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Citation: 71 Fed. Reg. 48696 2006

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### Federal Register/Vol. 71, No. 161/Monday, August 21, 2006/Proposed Rules

ENVIRONMENTAL PROTECTION
AGENCY

40 CFR Parts 49 and 51 [EPA-HQ-OAR-2003-0076; FRL-8210-4]
RIN 2060-AH37

Review of New Sources and ModificationsIn Indian Country

AGENCY: Environmental Protection Agency (EPA). ACTION: Proposed rule.

SUMMARY: The Environmental Protection Agency (EPA) proposes to promulgate a Federal Implementation Plan (FIP) under the Clean AirAct (the Act) for tribes in Indian country. The FIPwould include two basic air quality regulations forthe protection ofcommunities in Indian country. The first rule would apply to minor stationary sources and minormodifications at major stationary

sources in Indian country (minor NSR rule). The second rule would apply to all new major stationary sources and major modifications located in areas of Indian country that are designated as not attaining the National Ambient Air Quality Standards (NAAQS) (nonattainment major NSR rule). These rules would be implemented by EPA, or

adelegate tribal agency assisting EPA with administration ofthe rules, until replaced by an EPA-approved tribal implementation plan for an area of Indian country. DATES: Comments.Comments must be received on or before November 20, 2006. Under the Paperwork Reduction Act, comments on the information collection provisions mustbe received by OMB on orbefore September 20, 2006.

PublicHearing. Ifanyone contacts us requesting to speak at a public hearing by September 11, 2006, we will hold a public hearing. Additional information about the hearing would be published in

a subsequent Federal Register notice. ADDRESSES: Submit your comments, identified by Docket ID No. EPA-HQOAR-2003-0076, by one ofthe following methods:

-

* http://www.regulations.gov. Follow the on-line instructions for submitting
comments.

* E-mail:a-and-rdocket@epamail.epa.gov.

* Fax: 202-566-1741. * Mail:Attention Docket IDNo. EPAHQ-OAR-2003-0076, U.S. Environmental Protection Agency, EPA West (AirDocket), 1200 Pennsylvania Avenue, Northwest, Mailcode: 6102T, Washington; DC 20460. Please include a total of 2 copies. In addition, please mail a copy ofyour comments on the information collection provisions to the Office ofInformation and Regulatory Affairs, Office ofManagement and Budget (OMB), Attn: Desk Officer for -EPA, 725 17th St., NW., Washington, DC 20503.

e Hand Delivery:U.S. Environmental Protection Agency, EPA West (Air Docket), 1301 Constitution Avenue, Northwest, Room B-102, Washington, DC 20004, Attention Docket ID No. EPA-HQ-OAR-2003-0076. Such deliveries are only accepted during the Docket's normal hours ofoperation, and special arrangements should be made for deliveries ofboxed information.

Instructions. Directyour comments to Docket ID No. EPA-HQ-OAR-2003- 0076. EPA's policy is that all comments received will be included in the public docket without change and may be made available online at http:// www.regulations.gov, including any personal information provided, unless the comment includes information claimed to be Confidential Business Information (CBI) or other information whose disclosure is restricted by statute. Do not submit information that you consider to be CBI or otheriqise protected through http:// www.regulations.govor e-mail. The http://ww.regulations.gov Web site is

an "anonymous access" system, which

means EPA will not know your identity

or contact information unless you provide it in the body ofyour comment. Ifyou send an e-mail comment directly
to EPA without going through http:// www.regulations.govyour e-mail address will be automatically captured and included as part ofthe comment that is placed in the public docket and made available on the Internet. Ifyou submit an electronic comment, EPA recommends that you include your

name and other contact information in thebody ofyour comment and with any disk or CD-ROM you submit. IfEPA
cannot read your comment due to technical difficulties and cannot contact you for clarification, EPA may notbe able to consider your comment. Electronic files should avoid the use of special characters, any form of encryption, and be free ofany defects or viruses. For additional instructions on submitting comments, go to I C &D of the SUPPLEMENTARY INFORMATION section ofthis document.

Docket:All documents inthe docket

are listed in the http:// www.regulations.govindex. Although listed inthe index, some information is
notpublicly available, e.g., CBI orother information whose-disclosure is restricted by statute. Certain other material, such as copyrighted material, will be publicly available only inhard
copy. Publicly available docket materials are available either electronically inhttp:// www.regulations.govorin hard copy at the U.S. Environmental Protection Agency, Air Docket,EPA/DC, EPA West, Room B102, 1301 Constitution Ave., NW., Washington, DC. The Public Reading Room is open from 8:30 a.m. to 4:30 p.m., Monday through Friday, excluding legal holidays. The telephone number for the Public Reading Room is (202) 566-1744, and the telephone number for the Air Docket is (202) 566- 1742.
FOR FURTHER INFORMATION CONTACT: For technical information, contact Raj Rao, Air Quality Policy Division, U.S. EPA, Office ofAir Quality Planning and. Standards (C504-03), Research Triangle Park, North Carolina 27711, telephone number (919) 541-5344, facsimile number (919) 541-5509, electronic mail e-mail address: rao.raj@epa.gov. To request apublic hearing orinformation pertaining to a public hearing on this document, contact Ms. Pamela S. Long, Air Qualify Policy Division, U.S. EPA, Office ofAir Quality Planning and Standards (C504-03), Research Triangle Park, North Carolina 27711, telephone number (919) 541-0641, facsimile number (919) 541-5509, electronic mail e-mail address: long.pam@epa.gov.

SUPPLEMENTARY INFORMATION:

I. General Information

A. Does ThisAction Apply toMe?

Entities potentially affected by this proposed action include owners and operators ofemission sources in all industry groups located in Indian country, EPA, and tribal governments that are delegated administrative authority to assist EPA with the implementation ofthese Federal regulations. Categories and entities potentially affected by this action are expected to include: 

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Category 

# [NAICS

' 

### Examples of regulated entities
Industry

...................................................................................................................

Federal government.........................................

State/local/tribal government

..................................................................................

aNorth American Industry Classification System. 4471 5614 21211 31332 33712 56221 115112 211111 211111 211112 212234 212312 212313 212321 221112 221119 221119 221210 221210 321113 321911 323110 323113 324121 325188 325188 331314 331492 332431 332812 421320 422510 422710 422710 486110 486210 562212 811121 812320 924110

924110 Gasoline station storage tanks and refueling. Lumber manufacturer support. Coal mining. Surface coating operation. Furniture manufacture. Medical waste incinerator. Repellent and fertilizer applications. Natural gas plant Oil and gas production. Fractionation of natural gas liquids. Copper mining and processing. Stone quarrying and processing. Stone quarrying and processing. Sand and gravel production. Power plant-coal-fired. Power plant-biomass fueled. Power plant-landfill gas fired. Natural gas collection. Natural gas pipeline. Sawmill. Window and door molding manufacturer. Printing operations. Surface coating operations. Asphalt.hot mix plants. Elemental phosphorus plant. Sulfuric acid plant Secondary aluminum production and extrusion. Cobalt and:tungsten recycling. Surface coating operations. Surface coating operations. Concrete batching plant. Grain elevator. Crude oil storage and distribution. Gasoline bulk plant. Crude oil storage and distribution. Natural gas compressor station. Solidwaste landfill. Automobile refinishing shop. Dry cleaner. Administration of Air and Water -Resources and

Solid Waste Management Programs. Administration of Air and Water Resources and

Solid Waste Management Programs.



