[House Hearing, 107 Congress]
[From the U.S. Government Publishing Office]


 
 CLEAN AIR ACT IMPLEMENTATION: EXPERIENCE OF STATE AND LOCAL REGULATORS
=======================================================================

                                HEARING

                               before the

                 SUBCOMMITTEE ON ENERGY AND AIR QUALITY

                                 of the

                    COMMITTEE ON ENERGY AND COMMERCE
                        HOUSE OF REPRESENTATIVES

                      ONE HUNDRED SEVENTH CONGRESS

                             SECOND SESSION

                               __________

                              JUNE 5, 2002

                               __________

                           Serial No. 107-119

                               __________

       Printed for the use of the Committee on Energy and Commerce


 Available via the World Wide Web: http://www.access.gpo.gov/congress/
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                               __________
                    COMMITTEE ON ENERGY AND COMMERCE

               W.J. ``BILLY'' TAUZIN, Louisiana, Chairman

MICHAEL BILIRAKIS, Florida           JOHN D. DINGELL, Michigan
JOE BARTON, Texas                    HENRY A. WAXMAN, California
FRED UPTON, Michigan                 EDWARD J. MARKEY, Massachusetts
CLIFF STEARNS, Florida               RALPH M. HALL, Texas
PAUL E. GILLMOR, Ohio                RICK BOUCHER, Virginia
JAMES C. GREENWOOD, Pennsylvania     EDOLPHUS TOWNS, New York
CHRISTOPHER COX, California          FRANK PALLONE, Jr., New Jersey
NATHAN DEAL, Georgia                 SHERROD BROWN, Ohio
RICHARD BURR, North Carolina         BART GORDON, Tennessee
ED WHITFIELD, Kentucky               PETER DEUTSCH, Florida
GREG GANSKE, Iowa                    BOBBY L. RUSH, Illinois
CHARLIE NORWOOD, Georgia             ANNA G. ESHOO, California
BARBARA CUBIN, Wyoming               BART STUPAK, Michigan
JOHN SHIMKUS, Illinois               ELIOT L. ENGEL, New York
HEATHER WILSON, New Mexico           TOM SAWYER, Ohio
JOHN B. SHADEGG, Arizona             ALBERT R. WYNN, Maryland
CHARLES ``CHIP'' PICKERING,          GENE GREEN, Texas
Mississippi                          KAREN McCARTHY, Missouri
VITO FOSSELLA, New York              TED STRICKLAND, Ohio
ROY BLUNT, Missouri                  DIANA DeGETTE, Colorado
TOM DAVIS, Virginia                  THOMAS M. BARRETT, Wisconsin
ED BRYANT, Tennessee                 BILL LUTHER, Minnesota
ROBERT L. EHRLICH, Jr., Maryland     LOIS CAPPS, California
STEVE BUYER, Indiana                 MICHAEL F. DOYLE, Pennsylvania
GEORGE RADANOVICH, California        CHRISTOPHER JOHN, Louisiana
CHARLES F. BASS, New Hampshire       JANE HARMAN, California
JOSEPH R. PITTS, Pennsylvania
MARY BONO, California
GREG WALDEN, Oregon
LEE TERRY, Nebraska
ERNIE FLETCHER, Kentucky

                  David V. Marventano, Staff Director

                   James D. Barnette, General Counsel

      Reid P.F. Stuntz, Minority Staff Director and Chief Counsel

                                 ______

                 Subcommittee on Energy and Air Quality

                      JOE BARTON, Texas, Chairman

CHRISTOPHER COX, California          RICK BOUCHER, Virginia
  Vice Chairman                      RALPH M. HALL, Texas
RICHARD BURR, North Carolina         TOM SAWYER, Ohio
ED WHITFIELD, Kentucky               ALBERT R. WYNN, Maryland
GREG GANSKE, Iowa                    MICHAEL F. DOYLE, Pennsylvania
CHARLIE NORWOOD, Georgia             CHRISTOPHER JOHN, Louisiana
JOHN SHIMKUS, Illinois               HENRY A. WAXMAN, California
HEATHER WILSON, New Mexico           EDWARD J. MARKEY, Massachusetts
JOHN SHADEGG, Arizona                BART GORDON, Tennessee
CHARLES ``CHIP'' PICKERING,          BOBBY L. RUSH, Illinois
Mississippi                          KAREN McCARTHY, Missouri
VITO FOSSELLA, New York              TED STRICKLAND, Ohio
ROY BLUNT, Missouri                  THOMAS M. BARRETT, Wisconsin
ED BRYANT, Tennessee                 BILL LUTHER, Minnesota
STEVE BUYER, Indiana                 JOHN D. DINGELL, Michigan
GEORGE RADANOVICH, California          (Ex Officio)
MARY BONO, California
GREG WALDEN, Oregon
W.J. ``BILLY'' TAUZIN, Louisiana
  (Ex Officio)

                                  (ii)









                            C O N T E N T S

                               __________
                                                                   Page

Testimony of:
    Jones, Christopher, Director, Ohio Environmental Protection 
      Agency.....................................................    14
    Lempke, Doug, Administrator, Air Quality Control Commission, 
      Colorado Department of Public Health and Environment.......    37
    Nicholson, Brock, Chief of Air Quality Planning, North 
      Carolina Department of Environment and Natural Resources...    24
    Nielson, Dianne R., Executive Director, Utah Department of 
      Environmental Quality......................................    10
    Williams, Arthur L., Director, Jefferson County Air Pollution 
      Control District, on behalf of STAPPA/ALAPCO...............    29
Additional material submitted for the record:
    Southern Appalachian Mountains Initiative....................    54

                                 (iii)

  


 CLEAN AIR ACT IMPLEMENTATION: EXPERIENCE OF STATE AND LOCAL REGULATORS

                              ----------                              


                        WEDNESDAY, JUNE 5, 2002

                  House of Representatives,
                  Committee on Energy and Commerce,
                    Subcommittee on Energy and Air Quality,
                                                    Washington, DC.
    The subcommittee met, pursuant to notice, at 2 p.m., in 
room 2123, Rayburn House Office Building, Hon. Joe Barton 
(chairman) presiding.
    Members present: Representatives Barton, Burr, Whitfield, 
Shimkus, Shadegg, Boucher, Sawyer, Waxman, Markey, McCarthy, 
Strickland, and Barrett.
    Staff present: Bob Meyers, majority counsel; Joseph Stanko, 
majority counsel; Andy Black, policy coordinator; Hollyn Kidd, 
legislative clerk; Michael L. Goo, minority counsel; and 
Courtney Anderson, minority research assistant.
    Mr. Barton. The subcommittee will come to order.
    The Chair would recognize himself for an opening statement.
    This afternoon the Subcommittee on Energy and Air Quality 
will continue its series of hearings on the Clean Air Act. Our 
last hearing covered the accomplishments of the Clean Air Act. 
In that hearing, the subcommittee received testimony from 
academic, environmental, and public health groups concerning 
the significant progress that has been made toward achieving 
Federal air quality standards.
    Today's hearing will focus on implementation of the Clean 
Air Act, specifically the experiences of State and local 
regulators in implementing emissions reductions programs. 
Importantly, the subcommittee will hear from those on the front 
line of Clean Air Act implementation, the State and local 
officials responsible for ensuring that the States meet the 
Federal air quality standards established by the Environmental 
Protection Agency.
    Under the subcommittee realignment that began at the first 
of this Congress, the clean air jurisdiction is now within the 
subcommittee that I chair, the Energy and Air Quality 
Subcommittee. I note that I am one of the few current Energy 
and Commerce Committee members who participated in the last 
major reauthorization of the Clean Air Act back in 1990.
    I hope that our hearing today will be a part of a larger 
record upon which this subcommittee and the full committee can 
later build another equally bipartisan and effective review of 
the Clean Air Act.
    I am also one of many Members of Congress who believes that 
all wisdom does not reside in Washington, DC. For that reason, 
I am eager to hear the experiences of our panel of State and 
local regulators who were kind enough to come to Washington 
today and educate us about the real world implementation 
issues.
    I cannot emphasize how important these State officials have 
been in achieving our Nation's significant improvement in air 
quality. We Federal legislators should certainly heed their 
remarks when determining what approach, if any, in terms of new 
thinking are appropriate for future programs.
    Our panel today has officials from the States of Utah, 
Ohio, North Carolina, Colorado, and Kentucky. So we have got a 
cross-reference of the geography of this great Nation in terms 
of the State regulators that are here--officials that are here 
today. I look forward to hearing their testimony.
    Our ranking member on the Democratic side, Mr. Rick Boucher 
of Virginia, is in his district this afternoon and cannot be 
here. So taking his place very ably is the distinguished 
Congressman from Ohio, Mr. Sawyer, and I would recognize him 
now for an opening statement.
    Mr. Sawyer. Well, thank you, Mr. Chairman, and thank you 
for holding this second hearing today on the Clean Air Act.
    As a consequence of the work that has been done over the 
last now more than 30 years, this country has made enormous 
progress in terms of the quality of air. It is sometimes 
difficult to measure the benefits of the work that we do in 
Congress, but the Clean Air Act is a clear example of the 
public good that can come from legislation when we work at it.
    Nothing is easy. It requires long-term grip, tenacity, and 
effort. But the Clean Air Act has had that indeed. Overall 
levels of pollution in this country have dropped nearly 30 
percent. Cars in the 2004 model year will be 99 percent cleaner 
than those produced in 1970. Quite simply, we benefit from the 
Clean Air Act with every breath we take.
    It demonstrates that this country can achieve ambitious 
environmental objectives that it sets for itself when it makes 
the goals clear and measures progress toward them. But as the 
recent EPA report submitted to the U.N. reveals, we still have 
to confront the issue of global warming in this country and 
develop meaningful solutions to address it.
    The U.S. would still increase the overall amount of 
greenhouse gases at the same rate that we are today. The 
President's 17.5 percent target is almost the same as the 17.4 
percent reduction that we experienced from 1990 to 2000. It 
almost guarantees that we will have much higher emissions of 
greenhouse gases in 10 years, and we will have done little to 
address the serious problem of global warming.
    We have technology to reduce the emissions of greenhouse 
gases. Now we need a--goodness gracious.
    Mr. Barton. Will the gentleman yield?
    Mr. Sawyer. This is the furthest extent that I have seen 
Western Virginia extend in 200 years.
    Mr. Barton. I just announced that you were in your district 
this afternoon.
    Mr. Boucher. Well, let me say that I have made an 
unexpected appearance for the purpose of contributing an 
opening statement, and I want to express my appreciation to Mr. 
Sawyer for being willing to carry out ranking member 
responsibilities this afternoon. But I did want to make a 
statement, so after----
    Mr. Sawyer. As soon as I am done, why----
    Mr. Barton. He is ranking now.
    Mr. Sawyer. In short, what I was about to say was that we 
need a comprehensive Federal policy for setting benchmarks for 
compliance. The President's plan recognizes the benefits of cap 
and trade programs, and I am eager to hear testimony about how 
those programs have worked in the States.
    The acid ran cap and trade program of 1990 has been 
remarkably successful, and I am convinced that with care and 
design achievable targets and careful management of a trading 
system that we can do the same thing. It offers great promise 
with regard to global warming.
    I am also interested in learning more about the challenges 
that you faced at the State level and the approaches you have 
developed that can be applied more broadly across the country.
    Our witnesses, Mr. Chairman, are the ones that are in the 
trenches. They know what the difficulties have been in bringing 
communities into compliance with Federal requirements. I 
understand your need for flexibility in designing those 
approaches, and I commend you all today for your work at the 
State levels, and I am pleased to welcome and recognize Chris 
Jones from my State of Ohio.
    With that, Mr. Chairman, I yield back the balance of Mr. 
Boucher's time.
    Mr. Barton. I thank the gentleman.
    We would recognize the distinguished vice chairman of the 
subcommittee, Mr. Shimkus, for an opening statement.
    Mr. Shimkus. Mr. Chairman, if I may, I am not sure if the 
gentleman from Virginia is in a time crunch. But if he is, I am 
willing to give him my 5 minutes, so that he can expedite----
    Mr. Barton. All right. The gentleman from----
    Mr. Shimkus. [continuing] I yield my time to the gentleman 
from Virginia.
    Mr. Barton. [continuing] Reserves his time, and he is going 
to let Mr. Boucher give an opening statement.
    Mr. Boucher. Well, thank you very much, Mr. Chairman. And, 
Mr. Shimkus, thank you for your courtesies. And, Mr. Sawyer, 
thank you so much for taking this responsibility this 
afternoon. I regret that I will not be able to stay for the 
balance of the hearing.
    I did want to take this opportunity, however, to thank the 
chairman for scheduling this hearing and, in fact, a series of 
hearings that are planned as we examine the Clean Air Act and 
the experience that our Nation has had under this series of 
clean air requirements. Many of the provisions of the Clean Air 
Act set national air quality standards and then direct State 
and local regulators to develop and implement strategies for 
meeting the guidelines that have been set forth at the Federal 
level.
    States and local regulators have truly been on the front 
lines in improving our Nation's air quality as they have 
discharged this responsibility under the Federal clean air 
laws.
    The State and local regulators have been largely successful 
in meeting their goals. Since enactment of the Clean Air Act 
and of the 1990 amendments to the law, the Nation has made 
significant progress in reducing emissions and improving air 
quality while the Nation's economy and energy use have 
expanded.
    From 1970 to 1999, the gross domestic product of the United 
States increased by 158 percent, and during that same period 
electricity use increased by 148 percent. Despite these 
increases and general economic activity, and in the pace of 
energy consumption, the Nation's air is much cleaner today than 
it was in 1970.
    During the last 30 years, sensible environmental 
regulations, along with new technology and voluntary actions by 
our Nation's industry, have led to a significant reduction in 
air emissions. Sulfur dioxide emissions have declined by 39 
percent. Particulate matter has declined by 75 percent. 
Airborne lead levels are down 98 percent. And volatile organic 
compounds have decreased by 42 percent.
    In addition, coal use has increased by 195 percent during 
this period of time, while total emissions per ton of coal 
consumed have decreased by 70 percent since 1970. Particulate 
matter levels from coal-based utilities decreased 84 percent 
between 1970 and 1998.
    Our Nation's air has been getting cleaner while coal use by 
electric utilities has been steadily increasing. These 
improvements in air quality have been due largely to the 
success of the Clean Air Act of 1970 and the 1990 amendments. 
And the success of the Clean Air Act has been due, in 
significant part, to the efforts that have been made by State 
and local regulators as they have implemented the provisions of 
the Federal law.
    The witnesses testifying before the subcommittee today have 
extensive knowledge about the Nation's air quality and the 
implementation of the Clean Air Act. While I will not be here 
to hear the testimony, I look forward to reading the testimony 
that these witnesses are presenting regarding the progress in 
improving air quality which has been made by this Nation over 
the past 30 years, and the ways in which their State and local 
agencies have contributed substantially to achieving that 
success.
    I particularly look forward to reading the testimony of 
these witnesses regarding their opinions on the strengths and 
weaknesses of the Clean Air Act, their views on the 
practicality of the Act's requirements, and their 
recommendations for any potential changes to the Act that they 
would suggest that this subcommittee consider.
    Mr. Chairman, thank you again for scheduling this timely 
consideration by the subcommittee, and I welcome the testimony 
of our witnesses.
    Mr. Sawyer. Mr. Chairman, I would at this point ask 
unanimous consent that all members have the opportunity to 
submit their full statements for the record.
    Mr. Shimkus [presiding]. If there is no objection, so 
ordered.
    The Chair recognizes the gentleman from North Carolina, Mr. 
Burr.
    Mr. Burr. I thank the chair. Mr. Chairman, it is my 
pleasure to use my opening statement to introduce Brock 
Nicholson from North Carolina Division of Air Quality. This is 
Brock's second tour of duty with the State government serving 
this time as the State's chief of air quality planning. Prior 
to rejoining State government, Brock was the chief of the ozone 
and carbon monoxide development section of EPA's agency office 
of air quality, planning, and standards.
    A registered professional engineer, Brock holds a 
mechanical engineering degree from North Carolina State and is 
a retired commission officer with the United States Public 
Health Service. Most recently, Brock has been working with our 
State's industry, environmental enthusiasts, and elected 
officials to craft a North Carolina Clean Smokestacks Bill.
    Six months ago I would have given the chances that 
industry, the environmental community, and State government 
would have been able to reach an agreement on legislation that 
reduces emissions without increasing electricity rates for our 
consumers about the same chances I would have given the 
Carolina Hurricanes at being in the Stanley Cup.
    Well, as of today, a bill has passed the State Senate on 
April 25. Governor Mike Easley announced that the State's two 
largest investor-owned utilities have agreed on the framework 
of legislation that accomplishes lower emissions without 
raising rates on retail customers.
    And, yes, the Hurricanes are up one to zero in the Stanley 
Cup finals over our ranking minority member Mr. Dingell's 
Detroit Red Wings after last night's overtime win.
    The framework of North Carolina's legislation would lower 
sulfur dioxide emissions to 250,000 tons by January 1, 2009, 
and 130,000 tons by January 1, 2013; lower nitrogen oxide 
emissions to 60,000 tons by January 1, 2017, and 56,000 tons by 
January 1, 2009.
    This legislation is a great example of State initiatives 
that should be given the flexibility to operate above and 
beyond the framework of EPA regulations. I hope that Mr. 
Nicholson will be able to share with us his experience with 
North Carolina's legislative success, specifically the 
requirement to study mercury emissions, the uncertainties in 
mercury control and the health and economic benefits of 
additional studies of this issue.
    Brock, I know that these are difficult budget times in 
Raleigh, North Carolina, on behalf of the committee. I would 
like to thank you for taking the time off to be with us.
    With that, I yield back my time.
    Mr. Sawyer. Will the gentleman yield?
    Mr. Burr. I would be happy to yield.
    Mr. Sawyer. Is it true, as I heard reported over the 
weekend, that if, in fact, indeed North Carolina beat Detroit 
that this would have been the first time that they had beaten 
Detroit in any setting since 1989?
    Not to rub it in, Mr.----
    Mr. Burr. The gentleman is incorrect.
    Mr. Sawyer. Incorrect.
    Mr. Shimkus. The gentleman's time has expired. The Chair 
recognizes the gentleman from Ohio, Mr. Strickland.
    Mr. Strickland. Thank you, Mr. Chairman.
    I am especially glad that Mr. Jones is here today. Mr. 
Jones, I appreciate your attendance. I have reviewed your 
testimony about the implementation of the Clean Air Act. I make 
note of the fact that you are going to mention the city of 
Steubenville in your testimony, a place that is near and dear 
to my heart.
    However, an urgent matter regarding the Portsmouth Gaseous 
Diffusion Plant I think warrants immediate attention, and so I 
would like to direct your attention to that.
    Yesterday evening the Department of Energy held a public 
hearing about dumping 14,000 metric tons of uranium waste at 
the Portsmouth site in my district. Over the past, I have 
worked with your staff to ensure that thousands of canisters of 
depleted uranium hexofluoride that are currently onsite are 
converted to a more stable form and stored safely.
    I know your agency is concerned that the construction of a 
conversion facility get underway as soon as possible, but now 
it is apparent that DOE has not only failed to begin the 
conversion of the DUF6 since passage of Public Law 105-204, 
which we passed in 1998, but now DOE intends to compound the 
problem by making Portsmouth a dumping ground for all of the 
Department's low energy uranium, natural uranium, and depleted 
uranium, which is now stored at over 150 sites within the DOE 
complex.
    I have learned that this amount of waste would more than 
triple the amount of uranium material stored onsite. This plan 
by DOE is an outrage. I will not stand by quietly while 
Southern Ohio gets dumped on.
    The United States Enrichment Corporation was privatized in 
1998, and we were assured that layoffs would be limited. Well, 
since privatization, I hear regularly about more layoffs at the 
plant. The brilliant decision to privatize USEC, which I 
strongly opposed, resulted in the closure of the Portsmouth 
plant last year, the only plant in the country capable of 
enriching uranium to commercial specifications using natural 
feed.
    Approximately 2 years after privatization, $630 million was 
announced for the Portsmouth site in October of 2000. 
Unfortunately, the Bush administration reversed that decision 
during the President's first day in office. As I mentioned, we 
were also promised a DUF6 conversion facility, and this 
administration continues to deny that it is required by law to 
build two such facilities, one in Portsmouth, Ohio, and one in 
Paducah, Kentucky.
    When DOE announced it would ship materials from Fernald to 
Portsmouth, we were told that jobs were at stake. Only a 
handful of jobs were created under this mission, and now the 
fact that the Fernald material is already at the Portsmouth 
site serves as a justification for dumping more of the 
Department's waste on the communities in Southern Ohio.
    It seems as if the Department wants to clean up Fernald, as 
they promised to do and should do. But in order to accomplish 
this, they want to dump the material on Portsmouth. It is 
unacceptable.
    I feel that 14,000 metric tons of uranium waste will render 
the site completely unattractive for economic development 
opportunities, and that would be a disaster for a part of the 
State that is already economically distressed.
    Director Jones, I intend to call upon our two Senators, 
DeWine and Voinovich, the Governor, Governor Taft, and my 
colleagues Portman and Ney to do everything that we can to 
oppose this unwise and unwarranted decision on the part of DOE 
to further dump on Southern Ohio.
    I return the balance of my time, Mr. Chairman.
    Mr. Shimkus. The gentleman's time has expired. I now 
recognize myself for a brief opening statement.
    Under the 1998 amendments to the Clean Air Act, six areas 
in Illinois were designed as non-attainment for one or more 
criteria pollutants. As a result of Illinois' efforts, five of 
those areas have since come into attainment. Illinois was able 
to improve their air quality through a number of common-sense 
voluntary and market-driven approaches.
    For example, the State started the Emission Reduction 
Market System, a volatile organic materials emissions trading 
program. Illinois was the first State in the Nation to adopt 
this type of cap and trade program for volatile organic 
materials, which contribute to the formulation of ground-level 
ozone or smog. The program is a cost-effective way to obtain 
emissions reductions.
    Overall, in 2001, participating sources emitted 52 percent 
less in their baselines and 46 percent less than their 
allotments of trading units. The State has established a 
program called Partners for Clean Air, a voluntary organization 
which was established in 1995 and is comprised of over 300 
businesses, industries, local governments, and health 
organizations, and representing thousands of employees.
    Members of the Partners for Clean Air commit to taking 
voluntary green actions, which is vanpooling, public 
transportation, limited use of energy, deferring gas-powered 
lawnmowering, etcetera, to reduce ozone precursor emissions for 
forecasted ozone action days.
    Tax credit and rebate programs are another tool the State 
has used to reduce pollution. From January 1997 through the end 
of this month, Illinois offered a rebate program for motorists 
who purchased alternative fuel vehicles or converted 
conventional vehicles to alternative fuel vehicles.
    Rebates were offered for 80 percent of the conversion costs 
or original equipment costs, 80 percent of the fuel cost 
differential over a 3-year period not to exceed $4,000 per 
vehicle. This coming Saturday, the State is also asking 
citizens to trade in old gas-driven lawnmowers. In return, they 
receive a $60 coupon toward purchase of a more environmentally 
friendly lawnmower.
    In my past comments, I talked about how the Clean Air Act 
really devastated Southern Illinois and the coal industry and 
some of the other energy producing sectors of the economy. Even 
with that, Illinois has moved significantly forward to help 
clean up their air. And with clean coal technology and a new 
positive energy bill, we look forward to being able to move 
both generating electricity for the country and doing it in a 
very positive environment way.
    And with that, I will end my statements, and now yield to 
the gentleman from California, Mr. Waxman, for 5 minutes.
    Mr. Waxman. Mr. Chairman, thank you for holding this 
hearing.
    Today we will hear from State and local officials regarding 
their experiences with implementation of the Clean Air Act. The 
States have a critical role in meeting our clean air goals. The 
Federal Government has delegated implementation of 
environmental laws to the States, and each year gives the 
States millions in Federal funds to ensure that the laws are 
adequately implemented.
    This approach gives the States flexibility to find workable 
solutions while providing a Federal guarantee that we are 
working toward healthful air throughout the country. Today's 
witnesses will discuss some of their successes under this 
approach.
    When learning of the State's impressive work, we must 
remember the importance of maintaining a strong Federal 
backstop for clean air. There are many sources that the States 
are not in a position to properly regulate, particularly those 
sources which have out-of-State impacts. Additionally, it would 
be impractical to have every State regulating the emissions of 
cars, trucks, airplanes, and other mobile sources. Moreover, 
not all States do an adequate job at cleaning up air pollution.
    For these reasons, it is essential that we maintain a 
balance in the Clean Air Act and keep a strong Federal rule in 
ensuring clean air. As a series of audits from the EPA's Office 
of Inspector General made clear a few years ago, States are 
sometimes failing to police even the most basic requirements of 
our Nation's clean air and water laws.
    That is why I have fought over the years to maintain the 
Federal role in the Clean Air Act and why big polluters try 
year after year to weaken Federal oversight and enforcement. 
And, unfortunately, the polluters all too often find allies to 
help them with this effort.
    In 1995, the Republican leadership in Congress attempted to 
defund the environmental enforcement attorneys at the 
Department of Justice. In 1998, the Republican leadership 
attempted to cut EPA's enforcement budget by $10 million. Last 
year, President Bush proposed to cut EPA's enforcement budget 
by $25 million and reduced the EPA's enforcement staff by some 
200 positions. And this year, the President has again proposed 
slashing EPA's enforcement staff by over 200 positions.
    This is a serious matter. Without adequate enforcement, our 
environmental laws will undoubtedly fall short of their 
intended goal.
    I welcome today's witnesses and look forward to hearing 
from them.
    Thank you, Mr. Chairman.
    Mr. Shimkus. The gentleman yields back his time.
    [Additional statements submitted for the record follow:]
   Prepared Statement of Hon. George Radanovich, a Representative in 
                 Congress from the State of California
    Good afternoon, and thank you Mr. Chairman for holding this hearing 
today on the experience of state and local regulators in implementing 
the Clean Air Act.
    After reviewing the purpose of this hearing with local regulators, 
I have three critical issues to discuss that are of great importance to 
the San Joaquin Valley congressional district I represent in 
California.
    To begin, one of the major issues is that the EPA has not 
recognized the San Joaquin Valley Air Pollution Control District's 
local operating permit program as equivalent to the Title V program 
under the Clean Air Act 1990 amendments.
    The primary distinction between the federal Title V program and the 
local programs in California is administrative. The federal regulation 
prescribes numerous detailed administrative requirements, which pose 
significant economic burden on the permitting agencies as well as many 
small businesses, without any resultant air quality benefit. As a 
result, I believe EPA should recognize the San Joaquin Valley air 
district's permitting program as equivalent to the federal program.
    Another issue of concern in my congressional district, is the 
discounting of Emission Reductions Credits (ERCs) at the time of use, 
as required by EPA. California uses a different model to bank ERCs and 
can demonstrate that, taken as a whole, its programs result in greater 
reduction in emissions without having to discount ERCs at the time of 
use. Because of the viability of California's program, I believe EPA 
should recognize and allow California the ability to continue its 
current ERC discount program.
    Finally, I also have an interest in the development of markets for 
the trading of non-point source air pollution credits with fixed 
sources. Several experiments in the trading of water pollution credits 
between non-point and fixed sources have resulted in significant 
improvement in overall water quality. That method should be applied to 
the establishment of similar markets in the air quality arena to 
determine whether like results occur. I know that there has been some 
initial work done in this regard in California, and we ought to ensure 
that we do not miss an opportunity to use market innovations to improve 
overall air quality.
    In closing, I look forward to hearing the experiences of our 
witnesses and am ready to work with this Subcommittee and the 
Administration to resolve Clean Air Act issues facing state and local 
regulators.
                                 ______
                                 
