[Federal Register Volume 62, Number 14 (Wednesday, January 22, 1997)]
[Rules and Regulations]
[Pages 3216-3220]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-1425]


-----------------------------------------------------------------------


ENVIRONMENTAL PROTECTION AGENCY
40 CFR Part 52

[IN70-1a; FRL-5675-2]


Approval and Promulgation of Implementation Plans; Indiana

AGENCY: Environmental Protection Agency (EPA).

ACTION: Direct final rule.

-----------------------------------------------------------------------

SUMMARY: On February 13, 1996, and June 27, 1996, the State of Indiana 
submitted, as a requested revision to the State Implementation Plan 
(SIP) for ozone, 326 IAC 8-12, a rule controlling volatile organic 
compound (VOC) emissions from shipbuilding and ship repair coating 
operations in Clark, Floyd, Lake, and Porter Counties. This rule is 
part of the State's 15% Rate-of-Progress (ROP) plan for reducing VOC 
emissions in Clark and Floyd Counties. VOCs are air pollutants which 
combine with oxides of nitrogen to form ground-level ozone, a pollutant 
which can damage lung tissue and cause serious respiratory illness. ROP 
plans are intended to help areas with ozone problems attain the public 
health based Federal ozone air quality standard. Indiana expects that 
the control measures required by this requested SIP revision will 
reduce VOC emissions by 1,164 pounds per day in Clark and Floyd 
Counties. In this action, EPA is approving the requested SIP revision 
through a ``direct final'' rulemaking; the rationale for this approval 
is set forth in the supplementary information section of this 
rulemaking. Elsewhere in this Federal Register, EPA is proposing 
approval and soliciting comment on this direct final action; if adverse 
comments are received, EPA will withdraw the direct final and address 
the comments received in a new final rule; otherwise, no further 
rulemaking will occur on this requested SIP revision.

DATES: This final rule is effective March 24, 1997 unless adverse 
comments are received by February 21, 1997. If the effective date is 
delayed, timely notice will be published in the Federal Register.

ADDRESSES: Written comments can be mailed to: J. Elmer Bortzer, Chief, 
Regulation Development Section, Air Programs Branch (AR-18J), Air and 
Radiation Division, U.S. Environmental Protection Agency, 77 West 
Jackson Boulevard, Chicago, Illinois 60604.
    Copies of the SIP revision request are available for inspection at 
the following address: (It is recommended that you telephone Mark J. 
Palermo at (312) 886-6082, before visiting the Region 5 office.) U.S. 
Environmental Protection Agency, Region 5, Air and Radiation Division, 
77 West Jackson Boulevard, Chicago, Illinois 60604.

FOR FURTHER INFORMATION CONTACT: Mark J. Palermo, Air Programs Branch 
(AR-18J), (312) 886-6082.

SUPPLEMENTARY INFORMATION:

I. Background

    Section 182(b)(1) of the Act, as amended in 1990, requires all 
moderate and above ozone nonattainment areas to achieve a 15% reduction 
of 1990 emissions of VOC by November 15, 1996. In Indiana, Lake and 
Porter Counties are classified as ``severe'' nonattainment for ozone, 
while Clark and Floyd Counties are classified as ``moderate'' 
nonattainment. As such, these counties are subject to the 15%

[[Page 3217]]

ROP requirement. The Act specifies under section 182(b)(1)(C) that the 
15% emission reduction claimed under the ROP plan must be achieved 
through revisions to the SIP, the promulgation of federal rules, or 
through permits under Title V of the Act, by November 15, 1996.
    On September 6, 1995, the Indiana Air Pollution Control Board 
(IAPCB) adopted a shipbuilding and ship repair rule for purposes of 
meeting the State's 15% ROP plan requirements. Public hearings on the 
rule were held on June 7, 1995, and September 6, 1995, in Indianapolis, 
Indiana. The rule was signed by the Secretary of State on April 1, 
1996, and became effective on May 1, 1996; it was published in the 
Indiana State Register on May 1, 1996. The Indiana Department of 
Environmental Management (IDEM) formally submitted the rule to EPA on 
February 13, 1996, as a revision to the Indiana ozone SIP; supplemental 
documentation to this revision was submitted on June 27, 1996. EPA made 
a finding of completeness in a letter dated July 5, 1996.

