[Federal Register Volume 60, Number 211 (Wednesday, November 1, 1995)]
[Rules and Regulations]
[Pages 55460-55466]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-27142]



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ENVIRONMENTAL PROTECTION AGENCY
40 CFR Part 70

[FRL-5323-5]


Clean Air Act Final Interim Approval of the Operating Permits 
Programs; San Luis Obispo County Air Pollution Control District, Santa 
Barbara County Air Pollution Control District, and Ventura County Air 
Pollution Control District, California

AGENCY: Environmental Protection Agency (EPA).

ACTION: Final interim approval.

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SUMMARY: The EPA is promulgating interim approval of the Operating 
Permits Programs submitted by the California Air Resources Board on 
behalf of the San Luis Obispo County Air Pollution Control District, 
the Santa Barbara County Air Pollution Control District, and the 
Ventura County Air Pollution Control District 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: December 1, 1995.

ADDRESSES: Copies of the Districts' submittals and other supporting 
information used in developing the final interim approvals 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: For information on San Luis Obispo's 
program, contact Frances Wicher (telephone: 415/744-1250), Mail Code A-
5-2, U.S. Environmental Protection Agency, Region IX, Air & Toxics 
Division, 75 Hawthorne Street, San Francisco, CA 94105. For information 
on Santa Barbara's program or Ventura's program, contact Martha Larson 
(telephone: 415/744-1238) at the same address.

SUPPLEMENTARY INFORMATION:

I. Background and Purpose

    Title V of the 1990 Clean Air Act Amendments (sections 501-507 of 
the Act), and implementing regulations at 40 Code of Federal 
Regulations (CFR) 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 

[[Page 55461]]
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.
    EPA proposed interim approval of San Luis Obispo's title V 
operating permits program on September 1, 1995 (60 FR 45685), Santa 
Barbara's program on July 10, 1995 (60 FR 35538), and Ventura's program 
on November 22, 1994 (59 FR 60104). In these Federal Register 
documents, EPA also proposed approval of each District's interim 
mechanism for implementing sections 112(g) and, under 112(l), its 
program for delegation of section 112 standards as promulgated. Public 
comment was solicited on all these proposed actions. EPA received 
comments on the proposed approval of Santa Barbara's and Ventura's 
operating permits program and is responding to these comments in this 
document. EPA did not receive any comments on its proposed interim 
approval of San Luis Obispo's program. The proposed actions to 
interimly approve the Districts' operating permit programs and approve 
their 112(g) and delegation mechanisms have not been altered as a 
result of public comment.

II. Final Action and Implications

A. Analysis of State Submissions

    San Luis Obispo's title V operating permits program was submitted 
by the California Air Resources Board (CARB) on November 15, 1993. 
Additional material was submitted on February 18, 1994, and May 3, May 
23 and August 21, 1995.
    Santa Barbara's title V operating permits program was submitted by 
the CARB on November 15, 1993. Additional material was submitted on 
March 2, August 8, and December 8, 1994, and June 15, 1995.
    Ventura's title V operating permits program was submitted by CARB 
on November 16, 1993. Additional material was submitted on December 6, 
1993. Since the time that EPA proposed interim approval, Ventura has 
adopted regulations to implement title IV of the Act. On March 14, 
1995, Ventura incorporated part 72 by reference into District Rule 34. 
Rule 34 was submitted to EPA on April 28, 1995.
    EPA proposed interim approval of each District's program in 
accordance with Sec. 70.4(d), on the basis that the program 
``substantially meets'' part 70 requirements. The analyses of the 
Districts' programs in the proposed approvals remain unchanged and will 
not be repeated in this final document. The program deficiencies 
identified for each program in the proposed approvals also remain 
unchanged except for a change to Santa Barbara's interim approval issue 
related to the definition of title I modifications. This change is 
discussed in II.B.1.b. below. Each District must correct the program 
deficiencies listed in its proposed interim approval in order to 
receive full approval.
    At the time of proposals for each District, EPA believed that an 
implementation agreement between EPA and each District would be 
completed prior to final interim approval. EPA and the Districts have 
not yet finalized implementation agreements but are working to do so as 
soon as practicable.

