```

[Federal Register Volume 80, Number 211 (Monday, November 2, 2015)]
[Rules and Regulations]
[Pages 67319-67334]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2015-27785]

=======================================================================
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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[EPA-R09-OAR-2015-0187; FRL-9930-43-Region 9]

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

AGENCY: Environmental Protection Agency (EPA).

ACTION: Final rule.

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SUMMARY: The Environmental Protection Agency (EPA) is finalizing a 
limited approval and limited disapproval of, and other actions on, 
revisions to the Arizona Department of Environmental Quality (ADEQ) 
portion of the applicable state implementation plan (SIP) for the State 
of Arizona (State or Arizona) under the Clean Air Act (CAA or Act). 
These revisions submitted by Arizona are primarily intended to serve as 
a replacement of ADEQ's existing SIP-approved rules for the issuance of 
New Source Review (NSR) permits for stationary sources, including 
review and permitting of major and minor sources under the Act. After a 
lengthy stakeholder process, the State submitted a NSR program for SIP 
approval that satisfies most of the applicable CAA and NSR regulatory 
requirements, and which will significantly update ADEQ's existing SIP-
approved NSR program. It also represents an overall strengthening of 
ADEQ's SIP-approved NSR program by clarifying and enhancing the NSR 
requirements for major and minor stationary sources. This final action 
updates the applicable plan while allowing ADEQ to remedy certain 
deficiencies in ADEQ's rules.

DATES: This rule is effective December 2, 2015.

ADDRESSES: EPA has established docket number EPA-R09-OAR-2015-0187 for 
this action. Generally, documents in the docket for this action are 
available electronically at www.regulations.gov and in hard copy at EPA 
Region IX, 75 Hawthorne Street, San Francisco, California. Some docket 
materials, however, may be publicly available only at the hard copy 
location (e.g., voluminous records, maps, copyrighted material), and 
some may not be publicly available in either location (e.g., CBI). To 
inspect the hard copy materials, please schedule an appointment during 
normal business hours with the contact listed in the FOR FURTHER 
INFORMATION CONTACT section.

FOR FURTHER INFORMATION CONTACT: Lisa Beckham, EPA Region 9, (415) 972-
3811, beckham.lisa@epa.gov.

Table of Contents

I. Background
II. The EPA's Evaluation of the SIP Revision
    A. What action is the EPA finalizing?
    B. What changes is the EPA making from its proposed action?
    C. Public Comments and Responses
III. Final Action
IV. Incorporation by Reference
V. Statutory and Executive Order Reviews

    For the purpose of this document, we are giving meaning to certain 
words or initials as follows:

    (i) The words or initials Act or CAA mean or refer to the Clean 
Air Act, unless the context indicates otherwise.
    (ii) The initials ADEQ mean or refer to the Arizona Department 
of Environmental Quality.
    (iii) The initials A.R.S. mean or refer to the Arizona Revised 
Statutes.
    (iv) The initials AQIA mean or refer to air quality impact 
analysis.
    (v) The initials BACT mean or refer to Best Available Control 
Technology.
    (vi) The initials CFR mean or refer to Code of Federal 
Regulations.
    (vii) The initials CO mean or refer to carbon monoxide.
    (viii) The words EPA, we, us or our mean or refer to the United 
States Environmental Protection Agency.
    (ix) The initials FIP mean or refer to Federal Implementation 
Plan.
    (x) The initials GHG mean or refer to greenhouse gas.
    (xi) The initials IBR mean or refer to incorporation by 
reference.
    (xii) The initials LAER mean or refer to Lowest Achievable 
Emissions Rate.
    (xiii) The initials NAAQS mean or refer to National Ambient Air 
Quality Standards.
    (xiv) The initials NA-NSR mean or refer to Nonattainment New 
Source Review.
    (xv) The initials NOX mean or refer to nitrogen oxides.
    (xvi) The initials NSR mean or refer to New Source Review.
    (xvii) The initials PAL mean or refer to Plantwide Applicability 
Limits
    (xviii) The initials PM10 mean or refer to particulate matter 
with an aerodynamic diameter of less than or equal to 10 
micrometers.
    (xix) The initials PM2.5 mean or refer to particulate matter 
with an aerodynamic diameter of less than or equal to 2.5 
micrometers (fine particulate matter).
    (xx) The initials PSD mean or refer to Prevention of Significant 
Deterioration.
    (xxi) The initials PTE mean or refer to potential to emit.
    (xxii) The initials RACT mean or refer to reasonably available 
control technology.
    (xxiii) The initials SER mean or refer to significant emission 
rate.
    (xxiv) The initials SIP mean or refer to State Implementation 
Plan.
    (xxv) The initials SMC mean or refer to significant monitoring 
concentration.
    (xxvi) The initials SO2 mean or refer to sulfur dioxide.
    (xxvii) The initials SRP mean or refer to the Salt River Project 
Agricultural Improvement and Power District.
    (xxviii) The words State or Arizona mean the State of Arizona, 
unless the context indicates otherwise.
    (xxix) The initials TSD mean or refer to the technical support 
document for this action.
    (xxx) The initials VOC mean or refer to volatile organic 
compound.

I. Background

    On March 18, 2015, the EPA provided notice of, and requested public 
comment on, our proposed CAA rulemaking to revise certain portions of 
the Arizona SIP for ADEQ. See 80 FR 14044 (Mar. 18, 2015). We proposed 
action on SIP submittals that comprise ADEQ's updated program for 
preconstruction review and permitting of new or modified stationary 
sources under ADEQ's jurisdiction in Arizona.\1\ The SIP submittals 
that are the subject of this action, referred to herein as the ``NSR 
SIP submittal,'' provide a comprehensive revision to ADEQ's 
preconstruction review and permitting program for stationary sources 
and are intended to satisfy requirements under both part C (prevention 
of significant deterioration) (PSD) and part D (nonattainment new 
source review) of title I of the Act as well as the general 
preconstruction review requirements under section 110(a)(2)(C) of the 
Act.
---------------------------------------------------------------------------

    \1\ These submittals and our current action also address two 
rules and one statutory provision that are not directly related to 
NSR.
---------------------------------------------------------------------------

    As a component of its NSR SIP submittal, ADEQ also requested the 
removal from the Arizona SIP of numerous older rules, as well as one 
Arizona statutory provision, which are mostly superseded by the newer 
provisions that are the subject of this action or by newer provisions 
that have already been approved into the Arizona SIP. Accordingly, our 
action also will remove certain provisions from the Arizona SIP.
    The EPA's rulemaking action on the ADEQ NSR SIP submittal is 
intended to update the applicable SIP consistent with ADEQ's requests, 
while allowing ADEQ to remedy certain deficiencies in

[[Page 67320]]

the submittal where ADEQ's rules do not fully meet CAA requirements. In 
our proposed rulemaking action, we primarily proposed a limited 
approval and limited disapproval, with certain exceptions and additions 
with respect to specific statutory and rule provisions, as follows. We 
proposed partial disapproval of two specific components of ADEQ's NSR 
submittal that we believed were analogous to provisions in the federal 
NSR regulations that had been vacated by federal Courts and that we 
determined were separable from the remainder of the NSR SIP submittal. 
