[Federal Register Volume 60, Number 130 (Friday, July 7, 1995)]
[Rules and Regulations]
[Pages 35335-35338]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-16755]



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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 70

[ND-001; FRL-5254-8]


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

AGENCY: Environmental Protection Agency (EPA).

ACTION: Final interim approval.

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

EFFECTIVE DATE: August 7, 1995.

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

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

SUPPLEMENTARY INFORMATION:

I. Background and Purpose

Introduction

    Title V of the 1990 Clean Air Act Amendments (sections 501-507 of 
the Clean Air Act (``the Act'')), and implementing regulations at 40 
Code of Federal Regulations (CFR) part 70 (part 70) require that States 
develop and submit operating permits programs to EPA by November 15, 
1993, and that EPA act to approve or disapprove each program within one 
year after receiving the submittal. The EPA's program review occurs 
pursuant to section 502 of the Act and the part 70 regulations, which 
together outline criteria for approval or disapproval. Where a program 
substantially, but not fully, meets the requirements of part 70, EPA 
may grant the program interim approval for a period of up to two years. 
If EPA has not fully approved a program by two years after the November 
15, 1993 date, or by the end of an interim program, it must establish 
and implement a Federal program.
    On April 28, 1995 EPA published a Federal Register notice proposing 
interim approval of the Operating Permits Program for the State of 
North Dakota. See 60 FR 20941. EPA received adverse comments on the 
proposed interim approval, which are addressed below, and is taking 
final action to promulgate interim approval of the North Dakota 
PROGRAM. 

[[Page 35336]]


II. Final Action and Implications

A. Analysis of State Submission

    The Governor of North Dakota submitted an administratively complete 
title V Operating Permit Program (PROGRAM) for the State of North 
Dakota on April 28, 1994. The North Dakota PROGRAM, including the 
operating permit regulations (Article 33-15, Section 33-15-14-06, of 
the North Dakota Administrative Code--Air Pollution Control Rules 
(NDAC)), substantially meets the requirements of 40 CFR 70.2 and 70.3 
with respect to applicability; Secs. 70.4, 70.5, and 70.6 with respect 
to permit content including operational flexibility; Sec. 70.5 with 
respect to complete application forms and criteria which define 
insignificant activities; Sec. 70.7 with respect to public 
participation and minor permit modifications; and Sec. 70.11 with 
respect to requirements for enforcement authority.
    EPA's comments noting deficiencies in the North Dakota PROGRAM were 
sent to the State in a letter dated December 22, 1994. The deficiencies 
were segregated into those that require corrective action prior to 
interim PROGRAM approval, and those that require corrective action 
prior to full PROGRAM approval. The State committed to address the 
PROGRAM deficiencies that require corrective action prior to interim 
PROGRAM approval in a letter dated January 5, 1995. The State submitted 
these corrective actions in letters dated February 22, March 20, and 
June 13, 1995. EPA has reviewed these corrective actions and has 
determined them to be adequate to allow for interim PROGRAM approval.
B. Response to Comments

