Ventura County Air Pollution Control District 

FINAL STAFF REPORT – March 2, 2009 

REVISIONS TO RULE 70 

STORAGE AND TRANSFER OF GASOLINE 

BACKGROUND

Rule 70, first adopted on June 25, 1974, regulates the 

storage and transfer of gasoline at bulk plants, 

terminals, and vehicle dispensing facilities (service 

stations). The rule has been amended several times 

since then. The last revision, adopted on November 

11, 2003, corrected a deficiency noted by EPA. 

The primary revision proposed in this rule action is 

also based on EPA input. In December, 20061

, EPA 

released guidance on the removal of "Stage II 

gasoline vapor recovery systems" for specific 

portions of the motor vehicle fleet with at least a 95% 

penetration of Onboard Refueling Vapor Recovery 

(ORVR) systems (see Appendix 1). These included: 

1. Initial fueling of new vehicles at automobile 

assembly plants. 

2. Refueling of rental cars at vehicle rental 

facilities. 

3. Refueling of flexible fuel vehicles at E85 

dispensing pumps (85% ethanol fuel). 

In November, 20072

, corporate fleets were added to 

the list of applicable fleet situations (see Appendix 

2). The Air Resources Board followed up on this 

guidance in February, 20083

, by encouraging local air 

districts to modify their gasoline dispensing facility 

(GDF) rules to exempt specific ORVR fleets from 

Phase II vapor recovery requirements (see Appendix 

3). This rule action proposes just such an exemption. 

Other revisions to various subsections of the rule are 

also proposed, including annual testing for Phase I 

vapor recovery systems. These revisions are 

discussed below. 

PROPOSED RULE 

To implement an exemption from the Phase II vapor 

recovery requirements for fleets with ORVR systems, 

a new exemption is proposed as Subsection F.8: 

8. The requirement for Phase II vapor recovery 

in Subsection B.9, as well as the applicable 

testing requirements in Section H, shall not 

apply to any gasoline or E85 storage 

container with 250 gallons or more capacity 

that is used to fuel a motor vehicle fleet 

where no less than 95 percent of the motor 

vehicles fueled are equipped with Onboard 

Refueling Vapor Recovery (ORVR) systems. 

To qualify, the storage container must be 

owned by the vehicle fleet operator. This 

exemption shall not apply to facilities 

required under state law to have Phase II 

vapor recovery.

As noted above, EPA's guidance on ORVR exemptions discussed four specific fleet operations; automobile assembly plants, vehicle rental, E85 dispensing, and corporate fleets. The proposed exemption 

is more general, allowing other operations to qualify 

for an exemption. This is consistent with rules 

already in place at the Bay Area AQMD, the San 

Joaquin Valley APCD, and the Monterey Bay 

Unified APCD. 

Note that the proposed exemption conflicts with the 

state Airborne Toxics Control Measure (ATCM), 

which requires Phase II controls on all retail stations 

that dispense more than 480,000 gallons of gasoline 

per year. The last sentence in proposed Subsection 

F.8 clarifies that the exemption does not override this 

or any other applicable state requirement.4

To augment the exemption in Subsection F.8, the 

following recordkeeping requirements are recommended as new Subsection G.3: 

3. Any person claiming an exemption from the 

provisions of Subsection B.9 of this rule, 

based on the provisions of Subsection F.8 of 

this rule, shall keep the following records to 

substantiate the exemption:
FINAL STAFF REPORT - Rule 70 Page 2 

March 2, 2009 

a. Name, address, type of facility, and 

permit number (if applicable); and

b. Records showing the make, model year, 

vehicle identification number, and 

license plate number (if available) of 

each motor vehicle fueled from the 

applicable gasoline storage tank and a 

statement certifying that an ORVR 

system is in place and functional on 

each vehicle.

At this time, it is unlikely that CARB will certify a 

Phase II system for E85 fuel in the near future 

because various technical problems with these 

systems and E85 fuel have yet to be solved. Therefore, staff proposes the following exemption as 

Subsection F.9: 

9. The requirement for Phase II vapor recovery 

in Subsection B.9, as well as the applicable 

testing requirements in Section H, shall not 

apply to any storage container with 250 

gallons or more capacity that is used to 

distribute E85 fuel.

In addition, definitions of "E85 fuel," "Fleet" and 

"ORVR" are recommended in Section J as follows: 

7. "E85 Fuel": A motor fuel that contains 85 

percent ethanol and 15 percent gasoline.

8. "Fleet": A group of vehicles under common 

operation and control by a person, company, 

business, corporation, organization, public 

entity, or any combination thereof, and are 

dispatched from at least one location within 

the District. For the purpose of this rule, 

each of the following facilities shall be 

considered a fleet:

 a) Port-related new vehicle processors

 b) New and used automobile and light 

truck dealers

 c) Automobile and light truck rental 

facilities

19. "Onboard Refueling Vapor Recovery 

(ORVR)": a system built into a motor 

vehicle to recover and contain gasoline 

vapors before they reach the fuel filler spout, 

as required by California Code of Regulations, title 13, section 1978, or 40 Code of 

Federal Regulations Part 86.

Other Revisions 

In addition to the above amendments, staff is 

proposing a number of minor revisions to various 

subsections of Rule 70, as described below. 

Section B, Requirements

Staff is proposing to add two provisions to Rule 70, 

Section B, to enhance reactive organic compound 

(ROC) emission reductions and aid rule enforcement. 

New Subsection B.17 is being added to codify a 

requirement prohibiting standing gasoline in the spill 

boxes that surround gasoline delivery connectors on 

underground storage tanks. 

17. Standing gasoline in Phase I spill 

containment devices is prohibited.

Rule 70 currently requires a record of repairs made to 

Phase II vapor recovery equipment (Subsection G.4). 

However, there is no requirement to inspect Phase II 

hardware on a regular basis. Daily equipment inspections are required by many corporate owners for their 

own protection. Staff proposes to codify a requirement to inspect Phase II hardware daily, as follows: 

18. The hanging hardware on Phase II vapor 

recovery systems, which includes, but is not 

limited to, coaxial hose, nozzles, retractors 

and hose castings, shall be inspected daily.

Section G, Recordkeeping

To augment the daily inspection requirement, new 

Subsection G.6 is being added to require a record of 

the daily inspections. 

6. Records of daily inspections required in 

Subsection B.18 shall be maintained. 

Records shall include the date and time of 

the inspection, the equipment inspected, and 

the signature of the person conducting the 

inspection.

Also, Subsection G.1 has been rewritten for clarity. 

The function of the subsection is unchanged. 

Section H, Testing and Test Methods

Compliance Division has occasionally had problems 

getting final test reports from operators or testing 

contractors. As a result, new Subsection H.11 will 
FINAL STAFF REPORT - Rule 70 Page 3 

March 2, 2009 

require final written reports no later than 14 days 

after the date of the tests. 

11. The results of any test required by either this 

rule or a CARB executive order shall be 

delivered by the permittee to the District, in 

final written report format, no later than 14 

days after completion of the subject testing.

Section J, Definitions

In addition to the new definitions noted above, the 

definition of "Major Modification" (renumbered 

Subsection J.16) is being revised to clarify the 

requirements for Phase II systems. Subsection 

J.16.b) is proposed to read: 

b) Either the replacement of the Phase II system

or the modification Modification of the Phase 

II system that involves the addition, 

replacement or removal of 50 percent or 

more of the buried vapor piping, or the 

replacement of dispensers, is considered a 

major modification of the Phase II system. 

The replacement of a dispenser is not a 

major modification when the replacement is 

occasioned by end user damage to a 

dispenser. 

This definition applies only to Subsection B.7 and 

Section H of this rule and does not supersede the 

definition of major modification in CARB 

document D-200.

This revision clarifies that the replacement of a Phase 

II system is a major modification and, as such, will 

require a complete round of Phase II testing. The 

new final statement clarifies that this definition does 

not supersede the CARB definition. 

DISCUSSION

EPA has provided guidance on the removal of "Stage 

II gasoline vapor recovery systems" for motor vehicle 

fleets with at least a 95% penetration of ORVR 

systems. These included: 

1. Initial fueling of new vehicles at automobile 

assembly plants. 

2. Refueling of rental cars at vehicle rental 

facilities. 

