[Federal Register Volume 60, Number 137 (Tuesday, July 18, 1995)]
[Rules and Regulations]
[Pages 36715-36722]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-17212]



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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[MT25-1-6541a; FRL-5251-8]


Approval and Promulgation of Air Quality Implementation Plans; 
Montana

AGENCY: Environmental Protection Agency (EPA).

ACTION: Direct final rule.

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SUMMARY: EPA is acting on revisions to the State Implementation Plan 
(SIP) submitted by the Governor of Montana on May 17, 1994. The 
submittal included, among other things, revisions to the State's 
construction permitting regulations to comply with Federal requirements 
and revisions to address outstanding rule deficiencies, as well as a 
request that the existing regulations in the SIP be replaced with the 
October 1979 recodification of the Administrative Rules of Montana 
(ARM). EPA is approving all of the regulations included in this 
submittal, with the exception of the two director's discretion 
provisions regarding hydrocarbon emissions which EPA is disapproving, 
the odor control rules and the sulfur oxide rules for lead smelters on 
which EPA is taking no action, and the variance provisions which EPA 
will be acting on in a separate notice. Also, EPA is not approving the 
submitted versions of two provisions of the State's open burning rules 
which EPA previously disapproved. The previously-approved versions of 
these rules remain part of the SIP. In addition, EPA is only partially 
approving the State's nonattainment permitting rules for the Kalispell 
PM-10 nonattainment area. Last, EPA is approving Montana's construction 
permit rules for sources of hazardous air pollutants under section 
112(l) of the Clean Air Act.

DATES: This final rule is effective on September 18, 1995, unless 
adverse or critical comments are received by August 17, 1995. If the 
effective date is delayed, timely notice will be published in the 
Federal Register.

ADDRESSES: Copies of the State's submittal and other relevant 
information are available for inspection during normal business hours 
at the following locations: Air Programs Branch, U.S. Environmental 
Protection Agency, Region VIII, 999 18th Street, suite 500, Denver, 
Colorado 80202-2466; and Air Quality Division, Montana Department of 
Health and Environmental Sciences, P.O. Box 200901, Cogswell Building, 
Helena, Montana 59620-0901.

FOR FURTHER INFORMATION CONTACT: Vicki Stamper, 8ART-AP, U.S. 
Environmental Protection Agency, Region VIII, 999 18th Street, suite 
500, Denver, Colorado 80202-2466, (303) 293-1765.

SUPPLEMENTARY INFORMATION:

I. Background

    On May 17, 1994, the Governor of Montana submitted comprehensive 
revisions to the Montana SIP. Specifically, the submittal included the 
following revisions to the State's regulations:
    (1) Revisions to the nonattainment new source review (NSR) 
permitting program by the addition of new ARM 16.8.1701-1705 and 
16.8.1801-1806 to meet the requirements of 40 CFR 51.165 and the 
amended Clean Air Act (Act), as required for all of the State's 
nonattainment areas;
    (2) Revisions to the prevention of significant deterioration (PSD) 
permitting program in ARM 16.8.945-963 to bring the State's PSD rules 
up to date with the Federal PSD requirements in 40 CFR 51.166 and with 
some of the new requirements of the amended Act;
    (3) Revisions to the general NSR permitting requirements in ARM 
16.8.1101-1120 to address outstanding EPA concerns and to reflect the 
major source preconstruction permitting requirements in subchapters 9, 
17, and 18 of title 16, chapter 8 of the ARM;
    (4) Revisions to address commitments in Montana's PM-10 SIPs 
including, among other things, revisions to: (1) The State's NSR rules 
as discussed above; (2) the source testing requirements in ARM 
16.8.708-709; (3) the New Source Performance Standards (NSPS) in ARM 
16.8.1423; and (4) the National Emission Standards for Hazardous Air 
Pollutants (NESHAPs) in ARM 16.8.1424;
    (5) Revisions to the wood waste burner emission rule in ARM 
16.8.1407 to address EPA's December 4, 1992 disapproval of the previous 
revision to this rule (see 57 FR 57345);
    (6) Revisions to the general definitions for Montana's air program 
rules in ARM 16.8.701; and
    (7) Miscellaneous revisions to other source-category emission 
control rules in ARM 16.8.1401, 1425, and 1427-1428.
    Also as part of this submittal, the State submitted the entire 
State air quality rules which were recodified in October of 1979 to be 
incorporated into the SIP. Although the State recodified its rules in 
1979, the State never formally submitted the recodified rules to 
replace the existing rules approved by EPA in the SIP. Only rules to 
which revisions were made after 1979 have been submitted to EPA and 
approved in the SIP. Therefore, in this submittal, the State submitted 
its entire air quality regulations to be incorporated into the SIP and 
to replace the existing State rules approved in the SIP.

A. Nonattainment NSR and PSD Requirements of the Act

    The air quality planning requirements for nonattainment NSR are set 
out in part D of title I of the Act. The EPA has issued a ``General 
Preamble'' describing EPA's preliminary views on how EPA intends to 
review SIPs and SIP revisions submitted under part D, including those 
State submittals containing nonattainment area NSR SIP requirements 
(see 57 FR 13498 (April 16, 1992) and 57 FR 18070 (April 28, 1992)). 
Because EPA is describing its interpretations here only in broad terms, 
the reader should refer to the General Preamble for a more detailed 
discussion of the interpretations of part D advanced in this notice and 
the supporting rationale. A brief discussion of the specific elements 
required in a State's nonattainment NSR program is also included in 
Section II.B. of this document.
    EPA is currently developing rule revisions to implement the changes 
under the 1990 Clean Air Act Amendments (1990 Amendments) in the NSR 
provisions of parts C and D of title I of the Act. The EPA anticipates 