Prepared Statement of Hon. W.J. ``Billy'' Tauzin, Chairman, Ciommittee 
                         on Energy and Commerce
    Today, Chairman Joe Barton's Subcommittee continues its series of 
Clean Air Act hearings. I applaud Chairman Barton for assembling 
another informative panel for our Members.
    I, along with several other Members still on the Committee, crafted 
the last major revision of Clean Air Act, the extremely successful 1990 
Amendments. Looking back on that process a decade ago, I am proud of 
the bipartisan nature in which the Committee conducted its business. I 
know that, under Chairman Barton's leadership, that same bipartisan 
tradition continues with the Energy and Air Quality Subcommittee's 
current examination of the Clean Air Act.
    I am eager to hear from today's panel of state and local air 
regulators. Of course, it is the states that must take the policy we 
establish here in Congress and make it work our there in the real 
world. Accordingly, it is critical that we receive feedback from states 
regarding what has, and has not, worked under the current program. Our 
shared goal is cleaner air, with a strong economy. We can have both.
    I thank the witnesses for taking time out of their busy schedules 
to come to Washington and participate in today's hearing. I look 
forward to their testimony.
    Mr. Chairman, I yield back my time.
                                 ______
                                 
 Prepared Statement of Hon. Bill Luther, a Representative in Congress 
                      from the State of Minnesota
    Mr. Chairman, thank you for holding this hearing today. State and 
local regulators are our partners in trying to effectively implement 
the Clean Air Act and it is essential that we hold hearings to get 
their perspective on how to reach the goal of improving the nation's 
overall air quality. I am especially interested in hearing about states 
that have gone beyond current federal requirements in an attempt to 
combat regional air quality concerns.
    I am also very concerned about possible changes to the New Source 
Review program that have been rumored for months. If the Administration 
moves forward with plans to relax NSR standards, I believe it essential 
that the strong clean air and public health standards under the current 
program not be sacrificed. If there are fundamental problems to the NSR 
program, as many have claimed, I believe it is this committee's 
responsibility to hold investigative hearings on the matter. I look 
forward to any insight today's state and local regulators may have on 
the issue and I look forward to the testimony. Thank you.

    Mr. Shimkus. Now I would like to ask the panel to take 
their seats. And we would first like to hear from Ms. Dianne 
Nielson, Executive Director of Utah Department of Environmental 
Quality. You will have 7 minutes to give your opening 
statements. Your full statement is in the record already. The 
time is yours. Welcome.

   STATEMENTS OF DIANNE R. NIELSON, EXECUTIVE DIRECTOR, UTAH 
    DEPARTMENT OF ENVIRONMENTAL QUALITY; CHRISTOPHER JONES, 
     DIRECTOR, OHIO ENVIRONMENTAL PROTECTION AGENCY; BROCK 
   NICHOLSON, CHIEF OF AIR QUALITY PLANNING, NORTH CAROLINA 
  DEPARTMENT OF ENVIRONMENT AND NATURAL RESOURCES; ARTHUR L. 
  WILLIAMS, DIRECTOR, JEFFERSON COUNTY AIR POLLUTION CONTROL 
    DISTRICT, ON BEHALF OF STAPPA/ALAPCO; AND DOUG LEMPKE, 
    ADMINISTRATOR, AIR QUALITY CONTROL COMMISSION, COLORADO 
          DEPARTMENT OF PUBLIC HEALTH AND ENVIRONMENT

    Ms. Nielson. Thank you very much, Mr. Chairman, members of 
the committee, for the opportunity to be here today to talk 
about implementation of the Clean Air Act.
    My name is Dianne Nielson. I am Governor Leavitt's 
Executive Director for Environmental Quality in the State of 
Utah, and I am appearing today on behalf of the State of Utah.
    In Utah and throughout the west, visibility and air quality 
represent essential components of western vistas, of our public 
health and environmental protection, the quality and life and 
spirit that represents the west. And we value those resources. 
We protect them through State programs in partnerships with 
States, tribes, and our Federal neighbors, through 
organizations such as the Western Governors Association and the 
Western Regional Air Partnership.
    We have learned that we can best accomplish our air quality 
and visibility goals, the objectives of the Clean Air Act and 
laws and regulations, where we have programs that foster 
innovation and flexible approaches to attainment and 
maintenance of air quality goals and standards.
    The Clean Air Act was based on the premise that we would 
have a national government that set air quality standards and 
States that develop the plans to implement those standards. Air 
quality programs traditionally have relied on command and 
control regulation for achieving those emissions reductions.
    And while these approaches have achieved significant 
environment benefit, benefit that we are all proud of and are 
served well by, the economic incentive approaches to 
regulation, such as market trading, also have a place in an 
enforcement and compliance program, and they have the potential 
to achieve greater emissions reductions while offering the 
flexibility and cost savings of program implementation.
    The Grand Canyon Visibility Transport Commission and the 
Western Regional Air Partnership have demonstrated an ability 
for States, tribes, industry, environmental representatives, 
academia, local government, the EPA, and our Federal land 
managers to be able to work together in partnership to develop 
comprehensive regional air quality programs that work and that 
serve as a model for future environmental management.
    In April 1999, EPA adopted the Regional Haze Rule. In 
September of 2000, the WRAP submitted an Annex to the report of 
the Grand Canyon Commission which detailed the sulfur dioxide 
emissions reduction milestone graph and a backstop emissions 
trading program to ensure attainment of that visibility 
improvement. On May 6 of this year, the EPA proposed a revision 
to the Regional Haze Rule that would include that Annex.
    The States who choose to implement a program under Section 
309 of the Annex and the Regional Haze Program must submit 
their plans by December 31, 2003, not much more than a year 
from now. The work of the WRAP remains on schedule and will 
enable us to meet that deadline, and we intend to do that.
    The success of this process has been in no small measure a 
result of the contributions that EPA has made to the 
partnership and the willingness of Congress to fund that work, 
and we appreciate both.
    On a related note, in a recent decision from the U.S. Court 
of Appeals regarding the Regional Haze Rule, while the court 
rejected EPA's group BART determination, or best available 
retrofit technology application, it did reaffirm the State's 
role in implementing the program. And the market-based Section 
309 program right now remains a viable option under the 
Regional Haze Rule, perhaps now with even more regulatory 
certainty.
    Congressional multipollutant proposals and President Bush's 
Clear Skies Initiative also provide opportunities for 
flexibility for market-based reductions in air pollutants.
    As this process moves forward, it is important, however, to 
remember that a new national program can best serve the west if 
it preserves the consensus on the sulfur dioxide reductions 
which are attained within the WRAP's Annex.
    And, furthermore, it should preserve the ability for States 
to require additional emissions reductions, if they need those 
to meet air quality standards, require new sources to utilize 
best-available control technology at the time they are 
constructed, and ensure that new sources do not create 
visibility impairments or other air quality related problems 
for nearby mandatory Class I areas.
    We participated in the Joint House-Senate Committee 
workshop on multipollutants, and we are prepared to continue to 
work with Congress in this effort and the administration.
    Where regulatory programs have failed, there have been some 
basic problems that have been common to those situations. First 
of all, the process of implementing innovative incentive-based 
programs is sometimes so complex that the process itself 
becomes a disincentive. While Project XL was a great idea for 
piloting innovation, the process was so complex that it wasn't 
an incentive program at all, but, in fact, a disincentive.
    The economic incentive programs that are now being 
considered offer opportunities for market-based strategies, but 
the guidance document is 200 pages long. The process is, again, 
a disincentive. Laws and regulations and policies are sometimes 
contradictory. We find that in New Source Review, with respect 
to offsets, and we find it also to some degree as we look at 
integrated planning and the need to coordinate guidelines and 
deadlines and conformity and transportation regulation.
    Furthermore, frankly, sometimes the Federal regulatory 
approvals, the process of approval, just takes too long. A non-
attainment area can qualify for redesignation after 3 years of 
conforming monitoring data. However, the process of filing the 
application and the review and approval take many years with 
very little effect or benefit and added value.
    The Clean Air Act should provide for automatic 
redesignation by operation of law if an area has 3 years of 
compliant air quality data and leaves State implementation plan 
controls in place.
    Again, thank you to the committee for taking this very 
important issue under consideration, and I would be happy to 
answer questions.
    [The prepared statement of Dianne R. Nielson follows:]
   Prepared Statement of Dianne R. Nielson, Executive Director Utah 
                  Department of Environmental Quality
    Mr. Chairman, Members of the Subcommittee, thank you for the 
opportunity to appear before you today to discuss implementation of the 
Clean Air Act. My name is Dianne Nielson, I serve as Governor Leavitt's 
Executive Director for Environmental Quality, and I am appearing today 
on behalf of the State of Utah.
    In Utah and throughout the West, visibility and air quality 
represent essential components of Western vistas, quality of life, and 
spirit. We value these resources and work to protect them through state 
programs, in partnership with state, tribal, and federal neighbors, and 
through organizations such as the Western Governors' Association 
1 and the Western Regional Air Partnership (WRAP) 
2, which Governor Leavitt co-chairs with Governor Chino of 
the Pueblo of Acoma. We have learned that we can best accomplish our 
air quality and visibility objectives if Clean Air laws, regulations, 
and program implementation foster innovative, flexible approaches to 
attainment and maintenance of air quality goals and standards. Through 
the WRAP, states and tribes have been able to improve technical program 
components, such as inventories, modeling and fire emissions, and work 
to implement initiatives such as the SO2 Annex, pollution prevention 
and renewable energy strategies, and a consensus-based recommendation 
for EPA's Sulfur In Gasoline Rule. The environmental principles of 
Enlibra 3 are being used to develop partnerships and solve 
air quality and regional haze as well as other environmental problems.
---------------------------------------------------------------------------
    \1\ For further information, see www.westgov.org
    \2\ For further information, see www.wrapair.org
    \3\ See Enlibra on www.westgov.org
---------------------------------------------------------------------------
    The work of the WRAP should serve as the model for consensus-based 
air quality initiatives and a commitment to workable regional air 
quality solutions. The Clean Air Act is based on the premise that the 
national government sets air quality standards, and states develop 
plans to meet those standards. Although state plans rely on some 
national programs (e.g., motor vehicle and fuel standards), states have 
the responsibility for developing and implementing most of the programs 
in these plans. Air quality regulations have traditionally relied on 
command and control regulations for achieving emissions reductions. 
While this approach has achieved significant environmental benefit, 
economic incentive approaches to regulation, such as market trading, 
have the potential to achieve greater emissions reductions while 
offering flexibility and cost savings. The Grand Canyon Visibility 
Transport Commission 4 and the WRAP have demonstrated the 
ability of states, tribes, industry, environmentalists, academia, local 
government, EPA, and federal land managers to work in partnership to 
develop comprehensive regional air quality programs that work and serve 
as a model for future environmental management.
---------------------------------------------------------------------------
    \4\ See also www.wrapair.org
---------------------------------------------------------------------------
    In April 1999, EPA adopted the Regional Haze Rule, including an 
option for nine Western states to implement the recommendations of the 
Grand Canyon Visibility Transport Commission, through Section 309. In 
September 2000, the WRAP submitted an Annex to the report of the 
Commission detailing a set of sulfur dioxide (SO2) emission reduction 
milestones and a backstop emissions trading program. On May 6, 2002, 
EPA proposed a revision to the Regional Haze Rule to incorporate this 
sulfur dioxide program for the West. States that choose to implement a 
309 program under the Annex must submit State Implementation Plans by 
December 31, 2003. The work of WRAP remains on schedule to enable us to 
accomplish that goal. The success of this process is in no small 
measure related to EPA's work with states and tribes to develop and 
implement WRAP initiatives and Congressional funding for the WRAP's 
work. We appreciate the commitment to the partnership.
    On a related note, the recent decision by the U.S. Court of Appeals 
for the District of Columbia Circuit 5 regarding the 
Regional Haze Rule, while rejecting EPA's ``group BART'' or Best 
Available Retrofit Technology application, did reaffirm the state's 
role in implementing the program. The market-based Section 309 program 
remains a viable option, perhaps now with even more regulatory 
certainty than a Section 308 program.
---------------------------------------------------------------------------
    \5\ American Corn Growers Association v. EPA
---------------------------------------------------------------------------
    Congressional multi-pollutant proposals and President Bush's Clear 
Skies Initiative to reduce multiple pollutants from electric utilities 
provide additional opportunity for more flexible, market-based 
reductions in air pollution. Any new national program to address 
emissions from electric utilities should preserve the Western consensus 
on sulfur dioxide reductions contained in the WRAP's Annex. 
Furthermore, any reform of current air quality laws and regulations 
should preserve the ability of states to require additional emission 
reductions if they are needed to satisfy Clean Air Act requirements, 
require new sources to utilize the best control technology available at 
the time they are constructed, and ensure that new sources do not 
create visibility or other air quality related problems at nearby 
mandatory federal Class I areas. We appreciated the opportunity to 
participate in the joint House-Senate committee workshop on multi-
pollutant legislation, and we are prepared to continue to work with 
Congress and the Administration to accomplish those goals.
    Where regulatory and incentive-based air quality programs are not 
working well, one or more of the following characteristics are common. 
EPA has worked to understand and resolve state concerns with 
implementation of the Clean Air Act. However, past conflicting laws, 
regulations, and guidance, coupled with legal positions that fail to 
accommodate the conflicts, and the cumbersome command and control 
regulatory process make progress difficult.
     The process of implementing an innovative, incentive-based 
program is so complex that it becomes a disincentive. For example, 
EPA's Project XL was a great idea for piloting innovation. However, the 
time required for the lengthy, complex application process is a 
disincentive. Likewise, Economic Incentive Programs (EIPs) provide the 
opportunity for market-based strategies. However, the guidance document 
is 200 pages long and contains so many protections that only very 
large, sophisticated state programs can afford to pursue EIPs.
     Laws, regulations and policies are contradictory. 
Emissions offsets under the New Source Review (NSR) program offer a 
timely example. Section 173 of the 1990 Clean Air Act (CAA) states that 
actual emissions are required for offsets. Yet, 40 CFR 51 provides for 
the use of allowable emissions in limited circumstances. NSR offset and 
emissions banking programs, such as Utah's 10-year old program, have 
been successful in providing real environmental results and economic 
flexibility. While EPA has not produced new guidance or rulemaking to 
address the apparent contradictions, the strict interpretation of the 
CAA by EPA's Office of General Counsel leaves established offset 
programs in disarray.
    Integrated planning requires coordinated or flexible deadlines for 
various regulatory decisions. The ability to address regional haze 
along with PM2.5 and ozone, pollutants that have the same sources and 
similar technical analyses, makes sense. Conformity of transportation 
and air quality plans is also appropriate. However, conformity 
regulations allow only 12-18 months to switch to new mobile emissions 
models. Where the models represent significant change or increased 
emissions factors, as they normally do, major revisions in 
transportation and air quality plans are also required. In those cases 
12-18 months is not enough time. Flexibility in integrated planning and 
transportation conformity deadlines would facilitate program goals.
     Federal regulatory approvals take too long. The process of 
development and approval of Maintenance Plans and Attainment 
Redesignations is too complex and lengthy. A non-attainment area can 
apply for redesignation with three years of compliant monitoring data. 
However, the process of application and administrative review and 
approval takes years, with little or no environmental benefit or added 
value. Moreover, in the interim, states are subject to costly, 
analytical and legal requirements designed for areas that have not 
attained national air quality standards. The CAA should provide for 
automatic redesignation by operation of law if an area has three years 
of compliant air quality data and leaves State Implementation Plan 
controls in place.
    In conclusion, I appreciated the Subcommittee's interest in 
implementation of the Clean Air Act, and would be willing to answer 
questions and provide additional information.

