[Federal Register Volume 61, Number 78 (Monday, April 22, 1996)]
[Proposed Rules]
[Pages 17669-17675]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-9914]



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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[OH96-1; FRL-5462-1]


Proposed Approval and Promulgation of Revisions to the New Source 
Review State Implementation Plan; Ohio

AGENCY: United States Environmental Protection Agency (USEPA).

ACTION: Proposed rule.

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SUMMARY: The USEPA proposes to conditionally approve a requested State 
Implementation Plan (SIP) revision submitted by the State of Ohio for 
the purpose of meeting requirements of the Clean Air Act, as amended in 
1990 (CAA) with regard to new source review (NSR) in areas that have 
not attained the national ambient air quality standards (NAAQS). The 
requested revision was submitted by the State to satisfy certain 
Federal requirements for an approvable nonattainment new source review 
SIP. This proposed conditional approval is based upon the State's 
agreeing with two USEPA interpretations of the Ohio rules and a 
commitment by the State to remedy the omission of a definition for

[[Page 17670]]

``Pollution Control Project'' in its NSR rules.

DATES: Comments on this proposed action must be received in writing by 
June 21, 1996.

ADDRESSES: Comments on this proposed rule should be addressed to: J. 
Elmer Bortzer, Chief, Regulation Development Section, Air Programs 
Branch (5AR-18J), United States Environmental Protection Agency, Region 
5, 77 West Jackson Boulevard, Chicago, Illinois 60604.
    Copies of the State's submittal and other information are available 
for inspection during normal business hours at the following location: 
United States Environmental Protection Agency, Region 5, Air and 
Radiation Division, Air Programs Branch, 77 West Jackson Boulevard, 
Chicago, Illinois 60604.

FOR FURTHER INFORMATION CONTACT: Genevieve Nearmyer, Environmental 
Engineer, Permits and Grants Section, Air Programs Branch, (5AR-18J), 
United States Environmental Protection Agency, Region 5, 77 West 
Jackson Boulevard, Chicago, Illinois 60604.
    Anyone wishing to come to the Region 5 offices should first contact 
Ms. Nearmyer at (312) 353-4761. Reference file OH96.

SUPPLEMENTARY INFORMATION:

I. Background

    The air quality planning requirements for nonattainment NSR are set 
out in part D of title I of the CAA. The USEPA has issued a ``General 
Preamble'' describing its preliminary views on how USEPA 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 USEPA 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 
proposal and the supporting rationale regarding the approvability of 
the submittals. Prior to USEPA's approval of a State's NSR SIP 
submittal, 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, USEPA 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 apply 40 CFR part 51, 
appendix S for newly designated areas that did not previously have NSR 
SIP requirements.
    The September 3 memorandum also addressed the situation where 
States did not submit the part D NSR SIP requirements or revisions by 
the applicable statutory deadline. For permit applications found 
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, USEPA will consider the source to be in compliance 
with the CAA only where the source obtains from the State a permit that 
is consistent with the substantive new NSR part D provisions in the 
CAA. USEPA believes this guidance continues to apply to permitting 
pending final action on NSR SIP submittals.
    In this rulemaking action on the Ohio nonattainment NSR SIP 
revisions, USEPA is proposing to apply its interpretations taking into 
consideration the specific factual issues presented. Thus, USEPA will 
consider any timely submitted comments before taking final action on 
this proposed rule.

II. Review of the Ohio Submittal

    Section 110(k) of the Act sets out provisions governing USEPA's 
review of SIP submittals [see 57 FR 13565-66 (April 16, 1992)].

A. Analysis of State Submission

1. Procedural Background
    The CAA requires States to observe certain procedural requirements 
in developing implementation plans and plan revisions for submission to 
USEPA. Section 110(a)(2) of the CAA provides that each implementation 
plan submitted by a State must be adopted after reasonable notice and 
public hearing.1 Section 110(l) of the CAA 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 CAA provides that plan provisions 
for nonattainment areas shall meet the applicable provisions of 
section 110(a)(2) of the CAA.
---------------------------------------------------------------------------

