[Federal Register Volume 65, Number 248 (Tuesday, December 26, 2000)]
[Rules and Regulations]
[Pages 81366-81369]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-32842]


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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 51

[FRL-6922-5]


Final Rule Making Findings of Failure to Submit Required State 
Implementation Plans for the NOX SIP Call

AGENCY: Environmental Protection Agency (EPA).

ACTION: Final rule.

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SUMMARY: The EPA is taking final action making findings, under the 
Clean Air Act (CAA), that Virginia, West Virginia, Alabama, Kentucky, 
North Carolina, South Carolina, Tennessee, Illinois, Indiana, Michigan, 
Ohio, and the District of Columbia failed to make complete State 
implementation plan (SIP) submittals required under the CAA. Under the 
CAA and EPA's nitrogen oxides (NOX) SIP call regulations, 
these States were required to submit SIP measures providing for 
reductions in the emissions of NOX, an ozone precursor. The 
EPA is continuing to work with these States to assist them in adopting 
State plans that meet the requirements of the NOX SIP Call 
and is hopeful that States will submit fully approvable plans. The EPA 
is taking this step today to continue the progress being made towards 
reducing NOX emissions in the eastern portion of the country 
because of the significant public health benefits of those reductions. 
This action triggers the 18-month time clock for mandatory application 
of sanctions in these States under the CAA. This action also triggers 
the requirement that EPA promulgate a Federal implementation plan (FIP) 
within 2 years of making the finding.

EFFECTIVE DATE: January 25, 2001.

ADDRESSES: A docket containing information relating to this rulemaking 
(Docket No. A-98-12) is available for public inspection at the Air and 
Radiation Docket and Information Center (6102), U.S. Environmental 
Protection Agency, 401 M Street, SW, room M-1500, Washington, DC 20460, 
telephone (202) 260-7548, between 8:00 a.m. and 5:30 p.m., Monday 
through Friday, excluding legal holidays. A

[[Page 81367]]

reasonable fee may be charged for copying.

FOR FURTHER INFORMATION CONTACT: General questions concerning this 
notice should be addressed to Jan King, Office of Air Quality Planning 
and Standards, Air Quality Strategies and Standards Division, MD-15, 
Research Triangle Park, NC 27711; telephone (919) 541-5665. Legal 
questions should be addressed to Howard J. Hoffman, Office of General 
Counsel, 1200 Pennsylvania Avenue, NW, MC-2344A, Washington, DC 20460, 
telephone (202) 564-5582.

SUPPLEMENTARY INFORMATION: You can find a copy of today's action at 
http://www.epa.gov/ttn/rto.
    The contents of this preamble are listed in the following outline:

I. Background

II. What Action is EPA Taking Today?

III. Administrative Requirements

A. Notice and Comment Under the Administrative Procedure Act (APA)
B. Executive Order 12866 (Regulatory Planning and Review)
C. Regulatory Flexibility Act (RFA)
D. Unfunded Mandates Reform Act of 1995 (UMRA)
E. Submission to Congress and the General Accounting Office
F. Paperwork Reduction Act
G. Judicial Review

