Document ID: EPA-HQ-OAR-2014-0060-0020
Agency: epa
Document Type: Notice
Title: Decisions: California State Nonroad Engine Pollution Control Standards; Mobile Cargo Handling Equipment at Ports and Intermodal Rail Yards Regulations
Posted Date: 2015-05-07T04:00Z

[Federal Register Volume 80, Number 88 (Thursday, May 7, 2015)]
[Notices]
[Pages 26249-26254]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2015-11034]

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ENVIRONMENTAL PROTECTION AGENCY

[EPA-HQ-OAR-2014-0060; FRL-9927-30-OAR]

California State Nonroad Engine Pollution Control Standards; 
Mobile Cargo Handling Equipment at Ports and Intermodal Rail Yards 
Regulations; Notice of Decision

AGENCY: Environmental Protection Agency (EPA).

ACTION: Notice of decision.

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SUMMARY: The Environmental Protection Agency (``EPA'') is granting the 
California Air Resources Board's (``CARB'') request for authorization 
of amendments to its mobile cargo handling equipment at ports and 
intermodal rail yards regulations (``CHE amendments''). EPA is also 
confirming that certain CHE amendments are within the scope of prior 
EPA authorizations. CARB's mobile cargo handling equipment at ports and 
intermodal rail yard regulations apply to all newly purchased, leased 
or rented on- and off-road vehicles and equipment, as well as in-use 
on- and off-road vehicles and equipment, with compression-ignition 
engines that operate at ports and intermodal rail yards. This decision 
is issued under the authority of the Clean Air Act (``CAA'' or 
``Act'').

DATES: Petitions for review must be filed by July 6, 2015.

ADDRESSES: EPA has established a docket for this action under Docket ID 
EPA-HQ-OAR-2014-0060. All documents relied upon in making this 
decision, including those submitted to EPA by CARB, are contained in 
the public docket. Publicly available docket materials are available 
either electronically through www.regulations.gov or in hard copy at 
the Air and Radiation Docket in the EPA Headquarters Library, EPA West 
Building, Room 3334, located at 1301 Constitution Avenue NW., 
Washington, DC. The Public Reading Room is open to the public on all 
federal government working days from 8:30 a.m. to 4:30 p.m.; generally, 
it is open Monday through Friday, excluding holidays. The telephone 
number for the Reading Room is (202) 566-1744. The Air and Radiation 
Docket and Information Center's Web site is http://www.epa.gov/oar/docket.html. The electronic mail (email) address for the Air and 
Radiation Docket is: a-and-r-Docket@epa.gov, the telephone number is 
(202) 566-1742, and the fax number is (202) 566-9744. An electronic 
version of the public docket is available through the federal 
government's electronic public docket and comment system. You may 
access EPA dockets at http://www.regulations.gov. After opening the 
www.regulations.gov Web site, enter EPA-HQ-OAR-2014-0060 in the ``Enter 
Keyword or ID'' fill-in box to view documents in the record. Although a 
part of the official docket, the public docket does not include 
Confidential Business Information (``CBI'') or other information whose 
disclosure is restricted by statute.
    EPA's Office of Transportation and Air Quality (``OTAQ'') maintains 
a Web page that contains general information on its review of 
California waiver and authorization requests. Included on that page are 
links to prior waiver Federal Register notices, some of which are cited 
in today's notice; the page can be accessed at http://www.epa.gov/otaq/cafr.htm.

FOR FURTHER INFORMATION CONTACT: David Dickinson, Attorney-Advisor, 
Compliance Division, Office of Transportation and Air Quality, U.S. 
Environmental Protection Agency, 1200 Pennsylvania Ave. NW., 
Washington, DC 20460. Telephone: (202) 343-9256. Fax: (202) 343-2804. 
Email: dickinson.david@epa.gov.

SUPPLEMENTARY INFORMATION:

I. Background

    CARB first adopted its CHE regulation on December 31, 2006. The 
regulation applied to newly purchased, leased, or rented on- and off-
road vehicles and equipment, as well as to in-use on- and off-road 
vehicles and equipment with compression-ignition (CI) engines that 
operate at ports and intermodal rail yards.\1\ On February 21, 2012, 
EPA granted California a full waiver for those parts of the CHE 
regulation establishing emission standards for new on-road motor 
vehicles and full authorization for standards and other requirements 
related to the control of emissions affecting new and in-use nonroad 
engines.\2\ CARB formally adopted the CHE amendments on October 14, 
2012,\3\ and they are codified at title 13, California Code of 
Regulations (CCR), section 2479. The CHE amendments modify certain 
retrofit, operational, and compliance requirements; strengthen certain 
emission standards; and address definitions and provide other 
clarifying language. By letter dated May 16, 2013, CARB submitted a 
request to EPA pursuant to section 209(e) of the Act, seeking EPA's 
confirmation that certain CHE amendments fall within the scope of EPA's 
February 2012 authorization