    The USEPA also must determine whether a submittal is complete and 
therefore warrants further USEPA review and action. [See section 
110(k)(1) and 57 FR 13565 (April 16, 1992).] The USEPA's completeness 
criteria for SIP submittals are set out at 40 CFR part 51, appendix V. 
The USEPA attempts to make completeness determinations within 60 days 
of receiving a submittal. However, a submittal is deemed complete by 
operation of law under section 110(k)(1)(B) of the CAA if a 
completeness determination is not made by USEPA within 6 months after 
receipt of the submission.
    It should be noted that Ohio's initial NSR SIP submittal was 
submitted in response to the part D requirements in 1977 Amendments to 
the CAA. USEPA approved these provisions on October 31, 1980 (45 FR 
72119). The State SIP submittal that is the subject of this proposed 
rule concerns amendments to the earlier rules to satisfy the 
requirements of the 1990 Amendments to the CAA. Ohio's previous attempt 
at satisfying these additional with a submittal to USEPA on August 20, 
1993 ended in final disapproval by USEPA on September 21, 1994 (59 FR 
48392). This final rule initiated the sanctions process as discussed 
below.
    The State of Ohio submitted draft NSR rules to USEPA for parallel 
processing on March 1, 1996. Parallel processing is a mechanism 
developed to expedite USEPA action and a State SIP revision request. 
Under parallel processing, the State submits its rules to USEPA when 
their substance has been finalized but before they become finally 
adopted by the State. The USEPA then initiates its analysis and rule 
adoption process on the draft State rules. Although final action on the 
requested SIP revision cannot occur until the rules are adopted and 
effective, the time between final adoption by the State and approval by 
USEPA is shortened because USEPA begins its review and approval process 
before the State completes its rule adoption process.
    The State of Ohio held a public hearing on January 6, 1996, to 
provide the public an opportunity to present oral comments on the NSR 
implementation plan revisions. After the public hearing the rules were 
filed with the legislative rules committee. They were adopted by the 
State and became effective on April 12, 1996, and submitted to USEPA on 
April 12, 1996 as a requested revision to the SIP. Although the 
requested SIP revision includes both NSR rules and attainment area 
rules intended to provide for Prevention of Significant Deterioration 
(PSD), at this time USEPA is only rulemaking on the Ohio NSR rules. The 
PSD rules will be the subject of a separate action.

[[Page 17671]]

