ATTACHMENT B

SOCIOECONOMIC IMPACT ASSESSMENT

PROPOSED NEW RULE 66.1 -

MISCELLANEOUS SURFACE COATING OPERATIONS AND OTHER PROCESSES

EMITTING VOLATILE ORGANIC COMPOUNDS

October 2009

Prepared by

San Diego County Air Pollution Control District

10124 Old Grove Road

San Diego, CA 92131
SOCIOECONOMIC IMPACT ASSESSMENT

PROPOSED NEW RULE 66.1 -

MISCELLANEOUS SURFACE COATING OPERATIONS AND OTHER PROCESSES 

EMITTING VOLATILE ORGANIC COMPOUNDS

TABLE OF CONTENTS

PAGE

EXECUTIVE SUMMARY 1

I. INTRODUCTION 2

II. NECESSITY OF FUNDAMENTAL REVISIONS OF RULE 66 2

III. SUMMARY OF NEW RULE 66.1 3

IV. TYPE OF INDUSTRIES AFFECTED BY RULE 66.1 5

V. SOURCES REGULATED BY CURRENT RULE 66 AND THEIR VOC EMISSIONS 5

VI. EMISSION REDUCTION POTENTIAL OF THE PROPOSED NEW RULE 8

VII. RANGE OF PROBABLE COSTS TO INDUSTRY INCLUDING SMALL BUSINESS 9

VIII. IMPACT OF THE PROPOSED REVISED RULE ON EMPLOYMENT AND THE REGIONAL ECONOMY 10

IX. AVAILABILITY AND COST-EFFECTIVENESS OF ALTERNATIVES 10
SIA for SDAPCD Rule 66.1 B-1

EXECUTIVE SUMMARY

This report represents the results of a socioeconomic impact assessment (SIA) of the San Diego 

County Air Pollution Control District’s (District) proposed new Rule 66.1 – Miscellaneous 

Coating Operations and Other Processes Emitting Volatile Organic Compounds (VOCs). The 

new rule will replace existing Rule 66, which regulates VOC emissions from the usage of 

organic solvents in miscellaneous processes. Rule 66 has become seriously outdated since its 

initial adoption in 1972 and minor revision in 1995.

The main purpose of the fundamental revision and replacement of Rule 66 is for consistency

with other District rules regulating VOC emissions, e.g., to include a current definition of VOC 

as it is now used to define photochemically reactive compounds. Proposed Rule 66.1 contains 

VOC emission limits for the major processes or operations conducted by the affected facilities,

which are similar to the existing rule. However, the new rule will also control VOC emissions 

from surface cleaning and surface preparation operations by requiring the use of materials with a 

low VOC content or with a low VOC vapor pressure. (Existing Rule 66 has no limits on the 

VOC content or vapor pressure of cleaning materials.) Rule 66.1 includes recordkeeping 

requirements for manufacturers or suppliers of VOC containing materials and their users. The 

rule incorporates updated test methods and is reformatted according to similar District rules. The 

proposed new rule is required pursuant to State requirements for expeditiously adopting every

feasible control measure and federal requirements for use of Reasonably Available Control 

Technology (RACT) on sources of VOC emissions.

New Rule 66.1 will apply to the same 172 existing facilities, which are currently regulated under 

Rule 66, i.e., miscellaneous processes not subject to other District rules. The new rule

implementation will result in the VOC emission reduction from the use of compliant cleaning 

materials of approximately 9.1 tons per year, or by 16.4%.

New Rule 66.1 is not anticipated to have a detrimental socioeconomic impact on the affected 

industries. The SIA demonstrates that cleaning materials with a lower VOC content are 

currently available and many of them are already being used by the vast majority of businesses 

that are subject to the stricter VOC content standards. The cost of compliant materials is 

approximately the same or lower than conventional organic solvents. Only two out of 55 

permitted facilities must find a compliant solvent to use in their operations. In addition, many

compliant materials are now water-based, and therefore may provide additional health and 

environmental benefits by eliminating human exposure to organic solvents.
SIA for SDAPCD Rule 66.1 B-2

I. INTRODUCTION

California law requires air pollution control districts (excluding those with populations of less 

than 500,000 people) to perform a SIA when adopting, amending, or repealing rules and 

regulations that will significantly affect air quality and emission limitations.

