Staff Report for Board Adoption Hearing, April 24, 2014 

STAFF REPORT 

For Board Adoption Hearing 

Rule 101-Definitions

Rule 400-Permit Requirements

Rule 401-Permit Exemptions 

Rule 432-Federal New Source Review 

Rule 433-Rice Straw Emission Reduction Credits

Proposed Amended Rules Release Date: March 25, 2014

Schedule of Meetings 

• Date of Public Workshop on Proposed Amended Rules: 

• 2:00 p.m., Thursday, April 3, 2014, District Office, 629 Entler Avenue, Suite 15, 

Chico, CA 

Schedule of Hearing 

• Date of Board Adoption Hearing: 

• 10:00 a.m., Thursday, April 24, 2014, City of Oroville Council Chambers, 1735 

Montgomery Street, Oroville, CA 

Note: The Staff Report has been revised from the report released on March 25, 2014 

to further address SIP related concerns. 

 
2 

Staff Report For Board Adoption Hearing April 24, 2014 

Proposed Amended Rules for SIP Submittal 

 

STAFF REPORT 

For Board Adoption Hearing

Rule 101-Definitions

Rule 400-Permit Requirements

Rule 401-Permit Exemptions

Rule 432-Federal New Source Review 

Rule 433-Rice Straw Emission Reduction Credits

Proposed Amended Rules Release Date: March 25, 2014

Public Adoption Hearing: April 24, 2014 at 10:00 a.m. 

City of Oroville Council Chambers 

1735 Montgomery Street, Oroville, CA 

Contents Page 

Executive Summary ...................................................... 3 

1. Program Purpose ...................................................... 3 

2. Applicability ....................................................... 3 

3. Discussion ....................................................... 3 

4. Requirements ....................................................... 5 

5. Cost Impacts/Cost Effectiveness................................................ 13 

6. Alternatives ....................................................... 13 

7. Environmental Review ...................................................... 14 

8. Required Findings ........................................................ 14 

9. Attachments 

Attachment A Rule 100-Defintions (Proposed Amendments)

Attachment B Rule 400-Permit Requirements (Proposed Amendments) 

Attachment C Rule 401-Permit Exemptions (Proposed Amendments)

Attachment D Rule 432-Federal New Source Review (Proposed Amendments) 

Attachment E Rule 433-Rice Straw Emission Reduction Credits (Proposed 

Amendments) 

Attachment F Notice of Public Workshop and Hearing 

Attachment G Draft Resolution of Adoption 
3 

Staff Report For Board Adoption Hearing April 24, 2014 

Proposed Amended Rules for SIP Submittal 

 

STAFF REPORT

Executive Summary 

The Butte County Air Quality Management District (District) proposes to amend existing 

permitting rules to ensure the rules include all the requirements for permitting minor and major 

sources for State and federal purposes to comply with the federal Clean Air Act requirements for 

new source review (NSR). Since only those requirements of federal law are required to be 

submitted as a revision to the State Implementation Plant (SIP), the District re-codified 

Regulation IV—Permits in May 2011 and included all minor and major administrative federal 

requirements into one rule, developed a separate rule for permit exemptions, and split the State 

and federal NSR requirements into two rules. Based on feedback from the U.S. Environmental 

Protection Agency (EPA), the District is proposing amendments to clarify and refine District five 

rules setting forth the definitions, the permitting requirements, and rice straw ERC banking 

implementation for SIP submittal to meet the original objectives. 

This Staff Report will include applicable references from the re-codification Staff Report in May 

2011 to document and demonstrate compliance with applicable federal requirements although 

some of those provisions are not modified in these amendments. 

1.0 PURPOSE 

To amend Regulation IV-PERMITS to prepare the rules for submittal in the District’s State 

Implementation Plan. 

2.0 APPLICABILITY 

Rule 101-Definitions sets forth definitions for all District Rules and Regulations unless a more 

specific definition is included in a rule or regulation. The proposed amended Rule 400-Permit 

Requirements is applicable to all sources that emit or may emit air contaminants as the rules 

address the existing permitting application, review, and issuance requirements The proposed 

amended Rule 401-Permit Exemptions sets thresholds for those sources that may emit less than 

significant emissions and be exempt from permitting requirements. Proposed amended Rule 432-

Federal New Source Review is applicable to major sources and major modifications for 

implementing federal requirements. Proposed amended Rule 433-Rice Straw Emission 

Reduction Credits implements the procedures and requirements for issuing ERCs from the 

reduction in burning rice straw and was applicable to those growers who grew and burned rice 

straw during the baseline period (early 1990s). 
4 

Staff Report For Board Adoption Hearing April 24, 2014 

Proposed Amended Rules for SIP Submittal 

 

3.0 DISCUSSION 

Background: 

The District’s New Source Review (NSR) program was established in its current form in 

January 1993 to ensure that the construction and operation of new and modified stationary 

sources do not interfere with progress towards attainment of the National and State Ambient 

Air Quality Standards. Because the District has been designated as nonattainment for failure 

to meet the federal 8-hour ground-level ozone standard and because portions of the District 

had been designated as nonattainment for failure to meet the 24- hour particulate matter less 

than 2.5 microns in diameter (PM2.5) standard (now meeting standards as demonstrated by 

a Clean Data Finding), the EPA requires the District to implement measures to reduce 

sources of ozone and PM2.5 and their precursors. The District makes its commitment to 

reduce pollution through the State Implementation Plan (SIP). The SIP is federally 

enforceable through EPA and the federal Clean Air Act. A New Source Review, or 

Preconstruction Review program, is required as part of the SIP. The purpose of the proposed 

amended Rule 400 is to set forth the requirements to for a source to apply for and obtain a 

permit through approval by the Air Pollution Control Officer. Rule 430-State New Source 

Review was amended in May 2011 to clarify the minor source NSR requirements and 

incorporate State permitting requirements. No additional changes are proposed to Rule 430. 