3. Refueling of flexible fuel vehicles at E85 

dispensing pumps. 

4. Corporate fleets. 

In December, 2006, EPA provided the following 

analysis of their decision to recommend exemption 

from Phase II requirements of ORVR. 

Various metrics have been studied for 

demonstrating widespread use of ORVR in 

motor vehicle fleets. One metric focuses on the 

percentage of vehicles in service that are 

ORVR-equipped. Based on our preliminary 

analysis, this metric seems to track fairly closely 

with the percentage of vehicle miles traveled 

(VMT) from ORVR-equipped vehicles, and 

with the percentage of gasoline sold which is 

dispensed to ORVR-equipped vehicles. In fact, 

since newer vehicles tend to be driven more 

miles than older models, VMT traveled by 

ORVR-equipped vehicles and gasoline 

dispensed to ORVR-equipped vehicles may 

exceed 95 percent in a 95 percent ORVRequipped fleet. 

Another metric that EPA considered is when 

VOC emissions resulting from the application 

of ORVR controls alone equal the VOC 

emissions when both Stage II vapor recovery 

systems and ORVR controls are used, after 

accounting for incompatibility excess 

emissions. The incompatibility excess 

emissions factor relates to losses in control 

efficiency when certain types of Stage II and 

ORVR are used together. Studies conducted in 

three northeastern states indicate that when the 

percentages of motor vehicles in service with 

ORVR, vehicle miles traveled by ORVRequipped vehicles, or gasoline dispensed to 

ORVR-equipped vehicles are above 95 percent, 

then the widespread use metric based on 

comparable VOC emissions will likely have 

been reached. For this reason, EPA believes 

that if 95 percent of the vehicles in a fleet have 

ORVR, then widespread use will likely have 

been demonstrated. 

Since the year 2000, all passenger cars have been 

required to have ORVR. Since 2006, all light duty 

trucks, SUVs and medium duty vehicles have been 

required to have ORVR. As a result, it is not difficult 

to assume that automobile assembly plants, rental 
FINAL STAFF REPORT - Rule 70 Page 4 

March 2, 2009 

cars, and corporate fleets have a high penetration of 

ORVR-equipped vehicles and that it is reasonable to 

exempt these fleets from Phase II vapor recovery 

requirements. 

In the proposed rule, staff has taken this concept one 

step further by proposing an exemption for any fleet 

that can demonstrate a 95 percent or greater penetration of ORVR-equipped vehicles. Although recordkeeping will be required, we believe that, based on 

the EPA analysis, the proposed exemption is 

reasonable and will not impact air quality in Ventura 

County. 

E85 dispensing 

E85 is a blend of no more than 85 percent ethanol 

and at least 15 percent gasoline. It can be used only 

in specially designed flexible fuel vehicles (FFVs). 

Due to the high alcohol content, existing conventional Phase II equipment may not work properly; 

different construction materials may be required. As 

a result, no California certified Phase II vapor 

recovery systems are currently available. 

At this time, the Navy is building the county's first 

E85 dispensing station in Port Hueneme. Although a 

Phase II system was designed into the project, CARB 

has decided to suspend certification testing on the 

system. Subsection F.9 is proposed to exempt all 

E85 dispensing tanks from Phase II requirements. 

Although ethanol is no longer the fuel of choice to 

reduce both foreign oil imports and greenhouse gas 

emissions, it is possible that E85 will become more 

prevalent in the County in the future. 

According to EPA estimates, 59 percent of the FFVs 

in current use are equipped with ORVR. All FFVs 

built today have ORVR, so this percentage is likely 

to increase. EPA's willingness to exempt E85 

dispensing from Phase II vapor recover requirements 

is based in an assumption that "the air quality impact 

of allowing E85 refueling facilities to operate without 

Phase II controls would likely be minimal in most 

non-attainment areas." Since FFVs currently comprise about 2 percent of the total US vehicle fleet, and 

non-ORVR FFVs are less 1 percent of that, EPA’s air 

quality impact assumption is probably good. 

In their guidance letter (See Appendix 1) , EPA 

further states that "if an area can demonstrate that any 

increase in emissions caused by operating E85 

fueling facilities without Phase II controls is so small 

as to clearly not interfere with attainment of the 

ozone standard ... , then EPA expects it could find 

that ORVR is in widespread use for FFVs when 

refueling at E85 facilities in this area." According to 

the California Department of Motor Vehicles5

, there 

are 528,000 automobiles registered in Ventura 

County. At one percent of this total, the number of 

non-ORVR FFVs is 5,280. It is likely that a 

demonstration of insignificance could be made for 

fueling these FFVs. To provide the exemption, EPA 

also requires the District to remove E85 from the 

definition of gasoline for the purposes of Phase II 

vapor recovery. Such a definition has been added to 

Rule 70 as Subsection J.7. 

Staff assumes that, based on the EPA justification 

above, the fueling of FFVs without Phase II vapor 

recovery will not significantly impact attainment of 

state and federal ozone standards. For details on the 

E85 exemption in Subsection F.9, see page 1. 

EMISSION REDUCTION / COST EFFECTIVENESS

Emission Reduction 

The proposed exemption for ORVR will result in no 

measurable increase or reduction in ROC emissions 

in Ventura County. As quoted above from the EPA 

December, 2006, guidance letter, EPA assumes that, 

when ORVR penetration is above 95 percent, ROC 

emissions from the two systems will be comparable 

and consistent with the "widespread use metric" in 

federal law. In addition, as noted below, the ROC 

emission reduction expected from other proposed 

revisions to Rule 70 is considered unmeasurable. 

Cost-Effectiveness 

Health & Safety Code §40703 states that the district 

must consider, and make public, “the costeffectiveness of a control measure.” The proposed 

revisions to Rule 70 are not included in an AQMP 

control measure. Therefore, it is not necessary to 

calculate the cost-effectiveness of the proposed 

revision. Furthermore, the lack of a measurable ROC 

emission reduction makes it impossible to calculate 

cost-effectiveness. 
FINAL STAFF REPORT - Rule 70 Page 5 

March 2, 2009 

SOCIOECONOMIC IMPACT

Health & Safety Code § 40728.5 requires the Air 

Pollution Control Board consider the socioeconomic 

impact of any new rule or amendment to an existing 

rule if air quality or emission limits are significantly 

affected. The proposed revisions to Rule 70 involve 

no measurable ROC emission reductions. However, 

Rule 70 imposes emission reduction requirements on 

gasoline dispensing facilities in Ventura County, 

which affects air quality. Therefore, the requirements 

of § 40728.5 must be evaluated. 

The Board must evaluate the following socioeconomic information on new Rule 70: 

(1) The type of industries or business, including 

small business, affected by the rule or 

regulation.

 Rule 70 affects all gasoline dispensing facilities 

in Ventura County. The rule requires Phase I 

and Phase II vapor recovery equipment at all 

facilities and specifies maintenance and testing 

requirements. 

(2) The impact of the rule or regulation on 

employment and the economy of the region 

affected by the adoption of the rule or 

regulation 

. The adoption of revisions to Rule 70 is expected 

to have no impact on employment in and the 

economy of Ventura County. 

(3) The range of probable costs, including costs to 

industry or business, including small business, 

of the rule or regulation. 

 No increase in costs is expected. 

(4) The availability and cost-effectiveness of 

alternatives to the rule or regulation being 

proposed or amended. 

 EPA Region IX and ARB have requested the 

proposed ORVR exemption from Rule 70. 

Other revisions are proposed by staff. No 

alternatives to these revisions are available. 

(5) The emission reduction potential of the rule or 

regulation. 

 The estimated total ROC emission reduction for 

the proposed revisions to Rule 70 cannot be 

quantified. The proposed ORVR exemption is 

expected to neither increase nor decrease ROC 

emissions. 

(6) The necessity of adopting, amending, or 

repealing the rule or regulation in order to 

attain state and federal ambient air standards 

pursuant to Chapter 10 (commencing with 

Section 40910). 

 The ROC emission reductions inherent in Rule 

70 appear as implemented measures in the 2007 

Air Quality Management Plan and assist in the 

District's progress towards attainment and 

maintenance of the federal and California 

ambient air quality standards. No additional 

credit for ROC emission reductions will appear 

in the AQMP as a result of the proposed 

revisions to Rule 70. The proposed revisions do 

not appear in any AQMP control measure. 