 2. General Nonattainment NSR Requirements
    The statutory requirements for nonattainment new source review SIPs 
and permitting are found at sections 172 and 173 of the CAA. Part D of 
title I of the CAA requires States to address a number of nonattainment 
NSR provisions in a SIP revision submittal. These statutory 
requirements have been supplemented with more detailed regulations 
which have been codified at section 51.165 of title 40 of the Code of 
Federal Regulations (40 CFR 51.165). What follows is a summary of how 
the Ohio submittal addresses and satisfies each of the requirements for 
an approvable NSR plan. A more detailed presentation is provided in 
this proposed rule only in those areas where the Ohio submittal has not 
clearly satisfied the requirements for approval. USEPA's complete 
evaluation of the Ohio NSR Plan is contained in a technical support 
document which is available at the Region 5 office listed in the 
address section of this proposed rule.
    a. Ohio has established provisions in response to section 173(a)(1) 
of the CAA to assure that calculations of emissions offsets are based 
on the same emissions baseline used in the demonstration of Reasonable 
Further Progress (RFP). These provisions satisfy USEPA's requirements 
for approval.
    b. Ohio has established provisions in response to section 173(c)(1) 
of the CAA to allow offsets to be obtained in another nonattainment 
area if the area has an equal or higher nonattainment classification 
and emissions from the other nonattainment area contribute to a NAAQS 
violation in the area in which the source would construct. These 
provisions satisfy USEPA's requirements for approval.
    c. Ohio has established provisions in response to section 173(c)(1) 
of the CAA which 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. These provisions satisfy USEPA's 
requirements for approval.
    d. Ohio has established provisions in response to section 173(c)(1) 
of the CAA to assure that emissions increases from new or modified 
sources are offset by real reductions in actual emissions. These 
provisions satisfy USEPA's requirements for approval.
    e. Section 173(c)(2) of the CAA prevents emission offsets from 
being taken from reductions that are otherwise required by the CAA. 
Such prohibitions are not expressly identified in Ohio Rule 3745-31-
22(A)(3) Emission Offsets. However, in the general provisions covering 
all installation permits, Rule 3745-31-05(A)(2), a permit must not 
violate any applicable laws. The term ``applicable laws'' is defined in 
Rule 3745-31-01(f) as including provisions of the CAA. The USEPA views 
this provision as effectively preventing the State from using emission 
offsets from reductions otherwise required by the CAA. Ohio has 
confirmed that USEPA's interpretation of the term ``applicable laws'', 
is the same interpretation that the State uses in a April 12, 1996 
letter; therefore, USEPA believes that this provision of the State rule 
satisfies the approval requirements of section 173(c)(2) of the CAA.
    f. Ohio has established provisions in response to sections 
172(c)(4) and 173(a)(1)(B) of the CAA that reflect changes in growth 
allowances; specifically, (1) the elimination of existing growth 
allowances in any nonattainment area that received a notice prior to 
the amended CAA that the SIP was substantially inadequate or receives 
such a notice in the future; and (2) the restriction of growth 
allowances to only those portions of nonattainment areas formally 
targeted as special zones for economic development. These provisions 
satisfy USEPA's requirements for approval.
    g. Ohio has provided for the supplying of information from 
nonattainment new source review permits to USEPA's Reasonably Available 
Control Technology, Best Available Control Technology, Lowest 
Achievable Emissions Reduction (RACT/BACT/LAER) clearinghouse in 
response to the requirement in section 173(d) of the CAA. This 
provision which is contained in the State's workplan of its NSR grant 
satisfies USEPA's requirement for approval.
    h. Ohio has established provisions in response to section 819 of 
the CAA that effectively exempt activities related to stripper wells 
from the new additional NSR requirements of subparts 2, 3, and 4 for 
Particulate Matter of 10 microns or less (PM-10), Ozone, or Carbon 
Monoxide (CO) nonattainment areas classified as serious or less and 
having a population of less than 350,000. Although Ohio does not intend 
to issue permits to stripper wells, Ohio's rules are consistent with 
the requirements of the CAA and satisfy USEPA's requirements for 
approval.
    i. Ohio has established a definition of ``stationary source'' which 
includes internal combustion engines other than the newly defined 
category of ``nonroad engines''. This provision is consistent with the 
requirements in sections 302(z) and 111(a)(3) of the CAA and, 
therefore, approvable.
    j. Ohio has established provisions in response to section 173(a)(3) 
of the CAA to assure that owners or operators of each proposed new or 
modified major stationary source demonstrate, as a condition of permit 
issuance, the compliance of all other major stationary sources under 
the same ownership in the State. These provisions satisfy USEPA's 
requirements for approval.
    k. Ohio has established provisions in response to 40 CFR 
51.165(a)(3)(ii)(A) to ensure that emissions offset credit will be 
allowed only for control below an emission limitation under an 
applicable SIP that allows greater emissions than the potential to emit 
of a source. These provisions satisfy USEPA's requirements for 
approval.
    l. Ohio has established provisions in response to 40 CFR 
51.165(a)(3)(ii)(B) for existing fuel combustion sources which assure 
that emissions credit is based on the allowable emissions under the 
applicable SIP for the type of fuel being burned at the time the 
application to construct is being filed. The provisions require that 
should a source commit to switching to a cleaner fuel in the future, 
the permit must be conditioned to require the use of a specified 
alternative control measure which would achieve the same degree of 
emission reduction should the source switch back to a dirtier fuel. 
Adequate supplies of the new fuel must also be available. These 
provisions satisfy USEPA's requirements for approval.
    m. Ohio has established provisions in response to 40 CFR 
51.165(a)(3)(ii)(C) that detail the criteria which must be met in order 
for a source to receive credit for emissions reductions achieved by 
shutting down an existing source or curtailing production or operating 
hours below baseline levels. These provisions satisfy USEPA's 
requirements for approval.
    n. Ohio has established provisions in response to 40 CFR 
51.165(a)(3)(ii)(D) that assure that no emissions credit may be allowed 
for replacing one hydrocarbon compound with another with lesser 
reactivity. These provisions satisfy USEPA requirements for approval.
    o. Ohio has established provisions in response to 40 CFR 
51.165(a)(3)(ii)(F) for procedures relating to the permissible location 
of offsetting emissions. These provisions satisfy USEPA requirements 
for approval.
    p. Ohio has established provisions in response to 40 CFR 
51.165(a)(3)(ii)(G) to assure that credit for an emission