II. Summary of Rule

    The February 13, 1996, and June 27, 1996, submittals include the 
following rule:

326 Indiana Administrative Code (IAC) 8-12  Shipbuilding or Ship Repair 
Operations in Clark, Floyd, Lake, and Porter Counties

    (1) Applicability.
    (2) Exemptions.
    (3) Definitions.
    (4) Volatile organic compound emissions limiting requirements.
    (5) Compliance requirements.
    (6) Test methods and procedures.
    (7) Record keeping, notification, and reporting requirements.
    A summary of the rule follows. For the complete requirements of 
this SIP revision, interested parties should see the 326 IAC 8-12 rule.

326 IAC 8-12-1  Applicability

    This section establishes which shipbuilding or ship repair 
operations are subject to the rule. Beginning November 1, 1995, 
shipbuilding or ship repair facilities which are (a) located in Clark 
or Floyd County which have the potential to emit 100 tons per year 
(TPY) of VOCs, or (b) located in Lake and Porter Counties which have 
the potential to emit 25 TPY of VOCs, are subject to the requirements 
of the rule.1 ``Shipbuilding and ship repair facility,'' as 
defined under section 3(21) of the rule, means any facility that 
builds, repairs, repaints, converts, or alters ships. Section 3(20) 
defines ``ship'' to mean any marine or freshwater vessel made of steel 
and used for military or commercial operations, including self-
propelled vessels, those propelled by other craft (barges), and 
navigational aids (buoys), and includes, but is not limited to, all of 
the following: (A) military and United States Coast Guard vessels, (B) 
commercial cargo and passenger (cruise) ships, (C) ferries, (D) barges, 
(E) tankers, (F) container ships, (G) patrol and pilot boats, and (H) 
dredges. For purposes of the rule, offshore oil and gas drilling 
platforms are not considered ships.
---------------------------------------------------------------------------

    \1\ The applicability thresholds of 100 TPY potential to emit 
for the Clark and Floyd Counties' moderate ozone nonattainment area, 
and 25 TPY potential to emit for the Lake and Porter Counties' 
severe ozone nonattainment area, are identical to the thresholds 
used to define `` major sources'' under the Act (See section 302(j), 
section 182(b)(2), and section 182(d) of the Act).
---------------------------------------------------------------------------

326 IAC 8-12-2  Exemptions

    This section exempts the following marine coatings from the rule's 
VOC content limitations in section 4: (1) any marine coating used in 
volumes of less than 20 gallons in any one calendar year, provided, 
however, the total of all exempt coatings shall not exceed 400 gallons 
in any 1 calendar year; (2) any marine coating applied using a hand-
held aerosol can; and (3) any marine coating used in a touch-up 
operation. However, these coatings are nonetheless subject to all other 
provisions contained in the rule, including record keeping requirements 
under section 7.

326 IAC 8-12-3  Definitions

    This section contains definitions which describe the terms used in 
the Indiana rule for compliance purposes, particularly in regard to the 
various coatings which are subject to limits under the rule.

326 IAC 8-12-4 Volatile organic compound emissions limiting 
requirements

    Section 4(a) requires that, on and after May 1, 1996, the owner or 
operator of a subject facility must meet certain VOC content limits 
when applying specialty coatings. Section 2(22) defines ``specialty 
coatings'' to include the following coatings: air flask coating, 
antenna coating, antifoulant coating, heat resistant coating, high-
gloss coating, high-temperature coating, inorganic zinc (high-build) 
coating, military exterior coating, mist coating, navigational aids 
coating, nonskid coating, nuclear coating, organic zinc coating, 
pretreatment wash primer coating, repair and maintenance of 
thermoplastic coating of commercial vessels, rubber camouflage coating, 
sealant coating for thermal spray aluminum, special marking coating, 
specialty interior coating, tack coating, undersea weapons systems 
coating, water based weld-through (shop) preconstruction primer, and 
weld-through (shop) preconstruction primer.
    Section 4(a) also requires that, beginning May 1, 1996, subject 
sources must meet certain VOC content limitations when applying general 
use coatings from May 1 through September 30. The limitations for 
specialty coatings apply year-round.
    The VOC content limits for specialty and general use coatings are 
as follows: 2
---------------------------------------------------------------------------

    \2\ ``VOC content'' is defined in section 2(25) of the Indiana 
rule as the weight of VOC, per unit volume of any general use or 
specialty coating or cleaning material, less water and less exempt 
compounds.

