```

[Federal Register Volume 80, Number 87 (Wednesday, May 6, 2015)]
[Notices]
[Pages 26032-26041]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2015-10632]

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ENVIRONMENTAL PROTECTION AGENCY

[EPA-HQ-OAR-2013-0024; FRL 9927-29-OAR]

California State Nonroad Engine Pollution Control Standards; 
Amendments to Spark Ignition Marine Engine and Boat Regulations; Notice 
of Decision

AGENCY: Environmental Protection Agency (EPA).

ACTION: Notice of decision.

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SUMMARY: The Environmental Protection Agency (EPA) is granting the 
California Air Resources Board (CARB) request for authorization of 
California's amendments to its Spark Ignition Marine Engine and Boat 
regulations (2008 amendments). EPA's decision also confirms that 
certain of the 2008 amendments are within the scope of prior EPA 
authorizations. The 2008 amendments apply to spark ignition marine 
outboard motors, personal watercraft, and stern drive and inboard 
engines subject to California emissions regulations. This decision is 
issued under the authority of the Clean Air Act (CAA or Act).

DATES: Petitions for review must be filed by July 6, 2015.

ADDRESSES: EPA has established a docket for this Notice of Decision 
under Docket ID EPA-HQ-OAR-2013-0024. All documents relied upon in 
making this decision, including those submitted to EPA by CARB, are 
contained in the public docket. Publicly available docket materials are 
available either electronically through www.regulations.gov or in hard 
copy at the Air and Radiation Docket in the EPA Headquarters Library, 
EPA West Building, Room 3334, located at 1301 Constitution Avenue NW., 
Washington, DC. The Public Reading Room is open from 8:30 a.m. to 4:30 
p.m.; Monday through Friday, excluding legal holidays. The telephone 
number for the Reading Room is (202) 566-1744. The Air and Radiation 
Docket and Information Center's Web site is http://www.epa.gov/oar/docket.html. The email address for the Air and Radiation Docket is: a-and-r-Docket@epa.gov, the telephone number is (202) 566-1742, and the 
fax number is (202) 566-9744. An electronic version of the public 
docket is available through the federal government's electronic public 
docket and comment system. You may access EPA dockets at http://www.regulations.gov. After opening the www.regulations.gov Web site, 
enter EPA-HQ-OAR-2013-0024 in the ``Enter Keyword or ID'' fill-in box 
to view documents in the record. Although a part of the official 
docket, the public docket does not include Confidential Business 
Information (``CBI'') or other information whose disclosure is 
restricted by statute.
    EPA's Office of Transportation and Air Quality (``OTAQ'') maintains 
a Web page that contains general information on its review of 
California waiver and authorization requests. Included on that page are 
links to prior waiver Federal Register notices, some of which are cited 
in today's notice; the page can be accessed at http://www.epa.gov/otaq/cafr.htm.

FOR FURTHER INFORMATION CONTACT: Julian Davis, Attorney-Advisor, 
Compliance Division, Office of Transportation and Air Quality, U.S. 
Environmental Protection Agency, 2000 Traverwood Drive, Ann Arbor, MI 
48105. Telephone: (734) 214-4029. Fax: (734) 214-4053. Email: 
davis.julian@epa.gov.

SUPPLEMENTARY INFORMATION:

I. Background

    By letter dated November 30, 2012, CARB submitted a request to EPA 
for authorization of amendments to the California Spark Ignition (SI) 
Marine Engine and Boat regulations \1\ (Marine SI regulations) pursuant 
to section 209(e) of the CAA (2008 amendments).\2\ The 2008 amendments 
were adopted by CARB on June 24, 2008, and became operative state law 
on August 19, 2009.\3\ The 2008 amendments update and clarify 
regulations California adopted in 1998, 2001, and 2006.\4\ CARB refers 
to these regulations collectively as the Marine Spark Ignition Engine 
regulations (Marine SI regulations).
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    \1\ 13 California Code of Regulations (CCR), sections 2111, 
2112, Appendix A therein, 2139, 2147, 2440, 2441, 2442, 2443.1, 
2443.2, 2443.3, 2444.1, 2444.2, 2445.1, 2445.2, 2447, 2474 and 2448.
    \2\ ``Clean Air Act section 209(e)(2) Authorization Support 
Document submitted by the California Air Resources Board, November 
30, 2012,'' at EPA-HQ-OAR-2013-0024-0006 (Authorization Support 
Document).
    \3\ EPA-HQ-OAR-2013-0024-0003.
    \4\ In 2007 EPA granted California authorization to enforce 
CARB's marine spark ignition engine regulations for outboard/
personal watercraft (OB/PWC) engines and Tier 1 of the California 
inboard/stern drive (IB/SD marine emission standards, see 72 FR 
14546 (March 28, 2007). In 2011 EPA granted California authorization 
to enforce CARB's second tier (Tier II) standards for spark ignited 
inboard and stern drive marine engines, see 76 FR 24872 (May 3, 
2011).
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    California's 1998 regulation established exhaust emission standards 
for outboard engines and personal watercraft. The 1998 regulation also 
established an accelerated

[[Page 26033]]

implementation schedule such that California's marine spark ignition 
standards would take effect in 2001, compared to a 2006 effective date 
for federal marine SI standards. CARB adopted emission standards for 
inboard and stern drive engines in 2001 and amended the regulation in 
2006 to provide industry with additional flexibility for complying with 
the exhaust standards.
    The 2008 amendments considered here address technical issues that 
CARB identified as developing between 2006 and 2008, make 
clarifications and correct cross-referencing errors among CARB marine 
SI provisions, modify or change emission standards and options, and 
enhance alignment between the Marine SI regulations and other CARB and 
EPA regulations.

A. California's Authorization Request

    The 2008 amendments establish new standards relating to the control 
of emissions from marine SI products, clarify procedures, add new 
flexibility for marine manufacturers, and/or correct outdated 
references in the California regulations. The 2008 amendments package 
also includes provisions that CARB deems not preempted by the Act and 
that do not require EPA authorization. Those amendments are not part of 
California's authorization request and are not included in this 
discussion.\5\
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    \5\ Authorization Support Document at 4. EPA takes no position 
as to whether such provisions are subject to preemption in section 
209(a) of the Act.
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    California requested EPA perform two types of review. First, CARB 
requested an EPA determination that certain provisions of the 2008 
amendments are within the scope of the prior authorizations, or in the 
alternative, merit full authorization. These provisions include: (1) An 
update to California's aftermarket exemption procedures to fix a cross-
referencing error that resulted when CARB adopted new stern drive/
inboard (SD/I) engine standards in 2001; (2) The addition of a new tier 
of voluntary emission standards; (3) The addition of three new test 
cycle options for certification of high performance engines; (4) A new 
option enabling use of portable emission testing systems for 
certification testing of high performance SD/I engines produced in very 
low volumes; (5) A change allowing optional use of assigned 
deterioration factors for high performance engines; (6) New optional 
engine discontinuation allowances for manufacturers of SD/I engines; 
(7) New hardship relief and compliance assistance petition processes; 
(8) Revised requirements for marine on-board diagnostics systems; (9) 
New replacement engine flexibility; and (10) Modification to exhaust 
standards for high performance SD/I engines.\6\
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    \6\ Authorization Support Document at. 3.