The table below summarizes the District’s State and Federal attainment designations: 

Pollutant State Federal 

1 hour Ozone Non-Attainment - 

8 hour Ozone Non-Attainment Non-Attainment 

Carbon Monoxide Attainment Attainment 

Nitrogen Dioxide Attainment Attainment 

Sulfur Dioxide Attainment Attainment 

Inhalable Particulate (PM10) Non-Attainment Attainment 

Inhalable Particulate (PM2.5) Non-Attainment Non-Attainment 

In 2011, the District proposed a bifurcated approach for permitting minor and major sources 

for State and federal purposes to comply with the federal Clean Air Act requirements for 

permitting. Only those requirements of federal law are required to be submitted as a revision to 

the SIP; therefore, Rule 432- Federal New Source Review, was adopted to be submitted as a SIP 

revision that contains the requirements necessary to satisfy federal laws and regulations for NSR. 

The amended Rule 432 did not contain provisions required by more stringent State laws. As 

discussed below, the District does not have a NSR rule in the current federally-approved SIP and 

therefore is not subject to California’s SB288 requirements.

During the evaluation of the existing rules in 2011, the District recognized a need to 

combine administrative application and permit requirements from the various rules into one 

rule and set forth exemptions from permit requirements in separate rules. As a result, Rule 

400 now contains the administrative requirements for minor and major sources to obtain 

permits. 
5 

Staff Report For Board Adoption Hearing April 24, 2014 

Proposed Amended Rules for SIP Submittal 

 

The District submitted the May 2011 new and amended rules to EPA for SIP approval in 

2013. During its initial review, EPA has identified portions of the rules that would require 

clarification or specific federal requirements to be added to the rules. In lieu of accepting 

limited approval of the submitted rules and correcting them at a later date, the District is 

proposing to amend the existing rules to include the necessary elements and re-submit the 

rules for approval. 

Protect California Air Act of 2003 (SB 288) 

In September, 2003, the California legislature passed SB 288, which ostensibly prevents the 

weakening of State NSR rules. Health & Safety Code Section 42504 now states that no air 

district "may amend or revise its new source review rules or regulations to be less stringent than 

those that existed on December 30, 2002." This baseline is defined as "district rules that the 

district has adopted as of December 30, 2002; that the ARB submitted to the EPA for 

inclusion in the SIP; and that have been approved, or are pending approval by the EPA". 

This baseline does not apply to the District since the NSR rule in effect in 2002 had not been 

submitted to the EPA for inclusion in the SIP, had never been approved and was not pending 

approval. The current version of the District’s NSR rule was submitted for inclusion in the 

SIP in May 1993 but was withdrawn in December 1994. The provisions of the District’s 

NSR rule that was previously in the SIP were contained in Rules 4.3, 4.5A, 4.5B, 4-6, 4-6A, 

4.9 and 4-11, which were rescinded by EPA action on May 2, 2001 as published in the 

Federal Register. The reason for this EPA action is unclear. The proposed amended NSR 

rules are not subject to SB288 restrictions for the above reasons. 

4.0 REQUIREMENTS 

Clean Air Act General Requirements 

The District was designated “non-attainment” for the federal PM2.5 NAAQS on December 

14, 2009. Based on the 2010-2012 monitoring data, the District demonstrated meeting it is 

the PM2.5 NAAQS and submitted a Clean Data Finding for PM2.5 in 2013. EPA reviewed 

this submittal and, on October 10, 2013, determined the District had attained and continues 

to attain the PM2.5 NAAQS. As a result, no PM2.5 plan is currently required; however, the 

District was required to submit a PM2.5 emissions inventory and a nonattainment NSR 

program applicable to PM2.5. The submitted inventory included banked PM2.5 emission 

reduction credits to be used for future offsets. 

The District is also “non-attainment” for the 2006 8-hour Ozone NAAQS and will be 

submitting an emissions inventory that includes the sources of ozone precursors in Butte 

County as well as include existing, banked emission reduction credits for the criteria 

pollutants that may contribute to the formation of ozone. 

Omitting VOC and NH3 as PM2.5 precursors in Rule 432: EPA has determined that there 

are 4 potential precursors to PM2.5 emissions: Oxides of Sulfur (SO2), Oxides of Nitrogen 

(NOx), Volatile Organic Compounds (VOC) and Ammonia (NH3). Accordingly, Rule 432 
6 

Staff Report For Board Adoption Hearing April 24, 2014 

Proposed Amended Rules for SIP Submittal 

 

includes SO2 and NOx as PM2.5 precursors, but does not include VOC and NH3 as 

precursors to PM2.5 formation because the District believes these pollutants are small 

contributors and has obtained a Clean Data Finding. The District’s Winter PM2.5 emissions 

inventory shows that emissions from mobile sources account for about 40 % of the District’s 

VOC emissions and about 5% of the NH3 emissions. Consumer products contribute about 

25% of the total VOC emissions. Farming/agricultural operations 

(fertilizer/livestock/composting) account for almost 90% of the NH3 inventory. These 

sources are not regulated as stationary sources requiring permits and the contributions from 

those sources that are permitted are insignificant. In preliminary evaluation for the 

anticipated PM2.5 SIP submittal, ARB staff had determined high PM2.5 values occur 

exclusively under stagnant winter conditions leading to accumulation of primary pollutants and 

formation of secondary components. While carbonaceous aerosols are primarily directly emitted 

into the air, nitrates are secondary pollutants formed in the atmosphere from gaseous NOx 

emissions and ammonia. ARB's programs aimed at reducing NOx emissions have played an 

important role in reducing the nitrate fraction of PM2.5. Long term nitrate and NOx data 

collected throughout the State demonstrate that reductions in ambient NOx concentrations have 

resulted in commensurate reductions in PM2.5 nitrate concentrations. Past modeling and 

monitoring studies in northern and central California highlight that reductions in VOCs are not 

important for reducing either carbonaceous aerosols or nitrate; therefore, they would not provide 

any benefit in reducing PM2.5 concentrations. Based on the nature of the PM2.5 problem and an 

understanding of precursor effectiveness, as well as the fact that the area has already attained the 

standard, VOCs and ammonia are therefore not significant PM2.5 precursors.