In addition, we proposed a limited approval for a portion of ADEQ's 
nonattainment NSR (NA-NSR) program based on requirements of section 
189(e) of the Act related to the permitting of major sources of 
PM10 and PM2.5 precursors, but did not propose a 
limited disapproval on this basis. For two non-NSR rules for which ADEQ 
requested SIP approval, we also proposed a limited approval and limited 
disapproval. For a non-NSR statutory provision for which ADEQ requested 
SIP approval, A.R.S. Sec.  49-107, we proposed full approval into the 
SIP. Last, we proposed to remove numerous NSR and non-NSR rules from 
the SIP as requested by ADEQ.\2\
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    \2\ See Table 2, which identifies those rules and statutory 
provisions that are being removed from the Arizona SIP. This updated 
table corrects certain typographical errors in the preamble of our 
proposed action. See our discussion of those errors in our responses 
to comments 14-15 in our Response to Comments document.
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    The ADEQ NSR SIP submittal was extensive in scope. We prepared a 
comprehensive Evaluation of the submittal in light of the requirements 
of the CAA and its implementing regulations, and provided a detailed 
discussion of our findings in the Technical Support Document (TSD) for 
our proposed action. Both the Evaluation and the TSD were available in 
the docket for our rulemaking during the public comment period. Our 
proposed rule discussed our analysis and findings, but focused 
primarily on the issues that formed the basis for our limited approval/
limited disapproval of the ADEQ NSR SIP submittal, and referenced the 
TSD for additional information concerning our analysis. The Evaluation 
was an attachment to the TSD.

II. The EPA's Evaluation of the SIP Revision

A. What action is the EPA finalizing?

    The EPA is finalizing a SIP revision for the ADEQ portion of the 
Arizona SIP for the rules and statutory provision listed in Table 1. 
The SIP revision will be codified in 40 CFR 52.120 by incorporating by 
reference the rules and statutory provision in ADEQ's NSR SIP submittal 
as listed in Table 1.\3\ Certain non-regulatory submittals and 
clarifications provided by ADEQ will also be included as part of the 
Arizona SIP in 40 CFR 52.120. In this final action, the EPA is relying, 
in part, on the clarifications and interpretations provided by ADEQ, as 
described in the discussion of our responses to comments in Section 
II.C below.
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    \3\ We listed an incorrect submittal date for certain rules in 
the ADEQ NSR SIP submittal in Table 1 of our proposed action; this 
date is corrected in Table 1 here. See response to comment 13 in our 
Response to Comments document.

                          Table 1--Submitted Statutes and Rules Approved in This Action
----------------------------------------------------------------------------------------------------------------
                                                                                       State
              Rule or statute                               Title                    effective       Submitted
                                                                                       date
----------------------------------------------------------------------------------------------------------------
A.R.S. Sec.   49-107.......................  Local delegation of state authority       8/18/1987       07/2/2014
R18-2-101 [only definitions (2), (32),       Definitions........................      08/07/2012      10/29/2012
 (87), (109), and (122)].
R18-2-217..................................  Designation and Classification of        11/15/1993      10/29/2012
                                              Attainment Areas.
R18-2-218..................................  Limitation of Pollutants in              08/07/2012      10/29/2012
                                              Classified Attainment Areas.
R18-2-301..................................  Definitions........................      08/07/2012      10/29/2012
R18-2-302..................................  Applicability; Registration;             08/07/2012      10/29/2012
                                              Classes of Permits.
R18-2-302.01...............................  Source Registration Requirements...      08/07/2012      10/29/2012
R18-2-303..................................  Transition from Installation and         08/07/2012      10/29/2012
                                              Operating Permit Program to
                                              Unitary Permit Program;
                                              Registration transition; Minor NSR
                                              Transition.
R18-2-304..................................  Permit Application Processing            08/07/2012      10/29/2012
                                              Procedures.
R18-2-306..................................  Permit Contents....................      12/20/1999      10/29/2012
R18-2-306.01...............................  Permits Containing Voluntarily             1/1/2007      10/29/2012
                                              Accepted Emission Limitations and
                                              Standards.
R18-2-306.02...............................  Establishment of an Emissions Cap..      09/22/1999      10/29/2012
R18-2-311..................................  Test Methods and Procedures........      11/15/1993      07/28/2011
R18-2-312..................................  Performance Tests..................      11/15/1993      07/28/2011
R18-2-315..................................  Posting of Permit..................      11/15/1993      10/29/2012
R18-2-316..................................  Notice by Building Permit Agencies.      05/14/1979      10/29/2012
R18-2-319..................................  Minor Permit Revisions.............      08/07/2012      10/29/2012
R18-2-320..................................  Significant Permit Revisions.......      08/07/2012      10/29/2012
R18-2-321..................................  Permit Reopenings; Revocation and        08/07/2012      10/29/2012
                                              Reissuance.
R18-2-323..................................  Permit Transfers...................      02/03/2007      10/29/2012
R18-2-330..................................  Public Participation...............      08/07/2012      10/29/2012
R18-2-332..................................  Stack Height Limitation............      11/15/1993      10/29/2012
R18-2-334..................................  Minor New Source Review............      08/07/2012      10/29/2012
R18-2-401..................................  Definitions........................      08/07/2012      10/29/2012
R18-2-402..................................  General............................      08/07/2012      10/29/2012
R18-2-403..................................  Permits for Sources Located in           08/07/2012      10/29/2012
                                              Nonattainment Areas.
R18-2-404..................................  Offset Standards...................      08/07/2012      10/29/2012
R18-2-405..................................  Special Rule for Major Sources of        08/07/2012      10/29/2012
                                              VOC or Nitrogen Oxides in Ozone
                                              Nonattainment Areas Classified as
                                              Serious or Severe.

[[Page 67321]]

 
R18-2-406..................................  Permit Requirements for Sources          08/07/2012      10/29/2012
                                              Located in Attainment and
                                              Unclassifiable Areas.
R18-2-407 [excluding subsection (H)(1)(c)].  Air Quality Impact Analysis and          08/07/2012      10/29/2012
                                              Monitoring Requirements.
R18-2-409..................................  Air Quality Models.................      11/15/1993      10/29/2012
R18-2-412..................................  PALs...............................      08/07/2012      10/29/2012
----------------------------------------------------------------------------------------------------------------

    In addition, this final action removes the rules and appendices 
listed in Table 2 from the ADEQ portion of the Arizona SIP.

