[Federal Register Volume 77, Number 35 (Wednesday, February 22, 2012)]
[Proposed Rules]
[Pages 10430-10434]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2012-4172]


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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[EPA-R09-OAR-2012-0140; FRL-9634-5]


Revision to the South Coast Air Quality Management District 
Portion of the California State Implementation Plan, South Coast Rule 
1315

AGENCY: Environmental Protection Agency (EPA).

ACTION: Proposed rule.

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SUMMARY: The Environmental Protection Agency (EPA) is proposing to 
approve a State Implementation Plan (SIP) revision for the South Coast 
Air Quality Management District (District) portion of the California 
SIP. This SIP revision proposes to incorporate Rule 1315--Federal New 
Source Review Tracking System--into the District's SIP approved New 
Source Review (NSR) program to establish the procedures for 
demonstrating equivalency with Federal offset requirements by 
specifying how the District will track debits and credits in its Offset 
Accounts for Federal NSR Equivalency for specific Federal nonattainment 
pollutants and their precursors. The District's SIP approved NSR 
program contained in Regulation XIII allows the District to exempt 
certain sources from obtaining offsetting emission reductions on the 
open market and for the District to provide offsets for designated 
sources that qualify, such as essential public services. EPA's proposal 
to approve this SIP revision is based on finding that Rule 1315 
provides an adequate system to demonstrate on an on-going basis that an 
equivalent amount of offsets are being provided pursuant to this rule 
as would otherwise be required by the Clean Air Act (CAA) and that the 
emission reductions the District is crediting and debiting in its 
Offset Accounts meet the requirements of the CAA and can be used to 
provide the offsets otherwise required for Federal major sources and 
modifications.

DATES: Comments on this Notice of Proposed Rulemaking (NPR) must be 
submitted no later than March 23, 2012.

ADDRESSES: Submit comments, identified by docket number EPA-R09-OAR-
2012-0140, by one of the following methods:
    1. Federal eRulemaking Portal: www.regulations.gov. Follow the on-
line instructions.
    2. Email: <a href="/cdn-cgi/l/email-protection#c4b6fda5adb6b4a1b6a9adb0b784a1b4a5eaa3abb2"><span class="__cf_email__" data-cfemail="b8ca81d9d1cac8ddcad5d1cccbf8ddc8d996dfd7ce">[email protected]</span></a>.
    3. Mail or deliver: Gerardo Rios (Air-3), U.S. Environmental 
Protection Agency Region IX, 75 Hawthorne Street, San Francisco, CA 
94105-3901.
    Instructions: All comments will be included in the public docket 
without change and may be made available online at www.regulations.gov, 
including any personal information provided, unless the comment 
includes Confidential Business Information (CBI) or other information 
whose disclosure is restricted by statute. Information that you 
consider CBI or otherwise protected should be clearly identified as 
such and should not be submitted through www.regulations.gov or email. 
www.regulations.gov is an ``anonymous access'' system, and EPA will not 
know your identity or contact information unless you provide it in the 
body of your comment. If you send email directly to EPA, your email 
address will be automatically captured and included as part of the 
public comment. If EPA cannot read your comment due to technical 
difficulties and cannot contact you for clarification, EPA may not be 
able to consider your comment.
    Docket: The index to the docket for this action is available 
electronically at www.regulations.gov and in hard copy at EPA Region 
IX, 75 Hawthorne Street, San Francisco, California. While EPA generally 
lists the documents in the docket in the index, some information may 
not be specifically listed as a line item in the index or may be 
publicly available only at the hard copy location (e.g., voluminous 
records, 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. The hard 
copy materials constitute the docket.

FOR FURTHER INFORMATION CONTACT: Laura Yannayon, EPA Region IX, (415) 
972-3534, <a href="/cdn-cgi/l/email-protection#87fee6e9e9e6fee8e9a9ebe6f2f5e6c7e2f7e6a9e0e8f1"><span class="__cf_email__" data-cfemail="532a323d3d322a3c3d7d3f32262132133623327d343c25">[email protected]</span></a>.

SUPPLEMENTARY INFORMATION: Throughout this document, ``we'', ``us'', 
and ``our'' refer to EPA.

