Revisions to Air Plan; Arizona; Stationary Sources; New Source Review

EPA's Response to Public Comments on a Notice of Proposed Rulemaking

New or Amended Rules from Arizona Administrative Code, Title 18, Chapter 2, Articles 1, 2, 3, 

and 4; New or Amended Statutory Provisions from Arizona Revised Statutes, Title 49, Chapter 1 

Response to Comments 

Docket ID: EPA-R09-OAR-2015-0187

June 2015
Response to Comments

AZ NSR SIP Submittal 

June 2015

Page 2 of 43

1. Introduction 

On March 18, 2015, the U.S. Environmental Protection Agency (EPA) provided notice of, and requested 

public comment on, a proposed Clean Air Act (CAA or Act) rulemaking to revise certain portions of the 

Arizona State Implementation Plan (SIP) for the Arizona Department of Environmental Quality (ADEQ). 

80 FR 14044 (Mar. 18, 2015). This document provides excerpts or summaries of the public comments 

received by EPA on our proposed action on the ADEQ New Source Review (NSR)1 SIP submittal.2 Our 

responses to the comments made are provided below. In some cases, similar comments are grouped 

together and addressed by one EPA response. The full text of all public comments and other 

documents relevant to this action are available in the docket (visit www.regulations.gov and search by 

the Docket ID: EPA-R09-OAR-2015-0187).

Commenters:

• Robert Ukeiley

• Barbara Sprungl, Salt River Project Agricultural Improvement and Power District (SRP)

• Eric Massey, Arizona Department of Environmental Quality (ADEQ)

2. Comments and Responses

PM2.5 Increments

Comment 1: 

(Commenter: Robert Ukeiley)

The Federal Register notice does not make it clear if the Arizona rules proposed to be approved into 

the SIP include the PM2.5 increments. EPA must disapprove this rule if it does not include the PM2.5

increments.

Response 1:

In EPA’s March 18, 2015 Federal Register notice, we proposed to approve ADEQ rule R18-2-218 into 

the Arizona SIP, and stated “ADEQ adopted the increments, or maximum allowable increases, in R18-2-

218 – Limitation of Pollutants in Classified Attainment Areas.” 80 FR 14044, 14045, 14051. The PM2.5

increments are included in Section A of ADEQ rule R18-2-218. As such, ADEQ submitted, and we are 

approving into the Arizona SIP, ADEQ rule R18-2-218 containing the PM2.5 increments.3

 1 By “NSR” or “NSR program” we are generally referring to the collective requirements of the minor NSR, Prevention of 

Significant Deterioration (PSD) and Nonattainment NSR (NA-NSR) programs. 2 The SIP revisions that are the subject of this action are referred to herein as ADEQ’s “NSR SIP submittal,” although the 

revisions and our current action also address two rules and one statutory provision that are not directly related to NSR.

3 Our proposed action also points out that certain terminology used in ADEQ’s PSD rules with respect to the increments is 

not clear, and that ADEQ’s rules contain provisions that allow for exclusions from increment consumption for certain 

temporary emissions that do not conform to the analogous federal regulatory requirements. These issues provided a basis 

for our proposed limited disapproval of ADEQ’s PSD program. See Section II.C.1 of the preamble at 80 FR 14051. Neither 

this commenter nor any other commenter addressed these specific issues, thus we continue to believe that these issues are 
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ADEQ’s Methodology for Establishing Minor NSR Thresholds

Comment 2: 

(Commenter: ADEQ)

ADEQ states that its methodology for establishing minor NSR thresholds was valid for all areas under 

ADEQ’s jurisdiction. The Clean Air Act does not impose strict, specific requirements on NSR programs 

for minor sources, as it does for major NSR. Rather, section 110(a)(2)(C) generally requires that each 

state include a program regulating the modification and construction of any stationary source as 

necessary to assure achievement of the NAAQS. The sizes of minor source facilities, buildings, 

structures, or installations are assessed and compared to threshold levels to determine whether their 

potential to emit is so high as to affect the NAAQS. Each state establishes its own threshold levels to 

define the limits of its minor NSR regulations to create an effective pollution control strategy without 

also creating unnecessary regulatory burden.

Citing EPA’s proposed Tribal NSR Rule, ADEQ states that in the past, EPA has asserted that threshold 

levels are appropriate where “sources and modifications with emissions below the thresholds are 

inconsequential to attainment and maintenance of the NAAQS.”4 In creating a federal minor NSR 

program for Indian Country, EPA emphasized the importance of a cost-effective plan, as well as one 

that reduces the burden on sources and reviewing authorities.

ADEQ set an adequate, yet cost-effective threshold level of one half the significant level

(SL) for nonattainment areas. Just as EPA did in the Tribal Minor NSR Rule, ADEQ identified the level at 

which a lower threshold merely creates a larger pool of regulated minor sources without substantially 

reducing emissions. Research data provided by a consultant was used to make an informed 

determination which threshold levels would in fact be most cost-effective, while still achieving the 

goals of the minor source program. ADEQ included a table of the results provided by its contractor for 

two potential NSR threshold scenarios.5 Scenario 1 illustrates the impact of a minor threshold of one 

half the SL and Scenario 2 illustrates the impact of a threshold set at one quarter the SL. Lowering the 

threshold beyond one half the SL essentially doubles the percentage of sources regulated, which 

certainly increases the state’s ability to reach more minor sources. However, regulating more sources 

does not necessarily translate to effective emissions reductions. Rather there is a diminishing return on 

emission reductions as the threshold level is pushed further down to include sources with fewer 

emissions. 

ADEQ illustrated this statement through a figure provided in its comments showing a comparison of 

potential threshold levels and relative impact, by pollutant.6 The figure compares the percent of 

emissions regulated with the percent of sources regulated at the two NSR exemption scenarios 

 

deficiencies that ADEQ must correct for full approval of the PSD portion of the ADEQ NSR SIP submittal, and these issues 

provide a basis for our final limited disapproval. 

4 71 FR 48696, 48701 (Aug. 21, 2006). 5 EPA provided the same table in its TSD for this action. See Table 5 of the TSD - Results of ADEQ’s Stationary Source 

Distribution Analysis.

6 See ADEQ’s April 17, 2015 comment letter at 14.
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considered by ADEQ. ADEQ states that the slopes between the significance level points in the graph for 

each pollutant illustrate the incremental percentage of emissions that would be covered when the 

threshold level is moved from one half to one quarter. Both possible threshold options would result in 

a relatively large percentage of emissions from minor sources becoming subject to regulation. 

However, the average emissions covered per source decreases significantly for all additional sources 

that fall below one half of the significant level. The disproportionate effect between the changes in the 

amount of sources relative to the change in the amount of emissions covered provides a firm basis for 

ADEQ’s decision. The thresholds in ADEQ’s minor NSR program meet federal requirements without 

creating a system in which the burdens of regulation would outweigh the benefits to air quality.

Response 2:

As noted by ADEQ, CAA section 110(a)(2) generally requires that each state include a program 

regulating the modification and construction of any stationary source as necessary to assure 

achievement of the NAAQS. While we appreciate ADEQ’s comments on this issue, to date, ADEQ has 

not provided sufficient information about the nature, scope and emissions that are contributing to 

nonattainment in the areas subject to ADEQ’s jurisdiction to change our proposed determination that 

ADEQ has not provided an adequate basis for its NSR exemption thresholds as applied in such 

nonattainment areas. 

The implementing regulations for the minor NSR program make clear that SIPs must include legally 

enforceable procedures that enable the decisionmaking authority to determine whether the 

construction or modification of stationary sources will result in a violation of applicable portions of the 

control strategy or interfere with attainment or maintenance of the NAAQS, and that such procedures 

include means by which the decisionmaking authority can prevent such construction or modification if 

it will result in such violation or interference. 40 CFR 51.160(a) and (b). Further, 40 CFR 51.160(e) 

provides:

The procedures must identify types and sizes of facilities, buildings, structures or installations 

which will be subject to review under this section. The plan must discuss the basis for 

determining which facilities will be subject to review.

Under CAA section 110(a)(2) and 40 CFR 51.160(e), we agree with ADEQ that States are not necessarily 

required to regulate all stationary sources under the minor NSR program. States can exempt from 

review those stationary sources with emissions that they can demonstrate would not pose a threat to 

the attainment or maintenance of the NAAQS, thereby satisfying the requirement in CAA section 

110(a)(2)(C) that their minor NSR program regulate the modification and construction of any stationary 

source within the areas covered by the plan as necessary to ensure that the NAAQS are achieved. EPA’s 

interpretation was discussed in the proposal for our Tribal Minor NSR Rule:

A review of several State minor NSR programs indicated that a number of State programs have 

established cutoff levels or minor NSR thresholds, below which sources are exempt from their 

minor NSR rules. We believe that such an approach is also appropriate in Indian country. 

Section 110(a)(2)(C) of the Act requires minor NSR programs to assure that the NAAQS are 
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attained and maintained. Applicability thresholds are proper in this context provided that the 

sources and modifications with emissions below the thresholds are inconsequential to 

attainment and maintenance of the NAAQS. For each pollutant, only around 1 percent (or less) 

of total emissions would be exempt under the minor NSR program.

Review of New Sources and Modifications in Indian Country, Proposed Rule, 71 FR 48696, 48703 (Aug. 

21, 2006); see also Review of New Sources and Modifications in Indian Country, Final Rule, 76 FR 38758

(finding that sources with emissions below the permitting exemption thresholds selected by EPA in the 

Tribal Minor NSR Rule would be inconsequential to attainment or maintenance of the NAAQS). We 

note that in our Tribal NSR Rule, “the selected minor source thresholds distinguish between minor 

stationary sources of regulated NSR pollutants located in nonattainment areas and attainment areas,” 

with lower thresholds in nonattainment areas. 71 FR at 48702; see 76 FR at 38758 (finalizing thresholds 

as proposed).

In our proposed action on ADEQ’s NSR SIP submittal, we found deficiencies in the basis ADEQ provided 

for determining which sources would be subject to review under its minor NSR program under 40 CFR 

51.160(e), applying the statutory and regulatory standard discussed above. 80 FR at 14049. These 

deficiencies provided a basis (among other bases) for our proposed limited disapproval of ADEQ’s 

minor NSR program. As stated in our proposal, we found ADEQ’s general approach to meeting 40 CFR 

51.160(e) acceptable. However, we proposed a limited disapproval for three aspects of ADEQ’s minor 

NSR program under 40 CFR 51.160(e): the adequacy of ADEQ’s NSR exemption thresholds for 

nonattainment areas; certain exemptions for agricultural and fuel burning equipment; and the lack of 

any basis for the PM2.5 NSR exemption threshold in any areas under ADEQ’s jurisdiction. None of the 

comments on our proposal addressed our proposed limited disapprovals related to agricultural and 

fuel burning equipment exemptions or the missing explanation in the submittal for the PM2.5 NSR 

exemption threshold. As such, we continue to determine that these two issues warrant a limited 

disapproval, and further consider ADEQ’s comments as they apply to the basis provided for ADEQ’s 

NSR exemption thresholds for pollutants in nonattainment areas.7

ADEQ’s comments focus largely on the argument that expanding its minor NSR program to cover even 

smaller sources (i.e., sources with emissions of approximately 1⁄4 of the PSD significant emission rates) 

would result in diminishing returns on emission reductions. ADEQ argues that while more emissions 

would be regulated under such an approach, in some instances, this would result in significantly more 

stationary sources becoming subject to the program. In the case of VOC, for example, the percentage 

of all stationary sources regulated would approximately double from 8% to 16%. ADEQ appears to 

reason that while ADEQ would be able to regulate more emissions with such a lower threshold, the 

types of projects brought into the program would be smaller and less likely to be regulated in a way to 

achieve useful emission reductions. However, as discussed above, our determination of whether a 

 7 We note that the reasoning EPA provides in these responses to comments concerning permitting exemption thresholds in 

nonattainment areas would apply equally to our review of the basis for NSR exemption thresholds for PM2.5 in 

nonattainment areas.
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minor NSR program is sufficient to meet CAA SIP requirements is based on whether the State has 

provided an adequate basis that the exempt emissions do not need to be reviewed to ensure 

attainment and maintenance of the NAAQS in the particular geographic areas covered by the program

because they are inconsequential to attainment or maintenance, considering the particular air quality 

concerns in such areas. The information provided by ADEQ to date, including the amount of sources 

regulated as compared with the volume of emissions per such source, does not demonstrate that the 

adopted thresholds are those necessary to assure attainment and maintenance of the NAAQS. For 

example, if an area happens to have a large volume of sources in a particular source category that are 

typically minor sources but emit the pollutants that contribute to nonattainment, then regulation of 

those sources may be necessary to assure attainment and maintenance of the NAAQS in that area. The 

thresholds established in the Tribal NSR Rule exempted around 1 percent of total emissions, while 

exempting from 42 percent to 76 percent of sources, depending on the pollutant. 76 FR at 38758.

We recognize that the reference that EPA made in its proposed action to ADEQ’s submittal not 

providing a clear basis for concluding that its NSR exemption thresholds would ensure that a “sufficient 

percentage of minor sources” would be subject to review in nonattainment areas, rather than referring 

to a “sufficient percentage of minor source emissions,” was imprecise and may have led to confusion 

about the nature of EPA’s concern. As such, we are clarifying that our disapproval is related to ensuring 

that ADEQ’s NSR program exempts from review only those sources with emissions that do not pose a 

threat to attainment and maintenance of the NAAQS because they are inconsequential to attainment 

or maintenance. The particular percentage of stationary sources that are being regulated would 

generally not be an adequate basis under 40 CFR 51.160(e) for determining the sizes and types of 

stationary sources that will be subject to NSR review as necessary to ensure compliance with CAA 

section 110(a)(2) and 40 CFR 51.160(a) and (b). As noted, the Tribal NSR Rule exempted as many as 76 

percent of the sources of a pollutant, but required review of about 99% of total emissions. 76 FR at 

38758. In this case, ADEQ has not shown that the emissions exempt from its NSR program will not 

threaten attainment and maintenance of the NAAQS in its nonattainment areas. Accordingly, after 

consideration of ADEQ’s comments, we continue to find that a limited disapproval of ADEQ’s program 

under 40 CFR 51.160(e), as it pertains to the NSR exemption threshold for nonattainment areas, is 

necessary. 

As stated in our proposal, in addressing this deficiency, ADEQ does not necessarily have to consider 

overall lower permitting exemption thresholds in nonattainment areas, see 80 FR 14049 n. 13, 

although, as noted, the Tribal NSR Rule established lower thresholds for nonattainment areas. 76 FR at 

38758. For example, ADEQ could provide further analysis to demonstrate that the adopted thresholds 

are protective of the NAAQS in nonattainment areas, or ADEQ could consider a different approach, 

such as requiring minor sources in nonattainment areas subject to a pre-existing SIP requirement for 

the nonattainment pollutant, or its precursors, to be subject to review under ADEQ’s registration 

program. In addressing this limited disapproval issue, we recommend that ADEQ focus its 

consideration on the contribution that emissions from minor stationary sources with emissions below 

its currently adopted permitting exemption thresholds are expected to make with respect to 

attainment and maintenance of the NAAQS in nonattainment areas. 
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In addition, we wish to clarify that while EPA’s proposed rulemaking for the Tribal NSR program 

discussed cost-effectiveness and attempted to strike a “balance between environmental protection 

and economic growth,” it also recognized the need for exemption thresholds to ensure “that sources 

with emissions below the proposed minor NSR thresholds will be inconsequential to attainment and 

maintenance of the NAAQS.” 71 FR at 48703. See also 76 FR at 38758. EPA recognized the overarching 

need for standards stringent enough to ensure NAAQS protection, and agreed to “consider changing 

the minor NSR thresholds as appropriate” to ensure that they are sufficiently protective. 76 FR at 

38759. Thus, cost-effectiveness is not a relevant criterion for determining whether a minor NSR 

program’s exemption thresholds will assure attainment and maintenance of the NAAQS, and the test is 

not whether the benefits of the program outweigh the burdens of regulation, but whether the state’s 

program meets the requirement in CAA section 110(a)(2)(C) to “assure that national ambient air 

quality standards are achieved.”