                    Table 2--SIP Rules and Appendices Removed From Arizona SIP in This Action
----------------------------------------------------------------------------------------------------------------
                                                                                                      Federal
              Rule or appendix                              Title                  EPA  approval     Register
                                                                                       date          citation
----------------------------------------------------------------------------------------------------------------
R9-3-101 [excluding subsection (20)].......  Definitions........................         Various         Various
R9-3-217(B)................................  Attainment Areas: Classification         04/23/1982     47 FR 17483
                                              and Standards.
R9-3-301, [excluding subsections (I), (K)].  Installation Permits: General......      05/03/1983     48 FR 19878
R9-3-302...................................  Installation Permits in                  08/10/1988     53 FR 30220
                                              Nonattainment Areas.
R9-3-303...................................  Offset Standards...................      08/10/1988     53 FR 30220
R9-3-304, [excluding subsection (H)].......  Installation Permits in Attainment       05/03/1983     48 FR 19878
                                              Areas.
R9-3-305...................................  Air Quality Analysis and Monitoring      05/03/1983     48 FR 19878
                                              Requirements.
R9-3-306...................................  Source Registration Requirements...      05/03/1983     48 FR 19878
R9-3-307...................................  Replacement........................      05/05/1982     47 FR 19326
R9-3-308...................................  Permit Conditions..................      04/23/1982     47 FR 17483
R9-3-310...................................  Test Methods and Procedures........      10/19/1984     49 FR 41026
R9-3-311...................................  Air Quality Models.................      04/23/1982     47 FR 17483
R9-3-312...................................  Performance Tests..................      04/23/1982     47 FR 17483
R9-3-314...................................  Excess Emissions Reporting.........      04/23/1982     47 FR 17483
R9-3-315...................................  Posting of Permits.................      04/23/1982     47 FR 17483
R9-3-316...................................  Notice by Building Permit Agencies.      04/23/1982     47 FR 17483
R9-3-317...................................  Permit Non-transferrable; Exception      04/23/1982     47 FR 17483
R9-3-318...................................  Denial or Revocation of                  04/23/1982     47 FR 17483
                                              Installation or Operating Permit.
R8-3-319...................................  Permit Fees........................      04/23/1982     47 FR 17483
R9-3-322...................................  Temporary Conditional Permits......      10/19/1984     49 FR 41026
R9-3-1101..................................  Jurisdiction.......................      05/03/1983     48 FR 19878
Appendix 4.................................  Fee Schedule for Installation and        09/19/1977     42 FR 46926
                                              Operating Permits.
Appendix 5.................................  Fee Schedule for Conditional             09/19/1977     42 FR 44926
                                              Permits.
----------------------------------------------------------------------------------------------------------------

    In summary, this action is primarily a limited approval and limited 
disapproval of a SIP submittal from Arizona for the ADEQ portion of the 
Arizona SIP that governs preconstruction review and the issuance of 
preconstruction permits for stationary sources, including the review 
and permitting of new major sources and major modifications under parts 
C and D of title I of the CAA as well as review of new and modified 
minor sources. The intended effect of our final limited approval and 
limited disapproval action is to update the applicable SIP with current 
ADEQ regulations, while allowing ADEQ to remedy the identified 
deficiencies in these regulations. We are also removing at ADEQ's 
request certain rules and appendices from the Arizona SIP, which are 
outdated and which are mostly being superseded by this action. In 
addition, we are finalizing a partial disapproval of one provision in 
ADEQ's NSR program that has been vacated by the courts. We are 
finalizing a limited approval of ADEQ's NA-NSR program for certain 
nonattainment areas based on requirements under section 189 of the Act 
related to PM10 and PM2.5 precursors (without a 
limited disapproval on this basis). Last, we are finalizing a limited 
approval and limited disapproval of two ADEQ non-NSR rules relating to 
test methods and procedures and performance tests, and finalizing the 
approval of an Arizona statutory provision relating to local delegation 
of state authority.
    We are finalizing the above-described action because, although we 
find that the new and amended rules submitted by ADEQ meet most of the 
applicable CAA requirements for preconstruction review programs and 
other CAA requirements, and that overall the SIP revisions improve and 
strengthen the existing SIP, we have found certain deficiencies that 
prevent full approval, as explained in our proposed action and in the 
TSD for this rulemaking, and in this final action and our Response to 
Comments document.
    We reviewed the ADEQ NSR SIP submittal in accordance with 
applicable CAA requirements, primarily including those that apply to: 
(1) General preconstruction review programs, including for minor 
sources, under section 110(a)(2)(C) of the Act; (2) PSD permit programs 
under part C of title I of the Act; and (3) NA-NSR permit programs 
under part D of title I of the Act. For the most part, ADEQ's submittal 
satisfies the applicable CAA requirements, including those for these 
preconstruction review programs, and our approval will strengthen the 
applicable SIP by updating the

[[Page 67322]]

regulations and adding provisions to address new or revised federal NSR 
permitting and other requirements. However, the submitted rules also 
contain specific deficiencies and inconsistencies with CAA requirements 
that prevent us from granting full SIP approval. These deficiencies 
form the basis for our limited approval and limited disapproval action, 
and for our partial disapproval of one rule provision.

B. What changes is the EPA making from its proposed action?

    We are largely finalizing our action as proposed. However, in 
response to public comments we received, our final action differs in 
some respects from our proposed action. For certain deficiencies 
identified in our proposal as bases for limited disapproval, we have 
changed our determination and no longer find that these are bases for 
our limited disapproval. In addition, we have changed our determination 
concerning one of the ADEQ rule provisions for which we had proposed 
partial disapproval; we are not finalizing our partial disapproval of 
this provision.
    Specifically, the following issues that had been identified in our 
proposed action as bases for limited disapproval are not a basis for 
our final limited disapproval: (1) ADEQ's use of the term ``proposed 
final permit'' in its rules for the minor NSR, PSD and NA-NSR programs; 
(2) a question concerning whether ADEQ rule R18-2-334(E) requires ADEQ 
to review potential impacts on the attainment and maintenance of the 
National Ambient Air Quality Standards (NAAQS) for all minor sources 
subject to new source review under ADEQ rule R18-2-334;\4\ (3) the lack 
of a definition in ADEQ's PSD regulations for the term ``subject to 
regulation;'' (4) the lack of a reference in ADEQ's PSD rules to 
pollutants subject to regulation in the definition of ``regulated NSR 
pollutant,'' per 40 CFR 51.166(b)(49)(iv); (5) the lack of certain 
language in ADEQ's PSD rules concerning condensable particulate matter, 
per 40 CFR 51.166(b)(49)(i); (6) potential ambiguity as to whether 
references to the undefined term ``Arizona Ambient Air Quality 
Standards'' in ADEQ's NSR regulations refer to ADEQ's Article 2 air 
quality standards; (7) language concerning the calculation of baseline 
actual emissions under ADEQ's plantwide applicability limits (PALs) 
provisions for the PSD and NA-NSR programs; and (8) public notice 
requirements for alternative or modified air modeling under ADEQ's 
rules for the PSD program. In addition, we are not finalizing a partial 
disapproval of ADEQ's definition for ``basic design parameter.'' We now 
find the ADEQ NSR SIP submittal approvable with respect to these 
particular issues. Our rationale for changing our determination on 
these issues is included in our Response to Comments document for this 
action, and some of these issues are also discussed in the Public 
Comments and Responses section below.
