[Federal Register Volume 60, Number 91 (Thursday, May 11, 1995)]
[Rules and Regulations]
[Pages 25143-25146]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-11677]



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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 70

[MT-001; FRL-5206-2]


Clean Air Act Final Interim Approval of Operating Permits 
Program; State of Montana

AGENCY: Environmental Protection Agency (EPA).

ACTION: Final interim approval.

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SUMMARY: The EPA is promulgating final interim approval of the 
Operating Permits Program submitted by the State of Montana for the 
purpose of complying with Federal requirements for an approvable State 
Program to issue operating permits to all major stationary sources, and 
to certain other sources.

EFFECTIVE DATE: June 12, 1995.

ADDRESSES: Copies of the State's submittal and other supporting 
information used in developing the final interim approval are available 
for inspection during normal business hours at the following location: 
U.S. Environmental Protection Agency, Region 8, 999 18th Street, suite 
500, Denver, Colorado 80202.

FOR FURTHER INFORMATION CONTACT: Laura Farris, 8ART-AP, U.S. 
Environmental Protection Agency, Region 8, 999 18th Street, suite 500, 
Denver, Colorado 80202, (303) 294-7539.

SUPPLEMENTARY INFORMATION:

I. Background and Purpose

A. Introduction

    Title V of the 1990 Clean Air Act Amendments (sections 501-507 of 
the Clean Air Act (``the Act'')), and implementing regulations at 40 
Code of Federal Regulations (CFR) part 70 (part 70) require that States 
develop and submit operating permits programs to EPA by November 15, 
1993, and that EPA act to approve or disapprove each program within one 
year after receiving the submittal. The EPA's program review occurs 
pursuant to section 502 of the Act and the part 70 regulations, which 
together outline criteria for approval or disapproval. Where a program 
substantially, but not fully, meets the requirements of part 70, EPA 
may grant the program interim approval for a period of up to two years. 
If EPA has not fully approved a program by two years after the November 
15, 1993 date, or by the end of an interim program, it must establish 
and implement a Federal program.
    On February 14, 1995 EPA published a Federal Register notice 
proposing interim approval of the Operating Permits Program for the 
State of Montana (PROGRAM). See 60 FR 8335. EPA received no adverse 
comments on this proposed interim approval, and is taking final action 
to promulgate interim approval of the Montana PROGRAM.

II. Final Action and Implications

A. Analysis of State Submission

    The Governor of Montana submitted an administratively complete 
title V Operating Permit Program (PROGRAM) for the State of Montana on 
March 29, 1994. The Montana PROGRAM, including the operating permit 
[[Page 25144]] regulations (Sub-Chapter 20, sections 16.8.2001 through 
16.8.2025, inclusive, of the Administrative Rules of Montana), 
substantially meets the requirements of 40 CFR 70.2 and 70.3 with 
respect to applicability; 70.4, 70.5, and 70.6 with respect to permit 
content including operational flexibility; 70.5 with respect to 
complete application forms and criteria which define insignificant 
activities; 70.7 with respect to public participation and minor permit 
modifications; and 70.11 with respect to requirements for enforcement 
authority.
    EPA's comments noting deficiencies in the Montana PROGRAM were sent 
to the State in a letter dated October 3, 1994. The deficiencies were 
segregated into those that require corrective action prior to interim 
PROGRAM approval, and those that require corrective action prior to 
full PROGRAM approval. The State committed to address the PROGRAM 
deficiencies that require corrective action prior to interim PROGRAM 
approval in a letter dated October 20, 1994. The State submitted these 
corrective actions in letters dated March 30 and April 5, 1995. EPA has 
reviewed these corrective actions and has determined them to be 
adequate to allow for interim PROGRAM approval.