[[Page 26250]]

and a full authorization for other CHE amendments. Those CHE amendments 
for which CARB sought within-the-scope confirmation are related to 
compliance flexibility and reduced compliance costs and include: 
Modification to retrofit requirements and operational practices; 
demonstration of emissions equivalency for alternative technology; and 
modification of certain compliance requirements. CARB sought a full 
authorization for the CHE amendments related to new, more stringent 
requirements and include: A new opacity based monitoring program for 
in-use nonroad vehicles and equipment; and, a new retrofit requirement 
for engines meeting the Tier 4 Family Emissions Limit standards.
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    \1\ The federal term ``nonroad'' and the California term ``off-
road'' are used interchangeably.
    \2\ 77 FR 9916 (February 21, 2012).
    \3\ CARB ``Resolution 11-30,'' September 22, 2011; CARB 
``Executive Order R-12-009,'' August 2, 2012.
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A. Clean Air Act Nonroad Engine and Vehicle Authorizations

    Section 209(e)(1) of the Act permanently preempts any state, or 
political subdivision thereof, from adopting or attempting to enforce 
any standard or other requirement relating to the control of emissions 
for certain new nonroad engines or vehicles.\4\ For all other nonroad 
engines (including ``non-new'' engines), states generally are preempted 
from adopting and enforcing standards and other requirements relating 
to the control of emissions, except that section 209(e)(2)(A) of the 
Act requires EPA, after notice and opportunity for public hearing, to 
authorize California to adopt and enforce such regulations unless EPA 
makes one of three enumerated findings. Specifically, EPA must deny 
authorization if the Administrator finds that (1) California's 
protectiveness determination (i.e., that California standards will be, 
in the aggregate, as protective of public health and welfare as 
applicable federal standards) is arbitrary and capricious, (2) 
California does not need such standards to meet compelling and 
extraordinary conditions, or (3) the California standards and 
accompanying enforcement procedures are not consistent with section 209 
of the Act.
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    \4\ States are expressly preempted from adopting or attempting 
to enforce any standard or other requirement relating to the control 
of emissions from new nonroad engines which are used in construction 
equipment or vehicles or used in farm equipment or vehicles and 
which are smaller than 175 horsepower. Such express preemption under 
section 209(e)(1) of the Act also applies to new locomotives or new 
engines used in locomotives.
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    On July 20, 1994, EPA promulgated a rule interpreting the three 
criteria set forth in section 209(e)(2)(A) that EPA must consider 
before granting any California authorization request for nonroad engine 
or vehicle emission standards.\5\ EPA revised these regulations in 
1997.\6\ As stated in the preamble to the 1994 rule, EPA historically 
has interpreted the consistency inquiry under the third criterion, 
outlined above and set forth in section 209(e)(2)(A)(iii), to require, 
at minimum, that California standards and enforcement procedures be 
consistent with section 209(a), section 209(e)(1), and section 
209(b)(1)(C) of the Act.\7\
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    \5\ See ``Air Pollution Control; Preemption of State Regulation 
for Nonroad Engine and Vehicle Standards,'' 59 FR 36969 (July 20, 
1994).
    \6\ See ``Control of Air Pollution: Emission Standards for New 
Nonroad Compression-Ignition Engines at or Above 37 Kilowatts; 
Preemption of State Regulation for Nonroad Engine and Vehicle 
Standards; Amendments to Rules,'' 62 FR 67733 (December 30, 1997). 
The applicable regulations are now found in 40 CFR part 1074, 
subpart B, section 1074.105.
    \7\ See supra note 12. EPA has interpreted 209(b)(1)(C) in the 
context of section 209(b) motor vehicle waivers.
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    In order to be consistent with section 209(a), California's nonroad 
standards and enforcement procedures must not apply to new motor 
vehicles or new motor vehicle engines. To be consistent with section 
209(e)(1), California's nonroad standards and enforcement procedures 
must not attempt to regulate engine categories that are permanently 
preempted from state regulation. To determine consistency with section 
209(b)(1)(C), EPA typically reviews nonroad authorization requests 
under the same ``consistency'' criteria that are applied to motor 
vehicle waiver requests under section 209(b)(1)(C). That provision 
provides that the Administrator shall not grant California a motor 
vehicle waiver if she finds that California ``standards and 
accompanying enforcement procedures are not consistent with section 
202(a)'' of the Act. Previous decisions granting waivers and 
authorizations have noted that state standards and enforcement 
procedures will be found to be inconsistent with section 202(a) if (1) 
there is inadequate lead time to permit the development of the 
necessary technology, giving appropriate consideration to the cost of 
compliance within that time, or (2) the federal and state testing 
procedures impose inconsistent certification requirements.
    In light of the similar language of sections 209(b) and 
209(e)(2)(A), EPA has reviewed California's requests for authorization 
of nonroad vehicle or engine standards under section 209(e)(2)(A) using 
the same principles that it has historically applied in reviewing 
requests for waivers of preemption for new motor vehicle or new motor 
vehicle engine standards under section 209(b).\8\ These principles 
include, among other things, that EPA should limit its inquiry to the 
three specific authorization criteria identified in section 
209(e)(2)(A),\9\ and that EPA should give substantial deference to the 
policy judgments California has made in adopting its regulations. In 
previous waiver decisions, EPA has stated that Congress intended EPA's 
review of California's decision-making be narrow. EPA has rejected 
arguments that are not specified in the statute as grounds for denying 
a waiver:
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    \8\ See Engine Manufacturers Association v. EPA, 88 F.3d 1075, 
1087 (D.C. Cir. 1996): ``. . . EPA was within the bounds of 
permissible construction in analogizing Sec.  209(e) on nonroad 
sources to Sec.  209(a) on motor vehicles.''
    \9\ See supra note 12, at 36983.

