# STATE OF COLORADO Bill Ritter, Jr., Governor James B. Martin, Executive Director Dedicated to protecting and improvi ng the health and environment of th e people of Colorado 4300 Cherry Creek Dr. S . Laboratory Services Division Denver, Colorado 80246-1530 8100 Lowry Blvd. Phone (303) 692- 2000 Denver, Colorado 80230-6928 TOO Line (303) 691-7700 (303) 692 · 3090 L ocated in Glendale , Colorado h ttp :// www.cdphe . state . co.us June 18 , 2009 Caro l Rushin Acting Regional Administrator US EPA Region VIII 1595 Wynkoop Street Denver, CO 80202-1129 Dear Ms. Rushin: 

# RECBIVBD JUN 28 

## 2009 

# USEPARNS OFFICE The following actions are submitted to EPA for fina l approval and incorporation into the Colorado State Implementation Plan. Two copies ofthe materials needed for your review ofeach action are included with this letter. • Regu lation Number 3: Stationary Industrial Source Emission Fees
- On September 18, 2008 the Colorado Air Quality Control Commission (AQCC) adopted a proposal to increase the fees charged to stationary industrial sources for emissions ofreg ulated air pollutants to reflect the changes that the leg islature made to the air pollutant emission fees. • Regulation Number 11: Motor Vehicle Emiss ions Inspection Pr ogram - On October 16 , 2008 the AQCC adopted a proposal to revise the emission control systems inspection procedures for 1996 and newer model year vehicles and to elim inate obsolete provisions for gasoline filler neck inspections and chlorofluorocarbon leak check requirements. • Regulatio n Number 10 : Tran sportation Conformity
- On November 20, 2008 the AQCC adopted a proposal to include changes that EPA had made to the federal program that reflected changes in federal transportation legislation. • Canon City PM I 0 Maintenance Plan
- On November 20, 2008 the AQCC adopted a proposal to revise the Canon City PM 10 element of the State I mplementation Plan to satis fy the federal requirement for demonstrating long-term compliance with the national standard for a second tenyear period after the area h ad shown that it cou ld achieve and maintain long-term compliance with the national standard . • Regulation Numbers 3 , 7 , 11 , Ambient Air Quality Standards , and Ozone State Implementation Plan: Long- t erm Compliance wit h the National Eight-hour Ozone Standard
- on December 12,..... . "'**~~ ~** **r~·** ,.,. 

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### ~ '· 1 , • I )**r-:1~** rf!1 ., l. • • " ..... -Carol Rushin June 18 , 2009 Page 2 2008 the AQCC adopted a State Implementation Plan e lement and a set of requirements to ensure compli ance with the 1997 National Amb ient Air Quality Standard for eight-hour ozo ne set at 0.08 ppm (part per million) by the end of20 10. The AQCC acted to adopt severa l new requirements for stationary and mobile sources. • Regulation Number 3: Regional Haze Requirements for Stationary Source Permitting
- On December 19 ,2008 the AQCC adopted a set of Best Available Retrofit Technology (BART) requirements for the Colorado Springs Utilities and the CEMEX-Lyons Cement Plant pursuant to the provisions of the federal regional h aze rule. We look forward to your timely review and approval ofthi s request. The AQCC office may submit any additional technical support documentation or information that you may need for review directly to EPA. Should there be any quest ions regarding these ma terial s, please contact the AQCC office at 303-692-3478. Thank yo u. Sincerely ,

cc: Martha Rudolph , Director ofE nvironmental Programs Doug Lempke , Administrator, Colorado Air Qual ity Control Commission Paul Tourangeau, Director, Air Pollution Control Division

# Stationary Source Permitting and Air Pollutant E mission Notice Requirements

Regulation Number 3, Part A

AD MI NISTRAT IV E MATERIA L S Copies of the following administrative material s are included in this submittal ofrevisions to Regulation Number 3, Part A: Stationary Source Permitting and Air Pollutant Em ission Notice Requirements. Hearing held on September 18, 2008. • Hearing Notice and Proposed Language as Published in the CCR • Meeting Agenda where Public Hearing Occurred and Notice published in the Legal Ads of the Denver Post • Procedural Documents ofth e Commission (t his includes the Agenda Item Control Sheet, the Memorandum of Notice, the Economic Impact Analysis) • Parties Hearing Documents (this inclu des a list of the parties, the parties prehearing statements and rebuttal statements, and any orders by the Commission
- - do not include a ll the attachments from the parties) • EPA Comments • Public Comments • Adopted Statement of Basis, Specific Statutory Authority and Purpose • Adopted Language by the Commission (in redline & footer noting adoption date and page numbers) • Final Adoption Notice • Opinion of the Attorney General • Regu l ation as published in the CCR (this is the version that i s published by Lexis Nex is)

# Hearing Notice and Proposed Language as Published in the CCR

# STATE OF COLORADO Bill Ritter, Jr . , Governor Jam es B . Martin, Executive Director Dedicated to protecting and Imp roving the h e alth and envir onment of th e people of Colorado COLORADO AIR QUALITY CONTROL COMMISS ION http :// www .cdphc.statc.co. us EDO-AQC C- A 5 4300 Cherry C reek Drive South Denver, Colorado 80246-1530 Phone (303) 692-3100 Fax (303) 691-7702 TDD (303) 691
- 7700 Colorado Department of Public Health and Environment 

### NOTICE OF PUBLIC RULEMAKING HEARING BEFORE T HE COLORADO AIR QUALITY CONTROL COMMISSION Regarding proposed revisions to: 

### Regulation N umb er 3 STATIONARY SOURCE PERMITTING AND AIR POLLUTION EMISSION NOTICE REQUI R EMENTS 

### · Part A, Section VI.D.l. CONERNING THE INCREASE OF STATIONARY SOURCE EMIS SION FEES SUBJECT: T he Air Quality Control Commis s ion will hold a pub lic rulemaking hearing to consider proposed revisions to its Regulation Number 3, Part A, Section VLD.L that would raise the annual emission fees for criteria and hazardous air pollutants in accordance with the provisions of Section 25 -7-114.7. C.R.S. The proposed increase raises (ees to the limit set by Colorado Legislature and would be used to fund legislatively approved staffing increases to address permitting, oil and gas activities, and additional air quality monitoring. FEDERAL REQUIREMENTS : The federal act does not require the Commission to make any ofthe rule revisions that are the subject ofthis Notice of Public Rulemaking Hearing . A proposed Statement ofBasis , Specific Statutory Authority , and Purpose and a regulatory analysis (if one has been requested) will b e avail able for inspection no later than five (5) days prior to the hearing. The proposed language for the rul e revision is attached to and made a part 

### of this notice. HEARING SCHEDULE: DATE: September 18 ,2008 TIME: 9:00AM PLACE: Colorado Depart ment ofPublic Health & Environment 4300 Cherry Creek Drive South, Sabin ConfRoom Denver, Colorado 80246
Page I o f4The hearin g may be continued at such places and time as the Commission ma y announce. Interestedparties may contact the Commission Office at 303-692-3476 to co nfirm meeting dates and times. 

### The Commission shall deliberate upon th e evidence; testimony and written submi ssions present ed at 

### this hearing, as well as any related matters properly s ubmitted before the hearing record i s closed . PUBLIC COMMENT: The Co mmi ss io n encourages all intere s ted per so ns to provide their views either o rally at the hearing or in writing prior to or at the hearing. The Commission especia lly so licits comments and analyses from persons who will incur directly some cost or benefit from the proposed revisions. Public testimony will be taken as close to the start ofthe hearing as possible and during the hearing as 

### nece ssary. Written and/or electronic submissions prior to the hearing are reque sted to allow review prior to presentation at the heari ng. Written and /o r electronic submission s sho uld be mailed to the Commi ssion Office at least 

### 14 days prior to the hearing. 

### PARTY STATUS: In order to obtain party s tatus at the hearing, compliance with several requirements as defined in the Commissions Procedural Rules is necessary. A petition for party status must be 

### filed by electronic mail with the Office of the Air Quality Control Co mmission no later than close of business on July 18 , 2008. The petition mus t: 1) identify the applicant; 2) provide the name, address, telephone and facsimile number s, and e mail addr ess of the applicants representative ; and 3) br iefly summarize what, 

## if any, policy,fac tual, and legal issues the applicant has with the proposal(s) as of the tim e of filing the application. 