Summary of Significant Changes for Each Rule: 

Below are brief summaries of the changes for each of the five rules subject to this review: 

Rule 100-Definitions 

The District’s definitions rule currently in the SIP is Rule 102 which was adopted in 1985 

and accepted into the SIP in February, 1987 (52 FR 3226). The District has amended the 

Definitions Rule twelve times since this adoption. The District also recodified the 

Definitions rule and renumbered it from Rule 102 to Rule 101. Since many District rules in 

the SIP rely on these definitions, the District is proposing to amend this rule to organize and 

update the definitions. 

Several of the definitions are out of alphabetical order. These definitions have been moved 

without edits unless noted in this Staff Report. Several definitions have been updated for 

completeness including PM10 and P2.5 which now include gaseous pollutants. The Table 

for greenhouse gases warming potentials has been updated to revise the warming potentials 

for 23 gases as updated by EPA in 2013. 

Rule 400-Permit Requirements

The District combined the administrative permit application and review procedures found in the 

existing rules (400, 401 and 430) into one new Rule 400 in May 2011. EPA’s preliminary 

comments identify several areas that require clarification, inclusion or transferring administrative 
7 

Staff Report For Board Adoption Hearing April 24, 2014 

Proposed Amended Rules for SIP Submittal 

 

requirements or program requirements to or from Rule 432 (i.e. moving generic modeling 

requirements from Rule 432 to Rule 400 or moving specific major source requirements from 

Rule 400 to Rule 432). 

Proposed amendments to Rule 400 include the following (explanations are provided as 

necessary): 

• Generally, remove requirements found in or unnecessary references to other District rules 

that are not in nor will be submitted into the SIP (i.e. Rule 430-State New Source 

Review. Any removed requirements are either not required by the CAA or have been 

incorporated into Rule 400 without directing to requirements in a non-SIP rule. 

• Generally, EPA staff has commented that terms, such as “stationary source” and 

“emissions unit”, are not used consistently and are corrected to be consistent. 

• In definitions, “Initial Start-up” has been included to clarify this term for certain 

requirements. Similarly, the term “Start-up” has been clarified to include controls, 

instrumentation or other activities required or authorized by a permit. 

• Section 4 includes the standards for approving or denying an application, such as: any 

potential source of air contaminants must obtain an Authority to Construct; the source 

must meet all applicable rules and regulations; requirements for notifying an applicant 

whose application has been denied; and provisions to ensure compliance with Health and 

Safety Code requirements related to toxic air contaminant (Note: toxic section is not 

included in SIP submittal). An amendment to this section clarifies that have a potential to 

emit emissions at 25 tons or greater (the State NSR offset threshold) are subject to public 

notice to allow the public the ability to comment and requests a hearing prior to approval 

of the ATC permit (more details on this amendment are discussed below). This section 

also includes provisions for the Air Pollution Control Officer (APCO) to request 

information to assess the nature and extent of emissions, provisions to have a Permit to 

Operate for an emissions unit, the procedures for renewing a Permit to Operate including 

the review of existing conditions to ensure compliance with current applicable 

requirements. This section includes a mechanism to transfer the ownership of a permit. In 

response to EPA preliminary comments, Section 4.7 is being amended to clearly indicate 

that relocating permitted equipment or processes to another site requires a new permit 

and the original permit cannot be transferred. Section 4.9 and 4.10 contain requirements 

to provide monitoring and sampling stations as required by permit conditions and 

demonstration of compliance with permit emission limits by source performance testing 

an emissions unit when required by the APCO. These sections include proposed 

amendments to simplify the requirements to include the basic elements required. Details 

of sampling and source testing requirements for specific sources and emissions units are 

included in the District’s permits. Requirements for conducting an Air Quality Impact 

Analysis have been moved from Rule 432 into Rule 400 as Section 4.11 since this 

requirement may be applicable to any source applying for a permit. Section 4.4.7 

requires compliance with the State’s toxics notification regulation and is not intended for 

SIP submittal since this is a state only requirement. Section 4.12 includes an 

indemnification clause in which the applicant agrees to indemnify and hold harmless the 

APCO and District for actions relating to permit requirements. The indemnification 

clause will not be included in the submittal to the federal SIP. 
8 

Staff Report For Board Adoption Hearing April 24, 2014 

Proposed Amended Rules for SIP Submittal 

 

• Section 5 includes administrative requirements that allow for the receipt and processing 

of applications including time schedules for review and response, requirements to pay 

fees in accordance with District rules, various steps in reviewing the application 

including a completeness determination, the APCO preliminary decision, and procedures 

for denying or approving an application and issuing a permit. The proposed amendments 

include a requirement for the APCO to consider all comments received in response to 

public notice for an application prior to issuing the permit. This section also contains 

administrative requirements for permits after issuance including restrictions on defacing 

the permit, requirements to maintain the permit at the site, procedures for the APCO to 

suspend, cancel, or recommend revocation of a permit, and procedures for an applicant or 

aggrieved party to appeal an APCO determination which are not required by the CAA 

and are not being submitted for SIP approval. 

• Section 6 includes requirements and standards for monitoring and source testing 

methodologies and recordkeeping requirements to demonstrate compliance with permit 

conditions and all applicable requirements. The proposed amendments to this section 

clarify monitoring requirements and eliminate the Section 6.3.1 related to Emissions 

Statements as this requirement was adopted under Rule 434—Emissions Statements and 

submitted for SIP approval. 