    The law makes it clear that the waiver requests cannot be denied 
unless the specific findings designated in the statute can properly 
be made. The issue of whether a proposed California requirement is 
likely to result in only marginal improvement in California air 
quality not commensurate with its costs or is otherwise an arguably 
unwise exercise of regulatory power is not legally pertinent to my 
decision under section 209, so long as the California requirement is 
consistent with section 202(a) and is more stringent than applicable 
Federal requirements in the sense that it may result in some further 
reduction in air pollution in California.\10\
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    \10\ ``Waiver of Application of Clean Air Act to California 
State Standards,'' 36 FR 17458 (Aug. 31, 1971). Note that the more 
stringent standard expressed here, in 1971, was superseded by the 
1977 amendments to section 209, which established that California 
must determine that its standards are, in the aggregate, at least as 
protective of public health and welfare as applicable Federal 
standards. In the 1990 amendments to section 209, Congress 
established section 209(e) and similar language in section 
209(e)(1)(i) pertaining to California's nonroad emission standards 
which California must determine to be, in the aggregate, at least as 
protective of public health and welfare as applicable federal 
standards.

This principle of narrow EPA review has been upheld by the U.S. Court 
of Appeals for the District of Columbia Circuit.\11\ Thus, EPA's 
consideration of all the evidence submitted concerning an authorization 
decision is circumscribed by its relevance to those questions that may 
be considered under section 209(e)(2)(A).
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    \11\ See, e.g., Motor and Equip. Mfrs Assoc. v. EPA, 627 F.2d 
1095 (D.C. Cir. 1979) (``MEMA I'').
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    If California amends regulations that were previously authorized by 
EPA, California may ask EPA to determine that the amendments are within 
the scope of the earlier authorization. A within-the-scope 
determination for such amendments is permissible without a full 
authorization review if three conditions are met. First, the amended 
regulations must not undermine California's previous determination that

[[Page 26251]]

its standards, in the aggregate, are as protective of public health and 
welfare as applicable federal standards. Second, the amended 
regulations must not affect consistency with section 209 of the Act, 
following the same criteria discussed above in the context of full 
authorizations. Third, the amended regulations must not raise any ``new 
issues'' affecting EPA's prior authorizations.\12\
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    \12\ See ``California State Motor Vehicle Pollution Control 
Standards; Amendments Within the Scope of Previous Waiver of Federal 
Preemption,'' 46 FR 36742 (July 15, 1981).
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B. Deference to California

    In previous waiver decisions, EPA has recognized that the intent of 
Congress in creating a limited review based on the section 209(b)(1) 
criteria was to ensure that the federal government did not second-guess 
state policy choices. As the agency explained in one prior waiver 
decision:

    It is worth noting * * * I would feel constrained to approve a 
California approach to the problem which I might also feel unable to 
adopt at the federal level in my own capacity as a regulator. The 
whole approach of the Clean Air Act is to force the development of 
new types of emission control technology where that is needed by 
compelling the industry to ``catch up'' to some degree with newly 
promulgated standards. Such an approach * * * may be attended with 
costs, in the shape of reduced product offering, or price or fuel 
economy penalties, and by risks that a wider number of vehicle 
classes may not be able to complete their development work in time. 
Since a balancing of these risks and costs against the potential 
benefits from reduced emissions is a central policy decision for any 
regulatory agency under the statutory scheme outlined above, I 
believe I am required to give very substantial deference to 
California's judgments on this score.\13\
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    \13\ 40 FR 23102, 23103-23104 (May 28, 1975).

