[Federal Register Volume 63, Number 55 (Monday, March 23, 1998)]
[Rules and Regulations]
[Pages 13795-13798]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-7305]


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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[VA025-5033; FRL-5977-9]


Approval and Promulgation of Air Quality Implementation Plans; 
Commonwealth of Virginia--Prevention of Significant Deterioration 
Program

AGENCY: Environmental Protection Agency (EPA).

ACTION: Final rule.

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SUMMARY: EPA is approving a revision to the Commonwealth of Virginia's 
State Implementation Plan (SIP) under which the Commonwealth will be 
implementing the Prevention of Significant Deterioration of Air Quality 
program (PSD program) pursuant to its own SIP regulations. The 
Commonwealth had been implementing the PSD program under the terms of 
an EPA delegation to the Commonwealth of the authority to implement the 
Federal PSD regulations. Under the PSD program those constructing new 
major sources of a criteria air pollutant in areas that are attainment 
for the National Ambient Air Quality Standards (NAAQS) set for that 
pollutant, or constructing major modifications to such sources in such 
areas, must demonstrate that emissions from those sources will not 
cause violations of the NAAQS, or significantly deteriorate air quality 
beyond specified ambient increments, and that the emissions will be 
controlled by Best Available Control Technology (BACT). Additional 
provisions relevant to Class I areas may also apply.

EFFECTIVE DATE: This final rule is effective on April 22, 1998.

ADDRESSES: Copies of the documents relevant to this action are 
available for public inspection during normal business hours at the Air 
Protection Division, U.S. Environmental Protection Agency, Region III, 
841 Chestnut Building, Philadelphia, Pennsylvania 19107; the Air and 
Radiation Docket and Information Center, U.S. Environmental Protection 
Agency, 401 M Street, SW., Washington, DC 20460; and the Virginia 
Department of Environmental Quality, 629 East Main Street, Richmond, 
Virginia, 23219.

FOR FURTHER INFORMATION CONTACT: Ray Chalmers, U.S. EPA Region III, Air 
Protection Division, Permits & Technology Assessment Section (3AP11), 
841 Chestnut Building, Philadelphia, PA. Phone: (215) 566-2061. 
Internet: ``Chalmers.R[email protected]''.

SUPPLEMENTARY INFORMATION:

I. Background

    In a series of submittals, the Virginia Department of Air Pollution 
Control (DAPC), now known as the Department of Environmental Quality 
(VDEQ), submitted the elements for a revision to its State 
Implementation Plan (SIP) that would establish a program for the 
prevention of significant deterioration of air quality (PSD) for the 
review and permitting of new major sources and major modifications (the 
PSD program). On January 24, 1996, EPA proposed to disapprove or, in 
the alternative, to conditionally approve Virginia's PSD SIP revision. 
(61 FR 1880). EPA proposed disapproval because, in the agency's view, 
the Commonwealth's limitation of access to state judicial appeal (also 
known as standing) of permitting actions was inconsistent with the 
agency's interpretation that existing law and regulations require an 
opportunity for state judicial review under approved PSD SIPs by permit 
applicants and affected members of the public. In EPA's proposed rule, 
comment was solicited on the agency's view that a limited judicial 
review did not meet the minimum requirements for standing required for 
PSD SIP programs under the Clean Air Act (CAA) and EPA`s implementing 
regulations.
    Alternatively, if the agency determined after reviewing public 
comment that provisions for judicial standing were unnecessary, EPA 
proposed to conditionally approve Virginia's PSD SIP. EPA determined 
that Virginia was still required to amend the Commonwealth's PSD 
regulations that existed at the time of the proposed rule to include 
revised increments for particulate matter (PM) as promulgated by EPA on 
June 3, 1993, and EPA's revised ``Guidelines for Air Quality Models'', 
promulgated on July 20, 1993. More detailed information on EPA's 
proposed rulemaking actions and an analysis of Virginia's PSD 
regulations can be found in the proposed rule published on January 24, 
1996 (61 FR 1880) and the Technical Support Document for the proposed 
rule.

