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Federal Register / Vol. 70, No. 228 / Tuesday, November 29, 2005/Rules and Regulations

ENVIRONMENTAL PROTECTION

AGENCY

40 CFR Parts 51, 52, and 80

(OAR 2003-0079; FRL-7996-81

RIN 2060-AJ99

Final Rule To Implement the 8-Hour

Ozone National Ambient Air Quality

Standard-Phase 2; Final Rule To

Implement Certain Aspects of the 1990

Amendments Relating to New Source

Review and Prevention of Significant

Deterioration as They Apply in Carbon

Monoxide,. Particulate Matter and

Ozone NAAQS; Final Rule for

Reformulated Gasoline

AGENCY: Environmental Protection

Agency (EPA).

ACTION: Final rule.

SUMMARY: In this document, we are

taking final action on most remaining

elements of the program to implement

the 8-hour ozone national ambient air

quality standard (NAAQS or standard).

This final rule addresses, among other

things, the following control and

planning obligations as they apply to

areas designated nonattainment for the

8-hour ozone NAAQS: reasonably

available control technology and

measures (RACT and RACM),

reasonable further progress (RFP),

modeling and attainment

demonstrations, and new source review

(NSR). We are issuing this rule so that

States and Tribes will know how these

statutory control and planning

obligations apply and when State

implementation plan (SIP) revisions are

due for these obligations so that the

States may develop timely submissions

consistent with the statutory obligations

and attain the NAAQS as expeditiously

as practicable but no later than their

maximum attainment dates. The

intended effect of the rule is to provide

certainty to States and Tribes regarding

development of those plans.

In this rule, we are also finalizing

several revisions to the regulations

governing the nonattainment NSR

programs mandated by section

110(a)(2)(C) and part D of title I of the

Clean Air Act (CAA).

Finally, this rule addresses what

effect the transition to the 8-hour

standard will have on certain aspects of

the Reformulated Gasoline (RFG)

program. The nine original mandatory

RFG areas, as well as most other areas

that have become mandatory RFG areas

by being reclassified as severe areas

under section 181(b) of the CAA, will

continue to be required to use RFG at

least until they are redesignated to

attainment for the 8-hour NAAQS. The

EPA reserves for future consideration

what effect the transition to the 8-hour

standard will have on areas reclassified'

as severe areas for the 1-hour NAAQS

under section 181(b) of the CAA that

were redesignated to attainment for the

1-hour standard before revocation of

that standard.

EFFECTIVE DATE: This rule is effective on

January 30, 2006.'

ADDRESSES: The EPA has established a

docket for this action under Docket ID

No. OAR-2003-0079. All documents in

the docket are listed in the EDOCKET

index at http://www.epa.gov/edockqt.

Although listed in the index, some

information is not publicly available,

i.e., Confidential Business Information

or other information whose disclosure is

restricted by statute. Certain other

material, such as copyrighted material,

is not placed on the Internet and will be

publicly available only in hard copy

form. Publicly available docket

materials are available either

electronically in EDOCKET or in hard

copy at the EPA Docket Center (Air

Docket), EPA/DC, EPA West, Room

B102, 1301 Constitution Ave., NW.,

Washington, DC. The Public Reading

Room is open from 8:30 a.m. to 4:30

p.m., Monday through Friday, excluding

legal holidays. The telephone number

for the Public Reading Room is (202)

566-1744, and the telephone number for

the Office of Air and Radiation Docket

and Information Center is (202) 566-

1742.

In addition, we have placed a variety

of earlier materials regarding

implementation of the 8-hour ozone

.NAAQS on the Web site: http://

www.epoa.gov/ttnlnaaqs/ozone/

o3impfhr.

FOR FURTHER INFORMATION CONTACT: For

general information: Mr. John Silvasi,

Office of Air Quality Planning and

Standards, U.S. Environmental

Protection Agency, Mail Code C539-02,

Research Triangle Park, NC 27711,

phone number (919) 541-5666, fax

number (919) 541-0824 or by e-mail at

silvasi.john@epa.gov or Ms. Denise

Gerth, Office of Air Quality Planning

and Standards, U.S. Environmental

Protection Agency, Mail Code C539-02,

Research Triangle Park, NC 27711,

phone number (919) 541-5550, fax

number (919) 541-0824 or by e-mail at

geith.denise@epa.gov. For information

concerning new source review: Ms.

Janet McDonald, Office of Air Quality

Planning and Standards, U.S.

Environmental Protection Agency, Mail

Code C539-03, Research Triangle Park,

NC 27711, phone number (919) 541-

1450, fax number (919) 541-5509 or by

e-mail at mcdonald.janet@epa.gov.

SUPPLEMENTARY INFORMATION:

Outline

I. What is the Background for this Rule?

II. What is Included in this Rule?

III. In Short, What Does this Final Rule

Contain?

IV. Final Rule for Phase 2 Elements Other

than NSR and RFG

A. Should prescribed requirements of

subpart 2 apply in all 8-hour

nonattainment' areas classified under

sub part 2, or is there flexibility in

application in certain narrowly-defined "

circumstances?

B. How will we address long-range

transport of ground-level ozone and its

precursors when implementing the 8-

hour ozone standard?.

C. How will we address transport of

ground-level ozone and its precursors for

rural nonattainment areas, areas affected

by intrastate transport, and areas affected

by international transport?

D. How will EPA address requirements for

- modeling and attainment demonstration

SIPs for areas implementing the 8-hour

ozone standard?

E. What requirements for RFP should apply

under the 8-hour ozone standard?

F. Are contingency measures required in

the event of failure to meet a milestone

or attain the 8-hour ozone NAAQS?

G. What requirements should apply for

RACM and RACT for 8-hour ozone

nonattainment areas?

H. How will the section 182(f) NOx

provisions be handled under the 8-hour

ozone standard?

I. Should EPA promulgate a NSR provision

to encourage development patterns that

reduce overall emissions?

J. How will EPA ensure that the 8-hour

ozone standard will be implemented in

a way which allows an optimal mix of

controls for ozone, PM2.5, and regional

haze?-

K. What emissions inventory requirements

should apply under the 8-hour ozone

NAAQS?

L. What guidance should be provided that

is specific to Tribes?

M. What are the requirements for Ozone

Transport Regions (OTRs) under the 8-

houi ozone standard?

N. Are there any additional requirements

related to enforcement and compliance?

0. What requirements should apply to

emergency episodes?

P. What ambient monitoring requirements

will apply under the 8-hour ozone

NAAQS?

Q. When will EPA require 8-hour

attainment demonstration SIP

submissions?

R. How will the statutory time periods in

the CAA be addressed when we

redesignate areas to nonattainment

following initial designations for the 8-

hour NAAQS?

V. EPA's Final Rule for New Source Review

A. Background

B. Summary of Final Rule and Legal Basis

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C. Comments and Responses

D. NSR Implementation Under the 8-hour

ozone NAAQS

VI. Final Rule for RFG

A. Introduction

B. Background

C. What Action is EPA Taking?

D. Why is EPA Taking This Action?

E. Future Proceedings

F. Miscellaneous Administrative Changes

to RFG Regulations

G. Comments and Responses

VII. Other Considerations

A. How will EPA's implementation of the

8-hour ozone NAAQS affect funding

under the Congestion Mitigation and Air

Quality Improvement (CMAQO Program?

B. What is the relationship between

implementation of the 8-hour standard

and the CAA's title V permits program?

C. What action is EPA taking on the

Overwhelming Transport Classification

for Subpart 1 Areas?

VIII. Statutory and Executive Order Reviews

A. Executive Order 12866: Regulatory

Planning and Revievx

B. Paperwork Reduction Act

C. Regulatory Flexibility Act

D. Unfunded Mandates Reform Act

E. Executive Order 13132: Federalism

F. Executive Order 13175: Consultation

and Coordination with Indian Tribal

Governments

G. Executive Order 13045: Protection of

Children from Environmental Health and

Safety Risks

H. Executive Order 13211: Actions That

Significantly Affect Energy Supply,

Distribution, or Use

1. National Terhnology Transfer

Advancement Act *

J. Executive Order 12898: Federal Actions

to Address Environmental Justice in

Minority Populations and Low-Income

Populations

K. Congressional Review Act

L. Petitions for Judicial Review

M. Determination Under Section 307(d)

Appendix A to Preamble--Methods to

Account for Non-Creditable Reductions

when Calculating ROP Targets for the

2008 and Later ROP Milestone Years

Appendix B to Preamble--Glossary Of

Terms and Acronyms

I. What Is the Background for This

Rule?

On June 2, 2003 (68 FR 32805), we

published a proposed rule to implement

the 8-hour ozone NAAQS. The proposal

addressed a number of implementation

issues. We proposed one or more

options for each issue addressed in the

proposal. Please refer to the proposed

rule (68 FR 32802) for a detailed

discussion and background information

on the 8-hour ozone NAAQS; the

associated litigation; our proposed

strategy for areas to achieve the NAAQS;

and the stakeholder process for

gathering input into this effort, among

other topics.

On August 6, 2003 (68 FR 46536), we

published a notice of availability of the

draft regulatory text for the'proposed

rule to implement the 8-hour ozone

NAAQS. This notice started a 30-day

public comment period on the draft

regulatory text.

On April 30, 2004 (69 FR 23951), we

published a final rule that addressed the

following key elements related to

implementation of the 8-hour ozone

NAAQS: classifications for the 8-hour

NAAQS; revocation of the 1-hour

NAAQS (i.e., when the 1-hour NAAQS

will no longer apply); how antibacksliding principles will ensure

continued progress toward attainment of

the 8-hour ozone NAAQS; attainment

dates; and the timing of emissions

reductions needed for attainment.

Following publication of the April 30,

2004 final rule, the Administrator

received three petitions, pursuant to

section 307(b)(7)(B) of the CAA

requesting reconsideration of a number

of aspects of the final rule., On

September 23, 2004, we granted

reconsideration of three issues raised in

the Earthjustice Petition. On February 3,

2005 (70 FR 5593), we published a

proposed rule to take comment on two

of these issues: (1) The provision that

section 185 fees would no longer be

applicable once the 1-hour NAAQS is

revoked and (2) the timing for

determination of what is an "applicable

requirement." On May 20, 2005, the

final rule on these two issues was

signed by the Administrator of EPA. On

April 4, 2005 (70 FR 17018), we

published a proposed rule to take

comment on the issue of whether we

should interpret the Act to require areas

to retain major NSR requirements that

apply to certain 1-hour ozone.

nonattainment areas in implementing

the 8-hour standard. We took final

action on the NSR issues on June 30,

2005 (70 FR 39413; fuly 8, 2005).

On January 10, 2005, we granted

reconsideration of the overwhelming

transport classification issue raised by

Earthjustice in their Petition. At the

same time, we denied reconsideration of

the issues they raised in their Petition

dealing with the applicability of RFG

when the 1-hour NAAQS is revoked and

future 8-hour ozone redesignations to

nonattainment. We intend to publish a

proposed rule on the overwhelming

'Three petitions for reconsideration of the Phase

1 Rule were filed by: (1) Earthjustice on behalf of

the American Lung Association, Environmental

Defense, Natural Resources Defense Council, Sierra

Club, Clean Air Task Force, Conservation Law

Foundation, and Southern Alliance for Clean

Energy; (2) the National Petrochemical and Refiners

Association and the National Association of

Manufacturers; and (3) the American Petroleum

Institute, American Chemistry Council, American

Iron and Steel Institute, National Association of

Manufacturers and the U.S. Chamber of Commerce.

transport classification shortly. We are

continuing to review the issues raised in

the National Petrochemical and Refiners

Association and American Petroleum

Institute Petitions. Copies of the

Petitions for Reconsideration and

actions EPA has taken regarding the

Petitions may be found at:

www.epa.gov/ttn/naaqs/ozone/

o3imp8hr.

In addition, in the April 30, 2004 rule,

-we established a subpart E in 40 CFR

part 81 "Identification of Area

Designations and Classifications for the

1-Hour Ozone NAAQS as of June 15,

2004 [Reserved]." We intend to publish

that list shortly.

Concerning the major NSR provisions,

today's final regulations were proposed

as part of two different regulatory

packages. On July 23, "1996 (61 FR

38250), we proposed changes to the

major NSR program, including

codification of the requirements of part

D of title I of the 1990 CAA

Amendments for major stationary

sources of volatile organic compounds

(VOC), NOx, particulate matter having a

nominal aerodynamic diameter less

than or equal to 10 microns (PMto), and

CO. On June 2, 2003 (68 FR 32802), we

proposed a rule to implement the 8-hour

ozone NAAQS. In the 2003 action, we

proposed a rule to identify the statutory

requirements that apply for purposes of

developing SIPs under the CAA to

implement the 8-hour ozone NAAQS

(68 FR 32802). We did not propose

specific regulatory language for

implementation of NSR under the 8-

hour NAAQS. However, we inditated

that we intended to revise the

nonattainment NSR regulations to be

consistent with the rule for

implementing the 8-hour ozone NAAQS

(68 FR 32844). On April 30, 2004 (69 FR

23951), we published a final rule that

addressed classifications for the 8-hour

NAAQS. The April 2004 rule also

included the NSR permitting

requirements for the 8-hour ozonestandard, which necessarily follow from

the classification scheme chosen under

the terms of subpart 1 and subpart 2.

Also, in our 1996 action, and then

again in our June 2, 2003 action, we

proposed to amend our nonattainment

NSR provisions to expressly include

NOx as an ozone precursor in

nonattainment major NSR programs (61

FR 38297 and 68 FR 32847). We also

proposed that, as provided under CAA

section 182(f), a waiver from

nonattainment NSR for NOx as an ozone

precursor would be available for both

subpart 1 and subpart 2 areas (68 FR

32846). Moreover, we proposed to

require States to modify their existing

programs to include NOx as an ozone

71613

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71614 Federal Register / Vol. 70, No. 228/Tuesday, November 29, 2005 / Rules and Regulations

precursor in attainment areas (68 FR

32846).

In 1996, we proposed to revise the

regulations limiting offsets from

emissions reductions due to shutting

down an existing source or curtailing

production or operating hours below

baseline levels ("shutdowns/

curtailments"). We proposed

substantive revisions in two alternatives

that would ease, under certain

circumstances, the existing restrictions

on the use of emission reduction credits

from source shitdowns and

curtailments as offsets.

On July 2.3, 1996, we proposed to

revise § 52.24 to incorporate changes

made by the 1990 CAA Amendments

related to the applicability of

construction bans (61 FR 38305). To

clarify our intent, our proposed 8-hour

ozone NAAQS implementation rule in

June 2003 explained that § 52.24(k)

remained in effect and would be

retained. In that action, we also

proposed that we would revise

§ 52.24(k) to reflect the changes in the

1990 CAA Amendments (68 FR 32846).

On June 2, 2003 (68 FR*32802), we

explained implementation of the major

NSR program under the 8-hour ozone

NAAQS during the SIP development

period, and proposed flexible NSR

requirements for areas that expected to

attain the 8-hour NAAQS within 3 years

after designation.

In this rule, we are also finalizing

several revisions to the regulations

governing the nonattainment NSR

programs mandated by section'

110(a)(2)(C) and part D of title I of the

Clean Air Act (CAA). First, we are

codifying requirements added to part D

of title I of the CAAin the 1990

Amendments related to permitting of

major stationary sources in areas that

are nonattainment for the ozone,

particulate matter (PM), and carbon

monoxide (CO) NAAQS. Second, we are

revising the criteria for crediting

emissions reductions credits from

shutdowns and curtailments as offsets.

Third, we are revising the regulations

for permitting of major stationary

sources in nonattainment areas in

interim periods between designation of

new nonattainment areas and EPA's

approval of a revised SIP. Fourth, we are

changing the regulations that impose a

moratorium (bari) prohibiting

construction of new or modified major

stationary sources in nonattainment

areas where the State fails to have an

implementation plan meeting all of the

requirements of part D. In addition to

the changes to the nonattainment NSR

regulations, we also are making one

change to the Prevention of Significant

Deterioration (PSD) regulations under

part C of title I of the CAA. We are

codifying nitrogen oxides (NOx) as an

ozone precursor in attainment and

unclassifiable areas.

Today's changes regarding NSR are

based on the proposed rule published

on June 2, 2003 to Implement the 8-hour

Ozone'National Ambient Air Quality

Standard (NAAQS), as well as the

proposed rule published on July 23,

1996 for "Prevention of Significant

Deterioration (PSD) and Non-attainment

New Source Review (NSR)." These

changes provide a consistent national

program for permitiing major stationary

sources under section 110(a)(2)(C) and

parts C and D of title I, including major

stationary sources of ozone precursors

in ozone nonattainment areas.

For the reader's convenience, a

glossary and list of acronyms appears in

Appendix B of this preamble.

II. What Is Included in This Rule?

Today's action, Phase 2 of the

implementation rule, addresses

numerous topics, but primarily focuses

on the following key implementation

obligations for areas designated

nonattainment for the 8-hour NAAQS:

RACT and RACM; RFP; modeling and "

attainment demonstrations; and NSR. It

also addresses what effect the transition

t6 the 8-hour standard will have on

certain aspects of the RFG program.

III. In Short, What Does This Final Rule

Contain?

This summary is intended to give

only a convenient overview of our final

rule. It should not be relied on for the

details of the actual rule. The, final rule

(regulatory text) and the discussion of it

in the sections bel6w should be

consulted directly.

Summary of Section IV (Below): Final

Rule for Phase 2 Elements Other Than

NSR and RFG

A. Should prescribed requirements of

subpart 2 apply in all 8-hour

nonattainment areas classified under

subpart 2, or is there flexibility in

application in certain ntirrowly defined

circumstancesZ

There may be a basts for waiving a

prescribed requirement on a case-bycase basis where imposition of the

requirement would create an absurd

result. If a State submits a

demonstration that application of a

specific requirement in a specific

nonattainment area would create an

absurd result, we will, consider

application' of the absurd results

doctrine at that time. We believe that

absurd results that might occur from

application of mandatory control

measures would happen only iii rare

instances, if at all.

B. How will we address long-range

transport of ground-level ozone and its.

precursors when implementing the 8-

hour ozone standard?

The EPA has issued two major rules

to address interstate transport of ozone

pollution. The 1998 NOx SIP Call Rule

already is achieving significant

reductions in NOx emissions that

contribute to interstate ozone pollutionin the eastern United States. Nineteen

States were required to achieve

reductions by May 2004, and additional

reductions are required by May 2007.

On May 1,2, 2005, EPA published the

Clean Air Interstate Rule (CAIR) in the

Federal Register (70 FR 25162). It

establishes statewide sulfur dioxide

(SO 2) and NOx emissions budgets for

upwind States that significantly.

contribute to nonattainment or interfere

with maintenance of the fine particle or

8-hour ozone air quality standards in

downwind States. For ozone, this action

established summertime NOx budgets

for the District of Columbia and 25

States in the eastern half of the country,

with reductions to be achieved by 2009.

and 2015. The CAIR goes beyond the

SIP call by requiring reductions from

additional States and by requiring

further emissions reductions in SIP call

States.

C. How will we address trdnsport of

ground-level ozone and its precursors

for rural nonattainment areas, areas

affected by intrastate transport, and

areas affected by international

transport?

1. Rural Transport Nonattainment Areas

The final rule does not contain any

revisions to current policy on rural

transport areas under section 182(h). We

do not believe there are any 8-hour

nonattaimnent areas covered under

subpart 2 that are "rural" and therefore

eligible for consideration for coverage

under section 182(h).

2. Intrastate Transport

The final rule does not contain any

additional provisions for addressing

intrastate transport for the reasons

stated in the proposal.

3. How will EPA address transport of

ground-level ozone and its precursors

for areas affected by international

transport?

We are not setting forth any regulatory

provisions related to international

transport in this rule. Section 179B of

-the CAA applies for these purposes. We

continue to recommend that States

confer with the appropriate EPA

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Federal Register /Vol. 70, No. 228/Tuesday, November 29, 2005 / Rules and Regulations

Regional Office to establish on a caseby-case basis the technical requirements

for these an alyses. These analyses will

be subject to public comment during the

State and Federal SIP processes.

D. How will EPA address requirements

for modeling and attainment

demonstration SIPs for areas

implementing the 8-hour ozone

standard?

The final rule retains the following

three elements that each attainment

demonstration SIP must include: (1)

Technical analyses to locate and "

identify sources of emissions that are

causing violations of the 8-hour NAAQS

within nonattainment areas (i.e.,

.analyses related to the emissions

inventory required for the

nonattainment area), (2) adopted

measures with schedules for

implementation and other means and

techniques necessary and appropriate

for attainment, and (3) contingency

measures required under section

.172(c)(9) of the CAA that can be

implemented without further action by

the State or the Administrator to cover

failures to meet RFP milestones and/or

attainment.

1. Attainment Demonstration Due Date

Areas required to submit an

attainment demonstration must do so no

later than 3 years after the effective date

of designation for the 8-hour ozone

NAAQS.

2. Multi-State Nonattainment Areas

State partners involved in a multiState ozone nonattainment area must

work together to perform the

appropriate modeling analyses to

identify control measures that will

enable the area to achieve attainment as

expeditiously as practicable. Each State

will be responsible for its portion of the

control program and will be held

accountable for controls identified for

implementation within its State

boundaries.

3. Role of Modeling Guidance in

Attainment Demonstrations

. Attainment demonstrations must be

consistent with 40 CFR 51.112. We will

generally review the demonstrations for

technical merit using EPA's most recent

modeling guidance at the time the

modeled attainment demonstration is

performed.

4. Multi-pollutant Assessments (OneAtmosphere Modeling)

There is no regulatory text on this

issue, but the preamble makes several

recommendations concerning multipollutant assessments.

E. What requirements for RFP should.

apply under the 8-hour ozone standard?

1. General Discussion . We are adopting nearly all the

approaches set forth in our proposed

rule for the various 1-hour rate-ofprogress (ROP) and 8-hour RFP issues.

2. What is the content and timing of the

plan for addressing the RFP

requirements under section 182(b)(1) for

areas covered under subpart 2?

Areas that are classified as moderate

under the 8-hour standard that have

already implemented their 15 percent

plans under their 1-hour ozone SIPs

would be considered to have met the

statutory 15 percent requirement.

Reasonable further progress for the first

6 years from the baseline year would be

covered under the more generic RFP

requirements of subpart 1. Serious and

above areas would have to meet 3

percent reductions per year starting in

the baseline year averaged over each 3-

year period out to the attainment year.

An 8-hour nonattainment area that is

identical, geographically, to its

predecessor 1-hour nonattainment area

(which has already done the 15 percent

reduction) will not be required to do

another 15 percent VOC-only reduction

plan. For an 8-hour moderate or higher

nonattainment area that contains a 1-

hour nonattainment area that has an

approved 15 percent VOC ROP. plan but

also contains areas that do not have an

approved 15 percent VOC ROP plan, the

final rule allows States the choice

between two options:

Option 1. Develop a new baseline and

new 15 percent VOC ROP emission

reduction target for the entire newly

expanded area. Determine that

emissions reductions that occur after the

2002 baseline emissions inventory year

are creditable in the combined new area.

The reductions must be of VOC only.

Option 2. Treat the 8-hour

nonattainment area as divided between

the old 1-hour area(s) and the newly

added 8-hour area. For the newly added

portion (which had not previously

implemented a 15 percent plan), States

must establish a separate 15 percent

VOC target under subpart 2. The

previous nonattainment area that fell

under the 1-hour standard will now be

subject to the subpart 1 provisions of the

CAA and will be able to credit both

VOC and NOx toward meeting the RFP

target for this portion of the

nonattainment area. VOC reductions to

meet the 15 percent requirement for the

portion of the new 8-hour

nonattainment area that has not yet met

this requirement may come from across

the entire 8-hour area.

The subpart 1 RFP provisions

addressed by the rule below that are

applicable in the former 1-hour portion

of the rea depend on the subpart 2

area's attainment- date as follows:

* In moderate areas that have an

attainment date within 5 years after

their 8-hour designation, for which

portions of the area have previously met

their 15 percent requirements under the

1-hour standard, the former 1-hofr

portion will only be subject to subpart

1 RFP requirements, which will be

satisfied with the measures that

demonstrate attainment as expeditiously

as practicable. These areas will not be

developing RFP plans separate from

their attainment plans. Thus, for these

areas, the only motor vehicle emissions

budgets that will be developed will be

for the attainment year.

e In moderate areas that have an

attainment date beyond 5 years after

their 8-hour designation, for which

portions of the area have previously met

their 15 percent requirements under the

1-hour standard, the former 1-hour

portion will only be subject to subpart

1 RFP requirements, which will be

satisfied with a plan to demonstrate 15

percent emissions reductions (which

may be either VOC or NOx or a

-combination of both) from 2002 to 2008,

and any additional emissions reductions

needed for attainment beyond 2008.

Thus, these areas (the entire 8-hour

nonattainment area) would establish a

motor vehicle emission budget for 2008

and for their attainment year.

Serious and above areas will be

developing both a 15 percent VOC plan

for the new portion of the 8-hour

nonattainment area and an 18 percent

VOC/NOx plan for the portion of the

area that previously met its 15 percent

requirement. Thus, the RFP plan as a

whole will establish total allowable

emissions for 2008 for the entire 8-hour

.nonattainment area. Therefore, the plans

for these areas, as well as moderate

areas that choose option one, will

establish motor vehicle emissions

budgets for both 2008 and the

attainment year.

3. What baseline year should be

required for the emissions inventory for

the RFP requirement?

We are using the 2002 inventory as

the baseline inventory for the RFP

requirement for areas designated

nonattainment in 2004 primarily

because of timing concerns related to

attainment dates and when data is

collected and compiled. However, in

response to several comments, we are

allowing States the option of justifying

the use of an alternative baseline year

inventory year for RFP.

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4. Should moderate and higher

classified areas be subject to prescribed

additional RFP requirements prior to

their attainment date?

Moderate areas would have to provide

additional emissions reductions (VOC/

NOR) needed to provide for attainment

by the beginning of the ozone season

prior to- the area's attainment date:

Serious and higher classified areas

would need to provide in their SIPs an

additional average of three percent per.

year emission reduction over each

subsequent 3-year period beyond the

initial 6-year period through the

attainment year.

5. What is the timing of the submission

of the RFP. plan?.

For moderate and higher classified

areas, the first RFP SIP must be

submitted within 3 years after the area's

nonattainment designation. For areas

with a June 15, 2004 effective date, for

the 8-hour designations, the SIP would

be due by June 15, 2007. This would

provide up to 3 years for States to

develop and submit RFP plans, and 1

additional year (until the end of 2008)

for control measures to be implemented.

The RFP SIP for any remaining 3-year

periods out to the attainment date

beyond the first 6 years would'be

required to be submitted with the

attainment demonstration, i.e., within 3

years after designation. We recommend

that States complete their RFP plans as

soon as possible after designation to

provide more time for sources to

implement the emissions reductions.

6. How should CAA restrictions on

creditable measures be interpreted?

Which national measures should count

as generating emissions reductions

credit toward RFP requirements?

All emissions reductions that occur

after the baseline emissions inventory

year are creditable for purposes of the

RFP requirements in this section except

as specifically provided in section

- 182(b)(1)(C) and (D) and section

182(c)(2)(B) of the CAA which exclude

four categories of emissions reductions

requirements required to be adopted

prior to 1990.

