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Citation: 70 Fed. Reg. 71612 2005

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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 RuleTo Implement Certain Aspectsof 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 Rulefor Reformulated Gasoline
AGENCY: Environmental Protection Agency (EPA). ACTION: Final rule.

SUMMARY: In this document, we are taking final action on most remaining elements ofthe 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 asthey 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 ofthe rule is to provide certainty to States and Tribes regarding development of thoseplans.

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 oftitle I ofthe 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 bybeing reclassified as severe areas under section 181(b) ofthe CAA, will continue tobe required touse RFG at least untilthey 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 forthe 1-hour NAAQS under section 181(b) ofthe 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 inthe EDOCKET index athttp://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 willbe publicly available only in hard copy form. Publicly available docket materials are available either electronically inEDOCKET or inhard 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 forthe Public Reading Room is (202) 566-1744, and the telephone numberfor the Office ofAir and Radiation Docket and Information Center is (202) 566- 1742.

In addition, we have placed a variety ofearlier materials regarding implementation ofthe 8-hour ozone .NAAQS onthe Web site: http:// www.epoa.gov/ttnlnaaqs/ozone/ o3impfhr.

FOR FURTHER INFORMATION CONTACT: For general information: Mr. John Silvasi, Office ofAir 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 ofAir 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 ofAirQuality 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 orby e-mail at mcdonald.janet@epa.gov.
SUPPLEMENTARY INFORMATION: 

### Outline

I. What is the Background for thisRule?
II.

What is Included inthis Rule?
III. In Short, What Does thisFinal Rule

Contain? IV. Final Rule for Phase 2 Elements Other than NSR and RFG A. Should prescribed requirements of

subpart 2apply in all 8-hour nonattainment'areas classified under subpart 2, or is there flexibility in application in certain narrowly-defined " circumstances? B. How will we address long-range

transport ofground-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 willEPA 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 offailure 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 willbe 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 beprovided 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 underthe 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 ofFinal 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. OtherConsiderations

A. How will EPA's implementation ofthe

8-hour ozone NAAQS affect funding under the Congestion Mitigation and Air Quality Improvement (CMAQO Program? B. Whatis the relationship between

implementation ofthe 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 andExecutive 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, orUse 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 andLater ROP Milestone Years Appendix B to Preamble--Glossary Of

Terms and Acronyms

I. What Is theBackground for This Rule?

On June 2, 2003 (68 FR 32805), we published aproposed rule to implement the 8-hour ozone NAAQS. The proposal addressed anumber ofimplementation 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 (68FR 46536), we published a notice ofavailability ofthe draft regulatory text forthe'proposed rule to implement the 8-hour ozone NAAQS. This notice started a 30-day public comment period on the draft regulatory text. OnApril 30, 2004 (69 FR 23951), we published a final rule that addressed the following key elements related to implementation ofthe 8-hour ozone NAAQS: classifications forthe 8-hour NAAQS; revocation ofthe 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 ofemissions reductions needed for attainment.

Following publication ofthe April 30, 2004 finalrule, theAdministrator received three petitions, pursuant to section 307(b)(7)(B) ofthe CAA requesting reconsideration ofanumber ofaspects ofthe 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 ruleto take comment on two ofthese issues: (1) The provision that section 185 fees would no longerbe applicable once the 1-hour NAAQS is revoked and (2) the timing for determination ofwhat is an "applicable requirement." On May 20, 2005, the final rule onthese two issues was signed by the Administrator ofEPA. On April 4, 2005 (70 FR 17018), we published a proposed rule to take
comment on the issue ofwhether 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. Wetook final action on the NSR issues onJune 30, 2005 (70 FR 39413;fuly 8, 2005).

On January 10, 2005, we granted reconsideration ofthe overwhelming transport classification issue raised by Earthjustice in theirPetition. At the

same time, we denied reconsideration of the issues they raised intheir Petition dealing with the applicability ofRFG when the 1-hour NAAQS is revoked and future 8-hour ozoneredesignations to nonattainment. We intend to publish a proposed rule onthe overwhelming

'Three petitions for reconsideration ofthe Phase 1Rule were filed by: (1)Earthjustice onbehalfof the American Lung Association, Environmental Defense, Natural Resources Defense Council, Sierra Club, Clean Air Task Force, Conservation Law Foundation, and Southern Alliance forClean 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 ofCommerce. transport classification shortly. We are continuing to review the issues raised in the National Petrochemical and Refiners Association and American Petroleum Institute Petitions. Copies ofthe Petitions for Reconsideration and actions EPA has taken regarding the Petitions may be found at: www.epa.gov/ttn/naaqs/ozone/ o3imp8hr.

In addition, inthe April 30, 2004 rule,

-we established a subpart Ein 40 CFR part 81 "Identification ofArea Designations and Classifications forthe 1-Hour Ozone NAAQS as ofJune 15, 2004 [Reserved]." We intend to publish that list shortly.

Concerning the major NSR provisions, today's final regulations were proposed

as part oftwo different regulatory packages. OnJuly 23, "1996(61 FR 38250), we proposed changes to the major NSR program, including codification ofthe requirements ofpart D oftitle I ofthe 1990 CAA Amendments formajor stationary

sources ofvolatile organic compounds (VOC), NOx, particulate matter having a nominal aerodynamic diameter less than orequal to 10 microns (PMto), and CO. OnJune 2, 2003 (68FR 32802), we proposed arule to implement the 8-hour

ozone NAAQS. In the 2003 action, we proposed arule 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 notpropose specific regulatory language for implementation ofNSR 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 (68FR 32844). On April 30, 2004 (69FR 23951), we published a final rule that addressed classifications forthe 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 ofsubpart 1 and subpart 2.

Also, in our 1996 action, and then againin our June 2, 2003 action, we proposed to amend ournonattainment 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), awaiver from nonattainment NSR for NOx as an ozone precursor would be available forboth subpart 1 and subpart 2 areas (68 FR 32846). Moreover, we proposed to require Statesto modify their existing
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precursor in attainment areas (68 FR 32846).

In 1996, we proposed to revise the regulations limiting offsets from emissionsreductions due to shutting down an existing source orcurtailing 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 ofemission reduction credits from source shitdowns and curtailments as offsets.

OnJuly 2.3, 1996, we proposed to revise § 52.24 to incorporate changes made by the 1990 CAAAmendments 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. Inthat action, we also proposed that wewould revise § 52.24(k) to reflect the changes inthe 1990 CAAAmendments (68 FR 32846). On June 2, 2003 (68FR*32802), we explained implementation ofthe major NSR program underthe 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 3years after designation.

Inthis rule, we are also finalizing several revisions to the regulations governing the nonattainment NSR programs mandated by section' 110(a)(2)(C) and partD oftitle I ofthe Clean Air Act (CAA). First, we are codifying requirements added to part D oftitle I ofthe 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 forpermitting ofmajor stationary

sources in nonattainment areas in interim periods between designation of

new nonattainment areas and EPA's approval ofarevised SIP. Fourth, we are changing the regulations that impose a moratorium (bari) prohibiting construction ofnew or modified major stationary sources innonattainment

areas where the State fails to have an implementation plan meeting all ofthe requirements ofpart 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 oftitle I ofthe 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

onJune 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 ofSignificant 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 oftitle I, including major stationary sources of ozone precursors in ozone nonattainment areas.

For the reader's convenience, a glossary and list ofacronyms appears in Appendix B ofthispreamble.

II. WhatIs Included in This Rule?

Today's action, Phase 2 ofthe 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 ofthe RFG program.
III. InShort,What Does ThisFinal Rule Contain?

This summary is intended to give only a convenient overview of ourfinal rule. It should not be relied on for the details ofthe actual rule. The,final rule (regulatory text) and the discussion ofit in the sections bel6w should be consulted directly. Summary of Section IV (Below): Final Rule forPhase 2 Elements OtherThan NSR and RFG

A. Shouldprescribedrequirementsof subpart2 applyin all8-hour nonattainmentareasclassifiedunder subpart2,oristhere flexibilityin applicationin certainntirrowlydefined circumstancesZ

There may be a bastsfor waiving a prescribed requirement on a case-bycase basis where imposition ofthe requirement would create an absurd result. Ifa State submits a demonstration that application ofa specific requirement in a specific nonattainment area would create an absurd result, we will,consider application'ofthe absurd results doctrine at that time.We believe that absurd results that might occurfrom application ofmandatory control measures would happen only iii rare instances, ifat all.

B.Howwill we addresslong-range transportof ground-levelozone andits.
precursorswhen implementingthe 8- hourozonestandard?

The EPA has issued two major rules
to address interstate transport ofozone pollution. The 1998 NOx SIP Call Rule already is achieving significant reductions inNOx emissions that contribute to interstate ozone pollutionin the eastern United States. Nineteen Stateswere required to achieve reductions by May 2004, and additional reductions are required by May 2007.

On May 1,2, 2005, EPA published the Clean AirInterstate Rule (CAIR) inthe FederalRegister (70 FR 25162). It establishes statewide sulfur dioxide (SO 2) and NOx emissions budgets for upwind States that significantly. contribute to nonattainment orinterfere withmaintenance ofthe fine particle or 8-hour ozone air quality standards in downwind States. For ozone, this action established summertime NOxbudgets forthe District ofColumbia and 25 States inthe eastern halfofthe country, withreductions to be achieved by 2009. and 2015. The CAIR goesbeyond the SIP callby requiring reductions from additional States and by requiring further emissions reductions in SIP call States.

C.Howwill we addresstrdnsportof ground-levelozone anditsprecursors forruralnonattainmentareas,areas affected by intrastate transport, and

areasaffected by international transport?
1. Rural Transport Nonattainment Areas

The final rule does not contain any revisions to current policy onrural transport areas under section 182(h). We do notbelieve there are any 8-hour nonattaimnent areas covered under subpart 2that are "rural" and therefore eligible for consideration forcoverage under section 182(h).
2. Intrastate Transport

The final rule does notcontain any additional provisions for addressing intrastate transport for the reasons stated inthe 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 inthis rule. Section 179B of -theCAA applies for these purposes. We continue to recommend that States confer with the appropriate EPA

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Regional Officeto establish on a caseby-case basis the technical requirements for these analyses. These analyses will be subject to public comment during the State and Federal SIP processes.
D.How willEPA addressrequirements formodelingandattainment demonstration SIPs forareas implementingthe 8-hourozone standard?

The final rule retains the following three elements that each attainment demonstration SIP must include: (1) Technical analyses to locate and " identify sources ofemissions that are causing violations of the 8-hour NAAQS within nonattainment areas (i.e., .analyses related to the emissions inventory required forthe 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) ofthe 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 ofdesignation forthe 8-hour ozone NAAQS.

2. Multi-State Nonattainment Areas

State partners involved in a multiState ozone nonattainment areamust 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 beresponsible forits portion ofthe control program and will be held accountable for controls identified for implementation within its State boundaries.

3. Role ofModeling Guidance in Attainment Demonstrations

.Attainment demonstrations mustbe consistent with 40 CFR 51.112. We will generally review the demonstrations for technical merit using EPA's mostrecent modeling guidance at the time the modeled attainment demonstration is performed.

4. Multi-pollutant Assessments (OneAtmosphere Modeling)

There is noregulatory text on this issue, but the preamble makes several recommendations concerning multipollutant assessments. E. Whatrequirements forRFPshould. applyunderthe 8-hourozonestandard?

1. General Discussion

.We are adopting nearly allthe approaches set forth in our proposed rule forthe various 1-hour rate-ofprogress (ROP) and 8-hour RFP issues.

2. What is the content and timing ofthe 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 metthe statutory 15 percent requirement. Reasonable further progress for the first 6 years from thebaseline year would be covered under the more generic RFP requirements ofsubpart 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 outtothe attainment year.

An 8-hour nonattainment areathat is identical, geographically, to its predecessor 1-hour nonattainment area (whichhas already done the 15 percent reduction) will notbe required to do another 15 percent VOC-only reduction plan.For an 8-hour moderate orhigher nonattainment area that contains a 1- hournonattainment areathat has an approved 15percent VOCROP.planbut 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 anew 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 mustbe ofVOC only. Option2.Treat the 8-hour nonattainment area as divided between the old 1-hour area(s) and the newly added 8-hour area. Forthe newly added portion (whichhad notpreviously implemented a 15percent 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 1provisions ofthe CAA and willbe able to creditboth VOC and NOx toward meeting the RFP target for this portion ofthe nonattainment area. VOC reductions to meet the 15 percent requirement forthe portion ofthe new 8-hour nonattainment area that has notyet met this requirement may come from across the entire 8-hour area. The subpart 1 RFP provisions addressed by the rule belowthat are applicable inthe former 1-hour portion ofthe 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, forwhich portions ofthe areahave 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 willbe satisfied withthe measures that demonstrate attainment as expeditiously

as practicable. These areas willnotbe developing RFP plans separate from their attainment plans. Thus, forthese
areas, the only motor vehicle emissions budgets that willbe developed willbe forthe attainment year.

e Inmoderate areas that have an attainment date beyond 5years after their 8-hour designation, for which portions ofthe 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 willbe satisfied with a plan to demonstrate 15 percent emissions reductions (which may be either VOC orNOx or a -combination ofboth) 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 fortheir attainment year.

Serious and above areas willbe developing both a 15 percent VOC plan forthe new portion ofthe 8-hour nonattainment area and an 18 percent VOC/NOx plan for the portion ofthe

area thatpreviously metits 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 forthese areas, as well as moderate

areas that choose option one, will establish motor vehicle emissions budgets for both 2008 and the attainment year. 3. Whatbaseline year shouldbe 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 oftiming concerns related to attainment dates and when data is collected and compiled. However, in response to several comments, we are allowing States the option ofjustifying the use ofan alternative baseline year inventory year forRFP. 

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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 forattainment bythe beginning ofthe ozone season prior to-the area's attainment date: Serious and higher classified areas would need to provide in their SIPs an additional average ofthree percent per. year emission reduction over each subsequent 3-yearperiod beyond the initial 6-year period through the attainment year.
5. What is the timing ofthe submission ofthe RFP. plan?.
For moderate and higher classified
areas, the first RFP SIP mustbe submitted within 3years after the area's nonattainment designation. For areas with aJune 15, 2004 effective date, for the 8-hour designations, the SIP would be due by June 15, 2007. This would provide up to 3years for Statesto develop and submit RFP plans, and 1 additional year (untilthe end of 2008) for control measures to be implemented. The RFP SIP for any remaining 3-year periods outto 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. Werecommend that States complete their RFP plans as

soon as possible after designation to provide more time forsources 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 afterthe baseline emissions inventory
year are creditable forpurposes ofthe
RFP requirements inthis section except

as specifically provided in section

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

182(c)(2)(B) ofthe CAA which exclude four categories ofemissions reductions requirements required to be adopted prior to 1990.
7.For areas covered only by subpart 1, how should the RFPrequirement be structured?

We are finalizing rules fortwo rather than three categories ofareas based on the CAA's division ofattainment dates for subpart I areas under section 1.72(a)(2). The following are the two scenarios and the RFPrequirements for each:

Scenario A:Areas with attainment dates 5 years or less after designation (i.e., for most areas on orbefore June 15, 2009). Reasonable further progress for these areas would be metby ensuring emissions reductions-needed for attainment are implemented, as noted above, by the beginning ofthe ozone

season prior to the attainment date. This would be similar to subpart 2 RFP for

areas classified as marginal.

ScenarioB:Areas with attainment dates beyond 5 years after designation (i.e., beyond 2009).

* The RFP plan must show increments ofprogress from the baseline emissions inventory year outto the attainment date.

* The RFP SIPwould 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 3years after designation (i.e., in 2007).

.* Either NOx orVOC emissions reductions (orboth)could be used to achieve the 15percent 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 ofprogress no less than the amount of emissions reductions that would be roughly proportional to the timebetween the end ofthe first increment (in 2008) and the attainment date.This second RFP SIPwould also have to be submitted within 3 years after the effective date of designation (i.e., in 2007).

