Document ID: EPA-HQ-OAR-2005-0036-1162
Agency: epa
Document Type: Supporting & Related Material
Title: 
Posted Date: 2007-02-26T05:00Z

SUPPORTING STATEMENT FOR STANDARD FORM 83-I

	PART A OF THE SUPPORTING STATEMENT

1.  IDENTIFICATION OF THE INFORMATION COLLECTION

1(a) TITLE AND NUMBER OF THE INFORMATION COLLECTION

Regulation of Fuel and Fuel Additives: Gasoline Benzene Program. 
Current OMB control number is 2060-0277.  The EPA number for this
proposed ICR is 1591.22.  The docket number is EPA-HQ-OAR-2005-0036.

(b) SHORT CHARACTERIZATION/ABSTRACT

Section 211(k) of the Clean Air Act (“Act”) requires that
reformulated gasoline (RFG) be sold in the nine worst ozone
nonattainment areas, as well as in other ozone nonattainment areas that
“opt in” to the RFG program.  The Act also requires EPA to regulate
the production and sale of conventional gasoline (non-RFG) throughout
the rest of the country.  Refiners and importers of gasoline are
required to demonstrate compliance by conducting sampling and testing of
the gasoline and reporting the results to EPA’s Office of
Transportation and Air Quality.  See 40 CFR Part 80, subparts D through
F.  Previous ICRs in this 1591 series have covered start up costs and
other record keeping, reporting, and testing requirements associated
with the final rule.  This proposed ICR covers burdens and costs
associated with the gasoline benzene program, which includes an
averaging, banking and trading credit program.  The program will not be
fully implemented until 2011, but there are several information
collection items related to registration, establishment of benzene
baselines and early credit generation, and pre-compliance reporting that
will apply from 2007-2009, and these are the subject of this proposed
ICR.  For convenience, we have included rough estimates for future
reporting beyond that timeframe as well.  Future reporting will be the
subject of a future proposed ICR.

2.  NEED FOR AND USE OF THE COLLECTION

(a) NEED/AUTHORITY FOR THE COLLECTION

The basic need and authority for the collection of information have
been established in the ICR for the RFG and anti-dumping final rule. 
The Act specifically provides that recordkeeping and reporting
requirements are among the tools EPA may use in enforcement of the
provisions of § 211(k) and also provides that EPA must develop an
enforceable scheme.  Sections 114 and 208 of the Act authorize EPA to
require recordkeeping and reporting regarding enforcement of the
provisions of Title II of the Act.  



(b) PRACTICAL UTILITY/USERS OF THE DATA

The practical utility and use of the collection of information related
to the RFG and conventional gasoline have been established in the ICR
for the RFG and anti-dumping  final rule.

The EPA’s Office of Enforcement and Compliance Assurance and EPA’s
Office of Air and Radiation, Office of Transportation and Air Quality,
will be the governmental users of the information contained in this
proposed information collection.    

3.	NONDUPLICATION, CONSULTATIONS, AND OTHER COLLECTION CRITERIA

(a) NONDUPLICATION 

This proposed ICR is not unnecessarily duplicative of information
otherwise reasonably accessible to the Agency.  Wherever possible, we
have designed the regulation to make sure that there is no unnecessary
duplication.  For example, parties who have already registered under the
RFG and anti-dumping program do not have to re-register and
recordkeeping and reporting related to sampling and testing activities
are based upon existing provisions that adequately meet program needs.	

(b) PUBLIC NOTICE REQUIRED PRIOR TO ICR SUBMISSION TO OMB

The proposed ICR changes are included in the rule.  A draft supporting
statement was placed in the public docket cited above, in connection
with the notice of proposed rulemaking.  This supporting statement
revises the one prepared for the notice of proposed rulemaking.  

(c) CONSULTATIONS

We consulted the American Petroleum Institute for assistance with the
estimates in this proposed ICR.  In addition, industry was consulted in
making the assumptions related to the original information collection
burden and in developing the rule that this proposed ICR is based on. We
are seeking industry comment via this draft supporting statement and
encourage all interest parties to submit comments to us.

  

(d) EFFECTS OF LESS FREQUENT COLLECTION

Less frequent reporting would make discovery and correction of
violations take too long to discover from the date of violation, and
would give non-complying parties a competitive advantage for long
periods of time.  A lesser recordkeeping burden would make verification
of compliance extremely difficult.