B. Public Comment

    EPA received comments on the proposed interim approvals for Santa 
Barbara and Ventura. No comments were received on the proposed interim 
approval for San Luis Obispo.
1. Comments on the Proposed Interim Approval for Santa Barbara
    EPA received comments on the proposed interim approval of the Santa 
Barbara program from two public commenters: Vandenberg Air Force Base 
(Vandenberg), and the Santa Barbara County Air Pollution Control 
District. These comments are discussed below.
    a. Insignificant Activities. Vandenberg submitted comments 
regarding EPA's discussion of insignificant activities in the July 10, 
1995 proposal notice. Primarily, Vandenberg requested that EPA clarify 
the requirements that Santa Barbara must meet with respect to 
insignificant activities for full approval of its part 70 program. 
Vandenberg commented that, because of the size of the Air Force Base, 
determinations of insignificant activities based on potential emissions 
and based on source category emissions rather than unit emissions would 
be burdensome, because the aggregated source-category emissions at 
Vandenberg would prevent any units from being determined to be 
insignificant. Vandenberg specifically asked (1) whether EPA required 
Santa Barbara to include insignificant emission levels and other 
``gatekeepers'' in Rule XIII as well as providing documentation 
demonstrating that the activities listed in Rule 202 are insignificant, 
(2) whether the insignificant emission levels may be expressed in terms 
of actual emissions, and (3) whether insignificant emission levels were 
intended to be applied on a device basis or on a source category basis.
    Section 70.4(b)(2) requires States to include in their part 70 
programs any criteria used to determine insignificant activities or 
emission levels for the purpose of determining complete 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. Santa Barbara submitted District Rule 
202, its current permit exemption rule, as its list of insignificant 
activities. Santa Barbara did not provide EPA with criteria used to 
develop the exemptions list, information on the level of emissions from 
the activities, or with a demonstration that these activities are not 
likely to be subject to an applicable requirement.
    Santa Barbara has two options with regards to insignificant 
activities. Under one option, Santa Barbara would provide a 
demonstration that activities exempted from permitting under Rule XIII 
(pursuant to Rule 202, the District's permit exemption list) are truly 
insignificant and are not likely to be subject to an applicable 
requirement. Santa Barbara's alternative would be to revise Rule XIII 
to include a restriction that may be used in conjunction with Rule 202 
to define insignificant activities. Rule XIII would be revised to 
include District-established emission levels. These District-
established levels must include separate emission levels for HAPs and 
for other regulated air pollutants. Santa Barbara would then only have 
to demonstrate that these emission levels are insignificant compared to 
the level of emissions from and type of units that are required to be 
permitted or subject to applicable requirements.
    The District may establish insignificant emission levels in terms 
of actual or potential emissions, and may define insignificant 
activities either on a unit-by-unit basis, or a source-category basis. 
The emission levels, in conjunction with the insignificant activity 
list and the Sec. 70.5(c) requirement that applications may not omit 
information needed to determine the applicability of, or to impose, any 
applicable requirement, or to evaluate the fees, would be used to 
define insignificant activities. Also note that emissions from 
insignificant activities must be included in determining whether a 
facility is a major source subject to title V.
    In the proposed rulemaking EPA suggested insignificance levels that 
the 

