[Federal Register Volume 60, Number 55 (Wednesday, March 22, 1995)]
[Rules and Regulations]
[Pages 15066-15069]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-7064]



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ENVIRONMENTAL PROTECTION AGENCY
40 CFR Part 70

[SD-001; FRL-5176-7]


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

AGENCY: Environmental Protection Agency (EPA).

ACTION: Final interim approval.

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SUMMARY: The EPA is promulgating interim approval of the Operating 
Permits Program submitted by the State of South Dakota for the purpose 
of [[Page 15067]] 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: April 21, 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 January 12, 1995 EPA published a Federal Register notice 
proposing interim approval of the Operating Permits Program for the 
State of South Dakota (PROGRAM). See 60 FR 2917. The EPA received 
adverse comments on this proposed interim approval, which are 
summarized and addressed below. In this rulemaking EPA is taking final 
action to promulgate interim approval of the South Dakota PROGRAM.

II. Final Action and Implications

A. Analysis of State Submission

    Robert E. Roberts, Secretary of the Department of Environment and 
Natural Resources, as designee of the Governor of South Dakota, 
submitted the State of South Dakota Title V Operating Permit Program 
(PROGRAM) to EPA on November 12, 1993. Amendments to the PROGRAM 
requested by EPA were received on January 11, 1994 and December 15, 
1994. The South Dakota PROGRAM, including the operating permit 
regulations (Administrative Rules of South Dakota (ARSD), Article 
74:36, Air Pollution Control Program), substantially meets the 
requirements of 40 CFR 70.2 and 70.3 with respect to applicability; 40 
CFR 70.4, 70.5, and 70.6 with respect to permit content including 
operational flexibility; 40 CFR 70.5 with respect to complete 
application forms and criteria which define insignificant activities; 
40 CFR 70.7 with respect to public participation and minor permit 
modifications; and 40 CFR 70.11 with respect to requirements for 
enforcement authority.
    Comments noting deficiencies in the South Dakota PROGRAM were sent 
to the State in a letter dated July 8, 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. In a letter dated August 18, 1994, the State 
committed to complete the regulatory process to correct both interim 
and full PROGRAM approval deficiencies related to its PROGRAM 
regulations, and submit these changes to EPA by approximately December 
15, 1994. EPA responded in a letter dated October 3, 1994 that they 
would review all of the State's corrective actions. However, these 
corrective actions would be considered a material change to the PROGRAM 
and the date for final interim approval would be extended. The State 
adopted the regulatory changes on November 17, 1994, which EPA has 
reviewed and has determined to be adequate to allow for interim 
approval. One remaining issue noted in EPA's July 8, 1994 letter that 
requires corrective action prior to full PROGRAM approval is discussed 
below in section C Final Action.

B. Response to Comments

    The comments received on the January 12, 1995 Federal Register 
notice proposing interim approval of the South Dakota PROGRAM, and 
EPA's response to those comments, are as follows:
    Comment #1: Two commenters objected to EPA's proposed approval of 
South Dakota's preconstruction permitting program for purpose of 
implementing section 112(g) of the Act during the transition period 
between PROGRAM approval and adoption of a State rule implementing 
EPA's section 112(g) regulations. The commenters argued that there is 
no legal basis for delegating to South Dakota the section 112(g) 
program until EPA has promulgated a section 112(g) regulation and the 
State has a section 112(g) program in place. In addition, the 
commenters argued that the South Dakota PROGRAM fails to address 
critical threshold questions of when an emission increase is greater 
than de minimis and when, if it is, it has been offset satisfactorily.
    EPA Response: In its proposed approval of South Dakota's PROGRAM, 
EPA also proposed to approve South Dakota's preconstruction permitting 
program for the purpose of implementing section 112(g) of the Act 
during the transition period before a Federal rule had been promulgated 
implementing section 112(g). This proposal was based in part on an 
interpretation of the Act that would require sources to comply with 
section 112(g) beginning on the date of approval of the title V 
program, regardless of whether EPA had completed its section 112(g) 
rulemaking. The EPA has since revised this interpretation of the Act. 
See 60 FR 8333 (dated February 14, 1995). This revised interpretation 
postpones the effective date of section 112(g) until after EPA has 
promulgated a rule addressing that provision. Questions regarding the 
threshold for determining when an emission increase is greater than de 
minimis and when it has been offset satisfactorily will be addressed in 
the final section 112(g) rule. The 112(g) interpretive notice explains 
that EPA is still considering whether the effective date of section 
112(g) should be delayed beyond the date of promulgation of the Federal 
rule so as to allow States time to adopt rules implementing the Federal 
rule, and that EPA will provide for any such additional delay in the 
final section 112(g) rulemaking. Unless and until EPA provides for such 
an additional postponement of section 112(g), South Dakota must be able 
to implement section 112(g) during the period between promulgation of 
the Federal section 112(g) rule and adoption of implementing State 
regulations. EPA believes that South Dakota can utilize its 
preconstruction review program to serve as a procedural vehicle for 
implementing section 112(g) and making these requirements Federally 
enforceable between promulgation of the Federal section 112(g) rule and 
adoption of implementing State regulations. The EPA approval of South 
Dakota's preconstruction review program clarifies that it may be used 
for this purpose during any transition period to meet the requirements 
of [[Page 15068]] section 112(g). South Dakota's preconstruction 
permitting program allows permit requirements to be established for all 
regulated air pollutants (which is defined at ASRD 70:36:01:15 and 
includes all of the hazardous air pollutants (HAPs) listed in section 
112(b) of the Act).
    Comment #2: Two commenters stated that they did not have a problem 
with the way ``prompt'' is defined for deviation reporting in the South 
Dakota PROGRAM but added that they did have a problem with the way the 
definition has been handled in other interim approval notices.
    EPA Response: The South Dakota PROGRAM allows the State to define 
``prompt'' for deviation reporting in each individual permit. Since the 
commenters did not have a problem with the way ``prompt'' reporting of 
deviations is handled in South Dakota, EPA will not respond to that 
comment. In addition, it would be inappropriate in this notice to 
comment on how the definition of ``prompt'' was handled in notices for 
other states' part 70 approvals.

