```

[Federal Register Volume 79, Number 100 (Friday, May 23, 2014)]
[Proposed Rules]
[Pages 29705-29712]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2014-11511]

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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[EPA-R09-OAR-2013-0823; FRL-9911-04-Region 9]

Approval of Air Quality Implementation Plan Revisions; State of 
California; South Coast VMT Emissions Offset Demonstrations

AGENCY: U.S. Environmental Protection Agency (EPA).

ACTION: Proposed rule.

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SUMMARY: The Environmental Protection Agency (EPA) is proposing to 
approve a state implementation plan (SIP) revision submitted by the 
State of California to meet the vehicle miles traveled emissions offset 
requirement under the Clean Air Act for the 1-hour ozone and 1997 8-
hour ozone national ambient air quality standards (NAAQS) in the Los 
Angeles-South Coast Air Basin. The EPA is proposing to approve this 
revision because it demonstrates that California has put in place 
specific enforceable transportation control strategies and 
transportation control measures to offset the growth in emissions from 
the growth in vehicle miles traveled and vehicle trips in the South 
Coast, and thereby meets the applicable requirements of the Clean Air 
Act. The EPA is taking comments on this proposal and plans to follow 
with a final action.

DATES: Any comments must be submitted by June 23, 2014.

ADDRESSES: Submit comments, identified by docket number EPA-R09-OAR-
2013-0823, by one of the following methods:
     Federal eRulemaking Portal: www.regulations.gov. Follow 
the on-line instructions.
     Email: ungvarsky.john@epa.gov.
     Mail or Deliver: John Ungvarsky, Air Planning Office (AIR-
2), U.S. Environmental Protection Agency Region IX, 75 Hawthorne 
Street, San Francisco, CA 94105.
    Instructions: All comments will be included in the public docket 
without change and may be made available online at www.regulations.gov, 
including any personal information provided, unless the comment 
includes Confidential Business Information (CBI) or other information 
whose disclosure is restricted by statute. Information that you 
consider CBI or otherwise protected should be clearly identified as 
such and should not be submitted through www.regulations.gov or email. 
The www.regulations.gov Web site is an ``anonymous access'' system, and 
the EPA will not know your identity or contact information unless you 
provide it in the body of your comment. If you send email directly to 
the EPA, your email address will be automatically captured and included 
as part of the public comment. If the EPA cannot read your comments due 
to technical difficulties and cannot contact you for clarification, the 
EPA may not be able to consider your comment.
    Docket: The index to the docket for this action is available 
electronically on the www.regulations.gov Web site and in hard copy at 
EPA Region IX, 75 Hawthorne Street, San Francisco, California, 94105. 
While all documents in the docket are listed in the index, some 
information may be publicly available only at the hard copy location 
(e.g., copyrighted material), and some may not be publicly available at 
either location (e.g., CBI). To inspect the hard copy materials, please 
schedule an appointment during normal business hours with the contact 
listed in the FOR FURTHER INFORMATION CONTACT section below.

FOR FURTHER INFORMATION CONTACT: John Ungvarsky, Air Planning Office 
(AIR-2), U.S. Environmental Protection Agency, Region IX, (415) 972-
3963, ungvarsky.john@epa.gov.

SUPPLEMENTARY INFORMATION: Throughout this document, ``we,'' ``us'' and 
``our'' refer to the EPA.

Table of Contents

I. Regulatory Background
    A. Ozone National Ambient Air Quality Standards
    B. South Coast Ozone Designations and Classifications
    C. Previous South Coast VMT Emissions Offset Demonstrations
II. Submittal of Revised South Coast VMT Emissions Offset 
Demonstrations
    A. 2012 South Coast AQMP and CARB's Technical Supplement
    B. CAA Procedural Requirements for Submittals of SIPs and SIP 
Revisions
III. Evaluation of Revised South Coast VMT Emissions Offset 
Demonstrations
    A. Section 182(d)(1)(A) and the EPA's August 2012 VMT Emissions 
Offset Demonstration Guidance
    B. Revised South Coast VMT Emissions Offset Demonstrations
IV. EPA's Proposed Action and Request for Public Comment
V. Statutory and Executive Order Reviews

I. Regulatory Background

A. Ozone National Ambient Air Quality Standards

    Ground-level ozone is formed when oxides of nitrogen 
(NOX) and volatile organic compounds (VOC) react in the 
presence of sunlight. These two pollutants, referred to as ozone 
precursors, are emitted by many types of pollution sources, including 
on- and off-road motor vehicles and engines, power plants and 
industrial facilities, and smaller area sources such as lawn and garden 
equipment and paints.
    Scientific evidence indicates that adverse public health effects 
occur following exposure to ozone, particularly in children and adults 
with lung disease. Breathing air containing ozone can reduce lung 
function and inflame airways, which can increase respiratory symptoms 
and aggravate asthma or other lung diseases. Ozone exposure also has 
been associated with increased susceptibility to respiratory 
infections, medication use, doctor visits, and emergency department 
visits and hospital admissions for individuals with lung disease. Ozone 
exposure also increases the risk of premature death from heart or lung 
disease. Children are at increased risk from exposure to ozone because 
their lungs are still developing and they are more likely to be active 
outdoors, which increases their exposure.
    In 1979, under section 109 of the Clean Air Act (CAA or Act), the 
EPA established primary and secondary national ambient air quality 
standards (NAAQS, standards, or standard) for ozone at 0.12 parts per 
million (ppm) averaged over a 1-hour period (referred to herein as the 
``1-hour ozone standard'' or ``1-hour ozone NAAQS''). See 44 FR 8202 
(February 8, 1979).
    In 1997, the EPA revised the ozone NAAQS to set the acceptable 
level of ozone in the ambient air at 0.08 ppm, averaged over an 8-hour 
period (referred to herein as the ``1997 8-hour ozone standard'' or 
``1997 8-hour ozone NAAQS''). See 62 FR 38856 (July 18, 1997). The EPA 
set the 8-hour ozone standard based on scientific evidence 
demonstrating that ozone causes adverse health effects at lower 
concentrations and over longer periods of time than was understood when 
the previous 1-hour ozone standard was set. The EPA determined that the 
8-hour ozone standard would be more protective of human health, 
especially children and adults who are active outdoors, and individuals 
with a pre-

[[Page 29706]]

existing respiratory disease, such as asthma.
