UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
 

REGION IX
 

75 Hawthorne Street
 

San Francisco, CA 94105·3901
 

APR 1 2 20ta OFFICE OF THE 

REGIONAL ADMINISTRATOR 

Mary D. Nichols, Chairman 

California Air Resources Board 

1001 I Street, P.O. Box 2815 

Sacramento, CA 95812 

Re: Request for Attorney General's Interpretation of Senate Bill 700 (Stats. 2003, ch. 479) 

Dear Chairman Nichols: 

I am writing to request a legal interpretation from the California Attorney General of a 

State law known as Senate Bill 700 (Stats. 2003, ch. 479) ("SB 700") as it applies to New Source 

Review (NSR) permitting rules (Rules 2020 and 2201), adopted by the San Joaquin Valley 

Unified Air Pollution Control District ("District") on December 19,2002, and approved into the 

California State Implementation Plan (SIP) by EPA on May 17, 2004 (69 Fed. Reg. 27,837). On 

January 29, 2010, EPA proposed to approve recent revisions to the District's NSR rules. 75 Fed. 

Reg. 4,745. In the same notice, EPA proposed pursuant to section 1l0(k)(6) of the Clean Air 

Act to correct an error we believed we had made in our May 2004 final action approving the 

December 2002 version of the District's NSR rules. 

We indicated in our proposed error correction that our May 2004 approval of District 

Rules 2020 and 2201, which did not on their face exempt any agricultural sources from 

permitting or exempt any agricultural sources from the emission offsets requirement, was 

inconsistent with and contrary to SB 700's limited permitting exemption for minor sources of 

agricultural emissions and exemption from the offsets requirement for all minor agricultural 

sources (until emissions reductions from such sources are creditable). In short, our proposed 

error correction was premised on the conclusion that, at the time of EPA's May 2004 approval 

action, the District did not have the authority under state law (specifically, SB 700) to implement 

the NSR rules, as adopted in December 2002, to require permits for minor agricultural sources 

with actual emissions (excluding fugitive dust) less than 50% of the major source threshold and 

to require emission offsets for minor agricultural sources in a manner similar to other minor 

sources. 

In response to our January 29, 2010, proposed error correction, we received comments 

from Earthjustice and the Center on Race, Poverty & the Environment (CRP&E). The comments 

criticized EPA's January 29, 2010, proposed error correction for relying on an interpretation of 

certain perceived limitations on the District's authority in SB 700 without seeking California's 

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interpretation of that law. In light of those comments, EPA is deferring taking final action on the 

error correction portion of our January 29, 2010 proposal until after we have received input from 

the State of California on the proper interpretation of certain provisions of SB 700. 

The preamble to our proposed error correction on January 29, 2010, provides an 

extensive factual background. In summary, in 2001, EPA finalized a limited disapproval of 

Rules 2020 and 2201 because, among other reasons, Rule 2020, by referring to California law, 

exempted major agricultural sources from NSR permitting. 66 Fed. Reg. 37,587, July 29,2001. 

In response, the District revised Rule 2020 to omit any reference to the California State law 

exemption for agricultural sources. In September 2003, the Governor of California signed SB 

700, which we understood as eliminating the exemption for major agricultural sources. As set 

forth in greater detail in the January 29, 2010, preamble, we later recognized that SB 700 also 

established under State law a limited exemption for minor agricultural sources that are less than 

50% of the major source threshold and an exemption from the emission offsets requirement for 

minor agricultural sources until emissions reductions from such sources are creditable. 

California Health & Safety Code (CH&SC) sections 42301.16 and 42301. 18(c). Senate Bill 700 

also contained a provision which EPA, in our January 29,2010, error correction characterized as 

requiring the District to make certain findings before it could subject minor agricultural sources 

to new source review offset requirements. CH&SC section 42301. 16(c). 

The comments submitted by Earthjustice and CRP&E, however, point to provisions of 

SB 700, such as CH&SC sections 39011.5(b) and (c), that could be interpreted as authorizing the 

District to implement the December 2002 version of the District NSR rules without limitation as 

to the permitting threshold or the offsets limitation for minor agricultural sources otherwise 

applicable under CH&SC sections 42301.16(c) and 42301.18(c), respectively. In light of the 

comments we received on our proposed error correction, I am requesting your assistance in 

obtaining the State's legal interpretation. 

Specifically, what was the District's legal authority, effective January 1, 2004, to require 

NSR permits for agricultural sources with actual emissions under 50% of the major source 

threshold without undertaking the procedures and making the findings set forth in CH&SC 

section 42301.16(c), and to require emission offsets for minor agricultural sources regardless of 

the creditability of emissions reductions from such sources in light of CH&SC section 39011.5 

and the December 2002 version of the District NSR rules? 

Thank you in advance for assisting us in obtaining California's interpretation of legal 

authority on this matter. If you have questions, please contact Nina Spiegelman in the Office of 

Regional Counsel at 415-972-3899 or Deborah Jordan, Air Division Director, at 415-947-8715. 

Sincerely, 

Jared Blumenfeld 

Regional Administrator 
Enclosures: 

EPA January 29, 2010 Proposed Rule 

District Rule 2020, amended December 19,2002 

District Rule 2201, amended December 19, 2002 

Earthjustice March 1,2010 Letter 

CRP&E March 1,2010 Letter 

ARB May 30, 2007 Letter 

ARB December 18,2006 Letter 

cc: Mary Hackenbracht, Senior Assistant Attorney General, Natural Resources Section, 

Office of the California Attorney General
 

James N. Goldstene, Executive Officer, Air Resources Board
 

Ellen M. Peter, Chief Counsel, Air Resources Board