[Federal Register Volume 64, Number 26 (Tuesday, February 9, 1999)]
[Rules and Regulations]
[Pages 6231-6234]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-2981]


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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[CO-001-0019a; FRL-6216-6]


Approval and Promulgation of Air Quality Implementation Plans; 
Colorado; Revision to Regulation No. 7, Section III, General 
Requirements for Storage and Transfer of Volatile Organic Compounds

AGENCY: Environmental Protection Agency (EPA).

ACTION: Direct final rule.

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SUMMARY: EPA is approving the revision to the Colorado State 
Implementation Plan (SIP) as submitted by the Governor on April 22, 
1996. The revision consists of the addition of paragraph C to section 
III, ``General Requirements for Storage and Transfer of Volatile 
Organic Compounds,'' of Regulation No. 7, ``Regulation To Control 
Emissions of Volatile Organic Compounds.'' This new paragraph C to 
section III exempts beer production and associated beer container 
storage and transfer operations involving volatile organic compounds 
(VOC) with a true vapor pressure of less than 1.5 pounds per square 
inch atmosphere (psia), at actual conditions, from the submerged or 
bottom-fill requirements of section III. B. EPA's approval will serve 
to make this revision federally enforceable and was requested by the 
Governor.

DATES: This direct final rule is effective on April 12, 1999 without 
further notice, unless EPA receives adverse comment by March 11, 1999. 
If adverse comment is received, EPA will publish a timely withdrawal of 
the direct final rule in the Federal Register and inform the public 
that the rule will not take effect.

ADDRESSES: Written comments may be mailed to: Richard R. Long, 
Director, Air and Radiation Program (8P-AR), United States 
Environmental Protection Agency, Region VIII, 999 18th Street, Suite 
500, Denver, Colorado 80202-2466.
    Copies of the documents relevant to this action are available for 
public inspection during normal business hours at the following office: 
United States Environmental Protection Agency, Region VIII, Air and 
Radiation Program, 999 18th Street, Suite 500, Denver, Colorado 80202-
2466; and, the Air and Radiation Docket and Information Center, United 
States Environmental Protection Agency, 401 M Street, SW, Washington, 
DC 20460.
    Copies of the State documents relevant to this action are available 
for public inspection at the Colorado Department of Public Health and 
Environment, Air Pollution Control Division, 4300 Cherry Creek Drive 
South, Denver, Colorado 80246-1530.

FOR FURTHER INFORMATION CONTACT: Tim Russ, Air and Radiation Program 
(8P-AR), United States Environmental Protection Agency, Region VIII, 
999 18th Street, Suite 500, Denver, Colorado 80202-2466 Telephone 
number: (303) 312-6479.

SUPPLEMENTARY INFORMATION:

I. Background to the Action

A. Brief History on the Development of Colorado's Regulation No. 7 
(Reg. 7)

    On March 3, 1978, EPA designated the Denver-Boulder metropolitan 
area as nonattainment for the National Ambient Air Quality Standards 
(NAAQS) for ozone (43 FR 8976). This designation was reaffirmed by EPA 
on November 6, 1991 (56 FR 56694) pursuant to section 107(d)(1) of the 
CAA, as amended in 1990. Furthermore, since the Denver-Boulder area had 
not shown a violation of the ozone standard during the three-year 
period from January 1, 1987 to December 31, 1989, the Denver-Boulder 
area was classified as a ``transitional'' ozone nonattainment area 
under section 185A of the amended Act.
    The current Colorado Ozone SIP was approved by EPA in the Federal 
Register on December 12, 1983 (48 FR 55284). The SIP contains Reg. 7 
which applies RACT to stationary sources of VOCs. Reg. 7 was adopted to 
meet the requirements of Section 172(b)(2) and (3) of the 1977 CAA 
(concerning the application of RACT to stationary sources 
1.)
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    \1\ The requirement to apply RACT to existing stationary sources 
in a nonattainment area was carried forth under the amended Act in 
section 172(c)(1).
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    During 1987 and 1988, EPA Region VIII conducted a review of Reg. 7 
for consistency with the Control Techniques Guidelines documents (CTGs) 
and regulatory guidance, for enforceability and for clarity. The CTGs, 
which are guidance documents issued by EPA, set forth measures that are 
presumptively RACT for specific categories of sources of VOCs. A 
substantial number of deficiencies were identified in Reg. 7. In 1987, 
EPA published a proposed policy document that included, among other 
things, an interpretation of the RACT requirements as they applied to 
VOC nonattainment areas (see 52 FR 45044, November 24, 1987). On May 
25, 1988, EPA published a guidance document entitled ``Issues Relating 
to VOC Regulation Cutpoints, Deficiencies, and Deviations, 
Clarification to Appendix D of the November 24, 1987 Federal Register 
Notice'' (the ``Blue Book''). A review of Reg. 7 against these 
documents uncovered additional deficiencies in the regulation.
    By a letter dated September 27, 1989, the Governor submitted 
revisions to Reg. 7 that partially addressed EPA's concerns. By a 
letter dated August 30, 1990, the Governor submitted additional 
revisions to Reg. 7 that addressed EPA's remaining concerns with the 
September 27, 1989, SIP revision.
    On May 30, 1995, EPA published a final rule in the Federal Register 
(60 FR 28055) that fully approved the Governor's September 27, 1989, 
and August 30, 1990, revisions to Reg. 7. The final rule became 
effective on June 29, 1995.

