[Federal Register Volume 62, Number 46 (Monday, March 10, 1997)]
[Rules and Regulations]
[Pages 10690-10700]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-5765]


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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Parts 52 and 81

[CO-001-0011; CO-001-0012; CO-001-0013; CO-001-0014; FRL-5692-3]


Clean Air Act Approval and Promulgation of State Implementation 
Plan for Colorado; Carbon Monoxide Attainment Demonstrations and 
Related SIP Elements for Denver and Longmont; Clean Air Act 
Reclassification; Oxygenated Gasoline Program

AGENCY: Environmental Protection Agency (EPA).

ACTION: Final rulemaking.

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SUMMARY: In this document, EPA is approving the State Implementation 
Plan (SIP) revisions submitted by the State of Colorado for the purpose 
of bringing about the attainment of the national ambient air quality 
standards (NAAQS) for carbon monoxide (CO). The implementation plan 
revisions were submitted by the State on July 11 and 13, 1994, 
September 29, 1995, and December 22, 1995 to satisfy certain Federal 
requirements for an approvable nonattainment area CO SIP for Denver and 
Longmont. This action includes approval of revisions to Colorado 
Regulations 11 (vehicle inspection and maintenance (I/M)) and 13 
(oxygenated fuels) submitted to satisfy conditions in the SIP, and 
further revisions to Regulation 13 to shorten the effective period of 
the oxygenated fuels program. It also includes reclassification of the 
Denver CO nonattainment area from Moderate to Serious. EPA proposed to 
approve the July 1994 and September 1995 SIP submissions and to 
reclassify the Denver area to Serious in the Federal Register on July 
9, 1996. EPA published a supplemental proposal to approve the December 
22, 1995 SIP submission shortening the oxygenated fuels program period 
and to approve the Denver and Longmont CO SIPs based on the shortened 
period on December 6, 1996. The rationale for the final approvals and 
reclassification are set forth in this document. Additional information 
is available at the address indicated below.

EFFECTIVE DATE: This action is effective on April 9, 1997.

ADDRESSES: Copies of the State's submittals and other information are 
available for inspection during normal business hours at the following 
locations: Environmental Protection Agency, Region VIII, Air Programs, 
999 18th Street, 3rd Floor, South Terrace, Denver, Colorado 80202-2466; 
and Colorado Air Pollution Control Division, 4300 Cherry Creek Dr. 
South, Denver, Colorado 80222-1530.

FOR FURTHER INFORMATION CONTACT: Jeff Houk at (303) 312-6446.

SUPPLEMENTARY INFORMATION:

I. Background

    The air quality planning requirements for CO nonattainment areas 
are set out in sections 186-187 of the Clean Air Act (Act) Amendments 
of 1990 (CAAA) which pertain to the classification of CO nonattainment 
areas and to the submission requirements of the SIPs for these areas, 
respectively. The EPA has issued a ``General Preamble'' describing 
EPA's preliminary views on how EPA intends to review SIPs and SIP 
revisions submitted under Title I of the Act, [see generally 57 FR 
13498 (April 16, 1992) and 57 FR 18070 (April 28, 1992)]. Because EPA 
is describing its interpretations here only in broad terms, the reader 
should refer to the General Preamble for a more detailed discussion of 
the interpretations of Title I advanced in today's rulemaking action. 
In today's action on the Denver and Longmont CO SIPs, EPA is applying 
its interpretations taking into consideration the specific factual 
issues presented and comments received from the public.
    This Federal Register document addresses several requirements of 
the 1990 CAAA which were required to be submitted no later than 
November 15, 1992, and which the State did not

[[Page 10691]]

submit by that date. These requirements include an attainment 
demonstration, contingency measures and, for Denver, a vehicle miles 
travelled forecasting and tracking program and transportation control 
measures. EPA made a formal finding that the State had failed to submit 
these SIP revisions in a letter to Governor Roy Romer dated January 15, 
1993. This Federal Register document also addresses revisions to 
Regulations 11 and 13, submitted by the State of Colorado to implement 
portions of the control strategy relied upon by the attainment 
demonstration.
    Section 187(a)(7) required those States containing CO nonattainment 
areas with design values greater than 12.7 parts per million (ppm) to 
submit, among other things, an attainment demonstration by November 15, 
1992, demonstrating that the plan will provide for attainment by 
December 31, 1995 for Moderate CO nonattainment areas and December 31, 
2000 for Serious CO nonattainment areas. The attainment demonstration 
must include a SIP control strategy, which is also due by November 15, 
1992. The SIP control strategy for a given nonattainment area must be 
designed to ensure that the area meets the specific annual emissions 
reductions necessary for reaching attainment by the deadline. In 
addition, section 187(a)(3) requires these areas to implement 
contingency measures if any estimate of actual vehicle miles travelled 
(VMT) or any updated VMT forecast for the area contained in an annual 
report for any year prior to attainment exceeds the number predicted in 
the most recent VMT forecast. Contingency measures are also triggered 
by failure to attain the NAAQS for CO by the attainment deadline. 
Contingency measures must be submitted with the CO SIP by November 15, 
1992. Finally, a vehicle miles travelled forecasting and tracking 
program is required by Section 187(a)(2)(A), and transportation control 
measures are required for Denver by Section 187(a)(2)(B). These 
requirements are discussed in more detail in EPA's July 9, 1996 (61 FR 
36004) and December 6, 1996 (61 FR 64647) Federal Register documents 
proposing action on the SIP revisions.
    Longmont had been designated as unclassifiable/attainment prior to 
passage of the 1990 CAAA. However, a special monitoring study in 1988-
89 recorded an exceedance of the NAAQS in Longmont. As a result, EPA 
Region VIII recommended that the Governor designate this area 
nonattainment, and on March 15, 1991, the Governor submitted a 
nonattainment designation for this area that was later codified by EPA 
at 40 CFR Part 81. Longmont was classified as a Moderate area in 40 CFR 
Part 81. Since this area had never had a SIP, EPA interpreted Section 
172 of the Act to require an attainment demonstration for Longmont. 
Contingency measures under Section 172(c)(9) were also required. On 
January 15, 1993, EPA made a formal finding that the State had failed 
to submit these SIP revisions for Longmont.
    On July 11, 1994 and July 13, 1994, Governor Roy Romer submitted 
comprehensive revisions to the Colorado SIP. The carbon monoxide SIP 
element submittals for Denver and Longmont addressed the outstanding 
CAAA requirements discussed above, as well as other CAAA mandates.
    The State submitted revisions to Regulations 11 and 13 on September 
29, 1995, to implement the I/M and oxygenated fuels program revisions 
committed to in the CO SIP. EPA proposed approval of these revisions in 
its July 9, 1996 Federal Register document, and is today taking final 
action to approve these revisions.
    The State submitted additional revisions to Regulation 13 on 
December 22, 1995, shortening the effective period of the oxygenated 
fuels program. EPA published a Federal Register document on December 6, 
1996, proposing approval of these revisions and re-proposing approval 
of the Denver and Longmont CO SIPs to provide an opportunity for public 
comment on the impact of this revision to Regulation 13 on the CO SIPs. 
EPA is today taking final action to approve the revisions to Regulation 
13 that the State submitted on December 22, 1995.

II. Response to Public Comments

    EPA received numerous comments on its proposed approval of the 
Denver CO SIP and the proposed reclassification of Denver from Moderate 
to Serious for CO. No comments were received specifically regarding the 
Longmont CO SIP. EPA received one set of comments regarding its 
proposed approval of the shortening of the effective period of the 
oxygenated fuels program. The comments and EPA's responses follow.

Extension of the Comment Period

    Several parties requested that EPA extend its comment period on the 
proposed approval of the SIP to allow more time for the preparation and 
submission of comments. In response to these requests, EPA extended the 
comment period for an additional 30 days (see 61 FR 43501, August 23, 
1996).

