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Citation: 77 Fed. Reg. 66398 2012

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-- The search text of this PDF is generated from uncorrected OCR text.66398 Federal Register/Vol. 77, No. 214/Monday, November 5, 2012/Rules and Regulations

[FR Doe. 2012-26759 Filed 11-2-12; 8:45 am]

BILLING CODE 6560-50-P

ENVIRONMENTAL PROTECTION

AGENCY

40 CFR Part 52 [EPA-R09-OAR-2012-0398; FRL-9745-8]

Partial Approval and Disapproval of Air Quality Implementation Plans; Arizona; Infrastructure Requirements for Ozone and Fine Particulate Matter

AGENCY: Environmental Protection Agency (EPA).

ACTION: Final rule.

SUMMARY: EPA is approving in part and disapproving in part State Implementation Plan (SIP) revisions submitted by the state ofArizona pursuant to the requirements ofthe Clean Air Act (CAA)for the 1997 8-hour

ozone national ambient air quality standards (NAAQS) and the 1997 and 2006 NAAQS for fine particulate matter (PM2. 5). The Clean Air Act requires that each State adopt and submit a SIP forthe implementation, maintenance, and enforcement ofeach NAAQS promulgated by the EPA. Arizona has
met most ofthe applicable requirements. Where EPA is disapproving, in part, Arizona's SIP revisions, several ofthe deficiencies have already been addressed by a federal implementation plan (FIP). The remaining deficiencies are subject to a two-year deadline for EPA to promulgate a FIP, unless EPA approves
an adequate SIP revision prior to that time. EPA remains committed to working with Arizona to develop such

a SIP revision.

DATES: EffectiveDate:This final ruleis effective on December 5, 2012.

ADDRESSES: EPA has established a docketfor this action, identified by Docket ID Number EPA-R09-OAR2012-0398. The index to the docket for this action is available electronically at www.regulations.govandin hard copy atEPA Region IX, 75 Hawthorne Street, SanFrancisco, California. While all documents in the docket are listed in the index, some information maybe publicly available only at the hard copy location (e.g., copyrighted material), and

some may not be publicly available in either location (e.g., CBI). To inspect the hard copy materials, please schedule an appointment during normalbusiness hours with the contact listed directly below.

FOR FURTHER INFORMATION CONTACT: Jeffrey Buss, Air Planning Office (AIR2), U.S. Environmental Protection Agency, Region IX, (415) 947-4152, buss.jeffrey@epa.gov.

SUPPLEMENTARY INFORMATION: Throughout this document, the terms "we," "us," and "our" refer to EPA.

Table of Contents

I.Background II. EPA's Response to Comments IL Final Action IV. Statutory and Executive Order Reviews

I. Background

On July 18, 1997, EPA issued a revised NAAQS for ozone Iand a new NAAQS for fine particulate matter (PM2.5). 2 EPA subsequently revised the 24-hour PM2. 5NAAQS on September 21, 2006.3Each ofthese actions triggered a requirement for states to submit an infrastructure SIP to address the applicable requirements of section 110(a)(2) within three years ofissuance ofthe new or revised NAAQS. OnJune 27, 2012 (77 FR 38239), EPA proposed to approve in part and disapprove in part several SIP revisions submitted by the Arizona Department of Environmental Quality (ADEQ)to address the infrastructure requirements ofCAA section 110(a)(1) and (2)for the 1997 ozone, 1997 PM2.5, and 2006 PM2. 5 NAAQS. Additionally, onJuly 30, 2012 (77 FR 44551), EPA proposed to approve the portion ofthe Arizona Infrastructure SIP pertaining to section 110(a)(2)(D)(i)(I) concerning interstate transport for the 2006 24-hour PM2. 5 NAAQS. 4 Also on July 30, 2012 (77 FR 44555), EPA proposed topartially approve and partially disapprove the portion ofthe Arizona Infrastructure SIP pertaining to the conflict ofinterest provision in section 110(a)(2)(E)(ii). ADEQ submitted SIP revisions to EPA

on September 18, 2008 ("2008 Infrastructure Analysis") and October 14, 2009 ("2009 Infrastructure Analysis") to address all ofthe CAA section 110(a)(2) requirements, except

1The 8-hour averaging periodreplaced the previous 1-hoar averaging period, and the level of the NAAQS was changed from 0.12 parts per million (ppm)to 0.08 ppm (62 FR 38856).

2The annual PM2.5standard was set at 15 micrograms percubic meter (pg/m3), based on the 3-year average ofannual arithmetic mean PM2.5 concentrations from single ormultiple communityoriented monitors and the 24-hour PM2.5standard

was setat 65 pg/m 3

,based on the 3-year average of the 98th percentile of24-hour PM2.5concentrations
at each population-oriented monitor within an area (62 FR 38652).

3The finalrule revising the 24-hour NAAQS for PM2.5from 65 pg/m 3 to 35 pg/m 3was published in the Federal Register on October 17, 2006 (71 FR 61144).

4EPA previously approved anearlier interstate transport submittal by Arizona for the 1997 ozone and 1997 PM2.5 NAAQS at 72 FR 41629 (July 31, 2007). for section 110(a)(2)(G), 5 and a proposed SIP revision submitted onJune 1, 2012.6 The proposed SIP served as a supplement to the prior two infrastructure SIP revisions and was submitted under the parallel processing mechanism provided by 40 CFR Part 51, Appendix V, Section 2.3. The final version ofthe June 1, 2012 proposed SIP revision was adopted on August 24, 2012 and submitted toEPA on the same day ("2012 Submittal").

We are taking final action on allthree submittalsbecause they collectively address the applicable infrastructure SIP requirements for the 1997 ozone, 1997 PM2.5, and 2006 PM2.5NAAQS. We refer
to them collectively herein as "Arizona's Infrastructure SIP Submittals."

The rationale supporting EPA's actions, including the scope of infrastructure SIPs in general, is explained in the Notices ofProposed Rulemakings (NPRs)and associated technical support documents (TSDs) 7 and will not be restated here. The TSDs

are available online at www.regulations.gov,Docket ID number EPA-R09-OAR-2012-0398.