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    Second, CARB requested full authorization for amendments that 
revise standards or establish new requirements. These provisions 
include: (1) Revised total hydrocarbon plus oxides of nitrogen (HC + 
NOX) emission standards; (2) Enhanced evaporative emission 
controls for high performance SD/I engines; (3) Not-to-exceed limits 
for most marine SI engine categories; (4) Revised jet boat engine 
standards; and (5) New carbon monoxide emission standards.\7\
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    \7\ Authorization Support Document at 3.
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B. Clean Air Act Nonroad Engine and Vehicle Authorizations

    Section 209(e)(1) of the Act permanently preempts any state, or 
political subdivision thereof, from adopting or attempting to enforce 
any standard or other requirement relating to the control of emissions 
for certain new nonroad engines or vehicles.\8\ For all other nonroad 
engines, states generally are preempted from adopting and enforcing 
standards and other requirements relating to the control of emissions. 
Section 209(e)(2), however, requires the Administrator, after notice 
and opportunity for public hearing, to authorize California to adopt 
and enforce standards and other requirements relating to the control of 
emissions from such vehicles or engines if California determines that 
California standards will be, in the aggregate, at least as protective 
of public health and welfare as applicable Federal standards. However, 
EPA shall not grant such authorization if it finds that: (1) The 
determination of California is arbitrary and capricious; (2) California 
does not need such California standards to meet compelling and 
extraordinary conditions; or (3) California standards and accompanying 
enforcement procedures are not consistent with [CAA section 209].\9\
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    \8\ States are expressly preempted from adopting or attempting 
to enforce any standard or other requirement relating to the control 
of emissions from new nonroad engines which are used in construction 
equipment or vehicles or used in farm equipment or vehicles and 
which are smaller than 175 horsepower. Such express preemption under 
section 209(e)(1) of the Act also applies to new locomotives or new 
engines used in locomotives.
    CAA section 209(e)(1), 42 U.S.C. 7543(e)(1)(A).
    \9\ EPA's review of California regulations under section 209 is 
not a broad review of the reasonableness of the regulations or its 
compatibility with all other laws. Sections 209(b) and 209(e) of the 
Clean Air Act limit EPA's authority to deny California requests for 
waivers and authorizations to the three criteria listed therein. As 
a result, EPA has consistently refrained from denying California's 
requests for waivers and authorizations based on any other criteria. 
In instances where the U.S. Court of Appeals has reviewed EPA 
decisions declining to deny waiver requests based on criteria not 
found in section 209(b), the Court has upheld and agreed with EPA's 
determination. See Motor and Equipment Manufacturers Ass'n v. 
Nichols, 142 F.3d 449, 462-63, 466-67 (D.C. Cir. 1998), Motor and 
Equipment Manufacturers Ass'n v. EPA, 627 F.2d 1095, 1111, 1114-20 
(D.C. Cir. 1979). See also 78 FR 58090, 58120 (September 20, 2013).
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    On July 20, 1994, EPA promulgated a rule interpreting the three 
criteria set forth in section 209(e)(2)(A) that EPA must consider 
before granting any California authorization request for nonroad engine 
or vehicle emission standards.\10\ EPA revised these regulations in 
1997.\11\ As stated in the preamble to the 1994 rule, EPA historically 
has interpreted the consistency inquiry under the third criterion, 
outlined above and set forth in section 209(e)(2)(A)(iii), to require, 
at minimum, that California standards and enforcement procedures be 
consistent with sections 209(a), 209(e)(1), and 209(b)(1)(C) of the 
Act.\12\
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    \10\ See ``Air Pollution Control; Preemption of State Regulation 
for Nonroad Engine and Vehicle Standards,'' 59 FR 36969 (July 20, 
1994).
    \11\ See ``Control of Air Pollution: Emission Standards for New 
Nonroad Compression-Ignition Engines at or Above 37 Kilowatts; 
Preemption of State Regulation for Nonroad Engine and Vehicle 
Standards; Amendments to Rules,'' 62 FR 67733 (December 30, 1997). 
The applicable regulations are now found in 40 CFR part 1074, 
subpart B, section 1074.105.
    \12\ 59 FR 36969 (July 20, 1994). EPA has interpreted 
209(b)(1)(C) in the context of section 209(b) motor vehicle waivers.
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    In order to be consistent with section 209(a), California's nonroad 
standards and enforcement procedures must not apply to new motor 
vehicles or new motor vehicle engines. To be consistent with section 
209(e)(1), California's nonroad standards and enforcement procedures 
must not attempt to regulate engine categories that are permanently 
preempted from state regulation. To determine consistency with section 
209(b)(1)(C), EPA typically reviews nonroad authorization requests 
under the same ``consistency'' criteria that are applied to motor 
vehicle waiver requests under section 209(b)(1)(C). That provision 
provides that the Administrator shall not grant California a motor 
vehicle waiver if she finds that California ``standards and 
accompanying enforcement procedures are not consistent with section 
202(a)'' of the Act. Previous decisions granting waivers and 
authorizations have noted that state standards and enforcement 
procedures will be found to be inconsistent with section 202(a) if: (1) 
There is inadequate lead time to permit

[[Page 26034]]

the development of the necessary technology, giving appropriate 
consideration to the cost of compliance within that time,\13\ or (2) 
the federal and state testing procedures impose inconsistent 
certification requirements.\14\
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    \13\ H. Rep. No. 728, 90th Cong., 1st Sess. 21 (1967).
    \14\ S. Rep. No. 403, 90th Cong., 1st Sess. 32 (1967).
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    In light of the similar language in sections 209(b) and 
209(e)(2)(A), EPA has reviewed California's requests for authorization 
of nonroad vehicle or engine standards under section 209(e)(2)(A) using 
the same principles that it has historically applied in reviewing 
requests for waivers of preemption for new motor vehicle or new motor 
vehicle engine standards under section 209(b).\15\ These principles 
include, among other things, that EPA should limit its inquiry to the 
three specific authorization criteria identified in section 
209(e)(2)(A),\16\ and that EPA should give substantial deference to the 
policy judgments California has made in adopting its regulations. In 
previous waiver decisions, EPA has stated that Congress intended EPA's 
review of California's decision-making be narrow. EPA has rejected 
arguments that are not specified in the statute as grounds for denying 
a waiver: The law makes it clear that the waiver requests cannot be 
denied unless the specific findings designated in the statute can 
properly be made. The issue of whether a proposed California 
requirement is likely to result in only marginal improvement in 
California air quality not commensurate with its costs or is otherwise 
an arguably unwise exercise of regulatory power is not legally 
pertinent to my decision under section 209, so long as the California 
requirement is consistent with section 202(a) and is more stringent 
than applicable Federal requirements in the sense that it may result in 
some further reduction in air pollution in California.\17\
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    \15\ See Engine Manufacturers Association v. EPA, 88 F.3d 1075, 
1087 (D.C. Cir. 1996): ``. . . EPA was within the bounds of 
permissible construction in analogizing Sec.  209(e) on nonroad 
sources to Sec.  209(a) on motor vehicles.''
    \16\ See EPA's Final 209(e) rulemaking at 59 FR 36969, 36983 
(July 20, 1994).