### Electronically mailed copies must also be received , by this same date, by the Division staffperson and the Assistant Attorneys General representing the Divisio n and the Commiss ion identified below. Any person may petition the Commi ssion to file doc uments 

### in paper copy format ifthey are unable for any reason to not comply with the re quirements of 1.3.8(2) ofthe Commiss ions Procedural Rule s . An o riginal and a specified number ofpaper copies must be filed in the Office ofthe Air Quality Co ntr ol Co mmis sio n, Colorado Department of Public He alth and Env ir onment, 4300 Cherry Creek Drive South, Denver, Colorado 80246 . Individuals may also obtain party sta tu s through the s ubmittal of 

### an initial alternative rule to the proposed rule. The s ubmittal of an alternative proposal must be accompanied by an electronic copy ofthe initial alternative proposed rule and all other associated documents as required by the Commi ss io n 's procedural rules and must be filed by electronic mail with the Office ofthe Commi ssion by th e date sp ecified for party s tatus reque s ts. Initial alternati ve rules mus t al so be filed by electronic mail with the Division staffperson and with each ofthe Assistant Attorneys General. Air Quality Control Commission Theresa 

### L. Martin EDO
-AQCC-A5 4300 C herry Creek Drive South Denver, CO 80246 Theresa.Martin@state.co.us Air Pollution Co ntrol Division Kirsten King APCD-Bl 4 300 Cherry C reek Drive South Denver, C O 80246 Kirs ten.King@state .co.us Pag e 2 of4Jerry Goad Attorney for the Commission Attorney General's Office 1525 Sherman St., 5 1 h Floor Denver, CO 80203 Jerrv . Goad@state.co.us William Allison Attorney for the Division Attorney General's Office 1525 Sherman St., 5 1h Floor Denver, CO 80203 William.Allison@state.co.us Requests received beyond the above stated deadline shall only be considered upon a written motion for good cause shown. The Commission reserves the right to deny party status to anyone that does not comply with the Commiss ion 's procedural rules. 

### STATUS CONFERENCE: A status conference will be held July 24 at 10:00 a.m., at the Department of Public Health and Environment to ascertain and discuss the issues involved, and to ensure that parties are making all necessary efforts to discuss and resolve such issues prior to the submission of prehearing statements. Attendance at this status conference is mandatory for anyone who has requested party status. 

### PREHEARING CONFERENCEIPREHEARING STATEMENTS: Attendance at the prehearing conference is mandatory for all parties to this hearing. A prehearing conference will be held August 20, 2008 at 9:00 a.m. in the Commission Offices at 4300 Cherry Creek Drive South, Denver. All parties must submit by electronic mail a preliminary prehearing statement to the Commission Office by close**ofbusines ~**  April15, 2008 . In addition, e lectronically mailed copies ofthese documents must be delivered by that date to all persons who have requested party status. A copy ofthe preheaTing statement must also be electronically mailed to the Division point ofcontact and each ofthe Assistant Attorney's General identified above by close ofbusiness April 

### IS , 2008. Any revisions to the prehearing statement must be submitted to the Administrator of the Commission at the preheaTing conference and by electronic mail to the Commission Office on the day ofthe prehearing conference. Any exhibit included in the preheaTing statements will be electronically mailed to individual Commissioners for review prior to the hearing, provided the party files electronic copies of such exhibit. Rebuttals to the prehearing statement may be submitted to the Commission Office and all other parties by close ofbusiness September 5, 2008. 

### EXCEPTIONS TO FILE DOCUMENTS BY ELECTRONIC MAIL The Commission ' s Procedural Rules provide for an exception to file documents by electronic mail. 

### Ifgranted an exception to electronic filing pursuant to the provisions of 1.3.8(3) ofthe Commissions Procedural Rules, the applicant for party status shall file an original and fifteen copies ofthe pre hearing statement in the Office ofthe Air Quality Control Commission, and shall also deliver copies to each other party, applicant for party status, the Assistant Attorneys General representing the Commission and Division, and the Division staff person for the proceedings, by electronic mail or as otherwise provided by the exception granted under Subsection 1.3.8(3), by that same day.

Page 3 of4

### STATUTORY AUTHORITY FO R T HE C OMMIS SIO N'S AC T I O NS : The Commission promulgates this regulation pursuant to the authority granted 

### in Sections 25-7- lOS(l)(c), C.R.S. (authority to adopt a prevention of significant deterioration program) ; 25-7- l09(l)(a) (authority to require the use of air pollution controls); 25
- 7-l09(2)(a) (authority to adopt emiss ion control regulations pertaining to visib le pollutants); 25-7-114.4(1) (authority to adopt rules for the administration of permits); and 25-7-1002 (authority to maintain a program that complies with the requirements of the federal act for prevention and remediation of significant deterioration of visibility in 

### class I federal areas). The rulemaking hearing will be conducted in accordance with sections 24-4-103 and 25-7-110, C.R.S., as amended , the Procedural Rules of the Commission and as otherwise stated in this notice. This list of statutory authority is not intended as an exhaustive list of the Commission's statutory authority to act in this matter. Dated this 20th day ofJune 2008 at Denver, Colorado

Page4 of4

### Regulation No . 3 , Section VI.D. l. VI.D . Fee Schedule VI.D.1. Annual and permit processing fees s hall be charged in accordance with and in the amounts specified in the provisions of Colorado Revised Statutes section 25-7- 114.7. Annual fees for regulated po llutants s hall be \17.97$22.90 . Annual fees for hazardous air pollutants shall be $ 119.96$152.90 .

### S tatement of Basi s, S p ecific Statutory Authority a nd P urp ose R EV IS I ONS TO PAR T A , SECTION 

### Vl. D . l . S EPTE MBE R 18 , 2008 THI S STATEMENT OF BASIS, SPEC IFIC STATUTORY AUTHORITY AND PURPOS E CO MPLIES WITH THE REQUIREM ENTS OF THE COLORADO ADMINISTRATIVE PROCEDURE ACT SECTIONS 24
- 4-1 03( 4), C.R.S. FOR NEW AND REVISED REGULATIONS. BASIS THE A IR QUALITY CONTROL COMMISSION HAS ADOPTED REVISIONS TO PART A, SECTION VI.D.l. IN ORDER TO INCREASE THE ANNUAL EM ISSION FEES CHARGED TO AIR POLLUTION SOURCES IN COLORADO COMMENCING IN 2008. THE REVI SED FEES ARE AT THE STATUTORY LIMIT SET BY SECTION 25
- 7
- 114.7 , C.R.S. THE PROPOSAL INCREASES FEES TO THE LEVELS ENACTED BY THE GENERAL ASSEMBLY , AND SIGNED BY THE GOV ERNOR , IN SB08-055 , REFLECTED IN SECTION 25-7- 114 .7, C.R.S. AS AMENDED. SPECIFIC STATUTORY AUT HORITY THE SPECIFI C STATUTORY AUTHORITY FOR THESE REVISIONS IS SET FORTH fN SECTIONS 25-7-114.7 OF THE COLORADO AIR POLLUTION PREVENTION AND CONTROL ACT ("ACT"), WHICH ALLOWS THE COMM ISSION TO SET ANNUAL EMISSION FEES F OR REG ULATED AND HAZARDOUS AIR POLLUTANTS. P URPOSE THE REV ISIONS TO PART A, SECTI ON VI.D.l. WERE ADOPTED TO PROVIDE NECESSARY REVENUE FOR EXISTlNG AND ANTICIPATED REVENUE SHORTFALLS, AND FUND ADDITIONAL LEGISLATIVELYAUTHORIZED FTE AND LEGISLATIVELY
- DIRECT ED AIR QUALIY MONITORING.