Table of Contents

I. Background
II. Evaluation of SIP Revision
    A. What is in the SIP revision?
    B. What are the Federal Clean Air Act requirements?
    C. How does the SIP revision comply with the Federal integrity 
criteria and demonstrate equivalency?
    D. Do Rule 1315's offsets comply with the EPA's base year 
requirements?
    E. CAA Section 110(l)
    F. Public Comment and Final Action
III. Statutory and Executive Order Reviews

I. Background

    EPA allows and encourages local authorities to tailor SIP programs, 
including new source review permitting programs, to account for that 
community's particular needs provided that the SIP is not less 
stringent than the Act's requirements. See generally CAA Section 116, 
42 U.S.C. 7416; Train v. Natural Res. Defense Council, 421 U.S. 60, 79 
(1975); Union Electric Co. v. EPA, 427 U.S. 246, 250 (1976). The 
District's nonattainment permitting rules contained in District 
Regulation XIII went through numerous public workshops and stakeholder 
meetings prior to adoption in December 1995. The California Air 
Resources Board (CARB) submitted Regulation XIII along with supporting 
regulations and documents to EPA Region 9 on August 28, 1996. On 
December 4, 1996, EPA Region 9 published a direct final approval of 
Regulation XIII in the Federal Register. 61 FR 64291 (December 4, 1996) 
(Codified at 40 CFR 52.220(c)(240)(i)(1)).
    When EPA approved Regulation XIII, we noted that Rule 1304 exempted 
certain major sources from obtaining offsets and Rule 1309.1 allowed 
the

[[Page 10431]]

