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[Federal Register Volume 76, Number 74 (Monday, April 18, 2011)]
[Rules and Regulations]
[Pages 21652-21660]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2011-9288]

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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 112

[EPA-HQ-OPA-2008-0821; FRL-9297-3]
RIN 2050-AG50

Oil Pollution Prevention; Spill Prevention, Control, and 
Countermeasure (SPCC) Rule--Amendments for Milk and Milk Product 
Containers

AGENCY: Environmental Protection Agency.

ACTION: Final rule.

-----------------------------------------------------------------------

SUMMARY: The U.S. Environmental Protection Agency (EPA or the Agency) 
is amending the Spill Prevention, Control, and Countermeasure (SPCC) 
rule to exempt all milk and milk product containers and associated 
piping and appurtenances from the SPCC requirements. The Agency is also 
removing the compliance date requirements for the exempted containers.

DATES: This final rule is effective on June 17, 2011.

ADDRESSES: The public docket for this rulemaking, Docket ID No. EPA-HQ-
OPA-2008-0821, contains the information related to this rulemaking, 
including the response to comments document. All documents in the 
docket are listed in the index at http://www.regulations.gov. Although 
listed in the index, some information may not be publicly available, 
such as Confidential Business Information (CBI) or other information 
the disclosure of which is restricted by statute. Certain other 
material, such as copyrighted material, will be publicly available only 
in hard copy. Publicly available docket materials are available either 
electronically at http://www.regulations.gov or in hard copy at the EPA 
docket, EPA/DC, EPA West, Room 3334, 1301 Constitution Ave., NW., 
Washington, DC. The Public Reading Room is open from 8:30 a.m. to 4:30 
p.m., Monday through Friday, excluding legal holidays. The telephone 
number of the Public Reading Room is 202-566-1744, and the telephone 
number to make an appointment to view the docket is 202-566-0276.

FOR FURTHER INFORMATION CONTACT: For general information, contact the 
Superfund, TRI, EPCRA, RMP, and Oil Information Center at 800-424-9346 
or TDD at 800-553-7672 (hearing impaired). In the Washington, DC 
metropolitan area, contact the Superfund, TRI, EPCRA, RMP, and Oil

[[Page 21653]]

Information Center at 703-412-9810 or TDD 703-412-3323. For more 
detailed information on specific aspects of this final rule, contact 
either Gregory Wilson at 202-564-7989 (wilson.gregory@epa.gov) or, 
Vanessa E. Principe at 202-564-7913 (principe.vanessa@epa.gov), U.S. 
Environmental Protection Agency, 1200 Pennsylvania Avenue, NW., 
Washington, DC 20460-0002, Mail Code 5104A.

SUPPLEMENTARY INFORMATION: The contents of this preamble are:

I. General Information
II. Entities Potentially Affected by This Final Rule
III. Statutory Authority and Delegation of Authority
IV. Background
V. This Action
    A. Finalize Modified Amendments
    1. Industry Sanitary Standards and Construction Requirements
    2. Summary of Comments
    3. Response to Comments
    4. Universe Affected by This Action
    B. Removal of Compliance Date for Exempted Containers, 
Associated Piping and Appurtenances
VI. Statutory and Executive Order Reviews
    A. Executive Orders 12866 and 13563: Regulatory Planning and 
Review
    B. Paperwork Reduction Act
    C. Regulatory Flexibility Act
    D. Unfunded Mandates Reform Act
    E. Executive Order 13132: Federalism
    F. Executive Order 13175: Consultation and Coordination With 
Indian Tribal Governments
    G. Executive Order 13045: Protection of Children From 
Environmental Health Risks and Safety Risks
    H. Executive Order 13211: Actions Concerning Regulations That 
Significantly Affect Energy Supply, Distribution, or Use
    I. National Technology Transfer and Advancement Act
    J. Executive Order 12898: Federal Actions To Address 
Environmental Justice in Minority Populations and Low-Income 
Populations
    K. Congressional Review Act

I. General Information

    On January 15, 2009, EPA proposed to amend the Spill Prevention, 
Control, and Countermeasure (SPCC) rule to tailor and streamline the 
requirements for the dairy industry. Specifically, EPA proposed to 
exempt milk containers and associated piping and appurtenances from the 
SPCC requirements provided they are constructed according to the 
current applicable 3-A Sanitary Standards, and are subject to the 
current applicable Grade ``A'' Pasteurized Milk Ordinance (PMO) or a 
State dairy regulatory requirement equivalent to the current applicable 
PMO. The Agency is modifying the proposed exemption to exempt all milk 
containers, and associated piping and appurtenances and is further 
extending the exemption to also include all milk product containers, 
and associated piping and appurtenances. Finally, the Agency is 
removing the compliance date requirements for the exempted containers.
    EPA estimates that dairy farms will incur an average annualized 
savings of $133 million and milk product manufacturing plants an 
average annualized savings of $13 million (estimates based on 2009$ and 
a 7% discount rate). In aggregate, the total annualized savings is 
estimated at $146 million. The Regulatory Impact analysis, which can be 
found in the docket, provides more detail of the cost savings and 
methodology.

                   Cost and Benefits of the Final Rule
------------------------------------------------------------------------
                                          Annualized cost savings
                                 ---------------------------------------
                                   Discounted at 3%    Discounted at 7%
------------------------------------------------------------------------
Costs...........................                  $0                  $0
Benefits (Cost Savings).........                 143                 146
Net Benefits (Benefits--Costs)..                 143                 146
------------------------------------------------------------------------

II. Entities Potentially Affected by This Final Rule

------------------------------------------------------------------------
                      Industry sector                         NAICS code
------------------------------------------------------------------------
Farms......................................................     111, 112
Food Manufacturing.........................................          311
------------------------------------------------------------------------

    The Agency's goal is to provide a guide for readers to consider 
regarding entities that potentially could be affected by this action. 
However, this action may affect other entities not listed in this 
table. If you have questions regarding the applicability of this action 
to a particular entity, consult the person listed in the preceding 
section entitled FOR FURTHER INFORMATION CONTACT.

