[Federal Register Volume 66, Number 183 (Thursday, September 20, 2001)]
[Rules and Regulations]
[Pages 48340-48347]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 01-22125]


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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[CA232-0289, FRL-7048-1]


Approval and Promulgation of Ozone Attainment Plan and Finding of 
Failure To Attain; State of California, San Francisco Bay Area

AGENCY: Environmental Protection Agency (EPA).

ACTION: Final rule.

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SUMMARY: EPA is approving in part and disapproving in part the 1999 San 
Francisco Bay Area Ozone Attainment Plan (1999 Plan), submitted by the 
State of California to EPA to attain the 1-hour ozone national ambient 
air quality standard (NAAQS) in the San Francisco Bay Area. 
Specifically, EPA is approving the baseline emissions inventory, the 
Reasonable Further Progress (RFP) demonstration, control measure 
commitments, and contingency measures in the 1999 Plan as meeting the 
requirements of the Clean Air Act (CAA) applicable to the Bay Area 
ozone nonattainment area. EPA is also approving the removal of 
transportation control measures (TCMs) 6, 11, 12, and 16 from the state 
implementation plan (SIP) for ozone purposes.
    We are disapproving the attainment assessment, its associated motor 
vehicle emissions budgets, and the reasonably available control measure 
(RACM) demonstration. The disapproval triggers, on its effective date, 
an 18-month clock for mandatory application of sanctions, a 2-year time 
clock for promulgation of a federal implementation plan (FIP), and a 
transportation conformity freeze.
    EPA is also finding that the San Francisco Bay Area ozone 
nonattainment area did not attain the 1-hour ozone NAAQS by its 
November 15, 2000 attainment deadline. As a consequence, the State is 
required to submit a new plan no later than 12 months after the 
effective date of this rulemaking.

EFFECTIVE DATE: This rule is effective on October 22, 2001.

ADDRESSES: A copy of this final rule and related information are 
available in the air programs section of EPA Region 9's website, http://www.epa.gov/region09/air. The docket for this rulemaking is available 
for inspection during normal business hours at EPA Region 9, Planning 
Office, Air Division, 17th Floor, 75 Hawthorne Street, San Francisco, 
California 94105. A reasonable fee may be charged for copying parts of 
the docket. Please call (415) 744-1249 for assistance.

FOR FURTHER INFORMATION CONTACT: Celia Bloomfield (415) 744-1249, 
Planning Office (AIR-2), Air Division, EPA Region 9, 75 Hawthorne 
Street, San Francisco, CA 94105; [email protected].

SUPPLEMENTARY INFORMATION:

Table of Contents

I. Background
II. EPA's Responses to Comments on the Proposal
III. Final Action
IV. Administrative Requirements

I. Background

    On March 30, 2000, EPA proposed to partially approve and partially 
disapprove the San Francisco Bay Area Ozone Attainment Plan for the 1-
Hour National Ozone Standard, June 1999 (1999 Plan). Specifically, EPA 
proposed to approve the baseline emissions inventory, the Reasonable 
Further Progress (RFP) demonstration, a commitment to reduce volatile 
organic compound (VOC) emissions by 11 tons per day (tpd) by adopting 
and implementing specified control measures, and contingency measures 
in the 1999 Plan as meeting the requirements of the Clean Air Act (CAA) 
applicable to the Bay Area ozone nonattainment area. EPA also proposed 
to approve the removal of transportation control measures (TCMs) 6, 11, 
12, and 16 from the ozone portion of the California state 
implementation plan (SIP). EPA proposed to disapprove the attainment 
assessment, its associated motor vehicle emissions budgets, and the 
reasonably available control measure (RACM) demonstration.
    EPA's March 30, 2000 notice also included a proposed finding that 
the Bay Area failed to attain the 1-hour National Ambient Air Quality 
Standard (NAAQS) for ozone by its November 15, 2000 attainment 
deadline. For details about EPA's evaluation of the 1999 Plan elements 
and proposed failure to attain finding, please see the proposed 
rulemaking at 66 FR 17379, March 30, 2001.
    The 1999 Plan was submitted to EPA on August 13, 1999 as a proposed 
revision to the SIP. The submittal was made by the California Air 
Resources Board (CARB) on behalf of the Bay Area Air Quality Management 
District (BAAQMD), the Metropolitan Transportation Commission (MTC), 
and the Association of Bay Area Governments (ABAG) to comply with EPA's 
July 10, 1998 rulemaking that redesignated the Bay Area from attainment 
to nonattainment (63 FR 37258, July 10, 1998).

II. EPA's Responses to Comments on the Proposal

A. Overview of Comments

    EPA received 15 letters commenting on the March 30, 2001 proposal. 
The commenters represented State and local air quality and 
transportation agencies, the business community, and a number of public 
interest environmental and environmental justice groups. The majority 
of commenters expressed support for the proposed partial disapproval 
and finding of failure to attain. The proposed partial approval was 
viewed favorably as strengthening the SIP, but several commenters 
objected to the proposed approval of specific plan elements as meeting 
the requirements of section 172 of the CAA. A number of commenters also 
urged EPA and the BAAQMD to evaluate and explain why the 1999 Plan 
failed to provide for attainment. Significant comments are addressed 
below; the remaining comments are addressed in the Technical Support 
Document for this rulemaking.