    The comments received on the April 28, 1995 Federal Register notice 
proposing interim approval of the North Dakota PROGRAM, and EPA's 
response to those comments, are as follows:
    Comment #1: One commenter stated that they supported granting 
interim approval of the State's PROGRAM. However, the commenter also 
indicated a concern regarding EPA's requirement that the State lower 
proposed insignificant emission levels, listed in subsection 33-15-14-
06.4.c of the NDAC, to ``more reasonable'' levels prior to full PROGRAM 
approval. The commenter stated that, because the State's insignificant 
exemption is based on the emission rate, rather than size or production 
rate, and the regulation requires listing all emission units claiming 
the exemption in the permit application, subsection 33-15-14-06.4.c of 
the NDAC merely grants the applicant relief from additional 
administrative burdens imposed on major sources. The commenter urges 
EPA to reconsider its position when evaluating the PROGRAM for full 
approval.
    EPA Response: EPA does not consider this an adverse comment for 
granting interim approval of the State's PROGRAM. However, for full 
PROGRAM approval, EPA continues to believe that the insignificant 
emission levels that North Dakota set for the listed air contaminants 
(emission levels set at approximately 25% of the Prevention of 
Significant Deterioration (PSD) major modification significant levels) 
are too high to be considered reasonable levels for exempting those 
emission units from Title V operating permit requirements. A 
determination of what level of emissions is appropriate for these types 
of exemptions is best performed based on a consideration of the size of 
the emissions thresholds relative to the major source threshold 
applicable in various areas of North Dakota. Emissions of 25% of the 
PSD major modification significance levels are not clearly 
insignificant. Also, EPA is concerned that a source could have numerous 
emission units that emit less than the levels the State has set as 
insignificant and would subsequently be excluded from the majority of 
Title V permit requirements, even though the total emissions from all 
such insignificant emission units may be greater than the major 
modification significance levels or even greater than the major source 
threshold. Consequently, EPA continues to believe that the State must 
lower its insignificant emission levels for non-HAP units to a more 
reasonable level.
    Comment #2: One commenter stated that the North Dakota PROGRAM 
jurisdiction should be consistent with existing treaties, court 
decisions, applicable statutes, and Indian and non-Indian historical 
activity which may have a bearing on jurisdiction. The commenter 
referenced specific U.S. Supreme Court cases and indicated belief that 
State-tribal jurisdictional questions should be decided in federal 
court and not by EPA ``whose expertise is environmental and not 
jurisdictional.''
    EPA Response: Under Title V of the Act and the part 70 implementing 
regulations, it is incumbent upon EPA to determine whether a given 
State has the authority to implement a part 70 operating permits 
program for affected sources before granting approval of the State's 
PROGRAM. Specifically, the Act gives EPA regulatory authority ``to 
establish the minimum elements of a permit program to be administered 
by any air pollution control agency.'' See Sec. 502(b) of the Act. The 
Act further provides that these minimum elements must include ``[a] 
requirement that the permitting authority have adequate authority to * 
* * issue permits and assure compliance by all sources required to have 
a permit under [Title V] with each applicable standard, regulation or 
requirement under [the Act].'' See section 502(b)(5) of the Act; 40 CFR 
70.4(b)(3)(i).
    Because EPA has the responsibility to ensure that a State has 
adequate authority over sources affected by its Title V program, EPA 
must make judgments about the scope of a State's legal authority, 
including its jurisdictional reach over affected sources. EPA also has 
the responsibility to address whether Tribes may administer Clean Air 
Act programs and, if not, to establish other means by which EPA will 
directly administer such programs. See sections 301(d) and 110(o) of 
the Act; 59 FR 43956 (August 25, 1994).
    North Dakota has not specifically asserted jurisdiction over air 
pollution sources located within Indian Country in either its PROGRAM 
submittal or its comments on EPA's proposed interim approval. The 
Program Description that the State submitted to EPA as part of its 
PROGRAM specifically indicated that the State was not seeking approval 
to operate the PROGRAM on Indian Reservations. Thus, as EPA indicated 
in its notice of proposed interim approval, EPA is not presently 
deciding whether the State of North Dakota has jurisdiction over 
sources within Indian Country. Should North Dakota choose to seek 
PROGRAM approval over additional sources located in other areas, it may 
do so without prejudice. Any EPA decision regarding State or Tribal 
jurisdiction will necessarily be informed by relevant law, including 
the applicable provisions of the Act and implementing regulations, and 
other applicable Federal law.

C. Final Action

    The EPA is promulgating interim approval of the Operating Permits 
Program submitted by the State of North Dakota on April 28, 1994. The 
State must complete the following corrective actions to receive full 
PROGRAM approval: (1) The State must revise sub-section 33-15-14-06.4.c 
of the NDAC to lower the insignificant emissions unit threshold for 
criteria pollutants to more reasonable levels. (2) In order to 
implement sub-section 33-15-14-06.5.a.(1)(c) of the NDAC, the State 
must adopt specific provisions which detail 