II. EPA's Response to Comments

The public comment period for our proposal published in the Federal Register onJune 27, 2012 (77FR 38239) started at publication and closed onJuly 27, 2012. The public comment period for our proposals ofJuly 30, 2012 (77FR 44551, concerning interstate transport

5In a separate rulemaking, EPA proposed to fully approve Arizona's SIP to address the requirements regarding airpollution emergency episodes in CAA section 110(a)(2)(G) for the 1997 8-hour ozone NAAQS. 77 FR 21911 (April 12, 2012). Thefinal rule for this action was signed on July 26, 2012. While we are awaiting publication inthe Federal Register, a prepublication copy ofthat final rule is available inthe docket for today's rulemaking.

6On June 14, 2012 ADEQ submitted a letter requesting withdrawal ofseveral statutes included in the June 1, 2012 proposed SIP revision. See letter dated June 14, 2012 from Eric C. Massey, Air Quality Director, Arizona Department of Environmental Quality, to Jared Blumenfeld, Regional Administrator, EPA Region 9.

7 Each ofour three proposed rules had an associated TSD available at www.regulations.gov under docket ID number EPA-R09-OAR-2012- 0398. The three TSDs are as follows: (1) "Technical Support Document: Evaluation ofArizona's Infrastructure SIP for the 1997 8-hour Ozone, the
1997 PM 2.5,and the 2006 PM 2.5NAAQS," June 15, 2012 (document ID number EPA-R09-OAR-2012- 0398-0003); (2) "Technical SupportDocument for EPA's Proposed Action on the State ofArizona's 2009 Infrastructure StateImplementation Plan (TransportPortion) for the 2006 24-hoar Fine Particulate (PM2.5)National Ambient Air Quality Standard," July 2012 (document ID number EPAR09-OAR-2012-0398-0033); and (3) "Technical Support Document: EPA Evaluation of Arizona Provisions for Section 110(a)(2)(E)(ii)/Section 128 Conflict ofInterest Requirements," July 2012 (herein, "Section 128 TSD") (document ID number EPA-R09-OAR-2012-0398-0075).

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for the 2006 24-hour PM2
. 5NAAQS; and 77 FR 44555, concerning conflict of interest requirements) started at publication in the Federal Register on July 30, 2012 and closed on August 29, 2012.

During the respective comment periods we received one comment letter from ADEQ ("ADEQ comment letter"), which concerned the requirements of CAA sections 110(a)(2)(E)(ii) and 128.8
In our July 30, 2012 notice on these requirements (77 FR 44555), we proposed to partially approve and partially disapprove a SIP revision submitted by ADEQto address the requirements ofCAA section 110(a)(2)(E)(ii) for the 1997 ozone, 1997 PM2.5, and 2006 PM2.5 NAAQS (77 FR 44555). In particular, we proposed to find that the statutes submittedby ADEQ met nearly all the requirements ofCAA section 128, and therefore proposed to partially approve the submittal with respect to CAA section 110(a)(2)(E)(ii). However, with respect to the air quality hearing boards in Maricopa, Pima, and Pinal counties [hereinafter "County Boards"], we proposed to determine that the provisions submitted by ADEQin its 2009 and 2012 SIP revisions did not adequately address all ofthe requirements ofCAA section 128(a)(1). We have summarized the ADEQ
comment letter in three comments, and have responded to each, below. Comment#1: ADEQdisagrees with EPA's assessment that the statutes and regulations provided in its supplementary submittal ofJune 1, 2012 do not apply to enforcement orders and asks EPA to approve the State's submittals with respect to CAA section 110(a)(2)(E)(ii). The State argues that the
statutes it submitted, "in particular ARS [sections] 38-101 and 38-501 through 39-511, * * * apply to all public agency officers and employees, whether
atthe State, County, or City level" and that ARS 38-503(B) forbids public officers and employees having a conflict ofinterest in any decision ofthe agency from participating in that decision. In other words, "[u]pon recusal ofeach person with a conflict ofinterest, all of the members remaining who are authorized lawfully to make the decision represent the public interest and do not derive any significant income from parties subject to the permits or enforcement orders at issue." ADEQ notes that ARS 49-478 ("Hearing board") also applies tothe counties and

8For a copy ofthe comment letter, see document

number EPA-R09-OAR-2012-0398-0079 in www.regulations.govunder docket ID EPA-R09-
OAR-2012-0398. that there is "no gap in coverage ofthese requirements" between the state statutes and the county regulations. The State highlights the disclosure provisions of ARS 38-508, including the alternate

measures implemented when a conflict exists, and notes that "not all conflicts ofinterest can be identified or even exist at the time ofappointment to a board or agency."

Response#1: As outlined inthe TSD for our proposal notice, we agree with ADEQ that Arizona's conflict ofinterest
statutes (ARS Title 38, Chapter 3, Article 8) 9 apply to all public agency officers and employees, whether atthe State, County, or Citylevel, that approve permits or enforcement orders. Furthermore, we agree thatthe term "any decision of a public agency" in Arizona under ARS 38-503(B)
encompasses the approval ofboth permits and enforcement orders. However, we do not agree that theboard membership requirements of section 128(a)(1) are adequately addressed by the recusal requirement ofARS 38- 503(B). The plain language ofsection 128(a)(1) establishes requirements regarding membership on aboard, and
not merely arequirement regarding a member's action on any particular permit or enforcement order.

Section 128(a)(1) ofthe CAA provides: "Each applicable plan shall contain requirements that * * * any board or body which approves permits

or enforcement orders under [the Act] shall have at least a majority ofmembers who represent the public interest and do
not derive any significant portion of their income from persons subject to permits and enforcement orders under [the Act]." Two elements ofthis provision prevent it frombeing satisfied by recusal alone.