7. For areas covered only by subpart 1,

how should the RFP requirement be

structured?

We are finalizing rules for two rather

than three categories of areas based on

the CAA's division of attainment dates

for subpart I areas under section

1.72(a)(2). The following are the two

scenarios and the RFP requirements for

each:

Scenario A: Areas with attainment

dates 5 years or less after designation

(i.e., for most areas on or before June 15,

2009). Reasonable further progress for

these areas would be met by ensuring

emissions reductions-needed for

attainment are implemented, as noted

above, by the beginning of the ozone

season prior to the attainment date. This

would be similar to subpart 2 RFP for

areas classified as marginal.

Scenario B: Areas with attainment

dates beyond 5 years after designation

(i.e., beyond 2009).

* The RFP plan must show

increments of progress from the baseline

emissions inventory year out to the

attainment date.

* The RFP SIP would first have to

provide for a 15 percent emission

reduction from the baseline year within

6 years after the baseline year (i.e., out

to 2008).

* The 15 percent RFP SIP would have

to be submitted within 3 years after

designation (i.e., in 2007).

.* Either NOx or VOC emissions

reductions (or both) could be used to

achieve the 15 percent emission

reduction requirement.

* For each subsequent 3-year period

(after 2008) out to the attainment date,

the RFP SIP would have to provide for

an additional increment of progress no

less than the amount of emissions

reductions that would be roughly

proportional to the time between the

end of the first increment (in 2008) and

the attainment date. This second RFP

SIP would also have to be submitted

within 3 years after the effective date of

designation (i.e., in 2007).

8. Where part of an 8-hour

nonattainment area was a 1-hour

nonattainment area with a ROP

obligation extending past 2002, can

emissions reductions from the area's 1-

hour ROP plan be used as credit toward

meeting the area's 8-hour RFP plan?

Where an area has both 1-hour and 8-

hour RFP obligations for the post-2002

period, the State may rely on emissions

reductions from the 1-hour plan in

achieving RFP for the 8-hour standard.

The State could develop a new baseline

and new RFP emission reduction targets

for the entire 8-hour standard

nonattainment area (i.e., the old 1-hour

standard nonattainment area and any

newly added portion of the 8-hour

standard nonattainment area).

Emissions reductions from measures in

the ithour ozone SIP that are achieved

after the 8-hour ozone NAAQS baseline

year could count (subject to creditability

restrictions as discussed above) toward

meeting the RFP requirement for the

entire 8-hour area. This approach would set an RFP

target for the entire 8-hour ozone

nonattainment area. Under this

approach,' the new RFP target for the 8-

hour standard would replace the

previous 1-hour ROP target (while

ensuring that, at a minimum, the

emissions reductions required-to meet

the old target are met; see 40 CFR

51.905(a)(1)(iii)).

9. Will EPA's "Clean Data Policy" apply

-for purposes of 8-hour RFP, attainment

demonstrations and other related

requirements?

We intend to apply the Clean Data

Policy, which we had applied under the

1-hour standard, for purposes of the 8-

hour standard. In this action EPA is

finalizing the statutory interpretation

that is embodied in the policy. The text

of the final rule encapsulates the

statutory interpretation set forth in the

policy.

10. How will RFP be addressed in Tribal

areas?

We intend to follow the Tribal

Authority-Rule (TAR), which provides

Tribes with the ability to develop Tribal

implementation plans (TIPs) to address

and implement the NAAQS in Indian

country. It further provides the Tribes

with flexibility to develop these plans in

a modular way, as long as the 6lements

of their TIPs are reasonably "severable."

11. How will RFP targets be calculated?

Appendix A to the preamble to this

final rule provides calculation

procedures for determining the RFP

targets. These have been revised from

those in the proposal to account for NOx

and for emissions models in addition to

the MOBILE model.

12. Should EPA continue the policy of

allowing substitution of controls from

outside the nonattainment area within

100 kilometers for VOC and 200

kilometers for NOx?

We intend to continue to rely on this

policy at the current time. The use of

emissions reductions outside the

nonattainment area must be shown to be

beneficial toward reducing ozone in the

nonattainment area and must ensure

that the reductions meet the standard

tests of creditability (permanent,

enforceable, surplus, and quantifiable).

13. When must RFP emissions'

reductions be achieved?

The target level of emissions must be

met by the attainment date of the

attainment year. Section 182(c)(2)(B)

requires that RFP be continued out to

the attainment date.

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14. Banked emission reduction credits

(including shutdown credits): Can prebaseline emission reduction credits'be

used to satisfy the RFP requirement?

* The baseline emissions should not

include pre-enactment banked emission

credits since they were not actual

emissions during the calendar year of

enactment of the CAA Amendments of

1990.

* Banked emissions reductions

credits created prior to enactment of the

CAA Amendments of 1990 are not

creditable toward the 15 percent

progress requirement. However, for

purposes of equity, EPA encourages

States to allow sources to ue such

banked emissions credits for offsets and

netting as authorized.

e When States use such banked

credits for offsets and netting to the

extent otherwise creditable under the

part D NSR regulations, these preenactment emissions credits must be

treated as growth. Prior guidance on this

issue is still relevant for banked

emission reduction credits in relation to

the RFP requirement for the 8-hour

ozone standard. However, because the

rule for implementing the 8-hour ozone standard uses a 2002 baseline year, the

prior guidance should be interpreted

with that baseline in mind instead of

enactment of the CAA Amendments of

1990.

F. Are contingency measures required in

the eveiit of failure to meet a milestone

or attain the 8-hour ozone NAAQS?

Contingency measures are required to

be implemented in the event of failure

to meet a milestone or attain the 8-hour

ozone NAAQS and must accompany the

attainment demonstration SIP. All

subpart 1 and subpart 2-areas other than

marginal areas need contingency

measures.

G. What requirements should apply for

RACM and RACT for 8-hour ozone

nonattainment areas?

1. Reasonably Available Control

Technology (RACT)

For subpart 1 areas that submit a

demonstration of attainment for 5 or less

years after designation (i.e., do not

request an attainment date extension

beyond 5 years after designation), the

CAA's RACT requirement is met with

the control requirements associated

with a-demonstration that the NAAQS

is attained as expeditiously as

practicable.

For subpart 1 areas that submit an

attainment demonstration that requests

an attainment date extenskmn (i.e.,

beyond 5 years afte' desfgnation),

subpart 2 moderate and above areas,-and

areas within an Ozone Transport Region

(OTR), a RACT SIP is required covering

CTG sources and major non-CTG

sources. The RACT submittal date is 27

months after designation, except a

subpart I area shall submit the RACT

SIP with its attainment date extension

request. 2 States must require sources to

implement RACT no later than the first

ozone season or portion thereof which

occurs 30 months after the required

submittal date.

Where a RACT SIP is required, State

SIPs implementing the 8-hour standard

generally must assure that RACTis met,

either through a certification that

previously required RACT controls

represent RACT for 8-hour

implementation purposes or through a

new RACT determination. States may

use existing EPA guidance in making

RACT determinations. The State need.

not perform a NOx RACT analysis for

sources subject to the State's emission

cap-and-trade program where the cap-.

and-trade program has been adopted by

* the State and approved by EPA as

meeting the NOx SIP Call requirements

or, in States achieving CAIR reductions

solely from electric generating units

(EGUs), the CAIR NOx requirements..3

States are free to conduct case-by-case

RACT determinations, or RACT

determinations or certifications for

groups of sources, at their discretion.

2. Reasonably Available Control

Measures (RACM)

For each nonattainment area required

to submit an attainment demonstration,

the State must submit with the

attainment demonstration a SIP revision

demonstrating that it has adopted all

control measures necessary to

demonstrate attainment as expeditiously

as practicable and to meet any RFP

requirements.

H. How will the section 182(f) NOx

provisions be handled under the 8-hour

ozone standard?

The final rule allows a person to

petition the Administrator for an

exemption from nonattainment major

NSR and/or RACT requirements for

major stationary sources of NOx in 8-

hour ozone nonattainment areas and for

any area in a section 184 ozone

transport region. The final rule includes

an extension of the NOx waiver

provisions to 8-hour ozone

nonattainment areas covered under

2 This is generally expected with the submission

of the attainment demonstration. 3

Alternatively, a State need not perform a NOx

RACT analysis for s6urces subject tW Federal.

implementation plan that implements the emission

reductions required by the NOx SIP. call or the

CAIR.

subpart 1 (as proposed) as well as.

subpart 2 nonattainnient aras. In

addition, the final rule states that a

section 182(f) NOx exemption granted

under the 1-hour ozone standard does

not relieve the area from any

requirements under the 8-hour ozone

standard. A petition must contain

adequate documentation that the

exemption provisions in section 182(f)

are met. We recently issued updated

guidance on appropriate documentation

regarding section 182(f) forapplication

to the 8-hour ozone program.

4

I. Should EPA promulgate a NSR

provision to encourage development

patterns that reduce overall emissions?

Section V of this preamble below

addresses rules for NSR for the 8-hour

ozone standard. We are not at this time

issuing any rule related to Clean Air

Development Conmunities (CADCs).

J. How will EPA ensure that the 8-hour

ozone standard will be implemented in

a way which allows an optimal mix of

controls for ozone, fine particulate

matter PM2 .5), and regional haze?

We are continuing our policy of

encouraging each State with an ozone

nonattainment area which overlaps or is

nearby a PM2.5 nonattainment area to

take all reasonable steps to coordinate

the required revisions for these

nonattainment areas and meet

reasonable progress goals for regional

haze.

K. What emissions inventory

requirements should apply under the 8-

hour ozone NAAQS?

Existing ozone-relevant emissions

data element requirements under 40

CFR 51 subpart A are sufficient to

satisfy the emissions inventory data

requirements under the 8-hour ozone

NAAQS.

L. What guidance should be provided

that is specific to Tribes?

Section 301(d) of the CAA recognizes

that American Indian Tribal

governments are generally the

appropriate authority to implement the

CAA in Indian country. As discussed in

the TAR, it is appropriate to treat Tribes

in the same manner as States for

purposes of implementing all of the

provisions of the CAA, except those

provisions for which EPA has

specifically determined that it is not

appropriate to treat Tribes in the same

4 Memorandum dated January 14, 2005,

"Guidance on Limiting Nitrogen Oxides (NOx)

Requiiements'R6lated to 8-Hour'Ozone -

Implementation" from Stephen D. Page, Director,

Office of Air, Quality Planning and Standals, to Air

Directors, Regions I-X.

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manner as States. (The CAA provisions

for which EPA has determined it is not

appropriate to treat Tribes in the same

manner as States are listed in section

IV.L. of this preamble.) Examples of

CAA provisions for which EPA has

determined it is, not appropriate to treat

Tribes in the same manner as States

include specific plan submittal and

implementation deadlines.

In implementing this rule, it is

important for both States and Tribes to

work together to coordinate planning

efforts. Other than in very limited

circumstances, State regulations do not

apply to .Indian Country, but SIP control

measures could impact downwind

areas, including Indian communities. In

addition, nonattainment area

boundaries may include a portion of

Indian Country. Coordinated planning

will help ensure that the planning

decisions made by-the States and Tribes

complement each other and achieve •

progress toward meeting the NAAQS.

M. What are the requirements for Ozone

Transport Regions (OTRs) under the 8-

hour ozone standard?

Section 184 continues to apply for

purposes of the 8-hour standard;

therefore, the current OTR remains in

place and the section 184 control

requirements continue to apply for'

purposes of the "8-hour standard. If a

new OTR is established for purposes of

the 8-hour standard pursuant to section

176A, that area would also be subject to

the provisions and additional control

requirements of section 184.

N. Are there any additional

requirements related to enforcement

and compliance?

We are not setting forth any

additional rule related to compliance

and enforcement:

0. What requirements should apply to

- emergency episodes?

We have not yet proposed any rule

revision related to emergency episodes

(at 40 CFR part 51, subpart H), and the

final rule below does not contain any

such rule revision.

P. What ambient monitoring

requirements will apply under the 8-

hour ozone NAAQS?

No monitoring requirements are beifig

promulgated as part of this rulemaking.

The preamble discusses current relevant

requirements (40 CFR part 58) and

anticipated activities.

Q. When will EPA require 8-hour

attainment demonstration SIP

submissions?

Modeled attainment demonstrationswhere required-must be submitted

within 3 years after the effective date of

the area's nonattainment designation.

R. How will the statutory time periods

in the CAA be addressed when we

redesignate areas to nonattainment

following initial designations for the 8-

hour NAAQS?

For any area that is initially

designated attainment or unclassifiable

for the 8-hour NAAQS and subsequeritly

redesignated to nonattainment for the 8-

hour ozone NAAQS, the attainment date

and dates for submittal of any

applicable requirements under subpart 1

or subpart 2 and these regulations

would run from the date of

redesignation to nonattainment for the

8-hour NAAQS.

Summary of Section V (Below): EPA's

Final Rule for New Source Review

In today's action;,we are finalizing'

previously proposed changes to three

regulations that govern major NSR

permitting of major stationary sources in

nonattainment areas---40 CFR 51.165,

appendix S of 40 GFR part 51, and 40

CFR 52.24.:." %1,7"

.The regulations at 40 CFR 51.165

contain the minimum elements that a

State's preconstruction permitting

program for major stationary sources in

nonattainment areas must contain in

order for EPA to approve the State's

program into the SIP. In § 51.165, we are

making revisions to'incorporate the

major stationary source thresholds,

significant emission rates, and offset

ratios pursuant to-part D of title I of the

CAA, as amended in 1990, for the 8-

hour ozone NAAQS, the CO NAAQS,

and the PM10 NAAQS. We are also

promulgating final changes to the

requirements for emissions reductions

achieved from shutdowns or

curtailments at § 51.165(a)(3)(ii)(C). We

are not currently acting on any other

proposed changes to 40 CFR 51.165.

Appendix S of 40 CFR part 51

contains the preconstruction permitting

program that applies to major stationary

- sources in nonattainment areas lacking

an approved part D NSR program. It

applies during the' interim period after

EPA designates an area as

nonattainment, but before EPA approves

a SIP to implement the nonattainment

NSR requirements for that pollutant (SIP

development period). We are making :

,the 'sam changes to apperidik S that we

are making to § 51.165 to implement the'

CAA as rbised by'!the 199.0'

Amendments. In addition, we are

finalizing revisions to sectioriVI'of'

appendix S to qualify applicability of

this section. This revision is an

outgrowth of the proposed revisions to section VI in the 8-hour NAAQS . .implementation proposal (68 FR 32802).

We also are removing an outdated

exemption for sources increasing

emissions less than 50 tons per year S(tpy). '

The regulations at 40 CFR 52.24

contain restrictions on the construction

or modification of major stationary

sources, including a construction ban

applicable in circumstances enumerated

-by the 1977 CAA. These regulations also

apply if the Administrator determines

pursuant to CAA section 173(a)(4) that

the State.is not adequately

implementing the SIP for meeting the

part D requirements. today's final rules

codify requirements of the 1990 CAA

Amendments related to the applicability

of construction bans. The final rules at

§ 52.24 also codify that § 51.165 applies

in interpreting the terms in § 52.24. The

regulations at 40 CFR 52.24(k) retain the

requirement that appendix S governs

permits to construct and operate applied

for during the period between the date

of designation as nonattainment and the

date the part D plan for NSR is

approved, but is updated to remove the

reference-to-the construction ban.

In-addition to the changes to the

nonattainment NSR regulations, we also

are making one change to the PSD

regulations under part C of title I of the

CAA. We are codifying NOx as an ozone

precursor in attainment and

unclassifiable areas.

Summary of.Section VI (Below): Final

Rule for RFG

.Today's, rule specifies that the nine

original RFG mandatory areas must

continue to use RFG at least until they

are redesignated to attainment for the 8-

hour standard. Similafly, areas that have

been reclassified as severe areas under

section 181(b) of the CAA for the 1-hour

NAAQS, and which were not

redesignated to attainment for the 1-

hour NAAQS prior to its revocation,

must continue to use RFG at least until

they are redesignated to attainment for

the 8-hour,standard. The EPA is

reserving for future consideration what

RFG requirements apply to areas that

were reclassified as severe under the 1-

hour standard, but were redesignated to

attainment for that standard before its

revocation. The only such area that was

redesignated to attainment prior to

revocation of the '1-hour standard is

Atlanta, Georgia. The EPA is- also*

reserving for future consideration

whether areasmfiust continue using RFC

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after they are redesignated to attainment

for the 8-hour standard, for the original

nine mandatory areas as well as the

areas reclassified to severe. Finally, EPA

clarifies that the current opt-in rules

will remain in place after the 1-hour

standard is revoked. Areas classified

under subpart 2 as marginal or above are

eligible to opt-in to the RFG program.

Summary of Section VII (Below): Other

Considerations

A. How will EPA's implementation of

the 8-hour ozone NAAQS affect funding,

under the Congestion Mitigation and Air

Quality Improvement (CMAQ) Program?

This section describes the

relationship between the CMAQ

program and the 8-hour ozone NAAQS

implementation program.

B. What is the relationship between

implementation of the 8-hour standard'

and the CAA's title V permits program?

The interrelationship between

implementation of the 8-hour ozone

standard and the title V permits

program was not discussed in the

proposed rule. However, various

questions have been raised about the

interface between the implementation of

the 8-hour ozone standard and the title

V operating permits program. The

preamble presents several questions and

answers, mainly dealing with how title

V applicability is affected by the new 8-

hr ozone standard and the revocation of

the 1-hour ozone standard.

C. What action is EPA taking on the

Overwhelming Transport Classification

for subpart 1 areas?

We are not completing rulemaking on

the overwhelming transport

classification in this rulemaking. This

section discusses the status of the

rulemaking.

IV. Final Rule for Phase 2 Elements

Other Than New Source Review and

Reformulated. Gasoline

The discussion of many of the

regulatory elements below address

timing of required actions, such as

submission dates for SIP revisions. The

discussion is primarily directed toward

8-hour ozone nonattainment areas for

which the effective date of the

designation was June 15, 2004.

However, a number of areas may have

later effective dates for their

designations, such as early action

compact areas and areas subsequently

redesignated from attainment to

nonattainment for the 8-hour ozone

standard. For these situations, the

timing will run from the effective date

of those designations. In cases in this

preamble where we have used June 15,

2004 as a substitute for the "effective

date," we are using it only for purposes

of those areas with an effective date of

June 15, 2004.

A. Should prescribed requirements of

subpart 2 apply in all 8-hour

nonattainment areas classified under

subpart 2, or is there flexibility in

application in certain narrowly-defined

circumstances?

[Section VI.D. of June 2, 2003

proposed rule (68 FR 32825); no draft or

final regulatory text.]

1. Background

The 1990 CAA Amendments

overhauled the CAA's requirements for

ozone nonattainment areas and, in

doing so, specified new mandatory

measures for many areas. The approach

embodied in subpart 2 was to classify

areas according to the severity of their

pollution. Areas with more serious

ozone pollution were given a higher

classification that did two things. First,

the successively higher classifications

provided a successively longer

maximum timeframe for attaining the

ozone NAAQS. Second, each higher

classification mandated specific

additional and/or more stringent

obligations than the classification

immediately below. Specifying

mandatory measures in the statute was

necessary because States and EPA, prior

to 1990, had failed to ensure that SIPs

achieved steady reasonable'progress in

reducing emissions or to require readily

available measures that were cost

effective and necessary to meet the

standard. See generally H.R. Rep. No.

101-490 at 144-48 (1990).

For this rule, we examined the issue

of mandatory measures from both a legal

and policy standpoint. Our legal view is

guided by the statutory language in part

D of title I of the CAA. In addition, we

were guided by the Supreme Court's

view of this language. Our policy view

is guided by past precedents and also

the principles we set forth in our

proposed rule (June 3, 2003; 68 FR

32802).

We have consistently interpreted the

CAA to mean that once an area is

classified under subpart 2, the subpart

2 requirements apply. While certain

requirements allow for some flexibility

in how they apply, the requirements do

not allow for broad waivers. For

example, all areas classified as serious

or above must meet the requirement for

an enhanced inspection.and

maintenance (I/M) program, however,

there is some flexibility in determining

what type of I/M program meets the

requirement for an enhanced I/M

program. The Supreme Court, in

addressing whether the classification

provisions in subpart 2 applied for

purposes of the 8-hour ozone NAAQS

found that they did and stated that

EPA's implementation scheme, which

would have avoided classifications

under subpart 2, was unreasonable

because it would effectively nullify the

subpart 2 provisions that Congress

created with the intent to limit State and

EPA discretion. Whitman v. American

Trucking Assoc., 531 U.S. 484-85.

In the proposed rule, we recognized

that there is case law doctrine that

might allow a case-by-case waiver from

mandatory requirements when

sufficient evidence is presented that

application of a specific requirement in

a particular area would cause absurd

results.

2. Final Rule

We continue to interpret the CAA to

mean that the prescribed requirements

for each classification under subpart 2

apply to areas with such classification

for the 8-hour NAAQS. As we noted in

the preamble to the proposed rule, there

may be a basis for waiving a prescribed

requirement on a case-by-case basis

where imposition of the requirement

would create an absurd result. However,

as stated in the proposed rule, we

believe that absurd results that might

occur from application of mandatory

control measures would happen only in

rare instances, If a State submits a

demonstration that application of a

specific requirement in a specific

nonattainment area would create an

absurd result, we will consider

application of the absurd results

doctrine at that time.

3. Comment and Responses

Comment: A number of commenters

supported the approach that we

discussed in the proposed rule. Other

commenters agreed with the overall

concept that we proposed but felt that

we should take additional factors into

consideration if we make case-by-case

waivers from subpart 2 requirements.

Several commenters suggested that we

take the cost of controls into

consideration when determining if there

were an absurd result while others

suggested that we look at relative

control strategy effectiveness, e.g.,

allowing a demonstration that NOx

reductions are more effective and

therefore may be substituted for

mandatory VOC emissions reductions.

Several other commenters.stated that

we should more broadly allow

substitution of subpart 2 mandatory

measures. One commenter felt that

substitution of subpart 2 measures

should be allowed as long as the

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substituted measures are at least

equivalent to the mandatory measures..

Another commenter stated that we

should allow areas to adopt substitute

measures in lieu of subpart 2 measures

where the subpart 2 measures would not

be as effective as the substitute

measures in reaching attainment. The

commenter stated that we have been

overly limited in our characterization of*

when subpart 2 measures might be

waived to avoid an absurd result. The

commenter believed that we should

create a categorical exemption as an

exercise of agency power to allow areas

to substitute NOx for VOC measures or

more effective control measures for less

effective control measures when doing

so would expedite attainment. Another

commenter urged us to limit the strict

application of subpart 2 measures

because the imposition of such

measures creates economic

disincentives for companies to locate

and expand in nonattainment areas. A

number of commenters stated that they

do not support the vehicle I/M or Stage

II vapor recovery programs and

recommended that we provide States

-with flexibility in meeting these

requirements.

Response: Many of the .commenters'

suggestions go beyond the application of

an absurd results doctrine and instead

suggest broad waiver of subpart 2

requirements based on a determination

that an alternative or substitute is more

effective. Wedo not believe that we

have the authority to broadly waive

measures mandated by Congress. As

noted by the Supreme Court, Congress

intended to cabin States' discretion

when it mandated the specific controls

under subpart 2. See e.g., Whitman, 531'

U.S. 484-85. ("Whereas subpart 1 gives

EPA considerable discretion to shape

nonattainment programs, subpart 2

prescribes large parts of them by law"

and "EPA may not construe the statute

in a way that completely nullifies

textually applicable provisions meant to

limit discretion.").

However, as stated in our proposed

rule, we believe that case law may

provide EPA with limited flexibility to

waive federally mandated requirements

on a case-by-case basis where

-application of those requirements would

produce an absurd result. We do not

need to conclude here what precise

circumstances would create an absurd

result. Rather, that decision would need

to be made on a case-by-case basis in the

context of a specific request. In general,

we note that to demonstrate an absurd

result, a State would need to

demonstrate that application of the

requirement would result in more harm

than benefit. For example, the programs

mandated under subpart 2 are generally

effective in reducing emissions of the

two ozone precursors-NOx and VOCand because reductions of those

precursors generally lead to improved

air quality, we believe that such a

demonstration could be made, if at all,

only in rare instances.

With regard to the comment relating

to, Stage II vapor recovery, section

202(a)(6) of the CAA does provide for

revision or waiver of the Stage II vapor

recovery requirement under certain

conditions: "The requirements of

section 182(b)(3) (relating to stage II

gasoline vapor recovery) for areas

classified under section 181 as moderate

for ozone shall not apply after

promulgation of such standards and the

Administrator may, by rule, revise or

waive the application of the

requirements of such section 182(h)(3)

for areas classified under section 181 as

Serious, Severe, or Extreme for ozone, as

appropriate, after such time as the,

-Administrator determines that onboard

emissions control systems required

under this paragraph are in widespread

use tlfroughout the motor vehicle fleet."

Currently, EPA is formulating policy

concerning how widespread use will be

determined and has been ieeking

participation from affected parties.

Further information is available at:

http://www.epa.gov/ttn/naaqs/ozoneozonetech/stage2/.

Comment: A few commenters

disagreed with the approach in our

proposed rule. One commenter stated

that we do not have the statutory

authority to create new waivers to

subpart 2 requirements. Another

commenter stated that the CAA does not

allow case-by-case waivers to avoid

"absurd" results. The commenter

further stated that doing so would in

effect require us to rewrite'the statute by

regulation.

Response: As stated above, we agree

that we do not have broad authority to

waive subpart 2 requirements and that

the CAA itself does not expressly create

authority to waive such requirements.

However, the "absurd results" line of

cases provides that where application of

a statute as written would create a result

counter to what Congress intended, an

Agency has limited authority to

construe that provision in a manner

than would effectuate Congress' intent.5

- See Holy Trinity Church v. United States, 143

U.S. 457 (1892).("If literal construction of the words

of a statute be absurd, the Act must be so construed

to avoid the absurdity."); Griffin v. Oceanic

Contractors, Inc. 458 U.S. 564 (1982) (recognizing

the absurdity exemption, but concluding that a

harsh penalty provision did not produce results

counter to Congress' intent); Mova Pharm. Corp. v.

Shalala, 140 F. 3d 1060 (D.C. Cir. 1998) (recognizing

B. How will we address long-range

transport of ground-level ozone and its

precursors when implementing the 8-

hour ozone. standard?.

[Section VI.F. of June 2, 2003

proposed rule (68 FR 32827); no draft or

final regulatory text.]

1. Background

Interstate transport can make it

difficult or impossible for some-States to

meet attainment deadlines for areas

within their boundaries solely by

regulating sources within their own

boundaries. Section 110(a)(2)(D) of the

CAA provides an important tool for

addressing the problem of interstate

transport. It provides that a State must

include adequate provisions in its SIP to

prohibit sources within the State from

emitting air pollutants in amounts that

contribute significantly to

nonattainment, or interfere with

maintenance, in one or more downwind

States. Section 110(k)(5) of the CAA

authorizes EPA to find that a SIP is

substantially inadequate to meet any

CAA requirement, including the

requirements of section 110(a)(2)(D) of

the CAA. If we make such a finding, we

must require the State to submit, within

a specified period, a SIP revision to

correct the inadequacy. The CAA

further addresses interstate transport.of

pollution in section 126, which

authorizes any State to petition EPA to

regulate emissions from significant

upwind sources of air pollutants in

other States.