[[Page 36716]]
that the proposed rule will be published for public comment in the near 
future. If EPA has not taken final action on States' NSR submittals by 
that time, EPA may generally refer to the proposed rule as the most 
authoritative guidance available regarding the approvability of the 
submittals. EPA expects to take final action to promulgate the rule 
revisions to implement the part C and D changes sometime during 1996. 
Upon promulgation of those revised regulations, EPA will review NSR 
SIPs to determine whether additional SIP revisions are necessary to 
satisfy the requirements of the rulemaking.
    Prior to EPA approval of a State's NSR SIP submission, the State 
may continue permitting only in accordance with the new statutory 
requirements for permit applications completed after the relevant SIP 
submittal date. This policy was explained in transition guidance 
memoranda from John Seitz dated March 11, 1991 and September 3, 1992.
    As explained in the March 11 memorandum, EPA does not believe 
Congress intended to mandate the more stringent title I NSR 
requirements during the time provided for SIP development. States were 
thus allowed to continue to issue permits consistent with requirements 
in their current NSR SIPs during that period, or to apply 40 CFR part 
51, appendix S for newly designated areas that did not previously have 
NSR SIP requirements.
    The September 3, 1992 memorandum also addressed the situation where 
States did not submit the part D NSR SIP revisions by the applicable 
statutory deadline. For permit applications complete by the SIP 
submittal deadline, States may issue final permits under the prior NSR 
rules, assuming certain conditions in the September 3 memorandum are 
met. However, for applications completed after the SIP submittal 
deadline, EPA will consider the source to be in compliance with the Act 
where the source obtains from the State a permit that is consistent 
with the substantive new NSR part D provisions in the amended Act. EPA 
believes this guidance continues to apply to permitting pending final 
action on Montana's NSR SIP submittal.
    For further information on the NSR and PSD requirements of the 
amended Act, see the Technical Support Document (TSD) accompanying this 
document.

B. Outstanding Rule Deficiencies

    Prior to enactment of the 1990 Amendments, EPA had identified 
numerous deficiencies in the State's PSD and nonattainment NSR rules in 
subchapters 9 and 11 of the State's air quality rules. Note that 
subchapter 11 previously contained the State's nonattainment NSR rules 
as well as its general construction permit rules. As part of the PM-10 
SIP submittals, the State committed, among other things, to correct 
these deficiencies in its NSR and PSD rules as well as to address all 
of the new NSR requirements of the amended Act. The State's May 1994 
submittal was intended to address all major NSR/PSD deficiencies and 
inconsistencies with the Federal requirements.
    In order to address EPA's concerns, as well as to address the new 
NSR requirements of the amended Act, the State revised subchapters 9 
and 11 and adopted new subchapters 17 and 18. Specifically, the State's 
PSD permitting rules in subchapter 9 were revised to conform with the 
existing Federal PSD rules in 40 CFR 51.166 and with the amended Act. 
New subchapter 17 includes the nonattainment NSR rules and was written 
to conform with the existing Federal nonattainment NSR rules in 40 CFR 
51.165 and the amended Act. New subchapter 18 includes the permitting 
requirements for new and modified major stationary sources locating in 
attainment areas but which cause or contribute to a violation of the 
National Ambient Air Quality Standards (NAAQS).
    Also as part of the PM-10 SIP submittals, the State committed to 
correct other deficiencies in the Statewide SIP. Specifically, the 
State committed to adopt regulations which specify 40 CFR part 51, 
appendix M, Methods 201, 201A, and 202 as required test methods for the 
determination of PM-10 emissions, correct its wood waste burner rule in 
ARM 16.8.1407 to address EPA's December 2, 1992 disapproval of this 
rule (57 FR 57345), and revise its NSPS and NESHAPs in ARM 16.8.1423 
and 1424 to incorporate all Federal requirements promulgated through 
July 1, 1992.
    For further information on the outstanding deficiencies with these 
rules, see the TSD accompanying this notice.

C. State-Initiated Revisions

    In addition to the revisions mentioned above, the State also made 
other regulatory revisions in this submittal. Those revisions included: 
(1) Changes resulting from the State's substantial revisions to its PSD 
and NSR permitting regulations, and new statutory authority from the 
State's 1993 Legislature; (2) a restructuring of the State's emission 
control rules in subchapter 14; (3) the addition of some director's 
discretion provisions in the State's hydrocarbon emission rule in ARM 
16.8.1425 and the State's odor control rule in ARM 16.8.1427; and (4) 
other minor revisions for clarity. For further details, see the TSD.

II. Analysis of State Submission

    Section 110(k) of the Act sets out provisions governing EPA's 
review of SIP submittals (see 57 FR 13565-13566).

A. Procedural Background
    The Act requires States to observe certain procedural requirements 
in developing implementation plans and plan revisions for submission to 
EPA. Section 110(a)(2) of the Act provides that each implementation 
plan submitted by a State must be adopted after reasonable notice and 
public hearing.1 Section 110(l) of the Act similarly provides that 
each revision to an implementation plan submitted by a State under the 
Act must be adopted by such State after reasonable notice and public 
hearing.

    \1\ Section 172(c)(7) of the Act provides that plan provisions 
for nonattainment areas shall meet the applicable provisions of 
Section 110(a)(2).
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    The EPA also must determine whether a submittal is complete and 
therefore warrants further EPA review and action [see section 110(k)(1) 
and 57 FR 13565, April 16, 1992]. The EPA's completeness criteria for 
SIP submittals are set out at 40 CFR part 51, appendix V. The EPA 
attempts to make completeness determinations within 60 days of 
receiving a submission. However, a submittal is deemed complete by 
operation of law under section 110(k)(a)(B) if a completeness 
determination is not made by EPA within 6 months after receipt of the 
submission.
    The State of Montana held public hearings on July 16, 1993, 
September 17, 1993, and November 19, 1993 to entertain public comment 
on these various SIP revisions. Following the public hearings, the 
revisions to subchapter 14 were adopted on September 17, 1993, and all 
of the other regulatory revisions were adopted on November 19, 1993. 
These rule revisions were formally submitted to EPA for approval on May 
17, 1994.
    The SIP revisions were reviewed by EPA to determine completeness 
shortly after their submittal, in accordance with the completeness 
criteria referenced above. The submittal was found to be complete, and 
a letter dated July 13, 1994 was forwarded to the Governor indicating 
the completeness of the submittal and the next steps to be taken in the 
processing of the SIP submittal. 