8. Where part ofan 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- hourROP plan beused as credit toward meetingthe area's 8-hour RFP plan?

Where an area has both 1-hour and 8- hourRFP obligations for the post-2002 period, the State may rely on emissions reductions from the 1-hour plan in achieving RFP forthe 8-hour standard. The State could develop anew 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 ofthe 8-hour standard nonattainment area). Emissions reductions from measures in the ithour ozone SIPthat are achieved after the 8-hour ozone NAAQS baseline
year could count (subjectto creditability restrictions as discussed above) toward meeting the RFP requirement for the entire 8-hour area.

This approach would set an RFP target forthe 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 oldtarget are met; see 40 CFR 51.905(a)(1)(iii)).

9. Will EPA's "Clean DataPolicy" apply -forpurposes of 8-hour RFP, attainment demonstrations and other related requirements?

We intend to apply the Clean Data Policy, whichwe had applied under the 1-hour standard, for purposes ofthe 8- hour standard. In this action EPA is finalizing the statutory interpretation that is embodied inthe policy. The text ofthe final rule encapsulates the statutory interpretation set forth inthe 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

amodular way, as long as the 6lements oftheirTIPs are reasonably "severable."

11. How will RFP targets be calculated?

Appendix A to the preamble to this finalrule provides calculation procedures for determining the RFP targets. These have beenrevised from those inthe proposal to account forNOx and for emissions models in addition to the MOBILE model.

12. Should EPA continue the policy of allowing substitution ofcontrols 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 mustbe shown tobe beneficial toward reducing ozone inthe nonattainment area and must ensure that the reductions meet the standard
tests ofcreditability (permanent, enforceable, surplus, and quantifiable).

13. When must RFP emissions' reductions be achieved?

The target level of emissions mustbe
metby the attainment date ofthe attainment year. Section 182(c)(2)(B) requires that RFP be continued out to the attainment date. 71616: .Federal Register /Vol. 70, 

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14. Banked emission reduction credits (including shutdown credits): Can prebaseline emission reduction credits'be used to satisfy the RFP requirement?

* Thebaseline emissions should not include pre-enactment banked emission credits since they were not actual emissions during the calendar year of enactment ofthe CAA Amendments of 1990.

* Banked emissions reductions credits created prior to enactment ofthe CAA Amendments of 1990 are not creditable towardthe 15 percent progress requirement. However, for purposes ofequity, EPA encourages States to allow sources to ue such banked emissions credits for offsets and netting asauthorized.

e When States use such banked credits for offsets andnetting to the extent otherwise creditable under the partD NSR regulations, these preenactment emissions credits mustbe treated as growth. Prior guidance on this issue is still relevant for banked emission reduction credits inrelation to the RFP requirement forthe 8-hour

ozone standard. However, because the rulefor implementing the 8-hour ozone standard uses a 2002 baseline year, the prior guidance should be interpreted with thatbaseline in mind instead of enactment of the CAA Amendments of 1990.

F.Are contingencymeasuresrequired in the eveiitof failuretomeet amilestone

orattainthe 8-hourozoneNAAQS?

Contingency measures are required to be implemented inthe event offailure to meet a milestone orattain 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. Whatrequirementsshouldapply for RACM andRACT for8-hourozone nonattainment areas?
1.Reasonably Available Control Technology (RACT)

For subpart 1 areas that submit a demonstration ofattainment for 5 orless 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 1areas 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 orportion thereofwhich

occurs 30 months after the required submittal date.

Where aRACT SIPis 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 orthrough a
new RACT determination. Statesmay
use existing EPA guidance inmaking 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, orRACT determinations orcertifications for groups ofsources, 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 SIPrevision demonstrating that ithas adopted all control measures necessary to demonstrate attainment as expeditiously

aspracticable and to meet any RFP requirements.

H. Howwill the section 182(f)NOx provisionsbe handledunderthe 8-hour

ozonestandard?

The finalrule allows a person to petitionthe Administrator for an exemption from nonattainment major NSR and/or RACT requirements for major stationary sources ofNOx in 8- hour ozone nonattainment areas and for any area in a section 184 ozone transport region. The final ruleincludes

an extension ofthe NOxwaiver provisions to 8-hour ozone nonattainment areas covered under

2This is generally expected with the submission ofthe attainment demonstration.

3Alternatively, a State need not perform a NOx RACT analysis for s6urces subjecttW Federal. implementation plan thatimplements the emission reductions required by theNOx SIP.call or the CAIR. subpart 1 (asproposed) as well as. subpart 2nonattainnient aras. In addition,the final rule states that a section 182(f) NOx exemption granted under the 1-hour ozone standard does
notrelieve 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. ShouldEPApromulgateaNSR provisionto encouragedevelopment patternsthatreduceoverallemissions?
Section V ofthispreamble below addresses rules for NSR forthe 8-hour

ozone standard. We are not atthis time issuing any rule related to Clean Air Development Conmunities (CADCs). 

### J.How willEPA ensurethatthe 8-hour

ozone standardwill beimplementedin

a waywhichallowsanoptimalmix of controls forozone, fineparticulate
matter PM 2.5 ), andregional 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 forregional haze.

K. Whatemissionsinventory requirements shouldapplyunderthe 8- hourozoneNAAQS?

Existing ozone-relevant emissions data element requirements under 40 CFR 51 subpart A are sufficient to satisfythe emissions inventory data requirements under the 8-hour ozone NAAQS.

L. Whatguidanceshouldbeprovided thatisspecific to Tribes?

Section 301(d) ofthe CAA recognizes that American Indian Tribal governments are generally the appropriate authority to implementthe 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 ofthe provisions ofthe CAA, exceptthose provisions for which EPA has specifically determined that it is not appropriate to treat Tribes in the same

4Memorandum dated January 14, 2005, "Guidance on LimitingNitrogen Oxides (NOx) Requiiements'R6lated to 8-Hour'Ozone

- Implementation" from Stephen D. Page, Director, Office ofAir,Quality Planning and Standals, to Air Directors, Regions I-X. 

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manner as States. (TheCAA provisions forwhich EPA has determined it is not appropriate to treat Tribes in the same

manner as States are listed in section IV.L. ofthis preamble.) Examples of CAA provisions forwhich 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 invery limited circumstances, State regulations do not apply to.IndianCountry, 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 willhelp ensure that the planning decisions made by-the States and Tribes complement each other and achieve • progress toward meeting the NAAQS.

M. Whatarethe requirements forOzone Transport Regions (OTRs) underthe 8- hourozone standard?

Section 184 continues to apply for
purposes ofthe 8-hour standard; therefore, the current OTR remains in place and the section 184 control requirements continue to apply for' purposes ofthe"8-hourstandard. Ifa

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 ofsection 184.

N.Are thereanyadditional requirementsrelatedto enforcement andcompliance?

We are not setting forth any additional rulerelated to compliance and enforcement:

0. Whatrequirementsshouldapplyto

- emergencyepisodes?

We have notyet proposed any rule revision related to emergency episodes (at 40 CFRpart 51, subpart H), and the final rule below does not contain any such rule revision.

P. What ambientmonitoring requirementswillapply underthe 8- hourozone NAAQS?

No monitoring requirements are beifig promulgated as part ofthisrulemaking. The preamble discusses current relevant requirements (40CFR part 58) and anticipated activities. 

### Q. When willEPA require8-hour attainment demonstrationSIP submissions?

Modeled attainment demonstrationswhere required-must be submitted within 3 years after the effective date of the area's nonattainment designation.

R.How willthe statutorytimeperiods in the CAA beaddressedwhen we redesignateareasto nonattainment followinginitialdesignations forthe 8- hourNAAQS?

For any areathat is initially designated attainment or unclassifiable forthe 8-hour NAAQS and subsequeritly redesignated to nonattainment forthe 8- hour ozone NAAQS, the attainment date and dates for submittal ofany applicable requirements under subpart 1

or subpart 2 and these regulations would run from the date of redesignation to nonattainment forthe 8-hour NAAQS. Summary ofSection V (Below): EPA's Final Rule for New Source Review

Intoday's action;,we are finalizing' previously proposed changes to three regulations that govern major NSR permitting ofmajor stationary sources in nonattainment areas---40 CFR 51.165, appendix S of40 GFRpart 51, and 40 CFR 52.24.:." %1,7"

.The regulations at40 CFR 51.165 contain the minimum elements that a State's preconstruction permitting
program formajor stationary sources in nonattainment areas mustcontain in orderfor 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 titleI ofthe CAA, as amended in 1990, for the 8- hour ozone NAAQS, the CO NAAQS, and the PM10 NAAQS. We are also promulgating finalchanges 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 of40 CFR part 51 contains the preconstruction permitting program that applies to major stationary

- sources innonattainment areas lacking

an approved part D NSRprogram. 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 Sthat we

are making to §51.165 to implement the' CAA as rbisedby'!the 199.0' Amendments. In addition, we are finalizing revisions to sectioriVI'of' appendix Sto qualify applicability of this section. This revision is an outgrowth ofthe proposed revisions to section VI in the 8-hour NAAQS

. .implementation proposal (68 FR 32802). We also are removing an outdated exemption forsources increasing emissions less than 50 tons peryear S(tpy). '

The regulations at 40 CFR 52.24 contain restrictions on the construction

or modification ofmajor stationary
sources, including a construction ban applicable in circumstances enumerated -bythe 1977 CAA. These regulations also apply ifthe Administrator determines pursuant to CAA section 173(a)(4) that the State.is notadequately implementing the SIP for meetingthe part D requirements. today's finalrules codify requirements of the 1990 CAA Amendments related to the applicability ofconstruction 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 ofdesignation as nonattainment and the date the partD plan forNSR is approved, but is updatedto 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 oftitle Iofthe 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 leastuntil they

are redesignated to attainment for the 8- hour standard. Similafly, areas that have been reclassified as severe areas under section 181(b) ofthe 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 forfuture 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 ofthe '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, forthe original nine mandatory areas as well as the

areas reclassified to severe. Finally, EPA clarifies that the current opt-inrules willremain 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 ofSection VII (Below): Other Considerations

A. HowwillEPA's implementationof the8-hourozone NAAQS affect funding, underthe Congestion MitigationandAir QualityImprovement(CMAQ)Program?

This section describes the relationship between the CMAQ program and the 8-hour ozone NAAQS implementation program.
B. Whatis therelationshipbetween implementationofthe 8-hour standard' andthe CAA's title Vpermits program?
The interrelationship between implementation ofthe 8-hour ozone standard and the title V permits program was not discussed in the proposed rule. However, various questions have beenraised 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 Vapplicability is affected by the new 8- hr ozone standard and the revocation of the 1-hour ozone standard.

C. What actionis EPA takingon the OverwhelmingTransportClassification forsubpart1areas?
We are notcompleting rulemaking on the overwhelming transport classification in this rulemaking. This section discusses the status ofthe rulemaking.

IV. Final Rule forPhase2 Elements OtherThanNew Source Review and Reformulated.Gasoline

The discussion ofmany ofthe regulatory elements below address timing ofrequired actions, such as submission dates for SIP revisions. The discussion is primarily directed toward 8-hour ozone nonattainment areas for which the effective date ofthe designation wasJune 15, 2004. However, anumber ofareas 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 ofthose designations. Incases inthis preamble where we have used June 15, 2004 as a substitute for the "effective date," we are using it only for purposes ofthose areas with an effective date of June 15, 2004.

A. Shouldprescribed requirements of subpart 2applyinall8-hour nonattainment areasclassifiedunder subpart 2, oris there flexibilityin applicationincertainnarrowly-defined circumstances?

[Section VI.D. ofJune 2, 2003 proposed rule (68 FR 32825); no draft or finalregulatory text.]

1.Background

The 1990 CAAAmendments overhauled the CAA's requirements for

ozone nonattainment areas and, in doing so, specified new mandatory

measures formany areas. The approach embodied in subpart 2 was to classify

areas according to the severity oftheir 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 inthe 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 ofmandatory measures from both alegal andpolicy standpoint. Our legal viewis guided by the statutory language in part D of titleI ofthe CAA. In addition, we
wereguided by the Supreme Court's view ofthis language. Our policy view is guided by past precedents and also the principles we setforth 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 2requirements apply. While certain requirements allow for some flexibility inhow they apply, the requirements do not allow forbroad waivers. For example, all areas classified as serious

orabove must meetthe requirement for

an enhanced inspection.and maintenance (I/M) program, however, there is some flexibility in determining what type ofI/Mprogram meets the requirement for an enhanced I/M program. The Supreme Court, in addressing whether the classification provisions in subpart 2 applied for purposes ofthe 8-hour ozone NAAQS found thatthey 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. Whitmanv. American TruckingAssoc., 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 ofaspecific 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 abasis for waiving a prescribed requirement on a case-by-case basis where imposition ofthe requirement would create an absurd result.However,

as stated in the proposed rule, we believe that absurd results that might

occur from application ofmandatory control measures would happen only in

rare instances, Ifa State submits a demonstration that application ofa specific requirement ina specific nonattainment area would create an absurd result,we will consider application ofthe absurd results doctrine at that time.

3. Comment and Responses

Comment:Anumber ofcommenters 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 ifwe make case-by-case waivers from subpart 2 requirements. Several commenters suggested that we take the cost ofcontrols into consideration when determining ifthere

were an absurd result while others suggested that we look atrelative 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 ofsubpart 2 mandatory

measures. One commenter felt that substitution ofsubpart 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 ofsubpart 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 acategorical exemption as an exercise ofagency powerto allow areas to substitute NOxfor 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 ofsubpart 2 measures because the imposition ofsuch

measures creates economic disincentives forcompanies to locate and expand in nonattainment areas. A number ofcommenters stated that they do not support the vehicle I/M or Stage II vapor recovery programs and recommended that we provide States -with flexibility inmeeting these requirements.

Response:Many ofthe .commenters' suggestions go beyond the application of

an absurd results doctrine and instead suggest broad waiver ofsubpart 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 1gives EPA considerable discretion to shape nonattainment programs, subpart 2 prescribes large parts ofthem bylaw" 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, webelieve that case law may provide EPA with limited flexibility to waive federally mandated requirements

on acase-by-case basis where -application ofthose 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 inthe context ofaspecific request. In general,

we note that to demonstrate an absurd result, a State would need to demonstrate that application ofthe requirement would result inmore harm than benefit. For example, the programs mandated under subpart 2 are generally effective in reducing emissions ofthe
two ozoneprecursors-NOx and VOCand because reductions ofthose precursors generally lead to improved air quality, we believe that such a demonstration could be made, ifat all, only inrare instances.