II. Analysis

    Subsequent to the publication of EPA's proposed rule on Virginia's 
PSD program, the deficiencies noted above were corrected. Regarding 
judicial standing in Virginia, EPA published a December 5, 1994, final 
rule in which EPA disapproved Virginia's Title V operating permits 
program for, among other things, the failure to provide adequate 
judicial standing. (59 FR 62324). Virginia appealed this decision 
before the Fourth Circuit Court of Appeals, which affirmed EPA's 
disapproval, 80 F.3d 869 (1996), and Virginia subsequently appealed its 
case to the U.S. Supreme Court. On January 21, 1997, the Supreme Court 
decided not to hear Virginia's case. In preparation for this 
eventuality, Virginia had previously adopted revised and acceptable 
judicial standing provisions, at sections 10.1-1318, 10.1-1457, and 
62.1-44.29 of the Code of Virginia, but specified that the revised 
provisions would become effective only if Virginia's suit against EPA 
was unsuccessful. The Supreme Court's refusal to take Virginia's appeal 
has caused Virginia's revised judicial standing provisions to become 
effective, and Virginia's standing provisions are now fully acceptable. 
Virginia's revised standing law now provides judicial standing to any 
person who ``meets the standard for judicial review of a case or 
controversy pursuant to Article III of the United States 
Constitution.'' It further provides that ``a person shall be deemed to 
meet such standard if: (i) Such person has suffered an actual or 
imminent injury which is an invasion of a legally protected interest 
and which is concrete and particularized; (ii) such injury is fairly 
traceable to the decision of the Board and not the result of the 
independent action of some third party not before the court; and (iii) 
such injury will likely be redressed by a favorable decision by the 
court.'' This new standard is consistent with the standard for Article 
III standing articulated by the Supreme Court in Lujan v. Defenders of 
Wildlife, 112 S. Ct. 2130 (1992). Consequently, EPA has determined that 
Virginia's standing provisions meet the requirements of the CAA and 40 
CFR 51.166.
    On February 6, 1997 Virginia submitted to EPA an Attorney General's 
Opinion affirming that the revised standing law would go into effect on

[[Page 13796]]

February 15, 1997. This action on the part of the Commonwealth corrects 
any deficiency in standing that might have been determined by EPA as a 
result of reviewing public comment on this issue. The Commonwealth also 
submitted revised regulations on March 20, 1997 that corrected the 
deficiencies identified with the proposed conditional approval. Since 
the deficiencies identified in EPA's proposed rule no longer exist, EPA 
is taking action to fully approve Virginia's PSD program as a SIP 
revision.
    After making its original PSD submittal to EPA on December 17, 
1992, in 1995 Virginia adopted legislation that provides, subject to 
certain conditions, for an environmental assessment (audit) 
``privilege'' for voluntary compliance evaluations performed by a 
regulated entity. The legislation further addresses the relative burden 
of proof for parties either asserting the privilege or seeking 
disclosure of documents for which the privilege is claimed. Virginia's 
legislation also provides, subject to certain conditions, for a penalty 
waiver for violations of environmental laws when a regulated entity 
discovers such violations pursuant to a voluntary compliance evaluation 
and voluntarily discloses such violations to the Commonwealth and takes 
prompt and appropriate measures to remedy the violations. Virginia's 
Voluntary Environmental Assessment Privilege law, Va. Code Sec. 10.1-
1198, provides a privilege that protects from disclosure documents and 
information about the content of those documents that are the product 
of a voluntary environmental assessment. The privilege does not extend 
to documents or information that are: (1) Generated or developed before 
the commencement of a voluntary environmental assessment; (2) that are 
prepared independently of the assessment process; (3) that demonstrate 
a clear, imminent and substantial danger to the public health or 
environment; or (4) that are required by law.
    On December 29, 1997, the Office of the Attorney General provided a 
legal opinion that states, with regard to the Privilege law, that the 
Commonwealth is ``required by Federal law to have full authority to 
enforce'' the PSD program, ``both civilly and criminally,'' therefore, 
``all aspects of Virginia's environmental laws and regulations that are 
necessary to implement and enforce its PSD program in a manner that is 
no less stringent than its Federal counterpart are necessarily 
``required by law.'' Thus, ``[r]egarding Sec. 10.1-1198, documents or 
information needed for civil or criminal enforcement under the PSD 
program could not be privileged * * *''
    Virginia's Immunity law, Va. Code Sec. 10.1-1199, provides that 
``[t]o the extent consistent with requirements imposed by Federal 
law,'' any person making a voluntary disclosure of information to a 
state agency regarding a violation of an environmental statute, 
regulation, permit, or administrative order is granted immunity from 
administrative or civil penalty. The Attorney General's December 29, 
1997 opinion states that the quoted language renders this statute 
inapplicable to PSD enforcement.
    Thus, EPA has determined that Virginia's Privilege and Immunity 
legislation will not preclude the Commonwealth from enforcing its PSD 
program consistent with the CAA's requirements.