COLORADO AIR QUALITY CONTR OL COMM I SSION ADOPTED: SEPTEMB ER 18, 2008

Regulation No.3 Page 1

# Meeting Agenda where Pub lic Hearing Occurred and Notice published in the Legal Ads ofthe D enver Post

# STATE OF COLORADO Bill Ritter, Jr . , Governor James B. Martin, Execut ive Director COLORADO AIR QUALITY CONT ROL COMMISS ION http ://www.cdphe. state.co. us 4300 Cherry Creek Drive South OED
- OLRA
- AS Denver, Colorado 80246-1530 Phone (303) 692-31 00 Fax (303) 691-7702 TDD (303) 691-7700 C olorado Department of Public Health and Env ironment 

# Notice of Meeting and Agenda Air Quality Control Commission September 18, 2008 Colorado Department of P u blic Health & 

## Enviro nment 4300 C herry C reek Drive So uth, Sabin Room

Call to Order: Approval of 

### Minutes : Public Comment: Agenda Review : 

### Denver, Colorado 

## 9:00a.m.

Determination of a Quorum Review/ Approval of the August 21 & 22, 2008 meeting minutes of the Air Quality Control Commission. The public is invited to comment on any air pollution is sue n ot on the agenda. The Commission will not take action on is s ues discussed under this agenda item today; however, items may be scheduled for further di s cussion or action. The Commiss ion Admi nistrator will review the meeting agenda and discuss any proposed revisions to the agenda for the Commission's cons ider ation.RULEMAKING HEARING 

### l. 

### Regulation Number 3: Stationary Source Fees ( 1

0 minutes presentation, 15 minutes discussion) The Division will present to the Commission revisions to the annual emission fees for stationary sources based on 2008 Senate 

### Bill 055 that provided for an increase in the statutory limit ofthe fees. 

### 2. Regulation Number 15: Chlorofluorocarbon Annual Fees (1 0 minutes presentation, 10 minutes discussion) The Division will present to the Commission revised annual chlorofluorocarbon emission fees based on 2008 Senate 

### Bill 055 that provided for an increase in the statutory limit ofthe fees. PUBLIC HEARING 

### 3 . North Front Range Metropolitan Planning Organization (NFRMPO) and Denver Regional Council of Governments (DRCOG) Conformity (20 minutes presentation, 25 minutes discussion) The NFRMPO and DRCOG will present to the Commission its 8-Hour Ozone Conformity determination. DRCOG and NFRMPO will discuss how they have worked together to determine conformity of their Regional Transp ortation Plans and their Transportation Improvement program plans. · REQUEST FOR RULEMAKING HEARING
- DECEMBER 11, 2008 

### 4. Regulation Number 9: Prescribed Fire Program Fees (5 minutes presentation, 5 minutes discussion) The Division will request the Commission set a rulemaking hearing to consider proposed revisions to the rule to modify the cost ofthe smoke management program as well as the structure of assessing fees to significant users ofprescribed fire. The Division is also proposing to update emissions and permitting activity data to better define small users ofthe program and to make non-substantive typographical, grammatical and formatting revisions to the rule. 

### 5. Denver Metropolitan and North Front Range Area Ozone Action Plan (25 minutes presentation, 45 minutes discussion ) The Regional Air Quality Council, the North Front Range Transportation and Air Quality Planning Council and the Division will request the Commission set a rulemaking hearing to consider a proposed 8-hour ozone attainment plan and accompanying regulations; Regulation Numbers 3, 7 , 11 and the Ambient Standards Regulation, to revise the State Implementation Plan as well as state only regulatory requirements to reduce ozone precursor emissions and demonstrate compliance with the 8-hour ozone National Ambient Air Quality Standards and to address the September 2007 directive ofthe Governor to work toward attainment of the newly revised 8-hour ozone standard.

2

### 6. Regulation Numbers 3: Regional Haze BART (20 minutes presentation, 30 minutes discussion) The Division will request the Commission set a rulemaking hearing to ·consider regulations to codify the Division's BART determinations for CEMEX and the Martin Drake facility. The Regional Haze SIP Element will also be revised to document these BART determinations. BRIEFINGS, DISCUSSIONS AND REPORTS 

### 7. Front Range Ozone Update (20 minutes presentation, 20 minutes discussion) The Division will review the summertime ozone monitoring data and report on any exceedences or violations ofthe ozone standards . The Division will also review the historical data and project future values that will be needed to remain below the national standard in the coming summer season for 2009. 

### 8. Commissioner Informational Items Commissioners will discuss among themselves activities that they have participated in over the past month that they believe other Commissioners and/or members ofthe public may be interested in hearing about. 

### 9. Division Director's Report- Paul Tourangeau Monthly activities report 

### 10. Attorney General's Report- Jerry Goad Update of any recent court actions on air quality issues 

### 11. Administrator's Report
- Doug Lempke October meeting agenda items review Regulation Number 6 revised notice Adjourn



### 3,;,. -·- - Regul a tion No. 3, Part A, Section VJ.D.l., Annual Emission Fees Kirsten King Air J>ojtutlon Control Division



### Rationale for Increased Fees tr"' - - 1 +Increase fees to legislatively enacted levels (SB08-055) • Fund Legislatively-authorized mon itori ng

on Westem Slope , and elsewhere • Legislatively approved FTE, past and

current • Recover reduced federal grant-monies • Fees have not been adjusted In statute

since 2001



### .... , . 

### Proposed Revis io n

+Increase current fees to statutory limits • Increase fees for criteria pollutants from

$17.97 per ton to $22.90 per ton • Increase fees for hazardous air pollutants

from pollutants from $119.96 per ton to $152.90 per ton +Increase will apply to calendar year

2008 emissions

### Conclusion ";,-,

### -- +Increase in annual fees is necessary to

fund existing programs +Requested fees are statutory maximum +Recommend that the AQCC adopt the

fee revisions



### 2

### The Denver Newspaper Agency DENVER, CO PUBLISHER'S AFFIDAVIT 

### City and County of 

### Denver, STATE OF COLORADO, SS. Jean Birch • • • • .. • .. • • • .. • • • • • • • • • • • • • • • • • • • • • • • • • • • • • belna of lawful ••• and bolna ftrat duly •-m up011 oath, ctapo .. s ud says 1 

### Legal Advertising Reviewer That he/sho I s tho •••• • • ••••••••• , • ••• • ••• ••• •• • ••• • , • • •• • , • Of Tho Donvor Newspaper AtloftC)', publlahor of tho Denver Post and Rocky Mountain News, dall)' nowapapora of general Circulation published and prfntod In whole or I n part In Donvar , In tho Count)' of Donv or and State of Colorado, Dlld thot said -wspapor wu Prfor to and durfng all tho tlmo hereinafter m e n tioned duly qualified for tho publication of legal notices a n d actvortlsornonta with i n tho Moaning of an Act of tho Oonoral Assembly of tho State of Colorado, Approved Aprfl 7, 1821 , as amended and appro¥od March 30, 1 1231 Aftd as amended and approved March S, 1138, entitled •Aft Act Concomln1 Loaal Notl c oa, ActvortiHmonta and Publications and tha foH of prfntora and publlahora thereof, and to repool all acta and parts Of acta In conflict with tho provlalon of thle act• and amondmanta Tharetot

Tha t tho notice, of which tho annex ed I s • trua copy, wu published In Tho said newspaper t o wit: (datn of publication)



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# . . ... . . . ...... . . Notary Public. My commlaslon expires • • • • • laptombor I, 20ot • • , , , 

# RECEIVED AUG 1 

# 8 2008 Executive Oiredors 

## Office

# Procedural Documents ofthe Commission

- Agenda Item Control Sheet

- Memorandum ofNotice

- Economic Impact Analysis (initial and final)

