[Federal Register Volume 63, Number 22 (Tuesday, February 3, 1998)]
[Rules and Regulations]
[Pages 5460-5464]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-2616]


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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[WI75-01-7304; FRL-5958-7]


Approval and Promulgation of Implementation Plan; Wisconsin

AGENCY: Environmental Protection Agency.

ACTION: Final rule.

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SUMMARY: The United States Environmental Protection Agency (USEPA) 
proposed to approve Wisconsin's request to grant an exemption for the 
Milwaukee severe and Manitowoc County moderate ozone nonattainment 
areas from the applicable Oxides of Nitrogen (NOx) transportation 
conformity requirements on June 12, 1997. The proposal was based on 
information the Wisconsin Department of Natural Resource (WDNR) 
submitted to the EPA as a State Implementation Plan (SIP) revision 
request for an exemption under section 182(b)(1) of the Clean Air Act 
(Act). The request was based on the urban airshed modeling (UAM) 
conducted for the attainment demonstration for the Lake Michigan Ozone 
Study (LMOS) modeling domain. The EPA is temporarily granting this 
exemption until a control strategy SIP is approved.

DATES: This rule will be effective April 6, 1998.

ADDRESSES: Copies of the SIP revision, public comments and EPA's 
responses are available for inspection at the following address:
    Written comments should be sent to: Carlton T. Nash, Chief, 
Regulation Development Section, Air Programs Branch (AR-18J), USEPA, 
Region 5, 77 West Jackson Boulevard, Chicago, Illinois 60604-3590.

    A copy of this SIP revision is available for inspection at the 
following location:

    Office of Air and Radiation (OAR) Docket and Information Center 
(Air Docket 6102), room M1500, United States Environmental Protection 
Agency, 401 M Street SW., Washington, DC 20460, (202) 260-7548.

FOR FURTHER INFORMATION CONTACT: Michael G. Leslie, Regulation 
Development Section (AR-18J), Air Programs Branch, Air and Radiation 
Division, United States Environmental Protection Agency, Region 5, 77 
West Jackson Boulevard, Chicago, Illinois 60604, Telephone Number (312) 
353-6680.

SUPPLEMENTARY INFORMATION:

I. Background

    Clean Air Act section 176(c)(3)(A)(iii) requires, in order to 
demonstrate conformity with the applicable SIP, that transportation 
plans and Transportation Improvement Programs (TIPs) contribute to 
emissions reductions in ozone and carbon monoxide nonattainment areas 
during the period before control strategy SIPs are approved by USEPA. 
This requirement is implemented in 40 CFR 51.436 through 51.440 (and 
Sec. Sec. 93.122 through 93.124), which establishes the so-called 
``build/no-build test.'' This test requires a demonstration that the 
``Action'' scenario (representing the implementation of the proposed 
transportation plan/TIP) will result in lower motor vehicle emissions 
than the ``Baseline'' scenario (representing the implementation of the 
current transportation plan/TIP). In addition, the ``Action'' scenario 
must result in emissions lower than 1990 levels.
    The November 24, 1993, final transportation conformity rule 
1 does not require the build/no-build test and less-

[[Page 5461]]

