[Federal Register Volume 65, Number 172 (Tuesday, September 5, 2000)]
[Rules and Regulations]
[Pages 53599-53602]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-22525]


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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[Region II Docket No. NJ36-2-213, FRL-6860-1]


Approval and Promulgation of Implementation Plans; New Jersey; 
Nitrogen Oxides Budget and Allowance Trading Program

AGENCY: Environmental Protection Agency.

ACTION: Final rule.

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SUMMARY: The Environmental Protection Agency (EPA) is announcing 
approval of New Jersey's State Implementation Plan (SIP) revision for 
ozone. This SIP revision relates to New Jersey's portion of the Ozone 
Transport Commission's September 27, 1994 Memorandum of Understanding, 
which includes a regional nitrogen oxides budget and allowance 
(NOX Budget) trading program that will significantly reduce 
NOX emissions generated within the Ozone Transport Region, 
which includes the State of New Jersey. EPA is approving New Jersey's 
regulations, which implement Phase II and Phase III of the 
NOX Budget Trading Program, since they reduce NOX 
emissions and help achieve the national ambient air quality standard 
for ozone.

DATES: This rule is effective on October 5, 2000.

ADDRESSES: Copies of the State submittal and supporting documents are 
available for inspection during normal business hours, at the following 
addresses:

Environmental Protection Agency, Region II Office, Air Programs Branch, 
290 Broadway, 25th Floor, New York, New York 10007-1866.
New Jersey Department of Environmental Protection, Office of Air 
Quality Management, Bureau of Air Quality Planning, 401 East State 
Street, CN418, Trenton, New Jersey 08625.

FOR FURTHER INFORMATION CONTACT: Richard Ruvo, Air Programs Branch, 
Environmental Protection Agency, 290 Broadway, 25th Floor, New York, 
New York 10007-1866, (212) 637-4014.

SUPPLEMENTARY INFORMATION:

Overview

    The EPA is approving the New Jersey Department of Environmental 
Protection's (New Jersey's) Nitrogen Oxides Budget and Allowance 
(NOX Budget) Trading Program for 1999, 2000, 2001, 2002 and 
2003 and thereafter.
    The following table of contents describes the format for this 
SUPPLEMENTARY INFORMATION section:

Overview
EPA's Action
    What Action is EPA Approving?
    Why is EPA Approving this Action?
    When did EPA Propose to Approve New Jersey's Program?
    What did EPA Propose?
    What were the Public's Comments on EPA's Proposal?
    What is the Ozone Transport Commission's Memorandum of 
Understanding?
    Where is Additional Information Available on EPA's Action?
    Conclusion
    Administrative Requirements

EPA's Action

What Action Is EPA Approving?

    The EPA is approving a revision to New Jersey's Ozone State 
Implementation Plan (SIP) which New Jersey submitted on April 26, 1999 
and supplemented on July 31, 2000. This SIP revision relates to New 
Jersey's NOX Budget Trading Program. New Jersey's 
regulations which implement the NOX Budget Trading Program 
are:
     New Subchapter 31, ``NOX Budget Program''
     Guidance for Implementation of Emissions Monitoring 
Requirements for the NOX Budget Program, January 28, 1997
     NOX Budget Program Monitoring Certification and 
Reporting Requirements, July 3, 1997
     Electronic Data Reporting, Acid Rain Program/
NOX Budget Program-Version 2.0, July 3, 1997
     Measurement Protocol for Commercial, Industrial and 
Residential Facilities, April 28, 1993.
    New Jersey also amended Subchapter 3, ``Civil administrative 
penalties for violation of rules adopted pursuant to the Act'' to 
implement the NOX Budget Trading Programs. Subchapter 3 
contains the mechanisms to enforce the NOX Budget Trading 
Program, which are acceptable to EPA. EPA is not incorporating 
Subchapter 3 because EPA can take enforcement actions related to SIP 
penalties under its own corresponding federal regulations.
    EPA will propose action on other components of the July 31, 2000 
SIP revision in a separate future rulemaking.

Why Is EPA Approving This Action?

    EPA is approving this action to:
     Fulfill New Jersey's and EPA's requirements under the 
Clean Air Act (the Act),
     Make New Jersey's NOX Budget Trading Program 
federally-enforceable, and
     Make the significant NOX emission reductions 
available for credit toward the attainment SIP.

[[Page 53600]]

When Did EPA Propose To Approve New Jersey's Program?