    In 2008 (73 FR 16436, March 27, 2008), the EPA revised and further 
strengthened the primary and secondary NAAQS for ozone by setting the 
acceptable level of ozone in the ambient air at 0.075 ppm, averaged 
over an 8-hour period (``2008 8-hour ozone standard''). Today's 
proposed action relates only to the 1-hour and 1997 8-hour ozone 
standards and does not relate to the 2008 8-hour ozone standard.

B. South Coast Ozone Designations and Classifications

    Section 107 of the CAA requires the EPA to designate all areas of 
the country as nonattainment, attainment, or unclassifiable for each of 
the NAAQS, depending upon whether such areas experience violations of 
the NAAQS or contribute to violations in a nearby area. In the late 
1970s, the EPA designated the Los Angeles-South Coast Air Basin Area 
(South Coast) \1\ as nonattainment for the 1-hour ozone NAAQS. Under 
the 1990 CAA Amendments, ozone nonattainment areas were further 
classified, based on the severity of their nonattainment problem, as 
``Marginal'', ``Moderate,'' ``Serious,'' ``Severe,'' \2\ or 
``Extreme,'' and the South Coast was classified as ``Extreme'' 
nonattainment for the 1-hour ozone standard. See 56 FR 56694 (November 
6, 1991).
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    \1\ The South Coast includes Orange County, the southwestern 
two-thirds of Los Angeles County, southwestern San Bernardino 
County, and western Riverside County. The South Coast is home to 
approximately 17 million people, has a diverse economic base, and 
contains one of the highest-volume port areas in the world. For a 
precise description of the geographic boundaries of the South Coast, 
please see 40 CFR 81.305.
    \2\ In EPA's final rule to classify nonattainment areas for the 
1-hour ozone standard, Severe areas were classified as either 
Severe-15 or Severe-17 based on their design value. See 56 FR 56694 
(November 6, 1991).
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    In 2004, the EPA designated areas of the country with respect to 
the 1997 8-hour ozone standard, 69 FR 23858 (April 30, 2004), and the 
EPA designated the South Coast as ``Severe-17'' \3\ for the 1997 ozone 
standard, but later granted the State of California's request to 
reclassify the South Coast to ``Extreme'' for that standard. See 75 FR 
24409 (May 5, 2010).
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    \3\ In EPA's final rule to classify nonattainment areas for the 
1997 8-hour ozone standard, Severe areas were classified as either 
Severe-15 or Severe-17 based on their design value. See 69 FR 23858 
(April 30, 2004).
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C. Previous South Coast VMT Emissions Offset Demonstrations

    Once the EPA has promulgated a NAAQS, states are required to 
develop and submit plans that provide for the implementation, 
maintenance, and enforcement of the NAAQS under CAA section 110(a)(1). 
The content requirements for such plans, which are referred to as state 
implementation plans (SIPs) are found in CAA section 110(a)(2). The CAA 
further requires states with nonattainment areas to submit revisions to 
their SIPs that provide for, among other things, attainment of the 
relevant standard within certain prescribed periods.
    In California, as a general matter, the California Air Resources 
Board (CARB) is responsible for adoption and submittal to the EPA of 
California SIPs and California SIP revisions and is the primary State 
agency responsible for regulation of mobile sources. Local and regional 
air pollution control districts are responsible for developing regional 
air quality plans and for regulation of stationary sources. For the 
South Coast, the South Coast Air Quality Management District (SCAQMD or 
District) develops and adopts air quality management plans (AQMPs) to 
address CAA SIP planning requirements applicable to that region. 
Generally, such AQMPs are then submitted to CARB for adoption and 
submittal to the EPA as revisions to the California SIP.
    Under the CAA, as amended in 1990, the control requirements and 
date by which attainment of the 1-hour ozone standard was to be 
achieved varied with an area's classification. ``Extreme'' areas, such 
as the South Coast, were subject to the most stringent planning 
requirements but were provided the most time to attain the standard 
(i.e., until 2010). The various ozone planning requirements to which 
``Extreme'' ozone nonattainment areas were subject are set forth in 
section 172(c) and section 182(a)-(e) of the CAA.
    The specific ozone planning requirement that is relevant for the 
purposes of this action is CAA section 182(d)(1)(A), which, in relevant 
part, requires the state, if subject to its requirements, to ``submit a 
revision that identifies and adopts specific enforceable transportation 
control strategies and transportation control measures to offset any 
growth in emissions from growth in vehicle miles traveled or numbers of 
vehicle trips in such area.'' \4\ Herein, we use ``VMT'' to refer to 
vehicle miles traveled and refer to the related SIP requirement as the 
``VMT emissions offset requirement.'' In addition, we refer to the SIP 
revision intended to demonstrate compliance with the VMT emissions 
offset requirement as the ``VMT emissions offset demonstration.''
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    \4\ CAA section 182(d)(1)(A) includes three separate elements. 
Please see the related discussion in our proposed rule withdrawing 
our previous approvals of the South Coast VMT emissions offset 
demonstrations and disapproving the same at 77 FR 58067, at 58068 
(September 19, 2012). This proposed action relates only to the first 
element of CAA section 182(d)(1)(A) (i.e., the VMT emissions offset 
requirement).
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    As described above, in 1997, the EPA revised the ozone NAAQS and 
established the 1997 8-hour ozone NAAQS. Under the EPA's Phase I rules 
governing the transition from the 1-hour ozone standard to the 1997 8-
hour ozone standard, the EPA revoked the 1-hour ozone standard 
effective June 2005 but also established ``anti-backsliding'' 
provisions that, in effect, carried forward most of the SIP 
requirements that had applied to an area by virtue of its 1-hour ozone 
classification to areas designated as nonattainment for the 1997 8-hour 
ozone standard. See 69 FR 23951 (April 30, 2004); 40 CFR 51.905(a)(1); 
and 40 CFR 51.900(f). The VMT emission offset requirement is one of the 
requirements carried forward; thus, the South Coast, which is 
designated nonattainment for the 1997 8-hour ozone standard, remains 
subject to the VMT emissions offset requirement for the 1-hour ozone 
standard, notwithstanding the revocation of that standard in 2005. 