III. Statutory Authority and Delegation of Authority

    Section 311(j)(1)(C) of the Clean Water Act (CWA or the Act), 33 
U.S.C. 1321(j)(1)(C), requires the President to issue regulations 
establishing procedures, methods, equipment, and other requirements to 
prevent discharges of oil to navigable waters or adjoining shorelines 
from vessels and facilities and to contain such discharges. The 
President delegated the authority to regulate non-transportation-
related onshore facilities to EPA in Executive Order 11548 (35 FR 
11677, July 22, 1970), which was replaced by Executive Order 12777 (56 
FR 54757, October 22, 1991). A Memorandum of Understanding (MOU) 
between the U.S. Department of Transportation (DOT) and EPA (36 FR 
24080, November 24, 1971) established the definitions of 
transportation-related and non-transportation-related facilities. An 
MOU between EPA, the U.S. Department of the Interior (DOI), and DOT (59 
FR 34102, July 1, 1994) re-delegated the responsibility to regulate 
certain offshore facilities from DOI to EPA.
    In 1995, Congress enacted the Edible Oil Regulatory Reform Act 
(EORRA), 33 U.S.C. 2720, which mandates that Federal agencies,\1\ in 
issuing or enforcing any regulation or establishing any interpretation 
or guideline relating to the transportation, storage, discharge, 
release, emission or disposal of oil, differentiate between and 
establish separate classes for the various types of oils, specifically: 
Animal fats and oils and greases, and fish and marine mammal oils; oils 
of vegetable origin; other non-petroleum oils and greases; and 
petroleum oils. In differentiating between these classes of oils, 
Federal agencies are directed to consider differences in the physical, 
chemical, biological, and other properties, and in the environmental 
effects of the classes.
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    \1\ The requirements of the Edible Oil Regulatory Reform Act do 
not apply to the Food and Drug Administration and the Food Safety 
and Inspection Service.
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IV. Background

    EPA promulgated a series of amendments to the SPCC rule in December 
2006, December 2008 and November 2009 that provided the

[[Page 21654]]

facility owner or operator with significant flexibility to comply with 
the SPCC regulatory requirements. Facilities handling animal fats and 
vegetable oils (AFVOs), subject to the SPCC rule because of their oil 
storage capacity, may benefit from a number of these amendments, which 
tailored prevention and control measures to the facility type and oils 
being stored. The provisions included streamlined requirements for 
qualified facilities and reduced requirements for a subset of those 
qualified facilities. The rule also amended the security, integrity 
testing, and facility diagram requirements, while exemptions were 
provided for pesticide application equipment and related mix 
containers, and for single-family residential heating oil containers. 
Finally, the amendments offered clarifications for fuel nurse tanks, 
wind farms and for the definition of ``facility.''
    Milk typically contains a percentage of animal fat, a non-petroleum 
oil. Thus, containers storing milk and milk products are currently 
subject to the SPCC rule when they meet the applicability criteria set 
forth in Sec.  112.1. In the SPCC rule, the term ``bulk storage 
container'' is defined at Sec.  112.2 as ``any container used to store 
oil.'' Therefore, bulk storage containers storing milk are currently 
subject to the applicable provisions under Sec.  112.12. Additionally, 
milk is processed in containers during the pasteurization process. 
These continuous pasteurizers, while not bulk storage containers, are 
considered oil filled-manufacturing equipment and are currently subject 
to the general provisions of the SPCC rule under Sec.  112.7. Finally, 
milk is also handled and transferred through piping and appurtenances 
associated with containers which are currently subject to certain 
provisions of the SPCC rule.
    In response to EPA's October 2007 proposal for amendments to the 
SPCC rule (72 FR 58378, October 15, 2007), several comments requested 
that EPA exempt containers used to store milk from the SPCC 
requirements. Specifically, these comments suggested that milk storage 
containers be exempted from the SPCC requirements because the Grade 
``A'' PMO addresses milk storage and tank integrity. The comments 
identified the PMO, which specifically addresses milk intended for 
human consumption, as a model ordinance maintained through a 
cooperative agreement between the States, the Food and Drug 
Administration (FDA), and the regulated community. States typically 
adopt the PMO either by reference, or by directly incorporating similar 
requirements into their statutes or regulations.
    Thus, on January 15, 2009, the Agency published a proposal to 
exempt from SPCC requirements milk containers and associated piping and 
appurtenances provided they are constructed according to current 
applicable 3-A Sanitary Standards, and are subject to the current 
applicable PMO or a State dairy regulatory requirement equivalent to 
the current applicable PMO [74 FR 2463].
    The Agency also requested comment on an exemption for milk product 
containers and their associated piping and appurtenances from the SPCC 
rule provided they are constructed in accordance with the current 
applicable 3-A Sanitary Standards, and are subject to the current 
applicable Grade ``A'' PMO sanitation requirements or a State dairy 
regulatory equivalent to the current applicable PMO. In addition, the 
Agency requested comment on how to address milk storage containers 
(including totes) that may not be constructed to 3-A Sanitary Standards 
under the SPCC rule and whether they should also be exempted from the 
SPCC requirements, provided they are subject to the current applicable 
Grade ``A'' PMO or a State dairy regulatory requirement equivalent to 
the current applicable PMO. Finally, the Agency requested comment on 
alternative approaches to address milk and milk product containers, 
associated piping and appurtenances under the SPCC rule.
    After the Agency's review of comments and consideration of all 
relevant facts, today's rule modifies the proposed exemption to exempt 
all milk containers, and associated piping and appurtenances and 
further extends the exemption to include all milk product containers, 
and associated piping and appurtenances. The Agency is also removing 
the compliance date requirements for the exempt containers.