III. Response to Comments

    EPA received comments supporting EPA's proposed disapproval of the 
Commonwealth's PSD SIP from environmental, public interest, and legal 
action organizations, and from private citizens. Each of these groups 
and citizens stressed that EPA should not approve Virginia's PSD SIP 
because Virginia had not provided all interested and qualified parties 
with the legal standing to challenge PSD permitting actions in State 
courts or through administrative appeal. EPA also received adverse 
comment related to the proposed disapproval from the Commonwealth of 
Virginia and several groups representing business and industrial 
sources. The latter alternatively indicated their support of the 
proposed conditional approval.
    Although EPA solicited comment on whether or not legal standing 
should be grounds for disapproving Virginia's PSD program, Virginia's 
adoption of revised standing provisions, as noted above, eliminates the 
need to consider this issue prior to taking a final rulemaking action 
on the PSD SIP. Therefore, EPA is not commenting or otherwise 
announcing a decision on this matter at this time.
    One environmental group commented in favor of EPA's disapproval of 
the Commonwealth's PSD SIP because it believed that the Commonwealth's 
Air Board was ``* * * unprepared to assume responsibility for 
implementation of the state's PSD program in the absence of a large EPA 
presence * * *'' 40 CFR part 51 and section 110 of the Clean Air Act 
establish criteria by which EPA is to evaluate and approve a State 
Implementation Plan. EPA has determined that the Commonwealth has met 
the requirements of section 110 and 40 CFR part 51 and has the 
resources and necessary authority to carry out a PSD program. In fact, 
the Commonwealth has been implementing the Federal PSD program since 
1981 under an EPA delegation of authority. Should EPA identify 
deficiencies in the Commonwealth's PSD program whereby the Commonwealth 
can no longer demonstrate that its program meets the criteria 
established under section 110 of the Clean Air Act and the regulations 
in part 51, EPA has the authority to withdraw its approval.
    In addition, while EPA is approving the Commonwealth's PSD SIP, EPA 
recognizes that it has a responsibility to insure that all States 
properly implement their preconstruction permitting programs. EPA's 
approval of the Commonwealth's PSD program does not divest the Agency 
of the duty to continue appropriate oversight to insure that PSD 
determinations made by Virginia are consistent with the requirements of 
the CAA, EPA regulations, and the SIP. EPA's authority to oversee PSD 
program implementation is set forth in sections 113, 167, and 505(b) of 
the Act. For example, section 167 provides that EPA shall issue 
administrative orders, initiate civil actions, or take whatever other 
enforcement action may be necessary to prevent construction of a major 
stationary source that does not ``conform to the requirements of'' the 
PSD program. Similarly, section 113(a)(5) provides for administrative 
orders and civil actions whenever EPA finds that a State ``is not 
acting in compliance with'' any requirement or prohibition of the Act 
regarding construction of new or modified sources. Likewise, section 
113(a)(1) provides for a range of enforcement remedies whenever EPA 
finds that a person is in violation of an applicable implementation 
plan.
    Enactment of Title V of the CAA and the EPA objection opportunity 
provided therein has added new tools for addressing deficient new 
source review decisions by states. Section 505(b) requires EPA to 
object to the issuance of a permit issued pursuant to Title V whenever 
the Administrator finds during the applicable review period, either on 
her own initiative or in response to a citizen petition, that the 
permit is ``not in compliance with the requirements of an applicable 
requirement of this Act, including the requirements of an applicable 
implementation plan.''
    Regardless of whether EPA addresses deficient permits using 
objection authorities or enforcement authorities or

[[Page 13797]]

both, EPA cannot intervene unless the state decision fails to comply 
with applicable requirements. Thus, EPA may not intrude upon the 
significant discretion granted to states under new source review 
programs, and will not ``second guess'' state decisions. Rather, in 
determining whether a Title V permit incorporating PSD provisions calls 
for EPA objection under section 505(b) or use of enforcement 
authorities under sections 113 and 167, EPA will consider whether the 
applicable substantive and procedural requirements for public review 
and development of supporting documentation were followed. In 
particular, EPA will review the process followed by the permitting 
authority in determining best available control technology, assessing 
air quality impacts, meeting Class I area requirements, and other PSD 
requirements, to ensure that the required SIP procedures (including 
public participation and Federal Land Manager consultation 
opportunities) were met. EPA will also review whether any determination 
by the permitting authority was made on reasonable grounds properly 
supported on the record, described in enforceable terms, and consistent 
with all applicable requirements. Finally, EPA will review whether the 
terms of the PSD permit were properly incorporated into the operating 
permit.