---------------------------------------------------------------------------

    \4\ Due to a typographical error, in discussing this issue, the 
notice for our proposed action inadvertently referenced subsection 
(G) of R18-2-334 instead of subsection (E).
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    In addition, we are making three technical corrections to address 
typographical errors, as noted by commenters: (1) Correction of SIP 
submittal dates listed in Table 1 (listing the rules and statutory 
provisions that we are approving into the SIP) so that ``10/29/2012'' 
is listed instead of ``10/29/2014,'' (2) correction of Table 2 (the 
list of rules and appendices that we are removing from the SIP) to 
exclude subsection (20) from the provisions of ADEQ rule R9-3-101 that 
we are removing from the SIP, and (3) the addition of ADEQ rules R9-3-
310 and R9-3-312 to the list of rules in Table 2. Additional detail 
regarding these technical corrections is provided in response to 
comments 13 through 15 in our Response to Comments document.

C. Public Comments and Responses

    Our March 18, 2015 proposed rule included a 30-day public comment 
period that ended on April 17, 2015. We received 3 written comments, 
one each from the Office of Robert Ukeiley, the Salt River Project 
Agricultural Improvement and Power District (SRP), and ADEQ. Copies of 
each comment have been added to the docket for this action and are 
accessible at www.regulations.gov. Our Response to Comments document in 
the docket for this action contains a summary of all comments received 
and the EPA's responses to the comments. Below we provide the major 
issues raised by commenters and our responses to those comments.
    Comment 1:
    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. The EPA must disapprove this rule if it does not include 
the PM2.5 increments.
    Response 1:
    In the 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.\5\
---------------------------------------------------------------------------

    \5\ 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 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.
---------------------------------------------------------------------------

    Comment 2:
    ADEQ states that its methodology for establishing minor NSR 
thresholds was valid for all areas under ADEQ's jurisdiction. The CAA 
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 the EPA's proposed Tribal NSR Rule, ADEQ states that in the 
past, the 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.'' \6\ In 
creating a federal minor NSR program for Indian Country, the EPA 
emphasized the importance of a cost-effective plan, as well as one that 
reduces the burden on sources and reviewing authorities.
---------------------------------------------------------------------------

    \6\ 71 FR 48696, 48701 (Aug. 21, 2006).
---------------------------------------------------------------------------

    ADEQ set an adequate, yet cost-effective threshold level of one 
half the significant emission rate (SER) for nonattainment areas. Just 
as the 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

[[Page 67323]]

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.\7\ Scenario 1 illustrates the impact of a minor threshold of 
one half the SER and Scenario 2 illustrates the impact of a threshold 
set at one quarter the SER. Lowering the threshold beyond one half the 
SER 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.
---------------------------------------------------------------------------

    \7\ The 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.
---------------------------------------------------------------------------

    ADEQ illustrated this statement through a figure provided in its 
comments showing a comparison of potential threshold levels and 
relative impact, by pollutant.\8\ The figure compares the percent of 
emissions regulated with the percent of sources regulated at the two 
NSR exemption scenarios 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.
---------------------------------------------------------------------------

    \8\ See ADEQ's April 17, 2015 comment letter at 14.
---------------------------------------------------------------------------

    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. The 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 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 NSR exemption thresholds 
selected by the 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.\9\
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    \9\ We note that the reasoning the EPA provides in these 
responses to comments concerning NSR exemption thresholds in 
nonattainment areas would apply equally to our review of the basis 
for NSR exemption thresholds for PM2.5 in nonattainment 
areas.
---------------------------------------------------------------------------

    ADEQ's comments focus largely on the argument that expanding its 
minor

[[Page 67324]]

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 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 68758.
    We recognize that the reference that the 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 the 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 NSR 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 NSR 
exemption thresholds are expected to make with respect to attainment 
and maintenance of the NAAQS in nonattainment areas.
    In addition, we wish to clarify that while the 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. The 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.''
    Comment 3:
    SRP and ADEQ state that the 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. The EPA's objection appears to be based on its own policy 
preferences, and the EPA simply lacks authority to substitute its 
preferences for those of the State. The EPA points to no flaws in the 
reasoning behind the analysis, nor does the 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 CAA. At 
page 14049 n. 12 of the proposal, which accompanied a generalized 
comparison to other states, the EPA referenced threshold levels for 
Sacramento, California. It is erroneous for the EPA to compare 
Arizona's minor NSR program with that of California, due to the 
extraordinary severity of the nonattainment problems in California. The 
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 the EPA has advanced no reason for 
concluding that ADEQ's analysis is any less valid for nonattainment 
areas than it is for attainment areas.

[[Page 67325]]

    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 a policy preference by the EPA 
to regulate ``more'' sources in nonattainment areas. As explained in 
detail in our response to comment 2, the 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 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.\10\
---------------------------------------------------------------------------

    \10\ We addressed the comment concerning the reference in the 
EPA's proposal to regulation of a ``sufficient percentage of minor 
sources'' in our response to comment 2.
---------------------------------------------------------------------------

    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 policy choice of the EPA in 
this regard. 80 FR at 14049 and n. 13. See also response to comment 2. 
The 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, the 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, the EPA's analysis for the Tribal Minor NSR program, 
cited by ADEQ in its analysis, demonstrated that the 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 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, the 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.\11\
---------------------------------------------------------------------------

    \11\ 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 the EPA to reach the 
conclusion that the NSR 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.
---------------------------------------------------------------------------

    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 
the 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, the 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 the EPA's Tribal Minor NSR rule, which were also 
referenced in our proposed action).\12\ 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.
---------------------------------------------------------------------------

    \12\ 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.
---------------------------------------------------------------------------

    In sum, the EPA did not conclude that ADEQ's NSR exemption 
thresholds are necessarily deficient, or suggest that some other 
agency's threshold must be applied. The 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.
    Comment 4:
    ADEQ submitted comments related to the 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

[[Page 67326]]

forwards to the EPA for review under the title V program for title V 
sources--is to ensure that Arizona's unitary permit 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 the EPA's 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 the EPA's review of the title V permit or permit revision 
occurred.
    ADEQ specifically takes issue with the 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 FR at 14048. ADEQ states that this objection is invalid for 
two reasons. First, 40 CFR 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'' the EPA appears to mean subject to 
administrative and judicial review. See 80 FR at 14053. The 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 FR 
at 14048.
    The 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. Sec.  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 Sec.  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:
    The 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.