Legality of the SIP Submission Under State Law

    Several parties commented that EPA should return the Denver CO SIP 
to the State without action, because it was submitted to EPA in 
conflict with the requirements of State law. These comments generally 
concern the nature of the Air Quality Control Commission's (AQCC's) 
submission of the SIP to Legislative Council for review, and the AQCC's 
and the Governor's response to Legislative Council's actions.
    EPA's acceptance of the SIP through its July 14, 1994 determination 
of SIP completeness was based on the June 30, 1994 letter from the 
State Attorney General's Office submitted with the SIP. This letter 
certifies that the SIP was adopted and submitted in compliance with 
State law. Specifically, Section 25-7-133, C.R.S., required the 
submission of SIPs ``regarding the regulation of mobile sources'' to 
Legislative Council for review 45 days prior to submission to EPA. The 
CO SIP arguably did not fall within this criterion, as it did not 
include any regulatory content regarding mobile sources. Revisions to 
Regulations 11 and 13 (I/M and oxygenated fuels programs) to implement 
the provisions of the CO SIP were discussed in the SIP, but were not 
adopted or submitted with it. These revisions were adopted later in 
1994 by the AQCC, received full Legislative Council review and were 
submitted to EPA in September 1995. Nevertheless, the AQCC chose to 
submit the CO SIP to Legislative Council for review even though it did 
not contain any mobile source regulation revisions.
    The June 30, 1994 letter from the AG's office concedes that the SIP 
was not submitted to Legislative Council 45 days prior to submittal to 
EPA, but notes that the Council acted on the SIP at its June 21, 1994 
meeting and, in effect, waived the 45 day requirement. Also, according 
to the June 30, 1994 letter, the actions by Legislative Council at its 
meeting were not fully in compliance with State law:
    ``The Council may act in one of two ways: it can return the SIP in 
its entirety and it is then deemed approved, or it can submit it to the 
General Assembly (via petition for special session if the General 
Assembly is not in session)* * * The Legislative Council, on June 21, 
1994 took action by motion, wherein it voted to postpone review of the 
CO SIP submission, voted to return the plan for revisions by the 
Commission, and voted to conduct a final review no later than January 
15, 1995. Pursuant to statute, because no special assembly was called 
by the

[[Page 10692]]

Council [the General Assembly was not in session], the SIP is deemed 
returned and approved.''
    EPA finds the State Attorney General's Office's interpretation 
reasonable, and thus, EPA accepts that Office's conclusion that the SIP 
was, in fact, submitted to EPA for action in compliance with State law.

Oxygenated Fuels Program

    Several comments were received with respect to the oxygenated fuels 
program. These comments and EPA's responses follow.
    (1) The submission violates Section 25-7-105.1, C.R.S., which 
states that any regulation that is more stringent than Federal law 
shall not constitute part of a state implementation plan.
    Putting aside for the purposes of this response the question of 
what EPA's role should be with respect to this State law, EPA does not 
believe that the 3.1% oxygenated fuels program is more stringent than 
is required under the Act. First, EPA does not believe section 211(c) 
of the Act preempts the State from requiring a 3.1% minimum oxygen 
content standard and, thus, does not believe a finding of necessity is 
required under section 211(c)(4)(C) of the Act (see discussion in 
response to comment 6 below). Second, the State is relying on the 3.1% 
oxygenated fuels program as one measure to help demonstrate attainment 
of the NAAQS for CO, as required by sections 110(a) and 187(a)(7) of 
the Act. Without the 3.1% oxygenated fuels program, the SIP would be 
unable to demonstrate attainment of the NAAQS. Thus, the 3.1% 
oxygenated fuels program is not more stringent than the Act requires.
    (2) Subsequent to AQCC adoption of the CO SIP, the AQCC adopted 
revisions to Regulation 13 which shortened the control period during 
which the oxygenated fuels program is in effect. EPA's approval of the 
CO SIP does not address this revision.
    Based on this comment, EPA reproposed approval of the Denver and 
Longmont CO SIPs, incorporating the shortened oxygenated gasoline 
season, and also proposed approval of the revisions to Regulation 13 
shortening the season (see 61 FR 64647, December 6, 1996). EPA is now 
approving the shortening of the oxygenated gasoline season and is 
approving the Denver and Longmont CO SIPs based on the shortened 
season.
    (3) EPA approval of the 3.1% oxygenated fuels program would be 
contrary to Exxon Corp. v. City of New York, 548 F.2d 1088 (2nd Cir. 
1977).
    The Exxon v. City of New York decision was based on pre-1990 CAA 
language, EPA regulations that have since been amended, and in part, 
different factual circumstances that bear no relevance to the situation 
here. Moreover, the changes in section 211(c)(4) and the 40 CFR Part 80 
fuel regulations since the Exxon decision directly modify the 
provisions that the court relied on in a way that limits the scope of 
preemption of state fuel controls. Thus, this decision is not relevant 
to the current situation.
    In Exxon Corp. v. City of New York, the court found that New York 
City's lead and volatility regulations were preempted under section 
211(c)(4). In the Part 80 regulations, EPA had set out the federal fuel 
requirements and stated that they prescribed regulations for the 
control and/or prohibition of fuels and additives. EPA also had 
promulgated specific lead regulations, less stringent than the New York 
City regulations, but did not address volatility. At the time of the 
court's decision, section 211(c)(4) preempted ``any control or 
prohibition respecting use of a fuel or fuel additive.'' The court 
found that EPA had promulgated regulations respecting the use of fuels, 
and thus, New York City's more stringent regulations were preempted.
    In the 1990 CAAA, Congress amended the language of section 
211(c)(4) to preempt ``any control or prohibition respecting any 
characteristic or component of a fuel or fuel additive.'' After the 
court's decision, EPA also modified the Part 80 regulations to make it 
clear that they are not intended to preempt states' ability to regulate 
fuels and fuel additives that EPA has not addressed. Section 80.1(b) 
states: ``Nothing in this part is intended to preempt the ability of 
State or local governments to control or prohibit any fuel or additive 
for use in motor vehicles and motor vehicle engines which is not 
explicitly regulated by this part.'' Thus, both Congress and the Agency 
have clearly indicated that EPA's fuel requirements do not preempt 
states from regulating a specific characteristic or component that the 
Agency has not addressed. As discussed below, there are no federal 
regulations applicable to oxygen content in the Denver area, and hence 
Exxon v. City of New York is not applicable here.
    (4) EPA approval of the 3.1% oxygenated fuels program could lead to 
oxygenate shortages which could interfere with the federal reformulated 
gasoline program.
    During the two winter seasons since the CO SIP was submitted to 
EPA, the average oxygen content in Denver has been well above 3.1%. The 
federal reformulated gasoline program took effect on January 1, 1995, 
and thus has been in effect coincident with the Denver oxygenated fuels 
program for over two years. No documented oxygenate shortages have 
occurred as a result of Denver's program. Furthermore, the commentor 
did not provide any indication that a change in circumstances may occur 
that could produce any problems in the future.
    (5) EPA approval of the 3.1% oxygenated fuels program could lead to 
an increase in NO<INF>X emissions, which could jeopardize public health 
by increasing ozone concentrations.
    Several parties have contacted EPA in the past with regard to 
potential NO<INF>X increases from use of oxygenated fuels. No good 
scientific information exists that conclusively documents an increase 
in fleet NO<INF>X emissions from use of oxygenated fuels. The 
laboratory studies to date have generally had poor control of other 
fuel characteristics that affect NO<INF>X emissions, making the results 
unreliable.
    Increases in NO<INF>X emissions from the use of oxygenates would 
not be expected to generate exceedances of the ozone NAAQS, as asserted 
by the commentor. Oxygenate use is only required during the winter 
season, when climatic conditions are not favorable to the formation of 
tropospheric (ground-level) ozone. No exceedances of the ozone NAAQS 
have occurred at any time during the ten winter seasons in which 
oxygenated fuels have been used in the Denver area.
    (6) The 3.1% oxygen content is higher than is necessary to attain 
the CO NAAQS, and other reasonable, practicable means of attainment are 
available, so EPA cannot approve this program under section 
211(c)(4)(C) of the CAA. Moreover, section 211(m) provisions occupy the 
field for regulation of oxygen content of gasoline and thereby preempt 
any different regulation by a state.
    Section 211(c)(4)(C) provides that states are preempted from 
regulating motor vehicle fuels where EPA has already acted, either to 
regulate the fuel or to find that no regulation is necessary. If 
preemption applies, the state may regulate the fuel only if EPA finds 
the state requirement necessary to achieve the NAAQS for the relevant 
pollutant. Here, EPA has neither regulated fuel oxygen content in 
Colorado nor made a finding that no such regulation is necessary. 
Therefore, the state regulation is not preempted and there is no need 
to find necessity. In the absence of federal preemption, states are 
free to regulate to control air pollution, and EPA must approve lawful 
state requirements into SIPs, as long as

