[Federal Register Volume 62, Number 232 (Wednesday, December 3, 1997)]
[Rules and Regulations]
[Pages 63853-63858]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-31736]


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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 80

[FRL-5931-3]


Petition by the Commonwealth of the Northern Mariana Islands for 
Exemption From Anti-Dumping and Detergent Additization Requirements for 
Conventional Gasoline

AGENCY: Environmental Protection Agency.

ACTION: Notice of direct final decision.

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SUMMARY: The Environmental Protection Agency (``EPA'' or ``the 
Agency'') is granting a petition by the Commonwealth of the Northern 
Mariana Islands (``CNMI'') for exemption from the anti-dumping 
requirements for gasoline sold in the United States after January 1, 
1995. This action is being taken because of CNMI's unique geographic 
location and economic factors. If the gasoline anti-dumping exemption 
were not granted, CNMI would be required to import gasoline from a 
supplier meeting the anti-dumping requirements adding a considerable 
expense to gasoline purchased by the CNMI consumer. CNMI is in full 
attainment with the national ambient air quality standard for ozone. 
This action is not expected to cause harmful environmental effects to 
the citizens of CNMI. EPA is not granting CNMI's petition for exemption 
from the fuel detergent additization requirements that all gasoline 
sold in the U.S. after January 1, 1995 contain fuel detergents. CNMI 
did not show that these requirements were unreasonable or infeasible 
due to any unique local factors. The fuel detergent additization 
requirements are designed to prevent the build-up of deposits in 
gasoline engines and fuel supply systems. By controlling such desposits 
in CNMI's vehicles, harmful engine exhaust emissions will be reduced.
    This action is being taken as a direct final decision because EPA 
believes that this decision is noncontroversial. The effects of this 
decision are limited to the Commonwealth of the Northern Mariana 
Islands.

DATES: This action will be effective on February 2, 1998, unless the 
Agency receives adverse or critical comments by January 2, 1998. If the 
Agency receives adverse comments, EPA will publish in the Federal 
Register timely notice withdrawing this action. In a separate action 
published in the Federal Register today, EPA is concurrently proposing 
approval of CNMI's petition for reasons discussed in this document. All 
correspondence should be directed to the addresses shown below.

ADDRESSES: Any persons wishing to submit comments should submit them 
(in duplicate, if possible) to the two dockets listed below, with a 
copy forwarded to Marilyn Winstead McCall, U. S. Environmental 
Protection Agency, Fuels and Energy Division, 401 M Street, S.W. (Mail 
Code: 6406J), Washington, DC 20460.
    Materials relevant to this petition are available for inspection in 
public docket A-96-11 at the Air Docket Office of the EPA, room M-1500, 
401 M Street, SW., Washington, DC 20460, (202) 260-7548, between the 
hours of 8:00 a.m. to 5:30 p.m. Monday through Friday. A duplicate 
public docket, A-NM-96 has been established at U.S. EPA Region IX, 75 
Hawthorne Street, (Mail Code: A-2-1), 17th Floor, San Francisco, CA 
94105, (415) 744-1225, and is available between the hours of 8:30 a.m. 
to noon, and 1 p.m. to 5 p.m., Monday through Friday. As provided in 40 
CFR part 2, a reasonable fee may be charged for copying services.

FOR FURTHER INFORMATION CONTACT: Marilyn Winstead McCall at (202) 564-
9029.

SUPPLEMENTARY INFORMATION:

I. Background

A. Regulated Entities

    Entities potentially affected by this action are those involved 
with the production, distribution, and sale of conventional gasoline 
and gasoline detergent additives for gasoline used in CNMI. Regulated 
categories and entities include:

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                Category                  Examples of regulated entities
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Industry...............................  Gasoline refiners and          
                                          importers, gasoline terminals,
                                          detergent blenders, gasoline  
                                          truckers, gasoline retailers  
                                          and wholesale purchaser-      
                                          consumers.                    
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This table is not intended to be exhaustive, but rather provides a 
guide for readers regarding entities likely to be affected by this 
action. This table lists the types of entities that EPA is now aware 
could potentially be affected by this decision. Other types of entities 
not listed could also be affected. To determine whether your 
organization is affected by this decision, you should carefully examine 
the applicability requirements in Sec. 80.90, Sec. 80.125, and 
Sec. 80.161, Subparts E, F, and G of title 40 of the Code of Federal 
Regulations (CFR). If you have any questions regarding the 
applicability of this action to a particular entity, consult the person

[[Page 63854]]

listed in the preceding FOR FURTHER INFORMATION CONTACT section.

