one year delay of 
implementation of the CFFP is necessary and appropriate. The delay is 
needed due to a stated lack of availability of the requisite types and 
numbers of clean fueled vehicles in the majority of the areas which are 
required to implement and comply with the regulatory requirements of a 
CFFP. This guidance and policy decision, which was based on input from 
all of the program stakeholders, was transmitted in a May 22, 1997 memo 
from EPA Office of Mobile Sources Director Margo Oge to EPA's Regional 
Air Directors. EPA anticipates publishing a rulemaking in the Federal 
Register shortly, finalizing the delay. The fact of the delay further 
lends equivalency to the NJCF program as a CFFP opt out, since both 
programs will now start at the same time.
    With further examination of the relative effects of these programs, 
New Jersey also noted that there will still exist certain aspects of 
the federal LD CFFP that could result in greater emission reductions 
than the NJCF program on an individual LD vehicle basis. As an example, 
the State discussed the requirement that LEVs operate on the fuels for 
which they were certified to operate on, and that the federal CFFP 
requires that covered fleets must ensure that a certain percentage of 
their new vehicle purchases (both light and heavy duty) are certified 
to meet LEV (or cleaner) standards. By contrast, the NJCF program is 
voluntary (with the exception of the Energy Policy Act (EPAct), 
discussed in further detail in section C.). The State again justified 
the equivalency claim of its opt out measure by explaining the reasons 
why these differences are not significant discrepancies. With respect 
to the loss of emission reduction benefits that would occur from 
gasoline-powered LEVs operating on federal reformulated gasoline (RFG) 
rather than the fuel that they were certified to operate on (e.g., 
California RFG), New Jersey explained that such a loss would be 
relatively small in the long term. The State claims that this is true 
because the reductions from the federal CFFP would occur only on a per 
vehicle basis, and because of its anticipation that a substantial 
number of LEVs will be operating on alternative fuels, in the later 
years of the State LEV program, that are cleaner than California RFG. 
EPA agrees with this line of reasoning, as well as with New Jersey's 
assertion that the overall additional benefit of the federal CFFP's 
fuel requirement for LEVs would be relatively small and insignificant 
in the long term for those reasons.
    EPA agrees with New Jersey that implementation of the federal LD 
CFFP, in addition to either the NLEV or the State LEV program (the 
State has made certain through its regulations that one or the other 
will be implemented), for any small incremental benefits in light of 
the additional administrative requirements of the federal CFFP, would 
be burdensome and impractical. Lastly, EPA has determined, for the 
reasons

[[Page 61951]]

stated above, that the State does not need to account explicitly for 
the long term emission reductions which would have been associated with 
a LD CFFP since those reductions are negated by operation of a LEV 
program.
Heavy Duty Vehicle Analysis
    The heavy duty vehicle portion of the federal CFFP requires that on 
an annual basis, 50 percent of heavy duty fleet vehicles purchased each 
year must meet clean fuel vehicle emission standards. Through 
appropriate modeling, New Jersey has determined that the estimated 
emission reduction benefit that would result from applying the federal 
CFFP's heavy duty vehicle requirements in New Jersey would be 
approximately 4.5 tons per day (tpd) of VOC and NO<INF>X</INF> combined 
in 2010 (modeling techniques and assumptions used to arrive at this 
figure are described below). New Jersey assumes in its SIP, and EPA 
agrees with the assumption, that modeling emission reductions out to 
the year 2010 is adequate for the purpose of determining the long term 
reductions which could be expected of the heavy duty CFFP in New 
Jersey. The NJCF program must achieve that amount of emission 
reductions within the same time frame in order to be an acceptable 
substitute for the federal CFFP. If it does not, as will be verified 
through the program emission reduction tracking system that the State 
committed to implement (described in more detail below), the State has 
also committed to use emission reduction credit generated from either 
the NLEV program or the State LEV program to make up any emission 
reduction shortfall which may result.
Modeled Reductions from the CFFP
    In order to determine the level of long term emissions reductions 
which needs to be provided by its opt out measures, the State employed 
the latest version of the mobile source emission model approved by EPA, 
MOBILE5a. Emission factors generated by the MOBILE model were used in 
conjunction with proscribed CFFP calculation guidelines in EPA's June 
1994 CFFP Regulatory Impact Analysis (RIA). New Jersey determined 
through this modeling that the long term reductions associated with the 
federal CFFP would equal 4.5 tons per day of NO<INF>X</INF> and VOC 
combined.