First, the "public interest" and "significant income" requirements of section 128(a)(1) apply to a "majority of members" of a "board orbody which approves permits or enforcement orders under [the CAA]." The use ofthe plural in "permits" and "orders" tends to indicate that the relevant board or body is definedby its authority to approve permits and enforcement orders, and
not by the particular subset ofthe board acting on a single given permit or enforcement order. Aboard member may recuse himself from a particular

9EPA proposed to approve ARS Title 38, Chapter 3, Article 8 ("Conflict ofInterest ofOfficers and Employees") statutes on conflict ofinterest, as well

as several statutes related to hearing boards and orders ofabatement, into the Arizona SIP with respect to the requirements ofCAA section 128. For the listing ofthe specific statutes, see 77 FR44555
at 44558. The finalrule approving these statutes into the SIP is happening concurrent with today's action. permit or enforcement order proceeding in order to avoid a conflict ofinterest and yet remain a member ofthatboard. Under these circumstances, his conflict ofinterest must still be considered in determining whether the board as a whole meets the majority membership requirement of section 128(a)(1).

Second, the "significant portion of income" requirement is determined by reference to "persons subject to permits

orenforcement orders". A permit holder is legallybound by a permit and is therefore "subject to" it. Similar reasoning applies to a person legally bound by a final enforcement order. Any reasonable interpretation of "subject to" must at a minimum include
persons already legallybound by a final permit or final enforcement order. Yet a recusal requirement, such as that provided by ARS 38-503(B), fails to

ensure that a majority ofmembers do
not derive a significant portion oftheir income from persons who already have permits or are already under a final enforcement order.

Thus, even assuming, for argument's sake, that ARS 38-503(B) could meet the "public interest" requirement of section 128(a)(1), itclearly does not,by itself, fulfill the "significant income" requirement. This interpretation is consistent with EPA's existing guidance

on Section 128. In particular, in 1978, EPA issued a guidance memorandum 10 that suggested definitions ofcertain
terms in section 128. Although the guidance did not specifically mention recusal, itdid suggest that the term "persons subject to permits or enforcement orders under this Act" includes, among others, "any individual, corporation, partnership, or association who holds * * * any permit, or who is * * * subject to any enforcement order under the [Act]". In other words, EPA's guidance recommended that "persons subject to permits or enforcement orders" should include those persons legally bound to

apermit or enforcement order. The guidance also suggested that the term "majority ofmembers" be defined as "a majority ofall members ofa board or body having or sharing authority to approve permits or enforcement orders under the [CAA], and a majority of members making up any panel offewer than all members (includingpanels of a single member) where individual permits or orders are considered by such a panel". Thus, EPA interprets the statutory language of section 128(a)(1) as

10Memorandum from David 0. Bickart, Deputy General Counsel, to Regional Air Directors, "Guidance to States for Meeting Conflict of Interest Requirements of Section 128," March 2, 1978. 

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requiring a majority ofmembers ofthe entire board to meet the public interest and significant income requirements. EPA's guidance reflected thatreading of the statute.

While we agree that, at the time of appointment to a board or agency, it is
not possible to identify future conflicts ofinterest that may result fromfuture permits or enforcement orders, we note that itispossible to identify a prospective or current board member's interest in current permit holders and
persons currently under final enforcement orders. Thus, this particular part ofADEQ's comment letter is not directly relevant to the deficiency in question.

Arizona's conflict ofinterest statutes thus leave a gap with respect to the CAA section 128(a)(1) requirement that boards that approve permits or enforcement orders have "at least a majority ofmembers who represent the public interest and donot derive any significant portion oftheirincome from
persons subject to permits and enforcement orders under [the Act]." However, Arizona's county hearing board statute, ARS 49-478, which we proposed to approve and thus to incorporate into the Arizona SIP, requires that, for county air quality hearing boards, "[a]t least three [offive] members shall not have a substantial interest, as defined in [ARS] 38-502, in any person required to obtain apermit pursuant to this article." Thus, ARS 49- 478 partially fills the gap between the Arizona conflict ofinterest statutes and the board membership requirements of CAA section 128(a)(1) by establishing a majority membership requirement.

As noted in our proposal, Pima County Code 17.04.190 extends this majority membership requirement to interests in persons subject to enforcement orders. See 77 FR 44555 at 44557. Such a provision couldbe submitted for incorporation into the Arizona SIP. However, Arizona has not submitted this or other provisions for incorporation into the SIP that would require that a majority ofmembers of the County Boards represent the public interest and do not derive any significant portion oftheirincome from
persons subject to enforcement orders. Therefore, we are finalizing our partial approval and narrow, partial disapproval as proposed.

Comment#2:ADEQstates thatEPA failed to comply with section 552 ofthe Administrative Procedure Act (APA), which requires publication in the Federal Register of amendments and revisions to substantive rules ofgeneral applicability and statements ofgeneral policy or interpretations ofgeneral applicability formulated and adopted by the agency. Specifically, ADEQ asserts that EPA has not issued guidance of general applicability on CAA section 128 since 1978 and that the 1978 guidance memo was "severely lacking." The State references footnote #5 ofour proposal (see 77 FR 44555 at 44556) and
states that "EPA lacks authority to single out Arizona and create specific retroactive guidance applicable to it, after [Arizona] has submitted the required SIP and SIP Supplement(s)" and that EPA bears responsibility to be transparent and predictable inthe planning process. ADEQstates thatEPA
proposes to change certain interpretations ofsection 128by proposing interpretations on a "case-bycase basis for individual states" andthat such a process violates APA section 552. Finally, by reference toEPA's infrastructure SIP rulemaking on Hawaii that we cited in our Arizona section 128 proposal, ADEQ states that EPA did not provide public notice and opportunity
to comment on proposed amendments

or revisions to the 1978 guidance.

Response#2:We do not agree that our action violates the APA. While EPA understands ADEQ's interest in having EPA issue comprehensive, generally applicable guidance on section 128, it is
not always possible to anticipate all potential issues or questions that may arise in reviewing SIP submittals in advance ofthe deadlines for such SIP submittals. Therefore, it is often
necessary for EPA to make certain judgments about proper application of the statutory requirements ofthe CAA

on a case-by-case basis, as it acts on individual SIP submissions. The noticeand-comment rulemaking procedures followed by EPA in acting on SIP submissions allow for states and other interested parties to weigh in on these case-by-case judgments. This process is what naturally follows when EPA issues guidance making recommendations concerning how states could correctly comply withthe statute, but new issues arise in the application ofthe guidance in rulemaking on a SIP submission.