In addition to requiring States to

control interstate air pollution under

section. 110(a)(2)(D), the CAA requires

States with'nonattainment areas to

develop State plans under part D that

provide for meeting the NAAQS as

expeditiously as practicable, and for

maintaining healthy air quality in those

areas over time. Together, the section

110(a)(2)(D) and part D provisions

provide for upwind State and in-State

controls to ensure that national healthbased air quality standards are met and

maintained.

2. Current Approach

In the NOx SIP Call-Rule, EPA found

the SIPs for certain States in the eastern

U.S. to be substantially inadequate to

address emissions transported to

downwind States and required those

States to select and adopt control -

measures to meet statewide ozoneseason NOx emissions budgets based on

highly cost-effective _NOx emissions

the absurdity exemption, but finding that a

"successful defense" regulation went beyond the

statute was not necessary to meet Congressional

intent.)

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reductions (63 FR 57356, October 27,

1998.) In that rule, we determined that

the same level of emissions reductions

was needed to address transport for both

the 1-hour and 8-hour standards.6

The NOx SIP Call Rule is achieving

substantial emissions reductions and air

quality improvement well in advance of

the attainment dates of 8-hour

nonattainment areas. In the eastern

United States, monitoring data shows a

10.percent improvement between 2002

and 2004 in the seasonal (MaySeptember) average of daily maximum

8-hour ozone concentrations, after

adjustment for meteorological

differences. The EPA believes that the

NOx reductions achieved as a result of

the NOx SIP Call are an important factor.

in this improvement. The compliance

date for achieving the required NOx

reductions under phase I of the NOx SIP

Call was May 31, 2004. All of the 19

affected States and the District of

Columbia submitted complete Phase I

SIPs, which EPA approved, in response

to the NOx SIP Call and are . implementing their NOx control

programs. State programs to implement

the rule have focused on reducing

emissions from electric power

generators and large industrial emitters.

The phase II NOx SIP Call Rule, which!

responds to court decisions on issues

from the original SIP call rule involving

certain types of sources and geographic

coverage, requires additional emissions

reductions by May 1, 2007.

The EPA's modeling for the CAIR

indicates that ozone levels across the

eastern half of the country will improve

substantially by 2010 because of

existing requirements-including the

NOx SIP call, federal motor vehicle and

nonroad engine regulations, and other

existing State and federal rules. Last

year, EPA designated more than 100

areas in that region as having ozone

levels not meeting the 8-hour ozone

standard, based on 2001-2003 data. Air

quality improvements due to existing

requirements (i.e., without State

measures required for areas designated

nonattainment for the 8-hour standard)

are projected to leave only 16 of these

areas in nonattainment in 2010. This

estimate is derived from base case CAIR

modeling results shown in the final

notice for the CAIR (70 FR 25254, Table

VI-12).

On May 12, 2005, EPA published the

Clean Air Interstate Rule in the Federal

Register (70 FR 25162). The EPA

determined that 28 States and the

District of Columbia contribute

6 In light of various challenges to the 8-hour

NAAQS, we stayed the 8-hour basis for the NOx SIP

Call Rule (65 FR 56245; September 18, 2000).

significantly to downwind

nonattainment, or interfere with

maintenance, of the PM2.5 and 8-hour

ozone NAAQS in other States. The rule

requires these States to submit SIP

revisions to reduce SO 2 and/or NOx

emissions.

To reduce interstate ozone transport,

the rule established statewide ozoneseason NOx budgets for 25 States and

the-District of Columbia. The budgets

are based on the level of emissions that

can be achieved through highly costeffective controls that EPA determined

are available from EGUs; however,

States have flexibility to choose the

measures they will use to achieve the

necessary emissions reductions. Due to

feasibility constraints, EPA is requiring

the CAIR budgets to be achieved in two

phases. For summertime NQx, the first

phase starts in 2009 (covering 2009-

2014); 7 the second phase of NOx

reductions beginb in 2015 (covering

2015 and thereafter).

The 25 States that are required to

meet a summertime NOx cap for ozone

purposes, along with the District of

Columbia, are Alabama, Arkansas,

Connecticut, Delaware, Florida, Illinois,

Indiana, Iowa, Kentucky, Louisiana,

Maryland, Massachusetts, Michigan, •

Mississippi, Missouri, New Jersey, New

York, North Carolina, Ohio,

Pennsylvania, South Carolina,

Tennessee, Virginia, West Virginia, and

Wisconsin.

The CAIR is geographically broader

and more stringent than EPA's previous

ozone interstate transport rule, the NOx

SIP Call, adopted in 1998.8 The CAIR's

ozone requirements are based on

updated analyses of the impacts of

pollution transported across State

borders, and of highly cost-effective

control opportunities for NOx.

As detailed in the final CAIR action,

the CAIR rule will further reduce ozone

transport to assist States in their efforts

to bring ozone nonattainment areas into

attainment or-in the case of downwind

receptor areas that.attain prior to some

or all'CAIR reductions-maintain air

quality meeting the 8-hour ozone

NAAQS. In the CAIR rulemaking, EPA

projected that 39 counties (in the 16

nonattainment areas referenced above)

would have ozone levels exceeding-the

7 The CAIR first phase also provides an annual

NOx budget, which also starts in 2009.

8 The CAIR requires summertime NOx reductions

in the following States not covered by the NOx SIP

Call: Arkansas, Florida, Iowa, Louisiana,

Mississippi, and Wisconsin. The NOx SIP Call has

requirements for two States not covered by CAIR

ozone requirements: Rhode Island and Georgia. The

EPA has proposed a stay of applicability of the SIP

Call to Georgia as an initial response to a petition

for reconsideration on whether Georgia should be

covered.

standard in 2010 in the absence of

further control requirements (i.e., the

base case without CAIR). Most of these

counties. were projected to be within a

few parts per billion (ppb) of the

standard. For the 39 counties, the'

average reduction in ozone levels

estimated from 2009 CAIR NOx controls

is 0.4 ppb, and the maximum

improvement is 1.4 ppb (70. FR 25254,

Table VI-12.) The 2009 CAIR NOx

requirements will achieve reductions

prior to the maximum attainment date

for downwind 8-hour ozone areas

classified as moderate.

We believe that States will be able to

demonstrate timely attainment for most

8-hour ozone nonattainment areas with

the help of emissions reductions from

Federal )rules. However, we also believe

that a limited number of downwind

areas, while showing improvement, are

likely to remain in nonattainment after

2009. This is due to the severity of

projected ozone levels in certain areas,

uncertainties about the levels of

emissions reductions that will actually

occur, and persistence of historical

difficulties with attaining the 1-hour

ozone standard. The EPA determined in

the CAIR that even if all downwind

receptor areas attained on time, many

areas will remain close enough to the

standard to be at risk of falling back into

nonattainment. The EPA concluded that

the 2015 summertime NOx reductions

will assist attainment and maintenance

of the 8-hour standard. 9

In addition to controlling. interstate air

pollution under section 110(a)(2)(D),

EPA national rules and State rules for

controlling.local sources of em issions

are significantly reducing, and in the

future will further reduce, the amount of

pollution transported to 8-hour ozone

nonattainment areas in downwind

States. Downwind States, in devising

their attainment and maintenance plans,

will be able to take required upwind

reductions into account. Depending on

the particular area, thd upwind"

reductions will help to hasten

attainment of the NAAQS, make

attainment and maintenance of the

NAAQS less difficult and costly, or

both.

The EPA notes that interstate

pollution transport will be furthei

reduced through cost-effective measures

that individual States adopt for

purposes of bringing their ozone

9 For the 22 counties projected to be in

nonattainment in 2015 in the absence of further

control requirements (i.e., the CAIR base case), the

average ozone reduction in 2015 from CAIR is 1.1

ppb, and the maximum improvement is 1.6 ppb. (70

FR 25254, 25455, Table VI-13.j

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nonattainment areas into attainment.10

Given the potential for measures

adopted by one State to improve air

quality downwind, EPA is supportive of

multi-State cooperation on strategies for

attaining the 8-hour standard.

3. Comments and Responses

This section addresses the more

significant comments receiived; the

response to comment document

addresses other comments also.

Comment: Several commenters

thought the June 2, 2003, 8-hour

implementation proposal failed to

adequately address transport and

disagreed with our statement that 8-

hour transport has been addressed up

front by the NOx SIP Call. Some added

that this-puts northeastern States

located in the OTR in a situation wlere

their citizens and businesses are bearing

a disproportionate burden of health arid

economic impacts compared to upwind

States that have fewer control

requirements than OTR States. Some

OTR State commenters said that the rule

should address this inequity. One said

we cannot assume that transport has

been addressed until after the NOx SIP

Call is implemented and has been

evaluated.

. Response: The 8-hour ozone

implementation rule is not intended as

a rule to address interstate transport of

pollution and to achieve emissions.

reductions from upwind sources as

provided under CAA section

110(a)(2)(D). Rather, its purpose is to

interpret nohattainment requirements

(in subparts 1 and 2 of part D of title I)

for State plans to implement the 8-hour

NAAQS. We have addressed the section

110(a)(2)(D) obligation through the NOx

SIP Call and CAIR, which provide

substantial air quality benefit for

downwind areas significantly affected

by transport of pollution from other

States.

Comment: Two commenters

recommended a regional approach

among States to address transport. One

commenter thought that Clear Skieg is

the best way to address transport, but

absent that, would support a regional

approach. Some commenters thought

the 8-hour ozone implementation

proposal ignored the issue that ozone is

a regional problem that can only be

solved through regional planning. Thesb

commenters added that instead of

incentives for regional planning there

were disincentives. Another commenter

thought that EPA unrealistically expects

10 Many types of sources contribute to ozone

transport. The CAIR reduction requirdments are

based solely upon potential reductions from EGUs;

EPA did not find other source types highly cost

effective to control.

States to be able to resolve all potential

conflicts between the States by Working

together in a collaborative process to

identify and adopt appropriate controls

that provide for attainment. The

commenter suggested that EPA

oversight may be necessary in these

situations. One commenter thought the

development of multiple OTRs for

regional planning and coordination may

be highly desirable to bring States with -a common problem together to

coordinate efforts with the strength of

several States rather than to go-it alone.

Another siuggested some criteria for EPA

to use if we were to choose to establish

OTRs.

Response: We believe that addressing

interstate transport requires regional

approaches and regional cooperation.

The EPA has ensured regional action to

reduce interstate ozone transport

through the NOx SIP Call Rule and

CAIR. In addition, we note that groups

of States have worked effectively

together in the past to address regional

ozone problems. For example, the Lake

Michigan Air Directors Consortium

(LADCO) was established in 1990 by the

States of Illinois, Indiana, Michigan, and

Wisconsin. The main purpose of

LADCO is to provide technical

assessments for and assistance to .its

member States on problems of ozone air

quality and to provide a forum for its

member States to discuss air quality

issues. We will continue to encourage

these multi-State efforts to assess and

address ozone nonattainment and will

work with these States as needed to

provide support and ensure progress.

We agree with other commenters that

States should work together in the SIP

development process to ensure localized

transport is addressed. States that share

an interstate nonattainment area are

expected to work together in developing

the nonattainment SIP for that area and

in reducing emissions that contribute to

local-scale interstate transport problems.

We would also encourage collaborative

efforts even in cases where there is not

a multi-State nonattainment area but

where significant emissions sources in

one State might affect air quality in a

nohattainment area in an adjacent State.

In response to comments suggesting

that EPA establish additional transport

regions, at this time we do not

anticipate formalizing any additional

transport regions. We believe that the

NOx SIP Call and CAIR rules go far to

effectively address the kind of transport

that establishment of a transport region

would be intended to address, without

the costs of setting up a commission to

oversee the transport region.

Comment: Some commenters stated

that we should not rely on the proposed

Clear Skies legislation to reduce

emissions transport because there is no

guarantee that the legislation will be

enacted. Several State commenters

added that Clear Skies would not

provide adequate or timely emissions

reductions. Another commenter

suggested that we work with Congress to

enact legislation to allow for the

development and use of a transport

argument in attainment demonstrations.

Response: While we still hope that

Congress will adopt the

-dministration's Clear Skies multipollutant legislation, we acknowledge

that the outcome of that process is

uncertain. To ensure that regional

transport is addressed in a timely

manner, EPA finalized the CAIR in May

2005 based on our existing regulatory

authority.

Comment: One commenter proposed

tat rather than addressing transport

through national measures, we could

include transport as one of the criteria

for determining the adequacy of a SIP.

This commenter supported the multiState collaborative effort mentioned in

the proposed rule, so that areas work

together to address transport as their

SIPs are being developed. The

commenter asserted that our proposed

early, top-down approach could

significantly hinder SIP planning for

local areas considering the complex

chemistry of ozone and PM2.5 formation.

Response: We believe that the NOx

SIP Call and CAIR help, rather than

hifider, SIP planning for nonattainment

areas. We agree that the CAA does allow

the States to work together in a

collaborative fashion to assess regional

or sub-national transport. The EPA

worked with a State-led effort in the

mid-to late-1990's [the Ozone Transport

Assessment Group (OTAG) process] to

perform such an assessment, which

documented the magnitude and extent

of long-range transport of ozone and its

precursors. At that time, EPA concluded

that without some certainty of what

levels of emission controls would be

required in the larger region States

faced great uncertainty regarding the

amounts of ozone and precursor

concentrations being transported into

the modeling domain of the

nonattainment area for which they were

required to develop their attainment

demonstrations. Therefore, EPA issued

the NOx SIP Call-and more recently,

CAIR-to establish the emission

reduction responsibilities of upwind

States under section 110(a)(2)(D). In this

way, eastern States could then have a

fair degree of certainty regarding

required upwind reductions and the

amount of transported emissions to be

assumed in their 1-hour ozone

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attainment demonstrations for

individual nonattainment areas. Based

on the OTAG experience, we believed

that there was high risk that States

working together in a collaborative,

fashion would not agree on a regional

control strategy within the time the

CAA provides for States to develop 8-

hour attainment demonstrations.

Therefore, we believe the commenter is

incorrect that the "top-down" approach

will significantly hinder SIP planning

for the individual areas, and on the

contrary, will provide the certainty

needed to complete the attainment

demonstrations in a timely manner.

The commenter also proposed that

rather than addressing transport through

national measures, We could include

transport as one of the criteria for

determining the adequacy of a SIP. It is

true that section 110(a)(2)(D)(i)(I)

requires a SIP to "contain adequate

provisions * * * prohibiting, consistent

with the provisions of this title, any

source or other type of emissions

activity within the State from emitting

any air pollutant in .amounts which

will-(I) contribute significantly to

nonattainment in, or interfere with

maintenance by, any other State with

respect to any such national primary or

secondary ambient air quality standard

* * " Furthermore, sections 110(a)(1)

and (2) of the CAA require States to

submit SIPs that implement, maintain,

and enforce a new or revised NAAQS

within 3 years of promulgation of the

standard. Among other things, these SIP

revisions must address aState's

significant contribution of pollution to

nonattainment and maintenance

problems in other States under sdction

110(a)(2)(D). On March 10, 2005, EPA

officially notified States that they have

failed to submit SIPs to satisfy this

requirement of the CAA with respect to

the 8-hour ozone and PM 2.

5 NAAQS (70

FR 21147; April 25, 2005). The finding

starts a 2-year clock for EPA to issue a

final Federal Implementation Plan (FIP)

that will address the requirements of

section 110(a)(2)(D) unless a SIP

revision correcting the deficiency is

approved by.EPA before the FIP is

promulgated. The EPA plans to issue

guidance regarding how States could

satisfy the section 110(a)(2)(D)

requirement. For States affected by

CAIR, an approved SIP responding to

the CAIR would satisfy the requirement

and turn off the FIP clock..

C. How will we address transport of

ground-level ozone and its precursors

for rural nonattainment areas, areas

affected by intrastate transport, and

areas affected by international

transport?

[Section VI.G. of June 2, 2003

proposed rule (68 FR 32828); no draft or

final regulatory text.] 11

1. Rural Transport Nonattaiiiment Areas

a. Background

In the June 2, 2003 proposal, we noted

that section 182(h) of the CAA (under

subpart 2) recognizes that the ozone

problem in a rural transport area is

almost entirely attributable to emissions

from upwind areas. This section

provides that the only requirements

applicable to an area classified under

subpart 2 that we determine is a rural

transport area are the minimal

requirements specified for marginal

areas, i.e., those areas expected to attain

within 3 years after designation. The

timing for attainment for these areas

will depend on the schedu'le for

adoption and implementation of control

measures in the upwind areas. We did

not propose any revision to current

policy and practices related to the rural

transport area provisions under section

182(h).

b. Summary of Final Rule

The final rule does not contain any

revisions to current policy on rural

transport areas under section 182(h).12

c. Comments and Responses

Comment: Several commenters

favored the proposed approach of not

revising our current policies with regard

to subpart 2 areas that meet the criteria

for being a rural transport area under

section 182(h).

Response: We agree with these

comments.

Comment: Several commenters urged

us to provide more flexibility such as

extending the provision to other areas whose problems are caused by transport

but that do not qualify as rural under

section 182(h).

Response: These commenters did not

suggest any legal mechanism for

"This section of the proposal also addressed

multi-State nonattainment areas. The discussion of

multi-State nonattainment areas is now covered

under the discussion below on attainmefit

demonstrations and modeling.

" Based on current information, we do not

believe there are any 8-hour nonattainment areas

covered under subpart 2 that are "rural" and

therefore eligible for consideration for coverage

under section 182(h). Existing policy on rural

transport areas includes the "General Preamble for

the Implementation of Title I of the Clean Air Act

Amendments of 1990; Proposed Rule," April 16,

1992 (57 FR 13505),

granting the flexibility provided under

section 182(h) to areas that do not

qualify as rural.under section 182(h).

We have not found any such legal

mechanism and, therefore, the final rule

does not extend the flexibility provided

under section 182(h) to additional areas.

2. Intrastate Transport

a. Background

In the proposed rule, we noted that a

number of State air agency

representatives had voiced concern

about intrastate transport of ozone and

precursor emissions and asked EPA to

address this concern. We indicated that

the CAA requires individual States, as

an initial matter, to deal with intrastate

transport. We also pointed out that a

State could recommend designation of

nonattainment areas that are large

enough to encompass upwind and

downwind areas of the State and require

that the individual jurisdictions work

together on an attainment plan that

accounts for transport and results in

attainment by the attainment date for

the entire nonattainment area. We also

solicited comments on other ways of

addressing intrastate transport within

the context of the CAA provisions.

b. Summary of Final Rule

The final rule does not contain any

additional provisions for addressing

intrastate transport for the reasons

stated in the proposal. However, as

indicated in the Phase 1 Rule published

on April 30, 2004, for subpart 1 areas,

States and EPA could consider intrastate

transport in determining the attainment

date for an area.13 In identifying the

appropriate attainment date for an area,

the State should consider measures to

address intrastate transport of pollution

from sources within its jurisdicti6n.

c. Comments and Responses

Comment: Two commenters

recommended that States have

regulatory authority to require controls

as necessary regarding the problem of

intrastate transport. They asserted that

nonattainment areas should work with

upwind contributing areas within the

State to address regional transport

within the State.

Response: As provided in the

proposed rule (68 FR 32829), we agree

with the commenters that States have

the obligation and authority to address

the transport of pollution from one area

13 Intrastate transport also could be considered in

determining the attainment date that is as

expeditious as practicable for subpart 2 areas, but

if the date were later than allowed for the area's

classification, the State would need to request

bump-up of the area to a higher classification for

that date to be approved.

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of the State to a different area of the

State.

Comment: Several comments

recommended an intrastate transport

classification.

Response: Our response to those

comments is in the response to

comment document for the Phase 1 Rule

of April 30, 2004. (Docket document

OAR-2003-0079-0717; p. 68.)

3. How will EPA address transport of

ground-level ozone and its precursors

for areas affected by international.

transport?

a. Background

As discussed in the proposal,

international transboundary transport of

ozone and ozone precursors can

contribute to exceedances of the

NAAQS. It is possible that the

international transport of air pollutants

may affect the ability of some areas to

attain and maintain the 8-hour ozone

NAAQS. Section 179B of the CAA

(International Border Areas), applies to

nonattainment areas that are affected by

emissions emanating from outside the

United States. This provision requires

EPA to approve a SIP for an ozone

nonattainment area if it meets all of the

requirements applicable under the CAA,

other than a requirement that the area

demonstrate attainment and

maintenance of the ozone NAAQS by

the applicable attainment date, and the

State establishes to EPA's satisfaction

that the SIP would be adequate to attain

and maintain the ozone NAAQS by the

applicable attainment date but for

emissions emanating from outside the

United States. The preamble to the

proposed rule recommended that States

should confer with the appropriate EPA

Regional Office to establish on a caseby-case basis the technical requirements

for these analyses.

b. Final Rule

As in the proposal, we are not setting

forth any regulatory provisions related

to international transport. Section 179B

of the CAA applies for these purposes.

We continue to recommend that States

confer with the appropriate EPA

Regional Office ft establish on a caseby-case basis the technical requirements

for analyses to support showings under

section 179B. These analyses will be

subject to public comment during the

State and Federal SIP processes.

c. Comments and Responses

Comment: Several commenters

addressed the discussion of

international transport in the proposed

rule. Two commenters suggested that

EPA is placing too high a burden on

States to make a demonstration that a

nonattainment area would attain but for

international transport (e.g., assessing

emissions from foreign countries). These

commenters stated that EPA has the

appro.priate resources and technical

expertise to evaluate international

transport and highlighted certain data

EPA has gathered and modelirig EPA

has performed. The commenters

suggested that EPA should re-evaluate

relevant policies regarding section 179B

of the CAA to ensure they are

streamlined and not unnecessarily

burdensome on States in making an

international transport demonstration.

Another commenter thought that the

proposed rule does not adequately

address ozone from international

sources, especially in a situation where

a State does not have jurisdiction over

most of the significant sources of ozone

or access to available data for modeling

in that region. Another commenter

encouraged EPA to expand its view of

the applicability of section 179B and

allow consideration of the impact on

attainment of smoke from crop burning

activities in Southern Mexico and

Central America.

Response: The CAA not EPA's

proposed rule, places the burden on

States to demonstrate that an area would

be able to attain but for emissions from

.sources located outside the United

States. However, EPA agrees with the

commenters that EPA has been

performing numerous activities that will

provide data that States may be able to

rely on as they develop these

demonstrations. We recognize that

adequate data for foreign sources may

not be available to States. Therefore,

modeling, according to the modeling

guidance for attainment demonstrations,

may not be possible in all cases.

Because the availability of information

and the causes of international pollution

vary significantly from one area to

another, EPA contiinues to believe that

the best approach for addressing

international transport is for States to

work with EPA on an area-by-area basis

to determine what is the best available

information and the best method for

analysis that fits the unique situation for

each area. Regarding consideration under

section 179B of the impact on

attainment of smoke from crop burning

activities in Southern Mexico and

Central America, in many cases it may

not be possible to confidently quantify

the impacts to the total ozone loadings

from individual foreign sources that are

hundreds or even thousands of miles

from the U.S. border. Particularly since

1998, when spring fires in Mexico and

Central America were very severe, EPA

has received much information about

the potential impacts from such

occurrences'on ozone and PM levels in

the United States. A prime lesson

learned from those experiences is that a

well-designed, detailed analysis is

required before one can estimate the

degree of influence from such fires. In

many cases, sufficient data will not exist

to draw such a conclusion. Case-by-case

consultation between EPA and the State

will help determine how best to

consider this information in attainment

planning.

With respect to the applicability of

section 179B to areas affected-by

emissions from very distant, foreign

sources, EPA currently has not taken a

position. If and when there are any SIP

submittals that request a section 179B

dispensation on such a basis, EPA will

examine those submittals on a case-bycase basis, including focusing on the

sufficiency of the technical

demonstration, in order to make a

determination of section 179B

applicability.

The EPA considers international

transport of pollution an important

issue. The EPA is engaged in several

international efforts that will allow u's to

better understand the linkages between

air pollution sources in other countries

and their impacts on public health and

air quality in the United States. The

EPA has cooperative agreements with

both Canada and Mexico to investigate

international border transport. The

information generated by these -

partnerships will assist States in

evaluating international transport

affecting 8-hour nonattainment areas.

D. How will EPA address

requirements for modeling and

attainment demonstration SIPs for areas

implementing the 8-hour ozone

standard?

[Section VI.H. of June 2, 2003

proposed rule (68 FR 32830); § 51.908 in

draft and final regulatory text.]

As noted in the proposal, an

attainment demonstration SIP consists

of (1) technical analyses to locate and

identify sources of emissions that are

causing violations of the 8:hour NAAQS

within nonattainment areas (i.e.,

analyses related to the emissions

inventory required for the

nonattainment area), (2) adopted

measures with schedules for

implementation and other means and

techniques necessary and appropriate

for attainment, (3) commitments, in

some cases, to perform a mid-course

review (MCR), and (4) contingency

measures required under section

172(c)(9) of the CAA that can be

implemented without further action by

the State or the Administrator to cover

failures'to meet RFP milestones and/or

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attainment. The final rule retains three of these foi lerhenfs, te recestion teiefthe exeptn

being. te.requirement for a comitment

to perform a MCR. As noted below, EPA

will assess whether a MCR is needed on

a case-by-case basis in-reviewing

individual attainment demonstrations.

In the Phase 1 Rule, § 51.908

contained only the requirement related

to the timing of implementation ofthe

emissions reductions needed for

attainment. In today's final rule, that

provision is retained as paragraph (d) of

§ 51.908, and other requirements related

to modeling and attainment

demonstrations appear in the remaining

paragraphs of § 51.908.

In the proposal, we also solicited

public comment on the guidance related

to multi-pollutant assessments (as

discussed below), areas with earlier and

later attainment dates, MCR, modeling

guidance, and multi-State

nonattainment areas. These topics are

discussed below. Associated with the

attainment demonstration also are the

RFP/ROP plans and the SIP submission

concerning RACM, both of which we

discussed elsewhere in the preamble to

the proposed rule and which are

discussed in later sections of this

preamble.

1. Areas With Early Attainment Dates

a. Background

The proposal noted that under section

182(a), marginal areas, which have a

maximum attainment date of 3 years

after designation, are not required to

perform a complex modeling analysis

using photochemical grid modeling. We

noted that areas covered under either

subpart 1 or 2 with ozone

concentrations close to the level of the

NAAQS [e.g., within 0.005 parts per

million (ppm)].14 will most likely come

into attainment within 3 years after

designation as nonattainment without

any additional local planning as a result

of national and/or regional emission

control measures that are scheduled to occur. We noted that regional scale

modeling for national rules, such as the

NOx SIP Call and Tier II motor vehicle

tailpipe standards, projects major ozone

benefits f6r the 3-year period of 2004-

2006. Attainment for many areas

classified as marginal is further

indicated by subsequent modeling used

to support the CAIR. This 3-ye ar period

coincides with the period that would be

used to determine whether an area

attains the 8-hour standard within 3

1

4

Even though the June 2, 2003 proposal

contained the reference to. the 0.005 ppm criterion,

the draft regulatory text issued for public comment.'

did not contain a reference to this criterion.

years after designation for areas

classified as marginal. I

If existing modeling for a marginal

area does not indicate the area will

attain with the current planned control

measures, EPA encouraged the areas to

request reclassification to moderate and

encouraged the State or Tribe to develop

an attainment demonstration using

photochemical grid modeling. (See 68

FR 32831; June 2, 2003.) Even though

modeling is not required, it may be

prudent.

