[Federal Register Volume 61, Number 220 (Wednesday, November 13, 1996)]
[Rules and Regulations]
[Pages 58284-58294]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-28432]



[[Page 58283]]

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Part II





Environmental Protection Agency





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40 CFR Part 69



Final Conditional Special Exemption From Clean Air Act Requirements for 
the Territory of American Samoa, the Commonwealth of the Northern 
Mariana Islands, and the Territory of Guam; Final Rule

  Federal Register / Vol. 61, No. 220 / Wednesday, November 13, 1996 / 
Rules and Regulations  

[[Page 58284]]



ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 69

[AD-FRL-5645-1]


Final Conditional Special Exemption From Requirements of the 
Clean Air Act for the Territory of American Samoa, the Commonwealth of 
the Northern Mariana Islands, and the Territory of Guam

AGENCY: Environmental Protection Agency (EPA).

ACTION: Direct final rule.

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SUMMARY: The EPA is promulgating a direct final rule conditionally 
exempting the Territory of American Samoa (American Samoa), the 
Commonwealth of the Northern Mariana Islands (CNMI), and the Territory 
of Guam (Guam), as well as certain owners and operators of sources in 
American Samoa, CNMI and Guam from the requirements of title V of the 
Clean Air Act (Act). EPA is revising its September 13, 1995 proposed 
rule with respect to Guam. In the proposed action, EPA granted American 
Samoa and CNMI, as well as owners and operators of certain sources 
within those territories, a conditional exemption from title V 
requirements. In the proposal, EPA also granted Guam an extension of 
time in which to adopt a title V permit program and owners or operators 
of certain sources an extension of time in which to obtain title V 
permits. EPA has revised the proposal and today is promulgating a 
direct final rule that maintains the conditional exemptions granted to 
American Samoa and CNMI and also conditionally exempts Guam from title 
V of the Clean Air Act. EPA is granting these conditional exemptions 
under the authority of section 325 of the Act.

DATES: The direct final rule for American Samoa, CNMI, and Guam is 
effective on January 13, 1997 unless adverse or critical comments are 
received by December 13, 1996. If the effective date is delayed, EPA 
will publish a timely notice in the Federal Register.

ADDRESSES: Copies of the petitions, the response to comments document, 
and other supporting information used in developing the final special 
exemption are available for inspection during normal business hours at 
the following location: Office of Pacific Islands and Native American 
Programs, US EPA-Region IX, 75 Hawthorne Street, San Francisco, 
California 94105.

FOR FURTHER INFORMATION CONTACT: Norm Lovelace (telephone 415/744-1599, 
fax 415/744-1604), Chief, Office of Pacific Islands and Native American 
Programs, or Sara Bartholomew (telephone 415/744-1250, fax 415/744-
1076), Operating Permits Section, Air and Toxics Division, at the EPA-
Region IX address listed above.

I. Background

    Section 325(a) of the Act authorizes the Administrator of EPA, upon 
petition by the Governor, to exempt any person or source or class of 
persons in Guam, American Samoa, and CNMI from any requirement of the 
Act except for requirements of Section 110 and Part D of subchapter I 
of the Act (where necessary to attain and maintain the National Ambient 
Air Quality Standards (NAAQS), and Section 112. Such exemption may be 
granted if the Administrator finds that compliance with such 
requirement is not feasible or is unreasonable due to unique 
geographical, meteorological, or economic factors of such territory, or 
such other local factors as the Administrator deems significant.
    The Governors of American Samoa, CNMI, and Guam each submitted a 
petition pursuant to section 325(a) of the Act for an exemption from 
title V of the Act. Title V requires states, including American Samoa, 
CNMI, and Guam, to adopt and submit to EPA a title V operating permit 
program for major sources and certain other stationary sources. If any 
state does not adopt an operating permit program, title V requires EPA 
to apply certain sanctions within that area and to promulgate, 
administer, and enforce a federal operating permit program for such 
area. EPA proposed regulations to implement a federal operating permit 
program on April 27, 1995 (60 FR 20804) and promulgated the final rule 
on July 1, 1996, at 40 CFR part 71 (61 FR 34202) (part 71). Title V 
also requires that sources located in states that do not adopt a title 
V permitting program obtain a federal operating permit from the EPA.
    On September 13, 1995, EPA issued a proposed rule (60 FR 47515) 
(the proposal) in response to petitions from the Governors of American 
Samoa, Guam and CNMI. In the proposal, EPA granted the government of 
Guam a three-year extension of the deadlines for submitting a title V 
program and also proposed granting certain sources on Guam a similar 
three-year extension of time in which to obtain title V permits. After 
the proposal, Guam submitted comments requesting an exemption and 
committed to achieving several of the goals of title V by developing an 
alternate operating permit program. EPA is now granting the government 
of Guam an exemption from the requirement to adopt a title V program on 
the condition that Guam adopt and implement a local alternate operating 
permit program.
    In the proposal, EPA also proposed granting American Samoa and CNMI 
exemptions from the requirement to implement a title V permit program 
and proposed granting owners or operators of certain sources subject to 
title V a similar exemption from the requirement to apply for a title V 
permit. Today's direct final rule exempts both American Samoa and CNMI 
from the requirement to adopt a title V program on the condition that 
American Samoa and CNMI adopt and implement programs to permit 
stationary sources and programs to protect the NAAQS. The programs to 
protect the NAAQS are described in the proposal and the petitions.
    EPA is also granting owners or operators of certain sources on 
American Samoa, CNMI, and Guam a conditional exemption from the 
requirement to apply for a federal title V operating permit under part 
71. This rulemaking does not waive part 71 permitting requirements for 
owners or operators of solid waste incinerators required to obtain a 
title V operating permit under section 129(e) of the Act or of major 
sources under Section 112 of the Act required to obtain title V 
permits. This rulemaking also does not waive or exempt the governments 
of Guam, American Samoa, or CNMI, or owners or operators of sources 
located in these territories, from complying with all other applicable 
Clean Air Act provisions.
    EPA is promulgating this action as a direct final rule because the 
Agency views this as a noncontroversial action and anticipates no 
adverse comments. In fact, the public comments received to date support 
granting an exemption from title V requirements. In the Proposed Rules 
Section of this Federal Register, however, EPA has also published a 
proposal that allows the public 30 days to comment on the direct final 
rule for American Samoa, CNMI, and Guam. If adverse comments are 
received during the comment period, EPA will publish a subsequent 
document in the Federal Register before the effective date of the 
exemption and will withdraw the direct final rule for any territory for 
which adverse comments are received. All public comments received will 
then be addressed by the Agency in a subsequent final rule based on 
this action serving as a proposed rule. The

[[Page 58285]]

EPA will not institute a second comment period on this action. Any 
parties interested in commenting on this action should do so at this 
time. If no such comments are received, the public is advised that this 
action will be effective on January 13, 1997.