    \17\ ``Waiver of Application of Clean Air Act to California 
State Standards,'' 36 FR 17458 (Aug. 31, 1971). Note that the more 
stringent standard expressed here, in 1971, was superseded by the 
1977 amendments to section 209, which established that California 
must determine that its standards are, in the aggregate, at least as 
protective of public health and welfare as applicable Federal 
standards. In the 1990 amendments to section 209, Congress 
established section 209(e) and similar language in section 
209(e)(1)(i) pertaining to California's nonroad emission standards 
which California must determine to be, in the aggregate, at least as 
protective of public health and welfare as applicable federal 
standards.
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    This principle of narrow EPA review has been upheld by the U.S. 
Court of Appeals for the District of Columbia Circuit.\18\ Thus, EPA's 
consideration of all the evidence submitted concerning an authorization 
decision is circumscribed by its relevance to those questions that may 
be considered under section 209(e)(2)(A).
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    \18\ See, e.g., Motor and Equip. Mfrs Assoc. v. EPA, 627 F.2d 
1095 (D.C. Cir. 1979) (``MEMA I'').
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C. Within-the-Scope Determinations

    If California amends regulations that have been previously 
authorized by EPA, California may ask EPA to determine that the 
amendments are within the scope of the earlier authorization. A within-
the-scope determination for such amendments is permissible without a 
full authorization review if three conditions are met. First, the 
amended regulations must not undermine California's previous 
determination that its standards, in the aggregate, are as protective 
of public health and welfare as applicable federal standards. Second, 
the amended regulations must not affect consistency with section 209 of 
the Act, following the same criteria discussed above in the context of 
full authorizations. Third, the amended regulations must not raise any 
new issues affecting EPA's prior waiver or authorization decisions.\19\
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    \19\ See ``California State Motor Vehicle Pollution Control 
Standards; Amendments Within the Scope of Previous Waiver of Federal 
Preemption,'' 46 FR 36742 (July 15, 1981).
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D. Deference to California

    In previous waiver decisions, EPA has recognized that the intent of 
Congress in creating a limited review based on the section 209(b)(1) 
criteria was to ensure that the federal government did not second-guess 
state policy choices. As the agency explained in one prior waiver 
decision:

It is worth noting * * * I would feel constrained to approve a 
California approach to the problem which I might also feel unable to 
adopt at the federal level in my own capacity as a regulator. The 
whole approach of the Clean Air Act is to force the development of 
new types of emission control technology where that is needed by 
compelling the industry to ``catch up'' to some degree with newly 
promulgated standards. Such an approach * * * may be attended with 
costs, in the shape of reduced product offering, or price or fuel 
economy penalties, and by risks that a wider number of vehicle 
classes may not be able to complete their development work in time. 
Since a balancing of these risks and costs against the potential 
benefits from reduced emissions is a central policy decision for any 
regulatory agency under the statutory scheme outlined above, I 
believe I am required to give very substantial deference to 
California's judgments on this score.\20\
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    \20\ 40 FR 23102, 23103-23104 (May 28, 1975).

    Similarly, EPA has stated that the text, structure, and history of 
the California waiver provision clearly indicate both a congressional 
intent and appropriate EPA practice of leaving the decision on 
``ambiguous and controversial matters of public policy'' to 
California's judgment.\21\ This interpretation is supported by relevant 
discussion in the House Committee Report for the 1977 amendments to the 
Clean Air Act.\22\ Congress had the opportunity through the 1977 
amendments to restrict the preexisting waiver provision, but elected 
instead to expand California's flexibility to adopt a complete program 
of motor vehicle emission controls. The report explains that the 
amendment is intended to ratify and strengthen the preexisting 
California waiver provision and to affirm the underlying intent of that 
provision, that is, to afford California the broadest possible 
discretion in selecting the best means to protect the health of its 
citizens and the public welfare.\23\
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    \21\ Id. at 23104; 58 FR 4166 (January 13, 1993).
    \22\ MEMA I, 627 F.2d at 1110 (citing H.R. Rep. No. 294, 95th 
Cong., 1st Sess. 301-302 (1977)).
    \23\ Id.
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E. Burden and Standard of Proof

    As the U.S. Court of Appeals for the DC Circuit has made clear in 
MEMA I, opponents of a California waiver request bear the burden of 
showing that the statutory criteria for a denial of the request have 
been met:

[T]he language of the statute and its legislative history indicate 
that California's regulations, and California's determinations that 
they must comply with the statute, when presented to the 
Administrator are presumed to satisfy the waiver requirements and 
that the burden of proving otherwise is on whoever attacks them. 
California must present its regulations and findings at the hearing 
and thereafter the parties opposing the waiver request bear the 
burden of persuading the Administrator that the waiver request 
should be denied.\24\
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    \24\ MEMA I, at 1121.

    The Administrator's burden, on the other hand, is to make a 
reasonable evaluation of the information in the record in coming to the 
waiver decision. As the court in MEMA I stated: ``here, too, if the 
Administrator ignores evidence demonstrating that the waiver should not 
be granted, or if he seeks to overcome that evidence with unsupported 
assumptions of his own, he runs the risk of having his waiver decision 
set aside as `arbitrary and

[[Page 26035]]

capricious.' '' \25\ Therefore, the Administrator's burden is to act 
``reasonably.'' \26\
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    \25\ Id. at 1126.
    \26\ Id. at 1126.
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    With regard to the standard of proof, the court in MEMA I explained 
that the Administrator's role in a section 209 proceeding is to:

[. . .]consider all evidence that passes the threshold test of 
materiality and * * * thereafter assess such material evidence 
against a standard of proof to determine whether the parties 
favoring a denial of the waiver have shown that the factual 
circumstances exist in which Congress intended a denial of the 
waiver.\27\
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    \27\ Id. at 1122.

    In that decision, the court considered the standards of proof under 
section 209 for the two findings related to granting a waiver for an 
``accompanying enforcement procedure.'' Those findings involve: (1) 
Whether the enforcement procedures impact California's prior 
protectiveness determination for the associated standards, and (2) 
whether the procedures are consistent with section 202(a). The 
principles set forth by the court, however, are similarly applicable to 
an EPA review of a request for a waiver of preemption for a standard. 
The court instructed that ``the standard of proof must take account of 
the nature of the risk of error involved in any given decision, and it 
therefore varies with the finding involved. We need not decide how this 
standard operates in every waiver decision.'' \28\
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    \28\ Id.
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    With regard to the protectiveness finding, the court upheld the 
Administrator's position that, to deny a waiver, there must be ``clear 
and compelling evidence'' to show that proposed enforcement procedures 
undermine the protectiveness of California's standards.\29\ The court 
noted that this standard of proof also accords with the congressional 
intent to provide California with the broadest possible discretion in 
setting regulations it finds protective of the public health and 
welfare.\30\
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    \29\ Id.
    \30\ Id.
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    With respect to the consistency finding, the court did not 
articulate a standard of proof applicable to all proceedings, but found 
that the opponents of the waiver were unable to meet their burden of 
proof even if the standard were a mere preponderance of the evidence. 
Although MEMA I did not explicitly consider what the standards of proof 
would be under section 209 concerning a waiver request for 
``standards,'' as compared to a waiver request for accompanying 
enforcement procedures, there is nothing in the opinion to suggest that 
the court's analysis would not apply with equal force to such 
determinations. EPA's past waiver decisions have consistently made 
clear that: ``[E]ven in the two areas concededly reserved for Federal 
judgment by this legislation--the existence of `compelling and 
extraordinary' conditions and whether the standards are technologically 
feasible--Congress intended that the standards of EPA review of the 
State decision to be a narrow one.'' \31\
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    \31\ See, e.g., ``California State Motor Vehicle Pollution 
Control Standards; Waiver of Federal Preemption,'' 40 FR 23102 (May 
28, 1975), at 23103.