------------------------------------------------------------------------
                 Coating                             Lbs/gallon         
------------------------------------------------------------------------
Special Marking Coatings.................  4.08                         
Heat Resistant...........................  3.50                         
High Gloss...............................  3.50                         
High Temperature.........................  4.17                         
Weld-through (shop) preconstruction......  See below                    
All other specialty coatings.............  2.83                         
General use coating......................  2.83                         
------------------------------------------------------------------------

    No thinner shall be added to any general use coating when the 
general use coating limit is in effect. Weld-through (shop) 
preconstruction primers are required throughout the year to be water 
based and meet a VOC content limit of 0.00 when applied. No cleaning 
material shall be used in the primer application facility, and no 
thinner shall be added to the primer. Additionally, if the owner or 
operator determines that a water based weld-through (shop) 
preconstruction primer can no longer be used due to an operational, 
performance, or availability constraint, the rule provides that, as an 
alternative to meeting the primer requirement, the owner or operator 
can request IDEM for permission to comply by means of a control system 
with an overall VOC reduction efficiency of 95 percent, subject to 
certain provisions.
    Section 4(b) requires that on and after May 1, 1996, subject 
sources must use gasket-sealed containers to store used cleaning 
accessories, new and spent coating, and solvent. Cleaning materials for 
spray equipment, including spray lines, must be collected using 
equipment which collect the cleaning materials when used and minimize 
the materials evaporation into the atmosphere. All containers, tanks, 
vats, drums, and piping systems must be free

[[Page 3218]]

of cracks, holes, or other defects, and must be closed unless materials 
are being added or removed from them, and handling of the VOC-
containing materials shall be conducted in a manner that minimizes 
drips and spills, and any spills shall be cleaned up promptly.
    Section 4(c) requires that the owner or operator of a subject 
source must meet certain training program requirements. On or before 
January 1, 1996, the owner or operator must develop a written worker 
training program. This program shall contain written procedures, and 
hands-on demonstration, as appropriate, in order to instruct all 
workers, including contractors, that engage in activities regulated 
under the rule in how to comply with the rule when performing those 
activities. All affected personnel shall be certified by the trainer to 
have satisfactorily completed necessary training on or before May 1, 
1996, with refresher training prior to May 1, annually. Untrained 
employees can perform an activity covered under the training program 
for no longer than 180 days. Records shall be kept by the owner or 
operator of the training completed by each worker.

8-12-5 Compliance requirements

    Section 5 provides that the VOC content emission limits for 
coatings and cleaning materials contained in section 4 shall be 
achieved each day on an as-applied basis for each operating day (as 
defined by 326 IAC 8-12-3(18)), and that compliance with the work 
practice standards of section 4 shall be achieved each operating day. 
Compliance with VOC content limits shall be demonstrated using EPA 
Method 24, contained in 40 CFR part 60, Appendix A, or, if certain 
specified procedures are followed, a certificate from the coating 
manufacturer indicating compliance. Under section 3(7), this 
certification needs to attest to the VOC content as determined through 
analysis by EPA Method 24, or through use of the forms and procedures 
outlined in EPA publication EPA 450/3-84-019, revised June 1986. If any 
discrepancy exists between the manufacturer's certification and EPA 
Method 24, EPA Method 24 shall govern. (It should be noted that the 
owner or operator retains liability should subsequent testing reveal a 
violation).

326 IAC 8-12-6 Test methods and procedures

    This section specifies that 326 IAC 8-1-4, EPA Method 24 (40 CFR 
part 60, Appendix A), and section 5 of the rule shall be used to 
determine compliance with the rule. 326 IAC 8-1-4, the State's VOC rule 
testing procedures for coating and control system requirements, was 
approved by EPA and incorporated in the Indiana SIP on March 6, 1992 
(57 FR at 8082). 40 CFR Part 60 Appendix A is Method 24, EPA's 
established test method for determining VOC content in surface 
coatings.

