[Federal Register Volume 60, Number 170 (Friday, September 1, 1995)]
[Proposed Rules]
[Pages 45685-45690]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-21761]



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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 70

[AD-FRL-5290-3]


Clean Air Act Proposed Approval of the Federal Operating Permits 
Program; San Luis Obispo Air Pollution Control District, California

AGENCY: Environmental Protection Agency (EPA).

ACTION: Proposed rule.

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SUMMARY: The EPA is proposing interim approval for the Federal 
Operating Permits Program submitted by the California Air Resources 
Board on behalf of the San Luis Obispo County Air Pollution Control 
District (San Luis Obispo or District). This Program was submitted for 
the purpose of complying with Federal requirements in title V of the 
Clean Air Act which mandates that States develop, and submit to EPA, 
programs for issuing operating permits to all major stationary sources 
and to certain other sources.

DATES: Comments on this proposed action must be received in writing by 
October 2, 1995.

ADDRESS: Comments should be addressed to Frances Wicher, Mail Code A-5-
2, U.S. Environmental Protection Agency, Region IX, Air and Toxics 
Division, 75 Hawthorne Street, San Francisco, California 94105.
    Copies of the District's submission and other supporting 
information used in developing the proposed interim approval including 
the Technical Support Document are available for inspection during 
normal business hours at the following location: Operating Permits 
Section, A-5-2, Air and Toxics Division, U.S. EPA-Region IX, 75 
Hawthorne Street, San Francisco, California 94105.

FOR FURTHER INFORMATION CONTACT: Frances Wicher, (415) 744-1250, 
Operating Permits Section, A-5-2, Air and Toxics Division, U.S. EPA-
Region IX, 75 Hawthorne Street, San Francisco, California 94105.

SUPPLEMENTARY INFORMATION:

I. Background and Purpose

    As required under title V of the Clean Air Act (``the Act'') as 
amended (1990), EPA has promulgated rules that define the minimum 
elements of an approvable State operating permits program and the 
corresponding standards and procedures by which the EPA will approve, 
oversee, and withdraw approval of State operating permits programs (see 
57 FR 32250 (July 21, 1992)). These rules are codified at 40 CFR part 
70. Title V requires States to develop, and submit to EPA, programs for 
issuing operating permits to all major stationary sources and to 
certain other sources.
    The Act requires that States develop and submit these programs to 
EPA by November 15, 1993, and that EPA act to approve or disapprove 
each program within one year of receiving the submission. 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.

II. Proposed Action and Implications

A. Analysis of State Submission

    The analysis contained in this notice focuses on the major elements 
of San Luis Obispo's title V operating permit program and on the 
specific elements that must be corrected to meet the minimum 
requirements of part 70. The full program submittal, the Technical 
Support Document (TSD), which contains a detailed analysis of the 
submittal, and other relevant materials are available for inspection as 
part of the public docket. The docket may be viewed during regular 
business hours at the address listed above.
1. Title V Program Support Materials
    San Luis Obispo's title V program was submitted by the California 
Air Resources Board (CARB) on November 15, 1993. Additional material 
was submitted by CARB on May 23 and August 21, 1995 and by the District 
on February 18, 1994 and May 3, 1995. In submitting the District's 
title V program, CARB requested source category-limited interim 
approval for the program because California law currently exempts 
agricultural sources from all permitting requirements including title 
V. The District's submission contains a complete program description, 
District implementing and supporting regulations, application and 
reporting 

