U.S. Environmental Protection Agency

Region 9

TECHNICAL SUPPORT DOCUMENT

Notice of Proposed Rulemaking

Revisions to the California State Implementation Plan

Butte County Air Quality Management District

Rule 400 – Permit Requirements

Rule 401 – Permit Exemptions

Rule 432 – Federal New Source Review (FNSR)

Prepared by Laura Yannayon

Approved by Gerardo Rios

August 5, 2016
Table of Contents 

1. Introduction...........................................................................................................................................1

2. Submittal Information...........................................................................................................................1

2.1 Submittal Agency Information......................................................................................................1

2.2 Air Quality in Butte County..........................................................................................................1

2.3 SIP Submittals...............................................................................................................................1

2.4 Current SIP Approved Rules.........................................................................................................2

2.5 Relationship Between Current SIP Rules and Submitted Revised Rules .....................................3

2.6 Completeness Determination ........................................................................................................3

3. General Requirements for SIP-Approved NSR Programs....................................................................4

3.1 Nonattainment NSR......................................................................................................................4

3.2 General NSR (aka Minor NSR) Program Requirements ..............................................................5

4. Rule Summaries....................................................................................................................................5

4.1 Rule 400 – Permit Requirements..................................................................................................5

4.2 Rule 401 – Permit Exemptions .....................................................................................................6

4.3 Rule 432 – Federal New Source Review ......................................................................................7

5. Evaluation of New Source Review Program Requirements.................................................................9

5.1 Rule Evaluation Criteria................................................................................................................9

5.2 Nonattainment NSR Requirements...............................................................................................9

5.3 General NSR Requirements........................................................................................................23

5.4 Rule 401 – Permit Exemptions ...................................................................................................26

6. New Source Review Reforms..............................................................................................................33

6.1 California Clean Air Act – New Source Review Program.............................................................33

6.2 NSR Reform Program Requirements ..........................................................................................35

6.3 Impacts of Federal NSR Reforms on California NSR Permitting Programs.................................36

7. Clean Air Act Section 110(l) Analysis................................................................................................37

8. Clean Air Act Section 193 Analysis...................................................................................................38

9. EPA’s Proposed Action ......................................................................................................................38

10. References ......................................................................................................................................39
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1. INTRODUCTION

This technical support document (TSD) focuses on the preconstruction permitting requirements 

for stationary sources, also called New Source Review or NSR, in title I of the Clean Air Act 

(CAA or the Act) and EPA’s implementing regulations addressing the State Implementation Plan 

(SIP) requirements for State NSR programs at title 40 of the Code of Federal Regulations (CFR) 

part 51, subpart I. This TSD will address the requirements for two of the three main components 

of the federal NSR program (See Section 3, General Requirements for SIP-Approved NSR 

Programs), and discuss EPA’s findings on whether the rules and regulations related to NSR that 

have been submitted by the Butte County Air Quality Management District (BCAQMD or 

District) for approval into the California SIP meet federal NSR requirements. Last, the TSD 

discusses EPA’s findings under Sections 110(l) and 193 of the Act relevant to this action.

2. SUBMITTAL INFORMATION

2.1 SUBMITTAL AGENCY INFORMATION

The Butte County Air Quality Management District (BCAQMD or District) is the air pollution 

control agency for all of Butte County, California. 

2.2 AIR QUALITY IN BUTTE COUNTY

Butte County is designated nonattainment for the 2008 8-hour ozone (marginal) and 2006 

24-hour particulate matter less than 2.5 micrometers in diameter and smaller (PM2.5) (moderate) 

NAAQS. (See 40 CFR 81.305.) Based on the District’s current nonattainment designations, their 

nonattainment NSR program is required to regulate new major sources and major modifications 

of nitrogen oxides (NOx) and volatile organic compounds (VOC) as ozone precursors under a 

moderate classification, and PM2.5 and its precursors: NOx, SO2, VOC and ammonia under a 

moderate classification. Accordingly, this TSD will evaluate whether the submitted rules meet 

NSR program requirements.

Butte County is currently designated attainment or unclassifiable for the nitrogen dioxide (NO2), 

carbon monoxide (CO), particulate matter less than 10 micrometers (PM10), sulfur dioxide (SO2), 

and lead (Pb) NAAQS. (See 40 CFR 81.305.) Therefore, the PSD permit program requirements 

apply to new major stationary sources and major modifications at existing major stationary 

sources that emit these pollutants, as well as certain other pollutants, which are also regulated 

under the CAA. On November 12, 2015, EPA approved Rule 1107 – Prevention of Significant 

Deterioration (PSD) Permits into the Butte County portion of the California SIP. (80 FR 69880) 

Accordingly, this TSD will not evaluate whether the submitted rules meet PSD program 

requirements. 

2.3 SIP SUBMITTALS

BCAQMD adopted revised permit program related rules to comply with the federal 

nonattainment NSR and minor NSR program requirements. These rules were amended on the 

dates listed below in Table 1 and submitted to EPA via the California Air Resources Board 
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(ARB) on the submittal dates indicated in the table. ARB is the governor’s designee for 

submitting official revisions of the California State Implementation Plan (SIP) to EPA. 

Table 1 – Submitted Rules

Rule # Rule Title

Adopted or 

Amended Submitted

400 Permit Requirements 5/26/11 2/6/13

401 Permit Exemptions 5/26/11 2/6/13

432 Federal New Source Review 5/26/11 2/6/13

On April 24, 2014, the BCAQMD adopted additional revisions to these submitted rules to 

address approval issues identified by EPA. These amended rules were submitted to EPA via the 

California ARB. While we can act on only the most recently submitted versions of these rules, 

we have also reviewed materials provided with previous submittals. Table 2 provides the name, 

number, adoption and submittal dates for each rule evaluated as part of this TSD.

Table 2 – Submitted Rules

Rule # Rule Title

Adopted or 

Amended Submitted

400 Permit Requirements 04/24/14 11/06/14

401 Permit Exemptions 04/24/14 11/06/14

432 Federal New Source Review 04/24/14 11/06/14

2.4 CURRENT SIP APPROVED RULES

Table 3 lists the dates of the current SIP approved rules which new submitted rules 400 and 401

will replace in the SIP. There is no previous version of Rule 432 approved in the SIP.

Table 3 – SIP Approved Rules

Rule # Rule Title

SIP Approval 

Date

Federal Register 

Citation

4-4 Exemptions from Permit Requirement 05/31/72 37 FR 10856

401 General Requirements 02/03/87 52 FR 3226

402 Authority to Construct 02/03/87 52 FR 3226

403 Permit to Operate 5/2/01 66 FR 21875

405 Permit Conditions 05/31/72 37 FR 10856

406 Emission Calculations 02/03/87 52 FR 3226

407 Anniversary Date 02/03/87 52 FR 3226

420 Standards for Granting Applications 02/03/87 52 FR 3226

421 Conditional Approval 02/03/87 52 FR 3226

424 State Implementation Plan 5/2/01 66 FR 21875
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2.5 RELATIONSHIP BETWEEN CURRENT SIP RULES AND SUBMITTED REVISED RULES

As shown in Table 4 below, newly submitted Rule 400 – Permit Requirements will replace 

several existing SIP rules. For most of these rules, the District has simply collected the very short 

existing rules and codified in them into a single rule. New Rule 401 – Permit Exemptions will 

replace existing SIP Rule 4-4 – Exemption from Permit Requirements. 

Table 4 –

Cross Reference of Current SIP Rules to be Replaced with Submitted Revised Rules

Existing SIP Rule Applicable New Rule Reference

4-4 Exemptions from Permit Requirements Rule 401—Permit Exemptions

401 General Requirements Rule 400, Sections 1, 4.1, and 4.4.1; 

Rule 432, Section 1.1

402 Authority to Construct Rule 400, Sections 4.1 and 4.1.4

403 Permit to Operate Rule 400, Section 1.1, Sections 4.2 and 4.4 

(relating to sources subject to Title V must 

comply with Rule 400)

405 Permit Conditions Rule 400, Section 5.2.4

406 Emission Calculations Rule 400, Section 4.3

407 Anniversary Date Rule 400, Section 4.6

420 Standards for Granting Applications A. Rule 400, Section 4.8

B. Rule 400, Sections 4.4.3 and 4.4.4

C. Rule 400, Sections 4.4.6

421 Conditional Approval Rule 400, Section 4.4.8 and 5.2.4

424 State Implementation Plan Rule 400, Section 4.4.3

2.6 COMPLETENESS DETERMINATION

With respect to procedures, CAA sections 110(a) and 110(l) require that revisions to a SIP be 

adopted by the State after reasonable notice and opportunity for a public hearing. EPA has 

promulgated specific procedural requirements for SIP revisions in 40 CFR part 51, Subpart F. 

These requirements include publication of notices by prominent advertisement in the relevant 

geographic area, a public hearing on the proposed revisions, a public comment period of at least 

30 days, and an opportunity for a public hearing. Based on our review of the public process 

documentation included in the November 6, 2014 submittal, we find that BCAQMD has 

provided sufficient evidence of public notice and opportunity for comment and public hearings 

prior to adoption and submittal of these rules to EPA. On December 18, 2014, EPA determined 

that ARB’s November 6, 2014 SIP submittal package conformed to the completeness criteria in 

40 CFR part 51, appendix V, and was determined to be complete.
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3. GENERAL REQUIREMENTS FOR SIP-APPROVED NSR PROGRAMS

The NSR program is a preconstruction review and permitting program established under CAA 

sections 110, 160-169, 172 and 173 that is applicable to certain new stationary sources and 

modifications at existing stationary sources. The specific regulatory requirements applicable to 

SIP-approved NSR programs are contained in 40 CFR part 51, subpart I. There are three specific 

sets of permitting requirements included in subpart I: the program commonly referred to as the 

“general” or “minor” NSR program (40 CFR 51.160-51.164), nonattainment NSR (40 CFR 

51.165), and PSD (40 CFR 51.166). On November 12, 2015, EPA approved BCAQMD Rule 

1107 – Prevention of Significant Deterioration (PSD) Permits into the California SIP (80 FR 

69880). Therefore our evaluation of the submitted rules listed in Table 2 does not include the 

provisions of 40 CFR 51.166. 

3.1 NONATTAINMENT NSR

Sections 172(c)(5) and 173 of Part D of title I of the CAA and EPA’s implementing regulations 

at 40 CFR 51.165 contain the NSR requirements for areas designated nonattainment for a 

particular NAAQS. NSR only applies to pollutants and their precursors, for which the area is 

designated as nonattainment for a NAAQS under the CAA. The primary criterion for 

applicability of the program is whether the proposed project is sufficiently large (in terms of its 

emissions) to be a major stationary source or major modification. The nonattainment NSR 

program has specific emission thresholds for determining which sources are major stationary 

sources based on the nonattainment classification of the particular pollutant. 

Generally, a major stationary source in a nonattainment area is defined as a stationary source 

with a potential to emit (PTE) of 100 tpy or more of the nonattainment pollutant. The major 

stationary source emissions threshold is lower in nonattainment areas that have been determined 

to have higher degrees of nonattainment. For example, ozone nonattainment areas are classified 

as being marginal, moderate, serious, severe, or extreme (listed in increasing order of the degree 

of nonattainment). The major source threshold for these areas varies between 100 tpy and 10 tpy. 

Under the nonattainment NSR program, a new major stationary source is subject to the NSR 

program requirements only if the source is a major source for that nonattainment pollutant. 

Modifications to existing major stationary sources (for a particular nonattainment pollutant) are 

subject to the nonattainment NSR program requirements at “significant” emission rates. The 

significance rate is lower in certain nonattainment areas with higher degrees of nonattainment, 

with the specific level based on the area’s particular nonattainment classification. 

Once a stationary source is subject to the nonattainment NSR program, the source must meet 

several criteria prior to receiving a pre-construction permit. The most significant of these 

requirements are the application of the lowest achievable emission rate (LAER) to the stationary 

source or project and the requirement to offset the emission increases from the project with 

decreases in emissions from the same or other stationary sources.

Our analysis of how BCAQMD’s NSR submittal addresses the specific requirements for a 

nonattainment NSR program is discussed in Section 5.2 of this TSD.
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3.2 GENERAL NSR (AKA MINOR NSR) PROGRAM REQUIREMENTS

Section 110(a)(2)(C) of the Act requires each SIP to include a program for the “regulation of the 

modification and construction of any stationary source within the areas covered by the plan as 

necessary to assure that national ambient air quality standards are achieved, including a permit 

program as required in parts C and D” of title I of the Act. Thus, in addition to the permit 

programs required in parts C and D of title I of the Act, which apply to new major stationary 

sources and major modifications, each SIP must include a program regulating stationary sources 

with emissions below the major source thresholds. EPA’s regulations at 40 CFR 51.160 - 51.164 

provide general programmatic requirements to implement this statutory mandate commonly 

referred to as the “general” or “minor” NSR program. These more general program requirements 

are the only federal requirements that apply to these “minor” stationary sources and non-major 

modifications. These requirements also apply to major sources and major modifications, in 

addition to the more detailed requirements in parts C and D of the Act and their implementing 

regulations at 40 CFR 51.166 and 51.165, respectively. 