    On October 14, 1999, EPA published in the Federal Register (64 FR 
55662) a Proposed Rulemaking conditioning approval of New Jersey's 
regulations as a SIP revision and providing for a 30-day public comment 
period, which ended on November 15, 1999.

What Did EPA Propose?

    In the October 14, 1999 Proposed Rulemaking, EPA proposed to 
condition its approval of New Jersey's NOX Budget Trading 
Program on New Jersey including provisions for defining a violation and 
determining the number of days of a violation should a source not hold 
enough allowances as of the allowance transfer deadline. EPA also 
proposed a full approval of New Jersey's NOX Budget Trading 
Program if New Jersey corrected the deficiency before a final 
rulemaking action, and the correction is consistent with EPA's findings 
as discussed in the Proposed Rulemaking. EPA said it will consider all 
information submitted prior to any final rulemaking action as a 
supplement or amendment to the April 26, 1999 submittal.
    New Jersey proposed provisions on August 2, 1999 and adopted 
provisions in Subchapter 3 on July 31, 2000 which corrected the 
deficiency for defining a violation and determining the number of days 
of a violation. New Jersey submitted the amended provisions to EPA as a 
supplement to the April 26, 1999 SIP submittal on July 31, 2000. The 
amended provisions in Subchapter 3 are consistent with EPA's guidance.

What Were the Public's Comments on EPA's Proposal?

    EPA received no public comments regarding the October 14, 1999 
Proposed Rulemaking.

What Is the Ozone Transport Commission's Memorandum of Understanding?

    The Ozone Transport Commission (OTC) adopted a Memorandum of 
Understanding (MOU) on September 27, 1994, which committed the 
signatory states to the development and proposal of a region-wide 
reduction in NOX emissions, with one phase of reductions by 
1999 and another phase of reductions by 2003. The Act required 
installation of reasonable available control technology (RACT) to 
reduce NOX emissions by May of 1995 (regarded as Phase I). 
The OTC MOU obligated further reductions in NOX emissions by 
1999 (known as Phase II) and by 2003 (known as Phase III).

Where Is Additional Information Available on EPA's Action?

    A detailed discussion of this program is available in the October 
14, 1999 Proposed Rulemaking (64 FR 55662). A Technical Support 
Document, prepared in support of the proposed rulemaking, contains the 
full description of New Jersey's submittal and EPA's evaluation. A copy 
of the Technical Support Document is available upon request from the 
EPA Regional Office listed in the ADDRESSES section.

Conclusion

    EPA is approving New Jersey's program which implements the Ozone 
Transport Commission's September 27, 1994 Memorandum of Understanding 
(Phase II and Phase III). The EPA is approving, as part of the SIP, the 
new regulation Subchapter 31, ``NOX Budget Program,'' 
submitted by New Jersey on April 26, 1999, with supporting 
documentation submitted on July 31, 2000.

Administrative Requirements

Executive Order 12866

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

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 
Executive Order 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 or 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 Executive Order 13045 because it does 
not involve decisions intended to mitigate environmental health or 
safety risks.

Executive Order 13084

    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 
13084 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 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. This action does not involve or impose any requirements 
that affect Indian Tribes. Accordingly, the requirements of section 
3(b) of Executive Order 13084 do not apply to this rule.

Executive Order 13132

    Federalism (64 FR 43255, August 10, 1999) revokes and replaces 
Executive Orders 12612 (Federalism) and 12875 (Enhancing the 
Intergovernmental Partnership). Executive Order 13132 requires EPA to 
develop an accountable process to ensure ``meaningful and timely input 
by state and local officials in the development of regulatory policies 
that have federalism implications.'' ``Policies that have federalism 
implications'' is defined in the Executive Order to include regulations 
that have ``substantial direct effects on the states, on the 
relationship between the national government and the states, or on the 
distribution of power and responsibilities among the various levels of 
government.'' Under Executive Order 13132, EPA may not issue a 
regulation that has federalism implications, that imposes substantial 
direct compliance costs, and that is not required by statute, unless 
the Federal government provides the funds necessary to pay the direct 
compliance costs incurred by state and local governments, or EPA 
consults with state and local officials early in the process of 
developing the proposed regulation. EPA also may not issue a regulation 
that has federalism implications and that preempts state law unless the 
Agency consults with state and local officials

[[Page 53601]]

early in the process of developing the proposed regulation.
    This final rule will not have substantial direct effects on the 
states, on the relationship between the national government and the 
states, or on the distribution of power and responsibilities among the 
various levels of government, as specified in Executive Order 13132, 
because it merely approves a state rule implementing a federal 
standard, and does not alter the relationship or the distribution of 
power and responsibilities established in the Clean Air Act. Thus, the 
requirements of section 6 of the Executive Order do not apply to this 
rule.