[[Page 45686]]
forms, and other supporting information. In addition, CARB submitted 
for all Districts in the State a single Attorney General's opinion, 
State enabling legislation, and certain other information regarding 
State law.
    EPA reviewed the District's program to assure that it contains all 
the elements required by Sec. 70.4(b) (elements of the initial program 
submission) and has found the program complete pursuant to 
Sec. 70.4(e)(1) in a letter to the CARB on January 13, 1994. An 
implementation agreement is currently being developed between San Luis 
Obispo and EPA.
2. Title V Operating Permit Regulations and Program Implementation
    The rules that San Luis Obispo adopted to implement its title V 
program are Rules 216 Federal Part 70 Permits (adopted October 26, 
1993) and Rules 217 Federal Part 72 Permits (adopted March 29, 1995). 
Other District rules that were submitted in support of the District's 
title V program are Rules 103 Conflicts between District, State and 
Federal Rules (no date), 105 Definitions (revised October 26, 1993), 
107 Breakdown or Upset Conditions and Emergency Variances (revised 
March 29, 1995), 201 Equipment Not Requiring a Permit (revised November 
5, 1991), 206 Conditional Approval (revised November 5, 1991) and 301-
308 Fees (various adoption and revision dates).1 These rules, 
along with the authorities granted the District under California State 
law, substantially meet the requirements of Secs. 70.2 (Definitions) 
and 70.3 (Applicability) for applicability; Sec. 70.5(c) (Standard 
application form and required information) for criteria that define 
insignificant activities and for complete application forms; 
Secs. 70.4(b)(12) (Section 502(b)(10) changes) and 70.6 (Permit 
content) for permit content including operational flexibility; 
Sec. 70.7 (Permit issuance, renewal, reopenings, and revisions) for 
public participation, permit issuance, and permit modifications; 
Sec. 70.9 (Fee determination and certification) for fees; and 
Sec. 70.11 for enforcement authority.

    \1\ EPA is only approving those portions of Rules 105, 107, 206 
and 301-308 that are necessary to implement the District's title V 
program. More specifically, EPA is not approving the emergency 
variance provisions of Rule 107 B. This approval does not constitute 
approval under any other provisions of the Act.
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    EPA has identified several interim approval issues affecting permit 
content, permit modifications and notice to the public and affected 
states that must be corrected in order for the San Luis Obispo program 
to receive full approval. These interim approval issues are discussed 
below and detailed in the TSD. EPA has also identified in the TSD other 
recommended changes that are not required for full approval but would 
improve, clarify, or strengthen the District's title V program.
a. Variances
    The San Luis Obispo District Hearing Board has authority to issue 
variances from requirements imposed by State and local law. See 
California Health and Safety Code 42350 et seq. and District Rule 107 
and Regulation VII. In the opinion submitted with California operating 
permit programs, California's Attorney General states that ``(t)he 
variance process is not part of the Title V permitting process and does 
not affect federal enforcement for violations of the requirements set 
forth in a Title V permit.'' (Emphasis in original.)
    EPA regards State and District variance provisions as wholly 
external to the programs submitted for approval under part 70 and 
consequently is proposing to take no action on these provisions of 
State and local law. EPA has no authority to approve provisions of 
state law that are inconsistent with the Act. EPA does not recognize 