• In the proposal, we noted that many

subpart 1 areas are projected through

regional modeling to come into

attainment within 3 years after

designation with current control

programs. Therefore, we proposed that

no additional modeled attainment

demonstration wouldbe required for areas with air-quality observations close

to the level of the standard and where

regional or national modeling exists that

is appropriate for use to demonstrate the

area will.attain the 8-hour standard

within 3 years after designation (i.e.,

based on data from 200,4-2006).

We proposed that areas subject only

to subpart 1 may request an attainment

date no later than 3 years following

designation for the 8-hour NAAQS by

submitting within 1 year of the

designation a SIP that demonstrates the

area will attain within 3 years following

designation. The demonstration must

include modeling results and analyses

that the State is relying on to support its

claim. Such modeling must be

consistent with EPA guidance and must

be appropriate for the area.

b. Summary of Final Rule

Although we proposed that subpart 1

areas requesting an attainment date

within 3 years after designation should

submit their attainment demonstration

within 12 months, we have removed

that provision from the final rule. A

subpart 1 area is free to choose to

submit its attainment demonstration at

any time prior to the 3-year due date.i

a

As is the case with all required

attainment demonstrations, the

demonstration must be submitted no

later than 3 years following designation

and must be appropriate for use in the

area. We anticipate that most subpart 1

areas will be included in the modeling

analyses conducted by areas with later

'1 The EPA notes that 8-hour ozone

nonattainment areas are also free to develop early

SIPs with motor vehicle emissions budgets for

transportation conformity purposes in advance of a complete SIP attainment demonstration. For more

informatibn on estaBlishing an early 8-hour ozone'

SIP and how it cduld.be used for conformity, please

refer to EPA's July 1, 2004, conformityfinal rule (69

FR 40019).

attainment dates. States are encouraged

to use these available aialyses, as well

as future EPA national or regional

modeling. The demonstration must

include modeling results and analyses

that the State or Tribe is relying on to

support its claim. Such modeling

should be consistent with EPA guidance

and should be applicable and

appropriate for the area.16 If acceptable

available modeling does not

demonstrate attainment, the area would

need to submit a local modeled

attainment demonstration.

c. Comments and Responses

Comment: Several commenters

recommended that the requirement for

attainment demonstrations from all

subpart 1 areas be eliminated.

Response: Section 172(c)(1) clearly

requires that nonattainment areas "* * * shall provide for attainment of

the national primary ambient air quality

standards." To meet this requirement, a

State must demonstrate that the area

will attain by a specified date and

identify and adopt the control measures

that will bring the area into attainment.

We see no authority for waiving this

requirement for areas.

Comment: What are the requirements

for subpart 1 areas requesting

attainment dates within 3 years of

designation?

Response: Subpart 1 areas must

submit their attainment demonstrations

within 3 years after designation.

2. Areas With Later Attainment Dates

a. Background

For areas with aitainment dates of

more than. 3 years after designation,

regardless of whether they are covered

under subpart I or subpart 2 (except

marginal areas), we proposed to require

them to submit an attainment

demonstration SIP. This proposal was

reflected in § 51.908(b) and (c) of the

draft regulatory text. We stated that

local, regional and national modeling

developed to support Federal or local

controls could be used provided the

modeling is consistent with EPA's

modeling guidance. Several States have

invested considerable time and

.resources in regional 8-hour ozone

modeling projects following this

guidance. Where exceedances of the 8-

hour ozone standard are more pervasive

and widespread than they were for the

1-hour ozone standard, we

recommended that States work together

in multi-State modeling efforts and

16 If an assessment indicates that a regional

modeling analysis is not applicable. to a particular

nonattainment area, additional local modeling

would be required.

I I . ] " f Iii " f

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leverage off work under development

and resources spent on these projects.'

b. Summary of Final Rule

Subpart 1 areas with attainment dates

later than 3 years after designation and

areas classified as moderate or higher

under § 51.903, are required to submit

an attainment demonstration no later

than 3 years after the effective date of

designation for the 8-hour ozone

NAAQS. Areas with an effective date of

designation of June 15, 2004 are

required to submit an attainment

demonstration no later than June 15,,

2007. These demonstrations must be

consistent with section 51.112,

including appendix W. In addition, for

the review of technical adequacy, we

will generally relyj on our most recent

modeling guidance at the time the

modeled attainment demonstration is

performed. We will be making available

a final version of the modeling guidance

related to developing attainment

demonstrations for the 8-hour ozone

standard.17

Areas required to submit an

attainment demonstration are

encouraged to follow the procedures

described in .this guidance. Local,

regional and national modeling

developed to support Federal or local

controls generally may be used provided

the modeling is consistent with EPA's

modeling guidance at the time the

modeled attainment demonstration is

performed.l"

c. Comments and Responses

We received no comments on this

topic per se; comments on the timing of

submission of attainment

demonstrations is discussed elsewhere.

We noted in" the proposal that comments

on the modeling guidance were

welcome at any time and that we would

consider those comments in any future

revision of that document. We noted

that comments submitted on the

modeling guidance document would not

be docketed as part of this rulemaking,

17 U.S. EPA, (November 4, 2005), Guidance on the

Use of Models and Other Related Analyses in

Attainment Demonstrations for the 8-Hour Ozone

NAAQS, EPA-454/R-05-002, http://www.epa.govl

Un/scram, (Modeling Guidance, File name: ozonefinal.pdfl.

18 The guidanpe may not apply to a particular

situation, depending upon the circumstances. The

EPA and State decision makers retain the discretion

to adopt appr6achei on a case-by-case basis that

differ from this guidance where appropriate. Any

decisions by EPA regarding a particular SIP

demonstration will only be made-based on the

statute and regulations, and will only be made

following notice and opportunity for public review

and comment. Therefore, interested parties will be

able to raise questions and objections about the

contents of this guidance and the appropriateness

of its application for any particular situation.

nor would a comment/response

summary of these comments be a part of

the final 8-hour ozone implementation

rule since they will not affect the rule

itself. We will address those comments

at the time we issue the final modeling

guidance.

3. Multi-State Nonattainment Areas

a. Background

As discussed ini'the June 2003

proposal, section 182(j) of the CAA

defines a multi-State ozone

nonattainment area as an ozone

nonattainment area, portions of which

lie in two or moreStates. Section

182(j)(1)(A) and (B) set forth certain

requirements for such areas. First, each

State in which a multi-State ozone

nonattainment area lies must take all

reasonable steps to 'coordinate the

implementation of the required

revisions to SIPs for the given

nonattainment area [section

182(j)(i)(A)I. Next, section 182(j)(1)(B)

requires the States to use photohemical

grid mod6ling or aniy other equally

effective analytical method approved by

us for demonstidtiiig attainment. We are

prevented b'y section 182(j) from

approving any SIP revision submitted

under that section 'if a State has failed

to meet the: abov6'iequirements.

To address thelprovisions of section

182(j)(1)(A), States that include portions

of a multi-State ozone nonattainment

area should develop a joint work plan

as evidence of early cooperation and,

integration, The work plan should

include a schedule for developing the

emissions inventories, and the

attainment demonstration for the entire

multi-State area. Each State within a.

multi-State ozone nonattainment area is

responsible for meeting all the

requirements relevant to the given area.

Care should be taken to coordinate

strategies and assumptions in a modele&

area with those in other, nearby ,

modeled areas in order to ensure that

consistent, plausible strategies are

developed.

Section 182(j)(2).for multi-State

nonattainment areas recognizes that one

State may not be ,able to demonstrate

attainment for the nonattainment area if

other States in which portions of the

nonattainnment area are located do not

adopt and submit the necessary

attainment plan for the area. In such

cases, even though the area as a whole

would not have an approvable

attainment demonstration, the -sanction

provisions of'section 179 will not apply

in the portidn ofthe nbnattainment* area

located in a State that submitted an .....

attainment plan. *, " -

b. Summary of Final Rule

As discussed in the proposal, State

partners involved in a multi-State ozone

nonattainment area must work together

to perform the appropriate modeling

analyses to identify control measures

that will enable the area to achieve

attainment as expeditiously as

practicable. Each State will be

responsible for its portion of the control

program and therefore will be held

accountable for controls identified for

implementation within its State

boundaries. The modeling analyses

should encompass the entire multi-State

nonattainment area as well as adjacent

counties which may contribute to the

nonattainment problem. State plans

should address local transport within

the region and its contribution to

nonattainment in the multi-State area.

Consideration of long-range transport

and its contributions to nonattainment

is discussed in section IV.B. of this

preamble. Multi-State nonattainment

areas are subject to the same modeling

and attainment demonstration

requirements of the final rule that apply

to all other areas. Marginal multi-State

nonattainment areas do not have to

submit a modeled attainment

demonstration because section 182(a)

exempts marginal areas from the

requirement to submit an attainment

demonstration.

c. Comments and Responses

Comment: Several commenters

encouraged us to clearly define in the

rule how multi-State nonattainment

areas will be treated if all or a portion

of an area is subject only to subpart 1.

One of these commenters requested a

clarification that photochemical grid

modeling will not be required for multiState areas classified under subpart 1 or

areas that are classified as marginal. The

commenter's reasoning was that such

modeling is unnecessary since they are

close to achieving the 8-hour NAAQS

and will be in attainment before the

modeling can be completed. . Response: We agree with these

commenters that since section 182(a)

exempts marginal areas from the

requirement to submit an attainment

demonstration, such areas need not

develop an attainment demonstration.

Section 182(j) of the CAA requires that

multi-State areas use photochemical '

grid modeling as part of their attainment

demonstrations while Section 172

(Subpart f areas) of the CAA does not

explicitly require photochemical grid

moddling? For gubpart 1 areas that do

nbt sbek'ai attainm'ent date of 3 years

or less after ddsignati6n, we iike no I distinctlof bdtwveen'multi-State'dnd

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single-State subpart 1 nonattainment

areas. All subpart 1 nonattainment areas are required to submit an attainment

demonstration that relies on

photochemical grid modeling, either

one that has already been performed

that is appropriate for use in the area,

or a new one. We do not believe that

techniques other than those based on

photochemical grid modeling will

provide credible assurance that an area will achieve the 8-hour ozone standard

by the area's attainment date.

Comment: One commenter requested

that we perform the modeling for multiState areas. Two commenters stated that

if any additional photochemical

modeling is required for such areas

pursuant to CAA 182(j}(1)(B), then EPA.

should refine previous modeling;

perform new modeling; or approve a less resource-intensive, altermAte

method that fulfills the requirement.

The commenters asserted that we should assist the States in coordinating

the development of the attainment/

maintenance plans and ensure that areas involving multiple EPA Regions are not

hampered by jurisdictional conflicts and

inconsistencies.

Response: The EPA has conducted,

and will continue to conduct, regional

and national scale nhodeling that covers most of the ozone nonattainment areas.

Both single State and multi-State

nonattainment areas will be able to

make use of EPA modeling, where

appropriate. The EPA will work with

States to determine the steps necessary

foK the proper use of EPA modeling in a local attainment demonstration. States

that plan to use EPA modeling in lieu

of local modeling should be prepared to

justify the local use of the regional

projections as well as conduct

additional analyses to monitor progress

towards attainment. The EPA will

continue to work with States to

coordinate the development .of

consistent attainment/maintenance

plans.

4. Role of Modeling Guidance in

Attainment Demonstrations

a. Background

The proposal noted that section

•182(b)(1)(A) requires ozone no nattainment areas to develop an

attainment demonstration which

provides for reductions in VOC and

NOx emissions "as necessary to attain

the national primary ambient air quality

standard for ozone:" Section.172(c),

requires areas covered under subpart 1

to demonstrate attainment. For a subpart

1 area that does not qualify for an attainment date within 3 years after

designation, we proposed to require the

State to develop and submit a modeled

attainment demonstration.. 19

We noted that section 182(c)(2)(A)

provides that for serious and higherclassified areas the "attainment

demonstration must be based on

photochemical grid modeling or any

other analytical method determined by

the Administrator, in the

Administrator's discretion, to be at least

as effective." A photQchemical grid

model should meet several general

criteria for it-to be a candidate for

consideration in an attainment

demonstration. We noted that, unlike in

previous guidance,20 we did not

propose recommending a specific

photochemical grid model for use in the

attainment demonstration for the 8-hour

NAAQS for ozone. At present, there is

no single model which has been

extensively tested and shown to be

clearly superior or easier to use than

other available models. Criteria for

attainment demonstrations are

contained in 40 CFR 51.112, including

appendix W (i.e., "EPA's Guideline on

Air Quality Models," 68 FR 18440,

April 15, 2003). Appendix W refers to

EPA's "Use of Models and Other

Analyses in Attainment Demonstrations

for the 8-Hour Ozone NAAQS" and lists

a set of general requirements that an air

quality model should meet to qualify'for

use in an attainment demonstration for

the 8-hour ozone NAAQS. 21 The

proposal described alternatives

available to the States and the scope and

coverage of the draft guideline. The

draft regulatory text of 2003 addressed

this requirement in § 51.908(d).

We noted that we were planning to

make substantial changes to the draft

version of this document before

finalizing the attainment demonstration

aspects of the implementation rule. We

said we welcomed public comments on the guidance at any time and would

consider those comments in any future

revision of the document. However, we said we would not consider comments

1

9 As noted above in the discussion of subpart 1

areas with early attainment dates, although the draft

regulatory text in § 51.908(a) was structured such

that no attainment demonstration was needed for

subpart I areas that received an attainment date

within 3 years after the effective date of the

nonattainment designation, this was misleading,

since the draft § 51.904(b)(2) provision that affected

these areas required submission of a demonstration

of attainment within 3 years after designation. The

final regulatory text in § 51.908(b) clarifies this

point.

20 U.S. EPA, (1991), Guideline for Regulatory

Application of the Urban Airshed Model, EPA-450/

4-91-013. Available at: http://www.epa.govl

scramOO1/tt25.htm; see document DRAFT8HR. 2 1 U.S. EPA, (May 1998), Draft Guidance on the

Use of Models and Other Analyses in Attainment

Demonstrations for the 8-Hour Ozone NAAQS,

EPA-454/R-99-004, http://www.epa.gov/ttn/scram,

(Modeling Guidance, File name: DRAFT8HR).

on the technical merits of the modeling

guidance in this present rulemaking.

b. Summary of Final Rule

The final rule [§ 51.908(c)] requires

each attainment demonstration to be

consistent ivith the provisions of

§ 51.112, including appendix W to 40

CFR part 51. In addition, we will

generally review the demonstrations for

technical merit using EPA's most recent

modeling guidance at the time the

modeling relied on in the attainment

demonstration is performed. This

guidance will generally have the State

provide (1) technical analyses to locate

and identify sources of emissions that are causing violations of the 8-hour

NAAQS within nonattainment areas, (2)

adopted measures with schedules for

implementation and other means and

techniques necessary and appropriate

for attainment that are needed for

attainment, with implementation no

later than the beginning of the

attainment year ozone season 22 (e.g.,

prior to 2009 ozone season for areas

with June 15, 2010 attainment dates),

and (3) contingency measures required

under section 172(c)(9) of the CAA that

can be implemented without further

action by the State or the Administrator

'to cover emissions shortfalls in RFP

plans and failures to attain.

c. Comments and Responses

Comment: One commenter

recommended that EPA must ensure

that attainment demonstrations are

based on scientifically valid regional

airshed modeling rather than

scientifically invalid linear proportional

rollback and weight-of-evidence

methods.

. Response: Criteria for attainment

demonstrations are contained in 40 CFR

51.112, including appendix W (i.e.,

"EPA's Guideline on Air Quality

Models," 68 FR 18440, April 15, 2003).

Appendix W cites EPA's "Use of Models

and Other Analyses in Attainment

Demonstrations for the 8-Hour Ozone

NAAQS" and describes a set of general

criteria that an air quality model and its

application should meet to qualify for

use in an attainment demonstration for

the 8-hour ozone NAAQS.23 The draft

guidance was developed through a

collaborative process, which included

review from the scientific community,

and it has been revised to reflect recent

review comments. The procedures

described are considered a scientifically

12 See 40 CFR 51.900(g) for definition. 2 3 U.S. EPA, (1998), Draft Guidance on the Use of

Models and Other Analyses in Attainment

Demonstrations for the 8-Hour Ozone NAAQS,

EPA-454/R-99-004, http://www.epa.gov/ttn/scram,

(Modeling Guidance, File name: DRAFT8HR).

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valid use of regional and urban airshed

modeling. The modeled attainment test

makes use of the model derived

relationship between ozone and its

precursors. It does not, as is the case

with proportional rollback, assume

equal proportions of the precursors will

provide an equally proportional

reduction in ozone. For example; it does

not assume that 20 percent reduction in

precursors will provide 20 percent

improvement in ozone.

The guidance alsoidentifies

additional data which, if available,

should enhance the credibility of model

results and results of other analyses

used in a weight of evidence

determination. The EPA believes use of

weight of evidence-is appropriate as do

many in the scientific community.

Weight of evidence-is a credible

approach for considering inherent

uncertainties in a modeling application.

As noted above, we will be making

available a final version of the modeling

and attainment demonstration guidance

for the 8-hour ozone standard. 24

Conjnent: All attainment

demoITstrations should be subject to the

same rigorous standards.

Response: The EPA envisions that the

final 8-hour ozone modeling guidance

will be available for use by the majority

of subpart 1 areas and subpart 2 areas

classified as moderate and above.

However, due to the unique nature of

the ozone problem in many areas, EPA

will accept various applications of the

guidance. Although EPA anticipates all

areas will follow the guidance closely,

there will be variation based on

availability of new and improved data

methods and field study data. The EPA

is always striving to make best use of

available data and improvements in

methodologies as the science and our

understanding of ozone formation and

transport in different parts of the

country increases. Unique to many areas

is the source receptor configuration,

level of precursor data collected and the

model's ability to simulate unique

factors influencing the formation and

transport of ozone. As .more information

becomes available in particular areas,

EPA expects more rigorous

demonstrations will be provided. Areas

close to attaining the standard for which

there is a better understanding of the

meteorology and the relationships

between precursor emissions and ozone

may not require as much rigor. These

decisions will be made on a case-bycase basis and the public will be able to

1 24 U.S. EPA, (2005), Guidance on the Use of

Models and Other Related Analyses in Attainment

Demonstrations for the 8-Hour Ozone NAAQS,

EPA-454/R-05-002, http://www.epa.gov/ttn/scram,

(Modeling Guidance, File name: ozone-final.pdf).

express their views during the State SIP

development and EPA review process.

Comment: The EPA cannot adopt or

change the Draft Guidance, use it for

regulatory purposes, or require States to

use it for regulatory purposes, without

subjecting it to separate notice-andcomment rulemaking. .

Response: The final rule [§ 51.908(c)]

requires each attainment demonstration

to be consistent with the provisions of

40 CFR 51.112, including appendix W.

However, we are not adopting the

Guidance as a rule. The EPA plans to

use the current (2005) guidance and

future updates as a benchmark for

reviewing the technical analysis

submitted in support of 8-hour ozone

attainment demonstrations. The

guidance document is not a regulation.

Therefore, it does not impose binding,

enforceable requirements on any party,

and may not apply to a particular

situation based upon the circumstances.

The EPA and State decision makers

have the-discretion to adopt a'proaches

on a case-by-case basis that differ from

this guidance where appropriate. Any

decisions by EPA regarding adequacy of

a particular SIP to meet the 8-hour

ozone NAAQS will be based on the

CAA and our regulations. Therefore,

interested parties are free to raise

questions and objections about the

appropriateness of the application of

this guidance to a particular situation

during the State SIP development qnd

EPA review process.

Comment: One commenter requested

an opportunity to review and comment

on the revised guidance prior to the

"final" release.

Response: States, Tribes and others

were given an opportunity to comment

on the revised draft guidance prior to

release. Also, EPA received additional

comments on the draft guidance during

the comment period on the

implementation rule. The EPA has

reviewed and considered the comments

and will be releasing the final guidance.

For more information and updates to the

modeling guidance for ozone, visit

EPA's Technology Transfer Network

Support Center for Regulatory Air

Models (TTN/SCRAM) on the Internet,

http://www.epa.gov/ttn/scram/. Even

though the guidance will be issued in

final form shortly, EPA is always open

to suggestions for future improvements

to the guidance, including the

incorporation of methodologies and

procedures that increase accuracy and

credibility of results. Such suggestions

may be made to EPA regional or

headquarters modeling contacts listed at

the above TTN/SCRAM web site.

Comment: The EPA should carefully

consider the resources that will be

needed to perform the requisite

modeling for multiple areas in many

States.

Response: States/Tribes are

encouraged to share and leverage

resources currently being used in

regional model applications that affect

multiple areas. There is much

opportunity for common use of data and

methodologies among the modeling

requirements for the regional haze

program, the PM 2 .

5 attainment

demonstrations and the ozone

attainment demonstrations that should

make the overall exercise less onerous.

States and Tribes are encouraged to .

model multiple precursor strategies for

multiple areas and review their efficacy

for all three programs.

.Comment: Any photochemical grid

model utilized must either be in the

public domain or licensed for unlimited

use by any person for purposes of

modeling within the area.

Response: The EPA modeling

guidance supports this comment which

is addressed in section 10 of the

modeling guidance. "Applicable

models" may be used, if they are nonproprietary. A "non-proprietary" model

is one whose source code is available for

free or for a reasonable cost. Further, the

user must be free to revise the code to

perform diagnostic analyses and/or to

improve the model's ability to describe

observations in a credible manner.

Comment:-One commenter

recommended that EPA update its

guidance in 40 CFR 51, appendix W to

include a discussion of the role of

weight-of-evidence as part of a modeling

demonstration, and tomake any updates

in appendix W subject to public review.

Response: In regard to the role of

weight of evidence, EPA does not plan

to revise appendix W. Use of weight of

evidence is dependent on local

information only available when the

technical analysis for a specific model

application is under development.

Therefore, use of weight of evidence is

considered on a case-by-case basis as

the appropriate Regional Office works

with the State as it develops its SIP and

during the State adoption process and

during EPA's SIP approval process. Any

weight of evidence analysis is available

for public review.

5. Mid-Course Review (MCR)

a. Background

The proposal noted that a MCR

provides an opportunity to assess

whether a nonattainment area is or is

not making sufficient progress toward

attainment of the 8-hour ozone

standard, as predicted in its attainment

demonstration. We noted that a

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commitment to perform a MCR is a

critical element of an attainment

demonstration that employs a long-term

projection period and relies on weight

of evidence. Because of the uncertainty

in long-term projections, we said we

believed such attainment

demonstrations need to contain

provisions for periodic review of

monitoring, emissions, -and modeling

data to assess the extent to which

refinements to emission control

measures are needed.

A number of States participated in a

consultative process with EPA, which

resulted in the development of the Ihour MCR guidance. 25 We noted that we

would update the 1-hour MCR policy

and technical guidance to include 8-

hour metrics and that we were soliciting

comment on appropriate revisions. We

proposed that the final MCR guidance

incorporating 8-hour metrics would be

available at the time we issue our final

implementation rule.

The proposal briefly described the

procedure for performing a MCR. The

proposal noted that States would not

have to commit in advance to adopt new

control measures as a result of the MCR

process. Based on the MCR, if we

determine sufficient progress has not

been made, we would determine

whether additional emissions

reductions are necessary from the

State(s) in which the nonattainment area

is located or upwind States or both. We

would then require the appropriate

State(s) to adopt and submit new

measures to bring about the necessary

emissions reductions within a specified

period. We anticipated that these

findings wouldbemade as calls for SIP

revisions under section 110(k)(5) and,

therefore, the period for submission of

the measures would be no longer than

18 months after the EPA finding. Thus,

we proposed that States complete the

MCR 3 or more years before the

applicable attainment date to ensure

that any additional controls that may be

needed can be adopted in sufficient

time to reduce emissions by the start of

the ozone season in the attainment year.

b. Summary of Final Rule

The final regulatory text does not

contain a requirement for the MCR. In

reviewing attainment demonstrations

from individual States, however EPA

will assess the need for a MCR.for areas

with an attainment date beyond 6 years

25 Memorandum of March 28, 2002, from Lydia N.

Wegman and J. David Mobley, re: "Mid-Course

Review Guidance for the 1-Hour Ozone

Nonattainment Areas that Rely on Weight-ofEvidence for Attainment Demonstration." Located

at URL: http://www.epa.gov/scramOO1/guidance/

guide/policymem33d.pdf.

after the effective date of the area's

designation in the context of whether

the attainment demonstration and any

weight of evidence analysis is

supportable without a commitment by

the State to perform a MCR.

The 8-hour ozone modeling

guidance 26 is expected to identify

measurements and activities to support

subsequent reviews of an attainment

demonstration SIP (i.e., MCR), such as

improvements in air quality monitoring,

meteorology and emission

measurements. Even though the

proposal noted that we expected to

revise the existing 1-hour MCR

guidance, EPA now believes the 1-hour

MCR guidance coupled with the 8-hour

modeling guidance provides sufficient

guidance. States should consult with

EPA prior to using a methodology other

than the one developed through the

public consultative process.

Guidance for performing a MCR for

the 1-hour ozone NAAQS identifies

several methods for reviewing whether

the existing SIP is sufficient for the area

to attain by its attainment date. 27 These

guidance documents should provide

adequate information for developing

protocols for performing MCRs for the 8-

hour ozone NAAQS. States/Tribes

should prepare protocols which identify

analyses and data bases to be used to

support a MCR and discuss these with

the appropriate EPA Regional Office

prior to performing a MCR. If we

determine that additional guidance is

needed, we will issue updated guidance

in a timeframe suitable to support the

timely completion of MCRs.

c. Comments and Responses

Comment: Requiring the MCR 3 or

more years prior to the attainment date

is not reasonable or feasible for some

areas. The EPA needs to recognize that

for moderate and lower classifications

the MCR would be due at the time of the

SIP submittal. Mid-course review

should be required only for areas with

nonattainment classifications of serious

or greater, as at least 3 years of

monitored data are required for a MCR,

after the implementation of controls.

One commenter recommended that EPA

make the MCR process part of the

requirements for RFP and ROP.

26 U.S. EPA, (2005), Guidance on the Use of

Models and Other Related Analyses in Attainment

Demonstrations for the 8-Hour Ozone NAAQS,

EPA-454/R-05-002, http://www.epa.gov/ttn/scram,

(Modeling Guidance, File name: ozone-final.pdf). 27 Memorandum of March 28, 2002, from Lydia N.

Wegman and J. David Mobley, re: "Mid-Course

Review Guidance for the 1-Hour Ozone

Noisattainment Areas that Rely on Weight-ofEvidence for Attainment Demonstration." Located

at URL: http://www.epa.gov/scramOO1/guidance/

guide/policymem33d.pdf.

Response: The final regulatory text

does not require a MCR; as noted above,

EPA. will assess on a case-by-case basis

whether a MCR would be needed in the

context of a particular attainment

demonstration.