Under EPA’s regulations governing the general NSR program, States and local air agencies 

retain a level of discretion to define the types and sizes of sources subject to the program, 

whereas under the PSD and nonattainment NSR permitting programs, the sources subject to 

regulation are specified by the CAA and EPA regulations. However, EPA’s regulations require 

that State general NSR programs ensure that the construction or modification of any stationary 

source would be prevented if (1) it would result in a violation of the applicable control strategy 

(i.e., SIP); or (2) it would interfere with the attainment or maintenance of a NAAQS. These 

general requirements are included in 40 CFR 51.160, 51.161, and 51.163. 

40 CFR 51.162 requires that each SIP identify the State or local agency that will be responsible 

for meeting the requirements of 40 CFR part 51, subpart I in each area of the State. And 40 CFR 

51.164 requires that SIPs establish procedures that ensure the degree of emission limitation 

required of any source for control of any air pollutant must not be affected by so much of any 

source’s stack height that exceeds good engineering practice or by any other dispersion 

technique, except as provided in 40 CFR 51.118(b). 

Our analysis of how BCAQMD’s NSR submittal addresses the specific requirements for the 

general NSR program is discussed in detail in Section 5.3 of this TSD.

4. RULE SUMMARIES

4.1 RULE 400 – PERMIT REQUIREMENTS

Rule 400 is a new rule which will replace current SIP approved Rule 401 – General 

Requirements, Rule 402 - Authority to Construct, Rule 403 – Permit to Operate, Rule 405 –

Permit Conditions, Rule 406 – Emission Calculations, Rule 407 – Anniversary Date, Rule 420 –

Standards for Granting Applications, Rule 421—Conditional Approval, and Rule 424 – State 

Implementation Plan. Each of these short permit related rules are consolidated into a single new 

Rule 400, which contains the administrative provisions for applying for and obtaining both an 

authority to construct and a permit to operate. This new rule contains several administrative 
6

provisions which also apply to the District to ensure permits are reviewed and issued in a 

consistent and timely manner. This includes requirements for public notice of a proposed permit. 

BCAQMD made several minor revisions to the existing SIP rules as they were consolidated into 

a single rule pertaining to permit requirements. Below we provide a more detailed summary of 

the rule contents described as they appear in each Section of the rule. 

Rule 400 is structured as follows:

• Section 1, Purpose – This section describes the purpose of the rule, which is to require a 

source to obtain a preconstruction permit and provide orderly procedures for application, 

review and authorization of new and modified sources. (Partial replacement for SIP Rules

401 and 403)

• Section 2, Exemptions – This section states that an Authority to Construct or Permit to 

Operate shall not be required for emissions units listed in Rule 401 – Exemptions.

• Section 3, Definitions – This section provides that the definitions in Rule 101 –

Definitions apply to Rule 400, unless the section specifically provides a definition for the 

term. 

• Section 4, Standards – This section contains the standards that apply for obtaining an 

Authority to Construct and Permit to Operate, including the information to be submitted 

and public notice requirements. This section also provides provisions for sampling and 

testing facilities, source performance testing, air quality impact analysis and 

indemnification. (Partial replacement for SIP Rules 401, 402, 403, 406, 407, 420, 421 and 

424.)

• Section 5, Administrative Requirements – This section contains the administrative 

provisions needed for the review and issuance of Authorities to Construct and Permits to 

Operate, which include requirements for application submittals and criteria for action on 

applications. It also contains other permit related provisions including the requirements 

regarding posting of the permit, prohibitions regarding altering the permit, and conditions 

under which the APCO may suspend, cancel or revoke a Permit to Operate. Finally this 

section provides the administrative procedures for appealing a permit action. (Partial 

replacement for SIP Rules 405 and 421.)

• Section 6, Monitoring and Records – This section contains provisions pertaining to 

testing procedures, and monitoring and recordkeeping requirements. 

4.2 RULE 401 – PERMIT EXEMPTIONS

Whereas Rule 400 – Permit Requirements sets out the provisions for what type of emission units 

must obtain an Authority to Construct and Permit to Operate, Rule 401 lists the specific types 

and sizes of emission units which may be constructed and operated without first obtaining a

permit from the District. Rule 401 is a replacement for existing SIP approved Rule 4-4 –

Exemptions from Permit Requirements. Rule 4-4 was approved in the Butte County portion of 
7

the California SIP on May 31, 1972, as part of the original California SIP submittal. While Butte 

County has submitted various revisions to this rule over the years, EPA has never approved a 

new version of the rule into the SIP. The current SIP version of Rule 4-4 contains 15 specific 

permit exemptions, whereas Rule 401 contains 18 categories and 39 specific exemptions. Below 

we provide a more detailed summary of the rule contents described as they appear in each 

Section of the rule. 

Rule 401 is structured as follows:

• Section 1, Purpose – This section describes the purpose of the rule, which is to specify 

the emissions units that are categorically or conditionally exempted from the 

requirements of Rule 400 – Permit Requirements. 

• Section 2, Applicability – This section contains several provisions which clarify the 

applicability or non-applicability of Rule 401 to certain emission units. 

• Section 3, Requirements – This section specifies the type of information that the APCO 

may require from any person claiming an exemption pursuant to Rule 401. It also 

provides that if an application is required for an APCO determination, the source must 

submit an application and the APCO must provide a written determination. 

• Section 4, Exempt Source Categories – This section lists all of the types of emission units 

which are exempted from the requirement to obtain an Authority to Construct and/or a 

Permit to Operate. The emission units are grouped by source categories. 

• Section 5, Conditionally Exempt Sources – This section provides that certain sources 

may be exempted from the requirements to obtain an Authority to Construct and Permit 

to Operate if certain conditions are met, including written approval from the APCO. This 

section specifically applies to identical replacement of equipment and very low emitting 

sources (less than 500 lb/yr). The requirements for obtaining APCO written concurrence 

are also provided in this section.

• Section 6, Recordkeeping – This section specifies the types of records which must be 

maintained to demonstrate applicability of certain exemption provisions.

• Section 7, Compliance Schedule – This section provides time lines for sources that lose 

their permit exemption to submit an application pursuant to the requirements of Rule 400.

Compared to the Rule 4-4 – Exemptions from Permit Requirements, Rule 401 contains 

significant new administrative provisions and several new types of exempt sources. The District 

reorganized and clarified certain other provisions, added some new provisions and deleted some 

other provisions. 

4.3 RULE 432 – FEDERAL NEW SOURCE REVIEW
8

Rule 432 is a new rule intended to satisfy the requirements of CAA Part D of title I, which 

applies to new and modified major sources located in areas classified nonattainment for one or 

more NAAQS. There is currently no SIP approved nonattainment NSR program for Butte 

County. Below we provide a more detailed summary of the rule contents described as they 

appear in each Section of the rule. 

Rule 432 is structured as follows:

• Section 1, Purpose – This section describes the purpose of the rule, which is to specify 

the preconstruction review requirements for new and modified stationary sources 

emitting pollutants for which the area is designated nonattainment. This section also 

provides a summary of the rule requirements, including evaluation of all applicable 

requirements, the use of BACT (the State equivalent to LAER), providing offsets and an 

analysis of air quality impacts. 

• Section 2, Applicability – This section provides that the rule is applicable to all new and 

modified stationary sources which are subject to Rule 400 – Permit Requirements. It also 

clarifies that regulations in effect at the time an application is deemed complete shall 

apply, unless a new federal requirement which has not been incorporated into the rule 

would apply. Finally this section provides that the provisions of Section 5.1 and 5.2 do 

not apply to portable, temporary or replacement emissions units, unless the unit is a major 

source or will operate at a major source. 

• Section 3, Effective Date – This section specifies the rule became effective on the date of 

rule adoption – April 24, 2014.

• Section 4, Definitions – This section provides that the definitions contained in Rule 101 –

Definitions are applicable, unless a specific definition for a term is provided in this 

section. The definitions provided in this section are mainly those which specifically apply

to a permit program.

• Section 5, Requirements – This section contains the specific requirements that apply to 

each emissions unit, including BACT and offset requirements. The section includes 

specific provisions regarding the location of offsets and required offset ratios, as well as a 

provision for when interpollutant offsets may be allowed. 

• Section 6, Emission and Offset Calculations – This section specifies the methods to be 

used to calculate emissions from a project, including emission increases and decreases, as 

well as the treatment of fugitive emissions.

• Section 7, Administrative Requirements – This section provides several specific 

administrative requirements which apply to new and modified major sources, such as

providing an alternative siting analysis, a certification of statewide compliance, an 

analysis of potential visibility impacts and air quality impacts. 
9

• Section 8, Power Plants – This section contains additional requirements applicable to the 

permitting of power plants. Under state law, any authority to construct permit may only 

be issued after a project has meet all applicable requirements of the California Energy 

Commission. These requirements are in addition to the federal permit requirements 

contained elsewhere in the rule.

5. EVALUATION OF NEW SOURCE REVIEW PROGRAM REQUIREMENTS

5.1 RULE EVALUATION CRITERIA

For this TSD, EPA reviewed Rules 400, 401 and 432 to ensure they meet the applicable 

requirements of section 110 and part D of title I of the Act, and current implementing regulations 

at 40 CFR 51.160 through 51.165, as well as CAA section 302(z) and 40 CFR 51.307, which 

both contain additional provisions for permit programs. 

EPA also relied on the following materials in our review: 

• General Preamble for the Implementation of Title I of the Clean Air Act Amendments of 

1990 (see 57 FR 13498, April 16, 1992), 

• EPA’s Emission Offset Interpretive Ruling (40 CFR part 51, appendix S), 

• EPA’s policy document entitled, “Improving Air Quality with Economic Incentive 

Programs” that was published in January 2001, and

• Other materials listed in the docket for this proposed action.

EPA has condensed the approval criteria contained in these various materials for use in this TSD, 

which describes the reasons for our proposed action on the SIP submittal for Rules 400, 401 and 

432 for the BCAQMD.

5.2 NONATTAINMENT NSR REQUIREMENTS

The Act requires all States with nonattainment areas to submit a nonattainment NSR permit 

program consistent with the NSR provisions discussed below. We are applying the requirements 

in section 173 of the CAA and 40 CFR 51.165 to evaluate whether BCAQMD’s SIP submittal of 

Rules 401 and 432, along with other SIP approved rules, satisfy these requirements.

5.2.1 Requirement: Pursuant to section 173(a)(1)(A) of the CAA, the SIP must contain 

provisions to assure that the calculation of emissions offsets is based on the same 

emissions baseline used in the demonstration of reasonable further progress.

Discussion: First we note that the emissions inventories prepared by the District for the 

two nonattainment pollutants (ozone and PM2.5) are based on actual emissions. For new 

or modified major sources emitting a nonattainment pollutant Rule 432 Section 5.2.4 

requires offsets to be provided when emission increases exceed specified thresholds. 

Section 4.11 defines the term Emission Reduction Credits (ERCs) such that all ERCs 

must be based on “actual” emission reductions. Thus, the basis for the demonstration of 

RFP and the calculation of NSR emissions offsets is the same (i.e., actual emissions).
10

Second, regarding the amount of offsets that are necessary to show noninterference with 

RFP, EPA believes that so long as a new source obtains offsets in an amount equal to or 

greater than the amount specified in the applicable offset ratio (or, where the statute does 

not specify an offset ratio, in an amount equal or greater than 1:1), the new source will 

not interfere with RFP. Rule 432 Section 5.3 provides the ratios for federal offset

purposes, which are all equal to or greater than 1:1 for nonattainment pollutants. These 

offset ratio requirements ensure that the program for permitting of new or modified major 

sources will not interfere with RFP. These provisions satisfy the statutory requirement.

5.2.2 Requirement: Pursuant to section 173(a)(2) of the CAA, the SIP must require LAER for 

a new major stationary source or major modification at an existing major stationary 

source. 

Discussion: The term “Lowest Achievable Emission Rate (LAER)” is defined in Section 

4.19 as “The same as BACT is defined in this Rule.” The term “Best Available Control 

Technology (BACT)” is defined in Section 4.7 as the most stringent emissions limitation 

or control technique of a list of options. The provisions listed in Subsection 4.7.1 and 

4.7.2 are the same as EPA’s definition of LAER. If no controls are available that meet 

these first two criteria, then the definition provides additional provisions which require

the application of BACT as defined in EPA’s PSD regulations. Therefore we find that the 

Rule 432 provides an equivalent definition to the term “LAER” as found in 40 CFR 

51.165(xiii). 

Section 5.1 requires the application of BACT to any new or modified emission unit 

which results in a net emission increase of at least 100 tpy for new sources, and a 

significant net emission increase for modifications. These thresholds match the regulatory 

thresholds for the District’s nonattainment status for ozone and PM2.5. This provision 

satisfies the statutory requirement.