Moreover, the South Coast is also subject to the VMT emissions offset 
requirement for the 1997 8-hour ozone standard by virtue of its 
classification, initially as ``Severe-17'' and later as ``Extreme,'' 
for the 1997 ozone standard. See 69 FR 23858 (April 30, 2004); 70 FR 
71612 (November 29, 2005); 75 FR 24409 (May 5, 2010); and 40 CFR 
51.902(a).
    In 2008, to comply with the VMT emissions offset requirement for 
the 1-hour ozone standard, the SCAQMD submitted a demonstration showing 
decreases in aggregate year-over-year motor vehicle emissions in the 
South Coast from a base year (1990) through the applicable attainment 
year (2010).\5\ The following year, the EPA approved the South Coast 1-
hour ozone VMT emissions offset demonstration as meeting the VMT 
emissions offset requirement of CAA section 182(d)(1)(A). See 74 FR 
10176 (March 10, 2009). The EPA also approved the South Coast VMT 
emissions offset demonstration submitted in connection with the area's 
``Extreme'' classification for the 1997 8-hour ozone standard. See 77 
FR 12674 (March 1, 2012). Once again, the approved demonstration showed 
decreases in aggregate year-

[[Page 29707]]

over-year motor vehicle emissions in the South Coast from a base year 
through the applicable attainment year.\6\
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    \5\ Letter from Elaine Chang, Deputy Executive Officer, SCAQMD, 
dated September 10, 2008.
    \6\ See the SCAQMD's Final 2007 Air Quality Management Plan 
(June 2007) for the South Coast Air Basin, chapter 6, table 6-12.
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    In approving the South Coast VMT emissions offset demonstrations in 
2009 and 2012, the EPA applied its then-longstanding interpretation of 
the VMT emissions offset requirement, first explained in guidance in 
the General Preamble to Title I of the Clean Air Act (see 57 FR 13498, 
at 13521-13523, April 16, 1992), that no transportation control 
measures are necessary if aggregate motor vehicle emissions are 
projected to decline each year from the base year of the plan to the 
attainment year. See 74 FR 10176, at 10179-10180 (March 10, 2009); 76 
FR 57872, at 57889 (September 16, 2011). However, in response to a 
legal challenge brought in the U.S. Court of Appeals for the Ninth 
Circuit, the Court ruled against the EPA's approval of the South Coast 
VMT emissions offset demonstration for the 1-hour ozone standard, 
determining that the EPA incorrectly interpreted the statutory phrase 
``growth in emissions'' in section 182(d)(1)(A) as meaning a growth in 
``aggregate motor vehicle emissions'' versus a growth solely from VMT. 
Essentially, the Court ruled that additional transportation control 
measures are required whenever vehicle emissions are projected to be 
higher than they would have been had VMT not increased, even when 
aggregate vehicle emissions are actually decreasing. However, the Court 
acknowledged that ``clean car technology'' advances could result in 
there being no increase in emissions even in the face of VMT growth, 
which would then allow VMT to increase without triggering the 
requirement to adopt offsetting transportation control measures. 
Association of Irritated Residents v. EPA, 632 F.3d. 584, at 596-597 
(9th cir. 2011), reprinted as amended on January 27, 2012, 686 F.3d 
668, further amended February 13, 2012.
    Based on this reasoning, the Court remanded the approval of the 
South Coast VMT emissions offset demonstration for the 1-hour ozone 
standard back to the EPA for further proceedings consistent with the 
opinion. In response, we withdrew our approval of the South Coast VMT 
emissions offset demonstration for the 1-hour ozone standard and 
disapproved it. See 78 FR 18849 (March 28, 2013). Furthermore, because 
our approval of the South Coast VMT emissions offset demonstration for 
the 1997 8-hour ozone standard was predicated on the same rationale as 
the corresponding South Coast demonstration for the 1-hour ozone 
standard that was rejected by the Ninth Circuit, we withdrew our 
approval of the South Coast VMT emissions offset demonstration for the 
1997 8-hour ozone standard and disapproved it as well. Id.
    Specifically, we withdrew our previous approvals of the VMT 
emissions offset demonstrations and disapproved the same because we 
found that the submitted VMT emissions offset demonstrations were not 
consistent with the Court's ruling on the requirements of section 
182(d)(1)(A) because they failed to identify, compared to a baseline 
assuming no VMT growth, the level of ``increased'' emissions, within 
the overall set of declining aggregate motor vehicle emissions, 
resulting solely from VMT growth and to show how such relatively higher 
emissions, compared to what they would have been had VMT held constant, 
have been offset through adoption and implementation of transportation 
control strategies and transportation control measures. See 77 FR 
58067, at 58070 (September 19, 2012).\7\
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    \7\ For a more detailed discussion of the regulatory and SIP 
submittal history of the South Coast Air Basin 1-hour and 8-hour 
nonattainment areas with respect to the VMT emissions offset 
requirement under CAA section 182(d)(1)(A), the South Coast VMT 
emissions offset demonstrations, the related EPA actions, and the 
ensuing litigation and Court decision, please see our rule proposing 
to disapprove our previous approvals of the South Coast emissions 
offset demonstrations and disapproval of the same at 77 FR 58067, at 
58068-58070 (September 19, 2012).
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II. Submittal of Revised South Coast VMT Emissions Offset 
Demonstrations

A. 2012 South Coast AQMP and CARB's Technical Supplement

    As described above, in March 2013, the EPA finalized the withdrawal 
of its previous approvals of SIP revisions submitted by the State of 
California to meet the VMT emissions offset requirement under the CAA 
for the South Coast 1-hour and 1997 8-hour ozone nonattainment areas. 
See 78 FR 18849 (March 28, 2013). In response, CARB and the SCAQMD 
(``State'') prepared and adopted revised South Coast VMT emissions 
offset demonstrations to show compliance with the VMT emissions offset 
requirement under section 182(d)(1)(A) for the 1-hour and 1997 8-hour 
ozone standards consistent with the Court's opinion in the Association 
of Irritated Residents case discussed above.