    The 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).\13\
---------------------------------------------------------------------------

    \13\ 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 the EPA or by a State under a SIP-approved or delegated PSD 
program. See 80 FR 14053.
---------------------------------------------------------------------------

    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 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.'' \14\
---------------------------------------------------------------------------

    \14\ 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.
---------------------------------------------------------------------------

    The 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.'' \15\ 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.
---------------------------------------------------------------------------

    \15\ See June 8, 2015 email ``Clarification of ADEQ's Comments 
on the EPA's Proposed Action'' from Eric C. Massey, Air Quality 
Division Director at ADEQ to Lisa Beckham, Air Permits Office, EPA 
Region 9.
---------------------------------------------------------------------------

    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 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

[[Page 67327]]

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.
    Comment 5:
    ADEQ disagrees with the 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 the 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 
the 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 the EPA or a tribe with delegated authority) discretion 
to conduct an AQIA. 40 CFR 51.154(c) and (d). ADEQ also cites to the 
EPA's response to comments for the Tribal Minor NSR Rule where the 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 
the 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 the 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 the 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 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 the 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 the EPA's proposed disapproval based on the 
EPA's finding that the Director's discretion under R-18-2-334(E) was 
too great, and asserts that the EPA's proposed action conflicts with 
the 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.\16\ 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).'' \17\ 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.
---------------------------------------------------------------------------

    \16\ The EPA's proposal inadvertently referred to R18-2-334(G) 
instead of R18-2-334(E) when describing this issue.
    \17\ 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.
---------------------------------------------------------------------------

    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 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

[[Page 67328]]

criteria ADEQ will be applying when making its determination under R18-
2-334(E) do not afford undue discretion to the Director.
    Comment 6:
    One commenter takes issue with the EPA's statements that finalizing 
its proposed limited disapproval would trigger an obligation for the 
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 the 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 
the 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 Region 6 of the 
EPA 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 the 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 the EPA's proposed 
action are not mandatory. The commenter further argues that the 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 the 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 a FIP or sanctions.
    Response 6:
    The EPA disagrees with the commenter's statement that the EPA's 
limited disapproval in this action does not trigger a FIP clock or 
potential sanctions, and disagrees that the EPA's action is 
inappropriate in light of this result.
    The 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 the EPA approves the related 
SIP revisions within 2 years, and that sanctions would be triggered by 
the 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 the 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 the 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, the 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 the 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 the EPA has not issued a SIP call under CAA section 
110(k)(5),\18\ a FIP is generally required under CAA section 110(c)(1) 
when the EPA disapproves a plan submission, unless the State adequately 
corrects the basis for the disapproval and the EPA approves a corrected 
SIP submittal in a timely manner, or the 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 Sec. Sec.  110(a)(2)(C), 161, 165, 172(c)(5), 173; 40 CFR 
51.160-51.166.
---------------------------------------------------------------------------

    \18\ There is no existing SIP call under CAA section 110(k)(5) 
that specifically pertains to the deficiencies with ADEQ's NSR 
program.
---------------------------------------------------------------------------

    In this case, the 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 
the EPA to promulgate a FIP. As we made clear in the notice for our 
proposed action,\19\ ADEQ's NSR SIP submittal included the removal of 
most of ADEQ's existing NSR program elements from the Arizona SIP.\20\ 
Upon our final action,\21\ there will not be an ``existing plan'' that 
could potentially satisfy the specific CAA NSR requirements that the 
EPA has determined are not satisfied in ADEQ's NSR SIP submittal.\22\ 
In general, the

[[Page 67329]]

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.'' The 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 the EPA 
has found specific deficiencies in ADEQ's updated NSR program.\23\
---------------------------------------------------------------------------

    \19\ See 80 FR at 14046-14047.
    \20\ See October 29, 2012 ADEQ submittal at 4 and Table 2-1; see 
also ADEQ's February 23, 2015 supplemental submittal at 3-7.
    \21\ We note that the EPA's limited approval/limited disapproval 
of ADEQ's NSR SIP submission allows ADEQ to use its updated NSR 
rules, to the extent the 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 the 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.
    \22\ The commenter asserts that when the EPA disapproved 
elements of the Texas Commission of Environmental Quality's (TCEQ's) 
major NSR rule, the 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 action in Region 6 did not. The EPA 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, the 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.
    \23\ 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.
---------------------------------------------------------------------------

    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.
    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 the EPA has not issued a SIP call under CAA section 
110(k)(5), sanctions generally will apply under CAA section 179 when 
the EPA disapproves a plan submission based on plan deficiencies that 
relate to title I, Part D requirements, unless ADEQ adequately corrects 
those deficiencies and the EPA takes action to approve a corrected plan 
submittal before the sanctions apply, or the 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 Sec. Sec.  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 the EPA's final action there will not be older NA-NSR SIP 
provisions that could potentially meet the CAA NA-NSR requirements that 
the EPA has determined are not satisfied in the NA-NSR program in 
ADEQ's NSR SIP submittal. The 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 the 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 the 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.
    The 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.\24\ 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.
---------------------------------------------------------------------------

    \24\ 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.
---------------------------------------------------------------------------

    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, the 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.
    Comment 7:
    SRP states that to proceed using the limited approval, limited 
disapproval mechanism, The EPA must make an on-the-record determination 
that the disapproved elements are not severable from the approved 
elements. The EPA has not made this finding or provided this 
explanation in its proposed notice.
    Response 7:
    The EPA disagrees with this comment. The commenter cites no 
authority for this unsupported proposition. Under CAA sections 
110(k)(3) and 301(a) and the 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

[[Page 67330]]

portion of a plan submittal meets all applicable CAA requirements. The 
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 SMC 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.
    Comment 8:
    One commenter states that the EPA's assertion that ADEQ may not 
exclude certain pollutant-emitting activities from PSD misinterprets 
the 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).
    Comment 9:
    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. The 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 the 
EPA's own interpretation of ``malfunctions'' and is no less stringent 
than the federal definition. The 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.\25\ Moreover, the 
comparable paragraph in the Federal definition of ``projected actual 
emissions'' merely clarifies that projected actual emissions includes 
all post-change emissions. The 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.
---------------------------------------------------------------------------

    \25\ See, e.g., The EPA's approval of Georgia's PSD program, 
Georgia's PSD program at 391-3-1; and the EPA's approval of South 
Carolina's regulation at Chapter 7 Regulation 62.5.
---------------------------------------------------------------------------

    Response 9:
    The commenter asserts that the 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 the 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 the 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

[[Page 67331]]

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 the 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 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 
the 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 the EPA approval for excluding 
malfunction emissions from both the definition of baseline actual 
emissions and projected actual emissions.
    Notwithstanding prior action by the EPA in the context of SIPs in 
the distinct circumstances noted above, the 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.
    Comment 10:
    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.