    Mr. Shimkus. I thank you for your testimony and your 
punctuality on the clock, and now would like to recognize Mr. 
Chris Jones, who is the Director of the Ohio Environmental 
Protection Agency.
    My colleagues from Ohio would like to welcome you, as I do, 
and you have 7 minutes. Your full statement is in the record.

                 STATEMENT OF CHRISTOPHER JONES

    Mr. Jones. Thank you, Mr. Chairman, and it is good to see 
good Ohio representation here on the committee.
    I appreciate the opportunity to reflect upon my experience 
as a regulator implementing the Clean Air Act, and I would like 
to begin with a simple but often overlooked observation. That 
is, the Clean Air Act has successfully produced cleaner air 
across America, much cleaner air. Perhaps nowhere is this more 
evident than in the State of Ohio.
    We are reminded that Time magazine once declared 
Steubenville, Ohio, the city with the dirtiest air in the 
Nation, little wonder since in 1975 alone Steubenville had 32 
air pollution alerts. Ohio was the first State to use emergency 
powers granted under the Clean Air Act to temporarily stop 
production at manufacturing facilities in order to alleviate a 
particularly severe air pollution episode in Steubenville.
    Given this history, I am continually amazed and dismayed by 
the public perception that the condition of the environment has 
gotten worse over the past 10, 20, or 30 years. That is far 
from the truth because of the strong Federal laws, including 
the Clean Air Act, and because of competent State 
administration of those laws.
    With regard to air quality, for example, Ohio's trend 
analysis shows over the past 20 years that carbon monoxide 
levels have reduced more than 61 percent, sulfur dioxide levels 
reduced an average of 52 percent, nitrogen oxide levels are 
down 15 percent, and ozone levels in Ohio have been reduced by 
an average of 13 percent.
    In addition, lead levels have decreased by more than 95 
percent from 1979 to 1998. From 1972 to 1987, the total 
particulate matter levels dropped by 45 percent. And 
PM10 decreased by 22 percent from 1989 to 2000. 
These successes are clear evidence that much of the Clean Air 
Act works and works well, and I would like to mention a few 
particular elements.
    The acid rain program--by all accounts, Congress' approach 
toward reducing sulfur dioxide and nitrogen oxides has been a 
success story. The reductions were achieved on schedule. There 
is widespread compliance with the standards. The cost of 
compliance is lower than expected, and the program operates 
well with a relatively small staff.
    State requirements for the 1-hour ozone standard--another 
area in which the 1990 amendments took an innovative approach 
to recognizing regional differences was the attainment 
requirements for the 1-hour ozone standard. Congress created 
various categories ranging from marginal to extreme, depending 
on the level of ozone pollution.
    The areas with higher levels of ozone had additional time 
to come into compliance, recognizing the complexity of the 
situation. With additional time came more stringent 
requirements, which were both appropriate and necessary to 
achieve eventual attainment. In the case of Ohio, we started 
with seven non-attainment areas for ozone, four moderate and 
three marginal.
    In each case, we were able to meet the 1-hour ozone 
standard by the prescribed date, except for Cincinnati where we 
were granted two 1-year extensions that are allowed under the 
Act. Today, all of Ohio's counties measure attainment with the 
1-hour ozone standard, again pointing to the overall 
improvement in air quality that resulted from the Clean Air 
Act.
    It is worth noting, however, that not all areas of the 
Nation have complied with the 1-hour standard. As U.S. EPA 
works to develop its implementation plan for the new 8-hour 
standard, the issue of a level playing field arises between 
areas that have yet to meet the old, less stringent standard, 
and those that have complied and now face additional controls.
    Since the early 1970's, there have been large reductions in 
emissions from automobiles. This continuing improvement has 
been the result of more efficient engines, emission control 
technologies, and cleaner burning fuel. And, of course, there 
have been some unintended consequences, such as the MTBE 
contamination of groundwater and localized price spikes.
    But overall the provisions of the Clean Air Act have 
combined to keep emissions from automotive sources in check, 
despite a significant increase in vehicle miles traveled. While 
these components of the Clean Air Act have resulted in 
demonstrable benefit, there are other areas proving to be 
problematic in their implementation. Unfortunately, the result 
is the provisions of the Act were well conceived in concept, 
are failing to produce the environmental gains that were 
promised.
    With respect to the Title V program, the Title V permit was 
intended to provide one document that identifies all of the air 
regulations a facility must meet. Clearly, this is a sensible 
approach that can ease compliance monitoring for regulators and 
for the regulated community. However, U.S. EPA has expanded the 
required content of the Title V permit to the point that it is 
excessively lengthy, cumbersome, and confusing, precisely the 
difficulties I believe Congress sought to avoid in mandating a 
single permit.
    One source of the problem is that Federal regulators are 
intent on assuring that all portions of the Title V permit are 
federally enforceable. While I understand the need for Federal 
enforceability of key provisions, this virtual obsession with 
duplicative oversight suggests a lack of confidence in the 
States that undermines our partnership relationship. At the 
same time, it burdens the States with excessively onerous 
permit issuance demands.
    For example, Ohio EPA recently issued a draft permit for a 
refinery that's over 600 pages long. Another permit in 
development, at last count, was 820 pages long. In addition, 
after initially instructing States to omit insignificant 
sources from Title V permits, U.S. EPA reversed course and is 
forcing States to focus resources on insignificant sources.
    Ohio facilities currently operate approximately 11,000 
larger emissions units at 760 Title V facilities. An additional 
22,000 insignificant sources are exempt by State rule from the 
Federal side of the permit, although they are subject to State 
oversight. U.S. EPA recently notified us that our rules are 
deficient and must be modified, so that these 22,000 additional 
sources may undergo additional review and scrutiny by the 
Federal Government.
    I would submit to you that that defies common sense. These 
sources are called insignificant for a reason. Yet we are 
charged with increasing the number of sources covered by the 
Federal side of the Title V permits by 200 percent. With 
virtually every State behind schedule for issuing Title V 
permits, doesn't it make more sense to move forward and 
complete the permitting process for the significant sources 
rather than slowing down the entire process by bringing in 
large numbers of sources that are, by definition, insignificant 
and are already regulated by States.
    With respect to the MACT standards, Congress set a very 
aggressive goal for U.S. EPA to issue all of the rules for air 
toxics within 10 years. We met the early deadlines, and U.S. 
EPA should be commended. However, we have fallen behind. It 
doesn't make sense to have 50 States now writing MACT standards 
for a number of sources that didn't meet the level, and we 
ought to look at that.
    Finally, with respect to redesignation, I would like to 
echo Ms. Nielson's comments. We have two counties in Ohio that 
haven't had a violation of the sulfur dioxide standard in 20 
years, and we can't get them redesignated because two companies 
in--one company in each of those counties doesn't meet the 
standard. It doesn't make sense that we can't redesignate those 
counties.
    The Clean Air Act is complicated. It is multifaceted. 
Congress can be proud of the extensive air quality benefits it 
has produced. As States, we share your interest and the 
interest of U.S. EPA in making it work. I appreciate the 
opportunity to testify.
    [The prepared statement of Christopher Jones follows:]
 Prepared Statement of Christopher Jones, Director, Ohio Environmental 
                           Protection Agency
    Mr. Chairman, members of the subcommittee, thank you for this 
opportunity to reflect upon my experience as a regulator with Clean Air 
Act implementation. I would like to begin with a simple but often 
overlooked observation: the Clean Air Act has successfully produced 
cleaner air across America. Much cleaner air. Perhaps nowhere is this 
more evident than in the State of Ohio.
    As the Ohio Environmental Protection Agency prepares to celebrate 
its 30th anniversary this October, we are reminded of our past. We are 
reminded that Time magazine declared Steubenville, Ohio, the city with 
the dirtiest air in the nation. Little wonder, since in 1975 alone, 
Steubenville had 32 air pollution alerts. These alerts were issued when 
air quality was so unhealthy that people at risk were advised to remain 
indoors. Ohio was the first state to use emergency powers granted under 
the Clean Air Act to temporarily stop production at manufacturing 
facilities in order to alleviate a particularly severe air pollution 
episode in Steubenville.
    Given this history, I am continually amazed--and dismayed--by the 
public perception that the condition of the environment has gotten 
worse over the past ten, twenty or thirty years. That is far from the 
truth, because of strong federal laws including the Clean Air Act, and 
because of competent state administration of those laws.
    With regard to air quality, for example, Ohio's trend analysis 
shows over the past 20 years:

 Carbon monoxide levels reduced more than 61 percent;
 Sulfur dioxide levels reduced an average of 52 percent;
 Nitrogen dioxide levels down 15 percent;
 Ozone levels in Ohio have been reduced by an average of 13 
        percent.
    In addition:

 Lead levels decreased by more than 95 percent during the 1979-
        1998 period.
 From 1972 to 1987, the total particulate matter levels dropped 
        by 45 percent.
 Particulates (PM10) decreased by 22 percent from 
        1989 to 2000.
    These successes are clear evidence that much of the Clean Air Act 
works and works well. I'd like to speak to particular elements of the 
Act that have been especially effective.
    Acid Rain Control Program--By all accounts, Congress' approach 
toward reducing sulfur dioxide and nitrogen oxides has been a success 
story. The reductions were achieved on schedule, there is widespread 
compliance with the standards, the cost of compliance is lower than 
expected, and the program operates well with a relatively small staff.
    The market-based trading program was innovative in its approach to 
dealing with the regional nature of many air pollution problems. Its 
success therefore provides a model that can be used in the future for 
other circumstances where there are significant reductions to be 
achieved over a wide area.
    State Requirements for One-hour Ozone--Another area in which the 
1990 Amendments to the Act took an innovative approach to recognizing 
regional differences was the attainment requirements for the one-hour 
ozone standard. Congress created various categories ranging from 
marginal to extreme, depending on the level of ozone pollution. The 
areas with higher levels of ozone had additional time to bring come 
into compliance, recognizing the complexity of the situation. With the 
additional time came more stringent requirements, which were both 
appropriate and necessary to achieve eventual attainment.
    In the case of Ohio, we started with seven nonattainment areas for 
ozone (four moderate, three marginal). In each case, we were able to 
meet the one-hour ozone standard by the prescribed date, except for 
Cincinnati where we were granted two one-year extensions that are 
allowed for under the Act. Today, all of Ohio's counties measure 
attainment with the one-hour ozone standard, again pointing to the 
overall improvements in air quality that have resulted from the Clean 
Air Act.
    It is worth noting, however, that not all areas of the nation have 
complied with the one-hour standard. As U.S. EPA works to develop its 
implementation plan for the new eight-hour standard, the issue of a 
level playing field arises, between areas that have yet to meet the 
old, less stringent standard and those that have complied and now face 
additional controls.
    Reductions in Vehicle Emissions--Since the early 1970s, there have 
been large reductions in emissions from automobiles. This continuing 
improvement has been the result of more efficient engines, emission 
control technologies, and cleaner burning fuel. Of course, there have 
been some unintended consequences such as MTBE contamination of 
groundwater and localized price spikes in areas where specially 
formulated fuels are mandated. But overall, the provisions of the Clean 
Air Act have combined to keep emissions from automotive sources in 
check despite a significant increase in vehicle miles traveled.
    While these components of the Clean Air Act have resulted in 
demonstrable environmental benefit, others are proving to be 
problematic in their implementation. Unfortunately, the result is that 
provisions of the Act that were well-conceived in concept are failing 
to produce the environmental gains they promised.
    Title V Permit Program--The Title V permit was intended to provide 
one document that identifies all the regulations a facility must meet. 
Clearly, this is a sensible approach that can ease compliance 
monitoring for regulators and for the regulated community. However, 
U.S. EPA has expanded the required content of the Title V permit to the 
point that it is excessively lengthy, cumbersome, and confusing--
precisely the difficulties I believe Congress sought to avoid in 
mandating a single permit.
    One source of the problem is that federal regulators are intent on 
assuring that all portions of the Title V permit are federally 
enforceable. While I understand the need for federal enforceability of 
key provisions, this virtual obsession with duplicative oversight 
suggests a lack of confidence in the States that undermines our 
partnership relationship at the same time that it burdens the States 
with excessively onerous permit issuance demands. For example, Ohio EPA 
recently issued a draft permit for a refinery that is over 600 pages 
long. Another permit in development was 820 pages long at last count.
    In addition, after initially instructing States to omit 
insignificant sources from Title V permits, U.S. EPA reversed course 
and is forcing States to focus resources on insignificant sources. Ohio 
facilities currently operate approximately 11,000 larger emission units 
at 760 Title V facilities. An additional 22,000 insignificant sources 
are exempt by state rule from the federal side of the Title V permit, 
although they are subject to state oversight. U.S. EPA recently 
notified us that our rules are deficient and must be modified so that 
these 22,000 additional sources may undergo additional review and 
scrutiny by the federal government.
    I submit that this defies common sense. These sources are called 
``insignificant'' for a reason. Yet we are charged with increasing the 
number of sources covered by Title V permits by 200%. With virtually 
every State behind schedule for issuing Title V permits, doesn't it 
make more sense to move forward and complete the permitting process for 
the ``significant'' sources, rather than slowing down the entire 
process by bringing in large numbers of sources that are by definition 
``insignificant?''
    This is just one example of how U.S. EPA has changed course in the 
middle of the Title V process. This lack of continuity is frustrating 
to the States and is a major contributor to our being unable to meet 
the original timeframes for permit issuance. For example, in 1995 Ohio 
received a full approval of our Title V program, which means U.S. EPA 
found our program acceptable in its entirety. Last November, some six 
years later, we were told in a letter from U.S. EPA that we must change 
our basic Title V program in seven different ways or risk losing the 
program.
    In other words, in 1995 U.S. EPA told us we have a completely 
acceptable program. Now, despite there being no change in the Clean Air 
Act, we are told that the same program is deficient. Some of the issues 
raised in the letter had never before been identified by U.S. EPA as a 
concern. Others were specifically addressed as a part of the delegation 
process. Instead of allowing us to use our resources to issue Title V 
permits under the program they themselves approved, U.S. EPA is forcing 
us to keep tinkering with the program itself.
    The Inspector General's Office of U.S. EPA has reviewed the 
workings of the Title V program and has identified several areas for 
improvement, including simplified terms and conditions. As a first 
step, these recommendations should be implemented.
    Second, the fee structure and funding for the Title V permit 
program should be reviewed and revised. Although the current $25 per 
ton adjusted to the Consumers Price Index was sufficient at the 
beginning of the program, it no longer produces sufficient revenue to 
support the program. This is in part due to the increasing 
responsibilities associated with these permits and also to the fact 
that states like Ohio are requiring additional controls, which reduce 
emissions and improve air quality but lower our fee income.
    MACT Standards--In the Clean Air Act Amendments, Congress set a 
very aggressive goal for U.S. EPA to issue all the rules for air toxics 
within ten years. U.S. EPA was able to meet earlier MACT issuance 
deadlines and should be commended for those actions. However, they have 
fallen behind on the issuance of the ``10 year'' MACT standards. Under 
112(j) of the Clean Air Act, if U.S. EPA fails to issue the MACT 
standards, then states will have the responsibility to issue them on a 
``case-by-case'' basis. This will obviously lead to an inconsistent 
program with unavoidable inequities for the regulated community, as 
well as another drain on State resources without financial 
compensation. More importantly, it subverts the intent of a having a 
national standard, and thereby makes it less likely that the full 
potential of air quality improvements envisioned by Congress will be 
achieved.
    Requirements for Redesignation--The attainment or nonattainment 
status of an area should reflect actual air quality. Ohio has not 
experienced a violation of the ambient air quality standards for sulfur 
dioxide for over twenty years, yet two counties in Ohio (Lucas and 
Cuyahoga) remain designated nonattainment. U.S. EPA procedural rules 
make it very difficult to redesignate in both these cases. In both 
counties, a single company in does not comply, so U.S. EPA will not 
redesignate. (One of those companies is litigating its compliance 
status.) The rules governing attainment designation should be eased to 
be better able to reflect actual air quality.
    The Clean Air Act is a complicated, multi-faceted piece of 
legislation. Congress can be proud of the extensive air quality 
benefits it has produced. The States share your interest--and the 
interest of U.S. EPA--in continued progress. Our suggestions for 
administrative improvements are offered in the spirit of enabling the 
Clean Air Act to achieve its full potential.
    Thank you. Mr. Chairman.
               U.S. Environmental Protection Agency
                       Region 5--Air and Radiation Division
                                                  November 21, 2001
Correspondence

(AR-18J)

Robert F. Hodanbosi, Chief
Division of Air Pollution Control
Ohio Environmental Protection Agency
122 South Front Street
P. O. Box 1049
Columbus, Ohio 43266-1049
    Dear Mr. Hodanbosi: This letter is to inform you of the action 
required by the Ohio Environmental Protection Agency (OEPA) to avoid an 
April 1, 2002, United States Environmental Protection Agency (USEPA) 
publication of a notice of program deficiency for the Ohio Title V 
operating permit program. As you know, we published a Notice of Comment 
Period on operating permit program deficiencies in the Federal Register 
on December 11, 2000. Pursuant to the settlement agreement discussed in 
that notice, USEPA will publish notices of program deficiencies for 
individual operating permit programs, based on the issues raised that 
we agree are deficiencies. In that notice, USEPA committed to 
publishing these notice of program deficiencies for fully approved 
programs, such as Ohio's program, by April 1, 2002.
    USEPA received comments concerning the Ohio's Title V program on or 
before the March 12, 2001, deadline. We have reviewed these comments 
and, based on our preliminary review, have identified the issues on 
which Ohio must have taken significant action to avoid Title V notice 
of program deficiency on April 1, 2002. These issues include;
    1. The language of Ohio Administrative Code (OAC) 3745-77-07 
(A)(3)(c)(ii) and (iii) limits the reporting of deviations to those 
which can be detected by the compliance method required by the permit, 
in violation of the Credible Evidence rule.
    2. The Title V permits exempt the reporting of the malfunctions 
under OAC 3745-15-06(B) from the six-month monitoring reports required 
by 40 C.F.R. 70.6(a)(3)(iii).
    3. The six-month monitoring reports do not require permitees to 
submit reports of all required monitoring as required by 40 C.F.R. 
70.6(a)(3)(iii).
    4. All of initial Title V permits have not been issued.
    5. Title V permits must contain monitoring, recordkeeping,and 
reporting requirements sufficient to assure compliance.
    6. Applicability of 112(r) and Title IV in the Title V permit.
    7. Identification of origin and authority of each permit term and 
condition in the Title V permit.
    8. The statements of basis must conform to the guidelines we will 
provide to you under separate cover. We enclosed a more detailed 
discussion of these issues with this letter.
    We have been working with your staff concerning these comments and 
are pleased with Ohio's intent to correct many of these potential 
deficiencies within a reasonable timeframe. We would like for you to 
provide us with confirmation of the issues that you are planning to 
resolve,along with timeframes for these resolutions, so that we will be 
better prepared to work with you to achieve your goal. Please be aware 
USEPA reserves the right established in the Act and 40 C.F.R. 70.10 to 
publish a notice of program deficiency for any or all of these 
deficiencies at a later date if Ohio fails to address these 
deficiencies adequately and expeditiously. USEPA also reserves the 
right to publish subsequent notice of program deficiencies concerning 
other deficiencies in the Ohio Title V program that were not identified 
during the comment period ending March 12, 2001.
    We look forward to continued cooperation between our offices on 
Title V program issues. If you have any questions, please contact 
Genevieve Damico or Kaushal Gupta, of my staff,at (312) 353-4761 and 
(312) 886-6803 respectively.
            Sincerely yours,
                                    Bharat Mathur, Director
                                         Air and Radiation Division
Enclosure
                                 ______
                                 