    Similarly, EPA has stated that the text, structure, and history of 
the California waiver provision clearly indicate both a congressional 
intent and appropriate EPA practice of leaving the decision on 
``ambiguous and controversial matters of public policy'' to 
California's judgment.\14\ This interpretation is supported by relevant 
discussion in the House Committee Report for the 1977 amendments to the 
Clean Air Act.\15\ Congress had the opportunity through the 1977 
amendments to restrict the preexisting waiver provision, but elected 
instead to expand California's flexibility to adopt a complete program 
of motor vehicle emission controls. The report explains that the 
amendment is intended to ratify and strengthen the preexisting 
California waiver provision and to affirm the underlying intent of that 
provision, that is, to afford California the broadest possible 
discretion in selecting the best means to protect the health of its 
citizens and the public welfare.\16\
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    \14\ Id. at 23104; 58 FR 4166 (January 13, 1993).
    \15\ MEMA I, 627 F.2d at 1110 (citing H.R. Rep. No. 294, 95th 
Cong., 1st Sess. 301-302 (1977)).
    \16\ Id.
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C. Burden and Standard of Proof

    As the U.S. Court of Appeals for the D.C. Circuit has made clear in 
MEMA I, opponents of a waiver request by California bear the burden of 
showing that the statutory criteria for a denial of the request have 
been met:

    [T]he language of the statute and its legislative history 
indicate that California's regulations, and California's 
determinations that they must comply with the statute, when 
presented to the Administrator are presumed to satisfy the waiver 
requirements and that the burden of proving otherwise is on whoever 
attacks them. California must present its regulations and findings 
at the hearing and thereafter the parties opposing the waiver 
request bear the burden of persuading the Administrator that the 
waiver request should be denied.\17\

    \17\ MEMA I, supra note 19, at 1121.

The Administrator's burden, on the other hand, is to make a reasonable 
evaluation of the information in the record in coming to the waiver 
decision. As the court in MEMA I stated: ``here, too, if the 
Administrator ignores evidence demonstrating that the waiver should not 
be granted, or if he seeks to overcome that evidence with unsupported 
assumptions of his own, he runs the risk of having his waiver decision 
set aside as `arbitrary and capricious.' '' \18\ Therefore, the 
Administrator's burden is to act ``reasonably.'' \19\
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    \18\ Id. at 1126.
    \19\ Id. at 1126.
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    With regard to the standard of proof, the court in MEMA I explained 
that the Administrator's role in a section 209 proceeding is to:

    [. . .]consider all evidence that passes the threshold test of 
materiality and * * * thereafter assess such material evidence 
against a standard of proof to determine whether the parties 
favoring a denial of the waiver have shown that the factual 
circumstances exist in which Congress intended a denial of the 
waiver.\20\

    \20\ Id. at 1122.

In that decision, the court considered the standards of proof under 
section 209 for the two findings related to granting a waiver for an 
``accompanying enforcement procedure.'' Those findings involve: (1) 
Whether the enforcement procedures impact California's prior 
protectiveness determination for the associated standards, and (2) 
whether the procedures are consistent with section 202(a). The 
principles set forth by the court, however, are similarly applicable to 
an EPA review of a request for a waiver of preemption for a standard. 
The court instructed that ``the standard of proof must take account of 
the nature of the risk of error involved in any given decision, and it 
therefore varies with the finding involved. We need not decide how this 
standard operates in every waiver decision.'' \21\
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    \21\ Id.
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    With regard to the protectiveness finding, the court upheld the 
Administrator's position that, to deny a waiver, there must be ``clear 
and compelling evidence'' to show that proposed enforcement procedures 
undermine the protectiveness of California's standards.\22\ The court 
noted that this standard of proof also accords with the congressional 
intent to provide California with the broadest possible discretion in 
setting regulations it finds protective of the public health and 
welfare.\23\
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    \22\ Id.
    \23\ Id.
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    With respect to the consistency finding, the court did not 
articulate a standard of proof applicable to all proceedings, but found 
that the opponents of the waiver were unable to meet their burden of 
proof even if the standard were a mere preponderance of the evidence. 
Although MEMA I did not explicitly consider the standards of proof 
under section 209 concerning a waiver request for ``standards,'' as 
compared to a waiver request for accompanying enforcement procedures, 
there is nothing in the opinion to suggest that the court's analysis 
would not apply with equal force to such determinations. EPA's past 
waiver decisions have consistently made clear that: ``[E]ven in the two 
areas concededly reserved for Federal judgment by this legislation--the 
existence of `compelling and extraordinary' conditions and whether the 
standards are technologically feasible--Congress intended that the 
standards of EPA review of the State decision to be a narrow one.'' 
\24\
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    \24\ See, e.g., ``California State Motor Vehicle Pollution 
Control Standards; Waiver of Federal Preemption,'' 40 FR 23102 (May 
28, 1975), at 23103.
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D. EPA's Administrative Process in Consideration of California's CHE 
Amendment Request for Authorization