than-1990 test for NOx as an ozone precursor in ozone nonattainment 
areas, where the Administrator determines that additional reductions of 
NOx would not contribute to attainment of the National Ambient Air 
Quality Standard (NAAQS) for ozone. Clean Air Act section 
176(c)(3)(A)(iii), which is the conformity provision requiring 
contributions to emission reductions before SIPs with emissions budgets 
can be approved, specifically references Clean Air Act section 
182(b)(1). That section requires submission of State plans that, among 
other things, provide for specific annual reductions of volatile 
organic compounds (VOCs) and NOx emissions ``as necessary'' to attain 
the ozone standard by the applicable attainment date. Section 182(b)(1) 
further states that its requirements do not apply in the case of NOx 
for those ozone nonattainment areas for which USEPA determines that 
additional reductions of NOx would not contribute to ozone attainment.
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    \1\ ``Criteria and Procedures for Determining Conformity to 
State or Federal Implementation Plans of Transportation Plans, 
Programs, and Projects Funded or Approved under Title 23 U.S.C. of 
the Federal Transit Act'' November 24, 1993 (58 FR 62188).
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    For ozone nonattainment areas, the process for submitting waiver 
requests and the criteria used to evaluate them are explained in the 
December 1993 USEPA document ``Guidelines for Determining the 
Applicability of Nitrogen Oxides Requirements Under Section 182(f),'' 
and the May 27, 1994, and February 8, 1995, memoranda from John S. 
Seitz, Director of the Office of Air Quality Planning and Standards, to 
Regional Air Division Directors, titled ``Section 182(f) NOx 
Exemptions--Revised Process and Criteria.''
    On July 13, 1994, the States of Illinois, Indiana, Michigan, and 
Wisconsin (the States) submitted to the USEPA a petition for an 
exemption from the requirements of section 182(f) of the Clean Air Act 
(Act). The States, acting through the Lake Michigan Air Directors 
Consortium (LADCo), petitioned for an exemption from the Reasonably 
Available Control Technology (RACT) and New Source Review (NSR) 
requirements for major stationary sources of NOx. The petition also 
asked for an exemption from the transportation and general conformity 
requirements for NOx in all ozone nonattainment areas in the Region.
    On March 6, 1995, the USEPA published a rulemaking proposing 
approval of the NOx exemption petition for the RACT, NSR and 
transportation and general conformity requirements. A number of 
comments were received on the proposal. Several commenters argued that 
NOx exemptions are provided for in two separate parts of the Act, in 
sections 182(b)(1) and 182(f), but that the Act's transportation 
conformity provisions in section 176(c)(3) explicitly reference section 
182(b)(1). In April 1995, the USEPA entered into an agreement to change 
the procedural mechanism through which a NOx exemption from 
transportation conformity would be granted (EDF et al. v. USEPA, No. 
94-1044, U.S. Court of Appeals, D.C. Circuit). Instead of a petition 
under section 182(f), transportation conformity NOx exemptions for 
ozone nonattainment areas that are subject to section 182(b)(1) now 
need to be submitted as a SIP revision request. The Milwaukee and the 
Manitowoc ozone nonattainment areas are classified as moderate or above 
and, thus, are subject to section 182(b)(1).
    The transportation conformity requirements are found at sections 
176(c)(2), (3), and (4). The conformity requirements apply on an 
areawide basis in all nonattainment and maintenance areas. The USEPA's 
transportation conformity rule was amended on August 29, 1995 (60 FR 
44762) to reference section 182(b)(1) rather than section 182(f) as the 
means for exempting areas subject to section 182(b)(1) from the 
transportation conformity NOx requirements.
    The July 10, 1996, SIP revision request from Wisconsin was 
submitted to meet the requirements in accordance with section 
182(b)(1). Public hearings on this SIP revision request were held on 
January 11 and 12, 1995.
    In evaluating the section 182(b) SIP revision request, the USEPA 
considered whether additional NOx reductions would contribute to 
attainment of the standard in Milwaukee severe and Manitowoc County 
moderate ozone nonattainment areas and also in the downwind areas of 
the LMOS modeling domain.
    As outlined in relevant USEPA guidance, the use of photochemical 
grid modeling is the recommended approach for testing the contribution 
of NOx emission reductions to attainment of the ozone standard. This 
approach simulates conditions over the modeling domain that may be 
expected at the attainment deadline for three emission reduction 
scenarios: (1) Substantial VOC reductions; (2) substantial NOx 
reductions; and (3) both VOC and NOx reductions. If the areawide 
predicted maximum one-hour ozone concentration for each day modeled 
under scenario (1) is less than or equal to those from scenarios (2) 
and (3) for the corresponding days, the test is passed and the section 
182(f) NOx emissions reduction requirements would not apply.
    In making this determination under section 182(b)(1) that the NOx 
requirements do not apply, or may be limited in the Lake Michigan area, 
the USEPA has considered the National study of ozone precursors 
completed pursuant to section 185B of the Act. The USEPA has based its 
decision on the demonstration and the supporting information provided 
in the SIP revision request.