B. Background Material Regarding the New Exemption to Section III 
``General Requirements for Storage and Transfer of Volatile Organic 
Compounds'' of Reg. 7

    Section III of Reg. 7 contains the following language in paragraph 
III. B which relates to the transfer of VOCs: ``Except as otherwise 
provided in this regulation, all volatile organic compounds transferred 
to any tank, container, or vehicle compartment with a capacity 
exceeding 212 liters (56 gallons), shall be transferred using submerged 
or bottom filling equipment. For top loading, the fill tube shall reach 
within six inches of the bottom of the tank compartment. For bottom-
fill operations, the inlet shall be flush with the tank bottom.''
    In June of 1994, the Colorado Association of Commerce and Industry 
(CACI) sought an exemption to the section III. B submerged/bottom-fill 
requirements of Reg. 7. One of CACI's members, Coors Brewing Company of

[[Page 6232]]

Golden, Colorado (Coors), had determined that it had several tanks and 
process vessels of greater than 56 gallons capacity to which it 
transferred VOCs without using submerged or bottom filling equipment. 
The VOC 2 in this case was mostly ethanol. CACI's original 
proposed SIP revision to section III of Reg. 7 was determined by both 
the Colorado Air Pollution Control Division (APCD) and EPA to be overly 
broad. On March 1, 1995, the APCD proposed an alternative SIP revision, 
narrowing the scope of the revision to only apply to beer production 
and associated beer container storage and transfer operations involving 
VOCs with a true vapor pressure of less than 1.5 psia.
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    \2\ EPA's definition of a VOC is found in 40 CFR 51.100(s) and 
was most recently amended on April 9, 1998 (63 FR 17331).
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    The purpose of CACI's request for the SIP revision was described in 
their hearing statement that was provided to the Colorado Air Quality 
Control Commission (AQCC). Documentation provided by Coors, and 
included in CACI's hearing statement, indicated that costs to retrofit 
the non-complying tanks and process vessels at the Coors Golden, 
Colorado facility to permit submerged or bottom filling would be 
approximately $350,000. The corresponding emission reduction would be 
approximately 5.74 tons per year (TPY) or 31.45 pounds per day.
    On March 16, 1995, the AQCC approved an exemption from Reg. 7's 
submerged/bottom-fill requirements consistent with the APCD's March 1, 
1995, proposal. On April 22, 1996, the Governor submitted this 
exemption to EPA for approval as a SIP revision. The exemption is 
limited to beer production and associated beer container storage and 
transfer operations involving VOCs with a true vapor pressure of less 
than 1.5 psia.
    The exemption is applicable to the Denver-Boulder metropolitan area 
in that this area has been the only ozone nonattainment area 
(originally classified as transitional under section 185A of the CAA) 
in Colorado. Coors is the only large-scale brewery operation in the 
Denver-Boulder area, although there are several micro-breweries in the 
Denver-Boulder area to which this exemption would apply.
    On October 30, 1997, EPA asked the APCD for additional information 
regarding the amount of emission reductions that would not be realized 
as a result of the exemption. In a letter dated November 24, 1997, from 
Dennis Myers, Unit Leader, Construction Permits, APCD, to Larry 
Svoboda, Air State Support Unit, Air Program, Region VIII, EPA, the 
State provided further emission estimates for Coors and the micro-
breweries in the Denver-Boulder area that this Reg. 7 revision would 
affect. For the State's November 24, 1997, letter, Coors provided 
additional emissions estimates that indicated approximately 12.442 tons 