[[Page 36717]]


B. Review of Submittal for Meeting the Nonattainment NSR and PSD 
Requirements of the Amended Act

1. General Nonattainment NSR Requirements
    The general statutory requirements for nonattainment NSR permitting 
as amended by the 1990 Amendments are found in sections 172 and 173 of 
the Act. These requirements apply in all nonattainment areas. The 
State's nonattainment NSR rules are generally found in subchapter 17 of 
the ARM. The following represents EPA's review of the State's rules in 
meeting the NSR requirements of the Act:
    (a) The amended Act repealed the construction ban provisions 
previously found in section 110(a)(2)(I) with certain exceptions. No 
construction bans are currently imposed in Montana, so this requirement 
is inapplicable.
    (b) Section 173(a)(1)(A) of the Act requires a demonstration for 
permit issuance that the new source growth does not interfere with 
reasonable further progress (RFP) for the area. Also, calculations of 
emissions offsets must be based on the same emissions baseline used in 
the RFP demonstration. In ARM 16.8.1704(1)(c)(iii), the State has 
established provisions which address section 173(a)(1).
    (c) Section 173(c)(1) of the Act requires that offsets must 
generally be obtained by the same source or other sources in the same 
nonattainment area. However, offsets may be obtained from sources in 
other nonattainment areas if: the area in which the offsets are 
obtained has an equal or higher nonattainment classification; and 
emissions from the nonattainment area in which the offsets are obtained 
contribute to a NAAQS violation in the area in which the source would 
construct. In ARM 16.8.1705(7), the State has established provisions 
that meet the requirements of section 173(c)(1).
    (d) Section 173(c)(1) of the Act requires that any emissions 
offsets obtained in conjunction with the issuance of a permit to a new 
or modified source must be in effect and enforceable by the time the 
new or modified source commences operation. In ARM 16.8.1704(1)(c)(v) 
and (1)(d) and 16.8.1705(6), the State has established provisions that 
meet the requirements of section 173(c)(1).
    (e) Section 173(c)(1) of the Act requires that emissions increases 
from new or modified major stationary sources are offset by real 
reductions in actual emissions. In ARM 16.8.1704(1)(c) and 
16.8.1705(1), the State has established provisions that meet the 
requirements of section 173(c)(1).
    (f) Section 173(c)(2) of the Act prohibits emissions reductions 
otherwise required by the Act from being credited for purposes of 
satisfying the part D offset requirements. In ARM 16.8.1705(12), the 
State has established provisions that meet the requirements of section 
173(c)(2).
    (g) Section 173(a)(3) provides that, as a condition of permit 
issuance, states must require the owner or operator of a proposed new 
or modified source to demonstrate that all major stationary sources 
under the same ownership or control are in compliance or are on a 
schedule for compliance with all applicable emission limitations and 
standards. In ARM 16.8.1704(1)(b), the State has established provisions 
that meet the requirements of section 173(a)(3).
    (h) Section 173(a)(2) requires a new or modified major stationary 
source to comply with the lowest achievable emission rate (LAER). In 
ARM 16.8.1704(1)(a), the State has established provisions that address 
section 173(a)(2).
    (i) Revised sections 172(c)(4), 173(a)(1)(B), and 173(b) of the Act 
limit and invalidate use of certain growth allowances in nonattainment 
areas. In ARM 16.8.1704(2), the State has adopted a provision 
invalidating any existing growth allowances in a nonattainment area 
that received a notice prior to the 1990 Amendments that the SIP was 
substantially inadequate or that receives such a notice of inadequacy 
under section 110(k) in the future, consistent with the requirements of 
section 173(b). Further, the State has no formally targeted economic 
growth areas in which growth allowances would be allowed per sections 
172(c)(4) and 173(a)(1)(B) of the Act.
    (j) Revised section 173(a)(5) of the Act requires that, as a 
prerequisite to issuing any part D permit, an analysis of alternative 
sites, sizes, production processes, and environmental control 
techniques for a proposed source be completed which demonstrates that 
the benefits of the proposed source significantly outweigh the 
environmental and social costs imposed as a result of its location, 
construction, or modification. In ARM 16.8.1704(1)(e), the State has 
established provisions which address section 173(a)(5).
    (k) Section 173(d) of the Act requires States to submit control 
technology information from permits to EPA for the purposes of making 
such information available through the RACT/BACT/LAER clearinghouse. 
Montana and EPA have established provisions in the annual State-EPA 
agreement requiring the State to submit information from nonattainment 
NSR permits to EPA's RACT/BACT/LAER clearinghouse, which EPA believes 
is adequate to meet this requirement.
    (l) Revised section 302(z) of the Act sets forth a new definition 
of ``stationary source'' reflecting Congressional intent that certain 
stationary internal combustion engines are subject to State regulation 
under stationary source permitting programs, while certain ``nonroad 
engines,'' defined in section 216(10), are generally excluded. On June 
17, 1994, the EPA published regulations in 40 CFR Part 89 regarding new 
nonroad engines and vehicles, including a definition of nonroad engine 
(59 FR 31306). EPA's action to approve this SIP revision is limited in 
that it does not include the regulation of nonroad engines in a manner 
inconsistent with section 209 of the Act and EPA regulations 
implementing section 209.
2. Nonattainment Area-Specific NSR Requirements
    In addition to all of the general nonattainment NSR provisions 
mentioned above, there are also nonattainment area-specific NSR 
provisions in subparts 2, 3, and 4 of part D of the Act, some of which 
supersede these general NSR provisions because they are more stringent. 
The following provisions are the additional NSR provisions that apply 
in Montana's nonattainment areas and represent EPA's review of the 
State's regulation in meeting these requirements:
    (a) Carbon Monoxide Nonattainment Areas. The State of Montana has 
three carbon monoxide (CO) nonattainment areas: the Billings area and 
the Great Falls area, both currently not classified, and Missoula, 
currently classified moderate with a design value less than 12.7 parts 
per million (ppm).
    For both not classified and moderate CO nonattainment areas, States 
must submit the following NSR provisions, in addition to provisions 
meeting the general NSR requirements in sections 172 and 173 of the Act 
discussed above: A definition of the term ``major stationary source'' 
that reflects the section 302(j) 100 tons per year (tpy) CO threshold 
and a 100 tpy significance level for defining major modifications of 
CO, consistent with the significance level in 40 CFR 51.165(a)(1)(x).
    In the definition of ``major stationary source'' in ARM 
16.8.1701(12)(a)(i), the State has established a 100 tpy threshold for 
sources of CO. In addition, the State has established a 100 tpy 
significance threshold for CO in the 