B. Comments on Proposed Disapproval of Attainment Assessment

    Comment: Many commenters asked that EPA provide a detailed analysis 
of all the reasons why the attainment assessment was flawed. Some 
commenters went further and asked EPA to supplement its reasons in the 
final rulemaking for disapproving the attainment assessment. 
Specifically, commenters argued that the attainment assessment was 
flawed (by a magnitude in the range of 25-50 tpd) not only because it 
inaccurately demonstrated attainment, but also because it: (1) Omitted 
available data by excluding 1998 monitoring data; (2) inaccurately 
estimated the impact deregulation has had on power plant emissions; and 
(3) relied on projections of motor vehicle emissions that assume large 
reductions that historically have not been fully realized.
    Response: EPA shares the concerns raised with regard to the 
attainment

[[Page 48341]]

assessment. However, we do not believe that it is necessary or 
productive at this time to determine whether these concerns provide 
independent bases for disapproval since we are already disapproving the 
assessment based on air quality monitoring data. Nevertheless, the 
points raised are good ones, and we will take them into consideration 
as we review future plans and plan revisions.
    Comment: Counsel for the Transportation Solutions Defense and 
Education Fund (TRANSDEF) commented that EPA's regulations specifically 
require use of a photochemical model, and that if the Bay Area need not 
use UAM modeling, the reasons should be fully explained in the Federal 
Register. The commenter asserted that EPA's ``attainment assessment'' 
approach outlined for the 1999 Plan did not accord with 40 CFR part 
51.112 and appendix W. TRANSDEF also claimed that the Bay Area should 
have used EPA's model substitution process pursuant to 40 CFR part 
51.112(a)(2) to authorize the techniques used in the 1999 Plan.
    Response: EPA regulations at 40 CFR part 51, appendix W (6.0 Models 
of Ozone, Carbon Monoxide and Nitrogen Dioxide) do not mandate the use 
of photochemical modeling or the need to undergo a model substitution 
process. Rather, the pertinent language is as follows:

    A control agency with jurisdiction over areas with significant 
ozone problems and which has sufficient resources and data to use a 
photochemical dispersion model is encouraged to do so. However, 
empirical models fill the gap between more sophisticated 
photochemical dispersion models and may be the only applicable 
procedure if the available data bases are insufficient for refined 
modeling.

    The attainment assessment for the Bay Area was based on an isopleth 
diagram generated from photochemical modeling, an approach EPA believes 
is consistent with the above requirement (1999 Plan, Section V, pp. 16-
18).
    Comment: One commenter stated that the Bay Area's continued lack of 
technically competent data and modeling resources mandates that EPA 
promulgate a Federal Implementation Plan (FIP). The commenter supported 
this position with language from Arizona v. Thomas, 829 F.2d 834 (9th 
Cir. 1987): ``Having failed in its obligation to produce or make 
reasonable efforts to produce SIPs which would appear to meet the 
requirements of the Act, Arizona should not be given another 
opportunity to produce more plans.''
    Response: EPA's disapproval of the attainment assessment triggers 
an obligation of EPA to promulgate a FIP not later than two years 
following the disapproval unless EPA approves an attainment 
demonstration for the area in the interim. The State is currently 
working to submit a new attainment demonstration sooner than the one 
year provided by this final action. EPA believes that it is appropriate 
to first allow the State to replace the deficient SIP consistent with 
the work it is now doing.
    The commenter's reliance on Arizona v. Thomas is misplaced. That 
case involved whether EPA appropriately applied a sanctions regulation 
on the State. The sanctions regulation (under the pre-1990 CAA) applied 
to areas that failed to meet the statutory attainment date. However, 
areas with fully approved SIPs were excluded--i.e., not subject to the 
sanction. Because Arizona did not have a fully approved SIP, the court 
rejected Arizona's claim that the sanction should not apply and that 
Arizona should instead be given a chance to develop a new SIP. The 
narrow regulatory interpretation in that case bears no relevance on the 
post-1990 requirements of the CAA.

C. Comment on Proposed Disapproval of Motor Vehicle Emissions Budgets

    Comment: Earthjustice provided additional justification beyond what 
was discussed in EPA's proposal for disapproving the transportation 
conformity budgets. Specifically, Earthjustice commented that the 
budgets were incorrectly calculated (approximately 20 tpd too high for 
VOC) because ``MTC [Metropolitan Transportation Commission] 
accidentally `misbucketed' vehicle miles traveled [VMT] according to 
speed ranges.'' The commenter further suggested that EPA improve its 
oversight role to avoid similar errors in the future.
    Response: EPA agrees that there have, in some cases, been problems 
with allocations of VMT by speed and therefore with emissions 
estimates. This type of mistake could impact budget levels, as they are 
based on motor vehicle emissions projected for the attainment year. 
With respect to this rulemaking, however, EPA is disapproving the 
budgets because they are based on an attainment assessment that was 
deficient. Therefore EPA need not explore a separate basis for 
disapproval. EPA will work with MTC in the future in an attempt to 
avoid any errors in VMT speed allocation and emissions estimates.