Minor Sources in Nonattainment Areas

Comment 3:

(Commenters: SRP and ADEQ)

SRP and ADEQ state that EPA may not substitute its policy preferences for ADEQ’s in proposing to 

disapprove ADEQ’s minor NSR program with respect to nonattainment areas. There are no regulatory 

provisions or CAA statutory provisions that specify that a State must regulate a "sufficient percentage" 

of minor sources in nonattainment areas. EPA's objection appears to be based on its own policy 

preferences, and EPA simply lacks authority to substitute its preferences for those of the State. EPA

points to no flaws in the reasoning behind the analysis, nor does EPA provide an alternative analysis 

demonstrating that modifications or construction of minor sources of a certain size or type have 

caused air quality concerns within ADEQ's jurisdiction. 

Further, each state, region, and control area encounters unique circumstances that contribute to air 

quality issues, as well as the strategies necessary to comply with the requirements of the Clean Air Act. 

At page 14049 n. 12 of the proposal, which accompanied a generalized comparison to other states, EPA 

referenced threshold levels for Sacramento, California. It is erroneous for EPA to compare Arizona’s 

minor NSR program with that of California, due to the extraordinary severity of the nonattainment 

problems in California. EPA’s implication that ADEQ should create a minor source NSR program that 

looks and functions like other states, and particularly California, is an improper basis for disapproval.

ADEQ also asserts that EPA has advanced no reason for concluding that ADEQ’s analysis is any less valid 

for nonattainment areas than it is for attainment areas.

Response 3:

Contrary to the commenters’ assertions, our proposed limited disapproval of ADEQ’s program 

concerning the NSR exemption threshold for nonattainment areas was not based on an EPA policy 

preference to regulate “more” sources in nonattainment areas. As explained in detail in our response 

to comment 2, EPA’s proposed disapproval based on 40 CFR 51.160(e) stemmed in part from the lack 

of sufficient justification in ADEQ’s NSR submittal to support its chosen thresholds for coverage of the 
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minor NSR program in nonattainment areas as required by 40 CFR 51.160(e) and CAA section 110(a)(2).

It is the State’s obligation to demonstrate that emissions from sources exempt under its chosen NSR 

exemption threshold will not pose a threat to attainment or maintenance of the NAAQS. We found at 

the time of our proposal that ADEQ had not done so with respect to the NSR exemption thresholds in 

nonattainment areas, and we continue to find that this is the case.

8

Our March 18, 2015 proposed action made clear that ADEQ could consider various options for 

addressing this deficiency and we did not mandate that ADEQ adhere to a particular EPA policy choice 

in this regard. 80 FR at 14049 and n. 13. See also response to comment 2. EPA agrees with the 

commenters that ADEQ has the discretion to determine the types and sizes of sources that need to be 

regulated under its NSR program to attain and maintain the NAAQS. But ADEQ, like other States, must 

provide a reasoned basis for the scope of emissions (and stationary sources of such emissions) 

regulated under its program that demonstrates that exemption of such emissions from NSR review will 

not threaten the attainment and maintenance of the NAAQS in nonattainment areas. 

Air quality concerns in nonattainment areas differ from those in attainment areas and thus the 

measures necessary to attain and maintain the NAAQS may be more stringent in nonattainment areas 

than in attainment areas. When an area is already in nonattainment with a NAAQS for a particular 

pollutant, it is logical to conclude that relatively low levels of emissions increases of that 

nonattainment pollutant may well contribute to nonattainment and interfere with achievement of the 

NAAQS, while a source with the same level of emissions in an attainment area may pose little threat to 

maintaining the NAAQS. Thus, SIPs may need to provide greater or more detailed justification for 

exempting smaller sources of emissions from NSR review in nonattainment areas, depending on the 

particular air quality concerns in the area at issue. Indeed, as noted, EPA’s Tribal NSR Rule established

more stringent thresholds for minor NSR in nonattainment areas, in most cases at 50% of the 

thresholds for attainment areas. 76 FR 38758 (Table). 

ADEQ’s jurisdiction covers both attainment and nonattainment areas, and ADEQ’s analysis supporting 

its NSR exemption thresholds made no distinction between these types of areas nor did it provide 

additional information to support the thresholds in nonattainment areas under ADEQ’s jurisdiction. For 

example, ADEQ’s analysis indicated that it would exempt approximately 65% of CO emissions, 78% of 

SO2 emissions, and 40% of VOC emissions from review under its NSR program. By comparison, EPA’s 

analysis for the Tribal Minor NSR program, cited by ADEQ in its analysis, demonstrated that EPA 

anticipated exempting around 1% of stationary source emissions from review under NSR, based on

National Emissions Inventory data for all stationary point source emissions in both attainment and 

nonattainment areas. As such, ADEQ did not provide enough detail to demonstrate that NSR review of 

emissions from the exempted sources would not be necessary for attainment and maintenance of the 

NAAQS in nonattainment areas because sources below the thresholds would be “inconsequential to 

attainment or maintenance of the NAAQS.” 76 FR at 38758. Accordingly, we found that ADEQ had not 

 8 We addressed the comment concerning the reference in EPA’s proposal to regulation of a “sufficient percentage of minor 

sources” in our response to comment 2.
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provided an adequate basis under 40 CFR 51.160(e) for its NSR program exemption thresholds as they 

pertain to nonattainment areas. 

In the case of attainment areas, EPA is approving the basis provided by ADEQ for its selected NSR 

exemption thresholds. We find it reasonable to conclude, based on the information and analysis 

provided by ADEQ, that expanding the NSR program to cover more emissions in areas that are already 

attaining the NAAQS will ensure that those areas will continue to attain and maintain the NAAQS. We 

cannot reach the same conclusion for nonattainment areas where the minor sources in a particular 

nonattainment area may, in fact, significantly contribute to nonattainment in that area.9

The reference in our proposal to the approaches taken by other permitting programs, including a 

California agency, with respect to NSR exemption thresholds in nonattainment areas is not an 

indication that EPA believes that such approaches or thresholds are required for ADEQ, but simply 

information showing that it is common for agencies in nonattainment areas to find it necessary to 

regulate more emissions. In providing this information, EPA was not suggesting that there was a 

particular percentage of emissions that should be regulated, but that other nonattainment areas have 

found it necessary to exempt fewer emissions from their programs (including Maricopa County, 

Arizona, Colorado, and EPA’s Tribal Minor NSR rule, which were also referenced in our proposed 

action10). It was ADEQ’s lack of demonstration that its selected thresholds are adequate to ensure 

attainment and maintenance of the NAAQS in light of the specific air quality issues in the 

nonattainment areas under its jurisdiction that led to our proposed disapproval. 

In sum, EPA did not conclude that ADEQ’s NSR exemption thresholds are necessarily deficient, or 

suggest that some other agency’s threshold must be applied. EPA’s proposed limited disapproval for 

ADEQ’s NSR exemption thresholds for nonattainment areas under 40 CFR 51.160(e) relates only to the 

fact that ADEQ had not provided an adequate basis for the thresholds that were set for these areas. As 

discussed in response to comment 2, our final limited disapproval is also based on this finding.

Authority to Deny a “Proposed Final Permit” Satisfies NSR Requirements

Comment 4:

(Commenter: ADEQ)

ADEQ submitted comments related to EPA’s proposed limited disapproval of ADEQ’s NSR SIP submittal 

for its use of the term “proposed final permit.” ADEQ explains that the purpose of allowing sources to 

construct after issuance of a proposed final permit – the version of the permit that ADEQ forwards to 

EPA for review under the title V program for title V sources – is to ensure that Arizona's unitary permit 

 9 We acknowledge that ADEQ’s analysis explained that sources that contribute to noncompliance with the SO2 NAAQS are 

well-defined, large industrial sources already subject to the permitting program. However, ADEQ’s analysis did not provide 

information or details to support these statements or otherwise provide information sufficient to allow EPA to reach the 

conclusion that the permitting exemption thresholds selected by ADEQ exempt only those stationary sources with 

emissions that do not pose a threat to attainment and maintenance of the NAAQS in nonattainment areas.

10 There was a typographical error in our FR notice that referenced a “Table 3,” when there was not a Table 3 in the Federal 

Register notice. The notice should have referenced Table 3 of our TSD.
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program does not place restrictions on Arizona industries that they would not face in jurisdictions with 

binary permitting programs. Under a binary program, separate permits are issued to construct and 

operate, and only permits to operate are subject to EPA review under title V. Thus a source in a 

jurisdiction with a binary program ordinarily would have the authority to proceed with construction 

under a construction permit before EPA review of the title V permit or permit revision occurred.

ADEQ specifically takes issue with EPA’s proposed determination that the program does not provide 

ADEQ with clear authority to prevent construction or modification before it issues a final decision on 

the request for authority to construct as is required per 40 CFR 51.160(a) and (b). 80 Fed. Reg. at 

14048. ADEQ states that this objection is invalid for two reasons. 

First, 40 C.F.R. § 51.160(b) does not require a minor NSR program to include authority to prevent 

construction “before [an agency] issues a final decision.” It requires only that the program include 

procedures by which the agency “will prevent ... construction or modification.” The Arizona program 

manifestly includes such procedures: ADEQ can prevent construction of a source that threatens the 

NAAQS or control strategy by denying the permit application before a proposed final permit is issued. 

No more is required. Second, by “final” EPA appears to mean subject to administrative and judicial 

review. See 80 Fed. Reg. at 14053. EPA maintains that although ADEQ has issued guidance stating that 

it “will treat [a] proposed final permit as a final, appealable agency action," the rule itself is not 

sufficiently clear to be fully approved. 80 Fed. Reg. at 14048.

EPA, however, has mischaracterized ADEQ’s guidance. ADEQ did not state that it “will treat” proposed 

final permits” as appealable agency actions. Rather, the Department stated that it “must” do so. Under 

Arizona administrative law, an "appealable agency action" is defined as "an action that determines the 

legal rights, duties or privileges of a party." A.RS. § 41-1092(3). Because a proposed final permit or 

permit revision under the revised rules determines the applicant's right to construct, it must be treated 

as an appealable agency action separate from the issuance of the final permit or permit revision. ADEQ 

must therefore issue a notice of appealable agency action under A.R.S § 41-1092.03 for both the 

proposed final permit or permit revision, as well as the final permit or permit revision.

ADEQ states that there is no ambiguity under Arizona law (which mirrors the administrative law of 

most states). Under the clear terms of ADEQ’s regulations, a proposed final permit confers a right to 

construct and is therefore appealable. 

Response 4:

EPA appreciates ADEQ’s comments concerning the question of whether ADEQ’s NSR program provides 

for the issuance of a final NSR decision prior to sources being allowed to begin construction. Our 

proposed action on ADEQ’s NSR SIP submittal stated that certain sources were allowed to begin 

construction upon issuance of a proposed final permit, and that we believed that ADEQ’s regulations 

were ambiguous as to whether issuance of a “proposed final permit” was a final NSR decision. As a 

result, we proposed to find that ADEQ’s NSR SIP submittal did not satisfy several related CAA 

requirements, and those deficiencies provided some of the bases for our proposed limited disapproval 

of ADEQ’s PSD program, NA-NSR program, and minor NSR program.
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EPA continues to believe that the CAA and its implementing regulations require that PSD and NA-NSR 

programs must provide for the issuance of final NSR permit decisions imposing permit conditions 

necessary to ensure compliance with the applicable NSR program requirements before sources subject 

to those programs may begin construction. We also interpret the CAA to require that PSD programs 

provide an opportunity for judicial review of PSD permit decisions. See generally CAA sections 

110(a)(2)(C), 165, 172(c)(5), 173; 40 CFR 51.165(a)(2), 51.166(a)(7)(iii), 166(q)(2)(vii).11

The CAA and its implementing regulations also require that minor NSR programs provide for legally 

enforceable procedures including means by which the Agency responsible for final decisionmaking on 

an application for approval to construct or modify has authority to prevent such construction or 

modification if such construction or modification will result in a violation of applicable portions of the 

control strategy or will interfere with the attainment or maintenance of a national ambient air quality 

standard (NAAQS). CAA section 110(a)(2)(C), 40 CFR 51.160(a)-(b). We continue to believe that 

decisionmaking authorities must make final NSR decisions for minor sources, as well as major sources, 

subject to their NSR program prior to allowing sources to begin construction in order to satisfy this 

requirement that the plan provide for such “legally enforceable procedures.”12

EPA acknowledges the interpretation that ADEQ recently provided to clarify that ADEQ must treat 

“proposed final permits” as “appealable agency actions,” which are defined under Arizona law as 

actions that “determine[] the legal rights, duties or privileges of a party” pursuant to A.R.S. section 41-

1092(3). ADEQ Memorandum – Proposed Final Permits to Be Treated as Appealable Agency Actions, 

dated February 10, 2015. ADEQ also provided additional clarifications after the end of the public 

comment period, specifically stating that “[p]roposed final permits are enforceable at the time that the 

permits are issued.”13 After further review of this issue and consideration of ADEQ’s comments and 

interpretation of its regulations, and in reliance on ADEQ’s stated interpretation of its regulations, we 

have determined that “proposed final permits” constitute final, binding, and enforceable NSR decisions 

by ADEQ that are issued before sources may begin construction and which are immediately subject to 

review. 

We therefore conclude that ADEQ’s NSR program provides, in all instances, for the issuance of a final 

NSR decision prior to sources being allowed to begin construction, thus this issue no longer provides a 

basis for our limited disapproval of the ADEQ NSR SIP submittal. Specifically, we agree that: (1) ADEQ’s 

 11 The notice for our proposed action noted discussed the fact that we interpret the CAA to require an opportunity for 

judicial review of a decision to grant or deny a PSD permit, whether issued by EPA or by a State under a SIP-approved or 

delegated PSD program. See 80 FR 14053. 12 We agree that ADEQ has authority to decline to issue a proposed final permit for a particular source if it finds that the 

emissions from such source would result in a violation of applicable portions of the control strategy or would interfere with

the attainment or maintenance of the NAAQS. However, in cases where a permit requirement would be needed to ensure 

compliance with the NAAQS for a particular source, if such a permit decision were not final, binding and enforceable at the 

time construction of the source was authorized, there would not be a legally enforceable procedure in place to prevent 

construction of that source in a manner that could violate the NAAQS as required by 40 CFR 51.160. 13 See June 8, 2015 email “Clarification of ADEQ’s Comments on EPA’s Proposed Action” from Eric C. Massey, Air Quality 

Division Director at ADEQ to Lisa Beckham, Air Permits Office, EPA Region 9.
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NSR program provides ADEQ with clear authority to prevent construction or modification before it 

issues a final decision on the request for authority to construct as required by 40 CFR 51.160(a) and (b); 

(2) ADEQ’s PSD and NA-NSR programs do not allow a source to begin construction prior to issuance of 

a final PSD or NA-NSR permit; and (3) ADEQ’s PSD program satisfies the CAA requirement for an 

opportunity for judicial review of PSD permit decisions. We are also including the clarifying 

memorandum from ADEQ dated February 10, 2015 as additional material in our final rule.