### Thistable is not intended to be exhaustive, but ratherprovides aguide forreaders regarding entities likely tobe regulated by this action.To determine whetheryour facility is regulated by this action, you should examine the applicability criteria inthe proposed minor and major NSRprograms for Indian country, proposed 40 CFR 49.153 

### and 49.168,respectively. Ifyou have any questions regarding the applicability ofthis- action to a particular entity, contact the person listed inthe preceding FOR FURTHER INFORMATION CONTACT section.

B. What ShouldIConsiderasIPrepare My Comments forEPA?

1.Submitting CBI.Donot submit this 

### information to EPA through http:// www.regulations.govor e-mail. Clearly 

### markthe part orall ofthe information that you claim tobe CB1. For CBI information in a disk orCD ROM that youmail to EPA, markthe outside ofthe disk or CD ROM as CBI and then " identify electronically within the-disk or CD ROM the specific information that is claimed as CBI. In addition to one complete version ofthe comment that includes information claimed as CBI, a copy ofthe comment that does not contain the information claimed as CBI
must be submitted for inclusion in the public docket. Information so marked will not be disclosed except in accordance with procedures set forth in 40 CFR part 2. Send or deliver information identified as CBI only to the following address: Roberto Morales, OAQPS Document Control Officer (C404-02), U.S. EPA, Research Triangle Park, NC 27711, Attention Docket ID No. EPA-HQ-OAR-2003-0076.

2. Tips forPreparing Your Comments. When submitting comments, remember
to: &Identify the rulemaking by docket number and other identifying information (subject heading, Federal' Register-date.and page number).

* Follow directions-The agency may ask you to respond to specific questions

or organize comments by referencing a Code ofFederal Regulations (CFR) part

or section number.

a Explain why you agree or disagree; suggest alternatives and substitute language for your requested changes.

* Describe any assumptions and provide any technical information and/

or data that you used.

e Ifyou estimate potential costs or burdens, explain how you arrived at your estimate in sufficient detail to allow foritto be reproduced.

e Provide specific examples to illustrate your concerns, and suggest alternatives. 

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e Explain your views as clearly as, possible, avoiding the use ofprofanity

-or personal threats.

e Make sure to submit your comments by the comment period deadline identified.

C. Where CanIgeta CopyofThis DocumentandOtherRelated Information?

In addition to being available in the docket, an electronic copy ofthis pr9posal will also be available on the WWW. Following signature by the EPA Administrator, a copy ofthis notice will be posted in the regulations and standards section ofour NSR home page located athttp://www.epa.gov/nsrand

on the tribal air home page athttp:// www.epa.gov/oarltribal. D.How CanIFindInformationAbout a PossibleHearing?

Persons interested in presenting oral testimony should contact Ms. Pamela Long, New Source Review Group, Air Quality Policy Division (C504-03), U.S. EPA, Research Triangle Park, NC 27711, telephone number (919) 541-0641 or email long.pam@epa.govat least 2 days in advance ofthe public hearing. Persons interested in attending the public hearing should also contact Ms. Long to verify the time, date, and location ofthe hearing. The public hearing will provide interested parties the opportunity to present data, views,

or arguments concerning these proposed rules.

E. Overviewof Rule

In this rulemaking, we 1 are proposing
to fill a regulatory gap that currently exists inIndian country. We are proposing two new source review (NSR) rules under which the reviewing authority will issue pre-construction permits forcertain stationary sources of air pollution inIndian country. These proposed rules would provide additional regulatory tools forus to use in implementing the Act in Indian country. The minorNSR rule would apply to new and modified minor

sources and to minor modifications at major stationary sources. Sources subject to this rule would apply control technology, ifany, ds determined by the reviewing authority ona case-by-case basis. In rare instances at the discretion ofthe reviewing authority, such sources may also be required to submit an air quality analysis as part oftheir permit application. We are proposing to establish minor NSR thresholds so that



### IIn thisproposal, theterm "we" refers to theEPA and theterm "you" refers'to stationary sources of airpollution and theirowners and operators; only minor sources with a potential to emit (PTE) equal to orhigher than these thresholds would be subject to this rule. Additionally, this rule would allow otherwise major stationary sourcesin Indian country to voluntarily accept emission limitations on their PTE to become "synthetic minor sources." Such synthetic minor sources would include sources that emit hazardous air pollutants (HAP). In such a case, they would not be subject to major source MACT regulations under 40 CFR part 63. Any limitations on PTE mustbe enforceable as a practical matter (that is, legally and practically enforceable).

Under the nonattainment major NSR rule, affected sources would berequired
to comply with the provisions of 40 CFR .part 51, appendix S, a transitional rule which generally applies to areas that do
not have a State Implementation Plan (SIP). Sources subject to this rule would be subject to requirements forLowest Achievable Emission Rate (LAER) control technology, emissions offsets, compliance certification, and net air quality benefit analysis. Due to the limited number ofsources in Indian country, offsets are not generally available. We have proposed options for addressing the lack ofavailability of offsets in Indian country.

The information presented inthis preamble is organized as follows:
I.General Information

A. DoesThis Action Applyto Me? B.What Should IConsider as IPrepare My

Comments for EPA? C. Where Can Iget a Copy ofThis

Document and Other Related Information? D. How Can IFind Information About a

Possible Hearing? E. Overview ofRule. II.

Purpose III. Background A. The New Source Review (NSR)Program 1.What are the general requirements ofthe

major NSR program? 2.What are the general requirements ofthe

minor NSRprogram? B.Status ofAir Quality Programs inIndian

Country C. Consultation With Tribal'

.Representatives
IV. Proposed Rules for Indian Country

A. Minor NSR Program 1.What is a minor source andwhich minor

sources are subject to this rule? 2.What is a modification and what

modifications are subject to this rule? 3.What are the minor NSRthresholds and

how did we develop them? 4. Are any emissions units and activities at

stationary sources exempt fromthis rule? 5.What are the permit application, control

technology, and airquality analysis requirements, and what is the permit issuance process? 6. When are modifications subject to this

rule? 7. Why do we believe that an allowable-toallowable test is appropriate for minor sources? 8. Is your existing minor source subject to

this rule? 9. How are "synthetic minor sources"

subject to this rule? 10. How would section 112(g) case-by-case

MACT determinations be addressed by this rule? 11. What are the proposed requirements for

publicparticipation in the permitting process? 12. What are the monitoring,

recordkeeping, and reporting requirements? 13. What are the criteria for general

permits, what source categories generally qualify for them, and what are the permit application requirements for a general permit? 14. What is the administrative and judicial

review process proposed for this program? B.Major NSR Program in Nonattainment

Areas ofIndian Country 1.What are the requirements for major

source permitting under appendix S? 2. What are the options we are proposing

to address the lack ofavailable offsets in Indian country? , 3. What are the proposed public

participation requirements for this program? 4. How do I meet the statewide compliance

certification requirement ofthe Act? V. Legal Basis, Statutory Authority, and

. Jurisdictional Issues A. What is the basis for our authority to

implement theseprograms? B. How does a tribe receive delegation to

assist EPA with administration ofthe Federal minor and majorNSR rules? C. What happens to permits previously

issued by States to sources in Indian country?

