[Federal Register Volume 66, Number 210 (Tuesday, October 30, 2001)]
[Proposed Rules]
[Pages 54737-54739]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 01-27259]


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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 70

[MI; FRL-7094-6]


Clean Air Act Proposed Full Approval Of Operating Permits 
Program; Michigan

AGENCY: Environmental Protection Agency (EPA).

ACTION: Proposed rule.

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SUMMARY: The EPA proposes to fully approve the Michigan Title V Federal 
Operating Permits Program, submitted by Michigan pursuant to subchapter 
V of the Clean Air Act, which requires states to develop, and to submit 
to EPA for approval, programs for issuing operating permits to all 
major stationary sources and to certain other sources.

DATES: EPA must receive comments on this proposed action on or before 
November 21, 2001.

ADDRESSES: Comments should be addressed to: Robert Miller, Chief, 
Permits and Grants Section, at the address noted below. Copies of the 
state's submittal and other supporting information used in developing 
the proposed approval are available for inspection during normal 
business hours at the following location: EPA Region 5, 77 West Jackson 
Boulevard, AR-18J, Chicago, Illinois 60604. Please contact Beth 
Valenziano at (312) 886-2703 to arrange a time to inspect the 
submittal.

FOR FURTHER INFORMATION CONTACT: Beth Valenziano, AR-18J, 77 West 
Jackson Boulevard, Chicago, Illinois 60604, Telephone Number: (312) 
886-2703, 
e-mail Addresses: [email protected].

SUPPLEMENTARY INFORMATION: This section provides additional information 
by addressing the following questions:

What is being addressed in this document?
What are the program changes that EPA proposes to approve?
What is involved in this proposed action?

What Is Being Addressed in This Document?

    As required under Subchapter V of the Clean Air Act (the Act), EPA 
has promulgated regulations that define the minimum elements of an 
approvable state operating permits program and the corresponding 
standards and procedures by which the EPA will approve, oversee, or 
withdraw approval of the state programs (see 57 FR 32250 (July 21, 
1992)). These regulations are codified at 40 Code of Federal 
Regulations (CFR) part 70. Pursuant to Subchapter V of the Act, 
generally known as Title V, and the implementing regulations, states 
developed, and submitted to EPA, programs for issuing operating permits 
to all major stationary sources and to certain other sources. Where a 
program substantially, but not fully, met the requirements of part 70, 
EPA granted the program interim approval. If EPA has not fully approved 
a state operating permit program by the expiration of its interim 
approval period, EPA must establish and

[[Page 54738]]

implement in that State a Federal program under 40 CFR part 71.
    EPA promulgated final interim approval of the Michigan Title V 
program on January 10, 1997 (62 FR 1387), and the program became 
effective on February 10, 1997. On June 18, 1997 (62 FR 34010), EPA 
granted Michigan source category limited interim approval, approving 
Michigan's 4 year initial permit issuance schedule. Source category 
limited interim approval allows EPA to approve an initial state permit 
issuance schedule up to 2 years past the 3 year phase in period 
required by 40 CFR 70.4(b)(11)(ii).
    Michigan submitted revisions to its Title V program for EPA 
approval on June 1, 2001, and submitted a supplemental package on 
September 20, 2001. The submittals included corrections to the interim 
approval issues identified in the January 10, 1997 interim approval 
action and additional program revisions and updates.

What Are the Program Changes That EPA Proposes To Approve?