[[Page 35337]]
how to determine that an alternative emission limit is equivalent to 
that in the SIP, and EPA must approve the provisions as part of the 
SIP. Until this can be accomplished, the State must delete the words 
``or this article'' from the first line of sub-section 33-15-14-
06.5.a.(1)(c) of the NDAC. (3) Sub-section 33-15-14-06.5.a.(11) of the 
NDAC must be revised to state that changes in emissions are allowed by 
this sub-section provided that they are not modifications under title I 
of the Act and the changes do not exceed the emissions allowed under 
the permit. (4) The State must revise sub-section 33-15-14-06.5.f.(1) 
of the NDAC to read ``* * * the department shall include in a title V 
permit to operate a provision stating that compliance with the 
conditions of the permit shall be deemed compliance with any applicable 
requirements as of the date of permit issuance * * *.'' (5) The State 
must delete ``or this article'' from sub-section 33-15-14-06.5.a.(8) of 
the NDAC, and ``this article'' from sub-sections 33-15-14-06.5.a.(10) 
and 33-15-14-06.6.e.(1)(a)[2] of the NDAC to clarify that, in order to 
implement these provisions, the State must have an economic incentives, 
marketable permits or generic emissions trading program approved in its 
SIP. (6) The Attorney General's opinion, that was part of the PROGRAM 
submittal, does not cite to relevant State laws or regulations or to 
State case law, and, instead of discussing the provisions of North 
Dakota laws, largely discusses Federal regulations. The opinion should 
discuss and reference North Dakota law which ensures that the 
provisions for judicial review in North Dakota Century Code (N.D.C.C.) 
Chapter 28-23-14 and 15 and in NDAC Article 33-22 are the exclusive 
means for obtaining judicial review of the terms and conditions of 
permits and that petitions for judicial review must be filed within the 
90-day periods discussed in 40 CFR 70.4(b)(3)(xii). The State must 
augment the Attorney General's opinion, providing discussion of and 
citation to case law, statutes, and regulations which address the 
requirements of 40 CFR 70.4(b)(3)(xii), or, if such an opinion cannot 
be rendered, the State must change its statutes and/or regulations to 
ensure that the requirements of 40 CFR 70.4(b)(3)(xii) are met. (7) The 
State must augment the Attorney General's opinion, providing discussion 
of and citation to case law and/or specific statutory or regulatory 
provisions which provide for judicial review in cases of State 
inaction, consistent with the requirements of 40 CFR 70.4(b)(3)(xi), 
or, if such an opinion cannot be rendered, the State must change its 
statutes and/or regulations to ensure that the requirements of 40 CFR 
70.4(b)(3)(xi) are met. (8) The Attorney General's opinion states that 
State law provides civil and criminal enforcement authority consistent 
with 40 CFR 70.11. EPA was unable to determine from the opinion whether 
North Dakota's PROGRAM is consistent in all respects with 40 CFR 70.11, 
and in particular with the requirement for maximum fines of not less 
than $10,000 per day per violation. The State must augment the opinion, 
providing citation to and discussion of case law indicating that the 
PROGRAM meets the penalty requirements contained in 40 CFR 70.11, or, 
if such an opinion cannot be rendered, the State must change its 
statutes and/or regulations to ensure that the requirements of 40 CFR 
70.11 are met.
    Evidence of these corrective actions for full PROGRAM approval must 
be submitted to EPA within 18 months of EPA's interim approval of the 
North Dakota PROGRAM.
    Refer to the technical support document accompanying this 
rulemaking for a detailed explanation of these PROGRAM deficiencies and 
the required corrective actions.
    The scope of North Dakota's PROGRAM that EPA is approving in this 
notice would apply to all part 70 sources (as defined in the PROGRAM) 
within the State, except the following: any sources of air pollution 
located in ``Indian Country,'' as defined in 18 U.S.C. 1151, including 
the Fort Berthold, Fort Totten, Standing Rock, Sisseton and Turtle 
Mountain Indian Reservations, or any other sources of air pollution 
over which an Indian Tribe has jurisdiction. See, e.g., 59 FR 55813, 
55815-55818 (Nov. 9, 1994). The term ``Indian Tribe'' is defined under 
the Act as ``any Indian Tribe, band, nation, or other organized group 
or community, including any Alaska Native village, which is Federally 
recognized as eligible for the special programs and services provided 
by the United States to Indians because of their status as Indians.'' 
See section 302(r) of the CAA; see also 59 FR 43955, 43962 (Aug. 25, 
1994); 58 FR 54364 (Oct. 21, 1993).
    In proposing not to extend the scope of North Dakota's PROGRAM to 
sources located in ``Indian Country,'' EPA is not making a 
determination that the State either has adequate jurisdiction or lacks 
jurisdiction over such sources. Should the State of North Dakota choose 
to seek PROGRAM approval within ``Indian Country,'' it may do so 
without prejudice. Before EPA would approve the State's PROGRAM for any 
portion of ``Indian Country,'' EPA would have to be satisfied that the 
State has authority, either pursuant to explicit Congressional 
authorization or applicable principles of Federal Indian law, to 
enforce its laws against existing and potential pollution sources 
within any geographical area for which it seeks program approval, that 
such approval would constitute sound administrative practice, and that 
those sources are not subject to the jurisdiction of any Indian Tribe.
    This interim PROGRAM approval, which may not be renewed, extends 
until August 7, 1997. During this interim approval period, the State of 
North Dakota is protected from sanctions, and EPA is not obligated to 
promulgate, administer and enforce a Federal operating permits program 
in the State of North Dakota. Permits issued under a program with 
interim approval have full standing with respect to part 70, and the 
one year time period for submittal of permit applications by subject 
sources begins upon the effective date of this interim approval, as 
does the three year time period for processing the initial permit 
applications.
    If the State of North Dakota fails to submit a complete corrective 
PROGRAM for full approval by February 7, 1997, EPA will start an 18-
month clock for mandatory sanctions. If the State of North Dakota then 
fails to submit a corrective PROGRAM that EPA finds complete before the 
expiration of that 18-month period, EPA will be required to apply one 
of the sanctions in section 179(b) of the Act, which will remain in 
effect until EPA determines that the State of North Dakota has 
corrected the deficiency by submitting a complete corrective PROGRAM. 
Moreover, if the Administrator finds a lack of good faith on the part 
of the State of North Dakota, both sanctions under section 179(b) will 
apply after the expiration of the 18-month period until the 
Administrator determines that the State of North Dakota has come into 
compliance. In any case, if, six months after application of the first 
sanction, the State of North Dakota still has not submitted a 
corrective PROGRAM that EPA has found complete, a second sanction will 
be required.
    If EPA disapproves the State of North Dakota's complete corrective 
PROGRAM, EPA will be required to apply one of the section 179(b) 
sanctions on the date 18 months after the effective date of the 
disapproval, unless prior to that date the State of North Dakota has 
submitted a revised PROGRAM and EPA has determined 