II. Public Comments

    On June 12, 1997, the EPA proposed approval of the Wisconsin 
request to grant an exemption for the Milwaukee severe and Manitowoc 
County moderate ozone nonattainment areas from the applicable Oxides of 
Nitrogen (NOx) transportation conformity requirements. The EPA received 
five sets of comments during the public comment period which ended on 
July 14, 1997. Four of the comments where in favor of the EPA proposal, 
and one set was critical of the proposal.
    Comment: Wisconsin has failed to establish a NOx budget for these 
ozone nonattainment areas. Wisconsin has yet to develop and submit such 
budgets as required by November 1994. Until these attainment 
demonstrations, encompassing verifiable and allocated (biogenic, point, 
mobile, and area) NOx emission budgets, are submitted and complete, any 
determination that required control strategies are not necessary is 
premature and unfounded.
    Response: The EPA acknowledges that the State has not submitted the 
attainment demonstration as required, but EPA can process this SIP 
revision without an attainment demonstration. As described in the 
proposal, EPA is issuing this waiver on a temporary basis while more 
detail modeling information is being developed and submitted.
    Comment: The Wisconsin submittal failed to demonstrate that low-
level NOx reductions in the Milwaukee and Manitowoc nonattainment areas 
would not improve air quality. While the submittal did analyze domain-
wide low level NOx reductions, no such analysis was performed for the 
specific Wisconsin counties. The State of Wisconsin in coordination 
with LADCo, has the capabilities to model NOx emissions from mobile 
sources in these counties. The EPA should require such a demonstration 
before taking final action on this rulemaking.
    Response: The LADCo analysis demonstrated that across the board 
reductions in NOx from point, area, and mobile sources would not 
improve air quality in the modeling domain. Further, LADCo performed an 
analysis which focused on NOx reductions from point sources. This 
analysis showed a small increase in ozone formation. From

[[Page 5462]]