The Health and Safety Code Section 40728.5 specifies the following elements to be included in 

the SIA:

1. The necessity of adopting, amending, or repealing the rule or regulation in order to attain 

State and federal ambient air quality standards.

2. The type of business, including small business, affected by the rule or regulation.

3. The range of probable costs, including costs to industry or business, including small business, 

of the rule or regulation.

4. The emission reduction potential of the rule or regulation.

5. The impact of the rule or regulation on employment and the economy of the region affected 

by the adoption of the rule or regulation.

6. The availability and cost-effectiveness of alternatives to the rule or regulation.

This report presents the results of an SIA of San Diego Air Pollution Control District's (District) 

proposed new Rule 66.1 (Miscellaneous Coating Operations and Other Processes Emitting 

Volatile Organic Compounds). It should be noted that the only new emission limitations 

introduced in Rule 66.1 are VOC content limits for surface cleaning and equipment cleaning

materials, including those used in wipe cleaning operations. Therefore, according to State law, 

only the socioeconomic impact of new VOC content limits for cleaning materials is considered 

in the following report.

II. NECESSITY OF REPLACING EXISTING RULE 66 WITH A NEW RULE

San Diego County does not meet the National and State Ambient Air Quality Standards for 

ozone and is classified as an ozone nonattainment area. Both federal and State laws require the 

District to implement rules that regulate emissions of ozone precursors – VOCs and nitrogen 

oxides.

Existing Rule 66 regulates VOC emissions from the usage of organic solvents in miscellaneous 

processes. It was approved by the Environmental Protection Agency (EPA) and is included in 

the State Implementation Plan.

Initially adopted by the District in 1972, Rule 66 was the first rule to control emissions of 

photochemically reactive compounds (presently known as VOCs) from stationary sources in San 
SIA for SDAPCD Rule 66.1 B-3

Diego County. It is presently used as a "catch-all" regulation that applies to operations that are 

not covered by other rules limiting VOC emissions for specific processes or sources, such as 

Rule 67.11 (Wood Products Coating Operations) or Rule 67.15 (Pharmaceutical and Cosmetic 

Manufacturing Operations). However, many provisions in the existing Rule 66 have become 

outdated and now the District proposes replacing it with new, fundamentally revised, Rule 66.1. 

The proposed new rule reflects the latest VOC definition, contains lower limits for the VOC 

content of cleaning materials already implemented in several California air districts, and updates

recordkeeping requirements and test methods.

The new rule will also help to fulfill the District’s commitment in the San Diego County 

Regional Air Quality Strategy to implement all feasible emission control measures as required by

State law as well as the federal requirement for RACT on sources of VOC emissions. Existing 

Rule 66 will be repealed upon the effective date of proposed new Rule 66.1, i.e., 12 months after 

its adoption by the Air Pollution Control Board.

III. SUMMARY OF PROPOSED NEW RULE 66.1

New Rule 66.1 will:

 Require any operation emitting volatile organic compounds and not covered by other 

District rules be controlled by air pollution control equipment unless the VOC emissions 

from this operation are less than 5 tons per year, excluding emissions from cleaning 

operations.

 Alternatively, allow a surface coating operation to comply with emission control 

requirements by using air-dried coatings with a VOC content not exceeding 420 grams 

per liter or baked coatings with a VOC content not exceeding 360 grams per liter.

 Require the use of surface preparation or solvent cleaning materials with a VOC content 

not more than 50 grams per liter (0.42 pounds/gallon) of VOCs, or having a total VOC 

vapor pressure 8mm Hg at 20oC (68oF) or less.

 Specify coating application methods to be used and the requirements for cleaning of 

coating application equipment for surface coating operations subject to this rule.

 Provide operating parameters and requirements for air pollution control equipment if it is 

used by a facility.