    On May 28, 2014, EPA published a Federal Register notice announcing 
its receipt of California's authorization

[[Page 26252]]

request. In that notice, EPA invited public comment on each of the CHE 
amendments and an opportunity to request a public hearing.\25\
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    \25\ See ``California State Nonroad Engine Pollution Control 
Standards; Mobile Cargo Handling Equipment at Ports and Intermodal 
Rail Yards Regulation; Request for Within-the-Scope and Full 
Authorization; Opportunity for Public Hearing and Comment,'' 79 FR 
30608 (May 28, 2014).
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    First, EPA requested comment on the CHE amendments, as follows: (1) 
Should California's CHE amendments be considered under the within-the-
scope analysis, or should they be considered under the full 
authorization criteria?; (2) If those amendments should be considered 
as a within-the-scope request, do they meet the criteria for EPA to 
grant a within-the-scope confirmation?; and (3) If the amendments 
should not be considered under the within-the-scope analysis, or in the 
event that EPA determines they are not within the scope of the previous 
authorization, do they meet the criteria for full authorization?
    EPA received one anonymous written comment that opposed ``any new 
Regulation or Rule promulgated by EPA on California State Non Road 
Engine Pollution Control Standards: Mobile Cargo Handling Equipment at 
Ports and Intermodal Rail Yards Regulations.'' \26\ EPA is not 
promulgating any regulations or rules regarding California's CHE 
regulations, but rather is adjudicating whether or not the amendments 
that CARB made to its own CHE regulations are within the scope of 
previous authorizations granted by EPA or fulfill the criteria for a 
full authorization under the Clean Air Act. EPA received no requests 
for a public hearing. Consequently, EPA did not hold a public hearing.
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    \26\ See EPA-HQ-OAR-2014-0060-0019.
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II. Discussion

    The CHE amendment package contains six categories of amendments. 
CARB seeks within-the-scope confirmation for the following amendments: 
(1) Modification to retrofit requirements; (2) modification of 
operation practices; (3) allowance of demonstration of emissions 
equivalency for alternative technology; and (4) modification of 
compliance requirements. CARB seeks a full authorization to enforce 
amendments that establish: (1) A new opacity based monitoring program; 
and (2) new retrofit requirements for engines meeting the Tier 4 Family 
Emission Limits standards.