However, we continue to recommend that ADEQ revise its regulations to clarify that a proposed final 

permit is a final, enforceable, and appealable NSR permit decision in order to minimize confusion 

among the public and the regulated community. We reiterate that such a revision is not a requirement 

for approval of ADEQ’s NSR program into the SIP.

Sufficiency of ADEQ’s Minor NSR Requirements to Protect the NAAQS

Comment 5:

(Commenters: ADEQ and SRP)

ADEQ disagrees with EPA’s proposed limited disapproval of ADEQ’s program under 40 CFR 51.160(a)(2) 

and (b)(2) because rule R18-2-334 does not require ADEQ to evaluate whether the project under 

review will interfere with attainment or maintenance of the NAAQS in all cases, and instead allows 

sources to apply reasonably available control technology (RACT) in lieu of such an evaluation. ADEQ 

also takes issue with EPA’s determination that R18-2-334(E) allows for too great of Director’s discretion 

when determining when to require a NAAQS analysis. ADEQ believes this objection is fundamentally at 

odds with EPA’s own approach to air quality impact analysis (AQIA) in the Tribal Minor NSR Rule. The 

tribal rule initially imposes a case-by-case control technology requirement, but gives the “reviewing 

authority” (which may be EPA or a tribe with delegated authority) discretion to conduct an AQIA. 40 

CFR 51.154(c) and (d). ADEQ also cites to EPA’s response to comments for the Tribal Minor NSR Rule 

where EPA indicated that reviewing authorities implementing the Tribal Minor NSR Rule should be 

allowed the discretion to determine when an AQIA might be needed from the applicant. See 76 FR 

38761. Further, ADEQ argues that ADEQ’s rule is actually stricter and confers less discretion than EPA’s 

Tribal Minor NSR Rule. ADEQ must consider the source’s emission rates, location of emission units 

within the facility and their proximity to ambient air, the terrain in which the source is or will be 

located, the source type, the location and emissions of nearby sources, and background concentration 

of regulated minor NSR pollutants. By comparison, the criteria in EPA’s Tribal Minor NSR Rule states 

that if the reviewing authority has reason to be concerned that the construction of your minor source 

or modification would cause or contribute to a NAAQS or PSD violation, it may require the source to 

conduct and submit an AQIA. (emphasis added). ADEQ believes that this comparison demonstrates 

that ADEQ’s discretion is far from being “too great;” ADEQ’s discretion under R18-2-334(E) is minimal.

Finally, ADEQ disagrees with EPA’s determination that R18-2-334(C)(1)(a)-(b) “appears to allow sources 

with lower levels of emissions to avoid both substantive NAAQS review and RACT requirements” and 

that the state’s minor NSR Program therefore fails to ensure “that all sources subject to review under 

its NSR program will not interfere with attainment or maintenance of the NAAQS.” This objection is 

incorrect for two reasons. First, R18-2-334(C)(1)(a)-(c) represents ADEQ’s reasonable judgment that 
Response to Comments

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the imposition of RACT on units with low emissions (20 percent of the source threshold) within a 

source otherwise subject to RACT is not a cost-effective means of protecting the NAAQS. Second, this 

provision does not, as EPA contends, allow sources to avoid substantive NAAQS review. This provision 

clearly applies solely to sources that elect to comply with minor NSR through installation of RACT. 

These sources remain subject to the obligation to conduct an AQIA on the Director’s request under 

R18-2-334(E), and there is nothing in the rule to suggest that emissions from units below the R18-2-

334(C)(1)(a)-(b) thresholds would be excluded from the AQIA.

SRP also disagrees with EPA’s proposed disapproval based on EPA’s finding that the Director's 

discretion under R-18-2-334(E) was too great, and asserts that EPA’s proposed action conflicts with US 

EPA's policy on approving director discretion provisions. SRP argues that the Director’s discretion in 

this regard is sufficiently specific in identifying when it applies and what criteria are to be applied and 

that therefore the relevant provisions are fully approvable into the Arizona SIP.

Response 5: 

Upon review of ADEQ’s comments, including clarifications regarding how the provisions of R18-2-

334(E) apply, and in reliance on ADEQ’s stated interpretation of its regulations, we no longer find that 

ADEQ’s minor NSR program does not satisfy 40 CFR 51.160(a)(2) and (b)(2) based on the view that rule 

R18-2-334 does not require ADEQ to evaluate whether all sources subject to review under that rule

may interfere with attainment or maintenance of the NAAQS.

14 After the close of the public comment 

period, ADEQ provided additional clarifications, stating that it interprets R18-2-334 to “require[] ADEQ 

to consider the air quality impacts of a project, using the criteria established in R18-2-334(E)(1) through 

(6), in each instance where the applicant has not submitted an AQIA under R18-2-334(C)(2).”15 ADEQ 

has explained that it interprets R18-2-334 to require ADEQ to consider, for all sources subject to R18-2-

334, whether there is reason to believe that the source could interfere with attainment or 

maintenance of the NAAQS. Some sources will comply with this requirement by submitting an AQIA 

under R18-2-334(C)(2). All other sources will be reviewed by ADEQ using the criteria in R18-2-334(E), 

and those criteria will be used to determine whether a more formal AQIA is necessary. That is, ADEQ 

does not have discretion to determine in which instances it will or won’t apply the criteria in R18-2-

334(E)(1) through (6); instead, ADEQ interprets its regulations to require that ADEQ apply such criteria 

for all sources subject to R18-2-334 where the applicant has not submitted an AQIA. Accordingly, this 

issue does not provide a basis for our final limited disapproval.

We would also like to clarify that our proposed limited disapproval was not specifically related to 

ADEQ’s choice to apply RACT for some sources subject to R18-2-334 while allowing certain smaller 

sources subject to the rule to avoid RACT. Rather, our proposed disapproval action related only to what 

we understood to be the potential for sources subject to R18-2-334 to apply RACT (or to proceed 

without applying RACT for certain sources with lower emissions) in lieu of any review by ADEQ of the 

source’s potential impacts on the NAAQS under the ADEQ NSR program. As discussed immediately 

 14 EPA’s proposal inadvertently referred to R18-2-334(G) instead of R18-2-334(E) when describing this issue. 15 See June 8, 2015 email “Clarification of ADEQ’s Comments on EPA’s Proposed Action” from Eric C. Massey, Air Quality 

Division Director at ADEQ to Lisa Beckham, Air Permits Office, EPA Region 9.
Response to Comments

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above, this is no longer a concern as ADEQ has explained that it must review all sources subject to R18-

2-334 to consider whether the source could interfere with attainment or maintenance of the NAAQS.

Given our revised determination on this issue, it is not necessary to address all the arguments made by 

SRP concerning this issue, but we note that we agree with SRP (and ADEQ) that the criteria ADEQ will 

be applying when making its determination under R18-2-334(E) do not afford undue discretion to the 

Director. 

Imposition of a Federal Implementation Plan or Sanctions 

Comment 6: 

(Commenter: SRP)

One commenter takes issue with EPA’s statements that finalizing its proposed limited disapproval 

would trigger an obligation for EPA to promulgate a Federal Implementation Plan (FIP) and impose CAA 

sanctions if ADEQ does not correct the alleged deficiencies within 18 to 24 months. The commenter 

asserts that this contradicts the statutory limitations on EPA's SIP-action authority under the CAA.

Section 110(c)(1) provides the EPA the authority to promulgate a FIP in only two circumstances: 1) the 

State failed to make a required SIP submission, or 2) the Administrator disapproves a SIP submission in 

whole or part. Section 179(a) contains similar conditions for imposing sanctions in nonattainment 

areas. The commenter claims that EPA interprets its authority to impose a FIP or sanctions only when 

the disapproval relates to a mandatory SIP submission. In support of this assertion, the commenter 

cites to one action from EPA Region 6 that disapproved elements of the Texas Commission of 

Environmental Quality's (TCEQ's) major NSR rule to address the 2002 NSR changes ("[t]he provisions in 

these submittals ...were not submitted to meet a mandatory requirement of the Act. Therefore, this 

final action to disapprove ...the State submittals does not trigger a sanction or Federal Implementation 

Plan clock."). The commenter concludes that such an interpretations of Section 110(c)(1) and Section 

179(a) are reasonable because EPA would otherwise, for example, be required to promulgate a FIP for 

disapproving a State's request to include odor provisions in its SIP that are unrelated to NAAQS 

compliance.

The commenter further states that ADEQ's current SIP contains fully-approved, minor NSR and major 

NSR permitting programs. As such, the State's requested SIP revisions addressed in EPA’s proposed 

action are not mandatory. The commenter further argues that EPA referenced no information 

suggesting that it made a formal call for plan revision as required by Section 110(k)(5) of the CAA 

related to its proposed limited disapproval of ADEQ’s NSR SIP submittal. As such, in general, Arizona is 

not under a mandatory duty to revise its existing SIP with regards to its NSR programs. The commenter 

argues that it is inappropriate for EPA to replace a fully approved-SIP with a program that it alleges 

does not fully satisfy CAA requirements by using an approach that triggers the FIP clock and potentially 

imposes sanctions. ADEQ could withdraw the requested SIP submission and face no threat of an EPA 

FIP or sanctions.
Response to Comments

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Response 6:

EPA disagrees with the commenter’s statement that EPA's limited disapproval in this action does not

trigger a FIP clock or potential sanctions, and disagrees that EPA’s action is inappropriate in light of 

this result. 

EPA continues to believe that limited disapproval of ADEQ’s NSR SIP submittal triggers an obligation to 

promulgate a FIP unless ADEQ corrects the identified deficiencies and EPA approves the related SIP 

revisions within 2 years, and that sanctions would be triggered by EPA’s limited disapproval of ADEQ’s 

NA-NSR program revisions based on deficiencies related to CAA title I, Part D requirements for 

nonattainment areas if ADEQ fails to remedy the identified deficiencies so that EPA can approve the 

revisions into the SIP before the sanctions apply. As stated in the notice for our proposal, we intend to 

work with ADEQ to remedy these deficiencies in a timely manner. Importantly, we note that EPA’s 

other option would have been a full disapproval of ADEQ’s NSR SIP submittal, which would have 

required ADEQ to continue to implement the outdated rules in its SIP while also implementing its 

newer rules under State law. This would require ADEQ and permit applicants to continue to implement 

and comply with two redundant and sometimes inconsistent sets of NSR rules, contrary to ADEQ’s 

request to update its SIP to incorporate its newer rules and remove its older, outdated rules.

Pursuant to section 110(c)(1) of the CAA, EPA must promulgate a FIP within two years after our final 

limited disapproval of ADEQ’s NSR SIP submittal, unless ADEQ adequately corrects the identified 

deficiencies and EPA approves the corrected program into the Arizona SIP before that time. The 

commenter argues that the FIP clock applies only when a disapproval relates to a mandatory SIP 

submission, and asserts that the submitted revisions are not mandatory because ADEQ's existing SIP 

contains fully-approved minor and major NSR programs, and the revisions were not developed in 

response to a SIP call under CAA section 110(k)(5). The EPA disagrees with the commenter’s argument.

Even if EPA has not issued a SIP call under CAA section 110(k)(5),16 a FIP is generally required under 

CAA section 110(c)(1) when EPA disapproves a plan submission, unless the State adequately corrects 

the basis for the disapproval and EPA approves a corrected SIP submittal in a timely manner, or EPA 

determines that an existing plan is in place that meets the relevant CAA requirements. See AIR v. EPA, 

686 F.3d 668, 675-76 (9th Cir. 2012). We note that NSR programs consistent with CAA requirements are 

required elements of a SIP. CAA §§ 110(a)(2)(C), 161, 165, 172(c)(5), 173; 40 CFR 51.160-51.166. 

In this case, EPA cannot rely on provisions in the existing Arizona SIP to adequately address the 

deficiencies with the ADEQ NSR SIP submittal that we identified in our proposed rule and which form 

the basis for our final limited disapproval. ADEQ must address these deficiencies in a timely manner in 

order to avoid the requirement for EPA to promulgate a FIP. As we made clear in the notice for our 

proposed action,17 ADEQ’s NSR SIP submittal included the removal of most of ADEQ’s existing NSR 

 16 There is no existing SIP call under CAA section 110(k)(5) that specifically pertains to the deficiencies with ADEQ’s NSR 

program.

17 See 80 FR at 14046-14047. 
Response to Comments

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program elements from the Arizona SIP.18 Upon our final action19, there will not be an “existing plan” 

that could potentially satisfy the specific CAA NSR requirements that EPA has determined are not 

satisfied in ADEQ’s NSR SIP submittal.20 In general, EPA’s role in reviewing SIP submittals, including the 

ADEQ NSR SIP submittal, is to defer to the State’s choices as to how to implement CAA requirements 

provided those choices are consistent with the pertinent CAA requirements, whether or not a program 

submittal is considered “mandatory.” EPA’s limited approval/limited disapproval action on ADEQ’s NSR 

SIP submittal, including ADEQ’s request to remove old and largely outdated NSR provisions from the 

Arizona SIP, allows us to approve into the SIP the State’s choice to adopt and implement its updated 

and strengthened NSR program while giving ADEQ time to remedy certain deficiencies that cause us 

not to grant full approval of the submittal. Furthermore, even if one assumed arguendo that these 

older Arizona NSR provisions were not being removed from the Arizona SIP, the commenter has not 

explained how the old NSR provisions would, in fact, meet the NSR requirements for which EPA has 

found specific deficiencies in ADEQ’s updated NSR program.21

Similarly, for deficiencies related to CAA title I, Part D requirements for nonattainment areas, final 

limited disapproval of ADEQ’s NSR SIP submission will result in the application of sanctions under CAA 

section 179 unless the deficiencies have been adequately corrected before the sanctions apply.

 18 See October 29, 2012 ADEQ submittal at 4 and Table 2-1; see also ADEQ’s February 23, 2015 supplemental submittal at 3-

7.

19 We note that EPA’s limited approval/limited disapproval of ADEQ’s NSR SIP submission allows ADEQ to use its updated 

NSR rules, to the extent EPA is granting limited approval in this action, to carry out the NSR program. Continuing to leave 

old and outdated Arizona NSR SIP elements in place would not be consistent with ADEQ’s SIP submission and request to 

EPA, and would require ADEQ and permit applicants to implement and comply with two redundant and sometimes 

inconsistent sets of NSR rules. Whether ADEQ could withdraw its ADEQ NSR SIP submittal and what consequences would 

ensue is not relevant; ADEQ has not done so.

20 The commenter asserts that when EPA Region 6 disapproved elements of the Texas Commission of Environmental 

Quality's (TCEQ's) major NSR rule, EPA found that the provisions in the submittals were not submitted to meet a mandatory 

requirement of the Act and thus noted that its final action to disapprove the State submittals did not trigger a sanction or 

FIP clock. The TCEQ example is inapposite, however, because our action on the ADEQ NSR SIP submittal approves rules with 

identified deficiencies into the SIP where the Region 6 action did not. Region 6 found the deficiencies in the TCEQ 

submission to be separable and issued partial disapprovals for them, resulting in a SIP that did not contain the deficiencies. 

