[Federal Register Volume 62, Number 56 (Monday, March 24, 1997)]
[Proposed Rules]
[Pages 13846-13849]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-7347]


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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[MO-024-1024; FRL-5800-6]


Approval and Promulgation of Implementation Plans; State of 
Missouri

AGENCY: Environmental Protection Agency (EPA).

ACTION: Proposed rule.

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SUMMARY: The EPA proposes to approve the State Implementation Plan 
(SIP) revision concerning Missouri Rule 10 CSR 10-2.330, submitted by 
the Missouri Department of Natural Resources (MDNR). This revision 
would set a summertime gasoline Reid Vapor Pressure (RVP) limit of 7.2 
pounds per square inch (psi), and 8.2 pounds per square inch for 
gasoline containing at least 9.0 percent by volume but not more than 
10.0 percent by volume ethanol, for gasoline distributed in Clay, 
Jackson, and Platte Counties as part of the state plan to maintain its 
clean air quality.

DATES: Comments must be received on or before April 23, 1997.

ADDRESSES: Comments may be mailed to Stan Walker, Environmental 
Protection Agency, Air Branch, 726 Minnesota Avenue, Kansas City, 
Kansas 66101.

FOR FURTHER INFORMATION CONTACT: Stan Walker at (913) 551-7494.

SUPPLEMENTARY INFORMATION:

I. Background

    The Clean Air Act (CAA, or the Act) requires states which have 
areas failing to meet the National Ambient Air Quality Standard (NAAQS) 
for ozone to develop SIPs with sufficient control measures to attain 
and maintain the standard. The EPA designated the Kansas City 
Metropolitan Area (KCMA) as an area failing to meet the NAAQS on March 
3, 1978. The area designated as nonattainment included five counties: 
Platte, Clay, and Jackson Counties in Missouri, and Johnson and 
Wyandotte Counties in Kansas. In spite of a series of SIP revisions, 
the area continued to experience violations of the ozone NAAQS 
throughout the 1980s. Each time violations occurred beyond an 
attainment date, the EPA notified the Governor and called for a 
revision to the Missouri SIP. In response to the last of these SIP 
calls, MDNR submitted a SIP revision which demonstrated attainment of 
the ozone NAAQS by December 31, 1987. Although the area experienced a 
number of violations in 1988, no

[[Page 13847]]

violations were experienced during the subsequent three-year period.
    In an effort to comply with the 1990 Amendments to the CAA, and to 
ensure continued attainment of the ozone NAAQS with an adequate margin 
of safety, the state submitted an ozone maintenance SIP for the 
Missouri portion of the KCMA on October 23, 1991. Accompanying the 
maintenance SIP were several new rules to control volatile organic 
compound (VOC) emissions from certain categories, the state's request 
to redesignate the KCMA as an attainment area with respect to the ozone 
NAAQS, and a commitment to implement certain contingency measures 
should the area exceed certain emission levels or experience additional 
violations. The EPA approved the maintenance SIP and redesignated the 
KCMA to attainment on June 23, 1992.
    During the three-year period following approval of the maintenance 
SIP, a number of exceedances of the ozone standard were recorded in the 
KCMA. As a result, the KCMA was once again in violation of the ozone 
NAAQS. The EPA notified the state of the violation on January 31, 1996, 
and requested that the contingency measures in the approved plan be 
implemented. Due to various problems associated with implementation of 
contingency measures in the approved contingency plan, the local 
community undertook an evaluation of substitute measures which could be 
implemented. After an extensive evaluation of available options, the 
Mid-America Regional Council (MARC), in conjunction with the Kansas 
City Air Quality Forum, recommended a package of measures to Kansas and 
Missouri. This recommendation contained a number of measures for 
implementation as contingency measures, including lower volatility 
gasoline. This notice and the accompanying technical support document 
(TSD) provide an analysis of the lower volatility gasoline portion of 
the package of substitute measures.

II. Regulatory Objective

    RVP is a measure of a fuel's volatility and thereby affects the 
rate at which gasoline evaporates and emits VOCs; RVP is directly 
proportional to the rate of evaporation. Consequently, the lower the 
RVP, the lower the rate of evaporation. Lowering the RVP in the summer 
months can offset the effect of summer temperature upon the volatility 
of gasoline, which, in turn, lowers emissions of VOCs. VOC is an 
important component in the production of ground level ozone in the hot 
summer months. Reduction of RVP will help the state's effort to attain 
and maintain compliance with the NAAQS for ozone.