(e) GENERAL GUIDELINES

The general guidelines for the collection of information pursuant to the
RFG and anti-dumping rule are approved in the ICR for the final RFG and
anti-dumping rule.

(f) CONFIDENTIALITY AND SENSITIVE QUESTIONS

 (i) Confidentiality

Any information submitted to EPA for which a claim of confidentiality is
made will be safeguarded according to EPA regulations at 40 C.F.R. 2.201
et. seq.   

(ii) Sensitive Questions

This section is not applicable as this proposed ICR does not involve
matters of a sensitive nature.

4.	THE RESPONDENTS AND THE INFORMATION REQUESTED

(a) RESPONDENTS/NAICS and SIC CODES

Respondents are gasoline refiners and importers (324110 / 2911) of RFG
and conventional gasoline.  

(b) INFORMATION REQUESTED

(i) Data Items, Including Recordkeeping Requirements

Knowledge of the following definitions at 40 CFR 80.2 is important for a
thorough understanding of the reporting and recordkeeping requirements:

“Gasoline” means any fuel sold in any State (State means a State,
the District of Columbia, the Commonwealth of Puerto Rico, the Virgin
Islands, Guam,  American Samoa, and the Northern Mariana Islands) for
use in motor vehicles and motor vehicle engines, and commonly or
commercially known or sold as gasoline.

“Refiner” means any person who owns, leases, operates, controls, or
supervises a refinery.

“Importer” means a person who imports gasoline, gasoline blending
stocks or components, or diesel fuel from a foreign country into the
United States (including the Commonwealth of Puerto Rico, the Virgin
Islands, Guam, American Samoa, and the Northern Mariana Islands).

“Reformulated Gasoline” means any gasoline whose formulation has
been certified under 40 CFR 80.40 and which meets each of the standards
and requirements prescribed under 40 CFR 80.41.

“Conventional Gasoline” means any gasoline which has not been
certified under 40 CFR 80.40.

REPORTING REQUIREMENTS

	The following reporting requirements may be applicable to a party
between January 1, 2007 and December 31, 2009:

Company Registration - Registration is required under this regulation
for refiners and importers and will use existing forms.  Refiners and
importers who have already registered with us will not be required to
register again. EPA issues a four-digit identification number for each
company.

Facility Registration - Refiners and importers must register all their
facilities.  Facilities already registered with us will not be required
to be registered again.  Application will be via existing EPA forms. 
EPA issues a five-digit identification number for each facility.  

Attest Engagement “Audit” Report - Refiners and importers who meet
compliance on average will have to expand the existing attest engagement
to include benzene content and credit generation.  An attest engagement
is performed by an independent auditor.  There is no EPA form, but the
attest engagement must follow requirements specified in the regulation
and which are based upon American Institute of Certified Public
Accountants (AICPA) standards.

Benzene Baseline Application – Those refiners intending to generate
early credits must establish a benzene baseline 60 days prior to the end
of the first period during which credits will be generated.  This is a
one time application.  There is no standard EPA form.

Early Compliance Application - Refiners and importers may submit this
application, which will typically take the form of a letter.  There is
no standard EPA form.  (This report was not included in the supporting
statement that accompanied the notice of proposed rulemaking due to an
accidental omission.)

Hardship Applications - Refiners may apply for temporary hardship
relief.  Small refiner status and accompanying regulatory relief for
small refiners.  Refiners or importers may apply for relief under
extraordinary circumstances.  These are one time applications. There is
no standard EPA form.

Notification Letter (Acquisitions) – If a refiner acquires a small
refiner that has received small refiner flexibility, notification must
be made by letter.  These are one time notifications.  There is no
standard EPA form.

Pre-Compliance Report - Refiners and importers will submit this report,
which will typically take the form of a letter.  There is no standard
EPA form.

Annual Report - Annual reports will be submitted by refiners and
importers using established EPA forms.  It will be necessary for EPA to
develop a new benzene credit report, but this form has not yet been
developed.

	During the initial three years of the program (the period covered by
this ICR), most  recordkeeping and reporting activities will be
performed only by parties who choose to generate early benzene credits. 
In future years, it will be necessary to develop product transfer
documents (PTDs) and pump labels for aircraft and certain racing fuels
that would be exempt under the benzene requirements.  Future reporting
items are roughly estimated in this ICR for informational purposes,
although they are not part of the burden calculations. 