In that situation, whether the deficiencies that were disapproved were contained in “mandatory” SIP submissions was 

relevant because if they were “mandatory” then disapproval likely would have resulted in TCEQ needing to submit another 

plan revision to replace the disapproved plan elements. But because the deficiencies were found to be separable and 

contained in plan elements that were not mandatory, EPA issued a partial disapproval of those elements, keeping the 

deficiencies out of the approved SIP and with TCEQ under no obligation to submit another SIP revision because the 

disapproved plan elements were not “mandatory.” In contrast, the provisions including the identified deficiencies in the 

ADEQ NSR SIP submittal are integrated parts of the submittal and are being approved into the SIP as part of our limited 

approval/limited disapproval action, so whether the ADEQ plan revisions containing the deficiencies are “mandatory” is not 

relevant and is not a basis to avoid a FIP duty or sanctions.

21 ADEQ noted in its submittal that its existing SIP-approved program did not include the PM10 increments, the NO2

increments, or updates related to the “WEPCO” rule for determining when a project is a modification at an electric 

generating unit. In addition, ADEQ stated that a basis for its revisions to its minor NSR program was to correct the 

deficiency that its program lacked explicit procedures designed “to assure that national ambient air quality standards are 

achieved,” as required by section 110(a)(2)(C) of the Act. See Appendix A of ADEQ’s October 29, 2012 SIP submittal at 1546 

and 1547.
Response to Comments

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June 2015

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As with its arguments concerning the FIP clock, the commenter argues that CAA sanctions apply only 

when a disapproval relates to a mandatory SIP submission, and asserts that the submitted revisions are 

not mandatory because ADEQ's existing SIP contains fully-approved NSR permitting programs, and the 

revisions were not developed in response to a SIP call under CAA section 110(k)(5). The EPA again 

disagrees with the commenter’s argument.

Even if EPA has not issued a SIP call under CAA section 110(k)(5), sanctions generally will apply under 

CAA section 179 when EPA disapproves a plan submission based on plan deficiencies that relate to title 

I, Part D requirements, unless ADEQ adequately corrects those deficiencies and EPA takes action to 

approve a corrected plan submittal before the sanctions apply, or EPA determines that the existing 

plan meets the applicable Part D requirements. See 40 CFR 52.31. A NA-NSR program that meets CAA 

requirements is a required element of a SIP. CAA §§ 110(a)(2)(C), 172(c)(5), 173; 40 CFR 51.165.

As discussed above, ADEQ’s NSR SIP submittal included the removal of most of ADEQ’s existing NSR 

program elements from the Arizona SIP, so upon EPA’s final action there will not be older NA-NSR SIP 

provisions that could potentially meet the CAA NA-NSR requirements that EPA has determined are not 

satisfied in the NA-NSR program in ADEQ’s NSR SIP submittal. EPA’s limited approval/limited 

disapproval action on ADEQ’s NSR SIP submittal, including ADEQ’s request to remove old and largely 

outdated NSR provisions from the Arizona SIP, allows us to approve into the SIP the State’s choice to 

adopt and implement its updated and strengthened NA-NSR program while giving ADEQ time to 

remedy certain deficiencies that cause us not to grant full approval of the submittal. Furthermore, 

even if one assumed arguendo that these older Arizona NA-NSR provisions were not being removed 

from the Arizona SIP per ADEQ’s request, the commenter has not explained how the old NA-NSR 

provisions would, in fact, meet the specific NA-NSR requirements for which EPA has found deficiencies 

with ADEQ’s updated NA-NSR program. For example, ADEQ’s old SIP-approved program did not include 

NOX as a precursor to ozone.

We note that EPA is also finalizing a partial disapproval – rather than limited approval/limited 

disapproval -- for a separable ADEQ NSR program provision that is analogous to a previous federal NSR 

provision that a federal Court determined is not a permissible component of PSD programs– the PM2.5 

significant monitoring concentration (SMC). As there is no deficiency related to this issue in the 

approved plan following our partial disapproval, neither a FIP requirement nor sanctions will result 

from this partial disapproval action. 

EPA’s limited disapproval action is based on program elements in ADEQ’s NSR SIP submittal that do not 

meet CAA requirements and are not satisfied by the existing Arizona SIP provisions that remain in place 

following our final action.22 We wish to clarify that all of the bases for our final limited disapproval 

action on the ADEQ NSR SIP submittal must be adequately addressed in a timely manner in order to 

avoid a requirement for a FIP or, for Part D deficiencies, the application of sanctions. 

 22 In addition, ADEQ’s NSR SIP submittal did not address the regulation of greenhouse gases (GHGs) under the PSD program. 

As discussed in the notice for our proposed action on ADEQ’s NSR SIP submittal, a FIP is currently in place in Arizona to 

address PSD requirements for GHGs. See 80 FR at 14054 n.17.
Response to Comments

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Finally, our final limited disapproval also addresses some SIP elements or provisions that are not 

required (e.g., deficiencies concerning optional PAL provisions), but were not separable from ADEQ’s 

NSR SIP submittal as they were an integrated part of that submittal. Because we are approving these 

provisions into the SIP, EPA will be obligated to implement a FIP and/or sanctions will apply (as 

applicable) for such optional program elements that remain in the SIP if the deficiencies in those 

elements are not corrected to ensure consistency with CAA requirements. 

On-The-Record Severability Determination for Limited Approval, Limited Disapproval

Comment 7:

(Commenter: SRP) 

SRP states that to proceed using the limited approval, limited disapproval mechanism, EPA must make 

an on-the-record determination that the disapproved elements are not severable from the approved 

elements. EPA has not made this finding or provided this explanation in its proposed notice. 

Response 7:

EPA disagrees with this comment. The commenter cites no authority for this unsupported proposition. 

Under CAA sections 110(k)(3) and 301(a) and EPA’s long-standing guidance, limited approval and 

partial approval are alternatives to full approval or full disapproval of a complete plan submission. 

Limited approval may be appropriate where a plan submittal contains some provisions that meet 

applicable CAA requirements and other provisions that do not, and the provisions are not separable. 

Partial approval may be used where a separable portion of a plan submittal meets all applicable CAA 

requirements. EPA has discretion under the CAA to choose an appropriate approval or disapproval 

mechanism for a plan submission, and there is no required “finding” that the provisions are not 

separable for a proposed or final limited approval or limited disapproval SIP action. See Processing of 

State Implementation Plan (SIP) Revisions, EPA Memorandum from John Calcagni, Director, Air Quality 

Management Division, OAQPS, to Air Division Directors, EPA Regional Offices I–X, September 7, 1992 

(www.epa.gov/ttn/caaa/t1/memoranda/siproc.pdf).

Nevertheless, in general, we believe that, with the exception of the partial disapproval of the PM2.5 

significant monitoring concentration that we are finalizing, the components of ADEQ’s NSR SIP 

submittal are interrelated and not separable from the submittal as a whole and therefore not 

appropriate for partial disapproval. ADEQ has not provided us with any basis to conclude that 

particular aspects of its NSR SIP submittal for which we proposed limited disapproval are not integral 

or interrelated parts of the submittal or are otherwise separable and appropriate for partial 

disapproval. Further, the commenter has not demonstrated that any portion of the ADEQ NSR SIP 

submittal for which we proposed limited disapproval is, in fact, separable and appropriate for partial 

disapproval rather than limited disapproval. 

ADEQ’s Definition of “Stationary Source”

Comment 8:

(Commenter: SRP)
Response to Comments

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June 2015

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One commenter states that EPA’s assertion that ADEQ may not exclude certain pollutant-emitting 

activities from PSD misinterprets EPA's regulations. The commenter points to 40 CFR §51.160(e) and 

states that a State may exclude activities that it anticipates will have negligible or insignificant 

environmental impacts from either the major or minor NSR permit programs. This regulatory approach 

makes sense because it allows for a practical integration of the multiple preconstruction requirements. 

There is no basis for requiring a State to regulate activities with the more stringent requirements 

contained in the PSD or NA NSR program when those activities fall below the levels of concern 

established for the minor NSR program.

Response 8: 

The regulations governing PSD and NA-NSR SIP programs contain the fundamental requirement that 

such programs adopt a specified definition for “stationary source.” 40 CFR 51.165(a)(1)(i), 51.166(b)(5). 

The regulations require the use of the prescribed definition, and state that deviations from the 

specified wording will be approved only if “the State specifically demonstrates that the submitted 

definition is “more stringent, or at least as stringent, in all respects” as the prescribed definition. 40 

CFR 51.165(a)(1), 51.166(b). As explained in reference to the NA-NSR program in our March 18, 2015 

proposal:

ADEQ must demonstrate that its definition of stationary source is at least as stringent as the 

federal definition at 51.165(a)(1)(i) in all respects. 

See 80 FR at 14056; see also 80 FR at 14054 for the PSD program. The commenter has not addressed 

how ADEQ’s definition would be at least as stringent as the definitions in 51.165(a)(1)(i) and 

51.166(b)(5) in light of the exemption language referenced in our proposal, see 80 FR at 14054, nor has 

ADEQ provided the necessary demonstration that its definition of stationary source is at least as 

stringent as the definition of “stationary source” under the federal PSD and NA-NSR programs. Indeed, 

ADEQ’s comments did not address this basis of our proposed limited disapproval. We continue to find 

that this issue provides a basis for limited disapproval of ADEQ’s NSR SIP submittal.

We do not interpret 40 CFR 51.160(e) as allowing states to develop less stringent definitions for these 

programs without the necessary demonstration that the submitted definition is “more stringent, or at 

least as stringent, in all respects” as the prescribed definition as required by 40 CFR 51.165(a)(1) and 

51.166(b). Section 51.160(e) does not contain any language giving states the discretion to exclude any 

type of source from the more specific major source permitting requirements in section 51.165 and 

51.166. Section 51.160(e) does not say anything about sources that have “negligible or insignificant

environmental impacts.” This section simply requires that a state plan identify the types and sizes of 

stationary sources that are covered by the “legally enforceable procedures” required under section 

51.160(a) to review construction or modification of stationary sources. Sections 51.165 and 51.166 

provide more detailed procedures that must apply to major stationary sources. These more specific 

provisions in sections 51.165 and 51.166 make clear that those procedures must cover the type and 

size of source covered by the definitions at 40 CFR 51.165(a)(1)(i) and 51.166(b)(5).
Response to Comments

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ADEQ’s “Projected Actual Emissions” Definition and Malfunction Emissions

Comment 9:

(Commenter: SRP)

One commenter takes issue with our proposed limited disapproval of ADEQ's definition of projected 

actual emissions on the basis that it does not specifically require malfunction emissions to be included 

in the post-change projection. EPA has not shown how ADEQ's exclusion of this term from ADEQ's 

definition makes the definition less stringent than the Federal rules. Malfunctions, by definition, are 

emissions associated with an unpredictable and not reasonably preventable event. In this respect, it is 

axiomatic that a source cannot reasonably project emissions that it cannot predict. By excluding 

malfunctions from its projected actual emissions procedure, ADEQ recognizes EPA's own interpretation 

of "malfunctions" and is no less stringent than the federal definition. EPA's proposed action also is 

inconsistent with other Regional Office SIP approvals that have approved definitions of "projected 

actual emissions" that do not require inclusion of malfunction emissions.23 Moreover, the comparable 

paragraph in the Federal definition of "projected actual emissions" merely clarifies that projected 

actual emissions includes all post-change emissions. EPA could approve ADEQ's "projected actual 

emissions" definition by severing and not acting on paragraph R18-2- 401(20)(b)(iii) and the definition 

would not lose its intended meaning.

Response 9:

The commenter asserts that EPA has not shown that ADEQ’s exclusion of malfunction emissions from 

the definition of “projected actual emissions” makes the definition less stringent. However, ADEQ has 

the burden of demonstrating that its alternative definitions are not less stringent than the ones in 

EPA’s regulation. See 40 CFR 51.165(a)(1), 51.166(b). ADEQ’s definitions under the PSD and NA-NSR 

programs warrant a limited disapproval because EPA cannot reasonably conclude that ADEQ’s 

definition is at least as stringent as the definitions in 40 CFR 51.165(a)(1) and/or 51.166(b). We note 

that ADEQ’s definition for “baseline actual emissions” specifically includes startup, shutdown, and 

malfunction emissions, while ADEQ’s definition for “projected actual emissions” includes startup and 

shutdown emissions but does not include malfunction emissions. Further, ADEQ’s definition of 

“projected actual emissions” specifically excludes malfunction emissions associated with a shutdown. 

Based on the exclusion of malfunction emissions from the definition of “projected actual emissions”, 

and in the absence of a response from ADEQ on this issue, we conclude that ADEQ has not shown that 

its definition is as stringent as the federal definition. In addition, without a clearer statement from 

ADEQ, we cannot determine that R18-2-401(20)(b)(iii) is separable from the rest of the ADEQ definition 

of projected actual emissions without losing the apparently intended meaning by ADEQ to specifically 

include startup and shutdown but exclude malfunction emissions. We note that ADEQ’s comments did 

not address this basis for our proposed limited disapproval.

With respect to the claim that EPA has previously approved PSD or NA-NSR programs that do not 

include malfunctions emissions under the definition for projected actual emissions, we note that the 

 23 See, e.g., EPA's approval of Georgia's PSD program, Georgia's PSD program at 391-3-1; and EPA's approval of South 

Carolina's regulation at Chapter 7 Regulation 62.5.
Response to Comments

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June 2015

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examples provided by the commenter are not completely analogous. In those programs, the definition 

of baseline actual emissions also excluded malfunction emissions, whereas ADEQ has included those 

emissions in its definition of baseline actual emissions. Without further justification from ADEQ, this 

inconsistency across definitions makes it difficult for EPA to determine the relative stringency of 

ADEQ’s definitions as compared with those in 40 CFR 51.165 and 51.166. The commenter has not 

provided any information about the nature of the demonstrations that was supplied by the states that 

obtained EPA approval for excluding malfunction emissions from both the definition of baseline actual 

emissions and projected actual emissions.

Notwithstanding prior EPA action in the context of SIPs in the distinct circumstances noted above, EPA

believes the proper interpretation of these definitions is that they require that all emissions, pre- and 

post-change, including malfunctions, be included in the definitions included in SIPs, consistent with the 

regulatory text, absent a demonstration that the State’s regulation is at least as stringent as the federal 

definition as required by 40 CFR 51.165(a)(1) and 51.166(b).

We note that in reviewing this comment, we also reviewed our proposed limited disapproval related to 

the calculation of baseline actual emissions under ADEQ’s PALs program at R18-2-412(B)(2). See 80 FR 

14053. Upon review, we determined that our proposed limited disapproval related to the calculation 

of baseline actual emissions under ADEQ’s PALs program at R18-2-412(B)(2) was in error because 

ADEQ’s definition for baseline actual emissions at R18-2-401(2)(i) specifically includes startup, 

shutdown, and malfunction emissions. Therefore, this issue no longer provides a basis for our limited 

disapproval of ADEQ’s NSR SIP submittal. 

ADEQ’s Definition of “Regulated NSR Pollutant”

Comment 10: 

(Commenter: SRP)

One commenter asserts that ADEQ’s definition of regulated NSR pollutant is not deficient for not 

including the final two sentences in 40 CFR 51.166(b)(49)(i)(a). This language addresses issuance of 

permits before January 1, 2011. Since this SIP revision applies to changes after this date, it is not 

necessary for the definition to address circumstances that existed before SIP approval. Moreover, 

absence of the language, in any case, does not affect the stringency of the definition.

Response 10:

We agree with the commenter that while ADEQ may want to add to its definition these two sentences 

that provide additional clarification, this clarifying language is not necessary for SIP approval. As such, 

we no longer find this difference to be a deficiency with ADEQ’s NSR program, and this issue is not a 

basis for our final limited disapproval.