. VI. Statutory and Executive Order Reviews

A. Executive Order 12866: Regulatory

Planning and Review B.Paperwork Reduction Act C. Regulatory Flexibility Act (RFA) D. Unfunded Mandates Reform Act E. Executive Order 13132: Federalism F . Executive Order 13175: Consultation

and Coordination With Indian Tribal Governments G.Executive Order 13045: Protection of

Children From Environmental Health & Safety Risks H. Executive.Order 13211: Actions That

Significantly Affect Energy Supply, Distribution, orUse I. Executive Order 12898: Federal Actions

To Address Environmental Justice in Minority Populations and Low-Income Populations J. National Technology Transfer

Advancement Act VII. Statutory Authority

II. Purpose

The purpose oftoday's rulemaking is
to ensure that air resources in Indian country will be protected in the manner intended by the Act as amended in 1990 by establishing.,,permitting program for 

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stationary sources inIndian country. Currently inIndian country, there is no permitting mechanism for new or modified minor sources; minor modifications atmajor sources; or new major stationary sources or major modifications ofregulated NSR pollutants in nonattainment areas. In addition, there is no minor source permitting mechanism for major stationary sources looking to voluntarily limit emissions to become synthetic minor sources 2 orfor approving caseby-case maximum achievable control technology (MACT) determinations. Today's proposed rules will fill this regulatory gap and provide regulatory certainty to allow for environmentally sound economic growth inIndian country. By establishing this FIP for Indian country, we will provide more consistency with the requirements and programs ofthe States and thus create

a more level regulatory playing field for

owners and operators within and outside ofIndian country. We are proposing these permit programs pursuant to section 110(a)(2)(C), part D oftitle I, and section 301(d) ofthe Act.

Im.Background

A. TheNew SourceReview (NSR) Program
1.What are the general requirements of the major NSRprogram?

The major NSR program contained in parts C and D oftitle I ofthe Act is a preconstruction review and permitting
program applicable to new major stationary sources and major modifications at such sources. In areas not meeting health-based NAAQS and in ozone transport regions (OTR), the program is implemented under the requirements ofpart D oftitle I ofthe Act. We call this program the "nonattaiment" major NSR program. In

areas meeting the NAAQS ("attainment" areas) or forwhich there is insufficient information to determine whether they
meet the NAAQS ("unclassifiable" areas), the NSR requirements under part C oftitle I ofthe Act apply. We call this program the Prevention ofSignificant Deterioration (PSD) program. Collectively, we also commonly refer to these programs as the major NSR program. These rules are contained in 40 CFR 51.165, 51.166, 52.21, 52.24, and part 51, appendices S and W.

For newly constructed, "greenfield"
sources, the determination ofwhether a

2 Sources located within the exterior boundaries ofIndianreservations in Idaho, Oregon, and Washington can apply fora non-Title V operating permitto establish synthetic minor status under the FIPestablished for those reservations. See 40 CFR
49.139 and40 CFR part49, subpartM. source is subject to the major NSR program is based on the source's PTE. The Act, as implemented by ourrules,
sets applicability thresholds formajor

sources in nonattainment areas. These thresholds are 100 tons per year (tpy)of any pollutant subject to regulation under the.Act, or smaller amounts, depending on the nonattainment classification. For attainment areas the thresholds are 100 or250 tpy, depending on the source type. A new

source with aPTE at or above the applicable threshold amount "triggers,"

or is subject to, major NSR.

For existing major sources, major NSR applies to a "major modification." For a modification to be major, the following three criteria have to bemet:

(1) A physical change in or change in the method of operation ofamajor stationary source must occur;

(2) The increase in emissions resulting from this change mustbe significant (equal to or above the significance levels defined in 40 CFR 52.21(b)(23)); and

(3) The increase in emissions resulting from the change must be a significant net emissions increase. In other words,when the increase from the project is added to other contemporaneous increases or decreases in actual emissions 3 atthe source, the
net emissions increase must be significant (equalto or above the significance levels defined in 40 CFR 52.21(b)(23)).

Major sources and major. modifications subject to nonattainment major NSR must apply state-of-the-art emissions control technologies, including any pollution prevention
measures, to achieve the LAER. The LAER isbased on the most stringent emission limitation inthe implementation plan ofany State, or achieved in practice, for the source category under review.

Each major source subject to nonattainment major NSRmust also "offset" its emissions increase by obtaining emissions reductions from other sources in the area, or in an area ofequal orhigher nonattainment classification that contributes to nonattainment inthe subject source's

area. The ratio ofthe offset relative to the proposed increase must be atleast
one-to-one and is based on the severity ofthe area's nonattainment classification. For ozone and particulate

3In approximate terms, "contemporaneous" emissions increases ordecreases arethose thathave occurred between the date 5 years immediately preceding the proposed physical or operational change and the date thattheincrease from the change occurs. See,for example, 40 CFR 52.21(b}(3)(ii). 

### matter less than 10 microns in aerodynamic diameter (PM-10), the

more polluted the air is where the

source is locating or expanding, the greater is the required offset ratio.The emissions reductions tobe used as offsets must be surplus (nototherwise required by the Act), quantifiable, federally enforceable; and permanent. See sections 173(a) and (c)ofthe Act and 40 CFR 51.165(a)(3).

Additionally, eachmajor nonattainment NSRpermit applicant must also conduct an analysis of "alternative sites,-sizes, production processes, and environmental control techniques demonstrating that the benefits ofthe proposed emissions

source significantly outweigh the environmental and social costs ofits location, construction, ormodification." Moreover, each major nonattainment NSRpermit applicant must demonstrate that allother major stationary sources underher/his control in the same State

arein compliance or on aschedule of compliance with all emission limitations and standards ofthe Act.

Underthe PSD program for attainment areas, a major source or modification must apply BestAvailable Control Technology (BACT),which may be based on pollution prevention techniques. Inaddition, the source must analyze theimpact ofthe project on ambient air quality to assure that no violation ofthe NAAQS orPSD increments will result, and must analyze impacts on soil, vegetation, and visibility. Sources ormodifications that. would impact Class Iareas (e.g., national parks)maybe subject to additional requirements to protect air quality related values (AQRVs)that havebeen identified for such areas. 2. What are the general requirements of the minor NSRprogram?

Section 110(a)(2)(C) oftheAct requires that every SIP include a program to regulate the construction and modification ofstationary sources, including apermit program asrequired by parts C and Doftitle IoftheAct, to ensure attainment and maintenance ofNAAQS. Parts CandD address the major NSRprogram for major stationary
sources, andthe permitting program for minor stationary sources is addressed by section 110(a)(2)(C) ofthe Act. We commonly referto the latter program as the "minor NSR" program. A minor stationary source means a source whose PTE is lower than the major source applicability threshold for aparticular pollutant as defined inthe applicable nonattainment major NSR program or PSD program. S48699

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The Federal requirements for minor

source programs are outlined 40 CFR 51.160 through 51.164. States must develop minor source programs to attai and maintain NAAQS. The Federal regulations forminor source programs
are considerably less detailed than the requirements for major sources. As a result,there is awider variety of programs and requirements for these "nonmajor" preconstruction activities.