5.2.3 Requirement: Pursuant to section 173(a)(3) of the CAA, the SIP must contain provisions 

to assure that owners or operators of each proposed new or modified major stationary 

source demonstrate that all other major stationary sources under the same ownership in 

the State are in compliance with the Act.

Discussion: Rule 432 Section 7.2 requires an applicant for any new major stationary 

source or any major modification regulated by the rule to provide a certification stating 

that all existing major stationary sources owned or operated by such person (or by any 

entity controlling, controlled by, or under common control with such person) in 

California which are subject to emission limitations are in compliance, or on an 

expeditious schedule for compliance, with all applicable emission limitations and 

standards. This provision satisfies the statutory requirement.

5.2.4 Requirement: Pursuant to section 173(a)(5) of the CAA, as a prerequisite to issuing any 

permit in accordance with part D of the CAA, the SIP must contain provisions that 

require an analysis of alternative sites, sizes, production processes, and environmental 

control techniques for proposed sources that demonstrates that the benefits of the 
11

proposed source significantly outweigh the environmental and social costs imposed as a 

result of its location, construction, or modification. 

Discussion: Rule 432 Section 7.1 requires an applicant for any new major stationary 

source or any major modification regulated by the rule to provide an analysis which is 

functionally equivalent to the requirements of Division 13 of the Public Resources Code. 

This state law provision requires an analysis of alternative sites, sizes, production 

processes, and environmental control techniques for such proposed source that 

demonstrates the benefits of the proposed source significantly outweigh the 

environmental and social costs imposed as a result of its location, construction or 

modification. This provision satisfies the statutory requirement.

5.2.5 Requirement: Pursuant to section 173(c)(1) of the CAA, the SIP must contain provisions 

to assure that any emissions offsets required in conjunction with the issuance of a permit 

to a new or modified stationary source must be enforceable by the time of issuance of the 

permit, and in effect by the time the new or modified stationary source commences 

operation.

Discussion: Rule 432 Section 5.2.2 contains the general provision that all offsets must be 

enforceable. Section 5.2.6 requires offsets to be identified at the time of application and 

must be surrendered prior to the operation of the permitted emission unit. These

provisions ensure that emissions offsets required in conjunction with the issuance of an

ATC for a new or modified stationary source will be enforceable by the time the ATC is 

issued.

5.2.6 Requirement: Pursuant to section 173(c)(1) of the CAA, the SIP must contain provisions 

to assure that emissions increases from new or modified major stationary sources are 

offset by real reductions in actual emissions.

Discussion: Rule 432 Section 4.2 defines Actual Emission Reductions as “A reduction in 

actual emissions from an emissions unit. Actual emissions reductions shall be real, 

enforceable, quantifiable, surplus, and permanent.” In addition, under Section 5.2 which 

specifies Offset Requirements, Subsection 5.2.2 requires that “Offsets shall be real, 

permanent, enforceable, surplus at time of use, and quantifiable.” Taken together these 

provisions satisfy this requirement.

5.2.7 Requirement: Pursuant to section 173(c)(2) of the CAA, the SIP must contain provisions 

to prevent emissions reductions otherwise required by the Act from being credited for 

purposes of satisfying the part D offset requirements.

Discussion: Rule 432 Section 4.45 defines Surplus as “The amount of actual emission 

reductions that are not otherwise required by federal, State, or local law, not required by 

any legal settlement or consent decree, and not relied upon to meet any requirement 

related to the California SIP at the time of use. However, emission reductions required by 

a State statute that provides that the subject emission reductions shall be considered 

surplus may be considered surplus for purposes of this Rule if those reductions meet all 
12

other applicable requirements.” In addition, under Section 5.2 which specifies Offset 

Requirements, Subsection 5.2.2 requires that “Offsets shall be real, permanent, 

enforceable, surplus at time of use, and quantifiable.” Taken together these provisions 

satisfy this requirement.

5.2.8 Requirement: Pursuant to section 302(z) of the CAA, the SIP must provide that control 

of a “stationary source” does not include emissions resulting directly from an internal 

combustion engine for transportation purposes or from a nonroad engine or nonroad 

vehicle. 

Discussion: Rule 432 Section 4.44 defines the term Stationary Source. Subsection 4.44.3 

states that the definition of Stationary Source excludes non-road engines as defined in 

CAA Section 216. This provision satisfies the statutory requirement.

5.2.9 Requirement: The District’s NSR program must contain the specific definitions found in 

40 CFR 51.165(a)(1). 

Discussion: In most cases, the definitions contained in BCAQMD’s Rule 100 –

Definitions and Rule 432 – Federal New Source Review are equivalent to language used 

in 40 CFR 51.165(a)(1). Deviations from the wording provided in 40 CFR 51.165(a)(1) 

may be approved if the submitted definition is more stringent, or at least as stringent, in 

all respects. We evaluate below the definitions which do not match the federal definitions 

as closely to determine if they are acceptable substitutions. EPA’s evaluation of these 

definitions is provided below. 

Actual Emissions

The definition of this term found in Rule 432 Section 4.1 contains the same basic 

definition of the term, but does not specify the calculation methodologies provided in the 

definition of this term is 40 CFR 51.165 (a)(xii). However, in Section 4.16, the definition 

for the term Historic Actual Emissions does provide the same timeframes for determining 

actual emission rates. EPA finds these two definitions acceptable to satisfy the 

requirement to define this term.

Construction; Commence; Necessary Preconstruction Approvals; Begin Actual 

Construction

The District’s NSR rule does not provide definitions for these specific terms found in 

51.165(a)(1)(xvi)-(xviii). To the extent the purpose of these terms is to ensure actual 

construction is not begun prior to obtaining necessary preconstruction approvals, EPA 

has determined that the language in Rule 400 Section 4.1 serves the same purpose, in that 

it prohibits equivalent pre-construction activities. EPA finds this alternative provision 

acceptable.1

 1 See EPA’s TSD dated October 29, 1996 for South Coast AQMD NSR rules (page 8). 
13

Emissions Unit

While Rule 432 Section 4.13 provides an adequate definition for this term generally, the 

definition does not include any provisions to differentiate between a “new” or “existing” 

emission unit, as provided in 40 CFR 51.165(a)(1)(vii). EPA added a definition for this 

term to our regulations as part of the 2002 NSR Reforms in order to allow different 

treatment of new or existing emission units for the purposes of determining NSR program 

applicability. As discussed in Section 6 of this TSD, EPA has determined that it is 

acceptable for BCAQMD to not include provisions related to NSR Reform as a part of 

their NSR program, therefore we find it is acceptable for the definition of emission unit 

provided in Rule 432 to not differentiate between new and existing emission units. 

Federally Enforceable

Rule 432 Section 4.14 uses the term “Enforceable” to provide the same definition as 

found in 51.165 (a)(1)(xiv), and specifies that this definition applies for the purposes of 

federal requirements. This is acceptable. 

Lowest Achievable Emission Rate (LAER)

BCAQMD’s rules do not define this term found in 40 CFR 51.165(a)(1)(xiii). Instead the 

rule provides a definition in Section 4.7 for the term “Best Available Control Technology 

(BACT),” which incorporates the definition of LAER by specifying that BACT is the 

most stringent of (1) applied in practice technology (analogous to LAER standard) or (2) 

the technology that is technically feasible and cost-effective (analogous to PSD BACT 

standard). EPA finds this acceptable. 

Major Modification

Rule 432 Section 4.20 provides a definition for this term which includes the key 

elements, such as requiring the modification to occur at a major source and to have a 

significant net emissions increase. The definition incorporates the “significant” emission 

rates directly into the definition rather than referencing the term “significant.” The rule 

also provides a definition for the term “modification” in Section 4.22 which provides the 

additional elements from the federal definition of major modification pertaining to what 

type of changes are not considered to be modifications. Taken together these provisions 

satisfy the requirement to define the term “major modification.”

Net Emissions Increase, Emission Unit, Significant, Electric Utility Steam Generating 

Unit, Allowable Emissions, Significant Emissions Increase, Projected Actual Emissions, 

Baseline Actual Emissions, and Regulated NSR Pollutant

BCAQMD’s rules do not provide specific definitions for these NSR Reform related terms 

found in 40 CFR 51.165(a)(1)(v), (vi), (vii), (x), (xx), (xxvii), (xxviii), (xxxv), and 

(xxxvii). These terms are all used to determine whether a change at a major stationary 

source will result in a major modification. As discussed in Section 6 of this TSD, EPA 

has determined that it is acceptable for BCAQMD to not include provisions related to 

NSR Reform as a part of their NSR program, therefore we find it is acceptable that Rule 

432 does not provide definitions for these terms. 
14

Project

40 CFR 51.165(a)(1)(xxxix) defines this term as “Project means a physical change in, or 

change in the method of operation of, an existing major stationary source.”, whereas Rule 

432 defines this term as “All emissions units associated with the scope of an application 

submitted in accordance with Rule 400 for a new or modified stationary source including 

any emissions units indirectly affected.” While Rule 432 does not provide a definition 

similar to the federal definition for this term, it does provide the same definition within 

the definition of the term “Modification” in Section 4.22. Therefore, we find the 

definition provided in the term “modification” adequate for the purposes of determining 

the applicable requirements of Rule 432. 

Reviewing Authority

BCAQMD’s rules use the terms “Air Pollution Control Officer” and “District” in place of 

the term reviewing authority in 40 CFR 51.165(a)(1)(xxxviii). These terms are defined in 

Sections 4.8 and 4.29 of Rule 101- Definitions, which is SIP approved.2 This is 

acceptable.

Secondary Emissions

BCAQMD’s rules do not provide a definition for this term found in 40 CFR 

51.165(a)(1)(viii). EPA’s implementing NSR regulations only use this term is within the 

definition of PTE, which states that secondary emissions are to be excluded when 

calculating PTE. The District’s definition of PTE in Section 4.32 does not exclude 

secondary emissions when determining the PTE of a stationary source or emission unit. 

Since not excluding secondary emissions from PTE calculations makes the District’s 

definition at least as stringent as the federal definition of PTE, we find it is acceptable for 

the BCAQMD’s rules to not include a definition for the term Secondary Emissions. 

Significant

BCAQMD’s rules do not provide a specific definition for this term. Instead it 

incorporates the thresholds provided in this definition in the definition of “Major 

Modification” in Section 4.20. EPA finds the definition provided in Section 4.20 is 

acceptable to satisfy the requirement to provide a definition for the term “significant” as 

defined in 40 CFR 51.165 (a)(x). 

Volatile Organic Compounds (VOC)

Rule 101 – Definitions, which is SIP approved, provides a definition for the term 

“Volatile Organic Compound” in Section 4.107, which is substantially equivalent to the 

federal definition of VOC in 40 CFR 51.165(a)(1)(xix). We find this substitution 

acceptable.

Rule 432 includes two additional terms which are not contained in 40 CFR 51.100 or 

51.165 and have not yet been considered in this TSD. The first term is Basic Design 

Parameters found in Section 4.5. The definition for this terms is consistent with the 

definition of the term EPA promulgated as part of our Routine Maintenance, Repair and 

Replacement (RMRR) rulemaking. 68 FR 61248 (October 27, 2003). While the RMRR

 

2 80 FR 33195, June 11, 2015
15

rulemaking was vacated in its entirety by the DC Circuit Court,3 the definition for this is 

still acceptable and is appropriate to be included because the term Replacement Unit, 

which is included in 40 CFR 51.165(a)(xxi) includes the term Basic Design Parameters. 

The second term is Best Available Control Measures (BACM) found in Section 4.6. This 

term is used in the definition of “Surplus” found in Section 4.45, as an example of the 

types of SIP-related requirements for which emission reduction credit cannot be granted 

for the purposes of providing offsets required by the rule. EPA finds this definition 

acceptable. 

5.2.10 Requirement: Pursuant to 40 CFR 51.165(a)(1)(iv)(C), the SIP must contain provisions 

that require fugitive emissions to be included in the major stationary source applicability 

determination if the source belongs to one of the source categories listed in that section.

Discussion: In Rule 432 Section 4.21 the definition of the term “Major Stationary 

Source” specifies that “The fugitive emissions associated with an emissions unit or a 

stationary source shall not be included in determining whether the source is a major 

stationary source unless the source is a category source or sources included in 40 CFR 

51.165(a)(1)(iv)(C).” In addition, under Section 6, which specifies how emissions and 

offset calculations are to be performed, Section 6.4 provides the following procedure: 

“The fugitive emissions associated with an emissions unit or a stationary source shall not 

be included in determining whether a stationary source is a major stationary source or 

major modification to a stationary source unless the source belongs to one of the 

categories of sources included in 40 CFR 51.165(a)(1)(iv)(C).” These provisions satisfy 

the regulatory requirement.

5.2.11 Requirement: Pursuant to 40 CFR 51.165(a)(2), (a)(6), and (a)(7), the SIP must contain 

specific applicability procedures for determining whether a proposed change to an 

existing major stationary source is a major modification and maintain specific records 

depending on the specific calculation method chosen.