V. This Action

A. Finalize Modified Amendments

    The Agency is exempting from the SPCC requirements milk and milk 
product containers, and associated piping and appurtenances. 
Additionally, the capacity of these exempted containers, and associated 
piping and appurtenances is not to be included in a facility's total 
oil storage capacity calculation (see Sec.  112.1(d)(2)(ii)). The 
Agency is also removing the compliance date requirements for the 
exempted containers.
    This preamble discusses these provisions, and any related comment 
received during the 2009 comment period, that raised substantive policy 
issues. For a complete discussion of the comments received in 2009, see 
Comment and Response Document Oil Pollution Prevention; SPCC Plan 
Requirements--Amendments, a copy of which is available in the docket 
for this rulemaking.
1. Industry Sanitary Standards and Construction Requirements
    Milk and milk product containers and their associated piping and 
appurtenances are generally constructed according to an industry 
standard established by the 3-A Sanitary Standards organization (3-A 
Sanitary Standards, Inc., McLean, VA, http://www.3-a.org) which satisfy 
the PMO model code construction requirements for milk and milk product 
containers and associated piping and appurtenances. These containers, 
associated piping and appurtenances may also be subject to the U.S. 
Department of Agriculture (USDA) Recommended Requirements for Milk for 
Manufacturing Purposes and its Production and Processing (Milk for 
Manufacturing Purposes and Its Production and Processing; Requirements 
Recommended for Adoption by State Regulatory Agencies; see http://www.ams.usda.gov/AMSv1.0/getfile?dDocName=STELDEV3004791). All milk 
handling operations subject to the PMO are required to have an 
operating permit, and are subject to inspection by State dairy 
regulatory agencies. The PMO model code establishes criteria for the 
permitting, inspection and enforcement of milk handling equipment and 
operations that govern all processes for milk intended for human 
consumption.
    Likewise, USDA has developed and maintains a set of model 
regulations relating to quality and sanitation requirements for the 
production and processing of manufacturing grade milk, which are 
recommended for adoption and enforcement by the various States that 
regulate manufacturing grade milk. The purpose of the model 
requirements is to promote uniformity in State dairy laws and 
regulations relating to manufacturing grade milk. These recommended 
requirements contain criteria similar to those of the PMO for milk for 
manufacturing purposes, including its processing, use, labeling and 
storage. Furthermore, these requirements include provisions for 
inspections, certification and licensing of facilities that handle and 
process milk for manufacturing purposes and its products. These 
requirements serve as the basis for the exemption of milk and milk 
product containers, and their associated piping and appurtenances

[[Page 21655]]

from the SPCC rule. Milk and milk product containers, associated piping 
and appurtenances are generally constructed in accordance with 
standards like the current applicable 3-A Sanitary Standards, and are 
subject to standards like the current applicable PMO sanitation 
requirements, USDA Recommended Requirements for Milk for Manufacturing 
Purposes and its Production and Processing, or equivalent State dairy 
regulations. The 3-A Sanitary Standards for equipment construction 
require the use of durable materials and sanitary construction criteria 
that can be easily maintained and kept clean and free of defects when 
appropriate cleaning procedures and chemicals are used. Both the PMO 
sanitation requirements and the USDA Recommended Requirements include 
construction and sanitation standards and frequent State and/or Federal 
inspections for these containers, piping and appurtenances, and provide 
definitions and/or list those milk and milk products to which they 
apply. State dairy requirements for permits/licenses, operations and 
inspections are generally structured to be equivalent to the current 
applicable PMO requirements and/or USDA Recommended Requirements. The 
Agency believes the combination of these specific standards and 
requirements address the prevention of oil discharges.
2. Summary of Comments
    Support for an Expanded Exemption. There was only one comment to 
the 2009 proposal, and it expressed general support for the exemption. 
The comment requested that EPA consider exempting all milk and milk 
products, including cheese, cream, yogurt and ice cream mix. The 
comment stated these products and their containers do not present a 
potential for spills into navigable waters of the United States because 
the equipment must be constructed to preclude deterioration and must be 
maintained to keep it clean and free of defects. The comment states 
that all dairy processing equipment, storage containers, piping and 
appurtenances are made of high grade stainless steel (with the 
exception of some cheese storage containers) and are designed and 
constructed in accordance with 3-A and/or FDA's Current Good 
Manufacturing Practices (CGMP) or equivalents. The comment also states 
that other requirements mandate frequent inspection of dairy operations 
for defects in equipment thereby making spillage and leakage highly 
improbable.
    Exemption of Solid Mixtures. The comment also requested that EPA 
exempt cheese and other mixtures that are solid at room temperature 
from the SPCC requirements. The comment included as an appendix a 
letter commenting on an earlier Agency action and requested an 
exemption of substances that are solid at ambient temperatures 
(including animal fats). The comment also stated that should a cheese 
production or storage facility catch fire, ``under no circumstances 
would cheese liquefy and flow'' out of the facility to potentially 
pollute or endanger navigable waters of the United States.
    Expand the Scope of Regulations and Standards To Qualify the 
Exemption. The comment requested that EPA broaden the scope of 
regulatory requirements and construction standards to exempt additional 
containers from the SPCC rule, specifically those that are subject to 
the Food and Drug Administration (FDA) requirements under 21 CFR Part 
110. The comment suggested the exemption state: ``The SPCC rule does 
not apply to storage containers and associated piping and appurtenances 
that contain milk or milk products that are: A) subject to the 
construction requirements of 3-A Sanitary Standards or the equivalent 
standards approved by a federal, state or local regulatory authority, 
and b) are subject to 21 CFR Part 110, the PMO, or a state or local 
equivalent.'' Additionally, the comment argued that, along with high 
sanitation standards for edible fats and oils, regulations issued by 
the Occupational Safety and Health Administration (OSHA) for worker 
safety address storage and use of oils at food facilities, thereby 
reducing the likelihood, rate and magnitude of a spill should an 
accident occur.
    Definition of Oil and Oil Mixtures. The comment also argued milk 
and milk products should not be defined as oil. The comment 
incorporates by reference statements that milk and other dairy products 
do not seem to meet the definition of ``oil'' because milk, ice cream 
mix, yogurt, cream, cheese and other dairy products are not (1) fat, 
oil or grease or (2) fat, oil or grease mixed with waste. The comment 
included as an appendix a letter to the Agency commenting on a separate 
action, stating there are minimal environmental risks resulting from 
edible fats and oils spills and EPA should exempt substances not listed 
on the U.S. Coast Guard list of petroleum and non-petroleum oils (e.g., 
milk or milk products). The comment requests EPA clarify the definition 
of oil and oil mixtures so that lower fat mixtures, e.g., those below 
50 percent fat, or those that are solid at room temperature might not 
be considered oil, thereby exempting most milk and milk products from 
the SPCC requirements. The commenter further requested EPA not initiate 
any enforcement actions against operations where there is substantial 
doubt regarding whether substances at those facilities are within the 
scope of the SPCC rule until EPA has clarified oil mixtures.
3. Response to Comments
    Support for an Expanded Exemption. EPA recognizes the merits to 
arguments supporting an exemption for milk product containers. Thus, 
EPA is amending the proposed exemption by exempting all milk 
containers, and associated piping and appurtenances and by further 
extending the exemption to include all milk product containers, and 
associated piping and appurtenances. The exempted containers include 
all milk and milk product containers as defined in the PMO model code, 
but also all milk and milk product containers subject to the USDA 
Recommended Requirements for Milk for Manufacturing Purposes and its 
Production and Processing. EPA also acknowledges that some milk and 
milk product handling operations are subject to 21 CFR 110. However, 
EPA believes that the dairy specific standards above apply to the vast 
majority of milk and milk product containers. The Agency could not 
identify any milk or milk product containers that are not subject to 
PMO, USDA Recommended Requirements for Milk for Manufacturing Purposes 
and its Production and Processing, or equivalent State dairy regulatory 
requirements and thus the final rule exempts all milk and milk product 
containers from the SPCC requirements.
    In this final rule, EPA is amending the scope of the exemption by 
exempting all milk containers, and associated piping and appurtenances 
and by further expanding the exemption to include all milk product 
containers, and associated piping and appurtenances. These exempted 
milk and milk product containers, and associated piping and 
appurtenances are constructed according to standards like the current 
applicable 3-A Sanitary Standards, and are subject to standards like 
the current applicable Grade ``A'' (PMO), USDA Recommended Requirements 
for Milk for Manufacturing Purposes and its Production and Processing, 
or equivalent State dairy regulatory requirements. Because of their 
operational requirements, particularly for permits/licenses and 
frequent inspections, the Agency expects the owner or operator of a 
facility with milk