[[Page 36718]]
definition of ``significant'' in ARM 16.8.1701(18). Therefore, EPA 
finds that the State's NSR rules meet the requirements for all of its 
CO nonattainment areas.
    (b) PM-10 Nonattainment Areas. The State of Montana has seven PM-10 
nonattainment areas, all of which are currently classified as moderate. 
These areas include the cities of Libby, Missoula, Columbia Falls, 
Kalispell, Butte, Thompson Falls, and Whitefish. The State was required 
to submit the nonattainment NSR rules for all of these areas, except 
the Whitefish and Thompson Falls areas, by June 30, 1992. For the 
Whitefish and Thompson Falls PM-10 nonattainment areas whose 
nonattainment designation was not effective until November 18, 1993 and 
January 20, 1994, respectively, the State has eighteen months after the 
date of redesignation (or until May 18, 1995 and July 20, 1995, 
respectively) to submit the PM-10 attainment plans for the areas which 
must include, among other things, provisions meeting the NSR 
requirements of part D (see section 189(a)(2)(B) of the Act).
    For moderate PM-10 nonattainment areas, States must submit the 
following NSR provisions, in addition to provisions meeting the general 
NSR requirements in sections 172 and 173 of the Act discussed above:
    (1) A definition of ``major stationary source'' that reflects the 
section 302(j) 100 tpy PM-10 threshold and a 15 tpy significance level 
defining major modifications of PM-10, consistent with the significance 
level in 40 CFR part 51.
    (2) Section 189(e) of subpart 4 of part D of the amended Act 
requires that the control requirements applicable to major stationary 
sources of PM-10 must also apply to major stationary sources of PM-10 
precursors, except where the Administrator of EPA has determined that 
such sources do not contribute significantly to PM-10 levels which 
exceed the standard in the area. PM-10 precursors may include volatile 
organic compounds (VOCs) which form secondary organic compounds, sulfur 
dioxide (SO2) which forms sulfate compounds, and oxides of 
nitrogen (NOX) which form nitrate compounds. Thus, unless the EPA 
Administrator finds otherwise, States must submit rules for PM-10 
precursors meeting all of the NSR provisions mentioned above, including 
the section 302(j) 100 tpy threshold for defining major stationary 
sources and the current significance level thresholds in 40 CFR 
51.165(a)(1)(x) for each PM-10 precursor pollutant for defining major 
modifications.
    In the definition of ``major stationary source'' in ARM 
16.8.1701(12)(a)(i), the State has established a 100 tpy threshold for 
any source of PM-10 located in a PM-10 nonattainment area. In ARM 
16.8.1701(12)(a)(ii), the State has established a 70 tpy threshold for 
defining major stationary sources of PM-10 locating in serious PM-10 
nonattainment areas, in the event that one of the State's PM-10 
nonattainment areas is classified as serious at some point. The State 
has also established a 15 tpy significance level for PM-10 in the 
definition of ``significant'' in ARM 16.8.1701(18).
    EPA plans to make findings of whether major stationary sources of 
PM-10 precursors contribute significantly to PM-10 levels in excess of 
the NAAQS (and thus whether the requirements of section 189(e) apply) 
concurrent with EPA's action on the State's PM-10 SIP submittals.2 
As of the date of this document, EPA has promulgated findings that such 
sources of PM-10 precursors do not contribute significantly to PM-10 
exceedances in the Missoula, Butte, Columbia Falls, and Libby PM-10 
nonattainment areas (see, respectively, 59 FR 2539 (January 18, 1994), 
59 FR 11552 (March 11, 1994), 59 FR 17702 (April 14, 1994), and 59 FR 
44630 (August 30, 1994)). However, EPA has not yet proposed or 
promulgated a finding that such sources of PM-10 precursors do not 
contribute significantly in the Kalispell area.

    \2\ Note that EPA's findings are based on the current character 
of an area including, for example, the existing mix of sources in an 
area. It is possible, therefore, that future growth could change the 
significance of precursors in an area.
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    Until EPA promulgates such a finding for the Kalispell PM-10 
nonattainment area, the State is required to adopt NSR provisions 
meeting the requirements of section 189(e) for this PM-10 nonattainment 
area. Because the State has not yet submitted these NSR provisions, EPA 
is only partially approving the State's nonattainment NSR submittal. If 
EPA promulgates a finding that such sources of PM-10 precursors do not 
contribute significantly in the Kalispell area, then the State's 
nonattainment NSR program will be considered to be fully approved as 
meeting all of the nonattainment NSR requirements of the amended Act. 
If EPA does not promulgate such a finding or if the State fails to 
timely submit PM-10 precursor NSR rules, then EPA will promulgate the 
partial disapproval that is the companion of this partial approval.
    Since the State is not required to submit NSR provisions for the 
Whitefish and Thompson Falls PM-10 nonattainment areas until May 18, 
1995 and July 20, 1995, respectively, EPA will determine the 
approvability of the State's NSR provisions for those nonattainment 
areas when EPA takes action on the attainment plans for those areas.
    Thus, EPA finds that the State's NSR program meets all of the 
requirements for the Butte, Columbia Falls, Libby and Missoula PM-10 
nonattainment areas, and EPA finds that the State has only partially 
met the nonattainment NSR requirements for the Kalispell PM-10 
nonattainment area.
    (c) Sulfur Dioxide Nonattainment Areas. The State of Montana has 
two SO2 nonattainment areas, which are defined as the Laurel area 
and the East Helena area. For SO2 nonattainment areas, States must 
submit the following NSR provisions, in addition to provisions meeting 
the general NSR requirements in sections 172 and 173 of the Act 
discussed above:
    A definition of ``major stationary source'' that reflects the 
section 302(j) 100 tpy SO2 and a 40 tpy significance level for 
defining major modifications of SO2, consistent with the 
significance level in 40 CFR 51.165(a)(1)(x).
    In the definition of ``major stationary source'' in ARM 
16.8.1701(12)(a)(1), the State has established a 100 tpy threshold for 
SO2. In addition, the State has established a 40 tpy significance 
threshold for SO2 in the definition of ``significant'' in ARM 
16.8.1701(18). Therefore, EPA finds that the State's NSR rules meet the 
requirements for all of its SO2 nonattainment areas.
    (d) Lead Nonattainment Areas. The State of Montana has one lead 
nonattainment area, which is defined as the East Helena area. For lead 
nonattainment areas, States must submit the following NSR provisions, 
in addition to provisions meeting the general NSR requirements in 
sections 172 and 173 of the Act discussed above:
    A definition of ``major stationary source'' that reflects the 
section 302(j) 100 tpy lead and a 0.6 tpy significance level for 
defining major modifications of lead, consistent with the significance 
level in 40 CFR 51.165(a)(1)(x).
    In the definition of ``major stationary source'' in ARM 
16.8.1701(12)(a)(1), the State has established a 100 tpy threshold for 
lead. In addition, the State has established a 0.6 tpy significance 
threshold for lead in the definition of ``significant'' in ARM 
16.8.1701(18). Therefore, EPA finds that the State's NSR rules meets 
the requirements for its lead nonattainment area.
    For further information on these requirements and the State's 
provisions which meet these requirements, please 