Discussion: The applicability procedures contained in paragraphs (a)(2)(ii)(A) through 

(F) are often referred to as “NSR Reform” applicability provisions because they were 

promulgated as part of EPA’s December 31, 2002 rulemaking entitled NSR Reform. In 

that rulemaking EPA provided new additional methods for determining if a project would 

result in a major modification. Paragraph (a)(2)(ii) states that “Deviations from these 

provisions will be approved only if the State specifically demonstrates that the submitted 

provision are more stringent than or at least as stringent in all respects as the 

corresponding provisions in paragraphs (a)(2)(ii)(A) through (F) of this section.” 

California has provided a demonstration showing that because of more stringent state law 

permit requirements, projects in California are not able to utilize the additional 

flexibilities provided by the NSR Reform provisions. Please see Section 6 of the TSD for 

additional information on EPA’s review of this demonstration. Based on this review, 

EPA is proposing to find that it is acceptable for BCAQMD to not incorporate the NSR 

Reform provisions into their SIP approved NSR program, since the same level of control 

 

3 New York, et al v. EPA, Case No. 03-1380, 2006 WL 662746 (D.C. Cir. March 17, 2006)
16

will be required for modified sources, with or without inclusion of these provisions in the 

SIP, and their programs will not be any less stringent than the federal program. 

5.2.12 Requirement: 40 CFR 51.165(a)(3)(i) requires that the baseline for determining credit 

for emissions reductions be the emissions limit under the applicable SIP in effect at the 

time the application to construct is filed, except that the offset baseline must be the actual 

emissions of the stationary source from which offset credit is obtained where (1) the 

demonstration of reasonable further progress and attainment of ambient air quality 

standards is based upon the actual emissions of sources located within a designated 

nonattainment area for which the preconstruction review program was adopted; or (2) the 

applicable SIP does not contain an emissions limitation for that source or source 

category.

Discussion: This provision allows emission reduction credit based on reductions below 

applicable SIP required emission limits except when an area’s attainment plan uses an 

actual emission inventory as the basis for planning requirements. BCAQMD used actual 

emissions from its sources in the emissions inventories it has submitted for planning 

purposes.4 Therefore the requirement to use actual emissions as the baseline for 

determining credit for emission reductions is applicable, pursuant to 40 CFR 

51.165(a)(3)(i). 

Rule 432 Section 4.11 defines an Emission Reduction Credit (ERC) as “reductions of 

actual emissions...”. Therefore all reductions that are eligible for credit as an ERC are 

based on actual emission reductions in accordance with this requirement. This provision

satisfies the requirements of 40 CFR 51.165(a)(3)(i). 

5.2.13 Requirement: Pursuant to 40 CFR 51.165(a)(3)(ii)(C)(1), the SIP must provide that 

emissions reductions achieved by shutting down an existing emission unit or curtailing 

production or operating hours may be generally credited for offsets if they meet the 

following requirements: (i) such reductions are surplus, permanent, quantifiable, and 

federally enforceable; and (ii) the shutdown or curtailment occurred after the last day of 

the base year for the SIP planning process (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; 

however, in no event may credit be given for shutdowns that occurred before August 7, 

1977).

Discussion: Rule 432 Subsection 5.2.2 requires that “Offsets shall be real, permanent, 

enforceable, surplus at time of use and quantifiable,” which satisfies the first requirement 

specified in 40 CFR 51.165(a)(3)(ii)(C)(1)(i).

EPA determined that Butte County attained the 1997 8-hour ozone NAAQS in 2012, the 

2008 8-hr ozone NAAQS in 2016 and the 24-hour PM2.5 NAAQS in 2013.5 Accordingly, 

 

4 May 23, 2014 Emission Inventory for the State of California, submitted by ARB on July 17, 2014. 

5 77 FR 71551, December 3, 2012; 81 FR 26697, May 4, 2016; and 78 FR 55225, September 10, 2013.
17

the District is not currently required to submit an attainment demonstration for these 

standards. Since the BCAQMD is classified as a marginal ozone attainment area for the 

2008 8-hour ozone NAAQS, it was not required to submit an attainment demonstration 

for the 8-hour ozone NAAQS. Because the District is not required to submit an 

attainment demonstration for any of these pollutants, there is no “projected emission 

inventory” in which to explicitly include the emissions from previously shutdown or 

curtailed emission units. Therefore, EPA finds that emission reductions from any 

shutdown or curtailment occurring after August 7, 1977 may be used as offsets as long as 

such reductions are real, surplus, permanent, quantifiable, and federally enforceable.

5.2.14 Requirement: Pursuant to 40 CFR 51.165(a)(3)(ii)(C)(2), the SIP must provide that 

emissions reductions achieved by shutting down an existing emissions unit or curtailing 

production or operating hours and that do not meet the requirements in 40 CFR 

51.165(a)(3)(ii)(C)(1)(ii) may be generally credited only if (1) the shutdown or 

curtailment occurred on or after the date the construction permit application is filed; or 

(2) the applicant can establish that the proposed new emissions unit is a replacement for 

the shutdown or curtailed emissions unit, and the emissions reductions achieved by the 

shutdown or curtailment met the requirements of 40 CFR 51.165(a)(3)(ii)(C)(1)(i).

(Emphasis added)

Discussion: This requirement only applies if the source does not meet the requirements 

in 40 CFR 51.165(a)(3)(ii)(C)(1)(ii). Because the District has complied with these 

requirements, the provisions of 40 CFR 51.165(a)(3)(ii)(C)(2) are not applicable at this 

time. 

5.2.15 Requirement: Pursuant to 40 CFR 51.165(a)(3)(ii)(D), the SIP must that provide that no 

emissions credit may be allowed for replacing one hydrocarbon compound with another 

of lesser reactivity, except for those compounds listed in Table 1 of EPA’s 

“Recommended Policy on Control of Volatile Organic Compounds” (42 FR 35314, July 

8, 1977).

Discussion: The District’s rules do not distinguish between the reactivity of organic 

compounds and the District’s rules do not allow emissions credit for replacing one 

hydrocarbon compound with another of lesser reactivity. The lack of any provisions to 

allow credit for replacing one hydrocarbon compound with another of lesser reactivity is 

sufficient to satisfy this regulatory requirement.

5.2.16 Requirement: Pursuant to 40 CFR 51.165(a)(3)(ii)(E), the SIP must provide that all 

emission reductions claimed as offset credit shall be federally enforceable.

Discussion: Rule 432 Subsection 5.2.2 requires that “Offsets shall be real, permanent, 

enforceable, surplus at time of use and quantifiable.” Because the rule defines 

enforceable in a manner to include federal enforceability, this provision satisfies this 

regulatory requirement.
18

5.2.17 Requirement: Pursuant to 40 CFR 51.165(a)(3)(ii)(F), the SIP must provide procedures 

relating to the permissible location of offsetting emissions which are at least as stringent 

as those set out in 40 CFR part 51, appendix S, section IV.D. Appendix S states that a 

new or modified major stationary source may comply with the offset requirements for 

emission increases by obtaining emissions reductions from the same source or other 

sources in the same nonattainment area, except that the reviewing authority may allow

emissions reductions in another nonattainment area if (i) the other area has an equal or 

higher nonattainment classification than the area in which the source is located, and (2) 

emissions from such other area contribute to a violation of the national ambient air 

quality standard in the nonattainment area in which the source is located. (Emphasis 

added)

Discussion: Subsection 5.3.1 provides that “...offsets can only be provided from a 

nonattainment area, with the same or higher nonattainment classification, for the same 

pollutant or precursor of that pollutant. This satisfies the requirements of 40 CFR part 51, 

appendix S, section IV.D.1. Subsection 5.3.1 provides that the “Use of offsite offsets 

must result in a net air quality benefit, as determined by the APCO.” While the rule 

language does not specify that the area the offsets are being obtained from must 

contribute to a violation of a NAAQS in the nonattainment area the source is to be 

permitted in, it does provide that the emission reduction must result in a net air quality 

benefit, which can only occur from a different air basin if that air basin in contributing to 

the local areas non-attainment. Therefore, while EPA believes the District’s rule could be 

improved by clarifying this provision, we find the current language sufficient to satisfy 

the intent of the regulatory requirement found in 40 CFR 51.165(a)(3)(ii)(F).

5.2.18 Requirement: Pursuant to 40 CFR 51.165(a)(3)(ii)(G), the SIP must provide that credit 

for an emissions reduction can only be claimed to the extent that the reviewing authority 

has not relied on it in issuing any permit under regulations approved pursuant to 40 CFR 

part 51, subpart I, or the State has not relied on it in an attainment demonstration or 

reasonable further progress.

Discussion: Rule 432 Subsection 5.2.2 requires that “Offsets shall be real, permanent, 

enforceable, surplus at time of use and quantifiable.” Section 4.45 provides a definition 

for the term “surplus” which ensures the requirements of this provision is met. 

5.2.19 Requirement: Pursuant to 40 CFR 51.165(a)(3)(ii)(J), the District’s nonattainment NSR 

rule must require the total tonnage of increased emissions resulting from a major 

modification to be offset in accordance with section 173 of the CAA and that the quantity 

of offsets shall be the difference between the allowable emissions (i.e. PTE) after the 

modification and the actual emissions before the modification for each emissions unit.

Discussion: Rule 432 Section 6.2 provides the provisions for determining emission 

increases or decreases for the purposes of offsets. Specifically it provides that the 

emission increase or decrease for each emission unit shall be calculated as the Proposed 

Emissions minus the Historical Actual Emissions. While this provision uses different 

terms to describe the pre- and post-project emissions, the terms as defined ensure the 
19

required calculation is consistent with the requirements of 40 CFR 51.165(a)(3)(ii)(J). 

Therefore we find that this regulatory requirement is satisfied. 

5.2.20 Requirement: Pursuant to 40 CFR 51.165(a)(5), the SIP must include enforceable 

procedures to provide that (1) approval to construct shall not relieve any owner or 

operator of the responsibility to comply fully with the SIP and any other requirements 

under local, State or Federal law; and (2) at such time that a particular stationary source 

or modification becomes a major stationary source or major modification solely by virtue 

of a relaxation in any enforcement limitation which was established after August 7, 1980, 

on the capacity of the stationary source or modification otherwise to emit a pollutant, 

such as a restriction on hours of operation, then the requirements of regulations approved 

pursuant to 40 CFR 51.165 shall apply to the stationary source or modification as though 

construction had not yet commenced on the source or modification. 

Discussion: Rule 400 Section 4.4.6 states that the “Issuance of an Authority to Construct 

shall not relieve any owner or operator of the responsibility to comply fully with all 

applicable requirements.” This language satisfies the first provision. Rule 432 Section 7.5 

states “If any source or modification becomes a major stationary source or major 

modification as defined in Section 4 of this Rule solely by virtue of a relaxation in any 

federally enforceable limitation which was established after August 7, 1980, on a 

capacity of the source or modification to emit a federal nonattainment pollutant or its 

precursor, such as a restriction on hours of operation, then the requirements of this Rule 

shall apply to such a source or modification as though construction had not yet 

commenced on the source or modification.” This language satisfies the second provision.

These two provisions taken together satisfy these regulatory requirements.

5.2.21 Requirement: Pursuant to 40 CFR 51.165(a)(8), the SIP must provide that the 

requirements of 40 CFR 51.165 applicable to major stationary sources and major 

modifications of volatile organic compounds shall apply to nitrogen oxides emissions 

from major stationary sources and major modifications of nitrogen oxides in any ozone 

nonattainment area.

Discussion: The substantive nonattainment NSR provisions in Rule 432 apply to both 

NOx and VOC. These provisions include the BACT (equivalent to federal LAER) and 

offset requirements in Subsections 5.1 and 5.2, respectively. These provisions satisfy this

regulatory requirement.

5.2.22 Requirement: Pursuant to 40 CFR 51.165(a)(9)(i), the SIP must provide that in meeting 

the emissions offset requirements of 40 CFR 51.165(a)(3), the ratio of total actual 

emissions reductions to the emissions increase shall be at least 1:1 unless an alternative 

ratio is provided for the applicable nonattainment area in 40 CFR 51.165(a)(9)(ii)-(iv).

Discussion: Butte County is designated nonattainment for the 2008 8-hour ozone 

(marginal), and 2006 24-hour PM2.5 (moderate) NAAQS. Based on the District’s current 

nonattainment designations, their nonattainment NSR program requires offset ratios of 

1.1:1 for ozone (marginal) and 1:1 for PM2.5 (moderate), including applicable precursors. 
20

Section 5.3 of Rule 432 provides the District’s offset ratio requirements for all

nonattainment pollutants. Subsection 5.3.3.2 requires offsets at a ratio of 1.2 to 1, if the 

offsets come from a source located within 20 miles of the project. If the offsets are 

obtained from a source farther than 20 miles away, the required offset ratio increases. 

These offset ratios are satisfactory to comply with the requirements of this regulatory 

requirement. 