326 IAC 8-12-7 Record keeping, notification, and reporting requirements

    Section 7(a) requires certain records be kept at a subject source 
for a minimum of 3 years. Subsection (a)(1) requires certification of 
annual employee training under the source's training program be kept. 
Subsection (a)(2) requires certain information regarding each coating 
used each working day of surface coating operation be recorded. Such 
information includes: the coating identification (trade name, 
manufacturer, coating category consistent with rule definitions, and 
applicable VOC content requirement); the VOC content of the coating, as 
supplied; certification of the VOC content of the supplied coating from 
the coating manufacturer, Material Safety Data Sheets (MSDS), or 
product data sheet for each coating used; the volume of the coating 
used; the thinner added to the coating, including thinner description, 
VOC content, and volume added. It should be noted that this record 
keeping requirement is applicable to coatings otherwise exempted from 
VOC content limitations in section 2.
    Subsection (a)(2) also requires that for each solvent used each 
working day, subject sources must keep records of the solvent 
description; solvent use (thinning or cleanup); VOC content; volume 
used for thinning; and volume used for cleanup.
    Subsection (a) (3) and (4) requires copies of the compliance plan 
and quarterly compliance report required under subsection (b). 
Subsection (b) requires that on or before January 1, 1996, each subject 
source shall submit to IDEM for review a compliance plan which 
addresses the source's required compliance procedures, training 
program, record keeping procedures, and procedures to comply with the 
rule's work practice standards. A source may revise its compliance plan 
upon notifying IDEM in writing that a major change in the source's 
operations has occurred. Beginning May 1, 1996, and within 60 days 
after the end of each quarter, each subject source shall submit a 
quarterly compliance report indicating the compliance status with the 
rule's work practice standards, training program, emission standards, 
compliance procedures, and provision of the compliance plan. Also 
required to be included in the report is each instance of 
noncompliance, the corrective action taken, and the reason for the 
noncompliance. Reporting frequency may be changed to semiannually after 
May 1, 1997, if a source requests such a change in writing, and IDEM 
approves it.

III. Evaluation of Rule

    As previously discussed, Indiana intends that this shipbuilding and 
ship repair SIP revision submittal will be one of the control measures 
which will satisfy 15% ROP plan requirements under the Act for Clark 
and Floyd Counties. A review of the emission reduction credit claimed 
for this rule for purposes of the Indiana 15% ROP plan will be 
addressed when EPA takes rulemaking action on the Clark and Floyd 15% 
ROP plan SIP. (EPA will take rulemaking on the overall 15% ROP plan in 
a subsequent rulemaking action.)
    On August 27, 1996, a Control Techniques Guidelines (CTG) document 
was published which recommends Reasonably Available Control Technology 
(RACT) control measures for shipbuilding and ship repair coating 
operations (61 FR 44050).3 In turn, states with moderate and above 
ozone nonattainment areas are required under section 182(b)(2) to 
submit a SIP revision providing regulations consistent with RACT for 
VOC source categories that are covered by a CTG issued after enactment 
of the Act's amendments of 1990, but prior to the time of attainment. 
This Act requirement, however, is separate from the requirement under 
section 182(b)(1) that states adopt and implement control measures to 
achieve 15% VOC reduction; such control measures need not constitute 
RACT to be creditable under the 15% ROP plan. Since the Indiana 
shipbuilding and ship repair rule was submitted primarily for purposes 
of the 15% ROP plan, was adopted and submitted before the CTG was 
published, and tightens the stringency of the SIP, EPA is approving the 
control measures contained in the Indiana rule at this time without

[[Page 3219]]

determining whether they satisfy RACT requirements under section 
182(b)(2).
---------------------------------------------------------------------------