[[Page 10693]]

the state submission meets all applicable requirements under Title I of 
the Act.
    Section 211(c)(4)(A) preempts a state from ``prescrib[ing] or 
attempt[ing] to enforce * * * any control or prohibition respecting any 
characteristic or component of a fuel or fuel additive'' under two 
circumstances. Section 211(c)(4)(A)(i) provides for preemption if EPA 
has found that no control or prohibition of the characteristic is 
necessary and has published that finding in the Federal Register. 
Section 211(c)(4)(A)(ii) provides that a state is preempted from 
regulating if EPA has prescribed under section 211(c)(1) a control or 
prohibition applicable to such characteristic or component, unless the 
state control or prohibition is identical to EPA's control or 
prohibition. Thus, to preempt state regulation under 211(c)(4), either 
EPA must publish a finding that a control is unnecessary, or EPA must 
promulgate a control of the same characteristic or component under 
section 211(c)(1).
    EPA has not made any finding under section 211(c)(4)(A)(i) that 
control of fuel oxygen content is unnecessary. There is no preemption 
of the Regulation 13 requirement for a 3.1% oxygen content under this 
provision.
    The only requirement that EPA has promulgated applicable to fuel 
oxygen content under 211(c)(1) is in the reformulated gasoline (RFG) 
regulations. EPA promulgated the RFG regulations under both sections 
211(c)(1) and 211(k). However, Colorado is neither required to use RFG 
by statute, nor has it voluntarily opted into the RFG program. Thus, 
the RFG regulations do not apply in Colorado.
    The statute is ambiguous as to whether federal regulation of a fuel 
characteristic in certain areas of the country preempts state 
regulation only in those areas, or whether it preempts any state 
regulation of that characteristic nationwide. The statute simply refers 
to ``a control or prohibition applicable to such characteristic or 
component.'' The language does not indicate whether it means any 
control in any area or at any time generally applicable to a fuel 
characteristic, or a control actually applicable to a fuel 
characteristic in a given time and place. The statute is also ambiguous 
as to whether ``characteristic or component of a fuel or fuel 
additive'' should be read generally, as in ``oxygen content,'' or 
specifically, as in ``oxygen content in RFG areas.'' In delegating 
authority to the Agency to administer section 211(c), Congress has also 
implicitly delegated the authority to reasonably interpret the 
provision in light of any ambiguity. Chevron, USA v. NRDC, 467 U.S. 837 
(1984).
    EPA believes that the better reading of the statute is that 
preemption by the RFG regulations applies more narrowly, only in the 
areas where the federal RFG regulation applies. First, the RFG 
regulations arguably are not a control ``applicable'' to fuel oxygen 
content outside of RFG areas. Secondly, this interpretation is 
consistent with the judicial cannon of statutory construction by which 
courts construe preemption narrowly. Thirdly, as a policy matter, EPA's 
decision to regulate fuel oxygen content in RFG areas did not encompass 
a determination that states should not or need not regulate that 
characteristic outside of those areas. Section 211(c)(4) applies only 
where EPA has affirmatively decided to regulate a particular fuel 
characteristic or component, or has affirmatively found that no such 
regulation is necessary and has published such a finding in the Federal 
Register. The RFG rulemaking never considered whether fuel oxygen 
content requirements were needed for CO control outside RFG areas, but 
merely incorporated the statutory requirement to set a 2.0 percent 
oxygen content for RFG. Moreover, whether RFG applies to an area 
depends solely on its status as an ozone nonattainment area; its status 
for CO is irrelevant. This further reinforces the conclusion that 
oxygen content requirements under RFG do not represent any EPA or 
Congressional decision on the need for such requirements outside of RFG 
areas. Finally, the purpose of the section 211(c)(4) preemption 
provision is to strike an appropriate balance between states' ability 
to freely adopt control measures, and avoidance of a variety of 
different state standards, potentially disrupting the national motor 
vehicle fuel market and federal regulation of such fuels. This purpose 
is not served by applying preemption where there is no federal 
regulatory scheme, as here in Colorado.
    Finally, section 211(m) does not constitute federal regulation of 
oxygen content, which could occupy the field for regulation of oxygen 
content and hence preempt state regulation. Section 211(m) requires 
states with certain CO nonattainment areas to submit a SIP revision 
requiring gasoline ``to contain not less than 2.7 percent oxygen 
content by weight.'' The statute requires state regulation, not 
federal, and explicitly sets a minimum standard for such state 
regulation, leaving the state free to adopt more stringent requirements 
if it so chooses. There is no indication in the statute or the 
legislative history that by specifying a minimum oxygen level that 
states should require, Congress intended the federal government to 
occupy the field of oxygen content regulation and preempt states from 
establishing a more stringent standard.
    Because the federal RFG fuel oxygen content provision does not 
apply to Colorado, section 211(c)(4) does not preempt the state from 
promulgating its own average fuel oxygen content standard of 3.1%. Nor 
does section 211(m) explicitly or implicitly impose such a restriction. 
Moreover, EPA must approve into a SIP any lawful provision concerning 
control of a criteria pollutant that is submitted by a State and that 
otherwise meets the requirements of section 110. See Union Electric Co. 
v. EPA, 427 U.S. 246 (1976). Thus, Colorado was free to adopt a 3.1% 
oxygen content standard as a control strategy to help attain the CO 
NAAQS.
    (7) EPA approval of the 3.1% oxygenated fuels program in Colorado 
would be a de facto mandate that at least 50% of the gasoline in the 
Denver area contain ethanol, contrary to American Petroleum Institute 
vs. United States Environmental Protection Agency, 52 F.3d 1113 (D.C. 
Cir. 1995).
    In API v. EPA, the issue was whether EPA has the authority to 
mandate use of a particular oxygenate in RFG. The court held that EPA 
does not have such authority because Sec. 211(k) lays out the specific 
criteria that EPA is to consider in promulgating the RFG requirements, 
and the ethanol mandate was not established pursuant to those criteria. 
This holding has no relevance for whether a state, rather than EPA, 
could directly mandate use of a particular oxygenate. Moreover, the 
state here has not mandated use of any particular oxygenate. It has 
merely established oxygen content requirements, and the industry may 
use any oxygenate capable of meeting those requirements, subject to the 
maximum blending restrictions. In addition, these are the same oxygen 
content requirements as the CAA mandates for certain areas, which 
indicates that Congress contemplated that such higher oxygen content 
levels may be needed in some areas. In the absence of federal 
preemption, states are free to adopt fuel controls for emission 
reductions. API identifies no additional limit on EPA's authority to 
approve such state requirements in SIPs.
    (8) Recent studies have demonstrated that oxygenated fuels have 
little or no effect on CO air quality. EPA should facilitate an 
independent review of the impacts of oxygenated fuels on CO air quality 
before acting to approve the CO SIP.

[[Page 10694]]