per year of VOCs would be exempted from control, at Coors' facility, 
under the revision to Reg. 7. The State also included in its letter a 
listing of 44 brewpubs, contract breweries, and micro-breweries located 
in the Denver-Boulder ozone area. Based on a State ``Inter-Office 
Communication'', included with the State's November 24, 1997, letter, 
the State assigned an annual average emission factor of 0.13 tons per 
year of VOCs for craft breweries (which includes micro-breweries, 
brewpubs, and contract breweries). Including the average annual VOC 
emissions from these additional 44 facilities, the Reg. 7 revision 
would exempt approximately 18.16 tons per year, or 99.5 pounds per day 
of VOC emissions (12.44 tons per year from Coors and 5.72 tons per year 
from micro-breweries, brewpubs, and contract breweries).
    This amount of VOC emissions is extremely minimal compared to the 
total inventory of VOC emissions in the Denver-Boulder area. Therefore, 
EPA does not believe the Reg. 7 exemption will interfere with the 
area's ability to attain and maintain the ozone NAAQS.3 In 
conducting its analysis of the proposed exemption, EPA examined the 
State's VOC emission inventory for the Denver-Boulder area for 1993, 
which the State submitted on August 8, 1996 as part of an ozone 
maintenance plan for the Denver-Boulder area. Although the maintenance 
plan was rendered unnecessary by EPA's revocation of the 1-hour ozone 
standard, EPA believes that the 1993 VOC emission inventory contained 
in the maintenance plan is comprehensive and accurate. In the 1993 
inventory, the State estimated that VOC emissions from anthropogenic 
sources for the Denver-Boulder area were approximately 312 tons per 
day. The Reg. 7 exemption that EPA is acting on today would increase 
(or more accurately, would not reduce) VOC emissions in the Denver-
Boulder area by approximately 99.5 pounds per day, which is equivalent 
to 0.05 tons per day. This is only 0.016% of the total 1993 VOC 
inventory of 312 tons per day, an amount which is not anticipated to 
interfere with the area's ability to attain or maintain the 0.08 ppm 8-
hour ozone standard. Accordingly, EPA is approving the submitted Reg. 7 
exemption as a revision to the SIP.
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    \3\ On July 18, 1997, EPA replaced the 0.12 parts per million 
(ppm) 1-hour ozone standard with a 0.08 ppm 8-hour ozone standard 
(62 FR 38856). On June 5, 1998, EPA revoked the 0.12 ppm 1-hour 
standard for the Denver-Boulder area (and other areas around the 
country) and now only the new 8-hour ozone standard applies. As a 
result of the revocation, the Denver-Boulder area currently has no 
designation for ozone. EPA's current thinking is that the Agency 
will designate areas attainment or nonattainment for the new 
standard in the year 2000.
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II. Analysis of the State's Submittal

    Section 110(k) of the CAA sets out provisions governing EPA's 
action on submissions of revisions to a State Implementation Plan. The 
CAA also requires States to observe certain procedural requirements in 
developing SIP revisions for submittal to EPA. Section 110(a)(2) of the 
CAA requires that each SIP revision be adopted after reasonable notice 
and public hearing prior to being submitted by a State to EPA.
    To accomplish the above revisions to Reg. 7, the AQCC held a public 
hearing on March 16, 1995, directly after which the AQCC adopted the 
revision to Reg. 7. This revision became effective on May 30, 1995. The 
Governor submitted this revision to Reg. 7 to EPA by a letter dated 
April 22, 1996. By operation of law under the provisions of section 
110(k)(1)(B) of the CAA, the submittal became complete on October 22, 
1996.