B. Final Action

    The EPA is promulgating interim approval of the Operating Permits 
Program submitted by the State of Montana on March 29, 1994. The State 
must complete the following corrective actions to receive full PROGRAM 
approval: (1) Section 16.8.2002(1)(d) of Sub-Chapter 20 is part of the 
definition of administrative permit amendment and allows for the 
department's discretion in determining whether or not a change in 
monitoring or reporting requirements would be as stringent as current 
monitoring or reporting requirements. This does not meet the criteria 
of an administrative permit amendment listed 40 CFR 70.7(d)(1)(iii), 
which requires that only more frequent monitoring or reporting 
requirements can be processed through an administrative permit 
amendment. Prior to full PROGRAM approval, the State must delete 
section 16.8.2002(1)(d) of Sub-Chapter 20, which allows for the 
department's discretion in determining whether or not a change in 
monitoring or reporting requirements would be as stringent as current 
monitoring or reporting requirements. (2) Section 16.8.2002(1)(f) of 
Sub-Chapter 20 is part of the definition of administrative permit 
amendment and allows the State to determine if other types of permit 
changes not listed in the definition of administrative permit amendment 
can be incorporated into a permit through the administrative permit 
amendment process. This does not meet requirements of 40 CFR 
70.7(d)(1)(vi). This provision must be changed prior to full PROGRAM 
approval to allow the Administrator of EPA (or EPA and the State) to 
determine if changes not included in the definition of administrative 
permit amendment can be processed through the administrative permit 
amendment process. (3) The definition of ``insignificant emissions 
unit'' in section 16.8.2002(22)(a) of Sub-Chapter 20 includes an 
emission threshold of 15 tons per year of any pollutant other than a 
hazardous air pollutant. EPA does not consider this to be a reasonable 
level from which to exempt emissions units from title V operating 
permit requirements. Prior to full PROGRAM approval, the State must 
lower the emissions cap for defining ``insignificant emissions units'' 
to assure they will not encompass activities that trigger applicable 
requirements. If the State defines insignificant activity levels 
greater than those suggested, a demonstration must be made to show why 
such levels are, in fact, insignificant. (4) Section 
16.8.2002(24)(a)(ii) of Sub-chapter 20 defines ``non-Federally 
enforceable requirement'' to include any term contained in a 
preconstruction permit issued under Sub-Chapters 9, 11, 17, or 18 that 
is not Federally enforceable. However, everything contained in a 
preconstruction permit issued under these Sub-Chapters (which currently 
are, or soon will be, included in the State's SIP) is considered to be 
Federally enforceable. Prior to full PROGRAM approval this language 
must be revised or deleted. (5) Section 16.8.2008 of Sub-Chapter 20 
that lists the permit content requirements does not require a 
severability clause consistent with Sec. 70.6(a)(5) of the Federal 
permitting regulation. Prior to full PROGRAM approval, the State must 
include a severability clause in Sub-Chapter 20 consistent with 
Sec. 70.6(a)(5) of the Federal permitting regulation. (6) Section 
IX.C.2 of the checklist that was part of the PROGRAM submittal 
regarding the implementation of the enhanced monitoring requirements of 
section 114(a)(3) of the Act states that there are no impediments to 
using any monitoring data to determine compliance and for direct 
enforcement. However, the State has incorporated by reference the 
Federal new source performance standards (NSPS) and national emissions 
standards for HAPs (NESHAPs) in 40 CFR parts 60 and 61 into its SIP-
approved regulations, which provide that compliance can be determined 
only by performance tests (see 40 CFR 60.11(a) and 40 CFR 61.12(a)). 
Prior to full PROGRAM approval, the State must provide an Attorney 
General's opinion verifying the State's authority to use any monitoring 
data to determine compliance and for direct enforcement. If the State 
does not have such authority, then the State's SIP-approved regulations 
must be revised prior to full PROGRAM approval to provide authority to 
use any monitoring data to determine compliance and for direct 
enforcement. (7) The Attorney General's Opinion regarding the State's 
authority to terminate permits is unclear. MCA 75-2-211(1) and 217(1) 
refer to ``issuance, modification, suspension, revocation, and 
renewal'' of permits, but not ``termination.'' Prior to full PROGRAM 
approval, the State must provide an Attorney General's interpretation 
that Montana's statutory authority extends to ``terminating'' permits. 
(8) The PROGRAM submittal contained a letter to Douglas M. Skie dated 
February 28, 1994 certifying the State's authority to implement section 
112 of the Act. The letter discusses the State's authority to require 
permit applications from sources subject to section 112(j) of the Act, 
but does not address the State's ability to make case-by-case MACT 
determinations. Prior to full PROGRAM approval, the State must certify 
its ability to make case-by-case MACT determinations pursuant to 
section 112(j) of the Act. (9) The State's February 28, 1994 letter to 
EPA also discusses the State's authority to implement section 112(r) of 
the Act, but does not address the State's ability to require annual 
certifications from part 70 sources as to whether their risk management 
plans (RMPs) are being properly implemented, or provide a compliance 
schedule for sources that fail to submit the required RMP. Prior to 
full PROGRAM approval, the State must certify its ability to require 
annual certifications from part 70 sources regarding proper 
implementation of their RMPs and to provide a compliance schedule for 
sources that fail to submit the required RMP. (10) Section 
16.8.2008(2)(a) allows the State to terminate, or revoke and reissue, 
permits for continuing and substantial violations. This language may be 
too limiting and may not provide full authority needed to be consistent 
with section 502(b)(5)(D) of the Act, which requires that state permit 
programs have authority to ``terminate, modify, revoke and reissue 
permits for cause.'' The [[Page 25145]] State addressed this issue in 
its March 30, 1995 letter; however, EPA was unable to determine whether 
Montana's PROGRAM is consistent in all respects with section 