I. Background

    For almost 30 years, Congress has focused major efforts on curbing 
ground-level (tropospheric) ozone. In 1990, Congress amended the CAA to 
better address, among other things, continued nonattainment of the 1-
hour ozone National Ambient Air Quality Standards (NAAQS) and transport 
of air pollutants across State boundaries.
    The 1990 Amendments reflect general awareness by Congress that 
ozone is a regional, as well as local problem. Ozone and 
NOX, one of its precursors, may be transported long 
distances across State lines to combine with ozone and precursors 
downwind, thereby worsening the ozone problems downwind. This transport 
phenomenon is a major reason for the persistence of the ozone problem, 
notwithstanding the imposition of numerous emission controls, both 
Federal and State, across the country.
    Section 110(a)(2)(D) of the CAA is one of the most important tools 
for addressing the problem of transport. This section states that 
States must adopt SIPs that contain provisions prohibiting sources 
within the State from contributing significantly to nonattainment 
problems in, or interfering with maintenance by, downwind States. 
Section 110(k)(5) of the CAA authorizes EPA to find that a SIP is 
substantially inadequate to meet any CAA requirement. It further 
authorizes EPA to require a State with an inadequate SIP to submit, 
within a specified period, a SIP revision to correct the inadequacy.
    By notice dated October 27, 1998, EPA issued its final rule under 
sections 110(a)(2)(D) and 110(k)(5) NOX SIP call rules 
finding that emissions of NOX from 22 States and the 
District of Columbia significantly contribute to downwind areas' 
nonattainment of the 1-hour ozone NAAQS (63 FR 57356). In the 
NOX SIP call rule, as modified by the March 2, 2000 
technical amendment (65 FR 11222), EPA also established emissions 
budgets for NOX that each of the identified States must meet 
through enforceable SIP measures. The SIP call rule addressed both the 
1-hour ozone NAAQS in existence since 1979 and a revised 8-hour NAAQS 
EPA promulgated in 1997. Various industries and States challenged the 
final NOX SIP call rule by filing petitions for review in 
the U.S. Court of Appeals for the District of Columbia (D.C. Circuit). 
\1\
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    \1\ In a separate legal challenge to EPA's revised NAAQS for 
ozone and particulate matter, the D.C. Circuit remanded the 8-hour 
ozone NAAQS. American Trucking Associations, Inc. v. EPA, 175 F.3d 
1027 on rehearing 195 F.3d 4 (D.C. Cir. 1999). The Supreme Court is 
considering this case. Because EPA believes we should not continue 
implementation efforts under section 110 due to the uncertainty 
created by the DC Circuit's decision, and the continued litigation, 
EPA indefinitely stayed the NOX SIP call as it applies 
for the purposes of the 8-hour NAAQS (65 FR 56245, September 18, 
2000), including the SIP submission obligation. Therefore, EPA is 
making no findings with respect to the 8-hour basis for the 
NOX SIP call.
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    The September 24, 1998 NOX SIP called required States to 
submit SIP revisions by September 30, 1999. State Petitioners 
challenging the NOX SIP call filed a motion requesting the 
Court to stay the submission schedule until April 27, 2000. In 
response, in May 1999, the DC Circuit issued a stay of the SIP 
submission deadline pending further order of the Court. Michigan versus 
EPA, No. 98-1497 (D.C. Cir., May 25, 1999) (order granting stay in 
part).
    In a separate legal challenge to EPA's revised NAAQS for ozone, the 
D.C. Circuit remanded the 8-hour ozone NAAQS. American Trucking 
Associations, Inc. v. EPA, 175 F.3d 1027 upon rehearing 195 F.3d 4 
(D.C. Cir. 1999). The Supreme Court is considering this case. Prior to 
presenting argument in the SIP call case, EPA informed the court that 
it would stay the 8-hour basis of the SIP call and requested that the 
court stay its consideration of the 8-hour basis of the SIP call due to 
the uncertainties created by the litigation. The EPA indefinitely 
stayed the NOX SIP call as it applies for the purposes of 
the 8-hour NAAQS (65 FR 56245, September 18, 2000).
    On March 3, 2000, the court of appeals issued an opinion, largely 
upholding the 1-hour basis for the NOX SIP call. However, 
the court vacated and remanded the rule as it applied to three States--
Wisconsin, Georgia and Missouri--on the basis that the record for the 
1-hour standard did not support EPA's determinations with respect to 
these three States. The court also remanded, but did not vacate, two 
other minor issues--the definition of an electric generating unit, as 
applied to cogeneration units, and the control level assumed for 
internal combustion engines.
    On April 11, 2000, in light of the court's favorable decision, EPA 
filed a motion with the court to lift the stay of the SIP submission 
date. The EPA requested that the court lift the stay as of April 27, 
2000. The EPA recognized, however, that at the time the stay was 
issued, States had approximately 4 months (128 days) remaining to 
submit SIPs. Therefore, EPA's motion to lift the stay indicated that 
EPA would allow States until September 1, 2000 to submit SIPs 
addressing the SIP call.\2\ On June 22, 2000, the Court granted EPA's 
request in part. The Court ordered that EPA allow the States 128 days 
from the June 22, 2000 date of the order to submit their SIPs.\3\ 
Therefore, SIPs were due October 30, 2000.\4\ Because the court vacated 
the rule as to Wisconsin, Georgia, and Missouri, these States were not 
required to submit SIPs by that date.
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    \2\ In the April 11 letters to the States, EPA recognized that 
Wisconsin, Georgia and Missouri were not required to submit SIPs 
because the court vacated (and remanded to EPA for further 
consideration) the NOX SIP call rule as it applied to 
those States. Recognizing that the court remanded (but did not 
vacate) as to two limited issues, EPA also provided that the States 
that remained subject to the SIP call could choose to submit SIPs 
addressing only the portion of the NOX budgets that were 
not affected by the courts remand of two issues: the definition of 
an electric generating unit and the level of control for internal 
combustion engines.
    \3\ The EPA determined that SIPs were due on October 30, 2000, 
which is the first business day following the expiration of the 128-
day period.
    \4\ The EPA's stay of the 8-hour basis stayed all aspects of the 
rule for purposes of the 8-hour standard, including their obligation 
to submit a SIP. Thus, the findings EPA is making are not for 
purposes of the 8-hour basis of the SIP call.
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II. What Action is EPA Taking Today?