B. Summary of CNMI's Petition

    On July 12, 1995, the Honorable Froilan C. Tenorio, Governor of the 
Commonwealth of the Northern Mariana Islands, petitioned the Agency for 
an exemption from the requirements of regulations promulgated at 40 CFR 
80 that require conventional gasoline meet certain anti-dumping 
specifications and detergent additization requirements. On December 15, 
1993, EPA promulgated regulations on the production and sale of 
reformulated gasoline and gasoline that is not required to be 
reformulated, or ``conventional'' gasoline. For conventional gasoline, 
the gasoline produced by a refiner or importer is required to cause no 
more motor vehicle emissions than gasoline produced by that refiner or 
importer in 1990. This is commonly called the ``anti-dumping'' program. 
On October 14, 1994, and July 15, 1996, EPA promulgated regulations 
requiring that all gasoline contain fuel detergents. The fuel detergent 
additization regulations require that all gasoline sold or dispensed in 
the United States contain additives to prevent accumulation of deposits 
in vehicle engines and fuel supply systems, and that volumetric 
additive reconciliation records (``VAR'') and product transfer 
documents (``PTD'') be maintained by certain persons who add the 
required detergent to the gasoline and transfer the product to other 
persons. Since CNMI is in attainment for ozone, it is not required to 
offer reformulated gasoline. However, providers of gasoline in CNMI 
such as those listed in the table above are required to provide 
conventional gasoline that meets the anti-dumping provisions and the 
detergent additization requirements beginning January 1, 1995.

C. Statutory Provisions

    Section 211(k) of the Clean Air Act requires that gasoline be 
reformulated to reduce motor vehicle emissions of toxic and 
tropospheric ozone-forming compounds, and that this reformulated 
gasoline be sold in the nine largest metropolitan areas with the most 
severe summertime ozone levels and other ozone nonattainment areas that 
opt into the program. Section 211(k)(8) prohibits conventional gasoline 
sold in the rest of the country from becoming any more polluting than 
it was in 1990. This requirement ensures that refiners do not ``dump'' 
fuel components into conventional gasoline that cause environmentally 
harmful emissions and that are restricted in reformulated gasoline. 
This requirement is referred to as the ``anti-dumping'' standards for 
conventional gasoline.<SUP>1</SUP>
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    \1\ 40 CFR part 80, subparts E and F.
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    Section 211(l) states that ``no person may sell or dispense to an 
ultimate consumer in the United States, and no refiner or marketer may 
directly or indirectly sell or dispense to persons who sell or dispense 
to ultimate consumers in the United States any gasoline which does not 
contain additives to prevent the accumulation of deposits in engines or 
fuel supply systems.'' This requirement is commonly referred to as the 
``fuel additization'' or ``detergent additization'' regulation. The 
CNMI is defined as a state in these regulations.<SUP>2</SUP>
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    \2\ 40 CFR part 80, subparts A and G.
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    Section 325 of the Act provides that, upon petition by the Governor 
of Guam, American Samoa, the Virgin Islands, or the Commonwealth of the 
Northern Mariana Islands, the Administrator may exempt any person or 
source in such territory from various requirements of the Act. It 
states that ``such exemption may be granted if the Administrator finds 
that compliance with such requirements is not feasible or is 
unreasonable due to unique geographical, meteorological, or economic 
factors of such territory, or such other local factors as the 
Administrator deems significant.''
    EPA previously granted CNMI an exemption from the sulfur content 
requirements for motor vehicle diesel fuels as specified in sections 
211 (i) and (g) of the Act on May 19, 1994. That exemption was 
effective on July 18, 1994. A more in-depth description of CNMI's 
geographical, meteorological and economic characteristics are discussed 
in the notice of direct final decision granting that petition (see 59 
FR 26129, May 19, 1994).