ENVIRONMENTAL IMPACTS OF METHODS OF COMPLIANCE / CEQA

Methods of Compliance 

California Public Resources Code § 21159 requires 

the District to perform an environmental analysis of 

reasonably foreseeable methods of compliance if the 

proposed rule requires “the installation of pollution 

control equipment, or [specifies] a performance 

standard or treatment requirement...” The proposed 

revisions to Rule 70 involve no additional pollution 

control equipment. Therefore, no analysis is 

required. 

CEQA 

Staff has determined that adoption of the proposed 

revisions to Rule 70 is exempt from the requirements 

of the CEQA under Sections 15061(b)(3) of the 

CEQA Guidelines, which involves an action where it 

can be seen with certainty that there is no possibility 

that the activity in question may have a significant 

effect on the environment. No exceptions to this 

categorical exemption apply. 
FINAL STAFF REPORT - Rule 70 Page 6 

March 2, 2009 

ANALYSIS OF EXISTING FEDERAL AND DISTRICT REGULATIONS

California Health & Safety Code Section 40727.2(a) 

requires districts to provide a written analysis of 

existing regulations prior to adopting, amending or 

repealing a regulation. Section 40727.2(a) states: 

 In complying with Section 40727, the district 

shall prepare a written analysis as required by 

this section. In the analysis, the district shall 

identify all existing federal air pollution control 

requirements, including, but not limited to, 

emission control standards constituting best 

available control technology for new or 

modified equipment, that apply to the same 

equipment or source type as the rule or 

regulation proposed for adoption or 

modification by the district. The analysis shall 

also identify any of that district's existing or 

proposed rules and regulations that apply to the 

same equipment or source type, and all air 

pollution control requirements and guidelines 

that apply to the same equipment or source type 

and of which the district has been informed 

pursuant to subdivision (b). 

Rule 70 involves the operation and maintenance of 

equipment used for the storage and transfer of 

gasoline, including vapor recovery systems. These 

systems constitute the emission control equipment 

required by the rule. No additional emission control 

equipment is proposed. The proposed revisions 

involve an exemption for ORVR equipped fleets, the 

frequency of Phase I EVR tests, and other revisions. 

No federal requirements are sited in the EPA 

Gasoline Vapor Recovery Guidelines; therefore, no 

federal requirements apply. 

In addition, APCD Rule 71.2, Storage of Reactive 

Organic Compound Liquids, regulates gasoline 

storage containers of more than 40,000 gallons. 

INCREMENTAL COST-EFFECTIVENESS 

Health and Safety Code Section 40920.6 requires the 

performance of an incremental cost-effectiveness 

analysis for a regulation that identifies more than one 

control option to meet the same emission reduction 

objectives. Incremental cost-effectiveness is defined 

as the difference in costs divided by the difference in 

emission reductions between one level of control and 

the next more stringent level of control. 

Rule 70 regulates gasoline dispensing facilities in 

Ventura County by requiring Phase I and Phase II 

vapor recovery equipment. Although various styles 

and designs are available, no alternative emission 

control equipment is available. 

MEETINGS AND COMMENTS

Workshop 

November 11, 2008 

No interested parties attended this workshop and no 

discussion occurred. 

Air Resources Board 

January 6, 2009 

In Subsection C.2.c, ARB recommends changing the 

reference to ARB Test Method TP 203 to TP 203.1. 

The method is used to determine terminal emission 

factors. There is no TP 203, only TP.203.1. This 

change appears in the January 7, 2009, draft rule. 

Western States Petroleum Association 

January 27, 2009 

Affiliates of WSPA contacted staff by telephone and 

email with comments on the proposed rule. 

Comments are italicized, followed by staff response. 

BP-ARCO – January 27, 2009

BP-ARCO appreciates the opportunity to submit 

comments on the proposed rulemaking to 

amend Rule 70. Unfortunately, we did not 

receive notice of these proposed changes until 

last week. We have submitted the notice to the 

Western States Petroleum Association and have 

found that we are not alone in this late receipt 

of the notice. The following comments are 

based on a rapid review and evaluation of the 

proposed amendments and the draft Staff 

Report. We would very much appreciate an 

extension of the comment period to allow for a 
FINAL STAFF REPORT - Rule 70 Page 7 

March 2, 2009 

more through review/analysis and perhaps 

some discussion with Staff. 

It is very discouraging that an air district would 

increase the frequency of any vapor recovery 

related testing given the enhanced nature of the 

vapor recovery equipment and the 

implementation of in-station diagnostics (ISD). 

Such requirements should be going in the other 

direction. In the Staff Report on this 

rulemaking, the agency claims that the 

"compliance staff has seen an increase in 

problems with Phase I equipment," but the 

Report does not give any specifics relative to 

these "problems." BP-ARCO is not aware of 

any recent "problems" with EVR Phase I 

equipment. The agency further claims that "the 

proposal will result in no measurable reduction 

in ROC emissions." If the staff observed 

"problems" were properly identified, one would 

think that this should provide enough 

information to quantify potential increased 

emission problems. BP-ARCO objects to the 

agency imposing an additional cost of about 

$100 per facility for testing that will not result 

in any further emission reductions. 

The amendment of the "major modification" 

definition is of concern given that the multihose 

dispenser exclusion that is integrated into the 

CARB EVR program is part of this definition. 

The agency's rationale behind the amendment is 

to be able to require a full round of Phase II 

testing following the installation of EVR Phase 

II. We would want some assurance that this 

amendment will not affect the multihose 

dispenser exclusion as provided by state 

regulations. BP-ARCO suggests that there 

should be a more direct way to amend the Rule 

to require a full round of Phase II testing 

without modifying a definition that is uniformly 

written and applied throughout the state. 

Again, we have not had adequate time to fully 

evaluate the totality of this proposed 

rulemaking and we respectfully request an 

extension in time to comment for further 

consideration of this rulemaking. 

In a teleconference on January 27, 2009, between 

District staff, BP-ARCO, Chevron Global 

Downstream Marketing, and other WSPA affiliates, 

staff agreed that In-Station Diagnostics (ISD) could 

help reduce the number of ongoing Phase I 

compliance problems. Of particular concern are 

Pressure/Vacuum (PV) valves, which fail at a 

particularly frequent rate (estimated to be about 

50%). As a result, staff will not pursue additional 

Phase I compliance testing at this time. The Phase I 

testing proposal was removed from the draft rule 

considered by the Advisory Committee. Discussion 

of this issue now appears in Appendix 4 of this staff 

report. 

In addition, the proposed revision to the definition of 

"major modification' was discussed. Staff assured 

WSPA that the proposed revision will not impact the 

"multi-hose dispenser exclusion" and agreed to add 

clarification of this issue to the staff report. 

Chevron Global Downstream Marketing – January 

27, 2009 

Per H(8), Chevron is strongly opposed to this 

increase in performance testing as all of the 

facilities have been recently 'upgraded' to EVR 

Phase II and In Station Diagnostics. With the 

addition of this expensive monitoring why 

would the district be imposing additional 

performance testing. Further, additional 

emissions are emitted each time performance 

tests are conducted. Given the economic 

conditions as well as the recent station 

upgrades, it would be better to maintain the 

existing testing requirements. 

Per J(17), I am unclear as to the thought 

process on the change to the definition? Will 

upgrading stations to EVR and ISD be 

considered a major modification? 

Regarding your question on Subsection J.17, if 

upgrading to Phase II EVR and ISD involves either 

of the stated criteria (a change in 50% or more of the 

underground piping or replacement of the 

dispensers), then the upgrade would be a major 

modification. This is not changing. With the 

proposed change, we wish to clarify that replacing a 

Phase II system is also a major modification. The 

original definition of "major modification" used in 

the rule appears in ARB document D-200. 

BP-ARCO – January 29, 2009

The manner in which the Ventura County APCD 

proposes to amend the definition of "major 

modification" would seem to be an attempt to 

override the "grandfather" exemption provided 

under the EVR regulations as cited under CP201 - 4.10. This exemption was provided as a 

result of a CARB Resolution signed on 

07/22/04. The Western States Petroleum 

Association (WSPA) requests that the proposed 
FINAL STAFF REPORT - Rule 70 Page 8 

March 2, 2009 

amendment be revised to make sure that this 

exemption remains under Rule 70 consistent 

with CP-201. We would also appreciate 

clarification in the Staff Report associated with 

this rulemaking. 