District to provide offsets for specific ``priority'' projects. We 
approved these rules because the District committed to demonstrating on 
an annual basis that it was providing an amount of offsets that was 
equivalent to the amount required to offset Federal new and modified 
major sources.\1\ EPA did not require the District to codify its 
internal NSR tracking system in rule language as a condition of full 
approval of Regulation XIII. From 1997 through 2005, the District 
submitted annual equivalency reports to its Board for approval and 
provided copies to EPA Region 9.\2\ The District's Board meetings at 
which the annual reports were approved were open to the public.
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    \1\ Environmental Protection Agency, Region IX Air & Toxics 
Division Technical Support Document for EPA's Notice of Final 
Rulemaking for the California State Implementation Plan South Coast 
Air Quality Management District New Source Review by Gerardo C. 
Rios, October 24, 1996 (TSD).
    \2\ Annual Equivalency Reports approved by the South Coast AQMD 
Board, dated February 14, 1997, March 13, 1998, April 9, 1999, 
August 18, 2000, November 9, 2001, August 2, 2002, and April 2, 
2004.
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    EPA informed the District beginning in 2002 that if it was 
significantly expanding the sources that were allowed to obtain offsets 
from the internal NSR tracking system through a new offset budget rule 
(Rule 1309.2--Offset Budget), the tracking system's transparency should 
be improved. Proposed SCAQMD NSR Offset Tracking System, Oct. 14, 2005, 
(2005 Proposed Tracking System) at p.1. In 2004-2005, the District 
drafted regulatory language, now revised and adopted as Rule 1315, to 
establish NSR program equivalency with the Federal NSR offset 
requirements for major sources and demonstrate annually that the 
District provided sufficient offsets for Federal major sources and 
modifications that were (1) otherwise exempt from offset requirements 
under Rule 1304 or (2) allocated offsets pursuant to Rule 1309.1. 
Proposed Rule 1315(a), Preliminary Draft, Adopted Sept. 8, 2006.
    In our discussions during 2002-2003, EPA also noted that the 
District's use of the negative NSR balances and other pre-1990 era 
offsets to fund the NSR tracking system would be inconsistent with 
Federal requirements unless the District had sufficient records for 
those offsets. Staff Report: Proposed Rule 1315--Federal New Source 
Review Tracking System, dated January 7, 2011, at pp. 6-7 (2011 Staff 
Report); 2005 Proposed Tracking System at pp. 1-2. The District 
concluded that it did not readily have sufficient documentation for 
many of the offsets it had collected from the negative NSR balances and 
other pre-1990 era offsets. Proposed SCAMQD NSR Offset Tracking System, 
Oct. 14, 2005 at p. 2.
    The District responded to EPA's request by eliminating any offsets 
originating before 1990 without documentation on October 14, 2005. 2005 
Proposed Tracking System, at pp. 12-13. Unlike many areas, the District 
requires almost all Federal minor sources to obtain a permit and offset 
any emission increases up to the sources' permitted emissions level. 
Rule 1303(b)(2).
    The adjustments the District made in October 2005 to the existing 
NSR tracking system significantly decreased the balance of available 
offsets for most pollutants. For example, this adjustment reduced the 
internal NSR tracking system balance for PM<INF>10</INF> (particulate 
matter with an aerodynamic diameter less than or equal to 10 
micrometers) by 92% (from 34.5 to 2.67 tons per day). 2011 Staff 
Report, at p. 9; 2005 Proposed Tracking System, at Table 1. The 
District informed EPA Region 9 that it had previously credited the 
offsets from minor orphan shutdowns for State purposes. The District 
had not needed to credit those minor orphan shutdowns for its Federal 
accounts because the offsets from the negative NSR balances were far 
greater than the amount needed to demonstrate equivalency with Federal 
offset requirements for Rule 1304 exempt sources and Rule 1309.1 
priority reserve sources. (2005 Proposed Tracking System), at p. 3.
    EPA and the District had further discussions about the changes to 
the NSR tracking system resulting in a revised letter to EPA dated 
February 23, 2006. SCAQMD's Revised NSR Offset Tracking System, Feb. 
23, 2006. The revisions primarily resolved issues EPA raised regarding 
the District's method of reporting the offset account balances and the 
remedy if a shortfall was projected. SCAQMD Letter from Dr. Barry 
Wallerstein to Deborah Jordan, Feb. 24, 2006. EPA responded by letter 
on April 11, 2006, indicating that the District's proposed NSR Offset 
Tracking System funded with emission reductions from minor and major 
orphan shutdowns and other sources (i.e. credits to the system) 
appeared to be sufficient for EPA to propose approval of Rule 1315. EPA 
Letter from Deborah Jordan to Dr. Barry Wallerstein, April 11, 2006. 
Both the October 2005 Proposed SCAQMD NSR Offset Tracking System and 
February 23, 2006 Revised NSR Offset Tracking System appended tables 
prepared by the SCAQMD called the ``Federal Running Balances.'' Revised 
NSR Offset Tracking System, Feb. 23, 2006, Attachment 1. The Federal 
Running Balances table contains details concerning the credits added 
and debits subtracted from the NSR offset tracking system.
    The District adopted Rule 1315's regulatory language codifying how 
it will account for, or ``track'', the emission reductions that it adds 
into its Offset Accounts as credits and those which it subtracts as 
debits to provide offsets for the construction of certain Federal major 
sources or modifications exempted from offset requirements pursuant to 
Rule 1304 or for which the District provided offsets pursuant to Rule 
1309.1. SCAQMD Governing Board Resolution for the Re-adoption of Rule 
1315--Federal New Source Review Tracking System, dated Feb. 4, 2011. 
EPA is now proposing to approve Rule 1315 as a SIP revision.

II. Evaluation of SIP Revision

A. What is in the SIP revision?

    Rule 1315 which the District, through CARB, submitted to EPA 
consists of the regulatory text the District adopted on February 4, 
2011, along with supporting documentation including a Staff Report 
dated January 7, 2011. EPA received the SIP submittal for Rule 1315 
from CARB on March 2, 2011, and a supplemental submittal on February 7, 
2012. On March 25, 2011, we found that the submittal of District Rule 
1315 met the completeness criteria in 40 CFR part 51, appendix V, which 
must be met before formal EPA review.
    The Rule contains a section describing its purpose and a 
definitions section. Rule 1315(a) and (b). Rule 1315(c), Offset 
Accounts for Federal NSR Equivalency, contains provisions for 
quantifying, crediting and debiting the offset accounts. Rule 
1315(c)(1), District Offset Accounts for Federal Nonattainment Air 
Contaminants, provides that all pre-1990 offsets were removed at the 
end of 2005 and sets forth the initial District Offset Account Balances 
in Table A. Rule 1315(c)(2) provides that the District shall debit its 
Offsets Accounts for emissions increases at Federal new and modified 
major sources that are not required to provide Emission Reduction 
Credits (ERCs) based on Rules 1304 (Exemptions) and 1309.1 (Priority 
Reserve). Rule 1315(c)(3)(A) contains a list of the emission reductions 
the District can add to its Offset Accounts and 1315(c)(3)(B) 
establishes how the District will quantify the actual emissions 
reductions for that list. Rule 1315(c)(4) specifies how the District 
will discount each Offset Account annually to ensure the reductions 
will be surplus to all CAA requirements at the time an offset is