D. CNMI's Geographical, Meteorological, and Demographic Characteristics

    CNMI consists of fourteen islands of volcanic origin located in the 
western part of the Pacific Ocean. The islands are part of the Mariana 
Archipelago (the southernmost island of which is Guam, a separate 
territory of the United States) and extend generally in a north-south 
orientation for 388 nautical miles, with a total dry land area of 176.5 
square miles. The largest and most populated of the islands is Saipan 
(population approximately 40,000). Most of the remainder of the 
population is split between the islands of Tinian and Rota, each having 
a population of slightly more than 2,000 persons. CMNI is 5,280 miles 
from the mainland United States, 1,440 miles east of Manila, 1,150 
miles south of Tokyo, and 108 miles north of Guam.
    CNMI has a tropical climate, with consistently warm and humid 
weather. Prevailing winds blow from the east 55% of the time and from 
the northeast 25% of the time. The trade winds are strongest and most 
constant during the dry season when wind speeds average 15 to 25 miles 
per hour. In addition, during the rainy season, the islands are 
periodically hit by westward moving typhoons and heavy storm systems 
with wind speeds exceeding 100 miles per hour.
    CNMI is in attainment with all primary and secondary ambient air 
quality standards (NAAQS), including the standard for ozone. The 
developed and populated areas of Saipan are located predominantly on 
the western side of the island. CNMI's petition states that, as a 
result, the winds from the east regularly disperse most air pollutants 
emitted from sources on the island over the Philippine Sea.

E. Economic Factors in CNMI

    All motor vehicle gasoline is imported to CNMI and supplied by 
refineries in Singapore and Australia. Transportation costs dictate 
that the markets supplying gasoline to CNMI be limited to the Far East. 
It is estimated that there are 20,000 to 30,000 gasoline-powered 
vehicles in CNMI. Most are relatively new as the harsh, corrosive 
environment of CNMI tends to shorten a car's operational life. Average 
vehicle usage is estimated to be less than 1,000 miles per 
month.<SUP>3</SUP>
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    \3\ Letter dated August 7, 1996, from Eric Murdock, Hunton & 
Williams, Washington, D.C., supporting CNMI's petition.
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    CNMI is significantly less affluent than the mainland United 
States. The annual per capita income in CNMI is less than $7,200 
<SUP>4</SUP> compared to a national average of $14,420 <SUP>5</SUP>. 
Moreover, due to relatively high transportation costs, retail gasoline 
prices are already significantly higher in CNMI than in the continental 
U.S., ranging, in July 1995, from an average of about $1.60 per gallon 
on the island of Saipan to more than $1.80 per gallon on the islands of 
Rota and Tinian. For the same period, the national weekly average for a 
gallon of gasoline was approximately $1.18.<SUP>6</SUP>
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    \4\ Final Rule, ``Commonwealth of the Northern Mariana Islands; 
Petition for Exemption from the Diesel Fuel Sulfur Requirements,'' 
59 FR 26129, (May 19, 1994).
    \5\ Guam Department of Commerce.
    \6\ ``U. S. Sees Higher Gasoline Demand and Prices,'' The New 
York Times, April 11, 1996.

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[[Page 63855]]