AIR RESOURCES BOARD / Resolution 04-21 / 

July 22, 2004 /WHEREAS, the Board's staff has 

proposed revisions to section 4.11 of CP-201 

that will allow upgrades to ORVR compatible 

systems without triggering the unihose 

requirement and thus reduce costs to station 

operators; 

CP-201 - 4.10 / Unihose MPD Configuration / 

There shall be only one hose and nozzle for 

dispensing gasoline on each side of a multi 

product dispenser (MPD). This shall not apply 

to facilities installed prior to April 1, 2003 

unless the facility replaces more than 50 

percent of the dispensers. Facility 

modifications that meet the definition of "major 

modification" for a Phase II system in D-200 

trigger the unihose requirement as the facility is 

considered a "new installation". Exception: 

dispensers which must be replaced due to 

damage resulting from an accident or 

vandalism may be replaced with the previously 

installed type of dispenser. [as revised on 

05/26/06] 

We also appreciate your agency's withdrawing 

the proposal to increase the testing frequency 

for EVR I from 3 years to annual. With the 

introduction of in-station diagnostics (ISD), this 

is just counter productive to the intent of ISD. 

With increased confidence in the abilities of 

ISD, we hope that air districts will begin to 

relax the periodic testing requirements 

associated with EVR I & II. We stand ready to 

further discuss any issues your agency has 

related to EVR I & II. 

The proposed revision to the definition of "Major 

Modification" in Subsection J.16.b) reads as follows: 

b) Either the replacement of the Phase II system 

or the modification Modification of the Phase 

II system that involves the addition, 

replacement or removal of 50 percent or 

more of the buried vapor piping, or the 

replacement of dispensers, is considered a 

major modification of the Phase II system.... 

This definition applies only to Subsection B.7 and 

Section H of this rule and does not supersede the 

definition of major modification in CARB 

document D-200.

The proposed revision clarifies that replacing a Phase 

II system, without regard to the status of the 

dispensers, is a major modification and will require 

compliance testing. As such, the revised language 

enables the "multi-hose dispenser exclusion" by 

acknowledging that dispenser replacement may or 

may not occur and establishing a criteria for each 

case. The new final statement clarifies that this 

definition does not supersede the CARB definition. 

As noted above, ARB document CP-201, 

Certification Procedure for Vapor Recovery Systems 

at Gasoline Dispensing Facilities, states that "facility 

modifications that meet the definition of "major 

modification" for a Phase II system in D-200 trigger 

the unihose requirement as the facility is considered a 

'new installation'." This means that use of the "multihose dispenser exclusion" is controlled by the 

definition of "major modification" in ARB document 

D-200, not by a local agency definition. Therefore, 

application of the "multi-hose dispenser exclusion" is 

not effected by the proposed revisions to Rule 70. 

As noted above, staff agreed to remove from the 

revised rule the proposal to increase Phase I testing 

from three years to one year. As a result, the 

proposed amended rule language and the discussion 

and analysis of the proposal have been removed from 

the body of the staff report and moved to Appendix 4. 

An additional statement was added to Subsection J.16 

as noted above. No other changes to the proposed 

rule were made as a result of the discussions with 

WSPA. 

Advisory Committee 

January 27, 2009 

The Advisory Committee discussed various aspects 

of the draft amended rule, including the advantage of 

the proposed exemption from Phase II vapor recovery 

for ORVR fleets. Public attendees discussed issues 

relating to the function and availability of the 

Enhanced Vapor Recovery (EVR) Phase II systems 

that are due to be in place by April 1, 2009. Staff 

verified that the dispensing of E85 fuel is proposed 

for exemption from Phase II requirements. The 

Committee recommended an improved definition of 

E85. With that change, the Committee recommended 

unanimously adoption of the amended rule by the Air 

Pollution Control Board. 
FINAL STAFF REPORT - Rule 70 Page 9 

March 2, 2009 

REFERENCES

1. EPA Memorandum: Removal of Stage II Vapor 

Recovery in Situations Where Widespread Use 

of Onboard Refueling Vapor Recovery is 

Demonstrated, Stephen D. Page, Director, 

Office of Air Planning and Research, and 

Margo Tsirigotis Oge, Director, Office of 

Transportation and Air Quality, December 12, 

2006 (Appendix 1) 

2. EPA Memorandum: Removal of Stage II Vapor 

Recovery from Refueling of Corporate Fleets, 

Stephen D. Page, Director, Office of Air 

Planning and Research, and Margo Tsirigotis 

Oge, Director, Office of Transportation and Air 

Quality, November 28, 2007 (Appendix 2) 

3. Letter to "All Local Air District Air Pollution 

Control Officers" from James N. Goldstene, 

Executive Officer, California Air Resources 

Board, February 20, 2008 (Appendix 3) 

4. Proposed Amendments to BAAQMD Regulation 

8, Rule 7: Gasoline Dispensing Facilities, Draft 

Staff Report, Bay Area Air Quality Management 

District, October 2002, page 6 

5. Estimated Fee Paid Vehicle Registrations By 

County For The Period Of January 1 Through 

December 31, 2007, California Department Of 

Motor Vehicles, March, 2008 
FINAL STAFF REPORT - Rule 70 Page 10 

March 2, 2009 

Appendix 1 

USEPA Memo on ORVR and Stage II Vapor Recovery 

UNITED STATES ENVIRONMENTAL PROTECTION AGENCY 

RESEARCH TRIANGLE PARK, NC 27711 

DEC 12 2006 

MEMORANDUM

OFFICE OF 

AIR OUAUTY PLANNING 

AND STANDARDS 

SUBJECT: Removal of Stage II Vapor Recovery in Situations Where Widespread Use of 

Onboard Refueling Vapor Recovery is Demonstrated 

FROM: Stephen D. Page, Director 

Office of Air Quality Planning and Standards 

Margo Tsirigotis Oge, 

Director Office of Transportation and Air Quality 

TO: Regional Air Division Directors 

The purpose of this memorandum is to provide guidance to States concerning the removal of 

Stage II gasoline vapor recovery systems, where States demonstrate to EPA that widespread use of 

onboard refueling vapor recovery (ORVR) has occurred in specific portions of the motor vehicle 

fleet. The specific fleets addressed here include: 

1. initial fueling of new vehicles at automobile assembly plants 

2. refueling of rental cars at rental car facilities 

3. refueling of flexible fuel vehicles at E85 dispensing pumps 

Background

Stage II vapor recovery systems are required to be used at gasoline dispensing facilities 

located in serious, severe, and extreme non-attainment areas for ozone under section 182(b)(3) of 

the Clean Air Act (CAA). States have included these control measures in their federally-approved 

state implementation plans (SIPS) in the form of generally applicable regulatory requirements 

governing all gasoline dispensing facilities that exceed the relevant gasoline dispensing throughput 

criteria. However, section 202(a)(6) of the CAA allows EPA to revise or waive the section 

182(b)(3) Stage II requirement for these ozone non-attainment areas after the Agency determines 

that ORVR is in widespread use throughout the motor vehicle fleet. 

CAA section 202(a)(6) does not specify which motor vehicle fleet must be the subject of a 

widespread use determination before EPA may revise or waive the section 182(b)(3) Stage II 

requirement. Nor does the CAA identify what level of ORVR use in the motor vehicle fleet must 

be reached before it is "widespread." EPA expects the possibility of different rates of the 
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March 2, 2009 

implementation of ORVR across different geographic regions and among different types of 

motor vehicle fleets within any region. Given this, EPA does not believe that CAA section 

202(a)(6) must be read narrowly to allow a widespread use determination and waiver of the 

Stage II requirement for a given area or area's fleet only if ORVR use has become widespread 

throughout the entire United States, or only if ORVR use has reached a definite level in each 

area. Rather, EPA believes that section 202(a)(6) allows the Agency to apply the widespread use 

criterion to either the entire motor vehicle fleet in a State or non-attainment area, or to special 

segments of the overall fleet for which ORVR use is shown to be sufficiently high, and to base 

widespread use determinations on differing levels of ORVR use, as appropriate. Moreover, a 

single national rulemaking is not needed to grant such a waiver for a specific area. Instead, EPA 

believes that the Act allows the Agency to use an area-specific rulemaking approving a SIP 

revision to issue the section 202(a)(6) waiver for a relevant fleet in a non-attainment area, where 

a State meets the recommended criteria discussed below. 