    The White House Office of Science and Technology Policy (OSTP) has 
recently issued a draft report on oxygenated fuels, which compiles the 
results of a number of other studies (``Interagency Assessment of 
Oxygenated Fuels,'' September 1996). While not yet final, the draft 
report concludes that oxygenated fuels produce approximately a 10.0% to 
13.5% ambient CO reduction benefit. The National Academy of Sciences 
(NAS) has also issued a recent report commenting on the OSTP report. 
The NAS report found that oxygenated fuels programs have a benefit of 
zero to 10 percent in reducing ambient CO. Of the 10 existing ``real 
world'' studies of oxygenated fuels' ambient air impacts cited in the 
NAS report, eight show a statistically significant benefit from the 
program, and two studies (both in North Carolina) showed no significant 
benefit or did not attempt to quantify a benefit. Likewise, virtually 
all laboratory studies of oxygenated fuels, including some conducted by 
the automotive and petroleum industries, show a significant carbon 
monoxide reduction at the tailpipe from use of these fuels.
    EPA recently conducted an analysis of carbon monoxide air quality 
data from cities around the country (``Impact of the Oxyfuel Program on 
Ambient CO Levels,'' J. Richard Cook et al, EPA420-R-96-002). In this 
report, EPA compared data from a number of cities which used oxygenated 
fuels beginning in the winter of 1992-93 to data from several cities 
which did not. Using this approach, EPA found an immediate and 
sustained reduction of carbon monoxide concentrations in the range of 
3.1% to 13.6% in cities using oxygenated fuels, in excess of the 
reductions expected from new cars entering the fleet. This reduction 
was not seen in cities not using oxygenated fuels. This level of 
benefit is consistent with that found in other studies. A subsequent 
regression modeling analysis by Dr. Gary Whitten of SAI of ambient CO 
data in oxygenated fuels areas (``Regression Modeling of Oxyfuel 
Effects on Ambient CO Concentrations,'' SYSAPP-96/78, January 8, 1997) 
found a 14% reduction in ambient CO concentrations due to 
implementation of the program.
    These analyses are significant because they are based on 
measurements of actual air quality data in these cities over at least 
two winter periods. Many interested parties have criticized laboratory 
studies as not being representative of the real world; however, in 
attempting to carry out a ``real world'' study in a single urban area, 
it is very difficult to separate the influence of oxygenated fuels from 
all of the other factors that affect carbon monoxide concentrations 
(including weather, congestion, and changes in the mix of cars and 
trucks in the fleet).
    The National Academy of Science's report points out some areas 
where additional research would be useful, and EPA and the State are 
working to design a study to address some of the uncertainties 
surrounding the use of oxygenated fuels. However, the NAS report and 
the available scientific data support continuing the oxygenated fuels 
program.
    While not a factor in EPA's decision, readers may be interested to 
know that oxygenated fuels is one of the least expensive carbon 
monoxide control strategies available. In terms of dollars per ton of 
pollution eliminated, it is much cheaper than other alternatives, such 
as transportation control measures, mandatory employee trip reduction, 
conversion of vehicles to run on alternative fuels like propane or 
natural gas, or industrial controls. The program also serves as an 
important defense against factors that increase carbon monoxide 
emissions in the Denver area, including growth in daily vehicle miles 
travelled, growth in the amount of time that vehicles spend in 
congestion, and growth in the number of sport utility vehicles and 
other types of higher-emitting light-duty trucks on the road. EPA has 
substantial evidence at this time that oxygenated fuels are an 
effective means to control carbon monoxide, and hence it is appropriate 
to approve this provision of the CO SIP at this time.

Shortening of the Oxygenated Fuels Season

    One party submitted comments in response to EPA's December 6, 1996 
supplemental notice of proposed rulemaking, proposing approval of the 
revisions to Regulation 13 removing the last two weeks of the 
oxygenated fuels season and reproposing approval of the CO SIPs to 
incorporate this revision. This commentor supported EPA's action to 
approve the shortening of the oxygenated fuels season. The commentor 
also raised other issues with respect to the oxygenated fuels program 
which have been addressed above.

Abandoned and Impounded Vehicle Program

    One commentor expressed concern that the SIP provision preventing 
re-registration of abandoned or impounded pre-1982 vehicles would 
negatively impact the collector car industry of the Denver region and 
would prevent owners from recovering stolen vehicles. Another commentor 
expressed concern that this program would unnecessarily harm lower-
income individuals and artificially increase demand for new cars. While 
EPA understands these concerns, the Act prohibits EPA from basing its 
actions concerning SIPs on considerations involving the economic 
reasonableness of State actions. See Union Electric Co. v. EPA, 427 
U.S. 246, 256-266 (1976); 42 U.S.C. section 7410(a)(2).
    While EPA is prohibited from basing its action on the SIP on 
economic grounds, EPA has concluded for other reasons that it should 
not act on this element of the SIP. The provision is not well-defined 
in the SIP, with the design and implementation of this program left up 
to the discretion of local jurisdictions, and no credit was taken for 
this measure in the attainment demonstration (see SIP page IX-4). 
Therefore, EPA is not taking action on this element of the SIP.

Revised Emissions Standards for Pre-1982 Vehicles

    One commentor stated that the requirement for tighter emissions 
testing cutpoints for pre-1982 was arbitrary and capricious, and unduly 
impacted owners of these model year vehicles in the Denver region. 
Again, EPA is prohibited by law from basing its actions on SIPs on 
considerations involving the economic reasonableness of State actions. 
However, pre-1982 vehicles were targeted for tighter cutpoints because 
1982 and newer vehicles are already subject to the more stringent 
provisions of the enhanced vehicle inspection and maintenance program. 
Tighter cutpoints for pre-1982 vehicles should result in more high-
emitting vehicles being identified and repaired through the 
requirements of Regulation 11. Data from the enhanced I/M program show 
that the average older vehicle emits carbon monoxide at levels many 
times higher than the level at which they were certified for sale. 
However, there is no presumption that all older vehicles are high 
emitters, and vehicles in good operating condition should not fail the 
tighter cutpoints.
    This commentor also stated that the State and EPA had failed to 
consider the smaller proportion of total VMT generated by pre-1982 
vehicles. The mobile source emissions modeling conducted for the SIP is 
based on estimates of annual mileage accumulation and share of daily 
VMT for each model year. Thus, the SIP modeling inputs reflect the 
smaller proportion of total VMT generated by pre-1982 vehicles. While 
it is true that pre-1982 vehicles do represent a relatively small 
proportion of total

[[Page 10695]]

regional VMT, emissions generated by these vehicles are still 
significant because these vehicles are required to meet less stringent 
emissions standards by the State and EPA, and thus, per-vehicle 
emissions are higher. The SIP estimates that this measure would provide 
a CO emission reduction benefit of 20 tons per day in 1995. EPA 
believes the estimates of pre-1982 VMT share and emissions reductions 
from the SIP provision are reasonable.
    Another commentor stated that EPA should give the State the option 
of eliminating the I/M program and the prohibition on re-registration 
of abandoned and impounded vehicles in favor of an enforceable system 
of user fees or other economic incentives that would address the actual 
contribution of individual vehicles and drivers to the region's 
pollution problems. The Clean Air Act requires the State to implement 
an enhanced I/M program that meets certain minimum requirements. 
However, the Act would allow the State to revise its SIP at any time to 
add the type of program mentioned by the commentor, as long as the 
program meets the SIP requirements of Section 110. EPA does not have to 
take any type of action in order to enable the State to develop and 
submit this type of SIP revision. As noted above, EPA is not acting on 
the SIP provision that prohibits re-registration of abandoned and 
impounded vehicles.

Transportation Control Measures (TCMs)

    One commentor felt that EPA's description of the relationship of 
the TCMs to the SIP as a whole was unclear. This commentor felt that 
EPA was interpreting the SIP to incorporate the TCMs as part of the 
attainment demonstration, in addition to incorporating the TCMs as 
contingency measures.
    Further review of the SIP confirms that the TCMs are only meant to 
be incorporated as contingency measures. This intent is clearly stated 
in the SIP on pages VI-3 and X-1. The SIP states the intent of the area 
to implement the contingency measures early, as allowed by EPA policy, 
to obtain additional emission reductions. Chapter XII of the SIP, 
Attainment Demonstration, clearly demonstrates that these measures are 
not necessary for the Denver area to attain the CO NAAQS by December 
31, 2000. Thus, EPA is clarifying that the TCMs are intended to be 
enforceable provisions of the SIP only as contingency measures, with 
implementation required only in the event that the contingency measures 
are triggered (through the mechanisms discussed in the proposal). The 
State has made an adequate showing that TCMs are not needed for 
attainment, as required by section 187(a)(2)(B) of the Act.
    Another commentor stated that the requirements of the Act for TCMs 
in Denver had not been met. EPA believes that the State and the 
Regional Air Quality Council have correctly interpreted the Act's 
requirements for TCMs, that the TCM provisions of the SIP are adequate, 
and that the SIP contains an adequate showing that TCMs are not 
necessary for attainment.
    This commentor also stated that EPA should require annual reporting 
on the effectiveness and implementation of TCMs and other control 
strategies. EPA notes that periodic reporting is already required for a 
number of control measures and does not believe that further reporting 
is necessary at this time. For example, the Act requires annual 
reporting of VMT and a comparison of actual VMT with the SIP forecasts. 
The State has complied with these requirements. The Act and EPA's 
transportation conformity rule (58 FR 62188, November 24, 1993) also 
require that the Denver Regional Council of Governments (DRCOG) report 
on the implementation status of TCMs each time a conformity 
determination is made, and prohibit conformity findings if TCMs are not 
being implemented as required by the SIP. The State also produces 
annual reports on the effectiveness of the SIP's two major control 
strategies, the I/M and oxygenated fuels programs, as required by State 
law. EPA's I/M regulations (40 CFR Part 51, Subpart S) also require 
periodic evaluation of and reporting on the effectiveness of the I/M 
program.