    On February 13, 2013, CARB submitted, as a revision to the 
California SIP, the Final 2012 Air Quality Management Plan (December 
2012) (``2012 South Coast AQMP'') for the South Coast Air Basin (``2012 
South Coast AQMP''), adopted by SCAQMD on December 21, 2012 and by CARB 
on January 25, 2013.\8\ The revised South Coast VMT emissions offset 
demonstrations, which are the subject of today's proposed action, are 
included in the February 13, 2013 SIP revision submittal as appendix 
VIII, titled ``Vehicle Miles Traveled Emissions Offset Demonstration'' 
(February 2013), to the 2012 South Coast AQMP. In this document, we are 
proposing action only on the revised South Coast VMT emissions offset 
demonstrations contained in appendix VIII of the 2012 South Coast AQMP. 
The EPA will take action on the other portions of the 2012 South Coast 
AQMP, including the revised South Coast 1-hour ozone attainment 
demonstration found in appendix VII to 2012 South Coast AQMP, in 
separate rulemakings.
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    \8\ See CARB Resolution 13-3 (January 25, 2013) and letter from 
James N. Goldstene, Executive Officer, CARB, to Jared Blumenfeld, 
Regional Administrator, EPA Region 9, letter with enclosures 
(February 13, 2013).
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    The revised South Coast VMT emissions offset demonstrations address 
the requirement under CAA section 182(d)(1)(A) for a state with ozone 
nonattainment areas classified as ``Severe'' or ``Extreme'' to identify 
and adopt specific enforceable transportation control strategies and 
transportation control measures to offset any growth in emissions from 
growth in VMT or the numbers of vehicle trips. The demonstrations 
include analyses for the 1-hour ozone and 1997 8-hour ozone standards.
    On April 3, 2014, CARB submitted a technical supplement to the 
revised South Coast VMT emissions offset demonstration submitted on 
February 13, 2013 (``technical supplement''). See letter and enclosures 
from Lynn Terry, Deputy Executive Officer, CARB, to Deborah Jordan, 
Director, Air Division, EPA Region 9. CARB's technical supplement 
includes a revised set of motor vehicle emissions estimates reflecting 
technical changes to the inputs used to develop the original set of 
calculations.\9\ While the vehicle

[[Page 29708]]

emissions estimates in CARB's technical supplement differ from those 
contained in the demonstration as submitted on February 13, 2013, the 
conclusions of the analysis remain the same.
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    \9\ The principal difference between the two sets of 
calculations is that CARB's technical supplement includes running 
exhaust, start exhaust, hot soak, and running loss emissions of VOCs 
in all of the emissions scenarios. These processes are directly 
related to VMT and vehicle trips. The revised calculation excludes 
diurnal and resting loss emissions of VOCs from all of the emissions 
scenarios because such evaporative emissions are related to vehicle 
population rather than to VMT or vehicle trips.
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B. CAA Procedural Requirements for Submittals of SIPs and SIP Revisions

    CAA section 110(a)(1) and (2) and CAA section 110(l) require a 
state to provide reasonable public notice and opportunity for public 
hearing prior to the adoption and submission of a SIP or SIP revision. 
To meet this requirement, every SIP submittal should include evidence 
that adequate public notice was given and an opportunity for a public 
hearing was provided consistent with the EPA's implementing regulations 
in 40 CFR 51.102.
    CARB and the District have satisfied applicable statutory and 
regulatory requirements for reasonable public notice and hearing prior 
to adoption and submittal of the 2012 South Coast AQMP, which as noted 
above, included the revised South Coast VMT emissions offset 
demonstrations as appendix VIII to the plan. The District provided a 
public comment period and held a public hearing prior to the adoption 
of the 2012 South Coast AQMP on December 7, 2012.\10\ CARB provided the 
required public notice and opportunity for public comment prior to its 
January 25, 2013 public hearing on the plan.\11\
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    \10\ See SCAQMD Governing Board Resolution No. 12-19.
    \11\ See CARB Board Resolution No. 13-3.
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    The SIP submittal includes notices of the District and CARB public 
hearings as evidence that all hearings were properly noticed. We 
therefore find that the submittals meet the procedural requirements of 
CAA sections 110(a) and 110(l).

III. Evaluation of Revised South Coast VMT Emissions Offset 
Demonstrations

A. Section 182(d)(1)(A) and the EPA's August 2012 VMT Emissions Offset 
Demonstration Guidance

    As noted previously, the first element of CAA section 182(d)(1)(A) 
requires that areas classified as ``Severe'' or ``Extreme'' submit a 
SIP revision that identifies and adopts transportation control 
strategies and transportation control measures sufficient to offset any 
growth in emissions from growth in VMT or the number of vehicle trips. 
In response to the Court's decision in Association of Irritated 
Residents v. EPA, also discussed above, the EPA issued a memorandum 
titled Guidance on Implementing Clean Air Act Section 182(d)(1)(A): 
Transportation Control Measures and Transportation Control Strategies 
to Offset Growth in Emissions Due to Growth in Vehicle Miles Travelled 
(herein referred to as the ``August 2012 guidance'').\12\
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    \12\ Memorandum from Karl Simon, Director, Transportation and 
Climate Division, Office of Transportation and Air Quality, to Carl 
Edland, Director, Multimedia Planning and Permitting Division, EPA 
Region 6, and Deborah Jordan, Director, Air Division, EPA Region 9, 
August 30, 2012.
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    The August 2012 Guidance discusses the meaning of the terms, 
``transportation control strategies'' (TCSs) and ``transportation 
control measures'' (TCMs), and recommends that both TCSs and TCMs be 
included in the calculations made for the purpose of determining the 
degree to which any hypothetical growth in emissions due to growth in 
VMT should be offset. Generally, TCSs is a broad term that encompasses 
many types of controls including, for example, motor vehicle emission 
limitations, inspection and maintenance (I/M) programs, alternative 
fuel programs, other technology-based measures, and TCMs, that would 
fit within the regulatory definition of ``control strategy.'' See, 
e.g., 40 CFR 51.100(n). TCMs are defined at 40 CFR 51.100(r) as meaning 
``any measure that is directed toward reducing emissions of air 
pollutants from transportation sources. Such measures include, but are 
not limited to those listed in section 108(f) of the Clean Air Act[,]'' 
and generally refer to programs intended to reduce the VMT, the number 
of vehicle trips, or traffic congestion, such as programs for improved 
public transit, designation of certain lanes for passenger buses and 
high-occupancy vehicles (HOVs), trip reduction ordinances, and the 
like.