II. Clarification and Rationale for Exemption

A. Anti-Dumping Requirements (Subparts E and F)

Clarification
    Section 211(k)(8) requires that average per gallon emissions of 
VOC, CO, NO<INF>X</INF>, and toxics due to conventional gasoline 
produced by a refiner or importer not increase over 1990 levels for 
each refiner or importer. Since VOC and CO emission increases are 
expected to be controlled through other regulatory programs, the anti-
dumping provisions are limited to regulating emissions of toxics and 
NO<INF>X</INF> emissions.
    Pursuant to Section 211(k)(8) of the Act, EPA adopted the 
regulations in Subpart E to address exhaust benzene, total exhaust 
toxics and NO<INF>X</INF> emissions from conventional gasoline use. 
Under a simple emissions model, applicable from January 1, 1995 to 
January 1, 1998, a limit is set for sulfur, olefins and T90 as well as 
exhaust benzene. A more complex emissions model is required beginning 
January 1, 1998, with limits set on exhaust toxics and NO<INF>X</INF>. 
All the limits are set as annual averages.
    Compliance is measured by comparing emissions of a refiner's or 
importer's conventional gasoline against those of a baseline gasoline--
either a baseline based on the quality of a refiner's 1990 gasoline or 
on a statutory baseline specified by the Clean Air Act. Subparts E and 
F require a refiner or importer that establishes a baseline to hire an 
independent auditor to verify its baseline parameters. EPA requires 
each refiner or importer to maintain records and to report to EPA 
certain information pertaining to production of conventional gasoline 
by February 1996, and every subsequent year. CNMI's petition states 
that importers would be required to demonstrate compliance with the 
anti-dumping requirements using the statutory baseline.
Rationale for Exemption From Anti-dumping Requirements
    The burden of compliance with these requirements in CNMI will fall 
principally on the two major gasoline importing and marketing companies 
who import gasoline to CNMI. These companies also import the gasoline 
that is supplied in Guam. Therefore the gasoline supplied in CNMI is 
expected to have the same properties in terms of the anti-dumping 
parameters as the gasoline sold in Guam.<SUP>7</SUP>
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    \7\ Letters dated August 7, 1996 and October 8, 1996, from Eric 
Murdock, Hunton & Williams, Washington, D.C., supporting CNMI's 
petition.
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    Transportation costs dictate that the markets supplied by these 
refineries be limited to the Far East. These refineries have no reason 
to produce reformulated gasoline or conventional gasoline that meets 
the anti-dumping requirements. One importer states that the demand for 
gasoline in CNMI represents less than 1% of the total gasoline 
production of the Singapore refineries.
    As in Guam, Singapore refineries currently supply CNMI's gasoline. 
Therefore, the quality is the same in CNMI as in Guam. Singapore 
refineries differ from the configurations of typical mainland U.S. 
refineries in that they do not have catalytic cracking capability (that 
is, the Singapore refineries do not employ fluid catalytic cracking or 
``FCC'' units). As a result of these differences in plant 
configuration, the properties of the gasoline produced by the Singapore 
refineries would be expected to be quite different in some respects 
from the properties of gasoline produced by the typical mainland U. S. 
refinery (i.e., ``baseline'' conventional gasoline). Specifically, 
gasoline produced at the Singapore refineries would typically have 
lower concentrations of sulfur and olefins and relatively higher 
concentrations of benzene and aromatics.
    As a result of these differences, the gasoline produced at the 
Singapore refineries cannot consistently satisfy the anti-dumping 
requirements when compared to statutory baseline gasoline, particularly 
for the winter season. This is not the result of any ``dumping'' of 
components restricted in reformulated gasoline; it is a reflection of 
differences in the quality of the gasoline produced in Singapore 
compared to that typically produced in the mainland U.S.
    The two importers of gasoline to CNMI have indicated that the 
gasoline normally imported from the Singapore refineries is likely to 
contain benzene and aromatic concentrations that exceed the statutory 
baseline levels. Approximately 12,000,000 gallons of gasoline are 
consumed annually in CNMI.<SUP>8</SUP> As previously stated, the 
quality of the gasoline imported to CNMI is the same as that imported 
to Guam. If CNMI is not granted an exemption from the anti-dumping 
requirements, EPA calculates that gasoline, meeting the statutory 
baseline, could result during a compliance period in emitting 
approximately 4 tons of total toxic emissions in CNMI.
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    \8\ Letter dated October 8, 1996, from Eric Murdock, Hunton & 
Williams, Washington, D.C., supporting CNMI's petition.
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    A simple cost effectiveness analysis indicates that the cost 
effectiveness of reducing the total toxic emissions would be over 
$200,000 per ton.<SUP>9</SUP> In EPA's Regulatory Impact Analysis for 
Reformulated Gasoline,<SUP>10</SUP> the Agency estimated that reducing 
total toxic emissions from combustion and use of gasoline under the 
reformulated gasoline program would cost approximately $55,000 per ton. 
Therefore, the cost effectiveness of using another gasoline supplier to 
reduce air toxics emissions in CNMI is several times higher than EPA's 
estimate for nationwide control of toxics in the federal reformulated 
gasoline program.
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    \9\ Computed from values in Guam petition based on proportional 
relationship (see 61 FR 53854 10/16/96).
    \10\ See Regulatory Impact Analysis for Reformulated Gasoline, 
EPA Air Dockets A-92-01 and A-92-12, 401 M Street, S.W., Washington, 
D.C. 20460.
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    CNMI's petition states that overall compliance with the anti-
dumping and fuel detergent requirements would require capital 
expenditures of $143,000 and annual operating costs of $212,500. These 
costs are entirely associated with gasoline and will therefore result 
in increases in the retail price of gasoline, estimated by the 
companies to be at least 1 to 2 cents per gallon.
    In addition, the anti-dumping requirements could force importers to 
obtain gasoline from distant refineries, adding substantially to the 
transportation costs and resulting in a price increase at the retail 
level of as much as another 10 cents per gallon. The CNMI consumer is 
already paying a significantly higher price for gasoline than the 
consumer on the U. S. mainland. An additional 10 cents or more per 
gallon for gasoline would pose a significant economic burden to CNMI 
residents.