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F. EPA's Administrative Process in Consideration of California's 
Request for Authorization of the 2008 Amendments

    The CAA directs EPA to offer an opportunity for public hearing on 
authorization requests from California. On August 19, 2013, EPA 
published a Federal Register notice announcing an opportunity for 
written comment and offering a public hearing on California's request 
for authorization of the 2008 amendments.\32\ The request for comments 
specifically included, but was not limited to, the following issues.
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    \32\ 78 FR 50412 (August 19, 2013).
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    First, EPA requested comment on whether the 2008 amendments for 
which CARB requested a within-the-scope determination should be 
considered under a within-the-scope analysis. We specifically requested 
comment on whether those amendments, each individually assessed, (1) 
undermine California's previous determination that its standards, in 
the aggregate, are at least as protective of public health and welfare 
as comparable federal standards, (2) affect the consistency of 
California's requirement with section 209 of the Act, or (3) raise any 
other new issue affecting EPA's previous authorization determinations.
    Second, EPA requested comment on whether those amendments would 
satisfy the criteria for full authorization if they do not meet the 
criteria for within-the-scope analysis.
    Third, EPA sought comment on whether the amendments establishing 
new emission standards for which CARB requested full authorization 
satisfy the full authorization criteria. We specifically requested 
comment on whether: (1) California's protectiveness determination for 
these amendments (i.e., that California standards will be, in the 
aggregate, as protective of public health and welfare as applicable 
federal standards) is arbitrary and capricious, (2) California does not 
need such standards to meet compelling and extraordinary conditions, or 
(3) the California standards and accompanying enforcement procedures 
are not consistent with section 209 of the Act.
    EPA received no written comments in response to its request, and 
received no request for a public hearing. Consequently, EPA did not 
hold a public hearing.

II. Discussion

 A. Within-the-Scope Analysis

    CARB's request sought confirmation that 10 of the 2008 amendments 
fall within the scope of prior marine SI authorizations. EPA can 
confirm that amended regulations are within the scope of previously 
granted authorizations if three conditions are met. First, the amended 
regulations must not undermine California's determination that its 
standards, in the aggregate, are as protective of public health and 
welfare as applicable federal standards. Second, the amended 
regulations must not affect the consistency of the Marine SI 
regulations with section 209. Third, the amendments must not raise any 
``new issues'' affecting the prior authorization. If EPA determines 
that the amendments do not meet the requirements for a within-the-scope 
confirmation, we then consider whether the amendments satisfy the 
criteria for full authorization.
    As described previously, EPA specifically invited comment on the 
appropriateness of California's request for within-the-scope versus 
full authorization treatment for 10 of the 2008 amendments. We received 
no comment on this issue.
    We conducted our analysis by evaluating each of the 10 amendments 
against each within-the-scope criterion. The discussion below briefly 
summarizes the amendments and then presents our analysis. To avoid 
repetition, we present a single explanation when the same analysis and 
evaluation applies to multiple amendments, due to their similarity in 
design or impact. The amendments fall into three broad categories: (1) 
Changes that correct errors or clarify the existing regulation; (2) 
changes that add new compliance flexibility for marine SI 
manufacturers; and (3) changes that modify or adjust emission standards 
or requirements.
1. Amendments That Correct Errors or Clarify the Existing Regulation
    Two amendments fall into this first category. The Aftermarket 
Exemption

[[Page 26036]]

Procedures Clarification Amendment (aftermarket exemptions amendment) 
corrects a cross-referencing error for SD/I parts manufacturers. When 
California adopted emission standards for SD/I engines in 2001, a 
corresponding adjustment to the aftermarket exemption procedures did 
not occur. The 2008 amendments correct this error by removing the 
exclusion of eligibility for an aftermarket exemption for SD/I parts. 
The change thus aligns provisions covering emission standards, 
aftermarket exemptions, and exemption applicability for SD/I engines.
    The Replacement Engine Provisions Amendment (replacement engines 
amendment) addresses a practical problem that resulted from 
California's previous requirement that new SD/I replacement engines 
comply with current model year emission standards. The requirement 
unintentionally necessitated use of a catalyst-equipped engine to 
replace the engine in an older model boat, even if the boat was not 
properly designed to accommodate or support a catalyst-equipped engine. 
The replacement engines amendment requires the installation of the 
cleanest available engine in a boat without unreasonable modifications 
when replacing an existing engine.
    As described above, California's aftermarket exemption amendment 
corrects a cross-referencing error by clarifying that the aftermarket 
parts exemption applicable to other off-road categories also applies 
and is available to SD/I manufacturers. The replacement engine 
provisions amendment addresses a conflict in the previous regulations 
that unintentionally established infeasible requirements for some SD/I 
engine replacements. These amendments simply clarify and codify the 
intent of the Marine SI regulations EPA previously authorized. The 
modifications therefore do not change the basis for California's 
previous protectiveness determination, which EPA in its earlier 
authorization found not to be arbitrary or capricious. Based on the 
record associated with this request, EPA cannot find that the 
aftermarket exemption procedures or replacement engine amendments 
undermine California's previous determination that its standards, in 
the aggregate, are at least as protective of public health and welfare 
as comparable federal standards.
    EPA similarly finds that the aftermarket parts and replacement 
engines provisions do not affect consistency with section 209 of the 
Act. These two amendments do not broaden applicability of the Marine SI 
regulations to preempted vehicle or engine categories under sections 
209(a) or 209(e)(1). The aftermarket parts amendment involves 
correction of a cross-referencing error in California's law that has no 
bearing on technological feasibility, cost, or test procedures. The 
replacement engines amendment also has no bearing on test procedures 
and indeed provides clarification to ensure that the replacement engine 
provisions under the Marine SI regulations do not present problems with 
technological feasibility or cost. In light of the information 
available to us we cannot find these two amendments to be inconsistent 
with section 202(a) of the Act.
    Finally, EPA must evaluate whether California's aftermarket parts 
amendment or engine replacement amendment raise new issues affecting 
previously granted authorizations. These amendments do not change 
provisions of the previously authorized regulations, other than to 
correct administrative oversights in the regulations that 
unintentionally limited implementation flexibility for SD/I 
manufacturers. Therefore, we do not find that the amendments impose new 
concerns or affect the bases upon which EPA granted the previous 
authorization. EPA cannot find that CARB's aftermarket exemptions or 
engine replacement amendments raise new issues and consequently cannot 
deny CARB's request based on this criterion.
    For all the reasons set forth above, EPA confirms that California's 
aftermarket exemptions and replacement engine amendments are within the 
scope of the existing authorization.
2. Amendments That Add New Compliance Options, Flexibility, or 
Assistance
    California requested within-the-scope confirmation for six 
amendments that either broaden availability of compliance assistance or 
provide flexibility by establishing new options for manufacturers to 
demonstrate compliance with the Marine SI regulations.