Necessity of Definition for “Subject to Regulation”

Comment 11: 

(Commenters: SRP and ADEQ)
Response to Comments

AZ NSR SIP Submittal 

June 2015

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EPA proposes to disapprove ADEQ's major NSR programs because the SIP submittal does not include a 

definition for "subject to regulation." Although the Federal regulations contain a definition for "subject 

to regulation," EPA made clear, at the time it adopted this definition, that states may adopt (or already 

have) alternative pathways for defining applicability of the major NSR program -- US EPA did not intend 

for codification of "subject to regulation" to be a necessary element for SIP approval. See 75 FR 31514 

at 31525. EPA chose the "subject to regulation" pathway because it determined that this would allow 

other states to adopt EPA's definition through interpretation without the need for a SIP revision. 

ADEQ's major source definition refers to NSR regulated pollutants. ADEQ's definition of NSR regulated 

pollutant covers all pollutants ADEQ is currently required to regulate under its major NSR programs. 

ADEQ's program is not currently deficient for failing to include some unknown air pollutant that US EPA 

may regulate in the future. Should EPA regulate such an air pollutant in the future, EPA may follow the 

pathway it used for greenhouse gas emissions (GHGs) and issue a SIP call at that time. Similarly, ADEQ's 

definition of regulated NSR pollutant is not currently deficient for failing to include some unidentified 

air pollutant that US EPA might name in the future.

Response 11:

After further review and consideration of the comment, we are not including the absence of a 

definition of the term “subject to regulation” as a basis for our limited disapproval of the ADEQ NSR SIP 

submittal. Similarly, we are also not including the omission in ADEQ’s PSD rules of language analogous 

to that in 40 CFR 51.166(b)(49)(iv) as a basis for our final limited disapproval of the ADEQ NSR SIP 

submittal. We note, however, that contrary to commenters’ assertion, the ADEQ SIP is deficient 

because ADEQ’s definition of regulated NSR pollutant does not cover all pollutants ADEQ is currently 

required to regulate under its major NSR programs, in that ADEQ’s program does not regulate GHGs. 

However, EPA has separately taken action to address this deficiency. EPA previously established a FIP 

for GHGs for Arizona because ADEQ could not apply its PSD program to GHGs due to a State law 

prohibition. 

ADEQ’s Definition of Basic Design Parameter

Comment 12:

(Commenter: SRP)

One commenter states that we must approve ADEQ’s definition of basic design parameter because the 

D.C. Circuit made no finding in State of New York v. EPA that the use of the "basic design parameter" 

definition was "impermissible." This issue was not before the court in State of New York v. EPA. At the 

time EPA codified the replacement unit provisions, EPA relied on a previously codified definition of 

"basic design parameter" to explain how it will interpret the phrase "basic design parameters" in 

implementing the replacement unit provisions. The vacatur of the "basic design parameters" definition 

for purposes of a separate, unrelated rulemaking has no effect on EPA's stated interpretation of that 

phrase for purposes of the replacement unit provisions. Accordingly, EPA's statements in the preamble 

remain its interpretation for purposes of implementing those provisions. ADEQ's definition is fully 

consistent with EPA's interpretation.
Response to Comments

AZ NSR SIP Submittal 

June 2015

Page 23 of 43

Response 12:

EPA agrees with the commenter that our proposed partial disapproval of the definition for “basic 

design parameter” was erroneous. We note that ADEQ did not adopt any of the other provisions of the 

Equipment Replacement Provisions, which were the subject of the D.C. Circuit Court’s decision in State 

of New York v. EPA. We agree with the commenter that ADEQ’s adoption of a definition for basic 

design parameter is acceptable in this case, and consistent with EPA’s past statements related to this 

term. Therefore, we are not finalizing a partial disapproval of ADEQ’s definition for basic design 

parameter. Our final action includes this definition as part of ADEQ’s NSR SIP submittal for which EPA is 

finalizing a limited approval/limited disapproval, but it is not a basis for our limited disapproval.

Technical Correction

Comment 13: 

(Commenter: ADEQ)

ADEQ points out that EPA’s March 18, 2015 Federal Register notice contained incorrect submission 

dates on page 14045. The references to “10/29/2014” in Table 1 should be “10/29/2012.”

Response 13:

EPA agrees that the date “10/29/2014” was a typographical error throughout Table 1 of our March 18, 

2015 Federal Register notice, which instead should have referenced “10/29/2012.” The correct date of 

that portion of the ADEQ NSR SIP submittal was October 29, 2012, as correctly described in the first 

paragraph of our preamble on page 14045: “On July 28, 2011 and October 29, 2012, ADEQ submitted 

revisions to the ADEQ portion of the Arizona SIP.” This error is corrected in Table 1 of the preamble for 

our final action.

Technical Correction

Comment 14:

(Commenter: ADEQ)

ADEQ points out that the definition of the term “begin actual construction” in R9-3-101 should be 

retained, since EPA is not acting on the revised definition included in the 2012 submission. Rule R9-3-

101(20) conforms to the current EPA definition and is necessary for a complete NSR program. EPA 

should add “[excluding subsection (20)]” to the Table 2 entry for R9-3-101.

Response 14:

EPA agrees with the commenter. ADEQ had requested that the existing SIP-approved definition of 

“begin actual construction” in Rule R9-3-101(20) remain in the Arizona SIP at this time, and EPA 

intended at the time of proposal, and still intends, to take action on the ADEQ NSR SIP submittal 

consistent with that request. See ADEQ’s February 23, 2015 supplement; TSD at 6, Table 2 and n.5 and 

62.24 Due to a typographical error, Table 2 of the March 18, 2015 Federal Register notice for our 

 24Other portions of the TSD for our proposed action also made clear that we were not acting on R9-3-101(20) as part of 

ADEQ’s request to remove R9-3-101 from the Arizona SIP and that we were relying on R9-3-101(20) for our review of 

ADEQ’s NSR SIP submittal. See TSD at 4-5 (Table 1), 17, 34, 45, 61. 
Response to Comments

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June 2015

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proposal, which describes those pieces of ADEQ’s program that we intend to remove from the SIP, 

indicated that Rule R9-3-101 would be superseded or removed from the SIP, but did not specify that 

ADEQ’s definition of “begin actual construction” in Rule R9-3-101(20) would not be removed from the 

SIP as part of this action. The text above this Table did make clear that our approval of ADEQ’s new 

regulations would not have the effect of superseding our prior approval of certain regulation sections 

that ADEQ had requested that we not remove from the SIP at this time. 80 FR at 14046 and n.5. Our 

intent is to keep R9-3-101(20) in the SIP until further EPA action on ADEQ’s revised definition for “begin 

actual construction” in R18-2-101, consistent with ADEQ’s request. See TSD at 6. Accordingly, our final 

action does not remove Rule R9-3-101(20) from the Arizona SIP. We agree with the commenter that 

the entry for R9-3-101 in Table 2 should have included “[excluding subsection (20)].” This error has 

been corrected in the preamble for our final rule; see Table 2.

Technical Correction

Comment 15:

(Commenter: ADEQ)

ADEQ points out that Table 2 of our March 18, 2015 proposal on page 14046 inadvertently omitted R9-

3-310 and R9-3-312, but addressed removal of these rules from SIP in the TSD. They should be included 

in the final version of Table 2.

Response 15:

EPA agrees with the commenter. ADEQ had requested we remove rules R9-3-310 and R9-3-312 from 

the Arizona SIP in its July 28, 2011 submittal. Due to a typographical error, rules R9-3-310 and R9-3-

312 were inadvertently omitted from the listing in Table 2 of our March 18, 2015 FR notice. Section 7 

of our TSD– Review of Existing SIP Rules and Stationary Provisions to be Replaced – identifies and 

describes the basis for removing these rules from the SIP. See TSD at 65. We agree with the 

commenter that these rules should have been listed in our proposed action. This error has been 

corrected in our final rule; see Table 2.

ADEQ’s Definition of “Begin Actual Construction”

Comment 16: 

(Commenter: SRP)

One commenter states that ADEQ asked EPA not to act on its definition of "begin actual construction," 

because EPA believes that this definition is not consistent with EPA's definition. The commenter then 

provides several arguments for why it believes that ADEQ’s revised definition of “begin actual 

construction” is approvable. 

Response 16:

The commenter is correct that ADEQ requested that EPA not act at this time on ADEQ’s revised 

definition of “begin actual construction” at R18-2-101(20), and, accordingly, we did not propose any 

action on ADEQ’s revised definition of “begin actual construction” at R18-2-101(20), as discussed in our 

TSD at p. 6. See also 80 FR 14045 and ADEQ’s February 23, 2015 supplement. EPA will take action on 
Response to Comments

AZ NSR SIP Submittal 

June 2015

Page 25 of 43

ADEQ’s definition of “begin actual construction” in a separate action if ADEQ resubmits or otherwise 

requests approval of the revised definition. In the interim, ADEQ’s program will rely on the existing SIPapproved definition for begin actual construction at R9-3-101(20), which is not being removed from 

the Arizona SIP as part of our action, consistent with ADEQ’s request. See Table 2 of our final action. 

Accordingly, to the extent the comment asserts that ADEQ’s revised definition of “begin actual 

construction” at R18-2-101(20) is approvable by EPA, the comment addresses matters outside the 

scope of our March 18, 2015 notice and our final action on ADEQ’s NSR SIP submittal. See also 

response to comment 14.

Minor Issues and Limited Disapproval

Comment 17:

(Commenter: ADEQ) 

Throughout the proposal, EPA identifies a number of minor issues, such as erroneous cross-references 

and undefined terms, as reasons for limited disapproval. Although ADEQ intends to fix these problems, 

ADEQ believes that they can all be resolved in the interim through reasonable interpretation of the 

existing rules and therefore should not be included as bases for limited disapproval. ADEQ is concerned 

that insistence on classifying obvious, easily resolved errors as deficiencies requiring disapproval could 

prove costly for Arizona and other states when they submit revised SIPs under the threat of a sanctions 

or FIP clock. For example, if in the course of amending its Part D rules to correct the deficiencies EPA 

has identified, ADEQ inadvertently includes an erroneous cross-reference, would EPA then feel 

obligated to issue limited disapproval of this Part D provision and therefore leave the sanctions clock 

running?

Response 17:

EPA appreciates ADEQ’s concern that a small error in a SIP submittal, such as a future SIP submittal 

correcting the deficiencies identified in this action, might unnecessarily lead to a FIP or sanctions. 

While we recognize that limited approval of ADEQ’s updated rules into the Arizona SIP will strengthen 

the SIP overall, in the Federal Register notice for our proposed action, we described the specific federal 

statutory and regulatory CAA requirements that we proposed to find were not met by the submittal 

because of numerous identified deficiencies. Commenters raised issues and/or provided clarification 

concerning some of the deficiencies identified in our proposal. Based on our careful consideration of 

those comments, in some instances we revised our determination about whether a particular 

discrepancy between the federal requirements and the provisions in ADEQ’s NSR SIP submittal 

warranted disapproval, as described elsewhere in these responses to comments. 

EPA is confident that ADEQ, as it stated in its comments, will correct all identified deficiencies in its 

upcoming rulemaking action, and we intend to work with ADEQ to facilitate ADEQ’s adoption of 

revisions to its NSR program and other rules in a manner that will lead to full program approval. EPA 

retains the discretion to review any updated ADEQ NSR SIP submittal based on the specific facts and 

circumstances presented, and the presence of minor, inadvertent errors would not necessarily require 

disapproval of the submittal.
Response to Comments

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June 2015

Page 26 of 43

References to Standards Imposed in Article 2 of Chapter 18 of Arizona’s Air Quality Regulations

Comment 18: 

(Commenter: SRP)

One commenter notes that EPA raised concerns with ADEQ’s reference to “state ambient air quality 

standards” and standards imposed in Article 2 of Chapter 18 of Arizona’s air quality regulations, 

because EPA is uncertain whether such standards can apply outside of ADEQ jurisdictions. The 

commenter does not believe that this concern should affect the approvability of ADEQ’s regulations.

The commenter states that Article 2 of Chapter 18 references levels of air pollutant concentrations in 

"ambient air," in a manner that mirrors the NAAQS. ADEQ defines "ambient air" as the "portion of the 

atmosphere, external to buildings, to which the general public has access. This definition includes air 

outside ADEQ's jurisdiction. ADEQ possesses full authority to regulate stationary sources operating 

within its jurisdiction to prevent emissions that would exceed any specified concentration in any 

location, even if that location is outside its jurisdiction. It is not necessary for ADEQ to have jurisdiction 

of all ambient air to regulate how sources in ADEQ's jurisdiction operate and affect that air.

A different commenter, ADEQ, also referenced this topic in the context of its comments on EPA’s 

proposed determination concerning ADEQ’s minor NSR rule provisions. ADEQ’s comment 

“acknowledge[d] that the applicability of the state’s minor NSR program to impacts by Arizona sources 

on areas outside the state needs to be clarified, as stated by EPA.” 

Response 18:

We disagree with the first commenter’s assertions. ADEQ’s NSR program regulations apply Arizona air 

quality standards rather than the NAAQS in the context of NSR review. As we explained in our 

proposed action, these Arizona air quality standards do not appear to apply outside the State of 

Arizona and ADEQ has not provided a demonstration that they apply outside the State. See 80 FR at 

14048, 14056; R18-2-302.01(C); R18-2-334(C)(2), (F), (G); and R18-2-406(A)(5)(a). The CAA and its 

implementing regulations require that ADEQ’s NSR program ensure that sources subject to NSR review 

in areas within ADEQ’s jurisdiction will not cause or contribute to exceedances of the NAAQS, which 

includes areas outside of Arizona, where Arizona air quality standards do not appear to apply. CAA 

sections 110(a)(2)(C) and (D), 165(a)(3); 40 CFR 51.160(a)(2), (b)(2); 40 CFR 51.165(b); 40 CFR 

51.166(k)(1).

ADEQ’s definition for “ambient air” is not sufficient to demonstrate that ADEQ’s NSR regulations 

ensure that sources subject to NSR review within Arizona will not cause or contribute to an exceedance 

of the NAAQS in areas outside of Arizona. The commenter has not demonstrated that ADEQ’s 

definition of “ambient air” changes the air quality standards that are being applied under ADEQ’s NSR 

program – i.e., Arizona air quality standards – or the location where they apply, which appears to be 

limited to Arizona. We agree with the commenter that ADEQ need not have jurisdiction in other areas 

in order to ensure that sources within its jurisdiction will not cause adverse impacts outside of its 

jurisdiction. However, ADEQ’s NSR regulations must provide ADEQ with clear authority to ensure that 

stationary sources located in areas within its jurisdiction and subject to NSR review will not cause or 
Response to Comments

AZ NSR SIP Submittal 

June 2015

Page 27 of 43

contribute to violations of the NAAQS in areas outside the State. And, ADEQ acknowledged in its 

comments on our proposed action that it intends to revise its regulations to remedy this issue and did 

not suggest or demonstrate that its regulations are sufficiently clear as currently written to ensure that 

stationary sources within the State would not cause or contribute to exceedances of the NAAQS in 

areas outside of Arizona. 

We continue to find this to be a deficiency in the ADEQ rules covering both major and minor sources 

regulated under ADEQ’s NSR program as we indicated in our proposal. 80 FR at 14048, 14056. In our 

final action, we find that this issue is a basis for our limited disapproval of ADEQ’s NSR SIP submittal.