B. Fuel Additization Requirements--(Subpart G)

Clarification
    Section 211(l) requires that, beginning January 1, 1995, no person 
may sell or dispense to an ultimate consumer in the United States, and 
no refiner or marketer may sell or dispense to persons who sell or 
dispense to ultimate consumers in the United States any gasoline which 
does not contain additives to prevent the accumulation of deposits in 
engines or fuel supply systems. EPA promulgated a rule on October 14, 
1994, under which all gasoline (reformulated and conventional) sold or 
transferred to gasoline retail outlets or wholesale purchaser consumer 
facilities and all gasoline sold or transferred to ultimate consumers 
must be additized with a fuel

[[Page 63856]]

detergent additive registered with the EPA, starting January 1, 1995. 
On July 5, 1996, EPA published a supplemental rule requiring testing 
and certification of the fuel detergents (61 FR 3510).
    Fuel deposits in motor vehicle engines and fuel supply systems and 
their impacts on vehicle performance have been studied for many years. 
Fuel injector and intake valve deposits have been shown to have 
significant adverse effects on drivability, exhaust emissions and, in 
some cases, on fuel economy. Deposits in fuel injectors may undercut 
the effectiveness of engines' oxygen sensors in ensuring the best fuel/
air ratio to control emissions. Carburetor deposits can cause improper 
enrichment of the fuel/air mixture, which can result in rough idling, 
stalling, poor acceleration, reduced fuel economy and higher emissions 
of hydrocarbons, carbon monoxide, and, in some cases, nitrogen oxides. 
The mechanisms by which intake valve deposits increase emissions are 
less clear. Adsorption and desorption of fuel on the intake valves can 
lead to improper fuel/air ratios across the cylinders, thereby 
interfering with the ability of the oxygen sensor to regulate proper 
mixture composition. Intake valve deposits might also increase 
emissions by interfering with the proper preparation and delivery of 
the fuel air mixture resulting in combustion inefficiency.
    Under the current additization program, the detergent additive must 
be registered under 40 CFR Part 79, and must be added in concentration 
equal to or exceeding the level specified by the additive manufacturer 
as being effective in preventing deposits. Each facility where 
detergent additization is performed is required to create and maintain 
volumetric additive reconciliation (VAR) records to demonstrate that 
the gasoline has been additized to the proper concentration. Product 
transfer documentation (PTD) is required whenever title or custody to 
any gasoline or detergent is transferred, other than when additized 
gasoline is sold or dispensed at a retail outlet or wholesale 
purchaser-consumer facility to the consumer. Each gasoline refiner, 
importer, carrier, distributor, oxygenate blender or detergent blender 
who owns, leases, operates, controls or supervises the facility 
(including a truck or individual storage tank) is subject to these 
requirements.
Rationale for Denying Exemption
    CNMI's petition states that of the two importers of gasoline, only 
one importer adds a detergent additive to all of the grades of gasoline 
that it sells in CNMI. The importer using detergents in all the 
gasoline it imports to CNMI adds a detergent additive (RT2276) to both 
grades it imports at a concentration of 19.1 gallons to every 42,000 
gallons of gasoline. As mentioned in the notice of direct final 
decision on Guam's petition for exemption from the anti-dumping and 
gasoline detergent additization regulations, all importers and 
marketers of Guam's gasoline are now adding detergents to Guam's 
gasoline.<SUP>11</SUP> EPA, believes, therefore, that it is also 
feasible for the importer and its marketers not using detergents to add 
detergents to the gasoline it imports for consumption in CNMI.
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    \11\ 61 Fed. Reg. 53854 (October 16, 1996).
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    Capital costs of compliance with the anti-dumping and additization 
requirements would be approximately $143,000, of which amount, the 
majority would be required for the additization requirements. 
Approximately $5,000 of this amount would be required for software 
modifications for the VAR and PTD requirements (for the importer that 