    \3\ A definition of RACT is cited in a General Preamble-
Supplement on CTGs, published at 44 FR at 53761 (September 17, 
1979). RACT is defined as the lowest emission limitation that a 
particular source is capable of meeting by the application of 
control technology that is reasonably available, considering 
technological and economic feasibility. CTGs are documents intended 
to assist the States in determining RACT. The CTGs provide 
information on available air pollution control techniques and 
provide recommendations on what the EPA considers the ``presumptive 
norm'' for RACT.
---------------------------------------------------------------------------

    As for the remainder of the Indiana rule, EPA has reviewed the 
rule's definitions, exemptions, compliance methods, testing, and record 
keeping and recording requirement to determine whether the rule is 
enforceable. The definitions provided under section 3 of the rule are 
based upon definitions used in the promulgated national emissions 
standards for hazardous air pollutants (NESHAP) for this industry (60 
FR 64330, December 15, 1995). The rule's definitions adequately 
describe the terms used in the rule for purposes of compliance, and 
are, therefore, approvable.
    As for the coating exemption provision under section 2, EPA has 
requested that Indiana clarify what types of coating are covered under 
section 2(3): ``Any marine coating used in a touch-up operation.'' IDEM 
has stated in a September 3, 1996, letter that this exemption is 
intended only to apply to coatings which are used to repair minor 
surface damage and imperfections, and that this exemption does not 
apply to primary coatings (primers, general use, and specialty 
coatings) except when they are used in touch-up operations. The 
exemption provisions under section 2 are approvable.
    The provisions in section 5 which allow a source to demonstrate 
compliance through a certificate issued by the manufacturer certifying 
the VOC content of each batch of coating used are based upon similar 
compliance procedures promulgated in the shipbuilding and ship repair 
NESHAP. As was discussed before, this certification must, as provided 
under section 3(7), attest to the VOC content as determined through 
analysis by EPA Method 24, or through use of the forms and procedures 
outlined in EPA publication EPA 450/3-84-019, revised June 1986. If any 
discrepancy exists between the manufacturer's certification and EPA 
Method 24, EPA Method 24 shall govern. Also section 5(5) provides that 
IDEM or EPA may test or have tested any coating for VOC content using 
EPA Method 24, and if any discrepancies exist between the 
manufacturer's certification and EPA Method 24 test results, the Method 
24 test results shall take precedence. These compliance procedures are 
approvable.
    The rule's daily record keeping and quarterly reporting 
requirements under section 7 will assure that VOC content limits are 
met as applied and that any thinning of coating will not result in non-
compliance, and that the work practice standards and training 
requirements of the rule will be properly met. The rule's record 
keeping and reporting requirements are approvable.

IV. Final Action

    Indiana's rule covering ship building or ship repair operations, 
326 IAC 8-12, as submitted on February 13, 1996, and June 27, 1996, 
contain enforceable VOC control measures which tighten the stringency 
of the Indiana ozone SIP for Clark, Floyd, Lake, and Porter Counties. 
On this basis, the rule is approvable. EPA, however, is not rulemaking 
at this time as to whether this rule satisfies RACT requirements 
pursuant to section 182(b)(2) of the Act.
    The EPA is publishing this action without prior proposal because 
EPA views this as a noncontroversial revision and anticipates no 
adverse comments. However, in a separate document in this Federal 
Register publication, the EPA is proposing to approve the SIP revision 
should adverse or critical comments be filed. This action will be 
effective on March 24, 1997 unless, by February 21, 1997, adverse or 
critical comments are received.
    If the EPA receives such comments, this action will be withdrawn 
before the effective date by publishing a subsequent rulemaking that 
will withdraw the final action. All public comments received will be 
addressed in a subsequent final rule based on this action serving as a 
proposed rule. The EPA will not institute a second comment period on 
this action. Any parties interested in commenting on this action should 
do so at this time. If no such comments are received, the public is 
advised that this action will be effective on March 24, 1997.
    Nothing in this action should be construed as permitting, allowing 
or establishing a precedent for any future request for revision to any 
SIP. Each request for revision to the SIP shall be considered 
separately in light of specific technical, economic, and environmental 
factors and in relation to relevant statutory and regulatory 
requirements.