References to Article 2 Outside of the PSD Context

Comment 19: 

(Commenter: ADEQ)

The basis for EPA’s objection to ADEQ referencing “Article 2” of its rules, rather than the “NAAQS,” 

outside of the PSD context is unclear. ADEQ states that, as EPA itself notes, PSD is the only NSR 

program that requires enforcement of a new NAAQS immediately on its promulgation and the noninclusion of the latest revision to the PM2.5 NAAQS is therefore “not a disapproval issue for ADEQ’s 

minor NSR and NA–NSR programs.” 80 Fed. Reg. at 14048 n. 8. 

Response 19:

We assume the commenter is referring to language in our proposal and TSD that stated that although 

“NAAQS” is a defined term in ADEQ’s regulations, ADEQ’s NSR program generally does not refer to the 

NAAQS and instead generally references the State’s ambient air standards in Article 2 of ADEQ’s air 

program. See 80 FR 14048 and TSD at 19. In response, EPA does not have concerns with ADEQ’s 

general approach of referencing its ambient air standards in Title 18, Chapter 2, Article 2, which 

generally adopt the NAAQS, instead of directly referencing the NAAQS. EPA’s basis for the limited 

disapproval referenced by ADEQ, under 40 CFR 51.160(a)(2) and (b)(2), only pertains to the issue that 

Arizona’s ambient air standards do not apply outside the State of Arizona. We acknowledge that this 

language in both our proposal and TSD was somewhat unclear. ADEQ acknowledged in its comments 

on our proposed action that this discrepancy in its rules needs to be clarified, and EPA continues to 

believe that ADEQ must still address this deficiency related to the fact that ADEQ’s NSR program 

applies only State air quality standards, which do not apply outside Arizona. But, ADEQ does not have 

to necessarily correct this issue by referencing the NAAQS so long as the requirements of 40 CFR 

51.160(a)(2) and (b)(2) are met.25

 25 EPA’s proposal also noted this issue in the context of provisions that are included in the federal NA-NSR regulations at 40 

CFR 51.165(b) but which address new major stationary sources or major modifications in attainment areas that would cause 

or contribute to a violation of a NAAQS in an adjacent area. See 80 FR at 14056. The deficiency EPA identified concerning 

the reference to ADEQ’s Article 2 air quality standards in this context – in ADEQ rule R18-2-406(A)(5)(a)-(b) -- is the same as 

that identified for the other NSR program requirements: it does not clearly protect the NAAQS in areas outside of Arizona, 

where Arizona’s Article 2 air quality standards do not apply. This issue remains a deficiency that provides a basis for our 

limited disapproval.
Response to Comments

AZ NSR SIP Submittal 

June 2015

Page 28 of 43

Use of the Undefined Term “Arizona Ambient Air Quality Standards”

Comment 20:

(Commenter: ADEQ)

ADEQ states that EPA’s claim that use of the undefined term “Arizona Ambient Air Quality Standards” 

in some NSR provisions “makes the standards ambiguous” is incorrect. Although undefined, this term is 

clearly intended to refer to the standards in Title 18, Chapter 2, Article 2, which restate the current 

NAAQS. There are no other provisions in ADEQ’s rules that could qualify as Arizona Ambient Air Quality 

Standards and thus no ambiguity. ADEQ intends to amend its rules to clarify NAAQS applicability, but 

does not believe minor errors such as this form a valid basis for objection, as noted in the introduction 

to ADEQ’s comments.

Response 20:

Upon review of ADEQ’s comment, EPA agrees that references to Arizona Ambient Air Quality 

Standards, and other similar references, in ADEQ’s regulations are intended to reference ADEQ’s 

ambient air standards in Title 18, Chapter 2, Article 2, as these are the only ambient air standards in 

ADEQ’s rules and regulations. As such, we no longer find that this issue is a deficiency that must be 

addressed for full SIP approval, and this issue does not provide a basis for our final limited disapproval. 

Nevertheless, because assuring attainment and maintenance of the NAAQS is a cornerstone of the NSR 

program, we strongly encourage ADEQ to revise its regulations to adopt consistent terminology 

regarding the air quality standards that are applicable in the context of its NSR program, as ADEQ has 

indicated that it plans to do. 

EPA’s Proposal and Earlier EPA Recommendations

Comment 21: 

(Commenter: SRP)

SRP explained that EPA previously suggested that ADEQ include "a source registration program for 

smaller facilities that would achieve the same environmental benefit as a traditional permitting 

program...." SRP asserts that EPA also suggested that ADEQ "exempt those activities listed as 

'insignificant activities' at R18-2-101.54," and noted that once ADEQ establishes appropriate permitting 

thresholds, it may "provide a partial or full exemption from the full public process requirements of 

51.160(e), consistent with the environmental significance of the change." Nonetheless, EPA’s proposed 

action contradicts these recommendations and would disapprove the very program elements it 

suggested ADEQ include in its program. 

Response 21:

We disagree with the commenter that our proposed rule improperly contradicts previous suggestions 

made by EPA to ADEQ with respect to ADEQ’s NSR program and, in particular, its minor NSR program. 

The commenter cites a letter from EPA to ADEQ dated May 22, 1996 responding to a request from 

ADEQ for guidance from EPA concerning CAA requirements for minor NSR programs, in which EPA 

provided a brief summary of statutory and regulatory requirements, preamble language and case law 

relevant to requirements for the minor NSR program. 
Response to Comments

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June 2015

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As an initial matter, the comments or suggestions made by EPA that pertained to the ADEQ rule 

development process were provided to ADEQ for informational purposes and to facilitate that process, 

and do not represent a final decision by EPA. The commenter appears to imply that our preliminary 

comments to ADEQ were controlling or binding on our final decision in this action. While we aim to, 

and often do, provide comments early and throughout a state's rulemaking process, those comments 

are not final agency actions. There is nothing in the Act that requires such comments, much less that 

makes them binding on EPA such that EPA would be required to approve a SIP submittal that does not 

meet CAA requirements. To the contrary, Congress entrusted with EPA an oversight role to ensure the 

requirements of the Act are met. Prior to our proposed action on the ADEQ NSR SIP submittal, EPA had 

taken no rulemaking action nor made any other final decision that concluded that ADEQ’s registration 

program or current minor NSR program as a whole (or major/minor NSR program as a whole), as 

adopted and submitted by ADEQ, was fully approvable in all respects, nor has the commenter 

identified any such decision by EPA.

While EPA suggested in 1996 that ADEQ consider developing a registration program for smaller 

stationary sources “that would achieve the same environmental benefit as a traditional permitting 

program,” we did not indicate that any particular registration program would necessarily meet CAA 

requirements. In fact, we indicated that the program would need to “meet the specified requirements” 

for minor NSR programs.26 Further, EPA proposed, and is finalizing, a limited approval and limited 

disapproval of ADEQ’s NSR SIP submittal, including its minor NSR program, which specifically 

incorporates the registration program that ADEQ developed in rule R18-2-302.01 as a component of 

ADEQ’s minor NSR program designed to satisfy CAA section 110(a)(2)(C) and 40 CFR 51.160-51.164. As 

such, EPA is approving the registration program developed by ADEQ into the SIP. Nevertheless, EPA 

identified certain deficiencies with ADEQ’s submitted registration program when conducting our 

review to determine whether ADEQ’s NSR SIP submittal satisfies CAA requirements, and these 

deficiencies are some of the bases for our final limited disapproval.

Similarly, we do not agree with the commenter’s suggestion that because EPA staff, in 1996, suggested 

that ADEQ consider exempting “insignificant activities” as defined in a particular ADEQ rule – R18-2-

101(54) -- from regulation under its minor NSR program, there is an improper contradiction in our 

limited disapproval under 40 CFR 51.160(c)(1). First, in its rulemaking action in 2012, ADEQ modified 

the definition of “insignificant activity,” expanding the scope of activities that fall within that definition 

as compared with the definition that EPA had commented on in 1996.27 Therefore, the statement EPA 

made regarding an earlier version of this definition does not apply equally to the revised, broader 

definition. See Appendix A of ADEQ’s October 29, 2012 submittal at 1581-1582. Further, it does not 

appear that ADEQ elected to fully exempt “insignificant activities” as defined in its rules from the 

coverage of its minor NSR program as EPA had suggested that it might consider doing. Instead, ADEQ 

exempted certain activities defined as “trivial” and “categorically exempt” from its minor NSR program 

 26 See EPA letter to ADEQ dated May 22, 1996 at 2. 27 As part of this 2012 rulemaking, the ADEQ definition of “insignificant activity” was moved to a different regulatory 

provision, and now appears at ADEQ rule R18-2-101(68).
Response to Comments

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June 2015

Page 30 of 43

(including both the registration and Class II permitting components of that program) in ADEQ rule R18-

2-302(C)(1). As discussed in our TSD, we find these exemptions from the minor NSR program to be 

approvable.28 With respect to ADEQ’s revised definition of “insignificant activity,” ADEQ rule R18-2-

304(E)(9) provides that permit applications for NSR permits (including both Class II permits, for minor 

sources with greater emissions, and Class I permits, for major sources) must identify activities defined 

as “insignificant activities” but need not include emissions data for any such activities. Our limited 

disapproval of ADEQ’s NSR SIP submittal is based in part on our finding that this ADEQ rule does not 

fully satisfy the requirement at 40 CFR 51.160(c)(1). This federal rule requires that minor NSR programs 

include legally enforceable procedures that provide for the submission by applicants of information on 

the nature and amounts of emissions to be emitted by the project.29 While our proposal made clear 

that the requirements of 40 CFR 51.160(c)(1) provided the basis for our limited disapproval of R18-2-

304(c)(9), the commenter has not explained how ADEQ rule R18-2-304(c)(9) meets the requirements of 

40 CFR 51.160(c)(1), and thus we continue to conclude that this issue provides an appropriate basis for 

our limited disapproval.

Finally, we do not agree with the commenter that there is a contradiction between the statements 

made by EPA in correspondence from 1996 related to 40 CFR 51.160(e) and our limited disapproval of 

ADEQ’s NSR SIP submittal under 40 CFR 51.161(a), which relates to the public participation 

requirements of the minor NSR program. While EPA indicated at that time that ADEQ may "provide a 

partial or full exemption from the full public process requirements of 51.160(e), consistent with the 

environmental significance of the change,” concerns about the scope of sources exempted under 40 

CFR 51.160(e) were not, and are not, the basis for our disapproval of ADEQ’s NSR SIP submittal specific 

to 40 CFR 51.161(a). ADEQ conducted an analysis to demonstrate that the “permitting exemption 

thresholds” in its rule R18-2-101(99) were the appropriate emission thresholds for triggering its minor 

NSR program under 40 CFR 51.160(e). As such, construction or modification projects at or above those 

thresholds are part of ADEQ’s minor NSR program under 40 CFR 51.160(e), and projects subject to the 

minor NSR program must adhere to public participation requirements consistent with 40 CFR 

51.161(a). The deficiency EPA identified with ADEQ’s minor NSR program under 40 CFR 51.161(a) 

pertains to projects that would be at or above this threshold but which ADEQ’s regulations do not 

subject to public participation requirements as necessitated by 40 CFR 51.161(a). This deficiency 

provided one basis for our proposed limited disapproval, we continue to find that this is a deficiency 

that must be corrected, and the commenter has not shown that this was in error.

Foundation for EPA’s Proposed Action

Comment 22:

(Commenter: SRP) 

 28 See TSD at 25 (Section 5.2.2.2). 29 In our March 18, 2015 Federal Register notice for this action, we acknowledged that many of the activities listed in 

ADEQ’s definition of “insignificant activity” would not be expected to emit regulated NSR pollutants. As such, our limited 

disapproval relates to the ADEQ rule’s failure to require that applicants provide emissions information related to those 

activities defined as “insignificant activities” that generally would be expected to emit regulated NSR pollutants.
Response to Comments

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EPA's proposed action lacks the necessary regulatory and statutory foundation to support its proposed 

limited approval and limited disapproval of core elements of the NSR programs. SRP believes that its 

comments provide a pathway for approving ADEQ’s NSR SIP submittal. SRP was unable to comment on 

all issues in the proposal and encourages EPA to determine whether additional issues that EPA raised 

in the proposal are flawed.

Response 22:

We have responded to all specific comments made by the commenters. This comment is not specific 

and therefore does not require a detailed response. Nevertheless, we disagree with the commenter’s 

assertion that our limited approval/limited disapproval of the NSR SIP submittal lacks the necessary 

regulatory and statutory foundation, and do not believe that the commenter’s comments provide a 

basis for full approval of ADEQ’s NSR SIP submittal. We fully describe the CAA statutory and regulatory 

requirements that provide the bases for our limited disapproval in our proposed and final actions. To 

the extent that comments we received raised questions or concerns about the bases for our proposed 

action, our response to comments addresses those comments and provide additional detail supporting 

our final action.

We appreciate receiving and reviewing comments pointing out potential errors or concerns with our 

proposal. In addition to responding to comments, we have described and explained changes made 

between the proposed and final actions on the ADEQ NSR SIP submittal. 

EPA’s Proposal and ADEQ’s Stakeholder Process

Comment 23: 

(Commenter: SRP)

One commenter explained that ADEQ undertook an extensive, multi-year stakeholder process to work 

with all stakeholder groups to develop revised NSR rules that meet Arizona's air quality management 

goals and satisfy federal CAA requirements. Stakeholders included representatives from environmental 

organizations, regulated entities, and regulators (including EPA Region 9 staff), and spanned over half 

of a decade. During each phase of the public outreach process and in numerous meetings with EPA 

Region 9 staff, ADEQ responded to EPA concerns by incorporating suggested revisions, or explaining 

ADEQ's rationale for structuring the rules in a specific manner.

The commenter states that ADEQ remains under no obligation to revise and strengthen its existing 

minor NSR permitting program. Nonetheless, ADEQ worked with stakeholders to craft an improved 

minor NSR program that better meets Arizona's current air quality needs compared to the SIPapproved version of the rule. In doing so, ADEQ followed EPA's recommendations, and mirrored its 

provisions after elements of other States' SIP-approved programs when appropriate for the air quality 

needs of Arizona. Yet, in EPA's proposed action, it would disapprove the very program elements that 

EPA suggested, use interpretations that conflict with established EPA legal positions, and deny ADEQ 

the types of flexibility and improvements approved by multiple EPA Regional Offices into other State 

SIPs.
Response to Comments

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June 2015

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Response 23:

EPA acknowledges the significant stakeholder process undergone by ADEQ in revising and updating its 

NSR program and appreciates the substantial efforts made by ADEQ in developing its updated and 

strengthened NSR program, including its enhanced minor NSR program. However, we disagree with 

the statements made by the commenter with respect to our action on this program. 

Regarding the commenter’s statements that EPA used “interpretations that conflict with established 

U.S. EPA legal positions, and deny ADEQ the types of flexibility and improvements approved by 

multiple, U.S. EPA Regional Offices into other State SIPs”, the comment did not provide the level of 

specificity necessary for us to ascertain the commenter’s concerns with our proposed action in this 

regard, and therefore we cannot provide a detailed response. To the extent the commenter raises 

these issues in a more specific manner in other comments, we provide our responses elsewhere in this 

response to comments document. In general, however, we disagree that our action on ADEQ’s NSR SIP 

submittal uses interpretations that conflict with established U.S. EPA legal positions. We also believe 

that our determinations on particular issues, and our final action on ADEQ’s NSR SIP submittal, 

properly apply the CAA and associated regulatory requirements governing SIPs, including those 

requirements for NSR programs, and appropriately defer to State choices and flexibilities. 

Regarding the commenter’s statement that ADEQ has no obligation to revise and strengthen its minor 

NSR permitting program, this issue is not relevant, because ADEQ has, in fact, acted to update and 

strengthen its minor NSR program, and has submitted a request that EPA approve this updated 

program into the SIP while at the same time removing ADEQ’s old NSR provisions from the SIP. 