    The Compliance Assistance for All Spark-Ignition Marine Engines 
Amendment (compliance assistance amendment) gives California's 
Executive Officer discretion to issue additional compliance assistance 
in cases of extreme hardship for which the engine discontinuation 
allowance may not be completely adequate. This assistance would not be 
automatically available. Rather, assistance would depend on an 
evaluation of whether the manufacturer seeking such assistance 
demonstrated that the cause of the hardship was beyond its control, 
that the manufacturer had already attempted to resolve the situation by 
exercising all existing regulatory provisions, and that the 
manufacturer had proposed an effective, implementable and enforceable 
plan to prevent any net increase in emissions.
    The Optional Fifth Tier Added to Environmental Label Program 
Amendment (environmental label amendment) enables manufacturers to 
certify marine SI engines to a new, more stringent tier of voluntary 
emission standards and thereby become eligible for a new five-star 
emissions rating. The previously authorized regulations provided for a 
four-tier environmental label program.
    The Optional Loaded Test Cycle for High Performance Engines 
Amendment (HPE test cycle amendment) establishes a new testing option 
for manufacturers certifying high performance (>373kW) SD/I engines. 
The new, optional HPE test cycle is similar to the steady-state test 
cycle that California's previously authorized Marine SI regulations 
designate for HPE certification testing. But instead of measuring 
emissions at a ``no load'' idle, the test is run at a 15-percent load 
(``loaded idle''). High performance engines typically operate at loaded 
idle since much of their operation occurs in ``no-wake'' zones near 
docks and swimming areas where the speed limit is five mile per hour. 
CARB states that the loaded idle operation is therefore more 
representative of HPE operation than ``no load'' idle operation.
    The Optional Portable Emissions Measurement System (PEMS) for High 
Performance Engines Amendment (PEMS amendment) provides another new 
testing option for certification of certain high performance SD/I 
engines. This amendment allows manufacturers that produce no more than 
75 engines per year nationally to use PEMS equipment to conduct 
certification testing. Eligible PEMS units must comply with the same 
specifications and verifications as the laboratory instrumentation 
described in the marine SI engine test procedures, but with added 
flexibility per California's incorporation of the provisions for 
portable measurement systems set forth in federal regulations.\33\
---------------------------------------------------------------------------

    \33\ See 40 CFR 1065.901 through 1065.940.
---------------------------------------------------------------------------

    The Optional Assigned Deterioration Factors (DF) for High 
Performance Engines Amendment (assigned DF amendment) adds an option 
for manufacturers to use assigned DFs to demonstrate at the time of 
certification that an engine will meet the full useful

[[Page 26037]]

life standards. Emissions deterioration over a HPE's useful life is 
expected to be relatively small considering an engine's 50-hour or 150-
hour rebuild frequency. California states that the assignment of 
reasonable deterioration factors provides HPE manufacturers a cost 
effective and low-risk alternative to the traditional method of 
determining deterioration factors.
    The Optional Engine Discontinuation Allowance for SD/I Engines 
Amendment (engine discontinuation allowance amendment) establishes an 
optional flexibility that allows manufacturers to certify one engine 
family per year to current emission certification levels if certifying 
one or more other SD/I engine families to more stringent standards to 
make up for the emissions deficit. This provision addresses a 
compliance obstacle that arose after CARB adopted its 2005 marine 
regulations. Engine marinizers (manufacturers who modify existing 
automobile engines to operate in a marine environment) encountered the 
unanticipated discontinuation of engines by base engine suppliers and 
lacked the time necessary to develop reliable emission control systems 
for the engines that replace them. California states that the engine 
discontinuation allowance amendment offers a solution by providing 
marinizers a flexible alternative in limited situations when a 
currently compliant engine is no longer available, without a negative 
impact on emissions.
    EPA again applied the three-prong test for a within-the-scope 
confirmation to the six amendments summarized above.
    First, California asserts that the six amendments, and indeed all 
of the 2008 amendments, either reduce emissions or are emissions 
neutral. These six amendments in particular provide new, voluntary 
flexibilities meant only to enhance the marine SI industry's ability to 
comply with CARB's previously authorized regulations. Our analysis 
found no reason to conclude that the expanded compliance options would 
reduce the protectiveness of California's Marine SI regulations, or 
change the basis for California's previous protectiveness 
determination, which EPA in its earlier authorization found not to be 
arbitrary or capricious. EPA received no comment on this issue. 
Therefore, based on the record associated with this request, EPA cannot 
find that the compliance assistance, environmental label, HPE test 
cycle, PEMS, assigned DF, or engine discontinuation allowance 
amendments undermine California's previous determination that its 
standards, in the aggregate, are at least as protective of public 
health and welfare as comparable federal standards,
    Second, EPA must evaluate whether any of the six amendments render 
California's Marine SI regulations inconsistent with section 209 of the 
Act. Our review again finds that none of the six amendments broadens, 
or attempts to broaden, the applicability of the Marine SI regulations 
to cover either motor vehicles or nonroad engines expressly preempted 
under section 209(a) or section 209(e)(1). Similarly, the amendments, 
all voluntary and designed to provide flexibility, do not present 
technologically infeasible requirements relative to lead time or 
consistency with federal testing requirements.
    For the foregoing reasons we find that the six amendments discussed 
in this section satisfy the second criterion for within-the-scope 
confirmation.
    Finally, under the third prong of a within-the-scope analysis, EPA 
evaluates whether any of the six amendments constitutes a new issue 
affecting the prior authorization. These six amendments either promote 
the use of existing compliance flexibilities or create a new 
flexibility to assist manufacturers in achieving compliance with 
California's standards. They do not establish new requirements or 
obligations. As such, EPA cannot find that the amendments constitute 
any new issues that would affect our prior authorization of 
California's Marine SI regulations, and cannot deny CARB's request 
based on this third within-the-scope criterion.
    For all the reasons set forth above, EPA confirms that California's 
compliance assistance, environmental label, HPE test cycle, PEMS, 
assigned DF, and engine discontinuation allowance amendments are within 
the scope of the existing authorization.
3. Amendments That Modify or Change Emission Standards or Requirements
    California also requested within-the-scope confirmation for 
amendments that change requirements for some marine onboard diagnostic 
systems and that adjust exhaust standards for some SD/I engines.
    The Revised On-Board Diagnostics Marine (OBD-M) Requirements 
Amendment (OBD-M amendment) requires the onboard diagnostic system on 
all SD/I engines and boats to include a misfire monitor. Prior to the 
2008 amendments, the misfire monitor requirement was conditional. The 
previously authorized regulations only required misfire monitoring when 
CARB or the certifying manufacturer determined that engine misfire 
would cause the catalyst to fail before the emissions durability period 
of the engine had elapsed. The OBD-M amendment also extends the 
compliance date to allow for the deployment of more sophisticated on-
board computers and temporarily relaxes requirements for malfunction 
indicator light activation.
    The Modification of Exhaust Standards for High Performance SD/I 
Engines Amendment (HPE exhaust standards amendment) relaxes 
California's total hydrocarbon and oxides of nitrogen 
(HC+NOX) exhaust standard for 2009 and later model year high 
performance SD/I engines produced by small volume manufacturers.
    California asserts that the OBD-M and the HPE exhaust standards 
amendments, like the other eight amendments presented for within-the-
scope confirmation, satisfy all the criteria, including the third 
criterion, that the amendments do not raise any new issues affecting 
the prior authorization.