With regard to the comment relating to,Stage II vapor recovery, section 202(a)(6) ofthe CAA does provide for revision or waiver ofthe 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 ofsuch standards and the Administrator may, by rule, revise or waive the application ofthe requirements ofsuch section 182(h)(3) for areas classified under section 181 as Serious, Severe, or Extreme forozone, as appropriate, after such time as the, -Administratordetermines that onboard emissions control systems required under thisparagraph are in widespread

use tlfroughout the motor vehicle fleet." Currently, EPA is formulating policy concerning how widespread use willbe 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 nothave the statutory authority to create new waivers to subpart 2requirements. 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 nothave broad authority to waive subpart 2requirements and that the CAAitself does notexpressly create authority to waive such requirements. However, the "absurd results" line of

cases provides that where application of

a statute as written would create aresult
counter to what Congress intended, an Agency has limited authority to construe that provision in amanner than would effectuate Congress' intent.5

- See Holy Trinity Church v. United States, 143 U.S. 457 (1892).("Ifliteral construction ofthe words ofa statute be absurd, the Act mustbe 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. Howwill we addresslong-range transport ofground-levelozoneandits
precursorswhen implementing the 8- hourozone.standard?. [Section VI.F. ofJune 2, 2003 proposed rule (68 FR 32827); no draft or finalregulatory 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) ofthe 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, orinterfere with maintenance, in one ormore downwind States. Section 110(k)(5) ofthe CAA authorizes EPA to find that a SIP is substantially inadequate to meet any CAArequirement, including the requirements of section 110(a)(2)(D) of the CAA. Ifwe make such a finding, we must require the State to submit, within

a specified period, a SIPrevision 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 ofair 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 formeeting 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 inthe 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.) Inthat rule, we determined that the same level ofemissions reductions

was needed to address transport forboth the 1-hour and 8-hour standards.6

The NOx SIP CallRule is achieving substantial emissions reductions and air quality improvement well in advance of the attainment dates of8-hour nonattainment areas. Inthe eastern United States, monitoring data shows a 10.percent improvement between 2002 and 2004 inthe seasonal (MaySeptember) average of daily maximum 8-hour ozone concentrations, after adjustment formeteorological differences. The EPAbelieves 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 underphase I ofthe NOx SIP Call was May 31, 2004. All ofthe 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 theirNOx control programs. State programs to implement the rulehave focused onreducing emissions from electric power generators and large industrial emitters. The phase II NOx SIPCall 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 halfofthe 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 morethan 100

areas in thatregion 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 ofthese

areas in nonattainment in 2010.This estimate is derived from base case CAIR modeling results shown inthe final notice for the CAIR (70 FR 25254, Table VI-12).

On May 12, 2005, EPA published the Clean Air Interstate Rule inthe Federal Register (70 FR25162). The EPA determined that 28 States and the District ofColumbia contribute

6In light ofvarious challengesto the 8-hour NAAQS, we stayed the 8-hourbasis for theNOx SIP Call Rule (65 FR56245; September 18, 2000). significantly to downwind nonattainment, or interfere with maintenance, ofthe PM2.5 and 8-hour

ozone NAAQS in other States. The rule requires these States to submit SIP revisions to reduce SO 2 and/orNOx emissions.

To reduce interstate ozone transport, the rule established statewide ozoneseason NOxbudgets for 25 States and the-District ofColumbia. The budgets

are based onthe level ofemissions 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 tobe achieved intwo phases. For summertime NQx, the first phase starts in 2009 (covering 2009- 2014); 7the secondphase ofNOx reductions beginb in 2015 (covering 2015 and thereafter).

The 25 States that are required to
meet a summertime NOx cap forozone 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 ofthe impacts of pollution transported across State borders, and ofhighly cost-effective control opportunities forNOx.

As detailed inthe final CAIR action, the CAIRrule will further reduce ozone transport to assist States intheir efforts
to bring ozone nonattainment areas into attainment or-inthe case ofdownwind receptor areas that.attain prior to some

or all'CAIR reductions-maintain air quality meeting the 8-hour ozone NAAQS. Inthe CAIR rulemaking, EPA projected that 39 counties (inthe 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.

8The CAIR requires summertime NOx reductions in the following States not covered by theNOx SIP Call: Arkansas, Florida, Iowa, Louisiana, Mississippi, and Wisconsin. The NOx SIP Call has requirements fortwo States not covered byCAIR

ozone requirements: Rhode Island and Georgia. The EPAhas proposed a stay ofapplicability ofthe SIP Call to Georgia as an initial response to apetition forreconsideration on whether Georgia should be covered. standard in 2010 in the absence of further control requirements (i.e., the base case without CAIR). Most ofthese counties.were projected to be within a fewparts perbillion (ppb) ofthe 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.

Webelieve that States willbe able to demonstrate timely attainment for most 8-hour ozone nonattainment areas with the help ofemissions reductions from Federal )rules.However, we also believe that alimited number ofdownwind
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 ofhistorical difficulties with attaining the 1-hour

ozone standard. The EPA determined in the CAIR that even ifall downwind receptor areas attained ontime, many

areas will remain close enough to the standard to be atrisk offalling back into nonattainment. The EPA concluded that the 2015 summertime NOxreductions will assist attainment and maintenance ofthe 8-hour standard.9

In addition to controlling.interstate air pollutionunder section 110(a)(2)(D), EPA national rules and State rules for controlling.local sources ofemissions

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, willbe able to take required upwind reductions into account. Depending on the particular area, thdupwind" reductions will help to hasten attainment ofthe NAAQS, make attainment and maintenance ofthe NAAQS less difficult and costly,or both.

The EPA notes that interstate pollution transport willbe furthei reduced through cost-effective measures that individual States adopt for
purposes ofbringing their ozone

9Forthe 22 counties projected to be in nonattainment in 2015 in the absence offurther control requirements (i.e., the CAIRbase case), the
average ozone reduction in 2015 from CAIRis 1.1 ppb, andthe 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 SIPCall. Some added that this-puts northeastern States located in the OTR in a situationwlere their citizens and businesses are bearing

a disproportionate burden ofhealth 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

arule 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 ofpartD oftitle I) for State plans to implement the 8-hour NAAQS. We have addressed the section 110(a)(2)(D) obligation through the NOx SIPCall and CAIR, which provide substantial air quality benefit for downwind areas significantly affected by transport ofpollution from other States.

Comment:Two commenters recommended a regional approach among Statesto address transport. One
commenter thoughtthat Clear Skieg is the best way to address transport,but absent that, would support aregional 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 forregional planning there

were disincentives. Another commenter thought that EPA unrealistically expects

10

Many types ofsources contribute to ozone transport. The CAIR reduction requirdments are based solelyupon potentialreductions from EGUs; EPA did not findother source typeshighly cost effective tocontrol. 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 inthese situations. One commenter thought the development ofmultiple 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 ifwe 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 ofStates have worked effectively together inthe past to address regional

ozone problems. For example, the Lake Michigan Air Directors Consortium (LADCO) was established in 1990 by the States ofIllinois, Indiana, Michigan, and Wisconsin. The main purpose of LADCO is to provide technical
assessments for and assistance to.its member States on problems ofozone 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 SIPfor that area and inreducing 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.

Inresponse 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 oftransport that establishment ofa transport region would be intended to address, without the costs ofsetting up acommission to

oversee the transport region.

Comment:Some commenters stated that we should notrely onthe proposed Clear Skies legislation to reduce emissions transport because there is no guarantee that the legislation willbe enacted. Several State commenters added that Clear Skies would not provide adequate ortimely emissions reductions. Another commenter suggested that we work with Congress to enact legislation to allow for the development and use of atransport 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 ofthat process is uncertain. To ensure that regional transport is addressed in atimely
manner, EPA finalized the CAIR inMay 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 ofthe criteria for determining the adequacy ofa 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 ofozone 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 oflong-range transport ofozone and its precursors. At thattime, EPA concluded that without some certainty ofwhat levels ofemission controls would be required in the larger region States faced greatuncertainty regarding the
amounts ofozone and precursor concentrations being transported into the modeling domain ofthe nonattainment areafor 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 ofupwind States under section 110(a)(2)(D). In this
way, eastern States could then have a fair degree ofcertainty regarding required upwind reductions and the
amount oftransported 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 riskthat States working together in a collaborative, fashion would not agree on aregional 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 SIPplanning for the individual areas, and on the contrary, will provide the certainty needed to complete the attainment demonstrations in atimely manner.

The commenter also proposed that rather than addressing transport through national measures, We could include transport as one ofthe criteria for determining the adequacy ofa SIP. It is
true that section 110(a)(2)(D)(i)(I) requires a SIP to "contain adequate provisions * * * prohibiting, consistent with the provisions ofthis title, any
source or other type ofemissions activity within the State from emitting any air pollutantin .amountswhich 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) ofthe CAA require States to submit SIPs that implement, maintain, and enforce a new orrevised NAAQS within 3 years ofpromulgation ofthe standard. Among other things, these SIP revisions must address aState's significant contribution ofpollution to nonattainment and maintenance problems in other States under sdction 110(a)(2)(D). OnMarch 10, 2005, EPA officially notified States that they have failed to submit SIPs to satisfy this requirement ofthe 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 EPAto 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 CAIRwould satisfy the requirement andturn offthe FIP clock.. C.How willwe addresstransport of ground-levelozoneanditsprecursors forruralnonattainmentareas,areas affectedby intrastate transport, and

areasaffectedby international transport?

[Section VI.G. ofJune 2, 2003 proposed rule (68 FR 32828); no draft or finalregulatory text.] 11

1.Rural Transport Nonattaiiiment Areas

a. Background

In the June 2, 2003 proposal, we noted that section 182(h) ofthe CAA (under subpart 2)recognizes that the ozone problem ina 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 2that 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 forthese areas will depend onthe schedu'le for adoption andimplementation ofcontrol

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 ofFinal Rule

The final rule doesnot contain any revisions to current policy onrural transport areas under section 182(h).12

c. Comments and Responses

Comment:Several commenters favored the proposed approach ofnot revising ourcurrent policies with regard to subpart 2 areas that meet the criteria forbeing arural transport areaunder section 182(h).

Response:We agree withthese
comments.

Comment: Several commenters urged

us to provide more flexibility such as extending the provision to other areas whose problems are caused by transport butthat do not qualify as rural under section 182(h).

Response:These commenters did not suggest anylegal mechanism for

"This section oftheproposal also addressed multi-State nonattainment areas. The discussion of multi-State nonattainment areas is now covered under the discussion below on attainmefit demonstrations andmodeling.

" Based on currentinformation, we do not believe there are any 8-hournonattainment areas covered under subpart 2 that are "rural" and therefore eligible forconsideration forcoverage under section 182(h). Existing policy on rural transport areas includes the "General Preamble for theImplementation ofTitle I oftheClean 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 notfound 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

Inthe proposed rule, we noted that a number ofState air agency representatives had voiced concern about intrastate transport ofozone 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 outthat a State could recommend designation of nonattainment areas that are large enough to encompass upwind and downwind areas ofthe State and require that the individualjurisdictions work together on an attainment plan that accounts fortransport 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 ofthe CAA provisions.

b. Summary ofFinal Rule

The finalrule does notcontain any additional provisions for addressing intrastate transport for the reasons stated inthe 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 indetermining 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 ofpollution from sources within itsjurisdicti6n.

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 inthe proposed rule (68 FR 32829), we agree with the commenters that States have the obligation and authority to address the transport ofpollution from one area

13

Intrastate transport also couldbe considered in determining the attainment date that is as expeditious as practicable for subpart 2 areas, but ifthe date were later than allowed for thearea's classification, the State would need to request bump-up ofthe area to ahigher classification for that date tobe approved. 

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ofthe State to a different area of the State.

Comment:Several comments recommended an intrastate transport classification.

Response:Our response to those
comments is in theresponse to comment document forthe Phase 1 Rule of April 30, 2004. (Docket document OAR-2003-0079-0717; p. 68.)

3. How willEPA address transport of ground-level ozone and its precursors forareas affected by international. transport?

a. Background

As discussed inthe proposal, international transboundary transport of

ozone and ozone precursors can contribute to exceedances ofthe NAAQS. It is possible that the international transport ofair pollutants
may affect the ability ofsome areas to attain and maintain the 8-hour ozone NAAQS. Section 179B ofthe CAA (International BorderAreas), applies to nonattainment areas that are affected by emissions emanating from outside the United States. This provision requires EPA to approve a SIP foran ozone nonattainment area ifit meets all ofthe requirements applicable under the CAA, other than a requirement that the area demonstrate attainment and maintenance ofthe 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 rulerecommended that States should confer with the appropriate EPA Regional Office to establish on acaseby-case basis the technical requirements for these analyses.

b. Final Rule

As inthe proposal, we are not setting forth any regulatory provisions related
to international transport. Section 179B ofthe CAA applies forthese 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 subjectto 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 aburden 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 ofthe CAA to ensure they are streamlined and notunnecessarily burdensome on States in making an international transport demonstration. Another commenterthought that the proposed rule does not adequately address ozone from international
sources, especially in a situationwhere

a State does not havejurisdiction over most ofthe 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 ofsection 179B and allow consideration ofthe impact on attainment of smoke from crop burning activities in Southern Mexico and Central America.

Response:The CAA notEPA's proposed rule, places the burden on States to demonstrate that an areawould be able to attain but for emissions from

.sourceslocated 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 asthey develop these demonstrations. We recognize that adequate data for foreign sources may notbe available to States. Therefore, modeling, according to the modeling guidance for attainment demonstrations,
may notbe possible inall cases. Because the availability ofinformation and the causes ofinternational pollution vary significantly from one area to another, EPA contiinues to believe that thebest approach for addressing international transport is for States to workwith 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 ofthe impact on attainment ofsmoke from crop burning activities in Southern Mexico and Central America, inmany cases it may notbe possible to confidently quantify the impacts to the total ozone loadings from individual foreign sources that are hundreds or even thousands ofmiles 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 fromthose 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 inattainment planning.

With respect to the applicability of section 179B to areas affected-by emissions from very distant, foreign
sources, EPA currently has nottaken a position. Ifand when there are any SIP submittals that request a section 179B dispensation on such abasis, EPA will examine those submittals on a case-bycase basis, including focusing on the sufficiency ofthe technical demonstration, in orderto make a determination ofsection 179B applicability.

The EPA considers international transport ofpollution 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 inthe 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. ofJune 2, 2003 proposed rule (68 FR 32830); §51.908 in draft and final regulatory text.]

As noted inthe proposal, an attainment demonstration SIP consists of(1)technical analyses to locate and identify sources of emissions that are causing violations ofthe 8:hour NAAQS within nonattainment areas (i.e., analyses related to the emissions inventory required forthe 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) ofthe CAAthat can be implemented without further action by the State orthe Administrator to cover failures'to meet RFP milestones and/or

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attainment. The final ruleretains three ofthese foi lerhenfs, terecestion teiefthe exeptn being.te.requirement for acomitment 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 timingofimplementation 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 inthe remaining paragraphs of§ 51.908.

Inthe 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 ofwhich we discussed elsewhere in the preamble to the proposed rule and which are discussed in later sections ofthis preamble.

1. Areas With Early AttainmentDates

a. Background

The proposal noted that under section 182(a), marginal areas, whichhave a maximum attainment date of 3years 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 ofthe 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 ofnational 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 andTier II motor vehicle tailpipe standards, projects major ozone benefits f6r the 3-year period of 2004- 2006. Attainment formany areas classified as marginal is further indicated by subsequent modeling used to support the CAIR. This 3-year period coincides with the period that would be used to determine whether an area attains the 8-hour standard within 3

14Even though the June 2, 2003 proposal contained thereference to. the 0.005 ppm criterion, the draft regulatory text issued forpublic comment.' didnot contain areference to this criterion. years after designation for areas classified as marginal. I

Ifexisting modeling for amarginal

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 orTribe to develop

an attainment demonstration using photochemical grid modeling. (See 68 FR 32831; June 2, 2003.) Even though modeling is notrequired, it may be prudent.

• In

the proposal, we noted that many subpart 1 areas are projected through regional modeling to come into attainment within 3years 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 ofthe standard and where regional or national modeling exists that is appropriate foruse to demonstrate the

area will.attain the 8-hour standard within 3years after designation (i.e., based on data from 200,4-2006).