Various metrics have been studied for demonstrating widespread use of ORVR in motor 

vehicle fleets. One metric focuses on the percentage of vehicles in service that are ORVRequipped. Based on our preliminary analysis, this metric seems to track fairly closely with the 

percentage of vehicle miles traveled (VMT) from ORVR-equipped vehicles, and with the 

percentage of gasoline sold which is dispensed to ORVR-equipped vehicles. In fact, since newer 

vehicles tend to be driven more miles than older models, VMT traveled by ORVR-equipped 

vehicles and gasoline dispensed to ORVR-equipped vehicles may exceed 95 percent in a 95 

percent ORVR-equipped fleet. 

Another metric that EPA considered is when VOC emissions resulting from the 

application of ORVR controls alone equal the VOC emissions when both Stage II vapor recovery 

systems and ORVR controls are used, after accounting for incompatibility excess emissions. The 

incompatibility excess emissions factor relates to losses in control efficiency when certain types 

of Stage II and ORVR are used together. Studies conducted in three northeastern states indicate 

that when the percentages of motor vehicles in service with ORVR, vehicle miles traveled by 

ORVR-equipped vehicles, or gasoline dispensed to ORVR-equipped vehicles are above 95 

percent, then the widespread use metric based on comparable VOC emissions will likely have 

been reached. For this reason, EPA believes that if 95 percent of the vehicles in a fleet have 

ORVR, then widespread use will likely have been demonstrated. 

1. Initial Fueling at Automobile Assembly Plants

Based on our preliminary analysis, EPA expects that if a State's submission of a SIP 

revision shows that 95 percent of the new vehicles fueled at an automobile assembly plant are 

equipped with ORVR, and that this level of ORVR use would not decrease, the Agency can 

determine that widespread use of ORVR has been achieved for the fleet of motor vehicles that 

are fueled at that facility. 

Since model year 2000, all passenger cars have been required to have ORVR. Also since 

2006, all light duty trucks, SUVs and medium duty vehicles are required to be equipped 
FINAL STAFF REPORT - Rule 70 Page 12 

March 2, 2009 

with ORVR. There may be a few situations, such as the chassis for motorized mobile homes, 

which still do not have ORVR. However, the number of these would be small. It is apparent 

that at most automobile assembly plants greater than 95 percent of the vehicles manufactured 

would have ORVR. Many assembly plants manufacture 100 percent ORVR equipped 

vehicles. Only such new vehicles are expected to be fueled at the automobile assembly, 

plants. 

States desiring to remove the Stage II requirement for these facilities would need to 

submit a SIP revision that EPA would evaluate through notice and comment rulemaking. The 

SIP would need to demonstrate that the widespread use benchmark has been achieved and 

provide assurance that any facility wishing to remove Stage II equipment maintains its 

eligibility for its motor vehicle fleet. Any EPA SIP approval would also be subject to the CAA 

section 110(1) requirement that the revision not interfere with any applicable requirement 

concerning attainment and reasonable further progress, or any other requirement of the CAA. 

2. Refueling of Rental Cars at Rental Car Facilities

Similarly, EPA expects that if a SIP revision submission demonstrates that 95 percent of 

the vehicles in an automobile rental fleet refueling at a rental car facility are equipped with 

ORVR and that this level of ORVR use would not decrease, then widespread use of ORVR 

could be found for the motor vehicle fleet refueling at that facility. Most large rental car 

companies rent current model vehicles that would all have ORVR. There may be truck rental 

companies which have older vehicles which do not have ORVR and that would not be able to 

demonstrate widespread use of ORVR for their fleets. As discussed above, any SIP revision 

would be subject to CAA section 110(1) and other applicable requirements, and State and local 

agencies should consider any potential transportation conformity impacts if Stage II is currently 

included in a SIP's on-road motor vehicle emissions budget. 

3. Refueling Flexible Fuel Vehicles at E85 Dispensing Pumps

E85 is a motor vehicle fuel that is a blend of as little as 15 percent gasoline and up to 

85 percent ethanol. (In wintertime applications, the ratio may be 30 percent gasoline and 70 

percent ethanol.) Ethanol is ethyl alcohol, a type of alcohol which can be produced from 

renewable resources such as corn. Based on the agency's survey of existing SIPS, EPA 

believes that most States have defined "gasoline" (for purposes of controlling emissions of 

VOC from refueling activities) to include gasoline/alcohol blends that have the same volatility 

as E85. EPA's guidance for States in developing their Stage II SIPs in the early 1990s 

suggested that States use the same definition of "gasoline" as the one found in EPA's 

Standards of Performance for Bulk Gasoline Terminals at 40 C.F.R. 60.501, which includes 

"any petroleum distillate or petroleum distillate/alcohol blend having a Reid vapor pressure of 

27.6 kilopascals (kPa) or greater which is used as a fuel for internal combustion engines." 

EPA recommended using this definition to most broadly reach situations in which refueling of 

motor vehicles results in evaporative VOC emissions that contribute to ozone non-attainment 

concentrations, and to avoid a narrow interpretation of what is "gasoline" that would allow 

significant VOC emissions from motor vehicle refueling activities in non-attainment areas to 

go uncontrolled. 
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March 2, 2009 

E85 can only be used in specially designed flexible fuel vehicles (FFVs), which have 

mostly been manufactured since 1998. Since these are newer vehicles, most of them are 

equipped with ORVR, and every FFV built today has ORVR. Thus, most vehicles refueling at 

E85 dispensing pumps are already having their evaporative emissions captured, as in the cases of 

late model rental cars refueling at rental car facilities and newly manufactured cars being fueled 

for the first time at automobile assembly plants. EPA estimates that 59 percent of FFVs in 

current use are equipped with ORVR. The percentage of FFVs with ORVR will continue to 

climb as older vehicles are taken out of service and new models join the fleet. Across different 

ozone non-attainment areas and between States, these percentages may vary. 

EPA believes that encouraging the use of E85 as a motor vehicle fuel reduces 

emissions of other air pollutants such as CO and benzene, a known human carcinogen, and 

reduces emissions of greenhouse gases. In addition, based on available information, the 

Agency is concerned that there is currently a lack of certified Stage II equipment for E85 

(which may require different materials of construction than conventional Stage II equipment), 

and that the timing for when certified E85-compatible equipment will become widely 

available is uncertain. This may unnecessarily hinder E85 distribution in areas that now 

require Stage II. 

Unlike in the cases of automobile assembly plants and rental car facilities, EPA is not 

recommending a specific percentage of the FFV fleet that should have ORVR before widespread 

use could be determined. This is because most E85 compatible vehicles are already equipped 

with ORVR and this percentage is increasing over time, whereas for automobile assembly plants 

and car rental facilities very high percentages of ORVR use have in most cases already been 

reached and are not expected to further increase significantly. The general use of ORVR in 

FFVs, instead, is expected to significantly increase, as are the miles driven by and amount of 

fuel dispensed to recent ORVR-equipped FFVs compared to those manufactured before 2000 

without ORVR. 

Moreover, we believe that in determining whether widespread use of ORVR has been 

demonstrated, it is reasonable under section 202(a)(6) to consider the VOC emissions impacts of 

removing Stage II, and that those impacts may inform the percentage of ORVR-equipped 

vehicles that would need to be achieved for a specific motor vehicle fleet or in a specific nonattainment area. EPA expects that the air quality impact of allowing E85 refueling facilities to 

operate without Stage II controls would likely be minimal in most non-attainment areas. FFVs 

currently comprise about 2 percent of the total US fleet. Non-ORVR FFVs are less 1 percent of 

the total U.S. vehicle fleet. EPA estimates that non-ORVR FFVs participate in only about 0.5 

percent of all refueling events. Furthermore, because of the relatively small number of stations 

that offer E85 (around 1,000 out of 170,000 total refueling stations) EPA believes that very few 

of these non-ORVR refueling events actually occur at E85 pumps. 