### COLORADO AIR QUALITY CONTROL COMMISS I ON AGENDA ITEM CONTROL SHEET 

### Item Title : Proposed Revisions to Regulation No. 

### 3. Part A, Section VI.D .1. 

### Meeti ng date: __**=S= ep~:..:t** **~e=.:.m::.::b=e!-r ...:..;18:..~·-=2:..::0:..::::0=8** 

NON-H EARING ACTION S _Administrative _Briefing Policy Area Designations 

## .X. Adoption £Required 

### TYPES OF AC TI ON REQUES T FOR H E ARING

_ Public Rulemaking Informational



### RECOMMENDED ACTION _Approval 

### MOTI ON Attached 

### STATUTORY AUTHORITY HEARING 

## L Public Rulemaking Informational

Denial

_ Not applicable

General**Specific~** 

### EPA SUBMITTAL Is this issue considered a SIP revision? Yes X No



## --- Which SIP? Date of EPA submission deadline : ___ _

### ISSUE: The Colorado Department of Public Health and Environment, Air Pollution Control Division ("Division") requests that the Colorado Air Quality Control Commission ("Commission") revise the provisions of Regulation No . 3, Part A . Section VI.D.1. in order to raise the annual emission fees for criteria and hazardous air pollutants in accordance with the provisions of Section 25-7-114.7 . , C.R.S. commencing in 2008. The proposal incr eases fees to the levels enacted by the General Assembly, and signed by the Governor, in SB08-055, reflected in Section 25-7-114.7 , C.R.S . as amended. Pursuant to Regulation No. 3, Part A, Section VI.D.1. annual emission fees shall be charged in accordance with and in the amounts and limits specified in Section 25-7-114.7., C.R.S. This statutory provision provides, as recently amended, that annual emission fees for criteria pollutants shall be set at $22.90 per ton and the fee for hazardous air pollutants shall be set at $152.90 per ton. Type of Fee Current Fee Proposed Fee Criteria Pollutant Fee (per ton) $17 . 97 $22.90 Hazardous Pollutant Fee (per ton) $119.96 $152.90 The General Assembly established these fee increases because the p rior statutory fee levels, last adjusted in 2001, are now inadequate to support exi sting authorized expenditures to operate the program. In addition, the fee i ncreases will fund additional legislatively-authorized FTE , additional legislatively-directed air monitoring, and recover current and anti cipated federal grant reductions. Accordingly, the Division is requesting that the Commission modify Regulation No . 3, Part A, Section VI.D.1. so as to increase annual emission fees to match t h e statutory levels approved by legislature.ATTACHMENTS: 

### 1. Final Economic Impact Analysis 2 . Regulation No. 3 , Part A , Section VI.D . 1 . Proposed Rule 3. Statement of Basis and Purpose 4 . Presentation

SIGNATURES : 

### 1 .

# :t:fL~?f_ Preparer , Date 

### 2 . Date 

### 3. Date 

### 4 . Division Director Date
Revised: 8/1/08

## FAQs Air Pollution Fee Increase
1. History behind the Stationary Sources Fund and how it grew, became depleted and why it is going insolvent. The statutory fees from stationary sources for the APCD were last increased in FYO 1102. Since the fee increase in FY01 /02 several things ha ve impacted the revenue and costs for the APCD. The ongoing ozone control challenges required the division to re-examine possible sources of emissions ofvolatile organic compounds . During the analysis the division determined that the oil and gas industry had significant emissions that were adversely impacting Front Range ozone levels. Based on this analysis the division began inventorying and billing for these emissions. The additional funds from these oil and gas sources caused the APCD Stationary Sources Fund balance to exceed the statutory 16.5% limit, and the division reduced fees in FY03/04 to address the situation. Because ofcontinued ozone problems in the Denver metro area, the division entered into an Early Action Compact (EAC) with EPA, which resulted in placing emissio n co ntrol s on certain oil and gas sources. This significantly increased the division's workload for inspections and permitting, but in parallel the emissions controls on these sources also served to reduce the division's fee revenues. In addition, since 2006 the division has received several appropriation increases from the legislature, without corresponding revenue increases, and must request a funding increase to sustain the necessary staffing and work efforts endorsed by the legislature . With the increase in controls resulting in a significant reduction in billable emissions, and additional staffing and project costs, the division ' s long -term analysis shows the revenues and fund balance is insufficient to support the program. The following table summarizes the approved staffing and expenditure increases f o r the division, for which appropriate revenue is necessary from the proposed fee bill.

- - 

### 2006 Emergency Supplemental $192,360 . 00 

### 2007 Decision Item $373 , 000 . 00 2007 Budget Amendment $797,000 .00 Western Slope Monito ring $385 , 700 .00 

### 2. When were the air fees originally established? Several forms of emission and permit fees have been in existence for more than 25 years . The Title V Permit Fee program, for example, was e s tablished in 1991 after the Clean Air Act established the national program. The Title V permit fee program began collecting fees in the 1990s for permit processing for major stationary sources in the state. Construction permits issued to small sources are charged a fee based on hours spent in processing the permit. Annual emissions fees
- for s tandard criteria pollutants but also for Hazardous Air Pollutants
- are assessed for minor and major emissions sources , and have been part of a pre-1990 fee system for the Division.

### 3. What is the percen tage increa se p r oposed fo r the air fees? Th b h 

### fi d h d**~** 

### . 27 46o/< e mcrease etween t e current ees an t e rec ueste ees ts o. Fee Description · Current Statutory Requested Change in Percent Fee S tatutory Fee Fee C hange Criteria pollutant emissions fee per $17 . 97 $22 .90 $4.93 27.43% ton Hazardous Air Pollutant e missions $119.96 $152 .9 0 $32.94 27.46% fee per ton 

### 4. Is it possible to create a n ozone plan w ithout t he fee increase- mean ing do we need to f

u nd this progra m in ord er to imple me nt any S I P or ozo ne plan ? Why? It 

### is possible to create an ozone plan without increasing the fees, though creation of an ozone plan is not the purpose of the proposed fee increase. The fee increase is to maintain the solvency of the base program. For the ozone plan, the division has sub mitted an emergency supplemental to fund required ozone modeling, and this i s not part of the fee bill. The modeling is needed to create the plan . The ozo ne modeling is both a stationary source and mobile source problem and should not be funded solely out ofthe Station ary Sources Control Fund. The division has neither the spending authority nor revenue stream to support the work reflected in the emergency supplemental request. The work needed to develop the ozone attainment plan, referred to as the ozone sta te implementation plan, will be absorbed by the division with current staff, but development ofthat important plan could be impacte d ifthe base program ofthe division could not be funded. The basis for the fee bill is largely due to prior-authori zed resources and activities , and is not driven by the new ozone c hallenge faced by the state. 

### 5. Wh at wo u ld be th e r es p ons e to Xcel E nergy when it complain s t he pollution is oil and gas and they sh ou ld n ot have to p ay t h e f ees? First, emission fee rates are equal for all emissions sources, and are based on the impact of a so urc e on the air shed. Each source and source category pays its per ton emission fees based on the amount of pollution emitted, or emissions loading to the atmosphere . Air emissions fees are used to suppo rt the sta te ' s overall Stationary Sources Program- generally captured in the emissions fees
- and are thus spread proportionately across all sources that contribute to the emissions loading ofthe atmo s phere 

### in the state. Xcel is thus charged its proportionate share of fees as compared to any other emissions source in the state. Second, the largest emissions sources in the state enjoy a statutory cap on the amount of emissions from each facility against which the division may charge fees , and thus effectively pay less for their impact o n the air s hed. The utilities in the state are the only sources that are large enough to take advantage ofthis emissions volume cap for fees, and they have saved significant revenue over the years- and currently do so- by this effective cap on fee s. Third, the o il and gas sector is the second highest emitting source category , after the electric utility generators, and because emissions from those individual faci lities do not approach the emissions volume cap in statute , that sector does not en j oy t h e fee cost cap that the utilities do . Fourth, Colorado 's per ton emissions fee s are significantly lower than those charged by EPA , and wiJI remain lower even with the requested increase. EPA suggests approximately $39/ton for major sou rce emi ss ions fees. Fourth, the division has historically adjusted the fees when the fees coJiected run hi gher than the cost of the program . The division reduced fees in FY 03 /04 and saved Colorado sources approximately $4.5M.