A. Within-the-Scope Discussion

    California maintains that many of the CHE amendments were enacted 
to address a variety of implementation issues associated with the 
initial CHE regulations. CARB asserts that the amendments provide 
additional compliance flexibilities without sacrificing significant 
emission reductions.
    CARB's amendments to the retrofit requirements allow additional 
time for fleet owners/operators (fleets) to retrofit equipment for 
which no verified diesel emission control strategies (VDECS) are 
available. The retrofit amendments also add safety as a criterion for 
assessing VDECS availability, allow additional time to request a 
compliance date extension, and allow an extension of the time for the 
use of experimental diesel particulate matter emissions control 
strategies for the purpose of gathering verification data on such 
strategies.
    According to CARB, the amendments that modify the operational 
practice requirements involve four minor adjustments to the CHE 
regulations. These include a low-use compliance extension (a two-year 
extension for equipment that operates less than 200 hours per year), an 
allowance for cargo handling equipment other than yard trucks (``non-
truck CHE''), owned or leased by one party to be transferred to another 
location under certain limitations, an allowance for fleets to replace 
engines still under the original equipment manufacturer's warranty with 
replacement engines that meet the emission standards of the original 
engine, even when newer engine emission standards are in place for 
newly produced engines, and a new provision allowing fleets to rent 
non-compliant equipment in the event that compliant equipment is 
unavailable due to manufacturer delivery delays.
    The third set of amendments that CARB maintains are within the 
scope of the prior authorization establishes a compliance option that 
allows fleets to demonstrate emissions equivalency for alternative 
technology. CARB states that these amendments are designed to encourage 
introduction of new technologies such as hybrid and electric equipment.
    Finally, the fourth set of amendments modifies compliance 
requirements by establishing a compliance schedule that allows fleets 
to bring older engines into compliance first if owners and operators 
choose to do so, and by exempting equipment at rural low-throughput 
ports.\27\
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    \27\ The exemption applies if the average annual throughput of 
goods through a port is less than one million tons and the port is 
located more than 75 miles from an urban area.
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    CARB maintains that the amendments noted above meet all three 
within-the-scope criteria, i.e. that the amendments: (1) Do not 
undermine the original protectiveness determination underlying 
California's CHE regulations; (2) do not affect the consistency of the 
CHE regulations with section 209, and (3) do not raise any new issues 
affecting the prior authorizations.\28\ We received no adverse comments 
or evidence suggesting a within-the-scope analysis is inappropriate, or 
that these CHE amendments fail to meet any of the three criteria for 
within-the-scope confirmation.
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    \28\ Id. at 16.
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    With regard to the first within-the-scope prong, CARB maintains 
that the stringency of its emission standards is, in the aggregate, at 
least as protective of public health and welfare as applicable federal 
standards.\29\ CARB also notes that its amendments will not create any 
expected adverse environmental impacts.\30\ Finally, CARB notes that 
there can be no question that the CHE regulations are at least as 
protective of public health and welfare as applicable federal standards 
given that EPA is unable to regulate emissions from in-use nonroad 
engines and equipment and that no federally applicable regulations 
exist. EPA agrees that there are no federally applicable standards for 
in-use nonroad engines and that no evidence exists in the record to 
demonstrate that CARB's CHE regulations, in the aggregate, are less 
protective than applicable federal standards. Therefore, we cannot find 
that the CHE amendments, as noted, undermine the protectiveness 
determination made with regard to the original CHE authorization.
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    \29\ See CARB Board Resolution 11-30 (enclosure 4 of CARB's 
authorization request).
    \30\ See CARB Staff Report (enclosure 2 of CARB's authorization 
request).
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    With regard to the second within-the-scope prong (consistency with 
section 209), CARB maintains that the CHE amendments do not regulate 
new motor vehicles or motor vehicles engines and so are consistent with 
section 209(a). Likewise the CHE amendments do not regulate any of the 
permanently preempted categories of engines or vehicles, and so are 
consistent with section 209(e)(1). Finally, CARB maintains that the CHE 
amendments do not cause any technological feasibility issues or cause 
inconsistency between state and federal test procedures, per section 
209(b)(1)(C). CARB maintains that the CHE amendments, as noted, provide 
additional compliance flexibilities beyond the CHE regulations

[[Page 26253]]

already found to be technologically feasible. Because there is no 
evidence in the record to indicate that CARB's CHE amendments are 
inconsistent with section 209 we cannot find that the CHE amendments, 
as noted, are inconsistent with section 209.
    Third, California states that no new issues exist, and EPA has 
received no evidence to the contrary.\31\ We therefore do not find any 
new issues raised by the CHE amendments as noted.
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    \31\ CARB authorization support document at 14, docket entry 
EPA-HQ-OAR-2014-0060-0003.
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    Having received no contrary evidence regarding these amendments, we 
find that California has met the three criteria for a within-the-scope 
authorization approval, and these amendments are thus confirmed as 
within the scope of previous EPA authorizations of California's CHE 
regulations.