is not already adding detergents to its gasoline). Annual operating 
expenditures would amount to more than $212,000--approximately one-half 
of that amount would be required for operating expenses for the 
additization requirements for the two importers. These costs are 
comparable to the costs computed for the three importers of gasoline to 
Guam as described in the notice of direct final decision on Guam's 
petition for exemption from the anti-dumping and detergent additization 
requirements of conventional gasoline.<SUP>12</SUP>
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    \12\ 61 FR 53854 (October 16, 1996).
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    EPA believes that the costs in CNMI of compliance with the 
requirements of Subpart G would be the same as compared to compliance 
costs in Guam. The Guam petition stated that the compliance cost would 
add between .6 to 1.4 cents to the cost of a gallon of gasoline. EPA 
estimated that the average incremental cost to consumers of compliance 
with the detergent requirements for the mainland United States would be 
0.1 cent a gallon <SUP>13</SUP> with this cost being partially 
compensated for by the increased fuel economy and decreased maintenance 
requirements which improved deposit control is expected to provide. 
Over 90 percent of the total estimated cost of the program is 
associated with the price of the additional additive amounts needed to 
bring all gasoline up to the effective detergency levels which most of 
U.S. gasoline already contains. EPA believes that the cost to CNMI 
consumers will, most likely, closely parallel that projected for 
consumers in the mainland U.S.
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    \13\ Final Rule on the Certification Standards for Deposit 
Control of Gasoline Additives, July 5, 1996, 61 FR 35353.
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    Transportation costs associated with shipping detergent additive 
which complies with federal detergency requirements to CNMI are likely 
to be somewhat higher than in the mainland U.S. However, EPA believes 
that this differential in cost will have minimal effect due to the 
small volume of detergent additive estimated to be needed to achieve 
proper additization (approximately 0.4 to 0.6 gallons of detergent to 
1,000 gallons of gasoline). In addition, EPA's estimate of the cost to 
the consumer of the detergent program assumed the average motorist 
drives 10,000 to 15,000 miles per year and consumes 400 to 600 gallons 
of gasoline. Given CNMI's small size, the average motorist would tend 
to drive less than the average motorist on the mainland which would 
tend to reduce the cost to a CNMI consumer relative to EPA's estimate. 
CNMI's petition states that average miles driven per year are less than 
12,000. All things considered, the cost to the consumer of up to six 
dollars a year estimated for the U.S. as a whole, holds for CNMI as 
well. EPA believes that this would not be an unreasonable economic 
burden for the CNMI consumer. This is generally consistent with EPA's 
estimate of the cost of compliance with the detergent requirements for 
the mainland United States. In addition, one supplier is already adding 
detergents to all of the gasoline it imports to CNMI. Therefore only 
one importer's gasoline is not currently being additized.
    Compliance costs associated with the record keeping (VAR and PTD) 
requirements of the detergent rule are the primary additional costs to 
be considered herewith. As in the Guam petition <SUP>14</SUP> EPA 
estimates that compliance with the record keeping requirements of 
Subpart G would add only a small portion--less than l cent--to the cost 
of a gallon of gasoline. EPA believes that this would not be an 
unreasonable economic burden for the CNMI consumer.
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    \14\ 61 FR 53854 (October 16, 1996).
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    Start-up costs could be higher in CNMI than in other markets on the 
mainland where detergent additization has been an ongoing process for 
several years. EPA does not believe that start-up of this program will 
be significantly more difficult or expensive in CNMI compared to the 
rest of the U.S. Further, once compliance programs are established, the 
annual cost of compliance will be comparable to that in other areas. In 
summary, the small