(ii) 	Respondent Activities

The following are required:

Read and comprehend the regulations and instructions on completing the
forms.

Train personnel to meet the requirements, employing new technologies if
warranted.

Develop the information that is not already available.

Gather and organize the information.

Review the information, perform quality assurance, and take corrective
action, if necessary, to meet the regulatory requirements.

Report the information to EPA, on forms as appropriate, and/or retain
the information, as specified in the regulations.

5.  	THE INFORMATION COLLECTED--AGENCY ACTIVITIES, COLLECTION 
METHODOLOGY AND INFORMATION MANAGEMENT

(a) AGENCY ACTIVITIES

The following are required:

Develop a thorough understanding of the regulatory requirements. 
Prepare guidance documents and forms.  

Convey the requirements in a manner that is understandable.  Emphasize
the benefits of submitting data electronically.

Respond to inquiries.

Provide access to the regulations, guidance documents, and forms.

Review the submitted information prior to data entry for compliance with
submission requirements.

Contact the respondent when the information has not been submitted
properly and provide guidance on correction of the problem.

Maintain and refine hardware and software systems for handling
confidential data via hard copy and electronically.

Administer a contract for data entry.

Input information into databases and store the information.

Perform data analysis and identify violations.

 (b) COLLECTION METHODOLOGY AND MANAGEMENT

The information collection has been developed by EPA offices that have
planned and allocated resources for the efficient and effective
management and use of the information to be collected, including the
processing of the information in a manner which will enhance the utility
of the information for the Agency and the public.  The information
collection, to the maximum extent practicable, uses appropriate
information technology to reduce burden and improve data quality, Agency
efficiency, and responsiveness to the public.

EPA has supplied, or will supply, forms and electronic formats for many
reporting requirements.  (For some of the requirements, forms or formats
would be impractical.  The information may be submitted in a manner
chosen by the respondent.)  It is our goal to have nearly all forms
received electronically and in a simplified, flat file format by the
time this rule is implemented.  

The product transfer document information can be included on standard
transfer documentation customarily used.  EPA allows the information to
be encoded to facilitate reporting and save space.  Detailed production
documents are already used and maintained by refiners.

The information is carefully reviewed for compliance with the
requirements.  Most of the information submitted to the Agency under the
RFG and anti-dumping program is confidential.  It is stored in a secure
area and on secure databases.

No changes to the collection methodologies in the existing ICR for the
RFG and anti-dumping final rule are anticipated as a result of this
proposed ICR modification.

(c) SMALL BUSINESS FLEXIBILITY

The underlying rule attempts to provide small businesses maximum
flexibility in meeting the benzene content standard.  For example, small
refiners may apply for flexibility or delay in meeting regulatory
requirements.

(d) COLLECTION SCHEDULE

There is no change in collection schedules relative to the ICR for the
RFG and anti-dumping final rule as a result of this proposed ICR
modification.

6.	ESTIMATING THE BURDEN AND COST OF THE COLLECTION

 	(a) ESTIMATING THE RESPONDENT BURDEN

We drew upon experience implementing similar regulations among the same
entities to develop estimates of the burden associated with this
modification. 



(b) ESTIMATING THE RESPONDENT COST

Three labor categories are involved:  managerial (includes legal and
professional review), technical, and clerical. The estimates use Bureau
of Labor Statistics, "Employer Costs for Employee Compensation - Table
12 - Private Industry, Manufacturing, and Non-Manufacturing Industries
by Occupational Group (December 2003), with a 3% inflation factor
applied to bring the values to 2006.  Using this method, the following
wages and benefits apply by category:

Wages and Benefits

Managerial 	$53.87 per hour

Technical	$35.29 per hour

Clerical	$24.56 per hour

Doubling for company overhead beyond wages and benefits, and for
convenience, rounding up to the dollar, gives the following rates for
this ICR:

Total Employer Cost

Managerial	$108 per hour

Technical	$71 per hour

Clerical	$49 per hour

The labor mix for the activities estimated will be about the same for
each and is consistent with prior ICRs in this series.  It is assumed
that for each hour of activity the mix will be about 0.1 hour
managerial, 0.7 hour technical, and 0.2 hour clerical.  This gives an
average labor cost of $71 per hour, which will be used in this ICR
modification. For the purpose of estimating purchased services, the
average labor cost is doubled to $142 per hour.  Since most purchased
services are going to be CPA or independent auditor services, this
hourly rate represents a reasonable average estimate for outside
professional services.  (For the supporting statement provided with the
notice of proposed rulemaking, we used $71.  However, $142 is a more
accurate figure that we have used in similar, more recent supporting
statements.  Therefore, we have amended this supporting statement
accordingly.)