B. Full Authorization Discussion

    As noted above, CARB seeks a full authorization to enforce 
amendments that establish a new opacity based monitoring program and 
new retrofit requirements for engines meeting the Tier 4 Family 
Emission Limits standards.
    CARB's CHE amendments establish new in-use opacity standards and 
require owners/operators to conduct annual opacity monitoring of all 
CHE more than four years old from the date of its original manufacture 
to ensure proper operation and maintenance so that engines continue to 
perform as designed and certified. Retrofitted engines are similarly 
monitored to ensure that the engines continue to be in compliance with 
the VDECS executive order issued by CARB. Equipment found to be in 
excess of opacity standards would be required to receive maintenance 
and repair before being returned to service.
    Under the CHE regulation that EPA previously authorized, engine 
manufacturers are allowed some flexibility during periods in which 
emission standards are transitioning from one emission level (tier) to 
another emission level (tier). This flexibility allows engine 
manufacturers to certify a certain percentage of engines manufactured, 
and identified as being part of the more stringent tier, to emission 
levels that do not meet that more stringent tier. CARB established a 
family emission limit (FEL) alternate particulate matter (PM) emission 
standard (Tier 4 Alternate PM standard) that is essentially equivalent 
to the less stringent Tier 3 PM emission standard. The Tier 4 Alternate 
PM standard is about ten times higher than the otherwise applicable 
Tier 4 PM standard. Through inadvertent error by CARB, the CHE 
regulations allowed for in-use nonroad non-truck CHE to meet the 
applicable upgrade requirements by meeting the Tier 4 Alternate PM 
standard rather than the Tier 4 PM standard. CARB's CHE amendments 
correct this error by requiring fleets that used the FEL-certified 
engines to retrofit these engines with the highest available (best--
Tier 4) VDECS within one year.
    With regard to the first full authorization prong at section 
209(e)(2)(i) of the Act, CARB maintains that the stringency of its 
emission standards is, in the aggregate, at least as protective of 
public health and welfare as applicable federal standards.\32\ CARB 
also notes that its amendments will not create any expected adverse 
environmental impacts.\33\ Finally, CARB notes that there can be no 
question that its CHE regulation is at least as protective of public 
health and welfare as applicable federal standards given that EPA is 
unable to regulate emissions from in-use nonroad engines and equipment 
and that no federally applicable regulations exist. EPA agrees that 
there are no federally applicable standards for in-use nonroad engines 
and that no evidence exists in the record to demonstrate that CARB's 
CHE regulation is less protective, in the aggregate, than applicable 
federal standards. Accordingly, we cannot find that CARB's 
protectiveness finding is arbitrary and capricious.
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    \32\ See CARB Board Resolution 11-30 (enclosure 4 of CARB's 
authorization request).
    \33\ See CARB Staff Report (enclosure 2 of CARB's authorization 
request).
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    With regard to the second authorization criterion, section 
209(e)(2)(A)(ii) instructs that EPA cannot grant an authorization if 
the Agency finds that California ``does not need such California 
standards to meet compelling and extraordinary conditions.'' EPA's 
inquiry under this second criterion (found both in paragraphs 
209(b)(1)(B) and 209(e)(2)(A)(ii)) has been to determine whether 
California needs its own mobile source pollution program (i.e. set of 
standards) for the relevant class or category of vehicles or engines to 
meet compelling and extraordinary conditions, and not whether the 
specific standards that are the subject of the authorization or waiver 
request are necessary to meet such conditions.\34\ CARB notes that in 
adopting its CHE amendments the CARB Board confirmed its longstanding 
position that California continues to need its own nonroad engine 
emission program to meet serious air pollution problems.\35\ Based on 
the lack of evidence in the record or any suggestion that CARB no 
longer has a need for its standards to meet compelling and 
extraordinary conditions, we have no reason to deny CARB's 
authorization request based on this second authorization criterion.
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    \34\ See 74 FR 32744, 32761 (July 8, 2009); 49 FR 18887, 18889-
18890 (May 3, 1984).
    \35\ See CARB's Authorization Support document at 15, citing 
CARB Board Resolution 11-30.
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    Section 209(e)(2)(A)(iii) of the Act instructs that EPA cannot 
grant an authorization if California's standards and enforcement 
procedures are not consistent with ``this section.'' As described 
above, EPA's section 209(e) rule states that the Administrator shall 
not grant authorization to California if she finds (among other tests) 
that the ``California standards and accompanying enforcement procedures 
are not consistent with section 209.'' EPA has interpreted the 
requirement to mean that California standards and accompanying 
enforcement procedures must be consistent with at least section 209(a), 
section 209(e)(1), and section 209(b)(1)(C), as EPA has interpreted 
this last subsection in the context of motor vehicle waivers.\36\ Thus, 
this can be viewed as a three-pronged test.
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    \36\ See 59 FR 36969 (July 20, 1994).
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1. Consistency With Section 209(a)
    Section 209(a) of the Clean Air Act prohibits states or any 
political subdivisions of states from setting emission standards for 
new motor vehicles or new motor vehicle engines. Section 209(a) is 
modified in turn by section 209(b) which allows California to set such 
standards if other statutory requirements are met. To find a standard 
to be inconsistent with section 209(a) for purposes of section 
209(e)(2)(A)(iii), EPA must find that the standard in question actually 
regulates new motor vehicles or new motor vehicle engines. In its 
authorization request, CARB stated that by definition, the CHE 
amendments do not regulate new motor vehicles or new motor vehicle 
engines. EPA received no comments to suggest the contrary. Therefore, 
EPA cannot deny California's request based on the CHE amendments being 
inconsistent with section 209(a) of the Act.
2. Consistency With Section 209(e)(1)
    To be consistent with section 209(e)(1), California's standards or 
other requirements relating to the control of emissions must not relate 
to new engines which are used in farm or construction equipment or 
vehicles and which are smaller than 175 horsepower

[[Page 26254]]