[[Page 17672]]

reduction can be claimed to the extent that the State has not relied on 
it in issuing a permit, preparing an attainment demonstration, or 
demonstration of further reasonable progress.
    q. Ohio has established provisions in response to 40 CFR 
51.165(a)(4) which allow that fugitive emissions may be excluded from 
the calculation of the potential of a stationary source or modification 
to emit if the source does not belong to any of the source categories 
listed in 40 CFR 51.165(a)(4). These provisions satisfy USEPA's 
requirements for approval.
    r. Ohio has established provisions in response to 40 CFR 
51.165(a)(5)(i) to assure that being granted an approval to construct 
shall not relieve any owner or operator of the responsibility to comply 
fully with applicable provisions of the SIP and under any other 
requirements under local, State or Federal law. These provisions 
satisfy USEPA's requirements for approval.
    s. Ohio has established provisions in response to 40 CFR 
51.165(a)(5)(ii) to assure that a source or modification that becomes a 
major stationary source or major modification by virtue of a relaxation 
in any enforceable limitation would be required to apply the applicable 
State rules to the source or modification as though construction had 
not yet commenced. These provisions satisfy USEPA's requirements for 
approval.
    t. Ohio has established provisions in response to 40 CFR 51.165(b) 
to assure that the Ohio nonattainment rules would apply to any new 
major stationary source or major modification locating in areas 
designated as attainment or unclassifiable when it would cause or 
contribute to a violation of any national ambient air quality standard. 
The new source or modification could alternatively choose to obtain 
sufficient emission reductions to compensate for its adverse impact on 
ambient air quality. These provisions satisfy USEPA's requirements for 
approval.
    u. Ohio has made some changes to the existing and previously 
approved Rule 3745-3103 (Permit to Install Exemptions). This rule 
addresses the cases in which exemptions from the requirement to obtain 
a permit to install would be considered by Ohio. These changes are in 
four sections: permanent exemptions, federal based exemptions, 
discretionary exemptions, and permit-by-rule exemptions. USEPA's 
analysis of these provisions is as follows.
    A. The introductory paragraph to the permanent exemption section 
states that the exemptions ``do not apply to a combination of common 
emissions units that are a major stationary source or major 
modification.'' USEPA interprets this language to mean that no sources 
or modifications that are major under the federal rules would be 
excused from the obligation to obtain a permit to install by this 
section of the rule.
    B. The federal based exemptions section excludes cleanup activities 
associated with the Comprehensive Environmental Response, Compensation, 
and Liability Act from the requirement to obtain a permit to install. 
USEPA considers this approvable.
    C. The discretionary exemptions section has been approved in a 
previous rulemaking (45 FR 72119).
    D. The permit-by-rule exemption section currently applies to one 
exemption, emergency electrical generators or emergency fire fighting 
water pumps. The equipment size constraints and recordkeeping 
conditions of this exemption are consistent with the September 6, 1995 
memo from John Seitz to Air Division Directors regarding calculating 
potential to emit for emergency generators, and is therefore 
approvable.
3. Ozone
    According to section 172(c)(5) of the CAA, SIPs must require 
permits for the construction and operation of new or modified major 
stationary sources. The statutory permit requirements in ozone 
nonattainment areas are generally contained in section 173, and in 
subpart 2 of part D of the CAA. These are the minimum requirements that 
States must include in an approvable implementation plan. For all 
classifications of ozone nonattainment areas and for ozone transport 
regions, States must adopt the appropriate major source thresholds and 
offset ratios, and must adopt provisions to ensure that any new or 
modified major stationary source of Oxides of Nitrogen (NOX) 
satisfies the requirements applicable to any major source of Volatile 
Organic Compounds (VOC), unless a special NOX exemption is granted 
by the Administrator under the provision of section 182(f) of the CAA. 
For serious and severe ozone nonattainment areas, State plans must 
implement sections 182(c)(6), (7) and (8) of the CAA with regard to 
modifications.
    For emissions of VOC and NOX in ozone nonattainment areas, 
Ohio has established the following major source thresholds in Rule 
3745-31-01 (Definitions) under the definition of ``Major Stationary 
Source'' and offset ratios in Rule 3745-31-26 (Offset Ratio 
Requirements) as follows:

------------------------------------------------------------------------
                                 Major source     Offset        NOX     
      Area classification          threshold      ratios     provisions 
----------------------------------------------------------------\2\-----
Marginal......................  100 tpy.......      1.1:1        1.1:1  
Moderate......................  100 tpy.......     1.15:1      1.15:1   
------------------------------------------------------------------------
\2\ It should be noted that Rule 3745-31-26(B) provides that NOx        
  emissions from stationary sources shall be treated as a nonattainment 
  air pollutant in each county that is designated nonattainment for     
  ozone. The offset requirements for ozone apply to NOX as well except  
  in areas that have been granted a waiver under section 182(f) of the  
  CAA. It should be noted that Ohio petitioned for and was granted a NOX
  control waiver pursuant to the provisions of section 182(f)(1)(B) of  
  the CAA because additional NOX reductions would not produce net ozone 
  air quality benefits. See 60 FR 36051 (July 13, 1995). Since the ozone
  nonattainment areas have been granted a NOx waiver under section      
  182(f), no NOX offsets will be required as long as this waiver remains
  in effect.                                                            

    Ohio does not have any serious, severe, or extreme ozone 
nonattainment areas. Butler, Warren, Hamilton, and Clermont are all 
designated as moderate ozone nonattainment areas.
    Rule 3745-31-01 (Definitions) details that a net emissions increase 
for VOC and NOX is significant under the definition of 
``significant'' when the increase is greater than 40 tons per year. In 
order to establish whether an increase in emissions is significant, the 
net emissions increase must be calculated by comparing the average of 
the most recent actual emissions of two consecutive years within the 
past five year period that is representative of actual emissions unit 
operation to the potential emissions of the modification. These 
provisions satisfy USEPA's requirements for approval.
4. Carbon Monoxide Nonattainment NSR Requirements
     The statutory permit requirements for carbon monoxide (CO) 
nonattainment areas are generally contained in section 173, and in 
subpart 3 of part D of the CAA. These are the minimum requirements that 
States must include in an approvable implementation plan. States must 
also adopt the appropriate major source threshold and offset ratio.
    Rule 3745-31-01 (Definitions) under the definition of 
``significant'' adopts a significance level of 100 tpy for CO. Rule 
3745-31-01 (Definitions), under the definition of ``Major Stationary 
Source'', adopts a major source threshold level of 100 tpy in a 
nonattainment area. The offset requirement of an amount equal to the 
amount of emissions increase for CO nonattainment areas would fall 
under Rule 3745-31-26. Ohio does not currently have any CO 
nonattainment areas. Even though these provisions

[[Page 17673]]