5.2.23 Requirement: Pursuant to 40 CFR 51.165(a)(10), the SIP must provide that the 

requirements of 40 CFR 51.165 applicable to major stationary sources and major 

modifications of PM10 shall also apply to major stationary sources and major 

modifications of PM10 precursors, except where the Administrator determines that such 

sources do not contribute significantly to PM10 levels that exceed the PM10 ambient 

standards in the area.

Discussion: Butte County is designated as unclassified/attainment for PM10. (See 40 CFR 

81.305.) Therefore PM10 is treated as an attainment pollutant subject to PSD regulations, 

rather than the nonattainment program requirements of 40 CFR 51.165. Therefore, 40 

CFR 51.165 (a)(10) is not applicable to PM10 emissions in Butte County.

5.2.24 Requirement: The requirement found in 40 CFR 51.165(a)(10) that nonattainment NSR 

plan requirements shall also apply to major stationary sources and major modifications of 

PM10 precursors is derived from CAA section 189(e). Section 189(e) is found in subpart 

4 of Part D of Title I of the CAA, which outlines provisions applicable to particulate 

matter nonattainment areas. Section 189(e) requires the control of major stationary 

sources of PM10 precursors “except where the Administrator determines that such sources 

do not contribute significantly to PM10 levels which exceed the standard in the area.” In 

Natural Resources Defense Council (NRDC) v. EPA, 706 F.3d 428 (D.C. Cir. 2013), the 

United States Court of Appeals for the District of Columbia Circuit (D.C. Circuit) 

remanded EPA’s 2007 and 2008 rules implementing the 1997 PM2.5 NAAQS, holding 

that EPA must regulate PM2.5 nonattainment areas pursuant to the same subpart 4 

provisions that apply to PM10 nonattainment areas. Accordingly, the court held that the 

requirements of CAA section 189(e) also apply to PM2.5 nonattainment areas. Butte 

County is designated as nonattainment for the 2006 PM2.5 NAAQS. (See 40 CFR 

81.305.) The EPA has recently promulgated a new provision at 40 CFR 51.165(a)(13) 

that, consistent with the NRDC decision, applies the section 189(e) requirements directly 

to sources of PM2.5. Therefore, consistent with section 189(e) and the new section 

51.165(a)(13), the District’s nonattainment NSR program must regulate major stationary 

sources of VOC, NOx, SO2, and ammonia as PM2.5 precursors, except where the 

Administrator determines that such sources will not contribute significantly to PM2.5

levels that exceed the PM2.5 ambient standards in the area.

Discussion: In its 2013 decision, the D.C. Circuit ordered the EPA to “repromulgate 

these [2007 and 2008 implementation] rules pursuant to subpart 4 consistent with this 

opinion.”6 On June 2, 2014, EPA took a first step to responding to the D.C. Circuit’s 

 6 706 F.3d at 437.
21

order and finalized a rule that set a deadline of December 31, 2014, for States to submit 

“remaining required SIP submissions for [nonattainment] areas, pursuant to and 

considering the application of subpart 4” as to the 1997 and 2006 PM2.5 NAAQS. 

Subsequently, on March 23, 2015, EPA issued a proposed rule for addressing state 

implementation requirements for areas designated nonattainment for any PM2.5 NAAQS.7

On July 29, 2016, the Administrator signed a final notice governing nonattainment area 

SIP requirements for the PM2.5 NAAQS (PM2.5 SIP Requirements Rule), which is 

intended to fully respond to the NRDC decision and implement the requirements of 

subpart 4. 8

As noted earlier, CAA title I subpart 4 includes section 189(e), which requires the control 

of major stationary sources of PM10 precursors (and hence pursuant to the NRDC

decision, PM2.5 precursors) “except where the Administrator determines that such sources 

do not contribute significantly to PM10 [or PM2.5] levels which exceed the standard in the 

area.” The EPA has identified the main precursor gases associated with PM2.5 formation 

as SO2, NOx, VOC, and ammonia. Accordingly, consistent with section 189(e), the final 

PM2.5 SIP Requirements Rule revises the definition of “regulated NSR pollutant” at 40 

CFR 51.165(a)(1)(xxxvii), which identifies all four of these pollutants as precursors to 

PM2.5 for purposes of nonattainment NSR permitting. 

The PM2.5 SIP Requirements Rule also includes a new provision at 40 CFR 51.165(a)(13) 

that implements the section 189(e) requirements with respect to PM2.5. The new provision 

provides that each state’s nonattainment NSR permitting program for PM2.5 shall apply to 

major stationary sources and major modifications of PM2.5 precursors in each PM2.5

nonattainment area, “except that a reviewing authority may exempt new major stationary 

sources and major modifications of a particular precursor from the requirements of this

section for PM2.5 if the NNSR precursor demonstration submitted to and approved by the 

Administrator shows that such sources do not contribute significantly to PM2.5 levels that 

exceed the standard in the area.” A new provision at 40 CFR 51.1006(a)(3) in turn 

provides the minimum requirements for an approvable NNSR precursor demonstration. 

That provision provides that “a NNSR precursor demonstration must evaluate the 

sensitivity of PM2.5 levels in the nonattainment area to an increase in emissions of a 

particular precursor in order to determine whether the resulting air quality changes are 

significant.” 40 CFR 51.1006(a)(3). If such demonstration is approved for a particular 

PM2.5 nonattainment area, the provision provides that the state “may exempt such new 

major stationary sources or major modifications of the particular precursor from the 

requirements for PM2.5 in §51.165 of this part.” Id.

The EPA reviews a state’s SIP submission consistent with the requirements in place at 

the time the EPA acts to approve or disapprove the plan. Accordingly, consistent with the 

requirements of section 189(e) and the final PM2.5 SIP Requirements Rule, the EPA has 

reviewed Butte County’s revisions to its nonattainment NSR permit program for PM2.5 to 

 7 80 FR 15340 (March 23, 2015)

8 Final Rule, Fine Particulate Matter National Ambient Air Quality Standards: State Implementation Plan 

Requirements, pre-publication copy available at https://www.epa.gov/sites/production/files/2016-

07/documents/pm25-naaqs-implementation-final-preamble-rule-signature.pdf.
22

determine whether the revisions appropriately regulate new major stationary sources and 

major modifications of direct PM2.5 emissions and emissions of PM2.5 precursors locating 

in the nonattainment area.

The District’s regulations, Rule 432 Section 4.42, define the term “Regulated NSR 

Pollutant” as any pollutant for which a national ambient air quality standard has been 

established by EPA “and the precursors to such pollutants.” Section 4.33 defines the term 

“Precursor” to include SOx, NOx and VOC as PM2.5 precursors. Accordingly, Rule 432 

appropriately regulates sources of direct PM2.5 emissions and three of the four PM2.5

precursors identified by the EPA, consistent with the requirements of CAA Section 

189(e) and the final PM2.5 SIP Requirements Rule. 

Rule 432 does not list ammonia as a PM2.5 precursor; therefore the District’s 

nonattainment NSR permitting program does not require the regulation of new major 

sources or major modifications of ammonia emissions as it should in the absence of a 

precursor demonstration showing that sources of ammonia do contribute significantly to 

PM2.5 levels in the area. BCAQMD stated in their April 24, 2014 Staff Report that 

because of their relatively small ammonia inventory (1,933 tpy), of which area sources 

contribute 92.4% (mainly fugitives from farming), mobile sources contribute 4.9% and 

stationary sources contribute only 2.7%, they do not believe ammonia contributes 

significantly to PM2.5 levels that exceed the standard in the area. In addition, they noted 

that there are no major stationary sources of ammonia located in Butte County, the largest 

ammonia source only emits about 12 tpy and all ammonia point sources only emit 51.15 

tpy. The District also noted that in 2012 EPA determined through the issuance of a Clean 

Data Determination that the region’s PM2.5 levels do not currently exceed the 24-hour 

PM2.5 standard.9

While the BCAQMD Staff Report addresses current levels of ammonia emissions and 

current air quality, the Staff Report does not consider the sensitivity of the area to an 

increase in ammonia emissions that may occur if one or more new major stationary 

sources were to locate in the area. Such consideration is the minimum requirement 

finalized at 40 CFR 51.1006(a)(3) in the PM2.5 SIP Requirements Rule for states that seek 

to exempt new major sources and major modifications of a precursor from nonattainment 

NSR permitting in a given area. As explained in the final rule, an analysis that evaluates 

the sensitivity of the atmosphere in an area to increases in emissions is important because 

it would most closely replicate the effects on air quality when precursor emissions from 

new major stationary sources or major modifications are added to the existing inventory 

for the area.

While the EPA recognizes that the BCAQMD plan was submitted prior to the final PM2.5

SIP Requirements Rule containing requirements for a NNSR precursor demonstration, 

the EPA, nevertheless finds that the demonstration provided by Butte County as part of 

their NSR program submittal is not adequate to allow the Administrator to determine that 

potential new major sources and major modifications of ammonia emissions will not 

contribute significantly to PM2.5 levels which exceed the standard in the area. 

 9 78 FR 55225 (September 10, 2013)
23

Accordingly, EPA finds Rule 432 deficient because it does not include ammonia as a 

PM2.5 precursor and lacks an adequate demonstration of insignificant contribution. This 

rule deficiency may be corrected by revising the definition of the term “precursor” in 

section 4.33 to include ammonia as a PM2.5 precursor. Alternatively, the state may 

continue to work with the EPA Regional Office to develop an appropriate NNSR 

precursor demonstration that appropriately evaluates the effect on PM2.5 levels in Butte 

County of increases in ammonia emissions, consistent with the final provisions of the 

PM2.5 SIP Requirements Rule.

5.2.25 Requirement: Pursuant to 40 CFR 51.165(a)(11), the SIP must require that in meeting 

the emissions offset requirements of 40 CFR 51.165(a)(3), the emissions offsets obtained 

shall be for the same regulated NSR pollutant unless interprecursor offsetting is permitted 

for a particular pollutant. 

Discussion: Section 5.4 contains the requirements pertaining to interpollutant offsets. It 

specifies, that except for PM2.5, with the approval of the APCO and EPA, interpollutant 

offsets may be used on a case-by-case basis provided the applicant demonstrates through 

the use of an air quality impact analysis that the overall emissions will result in a net air 

quality benefit and not cause or contribute to a violation of any ambient air quality 

standard. This provision satisfies the regulatory requirement. 

5.2.26 Requirement: Pursuant to 40 CFR 51.165(f), the SIP must provide for PALs according 

to the requirements in 40 CFR 51.165(f)(1) through (15).

Discussion: As discussed in Section 6 of this TSD, EPA has determined that it is 

acceptable for BCAQMD to not include provisions related to NSR Reform as a part of 

their NSR program, therefore we find it is acceptable that Rule 432 does not provide PAL 

program. 

5.2.27 Requirement: Pursuant to 40 CFR 51.307(b)(2), the SIP must contain provisions that 

identify additional requirements for any new major source or major modification, 

proposing to locate in a nonattainment area, that may have an impact on visibility in any 

mandatory Class I Federal Area.

Discussion: Rule 432 Subsection 7.3.1 requires an applicant of a proposed new major 

stationary source or any major modification that may affect visibility of a Class I area to 

provide the APCO with a visibility impact analysis in accordance with the requirements 

of 40 CFR 51.307 and 51.166(o). Subsection 7.3.2 requires the APCO to deny an ATC if 

after considering the comments from the appropriate Federal Land Manager, he finds that 

the proposed project would have an adverse impact on visibility. These provisions satisfy 

the regulatory requirement.

5.3 GENERAL NSR REQUIREMENTS
24

CAA section 110(a)(2)(C) requires all States to submit a minor source NSR permitting program 

consistent with the provisions contained in 40 CFR 51.160 through 164 for the review of all new 

stationary sources and modifications of existing stationary sources. The following provides a 

summary of the requirements in 40 CFR 51.160 through 164, and evaluates whether Rules 400, 

401 and 432 satisfy these requirements. 

5.3.1 Requirement: Pursuant to 40 CFR 51.160(a), a permit program must provide the District 

with the authority to require any information required to determine if a proposed project 

will (1) cause a violation of the SIP or (2) interfere with attainment or maintenance of a 

NAAQS.

Discussion: Rule 400 Section 4.3 states that the APCO may require an applicant to 

provide any information, analyses, plans, or specifications which will disclose the nature, 

extent, quality of degree of air contaminants which may be discharged by the source. This 

provision satisfies the regulatory requirement.

5.3.2 Requirement: Pursuant to 40 CFR 51.160(b), a permit program must provide the District 

with the authority to prevent construction or modification if a proposed project will (1) 

cause a violation of the SIP or (2) interfere with attainment or maintenance of a NAAQS.

Discussion: Rule 400 Subsection 4.4.1 states that the APCO shall not grant an ATC or 

PTO unless the APCO determines the source will comply with all applicable 

requirements and will not interfere with maintenance or attainment of an AAQS. This 

provision satisfies the regulatory requirement.