    Comment 11:
    The 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,'' the 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--the EPA 
did not intend for codification of ``subject to regulation'' to be a 
necessary element for SIP approval. See 75 FR 31514 at 31525. The EPA 
chose the ``subject to regulation'' pathway because it determined that 
this would allow other states to adopt the 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 the EPA may regulate in the future. Should the EPA 
regulate such an air pollutant in the future, the EPA may follow the 
pathway it used for 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 the 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, the EPA has separately taken action to address 
this deficiency. The 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.
    Comment 12:
    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 the EPA codified the 
replacement unit provisions, the 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 the EPA's stated interpretation of that 
phrase for purposes of the replacement unit provisions. Accordingly, 
the EPA's statements in the preamble remain its interpretation for 
purposes of implementing those provisions. ADEQ's definition is fully 
consistent with the EPA's interpretation.
    Response 12:
    The 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 the 
EPA's past statements related to this term.

[[Page 67332]]

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

III. Final Action

    Pursuant to section 110(k) of the CAA, the EPA is finalizing a 
limited approval and limited disapproval of the ADEQ rules listed in 
Table 1 above. We are also approving into the Arizona SIP the Arizona 
statutory provision relating to local delegation of state authority 
identified in Table 1 above. In addition, we are removing from the 
Arizona SIP certain rules and appendices, which are outdated and mostly 
being superseded by this action. See Table 2 above. We are also 
finalizing a partial disapproval of one provision of ADEQ's NSR SIP 
submittal concerning the PM2.5 SMC, as the analogous federal 
regulatory provision has been vacated by a federal Court.\26\ Last, we 
are finalizing a limited approval (but not a limited disapproval) based 
on requirements under section 189 of the Act related to PM10 
and PM2.5 precursors for ADEQ's nonattainment NSR program 
for the Nogales and West Central Pinal PM2.5 nonattainment 
areas and the West Pinal PM10 nonattainment area.
---------------------------------------------------------------------------

    \26\ The EPA's partial disapproval concerning the 
PM2.5 SMC does not require follow-up action by ADEQ. 
However, for clarity, ADEQ may wish to remove this disapproved 
provision from its regulations.
---------------------------------------------------------------------------

    Our limited approval and limited disapproval action will approve 
the updated rules included in the ADEQ NSR SIP submittal into the ADEQ 
portion of the Arizona SIP.\27\ However, ADEQ must correct certain 
deficiencies in the approved rules in order to obtain full approval for 
its NSR SIP submittal. Our TSD and proposal for this action described 
in detail the deficiencies we identified with ADEQ's NSR SIP submittal 
which we determined were bases for limited approval and limited 
disapproval. With the exception of the changes we are making from our 
proposal as described in section II.B of this preamble, we are 
finalizing our action as proposed. For some of these disapproval 
issues, no adverse comment was received during the public comment 
period on our proposed action; where comments were received on these 
issues, we addressed the comments in our Response to Comments document. 
See section C of this preamble. A list summarizing the bases for our 
limited disapproval is included in a memorandum to the file for this 
action.\28\
---------------------------------------------------------------------------

    \27\ This excludes the PM2.5 SMC provision for which 
we issuing a partial disapproval, as discussed elsewhere in this 
action.
    \28\ ``List of Bases for Final Limited Disapproval of ADEQ NSR 
SIP Submittal,'' Lisa Beckham, Air Permits Office, EPA Region 9, 
June 22, 2015.
---------------------------------------------------------------------------

    Our limited disapproval action will trigger an obligation on the 
EPA to promulgate a FIP unless Arizona corrects the deficiencies that 
are the bases for the limited disapproval, and the EPA approves the 
related plan revisions, within two years of the final action. 
Additionally, for those deficiencies that are bases for our limited 
disapproval that relate to NA-NSR requirements under part D of title I 
of the Act, the offset sanction in CAA section 179(b)(2) would apply in 
the nonattainment areas under ADEQ's jurisdiction 18 months after the 
effective date of a final limited disapproval, and the highway funding 
sanctions in CAA section 179(b)(1) would apply in these areas six 
months after the offset sanction is imposed. Neither sanction will be 
imposed under the CAA if Arizona submits, and we approve, prior to the 
implementation of the sanctions, SIP revisions that correct the 
deficiencies that we identify in our final action.\29\ We intend to 
work with ADEQ to correct the deficiencies identified in this action in 
a timely manner.
---------------------------------------------------------------------------

    \29\ In addition, ADEQ must also address our limited approval 
under section 189 of the Act related to PM10 and 
PM2.5 precursors for the Nogales and West Central Pinal 
PM2.5 nonattainment areas and the West Pinal 
PM10 nonattainment area. However, because this issue is 
not a basis for our limited disapproval action, it does not trigger 
a FIP clock or the potential for sanctions.
---------------------------------------------------------------------------

IV. Incorporation by Reference

    In this rule, the EPA is finalizing regulatory text that includes 
incorporation by reference. In accordance with requirements of 1 CFR 
51.5, the EPA is finalizing the incorporation by reference of the ADEQ 
rules and the statutory provision described in the amendments to 40 CFR 
part 52 set forth below. The EPA has made, and will continue to make, 
these documents available electronically through www.regulations.gov 
and in hard copy at the appropriate EPA office (see the ADDRESSES 
section of this preamble for more information).

V. Statutory and Executive Order Reviews

A. Executive Order 12866, Regulatory Planning and Review and Executive 
Order 13563, Improving Regulation and Regulatory Review

    This action is not a ``significant regulatory action'' under the 
terms of Executive Order 12866 (58 FR 51735, October 4, 1993) and is 
therefore not subject to review under Executive Orders 12866 and 13563 
(76 FR 3821, January 21, 2011).

B. Paperwork Reduction Act

    This action does not impose an information collection burden under 
the provisions of the Paperwork Reduction Act, 44 U.S.C. 3501 et seq. 
Burden is defined at 5 CFR 1320.3(b).

C. Regulatory Flexibility Act

    The Regulatory Flexibility Act (RFA) generally requires an agency 
to conduct a regulatory flexibility analysis of any rule subject to 
notice and comment rulemaking requirements unless the agency certifies 
that the rule will not have a significant economic impact on a 
substantial number of small entities. Small entities include small 
businesses, small not-for-profit enterprises, and small governmental 
jurisdictions.
    This rule will not have a significant impact on a substantial 
number of small entities because SIP approvals or disapprovals under 
section 110 and subchapter I, part D of the Clean Air Act do not create 
any new requirements but simply approve or disapprove requirements that 
the State is imposing. Therefore, because this action does not create 
any new requirements, I certify that this action will not have a 
significant economic impact on a substantial number of small entities.
    Moreover, due to the nature of the Federal-State relationship under 
the Clean Air Act, preparation of flexibility analysis would constitute 
Federal inquiry into the economic reasonableness of State action. The 
Clean Air Act forbids the EPA to base its actions concerning SIPs on 
such grounds. Union Electric Co., v. U.S. EPA, 427 U.S. 246, 255-66 
(1976); 42 U.S.C. 7410(a)(2).