the ability of a District to grant relief from the duty to comply with 
a federally-enforceable part 70 permit, except where such relief is 
granted through procedures allowed by part 70. A part 70 permit may be 
issued or revised, consistent with part 70 permitting procedures, to 
incorporate those terms of a variance that are consistent with 
applicable requirements. A part 70 permit may also incorporate, via 
part 70 permit issuance or revision procedures, the schedule of 
compliance set forth in a variance. However, EPA reserves the right to 
pursue enforcement of applicable requirements notwithstanding the 
existence of a compliance schedule in a permit to operate. This is 
consistent with Sec. 70.5(c)(8)(iii)(C), which states that a schedule 
of compliance ``shall be supplemental to, and shall not sanction 
noncompliance with, the applicable requirements on which it is based.''
b. Permit Content
    San Luis Obispo's permit content requirements are found in sections 
F. and L. of Rule 216 and in the District's Part 70 Permit Format. The 
Part 70 Permit Format is San Luis Obispo's sample permit form and was 
submitted as part of the District's title V program. The regulatory 
provisions adequately address nearly all of the part 70 requirements; 
however, certain elements (e.g., Secs. 70.6(a)(3)(ii)(A) and 
70.6(a)(6)(i)), are addressed or more fully detailed only in the Part 
70 Permit Format. Nothing in the District's program requires the use of 
the Part 70 Permit Format for every permit issued pursuant to Rule 216. 
EPA is, therefore, requiring, as a condition for full approval, that 
San Luis Obispo establish a binding requirement that the Part 70 Permit 
Format be included in all part 70 permits or that the District fully 
address all part 70 permit content requirements in Rule 216.
    EPA is specifically approving the Part 70 Permit Format (dated 
November 13, 1993) contained in Appendix B-6 of the District November 
15, 1993 submittal. Any modifications to the conditions established in 
this Format must be approved by EPA. Failure to include these 
conditions in part 70 permits will be cause for EPA to object to a 
District operating permit. See Sec. 70.8(c)(1).
c. Insignificant Activities
    Section 70.4(b)(2) requires States to include in their title V 
programs any criteria used to determine insignificant activities or 
emission levels for the purpose of determining complete applications. 
Section 70.5(c) states that an application for a part 70 permit may not 
omit information needed to determine the applicability of, or to 
impose, any applicable requirement, or to evaluate appropriate fee 
amounts. Section 70.5(c) also states that EPA may approve, as part of a 
State program, a list of insignificant activities and emissions levels 
which need not be included in permit applications. Under part 70, a 
State must request and EPA must approve as part of that State's program 
any activity or emission level that the State wishes to consider 
insignificant. Part 70, however, does not establish appropriate 
emission levels for insignificant activities, relying instead on a 
case-by-case determination of appropriate levels based on the 
particular circumstances of the part 70 program under review.
    San Luis Obispo submitted, as an insignificant activities list, its 
permit exemption rule (Rule 201) which specifies a specific list of 
activities and, for unlisted activities, an emissions cap of 2 lb/day 
(0.365 tons per year) that will be considered insignificant in the 
District's title V program. Rule 201, however, does not allow any 
activities that are subject to a New Source Performance Standard or 
National Emission Standard for Hazardous Air Pollutants to be 
considered insignificant. In addition, the District submitted an 
emissions analysis of its list of insignificant activities. 