III. State Submittal

    On January 29, 1997, MDNR submitted to EPA Region VII a request for 
authorization to regulate fuel volatility. This plan was submitted as 
part of a host of contingency measures necessary for the KCMA to 
maintain clean air quality. Included in the submittal was a letter from 
Roger D. Randolph, Director, MDNR, to William A. Spratlin, EPA Region 
VII Director, Air, RCRA, and Toxics Division, requesting authorization 
to implement a lower RVP requirement in the Kansas City area; Emergency 
Rule 10 CSR 10-2.330, Control of Gasoline Reid Vapor Pressure; Draft 
Permanent rule 10 CSR 10-2.330; a request for an exemption under 
Section 211(c)(4)(C) of the Clean Air Act; and a letter requesting the 
EPA to parellel process the rule to provide adequate time for gasoline 
facilities to prepare for the change in fuel volatility. The state will 
hold a public hearing on April 24, 1997.
    The EPA is parallel processing this SIP revision concurrently with 
the state's proposal and adoption procedures for amending its SIP. 
Parallel processing is being done pursuant to the December 19, 1996, 
request from the state.
    This revision is being proposed under a procedure called parallel 
processing, whereby the EPA proposes rulemaking action concurrently 
with the state's procedures for amending its regulations. If the 
proposed revision is substantially changed in areas other than those 
identified in this notice, the EPA will evaluate those changes and may 
publish another notice of proposed rulemaking. If no substantial 
changes are made other than those areas cited in this notice, the EPA 
will publish a final rulemaking notice on the revisions. The final 
rulemaking action by the EPA will occur only after the SIP revision has 
been adopted by Missouri and submitted formally to the EPA for 
incorporation into the SIP.

IV. Analysis of the SIP

A. Necessity Finding

    Under sections 211(c) and 211(h) of the CAA, the EPA has 
promulgated nationally applicable Federal standards for RVP levels in 
motor vehicle gasoline. Because a Federal control promulgated under 
section 211(c)(1) applies to the fuel characteristic RVP, nonidentical 
state controls are prohibited under section 211(c)(4). Section 
211(c)(4)(A) of the Act prohibits state regulation respecting a fuel 
characteristic or component for which the EPA has adopted a control or 
prohibition, unless the state control is identical to the Federal 
control. Under section 211(c)(4)(C), the EPA may approve a nonidentical 
state fuel control as a SIP provision, if the state demonstrates that 
the measure is necessary to achieve the national primary or secondary 
ambient air quality standard that the plan implements. The EPA can 
approve a state fuel requirement as necessary only if no other measures 
would bring about timely attainment, or if other measures exist but are 
unreasonable or impracticable. While the Missouri low RVP requirement 
is preempted by the Federal RVP requirements, the state can implement 
the low RVP requirement if the EPA finds it necessary and approves it 
as a revision to the SIP.
    In its submittal, Missouri showed that additional VOC reductions 
are needed to address Kansas City's recent history of nonattainment 
problems and to ensure continued attainment of the ozone NAAQS in the 
KCMA. While the area is designated as attainment for the ozone NAAQS, 
the KCMA is currently in danger of violating the standard due to 
exceedances occurring in the 1995-1996 period. Missouri estimates that 
the area needs to achieve approximately 8.5 tons per day of VOC 
reductions to continue to achieve attainment of the ozone NAAQS. 
Because emission trends continue to increase, the state believes it is 
important that control measures producing a significant portion of the 
needed reductions be implemented in time to reduce emissions beginning 
in the 1997 ozone season. Otherwise, there is a significant risk of 
exceedances and violations in 1997, and this risk will increase over 
time. The EPA agrees that an important criteria in evaluating the 
reasonableness of each control measure is whether it will achieve 
significant emission reductions in the near term, beginning in the 1997 
and 1998 ozone seasons.
    Missouri evaluated a broad range of available control measures to 
determine whether there are sufficient reasonable and practicable 
measures available to produce the needed emissions reductions without 
requiring low RVP gasoline. In addition to assessing the quantity of 
emission reductions attributable to each control measure, the state 
also considered the time needed for implementation and cost-
effectiveness of each measure in evaluating the reasonableness and 
practicability of the other control measures in comparison to low RVP 
gasoline requirements. The cost-effectiveness ratio is based on the 
cost expected to be incurred from 1997