Regardless of whether this particular submittal was required, EPA must act on the pending ADEQ NSR 

SIP submittal. States are required to incorporate minor NSR requirements into their SIPs to satisfy CAA 

section 110(a)(2)(C) and 40 CFR 51.160-51.164. EPA’s role in reviewing SIP submittals, including the 

ADEQ NSR SIP submittal, is to defer to the State’s choices as to how to implement CAA requirements 

provided those choices are consistent with the pertinent CAA requirements, whether or not an 

updated program submittal is required at a particular point in time to address a required SIP element. 

Clarity of Action Being Proposed

Comment 24:

(Commenter: SRP) 

One commenter states that EPA's notice lacks clarity on precisely what action EPA is proposing on 

different elements of the SIP submission. For example, sections titled "Summary" and "Section Ill. 

Public Comment and Proposed Action" discuss only a limited approval, limited disapproval, yet within 

other text of the Federal Register notice, EPA proposes a disapproval without qualifying the 

disapproval as limited. Moreover, while EPA provides point-by-point explanations of alleged concerns 

with ADEQ's NA NSR and PSD programs, EPA often fails to explain how these concerns cause the 

program to fail to meet minimum NSR program elements or CAA requirements. Indeed, it is hard to 

imagine how some of the stated concerns (e.g., typographical errors in a rule, potential for confusion) 

rise to the level of potentially triggering a FIP or sanctions if the State does not act quickly enough to 

resolve EPA's concerns.
Response to Comments

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June 2015

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Response 24:

We disagree with the commenter that EPA’s notice lacked clarity. The Administrative Procedure Act 

(APA) requires a notice of proposed rulemaking to include “either the terms or substance of the 

proposed rule or a description of the subjects and issues involved.” 5 U.S.C. § 553(b)(3). We believe the 

Federal Register notice for our proposed action more than adequately provided “a description of the 

substance and issues involved” in our action, as required by the APA.

Section II of the preamble in the March 18, 2015 Federal Register notice contained a detailed 

discussion of our proposal and identified the actions we were proposing on the various program 

elements and provisions in the ADEQ NSR SIP submittal. In Section II, we described our proposed 

limited approval/limited disapproval on the vast majority of the provisions contained in the submittal, 

a partial disapproval on two separable elements of the submittal related to recent court decisions, a 

limited approval (without limited disapproval at this time) on certain PM2.5 NA-NSR provisions, and a 

limited approval/limited disapproval on certain non-NSR-specific provisions. Section III included a 

summary of our proposed action. Contrary to the commenter’s assertion that Section III only discussed

a limited approval/limited disapproval action, Section III specifically mentioned that we were “also 

proposing to partially disapprove two provisions of ADEQ’s NSR program that have been vacated by 

the courts.”30 In addition, section I.C of the preamble referred readers to the TSD for more detailed 

analysis.31 We acknowledge that the brief “Summary” section at the beginning of the preamble 

referred generally to proposed limited approval/limited disapproval and did not describe the specific 

proposed actions we intended to take on each component of ADEQ’s lengthy SIP submittal. However, 

the “Summary” section in our Federal Register notice was intended simply to provide a brief summary 

of the nature of our overall action, which is primarily a limited approval and limited disapproval, with 

the full extent of the proposed action described in greater detail later in the notice and in supporting 

documents.32

To the extent the commenter asserts that EPA failed to explain how the disapproval issues relating to 

the PSD and NA-NSR program cause ADEQ’s program to fail to meet minimum NSR program elements 

or CAA requirements, we disagree. The notice for our proposed action identified in each case the 

specific program element/CAA requirement that was not being met for each disapproval issue, 

including those which may have been the result of a typographical error or similar drafting mistake. In 

addition, our TSD provided further detail for each disapproval issue. We also note that CAA NSR 

regulations at 40 CFR 51.165(a)(1) and 51.166(b) require that SIPs include the specific definitions in the 

federal regulations, and state that deviations from this wording will be approved only if the State 

specifically demonstrates that the submitted definition is more stringent, or at least as stringent, in all 

 30 80 FR at 14060. 31 See 80 FR at 14047 (“We provide our reasoning in general terms below, and include our more detailed analysis in the 

TSD, which is available in the docket for this proposed rulemaking.”).

32 The style of a Federal Register notice is governed by the Office of Federal Register (OFR), which has issued guidelines to 

limit the length and contents of the Summary section. The Summary is intended to provide the public a brief, non-expert 

summary of the action that is being taken, and should not be construed as containing our position on every aspect of this 

action. OFR’s guidance specifically states: “Do not include qualifications, exceptions, or specific details.” See Federal 

Register Document Drafting Handbook at 1-8. http://www.archives.gov/federal-register/write/handbook/chapter-1.pdf.
Response to Comments

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respects as the corresponding federal definition. See also response to comment 17. It is unclear what 

type of additional information the commenter believes EPA should have provided, as the commenter 

has not provided any specific examples of disapproval issues for which EPA allegedly did not provide 

sufficient explanation. To the extent the commenter provides more detail in other comments that 

relate to this general concern, we address those concerns in our responses to those comments.

EPA’s Burden under Section 110(l)

Comment 25:

(Commenter: SRP)

A commenter asserts that under section 110(l) of the CAA, EPA must approve ADEQ’s requested SIP 

revision, including provisions related to ADEQ’s minor NSR program exemption thresholds in 

nonattainment areas, unless EPA shows that the "revision would interfere with any applicable 

requirement concerning attainment and reasonable further progress..., or any other applicable 

requirement of this chapter." The commenter states that EPA has not cited any basis that supports 

disapproving ADEQ's SIP submittal based on these CAA criteria. 

Response 25: 

We disagree with the commenter’s interpretation of section 110(l) of the Act. As explained in the 

preamble to the proposed action, EPA reviewed ADEQ’s SIP submittal based on compliance with 

specific applicable SIP requirements. In addition, EPA concluded that the SIP revision overall 

strengthened the provisions of the existing SIP, and therefore did not interfere with attainment – a 

conclusion that the commenter does not question. However, the commenter misconstrues section 

110(l) of the Act and EPA’s authority to disapprove SIP revisions. 

The commenter appears to interpret section 110(l) as requiring EPA to approve any SIP revision unless 

EPA concludes that the revision will interfere with attainment or another relevant requirement of the 

Act. This interpretation ignores the fact that the SIP revision, including the revisions to the minor NSR 

program, must satisfy certain specific requirements of the Act:

EPA has reviewed the provisions submitted by ADEQ that are the subject of this action, 

including those governing NSR for stationary sources under ADEQ jurisdiction for compliance 

with the CAA’s general requirements for SIPs in CAA section 110(a)(2), EPA’s regulations for 

stationary source permitting programs in 40 CFR part 51, sections 51.160 through 51.166, and 

the CAA requirements for SIP revisions in CAA section 110(l) and 193.

80 FR at 14047. As explained in the preamble to the proposed action, EPA found that for the most part, 

ADEQ’s NSR SIP submittal met these requirements, but in some cases, certain CAA statutory and 

regulatory requirements were not met. 80 FR at 14047. For each disapproval issue discussed in the FR 

notice for our proposed action on ADEQ’s NSR SIP submittal, we cited a CAA statutory and/or 

regulatory requirement that we had determined ADEQ’s program did not meet. As such, EPA 

demonstrated for each disapproval issue that ADEQ’s submittal would not meet an applicable 

requirement of the Act. EPA’s determination that ADEQ’s submittal did not meet CAA requirements, 
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including the criteria established in EPA’s implementing regulations, provide a reasonable basis on 

which to disapprove portions of ADEQ’s submittal. As described elsewhere in our final action and in our 

responses to comments, although we have changed our determinations on certain of the issues we 

identified as deficiencies in the proposal, the remaining issues that we identified in the proposal as 

deficiencies with ADEQ’s NSR SIP submittal do not satisfy certain applicable CAA requirements and 

therefore provide appropriate bases for our final limited disapproval action.

Contrary to the commenter’s assertion, there is nothing in the language in Section 110(l), nor any other 

legal authority, that holds that ADEQ is not obligated to meet all the relevant and applicable 

requirements of the Act for its SIP submittal except when EPA makes a finding that the State’s 

submittal would interfere with attainment and reasonable further progress under section 110(l). 

Rather, section 110(l) of the Act clarifies that for SIP revisions, in addition to other applicable CAA 

requirements: 

The Administrator shall not approve a revision of a plan if the revision would interfere with any 

applicable requirement concerning attainment and reasonable further progress (as defined in 

section 7501 of this title), or any other applicable requirement of this chapter.

42 USC 7410(l). 

As explained in our proposal, EPA has determined that our action on ADEQ’s SIP submittal is consistent 

with CAA section 110(l), in light of the fact that, taken in its entirety, the SIP revision represents a 

strengthening of ADEQ’s minor NSR, PSD, and NA-NSR programs as compared to the existing SIPapproved programs which were approved some decades ago, and that our limited approval/limited 

disapproval of this revision would not interfere with any applicable requirement concerning 

attainment and reasonable further progress, or any other applicable requirement of the Act. As noted 

above, the commenter does not question our conclusion under section 110(l). 

Nonattainment Areas and Control Requirements

Comment 26:

(Commenter: SRP)

One commenter states that EPA provided no supporting documentation to support its assertion that 

“typically, nonattainment areas have more control requirements that apply to smaller minor sources, 

compared to attainment areas.” The commenter states that information EPA collected after reviewing 

20 minor NSR programs contradicts this assertion; instead, this information demonstrates that 

applicability levels only "occasionally related to attainment status."33 Of the four States ADEQ reviewed 

to support its decision-making on the appropriate level for Arizona's minor NSR program, one state, 

Colorado, used different applicability thresholds based on attainment status. New Mexico, Nevada, 

 33 See "Review of State and Local Agencies' New Source Preconstruction Permit Programs for Minor Sources: Final Report" 

MRI Report for US EPA, September 30, 1997. Available in EPA Docket # EPA-HQ-OAR-2003-0076-0002.
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and Utah did not. In sum, EPA merely asserts without support that most other States have lower 

thresholds, and then jumps to a finding that ADEQ's program must be inadequate. 

Response 26:

The commenter misinterprets EPA’s statement. In the referenced statement, EPA was referring to 

control requirements, rather than NSR applicability thresholds, in nonattainment areas. However, we 

acknowledge that the Federal Register notice for our proposal lacked clarity regarding this point. 

Although we did not cite to any specific examples, our conclusion was based on the fact that 

jurisdictions regulating nonattainment areas are obligated under the CAA to demonstrate that the 

particular area will achieve the necessary emission reductions to attain the standard and to comply 

with the nonattainment SIP requirements in CAA 172(c), including implementation of all reasonably 

available control measures and reasonable further progress toward attainment. In doing so, a State 

may need to obtain emission reductions from minor sources through control requirements, where 

such minor sources may contribute to nonattainment. As such, in order to ensure that such sources 

will comply with the applicable control strategy, it may be prudent to require an NSR program covering 

a wider number of sources with smaller emissions than would be necessary in an attainment area in 

order to ensure the area will attain the NAAQS.34 For example, we found at least 20 rules in Maricopa 

County that contain control requirements for source categories that are not covered by ADEQ’s rules 

and regulations, and as ADEQ explained in its analysis, Maricopa County has for some time employed 

much lower permitting thresholds than ADEQ due to the severity of air quality problems there.35

Limited Disapproval Related to Proposed Final Permit

Comment 27:

(Commenter: SRP) 

One commenter disagreed with EPA’s proposal to disapprove ADEQ's NSR programs because 

references to a "proposed final permit" do not provide enforceable procedures that meet the 

requirements of 40 CFR 51.160(a) and (b). The commenter raises several concerns, particularly that 40 

CFR 51.160(a) and (b) do not require ADEQ to adopt procedures that "prevent construction until a final 

permit has been issued” as the provisions contain no requirements for a preconstruction permit 

program. Instead, the commenter states that ADEQ's procedures fully satisfy the requirement for 

legally enforceable procedures in two ways. First, the Director will review an application and meet all 

procedural requirements for public availability of information before issuing a proposed final permit. 

Because a source must have a proposed final permit before starting any physical building activities, 

these procedures prevent construction or modification that fail to meet the applicable requirements in 

accordance with 40 CFR 51.160(a) and (b). Second, authorizing a source to begin physical building 

activities does not qualify as authorizing construction because, at that time, operation is not also 

authorized. There are two essential elements for an activity to qualify as construction (or modification) 

1) it must qualify as a physical change or change in operation; and 2) it must be capable of resulting in 

 34 In fact, the CAA requires a lower major source threshold in some nonattainment areas, presumably so that more sources 

are subject to control requirements and review. 

35 See “List of Additional Source Category-Specific Rules in Maricopa County,” EPA Region 9, June 2015. 
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emissions. Since a stationary source may not begin operation until the Director issues a final permit, 

there is no potential for the activity authorized by a proposed final permit to have emissions. 

In addition, EPA fails to identify a regulatory provision in 40 CFR 51.160-51.166 to support its position. 

Notwithstanding this failure, ADEQ's letter of interpretation negates the necessity for a revision of the 

regulations. EPA has a longstanding policy of accepting State interpretive statements rather than 

requiring revision of the regulations in approving SIP submittals.

Finally, the commenter identifies that EPA has approved similar processes into the SIPs for other 

States. For example, in 2006, EPA Region 4 approved similar language for Kentucky’s PSD and 

nonattainment NSR regulations. 

Response 27:

The commenter raises a number of issues to support its argument that the language in ADEQ’s NSR 

program that allows certain sources to begin construction following the issuance of a proposed final 

permit satisfies the requirements in 40 CFR 51.160(a) and (b) and is not a proper basis for EPA’s 

proposed limited disapproval of ADEQ’s NSR program. As discussed in detail in response to comment 4

above, EPA has determined in light of ADEQ’s comments and interpretation of its rules that ADEQ’s 

NSR program provides that proposed final permits are final, binding, enforceable, and appealable NSR 

permit decisions, and, as a result, in our final action, the fact that ADEQ’s NSR program allows certain 

sources to begin construction after issuance of a proposed final permit is no longer a basis for our 

limited disapproval of ADEQ’s NSR SIP submission.36

Given that this issue is no longer a basis for our limited disapproval, we do not need to address all of 

the lengthy arguments made by the commenter. However, we note that allowing a source to be 

completely constructed, but not operate, prior to issuance of a final NSR decision does not satisfy the 

requirements of 40 CFR 51.160(a) and (b). See our partial disapproval of South Dakota’s minor NSR 

program revisions at 79 FR 36419 (June 27, 2014). In that action, we partially disapproved South 

Dakota’s revised minor NSR program because it would have allowed a source to construct or modify 

prior to the State affirmatively approving the project. Specifically, we stated, “we interpret the CAA 

and implementing regulations to require regulation and approval of construction of any stationary 

source before the construction occurs, not as proposed by the State, review and approval [of] 

construction in process or after it has occurred.” 79 FR 36422. Also, discussion of the legal 

requirements for preconstruction review for the minor NSR program in 40 CFR 51.160(a) and (b) is 

provided in our response to comment 4 above. 