Section 110(a)(2)(C) ofthe Act provides us with abroad degree-of discretion in developing a program to regulate new and modified minor stationary source construction activitie inIndian country.
B. Statusof Air QualityPrograms in IndianCountry

As we have discussed inprevious rulemaking actions which affect Indian country, inthe absence ofan EPAapproved program, we are authorized ti develop a FIP to protect air quality by directly implementing provisions ofth Act throughout Indian country.. See, e.g 59 FR 43958-61 (August 25, 1994), 63 FR 7262-64 (February 12, 1998), and 6, FR 13750 (March 21, 1997). Previously,

we had already promulgated rules establishing requirements-for major stationary sources in attainment areas and have issued PSD permits inIndian country (See40 CFR 52.21).

Under the Act and the Tribal Authority Rule (TAR) (See 40 CFR part 49, subpart A), eligible tribes may seek approval of their own PSD programs foi their reservations and/or for other areas under their jurisdiction. Currently, no tribe is administering an EPA-approved PSDprogram. Therefore, we implemeni the PSD program in Indian country. Unlike forthe PSD program, there is currently no FIP to implement either th nonattainment major NSR program or the minor NSR program in Indian country. Hence, there is a regulatory ga] in Indian country. Today's proposed rule will allow us to fully implement the NSR program in Indian country. WE

are proposing the minor NSR program E 40 CFR 49.151 through 49.165 and the nonattainment major NSR program at41 CFR 49.166 through 49.175. It is important to recognize, however, that

even ifwe adopt aFederal program thai applies in Indian country, the tribes may still develop Tribal Implementatio: Plans (TIPs), similar to SIPs, to implement these programs. If atribe develops aTIP to implement NSR, the TIP, once it is approved, will replace th Federal program as the requirement for that area of Indian country and the tribE will become the reviewing authority.

Sources that obtain enforceable emission limitations can avoid major source status by reducing their PTE below the applicable major source thresholds. Such sources are commonly

n referred to as "synthetic minors." The practice ofcreating synthetic minor

sources to avoid major NSR and title V iscommon under most State and local minor NSR permitting programs. However, outside ofIdaho, Oregoii, and Washington, no such minor source permitting mechanism is currently available in Federal regulations for Indian country.4 We therefore believe that inclusion ofthis provision in the proposed rules would significantly 3 benefit large sources inIndian country by providing them with ameans to legally avoid more stringent major NSR rules otherwise required by title I ofthe Act. We are establishing this mechanism for both stationary sources ofregulated NSR pollutants and HAPs.

C. ConsultationWith Tribal Representatives

Prior to undertaking this rulemaking, ;' we sought to include tribes early inthe rulemaking process. OnJune 24, 2002,

we sent approximately 500 letters to tribal leaders seeking their recommendations for effective consultation and their involvement in developing this rule.

We received responses from 75 tribes. Ofthese 75 tribes, 69 designated an environmental staffmember to work withus on developing the rules. Aside from the designated staff, many tribal leaders asked that we keep them informed ofour progress through e-mail, meetings with the EPA Regional Offices, newsletters, and Web sites. However, 53 percent ofthe tribal leaders also requested direct phone calls or conference calls to discuss the subject.

e Only 16 percent ofthe respondents requested face-to-face consultation. Of these, only six tribes requested senior P EPA staffto meet with tribal leaders. As a result ofthis feedback, we developed aconsultation plan that included three meetings held at the it reservations ofthe Menominee Tribe in Wisconsin, the Mohegan Tribe in 0 Connecticut, and the Chehalis Tribe in Washington. A fourth meeting was held in conjunction with the Institute of Tribal Environmental Professionals' (ITEP) 10th anniversary meeting in

n Flagstaff, Arizona. In addition to conducting these meetings, we also visited tribal environmental staffin Indian country. Over 30 tribes attended
e these meetings. As part ofour outreach efforts to the tribes, we participated in

4See footnote 2 formore information on the FIP that is in place in within the exterior boundaries of Indian reservations in these three States. numerous national and regional forums including the NationalTribal Forums sponsored by the ITEP, two National Tribal AirAssociation meetings, and at meetings with tribal consortia, such as the National Tribal Environmental Council, United Southern and Eastern Tribes, Inter-Tribal Environmental Council, Inter Tribal Council ofArizona, and others.

Although much of our effort focused

on outreach to the tribes, we also interacted with State and local air pollution control agencies during development ofthis rule. We had two meetings with the State and Territorial Air Pollution Program Administrators and the Association ofLocal Air Pollution Control Officers (STAPPA/ ALAPCO) to present the draft rules.

IV. Proposed Rules for Indian Country

A. MinorNSR Program

Today's action proposes provisions for a minor NSR program in Indian country. We propose to codify these provisions at 40 CFR 49.151 through 49.165. Our primary goal in developing this proposed rule is to ensure that air

resources in Indian country will be protected inthe manner intended by the Act. In addition, we seek to establish a ,flexible preconstruction permitting program for minor stationary sources in Indian country that is comparable to that which applies outside ofIndian country, in orderto create a more level regulatory playing field for owners and operators within and outside ofIndian country.

It is important to note, however, that outside ofIndian country there is a great deal ofvariation among State minor NSR permittingprograms. As a result, it would be impossible to create a single program that creates precisely equivalent regulations among all areas ofIndian country and the surrounding State areas. Instead, we designed the proposed rules to ensure that stationary

sources inIndian country would operate with a reasonable level ofair pollution control, ifnecessary, and in such a
manner to ensure that air resources in Indian country would be protected.

We are not attempting through this proposed rulemaking to establish a new, set ofminimum criteria that an eligible tribe, or a State, would need to follow in developing its own minor source permitting program. Rather, this proposal simply represents how we would implement the program in Indian country in the absence ofan EPAapproved implementation plan. However, if atribe is developing its own program, this can serve as one example of aprogram that meets the objectives 

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and requirements ofthe Act. We are proposing aminor source permitting program that addresses, on anational level, many environmental and regulatory issues that are specific to Indian country. We understand that States and eligible tribes may face different issues, and may therefore choose to develop different programs for their own State orTribal Implementation Plans.

1. What is a minor source and which minor sources are subject to this rule?

A minor source means a source whose PTE is lower than an applicable major

source threshold. For the NSR program in Indian country, the major source thresholds are defined inthe PSD program (See40 CFR 52.21) and in today's proposed nonattainment major NSR program (see proposed 40 CFR 49.167), as applicable, and differ for attainment areas and nonattainment

areas forthe same pollutant. For example, in attainment areas the major

source threshold forNitrogen Oxides (NOx) fora source is 250 tpy, unless the

source belongs to a source category that is listed in the major NSR rules (See40 CFR 52.21(b)(1)(i)(a)), in which case the major source threshold is 100 tpy. In contrast, the major source threshold for NOx in ozone nonattainment areas can vary from 10tpy in an extreme ozone nonattainment area to 100 tpy in a marginal ozone nonattainment area. A

source can be amajor source for some pollutants and aminor source for others.