II. Final Action and Implications

A. Conditional Approval of Guam's Exemption Request

1. Guam's Commitment Letter
    The Administrator of the Guam Environmental Protection Agency 
(GEPA) sent a letter to EPA on December 18, 1995. The GEPA 
Administrator committed to develop and implement an alternate air 
operating permit program that addresses many of the elements of a title 
V program in exchange for an exemption from title V. GEPA's commitment 
letter states that Guam would develop an alternate operating permit 
program that would: (1) permit all major sources; (2) incorporate all 
applicable federal requirements in permit conditions; (3) incorporate 
monitoring, recordkeeping and reporting requirements in permit 
conditions; (4) allow for public review and comment; (5) enhance 
enforcement authorities, including civil and criminal penalties; (6) 
identify the resources necessary to maintain an alternate program; (7) 
permit existing major sources within three years; (8) conduct regular 
inspections of permitted sources; and (9) coordinate the local program 
with EPA air programs.
    EPA continues to believe that implementation of title V would 
enhance air quality by ensuring that a comprehensive and effective 
permitting program is implemented. However, in light of GEPA's new 
commitment to develop an alternate operating permit program that 
encourages compliance and allows public participation, EPA is allowing 
Guam the opportunity to demonstrate that the proposed alternative 
operating permit program can meet title V's goals. EPA is promulgating 
an exemption for Guam from the requirement to develop a title V 
permitting program on the condition that Guam adopt and implement the 
alternate operating permit program.
2. Additional Comments
    EPA received similar comments from four other commenters supporting 
the Governor's petition for an exemption for Guam. Two commenters 
objected to EPA's proposed requirement that Guam implement title V 
within three years and requested that EPA grant an exemption from the 
requirement to develop a title V permit program instead. They commented 
that the costs of the title V program would be an economic burden and 
would require that GEPA develop additional technical resources. They 
also stated that thirty local businesses would be required to pay 
$10,000 per year for the program.
    EPA believes that the alternate program addresses concerns over the 
program's costs by allowing Guam flexibility to develop a less 
expensive program based on local priorities. The alternate air 
operating permit program requires that Guam improve its air program and 
obtain additional technical resources, but allows Guam flexibility to 
reduce costs and address local needs. In addition, most of the local 
businesses cited in the comments, including several with no emissions, 
would not have been required to obtain a title V permit because they 
are not major sources.
    Two of the commenters also stated that air quality is pristine 
because Guam is an isolated island and that title V will not improve 
air quality. Guam has a significant number of major sources of criteria 
pollutants and hazardous air pollutants. While Guam is unlikely to 
suffer from or contribute to regional air pollution problems due to its 
isolation, these major sources can contribute to localized air 
pollution problems. EPA believes that a comprehensive permitting 
program, such as title V, will help ensure that local air quality is 
not degraded by improving compliance with applicable Clean Air Act 
requirements. However, EPA is granting Guam flexibility to demonstrate 
that a local alternate operating permit program would adequately 
protect air quality under Guam's unique local circumstances.
    Two of the commenters also stated that the title V permit program 
is excessively intrusive to Guam's government because it requires that 
Guam Power Authority, which is operated by Guam's government, obtain 
title V permits and pay title V fees. EPA notes, however, that the 
Clean Air Act requires that sources controlled by governments meet the 
same air quality standards as other sources. Therefore, sources 
controlled by Guam's government or the U.S. government must obtain an 
operating permit under the alternate operating permit program.
    Please see the response to comments document in the docket for more 
details on the comments that were submitted and EPA's responses.

B. Final Conditions for the Alternate Operating Permit Programs for 
American Samoa, CNMI, and Guam

    The final requirements for each alternate operating permit program 
address deficiencies in existing programs and generally reflect 
commitments made by the petitioners. The conditions for Guam's 
operating permit program are similar to the conditions set forth in the 
proposal for the alternate operating permit programs for American Samoa 
and CNMI. American Samoa and CNMI will also implement programs to 
monitor compliance with the NAAQS and reduce emissions as necessary. 
Guam is not required to implement new programs to protect ambient air 
quality standards if granted a title V exemption, because a previous 
waiver for Guam (see 40 CFR 69.11) imposed similar requirements. The 
final conditions also include express terms clarifying that the 
alternate program must require compliance certifications, include a 
system of regular inspections, and provide that fees collected under 
the program are not used for other purposes. The provisions clarify 
that the permits must be renewed periodically. In addition, the final 
rule explicitly sets forth EPA's opportunity to review permits, which 
was previously included in the proposed conditions by reference to 
EPA's general June 28, 1989 permit program guidelines. In order to 
address EPA's concern that all owner or operators of sources subject to 
title V permitting requirements eventually obtain an operating permit, 
the exemptions for each territory provide instances in which the 
exemption will expire by a certain date. First, the exemption will 
expire two (2) years after the effective date of this rule if a 
territory has not submitted an alternate operating permit program to 
EPA by that time. Second, the exemption for owners or operators of 
sources subject to title V requirements will expire six (6) years after 
the effective date of this rule for any source subject to title V 
permitting requirements that has not obtained a permit under an EPA 
approved alternate permit program. If the exemption expires, the 
requirements of part 71 apply. The exemptions for each territory also 
include conditions when EPA will revoke the exemption in its entirety 
or on a source specific basis. The exemptions for American Samoa and 
CNMI have been revised to include these clarifications and additions. 
Without these ``checks'' to ensure that sources will eventually be 
permitted through an adequate air operating permit program, EPA does 
not believe

[[Page 58286]]

that it could allow the exemption from the title V requirements that it 
is granting today.
1. Inspections
    Guam's conditional exemption requires that Guam implement a system 
of regular inspections of permitted sources and a system to identify 
any unpermitted major sources. 40 CFR Part 70 requires that states 
adequately inspect and monitor sources (70.10(c)(iii)), and EPA 
believes that the inspections required under title V are also essential 
for the success of the alternate operating permit programs. Guam does 
not currently have a program for routinely inspecting air pollution 
sources, but GEPA committed to implement a system of regular 
inspections as part of the alternate operating permit program in its 
December 18, 1995 letter. EPA understands this commitment to mean that 
Guam will provide adequate inspector staff and training and develop 
appropriate internal procedures to inspect all permitted sources. EPA 
also expects that Guam will develop appropriate guidelines for 
responding to violations that are discovered. EPA will assist Guam by 
providing guidance and manuals for inspecting permitted sources.
    EPA is modifying the conditions set forth in the proposal for 
American Samoa and CNMI to explicitly require that these territories 
also implement a system of regular inspections. EPA believes that 
inspections will be equally important for these air quality programs, 
and the proposal for American Samoa and CNMI implicitly required 
inspections and appropriate responses to violations to ensure 
compliance with all applicable requirements. After considering Guam's 
comments and the need for inspections on Guam, EPA has decided to 
include this requirement as an explicit provision of each waiver.
2. Compliance Certifications
    EPA is requiring that Guam's alternate operating permit program 
require sources to submit compliance certifications and compliance 
plans to address noncompliance. The program shall also require that 
sources submit, as part of the compliance plan, a schedule to 
expeditiously remedy any noncompliance or achieve compliance with 
promulgated regulations that have a future compliance date. The 
Governor of Guam and R.W. Beck stated that the compliance benefits of 
title V will be achieved without implementing the compliance 
requirements of title V. They cited an environmental audit conducted by 
the Guam Power Authority (GPA) after an EPA enforcement action and 
claimed that ``[t]here is no environmental benefit to be gained from a 
repeat of the same exercise.''
    EPA believes that a one-time confidential audit cannot achieve the 
same compliance benefits as a comprehensive and ongoing permitting 
program like title V. Title V improves air quality by requiring that 
sources identify their emissions, all applicable requirements, and 
their compliance status with each such requirement. Furthermore, permit 
holders agree to remedy any noncompliance through a compliance 
schedule, continue to meet applicable Clean Air Act obligations in the 
future, and inform the public of their compliance status. (40 CFR 
70.5(c)(8) and (9), 70.5(d), and 70.6(c)). State implementation of 
title V programs has already created numerous examples of the program's 
value in identifying ongoing compliance problems and prompting action 
to resolve these problems. EPA is clarifying that the alternate local 
programs must require that sources submit initial compliance 
certifications and plans with permit applications and regular 
compliance certifications at least annually thereafter to provide air 
quality benefits and protect the public's right to know of any Clean 
Air Act violations.
    EPA is modifying the conditions set forth in the proposal for 
American Samoa and CNMI to explicitly require compliance 
certifications, plans, and schedules for the same reasons. The proposal 
required that permits be enforceable and that they provide for 
monitoring, recordkeeping, and reporting that would assure compliance 
with applicable requirements. EPA believes that the conditions set 
forth in the proposal would require that sources report and correct 
violations to assure compliance with applicable requirements. However, 
Guam's comment shows that explicit guidance is necessary to clarify 
this requirement and ensure that compliance certifications, plans, and 
schedules are submitted and that violations are corrected. EPA will 
provide examples of approved compliance certifications so that the 
petitioners may use them as models for the alternate operating permit 
programs.
3. Resources
    EPA is requiring that the petitioners develop appropriate 
mechanisms to provide adequate funding for the local alternate air 
permit programs. Most states have created a special fund to ensure that 
title V operating permit programs are adequately funded and that permit 
program funding is used solely for the permit program. While the 
alternate programs will impose lower costs than title V programs, 
adequate funding will still be necessary to develop and implement the 
alternate programs. The alternate operating permit programs and the 
NAAQS programs for American Samoa and CNMI must also ensure that 
sufficient ongoing funding will be provided and not diverted from the 
program. These safeguards are necessary to ensure that funds committed 
to the permit program and used as the basis for EPA approval will be 
used to support the air program.
4. EPA Review and Objection
    EPA is replacing the review requirements that were included in the 
proposal by reference to June 28, 1989 guidance (see 54 FR 27282) with 
explicit provisions that allow EPA the opportunity to comment on and 
object to permits that do not conform to the alternate operating permit 
program requirements. EPA will object to draft permits that are not 
consistent with the approved alternate operating permit program and the 
40 CFR part 69 exemption conditions, including permits that do not 
contain the correct applicable requirements and emission limits or are 
not issued through the correct procedures. If EPA objects to a permit, 
the permit must be revised to address EPA's concerns prior to issuance 
or it will not be considered a valid federally enforceable permit that 
complies with the conditions of the exemption and an alternate 
operating permit program approved by EPA. In such a situation, the 
source must obtain a permit that resolves EPA's objections or the 
source and the permitting authority (Guam, CNMI or American Samoa) will 
no longer meet the conditions of the exemption with respect to that 
permit. If EPA objects to a permit, EPA will notify the permitting 
authority of its objections and send a copy to the permit applicant. 
The permitting authority will have 180 days to work with EPA to issue a 
revised permit that resolves EPA's objections. If the territory does 
not issue a permit that resolves EPA's objections within 180 days, the 
exemption will be revoked for that source and the source will be 
subject to the federal operating permit requirements of part 71.
    EPA believes that this oversight role will lead to the issuance of 
permits that both EPA and the permitting authority agree comply with 
the exemption, the approved alternate operating permit program and all 
applicable requirements. The petitioners all stated