                               Enclosure
 issues concerning deficiencies in the ohio title v operating permits 
                                program
    The language of Ohio Administrative Code (OAC) 3745-77-
07(A)(3)(c)(ii) and (iii) limits the reporting of deviations to those 
which can be detected by the compliance method required by the permit.
    OAC 3745-77-07(A)(3)(c)(ii) and (iii) states:
          (ii) That each report submitted under paragraph (A)(3)(c)(i) 
        of this rule shall clearly identify any deviations from permit 
        requirements since the previous report that have been detected 
        by the compliance method required under the permit and any 
        deviations from the monitoring, recordkeeping, and reporting 
        requirements under the permit;
          (iii) That each permit shall require prompt reporting of 
        deviations from federally enforceable permit requirements that 
        have been detected by the compliance method required under the 
        permit, including deviations attributable to upset conditions 
        as defined in the permit, the probable cause of such 
        deviations, and any corrective actions or preventive measures 
        taken. Verbal reports under this paragraph shall be submitted 
        to the director as soon as practicable, consistent with 
        diligent verification and certification, but in no case later 
        than three business days after discovery of the deviation, with 
        a follow up written report within thirty days after such 
        discovery.
    The underlined portions of the language demonstrates that Ohio's 
rules do not require permittees to consider all credible evidence when 
the permittee reports deviations from the permit requirements. Ohio 
must remove this language from OAC 3745-77-07(A)(3)(c)(ii) and (iii).
    The Title V permits exempt the reporting of the malfunctions under 
OAC 3745-15-06(B) from the six-month monitoring reports required by 40 
C.F.R. 70.6(a)(3)(iii).
    Ohio's permits provide that quarterly reports satisfy the 
requirements pertaining to prompt reporting of all deviations (Part I 
A.1.c.ii). For this reason, the quarterly reports must meet the 
criteria for deviation reports. Both 40 C.F.R. 70.6(a)(3)(iii)(B) and 
OAC 3745-77-07(A)(3)(c)(iii) require permittees to report promptly 
deviations from permit requirements. Yet, Part I.A.1.c.ii of the Ohio 
Title V permits specifically exclude from the quarterly reporting 
requirement deviations resulting from malfunctions reported in 
accordance with OAC rule 3745-15-06, a part of the Ohio State 
Implementation Plan. The reporting aspects of the Ohio SIP, OAC 3745-
15-06, do not alter the Title V requirement to report all deviations, 
including malfunctions, in the Title V quarterly report. Ohio must 
revise Part I A.1.c.ii of the Title V permits to no longer exclude the 
reporting of deviations resulting from malfunctions in the quarterly 
deviation reports. OEPA may choose to require that the permittee simply 
reference the malfunction report required by OAC 3745-15-06 by 
requiring a similar report to Section D of USEPA's Part 71 six-month 
report form.
    The six-month monitoring reports do not require permitees to submit 
reports of any required monitoring as required by 40 C.F.R. 
70.6(a)(3)(iii).
    Ohio's permits provide that quarterly reports satisfy the six month 
reporting requirements (Part I A.1.c.ii). For this reason, the 
quarterly reports must meet the same criteria as the six-month reports. 
Both 40 C.F.R. 70.6(a)(3)(iii) and OAC 3745-77-07(A)(3)(c)(i) require 
that the permittee submit a report of the results of all required 
monitoring. Ohio's quarterly reports only include a compilation of the 
deviations being reported by the permittee. This does not satisfy the 
requirement to submit a report of any required monitoring. Ohio may 
choose to resolve this issue by requiring permittees to submit reports 
similar to those required by Section C of USEPA's Part 71 six-month 
report form.
    Furthermore, these same rules require that all applicable reporting 
requirements must include a semiannual (or more frequent) reporting 
requirement. The rule allows no exceptions. Therefore, all federally 
enforceable reporting requirements in a Title V permit must require at 
least semiannual submission of the reports. Some of Ohio's Title V 
permits currently require only annual submission of certain reports; 
Ohio must revise these permits to submit reports at least semiannually.
    All of the Title V permits have not been issued.
    Section 503(c) of the Clean Air Act clearly requires states to 
issue all of the original Title V permits within 3 years of program 
approval. We do understand that there are many reasons why Ohio was 
unable to complete the issuance of these permits within the required 3-
year timeframe. However, because the success of this program is 
dependant on the issuance of the Title V permits, Ohio must develop by 
March 2002 a schedule for permit issuance, including milestones, to 
ensure issuance of all outstanding initial permits no later than 
December 1, 2003. Pamela Blakley provided an example of a permit 
issuance schedule in an e-mail on November 7, 2001.
    Title V permits must contain monitoring, recordkeeping, and 
reporting requirements sufficient to assure compliance.
    A. Title V permits contain monitoring and recordkeeping conditions 
on the state-only enforceable side when those conditions should be made 
federally enforceable.
          Some Title V permits incorrectly make monitoring and 
        recordkeeping provisions enforceable only by the state when 
        those provisions are federally enforceable. Because a federal 
        rule, 40 C.F.R. 70.6(a)(3)(i)(B),requires the permit to contain 
        all monitoring and recordkeeping necessary to assure 
        compliance, such monitoring and recordkeeping must be on the 
        federally enforceable side of the permit.
          One example of this problem comes from the draft Title V 
        permit for Cleveland Electric Illuminating Avon Lake Power 
        Plant (facility ID 0247030013, issued January 30, 2000). The 
        permit requires the source to operate and maintain a 
        temperature monitor in order to measure the temperature of 
        gases entering an electrostatic precipitator. Because the 
        temperature of these inlet gases will indicate whether the 
        source is complying with federally enforceable emission limits 
        in the permit, the requirement to operate and maintain the 
        temperature monitor also is federally enforceable. However, the 
        requirement as written in the draft permit is currently 
        enforceable only by the state.
          In another example, the same permit contains a state-only 
        requirement for the source to maintain a logbook for a 
        federally required continuous monitoring system. Such a 
        requirement should be federally enforceable, even though there 
        may already be federally enforceable requirements sufficient to 
        ensure proper operation of the monitoring system. Requirements 
        that will ensure the proper operation of federally required 
        monitoring systems are part of the underlying requirements, and 
        therefore are federally enforceable.
    B. Title V permits must contain monitoring, recordkeeping, and 
reporting requirements sufficient to assure compliance with all 
applicable limits. The permitting authority must write these 
requirements in sufficient detail to allow no room for interpretation 
or ambiguity in meaning.
          According to 40 C.F.R. 70.6(c)(1), Title V permits must 
        contain monitoring, recordkeeping, and reporting requirements 
        sufficient to assure compliance with the terms and conditions 
        of the permit. These requirements must involve the best 
        compliance methods practicable, taking into consideration the 
        source's compliance history, likelihood of violating the 
        permit,and feasibility of the methods.
          Ohio's Title V permits currently rely too heavily on AP-42 
        emission factors. These emission factors were not meant to be a 
        basis of compliance with part 70. They are a last resort in 
        compliance assurance (and are not a viable option at all when 
        their reliability ratings are low). In most instances in which 
        AP-42 emission factors are used, more reliable compliance 
        methods are available.
          The permitting authority need not impose onerous compliance 
        assurance requirements, but it cannot allow sources to use 
        emission factors as an escape from monitoring, recordkeeping, 
        and reporting activities.
          In addition to implementing appropriate compliance methods, 
        the monitoring, recordkeeping, and reporting requirements must 
        be written in sufficient detail to allow no room for 
        interpretation or ambiguity in meaning. Requirements that are 
        imprecise or unclear make compliance assurance impossible.
          For example, some Title V permits require monitoring devices 
        to be ``installed, calibrated, operated, and maintained in 
        accordance with the manufacturer's specifications,'' without 
        explaining in detail the steps in these processes or the 
        manufacturer's specifications. These steps must be explained in 
        detail in order for such a requirement to have any meaning. The 
        description of plant activities need not be exhaustive, but 
        they must be specified in the permit if they would 
        significantly affect the source's ability to comply. Leaving 
        the source to follow ``manufacturer's specifications'' does not 
        help direct the source toward compliance.
          In some instances, manufacturer's specifications may not even 
        exist. Many Title V permits contain ambiguous phrases, such as 
        ``if necessary.'' For example: ``If necessary, the permittee 
        shall maintain monthly records . . .'' The phrase ``if 
        necessary'' should be removed altogether; the permit should 
        specify exactly what is necessary. In this example, the permit 
        should either precisely explain the situation that would 
        necessitate monthly records, or simply require monthly records 
        at all times. Ambiguous language hampers the source in its duty 
        to independently assure compliance, and leaves legal 
        requirements open to interpretation.
    C. Title V permits do not require the submission of an emission 
control action plan until 60 days after final issuance of the permit, 
in violation of OAC 3745-25. Although emission control action plans may 
no longer be critical due to improvements in air quality, Ohio should 
resolve the deficiency by changing the permits to comply with the rule 
or by changing the rule itself.
    Applicability of 112(r) and Title IV in the Title V permit.
    We understand from a October 16, 2001, e-mail from Tom Rigo to 
staff, that OEPA is immediately making changes to the Title V permit to 
state applicability to 112(r) and Title IV. We are appreciative of this 
effort and look forward to the timely incorporation of this language in 
the Title V permits.
    Identification of origin and authority of each permit term and 
condition in the Title V permit.
    40 C.F.R. 70.6 (a)(1)(i) requires that the Title V permit state the 
origin of and authority for each term and condition in the permit. 
Ohio's permits do list the origin and authority on an emission unit 
basis. It is clear that part 70 and the OAC envision that the origin 
and authority would be listed on a term and condition basis. For this 
reason we would like confirmation that OEPA is planning on revising the 
Title V permit format to include the origin of and authority for each 
term and condition.
    The statements of basis must conform to the guidelines we will 
provide to you under separate cover.
    40 C.F.R. 70.7(a)(5) requires that each draft permit must be 
accompanied by a statement that sets forth the legal and factual basis 
for the draft permit conditions. Although we recognize that there is 
little information available to judge the adequacy of a statement of 
basis besides this requirement, we concur with the comments made by the 
commentors alleging that Ohio's statements of basis do not meet the 
intent of part 70. We are, therefore, committing to provide OEPA with 
some guidelines that will be useful in meeting the intent of part 70. 
OEPA must follow these guidelines in preparing all future statements of 
basis to resolve this issue.
                                 ______
                                 
             Office of Inspector General--Evaluation Report
                                  AIR
           epa and state progress in issuing title v permits
                Report No. 2002-P-00008, March 29, 2002
                           Executive Summary
    To reduce violations of air pollution laws and improve the 
enforcement of those laws, Title V of the 1990 Clean Air Act (Act) 
requires that all major stationary sources of air pollutants obtain a 
permit to operate. Translating and consolidating the applicable air 
pollution requirements for major stationary sources into site-specific, 
legally enforceable permit limits is a complex, time-consuming, and 
resource intensive process. Nonetheless, in passing Title V, Congress 
provided the statutory authority, fee collection authority, and 
expectation that all Title V permits would be issued by November 1997, 
seven years after it passed the Act. However, over a decade later, only 
70 percent of the sources have been issued Title V permits.
                                purpose
    The Office of Inspector General (OIG) initiated this evaluation at 
the request of U.S. Environmental Protection Agency (EPA) Region 5 
management because they were concerned about the progress state and 
local air pollution control agencies (state and local agencies) were 
making in issuing Title V permits under the Act. In planning the 
evaluation, we expanded the scope to include other EPA regions and 
states because problems in issuing Title V permits were not isolated to 
Region 5. The objectives of our evaluation were to identify:

 Factors delaying the issuance of Title V permits by selected 
        state and local agencies, and
 Practices contributing to more timely issuance of permits by 
        selected state and local agencies.
                            results in brief
Lack of State Resources, Complex EPA Regulations, and Conflicting 
        Priorities Contributed to Permit Delays
    Nationwide, as of December 31, 2001, state and local agencies had 
issued 70 percent (13,036 of 18,709) of the required Title V permits. 
Of 112 state and local agencies approved to administer the Title V 
program, only 4 state and 17 local agencies had issued all of their 
Title V permits. In the six states we reviewed, key factors delaying 
the issuance of Title V permits included insufficient state resources, 
complex EPA regulations, and conflicting state priorities.
     Insufficient resources. Of the six state agencies 
reviewed, three had problems with resources or staffing. For example, 
the Massachusetts Department of Environmental Protection collected $1.3 
million in Title V fees in 2000, but program costs were $1.9 million 
for the year.
     Complex regulations and limited guidance. In each of the 
six state agencies reviewed, one or more permit writers reported having 
difficulty understanding and resolving questions on EPA's complex air 
toxics regulations and reported having difficulty using EPA's limited 
guidance to establish adequate site-specific monitoring requirements.
     Conflicting priorities. In addition to Title V operating 
permits, each of the state agencies also issue construction permits to 
new sources and to sources that are making significant changes to their 
operations permits that they must act on within specified time limits. 
Two agencies took deliberate action to ensure that staff were not 
forced to work on construction permits rather than Title V operating 
permits.
    As a result, many sources do not have the operating permits that 
were designed to reduce source violations, improve regulatory agency 
enforcement abilities, establish site-specific monitoring requirements, 
increase source accountability, and ensure adequate public involvement 
in the permitting process.
EPA Oversight And Technical Assistance Had Limited Impact
    EPA did not provide adequate oversight and technical assistance to 
state and local Title V programs, and did not use the sanctions 
provided in the Act to foster more timely issuance of Title V permits.
     Fee reviews of many state and local agencies not 
performed. From January 1998 to December 2001, EPA had only evaluated 
28 of 112 state and local agencies regarding how they were assessing 
and managing Title V fees. These reviews are needed to identify 
potential resource issues at state and local agencies.
     Revisions to Title V regulations not completed. While EPA 
issued regulations in 1992, due to concerns about selected provisions, 
EPA has been working to revise them since 1994. State officials 
indicated that dealing with repeated draft and proposed revisions to 
Title V regulations introduced an element of uncertainty that also 
contributed to delays in issuing Title V permits.
     Insufficient data collected. State and local agencies were 
not required to consistently provide the information EPA identified as 
being needed to adequately oversee the Title V program. EPA collected 
information from all state and local agencies on the number of permits 
issued, but did not maintain an adequate database on specific delays in 
issuing individual permits.
     Act's provisions to take action not used. Although most 
state and local programs did not issue their permits within three years 
of EPA approval, EPA has not used the Act's provisions for issuing 
notices of deficiency, sanctions, and program withdrawal when state and 
local agencies have missed the Act's deadline for issuing initial Title 
V permits.
    As a result, EPA oversight had little impact on the delays 
experienced by state and local agencies. The perspective of senior EPA 
officials is that they face a dilemma in trying to take more stringent 
actions, such as sanctions against state and local agencies, while 
adhering to agency policies to work with state and local agencies as 
partners in environmental protection to the maximum extent possible. 
Also, they believe that the Title V program has limited incentives for 
both states and industries to proactively address the existing permit 
backlog.
Management Support, Partnerships, and Site Visits Contributed to More 
        Timely Issuance of Title V Permits
    In the six states we reviewed, three practices that contributed to 
the progress that agencies made in issuing Title V operating permits 
were:

 State agency management support for the Title V program.
 State agency and industry partnering.
 Permit writer site visits to facilities.
    Each of these practices contributed to the writing and issuance of 
Title V operating permits on a more timely basis. Employing one or more 
of these practices, along with sufficient resources, contributed to 
Florida and Pennsylvania completing most of their permits before other 
states. However, EPA has not taken a leadership role in collecting and 
disseminating information on practices that show promise of helping 
agencies issue permits on a more timely basis.
                            recommendations
    We recommend that the Assistant Administrator for Air and 
Radiation:

 Require EPA regions to conduct fee protocol reviews.
 Revive agency efforts to make air toxics standards easier to 
        incorporate into Title V permits.
 Complete the revisions to the Title V regulations.
 Identify and collect information from regions, states, and 
        local agencies to adequately oversee the Title V program.
 Develop and execute a national plan for addressing 
        implementation deficiencies in Title V programs, including 
        specifying the actions EPA will take to address missed 
        milestone dates for issuing the initial permits.
 Develop a plan for identifying, collecting, and disseminating 
        promising practices on the implementation of Title V programs.
    Detailed recommendations are contained at the end of chapters 3 and 
4.
                             agency actions
    In his March 26, 2002 response to the draft report, the Assistant 
Administrator stated that while state and local agencies have made good 
progress in issuing initial Title V permits, there is still more work 
to do. He stated that many of the sources remaining to be permitted are 
the more complex facilities and that the problems identified in the 
report continue to be of concern. The Assistant Administrator agreed 
with the conclusion that more can be done to help this effort and will 
follow up, within 90 days of issuance of the final report, with an 
action plan based on the report's findings and recommendations.
    The Assistant Administrator also provided comments to several 
recommendations, which are summarized at the end of chapter 3, and some 
suggested clarifications that were incorporated into the final report.
    A major stationary source is any non-mobile source of air pollution 
that meets one or more criteria as defined in the 1990 Clean Air Act. 
The criteria for major stationary source determinations is listed in 
appendix 1.

    Mr. Shimkus. And we thank you.
    Next, we will hear from Mr. Brock Nicholson, Chief of Air 
Quality Planning for the North Carolina Department of 
Environment and Natural Resources. Thank you for joining us, 
sir, and you are recognized for 7 minutes.