(hp), and new locomotives or new engines used in locomotives.
    CARB maintains that its CHE amendments do not regulate new engines 
which are used in construction or farm equipment or vehicles below 175 
hp, nor do the CHE amendments regulate new locomotives or new engines 
used in locomotives.
    In light of the lack of contrary information in the record, EPA 
cannot make a finding that CARB's CHE amendments are inconsistent with 
section 209(e)(1). Therefore, EPA cannot deny CARB's authorization 
request on this basis.
3. Consistency With Section 209(b)(1)(C)
    The requirement that California's standards be consistent with 
section 209(b)(1)(C) of the Clean Air Act effectively requires 
consistency with section 202(a) of the Act. To determine this 
consistency, EPA has applied to California nonroad standards the same 
test it has used previously for California motor vehicle standards; 
namely, state standards are inconsistent with section 202(a) of the Act 
if there is inadequate lead-time to permit the development of 
technology necessary to meet those requirements, giving appropriate 
consideration to the cost of compliance within that timeframe. 
California's accompanying enforcement procedures would also be 
inconsistent with section 202(a) if federal and California test 
procedures conflicted. The scope of EPA's review of whether 
California's action is consistent with section 202(a) is narrow. The 
determination is limited to whether those opposed to the authorization 
or waiver have met their burden of establishing that California's 
standards are technologically infeasible, or that California's test 
procedures impose requirements inconsistent with the federal test 
procedures.\37\
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    \37\ See, e.g., Motor and Equip. Mfrs Assoc. v. EPA, 627 F.2d 
1095 (D.C. Cir. 1979) (``MEMA I'').
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    CARB states that the smoke opacity test is a quick and inexpensive 
way to detect if an engine is emitting excessive emissions. CARB 
maintains that the smoke opacity test is technologically feasible and 
that compliance with the standards does not require the incorporation 
of any new technology not already required by existing regulations that 
have previously received an EPA authorization. CARB also states that 
the clarification of the Tier 4 FEL emission standards provisions are 
technologically feasible and were designed to correct an unintentional 
error and to clarify the original intent of the previously authorized 
CHE regulations. The CHE amendments only require retrofit to the Tier 4 
emission level if appropriate technology is available and require the 
retrofit be performed within one year. EPA did not receive any comment 
or evidence to suggest that either of the two amendments for which CARB 
requested authorization is technologically infeasible.
    Consequently, based on the record, EPA is unable to make the 
finding that the CHE amendments are not technologically feasible with 
the available lead time giving consideration to the cost of compliance.
    EPA received no comments suggesting that CARB's CHE amendments pose 
any test procedure consistency problem. Therefore, based on the record, 
EPA cannot find that CARB's testing procedures are inconsistent with 
section 202(a) and cannot deny CARB's request based on this criterion.

III. Decision

    The Administrator has delegated the authority to grant California 
section 209(e) authorizations to the Assistant Administrator for Air 
and Radiation. After evaluating CARB's amendments to its CHE 
regulations described above and CARB's submissions for EPA review, EPA 
is taking the following actions.
    First, EPA is granting a within-the-scope authorization for the CHE 
amendments that modify the retrofit requirements, modify operational 
practices, allow demonstration of emissions equivalency for alternative 
technology, and modify compliance requirements.
    Second, EPA is granting a full authorization for the CHE amendments 
that establish a new opacity based monitoring program and new retrofit 
requirements for engines meeting the Tier 4 FEL standards.
    This decision will affect persons in California and those 
manufacturers and/or owners/operators nationwide who must comply with 
California's requirements. In addition, because other states may adopt 
California's standards for which a section 209(e)(2)(A) authorization 
has been granted if certain criteria are met, this decision would also 
affect those states and those persons in such states. See CAA section 
209(e)(2)(B). For these reasons, EPA determines and finds that this is 
a final action of national applicability, and also a final action of 
nationwide scope or effect for purposes of section 307(b)(1) of the 
Act. Pursuant to section 307(b)(1) of the Act, judicial review of this 
final action may be sought only in the United States Court of Appeals 
for the District of Columbia Circuit. Petitions for review must be 
filed by July 6, 2015. Judicial review of this final action may not be 
obtained in subsequent enforcement proceedings, pursuant to section 
307(b)(2) of the Act.

IV. Statutory and Executive Order Reviews

    As with past authorization and waiver decisions, this action is not 
a rule as defined by Executive Order 12866. Therefore, it is exempt 
from review by the Office of Management and Budget as required for 
rules and regulations by Executive Order 12866.
    In addition, this action is not a rule as defined in the Regulatory 
Flexibility Act, 5 U.S.C. 601(2). Therefore, EPA has not prepared a 
supporting regulatory flexibility analysis addressing the impact of 
this action on small business entities.
    Further, the Congressional Review Act, 5 U.S.C. 801, et seq., as 
added by the Small Business Regulatory Enforcement Fairness Act of 
1996, does not apply because this action is not a rule for purposes of 
5 U.S.C. 804(3).

    Dated: April 29, 2015.
Janet G. McCabe,
Acting Assistant Administrator, Office of Air and Radiation.
[FR Doc. 2015-11034 Filed 5-6-15; 8:45 am]
 BILLING CODE 6560-50-P