In this case, the interpretations referred to in our proposal and set out in our TSD I"were intended to clarify

11Footnote 3 ofADEQ's comment letterindicates that ADEQ was unable to find explanation ofEPA's reasoning in the TSD. Itappears that ADEQ was looking at the more general TSD associated with the earlier proposal on otherportions ofArizona's infrastructure SIP (i.e., 77 FR 38239, June 27, 2012, docket ID EPA-R09-OAR-2012-0398, document number EPA-R09-OAR-2012-0398-0003) rather than the separate Section 128 TSD, which was available at www.regulations.gov(i.e., document number EPA-R09-OAR-2012-0398-0075, under the same docket ID). Thus, while this misunderstanding is unfortunate, we disagree that previously issued guidance pertaining
to section 128 in relation to the Arizona infrastructure SIP. In particular, we wished to clarify that the requirements of 128(a)(1) apply only to boards or bodies composed ofmultiple individuals and do not apply where a single individual approves permits or enforcement orders under the CAA. As explained in the TSD for our proposal, this interpretation derives from the text of section 128 itself (seeTSD at pages 1-3). However, the 1978 memorandum suggests a definition of "board orbody" that includes "any individual * * * authorized to approve permits or enforcement orders under the Clean Air Act." In Arizona's case, a strict adherence to the recommendations of the guidance would have rendered the Director ofADEQ, the state administrative lawjudges and the county controls officers all subject to the "public interest" and "significant income" requirements of 128(a)(1). As explained in the TSD for our proposal, this interpretation seems inconsistent with the plain language ofthe statute;

we therefore instead proposed and took
comment on the interpretation that subsection 128(a)(1) should not apply to heads ofexecutive agencies who
approve permits or enforcement orders. Similarly, the other interpretations of the statute set forth in our TSD were intended to clarify ambiguities left by the recommendations ofthe 1978 guidance, so that we could properly evaluate Arizona's submittal underthe requirements ofthe Act.

While we do not necessarily agree that these interpretations are subject to the requirements ofAPA section 552,

we note that our proposal, as published in the Federal Register, specifically referred to these interpretations (see77 FR 44555 at 44556), and that we explained these interpretations in detail in the TSD available in the docket for

our proposal (seeTSD at pages 1-3). Moreover, the proposed interpretations in our proposal on Arizona are consistent with other recent notices that EPA has published in the Federal Register. 12 Comment#3:ADEQclaims that compliance with "EPA's unauthorized amendment or revision to its 1978 guidance is practically infeasible" because EPA's "revised or amended interpretation has not occurred until after the 2012 legislature has adjourned." As such, the State claims

our TSD was "lacking clarity" orthat our explanation did "not appear under that specific section in the TSD," as asserted by ADEQ.

12E.g., 77 FR 21913, April 12, 2012 (for Hawaii); and 77 FR 22540, April 16, 2012 (for North Dakota).

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that itdid not havethe opportunity to revise its statutes or amend its prior submittal ofOctober 14, 2009 orparallel process submittal ofJune 1, 2012 prior
to the submittal deadline.

Response#3: Forthe reasons explained in Response #2, we disagree with ADEQ's assertion that EPA has made "unauthorized amendment or revision to its 1978 guidance." With respect to ADEQ's argument regarding timing ofthe legislative session and opportunity to revise statutes or SIP submittals, we disagree that compliance with CAA section 128, in light ofthe 1978 guidance and the clarifying interpretations presented in our proposal, is practically infeasible, to the
extent that "practical infeasibility" is

even an allowable consideration in EPA's action on a SIP submission.

Our final, partial disapproval triggers

atwo-year deadline for EPA to promulgate a federal implementation plan (FIP)for the identified deficiency. However, the State can remedy the deficiency prior to such FIP promulgation. IfADEQcan submit a SIP revision that meets EPA approval within the next two years, EPA's obligation to promulgate a FIP would be discharged.

As noted in the TSD, the CAA requires that section 128 must be implemented through SIP-approved, federally enforceable provisions. However, the Act does not prescribe the
exact means ofimplementation. The
state and counties now have the opportunity to consider statutory or regulatory revisions to submit to EPA as

a SIP revision to remedy this narrow deficiency. We stand ready to work with ADEQ and Maricopa, Pima, and Pinal counties to develop this revision.

III. FinalAction

EPA is approving in part and disapproving in part the Arizona Infrastructure SIP Submittals forthe 1997 ozone, 1997 PM2. 5, and 2006 PM2.5 NAAQS. EPA is approving the Arizona Infrastructure SIP with respect to the following requirements:

* Section 110(a)(2)(A): Emission limits and other control measures.

* Section 110(a)(2)(B): Ambient air quality monitoring/data system.

* Section 110(a)(2)(C) (inpart): Program for enforcement of control

measures and regulation ofnew and modified stationary sources.

* Section 110(a)(2)(D)(i)(I): Interstate transport (for 2006 24-hour PM2.5 NAAQS).1 3 14

13EPA previously approved anearlier SIP submission from Arizona as fully satisfying the interstate transport SIP requirements of CAA section 110(a)(2)(D)(i) for the 1997 ozone and 1997
PM2.5 NAAQS. 72 FR 41629 (July 31, 2007). * Section 110(a)(2)(D)(ii) (inpart): Interstate pollution abatement and international air pollution. * Section 110(a)(2)(E)(i): Adequate

resources and legal authority. * Section 110(a)(2)(E)(ii) (inpart): Conflict ofinterest. * Section 110(a)(2)(E)(iii): State oversight oflocal orregional government agencies. * Section 110(a)(2)(F)(in part): Stationary source monitoring and reporting. * Section 110(a)(2)(G): Emergency episodes (for 1997 and 2006 PM2.5). * Section 110(a)(2)(H): SIP revisions. * Section 110(a)(2)(J) (inpart): Consultation with government officials and public notification. * Section 110(a)(2)(L): Permitting fees. * Section 110(a)(2)(M): Consultation/ participation by affected local entities.