Comment: The EPA should develop

proper analysis techniques so that

meteorological conditions do not affect

a nonattainment area's perceived

progress towards attainment. A MCR

should also include an evaluation of

ozone transport into the nonattainment

area and control implementation in

upwind areas.

Response: Assessments of transport

are covered in the MCR guidance. The

EPA is improving methods for

determining the ozone trends and how

they are affected by meteorology. The

latest information will be made

available.

Comment: The EPA needs to release

the revised MCR guidance before the

final rule is issued in order for it to be

reviewed and commented on during the

public comment period.

Response: The final rule does not

incorporate any MCR guidance by

reference. The 8-hour ozone modeling

guidance 28 is expected to identify

measurements and activities to support

subsequent reviews of an attainment

demonstration SIP (i.e., MCR), such as

improvements in air quality monitoring,

meteorology and emission

measurements. Guidance for performing

a MCR for the 1-hour ozone NAAQS

identifies several methods for.reviewing

whether a SIP is on track to attain

within prescribed time ]imits.2 9 These

guidance documents should provide

adequate information for developing

protocols for performing MCRs for the 8-

hour ozone NAAQS. States/Tribes

should prepare protocols which identify

analyses and data bases to be used to

support a MCR and discuss these with

the appropriate EPA Regional Office

prior to performing a MCR. If we

determine that additional guidance is

needed, we will issue updated guidance

in a timeframe suitable to support

completion of MCR's within established

deadlines.

2 8 U.S. EPA, (2005), Guidance on the Use of

Models and Other Related Analyses in Attainment

Demonstrations for the 8-Hour Ozone NAAQS,

EPA-454/R-05-002, http://www.epa.gov/ttn/scram,

(Modeling Guidance, File name: ozone-5nal.pdf). 2

9 Memorandum of March 28, 2002, from Lydia N.

Wegman and J. David Mobley, re: "Mid-Course

Review Guidance for the 1-Hour Ozone

Nonattainment Areas that Rely on Weight-ofEvidence for Attainment Demonstration." Located

at URL: http://www.epa.gov/scramOOl/guidancel

guide/policymem33d.pdf.

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6. Multi-Pollutant Assessments (OneAtmosphere Modeling) 30

a. Background

The proposal noted that many factors

affecting formation and transport of

secondary fine particles (i.e., PM2.

5

components) are the same as those

affecting formation and transport of

ozone. The proposal, therefore, noted

that models and data analysis intended

to address visibility impairment need to

be capable of simulating tr4nsport and

formation of both secondary fine

particles and ozone. At a minimum,

modeling should include previously

implemented or planned measures to

reduce ozone, secondary fine particles,

and visibility impairment. An integrated

assessment of the impact controls have

on ozone, secondary fine particles, and

regional haze provides safeguards to

ensure ozone controls will not preclude

optimal controls for secondary fine

particles and visibility impairment.

The concept of modeling control

impacts .on all three programs is further

strengthened by the alignment of the

implementation process for ozone and

secondary fine particles. As the dates for

attainment demonstration and planning

SIPs for the three programs are

anticipated to be fairly close, the

practicality of using common data bases

and analysis tools for all three programs

is viable and encourages use of shared

resources.

The proposal noted that States that

undertake multi-pollutant assessments

as part of their attainment

demonstration would assess the impact

of their ozone attainment strategies on

secondary fine particles and visibility or

perform a consistent analysis for ozone,

secondary fine particles, and visibility.

To facilitate such an effort, we

encouraged States to work closely with

established regional haze Regional

Planning Organizations (RPOs) and the

jurisdictions responsible for developing

PM2.

5 implementation plans. We

encouraged States to perform similar

multi-pollutant assessments as part of

their ozone attainment demonstrations,

considering the control programs that

are in place at the time of the

assessment. Multi-pollutant assessments

are discussed elsewhere in this

proposedrulemaking.

3

oUse of models that are capable of simulating

transport and formation of multiple pollutants

simultaneously. For example, for ozone and fine

particles, it is critical that the model simulate

photochemistry, which includes interactions among

the pollutants and their precursors.

b. Summary of Final Rule

There is no regulatory text on the

issue of multi-pollutant assessments,

but we recommend the'following:

* Attainment demonstration

modeling should include previously

implemented or planned measures to

reduce ozone, secondary fine particles,

and visibility impairment.

* An integrated assessment of the

impact controls have on ozone,

secondary fine particles, and regional

haze is encouraged to promote

efficiencies in strategies for achieving

all three goals.

* States are also encouraged to use

common data bases and analysis tools

for all three programs and work closely

with established regional haze RPOs

and the jurisdictions responsible for

developing PM2.

5 implementation plans.

e States are encouraged to follow

EPA's lead and perform similar multipollutant assessments as part of their

ozone attainment demonstrations,

considering the control programs that

are in place at the time of the

assessment.

c. Comments and ResponsesComments: The EPA received several

comments on the recommendation that

States perform multi-pollutant

assessments as part. of their ozone

attainment demonstrations. Almost all

of the comments agreed with the basic

rationale behind encouraging an

analysis of the expected ozone, PM2 .

5 ,

and visibility impacts of a given set of

air quality control measures associated

with an 8-hour ozone attainment'

demonstration. The comments differed

on whether multi-pollutant assessments

should be required or only encouraged.

The commenters who urged EPA to

encourage rather than require a multipollutant assessment provided reasons

for why they believe a multi-pollutant

assessment is not possible at this time.

One commenter indicated that the

proposal was unclear as to whether the

multi-pollutant assessments were

required.

One commenter recommended that

EPA require, in certain unspecified

cases, nonattainment areas to perform

an integrated control strategy .

assessment to ensure that ozone controls

will not preclude optimal controls for

secondary fine particles and visibility

impairment. Conversely, several other

commenters expressed the opinion that

the multi-pollutant assessment should

not be a requirement of an ozone

attainment demonstration. Several

reasons were offered for why the

assessment should remain optional: (1)

That the state of the science for *

assessing PM2.5 and visibility is not yet

sufficient for providing meaningful

input to the regulatory process, (2) that

the additional resources necessary to.

model the atm6sphere as a single system

would result in an undue burden on the

States, and (3) that requiring a PM2.5 and

visibility assessment would result in

delayed attainment due to the

additional time necessary to complete

such an analysis. . Response: The EPA continues to

believe that encouraging, but not

requiring, multi-pollutant assessments

is the most sound approach for total air

quality management given the schedule

by which ozone attainment

demonstrations are legally required.

Much progress has been made on

improving the available PM2.

5 models

and inputs to these models over the past

3 years. As a result, EPA believes that

the available tools are able to support air

quality planning. Further improvements

are likely over the next several years;

much of which will be driven by the

RPO's. By working closely with the

appropriate RPO's, States can reduce the

burden associated with one-atmosphere

modeling analyses. However, EPA

recognizes that many States have

already invested resources in an ozoneonly modeling platform analysis which

is typically conducted over a finite

number of episode days and for

geographic regions that are typically less

than (in time) and smaller than (in

space) what might be required in a

multi-pollutant assessment. By

encouraging States to consider such

assessments, EPA hopes to speed the

process of the transition to more

integrated air quality planning tools

while yielding sound multi-pollutant

control strategies. It is prudent for areas

to perforrh these multi-pollutant

assessments earlier as it will lessen the

planning burden in the long-term since

later planning activities for PM 2.5 and

regional haze will need to consider the

effects of emission control measures .

adopted for the ozone attainment plan.

7. What baseline emission inventory

should be used for the attainment

demonstration?

[Not addressed in the June 2, 2003

proposal; § 51.909 of the draft regulatory

text.]

The June 2, 2003 proposal did not

discuss baselines for purposes of the

attainment demonstration. (It did,

however, discuss baselines for RFP

demonstrations.) Sction 51.909 of the

draft regulatory text provided that 2002

should be used as the baseline emission

inventory year for purposes of both RFP

and the attainment demonstration for

areas with an effective date of

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designation of June 15, 2004. We

recognize, however, that some areas

have already begun to perform modeling

for their attainment demonstrations

using baseline year inventories earlier

than the 2002 inventory, and because

the 2002 inventory may not be in a

format to readily be used for

photochemical grid modeling. 31

Therefore, the final rule does not specify

a baseline for purposes of the attainment

demonstration and modeling. As

discussed more fully in the section of

the preamble regarding RFP, the

specification of 2002 as a baseline year

for RPP purposes (for areas with an

effective date of designation of June 15,

2004) appears in the RFP provisions of

40 CFR 51.910. Section 51.909 remains

reserved.

8. Voluntary Reclassifications ("BumpUps")

Although we believe most 8-hour

nonattainment areas will attain the

standard by their statutory attainment

date, we recognize that some areas

classified under subpart 2 may need

additional time beyond the statutory

attainment date for their area to attain

as expeditiously as practicable. As

discussed in the Phase 1 Rule (69.FR at

23959, col. 3), in the event an area

cannot practicably attain by the

maximum date for its classification, the

Clean Air Act provides the opportunity

for more time. An area regulated under

subpart 2 can receive a later maximum

attainment date through a State request

to bump-up to a higher classification

(e.g. from moderate to serious). The Act

requires EPA to grant a State request to

reclassify an area to a higher

classification; the State plan still must

provide for attainment as expeditiously

as practicable. Although bump-up

means that certain additional specified

requirements apply, an area may already

be meeting most or all of these specified

requirements due to controls previously

adopted to implement the 1-hour ozone

standard. This is because some areas

had 1-hour classifications that were

" higher (and more restrictive) than the

31 The EPA guidance on baseline years is found

in the memorandum of November 18, 2002, from

Lydia Wegman and Peter Tsirigotis, "2002 Base

Year Emission Inventory SIP Planning: 8-hr Ozone,

PM2.

5 and Regional Haze Programs." This document

is available at the following Web site: http://

www.epa.gov/ttn/oarpglmeta.44g. 1.202baseinv.pdf.

That document noted, "The EPA is aware that some

areas have already begun on a voluntary basis to

model for purposes of the 8-hour ozone standard.

These areas may continue to use modeling from

previous base years for each set of meteorological

episode conditions for use in their SIP submittals

if these studies are still applicable for an attainment

demonstration."

areas' 8-hour classification,32 and

because the Phase 1 final

implementation rule for the 8-hour 03

NAAQS contains anti-backsliding

provisions generally requiring areas to

continue implementing measures

required for the 1-hour classification.

Although 'there may not be additional

mandatory control measures required

because the areas may already have

such measures in place, an area that

needs more time to attain may need

additional emission reductions to reach

attainment.

E. What requirements for RFP should

apply under the 8-hour ozone standard?

[Section VI.I. of June 2, 2003 proposed

iule (68 FR 32832); § 51.909 and

§ 51.910 in draft; § 51.910(d) in final

regulatory text.]

1. General Discussion

a. Background

As noted in the June 2, 2003 proposal,

section 172(c)(2), which is located in

subpart 1, requires State plans for

nonattainment areas to require RFP.

Section 171(1) of the CAA defines RFP

to mean "such annual incremental

reductions in emissions of the relevant

air pollutant as are required by this part

(part D of title I] or may reasonably be

required by the Administrator for the

purpose of ensuring attainment of the

applicable [NAAQS] by the applicable

date."

Subpart 2 provides more specific RFP

requirements for ozone areas classified

under section 181. 3 3 In particular,

subpart 2 specifies the base year

emissions inventory upon which RFP is

to be planned for and implemented, the

increments of emissions reductions

required over specified time periods,

and the process for determining whether

the RFP milestones were achieved.

Subpart 2 does not specify RFP

requirements for marginal areas. Section

182(b)(1)(A) mandates a 15 percent VOC

emission reduction, accounting for

growth, between 1990 and 1996 for

moderate and above ozone

nonattainment areas. Furthermore,

32 Although some 8-hour ozone nonattainment

areas have additional areas beyond the boundary of

the former 1-hour nonattainment area and thus

would be. faced with new requirements for the

higher classification.

33 Note thet § 51.900 provides the following

definitions:

(p) Reasonable further progress (RFP) means for

the purposes of the 8-hour NAAQS, the progress

reductions required under section 172(c)(2) and

section 182(b)(1) and (c)(2)(B) and (c)(2)(C) of the

CAA.

(q) Rate of progress (ROP) means for purposes of

the 1-hour NAAQS, the progress reductions

required under section 172(c)(2) and section

182(b)(1) and (c)(2](B) and (c)(2)(C) of the CAA.

section 182(c)(2)(B) of the CAA requires

each serious and above ozone

nonattainment area to submit a SIP

revision providing for an actual VOC

emission reduction of at least 3 percent

per year averaged over each consecutive

3-year period beginning in 1996 until

the area's attainment date (referred to as

the post-1996. ROP plan for the 1-hour

standard). Section 182(c)(2)(C) of the

CAA allows for substitution of NOx for

VOC emissions reductions for

reductions required under section

182(c)(2)(B). The EPA's policy, NOx

Substitution Guidance (December 15,

1993; available at http://www.epa.govl

ttn/oarpg/tpgm.html), addresses the -

substitution of NOx emissions

reductions for VOC emissions

reductions. The baseline emissions

inventory for determining the required

ROP reductions for the 1-hour standard

is specified in section 182 ds 1990.

The requirements for RFP under

subparts 1 and 2, as described above, are

the minimum required for an area. More

reductions may be necessary for

attainment within the nonattainment

area. Moreover, an upwind area that

contributes to nonattainment in a

downwind area in the same State may

need reductions in order for the

downwind area to reach attainment by

its required attainment date. As we

noted above in section IV.D.8., we

recognize that some areas classified

-under subpart 2 may' need additional

time beyond the statutory attainment

date for their current classification to

attain the 8-hour standard as

expeditiously as practicable. In the

event an area cannot practicably attain

by the maximum date for its

classification, the CAA provides the

opportunity for more time. An area

regulated under subpart 2 can receive a

later maximum attainment date. through

a State request to bump-up to a higher

classification (e.g. from moderate to

serious). Although a higher

classification would mandate additional

control measures, in fact there may not

be additional mandatory control

measures required because the area may

already have such measures because of

its classification for the 1-hour standard

and the anti-backsliding provisions.

However, an area that needs more time

to attain may also need additional

emissions reductions to reach

attainment. The'e reductions may be

achieved through implementation of

measures that are necessary to

demonstrate RFP requirements or

additional reductions beyond RFP may

be needed. Preliminary analyses

indicate that already required control

measures (e.g., motor vehicle and

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nonroad-engine rules, CAIR, etc.) may

largely or fully fulfill RFP requirements

'for many areas'and that they will

provide substantial progress toward

attainment for most areas.

Many areas may have significant

creditable reductions as a result of

Federal motor vehicle and nonroad

rules, the NOx SIP Call, and the CAIR.

With the statutory exceptions

enumerated above, assured emissions

reductions that will occur in an area

after the base year can be credited

toward meeting an RFP emission

reduction milestone.

To reduce interstate ozone transport,

the CAIR (described above in section

IV.B.) established statewide ozoneseason NOx budgets for 25 States and

the District of Columbia (i.e., the eastern

part of the U.S.where all 8-hour

nonattainment areas are classified as

moderate or below). As noted above, the

first phase of NOx reductions under

CAIR starts in 2009 (covering 2009-

2014); the second phase of NOx

reductions begins in 2015 (covering'

2015 and thereafter).-

With respect to timing of reductions,

the following table shows how

summertime NOx reductions from local

CAIR sources that will be achieved by

May 1, 2009, or earlier can assist in

demonstrating RFP.

Type of 8-hour nonattainment area RFP requirement* Relationship of CAIR and RFP

-Subpart 1 areas with attainment dates within Meet RFP through showing of expeditious at- CAIR reductions not required prior to ozone

5 years of designation; tainment. season preceding latest attainment date.

%---Subpart 2 moderate areas for which of expeditious attaihment is no later than 5 years

after designAtion.

Subpart 1 areas with attainment dates 6-10 Must demonstrate RFP through their attain- CAIR reductions in 2009 can help fulfill RFP

years from designation. ment date. requirement.

Subpart 2 marginal areas .................... No subpart 2 RFP requirement for marginal Not applicable.

areas.

Subpart 2 moderate areas with an attainment Subject to RFP similar to subpart 1 areas; CAIR NO× reductions in 2009 can help fulfill

date later than 5 years after designation. must demonstrate RFP through their attain- RFP requirement.

ment date.

Subpart 2 moderate-and-above areas that did 15% VOC reduction required between 2002 CAIR 2009 NOx reductions can help demnot implement 15% VOC reductions for 1- and 2008; continued progress required onstrate continued progress after 2008 athour ozone standard, through attainment date. tainment date.

RFP requirement descriptions in table are abbreviated; RFP requirements are more precisely described elsewhere in preamble and rule text.

The CAIR provisions do not require

States to require emissions reductions

prior to January 1, 2009. However,

States may choose to require or some

sources may elect to apply CAIR-level

NOx controls earlier than that date. If

such controls are made enforceable in

the SIP (e.g., through a specific rule), the

State may take RFP credit for such

emissions reductions for the RFP period

(i.e., an RFP period ending earlier than

'December 31, 2008) during which the

reductions occur.

The RFP-provisions in the CAA for

both subpart 1 and subpart 2 areas

require .that actual emissions be reduced

from the baseline by the milestone year.

Only emissions reductions required to

be achieved during an RFP period may

be credited toward the State's RFP

obligation for that period. In developing

their RFP plans, States will have to

provide their best estimate of the CAIRaffected sources that are expected to

actually reduce emissions to meet the

CAIR requirements and those that are

expected to meet CAIR through holding

allowances and not actually reducing

emissions.

Local CAIR NOx reductions that

States must require by May 1, 2015,

could assist in meeting RFP for an area

that is bumped up to severe anddemonstrates attainment cannot be

achieved before the end of the 2015

ozone season.

b. Summary of Final RFP Features

We are adopting nbarly all the

approaches set forth in our proposed

rule forthe various 8-hour RFP issues.

We are making exceptions where

convincing arguments were presented

by commenters for a suitable alternative

or where, through reassessment of the

issue, EPA was able to develop a better

option that still reflects the concepts in

the original proposal. The issues for

which we have adopted approaches that

vary from the proposal are: (a) The

timing of the submission of the RFP

plan; (b) the structuring of RFP

requirements in subpart 1 areas; (c) the

implementation of RFP in areas

designated for the 8-hour ozone

standard that entirely or in part

encompass an area that was designated

nonattainment for the 1-hour ozone

standard; and (d) the substitution of

controls from outside the nonattainment

area within 100 kilometers (km) for VOC

and 200 km for NOx. These changes are

discussed in the sections below.

In developing an approach for

addressing the RFP requirements for the

8-hour ozone standard, we are adopting

the following:

# The same baseline year would be

used both to address growth (in

emissions, vehicle miles traveled (VMT)

or otherwise) and to calculate the RFP

target level. The baseline year of 2002

applies for areas with an 8-hour ozone

nonattainment designation effective in

June 2004.

- Emissions reductions from outside

the nonattainment area up to 100 km for

VOC and 200 km for NOx (and

statewide for areas that are part of a

regional strategy) would be allowed

consistent with (a) the concepts in

EPA's existing December 1997 interim

implementation policy for 1-hour ozone

NAAQS 34, and (b) with the constraint

that in all cases the distances in the

policy provide only a general policy

presumption that, if used, would need

data in the record showing that

reductions from sources in the specific

locations, outside the nonattainment

area benefit the nonattainment area.

This is discussed further below in

section IV.E.12. of this preamble.

* For all 8-hour nonattainment areas

classified under subpart 2 as moderate

34 Memorandum of December 29, 1997 from

Richard D. Wilson to Regional Administrators,

Regions I-X re "Guidance for Implementinrg the 1-

Hour Ozone and Pre-Existing PMIO NAAQS."

Located at URL: http://www.epa.gov/ttn/oorpg/tl/

memoranda/iig.pdf. This policy recognized that

VOC emissions up to 100 km and NOx emissions

up to 200 km from the nonattainment area could be

relied on for RFP. Those distances resulted from

Federal Advisory Committee Act discussions cited

earlier and generally represent transport of 1 to 2

days. We still believe it is appropriate to allow this

credit. However, as noted below, because we

received concerns about this policy outside the

rulemaking process, we are in the process of

subjecting this policy to a technical review and may

revise it in light of that review.

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and above that had not met the 15

percent VOC emission reduction

requirement for the 1-hour standard, the

RFP requirements specified in subpart 2

would apply, namely'a 15 percent VOC

emission reduction, accounting for

growth, in the first 6 years after the

baseline year for moderate and above

ozone nonattainment areas. In addition,

for all 8-hour nonattainment areas

classified as serious and above, the RFP

provisions in subpart 2 require a VOC

or NOx emission reduction of at least

three percent per year averaged over

each consecutive 3-year period

beginning 6 years after the baseline year.

(See section 182(c)(2)(B)).

* Areas classified under subpart 2 as

moderate that had met the 15 percent

VOC emission reduction requirement

for the 1-hour standard are treated in the

final rule like areas covered under

subpart 1.

* Areas classified under subk~art 2 as

serious and above that had met the 15

percent VOC emissiofi reduction

requirement for the 1-hour standard

would be subject to the RFP

requirement in section 172(e) and the

final rule would require them to obtain

an average of 3 percent annual

reductions of VOC and/or NOx

emissions reductions for the first 6 years

after the baseline year and every

subsequent 3 years out to their

attainment date.

* The periods for RFP under subpart

2 for the 8-hour ozone NAAQS run from

the date of the baseline year; and would

be equivalent to the periods Congress

established in subpart 2, which applied

for the 1-hour NAAQS. Thus, the first

15 percent reduction would be required

for the 6-year period starting after the

end of the last day of the baseline year

(e.g., January 1, 2003-December 31,

2008). The first 3-year period for the

subsequent (average of) three percent

per year emission reduction

requirement in serious and higher areas

would begin 6 years after the end of the

last day of the baseline year (e.g.,

January 1, 2009-December 31, 2011).

However, the last period for any area

would end on the attainment date for

the area.

* Subpart 1 areas with attainment

dates 5 years or less after designation

can meet the RFP requirement by

achieving the emission reductions

necessary to attain as expeditiously as

practicable. These emissions reductions

must be implemented by the beginning

of the full ozone season prior to the

attainment date (See 40 CFR § 1.908). 3 5

For subpart 1 areas with attainment

35 With today's rulemaking, this provision is now

codified as 40 CFR 51.908(d).

dates beyond 5 years after designation,

the RFP SIP must provide for a 15

percent emission reduction (either NOx

and/or VOC) from the baseline year

within 6 years after the baseline Year.

For each subsequent 3-year period out

to the attainment date, the RFP SIP

would have to provide for an additional

increment of progress. The increment

for each 3-year period would be a

portion of the remaining emission

reductions needed for attainment

beyond those reductions achieved for

the first increment of progress (e.g.,

beyond 2008 for areas designated

nonattainment in June 2004).

Specifically, the amount of reductions

needed for attainment should be

divided by the number of years needed

for attainment after the first increment

of progress in order to establish an "annual increment." For each 3-year

period out to the attainment date, the

area must achieve roughly the portion of

reductions equivalent to three annual

increments.36

* Subpart 2 moderate or higher areas

that had not met the 15 percent VOC

reduction requirement under the 1-hour

standard would be subject to section

182(b)(1) for the 8-hour standard and

would need to obtain the emissions

reductions within 6 years after the

baseline year (e.g., for areas designated

in June 2004, the reductions would need

to occur by the end of 2008, based on

a baseline year 2002).

* Reductions from any Federal and

regional measures promulgated after

1990 (except those measures that were

not creditable under the CAAs

creditability provisions (section

182(b)(1)(D)) and achieved after the

baseline year are creditable for the RFP

requirement.

* Allow use of the "Clean Data

Policy."

c. Comments and Responses

This set of comments and responses

on our proposal on RFP are of a general

nature. Comments and responses on

specific topics appear with the sections

below on those topics.

Comment: One commenter stated that

EPA's proposed 8-hour ozone rule

36 For example, if the area's attainment date is

2014,.and a total of 30 percent reduction is needed

between the end of 2008 and the attainment date

(a 6-year period) to reach attainment, the "annual

increment" would be 5 percent (i.e., 1/ of 30

percent). Thus, the area must achieve roughly the

portion of reductions equivalent to three annual

increments or 15 percent during the first 3 years

(2009, 2010, 2011), and the remaining amount over

the next 3 years (2012, 2013, 2014). Additional

discussion of what is meant by "roughly

proportional" appears in he full discussion of RFP

for subpart 1 areas in section Iv.E.7. of this

preamble.

would sharply slow momentum to

implement health protective emission

reduction strategies in areas with

unhealthful air quality. It would curtail

the effectiveness of transportation

conformity in areas with inadequate air

quality, including both old and new

ozone nonattainment areas. It would do

this by proposing to eliminate any

further RFP requirements for pollution

reduction in existing 1-hour ozone

areas. Response: The EPA has developed

anti-backsliding provisions to ensure

continuing progress toward attainment

of the ozone NAAQS. Under these

provisions, areas that are nonattainment

for the 8-hour standard must continue to

meet most obligations for the 1-hour -

standard, including RFP requirements.

Those provisions (adopted as part of the

Phase 1 Rule published April 30, 2004)

will ensure areas maintain progress in

achieving emissions reductions in areas

With unhealthful air quality.

Additionally, 8-hbur ozone

nonattainment areas with attainment

dates later than 5 years after designation

must meet specified increments of

reductions as provided in more detail

below.

Comment: Another commenter

recommends that EPA not strictly

interpret the CAA requirement of a 15

percent reduction in VOC in the first 6

years. If reductions in VOC would not

assist the area in progress toward

attainment and if an area can provide an

analysis that it is at least as sensitive to

NOx controls, then- the area should be

able to reduce NOx emissions for RFP

requirements. . Response: We addressed in general

those comments that recommended

alternatives to the mandatory measures

of subpart 2 (which. includes the RFP

requirement) in the response to

comments above under the topic,

"Should prescribed requirements of

subpart 2 apply in all 8-hour

nonattainment areas classified under

subpart 2, or'is there flexibility in

application in certain narrowly-defined

circumstances?" We conclude in that

section that EPA has no discretion to

broadly waive mandatory requirements.

However, we noted that case law may

provide support for case-by-case

waivers where implementation of a

measure would produce an absurd

result.

Comment: One commenter stated that

EPA should.consider highly readtive

VOC reductions that achieve ozone

reductions equivalent to an average of 3

percent per year reduction of VOC and/

or NOx as meeting RFP requirements.

Response: The CAA's RFP provisions

do not appear to provide for variations

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in the required percent reduction in

VOC based on differences of reactivity

of the various VOC compounds.

IHowever, EPA is participating with a

group called the Reactivity Research

Working Group, along with

representatives from States, industry

and universities, to study the scientific

aspects of reactivity and to try to

determine if more cost-effective and

greater-ozone reductions can be

achieved through use of the concept.

The requirement to obtain the required

percent reduction of total VOCs

remains, and if EPA decides to propose

a change, it would be undertaken in a

separate rulemaking action.

2. What is the content and timing of the

plan for addressing the RFP

requirements under section 182(b)(1)

and 182(c)(2)(B) for areas covered under

subpart 2?