[[Page 36719]]
see the TSD accompanying this document.
3. Montana's PSD Revisions Due to the Amended Act
    In its revisions to its PSD regulations, the State addressed one 
new requirement of the amended Act pertaining to hazardous air 
pollutants (HAPs). Prior to the 1990 Amendments, section 112 HAPs were 
regulated both under PSD permitting and the NESHAPs, in addition to any 
other applicable State or Federal rules. A new source or modification 
that was considered to be major for any pollutant was subject to PSD 
permitting requirements, including BACT, for every pollutant subject to 
regulation under the Act that was emitted by the source in significant 
quantities. Section 112(b)(6) of the amended Act eliminates PSD 
applicability of the HAPs listed in section 112. Thus, new and modified 
sources subject to PSD permitting are no longer required to apply BACT 
and other PSD requirements to all HAPs emitted in significant amounts. 
There is one exception to this exemption from PSD requirements: Any 
HAPs which are regulated as constituents of a more general pollutant 
listed under section 108 of the Act are still subject to PSD as part of 
the more general pollutant, despite the exemption described above. This 
includes pollutants such as VOCs, PM-10, and elemental lead. (See 57 FR 
18075, April 29, 1992.)
    The State made numerous revisions to its PSD rules in subchapter 9 
to clarify that HAPs are no longer regulated under PSD except to the 
extent that such HAPs are regulated as constituents of more general 
pollutants regulated under section 108 of the Act. EPA believes the 
State's PSD rule revisions regarding HAPs are consistent with the 
amended Act and, therefore, are approvable.

C. Outstanding Rule Deficiencies

    EPA's review of the State's revisions to its PSD permitting rules 
in subchapter 9 found that the State's revised rules are consistent 
with the Federal PSD permitting requirements in 40 CFR 51.166.
    EPA's review of the State's new subchapters 17 and 18, which 
contain the State's nonattainment NSR regulations, found that the 
State's rules are consistent with the corresponding Federal regulations 
in 40 CFR 51.165, as well as with the amended Act as discussed in 
Section II.B. above.
    Since the State now has separate permitting regulations for new and 
modified major sources locating in attainment or unclassified areas and 
nonattainment areas, subchapter 11 is now generally considered to be 
the State's general construction permit requirements. The corresponding 
Federal requirements that such programs must meet are found in 40 CFR 
51.160 through 51.164. EPA has reviewed the revised subchapter 11 and 
believes the State's general construction permit requirements 
adequately meet all of the Federal requirements in 40 CFR 51.160 
through 51.164. See the TSD for further details.
    Therefore, EPA believes the State has satisfied the commitment in 
its PM-10 SIPs to revise its construction permitting rules to address 
deficiencies previously identified by EPA.
    In ARM 16.8.709, the State adopted provisions requiring all 
emission source testing to be performed as specified in the applicable 
sampling method contained in the Federal regulations, including 40 CFR 
part 51, appendix M (which includes Methods 201, 201A, and 202 for 
determination of PM-10 emissions). Thus, the State has satisfied the 
commitment in its PM-10 SIPs to adopt regulations which specify 40 CFR 
part 51, appendix M, Methods 201, 201A, and 202 as required test 
methods for the determination of PM-10 emissions.
    The State also adequately addressed EPA's enforceability concerns 
with its wood waste burner rule in ARM 16.8.1407 by deleting the mass 
particulate emission limit which was not practicably enforceable at the 
tepee-style wood waste burners in the State. Therefore, EPA is 
approving the revised wood waste burner rule.
    Last, the State has satisfied the PM-10 SIP commitment to revise 
its NSPS and NESHAPs in ARM 16.8.1423 and 1424 to incorporate all 
Federal requirements promulgated through July 1, 1992.
    Thus, EPA believes this submittal satisfies all of the Statewide 
SIP deficiencies which the State committed to address in its PM-10 
SIPs, with the exception of the Kalispell PM-10 SIP commitment 
regarding NSR. Since the State's NSR rules are only being partially 
approved for the Kalispell PM-10 nonattainment area at this time, the 
State can only be considered to have partially met the PM-10 SIP 
commitment regarding NSR for this area.

D. Evaluation of the Other Regulations Included in the State's 
Submittal

    EPA believes that the other revisions to the State's regulations 
provide for clarity and consistency within the State's regulations and 
are consistent with any corresponding Federal requirements, with a few 
exceptions. One of those exceptions is the revisions to the hydrocarbon 
emission rule in ARM 16.8.1425. Specifically, the State revised this 
rule to allow the Montana Department of Health and Environmental 
Sciences, rather than the previously-required Administrator of EPA, to 
authorize use of other equipment that is equally efficient to that 
equipment required by this rule. Thus, the State's rule now permits the 
State to modify a specific control requirement of the SIP without 
requiring EPA review and approval of the alternative control equipment. 
Such a provision is generally termed a ``director's discretion'' 
provision, in that it allows the State discretionary authority to alter 
a provision of the SIP. EPA cannot legally approve such discretionary 
authority in States' SIPs without the State providing for some type of 
EPA review and approval of alternatives to the stated requirements in 
this regulation. Therefore, EPA is disapproving the revisions to ARM 
16.8.1425(1)(c) and (2)(d) which allow this discretion. If the State 
wishes to implement these provisions for a certain source allowing 
alternatives to the control equipment required in this rule, then the 
State must submit such alternatives to EPA for review and approval.
    In this submittal, as discussed at the beginning of this document, 
the State submitted the entire State air quality rules which were 
recodified in October of 1979 to be incorporated into the SIP and to 
replace any previous codifications of State rules currently approved as 
part of the SIP. EPA is therefore replacing the previously approved 
Montana rules with all of the rules included in the State's submittal, 
with the exception of the following:
    1. As discussed above, EPA is disapproving the director's 
discretion provisions in ARM 16.8.1425 (1)(c) and (2)(d);
    2. In this submittal, the State included the most current version 
of its open burning rules. However, on December 21, 1992, EPA 
disapproved revisions to ARM 16.8.1302 and 16.8.1307 which were 
submitted by the Governor on April 9, 1991 (see 57 FR 60485-60486 for 
further details). Therefore, EPA is not approving the current version 
of ARM 16.8.1302 and 16.8.1307. The previously approved version of ARM 
16.8.1302 and 16.8.1307, as in effect on April 16, 1982 and as approved 
by EPA on July 15, 1982 (47 FR 30763, 40 CFR 52.1370(c)(11)), remain 
part of the SIP;
    3. EPA believes it has no legal basis in the Act for approving the 
State's odor control rule in ARM 16.8.1427 and making it federally 
enforceable because 