IV. Today's Action

    EPA is approving a SIP revision submitted by the Commonwealth of 
Virginia establishing a preconstruction permitting program for the 
prevention of significant deterioration as required by section 110 of 
the Clean Air Act. EPA is amending 40 CFR 52.2420 to incorporate this 
revision into Virginia's SIP. At the same time, EPA is withdrawing from 
Virginia's SIP the Federal PSD requirements which EPA incorporated into 
Virginia's SIP on August 7, 1980, and is withdrawing the Commonwealth's 
authority to implement these Federal PSD program requirements, an 
authority which EPA delegated to the Commonwealth on June 3, 1981. 
Accordingly, after the effective date of this final rule the 
Commonwealth will issue PSD permits under the authority of its SIP-
approved program. The PSD permits which the Commonwealth issued prior 
to this rule under its delegated authority to implement the Federal PSD 
requirements continue in effect.
    Nothing in this action should be construed as permitting or 
allowing or establishing a precedent for any future request for 
revision to any state implementation plan. Each request for revision to 
the state implementation plan 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

    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., 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 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 
Clean Air 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, EPA 
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 flexibility analysis would 
constitute Federal inquiry into the economic reasonableness of state 
action. The Clean Air Act forbids EPA to base its actions concerning 
SIPs on such grounds. Union Electric Co. v. U.S. EPA, 427 U.S. 246, 
255-66 (1976); 42 U.S.C. 7410(a)(2).

C. Unfunded Mandates

    Under section 202 of the Unfunded Mandates Reform Act of 1995 
(``Unfunded Mandates Act''), 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 
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 the approval action being 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 
pre-existing 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.

D. Submission to Congress and the General Accounting Office

    Under section 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).

E. Petitions for Judicial Review

    Under section 307(b)(1) of the Clean Air Act, petitions for 
judicial review of this action approving the Commonwealth of Virginias 
PSD SIP must be filed in the United States Court of Appeals for the 
appropriate circuit by May 22, 1998. Filing a petition for 
reconsideration by the Administrator of this final rule approving the 
Commonwealth of Virginia's PSD SIP 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 
approving the Commonwealth of Virginia's PSD SIP 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, Carbon monoxide, 
Incorporation by reference, Intergovernmental relations, Nitrogen 
dioxide, Ozone, Particulate matter, Sulfur oxides.

    Dated: February 27, 1998.
Thomas C. Voltaggio,
Acting Regional Administrator, Region III.

    Chapter I, title 40, of the Code of Federal Regulations is amended 
as follows:

[[Page 13798]]

PART 52--[AMENDED]

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

    Authority: 42 U.S.C. 7401 et seq.

Subpart VV--Virginia

    2. Section 52.2420 is amended by adding paragraph (c)(123) to read 
as follows:


Sec.  52.2420   Identification of plan.

* * * * *
    (c) * * *
    (123) Revisions to the Virginia Regulations for the Prevention of 
Significant Deterioration submitted on March 20, 1997 by the Department 
of Environmental Quality:
    (i) Incorporation by reference.
    (A) Letter of March 20, 1997 from the Department of Environmental 
Quality transmitting a SIP revision for regulations for the Prevention 
Significant Deterioration.
    (B) Letter of February 18, 1993 from the Department of Air 
Pollution Control transmitting a SIP revision for regulations defining 
the prevention of significant deterioration areas.
    (C) Letter of January 13, 1998 from the Depart of Environmental 
Quality transmitting a SIP revisions to the Virginia Administrative 
Code numbering system.
    (D) The following provisions of the Virginia Regulations for the 
Control and Abatement of Air Pollution:
    (1) Regulations for Permits for Major Stationary Sources and Major 
Modifications Locating in Prevention of Significant Deterioration 
Areas, 9 VAC 5-80-1700 through 9 VAC 5-80-1970, published in the 
Virginia Register of Regulations on November 25, 1996, effective 
January 1, 1997.
    (2) Appendix L to VR 120-01, renumbered as 9 VAC 5-20-205, 
Prevention of Significant Deterioration Areas, published in the 
Virginia Register of Regulations on December 2, 1991, effective January 
1, 1992.
    (ii) Additional material.
    (A) Remainder of March 20, 1997 State submittal.
    3. Section 52.2451 is revised to read as follows:


Sec. 52.2451   Significant deterioration of air quality.

    (a) The requirements of sections 160 through 165 of the Clean Air 
Act are met since the plan includes approvable procedures for the 
Prevention of Significant Air Quality Deterioration.
    (b) Regulations for preventing significant deterioration of air 
quality. The provisions of Sec. 52.21(b) through (w) are hereby removed 
from the applicable state plan for the Commonwealth of Virginia.

[FR Doc. 98-7305 Filed 3-20-98; 8:45 am]
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