    The August 2012 guidance explains how states may demonstrate that 
the VMT emissions offset requirement is satisfied in conformance with 
the Court's ruling. States are recommended to estimate emissions for 
the nonattainment area's base year and the attainment year. One 
emission inventory is developed for the base year, and three different 
emissions inventory scenarios are developed for the attainment year. 
For the attainment year, the state would present three emissions 
estimates, two of which would represent hypothetical emissions 
scenarios that would provide the basis to identify the ``growth in 
emissions'' due solely to the growth in VMT, and one that would 
represent projected actual motor vehicle emissions after fully 
accounting for projected VMT growth and offsetting emissions reductions 
obtained by all creditable TCSs and TCMs. See the August 2012 guidance 
for specific details on how states might conduct the calculations.
    The base year on-road VOC emissions should be based on VMT in that 
year and it should reflect all enforceable TCSs and TCMs in place in 
the base year. This would include vehicle emissions standards, state 
and local control programs such as I/M programs or fuel rules, and any 
additional implemented TCSs and TCMs that were already required by or 
credited in the SIP as of that base year.
    The first of the emissions calculations for the attainment year 
would be based on the projected VMT and trips for that year, and assume 
that no new TCSs or TCMs beyond those already credited in the base year 
inventory have been put in place since the base year. This calculation 
demonstrates how emissions would hypothetically change if no new TCSs 
or TCMs were implemented, and VMT and trips were allowed to grow at the 
projected rate from the base year. This estimate would show the 
potential for an increase in emissions due solely to growth in VMT and 
trips. This represents a ``no action'' taken scenario. Emissions in the 
attainment year in this scenario may be lower than those in the base 
year due to the fleet that was on the road in the base year gradually 
being replaced through fleet turnover; however, provided VMT and/or 
numbers of vehicle trips will in fact increase by the attainment year, 
they would still likely be higher than they would have been assuming 
VMT had held constant.
    The second of the attainment year's emissions calculations would 
also assume that no new TCSs or TCMs beyond those already credited have 
been put in place since the base year, but would also assume that there 
was no growth in VMT and trips between the base year and attainment 
year. This estimate reflects the hypothetical emissions level that 
would have occurred if no further TCMs or TCSs had been put in place 
and if VMT and trip levels had held constant since the base year. Like 
the ``no action'' attainment year estimate described above, emissions 
in the attainment year may be lower than those in the base year due to 
the fleet that was on the road in the base year gradually being 
replaced by cleaner vehicles through fleet turnover, but in this case 
they would not be influenced by any growth in VMT or trips. This 
emissions estimate would reflect a ceiling on the attainment emissions 
that should be allowed to occur under the statute as interpreted by the 
Court because it shows what would happen under a scenario in which no 
offsetting TCSs or TCMs have yet been

[[Page 29709]]

put in place and VMT and trips are held constant during the period from 
the area's base year to its attainment year. This represents a ``VMT 
offset ceiling'' scenario. These two hypothetical status quo estimates 
are necessary steps in identifying the target level of emissions from 
which states would determine whether further TCMs or TCSs, beyond those 
that have been adopted and implemented in reality, would need to be 
adopted and implemented in order to fully offset any increase in 
emissions due solely to VMT and trips identified in the ``no action'' 
scenario.
    Finally, the state would present the emissions that are actually 
expected to occur in the area's attainment year after taking into 
account reductions from all enforceable TCSs and TCMs that in reality 
were put in place after the baseline year. This estimate would be based 
on the VMT and trip levels expected to occur in the attainment year 
(i.e., the VMT and trip levels from the first estimate) and all of the 
TCSs and TCMs expected to be in place and for which the SIP will take 
credit in the area's attainment year, including any TCMs and TCSs put 
in place since the base year. This represents the ``projected actual'' 
attainment year scenario. If this emissions estimate is less than or 
equal to the emissions ceiling that was established in the second of 
the attainment year calculations, the TCSs or TCMs for the attainment 
year would be sufficient to fully offset the identified hypothetical 
growth in emissions.
    If, instead, the estimated projected actual attainment year 
emissions are still greater than the ceiling which was established in 
the second of the attainment year emissions calculations, even after 
accounting for post-baseline year TCSs and TCMs, the state would need 
to adopt and implement additional TCSs or TCMs to further offset the 
growth in emissions and bring the actual emissions down to at least the 
``had VMT and trips held constant'' ceiling estimated in the second of 
the attainment year calculations, in order to meet the VMT offset 
requirement of section 182(d)(1)(A) as interpreted by the Court.

B. Revised South Coast VMT Emissions Offset Demonstrations

    For the revised South Coast VMT emissions offset demonstrations, 
the State used EMFAC2011, the latest EPA-approved motor vehicle 
emissions model for California.\13\ The EMFAC2011 model estimates the 
on-road emissions from two combustion processes (i.e., running exhaust 
and start exhaust) and four evaporative processes (i.e., hot soak, 
running losses, diurnal losses, and resting losses). The EMFAC2011 
model combines trip-based VMT data from the regional transportation 
planning agencies (i.e., Southern California Association of 
Governments), starts data based on household travel surveys, and 
vehicle population data from the California Department of Motor 
Vehicles. These sets of data are combined with corresponding emission 
rates to calculate emissions.
---------------------------------------------------------------------------

    \13\ See 78 FR 14533 (March 6, 2013) regarding the EPA's 
approval of the 2011 version of the California EMFAC model (short 
for EMissionFACtor) and announcement of its availability. The 
software and detailed information on the EMFAC vehicle emission 
model can be found on the following CARB Web site: http://www.arb.ca.gov/msei/msei.htm.