502(b)(5)(D) of the Act. Prior to full PROGRAM approval, the State must 
either (a) clarify that it has authority to terminate or revoke and 
reissue permits in all circumstances in which cause to do so exists or 
(b) amend section 16.8.2008(2)(a) to eliminate any provisions that may 
be construed to limit ``cause'' in an unacceptable manner.
    Refer to the technical support document accompanying this 
rulemaking for a detailed explanation of these PROGRAM deficiencies and 
the required corrective actions.
    The scope of Montana's final interim PROGRAM approval does not 
extend to ``Indian Country,'' as defined in 18 U.S.C. 1151, including 
the following ``existing or former'' Indian reservations in the State: 
Northern Cheyenne, Rocky Boys, Blackfeet, Crow, Flathead, Fort Belknap, 
and Fort Peck Indian Reservations. Before EPA would approve the State's 
PROGRAM for any portion of ``Indian Country,'' EPA would have to be 
satisfied that the State has authority, either pursuant to explicit 
Congressional authorization or applicable principles of Federal Indian 
law, to enforce its laws against existing and potential pollution 
sources within any geographical area for which it seeks program 
approval and that such approval would constitute sound administrative 
practice. This is a complex and controversial issue, and EPA does not 
wish to delay interim approval of the State's PROGRAM with respect to 
undisputed sources while EPA resolves this question.
    In deferring final action on PROGRAM approval for sources located 
in ``Indian Country,'' EPA is not making a determination that the State 
either has adequate jurisdiction or lacks such jurisdiction. Instead, 
EPA is deferring judgment regarding this issue pending EPA's evaluation 
of the State's analysis.
    This interim PROGRAM approval, which may not be renewed, extends 
until June 11, 1997. During this interim approval period, the State of 
Montana is protected from sanctions, and EPA is not obligated to 
promulgate, administer and enforce a Federal operating permits program 
in the state of Montana. Permits issued under a program with interim 
approval have full standing with respect to part 70, and the one year 
time period for submittal of permit applications by subject sources 
begins upon the effective date of this interim approval, as does the 
three year time period for processing the initial permit applications.
    If the State of Montana fails to submit a complete corrective 
PROGRAM for full approval by December 11, 1996, EPA will start an 18-
month clock for mandatory sanctions. If the State of Montana then fails 
to submit a corrective PROGRAM that EPA finds complete before the 
expiration of that 18-month period, EPA will be required to apply one 
of the sanctions in section 179(b) of the Act, which will remain in 
effect until EPA determines that the State of Montana has corrected the 
deficiency by submitting a complete corrective PROGRAM. Moreover, if 
the Administrator finds a lack of good faith on the part of the State 
of Montana, both sanctions under section 179(b) will apply after the 
expiration of the 18-month period until the Administrator determines 
that the State of Montana has come into compliance. In any case, if, 
six months after application of the first sanction, the State of 
Montana still has not submitted a corrective PROGRAM that EPA has found 
complete, a second sanction will be required.
    If EPA disapproves the State of Montana's complete corrective 
PROGRAM, EPA will be required to apply one of the section 179(b) 
sanctions on the date 18 months after the effective date of the 
disapproval, unless prior to that date the State of Montana has 
submitted a revised PROGRAM and EPA has determined that it corrected 
the deficiencies that prompted the disapproval. Moreover, if the 
Administrator finds a lack of good faith on the part of the State of 
Montana, both sanctions under section 179(b) shall apply after the 
expiration of the 18-month period until the Administrator determines 
that the State of Montana has come into compliance. In all cases, if, 
six months after EPA applies the first sanction, the State of Montana 
has not submitted a revised PROGRAM that EPA has determined corrects 
the deficiencies, a second sanction is required.
    In addition, discretionary sanctions may be applied where warranted 
any time after the expiration of an interim approval period if the 
State of Montana has not timely submitted a complete corrective PROGRAM 
or EPA has disapproved its submitted corrective PROGRAM. Moreover, if 
EPA has not granted full approval to the Montana PROGRAM by the 
expiration of this interim approval and that expiration occurs after 
November 15, 1995, EPA must promulgate, administer and enforce a 
Federal permits program for the State of Montana upon interim approval 
expiration.
    Requirements for approval, specified in 40 CFR 70.4(b), encompass 
section 112(l)(5) requirements for approval of a program for delegation 
of section 112 standards as promulgated by EPA as they apply to part 70 
sources. Section 112(l)(5) requires that the State's program contain 
adequate authorities, adequate resources for implementation, and an 
expeditious compliance schedule, which are also requirements under part 
70. Therefore, the EPA is promulgating approval under section 112(l)(5) 
and 40 CFR 63.91 of the State's PROGRAM for receiving delegation of 
section 112 standards that are unchanged from Federal standards as 
promulgated. This program for delegations applies to sources covered by 
the part 70 program, as well as non-part 70 sources.
    EPA is also finalizing its approval of Montana's preconstruction 
permit program found in Sub-Chapter 11, sections 16.8.1101 through 
16.8.1120, of the State's regulations under the authority of title V 
and part 70 solely for the purpose of providing a mechanism to 
implement section 112(g) during any transition period between EPA's 
promulgation of a section 112(g) rule and adoption by the State of 
rules to implement section 112(g). However, since this approval is for 
the single purpose of providing a mechanism to implement section 112(g) 
during any transition period, the approval itself will be without 
effect if EPA decides in the final section 112(g) rule that sources are 
not subject to the requirements of the rule until State regulations are 
adopted. The EPA is limiting the duration of this approval to 12 months 
following promulgation by EPA of the final section 112(g) rule.