A. Title V Interim Approval Corrections

    In the January 10, 1997 action, EPA identified eight interim 
approval issues. The following is a description of the issues and their 
subsequent resolution.
1. Schedule of Compliance
    40 CFR 70.5(c)(8)(iii)(C) requires that a schedule of compliance 
for a source that is not in compliance with all applicable requirements 
at the time of permit issuance ``resemble and be at least as stringent 
as that contained in any judicial consent decree or administrative 
order to which the source is subject.'' Michigan's original rules did 
not include these provisions. MDEQ corrected this deficiency by adding 
the above quoted requirements to the definition of ``schedule of 
compliance'' in Rule (R) 336.1119(a).
2. Stationary Source
    The 40 CFR 70.2 definition of ``major source'' requires a 
stationary source or any group of stationary sources to include all 
pollutant emitting activities located on one or more contiguous or 
adjacent properties (in addition to other requirements). Although 
MDEQ's definition addressed adjacency, it did not include the provision 
addressing contiguousness. MDEQ corrected this deficiency by adding the 
contiguous requirement to the definition of ``stationary source'' in R 
336.1119(q).
3. Solid Waste Incineration Units
    40 CFR 70.3 requires non-major solid waste incineration units 
required to obtain a permit pursuant to section 129(e) of the Act to 
obtain a Title V permit. These units are not eligible for a permit 
deferral under 40 CFR 70.3(b). Michigan's applicability rules did not 
include non-major solid waste incineration units required to obtain 
permit pursuant to section 129(e). MDEQ corrected this deficiency by 
revising the state's Title V applicability rule (336.1211(1)(c)) to 
specifically include all solid waste incineration units required to 
obtain a permit under section 129(e). In addition, MDEQ revised R 
336.1211(2) to specifically require that all emissions be counted in 
determining a stationary source's potential to emit.
4. Major Source Determinations
    R 336.1212(1) allowed emissions from certain insignificant 
activities to be exempted from determining sources' major source 
status. 40 CFR part 70 does not provide for any such exemptions. MDEQ 
corrected this deficiency by revising R 336.1212 to eliminate the 
portions of the rule that created the exemptions from determining major 
source status. In addition, MDEQ revised R 336.1211(2) to specifically 
require that all emissions are counted in determining a stationary 
source's potential to emit.
5. Compliance Certification
    40 CFR 70.5(c)(9)(i), (ii), and (iv) require permit applications to 
include a certification of compliance with all applicable requirements 
and a statement of the methods used for determining compliance. 
Michigan's statutes and rules did not specifically include these 
provisions. MDEQ corrected this deficiency by revising R 336.1210(2) to 
explicitly include the requirements in 40 CFR 70.5(c)(9)(i), (ii), and 
(iv).
6. Penalties and Fines
    Section 324.5534 of Michigan's Natural Resources and Environmental 
Protection Act (NREPA) provided exemptions from penalties or fines for 
violations caused by an act of God, war, strike, riot, catastrophe, or 
other conditions where negligence or willful misconduct was not the 
proximate cause. Title V does not provide for such broad penalty and 
fine exemptions. Michigan corrected this deficiency by repealing 
Section 324.5534 from the state statute.
7. Startup, Shutdown, Malfunction (SSM) Rules
    Michigan's SSM rules [R 336.1913 and R 336.1914) provided an 
affirmative defense that was broader than that provided by 40 CFR 
70.6(g), and that was also inconsistent with Section 110 of the Act, as 
interpreted in EPA's enforcement discretion policy. The state SSM rules 
therefore affected the state's enforcement and compliance assurance 
authorities required by 40 CFR 70.4(b)(3)(i), 70.4(b)(3)(vii), and 
70.11. MDEQ corrected these deficiencies by rescinding R 336.1913 and R 
336.1914.
8. Audit Privilege and Immunity Law
    Michigan's audit privilege and immunity law, part 148 of NREPA, 
impermissibly affected numerous requirements of the state's Title V 
operating permit program, including: assuring compliance 
[70.4(b)(3)(i)]; enforcing permits and the requirement to obtain a 
permit [70.4(b)(3)(vii)]; and the general enforcement authorities 
[70.11(a) and (c)]. The EPA's final interim approval of Michigan's part 
70 operating permit program outlined the changes and demonstrations 
required for full approval. Michigan corrected these deficiencies by 
amending part 148 of NREPA in accordance with EPA's recommendations, 
and by providing state Attorney General interpretations and an 
additional commitment regarding confidentiality agreements.\1\
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    \1\ See the following correspondence for further information: a 
letter dated June 11, 1997 from Frank J. Kelley, Michigan Attorney 
General, to Russell J. Harding, MDEQ, regarding audit law 
interpretations; a memorandum dated June 20, 1997 from A. Michael 
Leffler, Michigan Department of Attorney General, to Russell J. 
Harding regarding audit law interpretations; a letter dated July 1, 
1997 from Russell J. Harding to Steven A. Herman, USEPA, outlining 
agreed upon statutory revisions; a letter dated November 21, 1997 
from Russell J. Harding, MDEQ, to Steven A. Herman, USEPA, 
submitting the revised audit privilege law; a letter dated December 
12, 1997 from Steven A. Herman to Russell J. Harding stating that 
Michigan's title V audit law issues are resolved.
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B. Other Title V Program Revisions

    The MDEQ has made changes to its Title V program in addition to the 
interim approval corrections. The EPA will address the additional 
program revisions in a separate rulemaking action.

What Is Involved in This Proposed Action?

A. Proposed Action

    The EPA proposes full approval of the Michigan operating permits 
program based on the corrective program revisions the state submitted 
on June 1, 2001 and September 20, 2001. This proposed full approval of 
Michigan's corrective operating permit program submittal addresses only 
the requirements of Title V and part 70, and does not apply to any 
other federal program requirements, such as State Implementation Plans 
pursuant to section 110 of the Act. The EPA finds

[[Page 54739]]

that Michigan has satisfactorily addressed the program deficiencies 
identified in EPA's January 10, 1997 interim approval rulemaking.