    Beginning with the OBD-M amendment, California notes that the 
change from the previous conditional requirement to the mandate for 
misfire monitors does not represent a new requirement because all SD/I 
manufacturers, in practice, already voluntarily include misfire 
monitoring as part of their OBD-M systems. In 2006, when California 
adopted its original OBD-M requirements, industry believed that misfire 
monitors generally would not be necessary for SD/I engines certified to 
California's 5.0 gram per kilowatt-hour (g/kW-hr) non-methane 
hydrocarbon plus nitrogen oxides (NMHC+NOX) standard.\34\ 
Rather, industry contended and CARB agreed that misfire would not 
affect catalyst durability because marine catalysts would need to be 
extraordinarily robust to meet that standard and remain durable in a 
water environment. However, industry has since learned that special 
catalysts are not necessary. Instead manufacturers are using 
conventional catalysts in California-certified SD/I engines. These 
catalysts are susceptible to damage from engine misfire and 
manufacturers therefore are subject to the conditional misfire monitor 
requirement established under

[[Page 26038]]

the previously authorized Marine SI regulations.
---------------------------------------------------------------------------

    \34\ CARB amended its marine standards to reflect the total 
hydrocarbon species instead of the previous ``non-methane'' 
hydrocarbon species to recognize methane's role as a greenhouse gas. 
See discussion below, under full authorization analysis, and 
Authorization Support Document at pp. 8-9.
---------------------------------------------------------------------------

    California maintains that there would be no difference in 
converting the conditional misfire monitoring program into a mandate 
because all manufacturers providing information to California in 
actuality already include a misfire monitor in their OBD-M systems.
    EPA appreciates California's argument that the practical impact of 
the OBD-M amendment is negligible, and perhaps even nonexistent. 
However, we do not agree with California's view that the change from a 
conditional requirement to a comprehensive mandatory requirement under 
the OBD-M amendment ``does not mandate a new system or require 
appreciable hardware changes.'' \35\ The possibility is arguably still 
present that the OBD-M amendment would require a manufacturer using a 
robust catalyst technology to include a misfire monitor in the OBD-M 
system, where previously such a requirement did not exist. If true, 
this would constitute a new requirement under the mandatory system that 
did not exist under the conditional system we previously authorized. 
EPA finds that the OBD-M amendment does indeed present a new issue and 
therefore cannot be confirmed as within the scope of the previous 
authorization. Therefore EPA considers the OBD-M amendment under the 
full authorization criteria, as discussed below.
---------------------------------------------------------------------------

    \35\ Id.
---------------------------------------------------------------------------

    The HPE exhaust standards amendment, like several of the 2008 
amendments, is designed to address obstacles that manufacturers faced 
in attempting to comply with California's Marine SI regulations. The 
HPE sector involves a relatively small number of manufacturers that 
cumulatively sell between 200-250 new engines in California each year. 
The previously authorized regulations allowed manufacturers to average 
standard performance and high performance engine family emission levels 
within their product line as a means to facilitate compliance. However, 
manufacturers encountered technical obstacles regarding the effective 
use of catalytic converters on high performance engines. In addition, a 
competitive disadvantage existed for small volume manufacturers that 
did not have requisite standard engines to generate offsets for their 
HPEs. The HPE exhaust standards amendment responds to these concerns by 
relaxing the model year 2009 and later HC+NOX exhaust 
standard for small volume HPE manufacturers.
    California states that any emissions shortfall resulting from the 
relaxation of standards by the HPE exhaust standards amendment will be 
offset by emissions reductions achieved through another provision in 
the 2008 amendments package. That provision establishes enhanced 
evaporative emissions control requirements for high performance SD/I 
engines. CARB requested full authorization for that amendment, as 
described in the following section of this document. California 
contends that the HPE exhaust standards amendment satisfies the 
criteria for within-the-scope confirmation because it does not impose 
new requirements and because it will not affect CARB's previous 
protectiveness determination, considering the emissions compensation 
achieved within the full set of 2008 amendments.
    EPA agrees with CARB's interpretation that the HPE exhaust 
standards amendment does not impose any new, more stringent 
requirements, relative to the previously authorized regulations. EPA 
also agrees that the emissions impact of the relaxed HC+NOX 
standard will be small and may in fact be nil overall, given the 
compensating effect of another provision that will reduce evaporative 
emissions from high performance SD/I engines. However CARB expressly 
states that the evaporative controls amendment was established to 
compensate for the shortfall in emission benefits from the change in 
exhaust standards. Because CARB links the two amendments, and because 
the amendment establishing the enhanced evaporative emission controls 
requires full authorization, EPA cannot consider the HPE exhaust 
standards amendment independently. Therefore, EPA views the HPE exhaust 
standards amendment as presenting a new issue that precludes a within-
the-scope determination.
    For the OBD-M and HPE exhaust emissions standards amendments, since 
the ``new issue'' prong of the within-the-scope criteria is not 
satisfied, EPA shall consider these amendments under the full 
authorization criteria, and will analyze them as such.\36\
---------------------------------------------------------------------------

    \36\ EPA cannot find that these amendments are within the scope 
of the previous authorization because they failed to satisfy the 
``new issue'' criterion. We must therefore proceed with a full 
authorization analysis; there is no need to analyze whether the 
other two prongs of the within-the-scope analysis are met.
---------------------------------------------------------------------------

B. Full Authorization Analysis

    California requested full authorization for five of its 2008 
amendments, each of which is summarized below. As described in the 
background section of this document, the CAA directs EPA to grant 
authorization, after providing opportunity for public hearing, unless 
EPA finds that California's protectiveness determination is arbitrary 
and capricious, that California does not need state standards to meet 
compelling and extraordinary conditions, or that the California 
standards are inconsistent with federal standards. EPA requested but 
received no comment on whether the 2008 amendments satisfy those 
criteria.
    EPA analyzed the authorization request by evaluating each of the 
five amendments for which California requested full authorization 
against each of the three authorization criteria. As explained above, 
we also evaluated against full authorization criteria the two 
amendments that EPA could not confirm to be within the scope of the 
previous marine SI authorization. The following discussion briefly 
summarizes the amendments \37\ and presents our analysis. The 
discussion combines and analyzes amendments together for brevity and 
clarity as appropriate.
---------------------------------------------------------------------------

    \37\ Summaries of the OBD-M and HPE exhaust standards amendments 
are provided in the within-the-scope amendments section of this 
document.
---------------------------------------------------------------------------

1. Summary of Full Authorization Amendments
    California has requested full authorization for five of its 2008 
amendments. We summarize these amendments below. As described in the 
background section of this document, the CAA directs EPA to grant 
authorization, after providing opportunity for public comment, unless 
EPA finds that California's protectiveness determination is arbitrary 
and capricious, that California does not need state standards to meet 
compelling and extraordinary conditions, or that the California 
standards are inconsistent with federal standards. EPA requested but 
received no comment on whether the 2008 amendments satisfy those 
criteria.
    The Revised Total Hydrocarbon plus Oxides of Nitrogen Standards 
Amendment (revised HC+NOX standards amendment) changes 
California's hydrocarbon emission standard for all spark-ignition 
marine categories from a non-methane hydrocarbon (NMHC) standard to a 
total hydrocarbon standard. The previously authorized Marine SI 
regulations did not include the methane component of HC emissions in 
the standards because California, at the time, designed the regulation 
to control ozone, and methane does not contribute to ozone formation in 
the atmosphere. However,

[[Page 26039]]

methane has been identified as a greenhouse gas that contributes to 
global warming. California therefore amended its regulations to 
acknowledge the state's now broader air pollution concerns and include 
the total hydrocarbon species in its marine SI emission standards. The 
amendment would also harmonize the form of California's marine SI 
standards with federal gasoline certification fuel standards.