D. Comments on Proposed Disapproval of Reasonably Available Control 
Measure Demonstration (RACM)

    Comment: The BAAQMD questioned the existence of a RACM obligation, 
asserting that all RACM are in place and that the District had already 
responded to public comments related to potential control measures for 
the 1999 Plan.
    Response: The federal RACM obligation for ozone nonattainment areas 
is contained in section 172(c)(1) of the Act, which requires ``the 
implementation of all reasonably available control measures as 
expeditiously as practicable.'' The BAAQMD commenter did not deny this 
obligation, but rather asserted that the obligation has already been 
fulfilled. EPA disagrees with this position. EPA guidance, issued 
November 30, 1999 entitled, ``Guidance on the Reasonably Available 
Control Measures (RACM) Requirement and Attainment Demonstration 
Submissions for Ozone Nonattainment Areas,'' provides that ``[i]n order 
for the EPA to determine whether a State has adopted all RACM necessary 
for attainment as expeditiously as practicable, the State will need to 
provide a justification as to why measures within the arena of 
potentially reasonable measures have not been adopted. The 
justification would need to support that a measure was not `reasonably 
available' for that area and could be based on technological or 
economic grounds.'' At a minimum, the justification should address 
``any measure that a commenter indicates during the public comment 
period is reasonably available for a given area * * * .'' (57 FR 13560, 
April 16, 1992).
    The Bay Area's 1999 Plan itself was silent on the RACM requirement. 
While the supporting documentation for the 1999 Plan did include a 
response to many public comments on control measures, not all of the 
suggested control measures were addressed. Moreover, where measures 
were specifically rejected, the justifications provided generally did 
not address the RACM criteria. According to EPA guidance, ``measures 
could be justified as not meeting RACM if a measure (a) is not 
technologically or economically feasible, or (b) does not advance the 
attainment date for the area'' (``Additional Submission on RACM from 
States with Severe 1-hour Ozone Nonattainment Area SIPs,'' EPA, 
December 14, 2000).
    Comment: Several commenters urged EPA and the BAAQMD to thoroughly 
examine all of the control strategies in place in the South Coast air 
district as

[[Page 48342]]

well as those suggested through public comment and at public workshops. 
A number of commenters suggested specific measures that should be 
evaluated as RACM. The San Joaquin Valley Unified Air Pollution Control 
District identified three potential RACM measures for District adoption 
(or amendments to existing BAAQMD rules): SMOG Check II, aqueous 
solvent degreasing, and the permitting and control of smaller engines. 
Sherman Lewis, Chair of the Hayward Area Planning Association, 
identified a range of cash out and transit assistance measures that 
should be considered. Earthjustice suggested a RACM review of all 
BAAQMD and MTC measures that are not currently in the SIP. Another 
commenter urged EPA to clearly state that RACM requires adoption of all 
measures demonstrated in the State to be reasonably available, 
including measures in the Bay Area CAP and BAAQMD Rules 9-10 and 9-11. 
Communities for a Better Environment suggested several refinery 
measures, marine vessel measures, a requirement for diesel engine 
replacement, and others.
    Response: EPA is disapproving the RACM component of the 1999 Plan 
for the reasons noted in the previous response. In order to correct the 
RACM deficiencies, an amended or new plan must consider or evaluate any 
control measures that are suggested by the public during its 
development and adoption as well as measures included in public comment 
on the 1999 Plan and as part of this rulemaking to determine whether or 
not they represent RACM.
    Comment: The majority of commenters emphasized that RACM measures 
should be viewed collectively to determine whether their emissions 
reductions would expedite attainment.
    Response: EPA agrees that RACM measures should be viewed 
collectively to determine whether their emissions reductions would 
expedite attainment. However, EPA has previously concluded that 
``potential measures may be determined not to be RACM if they require 
an intensive and costly effort for numerous small area sources.'' 66 FR 
586, 610; January 3, 2001. This interpretation of RACM ``is based on 
the common sense meaning of the phrase, `reasonably available.' A 
measure that is reasonably available is one that is technologically and 
economically feasible and that can be readily implemented. Ready 
implementation also includes consideration of whether emissions from 
small sources are relatively small and whether the administrative 
burden, to the States and regulated entities, of controlling such 
sources was likely to be considerable. As stated in the General 
Preamble, EPA believes that States can reject potential measures based 
on local conditions including cost (57 FR 13561).'' 66 FR 586, 610; 
January 3, 2001. Also, the development of rules for a large number of 
very different source categories of small sources for which little 
control information may exist will likely take much longer than 
development of rules for source categories for which control 
information exists or that comprise a smaller number of larger sources. 
The longer the rule development time frame, the less likely that the 
emission reductions from the rules would advance the attainment date. 
EPA will analyze future RACM submissions from the Bay Area in light of 
these conclusions.