[[Page 58287]]

that they currently lack the technical resources to issue comprehensive 
operating permits, and EPA oversight will help them implement the 
alternate operating permit program. In addition, federal review will 
help prevent any perception of bias when government power plants are 
permitted by essentially the same organization that operates them. 
Therefore, EPA oversight will assist the implementation of the 
alternate permitting programs. Finally, EPA believes that oversight 
during the permit process will reduce subsequent disputes between EPA, 
sources, and each territory over permit terms and conditions. 
Therefore, EPA is including a condition in the exemption that EPA will 
have a review period in which to object to permits that EPA believes do 
not comply with the alternate program.
5. Renewals and Reopening for Cause
    EPA is requiring each territory to include a provision in the 
alternate operating permit program for permit renewal within five years 
of issuance. Regular renewals will be necessary to incorporate any new 
or revised requirements, add or remove compliance schedules, and keep 
permits current. The petitioners may choose to issue permits for any 
fixed duration that does not exceed five years.
    EPA is also requiring that each alternate program allows each 
petitioner to reopen permits for cause. For instance, an application 
may contain incorrect information or a permit may contain an incorrect 
applicability determination or other material mistake. In addition, a 
new or revised applicable requirement may be substantially inconsistent 
with a permit that would not otherwise be updated for up to five years. 
Petitioners should reopen permits to incorporate new requirements in 
such situations if, in their estimation, there is a substantial amount 
of time remaining in the permit term. Therefore, EPA is requiring that 
each territory and EPA have authority to reopen permits that are not 
consistent with the Act. The program must provide for notice to the 
permittee and the public when a permit is reopened in this manner. 
Consistent with the requirements for EPA objection discussed above, if 
EPA determines that cause exists for reopening a permit issued to a 
source (i.e. the permit is inconsistent with the applicable 
requirements and the terms of this exemption), and the permitting 
agency does not issue a new permit that corrects the deficiency within 
180 days of receiving EPA's notice, EPA will revoke the exemption and 
issue a permit under part 71. EPA is basing the 180 day deadline on the 
longest period allowed under section 40 CFR 70.7, which it finds is a 
reasonable deadline for issuing corrected permits under the alternate 
operating permit programs.
6. Revocation, Expiration or Modification of Exemption
    This rulemaking establishes the conditions for which the exemption 
for Guam, American Samoa, or CNMI will expire or will be revoked or 
modified, and explains the appropriate administrative mechanism. First, 
the exemption for any territory will expire two years after the 
effective date of this rule without further rulemaking unless the 
territory submits an alternate operating permit program by the date 
specified in the rule. The program should substantively address each 
requirement of the exemption. If a program is not submitted by the 
deadlines set forth in this rule, part 71 will become effective for the 
territory on that date. As set forth in Section E, below, American 
Samoa and CNMI are required by this rule to conduct modeling and to 
submit any State Implementation Plan (SIP) revision necessary to 
address compliance with the NAAQS. For American Samoa, the exemption 
will also expire if American Samoa fails to submit air quality modeling 
and supporting data within two years of the effective date of this 
rule. For CNMI the exemption will expire if CNMI fails to submit a SIP 
to assure compliance with the NAAQS for SO2, unless CNMI 
demonstrates within one year through additional modeling and site 
specific meteorological data that the NAAQS for SO2 is protected.
    If an alternate program is submitted by the deadline, the exemption 
will continue while EPA reviews the program to determine if it 
qualifies for approval. EPA will approve the program and provide notice 
of the approval in the Federal Register if the program meets the 
conditions of the exemption and will disapprove the program and revoke 
the exemption by rulemaking if it does not. In addition, EPA may revoke 
or modify the conditional exemption through rulemaking if the 
permitting authority does not adequately implement and enforce the 
alternate program.
    EPA is including additional procedures for expiration or revocation 
of the exemption in this rulemaking to assure that all sources will 
eventually obtain a valid federally enforceable operating permit under 
either an approved alternate operating permit program or part 71. 
First, if the local agency fails to issue an operating permit under an 
approved alternate program to a source within six years of the 
effective date of this rulemaking, the exemption will expire for any 
source without a permit and that source will become subject to the part 
71 federal operating permit requirements. The six year date is based on 
similar deadlines set forth in Title V of the Clean Air Act for 
submittal and approval of the operating permit program and issuance of 
permits to all sources. These expiration and revocation provisions will 
not apply to any source that has obtained an operating permit through 
an alternate operating permit program approved by EPA within the six 
year deadline. This requirement provides a backstop for assuring that 
all subject sources will have a means for applying for an operating 
permit no later than six years from today.
    These new termination/revocation provisions are necessary to fill 
gaps that existed in the proposal. With these procedures EPA will 
ensure that all owners or operators of subject sources that would have 
been required to obtain a Title V permit will eventually be permitted 
under an approved program. These provisions will also ensure that all 
owners and operators of subject sources will apply for an operating 
permit by a date certain so that no source goes unpermitted.
    EPA may determine in the future that the implementation of a title 
V permitting program or the modification of the exemption is necessary 
to ensure compliance with applicable Clean Air Act requirements and to 
protect air quality. If EPA determines that revocation or modification 
of the exemption is necessary due to changed circumstances or other 
causes, EPA will conduct a rulemaking to revoke or modify the 
exemption. In this case the exemption and its conditions will remain 
effective until EPA has completed its rulemaking.
7. Federal Enforceability
    In order for EPA to authorize an exemption for each territory as 
set forth in this rule, EPA must ensure that permits issued under the 
alternate programs required by this rule are federally enforceable. 
This is consistent with the title V permit program and is an important 
component to assure that each territory attains and/or maintains 
compliance with the NAAQS. Therefore, EPA is requiring, as a condition 
of the exemptions authorized in this rule, that each territory submit a 
revision to its SIP to make permits issued under an approved alternate 
program federally enforceable. The SIP revision should provide that a 
person shall not violate any permit condition or term in a permit that 
has been issued

[[Page 58288]]

under an alternate operating permit program approved by EPA.