were not required they satisfy USEPA's approval requirements.
5. Particulate Matter Nonattainment NSR Requirements
    The statutory permit requirements for PM-10 nonattainment areas are 
generally contained in section 173, and in subpart 4 of part D of the 
CAA. These are the minimum requirements that States must include in an 
approvable implementation plan. For both the moderate and severe 
classifications of PM-10 nonattainment areas, States must adopt the 
appropriate major source threshold, offset ratio, significance level 
for modifications, and provisions for PM-10 precursors.
    Ohio has established major source thresholds, offset ratios, 
modification significance levels, and PM-10 precursor provisions as 
follows:
    A. In Rule 3745-31-01 (Definitions), under the definition of 
``Major Stationary Source'', a major source threshold level of 100 tpy 
in areas classified as nonattainment has been established.
    B. A general offset requirement of an amount equal to the amount of 
emissions increase is established in Rule 3745-31-26.
    C. Rule 3745-31-01 (Definitions) adopts a significance level of 15 
tpy for PM-10 under the definition of ``significant''.
    D. In accordance with the requirements of section 189 of the CAA, 
Rule 3745-31-21 states that major stationary sources of PM-10 
precursors shall be subject to the applicable control requirements 
except where the Director determines that such sources do not 
contribute significantly to the PM-10 levels that exceed the standard 
in the area. It should be noted that on May 27, 1994 (59 FR 27464), 
USEPA made a finding that PM-10 precursors do not contribute 
significantly to PM-10 levels that exceed the standard.
     PM precursors are pollutants emitted as gases that undergo 
chemical transformations to become particulate, and principally include 
sulfates and nitrates. Cuyahoga and a portion of Jefferson County are 
designated as a moderate nonattainment area for particulate matter. No 
area has been designated as a severe nonattainment area for particulate 
matter. These provisions are consistent with USEPA approval 
requirements.
6. Sulfur Dioxide Nonattainment NSR Requirements
    The statutory permit requirements for sulfur dioxide (SO2) 
nonattainment areas are generally contained in section 173, and in 
subpart 5 of part D of the CAA. These are the minimum requirements that 
States must include in an approvable implementation plan. For SO2 
nonattainment areas, States must adopt the appropriate major source 
threshold, offset ratio, and significance level for modifications.
    The State of Ohio has established a major source threshold level of 
100 tpy in Rule 3745-31-01 (Definitions), under the definition of Major 
Stationary Source. A general offset requirement of an amount equal to 
the amount of emissions increase is established in Rule 3745-31-26. 
Rule 3745-31-01 (Definitions) under the definition of ``significant'' 
adopts a significance level of 40 tpy for SO2. Currently, portions 
of Coshocton, Cuyahoga, Gallia, Jefferson, Lake, Lorain, and Lucas 
Counties are designated as nonattainment for SO2. Summit County 
has no designation pending USEPA action on a remand. These provisions 
are sufficient for USEPA approval.
7. Lead Nonattainment NSR Requirements
    The statutory permit requirements for lead nonattainment areas are 
generally contained in section 173 and in subpart 5 of part D of the 
CAA. These are the minimum requirements that States must include in an 
approvable implementation plan. For lead nonattainment areas, States 
must adopt the appropriate major source threshold, offset ratio, and 
significance level for modifications.
    Ohio established a major source threshold level for stationary 
sources which emit or have the potential to emit 100 tpy of any 
pollutant for which the area is designated as nonattainment in Rule 
3745-31-01 under the definition of ``Major Stationary Source''. The 
offset requirement of an amount equal to the amount of emission 
increases would fall under the general definition of Rule 3745-31-26 
and is acceptable to USEPA. Under the definition of Significant, Rule 
3745-31-01 includes a significance level of 0.6 tpy for lead. There are 
no areas of Ohio currently designated as not attaining the lead 
standard.
8. Nitrogen Dioxide Nonattainment NSR Requirements
    The statutory permit requirements for nitrogen dioxide (NO2) 
nonattainment areas are generally contained in section 173, and in 
subpart 5 of part D of the CAA. These are the minimum requirements that 
States must include in an approvable implementation plan. For 
nonattainment areas, States must adopt the appropriate major source 
threshold, offset ratio and significance level for modifications. 
Although Ohio has no NO2 nonattainment areas it has complied with 
these requirements.
    The State of Ohio has established a major source threshold level of 
100 tpy in Rule 3745-31-01 (Definitions), under the definition of 
``Major Stationary Source'' for nonattainment areas. Rule 3745-31-01 
(Definitions), under the definition of ``significant'', adopts a 
significance level of 40 tpy for nitrogen oxide (NOX). The 
NOX offset requirement established in Rule 3745-31-26 states that 
the offset requirements for ozone shall also apply to NOX unless a 
NOX waiver is granted under section 182(f) of the CAA. NO2 is 
considered a NOX so these provisions are also applicable to 
NO2. As discussed in footnote 2, a NOX waiver has been 
granted for all Ohio ozone nonattainment areas and the waiver 
effectively suspends enforcement of these requirements as long as the 
waiver remains in effect. These provisions satisfy USEPA's approval 
requirements.
9. Miscellaneous Definition Changes
    Any definitional changes under Rule 3745-31-01 as compared to the 
definitions under 40 CFR 51.165 not specifically mentioned in this 
proposed rule are not significant.
    The definition of ``Building, Structure, Facility, or 
Installation'' and ``Stationary Source'' in 40 CFR 51.165 have been 
combined under the definition of ``Stationary Source'' under Rule 3745-
31-01. This combination of definitions satisfies USEPA's requirements 
for approval.
    The definition of ``Major Modification'' under Rule 3745-31-01 does 
not provide for the exemptions allowed under 51.165 (a)(1)(v)(C) (8) 
and (9) pertaining to pollution control projects and clean coal 
technology demonstration projects. USEPA considers the absence of these 
exemptions to be more stringent than the Federal definition and is, 
therefore, approvable.
    Ohio has chosen to omit the definition of ``electric utility steam 
generating unit'' and the related definition of ``Representative Actual 
Annual Emissions'' from 40 CFR 51.165 (a)(1) (xx) and (xxi) since those 
terms are not used within the Ohio NSR rules. Electric utility steam 
generating units under the Federal definition would be required by Ohio 
rules to follow the same permitting process and applicable baseline 
calculations as other source categories. In other words, Ohio has not 
given electric utility steam generating units the additional 
flexibility that the Federal rules would otherwise allow. On this point 
the State rule is more