this result LADCo concluded that low level NOx controls, i.e. mobile 
and area sources, would be detrimental to air quality in the modeling 
domain. The EPA accepts these conclusions.
    Comment: The Wisconsin submittal failed to incorporate the LADCo 
``Episode 4'' analysis. This episode represents meteorological 
conditions with predominately east-to-west transport patterns. These 
types of episodes will be important when assessing the revised NAAQS 
eight hour exposure in Eastern Wisconsin. Areas such as Fox Valley and 
Dane County, Wisconsin have already recorded eight hour average ozone 
levels greater than 80 ppb.
    Response: The EPA disagrees that Episode 4 was not incorporated 
into Wisconsin's NOx waiver submittal. The August 22, 1994, EPA 
technical review and the LADCo July 13, 1994, technical support 
document for the NOx exemption modeling analysis clearly detail that 
Episode 4 is included in the NOx waiver submittal. This episode 
predicted that the highest domain-wide peak ozone concentrations occur 
under the NOx-only reduction case. The modeling demonstration also 
showed that NOx reductions are too limited to contribute to attainment 
of the ozone standard.
    Comment: Michigan Counties now in violation of the ozone NAAQS will 
benefit from low-level NOx emissions reductions.
    Response: Weather conditions which typically produce high levels of 
ozone in the western Michigan area feature winds generally from the 
south to southwest. NOx controls in Wisconsin have a minimal affect on 
air quality in western Michigan during these high ozone episodes. The 
LADCO modeling demonstrates that air quality benefits in western 
Michigan occur primarily as a result of NOx controls in Illinois and 
Indiana.
    Comment: The EPA has failed to adequately consider the benefits of 
NOx emissions reductions in the Milwaukee and Manitowoc nonattainment 
areas.
    Response: As stated above, the LADCo analysis demonstrated that 
across-the-board reductions in NOx from point, area, and mobile sources 
would not improve air quality in the modeling domain. Further, LADCo 
performed an analysis which focused on NOx reductions from point 
sources. This analysis showed a small increase in ozone formation. From 
this result LADCo concluded that low level NOx controls, i.e. mobile 
and area sources, would be detrimental to air quality in the modeling 
domain. The EPA accepts these conclusions.
    Comment: The EPA and Wisconsin failed to perform the appropriate 
environmental justice analysis. The EPA has failed to consider the 
spatial impact of where reductions could be anticipated and where 
increases might occur with and without NOx conformity requirements in 
Wisconsin.
    Response: As discussed in the July 14, 1997, proposed approval, the 
role that NOx emissions play in producing ozone at any given place and 
time is complex. NOx primarily represents a sum of two oxides of 
nitrogen, namely nitrogen oxide (NO) and nitrogen dioxide 
(NO2). In the presence of sunlight, NO2 photo-
dissociates into NO and a single oxygen atom. The oxygen atom reacts 
with molecular oxygen (O2) to form ozone (O3). 
NO, on the other hand, near its source area readily reacts with ozone 
to form O2 and NO2. The generated NO2 
is then free to photo-dissociate and lead to ozone formation further 
downwind. The reaction of NO with ozone, which locally reduces ozone 
concentrations, is referred to as ozone scavenging and is one of the 
primary local sinks for ozone in the lower atmosphere in and near NO 
source areas. Since emissions of NOx from fuel combustion sources, 
whether internal combustion engines or stationary combustion sources, 
such as industrial boilers, contain significant amounts of NO, it is 
expected that ozone concentrations immediately downwind of such NOx 
sources will be reduced through ozone scavenging. Therefore, reducing 
NOx emissions can lead to increased ozone concentrations in the 
vicinity of the controlled NOx emission sources, whereas reducing NOx 
emissions may lead to reduction in ozone concentrations further 
downwind. Reducing NOx emissions in VOC-limited areas (areas with low 
VOC emissions relative to NOx emissions) may produce minimal ozone 
reductions or even ozone increases. This pattern of NOx scavenging is 
demonstrated in the LADCo modeling. Therefore, controlling low level 
NOx in Milwaukee area could in fact increase ozone concentrations in 
local areas.
    Comment: The Wisconsin request utilizes the BEIS-I inventory for 
biogenics emissions. The Ozone Transport Assessment Group (OTAG) 
concluded that the BEIS-II inventory is the preferred inventory for UAM 
analyses.
    Response: The BEIS-I was the approved and most appropriate biogenic 
emissions inventory available to LADCo when the NOx model analysis was 
performed. Any subsequent modeling performed by LADCo will utilize the 
BEIS-II biogenic emissions inventory.
    Comment: OTAG concluded, with Wisconsin's concurrence, that both 
elevated and low level NOx reductions are effective in reducing ozone 
levels. These conclusions were based extensively on OTAG modeling, and 
are significant and relevant to EPA's action on this rule. The modeling 
clearly demonstrated the efficacy of reducing low-level (mobile source) 
NOx in controlling ozone. The conclusions of the policy group were that 
such reductions were cost effective, and beneficial to reduce transport 
to downwind areas.
    Response: While EPA agrees in a general sense that OTAG recommended 
NOx reductions from all source categories will reduce the transport of 
ozone, it should be noted that OTAG concluded that States must have the 
opportunity to conduct additional local and subregional modeling to 
assess appropriateness, type, and timing of controls. OTAG further 
concludes that States can work together, in coordination with EPA, 
toward completing local SIPs including an evaluation of possible local 
NOx disbenefits. The EPA believes that the specific modeling done by 
LADCo should override OTAG's general findings as it pertains to NOx 
disbenefits.
    Comment: The OTAG concluded that ``disbenefit'' analyses found 
ozone increases to be less frequent and severe than EPA concluded based 
on the July 13, 1994, LADCo section 182(f) NOx waiver submittal, on 
which the Wisconsin transportation conformity waiver is based.
    Response: The OTAG-fine grid analysis utilized a 12 km grid as 
compared to the LADCo fine grid of 4 km. This disparity in fine-grid 
size de-emphasizes the NOx disbenefit at the local urbanized area. OTAG 
concluded that some areas will experience local NOx disbenefits at more 
frequent pronounced levels. The EPA believes that the LADCO fine-grid 
analysis is more relevant than the waiver determination.
    Comment: In previous rulemakings on similar NOx waiver requests, 
EPA committed to incorporate the OTAG findings in ``future'' EPA 
rulemakings. The OTAG has completed its analyses, and the EPA proposed 
approval of Wisconsin's section 182(b) waiver is in direct conflict 
with the OTAG's findings and EPA's commitment to utilize those 
findings.
    Response: The summary of the OTAG finding states that NOx 
reductions decrease and increase ozone; decreases occur domain wide, 
increases are confined to a few days in a few urban