[[Page 21656]]

and milk product containers subject to the 3-A Sanitary Standards, and 
PMO requirements, USDA Recommended Requirements for Milk for 
Manufacturing Purposes and its Production and Processing, or equivalent 
State dairy regulatory requirements, to be in compliance with those 
provisions in order to maintain their operations. For the purposes of 
this provision, ``equivalent'' means a State dairy regulation that 
includes all the components of the PMO model code and/or the USDA 
Recommended Requirements. All milk and/or milk product transfer and 
processing activities are included in the scope of this exemption from 
the SPCC rule.
    Exemption of Solid Mixtures. EPA disagrees that all oils or oil 
mixtures that are solid at room temperature should, as a general 
matter, be exempted from the SPCC rule. Vegetable oils and animal fats 
that are solid at room temperature serve as potent physical 
contaminants and are more difficult to remove from affected animals 
than petroleum oil (see 62 FR 54511, October 20, 1997).
    The Agency believes that spill prevention for milk and milk 
products produced for processing and manufacturing (e.g., butter, 
cheese, dry milk) are appropriately addressed through standards like 
the PMO model code, the USDA Recommended Requirements for Milk for 
Manufacturing Purposes and its Production and Processing, or equivalent 
State dairy regulatory requirements, and thus is extending the 
exemption to include all milk and milk product containers, associated 
piping and appurtenances.
    To decide whether a facility is subject to the SPCC rule, the owner 
or operator must first identify whether there is a reasonable 
expectation of an oil discharge to navigable waters or adjoining 
shorelines from the facility. The owner or operator of a facility may 
consider the nature and flow properties of the oils handled at the 
facility to make this determination (for more information, see Chapter 
2 of the SPCC Guidance for Regional Inspectors). If there is a 
reasonable expectation that any oil (in any container) at the facility 
may impact waters if discharged, then the next step is to determine the 
aboveground and completely buried storage capacity of all oil located 
at the facility (except for exempt containers). If the aboveground 
storage capacity is greater than 1,320 U.S. gallons or the completely 
buried capacity is greater than 42,000 U.S. gallons, then the facility 
is subject to the SPCC rule and the owner or operator must develop an 
SPCC Plan that describes oil handling operations, spill prevention 
practices, discharge or drainage controls, and the personnel, equipment 
and resources at the facility that are used to prevent oil spills from 
reaching navigable waters or adjoining shorelines. However, if the 
owner or operator of the facility determines there is not a reasonable 
expectation of discharge of oil to navigable waters or adjoining 
shorelines from all oils stored at the facility then the facility is 
not subject to the SPCC requirements. We recommend that the owner or 
operator document and date these determinations in the event that EPA 
challenges the determination following an inspection.
    The SPCC rule is primarily a performance-based rule, therefore, the 
owner or operator may consider the properties of each oil located at 
the facility to identify measures and procedures to prevent spills from 
the facility. For example, storage of an oil in solid form inside a 
building may provide adequate secondary containment. Additionally, many 
SPCC rule provisions allow for environmentally equivalent alternatives 
to be used (except for secondary containment) provided they are 
documented in the Plan and certified by a Professional Engineer (see 
Chapter 3 of the SPCC Guidance for Regional Inspectors for more 
information).
    Expand the Scope of Regulations and Standards To Qualify the 
Exemption. EPA agrees that the scope of the exemption should apply to 
all milk and milk product containers because they are subject to a 
combination of standards like the 3-A Sanitary Standards with either 
PMO or the USDA requirements or State equivalent dairy regulations. EPA 
is expanding the exemption because non-PMO milk and milk product 
containers are subject to standards like the USDA Recommended 
Requirements for Milk for Manufacturing Purposes and its Production and 
Processing, or equivalent State dairy regulations. The Agency believes 
the components of these requirements are comparable to the PMO 
requirements. Specifically, both PMO and USDA Recommended Requirements 
have provisions that include permitting/licensing, inspections, 
construction standards, operations, maintenance, enforcement and other 
sanitation requirements.
    All milk and milk product handling operations subject to the PMO 
and USDA Recommended Requirements must have an operating permit or 
license, and are subject to inspection by State dairy regulatory 
agencies. Both the PMO and the USDA Recommended Requirements establish 
criteria for the permitting/licensing, inspection and enforcement of 
handling equipment and operations that typically govern processes for 
milk and milk products intended for human consumption and for milk 
produced for processing and manufacturing products for human 
consumption. These include, but are not limited to, specifications for 
the design and construction of milk and milk product handling 
equipment, equipment sanitation and maintenance procedures, temperature 
controls, and pasteurization standards. In addition, because many kinds 
of harmful bacteria can grow rapidly in milk and milk products, and 
thus, to ensure a proper sanitary environment, standards like both the 
PMO and the USDA Recommended Requirements require that milk and milk 
product containers be frequently emptied, cleaned, inspected and 
sanitized and that records of such events be maintained. Such frequent 
cleaning and inspection of the containers suggests that any leaks or 
deterioration of container integrity would be quickly identified. PMO 
and USDA Recommended Requirements also require inspections of 
facilities with such milk and milk products handling operations by the 
State-designated regulatory agency prior to issuing a permit or 
license, and routine inspections thereafter (for example, at dairy 
farms covered by PMO at least once every six months) by a State 
designated regulatory agency. Inspections at these facilities encompass 
those elements associated with the milk and milk products operation, 
including the containers, and associated piping and appurtenances. 
Violations of the permitting or licensing requirements may result in 
the suspension or revocation of the facility's operating license or 
permit.
    USDA regulations, guidelines and recommended requirements all 
recognize the unique nature in which milk and milk products are handled 
and stored in contrast to other oils intended for human consumption. 
Subpart D--Farm Requirements for Milk for Manufacturing of the USDA 
Recommended Requirements for Milk for Manufacturing Purposes and its 
Production and Processing requires that farm bulk tanks meet 3-A 
Sanitary Standards for construction at the time of installation, that 
they be installed in accordance with USDA regulations, and that all new 
utensils and equipment be in compliance with applicable 3-A Sanitary 
Standards. Furthermore USDA regulation under 7 CFR 58.128(d) requires 
new or replacement storage