[Section VII.3 of June 2, 2003

proposed rule (68 FR 32833);

§ 51.910(a)(1)(ii) of the draft and final

regulatory text.]

a. Background

Section 182(b)(1) requires areas

classified as moderate and above to

submit a plan to achieve a 15 percent

reduction in VOC emissions over a 6-

year period following the baseline year.

Section 182(c)(2)(B) requires serious and

above areas to achieve an average of

nine percent additional emissions

reductions for each subsequent 3-year

period. We proposed two options

regarding how this requirement might

apply for purposes of inplementing the

8-hour NAAQS.

(i) Option 1. Require 15 percent VOC

reductions within 6 years after the

baseline year for all areas designated

moderate and above for the 8-hour

ozone NAAQS. After 6 years, all serious

and above areas would be required to

achieve a nine percent reduction in

VOC and/or NOx emissions every 3

years, i.e., an average of three percent

per year, until attainment.

(ii) Option 2. For those areas that have

an approved 15 percent plan for their 1-

hour ozone SIPs, an additional 15

percent VOC reduction is not necessary.

Subpart 2 areas that have'approved 15

percent plans for the 1-hour ozone

standard would be considered to have

met the statutory 15 percent

requirement. Instead, such an area that

is classified as moderate for the 8-hour

standard would be subject to the general

RFP requirements of subpart 1 in the

same manner as subpart I areas. Such

an area that is classified as serious and

above for the 8-hour standard would be

subject to the RFP requirement in

section 182(c)(2)(B) and would have to

include in their SIPs an RFP plan that

would achieve an average of three

percent per year of VOC and/or NOx

over each 3-year period starting at the

end of the baseline year out to their

attainment year.

We recognized in the proposal that for

serious and above areas it would be

difficult to adopt and implement

emission controls that would provide

for the first nine percent emission

reduction within 3 years after

nonattainment designation. Therefore,

consistent with what Congress did

under section 182(b)(1), we proposed to

allow the first RFP increment to be

averaged over 6 years. We proposed that

an area classified serious or above

submit its RFP plan within 2 years after

designation such that it provides for 18

percent emissions reductions (VOC and/

or NOx) over the first 6 years from the

baseline year (e.g., January 1, 2003 to

December 31, 2008 using the proposed

2002 baseline year). Then, within 3

years after designation, submit a plan

that-provides 9 percent emissions

reductions (VOC and/or NOx) over each

of the next 3-year periods until the

area's attainment date (e.g., from

January 1, 2009 to the attainment date).

The proposal noted that this option

recognizes previous efforts by areas that

submitted 15 percent plans as required

under the 1-hour ozone NAAQS and

provides flexibility to States to use a

mix of NOx and VOC reductions as

appropriate to meet the additional ROP/

RFP requirements. For many areas of the.

country, particularly in the Eastern U.S.

outside major metropolitan areas, there

is a greater need for NOx reductions

rather than VOC reductions to bring

about reduced ambient ozone levels.

*Areas do not have the flexibility to

control NOx under the 15 percent

requirement-NOx substitution is only

allowed under section 182 for the post1996 RFP requirement (three percent

per year averaged over 3 years). We

believe that the statute can be

interpreted to require the mandatory 15

percent VOC reduction only once for a

given area.. Once the 15 percent VOC reduction

requirements have been met, an area

would instead be subject to the other

RFP requirements of the CAA. In some

cases, such as for serious and above

areas, this might result in an obligation

to achieve greater emissions reductions,

i.e., 18 percent rather than 15 percent

forthe 6-year period, but the area would

have the flexibility to choose either VOC

or NOx reductions as appropriate. We

indicated in the proposal that we

preferred this second option because it

provides more flexibility for the RFP

plan tb be consistent with the area's

needs in attaining the standard. The

draft regulatory text incorporated this

option.

The proposal did not specifically

address an 8-hour area that is partially

comprised of one or more 1-hour ozone

nonattainment areas with approved 15

percent plaits and one or more areas that

were not previously subject to the 15

percent requirement.

b. Summary of Final Rule

We are adopting the second option

described in the Background above, as

adjusted in response to comment.

1. Final rule for 8-hour areas

comprised in total of one or more 1-hour

nonattainment areas with approved 15

percent plans for the 1-hour standard.

Those 8-hour areas that are composed

entirely of one or more 1-hour areas that

have approved 15 percent plans for their

1-hour ozone SIPs, will be considered to

have met the 15 percent VOC

requirement in section 182(b)(1). Such

areas that are classified as moderate

would instead be subject to the more

general RFP requirements of subpart 1.

As discussed below, the subpart 1

requirement would depend on the

moderate area's attainment date as

follows:

* Moderate areas that have an

attainment date of 5 years or less after

their 8-hour designation, for which all

portions of the area have previously met

their 15 percent requirements under the

1-hour standard, will be subject to

subpart 1 RFP requirements, which will

be satisfied with measures that

demonstrate attainment as expeditiously

as practicable.

* Moderate areas that have an

attainment date beyond 5 years after

their 8-hour designation, for which all

portions of the area have previously met

their 15 percent requirements under the

1-hour standard, will be subject to

subpart 1 RFP requirements, which will

be satisfied with a plan to demonstrate

15 percent emissions reductions (which

may be either VOC or NOx or a

combination of both) from 2002 to 2008,

and any additional emission reductions

needed for attainment beyond 2008.

Such aras that are classified as

serious or above would be subject to the

RFP requirements of section 182(c)(2)(B)

and would need to submit a plan

achieving an average of 3 percent

reductions per year over the 6 years

following the baseline year and then an

average of 3 percent per year for each

subsequent 3-year period out to the

attainment year.

37

37 As discussed below in section 5 (the discussion

of the timing of submission of the RFP plan) the

RFP plan would have to be submitted within 3

years after designation (not 2 years as proposed).

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2. Final rule for 8-hour areas

comprised in part of one or more 1-hour

attainment areas with an approved 15

percent plan for the 1-hour standard and

in part of one or more areas without

approved 15 percent plans for the 1-

hour standard.

For 8-hour moderate areas that

include all or part of one or more 1-hour

areas with an approved 1-hour 15

percent plan, but also include areas that

were not subject to the ,1-hour 15

percent plan, the final rule would Allow

the area to choose between two

alternative approaches that are

consistent with the proposed rule.

e. Approach 1. Develop a new

baseline and new 8-hour 15 percent

VOC ROP emission reduction target for

the entire 8-hour area. Emissions

reductions that occur after the 2002

baseline emissions inventory year are

creditable except as limited by section

182, as described elsewhere in this final

rule. The reductions must be of VOC

only.

* Approach 2.

* Treat the 8-hour nonattainment area

as divided between portions of the area

that are subject to an approved 15

percent VOC-only plan for the 1-hour

standard and the portions of the area

that are not'subject to a 15 percent plan

for the 1-hour standard.

* For those areas not subject to an

approved 15 percent plan for the 1-hour

standard, States must establish a

separate 15 percent VOC target under

subpart 2. VOC emissions reductions to

meet the 15 percent requirement may,

however, come from across the entire 8-

hour nonattainment area.

* For the portion of the area with an

approved 15 percent plan for the 1-hour

standard, the subpart I RFP

requirements -will apply if the area is

classified as moderate for the 8-hour

standard and the section 182(c)(2)(B)

RFP requirement will apply if the area

is classified as serious or above for the

8-hour standard. These requirements

would apply as described above for

areas comprised entirely of areas with

approved 15 percent plans for the 1-

hour standard.

c. Comments and Responses

Comment; One commenter expressed

concern that for a number of subpart 2

areas that were nonattainment for the 1-

hour standard, especially those

dominated by mobile source emissions

and/or those with existing stringent

stationary source controls, it may be

difficult to achieve another 18 percent

* precursor emission reduction within 6

years from the baseline year and then an

additional 3 percent per year precursor

reduction after that until the area's

attainment date. Specific areas were

mentioned such as the South Coast

District of California and the HoustonGalveston Area, which the commenter

indicated will be well beyond best

available control technology (BACT)

controls and in some cases at or near

lowest achievable emission rate (LAER)

NOx controls on stationary sources

making them dependent on mobile

source fleet turnover for SIP RFP

emissions reductions. The commenter

further suggested that EPA should have

available approved policy options that

allow areas in such predicaments to

maintain approved SIPs if additional

emissions reductions are not available

to meet RFP requirements and/or if

available emission reduction techniques

might be counterproductive to other

local and regional air quality goals.

Response: We addressed in general

those comments that recommended

alternatives-to the mandatory measures

of subpart 2 (which includes the RFP

requirement) in the response to

comments above under the topic,

"Should prescribed requirements of

subpart 2 apply in all 8-hour

nonattainment areas classified under

subpart 2, or is there flexibility in

application in certain narrowly-defined

circumstances?" We concluded in that

section that EPA has no discretion to

broadly waive mandatory requirements.

However, we noted that case law may

provide support for case-by-case

waivers where implementation of a

measure would produce an absurd

result. Additionally, we note that

section 182(b)(1)(A)(ii) specifically

addresses the situation where an area

demonstrates that it cannot achieve the

required 15 percent reduction. It

provides that an area may achieve less

than the 15 percent VOC reduction

required where the State demonstrates

(1) NSR requirements apply as they

would in an area classified as extreme

except that the terms "major source"

and "major stationary source" shall

include any source with the potential to

emit at least 5 tpy of VOCs; (2) RACT

is required for all major sources (i.e., a

source with the potential to emit at least

5 tons per year of VOCs; and (3) the plan

includes all measures that can feasibly

be implemented in light of technological

achievability. 38 .

Comment: Another commenter

supported EPA in recognizing the

previous efforts of areas to meet ROP

requirements under the 1-hour standard.

The commenter concurred with EPA's

38 Section 182(c)(2)(B)(ii) also contains a similar

RFP provision for serious and higher classified

areas that allows less than 3 percent of baseline

emissions each year after the initial 15 percent

reduction after designation and classification.

preferred option, which allows States

the flexibility to choose a combination

of NOx and VOC strategies to meet ROP/

RFP requirements consistent with an

area's need to meet the standard.

Response: We agree with the

commenter that if an area has already

met the 15 percent VOC emission

reduction requirement for the 1-hour

standard, the area should not be

required to meet that requirement a

second time for the 8-hour standard but

instead will be subject to the other

applicable RFP provisions of the CAA.

Comment: One commenter preferred

Option 1 as more protective of air

quality and more consistent with the

requirements of the CAA. Option 1

would require'States to develop RFP

plans based on severity and local

situation. Option 2 has some attractive

features by recognizing progress that

States have already made. This

commenter believed that Optiorl 2 is

problematic, however, because it relies

on plans developed based on 1990 to

1996 emissions. This time period has

passed.

One commenter believed EPA to be

completely without authority to waive

the 15 percent RFP plan requirement,

which is an explicit mandate of subpart

2. A 15 percent ROP plan under the 1-

hour standard cannot possibly satisfy

the 15 percent RFP plan obligation for

the 8-hour standard, because the new

RFP requirement i designed to

implement a revised NAAQS and is

measured from a different baseline year.

They further believe that EPA offers no

plausible legal rationale for waiving the

15 percent ROP requirement, and,

indeed, none exists. Moreover, although

the agency proposed to require RFP

demonstrations for the first 6 years for

serious and severe areas, there is no

lawful or rational basis for exempting

moderate areas from this statutory

requirement. Allowing States to rely on

their 1-hour 15 percent ROP

demonstrations is further unsupportable

because those demonstrations are

almost certainly no longer valid.

Response: The EPA acknowledges

that under subpart 2 we must require 15

percent VOC reductions for all moderate

and above areas, but we maintain that

if an area has met this requirement

while subject to section 182(b)(1)(A).for

the 1-hour standard, they will not have

to meet it again for the 8-hour standard.

The EPA believes that the CAA is quite

clear that-the SIP must provide for a 15

percent reduction in baseline VOC

emissions for some period after 1990 in

an area subject to section 182(b)(1)(A),

and, consequently, the SIP for any area

newly subject to section 182(b)(1)(A)

must provide for a 15 percent reduction

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in VOC baseline emissions. -But, EPA

disagrees that the CAA plainly requires

that the SIP for an area must require a

second 15 percent reduction in VOC

baseline emissions under a revised

ozone standard. The EPA believes that

section 182(b)(1)(A) limits our

discretion only to the extent that we

cannot let the SIP for any area clalsified

as moderate or worse for the 8-hour

standard avoid a demonstration that the

SIP contains sufficient measures to

achieve a 15 percent reduction'in VOC

baseline emissions and further limits

our discretion to allow NOx substitution

for the 15 percent RFP demonstration

requirement under section 182(b)(1)(A).

If serious and above areas have

already met the 15 percent requirement

under the 1-hour standard, they must

- meet the next RFP requirement, namely,

the section 182(c)(2)(B) RFP

requirement, which will actually

achieve greater reductions, i.e., 3

percent per year over 6 years for a total

of 18 percent, but they can meet it with

either VOC or NOx reductions. For

moderate areas that have already met

the 15 percent VOC emission reduction

requirement for the 1-hour standard,

EPA believes appropriate RFP under

subpart 1 should be achieved. For

purposes of RFP under subpart 1, there

is nothing that limits such reductions to

VOC. This provision simply requires

reasonable annual incremental

reductions towards attainment by the

applicable attainment date, and this

could be achieved by either VOC or

NOx emissions reductions or a

combination of both.

Settion 182(b)(1)(A). is the only

statutory provision that limits State

discretion to substitute NOx reductions

for VOC reductions. This applies only

for purposes of the initial 15 percent

reduction requirement for the 6-year

period after the baseline year.

Comment: Another commenter

believed the subpart 2 provisions of the

CAA do not allow for NOx for VOC

substitutions for the initial 15 percent

RFP requirements.

Response: We agree that the 15

percent requirement in section 182(b)(1)

does not allow the substitution of NOx.

for VOC. However, the RFP

requirements in section 172(c)(2) and

182(c)(2)(B) are not consfrained by that

'limitation and either VOC or NOx

emissions reductions may be counted

toward meeting RFP under those two

provisions.

Comment: Some commenters believed

an additional 15 percent VOC reduction

should not be necessary for 8-hour areas

that encompass in whole or in part a 1-

hour nonattainment area with an

approved 15 percent plan. Such areas

should simply be required to achieve

whatever NOx or VOC emissions

reductions are needed for attainment.

One commeriter noted that the

proposed § 51.910(a)(ii) did not address

all boundary change scenarios

consistent with our proposed approach

found in section VI.I.9. of the June 2,

2003 proposed rule (68 FR 32835).

Response: We agree with the

commenter that an area with an

approved 15 percent plan for the 1-hour

standard is not required to adopt a

second 15 percent plan under section

182(b)(1) for purposes of the 8-hour

standard. However, if a portion of the 8-

hour area was not subject to an

approved 15.percent plan for the 1-hour

standard, section 182(b)(1) applies to

that portion of the 8-hour area and may

be met by one of two approaches

described above and in the regulatory

text. We agree with the second

commenter who noted that the proposed

rule did not explicitly address all

possible boundary scenarios; we believe

we have fully addressed these different

boundary scenarios in the final rule in

a manner consistent with the proposal.

Comment: A commenter indicated

that they preferred to work with EPA in

the development of an alternative that

will eliminate or minimize the planning

burdens associated with development of

a 15 percent RFP plan for one town. One

alternative might be the development of

a "comparability'demonstration,"

showing that the town had implemented

the same controls that had been

previously responsible for achieving a

15 percent reduction in VOCs in the 1-

hour ozone nonattainment areaassociated with the 8-hour

nonattainment area including this town.

Response: We are willing to work

with individual areas as they develop

their 8-hour 15 percent plans and to

help them avoid unnecessary planning

burdens. We believe that the portion of

an 8-hour area not subject to an

approved 1-hour 15 percent plan may be

able to meet the 15 percent obligation

for the 8-hour standard if the area

adopts the same VOC control measures

(for example, VOC RACT at the same

source thresholds, I/M, etc. * * *) as in

the portion of the 8-hour nonattainment

area subject to a 15 percent plan for the

1-hour standard and if the area has the

same mix of emissions sources as in the

area subject to the 15 percent plan for

the 1-hour standard. We anticipate we

could propose approval of a SIP on this

basis where supported by the record.

Comments on Draft Regulatory Text

Comment: Another commenter

generally supported the RFP provisions

but suggested that in section

51.910(a)(1)(ii)(A) of the draft regulatory

text, we insert the language shown in

bold:

"An area classified as moderate or

higher that has the same boundaries as

an area for which EPA fully approved a

15 percent plan for the 1-hour NAAQS

is not subject to section 182(b)(1) of the

CAA for the 8-hour NAAQS, but

instead-(A) If classified as moderate, is

subject to RFP under section 172(c)(2) of

the CAA and shall meet that obligation

by submitting 3 years after the effective

date of its designation a SIP revision

that prQvides for implementation of all

emission reductions of VOCs and/or

NOx needed for attainment by the

beginning of the ozone season in the

area's attainment year." The commenter

claimed this language is consistent with

the approach EPA has taken in other

provisions of this draft.

Response: The commenter's concern

is noted. Section 51.910 has been

restructured for reasons noted elsewhere

in this preamble and it addresses the

commenter's concern.

Comment: One commenter suggested

that § 51.910(a)(3) of the draft regulatory

text be revised to allow (even if

conditional) NOx reductions to be

substituted for VOC reductions (for any

ROP or RFP requirement) whenever

such reductions would "result in a

reduction in ozone concentrations at

least equivalent to that which would

result from the amount of VOC emission

reductions required."

Response: As noted above we do not

believe the CAA allows substitution of

NOx for VOC to meet the 15 percent

requirement of section 182(b)(1).

Comment: One commenter stated that

draft § 51.910(a)(1)(ii) eliminates the 15

percent requirement for areas that have

already achieved this requirement under

-the 8-hour standard and supported that

change. However, they further state that

the strict criteria of "same boundaries"

should be revisited because there may

be limited changes in the nonattainment

areas "boundaries" when areas are

designated for the 8-hour standard.

Such changes should not negate this

provision. A broader definition needs to

apply to this section to allow for

changes to boundaries in nonattainment

areas between 1-hour and 8-hour

designations where such changes do not

substantially alter the geographical or

population characteristics for the area.

Another commenter supports an

exemption for 8-hour nonattainment

areas that have met the 15 percent ROP

requirement for the 1-hour NAAQS. The

commenter requests that EPA clarify the

criteria that the area must have the same

geographic boundaries to qualify for the

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exemption. This means that in the

geographic areas for which a State has

an approved 15 percent plan, the 15

percent requirement will not apply; and

the 15 percent requirement is only

intended to apply to the new geographic

areas of the 8-hour nonattainment area,

and that the 15 percent reduction of

emissions from the new areas could

come from the entire nonattainment

area to satisfy this requirement.

Response: As we explain in our

summary of the final rule, we have

recognized that there are a variety of

boundary scenarios for 8-hour

nonattainment areas in relation to the

boundaries of areas for the 1-hour

standard. We have modified the draft

regulatory text such that the 'final rule

speaks in terms of 8-hour areas that

include all or part of an-area with an

approved 15 percent plan for the 1-hour

standard. For those portions of the 8-

hour area with an approved 1-hour 15

percent plan, the 8-hour area is not

required to develop a second 15 percent

plan under section 182(b)(1) for

purposes of the 8-hour standard, but

instead will be subject to section

172(c)(2) if it is an 8-hour moderate area

or subject to section 182(c)(2)(B) if it is

classified as serious or above for the 8-

hour standard. If the 8-hour area

includes both areas that were subject to

an approved 15 percent plan for the 1-

hour standard and areas that were not,

then the 8-hour area can choose whether

to develop a section 182(b)(1) 15 percent

plan for the entire 8-hour area or to

develop a 182(b)(1) plan only for the

area not previously subject to such a

plan and to treat the remaining portions

of the area under section 172(c)(2) or

182(c)(2)(B), as described above.

As noted, EPA does not believe the

statute allows it to relieve any area that

has not already met the 15 percent

requirement for the 1-hour standard

from the obligation to meet that

requirement except as provided in

section 182(b)(1)(A)(ii).

3. What baseline year should be

required for the emissions inventory for

the RFP requirement?

[Section VI.I.4. of June 2, 2003

proposed-rule (68 FR 32833); § 51.909 of

the draft regulatoiy text; § 51.910(d) of

the final regulatory text.]

a. Background

The baseline inventory for RFP (under

subpart 2) is used as the starting point

for the determination of a target level of

emissions for the future year RFP and as

the baseline from which creditable

reductions are determined. We

designated ozone nonattainment areas

in April 2004. Under the "Consolidated

Emissions Reporting Rule" (67 FR

39602; June 10, 2002) revised emissions

inventories are required for the years

2002 and 2005; therefore, we proposed

to require use of the 2002 inventory as

the baseline inventory for the RFP

requirement. This would be the most

recent inventory available at the time of

designation. We issued a memorandum

identifying 2002 as the anticipated

emissions inventory base year for the

SIP planning process to address the 8-

hour ozone and the PM2.

5 standards. 39

b. Summary of Final Rule

As set forth in our proposed rule, for

areas designated nonattainment for the

8-hour ozone NAAQS with an effective

date of June 15, 2004, we are requiring

States to use the 2002 inventory as the

baseline inventory for the RFP

requirement. As noted in the proposal,

the inventory for the 2002 calendar year

would be the most recently available

inventory at the time of designation in

2004. However, in response to several

comments, we are allowing States the

option of justifying theuse of an

alternative baseline inventory year for

RFP. To justify an alternative, the State

would have to demonstrate how the

alternative year meets the CAA's

provisions for RFP and provide a

rationale for why it is appropriate to use

the alternative baseline year rather than

2002 to comply with the CAA's RFP

provisions. We believe that for multiState nonattainment areas, several States

must agree on a single baseline. Even if

a State chooses an alternative baseline

inventory year for RFP, 2002 remains

the valid baseline year for transportation

conformity purposes as described ih 40

CFR 93.119. The baseline year test is

used only in conformity determinations

prior to the submission of a SIP that

establishes motor vehicle emissions

budgets (e.g., an RFP SIP), Therefore,

areas using the baseline year test would

continue to use 2002 as the baseline

year for conformity purposes because an

area's baseline year would not be

changed until an RFP SIP is submitted.

Once an RFP SIP is submitted and the

motor vehicle emissions budgets in that

SIP are found ade'quate or are approved

the area would no longer use the

baseline year test. Instead the area

would use the adequate or approved

budgets in the RFP SIP in conformity

determinations.

39 Memorandum of November 18, 2002, from

Lydia Wegman and Peter Tsirigotis, "2002 Base

Year Emission Inventory SIP Planning: 8-hr Ozone, .

PM 2.

5 and Regional Haze Programs." This document

is available at thefollowing Web site: http://

www.epa.gov/ttn/oarpg/

meta.442.I1.2002baseinv.pdf.

The baseline emissions inventory is

calculated as of the effective date of an

area's nonattainment designation using

the most recent calendar year for which

a complete inventory is required to be

submitted to EPA under subpart A of 40

CFR part 51, subpart A. Under 40 CFR

part 51, subpart A, States are required

to submit a comprehensive inventory on

3-year cycles within 17 months after the

close of the reporting period. Thus, the

"2002 inventory was.due 17 months after

the December 31, 2002 close of the

reporting period, i*e., was due by June

1, 2004. For those areas designated

nonattainment for the 8-hour ozone

NAAQS effectivp June 15, 2004 (69 FR

23858; April 30, 2004), the baseline

emissions inventory should be based on

the calendar year 2002 because the 2002

inventory was due under 40 CFR part

51, subpart A, prior to the time of

designation. For areas'with an effective

nonattainment designation in the future,

the baseline inventory will be for the

calendar year of the most recent

triennial inventory as of the date of

designation.4° As provided above, the

State may use an alternative baseline

only if it is- demonstrated that it is

consistent with the CAA and the State

demonstrates why it is appropriate.

c. Comments and Responses

Comment: Some commenters agreed

there is a reasonable basis to select 2002

as the date of emissions inventories for

the purpose of establishing creditaible

reductions from the inventory. States

are not required by the CAA to adopt

the year of the nonattainment

designation for the 8-hour standard as.

the basis for their planning, even though

that was the case under the 1990 CAA

Amendments. The commenter claims

there are a variety of measures that

would be implemented after 2002 that

local jurisdictions would like to be able

to account for as new emissions

reductions in their modeling

demonstrations. The commenter thus

believes that reductions between these

years "should count." In addition, this

was the most recent quality assured/

quality controlled inventory used to

support'the States' recommendations for

proposed nonattainment designations

on July 15, 2003.

Several commenters recommended

that the baseline year (starting the 6-year

period for RFP) be set for the year in

which designations were made (i.e.,

2004).

40 For example, where the effective date of

designation to nonattainment for an area for the 8-

hour ozone NAAQS is after June 1, 2007 but before

June 1, 2010, the baseline inventory will be for

calendar year 2005.

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Response: The EPA has decided to

establish' 2002 as the baseline year for

RFP SIPs in conformity with both the

language of the CAA and the inventory

year cycle. Of reasonable importance is

the need to maintain consistency with

the periodic inventory for use in various

milestone considerations such as RFP,

milestone compliance demonstration,

attainment, and contingency plans. In

addition, while there would be a

difference in the RFP, requirement based

on the choice of the RFP baseline, there

should be little if any difference in

terms of emissions reductions needed to

demonstrate timely attainment. If we

use 2002, the baseline may be higher but

areas can take credit for any 2002-2004

emissions reductions from federally

enforceable control measures. If we use

2004, the baseline may be lower but

areas can't take credit for measures that

produce emissions reductions between

2002-2004. Depending on the area, the

difference should be minimal in terms

of the difference in the amount of

reductions needed to reach attainment

and what new measures are necessary to

get there. We believe it is reasonable. to

select an inventory year for which States

were already required to produce an

inventory rather than requiring States tQ

produce an additional inventory (e.g.,

for 2004) that is not-otherwise required.

Moreover, requiring the use of an

inventory for the designation year

would cause delay, as it would take the

States 1-2 years after the end of 2004 to

produce the inventory which would be

the basis for selecting controls to

achieve the necessary reductions for

RFP and for modeling attainment.

However, we are allowing States the

option of justifying the use of an

alternative baseline emission inventory,

provided it meets the requirement of the

CAA's RFP provisions. As noted above,

the use of an alternative year for the

baseline inventory for RFP does not

change the requirement to use 2002 as

the baseline year for transportation

conformity as described in 40'CFR

93.119.

- Comment: Another commenter

referred to EPA's proposal language

regarding the RFP SIP that would have

required-submission of the RFP plan

within 2 years after designation. They

stat~d that EPA is missing the point in

that the attainment and RFP submission

dates established in subpart 2 are to

allow States a sufficient amount of time

to achieve the mandated goals.

That commenter referred to another

alternative that would amend the

proposal to require a 1990, rather than

2002 baseline for those areas not having

a previously-approved 15 percent RFP

plan. They further commented that

although a 1990 baseline would not

eliminate the planning burden

associated with this requirement, it

would go far towards minimizing the

necessary additional work.

Response: We disagree with the

commenters who urged use of the 1990

inventories as the baseline for planning

for the 8-hour NAAQS. Use of the 1990

baseline would be unreasonable now

since it would have to be substantially

recalculated due to changes in emission

calculating methodologies. Furthermore,

a 1990 inventory was only.required for,

nonattainment areas as of enactment of

the 1990 CAA Amendments and

therefore may not exi'st for a number of

areas that are currently designated

nonattainment for the 8-hour standard.