 Exempt from all rule requirements the use of pesticides, research and development 

operations, or testing for quality control or quality assurance purposes, touch-up 

operations and stripping of cured inks, coatings and adhesives, digital printing, and 

cleaning of electronic or electrical components, medical devices, laser optics, or precision 

optics.
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 Exempt the operations involved in the manufacture of biotechnology pharmaceutical or 

bio-agricultural products that do not a require permit to operate pursuant to Rule 11.

 Exempt from all rule requirements any coating operation that uses not more than 20 

gallons of coatings per consecutive 12 months or emits not more than 150 pounds of 

VOCs for the same period, provided that the specified records are kept.

 Exempt from the limitations on the VOC content of cleaning materials any cleaning 

operation that uses not more than 20 gallons of such materials per consecutive 12 months

or emits not more than 150 pounds of VOCs per the same period, provided that not more 

than the 20 gallons of such non-compliant material or not more than 150 lbs of VOCs are 

emitted per consecutive 12 months from all non-compliant cleaning materials at the 

stationary source and the specified records are kept.

 Exempt materials used for cleaning and surface preparation of aerospace components, 

including wipe cleaning from the VOC content limit provided these operations are not 

associated with surface coating operations and are in compliance with the requirements of 

Subsection (d)(4) of Rule 67.9 (Aerospace Coating Operations).

 Exempt certain cleaning operations involved in the manufacture of gas turbine engines or 

in military ship repair operations.

 List recordkeeping requirements for persons conducting operations subject to this rule.

 Require manufacturers, sellers or suppliers to provide specified information related to any 

VOC containing material that is used in an operation that may be subject to this rule.

 Provide definitions for major terms used in the rule including the reference to the most 

recent definition of VOCs and exempt compounds as specified in Rule 2.

 Update the test methods for determining compliance.

 Provide a compliance schedule for new and existing operations that are or may be subject 

to this rule.

It should be noted that the definition of VOC in the new proposed rule is significantly different 

from the definition of photochemically reactive compound in the old rule. It relates to the 

current understanding of photochemical reactivity and the concept of exempt compounds. A 

“photochemically reactive compound” in the old rule was defined in terms of its chemical 

composition and structure such as a presence of double or triple bonds, aromatic bonds, etc. For 

example, saturated hydrocarbons were considered non-photochemically reactive because they

have only single bonds. Therefore, existing Rule 66 has stricter emission limitations (40 

pounds/day) for compounds that comply with this definition than for the rest of organic 

compounds. For example, the existing rule does not require an additional emission control 

unless the emissions of “organic compounds” exceed 3,000 lbs per day.
SIA for SDAPCD Rule 66.1 B-5

The current concept of photochemical reactivity as defined by EPA considers all VOCs to be 

photochemically reactive except those that are proven to have negligible or very low 

photochemical reactivity (exempt compounds). Therefore, while the VOC emission limitations 

in the proposed rule seem similar to the existing rule, they are fundamentally different. The 

proposed new rule limits such emissions to 5 tons/year for all organic compounds except for 

those designated as “exempt compounds.”

IV. TYPE OF INDUSTRIES AFFECTED BY NEW RULE 66.1.

New Rule 66.1 is considered a “catch-all” general rule that is applicable to VOC emitting

sources that are not subject to the District source-specific rules. Therefore, the new rule as well 

as existing Rule 66 will apply to a variety of industries and processes such as plastic products, 

glass and rubber coating operations, golf club manufacturing, soil remediation, asbestos removal,

or other sources that emit VOCs as a part of production or cleaning operations. The following 

table presents the list of industries and their North American Industry Classification System 

(NAICS) codes that are subject to existing Rule 66 and also could be affected by the proposed

new Rule 66.1.

Table 1. NAICS Classification of Industries

Type of Operations NAICS Code Industry

Golf Club Assembly 339920 Sporting and athletic goods 

manufacturing

Miscellaneous Coating Operations on 

plastic, glass, rubber, composites, etc. 332811 Coating, heat treating and allied activities

Electronic Products Manufacturing 334411 Semiconductor and other electronic 

components mfg.