5.3.3 Requirement: Pursuant to 40 CFR 51.160(c), a permit program must provide the District 

with the authority to require information on (1) the nature and amounts of emissions to be 

emitted by the project; and (2) the location, design, construction, and operation of the 

project as may be necessary to allow the APCO to make the determinations required by

40 CFR 51.160(a). 

Discussion: Rule 400 Section 4.3 states that the APCO may require an applicant to 

provide any information, analyses, plans, or specifications which will disclose the nature, 

extent, quality of degree of air contaminants which may be discharged by the source. 

While the rule does not contain a specific provision requiring an applicant to submit 

information regarding the nature and amounts of emissions, EPA has determined that this 

general provision requiring the submittal of all information required to determine 

compliance with the rules is sufficient. Therefore we find that this provision satisfies the 

regulatory requirement.

5.3.4 Requirement: Pursuant to 40 CFR 51.160(d), a permit program must provide that 

approval of any construction or modification must not affect the responsibility on the 

owner or operator to comply with applicable portions of the SIP.
25

Discussion: Rule 400 Subsection 4.4.1 states that the issuance of an ATC shall not 

relieve any owner and operator of the responsibility to comply fully with all applicable 

requirements. This provision satisfies the regulatory requirement.

5.3.5 Requirement: Pursuant to 40 CFR 51.160(e), a permit program must identify the types 

and sizes of facilities, buildings, structures, or installations which will be subject to 

review under 40 CFR part 51, subpart I.

Discussion: Rule 400 Subsection 4.1 generally requires all emission units to obtain an 

ATC prior to construction and operation of any emission unit. However, Section 2 –

Exemptions, specifies that an ATC shall not be required for emission units listed in Rule 

401 – Exemptions. In effect, all new or modified stationary sources must obtain an ATC 

unless specifically exempted by a provision in Rule 401. Taken together, these provisions 

satisfy 40 CFR 51.160(e) because they identify the types and sizes of emission units 

subject to the permit program. We evaluate the approvability of Rule 401 – Exemptions

in Section 5.4 of this TSD. 

5.3.6 Requirement: Pursuant to 40 CFR 51.160(f), a permit program must discuss the air 

quality data and the dispersion or other air quality modeling required to be used to meet 

the requirements of 40 CFR part 51, subpart I. 40 CFR 51.160(f)(1) states that all 

applications of air quality modeling shall be based on the applicable models, data bases, 

and other requirements specified in appendix W of this part (Guideline on Air Quality 

Models). 

Discussion: Rule 400 Subsection 4.10.1 specifies that for the purpose of performing an 

impact analysis, the air quality model shall be consistent with the requirements specified 

in 40 CFR Part 51, Appendix W (“Guidelines on Air Quality Models”), unless the APCO 

finds that such model is inappropriate for use; and that after making such a finding, the 

APCO may designate an alternative model only after allowing for public comment and 

only with the concurrence of CARB and EPA. This provision satisfies the regulatory 

requirement.

5.3.7 Requirement: Pursuant to 40 CFR 51.161, a permit program must contain provisions 

that require an opportunity for public comment on information submitted by the 

applicant, must allow public inspection of information in the area affected, provide a 30-

day comment period, place the notice in a prominent advertisement, send a copy to EPA, 

and for lead, a copy of the notice is required for all point sources. These requirements 

apply for review of new stationary sources and modifications. 

Discussion: Rule 400 Section 4.5 requires the APCO to publish a public notice in at least 

one newspaper of general circulation in the District, which specifies the primary decision, 

how the public may obtain pertinent information, request a public hearing and invite 

written comment for a period of at least 30 days. Subsection 4.5.4 requires the APCO to 

make the application information and analysis and the proposed permit available for 

inspection. Subsection 4.5.3 requires the APCO to provide a copy of all public notice 

documents to ARB and EPA. These provisions satisfy the regulatory requirement.
26

5.3.8 Requirement: Pursuant to 40 CFR 51.162, a permit program must identify the State or 

local agency which will be responsible for meeting the requirements of 40 CFR part 51, 

subpart I. 

Discussion: Section 40200 and 40201 of the California Health and Safety Code identifies 

the Butte County Air Quality Management District as the responsible air pollution agency 

for Butte County. These provisions satisfy the regulatory requirement.

5.3.9 Requirement: Pursuant to 40 CFR 51.163, a permit program must include administrative 

procedures which will be followed in making the determinations specified in 40 CFR 

51.160(a).

Discussion: The administrative procedures for the District’s NSR permitting program are 

set forth in Rule 400 – Permit Requirements. The primary provisions used in making the 

determinations specified in 40 CFR 51.160(a) include: 1) Section 4.1 which requires a 

new or modified stationary source to obtain an ATC from the District before construction 

or modification; 2) Sections 4.3 which contains the requirements for submitting an 

application for an ATC, including the provision that the APCO may require “any 

information, analyses, plans, or specifications which will disclose the nature, extent, 

quality, or degree of air contaminants which are or may be discharged by the source”; and 

3) Subsection 4.4.3 requires that a Permit to Operate not be issued unless information is 

submitted that enables the APCO to determine the source or emissions unit is in 

compliance with all applicable requirements and that it will not interfere with 

maintenance or attainment of an AAQS. Taken together, these provisions satisfy the 

regulatory requirement.

5.3.10 Requirement: Pursuant to 40 CFR 51.164, a permit program must provide procedures 

that provide that the degree of emission limitation required of any source for control of 

any air pollutant must not be affected by so much of any source’s stack height that 

exceeds good engineering practice or by any other dispersion technique, except as 

provided in 40 CFR 51.118(b). Such procedures must provide that before a permitting

agency issues a permit to a stationary source based on a good engineering practice stack 

height that exceeds the height allowed by 40 CFR 51.100(ii)(1) or (2), the permitting

agency must notify the public of the availability of the demonstration study and must 

provide opportunity for public hearing on it. 40 CFR 51.164 does not require such 

procedures to restrict in any manner the actual stack height of any stationary source.

Discussion: Rule 400 Subsection 4.10.3 specifies that for the purpose of performing an 

air quality impact analysis, if the proposed stack height is higher than is dictated by good 

engineering practices, as defined in 40 CFR 100(ii), then the actual height used for the 

purposes of modeling shall be calculated in accordance with good engineering practices. 

This provision satisfies the regulatory requirement. 

5.4 RULE 401 – PERMIT EXEMPTIONS
27

In Section 4.2 of this TSD we provide a description and summary of the contents of this 

rule. For the administrative portions of the rule, including Purpose and Applicability 

Sections 1 & 2, we review the rule for clarity and general enforceability. While Section 3 

Requirements is not an administrative portion of the rule, there are no particular standards 

that apply to this section so we are also evaluating it for clarity and general 

enforceability. Section 3.2 does provide the APCO with the authority to require from any 

source claiming an exemption under the rule to provide any information necessary to 

verify the applicability of the relevant exemption. Section 3.1 clarifies that an application 

is not required to claim applicability of an exemption as long as the records necessary to 

substantiate the exemption are maintained. Finally for the exemptions provided in Section 

5, it provides that the APCO must take a timely action on the submitted application. We 

have reviewed each of these sections of the rule and find them to satisfy requirements for 

clarity and general enforceability. 

As discussed above in Subsection 5.3.5 of this TSD, 40 CFR 51.160(e) requires a permit 

program to identify the types and sizes of facilities, buildings, structures, or installations 

which will be subject to review under 40 CFR part 51, subpart I. BCAQMD Rule 432 –

Federal New Source Review requires all sources to obtain a permit, unless specifically 

listed as exempted from permit requirements in Rule 401 – Permit Exemptions. An

approved NSR program may exempt from permit requirements sources which EPA 

exempts from the NSR program, such as mobile sources; sources with de minimis

emissions; and other selected sources if permitting such sources is not necessary to 

ensure an area can attain and maintain air quality consistent with the NAAQS. 

5.4.1 Sources Exempted by EPA from NSR Program Requirements

Section 4.6 of Rule 401 provides exemptions for motor vehicles (excluding any 

equipment mounted on a motor vehicle that would otherwise require a permit), 

locomotives, airplanes, watercraft and self-propelled mobile construction equipment 

other than pavement burners. CAA Section 302(z) defines the term stationary source for 

purposes of the CAA. The definition specifically excludes emissions resulting directly 

from internal combustion engines used for transportation purposes or from nonroad 

engines or vehicles as defined in CAA Section 216. Because the CAA exempts these 

specific types of mobile sources from the definition of stationary source, it is appropriate 

to provide an exemption from permit requirements for these sources, to clarify that they 

are not subject to the NSR permit program for new and modified stationary sources.

Therefore EPA finds these exemptions acceptable.

5.4.2 Sources Currently Exempted by Rule 04-04 – Exemptions from Permit Requirements

The following exemptions contained in Rule 401 already exist in Rule 04-04 as approved 

in the Butte County portion of the California SIP. As each of these sources are small 

emitters and have been exempt from permit requirements since 1972, EPA believes it is 

appropriate to continue to allow these sources to remain exempt from NSR review permit 

requirements without further review.
28

Equipment Description Rule 

04-04

Rule 

401

Notes

Equipment used at dwellings for not more 

than 4 families

c 4.7.1 Rule 401 increases 

number of families from 

2 to 4, consistent with 

state law.

Comfort air conditioners and ventilation 

systems, not designed to remove air 

containments

d.1 4.7.2 Identical

Refrigeration units, except those used as, or 

in conjunction with, air pollution control 

equipment

d.2 4.7.3 Identical

Water cooling towers and ponds not used 

for evaporative cooling of process water or 

evaporative cooling of water from 

barometric jets or condensers.

d.4 4.1.2 Identical

Equipment used exclusively for steam 

cleaning.

d.5 4.1.1 Identical

Equipment used for space heating, other 

than boilers

e 4.1.4 Provision has been 

clarified to exclude 

boilers as a type of 

space heater.

Equipment used in, or in conjunction with, 

eating establishments for the purpose of 

preparing food for human consumption, 

except coffee roasters.

f 4.2.1 Provision has been 

clarified to exclude 

coffee roasters. 

5.4.3 Internal Combustion Engines

Rule 04-04 Section d.3 contains an exemption for all piston-type internal combustion 

engines. Rule 401 significantly limits this existing provision by providing four separate 

exemption provisions for internal combustion engines (ICE) in Section 4.1.5. This 

includes: 1) engines which have a brake horsepower rating of less than 50; 2) ICEs used 

to educate students in the operation, maintenance, repair and rebuilding of such engines; 

3) any gas-fired engine rated at 250 bhp or less if operated less than 200 hrs per year for 

non-emergency purposes; and 4) fuel cells or micro-turbines used to generate heat or 

power if specific emission limits are met. Each of these provisions contain specific 

limitations (size of engine, hours of operation, emission limits) which ensure that the 

annual emissions from these sources will be relatively small. In addition, there are no 

specific applicable control requirements for these engines. The revision to this exemption 

means that larger engines and engines operated more frequently will now be required to 

obtain an authority to construct and permit to operate. Not requiring permits for these 

sources will not likely affect the District’s ability to attain or maintain the NAAQS, 

therefore EPA finds these exemptions acceptable.
29

5.4.4 Steam Generators, Water Boilers or Water Heaters

Rule 04-04 Section g contains an exemption for steam heated by natural gas, LPG, or 

both. There is no size limitation for this existing permit exemption. Rule 401 Section 

4.1.3 significantly limits this existing provision by setting a maximum fuel input heating 

value of less than 1 million BTU per hour or 30 boiler horsepower for steam heated units, 

while retaining the restriction on the type of fuel allowed. It also clarifies that steam 

heated units include steam generators, water boilers and water heaters. These revisions

mean that steam heating units which use larger amounts of fuel will now be required to 

obtain an authority to construct and permit to operate. Because this exemption limits the 

allowable fuel to natural gas or LPG and to very small units with a capacity of 1 

MMBTU/hr or 30 boiler HP, or less; therefore not requiring permits for these sources 

will likely not affect the District’s ability to attain or maintain the NAAQS. EPA finds 

these exemptions acceptable.

5.4.5 Food and Beverage Processing Equipment

Rule 04-04 Section f contains an exemption for equipment used in eating establishments 

for the purpose of preparing food for human consumption. As noted earlier, Rule 401, 

Section 4.2.1 provides a nearly identical exemption, although it excludes coffee roasters. 

Section 4.2.2 provides an exemption for coffee roasters with a maximum throughput 

rating of 25 lbs/hr or less. This revision means that now only relatively small coffee 

roasters will be exempt from permit requirements. 

New exemptions are provided in Section 4.2 for barbecue equipment not used for: 1) 

commercial purposes; 2) ovens located at bakeries, provided total productions does not 

exceed 5,000 lbs/day and each oven is rated at less than 1 MMBTU/hr; and 3) breweries 

with an annual production rate of less than 1 million gallons, unless any heating source is

larger than 1 MMBTU/hr. 

Overall, these new provisions exempt relatively small emission sources and therefore not 

requiring permits for these sources will likely not affect the District’s ability to attain or 

maintain the NAAQS. EPA finds these exemptions acceptable.