Contingency Measures

    One commentor stated that the SIP does not contain adequate 
contingency measures, and that EPA should require the State to 
implement the contingency measures based on the Denver area's failure 
to attain. This commentor also stated that it was insufficient for the 
SIP to describe existing conditions as contingency measures which have 
already been implemented.
    As discussed in the proposal (61 FR 36009, July 9, 1996), the SIP 
TCMs exceed the minimum emission reductions established in EPA 
guidance, and EPA considers these measures adequate. Although the State 
has chosen to voluntarily implement many of the contingency measures, 
and thus obtain the benefits of early emissions reductions, the 
commentor is correct that EPA is not requiring the State to implement 
the contingency measures in the SIP based on the area's failure to 
attain the standard by the end of 1995. EPA believes it is neither 
necessary nor appropriate to do so. This is because EPA's approval of 
this Serious area CO SIP, which the State has been implementing since 
1994, obviates the need for Moderate area contingency measures. 
Contingency measures for a Moderate CO nonattainment area with a design 
value greater than 12.7 ppm are intended to provide emissions 
reductions while the State revises its SIP to meet Serious area SIP 
requirements. Here the State has already submitted a Serious area SIP 
that demonstrates attainment of the CO standard by the end of 2000, and 
EPA is approving it.
    In addition, there is no EPA-approved Moderate area CO SIP for the 
Denver area on which EPA can base a requirement that the State 
implement contingency measures for the failure to attain the CO 
standard by the end of 1995. If an EPA-approved Moderate area CO SIP 
had been in place at the time the area violated the CO standard in 
1995, EPA would have required the State to implement the contingency 
measures contained in that SIP. In the Serious area SIP that the State 
has submitted and that EPA is approving today, contingency measures are 
tied to the 2000 attainment date. There is no basis or necessity for 
EPA to require the State to implement contingency measures based on the 
area's failure to attain the CO standard by the end of 1995.
    The SIP envisions that the TCMs identified as contingency measures 
will be implemented early. This is acceptable to EPA. EPA policy 
(August 13, 1993 memorandum from G.T. Helms to regional Air Branch 
Chiefs entitled ``Early Implementation of Contingency Measures for 
Ozone and Carbon Monoxide Nonattainment Areas'') encourages the early 
implementation of contingency measures for the additional emission 
reductions and progress toward attainment that they provide. EPA 
believes that requiring states to adopt additional contingency measures 
to replace measures that were implemented early would only discourage 
early implementation and the resulting additional emission reductions.

Reclassification to Serious

    Two commentors expressed concern over EPA's proposed 
reclassification of the Denver area from Moderate to Serious for CO, 
given the small number and low absolute value of violations in recent 
years. These commentors felt that EPA should recognize Denver's 
progress toward attainment of the CO NAAQS in

[[Page 10696]]

recent years. EPA recognizes that Denver has taken significant steps to 
reduce CO levels and make progress toward attainment, including 
implementation of a comprehensive woodburning control program, the 
nation's first oxygenated fuels program, and an effective enhanced I/M 
program. However, as explained in the proposed rulemaking, the 
unambiguous provisions of the CAA and recent ambient values for CO in 
Denver compel EPA to take this action.
    One commentor stated that the SIP does not contain the elements 
required for a Serious area SIP. As discussed in detail in the 
proposal, EPA believes that the SIP does contain all required elements.

Attainment Demonstration

    One commentor submitted extensive comments on the adequacy of the 
attainment demonstration. This commentor felt that the attainment 
demonstration was inadequate because it did not consider other downtown 
intersections with the potential of experiencing high concentrations of 
CO and because growth projections used in the modeling underestimate 
the amount of growth in traffic that has occurred in the Denver area 
since the attainment demonstration was submitted to EPA.
    The State performed preliminary CAL3QHC modeling of CO 
concentrations at three intersections in the downtown area: Speer and 
Auraria Boulevard, Broadway and Colfax, and Broadway and Champa. The 
CAMP air quality/meteorology monitoring station, which has historically 
recorded the highest levels of CO in the Denver area, is located 
adjacent to the intersection of Broadway and Champa. The preliminary 
modeling results showed predicted concentrations at the Speer/Auraria 
and Broadway/Colfax intersections that were up to 6 parts per million 
(ppm) higher than concentrations predicted at the CAMP intersection. 
However, the State selected only Broadway and Champa (CAMP) for use in 
the SIP attainment demonstration because the on-site air quality and 
meteorological data available at this location provided more confidence 
in the modeling results. To ensure that higher concentrations exceeding 
the NAAQS do not occur at other downtown locations the State has 
performed supplemental CO monitoring studies at all three intersections 
and elsewhere in the Denver urban core. The results to date have 
continued to support the use of CAMP as the maximum concentration 
downtown site; CAMP continues to record higher CO design value 
concentrations than any other location in the Denver metro monitoring 
network.
    The commentor stated that EPA has not applied its modeling 
standards, guidance, and protocols consistently to the choice of 
intersections or to the attainment demonstration generally. EPA (both 
Region VIII and the national Model Clearinghouse) reviewed the State's 
analysis and found that it was consistent with national modeling policy 
and other recent Urban Airshed Model/CAL3QHC modeling applications. EPA 
believes that modeled concentrations at Speer/Auraria and Broadway/
Colfax are unreliable and therefore is not requiring the State to use 
the preliminary CAL3QHC intersection modeling results to demonstrate 
attainment at these two intersections. EPA's position is based on the 
following factors: (1) Saturation CO monitoring studies in the downtown 
area and continuous wintertime monitoring since 1994 at Speer/Auraria 
do not support the modeled predictions of higher concentrations at 
these locations; (2) estimated wind speeds at Speer/Auraria and 
Broadway/Colfax during both episodes modeled were frequently below the 
stated threshold of the CAL3QHC model and are not considered valid for 
use in the model; (3) there is a possibility that ``cold start'' 
vehicle emissions may have been overestimated at these intersections, 
artificially increasing predicted concentrations; and (4) micro-
meteorological effects of high-rise office buildings significantly 
increase modeling uncertainties at these intersections, where on-site 
meteorological data was not available.
    EPA also notes that the State followed the criteria contained in 
the Guideline for Modeling Carbon Monoxide from Roadway Intersections 
(EPA-454/R-92-005) in identifying the six busiest intersections for the 
SIP analysis. State modeling of these intersections showed compliance 
with the NAAQS. However, these intersections are all located outside of 
the downtown area; downtown is where the highest concentrations have 
historically been measured. EPA subsequently requested the State to 
model an additional intersection in the downtown urban core in order to 
assure attainment of the NAAQS. However, the State's compliance with 
this request goes beyond the usual requirements for a CO SIP attainment 
demonstration analysis.
    The commentor suggested that meteorological and other data are 
available that are more than adequate for modeling intersections other 
than CAMP. To EPA's knowledge, CAMP is the only intersection with 
representative on-site meteorology data for the periods that were 
modeled. Off-site meteorology was available at the Tivoli site for 
portions of the SIP episodes modeled, but this site is located several 
hundred meters south of the current intersection of Speer and Auraria. 
EPA reviewed the Tivoli site and determined that meteorological data 
collected at this location would not be representative of conditions at 
the intersection. Winds at the Speer and Auraria intersection would be 
affected to a far greater degree by building wake effects than the 
Tivoli site. In addition, there have been extensive changes to the 
roadway and construction of additional structures in the area since the 
Tivoli data were obtained in 1988. No data whatsoever were available 
for the Broadway and Colfax intersection.
    The commentor referred to critiques of the attainment demonstration 
developed by State staff and by outside sources. EPA has not been 
provided with and is not aware of any State or outside critiques of the 
attainment demonstration. EPA was provided with preliminary modeling 
results for the Speer and Auraria and Broadway and Colfax intersections 
by APCD staff members that were based on the Tivoli and CAMP 
meteorological/air quality data. In addition to using non-
representative data, the analysis contained a number of modeling 
assumptions that were not consistent with the EPA Guideline on Air 
Quality Models or the CAL3QHC Model Users Manual, including incorrect 
atmospheric stabilities and wind speeds lower than the acceptable 
threshold for the CAL3QHC model. The final CAL3QHC modeling submitted 
by the APCD did not contain intersection modeling for the two 
intersections where on-site data were not available. EPA concurs with 
the final modeling analysis submitted by the State. This decision is 
supported by the supplemental CO monitoring studies that have been 
performed in the downtown area. These studies support the continued use 
of CAMP as the maximum concentration downtown site.
    The commentor also suggested that EPA applied a different set of 
review criteria to the downtown intersections than to suburban sites, 
because the downtown intersections showed high CO concentrations that 
would trigger more stringent control strategies, and suggested that 
these different criteria led to high concentration intersections 
downtown being dropped from the SIP analysis. The reason the modeling 
results for the two intersections in the downtown area were dropped is 
that the CAL3QHC model could not be applied