Public Notice Threshold Determination:

The District proposes a 25 ton per year per pollutant Potential to Emit threshold for public 

notice. This is only applicable to pollutants that have an AAQS. This has traditionally been the 

threshold required for public notification for sources needing offsets for State permitting 

purposes. The District understands that public notice thresholds should notify the public for 

permitting actions that may impact efforts to attain NAAQSs. Since, the District’s primary cause 

for ozone nonattainment is from transport from the Sacramento and Bay Area metropolitan areas, 

the District proposes to maintain the public notice threshold at 25 TPY. This is consistent with 

the neighboring air districts in the Sacramento Valley with similar air quality. The District also 

reviewed the 2012 inventory to determine the impact of this threshold on permitted emission. 

The District notes that 469 facilities are permitted and, of these, 405 have total actual emissions 

less than two (2) tons per year. Based on evaluation of the source greater than 2 tons per year 

inventory, this proposed threshold will ensure that sources that account for 69 % of Reactive 

Organic Compound emissions and 82% of Oxide of Nitrogen emissions are subject to public 

notice. For PM10 and PM2.5, the percentage of these emissions subject to public notice would 

be about 25%. This percentage is smaller as the District has many smaller, seasonal agricultural 

sources, such as almond hullers and rice storage and drying facilities that contribute to the 

District total PM inventory, but individually are not significant. The District has determined that 

the primary contributor for the previous PM2.5 nonattainment designation was from winter 

residential combustion of wood fired devices, not stationary sources. 

Rule 401-Permit Exemptions 

In May 2011, the District adopted new Rule 401 identifying insignificant sources that are exempt 

from requiring a permit. The District is proposing minor amendments to this section to remove 
9 

Staff Report For Board Adoption Hearing April 24, 2014 

Proposed Amended Rules for SIP Submittal 

 

references to rules not included in the SIP, to clarify exemption parameters, and streamline 

exemption for sources emitting less than 2 pounds per day of criteria pollutants. 

The proposed amended rule will replace the existing Rule 4-4 currently in the SIP. The proposed 

amended rule is more prescriptive and identifies the types and sizes of equipment that will be 

exempt from permitting requirements. Rule 4-4 includes exemptions for vehicles, residential 

equipment, heating, air, ventilation, and refrigeration equipment, internal combustion engines, 

cooling towers, steam cleaners, extrusion presses, space heaters, food preparation equipment, 

natural gas or LPG heated steam, mobile construction equipment, agricultural equipment and 

“other sources of minor significance”. The proposed rule clarifies the existing “exemptions” and 

expands on the list based on past APCO evaluations and determinations of the equipment as 

“sources of minor significance”. As a general rule, the limits are to approximate the California 

air districts generally recognized exemption threshold of 2 lb/day of any regulated pollutant. 

The proposed amended rule continues to specify that a permit application is not required for the 

source categories listed in the rule unless a specific determination by the APCO is required. In 

addition, the APCO is granted authority to request information from the person claiming an 

exemption to verify the source meets the exemption criteria. 

Rule 401 provides that an emissions unit would not be eligible for exemption if: 

• The APCO determines the source needs a permit; 

• The source has actual emissions that exceed the Best Available Control Technology 

thresholds set in Rule 430-State New Source Review; however, the proposed amendment 

removes this reference and includes the actual threshold values to eliminate the reference 

to Rule 430 which is not being submitted into the SIP;

• The Title V permit program requires a source to obtain a permit; 

• The source is subject to the New National Emissions Standards for Hazardous Air 

Pollutants (NESHAP) or the New Source Performance Standards (NSPS), except for 

internal combustion engines rated at less than 50 horsepower which are subject to an 

NSPS but will continue to not require a District permit; or 

• The APCO determines the source is a significant source of toxic emissions. 

The following source categories are included for exemptions subject to the thresholds and 

limitations in the rule: 

• Combustion and heat transfer sources including steam cleaners, cooling towers, small 

boilers, space heaters, certain internal combustion engines, fuel cells and microturbines, 

and certain process heaters like small crucibles and ceramic kilns. 

• Food and beverage processing equipment including equipment used in eating 

establishments for human consumption, small coffee roasters, non-commercial 

barbeques, ovens at small bakeries, and small brewing operations. 

• Small spray coatings, solvent cleaning and composting operations. 

• Vehicles and mobile equipment. 

• Residential and commercial uses including equipment at residences, ventilation or 

comfort air systems, refrigeration units not serving as pollution controls, and coatings 

applied to structures. 
10 

Staff Report For Board Adoption Hearing April 24, 2014 

Proposed Amended Rules for SIP Submittal 

 

• Portable handheld and certain abrasive blasting equipment. 

• Certain agricultural sources. 

• Replacement equipment meeting the rule criteria. 

• Small printing and reproduction operations. 

• Certain wastewater facilities. 

• Certain woodworking and fabrication operations. 

• Pilot tests for soil remediation projects. 

• Specific walnut hulling and drying processes. 

• Low Emitting Sources with actual emissions of less than 2 pounds per day or, if greater 

than 2 pounds per day, less than 75 pounds per year of criteria pollutant emissions. 

The rule includes conditionally exempt sources which require the source to apply for an 

exemption and a determination by the APCO. This section includes provisions for: 

• Replacement of Equipment. 

• Other low emitting sources that emit no more than 500 pounds per year of a regulated 

pollutant that is reviewed and confirmed by the APCO. 

• Other sources wanting confirmation in writing that a specific emissions unit is exempt 

under the provisions of Rule 401 may voluntarily submit an application for a written 

determination. 

The proposed rule requires the owner or operator claiming an exemption to keep documentation 

of the applicable information that demonstrates compliance with the exemption criteria. This 

documentation must be current for the previous two years. 