[[Page 10432]]

used. Rule 1315(c)(5) specifies the steps the District will take to 
calculate annually a Preliminary Determination of Equivalence and Final 
Determination of Equivalence. In Rule 1315(c)(6), the District sets 
forth how the credits and debits meet each of the Federal requirements 
for offsets. The remaining provisions in Rule 1315 establish the 
methods for reporting the annual Preliminary and Final Equivalency 
demonstrations, projecting future Offset Account balances and methods 
to remedy any balance shortfalls. Rule 1315 provides that it will 
expire on January 1, 2031.

B. What are the Federal Clean Air Act requirements?

    The South Coast Air Basin is an extreme nonattainment area for 
ozone and a serious nonattainment area for PM<INF>10.</INF> The 
Coachella Valley Air Basin is a severe nonattainment area for ozone and 
a serious nonattainment area for PM<INF>10.</INF> Oxides of nitrogen 
(NO<INF>X</INF>) and volatile organic compounds (VOC) are both ozone 
precursors and are therefore treated as ozone nonattainment pollutants. 
Sulfur dioxide (SO<INF>2</INF>) emissions are PM<INF>10</INF> 
precursors and are therefore also treated as a PM<INF>10</INF> 
nonattainment pollutant. While the District is classified as 
nonattainment for PM<INF>2.5</INF> (particulate matter with an 
aerodynamic diameter less than or equal to 2.5 micrometers) and 
portions of the District as nonattainment for lead, Rule 1315 does not 
apply to these pollutants. The District was redesignated to attainment 
for carbon monoxide (CO) on May 11, 2007 (72 FR 26718), but CO is 
included in the tracking system because of its past nonattainment 
status.
    As required by CAA Sec.  110(a)(2)(C), SIPs are required to include 
provisions to comply with CAA Part D for nonattainment pollutants. 
Among the Part D requirements, Sec.  173(a)(1)(A) requires new and 
modified major stationary sources to provide offsetting emission 
reductions. Section 173(c) requires the offsetting emission reductions 
to be quantifiable, surplus, permanent, and enforceable. See 40 CFR 
51.165(a)(3)(ii)(c)(i); 40 CFR part 51, appendix S. This proposal will 
refer to those requirements as the ``federal integrity criteria''.
    EPA is proposing to approve Rule 1315 because the rule ensures that 
the emission reductions in the District's Offset Accounts meet the 
Federal integrity criteria. See Rule 1315(c). Rule 1315 also 
demonstrates that the District's offset tracking system provides an 
equivalent quantity of offsets for those major sources and 
modifications that are not required to provide such offsets pursuant to 
District Rules 1304 and 1309.1. EPA's analysis of how the credits and 
debits tracked in Rule 1315 meet the Federal integrity criteria is 
summarized below and set forth in more detail in the Technical Support 
Document (TSD).