    Today, EPA is making findings of failure to officially submit 
complete submissions to their SIPs, including adopted rules, in 
response to the SIP call. The States that are receiving these

[[Page 81368]]

findings are Virginia, West Virginia, Alabama, Kentucky, North 
Carolina, South Carolina, Tennessee, Illinois, Indiana, Michigan, Ohio, 
and the District of Columbia. The EPA intends to continue working with 
these States so that they can submit approvable adopted rules as soon 
as possible. EPA is issuing findings today to help ensure continued 
progress in reducing NOX emissions in the eastern portion of 
the country.
    These findings start an 18-month sanctions clock; if the State 
fails to make the required submittal which EPA determines is complete 
within that period, the emissions offset sanction will apply in 
accordance with 40 CFR 51.121(n) and 52.31. The offset sanction 
requires new or modified sources subject to a CAA section 173 new 
source review program for ozone to obtain reductions in existing 
emissions in a 2:1 ratio to offset their new emissions.\5\ If 6 months 
after the sanction is imposed, the State still has not made a complete 
submittal that EPA has determined is complete, limitations on the 
approval of Federal highway funds will apply in accordance with 
51.212(a) and 52.31. Conversely, the 18-month clock, or additional 6-
month clock, stops and the sanctions will not take effect (or will be 
lifted) when EPA finds that the State has made a complete SIP submittal 
under the SIP call.
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    \5\ In general, the areas subject to a section 173 new source 
review program are those areas with areas designated nonattainment 
for the 1-hour ozone standard. However, all areas in the Northeast 
Ozone Transport Region, regardless of designation, are subject to 
this requirement.
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    In addition, CAA section 110(c) provides that EPA can promulgate a 
FIP immediately after making the findings, as late as 2 years after 
making the findings, or any time in between. Public health in downwind 
States depends on reductions being made upwind, and it is important 
that sources in States that have met their obligations under the 
NOX SIP call are not at a competitive disadvantage to 
sources in other States subject to the NOX SIP call. The EPA 
will take these needs into consideration as it reviews taking any 
action regarding FIPs.
    Our goal is to have approvable SIPs that meet the requirements of 
the NOX SIP call. We remain ready to work with the States to 
develop fully approvable SIPs, which would eliminate the need for EPA 
to promulgate a FIP or replace any FIP that EPA adopts. The process of 
developing the SIP call rulemaking offered opportunities for 
collaboration, and such opportunities remain as the States continue to 
develop their SIPs.
    Recently, EPA sent letters to the Governors of the affected States 
describing the status of the States' effort and these findings in more 
detail. These letters are included in the docket to this rulemaking.