---------------------------------------------------------------------------

    Emissions from running exhaust, start exhaust, hot soak, and 
running losses are a function of how much a vehicle is driven. As such, 
emissions from these processes are directly related to VMT and vehicle 
trips, and the State included emissions from them in the calculations 
that provide the basis for the revised South Coast VMT emissions offset 
demonstrations. The State did not include emissions from resting loss 
and diurnal loss processes in the analysis because such emissions are 
related to vehicle population, not to VMT or vehicle trips, and thus 
are not part of ``any growth in emissions from growth in vehicle miles 
traveled or numbers of vehicle trips in such area'' (emphasis added) 
under CAA section 182(d)(1)(A).
    The revised South Coast VMT emissions offset demonstrations address 
both the 1-hour ozone standard and the 1997 8-hour ozone standard and 
include two different ``base year'' scenarios: 1990, for the purposes 
of the VMT emissions offset demonstration for the 1-hour ozone 
standard, and 2002, for the purposes of the VMT emissions offset 
demonstration for the 1997 8-hour ozone standard. The ``base year'' for 
VMT emissions offset demonstration purposes should generally be the 
same ``base year'' used for nonattainment planning purposes. In 2012, 
the EPA approved the 2002 base year inventory for the South Coast for 
the purposes of the 1997 8-hour ozone standard, 77 FR 12674, at 12693 
(March 1, 2012), and thus, the State's selection of 2002 as the base 
year for the revised South Coast VMT emissions offset demonstration for 
the 1997 8-hour ozone standard is appropriate. With respect to the 1-
hour ozone standard, the revised South Coast attainment demonstration, 
submitted to the EPA on February 13, 2013, relies on a base year of 
2008, rather than 1990; however, the State's selection of 1990 as the 
base year for the VMT offset demonstration is appropriate because 1990 
was used as the base year for 1-hour ozone SIP planning purposes under 
the CAA Amendments of 1990, which established, among other 
requirements, the VMT emissions offset requirement in section 
182(d)(1)(A).
    The demonstrations also include the previously described three 
different attainment year scenarios (i.e., no action, VMT offset 
ceiling, and projected actual) but the attainment year differs between 
the two demonstrations. Year 2022 was selected as the attainment year 
for the revised VMT emissions offset demonstration for the 1-hour ozone 
standard, and year 2023 was selected as the attainment year for the 
revised demonstration for the 1997 8-hour ozone standard. For the 1997 
8-hour ozone standard, the State's selection of 2023 is appropriate 
given that the approved South Coast 1997 8-hour ozone plan demonstrates 
attainment by the applicable attainment date of June 15, 2024 based on 
the 2023 controlled emissions inventory. See 76 FR 57872, at 57885 
(September 16, 2011) and 77 FR 12674, at 12693 (March 1, 2012).
    For the 1-hour ozone standard, in 2013, the EPA found the 
California SIP for the South Coast to be substantially inadequate to 
comply with the obligation to adopt and implement a plan providing for 
attainment of the 1-hour ozone standard. 78 FR 889 (January 7, 2013). 
Under this ``SIP call,'' effective February 6, 2013, the State was 
required to develop a revised South Coast plan demonstrating attainment 
of the 1-hour ozone standard as expeditiously as practicable, but no 
later than five years from the effective date of the SIP call, or, in 
this case, no later than February 6, 2018, unless the State can 
demonstrate that it needs up to an additional five years, i.e., up to 
February 6, 2023, to attain the standard in light of the severity of 
the nonattainment problem and the availability and feasibility of 
control measures.
    The revised South Coast 1-hour ozone attainment demonstration, 
which was submitted along with the revised VMT emissions offset 
demonstrations and the rest of the 2012 South Coast AQMP on February 
13, 2013, provides a justification for the full five years beyond the 
statutory five-year attainment date. The revised South Coast 1-hour 
ozone attainment demonstration thus provides a demonstration of 
attainment of the 1-hour ozone standard in the South Coast by 2023 
based on the controlled 2022 emissions inventory. In a separate 
rulemaking action published elsewhere

[[Page 29710]]

in today's Federal Register, EPA is proposing to approve 2022 as the 
attainment year for the 1-hour ozone standard in the South Coast.\14\ 
Based on the proposed approval of 2022 as the attainment year for the 
South Coast for the 1-hour ozone standard, we find CARB's selection of 
Year 2022 as the attainment year for the revised VMT emissions offset 
demonstration for the 1-hour ozone standard to be acceptable. For 
additional background and justification regarding the 2022 attainment 
year, please see the separate rulemaking action published elsewhere in 
today's Federal Register.
---------------------------------------------------------------------------

    \14\ In this context, ``attainment year'' refers to the ozone 
season immediately preceding a nonattainment area's attainment date. 
In the case of the South Coast for the 1-hour ozone standard, the 
proposed applicable attainment date is February 6, 2023, and the 
ozone season immediately preceding that date will occur in year 
2022.
---------------------------------------------------------------------------

    Tables 1 and 2 summarize the relevant distinguishing parameters for 
each of the emissions scenarios and show the State's corresponding VOC 
emissions estimates. Table 1 provides the parameters and emissions 
estimates for the revised VMT emissions offset demonstration for the 1-
hour ozone standard, and table 2 provides the corresponding values for 
the revised demonstration for the 1997 8-hour ozone standard.

             Table 1--VMT Emissions Offset Inventory Scenarios and Results for 1-Hour Ozone Standard
----------------------------------------------------------------------------------------------------------------
                                                       VMT                 Starts          Controls      VOC
                                             -------------------------------------------------------  emissions
                  Scenario                                                                          ------------
                                                 Year     1000/day     Year     1000/day     Year        tpd
----------------------------------------------------------------------------------------------------------------
Base Year...................................       1990    257,490       1990     46,060       1990          873
No Action...................................       2022    394,838       2022     72,531       1990          488
VMT Offset Ceiling..........................       1990    257,490       1990     46,060       1990          312
Projected Actual............................       2022    394,838       2022     72,531       2022           65
----------------------------------------------------------------------------------------------------------------
Source: CARB's Technical Supplement, April 3, 2014.