E. Comments on Proposed Approval of Baseline Emissions Inventory

    Comment: Several commenters questioned the approvability of the 
1995 baseline emissions inventory. Counsel for Our Children's Earth and 
Communities for a Better Environment argued that any approval of the 
emissions inventory without knowledge of why the plan failed is 
arbitrary. Another commenter questioned the inventory's accuracy, 
citing the increase in on-road mobile source emissions when CARB 
updated its mobile source model. Also raised was a concern that the 
inventory was not sufficiently ``current'' to be approvable.
    Response: EPA believes it is not appropriate to assess the adequacy 
of an emissions inventory based on the ultimate success or failure of a 
plan. EPA reviewed the emissions inventory carefully and had a number 
of discussions with Air District and CARB staff about the estimates 
provided for various source categories. As noted in the March 30, 2001 
proposal, the inventory figures were based on actual emissions in 1995. 
EMFAC 2000, CARB's newer mobile source model, was not available at the 
time, and hence could not be used to evaluate the accuracy of the 
inventory.
    EPA believes that the emissions inventory can be approved because 
it is current in the context of the 1999 Plan. The decision to allow a 
1995 baseline inventory was first proposed by EPA in 1997 and 
finalized, after public notice and comment, in 1998. No adverse comment 
was received. The plan was prepared in 1998 and submitted to EPA in 
1999.
    In short, we found nothing in our review to suggest that the 
inventory was inconsistent with EPA inventory guidance, ``Emissions 
Inventory Guidance for Implementation of Ozone and Particulate Matter 
National Ambient Air Quality Standards (NAAQS) and Regional Haze 
Regulations'' (EPA 454/R-99-006, April 1999). Nevertheless, since the 
Bay Area will have to submit a new plan in response to the disapproval 
and finding of failure to attain, there will need to be a new emissions 
inventory to support that plan.
    Comment: Communities for a Better Environment pointed out that 
there are over 1300 Notices of Violation (NOVs) in the Bay Area that 
have not been processed, suggesting that rule effectiveness assumptions 
for various source categories may be overstated. If this is the case, 
emissions levels could likely be higher than the inventory figures.
    Response: EPA does not judge the adequacy of emissions inventories 
on NOV statistics. In many cases, the issuance of a large number of 
NOVs indicates a healthy enforcement program. Moreover, many NOVs are 
written for non emissions-related violations (e.g., recordkeeping) or 
for extremely minor emissions violations; therefore unresolved NOVs are 
not a good gauge for the effectiveness of a rule or regulatory program. 
The BAAQMD's enforcement process is to cite violations on site 
(sometimes multiple NOVs at a site daily). Compliance is demanded 
within fifteen to twenty days or further NOVs are issued until the 
problem is corrected. (BAAQMD Enforcement Division Policies and 
Procedures Manual, Notice of Violation Guidelines, pp. 5-6.) Violations 
are often bunched and then settled as a group for a particular 
facility; hence, it is not uncommon at any moment in time to find many 
seemingly ``unaddressed'' NOVs. Information about specific NOVs and a 
facility's current compliance status is available from the BAAQMD.
    Moreover, one of the concepts behind rule effectiveness is that 
there is not 100% compliance. The estimated noncompliance is factored 
into the inventory.

F. Comments on Proposed Approval of Reasonable Further Progress 
Demonstration

    Comment: Counsel for Our Children's Earth and Communities for a 
Better Environment opined that, unless EPA makes a finding as to why 
the Bay Area failed to attain the ozone standard, it is arbitrary to 
assume that the adopted measures were as effective as promised in the 
SIP. The commenter asserts that continuing exceedances (particularly in 
1998--after three years of plan

[[Page 48343]]

implementation) is evidence that the measures were not as effective as 
promised and that RFP did not occur.
    Response: RFP is defined as ``annual incremental reductions in 
emissions of the relevant air pollutant * * *.'' (CAA section 171(1)). 
For ozone, which is not emitted directly, the reductions must come from 
sources of the ozone precursors, VOC and NOX. While it seems 
to make sense that reductions in VOC and NOX could be 
measured by improvement in ozone levels, that is not necessarily the 
case. For instance, in the Bay Area, ozone levels are not decreasing as 
expected in response to the precursor emissions reductions. ``Proposed 
Final San Francisco Ozone Attainment Plan for the 1-Hour National Ozone 
Standard,'' June 2001, Figure 4. EPA therefore relies on the 
implementation of control measures, which are designed to reduce 
precursor emissions, to determine whether or not progress in reduction 
of emissions is being made. EPA concludes that the adopted measures are 
being implemented and sufficient reductions in emissions have occurred 
to represent reasonable further progress.

G. Comments on Proposed Approval of Control Measures

    Comment: Commenters provided several arguments for finding the 
control strategy inadequate. First, the controls proposed did not 
compensate for the underestimated motor vehicle emissions calculated by 
EMFAC7g. The commenter urged EPA to look more closely at emissions 
reductions relied upon from state measures. In addition, the commenter 
stressed that control strategies should not be limited to emissions 
limitations, but should also include strategies such as closing or 
relocating sources and economic incentive programs. The commenter asked 
EPA to comment negatively on the control strategy in the 1999 Plan and 
to direct that all future measures be more specific and enforceable 
before federal credit is given.
    Response: EPA agrees that the 1999 Plan's overall control strategy 
was inadequate for attainment and, as a result, is disapproving the 
plan. EPA is, however, approving the individual control measures in the 
plan because they strengthen the SIP. In any case, in the next planning 
effort for the Bay Area, the control strategy will have to be 
supplemented with additional measures needed for attainment and that 
are specific enough to be federally enforceable. Any future attainment 
demonstration will have to include sufficient control measures to 
reduce accurately projected motor vehicle emissions, and could include 
innovative control strategies as necessary to demonstrate attainment.

H. Comments on Proposed Approval of Contingency Measures

    Comment: Counsel for Our Children's Earth and Communities for a 
Better Environment suggested that EPA revise its proposed approval of 
the contingency measures to a conditional approval, the condition being 
the requirement for additional contingency measures within one year.
    Response: Contingency measures are intended to provide continued 
progress ``in the year following the year in which the failure has been 
identified'' (57 FR 13511, April 16, 1992). In the Bay Area, the 
contingency measures in the 1999 Plan have already been triggered. 
Under CAA section 179(d), a new plan, including additional contingency 
measures to be triggered in the future, is required to be submitted to 
EPA within one year after the effective date of the final finding of 
failure to attain.
    Comment: Counsel for TRANSDEF asserted that the contingency 
measures failed to meet the criteria and purpose of the Act because 
such measures are intended to be measures above and beyond the ordinary 
control strategies that come into effect automatically in response to a 
missed milestone or a failure to attain.
    Response: EPA has long held that control measures that are in 
excess of those projected as being required for timely attainment may 
be used to satisfy the contingency measure requirements of CAA section 
172(c)(9) because the measures will provide for continued emission 
reduction progress beyond the core control strategy. See, e.g., 58 FR 
52467, 52473 (October 8, 1993).