[[Page 63857]]

added cost to CNMI consumers, the fact that one of the two importers is 
now adding detergents to its gasoline, and the fact that the CNMI 
gasoline suppliers also supply Guam's gasoline of the same quality (see 
61 FR 53854 (October 16, 1996)) which contains detergents lead EPA to 
conclude that an exemption from the requirements of Subpart G is not 
warranted.

III. Final Action

A. Anti-Dumping Provisions for Conventional Gasoline

    EPA has decided to exempt the Commonwealth of the Northern Mariana 
Islands from compliance with the anti-dumping standards for 
conventional gasoline under section 211(k)(8). The Agency believes that 
compliance with the gasoline anti-dumping requirements is unreasonable 
given the significantly increased costs to consumers in CNMI in 
achieving compliance. These increased costs are directly attributable 
to CNMI's location and resulting inability of importers to comply with 
the anti-dumping requirements without significantly greater costs than 
those expected for importers in the U.S. mainland. Gasoline price 
increases of the magnitude expected to result from compliance with 
subparts E and F could be especially burdensome for the many citizens 
of CNMI whose incomes are modest.
    In addition, despite its geographic remoteness from the mainland, 
compliance with the anti-dumping provisions might require that CNMI 
import conventional gasoline from the U.S. mainland, greatly increasing 
the cost of conventional gasoline. EPA finds that these economic 
factors are unique to the Commonwealth of the Northern Mariana Islands.
    This exemption will apply to all persons in CNMI subject to the 
anti-dumping requirements in section 211(k)(8) of the Act, and subparts 
E and F of 40 CFR Part 80. This exemption is retroactive to January 1, 
1995, and applies only to gasoline imported to CNMI for use in CNMI. 
EPA reserves the right to review and reopen this exemption in the 
future if conditions change to warrant such an action.

B. Fuel Detergent Additization

    EPA is denying the petition from the Commonwealth of the Northern 
Mariana Islands for an exemption from the fuel detergent additization 
requirement that, after January 1, 1995, all conventional gasoline 
contain registered fuel additives that control fuel deposits as 
established in 40 CFR part 80, subpart G. CNMI has not demonstrated 
that unique local factors exist such that compliance with the detergent 
additization and record keeping requirements would be either infeasible 
or unreasonable.

IV. Public Participation and Effective Date

    The Agency is publishing this action as a direct final decision 
because it views it as noncontroversial and limited to the Commonwealth 
of the Northern Mariana Islands. EPA anticipates no adverse or critical 
comments. Representatives of automobile and petroleum industry 
associations have indicated that their constituents will not be 
adversely affected by this direct final decision and therefore the 
Agency expects no adverse comments from the members of those 
associations. Similarly, the Agency does not expect adverse comments 
from the environmental community or state and local governments, since 
the environmental impact is very minimal.
    This action will become effective February 2, 1998. If the Agency 
receives adverse or critical comments by January 2, 1998, EPA will 
publish a subsequent Federal Register document withdrawing this 
decision. In the event that adverse or critical comments are received, 
EPA is also publishing a notice of proposed decision in a separate 
action today, which proposes the same action contained in this direct 
final decision. Any adverse comments received by the date listed above 
will be addressed in a subsequent final decision. That final decision 
will be based on the relevant portion of the proposed final decision 
that is published today in the proposed rules section of this Federal 
Register and that is identical to this direct final decision. The EPA 
will not institute a second comment period on this action. Any parties 
interested in commenting on this action should do so at this time. If 
no such comments are received, the public is advised that this action 
will be effective February 2, 1998.
    This procedure allows the opportunity for public comments and 
opportunity for oral presentation of data as required under section 
307(d) of the Act. This procedure also provides an expedited procedure 
for final action where a decision is not expected to be controversial 
and no adverse comment is expected.