In addition, we are approving into the SIP certain statutory and regulatory provisions included in the 2009 Infrastructure SIP. These are discussed further in our proposal notices, accompanying TSDs, and in Arizona's August 24, 2012 submittal, all available in the docket for today's action. Simultaneously, EPA is disapproving Arizona's Infrastructure SIP submittals for 1997 ozone, 1997 PM 2.5 , and 2006 PM2.5NAAQS with respect tothe following infrastructure SIP requirements:

* Section 110(a)(2)(C) (in part): Permit program for regulation ofnew and modified stationary sources under part C oftitle I ofthe Act (prevention of significant deterioration (PSD)).

* Section 110(a)(2)(D)(i)(II): Provision
to prohibit interference with other states' PSD measures (for 2006 24-hour PM2. 5NAAQS). 15

14With respect to Arizona's section 110(a)(2)(D)(i)(I) interstate transport SIP submission
for the 2006 24-hour PM 2.5NAAQS, the recent opinion vacating the Transport Rule,EMEHomer City Generationv. EPA, No. 11-1302 (D.C. Cir., August 21, 2012), does not alter our conclusion that
the existing Arizona SIP adequately addresses this requirement. Nothing in the Homer City opinion disturbs or calls into question that conclusion orthe validity ofthe technical information on which our July 30, 2012 proposal (77 FR 44551) relied-e.g., ambient PM 2.5levels at monitoring sites representative ofregional background in nearby
states and relevant meteorological and topographical information. In addition, nothing in that opinion undermines our proposed conclusion,
based on our review ofthe available technical information, that emissions from Arizona do not significantly contribute to nonattainment or interfere with maintenance ofthe 2006 24-hour PM2.5NAAQS inanother state.

15 EPA previously approved an earlier SIP submission from Arizona as fully satisfying the
interstate transport SIP requirements ofCAA section 110(a)(2)(D)(i) for the 1997 ozone and 1997
PM2.5 NAAQS. 72 FR41629 (July 31, 2007). * Section 110(a)(2)(D)(ii) (inpart): Interstate pollution abatement and international air pollution.

* Section 110(a)(2)(E)(ii) (inpart): Conflict ofinterest.

* Section 110(a)(2)(F) (inpart): Stationary source monitoring and reporting.

* Section 110(a)(2)(J) (in part): PSD. * Section 110 (a)(2)(K): Air quality modeling and submission ofmonitoring data.

On June 1, 2012 ADEQsubmitted the "Proposed Supplement to the Arizona State Implementation Plan under Clean Air act Section 110(a)(1) and (2): Implementation of [1997 PM2.5 and 8- hour ozone NAAQS and 2006 PM2.5 NAAQS], Parallel Processing Version" ("2012 Supplement"). The 2012 Supplement included a number of
statutes and regulations that were effective under state lawbut had not been adopted specifically for submittal
to EPA as a SIP revision under CAA section 110. On August 24, 2012, ADEQ provided EPA with evidence that the laws and regulations in the 2012 Supplement have been adopted specifically for submittal to EPA as a SIP revision with the exception oftwo Pima County regulations (rules 17.12.040 and 17.24.040). As explained in our notice ofproposed rulemaking,

our proposed approval ofCAA section 110(a)(2)(F) was contingent upon receipt offully adopted versions ofthe two Pima County regulations discussed above. We proposed in the alternative to disapprove the 2009 Infrastructure SIP with respect tothe requirements ofCAA section 110(a)(2)(F) in Pima County, if ADEQ did not submit the twoPima County regulations as SIP revisions following all required state and local procedures.16 Consequently, in the absence ofthe aforementioned Pima County regulations, we are disapproving Arizona's infrastructure SIP for section 110(a)(2)(F) with respect to Pima County.

As explained in the NPRs andTSD,

our disapprovals related to sections 110(a)(2)(C), (D)(i)(II), (D)(ii), (J), and (K)
result from the conclusion that the Arizona SIP does not fully satisfy the statutory and regulatory requirements for PSD permit programs under part C oftitle Iofthe Act. Forthese disapprovals, both the Maricopa County Air Quality Department and the Pima County Department ofEnvironmental Quality currently implement the Federal PSD program in 40 CFR 52.21 for all regulated NSR pollutants, pursuant to delegation agreements with EPA. 40

16See 77 FR 38239, 38244 (June 27, 2012). 

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CFR 52.144.17 Accordingly, although the Arizona SIP remains deficient with respect to PSD requirements inboth Maricopa and Pima counties, these deficiencies are adequately addressed in both areas bythe Federal PSD program. ADEQ implements a SIP-approved PSD program for all regulated NSR pollutants except for PM-10 and GHGs 18 (48 FR 19878, May 3, 1983), and the Pinal County Air Quality Control District (PCAQCD) implements a SIP-approved PSD program for all regulated NSR pollutants except for GHGs 19 (61 FR 15717, April 9, 1996, as amended by 65 FR 79742, December 20, 2000). EPA understands thatboth ADEQ and the PCAQCD intend to submit, in the near future, PSD SIP revisions addressing the deficiencies identified in our TSD.2 0
EPA takes a disapproval ofa state plan very seriously. Rather than implement a FIP, we believe that itis preferable, and preferred in the provisions ofthe Clean Air Act, for
states to implement the CAA requirements through state provisions that are developed and adopted by the
state and approved into the SIP byEPA. A state plan need not contain exactly the same provisions that EPA might require, but EPA must be able to find that the state planis consistent with the requirements ofthe Act, in accordance with its obligations under section 110(k). Further, EPA's oversight role

17See 59 FR 1730 (January 12, 1994) and "Agreement for Delegation ofAuthority ofthe Regulations for Prevention ofSignificant Deterioration ofAir Quality (40 CFR 52.21) Between U.S. EPA and [Maricopa County]," executed
November 22, 1993; "Agreement for Delegation of Authority ofthe Regulations for Prevention of Significant Deterioration of Air Quality (40 CFR 52.21) Between U.S. EPA and Pima County Air Quality Control District," executed April 14, 1994.