C. How does the SIP revision comply with the Federal integrity criteria 
and demonstrate equivalency?

1. The Offsets Credited and Debited Through Rule 1315 Are Quantifiable
    EPA is proposing to approve Rule 1315 because the emission 
reductions that the District credits and debits to its Offset Accounts 
meet the requirement to be quantifiable emissions reductions. The 
District meets this requirement by demonstrating that the credits and 
debits are actual and quantifiable reductions of emissions. To quantify 
the reductions of emissions from orphan shutdown sources, the District 
determines the permitted emissions level and then applies an 80% actual 
emissions factor. Rule 1315(c)(3)(B)(i); Staff Report at p. 17 (``AQMD 
proposes to use an average discount factor to account for the 
difference between potential and actual emissions.''). The vast 
majority of emission reductions credited to the Offset Accounts are 
from orphan shutdowns, which occur when the owner/operator of a 
stationary source that has been shut down does not apply for an 
Emission Reduction Credit (ERC) under Rule 1309 (Emission Reduction 
Credits and Short Term Credits). Staff Report at p. 17. The information 
that is available to the District when a source is shut down and the 
operating permit is inactivated are the source's permitted emissions, 
which represent its potential to emit rather than its actual emissions. 
Under Rule 1315, the District makes an adjustment to the permitted 
(i.e. potential) emissions by applying an 80% actual emissions factor 
before crediting these emissions to the Offset Accounts. See Rule 
1315(c)(3)(B)(i); Staff Report at p. 17.
    The District has justified its determination that reducing the 
permitted (i.e. potential) emissions by 20% and crediting the remaining 
80% is an adequate representation of actual emissions based on several 
considerations. The District has historically implemented an 80% actual 
emissions factor for estimating actual emission reductions in its 
Regulation XIII annual reports following concurrence by the California 
Air Resources Board. Staff Report at 17. The District also provided a 
Federal Reserve Statistical Release Report examining historical 
industrial production and capacity utilization. While certain short 
term cycles may reflect greater or lower utilization, the District's 
justification for selecting an 80% factor over the long term is 
supported by this data. Id. The District's method of quantifying actual 
emission reductions is also supported by the inherent structure of the 
District's NSR program. Every stationary source that is operated in the 
District with permitted emissions exceeding 4 tons per year (tpy) of 
ozone precursors or PM<INF>10</INF> (including precursors) is required 
to obtain ERCs to offset the entire amount of its permitted emissions. 
The cost of obtaining the ERCs to offset permitted emissions provides 
``a strong incentive to keep [each source's] potential emissions in 
line with actual emissions during times of high production''. Staff 
Report at 17.
    For exempt and priority reserve sources that obtain their offsets 
from the District, the District limits the amount of offsets provided 
by including permit conditions that limit operations to actual 
operating scenarios. The District has shown that fifty to eighty 
percent of the very small exempt sources (emitting < 4 tpy of most 
pollutants) have permits emissions limits that are less than one-half 
of the exemption threshold (i.e. permitted emissions are less than 2 
tpy). Table 5 of Staff Report, p 18. This information supports finding 
that the District is permitting sources at close to the source's actual 
emissions and that an 80% actual emissions factor adequately reflects 
actual reductions from orphan shutdown sources.
    For the reasons provided by the District, EPA is proposing to 
approve Rule 1315 as ensuring that the emission reductions it credits 
to its Offset Accounts pursuant to Rule 1315(c)(3)(B)(i) meet the 
requirement to be actual emission reductions based on crediting only 
80% of permitted emission levels.
2. The Offsets Credited and Debited Through Rule 1315 Are Surplus
    Rule 1315(c)(4) ensures that any offsets debited from the District 
Offset Accounts are properly adjusted to be surplus at the time they 
are used as required by the Federal integrity criteria. Specifically, 
the rule requires that the balance of credits in the Offset Accounts 
for each pollutant be reduced annually to account for any newly adopted 
rules that control these pollutants, ensuring that the debits used as 
offsets are surplus at the time they are used. Rule 1315(c)(4) 
(providing that the District discount the Offset Account balances 
annually ``based on the percentage reduction in overall

[[Page 10433]]

permitted emissions projected to be achieved as a result of 
implementation of control requirements that became effective during the 
previous calendar year for each specific nonattainment contaminant 
within the District.'') EPA is proposing to find that Rule 1315 ensures 
that the offsets the District debits from its Offset Accounts meet the 
Federal integrity criterion to be surplus.
3. The Offsets Debited From the District Offset Accounts Are Permanent
    The emission reductions credited to the District's Offset Accounts 
are all permanent reductions at the time they are credited to the 
accounts because the permit for the emission source has either been 
retired or revised to include conditions that limit the emissions to 
levels lower than they are otherwise required to be limited through the 
use of federally enforceable permit conditions. The debits are 
permanent because Rule 1315 requires the District to subtract those 
offsets from the District's Offset Account balances. Rule 
1315(c)(5)(B). The District must provide its Preliminary and Final 
Determinations of Equivalency annually to ensure there is a positive 
balance in each Offset Account. Rule 1315 also contains an equivalency 
backstop provision if any Offset Account has a shortfall. Rule 1315(f). 
EPA is proposing to find that Rule 1315 assures that the emission 
reductions in the District's Offset Accounts meet the requirement for 
permanent reductions.
4. The Offsets Credited and Debited From the District Offset Accounts 
Are Enforceable
    The emission reductions credited to the District's Offset Accounts 
for orphan shutdowns or orphan reductions are all enforceable 
reductions at the time they are credited to the accounts because the 
permit for the emission source has either been retired, which means the 
source is no longer allowed to operate/emit those pollutants, or 
revised to include conditions that limit the emissions to levels lower 
than they are otherwise required to be limited through the use of 
federally enforceable permit conditions. This ensures that the 
emissions will be permanently retired or reduced. Rule 1315(b)(4) & (5) 
and (c)(3)(A)(i) & (ii). For each of the other types of credits listed 
in Rule 1315 (c)(3)(A), the credits are based on ERCs that have been 
generated pursuant to Rule 1309, which also requires that the emission 
reductions meet each of the Federal integrity criterion, including the 
requirement to be enforceable emission reductions. Therefore, EPA is 
proposing to find Rule 1315 meets the Federal integrity criterion for 
enforceable reductions.