V. Executive Order 12866

    Under Executive Order 12866,<SUP>15</SUP> the Agency must determine 
whether a regulation is ``significant'' and therefore subject to OMB 
review and the requirements of the Executive Order. The Order defines 
``significant regulatory action'' as one that is likely to result in a 
rule that may:
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    \15\ 58 FR 51736 (October 4, 1993).
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    (1) Have an annual effect on the economy of $100 million or more, 
or adversely affect in a material way the economy, a sector of the 
economy, productivity, competition, jobs, the environment, public 
health or safety, or State, local or tribal governments of communities;
    (2) Create a serious inconsistency or otherwise interfere with an 
action taken or planned by another agency;
    (3) Materially alter the budgetary impact of entitlements, grants, 
user fees, or loan programs or the rights and obligations of recipients 
thereof; or
    (4) Raise novel legal or policy issues arising out of legal 
mandates, the President's priorities, or the principles set forth in 
this Executive Order.<SUP>16</SUP>
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    \16\ Id. at section 3(f)(1)-(4).
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    It has been determined that this rule is not a ``significant 
regulatory action'' under the terms of Executive Order 12866 and is 
therefore not subject to OMB review.

VI. Impact on Small Entities

    This action either eases or leaves unchanged requirements otherwise 
applicable to affected entities. Thus, EPA has determined that it will 
not result in a significant adverse impact on a substantial number of 
small entities.

VII. Paperwork Reduction Act

    The Paperwork Reduction Act of 1980, 44 U.S.C. 3501 et seq., and 
implementing regulations, 5 CFR part 1320, do not apply to this action 
as it does not involve the collection of information as defined 
therein.

VIII. Regulatory Flexibility Act

    The Regulatory Flexibility Act (RFA) generally requires an agency 
to conduct a regulatory flexibility analysis of any rule subject to 
notice and comment rulemaking requirements unless the agency certifies 
that the rule will not have a significant economic impact on a 
substantial number of small entities. Small entities include small 
businesses, small not-for-profit enterprises, and small governmental 
jurisdictions. This decision would not have a significant impact on a 
substantial number of small entities because the overall impact of this 
decision is a net decrease in requirements on all entities including 
small entities. Therefore, I certify that this action will not have a 
significant economic impact on a substantial number of small entities.

[[Page 63858]]

IX. Unfunded Mandates

    Under Section 202 of the Unfunded Mandates Reform Act of 1995 
(``Unfunded Mandates Act''), EPA must prepare a budgetary impact 
statement to accompany any proposed or final rule that includes a 
federal mandate that may result in estimated costs to state, local, or 
tribal governments in the aggregate, or to the private sector, of $100 
million or more. Under Section 205, EPA must select the most 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 exemption in this notice does not 
include a federal mandate that may result in estimated costs of $100 
million or more to those entities mentioned above. This federal action 
approves a request for exemption by petitioners in CNMI to reduce the 
cost of implementing the Clean Air Act. Accordingly, no additional 
costs to state, local, or tribal governments, or to the private sector 
result from this action.

X. Submission to Congress and the General Accounting Office

    Under 5 U.S.C. 801(a)(1)(A) as added by the Small Business 
Regulatory Enforcement Fairness Act of 1996, EPA submitted a report 
containing this decision and other required information to the U.S. 
Senate, the U.S. House of Representatives and the Comptroller General 
of the General Accounting Office prior to publication of the decision 
in today's Federal Register. This action is not a ``major rule'' as 
defined by 5 U.S.C. 804(2).

XI. Electronic Copies of Decision

    A copy of this action is available on the Internet at <a href="http://www.epa.gov/
OMSWWW">www.epa.gov/
OMSWWW</a> under the title: ``EPA Decision to Grant Conventional Gasoline 
Anti-dumping Exemption to the Commonwealth of the Northern Mariana 
Islands.''

XII. Statutory Authority

    Authority for the action described in this notice is in section 
325(a)(1) (42 U.S.C. 7625-1(a)(1)) of the Clean Air Act as amended.

    Dated: November 25, 1997.
Carol M. Browner,
Administrator.
[FR Doc. 97-31736 Filed 12-2-97; 8:45 am]
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