[[Page 55462]]
Agency would find acceptable without a further demonstration. EPA's 
limits are provided as an example of what may be acceptable. However, 
EPA clearly stated in the proposal notice that our request for comment 
on these proposed levels is not intended to restrict the ability of the 
District to propose and EPA to approve other emission levels if the 
District demonstrates that such alternative emission levels are 
insignificant compared to the levels of emission from types of units 
that are permitted or subject to applicable requirements.
    EPA would like to note that Santa Barbara has the flexibility to 
modify its regulations and submit criteria for EPA approval of new 
exemptions, as long as the District demonstrates, or EPA is otherwise 
satisfied, that such alternative emission levels are insignificant 
compared to the level of emissions and types of units that are required 
to be permitted or subject to applicable requirements. EPA is not 
prohibiting Santa Barbara from setting its own limits, as long as 
limits are demonstrated to be truly insignificant and the activities or 
units are not likely to be subject to applicable requirements. With 
this understanding, one of Santa Barbara's options would be to revise 
its Rule 1301 definitions of ``insignificant emissions'' and 
``insignificant emission levels'' to meet the part 70 requirements and 
to link the two definitions, so that insignificant emission levels are 
defined as criteria for determining insignificant activities. An option 
for revising Santa Barbara's definition of ``insignificant emission 
levels'' would be ```Insignificant Emissions Levels' mean the emission 
levels that, for regulated air pollutants, are exempt from District 
permitting pursuant to Section A.3. of District Rule 202 and 
additionally for HAPs, do not exceed Section 112(g) de minimis levels 
or other title I significant modification levels for hazardous air 
pollutants and other toxics.''
    b. Title I Modifications. The July 10, 1995 proposal notice 
identified Santa Barbara's omission of certain part 60 modifications 
from the definitions of ``title I (or major) modification'' and 
``significant part 70 permit revision'' as an interim approval issue. 
See 60 FR 35538. Based on a June 15, 1995 commitment letter from Santa 
Barbara, EPA proposed that Santa Barbara must correct these definitions 
for full approval. Additionally, EPA required that Santa Barbara 
provide interpretive guidance demonstrating that all modifications 
under part 60 will be treated as significant permit modifications in 
order to receive final interim approval.
    Santa Barbara commented to request that its final interim approval 
not be conditioned upon the District's issuing interpretive guidance 
explaining how all modifications under part 60 would be treated as 
significant permit modifications. Santa Barbara reiterated its June 15, 
1995 commitment to issue this guidance. However, citing program rules, 
the District stated that it could not undertake this kind of activity 
prior to EPA's final interim approval of its part 70 operating permits 
program. Santa Barbara committed to having the interpretive guidance in 
place prior to revising any part 70 permits involving modifications 
under part 60.
    Santa Barbara's definition of ``title I modification'' does not 
include modifications under part 60. Santa Barbara's definition of 
``significant part 70 permit modification'' includes only ``Any 
equivalent or identical replacement of an emission unit that is subject 
to standards promulgated under CAA, section 111 or 112.'' Therefore, 
Santa Barbara's rule would not require all modifications under part 60 
to be processed as significant permit revisions. Part 70 requires all 
modifications under title I of the Act to be processed as significant 
