STATE OF TENNESSEE DEPART~~~JIC& ~TV&OP~L~EL~RDc~~YZEFVATION 9TH FLOOR L&C ANNEX" 40 1 CHURCH 

### STREET NASHVILLE, TENNESSEE 37243-1531

March 28,2012

Ms. Gwen Keyes Fleming EPA Regional Administrator,Region 

### TV United StatesEnvironmental ProtectionAgency 

### Atlanta 

### Federal Center 61ForqdhStreet,SW Atlank GA 30303-3 

### 1 Q4

Dear Ms. Fleming:

This letter isbeing sent in response to the concerns ofEPA relative to the Tennessee ozone infrastructure SIP and the requirements of section 11 0 (a) (2) 

### (E) (ii) of the Clean Air Act as an element of the state's 

### SIP. More specifically, 110 (a) (2XEXii) relates to the state's meeting requirements of section 128 ofthe Clean Air Act for the structure of its board having jurisdiction for administrative review of permits and enforcement actions. EPA's preliminary review of the Tennessee SIP suggests there a concern as to whether the State's SIP meets certain requirements pertaining to state boards from Section 128, because two ofthe provisions of subsection (a) (1) of section 128

### are not adequately addressed. Section 128 reads as follows (underlining added): 

### 5 7428. STATE

### BOARDS (a) LLI Not later than the date one year after August 7,1977, each applicable implementationplan shall contain requirementsthat- 

### (1) any board orbody which approves permits or enforcementorders under this chapter shall have at least a maioritv ofmembers whorepresentthe public interest and do not derive 

### any simificant portion oftheir income from persons subjectto permits or enforcementordersunder this chapter, and (2) 

### any potential conflictsof interestby members of such board or body or the head of an executive agency with similarpowers be adequately disclosed. (Notethis provision is addressedby state rule chapter 1200-3-17,efectiveat state level andapprovedto the 

### SIP.) EPA is under a legal deadlinetoMs. Fleming March 28,2012 Page 2

propose action on ozone infhstructure SIPSby March 30,2012 and 

### has declaredthat absent a commitment to resolve the concerns, it will be unable to approve Tennessee's ozone infrastructure 

### SIP with respectto element 1lO(a)(2)(E)(ii) and any subsequent infrastructure 

### SIP submittal respecting this sub-element.
Tennessee asserts that the structureof its state air pollution control board 

### as created by statute currently codified at Tenn. Code Ann. 

### 5 68-201-104 does meet the majority "public interest" requirements on closer analysis. Tennessee's statute creates sets of qualifications for positions on the board to be filled by gubernatorial appointment. And a majority of the positions can only be filled with individualswho would be in the State's view serving the '@blic interest" representatives. Moreover, several of these positions would also be filled by individuals who would by virtue of their position not derive significant income from regulated sources of air pollution. Otherswould be public elected officials or faculty at a public or private college or university, who 

### - while technically receiving a salary hm a local government or 

### an institution that would be "subject to permits or enforcementorders" 

## - should not be considered as biased 

### as a result of receiving such salary in their capacityto fairly hear appeals. Nevertheless, concerns remain
asto whether the categories for positions as defined in the statute adequately fulfill the requirements of 

## 5 128(a)(l). 

### An option exists for a conditional approval of the Tennessee ozone infrastructure SIP if a Tennessee submits a commitment letter to EPA that will timely rectify the concern prior to its 

### March 30, 2012 deadline for action. Timely in this casewould be within one 

### year ofEPA's 

### final approval of a conditional approval for infrastructure sub-element 1lO(a)(2)(E)(ii),. Tennessee is committing to establish requirements in law under various options- administrativerulemaking, statutory amendment, executive order, or a combination of methods 

# - to bring its 

### SIP into conformity with the requirements of 

## 5 128 of the Clean Air Act. 

### In orderto effectuatethis commitment, Tennessee would take the following actions: 1) Tennessee would designate at least 

### a majority of positions of the current structure of the air pollution control board as meeting the requirement of serving 

### in the "public interest" under the state's understandingofthis term. 

### 2) Tennessee would also establish requirements to ensure that at least a majority of board members "do not derive any significant portion of personal income from persons subject to permits or enforcementorders" based on the state's view ofthe applicability ofthisterm. a) Action 2 would be subject 

### to exceptions for mayors of counties and municipalities to not be disqualified tiom appointment and service 

### as members ofits air pollution control board based on the income from a salary paid by the local government for which they were primarily employed. Although such local elected officials would work for "persons" which are "subject to" permits or enforcement in the strictest sense, Tennessee feels as a matter of its public policy that these board members would be accountable to the electorate and theMs. Fleming March 28,2012 

### Page 3

primary Eunctions of the local government 

### are not connected to any air pollution regulated activities. b) Action 2 would also be subject to exceptions for faculty members at an institution of higher learning to not be disqualified fiom appointment and service on the board based on income from a salary paid by the institution at which they 

### are primarily employed. The State feels that the payment of a salary by an academic institution should not eliminate the ability of such a board member to participate in hearing appeals of permits and enforcement actions. The primary purpose of the institution of higher learning is not connected to activities regulated under 

### air pollution control statutes and rules, although operation of facilities at such institution would lead incidentally to activity which could require a permit or could result in enforcement actions. Possible examples would be boilers to provide steam for campus building having permits or asbestos NESHAP compliance issues 

### in demotion or renovation
on campus. 

# '

In consideration of the above discussion, the state of Tennessee formally commits to revise its SIP to address the concerns of EPA 

### and to complete legal changes at state level and submit these changes to EPA for approval to the SIP. Such actions would occur on a timeline which would allow EPA action to adopt these changes 

### to the SIP no later than one year from the effective date of EPA's regulation to conditionally approve the Tennessee infrastructure SIP. And this timeline could require parallel processing ofregulatory changes,which would be coordinated with EPA.
if you should have further questions, please contact me or Quincy Styke at (615)-532-0525 or (615)-532- 0562.

Director Division ofAir Pollution Control Copies to: Robert Martineau 

## ,Commissioner; Joe 

### Sanders, General Counsel Division ofAir Pollution Control, Central Files

Pert ofthe needforthese exceptionsin 2(a) and (b) are driven by anunderstandingof "subject to" as meaningboth potential and actual issues. 1200-3-17 alreadyhas conflict-of-interest pmvisionswhich would operateto disqualifyaboard member 6om serving ifaparticular case involvedhidherparticularinstitution or government. So, thisis aseparateissue.