III. Administrative Requirements

A. Docket

    Copies of the State's submittal and other information relied upon 
for the final interim approval, including public comments received and 
reviewed by EPA on the proposal, are maintained in a docket at the EPA 
Regional Office. The docket is an organized and complete file of all 
the information submitted to, or otherwise considered by, EPA in the 
development of this final interim approval. The docket is available for 
public inspection at the location listed under the ADDRESSES section of 
this document. [[Page 25146]] 

B. Executive Order 12866

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

C. Regulatory Flexibility Act

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

List of Subjects in 40 CFR Part 70

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


    Dated: May 2, 1995.

Jack McGraw,

Acting Regional Administrator.


    Part 70, chapter I, title 40 of the Code of Federal Regulations is 
amended as follows:

PART 70--[AMENDED]

    1. The authority citation for part 70 continues to read as follows:

    Authority: 42 U.S.C. 7401, et seq.

    2. Appendix A to part 70 is amended by adding the entry for Montana 
in alphabetical order to read as follows:

Appendix A to Part 70--Approval Status of State and Local Operating 
Permits Programs

* * * * *

Montana

    (a) Montana Department of Health and Environmental Sciences--Air 
Quality Division: submitted on March 29, 1994; effective on June 12, 
1995; interim approval expires June 11, 1997.

    (b) [Reserved]


[FR Doc. 95-11677 Filed 5-10-95; 8:45 am]

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