[[Page 36720]]
odor control provisions are not generally related to attainment or 
maintenance of the NAAQS. Therefore, EPA is not taking action on ARM 
16.8.1427, and it is not considered part of the federally enforceable 
SIP;
    4. EPA is not taking action on the State's variance provision in 
ARM 16.8.101-102 at this time and will instead take action on this rule 
in a separate Federal Register notice; and
    5. EPA is not taking action on the State's sulfur oxide emission 
limits for lead or lead-zinc smelters in ARM 16.8.1414 because EPA has 
never previously approved this regulation into the SIP. Further, EPA 
understands that the State plans to repeal this regulation in the near 
future. See the TSD for further details.

III. Section 112(l) Approval

    In addition to approving Montana's construction permit program in 
ARM 16.8.1101-1120 as part of the SIP, EPA is also approving Montana's 
construction permit program for the regulation of HAPs under the 
authority provided in section 112(l) of the amended Act. Approval of 
the State's construction permit program under section 112(l) is 
necessary to allow the State to create federally enforceable limits on 
the potential to emit HAPs, because SIP approval of the State's 
construction permit rules only extends to the control of HAPs which are 
constituents of photochemically reactive organic compounds or 
particulate matter. Federally enforceable limits on photochemically 
reactive organic compounds or particulate matter may have the 
incidental effect of limiting certain HAPs. As a legal matter, no 
additional program approval by the EPA is required in order for those 
``criteria'' pollutant limits to be recognized as federally 
enforceable. However, section 112 of the Act provides the underlying 
authority for controlling all HAP emissions.
    The State's construction permit program applies to new and modified 
sources which would emit ``air contaminants.'' ``Air contaminant'' is 
further defined in Section 75-2-103 of the MCA as ``dust, fumes, mist, 
smoke, other particulate matter, vapor, gas, odorous substances, or any 
combination thereof.'' The State has defined ``air contaminant'' in 
such a broad manner that it includes HAPs. Consequently, the State's 
construction permit program provides authority for the State to issue 
construction permits to sources of HAPs.
    The criteria which were used in reviewing Montana's construction 
permit program are located in 40 CFR 51.160 through 51.164. As 
discussed in Section II.C. above and as detailed in the TSD 
accompanying this notice, EPA believes the State's construction permit 
program adequately meets the requirements of 40 CFR 51.160 through 
51.164. EPA believes the most significant criteria in 40 CFR part 51 
for creating federally enforceable limits through construction permits 
are those in 40 CFR 51.160 through 51.162. Further, as discussed in 
EPA's January 25, 1995 memorandum from John S. Seitz, Director of the 
Office of Air Quality Planning and Standards, and Robert I. Van 
Heuvelen, Director of the Office of Regulatory Enforcement, entitled 
``Options for Limiting the Potential to Emit of a Stationary Source 
Under Section 112 and Title V of the Clean Air Act,'' in order for EPA 
to consider any construction permit terms federally enforceable, such 
permit conditions must be enforceable as a practical matter. Montana's 
program will allow the State to issue permits that are enforceable as a 
practical matter. Thus, any permits issued in accordance with Montana's 
program and which are practically enforceable would be considered 
federally enforceable.
    In addition to meeting the criteria in 40 CFR 51.160-164 for 
creating federally enforceable construction permits, a construction 
permit program for HAPs must meet the statutory criteria for approval 
under section 112(l)(5) of the Act. This section allows EPA to approve 
a program only if it: (1) Contains adequate authority to assure 
compliance with any section 112 standards or requirements; (2) provides 
for adequate resources; (3) provides for an expeditious schedule for 
assuring compliance with section 112 requirements; and (4) is otherwise 
likely to satisfy the objectives of the Act.
    The EPA plans to codify the approval criteria for programs limiting 
the potential to emit of HAPs through amendments to subpart E of 40 CFR 
part 63, the regulations promulgated to implement section 112(l) of the 
Act. EPA believes it has the authority under section 112(l) to approve 
programs to limit potential to emit HAPs directly under section 112(l) 
prior to this revision to subpart E of 40 CFR part 63. Given the timing 
problems posed by impending deadlines under section 112 and Title V, 
EPA believes it is reasonable to read section 112(l) to allow for 
approval of programs to limit potential to emit prior to issuance of a 
rule specifically addressing this issue. The EPA is therefore approving 
Montana's construction permit program to limit the potential to emit 
HAPs now, so that the State may begin to issue federally enforceable 
synthetic minor permits as soon as possible. The EPA also plans to 
codify programs approved under section 112(l) without further 
rulemaking once the revisions to subpart E are promulgated.
    As discussed above in Section II.C., Montana's construction permit 
program in ARM 16.8.1101-1120 satisfies the criteria for such programs 
in 40 CFR 51.160 through 51.164. In addition, EPA believes Montana's 
construction permit program meets the statutory criteria for approval 
under section 112(l)(5). For further details, refer to the TSD 
accompanying this document. Accordingly, EPA finds that Montana's 
construction permit program in subchapter 11 of its air quality rules 
satisfies the applicable criteria for establishing federally 
enforceable limitations for HAPs. Therefore, EPA is approving Montana's 
construction permit program in ARM 16.8.1101-1120 of the State's rules 
under section 112(l) of the Act.