Today, we are proposing to establish

a minor NSR threshold as provided in section IV.A.3 ofthis preamble. The proposed rule would apply to only those minor sources whose PTE is equal
to or greater than the minor NSR threshold for theregulated NSR pollutant. Such sources would include (1) New minor sources, (2) modified minor sources, and (3) synthetic minor

sources including HAP sources. A .source's PTE for apollutant is expressed intpy and generally is calculated by multiplying the maximum hourly emissions rate in pounds per hour (lbs/ hr)times 8,760 (which is the number of hours in a year) and dividing by 2,000 (which is the number ofpounds in a ton), unless the source is restricted by permit conditions that are enforceable

as a practical matter.

Section IV.A.6 ofthis preamble includes detailed flowcharts to aid you in determining ifaproposed new source would be subject to the proposed rule. The flowcharts differentiate between attainment areas and nonattainment

areas because the applicability criteria 

### are different for PSD and nonattainment major NSR.
2.What is a modification and what modifications are subject to this rule?

Forthe purposes ofthisrule, a modification is defined at proposed 40 CFR49.152(d) as (anyphysical or operational change at astationary

source that would cause an increase in the allowable emissions ofthe affected emissions units for any regulated NSR pollutant orthat would cause the emission ofanyregulated NSR pollutant notpreviously emitted.( The following exemptions would apply:

* A physical or operational change does not include routine maintenance, repair, orreplacement.

, Anincrease inthe hours of operation or inthe production rate is not considered an operational change unless such increase is prohibited under any federally-enforceable permit condition or other permit condition that is enforceable as a practical matter.

* A change in ownership at a stationary source is notconsidered a modification.

Note that this definition differs from the term "modification" as used in the majorNSR program, primarily in that it is based on an increase in allowable emissions rather than actual emissions. Parts Cand D oftitle Iofthe Act "the statutory basis forthe major NSR. program' refer to section 111(a)(4) ofthe Act [the definition of "modification" for purposes ofthe new source performance standards (NSPS)program) to define "modification" forpurposes ofthe major NSRprogram. In arecent decision,the D.C. Circuit Court of Appeals ruled that,based on the wording ofthe definition of "modification" insection 111(a)(4) of the Act, the applicability ofmajor NSR to modifications mustbe based on changes in actual emissions (Stateof New York, eta)., v. U.S.EPA,June 24, 2005). However, because the statutory 

### basis forthe minorNSR program is section 110(a)(2)(C) ofthe Act, which. 

### does notdefine or refer to a definition of"modification," we believe thatwe have discretion in defining the term as

- we think it bestfor the minor NSR program inIndian country that we are proposing today. We do not believe that the recent decision ofthe D.C. Circuit Court ofAppeals applies to minor NSR programs. We seek comment on whether

our proposed definition ofmodification 

### is appropriate for minor NSRfor minor

sources.

Thisrule would apply to certain modifications at minor sources and to minor modifications (notmajor 

### modifications as defined in proposed 40 CFR 49.167 and in 40 CFR 52.21) at major sources. How such modifications would be addressed under the proposed rule is explained in section IV.A.6 of this preamble. Section IV.A.6 also includes detailed flowcharts to aid you in determining ifa proposed modification would be subject to the proposed rule..

3.What are the minor NSR thresholds and how did we develop them?

A review ofseveral State minor NSR programs indicated that a number of State programs have established cutoff levels orminor NSR thresholds, below which sources are exempt from their minor NSR rules. We believe that such

an approach is also appropriate in Indian country. Section 110(a) (2)(C) of the Actrequires minor NSR programs to

assure that the NAAQS are attained and maintained. Applicability thresholds are proper in this context provided that the

sources and modificatfons with emissions below the thresholds are inconsequential to attainment and maintenance ofthe NAAQS. As discussed further, the minorNSR thresholds that we are proposing today
meet this criterion. In addition, these thresholds will result in amore costeffective program and reduce the burden

on sources and reviewing authorities.

Intoday's rulemaking, we are proposing to adopt minor NSR .thresholds as emission rates intpy. In setting the minor NSR thresholds for minor sources ofregulated NSR pollutants, we decided to use .emission rates, rather than air quality impacts, as the basis forthe exemption. We chose this approach because we were concerned that applicability determinations bas~ed on projected air quality impacts would beexcessively complex and resource intensive. In addition, it is consistent with the approach used inmajor NSR.

We are proposing minor NSR thresholds that we have developed based on a-review ofseveral State minor NSR programs. We found that there is variation in State approaches to minor NSR applicability. Some States do not prescribe source applicability thresholds, instead providing a list of emission units and activities that are excluded from minor NSR. Many ofthe States that do have applicability thresholds also provide alist of excluded emission units and activities. Intoday's rulemaking, we propose threshold levels that we believe are neither the most stringent nor the least stringent ofthe levels found in existing State minor NSR rules. These threshold levels represent a reasonable balance between environmental protection and 

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economic growth, since we did notwant protection at the cost ofdiscouraging programs, and we believe that these them tobe so high that they were not economic growth. We consider the limits will be appropriate for use in environmentally protective or so low proposed thresholds to be representative Indian country. The proposed that they.ensured environmental ofsuch thresholds in State minor NSR thresholds are listed inTable 1.

TABLE 1.-MINOR NSR THRESHOLDS

Minor NSR thresholds for nonattainment areas Minor NSR threshRegulated NSR pollutant (tpy) oldsfor attainment areas Extreme Other areas (tpy) ozone areas
Carbon m onoxide (C O)

..................................................................................................... 5 5 10 Oxides of nitrogen (N Ox)

.................................................................................................. -0 5 10 Sulfur dioxide (SO 2) 5 5 10 Volatile Organic Compounds (VOC)

................................................................................. 0 2 5 PM -...................................................................................................................................... 5 5 10 PM-1

.................................................................................. ..... *****'"1 1 5 P

M

-2.5

............................................................................................................................... 0.6 0.6 3 Lead

............................................................................................................................ ... 0.1 0.1 0.1 Fluorides.......................................... :-

... **""****"'*"*.....

.... ........... **

... NA NA1 Sulfuric acid mist

............................................................................................ • .................. N

A N A 2 Hydrogen sulfide (H 2S)

...................................................................................................... NA NA 2 Total reduced sulfur (including H2S) ................................................................................ .NA NA 2 Reduced sulfur compounds (including H2S) ..................................................................... NA NA 2 Municipal waste combustor emissions

.............................................................................. NA

, NA 2 Municipal solid waste landfills emissions (measured as Non Methane Organic Compounds)

........................................................................................................................... N

A N A 10

The selected minor NSR thresholds designation ofthe area where the source these sources fall below the proposed distinguish between minor stationary would be located. Ifa source straddles minor NSR thresholds, how many are
sources ofregulated NSR pollutants the two areas, the more stringent between the minor NSR and major NSR located innonattainment versus thresholds would apply. thresholds, and howmany are above the attainment areas and by pollutant. We To evaluate how the proposed minor major NSR threshold. 5 Ifwe assume that believe this distinction is important NSR thresholds might affect new the distribution ofnew sources will because ofthe different air quality goals sources locating in Indian country, we mirror the existing source distribution, in nonattainment and attainment areas. looked at the size distribution of this analysis approximates the fraction

In some cases, atribe's area ofIndian existing sources across the country. ofnew sources that will be exempt from country may be divided between a Usingthe National Emission Inventory minor NSR, subject to minor NSR, and nonattainment area and an attainment (NEI), which includes the most subject to minor The

area. In this situation, the applicable comprehensive inventory ofexisting subject to major NSR, respectively. The threshold for a proposed source or U.S. stationary point sources that is results ofthis analysis by pollutant are modification would correspond to the available, we determined how many of summarized inTable 2.