We proposed that areas subject only
to subpart 1may request an attainment date no later than 3 years following designation for the 8-hour NAAQS by submitting within 1year ofthe designation aSIP that demonstrates the

area will attain within 3 years following designation. The demonstration must include modeling results and analyses that the State is relying onto support its claim. Suchmodeling mustbe consistent with EPA guidance and must be appropriate for the area. b. Summary ofFinal Rule

Although we proposed that subpart 1

areas requesting an attainment date within 3years after designation should submit their attainment demonstration within 12 months, wehave removed that provision from the finalrule. A subpart 1 area is free to choose to submit its attainment demonstration at any time prior to the 3-year due date.ia As is the case with allrequired attainment demonstrations, the demonstration mustbe submitted no later than 3years following designation and mustbe appropriate foruse in the

area. We anticipate that most subpart 1

areas willbe included in the modeling analyses conducted by areas with later

'1The 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 ofa complete SIP attainment demonstration. Formore informatibn onestaBlishing an early 8-hour ozone' SIP and howit cduld.be usedfor 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 orregional modeling. The demonstration must include modeling results and analyses that the State or Tribe is relying on to support its claim. Such modeling should beconsistent with EPA guidance and should be applicable and appropriate forthe area.16 Ifacceptable 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 therequirement 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 meetthis requirement, a State must demonstrate that the area will attain by a specified date and identify and adopt the control measures that willbring the area into attainment. We see no authority for waiving this requirement for areas.

Comment:What are the requirements forsubpart 1 areas requesting attainment dates within 3years of designation?

Response:Subpart 1 areas must submit their attainment demonstrations within 3years after designation.

2.Areas With Later Attainment Dates

a. Background

For areas with aitainment dates of

morethan.3years after designation, regardless of whether they are covered under subpart I or subpart 2 (except marginal areas), weproposed to require them to submit an attainment demonstration SIP. This proposal was reflected in §51.908(b) and (c) ofthe draft regulatory text. We stated that local, regional and national modeling developed to support Federal or local controls could beused provided the modeling is consistent with EPA's modeling guidance. Several Stateshave invested considerable time and

.resources inregional 8-hour ozone modeling projects following this guidance. Where exceedances ofthe 8- hour ozone standard are more pervasive and widespread than they were for the 1-hour ozone standard, we recommended that Stateswork together inmulti-State modeling efforts and

16Ifan assessment indicates that a regional modeling analysis is not applicable.to aparticular nonattainment area, additionallocal modeling would be required. I I

. ] " f Iii " f 

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leverage offwork under development and resources spent on these projects.'

b. Summary of Final Rule

Subpart 1 areas with attainment dates later than 3years 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 forthe 8-hour ozone NAAQS. Areas with an effective date of designation ofJune 15, 2004 are required to submit an attainment demonstration no later thanJune 15,, 2007. These demonstrations mustbe consistent with section 51.112, including appendix W. Inaddition, for the review oftechnical adequacy, we will generally relyj on our most recent modeling guidance atthe time the modeled attainment demonstration is performed. We will be making available

a final version ofthe 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 .thisguidance. Local, regional and national modeling developed to support Federal orlocal 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 onthe timing of submission of attainment demonstrations is discussed elsewhere. We noted in" the proposal that comments

on the modeling guidance were welcome at anytime and that we would considerthose comments in any future revision ofthat document. We noted that comments submitted on the modeling guidance document would not be docketed as part of thisrulemaking,

17

U.S. EPA, (November 4, 2005), Guidance on the Use ofModels and OtherRelated 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.

18The guidanpe may not apply to aparticular situation, depending upon thecircumstances. 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 EPAregarding aparticular SIP demonstration will only be made-based on the
statute and regulations, and will only be made following notice and opportunity forpublic review and comment. Therefore, interested parties will be able to raise questions and objections about the
contents ofthis guidance and the appropriateness ofits application for any particular situation. nor would a comment/response summary ofthese comments be apart 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) ofthe CAA defines amulti-State ozone nonattainment area as an ozone nonattainment area, portions ofwhich lie intwo ormoreStates. Section 182(j)(1)(A) and (B) setforth certain requirements for such areas. First, each State inwhich a multi-State ozone nonattainment area lies musttake all reasonable steps to'coordinate the implementation ofthe required revisions to SIPsfor 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 SIPrevision submitted under that section 'if a State has failed
to meet the:abov6'iequirements.

To address thelprovisions ofsection 182(j)(1)(A), States that include portions ofa multi-State ozone nonattainment

area should develop ajoint work plan

as evidence ofearly cooperation and, integration, Thework 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 shouldbe taken to coordinate strategies and assumptions in a modele&

areawith those in other, nearby , modeled areas in orderto ensure that consistent, plausible strategies are developed.

Section 182(j)(2).for multi-State nonattainment areas recognizes that one State may notbe,able to demonstrate attainment forthe nonattainment area if other States in which portions ofthe nonattainnment area are located do not adopt and submit the necessary attainment plan forthe area. In such
cases, even though the area as a whole would not have an approvable attainment demonstration, the-sanction provisions of'section 179will not apply inthe portidn ofthenbnattainment* area located in a State that submitted an

..... attainment plan. *, " - b. Summary ofFinal Rule
As discussed in the proposal, State partners involved in amulti-State ozone nonattainment area mustwork 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 ofthe control
program and therefore willbe 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 inthe multi-State area. Consideration oflong-range transport and its contributions to nonattainment is discussed in section IV.B. ofthis preamble. Multi-State nonattainment

areas are subject to the same modeling and attainment demonstration requirements ofthe final rule that apply
to all other areas. Marginal multi-State nonattainment areas do not have to submitamodeled 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 inthe rule how multi-State nonattainment

areas willbe treated ifall ora portion ofan area is subject only to subpart 1. One ofthese commenters requested a clarification thatphotochemical 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 willbe 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) ofthe CAA requires that multi-State areas use photochemical ' grid modeling as part oftheir attainment demonstrations while Section 172 (Subpart f areas) ofthe 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 distinctlofbdtwveen'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 foruse in the area,
or anew one. We do notbelieve 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 performthe modeling formultiState areas. Two commenters stated that if any additional photochemical modeling is required forsuch areas pursuant to CAA 182(j}(1)(B), then EPA. should refine previous modeling; perform new modeling; orapprove 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 byjurisdictional conflicts and inconsistencies.

Response:The EPA has conducted, andwill continue to conduct, regional and national scale nhodeling that covers most ofthe ozone nonattainment areas. Both single State and multi-State nonattainment areas will beable to make use ofEPA modeling, where appropriate. The EPA will work with States to determine the steps necessary foK the proper use ofEPA modeling in

a local attainment demonstration. States that plan to use EPA modeling inlieu oflocal modeling should be prepared to justify the local use ofthe regional projections aswell 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 ofModeling Guidance in
Attainment Demonstrations

a. Background

The proposal noted that section •182(b)(1)(A) requires ozone
nonattainment areas to develop an attainment demonstration which provides for reductions inVOC 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 mustbe based on photochemical grid modeling or any other analytical method determined by the Administrator, inthe Administrator's discretion, to be atleast

as effective." A photQchemical grid model should meet several general criteria for it-to be acandidate for consideration in an attainment demonstration. Wenoted that,unlike in previous guidance,20 we did not propose recommending a specific photochemical grid model for use inthe attainment demonstration for the 8-hour NAAQS for ozone. Atpresent, 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 in40 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 ofModels and Other Analyses inAttainment Demonstrations forthe 8-Hour Ozone NAAQS" and lists

a setofgeneral 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 ofthe draft guideline. The draft regulatory text of 2003 addressed this requirement in §51.908(d).

We noted that we wereplanning to make substantial changes to the draft version ofthis document before finalizing the attainment demonstration aspects ofthe implementation rule. We said we welcomed public comments on the guidance at any time and would consider those comments in any future revision ofthe document. However, we said we would notconsider comments

1 9 As noted above in the discussion ofsubpart 1
areas withearly attainment dates,although the draft regulatory textin § 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 theeffective date ofthe nonattainment designation, this was misleading, since the draft §51.904(b)(2) provision that affected these areas required submission ofa demonstration ofattainment within 3 years after designation. The final regulatory text in § 51.908(b) clarifies this point.

20U.S. EPA, (1991), Guideline forRegulatory Application ofthe 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 onthe UseofModels 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 ofthe modeling guidance inthis present rulemaking.

b. SummaryofFinal 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 atthe time the modeling relied onin the attainment demonstration is performed. This guidance will generally have the State provide (1)technical analyses to locate andidentify sources of emissions that

are causing violations ofthe 8-hour NAAQS within nonattainment areas, (2) adopted measures with schedules for implementation and other meansand techniques necessary and appropriate for attainment that are needed for attainment, with implementation no later than the beginning ofthe attainment year ozone season 22 (e.g., prior to 2009 ozone season for areas withJune 15, 2010 attainment dates), and (3) contingency measures required under section 172(c)(9) ofthe CAA that

can be implemented without further action by the State orthe Administrator 'to cover emissions shortfalls inRFP plans and failures to attain.

c. CommentsandResponses

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 onAir Quality Models," 68 FR 18440, April 15, 2003). Appendix W cites EPA's "Use ofModels and Other Analyses inAttainment Demonstrations forthe 8-Hour Ozone NAAQS" and describes a set ofgeneral 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 ithas been revised to reflectrecent review comments. The procedures described are considered a scientifically

12 See 40 CFR 51.900(g) for definition. 23 U.S. EPA, (1998), Draft Guidance on the Use of Models and Other Analyses inAttainment Demonstrations for the 8-HourOzone NAAQS, EPA-454/R-99-004, http://www.epa.gov/ttn/scram, (Modeling Guidance, File name: DRAFT8HR). 

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valid use ofregional and urban airshed modeling. The modeled attainment test makes use ofthe model derived relationship between ozone and its precursors. Itdoes not, as is the case with proportional rollback, assume equal proportions ofthe 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, ifavailable, should enhance the credibility ofmodel results and results ofother analyses used in a weight ofevidence determination. The EPA believes use of weight ofevidence-is appropriate as do
many in the scientific community. Weight ofevidence-is a credible approach for considering inherent uncertainties in amodeling application. As noted above, we willbe making available a final version ofthe modeling and attainment demonstration guidance forthe 8-hour ozone standard. 2 4 Conjnent: All attainment demoITstrations shouldbe subject to the

samerigorous standards.

Response:The EPA envisions that the final 8-hour ozone modeling guidance willbe available foruse by the majority ofsubpart 1areas and subpart 2 areas classified as moderate and above. However, due to the unique nature of the ozone problem inmany areas, EPA will accept various applications ofthe guidance. Although EPA anticipates all

areas will follow the guidance closely, there will bevariation based on availability ofnew 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 ofozone formation and transport in different parts ofthe country increases. Unique to many areas is the source receptor configuration, level ofprecursor data collected andthe model's ability to simulate unique factors influencing the formation and transport ofozone. As.moreinformation becomes available inparticular areas, EPA expects more rigorous demonstrations will be provided. Areas close to attaining the standard for which there is a betterunderstanding ofthe meteorology and the relationships between precursor emissions and ozone may notrequire asmuch rigor. These decisions willbe made on acase-bycase basis and the public willbe able to
1 24U.S. EPA, (2005), Guidance onthe 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 forregulatory 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 arule. The EPA plans to

use the current (2005) guidance and future updates as abenchmark 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 anyparty, and may not apply to aparticular 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 meetthe 8-hour

ozone NAAQS willbe based on the CAA and our regulations. Therefore, interested parties are free to raise questions and objections about the appropriateness ofthe application of this guidance to aparticular 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 commentperiod on the implementation rule. The EPAhas reviewed and considered the comments and will bereleasing the final guidance. For more information and updates to the modeling guidance for ozone, visit EPA's Technology Transfer Network Support Center forRegulatory Air Models (TTN/SCRAM) onthe Internet, http://www.epa.gov/ttn/scram/. Even though the guidance willbe issued in final form shortly,EPA is always open to suggestions for future improvements
to the guidance, including the incorporation ofmethodologies and procedures that increase accuracy and credibility ofresults. 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 ofdata 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 inthe public domain or licensed forunlimited

use by any person for purposes of modeling within the area.

Response:The EPA modeling guidance supports this commentwhich is addressed in section 10 ofthe modeling guidance. "Applicable models" may be used, ifthey are nonproprietary. A "non-proprietary" model is one whose source code is available for free or for areasonable cost. Further, the

usermustbe 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:-Onecommenter recommended that EPA update its guidance in 40 CFR 51, appendix W to include a discussion ofthe role of weight-of-evidence aspart ofa modeling demonstration, and tomake any updates in appendix W subject to public review.

Response:Inregard to the role of weight ofevidence, EPA does not plan
to revise appendix W. Use ofweight of evidence is dependent onlocal information only available when the technical analysis for a specific model application is under development. Therefore, use ofweight ofevidence is considered on a case-by-case basis as the appropriate Regional Office works with the State as it develops its SIPand during the State adoption process and during EPA's SIP approval process. Any weight ofevidence 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 oris
not making sufficient progress toward attainment ofthe 8-hour ozone standard, aspredicted in its attainment demonstration. We noted that a

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commitment to perform a MCR is a critical element ofan attainment demonstration that employs a long-term projection period and relies on weight ofevidence. Because ofthe uncertainty in long-term projections, we said we believed such attainment demonstrations need to contain provisions forperiodic review of monitoring, emissions, -andmodeling data to assess the extent to which refinements to emission control

measures are needed.

A number ofStates participated in a consultative process with EPA, which resulted in the development ofthe Ihour MCR guidance. 25 We noted that we would update the 1-hour MCRpolicy andtechnical guidance to include 8- hour metrics and that we were soliciting
comment on appropriate revisions. We proposed that the finalMCR 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 aresult ofthe MCR process. Based on the MCR, ifwe 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 aspecified 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 ormore 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 inthe attainment year.
b. Summaryof FinalRule
The final regulatory text does not contain arequirement 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

25Memorandum ofMarch 28, 2002, from LydiaN. Wegman andJ.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 ofthe area's designation in the context ofwhether the attainment demonstration and any weight ofevidence analysis is supportable without a commitment by the State to perform aMCR.

The 8-hour ozone modeling guidance 26is expected to identify measurements and activities to support subsequent reviews ofan 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 byits attainment date. 27 These guidance documents shouldprovide adequate information for developing protocols forperforming MCRs forthe 8- hour ozone NAAQS. States/Tribes should prepare protocols which identify analyses and data bases to be used to support aMCR 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 ofMCRs.

c. CommentsandResponses

Comment:Requiring the MCR 3 or

more years prior to the attainment date is not reasonable orfeasible for some

areas. The EPA needs to recognize that formoderate and lower classifications the MCR would be due atthe time ofthe SIP submittal. Mid-course review should be required only for areas with nonattainment classifications ofserious

orgreater, as at least 3years of monitored data are required for a MCR, after the implementation ofcontrols. One commenter recommended that EPA make the MCR process part ofthe requirements forRFP and ROP.

26U.S. EPA, (2005), Guidance on theUse of
Models and OtherRelated Analyses in Attainment Demonstrations for the 8-Hour OzoneNAAQS, EPA-454/R-05-002, http://www.epa.gov/ttn/scram, (Modeling Guidance, File name: ozone-final.pdf).

27Memorandum ofMarch 28, 2002, fromLydia 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 aMCR; as noted above, EPA.will assess on a case-by-case basis whether a MCR would be needed in the
context ofaparticular attainment demonstration.

Comment:The EPA should develop
proper analysis techniques sothat meteorological conditions do not affect

a nonattainment area's perceived
progress towards attainment. AMCR should also include an evaluation of

ozone transport into the nonattainment

area and control implementation in upwind areas.

Response:Assessments oftransport

are covered inthe MCR guidance. The EPA is improving methods for determining the ozone trends and how they are affected by meteorology. The latest information will bemade available.

Comment:The EPA needs to release the revised MCR guidance before the final ruleis issued inorder for it to be reviewed and commented on during the public comment period.

Response:The finalrule 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 ofan attainment demonstration SIP (i.e., MCR), such as improvements in air quality monitoring, meteorology and emission
measurements. Guidance for performing

aMCR forthe 1-hour ozoneNAAQS identifies several methods for.reviewing whether a SIP is ontrack to attain within prescribed time ]imits.2 9These guidance documents should provide adequate information for developing protocols forperforming MCRs for the 8- hour ozone NAAQS. States/Tribes should prepare protocols which identify analyses and data bases to be used to support aMCR and discuss these with the appropriate EPA Regional Office prior to performing a MCR. Ifwe determine that additional guidance is needed, we will issue updated guidance in a timeframe suitable to support completion ofMCR's within established deadlines.