C. NJCF Program Details and Goals

    NJDEP has estimated that, in order to meet the Clean Air Act 
requirement of an approvable CFFP substitute, the NJCF program must 
provide emission reductions equivalent to those from approximately 
50,750 medium heavy duty certified clean fueled vehicles by 2010. NJDEP 
estimates that about 176 of these vehicles will come from the Clean 
Cities program, and the remainder from the efforts of the Incentive 
Development Workgroup (both of which are described below).
    NJDEP has determined that in order to contribute towards the 
emission reductions needed for a substitute program, a medium or heavy 
duty vehicle must be certified by CARB to meet LEV (or cleaner) 
standards. For this reason New Jersey's SIP revision does not rely on 
emission reductions from alternative fuel vehicle (AFV) conversions to 
meet the target of 4.5 tons per day of NO<INF>X</INF> and VOC combined 
by 2010. Furthermore, AFV conversions will comprise a relatively small 
percentage of total clean AFVs in use in New Jersey in the long term. 
EPA agrees with this conservative approach in today's proposed 
approval.
    The NJCF program consists of the following four components: (1) 
Incentive Development program, (2) the Department of Energy's (DOE's) 
EPAct fleet requirements, (3) DOE's Clean Cities program, and 4) the 
Advanced Technology Vehicle (ATV) component of EPA's finalized NLEV 
program.
1. Incentive Development Program
    The incentive development program was developed by a public/private 
workgroup which includes representatives of local and national fleet 
operators, municipalities, alternative and clean fuel providers, and 
government officials. The Workgroup's efforts are intended to spur use 
of clean alternative fuel vehicles. Major areas of focus for the 
Workgroup, as it implements its Action Plan, include development of a 
New Jersey alternative fuel mechanic training program and promotion of 
a State policy supporting the use of alternative fuels and AFVs.
2. EPAct Purchase Mandates
    The second component of the NJCF program is the alternative fuel 
vehicle purchase requirements under the federal EPAct, 42 U.S.C. 
Sec. 13201 et seq. Under EPAct, all state, federal, and fuel-provider 
fleets must ensure that a percentage of their new LD vehicle purchases 
operate on alternative fuels. In the long term, 75% of new state and 
federal purchases and 90% of fuel-provider purchases must be AFVs. To 
date, New Jersey reports that 61 State vehicles have been converted to 
run on clean alternative fuels as a result of EPAct compliance, and 
alternative fuel vehicles are available for purchase by public agencies 
through the State purchase contract.
3. New Jersey Clean Cities Program
    Clean Cities is a voluntary federal program designed to accelerate 
and expand the use of clean AFVs and related refueling infrastructure 
in communities throughout the country. In 1995 the State's Division of 
Energy initiated Clean Cities programs in the metropolitan areas of 
Elizabeth, Jersey City, Newark and Trenton; New Jersey plans to expand 
these programs in other areas of the State as well. New Jersey expects 
the program to have a significant long term emission reduction benefit.
4. Advanced Technology Vehicle Program
    The fourth component of the NJCF program is the Advanced Technology 
Vehicle (ATV) component of the NLEV program. NLEV is an alternative to 
the Ozone Transport Commission (OTC) LEV program, which the OTC 
petitioned EPA to require. EPA had made a determination requiring LEV 
to be adopted throughout the northeast ozone transport region (OTR); 
however a Federal Circuit Court has since remanded that requirement. 
Virginia v. EPA, No. 95-1163 (D.C. Cir. March 11, 1997). NLEV is a 
voluntary program wherein auto manufacturers would manufacture low 
emission vehicles nationwide instead of just for the OTR and 
California.
    EPA proposed the NLEV program in October 1995, and issued the final 
NLEV rule in the June 6, 1997 Federal Register (62 FR 31192). EPA also 
issued an NLEV supplementary Notice of Proposed Rulemaking (SNPRM) on 
August 22, 1997. EPA intends to finalize the SNPRM by mid- to late-
autumn, 1997. Auto manufacturer and OTC state opt-ins shortly 
thereafter will ensure program startup in time for model year 1999 LEVs 
in the OTR.
    In EPA's June 6, 1997 NLEV final rulemaking, an ATV was defined as 
any vehicle certified by CARB or EPA that is either: (1) A dual-fuel, 
flexible-fuel, or dedicated alternatively fueled vehicle certified as a 
transitional low emission vehicle (TLEV), LEV, or ultra low emission 
vehicle (ULEV) when operated on the alternative fuel; (2) certified as 
a ULEV or Inherently Low Emission Vehicle (ILEV); or (3) a dedicated or 
hybrid electric vehicle. As discussed in that rulemaking, EPA 
acknowledges the suggestion that advancing motor vehicle pollution 
control technology is an important benefit of NLEV. Furthermore, it has 
been suggested by several parties, including New Jersey, that 
establishment of an ATV component should be a criterion for