          Table 2--VMT Emissions Offset Inventory Scenarios and Results for 1997 8-Hour Ozone Standard
----------------------------------------------------------------------------------------------------------------
                                                       VMT                 Starts          Controls      VOC
                                             -------------------------------------------------------  emissions
                  Scenario                                                                          ------------
                                                 Year     1000/day     Year     1000/day     Year        tpd
----------------------------------------------------------------------------------------------------------------
Base Year...................................       2002    330,268       2002     58,039       2002          280
No Action...................................       2023    395,750       2023     72,730       2002          115
VMT Offset Ceiling..........................       2002    330,268       2002     58,039       2002           89
Projected Actual............................       2023    395,750       2023     72,730       2023           62
----------------------------------------------------------------------------------------------------------------
Source: CARB's Technical Supplement, April 3, 2014.

    For the two ``base year'' scenarios, the State ran the EMFAC2011 
model for the applicable base year (i.e., 1990 for the 1-hour ozone 
standard and 2002 for the 1997 8-hour ozone standard) using VMT and 
starts data corresponding to those years. As shown in tables 1 and 2, 
the State estimates South Coast VOC emissions at 873 tons per day (tpd) 
in 1990 and 280 tpd in 2002.
    For the two ``no action'' scenarios, the State first identified the 
on-road motor vehicle control programs (i.e., TCSs or TCMs) put in 
place since the base years and incorporated into EMFAC2011 and then ran 
EMFAC2011 with the VMT and starts data corresponding to the applicable 
attainment year (i.e., 2022 for the 1-hour ozone standard and 2023 for 
the 1997 8-hour ozone standard) without the emissions reductions from 
the on-road motor vehicle control programs put in place after the base 
year. Thus, the ``no action'' scenarios reflect the hypothetical VOC 
emissions that would occur in the attainment years in the South Coast 
if the State had not put in place any additional TCSs or TCMs after 
1990 (for the 1-hour ozone VMT emissions offset demonstration) or after 
2002 (for the 8-hour ozone demonstration). As shown in tables 1 and 2, 
the State estimates ``no action'' South Coast VOC emissions at 488 tons 
per day (tpd) in 2022 and 115 tpd in 2023. The principal difference 
between the two estimates is that the latter value (used for the 
revised VMT emissions offset demonstration for the 8-hour ozone 
standard) reflects the emissions reductions from TCSs and TCMs put in 
place by the end of 2002 whereas the former value (used for the revised 
demonstration for the 1-hour ozone standard) reflects only the 
emissions reductions from TCSs and TCMs put in place by the end of 
1990. The most significant of the measures adopted since 1990 and 
relied upon for the 1-hour ozone VMT emissions offset demonstration 
include tiered (series of increasingly stringent limits) emissions 
standards for new motor vehicles (i.e., Low Emissions Vehicles I, II, 
and III standards), content specifications for gasoline (i.e., 
California Reformulated Gasoline Phases 1, 2, and 3), and enhancements 
to the State's I/M program (i.e., Smog Check II). See attachments 1 and 
2 of Appendix VIII to the 2012 South Coast AQMP (i.e., the revised 
South Coast VMT emissions offset demonstrations) for the entire list of 
TCSs and TCMs adopted by the State since 1990.\15\
---------------------------------------------------------------------------

    \15\ The docket for today's action includes an updated list of 
the post-1990 transportation control strategies in attachment 1 of 
Appendix VIII to the South Coast AQMP.
---------------------------------------------------------------------------

    For the ``VMT offset ceiling'' scenarios, the State ran the 
EMFAC2011 model for the attainment years but with VMT and starts data 
corresponding to base year values. Like the ``no action'' scenarios, 
the EMFAC2011 model was adjusted to reflect the VOC emissions levels in 
the attainment years without the benefits of the post-base-year on-road 
motor vehicle control programs. Thus, the ``VMT offset ceiling'' 
scenarios reflect hypothetical VOC emissions in the South Coast if the 
State had not put in place any TCSs or TCMs after the base years and if 
there had been no growth in VMT or vehicle trips between the base years 
and the attainment years.

[[Page 29711]]

    The hypothetical growth in emissions due to growth in VMT and trips 
can be determined from the difference between the VOC emissions 
estimates under the ``no action'' scenarios and the corresponding 
estimates under the ``VMT offset ceiling'' scenarios. Based on the 
values in tables 1 and 2, the hypothetical growth in emissions due to 
growth in VMT and trips in the South Coast would have been 176 tpd 
(i.e., 488 tpd minus 312 tpd) for the purposes of the revised VMT 
emissions offset demonstration for the 1-hour ozone standard, and 26 
tpd (i.e., 115 tpd minus 89 tpd) for the purposes of the corresponding 
demonstration for the 8-hour ozone standard. These hypothetical 
differences establish the levels of VMT growth-caused emissions that 
need to be offset by the combination of post-baseline year TCMs and 
TCSs and any necessary additional TCMs and TCSs.
    For the ``projected actual'' scenario calculations, the State ran 
the EMFAC2011 model for the attainment years with VMT and starts data 
at attainment year values and with the full benefits of the relevant 
post-baseline year motor vehicle control programs. For this scenario, 
the State included the emissions benefits from TCSs and TCMs put in 
place since the base year. The most significant measures put in place 
during the 2002 to 2023 time frame, relied upon for the 8-hour ozone 
demonstration, include Low Emission Vehicles II and III standards, Zero 
Emissions Vehicle standards, and California Reformulated Gasoline Phase 
3. Again, see attachments 1 and 2 of the Appendix VIII to the 2012 
South Coast AQMP. These measures are also relied upon in the approved 
South Coast 8-hour ozone attainment demonstration and the revised South 
Coast 1-hour ozone attainment demonstration.\16\
---------------------------------------------------------------------------

    \16\ See 77 FR 12674 (March 1, 2012) for the EPA's approval or 
waiver/authorization of the TCSs and TCMs relied upon for the 1997 
8-hour ozone attainment demonstration in the 2007 South Coast AQMP. 
Also see Technical Support Document for the Final Rulemaking Action 
on the South Coast 2007 8-Hour Ozone Plan and the South Coast 
Portions of the Revised 2007 State Strategy, USEPA Region 9, 
December 2011. Also see footnote 15. Per section 209 of the CAA, the 
EPA has previously waived (for control of emissions from new motor 
vehicles of new motor vehicle engines prior to March 30, 1966) or 
authorized (for control emissions of nonroad engines or vehicles) 
all such TCSs and TCMs.