D. Do Rule 1315's offsets comply with the EPA's base year requirements?

    40 CFR 51.165(a)(3)(i)(C) provides:

    Emissions reductions achieved by shutting down an existing 
emission unit or curtailing production or operating hours may be 
generally credited for offsets if * * *. (ii) [t]he shutdown or 
curtailment occurred after the last day of the base year for the SIP 
planning process. For purposes of this paragraph, a reviewing 
authority may choose to consider a prior shutdown or curtailment to 
have occurred after the last day of the base year if the projected 
emissions inventory used to develop the attainment demonstration 
explicitly includes the emissions from such previously shutdown or 
curtailed emission units.

See also 40 CFR part 50, appendix S, IV.

    Rule 1315 is being submitted by the District to demonstrate 
equivalency with the Part D requirements for ozone and PM<INF>10</INF> 
(and their precursor emissions). To evaluate Rule 1315's compliance 
with the base year requirement for using offsets from emissions units 
being shut down or curtailed, EPA has determined that the most 
appropriate attainment demonstrations to review are the District's 
approved PM<INF>10</INF> and 8-hour ozone Plans. Approval and 
Promulgation of [SIPs] for Air Quality Planning Purposes; California--
South Coast and Coachella, 70 FR 69081 (Nov. 14, 2005) (2003 Plan); 
Approval of Air Quality Implementation Plans; California; South Coast; 
Attainment Plan for 1997 8-hour Ozone Standards, EPA-R09-OAR-2011-0622 
(Signed Dec. 15, 2011) (2007 Plan). The District's PM<INF>10</INF> Plan 
was adopted in 2003 and relies on a 1997 base year emission inventory. 
2003 Plans, Chapter 3 & Appendix III. For ozone, the Plan was adopted 
in 2007 and relies on a 2002 base year emission inventory. 2007 Plan, 
Chapter 3 & Appendix III.
    In accordance with the base year requirements specified in 40 CFR 
51.165, the District estimated that 3.1 tons per day (tpd) of pre-2002 
base year VOC emission reductions may be needed to satisfy offset 
demand. 2007 Plan Appendix III. For ozone precursors, the District 
added 27 and 2 tons per day for VOC and NO<INF>X</INF>, respectively, 
as growth.\3\ This amount includes the 3.1 tpd of pre-2002 base year 
VOC emission reductions. While this is not the total amount of pre-2002 
base year emission reductions available as debits pursuant to Rule 
1315, the District has demonstrated that this amount represents the 
highest amount of pre-2002 credits that are expected to be used as 
offsets prior to attainment of the ozone standard. 2007 Plan Appendix 
III, pgs 28-34. The District used a similar approach for the 2003 Plan 
as it pertains to PM<INF>10</INF> and SO<INF>X</INF> emissions. See the 
TSD for additional details. This approach is consistent with EPA 
guidance that states must include pre-base year credits to the ``extent 
that the State expects that such credits will be used for offsets * * 
*''. 57 FR 13498
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    \3\ See 2007 Plan Appendix III, pgs 28-34, Tables 2-8 and 2-12. 
For Table 2.8, the District provided EPA with the point and area 
source data used to generate the summary data. EPA used this data to 
determine the amount of emission due to growth at facilities subject 
to NSR offset requirements.
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    Therefore, even if the District Offset Accounts rely on pre-base 
year emission reductions as offsets, the District's Plans have 
adequately added pre-base year emissions explicitly into the 
appropriate projected planning inventories. For these reasons, EPA is 
proposing to approve Rule 1315.