Final Action

    EPA is acting on the revisions to the Montana SIP which were 
submitted by the Governor on May 17, 1994. Specifically, EPA is 
approving the State's submittal for meeting the NSR requirements of the 
amended Act for the State's CO, SO2, and lead nonattainment areas 
and for the Butte, Columbia Falls, Libby, and Missoula PM-10 
nonattainment areas. However, for the Kalispell PM-10 nonattainment 
areas where EPA has not yet promulgated a finding that major sources of 
PM-10 precursors do not contribute significantly to PM-10 exceedances 
in the area, EPA is only partially approving the submittal at this time 
because the State's submittal did not include NSR provisions for new 
and modified major sources of PM-10 precursors proposing to locate in 
this area. EPA is approving all of the other State regulations included 
in this submittal, with the exception of: the variance provisions in 
16.8.101-102, which EPA will be acting on in a separate notice; the 
hydrocarbon rule director's discretion provisions in 16.8.1425(1)(c) 
and (2)(d), which EPA is disapproving; and the odor rules in 16.8.1427 
and the sulfur oxide emission limits for lead smelters in 16.8.1414, 
which EPA is not incorporating into the approved SIP. In addition, EPA 
is not approving the current version of ARM 16.8.1302 and 1307 of the 
State's open burning rules included in the State's May 1994 submittal, 
because these provisions were previously disapproved by EPA on December 
21, 1992 (see 57 FR 60485-60486). The previously approved version of 
ARM 16.8.1302 and 

[[Page 36721]]
1307, as in effect on April 16, 1982 and as approved by EPA on July 15, 
1982 (47 FR 30763, 40 CFR 52.1370(c)(11)), remain part of the SIP.
    EPA is also approving the State's construction permit requirements 
in ARM 16.8.1101-1120 for the purposes of creating federally 
enforceable limits for HAPs pursuant to section 112(l) of the Act, as 
well as for pollutants regulated under the SIP.
    In accordance with the Governor's request, EPA is replacing any 
State regulations previously approved in the SIP with the following 
State regulations effective as of March 30, 1994: ARM 16.8.201-202, 
16.8.301-304, 16.8.401-404, 16.8.701-709, 16.8.945-963, 16.8.1001-1008, 
16.8.1101-1120, 16.8.1204-1206, 16.8.1301, 16.8.1303-1306, 16.8.1308, 
16.8.1401-1413, 1419-1424, 16.8.1425 (except 16.8.1425(1)(c) and 
(2)(d)), 16.8.1426, 16.8.1428-1430, 16.8.1501-1505, 16.8.1701-1705, 
16.8.1801-1806. The previously-approved versions of ARM 16.8.1302 and 
16.8.1307, as in effect on April 16, 1982, remain part of the SIP.
    Also in this action, EPA is deleting 40 CFR 52.1386, in which EPA 
originally codified its disapproval of Montana's malfunction provision. 
EPA subsequently approved a revised version of Montana's malfunction 
provision on July 13, 1984 (see 49 FR 28553) and inadvertently failed 
to remove this previous disapproval from the Code of Federal 
Regulations. Thus, the disapproval in 40 CFR 52.1386 no longer is 
applicable and is being deleted.
    The EPA is publishing this action without prior proposal because 
the Agency views this as a noncontroversial action and anticipates no 
adverse comments. However, in a separate document in this Federal 
Register publication, the EPA is proposing to approve the SIP revision 
should adverse or critical comments be filed. Under the procedures 
established in the May 10, 1994 Federal Register (59 FR 24054), this 
action will be effective on September 18, 1995 unless, by August 17, 
1995, adverse or critical comments are received.
    If the EPA receives such comments, this action will be withdrawn 
before the effective date by publishing a subsequent document that will 
withdraw the final action. All public comments received will then be 
addressed in a subsequent final rule based on this action serving as a 
proposed rule. The EPA will not institute a second comment period on 
this action. Any parties interested in commenting on this action should 
do so at this time. If no such comments are received, the public is 
advised that this action will be effective on September 18, 1995.
    Nothing in this action should be construed as permitting or 
allowing or establishing a precedent for any future request for 
revision to any SIP. Each request for revision to any SIP shall be 
considered separately in light of specific technical, economic, and 
environmental factors and in relation to relevant statutory and 
regulatory requirements.
    The Office of Management and Budget (OMB) has exempted this 
regulatory action from Executive Order 12866 review.
    Under the Regulatory Flexibility Act, 5 U.S.C. 600 et. seq., EPA 
must prepare a regulatory flexibility analysis assessing the impact of 
any proposed or final rule on small entities. 5 U.S.C. 603 and 604. 
Alternatively, EPA may certify that the rule will not have a 
significant economic impact on a substantial number of small entities. 
Small entities include small businesses, small not-for-profit 
enterprises, and government entities with jurisdiction over populations 
of less than 50,000.
    SIP approvals under section 110 and subchapter I, part D of the Act 
do not create any new requirements, but simply approve requirements 
that the State is already imposing. Therefore, because the Federal SIP-
approval does not impose any new requirements, I certify that it does 
not have a significant impact on any small entities affected. Moreover, 
due to the nature of the Federal-state relationship under the Act, 
preparation of a regulatory flexibility analysis would constitute 
Federal inquiry into the economic reasonableness of state action. The 
Act forbids EPA to base its actions concerning SIPs on such grounds. 
Union Electric Co. v. U.S. E.P.A., 427 U.S. 246, 256-66 (S.Ct. 1976); 
42 U.S.C. 7410(a)(2).
    Under Sections 202, 203, and 205 of the Unfunded Mandates Reform 
Act of 1995 (``Unfunded Mandates Act''), signed into law on March 22, 
1995, EPA must undertake various actions in association with proposed 
or final rules that include a Federal mandate that may result in 
estimated costs of $100 million or more to the private sector, or to 
State, local, or tribal governments in the aggregate.
    Through submission of this state implementation plan or plan 
revision, the State and any affected local or tribal governments have 
elected to adopt the program provided for under Section 110 of the 
Clean Air Act. These rules may bind State, local and tribal governments 
to perform certain actions and also require the private sector to 
perform certain duties. The rules being approved by this action will 
impose no new requirements; such sources are already subject to these 
regulations under State law. Accordingly, no additional costs to State, 
local, or tribal governments, or to the private sector, result from 
this action. EPA has also determined that this final action does not 
include a mandate that may result in estimated costs of $100 million or 
more to State, local, or tribal governments in the aggregate or to the 
private sector.
    Under section 307(b)(1) of the Clean Air Act, petitions for 
judicial review of this action must be filed in the United States Court 
of Appeals for the appropriate circuit by September 18, 1995. Filing a 
petition for reconsideration by the Administrator of this final rule 
does not affect thefinality of this rule for the purposes of judicial 
review nor does it extend the time within which a petition for judicial 
review may be filed, and shall not postpone the effectiveness of such 
rule or action. This action may not be challenged later in proceedings 
to enforce its requirements. (See section 307(b)(2).)