28 U.S. EPA, (2005), Guidance on the Use of Models and Other Related Analyses in Attainment Demonstrations forthe 8-Hour Ozone NAAQS, EPA-454/R-05-002, http://www.epa.gov/ttn/scram, (Modeling Guidance, File name: ozone-5nal.pdf).

2 9Memorandum ofMarch 28, 2002, fromLydia N. Wegman and J. David Mobley, re: "Mid-Course Review Guidance forthe 1-Hour Ozone Nonattainment Areas that Rely on Weight-ofEvidence for Attainment Demonstration." Located
atURL: 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 asthose 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 ofboth secondary fine particles and ozone. At a minimum, modeling should include previously implemented orplanned measures to reduce ozone, secondary fine particles, and visibility impairment.An integrated assessment ofthe 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 ofmodeling control impacts .onall three programs is further strengthened by the alignment ofthe implementation process for ozone and secondary fine particles. As the dates for attainment demonstration and planning SIPs forthe three programs are anticipated to be fairly close, the practicality ofusing common data bases and analysis tools for all three programs isviable and encourages use ofshared

resources.

The proposal noted that States that undertake multi-pollutant assessments

as part oftheir attainment demonstration would assess the impact oftheir 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 towork 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 aspart of their ozone attainment demonstrations, considering the control programs that

are in place at the time ofthe
assessment. Multi-pollutant assessments

are discussed elsewhere inthis proposedrulemaking.

3oUse ofmodels that are capable ofsimulating transport and formation ofmultiple pollutants simultaneously. For example, for ozone and fine particles, it is critical thatthe model simulate photochemistry, which includes interactions among the pollutants andtheir precursors. b. SummaryofFinal Rule
There is no regulatory text onthe issue ofmulti-pollutant assessments, but we recommend the'following:

* Attainment demonstration modeling should include previously implemented orplanned measures to reduce ozone, secondary fine particles, and visibility impairment.

* An integrated assessment ofthe 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 andwork 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 aspart oftheir

ozone attainment demonstrations, considering the control programs that

are in place at the time of the
assessment.

c. CommentsandResponsesComments:The EPA received several comments on the recommendation that States perform multi-pollutant
assessments as part.oftheir ozone attainment demonstrations. Almost all ofthe comments agreed with the basic rationale behind encouraging an analysis ofthe expected ozone, PM2. 5 , and visibility impacts ofa given set of air quality control measures associated with an 8-hour ozone attainment' demonstration. The comments differed

on whether multi-pollutant assessments should berequired or only encouraged. The commenters who urged EPA to encourage rather than require a multipollutant assessment providedreasons for why they believe amulti-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
notbe a requirement ofan ozone attainment demonstration. Several

reasons were offered for whythe
assessment should remain optional: (1) That the state ofthe 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, butnot requiring, multi-pollutant assessments is the most sound approach fortotal 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 overthe past 3years. As aresult, EPA believes that the available tools are able to support air quality planning. Further improvements

are likely over the next several years; much ofwhich 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 ofepisode days and for geographic regions that are typically less than (intime) 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 ofthe 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 inthe long-term since laterplanning 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. Whatbaseline emission inventory should be used for the attainment demonstration?

[Not addressed in the June 2, 2003 proposal; §51.909 ofthe draft regulatory text.]

The June 2, 2003 proposal did not discussbaselines for purposes ofthe attainment demonstration. (Itdid, however, discuss baselines for RFP demonstrations.) Sction 51.909 of the draft regulatory textprovided that 2002 should be used as the baseline emission inventory year for purposes ofbothRFP and the attainment demonstration for

areas with an effective date of

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designation ofJune 15, 2004. We recognize, however, that some areas have already begun to perform modeling for their attainment demonstrations usingbaseline year inventories earlier than the 2002 inventory, and because the 2002 inventory may notbe in a format to readily be used for photochemical grid modeling. 31 Therefore, the final rule does not specify

a baseline for purposes ofthe attainment demonstration and modeling. As discussed more fully in the section of the preamble regarding RFP, the specification of2002 as abaseline year for RPP purposes (forareas with an effective date ofdesignation ofJune 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 timebeyond the statutory attainment date for their area to attain

as expeditiously as practicable. As discussed inthe 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 ofthese 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 (andmore restrictive) than the

31The EPA guidance on baseline years is found in thememorandum ofNovember 18, 2002, from Lydia Wegman and Peter Tsirigotis, "2002 Base Year Emission Inventory SIPPlanning: 8-hr Ozone, PM2.5 andRegional Haze Programs." This document is available atthe following Web site: http:// www.epa.gov/ttn/oarpglmeta.44g. 1.202baseinv.pdf. That document noted, "The EPAis aware that some

areas have already begun on a voluntary basis to modelfor purposes ofthe 8-hour ozone standard. These areas may continue to usemodeling from previous base years for each setofmeteorological episode conditions for use intheir SIP submittals ifthese studiesare still applicable for an attainment demonstration." areas' 8-hour classification,32 and because the Phase 1 final implementation rulefor the 8-hour 03 NAAQS contains anti-backsliding provisions generally requiring areas to continue implementing measures required forthe 1-hour classification. Although'there may notbe additional mandatory control measures required because the areas may already have such measures inplace, an area that needs more time to attain may need additional emission reductions to reach attainment.

E. Whatrequirements forRFPshould applyunderthe 8-hourozone standard? [Section VI.I. ofJune 2, 2003 proposed iule (68 FR 32832); §51.909 and §51.910 in draft; §51.910(d) infinal regulatory text.]

1.General Discussion

a.Background

As noted inthe 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) ofthe CAA defines RFP to mean "such annual incremental reductions in emissions ofthe relevant air pollutant as are required by this part (partD oftitle I] ormay reasonably be required by the Administrator forthe purpose ofensuring attainment ofthe applicable [NAAQS] bythe applicable date."

Subpart 2 provides more specific RFP requirements for ozone areas classified under section 181. 33 Inparticular, subpart 2 specifies the base year emissions inventory upon which RFP is
to be planned for and implemented, the increments ofemissions reductions required over specified time periods, and the process for determining whether the RFP milestones were achieved.

Subpart 2 does not specify RFP requirements formarginal 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,

32Although some 8-hour ozone nonattainment

areas have additional areas beyond theboundary of the former 1-hour nonattainment area and thus would be.faced with new requirements forthe higher classification.

33Note thet § 51.900 provides thefollowing definitions:

(p)Reasonable further progress(RFP) means for the purposes ofthe 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)ofthe
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)ofthe CAA. section 182(c)(2)(B) ofthe CAA requires each serious and above ozone nonattainment areato submit a SIP revision providing for an actual VOC emission reduction ofat least 3percent per year averaged over each consecutive 3-year period beginning in 1996 until the area's attainment date (referredto as the post-1996.ROP plan for the 1-hour standard). Section 182(c)(2)(C) ofthe CAA allows for substitution ofNOx for VOC emissions reductions for reductions required under section 182(c)(2)(B). The EPA's policy, NOx Substitution Guidance (December 15, 1993; available athttp://www.epa.govl ttn/oarpg/tpgm.html),addresses the

- substitution ofNOx emissions reductions for VOC emissions reductions. Thebaseline emissions inventory for determining the required ROP reductions forthe 1-hour standard is specified in section 182 ds 1990.

The requirements for RFPunder subparts 1 and 2,as described above, are the minimum required foran area. More reductions may benecessary for attainment within the nonattainment

area. Moreover, an upwind area that contributes to nonattainment in a downwind areain the same State may need reductions in order forthe downwind areato reach attainment by its required attainment date. As we noted above in section IV.D.8., we recognize that some areas classified -undersubpart 2 may'need additional time beyond the statutory attainment date fortheir current classification to attain the 8-hour standard as expeditiously as practicable. Inthe
event an area cannot practicably attain by the maximum date for its classification, the CAA provides the opportunity for moretime. 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 ahigher 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 moretime
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 orfully 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 aresult 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 inan 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 ofColumbia (i.e., the eastern part ofthe U.S.where all 8-hour nonattainment areas are classified as moderate orbelow). As noted above, the first phase ofNOx reductions under CAIR starts in 2009 (covering 2009- 2014); the second phase ofNOx reductions begins in 2015 (covering' 2015 and thereafter).-

Withrespect to timing ofreductions, the following table shows how summertime NOx reductions from local CAIR sources that willbe 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

5years of designation; tainment. season preceding latest attainment date. %---Subpart2 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 5years 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 notrequire 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 forsuch emissions reductions forthe RFP period (i.e., an RFP period ending earlier than 'December 31, 2008) during which the reductions occur.

The RFP-provisions inthe CAA for both subpart 1 and subpart 2 areas require .thatactual 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 ofthe CAIRaffected sources that are expected to actually reduce emissions to meet the CAIR requirements and those that are expected to meet CAIRthrough holding allowances and not actually reducing emissions.

Local CAIR NOx reductions that States mustrequire by May 1,2015, could assist in meeting RFP for an area that is bumped up to severe anddemonstrates attainment cannotbe achieved before the end ofthe 2015

ozone season. b. SummaryofFinal RFPFeatures

We are adopting nbarly all the approaches set forth inour proposed rule forthe various 8-hour RFP issues. We are making exceptions where convincing arguments were presented by commenters for a suitable alternative

orwhere, through reassessment ofthe issue, EPA was able to develop abetter option that stillreflects 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 ofthe RFP plan; (b)the structuring ofRFP requirements in subpart 1 areas; (c) the implementation ofRFP in areas designated forthe 8-hour ozone standard that entirely or inpart encompass an areathat was designated nonattainment forthe 1-hour ozone standard; and (d)the substitution of controls from outside the nonattainment

area within 100 kilometers (km) forVOC and 200 km for NOx. These changes are discussed inthe 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 of2002 applies for areas with an 8-hour ozone nonattainment designation effective in June 2004.

- Emissions reductions from outside the nonattainment areaup to 100 km for VOC and 200 km for NOx (and statewide for areas that are part ofa 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, ifused, would need data in the record showing that reductions from sources inthe specific locations,outside the nonattainment

areabenefit the nonattainment area. This is discussed further below in section IV.E.12. of thispreamble.

* For all 8-hour nonattainment areas classified under subpart 2 as moderate

34 Memorandum ofDecember 29, 1997 from Richard D. Wilson to Regional Administrators, Regions I-X re "Guidance forImplementinrg 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 forRFP. Those distances resulted from Federal Advisory Committee Act discussions cited earlier andgenerally represent transport of1 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 inthe process of subjecting this policy to a technical review and may revise itin light ofthat review.

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and above that had not metthe 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 formoderate and above

ozone nonattainment areas. Inaddition, for all 8-hour nonattainment areas classified as serious and above, the RFP provisions in subpart 2 require a VOC

or NOx emission reduction ofat 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 forthe 1-hour standard are treated in the final rulelike 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 forthe 1-hour standard wouldbe subject to the RFP requirement in section 172(e) and the final rule would require them to obtain

an average of3 percent annual reductions ofVOC and/or NOx emissions reductions for the first 6 years after thebaseline year and every subsequent 3years out to their attainment date.

* The periods for RFP under subpart 2for the 8-hour ozone NAAQS run from the date ofthe baseline year; and would be equivalent to the periods Congress established in subpart 2, which applied forthe 1-hour NAAQS. Thus, the first 15 percent reduction would be required forthe 6-year period starting after the end ofthe last day ofthe baseline year (e.g., January 1, 2003-December 31, 2008). The first 3-year period forthe subsequent (average of)three percent peryear emission reduction requirement inserious and higher areas would begin 6 years after the end ofthe last day ofthe 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 orless after designation

can meet the RFP requirement by achieving the emission reductions necessary to attain as expeditiously as practicable. These emissions reductions
mustbe implemented by the beginning of the full ozone season prior to the attainment date (See 40 CFR § 1.908). 35 For subpart 1 areas with attainment

35With 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 (eitherNOx and/or VOC) from the baseline year within 6 years after the baseline Year. For each subsequent 3-yearperiod out to the attainment date,the RFP SIP would have to provide for an additional increment ofprogress. The increment for each 3-year period would be a portion ofthe remaining emission reductions needed forattainment beyond those reductions achieved for the first increment ofprogress (e.g., beyond 2008 for areas designated nonattainment inJune 2004). Specifically, the amount ofreductions needed for attainment should be divided by the number ofyears needed for attainment after the firstincrement ofprogress in order to establish an "annual increment." For each 3-year period outto 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 notmet the 15 percent VOC reduction requirement under the 1-hour standard would be subject to section 182(b)(1) forthe 8-hour standard and would need to obtain the emissions reductions within 6 years after the baseline year (e.g., for areas designated inJune 2004, the reductions would need
to occurby the end of2008, based on

abaseline year 2002).

* Reductions from anyFederal and regional measures promulgated after 1990 (exceptthose measures that were notcreditable under the CAAs creditability provisions (section 182(b)(1)(D)) and achieved after the baseline year are creditable forthe RFP requirement.

* Allow use ofthe "Clean Data Policy."

c. Comments and Responses

This set ofcomments and responses
on our proposal on RFP are ofageneral
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

36For example, ifthe area's attainment dateis 2014,.and a total of30 percent reduction is needed between the end of2008 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 areamust achieve roughly the portion ofreductions equivalentto three annual increments or 15 percent duringthe first 3 years (2009, 2010, 2011), and theremaining amount over the next 3 years (2012, 2013, 2014). Additional discussion ofwhat is meant by "roughly proportional" appears in he full discussion ofRFP for subpart 1 areas in section Iv.E.7. ofthis preamble. would sharply slow momentum to implement healthprotective emission reduction strategies inareas with unhealthful air quality. It would curtail the effectiveness oftransportation conformity in areas with inadequate air quality, including both old and new

ozone nonattainment areas. It would do thisby proposing to eliminate any further RFP requirements forpollution reduction in existing 1-hour ozone

areas.

Response:The EPAhas developed anti-backsliding provisions to ensure continuing progress toward attainment ofthe ozone NAAQS. Under these provisions, areas that are nonattainment for the 8-hour standard must continue to meet most obligations forthe 1-hour

- standard, including RFP requirements. Those provisions (adopted as part ofthe Phase 1 Rulepublished 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 theCAA requirement ofa 15 percent reduction in VOC in the first 6 years. Ifreductions 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 shouldbe able to reduce NOx emissions forRFP requirements.

.

Response:We addressed in general those comments that recommended alternatives to the mandatory measures of subpart 2 (which. includes the RFP requirement) inthe response to comments above under the topic, "Should prescribed requirements of subpart2 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, wenoted that case law may provide support for case-by-case waivers where implementation ofa

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 of3 percent per yearreduction ofVOC and/

or NOx as meeting RFP requirements.

Response:The CAA's RFP provisions do notappear to provide forvariations 

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in the required percent reduction in VOC based on differences ofreactivity ofthe 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 ofreactivity and to tryto determine ifmore cost-effective and greater-ozone reductions can be achieved through use of the concept. The requirement to obtain the required percent reduction oftotal VOCs remains, and ifEPA decides to propose
a change, it would be undertaken in a separate rulemaking action.