Finally, we believe that reliance orl

emissions reductions that may have

occurred well before 8-hour

designations and classifications should

not be counted as making progress

toward attainment.

Comment: Another cominenter noted

that the 18 percent reduction for serious

areas would have to be achieved by

2008. This is 6 years after the base year.

The commenter noted that the 2 years

that would remain after SIP submission

(from the proposed SIP due date of 2006

until 2008) would be totally inadequate

to achieve either the 15 percent

reduction in VOCs or the-18 percent

reduction in VOCs and/or NOx. The

commenter noted the CAA provides for

submission of RFP plans within 3 years

(from 1990) in section 182(b)(1)(A) and

4 years in section 182(c)(2).

Response: The final rule reflects a

change from the proposal to allow

submission of the RFP plan up to 3

years from the date of designation. We

do not believe the RFP provisions. of

subpart 2 of the Act provides relief from

the requirement to obtain the specified

percent reductions from the RFP

baseline within the time constraints.

specified in those provisions.

Comment: A comment on draft

regulatory text § 51.909 noted that EPA

specified various program milestone

dates, which were derived from the

relationship of these dates to the

expected date of initial designation. The

commenter recommends deleting all

such specific date references from the

regulation, to avoid the need for revising

regulations if the initial designations are

not concluded as expected. This should

be replaced by a generic approach, for

example by requiring the most recent

year's data to be used as the baseline in

,the second sentence of § 51.909.

Deleting the calendar-specific dates

would not change the result if the

designations occur as planned, yet

would allow for more recent data to be

used if factors beyond the agency's

control create a delay in designations.

This approach also will allow the

regulation to apply to future area

designation changes, such as areas that

are redesignated nonattainment at some

point in the future. Such specific dates

are more appropriately included as

examples in agency guidance or within

the preamble of a final rule with a

discussion of how they are derived. The

regulation itself should retain only the

generic relationship between the

milestone and the effective date of

designation, which is the approach

taken elsewhere in the rule.

Response: Because the designations

have already taken effect at this point,

we believe it is appropriate to specify

2002 as the presumptive baseline year.

The final version of the rule (now

§ 51.910(d)) provides general language

regarding the appropriate baseline year

for areas that have an effective date of

a nonattainment designation in the

future.41

4. Should moderate and higher

classified areas be subject to prescribed

additional RFP requirements prior to

their attainment date?

[Section VI.I.5 of June 2, 2003

proposed rule (68 FR 32834); no draft

regulatory text; section 51.910(a)(1)(i) of

final regulatory text.]

a. Background

As noted in the proposal, for areas

initially classified moderate and higher

for the 1-hour ozone standard, the

baseline inventory was defined as 1990

in the CAA Amendments. Therefore, the

6-year period for the initial 15 percent

RFP requirement ended in the same year

as the attainment date for moderate

areas, viz., 1996. For areas classified

moderate and higher under the 8-hour

ozone standard, however, we proposed

that the 15 percent RFP target level of

emissions would be calculated for the 6-

year period after the 2002 baseline year,

i.e., 2003-2008. Moderate areas would

be required to meet an attainment date

no later than 6 years after the area is

designated nonattainment for the 8-hour

standard. Since the effective date of

designation of nonattainment areas is -

June 15, 2004, the outside statutory

attainment date would be June 15, 2010.

This leaves approximately a 11/2 year

gap between the end of the 6-year

period for the 15 percent RFP

requirement (i.e., December 31, 2008)

and the maximum statutory attainment

41 We note that even though the draft regulatory

text was structured to place the specification of the

baseline year for RFP (as well as for attainment

demonstrations) in § 51.909, the final rule places

the RFP baseline year requirement in § 51.910.

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date. If we were to also require moderate

areas to obtain an additional three

percent per year emission reduction

beyond 2008 for the 11/2 additional years

out to 2010, the RFP requirement could

be more than what we believe Congress

intended for moderate areas under -

subpart 2. Additional three percent per

year reductions were only required for

serious and higher classified ozone

nonattainment areas. We proposed that

the only specific RFP requirement

applicable for moderate areas is the 15

percent VOC requirement between the

end of 2002 and the end of 2008.

However, section 172(c)(2), which

requires areas to meet RFP generally,

would apply for any period for which

RFP is not addressed in subpart 2. For

purposes of section 172(c)(2), RFP

means annual incremental reductions as

may be required by the Administrator

for purposes of ensuring attainment

[CAA Section 171(1)]. Therefore, we

proposed a moderate area would need to

provide any additional emissions

reductions-VOC and/or NOx-needed

to jrovide for attainment by the area's

attainment date. In proposing this

approach for this circumstance, we

interpreted the subpart 1 RFP

requirement to mean that the area must

achieve whatevei further reduction is

needed for attainment in the remaining

period prior to the attainment date

(2009 through June 15, 2010).

We proposed that serious and higher

classified areas would need to provide

in their SIPs an additional average of

three percent per year emission

reduction over each subsequent 3-year

period beyond the initial 6-year period

through the attainment year, consistent

with what Congress specified in section

182(c)(2)(B) of the CAA.

b. Summary of Final Rule

In the final rule, we are taking the

approach we proposed. We are not

prescribing additional increments of

reductions for the 11/2 years before the

maximum attainment date for moderate

areas. Such areas must provide for any

additional emissions reductions (VOC/

NOx) -needed to provide for attainment

by the beginning of the ozone season

prior to the area's attainment date.4 2

Serious and higher classified areas

would need to provide in their SIPs an

additional average of three percent per

year emission reduction over each

subsequent 3-year period beyond the

42 We note that areas must implement controls

prior to the beginning of the last full ozone season

preceding the attainment date. For moderate areas

designated as of June 15, 2004, such reductions

would be needed by the beginning of the 2009

ozone season.

initial 6-year period through the

attainment year.

c. Comments and Responses

Comment: One commenter suggested

that following the statutory timetable

rather than the one proposed by EPA

would eliminate the problem of how to

handle the "11/2 year gap between the

.end of the 6-year -period for the 15

percent RFP requirement (i.e., December

31, 2008, as proposed by EPA) and the

attainment date." The commenter

continued by saying that no such gap is

contemplated by subpart 2, which

provides in section 181(b)(1) that

moderate area's attainment dates and

their 15-percent VOC RFP date are to be

the same: 6 years after their designation

and classification.

Response: As provided in an earlier

response, we do not believe the'CAA

requires the end of the 15 percent RFPperiod and the attainment date to be the

same. . Comment: Another commenter noted

the proposal states that the only specific

RFP requirement applicable for

moderate areas is the 15 percent VOC

requirement between the end of 2002

and the end of 2008. However, section

172(c)(2) also applies, requiring areas to

meet RFP generally. Therefore, a

moderate area would still also have to

provide any additional emissions

reductions-VOC and/or NOx, i.e.,

whatever is needed to provide for

attainment by the beginning of the

ozone season prior to the area's

attainment date. The commenter agrees

that any additional emissions

reductions needed to achieve attainment

are the only reductions that should be

required of moderate areas.

Response: We agree with the

commenter, and our rule requires that

for-purposes of meeting RFP beyond

2008 until the area's attainment date,

moderate areas must reduce VOC and

NOx emissions as necessary to attain by

the area's attainment date.

5. What is the timing of the submission

of the RFP plan?

[Section VI.I.6 of June 2, 2003

proposed rule (68 FR 32834); § 51.910 of

the draft and final regulatory text

(several locations).]

a. Background

As noted in the proposal, section

182(b)(1) requires that moderate and

higher classified areas submit their 15

percent RFP plans within 3 years after

1990. Obviously, applying the statute as

written is absurd, since we are well past

that date. The CAA uses identical

language for identifying area's

attainment dates under subpart 2. In our

Phase 1 Rule, for purposes of attainment

dates for the 8-hour NAAQS, we

interpreted the CAA's language referring

to the date of enactment of the 1990

CAA Amendments to mean the date of

designations for the 8-hour standard.

We noted in the proposal that if we

applied the same interpretation for RFP

plans, i.e.; that they should be

submitted within 3 years after the area's

nonattainment designation date (i.e., in

2007 if the area has an effective

designation in 2004), the plans would

have to be implemented within 1 year

after submission to ensure the 15

percent emissions reductions are

achieved by the end of the relevant 6-

year period (i.e., December 2008). We

indicated concern that this might not

provide sources with sufficient time to

achieve the reductions by the required

deadline. Therefore, we proposed that

the RFP SIP be submitted within 2 years

after nonattainment designationnamely by 2006 for areas designated in

2004. This would provide for 2 years for

the State to develop and submit its RFP

plan, and another 2 years for the control

measures to be implemented. ,

We also proposed that an area

classified serious or above submit

within 2 years after designation its RFP

plan that provides for 18 percent

emissions reductions (VOC and/or NOx)

over the first 6'years from the baseline

year and then submit within 3 years

after designation a RFP plan that

provides nine percent emissions

reductions (VOC and/or NOx) over each

of the next 3-year periods until the

area's attainment date.

b. Summary of Final Rule

In the final rule, we are taking a

'different approach than proposed in

light of concerns raised by States in

public comments. These commenters

stated that they would need more than

2 years for development, adoption and

submission of RFP plans for the

increment of progress over the first 6

years after the baseline year. The EPA

agrees with the several commenters who

urged that 3 years was more consistent

with the CAA. Additionally, 3 years is

a more reasonable time period for

submission because it allows States the

necessary time to move regulatory

actions through their legislative

processes and allows States to consider

RFP in conjunction with their

attainment demonstrations. Therefore,

for moderate and higher classified areas,

the first RFP SIP must be submitted

within 3 years after the area's

nonattainment designation. For areas

with a June 15, 2004 effective date for

the 8-hour designations, the SIP would

be due by June 15, 2007. This would

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provide up to 3 years for States to

develop and submit RFP plans, and 1

additional year (until the end of 2008)

for control measures to be implemented.

The RFP SIP for any remaining 3-year

periods out to the attainment date

beyond the first 6 years also would be

submitted with the attainment

demonstration, i.e., within 3 years after

designation. However, since States

maintain the flexibility to submit plans

early to provide more time for ,

implementation of their SIP control

measures, we recommend that States

complete their RFP plans as soon as

possible after designation to provide as

much time as possible for sources to

implement the emissions reductions.

Furthermore, States may also begin

implementing their control measures

before submission to EPA as part of

their SIPs, which would provide

additional time sources may need to.

comply:

c. Comments and Responses

Comment: Several commenters

opposed EPA's proposal to shorten to 2

years the statutory 3-year period for

development and submittal of 15-

percent VOC RFP plans. They claim this

proposal violates the guarantee of 3

years for plan development to the State

in section 182(b)(l)(A) and is contrary to

EPA's basic proposed principle that

[quoting from the proposal] "subpart 2

SIP submittals will be due as a general

matter by the same period of time after

designation and classification under the

8-hour standard as provided in subpart

2 for areas designated and classified at

the time of enactment of the 1990

CAA." The commenters contended that

subpart 2 gives EPA no authority to

shorten the statutory 3-year period. In

contrast, Congress in subpart 1

authorized EPA to set a schedule for

nonattainment SIP submissions.

Congress, therefore, knew'how to give

EPA discretion to shorten SIP

submission deadlines according to the

commenters; it did not do so in subpart

2.

Concerning the timing of submission

of the RFP plan, another commenter was

concerned that the States may not have

sufficient photochemical modeling and

ambient air analyses to indicate the best

mix of RFP SIP controls. Additionally,

in areas dominated by mobile source

emissions, it may not be feasible to .

implement control measures to achieve

the RFP target within the 2 years after

the proposed required RFP SIP

submission date as EPA has suggested.

The commenter suggested that EPA

develop policy options that allow areas

in such predicaments to maintain

approved SIPs if emissions reductions

are not available to meet RFP

requirements and/or if available

emission reduction techniques might be

counterproductive to other local and

regional air quality goals.

Another commenter stated revisions

-to State emission reduction measures

cannot be adopted easily in a 2-year

time period because they require

administrative action and frequently

State legislation to approve. This period

can.lengthen when proposed measures

like enhanced vehicle I/M involve

controversial actions affecting the

public. Logistically a State must

establish a regulation by administrative

action with public input before (though

sometimes after) such a measure is

approved by the state's legislature. A

number of jurisdictions' legislatures are

only in regular session to consider such

measureg several months or, in alternate

years. Thus, it is unreasonable for States

to have only 2 years from their

nonattainment designations to6 adopt

new -measures. Another commenter referenced the

case NRDC v. EPA, 22 F. 3d 1125, 1135

(D.C. Cir., 1994), where the Court

considered the propriety of EPA's

extension of the deadlines by which

States had to submit elements of their

SIPs. The Court upheld EPA's decision

to extend the deadline for submission of

a SIP given EPA's failure to meet its

own deadline for providing certain

necessary guidance to the States. The.

Court allowed EPA to use the

extraordinary remedy of a deadline

extension in this instance because

Cohgress would have intended that the

deadline be extended to provide a party

the full statutory time for acting on the

agency guidance: The commenter

referenced CAA section 126(c) where

EPA may set a compliance deadline "as

expeditiously as possible, but in no case

later than 3 years after the date of such

finding."

One commenter noted that CAA

section 182(b)(1)(A) as modified by

section 181(b)(1) requires for moderate

areas that the RFP SIP be submitted 3

years after designation. The commenter

disagreed with the RFP plan

requirement to submit the plan 2 years

after the effective date of the

nonattainment designation as not being

consistent with or supported by these

CAA sections. The resources involved

in developing, proposing and adopting

any SIP revision are not insignificant. In

order to ensure the most efficient use of

resources, the commenter contended

that EPA should not require this SIP

revision sooner than the submission of

the attainment demonstration, 3 years

after the effective date of the

designations. Allowing States 3 years to

submit the RFP plan is consistent with

existing CAA requirements. .

Response: After consideration of the

comments, we have changed the final

rule to be consistent with the approach

advocated by a number of commenters.

In consideration of the 2004 designation

and the need to achieve the 2008 RFP

reductions by December 2008, it seems

reasonable to EPA that States first be

given sufficient time after designation to

formulate RFP plans. Therefore, the

final rule allows States up to 3 years

after designation to submit their RFP

SIPs. However, to the extent States are

relying on newly developed rules to

meet all or part of the RFP requirement,

we recommend that States adopt those

rules as soon as possible after

designation to provide as much time as

possible for sources to achieve the

emissions reductions.

6. How should CAA restrictions on

creditable measures be interpreted?

Which national measures should count

as generating emissions reductions

credit toward RFP requirements?

[Section VI.I.7 of June 2, 2003

proposed rule (68 FR 32834);

§ 51.910(a)(4) of the draft regulatory

text; § 51.910(a)(3) of the final regulatory

text.]

a. Background

Section 182(b)(1) contains provisions

that limit creditability toward meeting

RFP for certain limited emission

reduction measures required prior to the

enactment of the CAA Amendments of

1990. We noted in the proposal that we

believe these specific restrictions should

continue to apply for purposes of the 8-

hour NAAQS. The proposal noted that

Congress intended to prevent areas from

taking credit for RFP only for those

specific measures that were already

adopted and in place (or required to be

in place) prior to the date of enactment

of the CAA Amendments of 1990.

(November 15, 1990). We said that this

same holds true for the RFP requirement

as it applies to the 8-hour ozone

standard, namely preventing credit

toward the mandatory RFP percent

reductions for continuing reductions

from those specific measures cited in

the CAA that were already adopted and

in place (or required to be adopted and

in place) prior to the date of enactment

of the CAA Amendments of 1990. There

is no indication in the CAA that this

exclusion should be changed. Congress

mandated many emissions reductions in

the 1990 CAA Amendments with no

indication that they should not be *

credited to meeting RFP or attainment of

any existing or revised NAAQS.

Therefore, we proposed that all

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emissions reductions that occur from all

Federal and any other measures not

otherwise identified in section

182(b)(1)(C) and (D) and that occur after

the baseline emissions inventory year

would be creditable for the RFP

requirement. A number of examples

demonstrating emissions reductions that

would be creditable toward theRFP

requirement were set forth in our

proposal.

b. Summary of Final Rule

We are taking the approach 'we

proposed, under which all emissions

reductions that occur after the baseline

emissions inventory year are creditable

for purposes of the RFP requirements in

this section except as specifically

provided in section 182(b)(1)(C) and (D)

and section 182(c)(2)(B) of the CAA. The

restriction imposed by section

182(b)(1)(D) limits crediting reductions

from the following four categories:

* Corrections to or additions of RACT

rules as required by CAA section

182(a)(2)(A)..

* Corrections to I/M programs for

areas where the SIP included or was

required to include' a schedule for I/M

implementation under the CAA in effect

immediately before November 15, 1990.

* Regulations concerning Reid Vapor

Pressure (RVP) promulgated by EPA

before November 15, 1990 or required to

be promulgated under CAA secti6n

211(h).

o Motor vehicle exhaust or

evaporative emissions'measures

promulgated by EPA by January 1, 1990.

c. Conunents and Responses

Comment: One commenter supported

EPA's proposal to allow credit towards

RFP requirements of all emissions

reductions, which occur after the

baseline emissions inventory year

(2002) from all Federal, and any other

measures not otherwise identified under

section 182(b)(1)(D). This would include

reductions from cleaner fuels and

engines, reductions from ongoing 1-hour

SIP controls and VOC reductions from

implementation of MACT standards

after the baseline year. The commenter

stafed that.this proposed approach

would be critical in a number of areas

that already have stringent stationary

source controls and/or in areas

'dominated by mobile source emissions.

Response: The EPA acknowledges this

comment of support for our final action.

Comment: Another commenter

believed that early voluntary emissions

reductions prior to 2003, and not

required under the CAA, should also be

creditable toward RFP requirements.

The commenter recommended that

EPA's final rule clarify that States be

allowed credit for RFP for early

voluntary emissions reductions

occurring prior to 2003. As a company

that has proactively taken measures to

reduce*NOx emissions through

innovative Combustion Initiative (an

enhanced efficiency technology), the

commenter believed that EPA's

regulations should take these efforts into

account .as they have resulted in real

improvements to air quality. Another

commenter stated that companies who

made voluntary reductions prior to 2003

would be penalized for having

undertaken such voluntary measures

and, thus disallowing credit for these

reductions provides disincentives for

voluntary reductions.

Response: Voluntary reductions that

occur prior to January 1, 2003 will be

reflected in the area's baseline

inventory. This lower baseline means

that fewer reductions will be needed to

achieve RFP. 43 Allowing an area to take

credit for reducing emissions that are

not included in the inventory would

result in "double counting" of those

emissions reductions.'

Comment: One commenter suggested

that areas should be able to take credit

for MACT standards that may reduce

VOC for which compliance is required

after the 2002 baseline year. The

.commenter said it would be helpful to

States if EPA produced a document

detailing the expected VOC reductions

after implementation of MACT

standards. States could claim these

reductions toward any reductions'

required to meet their target. The

commenter suggested that the most

useful way to express the reduction

would be as a percent of the 2002

emissions. "

Response: The EPA agrees that areas

can take credit in RFP plans for post2002 VOC reductions from MACT

standards. We are considering whether

to develop the recommended guidance.

Comment: One commenter objected to

EPA's proposal to allow States to claim

RFP credit from any reductions

achieved through post-1990 adoption of

the types of measures listed in section

182(b)(1)(D). The commenter further

stated that section 182(b)(1)(D) prohibits

granting RFP credit for any measures

contained on the list. Congress wanted

the RFP reductions to be new reductions

rather than emission cuts that would

43 For example, if an area had VOC emissions in

2001 of 100 tons per day, and a source reduces

emissions by 10 tons per day in 2002, the baseline

emissions will be 90 tons per day. Thus, the area

will need to achieve 13.5 tons per day reduction to

meet its 15 percent requirement, rather than 15 tons

per day. However, the area cannot take credit in the

15 percent plan for the 10 tons per, day of emissions

that are not part of the baseline inventory.

have occurred anyway. In the case of 8-

hour nonattainment areas, the baseline

year will be 2002. Therefore, according

to the commenter, to be consistent with

subpart 2, EPA must disallow RFP

credit for measures listed in section

182(b)(1)(D) adopted any time prior to

2002.

Another commenter urged EPA to

consider a hybrid approach that gives

States credit for approved RFP plans

that go beyond 2002, provided that the

Plan is evaluated on a 2002 baseline.

This approach Would give States credit

for ongoing emissions reductions,

recognize the need to address the 8-hour

standard as the ozone standard (rather

than rely on plans developedto meet

the 1-hour standard), and potentially

avoid some unneeded controls.

Another commenter recommended

that EPA not allow emissions reductions

credit for all emissions reductions

occurring after the baseline year.

Emissions reductions to satisfy the RFP

requirements of CAA section 182(b)(1)

and 182(c)(2)(B) are required to be

achieved by submitting "a revision to

the applicable implementation plan to

provide for * * * emissions

reductions." The commenter argued that

emissions reductions already required

by, or accounted for in, the applicable

implementation plan may not be

credited toward the new RFP

requirements. For example, reductions

that were required to be achieved by SIP

or other requirements, but which were

not achieved in practice prior to the

baseline year, should not be credited

toward meeting the new RFP reductions

required after the baseline year. Only

-new measures submitted with the new

SIP revision may be credited for this

purpose.

Response: The EPA believes that, with

certain exceptions (see CAA section

182(b)(1)(C) and (D)), any reductions

that occur after 2002 are creditable

towards RFP and attainment and that it

should not matter when the State

initially adopted or EPA promulgated

the measures that produce those

reductions. The CAA does not mandate

the approaches advocated in the

comments. While the comments cite

phrases in the CAA that might be read

to support the approach advocated in

the comments, EPA believes such an

interpretation is at odds with other

provisions of the CAA. In addition to

the restriction imposed by section

182(b)(1)(D) on crediting certain

measures, section 182(b)(1)(C) places

only two restrictions on creditability of

reductions towards RFP: first,

reductions are creditable if they result

from measures in the applicable

implementation plan, i.e., the approved

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SIP or from rules promulgated by EPA,

or from the applicable requirements 44

that are incorporated into a title V

permit; and secondly, only those

reductions that have actually occurred

after the baseline year and before the

milestone date may be credited towards

a RFP milestone. The requirement that

the reductions result from measures in

the applicable implementation plan or

EPA regulations, or applicable

requirements contained in a title V

operating permit imposes no restriction

that such measures must be enacted

after the date of designation or after the

baseline year. This restriction only

requires that the measure approved into

the SIP be a rule promulgated by EPA

or be an applicable requirement

included in a title V permit issued

before or concurrently with approval of

the RFP SIP revisions, and that the

reductions occur after the baseline year

and before the milestone date.

While this provision limits EPA's

discretion to allow credit towards the

RFP requirement from any reduction

that does not fit into any of the three

aforementioned classes of measures,

EPA does not see anything in the statute

that mandates the adoption of the

approach advocated in the comments. In

fact, EPA believes the opposite is the

case. The same argument (i.e., that

creditable RFP measures must be

measures adopted/promulgated after

designation or after the baseline year)

could have been mad6 for the various

programs mandated by the 1990 CAA

Amendments. These mandated

measures included RACT requirements

under section 182(b)(2), Stage II vapor

recovery under section 182(b)(3), motor

vehicle I/M under sections 182(b)(4) and

182(c)(3), RFG under section 211(k), and

the Tier 1 motor vehicle standards

under title II. The EPA believes the

statute is plain that Congress envisioned

that all 6f these would be adopted after

1990 and in most cases implemented

before 1996 because the statute contains

enforceable deadlines for submission of

the requisite SIP revisions or

promulgation of the EPA rules. In many

cases, they contain required

implementation dates before 1996.

Congress clearly did not limit credit for

RFP for any of these measures. In our

proposed rulemaking, EPA specifically

proposed allowing use of reductions

resulting from. any measure as long as

th6 reductions meet the creditability

criteria of section 182(b)(1)(C) for the

44 Applicable requirements are federallyenforceable requirements under the CAA that are

created elsewhere but incorporated into a title V

permit. See the definition of "Applicable

requirement" in 40 CFR 70.2 and 71.2.

very reason EPA concluded Congress

did not intend to impose the sort of

limit on creditability advocated-in the

comments for the 1-hour standard and

for any revised standard.

In summary, the statute says that only

four specific categories of emissions

reductions are restricted. It does not

refer to or include any post-1990 rules'

emissions reductions as restricted and

only speaks to creditability in terms of

when the reductions occurred, not when

the rules or measures were adopted. As

explained in the proposal and the

preceding paragraphs, Congress had

reason to limit creditability of pre-1990

rules, mandated many post-90 rules and

allowed these rules to be credited

towards post-90 RFP, and nothing in the

statute leads us to believe that Congress

would not havewanted them to also be

creditable to post-2002 RFP. The EPA

believes it is appropriate to allow credit

toward RFP for emissions reductions

other than reductions from the four

categories specified in the CAA

pursuant to section 182(b)(1)(D).

Language that was once pertinent to the

schedule of the 1990 CAA Amendments

should be reinterpreted now to mean

emissions reductions are creditable

toward emissions' reductions

requirements to the extent they actually

occur during the relevant ROP period

and after the baseline year.

7. For areas covered only by subpart 1,

'how should the RFP requirement be

structured?

[Section VI.I.8. of June 2, 2003

proposed rule (68 FR 32834); § 51.910(b)

of the draft and final regulatory text.]

a. Background

The proposal noted that the RFP

requirement under subpart 1 is more

general than that under subpart 2, and

EPA thus has more flexibility in

determining what RFP means under

subpart 1. For instance, the State may

rely on emissions reductions of VOC or

NOx, or a combination of both to meet

its RFP requirement whereas subpart 2

limits the initial 15 percent to VOC

emissions reductions. However, we

acknowledged the concern about

treating in a similar manner areas under

subpart 1 that have an ozone problem

similar to areas covered under subpart

2.

We proposed scenarios for three types

of subpart 1 areas: (a) Areas with

attainment dates 3 years or less after

designation, (b) Areas with attainment

dates between 3 to 6 years after

designation, and (c) Areas with

attainment dates beyond 6 years after

attainment.

* Areas with attainment dates 3 years

or less after designation.

We proposed these areas would be

treated similar to areas under subpart 2

that are classified as marginal, which do

not have an RFP requirement. We

proposed such an area Wvould not be,

subject to a separate RFP requirement,

but RFP would be met by demonstrating

the area could attain the standard by its

attainment date.

e Areas With attainment dates

between 3 to 6 years after designation.

These areas would have attainment

dates similar to subpart 2 areas

.classified as moderate. We proposed

two options for these areas:

* Option 1. This option would

require the RFP plan to be submitted

with the attainment demonstration

within 3 years after designatior of the

nonattainment area and RFP would be

met by-a SIP that provides for

attainment as expeditiously as

practicable. Where areas have only 3

years after SIP submission before

attainment, this option recognizes that

there may be only a short amount of.

time available to achieve any specified

emissions reductions to meet RFP. The

draft regulatory text incorporated this

option.