[[Page 61952]]

determining whether NLEV is an acceptable LEV-equivalent program. 
Although EPA agrees that advancing technology is an important goal, and 
EPA believes that the NLEV program could be a part of an agreement that 
would provide important opportunities to promote ATVs, the regulatory 
portion of the NLEV program does not address ATVs, EPA does not believe 
that advancing technology is or should be a legally-required criterion 
for approval of a LEV-equivalent program, and given the court decision 
invalidating the OTC LEV SIP call, there is no longer any legal 
requirement for NLEV to be a LEV-equivalent program. Nevertheless, EPA 
recognizes that including some advanced technology component is 
important and could provide additional environmental benefits beyond 
emissions reduction equivalency. Furthermore, EPA agrees with New 
Jersey's intention to use the ATV component as part of its substitute 
(backstopped by the enforceable State LEV program) for the federal 
CFFP. The ATV program involves a cooperative effort among the states in 
the OTR, EPA, DOE, fuel providers, aftermarket converters, fleet 
operators, and the full range of motor vehicle manufacturers to develop 
ways to increase use of ATVs. The NJDEP expects to begin implementing 
the ATV program, in cooperation with other states, the auto 
manufacturers, and fuel providers, as soon as the NLEV program with an 
ATV component becomes effective.
    In order to facilitate implementation of the NJCF program, New 
Jersey has stated in its latest SIP revision that it is relying on EPA 
to support the ATV initiative by approving emission reduction SIP 
credits, where appropriate, upon the introduction of ATVs into the 
fleet. EPA is prepared to assist the State in this manner (i.e. by 
allowing long term emission reductions generated by the ATV component 
of NLEV to be used in part as a substitute SIP measure for the CFFP), 
provided emissions reductions from the ATV provision, along with those 
generated from the other NJCF program components, can be documented by 
the State. It is for this purpose that New Jersey has incorporated a 
planned system to track NJCF program emissions reductions. This system, 
described below, will serve to identify the need, if any should exist 
in the future, to utilize the credit from the State's adopted LEV 
program (i.e., the backstop) should the planned reductions not occur as 
intended with the voluntary NJCF program.
NJCF Program Backstop
    New Jersey, in exercising its option under section 177 of the Clean 
Air Act, has adopted a LEV program which affects all new LD vehicles 
sold State-wide, specifically passenger cars and LD trucks under 6,000 
lbs. gross vehicle weight rating (GVWR) for vehicle model years 1999 
and later. The LEV program sets forth five different sets of emission 
standards, and vehicle manufacturers may market any combination of 
vehicles provided that the annual average emissions of each 
manufacturer's fleet complies with a fleet average limit that becomes 
more stringent each year.
    New Jersey's LEV program will assure reductions of ozone-forming 
and air toxics emissions that are at least equivalent to those that 
would be realized through the LD portion of a CFFP; in the event that 
the NJCF failed to reduce long term emissions to the level which would 
have been achieved by the CFFP, LEV could make up the resultant 
shortfall.
Vehicle Tracking System
    As part of its most recent NJCF SIP revision, New Jersey has 
committed to implement an automated tracking system to track clean 
fueled vehicle purchases and conversions associated with the NJCF 
program (detailed above) throughout the State beginning in 1998. The 
State will periodically track the variety of clean NJCF vehicles 
purchased in New Jersey, but most notably CARB certified LEVs (and 
vehicles certified to more stringent standards, such as ULEVs). The 
information gathered from the automated tracking system would provide 
an accurate indication of the number of vehicles purchased in New 
Jersey that are certified to meet the applicable LEV, etc. standards. 
In this manner the State can accumulate a database with which it can 
calculate emission reduction benefits associated with certified clean 
vehicle purchases resulting from the NJCF program, and determine if 
necessary the need to employ the LEV backstop discussed above.