[[Page 45687]]

    San Luis Obispo County is designated attainment for all criteria 
pollutants; therefore, the major source threshold for all non-HAPs 
regulated air pollutants is 100 tons per year and, for HAPs, 10 tons 
per year for a single HAP and 25 tpy for a combination of HAPs. The 
District's emissions cap for insignificant activities is less than \1/
2\ of 1 percent of the major source threshold for all non-HAPs 
regulated air pollutants and less than 5 percent of the major source 
threshold for HAPs. EPA finds these levels to be insignificant and the 
2 lb/day cap to be fully approvable.
    EPA, however, in reviewing the District list of specific activities 
did find several activities that are potentially subject to a unit-
specific applicable requirement. Rule 201 M.1. and 2. exempts air 
conditioning and refrigeration units regardless of size. Such units, if 
they have a charge rate of 50 pounds or more of a Class I or II ozone-
depleting compounds, would be subject to applicable requirements and 
could not be considered insignificant.
    The TSD provides a detailed review of the District's insignificant 
activities list. For interim approval, EPA is relying on San Luis 
Obispo's Rule 216 which requires the inclusion in each permit 
application of a list of all activities that are insignificant based on 
size or production rate and all information necessary to determine the 
applicability of, and to impose applicable requirements. For full 
program approval San Luis Obispo must revise its list of insignificant 
activities for title V permitting as discussed in section B.2. of this 
notice.
d. Definition of Title I Modification
    The San Luis Obispo program does not explicitly define the term 
``title I modification,'' however, the program effectively defines the 
term to mean ``the modification does not involve any addition, 
deletion, or revision to a part 70 permit condition under section 
112(g) of Title I of the CAA, or under EPA regulations promulgated 
pursuant to Title I of the CAA, including 40 CFR parts 51, 52, 60, 61, 
and 62.'' See, for example, Rule 216 C.13., definition of ``Minor Part 
70 Permit Modification.'' While this effective definition is broad 
enough to cover minor new source review (minor NSR) changes because it 
includes changes under parts 51 and 52, it is clear from the Program 
Description that the District does not intend that minor NSR be 
considered a title I modification.
    In an August 29, 1994 rulemaking proposal, EPA explained its view 
that the better reading of ``title I modifications'' includes minor 
NSR. However, the Agency solicited public comment on whether the phrase 
should be interpreted to mean literally any change at a source that 
would trigger permitting authority review under regulations approved or 
promulgated under title I of the Act. (59 FR 44572, 44573). This would 
include State preconstruction review programs approved by EPA as part 
of the State Implementation Plan under section 110(a)(2)(C) of the 
Clean Air Act.
    The EPA has not yet taken final action on the August 29, 1994 
proposal. However, in response to public comment on that proposal, the 
Agency has decided that the definition of ``title I modifications'' is 
best interpreted as not including changes reviewed under minor NSR 
programs. This decision was announced in a June 20, 1995 letter from 
Mary D. Nichols, EPA Assistant Administrator for Air and Radiation, to 
Congressman John D. Dingell, and will be included in a supplemental 
rulemaking proposal that will be published in August, 1995. Thus, EPA 
expects to confirm that San Luis Obispo's definition of ``title I 
modification'' is fully consistent with part 70.
    The August 29, 1994 action proposed to, among other things, allow 
State programs with a more narrow definition of ``title I 
modifications'' to receive interim approval (59 FR 44572). The Agency 
stated that if, after considering the public comments, it continued to 
believe that the phrase ``title I modifications'' should be interpreted 
as including minor NSR changes, it would revise the interim approval 
criteria as needed to allow states with a narrower definition to be 
eligible for interim approval. If EPA does conclude, during this 
rulemaking, that Title I modifications should be read to include minor 
NSR, it will implement the interim approval option spelled out in the 
August 29, 1994 proposal.
e. Affected State Notification
    The San Luis Obispo program neither defines ``affected state'' nor 
includes any procedures for notifying and dealing with comments from 
affected states as required by Sec. 70.2 ``Affected state'', 
Sec. 70.8(b) and Sec. 70.7(e)(2)(ii). In its program submittal, the 
District argued that it need not include these procedures because its 
location (on the coastline in the middle of California) precludes 
emissions from its sources from affecting any other states. EPA would 
agree with this position if the definition of ``affected state'' was 
not being revised to include tribal governments that request treatment 
as affected states. Because there are tribal lands that could qualify 
as affected states for San Luis Obispo, the District may in the future 
need to have affected state notification and response procedures in its 
title V program.
    EPA has not finalized the rulemaking that will allow tribal 
governments to seek affected state status. EPA is proposing, as an 
interim approval issue for the District, that Rule 216 be revised to 
define and provide for giving notice to and responding to comments from 
affected states. Since it remains uncertain whether any tribes will 
seek affected state status for the San Luis Obispo District, EPA is 
proposing as an alternative that the District may satisfy the interim 
approval issue by making a commitment to: (1) Initiate rule revisions 
upon being notified by EPA of an application by a tribe for state 
status, and (2) provide affected state notice to tribes upon their 
filing for state status (i.e., prior to San Luis Obispo's revising Rule 
216 to incorporate affected state notice procedures).
3. Permit Fee Demonstration
    Section 502(b)(3) of the Act requires that each permitting 
authority collect fees sufficient to cover all reasonable direct and 
indirect costs required to develop and administer its title V operating 
permits program. Each title V program submission must contain either a 
detailed demonstration of fee adequacy or a demonstration that 
aggregate fees collected from title V sources meet or exceed $25 per 
ton of emissions per year (adjusted from 1989 by the Consumer Price 
Index (CPI)). The $25 per ton amount is presumed, for program approval, 
to be sufficient to cover all reasonable program costs and is thus 
referred to as the ``presumptive minimum,'' (Sec. 70.9(b)(2)(i)).
    San Luis Obispo has opted to make a presumptive minimum fee 
demonstration in order to show fee adequacy and meet the requirements 
of Sec. 70.9 (Fee determination and certification). San Luis Obispo's 
existing fee schedule (Rules 301-308) requires title V facilities to 
pay an amount equivalent to $61 per ton in annual operating fees (1991 
figures). This amount is well over the $25 per ton per year (CPI 
adjusted from 1989) presumptive minimum.
    San Luis Obispo determined its fee level at the $61 per ton 
equivalent amount by assessing its 1991 fee revenue and costs, and the 
additional costs posed by title V. San Luis Obispo is prepared to 
increase fees, as needed, to reflect actual program implementation 
costs. 