permit modifications (Sec. 70.7(e)(2)(i)(A)(5)). EPA's initial part 70 
proposal (56 FR 21712) identified part 60 modifications as title I 
modifications.
    Neither EPA's August 29, 1994 proposed revisions to part 70 (59 FR 
44460) nor EPA's August 31, 1995 supplemental proposal (60 FR 45530) 
removes part 60 from the definition of ``title I modifications.'' The 
August 31, 1995 notice's proposed definition of ``title I 
modification'' includes a reference to 111(a)(4), which is the enabling 
legislation for part 60 modifications: ``Title I modification or 
modification under any provision of title I of the Act means any 
modification under parts C and D of title I or sections 111(a)(4), 
112(a)(5), or 112(g) of the Act; under regulations promulgated by EPA 
thereunder or in 61.07 of part 61 of this chapter; or under State 
regulations approved by EPA to meet such requirements.'' EPA has 
determined that inclusion of part 60 modifications under the definition 
of title I modification, and thus under the definition of significant 
part 70 modification, is necessary for full approval. In the July 10, 
1995 notice proposing interim approval of Santa Barbara's rule, EPA 
proposed that the interpretive guidance be issued prior to any permit 
modifications, and therefore required the issuance of this guidance as 
a condition of final interim approval. However, EPA is confident that, 
based on Santa Barbara's June 15, 1995 and August 9, 1995 commitments, 
Santa Barbara will implement its rule consistently with part 70's 
definition of title I modification. Through oversight, EPA will monitor 
the District's rule implementation, and any permit modification that 
does not treat part 60 modifications as significant permit 
modifications is subject to EPA objection. Therefore, EPA has 
determined that Santa Barbara's commitment is adequate for final 
interim approval.
2. Comments on the Proposed Interim Approval for Ventura
    EPA received comments on the proposed interim approval of the 
Ventura County program from four public commenters: the National 
Environmental Development Association Clean Air Regulatory Project 
(NEDA/CARP), the American Forest & Paper Association (AF&PA), the 
California Air Resource Board (CARB), and the Ventura County Air 
Pollution Control District (APCD).
    a. Section 112(g) Implementation. The APCD comments expressed 
concerns with implementing a 112(g) program prior to EPA's promulgation 
of 112(g) guidance. AF&PA and NEDA/CARP also commented that EPA should 
not approve use of the District's preconstruction permitting program 
for the purposes of implementing 112(g) prior to EPA's promulgation of 
a 112(g) rule. The AF&PA and NEDA/CARP objected to the implementation 
of 112(g) without EPA's guidance on de minimis emission increases, 
offsets, and applicability under 112(g). The AF&PA and NEDA/CARP 
believe that the District would not be able to appropriately determine 
applicability of MACT standards prior to promulgation of the 112(g) 
rule. AF&PA stated that the lack of guidance would cause the District 
to implement a 112(g) program in such a manner that could unfairly put 
sources at risk of enforcement action if it was later found that the 
District's implementation of 112(g) was not consistent with EPA's 
112(g) rule.
    Section 112(g)(2) of the Clean Air Act prohibits the construction, 
reconstruction, and modification of any major source of hazardous air 
pollutants after the effective date of a title V program unless the 
source meets MACT. EPA received many comments on 112(g) implementation 
and agrees that it is not reasonable to expect the States and Districts 
to implement section 112(g) before a Federal 112(g) rule is issued. EPA 
has therefore published an interpretive notice in the Federal Register 
regarding section 112(g) of the Act. 60 FR 8333 (February 14, 1995). 