[[Page 13848]]

through 2006, resulting from implementing the control measure, divided 
by the 10-year sum of the daily VOC reductions. Missouri found that a 
7.2 psi low RVP requirement could be implemented in time for the 1997 
ozone season, would produce an estimated 4.1 tons per day of VOC 
emissions reductions, and has an estimated cost-effectiveness ratio of 
1.1. The state also evaluated the following other measures: Stage II 
vapor recovery, reformulated gasoline, vehicle I/M programs, clean 
fueled fleets (CFF) program, light rail transit, free transit, and 
parking surcharge. Based on the state's evaluation, the EPA finds that 
there are not sufficient other reasonable and practicable measures 
available to produce the quantity of emissions reductions needed to 
continue to achieve the NAAQS, and thus a low RVP requirement is 
necessary.
    Missouri found that free transit on red sky-cast days can be 
implemented in time for the 1997 ozone season and has a very favorable 
cost-effectiveness ratio, but would generate only 0.3 tons per day 
reductions, which is a very small fraction of the goal of 8.5 tons per 
day total reductions. Free transit throughout the ozone season could be 
implemented on the same time frame, is less cost-effective, and would 
generate an additional 0.3 tons per day reductions. A parking surcharge 
could also be implemented promptly, but has a very high cost-
effectiveness ratio and would add only 0.6 tons per day reductions. 
Thus, even if the state were to implement all of these measures they 
would not produce a significant quantity of emissions reductions in the 
next few ozone seasons, and hence would not be sufficient to ensure 
that the state will continue to achieve the ozone NAAQS.
    While a number of other measures would achieve substantially 
greater reductions than free transit and a parking surcharge, the state 
found that all of these measures would take considerably longer to 
implement than low RVP, and none would produce emission reductions 
beginning in the 1997 and 1998 ozone seasons. One option the state 
considered is Stage II vapor recovery, which would reduce emissions an 
estimated 6.9 tons per day. However, Stage II would take approximately 
18 months to implement, which means it would not reduce emissions 
before the 1999 ozone season. Moreover, installation of the Stage II 
equipment would require additional underground piping as well as new 
hose and nozzle sets at each affected station. Stage II would require 
substantial compliance efforts by a larger number of entities than 
would a low RVP requirement, and it would mainly affect smaller 
entities, which may have more difficulty absorbing compliance costs.
    Another potential option is either a centralized or decentralized 
I/M program, with emissions reductions estimated ranging between 2.4 
tons per day (basic decentralized I/M) and 25 tons per day (the EPA 
recommended centralized enhanced I/M), depending upon the type of I/M 
program selected. Missouri estimated that an I/M program would take 
four to six years to fully implement and three to four years before 
producing any emissions reductions benefits. An I/M program would 
require legislative as well as regulatory action in both Missouri and 
Kansas. Additionally, an I/M program would require development of 
substantial infrastructure (e.g., testing facilities) in the Kansas 
City area, and would require participation by every motor vehicle 
owner.
    Missouri also considered light rail transit as a potential control 
measure, with estimated emissions reductions of 0.1 tons per day. The 
state considers light rail transit as an option only for the long term 
because it would require substantial lead time for implementation. Both 
Kansas and Missouri would have to pass authorizing legislation and 
secure funding sources. The states would also have to acquire land and 
undertake a large-scale construction project. Moreover, the state 
estimated that this option has a high cost-effectiveness ratio 
(compared to low RVP).
    Finally, Missouri has been working to develop a CFF program by 
forming a workgroup to help developed an intrastructure for the 
program. Currently this program is in the planning stages and could 
take approximately two to three years to implement. Since this program 
is in the planning stages, exact emission reduction credits have not 
yet been identified. The expected reductions from the CFF program would 
produce only a portion of the identified goal of 8.5 tons per day, 
leaving a need for additional significant reductions to continue to 
achieve attainment.
    Given that low RVP is the only option that would produce 
substantial emissions reductions in the near term, and given its 
comparative ease of implementation (as well as superior cost-
effectiveness to some of these options), the EPA finds that each of the 
measures discussed above is unreasonable in comparison to a low RVP 
requirement. This finding does not imply that these measures would be 
unreasonable if additional reductions were needed beyond those that 
would be produced by low RVP, or that these measures would be 
unreasonable given a longer time frame to reduce emissions. In addition 
to the measures discussed above, the state also evaluated opt into 
Federal RFG as another option. The EPA finds that opt-in to RFG is 
impracticable at this time because the area is a designated attainment 
area, and under current the EPA regulations, only designated 
nonattainment areas can opt in to RFG.