I. Comments on Environmental Justice

    Comment: Several commenters noted that the public engagement 
process is key to ensuring environmental justice. According to 
TRANSDEF, the environmental justice processes at the Air District and 
MTC are generally inadequate. Earthjustice noted that the time line for 
the upcoming plan revision is being driven by the wish to avert 
conformity consequences and is resulting in a rushed public process 
that compromises procedural environmental justice. Communities for a 
Better Environment commented on the need for a full public process 
(i.e., sufficient public notification and adequate time) so that 
community members can identify and comment on transportation and 
stationary source control measures that should be adopted.
    Response: EPA agrees that an effective public involvement process 
is important and that more public process and community input is 
preferable to less. Moreover, EPA is committed to the principles of 
environmental justice to ensure that all Americans have equal access to 
the decision making process. We believe that the public process for the 
1999 Plan provided everyone the opportunity for meaningful involvement 
and met all legal requirements set out in CAA section 110(a) and 40 CFR 
part 51. Nonetheless, EPA is aware of the public's concerns and is 
continuing to encourage and support additional public involvement 
efforts by the State and local agencies.

J. Comments on Proposed Finding of Failure to Attain

    Comment: Legal counsel for TRANSDEF contends that the Supreme Court 
decision in Whitman v. American Trucking Association, 149 L.Ed.2d 1, 
31-48, 121 S.Ct. 903, dictates that EPA reconsider its position 
regarding the Bay Area's nonattainment designation under the general 
nonattainment provisions of Part D subpart 1 of the Act. This commenter 
asserts that the Bay Area should be designated as subject to the more 
prescriptive requirements of subpart 2 of part D and classified as 
``severe'' to impose additional planning and SIP requirements.
    Two commenters also argued that the Bay Area ought to be classified 
as a severe area due to the number of times it has failed to attain 
since the 1990 CAAA and the date by which it is now expected to attain 
the national ozone standard (i.e., 2006). It was suggested that EPA 
propose a severe classification in a separate rulemaking.
    Response: The issue of whether subpart 1 or subpart 2 applies to 
the Bay Area was decided in the action redesignating the Bay Area from 
attainment to nonattainment for the 1-hour ozone NAAQS (63 FR 37258, 
July 10, 1998). Whitman v. ATA concerned the applicability of subpart 2 
to the implementation of a revised ozone NAAQS, in this case the 8-hour 
standard. There is nothing in the Court's opinion to suggest that 
subpart 2 must apply to a redesignation from attainment to 
nonattainment for the 1-hour ozone NAAQS. Thus, at this time, EPA does 
not intend to reconsider its prior final decision regarding the 
applicable implementation provisions for the Bay Area. However, EPA is 
currently beginning efforts to respond to the Court's remand of the 
implementation issue for the 8-hour standard. If, in developing that 
policy, EPA reaches any conclusions that

[[Page 48344]]

would affect the basis for EPA's final rule determining that the Bay 
Area should implement the 1-hour standard under subpart 1, the Agency 
will reconsider its position with respect to the Bay Area at that time.

K. Comments on Consequences of Partial Disapproval

    Comment: MTC stated that there are minor errors in EPA's discussion 
of the conformity freeze and lapse consequences of a plan disapproval. 
Specifically, in the event of a freeze, MTC asserted that it can still 
adopt its upcoming RTP even though a conformity finding cannot be made. 
In addition, MTC noted that EPA's list of projects that could proceed 
under a lapse was not exhaustive. The list could include: TCMs in 
approved SIPs, non-regionally significant non-federal projects, 
regionally significant non-federal projects that have already been 
approved prior to a lapse, previously conformed projects that have 
received funding commitments, exempt projects, projects under 40 CFR 
93.127, and traffic synchronization projects. MTC also stated that 
regionally significant transit expansion projects such as light rail 
extensions and bus fleet expansions not yet under contract cannot 
proceed under a lapse.
    Response: Although MTC makes some valid points, MTC is not entirely 
correct. In nonattainment and maintenance areas, a metropolitan 
planning organization (MPO) must demonstrate that a transportation plan 
conforms to the SIP before the transportation plan can be approved. 
During a conformity freeze, no new transportation plans can be found to 
conform pursuant to 40 CFR 93.120(a)(2). Please note that a 
transportation plan or transportation improvement program (TIP) 
amendment can be approved during the freeze if it merely adds or 
deletes exempt projects specified in 40 CFR 93.126 and 93.127. Rail and 
bus expansions can proceed if they are implementing TCMs in the SIP or 
if they only involve minor expansions of rail car or bus fleets (40 CFR 
93.126).
    Comment: Counsel for Our Children's Earth and Communities for a 
Better Environment presented an argument that EPA's disapproval should 
trigger a construction ban pursuant to CAA section 173(a)(4). The 
rationale provided was that EPA's disapproval is essentially equivalent 
to a finding that the SIP is not being adequately implemented. 
Alternatively, counsel requested that EPA issue the following two 
orders: (1) An order prohibiting construction or modification of any 
major source, and (2) an order requiring the BAAQMD to promulgate a 
rule that places CAA section 173(a)(4) authority in the Bay Area's 
permitting program.
    Response: The CAA separately identifies a plan disapproval and the 
finding of failure to implement the SIP, and the underlying premise of 
each is different. A plan disapproval simply means that a specific SIP 
submission does not meet the applicable requirements of the CAA. See 
CAA section 110(k)(3). Thus those rules or plans are not incorporated 
into the approved SIP. A finding of failure to implement, however, 
concerns whether a state is implementing the requirements of an 
approved plan. Thus the failure of a state to have approved rules 
meeting all of the Act's requirements (as evidenced by a disapproval) 
is not the equivalent of a failure to implement measures or 
requirements that EPA has approved as meeting the CAA. In this action, 
there is clearly no finding that the State is not implementing 
provisions approved into the SIP, and hence, the restrictions on 
permitting set forth in section 173(a)(4) do not apply. EPA is 
disapproving portions of a plan and thus the consequences of 
disapproval will apply.