[[Page 10697]]

appropriately given the effects of nearby downtown buildings on wind 
flow and the lack of representative on-site data. Building effects were 
not an issue at the six suburban intersections modeled in the SIP.
    The commentor implied that EPA was basing its decision to approve 
the SIP on ``voluntary'' compliance with EPA requests, 
``understandings'' between State and EPA staff, and written and 
unwritten EPA ``guidance''. The commentor suggested that EPA was 
honoring a ``deal'' that violates the letter and intent of the Act. EPA 
believes that the attainment demonstration meets the requirements of 
the Act. EPA addresses the commentor's specific concerns regarding the 
attainment demonstration in other portions of this response. EPA is not 
basing its decision to approve the SIP on any ``deals'' or improper 
``understandings'' reached with the State, but on the SIP's compliance 
with the Act. EPA does not know what the commentor is referring to when 
it writes about ``voluntary'' compliance with EPA requests. To the 
extent EPA has offered guidance to the State, EPA believes such 
guidance has been consistent with the Act or a reasonable 
interpretation of the Act.
    The commentor noted that many large projects have been planned or 
built since the attainment demonstration was submitted to EPA, and that 
newer growth projections show higher levels of traffic than those 
considered in the SIP. Two of the facilities specifically mentioned by 
the commentor (Coors Field and Elitch's) would not be expected to 
affect Denver's ability to attain the CO standard, since they are not 
operational during the winter season when the highest values of CO are 
measured in Denver. The proposed Pepsi Center, which could impact 
Denver's ability to attain the NAAQS due to its potential proximity to 
one of the downtown intersections where elevated values of CO have been 
monitored, has not been approved by the City and County of Denver, and 
there is apparently some possibility that this facility may not be 
located downtown at all. Denver is currently examining the traffic and 
air quality impacts of a wide range of potential development in the 
lower downtown area through its Central Platte Valley Multimodal Access 
and Air Quality Study.
    The comment regarding newer projections of traffic growth 
apparently refers to revised estimates of daily vehicle miles travelled 
produced by DRCOG in the summer and fall of 1996. In early 1996, DRCOG 
made some improvements to its transportation demand model (used for 
transportation planning, and to produce estimates of future VMT and 
speeds for air quality planning purposes) and validated the model with 
actual 1995 traffic counts recorded in Denver. These adjustments led to 
revised estimates of approximately 49 million miles per day of traffic 
in the Denver area (the previous modeled estimate had been 
approximately 45 million miles per day). Part of this estimated 
increase is due to actual growth in traffic in the Denver region, and 
part of it is due to use of improved methodologies for traffic counting 
in the region.
    In November 1996, Colorado submitted its 1996 report of 1995 actual 
annual VMT, as required by the SIP's VMT tracking provisions and the 
Act. This report showed that actual 1995 VMT were 4.4% greater than the 
SIP projections and 1.3% greater than the most recent revised 
projection for 1995. These exceedances are within the allowable limits 
of EPA's VMT Tracking Program guidance (5.0% and 3.0% for the 
respective VMT projections). EPA established these tolerances in 
recognition of the uncertainty inherent in attempting to measure actual 
VMT in a large urban area. Since the most recent reported actual annual 
VMT is within these allowable tolerances, the State is not required to 
implement its contingency measures, and no revision to the SIP is 
required. If a subsequent VMT tracking report shows that the SIP VMT 
projections (or updated forecasts) are exceeded by greater than the 
margins of error allowed by EPA guidance, implementation of the 
contingency measures will be required, along with a revision to the SIP 
if necessary.
    EPA believes that the State has followed the proper procedures (as 
outlined in EPA's guidance and the SIP's VMT Tracking Program protocol) 
in generating the annual VMT reports that EPA is relying on for its 
approval of the SIP. Several factors are involved in comparing 
estimates of daily VMT to estimates of annual VMT, including: (1) The 
geographic area covered by the different estimates; (2) whether average 
daily traffic or average weekday traffic are used; (3) the differences 
between the traffic counting network used by DRCOG for its model 
validation, and the network required for use by the Colorado Department 
of Transportation in generating the Highway Performance Monitoring 
System (HPMS) VMT data that the VMT Tracking Program traffic estimates 
are based on (use of HPMS data is required by EPA and U.S. Department 
of Transportation guidance); and (4) the assumptions behind the 
original VMT estimates in the SIP.
    There are a number of other factors that protect the SIP's 
attainment demonstration from growth in VMT. First, under the 
requirements of the EPA/DOT transportation conformity rule, DRCOG's 
transportation plans and transportation improvement programs must 
comply with the emissions budget for CO contained in the CO SIP, even 
if unexpected increases in VMT occur after the SIP is adopted. This 
budget protects the Denver area against future violations of the CO 
NAAQS in the face of growing VMT. If the budget cannot be met, DRCOG 
cannot adopt any new plans and TIPs, and no new regionally significant 
projects can be approved. Thus, failure to meet the budget has the same 
or greater effect as the imposition of highway sanctions under section 
179 of the Act. Second, it is important to note that virtually all of 
the growth in the metro area has occurred not in the downtown area, 
where the violations of the NAAQS have been monitored, but in outlying 
portions of the metro area. Thus, EPA would expect that VMT in the 
downtown area would increase at a lower rate than VMT for the metro 
area as a whole. This is supported by traffic counts at locations near 
downtown, which show that traffic in the central area increased at a 
rate of approximately 2-3% per year between 1990 and 1995, even though 
DRCOG estimates that traffic has increased approximately 4.5% per year 
regionwide. Finally, the air quality trends information submitted with 
the State's March 1996 milestone report shows that the Denver area is 
ahead of schedule to attain the CO NAAQS even with the higher-than-
expected estimates of daily VMT.
    Based on its conclusion that the attainment demonstration was 
inadequate, this commentor further concluded that the control 
strategies submitted with the SIP are insufficient to provide for 
attainment of the NAAQS. EPA's general response to this assertion is 
that the attainment demonstration is adequate, and that the modeling 
summarized in Chapter XII of the SIP and submitted to EPA demonstrates 
that the SIP will provide for attainment with the control measures 
included in the SIP.
    The commentor stated that the SIP does not include a requirement 
that gasoline sold during the winter months include a level of oxygen 
sufficient to attain the NAAQS. As discussed above, the SIP includes a 
requirement for a 3.1% minimum oxygen content; the attainment 
demonstration shows that this level of oxygen is necessary and