---------------------------------------------------------------------------

    As shown in tables 1 and 2, the results from these calculations 
establish projected actual attainment-year VOC emissions of 65 tpd for 
the 1-hour standard demonstration and 62 tpd for the 1997 8-hour 
standard demonstration. The State then compared these values against 
the corresponding VMT offset ceiling values to determine whether 
additional TCMs or TCSs would need to be adopted and implemented in 
order to offset any increase in emissions due solely to VMT and trips. 
Because the ``projected actual'' emissions are less than the 
corresponding ``VMT Offset Ceiling'' emissions, the State concluded 
that the demonstration shows compliance with the VMT emissions offset 
requirement and that there are sufficient adopted TCSs and TCMs to 
offset the growth in emissions from the growth in VMT and vehicle trips 
in the South Coast for both the 1-hour and 1997 8-hour standards. In 
fact, taking into account of the creditable post-baseline year TCMs and 
TCSs, the State showed that they offset the hypothetical differences by 
423 tpd for the 1-hour standard and by 53 tpd for the 1997 8-hour 
standards, rather than merely the required 176 tpd and 26 tpd, 
respectively.\17\
---------------------------------------------------------------------------

    \17\ The offsetting VOC emissions reductions from the TCSs and 
TCMs put in place after the respective base year can be determined 
by subtracting the ``projected actual'' emissions estimates from the 
``no action'' emissions estimates in tables 1 and 2. For the 
purposes of the 1-hour ozone demonstration, the offsetting emissions 
reductions, 423 tpd (488 tpd minus 65 tpd), exceed the growth in 
emissions from growth in VMT and vehicle trips (176 tpd). For the 
purposes of the 8-hour ozone demonstration, the offsetting emissions 
reductions, 53 tpd (115 tpd minus 62 tpd), exceed the growth in 
emissions from growth in VMT and vehicle trips (26 tpd).
---------------------------------------------------------------------------

    Based on our review of the State's submittal, including the 
technical supplement, we find the State's analysis to be acceptable and 
agree that the State has adopted sufficient TCSs and TCMs to offset the 
growth in emissions from growth in VMT and vehicle trips in the South 
Coast for the purposes of the 1-hour ozone and 1997 8-hour ozone 
standard. As such, we find that the revised South Coast VMT emissions 
offset demonstrations, comply with the VMT emissions offset requirement 
in CAA section 182(d)(1)(A), and therefore, we propose approval of the 
revised South Coast VMT emissions offset demonstrations for the 1-hour 
ozone and 1997 8-hour ozone standards as a revision to the California 
SIP.

IV. EPA's Proposed Action and Request for Public Comment

    Under CAA section 110(k)(3), and for the reasons set forth above, 
EPA is proposing to approve CARB's submittal dated February 13, 2013 of 
the revised South Coast VMT emissions offset demonstrations for the 1-
hour ozone and 1997 8-hour ozone standards, as supplemented by CARB on 
April 3, 2014, as a revision to the California SIP. We are proposing to 
approve this SIP revision because we believe that it demonstrates that 
California has put in place specific enforceable transportation control 
strategies and transportation control measures to offset the growth in 
emissions from the growth in VMT and vehicle trips in the South Coast 
for both the 1-hour ozone and 1997 8-hour ozone standards, and thereby 
meets the applicable requirements in section 182(d)(1)(A) of the Clean 
Air Act.
    EPA is soliciting public comments on the issues discussed in this 
document or on other relevant matters. We will accept comments from the 
public on this proposal for the next 30 days. We will consider these 
comments before taking final action.

V. Statutory and Executive Order Reviews

    The Administrator is required to approve a SIP submission that 
complies with the provisions of the Act and applicable Federal 
regulations. 42 U.S.C. 7410(k); 40 CFR 52.02(a). Thus, in reviewing SIP 
submissions, EPA's role is to approve State choices, provided that they 
meet the criteria of the Clean Air Act. Accordingly, this action merely 
proposes to approve a State plan revision as meeting federal 
requirements and does not impose additional requirements beyond those 
imposed by state law. For these reasons, this proposed action:
     Is not a ``significant regulatory action'' subject to 
review by the Office of Management and Budget under Executive Order 
12866 (58 FR 51735, October 4, 1993);
     Does not impose an information collection burden under the 
provisions of the Paperwork Reduction Act (44 U.S.C. 3501 et seq.);
     Is certified as not having a significant economic impact 
on a substantial number of small entities under the Regulatory 
Flexibility Act (5 U.S.C. 601 et seq.);
     Does not contain any unfunded mandate or significantly or 
uniquely affect small governments, as described in the Unfunded 
Mandates Reform Act of 1995 (Pub. L. 104-4);
     Does not have Federalism implications as specified in 
Executive Order 13132 (64 FR 43255, August 10, 1999);
     Is not an economically significant regulatory action based 
on health or safety risks subject to Executive Order 13045 (62 FR 
19885, April 23, 1997);
     Is not a significant regulatory action subject to 
Executive Order 13211 (66 FR 28355, May 22, 2001);
     Is not subject to requirements of Section 12(d) of the 
National Technology Transfer and Advancement

[[Page 29712]]

Act of 1995 (15 U.S.C. 272 note) because application of those 
requirements would be inconsistent with the CAA; and
     Does not provide EPA with the discretionary authority to 
address disproportionate human health or environmental effects with 
practical, appropriate, and legally permissible methods under Executive 
Order 12898 (59 FR 7629, February 16, 1994).
    In addition, this proposed rule does not have tribal implications 
as specified by Executive Order 13175 (65 FR 67249, November 9, 2000), 
because the SIP is not approved to apply in Indian country located in 
the State, and EPA notes that it will not impose substantial direct 
costs on tribal governments or preempt tribal law.

List of Subjects in 40 CFR Part 52

    Environmental protection, Air pollution control, Incorporation by 
reference, Intergovernmental regulations, Nitrogen dioxide, Ozone, 
Reporting and recordkeeping requirements, Volatile organic compounds.

    Authority: 42 U.S.C. 7401 et seq.

    Dated: May 5, 2014.
Jared Blumenfeld,
Regional Administrator, EPA Region 9.
[FR Doc. 2014-11511 Filed 5-22-14; 8:45 am]
BILLING CODE 6560-50-P
```