V. Administrative Requirements

A. Executive Order 12866

    This action has been classified as a Table 3 action for signature 
by the Regional Administrator under the procedures published in the 
Federal Register on January 19, 1989 (54 FR 2214-2225), as revised by a 
July 10, 1995, memorandum from Mary D. Nichols, Assistant Administrator 
for Air and Radiation. The Office of Management and Budget (OMB) has 
exempted this regulatory action from Executive Order 12866 review.

B. Regulatory Flexibility

    Under the Regulatory Flexibility Act, 5 U.S.C. section 600 et seq., 
EPA must prepare a regulatory flexibility analysis assessing the impact 
of any proposed or final rule on small entities. 5 U.S.C. sections 603 
and 604. Alternatively, EPA 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.
    SIP approvals under section 110 and subchapter I, part D of the Act 
do not create any new requirements, but simply approve requirements 
that the State is already imposing. Therefore, because the Federal SIP 
approval does not impose any new requirements, the Administrator 
certifies that it does not have a significant impact on any small 
entities affected. Moreover, due to the nature of the Federal-State 
relationship under the Act, preparation of a flexibility analysis would 
constitute Federal inquiry into the economic reasonableness of the 
State action. The Clean Air Act forbids EPA to base its actions 
concerning SIPs on such grounds. Union Electric Co. v. EPA., 427 U.S. 
246, 256-66 (1976); 42 U.S.C. 7410(a)(2).

C. Unfunded Mandates

    Under Section 202 of the Unfunded Mandates Reform Act of 1995, 
signed into law on March 22, 1995, EPA must undertake various actions 
in association with 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. This Federal action approves pre-existing requirements under 
state or local law, and imposes no new requirements. Accordingly, no 
additional costs to state, local, or tribal governments, or the private 
sector, result from this action.

D. Submission to Congress and the General Accounting Office

    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

[[Page 3220]]

not a major rule as defined by 5 U.S.C. 804(2).

E. Petitions for Judicial Review

    Under section 307(b)(1) of the Act, petitions for judicial review 
of this action must be filed in the United States Court of Appeals for 
the appropriate circuit by March 24, 1997. Filing a petition for 
reconsideration by the Administrator of this final rule does not affect 
the finality of this rule for the purposes of judicial review nor does 
it extend the time within which a petition for judicial review may be 
filed, and shall not postpone the effectiveness of such rule or action. 
This action may not be challenged later in proceedings to enforce its 
requirements. (See Section 307(b)(2)).

List of Subjects in 40 CFR Part 52

    Environmental protection, Air pollution control, Hydrocarbons, 
Incorporation by reference, Intergovernmental relations, Ozone, 
Reporting and recordkeeping requirements.

    Dated: December 24, 1996.
Valdas V. Adamkus,
Regional Administrator.
    For the reasons stated in the preamble, part 52, chapter I, title 
40 of the Code of Federal Regulations is amended as follows:

PART 52--[AMENDED]

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

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

    2. Section 52.770 is amended by adding paragraph (c)(113) to read 
as follows:


Sec. 52.770  Identification of plan.

* * * * *
    (c) * * *
    (113) On February 13, 1996, and June 27, 1996, Indiana submitted 
rules for the control of volatile organic compound emissions from 
shipbuilding and ship repair operations in Clark, Floyd, Lake, and 
Porter Counties as a revision to the State Implementation Plan.
    (i) Incorporation by reference. 326 Indiana Administrative Code 8-
12: Shipbuilding or Ship Repair operations in Clark, Floyd, Lake, and 
Porter Counties, Section 1: Applicability, Section 2: Exemptions, 
Section 3: Definitions, Section 4: Volatile organic compound emissions 
limiting requirements, Section 5: Compliance requirements, Section 6: 
Test methods and procedures, and Section 7: Record keeping, 
notification, and reporting requirements. Adopted by the Indiana Air 
Pollution Control Board September 6, 1995. Filed with the Secretary of 
State April 1, 1996. Published at Indiana Register, Volume 19, Number 
8, May 1, 1996. Effective May 1, 1996.

[FR Doc. 97-1425 Filed 1-21-97; 8:45 am]
BILLING CODE 6560-50-P