[Federal Register Volume 62, Number 65 (Friday, April 4, 1997)]
[Proposed Rules]
[Pages 16124-16125]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-8691]


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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 70

[AD-FRL-5806-2]


Clean Air Act Proposed Approval of Amendment to Title V Operating 
Permits Program; Pima County Department of Environmental Quality, 
Arizona

AGENCY: Environmental Protection Agency (EPA).

ACTION: Proposed rule.

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SUMMARY: The EPA proposes approval of the revision to the Operating 
Permits Program submitted by the Arizona Department of Environmental 
Quality (``ADEQ'') on behalf of the Pima County Department of 
Environmental Quality (``Pima'' or ``County'') for the purpose of 
complying with section 502(b)(3) of the Clean Air Act (``the Act''), 
which requires that each permitting authority collect fees sufficient 
to cover all reasonable direct and indirect costs required to develop 
and administer its title V operating permits program.

DATES: Comments on this proposed action must be received in writing by 
May 5, 1997.

ADDRESSES: Comments must be submitted to Ginger Vagenas at EPA, AIR-3, 
75 Hawthorne Street, San Francisco, CA 94105. Copies of Pima's 
submittal and other supporting information used in developing this 
proposed approval are available for inspection (AZ-Pima-97-1-OPS) 
during normal business hours at the following location: U.S. 
Environmental Protection Agency, Region 9; 75 Hawthorne Street; San 
Francisco, CA 94105.

FOR FURTHER INFORMATION CONTACT: Ginger Vagenas (telephone 415-744-
1252), Mail Code AIR-3, U.S. Environmental Protection Agency, 75 
Hawthorne Street, San Francisco, CA 94105.

SUPPLEMENTARY INFORMATION:

I. Background and Purpose

    As required under title V of the Clean Air Act as amended (1990), 
EPA has promulgated rules that define the minimum elements of an 
approvable state operating permits program and the corresponding 
standards and procedures by which the EPA will approve, oversee, and 
withdraw approval of state operating permits programs (see 57 FR 32250 
(July 21, 1992)). These rules are codified at 40 CFR Part 70. Title V 
requires states to develop and submit to EPA, by November 15, 1993, 
programs for issuing these operating permits to all major stationary 
sources and to certain other sources. The EPA's program review occurs 
pursuant to section 502 of the Act, which outlines criteria for 
approval or disapproval.
    On November 15, 1993, Pima's title V program was submitted. EPA 
proposed interim approval of the program on July 13, 1995 (60 FR 
36083). The fee provisions of the program were found to be fully 
approvable. On November 14, 1995, in response to changes in state law, 
Pima amended its fee provisions under Chapter 12, Article VI of Title 
17 of the Pima County Air Quality Control Code. Those changes were 
submitted to EPA on January 14, 1997, after it promulgated final 
interim approval of Pima's title V program (61 FR 55910, October 30, 
1996).

II. Proposed Action

    EPA is proposing to approve the submitted amendments to the fee 
provisions of Pima's title V operating permits program. A description 
of the submitted materials and an analysis of the amendments are 
included below.

A. Submitted Materials

    Pima's title V program amendment was submitted by the Arizona DEQ 
on January 14, 1997. The submittal includes the revised fee regulations 
(Chapter 12, Article VI of Title 17 of the Pima County Air Quality 
Control Code as amended on November 14, 1995), a technical support 
document, and a legal opinion by the County Attorney. Additional 
materials, including proof of adoption and a commitment to provide 
periodic updates to EPA regarding the status of the fee program, were 
submitted on February 26, 1997.

B. Legal Opinion

    Section 502(b)(3) of the Act requires that each permitting 
authority collect fees sufficient to cover all reasonable direct and 
indirect costs required to develop and administer its title V operating 
permits program. Pima's submittal includes an opinion from the County 
Attorney regarding the adequacy of the laws of the State of Arizona and 
Pima's amended title V program. The County Attorney states:

    [I]t is my opinion that the laws of the state of Arizona provide 
adequate authority to carry out all aspects of the amended program 
submitted by the Pima County Air Quality Control District to the 
EPA. * * *
    [T]he Arizona Revised Statutes and Pima County Code, Title 17, 
ensure that permit fees assessed as part of the Title V (Class 1) 
permit program will cover all reasonable direct and indirect costs 
required to develop, administer, and enforce Pima County's Title V 
Permit Program.