[[Page 55463]]
The interpretive notice outlines EPA's revised interpretation of 
section 112(g) applicability prior to EPA's issuing the final section 
112(g) rule. The interpretive notice allows State and local agencies to 
decide whether to delay implementing 112(g) of the Act until EPA 
promulgates a final 112(g) rule unless they choose to implement the 
requirements of 112(g) as a matter of state or local law prior to EPA 
promulgation of the 112(g) rule. Major source modifications, 
constructions, and reconstructions will not be subject to section 
112(g) requirements until the final rule is promulgated.
    The interpretive notice further 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 
the effective date of section 112(g), Ventura 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. 
Therefore, EPA is approving the use of Ventura's preconstruction 
program as an interim mechanism, as proposed.
    However, since approval is intended solely 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 APCD and CARB commented that EPA should allow at least 18 
months, rather than 12 months, to develop section 112(g) regulations 
following EPA's promulgation of the Federal section 112(g) rule. The 
District stated that 12 months may not be sufficient time to both 
undergo the regulatory development process and prepare a section 112(l) 
equivalency package for approval of the District's regulation to be 
used in lieu of the Federal 112(g) rule. Additionally, CARB commented 
that, contingent upon a District submitting a 112(l) equivalency 
package within 18 months of EPA's promulgation of a 112(g) rule, EPA 
should extend the interim approval of the District's preconstruction 
permit program for implementing a 112(g) program until EPA has finally 
approved or disapproved the District's 112(l) submittal.
    EPA has approved an 18-month transition period in other states and 
does not see a unique reason to limit Ventura, Santa Barbara or San 
Luis Obispo to 12 months. If in the final section 112(g) rule, however, 
the transition period is eliminated, the Districts must follow the 
implementation time lines set out in that rulemaking. In addition, EPA 
believes that, in most cases, 18 months will be an adequate period of 
time for (1) districts to adopt a 112(g) rule, (2) districts to make a 
complete submittal, (3) EPA to determine the submittal complete, and 
(4) EPA to approve the submittal under 112(l). Under EPA's 112(l) rule 
(``Approval of State Programs and Delegation of Federal Authority,'' 58 
FR 62262), EPA is required to process a submittal within 6 months of 
determining the submittal complete. EPA believes that approval of a 
longer time period could inappropriately delay implementation of a 
112(g) program.
    b. Insignificant Activities. The APCD commented that the District's 
categorical permit exemption list should be accepted as its list of 
insignificant activities. The APCD stated that the list was a result of 
the District's experience over many years, and so represents the best 
approach to determining insignificant activities. AF&PA and NEDA/CARP 
also recommend that the District's current list be accepted.
    EPA recognizes that information about insignificant emissions units 
may not be needed in some cases to assure compliance with all 
applicable requirements or to determine applicability. Therefore, part 
70 allows state and local agencies to submit a list for approval of 
insignificant activities and emissions levels. This list must be 
accompanied with some sort of justification or selection criteria that 
assure insignificance with respect to Federal applicable requirements 
(section 70.4(b)(2)). The fact that the District has a preexisting 
exemption list does not constitute sufficient justification. As stated 
in the proposal, Ventura's program provided EPA with no criteria or 
information on the level of emissions from activities on the District's 
exemption lists. In addition, the specific insignificant activities 
provisions submitted by Ventura have raised concerns with EPA regarding 
the District's ability to ensure that applicable requirements are 
included in permits. Ventura did not provide EPA with a demonstration 
to the contrary. Because Ventura has not provided EPA with 
justification for each categorical exemption, EPA does not have 
adequate information on which to evaluate the activities, and cannot 
approve the District's exemption list.
    The APCD commented that EPA's requirement that emission levels be 
set is impractical, because levels based on potential emissions would 
exempt few sources, while levels based on actual emissions would 
require that sources keep records to demonstrate emissions are below 
the levels, which would be burdensome.
    EPA disagrees that setting emission levels is impractical or 
burdensome. These emission levels could be evaluated based on actual 
emissions, although demonstrations could also be made based upon 
potential emissions. Nothing in part 70 requires sources to keep 
ongoing records to demonstrate eligibility for insignificant activity 
status.
    AF&PA and NEDA/CARP commented that EPA's suggested ``acceptable'' 
emissions levels are too stringent, and that EPA is not providing the 
District opportunity to define alternative thresholds, and that EPA has 
no authority to hold out ``suggested'' emission levels as a threshold 
for receiving full approval.
    In the proposed rulemaking EPA suggested insignificance levels that 
the Agency would find acceptable even without a further demonstration. 
EPA's limits are provided as an example of what may be acceptable. 
However, EPA clearly stated in the proposal notice that its request for 
comment on these proposed levels ``is not intended to restrict the 
ability of the District to propose and EPA to approve other emission 
levels if the District demonstrates that such alternative emission 
levels are insignificant compared to the levels of emission from types 
of units that are permitted or subject to applicable requirements.''
    EPA would like to note that Ventura has the flexibility to modify 
its regulations and submit criteria for EPA approval of new exemptions, 
as long as the District demonstrates, or EPA is otherwise satisfied, 
that such alternative emission levels are insignificant compared to the 
level of emissions and types of units that are permitted or subject to 
applicable requirements. EPA is not prohibiting Ventura from setting 
its own limits, as long as limits are demonstrated to be truly 
insignificant and not likely to be subject to an applicable 
requirement.
    c. Title I Modifications. Ventura commented that ``title I 
modifications'' should not be interpreted to include minor NSR. NEDA/
CARP and AF&PA supported EPA's decision that inclusion of minor NSR in 
the definition of ``title I modification'' not be an interim approval 
issue. 