Considering the factors discussed above, if an area can demonstrate that any increase in 

emissions caused by operating E85 fueling facilities without Stage II controls is so small as to 

clearly not interfere with attainment of the ozone standard or reasonable further progress or any 

other applicable CAA requirement, then EPA expects it could find that ORVR is in widespread 

use for FFVs when refueling at E85 facilities in this area. These areas could then allow E85 

facilities to operate without Stage II controls, after modifying their SIPs such that E85 is not 
FINAL STAFF REPORT - Rule 70 Page 14 

March 2, 2009 

included within the definition of "gasoline" for purposes of Stage II vapor recovery controls (or 

after taking other necessary SIP revision action). As discussed above, States would need to 

submit SIP revisions affecting this change to their current Stage II SIPs, which EPA would 

evaluate through notice and comment rulemaking, subject to the provisions of CAA section 

110(1). In addition, State and local agencies should consider if there are any transportation 

conformity impacts related to removing Stage II, if emissions reductions from Stage II are 

included in a SIP's on-road motor vehicle emissions budget. Due to the expected rapid growth 

of E85 installations, EPA will explore the development of ways to expedite the SIP revision 

process for States which are dealing with the E85 issue. 

General Exclusions from Widespread Use Determinations

States in the ozone transport region (OTR) are still required to apply Stage II, or a 

comparable measure, in all areas under 184(b)(2) of the CAA. This requirement is not affected 

by any widespread use determination or waiver of the section 182(b)(3) requirement granted 

under section 202(a)(6). For the independent section 184(b)(2) "comparable measure" 

requirement to not prevent an appropriate removal of Stage II controls, OTR States may want to 

revisit their previously approved comparable measure SIPS to consider substituting available 

non-Stage II measures for the Stage II controls they currently require. 

Also, some States have chosen to add Stage II vapor recovery system requirements in 

their SIPs for ozone nonattainment areas that are classified in a category lower than "serious." 

While it is not necessary for States to demonstrate ORVR is in widespread use in moderate or 

cleaner ozone non-attainment areas, a revision of previously adopted SIP requirements to 

specifically waive Stage II requirements in such areas would need to comply with the 

provisions of CAA section 110(1) and, as described above, consider any transportation 

conformity impacts as applicable. 

This guidance for widespread use determinations for special sectors would not 

necessarily apply to widespread use determinations for the general motor vehicle fleet. Within 

the overall motor vehicle fleet, the rate of penetration of ORVR-equipped vehicles has not 

advanced at the same rapid rates as for the fleets discussed in this memorandum. EPA is still 

considering the possible criteria for determining widespread use for the general fleet. 
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March 2, 2009 

Appendix 2 

Second USEPA Memo on ORVR and Stage II Vapor Recovery 

UNITED STATES ENVIRONMENTAL PROTECTION AGENCY 

RESEARCH TRIANGLE PARK, NC 27711

NOV 28 2007 

OFFICE OF 

AIR QUALITY PLANNING 

AND RESEARCH 

MEMORANDUM

SUBJECT: Removal of Stage II Vapor Recovery from Refueling of Corporate Fleets 

FROM: Steven D. Page, Director 

Office of Air Quality Planning and Research 

Margo Tsirigotis, Director 

Office of Transportation and Air Quality 

TO: Regional Air Division Directors 

The purpose of this memorandum is to provide guidance to States concerning the removal 

of Stage II gasoline vapor recovery systems at gasoline refueling facilities exclusively dedicated 

to refueling "corporate" or "commercial" fleets, where States demonstrate to the Environmental 

Protection Agency (EPA) that widespread use of onboard refueling vapor recovery (ORVR) has 

occurred in such fleets. Corporate or commercial fleets include vehicles owned by corporations, 

governments, universities or other organizations which use the vehicles for business purposes 

and typically fuel the vehicles at fueling pumps owned and operated by the fleet owner and 

exclusively dedicated to fueling the fleet. 

On December 12, 2006, EPA issued a memorandum, "Removal of Stage II Vapor 

Recovery in Situations Where Widespread Use of Onboard Refueling Vapor Recovery is 

Demonstrated," (attached) which discussed how States may explore amendments to their State 

Implementation Plans (SIPs) to allow Stage II gasoline vapor recovery to be removed from 

specific fleet situations, namely: 

1. initial fueling of new vehicles at automobile assembly plants; 

2. refueling of rental cars at rental car facilities; and 

3. refueling of flexible fuel vehicles at E85 dispensing pumps. 

The December 12, 2006, memo states that widespread use of ORVR will likely have 

been demonstrated if 95 percent of the vehicles in a fleet have ORVR. In today's memorandum, 

EPA is indicating that it believes that if a -State demonstrates that 95 percent of the vehicles in a 

corporate or commercial vehicle fleet are equipped with ORVR and that this level of ORVR use 

would not decrease, then widespread use of ORVR could be found for the corporate or 
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March 2, 2009 

commercial motor vehicle fleet, such that Stage II controls could be considered for removal 

from a refueling facility that is exclusively dedicated to refueling that fleet. 

States desiring to remove the Stage II requirement for these facilities would need to 

submit a SIP revision that EPA would evaluate through notice and comment rulemaking. The 

SIP would need to demonstrate that the widespread use benchmark has been achieved and 

provide assurance that any facility wishing to remove Stage II equipment maintains its eligibility 

for its motor vehicle fleet. Any EPA SIP approval would also be subject to the Clean Air Act 

(CAA) section 110(1) requirement that the revision not interfere with any applicable requirement 

concerning attainment and reasonable further progress, or any other requirement of the CAA. In 

addition, State and local agencies should consider if there are any transportation conformity 

impacts related to removing Stage II, if emissions reductions. from Stage II are included in a 

SIP's on-road motor vehicle emissions budget(s). 

As mentioned in the December 12, 2006 memorandum, this guidance for widespread use 

determinations for corporate fleets would not necessarily apply to widespread use ' 

determinations for the general motor vehicle fleet. Within the overall motor vehicle fleet, the rate 

of penetration of ORVR-equipped vehicles has not advanced at the same rapid rates as in some 

corporate and rental fleets. EPA is still considering the possible criteria for determining 

widespread use for the general fleet. 

In addition, the December 12, 2006, memorandum explained that widespread use 

determinations would not affect separate requirements applicable to States in the ozone transport 

region. This exclusion would also apply in the case of corporate or commercial fleets with. 

widespread use of ORVR. 

If you have questions about this recommendation, you may contact William L. Johnson 

in EPA's Office of Air Quality Planning and Standards by telephone at 

(919) 541-5245 or by e-mail at johnson.williamL@epa.gov. 

Attachment 
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March 2, 2009 

NOV 28, 2007 EPA Memo

Attachment 2 

Estimated ROG Emission Increases 

From Removal of Stage 2 Vapor Recovery from E85 Fuel Dispensers 

Year 

Non-ORVR 

flex fuel 

vehicle 

population'

(1,000's) 

Annual 

VMT per 

vehicle2

, 

(1,000's) 

% 

VMT 

fueled 

with 

E853

E85 fuel 

economy4

(miles per 

gallon) 

Annual 

E85 used 

per 

vehicle5

, 

(gallons) 

Total E85 

used 

daily6

, 

1,000's 

(gallons) 

ROG 

emissions'

, 

statewide 

(tons per 

day) 

2005 110 13.5 0 14.8 0 0 0 

2010 95 11.4 5 14.8 38.5 10.0 0.035 

2015 67 10.3 15 14.8 104 19.1 0.073 

2020 34 9.3 25 14.8 157 14.6 0.055 

Notes:

1. Based on data provided to ARB by automobile manufacturers of flex fuel vehicles 

(FFVs) sold in California 1997 -2005, for which nearly all FFVs were light-duty 

trucks. Annual number of FFVs is estimated using survival fraction of vehicles as 

a function of vehicle age. Assumes all FFV light-duty trucks equipped with 

onboard refueling vapor recovery (ORVR) starting with MY2003. Average age of 

vehicles in 2005 non-ORVR FFV fleet is 4 years. 

2. Annual vehicle miles traveled (VMT) data for light-duty trucks based on 

EMFAC2007. 