E. CAA Section 110(l)

    Under section 110(l) of the CAA, EPA may not approve any SIP 
revision that would interfere with attainment, reasonable further 
progress (RFP) or any other CAA requirement. EPA's incorporation of 
Rule 1315 into the SIP will not interfere with attainment or RFP 
because the rule provides a regulatory mechanism setting forth the 
internal offset accounting system that the District has been relying 
on. In addition, the District does not rely on the offsets in the 
District's Offset Accounts for attainment or RFP in the District's most 
recent attainment demonstrations for ozone or PM<INF>10</INF>.
    This SIP revision also does not interfere with any other CAA 
requirement. Rule 1315 provides regulatory language detailing how the 
District will quantify and add credits and subtract debits from its 
Offset Accounts. Our proposal to approve Rule l315 is based on finding 
the rule ensures the credits and debits meet the Federal integrity 
criteria and that the District system overall is equivalent to the 
requirements of Section 173.

F. Public Comment and Final Action

    Because EPA has determined Rule 1315 fulfills all relevant 
requirements, we are proposing to fully approve it as described in 
section 110(k)(3) of the Act. We will accept comments from the public 
on this proposal for the next 30 days. After considering the 
information and views submitted to us during the comment period, we 
will take final action on this SIP submittal.
    Rule 1315 has been under development at the District and the

[[Page 10434]]

interested public has been involved in its development for the last 
several years, including state litigation concerning the Rule. 
Therefore, EPA does not anticipate extending the public comment period 
beyond 30 days absent extraordinary or compelling circumstances.

III. Statutory and Executive Order Reviews

    Under the Clean Air Act, the Administrator is required to approve a 
SIP submission that complies with the provisions of the Act and 
applicable Federal regulations. 42 U.S.C. 7410(k); 40 CFR 52.02(a). 
Thus, in reviewing SIP submissions, EPA's role is to approve State 
choices, provided that they meet the criteria of the Clean Air Act. 
Accordingly, this proposed action merely approves State law as meeting 
Federal requirements and does not impose additional requirements beyond 
those imposed by State law. For that reason, this proposed action:
    <bullet> Is not a ``significant regulatory action'' subject to 
review by the Office of Management and Budget under Executive Order 
12866 (58 FR 51735, October 4, 1993);
    <bullet> Does not impose an information collection burden under the 
provisions of the Paperwork Reduction Act (44 U.S.C. 3501 et seq.);
    <bullet> Is certified as not having a significant economic impact 
on a substantial number of small entities under the Regulatory 
Flexibility Act (5 U.S.C. 601 et seq.);
    <bullet> Does not contain any unfunded mandate or significantly or 
uniquely affect small governments, as described in the Unfunded 
Mandates Reform Act of 1995 (Pub. L. 104-4);
    <bullet> Does not have Federalism implications as specified in 
Executive Order 13132 (64 FR 43255, August 10, 1999);
    <bullet> Is not an economically significant regulatory action based 
on health or safety risks subject to Executive Order 13045 (62 FR 
19885, April 23, 1997);
    <bullet> Is not a significant regulatory action subject to 
Executive Order 13211 (66 FR 28355, May 22, 2001);
    <bullet> Is not subject to requirements of Section 12(d) of the 
National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272 
note) because application of those requirements would be inconsistent 
with the Clean Air Act; and
    <bullet> Does not provide EPA with the discretionary authority to 
address disproportionate human health or environmental effects with 
practical, appropriate, and legally permissible methods under Executive 
Order 12898 (59 FR 7629, February 16, 1994).
    In addition, this proposed rule does not have tribal implications 
as specified by Executive Order 13175 (65 FR 67249, November 9, 2000), 
because the SIP is not approved to apply in Indian country located in 
the State, and EPA notes that it will not impose substantial direct 
costs on tribal governments or preempt tribal law.

List of Subjects in 40 CFR Part 52

    Air pollution control, Environmental protection, Intergovernmental 
relations, Particulate matter, Reporting and recordkeeping 
requirements.

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

    Dated: February 9, 2012.
Jared Blumenfeld,
Regional Administrator, Region IX.
[FR Doc. 2012-4172 Filed 2-21-12; 8:45 am]
BILLING CODE 6560-50-P


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