                  STATEMENT OF BROCK NICHOLSON

    Mr. Nicholson. Good afternoon, Mr. Chairman, and members of 
the subcommittee. I am Brock Nicholson. Today I will--I am 
going to talk about what I think is right with the current 
system and then discuss some of our concerns and suggestions 
for improvement.
    I do want to first start out by saying that Mr. Williams, 
to my left here, will talk about a number of items as a 
representative of STAPPA/ALAPCO. And as also a member of 
STAPPA/ALAPCO, we certainly endorse those comments that he will 
make.
    What is right with the current system? I think clearly the 
current Clean Air Act is a conceptually sound approach. We 
don't think it is fundamentally broken. Under this system, the 
EPA sets the national goals for protecting public health and 
welfare. States have the primary responsibility for program 
development and implementation.
    This program is a reasonable compromise between the Federal 
Government setting straight national technology standards, I 
will say as the only approach, and each State operating 
independently of a national system, perhaps as it was prior to 
the 1970 amendments.
    Currently, the National Air Program complements State 
programs and areas where it makes sense to have nationwide 
standards--fuels, mobile sources, major stationary emission 
sources.
    I will summarize a little bit what I have below here and 
just say that this approach, an air quality management approach 
as opposed to a straight technology approach, carries with it, 
though, a burden of extra complexity and cumbersomeness in 
terms of approval, some of the things that you have just heard 
about, and I think because of that does cause us problems in 
the implementation. It is resource-intensive, and so forth.
    All in all, though, it is a good approach. If, however, we 
had a straight technology approach that all parties could buy 
into, that might be a reasonable alternative. But in practice, 
what has evolved as the preferred approach is this air quality 
management approach where we do modeling, we determine what is 
necessary to attain. But this approach needs to be supplemented 
with doses of prescribed technology, and what I mean by this is 
strong national measures.
    There are some concerns, however, and I will just touch on 
it a little bit in the interest of time, where the Act is 
perhaps too cumbersome, time-consuming, resource-intensive, and 
perhaps inflexible in terms of implementing it in an efficient 
and cost-effective way, and perhaps, I should say, expeditious 
manner.
    One of these that I will give as an example of maybe 
questionable technological requirements or technical 
requirements or technical soundness is that of designations of 
non-attainment areas. I think we must find a better way to 
handle designations. States need more flexibility in meeting 
designation and planning requirements.
    First, the non-attainment label is very much disliked by 
local officials, because of impacts on economic development and 
the tag that it gives to the area.
    Second, designations are often applied across large areas 
in ways that make little sense. A common mind-set is that non-
attainment areas must be very large to catch all possible 
contributing sources and to deal with pollution transport. 
However, the authority to control sources need not apply only 
in non-attainment areas. A better approach might be the area 
of--concept of areas of violation, AOVs, and areas of 
influence, or AOIs.
    Under the approach, the AOI is the primary area of sources 
impacting the violating area, but controls are not limited to 
just this area. The AOV might then be sized in a manner that 
best balances the need to advise the public of the public 
health issue of standards violation and the impacts of 
designating an area.
    In addition, the transport of pollutants across States or 
regions could be better addressed by other means, including 
stringent national standards on sources contributing to the 
broad problem across the region or the country. However, I will 
say that EPA has generally discouraged the development of this 
AOV/AOI concept.
    Another key concern is the need for consistent national 
emissions control standards that achieve reductions based on 
state-of-art technologies. To be of most value to the States, 
the rule adoption process must be as short as possible, 
certainly shorter than we have been seeing. Emission source 
categories that are appropriate for national rules include: 
major stationary sources, light- and heavy-duty on-road 
vehicles, including diesel retrofits, off-road engines and 
equipment, both large and small, and MACT sources.
    States also need flexibility to go beyond Federal 
requirements or act sooner. An example is the North Carolina 
Clean Smokestacks Bill that you heard a reference to earlier, 
to address multiple pollutants from coal-fired powerplants. 
North Carolina believes it is vital to move ahead now with this 
initiative to protect public health, especially from fine 
particles and ozone.
    Given the uncertainty of EPA and Congressional initiatives, 
North Carolina and other States are taking similar actions 
providing leadership and impetus for action at the Federal 
level. The Clean Air Act should provide encouragement and 
credits for States that take such initiatives. States clearly 
need strong support from Federal emissions control standards in 
order to achieve significant progress in meeting air quality 
goals.
    EPA recently has provided the States with some significant 
measures in national rules for on-road, heavy-duty diesel truck 
engines. This rule, as well as the 2004 light-duty gasoline 
standard, or Tier 2 standard with low sulfur, will achieve 
reductions that individual States could not otherwise realize. 
And I might add if these reductions aren't realized through 
stringent national rules, these are opportunities lost that the 
States can never make up in their strategies to deal with non-
attainment.
    While North Carolina and some of our surrounding States 
will benefit greatly from our Clean Smokestacks Bill, we still 
need the benefits of these reductions across all States.
    Another example is the Southern Appalachian Mountains 
Initiative, which is recently or currently coming to 
conclusion. It made some significant policy recommendations 
regarding controls to reduce ozone, acid deposition, and haze 
in our region. The SAMI study concludes each SAMI State would 
receive the most benefit from reductions of emissions from 
within their own State boundaries.
    However, the air quality-related problems being encountered 
by SAMI's Class I areas would not be resolved by only 
controlled emissions from within SAMI States; hence, again, the 
need for national programs.
    The eight SAMI States with the general support of other 
stakeholders have specifically recommended the State--and I 
quote, ``The SAMI States support and will promote strong 
national multipollutant legislation for electric utility plants 
to ensure significant sulfur dioxide and nitrogen oxide 
reductions both inside and outside the SAMI region.'' The 
national multipollutant legislation should result in no less 
than the reductions for sulfur dioxide and nitrogen oxides 
represented by the administration's Clear Skies Initiative.
    Reductions from other source categories should also be 
considered in national legislation, and such legislation should 
contain sufficient measures to protect Class I areas. Should 
national legislation fail to materialize, the States that 
participated in SAMI will work together to consider regulatory 
alternatives and to encourage non-SAMI States to participate. 
Leadership by States ahead of national legislation is 
encouraged.
    And, in summary, I will also mention that four Governors--
North Carolina, South Carolina, Georgia, and Tennessee--signed 
an agreement a year ago called the Southern Air Principles, and 
in this they charged the State environmental commissioners to 
come up with a multipollutant strategy for this region, 
innovative energy and innovative transportation initiatives.
    The recommendation specifically given our Governor, who 
hosted the recent summit, was to support and promote strong 
multipollutant legislation for electric utility plants to 
ensure significant reductions of sulfur dioxide and nitrogen 
oxides and mercury, both in and outside of the Southern Air 
Principles States. Such State initiatives, when allowed, 
encouraged, and given proper credit, can provide significant 
air quality benefit and set precedents for national action.
    So, in conclusion, the basic framework of the Clean Air Act 
is sound, even though one might want to consider we want to say 
on the air quality management approach, or the more technology 
approach, we need the technology approach in addition. However, 
we suggest the following improvements.
    States need more flexibility to implement, act quicker, or 
go beyond Federal requirements. Flexibility should not be used 
as an excuse to do less. States need strong national 
regulations to provide a foundation for the State plans and the 
local specific initiatives to take care of air quality at the 
local level, and national regulations must not be the lowest 
common denominator.
    Thank you for this opportunity to participate in this area.
    [The prepared statement of Brock Nicholson follows:]
 Prepared Statement of Brock Nicholson, Chief of Air Quality Planning, 
     North Carolina Department of Environment and Natural Resources
    Good afternoon, Mr. Chairman and members of the Subcommittee. I am 
Brock Nicholson, Chief of Air Quality Planning in North Carolina's 
Department of Environment and Natural Resources. I am testifying today 
regarding the development and implementation of state air quality 
programs to meet requirements of the Clean Air Act. Today, I am going 
to talk about what I think is right with the current system, and then 
discuss some of our concerns and suggestions for improvements.
What is Right with the Current System
    The current Clean Air Act is a conceptually sound approach. It is 
not fundamentally broken. Under this system, the EPA sets the national 
goals for protecting public health and welfare. States have the primary 
responsibility for program development and implementation. This 
approach is a reasonable compromise between the federal government 
setting straight national technology requirements and each state 
operating independently of a national system. Currently, the national 
air program complements state programs in areas where it makes sense to 
have nationwide standards--fuels, mobile sources, and major stationary 
emissions sources.
    The current system, sometimes called air quality management 
approach, demands a high level of local, state and federal resources to 
operate properly. However, it is generally a good way to ensure each 
state problem is dealt with adequately without excessive compliance 
costs.
    An alternative approach, in the extreme, would be a straight 
technology prescription by the EPA with a one-size-fits-all 
requirements for all sources categories. This approach would not rely 
on computer modeling to limit controls to only those sources shown to 
be critical for attaining the ambient standards.
    There are some days when would like the straight technology 
approach to avoid the lengthy and resource-intensive modeling 
demonstrations. In the midst of lengthy arguments over modeling 
assumptions with various stakeholders, we often think: ``Let's just 
have everyone must put on controls without doing the modeling. If 
later, more controls are needed to meet the ambient standards, we will 
prescribe more.'' Then, we are quickly jerked back to the reality of 
designing a strategy that will meet the ambient standards in the most 
cost-effective manner. This is the surgical ``air quality management'' 
approach versus the ``shotgun'' technology approach.
    In practice, what has evolved as the preferred approach is the air 
quality management concept supplemented with doses of prescribed 
technology. This is a good balance for all stakeholders.
Concerns and Suggestions Regarding the Current System
    The current system has aspects that are too cumbersome, time-
consuming, resource-intensive and sometimes inflexible for the states 
to develop a program, or State Implementation Plan (SIP), in a manner 
that is best suited for that area. In other cases, we believe the 
requirements may not be technically sound. For example, the 
designations of non-attainment areas need to better set the stage for 
development of state air plans.
    We must find a better way to handle designations. States need more 
flexibility in meeting designation and planning requirements. First, 
the ``non-attainment'' label is very much disliked by local officials 
because of impacts on economic development. Second, designations are 
often applied across large areas in ways that make little sense. The 
mindset is that non-attainment areas must be very large to catch all 
possible contributing sources and to deal with pollution transport. 
Also, the authority to control sources need not apply only in non-
attainment areas. A better approach might be the concept of Areas of 
Violation (AOV)/Areas of Influence (AOI). Under this approach, the AOI 
is the primary area of sources impacting the violating area, but 
controls are not limited to AOI. The AOV might then be sized in a 
manner that best balances the need to advise the public of a standard 
violation area and the impacts of designating an area. In addition, the 
transport of pollutants across states or regions could be addressed by 
other means, including stringent national standards on sources 
contributing to the problem. However, the EPA has discouraged the 
development of the AOV/AOI concept.
    Another key concern is the need for consistent national emissions 
control standards that achieve reductions based on state-of-the-art 
technologies. To be of most value to the states, the rule adoption 
process should be as short as possible. Emission source categories that 
are appropriate for national rules include:

 Major stationary sources
 Light and heavy-duty on-road vehicles, including diesel 
        retrofits
 Off-road engines and equipment, both large and small
 MACT sources.
    States also need flexibility to go beyond federal requirements or 
act sooner. An example is the North Carolina ``Clean Smokestacks Bill'' 
to address multiple pollutants from coal-fired power plants. North 
Carolina believes it is vital to move ahead now with this initiative to 
protect public health, especially from fine particles. Given the 
uncertainty of EPA and Congressional initiatives, North Carolina and 
other states are taking similar actions providing leadership and 
impetus for action at the federal level. The Clean Air Act should 
provide encouragement and credit for states that take such initiatives. 
States clearly need strong support from federal emissions control 
standards in order to achieve significant progress in meeting their air 
quality goals. EPA recently has provided the states with some 
significant measures in national rules for on-road, heavy-duty diesel 
engines. The reductions from this rule, as well as the 2004 light-duty 
gasoline with low-sulfur gasoline standard, will achieve reductions 
that individual states could not otherwise realize. While North 
Carolina and some of our surrounding states will benefit greatly from 
our Clean Smokestacks Bill, we still need the benefits of these 
reductions across all states.
    As another example the Southern Appalachian Mountains Initiative 
(SAMI) has recently made some significant policy recommendations 
regarding controls to reduce ozone, acid deposition and haze in our 
region. The SAMI study concludes: ``Each SAMI state would receive the 
most benefit from reductions of emissions from within their own state 
boundaries. However, the air quality related problems being encountered 
by SAMI's Class I areas would not be resolved by only controlling 
emission within the SAMI states.''
    The eight SAMI states, with the consensus of other stakeholders, 
have specifically recommended: ``The SAMI states support and will 
promote strong national multi-pollutant legislation for electric 
utility plants to assure significant sulfur dioxide and nitrogen oxides 
reductions both in and outside the SAMI region. This national multi-
pollutant legislation should result in no less than the reductions for 
sulfur dioxide and for nitrogen oxides represented by the 
Administration's Clear Skies Initiative. Reductions from other source 
categories should also be considered in national legislation, and such 
legislation should contain sufficient measures to protect Class I 
areas. Should national legislation fail to materialize, the states that 
participated in SAMI will work together to consider regulatory 
alternatives and to encourage non-SAMI states to participate. 
Leadership by states ahead of national legislation is encouraged.''
    In addition to the SAMI effort, the Governors of North Carolina, 
Tennessee, Georgia and South Carolina agreed to a set of ``Southern Air 
Principles,'' which recommend multi-pollutant controls for coal-fired 
power plants and innovative energy and transportation programs that 
benefit air quality. These recommendations were released at the 
Governors' Summit on Air Quality hosted by North Carolina Governor Mike 
Easley on May 10, 2002. The specific recommendation on utility plants 
is to: Support and promote strong multi-pollutant legislation for 
electric utility plants to assure significant reductions of sulfur 
dioxide, nitrogen oxides and mercury both in and outside of the 
Southern Air Principles states. Such state initiatives--when allowed, 
encouraged and given proper credit--can provide significant air quality 
benefit and set precedents for national action.
Conclusions
    In summary, the basic framework of Clean Air Act is sound. However, 
we suggest the following improvements:

 States need more flexibility to implement, act quicker or go 
        beyond federal requirements. However, this flexibility should 
        not be used as an excuse to do less.
 States need strong national regulations to provide a 
        foundation for state plans.
 National regulations must not be the ``lowest-common 
        denominator.''
    Thank you for this opportunity to participate in this hearing.

    Mr. Shimkus. Thank you.
    Next, Mr. Art Williams, Director of the Jefferson County 
Air Pollution Control District, on behalf of STAPPA/ALAPCO. I 
yield 7 minutes.