5.4.6 Sources and Equipment Emitting Voltile Organic Compounds (VOC)

Rule 401 provides new exemptions for four source categories whose primary emissions 

are VOC. These include certain Surface Coating Operations, Solvent Cleaning 

Operations, Composting Operations and Printing and Reproduction Equipment. 

• Section 4.3 provides an exemption for non-automotive coating operations using 

less than 1 quart per day and 8 gallons per year of spray coatings, including the 

use of handheld aerosol spray cans. 

• Section 4.4 provides an exemption for unheated solvent cleaning operations 

which lose less than 25 gallons per year of solvent to the atmosphere. 

• Section 4.5 provides an exemption for operations that compost less than 125 tons 

of green waste per year. 
30

• Section 4.12 exempts a graphic arts operation or group of graphic arts operations 

that emit less than an average of 15 lbs of VOC per operating day and less than 

300 lbs of VOC per year. 

In each case the annual usage limit (8 and 25 gallons of paint and solvent, respectively,

and 125 tpy of green waste processed) or the annual emission limit (300 lbs of VOC per 

year) ensure that the equipment or operation being exempted only result in small annual 

emissions and therefore not requiring permits for these sources will likely not affect the 

District’s ability to attain or maintain the NAAQS. EPA finds these exemptions 

acceptable.

In addition, Section 4.7.4 of Rule 401 provides an exemption for the application of 

architectural or industrial coatings, which are subject to requirements of other District 

rules which provide VOC content limitations when applied to structures and their

appurtenances. District Rule 230 – Architectural Coatings, limits the VOC content of all 

architectural coatings supplied, sold, offered for sale, applied solicited for application or 

manufactured for use within the District. Because the VOC content of these coatings are 

controlled through the sale of the materials, EPA finds it acceptable to provide an 

exemption from permit requirements for the application of these coatings.

5.4.7 Process Heaters

Rule 401 Section 4.1.6 provides new exemptions for certain types of small metal melting 

furnaces, provided their maximum rated capacity is less than 450 cubic inches of any 

molten metal; and for kilns firing ceramic ware if they are heated exclusively with natural 

gas, liquefied petroleum gas and/or electricity. For these process heaters, the 450 cubic 

inch size limitation for the furnaces and the requirement to use clean gaseous fuels for the 

kilns ensure that the equipment being exempted will only result in small annual emissions 

and therefore will likely not affect the District’s ability to attain or maintain the NAAQS.

EPA finds these exemptions acceptable.

5.4.8 Portable Equipment

Rule 401 Sections 4.8 and 4.14 provide new exemptions for various types of portable 

equipment. Section 4.8 exempts portable handheld equipment used for various types of 

machining of metal, wood, plastic or similar materials. This type of small handheld 

equipment can be expected to have only small annual emissions due to portability of the 

equipment which causes the equipment to also be small. This ensures that the equipment 

being exempted will only result in limited annual emissions and will not likely affect the 

District’s ability to attain or maintain the NAAQS. EPA finds this exemption acceptable.

Section 4.14 exempts any portable equipment that is registered with the District or the 

Statewide Portable Equipment Registration Program, but excludes equipment used to 

screen soils in contaminated soil remediation projects. In this case, the District is 

choosing a different form of regulation, registration in place of permitting. Rule 101 –

Definitions, defines a portable emissions unit as one that does not remain at a fixed 

location for more than twelve consecutive months. Such portable equipment would not 
31

meet the definition of a stationary source and is therefore not subject to NSR permit 

program requirements. EPA finds this exemption acceptable.

5.4.9 Abrasive Blasting Equipment

Rule 401 Section 4.9 provides new exemptions for abrasive blasting equipment which 

uses a suspension of abrasive in water, or cabinets with a volume of less than 100 cubic 

feet which are vented through a control device. The requirement to use only wet 

abrasives or within a relatively small cabinet ensures that the equipment being exempted 

will only result in only very small quantities of annual emissions and therefore will likely 

not affect the District’s ability to attain or maintain the NAAQS. EPA finds this 

exemption acceptable.

5.4.10 Routine Repairs and Maintenance

Rule 401 Section 4.11 provides a new exemption for routine repairs and maintenance 

which do not involve structural changes to an emission unit. This provision is consistent 

with the definition of major modification found in 40 CFR 51.165((a)(1)(v)(C)(1) which 

states that routine maintenance, repair and replacements are not physical changes or 

changes in the method of operation and therefore are not modifications. These activities 

are specifically excluded from the definition of modification to ensure such activities are 

not subject to NSR permit requirements. Therefore we find this permit exemption 

acceptable. 

5.4.11 Wastewater Facilities

Rule 401 Section 4.13 provides new exemptions for wastewater treatment facilities, water 

reclamation facilities, and wastewater pump stations with a design throughput capacity of 

less than one (1) million gallons of wastewater per day. For these types of wastewater 

facilities, the design limitation of less than one million gallons per day ensures that the 

equipment being exempted will only result in small annual emissions and therefore will 

likely not affect the District’s ability to attain or maintain the NAAQS. EPA finds this 

exemption acceptable.

5.4.12 Fabrication Operations

Rule 401 Section 4.13 provides new exemptions woodworking and other fabrication 

operation that utilize shop dust collection systems that do not vent outside the working 

area of the facility. For these fabrication operations, the provision prohibiting the exhaust 

from the dust collection system from being vented outside of the work area ensures that 

these devices will be well controlled and therefore will likely not affect the District’s 

ability to attain or maintain the NAAQS. EPA finds this exemption acceptable.

5.4.13 Walnut Hullers

Rule 401 Section 4.17 provides a new exemption for walnut hulling facilities processing 

only crops grown by the owner that utilize a wet process hull removal, and with a drying 

fuel consumption of less than 5,500 gallons of propane per year or 52 therms of natural 

gas per year. For walnut huller facilities, the applicability restrictions of being owner 

operated and using a wet process, as well as the limitations on the amount and type of 

fuel used ensure that the equipment being exempted will only result in small annual 
32

emissions and therefore will likely not affect the District’s ability to attain or maintain the 

NAAQS. EPA finds this exemption acceptable.

5.4.14 Pilot Tests

Rule 401 Section 4.16 provides a new exemption for pilot tests used to determine 

contamination levels for designing a soil remediation system providing; 1) the pilot test 

will not last more than five (5) days; and 2) the effluent stream emissions from the pilot 

test are controlled. For these operations, the exemption is limited to a short testing period 

(5 days) and the emissions from the test must be controlled. Both of these provisions 

ensure that the equipment being exempted will only result in small annual emissions and 

therefore will likely not affect the District’s ability to attain or maintain the NAAQS. 

EPA finds this exemption acceptable.

5.4.15 Agricultural Sources

Rule 04-04 Section j contains an exemption for agricultural implements used in 

agricultural operations. Rule 401 Section 4.13 provides a new exemption for any engine 

or equipment used in agricultural operations at an agricultural source except when the 

agricultural source: 1) is a new major source or major modification as defined in Rule 

432 – Federal New Source Review; 2) emits more than 50% of the major source threshold 

as defined in 40 CFR Part 70.2, excluding Hazardous Air Pollutants (HAP); 3) emits 

more than 5 tpy of a single HAP or 12.5 tpy of any combination of HAPs; or 4) 50% of 

any lesser HAP threshold established by EPA. BCAQMD revised the existing general 

exemption for agricultural operations in accordance with state law (SB700) provisions 

regarding air permit requirements for agricultural sources. 

While the exemption threshold of 50% of any applicable major source threshold (in Butte 

County this equates to 50 tpy for any pollutant with a NAAQS) is a relatively high 

emission threshold for providing a permit exemption, EPA notes that this threshold is 

significantly less than the existing exemption which contained no emission thresholds. 

We also note that the BCAQMD has been able to come into attainment with both the 

2008 8-hr ozone NAAQS and the 24-hr PM2.5 NAAQS while exempting agricultural 

operations at this threshold. Therefore maintaining this exemption threshold will likely 

not affect the District’s ability to attain or maintain the NAAQS. EPA finds this 

exemption acceptable.

5.4.16 Low Emitting Sources

Rule 401 Section 4.18 provides a new exemption for any other emission unit (source) 

with uncontrolled emissions at the following rates: 1) for CO, emissions of less than 500 

lbs/day, and 2) for all other NAAQS pollutants except lead, at less than or equal to 2 

lbs/day or 75 lbs/yr. This general exemption allows the District to exempt very small 

emission sources that are not specifically listed in the rule from permit requirements. 

Since this new provision exempts only very small emission sources, not requiring permits 

for these sources will likely not affect the District’s ability to attain or maintain the 

NAAQS. EPA finds this exemption acceptable.

5.4.17 Conditionally Exempt Sources
33

Rule 401, Section 5 contains two exemption provisions which require the source to 

submit a permit application so that the request for exemption may be evaluated. The 

provision in Subsection 5.1.1 applies to identical replacements where the equipment has 

the same manufacturer, model number and type and the resulting emissions are less than 

or equal to those from the original equipment, and the modification does not require a 

change in permit conditions. Such an identical replacement ensures that there is no 

increase in the potential to emit of the equipment while allowing the District to review 

such modifications to ensure they meet all of the specified requirements. 

The provision in Subsection 5.1.2 applies to any other emission unit with an uncontrolled 

emission rate of less than 500 lbs/yr for each air contaminant. This provision allows the 

APCO to exempt any other low emitting source that was not considered when Rule 401 

was written. The emission limitation of 500 lbs/yr ensures that the equipment being 

exempted will only result in small annual emissions and therefore will likely not affect 

the District’s ability to attain or maintain the NAAQS. EPA finds this exemption 

acceptable.

5.4.18 Recordkeeping and Compliance Schedule

Rule 401 Section 6 provides recordkeeping requirements for sources claiming an 

exemption pursuant to the rule. It specifies the types of records that must be maintained 

to demonstrate with the exemption requirements, such as fuel use, operating hours and 

material usage. It also requires that all records me maintained on site for at least two 

years and made available upon request. These provisions provide a mechanism to verify 

compliance with the provisions of Rule, and EPA finds them acceptable. 

Rule 401 Section 7 provides a compliance schedule for sources that lose their permit 

exemption, either through the adoption of Rule 401 revisions or because the source 

exceeds one of the exemption limiting parameters, such as an annual fuel limit. Providing 

such a timeline for required action provides additional clarity to rule which also improves 

enforceability. EPA finds these provisions acceptable. 

6. NEW SOURCE REVIEW REFORMS

6.1 CALIFORNIA CLEAN AIR ACT – NEW SOURCE REVIEW PROGRAM

The air quality in California has historically been some of the worst in the nation. In light of this 

fact, California has always been at the forefront in implementing strict air quality regulations to 

address the state’s serious air quality problems. 

In 1959, the State passed its first air quality standards for total suspended particulates, 

photochemical oxidants, sulfur dioxide, nitrogen dioxide, and carbon monoxide. These state 

standards were amended in 1969 by the California Air Resources Board. At that time, the 

California ambient air quality standard for ozone was lower than the federal standard, thus most 

of California was exceeding the state standard for Ozone. As a result, most California Air 

Pollution control agencies developed permitting programs that contained non-attainment new 
34

source review requirements such as Lowest Achievable Emissions Rate (LAER) and offsets 

around the same time as the adoption of the federal Clean Air Act in 1970. 

In 1988, California adopted the California Clean Air Act of 1988 (California CAA). This 

legislation established new preconstruction review requirements for new and modified sources. It 

established uniform emission thresholds that trigger control and offset requirements for ozone 

(VOC and NOx), carbon monoxide (CO), sulfur dioxide (SO2) and nitrogen dioxide (NO2) at 

levels significantly lower than the federal thresholds in effect at the time of adoption. These 

thresholds are even lower than the thresholds established two years later by the federal Clean Air 

Act Amendments of 1990 (federal CAA). 

Under both state and federal requirements, all ozone nonattainment areas were classified 

according to the severity of the ozone violations measured for each area. Instead of a single 

major source threshold for all areas, the federal CAA set new major source and major 

modification thresholds of 100 and 40 tons per year (tpy) respectively, for areas classified as 

moderate or marginal; 50 and 25 tpy respectively, for areas classified as serious; 25 and 25 tpy 

respectively, for areas classified as severe; and 10 and 0 tpy respectively, for areas classified as 

extreme. These thresholds are used to determine when a proposed project requires the application 

of LAER and emission offsets. 

In comparison, the California CAA set thresholds for when project emissions trigger the 

application of the California version of Best Available Control Technology (BACT) and offsets. 

(Note that CA BACT is defined in such a manner as to be equivalent to federal LAER 

requirements.) The application of CA BACT is triggered for emission increases of 25 lb/day in 

areas classified as moderate and 10 lbs/day in areas classified as serious, severe or extreme. In 

addition, some California Districts have adopted even lower CA BACT thresholds of two and 

zero lb/day. The requirement to provide offsets is triggered for all emission increases, once a 

facility’s emissions exceed 25 tpy in areas classified as moderate; 15 tpy in areas classified as 

serious; and 10 tpy in areas classified as severe or extreme. 