L. Comments on Requirement for a New Plan

    Comment: Several commenters expressed concern that EPA seemed to be 
rushing the Bay Area into another planning process and was not 
providing sufficient guidance for the next plan.
    Response: Under CAA section 179(d), the Bay Area has one year from 
the effective date of the finding of failure to attain to submit a new 
attainment plan. The State and local agencies have accelerated their 
plan development process, apparently in order to avoid the consequences 
of a conformity lapse which will take effect January 2002 if the Plan's 
deficiencies are not corrected by that time. EPA is doing its best to 
be responsive to the State's concerns and schedule while at the same 
time providing meaningful input to ensure a viable plan.
    Comment: A number of commenters suggested that EPA should exercise 
its CAA section 179(d)(2) authority to prescribe control measures. 
Specific suggestions include measures that target stationary sources 
located within low income communities of color; public transit 
measures; measures that address issues such as urban sprawl, land use, 
and growth in vehicle miles traveled; and any other measures identified 
through public comment.
    Response: It is difficult for EPA to prescribe specific control 
measures in the Bay Area where both stationary and mobile source 
controls meet, and often exceed, federal requirements and where 
innovative programs and emerging technologies will be needed for future 
emissions reductions. Control measures currently under development in 
the South Coast region (the only ``extreme'' ozone area in the country) 
and at CARB are already being targeted for future Bay Area plans. 
Initiatives to address issues such as urban sprawl and land use are 
appropriately devised at the local and State levels. In light of these 
factors, EPA does not believe it would be reasonable to impose specific 
controls under CAA section 179(d)(2) until it first allows the local 
agencies and CARB to explore appropriate feasible measures for the 
area.
    Comment: Members of the environmental community urged EPA to 
require urban airshed modeling for future plans and plan revisions.
    Response: New urban airshed modeling will not be available until 
the 2003-2004 time frame. Moreover, as noted in section II.B. above, 40 
CFR 51.112 allows the use of lesser models for areas not classified as 
serious and higher.

III. Final Action

    EPA is finalizing the partial approval/partial disapproval of the 
1999 Plan and the finding of failure to attain without any changes from 
the March 30, 2001 proposal.

A. Plan Elements Approved

    EPA is approving the following portions of the 1999 Plan: The 
baseline emissions inventory; the RFP demonstration through 2000; the 
commitment to achieve 11 tons per day of additional VOC reductions from 
implementation of new control measures (see Table 1 below); and 
contingency measures for failure to attain in 2000 (see Table 2 below). 
EPA has determined that these plan elements meet the requirements of 
CAA section 172(c), EPA guidance and EPA's final redesignation 
rulemaking (63 FR 37258, July 10, 1998). EPA is also approving the 
removal of TCMs 6, 11, 12, and 16 (see Table 3 below) from the SIP for 
ozone purposes as EPA has concluded that the removal is consistent with 
sections 110(l) and 193 of the CAA.

[[Page 48345]]



                     Table 1.--New Bay Area Measures
------------------------------------------------------------------------
                                                              Estimated
                                                                 VOC
VOC Measure (BAAQMD Regulation    Adoption   Implementation   Reduction
            Number)                 date          date       (tpd), 1995-
                                                                 2000
------------------------------------------------------------------------
SS-01: Can and Coil Coating (8-    11/19/97   1/1/98, 1/1/          0.35
 11)..........................                        2000
SS-02: Equipment Leaks at            1/7/98         1/7/98          1.20
 Refineries and Chemical
 Plants (8-18)................
SS-03: Pressure Relief Devices  12/17/97, 3/        7/1/98          0.13
 (8-28).......................        18/98
SS-04: Solvent Cleaning (8-16)      9/16/98         9/1/99          2.10
SS-05: Graphic Arts Operations       3/2/99   7/1/99, 1/1/          0.80
 (8-20).......................                        2000
SS-06: Polystyrene                     1999         6/2000          0.26
 Manufacturing (8-52).........
SS-07: Organic Liquid Storage:         1999         6/2000          0.48
 Low Emitting Retrofits for
 Slotted Guide Poles (8-5)....
SS-08: Gasoline Dispensing             1999         6/2000          3.20
 Facilities (8-7).............
SS-09/SS-10: Prohibit Aeration         1999         6/2000          2.68
 of Petroleum Contaminated
 Soil or Industrial Sludge at
 Landfills (8-40).............
MS-01: Electric Golf Carts:            1994         3/2000           0.1
 Require New Golf Cart
 Purchases to be Electric (ARB
 State Rule)..................
------------------------------------------------------------------------