                 STATEMENT OF ARTHUR L. WILLIAMS

    Mr. Williams. Thank you, Mr. Chairman. Good afternoon, Mr. 
Chairman, members of the subcommittee. I am Art Williams, 
Director of the Jefferson County Air Pollution Control 
District, and today I am testifying on behalf of the State and 
Territorial Air Pollution Program Administrators and the 
Association of Local Air Pollution Control Officials. Perhaps 
we have the longest acronym at the table. I current serve as 
immediate past president of that organization.
    STAPPA and ALAPCO are national associations of air quality 
officials in 54 States and territories in over 165 major 
metropolitan areas across the country. We are pleased to have 
this opportunity to provide our perspectives regarding 
implementation of the Clean Air Act.
    Notwithstanding the impressive progress associated with 
implementation of the 1990 Clean Air Act, progress that 
Federal, State, and local governments have achieved together, 
our Nation continues to face air quality and public health 
challenges of substantial proportions. I would like to touch on 
several of the key challenges that remain and a few areas where 
enhancements can be made.
    Perhaps the most complex air quality problem we face is 
achievement and maintenance of the health-based national 
standards for particulate matter and ozone. Fine particulate 
matter, or PM2.5, poses the greatest health risk of 
any air pollutant resulting in as many as 30,000 premature 
deaths each year and a variety of adverse health impacts.
    Based on preliminary air quality monitoring data, it 
appears that PM2.5 concentrations in 250 U.S. 
counties located primarily in the east and in California exceed 
this health-based standard. Attainment of the ozone standard 
also poses significant challenges. Current data show that more 
than 300 counties measure exceedances of the 8-hour ozone 
standard.
    Now that the courts have cleared the way for EPA, States, 
and localities to move forward, it is essential that EPA take 
swift action to establish implementation strategies for 
PM2.5 and 8-hour ozone. Further, STAPPA and ALAPCO 
urge timely and effective control programs for sources that 
contribute significantly to these air quality problems, 
including powerplants and non-road heavy-duty diesels.
    The magnitude of emissions from powerplants and the serious 
public health and welfare implications these emissions have 
make controlling electric utilities a top priority. 
Fortunately, there are tremendous opportunities for doing so in 
a very cost-effective manner.
    Among the most important steps Congress can take to address 
air pollution is to establish a comprehensive national 
multipollutant approach for cleaning up outdated powerplants 
and ensuring that new plants are dramatically cleaner.
    STAPPA and ALAPCO endorse the concept of a comprehensive 
strategy for reducing emissions from electric utilities and, to 
that end, recently adopted a set of principles upon which we 
believe a viable multipollutant approach should be based. Our 
associations believe that such an approach should address all 
significant emissions from electric power generation, establish 
stringent emission reduction goals reflecting the best-
available control technology, set expeditious deadlines, 
supplement, not supplant, provisions of the existing Clean Air 
Act, encourage energy efficiency, and provide flexibility to 
industry, including trading. More detail is provided in my 
written statement.
    With respect to the regulation of mobile sources and their 
fuels, we have achieved great progress over the past decade. 
Perhaps most laudable are two landmark rulemakings issued by 
EPA in recent years, including the Tier 2 motor vehicle 
emission standards and low-sulfur gasoline programs, and the 
2007 heavy-duty diesel engine and fuel rule.
    Our top remaining mobile source priority is the rigorous 
control of emissions from non-road, heavy-duty diesel engines, 
including construction, industrial, and agricultural equipment. 
STAPPA and ALAPCO urge that non-road, heavy-duty diesel engines 
and their fuels be subject to Federal standards equivalent to 
those for on-road, heavy-duty diesels and in the same 
timeframes.
    My written testimony includes STAPPA and ALAPCO specific 
recommendations in this regard. The serious and pervasive 
public health threat posed nationwide by emissions of hazardous 
air pollutants, or HAPs, is another continuing concern of our 
associations. According to EPA, more than 200 million people in 
the United States live in areas where the lifetime cancer risk 
from exposure to HAPs exceeds 1 in 100,000. Moreover, 
approximately 3 million people face a lifetime cancer risk of 1 
in 10,000.
    One of the primary sources of HAPs is motor vehicles, 
including cars and trucks. Unfortunately, EPA's action relative 
to the Clean Air Act's requirement to regulate mobile sources' 
air toxics is deficient. We believe far more is necessary at 
the Federal level to adequately address this critical public 
health threat.
    With respect to industrial sources of hazardous air 
pollution, the Clean Air Act called for EPA to establish 
technology-based standards for a large number of source 
categories by November 2000. Regrettably, EPA did not fulfill 
its obligation. Accordingly, State and local air pollution 
control agencies may be obligated to establish these standards 
on a case-by-case basis for all source categories for which EPA 
has not set these standards.
    Moreover, each day that these sources remain uncontrolled, 
many millions of people continue to be exposed to hazardous 
pollutants. EPA must do everything in its power to establish 
these standards as quickly as possible.
    The Clean Air Act's NSR program, New Source Review, is a 
fundamental component of our Nation's clean air program. 
However, we believe that this program can be improved. In 
short, STAPPA/ALAPCO support reform, not replacement, of the 
existing NSR program with two provisos. First, such reforms 
must be limited to major modifications and not extended to new 
sources. And, second, under no circumstances should reforms 
result in any less protection of the environment than is 
derived under the current program.
    One final issue on which I would like to touch is Federal 
funding for State and local air pollution agencies. The 
magnitude of our air quality problem and the associated health 
effects make it clear that funding for the control of air 
pollution should be a top priority. Unfortunately, the reality 
is that State and local air agencies are underfunded.
    STAPPA and ALAPCO, in cooperation with EPA, conducted a 
study of air program funding and estimated that Federal grants 
to State and local air pollution control agencies, under 
Section 105 of the Clean Air Act, fell short of our needs by 
$100 million a year. While we have received modest funding 
increases in recent years, these increases are not enough.
    Unless our programs receive a substantially greater boost 
in funding, we will continue to face a serious financial 
shortfall, which will adversely affect our ability to protect 
and improve air quality.
    Once again, I thank you for this opportunity to provide 
STAPPA/ALAPCO's perspectives on the implementation of the Clean 
Air Act.
    [The prepared statement of Arthur L. Williams follows:]
   Prepared Statement of Arthur L. Williams, Director, Air Pollution 
 Control District of Jefferson County, Kentucky on Behalf of the State 
     and Territorial Air Pollution Program Administrators and the 
          Association of Local Air Pollution Control Officials
    Good afternoon, Mr. Chairman and members of the Subcommittee. I am 
Arthur Williams, Director of the Air Pollution Control District of 
Jefferson County, Kentucky. I am testifying today on behalf of STAPPA--
the State and Territorial Air Pollution Program Administrators--and 
ALAPCO--the Association of Local Air Pollution Control Officials, of 
which I currently serve as Immediate Past President. STAPPA and ALAPCO 
are the national associations of air quality officials in 54 states and 
territories and over 165 major metropolitan areas across the country. 
The members of STAPPA and ALAPCO have primary responsibility under the 
Clean Air Act for implementing our nation's air pollution control laws 
and regulations and, moreover, for achieving and sustaining clean, 
healthful air for our citizens. Accordingly, we are pleased to have 
this opportunity to provide our perspectives regarding implementation 
of the Clean Air Act.
    On November 15, 1990, when President Bush signed into law the Clean 
Air Act Amendments of 1990, he put in place a precedent-setting statute 
that completely revamped our nation's approach to improving air quality 
and declared it a ``true red-letter day for all Americans.'' At the 
time, STAPPA and ALAPCO endorsed the statute as an earnest commitment 
to environmental protection and believed that the comprehensive air 
pollution control strategy established in the Act provided state and 
local regulators with the tools we needed to make meaningful strides 
toward achieving our clean air goals. Eleven and a half years later, 
our associations believe our assessment was accurate and that the Act 
has served as the firm foundation for many success stories over the 
past decade.
    Prior to the 1990 amendments, our country spent decades struggling 
with a ubiquitous, perilous and seemingly unrelenting air pollution 
problem. About 100 areas across the country, home to about 130 million 
people, exceeded the national health-based standard for ozone; over 40 
areas, with a combined population of over 55 million, violated the 
standard for carbon monoxide; 85 areas, in which 25 million people 
resided, violated the coarse particulate matter (PM10) 
standard; billions of pounds of toxic chemicals were emitted into our 
air every year; millions of tons of sulfur dioxide (SO2) 
emissions contributed to acid rain; and our production of ozone-
depleting substances was leading us directly toward devastating damage 
to our stratospheric ozone layer.
    Clearly, we were in need of a fresh start and a clear direction and 
we got them. The 1990 amendments homed in on the crux of our air 
pollution problems and framed a comprehensive strategy for attaining 
the health-based National Ambient Air Quality Standards (NAAQS), 
cleaning up mobile sources and their fuels, decreasing toxic air 
pollution, reducing acid rain and protecting the stratospheric ozone 
layer. As a result, Americans today are breathing cleaner air and 
reaping the benefits of a cleaner environment.
    More than two-thirds of the cities that in 1990 violated health-
based national standards for at least one of the six criteria 
pollutants now comply with those standards; about 1.5 million tons of 
industrial toxic air pollutants are expected to be eliminated annually 
due to rules issued since 1990; rainfall in the eastern United States 
is 25 percent less acidic, due to reductions in SO2 
emissions on the order of 6.7 million tons per year; and we have 
stopped production in the U.S. of the most harmful ozone-depleting 
substances. What is more, we have achieved these milestones while, at 
the same time, experiencing strong economic growth. In fact, since 
1970, when the first Clean Air Act was enacted, Gross Domestic Product 
has increased by 158 percent, vehicle miles traveled by 143 percent, 
energy consumption by 45 percent and U.S. population by 36 percent. 
Further, it is estimated that by 2010, implementation of the Clean Air 
Act will prevent 23,000 incidences of premature mortality, 67,000 cases 
of acute and chronic bronchitis, 1.7 million asthma attacks, 4.1 
million lost work days and 31 million days on which activity is 
restricted.
    Notwithstanding this impressive progress associated with 
implementation of the Clean Air Act--progress that federal, state and 
local governments have achieved together--our nation continues to face 
air quality and public health challenges of substantial proportions. In 
addition, while we continue to maintain that the Clean Air Act, in 
general, offers a solid and viable framework for our efforts, the 
benefit of almost 12 years of hindsight allows us to pinpoint those 
aspects of the statute and the national clean air program that we 
believe can be improved or augmented. I would like to elaborate on 
several of the key challenges that remain and a few areas where 
enhancements can be made.
Fine Particulate Matter and Eight-Hour Ozone Standards
    Perhaps the most complex air quality problem we face is achievement 
and maintenance of the health-based NAAQS for particulate matter and 
ozone.
    In 1997, EPA established a new standard for fine particulate matter 
(PM2.5). Although we are still working to complete the data-
gathering efforts necessary to determine which areas of the country 
violate the PM2.5 standard, one thing is very clear: 
PM2.5 poses the greatest health risk of any air pollutant, 
resulting in as many as 30,000 premature deaths each year. 
Additionally, fine particles are responsible for a variety of adverse 
health impacts, including aggravation of existing respiratory and 
cardiovascular disease, damage to lung tissue, impaired breathing and 
respiratory symptoms, irregular heart beat, heart attacks and lung 
cancer.
    Fine particles are not only emitted into the atmosphere directly 
from combustion processes, they are also formed secondarily in the 
atmosphere from such precursor emissions as oxides of nitrogen 
(NOX), SO2 and ammonia; in addition to their 
adverse health consequences, fine particles also contribute to regional 
haze. Based on preliminary air quality monitoring data, it appears that 
PM2.5 concentrations in 250 counties in the U.S.--located 
primarily in the East and in California--exceed the health-based 
standard.
    Overall, progress in attaining clean air has been slowest with 
respect to ground-level ozone. In the southern and north central 
regions of the U.S., ozone levels have actually increased in the past 
10 years, and in 29 national parks, ozone levels have risen by more 
than 4 percent. A significant factor in this trend is the increase we 
have experienced in NOX emissions, which are not only a 
precursor to ozone, but also a contributor to such public health and 
welfare threats as acid rain, eutrophication of water bodies, regional 
haze and, as I just mentioned, secondary PM2.5. Over the 
past 30 years or so, NOX emissions have increased by almost 
20 percent, largely due to emissions from nonroad engines and power 
plants. Current data show that more than 300 counties measure 
exceedances of the eight-hour ozone standard.
    In 1997, EPA revised the health-based standard for ozone by 
establishing an eight-hour standard, representing greater protection of 
public health. Litigation over both the new PM2.5 standard 
and the revised ozone standard has delayed their implementation; 
however, the courts have now cleared the way for EPA, states and 
localities to move forward. Not only do STAPPA and ALAPCO urge swift 
action by EPA in establishing implementation strategies for 
PM2.5 and eight-hour ozone, we also urge timely and 
effective control programs for sources that contribute significantly to 
these air quality problems, including power plants and nonroad heavy-
duty diesels.
Power Plants
    Electric utilities are one of the most significant sources of 
harmful air emissions in the U.S., responsible for 64 percent of annual 
SO2 emissions, which contribute to acid rain and the 
formation of PM2.5, and 26 percent of NOX 
emissions.
    In addition, electric utilities are responsible for 37 percent of 
U.S. carbon dioxide emissions and emit upwards of 67 hazardous air 
pollutants (HAPs)--including nickel, arsenic and dioxins--in 
substantial quantities. In fact, power plants are the major emitter of 
hydrochloric acid, which is the HAP emitted in the greatest quantity in 
the U.S, and are also responsible for more than one-third of 
anthropogenic mercury emissions. The persistent and bioaccumulative 
nature of mercury makes it of particular concern relative to aquatic 
ecosystems, where it can contaminate aquatic life and pose a serious 
threat to humans who consume the contaminated species. Based on just 
such a threat, over 40 U.S. states and territories have issued fish 
consumption advisories for mercury for some or all water bodies in 
their jurisdictions.
    The magnitude of emissions from power plants, and the serious 
public health and welfare implications these emissions have, make 
controlling electric utilities a top priority. Fortunately, there are 
tremendous opportunities for doing so in a very cost-effective manner. 
Our nation's electricity generation infrastructure is aged, comprised 
of many 30-, 40- and 50-year-old plants that continue to operate 
without modern pollution control technology. Among the most important 
steps Congress can take to address air pollution is to establish a 
comprehensive national multi-pollutant approach for cleaning up 
outdated power plants and ensuring that new plants are dramatically 
cleaner.
    STAPPA and ALAPCO endorse the concept of a comprehensive strategy 
for reducing emissions from electric utilities and, to that end, 
recently adopted a set of principles upon which we believe a viable 
multi-pollutant approach should be based. Our associations believe that 
such an approach should address all significant emissions from electric 
power generation and, if properly structured, can increase and 
accelerate protection of public health and the environment, reduce 
pollution more cost-effectively than incremental approaches and offer 
greater certainty to both industry and regulators.
    In our principles, STAPPA and ALAPCO call for an integrated 
approach based on an expeditious schedule that allows us to reduce 
emissions as rapidly as we can. Such an approach--which should 
supplement, and not supplant, provisions of the existing Clean Air 
Act--should include deadlines that are synchronized with other clean 
air programs. To ensure steady progress toward the final compliance 
deadline, interim deadlines should be established, with the first 
interim compliance requirements taking effect quickly.
    A viable multi-pollutant approach will also establish the most 
stringent enforceable national emission reduction goals feasible by 
capping emissions at levels that reflect the installation of technology 
no less stringent than best available controls on all existing units 
nationwide, with existing power plants required to meet a minimum level 
of control by the final compliance deadline.
    STAPPA and ALAPCO also believe that in meeting these emission 
goals, the regulated community should be afforded flexibility, 
including an emissions trading mechanism with appropriate limitations 
and protections against any adverse health or environmental impacts. If 
emissions allowances are required under a multi-pollutant approach, 
then they should be allocated equitably, and provisions for allocating 
to new sources should be established. Further, sources should be 
encouraged to reduce emissions as soon as possible and, to the extent 
early reduction credits are provided for, the use of such credits 
should be appropriately limited.
    On the matter of New Source Review (NSR), STAPPA and ALAPCO believe 
firmly that power plants--both new and existing--must continue to be 
subject to NSR requirements. Although I will elaborate on STAPPA and 
ALAPCO's perspectives on NSR and NSR reforms, in general, later in my 
testimony, I would like to offer the following regarding our views with 
respect to NSR for power plants.
    Current NSR requirements for new sources should remain intact, 
including, among others, those related to the installation of control 
technology (i.e., the Lowest Achievable Emission Rate in nonattainment 
areas and Best Available Control Technology in attainment areas), the 
acquisition of offsets in nonattainment areas and the protection of air 
quality increments to guard against adverse local air quality impacts 
in attainment areas. Further, while certain NSR reforms for existing 
sources are definitely in order, such sources making major 
modifications to existing units should be required to install the best 
available controls on affected units at the time of the modification, 
acquire any emissions allowances required to address emission increases 
and ensure against adverse local health or environmental impacts.
    In addition, a multi-pollutant approach to reducing emissions from 
power generation should strongly encourage the most efficient use of 
any fuel used as input to electric generation or process energy 
sources, as well as energy efficiency, energy conservation and 
renewable electric energy. Further, it should support efforts to 
develop and deploy consistent approaches for distributed resources to 
mitigate the impacts of small units not otherwise covered by a national 
multi-pollutant strategy.
    Finally, a viable multi-pollutant strategy will ensure that 
regions, states and localities retain their authority to adopt and/or 
implement measures--including local offset requirements--that are more 
stringent than those of the federal government.
    As our nation approaches the issue of a multi-pollutant strategy 
for one of our most significant sources of air emissions, we must do so 
in a way that institutes an appropriately rigorous emissions reduction 
scheme on a timely schedule and compels the use of state-of-the-art 
technology, commensurate not only with the substantial contribution of 
power plants to our nation's continuing air quality and public health 
challenges, but also with the level of reductions we will garner from 
new regulatory programs addressing other big-emitting sources, like 
passenger cars and heavy-duty diesel engines.
Nonroad Heavy-Duty Diesel Engine and Fuels
    With respect to the regulation of mobile sources and their fuels, 
we have achieved great progress over the past decade. Perhaps most 
laudable are two landmark rulemakings issued by EPA in recent years. In 
December of 1999, the agency promulgated Tier 2 motor vehicle emission 
standards and a national low-sulfur gasoline program. The following 
December, the agency issued a rule (the 2007 Diesel Rule) establishing 
tighter engine standards for onroad heavy-duty diesels, such as big 
diesel trucks, and a commensurately stringent cap on sulfur in onroad 
diesel fuel.
    Notwithstanding these truly remarkable accomplishments that will 
yield tremendous public health and environmental benefit across the 
entire country, we still have more work to do in reducing emissions 
from mobile sources and fuels. First and foremost in this regard is the 
rigorous control of emissions from the last really big mobile source 
category remaining: nonroad heavy-duty diesel engines (HDDEs), 
including construction (e.g., bulldozers and excavators), industrial 
(e.g., portable generators, airport service equipment and forklifts) 
and agricultural (e.g., tractors, combines and irrigation pumps) 
equipment.
    Nonroad HDDEs are huge contributors to elevated levels of ozone and 
PM2.5--representing a substantial and growing share of the 
emissions inventories for both NOX and PM--thus posing a 
substantial threat to public health, including, among other things, 
premature mortality from exposure to PM2.5, as I discussed 
earlier. In fact, the aggregate NOX and PM emissions from 
nonroad HDDEs exceed those from all of the nation's highway diesel 
engines. In addition, the Clean Air Scientific Advisory Committee has 
concluded that diesel exhaust is a likely human carcinogen at 
environmental levels of exposure, further heightening the need to take 
swift and aggressive action to control emissions from nonroad HDDEs. 
Given the limited authority states and localities have to regulate 
heavy-duty engines and their fuels, rigorous new federal standards for 
nonroad HDDEs and nonroad diesel fuel--equivalent to those for onroad 
HDDEs and fuels and in the same timeframes--are imperative.
    STAPPA and ALAPCO have been advocating such new nonroad standards 
for several years. Specifically, our recommendations are based on 
several key principles that include the following: 1) availability of 
15-ppm low-sulfur nonroad diesel fuel beginning in June 2006, subject 
to the same flexibilities and schedules provided under the onroad low-
sulfur diesel fuel program; 2) promulgation of Tier 3 nonroad HDDE 
standards for PM (for all horsepower engines covered by the rule), 
based on emission reductions of 90+ percent (similar to the PM 
reductions achieved by the onroad heavy-duty diesel rule) to be fully 
applicable in 2007; 3) promulgation of Tier 4 nonroad HDDE standards 
for NOX (for 50 to 750 hp engines), based on emission 
reductions of 95+ percent (similar to the reductions achieved by the 
onroad heavy-duty diesel rule), to be phased in between 2007 and 2010; 
and 4) a strong program to ensure that in-use emissions are not 
compromised by durability issues, the use of defeat devices or other 
factors.
    Unless emissions from nonroad HDDEs are sharply reduced, it is very 
likely that many areas of the country will be unable to attain and 
maintain national health-based air quality standards for ozone and PM. 
Moreover, a nonroad heavy-duty diesel rule that establishes engine and 
fuel standards equivalent to those for onroad HDDEs and in the same 
timeframes will yield enormous public health benefits. EPA must take 
full advantage of the opportunity to adopt meaningful and timely 
controls for nonroad HDDEs and their fuels.
Hazardous Air Pollutants
    The serious and pervasive public health threat posed nationwide by 
emissions of hazardous air pollutants (HAPs) is another continuing 
concern of STAPPA and ALAPCO. Just last week, EPA released the results 
of its National-Scale Air Toxics Assessment (NATA), which provides 
nationwide estimates of exposure and health risks associated with 32 
HAPs. According to EPA, more than 200 million people in the U.S. live 
in areas where the lifetime cancer risk from exposure to HAPs exceeds 1 
in 100,000. Moreover, approximately 3 million face a lifetime cancer 
risk of 1 in 10,000. Considering that EPA has established 1 in 
1,000,000 as the generally acceptable level of risk, these estimates 
not only illustrate the pervasive nature of the threat posed by HAPs, 
they also speak to the level of effort that will be required to reduce 
the risk and the high level of priority that should be placed on doing 
so.
    According to EPA's data and information collected by state and 
local agencies, one of the primary sources of HAPs is motor vehicles, 
including cars and trucks. EPA has estimated that approximately 50 
percent of all national HAP emissions, which do not include diesel 
exhaust, comes from mobile sources. The agency has further estimated 
that for more than 100 million people, the combined upper-bound 
lifetime cancer risk from mobile source air toxics exceeds 1 in 
100,000.
    In recognition of the health impacts of mobile source air toxics 
and the limited capacity of states and localities to directly regulate 
mobile sources and fuels, Congress included in section 202(l) of the 
1990 Clean Air Act a requirement for EPA to promulgate regulations to 
control mobile source emissions of toxic air pollution. Specifically, 
the Act mandated that ``[t]he regulations shall contain standards for 
such fuels or vehicles, or both, which the Administrator determines 
reflect the greatest degree of emission reduction achievable through 
the application of technology which will be available . . . The 
regulations shall, at a minimum, apply to emissions of benzene and 
formaldehyde.'' Unfortunately, EPA's action relative to this statutory 
requirement--a December 2000 rulemaking--is deficient. Instead of 
aggressively addressing mobile source air toxics in a manner consistent 
with section 202(l) and proportionate to the risk posed, the rule calls 
for nothing more than the status quo and merely contemplates additional 
regulation in 2004, if further study warrants it. Clearly, far more is 
necessary at the federal level to adequately address this critical 
public health threat.
    With respect to industrial sources of toxic air pollution, the 
Clean Air Act called for EPA to establish technology-based standards 
for a large number of source categories by November 2000. These 
standards--known as MACT (Maximum Achievable Control Technology) 
standards--were to require new sources to apply state-of-the-art 
technology and existing sources to achieve reductions equal to those 
achieved by the top performing existing sources. Regrettably, EPA has 
not fulfilled its obligation; more than 18 months after the statutory 
deadline, 36 MACT standards covering 62 source categories still have 
not been established. Under the section 112(j) of the Clean Air Act, 
state and local air pollution control agencies are obligated to 
establish MACT on a case-by-case basis for all source categories for 
which EPA has not set standards. Although the agency has taken 
regulatory steps to delay this state and local obligation, 
environmental groups have objected and it is unclear what the section 
112(j) case-by-case MACT regulation will ultimately require. More 
importantly, however, each day that these sources remain uncontrolled, 
many millions of people continue to be exposed to hazardous pollutants. 
EPA must do everything in its power to establish these standards as 
quickly as possible.
    In addition to calling for MACT standards, the Clean Air Act calls 
for Residual Risk standards, to reduce the risks that remain after 
implementation of the MACT standards. EPA is required to establish 
Residual Risk standards eight years after the issuance of MACT 
standards. However, EPA's delay in establishing MACT standards has also 
delayed establishment of the health-protective Residual Risk standards. 
To minimize the public's exposure to dangerous toxic air pollution, EPA 
must work diligently to establish Residual Risk standards as quickly as 
possible.
New Source Review
    The Clean Air Act's NSR program is a fundamental component of our 
nation's clean air program. For the past 25 years, NSR has been 
instrumental in achieving millions of tons of emissions reductions that 
otherwise would not have occurred. Air quality in the U.S. is decidedly 
better because of this program. However, notwithstanding the pivotal 
role NSR has played in environmental protection and the fact that for 
new sources the program is working well, there is broad consensus that 
the program can be improved with respect to requirements for major 
modifications to existing sources. Over the past eight years, STAPPA 
and ALAPCO have worked with EPA and other stakeholders to develop 
recommendations in this regard. During that time, our associations have 
gone on record in favor of reforms to the NSR process, and we continue 
to hold that position.
    Although STAPPA and ALAPCO do not believe that the current NSR 
program is preventing industry from expanding or from increasing 
efficiency, we do believe that, with respect to major modifications, 
certain flexibilities should be afforded to sources that install the 
best controls. For example, our associations have agreed that sources 
that install the best available controls today should be afforded a 
clean unit exemption--that is, an exemption from further NSR for a 
limited time into the future. Similarly, we have supported a plant-wide 
applicability limit (PAL), provided it declines over time to a level 
reflecting installation of best available controls and requires all 
significant new sources constructing under the PAL to install the best 
available controls.
    In short, STAPPA and ALAPCO support reform, not replacement, of the 
existing NSR program with two provisos: 1) such reforms should be 
limited to major modifications and 2) under no circumstances should 
reforms result in any less protection of the environment than is 
derived under the current program.
Funding
    One final issue on which I would like to touch is federal funding 
for state and local air pollution control agencies. It is well 
established that air pollution presents a pervasive national threat to 
public health and the environment. The health risks are not only 
significant, we know of no other environmental problem presenting 
greater risk. Air quality regulators at all levels of government have 
worked diligently for many years in pursuit of our clean air goals. In 
spite of the considerable improvements that we have achieved, clean, 
healthful air nationwide still eludes us.
    Over 160 million tons of pollution are still emitted into the air 
each year. One hundred and twenty one million people live in areas of 
the country that violate at least one of the six health-based NAAQS, 
not to mention the many millions of people who are exposed to toxic air 
pollutants that cause cancer and other health problems. The magnitude 
of our air quality problem and the associated health effects make it 
clear that funding for the control of air pollution should be a top 
priority. Unfortunately, the reality is that state and local air 
agencies are underfunded. Although states and localities devote 
significant resources to their air quality programs, air agencies have 
been operating for years with inadequate financial support from the 
federal government. As a result, many of our programs are not as robust 
as they need to be.
    A few years ago, STAPPA and ALAPCO, in cooperation with EPA, 
conducted a study of air program funding and estimated that federal 
grants to state and local air pollution control agencies under Section 
105 of the Clean Air Act fell short of our needs by nearly $100 million 
a year. While we have received modest funding increases in recent 
years, these increases are simply not enough, especially in light of 
our expanded responsibilities. Unless our programs receive a 
substantially greater boost in funding, we will continue to face a 
serious financial shortfall, which will adversely affect our ability to 
protect and improve air quality. This shortfall will only become worse 
as greater demands are placed on our programs. Among the air program 
priorities for which state and local agencies require additional 
funding are HAPs; fine particulate matter, especially diesel 
particulate; compliance; inspections; monitoring; data improvements, 
including maintaining and improving infrastructures, emission 
inventories and modeling; haze and visibility monitoring; and outreach 
to and education of the public and regulated community.
    We urge Congress to give careful consideration to our request for a 
$25-million increase in FY 2003 federal grants to state and local air 
agencies under Sections 103 and 105 of the Clean Air Act.
    Finally, notwithstanding the pivotal role of state and local air 
agencies in our nation's air quality program, we cannot do the job 
alone. A strong and effective EPA that is adequately funded to carry 
out its responsibilities is essential to state and local efforts. 
Accordingly, we encourage Congress to ensure that EPA is also well 
funded, and to consider increasing, rather than decreasing, EPA's 
budget to allow the agency to carry out such important activities as 
those related to fine particulate matter; mobile sources; retrofitting 
diesel school buses; national emission standards, including toxic air 
pollutant standards; training; health research and risk estimates; and 
modeling.
Conclusion
    Is the Clean Air Act the perfect environmental statute? No. But it 
has proven to be a good, sound, workable law with the potential to 
yield clean air in an efficient and cost-effective manner.
    As we look back on our implementation of the Clean Air Act over the 
past 11 and a half years, we can do so with pride for all that we have 
accomplished. Though challenges still lie ahead, there are many 
opportunities for rising to these challenges. As we look forward, we 
should do so in a way that focuses on how we can augment, rather than 
replace, our current statutory foundation so that the considerable 
momentum we have created is not disrupted.
    Among other things, we can look to and learn from the successes 
that have resulted from regional initiatives. Beyond the firm 
foundation provided by strong federal programs, such regional efforts 
allow for the development of approaches tailored to regional needs.
    We can also continue our efforts to identify and implement 
innovative approaches to addressing air pollution and find ways to 
capitalize on the flexibilities provided by the law to resolve 
implementation problems and move ahead. Our past experiences in seeking 
``common-sense'' solutions to difficult issues have demonstrated that 
the current statute is structured to accommodate change and keep pace 
with our needs.
    Above all, we must remember that the most valuable asset our nation 
can ever have is a healthy population and a clean environment. In 
working to achieve our clean air goals, protecting these assets must be 
our highest priority.

    Mr. Shimkus. Thank you.
    And I do want to commend the panel for really doing a good 
job on the opening statements. If you are doing that well 
protecting the air as you are staying on track of time, I think 
we are in pretty good shape.
    Now I would like to welcome Mr. Doug Lempke, Administrator 
of Air Quality Control Commission, Colorado Department of 
Public Health and Environment. You have 7 minutes, sir.