18ForPM-10 and GHGs, ADEQimplements the Federal PSD program in40 CFR 52.21 pursuantto delegation agreements executed in 1999 and 2011, respectively. 40 CFR 52.37; "Agreement for Delegation of Authority ofthe PM-10 Regulations for Prevention of Significant Deterioration of Air Quality (40CFR 52.21) Between EPA and Arizona DEQ," executed March 12, 1999; "U.S. EPAArizona Department ofEnvironmental Quality Agreement for Delegation ofAuthority to Issue and Modify Greenhouse Gas Prevention ofSignificant Deterioration Permits Subject to 40CFR 52.21,"
executed March 30, 2011.

19ForGHGs, Pinal County implements the Federal PSD program in40 CFR 52.21 pursuantto

a delegation agreement executed in 2011. 40CFR 52.37; "U.S. EPA-Pinal County Air Quality Control District Agreement forDelegation of Authority to Issue and Modify Greenhouse Gas Prevention ofSignificant Deterioration Permits Subject to 40 CFR 52.21," executed August 10,
2011.

20On April 10, 2012, ADEQ submitted draft PSD
program regulations to EPA with a request for "parallel processing" under 40CFR part 51, appendix V.We intend to act on this PSD submittal expeditiously upon receipt ofan official SIP revision containing ADEQ's fully adopted PSD regulations. requires that it assure consistent implementation ofClean Air Act requirements by states across the country, even while acknowledging that individual decisions from source to

source or state to state may not have identical outcomes. EPA believes these disapprovals are the only path thatis consistent with the Act atthis time.

Under section 179(a) ofthe CAA, final disapproval ofa submittal that addresses a requirement ofpart D oftitle I ofthe CAA (CAA sections 171-193) or is required in response to afinding of substantial inadequacy as described in CAA section 110(k)(5) (SIP Call) starts a sanctions clock. The Arizona Infrastructure SIP was not submitted to meet either ofthese requirements. Therefore, our partial disapproval of Arizona's Infrastructure SIP Submittals does not trigger mandatory sanctions under CAA section 179.

In addition, CAA section 110(c)(1) provides thatEPA must promulgate a FIP within twoyears after finding that

a State has failedto make arequired submission or disapproving a State implementation plan submission in whole orin part, unless EPA approves
a SIP revision correcting the deficiencies within that two-year period. For the reasons provided in our proposed rules and associated TSDs, and in our responses to comments above, EPA is partially disapproving Arizona's Infrastructure SIP Submittals based on our conclusion that it does not fully satisfy the following CAA section 110(a)requirements: (1)With respect to those areas under ADEQ and Pinal County jurisdiction, the PSD program requirements ofCAA sections 110(a)(2)(C), 110(a)(2)(D)(i)(11), 110(a)(2)(D)(ii), 110(a)(2)(J), and 110(a)(2)(K) regarding regulation of nitrogen oxides (NOx)as an ozone precursor, regulation offine particulate
matter (PM2
. 5), interstate pollution abatement, and air quality models and modeling data; (2)withrespect to the air quality hearing boards in Maricopa, Pima, and Pinal counties, the requirements ofCAA section 110(a)(2)(E)(ii) respecting board composition requirements under CAA section 128(a)(1); and (3)with respect to Pima County, the requirements ofCAA section 110(a)(2)(F) regarding stationary

source monitoring and reporting. Our partial disapproval ofArizona's Infrastructure SIP Submittalsbased on these deficiencies triggers an obligation

on EPA topromulgate a FIP under CAA section 110(c), unless Arizona submits and EPA approves SIP revisions correcting the identified deficiencies within two years ofthe effective date of this final rule. We encourage the state to submita SIP revision to address the deficiencies identified in this final rule and we stand ready to work with the
state to develop a revised plan.

IV. Statutory andExecutive Order Reviews

A. Executive Order12866,Regulatory PlanningandReview

This action is not a "significant regulatory action" under the terms of Executive Order (EO) 12866 (58 FR 51735, October 4, 1993) and is therefore
not subject toreview under the EO.

B. Paperwork ReductionAct
This action does not impose an information collection burden under the provisions ofthe Paperwork Reduction Act, 44 U.S.C. 3501 et seq., because this partial approval and partial disapproval ofSIP revisions under CAA section 110 will not in-and-ofitself create any new information collection burdens but simply approves certain State requirements, and disapproves certain other State requirements, for inclusion into the SIP. Burden is defined at 5CFR 1320.3(b).

C.RegulatoryFlexibility Act
The Regulatory Flexibility Act (RFA) generally requires an agency to conduct

aregulatory flexibility analysis ofany rule subject to notice and comment rulemaking requirements unlessthe agency certifies that the rule will not have a significant economic impact on

a substantial number of small entities. Small entities include smallbusinesses, small not-for-profit enterprises, and small governmental jurisdictions. For purposes of assessing the impacts of today's rule on small entities, small entity is defined as: (1)A smallbusiness

as defined by the Small Business Administration's (SBA) regulations at 13 CFR 121.201; (2)a small governmental jurisdiction that is a government of a city, county, town, school district or special district with a population ofless than 50,000; and (3)a small organization that is any not-for-profit enterprise which isindependently owned and operated and is not dominant in its field.

After considering the economic impacts oftoday's rule on small entities, I certify that this action will not have a significant impact on a substantial number ofsmall entities. This rule does
not impose any requirements or create impacts on small entities. Thispartial SIP approval and partial SIP disapproval under CAA section 110 will
not in-and-of itselfcreate any new requirements but simply approves certain State requirements, and

### Federal Register/Vol. 77, No. 214/Monday, November 5, 2012/Rules and Regulations

disapproves certain other State requirements, for inclusion into the SIP. Accordingly, it affords no opportunity for EPA to fashion for small entities less burdensome compliance or reporting requirements or timetables or exemptions from all or part ofthe rule. Therefore, this action will not have a significant economic impact on a substantial number of small entities.