D. Unfunded Mandates Reform Act

    The EPA has determined that this action does not include a Federal 
mandate that may result in estimated costs of $100 million or more to 
either State, local, or tribal governments in the aggregate, or to the 
private sector. This Federal action approves or disapproves pre-
existing requirements under State or local law, and imposes no new 
requirements.

E. Executive Order 13132, Federalism

    This action does not have federalism implications. It will not have 
substantial direct effects on the states, on the relationship between 
the national government and the states, or in the distribution of power 
and

[[Page 67333]]

responsibilities among the various levels of government, as specified 
in Executive Order 13132.

F. Executive Order 13175, Coordination With Indian Tribal Governments

    Executive Order 13175, entitled ``Consultation and Coordination 
with Indian Tribal Governments'' (65 FR 67249, November 9, 2000), 
requires the EPA to develop an accountable process to ensure 
``meaningful and timely input by tribal officials in the development of 
regulatory policies that have tribal implications.'' This final rule 
does not have tribal implications, as specified in Executive Order 
13175. It will not have substantial direct effects on tribal 
governments, on the relationship between the Federal government and 
Indian tribes, or on the distribution of power and responsibilities 
between the Federal government and Indian tribes. The SIP is not 
approved to apply on any Indian reservation land or in any other area 
where the EPA or an Indian tribe has demonstrated that a tribe has 
jurisdiction. In those areas of Indian country, the rule does not have 
tribal implications and will not impose substantial direct costs on 
tribal governments or preempt tribal law as specified by Executive 
Order 13175. Thus, Executive Order 13175 does not apply to this rule.

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

    The EPA interprets Executive Order 13045 (62 FR 19885, April 23, 
1997) as applying only to those regulatory actions that concern health 
or safety risks, such that the analysis required under section 5-501 of 
the Executive Order has the potential to influence the regulation. This 
rule is not subject to Executive Order 13045, because it approves or 
disapproves State rules intended to implement a Federal standard.

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

    This rule is not subject to Executive Order 13211, ``Actions 
Concerning Regulations That Significantly Affect Energy Supply, 
Distribution, or Use'' (66 FR 28355, May 22, 2001) because it is not a 
significant regulatory action under Executive Order 12866.

I. National Technology Transfer and Advancement Act

    Section 12 of the National Technology Transfer and Advancement Act 
(NTTAA) of 1995 requires Federal agencies to evaluate existing 
technical standards when developing a new regulation. To comply with 
NTTAA, the EPA must consider and use ``voluntary consensus standards'' 
(VCS) if available and applicable when developing programs and policies 
unless doing so would be inconsistent with applicable law or otherwise 
impractical.
    The EPA believes application of VCS to this action would be 
inconsistent with the Clean Air Act.

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

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

K. Congressional Review Act

    The Congressional Review Act, 5 U.S.C. 801 et seq., as added by the 
Small Business Regulatory Enforcement Fairness Act of 1996, generally 
provides that before a rule may take effect, the agency promulgating 
the rule must submit a rule report, which includes a copy of the rule, 
to each House of the Congress and to the Comptroller General of the 
United States. The EPA will submit a report containing this rule and 
other required information to the U.S. Senate, the U.S. House of 
Representatives, and the Comptroller General of the United States prior 
to publication of the rule in the Federal Register. A major rule cannot 
take effect until 60 days after it is published in the Federal 
Register. This action is not a ``major rule'' as defined by 5 U.S.C. 
804(2).

L. Petitions for Judicial Review

    Under section 307(b)(1) of the Clean Air Act, petitions for 
judicial review of this action must be filed in the United States Court 
of Appeals for the appropriate circuit by January 4, 2016. Filing a 
petition for reconsideration by the Administrator of this final rule 
does not affect the finality of this rule for the purposes of judicial 
review nor does it extend the time within which a petition for judicial 
review may be filed, and shall not postpone the effectiveness of such 
rule or action. This action may not be challenged later in proceedings 
to enforce its requirements (see CAA section 307(b)(2)).

List of Subjects in 40 CFR Part 52

    Air pollution control, Carbon monoxide, Environmental protection, 
Greenhouse gases, Incorporation by reference, Intergovernmental 
relations, Nitrogen dioxide, Ozone, Particulate matter, Reporting and 
recordkeeping requirements, Sulfur oxides, Volatile organic compounds.

    Dated: June 29, 2015.
Jared Blumenfeld,
Regional Administrator, Region IX.

    40 CFR part 52 is amended as follows:

PART 52--APPROVAL AND PROMULGATION OF IMPLEMENTATION PLANS

0
1. The authority citation for part 52 continues to read as follows:

    Authority:  42 U.S.C. 7401 et seq.

0
2. Section 52.120 is amended:
0
a. By revising paragraphs (c)(27)(i)(C), (c)(43)(i)(C), (c)(45)(i)(D).
0
b. By adding paragraph (c)(47)(i)(A)(1).
0
c. By revising paragraph (c)(50)(i)(C).
0
d. By revising paragraph (c)(54)(i)(E).
0
e. By adding paragraph (c)(54)(i)(H).
0
f. By revising paragraph (c)(56)(i)(C).
0
g. By adding paragraphs (c)(59)(i)(A)(2) and (c)(161)(i)(A)(6).
0
h. By revising the introductory text of paragraph (c)(162)
0
i. By adding paragraphs (c)(162)(i)(A)(3) and (4), and (c)(162)(ii).
    The revisions and additions read as follows:

Sec.  52.120  Identification of plan.

* * * * *
    (c) * * *
    (27) * * *
    (i) * * *
    (C) Previously approved in paragraphs (c)(27)(i)(A) and (B) of this 
section and now deleted without replacement: R9-3-101 (all paragraphs 
and nos. listed), paragraph B of R9-3-217, R9-3-301 (all paragraphs 
listed), R9-3-306 (all paragraphs listed), R9-3-307 (all paragraphs 
listed), R9-3-308, R9-3-310 (Paragraph C), R9-3-311 (Paragraph A), R9-
3-312, R9-3-314, R9-3-315, R9-3-316, R9-3-317, R9-3-318, R9-3-518 
(Paragraphs B and C), R9-3-319, R9-3-1101, and Appendix 10 (Sections

[[Page 67334]]

A10.1.3.3, A10.1.4 and A10.2.2 to A10.3.4).
* * * * *
    (43) * * *
    (i) * * *
    (C) Previously approved in paragraphs (c)(43)(i)(A) and (B) of this 
section and now deleted without replacement: R9-3-101 (all paragraphs 
and nos. listed), R9-3-301 (all paragraphs listed), R9-3-302 (all 
paragraphs listed), R9-3-303, R9-3-306 (all paragraphs listed), R9-3-
307 (all paragraphs listed), and R9-3-518 (Paragraph A.1 to A.5).