                    STATEMENT OF DOUG LEMPKE

    Mr. Lempke. Good afternoon, Mr. Chairman, members of the 
committee. My name is Doug Lempke, and on behalf of Governor 
Owens I would like to thank you today for holding this hearing 
and for giving the State of Colorado the opportunity to share 
some of our successes under the Clean Air Act and some of our 
thoughts on implementing emission reduction programs to meet 
the requirements of the Act.
    Colorado's overall experience in working with EPA, 
particularly Region VIII, has been positive. However, we 
believe that changes to the Act and overall programs within EPA 
would enhance the tools States are provided to improve and 
protect air quality, as well as provide more options to State 
agencies to implement effective air quality management 
strategies and demonstrate our ability to maintain compliance 
into the future.
    Over the past 3 years, Colorado has made it a top priority 
to ensure that our non-attainment areas meet the national 
standards and will continue to meet them into the foreseeable 
future. The Denver metro area was once one of two areas in the 
United States to be out of compliance with five of the national 
ambient air quality standards.
    As of today, EPA has proposed--EPA has approved our 
redesignation plans for the Denver metro area for all but the 
pollutant PM10, which they have currently proposed 
for approval in the Federal Register. This makes the Denver 
metro area the first major metropolitan area in the country to 
demonstrate its ability to maintain long-term compliance with 
so many problematic pollutants.
    Region VIII EPA has been particularly helpful in completing 
this process over the past 3 years. And without their upfront 
involvement in the process, we would not be where we are at 
today.
    Additionally, my comments today will focus on requirements 
for the vehicle inspection and maintenance programs, EPA's 
guidance and its usefulness to States, and the Regional Haze 
Rule. Colorado believes that enormous emission reductions have 
been achieved over the years through the implementation of the 
corporate CAFE or the Federal CAFE standards. However, it has 
been necessary to implement vehicle inspection and maintenance 
programs in many non-attainment areas to demonstrate compliance 
with the national standards.
    These programs require all vehicles to be tested to 
identify a small number of higher-emitting vehicles that 
require repairs. In some cases, such as Denver, enhanced 
vehicle inspection and maintenance programs are required to be 
implemented under the Act.
    Colorado believes that the technology and programs exist to 
identify high-emitting vehicles without putting each motorist 
through the process of visiting the vehicle testing center. 
These programs utilize remote sensing instrumentation in 
programs referred to as clean screening or high-emitter 
programs. We would suggest that the Act and EPA regulations 
should readily provide for the implementation of these types of 
programs instead of the traditional I&M programs.
    Over the years, EPA has undertaken an enormous effort to 
develop guidance documents and keep track of numerous 
memorandum of interpretation of the programs and provisions of 
the Clean Air Act. These guidance documents and memorandum can 
be useful resources. However, they are often adhered to as if 
they were rules and regulations unto themselves.
    This often strict adherence to guidance blunts the attempts 
of State agencies to creatively apply air quality strategies to 
meet the requirements of the Act. Colorado suggests that 
guidance documents should be present--should represent a 
readily approvable avenue to compliance but not the only 
avenue.
    We propose that implementation of the Clean Air Act could 
be made significantly more flexible by changing the approach 
that EPA has taken to rely on some of the guidance documents 
and the memorandum of interpretation.
    The Regional Haze Rule focuses its primary emission 
reduction requirements on major stationary sources of 
visibility impairing pollutants. However, there are many 
sources of pollutants that contribute to visibility impairment 
in our national parks and wilderness areas.
    The first phase of the rule focuses on application of 
emission controls to stationary sources alone through the 
analysis and application of best-available retrofit control 
technology. This process is complicated and litigious at best 
and unworkable at worst. In fact, the DC Circuit Court of 
Appeals, a little over a week ago, remanded at least part, and 
some have argued all, of the rule back to EPA over this very 
issue.
    Colorado believes that prior to our moving forward with 
implementation of the Regional Haze Rule, EPA needs to resolve 
the provisions that were remanded by the court. Under the rule, 
Western States were provided with two options to comply with 
the rule, and at this point at least one of those options is 
clearly affected by the court ruling.
    We were on the verge of making the choice of which approach 
to follow, but now we must take a step back and understand what 
the court has done, as well as wait for EPA to take action on 
the remand. We suggest that EPA and/or Congress resolve the 
BART issues, as well as any other issues, as expeditiously as 
possible.
    That concludes my testimony. Again, we appreciate the 
opportunity to testify here today. And if you have any 
questions, I would be happy to try to answer them.
    [The prepared statement of Doug Lempke follows:]
 Prepared Statement of Doug Lempke, Administrator, Air Quality Control 
    Commission, Colorado Department of Public Health and Environment
    Good afternoon Mr. Chairman, members of the Subcommittee, thank you 
for holding this hearing today and for giving the State of Colorado the 
opportunity to share some our successes under the Clean Air Act and to 
share some of our thoughts on implementing emission reduction programs 
to meet the requirements of the Act.
    Colorado's overall experience in working with EPA, particularly 
Region VIII, has been positive. However, we believe that changes to the 
Act and overall operations within EPA would enhance the tools states 
are provided to improve and protect air quality as well as provide more 
options to state agencies to implement effective air quality management 
strategies and demonstrate our ability to maintain compliance into the 
future.
    The issue of implementing programs to demonstrate long-term 
compliance with national standards is a particularly timely subject for 
the Subcommittee to ask the State of Colorado to address. Over the past 
three years Colorado has made it a top priority to ensure that our non-
attainment areas meet the national standards and will continue to meet 
them into the foreseeable future. We are particularly proud of our work 
in the Denver Metro Area.
    The Denver Metro Area was once one of the two areas in the United 
States to be out of compliance with 5 of the National Ambient Air 
Quality Standards. At one point Denver and Los Angeles shared this 
ignoble distinction. Denver was out of compliance at one point with the 
Lead, Nitrogen Oxide, Carbon Monoxide, Ozone, and the PM10 
standards.
    Just three years ago Denver was still listed as a non-attainment 
area for Ozone, PM10, and Carbon Monoxide. As of today EPA 
has approved our redesignation the Denver Metro area for Ozone and 
Carbon Monoxide and adopted our long term compliance plans for both. 
EPA has recently proposed for public comment the approval of our Denver 
PM10 maintenance plan and request for redesignation. We 
anticipate full approval of that plan this year.
    This makes the Denver Metro Area the first major metropolitan area 
in the country to demonstrate its ability to maintain long-term 
compliance with so many problematic pollutants. It has taken us over 20 
years to reach this point with a significant amount of effort invested 
by a great number of people to comply with the federal requirements to 
improve Colorado's air quality and protect it into the future.
    Region VIII EPA has been particularly helpful in completing this 
process over the past three years. Without their upfront involvement in 
the process we would not be where we are today. We applaud Region VIII 
for their participation in our efforts and their willingness to express 
their opinion on our approaches to demonstrate long-term compliance 
with the requirements of the Act in regards to returning Colorado non-
attainment areas to attainment status. We would suggest that all 
regional EPA offices be involved in the development of proposed plans 
for non-attainment areas to demonstrate long-term maintenance of the 
national standards as EPA has been with Colorado.
    This is our greatest success story of implementing the requirements 
of the Clean Air Act, with the help of EPA. Additionally, my comments 
today will focus on; 1. Requirements for vehicle inspection and 
maintenance programs; 2. EPA guidance and its usefulness to states; and 
3. The Regional Haze Rule
Vehicle Inspection & Maintenance Programs
    Colorado believes that enormous emission reductions have been 
achieved over the years through the implementation of the federal 
Corporate Average Fuel Economy Standards and that these standards have 
provided much of the benefit that carbon monoxide and ozone non-
attainment areas have relied upon to achieve the national standards. 
However, it has been necessary to implement vehicle inspection and 
maintenance programs in many non-attainment areas such as the Front 
Range Communities in Colorado. These programs require all vehicles to 
be tested to identify a small number of higher emitting vehicles that 
require repairs to lower vehicle emissions to acceptable levels. In 
some cases, such as Denver, enhanced vehicle inspection and maintenance 
programs are required to be implemented under the Act.
    Colorado believes that the technology and programs exist to 
identify the high emitting vehicles without putting each motorist 
through the process of visiting the vehicle testing center. We believe 
that the implementation of such programs could be used to maintain air 
quality compliance with the national standards and should be readily 
provided for under the Act. These programs utilize remote sensing 
instrumentation and can identify vehicles with lower emissions in 
programs referred to as ``Clean Screening'' or conversely they can 
identify vehicles with unacceptably high emissions in what is typically 
referred to as ``Hi Emitter'' programs. This technology can be 
implemented through a variety of passive or active programs. Remote 
sensing can be conducted in real world or on road settings with 
subsequent notification to motorists or with motorists actively being 
pulled over on the spot for confirmatory testing and if necessary be 
required to repair the vehicle such that the emissions are reduced to 
acceptable levels.
    In addition, current requirements for vehicle inspection & 
maintenance programs mandate modeling techniques with EPA approved 
models that have been sharply criticized to over-predict the impacts of 
mobile source emissions on ambient air quality. In fact, the National 
Research Council reached this conclusion in their 2001 report where 
they stated;
          The MOBILE model will continue to be used to determine future 
        emissions-reduction credits that states will receive from 
        implementing I/M or from modifying their current I/M programs. 
        MOBILE is a static, not a dynamic, model and is therefore a 
        simplified representation of emissions changes from I/M. 
        Historically, MOBILE has overestimated emissions reductions 
        from I/M programs. It remains to be seen whether MOBILE6, which 
        is a major revision from MOBILE5, will also overestimate I/M 
        benefits or whether it will be a more accurate representation 
        of I/M benefits. Indications are that MOBILE6 will estimate 
        lower emissions reductions from I/M programs than are estimated 
        by MOBILE5.
    While MOBILE6 is an improvement with respect to quantifying the 
benefits of an I/M program, we are concerned that the model still does 
not accurately reflect the benefits of the I/M program nor does it 
quantify the degree of certainty with which it predicts the benefits. 
As mentioned, it is a static measurement and does not reflect what is 
actually happening in the real world. While identifying this problem is 
easy, identifying the solution is not. One problem is that while 
MOBILE6 is an improvement over MOBILE5 it has taken so long for it to 
come out that newer data is most likely available that would be more 
reliable. Therefore, a recommendation that we would make is that the 
turnaround time on revisions to the MOBILE model be reduced so that it 
is not outdated when we receive it.
EPA Guidance Documents
    Over the years EPA has undertaken an enormous effort to develop 
guidance documents and keep track of numerous memorandum of 
interpretation of the programs and provisions of the Clean Air Act. 
These guidance documents and memorandum can be useful resources, 
however, they are often adhered to as if they were rules and 
regulations in and of themselves. This often strict adherence to 
guidance blunts the attempts of state agencies to creatively apply air 
quality strategies to meet the requirements of the Act to the situation 
of the day. All to often we experience circumstances of a situation 
that are different than the guidance, but we are required to adhere to 
the guidance and make it fit. This is particularly true in the modeling 
of emission impacts and permitting of stationary sources.
    Colorado suggests that guidance documents should be just that--
guidance on how to achieve the desired result. We believe that guidance 
documents should be, at least somewhat, open to interpretation. We 
believe that guidance documents should present a readily approvable 
avenue to compliance, but not the only avenue. We also believe that the 
programs we submit for consideration of approval into our State 
Implementation Plan should not be put on hold until guidance is 
developed only to have the program subsequently rejected because it 
does not follow the guidance.
    We propose that implementation of the Clean Air Act could me made 
significantly more flexible by changing the approach that EPA has taken 
to reliance on the guidance documents and the memorandum of 
interpretation it has created. We believe that this added flexibility 
could address many of the issues that we, and other states experience 
in attempting to implement the requirements of the Clean Air Act.
    Colorado has previously commented on the inflexibility of guidance 
in regard to the overhaul of the New Source Review Program and the 
proposed multi-pollutant legislation and can make those comments 
available.
Regional Haze Rule
    The regional haze rule focuses its primary emission reduction 
requirements on major stationary sources of visibility impairing 
pollutants. There are many sources of pollutants that contribute to 
visibility impairment in our National Parks and Wilderness Areas, 
however, the first phase of the rule focuses on application of control 
technology requirements to stationary sources alone through the 
analysis of Best Available Retrofit Technology. This process is 
complicated and litigious at best and unworkable at worst, and in fact, 
the DC Circuit Court of Appeals, a little over a week ago, remanded the 
determination of BART in the regional haze rule back to EPA for further 
action.
    On Friday, May 24th the DC Circuit Court of Appeals issued its' 
ruling in American Corn Growers Association versus United States EPA. 
It appears that the Court ruled that the process of analysis to 
determine the most appropriate Best Available Retrofit Technology to an 
individual source was invalid. The Court vacated the BART rules and 
remanded them to EPA. In its opinion the court expressed that the 
manner in which EPA addressed the five factors to be considered in a 
BART analysis were inconsistent with the text and structure of the Act.
    Colorado believes that prior to our moving forward with 
implementation of the regional haze rule, EPA needs to resolve the 
provisions that were remanded by the court. While it is important to 
resolve haze issues in our country's Class I areas, we suggest that the 
legal issues raised with the rule must be resolved before we can move 
forward with its implementation. Under the rule western states were 
provided two options to comply with the rule and at this point at least 
one of those options is blurred. In Colorado, the choice of which 
option to pursue has been very controversial. We were on the verge of 
making that choice as the court issued its ruling. Now, we must take a 
step back and understand what the court has done as well as wait for 
EPA to take action on the remand.