### 6. What entities will be charged the air fee? Please provide specific examples. All stationary sources that e mit more than one to n in a non- attainment area or two tons in an attainment area pay fees. The spreadsheet provides some specific examples .

SFY06..07 Cu rrent C u rrent Number of Billed Sta tutory Requested SFY06.07 Statutory Requ.. t ed Sourea SSP Revenue Source Unlta Unlta Rate Um ltRete Rata Billed Rete Limit R ate Rata Total XCEL Cherokee Plant Criteria Feea 8 394 . 0 tons $1 3 . 54 $17 . 97 $22 . 9000 $ 113 655 $150 8<10 $192 223 (actual tona billed laa t HAP Feea 25 . 0 tons $90. 34 $1 19. 96 $ 152. 9000 $2 259 $2 999 $3 623 lYear) • Tota l $115 , 913 $ 153 839 $196 ,045 XCEL Valmont Plant Criteria Feea 3 563 . 0 tons $13 . 54 $17 . 97 $22 . 9000 $48 514 $64 367 $82 051 

# - HAP Fees 4 . 7 tons $90 . 34 $ 119. 96 $152 . 9000 $425 $564 $719 Totll l $411938 $64 950 $82 769 Suncor Plant Criteria Fees 3 , 593 . 0 tons $13 . 54 $17 . 97 $22 . 9000 $48649 $64 566 $82,280 HAP Fees 17 . 3 tons $90 . 34 $119 . 96 $1 52 . 9000 $1 563 $2 075 $2 645 Total $50 212 $66 642 $84 925 Coora Brewing V a lley Criteria F eea 585 .2 tons $ 13. 54 $17 . 97 $ 22 . 9000 $7 924 $10 516 $13 , 40 1 Plant HAP Fees 58 . 0 tons $90 .34 $119 . 96 $152 . 9000 $5 ,24 0 $6 958 $8 868 Total $1 3163 $17 ,4 74 $22,269 C riteria Feea 6 769 . 0 tons $ 1 3 . 54 $17 . 9 7 $22 . 9000 $91 653 $12 1 639 $155011 Petroleum HAP Fees 139. 0 tons $90 . 34 $ 1 19. 96 $ 152. 9000 $12 557 $16 874 $21 253 Development Corp. - Totlll $104 210 $138 314 $ 1 76,264 Con Unentll l Cleaners Criteria Feea tons $ 13. 54 $17 . 97 $22.9000 $0 $0 $0 I n Lulavllle HAP Fees 2 . 7 tona $90 . 34 $119 . 96 $152 . 9000 $243 $323 $411 Total $ 243 $323 $411**~o; urrent**  Statutory VI Requ.. ted Rate %Rata Revenue Change

$41 362 2 7. 43% $624 27 . 46% $42 206 $17 664 27. 43% $155 27 .48% $17 819 $17 713 27 .43% $570 27 . 48% $1 8 283 $2 885 27 .43% $ 1 911 27 .48% $4796 $ 33 371 27 . 43 % $4 579 27 . 46 % $37 950 $0 2 7. 43% $89 27 .48% $89 • This plant triggers statutory emissions cap for fees (for Nox and So2) (chargeable tons : Nox 4,000 tons out of 10,810; S02 4000 Ions out of 7 , 082 ; particulate matter 317 tons out 317· and VOC 

### n tons out of 77 . •• This plant does not trigger statutory caps for fees I l

... This is for the whole company. all souroeslfacilities I I 

### 7. 

### How do our Air Quality fees compare to other s tates? The following states responded to a survey oftheir fees . State Stationary Source s C riteria Pollutant Per Ton Fee Colorado Current sta tutory cap: $17 .97 Proposed sta tutory cap: $22.09 Wyoming $25.00 Utah $43.03 EPA tribal lands $40.52 South Dakota $6 . 10 Nebraska $38.00 Kansas $25.00 Texas $30.90 Oregon $38 .08 Arizona $13 .24 North Dakota $12.00 Montana $21.58 I I

Fee Emiss io n s Cal! (tons} 4 , 000 4,000 4 ,000 4,000 No Cap 1 4 , 000 4

L 000 4 , 000 4 , 000 No Cap No C ap No Ca p

1 These states have lower fees beca use there is no emissions fee cap. In other words , industry must pay for every ton e mitted (unlimited) rather than paying for each ton emi tted up to 4,000 tons. I l

### 8. Can you please differentiate between how much of the revenue (and associated fees) are for (a) insolve ncy; (b) climate change initiatives; and (c) lost federal funds? The estimated increase in revenues from the proposed fee increases would be approximately $1 ,75 6,235. (a) $1 , 512,001 to address program insolvency; (b) $84,418 for the climate change initiative; and (c) $159 , 816 for the loss of federal funds. 

### 9. Why did the federal government reduce a i r quality federal funds? There are many competing needs for federal resources. The available resource s for air pollution control available to EPA have been proposed fo r reduction 

### in recent Pr es idential budgets , and in 

### FFY2007 were reduced $319 ,63 1 for Colorado. The President 's budget does not describe with any specifics why these monies are reduced

### Date: To: S ub ject: MEM ORAND U M OF NOTICE May 12,2008 Interested Par ties P r oposed revis ions to the Air Q uality C ontrol Commission 's Reg ulat ion Number 3, Part A, Section VI . D.l. GENERAL DESCRIPTION The Colorado Department ofPublic Health and Environment, Air Pollution Control Division ("Division") re quests that the Colorado Air Quality Control Commission ("Commission") revise the provisions ofRegul ation No. 3, Part A, Section VI.D . l. in order to raise the annual emission fees for criteria and hazardous air pollutants in accordance with the provisions of Section 25-7-114.7., C.R.S. commencing 

### in 2008. The proposal increases fees to the [evels enacted by the General Assembly, and signed by the Governor, in SB08
-055, reflected in 

### Section 25-7-114.7 , C.R.S. as amended. 

### RULEMAKINGPACKAGE Attachments to this memorandum provide details o n the proposal as follows: • Attachment A: An initial economic impact analysis ofthe proposed revisions. • Attachment B: The actual language ofthe proposed revisions to Regulation No.3, Part A, Section VI.D.1. 

### EXPLANATION OF THE PR O P OSED REVISION Pursuant to Regulation No.3, Part A, Section VI.D.l. annual emission fees shall be charged in accordance with and in the amounts and limits specified in Section 25-7-114.7., C.R.S. This statutory provision provides that annual emission fees for criteria pollutants shall increase from $17.97 to $22.90 per ton and that the fee for hazardous air pollutants shall increase from $119.96 to $152 .90 per ton. The statu te further provides that ifthe amount ofmoney left in the Stationary Sources Control Fund at the end of a fiscal year exceeds the Target Reserve (24- 75-201), the fees shall be reduced so that the expected Target Rese· rve at the end ofthe next fiscal year. The statute also provides that after fees have been lowered in order the meet the Target Reserve requirements in a given year, fees may be raised in a subsequen t year so long as the expected Target Reserve for that year will not be exceeded. Due to a increased program costs from legislatively authorized FTE and other actions, and 

### to decreased federal grant revenue, the Division is currently operating under a shortfall 

### qn an annual basis. Additional revenue is necessary in the near future to cover all currently authorizedspending. Accordingly, the Division is requesti n g that the Commission modify Regulation No. 3, Part A, Section VI.D.l. so as to increase fees as shown in the following table: 

### Type of Fee Current Fee Proposed Fee Criteria Pollutant Fee (per $17.97 $22.90 

### too) Hazardous Pollutant Fee (per $119 . 96 $1 52.90 

### ton) MATERIALS TO BE INCORPORA TED BY REFERENCE There are no materials to be incorporated by reference in the proposed rule revision. 