                                     Table 2.--Bay Area Contingency Measures
----------------------------------------------------------------------------------------------------------------
  Adopted Control Measure (BAAQMD       Estimated VOC Reductions (tpd)         Estimated NOX Reductions (tpd)
    Regulation or State/Federal    -----------------------------------------------------------------------------
             Measure)                   2001         2002         2003         2001         2002         2003
----------------------------------------------------------------------------------------------------------------
Gasoline Dispensing Facilities (8-          0.5          0.9          1.1  ...........  ...........  ...........
 7)...............................
Graphic Arts Printing and Coating           0.8          0.7          0.7  ...........  ...........  ...........
 Operations (8-20)................
Aeration of Contaminated Soil and           0.5          1.0          1.5  ...........  ...........  ...........
 Removal of Underground Storage
 Tanks (8-40).....................
On Road motor Vehicles--Light and          14.4         26.8         39.1         16.8         26.4         35.3
 Medium Duty Cars and Trucks (ARB)
On Road Motor Vehicles--Heavy Duty          0.1          0.5          0.7          3.3          5.0          6.7
 Trucks (ARB).....................
Off Road Mobile Sources (ARB).....          0.1          0.1          0.2          3.8          7.8          9.5
Gasoline-Powered Recreational               0.7          1.6          3.6         (.1)         (.1)         (.2)
 Boats--Exhaust Emission Standards
 (EPA)............................
Stationary Internal Combustion      ...........  ...........  ...........          1.0          1.0          0.9
 Engines (9-8)....................
Stationary Gas Turbines (9-9).....  ...........  ...........  ...........          0.9          0.9          0.8
Glass Melting Furnaces (9-12).....  ...........  ...........  ...........          0.2          0.2          0.1
----------------------------------------------------------------------------------------------------------------


                   Table 3.--TCMs Deleted From The SIP
------------------------------------------------------------------------
 
------------------------------------------------------------------------
TCM 6..................................  Construction of Guadalupe light
                                          rail in Santa Clara County and
                                          design work for the North
                                          Concord BART extension and
                                          Warm Springs extension.
TCM 11.................................  Gasoline Conservation Awareness
                                          Program (GasCAP).
TCM 12.................................  Santa Clara Commuter
                                          Transportation Program.
TCM 16.................................  Construction of BART extension
                                          to Colma.
------------------------------------------------------------------------

B. Plan Elements Disapproved

    EPA is disapproving the attainment assessment in the 1999 Plan 
because monitored air quality indicates that the attainment projections 
were not realized; that is, the area failed to attain the ozone NAAQS 
by November 15, 2000 (CAA section 172(c)(1)). This disapproval does not 
include a protective finding for the motor vehicle emissions budget 
because the budget is not consistent with attainment. EPA is also 
disapproving the RACM demonstration as not meeting the requirements of 
CAA section 172(c)(1) for the reasons explained above.

C. Finding of Failure To Attain

    EPA is finding, pursuant to CAA section 179(c), that the Bay Area 
failed to attain the federal 1-hour ozone standard by its November 15, 
2000 attainment deadline.

D. Consequences of Final Action

    The effective date of the final disapproval starts an 18-month 
clock for the imposition of sanctions pursuant to CAA section 179(a) 
and 40 CFR 52.31, and a 2-year clock for EPA to promulgate a FIP under 
CAA section 110(c)(1). The disapproval also activates a conformity 
freeze under 40 CFR 93.120(a)(2). 62 FR 43796, August 15, 1997. The 
sanctions and FIP clocks can be stopped once the State corrects the 
1999 Plan deficiencies and EPA approves the revisions. The freeze will 
be lifted once EPA receives an approvable budget and finds it adequate.
    In response to the finding of failure to attain, the State is 
required to submit a SIP revision for the Bay Area to EPA by September 
20, 2002 (CAA section 179(d)(1)) that meets the requirements of CAA 
sections 110 and 172 and provides for attainment ``as expeditiously as 
practicable'' but no later than September 20, 2006.

IV. Administrative Requirements

A. Executive Order 12866

    Under Executive Order 12866 (58 FR 51735 (October 4, 1993)), EPA is 
required to determine whether regulatory actions are significant and 
therefore should be subject to Office of Management and Budget (OMB) 
review, economic analysis, and the requirements of the Executive Order. 
The Executive Order defines a ``significant regulatory action'' as one 
that is likely to result in a rule that may meet at least one of the 
four criteria identified in section 3(f), including, under paragraph 
(1), that the rule may ``have an annual effect on the economy of $100 
million or more or adversely affect, in a material way, the economy, a 
sector of the economy, productivity,

[[Page 48346]]

competition, jobs, the environment, public health or safety, or state, 
local or tribal governments or communities.''
    The Agency has determined that the determination of nonattainment 
and SIP approval and disapproval would result in none of the effects 
identified in section 3(f) of the Executive Order. The determination of 
nonattainment is a factual finding based upon air quality 
considerations and does not, in and of itself, impose any new 
requirements on any sectors of the economy. SIP approvals under section 
110 and subchapter I, part D of the CAA do not create any new 
requirements but simply act on requirements that the State is already 
imposing. This SIP disapproval will not change existing requirements 
and does not impose any new requirements. Therefore, these actions 
cannot be said to impose a materially adverse impact on state, local, 
or tribal governments or communities.

B. Executive Order 13211

    These actions are not subject to Executive Order 13211, ``Actions 
Concerning Regulations That Significantly Affect Energy Supply, 
Distribution, or Use'' (66 FR 28355 (May 22, 2001)) because they do not 
constitute a significant regulatory action under Executive Order 12866.

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 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. These 
actions are not subject to Executive Order 13045 because they are not 
economically significant regulatory actions as defined by Executive 
Order 12866.