[[Page 55464]]

    NEDA/CARP and AF&PA both contend that neither EPA nor the District 
has authority to include as ``title I modifications'' those changes 
made pursuant to a preconstruction permitting program approved under 
the SIP. Furthermore, the commenters state that requiring Ventura's 
program regulations to include the more encompassing definition of 
``title I modification'' would constitute a revision to the Agency's 
current operating permits rule. However, both commenters support EPA's 
position of not making title I modifications an issue in granting 
interim approval to Ventura's title V program, and therefore are not 
asking for any changes to be made.
    In an August 29, 1994 rulemaking proposal, the Agency solicited 
public comment on whether ``title I modifications'' 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 is published in a supplemental 
rulemaking proposal in the Federal Register. 60 FR 45530 (August 31, 
1995). Thus, EPA expects to confirm that Ventura'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.
    d. Emissions Trading. AF&PA and NEDA/CARP supported EPA's 
identification of emission trading as an interim approval issue. The 
commenters agreed that Ventura should be required to revise its 
regulation to provide for emission trading where an applicable 
requirement provides for trading increases and decreases without a 
case-by-case approval as a condition of full program approval. Ventura 
has commented that the District plans to revise its regulations to 
include applicable requirement emission trading.
    e. Significant Changes to Monitoring Terms and Conditions. Ventura 
requested EPA's guidance in defining ``significant'' with respect to 
changes to monitoring terms and conditions. AF&PA and NEDA/CARP 
commented that this change should not be an interim approval issue, for 
the reasons that EPA has not adequately defined ``significant'' for 
these purposes, and because EPA has requested public comment on more 
flexible requirements for permit modifications due to significant 
changes to monitoring terms and conditions.
    Part 70 does not specifically define ``significant'' with respect 
to significant modifications to monitoring terms and conditions. This 
gives permitting authorities discretion in determining which changes 
are considered to be ``significant.'' Part 70 does distinguish between 
``significant'' changes, and ``relaxations'' to other types of 
permitting terms and conditions. Significant permit changes would 
encompass relaxations and other changes. EPA has not specifically 
defined the term ``significant''; however, EPA has given examples of 
how changes in monitoring terms and conditions would be classified with 
respect to permit modification tracks in EPA's response to comments on 
the proposed part 70 rule, (see ``Response to Comments on the 40 CFR 
Part 70 Rulemaking,'' Docket No. A-90-33), and also in the final part 
70 rule.
    EPA does not agree that this deficiency should be dropped as an 
interim approval issue pending the revisions to part 70. EPA proposed, 
in the August 31, 1995 Federal Register, to revise current part 70 
requirements for permit modifications. See 60 FR 45530. However, EPA 
must approve current programs according to the existing part 70 rule 
until the time that the part 70 program is revised. Therefore, this 
remains an interim approval issue.
    f. Modifications Prior to Permit Conditions. The APCD commented 
that requiring permit revisions to be made prior to the actual 
modifications is impractical because implementation of the actual 
change may necessitate further changes to the permit.
    This comment goes to the structure of part 70 rather than the 
approvability of Ventura's program. Therefore, EPA believes that no 
change to EPA's proposed action on the approvability of Ventura's title 
V program is required in response to this comment. On August 31, 1995, 
EPA proposed a supplement to part 70 that includes revisions to the 
current permit modification procedures, with the opportunity for public 
comment (60 FR 45530). However, until revisions to part 70 are 
promulgated, all part 70 programs must be consistent with the current 
part 70 rule, which requires that, unless modifications are subject to 
section 112(g) or title I, parts C and D of the Act, and are not 
prohibited by the existing part 70 permit, significant permit 
modifications must be approved prior to their implementation.