### BACKGROUND ON DEVELOPMENT OF THE PROPOSED RULE What is the problem? The Division is currently operating under a shortfall. Additional revenue is needed to cover all currently-authorized spending . How would the proposed regulatory revisions help solve the problem(s) ? Th e proposed fee increase will generate appropriate revenue to fund the air program implement by the Division, as authorized by the legislature. How were the proposed revisions developed? The proposed new fee levels are based on an economic analysis ofthe amount of additional 

### funds necessary to support the program. How do the proposed rule revisions affect the p ublic, regulated community, and other agencies ? • The proposed revisions will increase annual emission fees for the regulated community. • The increase will fund additional Western slope and other air monitoring authorized by the legi s lature in the Long Bill. • Other government agencies will 

### be largely unaffected by the proposed rule revisions at this time. How do the proposed rule revisions relate to federal reguireme. nts or adjacent state requirements? The proposed rule revisions will not affect existing federal requirements . The revisions will not affect ot her states' regulatory status or obligation s. Th e following table provides examples of criteria pollutant fees from other western states.State S t ation ary Sou rces Criteria Fee Emissions Cap (tons) Pollu tant Per To n Fee Colorado Current statutory cap: $17.97 Proposed s tatut ory cap: $22.09 Wyoming $25.00 Utah $43.03 EPA tribal lands $40.52 South Dakota $6.10 Nebraska $38.00 Kansas $25.00 Texas $30.90 Oregon $38.08 Arizona $13.24 North Dakota $12.00 Montana $21.58


### How will the regulatory revisions be implemented ? The revisions will 

### be implemented through the Division's established emission fee billing process. Are there time constraints ? 4,000 4,000 4,000 4,000 NoCap 1 4,000 4,000 4,000 4,000 No Cap No Cap No Cap



### Expeditious consideration and approval of the requested fee increase is necessary to ensure the solvency ofthe Division. What if the Air Quality Co ntrol Commission does not adopt the proposed Rule revisions? If the Commission doe s not adopt the proposed rule revisions , the Division will not be able to fund the program. Program elements will not 

### be implemented, and/or vari ous backlogs will be created or will increase. 

### RANGE OF REGULATORY ALTERNAT I VES The Division has not proposed any alternative regulatory options. 

### NO-ACTION ANALYSIS If the Commission does not adopt the proposed rule revisions, the Division will not 

### be able to fund legislatively-directed activities, and would have to curtail existing programs to cover anticipated revenue shortfalls. 

### PUBLIC MEETINGS The Commission will hold a Rulemaking Hearing on the proposed rule . The Commission will establish a pre-hearing process to ensure an orderly hearing. Anyone may participate in the pre1 These states have lower fees because there is no emissions fee cap. In other words, industry must pay for every ton em itted (unlimited) rather than paying for each ton emitted up to 4,000 tons.

### hearing and hearing process by obtaining party status 

### in accordance with the Commission ' s Procedural Rules.CONTACT INFORMATION: For more information please contact: Kirsten King Manager Stationary Sources Program Air Pollution Control Division 4300 Cherry Creek Drive South Denver, CO 80246-1530 Phone: (303) 692-3178 Fax: (303) 782-5493 E
-mail: Kirsten.king@state.co.usSource 

### Initial Economic Impact Analysis of the Proposed Revisions to Regulation No.3, Part A, Section VI. D.l. INITIAL ECONOMIC IMPACT ANALYSIS Per C . R.S . 25-7-110.5 The Colorado Department ofPublic Health and Environment, Air Pollution Control Division ("Division") is proposing revisions to Regulation No. 3, Part A, Section VI.D.1. in order to raise the annual emission fees for criteria and hazardous air pollutants , in accordance with the provisions ofSection 25 -7-114 .7 . , C.R.S. The fee changes are 

### d 'I d . h fi 

### II . bl

eta1 e m t e o OWJng ta e. TypeofFee Current Fee Proposed Fee Criteria Pollutant Fee (per ton) $17 . 97 $22.90 Hazardous Pollutant Fee (per ton) $119.96 $152.90 Table 2 provides a selecti. on of sources and the impacts ofthe fee changes to those sources: Current C urrent Curren t Stat utory vs Number of Statutory Req uested Statutory Requested Requested Rllte**~p** Revnuc Source Uuits Uaits Limit Rate Rate Limit Rate Rate Total Revenue XCEL Cherokee Plant**~riteria** Fees 8,394.0tons Sl7 . 97 $22 .900C $150,840 Sl92,223 $41,382 (actu al to ns billed last year) 

### • HAP Fees 25 . 0tons $119 . 96 $152 . 9000 S2,999 S3,823 S824 Total $153,839 $196, 045 $42,206**~CEL** Valmont Plant Criteria Fees 3,583 .0tons $17 . 97 $22 .9000 $64 ,387 $82 ,051 $17,664 

# .. HAP Fees 4 .7tons S11 9 . 96 Sl52 .9000 $564 S719 $ISS Total**$64,95~** $82,769 $17,819 Sunco r Plant**riteria** Fees 3,593.0 tons Sl7 . 97 $22 .9000 $64,566 S82,280 $17,713 HAP Fees I7.3 tons $119 . 96 SIS2 . 9000 $2 ,075 $2,645 S570 Total $66,642 $84,925 $18,283 Coors Brewing Valley**~riteria** Fees 585.2 tons $17 . 97 $22 .9000 $10,516 Sl3 , 401 $2,885 Plant HAP Fees 58 . 0tons $11 9.96 $152.9000 $6,958 $8,868 Sl,91 I [Tota l $17 , 474**$22,26~** $4,7 96 !Petroleum jcriteria Fees 6,769 .0 tons $17 . 97 $22 . 900( $121 ,639 $155 ,0 11 $33,371 Development Corp. 

### ••• 

### !HAP Fees 139.0tons Sl19 . 96 S152 .9000 $16,674 $21,253 $4,579 Total $138,314 $176,264**$37,95~** Conti nental Clea11crs Criteria Fees tons $1 7.97 $22 . 9000 

### so so so In L uisvillc HAP Fees 2 .7 tons $11 9.96 $152 .9000 $323 $411 $89 rrotal $323 $411 $89 o/e Rate Cbaage 27 .43o/c 27.46o/c

27 .43o/c 27 .46o/c

27.43o/c 27.46o/c

27 .43o/c 27.46o/c

27.43o/c 27 .46o/c
27.43% 27 .46o/c

• This plant triggers statutory emissions cap for fees ( for NOx and S02) {chargeable tons : NOx 4,000 tons out of 10,810 ; S02 4,000 tons out of7,062 ; particulate maner 317 tons out of3 17; and VOC 77 tons ou t of77 •• This plant does not trigger satutory caps for fees ••• This is for the whole company, all sources/facili ties

### Based o n an analysis ofthe state's current emission inventory the proposed increase will 

### cost fee payers an additional $1.09 million per year. Broken down b y individual air pollution sources the estimated median increase will be $43.24 per year.So ur ce 

### Initial Economic Impact Analysis of th e Proposed Revisions to Regulation No.3, Part A, Section VI.D .l. Final ECONOMIC IMPACT ANALYSIS Per C . R.S . 25-7-110 . 5 

### The Colorado Department of Public Health and Env ir o nment, Air Pollution Control Divi s ion ("D ivision ") is proposing revisi ons to Regulation No. 3, Part A , Section VI.D.l. in order to raise the annual emission fee s for criteria and hazardous air pollutants, in accordance with the provisions of Section 25-7-114.7. , C.R.S. The fee changes are 