TABLE 2.-DISTRIBUTION OF SOURCES AND EfMISSIONS UNDER PROPOSED MINOR NSR THRESHOLDS

Total facilities Unregulated minor Minor sources Major sources Pollutant No. TPY sources (x10 3) (x10 6) %of total %ofTPY %of total %ofTPY %of total %ofTPY

CO

.................................. 28.9 4.43 65 0.8 29 11 6 88 S02

................................................................... 

### 21.2 13.90 76 0.1 '16 

### 1 8 99 PM 10 ...............................
........................... ....... - 33.9 1.69 65 1.3 32 22 4 .76
PM2.5

................................................................ 

### 33.8 1.33 59 0.8 38 23 3 76 Ozone- VOC
................................................... 43.3 1.60 42 1.1 53 41 5 58 Ozone- NOx
.................................................... 30.5 7.93 53 0.4 36 6 11 93 Nitrogen dioxide (NO 2)

..................................... 30.5 7.93 59 0.6 32 7 9 92

As shown inTable 2, we performed the analysis foreach ofthe criteria pollutants except lead, including VOC

5For this analysis, we used the final 1999 NEI, extrapolated to 2001. More on the 1999 NEI canbe found athttp://www.epa.govttn/rhief/net/ 1999inventory.html. and NOx emissions as the precursors of

ozone. 6 For each pollutant, the table gives the total number offacilities in the

6For the analysis, we used the major NSRand proposed minor NSR thresholds for each pollutant based onthe attainment status and classification of the county in which each source is located. We made certain simplifying assumptions, including using the 250 tpy major source threshold for all emission inventory for that pollutant and thetotal, nationwide annual emissions of the pollutant. The column

sources in attainment areas, regardless ofsource category or major source status.for other pollutants. Forthe details oftheanalysissee "Analysis ofthe Proposed Minor NSR Thresholds" dated October 24, 2005 in the docket for this rulemaking. 

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labeled "unregulated minor sources" represents the percentage oftotal

sources that fall below the minor NSR threshold, along with the percentage of total annual emissions that those

sources emit.The "minor sources" column gives the same information for

sources that fallbetween the minor NSR threshold and the major NSRthreshold, while the "major sources" column addresses sources that exceed the major NSR threshold.

Webelieve that Table 2provides excellent evidence that sources with emissions below the proposed minor NSR thresholds willbe inconsequential to attainment and maintenance ofthe NAAQS. For each pollutant, only around 1percent (or less)oftotal emissions would be exempt from review under the minor NSRprogram. Atthe

same time, the proposed thresholds will promote a cost-effective program. According to Table 2, anywhere from 42 percent to 76 percent ofsources (depending on thepollutant)would be too smalltobe subject to preconstruction review.

Webelieve that the proposed minor NSRthresholds provide areasonable approach to determining the applicability oftheminor NSR program. These thresholds would prevent stationary sources that make negligible contributions topollution from being regulated under thisrule. However, this would notaffect the applicability of other requirements, such asthose-foundin an NSPS ora MACT standard. Atthe

same time, the limitswould ensure that intermediate-sized sources would be subject to reasonable control technology requirements. We seek comment onour approach to selecting the proposed minorNSR thresholds, on alternative approaches to selecting such thresholds, and on alternative applicability provisions (suchas source category exemptions).
4. Are any emissions units and activities at stationary sources exempt from this rule?

Certain emissions units and activities at stationary sources either do not emit regulated NSRpollutants to the ambient -airor emitthese pollutants in negligible amounts.We propose that such activities located at aminor source be exempt from the requirements ofthis rule (Seeproposed 40 CFR 49.153(c)). .We propose that such activities are limited tothe following:

* Air-conditioning units for comfort that are not subjectto applicable requirements under title VI oftheAct and do not exhaust airpollutants into the ambient air from any manufacturing

orindustrial process; * Ventilating units forcomfort that do
not exhaust air pollutants into the ambient air from any manufacturing or other industrial process;

* Heating units for comfort that do notprovide heat for any manufacturing

or other industrial process;

* Noncommercial food preparation; " Consumer use ofoffice equipment and products;

e Janitorial services and consumer

use ofjanitorial products;

e Internal combustion engines used forlandscaping purposes;

. . Bench scale laboratory activities, except forlaboratory fume hoods and vents; and

* Any emissions unit or activity that does nothave the potential to emit a regulated NSR pollutant or HAP, so long

as that emissions unit or activity is not part of aprocess unit that emits orhas the potential to emit a regulated NSR pollutant orHAP.

5. What are the permit application, control technology, and air quality analysis requirements, and what is the permit issuance process?

Permit ApplicationRequirements. Under today's proposed minor NSR program, asthe owner or operator ofa proposed new minor source or a proposed-modification that is subject to this rule, you must submit a complete application to your reviewing authority requesting a minorNSR permit specific
to your source (unlessyou wish to seek

a "general permit," if eligible). In addition to basic information identifying and describing your source, your application must include a list of all affected emissions units. "Affected emissions units" are defined as all the emissions units at yourproposed new minor source'or all the new,modified, and replacement emissions units that comprise your proposed modification (excluding the exempt emissions units and activities listed in proposed 40 CFR 49.153(c)). Seeproposed.40 CFR 49.152(d).

Your application also must document the increase in emissions ofregulated NSR pollutants that will result from
your new source or modificati6n so that the reviewing authority can verify that you are subject to this proposed minor NSR program, rather than to major NSR. For each new emissions unit that you. list,you must provide the PTE in tpyfor each regulated NSR pollutant, along with supporting documentation. For any modified or replacement unit that you list,you must provide the allowable emissions ofeach regulated NSR pollutant in tpy bothbefore and after the modification orreplacement, along with supporting documentation. For 

### emissions units that do nothave an established allowable emissions level priorto the modification, youmust report the PTE. The allowable emissions forany emissions unit are calculated considering any emission limitations that are enforceable as apractical matter'

onthe unit's PTE. In calculating these emission levels for applicability purposes, we seek comment on whether you should include fugitive emissions, to the extent that they are quantifiable, forall sources, or include them only for

source categories listed pursuant to section 302(j) ofthe Act orexclude them for all sources.

You may include inyour application proposed emission limitations forthe listed emissions units. Ifyou do, you must account forthese limitations in your calculations ofpost-construction PTE and/or allowable emissions. The application also must identify and describe any existing airpollution control equipment and compliance monitoring devices or activities relevant to the affected emissions units, as well

as any existing emission limitations or work practice requirements to which any affected emissions units are subject. See proposed 40 CFR49.154(a) forthe complete requirements foryour application for a-minor NSRpermit

You may request that the reviewingauthority establish an annual minor

source plantwide applicability

. limitation (minorsource-PAL) for one or
more oftheregulated NSR pollutants emitted by yournew or existing minorstationary source. Aminor source PAL is a source-wide limitation on allowable emissions ofa regulated NSR pollutant, expressed in tpy, that is established under the proposed 40 CFR 49.155 and that is enforceable asa practical matter (Seeproposed 40 CFR 49.152(d)).