[[Page 21657]]

tanks or vats to comply with the appropriate 3-A Sanitary Standards 
(i.e., Storage Tanks for Milk and Milk Products or Sanitary Standards 
for Silo-Type Storage Tanks for Milk and Milk Products). According to 
USDA Guidelines for the Sanitary Design and Fabrication of Dairy 
Processing Equipment, ``Dairy Grading Branch policy fully supports and 
utilizes established 3-A Sanitary Standards and Accepted Practices.'' 
Furthermore the document says ``When a USDA-Dairy Grading Branch review 
is requested of equipment for which there are no 3-A Sanitary Standards 
or Accepted Practices, USDA will use the general criteria, guidelines, 
and principles outlined in this document. These criteria, guidelines, 
and principles are consistent with those utilized by the 3-A Sanitary 
Standards Committees during the development of standards and accepted 
practices.''
    Although OSHA worker safety regulations may apply to facilities 
with milk or milk product containers, their requirements specifically 
focus on worker safety and do not address container design or container 
inspection practices as in the case of the PMO or USDA requirements and 
the 3-A Sanitary Standards. The FDA requirements under 21 CFR Part 110, 
are current good manufacturing practices in manufacturing, packing, or 
holding human food and apply to all foods under FDA jurisdiction; 
whereas PMO and USDA requirements are specific to milk and milk 
products. The PMO model code and the USDA Recommended Requirements are 
specific to milk and milk products and serve to minimize their 
potential for discharge because they include permitting or licensing of 
facilities, strict inspection frequencies and enforcement procedures, 
among others. The monitoring and sanitation standards under PMO and 
USDA serve in part as spill prevention measures because the frequent 
cleaning and inspections of the milk and milk product containers, 
associated piping and appurtenances leads to early identification of 
equipment failure, and spill detection. Failure to comply with these 
provisions may lead to a suspension of licenses or permits issued under 
PMO or USDA.
    Definition of Oil and Oil Mixtures. EPA does not agree with the 
comment that milk is not an oil. Milk and other milk products comprised 
of animal fats meet both the definition of oil and of non-petroleum oil 
included in Sec.  112.2 of the rule. EPA has an established record of 
including animal fats and vegetable oils in planning and spill 
prevention requirements (see 40 FR 28849, July 9, 1975; and 62 FR 
54509, October 20, 1997). The SPCC rule defines oil as ``oil of any 
kind or in any form, including, but not limited to: Fats, oils, or 
greases of animal, fish, or marine mammal origin; vegetable oils, 
including oils from seeds, nuts, fruits, or kernels; and, other oils 
and greases, including petroleum, fuel oil, sludge, synthetic oils, 
mineral oils, oil refuse, or oil mixed with wastes other than dredged 
spoil.'' (40 CFR 112.2) The rule further defines non-petroleum oil as 
``oil of any kind that is not petroleum-based, including, but not 
limited to: Fats, oils, and greases of animal, fish, or marine mammal 
origin; and vegetable oils, including oils from seeds, nuts, fruits, 
and kernels.'' Both definitions qualify the listed examples with the 
statement ``including but not limited to'' which indicates that these 
definitions are not limited by the examples provided.
    EPA disagrees with the comment that edible fats and oils pose 
minimal environmental risks. In a notice published on October 20, 1997 
(62 FR 54508), EPA denied a request submitted by various trade 
associations to treat facilities that handle, store, or transport 
animal fats and vegetable oils in a manner differently from those 
facilities that store petroleum-based oils. The petitioners claimed 
that unlike most if not all other oils, animal fats and vegetable oils 
are non-toxic, readily biodegradable, not persistent in the 
environment, and in fact are essential components of human and wildlife 
diets. EPA agrees with the comment that animal fats and vegetable oils, 
which are consumed in small amounts, are an essential component of 
human and wildlife diets. However, large amounts of such oils, when 
discharged into navigable waters or adjoining shorelines, present 
significant risks to the environment, including wildlife. In fact, the 
environmental effects of petroleum and non-petroleum oils, including 
vegetable oils and animal fats, are similar because of the physical and 
chemical properties common to both. (See Federal Register notice at 62 
FR 54508; October 20, 1997 for more information on the environmental 
effects of oil spills of edible fats and oils.)
    EPA acknowledges that the U.S. Coast Guard list of petroleum and 
non-petroleum oils \2\ does not specifically list milk or milk 
products; however, this does not provide an adequate basis to exempt 
milk or milk products from the SPCC rule, especially since they meet 
the definition of oil under the SPCC rule. Moreover, the U.S. Coast 
Guard list only includes examples of oils and is not meant to be all-
inclusive. The examples are organized alphabetically into several 
subgroups, including a group for edible animal and vegetable oils and 
other oils of animal or vegetable origin (which have historically been 
considered Clean Water Act (CWA) oils). While milk and milk products 
are not specifically included on the Coast Guard list, for purposes of 
SPCC, they fall under the category of edible animal and vegetable oils.
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    \2\ The U.S. Coast Guard List Of Petroleum and Non-petroleum 
Oils can be found at: http://homeport.uscg.mil/mycg/portal/ep/contentView.do?contentTypeId=2&channelId=-30565&contentId=120944&programId=117833&programPage=%2Fep%2Fprogram%2Feditorial.jsp&pageTypeId=13489.
---------------------------------------------------------------------------