California and Federal BACT/LAER and Offset Thresholds for 1-hr Ozone

CA Ozone Classification 

(ppm)

Marginal Moderate 

(0.09 -

≤0.12)

Serious 

(0.13 -

≤0.15)

Severe 

(0.16 -

≤0.20)

Extreme 

(>0.20)

CA BACT10 (tpy) [lb/day] NA 4.6 [25] 1.8 [10] 1.8 [10] 1.8 [10]

CA Offset (tpy) NA 25 15 10 10

EPA Ozone Classification 

(ppm)

Marginal

(0.121 -

<0.138)

Moderate 

(0.138 -

≤0.160)

Serious 

(0.160 -

≤0.180)

Severe 

(0.180 -

≤0.280)

Extreme 

(>0.28)

Federal Major Source (tpy)

(Triggers both LAER & 

Offsets)

100 100 50 25 10

Federal Major Mods (tpy) 

(Triggers both LAER & 

Offsets)

40 40 25 25 0

Note: California design values are lower than federal values for the same classification.

 

10 California Health & Safety Code §§ 40918, 40919, 40920 and 40920.5
35

6.2 NSR REFORM PROGRAM REQUIREMENTS

On December 30, 2002, EPA published a final rulemaking action to provide additional flexibility 

in the permitting of modified sources subject to the federal major source NSR and PSD 

programs. EPA’s intent was to allow existing sources additional flexibility in the NSR/PSD 

permitting process that would encourage facilities to make process improvements or undertake 

energy efficiency projects that would provide additional environmental benefits by reducing 

emissions on a capacity basis. In 2005, a court vacated two NSR Reform provisions,11 but also 

upheld three key provisions. These provisions all pertain to how emission increases from 

proposed modifications of existing sources are calculated. 

One provision allows an existing facility to set a Plantwide Applicability Limit (PAL), which in

effect is a facility-wide emissions cap for a specific pollutant. Once the PAL is determined, a 

facility can make any physical modification or change in the method of operation, which might 

otherwise trigger a major modification, without obtaining a NSR permit, as long as the plantwide 

emissions remain below the PAL level. For certain types of industries that need significant 

operational flexibility to make quick changes in response to changing market conditions, the 

ability to make changes without having to wait for the issuance of construction permits is worth 

the additional work to ensure emissions from all operations remain below the PAL and maintain 

the additional records needed to verify compliance with the plant-wide emission limits. 

Another provision changed the allowable time frame to be used to determine baseline actual 

emissions for non-Electric Generation Units. Baseline emissions are generally considered to be 

the pre-project emissions from the facility or emission units proposed to be modified. Prior to 

implementing the NSR Reforms, EPA required a source to use the actual emissions emitted 

during the two year period immediately preceding the application date for the new project. 

Sources were allowed to use a different two year period within the five year period immediately 

preceding the application date if they could demonstrate that the alternative two year period was 

more representative of normal operations. The NSR Reforms revised the allowable time frame to 

be any 24 month period during the 10 year period immediately preceding the application date. 

EPA believes that the use of a 10 year period allows a source to look back to a period from a 

more representative business cycle, i.e., 10 years vs. five years, and that significant resources are 

conserved by allowing the source to choose the 24 month period used to establish baseline actual 

emissions, rather than spend time and resources determining what period most represents 

“normal operations.” While going back further in time means a source may be able to choose a 

period with higher average emissions, the NSR Reforms also added requirements to ensure the 

baseline period is adjusted for any excess emissions or any additional emission reductions 

required by new regulations which have become effective since the baseline period. 

The third provision upheld by the court changed how post-project emissions are determined. 

Prior to implementing the NSR Reforms, EPA required a source to use the worst case potential 

to emit (PTE) assumptions (i.e., operating at 100% capacity, 24 hrs/day, 7 days a week), unless 

the applicant agreed to practically enforceable permit conditions to limit operation of the 

 

11 The United States Court of Appeals for the District of Columbia Circuit in State of New York, et al., v. U.S. 

Environmental Protection Agency, et al., 413 F.3d 3 (D.C. Cir. 2005)
36

emission unit (i.e. fuel usage limits or limits on hours of operation). In this “actual to potential” 

test, often the difference between the baseline actual emissions and the PTE of an operation 

would be greater than the major modification significance thresholds. As a result, many 

modifications were treated as major modifications, even when the actual emissions would 

decrease, not change, or the actual increase in emissions would not be significant. The NSR 

Reforms changed the post-project emission calculation methodology to allow a source to use the 

highest actual emission rate projected to occur over the next 5 or 10 years and to subtract 

emissions the emission units could have accommodated prior to the project, that were unrelated 

to the project, in order to determine the emission increase from the proposed project. 

It is important to note that none of these revisions changed the major modification significance 

thresholds for triggering control technology and offset requirements. They only changed the 

calculation to determine if the major modification threshold is triggered. 

6.3 IMPACTS OF FEDERAL NSR REFORMS ON CALIFORNIA NSR PERMITTING PROGRAMS

By not adopting the NSR Reforms, the NSR program in California Districts would not include 

the three program elements described earlier: use of PALs, a 10 year look back period for 

baseline actual emissions and projected actual emissions non-Electric Generation Units. The use 

of two of these three provisions (baseline actual emissions and projected actual emissions) is 

required under 40 CFR 51.165(a)(2). The requirement to adopt a NSR program that allows the 

use of PALs is found in 40 CFR 51.165(f). 

Section 116 of the CAA12 provides that nothing in the Act shall preclude the rights of States to 

adopt air pollution regulations that are more stringent than those contained in the CAA or 

implementing regulations. As noted above, the California CAA of 1988 adopted lower emission 

thresholds for triggering emission control (BACT/LAER) and offset requirements for new and 

modified sources as part of its NSR program. Consistent with this concept, when EPA adopted 

new calculation methods to implement the NSR Reforms in 40 CFR 51.165(a)(2), we also stated 

that each plan must use the specific applicability provisions specified unless the State 

specifically demonstrates that the submitted plan provisions “are more stringent than or at least 

as stringent” in all respects as the specified paragraphs. These applicability provisions specify the 

use of baseline actual emissions and projected actual emissions, two of the new NSR Reform 

provisions, but also retain the option for a source to use the actual to potential emission test. 

Several air districts in California have argued that their NSR and PSD permit programs are 

inherently more stringent than the required federal program because the applicability thresholds 

for applying CA BACT and offsets are significantly lower than those in the federal CAA. In 

 

12 Section 116 of the CAA: Except as otherwise provided in sections 119 (c), (e), and (f) (as in effect before the 

date of the enactment of the Clean Air Act Amendments of 1977), 209, 211(c)(4), and 233 (preempting certain State 

regulation of moving sources) nothing in this Act shall preclude or deny the right of any State or political 

subdivision thereof to adopt or enforce (1) any standard or limitation respecting emissions of air pollutants or (2) 

any requirement respecting control or abatement of air pollution; except that if an emission standard or limitation is 

in effect under an applicable implementation plan or under section 111 or 112, such State or political subdivision 

may not adopt or enforce any emission standard or limitation which is less stringent than the standard or limitation 

under such plan or section.
37

addition, for modifications, a source does not need to be a major source, as it does for federal 

purposes, before these lower applicability thresholds apply to a proposed project. The districts 

also point out that if a District adopted the NSR Reform calculation methods, and a project using 

these methods was no longer classified as a major modification, it would not be subject to 

Federal LAER and offsets requirements for NSR or Federal BACT for PSD; but the project 

would still have to apply CA BACT and provide offsets in accordance with the CA CAA 

requirements. These lower State emission thresholds are already in almost all Districts’ portion 

of the California SIP, making these requirements enforceable under both state and federal law. 

As a result, CA Districts have argued that the regulatory framework found in other states, where 

adopting the NSR Reforms provide additional permitting flexibility and environmental benefits, 

do not exist in California because adoption of the reform requirements would have no effect on 

the application of control technology or offset requirements. 

EPA has reviewed the Districts’ claims and considered how the CA CAA provisions affect the 

effectiveness of the NSR Reforms to provide the intended regulatory relief, and we agree that the 

application of CA BACT and offsets at significantly lower thresholds means that the federal 

NSR Reform provisions do not provide any of EPA’s intended additional flexibility to proposed 

projects that may otherwise trigger federal major modification requirements. If the State adopts 

these provisions, a new project will have to complete two different sets of emission calculations; 

and even if the federal requirements are not applicable, the source will still have to comply with 

the CA BACT control and offset requirements if they are triggered. In light of these facts, EPA is 

proposing to find that it is acceptable for BCAQMD to not incorporate the NSR Reform 

provisions into their SIP approved NSR program, since the same level of control will be required 

for modified sources, with or without inclusion of these provisions in the SIP, and their program 

will not be any less stringent than the federal program. 

7. CLEAN AIR ACT SECTION 110(l) ANALYSIS

Rules 400, 401 and 432 are intended to satisfy the requirements of section 110(a)(2)(C) and part 

D of title I of the Act. Section 110(l) of the CAA states that each SIP revision submitted by a 

State shall be adopted by such State after reasonable notice and public hearing. It also states that 

the Administrator shall not approve a SIP revision if the revision would interfere with any 

applicable requirement concerning attainment and reasonable further progress, or any other CAA 

applicable requirement.

With respect to the procedural requirements of CAA section 110(l), based on our review of the 

public process documentation included in the November 6, 2014 SIP submittal package, we find 

that BCAQMD has provided sufficient evidence of public notice and opportunity for comment 

and public hearings prior to adoption and submittal of these rules to EPA. 

With respect to the substantive requirements of section 110(l), only Rules 400 and 401 are SIP 

revisions, as Rule 432 is a new rule submitted for SIP approval. As outlined in Table 3 of this 

TSD, Rules 400 and 401 replace several existing rules in the current SIP. All of the provisions 

Rule 400 are replacing are administrative rules which will not affect in any way the District’s 

ability to attain and maintain the NAAQS. Rule 401 provides several new provisions exempting 
38

additional emission sources from permit requirements. Some of these exemptions, such as the 

ones for mobile sources are not subject to NSR permit program requirements regardless of 

whether Rule 401 provides a permit exemption. For the remaining new exemptions, as discussed 

in Section 5.3 of this TSD, we have found as part of our evaluation that these exemptions 

represent small emission sources which are typically not subject to any specific regulatory 

requirement to control their emissions. Therefore EPA has determined that our approval of Rule 

401 will not interfere with any applicable requirement concerning attainment and RFP or any 

other applicable requirement of the Act.

For the reasons set forth above, we can approve the BCAQMD SIP revision as proposed in this 

action under section 110(l) of the Act.

8. CLEAN AIR ACT SECTION 193 ANALYSIS

Section 193 of the Act, which was added by the Clean Air Act Amendments of 1990, includes a 

savings clause which provides, in pertinent part: “No control requirement in effect, or required to 

be adopted by an order, settlement agreement, or plan in effect before November 15, 1990, in 

any area which is a nonattainment area for any air pollutant may be modified after November 15, 

1990, in any manner unless the modification insures equivalent or greater emission reductions of 

such air pollutant.” 

The provisions of Section 193 are not applicable to this action because currently there are no 

NSR program provisions contained in the Butte County portion of the California SIP. 

9. EPA’S PROPOSED ACTION

Pursuant to section 110(k)(3) of the Act, we are proposing full approval of Rules 400 and 401 as 

part of BCAQMD’s general NSR permitting program because we have determined that these 

rules satisfy the substantive statutory and regulatory requirements for a general NSR permit 

program as contained in CAA section 110(a)(2)(C) and 40 CFR 51.160 - 51.164.. We are 

proposing a limited approval of Rule 432 because we have determined that Rule 432 satisfies all 

of the statutory and regulatory requirements for a nonattainment NSR permit program as set forth 

in the applicable provisions of part D of title I of the Act (sections 172, 173 and 182(a)) and in 

40 CFR 51.165 and 40 CFR 51.307. We are also proposing a limited disapproval of Rule 432 

because we have determined that the rule does not fully satisfy CAA section 189(e)’s 

requirements for regulation of PM2.5 precursors as it pertains to ammonia.

EPA is also proposing to find that it is acceptable for BCAQMD to not incorporate the NSR 

Reform provisions of 40 CFR 51.165 into its NSR permit program because BCAQMD’s 

permitting program will not be any less stringent than the federal permitting program. In support 

of this proposed action, we have concluded that our approval of the submitted rules would 

comply with the requirements of section 110(l) of the Act because the amended rules will not 

interfere with continued attainment of the NAAQS in Butte County. If we finalize this action as 

proposed, our action will be codified through revisions to 40 CFR 52.220 (Identification of 

Plan).
39

10. REFERENCES

Copies of all documents referenced in this TSD are located in Docket No. EPA-R09-OAR-2016 

–0322 for this rulemaking action.