[[Page 10698]]

sufficient to provide for attainment of the NAAQS.
    The commentor stated that there is no indication that the State 
will apply the requirements for content and analysis of transportation 
plans, programs and projects contained in the conformity regulations. 
These requirements for nonattainment areas classified as serious and 
above are enforceable through the EPA/DOT conformity regulation, and 
DRCOG must comply with them when they take effect. There is no 
requirement in the conformity rule or in the Act that these provisions 
be incorporated into the CO SIP. However, they are mentioned on page I-
4 of the SIP.
    The commentor stated that the SIP does not satisfy section 
110(a)(2) of the Act. As outlined in detail in the Technical Support 
Document for EPA's proposed action, the SIP does satisfy the SIP 
content requirements of section 110(a)(2).
    The commentor stated that the SIP does not contain adequate 
measures to control stationary source emissions. Stationary point 
source emissions represent only 1.1% of base case emissions (based on 
actual emissions) and 5.6% of attainment year emissions (based on 
allowable emissions). None of the major sources are located in close 
proximity to the downtown monitors which record high concentrations, 
and these sources have little or no impact on Denver's ability to 
attain the NAAQS. However, stationary point sources of CO are regulated 
by Colorado Regulation No. 1 (Particulates, Smokes, CO and Sulfur 
Oxides). As noted above, woodburning is already regulated by Regulation 
No. 4; woodburning also has very little impact on the downtown 
monitoring sites. The remaining stationary sources of emissions are 
natural gas combustion and structural fires, which contribute a total 
of less than 1% to the attainment year inventory and again have very 
little impact on the high concentration monitoring sites.
    The commentor stated that the SIP should include a mandatory 
employer-based trip reduction program, or demonstrate that such a 
program is not necessary to demonstrate attainment of the NAAQS. As 
noted in the proposal, Congress revised the Act in 1995 to make 
submittal of trip reduction programs voluntary. Thus, EPA could not 
require the State to submit such a program even if the attainment 
demonstration were to be found inadequate.
    The commentor noted that the SIP does not contain an adequate 
milestone, nor does it contain an economic incentive program for 
implementation should the milestone not be met. Neither the Act nor EPA 
policy establish requirements for milestones, so the State was free to 
adopt its 1995 base case emission inventory as the milestone. The base 
case represents progress toward attainment (emissions in the 1995 base 
case were substantially lower than 1990 emissions), which is the intent 
of this requirement of the Act. Also, the Act does not require 
submittal of an economic incentive program until after either (1) the 
milestone has been missed or (2) the Denver area fails to attain by 
December 31, 2000. Thus, the SIP is not deficient in this regard.
    Finally, the commentor stated that EPA should expressly incorporate 
the baseline (pre-existing) control strategies in its approval of this 
SIP, that EPA should make it clear that its approval of the SIP is 
based on the understanding that these control strategies will remain in 
place, and that EPA should withdraw its approval of the SIP should 
these control strategies be weakened. As noted in the proposal, the 
baseline strategies relied upon in the attainment demonstration have 
already been incorporated into the Colorado SIP, making them federally 
enforceable; the new control strategies will also be incorporated into 
the SIP with EPA's final action on the SIP. EPA's approval is based on 
the enforceability of these measures and the SIP's stated intention 
that these measures continue to be implemented. If, subsequent to EPA 
approval, control measures are weakened or discontinued, EPA's 
available responses include making a finding of SIP non-implementation 
under section 179(a)(4) and/or section 113(a)(2) of the Act, or making 
a finding of SIP inadequacy and issuing a call for a SIP revision under 
Section 110(k)(5) of the Act. EPA believes that these mechanisms, along 
with EPA's and citizens' ability to directly enforce SIP requirements, 
are adequate to ensure that pre-existing control measures continue to 
be implemented.

Approval of the SIP

    While several parties requested that EPA disapprove the SIP, for 
reasons discussed above, two commentors supported EPA's approval of the 
SIP. EPA is proceeding with final approval of the CO SIP for the 
reasons discussed above and in our July 9, 1996 and December 6, 1996 
notices of proposed rulemaking.

III. Implications of Today's Final Action

    In today's action, EPA is approving SIP revisions submitted by the 
Governor on July 11, 1994, July 13, 1994, September 29, 1995, and 
December 22, 1995. Specifically, EPA is (1) approving the July 11, 1994 
attainment demonstration, VMT tracking and forecasting program, TCM, 
and contingency measures submittals for Denver; (2) approving the July 
13, 1994 attainment demonstration and contingency measures submittals 
for Longmont; (3) approving the control strategies for Denver, 
including the September 29, 1995 submittal of revisions to Regulations 
11 and 13 (I/M and oxygenated fuels); and (4) approving the further 
revisions to Regulation 13 submitted on December 22, 1995 that shorten 
the effective period of the oxygenated fuels program. For the reasons 
discussed in Section II of this document, EPA is not taking action on 
the SIP provision submitted on July 11, 1994 that calls for a 
prohibition of the re-registration of abandoned and impounded vehicles.
    In this document, EPA is also making a finding that the Denver/
Boulder carbon monoxide nonattainment area did not attain the NAAQS by 
the required attainment date of December 31, 1995, and is revising the 
area's classification for carbon monoxide in 40 CFR Part 81 from 
Moderate to Serious. This finding is based on air quality data 
revealing more than one exceedance of the CO NAAQS during calendar year 
1995, resulting in a design value higher than the NAAQS for the period 
1994-95. By action dated December 20, 1994, the EPA Administrator 
delegated to the Regional Administrators the authority to determine 
whether CO nonattainment areas attained the NAAQS, and to reclassify 
those that did not.
    EPA has reviewed this request for revision of the federally-
approved SIP for conformance with the provisions of the Act. EPA has 
determined that this action conforms with those requirements.
    Nothing in this action should be construed as permitting or 
allowing or establishing a precedent for any future request for 
revision to any State Implementation Plan. Each request for revision to 
any State Implementation Plan shall be considered separately in light 
of specific technical, economic, and environmental factors and in 
relation to relevant statutory and regulatory requirements.

IV. Executive Order (EO) 12866

    Under EO 12866, 58 FR 51735 (October 4, 1993), EPA is required to 
determine whether regulatory actions are significant and therefore 
should be subject to OMB review, economic analysis, and the 
requirements of the

[[Page 10699]]

EO. The EO defines a ``significant regulatory action'' as one that is 
likely to result in a rule that may (1) have an annual effect on the 
economy of $100 million or more or adversely affect, in a material way, 
the economy, a sector of the economy, productivity, competition, jobs, 
the environment, public health or safety, or State, local, or tribal 
governments or communities; (2) create a serious inconsistency or 
otherwise interfere with an action taken or planned by another agency; 
(3) materially alter the budgetary impact of entitlements, grants, user 
fees, or loan programs or the rights and obligations of recipients 
thereof; or (4) raise novel legal or policy issues arising out of legal 
mandates, the President's priorities, or the principles set forth in 
the Executive Order.
    Today's SIP-related actions have been classified as Table 3 actions 
for signature by the Regional Administrator under the procedures 
published in the Federal Register on January 19, 1989 (54 FR 2214-
2225), as revised by a July 10, 1995 memorandum from Mary Nichols, 
Assistant Administrator for Air and Radiation. The Office of Management 
and Budget has exempted these regulatory actions from EO 12866 review.
    Likewise, EPA has determined that today's finding of failure to 
attain would result in none of the effects identified in section 3(f) 
of the EO. Under Section 186(b)(2) of the Clean Air Act, findings of 
failure to attain and reclassification of nonattainment areas are based 
upon air quality considerations and must occur by operation of law in 
light of certain air quality conditions. They do not, in and of 
themselves, impose any new requirements on any sectors of the economy. 
In addition, because the statutory requirements are clearly defined 
with respect to the differently classified areas, and because those 
requirements are automatically triggered by classifications that, in 
turn, are triggered by air quality values, findings of failure to 
attain and reclassification cannot be said to impose a materially 
adverse impact on State, local, or tribal governments or communities.

V. Regulatory Flexibility

    Under the Regulatory Flexibility Act, 5 U.S.C. section 600 et. 
seq., EPA must prepare a regulatory flexibility analysis assessing the 
impact of any proposed or final rule on small entities (5 U.S.C. 
sections 603 and 604). Alternatively, EPA may certify that the rule 
will not have a significant impact on a substantial number of small 
entities. Small entities include small businesses, small not-for-profit 
enterprises, and government entities with jurisidiction over 
populations that are less than 50,000.
    SIP revision approvals under Section 110 and Subchapter I, Part D, 
of the CAA do not create any new requirements, but simply approve 
requirements that the State is already imposing. Therefore, because the 
Federal SIP approval process does not impose any new requirements, EPA 
certifies that this final rule would not have a significant impact on 
any small entities affected. Moreover, due to the nature of the 
Federal-State relationship under the CAA, preparation of a regulatory 
flexibility analysis would constitute Federal inquiry into the economic 
reasonableness of State actions. The CAA forbids EPA to base its 
actions concerning SIPs on such grounds. Union Electric Co. v. 
U.S.E.P.A., 427 U.S. 246, 256-266 (S. Ct. 1976); 42 U.S.C. section 
7410(a)(2).
    As discussed in section IV of this document, findings of failure to 
attain and reclassification of nonattainment areas under Section 
186(b)(2) of the CAA do not, in and of themselves, create any new 
requirements. Therefore, I certify that today's final action does not 
have a significant impact on small entities.