If a source loses “exempt” status with the adoption of this rule, the source shall have six (6) 

months to apply for a permit under the provisions of Rule 400. In addition, a source that was 

exempt and exceeds an exemption limitation shall have 30 days to submit an application for a 

permit or other written authorization from the APCO. 

Rule 430-State New Source Review 

The District adopted amended Rule 430 in May 2011 to fulfill CAA program requirements to 

have New Source Review for minor sources. No changes are proposed for Rule 430 and it will 

not be submitted for SIP approval. This rule is not a part of these rule actions but is mentioned as 

it is part of the overall SIP approval process. 

Rule 432-Federal New Source Review

Rule 432 establishes nonattainment air pollutants pre-construction review requirements for new 

and modified major stationary sources and major modifications. In May 2011, the District 

repealed the existing Rule 432 and adopted a new Rule 432 due to the extensive changes to the 

rule. The previous rule lacked three major elements of the federal program proposed in the new 

rule. These include the Alternate Siting requirement, Certification of Compliance and Potential 

Visibility Impacts review. 
11 

Staff Report For Board Adoption Hearing April 24, 2014 

Proposed Amended Rules for SIP Submittal 

 

The District is proposing amendments to Rule 432 to clarify the applicability of the rule, add or 

clarify definitions, remove references to requirements in rules not included in the SIP, and add or 

clarify program requirements in the rule. 

In the Purpose and Applicability Sections, the language has been reworded to clarify the rule 

regulates nonattainment pollutant emissions from major sources and major modifications. 

Amendments are proposed to the Section 2 Definitions to: 

Delete some terms not used in this version of the rule, such as “Control Efficiency”. Include all 

applicable pollutants in definitions where they may have been omitted. Remove Ambient Air 

Quality Standard and add a definition for National Ambient Air Quality Standards since only 

National Standards are applicable to this rule. The term “Basic Design Parameters” was defined. 

EPA recommended “Baseline Actual Emissions” be referred to as noted in parenthesis more 

traditionally as “Historical Actual Emissions”. The definition has not change but was moved to 

be in alphabetically order. Under the term, “Impact Analysis”, a program requirement to add 

ground level concentrations to background has been moved to the Air Quality Analysis section in 

Rule 400. The definition of “interpollutant” has been clarified to indicate that precursors may be 

interchanged. PM10 and PM2.5 definitions now include that gaseous emissions which may 

condense at ambient temperatures are also considered to be particulate. 

Section 5 relates to the requirements for emissions units subject to the rule and has been clarified 

to ensure the rule meets federal program requirements. The requirement for offsets needed for 

carbon monoxide has been deleted since Butte County was designated attainment for CO as 

published in the Federal Register on June 1, 1998. Also in this section, the rule is proposed for 

amendment to not allow interpollutant offsetting for PM2.5 Unless EPA approves specific 

interpollutant offset ratios for PM2.5 in the SIP. 

Section 6 includes the calculation requirements for determining offsets and has been streamlined 

to include only the necessary federal requirements. A requirement that offsets must be identified 

at the time of application but not surrendered until starting operation has also been added. 

Amendments to update requirements are proposed for the administrative requirements in Section 

7 of the Rule that are necessary since the rule was adopted in May 2011. Revisions to the 

requirements for Potential Visibility Impacts include requiring an applicant of a proposed new 

major source or major modification to perform an analysis on the visibility impacts to a Class 1 

area and that the APCO shall deny the permit for any source subject to this requirement that has 

an adverse impact on visibility of a Class 1 area. 

The District intends to follow the guidance from EPA Region IV (March 8, 2011 by Beverly H. 

Banister) and the Federal Land Managers Group to implement the visibility requirements. These 

guidance documents state “that may affect” would include any new major source or major 

modification that is within 100 kilometers of any Class 1 area and possibly sources further than 

100 km if other factors, such as the size of the stationary source, causes concerns about possible 

visibility impacts to any Class 1 area. 
12 

Staff Report For Board Adoption Hearing April 24, 2014 

Proposed Amended Rules for SIP Submittal 

 

 The closest Class 1 area to Butte County is Lassen Volcanic National Park which is located 

approximately 35 kilometers due north of the northern most portion of the County and about 88 

kilometers northeast of Chico, CA, the County’s largest municipality. The Caribou Wilderness, 

Thousand Lakes Wilderness, and Yolla Bolly-Middle Eel Wilderness areas are also located 

within 100 kilometers of the northern boundary of the District. To the southeast, the Desolation 

Wilderness area is located approximately 100 kilometers from the southeastern boundaries of the 

District. The air quality analysis requirements have been moved to Rule 400 as they are a 

general permit requirement. Rule 432 requires any analysis to adhere to requirements in Rule 

400. Also, a CAA requirement that any source that becomes a major source due to a relaxation in 

any condition or permit limit shall be reviewed as if the source had not been constructed has 

been included. 

Finally, the District is proposing to delete standards that were incorporated into the Rule in 2011 

as part of federal NSR Reform measures. These include Less Than Significant Increase 

Exclusion and Plant-wide Applicability Limit (PAL) Exclusion. The District is proposing to 

delete these measures since the existing permitting program required at the State level is 

significantly more stringent than federal requirements and, therefore, the intended 

permitting flexibility benefits from these federal measures do not exist for District sources. 