Soil Remediation 562910 Remediation services, environmental

Asbestos Abatement 562910 Asbestos abatement services

Other Operations Using VOC 

Containing Materials

333611, 325411,

336611, 336411 Miscellaneous

V. SOURCES REGULATED BY CURRENT RULE 66 AND THEIR VOC EMISSIONS 

1. Historical Data

The main purpose of revising current Rule 66 was to modernize it according to the current 

interpretation of photochemical reactivity and to include emission limits reflecting the 

availability of low VOC content cleaning materials. Simultaneously, the rule was reformatted to 

be consistent with other District rules regulating VOC emissions.

After Rule 66 was last revised in 1995, the District implemented or strengthened a number of 

rules that control VOC emissions from coating operations on a variety of substrates such as 

wood products, metal parts, aerospace components, automotive products, etc. The District also 

adopted or revised a few rules regulating manufacturing operations that take place in San Diego 
SIA for SDAPCD Rule 66.1 B-6

County, such as paint and printing ink manufacturing and bio-polymer manufacturing. In 

addition, since 1995, some industries, e.g., a significant part of aerospace industry, left the San 

Diego area due to the diminished government financing or outsourcing.

Therefore, Rule 66 is presently applicable only to miscellaneous coating operations and 

processes, which were considered by the District not to be a significant source of VOC emissions 

and therefore do not warrant separate individual rules.

It should also be noted that as a result of the current recession and other factors, many companies 

have significantly reduced their production volumes and employee work force. Some of them 

have closed down or moved their major operations to another state or abroad. This may be the 

reason for the smaller number of sources now subject to the rule and their corresponding air 

emissions.

This trend is seen very clearly in golf club manufacturing companies subject to this rule. They

underwent significant operational changes in the last couple of years which was reflected in their 

reduced air emissions. As shown in the District permit files, in 2007 there were eight golf club 

assembly companies, one of them a large company, with total VOC emissions of 72.7 tons/year. 

By September 2009, there were seven companies emitting only 35.5 tpy from coating and 

cleaning operations. One of the factors in such a drastic decrease in emissions was the cut in 

production of golf clubs at a large company and the subsequent transfer of its manufacturing 

operations abroad. The same trend was observed in miscellaneous coating operations. In the last 

year alone, at least three companies subject to the rule closed down or moved their operations 

from San Diego County.

To further illustrate this point, the following table shows a change in the number of plastic and 

composite coating operations and their VOC emissions from the cleaning operations subject to 

existing Rule 66 in the period between 1997 and 2008.

Table 2. Number of Companies and their VOC Emissions from Cleaning Operations

1997-2008

Substrate Number of 

Facilities

Total VOC emissions from cleaning 

operations (tons/year)

1997 2003 2008 1997 2003 2008

Plastics 26 15 18 2.8 1.4 1.6

Composites (includes golf club 

manufacturing companies) 16 10 11 15.1 23.0* 17.1

Total 42 25 29 18.0 24.4 18.7

* Includes VOC emissions from new wipe cleaning operations at a large company, which were 

subsequently reduced.

2. Existing facilities subject to the proposed rule.
SIA for SDAPCD Rule 66.1 B-7

There are presently 172 existing facilities that are regulated by Rule 66 and will be subject to 

Rule 66.1 after the new rule takes effect. The number of these facilities and their VOC 

emissions are grouped by type of operation in Table 3 below.

Table 3. Number of Facilities Subject to Rule 66.1 and Estimated VOC Emissions

Type of Operation Number of 

Facilities

Total VOC emissions 

from affected 

operations including 

cleaning operations 

(tons/year)

VOC emissions 

from cleaning 

operations only

(tons/year)

% of VOC emissions 

from cleaning

operations, per type of 

operation

Misc. Coating 

Operations 30 59.2 7.2 12.2

Misc. Processes 

using VOC 

Containing 

Materials

29 58.1 21.2 36.5

Golf Club 

Assembly 

Operations

7 35.5 22.9 64.5

Electronic Mfg. 21 38.1 4.2 11.0

Asbestos 

Abatement 23 2.7 0 0

Soil Remediation 62 33.5 0 0

TOTAL 172 227.1 55.5 N/A

Overall, the emissions from solvent cleaning operations are approximately 24.4 % of the total 

VOC emissions from all sources that will be regulated by the proposed rule.