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 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).

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 
annual 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 promulgated does not 
include a Federal mandate that may result in estimated annual 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.

Submission to Congress and the Comptroller General

    The Congressional Review Act, 5 U.S.C. 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 the 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. House of 
Representatives, and the Comptroller General of the United States prior 
to publication of the rule in the Federal Register. A major rule cannot 
take effect until 60 days after it is published in the Federal 
Register. This rule is not a ``major rule'' as defined by 5 U.S.C. 
804(2). This rule will be effective October 5, 2000.

National Technology Transfer and Advancement Act

    Section 12 of the National Technology Transfer and Advancement Act 
(NTTAA) of 1995 requires Federal agencies to evaluate existing 
technical standards when developing a new regulation. To comply with 
NTTAA, EPA must consider and use ``voluntary consensus standards'' 
(VCS) if available and applicable when developing programs and policies 
unless doing so would be inconsistent with applicable law or otherwise 
impractical.
    The EPA believes that VCS are inapplicable to this action. Today's 
action does not require the public to perform activities conducive to 
the use of VCS.

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 November 6, 2000. Filing a 
petition for reconsideration by the Administrator of this final rule 
does not affect the finality of this rule for the purposes of judicial 
review nor does it extend the time within which a petition for judicial 
review may be filed, and shall not postpone the effectiveness of such 
rule or action. This action may not be challenged later in proceedings 
to enforce its requirements. (See section 307(b)(2).)

List of Subjects in 40 CFR Part 52

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

    Dated: August 21, 2000.
William J. Muszynski, P.E.,
Deputy Regional Administrator, Region 2.

    Part 52, chapter I, title 40 of the Code of Federal Regulations is 
amended as follows:

PART 52--[AMENDED]

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

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

Subpart FF--New Jersey

    2. Section 52.1570 is amended by adding new paragraph (c)(69) to 
read as follows:


Sec. 52.1570  Identification of plan.

* * * * *
    (c) * * *
    (69) A revision to the State Implementation Plan submitted on April 
26, 1999 and supplemented on July 31, 2000 by the New Jersey Department 
of Environmental Protection that establishes the NOX Budget 
Trading Program.
    (i) Incorporation by reference:
    (A) Title 7, Chapter 27, Subchapter 31, of the New Jersey 
Administrative code entitled ``NOX Budget Program'' adopted 
on June 17, 1998, and effective on July 20, 1998.
    (ii) Additional information.
    (A) Letter from the New Jersey Department of Environmental 
Protection dated April 26, 1999, submitting the NOX Budget 
Trading Program as a revision to the New Jersey State Implementation 
Plan for ozone.
    (B) Letter from the New Jersey Department of Environmental 
Protection dated July 29, 1999, committing to

[[Page 53602]]

correcting the violation definition deficiency within one year of EPA's 
final action.
    (C) Letter from the New Jersey Department of Environmental 
Protection dated July 31, 2000, supplementing the April 26, 1999 SIP 
submittal with the amended violation provisions.
    (D) Guidance for Implementation of Emissions Monitoring 
Requirements for the NOX Budget Program, dated January 28, 
1997.
    (E) NOX Budget Program Monitoring Certification and 
Reporting Requirements, dated July 3, 1997.
    (F) Electronic Data Reporting, Acid Rain/NOX Budget 
Program, dated July 3, 1997.
    (G) Measurement Protocol for Commercial, Industrial and Residential 
Facilities, April 28, 1993.
    3. Section 52.1605 is amended by adding a new entry for Subchapter 
31 under the heading ``Title 7, Chapter 27,'' to the table, in 
numerical order to read as follows:


Sec. 52.1605  EPA--approved New Jersey regulations.

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           State regulation              State effective date      EPA approved date             Comments
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*                  *                  *                  *                  *                  *
                                                        *
Title 7, Chapter 27
 
*                  *                  *                  *                  *                  *
                                                        *
Subchapter 31, ``NOX Budget            July 20, 1998..........  September 5, 2000,       Approval of NOX Budget
 Program.''.                                                     [Insert FR page          Trading Program for
                                                                 citation].               1999, 2000, 2001,
                                                                                          2002, 2003 and
                                                                                          thereafter.
 
*                  *                  *                  *                  *                  *
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[FR Doc. 00-22525 Filed 9-1-00; 8:45 am]
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