In reviewing the Technical Support Document for another Sacramento Valley air district1, 

the District understands that Section 116 of the CAA provides that a State may adopt 

regulations that are more stringent than those contained in the CAA or implementing 

regulations. In 1988, California adopted the California Clean Air Act which set thresholds 

for new and modified sources to require controls and offsets which were significantly lower 

than the federal thresholds at that time (and lower than thresholds included in the federal 

CAA amendments of 1990). The District definition of BACT is equivalent to the federal 

LAER definition. In addition, the calculations used to determine offset requirements for 

State purposes The District maintains that the requirements in the District’s permitting 

program to meet State requirements are significantly lower than federal requirements. For 

example, the State Best Available Control Technology (BACT) thresholds for new or 

modified sources are in pounds per day (i.e. NOx is 25 lbs/day) where the federal standard 

for new sources is 100 Tons per year (approx. 550 lbs/day average) and for modified 

sources is 40 TPY (approx. 220 lbs/day average). State offsets are required for all 

nonattainment pollutants over 25 tons per year and the federal threshold is 100 tons per year 

a new source. CA CAA assures the permit program is at least as stringent as a program 

required by the federal CAA. Therefore, the District rules are not required to include these 

additional NSR Reform requirements. 

Rule 433—Rice Straw Emission Reduction Credits

Rule 433 was adopted in August 2010 to develop a federally enforceable program to bank 

emission reductions from discontinued rice straw burning as allow by California Health and 

Safety Code§ 41865. The proposed amendments are to remove references to rules not 

 

1

 EPA, Region IX, Technical Support Document, Sacramento Metropolitan AQMD Rules 214 and 203, May 6, 

2011. 
13 

Staff Report For Board Adoption Hearing April 24, 2014 

Proposed Amended Rules for SIP Submittal 

 

included in the SIP and to include those referenced requirements if necessary. The District is 

also addressing earlier EPA comments in this staff report. 

Regarding the EPA’s concern over the Historical Burn Fraction used in Rule 433: The 

District selected 1991 as the representative year since the acreage was considerable less than the 

average acres planted and the amount burned was nearly the acres planted. The District believes 

it resolved EPA’s concerns related to the actual fraction of acres in the Staff Report is 97.5% not 

100% at the time of adoption. During the District’s participation in the Sacramento Valley 

Basinwide Control Council which recognized that although averages are used to determine the 

acres planted and the corresponding burn acres are represented in the report, those growers that 

burned fields during the baseline period burned 100% of a field and not 97.5% of it. Therefore, 

the District wished to maintain a HBF of 1.00 and proposed to do so by reducing the total 

allowable burn allocation acres to compensate for the emissions that would be reduced by using 

a HBF of 0.975. Calculation: 69,142 burned acres originally proposed – (69,142* (1.00-

0.975))=67,413 total (adjusted) acres burned. The emissions inventory from the originally 

proposed 69,142 acres times the EPA presumed HBF of 0.975 will be the same as the adjusted 

acres and ensure the reductions are still real, surplus and quantifiable. The District replaced the 

maximum allowable burn acres (currently 69,142) in the rule with the adjusted acres (67,413). 

During the available registration period, only one grower chose to bank Rice Straw ERCS and 

this amounted to banking emissions from only 196 acres in the District or only 0.3% of the total 

acres eligible for the program. The application period for obtaining Rice Straw ERCs has 

expired.

EPA has concerns that for federal offset purposes, the ERCs must come from the nonattainment 

areas in Butte County. The proposed amended rule now includes this requirement. This 

amendment is considered administrative since the PM2.5 attainment areas of the county are 

mountainous and the District has no records of rice being grown in these regions above 3000 feet 

in elevation. 

5.0 COST IMPACTS/COST EFFECTIVENESS: 

The proposed amended rules do not implement an emission control measure or other requirement 

that is not already in place and therefore are not subject to the cost effectiveness mandate. The 

proposed amended rules are administrative in nature and no additional costs to either the District 

or stakeholders are expected. In addition, because BACT requirements and feasible control 

measures are not amended, an incremental cost-effectiveness analysis under Health & Safety 

Code Section 40920.6 is not required. 

6.0 ALTERNATIVES:

The Governing Board may choose to: 

a) Approve the rules as proposed; 

b) Direct staff to modify the proposed amended rules after receiving public comments 

during the hearing; or 
14 

Staff Report For Board Adoption Hearing April 24, 2014 

Proposed Amended Rules for SIP Submittal 

 

c) Take no action. If your Board decides to not take action, EPA will be required to give a 

limited approval of the rules and require the District to make the necessary corrections 

within a specified time frame, usually 18 months. If the District fails to make the 

necessary program corrections, Butte County could be subject to federal sanctions, 

including withholding of highway funds. 

7.0 ENVIRONMENTAL REVIEW AND COMPLIANCE 

 

Staff has determined that proposed amended and the proposed amendments to the rules are 

exempt from CEQA requirements and are therefore considered to be ministerial in nature and 

thus are statutorily exempt from CEQA, pursuant to state CEQA Guidelines Section 15268 – 

Ministerial Projects, as defined by CEQA Guidelines Section 15369. 

8.0 REQUIRED FINDINGS:

Findings required by Division 26 of the California Health and Safety Code requires local districts 

to comply with a rule adoption protocol as set forth in Section 40727 of the Code. This section 

has been revised through legislative mandate to contain six findings that the District must make 

when developing, amending, or repealing a rule or regulation. These findings, and their 

definitions are included in the following table. 

Table 7 

FINDING DEFINITION REFERENCE

Authority A District shall adopt Rules and 

regulations and do such acts as may be 

necessary or proper to execute the 

powers and duties granted to, and 

imposed upon, the District by this 

division and other statutory 

provisions. 

California Health and Safety Code 

Division 26, Part 3, Sections 40000 

and 40001, 40702, and 42300 et. seq., 

are provisions of law that provide the 

District with the authority to adopt 

these proposed rules. 

Necessity The District has demonstrated that a 

need for the Rule, or for Rule 

amendment or repeal. 

Federal and State law requires the 

District maintain a minor and major 

source permitting program. The 

proposed rules provide the 

requirements to implement the State 

and federal requirements. 

Clarity The Rule is written or displayed so 

that its meaning can easily be 

understood by the persons directly 

affected by it. 

There is no indication that the 

proposed amended rules are written in 

such a manner that persons affected by 

the rule cannot easily understand it. 