[[Page 45688]]

4. Provisions Implementing the Requirements of Other Titles of the Act
a. Authority and Commitments for Section 112 Implementation
    San Luis Obispo has demonstrated in its title V program submission 
adequate legal authority to implement and enforce all section 112 
requirements through the title V permit. This legal authority is 
contained in the State of California enabling legislation and in 
regulatory provisions defining ``federally enforceable requirements'' 
and stating that the permit must incorporate all applicable 
requirements. EPA has determined that this legal authority is 
sufficient to allow San Luis Obispo to issue permits that assure 
compliance with all section 112 requirements. For further discussion on 
the District's legal authority, please refer to the TSD accompanying 
this rulemaking and the April 13, 1993 guidance memorandum titled 
``Title V Program Approval Criteria for Section 112 Activities,'' 
signed by John Seitz, Director, Office of Air Quality Planning and 
Standards, U.S. EPA.
b. Authority for Title IV (Acid Rain) Implementation
    On May 23, 1995, CARB submitted on behalf of San Luis Obispo, the 
District's rule Rule 217 Federal Part 72 Permits (adopted March 29, 
1995). Rule 217 incorporates by reference 40 CFR part 72 (Acid Rain) 
Permit Regulation and provides the District adequate authority to issue 
permits to affected acid rain sources under title IV.
B. Proposed Action

1. Title V Operating Permits Program
    The EPA is proposing to grant interim approval to the operating 
permits program submitted by CARB on behalf of the San Luis Obispo 
County Air Pollution Control District on November 15, 1993, and 
supplemented on February 18, 1994, and May 3, May 23 and August 21, 
1995. If EPA were to finalize this proposed interim approval, it would 
extend for two years following the effective date of final interim 
approval, and could not be renewed. During the interim approval period, 
San Luis Obispo would be protected from sanctions, and EPA would not be 
obligated to promulgate, administer and enforce a federal permits 
program for the District. 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 interim approval, as does the three-
year time period for processing the initial permit applications.
    Following final interim approval, if the District failed to submit 
a complete corrective program for full approval by the date six months 
before expiration of the interim approval, EPA would start an 18-month 
clock for mandatory sanctions. If San Luis Obispo then failed to submit 
a corrective program that EPA found complete before the expiration of 
that 18-month period, EPA would be required to apply one of the 
sanctions in section 179(b) of the Act, which would remain in effect 
until EPA determined that the District had corrected the deficiency by 
submitting a complete corrective program. Moreover, if the 
Administrator found a lack of good faith on the part of the District, 
both sanctions under section 179(b) would apply after the expiration of 
the 18-month period until the Administrator determined that the 
District had come into compliance. In any case, if, six months after 
application of the first sanction, the District still had not submitted 
a corrective program that EPA found complete, a second sanction would 
be required.
    If, following final interim approval, EPA were to disapprove San 
Luis Obispo's complete corrective program, EPA would 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 
District had submitted a revised program and EPA had determined that it 
corrected the deficiencies that prompted the disapproval. Moreover, if 
the Administrator found a lack of good faith on the part of the 
District, both sanctions under section 179(b) would apply after the 
expiration of the 18-month period until the Administrator determined 
that the District had come into compliance. In all cases, if, six 
months after EPA applied the first sanction, San Luis Obispo had not 
submitted a revised program that EPA had determined corrected the 
deficiencies that prompted disapproval, a second sanction would be 
required.
    In addition, discretionary sanctions may be applied where warranted 
any time after the end of an interim approval period if a district has 
not timely submitted a complete corrective program or EPA has 
disapproved a submitted corrective program. Moreover, if EPA has not 
granted full approval to a District title V operating permits program 
by the expiration of an interim approval and that expiration occurs 
after November 15, 1995, EPA must promulgate, administer and enforce a 
federal permits program for that district upon interim approval 
expiration.
2. Interim Approval Issues for San Luis Obispo's Title V Operating 
Permits Program
    If EPA finalizes this interim approval, San Luis Obispo must make 
the following changes, or changes that have the same effect, to receive 
full approval:
    (1) Remove any activities from the District's list of insignificant 
activities that are subject to a unit-specific applicable requirement. 
See Secs. 70.4(b)(2) and 70.5(c).
    (2) Revise the definitions of ``Minor Part 70 Permit Modification'' 
in Rule 216 C.13, to ensure that significant changes to existing 
monitoring permit terms or conditions, rather than just relaxations of 
existing monitoring terms, are processed as significant permit 
modifications. See Sec. 70.7(e)(4).
    (3) Revise Rule 216 J.1.b. to include notice ``by other means if 
necessary to assure adequate notice to the affected public.'' See 
Sec. 70.7(h)(1).
    (4) Revise Rule 216 H.1.a.4. and L.1.e. to further limit the types 
of significant permit modifications that may be operated prior to 
receiving a final part 70 permit revision to only those modifications 
that are subject to section 112(g) or required to have a permit under 
title I, parts C and D of the Act and that are not otherwise prohibited 
by an existing part 70 permit. See Sec. 70.5(a)(1)(ii).
    (5) Revise Rule 216 to establish a binding requirement that the 
Part 70 Permit Format will be included in all part 70 permits or revise 
Rule 216 to fully address all part 70 permit content requirements 
within the Rule. See Sec. 70.6.
    (6) Revise Rule 216 to define and provide for giving notice to and 
responding to comments from affected states. Alternatively, San Luis 
Obispo may make a commitment to: (1) Initiate rule revisions upon being 
notified by EPA of an application by a tribe for state status, and (2) 
provide affected state notice to tribes upon their filing for state 
status (i.e., prior to revising Rule 216 to incorporate affected state 
notice procedures). See Secs. 70.2 ``Affected state,'' 70.7(e)(2)(iii), 
and 70.8(b).
    (7) Limit the exemption in Rule 216 D.4 for solid waste 
incineration units required to obtain a permit pursuant to section 3005 
of the Solid Waste Disposal Act to those units that are not a major 
source. Section 70.3(b) states that all major sources, affected sources 
(acid rain sources), and solid waste incinerators regulated pursuant to 
section 129(e) of the CAA may not be exempted from title V permitting. 