B. Citizen Comment Letters on Michigan Title V Program

    On May 22, 2000, EPA promulgated a rulemaking that extended the 
interim approval period of 86 operating permits programs until December 
1, 2001 (65 FR 32035). The Sierra Club and the New York Public Interest 
Research Group challenged this action. In settling the litigation, EPA 
agreed to publish a notice in the Federal Register, so that the public 
would have the opportunity to identify and bring to EPA's attention 
alleged programmatic and/or implementation deficiencies in Title V 
programs. In turn, EPA would respond to the public's allegations within 
specified time periods, if the comments were made within 90 days of 
publication of the Federal Register document.
    The EPA received two timely comment letters pertaining to the 
Michigan Title V program. The EPA takes no action on those comments in 
today's action. As stated in the Federal Register document published on 
December 11, 2000 (65 FR 77376), EPA will respond by December 1, 2001 
to timely public comments on programs that have obtained interim 
approval; and EPA will respond by April 1, 2002 to timely comments on 
fully approved programs. The EPA will publish a notice of deficiency 
(NOD) if the Agency determines that a deficiency exists, or will notify 
the commenter in writing to explain the reasons for not making a 
finding of deficiency. An NOD will not necessarily be limited to 
deficiencies identified by citizens and may include any deficiencies 
that we have identified through our program oversight.

Administrative Requirements

    Under Executive Order 12866, ``Regulatory Planning and Review'' (58 
FR 51735, October 4, 1993), this proposed action is not a ``significant 
regulatory action'' and therefore is not subject to review by the 
Office of Management and Budget. Under the Regulatory Flexibility Act 
(5 U.S.C. 601 et seq.) the Administrator certifies that this proposed 
rule will not have a significant economic impact on a substantial 
number of small entities, because it merely approves State law as 
meeting Federal requirements and imposes no additional requirements 
beyond those imposed by State law. This rule does not contain any 
unfunded mandates and does not significantly or uniquely affect small 
governments, as described in the Unfunded Mandates Reform Act of 1995 
(Public Law 104-4), because it proposes to approve pre-existing 
requirements under state law and does not impose any additional 
enforceable duties beyond that required by state law. This rule also 
does not have tribal implications because it will not have a 
substantial direct effect on one or more Indian tribes, 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 by Executive Order 13175, 
``Consultation and Coordination with Indian Tribal Governments'' (65 FR 
67249, November 9, 2000). This rule also does not have federalism 
implications, because it 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, 
``Federalism'' (64 FR 43255, August 10, 1999). The rule merely proposes 
to approve existing requirements under state law, and does not alter 
the relationship or the distribution of power and responsibilities 
between the State and the Federal Government established in the Act. 
This proposed rule also is not subject to Executive Order 13045, 
``Protection of Children from Environmental Health Risks and Safety 
Risks'' (62 FR 19885, April 23, 1997) or Executive Order 13211, 
``Actions Concerning Regulations That Significantly Affect Energy 
Supply, Distribution, or Use'' (66 FR 28355 (May 22, 2001), because it 
is not a significantly regulatory action under Executive Order 12866. 
This action will not impose any collection of information subject to 
the provisions of the Paperwork Reduction Act, 44 U.S.C. 3501 et seq., 
other than those previously approved and assigned OMB control number 
2060-0243. For additional information concerning these requirements, 
see 40 CFR part 70. An agency may not conduct or sponsor, and a person 
is not required to respond to, a collection of information unless it 
displays a currently valid OMB control number.
    Section 12(d) of the National Technology Transfer and Advancement 
Act of 1995 (NTTA), 15 U.S.C. 272 note, requires federal agencies to 
use technical standards that are developed or adopted by voluntary 
consensus to carry out policy objectives, so long as such standards are 
not inconsistent with applicable law or otherwise impracticable. In 
reviewing state operating permit programs pursuant to Title V of the 
Act, EPA's role is to approve state choices, provided that they meet 
the criteria of the Act. Absent a prior existing requirement for the 
state to use voluntary consensus standards, EPA has no authority to 
disapprove an operating permit program submission for failure to such 
standards, and it would thus be inconsistent with applicable law for 
EPA to use voluntary consensus standards in place of an operating 
permit program submission that otherwise satisfies the provisions of 
the Act. Therefore, the requirements of section 12(d) of the NTTA do 
not apply.
    As required by section 3 of Executive Order 12988 (61 FR 4729, 
February 7, 1996), in issuing this proposed rule, EPA has taken the 
necessary steps to eliminate drafting errors and ambiguity, minimize 
potential litigation, and provide a clear legal standard for affected 
conduct. EPA has complied with Executive Order 12630 (53 FR 8859, March 
15, 1988) by examining the takings implications of the rule in 
accordance with the ``Attorney General's Supplemental Guidelines for 
the Evaluation of Risk and Avoidance of Unanticipated Takings'' issued 
under the executive order, and has determined that the rule's 
requirements do not constitute a taking.

List of Subjects in 40 CFR Part 70

    Environmental protection, Administrative practice and procedure, 
Air pollution control, Intergovernmental relations, Operating permits, 
Reporting and recordkeeping requirements.

    Authority: 42 U.S.C. 7401-7671q.

    Dated: October 19, 2001.
David A. Ullrich,
Acting Regional Administrator.
[FR Doc. 01-27259 Filed 10-29-01; 8:45 am]
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