III. Administrative Requirements

A. Notice and Comment Under the Administrative Procedure Act

    This notice is final agency action but is not subject to notice-
and-comment requirements of the Administrative Procedures Act (APA), 5 
U.S.C. 553(b). The EPA invokes, consistent with past practice (for 
example, 61 FR 36294), the good cause exception pursuant to the APA, 5 
U.S.C. 553(b)(3)(B). The EPA believes that because of the limited time 
provided to make findings of failure to submit and findings of 
incompleteness regarding SIP submissions or elements of SIP submission 
requirements, Congress did not intend such findings to be subject to 
notice-and-comment rulemaking. Notice and comment are unnecessary 
because no significant EPA judgment is involved in making a 
nonsubstantive finding of failure to submit SIPs or elements of SIP 
submissions required by the CAA. Furthermore, providing notice and 
comment would be impracticable because of the limited time provided 
under the statute for making such determinations. Finally, notice and 
comment would be contrary to the public interest because it would 
divert agency resources from the critical substantive review of 
complete SIPs. See 58 FR 51270, 51272, n.17 (October 1, 1993); 59 FR 
39832, 39853 (August 4, 1994).

B. Executive Order 12866 (Regulatory Planning and Review)

    This action is exempt from OBM review under Executive Order 12866.

C. Regulatory Flexibility Act

    Under the Regulatory Flexibility Act (RFA), 5 U.S.C. et seq., EPA 
must prepare a regulatory flexibility analysis assessing the impact on 
small entities of any rule subject to the notice-and-comment rulemaking 
requirements. Because this action is exempt from such requirements, as 
described under (A) above, it is not subject to the RFA.

D. Unfunded Mandates Reform Act of 1995

    Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), Public 
Law 104-4, establishes requirements for Federal agencies to assess the 
effects of their regulatory actions on State, local, and tribal 
governments and the private sector. Under section 202 of the UMRA, EPA 
generally must prepare a written statement, including a cost-benefit 
analysis, for proposed and final rules with ``Federal mandates'' that 
may result in expenditures to State, local, and tribal governments, in 
the aggregate, or to the private sector, of $100 million or more in any 
1 year. Before promulgating an EPA rule for which a written statement 
is needed, section 205 of the UMRA generally requires EPA to identify 
and consider a reasonable number of regulatory alternatives and adopt 
the least costly, most cost-effective or least burdensome alternative 
that achieves the objectives of the rule.
    Before EPA establishes any regulatory requirements that may 
significantly or uniquely affect small governments, including tribal 
governments, it must have developed under section 203 of the UMRA a 
small government agency plan. The plan must provide for notifying 
potentially affected small governments, enabling officials of affected 
small governments to have meaningful and timely input in the 
development of EPA regulatory proposals with significant Federal 
intergovernmental mandates, and informing, educating, and advising 
small governments on compliance with the regulatory requirements.
    Today's rule contains no Federal mandates (under the regulatory 
provisions of title II of the UMRA) for State, local, or tribal 
governments or the private sector. The various CAA provisions discussed 
in this notice require the States to submit SIPs. This notice merely 
provides a finding that the States have not met those requirements. 
This notice does not, by itself, require any particular action by any 
State, local, or tribal government, or by the private sector.
    For the same reasons, EPA has determined that this rule contains no 
regulatory requirements that might significantly or uniquely affect 
small governments.

E. Submission to Congress and the General Accounting Office

    Under section 801(a)(1)(A) of the APA, as amended by the Small 
Business Regulatory Enforcement Fairness Act of 1996 (SBREFA), EPA 
submitted, by the effective date of this rule, 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. This rule is not a ``major rule'' as defined by APA 
804(2), as amended.
    The EPA is issuing this action as a rulemaking. There is a question 
as to whether this action is a rule of ``particular applicability'' 
under

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Sec. 804(3)(A) of the APA as amended by SBREFA, and thus exempt from 
the congressional submission requirements, because this rule applies 
only to named States. In this case, EPA has decided to err on the side 
of submitting this rule to Congress, but will continue to consider this 
issue of the scope of the exemption for rules of ``particular 
applicability.''

F. Paperwork Reduction Act

    This rule does not contain any information collection requirements 
which require OMB approval under the Paperwork Reduction Act (44 U.S.C. 
3501 et seq.).

G. Judicial Review

    Under CAA section 307(b)(1), a petition to review today's action 
may be filed in the Court of Appeals for the District of Columbia 
within 60 days of December 26, 2000.

    Dated: December 19, 2000.
Robert Perciasepe,
Assistant Administrator, Office of Air and Radiation.
[FR Doc. 00-32842 Filed 12-22-00; 8:45 am]
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