C. Implementation of Title V for Hazardous Air Pollutant Sources and 
Solid Waste Incineration Units

    This action does not waive any title V permitting requirement that 
applies to major sources of hazardous air pollutants (HAPs) in American 
Samoa, CNMI, or Guam and is conditioned to address special concerns 
presented by the local impact of HAPs. Any source that would be subject 
to title V because it is a major source under Section 112 of the Clean 
Air Act or a solid waste incinerator regulated under section 129 of the 
Clean Air Act must obtain a title V permit under part 71.
    Any nonmajor source of hazardous air pollutants that is subject to 
a standard or other requirement under Section 112 may be subject to the 
requirement to obtain a title V permit. Currently, the requirement to 
obtain a title V permit has been deferred for such sources, as noted in 
each applicable standard 1. If at any time in the future EPA 
requires these nonmajor sources of HAPs to obtain a title V permit, it 
is EPA's intent that these nonmajor sources be permitted under the 
local alternate permitting program authorized by today's rule. Sources 
subject to Section 112 standards under 40 CFR part 63 should refer to 
the applicable subpart of part 63 for the dates required for submission 
of permit applications.
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    \1\ On June 3, 1996, EPA published in the Federal Register (61 
FR 27785) an amendment to certain hazardous air pollutant standards 
for Chromium Electroplating and Chromium Anodizing Tanks (subpart 
N); Ethylene Oxide Commercial Sterilization and Fumigation 
Operations (subpart O); Perchloroethylene Dry Cleaning Facilities 
(subpart M); and Secondary Lead Smelting (subpart X). In that 
action, EPA amended the requirement in each of these rules that 
required nonmajor sources (emitting or having the potential to emit 
less than 10 tons per year of any hazardous air pollutant or less 
than 25 tons per year of any combination of hazardous air 
pollutants) to obtain Title V permits. For certain of these nonmajor 
sources, the rules have been amended to allow the permitting 
authority the option of deferring the requirement to obtain a title 
V permit for 5 years. Certain nonmajor sources subject to subpart N 
of part 63 (Chromium Anodizing Tanks) that are not located at major 
sources are permanently exempted from the requirement to obtain a 
title V permit consistent with 40 CFR Sec. 63.340(e)(1) (61 FR 
27787, June 3, 1996). Any nonmajor batch cold solvent cleaning 
machines subject to subpart T of part 63 (Halogenated Solvent 
Cleaners) that are not located at major sources are permanently 
exempted from the requirement to obtain a title V permit consistent 
with 40 CFR Sec. 63.468(j) (59 FR 61801, December 2, 1994). For any 
other nonmajor solvent cleaning machines subject to subpart T of 
part 63 (Halogenated Solvent Cleaners) that are not located at major 
sources, the rules have been amended to allow the permitting 
authority the option of deferring the requirement to obtain a title 
V permit for 5 years (59 FR 61801, December 2, 1994).
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1. Title V Permits
    As noted earlier, title V requires that EPA implement a federal 
operating permitting program in any area that does not have an approved 
title V program (Section 502(e) of the Act, 42 U.S.C. 7661(e)). The 
part 71 program at 40 CFR part 71 (61 FR 34202) became effective on 
July 31, 1996. EPA's proposal of September 13, 1995 required that the 
existing major sources of HAPs, and owners and operators of any new 
source on Guam subject to title V because it is a major source under 
section 112, or a solid waste incinerator subject to section 129, 
obtain title V permits under part 71. In the proposal EPA requested 
comments on whether any existing municipal waste incinerators or major 
HAP sources on American Samoa and CNMI should be required to obtain 
title V permits under part 71. No comments were received. EPA has 
decided that the exemptions for Guam, American Samoa, and CNMI 
authorized in today's action do not apply to these solid waste 
incinerators and major HAP sources and that owners or operators of 
these sources must obtain part 71 permits. This final rule will ensure 
that section 112 standards that apply to major sources of HAPs are 
appropriately implemented through the title V operating permit program. 
Section 112 of the Clean Air Act recognizes that HAP sources can have a 
significant impact on human health regardless of geographic location, 
and section 325 of the Act explicitly prohibits waivers from section 
112 requirements. Because sections 112 and 129 generally rely on an 
effective title V permitting program to ensure that the standards are 
implemented correctly and HAP reductions are achieved, EPA believes 
that sources subject to section 129 and major sources of HAPs must have 
title V permits. Several sources on Guam currently subject to Section 
112 standards did not meet the deadline for submitting initial 
applicability notifications to EPA. EPA believes that expeditious 
compliance with title V will resolve any potential applicability 
questions or compliance problems for title V sources and that waiving 
title V for these sources could result in confusion and greater 
emissions of HAPs. EPA believes that regulating these sources under 
title V will not impose an undue burden, because, as noted above, EPA 
has deferred nonmajor HAP sources from the requirement to obtain a 
title V permit.
    EPA will be the permitting authority and will issue title V permits 
to these sources under part 71, as each of the petitioners has 
demonstrated that it currently lacks the technical resources to issue a 
title V permit. EPA published a Federal Register Notice on July 31, 
1996 (61 FR 39877, July 31, 1996), listing the state and local 
jurisdictions where a Federal Operating Permits Program became 
effective on that day. This notice included Guam, American Samoa and 
CNMI. Applications for major sources of HAPs and solid waste 
incinerators under part 71 are due to be submitted to the permitting 
authority by July 31, 1997, except for those major perchloroethylene 
dry cleaning facilities, which are due by April 1, 1997.
2. Case-By-Case Maximum Achievable Control Technology (MACT) 
Determinations
    Section 112 MACT requirements for case-by-case MACT determinations 
apply to major sources in certain situations where EPA has not 
promulgated an applicable MACT standard. Section 112 (j) requires that 
where EPA has missed a deadline for promulgating a section 112(d) 
standard then any major source of HAPs in the applicable source 
category must submit an application for a case-by-case MACT 
determination within 18 months of the missed deadline. Section 112(g) 
sets forth certain case-by-case MACT requirements for newly constructed 
or reconstructed sources. These requirements apply to all major sources 
of HAPs in American Samoa, CNMI, and Guam after the effective date of 
part 71.
    The regulations implementing 112(j) at 40 CFR part 63, subpart B, 
apply as of the effective date of part 71 (July 31, 1996), but the 
petitioners' source inventories indicate that there are no major 
sources that are subject to 112(j) at this time. Should any source be 
subject to this requirement, EPA will use part 71 permit applications 
as the compliance mechanism for implementing these case-by-case MACT 
approvals, as the petitioners have demonstrated that they lack the 
technical resources to conduct such a determination.
    EPA recently reopened the comment period and published a notice of 
availability of a draft rule implementing Section 112(g) (61 FR 13125, 
March 26, 1996). After the 112(g) regulation becomes effective, any 
newly constructed or reconstructed major source of HAPs in each 
territory must comply with a MACT level of control. This will be 
determined on a case-by-case basis when no applicable standard has been 
promulgated by EPA. Any new source subject to section 112(g) must apply 
for case-by-case MACT approval after the effective date of the 
regulation.

[[Page 58289]]

    Other section 112 requirements, such as 112(d) MACT standards, 
automatically apply to all HAP sources in American Samoa, CNMI, and 
Guam. This exemption does not waive any Section 112 requirements 
applicable to any sources; this rule only exempts the nonmajor sources 
from the requirement to obtain a part 71 permit.
    EPA's proposal required that American Samoa and CNMI develop an 
implementation agreement with EPA regarding hazardous air pollutant 
sources, but EPA believes that the EPA's implementation of part 71 
(which includes section 129(e) solid waste incinerators and major HAP 
sources) renders this agreement unnecessary as a waiver condition.