B. Final Action

1. Interim Approvals
    EPA is promulgating interim approval of the operating permit 
programs for San Luis Obispo County, Santa Barbara County, and Ventura 
County, California. The part 70 programs approved in this document 
apply to all part 70 sources (as defined in the approved program) 
within the each District including any title V sources on the outer 
continental shelf within 25 miles of shore, except any sources of air 
pollution over which an Indian Tribe has jurisdiction. See, e.g., 59 FR 
55813, 55815-55818 (November 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 
43956, 43962 (Aug. 25, 1994); 58 FR 54364 (Oct. 21, 1993).
    These interim approvals, which may not be renewed, extend until 
December 1, 1997. During this interim approval period, each District is 
protected from sanctions, and EPA is not obligated to promulgate, 
administer and enforce a Federal operating permits program in any of 
these Districts. Permits issued under a program with interim approval 
have full standing with respect to part 70, and the 1-year time period 
for submittal of permit applications by subject sources begins upon the 
effective date of this interim approval, as does the 3-year time period 
for 

[[Page 55465]]
processing the initial permit applications.
    If any of the three Districts fails to submit a complete corrective 
program for full approval by June 2, 1997, EPA will start an 18-month 
clock for mandatory sanctions for that District. If the District 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 to the District and that 
sanction will remain in effect until EPA determines that the District 
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 District, both sanctions under section 179(b) will 
apply after the expiration of the 18-month period until the 
Administrator determines that the District has come into compliance. In 
any case, if, six months after application of the first sanction, the 
District still has not submitted a corrective program that EPA has 
found complete, a second sanction will be required.
    If EPA disapproves a District'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 District has submitted a revised program and EPA 
has determined that it corrected the deficiencies that prompted the 
disapproval. Moreover, if the Administrator finds a lack of good faith 
on the part of the District, both sanctions under section 179(b) shall 
apply after the expiration of the 18-month period until the 
Administrator determines that the District has come into compliance. In 
all cases, if, six months after EPA applies the first sanction, the 
District 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 
District has not submitted a timely and complete corrective program or 
EPA has disapproved its submitted corrective program. Moreover, if EPA 
has not granted full approval to the District's 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 District upon interim approval 
expiration.
    a. San Luis Obispo's Title V Operating Permits Program. The EPA is 
promulgating interim approval of San Luis Obispo's title V operating 
permits program. The program deficiencies described in the proposed 
rulemaking, under Section II.B.2., Interim Approval Issues for San Luis 
Obispo's Title V Operating Permits Program, and the legislative 
deficiency outlined under Section II.B.3., California Enabling 
Legislation--Legislative Source Category Limited Interim Approval Issue 
(see 60 FR 45685 (September 1, 1995)), must be corrected in order for 
the District to be granted full approval.
    b. Santa Barbara's Title V Operating Permits Program. EPA is 
promulgating interim approval of Santa Barbara's operating permits 
program submitted on November 15, 1993, and amended March 2, August 8, 
and December 8, 1994, and June 15, 1995. Excepted as noted below, the 
program deficiencies described in the proposed rulemaking, under 
Section II.B.1., Santa Barbara's Title V Operating Permits Program, and 
the legislative deficiency outlined under Section II.B.2., California 
Enabling Legislation--Legislative Source Category Limited Interim 
Approval Issue (see 60 FR 35538 (July 10, 1995)), must be corrected in 
order for the District to be granted full approval. In response to 
comments received, EPA has modified the interim approval issued related 
to the definition of title I modifications (Issue m in the proposal). 
In addition to the other interim approval issues noted in the proposed 
approval, the District must make the following change to receive full 
approval:
Definition of Title I Modifications and Significant Part 70 Permit 
Modifications
    Rule 1301 defines ``modification'' to include all modifications 
under 40 CFR part 60. However, the definitions of ``title I (or major) 
modification'' and ``significant part 70 permit modification'' do not 
clearly define all modifications under part 60 as title I modifications 
and do not clearly ensure they will be treated as significant permit 
modifications. See discussion in Section II.B.1.b. of this notice. 
Santa Barbara submitted a June 15, 1995 letter from Peter Cantle, 
Engineering Division Manager, Santa Barbara County Air Pollution 
Control District, committing to provide interpretive guidance 
demonstrating that all modifications under 40 CFR part 60 will be 
treated as significant permit modifications. In order to receive full 
approval, Santa Barbara must finalize and submit to EPA interpretive 
guidance demonstrating that all modifications under 40 CFR part 60 will 
be treated as significant permit modifications. Additionally, in order 
to receive full approval, Santa Barbara must clarify the definitions of 
``title I (or major) modification'' and ``significant part 70 permit 
modification'' to include all modifications under 40 CFR part 60.
    c. Ventura's Title V Operating Permits Program. The EPA is 
promulgating interim approval of Ventura's operating permits program 
submitted on November 16, 1993 and amended December 6, 1993. The 
program deficiencies described in the proposed rulemaking, under 
Section II.B.1., Ventura's Title V Operating Permits Program, and the 
legislative deficiency outlined under Section II.B.2., California 
Enabling Legislation--Legislative Source Category Limited Interim 
Approval Issue (see 59 FR 60104 (November 22, 1994)), must be corrected 
in order for the District to be granted full approval.
2. Districts' Preconstruction Permit Program Implementing Section 
112(g)
    EPA is approving the use of each District's preconstruction review 
program as a mechanism to implement section 112(g) during the 
transition period between promulgation of EPA's section 112(g) rule and 
adoption by each District of rules specifically designed to implement 
section 112(g). EPA is limiting the duration of this approval to 18 
months following promulgation by EPA of the section 112(g) rule.
3. Program for Delegation of Section 112 Standards as Promulgated
    Requirements for part 70 program approval, specified in 40 CFR 
section 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 a 
permitting authority's title V program contain adequate authorities, 
adequate resources for implementation, and an expeditious compliance 
schedule, which are also requirements under part 70. Therefore, EPA is 
also promulgating approval under section 112(l)(5) and 40 CFR section 
63.91 of each of the District's programs for receiving delegation of 
section 112 standards that are unchanged from the federal standards as 
promulgated. These programs for delegations apply to both existing and 
future standards but is limited to sources covered by the part 70 
program.