Information provided in Table 2 also shows that solvent cleaning operations are only conducted 

in four out of six categories of affected operations that will be subject to Rule 66.1, i.e.,

miscellaneous coating operations, miscellaneous other processes using VOCs, golf club 

manufacturing, and electronic manufacturing.

Facilities conducting coating operations are painting various substrates such as plastics, glass, 

ceramics, leather, or rubber. Miscellaneous processes in Table 2 include a variety of operations 

such as chemical distillation, solvent recovery, resin manufacturing, rubber glove manufacturing, 

etc. Many of them have add-on emission control equipment or do not use any VOC containing 

cleaning materials. One large facility in this category that conducts wipe cleaning operations is 

using organic solvents for precision cleaning of laser optics components, precision welding, and 

thermal spray operations that have a limited exemption in the proposed rule for a volume of noncompliant materials used. The largest source of emissions in this category is a military facility

that cleans aerospace components. The cleaning materials used in this facility also have a 

limited exemption from Rule 66.1 VOC limits with the condition that these materials comply 

with the VOC content or boiling point limits of District Rule 67.9 (Aerospace Coating 

Operations).
SIA for SDAPCD Rule 66.1 B-8

The last category of processes that utilize cleaning materials is electronic manufacturing. Many

of these operations not specifically exempt from the proposed rule have add-on air pollution 

control equipment that reduces emissions from cleaning materials in compliance with the rule.

VI. EMISSION REDUCTION POTENTIAL OF THE PROPOSED NEW RULE

As mentioned above, the main purpose of revising Rule 66 was to bring it to the current 

state-of-the-art in air pollution control regulations, specifically, to update the definition of 

photochemically reactive compounds and to include the necessary recordkeeping and 

manufacturers’ requirements that will improve rule enforceability. Additionally, the proposed 

new rule is required pursuant to State requirements for expeditiously adopting every feasible 

control measure and federal requirements for use of RACT to control VOC emissions.

The VOC emission limit for many operations and processes (excluding solvent cleaning 

operations) in the proposed new Rule 66.1 is 5 tons per year. Facilities with uncontrolled

emissions higher than 5 tons/year will be required to reduce emissions either by using low VOC 

content products or by installing an add-on emission control system. This limit is similar to the 

requirements in existing Rule 66. Therefore, there will be no additional emission reductions

from this part of the rule because the regulated sources are already in compliance with this 

requirement. In addition, as shown in Table 2, the majority of operations such as asbestos 

abatement, soil remediation, and many miscellaneous coating operations are small sources with 

average emissions of less than 2 tons per year. Some coating operations are also using only 

compliant coatings (VOC content < 420 grams/liter). Other sources such as electronic 

manufacturing facilities have add-on emission control in place that comply with the rule 

requirements for the capture and control efficiency of such systems.

The expected emission reductions will be a result of new limits for the VOC content of cleaning 

materials that must not exceed 50 grams/liter, or a total VOC vapor pressure of 8mm Hg at 20oC.

Current Rule 66 has no limits on the VOC content or vapor pressure of cleaning materials.

As shown in Table 3, there are 30 facilities involved in miscellaneous coating operations on 

various substrates, such as plastics, glass, ceramics, or rubber. A recent District survey showed 

that at least 23 of them are already using compliant cleaning materials including exempt 

compounds (acetone, methyl acetate, or combination of exempt compounds), solvents with low 

vapor pressure or water-based cleaners. Others are using pure water for surface preparation and 

cleaning. Six facilities are exempt from the VOC content limits because they use less than 20 

gallons/year of cleaning materials or conduct coating operations on electronic or medical 

equipment that are also exempt from the rule. Consequently, there will be only one facility in 

this miscellaneous coating operations category that may be affected by the proposed rule. 

Another facility affected by the rule is involved in golf club assembly operations that presently

use high VOC content solvents for wipe cleaning of golf clubs.