D. Effective Date of Title V Approval for Other Programs

    In addition to sections 112(g) and 112(j), the implementation of 
other regulations may depend on the approval date of a title V 
permitting program. For instance, EPA has considered implementing 40 
CFR part 64 compliance assurance monitoring through title V permitting 
programs, and other future regulations may also be implemented or 
triggered by the effective date of an approved title V program. In this 
case, for sources that are not required to obtain a part 71 permit 
under today's rule, the local alternate operating permit programs, 
after approval by EPA, will implement all applicable requirements, 
including any part 64 monitoring rule. This rule grants a conditional 
exemption to owners and operators only from the requirement to obtain a 
title V permit and to each territory from the requirement to adopt a 
title V program. All sources on American Samoa, CNMI, and Guam must 
comply with all other applicable Clean Air Act provisions. For any 
requirement other than the case-by-case MACT requirement addressed 
above that is implemented or triggered by an approved title V program, 
the implementation or trigger date is July 31, 1996, the date 
individual sources became subject to part 71.

E. Air Quality Modeling and SIP Submittals

    In the proposal, EPA discussed potential problems with air quality 
on American Samoa and CNMI and required these territories to conduct 
modeling and make any SIP revision necessary to ensure compliance with 
the NAAQS. EPA is retaining the requirements for American Samoa and 
CNMI set forth in the proposal for air quality modeling and SIP 
submittals.

III. Administrative Requirements

A. Executive Order 12866

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

B. Regulatory Flexibility Act

    This action under section 325 of the Act does not impose new 
requirements, but allows local agencies flexibility to reduce the 
impacts of title V on small entities. Because this action does not 
impose any new requirements, and merely approves requests for 
additional flexibility to meet existing requirements, it does not have 
a significant impact on a substantial number of small entities.

C. Unfunded Mandates

    Under Section 202 of the Unfunded Mandates Reform Act of 1995, 
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 this exemption 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 exemptions requested to 
reduce the cost of implementing the Clean Air Act. Accordingly, this 
action will reduce costs to state governments and the private sector.

D. Small Business Regulatory Enforcement Fairness Act

    Under 5 U.S.C. 801(a)(1)(A) as added by the Small Business 
Regulatory Enforcement Fairness Act of 1996, EPA submitted a report 
containing this rule and other required information to the U.S. Senate, 
the U.S. House of Representatives and the Comptroller General of the 
General Accounting Office prior to publication of the rule in today's 
Federal Register. This rule is not a ``major rule'' as defined by 5 
U.S.C. 804(2).

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

List of Subjects in 40 CFR Part 69

    Environmental protection, Administrative practice and procedure, 
Air pollution control, Hazardous air pollutants, Intergovernmental 
relations, Nitrogen oxides, Operating permits, Reporting and 
recordkeeping requirements, Sulfur dioxide, Volatile organic compounds.

    Dated: October 28, 1996.
Carol M. Browner,
Administrator.
    40 CFR part 69 is amended as follows:

PART 69--[AMENDED]

    1. The authority citation for part 69 continues to read as follows:

    Authority: Sec. 325, Clean Air Act, as amended (42 U.S.C. 7625-
1).

Subpart A--Guam

    2. Subpart A is amended by adding Sec. 69.13 to read as follows:


Sec. 69.13  Title V conditional exemption.

    (a) Conditional exemption. In response to a petition submitted by 
the Governor of Guam and pursuant to section 325(a) of the Clean Air 
Act (Act), the Administrator of the United States EPA (EPA) grants the 
following conditional exemptions:
    (1) Guam is exempted from the requirement to develop, submit for 
approval, and implement an operating permit program under title V of 
the Clean Air Act on the condition that Guam meets the requirements of 
paragraph (b) of this section and subject to the provisions of 
paragraphs (c) through (e) of this section.
    (2) Except for sources listed under paragraph (a)(4) of this 
section, owners or operators of sources located in Guam subject to the 
operating permit requirements of title V of the Clean Air Act are 
exempt from the requirement to apply for and obtain a title V operating 
permit, on the condition that the owner or operator of each such source 
must apply for and obtain an operating permit under an EPA approved 
alternate program that meets the requirements of paragraph (b) of this 
section and subject to the provisions of paragraphs (c) through (e) of 
this section. The owner or operator of each such source shall apply for 
and obtain a permit under the alternate operating permit program by the 
deadlines set forth in the approved program, but in any event shall 
obtain a permit no later than March 14, 2003. If the owner or operator 
of any source has not obtained an operating permit under an alternate 
operating program approved by EPA for Guam by March 14, 2003, the 
exemption for such source

[[Page 58290]]

shall expire and the owner or operator of such source shall become 
subject to the permitting requirements of 40 CFR part 71 on that date, 
consistent with paragraph (d)(4) of this section.
    (3) Upon EPA approval of an alternate operating permit program 
adopted by Guam in accordance with this Sec. 69.13, a person shall not 
violate any permit condition or term in a permit that has been issued 
under such alternate permit program.
    (4) This exemption does not apply to owners or operators of major 
sources of hazardous air pollutants (HAPs) as defined under section 112 
of the Clean Air Act or to owners or operators of solid waste 
incinerators subject to the title V requirements of section 129(e) of 
the Act. Owners or operators of major sources of HAPs or solid waste 
incinerators shall be subject to the requirements of 40 CFR part 71 and 
shall apply for and obtain a part 71 permit by the deadlines specified 
in 40 CFR part 71. Any owner or operator of a major source of HAPs 
subject to 40 CFR part 63, subpart B, shall submit a timely part 71 
permit application as required by 40 CFR part 71 and 40 CFR part 63, 
subpart B, requesting a case-by-case section 112(g) or 112(j) Maximum 
Achievable Control Technology (MACT) determination.
    (b) Requirements for the alternate operating program. Guam shall 
develop and submit an alternate operating permit program (the program) 
to EPA for approval. Upon approval by EPA, Guam shall implement the 
program. The program, including the necessary statutory and regulatory 
authority, must be submitted by March 15, 1999 for approval. The 
submittal shall include the following elements:
    (1) The program must contain regulations that ensure that:
    (i) The permits shall include emission limits and standards, and 
other terms or conditions necessary to ensure compliance with all 
applicable federal requirements, as defined under 40 CFR 70.2.
    (ii) The limitations, controls, and requirements in the permits 
shall be permanent, quantifiable, and otherwise enforceable as a 
practical matter.
    (iii) Permits shall contain monitoring, recordkeeping and reporting 
requirements sufficient to ensure compliance with applicable federal 
requirements during the reporting period.
    (iv) The program shall require that the owner or operator of each 
source submit permit applications with compliance certifications 
describing the source's compliance status with all applicable 
requirements. The program shall also provide that each permit contain a 
requirement that the owner or operator of a source submit annual 
compliance certifications. The compliance certification shall contain a 
compliance plan, and shall contain a schedule for expeditiously 
achieving compliance if the source is not in compliance with all 
applicable requirements. The program must provide that approval of a 
permit with a compliance plan and schedule does not sanction 
noncompliance.
    (2) The program shall provide for the collection of fees from 
permitted sources or other revenues in an amount that will pay for the 
cost of operation of such a program and ensure that these funds are 
used solely to support the program.
    (3) The program shall provide for public notice and a public 
comment period of at least 30 days for each permit, significant permit 
modification, and permit renewal, and shall include submittal to EPA of 
each permit, significant permit modification, and permit renewal.
    (4) The program shall provide EPA at least 45 days from receipt of 
a permit, modification, or renewal for EPA review and objection prior 
to issuance. The program shall provide that if EPA objects to a permit 
sent to EPA for review, Guam cannot issue such permit until the permit 
is revised in a manner that resolves EPA's objections. The program 
shall provide that Guam will have no more than 180 days to resolve 
EPA's objections and that if the objections are not resolved within 
that time period, EPA shall issue the permit under 40 CFR part 71.
    (5) The program shall provide that all documents other than 
confidential business information will be made available to the public.
    (6) The program shall provide Guam with the authority to enforce 
permits, including the authority to assess civil and criminal penalties 
up to $10,000 per day per violation and to enjoin activities that are 
in violation of the permit, the program, or the Act without first 
revoking the permit.
    (7) The program shall require that owners or operators of nonmajor 
sources of hazardous air pollutants that are required to obtain title V 
permits, and owners or operators of major sources of all other air 
pollutants as defined at 40 CFR 70.2 that are exempted from 40 CFR part 
71 under paragraph (a) of this section, obtain an operating permit 
under the approved program. The program shall include a schedule for 
issuing permits to all subject sources within three years of EPA 
approval of the program.
    (8) The program shall include a system of regular inspections of 
permitted sources, a system to identify any unpermitted major sources, 
and guidelines for appropriate responses to violations.
    (9) The program shall provide for the issuance of permits with a 
fixed term that shall not exceed five years.
    (10) The program shall allow Guam or the EPA to reopen a permit for 
cause. The program shall provide that if EPA provides Guam with written 
notice that a permit must be reopened for cause, Guam shall issue a 
revised permit within 180 days (including public notice and comment) 
that sufficiently addresses EPA's concerns. The program shall provide 
that if Guam fails to issue a permit that resolves EPA's concerns 
within 180 days, then EPA will terminate, modify, or revoke and reissue 
the permit under part 71 after providing the permittee and the public 
with notice and opportunity for comment.
    (c) State Implementation Plan (SIP) submittal. In conjunction with 
the submittal of the alternative operating permit program, Guam shall, 
no later than March 15, 1999 submit a revision to its SIP that provides 
that a person shall not violate a permit condition or term in an 
operating permit that has been issued under an EPA approved alternate 
operating permit program adopted by Guam pursuant to the exemption 
authorized in this Sec. 69.13.
    (d) Expiration and revocation of the exemption. This exemption 
shall expire or may be revoked under the following circumstances:
    (1) If Guam fails to submit an alternate operating permit program 
by March 15, 1999, the exemption shall automatically expire with no 
further rulemaking and 40 CFR part 71 shall become effective for all 
subject sources in Guam on that date.
    (2) In the event that EPA disapproves Guam's alternate operating 
permit program because the program does not meet the requirements set 
forth in paragraph (b) of this section, EPA will revoke the exemption 
by rulemaking.
    (3) If, by March 14, 2003, the owner or operator of any subject 
source has not obtained a federally enforceable operating permit under 
an EPA approved program, the exemption shall automatically expire for 
such source and such source shall be subject to the permitting 
requirements of 40 CFR part 71. Guam will work with EPA to identify 
such sources prior to expiration of the exemption under this paragraph 
(d).
    (4) EPA shall revoke the exemption in its entirety through 
rulemaking if Guam does not adequately administer and