[[Page 45689]]
Although section 129(g)(1) of the CAA exempts solid waste incineration 
units subject to section 3005 of the Solid Waste Disposal Act from 
regulation under section 129, these units are still subject to title V 
and part 70 if they are also major sources. See Sec. 70.3(a)(1).
    (8) Revise Rule 216 H.4. to require that the permittee keep records 
describing non-federal minor changes (e.g., off-permit changes) and the 
emissions resulting from these changes. See Sec. 70.4(b)(14)(iv).
3. California Enabling Legislation--Legislative Source Category Limited 
Interim Approval Issue
    Because California State law currently exempts agricultural 
production sources from permit requirements, CARB has requested source 
category-limited interim approval for all California districts. EPA is 
proposing to grant source category-limited interim approval to the 
operating permits program submitted by CARB on behalf of San Luis 
Obispo on November 15, 1993. In order for this program to receive full 
approval (and to avoid a disapproval upon the expiration of this 
interim approval), the Health and Safety Code must be revised to 
eliminate the exemption of agricultural production sources from the 
requirement to obtain a title V permit. Once the California statute has 
revised, the District must also revise its permit exemption rules to 
eliminate any blanket exemption granted agricultural sources.
    The above described program and legislative deficiencies must be 
corrected before San Luis Obispo can receive full program approval. For 
additional information, please refer to the TSD, which contains a 
detailed analysis of San Luis Obispo's operating permits program and 
California's enabling legislation.
4. District Preconstruction Permit Program Implementing Section 112(g)
    The EPA has published an interpretive notice in the Federal 
Register regarding section 112(g) of the Act (60 FR 8333, February 14, 
1995). The revised interpretation postpones the effective date of 
section 112(g) until after EPA has promulgated a rule addressing that 
provision. The interpretive notice explains that EPA is considering 
whether the effective date of section 112(g) should be delayed beyond 
the date of promulgation of the federal rule so as to allow States time 
to adopt rules implementing the federal rule, and that EPA will provide 
for any such additional delay in the final section 112(g) rulemaking. 
Unless and until EPA provides for such an additional postponement of 
section 112(g), San Luis Obispo must be able to implement section 
112(g) during the period between promulgation of the federal section 
112(g) rule and adoption of implementing District regulations.
    For this reason, EPA is proposing to approve the use of San Luis 
Obispo's preconstruction review program as a mechanism to implement 
section 112(g) during the transition period between promulgation of the 
section 112(g) rule and adoption by San Luis Obispo of rules 
specifically designed to implement section 112(g). However, since the 
sole purpose of this approval is to confirm that the District has a 
mechanism to implement section 112(g) during the transition period, the 
approval itself will be without effect if EPA decides in the final 
section 112(g) rule that there will be no transition period. The EPA is 
limiting the duration of this proposed approval to 12 months following 
promulgation by EPA of the section 112(g) rule.
5. Program for Delegation of Section 112 Standards as Promulgated
    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 
sources. Section 112(l)(5) requires that the state program contain 
adequate authorities, adequate resources for implementation, and an 
expeditious compliance schedule, which are also requirements under part 
70. Therefore, EPA is also proposing to grant approval under section 
112(l)(5) and 40 CFR part 63.91 of San Luis Obispo's program for 
receiving delegation of section 112 standards that are unchanged from 
federal standards as promulgated. California Health and Safety Code 
section 39658 provides for automatic adoption by CARB of section 112 
standards upon promulgation by EPA. Section 39666 of the Health and 
Safety Code requires that districts then implement and enforce these 
standards. Thus, when section 112 standards are automatically adopted 
pursuant to section 39658, San Luis Obispo will have the authority 
necessary to accept delegation of these standards without further 
regulatory action by the District. The details of this mechanism and 
the means for finalizing delegation of standards will be set forth in a 
Memorandum of Agreement between San Luis Obispo and EPA, expected to be 
completed prior to approval of the District's section 112(l) program 
for delegation of unchanged federal standards. This program applies to 
both existing and future standards but is limited to sources covered by 
the part 70 program.