III. Administrative Requirements

A. Docket

    Copies of submittal for San Luis Obispo, Santa Barbara, and Ventura 
as well as other information relied upon 

[[Page 55466]]
for the final interim approvals are contained in docket numbers CA-SLO-
95-01-OPS (for San Luis Obispo), CA-SB-95-1-OPS (for Santa Barbara), 
and CA-VT-94-1-OPS (for Ventura) maintained at the EPA Regional Office. 
Each 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 dockets are 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 sections 502 and 112 of the Act do not 
create any new requirements, but simply address operating permit 
programs submitted to satisfy the requirements of 40 CFR part 70. 
Because these actions do not impose any new requirements, they do not 
have a significant impact on a substantial number of small entities.

D. Unfunded Mandates

    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 interim 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 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, Hazardous substances, Intergovernmental 
relations, Operating permits, Reporting and recordkeeping requirements.

    Dated: October 23, 1995.
Felicia Marcus,
Regional Administrator.

    Part 70, 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 paragraphs (z), (aa), 
and (gg) to the entry for California to read as follows:

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

* * * * *

California

    The following district program was submitted by the California 
Air Resources Board on behalf of:
* * * * *
    (z) San Luis Obispo County APCD (complete submittal received on 
November 16, 1995); interim approval effective on December 1, 1995; 
interim approval expires December 1, 1997.
    (aa) Santa Barbara County Air Pollution Control District (APCD) 
submitted on November 15, 1993, as amended March 2, 1994, August 8, 
1994, December 8, 1994, and June 15, 1995; interim approval 
effective on December 1, 1995; interim approval expires December 1, 
1997.
* * * * *
    (gg) Ventura County Air Pollution Control District (APCD) 
submitted on November 16, 1993, as amended December 6, 1993; interim 
approval effective on December 1, 1995; interim approval expires 
December 1, 1997.
* * * * *
[FR Doc. 95-27142 Filed 10-31-95; 8:45 am]
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