[[Page 58291]]

enforce an alternate operating permit program approved by EPA.
    (5) EPA shall revoke the exemption by rulemaking with respect to 
the owner or operator of any source if, during the 45-day review 
period, EPA objects to issuance of a permit and Guam fails to resolve 
EPA's objections within 180 days. EPA shall also revoke the exemption 
by rulemaking for the owner or operator of any source in the event that 
EPA reopens a permit for cause and Guam does not issue a permit that 
resolves the concerns as set forth in EPA's notice to reopen within 180 
days.
    (6) EPA reserves its authority to revoke or modify this exemption 
in whole or in part.
    (e) Scope of the exemption. This exemption applies solely to the 
requirement that an owner or operator obtain an operating permit under 
title V of the Clean Air Act and the requirement that Guam implement a 
title V permit program. In addition, this exemption does not apply to 
owners or operators of sources set forth in paragraph (a)(4) of this 
section. Owners and operators of air pollutant sources are required to 
comply with all other applicable requirements of the Clean Air Act. For 
purposes of complying with any applicable requirement that is triggered 
or implemented by the approval of a title V permit program, the 
approval date for owners or operators to which this exemption applies 
shall be the date that EPA approves the alternate program for each 
territory or, for owners or operators of sources that are subject to 40 
CFR part 71, the approval date shall be the effective date of 40 CFR 
part 71, which is July 31, 1996.
    3. Subpart B is amended by revising the subpart heading and adding 
Sec. 69.22 to read as follows:

Subpart B--American Samoa


Sec. 69.22  Title V conditional exemption.

    (a) Conditional exemption. In response to a petition submitted by 
the Governor of American Samoa (American Samoa) and pursuant to section 
325(a) of the Clean Air Act (Act), the Administrator of the United 
States EPA (EPA) grants the following conditional exemptions:
    (1) American Samoa is exempted from the requirement to develop, 
submit for approval, and implement an operating permit program under 
title V of the Clean Air Act on the condition that American Samoa meets 
the requirements of paragraph (b) of this section and subject to the 
provisions of paragraphs (c) through (f) of this section.
    (2) Except for sources listed under paragraph (a)(4) of this 
section, owners or operators of sources located in American Samoa 
subject to the operating permit requirements of title V of the Clean 
Air Act are exempt from the requirement to apply for and obtain a title 
V operating permit, on the condition that the owner or operator of each 
such source must apply for and obtain an operating permit under an EPA 
approved alternate program that meets the requirements of paragraph (b) 
of this section and subject to the provisions of paragraphs (c) through 
(f) of this section. The owner or operator of each such source shall 
apply for and obtain a permit under the alternate operating permit 
program by the deadlines set forth in the approved program, but in any 
event shall obtain a permit no later than March 14, 2003. If the owner 
or operator of any source has not obtained an operating permit under an 
alternate operating program approved by EPA for American Samoa by March 
14, 2003, the exemption for such source shall expire and the owner or 
operator of such source shall become subject to the permitting 
requirements of 40 CFR part 71 on that date, consistent with paragraph 
(e)(4) of this section.
    (3) Upon EPA approval of an alternate operating permit program 
adopted by American Samoa in accordance with this Sec. 69.22, a person 
shall not violate any permit condition or term in a permit that has 
been issued under such alternate permit program.
    (4) This exemption does not apply to owners or operators of major 
sources of hazardous air pollutants (HAPs) as defined under section 112 
of the Clean Air Act or to owners or operators of solid waste 
incinerators subject to the title V requirements of section 129(e) of 
the Act. Owners or operators of major sources of HAPs or solid waste 
incinerators shall be subject to the requirements of 40 CFR part 71 and 
shall apply for and obtain a part 71 permit by the deadlines specified 
in 40 CFR part 71. Any owner or operator of a major source of HAPs 
subject to 40 CFR part 63, subpart B, shall submit a timely part 71 
permit application as required by 40 CFR part 71 and 40 CFR part 63, 
subpart B, requesting a case-by-case 112(g) or 112(j) Maximum 
Achievable Control Technology (MACT) determination.
    (b) Requirements for the alternate operating program. American 
Samoa shall develop and submit an alternate operating permit program 
(the program) to EPA for approval. Upon approval by EPA, American Samoa 
shall implement the program. The program, including the necessary 
statutory and regulatory authority, must be submitted by March 15, 1999 
for approval. The submittal shall include the following elements:
    (1) The program must contain regulations that ensure that:
    (i) The permits shall include emission limits and standards, and 
other terms or conditions necessary to ensure compliance with all 
applicable federal requirements, as defined under 40 CFR 70.2.
    (ii) The limitations, controls, and requirements in the permits 
shall be permanent, quantifiable, and otherwise enforceable as a 
practical matter.
    (iii) Permits shall contain monitoring, recordkeeping and reporting 
requirements sufficient to ensure compliance with applicable federal 
requirements during the reporting period.
    (iv) The program shall require that the owner or operator of each 
source submit permit applications with compliance certifications 
describing the source's compliance status with all applicable 
requirements. The program shall also provide that each permit contain a 
requirement that the owner or operator of a source submit annual 
compliance certifications. The compliance certification shall contain a 
compliance plan, and shall contain a schedule for expeditiously 
achieving compliance if the source is not in compliance with all 
applicable requirements. The program must provide that approval of a 
permit with a compliance plan and schedule does not sanction 
noncompliance.
    (2) The program shall provide for the collection of fees from 
permitted sources or other revenues in an amount that will pay for the 
cost of operation of such a program and ensure that these funds are 
used solely to support the program.
    (3) The program shall provide for public notice and a public 
comment period of at least 30 days for each permit, significant permit 
modification, and permit renewal, and shall include submittal to EPA of 
each permit, significant permit modification, and permit renewal.
    (4) The program shall provide EPA at least 45 days from receipt of 
a permit, modification, or renewal for EPA review and objection prior 
to issuance. The program shall provide that if EPA objects to a permit 
sent to EPA for review, American Samoa cannot issue such permit until 
the permit is revised in a manner that resolves EPA's objections. The 
program will provide that American Samoa will have no more than 180 
days to resolve EPA's objections and that if the objections are not 
resolved within that time period, EPA shall issue the permit under 40 
CFR part 71.