Consistency This Rule is in harmony with, and not 

in conflict with or contradictory to, 

existing statutes, court decisions, or 

State or federal regulations. 

The District has found that the 

proposed amended rules are consistent 

with applicable statutory requirements.

Non- The Rule does not impose the same The proposed rule duplicates federal 
15 

Staff Report For Board Adoption Hearing April 24, 2014 

Proposed Amended Rules for SIP Submittal 

 

Duplication requirements as an existing State or 

federal regulation, unless the District 

finds that the requirements are 

necessary and proper to execute the 

powers and duties granted to, and 

imposed upon, the District. 

rules or regulations for permitting 

programs. The duplicative 

requirements are necessary in order to 

execute the powers and duties imposed 

upon the District. 

Reference Any statute, court decision, or other 

provision of law that the district 

implements, interprets, or makes 

specific by adopting, amending, or 

repealing a regulation. 

California Health and Safety Code 

Division 26, Part 3, Sections 40000 

and 40001, 40702, and 42300; Clean 

Air Act amendments of 1990 and 

related regulations. 

9.0 ATTACHMENTS 

Attachment A Rule 100-Defintions (Proposed Amendments)

Attachment B Rule 400-Permit Requirements (Proposed Amendments) 

Attachment C Rule 401-Permit Exemptions (Proposed Amendments)

Attachment D Rule 432-Federal New Source Review (Proposed Amendments) 

Attachment E Rule 433-Rice Straw Emission Reduction Credits (Proposed 

Amendments) 

Attachment F Notice of Public Workshop and Hearing 

Attachment G Draft Resolution of Adoption 

 

 
16 

Staff Report For Board Adoption Hearing April 24, 2014 

Proposed Amended Rules for SIP Submittal 

 

Attachment A 

Rule 100-Definitions (Proposed Amendments) 

Attachment B 

Rule 400-Permit Requirements (Proposed Amendments) 

Attachment C 

Rule 401-Permit Exemptions (Proposed Amendments) 

Attachment D 

Rule 432-Federal New Source Review (Proposed Amendments) 

Attachment E 

Rule 433-Rice Straw Emission Reduction Credits (Proposed Amendments) 

Attachment F 

Notices of Public Workshops and Hearing 

Attachment G 

Proposed Resolution of Adoption 
17 

Staff Report For Board Adoption Hearing April 24, 2014 

Proposed Amended Rules for SIP Submittal 

 

Attachment A 

Rule 100-Definitions (Proposed Amendments) 
18 

Staff Report For Board Adoption Hearing April 24, 2014 

Proposed Amended Rules for SIP Submittal 

 

Attachment B 

Rule 400-Permit Requirements (Proposed Amendments) 
19 

Staff Report For Board Adoption Hearing April 24, 2014 

Proposed Amended Rules for SIP Submittal 

 

Attachment C 

Rule 401-Permit Exemptions (Proposed Amendments) 
20 

Staff Report For Board Adoption Hearing April 24, 2014 

Proposed Amended Rules for SIP Submittal 

 

Attachment D 

Rule 432-Federal New Source Review (Proposed Amendments) 
21 

Staff Report For Board Adoption Hearing April 24, 2014 

Proposed Amended Rules for SIP Submittal 

 

Attachment E 

Rule 433-Rice Straw Emission Reduction Credits (Proposed Amendments) 
22 

Staff Report For Board Adoption Hearing April 24, 2014 

Proposed Amended Rules for SIP Submittal 

 

Attachment F 

Notices of Public Workshops and Hearing 
23 

Staff Report For Board Adoption Hearing April 24, 2014 

Proposed Amended Rules for SIP Submittal 

 

NOTICE OF PUBLIC WORKSHOP AND HEARING 

NOTICE IS HEREBY GIVEN that the Butte County Air Quality Management District (District) 

Governing Board will hold a public workshop and hearing to consider adoption of proposed 

amendments to Rule 100-Definitions, Rule 400-Permit Requirements, Rule 401-Permit

Exemptions, Rule 432-Federal New Source Review and Rule 433-Rice Straw Emission Reduction 

Credits. The proposed amendments to the rules streamline the rules to improve consistency, 

remove unneeded references, and include missing elements necessary to fulfill the minimum 

permitting program requirements for submittal into the District’s State Implementation Plan. The 

proposed amendments do not change the current implementation of the permit program. The 

time, date, and location of the public workshop and hearing are given below: 

Public Workshop: 2:00 p.m. April 3, 2014, District office, (address below) 

Public Hearing: 10:00 a.m. April 24, 2014, City of Oroville Council Chambers, 1735 

Montgomery Street, Oroville, CA 95965 

The Staff Report and proposed amended rules may be reviewed at the District office at the 

address below or on the District website: www.bcaqmd.org. For additional information please 

contact David Lusk at (530) 332-9400, ext. 107. Written comments on the proposed rules must 

be submitted by April 17, 2014 to: Board Clerk, Butte County Air Quality Management District, 

629 Entler Avenue, Suite 15, Chico, CA 95928. 

DATED: March 25, 2014 

BY: W. James Wagoner 

 Air Pollution Control Officer 
24 

Staff Report For Board Adoption Hearing April 24, 2014 

Proposed Amended Rules for SIP Submittal 

 

Attachment G 

Proposed Resolution of Adoption 
25 

Staff Report For Board Adoption Hearing April 24, 2014 

Proposed Amended Rules for SIP Submittal 

 

DRAFT RESOLUTION 2014-04 

BEFORE THE BOARD OF DIRECTORS OF 

BUTTE COUNTY AIR QUALITY MANAGEMENT DISTRICT 

STATE OF CALIFORNIA 

Resolution 2014-04.....................................................................) 

Adopt Proposed Amended Rules 101, 400, 401,432, and 433 ............) 