    Mr. Shimkus. Thank you, and we appreciate your attendance 
today.
    I think the chairman has directed that I ask Mr. Shadegg if 
he would like to take the first round of questions. You have 5 
minutes.
    Mr. Shadegg. Yes, I would very much. Thank you very much. I 
will be brief.
    I want to begin by asking you, Mr. Williams, about the 
issue of diesel and the--you touched upon in your testimony the 
issue of diesels that are currently exempt. As I understand it, 
that includes diesel construction equipment, anything that is 
considered off-road diesel equipment. Does that include--and 
that would include construction equipment and farm equipment, 
is that correct?
    Mr. Williams. Yes.
    Mr. Shadegg. Does that also include diesel railroad trains?
    Mr. Williams. I believe EPA has a separate rulemaking for 
locomotives.
    Mr. Shadegg. It has a separate rulemaking?
    Mr. Williams. I believe so.
    Mr. Shadegg. Okay.
    Mr. Williams. And I think also for marine engines there has 
been a separate rulemaking. So the primary--I am sorry.
    Mr. Shadegg. Can you elucidate for me when those exemptions 
were granted, whether or not you think they are appropriate, 
and how you think we ought to address whether they should be 
continued or they should be brought in? Because it seems to me 
if we are doing--we are making real progress on over-the-road 
diesel engines, and while I don't disagree with having exempted 
them initially, it seems to me at some point you have to 
broaden the net and bring in other sources. And I guess I am 
interested in specifically what it is you recommend with regard 
to those sources.
    Mr. Williams. I don't know that it is so much an exemption 
as that they have not yet been regulated through the Clean Air 
Act. The first significant category were the on-road diesels, 
both with the technology--the emissions technology and sulfur 
in the fuels.
    This remaining category of non-road, which includes 
construction, industrial, agricultural, really dwarfs, in terms 
of the magnitude of emissions, the on-road. And what we have 
recommended is a very similar approach over similar timeframes 
both addressing the technology for emissions control equipment 
on the engine side, but also significant reductions in the 
sulfur on the fuel side.
    We believe that this--addressing this category of diesel, 
the non-road heavy-duty diesel, will dramatically improve air 
quality, will help make progress both on the ozone and the 
PM2.5 standard. Of course, there is growing concern 
about the carcinogenic impacts of diesel. So we do believe that 
this is a very important and appropriate role for EPA to extend 
regulation to, and we are hopeful and optimistic that by the 
end of the year EPA will undertake a rulemaking to do that.
    Mr. Shadegg. Well, we are making progress I think on clean 
diesel. We are getting close. I believe there is a 
significantly improved standard to be in effect for 2004. And I 
hear discussions--and I have asked a couple of people that are 
constituents of mine whether it is accurate, and I get 
differing opinions. But I hear that in the not-too-distant 
future we are on the verge of a diesel engine that is cleaner 
than a natural gas engine. And there has been some discussion 
of that.
    I read a letter to the editor here in Washington, DC. The 
DC City Council just bought a bunch of natural gas buses, and 
shortly after doing so a letter to the editor appeared saying 
that was foolish because they are costly, and we are on the 
verge of a diesel engine that is cleaner than a natural gas 
engine.
    And while I don't want to impose a burden on some of these 
industries, particularly the farm industry or the construction 
industry, or, for that matter, the trains that move a great 
deal of freight, it seems to me over the road was our first 
target. If over the road has been the cutting edge to get to 
cleaner diesel, then we ought to be expanding that cleaner 
diesel out to where it is applicable in other sources.
    And it seems to me if we are going to--there is no point in 
having two different diesel fuels around. If we have a cleaner 
diesel for over the road use, I see little reason to make it 
not applicable also to off the road or used for engines that 
are not on the road.
    I guess the other question I would like to ask is Mr.--do 
you pronounce your name Lepemke?
    Mr. Lempke. Lempke.
    Mr. Shadegg. Lempke. Okay. I was fascinated by your 
testimony on the issue of guidance, and I was a little bit 
confused. I want to make clear, what you are saying is that 
using the term ``guidance,'' the EPA is essentially 
establishing rules without actually creating rules. Or is it 
that people just follow them as rules voluntarily?
    I mean, is it a problem that EPA needs to correct by making 
it clear that they are not--that you, as the State of Colorado, 
are not bound by guidance? Or is it a problem that people just 
don't have the courage to not follow guidance?
    Mr. Lempke. Thank you. I think it is a little bit in 
between the two of those.
    Mr. Shadegg. Okay.
    Mr. Lempke. I think everybody realizes that they are not 
enforceable as rules. But in practice, overcoming that is 
difficult. So just, you know, leaving those guidance documents 
and those memorandum up to a little bit of interpretation to 
the situation of the day, so to speak, would be a bit more 
helpful, you know. Just a little bit of change in the way that 
EPA overall looks at those.
    Now, we have worked with Region VIII pretty well on that, 
but it is difficult sometimes. As I think was mentioned earlier 
in a presentation here today, some of these guidance documents 
are, you know, hundreds of pages long. And that, in and of 
itself, is a giant hurdle to get over when you are trying to 
look at trying to implement a program.
    Mr. Shadegg. Well, I am very sympathetic with your call for 
flexibility. My home State is Arizona. The air pollution 
problems we face in Arizona are dramatically different than 
they face in, say, Maine, or maybe even Virginia. We have 
severe problems with particulate driven by dust. That is not a 
problem in other parts of the country. We have lots of dirt 
roads still in existence.
    We have just lots of issues, and there are many places 
where we need flexibility, and I thought you made a rather 
compelling case for how flexibility has worked for Colorado. 
And if the Congress needs to address this issue of making it 
clear that guidance is guidance, and that you cannot be held 
accountable for deciding that that guidance doesn't work for 
your State, I would be happy to work on that point, because I 
think that is a valid point.
    If, in fact, something rises to the level of requiring a 
rule, make it a rule. But if it is guidance and it will work 
for Maine or Minnesota or Michigan, or someplace where it is 
wet and green, but it won't work for parts of Arizona which are 
dry and brown, or, for that matter, parts of Colorado that are 
dry and brown, I think you need the flexibility to use what 
works in your region.
    Mr. Shimkus. The gentleman's time has expired. The Chair 
recognizes the gentleman from Ohio, Mr. Sawyer, for 5 minutes.
    Mr. Sawyer. Thank you very much, Mr. Chairman.
    Mr. Jones, thank you very much for being here and for your 
testimony. You talked about the significant progress that our 
State has made in meeting the 1-hour ozone standard. Are there 
regulatory approaches in Ohio that can serve as lessons 
elsewhere in the country, either for the 1-hour standard or for 
other standards that are involved in the Clean Air Act?
    Mr. Jones. Mr. Sawyer, I probably risk alienating the 
Northeast States. They get offended when I say we are in 
attainment and they are not. Part of what we did, as you know, 
was the enhanced automobile emissions testing, which I think 
has been described as the single-most unpopular program Ohio 
has ever put in place.
    Mr. Sawyer. Painful.
    Mr. Jones. But we did it at a relatively low cost for the 
motoring public, and we did it to our targeted non-attainment 
areas.
    What we attempted to do was essentially broaden the base 
that sought reductions. We have obviously made significant 
reductions, believe it or not, in our powerplant emissions. I 
think the statistics I mentioned in my testimony are an 
indication that we have literally gone after pretty much all of 
the sources in our State, and we will face that again with the 
new 8-hour standard once we get an implementation plan 
promulgated by U.S. EPA.
    But I think the one item I would suggest is there has to be 
the ability to look at regional approaches. But your definition 
of ``region'' is the key. I think we are--we have never said 
anything but that we have an impact on Western Pennsylvania, 
and I think that is what all of the modeling says. We have a 
very hard time convincing people that the State of Maine is in 
non-attainment because of Ohio.
    Certainly, there are transport issues, and we have 
acknowledged that, but there is a need for a regional approach. 
And where it is particularly important is an area like 
Cincinnati. The Cincinnati metropolitan area actually goes into 
Northern Kentucky, which not only puts us into another State 
but into another U.S. EPA region.
    And you have the potential for literally the same 
metropolitan area having separate designations from separate 
U.S. EPA regions governed by different State law and 
regulation. And it makes it tremendously complicated for us to 
try to come up with something that isn't impacted downwind.
    Mr. Sawyer. What can we do from here?
    Mr. Jones. I think the--and this is the difficult part of 
it. You keep hearing about flexibility from us, and I think 
that is the linchpin. I think there is--there seems to always 
be a concern that there will be a race to the bottom at the 
State level. And I think what you have seen when you look at 
the facts is the States aren't racing to the bottom.
    Mr. Sawyer. I think that is----
    Mr. Jones. In simplest terms, we can't afford to. And so I 
think allowing States to experiment, and sometimes not succeed, 
is a key to this. And, unfortunately, the penalties that are 
imposed are significant, and there is not a lot of incentive 
not to follow the guidance or follow the cookbook.
    Mr. Sawyer. Everybody has talked about flexibility, and 
some of you have talked about the importance of market-based 
trading systems.
    Could you care to comment--would any of you care to comment 
on the efficacy of such systems in dealing with mercury? No?
    Mr. Nicholson. Well, I think just a quick reaction, I know 
people do get excited about that prospect, maybe in both 
directions. But a lot of people feel like that given the 
immediate area health concerns that maybe that is not the right 
course to follow.
    We haven't, in North Carolina, given it a lot of thought 
yet, even though our bill, our Clean Smokestacks Bill, has a 
provision where we are to study the issues of need for control 
further than what we may get with our scrubbers for the SO2, 
which we hope to get a considerable co-benefit. But we are to 
report back to the legislature in 2005 with recommendations on 
what to do about mercury beyond what we might otherwise be 
getting.
    But we are allowing trading within the State for the SO2 
control. So this will be an issue we will have to study. I 
think, though, any program that would allow trading must 
necessarily have a provision that allows for protection of 
local impacts, assuming we can learn enough to understand how 
to do that. That could very well be an issue, and what are 
those impacts and the nature of them.
    Mr. Sawyer. Thank you.
    Mr. Shimkus. The Acting Chair now turns to the chairman of 
the subcommittee, Mr. Barton, for 5 minutes.
    Mr. Barton. Thank you, Mr. Chairman. I enjoy being down 
here. I can throw bombs from here. You know, I can't--I have to 
be responsible when I am sitting where you are sitting.
    I want to commend our panel today. We have worked very hard 
to try to get a balanced panel of State and local input on the 
Clean Air Act. And I have read your testimony, and I have 
listened to some of the answers to the questions, and I just 
want to compliment each of you individually for being here.
    I have a general question, and then I have some specific 
questions. My general question, which is open to all of you, we 
have a--I think our representative from Utah put it best, that 
the basic model of State, Federal, and local interaction, or 
that Federal set the standard but we ask the States and locals 
to help implement it, with kind of a negotiation or a 
cooperative approach, it works, but it works very cumbersomely.
    One of the things that the Feds have which causes a lot of 
consternation at your level is this ability to threaten these 
huge fines and the withholding of highway funds if you don't do 
certain things. Now, those threats are normally made by some 
mid-level, non-responsible EPA representatives, so that if your 
level complains to my level, and my level complains to the EPA, 
the EPA says, ``We didn't do that,'' because it didn't come 
from the person who could actually impose the fine or withhold 
the funds.
    We have to have some hammers. So my general question--and 
if you all can't give us an answer today, if you want to talk 
to your association groups--I would be very interested in an 
alternative hammer. In other words, doing away with the 
withholding of highway funds or the threat of withholding of 
highway funds.
    If we were to eliminate that, but still need some sanction 
weapon, some sanction instrument in the Federal arsenal, what 
would that be? How could we maintain the general model yet 
eliminate the highway fund withholding and maybe these huge 
fines, but still give the Federal Government some ability to 
sanction its State and local governments--just refuse to 
cooperate.
    If you all want to take a stab at it right now on the 
record, fine. If you want to think about it and get back to us 
in writing, that is fine, too. But that is my general question. 
I think, Mr. Jones, you have got a comment.
    Mr. Jones. Mr. Barton, I am the sixth kid in my family, and 
our negotiations with the U.S. EPA are a lot like when I 
negotiate with my older brothers.
    Mr. Barton. Big brother, huh?
    Mr. Jones. Yes, I can negotiate, but that is my big brother 
and they are going to win. And I think without talking to my 
colleagues at ECOS, I think part of it is the incentive side of 
it. Other than the intrinsic value of cleaning the environment, 
you don't necessarily gain anything by doing more or meeting 
the deadlines.
    And there is certainly an intrinsic value to improved 
environmental conditions, but beyond that there is a big hammer 
and not sort of a co-equal incentive on the other end.
    Mr. Barton. Well, it is a hammer that is seldom used. But 
it is often intimated that it will be used. So what I am 
looking for is something that you may not threaten it as often, 
but if the State and locals don't cooperate, you could actually 
use it, but the highway thing just seems like a nuclear bomb. I 
mean, and in Texas when, you know, cars stalled in traffic in 
the Dallas/Ft. Worth area probably are 60 percent of the 
emissions problem, it doesn't make a lot of sense to withhold 
highway funding, which is going to make the problem even worse.
    Does anybody else want to comment on it before I go into my 
specifics? Let the record show they are all shaking their heads 
no.
    I want to ask the gentleman from Colorado, one of your 
citizens 12, 13, 14 years ago, when we did the Clean Air Act, 
came to me with an idea for remote sensing, which some--I think 
in its commercial form is called the Smog Dog. EPA has pretty 
well fought that tooth and nail in terms of giving credits for 
using it. But good ideas actually do work, and that technology 
does work, and it has been used in some parts of the country. 
Colorado has used it some.
    What would you recommend we do if we--when we do 
legislative revisions to the Clean Air Act to perhaps increase 
the availability of that as a solution to some of the issues 
that we are trying to address?
    Mr. Lempke. Thank you. The Denver metro area, as a serious 
carbon monoxide non-attainment area, was required under the 
statute to implement an enhanced inspection and maintenance 
program, when we fully had available a remote sensing 
technology that we could have looked at to implement instead of 
an enhanced vehicle inspection and maintenance program.
    The reason that we were termed serious is not because we 
had such excess violations. It was really because we had a lag 
in the time of turning in a plan to show long-term compliance. 
I think that if Congress or EPA were to act by statute or 
regulation, it would simply be to provide the opportunity under 
the rules or the provisions to allow for the implementation and 
the use of clean screening in either of those two fashions, or 
the implementation of remote sensing in either of those two 
fashions, sort of in the identification of clean vehicles and 
screening them out of the fleet, or identifying the high 
emitters. That technology has--or that process has a little bit 
more of a challenge I think on implementation, but it is still 
out there and seems to be, from our perspective, pretty viable.
    Mr. Barton. Okay. My time has expired. I am going to--I may 
have a wrap up question when we get back from the vote. We will 
go to the other side.
    I do want to let you know one thing. We are going to do a 
number of hearings on the Clean Air Act. We are not going to 
rush to judgment one way or the other. But when we get ready to 
go to possible legislative solutions, you know, I am really 
going to encourage members of this subcommittee to work with 
their State and local officials to come up with constructive 
improvements.
    If we are going to continue to get the air quality cleaner 
and cleaner, which we all want to do, we have got to depend 
upon people at your level to give us real world potential 
solutions, because they will not come from this town. They are 
only going to come from people that are there on the streets 
every day trying to make the Clean Air Act work.
    So while we don't have a lot of members here, this hearing 
and the follow up to it is one of the most important hearings 
we are going to do in terms of looking at the Clean Air Act. 
And I yield back.
    Mr. Shimkus. Thank you, Mr. Chairman.
    I would just say on the remote sensing, I know the State of 
Missouri uses it on exit ramps. I am from Illinois, but I 
travel through there, and they bill--they just send the passing 
form to their citizen. And sometimes the citizens forget to 
send in the money. So even though they have been told they 
passed, they haven't paid for the certification that they 
passed the test. But it is a--it is working in the State of 
Missouri from what I understand.
    I would like to yield to my other colleague from the State 
of Ohio, Mr. Strickland, for 5 minutes.
    Mr. Strickland. Thank you, Mr. Chairman.
    Mr. Jones, I will ask you a question on today's topic. But 
before I do that, I would just like to ask one question 
regarding the issue that I brought up in my opening statement 
regarding DOE's plan to ship this what I would call waste--they 
may choose to call it something else--to the Portsmouth site. 
Has DOE discussed that with you, to your knowledge?
    Mr. Jones. Well, Mr. Strickland, we have had general 
discussions with DOE at the Ohio field office level, but not in 
particular. I did have people at the meeting last night. We 
have already been in touch with a couple other States, 
Representative Portman's office. We don't believe any 
additional shipments should occur until we get very clear 
decisions made by DOE to fulfill what we believe, as you do, is 
the commitment to plants. And we are very concerned about where 
this is going.
    We have expressed that a number of times to the Secretary, 
and we will continue to press it. But we certainly share your 
concern. The Governor has been very involved in trying to work 
through this situation, as you have, and we very much 
appreciate your support as well. But we very much plan to 
comment on the meeting last night.
    Mr. Strickland. Thank you, sir. It is very reassuring to 
hear you say that.
    The only question that I have, and I know my friend Mr. 
Markey probably has lots of questions that he wants to ask, so 
I am just going to ask one question, and then, Mr. Markey, if 
you would like, I will yield the remainder of my time to you.
    You have indicated in your testimony that the Title V 
permitting process is a problem because there have been 
decisions to change forces in the middle of the stream, so to 
speak, and that a program that Ohio had that was considered 
sufficient, even a model program perhaps, is now being looked 
upon as a model--or as an effort that is inefficient or 
deficient and may be--you know, although the law hasn't 
changed, you know, you are being judged in a different kind of 
way.
    And I am wondering if you would just make a statement about 
that, and I am wondering if the others feel--if they are 
confronted with the same kind of dilemma--result of changing 
expectations after you have made good faith efforts to comply 
in every way.
    Mr. Jones. Actually, I think part of the frustration with 
changing it is that, obviously, we haven't done the most 
complicated Title V permits yet. We still have additional 
fairly complex permits, the utility permits, some of the 
refinery permits that have to be done. Part of this process was 
building up an ability to do Title V permits, the training that 
goes into learning how to do that, to prepare you to do the 
really complex ones.
    Well, 6 years ago we had a fully delegated program, and 
last November we got a letter that basically says seven 
different parts of your program, although they haven't changed, 
are now deficient. And when I look at them, some of them are, 
in my mind, kind of silly. I mean, we--the comment was, we 
don't require a report to appear in our 6-month reports.
    Well, right, we require them in a quarterly report. It 
strikes me that is a little more frequent. Doesn't make sense 
that that is a deficiency, but that is something that we have 
to then go through the rulemaking process at the State level, 
which involves public hearings, comment period, responsiveness 
to comments, then the legislative process, to approve rules.
    So it doesn't do anything to help us get these permits done 
in a timely manner, and I think everybody here shares the same 
problem. We haven't met the deadline. We are trying to meet the 
deadline. We have got--we have submitted a new schedule to U.S. 
EPA to try to actually beat the next deadline. When you change 
programs in the middle, it is going to make it hard for us to 
meet that deadline.
    Mr. Strickland. Thank you.
    I yield back my time to the Chair. If Mr. Markey wants it, 
I would be happy to yield it to him.
    Mr. Shimkus. The gentleman is recognized for 25 seconds.
    Mr. Markey. Thank you, Mr. Chairman, very much.
    You know what is interesting is that everyone comes here, 
they wait in line, and then they watch it on the screen up 
there.
    You know, like they could sit back in their office and 
watch it on WebTV, you know, Webcast. But that way they 
wouldn't be able to tell everyone back in the office who else 
was there. Okay? So I think that is the only reason people come 
now, because they are only coming and getting a good view, you 
know, of the screen. But they can go home and say who--what 
other interests were represented in the room that the TV didn't 
pick up.
    Anyway, I thank you, Mr. Chairman.
    It is an interesting phenomena, though, watching where 
people's eyes are during the testimony.
    So we have this problem in New England. We are not 
represented on this panel, first of all, so we begin there. So 
we will have to try to construct, to some extent, the position 
that----
    Mr. Shimkus. The Chair would hate to interrupt my friend 
and colleague, but we are already 30 seconds over the final end 
of Mr. Strickland's time. If you would allow me to move back to 
regular order, I will try and make my questions real quick, so 
that you would have time to ask yours.
    Mr. Markey. Oh, sure. Have you--you haven't recognized 
yourself yet?
    Mr. Shimkus. I always defer to my colleagues.
    Mr. Markey. Oh, no. I didn't know that you hadn't asked----
    Mr. Shimkus. No, we are still--we still have Mr. Whitfield 
and myself, and we are bouncing back and forth.
    Mr. Markey. Oh, I did not know that. I did not know that. 
Okay.
    Mr. Shimkus. And I will be quick. I wanted to ask Ms. 
Nielson, based upon the May 24 DC Court of Appeals decision 
recently on the EPA's regional haze, can you please clarify 
whether the recent Appeals decision will inhibit the WRAP Annex 
or the States that are parties to the Annex from moving forward 
to address regional haze and visibility issues in the west?
    Ms. Nielson. Mr. Chairman, I don't believe it will impact 
the Annex or the Section 309 programs. The Annex, in fact, 
includes a set of milestones which are specifically designated 
within the rule that is now out for public comment and a 
backstop trading program, both of which will assure that we 
make reasonable progress.
    So I believe that the Annex could go forward through 
rulemaking. We hope EPA will adopt it promptly, because, as I 
indicated in my testimony, that needs to be in place for us to 
submit SIPs by the end of December 2003. And that with that 
rule in place that the Section 309 program, as the State of 
Utah looks at it, could go forward.
    Mr. Shimkus. Great. Thank you.
    Mr. Lempke, I am also very interested in New Source Review, 
and I think in your testimony you talk about some of the 
problems of the limitations. Can you readdress that for us?
    Mr. Lempke. Thank you. Some of the primary problems that we 
have had in New Source Review is with the guidance documents. 
EPA has issued several interpretations, memoranda of 
interpretation with regard to how the New Source Review Program 
is implemented. And some of these guidance documents and 
memoranda are even conflicting with themselves.
    It has been very difficult for the State of Colorado to 
implement some of the New Source Review provisions and comply 
with the guidance also.
    Mr. Shimkus. Go ahead and just continue talking. We are 
used to them.
    Mr. Lempke. So it is--some of the provisions of the New 
Source Review Program, in regards to the guidance, have been 
most difficult for Colorado.
    Mr. Shimkus. Thank you. And if I can get Mr. Markey back in 
here, I will give him some of my final time.
    And, Mr. Whitfield, is he--Mr. Whitfield, for the sake of 
time, I will just yield my remaining 2\1/2\ minutes to you. And 
if you can pick up on your questions.
    Mr. Whitfield. Well, I had a number of questions, Mr. 
Chairman, but we are voting. I have got somebody out here, and 
I know these people have been very patient. But we will have a 
number of other hearings on this, but one issue that I want to 
just touch on briefly--on this issue of non-attainment, how is 
it determined in each State where monitors are placed to 
determine if a particular county or a city is in non-attainment 
or in attainment?
    Mr. Nicholson. I will try to answer that. Brock Nicholson. 
There are criteria that EPA suggests that States use in terms 
of locating monitors to cover population, types of areas, 
whether it be rural or urban, and then the States also place 
monitors to support modeling demonstrations or gather data to 
understand the impacts of urban areas. In fact, that is one of 
our problems in terms of designation of areas.
    We have what we think have been good technical reasons to 
do these models properly, placed monitors downwind of urban 
areas, typically in rural areas. And, of course, one of the 
issues that we are facing is once we measure a violation in 
that rural area, even though we think it properly represents 
the upwind urban area, which may be 30, 40--20 to maybe 60 
miles away, that it properly indicates the problem from the 
urban area, not necessarily the--suggesting a strategy is 
necessary specifically for that rural area, even though it does 
indicate, you know, population exposure and non-attainment 
there. So that is one of our issues.
    In terms of the recommendations we are suggesting for areas 
of violation and areas of influence, that kind of approach 
could help better address that issue than a one-size-fits-all, 
whole counties, whole MSAs.
    Mr. Whitfield. Well, how many monitors does the State of 
North Carolina have?
    Mr. Nicholson. We have--for ozone, we have a fairly 
extensive network, and we have anywhere from 44 to 47 a year--
operating a year statewide. This is ozone monitors. And about a 
comparable number of PM fine.
    Mr. Whitfield. And, Mr. Williams, in Louisville, how many 
monitors are there in Louisville?
    Mr. Williams. Mr. Whitfield, we have three monitors in 
Jefferson County, and then we have one each in Clark and Floyd 
and Southern Indiana, one in Bullitt, and one in Oldham. So we 
have a total of seven in the non-attainment area.
    Mr. Barton. [presiding] The gentleman's time has expired.
    Mr. Whitfield. Okay.
    Mr. Barton. If there are any other questions, put them in 
the record. We have got--recognize Mr. Markey for 5 minutes, 
and, if no other member shows up, then that will be our last 
in-person questioner, and we will adjourn.
    Mr. Markey for 5 minutes.
    Mr. Markey. Thank you, Mr. Chairman, very much.
    There is no New Englander on the panel. Just the way the 
winds blow, much of what happens in a big chunk of the country 
just blows the bad air over New England. That is just the way 
the air currents work.
    And so it is a little bit like being in a restaurant and 
having 10 guys over there on that side of the restaurant decide 
they are going to all break out cigars after dinner. And there 
is a fan right behind them blowing it all the way across the 
other side of the room toward you, and you are still eating 
dessert. And somebody goes over to complain, and they go, you 
know, ``Cut it out. You know what I mean? We have got a right 
to smoke cigars. You know? It is a free country.'' And so, you 
know, you decide you are going to start a movement to ban 
smoking in restaurants, you know, because you get very upset 
with them because they are not being respectful of what is 
happening with that fan blowing the smoke in your face. That is 
what happens to us, so we get a little bit upset by it and 
pretending that it has no impact on us.
    Mr. Nicholson, in your testimony, you touched on the need 
for stringent national standards for pollution sources 
contributing to problems beyond their State and regional 
borders. What parts, very quickly, of the Clean Air Act have 
helped control this interstate pollution problem?
    Mr. Nicholson. Well, I think that is correct. I do believe 
that we need national rules to help take care of this issue, 
even though we may have differences of opinion on the extent to 
which long-range transport occurs. Our results of our analyses 
suggest that we do need, under the national program, control 
across the Nation to deal with this issue, not necessarily----
    Mr. Markey. What have you learned from the Southern 
Appalachian Mountains Initiative that could be helpful?
    Mr. Nicholson. I think a key thing we have learned is that 
it is important to control in every State. Each State gets the 
greatest benefit from control in its own State, with some 
spillover benefit to its neighbors. Long-range transport is not 
as long-range as we had originally thought. It is a significant 
lesson learned, but necessary to be controlled across the whole 
region or country to effect benefits, even downwind in New 
England.
    Mr. Markey. Mr. Williams, do you agree with Mr. Nicholson? 
Do you agree with Mr. Nicholson as to the limits of how far 
this pollution can travel?
    Mr. Williams. Well, I assume he is talking primarily about 
ozone. I think ozone has a several hundred mile reach, based on 
the studies I have seen coming out of the Ozone Transport 
Commission. And certainly Section 126 of the Clean Air Act is 
an important mechanism that has been used in the northeast to 
impose obligations in particular on the Midwest of the U.S.----
    Mr. Markey. So are you saying that you don't believe that 
New England is affected by----
    Mr. Williams. Oh, no.
    Mr. Markey. [continuing] what is coming out of the Midwest?
    Mr. Williams. No, I am agreeing with you.
    Mr. Markey. Oh, you are agreeing with me.
    Mr. Williams. Yes.
    Mr. Markey. Okay. So do you agree with that as well, Mr. 
Nicholson, that we are affected in New England by what happens 
in the Midwest?
    Mr. Nicholson. Well, I think it is a matter of degree. I am 
not saying that all of New England's problems only come out of 
the Midwest. There may be days on which there are reasonable 
contributions. I think what is important is every State 
intervening between the Midwest and the New England area needs 
to control, to a significant degree, and I think if everybody 
does their share then we will all be better because of that.
    Mr. Markey. We now have 8 million children in the United 
States with asthma, 16 million adults, 24 million Americans 
with asthma all together, and the number just continues to 
skyrocket. And we know it is logically related to the air that 
people breathe in their lungs, and obviously this is about as 
serious a health care problem as you could have.
    Mr. Williams, New England regulators have also expressed 
strong support for the New Source Review Program. They believe 
that New Source Review has led to significant advancements in 
pollution control and that these advancements would not have 
come about without technology control-based regulation. Do you 
agree with that assessment?
    Mr. Williams. Yes. STAPPA/ALAPCO agrees with that 
assessment.
    Mr. Markey. Now, as you know, the administration's Clear 
Skies proposal is linked to elimination of the New Source 
Review Program. Jeffrey Holmstead, EPA Assistant Administrator 
for Air and Radiation, has said that New Source Review would 
provide no benefits, and even would be counterproductive with 
an emission trading system. Do you agree or disagree with Mr. 
Holmstead?
    Mr. Williams. We have had over 10 years of involvement with 
EPA and other key stakeholders working on NSR reform. We 
clearly believe that NSR should be reformed, that there are 
opportunities for improvement. We believe it should be retained 
and improved.
    Mr. Markey. He says that there are no benefits, and it 
would be counterproductive to have a New Source Review. Do you 
agree or disagree with Mr. Holmstead?
    Mr. Williams. I would tend to disagree with that.
    Mr. Markey. Disagree. Okay. Hasn't New Source Review and 
the acid rain program also, and emissions trading program, same 
concept, successfully coexisted since the 1990 amendments to 
the Clean Air Act?
    Mr. Williams. Yes.
    Mr. Markey. Yes. Isn't it necessary to maintain the New 
Source Review Program in any national emissions trading program 
in order to protect local and regional public health?
    Mr. Williams. Our associations believe that is true.
    Mr. Markey. Yes. How about you, Mr. Nicholson?
    Mr. Nicholson. Well, I think certainly a form of New Source 
Review should remain. Whether it is the existing one, that is a 
good question to look at.
    Mr. Markey. Do you disagree with Jeffrey Holmstead when he 
says that the New Source Review would provide no benefits and 
even would be counterproductive? Do you agree or disagree with 
that?
    Mr. Nicholson. Well, whether or not I agree or disagree, I 
don't understand the basis of his comment. So I guess I cannot 
comment on that.
    Mr. Markey. If those were his comments, would you disagree?
    Mr. Nicholson. I would tend to disagree with that.
    Mr. Markey. Tend to disagree.
    Mr. Nicholson. Yes.
    Mr. Markey. Okay. So, Mr. Chairman, I know that time is of 
the essence here, and there is a roll call on the floor. Again, 
I think this is the No. 1 public health issue in the country, 
and I think that we just have to deal with the fact that we are 
shortening the life expectancy of millions of people even as we 
are funding NIH to solve, you know, the--to find the clues to 
diseases.
    Simultaneously, we have a program which creates disease, 
and I am afraid that increasingly we are finding that in most--
in many, many cancers that the links are environmental and not 
genetic. And, in fact, only 10 percent of cancer is, in fact, 
genetic. That most of it comes from some other place in our 
economy.
    And since we also know that Japanese women, for example, 
contract breast cancer at only one-quarter of the rate as 
American women, but within one generation after coming to 
America they contract it at the same rate as American women, 
then there is something in our environment. There is something 
in what we do in this country. And I think this is a big part 
of it, the way in which we treat emissions from these 
powerplants and from automobiles as well.
    Mr. Chairman, I yield back the balance of my time.
    Mr. Barton. I thank the gentleman from Massachusetts. We 
will have other written questions for the record. I want to, 
again, thank each of the panelists for your excellent testimony 
and participation. We will be in touch.
    This hearing is adjourned.
    [Whereupon, at 3:44 p.m., the subcommittee was adjourned.]
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