    The Enhanced Evaporative Emissions Controls for High Performance 
SD/I Engines Amendment (evaporative emissions controls amendment) calls 
for boats using model year 2009 and later SD/I engines to incorporate 
enhanced evaporative emissions controls, including evaporative 
canisters and low-permeation fuel tanks and hoses. California states 
that this amendment was intended to ``compensate'' for the shortfall in 
emission benefits from the change in exhaust standards for high 
performance SD/I engines produced by small volume manufacturers, and to 
keep pace with EPA's evaporative emissions regulations published on May 
18, 2007.\38\ The evaporative emissions controls harmonize California 
evaporative emissions standards with the federal standards.
---------------------------------------------------------------------------

    \38\ 72 FR 28098, Control of Emissions from Nonroad Spark-
Ignition Engines and Equipment.
---------------------------------------------------------------------------

    The Not-to-Exceed (NTE) Limits Amendment (NTE limits amendment) 
harmonizes California NTE limits for outboard motors/personal 
watercraft (OB/PWC) and SD/I engines less than or equal to 373 kW with 
federal NTE requirements for the same engine categories. The NTE 
requirements are intended to ensure emissions control in modes of 
engine operation that are not fully represented by the certification 
test cycle.
    The Revised Jet Boat \39\ Engine Standards Amendment (jet boat 
standards amendment) enhances alignment between California and federal 
definitions for SD/I engines and jet boats, and requires manufacturers 
that were certifying jet boat engines to California's OB/PWC standards 
to instead certify them to the more stringent SD/I standards. The 2008 
amendments include several provisions intended to help facilitate the 
transition to the SD/I standards. These include enabling jet boat 
engine families previously certified to the OB/PWC standards or 
certified in a combined jet boat OB/PWC family to be certified to the 
OB/PWC standards until 2012 and establishing a transition period 
between 2010 and 2012 during which certain offsets and averaging may be 
used to comply with HC+NOX standards.
---------------------------------------------------------------------------

    \39\ CCR Section 2441(a)(32), ``Jet Boat'' means a vessel that 
uses an installed internal combustion engine powering a water jet 
pump as its primary source of propulsion and is designed with open 
area for carrying passengers.
---------------------------------------------------------------------------

    The New Carbon Monoxide Emission Standards Amendment (CO standards 
amendment) California adopted as part of the 2008 package applies to 
OB/PWC and SD/I engines. California adopted the standards, which 
essentially capped CO emissions at currently measured levels, to reduce 
CO inhalation risk for recreational boaters. The amended California CO 
standards are similar in stringency to federal standards but differ 
slightly in program design.
2. California's Protectiveness Determination
    The first criterion EPA analyzes for full authorization is whether 
California's protectiveness determination (that its standards, 
including those changed by the 2008 amendments--the OBD-M requirement, 
HPE exhaust standards, revised HC+ NOX standards, 
evaporative emissions controls, NTE limits, jet boat standards, and CO 
standards--are, in the aggregate, at least as protective of public 
health and welfare as applicable federal standards) is arbitrary and 
capricious.
    In its initial action to adopt marine SI emission regulations in 
1998, CARB determined that the Marine SI regulations were in the 
aggregate at least as protective of public health and welfare as the 
applicable federal regulations.\40\ In granting California 
authorization for the regulation, EPA affirmed that this determination 
was not arbitrary or capricious.\41\ CARB has reiterated its 
protectiveness determination with regard to the 2008 amendments so EPA 
now evaluates that determination in light of the amended marine SI 
program and current federal standards.\42\
---------------------------------------------------------------------------

    \40\ See CARB Resolution 98-63, EPA-HQ-OAR-2013-0024-0014.
    \41\ 72 FR14546 (March 28, 2007).
    \42\ Authorization Support Document at 13.
---------------------------------------------------------------------------

    As described above, CARB states that the 2008 amendments are either 
emissions neutral or increase the emissions stringency of California's 
Marine SI regulations. Specifically, California states that the revised 
HC+NOX standards, NTE limits and revised jet boat engine 
standards harmonize with federal standards while the CO standards and 
HPE exhaust standards are either of equivalent stringency or more 
stringent than the federal requirements. The HPE exhaust standards 
amendment does relax California's previous requirement somewhat, but 
only for small volume manufacturers, and the emissions increase due to 
this modification is offset by requirements within the 2008 amendments 
for enhanced evaporative emission controls on the same high-performance 
SD/I engine sector. We received no comment challenging California's 
marine SI standards as less stringent than applicable federal standards 
or refuting California's protectiveness determination. Given the lack 
of any evidence to the contrary, we cannot find that California's 
protectiveness determination regarding these amendments is arbitrary or 
capricious.
    California's OBD-M amendment requiring misfire monitoring for SD/I 
engines was intended to adjust and upgrade the OBD-M requirement that 
EPA authorized in 2007. While EPA finds that the OBD-M amendment is 
inappropriate for within-the-scope treatment, the modification from a 
conditional to a mandatory requirement increases the program's 
stringency, which would favor California's finding of protectiveness. 
There is no federal requirement for a misfire monitoring system for 
marine OBD systems, which lends support to California's determination 
that its standards are as protective, if not more so, than the federal 
standard. Therefore, as with the amended emission standards within the 
2008 amendments, we cannot find that California's protectiveness 
determination regarding the OBD-M amendment is arbitrary or capricious.
3. California's Compelling and Extraordinary Conditions
    California has asserted its longstanding position that the State 
continues to need its own nonroad engine program to meet serious air 
pollution problems.\43\ The relevant inquiry under section 
209(e)(2)(A)(ii) is whether California needs its own emission control 
program to meet compelling and extraordinary conditions, not whether 
any given standard is necessary to meet such conditions.\44\ In a 2009 
waiver action, EPA examined the language of section

[[Page 26040]]

209(b)(1)(B) (which is essentially identical to the language in section 
209(e)(2)(A)(ii)), and reiterated its longstanding traditional 
interpretation and that the better approach for analyzing the need for 
``such State standards'' to meet ``compelling and extraordinary 
conditions'' is to review California's need for its program as a whole, 
for the class or category of vehicles being regulated, as opposed to 
its need for individual standards.\45\ We have previously and 
consistently recognized that California meets the compelling and 
extraordinary criterion when granting waivers for motor vehicles under 
section 209(b) and authorizations for California's nonroad regulations 
under section 209(e) of the Act.
---------------------------------------------------------------------------

    \43\ See Authorization Support Document at p. 15, ``In adopting 
Resolution 08-36 (Reference 5), the Board also confirmed CARB's 
longstanding position that California continues to need its own 
nonroad engine program to meet serious air pollution problems.''
    \44\ Final 209(e) Rule, 59 FR at 36982. The Administrator has 
recognized that even if such a standard by standard test were 
applied to California, it ``would not be applicable to its fullest 
stringency due to the degree of discretion given to California in 
dealing with its mobile source pollution problems.'' (41 FR 44209, 
44213, (October 7, 1976); 49 FR 18887, 18892 (May 3, 1984).)