[[Page 17674]]

stringent than the Federal requirement and, therefore, approvable.
    Under the definition of ``Actual Emissions'' in Rule 3745-31-01, 
Ohio has not provided for a separate interpretation of actual emissions 
for electric steam generating units provided for in 40 CFR 
51.165(a)(1)(xii)(E). This omission is acceptable to USEPA and 
approvable.
    The definitions of ``Temporary Clean Coal Technology Demonstration 
Project'' and ``Clean Coal Technology Demonstration Project'' are 
contained in Rule 3745-31-21 as opposed to Ohio's Rule which holds the 
definitions (3745-31-01). The placement of these definitions is 
acceptable to USEPA and approvable.
    The definition of ``Pollution Control Project'' from 40 CFR 51.165 
(a)(1)(xxv) has been omitted from the Ohio rules although the term is 
utilized in the definitions of ``modify'' and ``modification''. 
Inclusion of the Federal definition of this term is a mandatory 
requirement for Federal approval of the Ohio NSR requested SIP revision 
unless the State demonstrates that the definition used in the State 
rule is more or equally stringent as the Federal definition. Because 
Ohio has not used this term in its NSR rule, it has not satisfied this 
requirement. In an April 12, 1996 transmittal letter of Ohio's finally 
adopted NSR rules to USEPA, Ohio has committed to modify its NSR rules 
to incorporate the definition of ``Pollution Control Project'' not 
later than September 21, 1997. Based on this commitment, USEPA proposes 
approval of the Ohio NSR rules.
    Each time Ohio used the term regulated pollutant in their rules, 
such as the definitions of ``Major Stationary Source'' and 
``Significant,'' the term is qualified with the statement ``including 
lead compounds but excluding other air pollutants regulated due to 
being listed under section 112 of the CAA''.
    This statement is consistent with section 112(b)(6) of the CAA and 
is, therefore, approvable.

III. Proposed Rulemaking Action

    As stated above, the Ohio NSR submittal contains one deficiency 
which is sufficient to serve as a basis for USEPA disapproval of the 
State's requested SIP revision. Furthermore, two interpretations listed 
in e. and u. of II(A)(1) could be a disapproval item in the absence of 
State concurrence with USEPA's interpretation. Because, however, the 
State has committed to remedy the deficiency identified not later than 
September 21, 1997 and agreed that USEPA's interpretations of the State 
rules are consistent with the State's own interpretations, USEPA 
proposes to conditionally approve the requested SIP revision. 
Conditional approval would allow the State one year from final 
rulemaking to remedy the deficiencies identified above. If the State 
remedies the deficiencies prior to the one year deadline, USEPA will 
rulemake to convert the conditional approval to an approval. If the 
State does not remedy the deficiencies within the allowed one year 
period, the conditional approval will become a disapproval.
    The rules proposed for conditional approval in this rulemaking 
action are OAC 3745-31-01(A)(B)(C)(D)(E)(F) 
(G)(H)(I)(J)(K)(L)(M)(N)(O)(Q)(R)(S)(V)(W)(X)(Y)(Z)(AA)(BB)(CC) 
(DD)(EE)(FF)(GG)(HH)(II)(JJ)(KK)(LL)(MM)(NN)(OO)(PP)(SS)(TT)(WW) 
(XX)(YY)(ZZ)(BBB)(DDD), 3745-31-02(A)(2)(C)(D), 3745-31-03 
(A)(1)(2)(a)(3)(4), 3745-31-05(A)(2)(d)(f)(D)(F), 3745-31-09, 3745-31-
10, 3745-31-21, 3745-31-22, 3745-31-23, 3745-31-24, 3745-31-25, 3745-
31-26, 3745-31-27.