[[Page 35338]]
that it corrected the deficiencies that prompted the disapproval. 
Moreover, if the Administrator finds a lack of good faith on the part 
of the State of North Dakota, both sanctions under section 179(b) shall 
apply after the expiration of the 18-month period until the 
Administrator determines that the State of North Dakota has come into 
compliance. In all cases, if, six months after EPA applies the first 
sanction, the State of North Dakota has not submitted a revised PROGRAM 
that EPA has determined corrects the deficiencies, a second sanction is 
required.
    In addition, discretionary sanctions may be applied where warranted 
any time after the expiration of an interim approval period if the 
State of North Dakota has not timely submitted a complete corrective 
PROGRAM or EPA has disapproved its submitted corrective PROGRAM. 
Moreover, if EPA has not granted full approval to the North Dakota 
PROGRAM by the expiration of this interim approval and that expiration 
occurs after November 15, 1995, EPA must promulgate, administer and 
enforce a Federal permits program for the State of North Dakota upon 
interim approval expiration.
    Requirements for approval, specified in 40 CFR 70.4(b), encompass 
section 112(l)(5) requirements for approval of a program for delegation 
of section 112 standards as promulgated by EPA as they apply to part 70 
and non-part 70 sources. Section 112(l)(5) requires that the State's 
program contain adequate authorities, adequate resources for 
implementation, and an expeditious compliance schedule, which are also 
requirements under part 70. Therefore, the EPA is promulgating approval 
under section 112(l)(5) and 40 CFR 63.91 of the State's PROGRAM for 
receiving delegation of section 112 standards that are unchanged from 
Federal standards as promulgated. This program for delegations applies 
to sources covered by the part 70 program, as well as non-part 70 
sources.
    EPA is also finalizing its approval of North Dakota's construction 
permitting program found in section 33-15-14-02 of the State's 
regulations under the authority of title V and part 70 solely for the 
purpose of implementing section 112(g) during the transition period, 
discussed in section II.A.4.b. of the notice proposing interim approval 
of the North Dakota PROGRAM, to meet the requirements of section 
112(g). Since the approval would be for the single purpose of providing 
a mechanism to implement section 112(g) during the transition period, 
the approval would be without effect if EPA decides in the final 
section 112(g) rule that sources are not subject to the requirements of 
the rule until State regulations are adopted. Also, since the approval 
would be for the limited purpose of allowing the State sufficient time 
to adopt regulations, EPA is limiting the duration of the approval to 
12 months following promulgation by EPA of its section 112(g) rule. 
North Dakota's construction permitting program allows permit 
requirements to be established for all air contaminants (which is 
defined in section 33-15-01-04 of the NDAC and includes all of the 
hazardous air pollutants (HAPs) listed in section 112(b) of the Act).

III. Administrative Requirements

A. Docket

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

B. Executive Order 12866

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

C. Regulatory Flexibility Act

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

List of Subjects in 40 CFR Part 70

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

    Dated: June 26, 1995.
Jack W. McGraw,
Acting Regional Administrator.

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

PART 70--[AMENDED]

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

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

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

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

* * * * *

North Dakota

    (a) North Dakota State Department of Health and Consolidated 
Laboratories--Environmental Health Section: submitted on May 11, 1994; 
effective on August 7, 1995; interim approval expires August 7, 1997.
    (b) [Reserved].

[FR Doc. 95-16755 Filed 7-6-95; 8:45 am]
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