Public Review and ADEQ's Registration Program

Comment 28:

 36 We also agree that in certain situations it is appropriate for EPA to rely on State interpretive statements to address 

ambiguities in State SIP submittals. See EPA’s recent statements regarding EPA’s policy on State interpretive letters at 80 FR 

33884-33889. 
Response to Comments

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June 2015

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(Commenter: SRP)

The commenter indicates that EPA proposes to disapprove ADEQ’s registration program because, 

among other things, it fails to meet the public notice and comment process required under 40 CFR 

§51.161(a). EPA's proposed disapproval fails to comport with the EPA's interpretation of required 

public notice requirements, and is inconsistent with other recent EPA Regional Office actions related to 

minor NSR program approvals. The commenter points to other instances where EPA has approved 

tiered permitting programs, where a portion of the NSR program is not subject to public review. ADEQ 

conducted an analysis and determined that it need regulate only stationary sources above the 

specified permitting threshold. While EPA has no supportable basis for declining to approve ADEQ’s 

registration program, the program, nonetheless, is fully severable from the minor NSR program, and 

EPA may act to approve either provision without acting to approve or disapprove the other.

Response 28:

We disagree with the commenter that ADEQ’s registration program for minor stationary sources is not 

required to adhere to the public participation requirements in 40 CFR 51.161(a). The Act and its 

implementing regulations allow a State to exempt from federal minor NSR requirements, including the 

public participation requirements at 40 CFR 51.161(a), only those stationary sources that the State has 

demonstrated are not necessary to regulate as part of its minor NSR program. See our detailed 

discussion in response to comment 2. ADEQ has not made, or attempted to make, a demonstration 

that emissions from sources subject to its registration program are not necessary for attainment and 

maintenance of the NAAQS. Rather, ADEQ submitted an analysis as part of its NSR SIP submittal 

asserting that the emissions from sources below its “permitting exemption thresholds”, i.e., 

approximately one-half of the significant emission rates under the PSD program for the specified 

pollutants, need not be regulated under its minor NSR program. Minor stationary sources with 

emissions at or above the “permitting exemption thresholds” are subject to ADEQ’s minor NSR 

program, of which there are two components.

A source with emissions at or above the “permitting exemption thresholds” must comply with the 

requirements of ADEQ’s registration program under R18-2-302.01, which imposes less prescriptive 

requirements, unless the source has emissions at or above the significant level but below the major 

source threshold, in which case it is subject to the more traditional Class II minor source permitting 

program. See R18-2-302, R18-2-302.01, R18-2-334; see generally ADEQ Notice of Final Rulemaking, 18 

A.A.R. 1547-1552 (July 6, 2012) and ADEQ’s October 29, 2012 SIP Submittal (Document A.1 under 

Docket ID: EPA-R09-OAR-2015-0187-0006). Thus, both the registration program and the Class II 

permitting program are components of ADEQ’s NSR SIP submittal for purposes of satisfying CAA 

section 110(a)(2)(C) and 40 CFR 51.160-51.164. ADEQ has noted:

Review will be mandatory for sources with the potential to emit any regulated minor NSR 

pollutant above the permitting exemption threshold and discretionary for all other sources. In 

determining potential to emit for this purpose, elective limits or controls will be considered. 

Review is mandatory for sources above the permitting exemption threshold because that has 

been determined to be the de minimis threshold for the minor NSR program.
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ADEQ Notice of Final Rulemaking, 18 A.A.R. 1552 (emphasis added) and ADEQ’s October 29, 2012 SIP 

Submittal (See document A.1 under Docket ID: EPA-R09-OAR-2015-0187-0006).

Because both the registration component of ADEQ’s minor NSR program under R18-2-301.01 and the 

Class II permitting component of the program under R18-2-334 are part of ADEQ’s minor NSR program 

for purposes of the CAA, both components must meet the CAA public participation requirements in 40 

CFR 51.161(a). As the registration program is a component of ADEQ’s minor NSR program submittal, 

we also find that ADEQ’s minor NSR program is not separable from the rest of ADEQ’s minor NSR 

program under 40 CFR 51.160(e), contrary to the commenter’s assertion.

We acknowledge that the ADEQ Notice of Final Rulemaking for ADEQ’s 2012 NSR final rulemaking 

action often refers specifically to its Class II permitting for minor sources under R18-2-334 as “minor 

NSR,” which may have led to the commenter’s confusion about whether ADEQ’s registration program 

is a component of ADEQ’s minor NSR program submitted to satisfy CAA section 110(a)(2)(C) and 40 CFR 

51.160-51.164. The record is clear, however, that ADEQ’s registration program is a component of its 

minor NSR program submitted to satisfy CAA section 110(a)(2)(C) and 40 CFR 51.160-51.164 and 

therefore must comply with the applicable federal requirements for minor NSR programs.

Preventing Violation of an Applicable Portion of Control Strategy

Comment 29: 

(Commenter: SRP)

One commenter states that EPA faults ADEQ's submittal for not containing specific procedures that 

prevent a source from violating an applicable portion of the control strategy. In ADEQ's formal 

rulemaking notice, it identified A.A.C. R18-2-306(A)(1) of its existing SIP-approved regulations as 

providing authority to assure that minor sources do not violate applicable portions of the control 

strategy. This regulation requires that each permit issued by the Director ensures compliance with all 

applicable requirements. ADEQ defines applicable requirements to include "any federal applicable 

requirement." The control strategy consist of federally enforceable measures because the measures 

are approved into the SIP. As such, this existing regulation assures compliance with the provisions of 

51.160(a)(1) and (b)(1). EPA's limited disapproval does not explain why this existing regulatory 

provision does not satisfy those requirements.

Response 29:

We agree with the commenter that ADEQ’s program meets this requirement for sources subject to 

ADEQ’s rule R18-2-306. However, not all minor sources under ADEQ’s jurisdiction with emissions at or 

above the permitting exemption threshold for ADEQ’s minor NSR program are subject to R18-2-306. 

Specifically, as explained in our proposal, our limited disapproval based on this issue relates to sources 

that are regulated under ADEQ’s registration program at R18-2-302.01. See 80 FR 14048. Although 
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sources regulated under this program are part of ADEQ’s minor NSR program,37 they are not subject to 

R18-2-306. Therefore, we continue to conclude that this deficiency warrants a limited disapproval and 

in our final action this is one basis for our limited disapproval of the minor NSR program portion of 

ADEQ’s NSR SIP submittal. 

ADEQ’s Portable Source Provisions

Comment 30: 

(Commenter: SRP)

SRP states that EPA should not disapprove ADEQ's portable source provisions because EPA cannot 

substantiate its claim that NA NSR permits are not effectively equivalent to PSD permits. The 

requirements to obtain a NA NSR permit are more rigorous (e.g., obtain offsets), and the control 

technology level is generally more stringent. As such, EPA's basis for disapproving ADEQ's rules for 

referencing NA NSR permits is not sustainable.

SRP agrees that PAL permits are not equivalent to PSD permits, but believes that the point is irrelevant 

to the approvability of the cited provision. If a source complies with its PAL permit, it cannot trigger 

PSD. In this respect, the regulations do not provide an exemption from PSD, because the source is 

already not subject to PSD. 

Response 30:

First, we note that ADEQ’s comments did not object to, disagree with, or address this basis of our 

proposed limited disapproval on this issue. Further, we disagree with SRP’s assertions that NA-NSR 

permit requirements are equivalent to PSD permit requirements at 40 CFR 51.166(j) through (r) and 

therefore sufficient for the purpose of exempting portable stationary sources with a prior NA-NSR 

permit from PSD requirements pursuant to 40 CFR 51.166(i)(1)(iii). While in certain regards the 

requirements for NA-NSR permits are more stringent than those for PSD permits in CFR 51.166(j) 

through (r), this alone does not make NA-NSR permits equivalent to PSD permits. There are several PSD 

requirements that are not applicable to sources subject to NA-NSR review. For example, PSD sources 

must demonstrate that they will not cause or contribute to a violation of the PSD increment, which is 

not addressed in NA-NSR permitting. See 40 CFR 51.166(c), (k)(1)(ii). In addition, PSD permit 

requirements such as BACT and ambient impact analysis potentially apply to each regulated NSR 

pollutant to be emitted by the source, whereas NA-NSR permit requirements such as LAER and 

emission offsets apply solely to the nonattainment pollutant for which the source is a major source. 

See 40 CFR 51.165(a)(2)(i). Accordingly, PSD permits typically contain emission limitations and other 

requirements for several NSR pollutants, but NA-NSR permits generally contain requirements only for 

one or, at most, a few nonattainment pollutants. Given the differences between PSD and NA-NSR 

permit requirements, we are unable to conclude in the absence of a response from ADEQ on this issue 

that NA-NSR permit requirements are equivalent to PSD permit requirements under 40 CFR 

 37 See Response to Comment 28 where we clarify that ADEQ’s registration program is a part of its minor NSR program under 

40 CFR 51.160(e).
Response to Comments

AZ NSR SIP Submittal 

June 2015

Page 41 of 43

51.166(i)(1)(iii). Therefore, we continue to determine that this issue provides a basis for our limited 

disapproval of the ADEQ NSR SIP submittal. 

We also disagree with the commenter’s contention that a portable source with a PAL permit would not 

potentially be subject to PSD upon relocation “because the source is already not subject to PSD.” For 

example, if the PAL limit were taken to avoid a modification at an existing major stationary source 

being considered a major modification, then the major stationary source as a whole would still 

potentially trigger PSD upon relocation as a major stationary source. ADEQ’s program still warrants a 

limited disapproval for this issue.

Minimum Federal Requirements and Minor NSR

Comment 31:

(Commenter: SRP)

One commenter states that ADEQ is statutorily precluded from going beyond the minimum Federal 

requirements, citing Arizona Revised Statutes (ARS) section 49-40838, while other States, for a variety 

of programmatic reasons, may opt to provide more stringent minor NSR programs that go beyond the 

federal minimum requirements. This alone provides a reason why merely comparing programs is 

inappropriate. 

Response 31:

The commenter suggests that ADEQ’s chosen permitting threshold represents a federal minimum 

standard, and that other agencies that regulate more minor sources or minor sources with lower levels 

of emissions under their minor NSR programs are therefore choosing to exceed the federal minimum. 

We disagree with this assertion. 

Even if ADEQ is prohibited under State law39 from going beyond minimum Federal requirements, the 

commenter’s argument is misplaced. The Act does not establish a set of generic federal minimum 

thresholds for new source review of minor stationary sources. As the commenter stated elsewhere, 

each agency implementing the Act’s NSR program for minor sources must determine the sizes and 

types of sources that are necessary to regulate under the minor NSR program to assure the attainment 

and maintenance of the NAAQS for the applicable area. Demonstrating that this assurance is provided 

by the selected sizes and types of sources to be regulated is the requirement that permitting 

authorities must meet under CAA section 110(a)(2)(C) and 40 CFR 51.160(e). Looking at the approach 

of other programs, when the program under review does not provide sufficient analysis, is valid and a 

similar approach was even used by ADEQ in portions of its analysis. As stated in response to comment 

3, our comparison of ADEQ’s program to other programs should not be construed as EPA stating a 

policy preference for a particular agency’s approach. 

 38 See SRP comment at 9 and n. 36. 39 We note that A.R.S. section 49-408 does not appear to apply in this context. We assume that the commenter meant to 

refer to a different State law provision to support its contention in this regard.
Response to Comments

AZ NSR SIP Submittal 

June 2015

Page 42 of 43

ADEQ’s Registration Program and Appendix W

Comment 32: 

(Commenter: SRP)

One commenter states that EPA proposes to disapprove ADEQ's Registration Program because it uses 

SCREEN modeling that EPA asserts does not meet Appendix W. Notably, Appendix W is only a 

"guideline." Nonetheless, that guideline states, "where a preliminary or conservative estimate is 

desired, point source screening techniques are an acceptable approach ... agreement should be 

reached between the model user and the appropriate reviewing authority on the choice of the 

screening model for each analysis ... " ADEQ's SCREEN model which is defined as "AERSCREEN air 

dispersion model published by the Administrator in April 2011" is EPA's recommended screening 

model based on AERMOD. Nevertheless, since sources filing a registration application are outside the 

scope of the minor NSR program, it is not necessary for the Director to follow Appendix W in 

identifying exempt sources that ADEQ will require to go through minor NSR permitting.

Response 32:

40 CFR 51.160(f)(1) provides that air quality modeling for the minor NSR program shall be based on 

“the applicable models, data bases, and other requirements specified in appendix W.” The commenter 

misunderstands our limited disapproval of ADEQ’s program as it relates to Appendix W for sources 

subject to review under ADEQ’s registration program, which is one component of ADEQ’s minor NSR 

program, as discussed in Response to Comment 28. EPA did not propose to disapprove ADEQ’s chosen 

screen model for registration sources or for any other sources subject to ADEQ’s NSR program, and 

EPA agrees that AERSCREEN is currently recommended by EPA for screen modeling. The deficiency is 

that ADEQ’s regulations applicable to its registration program do not require that NSR modeling, 

including screen modeling, conducted for sources subject to the registration program follow Appendix

W, as required by 40 CFR 51.160(f)(1).40 Appendix W contains additional guidelines beyond the type of 

model to use. As such, ADEQ’s registration program must contain a requirement that any modeling 

conducted pursuant to that program, including screen modeling, be consistent with Appendix W. 

Accordingly, we continue to find that this deficiency is a basis for our final limited disapproval of 

ADEQ’s NSR SIP submittal.41

Alternative or Modified Air Models

Comment 33:

(Commenter: ADEQ)

ADEQ stated that EPA’s proposed limited disapproval on the basis that its PSD program does not 

include the public process to be used for alternative or modified air models was incorrect. ADEQ rule 

 40 ADEQ’s regulations for NSR review conducted for larger minor sources subject to Class II permitting and for PSD sources 

include this requirement at R18-2-334(I) and R18-2-406(A)(6), respectively. 41 As noted in our Evaluation, when correcting this deficiency, ADEQ may also want to consider adding a reference to R18-2-

409 to rules R18-2-302.01 and R18-2-334. This would give ADEQ the ability to seek case-by-case approval from EPA of 

alternatives to Appendix W consistent with 40 CFR 51.160(f)(2).
Response to Comments

AZ NSR SIP Submittal 

June 2015

Page 43 of 43

R18-2-409(C) related to air modeling contains a reference to ADEQ’s public participation rules, R18-2-

330. 

Response 33:

Upon further review, we agree with ADEQ that its program adequately meets the requirements for 

public notice of alternative or modified models under 40 CFR 51.102, as required by 40 CFR 

51.166(l)(2), through the requirements in R18-2-409(C). As such, the public notice requirements for 

alternative or modified models do not form a basis for our final limited disapproval.

Extent of Review by EPA

Comment 34: 

(Commenters: ADEQ, SRP) 

ADEQ appreciates EPA’s extraordinarily thorough review and analysis and agrees with the 

overwhelming majority of EPA’s comments. ADEQ has already initiated work on amending the rules to 

reflect EPA’s comments and fully intends to submit the amendments before either the FIP or sanctions 

clock expires. ADEQ believes that the state’s NSR program will be stronger and clearer as a result of 

EPA’s efforts. 

SRP would like to commend EPA on the extensive and thorough review conducted on ADEQ’s NSR SIP 

submittal. SRP is pleased that EPA recognizes that the submitted SIP revisions would substantially 

improve and update ADEQ’s NSR programs compared to the existing SIP - approved programs and 

provide mechanisms for ADEQ to improve air quality for its citizens.

Response 34:

EPA appreciates these comments and is pleased that ADEQ intends to amend its rules to address the 

identified deficiencies in a timely manner. EPA also agrees that ADEQ’s submitted NSR program will 

substantially improve and update ADEQ’s NSR programs compared to the existing SIP-approved 

programs and provide mechanisms for ADEQ to improve air quality for its citizens.