III. Administrative Requirements

A. Request for Public Comments

    The EPA is requesting comments on all aspects of this proposed 
interim approval. Copies of the District's submittal and other 
information relied upon for the proposed interim approval are contained 
in a docket maintained 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 proposed 
interim approval. The principal purposes of the docket are:
    (1) To allow interested parties a means to identify and locate 
documents so that they can effectively participate in the approval 
process, and
    (2) To serve as the record in case of judicial review. The EPA will 
consider any comments received by October 2, 1995.
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.

D. Unfunded Mandates Act

    Under section 202 of the Unfunded Mandates Reform Act of 1995 
(``Unfunded Mandates Act''), signed into law on March 22, 1995, EPA 
must prepare a budgetary impact statement to accompany any proposed or 
final rule that includes a federal mandate that may result in estimated 
costs to State, local, or tribal governments in the aggregate; or to 
the private sector, of $100 million or more. Under section 205, EPA 
must select the most cost-effective and least burdensome alternative 
that achieves the objectives of the rule and is consistent with 
statutory requirements. Section 203 requires EPA to establish a plan 
for informing and advising any small governments that may be 
significantly or uniquely impacted by the rule.
    EPA has determined that the proposed approval action promulgated 
today does not include a federal mandate that may result in estimated 
costs of $100 million or more to either State, local, or tribal 
governments in the 

[[Page 45690]]
aggregate, or to the private sector. This federal action approves pre-
existing requirements under State or local law, and imposes no new 
federal requirements. Accordingly, no additional costs to State, local, 
or tribal governments, or to the private sector, result from this 
action.

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.

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

    Dated: August 21, 1995.
Felicia Marcus,
Regional Administrator.
[FR Doc. 95-21761 Filed 8-31-95; 8:45 am]
BILLING CODE 6560-50-P