VI. Unfunded Mandates

    Under Section 202 of the Unfunded Mandates Reform Act of 1995 
(``Unfunded Mandates Act''), signed into law on March 22, 1995, EPA 
must prepare a budgetary impact statement to accompany any proposed or 
final rule that includes a Federal mandate that may result in estimated 
costs to State, local, or tribal governments in the aggregate, or to 
the private sector, of $100 million or more. Under Section 205, EPA 
must select the most cost-effective and least burdensome alternative 
that achieves the objectives of the rule and is consistent with 
statutory requirements. Section 203 requires EPA to establish a plan 
for informing and advising any small governments that may be 
significantly or uniquely impacted by the rule.
    EPA has determined that today's final approval actions do not 
include a Federal mandate that may result in estimated costs of $100 
million or more to either State, local or tribal governments in the 
aggregate, or to the private sector. These Federal actions approve pre-
existing requirements under State or local law, and impose no new 
requirements. Accordingly, no additional costs to State, local or 
tribal governments, or to the private sector, result from these 
actions.
    Likewise, EPA believes, as discussed in section IV of this 
document, that the finding of failure to attain and reclassification to 
Serious are factual determinations based upon air quality data and must 
occur by operation of law and, hence, do not impose any federal 
intergovernmental mandate, as defined in section 101 of the Unfunded 
Mandates Act.

VII. Small Business Regulatory Enforcement Fairness Act (SBREFA)

    Under 5 U.S.C. 801(a)(1)(A) as added by the Small Business 
Regulatory Enforcement Fairness Act of 1996, EPA submitted a report 
containing this rule and other required information to the U.S. Senate, 
the U.S. House of Representatives and the Comptroller of the General 
Accounting Office prior to publication of the rule in today's Federal 
Register. This rule is not a ``major rule'' as defined by 5 U.S.C. 
804(2).

VIII. Petitions for Judicial Review

    Under Section 307(b)(1) of the Act, petitions for judicial review 
of this action must be filed in the United States Court of Appeals for 
the appropriate circuit by May 9, 1997. Filing a petition for 
reconsideration by the Administrator of this final rule does not affect 
the finality of this rule for the purposes of judicial review nor does 
it extend the time within which a petition for judicial review may be 
filed, and shall not postpone the effectiveness of such rule or action. 
This action may not be challenged later in proceedings to enforce its 
requirements (see Section 307(b)(2)).

List of Subjects

40 CFR Part 52

    Environmental protection, Air pollution control, Carbon monoxide, 
Incorporation by reference, Intergovernmental relations, and Reporting 
and recordkeeping requirements.

40 CFR Part 81

    Environmental protection, Air pollution control, National parks, 
Wilderness areas.

    Dated: January 31, 1997.
Max H. Dodson,
Acting Regional Administrator.
    Chapter I, title 40 of the Code of Federal Regulations is amended 
as follows:

PART 52--[AMENDED]

    1. The authority citation for Part 52 continues to read as follows:


[[Page 10700]]


    Authority: 42 U.S.C. 7401-7671q.

Subpart G--Colorado

    2. Section 52.320 is amended by adding paragraph (c)(80) to read as 
follows:


Sec. 52.320  Identification of plan.

* * * * *
    (c) * * *
    (80) On July 11, 1994, July 13, 1994, September 29, 1995, and 
December 22, 1995, the Governor of Colorado submitted revisions to the 
Colorado State Implementation Plan (SIP) to satisfy those CO 
nonattainment area SIP requirements for Denver and Longmont, Colorado 
due to be submitted by November 15, 1992, and further revisions to the 
SIP to shorten the effective period of the oxygenated fuels program. 
EPA is not taking action on the SIP provision submitted on July 11, 
1994 that calls for a prohibition of the re-registration of abandoned 
and impounded vehicles.
    (i) Incorporation by reference.
    (A) Regulation No. 11, Motor Vehicle Emissions Inspection Program, 
5 CCR 1001-13, as adopted on September 22, 1994, effective November 30, 
1994. Regulation No. 13, Oxygenated Fuels Program, 5 CCR 1001-16, as 
adopted on October 19, 1995, effective December 20, 1995.

PART 81--[AMENDED]

    1. The authority citation for Part 81 continues to read as follows:

    Authority: 42 U.S.C. 7401-7671q.

    2. In 81.306, the Carbon Monoxide table is amended by revising the 
entry for ``Denver-Boulder Area'' to read as follows:


Sec. 81.306  Colorado.

* * * * *

                                            Colorado--Carbon Monoxide                                           
----------------------------------------------------------------------------------------------------------------
                                                           Designation                      Classification      
              Designated area               --------------------------------------------------------------------
                                              Date \1\              Type              Date \1\        Type      
----------------------------------------------------------------------------------------------------------------
                                                                                                                
*                  *                  *                  *                  *                  *                
                                                        *                                                       
Denver-Boulder Area:                                                                                            
    The boundaries for the Denver                                                                               
     nonattainment area for carbon monoxide                                                                     
     (CO) are described as follows: Start                                                                       
     at Colorado Highway 52 where it                                                                            
     intersects the eastern boundary of                                                                         
     Boulder County; Follow Highway 52 west                                                                     
     until it intersects Colorado Highway                                                                       
     119; Follow northern boundary of                                                                           
     Boulder city limits west to the 6000-                                                                      
     ft. elevation line; Follow the 6000-                                                                       
     ft. elevation line south through                                                                           
     Boulder and Jefferson Counties to US 6                                                                     
     in Jefferson County; Follow US 6 west                                                                      
     to the Jefferson County-Clear Creek                                                                        
     County line; Follow the Jefferson                                                                          
     County western boundary south for                                                                          
     approximately 16.25 miles; Follow a                                                                        
     line east for approximately 3.75 miles                                                                     
     to South Turkey Creek; Follow South                                                                        
     Turkey Creek northeast for                                                                                 
     approximately 3.5 miles; Follow a line                                                                     
     southeast for approximately 2.0 miles                                                                      
     to the junction of South Deer Creek                                                                        
     Road and South Deer Creek Canyon Road;                                                                     
     Follow South Deer Creek Canyon Road                                                                        
     northeast for approximately 3.75                                                                           
     miles; Follow a line southeast for                                                                         
     approximately five miles to the                                                                            
     northern-most boundary of Pike                                                                             
     National Forest where it intersects                                                                        
     the Jefferson County-Douglas County                                                                        
     line; Follow the Pike National Forest                                                                      
     boundary southeast through Douglas                                                                         
     County to the Douglas County-El Paso                                                                       
     County line; Follow the southern                                                                           
     boundary on Douglas County east to the                                                                     
     Elbert County line; Follow the eastern                                                                     
     boundary of Douglas County north to                                                                        
     the Arapahoe County line; Follow the                                                                       
     southern boundary of Arapahoe County                                                                       
     east to Kiowa Creek; Follow Kiowa                                                                          
     Creek northeast through Arapahoe and                                                                       
     Adams Counties to the Adams-Weld                                                                           
     County line; Follow the northern                                                                           
     boundary of Adams County west to the                                                                       
     Boulder County line; Follow the                                                                            
     eastern boundary of Boulder County                                                                         
     north to Highway 52.                                                                                       
    Adams County (part)....................  .........  Nonattainment..............     4/9/97  Serious.        
    Arapahoe County (part).................  .........  Nonattainment..............     4/9/97  Serious.        
    Boulder County (part)..................  .........  Nonattainment..............     4/9/97  Serious.        
    Denver County (part)...................  .........  Nonattainment..............     4/9/97  Serious.        
    Douglas County (part)..................  .........  Nonattainment..............     4/9/97  Serious.        
    Jefferson County (part)................  .........  Nonattainment..............     4/9/97  Serious.        
----------------------------------------------------------------------------------------------------------------
\1\ This date is November 15, 1990, unless otherwise noted.                                                     

* * * * *
[FR Doc. 97-5765 Filed 3-7-97; 8:45 am]
BILLING CODE 6560-50-P