* * * * *
    (45) * * *
    (i) * * *
    (D) Previously approved in paragraphs (c)(45)(i)(A) and (B) of this 
section and now deleted without replacement: R9-3-101 (all paragraphs 
and nos. listed), R9-3-301 (all paragraphs listed), R9-3-306 (all 
paragraphs listed), R9-3-311 (all paragraphs listed), R9-3-509, and 
Appendix 10 (Sections A10.2 and A10.2.1).
* * * * *
    (47) * * *
    (i) * * *
    (A) * * *
    (1) Previously approved in this paragraph (c)(47)(i)(A) and now 
deleted without replacement: R9-3-101 (all paragraphs and nos. listed).
* * * * *
    (50) * * *
    (i) * * *
    (C) Previously approved in paragraph (c)(50)(i)(A) of this section 
and now deleted without replacement: R9-3-310 (Paragraphs A and B) and 
Appendix 10 (Sections A10.1-A10.1.3.2).
* * * * *
    (54) * * *
    (i) * * *
    (E) Previously approved in paragraphs (c)(54)(i)(B) and 
(c)(54)(i)(C) of this section and now deleted without replacement: R9-
3-101 (all nos. listed except no. 20).
* * * * *
    (H) Previously approved in paragraphs (c)(54)(i)(B), (C), and (D) 
of this section and now deleted without replacement: R9-3-301 (all 
paragraphs except paragraphs I and K), R9-3-302 (all paragraphs 
listed), R9-3-303 (all paragraphs listed), R9-3-304 (all paragraphs 
except paragraph H), R9-3-305, R9-3-306 (paragraph A only), and R9-3-
1101 (all paragraphs listed).
* * * * *
    (56) * * *
    (i) * * *
    (C) Previously approved in paragraphs (c)(56)(i)(A) and (B) of this 
section and now deleted without replacement: R9-3-101 (Nos. 135 and 
157), R9-3-218, R9-3-310, R9-3-322, R9-3-1101 and Appendix 11.
* * * * *
    (59) * * *
    (i) * * *
    (A) * * *
    (2) Previously approved in paragraph (c)(59)(i)(A)(1) of this 
section and now deleted without replacement: R9-3-303.
* * * * *
    (161) * * *
    (i) * * *
    (A) * * *
    (6) Arizona Administrative Code, Title 18, ``Environmental 
Quality'', chapter 2,''Department of Environmental Quality--Air 
Pollution Control'', R18-2-311, ``Test Methods and Procedures,'' and 
R18-2-312, ``Performance Tests,'' effective November 15, 1993.
    (162) The following plan revision was submitted on October 29, 
2012, and supplemented on September 6, 2013 and July 2, 2014, by the 
Governor's designee.
    (i) * * *
    (A) * * *
    (3) Arizona Administrative Code, Title 18, ``Environmental 
Quality,'' chapter 2 ``Department of Environmental Quality--Air 
Pollution Control,'' R18-2-101, ``Definitions,'' only definition nos. 
(2), (32), (87), (109), and (122), effective August 7, 2012; R18-2-217, 
``Designation and Classification of Attainment Areas,'' effective 
November 15, 1993; R18-2-218, ``Limitation of Pollutants in Classified 
Attainment Areas,'' effective August 7, 2012; R18-2-301, 
``Definitions,'' effective August 7, 2012; R18-2-302, ``Applicability; 
Registration; Classes of Permits,'' effective August 7, 2012; R18-2-
302.01, ``Source Registration Requirements,'' effective August 7, 2012; 
R18-2-303, ``Transition from Installation and Operating Permit Program 
to Unitary Permit Program; Registration Transition; Minor NSR 
Transition,'' effective August 7, 2012; R18-2-304, ``Permit Application 
Processing Procedures,'' effective August 7, 2012; R18-2-306, ``Permit 
Contents,'' effective December 20, 1999; R18-2-306.01, ``Permits 
Containing Voluntarily Accepted Emission Limitations and Standards,'' 
effective January 1, 2007; R18-2-306.02, ``Establishment of an 
Emissions Cap,'' effective September 22, 1999; R18-2-315, ``Posting of 
Permit,'' effective November 15,1993; R18-2-316, ``Notice by Building 
Permit Agencies,'' effective May 14, 1979; R18-2-319, ``Minor Permit 
Revisions,'' August 7, 2012; R18-2-320, ``Significant Permit 
Revisions,'' effective August 7, 2012; R18-2-321, ``Permit Reopenings; 
Revocation and Reissuance; Termination,'' effective August 7, 2012; 
R18-2-323, ``Permit Transfers,'' effective February 3, 2007; R18-2-330, 
``Public Participation,'' effective August 7, 2012; R18-2-332, ``Stack 
Height Limitation,'' effective November 15, 1993; R18-2-334, ``Minor 
New Source Review'' effective August 7, 2012; R18-2-401 
``Definitions,'' effective August 7, 2012; R18-2-402 ``General,'' 
effective August 7, 2012; R18-2-403 ``Permits for Sources Located in 
Nonattainment Areas,'' effective August 7, 2012; R18-2-404, ``Offset 
Standards,'' effective August 7, 2012; R18-2-405, ``Special Rule for 
Major Sources of VOC or Nitrogen Oxides in Ozone Nonattainment Areas 
Classified as Serious or Severe,'' effective August 7, 2012; R18-2-406, 
``Permit Requirements for Sources Located in Attainment and 
Unclassifiable Areas,'' effective August 7, 2012; R18-2-407, ``Air 
Quality Impact Analysis and Monitoring Requirements,'' excluding 
subsection (H)(1)(c), effective August 7, 2012; R18-2-409, ``Air 
Quality Models,'' effective November 15, 1993; and R18-2-412, ``PALs'' 
effective August 7, 2012.
    (4) Arizona Revised Statutes, title 49, ``Environment,'' chapter 1 
``General Provisions'', section 49-107, ``Local delegation of state 
authority,'' effective July 1, 1987.
    (ii) Additional materials.
    (A) Arizona Department of Environmental Quality.
    (1) Setting Applicability Thresholds, pages 1547-1549 in Appendix A 
to ``State Implementation Plan Revision: New Source Review'' adopted on 
October 29, 2012.
    (2) Memorandum, ``Proposed Final Permits to be Treated as 
Appealable Agency Actions,'' dated February 10, 2015, from Eric Massey, 
Air Quality Division Director to Balaji Vaidyanathan, Permit Section 
Manager, submitted on February 23, 2015.
    (3) ``State Implementation Plan Revision: New Source Review--
Supplement,'' relating to the division of jurisdiction for New Source 
Review in Arizona, adopted on July 2, 2014.
* * * * *
[FR Doc. 2015-27785 Filed 10-30-15; 8:45 am]
BILLING CODE 6560-50-P
```