IV. Summary of Action

    In this proposed rule, EPA is proposing to approve New Jersey's SIP 
revision submitted to fulfill the Clean Fuel Fleet requirements of the 
Clean Air Act. EPA believes New Jersey's Clean Fleet program, 
backstopped by the adopted New Jersey LEV program implementing the low 
emission vehicle program are an adequate substitute for the federal 
Clean Fuel Fleet program under section 182(c)(4).
    Nothing in this rule should be construed as permitting or allowing 
or establishing a precedent for any future request for revision to any 
SIP. Each request for revision to any SIP shall be considered 
separately in light of specific technical, economic, and environmental 
factors and in relation to relevant statutory and regulatory 
requirements.

Administrative Requirements

Executive Order 12866

    The Office of Management and Budget has exempted this action from 
review under Executive Order 12866.

Unfunded Mandates

    Under section 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 
annual costs to State, local, or tribal governments in the aggregate; 
or to private sector, of $100 million or more. Under section 205, EPA 
must select the most cost-effective 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 approval action proposed does not 
include a federal mandate that may result in estimated annual costs of 
$100 million or more to either State, local, or tribal governments in 
the aggregate, or to the private sector. This federal action approves 
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.

Regulatory Flexibility Act

    Under the Regulatory Flexibility Act, 5 U.S.C. 600 et. seq., EPA 
must prepare a regulatory flexibility analysis assessing the impact of 
any proposed or final rule on small entities (5 U.S.C. 603 and 604). 
Alternatively, EPA may certify that the rule will not have a 
significant impact on a substantial number of small entities. Small 
entities include small businesses, small not-for-profit enterprises, 
and government entities with jurisdiction over populations of less than 
50,000.
    SIP approvals under section 110 and subchapter I, part D of the 
Clean Air Act do not create any new requirements, but

[[Page 61953]]

simply approve requirements that the State is already imposing. 
Therefore, because the federal SIP-approval does not impose any new 
requirements, I certify that it does not have a significant impact on 
any small entities affected. Moreover, due to the nature of the 
federal-state relationship under the Clean Air Act, preparation of a 
regulatory 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 US EPA, 427 US 246, 256-66 (S.Ct. 1976); 42 U.S.C. 7410(a)(2).

List of Subjects in 40 CFR Part 52

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

    Authority: 42 U.S.C. 7401-7671q.

    Dated: November 6, 1997.

William J. Muszynski,
Acting Regional Administrator.
[FR Doc. 97-30521 Filed 11-19-97; 8:45 am]
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