    Finally, the Agency did not propose changes to the definitions of 
oil or oil mixture and therefore defining oil and/or oil mixtures are 
issues outside the scope of this action. Furthermore, EPA will continue 
to enforce the Oil Pollution Prevention regulations for oil mixtures. 
The owner or operator of a SPCC-subject facility should consider the 
definition of oil included in Sec.  112.2 of the rule and the CWA 
definition of oil when making determinations on how to address the SPCC 
requirements.
4. Universe Affected by This Action
    The approach in this action addresses the concerns raised by the 
dairy industry for milk producers (dairies) and milk product facilities 
subject to the SPCC requirements. In 2009, the National Agricultural 
Statistics Service (NASS), an agency within the USDA, estimated there 
were 65,000 operations with one or more milk cows and 1,178 facilities 
manufacturing one or more dairy products (excluding fluid milk 
products) in the United States. Most of the 65,000 operations with milk 
cows produce only fluid milk (subject to the PMO or the USDA 
Recommended Requirements) and their milk storage containers would be 
exempted. Manufactured dairy facilities handle milk and milk products 
subject to standards such as either the PMO or the USDA Recommended 
Requirements, and all their milk/milk product storage containers are 
also exempt. Milk or milk product containers not under the PMO or the 
USDA Recommended Requirements are generally covered by an equivalent 
State dairy regulation; all these State regulated milk and milk product 
containers are also exempt. This action exempts the entire universe of 
milk and milk product containers, and associated piping and 
appurtenances.
    Note that milk and milk product facilities may handle other oils 
subject

[[Page 21658]]

to the SPCC requirements. These facilities either have or are 
developing SPCC Plans in anticipation of the compliance date, but will 
not have to account for, or address the exempted containers in their 
SPCC Plans. Some of these facilities may now be either exempt, or 
eligible as a qualified facility to self-certify the facility's SPCC 
Plan. In addition, ``micro'' processor facilities that process one milk 
product are expected to manufacture and/or store quantities below the 
SPCC applicability thresholds for container or aggregate quantities 
(e.g., 1,000 pounds of cheese per month; self-bottling milk for farm 
consumption). The container sizes at these facilities are typically 
below the 55-gallon de minimis container size of the SPCC rule and 
therefore, are unlikely to be subject to SPCC requirements (see SPCC 
Guidance for Regional Inspectors for more information).

B. Removal of Compliance Date for Exempted Containers, Associated 
Piping and Appurtenances

    On October 14, 2010, the Agency delayed the compliance date by 
which facilities must address milk and milk product containers, 
associated piping and appurtenances that are constructed according to 
the current applicable 3-A Sanitary Standards, and subject to the 
current applicable Grade ``A'' PMO or a State dairy regulatory 
requirement equivalent to the current applicable PMO (see 75 FR 63093). 
The date by which the owner or operator of a facility must comply with 
the SPCC requirements for these milk and milk product containers was 
delayed one year from the effective date of a final rule specifically 
addressing these milk and milk product containers, associated piping 
and appurtenances, or as specified by a rule that otherwise establishes 
a compliance date for these facilities. This delay of the compliance 
date was to provide time for certain facilities to undertake the 
actions necessary to prepare or amend their SPCC Plans, as well as 
implement them. Today's action specifically addresses those milk and 
milk product containers, associated piping and appurtenances for which 
the delay was established and does so by exempting them from any SPCC 
regulatory requirements. Thus, a date for the exempted containers to 
come into compliance with SPCC requirements is no longer necessary. As 
such, the Agency is removing the regulatory requirement to comply with 
SPCC for these exempt containers by a date certain. The Agency provided 
notice of its intent in the October 14, 2010 final rule. The regulatory 
text is amended by removing and reserving 112.3(c).
    This action does not affect the owner or operator's responsibility 
to prevent oil discharges, including those of milk or milk products, 
into navigable waters or adjoining shorelines. These discharges may be 
subject to other applicable statutes and regulations, including but not 
limited to Section 311 of the Clean Water Act, 33 U.S.C. 1321.