WHEREAS, the Butte County Air Quality Management District Board obtains its authority to adopt, amend,

or repeal rules and regulations from California Health and Safety Code Sections 40000, 40001, 40701, 

40702; 

AND WHEREAS, the Butte County Air Quality Management District Board has determined that the 

proposed amended rules are written such that the meaning can be understood by the persons directly 

affected by it (Health and Safety Code Section 40727(b)(3)); 

AND WHEREAS, the Butte County Air Quality Management District Board has determined that the 

proposed amended rules adopted herein is in harmony with, and not in conflict with or contradictory to

existing statutes, court decisions, or state or federal regulations (Health and Safety Code Section 

40727(b)(4)); 

AND WHEREAS, the Butte County Air Quality Management District Governing Board has determined that 

proposed amendments to Rules 101-Definitions, Rule 400-Permit Requirements, Rule 401-Permit 

Exemptions, Rule 432-Federal New Source Review (FNSR), and Rule 433-Rice Straw Emission Reduction 

Credits are necessary to streamline and clarify the existing rules to ensure they contain the necessary 

program elements as required by the federal Clean Air Act prior to re-submittal for State Implementation 

Plan approval; 

AND WHEREAS, the Butte County Air Quality Management District Governing Board has determined that 

proposed amendments to Rule 400-Permit Requirements are necessary to remove references to rules not 

intended for SIP submittal, clarify public notice thresholds and ensure the APCO considers comments prior 

to issuing a permit, include air quality analysis requirements previously included in the New Source Review 

rules, and to move and delete sections more appropriately located in the New Source Review rules; 

AND WHEREAS, the Butte County Air Quality Management District Governing Board has determined that 

Sections 4.4.7, 4.11, 5.2.4.5, 5.3, 5.4, 5.6, 5.7, and 5.8 of Rule 400 are applicable to local and State 

requirements and are not be include in the federal SIP submittal; 

AND WHEREAS, the Butte County Air Quality Management District Board has determined proposed 

amendments to Rule 401-Permit Exemptions are necessary to include applicable thresholds in non-SIP 

rules and remove an unintended application requirement for insignificant sources, and provide an 
26 

Staff Report For Board Adoption Hearing April 24, 2014 

Proposed Amended Rules for SIP Submittal 

 

intermediate threshold for exemption review and determination; 

AND WHEREAS, the Butte County Air Quality Management District Board has determined that the 

proposed amendments to Rule 432-Federal New Source Review are necessary to ensure all major and 

major modifications to sources meet the applicable federal requirements prior to obtaining a permit, to 

include specific definition and requirements to meet all Clean Air Act program requirements and to move 

requirements of the existing rule to more appropriate sections of Rule 400-Permit Requirements; 

AND WHEREAS, the Butte County Air Quality Management District Board has determined that the 

proposed amendments to Rule 433-Rice Straw Emission Reduction Credits are necessary to ensure 

credits issued under this rule are only federally applicable in located in the nonattainment areas; 

AND WHEREAS, the Butte County Air Quality Management District Board has determined that the 

proposed amended Rules 101-Definitions, Rule 400-Permit Requirements, Rule 401-Permit Exemptions, , 

and Rule 433-Rice Straw Emission Reduction Credits do not duplicate local, state or federal rules or 

regulations for permitting programs; 

AND WHEREAS, the Butte County Air Quality Management District Board has determined that the portions 

of the proposed new Rule 432 duplicates federal rules or regulations for permitting programs and the 

duplicative requirements are necessary in order to execute the powers and duties imposed upon the 

District; 

AND WHEREAS, the District staff has made notice of and held a public workshop meeting on the proposed 

amended Rules on April 3, 2014 and received no public comments on the rules; 

AND WHEREAS, the Butte County Air Quality Management District Board conducted public hearing on 

April 24, 2014 concerning the proposed rules herein; 

THEREFORE, BE IT RESOLVED, that the Butte County Air Quality Management District Board hereby 

adopts proposed amendments to Rules 101-Definitions, Rule 400-Permit Requirements, Rule 401-Permit 

Exemptions, Rule 432-Federal New Source Review (FNSR), and Rule 433-Rice Straw Emission Reduction 

Credits with an effective date of April 24, 2014, as proposed in the attachments to the March 25, 2014 Staff 

Report released for Public Workshop with typographical, formatting, and other changes as noted in the 

Staff Report released for Board Adoption Hearing including indicating Rule 400 Section 4.4.7 is not 

intended for SIP submittal, Rule 400 Section 4.5 clarifying the public notice threshold is for each AAQS 

pollutant, and Rule 401 Section 2.6 removal since methodologies are changing and APCO has this 

authority in Section 2.3; 

BE IT FURTHER RESOLVED, that the Butte County Air Quality Management District Board directs staff to 

prepare the designated portions of Rules 101-Definitions, Rule 400-Permit Requirements, Rule 401-Permit 

Exemptions, Rule 432-Federal New Source Review (FNSR), and Rule 433-Rice Straw Emission Reduction 

Credits for submittal into the federal ozone and PM2.5 nonattainment, if applicable, State Implementation 

Plans as noted in the Staff Report for Board Adoption. 

On Motion of ______________, Seconded by _____________, the foregoing resolution is hereby PASSED 
27 

Staff Report For Board Adoption Hearing April 24, 2014 

Proposed Amended Rules for SIP Submittal 

 

AND ADOPTED BY THE Air Quality Management District Board of Directors on this 24th day of April, 2014 

by the following: 

AYES: 

NOES: 

ABSTAIN: 

ABSENT: 

_______________________________________ 

W. James Wagoner, Air Pollution Control Officer 

Butte County Air Quality Management District 

I hereby attest that this is a true and correct copy of the action taken by the Butte 

County Air Quality Management District Board of Directors on April 24, 2014 

 ATTEST: ______________________________________ 

Cora Collins, Clerk of the Governing Board