### d t 

### ' 1 d . th fi 

### 11 . t 

### bl

eat e 

### m e o owmg a e. Type of Fee Current Fee Proposed Fee Criteri a P o llut ant F ee (per t on ) $17.97 $22.90 Haza rdous P ollutant Fee (p er ton) $119.96 $152 .90 

### Ta ble 2 pr ovides a selection of sources and the impacts of the fee changes to those sources: Current C urrent Currtnt Statutory vs Number of Statut ory R equested Statutory Requ es ted Requested Rate· !ssP Re venue So ur ce U nits U nits Limit Rate Rate Li mit Rate Rate Total R evenu e XCEL Cherokee Plant**~ri teria**  Fees 8,3 94.0 tons $17.97 $22 .9000 $150,840 $192,223 $41,382 actual tons billed last year) 

### • HAP Fees 25.0tons $11 9 .96 $152 .9000 $2,999 $3,823 $824 [Total $153,839 $ 196,045**$42,20~** XCEL Valmont Plant**riteria** Fees 3,583.0tons $ 17. 97 $22 . 9000 $64,38/ $82,051 $17,664 

### •• HAP Fees 4 .7ton s $119 .96 $152.9000 $564 $719 $15 5 ;Total $64,950 $82,769 $17,8 19 Suncor P lant Criteria Fees 3,593.0 ton s $ 17.97 $22 .9000 $64,566 $82,280 $17 ,713 HAP Fees 17 .3 tons $ 1 19.96 $152 .9000 $2,075 $2,645 $570 Total $66,642 $84,925 $18,283 Coors Brewing Valley Criter ia Fees 585.2to n s $17 . 97 $22 . 9000 $10,5 16 $13 , 401 $2,885 Plant HAP Fees 58 . 0tons $119.96 $152 .9000 $6,958 $8, 868 $1,911 Total $17,474 $ 22,269 $4,7 96 Petroleum Criteria Fees 6,769.0tons $1 7.97 $22 .9000 $121 ,639 $155,011 $33 ,371 Development C orp. * ** HAP Fees 139.0tons $119 .96 $152 .9000 $16 ,674 $21.253 $4,579**~o tal**  $138,314 $ 176,264 $37,950**oo tioent** **al** Cleaners**riteria** Fees tons $17 . 97 $22.9000 

### so so so in Luisville !HAP Fees 2.7tons $1 19.96 $152 . 9000 $323 $411 $89 lfo tal $323 $411 $89 o/e Rate C hange 27.43o/o 27 .46o/o

27 .43o/o 27.46%

27 .43% 27.46%

27.43o/o 27 .46o/o

27 .43o/o 27 .46o/o

27 .43o/o 27.46o/o

• This plant triggers statutory emission s cap for fees (fo r NOx and S02) (chargeable tons : NOx 4 ,000 tons out of 1 0,8 1 0; S02 4,000 tons out of7.062; particu l ate matter 317 tons ou t of3 1 7; and VOC 77 tons out of77. •• This plant does n o t tri gger sa tutOJy caps for fees

... This is for the who l e company, all sour ces/faci liti esBased on an analysis ofthe state's current emission inventory the proposed increase will cost fee payers an additional $1.09 million per year. Broken down by individual air pollution sources the estimated median increase will be $43.24 per year.

# Parties Hearing Documents (this includes a list ofthe parties, the parties prehearing statements and rebuttal statements, and any orders 

## by the Commission) 

# No Parties to this Hearing

# EPA Comments No Comments

# Public CommentsC olorado S tone, Sand & G ra v el A ssocia t i o n



### Ms. Theresa L. 

### Martin Air Quality Control Commission CDPHE EDO-AQCC
-A5 4300 Cherry Creek Drive South Denver, CO 80246 Dear Ms. Martin: August 14, 2008

On behalf of the Colorado Stone, Sand & 

### Gravel Association (CSSGA), I would like to submit a few brief comments regarding the Stationary Source Permit Rulemaking Hearing on September 18 , 2008 . This rulemaking process is the result of the passage of Senate Bill #55 which Govemor Ritter signed earlier this year. I am planning to attend the Pre -Hearing conference on August 20 a t 9 AM. You should also know that a yet to be determined representative from one of our Producer Members will 

### make official comments, on behalf of CSSGA, during the September 20 hearing. Comments Senate Bill #55 was introduced and passed because the CDPHE is experiencing a back-log in processing permits due to the significant increase in permit applications from many industry sectors. Representatives from CDPHE met with members of CSSGA's Land, Use & 

### Environment Committee in mid-April of this year to discuss the merits of SB #55 and the pending 27% permit fee increase. As you can imagine, our membership which is comprised of aggregate producers had concems regarding the fee increase. The membership of CSSGA is very hopeful, that as a result of this 27% fee increase, the Department will 

### in-fact streamline the permit application process. The significant increase in oil and gas permit applications has undoubtedly slowed down the permit process for the aggregate industry . CSSGA understands and supports the Department's requirement of hiring new FI'E's to help overcome the back-log in permit processing. With the pending increase in FI'E's, the membership of CSSGA requests that the Department dedicated a specific percentage of the current and n e w FI'E's to processing aggregate industry permit applications. The 27% fee increase impacts 

### all of us and we hope to receive our fair share of dedicated permit writers for the aggregate industry. 1799 Pennsylvani a Street , S uite 240, Denver 7 CO 80201

### Ms. Theresa Martin Augustl4,2008 Page Two If you have any further questions or comments, please don't hesitate to contact me at your earliest convenience. Thank you.

cc: Kirsten King Jerry Goad William Allison Sincerely,
Pete Jacobson Managing Director

# Adopted Sta tement of Basis , Specific Statutory Authority and PurposeI.QQ. Adopted September 18, 2008 Revisions to Regulation Number 3, Part A This Statement of Basis , Specific Statutory Authority and Purpose complies with the requirements of the Colorado Administrative Procedures Act , § 24-4 - 103 (4 ), C . R.S ., for new and revised regulations . The Air Quality Contro l Comm i ssion has adopted revi sions to Part A , Section VI.D . 1 . i n orde r to i ncrease the annual em i ss i on fees charged to air pollution sources i n Colorado commenci ng in 2008 . The rev i sed fees are at the statuto ry l im it set by Section 25-7-114 . 7 , C . R.S . The proposal increases the fees to the levels enacted by the General Assembly , and signed by the Governor, in SB08 - 055 , re flected in Section 25-7-1 , 14 . 7 , C.R.S . as amended . Specific Statutory Authority The specific statutory authority for these revisions is set forth in Sections 25-7-114 . 7 o f the Colorado A i r Pollution Prevention and Control Act (" Acf) , which allows the Commission to set annual emissi on fees for regu l ated and hazardous air pollutants . Purpose The revisions to Part A , Section VI. 0 . 1 . were adopted to provide necessary revenue for exist ing and anti cipated revenue shortfalls , and fund additional legislatively-authorized FTE and legislatively-directed air qual i ty mon i tori ng .