[[Page 58292]]

    (5) The program shall provide that all documents other than 
confidential business information will be made available to the public.
    (6) The program shall provide American Samoa with the authority to 
enforce permits, including the authority to assess civil and criminal 
penalties up to $10,000 per day per violation and to enjoin activities 
that are in violation of the permit, the program, or the Act without 
first revoking the permit.
    (7) The program shall require that owners or operators of nonmajor 
sources of hazardous air pollutants that are required to obtain title V 
permits, and owners or operators of major sources of all other air 
pollutants as defined in 40 CFR 70.2 that are exempted from 40 CFR part 
71 under paragraph (a) of this section, obtain an operating permit 
under the approved program. The program shall include a schedule for 
issuing permits to all subject sources within three years of EPA 
approval of the program.
    (8) The program shall include a system of regular inspections of 
permitted sources, a system to identify any unpermitted major sources, 
and guidelines for appropriate responses to violations.
    (9) The program shall provide for the issuance of permits with a 
fixed term that shall not exceed five years.
    (10) The program shall allow American Samoa or the EPA to reopen a 
permit for cause. The program shall provide that if EPA provides 
American Samoa with written notice that a permit must be reopened for 
cause, American Samoa shall issue a revised permit within 180 days 
(including public notice and comment) that sufficiently addresses EPA's 
concerns. The program shall provide that if American Samoa fails to 
issue a permit that resolves EPA's concerns within 180 days, then EPA 
will terminate, modify, or revoke and reissue the permit under part 71 
after providing the permittee and the public with notice and 
opportunity for comment.
    (c) Ambient air quality program. American Samoa shall implement the 
following program to address the National Ambient Air Quality Standards 
(NAAQS) as a condition of the waiver:
    (1) American Samoa shall collect complete meteorological data and 
complete refined air quality modeling for the Pago Pago Harbor and 
submit such data and modeling results to EPA by March 15, 1999.
    (2) American Samoa shall address any NAAQS exceedances demonstrated 
through the modeling results with revisions to its SIP that shall be 
submitted by March 14, 2000. The plan shall ensure compliance with the 
NAAQS is achieved by March 14, 2002.
    (d) State Implementation Plan (SIP) submittal. In conjunction with 
the submittal of the alternative operating permit program, American 
Samoa shall, no later than March 15, 1999, submit a revision to its SIP 
that provides that a person shall not violate a permit condition or 
term in an operating permit that has been issued under an EPA approved 
alternate operating permit program adopted by American Samoa pursuant 
to the exemption authorized in this Sec. 69.22.
    (e) Expiration and revocation of the exemption. This exemption 
shall expire or may be revoked under the following circumstances:
    (1) If American Samoa fails to submit the required alternate 
operating permit program or modeling (and supporting data) by March 15, 
1999, the exemption shall automatically expire with no further 
rulemaking and 40 CFR part 71 shall become effective for all subject 
sources in American Samoa on that date. The exemption will also expire 
with no further rulemaking in the event that American Samoa fails to 
submit a SIP revision by March 14, 2000, consistent with paragraph 
(c)(2) of this section.
    (2) In the event that EPA disapproves American Samoa's alternate 
operating permit program because the program does not meet the 
requirements set forth in paragraph (b) of this section, EPA will 
revoke the exemption by rulemaking.
    (3) If, by March 14, 2003, the owner or operator of any subject 
source has not obtained a federally enforceable operating permit under 
an EPA approved program, the exemption shall automatically expire for 
such source and such source shall be subject to the permitting 
requirements of 40 CFR part 71. American Samoa will work with EPA to 
identify such sources prior to expiration of the exemption under this 
paragraph (d).
    (4) EPA shall revoke the exemption in its entirety through 
rulemaking if American Samoa does not adequately administer and enforce 
an alternate operating permit program approved by EPA.
    (5) EPA shall revoke the exemption by rulemaking with respect to 
the owner or operator of any source if, during the 45-day review 
period, EPA objects to issuance of a permit and American Samoa fails to 
resolve EPA's objections within 180 days. EPA shall also revoke the 
exemption by rulemaking for the owner or operator of any source in the 
event that EPA reopens a permit for cause and American Samoa does not 
issue a permit that resolves the concerns as set forth in EPA's notice 
to reopen within 180 days.
    (6) EPA reserves its authority to revoke or modify this exemption 
in whole or in part.
    (f) Scope of the exemption. This exemption applies solely to the 
requirement that an owner or operator obtain an operating permit under 
title V of the Clean Air Act and the requirement that American Samoa 
implement a title V permit program. In addition, this exemption does 
not apply to owners or operators of sources set forth in paragraph 
(a)(4) of this section. Owners and operators of air pollutant sources 
are required to comply with all other applicable requirements of the 
Clean Air Act. For purposes of complying with any applicable 
requirement that is triggered or implemented by the approval of a title 
V permit program, the approval date for owners or operators to which 
this exemption applies shall be the date that EPA approves the 
alternate program for each territory or, for owners or operators of 
sources that are subject to 40 CFR part 71, the approval date shall be 
the effective date of 40 CFR part 71, which is July 31, 1996.
    4. Subpart C is amended by revising the subpart heading and adding 
Sec. 69.32 to read as follows:

Subpart C--Commonwealth of the Northern Mariana Islands


Sec. 69.32  Title V conditional exemption.

    (a) Conditional exemption. In response to a petition submitted by 
the Governor of The Commonwealth of the Northern Mariana Islands (CNMI) 
and pursuant to section 325(a) of the Clean Air Act (Act), the 
Administrator of the United States EPA (EPA) grants the following 
conditional exemptions:
    (1) CNMI is exempted from the requirement to develop, submit for 
approval, and implement an operating permit program under title V of 
the Clean Air Act on the condition that CNMI meets the requirements of 
paragraph (b) of this section and subject to the provisions of 
paragraphs (c) through (f) of this section.
    (2) Except for sources listed under paragraph (a)(4) of this 
section, owners or operators of sources located in CNMI subject to the 
operating permit requirements of title V of the Clean Air Act are 
exempt from the requirement to apply for and obtain a title V operating 
permit, on the condition that the owner or operator of each such source 
must apply for and obtain an operating permit under an EPA approved 
alternate program that meets the requirements of

[[Page 58293]]