3. Assumes increase in E85 refueling over time as number of E85 pumps increase 

and motorists become aware that E85 costs less than reformulated gasoline. 

The assumed percentages in each of the three years are estimates based on 

these factors. 

4. Assumes: 

• Fuel economy of FFVs operating on E85 based on U.S. EPA Fuel 

Economy Guides; 

• Fuel economy does not decline with vehicle age for newer model year 

vehicles equipped with advanced on-board diagnostics. 

5. Calculated: annual VMT X % fueled with E85 / fuel economy in miles per gallon. 

6. Calculated: vehicle population X annual gallons E85 / 365 days per year. 

7. Calculated: daily gallons of fuel used X evaporative emissions in pounds TOG 

per gallon of fuel throughput X 0.92 (ratio of ROG/TOG). 
FINAL STAFF REPORT - Rule 70 Page 18 

March 2, 2009 

Assumes: 

• E85 evaporative emissions factor same as emissions factor for reformulated gasoline. 

(Source: Full Fuel Cycle Assessment Well to Tank Energy Inputs, Emissions, and 

Water Impacts, CEC-600-2007-002-D, February 2007, pp. 5-30 to 5-35); 

• Reformulated gasoline evaporative emissions factor 7.6 pounds TOG per 1,000 

gallons of fuel throughput (Source: "Uncontrolled Vapor Emission Factor at Gasoline 

Dispensing Stations," January 5, 2000.) 
FINAL STAFF REPORT - Rule 70 Page 19 

March 2, 2009 

Appendix 3 

Air Resources Board Letter on ORVR and Phase II Vapor Recovery 

Air Resources Board 

Mary D. Nichols, Chairman 

1001 I Street • P.O. Box 2815 

Sacramento, California 95812 

February 20, 2008 

Addressees: All Local Air District Air Pollution Control Officers (APCO) 

Dear APCO: 

I am writing to encourage you to revise your district's vapor recovery rules as outlined by the 

U.S. Environmental Protection Agency (U.S. EPA) in the attached memoranda (Attachment 

1). U.S. EPA is encouraging states to eliminate the requirement for Phase II vapor recovery 

systems on gasoline refueling dispensers for certain motor vehicle fleets in light of the 

growing use of Onboard Refueling Vapor Recovery (ORVR) systems in those fleets. 

The fleets at issue are new vehicles initially fueled at motor vehicle assembly plants, late 

model rental cars refueled at rental car facilities, corporate fleets refueled at corporateowned pumps, and flexible fuel vehicles (FFVs) refueled at E85 fuel dispensers. 

Section 202(a)(6) of the federal Clean Air Act (Act) allows U.S. EPA to remove the 

requirement for vehicle refueling gasoline vapor recovery systems in ozone nonattainment 

areas after determining that ORVR systems for motor vehicles are in widespread use. For 

new vehicles initially fueled at motor vehicle assembly plants, late model rental cars refueled 

at rental car facilities, and corporate fleets refueled at corporate-owned pumps, U.S. EPA has 

defined widespread use as 95 percent of the vehicles equipped with ORVR. By virtue of 

being made up of new late-model vehicles, these fleets have met this criterion. 

For FFVs, U.S. EPA is recommending that states show that any increase in emissions 

caused by operating E85 refueling dispensers without vapor recovery systems is so small as 

not to interfere with ozone attainment. ARB staff has estimated the emissions to be less than 

0.10 tons per day of reactive organic gases statewide in 2015 (see Attachment 2) and 

believes that it is reasonable to conclude that there is no impact on ozone attainment. 

The process for revising a district's vapor recovery requirements is the same as for any other 

district rule State Implementation Plan (SIP) submission: adopt the amended rules at a public 

hearing and transmit the amended rules to ARB for processing as a SIP revision and 

submittal to U.S. EPA. ARB staff is available to assist you with rule review 
FINAL STAFF REPORT - Rule 70 Page 20 

March 2, 2009 

or in doing additional analysis before proceeding, including more specific emissions 

assessment and attainment impacts, impact on progress toward state standards, and any 

possible toxic air contaminant issues. 

If you have any questions or need further information regarding vapor recovery 

requirements, please contact Cindy Castronovo of the Monitoring and Laboratory Division 

at (916) 322-8957. For questions regarding the emissions impact analysis, please contact 

Dean Simeroth, Chief of the Criteria Pollutants Branch, at (916) 322-6020. 

Attachments 

cc: Dean Simeroth, SSD 

 Kurt Karperos, PTSD

 Cindy Castronovo, MLD 
FINAL STAFF REPORT - Rule 70 Page 21 

March 2, 2009 

Appendix 4 

Removed Proposal to Revise Phase I Test Frequency 

Proposed new Subsection H.8 (removed from consideration on January 27, 2009): 

8. After the initial test at the following facilities, the Phase I Enhanced Vapor Recovery (EVR) 

system tests referenced in the CARB executive order shall be performed annually.

a. Facilites with balance Phase II vapor recovery equipment and a throughput of more 

than 100,000 gallons per year.

b. Facilities with vacuum assist Phase II vapor recovery equipment.

Phase II vapor recovery equipment is tested annually at the same frequency. The proposal was made 

because compliance staff had seen an increase problems with Phase I equipment. The cost of these 

additional tests is discussed below. 

A reference to new Subsection H.8 was recommended for renumbered Subsection H.9 in the event that 

ARB someday requires Phase I EVR reverification testing more frequently than once per year. 

Table 1 

Gasoline Dispensing Facility Inspection Schedule Changes 

Assuming 141 Balance Stations and 99 Vacuum assist Stations 

and Accounting for 100,000 Gallon Per Year Threshold 

96 Balance >= 100,000 

Rule 70 

Subsection 

Existing 

Schedule 

Average 

Tests/year 

New 

Schedule 

Average 

Tests/year 

Percent 

Increase 

Static Pressure H.1 Annual 96 Annual 96 

Dynamic Pressure H.2 Annual 96 Annual 96 

Liquid Removal Rate H.3 Annual 1,152 Annual 1,152 

Phase I EVR (3 Grades)* H.4 3 years 96 Annual 288 

TOTAL 1,440 1,632 13.3 

 

45 Balance < 100,000 

Static Pressure H.1 2 years 23 2 years 23 

Dynamic Pressure H.2 4 years 11 4 years 11 

Liquid Removal Rate** H.3 4 years 135 4 years 135 

Phase I EVR (3 Grades) H.4 3 years 45 3 years 45 

TOTAL 214 214 0.0 

 

BALANCE TOTAL 1,654 1,846 11.6 

99 Vacuum assist 

Static Pressure H.1 Annual 99 Annual 99 

Dynamic Pressure H.2 Annual *** Annual *** 

Air To Liquid Vol. Ratio H.7 Annual 99 Annual 99 

Phase I EVR (3 Grades) H.4 3 years 99 Annual 297 

VACUUM Asst TOTAL 297 495 66.7 

 

 * One test for each of three grades ** Assumes a conservative 12 nozzles per station *** Done as a "wet" A/L test at no additional cost 
FINAL STAFF REPORT - Rule 70 Page 22 

March 2, 2009 

Additional Phase I Testing 

As noted above, new Subsection H.8 will require the Phase I vapor recovery equipment at the 

following gasoline dispensing facilities to be tested annually. 

• Facilites with balance Phase II vapor recovery equipment and a throughput of more than 

100,000 gallons per year 

• Facilities with vacuum assist Phase II vapor recovery equipment 

Annual testing is proposed because compliance staff has seen an increase in problems with Phase I 

equip-ment. An estimate of the increase in individual tests and the precent increase in test frequency 

appears in Table 1. While an increase in test frequency may result in fewer breakdowns, or 

breakdowns of shorter duration, the proposal will result in no measurable reduction in ROC emissions. 

To measure the effectiveness of the proposed revision, defects must be counted. It is not possible to 

know the number of additional defects that will be found under the proposed rule. Furthermore, the 

District has no comparable data on past defects. In addition, GDF operators are allowed to conduct 

pretests, where many defects are fixed before the District inspector arrives. Even of we start now 

counting defects, we will never know the effect of the proposed rule. It is for this reason that the ROC 

emission reduction expected from the proposed revisions is considered unmeasurable. 