For a new minorstationary source, you mayrequest minor source PALs for

some or all.ofthe regulated NSR pollutants emitted byyour source. For the otherregulated NSRpollutants.that your source emits (i.e.,the non-PAL pollutants), yourpermit will contain annual allowable emissions limitsfor each emissions unit. "

You may request aminor source PAL for one or more regulated PAL pollutants at the timethat youare modifying an existing minor stationary

source. Each PAL will apply across all the emissions units at your source, whether or notthey are affected bythe modification. For the non-PAL pollutants, onlythe emissions unitsthat

are affected by the modification will receive annual allowable emissions limits. Ifyourequest one ormore minor

source PALs for an existing minor stationary source at atime when no 48703

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modification is planned, each PAL will apply across all the emission's units at your source, but your permit will include no new emission limits for the non-PAL pollutants.

Ifyour source.is in a source category covered by a "general permit" issued under proposed 40 CFR49.156, you may apply for the general permit forthat

source category. A general permit is a permit developed by your reviewing authority for a general category of emissions units or stationary sources that are similar in nature, have substantially similar emissions, and would-be subject to the same or substantially similar requirements governing operations, emissions, monitoring, reporting, and recordkeeping. The permit application requirements for aparticular general permit will be specified in that general permit. General permits are discussed further in section IV.A.13 ofthis preamble.

ControlTechnologyReview.As required under section 110(a)(2)(C) of the Act, the minor NSR permitting program that we are proposing today is primarily designed to assur6 that the NAAQS are achieved, and to prohibit any stationary source from emitting any air pollutant in amounts that would contribute to nonattainment orinterfere with maintenance ofthe NAAQS. At the

same time, we wish to provide flexibility incontrol technology requirements for minor sources located in Indian country to promote economic growth and development.

Therefore, intoday's proposal, we are proposing that your reviewing authority perform acontrol technology review on
a case-by-case basis when issuing the permit (other than ageneral permit). By "control technology," we mean pollution prevention techniques, add-on pollution control equipment, design and equipment specifications, work practices, and operational restrictions. This review would consider local air quality needs, typical control technology used by similar sources in surrounding areas, anticipated economic growth inthe area, and costeffective control alternatives. At a minimum, the reviewing authority must' require control technology that assures that the NAAQS are achieved and that each affected emissions unit will comply with allrequirements of40 CFR parts 60, 61, and 63 that apply. The required control technology resulting from such a review may range from technology that is less stringent than the reasonably available control technology (RACT) level ofcontrol (whichis typically required for existing major

sources in nonattainment areas), to technology that is the BACT level of control (whichis the level required for

new major sources aid major modifications in attainment areas), depending on the air quality needs of the area, other applicable regulatory programs ofthe Act, and technical and economic feasibility.

Based on the results ofthe control technology review, the emission limitations required by the reviewing authority may consist ofemission limits, pollution prevention techniques, design standards, equipment standards, work practice standards, operational standards, or any combination thereof. If it istechnically and economically feasible, the reviewing authority must require an emission limit (i.e., a limit on the quantity, rate, or concentration of emissions) for each affected emissions unit at your source.

For anew minor source that is subject
to this rule,the case-by-case control. technology review would be conducted for all emissions units [except the exempt emissions units and activities discussed in section IV.A.4 and listed in proposed 40 CFR49.153(c)] that emit or have the potential to emit the pollutant forwhich the source is subject to this rule. However, for modifications, such control technology review would apply only to the affected emissions unit(s).

In establishing a case-by-case control technology review process to determine

an appropriate level ofcontrol forminor

sources and subject modifications in Indian country, we considered a number offactors. On the one hand, we believe that the control technology review process should be as flexible as possible
to provide for the specific needs and conditions ofeach area ofIndian country, tonsistent with the requirements ofthe Act. On the other hand, we believe that a reasonable level ofair pollution control fornew minor

sources and subject modifications in Indian country is generally warranted'toensure protection ofair resources in Indian country. In addition, we wish to

ensure that Indian country not be seen

as a potential "pollution haven" where minor stationary sources can go to escape air pollution control requirements, At the same time, we do
not want to put tribes or owners and operators locating in Indian country at

a competitive disadvantage by requiring substantially more stringent controls in Indian country than are required in the surrounding areas.

We are seeking comment on the proposed case-by-case control technology review for all new and modified sources subject to this minor NSR program. We also request comment

on whether the program should have a control technology requirement at all. Section 110(a)(2)(C) of-theAct requires

a minor NSR program that assures that the NAAQS are achieved, but does not mandate that the program include a control technology requirement. We are seeking comment on whether a control technology requirement is necessary to achieve the purposes ofthe Act, or whether other approaches can achieve these purposesjust as well with less
cost or administrative burden.

Air QualityImpactsAnalysis. Typically, for a new ormodified minor

source permit application, your reviewing authority would not require

an Air Quality Impacts Analysis (AQIA). In rare instances, ifyour reviewing authority has reason to be concerned that the construction ofyour minor

source ormodification could cause or contribute to a NAAQS or PSD increment violation, to ensure protection ofthe NAAQS, wo are proposing that your reviewing authority may require you to conduct an AQIA using dispersibn modeling in accordance with 40'CFR part 51, appendix W to determine the impacts that will result from your new source or modification. If theAQIA demonstrated that the construction ofyour source or modification would cause or contribute
to a NAAQS orPSD increment violation, you would be required to further reduce its impact before you could obtain a permit.

Permit IssuanceProcess.Within 45 days after receiving your permit application, your reviewing authority must either determine that the permit application is complete enough to

commence a technical review or request additional information. Ifyou do not receive a request for additional information or a notice ofc6mplete application within 50 days ofyour permitting authority's receipt of your application, your application would be deemed complete. (You should contact your reviewing authority to find out the date that it received your application so that you will know when this 50-day period is up.) Once the application is complete, your reviewing authority develops a draft permit and provides, a public notice seeking comments on the draft permit for a 30-day period. After considering all timely,relevant comments, ifyour reviewing authority determines that your application meets all applicable requirements, it would. issue you afinal permit. Otherwise, the reviewing authority would send you a letter denying your permit application with reasons for the denial. We seek comm9nt on the proposed permit 

### issuace proc9ss..

,, 

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We areproposing that your reviewing authority would issue you apermit with

an allowable emissions limit in tpy for each affected emissions unit (OptionA). You have the alternative ofrequesting a minor source PAL or cap in tpy (Option B), and your reviewing authority may issue such a permit. This type ofpermit

canprovide the flexibility to make frequent changes atyour source without permitreview. Ifyouwish,you may request aminor source PAL for some pollutants and allowable emissions limits foreach emissions unit forother pollutants.