C. Permit Fee Demonstration

    Each title V program submittal must contain either a detailed 
demonstration of fee adequacy or a demonstration that aggregate fees 
collected from title V sources meet or exceed $25 per ton of emissions 
per year (adjusted from 1989 by the Consumer Price Index (CPI)). Pima 
has submitted a detailed fee analysis that demonstrates the fees it 
will collect under the amended rules are adequate to cover program 
costs.
    Title V emission fees. Pima's fee provisions require that the owner 
or operator of each source required to obtain a title V permit shall 
pay an annual emissions fee equal to $28.15 per year per ton of actual 
emissions of all regulated air pollutants, or a specified minimum, 
whichever is greater. See 17.12.510.C. and 17.12.510.C.5. Beginning in 
1994, the emissions fee rate is adjusted to reflect the increase, if 
any, in the Consumer Price Index. See 17.12.510.C.4.
    Emission fees are used by Pima to cover the costs of the Title V 
related activities not covered by title V permit fees. These activities 
are inspection services and associated direct and indirect costs. Pima 
estimates the annual cost of these activities to be $68,640. Based upon 
known sources and emissions reported by the sources, and using the 
emission fee ($28.15 per ton, indexed to the CPI beginning in 1994) and 
the fee schedule, the County estimates its annual revenue from 
emissions fees will be $70,100.
    Permit fees. Pima's fee provisions require that applicants for 
permits to construct and operate that are subject to title V must pay 
the total actual cost of reviewing and acting upon applications for 
permits and permit revisions. See 17.12.510.G. and 17.12.510.I. These 
fees are used to cover the cost of issuing permits. Pima estimated the 
permitting related average hourly billing costs for permitting of title 
V facilities, including salary, fringe benefits, direct non-salary

[[Page 16125]]

costs and indirect costs including cost estimates of various types of 
permit related activities. The estimated hourly cost is $53.60.
    Because state law caps hourly fees at $53.00, Pima's hourly charges 
are capped at $53.00. See 17.12.510.M. Although this cap is 60 cents 
per hour less than the District's estimated hourly costs for permit 
processing, EPA finds this provision to be fully approvable. Given the 
inherent uncertainty in the cost estimates, EPA believes that the 
difference is insignificant and unlikely to cause a shortfall in 
revenues. Further, Pima is tracking its program costs and revenues and 
has committed to provide EPA with periodic updates that will 
demonstrate whether fee revenues are meeting the costs of the program. 
If EPA finds that the County is not collecting fees sufficient to fund 
the title V program, it will require a program revision.
    In addition to imposing a cap on hourly fees, state law also limits 
the maximum chargeable fee for issuing and revising permits. State law 
and Pima regulations cap Title V permit issuance fees at $30,000. See 
17.12.510.G. Pima estimates processing costs for permit issuance at 
$21,484. Fees for processing permit revisions are capped at $25,000 for 
significant revisions and $10,000 for minor permit revisions. See 
17.12.510.I. Because the workload associated with these classes of 
permit revisions is likely to vary a great deal, Pima did not attempt 
to estimate the cost of these actions. The County believes that costs 
for permit revisions will be less than the maximum allowable fees. (See 
letter to Dave Howekamp, EPA, from David Esposito, Pima County, dated 
February 17, 1997.) EPA will periodically review the County program to 
ensure adequate fees are collected.

III. Administrative Requirements

A. Request for Public Comments

    The EPA is requesting comments on all aspects of this proposed 
approval. Copies of Pima's submittal and other information relied upon 
for the proposed interim approval are contained in a docket (AZ-Pima-
97-1-OPS) maintained at the EPA Regional Office. The docket is an 
organized and complete file of all the information submitted to, or 
otherwise considered by, EPA in the development of this proposed 
interim approval. The principal purposes of the docket are:
    (1) to allow interested parties a means to identify and locate 
documents so that they can effectively participate in the approval 
process, and
    (2) to serve as the record in case of judicial review. The EPA will 
consider any comments received by May 5, 1997.

B. Regulatory Flexibility Act

    The EPA's actions under section 502 of the Act do not create any 
new requirements, but simply address operating permits programs 
submitted to satisfy the requirements of 40 CFR part 70. Because this 
action does not impose any new requirements, it does not have a 
significant impact on a substantial number of small entities.

C. 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.
    The EPA has determined that the approval action promulgated today 
does 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. This federal action 
approves pre-existing requirements under state or local law, and 
imposes no new federal requirements. Accordingly, no additional costs 
to state, local, or tribal governments, or to the private sector, 
result from this action.

D. Executive Order 12866

    The Office of Management and Budget has exempted this action from 
Executive Order 12866 review.

List of Subjects in 40 CFR Part 70

    Environmental protection, Administrative practice and procedure, 
Air pollution control, Intergovernmental relations, Operating permits, 
Reporting and recordkeeping requirements.

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

    Dated: March 23, 1997.
Felicia Marcus,
Regional Administrator.
[FR Doc. 97-8691 Filed 4-3-97; 8:45 am]
BILLING CODE 6560-50-P