D. UnfundedMandatesReformAct

This action contains no Federal mandates under the provisions ofTitle II ofthe Unfunded Mandates Reform Act of 1995 (UMRA), 2U.S.C. 1531- 1538 for State, local, or tribal governments or the private sector. EPA has determined that the partial approval andpartial disapproval action does not include a Federal mandate that may result in estimated costs of$100 million

ormore to either State, local, or tribal governments in the aggregate, or to the private sector. This action approves certain pre-existing requirements, and disapproves certain other pre-existing requirements, under State or local law, and imposes no newrequirements. Accordingly, no additional costs to State, local, or tribal governments, or to the private sector, result fromthis action.

E.Executive Order13132,Federalism

Executive Order 13132, entitled "Federalism" (64 FR 43255, August 10, 1999), requires EPA to develop an accountable process to ensure "meaningful and timely inputby State and local officials in the development of regulatory policies thathave federalism implications." "Policies that have federalism implications" is defined in the Executive Order to include regulations thathave "substantial direct effects on the States, on the relationship between the national government and the States, or on the distribution of
power and responsibilities among the various levels ofgovernment."

This action does not have federalism implications. It will nothave substantial direct effects on the States, onthe relationship between the national government and the States, or on the distribution ofpower and responsibilities among the various levels ofgovernment, as specified in Executive Order 13132, because it merely approves certain State requirements, and disapproves certain other State requirements, for inclusion into the SIP and does not alter the relationship or the distribution ofpower andresponsibilities established in the Clean Air Act. Thus,Executive Order 13132 does not apply to this action. F.Executive Order13175, Coordination With IndianTribalGovernments

This action does not have tribal implications, as specified in Executive Order 13175 (65 FR 67249, November 9, 2000), because the SIP on which EPA is taking action would not apply in Indian country located in the state, and EPA
notes that it will notimpose substantial direct costs on tribal governments or preempt tribal law. Thus, Executive Order 13175 does not apply to this action.

G. Executive Order13045, Protectionof ChildrenFromEnvironmentalHealth Risks andSafetyRisks

EPA interprets EO 13045 (62 FR 19885, April 23, 1997) as applying only
to those regulatory actions that concern health or safety risks, such that the analysis required under section 5-501 of the EO has the potential to influence the regulation. This action is not subject to EO 13045because itis not an economically significant regulatory action based on health or safety risks subject toExecutive Order 13045 (62 FR 19885, April 23, 1997). This partial approval and partial disapproval under CAA section 110 will not in-and-of itself
create any new regulations but simply
approves certain State requirements, and disapproves certain other State requirements, for inclusion into the SIP.

H. Executive Order13211,Actions That Significantly Affect EnergySupply, Distribution,or Use

This rule is not subject to Executive Order 13211 (66 FR 28355, May 22, 2001)because itisnot a significant regulatory action under Executive Order 12866.

L NationalTechnologyTransferand AdvancementAct
Section 12(d) ofthe National Technology Transfer and Advancement Act of1995 ("NTTAA"), Public Law. 104-113, 12(d) (15 U.S.C. 272 note) directs EPA to use voluntary consensus standards in its regulatory activities unless to do so would be inconsistent with applicable law or otherwise impractical. Voluntary consensus standards are technical standards (e.g., materials specifications, test methods, sampling procedures, andbusiness practices) that are developed or adopted byvoluntary consensus standards bodies. NTTAA directs EPA toprovide Congress, through OMB, explanations when the Agency decides not to use available and applicable voluntary

consensus standards.

The EPA believes that this action is
not subject to requirements of Section 12(d) ofNTTAA because application of those requirements wouldbe inconsistent with the Clean Air Act.

J.Executive Order12898:Federal Actions ToAddressEnvironmental Justicein MinorityPopulations and Low-Income Population

Executive Order (EO) 12898 (59 FR 7629 (Feb. 16, 1994)) establishes federal executive policy on environmental justice. Its main provision directs federal agencies, to the greatest extent practicable and permitted by law,to make environmental justice part oftheir mission by identifying and addressing,

as appropriate, disproportionately high and adverse human health or environmental effects oftheir programs, policies, and activities on minority populations and low-income populations in the United States.

EPA lacks the discretionary authority
to address environmental justice in this rulemaking.

K. Congressional ReviewAct

The Congressional Review Act, 5 U.S.C. 801 et seq., as added by the Small Business Regulatory Enforcement Fairness Act of 1996, generally provides thatbefore a rule may take effect, the
agency promulgating the rulemust submita rule report, which includes a copy ofthe rule, to each House ofthe Congress and to the Comptroller General ofthe United States. EPA will submit a report containing this rule and other required information to the U.S. Senate, the U.S. House ofRepresentatives, and the Comptroller General ofthe United States prior to publication ofthe rule in the Federal Register. A majorrule
cannot take effect until 60 days after it is published in the Federal Register. This action is not a "major rule" as defined by 5U.S.C. section 804(2). This rule will be effective onDecember 5, 2012.

L. Petitions forJudicial Review

Under section 307(b)(1) ofthe Clean Air Act, petitions forjudicial review of this action must be filed inthe United States Court ofAppeals for the appropriate circuit byJanuary 4, 2013. Filing a petition for reconsideration by the Administrator ofthis final rule does
not affect the finality ofthis rule for the
purposes ofjudicial review nor does it extend the time within which apetition forjudicial review maybe filed, and shall not postpone the effectiveness of suchrule or action. This action may not be challenged later in proceedings to enforce its requirements (see section 307(b)(2)). 

### 66403

### 66404 Federal Register/Vol. 77, No. 214/Monday, November 5, 2012/Rules and Regulations

List of Subjects in 40 CFRPart52

Environmental protection, Air pollution control, Incorporation by reference, Intergovernmental relations, Oxides ofnitrogen, Ozone, Particulate matter, Reporting and recordkeeping requirements, Volatile organic compounds.

Dated: September 28, 2012.
JaredBlumenfeld, RegionalAdministrator, RegionIX.

Part 52, Chapter I, Title 40 ofthe Code ofFederal Regulations is amended as follows:

PART 52-[AMENDED]

m 1. The authority citation for Part52 continues to read as follows:

Authority:42 U.S.C. 7401 etseq. Subpart D-Arizona

* 2.Section 52.120 is amended by adding paragraphs (c)(152)(ii) and (c)(153) to read as follows:

§52.120 Identificationof plan.