B. Emission Impact of the Fuel Volatility Control

    The fuel volatility control was identified by MARC as a control 
measure that could be implemented by the 1997 ozone season and will 
contribute significantly toward the established emission control. 
Reducing the fuel volatility limit from 7.8 to 7.2 psi will reduce VOC 
emissions by an expected 4.1 tons per day. Most of the emission 
reductions will occur from vehicle emissions (4.0 tons per day), and 
0.1 ton per day will come from nonroad emissions, including storage and 
refueling emission.

C. Economic Impacts of the Fuel Volatility Control

    The fuel volatility control will affect the cost of producing the 
gasoline. It is estimated that it will cost refineries an additional 
1.5 cents per gallon to produce 7.2 psi RVP gasolines. Some cost will 
be passed on to the consumer; therefore, consumers in the KCMA may 
experience a gasoline price increase of about 1.5 cents per gasoline.

V. Analysis of the Rule

    The Missouri rule specifies that no person shall dispense, supply, 
exchange in trade, offer for sale or supply, and sell or store gasoline 
used as a fuel for motor vehicles and that has an RVP greater than 7.2 
psi, or 8.2 psi for gasoline containing at least 9.0 percent by volume 
but not more than 10.0 percent by volume ethanol. This rule applies 
beginning June 1 through September 15 of each year.
    In addition, facilities other than a gasoline dispensing facility 
shall keep and maintain at the facility, for two years following the 
date of the RVP test, records of the information regarding the RVP of 
gasoline that is to be used as a fuel for motor vehicles.
    Gasoline used exclusively for fueling implements of agriculture and 
gasoline in any tank, reservoir, storage vessel, or other stationary 
container with a nominal capacity of 500 gallons or less are exempt 
from this regulation.
    The sampling procedures and test methods are consistent with the 
EPA

[[Page 13849]]

recommendations as described in 40 CFR Part 80, Appendices D, E, and F.

Proposed Action

    The EPA is proposing to approve this revision to the Missouri SIP 
concerning Missouri rule 10 CSR 10-2.330. At the state's request, the 
EPA is parallel processing this action.
    Nothing in this action should be construed as permitting or 
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.

VI. 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 Nichols, Assistant Administrator 
for Air and Radiation. The Office of Management and Budget (OMB) has 
exempted this regulatory action from E.O. 12866 review.

B. Regulatory Flexibility Act

    Under the Regulatory Flexibility Act, 5 U.S.C. 600 et seq., the EPA 
must prepare a regulatory flexibility analysis assessing the impact of 
any proposed or final rule on small entities (5 U.S.C. 603 and 604). 
Alternatively, the 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.
    This Federal action authorizes and approves into the Missouri SIP 
requirements previously adopted by the state, and imposes no new 
requirements. Therefore, 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 CAA, 
preparation of a regulatory flexibility analysis would constitute 
Federal inquiry into the economic reasonableness of state action. The 
CAA forbids the EPA to base its actions concerning SIPs on such grounds 
(Union Electric Co. v. U.S. E.P.A., 427 U.S. 246, 256-66 (S.Ct. 1976); 
42 U.S.C. 7410(a)(2)).

C. Unfunded Mandates

    Under section 202 of the Unfunded Mandates Reform Act of 1995 
signed into law on March 22, 1995, the 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, 
and tribal governments in the aggregate, or to the private sector, of 
$100 million or more in any one year. Under section 205, the 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 the EPA to establish a plan for 
informing and advising any small governments that may be significantly 
or uniquely impacted by the rule.
    The EPA has determined that the proposed action 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 authorizes and approves into 
the Kansas SIP requirements previously adopted by the state, and 
imposes no new requirements. Accordingly, no additional costs to State, 
local, or tribal governments, or to the private sector, result from 
this action.

List of Subjects in 40 CFR Part 52

    Environmental protection, Air pollution control, Carbon monoxide, 
Hydrocarbons, Incorporation by reference, Intergovernmental relations, 
Lead, Nitrogen dioxide, Ozone, Particulate matter, Reporting and 
recordkeeping requirements, Sulfur oxides, Volatile organic compounds.

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

    Dated: March 14, 1997.
William Rice,
Acting Regional Administrator.
[FR Doc. 97-7347 Filed 3-21-97; 8:45 am]
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