# Option 2. This option would

require these areas to be treated in a

manner similar to subpart 2 areas

classified as moderate. The RFP SIP

would have to provide for a 15 percent

emission reduction from the baseline

year within 6 years after the baseline

year. The RFP SIP would have to be

submitted within 2 years after

designation. However, since the area is

subject only to subpart 1, VOC or NO>(

emissions reductions could be relied on

to meet the 15. percent reduction

requirement, consistent with EPA's NOx

substitution policy. 45 Also, we solicited

comment on whether a percentage other

than 15 percent should. be required as

the minimum. Additional measures that

would provide the remaining portion of

the emissions reductions needed for

attainment would have to be submitted

with the area's attainment

demonstration within 3 years after

designation.

* Areas with attainment dates beyond

6 years after designation.

These areas would have attainment

dates similar to areas classified under

subpart 2 as serious or higher. We

proposed that the RFP plan show

increments of progress from the baseline

emissions inventory year out to the

attainment date. The RFP SIP would

45

NOx Substitution Guidance. December 15,

1993 (available at http://www.epo.gov/ttn/oarpgl

tIpgm.html).

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first have to provide for a 15 percent

emission reductiofi from the baseline

year within 6 years after the baseline

year. The 15 percent RFP SIP would

have to be submitted within 2 years

after designation. However, since the

area is subject only to subpart 1, NOx

emissions reductions could be

substituted for some or all of the 15

percent reduction requirement,

consistent with EPA's NOx substitution

policy. Also, we solicited comment on

whether a percentage other than 15

percent would be more appropriate. For

each subsequent 3-year period out to the

attainment date, another RFP SIP Would

have to provide for an additional

increment of progress no less than the

amount of emissions reductions that

would be proportional to the time

between the end of the first increment

to the attainment date. This second RFP

SIP would have to be submitted at the

same time as the attainment

demonstration, namely within 3 years

after designation.

b. Summary of Final Rule

We are finalizing rules for two, rather

than three, categories of areas based on

the CAA's division of attainment dates

for subpart 1 areas under section

172(a)(2). This provision requires that

subpart 1 areas must attain as

expeditiously as practicable but no later

than 5 years after designation as a

nonattainment area. It also allows the

Administrator to extend the attainment

date beyond that 5 year period "" * *

for a period no greater than 10 years

from the date of designation as

nonattainment, considering the severity

of nonattainment and the availability

and feasibility of pollution control

measures." The two scenarios for RFP

for subpart 1 areas are based on whether

the area does or does not receive an

extended attainment date. The following

are the two scenarios and the RFP

requirements for each:

Scenario A: Areas with attainment dates

5 years or less after designation (i.e., on

or before June 15, 2009 for areas

designated June 15, 2004).

As noted elsewhere in'this preamble,

for areas classified under subpart 1,

emissions reductions needed for

attainment must occur by the beginning

of the ozone season preceding the

attainment date. Thus, to enable a SIP

to demonstrate attainment by June 15,

2009, the area must achieve all

necessary reductions by the beginning

of the 2008 ozone season. The final rule

provides that RFP for these areas would

be met by ensuring emissions

reductions needed for attainment are

implemented as noted above by the

beginning of the ozone season prior to

the attainment date.

Scenario B: Areas with attainment dates

more than 5 years after designation (i.e.,

beyond June 15, 2009 for those areas

designated June 15, 2004). For these

areas:

* The RFP plan must show

increments of progress from the baseline

emissions inventory year out to the

attainment date.

* The RFP SIP would first have to

provide for a 15 perceht einission

reduction from the baseline year

through the 6th year after the baseline

year (e.g., from January 1, 2003 through

December 31, 2008).

* The 15 percent RFP SIP must be

submitted within 3 years after

designation (e.g., by June 15, 2007).

* However, since the area is subject

only to subpart 1, NOx or VOC

emissions reductions (or both) could be

used to achieve the 15 percent emission

reduction requirement.

* For each subsequent 3-year period

out to the attainment date, the RFP SIP

would have to provide for an additional

increment of progress. The increment

for each 3-year period would be a

portion of the remaining emission

reductions needed for attainment

beyond those reductions achieved for

the first increment of progress (e.g.,

beyond 2008 for areas designated

nonattainment in June 2004).

Specifically, the amount of reductions

needed for attaihment should be

divided by the number of years needed

for attainment after the first increment

of progress in order to establish an "annual increment." For each 3-year

period out to the attainment date, the

area must achieve roughly the portion of

reductions equivalent to three annual

increments. 46 This second RFP SIP must

46 For example, if the area's attainment date is

2014, and a total of 30 percent reduction is needed

between the end of 2008 and the attainment date

(a 6-year period) to reach attainment, the "annual

increment" would be 5 percent (i.e., 1/6 of 30

percent). Thus, the area must achieve roughly the

portion of reductions equivalent to 15 percent (3 x

5 percent) during the first 3 years (2009, 2010,

2011), and the remaining amount over the next 3

years (2012, 2013, 2014). By using the word

"roughly" in the regulatory text, EPA does not

intend that States would be able to delay substantial

emission reductions from one 3-year period to the

next. Rather, EPA intends this modifier to allow

small deviations from the amount of emission

reductions that would be needed to meet a 3-year

RFP requirement. For example, assume that the

"annual increment" of reductions needed for an

area to reach attainment (after the initial 6-year RFP

obligation) is 5 tons per day and that the area has

6 additional years until attainment. Thus, for each

of the two 3-year periods intil attainment, the area

would need "roughly" 15 tons per day, so long as

the total for both periods is equivalent to or greater

than 30 tons per day (i.e., the total reductions

needed for attainment). Assuming the area could

also be submitted within 3 years after

the effective date of designation (i.e., byJune 15, 2007).

While the adopted rule is not

identical to any of the proposed options,

we believe it is a logical outgrowth of

our three proposed scenarios. The - "

adopted approach is more stringent than

certain of the proposed options and less

stringent than others. Since this final

decision incorporates elements of the

three proposed scenarios, we believe it

is similar in result to the three scenarios

proposed.

c. Comments and Responses

Comment: One commenter stated that

EPA has no authority to adopt "Option

1" for areas with attainment dates

between 3 and 6 years after designation,

because that option would waive any

showing of RFP.

Response: The EPA acknowledges

that Congress prescribed specific RFP

requirements under subpart 2, but for

subpart I provided more flexibility.

Our rule does not eliminate RFP

obligations for subpart 1 areas. We are

not requiring any specific percent

reduction for sibpart 1 areas with nearterm attainment dates. The measures

that bring about near-term attainment

represent all the reductions that are

reasonable to require as annual

incremental progress towards

attainment. The EPA is not compelled to

require a 15 percent emission reduction

for all subpart 1 areas, especially in

those cases where a full 15 percent is

not needed in order to reach attainment.

However, we believe that it is generally

appropriate to require the full 15

percent for areas with long-term

attainment dates to ensure interim

progress towards attainment.

Comment: Some commenters

supported the proposal that ties the

required RFP showing to the attainment

date. Specifically, these commenters

supported the proposal that areas with

attainment dates of 3 years or less

should have no separate RFP

requirement, consistent with the

requirement applicable to marginal

areas under subpart 2. In addition,

support was shown for Option 1 for

subpart 1 areas with an attainment date

between 3 and 6 years following

designations. Under Option 1, areas

achieve 14 tons per day during the first 3-year

period, and achieve the remaining 16 tons per. day

during the second 3-year period, we believe this

would be consistent with achieving "roughly the

portion of reductions equivalent to three annual

increments." We do not believe, however, that use

of the word roughly allows States to delay

substantial emission reductions. Thus, in the

example above, it would not be appropriate for the

State to delay reductions of several tons per day

until the second 3-year period.

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would have to show an adequate rate of

reduction in order to achieve attainment

by the deadline, but there would be no

specific percentage reduction required.

I Response: We acknowledge the

support of these comments.

Comment: Another commenter

believed that a 15 percent emissions

reductions requirement should only be

required where such reductions would

meaningfully advance the date of

attainment. The RFP requirement in

subpart 1 requires that the SIP provide

for "reasonable further progress," and.

where emissions reductions would not

create "reasonable further progress"

either in the area itself or in downwind

areas, there is no basis under subpart 1,

to require such specific emissions

reductions. They further said that

requiring a potentially expensive

reduction in emissions in those cases

where that reduction would not

improve air quality was not justified

based on a notion of "equity" with

similar areas classified under subpart 2

and noted that such an interpretation

was not required by the statute or

sensible. That some subpart 2 areas

might have to reduce emissions by a

specified percentage even where such

reductions would yield no positive

environmental benefits is an

unfortunate result of the Congress'

decision to limit EPA's discretion under

subpart 2-which in turn is a result of

a far less sophisticated understanding of

the dynamics of ozone creation in 1990

than exists now-and where EPA has

the discretion not to dictate an

ineffective and inefficient result, it must

exercise that discretion.

Response: We addressed in general

those comments that recommended

alternatives to the mandatory measures

of subpart 2 (which includes the RFP

requirement) in the response to

comments above under the topic,

"Should prescribed requirements of

subpart 2 apply'in all 8-hour

nonattainment areas classified under

subpart 2, or is there flexibility in

application in certain narrowly-defined

circumstances?" We conclude in that

section that EPA has no discretion to

broadly waive mandatory requirements.

However, we noted that case law may

provide support for case-by-case

waivers where implementation of a

measure would produce an absurd

result.

8. Where Part of an 8-hour

Nonattainment Area Was a 1-hour

Nonattainment Area With a ROP

Obligation Extending Past 2002, Can

Emissions Reductions From the Area's

1-hour ROP Plan Be Used as Credit

Toward Meeting the Area's 8-hour RFP

Plan?

[Section VI.I.9. of June 2, 2003

proposed rule (68 FR 32835); no draft or

final regulatory text.]

a. Background

We, proposed the following approach

to address this issue. Where an area has

both 1-hour and 8-hour RFP obligations

for the post-2002 period, the State may

rely on emissions reductions from the 1-

hour plan in achieving RFP for the 8-

hour standard. The State could develop

a new baseline and new RFP emission

reduction targets for the entire 8-hour

standard nonattainment area (i.e., the

old 1-hour standard nonattainment area

and any newly added portion of the 8-

hour standard nonattainment area).

Emissions reductions from measures in

the 1-hour ozone SIP that are achieved

after the 8-hour ozone NAAQS baseline

year could count (subject to creditability

restrictions as discussed above) toward

ineeting the RFP requirement for the

entire 8-hour area. This approach would set a RFP target

for the entire 8-hour ozone

nonattainment area. Under this

approach, the new RFP target for the 8-

hour standard would replace the

previous 1-hour ROP target (while

ensuring that, at a minimum, the

emissions reductions required to meet

the old target are met; see 40 CFR

51.905(a)(1)(iii)).

b. Summary of Final Rule

We are adopting the approach from

the proposal.

c. Comments and Responses

Comment: One commenter agreed

with the approach outlined in the

proposal but cautioned that the States

would have to ensure that the target is

at least as stringent as the 1-hour ROP

target, thus ensuring no backsliding on

the 1-hour NAAQS requirements. Under

this approach, the State would have to

develop a new baseline and new RFP

emission reduction targets for the entire

8-hour standard nonattainment area.

Emissions reductions from measures in

the 1-hour ozone SIP that are achieved

after the 8-hour ozone NAAQS baseline

year could count (subject to credibility

restrictions as discussed in the proposed

rulemaking) toward meeting the RFP

requirement for the entire 8-hour area.

The new RFP target for the 8-hour

standard would replace the previous 1-

hour ozone target (while ensuring that,

at a minimum, the emissions reductions

required to meet the old target are met).

Response: We agree with the

commenter that the emission reducti6n

targets under the 8-hour standard must

be at least as stringent as the 1-hour

targets. Section IV.E.3. of this preamble

discusses the requirements for RFP for

several situations relative to the area's

former obligations under the 1-hour

standard and the current obligations

under the 8-hour standard. The

obligations of an area under the antibacksliding provisions of 40 CFR

51.905(a)(1)(iii) would still apply,

meaning that emissions reductions

under the 1-hour ROP requirements

would still be required as if the 1-hour

standard had never been revoked.

Therefore, the new 8-hour emission

target for the 8-hour area would be "

logically at least as stringent as under

the 1-hour area for a given time period.

9. Will EPA's "Clean Data Policy"

Apply for Purposes of 8-hour RFP,

Attainment Demonstrations and Other

Related Requirements?

[Section VI.I.10 of June 2, 2003

proposed rule (68 FR 32835); no draft

regulatory text; section 51.918 of final

rule.]

a. Background

As noted in the proposal,.we issued

a policy.on May 10, 1995, which allows

EPA to determine that an area has

attained the standard and that certain

planning requirements (e.g., RFP and

attainment demonstrations) will not

apply so long as the area remains in

attainment. 47 This is referred to as the

"Clean Data Policy." We proposed that

this policy would remain effective for

purposes of areas that EPA determines

have attained the 8-hour ozone NAAQS.

b. Summary of Final Rule

In the proposed rule, we indicated

that the Clean Data Policy, which we

had applied under the 1-hour standard,

should apply for purposes of the 8-hour

standard. We are adopting this

approach. In this action EPA is

finalizing-the statutory interpretation

that is embodied in the policy. The text

of the final rule encapsulates the

statutory interpretation set forth in the

policy: Determinations as to whether

individual areas have attained the 8-

4

7 Memorandum of May 10, 1995, "RFP,

Attainment Demonstration, and Related

Requirements for Ozone Nonattainment Areas

Meeting the Ozone National Ambient Air Quality

Standard," from John S. Seitz, Director, Office of

Air Quality Planning and Standards Available at:

http://www.epa.gov/ttn/oarpg/tl/memoranda/

clean15.pdf.

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hour standard and thus qualify for

application of the policy will be made

in the context of rulemakings for those

individual areas. The EPA has applied the Clean Data

Policy in rulemakings under the 1-hour

ozone standard to both subpart 1 areas,

e.g., San Francisco Bay Area (69 FR

21717; April 22, 2004) and subpart 2

areas, e.g., St. Louis, Missouri (68 FR

25418; May 12, 2003). The'EPA will also

apply the policy to both subpart 1 and

subpart 2 areas under the 8-hour

standard.

c. Comments and Responses

Comment: One commenter stated that

EPA's "Clean Data Policy" is unlawful

with respect t6 both the 1-hour and 8-

hour NAAQS. A commenter argued that

EPA also has no authority to waive the

attainment demonstration and RFP

plans mandated by subpart 2 on the

pretext that an area has clean data. The

CAA unambiguously requires these

plans for any area designated

nonattainment for the pollutant ozone,

and gives EPA no power whatsoevei to

waive such plan requirements.

Several other commenters supported

the continued use of the "Clean Data

Policy."

Response: The EPA believes that the

Clean Data Policy comports with the

provisions of the CAA in regard to

attainment demonstrations, ROP plans,

RACM, contingency measures and other

related requirements. The Clean Data

Policy, issued on May 10, 1995, sets

forth EPA's interpretation that where

EPA has determined that an area has

attained the standard, cQrtain SIP

requirements are suspended (e.g., RFP)

for so -long as the area remains in

attainment.

As set forth in its May 10, 1995

policy, EPA believes it is reasonable to

interpret the provisions regarding RFP

and attainment demonstrations, along

with certain other related provisions, as

not requiring further submissions to

achieve attainment for so long as the

area is in fact attaining the standard.

Under the policy, EPA is not granting an

exemption from any applicable

requirements under part D. Rather, EPA

has interpreted these requirements of

subparts 1 and 2 as not applying for so

long as the area remains in attainment

with the standard. This is not a waiver

of requirements that by their terms

apply; it is a determination that certain

requirements are written so as to be

operative only if the area is not attaining

the standard.

The EPA has explained in other

rulemaking actions on the 1-hour ozone

standard its rationale for the

reasonableness of this interpretation of

the CAA and incorporates these

explanations by reference. See, for

example, 67 FR 49600 (July 31, 2002);

65 FR 37879 (June 19, 2000) (CincinnatiHamilton, Ohio-Kentucky); 61 FR 20458

(May 7, 1996) (Cleveland-Akron-Lorain,

Ohio); 66 FR 53094 (October 19, 2001)

(Pittsburgh-Beaver Valley,

Pennsylvania); 60 FR 37366 (July 20,

1995); 61 FR 31832-33 (June 21, 1996)

(Grand Rapids, MI); 60 FR 36723 (July

18, 1995) (Salt Lake and Davis Counties,

Utah); 68 FR 25418 (May 12, 2003) (St.

Louis, Missouri); 69 FR 21717 (April 22,

2004) (San Francisco Bay Area). The

EPA has also set forth its legal rationale

for the Clean Data Policy in briefs filed

in the 10th, 7th, and 9th Circuits, and

hereby incorporates those briefs insofar

as relevant here. See Sierra Club v. EPA,

No. 95-9541 (10th Cir.), Sierra Club v.

EPA, No. 03-2839, 03-3329 (7th Cir.),

Our Children's Earth Foundation v.

EPA, No. 04-73032 (9th Circuit).

As stated in the policy, the attainment

demonstration, RFP requirements and

contingency measure requirement are

designed to bring an area into

attainment. Once this goal has been

achieved, it is appropriate to suspend

the obligation that States submit plans

to meet these goals, so long as the area

continues to attain the relevant

standard.

The Tenth, Seventh and Ninth

Circuits have upheld EPA rulemakings

applying the Clean Data Policy. See

Sierra Club v. EPA, 99 F. 3d 1551 (10th

Circuit, 1996), Sierra Club v. EPA, 375

F. 3d 537 (7th Circuit, 2004) and Our

* Children's Earth Foundation v. EPA, No.

04-73032 (9th Circuit, June 28, 2005)

memorandum opinion.

Comment: A commenter said that

although subpart 2 contains some

narrowly crafted exceptions [e.g., CAA

182(b)(1)(A)(ii)], there are no exceptions

based on clean data. In the past, EPA

has cited a Tenth Circuit decision,

Sierra Club v. EPA, 99 F. 3d 1551 (10th

Circuit, 1996), as supporting the Clean

Data Policy. The commenter contended

that case was wrongly decided and has

been superseded by the Supreme Court

decision in Whitman v. American

Trucking Assoc., Inc., 531 U.S. 457

(2001). There, the Court held that

subpart 2 eliminates regulatory

discretion previously allowed to EPA

under subpart 1, and noted that subpart

2 prescribes large parts of

nonattainment programs, for example,

section 182. The requirements for RFP

and attainment demonstrations are

among those subpart 2 nonattainment

programs that Congress prescribed by

law, thqreby eliminating EPA discretion

to accept something less. See also Sierra

Club v. EPA, 293 F. 3d 155 (D.C. Circuit,

2002) (holding that EPA is without

authority to. infer exceptions to

attainment deadlines and to explicit

subpart 2 requirements for RFP plans).

Response: The EPA believes that the

Tenth Circuit correctly decided Sierra

Club v. EPA and that the comments

misconstrue both Whitman and Sierra

Club v. EPA, 293 F. 3d 155 (D.C. Circuit,

2002) (Sierra Club2002). The Sierra

Club 2002 case addressed the statutory

requirements applicable to an area not

attaining the standard. The issue of the

requirements of part D of title I of the

CAA that must continue to be met by

areas that EPA has determined are

monitoring attainment of the standard

was not before the court. As discussed

below, the Sierra Club 2002 decision

upheld EPA's determination that the

RACM provision under section 172(c)(1)

requires only additional measures that

could contribute to RFP or attainment,

which is an element of EPA's

application of the Clean Data Policy. To

this limited extent, Sierra Club 2002 is

relevant to EPA's interpretation that the

policy will apply for the 8-hour ozone

standard, and the decision supports

EPA's interpretation. However, the other

issues addressed in the decision

(extension of the statutory attainment

date for areas affected by ozone

transport, the content of a

demonstration of RFP toward

attainment, and whether contingency

measures must be submitted as part of

an attainment demonstration or plan for

RFP) did not relate to the Clean Data

Policy or how the subpart 2

requirements apply to areas attaining

the standard..

The issue -addressed by the Clean Data

Policy is whether aii area that has

attained the standard (as evinced by air

quality monitoring data) still needs to

submit a demonstration of how the area

will achieve enough reductions to

demonstrate that it will "attain the

NAAQS," a plan to obtain reasonable

periodic reductions towards the goal of

attainment and other related

requirements.

The EPA continues to believe that the

statutory requirement for an attainment

demonstration-a SIP revision which

identifies the level of future reductions

needed to achieve the NAAQS and any

additional .adopted measures needed to

achieve these future reductions-is

written so as to be inapplicable once the

NAAQS is attained.

In addition, EPA believes that the

RACM requirements are a "component"

of an area's attainment demonstration

under section 172(c)(1). General

Preamble 57 FR 13560; April 16, 1992.

Thus, since for the same reason the

attainment demonstration no longer

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71646 Federal. Register/ Vol. 70, No 228/Tuesday, November 29, 2005/Rules and Regulations

applies by its own terms, RACM also no

longer applies. The EPA has

consistently interpreted this provision

to require only implementation of

potential RACM measures that couldcontribute to reasonable further progress

or to attainment. General Preamble 57

FR 13498; April 16, 1992.'Thus, where

an area is already attaining the standard,

no additional RACM measures are

required.48

Likewise, EPA concludes that the

provision for RFP-a plan for annual -

incremental reductions leading to

attainment-is also expressed in terms

that show that RFP is unnecessary in

areas attaining the standard. For areas in

attainment, there is no longer a need to

plan for measures to meet that goal.

Similarly, EPA continues to believe that

the contingency measure requirements

of section 172(c)(9) no longer apply in

an area that is attaining the standard

since those "contingency measures are

directed at ensuring RFP and attainment

by the applicable date." (See 57 FR

13564; April 16, 1992). The section

182(c)(9) contingency measure

requirement also no longer applies once

an area has attained the standard.

Section 172(c)(2) of the CAA and the

related provisions of subpart 2 provide

that RFP is required 'only where an area

continues to violate the standard. By

definition, the "reasonable further

progress" provision requires only such

reductions in emissions as are necessary

to attain the NAAQS by the attainment

date. If an area has attained the

standard, the stated purpose of the RFP

provision has been fulfilled. Also,

section 172(c)(1) and the related

provisions of subpart 2 require SIPS to

provide for attainment of the NAAQS.

(See also section 182(b)(1)(A)(i) which

requires that SIPS for-moderate ozone

nonattainment areas must "provide for

such specific annual reductions in

emissions of [VOCs] and [NOxI as

necessary to attain the [ozone NAAQS]"

by the applicable attainment date).

When an area has attained the NAAQS,

there is no need for a plan

demonstrating how it will reach

attainment, and thus the attainment

demonstration provision no longer

applies. Similarly section 172(c)(9) and

the related provisions of subpart 2

provide that SIPs in nonattainment

48[The EPA's interpretation that the statute

requires only implementation of RACM measures

that would advance attainment was upheld by the

United States Court of Appeals for the Fifth Circuit

(Sierra Club v. EPA, 314 F. 3d 735, 743-745, 5th

Cir. 2002) and'by the United States Court of

Appeals for the D.C. Circuit (Sierra Club v. EPA,

294 F. 3d 155, 162-163, D.C. Cir. 2002). See also

the final rulemakings for Pittsburgh-Beaver Valley.

Pennsylvania, 66 FR 53096 (October 19, 2001) and

St. Louis, 68 FR 25418 (May 12, 2003).]

-areas shall provide for contingency

measures to be findertaken if the area

fails to make RFP or to attain the

NAAQS by the applicable attainment

date. Since contingency measures are

required only if RFP or attainment is not

achieved, there is no need for them

where the area has attained the

standard. The language-of these

statutory provisions indicates that when

an area has attained the standard these

requirements no longer apply as the

purpose of these provisionsattainment-has been accomplished.

The EPA believes that Whitman does

not provide a basis to reconsider our

position on the Clean Data Policy. In

Whitman, the Court was addressing

EPA's stated approach that subpart 2

did not apply for purposes of

implementing the 8-hour NAAQS. In

the Phase 1 rule, EPA addressed the

Court's decision and concluded that

subpart 2 does apply. The issue here is

not whether it applies, but how those

requirements apply under a specific

situation where an area has attained the

NAAQS. That issue was not addressed

by the Court in Whitman. The decision

in Whitman has no bearing on the

question of whether an area that has

demonstrated attainment must

nonetheless submit an attainment

demonstration plan and related

requirements. Thus, Whitman does not

underline the Tenth Circuit's reasoning

in Sierra Club v. EPA, 99 F. 3d 1551

(10th Circuit, 1996). See, also the postWhitman decisions in Sierra Club v.

EPA, 375 F. 3d 537 (7th Circuit, 2004),

and Our Children's.Earth Foundation v.

EPA, No. 04-73032, memorandum

opinion (9th Circuit, June 28, 2005)

rejecting challenges to the Clean Data

Policy and upholding redesignation

actions based on the policy.

10. How will RFP be addressed in Tribal

areas?

. [Section VI.I.11. of June 2, 2003

proposed rule (68 FR 32835); no draft or

final regulatory text.]

a. Background .

The TAR provides flexibility for

Tribes in the preparation of a TIP to

address the NAAQS. As mentioned in

the proposed rulemaking, the TAR

provides the Tribes with the ability to

develop TIPs to address and implement

the NAAQS in Indian coultry. It further

provides the Tribes with flexibility to

develop these plans in a modular way,

as long as the elements of their TIPs are

reasonably "severable." For example,

each TIP submission must include a

demonstration that the Tribe has.

authority to develop and run its

program, the ability to enforce its rules,

and the capacity and resources to

implement the program it adopts.

Therefore, it may include one or two

source-specific requirements but may

not include provisions for RFP and

other SIP requirements. The proposal

noted that these TIPs can be an

important step in addressing an overall

air quality plan to achieve health and

environmental goals on Tribal lands.

Where a Tribe chooses not to address a

specific planning element, EPA may be

obligated to step in. Such action would

not preclude a Tribe from addressing

those elements at a later time.

b. Summary of Policy

We intend to take the approach noted

in the proposal. There- is no regulatory

text for this intention.

c. Comments and.Responses

No comments were received on this

portion of the proposal.

11. How will RFP targets be calculated?

[Section VI.1.12. of June 2, 2003

proposed rule (68 FR 32836); § 51.910(c)

of the draft and final regulatory text.]

a. Background

We proposed a methodology for the

calculation of RFP target levels of

emissions that is based on the method

we developed for the 1-hour standard,

while taking into account our'

interpretation of CAA restrictions on

creditable emissions and our proposal to

use the 2002 inventory as the baseline

inventory for the RFP requirement. The

CAA specifies four types of measures

that were not creditable toward the 15

percent RFP requirement. These are:

(1) Any measure relating to motor

vehicle exhaust or evaporative

emissions promulgated by the

Administrator by January 1, 1990.

(2) Regulations concerning Reid

Vapor Pressure (RVP) promulgated after

1990 or required under section 211(h).

(3) Measures required under section

182(a)(2)(A) to correct deficiencies in

SIPs regarding VOC RACT regulations

required prior to enactment of the CAA

Amendments of 1990.

(4) State regulations submitted to

correct deficiencies in I/M existing or

required programs.

These four types of measures were all

expected to result in a decrease in

emissions between 1990 and 1996. Of

these four types of measures, RACT and

I/M program corrections and the 1992

RVP requirements were completely in

place by 1996 and therefore are already

accounted for in the 2002 baseline. As

a result, they would produce no

additional reductions between 2002 and

2008 or later milestone years.

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