paragraph (b) of this section and subject to the provisions of 
paragraphs (c) through (f) of this section. The owner or operator of 
each such source shall apply for and obtain a permit under the 
alternate operating permit program by the deadlines set forth in the 
approved program, but in any event shall obtain a permit no later than 
March 14, 2003. If the owner or operator of any source has not obtained 
an operating permit under an alternate operating program approved by 
EPA for CNMI by March 14, 2003, the exemption for such source shall 
expire and the owner or operator of such source shall become subject to 
the permitting requirements of 40 CFR part 71 on that date, consistent 
with paragraph (e)(3) of this section.
    (3) Upon EPA approval of an alternate operating permit program 
adopted by CNMI in accordance with this Sec. 69.32, a person shall not 
violate any permit condition or term in a permit that has been issued 
under such alternate permit program.
    (4) This exemption does not apply to owners or operators of major 
sources of hazardous air pollutants (HAPs) as defined under section 112 
of the Clean Air Act or to owners or operators of solid waste 
incinerators subject to the title V requirements of section 129(e) of 
the Act. Owners or operators of major sources of HAPs or solid waste 
incinerators shall be subject to the requirements of 40 CFR part 71 and 
shall apply for and obtain a part 71 permit by the deadlines specified 
in 40 CFR part 71. Any owner or operator of a major source of HAPs 
subject to 40 CFR part 63, subpart B, shall submit a timely part 71 
permit application as required by 40 CFR part 71 and 40 CFR part 63, 
subpart B, requesting a case-by-case section 112(g) or 112(j) Maximum 
Achievable Control Technology (MACT) determination.
    (b) Requirements for the alternate operating program. CNMI shall 
develop and submit an alternate operating permit program (the program) 
to EPA for approval. Upon approval by EPA, CNMI shall implement the 
program. The program, including the necessary statutory and regulatory 
authority, must be submitted by March 15, 1999 for approval. The 
submittal shall include the following elements:
    (1) The program must contain regulations that ensure that:
    (i) The permits shall include emission limits and standards, and 
other terms or conditions necessary to ensure compliance with all 
applicable federal requirements, as defined under 40 CFR 70.2.
    (ii) The limitations, controls, and requirements in the permits 
shall be permanent, quantifiable, and otherwise enforceable as a 
practical matter.
    (iii) Permits shall contain monitoring, recordkeeping and reporting 
requirements sufficient to ensure compliance with applicable federal 
requirements during the reporting period.
    (iv) The program shall require that the owner or operator of each 
source submit permit applications with compliance certifications 
describing the source's compliance status with all applicable 
requirements. The program shall also provide that each permit contain a 
requirement that the owner or operator of a source submit annual 
compliance certifications. The compliance certification shall contain a 
compliance plan, and shall contain a schedule for expeditiously 
achieving compliance if the source is not in compliance with all 
applicable requirements. The program must provide that approval of a 
permit with a compliance plan and schedule does not sanction 
noncompliance.
    (2) The program shall provide for the collection of fees from 
permitted sources or other revenues in an amount that will pay for the 
cost of operation of such a program and ensure that these funds are 
used solely to support the program.
    (3) The program shall provide for public notice and a public 
comment period of at least 30 days for each permit, significant permit 
modification, and permit renewal, and shall include submittal to EPA of 
each permit, significant permit modification, and permit renewal.
    (4) The program shall provide EPA at least 45 days from receipt of 
a permit, modification, or renewal for EPA review and objection prior 
to issuance. The program shall provide that if EPA objects to a permit 
sent to EPA for review, CNMI cannot issue such permit until the permit 
is revised in a manner that resolves EPA's objections. The program will 
provide that CNMI will have no more than 180 days to resolve EPA's 
objections and that if the objections are not resolved within that time 
period, EPA shall issue the permit under 40 CFR part 71.
    (5) The program shall provide that all documents other than 
confidential business information will be made available to the public.
    (6) The program shall provide CNMI with the authority to enforce 
permits, including the authority to assess civil and criminal penalties 
up to $10,000 per day per violation and to enjoin activities that are 
in violation of the permit, the program, or the Act without first 
revoking the permit.
    (7) The program shall require that owners or operators of nonmajor 
sources of hazardous air pollutants that are required to obtain title V 
permits, and owners or operators of major sources of all other air 
pollutants as defined at 40 CFR 70.2 that are exempted from 40 CFR part 
71 under paragraph (a) of this section, obtain an operating permit 
under the approved program. The program shall include a schedule for 
issuing permits to all subject sources within three years of EPA 
approval of the program.
    (8) The program shall include a system of regular inspections of 
permitted sources, a system to identify any unpermitted major sources, 
and guidelines for appropriate responses to violations.
    (9) The program shall provide for the issuance of permits with a 
fixed term that shall not exceed five years.
    (10) The program shall allow CNMI or the EPA to reopen a permit for 
cause. The program shall provide that if EPA provides CNMI with written 
notice that a permit must be reopened for cause, CNMI shall issue a 
revised permit within 180 days (including public notice and comment) 
that sufficiently addresses EPA's concerns. The program shall provide 
that if CNMI fails to issue a permit that resolves EPA's concerns 
within 180 days, then EPA will terminate, modify, or revoke and reissue 
the permit under part 71 after providing the permittee and the public 
with notice and opportunity for comment.
    (c) Ambient air quality program. CNMI shall implement the following 
program to protect attainment of National Ambient Air Quality Standards 
(NAAQS) as a condition of the waiver:
    (1) CNMI shall enforce its January 19, 1987 Air Pollution Control 
(APC) regulations, including the requirement that all new or modified 
sources comply with the NAAQS and Prevention of Significant 
Deterioration (PSD) increments.
    (2) CNMI may conduct air emissions modeling, using EPA guidelines, 
for power plants located on Saipan to assess EPA's preliminary 
determination of non-compliance with the NAAQS for sulfur dioxide 
(SO2). CNMI shall complete and submit any additional modeling to 
EPA by March 16, 1998 to determine whether existing power plants cause 
or contribute to violation of the NAAQS and PSD increments in the APC 
regulations and 40 CFR 52.21.
    (3) If CNMI's additional modeling, based on EPA guidelines, 
predicts exceedances of the NAAQS for SO2, or if CNMI elects to 
accept EPA's preliminary determination that the NAAQS for SO2 have 
been exceeded,

[[Page 58294]]

CNMI shall submit a revised SIP that ensures compliance with the NAAQS 
for SO2. CNMI shall submit the proposed revision to the SIP by 
March 16, 1998 or, if CNMI elects to conduct additional modeling, by 
March 15, 1999. CNMI shall take appropriate corrective actions through 
the SIP to demonstrate compliance with the NAAQS for SO2 by March 
14, 2001.
    (d) State Implementation Plan (SIP) submittal. In conjunction with 
the submittal of the alternative operating permit program, CNMI shall, 
no later than March 15, 1999 submit a revision to its SIP that provides 
that a person shall not violate a permit condition or term in an 
operating permit that has been issued under an EPA approved alternate 
operating permit program adopted by CNMI pursuant to the exemption 
authorized in this Sec. 69.32.
    (e) Expiration and revocation of the exemption. This exemption 
shall expire or may be revoked under the following circumstances:
    (1) If CNMI fails to submit the required alternate operating permit 
program or any required SIP revision by March 15, 1999, the exemption 
shall automatically expire with no further rulemaking and 40 CFR part 
71 shall become effective for all subject sources in CNMI on that date, 
consistent with paragraph (c)(3) of this section.
    (2) In the event that EPA disapproves CNMI's alternate operating 
permit program because the program does not meet the requirements set 
forth in paragraph (b) of this section, EPA will revoke the exemption 
by rulemaking.
    (3) If, by March 14, 2003, the owner or operator of any subject 
source has not obtained a federally enforceable operating permit under 
an EPA approved program, the exemption shall automatically expire for 
such source and such source shall be subject to the permitting 
requirements of 40 CFR part 71. CNMI will work with EPA to identify 
such sources prior to expiration of the exemption under this paragraph 
(e).
    (4) EPA shall revoke the exemption in its entirety through 
rulemaking if CNMI does not adequately administer and enforce an 
alternate operating permit program approved by EPA.
    (5) EPA shall revoke the exemption by rulemaking with respect to 
the owner or operator of any source if, during the 45-day review 
period, EPA objects to issuance of a permit and CNMI fails to resolve 
EPA's objections within 180 days. EPA shall also revoke the exemption 
by rulemaking for the owner or operator of any source in the event that 
EPA reopens a permit for cause and CNMI does not issue a permit that 
resolves the concerns as set forth in EPA's notice to reopen within 180 
days.
    (6) EPA reserves its authority to revoke or modify this exemption 
in whole or in part.
    (f) Scope of the exemption. This exemption applies solely to the 
requirement that an owner or operator obtain an operating permit under 
title V of the Clean Air Act and the requirement that CNMI implement a 
title V permit program. In addition, this exemption does not apply to 
owners or operators of sources set forth in paragraph (a)(4) of this 
section. Owners and operators of air pollutant sources are required to 
comply with all other applicable requirements of the Clean Air Act. For 
purposes of complying with any applicable requirement that is triggered 
or implemented by the approval of a title V permit program, the 
approval date for owners or operators to which this exemption applies 
shall be the date that EPA approves the alternate program for each 
territory or, for owners or operators of sources that are subject to 40 
CFR part 71, the approval date shall be the effective date of 40 CFR 
part 71, which is July 31, 1996.

[FR Doc. 96-28432 Filed 11-12-96; 8:45 am]
BILLING CODE 6560-50-P