# Adopted Language by 

# the Commiss ion

### DEPARTMENT OF PUBLIC HEALTH AND ENV I RONMENT Air Quality Control Commission REGULAT I ON NUMBER 3 STATIONARY SOURCE PERMITTING AND AIR POLLUTANT EM I SSION NOTICE REQUIREMENTS

PART A 

### 5 CCR 1001-5 C ON C ERNING GENERAL PROVISIONS APPLICABLE TO R EP O RT IN G AND PERMI TT ING VI.D . Fee Schedule VI.D.1 . Annual and permit processing fees shall be charged in accordance with and in the amounts and limits specified in the provisions of Colorado Rev ised Statutes Section 25-7- 114 . 7 . Annual fees for regulated pollutants shall**be ~-**  Annual fees for hazardous air pollutants shall be**$-1.~$152** 90 . VI.D.2. Air Pollutant Emission Notice filing fees shall be charged in accordance with and in the amounts and limits specified in the provisions of Colorado Revised Statutes Section 25-7- 114 .1 . PART G STAT EME NT S OF B ASIS , S PE C IFIC S TATUTOR Y AUTHORITY AN D PURP O SE I.QQ. Adopted September 18, 2008 Revisions to Regulation Number 3, Part A This Statement of Basis . Specific Statutory Authority and Purpose complies with the requirements of the Colorado Administrative Procedures Act.§ 24-4-103(4) . C.R.S. . for new and revised regulations.
The Air Quality Control CommiSSion has adopted revisions to Part A Section VI.D . 1 . in order to mcrease the annual emission fees charged to air pollution sources in Colorado commencing in 2008 . The revised fees are at the statutory limit set by Section 25-7-114 . 7 . C . R.S . The proposal increases the fees to the levels enacted by the General Assembly , and signed by the Governor. in SB08-055 . reflected in Section 25-7-114 . 7. C . R.S . as amended . Specific Statutory Authority The specific statutory authority for these revisions is set forth in Sections 25-7-114 . 7 of the Colorado Air Pollution Prevention and Control Act ("Act" ), which allows the Commission to set annual emission fees for regulated and hazardous air pollutants. Purpose The rev1s1ons to Part A Section VI.D.1 . were adopted to provide necessary revenue for existing and anticipated revenue shortfalls. and fund additional legislatively-authorized FTE and legislatively- directed air quality monitoring . Regulation Number 3, P a rt A Adopted 09/18/08 Page 1

# Final Adoption Notice

# STATE OF COLORA.DO Bill Ritter, Jr., Governor James B. Martin , E xecutive Director Dedicated to protecting and Imp roving the health and environment of the people of Colorado 4300 Cherry Creek Dr . S . Laboratory Services Division Denver, Colorado 80246-1530 8100 Lowry Blvd. Phone (303) 692-2000 Denver, Colorado 80230-6928 TOO Line (303) 691-7700 (303) 692-3090 Located in Glendale, Colorado http:f/www .cdphe.state .co.us NOTICE OF FINAL ADOPTION Col orado Department ofPublic Health and Environment PURSUANT to the provisions of sections 25-7-105, 25-7
- 105(12), 25-7-114 through 25-7-114.7,25-7- 106,25-7-119 and 25-7-132 C.R.S. ofthe Colorado Po ll ution Prevention and Control Act. NOTICE IS HEREBY GIVEN that after a public rulemaking hearing September 18, 2008, and in compliance with the requirements of sections 25-7-105, 25-7-110, and 25-7-110 . 5, C.R.S., the Colorado Air Quality Control Commission made revisions to: Regulation Number 3 Stationary Source Permitting and Air Po llutant Emission Notice Requirements The Comm ission adopted revision s to Regulation N umb er 3 Part A, Section VI.D.l. that would raise the a nnual emission fees for criteria and hazardous a ir po llutants in accordance with the provisions of Section 25-7-114.7. C.R.S. The proposed increase raises fees to the limit set by Colorado Legislature and would be used to fund legislatively app roved staffing increases to address permitting, oil and gas activities, and additional air quality monitoring. This action was submitted to the Secretary of State ' s Office within 20 days after adoption for publication in the Colorado Register, pursuant to 24-4-1 03(5) and (1l)(d), C.R.S., and will become effective October 30, 2008. Additionally, pursuant to 24-4-1 03(8)(d) , C.R.S., within 20 days after th e date ofthe Attorney General's Opinion, this action will be submitted to the Office of Legislative Legal Services for review. Dated this 25th day of September 2008 at Denver, Co l orado.

. Lempke, Administrator

# Op inion of the Attorney General

### AGOpinion

JOHN W. SUTHERS Attorney Ge n eral CYNTHIA H. COFFMAN Chief Deputy Attorney General DANIEL D. DOMENICO Solicitor General 

### STATE OF C OLORADO DEPARTMENT OF LAW OFFICE OF THE ATTORNEY GENERAL STATE SERVICES BUILDING 

### Page I of I

1525 Shennan S treet - 7th Floor Denver , Co lo rado 80203 P hone (303) 866-4500 Fax (303) 866-5691 Tr

acki ng Nu mber: 2008
- 006 04 OPINION OF THE ATTORNEY GENERAL RENDERED lN

CONNECTION WITH THE RULES ADOPTED BY THE Air Quality Control Commiss io n ON 09/ 18/2008

S CCR 1001 -S REGU LATION No .3 STATIONARY SOUR CE PERMITTING AND AIR POLLUTANT EMISSION NOTICE REQUIREMENTS The above-referenced rules were su bmitt ed to thi s office o n 09/25/2 008 as required by section 24-4-103, C.R.S. This office has reviewed them and finds no apparent constitutio nal or leg al deficiency in thei r form or substance. September 30,2008 09 : 46 :50 MST
JOHN W. SUTHERS Attorney Genera l by DANIEL D. DOMENICO Solicitor General



### http:/ /www .sos. state. co.us/CCR/Opinion.do?forview=true&trackingNum= 2008 -00604 9/30/2008

# Regulation as Published in the CCR (this is the version that is published by Lexis Nexis)

### EDITOR'S NOTES (continued) History and Amendments: Adopted 7/18/02, EFFECTIVE 9/30/02,25 CR 9. Adopted 10117/02, EFFECTIVE 12/30/02, 25 CR 12 . Regulation LA adopted 03/21/03, EFFECTIVE 04/30/03,26 CR 4 . Adopted 03/12/04, EFFECTIVE 05/30/04, 27 CR 5. Regu lation No.3 Adopted 04/16/04, EFFECTIVE 06/30/04, 27 CR 6. Part B adopted by technical correction, 27 CR 12 . Part A, Part 8, Part C, Part D, Part F adopted 12/ 16 /04, EFFECTIVE 03/02/05, 28 CR 2 . Parts A to F adopted 7/21/05, EFFECTIVE 10/02/05, 28 CR 9 . Pp 23-27, 35, 77, 1 11- 18 3, 283-285 adopted J 2/15/06, EFFECTIVE 03/02/06, 29 CR 2 . Regulation 3, Part B, Section Ill. C adopted by technical correction; Regulation 3, Part G adopted 03 / 16 /06, EFFECTIVE 05/30/06, 29 CR 5. Rule replaced in its entirety, adopted 08/17/06, EFFECTIVE 10/30/06, 29 CR 10. Rules Vl.D.I. and I.LL. adopted 12/15/06, EFFECTIVE 03/04/07,30 CR 2. Part A , Section LA. and Part D adopted by technical correction, 30 CR 6. Rules VI.D.l and I.MM adopted 10/18/07, EFFECTIVE 11/30/07,30 CR J 1. PartE Best Available Retrofit Technology (BART), Rules V.B, VI (entire section), l.NN adopted 12 /2 1/07 , EFFECTIVE 03/01/08,31 CR 2. Rul e r ep laced in its entirety, a dopted 02/21/08. EFFECTIVE 04/30/08, 31 CR 4. Part F, Sec tion IV .B, Part G, Section l.PP adopted 05/14/08, EFFECTIVE 06/30/08, 31 CR 6. Part A, Section Vl.D.I, Pa rt G, Section I.QQ adopted 09118/08, EFFECTIVE I 0/30/08, 31 CR 10.

A.G. Opinions: 25 AG 3 12; 25 AG 431; 26 AG 162; 27 AG 170; 27 AG 208; 28 AG 42; 28 AG 225; 29 AG 77-78; 29 AG 174; 29 AG Oct 1001-5; 30 AG F eb 1001 -5; 30 AG; 30 AG Nov 1001-5; 31 AG Feb 1001-5; 3 1 AG Apr 1001-5;31 AGJun 1001 -5;31 AGOct 1001-5

Annotations:

10 2008 Stale ofColorado Page 3 5 CCR 1001 -5 All Rights Reserved. (800) 833-9844