2. Whatis the content and timing ofthe 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 ofJune 2, 2003 proposed rule (68 FR 32833); §51.910(a)(1)(ii) ofthe draft and final regulatory text.]

a. Background

Section 182(b)(1) requires areas classified as moderate and above to submit aplan 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 foreach subsequent 3-year period. We proposed two options regarding how thisrequirement 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 anine percent reduction in VOC and/or NOx emissions every 3 years, i.e., an average ofthree percent per year, until attainment. (ii) Option2. Forthose areas that have

an approved 15 percent plan for their 1- hour ozone SIPs, an additional 15 percent VOC reduction is notnecessary. 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 forthe 8-hour standard would be subject to the general RFP requirements ofsubpart 1 in the

samemanner as subpart I areas. Such

an areathat 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 intheir SIPs an RFP plan that would achieve an average ofthree percent peryear ofVOC and/or NOx

over each 3-yearperiod starting atthe end ofthe 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 3years 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 2years 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 ofthe next 3-yearperiods 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 ofNOx and VOC reductions as appropriate to meet the additional ROP/ RFP requirements. For many areas ofthe. country, particularly inthe Eastern U.S. outside major metropolitan areas, there is a greater need forNOx reductions rather than VOC reductions to bring about reduced ambient ozone levels. *Areasdo nothave the flexibility to control NOx under the 15 percent requirement-NOx substitution is only allowed under section 182 forthe post1996 RFP requirement (threepercent peryear 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 ofthe CAA. In some cases, such as for serious and above
areas, this mightresult 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 eitherVOC

or NOx reductions as appropriate. We indicated in the proposal that we preferred this second optionbecause it provides more flexibility for the RFP plan tb be consistent with the area's needs in attainingthe standard. The draft regulatory text incorporated this option.

The proposal did not specifically address an 8-hour area that is partially comprised ofone ormore 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 ofFinal Rule

We are adopting the second option described inthe Background above, as adjusted inresponse to comment.

1. Final rule for 8-hour areas comprised intotal ofone ormore 1-hour nonattainment areas with approved 15 percent plans for the 1-hour standard.

Those 8-hour areas that are composed entirely ofone or more 1-hour areas that have approved 15 percent plans fortheir 1-hour ozone SIPs, will be considered to have metthe 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 ofsubpart 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 ofthe area have previously met their 15 percent requirements under the 1-hour standard, willbe subject to subpart 1 RFP requirements, which will be satisfied with measures that demonstrate attainment as expeditiously

aspracticable.

* Moderate areas that have an attainment date beyond 5 years after their 8-hour designation, for which all portions ofthe area have previously met their 15 percent requirements under the 1-hour standard, willbe subject to subpart 1 RFP requirements, which will be satisfied with a plan to demonstrate 15 percent emissions reductions (which may be either VOC orNOx or a combination ofboth) 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 3percent reductions per year over the 6 years following the baseline year and then an average of3percent peryear for each subsequent 3-year period outto the attainment year.37

37As discussed below in section 5 (the discussion ofthetiming ofsubmission ofthe RFP plan) the RFPplan 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 ormore 1-hour attainment areas with an approved 15 percent plan for the 1-hour standard and in partof one ormore areas without approved 15 percent plans for the 1- hour standard.

For 8-hour moderate areas that include all orpart ofone 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 anew 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 inthis final rule. The reductions must be ofVOC only.

* Approach 2. * Treat the 8-hour nonattainment area

as divided between portions ofthe area that are subject to an approved 15 percent VOC-only plan for the 1-hour standard and the portions ofthe area that are not'subject to a 15 percent plan forthe 1-hour standard.

* For those areas not subject to an approved 15percent plan forthe 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- hournonattainment area.

* For the portion of the areawith an approved 15 percent plan forthe 1-hour standard, the subpart I RFP requirements -willapply if the area is classified as moderate for the 8-hour standard and the section 182(c)(2)(B) RFP requirement will apply ifthe area is classified as serious or above forthe 8-hour standard. These requirements would apply as described above for

areas comprised entirely ofareas with approved 15 percent plans for the 1- hour standard.

c. Comments and Responses

Comment;One commenter expressed

concern that for a number ofsubpart 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 emissionreduction within 6

years from the baseline year and then an additional 3percent peryear precursor reduction after that until the area's attainment date. Specific areas were mentioned such as the South Coast District ofCalifornia and the HoustonGalveston Area, which the commenter indicated willbe wellbeyond best available control technology (BACT) controls andin some cases ator 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 ifadditional 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 (whichincludes 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, oris there flexibility in application in certain narrowly-defined circumstances?" We concluded inthat section that EPA has no discretion to broadly waive mandatory requirements. However, we noted that case lawmay provide support for case-by-case waivers where implementation ofa

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 areaclassified as extreme except that the terms "major source" and "major stationary source" shall include any source with the potential to emit atleast 5 tpy ofVOCs; (2) RACT is required for all major sources (i.e., a

source with the potential to emit at least 5tons per year ofVOCs; and (3)the plan includes all measures that can feasibly be implemented in light oftechnological achievability.38

.

Comment:Another commenter supported EPA in recognizing the previous efforts ofareas 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 provisionfor serious and higher classified

areas that allows less than 3 percent ofbaseline emissions each year after the initial 15 percent reduction after designation and classification. preferred option, which allows States the flexibility to choose acombination ofNOx 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 ifan area has already
met the 15 percent VOC emission reduction requirement forthe 1-hour standard, the area should notbe required to meetthat requirement a second time for the 8-hour standard but instead willbe subject to the other applicable RFP provisions ofthe CAA.

Comment: One commenter preferred Option 1 as more protective ofair quality and more consistent with the requirements ofthe 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 itrelies

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 ofsubpart 2.A 15 percent ROP plan under the 1- hour standard cannot possibly satisfy the 15 percent RFPplan obligation for the 8-hour standard, because the new RFP requirement i designed to implement a revised NAAQS and is measured from a differentbaseline 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 forthe first 6 years for serious and severe areas, there is no lawful orrational 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 nolonger valid.

Response:The EPA acknowledges that under subpart 2 we mustrequire 15 percent VOC reductions for all moderate and above areas, butwe maintain that ifan area has met this requirement while subject to section 182(b)(1)(A).for the 1-hour standard, they will nothave
to meet it again forthe 8-hour standard. The EPA believes thatthe CAA is quite clear that-the SIP mustprovide for a 15 percent reduction inbaseline VOC emissions forsome period after 1990 in

an area subject to section 182(b)(1)(A), and, consequently, the SIPfor any area newly subject to section 182(b)(1)(A) must provide for a 15 percent reduction 

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inVOC baseline emissions.-But,EPA disagrees that the CAA plainlyrequires that the SIPfor an area mustrequire a second15 percent reduction inVOC 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 letthe SIPfor any area clalsified

as moderate orworse forthe 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).

Ifserious and above areas have already metthe 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 peryear over 6 years for atotal 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 forthe 1-hour standard, EPA believes appropriate RFP under subpart 1 should be achieved. For purposes ofRFP under subpart 1,there is nothing thatlimits such reductions to VOC. This provision simply requires reasonable annual incremental reductions towards attainment by the applicable attainment date, and this could beachieved by either VOC or NOx emissions reductions or a combination ofboth.

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 ofthe initial 15 percent reduction requirement for the 6-year period afterthebaseline year. Comment:Another commenter believed the subpart 2 provisions ofthe CAA do notallow forNOx for VOC substitutions for the initial 15 percent RFP requirements.

Response:We agree that the 15 percent requirement in section 182(b)(1) does notallow the substitution ofNOx. 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 orNOx emissions reductions may be counted toward meeting RFPunder those two provisions.

Comment: Some commenters believed

an additional 15 percent VOC reduction should notbe necessary for 8-hour areas that encompass inwhole or in part a 1- hournonattainment areawith 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 notaddress allboundary change scenarios consistent with our proposed approach found in section VI.I.9. oftheJune 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 aportion ofthe 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 ofthe 8-hour area and may be metby one oftwo approaches described above and in the regulatory text. We agree with the second
commenter who noted that the proposed rule did notexplicitly address all possible boundary scenarios; we believe

we have fully addressed these different boundary scenarios in the final rulein

a manner consistent with the proposal.

Comment:A commenter indicated that they preferred to work withEPA 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 mightbe the development of

a "comparability'demonstration," showing that the town hadimplemented the same controls that had been previously responsible for achieving a 15 percent reduction in VOCs inthe 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 ableto meetthe 15 percent obligation for the 8-hour standard ifthe area adopts the same VOC control measures (for example, VOC RACT at the same
source thresholds, I/M, etc. * * *)as in the portion ofthe 8-hour nonattainment

area subject to a 15 percent plan for the 1-hour standard and ifthe area has the

same mix ofemissions sources as in the

area subject to the 15 percent plan for the 1-hour standard. We anticipate we could propose approval of aSIP 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) ofthe draft regulatory text, we insert the language shown in bold:
"An area classified as moderate or higher thathas the sameboundaries as

an area for which EPA fully approved a 15 percent plan forthe 1-hour NAAQS is not subject to section 182(b)(1) ofthe CAA for the 8-hour NAAQS, but instead-(A) Ifclassified 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 ofits designation aSIP revision that prQvides for implementation ofall emission reductions ofVOCs and/or NOx needed for attainment by the beginning ofthe ozone season inthe area's attainment year." The commenter claimed this language is consistent with the approach EPAhas 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) ofthe draft regulatory
textbe revised to allow (evenif conditional) NOx reductions to be substituted for VOC reductions (for any ROP orRFP requirement) whenever such reductions would "result in a reduction in ozone concentrations at least equivalent to that which would result from the amount ofVOC 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 ofsection 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 -the8-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 forthe area.

Another commenter supports an exemption for 8-hour nonattainment

areas that have metthe 15 percent ROP requirement for the 1-hour NAAQS. The
commenter requests that EPA clarify the criteria that the area musthave the same geographic boundaries to qualify for the

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exemption. This means that inthe geographic areas for which a State has

an approved 15 percent plan, the 15 percentrequirement will not apply; and the 15 percent requirement is only intended to apply to the new geographic

areas ofthe 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 thisrequirement.

Response:As we explain in our summary ofthe finalrule, wehave recognized that there are a variety of boundary scenarios for 8-hour nonattainment areas inrelation to the boundaries ofareas forthe 1-hour standard. We have modified the draft regulatory text such that the 'final rule speaks interms of8-hour areas that include all orpart ofan-area with an approved 15 percent plan forthe 1-hour standard. For those portions ofthe 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 ofthe 8-hour standard, but instead will be subject to section 172(c)(2) ifit is an 8-hour moderate area

or subjectto section 182(c)(2)(B) ifit is classified as serious orabove forthe 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 werenot, thenthe 8-hour area can choose whether
to develop a section 182(b)(1) 15 percent plan forthe entire 8-hour area orto develop a 182(b)(1) plan only for the

area not previously subject to such a plan and to treat the remaining portions ofthe area under section 172(c)(2) or 182(c)(2)(B), as described above.

As noted, EPA does not believe the
statute allows itto relieve any area that has not already met the 15 percent requirement forthe 1-hour standard from the obligation to meet that requirement except as provided in section 182(b)(1)(A)(ii).
3. What baseline year shouldbe required for the emissions inventory for the RFP requirement? [Section VI.I.4. ofJune 2, 2003 proposed-rule (68FR 32833); § 51.909 of the draft regulatoiy text; §51.910(d) of the final regulatory text.]

a. Background

Thebaseline inventory forRFP (under subpart 2) is used as the starting point for the determination of atarget level of emissions forthe future yearRFP and as the baseline from which creditable reductions are determined. We designated ozonenonattainment areas in April 2004. Under the "Consolidated Emissions Reporting Rule" (67 FR 39602; June 10, 2002) revised emissions inventories are required forthe years 2002 and 2005; therefore, we proposed
to require use ofthe 2002 inventory as the baseline inventory forthe RFP requirement. This would bethe most recent inventory available at the time of designation. We issued amemorandum identifying 2002 asthe anticipated emissions inventory base yearfor the SIP planning process to address the 8- hour ozone and the PM2. 5 standards. 39

b. Summary of Final Rule

As set forthin our proposed rule, for

areas designated nonattainment for the 8-hour ozone NAAQS with an effective date ofJune 15, 2004, we are requiring Statesto use the 2002 inventory as the baseline inventory for the RFP requirement. As noted in the proposal, the inventory forthe 2002 calendaryear would be the most recently available inventory at the time of designation in 2004. However, inresponse to several comments, we are allowing States the option ofjustifying theuse ofan alternative baseline inventory year for
RFP. Tojustify 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 withthe CAA's RFP provisions. We believe that formultiState nonattainment areas, several States
must agree on a single baseline. Even if

a State chooses an alternative baseline inventory year forRFP, 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 ofa SIP that establishes motor vehicle emissions budgets (e.g., an RFP SIP), Therefore,

areas using thebaseline year testwould continue to use 2002 asthe baseline year for conformity purposes because an area'sbaseline year would notbe 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 orapproved budgets in the RFP SIP in conformity determinations.

39Memorandum ofNovember 18, 2002, from LydiaWegman andPeter Tsirigotis, "2002 Base Year Emission Inventory SIP Planning: 8-hr Ozone,

. PM2 . 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 ofthe effective date ofan 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 of40 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 thereporting period. Thus, the "2002inventory was.due 17months after the December 31, 2002 close ofthe 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 (69FR 23858; April 30, 2004), the baseline emissions inventory shouldbe based on the calendar year 2002 because the 2002 inventory was due under 40 CFRpart 51, subpart A, prior to the time of designation. For areas'with an effective nonattainment designation inthe future, the baseline inventory willbe forthe calendar year ofthe most recent triennial inventory as ofthe date of designation.4° As provided above, the State may use an alternative baseline only ifit 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 areasonable basis to select 2002

as the date ofemissions inventories for the purpose ofestablishing creditaible reductions from the inventory. States

are not required by the CAA to adopt the year ofthe nonattainment designation forthe 8-hour standard as. the basis fortheir planning, even though that was the case under the 1990 CAA Amendments. The commenter claims there are a variety ofmeasures that would be implemented after 2002 that localjurisdictions would liketo be able
to account for as new emissions reductions in theirmodeling 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

onJuly 15, 2003.

Several commenters recommended that the baseline year (startingthe 6-year period forRFP) be set forthe year in which designations were made (i.e., 2004).

40For example, where the effective date of designation to nonattainment for an areafor the 8- hour ozone NAAQS is after June 1, 2007but 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 yearfor RFP SIPs in conformity with both the language ofthe CAA and the inventory year cycle. Ofreasonable importance is the need to maintain consistency with the periodic inventory foruse invarious 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 ofthe RFP baseline, there should be little ifany difference in terms of emissions reductions needed to demonstrate timely attainment. Ifwe

use 2002, the baseline may be higher but

areas can take credit for any 2002-2004 emissions reductions from federally enforceable control measures. Ifwe use 2004, the baseline may be lower but

areas can't take creditfor measures that produce emissions reductions between 2002-2004. Depending onthe area, the difference shouldbe minimal interms ofthe difference inthe 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 ofan inventory forthe 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 ofjustifying the use ofan alternative baseline emission inventory, provided it meets the requirement ofthe CAA's RFP provisions. As noted above, the use ofan alternative year forthe baseline inventory forRFP does not change the requirement to use 2002 as the baseline year fortransportation 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 ofthe RFP plan within 2years after designation. They stat~d that EPA is missingthe point in that the attainment and RFP submission dates established in subpart 2 are to allow States a sufficient amount oftime
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 thisrequirement, it would go far towards minimizing the necessary additional work.

Response:We disagree with the commenters who urged use ofthe 1990 inventories as the baseline forplanning for the 8-hour NAAQS. Use ofthe 1990 baseline would be unreasonable now since it would have to be substantially recalculated due to changes inemission calculating methodologies. Furthermore,

a 1990 inventory was only.required for, nonattainment areas as ofenactment of the 1990 CAA Amendments and therefore may not exi'st for anumber of

areas that are currently designated nonattainment forthe 8-hour standard. Finally, we believe that reliance orl emissions reductions that may have occurred well before 8-hour designations and classifications should notbe counted as making progress toward attainment. Comment:Another cominenter noted that the 18percent 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 of2006 until 2008) would be totally inadequate
to achieve eitherthe 15 percent reduction inVOCs orthe-18 percent reduction inVOCs and/or NOx. The
commenter noted the CAAprovides for submission ofRFP plans within 3years (from 1990) in section 182(b)(1)(A) and 4 years in section 182(c)(2).