    \45\ See EPA's 2009 GHG Waiver Decision wherein EPA rejected the 
suggested interpretation of section 209(b)(1)(B) as requiring a 
review of the specific need for California's new motor vehicle 
greenhouse gas emission standards as opposed to the traditional 
interpretation (need for the program as a whole) applied to local or 
regional air pollution problems.
---------------------------------------------------------------------------

    CARB's entire marine engine program is an important part of efforts 
to improve California's air quality through reductions of HC and 
NOX emissions. Because of California's unique and severe air 
quality problems, the state continues to need more stringent standards 
to meet its air quality goals and satisfy its State Implementation Plan 
obligations. CARB's regulation of SD/I marine engines stems from its 
determination that these sources are significant contributors to ozone-
forming emissions in California. The 2008 amendments are intended to 
enhance the program by clarifying and updating the regulations to align 
with other state and federal standards, and by increasing compliance 
flexibility. The Marine SI regulations also provide selective 
enforcement auditing, in-use compliance testing, consumer labeling to 
identify emissions performance relative to other marine SI engines, and 
a defects warranty program to protect consumers against poor quality 
products and to ensure that engines continue to perform as designed 
throughout their entire useful lives. California's Marine SI 
regulations as a whole address California's continuing struggles with 
air quality.
    We received no contrary evidence or comments contesting 
California's longstanding determination that its marine SI engine 
program is needed to address the state's compelling and extraordinary 
conditions, nor did we receive any suggestion that the program is not 
still necessary. Therefore, based on the record of this request and 
absence of comments to the contrary, EPA cannot find that California 
does not continue to need such state standards, including the 2008 
amendments, to address the ``compelling and extraordinary conditions'' 
underlying the state's air pollution problems.
4. Consistency With Section 209 of the Act
    The third and final prong of our full authorization review 
addresses consistency with section 209 of the Act, which, as discussed 
above, requires evaluation of consistency with sections 209(a), 
209(e)(1), and 209(b)(1)(C). First, to be consistent with section 
209(a), the amendments must not apply to new motor vehicles or motor 
vehicle engines. Second, to be consistent with section 209(e)(1) of the 
Act, the regulations must not attempt to regulate those vehicles and 
engines permanently preempted from state regulation by section 
209(e)(1), including farm and construction equipment and engines, 
vehicles and engines below 175 horsepower, and new locomotives or 
locomotive engines. None of the boats or engines covered by 
California's Marine SI regulations fall in those categories and we 
received no evidence to the contrary. We therefore find the 2008 
amendments are consistent with sections 209(a) and 209(e)(1).
    Third, to be consistent with section 209(b)(1)(c), there must be 
adequate lead time to permit technological development for compliance 
with the amendment, and the state test procedures must not be made 
inconsistent with federal test procedures. The 2008 amendments for 
which California has requested authorization do not require development 
of new technologies, thus there is no consistency issue presented with 
regard to lead time. Furthermore, aside from the OBD-M amendment, 
California designed the provisions for which full authorization is 
being evaluated to harmonize with federal standards. There is no 
inconsistency with federal test procedures. Indeed, one of California's 
goals in amending the marine regulations was to address any potential 
conflict with the federal regulations that may have hindered or 
unnecessarily complicated compliance, including duplicative testing.
    The misfire monitoring requirement for OBD-M may have created an 
issue with lead time since the 2008 amendments modified the conditional 
requirement into a mandatory requirement for SD/I manufacturers. 
However, as California has asserted, all manufacturers that have 
submitted reports to California already include misfire monitoring in 
their OBD-M systems. We received no comment or evidence contesting 
California's position that the misfire monitoring system, or any other 
2008 amendment, satisfies the consistency criterion under section 
209(b)(1)(c).
    We therefore find that each of the 2008 amendments that we analyzed 
under the full authorization criteria is consistent with section 209 of 
the Act.
    Having found that the 2008 amendments satisfy each of the criteria 
for full authorization, and having received no contrary evidence to 
contradict this finding, we cannot deny authorization of the 2008 
amendments.

III. Decision

    The Administrator has delegated the authority to grant California 
section 209(e) authorizations to the Assistant Administrator for Air 
and Radiation. After evaluating CARB's amendments to its Marine SI 
regulations described above, EPA is taking the following actions. 
First, EPA is granting an authorization for the following amendments: 
Revised Total Hydrocarbon Emission Standards; Enhanced Evaporative 
Emissions Controls for High Performance SD/I Engines; Modification of 
Exhaust Standards for High Performance SD/I Engines; Not to Exceed 
Limits; Revised Jet Boat Engine Standards; New Carbon Monoxide 
Emissions Standards; Revised On-Board Diagnostic Marine Requirements.
    Second, EPA confirms that the following 2008 amendments are within 
the scope of the previous EPA authorizations: Aftermarket Exemption 
Procedures Clarification; Optional Fifth Tier Added to Environmental 
Label Program; Optional Loaded Test Cycle for High Performance Engines; 
Optional Portable Measurement Systems for High Performance Engines; 
Optional Assigned Deterioration Factors for High Performance Engines; 
Optional Engine Discontinuation Allowance for SD/I Engines; Compliance 
Assistance for All Spark-Ignition Marine Engines; Replacement Engine 
Provisions.\46\
---------------------------------------------------------------------------

    \46\ We believe these amendments satisfy the criteria for a 
within-the-scope confirmation. However, we believe these eight 
amendments would also merit a full authorization if reviewed under 
that analysis.
---------------------------------------------------------------------------

    This decision will affect persons in California and those 
manufacturers and/or owners/operators nationwide who must comply with 
California's requirements. In addition, because other states may adopt 
California's standards for which a section 209(e)(2)(A) authorization 
has been granted if certain criteria are met, this decision would also 
affect those states and those

[[Page 26041]]

persons in such states. See CAA section 209(e)(2)(B). For these 
reasons, EPA determines and finds that this is a final action of 
national applicability, and also a final action of nationwide scope or 
effect for purposes of section 307(b)(1) of the Act. Pursuant to 
section 307(b)(1) of the Act, judicial review of this final action may 
be sought only in the United States Court of Appeals for the District 
of Columbia Circuit. Petitions for review must be filed by July 6, 
2015. Judicial review of this final action may not be obtained in 
subsequent enforcement proceedings, pursuant to section 307(b)(2) of 
the Act.

IV. Statutory and Executive Order Reviews

    As with past authorization and waiver decisions, this action is not 
a rule as defined by Executive Order 12866. Therefore, it is exempt 
from review by the Office of Management and Budget as required for 
rules and regulations by Executive Order 12866.
    In addition, this action is not a rule as defined in the Regulatory 
Flexibility Act, 5 U.S.C. 601(2). Therefore, EPA has not prepared a 
supporting regulatory flexibility analysis addressing the impact of 
this action on small business entities.
    Further, the Congressional Review Act, 5 U.S.C. 801, et seq., as 
added by the Small Business Regulatory Enforcement Fairness Act of 
1996, does not apply because this action is not a rule for purposes of 
5 U.S.C. 804(3).

    Dated: April 29, 2015.
Janet G. McCabe,
Acting Assistant Administrator, Office of Air and Radiation.
[FR Doc. 2015-10632 Filed 5-5-15; 8:45 am]
 BILLING CODE 6560-50-P
```