List of Subjects in 40 CFR Part 52

    Environmental protection, Air pollution control, Carbon monoxide, 
Hydrocarbons, Incorporation by reference, Intergovernmental relations, 
Lead, Nitrogen dioxide, Ozone, Particulate matter, Reporting and 
recordkeeping requirements, Sulfur oxides, Volatile organic compounds.

    Dated: June 23, 1995.
Jack W. McGraw,
Acting Regional Administrator.

    Part 52, chapter I, title 40 of the Code of Federal Regulations is 
amended as follows:

PART 52--[AMENDED]

    1. The authority citation for part 52 continues to read as follows:

    Authority: 42 U.S.C. 7401-7671q.

Subpart BB--Montana

    2. Section 52.1370 is amended by adding paragraph (c)(39) to read 
as follows:


Sec. 52.1370  Identification of plan.

* * * * *
    (c) * * *
    (39) On May 17, 1994, the Governor of Montana submitted revisions 
to the Administrative Rules of Montana (ARM) regarding nonattainment 
new source review, prevention of significant deterioration, general 
construction permitting, wood waste burners, source 

[[Page 36722]]
test methods, new source performance standards, and national emission 
standards for hazardous air pollutants. Also, the Governor requested 
that all existing State regulations approved in the SIP be replaced 
with the October 1, 1979 codification of the ARM as in effect on March 
30, 1994. EPA is replacing all of the previously approved State 
regulations, except ARM 16.8.1302 and 16.8.1307, with those regulations 
listed in paragraph (c)(39)(i)(A) of this section. ARM 16.8.1302 and 
16.8.1307, as in effect on April 16, 1982 and as approved by EPA at 40 
CFR 52.1370(c)(11), will remain part of the SIP.
    (i) Incorporation by reference.
    (A) Administrative Rules of Montana (ARM) Sections 16.8.201-202, 
16.8.301-304, and 16.8.401-404, effective 12/31/72; Section 16.8.701, 
effective 12/10/93; Section 16.8.704, effective 2/14/87; Section 
16.8.705, effective 6/18/82; Section 16.8.707, effective 9/13/85; 
Sections 16.8.708-709, effective 12/10/93; Sections 16.8.945-963, 
effective 12/10/93; Sections 16.8.1001-1003, effective 9/13/85; Section 
16.8.1004, effective 12/25/92; Sections 16.8.1005-1006, effective 9/13/
85; Section 16.8.1007, effective 4/29/88; Section 16.8.1008, effective 
9/13/85; Section 16.8.1101, effective 6/16/89; Section 16.8.1102, 
effective 2/14/87; Section 16.8.1103, effective 6/16/89; Section 
16.8.1104, effective 3/16/79; Section 16.8.1105, effective 12/27/91; 
Sections 16.8.1107 and 16.8.1109, effective 12/10/93; Sections 
16.8.1110-1112. effective 3/16/79; Section 16.8.1113, effective 2/14/
87; Section 16.8.1114, effective 12/10/93; Sections 16.8.1115, 
16.8.1117, and 16.8.1118, effective 3/16/79; Sections 16.8.1119-1120, 
effective 12/10/93; Sections 16.8.1204-1206, effective 6/13/86; 
Sections 16.8.1301 and 16.8.1303, effective 4/16/82; Section 16.8.1304, 
effective 9/11/92; Section 16.8.1305, effective 4/16/82; Section 
16.8.1306, effective 4/1/82; Section 16.8.1308, effective 10/16/92; 
Section 16.8.1401, effective 10/29/93; Section 16.8.1402, effective 3/
11/88; Section 16.8.1403, effective 9/5/75; Section 16.8.1404, 
effective 6/13/86; Section 16.8.1406, effective 12/29/78; Section 
16.8.1407, effective 10/29/93; Section 16.8.1411, effective 12/31/72; 
Section 16.8.1412, effective 3/13/81; Section 16.8.1413, effective 12/
31/72; Section 16.8.1419, effective 12/31/72; Sections 16.8.1423, 
16.8.1424, and 16.8.1425 (except 16.8.1425(1)(c) and (2)(d)), effective 
10/29/93; Section 16.8.1426, effective 12/31/72; Sections 16.8.1428-
1430, effective 10/29/93; Section 16.8.1501, effective 2/10/89; Section 
16.8.1502, effective 2/26/82; Section 16.8.1503, effective 2/10/89; 
Sections 16.8.1504-1505, effective 2/26/82; Sections 16.8.1701-1705, 
effective 12/10/93; and Sections 16.8.1801-1806, effective 12/10/93.
    3. Section 52.1384 is amended by removing and reserving paragraph 
(a) and adding a new paragraph (c) to read as follows:


Sec. 52.1384  Emission control regulations.

* * * * *
    (c) The provisions in ARM 16.8.1425(1)(c) and (2)(d) of the State's 
rule regulating hydrocarbon emissions from petroleum products, which 
were submitted by the Governor of Montana on May 17, 1994 and which 
allow discretion by the State to allow different equipment than that 
required by this rule, are disapproved. Such discretion cannot be 
allowed without requiring EPA review and approval of the alternative 
equipment to ensure that it is equivalent in efficiency to that 
equipment required in the approved SIP.


Sec. 52.1386  [Removed and reserved]

    4. Section 52.1386 is removed and reserved.

[FR Doc. 95-17212 Filed 7-17-95; 8:45 am]
BILLING CODE 6560-50-P