Response:The final rulereflects a change from the proposal to allow submission ofthe RFP plan up to 3 years from the date ofdesignation. We do notbelieve the RFP provisions.of subpart 2 ofthe Act provides relieffrom 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 ofthese dates to the expected date ofinitial designation. The
commenter recommends deleting all such specific date references from the regulation, to avoid the need for revising regulations ifthe initial designations are not concluded as expected. This should be replacedby a generic approach, for example by requiring the most recent year's data to be used as thebaseline in ,the second sentence of§51.909. Deleting the calendar-specific dates would not change the result ifthe designations occur as planned, yet would allow for more recent data tobe used iffactors 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 asareas that

are redesignated nonattainment at some point inthe future. Such specific dates

are more appropriately included as examples in agency guidance orwithin the preamble ofa final rule with a discussion ofhow 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 thispoint,

we believe it is appropriate to specify 2002 as the presumptive baseline year. The finalversion ofthe rule (now §51.910(d)) provides general language regarding the appropriate baseline year for areas that have an effective date of

a nonattainment designation inthe 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 ofJune 2, 2003 proposed rule (68 FR 32834); no draft regulatory text; section 51.910(a)(1)(i) of finalregulatory text.]

a. Background

As noted in the proposal, for areas initially classified moderate andhigher 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 inthe same year

as the attainment date formoderate
areas, viz., 1996.For areas classified moderate and higher under the 8-hour

ozone standard, however, we proposed that the 15 percent RFP targetlevel of emissions would be calculated forthe 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 ofnonattainment areas is

- June 15, 2004, the outside statutory attainment date would beJune 15, 2010. This leaves approximately a 11/2 year gap between the end ofthe 6-year period for the 15 percent RFP requirement (i.e., December 31, 2008) and the maximum statutory attainment

41We note that even though thedraft regulatory
text was structured to place the specification ofthe baseline year for RFP (as well as for attainment demonstrations) in § 51.909, the final rule places the RFPbaseline year requirement in § 51.910.

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date. Ifwe were to also require moderate

areas to obtain an additional three percent peryear emission reduction beyond 2008 for the 11/2 additional years out to 2010, the RFPrequirement 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 formoderate areas is the 15 percent VOC requirement between the end of2002 and the end of2008. However, section 172(c)(2), which requires areas to meet RFP generally, would apply for any period for which RFP is notaddressed in subpart 2.For purposes ofsection 172(c)(2), RFP

means annual incremental reductions as may be required bythe Administrator for purposes ofensuring attainment [CAA Section 171(1)]. Therefore, we proposed a moderate area would needto provide any additional emissions reductions-VOC and/or NOx-needed
to jrovide forattainment by the area's attainment date. Inproposing this approach forthis circumstance, we interpreted the subpart 1 RFP requirement to mean that the area must achieve whateveifurther reduction is needed forattainment in the remaining period prior to the attainment date (2009through June 15, 2010).

We proposed that serious and higher classified areas would needto provide intheir SIPs an additional average of three percent peryear emission reduction over each subsequent 3-year periodbeyond the initial 6-year period through the attainment year, consistent with what Congress specified in section 182(c)(2)(B) ofthe CAA.

b. Summary ofFinal Rule

Inthe final rule, we are taking the approach we proposed. We are not prescribing additional increments of reductions forthe 11/2 years before the maximum attainment date for moderate

areas. Such areas must provide for any additional emissions reductions (VOC/ NOx)-neededto provide forattainment by the beginning ofthe 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 ofthree percent per year emission reduction overeach subsequent 3-year period beyond the

42We note that areasmust implement controls prior to thebeginning ofthe last full ozone season preceding the attainment date. Formoderate areas designated as ofJune 15, 2004, suchreductions would be needed by thebeginning ofthe2009

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 ofhow to handle the "11/2 year gap between the .endofthe 6-year -periodfor 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 notbelieve the'CAA requires the end ofthe 15 percent RFPperiod and the attainment date to be the

same. .

Comment:Another commenter noted the proposal states that the only specific RFPrequirement applicable for moderate areas is the 15 percent VOC requirement between the end of2002 andthe end of2008. However, section 172(c)(2) also applies, requiring areas to meetRFP generally. Therefore, a moderate area would still also have to provide any additional emissions reductions-VOC and/or NOx, i.e., whatever is needed toprovide for attainment by thebeginning ofthe

ozone season prior to the area's attainment date.The commenter agrees that any additional emissions reductions needed to achieve attainment

are the onlyreductions that shouldbe required of moderate areas.

Response:We agree with the commenter, and our rulerequires that for-purposes ofmeeting RFP beyond 2008 until the area's attainment date, moderate areas mustreduce VOC and NOx emissions as necessary to attainby the area's attainment date.
5. What is the timing ofthe submission ofthe RFP plan?

[Section VI.I.6 ofJune 2,2003 proposed rule (68FR 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 1Rule, forpurposes ofattainment dates forthe 8-hourNAAQS, we interpreted the CAA's language referring
to the date ofenactment ofthe 1990 CAA Amendments to mean the date of designations forthe 8-hour standard. We noted in the proposal that ifwe applied the same interpretation forRFP plans,i.e.; that they shouldbe submitted within 3years after the area's nonattainment designation date (i.e., in 2007 ifthe area has an effective designation in 2004), the plans would have to be implemented within 1year after submission to ensure the 15 percent emissions reductions are achieved by the end ofthe relevant 6- yearperiod (i.e., December 2008). We indicated concern that this might not provide sources with sufficient timeto 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/orNOx)

overthe first 6'years from the baseline year and then submit within 3years after designation a RFP plan that provides nine percent emissions reductions (VOC and/or NOx) over each ofthe next 3-year periods until the area's attainment date.

b. Summary ofFinal 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 statedthat they would need morethan 2 years for development, adoption and submission ofRFP plans for the increment ofprogress over the first 6 years after the baseline year. The EPA agrees with the several commenters who urged that 3 years was more consistent withthe CAA. Additionally, 3 years is

amore 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 inconjunction with their attainment demonstrations. Therefore, for moderate and higher classified areas, the firstRFP SIPmust be submitted within 3 years after the area's nonattainment designation. Forareas with aJune 15, 2004 effective date for the 8-hour designations, the SIPwould 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 (untilthe end of2008) for control measures to be implemented. The RFP SIP for any remaining 3-year periods outto the attainment date beyond the first 6 years also would be submitted with the attainment demonstration, i.e., within 3years after designation. However, since States maintain the flexibility to submit plans early to provide more time for , implementation oftheir 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 submissionto 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 claimthis proposal violates the guarantee of3 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 willbe due as ageneral matter by the same period oftime after designation and classification under the 8-hour standard asprovided in subpart 2 for areas designated and classified at the time of enactment ofthe 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 ofthe RFP plan, another commenter was concerned that the States may nothave sufficient photochemical modeling and ambient air analyses to indicate the best mix ofRFP 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 asEPA has suggested. The commenter suggested that EPA develop policy options that allow areas in such predicaments to maintain approved SIPsif emissions reductions are not available to meet RFP requirements and/or ifavailable emission reduction techniques mightbe counterproductive to other local and regional air quality goals.

Another commenter stated revisions -to State emission reduction measures cannotbe 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 aregulation by administrative action with public input before (though sometimes after) such ameasure is approved by the state's legislature. A number ofjurisdictions' legislatures are only in regular session to consider such measureg several months or, in alternate years. Thus, it is unreasonable forStates to have only 2years from their nonattainment designations to6 adopt

new-measures.

Another commenter referenced the

case NRDCv. EPA, 22 F. 3d 1125, 1135 (D.C. Cir., 1994), where the Court considered the propriety ofEPA's extension ofthe deadlines by which States had to submit elements oftheir SIPs. The Court upheld EPA's decision
to extend the deadline for submission of

a SIPgiven 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 ofa 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 acompliance deadline "as expeditiously as possible,but in no case laterthan 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 SIPbe submitted 3 years after designation. The commenter disagreed with the RFP plan requirement to submit the plan 2years after the effective date ofthe nonattainment designation as notbeing 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 notrequire this SIP revision sooner than the submission of the attainment demonstration, 3years after the effective date ofthe designations. Allowing States 3 years to submit the RFP plan is consistent with existing CAArequirements.

.

Response:After consideration ofthe comments, we have changed the final rule to be consistent with the approach advocated by anumber ofcommenters. 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 3years after designation to submit their RFP SIPs. However, to the extent States are relying onnewly developed rules to meet all or part ofthe RFP requirement,

werecommend 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 CAArestrictions on creditable measures be interpreted? Which national measures should count

as generating emissions reductions credittoward RFP requirements?

[Section VI.I.7 ofJune 2, 2003 proposed rule (68 FR 32834); §51.910(a)(4) of the draft regulatory text; §51.910(a)(3) ofthe finalregulatory text.]

a. Background

Section 182(b)(1) contains provisions that limit creditability toward meeting RFP forcertain limited emission reduction measures required prior to the
enactment ofthe CAA Amendments of 1990. We noted in the proposal that we believe these specific restrictions should continue to apply for purposes ofthe 8- hour NAAQS. The proposal noted that Congress intended to prevent areas from taking credit forRFP only for those specific measures that were already adopted and in place (or required to be inplace) prior to the date ofenactment ofthe 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 RFPpercent reductions for continuing reductions from those specific measures cited in the CAA that were already adopted and inplace (or required to be adopted and in place) prior to the date of enactment ofthe CAA Amendments of 1990. There isno indication in the CAA thatthis exclusion should be changed. Congress mandated many emissions reductions in the 1990 CAAAmendments with no indication that they should notbe * credited to meeting RFP or attainment of any existing orrevised NAAQS. Therefore, we proposed that all

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emissions reductions that occurfrom 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 forthe RFP requirement. Anumber ofexamples demonstrating emissions reductions that would be creditable toward theRFP requirement were set forthin our proposal.

b. Summary ofFinal Rule
We are taking the approach 'we proposed, under which all emissions reductions that occur after the baseline emissions inventory year are creditable forpurposes ofthe RFP requirements in this section except as specifically provided in section 182(b)(1)(C) and (D) and section 182(c)(2)(B) ofthe CAA. The restriction imposed by section 182(b)(1)(D) limits crediting reductions from the following four categories:

* Corrections to or additions ofRACT rules as required by CAA section 182(a)(2)(A)..

* Corrections to I/M programs for

areas where the SIP included orwas required to include' a schedule forI/M implementation under the CAA in effect immediately before November 15, 1990. * Regulations concerning Reid Vapor Pressure (RVP)promulgated byEPA before November 15, 1990 orrequired to be promulgated under CAA secti6n 211(h).

o Motor vehicle exhaust or evaporative emissions'measures promulgated by EPA byJanuary 1, 1990.

c. Conunents and Responses
Comment:One commenter supported EPA's proposal to allow credit towards RFP requirements ofall 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 SIPcontrols and VOC reductions from implementation ofMACT standards after the baseline year. The commenter stafed that.this proposed approach would be critical in a number ofareas that already have stringent stationary

source controls and/or in areas 'dominated by mobile source emissions.

Response:The EPA acknowledges this comment ofsupport for our final action.

Comment:Anothercommenter believedthat 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 forRFP 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 .asthey 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 creditfor these reductions provides disincentives for voluntary reductions.

Response:Voluntary reductions that

occur prior to January 1, 2003 will be reflected inthe area's baseline inventory. This lower baseline means that fewer reductions willbe needed to achieve RFP.43 Allowing an areato take credit for reducing emissions that are not included inthe inventory would result in "double counting" ofthose emissions reductions.' Comment:One commenter suggested that areas should be ableto 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 ifEPA produced a document detailing the expected VOC reductions after implementation ofMACT 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 forpost2002 VOC reductions from MACT standards. We are considering whether
to develop therecommended 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 ofmeasures 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, ifan areahad VOC emissions in 2001 of100 tons per day, anda source reduces emissions by 10 tons per day in 2002, thebaseline emissions will be 90 tons per day.Thus, the area will need to achieve 13.5tons 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 ofemissions that are not part ofthe 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 ahybrid 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 forongoing 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 ofCAA 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 notbe credited toward the new RFP requirements. For example, reductions that wererequired 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)), anyreductions thatoccur after 2002 are creditable towards RFP and attainment and that it should not matter when the State initially adopted orEPA promulgated the measures that produce those reductions. The CAA does not mandate the approaches advocated in the
comments. While the comments cite phrases inthe CAA that might be read
to support the approach advocated in the comments, EPA believes such an interpretation is at odds with other provisions ofthe CAA. In addition to the restriction imposedby 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 ifthey result from measures in the applicable implementation plan, i.e., the approved 71641

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SIP orfrom 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 RFPmilestone. The requirement that the reductions result from measures in the applicable implementation plan or EPA regulations, or applicable requirements contained in atitle V operating permit imposes no restriction that such measures must be enacted after the date ofdesignation orafter the baseline year.This restriction only requires that the measure approved into the SIP be arule promulgated by EPA

orbe 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 thebaseline 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 ofthe three aforementioned classes ofmeasures, EPA does not see anything in the statute that mandates the adoption ofthe approach advocated in the comments. In fact, EPA believes the opposite is the

case.

The same argument (i.e., that creditable RFP measures mustbe

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 theTier 1 motorvehicle standards under title II. The EPA believes the statute is plain that Congress envisioned that all 6fthese would be adopted after 1990 and inmost cases implemented before 1996 because the statute contains enforceable deadlines for submission of the requisite SIP revisions or promulgation ofthe EPA rules. In many cases, they contain required implementation datesbefore 1996. Congress clearly did not limit credit for RFP forany ofthese measures. In our proposed rulemaking, EPA specifically proposed allowing use ofreductions resulting from.any measure as long as th6 reductions meet the creditability criteria ofsection 182(b)(1)(C) for the

44Applicable 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 intendto impose the sortof limit on creditability advocated-in the
comments forthe 1-hour standard and for anyrevised standard.

In summary, the statute says that only four specific categories ofemissions reductions are restricted. It does not refer to or include any post-1990 rules' emissions reductions as restricted and only speaks to creditability interms of when the reductions occurred, notwhen the rules ormeasures were adopted. As explained in the proposal and the preceding paragraphs, Congress had

reason to limit creditability ofpre-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 foremissions 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 ofthe 1990 CAAAmendments 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. ofJune 2,2003 proposed rule (68 FR 32834); § 51.910(b) ofthe draft and final regulatory text.]

a. Background

The proposal noted that the RFP requirement under subpart 1is more general than that under subpart 2, and EPA thushas more flexibility in determining what RFP means under subpart 1.For instance, the State may rely on emissions reductions ofVOC or NOx, or a combination ofboth to meet its RFP requirement whereas subpart 2 limitsthe initial 15 percent to VOC emissions reductions. However, we acknowledged the concern about treating in a similar manner areas under subpart 1that have an ozone problem similarto areas covered under subpart 2. We proposed scenarios forthree types ofsubpart 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. * Areaswith attainmentdates3years

orless afterdesignation.

We proposed these areas would be treated similarto areas under subpart 2 that are classified as marginal, which do
not have an RFP requirement. We proposed such an area Wvould notbe, subject to a separate RFP requirement, but RFP would be met by demonstrating the area could attain the standard by its attainment date.

e AreasWith attainment dates between 3 to 6yearsafterdesignation.

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 ofthe nonattainment area and RFP would be
metby-a SIPthat provides for attainment as expeditiously as practicable. Where areas have only 3 years after SIP submission before attainment, this optionrecognizes that there may be only ashort amount of. time available to achieve any specified emissions reductions to meet RFP. The draft regulatory text incorporated this option.