[[Page 5463]]

areas. These local increases are due mostly to low level urban NOx 
reductions. These findings are consistent with the LADCo analysis for 
this waiver.
    The EPA's recently signed proposed regional NOx rulemaking uses the 
OTAG findings to identify States which contribute significantly to 
ozone problem areas in other States. In addition, the proposed 
rulemaking establishes State-wide NOx budgets for the year 2007.
    A section of the rulemaking also solicits comments on approaches 
that can be used to address the disbenefit issue in areas such as Lake 
Michigan. Subsequent modeling by the LADCo States will need to address 
the disbenefit issue as it pertains to the NOx budget, ozone transport, 
and attainment.

III. EPA Action

    In this final action, EPA is approving the transportation 
conformity NOx waiver SIP revision for the State of Wisconsin. In light 
of the modeling completed thus far and considering the importance of 
the Ozone Transport Assessment Group (OTAG) process and attainment plan 
modeling efforts, EPA notes that it may reexamine the impact of this 
NOx waiver. In the near future, EPA intends to require appropriate 
States to submit SIP measures to achieve emissions reductions of ozone 
precursors needed to prevent significant transport of ozone. The EPA 
will evaluate Wisconsin's submitted SIP measures and available refined 
modeling to determine whether the NOx waiver should remain in place, or 
whether EPA will require a new plan revision.
    The EPA also reserves the right to require NOx emission controls 
for transportation sources under section 110(a)(2)(D) of the Act if 
future ozone modeling demonstrates that such controls are needed to 
achieve the ozone standard in downwind areas.

IV. Miscellaneous

A. Applicability to Future SIP Decisions

    Nothing in this action should be construed as permitting, allowing 
or establishing a precedent for any future request for revision to any 
SIP. The EPA shall consider each request for revision to the SIP in 
light of specific technical, economic, and environmental factors and in 
relation to relevant statutory and regulatory requirements.

B. Executive Order (E.O.) 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 has exempted 
this regulatory action from E.O. 12866 review.

C. Regulatory Flexibility

    Under the Regulatory Flexibility Act, 5 U.S.C. 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. 603 and 604). 
Alternatively, EPA may certify that the rule will not have a 
significant economic 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 state 
action. The Act forbids EPA to base its actions concerning SIPs on such 
grounds. Union Electric Co. v. EPA, 427 U.S. 246, 255-66 (1976); 42 
U.S.C. 7410(a)(2).

D. Unfunded Mandates Reform Act

    Under section 202 of the Unfunded Mandates Reform Act of 1995 
(``Unfunded Mandates Act''), 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 of $100 million or more to State, local, or tribal governments in 
the aggregate; or to the private sector, of $100 million or more. 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 approval action promulgated 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 
preexisting requirements under state or local law, and imposes no new 
requirements. Accordingly, no additional costs to state, local, or 
tribal governments, or to the private sector, result from this action.

E. 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, the 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 this rule in the 
Federal Register. This rule is not a ``major rule'' as defined by 5 
U.S.C. 804(2)

F. 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 April 6, 1998. 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, 
Intergovernmental relations, Ozone, Oxides of Nitrogen, Transportation 
conformity, Transportation-air quality planning, Volatile organic 
compounds.

    Dated: January 22, 1998.
David A. Ullrich,
Acting Regional Administrator, Region V.

    40 CFR part 52 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 et seq.

Subpart YY--Wisconsin

    2. Section 52.2585 is amended by adding paragraph (m) to read as 
follows:


Sec. 52.2585  Control strategy: Ozone.

    * * * * *

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    (m) Approval--On July 10, 1996, the Wisconsin Department of Natural 
Resources submitted a revision to the ozone State Implementation Plan. 
The submittal pertained to a request to waive the Oxide of Nitrogen 
requirements for transportation conformity in the Milwaukee and 
Manitowoc ozone nonattainment areas.
[FR Doc. 98-2616 Filed 2-2-98; 8:45 am]
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