	(c) ESTIMATING AGENCY BURDEN AND COST

The annual Agency burden is determined using the 2006 OPM hourly pay
table, with values multiplied by 1.6, the standard government benefits
multiplier. The hourly wage rates are as follows, rounded up to the
nearest five dollars:  

EPA Manager = $80

Technical Staff (GS-13) = $60

Clerical Staff (GS-5) = $25

We have assumed that each response will require 3.5 hours of technical
staff time to review and prepare the written response.  It is estimated
that manager will be required to expend 0.25 hour per response and that
the clerical staff will expend 0.25 hour per response.  Contractors will
not be used to handle these applications and are not included.  The
total number of responses is calculated for benzene baseline
applications (70), temporary hardship applications (20), applications
for relief under extraordinary circumstances (2) and small refiner
applications (27), which yields a total of 119 Agency responses.

The total annual Agency burden hours are estimated as follows:

Activity	No. of

Responses	Manager

Hours	Technical

Hours	Clerical

Hours	Total Agency Hours

Evaluate Data	119	0	2.5	0	297.5

Prepare 

And Send

Response	119	0.25	1	0.0	148.75

Store Data	119	0	0	0.25	29.75

Total

0.25	3.5	0.25	476

The total cost per responses is estimated to be $6/clerical worker,
$210/technical staff, and $20/manager, which yields $236/response.  The
total cost burden to the Agency for 119 responses would be $28,084.

(d) ESTIMATING THE RESPONDENT UNIVERSE 

We were able to estimate the number of regulated entities drawing upon
our experience regulating the same entities.  We have assumed 125
refiners and 60 importers, total.  We have assumed 70 refiners would
generate early credits.  (This number is based upon an estimate of 68 in
the proposed Regulatory Impact Analysis, rounded up to 70.)  Importers
cannot generate early credits.  "Purchased services" on the following
table relates to refiners who may hire an outside consultant to prepare
their benzene application; this has been a common practice in industry
with respect to similar applications.

 



(e) BOTTOM LINE BURDEN HOURS AND COSTS

The annual estimates in burden hours and costs associated with this
final rule are as follows:

Annual Respondent Burden Hours & Costs

(Including Non-Postage "Other Costs")

Collection

Activity 	# Respondents

By Activity	# Responses per Respondent 	Total # of Responses 	# Hours
per Response	Total Hours and Total Costs 

@ $71/hour	Non-Postage Other Costs

(O&M)

Refiner and importer registration

(§ 80.1225)	10	1	10	1	10 hours

---

$710	0

Facility registration

(§ 80.1225)	10	2	20	1	20 hours

---

$1,420	0

Benzene baseline applications

(§ 80.1285)	70	1	70	200	14,000 hrs

---

$994,000	$1,998,000

Early compliance applications (§ 80.1334)	70	1	70	40	2,800 hours

---

$198,800	0

Temporary hardship applications

(§ 80.1335)	20	1	20	40	800 hours

---

$56,800	0



Application for relief under extreme circum-stances

(§ 80.1336)	2	1	2	40	80 hours

---

$5,680	0

Application for small refiner status

(§ 80.1340)	25	1	25	40	1,000 hours

---

$71,000	0

Application for delay of compliance date for small refiner hardship (§
80.1343)	2	1	2	40	80 hours

---

$5,680	0

Refiner acquisition of a small refiner – notification letter

(§ 80.1344)	2	1	2	1	2 hours

---

$142	0

Generate and retain calculations related to benzene content and credits

(§ 80.1350)	70	1	70	40	2,800 hours

---

$198,800	0

Pre-Compliance Reporting

(§ 80.1352)	125	1	125	40	5,000 hrs

---

$355,000	0

Attest engagement for early credit generation

(§ 80.1375)	70	1	70	2	All purchased services.	2 hours

---

$142

TOTALS

	26,592

hours

===

$1,888,032	$1,988,284

TOTALS:

TOTAL NO. OF REPORTS: 486  

TOTAL BURDEN HOURS:   26,592

TOTAL COSTS @ $71/hour:   $1,888,032

TOTAL NON-POSTAGE PURCHASED SERVICES ONLY @ $142/hour:  $1,988,284  

The following information is provided for informational purposes only,
as it relates to future recordkeeping and reporting activities
associated with this rule that would not be covered by the initial
three-year period of the proposed ICR.  These will be the subject of a
future ICR modification, but are provided here in order to aid
interested parties in understanding the rule.  Attest engagements are
required to be performed by an outside auditor and therefore are all
"purchased services."  Attest engagements are already performed under
the anti-dumping program, so the cost estimated is an additional charge
for adding the benzene item to the pre-existing attest engagement.  