D. Executive Order 13175

    Executive Order 13175, entitled ``Consultation and Coordination 
with Indian Tribal Governments'' (65 FR 67249, November 6, 2000), 
requires EPA to develop an accountable process to ensure ``meaningful 
and timely input by tribal officials in the development of regulatory 
policies that have tribal implications.'' ``Policies that have tribal 
implications'' is defined in the Executive Order to include regulations 
that have ``substantial direct effects on one or more Indian tribes, on 
the relationship between the Federal government and the Indian tribes, 
or on the distribution of power and responsibilities between the 
Federal government and Indian tribes.''
    This final rule does not have tribal implications. It will not have 
substantial direct effects on tribal governments, on the relationship 
between the Federal government and Indian tribes, or on the 
distribution of power and responsibilities between the Federal 
government and Indian tribes, as specified in Executive Order 13175. 
The SIP approval and disapproval do not affect any existing 
requirements or impose any new requirements. The determination of 
nonattainment is a factual determination and does not directly regulate 
any entity.

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.
    SIP approvals under section 110 and subchapter I, part D of the CAA 
do not create any new requirements but simply act on requirements that 
the State is already imposing. The determination of nonattainment is 
only a factual determination, and does not directly regulate any 
entities. See 62 FR 60001, 60007-8, and 60010 (November 6, 1997) for 
additional analysis of the RFA implications of attainment 
determinations.
    EPA's disapproval does not affect any existing requirements 
applicable to small entities. Any pre-existing federal requirements 
remain in place after this disapproval. Federal disapproval of the 
state submittal does not affect state enforceability. Moreover, EPA's 
disapproval of the submittal does not impose any new Federal 
requirements.
    Therefore, pursuant to 5 U.S.C. 605(b), I certify that today's 
final rule does not have a significant impact on a substantial number 
of small entities within the meaning of those terms for RFA purposes.

F. Unfunded Mandates Reform Act

    Under section 202 of the Unfunded Mandates Reform Act of 1995 
(UMRA), 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 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.
    As discussed above, the finding of nonattainment is a factual 
determination based upon air quality considerations and does not, in 
and of itself, impose any new requirements. The SIP approval simply 
acts on pre-existing requirements under State or local law, and imposes 
no new requirements. The SIP disapproval will not change existing 
requirements and imposes no new requirements. Thus, these actions do 
not constitute a Federal mandate, as defined in section 101 of the 
UMRA, because they do not impose an enforceable duty on any entity.

G. Executive Order 13132

    Executive Order 13132, entitled Federalism (64 FR 43255, August 10, 
1999) 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 early in the process of 
developing the proposed regulation.

[[Page 48347]]

    This determination of nonattainment, SIP approval and disapproval 
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 (64 FR 43255, August 
10, 1999), because the actions do not, in and of themselves, impose any 
new requirements on any sectors of the economy, and do not alter the 
relationship or the distribution of power and responsibilities 
established in the CAA. Thus, the requirements of section 6 of the 
Executive Order do not apply to these actions.

H. National Technology Transfer and Advancement Act

    Section 12(d) of the National Technology Transfer and Advancement 
Act of 1995 (NTTAA), Public Law 104-113, section 12(d) (15 U.S.C. 272 
note) directs EPA to use voluntary consensus standards in its 
regulatory activities unless to do so would be inconsistent with 
applicable law or otherwise impractical. Voluntary consensus standards 
are technical standards (e.g., materials specifications, test methods, 
sampling procedures, and business practices) that are developed or 
adopted by voluntary consensus standards bodies. The NTTAA directs EPA 
to provide Congress, through OMB, explanations when the Agency decides 
not to use available and applicable voluntary consensus standards.
    Today's actions do not involve technical standards and do not 
require the public to perform activities conducive to the use of 
voluntary consensus standards.

I. Submission to Congress and 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 United States Senate, the United States 
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).

J. Petitions for Judicial Review

    Under section 307(b)(1) of the CAA, petitions for judicial review 
of this action must be filed in the United States Court of Appeals for 
the appropriate circuit by November 19, 2001. 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 CAA section 307(b)(2).

List of Subjects in 40 CFR Part 52

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

    Dated: August 28, 2001.
Christine Todd Whitman,
Administrator.

    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 F--California

    2. Section 52.220 is amended by adding paragraph (c)(283) to read 
as follows:


Sec. 52.220  Identification of plan.

* * * * *
    (c) * * *
    (283) San Francisco Bay Area Ozone Attainment Plan for the 1-Hour 
National Ozone Standard, June 1999, was submitted on August 13, 1999 by 
the Governor's designee.
    (i) Incorporation by reference.
    (A) Bay Area Air Quality Management District.
    (1) Tables 10 and 12 of the San Francisco Bay Area Ozone Attainment 
Plan for the 1-Hour National Ozone Standard, June 1999, which detail 
the commitment to adopt and implement any combination of new control 
measures to achieve 11 ton per day reduction in VOC emissions by June 
2000.
    (2) Contingency measures, Table 18, ``Post-Attainment Year (2000-
2003) Inventory Reductions Reflected in the SIP''.

    2. Section 52.223 is amended by adding paragraph (e) to read as 
follows:


Sec. 52.223  Approval status.

* * * * *
    (e) The Administrator approves the following portions of the 1999 
Ozone Attainment Plan for the San Francisco Bay Area submitted by the 
California Air Resources Board on August 13, 1999: the 1995 baseline 
emissions inventory, the reasonable further progress demonstration, and 
the deletion of transportation control measures #6 and #16.
    3. Section 52.237 is amended by adding paragraph (a)(6) to read as 
follows:


Sec. 52.237  Part D disapproval.

    (a) * * *
    (6) The attainment assessment, motor vehicle emissions budgets, and 
Reasonably Available Control Measure (RACM) portions of the San 
Francisco Bay Area Ozone Attainment Plan for the 1-Hour National Ozone 
Standard, June 1999.
[FR Doc. 01-22125 Filed 9-19-01; 8:45 am]
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