No additional credit for ROC emission reductions will appear in the AQMP as a result of any proposed 

revision to Rule 70. 

Cost Increase for Phase I Testing 

In calculating the annual cost of testing and District observation, certain assumptions were made. To 

determine the cost of each of five typical GDF tests (static, dynamic, liquid removal, air to liquid ratio, 

and Phase I EVR), several testing companies were polled and nominal estimates were made. These 

estimates appear in Table 2. District costs are from Rule 47. 

The greater number of reverification tests shown in Table 1 will increase both the cost of testing and 

the cost of District test observation. Table 3 summarizes the increase in test costs expected from 

increased annual Phase I testing. The estimates assume 100 percent District observation. 

According to compliance staff, District observation of reverification tests is close to 100 percent. At 

this rate, balance system reverification test costs will increase about 14 percent countywide, from 

$169,028 to $192,068 per year. On an annual per station basis, balance station costs increase about 16 

percent, from $1,490 per year to $1,730 year. 

For vacuum assist systems at a 100 percent observa-tion rate, annual countywide costs increase 19.5 

percent to $145,530 per year. On an annual per station basis, costs increase the same percentage to 

$1,470. While the testing company will charge for the additional Phase I EVR tests, no additional 

travel or per-diem fees is expected because Phase II testing will occur at the same time. Staff 

considers the increases noted in Table 3 to be reasonable. 
FINAL STAFF REPORT - Rule 70 Page 23 

March 2, 2009 

Details from the analysis of current and future reverification test costs for both balance and vacuum 

assist systems appears in Appendix 4. The chart presents costs on an annual per-station and countywide basis. As noted above, balance systems with a thoughput of less than 100,000 gallons per year 

will not change. Full Phase I EVR implementation is required by April, 2009. 

Table 2 

Cost Assumptions 

Balance Test Cost District Cost

Static $250 $210

Dynamic $250 $150

Liquid Remove $30 per nozzle $150

Phase I Tank 1 $70 $150

Phase I Tank 2 $70 $0

Phase I Tank 3 $70 $0

Vacuum Assist Test Cost District Cost

Static $250 $210

Wet Air / Liquid $500 $150

Phase I Tank 1 $70 $150

Phase I Tank 2 $70 $0

Phase I Tank 3 $70 $0

Table 3 

Average Reverification Test Cost Annual Summary 

At 100% District Test Observation 

 Balance Systems Each Station Countywide 

 Existing 

>=100,000 

Revised 

>=100,000 

Existing 

<100,000 

Revised 

<100,000 

Existing Revised 

Testing $930.00 $1,070.00 $347.50 $347.50 $104,918 $118,358 

District 

Observation $560.00 $660.00 $230.00 $230.00 $64,110 $73,710 

Total $1,490.00 $1,730.00 $557.50 $557.50 $169,028 $192,068 

Increase (%) 16.1 0.00 13.6 

Vacuum Assist Systems

Each Station Countywide 

Existing Revised Existing Revised 

Testing $820.00 $960.00 $81,180 $95,040 

District 

Observation $410.00 $510.00 $40,590 $50,490 

Total $1,230.00 $1,470.00 $121,770 $145,530 

Increase (%) 19.5 19.5 
FINAL STAFF REPORT - Rule 70 Page 24 

March 2, 2009 

Analysis for Increasing Phase I VR Testing from 

Every 3 Years to Annual 

(August 19, 2008) 

>=100,000 gal/yr Countywide Per Station Countywide Per Station 

Balance Stations - Old 96 Test/yr Cost/Yr Cost/Yr 1 District Dist/Yr Dist/Yr 1 

Annual Static 96 $24,000.00 $250.00 $210 $20,160 $210 

Annual Dynamic 96 $24,000.00 $250.00 $150 $14,400 $150 

12 Nozzles LR 1152 $34,560.00 $360.00 $150 $14,400 $150 

Regular - 3 years Phase I 32 $2,240.00 $23.33 $150 $4,800 $50 

Mid-Grade - 3 years Phase I 32 $2,240.00 $23.33 $0 $0 $0 

Supreme - 3 years Phase I 32 $2,240.00 $23.33 $0 $0 $0 

 1,440 $89,280.00 $930.00 $660.00 $53,760 $560.00 

 

Balance Stations - New 96 Test/yr Cost/Yr Cost/Yr 1 District Dist/Yr Dist/Yr 1 

Annual Static 96 $24,000.00 $250.00 $210 $20,160 $210 

Annual Dynamic 96 $24,000.00 $250.00 $150 $14,400 $150 

12 Nozzles LR 1,152 $34,560.00 $360.00 $150 $14,400 $150 

Regular - Annual Phase I 96 $6,720.00 $70.00 $150 $14,400 $150 

Mid- Grade - Annual Phase I 96 $6,720.00 $70.00 $0 $0 $0 

Supreme - Annual Phase I 96 $6,720.00 $70.00 $0 $0 $0 

 1,632 $102,720.00 $1,070.00 $660.00 $63,360 $660.00 

 

<100,000 gal/yr Countywide Per Station Countywide Per Station 

Balance -Stations - Old 45 Test/yr Cost/Yr Cost/Yr 1 District Dist/Yr Dist/Yr 1 

Every 2 years Static 22.5 $5,625.00 $125.00 $210 $4,725 $105 

Every 4 years Dynamic 11.25 $2,812.50 $62.50 $150 $1,688 $38 

12 Nozzles LR 135 $4,050.00 $90.00 $150 $1,688 $38 

Regular - 3 years Phase I 15 $1,050.00 $23.33 $150 $2,250 $50 

Mid-Grade - 3 years Phase I 15 $1,050.00 $23.33 $0 $0 $0 

Supreme - 3 years Phase I 15 $1,050.00 $23.33 $0 $0 $0 

 214 $15,637.50 $347.50 $660.00 $10,350 $230.00 

 

Balance Stations - NEW 45 Test/yr Cost/Yr Cost/Yr 1 District Dist/Yr Dist/Yr 1 

Every 2 years Static 22.5 $5,625.00 $125.00 $210 $4,725 $105 

Every 4 years Dynamic 11.25 $2,812.50 $62.50 $150 $1,688 $38 

12 Nozzles LR 135 $4,050.00 $90.00 $150 $1,688 $38 

Regular - 3 years Phase I 15 $1,050.00 $23.33 $150 $2,250 $50 

Mid-Grade - 3 years Phase I 15 $1,050.00 $23.33 $0 $0 $0 

Supreme - 3 years Phase I 15 $1,050.00 $23.33 $0 $0 $0 

 214 $15,637.50 $347.50 $660.00 $10,350 $230.00 

 

Balance - Countywide Old Total $104,917.50 $64,110.00 

 New Total $118,357.50 $73,710.00 
FINAL STAFF REPORT - Rule 70 Page 25 

March 2, 2009 

Countywide Per Station Countywide Per Station 

Vapor Assist Old 99 Test/yr Cost/Yr Cost/Yr 1 District Dist/Yr Dist/Yr 1 

Annual Static 99 $24,750.00 $250.00 $210 $20,790 $210 

Annual (Wet A/L every 

4th yr) W A/L 99 $49,500.00 $500.00 $150 $14,850 $150 

Regular – 3 years Phase I 33 $2,310.00 $23.33 $150 $4,950 $50 

Mid-Grade - 3 years Phase I 33 $2,310.00 $23.33 $0 $0 $0 

Supreme - 3 years Phase I 33 $2,310.00 $23.33 $0 $0 $0 

 297 $81,180.00 $820.00 $510.00 $40,590 $410.00 

 

Vapor Assist New 99 Test/yr Cost/Yr Cost/Yr 1 District Dist/Yr Dist/Yr 1 

Annual Static 99 $24,750.00 $250.00 $210 $20,790 $210 

Annual W A/L 99 $49,500.00 $500.00 $150 $14,850 $150 

Regular - Annual Phase I 99 $6,930.00 $70.00 $150 $14,850 $150 

Mid- Grade - Annual Phase I 99 $6,930.00 $70.00 $0 $0 $0 

Supreme - Annual Phase I 99 $6,930.00 $70.00 $0 $0 $0 

 495 $95,040.00 $960.00 $510.00 $50,490 $510.00