(c) * * * (152) * * * 

### (i)* * * (ii)Additional materials. (A) Arizona Department of Environmental Quality. (1) "Final Supplement tothe Arizona State Implementation Plan under Clean Air Act Section 110(a)(1) and (2): Implementation of2006 PM2.5National Ambient Air Quality Standards, 1997 PM2.5National Ambient Air Quality Standards, and 1997 8-Hour Ozone National Ambient Air Quality Standards," August 2012, adoptedby the Arizona Department of Environmental Quality on August 24, 2012, excluding the appendices.

(2)Arizona Revised Statutes (West's, 2011-2012 Compact Edition):

(i)Title 28 (transportation), chapter 7 (certification oftitle and registration), article 5 (registration requirements generally), section 28-2153 ("Registration requirement; exceptions; assessment; violation; classification"); (ii)Title 35 (public finances), chapter 2 (handling ofpublic funds), article 2 (state management ofpublic monies), section 35-313 ("Investment oftrust and treasury monies; loan of securities");

(iii) Title 38 (public officers and employees), chapter 1 (general provisions), article 1 (definitions), section 38-101 ("Definitions") and article 8 (conflict ofinterest ofofficers and employees), sections 38-501 ("Application of article"), 38-502 ("Definitions"), 38-503 ("Conflict of interest; exemptions; employment prohibition"), 38-504 ("Prohibited acts"), 38-505 ("Additional income prohibited for services") 38-506 ("Remedies"), 38-507 ("Opinions ofthe attorney general, county attorneys, city

or town attorneys and house and senate ethics committee"), 38-508 ("Authority ofpublic officers and employees to act"), 38-509 (Filing ofdisclosures"), 38-510 ("Penalties"), and 38-511 ("Cancellation ofpolitical subdivision and state contracts; definition"); (iv)Title 49 (the environment), chapter 1 (general provisions), article 1 (department ofenvironmental quality), section 49-103 ("Department employees; legal counsel"), subsections (A)(2), (A)(4), (B)(3), and (B)(5) of section 49-104 ("Powers and duties of the department and director"), and sections 49-106 ("Statewide application ofrules") and 49-107 ("Local delegation of state authority"); (v)Title 49 (the environment), chapter 3 (air quality), article 1 (general provisions), section 49-405 ("Attainment area designations"); article 2 (state air pollution control), sections 49-421 ("Definitions"), 49-422 ("Powers and duties"), 49-424 ("Duties ofdepartment"), 49-425 ("Rules; hearing"), 49-433 ("Special inspection warrant"), 49-435 ("Hearings on orders of abatement"), and 49-441 ("Suspension and revocation of conditional order"), subsections (A) and (B)(2) ofsection 49-455 ("Permit administration fund"), and sections 49- 460 ("Violations; production of records"), 49-461 ("Violations; order of abatement"), 49-462 ("Violations; injunctive relief"), 49-463 ("Violations; civil penalties"), and 49-465 ("Air pollution emergency"); and article 3 (countyair pollution control), sections 49-471 ("Definitions"), 49-473 ("Board of supervisors"), 49-474 ("County control boards"), 49-476.01 ("Monitoring"), 49-478 ("Hearing board"), 49-479 ("Rules; hearing"), 49- 480.02 ("Appeals ofpermit actions"), 49-482 ("Appeals to hearing board"), 49-488 ("Special inspection warrant"), 49-490 ("Hearings on orders of abatement"), 49-495 ("Suspension and revocation ofconditional order"), 49- 502 ("Violation; classification"), 49-510 ("Violations; production ofrecords"), 49-511 ("Violations; order of abatement"), 49-512 ("Violations; injunctive relief"), and 49-513 ("Violations; civil penalties").

(153) The following plan was submitted on October 14, 2009, bythe Governor's designee. (i) [Reserved] (ii)Additional materials. (A) Arizona Department of Environmental Quality. (1) "Arizona State Implementation Plan Revision under Clean Air Act Section 110(a)(1) and (2): Implementation of2006 PM2.5National Ambient Air Quality Standards, 1997 PM2.5National Ambient Air Quality Standards, and 1997 8-Hour Ozone National Ambient Air Quality Standards," September 2009, adopted by the Arizona Department of Environmental Quality on October 14, 2009, excluding the appendices.

* 3.Section 52.123 is amended by adding paragraphs (1), (in), and (n)to read as follows: 

### §52.123 Approvalstatus.

(1)19978-hourozoneNAAQS: The SIPs submitted on October 14, 2009 and August 24, 2012 are fully orpartially disapproved for Clean Air Act (CAA) elements 110(a)(2)(C), (D)(ii), (J)and (K) for allportions of the Arizona SIP; for CAA element 110(a)(2)(E)(ii) for the Maricopa County, Pima County, and Pinal County portions ofthe Arizona SIP; and for CAA element 110(a)(2)(F) for the Pima County portion ofthe Arizona SIP.
(in) 1997PM2.5 NAAQS: The SIPs submitted on October 14, 2009 and August 24, 2012 are fully orpartially disapproved for Clean Air Act (CAA) elements 110(a)(2)(C), (D)(ii), (J)and (K) for allportions of the Arizona SIP; for CAA element 110(a)(2)(E)(ii) for the Maricopa County, Pima County, and Pinal County portions ofthe Arizona SIP; and for CAA element 110(a)(2)(F) for the Pima County portion ofthe Arizona SIP. (n)2006PM 2.5NAAQS: The SIPs submitted on October 14, 2009 and August 24, 2012 are fully orpartially disapproved for Clean Air Act (CAA) elements 110(a)(2)(C), (D)(i)(II) (interfere with measures in any other state to prevent significant deterioration of air quality), (D)(ii), (J)and (K)for all portions ofthe Arizona SIP; for CAA element 110(a)(2)(E)(ii) for the Maricopa County, Pima County, and Pinal County portions ofthe Arizona SIP; andfor CAA element 110(a)(2)(F) for the Pima County portion ofthe Arizona SIP.

[FRDoe. 2012-26322 Filed 11-2-12; 8:45 am]

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