The estimated VOC emissions reductions from these operations affected by the new VOC 

content limits for cleaning materials are provided in Table 4 below.
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Table 4. Expected VOC Emission Reductions from the Implementation of New Rule 66.1

Type of Operation

VOC emissions from 

cleaning operations 

(tons/year)

VOC Emission

reductions (tons/year)

VOC emission 

reductions per type 

of operation (%)

Misc. Coating Operations 7.2 0.9 12.5

Misc. Processes using 

VOC Containing Materials 21.2 None None

Golf Club Assembly 

Operations 22.9 8.2 35.8

Electronic Manufacturing 4.2 None None

TOTAL 55.5 9.1 N/A

Overall, the VOC emissions from solvent cleaning operations as a result of the proposed rule will 

be reduced by an estimated 9.1 tons/year or 16.4%. Although not quantified here, substantial 

additional emission reductions have already been realized by facilities voluntarily using 

compliant products prior to rule adoption, given that compliant products are already 

commercially available. (See Section VIII below for additional information.) Adoption of the 

proposed rule will ensure the San Diego Air Basin continues to benefit from these low-VOC 

materials and associated emission reductions.

VII. RANGE OF PROBABLE COSTS TO INDUSTRY INCLUDING SMALL 

BUSINESS

As mentioned above, the majority of businesses affected by the lower VOC content limits for 

cleaning materials are already using either exempt or water-based solvents. Considering that 

such materials are widely available and their prices are similar or lower than those for organic 

solvents, proposed Rule 66.1 will not impose any additional costs for the majority of the 

industrial sources, including small businesses. Also, all air districts in Southern California 

(outside of San Diego County) and the majority of districts in non-attainment areas in the 

northern part of the State already have rules requiring the use of low VOC content solvents. 

However, one large company in San Diego County will have some extra expenses to modify

their wipe cleaning operations that according to the recent data result in approximately 8.2

tons/year of VOC emissions. The company is actively searching for a compliant material that 

will also satisfy their quality control requirements. According to company information, the use 

of one of the alternative compliant materials would require additional drying steps and a 

consequent increase in labor costs. The District estimated that the cost of a compliant material 

and additional labor will result in the yearly cost increase of approximately $51,000, which 

corresponds to a cost effectiveness of $3.3 per pound of VOC reduced. This cost-effectiveness is 

significantly below the District guidelines of $6 per pound of VOC reduced for rules regulating 

VOC emissions.
SIA for SDAPCD Rule 66.1 B-10

VIII. IMPACT OF THE PROPOSED NEW RULE ON EMPLOYMENT AND THE 

REGIONAL ECONOMY

Proposed new Rule 66.1 will have no significant impact on employment and economy of the 

region because all compliant materials are widely available in the County at prices comparable or 

lower than conventional organic solvents. As it was discussed above, many companies are 

already using low or non-VOC containing cleaning materials.

This phenomenon can be partly explained as a result of market penetration of cleaning products 

mandated for use in the South Coast Air Quality Management District (SCAQMD) adjacent to 

San Diego County. Since early 2000, SCAQMD Rule1171 had a low VOC content limit

(25 grams/liter) for the majority of industrial cleaning solvents. That District also has published 

on its website a list of “Clean Air Solvents,” including the names and addresses of the solvents 

manufacturers that comply with Rule 1171 requirements. In addition, many of these materials 

have the same or even better cleaning properties combined with a decreasing health risks and 

improved fire safety in the workplace. As a result, many companies have voluntarily switched to 

more environmentally friendly materials or eliminated solvent cleaning steps altogether.

IX. AVAILABILITY AND COST-EFFECTIVENESS OF ALTERNATIVES

There are no reasonably available alternatives for the proposed rule. Not adopting it at this time 

would be a disservice to the District’s regulated community because the current rule is seriously 

outdated. In addition, the District has an obligation under State law to expeditiously adopt all 

feasible control measures and under federal law to require RACT on sources of ozone precursor

emissions.

To adopt a more stringent rule for the VOC content limit of cleaning materials (25 grams/liter) 

does not seem reasonable because it would result in minimal additional emission reductions

(approximately 600 lbs VOC per year) and exclude many cleaning products with a low VOC 

content or a low VOC vapor pressure that are presently successfully used by some facilities.