III. Final Action

    EPA is approving the revision to Colorado Regulation No. 7, section 
III, ``General Requirements for Storage and Transfer of Volatile 
Organic Compounds,'' that adds a new paragraph C as adopted by the AQCC 
on March 16, 1995, and submitted to EPA by the Governor on April 22, 
1996.
    EPA is publishing this action without prior proposal because the 
Agency views this as a noncontroversial amendment and anticipates no 
adverse comments. However, in the proposed rules section of this 
Federal Register publication, EPA is publishing a separate document 
that will serve as the proposal to approve the SIP revision should 
adverse comments be filed. This rule will be effective April 12, 1999 
without further notice unless the Agency receives adverse comments by 
March 11, 1999.
    If EPA receives such comments, then EPA will publish a timely 
withdrawal of the direct final rule informing the public that the rule 
will not take effect. All public comments received will then be 
addressed in a subsequent final rule based on the proposed rule. The 
EPA will not institute a second comment period on this rule. Any 
parties interested in commenting on this rule

[[Page 6233]]

should do so at this time. If no such comments are received, the public 
is advised that this rule will be effective on April 12, 1999 and no 
further action will be taken on the proposed rule.

IV. Administrative Requirements

A. Executive Order 12866

    The Office of Management and Budget (OMB) has exempted this 
regulatory action from Executive Order 12866, entitled ``Regulatory 
Planning and Review.''

B. Executive Order 12875: Enhancing the Intergovernmental Partnership

    Under Executive Order 12875, EPA may not issue a regulation that is 
not required by statute and that creates a mandate upon a state, local, 
or tribal government, unless the Federal government provides the funds 
necessary to pay the direct compliance costs incurred by those 
governments, or EPA consults with those governments. If EPA complies by 
consulting, Executive Order 12875 requires EPA to provide to the Office 
of Management and Budget a description of the extent of EPA's prior 
consultation with representatives of affected state, local, and tribal 
governments, the nature of their concerns, copies of any written 
communications from the governments, and a statement supporting the 
need to issue the regulation. In addition, Executive Order 12875 
requires EPA to develop an effective process permitting elected 
officials and other representatives of state, local, and tribal 
governments ``to provide meaningful and timely input in the development 
of regulatory proposals containing significant unfunded mandates.''
    Today's rule does not create a mandate on state, local, or tribal 
governments. The rule does not impose any enforceable duties on state, 
local, or tribal governments. Accordingly, the requirements of section 
1(a) of Executive Order 12875 do not apply to this rule.

C. Executive Order 13045

    Executive Order 13045, Protection of Children from Environmental 
Health Risks and Safety Risks (62 FR 19885, April 23, 1997), applies to 
any rule that: (1) is determined to be ``economically significant'' as 
defined under E.O. 12866, and (2) concerns an environmental health or 
safety risk that EPA has reason to believe may have a disproportionate 
effect on children. If the regulatory action meets both criteria, the 
Agency must evaluate the environmental health and safety effects of the 
planned rule on children, and explain why the planned regulation is 
preferable to other potentially effective and reasonably feasible 
alternatives considered by the Agency.
    This rule is not subject to E.O. 13045 because it does not involve 
decisions intended to mitigate environmental health or safety risks.

D. Executive Order 13084: Consultation and Coordination With Indian 
Tribal Governments

    Under Executive Order 13084, EPA may not issue a regulation that is 
not required by statute, that significantly affects or uniquely affects 
the communities of Indian tribal governments, and that imposes 
substantial direct compliance costs on those communities, unless the 
Federal government provides the funds necessary to pay the direct 
compliance costs incurred by the tribal governments, or EPA consults 
with those governments. If EPA complies by consulting, Executive Order 
12084 requires EPA to provide to the Office of Management and Budget, 
in a separately identified section of the preamble to the rule, a 
description of the extent of EPA's prior consultation with 
representatives of affected tribal governments, a summary of the nature 
of their concerns, and a statement supporting the need to issue the 
regulation. In addition, Executive Order 13084 requires EPA to develop 
an effective process permitting elected officials and other 
representatives of Indian tribal governments ``to provide meaningful 
and timely input in the development of regulatory policies on matters 
that significantly or uniquely affect their communities.''
    Today's rule does not significantly or uniquely affect the 
communities of Indian tribal governments. Accordingly, the requirements 
of section 3(b) of Executive Order 13084 do not apply to this rule.