VI. Statutory and Executive Order Reviews

A. Executive Orders 12866 and 13563: Regulatory Planning and Review

    Under section 3(f)(1) of Executive Order (EO) 12866 (58 FR 51735, 
October 4, 1993) and Executive Order 13563 (76 FR 3821, January 18, 
2011), this action is an ``economically significant regulatory action'' 
because it is likely to have an annual effect on the economy of $100 
million or more. Accordingly, EPA submitted this action to the Office 
of Management and Budget (OMB) for review under EOs 12866 and 13563 and 
any changes made in response to OMB recommendations have been 
documented in the docket for this action.
    In addition, EPA prepared an analysis of the potential costs and 
benefits associated with this action. This analysis is contained in 
``Regulatory Impact Analysis for the Final Amendment to the Oil 
Pollution Prevention Regulations to Exempt Certain Milk and Milk 
Product Containers and Associated Piping and Appurtenances (40 CFR part 
112).'' A copy of the analysis is available in the docket for this 
action and the analysis is briefly summarized in section VI-C.

B. Paperwork Reduction Act

    This action does not impose any new information collection burden. 
The final rule amendment exempts from the SPCC rule milk and milk 
product containers, associated piping and appurtenances. The Office of 
Management and Budget (OMB) has previously approved the information 
collection requirements contained in the existing regulations, 40 CFR 
part 112, under the provisions of the Paperwork Reduction Act, 44 
U.S.C. 3501 et seq. Burden is defined at 5 CFR 1320.3(b).
    An Agency may not conduct or sponsor, and a person is not required 
to respond to, a collection of information unless it displays a 
currently valid OMB control number. The OMB control numbers for EPA's 
regulations in 40 CFR are listed in 40 CFR part 9.

C. Regulatory Flexibility Act

    The Regulatory Flexibility Act generally requires an agency to 
prepare a regulatory flexibility analysis of any rule subject to notice 
and comment rulemaking requirements under the Administrative Procedure 
Act or any other statute 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 organizations, 
and small governmental jurisdictions.
    For purposes of assessing the impacts of this final rule on small 
entities, a small entity is defined as: (1) A small business as defined 
in the U.S. Small Business Administration (SBA)'s regulations at 13 CFR 
121.201--SBA defines small businesses by category of business using 
North American Industry Classification System (NAICS) codes, and in the 
case of dairy farms, which constitute a large percentage of the 
facilities affected by this final rule, defines small businesses as 
having less than $0.75 million per year in sales receipts; (2) a small 
governmental jurisdiction that is a government of a city, county, town, 
school district or special district with a population of less than 
50,000; and (3) a small organization that is any not-for-profit 
enterprise that is independently owned and operated and is not dominant 
in its field.
    After considering the economic impacts of this final rule on small 
entities, the Agency certifies that this action will not have a 
significant economic impact on a substantial number of small entities 
since the rule relieves regulatory burden, or otherwise has a positive 
economic effect on all of the small entities subject to the rule. The 
impact of concern is any significant, adverse economic impact on small 
entities, since the primary purpose of the regulatory flexibility 
analyses is to identify and address regulatory alternatives ``which 
minimize any significant economic impact of the * * * rule on small 
entities'' (5 U.S.C. 603 and 604).
    Under this final rule, EPA is exempting from SPCC rule requirements 
milk and milk product containers, associated piping and appurtenances 
because they are generally designed, constructed and maintained 
according to the standards such as the current applicable 3-A Sanitary 
Standards, and are subject to the standards such as the current 
applicable Grade ``A'' PMO, USDA Recommended Requirements for Milk for 
Manufacturing Purposes and its Production and Processing, or an

[[Page 21659]]

equivalent State dairy regulatory requirement. Overall, EPA estimates 
that this final action will reduce annual compliance costs by 
approximately $146 million for owners and operators of affected 
facilities. Total costs were annualized over a 10-year period using a 7 
percent discount rate. To derive this savings estimate, EPA first 
estimated the number of dairy farms and milk processing facilities that 
will be affected each year (2010-2019) by the final rule. EPA next 
analyzed the expected milk and fuel oil storage capacity of dairy farms 
with varying numbers of cattle based on daily production rate per cow, 
the storage requirements for milk, and conversations with industry 
representatives. EPA also estimated the milk/milk product and fuel oil 
storage capacity of milk processing facilities, and estimated the cost 
savings associated with the exemption for milk/milk product storage 
containers at both dairy farms and milk processing facilities. These 
savings include secondary containment costs, cost savings from 
preparing and maintaining an SPCC Plan for a smaller facility, and, for 
Qualified Facilities, preparing only a Plan Template and saving PE 
certification costs. A certain number of dairy farms are expected to 
become exempt as a result of the amendments. While the Agency extended 
the exemption to include milk product containers, piping and 
appurtenances, it does not have data on the number of milk product 
containers at milk product manufacturing facilities to determine the 
overall cost savings for the exemption. Therefore, EPA expects that the 
total cost savings for the final rule is underestimated.
    EPA, therefore, concludes that this final rule will relieve 
regulatory burden for small entities and certifies that this action 
will not have a significant economic impact on a substantial number of 
small entities. EPA requested comment on potential impacts on small 
entities, but received no comments specific to small entities.

D. Unfunded Mandates Reform Act

    This action contains no Federal mandates under the provisions of 
Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), 2 U.S.C. 
1531-1538 for State, local, or Tribal governments or the private 
sector. The action imposes no enforceable duty on any State, local or 
Tribal governments or the private sector; therefore, this action is not 
subject to the requirements of sections 202 or 205 of the UMRA. This 
action is also not subject to the requirements of section 203 of UMRA 
because it contains no regulatory requirements that might significantly 
or uniquely affect small governments; the amendments impose no 
enforceable duty on any small government.