Annual Respondent Burden Hours & Costs

(Including Non-Postage "Other Costs")

Applicable after December 31, 2009

---informational table only;   not included in burden estimates---

Collection

Activity 	# Respondents

By Activity	# Responses per Respondent 	Total # of Responses 	# Hours
per Response	Total Hours and Total Costs 

@ $71/hour	Non-Postage Other Costs

(O&M)

Refiner and importer registration

(§ 80.1225)	10	1	10	1	10 hours

---

$710	0

Facility registration

(§ 80.1225)	10	2	20	1	20 hours

---

$1,420	0

Application for relief under extreme circum-stances

(§80.1336)	2	1	2	40	80 hours

---

$5,680

	0



Generate and retain calculations related to benzene content and credits

(§ 80.1350)	185	1	185	40	7,400 

---

$525,400	0

Developing in-house format / procedure for annual reporting and report 

(year one)

(§§ 80.1295 and 80.1354)	185	1	185	100	18,500 hrs

---

$1,313,500	0

Pre-Compliance Reporting

(§80.1352)

For 2010	125	1	125	40	5,000 hours

---

$355,000	0

Annual reports

(after year one)

(§§ 80.1295 and 80.1354)	185	1	185	1	185 hours

---

$13,135	0



Attest engagement

(§ 80.1375)	185	1	185	2	All purchased services.

	$52,540

Implement code for PTDs for aircraft / racing	50	1	50	4	200 hours

---

$14,200	0

Develop pump labels for aircraft / racing	50	1	50	4	200 hours

---

$14,200	0

TOTALS	987	11	997	233	31,595 hrs

===

$2,243,245	$52,540

(f) REASON FOR CHANGE IN BURDEN

	The proposed change in burden is due to rulemaking affecting benzene
content of RFG and conventional gasoline.  

(g) BURDEN STATEMENT

 The average Agency burden in hours per response for this ICR is
estimated to be four (4) hours.  The average respondent burden in hours
per response for this ICR is estimated to be 55 hours.

 Burden means the total time, effort, or financial resources expended by
persons to generate, maintain, retain, or disclose or provide
information to or for a Federal agency.  This includes the time needed
to review instructions; develop, acquire, install, and utilize
technology and systems for the purposes of collecting, validating, and
verifying information, processing and maintaining information, and
disclosing and providing information; adjust the existing ways to comply
with any previously applicable instructions and requirements; train
personnel to be able to respond to a collection of information; search
data sources; complete and review the collection of information; and
transmit or otherwise disclose the information.  An agency may not
conduct or sponsor, and a person is not required to respond to, a
collection of information unless it displays a currently valid OMB
control number.  The OMB control numbers for EPA's regulations are
listed in 40 CFR part 9 and 48 CFR chapter 15.     

To comment on the Agency's need for this information, the accuracy of
the provided burden estimates, and any suggested methods for minimizing
respondent burden, including the use of automated collection techniques,
EPA has established a public docket for the rulemaking and for this ICR.
 Comments may be submitted to the attention of the following docket
number: EPA-HQ-OAR-2005-0036.   You can also send comments to the Office
of Information and Regulatory Affairs, Office of Management and Budget,
725 17th Street, NW, Washington, DC 20503, Attention: Desk Office for
EPA.  Please include the docket number in any correspondence. 

B.	COLLECTION OF INFORMATION EMPLOYING STATISTICAL METHODS

This section is not applicable because statistical methods are not used
in the data collection associated with the reformulated and anti-dumping
regulations. 

 Please note that costs are not expressed in thousands of dollars as is
the usual custom for supporting statements, but in actual dollars. 
Because some amounts are relatively small, it is easier in this case to
use actual dollars. 

 This is the total number of hours from the "Annual Respondent Burden
Hours & Costs" table on pages 10-12 , divided by the total number of
reports, rounded up for simplicity.

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