E. Regulatory Flexibility Act

    The Regulatory Flexibility Act (RFA) generally requires an agency 
to conduct a regulatory flexibility analysis of any rule subject to 
notice and comment rulemaking requirements unless the agency certifies 
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 small governmental 
jurisdictions. This final rule will not have a significant impact on a 
substantial number of small entities because 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 
create any new requirements, I certify that this action will not have a 
significant economic impact on a substantial number of small entities. 
Moreover, due to the nature of the Federal-State relationship under the 
Clean Air Act, 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).

F. 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 
the private sector, of $100 million or more. Under Section 205, EPA 
must select the most cost-effective and least burdensome alternative 
that achieves the objectives of the rule and is consistent with 
statutory requirements. Section 203 requires EPA to establish a plan 
for informing and advising any small governments that may be 
significantly or uniquely impacted by the rule.
    EPA has determined that 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 a 
redesignation to attainment and 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, will result from this action.

G. Submission to Congress and the Comptroller General

    The Congressional Review Act, 5 U.S.C. section 801 et seq., as 
added by the Small Business Regulatory Enforcement Fairness Act of 
1996, generally provides that before a rule may take effect, the agency 
promulgating the rule must submit a rule report, which includes a copy 
of the rule, to each House of Congress and to the Comptroller General 
of the United States. EPA will submit a report containing this rule and 
other required information to the U.S. Senate, the U.S.

[[Page 6234]]

House of Representatives, and the Comptroller General of the United 
States prior to the publication of the rule in the Federal Register. 
This rule is not a ``major rule'' as defined by 5 U.S.C. section 
804(2).

H. Petitions for Judicial Review

    Under section 307(b)(1) of the Clean Air Act, petitions for 
judicial review of this action must be filed in the United States Court 
of Appeals for the appropriate circuit by April 12, 1999. 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).)
    Nothing in this action should be construed as making any 
determination or expressing any position regarding Colorado's audit 
privilege and penalty immunity law, sections 13-25-126.5, 13-90-107, 
and 25-1-114.5, Colorado Revised Statutes, Colorado Senate Bill 94-139, 
effective June 1,1994, or its impact upon any approved provision in the 
SIP, including the revision at issue here. The action taken herein does 
not express or imply any viewpoint on the question or whether there are 
legal deficiencies in this or any other Clean Air Act program resulting 
from the effect of Colorado's audit privilege and immunity law. A state 
audit privilege and immunity law can affect only state enforcement and 
cannot have any impact on federal enforcement authorities. EPA may at 
any time invoke its authority under the Clean Air Act, including, for 
example, sections 113, 167, 205, 211, or 213, to enforce the 
requirements or prohibitions of the state plan, independently of any 
state enforcement effort. In addition, citizen enforcement under 
section 304 of the Clean Air Act is likewise unaffected by a state 
audit privilege or immunity law.

List of Subjects in 40 CFR Part 52

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

    Note: Incorporation by reference of the State Implementation 
Plan for the State of Colorado was approved by the Director of the 
Federal Register on July 1, 1980.

    Dated: December 21, 1998.
William P. Yellowtail,
Regional Administrator, Region VIII.

    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 G--Colorado

    2. Section 52.320 is amended by adding paragraph (c)(83) to read as 
follows:


Sec. 52.320  Identification of plan.

* * * * *
    (c) * * *
    (83) A revision to the Colorado State Implementation Plan was 
submitted by the Governor of the State of Colorado on April 22, 1996. 
The revision consists of an amendment to Colorado Air Quality Control 
Commission Regulation No. 7, ``Regulation To Control Emissions of 
Volatile Organic Compounds,'' to provide an exemption for beer 
production and associated beer container storage and transfer 
operations involving volatile organic compounds under 1.5 psia from 
certain bottom or submerged filling requirements that Regulation No. 7 
otherwise imposes. The revision consists of the addition of paragraph C 
to section III, ``General Requirements for Storage and Transfer of 
Volatile Organic Compounds,'' of Regulation No. 7.
    (i) Incorporation by reference.
    (A) Colorado Air Quality Control Commission Regulation No. 7, 5 CCR 
1001-9, section III, paragraph C, adopted by the Colorado Air Quality 
Control Commission on March 16, 1995, State effective May 30, 1995.
* * * * *
[FR Doc. 99-2981 Filed 2-8-99; 8:45 am]
BILLING CODE 6560-50-P