IV. Impact on Sanctions

    In a final rule published on September 21, 1994 (59 FR 48392), 
USEPA disapproved Ohio's August 20, 1993 submittal of a requested SIP 
revision for NSR. That final rule initiated USEPA's sanction process as 
discussed in USEPA's August 4, 1994 (59 FR 39832) Final Rule and Notice 
on CAA Sanctions. This August 4, 1994 final rule finalized USEPA's 
selection of sequence of mandatory sanctions for findings made pursuant 
to section 179 of the CAA. See 59 FR 39832. This rulemaking states that 
the section 179(b)(2) of the CAA offset sanction applies in an area 18 
months from the date when the USEPA makes a finding under section 
179(a) of the CAA with regard to that area. Furthermore, the section 
179(b)(1) of the CAA highway funding restrictions apply in an area 6 
months following application of the offset sanction. Because the 
effective date of USEPA's disapproval of Ohio's earlier NSR SIP 
revision request is October 21, 1994, the requirement for-two-for one 
offsets of sources receiving permits for major new sources or 
modifications located in Ohio nonattainment areas is scheduled to begin 
April 21, 1996. Similarly the start date for imposing highway funding 
sanctions is October 21, 1996. Any sanction USEPA imposes must remain 
in place until USEPA determines that the State has come into 
compliance.
    Because USEPA is proposing to conditionally approve Ohio's 
requested NSR SIP submittal, in the rules section of this Federal 
Register the USEPA is issuing an interim final determination that the 
Ohio has corrected the deficiency created when the USEPA disapproved 
the Ohio requested SIP revision for NSR. This interim determination is 
intended to defer the application of the two-for-one offset and highway 
funding sanctions until USEPA makes a final determination on the Ohio's 
NSR submittal.

V. Request for Public Comments

    The USEPA is requesting comments on all aspects of the requested 
SIP revision and USEPA's proposed rulemaking action. Comments received 
by the date indicated above will be considered in the development of 
USEPA's final rulemaking action.

VI. Executive Order 12866

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

VII. Regulatory Flexibility

    Under the Regulatory Flexibility Act, 5 U.S.C. 600 et seq., USEPA 
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, USEPA may certify that the rule will not have a 
significant 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.
    USEPA's disapproval of the State request under section 110 and 
subchapter I, part D of the CAA does not affect any existing 
requirements applicable to small entities. Any pre-existing Federal 
requirements remain in place after this disapproval. Federal 
disapproval of the State submittal does not affect its state-
enforceability. Moreover, USEPA's disapproval of the submittal does not 
impose any new Federal requirements. Therefore, USEPA certifies that 
this disapproval action does not have a significant impact on a 
substantial number of small entities because it does not remove 
existing requirements nor does it impose any new Federal requirements.
    SIP approvals under section 110 and subchapter I, part D of the CAA 
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

[[Page 17675]]

Federal-State relationship under the CAA, preparation of a regulatory 
flexibility analysis would constitute Federal inquiry into the economic 
reasonableness of State action. The CAA forbids USEPA to base its 
actions concerning SIP's 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).

VIII. Unfunded Mandates

    Under sections 202, 203 and 205 of the Unfunded Mandates Reform Act 
of 1995 (Unfunded Mandates Act), signed into law on March 22, 1995, 
USEPA 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 a State, 
local and/or tribal government(s) in the aggregate. The USEPA must also 
develop a plan with regard to small governments that would be 
significantly or uniquely affected by the rule.
    Because this proposed rule if finally adopted is estimated to 
result in the expenditure by State, local and tribal governments or the 
private sector of less than $100 million in any one year, USEPA has not 
prepared a budgetary impact statement or specifically addressed the 
selection of the least costly, most cost effective, or least burdensome 
alternative and because small governments will not be significantly or 
uniquely affected by this rule, USEPA is not required to develop a plan 
for small governments. Further, this proposed rule if finally adopted 
only approves existing State regulations; it imposes no new 
requirements.

List of Subjects in 40 CFR Part 52

    Environmental protection, Air pollution control, Hydrocarbons, 
Intergovernmental relations, New source review, Nitrogen dioxide, 
Particulate matter, Lead, Carbon monoxide, Reporting and recordkeeping 
requirements, Sulfur dioxide, Volatile organic compounds.

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

    Dated: April 15, 1996.
David A. Ullrich,
Acting Regional Administrator.
[FR Doc. 96-9914 Filed 4-19-96; 8:45 am]
BILLING CODE 6560-50-P