C. Final Action

    The EPA is promulgating interim approval of the Operating Permits 
Program submitted by the State of South Dakota on November 12, 1993. 
The State must complete the following corrective action to receive full 
PROGRAM approval: 1) The State must adopt legislation consistent with 
40 CFR 70.11 prior to receiving full PROGRAM approval to allow for a 
maximum criminal fine of not less than $10,000 per day per violation 
for knowing violations of operating permit requirements, including 
making a false statement and tampering with a monitoring device.
    Refer to the technical support document accompanying this 
rulemaking for a detailed explanation of this PROGRAM deficiency and 
the required corrective action.
    The scope of South Dakota'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: 
1. Cheyenne River; 2. Crow Creek; 3. Flandreau; 4. Lower Brule; 5. Pine 
Ridge; 6. Rosebud; 7. Sisseton; 8. Standing Rock; and 9. Yankton.
    The State has asserted it has jurisdiction to enforce a part 70 
program within some or all of these ``existing or former'' Indian 
reservations and has provided an analysis of such jurisdiction. EPA is 
in the process of evaluating the State's analysis and will issue a 
supplemental notice regarding this issue in the future. 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 April 22, 1997. During this interim approval period, the State of 
South Dakota is protected from sanctions, and EPA is not obligated to 
promulgate, administer and enforce a Federal operating permits program 
in the State of South Dakota. 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 South Dakota fails to submit a complete corrective 
PROGRAM for full approval by October 22, 1996, EPA will start an 18-
month clock for mandatory sanctions. If the State of South Dakota 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 South Dakota 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 South Dakota, both sanctions under section 179(b) will 
apply after the expiration of the 18-month period until the 
Administrator determines that the State of South Dakota has come into 
compliance. In any case, if, six months after application of the first 
sanction, the State of South Dakota still has not submitted a 
corrective PROGRAM that EPA has found complete, a second sanction will 
be required.
    If EPA disapproves the State of South Dakota'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 South Dakota 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 
South Dakota, both sanctions under section 179(b) shall apply after the 
expiration of the 18-month period until the Administrator determines 
that the State of South Dakota has come into compliance. In all cases, 
if, six months after EPA applies the first sanction, the State of South 
Dakota 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 South Dakota 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 South Dakota 
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 South Dakota 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 only applies to sources 
covered by the part 70 program.
    EPA is also finalizing its approval of South Dakota's combined 
preconstruction/operating permit program found in section 74:36:05 of 
the State's regulations under the authority [[Page 15069]] 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.

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: March 14, 1995.
William P. Yellowtail,
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 South 
Dakota in alphabetical order to read as follows:

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

* * * * *

South Dakota

    (a) South Dakota Department of Environment and Natural Resources 
Division of Environmental Regulation: submitted on November 12, 
1993; effective on April 21, 1995; interim approval expires April 
22, 1997.
    (b) Reserved.

[FR Doc. 95-7064 Filed 3-21-95; 8:45 am]
BILLING CODE 6560-50-P