E. Executive Order 13132: Federalism

    Executive Order 13132, entitled ``Federalism'' (64 FR 43255, August 
10, 1999), requires EPA to develop an accountable process to ensure 
``meaningful and timely input by State and local officials in the 
development of regulatory policies that have federalism implications.'' 
``Policies that have federalism implications'' is defined in the 
Executive Order to include regulations that have ``substantial direct 
effects on the States, on the relationship between the national 
government and the States, or on the distribution of power and 
responsibilities among the various levels of government.''
    This final rule does not have federalism implications. It will not 
have substantial direct effects on the States, on the relationship 
between the national government and the States, or on the distribution 
of power and responsibilities among the various levels of government, 
as specified in Executive Order 13132. Under the Clean Water Act (CWA) 
section 311(o), States may impose additional requirements, including 
more stringent requirements, relating to the prevention of oil 
discharges to navigable waters or adjoining shorelines. EPA recognizes 
that some States have more stringent requirements (56 FR 54612, October 
22, 1991). This final rule would not preempt State law or regulations. 
Thus, Executive Order 13132 does not apply to this final rule.

F. Executive Order 13175: Consultation and Coordination With Indian 
Tribal Governments

    This action does not have Tribal implications, as specified in 
Executive Order 13175 (65 FR 67249, November 9, 2000). This final rule 
will not significantly or uniquely affect communities of Indian Tribal 
governments. Thus, Executive Order 13175 does not apply to this final 
rule. EPA specifically solicited additional comment on this action from 
Tribal officials, but none was received.

G. Executive Order 13045: Protection of Children From Environmental 
Health Risks and Safety Risks

    EPA interprets Executive Order 13045 as applying only to those 
regulatory actions that are based on health or safety risks, such that 
the analysis required under section 5-501 of the Order has the 
potential to influence the regulation. This final rule is not subject 
to Executive Order 13045 because it does not establish an environmental 
standard intended to mitigate health or safety risks.

H. Executive Order 13211: Actions Concerning Regulations That 
Significantly Affect Energy Supply, Distribution, or Use

    This action is not a ``significant energy action'' as defined in 
Executive Order 13211 (66 FR 18355 (May 22, 2001)), because it is not 
likely to have a significant adverse effect on the supply, 
distribution, or use of energy. The overall effect of the final rule is 
to decrease the regulatory burden on certain facility owners or 
operators subject to its provisions.

I. National Technology Transfer and Advancement Act

    Section 12(d) of the National Technology Transfer and Advancement 
Act of 1995 (``NTTAA''), Public Law No. 104-113 (15 U.S.C. 272 note) 
directs EPA to use voluntary consensus standards in its regulatory 
activities unless to do so would be inconsistent with applicable law or 
otherwise impractical. Voluntary consensus standards are technical 
standards (e.g., materials specifications, test methods, sampling 
procedures, and business practices) that are developed or adopted by 
voluntary consensus standards bodies. NTTAA directs EPA to provide 
Congress, through OMB, explanations when the Agency decides not to use 
available and applicable voluntary consensus standards.
    The owner or operator of a facility subject to the SPCC rule has 
the flexibility to consider applicable industry standards in the 
development of an SPCC Plan, in accordance with good engineering 
practice. EPA solicited comments on this aspect of the rulemaking and, 
specifically, invited the public to identify potentially applicable 
voluntary consensus standards and to explain why such standards should 
be used in this regulation. The single comment submitted agreed with 
the use of the 3-A Sanitary Standards and the PMO model code as a basis 
for exempting milk and milk product containers, associated piping and 
appurtenances from the SPCC requirements. However, this rulemaking does 
not involve technical standards, as it does not set or incorporate by 
reference any one specific technical standard. Therefore, the NTTAA 
does not apply.

[[Page 21660]]

J. Executive Order 12898: Federal Actions To Address Environmental 
Justice in Minority Populations and Low-Income Populations

    Executive Order (EO) 12898 (59 FR 7629 (Feb. 16, 1994)) establishes 
Federal executive policy on environmental justice. Its main provision 
directs Federal agencies, to the greatest extent practicable and 
permitted by law, to make environmental justice part of their mission 
by identifying and addressing, as appropriate, disproportionately high 
and adverse human health or environmental effects of their programs, 
policies, and activities on minority populations and low-income 
populations in the United States.
    EPA has determined that this final rule will not have 
disproportionately high and adverse human health or environmental 
effects on minority or low-income populations because it does not 
affect the level of protection provided to human health or the 
environment.

K. Congressional Review Act

    The Congressional Review Act, 5 U.S.C 801 et seq., as added by the 
Small Business Regulatory Enforcement Fairness Act of 1996, generally 
provides that before a rule may take effect, the agency promulgating 
the rule must submit a rule report, which includes a copy of the rule, 
to each House of the Congress and to the Comptroller General of the 
United States. EPA will submit a report containing this rule and other 
required information to the U.S. Senate, the U.S. House of 
Representatives, and the Comptroller General of the United States prior 
to publication of the rule in the Federal Register. A Major rule cannot 
take effect until 60 days after it is published in the Federal 
Register. This action is a ``major rule'' as defined by 5 U.S.C. 
904(2). This rule will be effective June 17, 2011.

List of Subjects in 40 CFR Part 112

    Environmental protection, Animal fats and vegetable oils, Farms, 
Milk, Milk products, Oil pollution, Tanks, Water pollution control, 
Water resources.

    Dated: April 12, 2011.
Lisa P. Jackson,

Administrator.
    For the reasons stated in the preamble, the Environmental 
Protection Agency amends 40 CFR part 112 as follows:

PART 112--OIL POLLUTION PREVENTION

0
1. The authority citation for part 112 continues to read as follows:

    Authority: 33 U.S.C. 1251 et seq.; 33 U.S.C. 2720; and E.O. 
12777 (October 18, 1991), 3 CFR, 1991 Comp., p. 351.

Subpart A--[Amended]

0
2. Amend Sec.  112.1 by adding paragraphs (d)(2)(ii)(F) and (d)(12) to 
read as follows:

Sec.  112.1  General applicability.

* * * * *
    (d) * * *
    (2) * * *
    (ii) * * *
    (F) The capacity of any milk and milk product container and 
associated piping and appurtenances.
* * * * *
    (12) Any milk and milk product container and associated piping and 
appurtenances.
* * * * *

Sec.  112.3  [Amended]

0
3. Amend Sec.  112.3 by removing and reserving paragraph (c).

[FR Doc. 2011-9288 Filed 4-15-11; 8:45 am]
BILLING CODE 6560-50-P
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