PermitTerm. A preconstruction 

### permit does not expire. Yourpermit remains valid as long as youcommence construction ofyour new source or modification within 18 months after the effective date ofthe permit, you do not discontinue construction fora period of 18 months or more, and you complete construction ina reasonable time. Your reviewing authority may extend the 18- month period wherejustified. The 18- month limit does not apply to the time period between construction of approved phases ofa phased construction program; you must

commence construction ofeach such phase within 18 months ofthe approved commencement date for that phase.

6. 

### When are modifications subject to this rule?

As discussed in section IV.A.2 ofthis preamble, for the purposes ofthe minor NSR program proposed today, a modification means any physical or operational change at a stationary

source that would cause an increase in the allowable emissions ofthe affected emissionsunits for any regulated NSR pollutant orthat would causethe emission ofany regulated NSRpollutant not previously emitted (withthe exclusions outlined in section IV.A.2 of this preamble). The proposed rule would apply to certain modifications at your minor sources andminor modifications atyour major sources. For such modifications, you would haveto meet the application requirements and comply with any control technology requirements as discussed in section IV.A.5 ofthis preamble. In rare instances, ifyour reviewing authority hasreasontobelieve that your modification could result ina violation ofthe NAAQS or PSD increment, you would be required to conduct an AQIA.

Inall NSR applicability determinations, youmust evaluate each regulated NSRpollutant individually. The area where your source is located maybe attainment for some pollutants and nonattainment for others, which affects whichpollutants areregulated as well as the major and minor NSR applicability thresholds. For a given modification, a particular pollutant may be subject to review under PSD, nonattainment major NSR, or minor NSR, or may not be subject to any of these programs.

The first step in determining whether your proposed physical or operational change is subject to the minor NSR
program proposed today is to determine whether the change is subject to the applicable major NSR program (i.e., proposed 40 CFR 49.167 or40 CFR 52.21 for nonattainment and attainment

areas, respectively). Ifyou are changing

an existing major source, you would determine whether the change qualifies

as amajor modification using the procedures in the applicable major NSR
program. Ifyou are changing an existing minor source, you would determine whether the change would qualify as a major stationary sourceby itselfunder the applicable major NSR program. If
your proposed physical or operational change is subject to review under major NSR for a regulated NSR pollutant, it is
not subject to the minor NSR program for that pollutant.

Ifyour proposed physical or operational change is not subject to major NSR, the next step is to determine whether the change qualifies as a modification under the minor NSR program. To be a modification, the change must result in an increase in allowable emissions atyour source. Thus, the next step is to calculate whether, and by how much, allowable emissions would increase as aresult of the change. Ifyour minor stationary

source is subject to a minor source PAL for aregulated NSR pollutant (Option B in section IV.A.5 ofthis preamble), the emissions increase forthat pollutant would be the PAL level after the physical or operational change minus the PAL level prior to the change. For physical oroperational changes at other minor stationary sources (i.e., those with annual allowable emissions limits for each emissions unit (Option A), those that are.unpermitted, and those with a combination ofunpermitted emissions units and emissions units with annual allowable emissions limits) and at major stationary sources, the total increase in allowable emissions resulting from your proposed change would bethe sum ofthe following:

* For each new emissions unit that is
to be added, the emissions increase would be the PTEofthe unit.

&For each emissions unit with an allowable emissions limitthat is to be changed orreplaced, the emissions increase would be the allowable emissions ofthe emissions unit after the change orreplacement minus the allowable emissions prior to the change

or replacement. This may be a negative value for an emissions unit ifits allowable emissions would be reduced

as aresult ofthe change orreplacement.

o For each unpermitted emissions unit that is to be changed or replaced, the emissions increase would be the allowable emissions ofthe unit after the change orreplacement minus the PTE prior to the change orreplacement. It is
necessary to use PTE since these emissions units will not have a allowable emissions limit priorto the change. This maybe a negative value for

-an emissions unit if its post-change allowable emissions would be lessthan its pre-change PTE.

This process ofsumming the emissions increases and decreases

across all the affected emissions units is called "project netting," which is discussed later in'this section ofthe preamble.

Ifyour proposed physical or operational change qualifies as a modification (i.e., causes an increase in allowable emissions), the final step in determining whether the proposed modification is subject-to today's proposed minor NSR program is to compare the increase in allowable emissions to the applicability criteria for the type of source and emission limits that you have. Your modification would be subject to the minorNSR program in the following circumstances:

a Ifyour minor source has a permit with aminor source PAL intpy (Option B in section IV.A.5 ofthis preamble) and the modification would result in any increase in the PAL level. To determine ifan increase in thePAL level is necessary, you must evaluate whether your source's actual emissions after the modification would exceed the PAL levelby any amount. Ifyou could
construct and operate the modification without your actual emissions exceeding yourminor source PAL, then

nopermit action would be required.

* For other minor sources, ifthe modification would increase total allowable emissions from the affected emissions units by an amount that equals or exceeds any ofthe minor NSR thresholds listed inTable 1 ofthis preamble.

o Ifthe minor modification at your major source would increase total allowable emissions from the affected emissions -unitsby an amount that equals or exceeds any ofthe minorNSR thresholds listed in Table 1 ofthis preamble.

o In addition, ifthe modification would increase allowable emissions from any emissions unit above an 

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established unit-specific allowable emission permit limit, even ifthe total increase foryour source would be less than the corresponding minor NSR threshold listed inTable 1ofthis preamble. Inthis case, the needed increase inthe unit-specific allowable emissions permit limit canbe accomplished through an administrative permit revision (Seeproposed 40 CFR 49.159(f)).

In addition, aphysical or operational change maybe subject to today's proposed minor NSRprogram even ifit is not classified as a modification (i.e., it does not increase allowable emissions ofa regulated NSR pollutant or resultin emission ofa pollutant notpreviously emitted). For example, a proposed change might increase allowable emissions from some emissions units and decrease emissions at others so that, overall, emissions from the affected units would stay the same or decrease. Ifthe post-change emissions at any emissions unit would exceed a permitted allowable emissions limit for that unit,you must apply to revise the existing permit limit before you may implement the change. The needed increase inthe unit-specific allowable emissions permit limit can be accomplished through an administrative permit revision (See proposed 40 CFR 49.159(f)).



### Similarly, other proposed physical or operational changes that could notbe implemented within the requirements of

an existing permit would necessitate a permit revision, even ifthey are not otherwise subject to major orminor NSR. Webelieve that this fact will serve to ensure that the types ofchanges that could significantly alterthe dispersion characteristics ofthe airpollutants emitted by your source willbe brought to the attention ofyour reviewing authority. Thus, the reviewing authority will be inthe position to evaluate whether the change has the potential to increase ambient concentrations outside the boundaries ofyour source. Ifso, the reviewing authority can require

measures to mitigate any unacceptable air quality impacts (i.e.,to protect the NAAQS and PSD increments) as partof the permit revision process.

Flowcharts to aid in determining major and minor NSR applicability are presented in Figures 1through 6. These flowcharts illustrate the applicability process for new sources and modifications inattainment areas and nonattainment areas. The flowcharts should be used to evaluate each regulated NSR pollutant individually since different flow charts may apply to differentpollutants depending on the attainment status ofthe area for each pollutant.

BILLING CODE 6560-50-P 

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