# Option2.This option would require these areas to be treated in a
manner similarto 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 2years 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 3years after designation.

* Areaswith attainmentdatesbeyond 6yearsafterdesignation.

These areas would have attainment dates similarto areas classified under subpart 2 as serious or higher. We proposed that the RFP plan show increments ofprogress from the baseline emissions inventory year outto the attainment date. The RFP SIPwould

45NOx Substitution Guidance. December 15, 1993 (available athttp://www.epo.gov/ttn/oarpgl tIpgm.html).

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firsthave to provide for a 15 percent emission reductiofi from the baseline
year within 6 years after thebaseline year. The 15 percent RFP SIPwould have tobe submitted within 2years after designation. However, since the

area is subject only to subpart 1, NOx emissions reductions could be substituted for some orall ofthe 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 outto the attainment date, another RFP SIP Would haveto provide foran additional increment ofprogress no less than the
amount ofemissions 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

sametime as the attainment demonstration, namely within 3years 

### after designation.

b. Summary ofFinal Rule

We are finalizingrules fortwo, rather than three, categories ofareas based on the CAA's division ofattainment dates for subpart 1 areas under section 172(a)(2). This provision requires that subpart 1 areas must attain as expeditiously aspracticable but no later than 5 years after designation as a nonattainment area. It also allows the Administrator to extend the attainment date beyond that 5year period "" * * for a period no greater than 10years from the date of designation as nonattainment, considering the severity ofnonattainment and the availability and feasibility ofpollution 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
orbefore June 15, 2009 forareas designated June 15, 2004).

As noted elsewhere in'this preamble, forareas classified under subpart 1, emissions reductions needed for attainment mustoccur 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 bythe beginning of the 2008 ozone season. The finalrule provides that RFP for these areas would be metby ensuring emissions reductions needed forattainment are implemented as noted aboveby the beginning ofthe ozone season prior to the attainment date. Scenario B: Areas with attainment dates

more than 5years after designation (i.e., beyond June 15, 2009 forthose areas designated June 15, 2004). For these

areas:

* The RFP plan must show increments ofprogress from thebaseline emissions inventory year out to the attainment date.

* The RFPSIP would first have to provide for a 15 perceht einission reduction from the baseline year through the 6th year after thebaseline
year (e.g., from January 1,2003 through December 31, 2008).

* The 15 percent RFP SIP mustbe submitted within 3 years after designation (e.g., by June 15, 2007).

* However, since the area is subject only to subpart 1,NOx orVOC emissions reductions (orboth) could be used to achieve the 15 percent emission reduction requirement.

* For each subsequent 3-year period
outto the attainment date, the RFP SIP would have to provide for an additional increment ofprogress. The increment foreach 3-year period would be a portion ofthe remaining emission reductions needed for attainment beyond those reductions achieved for the first increment ofprogress (e.g., beyond 2008 for areas designated nonattainment inJune 2004). Specifically, the amount ofreductions needed for attaihment should be divided by the number ofyears needed for attainment after the first increment ofprogress in order to establish an "annual increment." For each 3-year period outto the attainment date, the

area must achieve roughly the portion of reductions equivalent to three annual increments. 46 This second RFP SIP must

46For example, ifthe area's attainment date is 2014, and a total of30 percent reduction is needed between the end of2008 and theattainment date (a6-year period) to reach attainment, the "annual increment" would be 5 percent (i.e., 1/6 of30 percent). Thus, the areamust achieve roughly the portion ofreductions equivalent to 15 percent (3 x 5 percent) during the first 3 years (2009, 2010, 2011), and theremaining amount over the next 3 years (2012, 2013, 2014). By using theword "roughly" in the regulatory text, EPA doesnot intend that States would be able todelay substantial
emission reductions from one 3-year period tothe next. Rather, EPAintends this modifier to allow small deviations fromthe amount ofemission reductions that would be needed to meet a 3-year
RFPrequirement. For example, assume that the "annual increment" ofreductions 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 ofthe two 3-year periods intil attainment, the area would need "roughly" 15 tons per day, solong as the total forboth periods is equivalent to or greater than 30 tons per day (i.e., thetotal reductions needed for attainment). Assuming the area could also be submitted within 3years after the effective date ofdesignation (i.e., byJune 15, 2007).

While the adopted rule is not identical to any ofthe 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 ofthe three proposed scenarios, we believe it is similarin result to the three scenarios proposed.

c. Comments and Responses
Comment:One commenter stated that EPA has no authority to adopt "Option 1" forareas with attainment dates between 3 and 6 years after designation, because that option would waive any showing ofRFP.

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 1areas. We are not requiring any specific percent reduction for sibpart 1 areas with nearterm attainment dates. The measures that bring aboutnear-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 forall subpart 1 areas, especially in those cases where a full 15 percent is
notneeded in orderto 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 of3years orless 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 1areas 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 duringthe second 3-year period, webelieve this wouldbe consistent with achieving "roughly the portion ofreductions equivalent to three annual increments." We do notbelieve, however, that use oftheword roughly allows States to delay substantial emissionreductions. Thus,in the example above, itwould notbe appropriate forthe State to delay reductions ofseveral 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. IResponse:We acknowledge the support ofthese 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 1requires thatthe 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 nobasis under subpart 1,
to require such specific emissions reductions. They further saidthat requiring a potentially expensive reduction in emissions in those cases where that reduction would not improve air quality was notjustified based on anotion 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 ofthe Congress' decision to limit EPA's discretion under subpart 2-which inturn is a resultof

a far less sophisticated understanding of the dynamics ofozone 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 ofsubpart 2 (whichincludes 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, oris 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 ofa
measure would produce an absurd result. 8. Where Part ofan 8-hour Nonattainment AreaWas a 1-hour Nonattainment AreaWith aROP 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. ofJune 2, 2003 proposed rule (68FR 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 forthe post-2002 period, the State may rely on emissions reductions from the 1- hour plan inachieving RFP forthe 8- hour standard. The State could develop

anew baseline andnew RFP emission reduction targets forthe entire 8-hour standard nonattainment area (i.e., the old 1-hour standard nonattainment area and any newly added portion ofthe 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 aRFP target forthe 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 ofFinal Rule

We are adopting the approach from the proposal.

c. Comments and Responses
Comment:One commenter agreed with the approach outlined in the proposal butcautioned that the States would have to ensure that the target is at least as stringent asthe 1-hour ROP target, thus ensuring nobacksliding on the 1-hour NAAQS requirements. Under this approach, the State would have to develop anew baseline and new RFP emission reduction targets forthe 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 inthe proposed rulemaking) toward meeting the RFP requirement forthe entire 8-hour area. The new RFP target forthe 8-hour standard would replace the previous 1- hour ozone target (while ensuring that,
at aminimum, 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 asthe 1-hour targets. Section IV.E.3. ofthispreamble discusses the requirements forRFP 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 ofan area under the antibacksliding provisions of40 CFR 51.905(a)(1)(iii) would still apply, meaning that emissions reductions under the 1-hour ROP requirements would still be required as ifthe 1-hour standard had never been revoked. Therefore, the new 8-hour emission target forthe 8-hour area would be " logically at least as stringent as under the 1-hour area fora given time period.

9. WillEPA's "Clean Data Policy" Apply forPurposes of8-hour RFP, Attainment Demonstrations and Other Related Requirements? [Section VI.I.10 ofJune 2,2003 proposed rule (68 FR 32835); no draft regulatory text; section 51.918 offinal rule.]

a. Background

As noted in the proposal,.we issued

apolicy.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 ofareas that EPA determines have attained the 8-hour ozone NAAQS.

b. Summary ofFinal Rule

In the proposed rule, we indicated that the Clean DataPolicy, which we had applied under the 1-hour standard, should apply for purposes ofthe 8-hour standard. We are adoptingthis approach. Inthis action EPA is finalizing-the statutory interpretation that is embodied in the policy. The text ofthe final rule encapsulates the statutory interpretation set forth in the policy: Determinations as to whether individual areas have attained the 8-

47Memorandum ofMay 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 andthus qualify for application ofthe policy willbe made in the context ofrulemakings forthose 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 (69FR 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 boththe 1-hour and 8- hourNAAQS. 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 CAAunambiguously 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 ofthe "Clean Data Policy."

Response:The EPA believes thatthe Clean DataPolicy comports withthe provisions ofthe 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 forthEPA's interpretation that where EPA has determined that an area has attained the standard, cQrtain SIP requirements are suspended (e.g., RFP) forso-longas the area remains in attainment.

As setforth 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 notrequiring further submissions to achieve attainmentfor so long asthe

area is in fact attaining the standard. Under the policy, EPA is not granting an exemption from any applicable requirements under partD. Rather, EPA has interpreted these requirements of subparts 1 and 2 as not applying for so long asthe area remains in attainment with the standard. This is not a waiver ofrequirements that by their terms apply; it is a determination that certain requirements are written so asto be operative only ifthe area is not attaining the standard.

The EPA has explained in other rulemaking actions on the 1-hour ozone standard its rationale forthe reasonableness ofthis interpretation of the CAA and incorporates these explanations byreference. See, for example, 67 FR 49600 (July31, 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 (July20, 1995); 61 FR 31832-33 (June 21, 1996) (GrandRapids, 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 (April22, 2004) (San Francisco BayArea). The EPA has also set forthits legal rationale for the Clean Data Policyin briefs filed in the 10th, 7th, and 9th Circuits, and hereby incorporates thosebriefs insofar

as relevant here. See SierraClubv. EPA, No. 95-9541 (10th Cir.), SierraClubv. EPA, No. 03-2839, 03-3329 (7th Cir.), OurChildren's EarthFoundation v. EPA, No. 04-73032 (9th Circuit).

As stated inthe 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 meetthese 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 SierraClubv. EPA, 99 F. 3d 1551 (10th Circuit, 1996), SierraClubv. EPA, 375 F. 3d 537 (7th Circuit, 2004) and Our * Children's EarthFoundation 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, SierraClubv. 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 TruckingAssoc., 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 2prescribes large parts of nonattainment programs, for example, section 182. The requirements forRFP 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 Clubv.EPA, 293 F. 3d 155 (D.C. Circuit, 2002) (holdingthat EPA is without authority to. infer exceptions to attainment deadlines and to explicit subpart 2 requirements forRFP plans).

Response:The EPA believes that the Tenth Circuit correctly decided Sierra Clubv. EPA and that the comments misconstrue both Whitman andSierra Clubv. EPA, 293 F. 3d 155 (D.C. Circuit, 2002) (Sierra Club2002). The Sierra Club2002 case addressed the statutory requirements applicable to an area not attaining the standard. The issue of the requirements of part D oftitle I ofthe CAA that must continue to be metby

areas thatEPA has determined are monitoring attainment ofthe standard

was notbefore the court.As discussed below, the SierraClub2002decision 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 ofEPA's application ofthe Clean DataPolicy. To this limited extent, SierraClub2002is relevant to EPA's interpretation that the policy will apply forthe 8-hour ozone standard, and the decision supports EPA's interpretation. However, the other issues addressed inthe decision (extension ofthe statutory attainment date for areas affected by ozone transport, the content ofa demonstration ofRFP toward attainment, and whether contingency

measures mustbe submitted as part of

an attainment demonstration or plan for RFP) did not relateto the Clean Data Policy orhow the subpart 2 requirements apply to areas attaining the standard..

The issue-addressedby the Clean Data Policy is whether aii area that has attained the standard (as evincedby air quality monitoring data) stillneeds to submit a demonstration ofhow the area will achieve enough reductions to demonstrate that it will "attain the NAAQS," aplan to obtain reasonable periodic reductions towards the goal of attainment and other related requirements.

The EPA continues to believe that the statutory requirement foran attainment demonstration-a SIP revision which identifies the level offuture reductions needed to achieve the NAAQS and any additional .adoptedmeasures needed to achieve these future reductions-is written so as to be inapplicable once the NAAQS is attained.

In addition, EPAbelieves 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 forthe samereason the attainment demonstration no longer 

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applies by its own terms, RACM also no longer applies. TheEPA 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 forRFP-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 formeasures to meet that goal. Similarly, EPA continues tobelieve that the contingency measure requirements ofsection 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 nolonger applies once

an area has attained the standard.

Section 172(c)(2) ofthe CAA and the related provisions ofsubpart 2 provide that RFP is required 'onlywhere 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 bythe attainment date. Ifan area has attained the standard, the stated purpose ofthe RFP provision hasbeen fulfilled. Also, section 172(c)(1) andthe related provisions ofsubpart 2require SIPS to provide forattainment ofthe 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 aplan demonstrating how it willreach 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 innonattainment

48[The EPA's interpretation that thestatute requires only implementation ofRACM measures that would advance attainment was upheld by the United States Court ofAppeals for theFifth Circuit (SierraClubv. EPA, 314 F. 3d 735, 743-745, 5th Cir. 2002) and'by the United States Court of Appeals for theD.C. Circuit (SierraClub v.EPA,
294 F. 3d 155, 162-163, D.C. Cir. 2002). See also thefinal rulemakings forPittsburgh-Beaver Valley. Pennsylvania, 66 FR 53096 (October 19, 2001) and St. Louis, 68 FR 25418 (May 12, 2003).] -areas shallprovide for contingency

measures to be findertaken ifthe area fails to make RFP orto attain the NAAQS by the applicable attainment date. Since contingency measures are required only ifRFP or attainment is not achieved, there is noneed forthem where the area has attained the standard. The language-ofthese statutory provisions indicates that when

an area has attained the standard these requirements no longer apply as the purpose ofthese provisionsattainment-has been accomplished.

TheEPA believes that Whitmandoes
notprovide 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 1rule, 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 aspecific situation where an area has attained the NAAQS. That issuewas not addressed by the Court in Whitman.The decision in Whitmanhas nobearing on the question ofwhether an area that has demonstrated attainment must nonetheless submit an attainment demonstration plan and related requirements. Thus, Whitmandoes not underline the Tenth Circuit'sreasoning inSierraClubv. EPA, 99 F. 3d 1551 

### (10th Circuit, 1996). See,also the postWhitman decisions in SierraClubv. EPA, 375 F. 3d 537 (7th Circuit, 2004), and OurChildren's.Earth Foundationv. EPA, No. 04-73032, memorandum opinion (9th Circuit, June 28, 2005) rejecting challenges to the Clean Data Policy and upholding redesignation actionsbased on the policy.

10. How will RFP be addressed inTribal
areas?

. [Section VI.I.11. ofJune 2,2003 proposed rule (68 FR 32835); no draft or final regulatory text.]

a. Background

.

The TAR provides flexibility for Tribes inthe preparation ofa TIPto 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 inIndian coultry. It further provides the Tribes with flexibility to develop these plans in a modular way,

as long asthe elements oftheir 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, andthe capacity and resources to implement the program it adopts. Therefore, it may include one or two source-specific requirements butmay not include provisions for RFP and other SIPrequirements. 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 alater time.

b. Summary ofPolicy

We intendto 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 ofthe proposal.
11. How will RFP targets be calculated?



### [Section VI.1.12. ofJune 2,2003 proposed rule (68 FR 32836); § 51.910(c) ofthe draft and final regulatory text.]

a. Background

We proposed a methodology forthe calculation ofRFP target levels of emissions that is based onthe method

we developed for the 1-hour standard, while taking into account our' interpretation ofCAA 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 ofmeasures that were notcreditable 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 VaporPressure (RVP) promulgated after 1990 orrequired under section 211(h).

(3)Measures required under section 182(a)(2)(A) to correct deficiencies in SIPsregarding VOC RACT regulations required prior to enactment ofthe CAA Amendments of 1990.

(4) State regulations submitted to correct deficiencies inI/M existing or required programs.

These four types ofmeasures were all expected to result in a decrease in emissions between 1990 and 1996. Of thesefour types ofmeasures, RACT and I/Mprogram 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.

HeinOnline -- 70 Fed. Reg. 71646 2005